Document:

Exhibit 10.2

 

FINAL

 

 

MASTER LEASE

 

 

between

 

 

SPIRIT SPE PORTFOLIO 2006-3, LLC,

 

 

Landlord,

 

 

and

 

 

PAMIDA STORES OPERATING CO., LLC,

 

 

Tenant,

 

 

Dated: 
May 31, 2006

 

 

 

Glossary of Defined Terms

 

	
  Adjustment Date

  	
   

  	
  2

  
	
  Affected Party

  	
   

  	
  60

  
	
  Alteration Cap

  	
   

  	
  18

  
	
  Assigned Lease

  	
   

  	
  20

  
	
  Assignment or Sublease Officer’s Certificate

  	
   

  	
  24

  
	
  Base Rent

  	
   

  	
  2

  
	
  Building

  	
   

  	
  1

  
	
  Buildings

  	
   

  	
  1

  
	
  Capital Improvement

  	
   

  	
  18

  
	
  Casualty Event

  	
   

  	
  26

  
	
  Casualty Withholding Event

  	
   

  	
  28

  
	
  CERCLA

  	
   

  	
  43

  
	
  Claim

  	
   

  	
  43

  
	
  Code

  	
   

  	
  22

  
	
  Commencement Date

  	
   

  	
  1

  
	
  Condemnation

  	
   

  	
  29

  
	
  Condemnation Withholding Event

  	
   

  	
  30

  
	
  Confidential Information

  	
   

  	
  58

  
	
  Confidentiality Agreement

  	
   

  	
  58

  
	
  Costs

  	
   

  	
  7

  
	
  CPI

  	
   

  	
  54

  
	
  CPI Increase

  	
   

  	
  54

  
	
  Cross Default Termination Tests

  	
   

  	
  32

  
	
  Default

  	
   

  	
  31

  
	
  Default Interest

  	
   

  	
  52

  
	
  Disclosure Parties

  	
   

  	
  58

  
	
  EBITDAR

  	
   

  	
  51

  
	
  EBITDAR Event

  	
   

  	
  51

  
	
  EBITDAR Ratio

  	
   

  	
  51

  
	
  EBITDAR Rent

  	
   

  	
  51

  
	
  Effective Date

  	
   

  	
  1

  
	
  Environmental Laws

  	
   

  	
  43

  
	
  Exchange Act

  	
   

  	
  57

  
	
  Expiration Date

  	
   

  	
  1

  
	
  Extension Options

  	
   

  	
  1

  
	
  Extension Period

  	
   

  	
  1

  
	
  Extension Periods

  	
   

  	
  1

  
	
  Fee Properties

  	
   

  	
  1

  
	
  FIFRA

  	
   

  	
  43

  
	
  Flood Insurance Acts

  	
   

  	
  10

  
	
  Flood Insurance Policies

  	
   

  	
  10

  
	
  FMV Base Rent

  	
   

  	
  61

  
	
  FMV Reset

  	
   

  	
  2

  

 

 

	
  Force Majeure

  	
   

  	
  53

  
	
  Ground Landlord

  	
   

  	
  36

  
	
  Ground Lease

  	
   

  	
  36

  
	
  Hazardous Materials

  	
   

  	
  43

  
	
  Holding Audited Reporting Financials

  	
   

  	
  55

  
	
  Holding Reporting Financials

  	
   

  	
  55

  
	
  Holding Unaudited Reporting Financials

  	
   

  	
  55

  
	
  Imposition

  	
   

  	
  4

  
	
  Impositions

  	
   

  	
  4

  
	
  Impositions Reserve

  	
   

  	
  49

  
	
  Indemnified Party

  	
   

  	
  26

  
	
  Insolvency Event

  	
   

  	
  41

  
	
  Installments

  	
   

  	
  4

  
	
  Insurance Deductible Letter of Credit

  	
   

  	
  9

  
	
  Insurance Reserve

  	
   

  	
  49

  
	
  Landlord

  	
   

  	
  1, 52

  
	
  Landlord Indemnified Parties

  	
   

  	
  25

  
	
  Landlord Indemnified Party

  	
   

  	
  25

  
	
  Landlord’s Notice

  	
   

  	
  2

  
	
  Laws

  	
   

  	
  7

  
	
  Lease

  	
   

  	
  1

  
	
  Lease Year

  	
   

  	
  2

  
	
  Leasehold Mortgage

  	
   

  	
  39

  
	
  Leasehold Mortgagee

  	
   

  	
  39

  
	
  Legal Requirements

  	
   

  	
  7

  
	
  Letter of Credit

  	
   

  	
  51

  
	
  Liability Insurance

  	
   

  	
  9

  
	
  Losses

  	
   

  	
  8

  
	
  MAI Appraisers

  	
   

  	
  61

  
	
  Maintenance Expenses

  	
   

  	
  49

  
	
  Maintenance Reserve

  	
   

  	
  49

  
	
  Manage

  	
   

  	
  44

  
	
  Management

  	
   

  	
  44

  
	
  Material Adverse Effect

  	
   

  	
  8

  
	
  Monthly Base Rent

  	
   

  	
  3

  
	
  Mortgage

  	
   

  	
  36

  
	
  Mortgagee

  	
   

  	
  36

  
	
  NDA

  	
   

  	
  21

  
	
  Net Condemnation Proceeds

  	
   

  	
  29

  
	
  Net Insurance Proceeds

  	
   

  	
  27

  
	
  Notice

  	
   

  	
  45

  
	
  OFAC Laws

  	
   

  	
  41

  
	
  Other Lease

  	
   

  	
  32

  
	
  Other Parties

  	
   

  	
  58

  
	
  Pamida

  	
   

  	
  9

  
	
  Parcel

  	
   

  	
  1

  

 

ii

 

	
  Parcels

  	
   

  	
  1

  
	
  Person

  	
   

  	
  41

  
	
  Premises

  	
   

  	
  1

  
	
  Prime

  	
   

  	
  52

  
	
  Property Location

  	
   

  	
  1

  
	
  RCRA

  	
   

  	
  43

  
	
  REA

  	
   

  	
  15

  
	
  REA Change

  	
   

  	
  15

  
	
  REAs

  	
   

  	
  15

  
	
  Release

  	
   

  	
  44

  
	
  Released

  	
   

  	
  44

  
	
  Rent

  	
   

  	
  3

  
	
  Replacement Tenant

  	
   

  	
  33

  
	
  Required Repairs

  	
   

  	
  17

  
	
  Required Repairs Subaccount

  	
   

  	
  17

  
	
  Reserve

  	
   

  	
  49

  
	
  Reserve Event

  	
   

  	
  51

  
	
  Reserve Period

  	
   

  	
  51

  
	
  Reserve Reversal Event

  	
   

  	
  51

  
	
  Reserve Subaccount Account

  	
   

  	
  49

  
	
  Reserve Subaccounts

  	
   

  	
  49

  
	
  Reserves

  	
   

  	
  49

  
	
  Respond

  	
   

  	
  44

  
	
  Response

  	
   

  	
  44

  
	
  Restoration

  	
   

  	
  26

  
	
  Restoration Threshold

  	
   

  	
  27

  
	
  Restore

  	
   

  	
  26

  
	
  S&P

  	
   

  	
  12

  
	
  SEC

  	
   

  	
  55

  
	
  Securities

  	
   

  	
  60

  
	
  Securitization

  	
   

  	
  60

  
	
  ShopKo

  	
   

  	
  9

  
	
  Side-Letter Agreement

  	
   

  	
  53

  
	
  Spirit

  	
   

  	
  55

  
	
  Substitute Property

  	
   

  	
  22

  
	
  Tangible Net Worth

  	
   

  	
  20

  
	
  Tank Insurance

  	
   

  	
  11

  
	
  Tenant

  	
   

  	
  1, 52

  
	
  Tenant Audited Reporting Financials

  	
   

  	
  56

  
	
  Tenant Indemnified Parties

  	
   

  	
  26

  
	
  Tenant Indemnified Party

  	
   

  	
  26

  
	
  Tenant Reporting Financials

  	
   

  	
  56

  
	
  Tenant Unaudited Reporting Financials

  	
   

  	
  56

  
	
  Tenant’s Mortgagee

  	
   

  	
  54

  
	
  Tenant’s Personalty

  	
   

  	
  14

  
	
  Term

  	
   

  	
  1

  

 

iii

 

	
  Terrorism Insurance

  	
   

  	
  11

  
	
  Terrorism Insurance Cap

  	
   

  	
  11

  
	
  Terrorism Insurance Required Amount

  	
   

  	
  11

  
	
  Transaction

  	
   

  	
  22

  
	
  TSCA

  	
   

  	
  43

  
	
  Warranties

  	
   

  	
  17

  

 

iv

 

Table of Contents

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 1. GRANT AND TERM

  	
   

  	
  1

  
	
  1.01

  	
   

  	
  Grant of Lease

  	
   

  	
  1

  
	
  1.02

  	
   

  	
  Term of Lease

  	
   

  	
  1

  
	
  1.03

  	
   

  	
  Extension Options

  	
   

  	
  1

  
	
  1.04

  	
   

  	
  Base Rent Reset

  	
   

  	
  2

  
	
  1.05

  	
   

  	
  Lease Year Defined

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 2. RENT

  	
   

  	
  2

  
	
  2.01

  	
   

  	
  Base Rent

  	
   

  	
  2

  
	
  2.02

  	
   

  	
  Manner of Payment

  	
   

  	
  3

  
	
  2.03

  	
   

  	
  Net Lease

  	
   

  	
  3

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 3. IMPOSITIONS

  	
   

  	
  3

  
	
  3.01

  	
   

  	
  Tenant to Pay Impositions

  	
   

  	
  3

  
	
  3.02

  	
   

  	
  Receipt of Payment

  	
   

  	
  4

  
	
  3.03

  	
   

  	
  Exclusions.

  	
   

  	
  5

  
	
  3.04

  	
   

  	
  Contest

  	
   

  	
  5

  
	
  3.05

  	
   

  	
  Reduction of Assessed Valuation

  	
   

  	
  5

  
	
  3.06

  	
   

  	
  Joinder of Landlord

  	
   

  	
  5

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 4. USE; COMPLIANCE

  	
   

  	
  6

  
	
  4.01

  	
   

  	
  Use

  	
   

  	
  6

  
	
  4.02

  	
   

  	
  Compliance

  	
   

  	
  6

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 5. UTILITIES

  	
   

  	
  8

  
	
  5.01

  	
   

  	
  Payment for Utilities

  	
   

  	
  8

  
	
  5.02

  	
   

  	
  Utilities

  	
   

  	
  8

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 6. INSURANCE

  	
   

  	
  9

  
	
  6.01

  	
   

  	
  Tenant’s Insurance.

  	
   

  	
  9

  
	
  6.02

  	
   

  	
  Blanket Policy

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 7. RETURN OF PREMISES

  	
   

  	
  13

  
	
  7.01

  	
   

  	
  Surrender of Possession

  	
   

  	
  13

  
	
  7.02

  	
   

  	
  Trade Fixtures and Personal Property

  	
   

  	
  14

  
	
  7.03

  	
   

  	
  Survival

  	
   

  	
  14

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 8. HOLDING OVER

  	
   

  	
  14

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9. CONDITION AND CARE OF PREMISES

  	
   

  	
  14

  
	
  9.01

  	
   

  	
  As-Is Condition

  	
   

  	
  14

  
	
  9.02

  	
   

  	
  Tenant’s Obligations

  	
   

  	
  14

  
	
  9.03

  	
   

  	
  Landlord Not Obligated

  	
   

  	
  15

  
	
  9.04

  	
   

  	
  Compliance with REA(s)

  	
   

  	
  15

  
	
  9.05

  	
   

  	
  Required Repairs

  	
   

  	
  17

  
	
  9.06

  	
   

  	
  Warranties

  	
   

  	
  17

  

 

ii

 

	
  ARTICLE 10. RIGHTS RESERVED TO LANDLORD

  	
   

  	
  18

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11. ALTERATIONS

  	
   

  	
  18

  
	
  11.01

  	
   

  	
  Alterations

  	
   

  	
  18

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 12. ASSIGNMENT AND SUBLETTING

  	
   

  	
  19

  
	
  12.01

  	
   

  	
  Assignment

  	
   

  	
  19

  
	
  12.02

  	
   

  	
  Change of Control

  	
   

  	
  20

  
	
  12.03

  	
   

  	
  Subletting and Non-Disturbance

  	
   

  	
  21

  
	
  12.04

  	
   

  	
  Assignment by Landlord

  	
   

  	
  22

  
	
  12.05

  	
   

  	
  Substitution

  	
   

  	
  22

  
	
  12.06

  	
   

  	
  Concessionaires

  	
   

  	
  24

  
	
  12.07

  	
   

  	
  Limits on Assignment, Subletting and Substitution

  	
   

  	
  24

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 13. WAIVER OF CERTAIN CLAIMS; INDEMNITY BY TENANT

  	
   

  	
  25

  
	
  13.01

  	
   

  	
  Waiver of Certain Claims

  	
   

  	
  25

  
	
  13.02

  	
   

  	
  Tenant Responsible for Personal Property

  	
   

  	
  25

  
	
  13.03

  	
   

  	
  Indemnification.

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 14. USE OF CASUALTY INSURANCE PROCEEDS

  	
   

  	
  26

  
	
  14.01

  	
   

  	
  Tenant’s Obligation to Restore

  	
   

  	
  26

  
	
  14.02

  	
   

  	
  No Abatement of Rent

  	
   

  	
  28

  
	
  14.03

  	
   

  	
  Right to Terminate

  	
   

  	
  28

  
	
  14.04

  	
   

  	
  Reduction of Rent

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 15. EMINENT DOMAIN

  	
   

  	
  29

  
	
  15.01

  	
   

  	
  Taking: Lease to Terminate

  	
   

  	
  29

  
	
  15.02

  	
   

  	
  Taking: Lease to Continue

  	
   

  	
  29

  
	
  15.03

  	
   

  	
  No Abatement of Rent

  	
   

  	
  30

  
	
  15.04

  	
   

  	
  Tenant’s Claim for Reimbursement

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 16. DEFAULT

  	
   

  	
  31

  
	
  16.01

  	
   

  	
  Events of Default

  	
   

  	
  31

  
	
  16.02

  	
   

  	
  Rights and Remedies of Landlord

  	
   

  	
  32

  
	
  16.03

  	
   

  	
  Final Damages

  	
   

  	
  34

  
	
  16.04

  	
   

  	
  Removal of Personal Property

  	
   

  	
  35

  
	
  16.05

  	
   

  	
  Landlord’s Default

  	
   

  	
  35

  
	
  16.06

  	
   

  	
  Attorneys’ Fees

  	
   

  	
  35

  
	
  16.07

  	
   

  	
  Tenant Waiver

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 17. SUBORDINATION; LEASEHOLD MORTGAGE

  	
   

  	
  36

  
	
  17.01

  	
   

  	
  Subordination

  	
   

  	
  36

  
	
  17.02

  	
   

  	
  Liability of Mortgagee; Attornment

  	
   

  	
  36

  
	
  17.03

  	
   

  	
  Tenant Leasehold Mortgage.

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 18. MORTGAGEE PROTECTION

  	
   

  	
  40

  
	
   

  	
   

  	
   

  
	
  ARTICLE 19. ESTOPPEL CERTIFICATE

  	
   

  	
  40

  
	
   

  	
   

  	
   

  
	
  ARTICLE 20. REPRESENTATIONS AND WARRANTIES OF TENANT

  	
   

  	
  40

  
	
  20.01

  	
   

  	
  Organization, Authority and Status of Tenant

  	
   

  	
  40

  
	
  20.02

  	
   

  	
  Enforceability

  	
   

  	
  41

  

 

iii

 

	
  20.03

  	
   

  	
  Property Condition

  	
   

  	
  41

  
	
  20.04

  	
   

  	
  Litigation

  	
   

  	
  41

  
	
  20.05

  	
   

  	
  Compliance With OFAC Laws

  	
   

  	
  41

  
	
  20.06

  	
   

  	
  Ownership

  	
   

  	
  41

  
	
  20.07

  	
   

  	
  Absence of Breaches or Defaults

  	
   

  	
  41

  
	
  20.08

  	
   

  	
  Solvency

  	
   

  	
  41

  
	
  20.09

  	
   

  	
  Licenses and Permits

  	
   

  	
  42

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 21. NONWAIVER

  	
   

  	
  42

  
	
   

  	
   

  	
   

  
	
  ARTICLE 22. Intentionally Deleted

  	
   

  	
  42

  
	
   

  	
   

  	
   

  
	
  ARTICLE 23. REAL ESTATE BROKERS

  	
   

  	
  42

  
	
   

  	
   

  	
   

  
	
  ARTICLE 24. NOTICES

  	
   

  	
  42

  
	
   

  	
   

  	
   

  
	
  ARTICLE 25. HAZARDOUS MATERIALS

  	
   

  	
  43

  
	
  25.01

  	
   

  	
  Defined Terms.

  	
   

  	
  43

  
	
  25.02

  	
   

  	
  Tenant’s Obligations with Respect to Environmental Matters

  	
   

  	
  44

  
	
  25.03

  	
   

  	
  Copies of Notices

  	
   

  	
  44

  
	
  25.04

  	
   

  	
  Landlord’s Right to Inspect

  	
   

  	
  45

  
	
  25.05

  	
   

  	
  Tests and Reports

  	
   

  	
  45

  
	
  25.06

  	
   

  	
  Tenant’s Obligation to Respond

  	
   

  	
  45

  
	
  25.07

  	
   

  	
  Landlord’s Right to Act

  	
   

  	
  46

  
	
  25.08

  	
   

  	
  Indemnification

  	
   

  	
  46

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 26. TITLE AND COVENANT AGAINST LIENS

  	
   

  	
  47

  
	
  26.01

  	
   

  	
  Title and Covenant Against Liens

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 27. EXCULPATORY PROVISIONS

  	
   

  	
  48

  
	
   

  	
   

  	
   

  
	
  ARTICLE 28. QUIET USE AND ENJOYMENT

  	
   

  	
  48

  
	
   

  	
   

  	
   

  
	
  ARTICLE 29. CHARACTERIZATION OF LEASE

  	
   

  	
  48

  
	
  29.01

  	
   

  	
  Unseverable Lease

  	
   

  	
  48

  
	
  29.02

  	
   

  	
  Waiver

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 30. RESERVES

  	
   

  	
  49

  
	
  30.01

  	
   

  	
  Reserves

  	
   

  	
  49

  
	
  30.02

  	
   

  	
  Satisfaction of Tenant’s Obligations

  	
   

  	
  49

  
	
  30.03

  	
   

  	
  Reserve Period; Maintenance Expenses

  	
   

  	
  50

  
	
  30.04

  	
   

  	
  Reserve Reversal Event

  	
   

  	
  50

  
	
  30.05

  	
   

  	
  Letter of Credit

  	
   

  	
  50

  
	
  30.06

  	
   

  	
  Defined Terms.

  	
   

  	
  51

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 31. MISCELLANEOUS

  	
   

  	
  52

  
	
  31.01

  	
   

  	
  Successors and Assigns

  	
   

  	
  52

  
	
  31.02

  	
   

  	
  Modifications in Writing

  	
   

  	
  52

  
	
  31.03

  	
   

  	
  Definition of Tenant

  	
   

  	
  52

  
	
  31.04

  	
   

  	
  Definition of Landlord

  	
   

  	
  52

  
	
  31.05

  	
   

  	
  Headings

  	
   

  	
  52

  
	
  31.06

  	
   

  	
  Time of Essence

  	
   

  	
  52

  
	
  31.07

  	
   

  	
  Default Rate of Interest

  	
   

  	
  53

  

 

iv

 

	
  31.08

  	
   

  	
  Severability

  	
   

  	
  53

  
	
  31.09

  	
   

  	
  Entire Agreement

  	
   

  	
  53

  
	
  31.10

  	
   

  	
  Force Majeure

  	
   

  	
  53

  
	
  31.11

  	
   

  	
  Memorandum of Lease

  	
   

  	
  53

  
	
  31.12

  	
   

  	
  No Construction Against Preparer

  	
   

  	
  54

  
	
  31.13

  	
   

  	
  Waiver of Landlord’s Lien

  	
   

  	
  54

  
	
  31.14

  	
   

  	
  Investment Tax Credits

  	
   

  	
  54

  
	
  31.15

  	
   

  	
  Signage

  	
   

  	
  54

  
	
  31.16

  	
   

  	
  Definition of CPI

  	
   

  	
  54

  
	
  31.17

  	
   

  	
  Financial Statements.

  	
   

  	
  55

  
	
  31.18

  	
   

  	
  State-Specific-Provisions

  	
   

  	
  59

  
	
  31.19

  	
   

  	
  Counterparts

  	
   

  	
  59

  
	
  31.20

  	
   

  	
  Mortgagee Consent

  	
   

  	
  59

  
	
  31.21

  	
   

  	
  Waiver of Jury Trial and Certain Damages

  	
   

  	
  59

  
	
  31.22

  	
   

  	
  Securitizations

  	
   

  	
  60

  
	
  31.23

  	
   

  	
  No Merger

  	
   

  	
  60

  
	
  31.24

  	
   

  	
  Fair Market Rent

  	
   

  	
  61

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 32. Intentionally Deleted

  	
   

  	
  62

  

 

v

 

	
  Exhibits:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit A-1

  	
   

  	
  List of Fee Properties

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit A-2

  	
   

  	
  Intentionally Deleted

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit A-3

  	
   

  	
  Legal Description of Each Parcel

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit A-4

  	
   

  	
  Intentionally Deleted

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit B

  	
   

  	
  Limited Rent Determination/Adjustment Formula

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit C

  	
   

  	
  Form of Estoppel Letter

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit D

  	
   

  	
  Form of Sublease Non-Disturbance Agreements

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit E

  	
   

  	
  Form of Mortgagee Non-Disturbance Agreement

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit F

  	
   

  	
  Form of Landlord Agreement

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit G

  	
   

  	
  Form of Memorandum of Lease

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit H

  	
   

  	
  State Specific Provisions

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit I

  	
   

  	
  Required Repairs

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Exhibit J

  	
   

  	
  Form Income and Expense Statement for Individual

  
	
   

  	
   

  	
  Property Location

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedules:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Schedule 6.01

  	
   

  	
  Tenant’s Insurance Coverage Requirements

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Schedule 12.01

  	
   

  	
  Officer’s Certificate (Assignment)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Schedule 12.03

  	
   

  	
  Officer’s Certificate (Subletting)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Schedule 16.01(j)

  	
   

  	
  Other Lease

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Schedule 31.17(g)

  	
   

  	
  Form of Confidentiality Agreement

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Schedule 31.17(h)

  	
   

  	
  Officer’s Certificate (Financial Reports)

  

 

vi

 

MASTER LEASE

 

THIS MASTER LEASE
(hereinafter, this “Lease”) is made and entered into as of the 31st day of May 2006 (the “Effective Date”),
by and between SPIRIT SPE PORTFOLIO 2006-3, LLC, a Delaware limited liability
company (hereinafter, “Landlord”), and PAMIDA STORES OPERATING CO., LLC,
a Delaware limited liability company (hereinafter “Tenant”).

 

ARTICLE 1.

GRANT AND TERM

 

1.01         Grant of Lease. Landlord, for and in
consideration of the rents reserved herein and of the covenants and agreements
contained herein on the part of Tenant to be performed, hereby leases to
Tenant, and Tenant hereby leases from Landlord, those certain parcels of land
owned by Landlord in fee and listed on Exhibit A-1 attached hereto and
made a part hereof (the “Fee Properties”), the Fee Properties are each,
a “Parcel” and collectively, the “Parcels” and legally described
on Exhibit A-3 attached hereto and made a part hereof) and all of
the buildings located on each of the Parcels (each, a “Building” and
collectively the “Buildings”) and with respect to each Parcel, all other
improvements erected or situated on each such Parcel, including, but not
limited to, to the extent they exist, parking areas; access roads; entrances
and driveways; lighting facilities; grass, shrubs, trees and landscaping;
retaining walls; passageways, sidewalks and curbs; culverts; retention basins
and drainage facilities; directional and shopping center pylons or monuments;
sewer and sewage disposal systems; water supply, electric lines; gas lines and
other service and utility lines, pipes and installations of every kind (each
Parcel, together with the Building and the other improvements located thereon,
a “Property Location” and collectively, the “Premises”), together
with all easements (including any rights under applicable construction,
operating and/or reciprocal easements agreements) over adjoining real property,
rights of way, hereditaments, interests in or to adjacent streets or alleys or
other real property and all the benefits thereunto belonging and appertaining
to any portion of the Premises.

 

1.02         Term of Lease. The term hereof shall
commence on May 31, 2006 (the “Commencement Date”), and shall expire at
11:59 PM EST on May 31, 2021 (the “Expiration Date”), unless earlier
terminated or extended as provided in this Lease (the “Term”).

 

1.03         Extension Options. Landlord agrees that
Tenant shall have, and it is hereby granted, two (2) successive options (the “Extension
Options”) to extend the Term as to any Property Location or Property
Locations, in Tenant’s sole discretion, for a period of ten (10) years each
(individually, an “Extension Period”, and collectively, the “Extension
Periods”), each such Extension Period to begin respectively upon the
expiration of the initial Term or the prior Extension Period, as the case may
be. All of the terms, covenants and provisions of this Lease shall apply to
each Extension Period with respect to the Property Locations that Tenant elects
to extend, except that Base Rent (as defined in Section 2.01 below) for
each of the Extension Periods shall continue to be adjusted pursuant to the
terms of Sections 1.04 and 2.01 below, payable in equal monthly
installments as Monthly Base Rent (as defined in Section 2.01). In order
to exercise the Extension Options, Tenant shall give Landlord notice of such
exercise (which notice shall identify the Property Locations that are to be
extended) no later than one hundred twenty (120) days prior to the end of the
initial Term of this Lease or the prior

 

 

Extension
Period, as the case may be; provided, however, that if Tenant shall fail to
give the notice within the aforesaid time limit, Tenant’s right to exercise its
option shall nevertheless continue during said one hundred twenty (120) day
period until thirty (30) days after Landlord shall have given Tenant notice of
Landlord’s election to terminate such option (“Landlord’s Notice”), and
Tenant may exercise such option at any time until the expiration of said thirty
(30) day period. It is the intention of the parties to avoid forfeiture of Tenant’s
rights to extend the Term under any of the options set forth in this Lease
through inadvertent failure to give the extension notice within the time limits
prescribed. Accordingly, if Tenant shall fail to give an extension notice to
Landlord for any of the Extension Periods, and if Landlord shall fail to give
Landlord’s Notice to Tenant, then until the expiration of thirty (30) days
following Landlord’s Notice, or until Tenant either exercises its option to
extend or notifies Landlord that it does not intend to exercise said option to
extend, the Term shall be extended automatically from month to month upon all
the terms and conditions then in effect, except that Monthly Base Rent shall be
increased in accordance with Article 8, and in no event shall the Term
extend beyond the last date of the last Extension Period. Upon the failure of
Tenant to exercise one or any of the options herein following Landlord’s
Notice, and, in any event, upon expiration of the last of such Extension
Periods, Tenant shall have no further or additional right to renew or extend
this Lease.

 

1.04         Base Rent Reset. Notwithstanding the
terms and provisions of Section 1.03, upon the commencement of each
Extension Period of this Lease, the Base Rent shall be reset as determined in
accordance with Section 31.24 hereof (the “FMV Reset”). The
parties shall commence the process for determining fair market rent upon Tenant’s
delivery to Landlord of written notice requesting such determination; provided,
however, such notice shall be delivered at least three (3) months, but in no
event earlier than eight (8) months, before the date for exercising the
Extension Option for such Extension Period. The foregoing shall in no way
affect the Base Rent adjustments under Section 2.01; provided, however,
in the event the commencement of an Extension Period shall occur on an
Adjustment Date (as defined in Section 2.01 below), the FMV Reset shall
be the only adjustment to Base Rent.

 

1.05         Lease Year Defined. As used in this
Lease, the term “Lease Year” shall mean (a) if the Commencement
Date is the first (1st) day
of a calendar month, the twelve (12) month period commencing on the
Commencement Date or (b) if the Commencement Date is not the first (1st) day of a calendar month, the
period commencing on the Commencement Date and ending on the last day of the
twelfth (12th) full
calendar month of the Term, and in either case, each succeeding twelve (12)
month period thereafter which falls in whole or in part during the Term.

 

ARTICLE 2.

RENT

 

2.01         Base Rent. Throughout the Term, Tenant
shall pay to Landlord an annual base rent for the Premises (the “Base Rent”),
without notice or demand. The Base Rent for the first Lease Year shall be equal
to Seven Million Nine Hundred Fifty Eight Thousand Six Hundred Sixteen and
75/00 Dollars ($7,958,616.75). Subject to Section 1.04, on June 1, 2009
and every third anniversary thereafter during the Term (the “Adjustment Date”),
the Base Rent shall increase by the lesser of (a) 1.25 multiplied by the
product of (i) the Base Rent in effect immediately prior to the applicable
Adjustment Date and (ii) the CPI Increase (as defined in

 

2

 

Section 31.16)
or (b) 6% of the Base Rent in effect immediately prior to the applicable
Adjustment Date. Base Rent shall be payable in equal monthly installments
(hereinafter referred to as “Monthly Base Rent”), in advance, on the
first (1st) day of the
Term and on the first (1st) day
of each calendar month thereafter of the Term. If the Term begins on any day
except the first (1st) day
of a calendar month or ends on any day except the last day of a calendar month,
the Monthly Base Rent shall be prorated by multiplying the Monthly Base Rent by
a fraction, the numerator of which is the number of days remaining in the month
(including the Effective Date) and the denominator of which is the total number
of days in such month.

 

2.02         Manner of Payment. Upon the Effective
Date, Landlord shall deliver to Tenant a confirmation of Landlord’s account
information allowing Tenant to establish arrangements whereby payments of the
Base Rent and all other amounts becoming due from Tenant to Landlord hereunder
are transferred by Automated Clearing House Debit initiated by Tenant from an
account established by Tenant at a United States bank or other financial
institution to such account as Landlord may designate. Tenant shall continue to
pay all Base Rent by Automated Clearing House Debit unless otherwise designated
from time to time by written notice from Landlord to Tenant.

 

2.03         Net Lease. It is the intention of the
parties hereto that the obligations of Tenant hereunder shall be separate and
independent covenants and agreements, that any Base Rent, Impositions and all
other sums payable by Tenant hereunder (hereinafter collectively referred to as
“Rent”) shall continue to be payable in all events, and that the
obligations of Tenant hereunder shall continue unaffected, unless the
requirement to pay or perform the same shall have been terminated or reduced
pursuant to an express provision of this Lease or by operation of law. This is
a net lease and Base Rent, Impositions, and all other items of Rent and all
other sums payable hereunder by Tenant shall be paid without notice or demand,
and without setoff, counterclaim, abatement, deferment, or deduction, except as
otherwise specifically set forth herein or provided by Laws (as defined in Section
4.02), and Tenant shall enforce any rights against Landlord in an
independent action; provided, however, in no event shall Tenant be liable for
any interest, principal, late fees or other expenses relating to any debt
incurred by Landlord or other costs incurred by Landlord in financing or
refinancing the Premises. Except as provided under bankruptcy, insolvency,
reorganization or other proceeding affecting Landlord, Tenant agrees that,
except as otherwise expressly provided herein, it shall not take any action to
terminate, rescind or avoid this Lease notwithstanding (a) the exercise of any
remedy, including foreclosure, under any Mortgage (as defined in Section
17.01 below), (b) any action with respect to this Lease (including the
disaffirmance hereof) which may be taken by Landlord under the Federal
Bankruptcy Code or otherwise, (c) a Condemnation of the Premises or any portion
thereof (except as expressly provided herein), (d) the prohibition or
restriction of Tenant’s use of the Premises under any Laws (as defined in Section
4.02 below), or (e) a Casualty Event affecting the Premises or any
portion thereof (except as expressly provided herein).

 

ARTICLE 3.

IMPOSITIONS

 

3.01         Tenant to Pay Impositions. Tenant shall
pay or cause to be paid, directly to the applicable taxing authority (except as
otherwise expressly set forth in Section 30.01 hereof) in a timely
manner and as hereinafter provided, all of the following items, if any, to the
extent that

 

3

 

such items
arise out of the use, ownership or operation of each Property Location that
accrue during the Term (each, an “Imposition” and collectively, the “Impositions”):
(a) real property taxes and assessments; (b) taxes on personal property, trade
fixtures and improvements located on or relating to the Premises, whether
belonging to Landlord or Tenant; (c) occupancy and rent taxes; (d) levies; (e)
gross receipts, excise or similar taxes (i.e., taxes customarily based upon
gross income or receipts which fail to take into account deductions relating to
any Property Location) imposed or levied upon, assessed against or measured by
Base Rent or other Rent payable hereunder, but only to the extent that such
taxes would be payable if such Property Location (together with any other
Property Locations owned by Landlord and subject to this Lease) were the only
properties of Landlord; (f) all excise, franchise, privilege, license,
sales, value added, use and similar taxes imposed upon the Rent or other monies
owed hereunder, or upon the leasehold estate of either party (other than,
transfers, sales or similar taxes imposed in connection with a direct or
indirect transfer of Landlord’s leasehold estate); (g) payments in lieu of
each of the foregoing, whether or not expressly so designated; (h) fines,
penalties and other similar or like governmental charges applicable to any of
the foregoing and any interest or costs with respect thereto solely
attributable to the acts of Tenant; and (i) any and all other federal,
state, county and municipal governmental and quasi-governmental levies,
assessments or taxes and charges, general and special, ordinary and extraordinary,
foreseen and unforeseen, of every kind and nature whatsoever, and any interest
or costs with respect thereto, which are due and payable or accrue at any time
during the Term. Each such Imposition, or installment thereof, during the Term
shall be paid before the last day the same may be paid without fine, penalty,
interest or additional cost; provided, however, that if, in accordance with
Laws, any Imposition may, at the option of the taxpayer, be paid in
installments (whether or not interest shall accrue on the unpaid balance of
such Imposition) (“Installments”), Tenant may exercise the option to pay
the same in such Installments and shall be responsible for the payment of such
Installments only, provided that all such Installment payments relating to
periods prior to the expiration of the Term are required to be made prior to
the Expiration Date or early termination of this Lease. Notwithstanding
anything contained in this Section 3.01 to the contrary, (i) ”Impositions”
shall include all real property taxes and assessments which were assessed,
levied or imposed or which accrued prior to the Term if payable during the
Term, and Tenant shall promptly pay such items as and when they become due and
payable, and (ii) any real property taxes and assessments which accrue
during the Term but become payable after the Term shall continue to be Tenant’s
obligation or responsibility to pay.

 

3.02         Receipt of Payment. Tenant shall
furnish to Landlord, within thirty (30) days after each Imposition is due,
evidence reasonably satisfactory to Landlord evidencing the payment of an
Imposition. Landlord and Tenant shall notify the appropriate governmental
authorities to deliver bills or invoices for Impositions directly to Tenant. Notwithstanding
anything in this Lease to the contrary, if Landlord and Tenant are unable,
after having made commercially reasonable efforts to do so, to cause direct
billing of Impositions to Tenant’s address, and Landlord fails to promptly (but
in any event within ten (10) business days after receipt thereof), deliver to
Tenant any bill or invoice with respect to any Impositions that Landlord may
receive and Tenant’s payment of such Impositions within twenty (20) business
days after receipt of the tax bill results in the imposition of interest,
penalties and/or late fees, then Landlord shall be responsible for such
interest, penalties and/or late fees.

 

4

 

3.03         Exclusions.

 

(a)           Except as provided in Section
3.03(b) hereinbelow, nothing contained in this Article 3 shall
require Tenant to pay foreign, state, local or federal income, inheritance,
estate, succession, capital levy, capital stock, stamp, transfer (except
transfers occurring as a result of Tenant exercising its right of substitution
under Section 12.05 hereof), excess profit, revenue, gift or similar
taxes of Landlord. For these purposes, income taxes shall include
(i) taxes, however labeled, determined by reference to income, and
(ii) any tax, however labeled, imposed on one or more alternative bases,
where one or more of such alternative bases is based on income and the tax is
in fact imposed on the income base; provided, however, that the maximum
additional amount of Impositions with respect to a calendar year that Tenant
may be responsible for hereunder as a result of the inclusion of “and the tax
is in fact imposed on the net income base” may not exceed $50,000. Where a tax
may be imposed on one or more alternative bases, one or more of which is based
on income, and it is not in fact imposed on the income base, the tax actually
imposed will be treated as an income tax hereunder to the extent of the amount
that would have been imposed had the tax been imposed on an income base.

 

(b)           If, at any time during
the Term, a tax or excise on Base Rent or other Rent or the right to receive
rents or other tax, however described, is levied or assessed against Landlord
as a substitute in whole or in part for any Impositions theretofore payable by
Tenant, Tenant shall pay and discharge such tax or excise on Base Rent or other
Rent or other tax before interest or penalties accrue, and the same shall be
deemed to be an Imposition levied against the Premises.

 

3.04         Contest. Tenant shall have the right to
contest (in the case of any item involving more than $10,000, after written
notice to Landlord) the amount or validity, in whole or in part, of any
Imposition by appropriate legal proceedings diligently conducted in good faith,
at Tenant’s sole cost and expense, provided that (a) no Default (as defined in Section
16.01 below) by Tenant has occurred and is continuing; (b) such proceeding
shall be permitted under and be conducted in accordance with the provisions of
any other instrument to which Tenant is bound as a direct party and any REAs
(as defined in Section 9.04 below) and shall not constitute a default
thereunder and such proceeding shall be conducted in accordance with all
applicable Laws; (c) no Property Location nor any part thereof or interest
therein will be in danger of being sold, forfeited, terminated, cancelled or
lost as a result of such proceedings; (d) such proceeding shall suspend the
collection of such contested Imposition from the applicable Property Location;
and (e) Tenant shall furnish such security as may be required by the appropriate
governmental authorities in connection with the proceeding. Upon the
termination of such proceedings, it shall be the obligation of Tenant to pay
the amount of such Imposition or part thereof as finally determined in such
proceedings, the payment of which may have been deferred during the prosecution
of such proceedings, together with any costs, fees (including attorneys’ fees
and disbursements), interest, penalties or other liabilities in connection
therewith.

 

3.05         Reduction of Assessed Valuation. Subject
to the provisions of Section 3.04, Tenant shall have the right to
seek a reduction in the assessed valuation of each Property Location for real
property tax purposes and to prosecute any action or proceeding in connection
therewith.

 

3.06         Joinder of Landlord. Landlord shall
join and reasonably cooperate in any proceedings referred to in Sections
3.04 and 3.05 or permit the same to be brought in its name

 

5

 

but shall not
be liable for the payment of any costs or expenses in connection with any such
proceedings, and Tenant shall reimburse (as incurred) and indemnify Landlord
(promptly upon demand) for any and all costs or expenses which Landlord may
sustain or incur in connection with any such proceedings.

 

ARTICLE 4.

USE; COMPLIANCE

 

4.01         Use. Tenant shall have the right to use
and occupy the Premises for any retail purpose or for any other use or purpose
permitted by the applicable zoning authority and otherwise by Laws and, as
applicable, any REAs. Tenant shall have the right to cease operations for
business (“go dark”) in up to ten percent (10%) of the aggregate of the (a)
rentable square footage of the Premises covered by this Lease at the time of
determination, and (b) rentable square footage of the leased premises
under the Other Lease at the time of determination. Notwithstanding the
foregoing, (i) as to any particular Property Location, if less than fifty
percent (50%) of the rentable square footage of such Property Location is not
operating for business, no portion of such Property Location shall be
considered “dark”, (ii) no portion of a Property Location shall be considered “dark”
unless such Property Location is “dark” for more than twelve (12) consecutive
months, (iii) no portion of a Property Location shall be considered “dark” if
Tenant ceases business operations in such Property Location in connection with
a casualty, condemnation, Capital Improvement (as defined in Article 11)
or Force Majeure (as defined in Section 31.10), and (iv) Tenant
shall have the right to “go dark” in the corporate headquarters and such
Property Location shall not count against the ten percent (10%) limitation set
forth above. Tenant shall provide Landlord with written notice of a “go dark”
Property Location, and an officer’s certificate of Tenant (1) certifying
compliance with all of the square footage requirements set forth in the
foregoing subsections (a), (b) and (i), and the other requirements or
conditions set forth in the foregoing subsections (ii), (iii) and (iv), and (2)
attaching a schedule of square footage calculations in support thereof
(provided, however, that Tenant’s failure to deliver such notice and officer’s
certificate to Landlord shall not constitute a default under this Lease). Notwithstanding
the foregoing, the terms and provisions of this Lease and Tenant’s obligations
hereunder (including without limitation, the payment of Base Rent and other
Rent without reduction except as set forth in Articles 14 and 15,
the maintenance of insurance as required under Article 6 and Tenant’s
maintenance obligations under Section 9.02) shall remain in full force
and effect with respect to any Property Location that has gone “dark”.

 

4.02         Compliance. Tenant’s use and occupation
of each of the Property Locations, and the condition thereof, shall, at Tenant’s
sole cost and expense, comply fully with all Legal Requirements (defined
below), and all restrictions, covenants and encumbrances of record (including
any owner obligations under such Legal Requirements), with respect to the
Premises, in either event, the failure with which to comply could have a
Material Adverse Effect (defined below). Without in any way limiting the
foregoing provisions, Tenant shall comply with all Legal Requirements relating
to money laundering, anti-terrorism, trade embargos, economic sanctions, and
the Americans with Disabilities Act of 1990, as such act may be amended from
time to time, and all regulations promulgated thereunder, as they affect the
Premises now or hereafter in effect. Tenant shall comply with all Legal
Requirements and directives of governmental authorities and, upon receipt
thereof, shall provide to Landlord copies of all notices, reports and other
communications exchanged with, or received from, governmental

 

6

 

authorities
relating to any actual or alleged noncompliance event, the failure of which to
comply could have a Material Adverse Effect. Tenant shall also reimburse
Landlord for all Costs (defined below) incurred by Landlord in evaluating the
effect of such an event on the Premises and this Lease (to the extent Tenant is
not using reasonable efforts to comply with such an event and Landlord makes a
reasonable and good faith determination that such evaluation is necessary), in obtaining
any necessary licenses from governmental authorities as may be necessary for
Landlord to enforce its rights hereunder, and in complying with all Legal
Requirements applicable to Landlord as the result of the existence of such an
event, and for any penalties or fines imposed upon Landlord as a result thereof.
Tenant will use commercially reasonable efforts to prevent any act or condition
to exist on or about the Premises which will materially increase any insurance
rate thereon except when such acts are required in the normal course of its
business, and in any event, Tenant shall pay for such increase; provided,
however, the foregoing provision shall not in any way prevent Tenant from
having the right to use and occupy the Premises in accordance with Section
4.01 above. Except to the extent of Landlord’s willful wrongful acts or
gross negligence (provided that the term “gross negligence” used in this
Section shall not include gross negligence imputed as a matter of law to any of
the Landlord Indemnified Parties (as defined in Section 13.03(a)) solely
by reason of Landlord’s interest in any Property Location or Tenant’s failure
to act in respect of matters which are or were the obligation of Tenant under
this Lease), Tenant agrees that it will defend, indemnify and hold harmless the
Landlord Indemnified Parties from and against any and all Losses (defined
below) caused by, incurred or resulting from Tenant’s failure to comply with
its obligations under this Section.

 

For purposes hereof:

 

“Costs” means all reasonable costs and expenses incurred by a
Person (defined in Section 20.05 below), including, without limitation,
reasonable attorneys’ fees and expenses, court costs, expert witness fees,
costs of tests and analyses, travel and accommodation expenses, deposition and
trial transcripts, copies and other similar costs and fees, and appraisal fees,
as the circumstances require.

 

“Laws” means any constitution, statute, rule of law, code,
ordinance, order, judgment, decree, injunction, rule, regulation, policy,
requirement or administrative or judicial determination, even if unforeseen or
extraordinary, of every duly constituted governmental authority, court or
agency, now or hereafter enacted or in effect.

 

“Legal Requirements” means the requirements of all present and
future Laws (including, without limitation, Environmental Laws (defined in Section
25.01(b) below) and Laws relating to accessibility to, usability by, and
discrimination against, disabled individuals), all judicial and administrative
interpretations thereof, including any judicial order, consent, decree or
judgment, and all covenants, restrictions and conditions now or hereafter of
record which may be applicable to the Property Locations, or to the use, manner
of use, occupancy, possession, operation, maintenance, alteration, repair or
restoration of any of the Property Locations, even if compliance therewith
necessitates structural changes or improvements or results in interference with
the use or enjoyment of any of the Property Locations.

 

7

 

“Losses” means any and all claims, suits, liabilities
(including, without limitation, strict liabilities), actions, proceedings,
obligations, debts, damages, losses, Costs, fines, penalties, interest, charges,
fees, judgments, awards, amounts paid in settlement and damages of whatever
kind or nature, inclusive of bodily injury and property damage to third parties
(including, without limitation, attorneys’ fees and other Costs of defense).

 

“Material Adverse Effect” means a material adverse effect on
(a) any of the Property Locations, including, without limitation, the
operation of any of the Property Locations and/or the value of any of the
Property Locations; (b) Tenant’s ability to perform its obligations under
this Lease; or (c) Landlord’s interests in any of the Property Locations
or this Lease.

 

ARTICLE 5.

UTILITIES

 

5.01         Payment for Utilities. Tenant will pay,
when due, all such charges which accrue during the Term of every nature, kind
or description for utilities furnished to any Property Location or chargeable
against any Property Location, including all charges for water, sewage, heat,
gas, light, garbage, electricity, telephone, steam, power, or other public or
private utility services. Prior to commencement of the Term, Tenant shall pay
for all utilities or services at any Property Location used by it or its
affiliates, agents, employees or contractors.

 

5.02         Utilities. Tenant shall have the right
to choose and shall be responsible for contracting directly with all suppliers
of utility services. In the event that any charge or fee is required by the
state in which any Property Location is located or by any agency, subdivision
or instrumentality thereof, or by any utility company or other entity furnishing
services or utilities to such Property Location, as a condition precedent to
furnishing or continuing to furnish utilities or services to such Property
Location, such charge or fee shall be deemed to be a utility charge payable by
Tenant. The provisions of this Article 5 shall include, but shall not be
limited to, any charges or fees for present or future water or sewer capacity
to serve each Property Location, any charges for the underground installation
of gas or other utilities or services, and other charges relating to the
extension of or change in the facilities necessary to provide each Property
Location with adequate utility services. Tenant may elect to cause the separate
metering of utilities to various portions of any Building. If Tenant makes such
an election, the costs of such separate metering shall be at the sole and
exclusive cost of Tenant. In the event Tenant fails to pay any such charge or
fee contemplated by this Section 5.02, Landlord shall have the
right, but not the obligation, to pay such charges or fees on Tenant’s behalf
and Tenant shall reimburse Landlord for such utility charge upon Landlord’s
demand therefor with interest accruing at the rate provided in Section 31.07.
The inability of Tenant to obtain, or any stoppage of, the utility services
referred to in this Article 5 resulting from any cause (other than
Landlord’s gross negligence or willful wrongful acts) shall not make Landlord
liable in any respect for damages of any kind to any Person, property or
business, or entitle Tenant to any abatement of Rent or other relief from any
of Tenant’s obligations under this Lease.

 

8

 

ARTICLE 6.

INSURANCE

 

6.01         Tenant’s Insurance.

 

(a)           Tenant shall obtain and
maintain the following coverages for all properties at its sole cost and
expense (provided, however, upon the satisfaction of the Cross-Default
Termination Tests under Section 16.01(j) the coverages for Tenant shall
be as set forth on Schedule 6.01 attached hereto):

 

(i)            “All Risk” or “Special
Form” Property Insurance with a One Hundred Million Dollars ($100,000,000) per
occurrence limit, with no aggregate for the peril of windstorm, tornado and
hail, on the Buildings and Tenant’s Personalty (as defined in Section 7.02)
located on each Property Location, (1) in an amount equal to one hundred
percent (100%) of the full replacement cost, (2) containing an agreed
amount endorsement waiving all co-insurance provisions; (3) providing for
no deductible in excess of (a) One Hundred Thousand Dollars ($100,000) or (b)
in the event that the Insurance Deductible Letter of Credit (defined below) is
in full force and effect, Five Hundred Thousand Dollars ($500,000); and
(4) providing coverage for contingent liability from Operation of Building
Laws, Demolition Costs and Increased Cost of Construction under an “Ordinance
or Law Coverage” or “Enforcement” endorsement if any of the improvements or the
use of each individual Property Location shall at any time constitute legal
non-conforming structures or uses. The full replacement cost shall be
redetermined from time to time (but not more frequently than once in any
twenty-four (24) calendar months) at the request of Landlord by an appraiser or
contractor designated and paid by Tenant and approved by Landlord, or by an
engineer or appraiser in the regular employ of the insurer and at the expense of Tenant. After the first
appraisal, additional appraisals may be based on construction cost indices
customarily employed in the trade. For purposes of this Section 6.01(a)(i),
the term “Insurance Deductible Letter of Credit” shall mean a letter of
credit, combined for ShopKo Stores Operating Co., LLC (“ShopKo”) and
Pamida Stores Operating Co., LLC (“Pamida”) so long as they jointly
procure insurance, in an amount equal to Four Hundred Thousand Dollars
($400,000.00), naming Landlord or, at Landlord’s option, its Mortgagee (as
defined in Section 17.01 below) as the sole beneficiary thereof, which
letter of credit shall (A) be a transferable, clean, irrevocable, unconditional,
standby letter of credit in form, substance and amount reasonably satisfactory
to Landlord in its reasonable discretion, issued or confirmed by a commercial
bank with a long term debt obligation rating of “AA” or better (or a comparable
long term debt obligation rating) as assigned nationally-recognized statistical
rating agency, (B) be payable upon presentation of a sight draft only to the
order of Landlord or its Mortgagee at a New York City bank, (C) have an initial
expiration date of not less than one (1) year and shall be automatically
renewed for successive twelve (12) month periods for the Term, (D) provide for
multiple draws, and (E) be transferable by Landlord or its Mortgagee, and its
successors and assigns at a New York City bank.

 

(ii)           Commercial General
Liability insurance (“Liability Insurance”) against liability for bodily
injury and death, property damage, personal and advertising injury, liquor (to
the extent liquor is sold or manufactured on any Property Location),
optometrist and druggist professional liability (to the extent optometric and
pharmacy operations exist on any Property Location) on each Property Location,
such Liability Insurance (1) to be on an “occurrence” form with a combined
single limit of not less than One Million Dollars ($1,000,000) per occurrence
and Two Million Dollars ($2,000,000) in the aggregate and to continue at not
less than the aforesaid limit until required to be changed by Landlord in
writing by reason of changed economic conditions making such protection
inadequate; and (2) to provide coverage for premises and operations,
products and completed operations on an “if any”

 

9

 

basis,
independent contractors, blanket contractual liability for all written and oral
contracts and contractual liability covering the indemnities contained in this
agreement. The deductible for Liability Insurance coverage shall not exceed Two
Hundred Fifty Thousand Dollars ($250,000).

 

(iii)          Workers’ Compensation
insurance providing statutory benefits and Employers Liability insurance with a
limit of at least One Million Dollars ($1,000,000) for all Persons employed by
Tenant at or in connection with each Property Location;

 

(iv)          Business
Interruption/Loss of Rents insurance (1) covering all risks required to be
covered by the insurance provided for in Section (i) above; (2) in
an amount equal to one hundred percent (100%) of the projected gross income
from each individual Property Location (on an actual loss sustained basis) for
a period continuing until the restoration of the individual Property Location
is completed; the amount of such business interruption/loss of rents insurance
shall be determined prior to the signing of this Lease and at least once each
year thereafter based on Tenant’s reasonable estimate of the gross earnings
including one hundred percent (100%) of rent payables for the succeeding
twenty-four (24) month period, and (3) containing an extended period of
indemnity endorsement which provides that after the physical loss to the
Buildings, improvements or Tenant’s Personalty has been repaired, the continued
loss or income will be insured until such income either returns to the same
level it was at prior to the loss, or the expiration of six (6) months from the
date that the applicable individual Property Location is repaired or replaced
and operations are resumed, whichever first occurs, and notwithstanding that
the policy may expire prior to the end of such period;

 

(v)           Comprehensive Boiler
and Machinery insurance, if applicable, in an amount equal to the greater of
Five Million Dollars ($5,000,000) or full replacement cost of the Buildings,
improvements and Tenant’s Personalty on terms consistent with the “All Risk”
Property insurance required under subsection (i) above;

 

(vi)          Flood insurance, if any
portion of a Building is located in an area identified by the Secretary of
Housing and Urban Development or any successor thereto as an area having
special flood hazard pursuant to the National Flood Insurance Act of 1968, the
Flood Disaster Protection Act of 1973 or the National Flood Insurance Reform
Act of 1994, as each may be amended, or any successor law (the “Flood
Insurance Acts”), of the following types and in the following amounts
(1) coverage under policies issued pursuant to the Flood Insurance Acts
(the “Flood Insurance Policies”) in an amount equal to the maximum limit
of coverage available for the applicable individual Property Location under the
Flood Insurance Acts, subject only to customary deductibles under such policies
and (2) Excess Flood Insurance in an amount equal to the greater of (x)
one hundred percent (100%) of replacement cost of the Buildings (including the
improvements) located in the applicable individual Property Location, or (y)
Ten Million Dollars ($10,000,000) for Property Locations outside Flood Zone A
or V;

 

(vii)         Earthquake insurance for
locations with Probable Maximum Loss percentages of 20 (PML 20%) or greater,
and sinkhole and mine subsidence insurance in amounts equal to one times (1x)
the probable maximum loss of each individual Property Location as determined by
Landlord in its sole discretion and in form and substance satisfactory to
Landlord, provided that with the exceptions for limits and deductibles the
Earthquake

 

10

 

insurance
shall be on terms consistent with the “All Risk” Property insurance under subsection
(i) above:

 

(viii)        Umbrella Liability
insurance in an amount not less than Seventy Five Million Dollars ($75,000,000)
per occurrence on the forms of Primary Commercial General Liability, Employers
Liability, Optometrist Professional Liability and Druggist Professional
Liability;

 

(ix)           At all times during
which structural construction, repairs or alterations (including Capital Improvements)
are being made with respect to the Buildings and the other improvements
(1) Owner’s Contingent or Protective Liability insurance covering claims
not covered by or under the terms or provisions of the insurance provided in Section
(ii) above; and (2) Builders Risk insurance on a completed value form
covering against “all risks” insured against pursuant to Section (i)
above shall include permission to occupy each individual Property Location, and
shall contain an agreed amount endorsement waiving coinsurance provisions;

 

(x)            Insurance against
terrorism, terrorist acts or similar acts of sabotage (“Terrorism Insurance”)
with coverage amounts of not less than Seventy Five Million and 00/100 Dollars
($75,000,000.00) (the “Terrorism Insurance Required Amount”). Notwithstanding
the foregoing sentence, Tenant shall not be obligated to expend more than
Seventy Five Thousand Dollars ($75,000), increased annually based on increases
in the CPI, in any fiscal year on insurance premiums for Terrorism Insurance
(the “Terrorism Insurance Cap”). If the cost of the Terrorism Insurance
Required Amount exceeds the Terrorism Insurance Cap, Tenant shall purchase the
maximum amount of Terrorism Insurance available with funds equal to the
Terrorism Insurance Cap;

 

(xi)           With respect to each
Property Location on which Tenant maintains a tank for the storage of Hazardous
Materials, storage tank liability insurance that provides for corrective
action, third party liability coverage, clean-up
costs and defense costs at all times during the Term in an amount not less than
those limits required to satisfy the financial responsibility requirements as
determined by Title 40 the Code of Federal Regulations, but in no event less
than Two Million Dollars ($2,000,000) per occurrence and Four Million Dollars
($4,000,000) in the aggregate (“Tank Insurance”); and

 

(xii)          Such other insurance and
in such amounts from time to time that Landlord or its Mortgagee may reasonably
request against such other insurable hazards which at the time are commonly
insured against for property similar to each individual Property Location in or
around the region in which the each individual Property Location is located.

 

(b)           Landlord shall be named
as an “additional insured” for Liability Insurance, as an “additional named
insured” and as a “loss payee” for Property Insurance, as an “additional
insured” for Tank Insurance, and as a “loss payee” for rental value or business
interruption insurance. If any Property Location shall be subject to any
Mortgage (as defined in Section 17.01), the applicable Liability
Insurance shall, if required by such Mortgage, name the Mortgagee (as defined
in Section 17.01) as an additional insured and the Property, Business
Interruption/Loss of Rents, Boiler and Machinery, Flood, Earthquake and
Terrorism insurance

 

11

 

shall name the
Mortgagee as a “loss payee” under a standard “noncontributory mortgagee”
endorsement or its equivalent. In the case of Property, Boiler and Machinery,
and Flood insurance, each policy shall contain a so-called New York standard
non-contributing mortgagee clause in favor of any Mortgagee providing that the
loss thereunder shall be payable to Landlord and Mortgagee, as their interests
may appear.

 

(c)           All of Tenant’s
insurance policies required hereunder shall be in such form and shall be issued
by such responsible companies permitted to do business in the state where the
applicable Property Location is located. All such companies shall have a rating
of “A” or better for financial strength claims paying ability assigned by Moody’s
Investors Service, Inc. (if Moody’s Investors Service, Inc. provides a rating
for the insurer) and a rating of ”A” or better assigned by Standard &
Poor’s Rating Group (“S&P”), provided that if any insurance required
is provided by a syndicate of insurers, the insurers with respect to such
insurance shall be acceptable if: (1) the first layer of coverage under such
insurance shall be provided by carriers with a minimum financial strength
rating from S&P of “A” or better; (2) sixty percent (60%)
(seventy-five percent (75%) if there are four or fewer members in the
syndicate) of the aggregate limits under such policies must be provided by
carriers with a minimum financial strength rating from S&P of “A” or
better; and (3) the financial strength rating from S&P for each carrier in
the syndicate shall have a financial strength rating from S&P of at least “BBB”.
All policies referred to in this Lease shall be procured, or caused to be
procured, by Tenant, at no expense to Landlord, and for periods of not less
than one (1) year. Evidence of insurance (in form and substance reasonably
acceptable to Landlord) shall be delivered to Landlord on or before the
Commencement Date and renewal evidence of insurance not less than ten (10) days
prior to the date of expiration of the policies. Subject to the terms of Section
30 below, if Tenant fails to obtain and maintain insurance coverages in
accordance with this Article 6, then Landlord, at Landlord’s sole
option, upon fifteen (15) days prior written notice to Tenant and Tenant’s
failure to cure within said period, may, but shall not be obligated to, procure
such insurance on behalf of, and at the expense of, Tenant, and if Landlord
exercises such right and expends any funds to obtain such insurance, Tenant
shall reimburse Landlord for such amounts upon demand with interest accruing at
the Default Interest rate provided in Section 31.07, from the time of
payment by Landlord until fully paid by Tenant immediately upon written demand
therefor by Landlord. It is understood that any such sums for which Tenant is
required to reimburse Landlord shall constitute Rent under this Lease.

 

(d)           Tenant shall not carry
separate insurance concurrent in form or contributing in the event of loss with
that required by this Lease to be furnished by Tenant, unless Landlord and each
Mortgagee is included therein as additional named insureds with any loss
payable as provided in this Lease. Tenant shall promptly notify Landlord of the
carrying of any such separate insurance and shall cause evidence of the same to
be delivered as required in this Lease.

 

(e)           Tenant shall not
violate or permit to be violated any of the conditions or provisions of any of
Tenant’s insurance policies required hereunder, and Tenant shall so perform and
satisfy or cause to be performed and satisfied the requirements of the
companies writing such policies so that at all times companies of good standing
shall be willing to write and continue such insurance.

 

12

 

(f)            Each of Tenant’s
insurance policies shall contain an agreement by the insurer that such policy
shall not be cancelled or modified without at least ten (10) days’ prior
written notice to Landlord and each Mortgagee, and contain clauses or
endorsements to the effect that no act or negligence of Tenant, or anyone
acting for Tenant, or failure to comply with the provisions of any policy which
might otherwise result in a forfeiture of the insurance or any part thereof,
shall in any way affect the validity or enforceability of the insurance insofar
as Landlord is concerned. The Property Insurance shall contain a waiver of
subrogation by the insurer of any right to recover the amount of any loss
resulting from the acts or negligence of Landlord or its agents, employees or
licensees.

 

(g)           Each of Landlord and
Tenant hereby waives any and every claim for recovery from the other for any
and all loss or damage to any Property Location or to the contents thereof, whether
such loss or damage is due to the negligence of Landlord or Tenant or their
respective agents or employees, which loss or damage is insured pursuant to
this Lease; provided, however, that the foregoing waiver shall not be operative
in any case where the effect thereof is to invalidate any insurance coverage of
the waiving party or increase the cost of such insurance coverage. Each of
Landlord and Tenant hereby waive all rights of subrogation that they may have
against each other.

 

(h)           It is expressly
understood and agreed that (1) if any insurance required hereunder, or any part
thereof, shall expire, be withdrawn, become void by breach of any condition
thereof by Tenant, or become void or in jeopardy by reason of the failure or
impairment of the capital of any insurer, Tenant shall immediately obtain new
or additional insurance reasonably satisfactory to Landlord and its Mortgagee;
(2) the minimum limits of insurance coverage set forth in this Section 6.01
shall not limit the liability of Tenant for its acts or omissions as provided
in this Lease; (3) Tenant shall procure policies for all insurance for periods
of not less than one year and shall provide to Landlord and any servicer or
Mortgagee of Landlord certificates of insurance or, upon Landlord’s request,
duplicate originals of insurance policies evidencing that insurance satisfying
the requirements of this Lease is in effect at all times; and (4) Tenant shall
pay as they become due all premiums for the insurance required by this Section
6.01.

 

6.02         Blanket Policy. Property Insurance, at
the option of Tenant, may be effected by blanket policies issued to Tenant
covering the entire Premises (or any portion thereof) and other properties
owned or leased by Tenant, provided that the policies otherwise comply with the
provisions of this Lease.

 

ARTICLE 7.

RETURN OF PREMISES

 

7.01         Surrender of Possession. At the
expiration or early termination of this Lease, Tenant shall surrender
possession of the Premises to Landlord and deliver all keys to each of the Buildings
to Landlord and make known to Landlord the combination of all locks of vaults
then remaining in each of the Buildings, and, subject to the following
paragraph, shall return each Property Location and all equipment and fixtures
of Landlord therein to Landlord in good working condition (subject to Tenant’s
rights contained in Article 11 and Section 9.02), reasonable
wear and tear, casualty and condemnation excepted.

 

13

 

7.02         Trade Fixtures and Personal Property. Tenant’s
merchandise, furniture, machinery, trade fixtures, non-trade fixtures,
inventory and other items of personal property of every kind and description
(collectively, “Tenant’s Personalty”), shall belong to Tenant throughout
the Term, and Tenant shall have the right to remove Tenant’s Personalty from
each Property Location and the obligation to restore any damage to the
applicable Property Location caused thereby, such removal and restoration to be
performed prior to the end of the Term or within twenty (20) days following
termination of this Lease or Tenant’s right of possession, whichever is earlier.
If Tenant fails to remove such items, Landlord may do so and thereupon the
provisions of Section 16.04 shall apply.

 

7.03         Survival. All obligations of Tenant
under this Article 7 shall survive the expiration of the Term or earlier
termination of this Lease.

 

ARTICLE 8.

HOLDING OVER

 

If Tenant remains in possession of any Property Location after the
expiration of the Term, Tenant, at Landlord’s option and within Landlord’s sole
discretion, may be deemed a tenant on a month-to-month basis and shall continue
to pay Rent, except that Tenant shall pay Landlord one hundred twenty-five
percent (125%) of the Base Rent then applicable to the final Lease Year of the
Term for the period Tenant remains in possession of such Property Location. The
foregoing provisions shall not serve as permission for Tenant to holdover, nor
serve to extend the Term (although Tenant shall remain bound to comply with all
provisions of this Lease until Tenant vacates each Property Location, and shall
be subject to the provisions of Article 7).

 

ARTICLE 9.

CONDITION AND CARE OF PREMISES

 

9.01         As-Is Condition. Tenant acknowledges
and agrees that Tenant accepts each Property Location in “AS-IS, WHERE-IS”
condition and agrees that Landlord makes no representation or warranty as to
the condition thereof. Tenant further acknowledges and agrees that, prior to
the Commencement Date, Tenant or an affiliate of Tenant has been in sole and exclusive
possession and control of each Property Location.

 

9.02         Tenant’s Obligations. Subject to Tenant’s
rights set forth in Article 11 below and this Section 9.02,
Tenant shall maintain, or cause to be maintained, in good working order each
Property Location, including the Building and any other improvements located
thereon, the equipment serving the Building, and the other improvements located
thereon, including, without limiting the generality of the foregoing, roofs,
foundations and appurtenances to the Building, all mechanical, electrical,
plumbing, and heating, air-conditioning and ventilation systems located in or
otherwise serving such Building, and all water, sewer and gas connections,
pipes and mains which service such Building which neither any public utility
company nor a public authority is obligated to repair and maintain, and shall
put, keep and maintain each Building, and the other improvements on such Parcel
in good working order and make all repairs therein and thereon, interior and
exterior, structural and nonstructural, necessary to keep the same in good
working order and to comply with all applicable Laws, howsoever the necessity
or desirability therefor may occur. When used in this Lease, the term “repairs”
shall include all alterations, installations,

 

14

 

replacements,
removals, renewals and restorations, and the phrase “good working order” or “good
working condition” means good working order or good working condition,
reasonable wear and tear, casualty and condemnation excepted. Notwithstanding
the foregoing, (a) Tenant also shall perform common area maintenance and
repairs and other duties with respect to any Property Location or any adjoining
property to the extent that Landlord is required to do so under any REAs
(whereupon Tenant shall be entitled to reimbursement from any third party
pursuant to any such REAs), and (b) so long as no Default has occurred and
is continuing and subject to Tenant’s obligation to maintain each Property Location
in good working order as set forth above, Tenant shall not be required to make
any structural or capital repairs or improvements to the Premises during the
last two (2) years of the Term. For purposes of this Section 9.02, “the
last two (2) years of the Term” refers to the final years of the Term, as
extended, and Tenant’s obligations to repair and maintain the Premises will
continue during the last two (2) years of the initial Term or any Extension
Period for which Tenant has exercised its Extension Option.

 

9.03         Landlord Not Obligated. Landlord shall
not be required to furnish any services, utilities or facilities whatsoever to
the Premises, nor shall Landlord have any duty or obligation to make any
alteration, change, improvement, replacement, restoration or repair to, or to
demolish, the Buildings or any other improvements presently or hereafter
located on the Parcels. Tenant assumes the full and sole responsibility for the
condition, operation, repair, alteration, improvement, replacement, maintenance
and management of the Premises, including any Building or any other
improvements.

 

9.04         Compliance with REA(s). Notwithstanding
anything to the contrary contained herein, it is expressly understood and
agreed by and between Landlord and Tenant that the Property Locations may be
subject to construction, operating, development, cross easement and reciprocal
easement agreements or other declarations, covenants, restrictions or easement
agreements in effect as of the Effective Date, or subsequently entered into as
provided in this Section 9.04 or Article 26, in favor of an owner
of adjoining property or to which Landlord is a party or which is binding on
Landlord or the Premises or which is a matter of public record affecting such
Property Location or any portions thereof, or any similar agreements, as may be
amended from time to time (hereinafter each referred individually as an “REA”
and collectively as the “REAs”), and Tenant, for itself and any
permitted assignee or subtenant, hereby covenants and agrees to comply with,
perform all obligations (whether those of Tenant or Landlord) under and not
violate any provision of the REAs. Tenant shall pay or cause to be paid, in a
timely manner, all charges, costs and other obligations imposed on or with
respect to the Premises or Landlord pursuant to any REAs. Neither Landlord nor
Tenant shall grant or agree to any new REA affecting a Property Location or to
any consents, approvals, waivers, modifications, amendments or terminations of
any REA in existence as of the Effective Date (collectively, an “REA Change”)
without the prior written consent of the other party in each instance, which
consent shall not be unreasonably withheld, delayed or conditioned; provided,
however, with respect to the development of previously subdivided outlots owned
by Tenant that are not part of the Premises, Tenant shall have the right to
consent to such outlot development on behalf of Landlord under any REA (or
Landlord shall execute a consent, in form and substance reasonably satisfactory
to Landlord, upon the reasonable request of Tenant) so long as Tenant
represents to Landlord that such development does not materially and adversely
affect the use or operation of or access to or from the applicable Property
Location and the development will not (a) cause any portion of such
Property Location to be in violation of any Legal Requirements, (b) create
any

 

15

 

liens on such
Property Location, or (c) violate the terms of any document or instrument
of record encumbering such Property Location, including without limitation, any
REA. In any instance in which a party requests the consent of the other party
to an REA Change, the other party shall respond to such request within twenty
(20) days; provided, that if there is no response within said twenty (20) day
period, consent shall be deemed to have been given upon the expiration of said
twenty (20) day period. Landlord agrees that Tenant shall enjoy the access,
parking, easement and right to receive services and benefits that inure to
Landlord under all REAs, concerning such access, parking, easement rights or
the right to receive services thereunder. Landlord hereby grants unto Tenant
the rights of enforcement and audit with respect to all of the REAs on Landlord’s
behalf, at Tenant’s sole cost and expense. If Tenant cures a default or
enforces performance by the other owner or other party to an REA in accordance
with an REA and in doing so spends money, or if at the time in question Tenant
is performing the common area maintenance under that REA and the adjacent owner
or other party fails to pay its share of expenses, Landlord grants Tenant, to
the extent granted under the REA, the right to collect reimbursement from the
adjacent owner or the other party to said REA, provided that Landlord shall
have no liability to Tenant with respect to any amounts paid or costs incurred
by Tenant. Landlord agrees that, upon Tenant’s request and at Tenant’s sole
cost and expense, Landlord will enforce the terms of any REAs for the benefit
of Tenant. Except to the extent of Landlord’s willful wrongful acts or gross
negligence (provided that the term “gross negligence” used in this Section
shall not include gross negligence imputed as a matter of law to any of the
Landlord Indemnified Parties solely by reason of Landlord’s interest in any
Property Location or Tenant’s failure to act in respect of matters which are or
were the obligation of Tenant under this Lease), Tenant agrees that it will
defend, indemnify and hold harmless the Landlord Indemnified Parties from and
against any and all Losses arising from or related to a default by Tenant under
the REAs, that continues beyond applicable notice and cure periods, and any
enforcement actions described in this Section. Promptly after the request of
Tenant, Landlord shall execute such documents as may be reasonably requested by
Tenant in connection with any REA so that to the extent permitted by such REA,
(i) Tenant is entitled to directly receive any notices under the REA (with a
required copy to Landlord), (ii) Tenant, together with Landlord, is named as a
co-insured under any insurance policies required to be maintained by any other
party under the REA, (iii) Tenant, together with Landlord, is afforded the
benefit of all rights, easements, licenses and benefits afforded to the
Property Location under the REA, and (iv) Tenant is able to directly enforce
and audit the REA and to directly exercise all rights and remedies in
connection with any breach of the REA by any other party.

 

16

 

9.05         Required Repairs. On the Commencement
Date, Tenant shall deposit with Landlord the sum of Four Hundred Fifty Nine
Thousand Nine Hundred Three and NO/00 Dollars ($459,903.00) (or deliver a
Letter of Credit as defined in Section 30.06(d) in such amount, which
Letter of Credit shall be held and disbursed in the same manner as described in
Section 30.05 hereof with respect to the Letter of Credit for the
Required Repairs), to complete each item of the repairs relating to the
Property Locations described on Exhibit I (the “Required Repairs”)
and Landlord shall hold or cause the Mortgagee to hold such amount for Tenant’s
benefit in an interest-bearing account (which may be a book entry subaccount)
(the “Required Repairs Subaccount”); all interest thereon shall accrue
for the benefit of Tenant. Tenant shall complete the Required Repairs at the
applicable Property Location on or before the deadline for such Required
Repairs as set forth in Exhibit I. Landlord shall disburse or cause the
Mortgagee to disburse the funds held in the Required Repairs Subaccount to
Tenant, within fifteen (15) days after the delivery by Tenant to Landlord of a
request therefor, in an amount greater than Twenty-Five Thousand Dollars
($25,000) (or a lesser amount if the total amount in the Required Repair
Subaccount is less than Twenty-Five Thousand Dollars ($25,000), in which case
only one disbursement of the amount remaining in the account shall be made),
accompanied by the following items: (a) a certificate signed by an officer
of Tenant: (i) stating that the Required Repair which is the subject of
the requested disbursement has been completed, (ii) identifying each Person
that supplied materials or labor in connection with such Required Repairs or
any portion thereof, and (iii) stating that each such Person supplying
materials or labor has been or, upon receipt of the requested disbursement,
will be paid in full with respect to the portion of the Required Repairs which
is the subject of the requested disbursement; (b) copies of appropriate
lien waivers, to the extent applicable, or other evidence of payment reasonably
satisfactory to Landlord; and (c) if requested by Landlord’s Mortgagee, a title
search for such Property Location indicating that such Property Location is
free from all liens, claims and other encumbrances not previously approved by
Landlord. Landlord shall be obligated to make (or cause Mortgagee to make)
disbursements from the Required Repair Subaccount with respect to a Property
Location in the amount allocated for such Property Location set forth in Exhibit
I (even if the cost to complete such work is less than the amount set forth
in Exhibit I) but Landlord shall not be obligated to make (or cause
Mortgagee to make) disbursements in excess of the amount allocated for Property
Location as set forth in Exhibit I. If Tenant does not complete the
Required Repairs at the applicable Property Location by the required deadline
for such Required Repairs, then Landlord may apply such funds to completion of
such Required Repairs. Upon Tenant’s completion of all Required Repairs in
accordance with this Section, Landlord shall release or cause Mortgagee to
release any funds remaining in the Required Repairs Subaccount, if any, to
Tenant.

 

9.06         Warranties. Landlord hereby assigns,
without recourse or warranty whatsoever, to Tenant (to the extent assignable),
(a) all claims against third parties for damages to the Premises to the extent
that such damages are Tenant’s responsibility to repair pursuant to the
provisions of this Lease, and (b) all warranties, guaranties and indemnities,
express or implied, and similar rights which Landlord may have against any
manufacturer, seller, engineer, contractor or builder in respect of any of the
Property Locations, including, but not limited to, any rights and remedies
existing under contract or pursuant to the Uniform Commercial Code
(collectively, the “Warranties”). Tenant shall take all commercially
reasonable action necessary to preserve the rights under the Warranties
assigned hereunder. Upon the occurrence of a Default and the Landlord’s
exercise of its remedies under Section 16.02 hereof or the expiration

 

17

 

or sooner
termination of this Lease, the Warranties shall automatically revert to
Landlord. The foregoing provision of reversion shall be self-operative and no
further instrument of reassignment shall be required.

 

ARTICLE 10.

RIGHTS RESERVED TO LANDLORD

 

Landlord reserves the right, exercisable without notice and without
liability to Tenant for damage or injury to property, Person or business and
without effecting an eviction or disturbance of Tenant’s use or possession or
giving rise to any claim for setoff or abatement of rent or affecting any of
Tenant’s obligations under this Lease, (a) at any time during the one hundred
twenty (120) days prior to the expiration of the Term, to exhibit each Property
Location at reasonable hours upon prior notice to Tenant and giving Tenant the
opportunity to have its representative accompany the group performing such
exhibition, and (b) to decorate, remodel, repair, alter or otherwise
prepare each Property Location for re-occupancy at any time after a Default by
Tenant under this Lease and Tenant surrenders the Premises to Landlord.

 

ARTICLE 11.

ALTERATIONS

 

11.01       Alterations. Tenant shall have the sole
and complete right and authority, without Landlord’s consent or approval but
subject to the provisions contained in any REAs relating to alterations, to
alter or change each Property Location in any way, including, without
limitation, dividing each Property Location (excluding any subdivision of any
land) and adding additional signage; provided that (i) Tenant gives
Landlord prior written notice of any material alterations, and (ii) at any
one time Tenant may not make any proposed structural alterations to any
Property Location in excess of Seven Hundred Fifty Thousand Dollars ($750,000)
per Lease Year, increased annually based on increases in the CPI (as defined in
Section 31.16) (the “Alteration Cap”), without Landlord’s prior
written consent, which consent shall not be unreasonably, withheld, conditioned
or delayed, it being understood, however, that the refusal or failure of
Landlord’s Mortgagee to grant consent (to the extent required and applicable)
to the alterations shall be a reasonable basis for Landlord to withhold its
consent. For the purposes of this Lease, the term “structural” shall mean the
roof, foundation or load-bearing walls of any Building. In addition, Tenant
shall not demolish, replace or materially alter any structural or
non-structural portions of any Building or any other improvements located on a
Property Location, or any part thereof, or make any addition thereto, whether
voluntary or in connection with a repair or Restoration (as defined in Section
14.01) required by this Lease (collectively, the “Capital Improvement”),
unless Tenant shall comply with the following requirements:

 

(a)           Each Capital
Improvement, when completed, shall be of such a character as not to materially
reduce the value of the applicable Property Location below its value
immediately before construction of such Capital Improvement was commenced;

 

(b)           Each Capital
Improvement shall be made with reasonable diligence (subject to Force Majeure)
and in a good and workmanlike manner and in compliance with all applicable
permits and authorizations and, as applicable, any of the REAs. No Capital
Improvement shall impair the safety or structural integrity of the applicable
Building;

 

18

 

(c)           In connection with the
construction of any Capital Improvement, the applicable Property Location and
the assets of Landlord shall (subject to the provisions of Article 26)
at all times be free of liens for work, services, labor and materials supplied
or claimed to have been supplied to the applicable Property Location;

 

(d)           No structural Capital
Improvement shall be undertaken without obtaining the insurance required by Section
6.01 hereof, and “all risk” builder’s risk property insurance for the full
replacement cost of the subject Capital Improvement on a completed value basis;

 

(e)           No Capital Improvement
shall be undertaken until Tenant shall have procured and paid for, insofar as
the same may be required from time to time, all permits and authorizations of
all governmental authorities for such Capital Improvement. Landlord shall join
in the application for such permit or authorization and cooperate with Tenant
and execute any additional documents as may be necessary to allow Tenant to
complete the alterations and changes, provided it is made without cost,
liability, obligation or expense to Landlord. Tenant agrees that it will
defend, indemnify and hold harmless the Landlord Indemnified Parties from and
against any and all Losses arising from or related to construction of any
Capital Improvements and any failure to comply with the requirements in
connection with a Capital Improvement as described in this Section;

 

(f)            All Capital Improvements
shall be deemed a part of the Premises and, except as set forth in Section
7.02, belong to Landlord at the expiration or early termination of the
Term, and Tenant shall execute and deliver to Landlord such instruments as
Landlord may require to evidence the ownership by Landlord of such Capital
Improvements; and

 

(g)           Excluding Capital
Improvements required as a result of any condemnation or casualty or required
to comply with Legal Requirements, the maximum costs of Capital Improvements
that are not substantially complete or not fully paid for by Tenant, at any one
time, shall not exceed Seven Million Five Hundred Thousand Dollars
($7,500,000), increased annually based on increases in the CPI.

 

Upon completion of the Capital Improvements, Tenant shall promptly
provide Landlord with (1) an architect’s certificate certifying that the
Capital Improvements have been completed in conformity with the plans and
specifications therefor (if the alterations are of such a nature as would
customarily require the issuance of such certificate from an architect),
(2) a certificate of occupancy (if the alterations are of such a nature as
would require the issuance of a certificate of occupancy under applicable
Laws), and (3) any other documents or information reasonably requested by
Landlord.

 

ARTICLE 12.

ASSIGNMENT AND SUBLETTING

 

12.01       Assignment. (a) Subject to Section
12.07 below, Tenant shall have the right to assign or transfer this Lease,
either wholly or in part, or any interest hereunder, without Landlord’s consent
or approval, so long as Tenant shall remain liable under this Lease. Upon the
occurrence of any assignment: (i) Tenant shall provide to Landlord notice
thereof, along with a copy of such assignment and an officer’s certificate of
Tenant, in the form attached hereto as

 

19

 

Schedule 12.01,
certifying, if applicable, that the conditions set forth in Section 12.01(b)
below have been satisfied; (ii) Landlord shall enter into a separate lease
with assignee as to that portion of the Premises assigned upon substantially
the same terms and conditions as this Lease (except for such provisions which
by their terms are not applicable to such Premises assigned), including,
without limitation, (1) the base minimum rent per square foot of the
portion of the Premises assigned is equal to or greater than the rent as
determined in accordance with Exhibit B attached hereto and made a part
hereof, (2) the lease term for such assignment is at least equal to the
then remaining Term, and (3) the use of the assigned portion of the
Premises will not violate any Laws or REAs; (iii) (1) the cross-default
provisions of Section 16.01(j) of this Lease shall no longer apply as
between this Lease and any lease of all or any portion of the Premises which
has been assigned to a third party by Tenant in accordance with and pursuant to
the requirements of the provisions of this Section 12.01 (an “Assigned
Lease”) and (2) no default under an Assigned Lease shall constitute a
Default under this Lease and no Default under this Lease shall constitute a
default under an Assigned Lease, and (iv) this Lease shall be amended to
release such Property Location from this Lease and to reduce the Base Rent by
the amount of the rent paid by the assignee, with all other terms and
conditions of this Lease remaining in full force and effect.

 

(b)           Notwithstanding any
provision contained in Section 12.01(a), but subject to the continuing
limitations set forth in Section 12.07 below, as to that portion of the
Premises assigned, Tenant’s obligations under this Lease shall terminate
entirely and, except for any liabilities of Tenant which accrued prior to the
date of assignment, Tenant shall be released of any liability under this Lease
so long as the following conditions are met: (i) the assignee has an
investment rating of “BBB” or better from Standard and Poor’s (or an equivalent
rating or shadow rating from another nationally recognized statistical rating
service), or (ii) at the time of the proposed assignment, the assignee (1) has
a tangible net worth as determined in accordance with generally accepted
accounting principles consistently applied (“Tangible Net Worth”) of at
least Twenty Five Million Dollars ($25,000,000), and (2) meets or exceeds
an EBITDAR Ratio (calculated on a trailing twelve (12) month basis at the time
of such test) (as defined in Section 30.06(c)) of 1.60 to 1, and
(3) has an annual revenue of at least One Hundred Million Dollars
($100,000,000), or (iii) the assignee has a Tangible Net Worth of at least
Two Hundred Fifty Million Dollars ($250,000,000); provided, however, that
Tenant may satisfy any one of the foregoing conditions of assignee by
providing, or causing to be provided, a guaranty agreement, in form and
substance reasonably acceptable to and approved by Landlord, in writing, such
approval not to be unreasonably withheld or delayed, which guaranty shall be
from an entity that meets the requirements of (i), (ii) or (iii) set forth
above in this Section 12.01(b).

 

12.02       Change of Control. The following
transactions, transfers or changes in control or ownership of Tenant shall not
constitute an assignment under the terms of this Lease: (a) a transfer of
Tenant’s entire interest in this Lease to any entity in connection with
intercompany corporate transfers whose ownership is controlled by Tenant or
Tenant’s parent or ultimate parent; or (b) a transfer of Tenant’s entire
interest in this Lease to any entity which has the power to direct Tenant’s
management and operation, or any entity whose management and operation is
controlled by Tenant or Tenant’s parent or ultimate parent or is under common
control with Tenant or Tenant’s parent or ultimate parent; or (c) a transfer of
Tenant’s entire interest in this Lease to any entity, a majority of whose
voting rights are owned by Tenant or Tenant’s parent or ultimate parent;
(d) a transfer to any entity into which or with which Tenant, its
successors or assigns, is merged or consolidated, in accordance with applicable
statutory provisions of merger

 

20

 

or
consolidation of entities, so long as the liabilities of the entities
participating in such merger or consolidation are assumed by the entity
surviving such merger or created by such consolidation; or (e) a sale of
substantially all of the stock of Tenant; or (f) a sale of substantially
all of the assets of Tenant to a single entity that expressly assumes this
Lease; or (g) a similar intercompany transaction to those described in (a), (b)
or (c) above; or (h) a similar corporate transaction to those described in (d),
(e) and (f) above. With respect to each of the transactions described in items
(a), (b), (c) and (g) above of this Section, Tenant shall remain liable under
this Lease. With respect to each of the transactions described in items (d),
(e), (f) and (h) above of this Section, Tenant’s obligations under this Lease
shall terminate entirely and Tenant shall be released of any liability under
this Lease, except for any liabilities of Tenant which accrued prior to the
date of such transaction.

 

12.03       Subletting and Non-Disturbance. Subject
to Section 12.07 below, Tenant shall have the right to sublet any
portion of the Premises, without Landlord’s consent or approval, so long as
Tenant shall remain liable under this Lease and Tenant delivers notice thereof
to Landlord along with a copy of any such sublease. Upon the request of Tenant
from time to time, if (a) the terms of a sublease were negotiated on an
arm’s length basis with a third party not affiliated with Tenant; (b) the
base minimum rent per square foot of the portion of the Premises sublet for the
term of such sublease is equal to or greater than the amount as determined in
accordance with Exhibit B; (c) the terms of the sublease shall have
substantially the same terms and conditions as this Lease, including, without
limitation, the same lease term, rent escalations, covenants, escrows and
reserves and financial reporting requirements (except for such provisions which
by their terms are not applicable to such Premises sublet); (d)  the
tenant under the sublease at the time of the sublease (i) has an
investment rating of “BBB” or better from Standard and Poor’s (or an equivalent
rating or shadow rating from another nationally recognized statistical rating
service) or (ii) at the time of the proposed sublease, is a reputable,
creditworthy tenant; or (iii) at the time of the proposed sublease, has a
Tangible Net Worth of at least Fifteen Million Dollars ($15,000,000),
(provided, however, that Tenant may satisfy any one of the foregoing conditions
of tenant under the sublease set forth in (d)(i), (ii) or (iii) above by
providing, or causing to be provided, a guaranty (in form and substance
reasonably acceptable to and approved by Landlord in writing, such approval not
to be unreasonably withheld or delayed) from an entity that meets any of the
foregoing requirements), (e) the sublease contains no other material
provisions that (i) benefit the subtenant and are unusual for a “market”
sublease of the type in question and (ii) are materially adverse to a
landlord, and (f) Tenant provides Landlord with an officer’s certificate of
Tenant certifying compliance with the criteria in subsections (a)
through (e), and attaching a schedule of rent calculations and other details
supporting the certifications, in the form attached hereto as Schedule 12.03,
then Landlord shall execute and deliver to such subtenant a written agreement
substantially in the form attached hereto as Exhibit D (an “NDA”),
to the effect that, notwithstanding the termination of this Lease or Tenant’s
possessory and other rights and obligations under this Lease by Landlord, so
long as such subtenant shall continue to observe and perform all of its
obligations under a sublease, such subtenant and the rights of subtenant under
any sublease shall not be disturbed by Landlord but shall continue in full
force and effect, Landlord shall assume the obligations of the landlord under
the sublease and the provisions of Section 16.01(j) or any other
Default under this Lease shall not apply to any such sublease. For avoidance of
doubt, the payment by Tenant to a subtenant of a tenant allowance at the
execution of the sublease shall not be considered unusual. In the event of a
termination of this Lease, any sublease for which a NDA has been executed and

 

21

 

delivered by
Landlord shall continue in full force and effect as a direct lease between
Landlord and subtenant. Landlord agrees to execute, and to use commercially
reasonable efforts to cause its Mortgagee to execute, such documentation as may
be reasonably required to effectuate the non-disturbance contemplated herein,
including, without limitation, estoppel letters, recognition agreements and a
non-disturbance agreement, substantially in the form attached hereto as Exhibit
D.

 

12.04       Assignment by Landlord. As a material
inducement to Landlord’s willingness to complete the transactions contemplated
by this Lease (the “Transaction”), Tenant hereby agrees that Landlord
may, from time to time and at any time and without the consent of Tenant,
engage in all or any combination of the following, or enter into agreements in
connection with any of the following or in accordance with requirements that
may be imposed by applicable securities, tax or other Laws: (a) the sale,
assignment, grant, conveyance, transfer, financing, re-financing, purchase or
re-acquisition in whole, but not part, of the Premises or this Lease, Landlord’s
right, title and interest in this Lease, the servicing rights with respect to
any of the foregoing, or participations in any of the foregoing, provided,
however, in no event may Landlord disclose or permit the disclosure of the
financial information described in Section 31.17(g) (except as otherwise
provided therein) to any potential purchaser, assignee, transferee or lender
that owns or can direct the management, directly or indirectly, of five (5) or
more commonly managed retail locations; or (b) a Securitization (defined
in Section 31.22 below) and related transactions. Without in any way
limiting the foregoing, the parties acknowledge and agree that Landlord, in its
sole discretion, may assign this Lease or any interest herein to another Person
(including without limitation, a taxable REIT subsidiary) in order to maintain
Landlord’s or any of its affiliates’ status as a REIT. In the event of any such
sale or assignment other than a security assignment, Tenant shall attorn to
such purchaser or assignee (so long as Landlord and such purchaser or assignee
notify Tenant in writing of such transfer and such purchaser or assignee
expressly assumes in writing the obligations of Landlord hereunder). At the
request of Landlord, Tenant will execute such documents confirming the sale,
assignment or other transfer and such other agreements as Landlord may
reasonably request, provided that the same do not increase the liabilities and
obligations, or decrease the rights, of Tenant hereunder in any manner
whatsoever, and Landlord shall reimburse the reasonable costs and expenses
incurred by Tenant related to the execution and delivery of such documents, provided
that such costs and expenses are in excess of the costs and expenses Tenant may
incur in connection with the performance of its obligations under this Lease. Landlord
shall be relieved, from and after the date of such transfer or conveyance, of
liability for the performance of any obligation of Landlord contained herein,
except for any obligations or liabilities accrued prior to the date of such
assignment or sale.

 

12.05       Substitution. Subject to Section
12.07 below, Tenant shall have the right to substitute like-kind assets for
the Property Locations; provided, however, that (1) Tenant shall not have any
such substitution right if the substitution of any Property Location would
cause Landlord to recognize income or gain from a “prohibited transaction” as
defined under Section 857(b)(6) of the Internal Revenue Code of 1986,
as the same may be amended from time to time (the “Code”) or such
substituted like-kind asset is not “real property” under Section 856 of the
Code, and (2) Landlord may irrevocably elect to retain the Property Locations
that Tenant requests for substitution. If Tenant elects to conduct a
substitution such that another

 

22

 

unencumbered
property location or locations (the “Substitute Property”) is
substituted for a Property Location being released:

 

(a)           Tenant shall
reimburse Landlord for substitution fees, costs and expenses (including without
limitation, fees and expenses related to legal opinions) charged by Landlord’s
Mortgagee and other out-of-pocket fees and costs reasonably and actually
incurred by Landlord in connection with such substitution;

 

(b)           Subject to the
requirements set forth in this Section 12.05, Landlord covenants
that it shall provide Tenant with such cooperation as Tenant may reasonably
request to qualify any exercise by Tenant of a substitution right under this Section
12.05 as a transaction qualifying under Section 1031 of the Code;,
provided, however, that (i) Landlord shall not be obligated to pay, suffer
or incur any additional expenses or liabilities as a result of cooperating in
Tenant’s exchange and Landlord shall not be obligated to acquire any other real
property in connection with Tenant’s exchange; (ii) Landlord shall not
have any liability to Tenant for failure of the exchange to qualify under the
Code; (iii) except as otherwise expressly provided in this Lease, any
assignment(s) made by Tenant in connection with such exchange shall not relieve
Tenant of its obligations under this Lease; and (iv) the completion of one
or more tax-deferred exchanges is not a condition to the performance by
Tenant of the obligations of Tenant set forth in this Lease; and

 

(c)           The substitution
shall comply with the substitution requirements, if any, of Landlord’s
Mortgagee related to substitution, as well as the following:

 

(i)            the Substitute
Property shall be made subject to this Lease with no decline in Base Rent or
any other Rent due hereunder;

 

(ii)           the appraised value
of the Substitute Property shall be equal to or greater than the appraised
value of the Property Location being released (each such appraisal having been
prepared within one hundred eighty (180) days prior to the release and
substitution date);

 

(iii)          the Substitute
Property shall have a store level profitability equal to or greater than the
store level profitability of the Property Location being released;

 

(iv)          to the extent
required by its Mortgagee, Landlord shall have obtained (A) the written consent
of its Mortgagee to such substitution, and (B) confirmation from each
statistical rating agency that has assigned a rating to securities sold in any
Securitization in which any loan related to a Mortgage has been included that
such Substitute Property shall not result in the downgrade, withdrawal or
qualification of any securities backed by such respective loan;

 

(v)           no Default under
this Lease has occurred and is continuing;

 

(vi)          the Property
Location being substituted shall be released from this Lease;

 

23

 

(vii)         with respect to the
Substitute Property, Landlord and its Mortgagee shall have received an
engineering report and an environmental report, dated not more than one hundred
eighty (180) days prior to the proposed date of substitution, acceptable to
Landlord and its Mortgagee; and

 

(viii)        Landlord shall have
received an officer’s certificate of Tenant certifying that the square footage
of the Substitute Property complies with the provisions in Section 12.07
hereof, along with square footage calculations in support thereof.

 

12.06       Concessionaires. Notwithstanding
anything herein to the contrary, Tenant shall have the right, without Landlord’s
consent or approval, to sublease or license up to ten percent (10%) of the
rentable square footage of each Property Location to concessionaires consistent
with Tenant’s typical store operations, including without limitation, the
existing license agreement between Tenant and Payless dated July 23, 1999, as
amended; provided that (a) the term of such sublease or license shall not
extend beyond the period that ends one day before the expiration of the Term;
and (b) Tenant (i) gives Landlord written notice thereof,
(ii) makes commercially reasonable efforts to provide to Landlord copies
of any such subleases or licenses (provided that the failure to deliver the
same shall not constitute a default by Tenant under this Lease), and
(iii) provides Landlord with an officer’s certificate of Tenant certifying
that the foregoing square footage restrictions have not been breached, along
with a schedule of square footage calculations in support thereof attached
thereto. Any sublease (excluding the sublease related to Store No. 3852 in
Bethany, Missouri) or licenses to concessionaires shall not count towards the
limits against subletting set forth in Section 12.07 below.

 

12.07       Limits on Assignment, Subletting and Substitution.
Notwithstanding anything to the contrary contained in this Lease and without in
any way eliminating or diminishing Tenant’s obligation to comply with all Legal
Requirements or its obligations hereunder, (a) the maximum amount of
rentable square footage in this Lease that can be assigned, sublet or
substituted in any one (1) year is limited to twenty percent (20%) of the
aggregate rentable square footage of the Buildings and the maximum amount of
rentable square footage in this Lease that can be assigned, sublet or
substituted over the Term is limited to thirty percent (30%) of the aggregate
rentable square footage of the Buildings; provided, however that the limits set
forth in this Section 12.07 shall not apply to subleases or assignments
with respect to (i) any Property Locations for which the Tenant is permitted to
“go dark” pursuant to Section 4.01, or (ii) any concessionaire as
described in Section 12.06, or (iii) except with respect to Store No.
3852 in Bethany, Missouri, any subleases existing as of the Effective Date; and
(b) any attempted assignment, subletting or substitution in violation of
this Section 12.07 shall be deemed null and void, and of no force
or effect. Furthermore, Tenant shall not have the right to assign or sublet all
or any portion of the Buildings unless Tenant shall have provided to Landlord,
immediately prior to the effective date of such assignment or sublease, an
officer’s certificate (the “Assignment or Sublease Officer’s Certificate”)
signed by an officer of the assignee or sublessee certifying that none of the
parties identified by Landlord as a ten percent (10%) shareholder of Landlord
(on a written list certified by Landlord and to be provided to Tenant following
the request of Tenant in connection with any proposed assignment or sublease)
owns, directly or, to the assignee’s or sublessee’s actual knowledge after such
assignee or sublessee has made inquiry of its officer or similar person that is
responsible for maintaining records regarding the direct ownership of such
assignee or sublessee, indirectly, (1) ten percent

 

24

 

(10%) or more
of the total combined voting power of all classes of voting capital stock of
the assignee or sublessee, as the case may be, or (2) ten percent (10%) or more
of the total value of all classes of capital stock of the assignee or
sublessee, as the case may be. Landlord shall provide the written list
described in the preceding sentence within five (5) business days of written
request therefore by Tenant and, in the absence of timely provision of such
list, such officer’s certificate shall be based on the latest written list
delivered by Landlord to Tenant.

 

ARTICLE 13.

WAIVER OF CERTAIN CLAIMS; INDEMNITY BY TENANT

 

13.01       Waiver of Certain Claims. Except as
otherwise required under applicable law or to the extent of Landlord’s willful
wrongful acts or gross negligence (provided that the term “gross negligence”
used throughout this Article 13 shall not include gross negligence
imputed as a matter of law to any of the Landlord Indemnified Parties solely by
reason of Landlord’s interest in any Property Location or Tenant’s failure to
act in respect of matters which are or were the obligation of Tenant under this
Lease), but in all events, subject to the waiver of claims and subrogation set
forth in this Lease, the Landlord Indemnified Parties shall not in any event
whatsoever (a) be liable for any injury or damage to Tenant or any third
party happening in, on or about the Premises, nor for any injury or damage to
the Premises or to any property belonging to Tenant (including Tenant’s
Personalty) or any third party which may be caused by any fire, breakage or
other Casualty Event, or by any other cause whatsoever or by the use, misuse or
abuse of any of the Buildings or any other improvements at a Property Location
or which may arise from any other cause whatsoever; nor (b) be liable to
Tenant or any third party for any failure of water supply, gas, telephone or
electric current, nor for any injury or damage to any property of Tenant
(including Tenant’s Personalty) or to the Premises caused by or resulting from
gasoline, oil, steam, gas or electricity or hurricane, tornado, flood, wind or
similar storms or disturbances, or water, rain, sleet, ice or snow which may
leak or flow from the street, sewer, gas mains or subsurface area or from any
part of the Premises, or leakage of gasoline or oil from pipes, storage tanks,
appliances, sewers or plumbing works therein, or from any other place or from
any other cause, nor for interference with light or other incorporeal
hereditaments by anybody, or caused by any public or quasi-public work.

 

13.02       Tenant Responsible for Personal Property.
All Tenant’s Personalty and other personal property belonging to any occupant
of any Property Location that is in the applicable Building or the remainder of
such Property Location shall be there at the risk of Tenant or other Person
only, and Landlord shall not be liable for damage thereto or theft or
misappropriation thereof.

 

13.03       Indemnification.

 

(a)           Tenant agrees to use
and occupy the Premises at its own risk and hereby releases the Landlord
Indemnified Parties from all claims for any damage or injury to the full extent
permitted by law. Except to the extent of Landlord’s willful wrongful acts or
gross negligence and without in any way limiting Tenant’s other indemnification
obligations under this Lease (including without limitation, those set forth in Sections
9.04, 11.01(e), 25.08  and 32.01),
Tenant shall (promptly as incurred or upon demand by any Landlord Indemnified
Party) indemnify, save, protect, defend and hold harmless Landlord and any
agent, beneficiary,

 

25

 

representative,
contractor, manager, member, director, employee, Mortgagee, officer, director,
parent, partner, shareholder, trustee, affiliate, subsidiary, participant,
successors and assigns of Landlord (collectively, with Landlord, the “Landlord
Indemnified Parties”, and each, a “Landlord Indemnified Party”) from
and against any and all liabilities, suits, obligations, fines, damages,
penalties, claims, costs, charges and expenses, including, without limitation,
reasonable engineers’, architects’ and attorneys’ fees, court costs and
disbursements, which may be imposed upon or incurred by any Landlord
Indemnified Party during or after (but attributable to a period of time falling
within) the Term caused by, incurred or resulting from Tenant’s operations or
by Tenant’s use and occupancy of the Premises, whether relating to its original
design or construction, latent defects, alteration, maintenance, use by Tenant
or any Person thereon.

 

(b)           Landlord shall
indemnify, save, protect, defend and hold harmless Tenant and any agent,
beneficiary, representative, contractor, manager, member, director, employee,
Leasehold Mortgagee, officer, director, parent, partner, shareholder, trustee,
affiliate, subsidiary, participant, successors and assigns of Tenant
(collectively the “Tenant Indemnified Parties” and each, a “Tenant
Indemnified Party”; the Tenant Indemnified Party and the Landlord
Indemnified Party shall be collectively called the “Indemnified Party”)
harmless from and against any and all liabilities, suits, obligations, fines,
damages, penalties, claims, costs, charges and expenses, including, without
limitation, reasonable engineers’, architects’ and attorneys’ fees, court costs
and disbursements, which may be imposed upon or incurred by or asserted against
any Tenant Indemnified Party by reason of any willful wrongful act or gross
negligence by Landlord pursuant to or in connection with this Lease or Landlord’s
repossession of the Premises.

 

(c)           The obligations of
Tenant and Landlord under this Article 13 shall not be affected in
any way by the absence in any case of covering insurance or by the failure or
refusal of any insurance carrier to perform any obligation on its part under
insurance policies affecting the Premises or any part thereof.

 

(d)           If any claim, action
or proceeding is made or brought against any Indemnified Party against which it
is indemnified pursuant to this Section 13.03, then, upon demand by
any Indemnified Party, the other party shall resist or defend such claim, action
or proceedings in the Indemnified Party’s name, if necessary, by the attorneys
for the insurance carrier (if such claim, action or proceeding is covered by
insurance), otherwise by such attorneys as the Indemnified Party shall approve,
which approval shall not be unreasonably withheld or delayed.

 

(e)           The provisions of
this Section 13.03 shall survive for a period of five (5) years
after the Expiration Date or earlier termination of this Lease.

 

ARTICLE 14.

USE OF CASUALTY INSURANCE PROCEEDS

 

14.01       Tenant’s Obligation to Restore. If all
or any part of the improvements on any Property Location shall be destroyed or
damaged in whole or in part by fire or other casualty (whether or not insured)
of any kind or nature, ordinary or extraordinary, foreseen or unforeseen (a “Casualty
Event”), Tenant shall give Landlord prompt written notice thereof, and
Tenant, with

 

26

 

reasonable
diligence (subject to Force Majeure and Section 14.03 below), shall
repair, alter, restore, replace and rebuild (collectively, “Restore” or “Restoration”)
the same, as nearly as practicable to the character of the improvements on such
Property Location existing immediately prior to such Casualty Event, and in no
event shall Landlord be called upon to Restore the improvements on such
Property Location, as now or hereafter existing, or any portion thereof or to
pay any of the costs or expenses thereof. If Tenant is required to but shall
fail or neglect to Restore with reasonable diligence (subject to Force Majeure
and Section 14.03 below) the improvements on such Property Location or
the portion thereof damaged or destroyed, or, having so commenced such
Restoration, shall fail to complete the same with reasonable diligence (subject
to Force Majeure) in accordance with the terms of this Lease, Landlord may (but
shall not be obligated to), after thirty (30) days’ prior written notice to
Tenant and Tenant’s failure to commence or re-commence such Restoration,
complete such Restoration at Tenant’s expense, the costs for which Tenant shall
be obligated to reimburse Landlord and until paid shall accrue Default
Interest.

 

In the event the insurance proceeds after deduction of any reasonable
costs and expenses, if any, incurred by Tenant, Landlord or a Mortgagee in
collecting the same (collectively, “Net Insurance Proceeds”) of any
Casualty Event are less than Three Hundred Seventy-Five Thousand Dollars
($375,000.00), increased annually
based on increases in the CPI (the “Restoration Threshold”), Landlord
shall disburse, or cause to be disbursed, to Tenant such Net Insurance
Proceeds. In the event the Net Insurance Proceeds are greater than the
Restoration Threshold, Landlord shall use commercially reasonable efforts to
disburse or cause Mortgagee to disburse such Net Insurance Proceeds within ten
(10) days upon Landlord being furnished with (a) evidence reasonably
satisfactory to Landlord of the estimated cost of completion of the
Restoration, (b) such architect’s certificates, waivers of lien, contractor’s
sworn statements, mortgagee’s title insurance endorsements, bonds, plats of
survey, permits, approvals, licenses and such other documents and items as
Landlord may reasonably require and approve in Landlord’s reasonable
discretion, and (c) all plans and specifications for such Restoration, such
plans and specifications to be approved by Landlord prior to commencement of
any work, which approval shall not be unreasonably withheld, conditioned or
delayed; provided, that, in any event, Landlord shall use commercially
reasonable efforts to diligently provide or cause Mortgagee to diligently
provide its written approval or disapproval 
(with reasons of sufficient specificity to allow Tenant to correct the
reasonable objection) following Landlord’s receipt of such plans and
specifications. Landlord may, at Tenant’s reasonable expense, retain a
consultant to review and approve all requests for disbursements, which approval
shall also be a condition precedent to any disbursement, which approval shall
not be unreasonably withheld, conditioned or delayed; provided, that, in any
event, Landlord shall use commercially reasonable efforts to cause the
consultant to diligently provide its written approval or disapproval  (with reasons of sufficient specificity to
allow Tenant to correct the reasonable objection) following such consultant’s
and/or Landlord’s receipt of Tenant’s request for disbursement. No payment made
prior to the final completion of the Restoration shall exceed ninety percent
(90%) of the value of the work performed; funds other than the Net Insurance
Proceeds shall be disbursed prior to disbursement of such Net Insurance
Proceeds; and at all times, the undisbursed balance of such Net Insurance
Proceeds then held by Landlord, together with funds deposited for that purpose
or irrevocably committed to the reasonable satisfaction of Landlord by or on
behalf of Tenant for that purpose, shall be at least sufficient in the
reasonable judgment of Landlord to pay for the cost of completion of the
Restoration, free and clear of all liens or claims for a lien. Prior to the

 

27

 

disbursement of any portion of the Net Insurance Proceeds, Tenant shall
provide evidence reasonably satisfactory to Landlord of the payment of Restoration
expenses by Tenant up to the amount of the insurance deductible applicable to
such Casualty Event. Landlord shall be entitled to keep any portion of the Net
Insurance Proceeds which may be in excess of the cost of Restoration, and
Tenant shall bear all additional costs and expense of such Restoration in
excess of the Net Insurance Proceeds. Notwithstanding anything in this Section
14.01 to the contrary, if, at the time of a Casualty Event, Tenant fails to
meet an EBITDAR Ratio (as defined in Section 30.06(c)) of 1.15 to 1
calculated on a trailing twelve (12) month basis at the time of such test, then
Landlord shall have the right after the Casualty Event to withhold the
applicable insurance proceeds for the Restoration if, at Mortgagee’s election,
Mortgagee desires to apply the insurance proceeds relating to such Casualty
Event to the payment of Landlord’s Mortgage (a “Casualty Withholding Event”).
Promptly upon Landlord’s receipt of notice from Mortgagee of a Casualty
Withholding Event (provided that Landlord shall use commercially reasonable
efforts to cause Mortgagee to notify it as soon as possible of a decision),
Landlord shall provide written notice thereof to Tenant.

 

14.02       No Abatement of Rent. Except as
otherwise provided in Sections 14.03 and 14.04 below, this Lease shall
not terminate, be forfeited or be affected in any manner, nor shall there be
any reduction or abatement of the Rent payable hereunder, by reason of damage
to or total, substantial or partial destruction of any Building or any part
thereof or the improvements on any Property Location or any part thereof, or by
reason of the untenantability of the same or any part thereof, for or due to
any reason or cause whatsoever, and Tenant, notwithstanding any law or statute
present or future, waives any and all rights to quit or surrender any Property
Location or any part thereof; and Tenant’s obligations hereunder, including
without limitation, the payment of Rent hereunder, shall continue as though the
improvements on such Property Location had not been damaged or destroyed and
without abatement, suspension, diminution or reduction of any kind.

 

14.03       Right to Terminate. Notwithstanding any
other provision to the contrary contained in this Article 14, in the
event that, as a result of such a Casualty Event, (a) Tenant shall reasonably
estimate in the exercise of good faith business judgment that (i) the
applicable Property Location cannot be used for the same purpose and
substantially with the same utility as before such Casualty Event, or (ii) it
will be unable to use such damaged Property Location for the customary
operation of Tenant’s business for more than (1) one (1) year, or (2) one
hundred twenty (120) days if such Casualty Event has occurred in the last two
(2) years of the Term or any extension of the Term, or (b) Landlord elects not
to provide the insurance proceeds from any Casualty Event to Tenant in
accordance with a Casualty Withholding Event under Section 14.01, then,
subject to the terms and conditions hereinafter set forth, Tenant shall have
the right, exercisable by written notice given to Landlord no later than thirty
(30) days following such Casualty Event, to cause Landlord to modify this Lease
to remove the damaged Property Location (and reduce the Rent pursuant to the
terms of Section 14.04 below) and, following such removal, Tenant shall
have no further responsibility to Landlord with respect to such damaged
Property Location, except for such indemnity or other provisions of this Lease
which may relate to such damaged Property Location. Such modification shall not
be effective, and Tenant’s obligation to pay Rent hereunder shall continue,
until and unless (A) Tenant has complied with all obligations pursuant to Article
6 hereof, (B) Tenant has paid to Landlord all Rent and other amounts
payable with respect to the damaged Property Location through the date of the
Casualty

 

28

 

Event, and (C)
Tenant has paid or has caused to be paid to Landlord as its interests may
appear all insurance deductibles, and all insurance proceeds which shall have
been paid to Tenant with respect to the destruction or damage of such Property
Location and not utilized towards the Restoration; provided, however, that Tenant shall
retain those insurance proceeds in which Landlord does not have an interest
including, but not limited to, Tenant’s Personalty, and ordinary payroll
insurance proceeds.

 

14.04       Reduction of Rent. Upon removal of a
Property Location pursuant to Section 14.03 above, the Base Rent shall
be reduced by the amount as determined in accordance with Exhibit B.

 

ARTICLE 15.

EMINENT DOMAIN

 

15.01       Taking: Lease to Terminate. If a
substantial portion of a Building or a Parcel shall be lawfully taken as a
result of the exercise of the power of eminent domain or condemned for a public
or quasi-public use or purpose by any competent authority or sold to the
condemning authority under threat of condemnation (collectively, a “Condemnation”),
and (a) Tenant reasonably estimates in the exercise of good faith business
judgment that, as a result thereof, the applicable Property Location cannot be
used for the same purpose and substantially with the same utility as before
such taking or conveyance or (b) Landlord elects not to provide the Condemnation
proceeds from any Condemnation to Tenant in accordance with a Condemnation
Withholding Event under Section 15.02 below, Tenant shall have the right
to cause Landlord to modify this Lease to remove the taken Property Location,
whereupon such removal of a Property Location the Base Rent shall be reduced by
the amount as determined in accordance with Exhibit B. If this Lease is
so modified pursuant to this Section 15.01, then, upon the date of such
taking of possession, Tenant shall have no further responsibility to Landlord
with respect to such Property Location except for such indemnity or other
provisions of this Lease which by their nature may relate to such Property
Location. Landlord shall be entitled to receive the entire Condemnation award
relating to the land and improvements with respect to such taking.

 

15.02       Taking: Lease to Continue. In the event
that only a part of a Property Location shall be taken as a result of a
Condemnation, and Tenant reasonably estimates in the exercise of good faith
business judgment that, as a result thereof, the remainder of such Property
Location can be used for the same purpose and with substantially the same
utility as before such Condemnation, this Lease shall not be modified and
Tenant shall promptly repair and restore the remainder of such Property
Location, subject to Force Majeure. In the event the proceeds of the
Condemnation after deduction of any reasonable costs and expenses, if any,
incurred by Tenant, Landlord or a Mortgagee in collecting the same (collectively,
“Net Condemnation Proceeds”) are less than the Restoration Threshold,
Landlord shall disburse, or cause to be disbursed, the Net Condemnation
Proceeds to Tenant. In the event the Net Condemnation Proceeds are greater than
the Restoration Threshold, Landlord shall use commercially reasonable efforts
to disburse and/or cause Mortgagee to expeditiously disburse such Net
Condemnation Proceeds upon Landlord being furnished with (a) evidence
satisfactory to Landlord of the estimated cost of completion of the repair or
restoration, (b) such architect’s certificates, waivers of lien, contractor’s
sworn statements, mortgagee’s title insurance endorsements, bonds, plats of
survey, permits, approvals, licenses and such other documents and items as
Landlord may reasonably require and approve in

 

29

 

Landlord’s
reasonable discretion, and (c) all plans and specifications for such repair or
restoration, such plans and specifications to be approved by Landlord prior to
commencement of any work, which approval shall not be unreasonably withheld,
conditioned or delayed; provided, that, in any event, Landlord shall use
commercially reasonable efforts to diligently provide or cause Mortgagee to
diligently provide its written approval or disapproval  (with reasons of sufficient specificity to
allow Tenant to correct the reasonable objection) following Landlord’s receipt
of such plans and specifications. Landlord may, at Tenant’s reasonable expense,
retain a consultant to review and approve all requests for disbursements, which
approval shall not be unreasonably withheld, conditioned or delayed; provided,
that, in any event, Landlord shall use commercially reasonable efforts to cause
the consultant to diligently provide its written approval or disapproval  (with reasons of sufficient specificity to
allow Tenant to correct the reasonable objection) following such consultant’s
and/or Landlord’s receipt of Tenant’s request for disbursement. No payment made
prior to the final completion of the repair or restoration shall exceed ninety
percent (90%) of the value of the work performed; funds other than the Net
Condemnation Proceeds shall be disbursed prior to disbursement of such Net
Condemnation Proceeds; and at all times, the undisbursed balance of such Net
Condemnation Proceeds then held by Landlord, together with funds deposited for
that purpose or irrevocably committed to the reasonable satisfaction of
Landlord by or on behalf of Tenant for that purpose, shall be at least
sufficient in the reasonable judgment of Landlord to pay for the cost of
completion of the repair or restoration, free and clear of all liens or claims
for a lien. Landlord shall be entitled to keep any portion of the net proceeds
from Condemnation which may be in excess of the cost of the repair or
restoration, and Tenant shall bear all additional costs and expense of such
repair or restoration in excess of the net proceeds from Condemnation. Notwithstanding
anything in this Section 15.02 to the contrary, if, at the time of a
Condemnation, Tenant fails to meet an EBITDAR Ratio of 1.15 to 1 calculated on
a trailing twelve (12) month basis at the time of such test, then Landlord
shall have the right after the Condemnation to withhold the Net Condemnation
Proceeds for the restoration and repair if, at Mortgagee’s election, Mortgagee
desires to apply the Net Condemnation Proceeds relating to such Condemnation to
the payment of Landlord’s Mortgage (a “Condemnation Withholding Event”).
Promptly upon Landlord’s receipt of notice from Mortgagee of a Condemnation
Withholding Event (but not later than thirty (30) days after the Condemnation),
Landlord shall provide written notice thereof to Tenant.

 

15.03       No Abatement of Rent. Except as
otherwise provided in Section 15.01, this Lease shall not terminate, be
forfeited or be affected in any manner, nor shall there be any reduction or
abatement of the Rent payable hereunder, by reason of any Condemnation of any
Property Location or any part thereof, or by reason of the untenantability of
the same or any part thereof, for or due to any reason or cause whatsoever.

 

15.04       Tenant’s Claim for Reimbursement. Notwithstanding
anything to the contrary in this Article 15, to the extent permitted by
law, (a) Tenant shall be allowed, at its sole cost and expense, to pursue
a claim against the condemning authority that shall be independent of and
wholly separate from any action, suit or proceeding relating to any award to
Landlord for reimbursement of Tenant’s leasehold interest, relocation expenses
or for Tenant’s Personalty; and (b) Tenant and any Tenant Mortgagee shall
have the right to participate, at their sole cost and expense, in any
Condemnation proceeding affecting a Property Location or any Buildings thereon;
provided that such claim, award or participation does not adversely affect or
interfere

 

30

 

with the
prosecution of Landlord’s claim for the Condemnation or otherwise reduce the
amount recoverable by Landlord for the Condemnation.

 

ARTICLE 16.

DEFAULT

 

16.01       Events of Default. The occurrence of
any one or more of the following matters constitutes a default (each, a “Default”)
by Tenant under this Lease:

 

(a)           Failure by Tenant to
pay any Rent within two (2) business days after written notice of failure to
pay the same on the due date; provided, however, that Landlord shall only be
obligated to provide such written notice and the two (2) business day cure
period shall only be available twice every twelve (12) month period;

 

(b)           Failure by Tenant to
pay, within 5 (five) business days after written notice of (i) demand by
Landlord therefor to the extent such monies are due and payable, or
(ii) Tenant’s failure to pay the same on the due date, of any other monies
required to be paid by Tenant under this Lease, including without limitation,
the failure by Tenant to pay, prior to delinquency, any Impositions, the
failure of which to pay could result in the imposition of a lien against any
Property Location;

 

(c)           Failure by Tenant to
observe or to perform any other material covenant, agreement, condition or
provision of this Lease, if such failure continues for thirty (30) days after
written notice thereof from Landlord to Tenant or such longer time as may be
reasonably required to cure because of the nature of the default (provided
Tenant shall have undertaken procedures to cure the default within such thirty
(30) day period and thereafter diligently pursue such effort to completion)
provided, however, that the foregoing notice obligation and cure period shall
not be applicable where Tenant’s failure to observe or to perform any other
material covenant agreement, condition or provision of this Lease relates to
(i) Tenant’s payment of Rent or any other monetary obligation hereunder, or
(ii) a condition that would place the Premises in immediate physical jeopardy
or in immediate jeopardy of being forfeited or lost;

 

(d)           Intentionally
deleted;

 

(e)           The levy upon, under
writ of execution or the attachment by legal process of, the leasehold interest
of Tenant or any Property Location, or the filing or creation of a lien with
respect to such leasehold interest or any Property Location, which lien shall
not be released or discharged within ninety (90) days from the date of Landlord’s
written request to release or discharge such filing;

 

(f)            The insolvency of
Tenant or Tenant’s admission in writing of its inability to pay its debts as
they mature, or Tenant’s making an assignment for the benefit of creditors, or
applying for or consenting to the appointment of a trustee or receiver for
Tenant or for the major part of its property;

 

(g)           The appointment of a
trustee or receiver for Tenant or for the major part of its property which is
not discharged within one hundred fifty (150) days after such appointment;

 

31

 

(h)           The institution of
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings for relief under any bankruptcy law, or
similar law for the relief of debtors (i) by Tenant or (ii) against Tenant and
which are allowed against it or are consented to by it or are not dismissed
within one hundred fifty (150) days after such institution;

 

(i)            A final,
nonappealable judgment is rendered by a court against Tenant which would render
Tenant insolvent and is not discharged or provision made for such discharge by
the earlier of (i) one hundred twenty (120) days from the date of entry
thereof, or (ii) execution or levy thereon;

 

(j)            A monetary “Default”
or monetary event of default by the tenant under the lease dated of even date
herewith listed on Schedule 16.01(j) attached hereto (the “Other
Lease”) that is not cured within the applicable notice and grace periods
set forth in the Other Lease; provided however, this Section 16.01(j)
shall be terminated and null and void and shall no longer apply as a potential
Default under this Lease if (i) the EBITDAR Ratio calculated on a trailing
twelve (12) month basis at the time of such test, is at least 1.50 to 1 for
Pamida Stores Operating Co., LLC and 1.30 to 1 for ShopKo Stores Operating Co.,
LLC, each on a stand alone basis, and (ii) the EBITDAR Ratio of the
consolidated combined Pamida and ShopKo entities calculated on a trailing
twelve (12) month basis at the time of such test is at least 1.50 to 1
(collectively, the “Cross Default Termination Tests”). Tenant shall have
the right to perform the Cross Default Termination Tests at any time and upon
satisfaction of the Cross Default Termination Tests, Landlord shall confirm in
writing that such tests have been satisfied and this Section 16.01(j)
shall be terminated and null and void and no longer a potential Default under
this Lease;

 

(k)           Intentionally
Deleted; or

 

(l)            The failure by
Tenant to observe or to perform any obligation set forth in Section 31.17
after the expiration of any applicable cure periods set forth in such Section.

 

16.02       Rights and Remedies of Landlord. If a
Default occurs, Landlord shall have the rights and remedies hereinafter set
forth, which shall be distinct, separate and cumulative and which shall not
operate to exclude or deprive Landlord of any other right or remedy allowed it
by law or equity:

 

(a)           Landlord, upon ten
(10) days additional prior notice to Tenant (during which time Tenant may cure
the Default) with respect to any Default set forth in Sections 16.01(b)
through (k) (expressly excluding Sections 16.01(a) and (l) for which
no additional notice shall be required), may terminate this Lease with respect
to each and every Property Location by giving to Tenant notice of Landlord’s
election to do so, in which event the Term shall end, and all rights, title and
interest of Tenant hereunder shall expire, on the date stated in such notice;
provided, however, that Landlord shall only be obligated to provide such additional
written notice and the ten (10) day cure period shall be available only twice
every twelve (12) months;

 

(b)           Landlord, upon ten
(10) days additional prior notice to Tenant (during which time Tenant may cure
the Default) with respect to any Default set forth in Sections

 

32

 

16.01(b)
through (k) (expressly excluding Sections 16.01(a)
and (l) for which no additional notice shall be required), may terminate
the right of Tenant to possession with respect to each and every Property
Location without terminating this Lease by giving notice to Tenant that Tenant’s
right of possession shall end on the date stated in such notice, whereupon the
right of Tenant to possession of the applicable Property Location or any part
thereof shall cease on the date stated in such notice; provided, however that
Landlord shall only be obligated to provide such additional written notice and
the ten (10) day cure period shall be available only twice every twelve (12)
months;

 

(c)           Landlord may, to the
extent not prohibited by applicable Laws and subject to Section 31.13,
(i) re-enter and take possession of the Premises (or any part thereof), any or
all of Tenant’s Personalty upon the Premises and, to the extent permissible,
all permits and other rights or privileges of Tenant pertaining to the general
use and operation of the Premises, but excluding any permits or other rights
and privileges that are specific to the use and operation of Tenant’s business
upon the Premises, and (ii) expel Tenant and those claiming under or through
Tenant, without being deemed guilty in any manner of trespass or becoming
liable for any loss or damage resulting therefrom, without resort to legal or
judicial process, procedure or action. No notice from Landlord hereunder or
under a forcible entry and detainer statute or similar law shall constitute an
election by Landlord to terminate this Lease unless such notice specifically so
states. If Tenant shall, after default, voluntarily give up possession of the
Premises to Landlord, deliver to Landlord or its agents the keys to the
Premises, or both, such actions shall be deemed to be in compliance with
Landlord’s rights and the acceptance thereof by Landlord or its agents, and
shall not be deemed to constitute a termination of this Lease. Landlord
reserves the right following any re-entry and/or reletting to exercise its
right to terminate this Lease by giving Tenant written notice thereof, in which
event this Lease will terminate;

 

(d)           Except for a Default
pursuant to Section 16.01(l), Landlord may bring an action against
Tenant for any damages sustained by Landlord or any equitable relief available
to Landlord in connection with enforcing its rights under this Article 16;

 

(e)           Landlord may relet
the Premises or any part thereof for such term or terms (including a term which
extends beyond the original Lease Term), at such rentals and upon such other
terms as Landlord, in its reasonable discretion, may determine, with all
proceeds received from such reletting being applied to the Rent due from Tenant
in such order as Landlord may, in it sole discretion, determine, which may
include, without limitation, all repossession costs, brokerage commissions,
attorneys’ fees and expenses, alteration, remodeling and repair costs and
expenses of preparing for such reletting, all of which costs shall be
reasonable and customary. Landlord reserves the right following any re-entry
and/or reletting to exercise its right to terminate this Lease by giving Tenant
written notice thereof, in which event this Lease will terminate as specified
in said notice. Landlord agrees to use commercially reasonable efforts to
mitigate any damages resulting from a Default of Tenant; provided, however,
that Landlord’s obligation to so mitigate shall be satisfied in full and deemed
reasonable if Landlord undertakes to lease each Property Location to another
tenant (a “Replacement Tenant”) in accordance with the following
criteria:

 

(i)            Landlord shall not
be obligated to lease a Property Location to a Replacement Tenant under terms
or conditions that are unacceptable to Landlord under

 

33

 

Landlord’s
then current leasing policies for comparable space in the same market area as
the applicable Property Location, if any;

 

(ii)           Landlord shall not
be obligated to enter into a lease with any proposed Replacement Tenant which
does not have, in Landlord’s reasonable opinion, sufficient financial resources
or operating experience to operate the Premises; and

 

(iii)          Landlord shall not
be required to expend any amount of money to alter, remodel or otherwise make
the Premises suitable for use by a proposed substitute Tenant unless: (1)
Tenant pays any such sum to Landlord in advance of Landlord’s execution of a
substitute lease with such tenant (which payment shall not be in lieu of Rent
or any damages or other sums to which Landlord may be entitled as a result of
Tenant’s Default under this Lease); and (2) Landlord, in Landlord’s sole
discretion, determines that any such expenditure is financially justified in
connection with entering into any such substitute lease.

 

(f)            Except for a
Default pursuant to Section 16.01(l), Landlord may recover from Tenant
all reasonable actual out-of-pocket costs and expenses paid or incurred by
Landlord as a result of such Default, regardless of whether or not legal
proceedings are actually commenced;

 

(g)           Except for a Default
pursuant to Section 16.01(l), Landlord may immediately or at any time
thereafter, upon written notice to Tenant (except in the event of an emergency,
in which event no notice shall be necessary), at Landlord’s sole option but
without any obligation to do so, correct such Default and charge Tenant all
reasonable costs and expenses incurred by Landlord therein. Any sum or sums so
paid by Landlord, together with any accrued Default Interest, shall be deemed
to be Rent hereunder and shall be immediately due from Tenant to Landlord. Any
such acts by Landlord in correcting Tenant’s Defaults hereunder shall not be
deemed to cure said Defaults or constitute any waiver of Landlord’s right to
exercise any or all remedies set forth herein;

 

(h)           Landlord may
immediately or at any time thereafter, and with or without notice, except as
required herein, set off any money of Tenant held by Landlord under this Lease
or Other Lease against any sum owing by Tenant hereunder or owed under the
Other Lease; provided that, subject to a Mortgagee’s right to credit the
balance of any reserves held by the Mortgagee against future payments on the applicable
debt, any Impositions Reserve or Insurance Reserve (as such terms are defined
in Section 30.01) held by Landlord shall be applied and disbursed in
accordance with Article 30; and/or

 

(i)            Landlord may seek
any equitable relief available to Landlord, including, without limitation, the
right of specific performance.

 

16.03       Final Damages. If this Lease is
terminated by Landlord as provided in Section 16.02(a), in addition
to Landlord’s rights set forth in Section 16.02, Landlord shall be
entitled to recover from Tenant all Rent accrued and unpaid for the period up
to and including such termination date, as well as all other additional sums
payable by Tenant, or for which Tenant is liable or in respect of which Tenant
has agreed to indemnify Landlord under any of the provisions of this Lease,
which may be then owing and unpaid, and all costs and expenses,

 

34

 

including
court costs and reasonable attorneys’ fees incurred by Landlord in the
enforcement of its rights and remedies hereunder.

 

16.04       Removal of Personal Property. All of
Tenant’s Personalty removed from any Property Location by Landlord pursuant to
any provisions of this Lease or any Laws may be handled, removed or stored by
Landlord at the sole cost and expense of Tenant, and Landlord, in no event,
shall be responsible for the value, preservation or safekeeping thereof. Tenant
shall pay Landlord for all expenses incurred by Landlord in such removal and
storage charges against such property as long as the same is in Landlord’s
possession or under Landlord’s control. Subject to Section 31.13, all of
Tenant’s Personalty not removed from any Property Location or retaken from
storage by Tenant within twenty (20) days after the end of the Term, however terminated,
at Landlord’s option, shall be conclusively deemed to have been conveyed by
Tenant to Landlord as by bill of sale without further payment or credit by
Landlord to Tenant.

 

16.05       Landlord’s Default. If Landlord shall
violate, neglect or fail to perform or observe any of the representations,
covenants, provisions, or conditions contained in this Lease on its part to be
performed or observed, which default continues for a period of more than thirty
(30) days after receipt of written notice from Tenant specifying such default
(provided, however, such period shall be limited to two (2) business days with
respect to a default under Section 31.17(g)), or if such default is of a nature
to require more than thirty (30) days for remedy and continues beyond the time
reasonably necessary to cure (provided Landlord must have undertaken procedures
to cure the default within such thirty (30) day period and thereafter
diligently pursues such efforts to cure to completion, provided, that Landlord
shall not have such additional period to cure with respect to a default under
Section 31.17(g)), Tenant, at its option (in addition to all other rights and
remedies provided Tenant at law, in equity or hereunder), upon further written
notice to Landlord of Tenant’s intention to exercise any remedy hereunder,
which shall provide Landlord with an additional ten (10) days cure period
thereafter (provided that Landlord shall not have such additional period to
cure with respect to a default under Section 31.17(g)), may either terminate
this Lease upon written notice thereof given to Landlord, or incur any
reasonable expense necessary to perform the obligation of Landlord specified in
such notice and bill Landlord for the costs thereof. If Landlord fails to
reimburse Tenant for such reasonable costs within thirty (30) days after
Landlord’s receipt of such bill, Tenant may deduct such costs from the next due
installments of Monthly Base Rent, until such costs are recouped by Tenant.

 

16.06       Attorneys’ Fees. The defaulting party
shall pay all of the non-defaulting party’s costs, charges and expenses,
including court costs and reasonable attorneys’ fees, incurred in enforcing the
defaulting party’s obligations under this Lease, incurred by the non-defaulting
party in any action brought by a party in which the other party is the
prevailing party, or incurred by a prevailing party in any litigation,
negotiation or transaction in which the other party causes such prevailing
party, without such prevailing party’s fault, to become involved or concerned.

 

16.07       Tenant Waiver. Tenant hereby expressly
waives, for itself and all Persons claiming by, through and under Tenant,
including creditors of all kinds, (a) any right and privilege which Tenant has
under any present or future Legal Requirements to redeem the Premises, or any
part thereof, or to have a continuance of this Lease for the Term after
termination of Tenant’s right of occupancy by order or judgment of any court or
by any legal process or writ, or under the terms of this Lease; (b) the
benefits of any present or future Legal

 

35

 

Requirements
that exempt property from liability for debt or for distress for rent; (c) any
present or future Legal Requirements relating to notice or delay in levy of
execution in case of eviction of a tenant for nonpayment of rent; and (d) any
benefits and lien rights which may arise pursuant to any present or future
Legal Requirements.

 

ARTICLE 17.

SUBORDINATION; LEASEHOLD MORTGAGE

 

17.01       Subordination. Landlord has executed
and delivered and may execute and deliver hereafter from time to time a
mortgage or trust deed in the nature of a mortgage, both being hereinafter
referred to as a “Mortgage,” against any Parcel and improvements thereon
or any interest therein. Landlord also may, subject to the approval of any
Mortgagee (which approval Mortgagee, in its sole discretion, may withhold),
hereafter sell and lease back any Property Location, or any part thereof, such
lease of the underlying land herein called a “Ground Lease,” and the
landlord under any such lease is herein called a “Ground Landlord.”  If requested by the mortgagee or trustee
under any Mortgage (both being hereinafter referred to as a “Mortgagee”)
or by any Ground Landlord, Tenant will either (a) subordinate its interest
in this Lease to said Mortgage or said Ground Lease, as the case may be, and to
any and all advances made thereunder and to the interest thereon, and to all
renewals, replacements, supplements, amendments, modifications and extensions
thereof, or (b) make certain of Tenant’s rights and interests in this
Lease superior thereto; and Tenant will execute and deliver such agreement or
agreements promptly, as may be reasonably approved by Tenant, Landlord or such
Mortgagee, or such Ground Landlord, as the case may be. Any Mortgage to which
this Lease is now or hereafter subordinate shall provide, in effect, that
during the time this Lease is in force all insurance proceeds and condemnation
awards shall be permitted to be used for restoration in accordance with the
provisions of this Lease. Notwithstanding anything herein to the contrary, as a
condition to subordinating its rights and interests under this Lease to any
such Mortgagee or such Ground Landlord, as the case may be, so long as no Default
has occurred and is continuing, Tenant’s rights and interests under this Lease
shall remain enforceable and undisturbed and Mortgagee or such Ground Landlord,
as the case may be, shall enter into a subordination, non-disturbance and
attornment agreement with Tenant, which agreement shall be substantially in the
form attached hereto as Exhibit E, or in such other form as may be
reasonably approved by Tenant, Landlord, such Mortgagee or such Ground
Landlord.

 

17.02       Liability of Mortgagee; Attornment. It
is further agreed that (a) if any Mortgage shall be foreclosed, or if any
Ground Lease shall be terminated, (i) the Mortgagee (or its grantees) or
purchaser at any foreclosure sale (or grantee in a deed in lieu of
foreclosure), or Ground Landlord, as the case may be, or their respective
successors and assigns shall not be (1) liable for any act or omission of any
prior landlord (including Landlord), subject to any defenses, offsets or
counterclaims which Tenant may have against a prior landlord (including Landlord)
as long as the same are not continuing, (2) bound by any obligation to perform
any work or to make improvements to the applicable Property Location, or any
portion thereof, or (3) bound by any prepayment of Base Rent or other Rent
which Tenant may have made in excess of the amounts then due for the next
succeeding month (other than any reserves paid under this Lease), (ii) the
liability of the Mortgagee hereunder or purchaser at such foreclosure sale or
the liability of a subsequent owner designated as Landlord under this Lease
shall exist only so long as such Mortgagee, Ground Landlord, purchaser or
owner, as applicable, is the owner of the applicable

 

36

 

Building or
Parcel and such liability shall not continue or survive after further transfer
of ownership; and (iii) upon request of the Mortgagee if the Mortgage is
foreclosed, or of the Ground Landlord if the Ground Lease is terminated, and
provided that Tenant’s rights and interests under this Lease shall remain
enforceable and undisturbed, Tenant will attorn, as Tenant under this Lease, to
the purchaser at any foreclosure sale under any Mortgage, and Tenant will
attorn as the tenant under this Lease to the Ground Landlord, and Tenant will
execute such instruments as may be reasonably necessary or appropriate to
evidence such attornment; and (b) this Lease may not be modified or amended so
as to reduce Rent or shorten the Term provided hereunder, or so as to affect
adversely in any other respect or to any material extent the rights of
Landlord, and this Lease shall not be cancelled or surrendered, without the
prior written consent, in each instance, of the Mortgagee or of the Ground
Landlord, as the case may be, other than as expressly permitted pursuant to the
terms of this Lease.

 

17.03       Tenant Leasehold Mortgage.

 

(a)           Provided that, at
the time Tenant proposes to grant any Leasehold Mortgage (as defined in Section
17.03(c)(i)), no Default exists, Tenant shall have the right to grant a
Leasehold Mortgage on Tenant’s leasehold interest in the Premises with respect
to all but not less than all of the entire Premises. Any Tenant’s Mortgagee (as
defined in Section 31.13) or permitted Leasehold Mortgagee (as defined
in Section 17.03(c)(ii)) shall be deemed to be a third party beneficiary
of any subordination, non-disturbance and attornment agreement granted to
Tenant hereunder, but (i) any such Leasehold Mortgage otherwise shall be
in all respects subject and subordinate to Landlord’s interest in this Lease and
to any Mortgage or Ground Lease granted by Landlord, and to any renewals,
modifications, consolidations, replacements and extensions of any such Mortgage
or Ground Lease, whether such Mortgage or Ground Lease, or any renewal,
modification, consolidation, replacement or extension thereof, is granted by
Landlord prior or subsequent to any Leasehold Mortgage granted by Tenant; and
(ii) the Leasehold Mortgage shall attach to and be a lien on Tenant’s leasehold
interest in the Premises only, shall convey no interest or rights in and to
Landlord’s interest in the Lease or the Premises which are greater than Tenant’s
interest or rights in the Lease or the Premises, and shall be in form and
substance reasonably satisfactory to Landlord and Tenant.

 

(b)           If Tenant shall
grant a Leasehold Mortgage in compliance with the provisions of this Section
17.03, and if Tenant or the Leasehold Mortgagee shall, within thirty (30)
days after the execution of such Leasehold Mortgage, send to Landlord a true
copy thereof, together with written notice specifying the name and address of
the Leasehold Mortgagee thereunder and the pertinent recording data with
respect to such Leasehold Mortgage, then, so long as such Leasehold Mortgage
shall remain unsatisfied of record, the following provisions shall apply:

 

(i)            Landlord shall use
commercially reasonable efforts to give the Leasehold Mortgagee, at the address
for the Leasehold Mortgagee given to Landlord as provided above, a copy of any
notice of default hereunder that relates to the portions of the Premises
applicable to the Leasehold Mortgage at the approximate time and in a similar
manner of giving such notice or communication to Tenant; provided, however, that the failure to
deliver such notice shall not constitute a default by Landlord hereunder. Landlord
will not exercise any right, power or remedy with respect to any Default
hereunder that relates to the portions of the

 

37

 

Premises
applicable to the Leasehold Mortgage, and no notice to Tenant of any such
Default shall be effective, until Landlord shall have so given to the Leasehold
Mortgagee written notice or a copy of its notice to Tenant of such Default. Landlord
acknowledges that the Leasehold Mortgagee shall have the right to approve any
amendment that changes the permitted use, term, rent or any other payment
obligation set forth herein, or that otherwise materially increases Tenant’s
obligations or decreases Tenant’s rights under this Lease.

 

(ii)           Any Leasehold
Mortgagee, in case Tenant shall be in default hereunder, shall, within the
period herein provided, have the right to remedy such default, or cause the
same to be remedied, and Landlord shall accept such performance by or at the
instance of such Leasehold Mortgagee as if the same had been made by Tenant,
provided such remedy has been performed in the time frame and in the same
manner as permitted by Tenant under this Lease. If a receiver cures any
default, Landlord shall accept such cure as though performed by the Leasehold
Mortgagee.

 

(iii)          It is understood
and agreed that any Leasehold Mortgagee, or its designee, or any purchaser in
foreclosure proceedings, any grantee pursuant to an assignment in lieu of
foreclosure, or any other party taking by, through or under a Leasehold
Mortgage or its designee, may become the legal Tenant under this Lease with
respect to the entire Premises through foreclosure proceedings, by assignment
of this Lease in lieu of foreclosure or otherwise; provided, however, that any such designee, purchaser in
foreclosure, grantee pursuant to an assignment in lieu of foreclosure or other
party shall, in all events, take subject to the terms of this Lease.

 

(iv)          Upon any rejection
of this Lease by any trustee of the Tenant in any bankruptcy, reorganization,
arrangement or similar proceeding which would, if it were not for this Article
17, cause this Lease to terminate, without any action or consent by
Landlord, Tenant or any Leasehold Mortgagee, the transfer of Tenant’s interest
hereunder to such Leasehold Mortgagee shall automatically occur. Such Leasehold
Mortgagee may terminate this Lease upon any such transfer by giving notice
thereof to Landlord no later than thirty (30) days after notice of such
transfer. Upon any such termination, such Leasehold Mortgagee shall have no
further obligations hereunder, including any obligations which may have accrued
prior to such termination, except for any obligations previously undertaken by
the Leasehold Mortgagee pursuant to Section 17.03(b)(iii) or caused by
Leasehold Mortgagee’s acts while in physical possession of the Premises or by a
court appointed receiver acting as agent for Leasehold Mortgagee.

 

(v)           Landlord agrees to
use commercially reasonable efforts to give the Leasehold Mortgagee notice of
any condemnation proceedings affecting the applicable Property Location (the
failure of which shall not constitute a default by Landlord hereunder), and
such Leasehold Mortgagee shall have the right to intervene and be made a party
to any such condemnation proceedings to the extent of Tenant’s right to do so
under this Lease.

 

(vi)          If a Leasehold
Mortgagee shall acquire title to Tenant’s interest in the Premises, by
foreclosure of a Leasehold Mortgage thereon, by assignment in lieu of
foreclosure, by an assignment for a nominee or wholly-owned subsidiary of such
Leasehold Mortgagee, or otherwise, such Leasehold Mortgagee may assign this
Lease or sublet or underlet

 

38

 

the Premises
only in compliance with Article 12. Upon any assignment made in
compliance with Article 12 of this Lease in favor of any owner of the
leasehold estate pursuant to this Lease whose interest shall have been acquired
by, through or under any Leasehold Mortgagee or from any other holder thereof,
the assignor shall be relieved of any further liability which may accrue under
this Lease from and after the date of such assignment, provided that the
assignee shall execute and deliver to Landlord a recordable instrument of
assumption wherein such assignee shall assume and agree to perform and observe
the covenants and conditions in this Lease contained on Tenant’s part to be
performed and observed, it being the intention that once the Leasehold
Mortgagee shall succeed to Tenant’s interest under this Lease, any and all
subsequent assignments (whether by such Leasehold Mortgagee, any purchaser at a
foreclosure sale or any other transferee or assignee) shall, subject to the
provisions of Article 12, effect a release of the assignor’s liability
under this Lease from and after such assignment.

 

(vii)         There shall be no
merger of this Lease nor of the leasehold estate created by this Lease with the
fee estate in the Premises or any part thereof by reason of the fact that the
same person, firm, corporation or other entity may acquire or own or hold,
directly or indirectly, (1) this Lease or the leasehold estate created by
this Lease or any interest in this Lease or in any such leasehold estate, and
(2) the fee estate in the Premises or any part thereof or any interest in such
fee estate, and no such merger shall occur unless and until all corporations,
firms and other entities, including any Leasehold Mortgagee, having any
interest in (A) this Lease or the leasehold estate created by this Lease and
(B) the fee estate in the Premises or any part thereof or any interest in such
fee estate shall join in a written instrument effecting such merger and shall
duly record the same.

 

(viii)        Notwithstanding
anything herein to the contrary, the provisions of this Article 17 shall
inure only to the benefit of the Leasehold Mortgage which is a first lien on
Tenant’s interest in the Premises. Landlord shall, upon request, execute,
acknowledge and deliver to such Leasehold Mortgagee after its request an
agreement prepared at the sole cost and expense of Tenant, in form reasonably
satisfactory to such Leasehold Mortgagee and Landlord, among Landlord, Tenant
and such Leasehold Mortgagee, agreeing to all of the provisions of this Section
17.03.

 

(c)           Definition of Terms.

 

(i)            For purposes of
this Lease, “Leasehold Mortgage” shall mean a mortgage upon Tenant’s
leasehold estate and other rights of Tenant created pursuant to this Lease, and
Tenant’s rights under any subleases.

 

(ii)           For purposes of
this Lease, “Leasehold Mortgagee” shall mean any mortgagee, trustee, or
secured party under a Leasehold Mortgage. The Leasehold Mortgagee shall be an
insurance company, savings bank, commercial bank (acting as a trustee, agent or
otherwise), or other institutional lending source having a capital and surplus
or net assets of at least Two Hundred Fifty Million Dollars ($250,000,000).

 

39

 

ARTICLE 18.

MORTGAGEE PROTECTION

 

Tenant agrees to give the Mortgagee or Ground Landlord, as the case may
be, by overnight courier service or by registered or certified mail, a copy of
any notice or claim of default served upon Landlord by Tenant, provided that
prior to such notice, Tenant has been notified in writing, by way of service on
Tenant of a copy of an assignment of Landlord’s interests in leases, or
otherwise, of the address of such Mortgagee or Ground Landlord, as the case may
be. Tenant further agrees that such Mortgagee or Ground Landlord, as the case
may be, shall have the right to cure such default within the time period
provided for hereunder for Landlord to cure any Landlord Default.

 

ARTICLE 19.

ESTOPPEL CERTIFICATE

 

Tenant and Landlord agree, from time to time and upon not less than ten
(10) days’ prior request by either of them to the other, to deliver to the
requesting party a statement in the form attached hereto as Exhibit C
certifying to any mortgagee, purchaser or assignee, as the case may be, of such
party (or proposed mortgagee, purchaser or assignee, as the case may be, of
such party’s interest) (a) that this Lease is unmodified and in full force
and effect (or if there have been modifications, that this Lease, as modified,
is in full force and effect and identifying the modifications); (b) the
date upon which Tenant began paying Rent and the dates to which Rent and other
charges have been paid; (c) that the requesting party is not in default
under any provision of this Lease, or, if in default, the nature thereof in
detail; (d) that the Tenant is in occupancy of each Property Location and paying
Rent on a current basis with no rental offsets or claims; (e) that there
has been no prepayment of Rent other than that provided for in this Lease;
(f) that there are no actions, whether voluntary or otherwise, pending
against the other party under the bankruptcy laws of the United States or any
state thereof; and (g) such other matters as may be reasonably requested
to the knowledge of the party providing the estoppel.

 

ARTICLE 20.

REPRESENTATIONS AND WARRANTIES OF TENANT

 

The representations and warranties of Tenant contained in this Article
20 are being made as of the Effective Date to induce Landlord to enter into
this Lease and Landlord has relied upon such representations and warranties. Tenant
represents and warrants to Landlord as of the Effective Date as follows:

 

20.01       Organization, Authority and Status of Tenant.
Tenant has been duly organized or formed, is validly existing and in good
standing under the laws of its state of formation and is qualified as a limited
liability company to do business in any jurisdiction where such qualification
is required except where the failure to be so qualified would not have a
Material Adverse Effect. All necessary company action has been taken to
authorize the execution, delivery and performance by Tenant of this Lease and
of the other documents, instruments and agreements provided for herein. Tenant
is not a “foreign limited liability company,” “foreign corporation,” “foreign
partnership,” “foreign trust” or “foreign estate,” as those terms are defined
in the Code and the regulations promulgated thereunder. The individual who has
executed this Lease on behalf of Tenant is duly authorized to do so.

 

40

 

20.02       Enforceability. Assuming the due
authorization, execution and delivery hereof by Landlord, this Lease
constitutes the legal, valid and binding obligation of Tenant, enforceable
against Tenant in accordance with its terms, except as such enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors’ rights generally and the availability of
injunctive relief and other equitable remedies.

 

20.03       Property Condition. Tenant has
physically inspected all of the Premises and has examined title to the
Premises, and has found all of the same satisfactory in all respects for all of
Tenant’s purposes.

 

20.04       Litigation. There are no suits,
actions, proceedings or investigations pending, or to the best of its
knowledge, threatened against or involving Tenant or the Premises before any
arbitrator or governmental authority which could reasonably be expected to
result in a Material Adverse Effect in the operations of Tenant or the
Premises.

 

20.05       Compliance With OFAC Laws. Neither
Tenant nor any direct member of Tenant is an individual or entity whose
property or interests are subject to being blocked under Executive Order 13224
issued by the President of the United States and all regulations promulgated
thereunder (the “OFAC Laws”) or is otherwise in violation of any of the
OFAC Laws; provided, however,
that the representation contained in this sentence shall not apply to any
individual, partnership, corporation, limited liability company, trust, or
other form of entity (“Person”) to the extent such Person’s interest is
in or through an entity whose securities are listed on a national securities
exchange or quoted on an automated quotation system in the United States or a
wholly-owned subsidiary of such entity.

 

20.06       Ownership. The interests in SKO Group
Holdings, LLC, a Delaware limited liability company that indirectly owns all of
the shares of Tenant, are directly owned by the persons identified on the
letter from Tenant to Landlord of even date herewith.

 

20.07       Absence of Breaches or Defaults. Tenant
is not in default under any document, instrument or agreement to which Tenant
is a party or by which Tenant or the Premises is subject or bound, which has
had, or could reasonably be expected to result in, a Material Adverse Effect
against Tenant or the Premises. The authorization, execution, delivery and
performance of this Lease and the documents, instruments and agreements
provided for herein will not result in any breach of or default under any
document, instrument or agreement to which Tenant is a party or by which Tenant
or the Premises is subject or bound, which has had, or could reasonably be
expected to result in, a Material Adverse Effect against Tenant or the
Premises.

 

20.08       Solvency. There is no contemplated,
pending or threatened Insolvency Event or similar proceedings, whether
voluntary or involuntary, against Tenant. The term “Insolvency Event”
shall mean (a) a failure to generally pay debts as such debts become due,
admitting in writing an inability to pay debts generally or making a general
assignment for the benefit of creditors; (b) any proceeding being
instituted by or against Tenant (i) seeking to adjudicate it bankrupt or
insolvent; (ii) seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, or composition of it or its debts
under any law relating to bankruptcy, insolvency, or reorganization or relief
of debtors; or (iii) seeking the entry of an order for relief or the
appointment of a receiver, trustee, or other similar official for it or for any

 

41

 

substantial
part of its property, and in the case of any such proceeding instituted
against, either such proceeding shall remain undismissed for a period of one
hundred twenty (120) days or any of the actions sought in such proceeding shall
occur; or (c) the taking of any corporate or company action to authorize
any of the actions set forth above in this definition.

 

20.09       Licenses and Permits. Tenant has
obtained or has the use of all required licenses and permits, both governmental
and private, to use and operate the Premises as currently used except where the
failure to have such licenses and permits would not have a Material Adverse
Effect.

 

ARTICLE 21.

NONWAIVER

 

No waiver of any condition expressed in this Lease shall be implied by
any neglect of Landlord or Tenant to enforce any remedy on account of the
violation of such condition whether or not such violation is continued or
repeated subsequently, and no express waiver shall affect any condition other
than the one specified in such waiver and that one only for the time and in the
manner specifically stated. Without limiting any of Landlord’s rights under
this Lease, it is agreed that no receipt of monies by Landlord from Tenant
after the expiration or early termination in any way of the Term or of Tenant’s
right of possession hereunder or after the giving of any notice shall
reinstate, continue or extend the Term or affect any notice given to Tenant
prior to the receipt of such monies. It is also agreed that after the service
of notice or the commencement of a suit or after final judgment for possession
of the Premises, Landlord may receive and collect any monies due, and the
payment of said monies shall not waive or affect said notice, suit or judgment.

 

ARTICLE 22.

INTENTIONALLY DELETED

 

ARTICLE 23.

REAL ESTATE BROKERS

 

Each party represents to the other that it has not dealt with any
broker, agent, or finder in connection with this Lease and agrees to indemnify
and hold the other harmless from all damages, liability and expense, including
reasonable attorneys’ fees, arising from any claims or demands of any broker,
agent or finder for any commission alleged to be due such broker, agent or
finder in connection with its having introduced that party to the Premises or
having participated in the negotiation of the sale and lease-back of the
Premises.

 

ARTICLE 24.

NOTICES

 

All notices and demands required or desired to be given by either party
to the other with respect to this Lease or the Premises shall be in writing and
shall be delivered personally, sent by overnight courier service, prepaid, or
sent by United States registered or certified mail, return receipt requested,
postage prepaid, and addressed as herein provided. Notices to or demands upon
Tenant shall be addressed to Tenant at 700 Pilgrim Way, Green Bay, Wisconsin
54304, Attention:  Chief Financial
Officer and General Counsel, with a copy to each of C. Deryl Couch

 

42

 

and Scott King at Sun Capital Partners, Inc., 5200 Town Center Circle,
Suite 470, Boca Raton, Florida 33486, and with a copy to Klehr, Harrison,
Harvey, Branzburg & Ellers LLP, 260 South Broad Street, 4th
Floor, Philadelphia, Pennsylvania 19102, Attention: Bradley A. Krouse, Esq. Notices
to or demands upon Landlord shall be addressed to Landlord at 14631 N.
Scottsdale Road, Suite 200, Scottsdale, Arizona 85254 2711, Attention:  Michael T. Bennett, SVP, Operations, with a
copy to Kutak Rock LLP, 1801 California Street, Suite 3100, Denver, Colorado
80202, Attention: Peggy A. Richter, Esq. Notices and demands shall be deemed
given and served (a) upon receipt or refusal, if delivered personally, (b) one
(1) business day after deposit with an overnight courier service or (c) upon
three (3) business days after deposit in the United States mails, if mailed.
Either party may change its address for receipt of notices by giving notice of
such change to the other party in accordance herewith.

 

ARTICLE 25.

HAZARDOUS MATERIALS

 

25.01       Defined Terms.

 

(a)           “Claim” shall
mean and include any demand, cause of action, proceeding, or suit for any one
or more of the following: (i) actual or punitive damages, losses, injuries to
Person or property, damages to natural resources, fines, penalties, interest,
contribution or settlement, (ii) seeking a Response (as defined in Section
25.01(f)), (iii) the costs and expenses of site investigations, feasibility
studies, information requests, health or risk assessments, or Response actions,
and (iv) the costs and expenses of enforcing insurance, contribution or
indemnification agreements.

 

(b)           “Environmental
Laws” shall mean and include all federal, state and local statutes,
ordinances, regulations and rules in effect and as amended from time to time
relating to environmental quality, health, safety, contamination and cleanup,
including, without limitation, the Clean Air Act, 42 U.S.C. Section 7401 et
seq.; the Clean Water Act, 33 U.S.C. Section 1251 et seq., and the Water
Quality Act of 1987; the Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”),
7 U.S.C. Section 136 et seq.; the Marine Protection, Research, and Sanctuaries
Act, 33 U.S.C. Section 1401 et seq.; the National Environmental Policy Act, 42
U.S.C. Section 4321 et seq.; the Noise Control Act, 42 U.S.C. Section 4901 et
seq.; the Occupational Safety and Health Act, 29 U.S.C. Section 651 et seq.;
the Resource Conservation and Recovery Act (“RCRA”), 42 U.S.C. Section
6901 et seq., as amended by the Hazardous and Solid Waste Amendments of 1984;
the Safe Drinking Water Act, 42 U.S.C. Section 300f et seq.; the Comprehensive
Environmental Response, Compensation and Liability Act (“CERCLA”), 42
U.S.C. Section 9601 et seq., as amended by the Superfund Amendments and
Reauthorization Act, the Emergency Planning and Community Right-to-Know Act,
and the Radon Gas and Indoor Air Quality Research Act; the Toxic Substances
Control Act (“TSCA”), 15 U.S.C. Section 2601 et seq.; the Atomic Energy
Act, 42 U.S.C. Section 2011 et seq., and the Nuclear Waste Policy Act of 1982,
42 U.S.C. Section 10101 et seq., and state and local superlien and
environmental statutes and ordinances, with implementing regulations, rules and
guidelines, as any of the foregoing may be amended from time to time.
Environmental Laws shall also include all state, regional, county, municipal,
and other local laws, regulations, and ordinances insofar as they are
equivalent or similar to the federal laws recited above or purport to regulate
Hazardous Materials (as defined in Section 25.01(c)).

 

43

 

(c)           “Hazardous
Materials” shall mean and include the following, including mixtures
thereof: any hazardous substance, mold, pollutant, contaminant, waste,
by-product or constituent regulated under CERCLA; oil and petroleum products
and natural gas, natural gas liquids, liquefied natural gas and synthetic gas
usable for fuel; pesticides regulated under FIFRA; asbestos and
asbestos-containing materials, PCBs, and other substances regulated under TSCA;
source material, special nuclear material, by-product material and any other
radioactive materials or radioactive wastes, however produced, regulated under
the Atomic Energy Act or the Nuclear Waste Policy Act; chemicals subject to the
OSHA Hazard Communication Standard, 29 C.F.R. § 1910.1200 et seq.; and
industrial process and pollution control wastes whether or not hazardous within
the meaning of RCRA, and any other hazardous substance, pollutant or
contaminant regulated under any other Environmental Law.

 

(d)           “Manage” or “Management”
means to generate, manufacture, process, treat, store, use, re-use, refine,
recycle, reclaim, blend or burn for energy recovery, incinerate, accumulate
speculatively, transport, transfer, dispose of or abandon Hazardous Materials.

 

(e)           “Release” or “Released”
shall mean any actual or threatened spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping or
disposing of Hazardous Materials into the environment, as “environment” is
defined in CERCLA.

 

(f)            “Response”
or “Respond” shall mean action taken to correct, remove, remediate,
clean up, prevent, mitigate, monitor, evaluate, investigate, assess or abate
the Release of a Hazardous Material.

 

25.02       Tenant’s Obligations with Respect to Environmental
Matters. During the Term, (a) Tenant shall comply, at its sole
cost and expense, with all Environmental Laws; (b) Tenant shall not,
except as utilized in the ordinary course of business and not in violation of
any Environmental Laws, Manage or authorize the Management of, any Hazardous
Materials on any Property Location, including installation of any underground
storage tanks, without prior written disclosure to and prior written reasonable
approval by Landlord, except in accordance with applicable Environmental Laws;
(c) Tenant shall not take any action that would subject any Property Location
to the permit requirements under RCRA or any analogous state law, for storage,
treatment or disposal of Hazardous Materials; and (d) Tenant shall arrange at
its sole cost and expense, for the lawful transportation and off-site disposal
at permitted landfills or other permitted disposal facilities and otherwise in
accordance with all applicable Environmental Laws, of all Hazardous Materials
that it generates.

 

25.03       Copies of Notices. During the Term,
Tenant shall provide Landlord promptly with copies of all summons, citations,
directives, information inquiries or requests, notices of potential
responsibility, notices of violation or deficiency, orders or decrees, Claims,
complaints, investigations, judgments, letters, notices of environmental liens
or Response actions in progress, and other communications, written or oral,
actual or threatened, from the United States Environmental Protection Agency,
Occupational Safety and Health Administration, the Environmental Protection
Agency for the state in which the Premises are located, or other federal,
state, or local agency or authority, or any other entity or individual,
concerning (a) any actual or alleged Release of a Hazardous Materials on, to or
from any Property Location; (b) the

 

44

 

imposition of
any lien on any Property Location; (c) any actual or alleged violation of, or
responsibility under, any Environmental Laws; or (d) any actual or alleged
liability under any theory of common law tort or toxic tort, including without
limitation, negligence, trespass, nuisance, strict liability, or ultrahazardous
activity (each a “Notice”).

 

25.04       Landlord’s Right to Inspect. Upon the
receipt of a Notice, or in the event that Landlord makes a good faith
determination that such inspection is necessary, Landlord and Landlord’s
employees, agents and representatives shall have the right to enter the
applicable Property Location and, at Tenant’s sole cost and expense, conduct
appropriate inspections or tests for the purpose of determining Tenant’s
compliance with Environmental Laws, and determine the type, kind and quantity
of all products, materials and substances brought onto the Premises, or made or
produced thereon. Landlord and its agents and representatives shall have the
right to take samples in quantities sufficient for analysis of all products,
materials and substances present on the applicable Property Location including,
but not limited to, samples, products, materials or substances brought onto or
made or produced on the applicable Property Location by Tenant or its agents,
employees, contractors or invitees. Tenant agrees to cooperate with such
investigations by providing any relevant information reasonably requested by
Landlord. Tenant may not perform any sampling, testing, or drilling to locate
Hazardous Materials in the applicable Property Location without Landlord’s
prior written consent.

 

25.05       Tests and Reports. With respect to any
applicable Property Location and upon the receipt of a Notice (or in the event
that Landlord makes a good faith determination that the same is necessary),
Tenant shall, at its sole cost and expense, perform any environmental site
assessment or other investigation of environmental conditions in connection
with the Premises as may be reasonably requested by Landlord (including but not
limited to sampling, testing and analysis of soil, water, air, building
materials and other materials and substances whether solid, liquid or gas). Tenant
shall provide Landlord with (a) copies of all environmental reports and tests
obtained by Tenant; (b) copies of transportation and disposal contracts (and
related manifests, schedules, reports, and other information) entered into or
obtained by Tenant with respect to any Hazardous Materials; (c) copies of any
permits issued to Tenant under Environmental Laws with respect to the
applicable Property Location; (d) copies of any and all reports, notifications,
and other filings made by Tenant to any federal, state, or local environmental
authorities or agencies; and (e) any other applicable documents and information
with respect to environmental matters relating to the applicable Property
Location. Tenant shall provide Landlord with the results of appropriate reports
and tests, with transportation and disposal contracts for Hazardous Materials,
with any permits issued under Environmental Laws, and with any other documents
necessary to demonstrate that Tenant complies with all Environmental Laws relating
to the applicable Property Location, including, without limitation, payment of
penalties or interest related thereto.

 

25.06       Tenant’s Obligation to Respond. If
Tenant’s Management of Hazardous Materials at any Property Location (a) gives
rise to liability or to a Claim under any Environmental Law, or any common law
theory of tort or otherwise; (b) causes a threat to, or endangers, the public
health; or (c) creates a nuisance or trespass, Tenant shall, at its sole cost
and expense, promptly take all necessary action in response so as to comply
with all applicable Environmental Laws and eliminate or avoid any liability
claim with respect thereto. Additionally, Tenant shall, at its sole cost and
expense, and without limiting any other provision

 

45

 

of this Lease,
effectuate any Response required by any governmental authority of any condition
(including, but not limited to, a Release) in, on, under or from the Premises
and take any other reasonable action deemed necessary by any governmental
authority for protection of human health or the environment. Notwithstanding
anything in this Lease to the contrary, Tenant shall have the right to
challenge and not comply with any requirement of a governmental authority
without being in breach of this Lease so long as Tenant (i) pursues such
challenge diligently and in good faith and (ii) complies with any
requirement that results upon completion of such challenge.

 

25.07       Landlord’s Right to Act. In the event
that Tenant shall fail to comply with any of its obligations under this Article 25
as and when required hereunder, after thirty (30) days written notice to Tenant
and Tenant’s failure to commence to cure such failure (unless any Property
Location or any Person is in imminent danger of harm, in which case notice that
is feasible under the circumstances shall be given to Tenant), Landlord shall
have the right (but not the obligation) to take such action as is required to
be taken by Tenant hereunder and in such event, Tenant shall be liable and
responsible to Landlord for all costs, expenses, liabilities, claims and other
obligations paid, suffered, or incurred by Landlord in connection with such
matters. Tenant shall reimburse Landlord immediately upon demand for all such
amounts for which Tenant is liable with interest accruing at the Default
Interest rate.

 

25.08       Indemnification. Except as otherwise
required under applicable Laws or to the extent of Landlord’s willful wrongful
acts or gross negligence (provided that the term “gross negligence” shall not
include gross negligence imputed as a matter of law to any of the Landlord
Indemnified Parties solely by reason of Landlord’s interest in any Property
Location or Tenant’s failure to act in respect of matters which are or were the
obligation of Tenant under this Lease), Tenant shall, immediately upon demand
by Landlord, indemnify, save, protect, defend and hold harmless the Landlord
Indemnified Parties from and against any and all Claims, Response costs,
liabilities, suits, obligations, fines, damages, penalties, claims, costs,
losses, charges and expenses, including, without limitation, loss of rental
income, loss due to business interruption, and reasonable attorneys’ fees and
costs, which may be imposed upon or incurred during or after (but attributable
to a period of time falling within) the Term arising out of or in any way
connected with any or all of the following occurring:

 

(a)           any Hazardous
Materials which are, or have been at any time, Managed, Released or otherwise
located on or at any Property Location during the Term (regardless of the
location at which such Hazardous Materials may in the future be located or
disposed of), including but not limited to, any and all (i) liabilities under
any common law theory of tort, nuisance, strict liability, ultrahazardous
activity, negligence or otherwise based upon, resulting from or in connection
with any such Hazardous Materials; and (ii) obligations to take Response,
cleanup or corrective action pursuant to any investigation or remediation in
connection with the decontamination, removal, transportation, incineration, or
disposal of any of the foregoing;

 

(b)           any actual or
alleged illness, disability, injury, or death of any individual in any manner
arising out of or allegedly arising out of exposure to Hazardous Materials or
other substances or conditions introduced to any Property Location during the
Term;

 

46

 

(c)           any actual or
alleged failure of Tenant or prior occupant or owner to comply with all
applicable Environmental Laws during the Term; and

 

(d)           any failure by
Tenant to comply with its obligations under this Article 25.

 

In the event any Claims or other assertion of liability shall be made
against Landlord for which Landlord is entitled to indemnity hereunder,
Landlord shall notify Tenant of such Claim or assertion of liability and
thereupon Tenant shall, at its sole cost and expense, assume the defense of
such Claim or assertion of liability (with counsel reasonably acceptable to
Landlord) and continue such defense at all times thereafter until completion.
The obligations of Tenant under this Article 25 shall survive for a
period of five (5) years from the termination or expiration of this Lease.

 

ARTICLE 26.

TITLE AND COVENANT AGAINST LIENS

 

26.01       Title and Covenant Against Liens. Landlord’s
title in the Premises is and always shall be paramount to the title of Tenant
and nothing contained in this Lease shall empower Tenant to do any act which
can, shall or may encumber the title of Landlord. Tenant covenants and agrees
not to suffer or permit any lien of mechanics or materialmen to be placed upon
or against the Premises, the Buildings or the Parcels and, in case of any such
lien attaching, to pay and remove or insure over same promptly. Except as
provided in this Section 26.01 below and Section 9.04 above,
Tenant has no authority or power to cause or permit any lien or encumbrance of
any kind whatsoever, whether created by act of Tenant, operation of law or
otherwise, to attach to or to be placed upon the Premises, the Buildings or the
Parcels, and any and all liens and encumbrances created by Tenant shall attach
only to Tenant’s interest in the Premises. If any such liens so attach and
Tenant fails to pay and remove or bond the same within thirty (30) days,
Landlord, at its election, may pay and satisfy the same, and in such event, the
sums so paid by Landlord, with interest accruing from the date of Landlord’s
payment at the Default Interest rate shall be deemed to be Rent due and payable
by Tenant at once without notice or demand. Except as permitted pursuant to Section
9.04 and Article 17 of this Lease, Landlord covenants and agrees not
to suffer or permit any covenants, restrictions, reservations, encumbrances,
liens, conditions, encroachments, easements and other matters of title that
would affect one or more of the Property Locations without Tenant’s prior
written consent.

 

Landlord hereby grants a limited power of attorney to Tenant to
acknowledge, deliver and execute on Landlord’s behalf any proposed agreement
affecting the Property Location(s) if such agreement is in the nature of an
easement and (a) is specifically stated to encumber the Property Location(s)
only while Tenant is in possession of the Property Location(s) or (b) shall, by
the terms of the agreement, end with the termination of this Lease. Upon the
execution of any such agreement, Tenant shall deliver, within twenty (20) days
thereof, a copy of such agreement to Landlord.

 

47

 

ARTICLE 27.

EXCULPATORY PROVISIONS

 

It is understood and agreed expressly by and between the parties
hereto, anything herein to the contrary notwithstanding, that each and all of
the representations, warranties, covenants, undertakings and agreements made
herein on the part of Landlord, while in form purporting to be the
representations, warranties, covenants, undertakings and agreements of
Landlord, are nevertheless each and every one of them made and intended, not as
personal representations, warranties, covenants, undertakings and agreements by
Landlord or for the purpose or with the intention of binding Landlord
personally, but are made and intended for the purpose only of subjecting
Landlord’s interest in each Property Location to the terms of this Lease and
for no other purpose whatsoever, and in case of default hereunder by Landlord,
Tenant shall look solely to the interests of Landlord in each Property
Location; that Landlord shall have no personal liability to pay any indebtedness
accruing hereunder or to perform any covenant, either express or implied,
contained herein; and that no personal liability or personal responsibility of
any sort is assumed by, nor at any time shall be asserted or enforceable
against, said Landlord, individually.

 

ARTICLE 28.

QUIET USE AND ENJOYMENT

 

If and as long as Tenant shall faithfully perform the agreements,
terms, covenants and conditions hereof, Tenant shall and may (subject, however,
to the provisions, reservations, terms and conditions of this Lease, including
without limitation, Sections 17.01 and 17.02) peaceably and
quietly have, hold and enjoy the Premises for the Term hereby granted,
including extensions, without molestation or disturbance by or from Landlord or
any Person or entity claiming by, through or under Landlord and free of any
encumbrance created or suffered by Landlord, except from encumbrances created,
suffered or consented to by Tenant. This covenant shall be construed as running
with the land to and against subsequent owners and successors in interest and
is not, nor shall it operate or be construed as, a personal covenant of
Landlord, except to the extent of Landlord’s interest in the Premises and only
so long as such interest shall continue, and thereafter this covenant shall be
binding upon such subsequent owners and successors in interest of Landlord’s
interest under this Lease, to the extent of their respective interests, as and
when they shall acquire the same, and only so long as they shall retain such
interest.

 

ARTICLE 29.

CHARACTERIZATION OF LEASE

 

The following expressions of intent, representations, warranties,
covenants, agreements, stipulations and waivers are a material inducement to
Landlord and Tenant entering into this lease:

 

29.01       Unseverable Lease. Landlord and Tenant
intend that (a) this Lease constitutes an unseverable and single lease of
all, but not less than all, of the Property Locations, and, if at any time this
Lease covers other real property in addition to the Property Locations, neither
this Lease, nor Landlord’s obligations or rights hereunder may be allocated or
otherwise divided among such properties by Tenant; (b) except with respect
to Store Number 3096 in Ely, Minnesota and Store Number 3223 in Plentywood,
Montana, this Lease is a “true lease” for federal and state income tax
purposes, is not a financing lease, capital lease, mortgage, equitable
mortgage, deed of trust, trust agreement, security agreement or other financing
or trust

 

48

 

arrangement,
and the economic realities of this Lease are those of a true lease; and
(c) the business relationship created by this Lease and any related
documents is solely that of a long-term commercial lease between Landlord and
Tenant, the Lease has been entered into by both parties in reliance upon the
economic and legal bargains contained herein, and none of the agreements
contained herein is intended, nor shall the same be deemed or construed, to
create a partnership (de factor or de jure) between Landlord and Tenant, to
make them joint venturers, to make Tenant an agent, legal representative,
partner, subsidiary or employee of Landlord, nor to make Landlord in any way
responsible for the debts, obligations or losses of Tenant.

 

29.02       Waiver. Tenant and Landlord each waive
any claim or defense based upon the characterization of this Lease as anything
other than as a “true lease” and a master lease of all of the Property
Locations. Tenant and Landlord each stipulate and agree (a) not to
challenge the validity, enforceability or characterization of the lease of the
Property Locations as a single, unseverable instrument pertaining to the lease
of all, but not less than all, of the Property Locations, (b) except as
may be required by Laws or a governmental authority (it being understood that
Tenant and Landlord each agree that, except as indicated in Section 29.01(b),
under current U.S. federal income tax law, this Lease is a “true lease”), not
to assert or take, or omit to take, any action if such omission would be
inconsistent with the agreements and understandings set forth in this Article
29, and (c) that, in the event that its separate existence from another
Person is disregarded for U.S. federal income tax purposes, it shall not permit
such Person to assert or take any action, or omit to take any action if such
omission would be, inconsistent with the agreements and understandings set
forth in this Article 29 (determined as though such Person had been a
party hereto).

 

ARTICLE 30.

RESERVES

 

30.01       Reserves. Upon the occurrence of a
Reserve Event (as defined below), Landlord may require Tenant to pay to
Landlord on the day that Monthly Base Rent is next due during the Term an
amount equal to the Impositions (the “Impositions Reserve”), premiums
for insurance required under Article 6 (the “Insurance Reserve”)
and/or maintenance expenses (“Maintenance Expenses”) for the Premises
(in an amount equal to $0.20 per net rentable square foot of the Premises) (the
“Maintenance Reserve”; the Impositions Reserve, the Insurance Reserve
and/or the Maintenance Reserve are each a “Reserve” and collectively,
the “Reserves”) that Landlord reasonably estimates will be necessary in
order to accumulate with Landlord sufficient funds to pay such Impositions,
insurance premiums and Maintenance Expenses as applicable for the earlier of
(a) the ensuing twelve (12) months, or (b) at least thirty (30) days prior to
their respective due dates. Landlord shall hold or cause the Mortgagee to hold
the amount for each Reserve required hereunder in an interest-bearing account
which interest thereon shall accrue for the benefit of Tenant (which may be a
book entry subaccount) (each, a “Reserve Subaccount Account”, and
collectively, the “Reserve Subaccounts”). Landlord shall have the right
to collect Reserves on an annual basis until the occurrence of a Reserve
Reversal Event (defined in Section 30.06 (g) below).

 

30.02       Satisfaction of Tenant’s Obligations. Any
Reserve payments made by Tenant pursuant to Section 30.01 for
Impositions, Maintenance Expenses and insurance premiums shall satisfy Tenant’s
obligations to pay Impositions and Maintenance Expenses and to pay for and

 

49

 

maintain
insurance under this Lease for the applicable twelve (12) month period. Landlord
shall timely pay or cause to be paid such Impositions and insurance premiums or
make such Reserves available to Tenant to timely pay such Impositions and
insurance premiums.

 

30.03       Reserve Period; Maintenance Expenses. During
a Reserve Period (as defined below), Landlord shall disburse or cause the
Mortgagee to disburse funds held in the Reserve Subaccount for Maintenance
Expenses to Tenant within fifteen (15) days after the delivery by Tenant to
Landlord of a request therefor, in an amount greater than Twenty Five Thousand
Dollars ($25,000) (or a lesser amount if the total amount in the Maintenance
Reserve is less than Twenty Five Thousand Dollars ($25,000), in which case only
one such disbursement as to that particular Maintenance Expense shall be made),
provided that the request for disbursement is accompanied by: (a) a
certificate signed by an officer of Tenant: (i) stating that the
maintenance which is the subject of the requested disbursement has been
completed, (ii) identifying each Person that supplied materials or labor in
connection with such maintenance or any portion thereof, and (iii) stating
that each such Person supplying materials or labor has been or, upon receipt of
the requested disbursement, will be paid in full with respect to the portion of
the maintenance which is the subject of the requested disbursement;
(b) copies of appropriate lien waivers, to the extent applicable, or other
evidence of payment reasonably satisfactory to Landlord; and (c) if requested
by Landlord’s Mortgagee, a title search for such Property Location indicating
that such Property Location is free from all liens, claims and other
encumbrances not previously approved by Landlord.

 

30.04       Reserve Reversal Event. Upon a Reserve
Reversal Event, no further Reserves shall be required and any Reserves and/or
Letter of Credit (as defined in Section 30.06(d) below) held by Landlord or
Mortgagee shall be immediately released and/or returned, as the case may be, to
Tenant.

 

30.05       Letter of Credit. Notwithstanding
anything to the contrary contained in this Article 30 or Section
9.05, at Tenant’s option, in lieu of the requirements set forth herein with
respect to Tenant’s obligation to make deposits into one or more Reserve
Subaccounts, Tenant may deliver a Letter of Credit or Letters of Credit to Landlord in an amount or amounts equal
to the aggregate amount which Tenant would otherwise be required to deposit for
Impositions, insurance premiums and/or Maintenance Expenses, over the ensuing
twelve (12) month period, and/or Required Repairs whereupon Landlord shall
remit or cause Mortgagee to remit the Reserves then on deposit, if any, in the
applicable Reserve Subaccount to Tenant. In the event that Tenant delivers a
Letter of Credit or Letters of Credit for Impositions, insurance premiums,
Maintenance Expenses and/or Required Repairs, Tenant shall be responsible for
the payment of such item and Landlord shall not be responsible therefor. Tenant
shall provide Landlord with notice of any increases (or decreases) in the
aggregate payments over the ensuing twelve (12) month period for Impositions,
insurance premiums and/or Maintenance Expenses, as the case may be, not less
than forty-five (45) days prior to the date any such increase (or decrease) is
first due and payable, and the applicable Letter of Credit shall be increased
(or decreased) by an amount equal to such increased (or decreased) amount at
least thirty (30) days prior to the date such increase (or decrease) is first
due and payable. Landlord shall allow a reduction in the Letter of Credit or
Letters of Credit relating to the Reserve Subaccount for Maintenance Expenses
or Required Repairs upon satisfaction of the conditions precedent for
disbursement set forth in Section 30.03 or Section 9.05, as
applicable, which reduction shall be in an amount equal

 

50

 

to the amount
that would have been disbursed to Tenant had the Reserve Account for
Maintenance Expenses or the Required Repairs Subaccount, contained cash. Upon
any non-payment of Impositions, insurance premiums, Maintenance Expenses or
Required Repairs, Tenant agrees that Landlord shall have the right, but not the
obligation, to draw on such  applicable
Letter of Credit and to apply all or any part thereof to the payment of the
item for which such Letter of Credit was established.

 

30.06       Defined Terms.

 

(a)           “EBITDAR”
shall mean, with respect to any Person, for any period, an amount equal to
(without duplication):  (i) the
consolidated net income of such Person for such period, plus
(ii) depreciation, amortization and other non-cash charges (including, but
not limited to, imputed interest, deferred compensation and charges associated
with impairment of goodwill pursuant to FASB 142) for such period (to the
extent deducted in the computation of consolidated net income of such Person),
all in accordance with GAAP, plus (iii) interest expense for such
period (to the extent deducted in the computation of consolidated net income of
such Person), plus (iv) the provision for taxes for such period (to
the extent deducted in the computation of consolidated net income of such
Person), plus (v) any rental amounts (excluding reimbursable
expenses including but not limited to taxes, maintenance and insurance) payable
by such Person under any leases then in effect to which the Person is a party,
utilizing the rental amounts (excluding reimbursable expenses including but not
limited to taxes, maintenance and insurance) in effect at the time of the
EBITDAR calculation (collectively, “EBITDAR Rent”) (to the extent such
EBITDAR Rent was deducted in the computation of consolidated net income of such
Person), plus (vi) non-recurring items and unusual items. In calculating
the EBITDAR Ratio for the combined, consolidated ShopKo/Pamida entity with respect
to periods prior to December 28, 2005, Tenant may use pro forma adjusted
financial statements with customary adjustments made to reflect the acquisition
of ShopKo Stores Inc. by SKO Group Holding, LLC and a pro forma capital
structure. Following the separation of the ShopKo and Pamida entities,
customary pro forma adjustments also may be made to accurately reflect the
historic operations of ShopKo, on the one hand, and Pamida, on the other.

 

(b)           “EBITDAR Event”
shall mean Tenant’s failure to maintain an EBITDAR Ratio (as defined below) of
1.15 to 1 or higher (tested quarterly on a twelve (12) month trailing basis).

 

(c)           “EBITDAR Ratio”
shall be the ratio of EBITDAR to interest and operating lease expenses.

 

(d)           “Letter of Credit”
means an evergreen, irrevocable, unconditional, transferable, clean sight draft
letter of credit, in form and substance acceptable to Landlord in its
reasonable discretion, in favor of Landlord and issued by a bank or financial
institution reasonably acceptable to Landlord.

 

(e)           “Reserve Event”
shall mean the occurrence of (i) a monetary Default or (ii) an EBITDAR Event.

 

51

 

(f)            “Reserve Period”
shall mean the period time commencing on the date that 

(i) a monetary Default shall have occurred or (ii) an EBIDTAR Event shall have
occurred and, with respect to clause (a) or (b), ending upon the occurrence of
a Reserve Reversal Event.

 

(g)           “Reserve Reversal
Event” shall mean Tenant (i) remaining free from monetary Default and (ii)
maintaining an EBITDAR Ratio of 1.15 to 1 or higher (on a twelve (12) month
trailing basis) for a period of not less than four (4) consecutive quarters.

 

ARTICLE 31.

MISCELLANEOUS

 

31.01       Successors and Assigns. Each provision
of this Lease shall extend to and shall bind and inure to the benefit not only
of Landlord and Tenant, but also of their respective heirs, legal
representatives, successors and assigns, but this provision shall not operate
to permit any transfer, assignment, mortgage, encumbrance, lien, charge or
subletting contrary to the provisions of this Lease.

 

31.02       Modifications in Writing. No
modification, waiver or amendment of this Lease or of any of its conditions or
provisions shall be binding upon either party unless in writing and signed by
Landlord and Tenant.

 

31.03       Definition of Tenant. The word “Tenant”
whenever used herein shall be construed to mean Tenant or any one or more of
them in all cases where there is more than one Tenant; and the necessary
grammatical changes required to make the provisions hereof apply either to
corporations, limited liability companies or other organizations, partnerships
or other entities, or individuals, shall be assumed in all cases as though
fully expressed in each case. In all cases where there is more than one Tenant,
the liability of each shall be joint and several. Landlord shall have the
right, at its discretion, to enforce Landlord’s rights under this Lease against
each entity signing this Lease as Tenant, individually, or against all of such
Persons collectively, so that any one of the entities signing this Lease as
Tenant shall be bound to the provisions of this Lease and shall be required to
pay all of the Rent and other amounts from time to time owed by Tenant under
this Lease.

 

31.04       Definition of Landlord. The term “Landlord”
as used in this Lease means only the owner or owners at the time being of each
Property Location so that in the event of any assignment, conveyance or sale,
once or successively, of said Property Location, or any assignment of this
Lease by Landlord, said Landlord making such sale, conveyance or assignment
shall be and hereby is entirely freed and relieved of all covenants and
obligations of Landlord hereunder, if any, accruing after such sale, conveyance
or assignment, and Tenant agrees to look solely to such purchaser, grantee or
assignee with respect thereto. This Lease shall not be affected by any such
assignment, conveyance or sale, and Tenant agrees to attorn to the purchaser,
grantee or assignee.

 

31.05       Headings. The headings of Articles and
Sections are for convenience only and do not limit, expand or construe the
contents of the Articles or Sections.

 

31.06       Time of Essence. Time is of the essence
of this Lease and of all provisions hereof.

 

52

 

31.07       Default Rate of Interest. All amounts,
including, without limitation, Base Rent and Rent, owed by Tenant to Landlord
pursuant to any provision of this Lease shall bear interest from the date due
until paid at the lesser of: (a) the greater of (i) five percent (5%)
in excess of the rate of interest announced from time to time by Wachovia Bank,
National Association (or its successors and assigns), as its prime, reference
or corporate base rate (“Prime”), changing as and when said Prime rate
changes, or (ii) ten percent (10%) per annum; or (b) the maximum rate
permissible by law (“Default Interest”).

 

31.08       Severability. The invalidity of any
provision of this Lease shall not impair or affect in any manner the validity,
enforceability or effect of the rest of this Lease.

 

31.09       Entire Agreement. All understandings
and agreements, oral or written, heretofore made between the parties hereto are
merged in this Lease, which, together with that certain Side-Letter Agreement
between Landlord and Tenant dated as of the Effective Date (the “Side-Letter
Agreement”), fully and completely express the agreement between Landlord
(and its beneficiaries, if any, and their agents) and Tenant. Notwithstanding
anything in this Agreement to the contrary, upon the execution and delivery of
this Lease and the Side-Letter Agreement by Landlord and Tenant, (a) this
Lease and the Side-Letter Agreement shall supersede any previous discussions,
agreements and/or term or commitment letters relating to this Lease and the
Side-Letter Agreement or the Transaction, including without limitation, that
certain Letter of Intent dated March 31, 2006, between SKO Group Holding
Corp., on behalf of Tenant, and Spirit Finance Corporation, on behalf of
Landlord, (b) the terms and conditions of this Lease and the Side-Letter
Agreement shall control notwithstanding that such terms are inconsistent with
or vary from those set forth in any of the foregoing agreements, and (c) this
Lease and the Side-Letter Agreement may only be amended by a written agreement
executed by Landlord and Tenant. The provisions of this Section shall
survive the expiration or earlier termination of this Lease.

 

31.10       Force Majeure. If either party fails to
perform timely any of the terms, covenants and conditions of this Lease on
such party’s part to be performed and such failure is due in whole or in part to
any strike, lockout, civil disorder, inability to procure materials at
commercially reasonable rates, prolonged failure of power, riots,
insurrections, war, fuel shortages, accidents, casualties, acts of God, acts
caused directly or indirectly by the other party (or such other party’s agents,
employees, contractors, licensees or invitees) or any other cause beyond the
reasonable control of such party (expressly excluding, however, the obligations
imposed upon Tenant with respect to Base Rent and any other Rent to be paid
hereunder) (“Force Majeure”), then such party shall not be deemed in
default under this Lease as a result of such failure and any time for
performance by such party provided for herein shall be extended by the period
of delay resulting from such cause.

 

31.11       Memorandum of Lease. This Lease shall
not be recorded. However, a memorandum of this Lease in the form attached
hereto as Exhibit G shall be executed, in recordable form, by both
parties concurrently herewith and may be recorded by Tenant, at Tenant’s
expense, with the official charged with recordation duties for any of the
counties in which a Property Location is located, with directions that it be
returned to Tenant. If, and when, an original memorandum of Lease is returned
to Tenant following recording, Tenant shall furnish a copy of same to Landlord.

 

53

 

31.12       No Construction Against Preparer. This
Lease has been prepared by Tenant and its professional advisors and reviewed by
Landlord and its professional advisors. Landlord, Tenant and their separate
advisors believe that this Lease is the product of their joint efforts, that it
expresses their agreement, and that it should not be interpreted in favor of
either Landlord or Tenant or against either Landlord or Tenant merely because
of their efforts in its preparation.

 

31.13       Waiver of Landlord’s Lien. Notwithstanding
anything contained herein to the contrary, Landlord hereby waives any statutory
liens and any rights of distress with respect to Tenant’s Personalty. This
Lease does not grant a contractual lien or any other security interest to
Landlord or in favor of Landlord with respect to Tenant’s Personalty. Respecting
any mortgagee or other lender of Tenant having a security interest in Tenant’s
Personalty (“Tenant’s Mortgagee”), Landlord agrees as follows: (a) to
provide Tenant’s Mortgagee, upon written request of Tenant (accompanied by the
name and address of Tenant’s Mortgagee), with a copy of any default notice(s)
given to Tenant under this Lease; provided, however, that (i) Landlord
acknowledges and agrees that with respect to Wachovia Bank, National
Association, as agent, as Tenant’s Mortgagee, such Tenant request shall be
deemed to have been made as of the Effective Date, and (ii) the failure to
deliver such notice shall not constitute a default by Landlord hereunder, and (b) to
allow Tenant’s Mortgagee, prior to any termination of this Lease or repossession
of the applicable Property Location by Landlord, the same notice rights and
period of time to cure such default as is allowed Tenant under this Lease, and (c) to
permit Tenant’s Mortgagee to go upon the applicable Property Location for the
purpose of removing Tenant’s Personalty any time within ninety (90) days after
the effective date of any termination of this Lease or any repossession of the
Premises or any part thereof by Landlord. Landlord further agrees to
execute and deliver the form of written waiver reasonably requested by
Tenant’s Mortgagee from time to time to evidence or effect the aforesaid waiver
and agreements of Landlord or substantially in the form attached hereto as
Exhibit F.

 

31.14       Investment Tax Credits. Landlord
expressly waives and relinquishes in favor of Tenant any rights to claim the
benefit of or to use any federal or state investment tax credits that are
currently, or may become, available during the Term as a result of any
installation of any equipment, furniture or fixtures installed by Tenant in or
on the Premises whether or not such items become a part of the realty and
agrees, without cost or liability to Landlord, to execute and deliver to Tenant
any election form reasonably required to evidence Tenant’s right to claim
investment tax credits.

 

31.15       Signage. Tenant shall be entitled to
place signs upon each Property Location subject to any applicable Laws or any
applicable REAs.

 

31.16       Definition of CPI. “CPI” means
the Consumer Price Index which is designated for the applicable month of
determination as the United States City Average for All Urban Consumers, All
Items, Not Seasonally Adjusted, with a based period equaling 100 in 1982 –
1984, as published by the United States Department of Labor’s Bureau of Labor
Statistics or any successor agency. In the event that the Consumer Price Index
ceases to be published, its successor index as published by the same
governmental authority which published the Consumer Price Index shall be
substituted and any necessary reasonable adjustments shall be made by Landlord
and Tenant in order to carry out the intent of this Lease. In the event there
is no successor index, Landlord shall reasonably select an alternative price
index that will constitute a

 

54

 

reasonable
substitute for the Consumer Price Index. “CPI Increase” shall mean the
percentage change in the CPI for the month which is two months prior to the
date of this Lease or the CPI used for the immediately preceding Adjustment Date,
as applicable, and the CPI for the month which is two months prior to the
applicable Adjustment Date.

 

31.17       Financial Statements.

 

(a)           So long as (1) the
provisions of Section 16.01(j) shall be in effect and (2) the
purchase price paid by Spirit Finance Corporation or an affiliate (“Spirit”)
in respect of the Property Locations leased to Tenant hereunder on any
measurement date and the Property
Locations under the Other Lease on such measurement date, on an aggregate
basis, continues to exceed twenty percent (20%) of Spirit’s total assets as of
the date of its most recent audited balance sheet (including any assets
acquired subsequent to the date of that balance sheet if the acquisitions of
those assets were reported in a report on Form 8-K) then, Tenant shall
deliver to Landlord the following financial statements:

 

(i)            within forty-five (45)
days after the end of each fiscal quarter of Tenant (provided, however, that
Tenant shall not be in Default under this Lease for failure to deliver the
Holding Unaudited Financial Reports (defined below) unless such failure to
deliver the Holding Unaudited Financial Reports continues and is not cured
within an additional fifteen (15) days after the aforesaid forty-five (45) day
period), the interim unaudited (A) consolidated balance sheet, statement
of operations, statement of stockholders’ equity and statement of cash flows
and all other related schedules for the fiscal period then ended of SKO Group
Holding Corp. and its consolidated subsidiaries (the “Holding Unaudited
Reporting Financials”), which Tenant acknowledges shall be filed as part of
Spirit’s Securities and Exchange Commission (“SEC”) reporting
obligations; (B) such other financial information reasonably requested by
Landlord to the extent required for Landlord to satisfy its filing obligations
under the rules and regulations of the SEC; and (C) income and
expense statements for the business at each Property Location, in the form attached
hereto as Exhibit J (such information to be subject to the confidentiality
and non-disclosure provisions set forth in Section 31.17(g)).

 

(ii)           within
seventy-five (75) days after the end of each fiscal year of Tenant (provided,
however, that so long as Tenant delivers to Landlord “draft” statements within
the aforesaid seventy-five (75) day period, Tenant shall not be in Default
under this Lease for failure to deliver the Holding Audited Financial Reports
(defined below) unless such failure to deliver the Holding Audited Financial
Reports continues and is not cured within an additional ten (10) days
after the aforesaid seventy-five (75) day period), the audited (A) consolidated
balance sheet, statement of operations, statement of stockholders’ equity and
statement of cash flows and all other related schedules for the fiscal period
then ended of SKO Group Holding Corp. and its consolidated subsidiaries (the “Holding
Audited Reporting Financials”), and together with the Holding Unaudited
Reporting Financials, (the “Holding Reporting Financials”), which Tenant
acknowledges shall be filed as part of Spirit’s SEC reporting obligations;
(B) such other financial information reasonably requested by Landlord to
the extent required for Landlord to satisfy its filing obligations under the rules and
regulations of the SEC; and (C) income and expense statements for the
business at each Property Location (such information to be subject to the
confidentiality and non-disclosure provisions set forth in Section 31.17(g)).

 

55

 

(b)           At
such time as (1) the provisions of Section 16.01(j) are no
longer in effect and (2) the purchase price paid by Spirit in respect of
the Property Locations leased to Tenant hereunder on any measurement date, on
an aggregate basis, continues to exceed twenty percent (20%) of Spirit’s total
assets as of the date of its most recent audited balance sheet (including any
assets acquired subsequent to the date of that balance sheet if the
acquisitions of those assets were reported in a report on Form 8-K) then,
Tenant shall deliver to Landlord the following financial statements:

 

(i)            within forty-five (45)
days after the end of each fiscal quarter of Tenant (provided, however, that
Tenant shall not be in Default under this Lease for failure to deliver the
Tenant Unaudited Financial Reports (defined below) unless such failure to
deliver the Tenant Unaudited Financial Reports continues and is not cured
within an additional fifteen (15) days after the aforesaid forty-five (45) day
period), the interim unaudited (A) consolidated balance sheet, statement
of operations, statement of stockholders’ equity and statement of cash flows
and all other related schedules for the fiscal period then ended of Tenant and
its consolidated subsidiaries (the “Tenant Unaudited Reporting Financials”);
(B) such other financial information reasonably requested by Landlord to
the extent required for Spirit to satisfy its filing obligations under the rules and
regulations of the SEC; and (C) income and expense statements for the
business at each Property Location (such information to be subject to the
confidentiality and non-disclosure provisions set forth in Section 31.17(g)).

 

(ii)           within
seventy-five (75) days after the end of each fiscal year of Tenant (provided,
however, that so long as Tenant delivers to Landlord “draft” statements within
the aforesaid seventy-five (75) day period, Tenant shall not be in Default
under this Lease for failure to deliver the Tenant Audited Reporting Financials
and Tenant Reporting Financials (each defined below) unless such failure to
deliver the Tenant Audited Reporting Financials and Tenant Reporting Financials
continues and is not cured within an additional ten (10) days after the
aforesaid seventy-five (75) day period), the audited (A) consolidated
balance sheet, statement of operations, statement of stockholders’ equity and
statement of cash flows and all other related schedules for the fiscal period
then ended of Tenant and its consolidated subsidiaries (the “Tenant Audited
Reporting Financials” and together with the Tenant Unaudited Reporting
Financials, the “Tenant Reporting Financials”), (B)  such other
financial information reasonably requested by Landlord to the extent required
for Spirit to satisfy its filing obligations under the rules and
regulations of the SEC; and (C) income and expense statements for the
business at each Property Location (such information to be subject to the
confidentiality and non-disclosure provisions set forth in Section 31.17(g)).

 

(c)           So long as (1) the
provisions of Section 16.01(j) shall be in effect and (2) the
purchase price paid by Spirit in respect of the Property Locations leased to
Tenant hereunder on any measurement date and the Property Locations under the Other Lease on such measurement date, on an
aggregate basis, continues to exceed ten percent (10%) but is less than twenty
percent (20%) of Spirit’s total assets as of the date of its most recent
audited balance sheet (including any assets acquired subsequent to the date of
that balance sheet if the acquisitions of those assets were reported in a
report on Form 8-K) then, Tenant shall deliver to Landlord such financial
statements and information required for Spirit to comply with all reporting
requirements of the SEC.

 

56

 

(d)           At
such time as the provisions of Section 16.01(j) are no longer in
effect, and at all times thereafter during the Term of this Lease, Tenant shall
deliver to Landlord the following financial statements:

 

(i)            within
forty-five (45) days after the end of each fiscal quarter of Tenant (provided,
however, that Tenant shall not be in Default under this Lease for failure to
deliver the following items unless such failure to deliver same continues and
is not cured within an additional fifteen (15) days after the aforesaid
forty-five (45) day period), the (A) Tenant Unaudited Reporting
Financials; (B) such other financial information reasonably requested by
Landlord to the extent required for Landlord to satisfy its filing obligations
under the rules and regulations of the SEC; and (C) income and
expense statements for the business at each of the Property Locations (such
information to be subject to the confidentiality and non-disclosure provisions
set forth in Section 31.17(g)); and

 

(ii)           within
seventy-five (75) days after the end of each fiscal year of Tenant (provided,
however, that so long as Tenant delivers to Landlord “draft” statements within
the aforesaid seventy-five (75) day period, Tenant shall not be in Default
under this Lease for failure to deliver the following items unless such failure
to deliver same continues and is not cured within an additional ten (10) days
after the aforesaid seventy-five (75) day period), the (A) Tenant Audited
Reporting Financials; (B) such other financial information reasonably requested
by Landlord to the extent required for Landlord to satisfy its filing
obligations under the rules and regulations of the SEC; and (C) income
and expense statements for the business at each of the Property Locations (such
information to be subject to the confidentiality and non-disclosure provisions
set forth in Section 31.17(g)).

 

(e)           All
financial statements to be provided hereunder shall be prepared in accordance
with GAAP, and the Holding Reporting Financials and the Tenant Reporting
Financials will be prepared in accordance with Regulation S-X promulgated under
the Securities Exchange Act of 1934, as amended (the “Exchange Act”);
provided that any unaudited Reporting Financials will not be reviewed by
independent public accountants. In the event of changes after the Effective
Date in the rules and regulations of the SEC applicable to Tenant’s
obligations hereunder, Landlord will reasonably cooperate with Tenant to the
extent Tenant wishes to appeal or otherwise seek exemptive relief from such requirements
from the SEC, subject to Landlord’s obligation to timely file the applicable
financial information. To the extent such changes are the sole cause of an
increase in the cost of compliance hereunder and under Section 31.17(e) of
the Other Lease of more than Two Hundred Fifty Thousand Dollars ($250,000), in
the aggregate on an annual basis, such additional reporting costs in excess of
Two Hundred Fifty Thousand Dollars ($250,000) on an annual basis (adjusted
annually for the increase in the CPI) shall be paid by Landlord.

 

(f)            At
such time as (1) the provisions of Section 16.01(j) shall be
in effect and (2) the purchase price paid by Spirit in respect of the
Property Locations leased to Tenant hereunder on any measurement date and the
Property Locations under the Other Lease on such measurement date, on an
aggregate basis, no longer exceeds twenty percent (20%) of Spirit’s total
assets as of the date of its most recent audited balance sheet (including any
assets acquired subsequent to the date of that balance sheet if the
acquisitions of those assets were reported in a report on Form 8-K) then,
the Holding Reporting Financials shall no longer be required to

 

57

 

comply with Regulation
S-X and Spirit shall no longer include such Reporting Financials as part of
its SEC filings. At such time as (i) the provisions of Section 16.01(j)
are no longer in effect and (ii) the purchase price paid by Spirit in
respect of the Property Locations leased to Tenant hereunder on any measurement
date, on an aggregate basis, no longer exceeds twenty percent (20%) of Spirit’s
total assets as of the date of its most recent audited balance sheet (including
any assets acquired subsequent to the date of that balance sheet if the acquisitions
of those assets were reported in a report on Form 8-K) then, the Tenant
Reporting Financials shall no longer be required to comply with Regulation S-X
and Spirit shall no longer include such Reporting Financials as part of
its SEC filings.

 

(g)           Landlord
agrees to treat as confidential, and to not disclose without Tenant’s written
consent, all income and expense statements for the business at each Property
Location and any other information specific to a Property Location including,
but not limited to, the reports generated by Tenant under Section 31.17(j)
(collectively, the “Confidential Information”); provided, however, that
Confidential Information does not include information which (i) is already
known to Landlord prior to receipt as evidenced by prior documentation thereof
or has been independently developed by Landlord on a non-confidential basis; (ii) is
or becomes generally available to the public other than as a result of an
improper disclosure by Landlord or its representatives; (iii) becomes
available to Landlord on a non-confidential basis from a source other than
Tenant or any of its representatives, provided that such source is not, to
Landlord’s knowledge, bound by a confidentiality agreement with or other
contractual, legal or fiduciary obligation of confidentiality to Tenant with
respect to such information; or (iv) is disclosed pursuant to a
requirement of a court, administrative agency or other regulatory or
governmental body or is disclosed pursuant to applicable law, rule or
regulation. Notwithstanding the foregoing, Landlord may, without the written
consent of Tenant, disclose any Confidential Information solely to a Mortgagee
or trustee in connection with a Securitization or a rating agency involved with
respect to such Securitization (collectively, the “Disclosure Parties”)
and the Disclosure Parties may further disclose the Confidential
Information solely to B-piece buyers in connection with the Securitization or
an institutional investor that typically invests in Securitizations of this
type and size (“Other Parties”) to the extent the Disclosure Parties customarily
disclose the same to the Other Parties in connection with the Securitization
and to the extent requested by the Other Parties; provided that (A) the
Disclosure Parties and the Other Parties are advised that the Confidential
Information is confidential, (B) the Confidential Information may not
be placed in any prospectus, or other Securities offering material or other
written materials by Landlord, or any Mortgagee, trustee or rating agency or
any Affiliated Party, and (C) the Disclosure Parties and the Other Parties
(other than the rating agencies which are not required to execute a
Confidentiality Agreement but may only disclose information to parties
that have executed a Confidentiality Agreement), execute a confidentiality
agreement substantially in the form attached hereto as Schedule 31.17(g),
or such other form as reasonably agreed upon by Tenant, Landlord, the
Disclosure Parties and/or the Other Parties (the “Confidentiality Agreement”).
Notwithstanding anything to the contrary contained in this Section, (a) in
no event shall any Confidential Information be disclosed to any retailers, and (b) Landlord
and Tenant understand and agree that the Disclosure Parties may disclose
aggregate, portfolio level financial information regarding Tenant and the
Properties as a whole.

 

(h)           All
financial statements to be provided hereunder shall be certified by the chief
financial officer or administrative member of Tenant, which certification shall
be in the

 

58

 

form of Schedule 31.17(h) attached
hereto and shall state that such financial statements (i) are true,
complete and correct in all material respects, (ii) fairly present, in all
material respects, the financial condition of Tenant as of the date of such
reports, and (iii) satisfy the requirements set forth in Section 31.17.
If Tenant discovers that its financial statements contain a misstatement or an
omission in any material respect, it shall promptly notify Landlord of same and
take such actions as are reasonably necessary to correct such financial
statements; provided, however, in no event shall Tenant willfully and
intentionally misstate its financial statements. In no event shall Tenant have
any liability to Landlord or its affiliates in respect of any breach of the
foregoing certification caused by Tenant’s negligence or gross negligence or,
except as set forth in Section 16.01 and Section 16.02,
for failure to perform its obligations under this Section 31.17.
Landlord’s sole rights and remedies for a breach of this Section 31.17
shall be limited to those remedies that are available to Landlord as set forth
in Section 16.02 of this Lease.

 

(i)            Tenant
agrees that the Holding Audited Reporting Financials and the Tenant Audited
Reporting Financials shall be audited by, and the Holding Unaudited Reporting
Financials and the Tenant Unaudited Reporting Financials shall be reviewed by,
a nationally recognized accounting firm. Furthermore, Tenant shall use
commercially reasonable efforts to cause its accountants to deliver their
consent in a timely manner to the inclusion of their audit opinion in any
regulatory reports filed as part of Spirit’s SEC reporting obligation;
provided, however, that such accountants’ failure or refusal to consent shall
not be a Default under this Lease.

 

(j)            Tenant
agrees, as an accommodation to Landlord and for strictly informational
purposes, to prepare and deliver to Landlord a report of each Property Location
detailing the (i) sales per square foot at each individual Property
Location, (ii) occupancy costs of each Property Location, and (iii) capital
expenditures of each Property Location, within forty-five (45) days after the
end of each fiscal quarter and ninety (90) days after the close of each fiscal
year of Tenant, as applicable (such information to be subject to the
confidentiality and non-disclosure provisions set forth in Section 31.17(g));
provided, however, that (1) the inaccuracy of any reports, (2) Tenant’s
failure to timely deliver such reports, and/or (3) any deficiency in such
reports or any other failure to comply with this Section, shall not constitute
a Default under this Lease.

 

31.18       State-Specific-Provisions. The
provisions and/or remedies which are set forth on the attached Exhibit H
shall be deemed a part of and included within the terms and conditions of
this Lease.

 

31.19       Counterparts. This Lease may be
executed in one or more counterparts, each of which shall be deemed an
original.

 

31.20       Mortgagee Consent.
With respect to any and all provisions of this Lease requiring Landlord’s
consent, the refusal or failure of Landlord’s Mortgagee to grant consent (to
the extent required and applicable) shall be a reasonable basis for Landlord to
withhold its consent.

 

31.21       Waiver of Jury Trial and Certain Damages.
Landlord and Tenant hereby knowingly, voluntarily and intentionally waive the
right either may have to a trial by jury with

 

59

 

respect to any and
all issues presented in any action, proceeding, claim or counterclaim brought
by either of the parties hereto against the other or its successors with
respect to any matter arising out of or in connection with this Lease, the
relationship of Landlord and Tenant, Tenant’s use or occupancy of the Premises,
and/or any claim for injury or damage, or any emergency or statutory remedy. This
waiver by the parties hereto of any right either may have to a trial by
jury has been negotiated and is an essential aspect of their bargain. Furthermore,
Tenant and Landlord hereby knowingly, voluntarily and intentionally waive the
right each may have to seek punitive, consequential, special and indirect
damages from the other or any of its successors and assigns with respect to any
and all issues presented in any action, proceeding, claim or counterclaim
brought with respect to any matter arising out of or in connection with this
Lease or any document contemplated herein or related hereto. The waiver by
Tenant and Landlord of any right each may have to seek punitive,
consequential, special and indirect damages has been negotiated by the parties
hereto and is an essential aspect of their bargain.

 

31.22       Securitizations.
As a material inducement to Landlord’s willingness to enter into this Lease,
Tenant hereby acknowledges and agrees that Landlord may, in connection with a
Securitization from time to time and at any time (a) subject to Section 31.17(g),
advertise, issue press releases, send direct mail or otherwise disclose
information in this Lease for marketing purposes; and (b) (i) act or
permit another Person to act as sponsor, settler, transferor or depositor of,
or a holder of interests in, one or more Persons or other arrangements formed
pursuant to a trust agreement, indenture, pooling agreement, participation
agreement, sale and servicing agreement, limited liability company agreement,
partnership agreement, articles of incorporation or similar agreement or
document; and (ii) permit one or more of such Persons or arrangements to
offer and sell stock, certificates, bonds, notes, other evidences of
indebtedness or securities that are directly or indirectly secured,
collateralized or otherwise backed by or represent a direct or indirect
interest in whole or in part in any of the assets, rights or properties
described in Section 12.04 of this Lease, in one or more Persons or
arrangements holding such assets, rights or properties, or any of them
(collectively, the “Securities”), whether any such Securities are
privately or publicly offered and sold, or rated or unrated (any combination of
which actions and transactions described in both clauses (i) and (ii) in
this paragraph, whether proposed or completed, are referred to in this Lease as
a “Securitization”). Tenant shall cooperate fully with Landlord and any
Affected Party (defined below) with respect to all reasonable requests and due
diligence procedures and to use reasonable efforts to facilitate such
Securitization, including, without limitation, but subject to Section 31.17(g),
providing for inclusion in any prospectus or other Securities offering material
such documents, financial and other data, and other information and materials
which would customarily be required with respect to Tenant by a purchaser,
transferee, assignee, servicer, participant, investor or rating agency involved
with respect to such Securitization. For purposes of this Section 31.22,
(1) “Affected Party” means
each direct or indirect participant or investor in a proposed or completed
Securitization, including, without limitation, any prospective owner, any
rating agency or any party to any agreement executed in connection with the
Securitization, and (2) Landlord shall reimburse the reasonable costs and
expenses incurred by Tenant in connection with its obligations under this Section 31.22,
provided that such costs and expenses are in excess of the costs and expenses
Tenant may incur in connection with the performance of its obligations
under this Lease.

 

31.23       No Merger.
There shall be no merger of this Lease nor of the leasehold estate created by
this Lease with the fee estate in or ownership of any of the Premises by reason
of the

 

60

 

fact that the same
person, corporation, firm or other entity may acquire or hold or own,
directly or indirectly, (a) this Lease or the leasehold estate created by
this Lease or any interest in this Lease or in such leasehold estate, and (b) the
fee estate or ownership of any of the Premises or any interest in such fee
estate or ownership. No such merger shall occur unless and until all persons,
corporations, firms and other entities having any interest in (i) this
Lease or the leasehold estate created by this Lease, and (ii) the fee
estate in or ownership of the Premises or any part thereof sought to be
merged shall join in a written instrument effecting such merger and shall duly
record the same.

 

31.24       Fair Market Rent.
With respect to the determination of the initial Base Rent for an Extension
Period, if the parties are unable to agree upon an initial Base Rent that,
taking into account the length of the Extension Period and the adjustments to
the Base Rent during the Extension Period anticipated under Section 2.01,
results in fair market rent for the Extension Period (such initial Base Rent,
the “FMV Base Rent”), then an independent MAI Appraiser (defined below)
selected by agreement of the parties within ten (10) days of said request
shall prepare a determination of the FMV Base Rent. In making such
determination, the appraiser shall consider rentals received in the general
market area in which the Property Location is located for similar buildings of
comparable characteristics, including, but not limited to, comparable lease
terms, age, condition and classification. If within ten (10) business days
after being notified of the results of such appraisal, Landlord and/or Tenant
elects to reject that determination, then each of the parties shall name an
additional independent MAI Appraiser within ten (10) days after such
rejection. In the event the appraisers so named together with the originally
named appraiser are unable to agree on an FMV Base Rent then the determination
shall be the amount agreed upon by the majority of said appraisers and reported
to the parties within ten (10) days thereafter. In the event the parties
are unable to select the appraiser in the first instance, each shall select one
appraiser within ten (10) days after the period for having agreed, and
those two appraisers shall select a third appraiser (in absence of agreement as
to the selection of said third independent appraiser, such selection shall be
made by a mediation process reasonably agreed upon by the parties or in absence
of the same, by a court of competent jurisdiction). The costs and expenses of
such appraisal, including the fees of the appraiser or appraisers, shall be
divided equally between Tenant and Landlord. The determination of the majority
of the appraisers as to the FMV Base Rent shall be conclusive upon the parties
and judgment upon the same may be entered in any court having jurisdiction
thereof. For purposes of this Section 31.24, “MAI Appraisers”
shall mean firms or individuals, each of whom shall have not less than ten (10) years
experience in appraising retail commercial real estate, preferably in areas
where a majority of the Property Locations are situated. The determination of
the FMV Base Rent hereunder shall be made on a Property Location-by-Property
Location basis, and the initial Base Rent for such Extension Period shall
reflect the FMV Base Rents as determined hereunder for the Property Locations
with respect to which the related Extension Option was exercised. For purposes
of this Section 31.24, “initial Base Rent” shall mean the
annual Base Rent in effect during the Extension Period until the first
Adjustment Date during such Extension Period.

 

61

 

ARTICLE 32.

INTENTIONALLY DELETED

 

[SIGNATURES
CONTAINED ON FOLLOWING PAGE]

 

62

 

IN WITNESS
WHEREOF, the parties hereto have caused this Lease to be executed as of the
date first written above.

 

 

	
  LANDLORD:

  	
  TENANT:

  
	
   

  	
   

  
	
  SPIRIT SPE PORTFOLIO
  2006-3, LLC, a

  Delaware limited liability company

  	
  PAMIDA STORES OPERATING CO., LLC,

  a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Michael T. Bennett

  	
   

  	
  By:

  	
  /s/ Peter G. Vandenhouten

  	
   

  
	
  Name: Michael T. Bennett

  	
  Name:

  	
  Peter G. Vandenhouten

  	
   

  
	
  Its: Senior Vice President

  	
  Its:

  	
  Secretary

  	
   

  
							

 

63

 

EXHIBIT A-1

 

LIST OF FEE PROPERTIES

 

	
  Store #

  	
   

  	
  Concept

  	
   

  	
  Address

  	
   

  	
  City

  	
   

  	
  ST

  	
   

  	
  Zip

  
	
  3007

  	
   

  	
  Pamida

  	
   

  	
  1520 West 9th St

  	
   

  	
  Mt Carmel

  	
   

  	
  IL

  	
   

  	
  62863

  
	
  3008

  	
   

  	
  Pamida

  	
   

  	
  226 E. Lincoln Ave

  	
   

  	
  Fergus Falls

  	
   

  	
  MN

  	
   

  	
  56537

  
	
  3015

  	
   

  	
  Pamida

  	
   

  	
  825 Valley St

  	
   

  	
  Minerva

  	
   

  	
  OH

  	
   

  	
  44657

  
	
  3017

  	
   

  	
  Pamida

  	
   

  	
  750 South Congress Blvd

  	
   

  	
  Smithville

  	
   

  	
  TN

  	
   

  	
  37166

  
	
  3022

  	
   

  	
  Pamida

  	
   

  	
  671 Wolford Ave

  	
   

  	
  Liberty

  	
   

  	
  KY

  	
   

  	
  42539

  
	
  3023

  	
   

  	
  Pamida

  	
   

  	
  815 East Lakeshore Dr

  	
   

  	
  Manistique

  	
   

  	
  MI

  	
   

  	
  49854

  
	
  3028

  	
   

  	
  Pamida

  	
   

  	
  1001 East Laural Ave

  	
   

  	
  Havana

  	
   

  	
  IL

  	
   

  	
  62644

  
	
  3033

  	
   

  	
  Pamida

  	
   

  	
  378 Lewisville Rd

  	
   

  	
  Woodsfield

  	
   

  	
  OH

  	
   

  	
  43793

  
	
  3035

  	
   

  	
  Pamida

  	
   

  	
  140 Bull Run Rd

  	
   

  	
  Munfordville

  	
   

  	
  KY

  	
   

  	
  42765

  
	
  3037

  	
   

  	
  Pamida

  	
   

  	
  2702 Central Ave

  	
   

  	
  Estherville

  	
   

  	
  IA

  	
   

  	
  51334

  
	
  3041

  	
   

  	
  Pamida

  	
   

  	
  540 Jenner Dr

  	
   

  	
  Allegan

  	
   

  	
  MI

  	
   

  	
  49010

  
	
  3046

  	
   

  	
  Pamida

  	
   

  	
  802 N. Main St

  	
   

  	
  Kewaunee

  	
   

  	
  WI

  	
   

  	
  54216

  
	
  3056

  	
   

  	
  Pamida

  	
   

  	
  800 S. Washington Ave

  	
   

  	
  Madison

  	
   

  	
  SD

  	
   

  	
  57042

  
	
  3057

  	
   

  	
  Pamida

  	
   

  	
  1678 Cooke Highway

  	
   

  	
  Livingston

  	
   

  	
  TN

  	
   

  	
  38570

  
	
  3061

  	
   

  	
  Pamida

  	
   

  	
  91 West Pine Lake Dr

  	
   

  	
  Newaygo

  	
   

  	
  MI

  	
   

  	
  49337

  
	
  3074

  	
   

  	
  Pamida

  	
   

  	
  11250 North Mission Rd

  	
   

  	
  Clare

  	
   

  	
  MI

  	
   

  	
  48617

  
	
  3089

  	
   

  	
  Pamida

  	
   

  	
  1701 East Washington St

  	
   

  	
  Washington

  	
   

  	
  IA

  	
   

  	
  52353

  
	
  3096

  	
   

  	
  Pamida

  	
   

  	
  115 East Chapman

  	
   

  	
  Ely

  	
   

  	
  MN

  	
   

  	
  55731

  
	
  3101

  	
   

  	
  Pamida

  	
   

  	
  126 Charles St

  	
   

  	
  Oconto

  	
   

  	
  WI

  	
   

  	
  54153

  

 

A-1-1

 

	
  Store #

  	
   

  	
  Concept

  	
   

  	
  Address

  	
   

  	
  City

  	
   

  	
  ST

  	
   

  	
  Zip

  
	
  3106

  	
   

  	
  Pamida

  	
   

  	
  314 Sturgis Rd

  	
   

  	
  Marion

  	
   

  	
  KY

  	
   

  	
  42064

  
	
  3107

  	
   

  	
  Pamida

  	
   

  	
  50 Jernigan Dr

  	
   

  	
  Somerville

  	
   

  	
  TN

  	
   

  	
  38068

  
	
  3116

  	
   

  	
  Pamida

  	
   

  	
  4502 North State Road 61

  	
   

  	
  Petersburg

  	
   

  	
  IN

  	
   

  	
  47567

  
	
  3117

  	
   

  	
  Pamida

  	
   

  	
  23l South Highway 50

  	
   

  	
  Loogootee

  	
   

  	
  IN

  	
   

  	
  47553

  
	
  3120

  	
   

  	
  Pamida

  	
   

  	
  Highway 231, RR 6

  	
   

  	
  Bloomfield

  	
   

  	
  IN

  	
   

  	
  47424

  
	
  3122

  	
   

  	
  Pamida

  	
   

  	
  605 Highway 10 East

  	
   

  	
  Detroit Lakes

  	
   

  	
  MN

  	
   

  	
  56501

  
	
  3126

  	
   

  	
  Pamida

  	
   

  	
  2100 East Cedar

  	
   

  	
  Rawlins

  	
   

  	
  WY

  	
   

  	
  82301

  
	
  3129

  	
   

  	
  Pamida

  	
   

  	
  1202 4th Ave South

  	
   

  	
  Wahpeton

  	
   

  	
  ND

  	
   

  	
  58075

  
	
  3135

  	
   

  	
  Pamida

  	
   

  	
  56419 Pokagon St

  	
   

  	
  Dowagiac

  	
   

  	
  MI

  	
   

  	
  49047

  
	
  3137

  	
   

  	
  Pamida

  	
   

  	
  2278 North Comfort Dr

  	
   

  	
  Hart

  	
   

  	
  MI

  	
   

  	
  49420

  
	
  3146

  	
   

  	
  Pamida

  	
   

  	
  805 Teke Burton Drive

  	
   

  	
  Mitchell

  	
   

  	
  IN

  	
   

  	
  47446

  
	
  3151

  	
   

  	
  Pamida

  	
   

  	
  1768 Highway 100

  	
   

  	
  Centerville

  	
   

  	
  TN

  	
   

  	
  37033

  
	
  3153

  	
   

  	
  Pamida

  	
   

  	
  710 Country Road 21 South

  	
   

  	
  Glenwood

  	
   

  	
  MN

  	
   

  	
  56334

  
	
  3158

  	
   

  	
  Pamida

  	
   

  	
  2015 South Defiance St

  	
   

  	
  Archbold

  	
   

  	
  OH

  	
   

  	
  43502

  
	
  3160

  	
   

  	
  Pamida

  	
   

  	
  1201 12th Ave SE

  	
   

  	
  Dyersville

  	
   

  	
  IA

  	
   

  	
  52040

  
	
  3168

  	
   

  	
  Pamida

  	
   

  	
  1625 E. Main St

  	
   

  	
  Montpelier

  	
   

  	
  OH

  	
   

  	
  43543

  
	
  3169

  	
   

  	
  Pamida

  	
   

  	
  1625 E. Blaschko Ave

  	
   

  	
  Arcadia

  	
   

  	
  WI

  	
   

  	
  54612

  
	
  3178

  	
   

  	
  Pamida

  	
   

  	
  1255 West Main St

  	
   

  	
  Lander

  	
   

  	
  WY

  	
   

  	
  82520

  
	
  3185

  	
   

  	
  Pamida

  	
   

  	
  819 11th Ave SW

  	
   

  	
  Waukon

  	
   

  	
  IA

  	
   

  	
  52172

  
	
  3189

  	
   

  	
  Pamida

  	
   

  	
  1305 141st St

  	
   

  	
  Perry

  	
   

  	
  IA

  	
   

  	
  50220

  
	
  3190

  	
   

  	
  Pamida

  	
   

  	
  804 Highway 2 West

  	
   

  	
  Glasgow

  	
   

  	
  MT

  	
   

  	
  59230

  
	
  3194

  	
   

  	
  Pamida

  	
   

  	
  1800 Lakeshore Drive East

  	
   

  	
  Ashland

  	
   

  	
  WI

  	
   

  	
  54806

  
	
  3195

  	
   

  	
  Pamida

  	
   

  	
  1625 US Highway 61

  	
   

  	
  Lancaster

  	
   

  	
  WI

  	
   

  	
  53813

  

 

A-1-2

 

	
  Store #

  	
   

  	
  Concept

  	
   

  	
  Address

  	
   

  	
  City

  	
   

  	
  ST

  	
   

  	
  Zip

  
	
  3215

  	
   

  	
  Pamida

  	
   

  	
  657 West Main Connector

  	
   

  	
  Hodgenville

  	
   

  	
  KY

  	
   

  	
  42748

  
	
  3219

  	
   

  	
  Pamida

  	
   

  	
  102 Parkway Lane

  	
   

  	
  Morgantown

  	
   

  	
  KY

  	
   

  	
  42261

  
	
  3220

  	
   

  	
  Pamida

  	
   

  	
  291 S. Main St

  	
   

  	
  Clintonville

  	
   

  	
  WI

  	
   

  	
  54929

  
	
  3223

  	
   

  	
  Pamida

  	
   

  	
  117 1st Ave West

  	
   

  	
  Plentywood

  	
   

  	
  MT

  	
   

  	
  59257

  
	
  3224

  	
   

  	
  Pamida

  	
   

  	
  1138 Old Gallatin Rd

  	
   

  	
  Scottsville

  	
   

  	
  KY

  	
   

  	
  42164

  
	
  3226

  	
   

  	
  Pamida

  	
   

  	
  1225 South Hamilton St

  	
   

  	
  Sullivan

  	
   

  	
  IL

  	
   

  	
  61951

  
	
  3227

  	
   

  	
  Pamida

  	
   

  	
  1215 East Main St

  	
   

  	
  Attica

  	
   

  	
  IN

  	
   

  	
  47918

  
	
  3229

  	
   

  	
  Pamida

  	
   

  	
  200 West Burnside Rd

  	
   

  	
  Monticello

  	
   

  	
  IL

  	
   

  	
  61856

  
	
  3230

  	
   

  	
  Pamida

  	
   

  	
  840 North US Highway 41/RR 3

  	
   

  	
  Rockville

  	
   

  	
  IN

  	
   

  	
  47872

  
	
  3241

  	
   

  	
  Pamida

  	
   

  	
  509 W. Cherry & Princeton Streets

  	
   

  	
  Vermillion

  	
   

  	
  SD

  	
   

  	
  57069

  
	
  3248

  	
   

  	
  Pamida

  	
   

  	
  2105 Lazelle St

  	
   

  	
  Sturgis

  	
   

  	
  SD

  	
   

  	
  57785

  
	
  3252

  	
   

  	
  Pamida

  	
   

  	
  1005 US Highway 14A

  	
   

  	
  Powell

  	
   

  	
  WY

  	
   

  	
  82435

  
	
  3255

  	
   

  	
  Pamida

  	
   

  	
  1300 Jefferson St

  	
   

  	
  Greenfield

  	
   

  	
  OH

  	
   

  	
  45123

  
	
  3256

  	
   

  	
  Pamida

  	
   

  	
  700 Progress Blvd

  	
   

  	
  Tuscola

  	
   

  	
  IL

  	
   

  	
  61953

  
	
  3295

  	
   

  	
  Pamida

  	
   

  	
  1012 Jeffreys Dr

  	
   

  	
  Osceola

  	
   

  	
  IA

  	
   

  	
  50213

  
	
  3298

  	
   

  	
  Pamida

  	
   

  	
  1103 First Street East

  	
   

  	
  Park Rapids

  	
   

  	
  MN

  	
   

  	
  56470

  
	
  3851

  	
   

  	
  Pamida

  	
   

  	
  101 South 25th St

  	
   

  	
  Albany

  	
   

  	
  MO

  	
   

  	
  64402

  
	
  3852

  	
   

  	
  Pamida

  	
   

  	
  1110 South Polk Street

  	
   

  	
  Bethany

  	
   

  	
  MO

  	
   

  	
  64424

  
	
  3856

  	
   

  	
  Pamida

  	
   

  	
  212 N Main St

  	
   

  	
  Gallatin

  	
   

  	
  MO

  	
   

  	
  64640

  
	
  3860

  	
   

  	
  Pamida

  	
   

  	
  Highway 136 East

  	
   

  	
  Memphis

  	
   

  	
  MO

  	
   

  	
  63555

  
	
  3873

  	
   

  	
  Pamida

  	
   

  	
  300 Cross St

  	
   

  	
  Burlington

  	
   

  	
  KS

  	
   

  	
  66839

  
	
  3880

  	
   

  	
  Pamida

  	
   

  	
  1003 Central Ave West

  	
   

  	
  Clarion

  	
   

  	
  IA

  	
   

  	
  50525

  
	
  3889

  	
   

  	
  Pamida

  	
   

  	
  201 North Fillmore St

  	
   

  	
  Mount Ayr

  	
   

  	
  IA

  	
   

  	
  50854

  

 

A-1-3

 

	
  Store #

  	
   

  	
  Concept

  	
   

  	
  Address

  	
   

  	
  City

  	
   

  	
  ST

  	
   

  	
  Zip

  
	
  HQ

  	
   

  	
  Pamida HQ

  	
   

  	
  8800 F St

  	
   

  	
  Omaha

  	
   

  	
  NE

  	
   

  	
  68127

  
	
  66

  	
   

  	
   

  	
   

  	
  Pamida Properties

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

A-1-4

 

EXHIBIT A-2

 

INTENTIONALLY DELETED

 

A-2-1

 

EXHIBIT A-3

 

LEGAL DESCRIPTION OF EACH PARCEL

 

 

A-3-1

 

LEGAL DESCRIPTION

 

A
part of the Southeast Quarter of Section 19, Township 1 South, Range
12 West of the Second P.M., described as follows:

 

From
the intersection of the Northerly right of way line of S.B.I. Route 15,
with the East line of Section 19, measure South 67° 57’ 12” West along
said right of way line a distance of 1104.6’ to an iron pin being the point of
beginning; thence North 22° 02’ 48” West a distance of 88.17 feet to an iron
pin; thence N 8° 54’ 12”“ West a distance of 73.94 feet to an iron pin; thence
North 81° 05’ 48” East a distance of 133.73 feet to an iron pin; thence North
0° 00”‘ East a distance of 562.49 feet to an iron pin; thence North 0° 00” East
a distance of 32 feet to the center of a drainage ditch; thence in a Westerly
direction along the center of said ditch a distance of 400 feet, more or less,
to a point; thence South 8° 54’ 12” East a distance of 50 feet to an iron pin;
thence South 8° 54’ 12” East a distance of 615 feet to an iron pin; thence
North 81° 05’ 48” East a distance of 100 feet to an iron pin; thence South 8°
54’ 12” East a distance of 82 feet to an iron pin; thence South 22° 02’ 48”
East a distance of 96.23 feet to an iron pin; thence North 67° 57’ 12” East a
distance of 70 feet to the point of beginning, all in Wabash County, Illinois;

 

EXCEPT
THEREFROM that portion of the above described tract conveyed to the State of
Illinois for highway purposes on August 9, 1971 by virtue of Deed Record
97, page 47 in the office if the Recorder of Wabash County, Illinois.

 

Together
with a non-exclusive easement for the discharge of surface water created by
Grant of Easement and Restriction Agreement dated November 1, 1998 between
Dayton Hudson Corporation and Lyle Weber, recorded February 16, 1998 in
miscellaneous record 115 at page 843 in the recorder’s office of Wabash
County, Illinois.

 

Tax
Parcel Number: 05-111-19-400-029

 

 

LEGAL DESCRIPTION

 

Lots
1, 2, 3, 4 and 5, in Reserve 65, Original Plat to the City of Fergus Falls,
Minnesota, together with the following described tract of land, to-wit:
Commencing at the southwest corner of said Lot 5, Reserve 65, Original Plat,
thence due South, parallel with the westerly right-of-way line of vacated
Whitford Street, a distance of 144.32 feet; thence South 58 degrees 06 minutes
East, a distance of 34.93 feet; thence due East a distance of 95 feet more or
less to the westerly right-of-way line of vacated Whitford Street; thence due
North along the westerly right-of-way line of vacated Whitford Street, a
distance of 165.23 feet more or less to the southeast corner of said Lot 1,
Reserve 65, Original Plat; thence due West along the south line of said Lots 1
through 5, Reserve 65, Original Plat, a distance of 125 feet to the point of
beginning and there terminating.

 

That
part of dedicated and vacated right-of-way known as Whitford Street from
the north line of Reserve 65, Original Plat, extended to a point 250 feet south
of said north line and being 75 feet in width.

 

Lots
18 and 19, Reserve 64, Original Plat to the City of Fergus Falls, Minnesota.

 

Lots
1, 2, 3, 4, 5, 6, 7 and 8, Block 19, Original Plat to the City of Fergus Falls,
Minnesota, excepting existing street right-of-way over and across that portion
of Lot 1, Block 19, Original Plat to the City of Fergus Falls, Minnesota.

 

Tax
I.D # (R7 1002990210900)

Tax
I.D # (R7 1002990225000)

Tax
I.D # (R7 1002990225001)

 

 

LEGAL DESCRIPTION

 

Tract
4 as depicted on the survey filed on September 15, 2005 in File No. 1,
Pocket 13, Folder 2 as Instrument No. 05-4871, and being more particularly
described as follows:

 

Situated
in the State of Ohio, County of Carroll, City of Minerva, Township of Brown,
and being a part of the Northeast corner of Section 11, Township 16,
Range 6, and being more particularly described as follows:

 

COMMENCING,
at an iron rebar found marking the Northeast corner of the Northeast Quarter of
Section 11, N 85° 38’ 00” W, 135.42 feet to an iron rebar found. Thence,
from said iron rebar, and continuing with said section line, N 85° 38’ 00”
W, 695.04 feet to an iron rebar found. Thence, from said iron rebar found S 47°
35’ 00” W, 488.80 feet to an iron rebar found. Thence, from said iron rebar, S
83° 58’ 34” W, 68.80 feet to an iron rebar found. Thence, from said iron rebar
found, S 20° 59’ 26” E, 92.19 feet to an iron rebar found, said iron rebar also
marks the TRUE PLACE OF BEGINNING, for
the parcel herein described.

 

Thence,
from said iron rebar, N 47° 35’ 00” E, 105.00
feet to an iron rebar found.

 

Thence,
from said iron rebar, N 42° 25’ 00” E, 35.00
feet to an iron rebar found.

 

Thence,
from said iron rebar, N 47° 34’ 57” E, 138.30
feet to an iron rebar found.

 

Thence,
from said iron rebar, S 11° 39’ 25” E, 110.10 feet
to a mag-nail set.

 

Thence,
from said mag-nail set, S 11° 39’ 25” E, 110.01 feet
to a mag-nail set.

 

Thence,
from said mag-nail set, N 78° 14’ 55” W, 151.41 feet
to a mag-nail set.

 

Thence
from said mag-nail set, S 12° 20’ 14” E, passing over the Northeast corner of
block building at 154.13 and at 334.11 feet, going a total distance of 393.89
feet to an iron rebar set.

 

Thence,
from said iron rebar, S 77° 39’ 45” W, 298.44 feet to an iron rebar found.

 

Thence,
from said iron rebar, N 20° 59’ 26” W, 529.92 feet to the TRUE
PLACE OF BEGINNING.

 

Being
a survey of a portion of a parcel conveyed to Pamida, Inc., as described
and recorded in Volume 292, Page 129, as found in the Office of the
Recorder, Carroll County, Ohio.

 

Together
with non-exclusive easement rights created by Declarations of Cross-Easements
and Covenants and Restrictions Affecting Land between Pamida, Inc. and The
Village of Minerva, dated November 16, 1999, filed for record December 16,
1999 and recorded in Volume 292, Page 131 of Carroll County Records.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 6, 2006 as Inst. No. 200600000562 in Book 25, Page 2122.

 

TAX
I.D.:  PART OF 08-01036.000

 

 

LEGAL DESCRIPTION

 

LAND
LYING IN DEKALB COUNTY, TENNESSEE, BEING LOT 1 ON THE FINAL PLAT FOR PAMIDA
DIVISION OF RECORD IN BOOK 1, PAGE 292, REGISTER’S OFFICE FOR DEKALB
COUNTY, TENNESSEE.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 2, 2006 as Document No. 133053 in Book 237, page 610.

 

TAX
I.D.:  073-D-H-07.12

 

 

LEGAL DESCRIPTION

 

The land referred to is situated in the County of
Casey, State of Kentucky, is described as follows:

Being all of Tract One (Lots 10, 11, 12, 15, 16 and
a part of Lots 13 and 14 of previous plat) of the Pamida Inc. Property
Division, to the City of Liberty, Casey County, Kentucky, as described by plat
of Survey Map thereof recorded in Plat Cabinet 1, Slide 626, in the Office of
the Casey County Court Clerk.

Being a part of the property conveyed by
Liberty Economic Development Corporation, a Kentucky Corporation to Pamida
Inc., by Deed dated the 14th day of February, 2000, of record in Deed Book 196,
page 535, in the Office of the Casey County Court Clerk.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 7, 2006 in Deed Book 239, page 660.

 

Tax Item No. Part of OL3-02-05D

 

 

LEGAL DESCRIPTION

 

The
following property is located in County of Schoolcraft, City of Manistique,
State of Michigan and is described as follows:

 

That
part of Government Lot Two (2), Section Eighteen (18), Township
Forty-one (41) North, Range Fifteen (15) West, more particularly described as
follows: Commencing at the Northwest corner of said Section 18; thence
North 89 degrees 58 minutes 08 minutes East, 1319.73 feet to the West
One-sixteenth corner of said Section 18; thence South 00 degrees 01
minutes 51 seconds West, along the West one-sixteenth line of said Section 18,
1650.61 feet to the point of beginning of the parcel hereby described; thence
South 89 degrees 58 minutes 36 seconds East, along a line that is parallel with
the North line of Government Lot Two, 360.00 feet; thence South 00 degrees 03
minutes 02 seconds East, along a line that is parallel with the West line of
said Government Lot Two 475.00 feet; thence North 89 degrees 58 minutes 36
seconds West, along a line that is parallel with the North line of said
Government Lot Two, 360.00 feet to a point on the West line of said Government
Lot Two; thence North 00 degrees 03 minutes 02 seconds West, along said West
line, a distance of 475.00 feet to said point of beginning (hereinafter below
referred to as “Parcel A”).

 

Together
with non-exclusive easement rights created by Sanitary Sewer Easement as
disclosed by an instrument recorded in Liber 153, page 253.

 

Together
with non-exclusive easement rights created by Easement Agreement and Use
Restrictions as disclosed by instrument recorded in Liber 153, page 258.
First Amendment to Easement Agreement and Use Restrictions recorded in Liber
154, page 203.

 

Tax
I.D.:  77-051-600-040-50

 

 

LEGAL DESCRIPTION

 

LOT
3 OF HAVANA BUSINESS PARK ACCORDING TO PLAT FILED FOR RECORD IN THE RECORDER’S
OFFICE OF MASON COUNTY, ILLINOIS ON JUNE 19, 2000 AND RECORDED IN BOOK 9
OF PLATS ON PAGE 158; SITUATED IN THE COUNTY OF MASON, IN THE STATE OF
ILLINOIS.

 

TAX
PARCEL NUMBER:  005-366002

 

 

LEGAL DESCRIPTION

 

SITUATED
IN THE STATE OF OHIO, COUNTY OF MONROE, TOWNSHIP OF CENTER AND BEING PART OF
OUTLOT 177 AND PART OF OUTLOT 178 OF THE VILLAGE OF WOODSFIELD, AS SHOWN
ON TAX MAP SEC. “X”, IN SECTION 36, RANGE 5 WEST, TOWNSHIP 4 NORTH OF “THE
OLD SEVEN RANGES SURVEY” AND BEING PART OF PARCELS NOW OR FORMERLY OWNED
BY GARY AND NANCY RUBLE AS RECORDED IN OFFICIAL RECORD VOLUME 1, PAGE 161
AND VOLUME 8, PAGE 157 OF THE MONROE COUNTY RECORDS OF DEEDS AND BEING
FURTHER DESCRIBED AS FOLLOWS:

 

COMMENCING
FOR REFERENCE AT A 1/2” BAR FOUND AT THE NORTHEAST CORNER OF SAID OUT LOT 177
WHICH IS THE NORTHWEST CORNER OF LOT 12 OF REISBECK’S ADDITION (PLAT BOOK 3, PAGE R-2);
THENCE S 00o 54’ 46” W (BASIS OF BEARINGS FROM SAID RUBLE DEED, VOLUME 8, PAGE 157)
ALONG THE EAST LINE OF SAID OUTLOT 177 WHICH IS THE WEST LINE OF SAID REISBECK’S
ADDITION, A DISTANCE OF 259.90 FEET TO A 1/2” BAR FOUND AT THE TRUE PLACE OF
BEGINNING OF THE PARCEL HEREIN DESCRIBED):

 

1.
THENCE S 00o 56’ 44” W ALONG THE EAST LINE OF SAIDOUT LOT 178 WHICH IS THE WEST
LINE OF SAID REISBECK’S ADDITION, A DISTANCE OF 171.74 FEET TO A 5/8” BAR
FOUND;

 

2.
THENCE S 12o 13’ 21” W ALONG THE WEST LINE OF A PARCEL NOW OR FORMERLY OWNED BY
REISBECK’S FOOD MARKET (DEED VOLUME 167, PAGE 1002) A DISTANCE OF 35.08
FEET TO A 5/8” REBAR SET;

 

3.
THENCE N 87o 32’ 57” W ALONG THE NORTH LINE OF A PARCEL NOW OR FORMERLY OWNED
BY ATLANTIC FINANCIAL GROUP, LTD (O.R. VOLUME 52, PAGE 695) AND ITS
EASTERLY PROJECTION, A DISTANCE OF 353.40 FEET TO A 5/8” BAR FOUND;

 

4.
THENCE S 02o 28’ 47” W ALONG THE WEST LINE OF SAID ATLANTIC FINANCIAL GROUP LTD
PARCEL, A DISTANCE OF 210.110 FEET TO A 5/8” BAR FOUND;

 

5.
THENCE N 89o 16’ 52” W ALONG THE SOUTH LINE OF SAID RUBLE PARCEL (O.R. VOLUME
8, PAGE 157), A DISTANCE OF 72.08 FEET TO A 5/8” REBAR SET;

 

6.
THENCE S 11o 45’ 42” W ALONG THE EAST LINE OF SAID RUBLE PARCEL (O.R. VOLUME 8,
PAGE 157), A DISTANCE OF 93.59 FEET TO A 1/2” BAR FOUND;

 

7.
THENCE S 85o 24’ 42” W ALONG THE SOUTH LINE OF SAID RUBLE PARCEL (O.R. VOLUME
8, PAGE 157), A DISTANCE OF 56.94 FEET;

 

8.
THENCE N 66o 36’ 14” W ALONG THE SOUTH LINE OF SAID RUBLE PARCEL (O.R. VOLUME
8, PAGE 157), A DISTANCE OF 74.95 FEET TO A 1/2” BAR FOUND;

 

9.
THENCE N 06o 32’ 09” E ALONG THE WEST LINE OF SAID RUBLE PARCEL (O.R.VOLUME 8, PAGE 157),
A DISTANCE OF 123.49 FEET TO A 1/2” BAR FOUND;

 

10.
THENCE N 83o 29’ 38” W ALONG THE SOUTH LINE OF SAID RUBLE PARCEL (O.R. VOLUME
8, PAGE 157), A DISTANCE OF 801.88 FEET TO A 1/2” BAR FOUND;

 

11.
THENCE N 00o 49’ 50” E ALONG THE WEST LINE OF SAID RUBLE PARCEL (O.R. VOLUME 8,

 

 

PAGE 157),
A DISTANCE OF 173.88 FEET TO A 1/2” BAR FOUND;

 

12.
THENCE N 77o 30’ 03” E ALONG THE NORTHERLY LINE OF SAID RUBLE PARCEL (O.R.
VOLUME 8, PAGE 157), A DISTANCE OF 198.77 FEET TO A 5/8” REBAR SET;

 

13.
THENCE N 15o 16’ 54” E ALONG THE WESTERLY LINE OF SAID RUBLE PARCEL (O.R.
VOLUME 8, PAGE 157), A DISTANCE OF 392.11 FEET TO A 1/2” BAR FOUND;

 

14.
THENCE S 69o 08’ 28” E ALONG THE NORTHERLY LINE OF SAID RUBLE PARCEL (O.R.
VOLUME 8, PAGE 157), A DISTANCE OF 270.21 FEET TO A 5/8” REBAR SET;

 

15.
THENCE S 14o 36’ 52” W ALONG THE EASTERLY LINE OF SAID RUBLE PARCEL (O.R.
VOLUME 8, PAGE 157), A DISTANCE OF 163.69 FEET TO A 1/2” BAR FOUND;

 

16.
THENCE S 87o 30’ 25” E ALONG THE NORTH LINE OF SAID RUBLE PARCEL (O.R. VOLUME 1,
PAGE 161) WHICH IS THE NORTH LINE OF OUT LOT 178, A DISTANCE OF 144.45
FEET TO THE TRUE PLACE OF BEGINNING AND CONTAINING 5.163 ACRES AS SURVEYED BY
RONALD C. HINTON, S-6270 IN MARCH, 2000.

 

SUBJECT
TO THE RIGHT OF WAY OF STATE ROUTE 78.

 

LESS AND EXCEPT:

 

COMMENCING
FOR REFERENCE AT A 1⁄2” BAR FOUND AT THE NORTHEAST CORNER OF SAID OUT LOT 177
WHICH IS THE NORTHWEST CORNER OF LOT 12 OF REISBECK’S ADDITION (PLAT BOOK 3, PAGE R-2);
THENCE ALONG THE NORTH LINE OF SAID OUTLOT 177, N 89o 49’ 33” W, A DISTANCE OF
359.63 FEET TO A BAR FOUND MARKING A CORNER OF SAID PAMIDA, INC., (DEED
VOLUME 63, PAGE 166); THENCE ALONG A WESTERLY LINE OF SAID PAMIDA, INC.
PARCEL S 15o 18’ 45” W, A DISTANCE OF 392.11 FEET TO A BAR FOUND; THENCE ALONG
A NORTHERLY LINE OF SAID PAMIDA, INC. PARCEL, S 77o 30’ 25” W, A DISTANCE
OF 33.64 FEET TO A 1/2” REBAR SET MARKING THE PRINCIPAL POINT OF BEGINNING OF
THE TRACT TO BE HEREIN DESCRIBED;

 

THENCE
ALONG A NEW DIVISION LINE, S 02o 42’ 49” W, A DISTANCE OF 227.24 FEET TO A

1⁄2”
REBAR SET ON A SOUTHERNLY LINE OF SAID PAMIDA, INC. PARCEL;

 

THENCE
ALONG A SOUTHERNLY LINE OF SAID PAMIDA, INC. PARCEL, N 83o 30’ 21” W, A
DISTANCE OF 153.96 FEET TO A BAR FOUND SET ON THE WEST LINE OF SAID PAMIDA, INC.,
(DEED VOLUME 63, PAGE 166) AND PASSING A BAR FOUND AT 73.00 FEET;

 

THENCE
ALONG THE WEST LINE OF SAID PAMIDA, INC. PARCEL, N 00o 49’ 43” E, A
DISTANCE OF 173.87 FEET TO A 1⁄2” BAR FOUND;

 

THENCE
ALONG THE NORTHERLY LINE OF SAID PAMIDA, INC. PARCEL, N 77o 30’ 25” E, A
DISTANCE OF 165.13 FEET TO THE PRINCIPAL POINT OF BEGINNING AND CONTAINING
0.7214 ACRES OF LAND, MORE OR LESS, SUBJECT TO ANY PRIOR EASEMENTS OF RECORD.

 

TAX
I.D.:  5-050100-9000; 5-050100-9200

 

 

LEGAL DESCRIPTION

 

Beginning
at an existing railroad spike corner monument, at the Western most boundary
line corner of a tract of the lands of Pizza Hut of America (Deed Book 185, page 16),
at the intersection of the Eastern right of way line of National Turnpike
and the Southern right of way line of Stock Pen Road in the Northern section of
the City of Munfordville, Hart County, Kentucky, about 1.23 miles
North-Northeast of the Courthouse in Munfordville, Hart County, Kentucky, said
point of beginning being located Eastwardly 25.00 feet from and at right angles
to the centerline of said National Turnpike and Southwardly 30.00 feet from and
at right angles to the centerline of said Stock Pen Road; thence along the
Northern boundary line of said Pizza Hut of America and the Southern right of
way line and parallel with the centerline of said Stock Pen Road, North 30
degrees 58 minutes 16 seconds East, 199.81 feet to an existing iron pin corner
monument at the Northern most boundary line corner of said Pizza Hut of America
at a Northwestern boundary line corner of a tract of the lands of Hart County
Lodging, Inc., (Deed Book 219, page 59); thence with two (2) lines
along the Northern boundary line of Hart County Lodging, Inc., and
continuing along the Southern right of way line and parallel with the
centerline of said Stock Pen Road, North 21 degrees 10 minutes 02 seconds East,
50.51 feet to an existing iron pin corner monument; thence North 16 degrees 08
minutes 05 seconds East, 60.05 feet to an existing iron pin monument at the
Northern most boundary line corner of said Hart County Lodging, Inc., and
the true point of beginning; thence continuing along the Southern right of way
line and parallel with the centerline of said Stock Pen Road, North 16 degrees
08 minutes 05 seconds East, 184.76 feet to a set iron pin corner monument with
a one inch yellow plastic cap stamped DDS PLS 2062; thence continuing along the
Southern right of way line and parallel with the centerline of said Stock Pen
Road, North 62 degrees 58 minutes 16 seconds East, 344.92 feet to a set iron
pin corner monument with a one inch yellow plastic cap stamped DDS PLS 2062 on
a corner common to the subject tract and at a Southwestern boundary line corner
of a tract of the lands of T & L Investments (Deed Book 200, page 726);
thence along the Southern boundary line of said T & L Investments,
North 85 degrees 17 minutes 07 seconds East, 427.70 feet to an existing iron
pin corner monument on a corner common to the subject tract and at a
Southwestern boundary line corner of said T & L Investments, on the
Northwestern boundary line of a tract of the lands of Richard and Peggy Rucker
(Deed Book 132, page 145); thence along the Northwestern boundary line of
said Rucker, South 05 degrees 08 minutes 19 seconds West, 434.78 feet to an
existing iron pipe corner monument on a corner common to the subject tract and
at a Southwestern boundary line corner of said Rucker at a Northern boundary
line corner of a tract of the lands of Herman and Fanny Singleton (Deed Book
120, page 177), and a Northeastern boundary line corner of a tract of the
lands of Klell and Alma Sturgen (Deed Book 210, page 688); thence along
the Northwestern boundary line of said Sturgen, South 52 degrees 31 minutes 06
seconds West, 255.98 feet to an existing iron pipe corner monument on a corner
common to the subject tract and at a Southeastern boundary line corner of said
Hart County Lodging, Inc., (Deed Book 219, page 59), on the Northern
boundary line of said tract of the lands of said Sturgen; thence with three (3) lines
along the Eastern, Northern and Eastern boundary lines of said Hart County
Lodging, Inc., North 36 degrees 36 minutes 44 seconds West, 415.00 feet to
an existing iron pin corner monument; thence South 53 degrees 21 minutes 50
seconds West, 220.02 feet to an existing iron pin corner monument; thence North
81 degrees 34 minutes 36 seconds West, 120.02 feet to the point of beginning.

 

A
non-exclusive easement onto the above-described property for drainage into the
existing drainage basin near Stock Pen Road currently accepting storm water
from Grantors’ other nearby property and provided, further, that Grantee shall
not undertake any affirmative action that would unreasonably prevent the
natural drainage of water into such existing drainage basin.

 

Being
the same property conveyed to Pamida, Inc., by deed dated the 1st day of
June, 2000, of record in Deed Book 243, page 410, in the Office of the
Hart County Court Clerk.

 

Tax
Parcel # (204-00-02-027-00)

 

 

LEGAL DESCRIPTION

 

Lot 2 in Block 1 of Estherville Industrial Park, an
Addition to the City of Estherville, Emmet County, Iowa, EXCEPT Part of
Lot 2, Block 1 of the Plat of Estherville Industrial Park No. 1,
Estherville, Emmet County, Iowa, described as follows: Beginning at the
Southeast Corner of said Lot 2; thence North 0 degrees 01 minutes 50 seconds
East along the East line of said Lot 2 a distance of 353.10 feet; thence North
89 degrees 36 minutes 50 seconds West along a Northerly line of said Lot 2 a
distance of 250.50 feet; thence South 0 degrees 36 minutes 50 seconds East a
distance of 354.84 feet to the South line of said Lot 2; thence North 89
degrees 59 minutes 45 seconds East along the South line of said Lot 2 a
distance of 245.66 feet to the Point of Beginning; ALSO EXCEPT, part of
Lot 2 in Block 1 of Estherville Industrial Park, Estherville, Iowa, described
as follows: Commencing at the Southeast corner of said Lot 2; thence North 0
degrees 01 minutes 50 seconds East (record bearing) along the East line of said
Lot 2 to the most Easterly Northeast corner of said Lot 2; thence North 89
degrees 36 minutes 50 seconds West 250.50 feet along a Northerly line of said
Lot 2 to the point of beginning; thence North 0 degrees 45 minutes 00 seconds
West 256.85 feet along an Easterly line of said Lot 2 to the most Northerly
Northeast corner of said Lot 2; thence South 90 degrees 00 minutes 00 seconds
West 161.66 feet along the South right-of-way line of Iowa Highway No.9; thence
South 0 degrees 45 minutes 00 seconds East 256.85 feet; thence South 89 degrees
36 minutes 50 seconds East 161.66 feet to the point of beginning, containing
0.95 acres more or less.

 

Together
with a non-exclusive easement created by Grant of Easement recorded May 27,
1997 as instrument number 97-00909 made by Employees Credit Union and Pamida, Inc.

 

Tax
Parcel Number: 05-13-100-008

 

 

LEGAL DESCRIPTION

 

Commencing
at the Southeast corner of Section 29, Town 2 North, Range 13, West, City
of Allegan, Allegan County, Michigan, thence South 89 degrees 50 minutes 55
seconds West (previously recorded as West), on the Section line common to Section 29
and 32, Town 2 North, Range 13 West, 98.11 feet to the West line of Highway
M-40 and the point of beginning of the parcel of land herein described; thence
North 14 degrees 04 minutes 30 seconds East, on said West line, 105.53 feet;
thence North 75 degrees 49 minutes 38 seconds West, 127.83 feet; thence North
22 degrees 26 minutes 37 seconds East, 69.41 feet; thence South 89 degrees 50
minutes 55 seconds West, parallel with said Section line, 400.01 feet;
thence South 00 degrees 50 minutes 55 seconds East, 267.88 feet; thence South
45 degrees 50 minutes 55 seconds East, 144.54 feet; thence North 89 degrees 50
minutes 55 seconds East, parallel with said Section line, 320.08 feet to
the West line of Highway M-40; thence North 14 degrees 26 minutes 43 seconds
East, on said West line, 176.51 feet to the point of beginning.

 

Together
with and subject to a drainage easement described as follows: Commencing at the
Southeast corner of Section 29, Town 2 North, Range 13 West, City of
Allegan, Allegan County, Michigan, thence South 89 degrees 50 minutes 55
seconds West (previously recorded as West), on the Section line common to
Sections 29 and 32, Town 2 North, Range 13 West, 98.11 feet to the West line of
Highway M-40; thence North 14 degrees 04 minutes 30 seconds East, on said West
line, 105.53 feet; thence North 75 degrees 49 minutes 38 seconds West, 127.83
feet; thence North 22 degrees 26 minutes 37 seconds East, 69.41 feet; thence
South 89 degrees 50 minutes 55 seconds West, parallel with said Section line,
400.01 feet; thence South 00 degrees 50 minutes 55 seconds East, 267.88 feet to
the point of beginning of the parcel of land herein described; thence South 44
degrees 09 minutes 05 seconds West, 52.93 feet; thence South 00 degrees 50
minutes 55 seconds East 41.19 feet; thence South 45 degrees 50 minutes 55
seconds East, 31.33 feet; thence North 89 degrees 50 minutes 55 seconds East,
parallel with Section line, 117.49 feet; thence North 45 degrees 50
minutes 55 seconds West, 144.54 feet to the point of beginning.

 

Tax
I.D.:  03-51-300-055-51

Tax
I.D.:  03-51-300-051-30

 

 

LEGAL DESCRIPTION

 

The land referred to is situated in the County of
Kewaunee, Town of Pierce, State of Wisconsin, is described as follows:

Lot 2 of Certified Survey Map, in the Southwest 1/4
of Section 8, Town 23 North, Range 25 East, City of Kewaunee, Kewaunee
County, Wisconsin, recorded in Volume 6 CSM, page 185.

 

Together with non-exclusive easement rights created
by Declaration of Cross-Easements and Covenants and Restrictions Affecting
Land, dated January 27, 2006, and recorded February 6, 2006 as
Document No. 407782 in Volume 504, page 244.

 

Tax I.D.: 31-241-SW8-40.4

 

 

LEGAL DESCRIPTION

 

Parcel
A

 

The
South 212 Feet of Block 1 of County Auditor’s 7th Addition to Madison, Lake
County, South Dakota.

 

Sometimes
described as:

 

The
South 212 Feet of County Auditor’s 7th Addition to Madison, Lake County, South
Dakota.

 

Parcel
B

 

All
of Block 1 of County Auditor’s Seventh Addition to Madison, except the South
212 Feet thereof, and except Lot H-1 thereof, Lake County, South Dakota.

 

Together
with certain easement rights created by Sidewalk Location Easement by and
between Pamida, Inc. and the City of Madison, dated April 23, 2003,
and recorded January 10, 2006 in Book 453, Page 192 in the Office of
the Register of Deeds, Lake County, South Dakota.

 

TAX
I.D.:  21850-00100-00010;
21850-00100-00020

 

 

LEGAL DESCRIPTION

 

BEING
LOT # 1 OF PAMIDA SUBDIVISION, A PLAT OF WHICH IS OF RECORD IN PLAT CABINET A,
SLIDE 157B OF THE OVERTON COUNTY REGISTER’S OFFICE, LIVINGSTON, TENNESSEE, AND
LYING AND BEING IN THE SIXTH CIVIL DISTRICT, OVERTON COLONY, TENNESSEE AND
BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT A 1/2” REBAR SET IN
THE WEST LINE OF LOT #2, BEING LOCATED S 03 DEGREES 32’ 00” W 94.73’ FROM THE
NORTHWEST CORNER OF LOT #2, SAID POINT BEING THE NORTHEAST CORNER OF THE
PROPERTY DESCRIBED HEREIN; THENCE, RUNNING WITH THE WEST LINE OF LOT #2 S 03
DEGREES 32’ 00” W 350.60’ TO A 1/2” REBAR SET IN THE NORTH RIGHT-OF-WAY OF
PAMIDA DRIVE, SAID POINT BEING THE SOUTHWEST CORNER OF LOT #2 AND THE SOUTHEAST
CORNER OF THE PROPERTY DESCRIBED HEREIN; THENCE, LEAVING LOT #2 AND RUNNING
WITH SAID RIGHT-OF-WAY N 86 DEGREES 28’ 02” W 464.17” TO A 1/2” REBAR SET AT
THE COMMON CORNER WITH THE LANDS OF JONES, III ET AL (258/448), SAID POINT
BEING THE SOUTHWEST CORNER OF THE PROPERTY DESCRIBED HEREIN; THENCE, LEAVING
SAID RIGHT-OF-WAY AND RUNNING WITH THE LANDS OF JONES, III ET AL FOR TWO (2) CALLS
AS FOLLOWS: N 03 DEGREES 27’ 06” E 349.95’ TO A 1/2” REBAR SET, SAID POINT
BEING THE NORTHWEST CORNER OF THE PROPERTY DESCRIBED HEREIN; THENCE, S 86
DEGREES 32’ 52” E 464.67’ TO THE POINT OF BEGINNING AND CONTAINING 3.734 ACRES
BY SURVEY. ACTUAL FIELD SURVEY PERFORMED BY PHILLIP M. STATON, R.L.S. #1636, ON
MAY 2, 2000.

 

BEING
ALL OF THE SAME PROPERTY ACQUIRED BY PAMIDA, INC., BY DEED FROM ALBERT
AUSTIN JONES, III, JAMES W. CATES AND CONSTANCE S. CATES, HUSBAND AND
WIFE, DATED MAY 18, 2000 AND RECORDED MAY 18, 2000 IN WARRANTY DEED
BOOK 291, AT PAGE 157, IN THE OFFICE OF THE OVERTON COUNTY REGISTER OF
DEEDS AT LIVINGSTON, TENNESSEE.

 

Together
with non-exclusive easement rights created by Permanent Access Easement
Agreement of record in Book 291, Page 500, Office of the Register of Deeds
for Overton County, Tennessee

 

Together
with non-exclusive easement rights created by Slope Easement Agreement of
record in Book 291, Page 507, Office of the Register of Deeds for Overton
County, Tennessee.

 

Together
with non-exclusive easement rights created by Permanent Pylon Sign Easement
Agreement of record in Book 291, Page 513, Office of the Register of Deeds
for Overton County, Tennessee.

 

TAX
I.D.:  62-30.06

 

 

LEGAL DESCRIPTION

 

That
part of the North 1/2 of the Northwest 1/4 of Section 30, Township 12
North, Range 12 West, described as commencing at the West 1/4 corner of said Section 30;
thence along the West section line North 00 degrees 02 minutes 36 seconds
East 1006.77 feet to the South right-of-way of Highway M-82; thence along said
right-of-way North 84 degrees 54 minutes 04 seconds East 1211.31 feet to the
Southwest corner of Lot 10 in the recorded Plat of River Valley Center; thence
along the East right-of-way of Pine Lake Drive North 05 degrees 05 minutes 56
seconds West 268.00 feet to the point of beginning; thence continuing along
said right-of-way North 00 degrees 15 minutes 53 seconds East 285.24 feet;
thence 54.90 feet along a curve to the left, having a radius of 458.00 feet, a
delta of 06 degrees 52 minutes 03 seconds, and a long chord bearing North 03
degrees 10 minutes 08 seconds West 54.86 feet; thence South 89 degrees 44
minutes 07 seconds East 478.29 feet; thence South 00 degrees 15 minutes 53
seconds West 340.00 feet; thence North 89 degrees 44 minutes 07 seconds West
475.00 feet to the point of beginning.

 

Above
described parcel now known as:

 

Lot
14, River Valley Center No. 2, according to the plat thereof recorded in
Liber 11 of Plats, page 9, Newaygo County Records.

 

Together
with non-exclusive easement rights created by Storm Water and Retention Pond
Easement Agreement as disclosed by instrument recorded in Liber 386, page 3002.

 

TAX
I.D.:  62-19-30-130-012

 

 

LEGAL DESCRIPTION

 

PARCEL B

 

Part of the North 1/2 of the Southwest 1/4 of Section 2,
Town 16 North, Range 4 West, Township of Vernon, Isabella County, described as:
Commencing at the Southwest corner of said Section 2; thence North 00
degrees 26 minutes 54 seconds West along the West Section line, 1505.45
feet; thence North 89 degrees 33 minutes 06 seconds East 50.00 feet to the
Point of Beginning; thence continuing North 89 degrees 33 minutes 06 seconds
East 150.00 feet; thence North 00 degrees 26 minutes 54 seconds West 157.30
feet; thence North 89 degrees 17 minutes 07 seconds East 443.00 feet; thence
South 00 degrees 26 minutes 54 seconds West 70.00 feet; thence North 89 degrees
16 minutes 23 seconds East 622.33 feet; thence South 00 degrees 26 minutes 54
seconds East 193.05 feet; thence North 89 degrees 16 minutes 23 seconds East
397.84 feet; thence Southwesterly 85.86 feet along a 2188.83 feet radius curve
to the right and the Westerly right of way for B.R. U.S. 27 Expressway Limited
Access the long chord bearing South 30 degrees 01 minutes 21 seconds East 85.34
feet; thence South 89 degrees 16 minutes 23 seconds West 1505.29 feet; thence
North 00 degrees 26 minutes 54 seconds West 104.27 feet; thence South 89
degrees 33 minutes 06 seconds West 150.00 feet; thence North 00 degrees 26
minutes 54 seconds West 76.00 feet to the point of beginning.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 3, 2006 as Document No. 200600001124 in Liber 1333
at page 400.

 

Tax
Parcel No. 18-002-30-010-01

 

 

LEGAL DESCRIPTION

 

A
part of Lot 2 of Auditor’s Subdivision of the Southeast 1/4 of the
Southwest 1/4 of Section 16, Township 75 North, Range 7 West of the 5th P.M.,
Washington County, Iowa, more particularly described as follows:

 

Commencing
at the Northeast corner of the Southeast 1/4 of the Southwest 1/4 of said Section 16;
thence West along the North tine of the Southeast 1/4 of the Southwest 1/4 of
said Section 16, a distance of 336.61 feet to the Northeast corner of said
Lot 2; thence S 000 29’ 21” W along the East line of said Lot 2 a distance of
42.13 feet to the Southerly line of State Highway 92 right-of-way and the point
of beginning; thence S 00° 29’ 21” W along the East line of said Lot 2 a
distance of 566.89 feet to the South line of the North 609 feet of said Lot 2;
thence West along the South line of the North 609 feet of said Lot 2 a distance
of 329.74 feet to the West line of said Lot 2: thence N 000 35’ 29” E along the
West line of said Lot 2 a distance of 571.94 feet to the Southerly line of
State Highway 92 right-of-way; thence S 890 07’ 15” E along the Southerly line
of State Highway 92 right-of-way a distance of 328.71 feet to the point of
beginning. The North line of the Southeast 1⁄4 of the Southwest l/4 of said Section 16
is assumed to bear West.

 

Excepting
from the above described property that portion which was conveyed to the State
of Iowa by Deed Recorded September 23, 1993 in Book 137 at Page 16.

 

Also
excepting from the above described property Parcel H and Parcel I as set forth
on the Plat of Survey recorded July 22, 2005 in Book 18 at Page 379
as Document No. 05-3125, Washington County, Iowa.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 3, 2006 as Document No. 06-0581 in Book 2006 at Page 581,
Washington County, Iowa.

 

Tax
Parcel Number: WACWS 11-16-376-005

 

 

LEGAL DESCRIPTION

 

The
following property is located in State of Minnesota, County of St. Louis and is
described as follows:

 

Lots
3 and 4 and Westerly 5 feet of Lot 5, Block 15, Ely, except minerals.

 

TAX
I.D.:  030-0010-01690

 

 

LEGAL DESCRIPTION

 

Lot
One (1), Volume 28 Certified Survey Maps, Page 49, Map No. 3904,
Document No. 577212, being a resurvey of Lot One (1), Volume 20 Certified
Survey Maps, Page 48, Map No. 3121, Document No. 490456, being part of
the Southwest 1/4 of the Southeast 1/4 and part of Government Lot One (1),
Section Thirteen (13), Township Twenty-eight (28) North, Range Twenty-one
(21) East, City of Oconto, Oconto County, Wisconsin.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 3, 2006 as Document No. 585143 in Volume 1191 at Page 938.

 

Tax
Key No. Part of 265-28130311299

 

 

LEGAL DESCRIPTION

 

Lot
4 of Pamida Subdivision, Marion, Kentucky, recorded in Land Use Registration
Book 1, Page 33.

 

Being
the same property conveyed to Pamida, Inc., a Delaware corporation, by
deed dated May 12, 2000, of record in Deed Book 186, page 370, in the
Crittenden County Clerk’s Office.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 2, 2006 in Deed Book 204, page 290.

 

Tax
ID No.: Part of 070-60-07-001-00

 

 

LEGAL DESCRIPTION

 

A
TRACT OF LAND LOCATED IN THE CITY OF SOMERVILLE, FAYETTE COUNTY, TENNESSEE,
BEING A PORTION OF LOT 6, AS SHOWN ON THAT FINAL PLAN OF PHASE 3, LANGDON SUBDIVISION,
AS RECORDED IN PLAT BOOK 7, PAGE 84, AS RECORDED IN THE REGISTER’S OFFICE
OF FAYETTE COUNTY, TENNESSEE, AND BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:

 

BEGIN
AT A 1/2” REBAR WITH PLASTIC CAP FOUND AT THE POINT OF INTERSECTION OF THE
SOUTH RIGHT-OF-WAY LINE OF MARGINAL STREET (30’R/W) WITH THE WEST RIGHT-OF-WAY
LINE OF JERNIGAN DRIVE (50’ R/W); THENCE SOUTH 32 DEGREES 09 MINUTES 45 SECONDS
EAST 232.38 FEET ALONG SAID WEST RIGHT-OF-WAY LINE TO A POINT OF CURVATURE;
THENCE SOUTHERLY A DISTANCE OF 140.69 FEET ALONG THE ARC OF A CURVE TO THE
RIGHT, SAID CURVE HAVING A RADIUS OF 1102.85 FEET AND A CHORD OF SOUTH 28
DEGREES 30 MINUTES 28 SECONDS EAST 140.60 FEET TO A POINT OF CURVATURE; THENCE
SOUTHERLY A DISTANCE OF 71.57 FEET ALONG THE ARC OF A CURVE TO THE RIGHT SAID
CURVE HAVING A RADIUS OF 1727.35 FEET AND A CHORD OF SOUTH 23 DEGREES 39
MINUTES 58 SECONDS EAST 71.56 FEET TO A POINT OF TANGENCY; THENCE SOUTH 22
DEGREES 28 MINUTES 45 SECONDS EAST 36.13 FEET ALONG SAID RIGHT-OF-WAY LINE TO A
POINT OF CURVATURE; THENCE SOUTHERLY A DISTANCE OF 148.40 FEET ALONG THE ARC OF
A CURVE TO THE RIGHT, SAID CURVE HAVING A RADIUS OF 1069.95 FEET AND A CHORD OF
SOUTH 18 DEGREES 30 MINUTES 20 SECONDS EAST 148.28 FEET TO A 1/2” REBAR WITH
PLASTIC CAP FOUND AT THE SOUTHEAST CORNER OF THE PARCEL DESCRIBED HEREIN AND
THE NORTHEAST CORNER OF LOT 5, PHASE 3, LANGDON SUBDIVISION; THENCE LEAVING
SAID RIGHT-OF-WAY LINE AND RUNNING WITH THE NORTH LINE OF LOT 5, SOUTH 88
DEGREES 38 MINUTES 24 SECONDS WEST 538.65’ TO A 1/2” REBAR WITH PLASTIC CAP
FOUND; THENCE NORTH 06 DEGREES 07 MINUTES 53 SECONDS EAST 571.83 FEET ALONG A
DIVISION LINE OF LOT 6 TO A 1/2” REBAR WITH PLASTIC CAP FOUND ON THE SOUTH LINE
OF MARGINAL STREET; THENCE NORTH 88 DEGREES 49 MINUTES 33 SECONDS EAST 197.05
FEET ALONG THE SOUTH LINE OF MARGINAL STREET TO THE POINT OF BEGINNING.

 

BEING
THE SAME PROPERTY CONVEYED TO PAMIDA, INC., A DELAWARE CORPORATION BY
WARRANTY DEED FROM JOHN R. PITNER AND WIFE, DIANNE PITNER OF RECORD IN BOOK
D549, PAGE 129, REGISTER’S OFFICE FOR FAYETTE COUNTY, TENNESSEE.

 

TAX
I.D.:  090F-C-12.02

 

 

LEGAL DESCRIPTION

 

The land referred to is situated in the County of
Pike, State of Indiana, is described as follows:

 

TRACT 2

 

That portion of the West 1/2 of Section 26,
Township 1 North, Range 8 West of the Second Principal Meridian, Washington
Township, Pike County, Indiana, being described as follows:

 

Commencing at the East corner of the Clifton Heights
Addition to the Town (now City) of Petersburg, Indiana, as per plat thereof,
recorded in Deed Book 45, page 562 in the office of the Recorder of Pike
County, Indiana; said East corner being monumented by a 1/2-inch rebar found
flush with a survey cap inscribed “E.O. Boyd LS7873”; thence, along the
Southeastern boundary of said Addition South 48 degrees 26 minutes 00 seconds
West 172.59 feet to a wood corner post found exposed 48 inches at the North
corner of the Manual Brent Lovell tract, as described in Deed Book 163, page 245
in said Recorder’s office; said corner post being witnessed by a 1/2 inch rebar
found exposed 5 inches with a survey cap inscribed “HDC ENG” North 42 degrees
14 minutes 00 seconds West 0.50 feet from the center of said post; thence South
42 degrees 14 minutes 00 seconds East 175.00 feet to a 5/8 inch rebar set flush
with a survey cap inscribed “D.L. Helms PLS 29600022” (referred to as a rebar
in the remainder of this description) at the East corner of said Lovell tract
and being the point of beginning of this description; thence North 48 degrees
26 minutes 00 seconds East 68.25 feet to a rebar set flush; thence North 42
degrees 14 minutes 00 seconds West 68.36 feet to a rebar set flush; thence
North 48 degrees 26 minutes 00 seconds East 48.41 feet to a rebar set flush;
thence Southeasterly 169.43 feet along an arc to the left and having a radius
of 107.87 feet and subtended by a long chord having a bearing of South 86
degrees 34 minutes 00 seconds East and a length of 152.54 feet; thence North 48
degrees 26 minutes 00 seconds East 48.29 feet to a rebar set flush; thence South
42 degrees 38 minutes 34 seconds East 247.45 feet to a rebar set flush; thence
South 47 degrees 39 minutes 23 seconds West 209.83 feet to a rebar set flush;
thence South 42 degrees 38 minutes 34 seconds East 22.00 feet to a rebar set
flush; thence South 47 degrees 39 minutes 23 seconds West 90.76 feet to a rebar
set flush; thence North 42 degrees 20 minutes 37 seconds West 135.00 feet to a
cotton spindle set flush; thence South 47 degrees 39 minutes 23 seconds West
220.96 feet to a cotton spindle set flush on the centerline of Indiana State
Road 56 and 61; thence along said centerline, Northwesterly 181.02 feet along
an arc to the right and having a radius of 53,714.79 feet and subtended by a
long chord having a bearing of North 42 degrees 24 minutes 23 seconds West and
a length of 181.02 feet to a cotton spindle set flush at the South corner of
said Lovell tract; thence North 48 degrees 26 minutes 00 seconds East 248.91
feet to the point of beginning.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 3, 2006 as Inst. No. 06320 in Misc. Book 145, page 3.

 

Tax
Parcel No. Part of 011-00222-01 and 011-00231-00

 

 

LEGAL DESCRIPTION

 

The
land referred to is situated in the County of Martin, State of Indiana, is
described as follows:

 

Tract
1

That
portion of the Southeast 1/4 of the Northwest 1/4 of Section 25, Township
3 North, Range 5 West of the Second Principal Meridian, City of Loogootee,
Martin County, Indiana (also being a portion of the 14.16 acre tract surveyed
by Kenneth C. Solliday, Indiana Registered Land Surveyor No. S0112, as
shown and described on a plat of survey dated April 8, 1999); being
described as follows:

 

Commencing
at the Northeast corner of the Northwest 1/4 of the Southeast 1/4 of said Section 25,
which is monumented by a 10-inch by 11-inch sandstone found exposed 10 inches;
thence South 87 degrees 34 minutes 56 seconds West 1,390.51 feet to a point on
the West right of way line of U.S. Highway 231 and Indiana Highway 45, said
point also being a point on an Easterly line of said 14.16 acre tract; thence
South 01 degrees 42 minutes 20 seconds West, on and along said right of way
line, 8.48 feet to the proposed U.S. Highway 50 bypass right of way; thence
South 09 degrees 44 minutes 39 seconds West on and along said right of way
line, 107.26 feet; thence South 45 degrees 20 minutes 56 seconds West, on and
along said right of way line, 78.34 feet; thence South 89 degrees 28 minutes 12
seconds West, on and along said right of way line, 333.12 feet; thence North 00
degrees 17 minutes 44 seconds West 155.10 feet; thence South 87 degrees 34
minutes 56 seconds West 121.14 feet; thence North 02 degrees 14 minutes 55 seconds
West 86.09 feet; thence North 16 degrees 30 minutes 05 seconds East 95.00 feet;
thence North 22 degrees 59 minutes 55 seconds West 151.00 feet to a 1-inch iron
pipe set exposed 6 inches with a survey cap inscribed “D.L. Helms PLS 29600022”
(referred to as an iron pipe set in the remainder of this description) at the
South most corner of the 4.42 acre tract described in deed to Pamida, Inc.
on June 4, 1999 in Deed Book 133, page 75 and as shown on the plat of
survey recorded in Survey Book “A” page 363 in the office of the Recorder
of Martin County, Indiana; said corner lies near the center of a creek and is
the Point of beginning of this description; thence along the Western boundary
of said 4.42 acre tract and said 14.16 acre tract the following three (3) courses;
(1) North 22 degrees 59 minutes 55 seconds West 27.00 feet to a 5/8-inch
rebar found exposed 10 inches near the center of said creek; (2) North 32
degrees 59 minutes 55 seconds West 54.98 feet to an iron pipe set exposed 6
inches at the toe of the East bank of said creek and (3) North 04 degrees
23 minutes 05 seconds East 241.16 feet to a 5/8 inch rebar set flush with a
survey cap inscribed “D.L. Helms PLS 29600022” (referred to as a rebar set in
the remainder of this description); thence North 53 degrees 11 minutes 09
seconds East 141.54 feet to a rebar set flush; thence North 24 degrees 02
minutes 42 seconds East 150.76 feet to a rebar set flush; thence North 34
degrees 51 minutes 19 seconds West 57.68 feet to a rebar set flush on the
Southeastern boundary of U.S. Highway 50; thence, along said Southeastern
boundary, North 55 degrees 08 minutes 41 seconds East 50.00 feet to a cotton
spindle set flush at a corner in the Northern boundary of said 4.42 acre tract;
thence South 36 degrees 45 minutes 19 seconds East 77.40 feet to a cotton
spindle set flush at another corner on the Northern boundary of said 4.42 acre
tract; thence South 24 degrees 02 minutes 42 seconds West 73.15 feet to a
cotton spindle set flush; thence South 37 degrees 37 minutes 29 seconds East
105.00 feet to a cotton spindle set flush; thence North 52 degrees 22 minutes
31 seconds East 172.28 feet to a rebar set flush on the Northern boundary of
said 4.42 acre tract; thence along the Northern, Eastern and Southeastern
boundaries of said 4.42 acre tract the following six (6) courses: (1) South
36 degrees 45 minutes 19 seconds East 196.94 feet to a 1/2 inch rebar found
flush; (2) North 88 degrees 14 minutes 41 seconds East 87.93 feet to a
cotton spindle set flush on the West boundary of U.S. Highway 231 (35 feet from
the centerline); (3) South 01 degree 42 minutes 15 seconds West, along
said West boundary, 75.15 feet to a rebar set flush; (4) South 88 degrees
14 minutes 41 seconds West 79.71 feet to a 1/2 inch rebar found flush; (5) North
36 degrees 45

 

 

minutes
19 seconds West 83.56 feet to a cotton spindle set flush and (6) South 53
degrees 14 minutes 44 seconds West, passing a 1/2 inch rebar found flush at
533.79 feet, 563.71 feet in all to the point of beginning.

 

Together
with a non-exclusive easements as created by Cross-Easement Agreement recorded
in Deed Record 133, page 78.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 22, 2006 as Inst. No. 2006000464 in Book 53, page 10.

 

Tax
ID No. Part of 008-76252-09

 

 

LEGAL DESCRIPTION

 

TRACT
1

That
portion of the South 1/2 of Section 26, Township 7 North, Range 5 West of
the Second Principal Meridian, Town of Bloomfield, Richland Township, Greene
County, Indiana; being described as follows:

 

Commencing
at the Northwest corner of the Southeast 1/4 of said section, which is
monumented by a 1/2-inch rebar found flush in the approximate center of Furnace
Road (County Road 50 South); thence, along the West line of said 1/4 line
section, South 00 degrees 25 minutes 52 seconds West 212.48 feet; thence South
87 degrees 56 minutes 17 seconds East 544.72 feet to a railroad spike found
flush in the approximate center of Furnace Road; thence South 00 degrees 35
minutes 31 seconds East 226.99 feet to a 1/2 inch rebar found flush at the
Northeast corner of the 5.44 acre tract described in deed (also shown on a plat
of survey) to Pamida, Inc. on June 9, 1999 in Deed Book 305, page 857
in the office of the Recorder of Greene County, Indiana and being the Point of
Beginning of this description; thence continuing South 00 degrees 35 minutes 31
seconds East, passing a 5/8 inch rebar found flush at 355.65 feet with a survey
cap inscribed: “Bledsoe Tapp PC 50920004”, 390.02 feet in all to a 1/2 inch
rebar found flush with a survey cap inscribed “HDC ENG” at the Southeast corner
of said 5.44 acre tract; thence along the Southern boundary of said 5.44 acre
tract the following four (4) courses: (1) North 89 degrees 59 minutes
50 seconds West 290.33 feet to a 1/2 inch rebar found flush with a survey cap
inscribed “HDC ENG”, (2) North 29 degrees 42 minutes 46 seconds West
159.44 feet to a 5/8 inch rebar found flush; (3) South 69 degrees 33
minutes 31 seconds West 118.91 feet to a 5/8 inch rebar found flush with a
survey cap inscribed “Bledsoe Tapp PC 50920004” and (4) South 65 degrees
08 minutes 04 seconds West 132.59 feet to a 5/8 inch rebar set flush with a
survey cap inscribed “D.L. Helms PLS 29600022”; thence North 25 degrees 34
minutes 08 seconds West 142.37 feet to a 5/8 inch rebar set flush with a survey
cap inscribed “ D.L. Helms PLS 29600022” on the Northern boundary of said 5.44
acre tract; thence along the Northern boundary of said 5.44 acre tract the
following three (3) courses: (1) North 71 degrees 38 minutes 42
seconds East 129.31 feet to a 5/8 inch rebar found flush with a survey cap
inscribed “Bledsoe Tapp PC 50920004”; (2) North 04 degrees 06 minutes 04
seconds West 180.10 feet to a 1/2 inch rebar found flush with a survey cap
inscribed “HDC ENG” and (3) North 89 degrees 59 minutes 58 seconds East
548.65 feet to the point of beginning.

 

Together
with the non-exclusive easements created by that certain Cross-Easement
Agreement, recorded in Book 305, Page 863.

 

Tax
Parcel No. 025-01427-00; Tax Parcel No. 025-01443-00

 

 

LEGAL DESCRIPTION

 

Parcel
1:

 

That
part of the Southeast Quarter of the Northwest Quarter of Section 35,
Township 139 North, Range 41 West of the 5th Principal Meridian, Becker County,
Minnesota (also being a part of Auditor’s Lot 1 of the Amended Auditor’s
Plat of Parts of the Southeast Quarter of the Northwest Quarter, the Northeast
Quarter of the Southwest Quarter, the Northwest Quarter of the Southeast Quarter
and Government Lot 3, Section 35, Township 139 North, Range 41 West, said
plat is on file and of record in the office of the Becker County Recorder)
described as follows:

 

Commencing
at a found iron monument which designates the West Quarter corner of said Section 35;
thence North 89 degrees 59 minutes 57 seconds East 1,332.79 feet on an assumed
bearing along the East-West quarter line of said Section 35 to the
Southwest corner of said Southeast Quarter of the Northwest Quarter; thence
North 01 degree 10 minutes 07 seconds East 82.56 feet along the West line of
said Southeast Quarter of the Northwest Quarter to an iron monument; thence
continuing North 01 degree 10 minutes 07 seconds East 392.01 feet along the
West line of said Southeast Quarter of the Northwest Quarter to an iron
monument at the Southwesterly corner of said Auditor’s Lot 1; thence South 69
degrees 12 minutes 00 seconds East 277.00 feet along the Southerly line of said
Auditor’s Lot 1 to an iron monument, said point is the point of beginning;
thence continuing South 69 degrees 12 minutes 00 seconds East 100 feet along
the Southerly line of said Auditor’s Lot 1 to an iron monument at the
Southeasterly corner of said Auditor’s Lot 1; thence North 03 degrees 15
minutes 24 seconds East 181.00 feet along the Easterly line of said Auditor’s
Lot 1 to an iron monument on the Southerly right of way line of Trunk Highway No. 10;
thence South 17 degrees 16 minutes 13 seconds West 162.20 feet to an iron
monument; thence North 80 degrees 07 minutes 05 seconds West 56.45 feet to the
point of beginning.

 

Parcel
2:

 

Auditor’s
Lots 2 and 3 of the Amended Auditor’s Plat of a part of the Southeast
Quarter of the Northwest Quarter, the Northeast Quarter of the Southwest
Quarter, the Northwest Quarter of the Southeast Quarter and Government Lot 3 of
Section 35, Township 139 North, Range 41, according to the Certified Plat
thereon on file and of record in Book “D” of Plats, Page 66, of the
records of Becker County, Minnesota.

 

Tax
I.D # (R49-0459-000)

 

 

LEGAL DESCRIPTION

 

Lot
2, Pamida Subdivision, Carbon County, Wyoming.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 1, 2006 as Document No. 0918368 in Book 1097, page 85.

 

Tax
I.D.:  21872664

 

 

LEGAL DESCRIPTION

 

That
part of the Southeast Quarter of the Northeast Quarter (SE1/4 NE1/4) of Section Seven
(7) in the Township One Hundred Thirty-two (132) North, of Range
forty-seven (47), West of the fifth Principal Meridian, in the City of
Wahpeton, Richland County, North Dakota, described as in the following Two
Tracts:

 

Tract
1. Commencing at the Southeast corner of the Northeast Quarter (NE1/4) of said Section Seven
(7); thence North 0o 00’ West a distance of 418.2 feet to a point; thence South
89o 30’ West a distance of 420 feet to a point; thence South 0o 00’ East a
distance of 80 feet, to The Point of Beginning; thence Westerly, along a line
parallel to the South boundary of Block Eight (8) of Holbrook and Hobson’s
Addition to the said City of Wahpeton, projected West, a distance of 590.4 feet
to a point; thence North 24o 15’ East a distance of 268.4 feet, to the
Southerly boundary of Industrial Avenue in the said City of Wahpeton; thence
along the Southerly boundary of Industrial Avenue, in a Southeasterly
direction, a distance of 520.7 feet to a point; thence South 0o 00’ East, to
the point of beginning.

 

Tract
2. Commencing at a point 80 feet South and 80 feet West of the Southwest corner
of Block Eight (8) of Holbrook and Hobson’s Addition to the said City of
Wahpeton; running thence Westerly 590.4 feet, in a line parallel with the South
line of said Block Eight (8) projected; thence Southerly, in a line
parallel with the West line of said Block Eight (8) projected, to a point
Forty (40) feet North to the East and West Quarter Section line between
the Northeast Quarter (NE1/4) and the Southeast Quarter (SE1/4) of said Section Seven
(7); thence Easterly 590.4 feet, in a line parallel with the said Quarter Section line;
thence Northerly, in a line parallel with the West line of said Block Eight (8) projected,
to the point of beginning.

 

Excepting
therefrom the following described three tracts:

 

Exception
Tract 1. Commencing at the East Quarter corner of said Section Seven (7);
thence on an assumed bearing of Due North, on and along the East line of said Section Seven
(7), a distance of 337.58 feet; to its intersection with the easterly
extension of the South right-of-way line of 3rd Avenue South; thence South 89o
25’ 03” West, along the said South right-of-way line of 3rd Avenue South, a
distance of 419.91 feet, to its intersection with the southerly extension
of the West right-of-way line of 12th Street South; thence Due North, along the
said southerly extension of the West right-of-way line of 12th Street South a
distance of 34.15 feet, to its intersection with the South right-of-way
line of Industrial Avenue; thence North 65o 50’ 32” West, along the said South
right-of-way line of Industrial Avenue, a distance of 109.60 feet, to the Point
of Beginning; thence Due South, parallel with and 100.00 feet West of the East
line of that certain tract described and recorded in Book “112” of Deeds on Page 688,
said Book on file in the Office of the Register of Deeds in and for Richland
County, North Dakota, a distance of 197.95 feet; thence North 65o 50’ 32” West
and parallel with the said South right-of-way line of Industrial Avenue, a
distance of 112.69 feet, to its intersection with the southwesterly
projection of the East exterior wall of the Pamida building; thence North 24o
18’ 59” East, along the said southwesterly projection of the East Pamida wall,
a distance of 10.05 feet, to the Southeast corner of the said Pamida building;
thence continuing North 24o 18’ 59” East, on and along the said East exterior
wall of the Pamida building, a distance of 120.84 feet, to the Northeast corner
of the said Pamida building; thence North 65o 50’ 22” West, on and along the
North exterior wall of the said Pamida building, a distance of 119.59 feet, to
a corner of the said North wall; thence North 24o 18’ 59” East, on and along
said North wall of the Pamida building, a distance of 30.00 feet, to a corner
of the said North wall; thence North 65o 50’ 22” West, on and along the said
North exterior wall of the Pamida building, a distance of 240.15 feet, to the
Northwest corner of the said Pamida building; thence North 65o 33’ 50” West a
distance of 20.22 feet, to the West line of the said tract described and recorded
in Book 112 of Deeds on Page 688; thence North 24o 26’ 10” East, along the
said West line of the tract described in Book 112 of Deeds on Page 688, a
distance of 19.61 feet, to its intersection with the said South
right-of-way line of Industrial Avenue; thence South 65o

 

 

50’
32” East, on and along the said South right-of-way line of Industrial Avenue, a
distance of 411.10 feet, to the point of beginning.

 

Exception
Tract 2. Commencing at the East Quarter corner of said Section Seven (7);
thence on an assumed bearing of South 88o 12’ 50” West, on and along the South
line of the said Northeast Quarter (NE1/4) of Section Seven (7), a
distance of 1010.55 feet; thence Due North a distance of 75.04 feet, to the
North right-of-way line of North Dakota State Highway No. 13 and to The
Point of Beginning, a said point also being the Southwest corner of that
certain tract described and recorded in Book “112” of Deeds on Page 688,
said Book on file in the Office of the Register of Deeds in and for Richland
County, North Dakota; thence Due North, on and along the West line of the said
tract described in Book “112” of Deeds on Page 688, a distance of 283.77
feet, to its intersection with the westerly projection of the South
right-of-way line of 3rd Avenue South; thence North 24o 26’ 10” East and
continuing along the West line of the said tract described in Book “112” of
Deeds on Page 688, a distance of 145.04 feet; thence Due South and
parallel with the West line of the said tract described in Book “112” of Deeds
on Page 688, a distance of 413.95 feet, to the said North right-of-way
line of State Highway No. 13; thence South 88o 12’ 50” West, on and along
the said North right-of-way line of State Highway No. 13, a distance of
60.03 feet, to the point of beginning.

 

Exception
Tract 3. Commencing at the East Quarter Corner of said Section 7 (North
Dakota Land Survey Monument Record No. 362 and 1161); thence on an assumed
bearing of due North on and along the East line of said Section 7 a
distance of 337.58 feet; thence South 89o 25’ 03” West on and along the said
South right-of-way line of 3rd Avenue South, City of Wahpeton, North Dakota, a
distance of 419.91 feet to its intersection with the southerly extension
of the West right-of-way line of 12th Street South, City of Wahpeton, North
Dakota, and to The Point of Beginning; thence due South on and along the said
southerly extension of the West right-of-way line of 12th Street South a
distance of 244.02 feet to its intersection with the northwesterly
right-of-way line of that certain tract described and recorded in Book P of
Miscellaneous Records on Page 592 shown as Parcel No. 1, said Book on
file in the Office of the Register of Deeds in and for said Richland County,
North Dakota; thence on and along said northwesterly right-of-way line on a
684.54 foot radius curve that is concave to the northwest, said curve having a
central angle of 6o 14’ 20”, a length of 74.54 feet, a chord bearing of South
66o 41’ 36” West and a chord distance of 74.50 feet; thence South 88o 12’ 50”
West on and along the North right-of-way line of North Dakota State Highway No. 13
a distance of 31.59 feet; thence due North a distance of 353.49 feet to the
southwesterly right-of-way line of Industrial Avenue, City of Wahpeton; thence
South 65o 50’ 32” East on and along said southwesterly right-of-way line of
Industrial Avenue a distance of 109.60 feet to its intersection with said
southerly extension of the West right-of-way line of 12th Street South; thence
due South on and along said Southerly extension of the West right-of-way line
of 12th Street South a distance of 34.15 feet to the point of beginning.

 

	
  Tax I.D.:

  	
  50-1301-14683-000

  
	
   

  	
  50-1301-14684-000

  
	
   

  	
  50-1301-14685-000

  

 

 

LEGAL DESCRIPTION

 

The
following property is located in County of Cass, City of Dowagiac, State of
Michigan and is described as follows:

 

That
part of the fractional North half of fractional Section 2, Town 6
South, Range 16 West, described as: Commencing at the East quarter post of said
Section 2; thence North 87 degrees 15 minutes 37 seconds West, on the East
and West quarter line, 1671.35 feet, to the centerline of State Highway M-51;
thence on said centerline, 57.27 feet on the arc of a 1160.09 foot radius curve
to the right to the far end of a chord which bears North 40 degrees 43 minutes
33 seconds East, 56.91 feet, to the place of beginning of the parcel of land
herein described; thence North 49 degrees 26 minutes 24 seconds West
(previously recorded as North 49 degrees 28 minutes 53 seconds West), on the
Easterly line of the Pokagon Street extension, 88.65 feet; thence continuing on
said Easterly line, North 46 degrees 10 minutes 02 seconds West, 203.78 feet;
thence continuing on said Easterly line, Northwesterly 152.73 feet, on the arc
of a 567.00 foot radius curve to the right to the far end of a chord which
bears North 38 degrees 26 minutes 51 seconds West, 152.73 feet; thence North 47
degrees 35 minutes 11 seconds East, parallel with the centerline of State
Highway M-51, 444.67 feet; thence South 42 degrees 26 minutes 21 seconds East,
438.00 feet to the centerline of said Highway M-51; thence on said centerline,
South 47 degrees 35 minutes 11 seconds West, 347.33 feet; thence Southerly
83.96 feet on the arc of a 1160.09 foot radius curve to the left to the far end
of a chord which bears South 43 degrees 56 minutes 18 seconds West, 83.94 feet,
to the place of beginning.

 

Tax
I.D.:  14-160-110-042-65

 

 

LEGAL DESCRIPTION

 

Parcel
1:

Lots
3, 4 and 5 of the plat of Comfort Estates, according to the recorded plat
thereof, Oceana County Records.

 

Parcel
2:

That
part of Lot 6 of Comfort Estates, according to the recorded plat thereof,
Oceana County Records, described as follows: Commencing at the Northeasterly
corner of said Lot 6, being the point of beginning; thence South 00 degrees 42
minutes 00 seconds East along the Easterly line of said Lot 6 for a distance of
156.14 feet; thence North 60 degrees 00 minutes 00 seconds West, 305.83 feet to
a point of deflection on the line common to Lots 5 and 6 of said Comfort
Estates; thence North 89 degrees 18 minutes 00 seconds East, along the
Southerly line of said Lot 5 for a distance of 262.97 feet to the point of
beginning.

 

Easement
Parcels:

Non-Exclusive
Easement for Ingress and Egress as created, limited and defined by Permanent
Construction and Access Easement Agreement dated September 25, 2000,
recorded October 11, 2000, in Liber 2000, page 17827, Oceana County
Records.

 

Non-Exclusive
Easement for the construction of a pylon sign as created, limited and defined
by Easement Agreement recorded in Liber 2000, page 19747.

 

TAX
I.D.:  64-020-819-200-166

 

 

LEGAL DESCRIPTION

 

TRACT 3:

 

A part of the South 1/2 of Section 35,
Town 4 North, Range 1 West, Lawrence County, Indiana, described as follows:

 

COMMENCING at a Stone Monument (formerly Railroad
spike) at the Southeast Corner of the Southwest 1/4 of said Section 35;
thence along the East line of said 1⁄4 section, North 00 degrees 38 minutes 55
seconds West, 1473.94 feet to a Mag nail in the Southbound lane of Old SR# 37
(now Teke Burton Drive); thence along the South line of a 5.552 acres tract
conveyed to Pamida, Inc. in DR 132 on page 1345, South 89 degrees 30
minutes 32 seconds West, (South 89 degrees 30 minutes 44 seconds West on deed)
287.23 feet to a capped 5/8” rebar, said rebar being the POINT OF BEGINNING;
thence leaving said South line North 00 degrees 01 minutes 51 seconds East,
136.09 feet to a Mag nail; thence South 89 degrees 58 minutes 09 seconds East,
211.02 feet to a Mag nail in the centerline of Old SR# 37 (now Teke Burton
Drive); thence along the centerline of Old SR# 37 (now Teke Burton Drive) North
30 degrees 16 minutes 47 seconds West, 28.44 feet; thence continuing with said
centerline North 32 degrees 13 minutes 00 seconds West, 214.50 feet to a Mag
nail in the North line of said 5.552 acres tract conveyed to Pamida, Inc.
in DR 132 on page 1345; thence along the North line North 89 degrees 49
minutes 10 seconds West, 412.57 feet to a capped 5/8” rebar; thence leaving
said North line South 00 degrees 23 minutes 06 seconds East, 346.13 feet to a
corner fence post on the before mentioned South line of said 5.552 acres tract
conveyed to Pamida, Inc. in DR 132 on page 1345; thence along said
South line North 89 degrees 30 minutes 32 seconds East, 327.85 feet to the
point of beginning.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 6, 2006 as Inst. No. 200600000869 in Book 277, Page 1174.

 

TAX.
I.D.:  12-007281-05

 

 

LEGAL DESCRIPTION

 

LAND
IN THE FIRST CIVIL DISTRICT, CENTERVILLE, HICKMAN COUNTY, TENNESSEE, LOCATED
SOUTH OF STATE HIGHWAY 100 AT ITS INTERSECTION WITH STATE HIGHWAY 48,
BEING LOT 5 AS SHOWN ON SUBDIVISION OF JOSEPH T. NICKELL PROPERTY OF RECORD IN
CABINET B, SLIDE 230B, OFFICE OF THE REGISTER OF DEEDS FOR HICKMAN COUNTY,
TENNESSEE.

 

INCLUDED
IN THE ABOVE DESCRIPTION BUT EXPRESSLY EXCLUDED THEREFROM IS LOT 5A ON THE
FINAL PLAT OF A RESUBDIVISION OF LOT 5 OF THE NICKELL PROPERTY, OF RECORD IN
PLAT CABINET D, SLIDE 220, OFFICE OF THE REGISTER OF DEEDS FOR HICKMAN COUNTY,
TENNESSEE.

 

BEING
PART OF THE SAME PROPERTY CONVEYED TO PAMIDA, INC., A WISCONSIN
CORPORATION BY WARRANTY DEED FROM JOSEPH T. NICKELL AND WIFE, MARY R. NICKELL,
OF RECORD IN BOOK 2, AT PAGE 3365, IN OFFICE OF THE REGISTER OF DEEDS,
HICKMAN COUNTY, CENTERVILLE, TENNESSEE.

 

TOGETHER
WITH NON-EXCLUSIVE EASEMENT RIGHTS CREATED BY DECLARATION OF CROSS-EASEMENTS
AND COVENANTS AND RESTRICTIONS AFFECTING LAND OF RECORD IN BOOK 2, PAGE 3368,
OFFICE OF THE REGISTER OF DEEDS FOR HICKMAN COUNTY, TENNESSEE.

 

TOGETHER
WITH EASEMENT RIGHTS CREATED BY PYLON SIGN EASEMENT AGREEMENT OF RECORD IN BOOK
2, PAGE 3391, OFFICE OF THE REGISTER OF DEEDS FOR HICKMAN COUNTY,
TENNESSEE.

 

TAX
I.D.:  084-040.01

 

 

LEGAL DESCRIPTION

 

Parcel
1:

 

That
part of the Northeast Quarter of the Northeast Quarter of Section 18,
Township 125 North, Range 37 West, Pope County, Minnesota, described as
follows:

 

Beginning
at the Northeast corner of said Section 18; thence South 00 degrees 05
minutes 51 seconds West, record bearing, along the East line of said Northeast
Quarter of the Northeast Quarter 355.50 feet to Point A; thence South 89 degrees
29 minutes 27 seconds West 726.00 feet; thence North 00 degrees 05 minutes 51
seconds East 355.50 feet to the North line of said Northeast Quarter of the
Northeast Quarter; thence North 89 degrees 29 minutes 27 seconds East along
said North line 726.00 feet to the point of beginning.

 

Parcel
2:

 

That
part of the Northeast Quarter of the Northeast Quarter of Section 18,
Township 125 North, Range 37 West, Pope County, Minnesota described as follows:

 

Beginning
at the Northeast corner of said Section 18; thence South 00 degrees 05
minutes 51 seconds West, record bearing, along the East line of said Northeast
Quarter of the Northeast Quarter 355.50 feet to Point A; Thence South 00
degrees 05 minutes 51 seconds West, record bearing, along the East line of said
Northeast Quarter of the Northeast Quarter 50 feet to Point B; thence South 89
degrees 29 minutes 27 seconds West 726.00 feet; thence North 00 degrees 05
minutes 51 seconds East 50 feet; thence North 89 degrees 29 minutes 27 seconds
East 726.00 feet to the point of beginning.

 

Tax
I.D. # (21-1201-000)

 

 

LEGAL DESCRIPTION

 

A
parcel of land being part of the Southeast Quarter of Section 8,
Township 6 North, Range 5 East, German Township, Village of Archbold, Fulton
County, Ohio and being more particularly described as follows:

 

Commencing
at a spike found at the Northeast corner of the Southeast Quarter of Section 8;

 

Thence,
North 88 degrees 38 minutes 33 seconds West, on the North Line of the Southeast
Quarter of Section 8, for a distance of 198.00 feet, to an iron pin found,
being the TRUE POINT OF BEGINNING for the parcel herein described;

 

Thence,
South 00 degrees 00 minutes 00 seconds West, on a line being parallel with the
East Line of the Southeast Quarter of Section 8, for a distance of 150.00
feet, to an iron pin found;

 

Thence,
South 88 degrees 38 minutes 33 seconds East on a line being parallel with the
North Line of the Southeast Quarter of Section 8, for a distance of 168.00
feet, to an iron pin found;

 

Thence,
continuing South 88 degrees 38 minutes 33 seconds East, for a distance of 30.00
feet, to a point on the East Line of the Southeast Quarter of Section 8;

 

Thence,
South 00 degrees 00 minutes 00 seconds west, on the East Line of the Southeast
Quarter of Section 8, for a distance of 50.00 feet, to a point;

 

Thence,
North 88 degrees 38 minutes 33 seconds West, on a line being parallel with the
North Line of the Southeast Quarter of Section 8, for a distance of 30.00
feet, to an iron pin found;

 

Thence,
continuing North 88 degrees 38 minutes 33 seconds west, for a distance of
168.00 feet, to an iron pin found;

 

Thence,
South 00 degrees 00 minutes 00 seconds West, on a line being parallel with the
East Line of the Southeast Quarter of Section 8, for a distance of 25.00
feet, to a 5/8” X 30” iron pin and reference cap set;

 

Thence,
North 88 degrees 38 minutes 33 seconds West, on a line being parallel with the
North Line of the Southeast Quarter of Section 8, for a distance of 125.00
feet, to a PK nail set;

 

Thence,
South 00 degrees 00 minutes 00 seconds West, on a line being parallel with the
East Line of the Southeast Quarter of Section 8, for a distance of 125.00
feet, to a 5/8” X 30” iron pin and reference cap set;

 

Thence,
North 88 degrees 38 minutes 33 seconds West, on a line being parallel with the
North Line of the Southeast Quarter of Section 8, for a distance of 334.48
feet, to an iron pin found;

 

Thence
North 00 degrees 07 minutes 15 seconds East, for a distance of 349.98 feet, to
an iron pin found, on the North Line of the Southeast Quarter of Section 8;

 

Thence,
South 88 degrees 38 minutes 33 seconds East, on the North Line of the Southeast
Quarter of Section 8, for a distance of 458.74 feet, to the TRUE POINT OF
BEGINNING of the parcel herein

 

 

described,
containing 3.556 acres of land, more or less, excepting therefrom all legal
easements, zoning restriction and legal highways of record.

 

The
bearings used herein are for the purpose of describing angles only and are not
referenced to true or magnetic North. All reference caps noted above are yellow
plastic caps stamped WIELAND – 8286. This legal description was based on a
survey prepared by Brian M. Wieland, State of Ohio Registered Surveyor No. 8286,
and recorded in Volume P, Page 224a of the Fulton County Record of
Surveys.

 

Together
with non-exclusive easement rights created by Cross Easement Agreement by
instrument recorded in Volume 94 of Official Records, page 289.

 

TAX
I.D.:  17-033518-03.000

 

 

LEGAL DESCRIPTION

 

Lot
3 in Southbridge Plaza, in the City of Dyersville, Iowa, according to the Plat
thereof recorded October 27, 1999, as document number 16616-99, situated
in Dubuque County, Iowa.

 

Together
with the non-exclusive easements created by Declaration of Cross Easements and
Covenants and Restrictions dated November 8, 1999 and recorded November 9,
1999, as document number 17195-99 and first amendment recorded November 30,
1999, as document number 17926-99.

 

Together
with an easement for the construction, operation and maintenance of a Pylon
Sign as created by Easement Agreement for a Sign dated December 2, 1999,
and recorded December 6, 1999, as document number 18251-99.

 

Tax
Parcel Number: 07 32 351 006

 

 

LEGAL DESCRIPTION

 

A
parcel of land being part of Lots 6, 7, 8 and 9 of the Shady Garden
Subdivision and also being part of the Southwest Quarter of Section 6,
Township 7 North, Range 3 East, The Village of Montpelier, Williams County,
Ohio and being more particularly described as follows: Commencing at a monument
box found, at the Southwest corner of the Southwest Quarter of Section 6;
THENCE North 00 degrees 00 minutes 00 seconds East, on the West line of the
Southwest Quarter of Section 6, for a distance of 178.35 feet to a point;
THENCE North 90 degrees 00 minutes 00 seconds East, for a distance of 30.00
feet, to a 5/8” inch pin found; THENCE South 78 degrees 28 minutes 54 seconds
East, for a distance of 190.45 feet, to a 5/8” inch iron pin found; THENCE
South 80 degrees 37 minutes 03 seconds East, for a distance of 91.19 feet, to a
5/8” x 30” iron pin and reference cap set, being the TRUE POINT OF BEGINNING
for the parcel herein described; THENCE North 00 degrees 00 minutes 00 seconds
East, for a distance of 461.46 feet, to a 5/8” x 30” iron pin and reference cap
set; THENCE North 90 degrees 00 minutes 00 seconds East, for a distance of
358.16 feet, to a 5/8” x 30” iron pin and a reference cap set; THENCE South 00
degrees 00 minutes 00 seconds West, for a distance of 502.81 feet, to a 5/8” x
30” iron pin and reference cap set; THENCE North 86 degrees 16 minutes 13
seconds West, for a distance of 178.61 feet, to a 5/8” iron pin found; THENCE
North 80 degrees 37 minutes 03 seconds West, for a distance of 182.37 feet to
the TRUE POINT OF BEGINNING of the parcel herein described, containing 4.001
acres of land, more or less, excepting there from all legal easements, zoning
restriction and legal highways of record.

 

The
bearings used herein are for the purpose of describing angles only and are not
referenced to true or magnetic North.

 

Surveyed
by Chester A. Miller, Registered Surveyor No. 6691, Surveyor, and recorded
in Volume 18R, Page 112 of the William County Survey Records in the office
of the William County Engineer.

 

Together
with non-exclusive easement rights created by Cross Easement Agreement by
instrument recorded in Volume 321 of Deeds, page 382.

 

Tax
I.D. (073-060-00-008.001)

 

 

LEGAL DESCRIPTION

 

Lot
Three of Certified Survey Map filed in Volume 6, page 267, Document No. 369836,
being a part of Government Lot 3, Section 4 and part of
Government Lot 6. Section 5, all in Township 20 North, Range 9 West, City
of Arcadia, Trempealeau County, Wisconsin.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 8, 2006 as Document No. 373600 in Volume 734, page 22.

 

TAX
I.D.:  201-1103-0002; 201-1106-0009

 

 

LEGAL DESCRIPTION

 

Parcel
1

 

A
parcel of land in the NE1/4NE1/4 of Section 13, Township 33 North, Range
100 West, 6th P.M., Fremont County, Wyoming, more particularly described
as follows:

 

Beginning
at Corner No. 1, which corner is the intersection of the southerly
right-of-way line of the Baldwin Creek Road and the westerly right-of-way line
of U.S. Highway 287, and which corner bears South 58°16’37” West, a distance of
58.25 feet from the northeast corner of said Section 13; thence South 0°51’20”
East along said Highway right-of-way a distance of 158.4 feet to Corner No. 2;
thence proceed South 89°16’12” West a distance of 565.2 feet to Corner No. 3;
thence North 9°41’35” West, a distance of 160.36 feet to Corner No. 4,
which corner is on the southerly right-of-way line of the Baldwin Creek Road;
thence North 89°16’12” East, along the said Baldwin Creek Road right-of-way a
distance of 589.87 feet to Corner No. 1, the Point of Beginning.

 

Parcel
2

 

Description
of a tract of land in the NE1/4NE1/4 of Section 13, Township 33 North,
Range 100 West, 6th P.M., within the City of Lander, Freemont
County, Wyoming, more particularly described as follows: Beginning at Point No. 1,
which point bears S. 13°26’09” W. a distance of 202.54 feet from the Northeast
corner of said Section 13; thence proceed: S. 89°16’12” W. a distance of
531.15 feet to Point No. 2; N 11°42’52” W.

A
distance of 8.14 feet to Point No. 3; N. 89°16’12” E. a distance of 532.65
feet to Point No. 4; S. 01°05’12” E. along the west side of the West Main
Street a distance of 7.99 feet to Point No. 1, the point of beginning.

 

Tax
I.D.:  10-3300-13-1-00-252-00

 

 

LEGAL DESCRIPTION

 

Lot
1 of the West 335 feet of Lot 1 in Waukon Industrial Park First Addition in the
City of Waukon, according to the Plat of Survey recorded in Book U, Page 89-93
as document 2005 2167, in Allamakee County, Iowa.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 3, 2006 as Document No. 2006 335 in Book 2006, page 335.

 

Tax
Parcel Number: 1031351020

 

 

LEGAL DESCRIPTION

 

Lot
4 in Hy-Vee Addition, Plat One, an Official Plat, Perry, Dallas County, Iowa,
except that part thereof described as beginning at the Southeast Corner of
said Lot 4, thence North 88° 41’ 30” West 227.41 feet; thence North 01° 18’ 30”
East 247.28 feet to the South line of Lot 5 in said Hy-Vee Addition; thence
South 88° 41’ 30” East along the South line of said Lot 5 a distance of 217.88
feet; thence South 00° 54’ 00” East 247.46 feet to the Point of Beginning.

 

Together
with the non-exclusive easements created by instrument entitled Easements with
Covenants and Restrictions Affecting Land recorded March 14, 1997 in book
831 at page 918 and supplement to Easements with Covenants and
Restrictions Affecting Land recorded April 26, 1999 in Book 1999 at page 004540.

 

Tax
Parcel Number: 675-05101-07

 

 

LEGAL DESCRIPTION

 

Tract
1A, Block 2, Second School Addition to Glasgow, Montana, according to the
official plat thereof on file and of record in the office of the Clerk and
Recorder, Valley County, Montana. Plat filed August 30, 2005, Doc. No. 129060.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded immediately prior hereto.

 

Parcel
ID No.: 1097097000

 

 

LEGAL DESCRIPTION

 

Lot 2 of ASHLAND COUNTY CERTIFIED SURVEY MAP NO. 451,
recorded September 30, 2005, as Document No. X299185, located partly
in Block 27 of Lake Shore Addition, and partly in 17th Avenue East in Block 50
of Ellis Division, City of Ashland, Ashland County, Wisconsin.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 2, 2006 as Document No. 300667 in Volume 618, page 232.

 

TAX
I.D.:  201-03428-0000

 

 

LEGAL DESCRIPTION

 

The land referred to is situated in the County of
Grant, City of Lancaster, State of Wisconsin, is described as follows:

 

Part of
the West 1/2 of the Southeast 1/4 of Section 35, in Township 5 North,
Range 3 West of the Fourth Principal Meridian, in the City of Lancaster, Grant
County, Wisconsin, more fully described as follows to wit:

 

Commencing
at the Southwest corner of the East 1/4 of the Southwest 1/4 of said Section 35;
thence North 00 degrees 26 minutes 43 minutes East, 1130.17 feet along the West
line of said East 1/4; thence South 89 degrees 33 minutes 17 seconds East
1555.53 feet to the point of beginning; thence North 00 degrees 29 minutes 02
seconds East 295.14 feet; thence North 89 degrees 30 minutes 58 seconds West
32.50 feet; thence North 00 degrees 29 minutes 02 seconds East 344. 46 feet to
the Southerly right of way line of U.S. Highway 61 and a point of curvature;
thence along said Southerly right of way line along a curve to the left through
a central angle of 10 degrees 30 minutes 01 seconds, an arc distance of 296.30
feet, a radius of 1616.79 feet, and a chord bearing North 77 degrees 01 minutes
25 seconds East 295.89 feet; thence South 00 degrees 32 minutes 53 seconds West
708.76 feet; thence North 89 degrees 27 minutes 07 seconds West 254.47 feet to
the point of beginning.

 

TOGETHER
WITH THE NON-EXCLUSIVE EASEMENTS CREATED BY THAT CERTAIN CROSS-EASEMENT
AGREEMENT RECORDED IN VOLUME 813, PAGE 343, AS DOCUMENT NO. 603755.

 

Tax
Item No. 246-1546-0010

 

 

LEGAL DESCRIPTION

 

Situate
in LaRue County, State of Kentucky:

 

Being
Lot 2B of the Amended Record Plat of Royall Centre Subdivision Lot 2, recorded
in Plat Cabinet 2, page 125, being a subdivision of Lot 2 of the Royall
Centre Subdivision, as recorded in Plat Cabinet 1, Slide 215 in the LaRue
County Court Clerk’s Office.

 

Being
a portion of the property conveyed to Pamida, Inc., a Delaware
corporation, by deed dated November 17, 1998, of record in Deed Book 173, page 99,
in the Office of the LaRue County Court Clerk.

 

Together
with non-exclusive easements created by Cross-Easement Agreement recorded in
Deed Book 173, page 103.

 

Tax
I.D # (029-03-01-001-07)

 

 

LEGAL DESCRIPTION

 

Being
a 3.925 acre tract located in SOUTH INDUSTRIAL PARK, in Morgantown, Kentucky,
on the Southwest right of way fence of the William Natcher Parkway, and more
particularly described as follows:

 

Beginning
at a capped iron pin set, being a new corner of the Morgantown Industrial
Holding Corp., Deed Book 141, Page 57, and referenced North 19 degrees 08
minutes 35 seconds East, 167.88 feet from the iron pin found, a corner of said
Holding Corp., and Mac and Janette Coleman, Deed Book 120, Page 541,
thence with new line of said Holding Corp., passing the line in Deed Book 141, Page 57,
then with Deed Book 128, Page 406, at 189.20 feet, North 37 degrees 25
minutes 00 seconds West, 484.99 feet to an iron pin set, being a new corner of
said Holding Corp.; thence North 49 degrees 33 minutes 40 seconds East, 354.27
feet to an iron pin set in what was once the location of the Green River
Parkway Right of Way and Access Control Fence; thence with said fence, South 37
degrees 15 minutes 49 seconds East, 33.04 feet, South 37 degrees 15 minutes 49
seconds East, 136.84 feet, and South 37 degrees 06 minutes 12 seconds East,
125.98 feet to an iron pin set, being a corner of said Holding Corp., Deed Book
128, Page 406, and Deed Book 141, Page 57; thence again with said
Fence Location, South 36 degrees 45 minutes 24 seconds East, 73.75 feet, and South
36 degrees 32 minutes 43 seconds East 115.60 feet to an iron pin set, being a
new corner of said Holding Corp.; thence passing iron pins set a 219.70 feet,
and 269.81 feet, South 49 degrees 33 minutes 40 seconds West, 350.51 feet to
the Beginning. This description is prepared from a physical survey performed by
Danny T. Cook P.L.S. #2877, Butler County Surveyor, on March 29, 1999.

 

Being
the same property conveyed to Pamida, Inc., a Delaware Corporation, by
deed dated the 31st day of March 1999, of record in Deed Book 155, Page 485,
in the Office of the Butler County Court Clerk.

 

Together
with non-exclusive easements created by Cross-Easement Agreement recorded in
Deed Book 7, page 222.

 

Tax
Parcel # (58-60-01)

 

 

LEGAL DESCRIPTION

 

PARCEL
1: Lot 1, Certified Survey Map No. 2816 recorded in the Office of the
Register of Deeds for Waupaca County, Wisconsin on January 5, 1989, in
Volume 8 on Page 344, as Document No. 461834, being a part of
CSM No. 184 Volume 1, Page 184, Waupaca County Registry and part of
the SW 1/4 - SE 1/4, Section 26, T25N, R14E, City of Clintonville, Waupaca
County, Wisconsin.

 

PARCEL
2: A parcel of land being a part of the NW 1/4 of the SE 1/4, Section 26,
T25N, R14E, City of Clintonville, Waupaca County, Wisconsin, more particularly
described as follows: Commencing at the SW corner of Lot 40, Floral Acres
Subdivision, City of Clintonville, thence N 89 degrees 56 W, 60.00 feet to the
West line of Morning Glory Drive and the point of beginning of the following
described parcel, thence along the arc of a curve to the left, having a radius
of 1015.00 feet and having a main chord bearing of S 0 degrees 46’ 49” E and a
length of 30.01 feet, thence S 88 degrees 26’ W, 339.72 feet to Easterly right
of way line of U.S.H “45” and also S.T.H. “22”, thence N 7 degrees 17’ 30” E
along the Easterly right of way line of said U.S.H and S.T.H. 398.90 feet,
thence S 82 degrees 40’ E, 291.31 feet to the West line of Morning Glory Drive,
thence S 0 degrees 04’ West along the West line of said drive 319.20 feet to
the point of beginning. EXCEPTING THEREFROM that pat sold to Schroeder Oil, Inc.,
by Quit Claim Deed recorded October 1, 1998 in Volume 916 of Records on page 195
as Document No. 582378. Together with right of access as contained in
Document No. 582379.

 

Tax
I.D.:  30-26-43-2 and 30-26-42-7

 

 

LEGAL DESCRIPTION

 

Lots
Thirteen (13), Fourteen (14), Fifteen (15), Sixteen (16), Seventeen (17) and
Eighteen (18) of Block Sixteen (16) and Lot Six (6) of Block Fifteen (15),
all in the Original Town Site of Plentywood, Sheridan County, Montana.

 

Tax
ID.: 391800

 

 

LEGAL DESCRIPTION

 

Being
a certain tract or parcel of land as shown on plat recorded in Minor Plat Book
1, page 31, Allen County Clerk’s Office, Scottsville, Kentucky, and
further described as follows:

 

Unless
stated otherwise, any monument referred to herein as an iron pin is a set 3/4”
iron rebar, 18” in length with red plastic cap stamped “K, Crowe #3375”. All
bearings stated herein are referred to in Deed Book 169, page 235.

 

Beginning
at an iron pin set on the South right of way of Old Gallatin Road, said point
lies 30 feet from the centerline, also being the Northwest corner of the tract
described; thence, with said right of way North 53 degrees 57 minutes 00
seconds East 375.18 feet to an iron pin set on the West property line of the
Howard Cline property as recorded in Deed Book 115, page 421; thence
leaving said right of way and with the West property line of the Cline property
and the West property line of the Jess Taylor property (as recorded in Deed
Book 105, page 514), the J. Hugh Beam property (as recorded in Deed Book
150, page 437), and the Paul Foster property (as recorded in Deed Book
123, page 67), South 25 degrees 01 minutes 00 seconds East 565.03 feet to
an iron pin set; thence severing the property of Jeffrey Young as recorded in
Deed Book 169, page 235, South 64 degrees 59 minutes 00 seconds West
354.00 feet to an iron pin set; thence North 25 degrees 12 minutes 02 seconds
West 415.23 feet to an iron pin set at the Southeast corner of the Hinton and
King properties, as recorded in Deed Book 107, page 57; thence with said
East property line of the Hinton and King properties, North 34 degrees 25
minutes 00 seconds West 79.06 feet to the point of beginning.

 

Being
the same property conveyed to Pamida, Inc., a Delaware corporation, by
deed dated the 30th day of December, 1998 of record in Deed Book 198, page 770,
in the Office of the Allen County Court Clerk.

 

Together
with non-exclusive easements created by Cross Easement Agreement as disclosed
by instrument recorded in Deed Book 198, page 773.

 

Tax
Item No. 5-4-11B-1

 

 

LEGAL DESCRIPTION

 

COMMENCING
AT THE SOUTHEAST CORNER OF THE SOUTHWEST QUARTER OF THE NORTHEAST QUARTER OF SECTION 11,
TOWNSHIP 13 NORTH, RANGE 5 EAST OF THE THIRD PRINCIPAL MERIDIAN; THENCE NORTH
00 DEGREES 32 MINUTES 29 SECONDS WEST 131.68 FEET ALONG THE EAST LINE OF THE
SOUTHWEST QUARTER OF THE NORTHEAST QUARTER OF SAID SECTION 11 TO THE TRUE
POINT OF BEGINNING; THENCE NORTH 89 DEGREES 41 MINUTES 25 SECONDS WEST 199.71
FEET; THENCE SOUTH 00 DEGREES 40 MINUTES 37 SECONDS EAST 131.28 FEET TO THE
SOUTH LINE OF THE SOUTHWEST QUARTER OF THE NORTHEAST QUARTER OF SAID SECTION 11;
THENCE NORTH 89 DEGREES 34 MINUTES 20 SECONDS WEST 459.03 FEET ALONG SAID SOUTH
LINE; THENCE NORTH 00 DEGREES 53 MINUTES 18 SECONDS WEST 333.22 FEET; THENCE
SOUTH 89 DEGREES 41 MINUTES 25 SECONDS EAST 460.24 FEET; THENCE SOUTH 00
DEGREES 40 MINUTES 37 SECONDS EAST 152.86 FEET; THENCE SOUTH 89 DEGREES 41
MINUTES 25 SECONDS EAST 199.83 FEET TO THE EAST LINE OF THE SOUTHWEST QUARTER
OF THE NORTHEAST QUARTER OF SAID SECTION 11; THENCE SOUTH 00 DEGREES 32
MINUTES 29 SECONDS EAST 50.01 FEET ALONG SAID EAST LINE TO THE TRUE POINT OF
BEGINNING, SITUATED IN THE CITY OF SULLIVAN, MOULTRIE COUNTY, ILLINOIS.

 

TOGETHER
WITH NON-EXCLUSIVE EASEMENTS AS CREATED BY CROSS-EASEMENT AGREEMENT MADE BY AND
BETWEEN PAMIDA, INC., AND MID-ILLINOIS BANK AND TRUST, AS TRUSTEE UNDER
TRUST AGREEMENT DATED MARCH 25, 1978 AND KNOWN AS TRUST NUMBER 113 DATED NOVEMBER 12,
1998 AND RECORDED NOVEMBER 23, 1998 AS DOCUMENT 252942.

 

TAX
PARCEL NUMBER: 08-08-11-205-012

 

 

LEGAL DESCRIPTION

 

A
tract of land being part of the North half of Section 8, Township 21
North, Range 7 West, of the Second Principal Meridian, Fountain County, Indiana,
and also being part of a tract of land conveyed to Orris H. Wenzel as
Trustee of the Orris H. Wenzel Revocable Trust in a Warranty Deed recorded in
Deed Record 170, at pages 89-90 on October 29, 1991, in the Fountain
County Recorder’s Office, the boundary of which is described as follows:

 

Commencing
at the center of said Section 8, proceed North 89 degrees 36 minutes 44
seconds East along the South line of the Northeast quarter of said Section 8,
for a distance of 418.37 feet to an iron pin (said Warranty Deed dimension of
418 feet); thence North 01 degrees 09 minutes 43 seconds West through a found
stone, 1603.49 feet to a PK nail on the center line of State Route 28 (said
Warranty Deed dimension of 1628 feet, said Warranty Deed also describes the intersection of
this line and center line of State Route 28 as being 25 rods 2 links or 413.82
feet East of the West line of the Northwest quarter of Section 8, measures
as part of this legal description as 406.79 feet; thence around the arc of
a circular curve to the right along said center line, said curve having a
radius of 1273.24 feet, a chord length of 33.11 feet, a chord bearing of North
49 degrees 32 minutes 02 seconds West for an arc length of 33.11 feet to a PK
nail at a point being 1 1/2 rods West of the last described course, as measured
perpendicular to said course; thence South 01 degrees 09 minutes 43 seconds
East along said being 1 1/2 rods West of a previously described course with a
bearing of North 01 degrees 09 minutes 43 seconds West (said line also being
the West line of a 1 1/2 rod wide exception in said Warranty Deed), 137.76 feet
to an iron rod; thence South 46 degrees 41 minutes 24 seconds West, 469.36 feet
to an iron pin; thence North 43 degrees 18 minutes 36 seconds West, 251.90 feet
to an iron pin; thence North 24 degrees 39 minutes 07 seconds East, 21.57 feet
to an iron pin; thence around the arc of a circular curve to the left, said
curve having a radius of 285.00 feet, a chord length of 134.00 feet, a chord
bearing of North 11 degrees 03 minutes 20 seconds East for an arc length of
135.26 feet to an iron pin; thence North 02 degrees 32 minutes 27 seconds West,
55.75 feet to an iron pin; thence North 86 degrees 33 minutes 20 seconds East,
75.32 feet to an iron pin; thence North 48 degrees 49 minutes 32 seconds East,
285.79 feet to an iron pin; thence North 41 degrees 10 minutes 28 seconds West,
16.98 feet to an iron pin; thence North 48 degrees 49 minutes 32 seconds East,
50.00 feet to a PK nail on said center line of State Route 28; thence North 41
degrees 10 minutes 28 seconds East along said center line, 65.38 feet to a PK
nail; thence around the arc of a circular curve to the left along said center
line, said curve having a radius of 1273.24 feet, a chord length of 169.06
feet, a chord bearing of South 44 degrees 58 minutes 56 seconds East for an arc
length of 169.18 feet to the PK nail at the True Point of Beginning.

 

Together
with the non-exclusive easements created by that certain Cross-Easement
Agreement, recorded as Instrument No. 1998-09802, in Miscellaneous Records
96, Page 324.

 

Tax
I.D. (014-00291-01)

 

 

LEGAL DESCRIPTION

 

The
West 520.32 feet of the East 580.32 feet of Lots “F”, “G” and “H” of the
Subdivision of Lot 2 of the East Half (E 1/2) of the Southeast Quarter (SE 1/4)
of Section 13, Township 18 North, Range 5 East of the Third Principal
Meridian, Piatt County, Illinois, EXCEPT the South 25.00 feet of even width of
said Lot “H”, also described as beginning at the point of intersection of
the North line of said Lot “F” and the West Right-of-way line of Illinois Route
105 (South Market Street), running thence North 89 degrees 42 minutes 00
seconds West for 520.32 feet, thence South 00 degrees 00 minutes 00 seconds for
305.00 feet; thence North 89 degrees 42 minutes 00 seconds East 520.32 feet to
a point on the said West right-of-way line; thence North 00 degrees 00 minutes
00 seconds East for 305.00 feet to the point of beginning.

 

Tax
Parcel Number: 74-05-13-18-005-030-03

 

 

LEGAL DESCRIPTION

 

The land referred to is situated in the County of
Parke, State of Indiana, is described as follows:

 

TRACT A

 

Commencing at the Northeast corner of Section 1,
Township 15 North, Range 8 West, thence along the North line of said Section North
89 degrees 06 minutes 33 seconds West (Basis of Bearings, Indiana State Plane
Coordinate System-West Zone) 29.00 feet to an iron rod on the West right of way
line of the State Highway 41 (said right of way line being 25 feet West of the
centerline of said Highway); thence, along said right of way, South 00 degrees
35 minutes 13 seconds West 1028.75 feet to the Northeast corner of a tract of
land conveyed to Pamida, Inc. by Co-Personal Representatives Deed recorded
in Vol. 198, page 507 in the Office of the Recorder of Parke County,
Indiana, thence along the North line of said Pamida Tract, North 88 degrees 55
minutes 56 seconds West 14.37 feet to a capped iron (rod referred to herein
describes a 5/8 inch iron rebar with a plastic identification cap stamped “Land
Sciences”, “S0232”) thence, South 00 degrees 35 minutes 46 seconds West 5.12
feet to a capped iron rod; thence, South 03 degrees 43 minutes 08 seconds West
84.97 feet to the Point of Beginning; thence South 03 degrees 43 minutes 08
seconds West 70.06 feet to a capped iron rod; thence parallel with the North
line of said Pamida Tract North 88 degrees 55 minutes 56 seconds West 304.22
feet to a capped iron rod thence parallel with the East line of said Section,
South 00 degrees 35 minutes 13 seconds West 190.01 feet to the South line of
said Pamida Tract marked by a capped iron rod; thence along said South line,
North 88 degrees 55 minutes 56 seconds West 294.94 feet to the West line of
said Pamida Tract marked by a capped iron rod; thence, along said West line,
North 00 degrees 35 minutes 13 seconds East 350.00 feet to the North line of
said Pamida Tract marked by a capped iron rod; thence, along said North line,
South 88 degrees 55 minutes 56 seconds East 447.63 feet to a capped iron rod;
thence parallel with the East line of said Section, South 00 degrees 35 minutes
13 seconds West 90.00 feet to a capped iron rod; thence, parallel with the
North line of said Pamida Tract, South 88 degrees 55 minutes 56 seconds East
155.36 feet to the Point of Beginning.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded February 8, 2006 as Inst. No. 20060344 in Book 98, page 303.

 

Tax
Parcel No.: Part of 001-00582-01

 

 

LEGAL DESCRIPTION

 

Lot
1, Block 1, Erickson Addition to the City of Vermillion, Clay County, South
Dakota.

 

Tax
I.D.:  15295-0010-010-00

 

 

LEGAL DESCRIPTION

 

That
portion of Lots 1, 2 and 3 in Block 11 of Comstock’s Addition to the City of
Sturgis, Meade County, South Dakota, lying North of Lot H1 (commonly referred
to as Lazelle Street); INCLUDING the West Half of the vacated 12th Street
abutting and adjoining said Lot 1; BUT EXCEPTING therefrom Lot H2, as shows on
the plat filed in Plat Book 18, Page 115.

-AND-

Lots
1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11 and 12 in Block 10 of Comstock’s Addition to
the City of Sturgis, Meade County, South Dakota; INCLUDING the West Half of the
vacated 11th Street abutting and adjoining said Lot 1; AND INCLUDING the East
Half of the vacated 12th Street abutting and adjoining said Lot 12; BUT
EXCEPTING therefrom Lot H2, as shown on the plat filed in Plat Book 18, Page 115,

-AND-

That
portion of Lots 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23 and 24 in Block 10
of Comstock’s Addition to the City of Sturgis, Meade County, South Dakota,
lying North of Lot H1 (commonly referred to as Lazelle Street); INCLUDING the
west half of the vacated 11th Street abutting and adjoining said Lot 24; AND
INCLUDING the vacated alley of Block 10 and the vacated alley running through
11th Street; BUT EXCEPTING therefrom Lots H2 and H3, as shown on the plat filed
in Plat Book 18, Page 115.

-AND-

The
east half of the vacated 11th Street abutting and adjoining Lot 13 in Block 9
of Comstock’s Addition to the City of Sturgis, Meade County, South Dakota,
which reverted pursuant to Resolution recorded April 5, 1984 in Book 393, Pages 183-185.

-AND-

Lots
10, 11 and 12 in Block 9 of Comstock’s Addition to the City of Sturgis, Meade
County, South Dakota, INCLUDING the east half of the vacated 11th Street
abutting and adjoining said Lot 12.

 

Tax
I.D.:  01-55-09-10

 

 

LEGAL DESCRIPTION

 

T.
55 N., R. 99 W. 6th P.M., Park County, Wyoming

 

A
tract of land within Farm Unit “E”, according to the Farm Unit Plat, being
Tract 2 of Lot 63, according to the Government Resurvey and being more
particularly described as follows:

 

Beginning
at a point on the south line of Tract 2, which point is located 299.46 feet
S.67°34’W. from the southeast corner of Tract 2; thence S.67°34’W., along the
south line of Tract 2 for a distance of 300 feet; thence N.0°08’E., parallel to
the east line of Tract 2 for a distance of 702.83 feet; thence S.89°51’E.,
parallel to the north line of Tract 2 for a distance of 277.0 feet, more or
less, to a point located 276.5 feet west of the east line of Tract 2; thence
S.0°08’W., parallel to the east line of Tract 2 for a distance of 587.62 feet
more or less to the Point of Beginning.

 

Excepting
therefrom that portion conveyed to The Transportation Commission of Wyoming in
Quitclaim Deed recorded March 27, 2002 as Document No. 2002-2332.

 

Tax
I.D.:  02559906302004

 

 

LEGAL DESCRIPTION

 

Parcel I:

 

Situated
in the County of Highland, in the State of Ohio and in the City of Greenfield:

 

Being
a part of V.M.S. Nos. 647 and 650, and being further bounded and described
as follows:

 

Commencing
at a p.k. nail (set) in the centerline of State Route 28 also referred to as
Jefferson Street, said p.k. nail being the Northeasterly corner of a 3.235 acre
tract as conveyed to Zavakos Enterprises, Inc. (D.B. 334, Page 605)
and the Northwesterly corner of a 3.932 acre tract as conveyed to National
Church Residences of Greenfield, Inc. (D.B. 322, Page 301); thence
with the Easterly line of Zavakos Enterprises, Inc. and the Westerly line
of National Church Residences of Greenfield, Inc. S. 11 deg. 19’ 12” E.,
passing a 5/8” iron pin (set) at 30.00 ft., a total distance of 480.49 ft. to a
5/8” iron pin (set) marking the true point of beginning of the tract of land
herein described; thence continuing with the Westerly line of National Church
Residences of Greenfield, Inc. S. 11 deg. 54’ 20” E., a distance of 112.59
ft. to a 5/8” iron pin (set); thence with a new division line S. 86 deg. 31’ 12”
W. a distance of 525.02 ft. to a 5/8” iron pin (set); thence with another new
division line N. 11 deg. 13’ 14” W., a distance f 287.46 ft. to a 1” flat iron
rod (found), said iron rod being the Southwesterly corner of the 1.359 acre
tract as conveyed to Zavakos Enterprises, Inc. (D.B. 334, Page 609);
thence with the Southerly line of Zavakos Enterprises, Inc. S. 63 deg. 58’
23” E., a distance of 116.48 ft. to a 1 1/4” iron pipe (found); thence with the
Southerly line of Zavakos Enterprises, Inc. S. 74 deg. 40’ 49” E., passing
the Southeasterly corner to said 1.359 acre tract and continuing with the
Southerly line of a 3.235 acre tract also as conveyed to Zavakos Enterprises, Inc.
(D.B. 334, Page 605) a total distance of 312.01 ft. to a 1/2” iron pin
(found); thence also with the line of Zavakos Enterprises, Inc. S. 87 deg.
34’ 49” E., a distance of 151.30 ft. to the true point of beginning, containing
2.104 acres of land.

 

The
above description is subject to an easement 20 feet in width over the Southerly
portion of the above described 2.104-acre tract and being bounded and described
as follows:

 

Beginning
at a 5/8” iron pin (set) in the Westerly line of a 3.932 acre tract as conveyed
to National Church Residences of Greenfield, Inc. (D.B. 322, page 301)
and being the Southeasterly corner of the above described 2.104 acre tract;
thence with the Southerly line of the above describe 2.104 acre tract S. 86
deg. 31’ 12” W., a distance of 525.02 ft. to a 5/8” iron pin (set); thence with
the Westerly line of the above described 2.104 acres tract N. 11 deg. 13’ 14”
W. a distance of 20.18 ft.; thence with the Northerly line of the herein
easement N. 86 deg. 31’ 12” E., a distance of 524.78 to a point in the Westerly
line of the 3.932 acre tract as conveyed to National Church Residences of
Greenfield, Inc. (D.B. 322, page 302); thence with the Westerly line
of National Church Residences of Greenfield, Inc. S. 11 deg. 54’ 20” E., a
distance of 20.22 ft. to the beginning, containing 0.241 acres within said
easement.

 

Bearings
are based upon the record bearing (S. 74 deg. 56’ 00” W.) of the Southerly
margin of Jefferson Street according to Wilson Subdivision as found in Plat
Book 03, Page 02 (Envelope 52-B).

 

The
above description is a part of the original 6 acres, 136 poles “Second
Tract” as conveyed to B & I Developers and recorded in Official Record
Volume 134, page 851 of the Highland County Recorder’s Office.

 

Land
surveyed in July and October, 1995, under the direction of Thomas E.
Purtell, Registered Professional Surveyor No. 6519, the survey plat of
which is referred to as Drawing No. S95-340 on file in the office of
McCarty Associates, Hillsboro, Ohio.

 

 

SAVE
AND EXCEPT THE FOLLOWING:

 

Situated
in the City of Greenfield, County of Highland, State of Ohio, being a part of
V.M.S. Nos. 647 and 650, and being further bounded and described as follows:

 

Commencing
at a P.K. nail (set) in the centerline of Jefferson Street (State Route 28),
said P.K. nail being the Northwesterly corner of a 3.235 acres tract as
conveyed to Pamida, Inc. (O.R. 288, Page 293);

 

Thence
with the Westerly line of Pamida, Inc. S. 11 deg. 24’ 05” E, passing a 5/8”
iron pin (set) at 30.00 ft. a total distance of 362.14 ft. to a 5/8” iron pin
(set), said iron pin marking the true point of beginning of the tract of land
herein described;

 

Thence
with a new division line S. 11 deg. 24’ 05” E, a distance of 50.36 ft. to a 5/8”
iron pin (set);

 

Thence
with another new division line S. 78 deg. 46’ 46” W, a distance of 192.81 ft.
to a 5/8” iron pin (set), said iron pin being the Easterly line of an original
7 acre, 113 poles “First Tract” as conveyed to Charles William Buck, et ux
(O.R. 267, Page 225);

 

Thence
with Buck’s Easterly line N. 11 deg. 13’ 14” W, a total distance of 170.77 ft.
to a 1” flat iron rod (found), said flat iron being a corner to a 1.359 acre “Parcel
One” as conveyed to Susan E. Beechler (O.R. 259, Page 866 and O.R. 280, Page 129);

 

Thence
with Beechler’s Southerly line S. 63 deg. 58’ 23” E. a distance of 116.48 ft.
to a 1/4” iron pipe (found);

 

Thence
continuing with Beechler’s Southerly line S. 74 deg. 40’ 49” E., a distance of
111.70 ft. to the true point of beginning containing 0.461 acres of land.

 

Bearings
are based upon the record bearing (S. 74 deg. 56’ 00” W) of the Southerly
margin of Jefferson Street according to Wilson Subdivision as found in Plat
Book 03, Page 02 (Env. 52-B).

 

The
above description is a part of the 2.104 acres tract as conveyed to Pamida, Inc.
and recorded in Official Record 288, Page 295 of the Highland County
Recorder’s Office.

 

Land
surveyed in October 1999, under the direction of Eric N. Lutz, Registered
Professional Surveyor No. 7232, the survey plat of which is referred to as
Drawing No. S99-304 on file in the office of McCarty Associates,
Hillsboro, Ohio.

 

This
conveyance is a transfer between adjoining lot owners made in connection with Section 711.001
Sub-section B (1) of the Ohio Revised Code and does not create an
additional building site or violate any zoning regulations or other public
regulation in the parcel hereby conveyed or the balance of the parcel retained
by the Grantor herein.

 

The
parcel hereby conveyed may not hereafter be conveyed separately by the
Grantees nor any structure erected thereon without the prior approval of the
authority having approving jurisdiction of plats.

 

ALSO,
SAVE AND EXCEPT THE FOLLOWING:

 

Situated
in the City of Greenfield, County of Highland, State of Ohio, being a part of
V.M.S. No. 650, and being further bounded and described as follows:

 

Commencing
at a P.K. nail (set) in the centerline of State Route 28 also referred to as
Jefferson Street, said P.K. nail being the Northeasterly corner of a 3.235
acres tract as conveyed to Pamida, Inc. (O.R.

 

 

288,
Page 293) and the Northwesterly corner of a 3.932 acres tract as conveyed
to National Church Residences of Greenfield, Inc. (D.B. 322, page 301);

 

Thence
with the Easterly line of Pamida, Inc. and the Westerly line of National
Church Residences of Greenfield, Inc. S. 11 deg. 19’ 12” E, passing a 5/8”
iron pin (set) at 30.00 ft. a total distance of 480.49 ft. to a 5/8” iron pin (set),
said iron pin being a corner to the original 2.104 acres tract as conveyed to
Pamida, Inc. (O.R. 288, Page 295);

 

Thence
continuing with the Easterly line of Pamida, Inc. and the Westerly line of
National Church Residences of Greenfield, Inc. S. 11 deg. 54’ 20” E, a
distance of 112.59 ft. to a 5/8” iron pin (set) from which a 5/8” iron pin
(found) as set by James R. Cottrill, P.S. 6858 bears N 24 deg. 54’ 20” W, a
distance of 0.48 ft., said iron pin (set) being a corner to the remaining lands
of an original 6 acre, 136 poles “ Second Tract” as conveyed to Charles William
Buck, et ux (O.R. 267, Page 225);

 

Thence
with Buck’s line S. 86 deg. 31’ 12” W, a distance of 329.98 ft. to a 5/8” iron
pin (set), said iron pin marking the true point of beginning of the tract of
land herein described;

 

Thence
continuing with Bucks’s line S 86 deg. 31’ 12” W, a distance of 195.04 ft. to a
5/8” iron pin (set) from which a 5/8” iron pin (found) as set by James R.
Cottrill, P.s. 6858 bears N 11 deg. 24’ 55”, a distance of 0.13 ft., said iron
pin (set) being in the easterly line of an original 7 acre, 113 poles “First
Tract” as conveye to Charles William Buk, et ux (O.R. 267, Page 225);

 

Thence
with Buck’s line N 11 deg. 13’ 14” W, a distance of 116.69 ft. to a 5/8” iron pin
(set), said iron pin being the Southwesterly corner of a 0.461 acre “Parcel
Three” as conveyed to Susan E. Beechler (O.R. 331, Page 869);

 

Thence
with Beechler’s line N 78 deg. 46’ 46” E, a distance of 192.81 ft. to a 5/8”
iron pin (set);

 

Thence
with a new division line S 11 deg. 24’ 05” E, a distance of 142.96 ft. to the
true point of beginning, containing 0.575 acres of land.

 

Bearings
are base upon the record bearing (S74 deg. 56’ 00” W) of the Southerly margin
of Jefferson Street according to Wilson Subdivision as found in Plat Book 3, Page 03
(Envelope 52-B).

 

The
above description is a part of the original 2.104 acre tract as conveyed
to Pamida, Inc. and recorded in Official Record 288, Page 295 of the
Highland County Recorder’s Office.

 

Land
surveyed in October 1999, and January 2001, under the direction of
Eric N. Lutz, Registered Professional Surveyor No. 7232, the survey plat
of which is referred to as Drawing no. S99-304C on file in the office of
McCarty Associates, Hillsboro, Ohio.

 

Parcel
No. 27-13-000-224.01

 

Parcel II:

 

Situated
in the County of Highland in the Sate of Ohio and in the City of Greenfield,
VMS #647 and #650.

 

Being
bounded and described as follows: Beginning at a spike found in the center of
State Route No. 28, said point being the Northwest corner to the tract of
which this description is a part, said point also being a corner to a 0.575
acre tract of land owned by Zavakos Belmont, Inc. as recorded in Volume
267, Page 663 of the Highland County Deed Records; thence with the center
of State Route No. 28 N. 82 deg 25’ E.

 

 

a
distance of 191.15 ft. to a spike set at the point of true beginning to the
herein described tract; thence continuing with the center of said road N. 82
deg. 25’ E. a distance of 326.62 ft. to a spike (set), said point being a
corner to National Church Residences of Greenfield, Inc.; thence leaving
said road and running with their line S. 9 deg. 02’ E, crossing a 1/2 inch iron
pin found at 30.00 ft a total distance of 480.49 ft. to a 1/2 inch iron pin
(found) said point being a corner to Jerry E. Merritt, thence with Merritt’s
lines N. 84 deg 51’ 38” W. a distance of 150.03 ft. to a 1/2 inch iron pin
(found); thence N. 72 deg. 29’ 51” W. a distance of 203.64 ft. to a 1/2 inch
iron pin (found); thence with a new division line N 8 deg. 51’ W. crossing an
iron pin set at 331.04 ft. a total distance of 361.0 ft. to the point of true
beginning, containing 3.235 acres of land.

 

This
description is part of a 4.591 acre tract of land as conveyed to Zavakos
Belmont, Inc. by Deed recorded in Volume 258, page 794 of the
Highland County Record of Deeds. This description based on a survey by Charles
M. Ryan, Registered Surveyor No. 5383, November 1982.

 

Parcel
No. 27-14-001-138.00

 

 

LEGAL DESCRIPTION

 

PARCEL
1:

 

LOT
1 IN SHOPKO SUBDIVISION, BEING A RESUBDIVISION OF LOT 1 IN PAMIDA SUBDIVISION
OF A PART OF THE SOUTHWEST 1/4 OF SECTION 35, TOWNSHIP 16 NORTH,
RANGE 8, EAST OF THE THIRD PRINCIPAL MERIDIAN, ACCORDING TO THE PLAT THEREOF
RECORDED OCTOBER 19, 2005, IN PLAT CABINET 1, SLIDE 82, AS DOCUMENT NO. 245843,
IN DOUGLAS COUNTY, ILLINOIS.

 

PARCEL
2:

 

EASEMENT
FOR THE BENEFIT OF PARCEL 1 FOR SANITARY SEWER AND WATER LINE AS DEPICTED ON
THE PLAT OF SHOPKO SUBDIVISION RECORDED OCTOBER 19, 2005, IN PLAT CABINET
1, SLIDE 82, AS DOCUMENT NO. 245843.

 

PARCEL
3:

 

NON-EXCLUSIVE
EASEMENTS FOR THE BENEFIT OF PARCEL 1 AS SET FORTH AND DEFINED IN DECLARATION
AND AGREEMENT REGARDING EASEMENTS AND RESTRICTIONS MADE BY AND BETWEEN SHIRLEY
OIL AND SUPPLY COMPANY AND DIXIE HOLDINGS-TUSCOLA, INC., DATED NOVEMBER 29,
1999 AND RECORDED DECEMBER 27, 1999 IN BOOK 547, PAGE 315 AS DOCUMENT
219597.

 

Tax
Parcel Number: 09-02-35-300-032

 

 

LEGAL DESCRIPTION

 

Tract
1:

 

The
South 131.25 feet of Lot Two (2), the West 100.00 feet of Lot Three (3) and
the South 342.45 feet of Lot Four (4), except the West 8.60 feet of said Lot 4,
Commercial Addition to the City of Osceola recorded February 25, 1971 in
book 42 at page 111, Clarke County, Iowa.

 

Tract
2:

 

The
East 150 feet of Lot 3 in Commercial Addition to the City of Osceola recorded February 25,
1971 in book 42 at page 111, Clarke County, Iowa.

 

Together
with the non-exclusive easements created by Easements recorded January 17,
1978 in book 52 at pages 187, 190, 194 and 198.

 

Tax
Parcel Numbers: 00138 & 00139

 

 

LEGAL DESCRIPTION

 

Parcel
1:

 

That
part of the tract of land conveyed in Book 137 of Deeds, Page 928,
from the Fraternal Order of Eagles Aerie #870 to Pamida, Inc. on the 23rd
day of May, 1978 and that part of the tract of land conveyed in Book 137
of Deeds, Page 907, from Wilbeth, Inc. to Pamida, Inc. on the
19th day of May, 1978, lying Westerly of the following described line:

 

Commencing
at the Southeast corner of the tract conveyed in Book 137 of Deeds, Page 928;
thence Westerly along the Northerly right of way line of State Highway No. 34,
a distance of 116.08 feet to the point of beginning of the line to be
described; thence Northerly along a line parallel with the East line of Section 24,
Township 140 North, Range 35 West a distance of 113.41 feet; thence Easterly at
right angles to the last described line, a distance of 27.00 feet; thence
Northerly along a line parallel with said East section line, a distance of
400.00 feet to the North line of the tract of land conveyed in Book 137 of
Deeds, Page 928 and there said line terminates, Hubbard County, Minnesota.

 

LESS
AND EXCEPT that parcel conveyed to the State of Minnesota as described in
Conservator’s Deed recorded in Book 170 of Deeds on Page 836 as Document No. 209659.

 

Parcel
2:

 

The
North 190.3 feet of the following described parcel located in Hubbard County,
Minnesota;

 

That
part of the tract of land conveyed in Book 137 of Deeds, page 928,
from the Fraternal Order of Eagles Aerie #870 to Pamida, Inc. on the 23rd
day of May 1978 lying Easterly of the following described line:

 

Commencing
at the Southeast corner of the tract conveyed in Book 137 of Deeds, Page 928;
thence Westerly along the Northerly right of way line of State Highway No. 34,
a distance of 116.08 feet to the point of beginning of the line to be
described; thence Northerly along a line parallel with the East line of Section 24,
Township 140 North, Range 35 West a distance of 113.41 feet; thence Easterly at
right angles to the last described line, a distance of 27.00 feet; thence
Northerly along a line parallel with said East section line, a distance of
400.00 feet to the North line of the tract of land conveyed in Book 137 of
Deeds, Page 928 and there said line terminates.

 

Parcel
3:

 

That
part of the tract of land conveyed in Book 137 of Deeds, Page 928,
from the Fraternal Order of Eagles Aerie #870 to Pamida, Inc. on the 23rd
day of May, 1978 lying Easterly of the following described line:

 

Commencing
at the Southeast corner of the tract conveyed in Book 137 of Deeds, page 928;
thence

 

 

Westerly
along the Northerly right of way line of State Highway No. 34, a distance
of 116.08 feet to the point of beginning of the line to be described; thence
Northerly along a line parallel with the East line of Section 24, Township
140 North, Range 35 West a distance of 113.41 feet; thence Easterly at right
angles to the last described line, a distance of 27.00 feet; thence Northerly
along a line parallel with said East section line, a distance of 400.00
feet to the North line of the tract of land conveyed in Book 137 of Deeds, Page 928
and there said line terminates, Hubbard County, Minnesota.

 

LESS
AND EXCEPT the North 190.3 feet thereof.

 

LESS
AND EXCEPT that parcel conveyed to the State of Minnesota as described in
Quitclaim Deed recorded in Book 170 of Deeds on Page 837 as Document No. 209660.

 

Tax
I.D # (R32-24-05600)

Tax
I.D # (R32-24-05610)

 

 

LEGAL DESCRIPTION

 

The
land referred to is situated in the State of Missouri, County of Gentry and is
described as follows:

 

	
  Tract 1:

  	
  Lot One (1), Block Six (6), City of Albany, Gentry County, Missouri,

  
	
   

  	
   

  
	
  Tract 2:

  	
  The North 22 feet of Lot Two (2), Block Six (6), City of Albany,
  Missouri,

  
	
   

  	
   

  
	
  Tract 3:

  	
  A part of Lot Two (2), Block Six (6), City of Albany, Missouri,
  described as beginning at a point 22 feet South of the Northeast corner of
  Lot Two (2), thence West 93 feet, thence South 22 feet, thence East 93 feet,
  thence North 22 feet to the place of beginning.

  
	
   

  	
   

  
	
  Tract 4:

  	
  Lot Five (5), Block Six (6), City of Albany, Gentry County, Missouri.

  
	
   

  	
   

  
	
  Tract 5:

  	
  The East 45 feet of Lot Six (6), Block Six (6), City of Albany,
  Gentry County, Missouri.

  
	
   

  	
   

  
	
  Tract 6:

  	
  Beginning at a point 44 feet South of the Northwest corner of Lot Two
  (2), Block Six (6) of the original City of Albany, Missouri, thence
  North along the East side of the platted alley to the Northwest corner of Lot
  Three (3) of said Block Six (6), thence West 12 feet to the Northeast
  corner of Lot Six (6) of said Block Six (6), thence South along the West
  side of the platted alley to a point 44 feet South of the Northeast corner of
  Lot Five (5) of said Block Six (6), being a point due West of the place
  of beginning, thence East to beginning, including all of the platted alley
  lying North of a line beginning 44 feet South of the Northeast corner of Lot
  Five (5) and extending East across said alley to a point 44 feet South
  of the Northwest corner of Lot Two (2) all in Block Six (6) of the
  original City of Albany, Gentry County, Missouri.

  

 

Tax
ID No. 07-06-24-04-01-75

 

 

LEGAL DESCRIPTION

 

Commencing
at the East Quarter corner of the Section 15, Township 63 North, Range 28
West, Harrison County, Missouri; thence along Quarter section line, North
89 degrees 31 minutes 09 seconds West 44.89 feet to the Westerly right-of-way
of Highway 136 and the point of beginning; thence along said right-of-way South
00 degrees 21 minutes 25 seconds West 85.0 feet; thence along a line 85 feet
South of and parallel to said Quarter section line, North 89 degrees 31
minutes 09 seconds West 342.18 feet; thence along the East line of Grand View
Heights Addition, North 00 degrees 08 minutes 32 seconds West 451.09 feet to
the Northeast corner of Lot One (1) of said Addition; thence South 88
degrees 27 minutes 00 seconds East 346.19 feet to the Westerly right-of-way of
Highway 136; thence along said right-of-way South 00 degrees 21 minutes 25
seconds West 359.60 feet to the point of beginning.

 

Tax
I.D.:  19-5.1-15-1-21-1

 

 

LEGAL DESCRIPTION

 

All
of Lots One (1) and Two (2) in Block Four (4) West and One (1) South,
the North half (N 1/2) of Lots Three (3) and Four (4) in Block Four (4) West
and One (1) South, and, the East half (E 1/2) of the South half (S 1/2) of
Lot Three (3) in Block Four (4) West and One (1) South, all in
the City of Gallatin, Daviess County, Missouri, this last tract is also
described as beginning at the Southeast corner of said Lot Three (3), thence
North 65 feet, thence West 30 feet, thence South 65 feet, thence East 30 feet
to the place of beginning.

 

Tax
I.D.:  15-4.2-20-2-07-01

 

 

LEGAL DESCRIPTION

 

The land referred to is situated in the State of Missouri,
County of Scotland and is described as follows:

 

A tract of land lying in part of Lot 1 of the
Southwest Quarter of Fractional Section 7, Township 65, Range 11, and
being more fully described as follows, to-wit: from the Southwest corner of Lot
1 of the Southwest Quarter of said Fractional Section 7 run South 89° 41’
48” East along the South line of said Fractional Section 7 a distance of
540 feet to the Southwest corner of Missouri State Highway Department Property
as recorded in Book 212 at Page 351, thence North 00° 25’ 41” West along
the West line of said Highway Department Property 223.3 feet to the Northwest
corner of said Highway Department Property and the true point of beginning,
thence continue North 00° 25’ 41” West 316.11 feet, thence South 89° 25’ East
and parallel with the South line of U.S. Highway No. 136 a distance of
500.00 feet, thence North 00° 22’ 31” East 180.00 feet to the South line of
U.S. Highway No. 136, thence South 89° 25’ East along said South line
178.56 feet, thence South 44° 29’ 22” East along said South line 106.43 feet to
the West line of Missouri State Route M, thence South 00° 18’ 41” West along
said West line 417.22 feet to the North line of said Missouri State Highway
Department Property, thence North 89° 41’ 52” West along the North line of said
Highway Department Property 749.67 feet to the true point of beginning. Except
a tract of land lying in part of Lot 1 of the Southwest Quarter of
Fractional Section 7, Township 65, Range 11, Scotland County, Missouri,
and being more fully described as follows, to-wit: from the Southwest corner of
Lot 1 of the Southwest Quarter of said Fractional Section 7; thence South
89° 41’ and 48” East along the South line of said Fractional Section 7 a
distance of 540 feet to the Southwest corner of Missouri State Highway
Department property as recorded in Book 212 at Page 351; thence North 00°
25’ and 41” West along the West line of said Highway Department property 223.3
feet to the Northwest corner of said Highway Department property; thence South
89° 41’ and 52” East along the North line of said Highway Department Property
749.67 feet to the West right-of-way of Missouri State Route “M”, thence North
00° 18’ and 41” East along said West right-of-way 293.10 feet; thence North 89°
41’ and 19” West 10.00 feet to the Southeast corner of a proposed building and
the true point of beginning of the herein described tract of land; thence
continue North 89° 41’ and 19” West 100.33 feet, thence North 00° 18’ and 41”
East 40.00 feet; thence North 89° 41’ and 19” West 10.00 feet; thence North 00°
18’ and 41” East 40.00 feet; thence South 89° 41’ and 19” East 10.00 feet;
thence North 00° 18’ and 41” East 40.00 feet; thence South 89° 41’ and 19” East
65.33 feet; thence North 00° 18’ and 41” East 10.00 feet; thence South 89° 41’
and 19” East 20.00 feet; thence South 00° 18’ and 41” West 10.00 feet; thence
South 89° 41’ and 19” East 15.00 feet; thence South 00° 18’ and 41” West 120.00
feet to the true point of beginning.

 

Also excepting, a tract of land lying in part of
Lot 1 of the Southwest corner of Fractional 7, Township 65, Range 11 and being
more fully described as follows, to-wit: from the Southwest corner of Lot 1 of
the Southwest Quarter of said Fractional Section 7, run South 89° 41’ 48”
East along the South line of said Fractional Section 7 a distance of 540
feet to the Southwest corner of Missouri State Highway Department property as
recorded in Book 212 at Page 351 of the Scotland County Deed Records,
thence North 00° 25’ 41” West along the West line of said Highway

 

 

Department property 223.3 feet to the Southwest
corner of said Missouri Highway Department property; thence North 00° 25’ 41”
West a distance of 47.39 feet to true point of beginning of the description
herein, thence North 00° 25’ 41” West a distance of 208.72 feet; thence South
89° 25’ East a distance of 208.72 feet; thence South 00° 25’ 41” East a
distance of 208.72 feet; thence North 89° 25’ West a distance of 208.72 feet;
thence North 89° 25’ West a distance of 208.72 feet to the point of beginning.

 

Also excepting, a tract of land situated in part of
Lot 1 of the Southwest Quarter of Fractional Section 7, Township 65 North,
Range 11 West, Scotland County, Missouri and being more particularly described
as follows:

 

Commencing at the Southwest corner of Lot 1 of the
Southwest Quarter of said Fractional Section 7; thence along the Section line,
South 89°41’42” East, a distance of 540.00 feet to the Southwest corner of
Missouri State Highway Department property as recorded in Book 212 at Page 351
of the Scotland County records; thence leaving the last described line, North
0°25’41” West, a distance of 223.30 feet to the Northwest corner of said
Highway Department property, said point being the POINT OF BEGINNING of the
description herein; TO WIT: thence continuing North along said line, a distance
of 47.39 feet; thence South 89°25’00” East, a distance of 208.72 feet; thence
North 0°25’41” West, a distance of 208.72 feet; thence North 89°25’00” West, a
distance of 208.72 feet; thence North 0°25’41” West, a distance of 60.00 feet;
thence South 89°25’00” East, a distance of 380.00 feet; thence South 0°22’51”
West, a distance of 164.29 feet; thence South 89°25’00” East, a distance of
84.34 feet; thence South 0°22’51” West, a distance of 149.51 feet; thence North
89°41’52” West, a distance of 459.88 feet to the point of beginning; said
described tract containing 2.0 acres, more or less. Subject to any and all
easements of record.

 

Parcel
#2-10-03.2-07-04.2-05-01.000

 

 

LEGAL DESCRIPTION

 

Lots
5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15 and 16 in Cross Centre Addition to the
City of Burlington, Coffey County, Kansas.

 

Together
with non-exclusive easement rights created by Declaration of Cross-Easements
and Covenants and Restrictions Affecting Land, dated January 27, 2006, and
recorded immediately prior hereto.

 

Tax
ID No. 07707

 

 

LEGAL DESCRIPTION

 

The
South 450 feet of the East 633 feet of the Southeast 1/4 of the Southwest 1/4
of Section 36, Township 92 North, Range 25 West of the Fifth Principal
Meridian, Wright County, Iowa, Except the East 333 feet thereof.

 

Together
with non-exclusive easement rights created by Easement Agreement recorded June 20,
1991 in book L at page 92.

 

Tax
Parcel Number: 472-01-43-03-05-0000

 

 

LEGAL DESCRIPTION

 

Lots
One Hundred Forty-five (145) and One Hundred Forty-six (146) in the Original
Plat of the Town of Mount Ayr, Ringgold County, Iowa.

 

Together
with a the non-exclusive easement created by Agreement for Easement made by and
between P.M. Places Stores Company, and the City of Mt. Ayr recorded April 21,
1995 in book 259 at page 179.

 

Tax
Parcel Number: 0063742

 

 

LEGAL DESCRIPTION

 

Lot
1, Pamida F Street, an Addition to the City of Omaha, Douglas County, Nebraska.

 

TAX
I.D.:  3537-2020-19-62-6600

 

 

 

EXHIBIT A-4

 

INTENTIONALLY DELETED

 

A-4-1

 

EXHIBIT B

 

LIMITED RENT DETERMINATION/ADJUSTMENT FORMULA

 

1.             Determination
relating to Assignment or Subleasing.

 

Tenant has a
limited collective ability to assign and sublease a portion of the aggregate
square footage of real estate subject to the Lease. For square footage that is
either sublet with a corresponding non-disturbance agreement or which is
assigned in accordance with Article 12, Tenant will seek to obtain
initial rents at market rates, but in no event less than a determined minimum (“Determined
Minimum”). The Determined Minimum rents for individual Property Locations
shall be computed by multiplying (a) a fraction (the “Quotient”),
the numerator of which will be the allocated loan amount assigned to the
particular Property Location as set forth in a loan agreement between Landlord
and Landlord’s Mortgagee and the denominator of which will be the Total Loan
Amount, by (b) the current Base Rent payment.

 

2.             Adjustments
relating to Casualty or Condemnation.

 

Upon (a) a Casualty Event which results
in the removal of a Property Location in accordance with Article 14
of this Lease, or (b) a Condemnation which results in the removal of a
taken Property Location in accordance with Article 15 of this
Lease, the Base Rent hereunder shall be reduced by the product resulting from
multiplying (i) the Quotient (defined above), by (ii) the current
Base Rent payment.

 

As applicable to Sections 1 and 2 of
this Exhibit B, the “Total Loan Amount” shall mean the
combined sum of all of the allocated loan amounts assigned to all of the
Property Locations under this Lease as set forth in the loan agreement as
obtained or modified by Landlord’s existing or future Mortgagees from time to
time (the “Allocated Loan Amounts”). The Allocated Loan Amounts shall be
subject to change after the Effective Date upon sixty (60) days prior written
notice to Tenant if Landlord refinances or modifies the loan secured by the
Premises with an unaffiliated third party Mortgagee (with such refinancing or
modification not to occur more than once every three (3) years); such
Allocated Loan Amounts may change based solely on a change in the fair
market value of the Property Locations established by new appraisals to the
extent such Mortgagee requires new appraisals to determine the then-current
Allocated Loan Amount. If such Allocated Loan Amounts change, Landlord shall
promptly notify Tenant of the revised Allocated Loan Amounts. If no new
Allocated Loan Amounts are required by any new Mortgagees, Landlord and Tenant
shall rely on the Allocated Loan Amounts in effect as of the Effective Date.

 

B-1

 

EXHIBIT C

 

FORM OF ESTOPPEL LETTER

 

TO:

 

Re:          Leasehold
interest in property located at
                                            
(the “Property”) pursuant to a Lease dated
                                    
(the “Lease”) between
                                                
(“Landlord”) and
                        
(“Tenant”)

 

Ladies and Gentlemen:

 

The following
statements are made for your benefit and the benefit of your Mortgagees,
successors, and assigns (the “Beneficiaries”). The undersigned hereby certifies
to the Beneficiaries that the following statements are true, correct and
complete as of the date hereof:

 

1.             The
Lease is unmodified and is presently in full force and effect and represents
the entire agreement between Tenant and Landlord with respect to the Property.

 

2.             Tenant
began paying rent under the Lease on
                                    .
Tenant is currently paying
$                      
per month as rent and
$                      
for other charges under the Lease.

 

3.             Neither
Landlord nor Tenant is in default under the Lease. To the knowledge of the
undersigned, no event has occurred that with the giving of notice, the passage
of time, or both, would constitute a default under the Lease.

 

4.             The
leased premises have been completed in accordance with the terms of the Lease
and Tenant is in occupancy, open for business and paying rent on a current
basis with no rental offsets or claims.

 

5.             Tenant
has not prepaid rent other than as provided for in the Lease or as stated
above.

 

6.             There
are no actions, whether voluntary or otherwise, pending against the undersigned
under the bankruptcy laws of the United States or any State thereof.

 

7.             The
Lease has not been assigned nor has the Property been sublet.

 

8.             Tenant
has no existing defenses, offsets, liens, claims or credits against the payment
obligations under the Lease.

 

9.             The
expiration date of the Lease is
                                    
(the “Expiration Date”). Tenant has not been granted any options or rights to
terminate the Lease earlier than the Expiration Date.

 

C-1

 

10.           Tenant
is currently not a party to any lease or sublease affecting the Property, other
than the Lease.

 

EXECUTED as of
the        day of
                              .

 

 

	
  [

  	
  ]

  
	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
						

 

C-2

 

EXHIBIT D

 

FORM OF SUBLEASE NON-DISTURBANCE
AGREEMENT

 

SUBLEASE
RECOGNITION AGREEMENT

 

THIS SUBLEASE
RECOGNITION AGREEMENT (“Agreement”), made as
of                                             ,
20     , by and
between                                                                                       ,
a                                                         (“Landlord”)
and                                                                                                                           ,
a                                                            (“Subtenant”).

 

R
E  C  I  T  A  L  S:

 

A.            Landlord
and
                                              
(“Tenant”) have entered into a certain lease (the “Lease”) dated
as
of                                  ,
2006, a memorandum of which has been recorded in the Recorder of Deeds Office
in and for
                                    
County,
                                  ,
which demises certain real property (the “Property Location”) located at
                                        
(the “Property Location”), which Property Location is more particularly
described on Exhibit “A” attached hereto and made a part hereof.

 

B.            Pursuant
to a Sublease dated as of                                         ,
20       (the “Sublease”), Tenant has
leased to
Subtenant                                             of
the Property Location (the “Subleased Property Location”), and which
Subleased Location is more particularly described in the Sublease.

 

C.            The
parties hereto desire to effectuate the provisions of Section 12.03 of the
Lease with respect to the Sublease and the Subleased Property Location.

 

NOW, THEREFORE, in consideration of the
mutual covenants and agreements herein contained, the parties hereto, intending
to be legally bound hereby, agree as follows:

 

1.             Landlord
warrants and represents as follows:

 

a.             that
it is the fee owner of the Property Location;

 

b.             that
the Lease is unmodified (except as may be otherwise set forth in Exhibit B
annexed hereto, if any) and is in full force and effect;

 

c.             that
the term of the Lease expires
on                                        ,
but is subject
to                    extension
periods of             
(    ) years each; and

 

d.             that
Tenant is not in default under the Lease nor has any event occurred which would
after notice to Tenant and the passage of time become a default of Tenant under
the Lease.

 

D-1

 

2.             Landlord
hereby acknowledges receipt of a copy of the Sublease, and agrees the exercise
by Subtenant of any of its rights, remedies and options contained therein shall
not constitute a default under the Lease.

 

3.             Landlord
shall not, in the exercise of any of the rights arising or which may arise
out of the Lease or of any instrument modifying or amending the same or entered
into in substitution or replacement thereof (whether as a result of Tenant’s
default or otherwise), disturb or deprive Subtenant in or of its possession or
its rights to possession of the Subleased Property Location or of any right or
privilege granted to or inuring to the benefit of Subtenant under the Sublease,
provided that Subtenant is not in default under the Sublease beyond the
expiration of any applicable notice and cure period.

 

4.             In
the event of the termination of the Lease by reentry, notice, conditional
limitation, surrender, summary proceeding or other action or proceeding, or
otherwise, or, if the Lease shall terminate or expire for any reason before any
of the dates provided in the Sublease for the termination of the initial or
renewal terms of the Sublease and if immediately prior to such surrender,
termination or expiration the Sublease shall be in full force and effect,
Subtenant shall not be made a party in any removal or eviction action or
proceeding nor shall Subtenant be evicted or removed of its possession or its
right of possession of the Subleased Property Location be disturbed or in any
way interfered with, and the Sublease shall continue in full force and effect
as a direct lease between Landlord and Subtenant.

 

5.             Landlord
hereby waives and relinquishes any and all rights or remedies against
Subtenant, pursuant to any lien, statutory or otherwise, that it may have
against the property, goods or chattels of Subtenant in or on the Subleased
Property Location.

 

6.             Any
notices, consents, approvals, submissions, demands or other communications
(hereinafter collectively referred to as “Notice”) given under this
Agreement shall be in writing, and may be given or be served by hand
delivered personal service, or by depositing the same with a reliable overnight
courier service or by deposit in the United States mail, postpaid, registered
or certified mail, and addressed to the party to be notified, with return
receipt requested. Notice shall be effective upon actual receipt or refusal to
accept delivery. For purposes of notice, the addresses of the parties shall,
until changed as herein provided, be as follows:

 

If to the Landlord, at:

 

	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Attention:

  	
   

  	
   

  
			

 

If to the Subtenant, at:

 

	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Attention:

  	
   

  	
   

  
			

 

D-2

 

If to the Tenant:

 

	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Attention:

  	
   

  	
   

  
			

 

with a copy to:

 

	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Attention:

  	
   

  	
   

  
			

 

7.             No
modification, amendment, waiver or release of any provision of this Agreement
or of any right, obligation, claim or cause of action arising hereunder shall
be valid or binding for any purpose whatsoever unless in writing and duly
executed by the party against whom the same is sought to be asserted.

 

8.             This
Agreement shall be binding on and shall inure to the benefit of the parties
hereto and their respective heirs, legal representatives, successors, assigns
and sublessees.

 

[THIS SPACE INTENTIONALLY LEFT
BLANK]

 

D-3

 

IN WITNESS WHEREOF, the parties have caused
this Agreement to be executed under seal the date first above written.

 

WITNESS/ATTEST:

 

	
   

  	
  LANDLORD:

  
	
   

  	
   

  
	
   

  	
   

  	
  , a

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  SUBTENANT:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  , a

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
							

 

TENANT’S
CONSENT

 

Tenant
consents and agrees to the foregoing Agreement, which was entered into at
Tenant’s request. The foregoing Agreement shall not alter, waive or diminish
any of Tenant’s obligations under the Lease or Sublease. Tenant is not a party
to the above Agreement.

 

	
   

  	
  TENANT:

  
	
   

  	
   

  
	
   

  	
   

  	
  , a

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
							

 

D-4

 

LIST
OF EXHIBITS

 

If any exhibit is not attached hereto at
the time of execution of this Agreement, it may thereafter be attached by
written agreement of the parties, evidenced by initialing said exhibit.

 

Exhibit “A”            -               Legal
Description of the Property Location

 

D-5

 

LANDLORD’S
ACKNOWLEDGMENT

 

	
  STATE OF

  	
   

  	
  :

  
	
   

  	
  :           SS

  
	
  COUNTY OF

  	
   

  	
  :

  
				

 

On this,
the      day
of                                               ,
20      , before me a Notary Public in and for
the State and County noted above, the undersigned officer, personally
appeared                            ,
who acknowledged that he/she is
the                                                                                          of                                                                                                ,
a                                                                        ,
and that he/she, being authorized to do so, executed the foregoing instrument
for the purposes therein contained by signing the name of the company by himself/herself
as such officer.

 

In witness whereof, I hereunto set my hand
and official seal.

 

	
   

  	
   

  	
  [Seal]

  
	
   

  	
  Notary Public

  

 

My Commission Expires:

 

, 200   

 

D-6

 

SUBTENANT’S
ACKNOWLEDGMENT

 

	
  STATE OF

  	
   

  	
  :

  
	
   

  	
  :           SS

  
	
  COUNTY OF

  	
   

  	
  :

  
				

 

On this, the           day
of                                               ,
20      , before me a Notary Public in and for
the State and County noted above, the undersigned officer, personally
appeared                                      ,
who acknowledged that he/she
is                                                          of                                                                                                                      ,
a                                                                            ,
and that he/she, being authorized to do so, executed the foregoing instrument
for the purposes therein contained by signing the name of the company by
himself/herself as such officer.

 

In witness whereof, I hereunto set my hand
and official seal.

 

	
   

  	
   

  	
  [Seal]

  
	
   

  	
  Notary Public

  

 

My Commission Expires:

 

, 200    

 

D-7

 

EXHIBIT E

 

FORM OF MORTGAGEE NON-DISTURBANCE
AGREEMENT

 

 

	
   

  	
   

  	
   

  
	
   

  	
  (Lender)

  
				

 

 

- and -

 

 

	
   

  	
   

  	
   

  
	
   

  	
  (Tenant)

  
				

 

 

SUBORDINATION, NON-DISTURBANCE AND

ATTORNMENT AGREEMENT

 

	
  Dated:

  	
  As of

  	
   

  

 

	
  PREPARED BY AND UPON

  
	
  RECORDATION RETURN TO:

  
	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

E-1

 

THIS
SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT
AGREEMENT (this “Agreement”)
is made as of the        day of
                                              ,
2006, by and between                                               ,
a
                                              ,
having its principal place of business at
                                              
(together with its successors and/or assigns, “Lender”) and
                                              ,
a
                                              
having an address at
                                                      
“Tenant”).

 

RECITALS:

 

A.            Lender has advanced a
loan to
                                    ,
a                                   
                            
(“Borrower”) in the principal sum
of
                                                      
DOLLARS
($                                )
(the “Loan”) advanced pursuant to
that certain Loan Agreement of even date herewith between Borrower and Lender
(together with all extensions, renewals, modifications, substitutions and
amendments thereof, the “Loan Agreement”).

 

B.            The Loan is secured
by, among other things, the Security Instrument (as defined in the Loan
Agreement) which grants Lender a first lien on the Properties (as defined in
the Loan Agreement) encumbered thereby and is further evidenced by the Note (as
defined in the Loan Agreement).

 

C.            Borrower has entered
into a certain Lease Agreement dated as of the date hereof (the “Lease”) with Tenant, which Lease relates to
the Properties.

 

D.            Tenant has agreed to
confirm the subordination of the Lease to the Security Instrument and to the
liens thereof on the terms and conditions hereinafter set forth.

 

AGREEMENT:

 

For good and valuable consideration, Tenant and Lender agree as
follows:

 

1.             Subordination. The Lease is and
shall at all times be subject and subordinate in all respects to the terms,
covenants and provisions of the Security Instrument and to the liens thereof,
including without limitation, all renewals, increases, modifications,
spreaders, consolidations, replacements and extensions thereof and to all sums
secured thereby and advances made thereunder with the same force and effect as
if the Security Instrument had been executed, delivered and recorded prior to
the execution and delivery of the Lease.

 

2.             Non-Disturbance and Attornment. If
Lender or any other subsequent purchaser of the Properties shall become the
owner of the Properties by reason of the foreclosure of the Security Instrument
or the acceptance of a deed or assignment in lieu of foreclosure or by reason
of any other enforcement of the Security Instrument (Lender or such other
purchaser being hereinafter referred as “Purchaser”),
provided no event of default exists under the Lease, (a) Purchaser shall
not (i) disturb Tenant’s possession of the Properties nor (ii) name Tenant as a party to any foreclosure or other
proceeding to enforce the terms of the Security Instrument and (b) any
sale or other transfer of the Properties or of Borrower’s interest in the
Lease, pursuant to foreclosure of the Security Instrument or the acceptance of
a deed or assignment in lieu of foreclosure or by reason of any other
enforcement of the Security Instrument, will be subject and

 

E-2

 

subordinate to Tenant’s
possession and rights under the Lease; and (c) the Lease shall not
be terminated or affected thereby but shall continue in full force and effect
as a direct lease between Purchaser and Tenant upon all of the terms, covenants
and conditions set forth in the Lease and in that event, Tenant agrees to
attorn to Purchaser and Purchaser by virtue of such acquisition of the
Properties shall be deemed to have agreed to accept such attornment, provided,
however, that Purchaser shall not be (i) liable for the failure of any
prior landlord (any such prior landlord, including Borrower and any successor
landlord, being hereinafter referred to as a “Prior
Landlord”) to perform any of its obligations under the Lease
which have accrued prior to the date on which Purchaser shall become the owner
of the Properties; (ii) subject to any offsets, defenses, abatements or
counterclaims which shall have accrued in favor of Tenant against any Prior
Landlord prior to the date upon which Purchaser shall become the owner of the
Properties;  (iii) liable for the
return of rental security deposits, if any, paid by Tenant to any Prior
Landlord in accordance with the Lease unless such sums are actually received by
Purchaser; (iv) bound by any payment of rents, additional rents or other
sums which Tenant may have paid more than one (1) month in advance to
any Prior Landlord unless such sums are actually received by Purchaser; (v) bound
by any modification or amendment of the Lease, or any waiver of the terms of
the Lease, made without Lender’s written consent; or (vi) any consensual
or negotiated surrender, cancellation, or termination of the Lease, in whole or
in part, agreed upon between Borrower and Tenant, unless effected unilaterally
by Tenant pursuant to the express terms of the Lease. Notwithstanding anything
to the contrary contained in this Agreement, in the case of clauses (i) and
(ii) herein, the foregoing shall not limit either (1) Tenant’s right
to exercise any offsets, defenses, claims, reductions, deductions or abatements
otherwise available to Tenant because of events occurring before or after the
date of attornment to the extent Lender has received notice thereof and the
opportunity to cure within the time periods set forth in this Agreement (it
being further agreed that offsets, reductions, deductions or abatements under
the Lease that were deducted by Tenant prior to the date upon which Purchaser
succeeds to the interest of Prior Landlord shall not be subject to challenge),
or (2) Purchaser’s
liability for any defaults that continue after the date of attornment that
violate Purchaser’s obligations as landlord under the Lease. In the
event that any liability of Purchaser does arise pursuant to this Agreement,
such liability shall be limited and restricted to Purchaser’s interest in the
Properties and shall in no event exceed such interest.

 

3.             Notices.
All notices required or permitted hereunder shall be given and become effective
as provided in Loan Agreement. Notices to the Tenant shall be addressed as
follows:

 

	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Attention:

  	
   

  	
   

  
	
  Facsimile No.:

  	
   

  	
   

  
				

 

and

 

	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Attention:

  	
   

  	
   

  
	
  Facsimile No.:

  	
   

  	
   

  
				

 

E-3

 

 

4.                                      Lender’s
Right of Access. Tenant agrees that Lender shall have the rights of
access to the Properties for the purpose of curing a default under the Lease as
granted to Borrower pursuant to the terms of the Lease and Lender agrees not to
disturb the normal business operations of Tenant at such Properties in
connection therewith.

 

5.                                      Notice
to Lender. Notwithstanding anything to the contrary in the Lease or
this Agreement, before exercising any offset right or termination right, Tenant
agrees that it shall deliver to Lender a copy of any written notice of the
breach or default by Borrower giving rise to same (the “Default Notice”), and, thereafter, the
opportunity to cure such breach or default as provided for below.

 

6.                                      Cure.
After Lender receives a Default Notice, Lender shall have a period of thirty
(30) days beyond the time available to Landlord under the Lease in which to
cure the breach or default by Borrower. Lender shall have no obligation to cure
(and shall have no liability or obligation for not curing) any breach or
default by Borrower, except to the extent that Lender agrees or undertakes
otherwise in writing. In addition, as to any breach or default by Lender the
cure of which requires possession and control of a Property, provided that
Lender undertakes by written notice to Tenant to exercise reasonable efforts to
cure or cause to be cured by a receiver such breach or default within the
period permitted by this paragraph, Lender’s cure period shall continue for
such additional time (the “Extended Cure
Period”) as Lender may reasonably require to either: (a) obtain
possession and control of the applicable Property with due diligence and
thereafter cure the breach or default with reasonable diligence and continuity;
or (b) obtain the appointment of a receiver and give such receiver a
reasonable period of time in which to cure the default.

 

7.                                      Proceeds and Awards. Provided
that Tenant is not in default under the terms of the Lease (beyond any
applicable cure periods), Lender agrees that, notwithstanding any provision
hereof to the contrary, the terms of the Lease shall continue to govern with
respect to the disposition of any insurance proceeds or eminent domain awards.

 

8.                                      Successors
and Assigns. This Agreement shall be binding upon and inure to the
benefit of Lender, Tenant and Purchaser and their respective successors and
assigns.

 

9.                                      Governing
Law. This Agreement shall be deemed to be a contract entered into
pursuant to the laws of the State of
                                              and
shall in all respects be governed, construed, applied and enforced in
accordance with the laws of the State of
                                              .

 

10.                               Miscellaneous.
This Agreement may not be modified in any manner or terminated except by
an instrument in writing executed by the parties hereto. If any term, covenant
or condition of this Agreement is held to be invalid, illegal or unenforceable
in any respect, this Agreement shall be construed without such provision. This
Agreement may be executed in any number of duplicate originals and each
duplicate original shall be deemed to be an original. This Agreement may be
executed in several counterparts, each of which

 

E-4

 

counterparts shall be deemed an original
instrument and all of which together shall constitute a single Agreement. The
failure of any party hereto to execute this Agreement, or any counterpart hereof,
shall not relieve the other signatories from their obligations hereunder.
Whenever the context may require, any pronouns used herein shall include
the corresponding masculine, feminine or neuter forms, and the singular form of
nouns and pronouns shall include the plural and vice versa.

 

[NO FURTHER TEXT ON
THIS PAGE]

 

E-5

 

IN WITNESS WHEREOF, Lender and Tenant have duly executed this Agreement
as of the date first above written.

 

 

	
   

  	
  [INSERT LENDER SIGNATURE BLOCK]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [INSERT TENANT SIGNATURE BOCK]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

THE
UNDERSIGNED ACCEPTS AND AGREES TO

THE PROVISIONS HEREOF:

 

	
  [INSERT LANDLORD SIGNATURE

  	
   

  
	
  BLOCK]

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
				

 

ACKNOWLEDGEMENTS

 

(To Be Attached)

 

E-6

 

EXHIBIT F

 

FORM OF LANDLORD AGREEMENT

 

LANDLORD
AGREEMENT

 

Wachovia Bank, National Association, in its
capacity as agent pursuant to the Loan Agreement (as defined below) acting for
and on behalf of the parties thereto as lenders (in such capacity, together
with its successors and assigns, “Agent”) and the parties to the Loan Agreement
as lenders (collectively, together with their respective successors and
assigns, “Lenders”) have entered or are about to enter into financing
arrangements with
                            
(“Debtor”) pursuant to which Agent has been granted a security interest in all
of Debtor’s and certain of its affiliates’ inventory and other personal
property (hereinafter “Personal Property”). For purposes of this Agreement, the
term “Personal Property” does not include plumbing and electrical fixtures,
heating, ventilation and air conditioning, wall and floor coverings, walls or
ceilings and other fixtures not constituting trade fixtures. Some of the Personal
Property has or may from time to time become affixed to or be located on,
wholly or in part, the real property leased by Debtor or its affiliates located
at the addresses listed on Exhibit A attached hereto (collectively, the “Premises”).
                     
(“Landlord”) is the owner or lessor of the Premises. The term “Loan Agreement”
as used herein shall mean the Loan and Security Agreement by and among Debtor,
certain of its affiliates, Agent and Lenders, as the same now exists or may hereafter
be amended, modified, supplemented, extended, renewed, restated or replaced.

 

In order for Agent and Lenders to consider
making loans or providing other financial accommodations to Debtor or its
affiliates in reliance upon the Personal Property as collateral, the
undersigned agree as follows:

 

1. Landlord waives and relinquishes any
landlord’s lien, rights of levy or distraint, claim, security interest or other
interest Landlord may now or hereafter have in or with respect to any of
the Personal Property, whether for rent or otherwise.

 

2. Except as otherwise provided in the lease
relating to the Premises between Landlord and Debtor as in effect on the date
hereof (the “Lease”), the Personal Property may be installed in or located
on the Premises and is not and shall not be deemed a fixture or part of
the real property but shall at all times be considered personal property.

 

3. Agent, at its option, for itself and for
the benefit of Lenders, may enter and use the Premises for the purpose of
repossessing, removing, selling or otherwise dealing with any of the Personal
Property, and such license shall be irrevocable and shall commence on the date
(the “Access Commencement Date”) which is the earlier of (w) five (5) business
days following Landlord’s receipt of written notice from Agent that Agent
intends to enter the Premises pursuant to the rights granted to Agent hereunder
or (x) five (5) business days following Agent’s receipt of written notice
from Landlord that the Lease has terminated in accordance with Section 4
hereof, and such license shall expire on the date (the “Access Termination Date”)
that is ninety

 

F-1

 

(90) days after the Access Commencement Date; provided, that,
(a) for each day from the Access Commencement Date through the earlier of
the Access Termination Date or the date on which Agent notifies Landlord in
writing that Agent will not be or will no longer be using the Premises pursuant
to the rights granted to it hereunder, Agent shall (i) maintain or cause
to be maintained such insurance as is required by the Debtor to be maintained
as provided under the Lease, (ii) unless Landlord has otherwise been paid
rent in respect of any such period, Agent shall pay the regularly scheduled
rent (prorated on a per diem basis to be determined on a thirty (30) day month)
without thereby assuming the Lease or incurring any other Obligations of Debtor
and, (iii) without duplication of the payments under clause (ii) above,
pay or cause to be paid all utilities costs attributable to the Premises in
accordance with the terms and provisions of the Lease, without thereby assuming
the Lease or incurring any other obligations of Debtor, (b) any damage to
the Premises caused by Agent or its representatives will be repaired by Agent
at the sole expense of Lenders, (c) Agent agrees to indemnify, defend and
hold Landlord harmless from and against any and all damages, losses, claims,
judgments, liabilities, costs and expense (including reasonable attorneys’ fees
and expenses) resulting or arising from the activities of Agent on the
Premises, except for those damages, losses, claims, judgments, liabilities,
costs and expense caused by the gross negligence or willful misconduct of
Landlord, and (d) Landlord shall be entitled to inspect the Premises and
to show the Premises to prospective tenants and purchasers from time to time.

 

4. Landlord agrees to send notice in writing
of any termination of, or default under, or abandonment or surrender under
(which constitute a default under the Lease) the Lease to:

 

Wachovia Bank, National Association, as Agent

Heritage Square II, Suite 1050

5001 LBJ Freeway

Dallas, Texas 75244

Attention:  Portfolio Manager

Telephone No.:  (214) 761-9044

Telecopy No.:  (214) 748-9118

 

Agent shall have the right, but not the obligation, to cure any default
by Debtor under the Lease in the manner and time period provided in the Lease.
Any payment made or act done by Agent to cure any such default shall not
constitute an assumption of the Lease or any obligations of Debtor. Any notice
required to be to Agent hereunder shall be directed to Agent at the address set
forth above in this Section 4 or such other address as Agent notifies
Landlord in writing.

 

5. This Agreement may not be changed or
terminated orally or by course of conduct. Landlord shall notify any purchaser
of the Premises or of its business of this Agreement and its terms. This
Agreement is binding upon, and inures to the benefit of, Landlord, Debtor and
Agent and their respective successors and assigns.

 

6. Any notice required to be given to
Landlord hereunder shall be directed to Landlord at the address set forth under
Landlord’s signature below or such other address as Landlord notifies Agent in
writing.

 

F-2

 

7. Entry by Agent or its agents or
representatives upon the Premises shall not be deemed an eviction or a
disturbance of Debtor’s use and possession of the Premises or any part thereof,
or render Landlord liable to Debtor for damages or abatement of rent or relieve
Debtor from the responsibility of performing any of Debtor’s obligations under
the Lease, and Debtor shall have no right or claim against Landlord for or by
reason of any such entry or inspection or removal or attempted removal of the Personal
Property by Agent or its agents or representatives.

 

8. This Agreement shall be governed by and
construed in accordance with the laws of the States where the Premises are
located.

 

Dated this
         day of
                    ,
2006.

 

	
   

  	
  [NAME OF LANDLORD]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
								

 

	
  Agreed:

  
	
   

  
	
  [NAME OF DEBTOR]

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  
	
  WACHOVIA BANK, NATIONAL ASSOCIATION, as
  Agent

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  
	
  Title:

  	
   

  	
   

  
							

 

F-3

 

Exhibit A

 

Premises

 

1.

 

2.

 

3.

 

F-4

 

ACKNOWLEDGMENT
TO BE MADE BY LANDLORD

(INDIVIDUAL)

 

	
  STATE OF

  	
   

  
	
   

  	
  ss:

  
	
  COUNTY OF:

  	
   

  

 

I,
                                                                                          ,
a Notary Public within and for said County, in the State aforesaid, duly
commissioned and acting, do hereby certify that on this                                     
day of                                     ,
2006, personally appeared before me
                                                                                                            ,
the Landlord named in the foregoing Landlord Agreement, to me personally known
to be the person who signed said Landlord Agreement, who, being by me duly
sworn and being informed of the contents of said Landlord Agreement, stated and
acknowledged under oath that he signed, executed, sealed and delivered same as
his free and voluntary act and deed, for the uses, purposes and considerations
therein mentioned and set forth.

 

WITNESS my hand and seal as such Notary
Public the day and year in this certificate above written.

 

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  
				

 

F-5

 

LANDLORD
ACKNOWLEDGMENT

(PARTNERSHIP)

 

	
  STATE OF

  	
   

  
	
   

  	
  ss:

  
	
  COUNTY OF:

  	
   

  

 

I,                                                                                                                                                                 ,
a Notary Public within and for said County, in the State aforesaid, duly
commissioned and acting, do hereby certify that on
this                                                            day
of
                                             ,
2006, personally appeared before me                                                                     and
                                                                                                                 ,
the Landlord named in the foregoing Landlord Agreement, to me personally known
to be the person who signed said Landlord Agreement, stated and acknowledged
under oath that they are Partners of
                                                                               the
Partnership named in and which executed the said Landlord Agreement, and that
they signed, executed, sealed and delivered same individually and on behalf of
the said Partnership, with authority, as their and its free and voluntary act
and deed for the uses, purposes and considerations therein mentioned and set
forth.

 

WITNESS my hand and seal as such Notary
Public the day and year in this certificate above written.

 

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  
				

 

F-6

 

LANDLORD
ACKNOWLEDGMENT

(CORPORATION)

 

	
  STATE OF

  	
   

  
	
   

  	
  ss:

  
	
  COUNTY OF:

  	
   

  

 

I,                                                                                                                                   ,
a Notary Public within and for said County, in the State aforesaid, duly
commissioned and acting, do hereby certify that on
this                                             day
of                                    ,
2006, personally appeared before
me                                                                                                        
(Name of Signer for Landlord) to me personally known to be the person who
signed the foregoing Landlord Agreement, and who, being by me duly sworn and
being informed of the contents of said Landlord Agreement, stated and
acknowledged to me under oath that he is
                                                        
(Title) of
                                                                                                 
the Corporation named in and which executed the said Landlord Agreement, and
that same was signed, sealed, executed and delivered by him in the name of and
on behalf of the said Corporation by authority of its Board of Directors and
that the execution of said Landlord Agreement was his free and voluntary act
and deed in his said capacity and acknowledged to me that said Corporation
executed the same as its voluntary and was by him voluntarily executed, on
behalf of said Corporation for the uses, purposes and consideration therein
mentioned and set forth.

 

WITNESS my hand and seal as such Notary
Public the day and year in this certificate above written.

 

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  
				

 

F-7

 

DEBTOR
ACKNOWLEDGMENT

(CORPORATION)

 

	
  STATE OF

  	
   

  
	
   

  	
  ss:

  
	
  COUNTY OF:

  	
   

  

 

I,                                                                                                                         ,
a Notary Public within and for said County, in the State aforesaid, duly
commissioned and acting, do hereby certify that on
this                                               
day of                                        ,
2006, personally appeared before
me                                                                                                    
(Name of Signer for Debtor) to me personally known to be the person who signed
the foregoing Landlord Agreement, and who, being by me duly sworn and being
informed of the contents of said Landlord Agreement, stated and acknowledged to
me under oath that he is
                                                        
(Title) of                                                                                                  
the Corporation named in and which executed the said Landlord Agreement, and
that same was signed, sealed, executed and delivered by him in the name of and
on behalf of the said Corporation by authority of its Board of Directors and
that the execution of said Landlord Agreement was his free and voluntary act
and deed in his said capacity and acknowledged to me that said Corporation
executed the same as its voluntary and was by him voluntarily executed, on
behalf of said Corporation for the uses, purposes and consideration therein
mentioned and set forth.

 

WITNESS my hand and seal as such Notary
Public the day and year in this certificate above written.

 

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  
				

 

F-8

 

AGENT
ACKNOWLEDGMENT

 

	
  STATE OF

  	
   

  
	
   

  	
  ss:

  
	
  COUNTY OF:

  	
   

  

 

I,                                                                                                                      ,
a Notary Public within and for said County, in the State aforesaid, duly commissioned
and acting, do hereby certify that on this      day of
           2006, personally
appeared before
me                                                                                                        
(Name of Signer for Agent) to me personally known to be the person who signed
the foregoing Landlord Agreement, and who, being by me duly sworn and being
informed of the contents of said Landlord Agreement, stated and acknowledged to
me under oath that he is                                                         
(Title) of Wachovia Bank, National Association, the national association named
in and which executed the said Landlord Agreement, and that same was signed, sealed,
executed and delivered by him in the name of and on behalf of the said national
association by authority of its Board of Directors and that the execution of
said Landlord Agreement was his free and voluntary act and deed in his said
capacity and acknowledged to me that said national association executed the
same as its voluntary and was by him voluntarily executed, on behalf of said
national association for the uses, purposes and consideration therein mentioned
and set forth.

 

WITNESS my hand and seal as such Notary
Public the day and year in this certificate above written.

 

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  
				

 

F-9

 

EXHIBIT G

 

FORM OF MEMORANDUM OF LEASE

 

This Instrument Prepared By and Upon

Recordation return to:

Attention:

 

MEMORANDUM OF
LEASE

 

THIS
MEMORANDUM OF LEASE (“Memorandum”) made as of the
         day of
                                      ,
2006, by and between
                                                                        
(“Tenant”), and
                                                        ,
a(n)
                                        
(“Landlord”).

 

WITNESSETH:

 

1.                                       Premises. Landlord and Tenant have
entered into a lease (“Lease”) dated
                                    ,
20      , for that certain real property lying,
being and situate in the County of
                    ,
City of
                                ,
State of                           ,
more particularly described on EXHIBIT A attached hereto and made a
part hereof, together with the buildings and improvements located thereon
(the “Premises”).

 

2.                                       Term and Renewal Options. The Lease
has an initial term of fifteen (15) years, subject to extension (at Tenant’s
option) as provided therein for two (2) successive additional periods of
ten (10) years each.

 

3.                                       Incorporation of Lease. This
Memorandum is for informational purposes only and nothing contained herein
shall be deemed to in any way modify or otherwise affect any of the terms and
conditions of the Lease, the terms of which are incorporated herein by
reference. This instrument is merely a memorandum of the Lease and is subject
to all of the terms, provisions and conditions of the Lease. In the event of
any inconsistency between the terms of the Lease and this instrument, the terms
of the Lease shall prevail.

 

4.                                       Binding Effect. The rights and
obligations set forth herein shall be binding upon and inure to the benefit of
the parties hereto and their respective heirs, personal representatives,
successors and assigns.

 

IN WITNESS
WHEREOF, the parties have executed this Memorandum of
Lease as of the day and year first above written.

 

	
  Witnesses or Attest (as to Landlord):

  	
   

  	
  LANDLORD:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  a(n)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Print Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Print Title:

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  	
  , 20

  	
   

  	
   

  
												

 

G-1

 

	
  Witnesses or Attest (as to Tenant):

  	
   

  	
  TENANT:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Print Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Print Title:

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  	
  , 20

  	
   

  	
   

  
													

 

G-2

 

	
  STATE OF

  	
  )

  
	
   

  	
  )SS:

  
	
  COUNTY OF:

  	
  )

  

 

I, the
undersigned, a Notary Public in and for said County in said State, hereby certify
that 
                                                                ,
whose name as                                                    
of                                                  ,
a
                                              ,
is signed to the foregoing instrument, who is known to me, acknowledged before
me on this day that, being informed of the contents of the instrument, he, as
such officer and with full authority, executed the same voluntarily for and as
the act of said                                .

 

Given under my
hand and official seal this       day
of                                          ,
20

 

	
   

  	
   

  
	
   

  	
  Notary Public

  	
   

  
	
   

  	
  State of

  	
   

  
	
   

  	
  My Commission expires:

  	
   

  	
   

  
						

 

 

	
  STATE OF

  	
  )

  
	
   

  	
  )         SS:

  
	
  COUNTY OF:

  	
  )

  

 

I HEREBY
CERTIFY that on this day before me, an officer duly authorized in the state and
county named above to take acknowledgments, personally appeared
                                                    
as                                                   
of                                                   ,
a
                                      
, to me known to be the person who signed the foregoing instrument as such
officer and he/she acknowledged that the execution thereof was his/her free act
and deed as such officer for the use and purposes therein expressed and that
the instrument is the act and deed of said
                              .

 

WITNESS my
hand and official seal this       day
of                                          ,
20      .

 

G-3

 

EXHIBIT H

 

STATE SPECIFIC PROVISIONS

 

None.

 

H-1

 

EXHIBIT I

 

REQUIRED REPAIRS

 

I-1

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Immediate

  Repair Reserve

  Amount

  	
   

  
	
  Item

  	
   

  	
  Store #

  	
   

  	
  City

  	
   

  	
  St

  	
   

  	
  Short
  Description

  	
   

  	
  Additional
  Description

  	
   

  	
  Qty

  	
   

  	
  Unit of

  Measure

  	
   

  	
  Year 1

  2006

  	
   

  
	
   

  	
   

  	
  3007

  	
   

  	
  Mount Carmel

  	
   

  	
  IL

  	
   

  	
  Roof Repairs

  	
   

  	
  According to POC, there are minor roof leaks during
  periods of heavy rain.  Isolated water
  stains were observed on ceiling tiles in the retail area, indicating possible
  roof leaks.   (Approximately 200 Linear
  Feet)

  	
   

  	
  200

  	
   

  	
  LF

  	
   

  	
  $

  	
  1,000

  	
   

  
	
   

  	
   

  	
  3007

  	
   

  	
  Mount Carmel

  	
   

  	
  IL

  	
   

  	
  Masonry Repairs

  	
   

  	
  Brick veneer is damaged at the east elevation of the
  building, near the loading dock. 
  Repair brick veneer.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,000

  	
   

  
	
   

  	
   

  	
  3023

  	
   

  	
  Manistique

  	
   

  	
  MI

  	
   

  	
  Landscaping

  	
   

  	
  Clear overgrown vegetation from the rock and drainage
  splash areas to keep positive flow. 
  The drainage channel and rock area at rear of the building is overgrown
  with shrubs and other rooted vegetation. 
  The vegetation will be required to be removed so as to keep a positive
  flow of runoff from roof downspouts.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,000

  	
   

  
	
   

  	
   

  	
  3178

  	
   

  	
  Lander

  	
   

  	
  WY

  	
   

  	
  Fire Protection

  	
   

  	
  Expired sprinkler system inspection.  Contract system inspection.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,000

  	
   

  
	
   

  	
   

  	
  3190

  	
   

  	
  Glasgow

  	
   

  	
  MT

  	
   

  	
  HVAC Repairs

  	
   

  	
  Repair inoperable rooftop unit immediately.  According to POC, one of the roof top units
  has not operated since installed in 1998.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,000

  	
   

  
	
   

  	
   

  	
  3194

  	
   

  	
  Ashland

  	
   

  	
  WI

  	
   

  	
  Roof Repairs

  	
   

  	
  Active roof leaks at existing construction joint
  between Phase 1 and Phase 2 - Repair.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,000

  	
   

  
	
   

  	
   

  	
  3194

  	
   

  	
  Ashland

  	
   

  	
  WI

  	
   

  	
  Door Repairs

  	
   

  	
  Replace damaged door frame around the overhead door
  located along the left (east) elevation of the building.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,000

  	
   

  
	
   

  	
   

  	
  3194

  	
   

  	
  Ashland

  	
   

  	
  WI

  	
   

  	
  Door Repairs

  	
   

  	
  Replace damaged door frame on the service door along
  the left (east) side elevation of the building.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,000

  	
   

  
	
   

  	
   

  	
  3852

  	
   

  	
  Bethany

  	
   

  	
  MO

  	
   

  	
  Exterior Building

  	
   

  	
  Wall on west side of property leaks into first floor
  warehouse area during heavy rains. 
  Waterproofing required. 
  (Approximately 1,000 Square Feet)

  	
   

  	
  1,000

  	
   

  	
  SF

  	
   

  	
  $

  	
  1,000

  	
   

  
	
   

  	
   

  	
  3880

  	
   

  	
  Clarion

  	
   

  	
  IA

  	
   

  	
  Roof Repairs

  	
   

  	
  Install sealant at roof penetrations above main entrance.  Current roof leaks.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,000

  	
   

  
	
   

  	
   

  	
  3146

  	
   

  	
  Mitchell

  	
   

  	
  IN

  	
   

  	
  Roof Repairs

  	
   

  	
  Replace flashing around roof top units.  According to the POC, roof leaks occur
  around the HVAC units during periods of heavy rain.  Water stained ceiling tile observed near
  air distribution grilles. 
  (Approximately 170 Linear Feet)

  	
   

  	
  170

  	
   

  	
  LN

  	
   

  	
  $

  	
  1,105

  	
   

  
	
   

  	
   

  	
  3015

  	
   

  	
  Minerva

  	
   

  	
  OH

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Repair deteriorated paving in parking lot at the
  front of the building.  (Approximately
  400 Square Feet)

  	
   

  	
  400

  	
   

  	
  SF

  	
   

  	
  $

  	
  1,200

  	
   

  
	
   

  	
   

  	
  3298

  	
   

  	
  Park Rapids

  	
   

  	
  MN

  	
   

  	
  Masonry Repairs

  	
   

  	
  Repair exterior wall. 
  There are isolated areas of damaged concrete block CMU.  The damage CMU must be repaired and
  replaced.  (Approximately 40 Square
  Feet)

  	
   

  	
  40

  	
   

  	
  SF

  	
   

  	
  $

  	
  1,200

  	
   

  
	
   

  	
   

  	
  3096

  	
   

  	
  Ely

  	
   

  	
  MN

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  There is a crack along the rear foundation wall which
  allows some water infiltration. 
  Although the estimated costs of repair cannot be accurately determined
  a cost allowance to repair the affected elements is included.  Also recommend that the affected area be
  monitored for future movement by structural engineer.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,250

  	
   

  
	
   

  	
   

  	
  3117

  	
   

  	
  Loogootee

  	
   

  	
  IN

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Cut and patch asphalt as required.  The asphalt is crumbling at the east
  entrance drive to the property. 
  (Approximately 500 Square Feet)

  	
   

  	
  500

  	
   

  	
  SF

  	
   

  	
  $

  	
  1,250

  	
   

  
	
   

  	
   

  	
  3129

  	
   

  	
  Wahpeton

  	
   

  	
  ND

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Cut and patch asphalt as required.  There are significant areas of failure,
  deterioration, and localized depressions in the paving.  (Approximately 500 Square Feet)

  	
   

  	
  500

  	
   

  	
  SF

  	
   

  	
  $

  	
  1,250

  	
   

  
	
   

  	
   

  	
  3190

  	
   

  	
  Glasgow

  	
   

  	
  MT

  	
   

  	
  Roof Repairs

  	
   

  	
  Locate roof leaks & repair.  According to POC, minor roof leaks occur
  around some of the rooftop units when it rains.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,500

  	
   

  
	
   

  	
   

  	
  3252

  	
   

  	
  Powell

  	
   

  	
  WY

  	
   

  	
  Roof Repairs

  	
   

  	
  Repair active roof leaks.  According to POC, the roof leaks during
  heavy rains and needs to be spot repaired.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,500

  	
   

  

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Immediate

  Repair Reserve

  Amount

  	
   

  
	
  Item

  	
   

  	
  Store #

  	
   

  	
  City

  	
   

  	
  St

  	
   

  	
  Short
  Description

  	
   

  	
  Additional
  Description

  	
   

  	
  Qty

  	
   

  	
  Unit of

  Measure

  	
   

  	
  Year 1

  2006

  	
   

  
	
   

  	
   

  	
  3256

  	
   

  	
  Tuscola

  	
   

  	
  IL

  	
   

  	
  Roof Repairs

  	
   

  	
  Re-fasten membrane. 
  The roof membrane was observed lifting at the northwest corner of the
  building over an approximate area of 300 square feet.  Due to the age of the building, this
  appears to be a warranty issue and should be addressed with the installation
  contractor.  An estimated cost is
  provided in the event the warranty is not in effect.  The POC had no knowledge of warranty
  in-place.  The lifting of the membrane
  may be responsible - at least in part - for some stains observed in reflected
  ceiling tiles along the north wall of the building.  (Approximately 3 SQ)

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,500

  	
   

  
	
   

  	
   

  	
  3190

  	
   

  	
  Glasgow

  	
   

  	
  MT

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Replace damaged concrete w/ 5” reinforced
  concrete.  The concrete slab adjacent
  to the loading dock areas was observed to be significantly cracked.  (Approximately 350 Square Feet)

  	
   

  	
  350

  	
   

  	
  SF

  	
   

  	
  $

  	
  1,750

  	
   

  
	
   

  	
   

  	
  3089

  	
   

  	
  Washington

  	
   

  	
  IA

  	
   

  	
  Exterior Building

  	
   

  	
  Three metal panels are damaged at the rear of the
  building.  Replace metal panels.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  1,800

  	
   

  
	
   

  	
   

  	
  3298

  	
   

  	
  Park Rapids

  	
   

  	
  MN

  	
   

  	
  Exterior Building

  	
   

  	
  Replace aluminum siding.  Damaged metal panels along loading dock
  from truck docking.  (Approximately 400
  Square Feet)

  	
   

  	
  400

  	
   

  	
  SF

  	
   

  	
  $

  	
  1,880

  	
   

  
	
   

  	
   

  	
  3023

  	
   

  	
  Manistique

  	
   

  	
  MI

  	
   

  	
  Landscaping

  	
   

  	
  The grass landscape area at the west side of the
  property is barren due to snow plow disposal in the area.  Grass replacement is recommended to prevent
  erosion.  It is recommended that rock
  be installed in the snow drainage areas in the future, similar to adjacent
  property at the south.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  2,000

  	
   

  
	
   

  	
   

  	
  3190

  	
   

  	
  Glasgow

  	
   

  	
  MT

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Replace concrete walkways.  The concrete sidewalk proceeding the main
  entrance into the building was observed to be significantly cracked.  (Approximately 250 Square Feet)

  	
   

  	
  250

  	
   

  	
  SF

  	
   

  	
  $

  	
  2,000

  	
   

  
	
   

  	
   

  	
  3028

  	
   

  	
  Havana

  	
   

  	
  IL

  	
   

  	
  Exterior Painting

  	
   

  	
  Rust spots observed on all exterior wall
  elevations.  An attempt should be made
  to seal the oxidizing material points on the wall surfaces prior to
  repainting entire elevations.  The
  front elevation may be touched-up in year 1 as routine maintenance.  Then painted later in the term as noted.  The west wall should be repainted as an
  immediate repair.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  2,250

  	
   

  
	
   

  	
   

  	
  3226

  	
   

  	
  Sullivan

  	
   

  	
  IL

  	
   

  	
  Roof Repairs

  	
   

  	
  Re-fasten membrane. 
  Roof membrane observed lifting in (2) areas of approximately 900 and
  600 square feet, over the southwest quadrant of the building.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  2,250

  	
   

  
	
   

  	
   

  	
  3153

  	
   

  	
  Glenwood

  	
   

  	
  MN

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Regrade asphalt paving to drains.  Ponding occurs at (2) locations in parking
  lot.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  2,500

  	
   

  
	
   

  	
   

  	
  3169

  	
   

  	
  Arcadia

  	
   

  	
  WI

  	
   

  	
  Roof Repairs

  	
   

  	
  Repair roof leaks. 
  There are active roof leaks in the mansard roof, as evidenced by
  stained ceiling tiles.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  2,500

  	
   

  
	
   

  	
   

  	
  3195

  	
   

  	
  Lancaster

  	
   

  	
  WI

  	
   

  	
  Roof Repairs

  	
   

  	
  Identify areas of water infiltration & tighten or
  provide additional sealant at mechanical fasteners.  Roof membrane in general appears to be in
  good condition and is approximately 6 years old.  Repair cost may be negated if warranty
  item.  Approximately 125 square feet of
  stained acoustical ceiling tiles over roughly 12 local areas, most of which
  are assumed to be from active roof leakage. 
  Per the POC, a roof investigation was done last year.  EMG observed the rubber covers of several
  mechanical fasteners (shanks) on the roof circled in white marker, presumably
  indicating potential leaks were observed during the PCA as it was dry.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  2,500

  	
   

  
	
   

  	
   

  	
  3122

  	
   

  	
  Detroit Lakes

  	
   

  	
  MN

  	
   

  	
  Masonry Repairs

  	
   

  	
  Repair CMU wall on the left elevation.  There are isolated areas of damaged
  concrete block along the left elevation. 
  The damaged concrete must be repaired or replaced.  (Approximately 100 Square Feet)

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  3,000

  	
   

  
	
   

  	
   

  	
  3223

  	
   

  	
  Plentywood

  	
   

  	
  MT

  	
   

  	
  Roof Repairs

  	
   

  	
  Replace asphalt shingles and flashings.  Although no roof leaks are reported, the
  current state of the roof is in poor condition.  Missing shingles, improperly installed
  metal flashings, and poor roof repairs were observed.  (approximately 27 SQ)

  	
   

  	
  27

  	
   

  	
  SQ

  	
   

  	
  $

  	
  3,240

  	
   

  

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Immediate

  Repair Reserve

  Amount

  	
   

  
	
  Item

  	
   

  	
  Store #

  	
   

  	
  City

  	
   

  	
  St

  	
   

  	
  Short
  Description

  	
   

  	
  Additional
  Description

  	
   

  	
  Qty

  	
   

  	
  Unit of

  Measure

  	
   

  	
  Year 1

  2006

  	
   

  
	
   

  	
   

  	
  3252

  	
   

  	
  Powell

  	
   

  	
  WY

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Seal coat asphalt. 
  The lot is badly worn and is in need of seal coating.  (Approximately 43,300 Square Feet)

  	
   

  	
  43,300

  	
   

  	
  SF

  	
   

  	
  $

  	
  3,472

  	
   

  
	
   

  	
   

  	
  3153

  	
   

  	
  Glenwood

  	
   

  	
  MN

  	
   

  	
  Exterior Building

  	
   

  	
  Connect downspout terminations to the underground
  storm water system.  The existing
  downspouts discharge onto splash blocks which spill onto the soil, causing
  the soil at the northern portion of the site to be waterlogged.   (Qty 7)

  	
   

  	
  7

  	
   

  	
  EA

  	
   

  	
  $

  	
  3,500

  	
   

  
	
   

  	
   

  	
  3096

  	
   

  	
  Ely

  	
   

  	
  MN

  	
   

  	
  Masonry Repairs

  	
   

  	
  The brick veneer is in fair condition.  There are significant areas of cracking and
  deteriorated mortar joints along the rear wall and chimney.  The damaged joints must be repaired or
  replaced.  (Approximately 1,500 Square Feet)

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  4,875

  	
   

  
	
   

  	
   

  	
  3223

  	
   

  	
  Plentywood

  	
   

  	
  MT

  	
   

  	
  Structural

  	
   

  	
  Follow up study: Structural Engineer to review &
  report on the structural integrity of the mezzanine.  According to the POC, the State Building
  Inspector, Mr. Richard Larson, visited the property and was concerned about
  the deflection of the mezzanine floor visible at the edge of the
  mezzanine.  The POC stated that the
  inspector is requiring the store management to procure the services of a
  licensed structural engineer to determine if mezzanine is sound.  The estimated cost for this work is
  included in the cost tables.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  5,000

  	
   

  
	
   

  	
   

  	
  3852

  	
   

  	
  Bethany

  	
   

  	
  MO

  	
   

  	
  Site Electrical

  	
   

  	
  Trench new high voltage power lines from new pad
  mounted transformer to existing service panels.  Pamida portion of property is served by old
  dry-type transformer which are no longer serviceable.  The City utility provider has told the
  store to tie into the new pad mounted transformer recently installed for the
  Hy-Vee Grocery store attached to the building.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  5,000

  	
   

  
	
   

  	
   

  	
  3873

  	
   

  	
  Burlington

  	
   

  	
  KS

  	
   

  	
  Roof Repairs

  	
   

  	
  Install liquid sealer to roof assembly.  Currently there are approximately (4) roof
  leaks.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  5,000

  	
   

  
	
   

  	
   

  	
  3178

  	
   

  	
  Lander

  	
   

  	
  WY

  	
   

  	
  Exterior Painting

  	
   

  	
  There is water damage at (5) vertical locations along
  the left (south) wall.  Damage appears
  to be due to inadequate edge flashing at the side roof gutter.  After repair of the flashing, the walls at
  these locations should be scraped and all the walls subsequently
  painted.  (approximately 8,000 Square
  Feet)

  	
   

  	
  8,000

  	
   

  	
  SF

  	
   

  	
  $

  	
  5,200

  	
   

  
	
   

  	
   

  	
  3007

  	
   

  	
  Mount Carmel

  	
   

  	
  IL

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Replace damaged concrete with 5” reinforced
  concrete.  The concrete pavement is in
  fair to poor condition.  There is
  deteriorated, spalling, and cracking concrete throughout the property.  The heaviest damage is along the east side
  of the property, near the loading dock. 
  (approximately 1,500 Square Feet)

  	
   

  	
  1,500

  	
   

  	
  SF

  	
   

  	
  $

  	
  7,500

  	
   

  
	
   

  	
   

  	
  3226

  	
   

  	
  Sullivan

  	
   

  	
  IL

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Overlay asphalt. 
  Asphalt at south end of parking lot observed badly worn, with
  alligatoring and depressed areas. 
  Subject area is a rectangular strip at southernmost end of the asphalt
  parking area, adjacent to the left side (south) building elevation and
  extending into the front parking lot. 
  The approximate dimensions are 50 feet (in the north-south dimension)
  by 300 feet.  (Approximately 15,000
  Square Feet)

  	
   

  	
  15,000

  	
   

  	
  SF

  	
   

  	
  $

  	
  7,500

  	
   

  
	
   

  	
   

  	
  3194

  	
   

  	
  Ashland

  	
   

  	
  WI

  	
   

  	
  Exterior Building

  	
   

  	
  Replace sections of damaged metal siding.  Metal panels are damaged along the left
  (East) side and rear (south) side elevations of the building.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  8,000

  	
   

  
	
   

  	
   

  	
  3158

  	
   

  	
  Archbold

  	
   

  	
  OH

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Cut and remove concrete, stabilize and replace.
  Concrete shifts with frost.  Areas
  affected are front entry, south exit door in Sporting Goods, and loading dock
  service doors.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  10,000

  	
   

  
	
   

  	
   

  	
  Pam GO

  	
   

  	
  Omaha

  	
   

  	
  NE

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Seal coat asphalt. 
  Asphalt pavement surface roughness. 
  (Approximately 110,000 Square Feet)

  	
   

  	
  110,000

  	
   

  	
  SF

  	
   

  	
  $

  	
  11,000

  	
   

  
	
   

  	
   

  	
  3252

  	
   

  	
  Powell

  	
   

  	
  WY

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Cut and patch asphalt.  Approximately 10% of the lot requires
  cutting and patching.  (Approximately
  4,500 square feet)

  	
   

  	
  4,500

  	
   

  	
  SF

  	
   

  	
  $

  	
  11,250

  	
   

  

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Immediate

  Repair Reserve

  Amount

  	
   

  
	
  Item

  	
   

  	
  Store #

  	
   

  	
  City

  	
   

  	
  St

  	
   

  	
  Short
  Description

  	
   

  	
  Additional
  Description

  	
   

  	
  Qty

  	
   

  	
  Unit of

  Measure

  	
   

  	
  Year 1

  2006

  	
   

  
	
   

  	
   

  	
  3033

  	
   

  	
  Woodsfield

  	
   

  	
  OH

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  There are significant areas of failure and
  deterioration such as alligator cracking and localized depressions on the
  north side of the parking area.  There
  are areas of routing and heaving in the parking area on the northwest corner
  of the property and the center of the main parking area.  (Approximately 6,000 Square Feet)

  	
   

  	
  6,000

  	
   

  	
  SF

  	
   

  	
  $

  	
  15,000

  	
   

  
	
   

  	
   

  	
  3194

  	
   

  	
  Ashland

  	
   

  	
  WI

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Overlay asphalt. 
  Asphalt pavement requires an overlay and major pot hole repairs.  (approximately 39,600 Square Feet)

  	
   

  	
  39,600

  	
   

  	
  SF

  	
   

  	
  $

  	
  19,800

  	
   

  
	
   

  	
   

  	
  3153

  	
   

  	
  Glenwood

  	
   

  	
  MN

  	
   

  	
  Roof Repairs

  	
   

  	
  Replace scuppers & affected portions of roof
  membrane and insulation.  Ponding occurs
  in the roof.  Scuppers are located
  higher than the field of the roof and therefore do not drain fully.  Several leaks in the membrane roof allow
  standing water to penetrate into the space and structure below.  Water was observed dripping from several location
  in the stock room.  Also the west
  exterior CMU wall was observed to be wet due to water infiltration from the
  roof.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  20,000

  	
   

  
	
   

  	
   

  	
  3178

  	
   

  	
  Lander

  	
   

  	
  WY

  	
   

  	
  Roof Repairs

  	
   

  	
  The older southern half of the roof has exceeded its
  useful life.  Is reportedly leaking in
  several locations and needs to be replaced.  
  (Approximately 120 SQ)

  	
   

  	
  120

  	
   

  	
  SQ

  	
   

  	
  $

  	
  32,400

  	
   

  
	
   

  	
   

  	
  3007

  	
   

  	
  Mount Carmel

  	
   

  	
  IL

  	
   

  	
  HVAC Repairs

  	
   

  	
  According to POC, 11 of the 14 rooftop units are not
  functioning.  Some appear to be
  original units.  Three new units are
  scheduled to be installed in June. 
  This leaves (8) non-functioning rooftop units.  The broken rooftop units should be
  replaced.

  	
   

  	
  1

  	
   

  	
  LS

  	
   

  	
  $

  	
  68,000

  	
   

  
	
   

  	
   

  	
  3126

  	
   

  	
  Rawlins

  	
   

  	
  WY

  	
   

  	
  Asphalt / Concrete
  Repairs

  	
   

  	
  Overlay Asphalt. 
  There is widespread surface wear and alligator cracking throughout the
  parking lot.  The problem is compounded
  by inadequate drainage and ponding. 
  The problem areas need to be cut and patched and the entire lot should
  be subsequently resurfaced, with surface drainage improved.   (Approximately 76,000 Square Feet)

  	
   

  	
  76,000

  	
   

  	
  SF

  	
   

  	
  $

  	
  76,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Total Immediate Repairs:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  367,922

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Amount
  for Reserve:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  459,903

  	
   

  

 

The
deadline for completing the repairs set forth above shall be January 1, 2007

 

 

EXHIBIT J

 

FORM INCOME AND EXPENSE STATEMENT

FOR INDIVIDUAL PROPERTY LOCATION

 

[Store Number], [CITY], [STATE]

STORE INCOME STATEMENT

[MONTH]

TOTAL DEPTS

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Dollar Variance (B/W)

  	
   

  	
  Basis PT Variance (B/W)

  	
   

  
	
  FY 2005

  	
   

  	
  FY 2004

  	
   

  	
   

  	
   

  	
  FY05 VS FY04

  	
   

  	
  FY05 VS FY04

  	
   

  
	
  ACTUALS

  	
   

  	
  % SLS

  	
   

  	
  ACTUALS

  	
   

  	
  % SLS

  	
   

  	
  ACCOUNT

  	
   

  	
  ACTUALS

  	
   

  	
  ACTUALS

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  NET SALES

  COST OF SALES

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  SKU GROSS MARGIN

  ALLOWANCES SMART CLEARANCE

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  MERCHANT MARGIN

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  ESTIMATED SHRINK EXPENSE

  PHYSICAL INVENTORY ADJUST.

  OTHER GM COMPONENTS

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  FINANCE MARGIN

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  ADJUSTED GROSS MARGIN

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  RENTAL INCOME

  MISCELLANEOUS INCOME

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL OTHER INCOME

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  PAYROLL - EXEMPT

  PAYROLL - NONEXEMPT

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL PAYROLL

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  BENEFITS & INSURANCE

  PAYROLL TAXES

  LOSS PREVENTION PAYROLL

  WRAPPING & SUPPLIES

  BANK CARD FEES

  FREIGHT EXPENSE - STORES

  MISCELLANEOUS - STORES

  NET CASH SHORT/BAD DEBT

  M&R STORE CONTROLLED

  TELEPHONE

  ELECTRIC, WATER & FUEL

  MANAGER’S PIP

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL STORE CONTROLLED EXPENSES

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  M&RISD CONTROLLED

  WAREHOUSE EXPENSES

  RENT EXPENSE

  INSURANCE-PROP/WC/GL

  PROPERTY TAXES

  P & A ALLOWANCES

  PRE-OPENING EXTRANEOUS

  DEPRECIATION/AMORTIZATION

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  TOTAL STORE EXP. & DEPREC.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  CONTRIBUTION TO CORPORATE PROFIT

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  LEASED SALES

  BOOK INVENTORY

  NET PROPERTY & EQUIPMENT

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

J-1Exhibit 10.3

 

 

 

LOAN AGREEMENT

Dated as of May 31, 2006

Between

EACH OF THE PARTIES
SET FORTH ON EXHIBIT A

individually and collectively, as the context may require, as Borrower

and

BARCLAYS CAPITAL REAL ESTATE INC. and CITIGROUP
GLOBAL MARKETS

REALTY CORP.,

collectively, as Lender

 

 

 

TABLE OF CONTENTS

 

	
   

  	
  Page

  
	
   

  	
   

  
	
  I.

  	
  DEFINITIONS; PRINCIPLES OF
  CONSTRUCTION

  	
  1

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 1.1

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 1.2

  	
  Principles of Construction

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
  II.

  	
  GENERAL TERMS

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.1

  	
  Loan Commitment; Disbursement to
  Borrower

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.1.1

  	
  Agreement to Lend and Borrow

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.1.2

  	
  Single Disbursement to Borrower

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.1.3

  	
  The Note, Security Instruments and
  Loan Documents

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.1.4

  	
  Use of Proceeds

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.2

  	
  Interest; Loan Payments; Late
  Payment Charge

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.2.1

  	
  Payments

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.2.2

  	
  Interest Calculation

  	
  28

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.2.3

  	
  Payment on Maturity Date

  	
  28

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.2.4

  	
  Payments after Default

  	
  28

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.2.5

  	
  Late Payment Charge

  	
  29

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.2.6

  	
  Usury Savings

  	
  29

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.2.7

  	
  Indemnified Taxes

  	
  29

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.3

  	
  Prepayments

  	
  30

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.3.1

  	
  Voluntary Prepayments

  	
  30

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.3.2

  	
  Mandatory Prepayments

  	
  31

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.3.3

  	
  Prepayments After Default

  	
  31

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.3.4

  	
  Making of Payments

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.3.5

  	
  Application of Prepayments

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.4

  	
  Defeasance

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.4.1

  	
  Voluntary Defeasance

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.4.2

  	
  Successor Borrower

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.5

  	
  Release of Property

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.5.1

  	
  Release of the Properties

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.5.2

  	
  Release of Individual Property

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.5.3

  	
  Release on Payment in Full

  	
  37

  

 

 

	
   

  	
  2.5.4

  	
  Out-Parcel Releases

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.5.5

  	
  Release of the Madison Property
  Prior to the Permitted Defeasance Date

  	
  39

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.6

  	
  Substitution of Properties

  	
  39

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.7

  	
  Purchase of the Fee Estate of the
  Burlington Property

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
  III.

  	
  CASH MANAGEMENT

  	
  47

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.1

  	
  Establishment of Accounts

  	
  47

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.2

  	
  Deposits into Lockbox Account

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.3

  	
  Account Name

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.4

  	
  Eligible Accounts

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.5

  	
  Permitted Investments

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.6

  	
  The Initial Deposits

  	
  50

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.7

  	
  Transfer To and Disbursements from
  the Lockbox Account

  	
  50

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.8

  	
  Withdrawals From the Tax Account and
  the Insurance Premium Account

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.9

  	
  Withdrawals from the Replacement
  Reserve Account

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.10

  	
  Withdrawals from the Excess Cash
  Reserve Account

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.11

  	
  Withdrawals from the Debt Service
  Account

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.12

  	
  Withdrawals from the Operating
  Expense Reserve Account

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.13

  	
  Withdrawals from the Extraordinary
  Expense Reserve Account

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.14

  	
  Intentionally Omitted

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.15

  	
  Withdrawals from the Ground Rent
  Account

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.16

  	
  Sole Dominion and Control

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.17

  	
  Security Interest

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.18

  	
  Rights on Default

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.19

  	
  Financing Statement; Further
  Assurances

  	
  53

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.20

  	
  Borrower’s Obligation Not Affected

  	
  53

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.21

  	
  Payments Received Under this
  Agreement

  	
  53

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.22

  	
  Letters of Credit

  	
  53

  
	
   

  	
   

  	
   

  	
   

  
	
  IV.

  	
  REPRESENTATIONS AND WARRANTIES

  	
  54

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.1

  	
  Borrower Representations

  	
  54

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.1

  	
  Organization

  	
  54

  

 

ii

 

	
   

  	
  4.1.2

  	
  Proceedings

  	
  54

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.3

  	
  No Conflicts

  	
  54

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.4

  	
  Litigation

  	
  54

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.5

  	
  Agreements

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.6

  	
  Solvency

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.7

  	
  Full and Accurate Disclosure

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.8

  	
  No Plan Assets

  	
  56

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.9

  	
  Compliance

  	
  56

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.10

  	
  Financial Information

  	
  56

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.11

  	
  Condemnation

  	
  56

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.12

  	
  Federal Reserve Regulations

  	
  57

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.13

  	
  Utilities and Public Access

  	
  57

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.14

  	
  Not a Foreign Person

  	
  57

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.15

  	
  Separate Lots

  	
  57

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.16

  	
  Assessments

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.17

  	
  Enforceability

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.18

  	
  No Prior Assignment

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.19

  	
  Insurance

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.20

  	
  Use of Property

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.21

  	
  Certificate of Occupancy; Licenses

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.22

  	
  Flood Zone

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.23

  	
  Physical Condition

  	
  59

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.24

  	
  Boundaries

  	
  59

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.25

  	
  Leases

  	
  59

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.26

  	
  Intentionally Omitted

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.27

  	
  Intentionally Omitted

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.28

  	
  Filing and Recording Taxes

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.29

  	
  Operating Leases

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.30

  	
  Intentionally Omitted

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.31

  	
  Illegal Activity

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.32

  	
  No Change in Facts or Circumstances;
  Disclosure

  	
  60

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.33

  	
  Investment Company Act

  	
  61

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.34

  	
  Principal Place of Business; State
  of Organization

  	
  61

  

 

iii

 

	
   

  	
  4.1.35

  	
  Single Purpose Entity

  	
  61

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.36

  	
  Business Purposes

  	
  66

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.37

  	
  Taxes

  	
  66

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.38

  	
  Forfeiture

  	
  66

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.39

  	
  Environmental Representations and
  Warranties

  	
  66

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.40

  	
  Taxpayer Identification Number

  	
  67

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.41

  	
  OFAC

  	
  67

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.42

  	
  Ground Lease Representations

  	
  67

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.43

  	
  Deposit Accounts

  	
  68

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.44

  	
  Embargoed Person

  	
  69

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.2

  	
  Survival of Representations

  	
  69

  
	
   

  	
   

  	
   

  	
   

  
	
  V.

  	
  BORROWER COVENANTS

  	
  69

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.1

  	
  Affirmative Covenants

  	
  69

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.1

  	
  Existence; Compliance with Legal
  Requirements

  	
  70

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.2

  	
  Taxes and Other Charges

  	
  70

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.3

  	
  Litigation

  	
  71

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.4

  	
  Access to Properties

  	
  71

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.5

  	
  Notice of Default

  	
  71

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.6

  	
  Cooperate in Legal Proceedings

  	
  71

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.7

  	
  Award and Insurance Benefits

  	
  71

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.8

  	
  Further Assurances

  	
  71

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.9

  	
  Mortgage and Intangible Taxes

  	
  72

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.10

  	
  Financial Reporting

  	
  72

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.11

  	
  Business and Operations

  	
  74

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.12

  	
  Costs of Enforcement

  	
  74

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.13

  	
  Estoppel Statement

  	
  75

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.14

  	
  Loan Proceeds

  	
  75

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.15

  	
  Performance by Borrower

  	
  75

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.16

  	
  Confirmation of Representations

  	
  75

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.17

  	
  Leasing Matters

  	
  75

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.18

  	
  Management Agreement

  	
  77

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.19

  	
  Environmental Covenants

  	
  77

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.20

  	
  Alterations

  	
  78

  

 

iv

 

	
   

  	
  5.1.21

  	
  The Ground Lease

  	
  79

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.22

  	
  Intentionally Omitted

  	
  80

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.1.23

  	
  OFAC

  	
  80

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.2

  	
  Negative Covenants

  	
  81

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.1

  	
  Liens

  	
  81

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.2

  	
  Dissolution

  	
  81

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.3

  	
  Change In Business

  	
  81

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.4

  	
  Debt Cancellation

  	
  81

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.5

  	
  Zoning.

  	
  81

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.6

  	
  No Joint Assessment

  	
  82

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.7

  	
  Name, Identity, Structure, or
  Principal Place of Business

  	
  82

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.8

  	
  ERISA

  	
  82

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.9

  	
  Affiliate Transactions

  	
  82

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.10

  	
  Transfers

  	
  82

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.2.11

  	
  Assumption

  	
  84

  
	
   

  	
   

  	
   

  	
   

  
	
  VI.

  	
  INSURANCE; CASUALTY; CONDEMNATION;
  REQUIRED REPAIRS

  	
  86

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.1

  	
  Insurance

  	
  86

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.2

  	
  Casualty

  	
  90

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.3

  	
  Condemnation

  	
  90

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.4

  	
  Restoration

  	
  91

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.4.1

  	
  Application to Restoration

  	
  91

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.4.2

  	
  Application to Debt

  	
  92

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.4.3

  	
  Procedure for Application to Restoration

  	
  92

  
	
   

  	
   

  	
   

  	
   

  
	
  VII.

  	
  RESERVE FUNDS

  	
  93

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.1

  	
  Required Repair Funds

  	
  93

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.1.1

  	
  Deposits

  	
  93

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.1.2

  	
  Release of Required Repair Funds

  	
  93

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.2

  	
  Tax and Insurance Escrow Fund

  	
  94

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.3

  	
  Replacements and Replacement
  Reserve

  	
  95

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.3.1

  	
  Replacement Reserve Fund

  	
  95

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.3.2

  	
  Disbursements from Replacement
  Reserve Account

  	
  96

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.3.3

  	
  Performance of Replacements

  	
  96

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  7.3.4

  	
  Balance in the Replacement Reserve
  Account

  	
  99

  

 

v

 

	
   

  	
  Section 7.4

  	
  Intentionally Omitted

  	
  99

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.5

  	
  Holdback Reserve Funds

  	
  99

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.6

  	
  Ground Lease Escrow Fund

  	
  99

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.7

  	
  Reserve Funds Generally

  	
  99

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.8

  	
  Excess Cash Reserve

  	
  100

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.9

  	
  Operating Expenses; Extraordinary
  Expenses

  	
  100

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.10

  	
  Provisions Regarding Letters of
  Credit

  	
  101

  
	
   

  	
   

  	
   

  	
   

  
	
  VIII.

  	
  DEFAULTS

  	
  102

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.1

  	
  Event of Default

  	
  102

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.2

  	
  Remedies

  	
  106

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.3

  	
  Remedies Cumulative; Waivers

  	
  107

  
	
   

  	
   

  	
   

  	
   

  
	
  IX.

  	
  SPECIAL PROVISIONS

  	
  108

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 9.1

  	
  Sale of Notes and Securitization

  	
  108

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 9.2

  	
  Securitization Cooperation

  	
  109

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 9.3

  	
  Servicer

  	
  110

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 9.4

  	
  Exculpation

  	
  110

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 9.5

  	
  Contributions and Waivers

  	
  112

  
	
   

  	
   

  	
   

  	
   

  
	
  X.

  	
  MISCELLANEOUS

  	
  116

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.1

  	
  Survival

  	
  116

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.2

  	
  Lender’s Discretion

  	
  116

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.3

  	
  Governing Law

  	
  116

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.4

  	
  Modification, Waiver in Writing

  	
  117

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.5

  	
  Delay Not a Waiver

  	
  117

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.6

  	
  Notices

  	
  117

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.7

  	
  Trial by Jury

  	
  119

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.8

  	
  Headings

  	
  119

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.9

  	
  Severability

  	
  119

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.10

  	
  Preferences

  	
  119

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.11

  	
  Waiver of Notice

  	
  119

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.12

  	
  Remedies of Borrower

  	
  120

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.13

  	
  Expenses; Indemnity

  	
  120

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.14

  	
  Schedules and Exhibits Incorporated

  	
  121

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.15

  	
  Offsets, Counterclaims and Defenses

  	
  121

  

 

vi

 

	
   

  	
  Section 10.16

  	
  No Joint Venture or Partnership; No
  Third Party Beneficiaries

  	
  121

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.17

  	
  Publicity

  	
  122

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.18

  	
  Cross-Default;
  Cross-Collateralization; Waiver of Marshalling of Assets

  	
  122

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.19

  	
  Waiver of Counterclaim

  	
  123

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.20

  	
  Conflict; Construction of
  Documents; Reliance

  	
  123

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.21

  	
  Brokers and Financial Advisors

  	
  123

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 10.22

  	
  Prior Agreements

  	
  124

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE I Properties - Allocated
  Loan Amounts

  	
  127

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE II Required Repairs

  	
  128

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE III Organizational Chart
  of Borrower

  	
  129

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE IV Ground Leases

  	
  130

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE V Out-Parcels

  	
  131

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE VI Intentionally Omitted

  	
  132

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE VII Immaterial Leases

  	
  133

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE VIII Intentionally Omitted

  	
  134

  
	
   

  	
   

  	
   

  	
   

  
	
  SCHEDULE IX Exceptions to Article 4
  Reps: Litigation and Condemnation Matters

  	
  135

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT A  Borrower

  	
  136

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT B  ShopKo Properties

  	
  137

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT C  Form of P&L Report

  	
  138

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT D  Form of SNDA

  	
  139

  
	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT E  Form of Confidentiality Agreement

  	
  140

  

 

vii

 

LOAN
AGREEMENT

 

THIS LOAN AGREEMENT,
dated as of May 31, 2006 (as amended, restated, replaced, supplemented or
otherwise modified from time to time, this “Agreement”), between BARCLAYS CAPITAL REAL ESTATE INC., a Delaware corporation,
having its principal place of business at 200 Park Avenue, New York, New York
10166 and CITIGROUP GLOBAL MARKETS REALTY CORP.,
a New York corporation, having its principal place of business at 388 Greenwich
Street, New York, New York 10013 (individually and collectively, as the context
may require, “Lender”) and each of the parties set forth on Exhibit A
attached hereto, each having an address at c/o Spirit Finance Corporation, at
14631 N. Scottsdale Rd. Suite 200, Scottsdale, Arizona 85254 (individually and
collectively, as the context may require, “Borrower”).

 

W I T N E S
S E T H:

 

WHEREAS, Borrower
desires to obtain the Loan (as hereinafter defined) from Lender; and

 

WHEREAS, Lender is
willing to make the Loan to Borrower, subject to and in accordance with the
terms of this Agreement and the other Loan Documents (as hereinafter defined).

 

NOW THEREFORE, in
consideration of the making of the Loan by Lender and the covenants,
agreements, representations and warranties set forth in this Agreement, the
parties hereto hereby covenant, agree, represent and warrant as follows:

 

I.              DEFINITIONS;
PRINCIPLES OF CONSTRUCTION

 

Section
1.1            Definitions.

 

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

 

“1.00 EBITDAR
Event” shall mean the date that Lender determines, based on the financial
statements delivered to Lender in accordance with the terms hereof, that for
the immediately preceding twelve (12) month period, the EBITDAR Ratio for
Operating Tenant is less than or equal to 1.00:1.00.

 

“1.10 EBITDAR
Event” shall mean the date that Lender determines, based on the financial
statements delivered to Lender in accordance with the terms hereof, that for
the immediately preceding twelve (12) month period, the EBITDAR Ratio for
Operating Tenant is less than 1.10:1:00 but greater than 1.00:1.00.

 

“Acceptable
Accountant” shall mean a nationally recognized accounting firm reasonably acceptable
to Lender.

 

 

“Account
Collateral” shall mean: (i) the Accounts, and all Cash, checks, drafts,
certificates and instruments, if any, from time to time deposited or held in
the Accounts from time to time; (ii) any and all amounts invested in Permitted
Investments; (iii) all interest, dividends, Cash, instruments and other
property from time to time received, receivable or otherwise payable in respect
of, or in exchange for, any or all of the foregoing; and (iv) to the extent not
covered by clauses (i) - (iii) above, all “proceeds” (as defined under the UCC
as in effect in the State in which the Accounts are located) of any or all of
the foregoing.

 

“Accounts”
shall mean, collectively, the Tax Account, the Insurance Premium Account, the
Replacement Reserve Account, the Required Repair Account, the Ground Rents
Account, the Excess Cash Reserve Account, the Operating Expense Reserve
Account, the Extraordinary Expense Reserve Account or any other escrow account
established by the Loan Documents.

 

“Act” shall
have the meaning set forth in Section 4.1.35(cc) hereof.

 

“Additional
Indemnified Liabilities” shall have the meaning set forth in Section 10.13(b)
hereof.

 

“Affiliate”
shall mean, as to any Person, any other Person that, directly or indirectly, is
in control of, is controlled by or is under common control with such Person or
is a director or officer of such Person or of an Affiliate of such Person.

 

“Affiliated
Manager” shall mean any property manager which is an Affiliate of, or in which
Borrower, Principal, or any Guarantor or Indemnitor has, directly or
indirectly, any legal, beneficial or economic interest.

 

“Allocated
Loan Amount” shall mean, for an Individual Property, the amount set forth on Schedule
I attached hereto.

 

“ALTA” shall
mean American Land Title Association, or any successor thereto.

 

“Annual Budget”
shall mean the operating budget, including all planned capital expenditures for
the Properties prepared by Borrower (or at Borrower’s direction, prepared by
the Operating Tenant) for the applicable Fiscal Year or other period.

 

“Applicable
Contribution” shall have the meaning set forth in Section 9.5(f) hereof.

 

“Applicable
Laws” shall mean all existing and future federal, state and local laws, orders,
ordinances, governmental rules and regulations and court orders.

 

“Applicable
Interest Rate” shall mean 6.5875% per annum.

 

“Appraisal”
shall mean an appraisal prepared in accordance with the requirements of FIRREA
and USPAP, prepared by an independent third party appraiser holding an MAI
designation, who is State licensed or State certified if required under the
laws of the State where the applicable Individual Property is located, who
meets the requirements of FIRREA and USPAP and who is otherwise satisfactory to
Lender.

 

2

 

“Approved
Accountant” shall mean a “Big Four” accounting firm or other independent
certified public accountant acceptable to Lender.

 

“Approved
Annual Budget” shall have the meaning set forth in Section 5.1.10(e) hereof.

 

“Assignment
Requirements” shall mean delivery of evidence acceptable to Lender that (i) the
assignee has an investment rating of BBB or better from S&P (or an
equivalent rating or shadow rating from another nationally recognized
statistical rating organization), or (ii) the assignee, at the time of the
proposed assignment (a) meets or exceeds a corporate EBITDAR Ratio of
1.60:1.00, (b) has a corporate GAAP net worth at least equal to $50,000,000.00
and (c) has annual aggregate corporate revenues of at least $600,000,000.00 or
(iii) the assignee has a corporate GAAP net worth at least equal to $250,000,000.00;
provided however, that the foregoing conditions may be satisfied by a Person
that guarantees the lease obligations of the proposed assignee.

 

“Award” shall
mean any compensation paid by any Governmental Authority in connection with a
Condemnation in respect of all or any part of any Individual Property.

 

“Bankruptcy Code” shall mean Title 11 U.S.C.
§ 101 et seq., and the
regulations adopted and promulgated pursuant thereto (as the same may be
amended from time to time).

 

“Barclays”
shall mean Barclays Capital Real Estate Inc., a Delaware corporation.

 

“Base Rent”
shall have the meaning set forth in the Operating Leases.

 

“Basic
Carrying Costs” shall mean, with respect to each Individual Property, the sum
of the following costs associated with such Individual Property for the
relevant Fiscal Year or payment period: (i) Taxes and (ii) Insurance Premiums
and (iii) if applicable to such
Individual Property, Ground Rent.

 

“Benefit Amount” shall
have the meaning set forth in Section 9.5(d) hereof.

 

“Borrower”
shall have the meaning set forth in the introductory paragraph hereto, together
with its successors and assigns.

 

“Burlington
Property” shall have the meaning set forth in Section 2.7 hereof.

 

“Business Day”
shall mean any day other than a Saturday, Sunday or any other day on which
national banks in New York, New York are not open for business.

 

“Business Party” shall have the meaning set
forth in Section 4.1.35(z) hereof.

 

“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” shall
mean coin or currency of the United States of America or immediately available
federal funds, including such fund delivered by wire transfer.

 

3

 

“Casualty”
shall have the meaning set forth in Section 6.2 hereof.

 

“Citi” shall
mean Citigroup Global Markets Realty Corp., a New York corporation.

 

“Closing Date”
shall mean the date of the funding of the Loan.

 

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

 

“Collateral”
shall mean the Properties, the Accounts, the Reserve Funds, the Guaranty, the Personal Property,
the Rents, the Account Collateral, and all other real or personal property of
Borrower that is at any time pledged, mortgaged or otherwise given as security
to Lender for the payment of the Debt under the Security Instruments, this
Agreement or any other Loan Document.

 

“Condemnation”
shall mean a temporary or permanent taking by any Governmental Authority as the
result or in lieu or in anticipation of the exercise of the right of
condemnation or eminent domain, of all or any part of any Individual Property,
or any interest therein or right accruing thereto, including any right of
access thereto or any change of grade affecting such Individual Property or any
part thereof.

 

“Condemnation
Proceeds” shall mean the net amount of the Award, after deduction of its
reasonable costs and expenses (including, but not limited to, reasonable
counsel fees), if any, in collecting same.

 

“Contribution” shall have the meaning set forth in
Section 9.5(a) hereof.

 

“Control” (and
the correlative terms “controlled by” and “controlling”) shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of
management and policies of the business and affairs of the entity in question
by reason of the ownership of beneficial interests, by contract or otherwise.

 

“CPI Index”
shall mean the Consumer Price Index which is designated for the applicable
month of determination as the United States City Average for All Urban
Consumers, All Items, Not Seasonally Adjusted, with a based period equaling 100
in 1982 – 1984, as published by the United States Department of Labor’s Bureau
of Labor Statistics or any successor agency. 
In the event that the Consumer Price Index ceases to be published, its
successor index as published by the same governmental authority which published
the Consumer Price Index shall be substituted and any necessary reasonable
adjustments shall be made by Lender and Borrower in order to carry out the
intent of this Lease.  In the event there
is no successor index, Lender shall reasonably select an alternative price index
that will constitute a reasonable substitute for the Consumer Price Index.

 

“Creditors
Rights Laws” shall mean with respect to any Person, any existing or future law
of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, conservatorship, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to its debts
or debtors.

 

4

 

“Debt” shall
mean the outstanding principal amount set forth in, and evidenced by, this
Agreement and the Note together with all interest accrued and unpaid thereon
and all other sums due to Lender in respect of the Loan under the Note, this
Agreement, the Security Instruments or any other Loan Document.

 

“Debt Service”
shall mean, with respect to any particular period of time, interest and
principal payments due under the Note or, in the event only a portion of the
Loan is subject to a Defeasance Event, the Undefeased Note for such period.

 

“Debt Service Account”
shall have the meaning set forth in Section 3.1 hereof.

 

“Default”
shall mean the occurrence of any event hereunder or under any other Loan
Document which, but for the giving of notice or passage of time, or both, would
constitute an Event of Default.

 

“Default Rate”
shall mean, with respect to the Loan, a rate per annum equal to the lesser of
(a) the Maximum Legal Rate, or (b) four percent (4%) above the Applicable
Interest Rate.

 

“Defeasance
Collateral” shall have the meaning set forth in Section 2.4.1(b) hereof

 

“Defeasance
Date” shall have the meaning set forth in Section 2.4.1(a)(i) hereof.

 

“Defeasance
Deposit” shall mean an amount equal to the sum of the remaining principal
amount of the Note or the Defeased Note (as applicable), the Yield Maintenance
Premium, any costs and expenses incurred or to be incurred in the purchase of
Defeasance Collateral necessary to meet the Scheduled Defeasance Payments and
any revenue, documentary stamp or intangible taxes or any other tax or charge
due in connection with the transfer of the Note or the Defeased Note, as
applicable, the creation of the Defeased Note and the Undefeased Note, if
applicable, or otherwise required to accomplish the agreements of Section 2.3
and Section 2.4 hereof.

 

“Defeasance
Event” shall have the meaning set forth in Section 2.4.1 hereof.

 

“Defeased Note”
shall have the meaning set forth in Section 2.4.1(a)(v) hereof.

 

“Determined Minimum Rent” shall mean rents for an Individual Property
which shall be computed by multiplying (i) a fraction, the numerator of which
will be the Allocated Loan Amount of such Individual Property and the
denominator of which will be the Loan Amount, by (ii) the current Base Rent
payment.

 

“Disclosure
Document” shall have the meaning set forth in Section 9.2 hereof.

 

“EBITDAR”
shall mean, with respect to any Person, for any twelve (12) month trailing
period, an amount equal to (without duplication): (i) the consolidated net
income of such person for such period, plus (ii) depreciation, amortization and
other non-cash charges (including, but not limited to, imputed interest,
deferred compensation and charges associated with impairment of goodwill
pursuant to FASB 142) for such period (to the extent deducted in the
computation of consolidated net income of such Person), all in accordance with
GAAP, plus (iii) interest expense for such period (to the extent deducted in
the computation of consolidated net income of

 

5

 

such Person), plus (iv) the provision for taxes for such period (to the
extent deducted in the computation of consolidated net income of such Person),
plus (v) any rental amounts (excluding reimbursables for expenses such as
Taxes, Insurance and maintenance) payable by such Person under any leases then
in effect to which such Person is a party, utilizing the rental amounts in
effect at the time of the EBITDAR calculation (collectively. “EBITDAR Rent” (to
the extent such EBITDAR Rent was deducted in the computation of consolidated
net income of such Person), plus (vi) non-recurring items and unusual items, as
set forth in the Operating Lease, less (vii) all non-recurring income items.

 

“EBITDAR Ratio”
shall mean, the ratio of Operating Tenant’s EBITDAR to interest and Operating
Lease expenses.

 

“Eligible Account”
shall mean a separate and identifiable account from all other funds held by the
holding institution that is either (a) an account or accounts maintained with a
federal or State-chartered depository institution or trust company which
complies with the definition of Eligible Institution 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 or trust company, 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 $50,000,000 and subject to
supervision or examination by federal and State authority.  An Eligible Account will not be evidenced by
a certificate of deposit, passbook or other instrument.

 

“Eligible
Institution” shall mean a depository institution or trust company, insured by
the Federal Deposit Insurance Corporation, (a) the short term unsecured debt
obligations or commercial paper of which are rated at least A-1 by S&P, P-1
by Moody’s and F-1 by Fitch in the case of accounts in which funds are held for
thirty (30) days or less, or (b) the long term unsecured debt obligations of
which are rated at least AA by Fitch and S&P and Aa2 by Moody’s in the case
of accounts in which funds are held for more than thirty (30) days.

 

“Eligibility
Requirements” means, with respect to any Person, that such Person (i) has total
assets (in name or under management) in excess of $600,000,000 and (except with
respect to a pension advisory firm or similar fiduciary) capital/statutory
surplus or shareholder’s equity of $250,000,000 and (ii) is regularly engaged
in the business of making or owning commercial real estate loans or operating
commercial mortgage properties.

 

“Embargoed
Person” shall have the meaning set forth in Section 4.1.44 hereof.

 

“Environmental
Indemnity” shall mean that certain Environmental Indemnity Agreement executed
by Borrower and Indemnitor in connection
with the Loan for the benefit of Lender, as the same may be amended, restated,
replaced, supplemented or otherwise modified from time to time.

 

“Environmental
Law” shall mean any federal, State and local laws, statutes, ordinances, rules,
regulations, standards, policies and other government directives or
requirements, as well as common law, that, at any time, apply to Borrower
and/or Indemnitor or any Property and relate

 

6

 

to Hazardous Materials, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act and the
Resource Conservation and Recovery Act.

 

“Environmental
Liens” shall have the meaning set forth in Section 5.1.19(a) hereof.

 

“Environmental
Reports” shall have the meaning set forth in Section 4.1.39 hereof.

 

“ERISA” shall
mean the Employee Retirement Income Security Act of 1974, as the same may be
amended from time to time.

 

“Event of
Default” shall have the meaning set forth in Section 8.1(a) hereof.

 

“Excess Cash”
shall mean an amount equal to all funds remaining in the Lockbox Account on
each Payment Date following the disbursements and application of funds pursuant
to the terms of Section 3.7(b)(i) – (ix) hereof.

 

“Excess Cash
Reserve Account” shall have the meaning set forth in Section 3.1(b)(vii)
hereof.

 

“Excess Cash
Reserve Funds” shall have the meaning set forth in Section 7.8 hereof.

 

“Exchange Act”
shall have the meaning set forth in Section 9.2 hereof.

 

“Exchange Act
Filing” shall have the meaning set forth in Section 9.2 hereof.

 

“Extraordinary
Expense” shall mean an operating expense or capital expenditure with respect to
each Individual Property that (i) is not set forth on the Approved Annual
Budget and (ii) is not subject to payment by withdrawals from an Account.

 

“Extraordinary
Expense Reserve Account” shall have the meaning set forth in Section 3.1(b)(ix)
hereof.

 

“Extraordinary
Expense Reserve Funds” shall have the meaning set forth in Section 7.9 hereof.

 

“Fee Estate”
shall mean, with respect to any Ground Lease the fee interest of the lessor
under such Ground Lease in the Land and, if applicable, the Improvements
demised under such Ground Lease.

 

“Fee Owner”
shall mean, with respect to any Ground Lease, the owner of the lessor’s
interest in such Ground Lease and the related Fee Estate.

 

“FIRREA” shall
mean the Financial Institutions Reform, Recovery and Enforcement Act of 1989,
as the same may be amended from time to time.

 

“Fiscal Year”
shall mean each twelve (12) month period commencing on a Sunday and ending on
the Saturday closest to the 31st day of January of each year.

 

“Fitch” shall
mean Fitch, Inc.

 

7

 

“Flood
Insurance Act” shall have the meaning set forth in Section 6.1(a)(vii) hereof.

 

“Full Payment”
shall have the meaning set forth in Section 8.1(a)(i) hereof.

 

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

 

“Governmental
Authority” shall mean any court, board, agency, commission, office, central
bank or other authority of any nature whatsoever for any governmental unit
(federal, State, county, district, municipal, city, country or otherwise) or
quasi-governmental unit whether now or hereafter in existence.

 

“Ground Lease”
shall mean, individually and collectively, as the context may require, each
ground lease described on Schedule IV attached hereto and made a part
hereof as such Schedule may be amended from time to time upon the release of an
Individual Property or addition of a Substitute Property, and as such Ground
Lease may have been modified, extended and confirmed in any estoppel agreement
executed from time to time in connection therewith.

 

“Ground Lease
Escrow Fund” shall have the meaning set forth in Section 7.6 hereof.

 

“Ground Rent”
shall have the meaning set forth in Section 7.6 hereof.

 

“Ground Rent
Account” shall have the meaning set forth in Section 3.1(b)(vi) hereof.

 

“Guarantor”
shall mean Spirit Finance Corporation, a Maryland corporation, and any other
entity guaranteeing any payment or performance obligation of Borrower and
executing and delivering the Guaranty or any guaranty of the Loan.

 

“Guaranty”
shall mean that certain Guaranty of Non-Recourse Carve-Out Obligations of
Borrower, dated as of the date hereof, from Guarantor to Lender, as the same
may be amended, restated, replaced, supplemented or otherwise modified from
time to time.

 

“Hazardous
Materials” shall mean petroleum and petroleum products and compounds containing
them, including gasoline, diesel fuel and oil; explosives; flammable materials;
radioactive materials; polychlorinated biphenyls (“PCBs”) and compounds
containing them; lead and lead-based paint; asbestos or asbestos-containing
materials in any form that is or could become friable; underground or
above-ground storage tanks, whether empty or containing any substance; toxic
mold; any substance the presence of which on any Property is prohibited by any
federal, State or local authority; any substance that requires special
handling; and any other material or substance now or in the future defined as a
“hazardous substance,” “hazardous material,” “hazardous waste,” “toxic
substance,” “toxic pollutant,” “contaminant,” “pollutant” or other words of similar
import within the meaning of any Environmental Law.

 

“Holdback
Reserve Account” shall have the meaning set forth in Section 7.5 hereof.

 

“Holdback
Reserve Funds” shall have the meaning set forth in Section 7.5 hereof.

 

8

 

“Immaterial
Lease” shall mean (a) the Leases listed on Schedule VII attached hereto and (b)
any similar Lease which permits the Tenant thereunder the right to license or
lease space on the real or leased property or in the retail stores (these
leases, include, but are not limited to leases for ATMs, firework stands,
Christmas tree lots, magazine racks and other similar purposes and leases to
utilize a certain amount of retail space for promotional displays); provided,
however (i) the aggregate of the Immaterial Leases at each Individual Property
shall not be more than ten percent (10%) of total net rentable space at such
Individual Property and (ii) the Immaterial Leases shall not count towards the
limitations on assignments and/or subleases contained in the Square Footage
Limitations.

 

“Improvements”
shall have the meaning set forth in Article 1 of the related Security
Instrument with respect to each Individual Property.

 

“Indemnified
Parties” shall mean Lender, any Affiliate of Lender who is or will have been
involved in the origination of the Loan, any Person who is or will have been
involved in the servicing of the Loan, any Person in whose name the encumbrance
created by the Security Instruments is or will have been recorded, Persons who
may hold or acquire or will have held a full or partial interest in the Loan,
the holders of any Securities, as well as custodians, trustees and other
fiduciaries who hold or have held a full or partial interest in the Loan for
the benefit of third parties) as well as the respective directors, officers,
shareholders, partners, members, employees, agents, servants, representatives,
contractors, subcontractors, Affiliates, subsidiaries, participants, successors
and assigns of any and all of the foregoing (including but not limited to any
other Person who holds or acquires or will have held a participation or other
full or partial interest in the Loan or any Property, whether during the term
of the Loan or as a part of or following a foreclosure of the Loan and
including, but not limited to, any successors by merger, consolidation or
acquisition of all or a substantial portion of Lender’s assets and business).

 

“Indemnified
Taxes” shall mean any present or future income, stamp or other taxes, any
similar levies, imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or assessed by any
Governmental Authority relating to the Properties, the Leases, the Operating
Tenants or Borrower.

 

“Indemnitor”
shall mean Spirit Finance Corporation, a Maryland corporation.

 

“Independent
Director” shall have the meaning set forth in Section 4.1.35(z) hereof.

 

“Individual
Property” shall mean each parcel of real property, the Improvements thereon and
all Personal Property, if any, owned by Borrower and encumbered by a Security
Instrument, together with all rights pertaining to such Property and
Improvements, as more particularly described on Schedule I attached
hereto and in Article 1 of each Security Instrument and referred to therein as
the “Property”.  For the avoidance of
doubt, “Individual Property” shall not include Out-Parcels after they have been
released under the terms and conditions of Section 2.5.4 hereof.

 

“Individual
Store Capital Expenditure Schedule” shall have the meaning set forth in Section
5.1.10(b) hereof.

 

“Initial
Deposits” shall have the meaning set forth in Section 3.6 hereof.

 

9

 

“Insolvency
Opinion” shall mean, that certain bankruptcy non-consolidation opinion letter
delivered by counsel for Borrower in connection with the Loan and approved by
Lender or the Rating Agencies, as the case may be.

 

“Institutional
Lender” shall mean one or more of the following:

 

(a)           a
real estate investment trust, bank, saving and loan association, investment
bank, insurance company, trust company, commercial credit corporation, pension
plan, pension fund or pension advisory firm, mutual fund, government entity or
plan, provided that any such Person referred to in this clause (a) satisfies
the Eligibility Requirements;

 

(b)           an
investment company, money management firm or “qualified institutional buyer”
within the meaning of Rule 144A under the Securities Act of 1933, as amended,
or an institutional “accredited investor” within the meaning of Regulation D
under the Securities Act of 1933, as amended, provided that any such Person
referred to in this clause (b) satisfies the Eligibility Requirements;

 

(c)           an
institution substantially similar to any of the foregoing entities described in
clauses (a) or (b) that satisfies the Eligibility Requirements; or

 

(d)           any
entity Controlled by any of the entities described in clauses (a) or (c).

 

“Insurance
Deductible Letter of Credit” shall mean a Letter of Credit in an amount equal
to Four Hundred Thousand and 00/100 Dollars ($400,000.00), naming Lender as the
sole beneficiary thereof.

 

“Insurance
Premium Account” shall have the meaning set forth in Section 3.1 hereof.

 

“Insurance
Premiums” shall have the meaning set forth in Section 6.1(b) hereof.

 

“Insurance
Proceeds” shall mean the net amount of all insurance proceeds received by
Lender pursuant to Section 6.1(a)(i), (iv), (vi), (vii) and (viii) as a result
of damage or destruction, after deduction of its reasonable costs and expenses
(including, but not limited to, reasonable counsel fees), if any, in collecting
same.

 

“Investment
Grade” shall mean a rating of at least BBB- or its equivalent by each of the
Rating Agencies.

 

“Investor”
shall have the meaning set forth in Section 5.1.10(h) hereof.

 

“Leases” shall
have the meaning set forth in Article 1 of the Security Instrument with respect
to each Individual Property, including without limitation, the Operating Lease
and the Qualified Assignee Leases.

 

“Legal
Requirements” shall mean, with respect to each Individual Property, all
federal, State, county, municipal and other governmental statutes, laws, rules,
orders, regulations, ordinances, judgments, decrees and injunctions of
Governmental Authorities affecting such Individual Property or any part
thereof, or the zoning, construction, use, alteration, occupancy or

 

10

 

operation thereof, or any part thereof, whether now or hereafter
enacted and in force, and all permits, licenses and authorizations and
regulations relating thereto, and all covenants, agreements, restrictions and
encumbrances contained in any instruments, either of record or known to
Borrower, at any time in force affecting such Individual Property or any part
thereof, including, without limitation, any which may (a) require repairs,
modifications or alterations in or to such Individual Property or any part
thereof, or (b) in any way limit the use and enjoyment thereof.

 

“Lender” shall
mean, collectively, the entities designated in the introductory paragraph
hereto, together with its successors and assigns.

 

“Letter of
Credit” shall mean a transferable, clean, irrevocable, unconditional, standby
letter of credit in an amount sufficient to satisfy Borrower’s obligations from
time to time to the extent that such obligations may be satisfied by the
placement of a letter of credit as set forth herein, in form and substance
reasonably satisfactory to Lender in its reasonable discretion, issued or
confirmed by a commercial bank (the “Issuing Bank”) with a long term debt
obligation rating of “AA” or better (or a comparable long term debt obligation
rating) as assigned by the Rating Agencies and otherwise satisfactory to Lender
in its reasonable discretion (the “Minimum L/C Rating”).  The Letter of Credit shall be payable upon
presentation of a sight draft only to the order of Lender at a New York City
bank.  The Letter of Credit shall have an
initial expiration date of not less than one (1) year and shall be
automatically renewed for successive twelve (12) month periods for the term of
the Loan and shall provide for multiple draws. 
The Letter of Credit shall be transferable by Lender and its successors
and assigns at a New York City bank.

 

“Licenses”
shall have the meaning set forth in Section 4.1.21 hereof.

 

“Lien” shall
mean, with respect to each Individual Property, any mortgage, deed of trust,
lien, pledge, hypothecation, assignment, security interest, or any other
encumbrance, charge or transfer of, on or affecting Borrower, the related
Individual Property, any portion thereof or any interest therein, including,
without limitation, any conditional sale or other title retention agreement
purporting to grant a lien or right in such Individual Property, any financing
lease having substantially the same economic effect as any of the foregoing,
the filing of any financing statement, and mechanic’s, materialmen’s and other
similar liens and encumbrances.

 

“LLC Agreement”
shall have the meaning set forth in Section 4.1.35(bb) hereof.

 

“Loan” shall
mean the loan made by Lender to Borrower pursuant to this Agreement and the
other Loan Documents as the same may be amended or split pursuant to the terms
hereof.

 

“Loan
Documents” shall mean, collectively, this Agreement, the Note, the Security
Instruments, the Environmental Indemnity, the Guaranty and all other documents
executed and/or delivered in connection with the Loan.

 

“Loan to Value
Ratio” shall mean, as of the date of its calculation, the ratio of (i) the sum
of the outstanding principal amount of the Loan as of the date of such
calculation to (ii) the appraised value (according to the Appraisals delivered
in connection with the closing of the Loan) of the Properties.

 

11

 

“Lockbox
Account” shall have the meaning set forth in Section 3.1(a) hereof.

 

“Lockbox Bank”
shall mean any Eligible Institution selected by Lender.

 

“Lockbox Cash
Flow Sweep Period” shall mean the period commencing on the earlier of (i) a
1.00 EBITDAR Event and (ii) a 1.10 EBITDAR Event, and ending on a Lockbox Cash
Flow Sweep Period Termination Event.  The
determination of whether a Lockbox Cash Flow Sweep Period exists shall be
tested quarterly upon delivery of the financial statements required hereunder.

 

“Lockbox Cash
Flow Sweep Period Termination Event” shall mean the earlier to occur of (i)
payment in full of the Debt and (ii) the date that Lender determines that the
EBITDAR Ratio for Operating Tenant was equal to or greater than 1.10:1.00 for
two (2) consecutive fiscal quarters.

 

“Losses” shall
mean any and all claims, suits, liabilities (including, without limitation,
strict liabilities), actions, proceedings, obligations, debts, damages, losses,
costs, expenses, fines, penalties, charges, fees, expenses, judgments, awards,
amounts paid in settlement of whatever kind or nature (including but not
limited to reasonable attorneys’ fees and other costs of defense).

 

“Madison
Property” shall mean that certain Individual Property located at 7401 Mineral
Point Road, Madison, Wisconsin, 53717.

 

“Madison
Property Option Purchase Price” shall have the meaning set forth in Section
2.5.5 hereof.

 

“Madison
Property Option Shortfall Amount” shall have the meaning set forth in Section
2.5.5 hereof.

 

“Madison
Property Release Price” shall have the meaning set forth in Section 2.5.5
hereof.

 

“Management
Agreement” shall mean, with respect to any Individual Property, any management
agreement entered into by and between Borrower and Manager, if any, pursuant to
which the Manager is to provide management and other services with respect to
such Individual Property, or, if the context requires, the Replacement
Management Agreement executed in accordance with the terms and provisions of
this Agreement.

 

“Manager”
shall mean a Qualified Manager, if any, who is managing the Properties or any
Individual Property in accordance with the terms and provisions of this
Agreement.

 

“Material
Adverse Effect” shall mean any event or condition (other than any “go dark”
right of an Operating Tenant permitted under the Operating Leases), that has a
material adverse effect on (i) the use, value, operation or possession of any
of the Properties taken as a whole, (ii) the business, profits, operations or
condition (financial or otherwise) of Borrower or (iii) the ability of Borrower
to repay the principal and interest of the Loan as it becomes due.

 

12

 

“Maturity Date”
shall mean June 5, 2016 or such other
date on which the final payment of the principal of the Note becomes due and
payable as therein or herein provided, whether at such stated maturity date, by
declaration of acceleration, or otherwise.

 

“Maximum Legal
Rate” shall mean the maximum nonusurious interest rate, if any, that at any
time or from time to time may be contracted for, taken, reserved, charged or
received on the indebtedness evidenced by the Note and as provided for herein
or in the other Loan Documents, under the laws of such State or States whose
laws are held by any court of competent jurisdiction to govern the interest
rate provisions of the Loan.

 

“Member” shall
have the meaning set forth in Section 4.1.35(bb) hereof.

 

“Mini Report”
shall have the meaning set forth in Section 5.1.10(b) hereof.

 

“Monthly Debt
Service Payment Amount” shall mean a constant monthly payment of principal and
interest equal to Shopko $3,480,369.96.

 

“Monthly
Ground Rent Deposit” shall have the meaning set forth in Section 7.6 hereof.

 

“Monthly
Insurance Premium Deposit” shall have the meaning set forth in Section 7.2
hereof.

 

“Monthly Tax
Deposit” shall have the meaning set forth in Section 7.2 hereof.

 

“Moody’s”
shall mean Moody’s Investors Service, Inc.

 

“Net Proceeds”
shall mean (i) Insurance Proceeds or (ii) Condemnation Proceeds, whichever the
case may be.

 

“Non-Recourse
Carve-Out Obligations” shall mean all obligations and liabilities of Borrower
for which Borrower shall be personally liable pursuant to Sections 9.4(b) and
9.4(c) hereof.

 

“Non-U.S.
Entity” shall have the meaning set forth in Section 2.2.8 hereof.

 

“Note” shall
mean individually and collectively as the context may require, Note A-1, Note
A-2, Note A-3, Note A-4 and Note A-5, Note A-6.

 

“Note A-1”
shall mean that certain Amended and Restated Promissory Note (Note A-1) of even
date herewith in the original principal amount of $100,000,000.00 made by
Borrower in favor of Citi, as the same may be amended, restated, replaced,
extended, renewed, supplemented, severed, split, or otherwise modified from
time to time, including any Defeased Note and Undefeased Note that may exist
from time to time.

 

“Note A-2”
shall mean that certain Amended and Restated Promissory Note (Note A-2) of even
date herewith in the original principal amount of $100,000,000.00 made by
Borrower in favor of Barclays, as the same may be amended, restated, replaced,
extended, renewed,

 

13

 

supplemented, severed, split, or otherwise modified from time to time,
including any Defeased Note and Undefeased Note that may exist from time to
time.

 

“Note A-3”
shall mean that certain Amended and Restated Promissory Note (Note A-3) of even
date herewith in the original principal amount of $86,413,752.50 made by
Borrower in favor of Citi, as the same may be amended, restated, replaced,
extended, renewed, supplemented, severed, split, or otherwise modified from
time to time, including any Defeased Note and Undefeased Note that may exist
from time to time.

 

“Note A-4”
shall mean that certain Amended and Restated Promissory Note (Note A-4) of even
date herewith in the original principal amount of $86,413,752.50 made by
Borrower in favor of Barclays, as the same may be amended, restated, replaced,
extended, renewed, supplemented, severed, split, or otherwise modified from
time to time, including any Defeased Note and Undefeased Note that may exist
from time to time.

 

“Note A-5”
shall mean that certain Amended and Restated Promissory Note (Note A-5) of even
date herewith in the original principal amount of $86,413,752.50 made by
Borrower in favor of Citi, as the same may be amended, restated, replaced,
extended, renewed, supplemented, severed, split, or otherwise modified from
time to time, including any Defeased Note and Undefeased Note that may exist
from time to time.

 

“Note A-6”
shall mean that certain Amended and Restated Promissory Note (Note A-6) of even
date herewith in the original principal amount of $86,413,752.50 made by
Borrower in favor of Barclays, as the same may be amended, restated, replaced,
extended, renewed, supplemented, severed, split, or otherwise modified from
time to time, including any Defeased Note and Undefeased Note that may exist
from time to time.

 

“Obligations” shall mean Borrower’s
obligation to pay the Debt and perform its obligations under the Note, this
Agreement and the other Loan Documents.

 

“Officer’s
Certificate” shall mean a certificate delivered to Lender by Borrower which is
signed by a Responsible Officer of Borrower.

 

“Operating
Expenses” shall mean the total of all expenditures, computed in accordance with
GAAP, of whatever kind relating to the operation, maintenance and management of
the Properties that are incurred on a regular monthly or other periodic basis,
including without limitation, utilities, ordinary repairs and maintenance,
insurance premiums, license fees, property taxes and assessments, advertising
and marketing expenses, franchise fees, management fees, payroll and related
taxes, computer processing charges, operational equipment or other lease
payments which are part of the Approved Annual Budget, if required, and other
similar costs, but excluding depreciation, Debt Service, Capital Expenditures
and contributions to the Reserve Funds.

 

“Operating
Expense Reserve Account” shall have the meaning set forth in Section
3.1(b)(viii) hereof.

 

“Operating
Expense Reserve Funds” shall have the meaning set forth in Section 7.9 hereof.

 

14

 

“Operating
Lease” shall mean, that certain Master Lease dated as of the date hereof,
between ShopKo Stores Operating Co., LLC, as tenant, and Borrower, as landlord,
relating to the Properties.

 

“Operating
Tenant” shall mean ShopKo Stores Operating Co., LLC.

 

“Other Charges”
shall mean all Ground Rents, maintenance charges, impositions other than Taxes,
and any other charges now or hereafter levied or assessed or imposed against
such Individual Property or any part thereof.

 

“Out Parcel”
shall mean each parcel of land shown on Schedule V attached hereto and
made a part hereof.

 

“Out Parcel
Release” shall have the meaning set forth in Section 2.5.3 hereof.

 

“P&L
Report” shall mean a report in substantially the form attached hereto as Exhibit
C for the immediately preceding twelve (12) month period.

 

“Payment Date”
shall mean the fifth (5th) day of each calendar month during the term of the
Loan or, if such day is not a Business Day, the immediately succeeding Business
Day.

 

“Permitted
Defeasance Date” shall mean the date that is the earlier of (a) four (4) years
from the Closing Date or (b) two (2) years from the “startup day” within the
meaning of Section 860G(a)(9) of the Code of the REMIC Trust.

 

“Permitted
Encumbrances” shall mean, with respect to an Individual Property, collectively,
(a) the Liens and security interests created by the Loan Documents, (b) all
Liens, encumbrances and other matters disclosed in the Title Insurance Policy
relating to such Individual Property or any part thereof, (c) Liens, if any,
for Taxes imposed by any Governmental Authority not yet delinquent, (d) such
other title and survey exceptions as Lender has approved or may approve in
writing in Lender’s sole discretion, (e) carriers’, warehousemen’s, mechanics’,
materialmen’s, repairmen’s or other like Liens arising in the ordinary course
of business which are either (i) not overdue or (ii) are being contested in
good faith in accordance with the terms hereof or which have been fully insured
over to Lender by the title company issuing the Title Policy and, if required
by Lender, evidence satisfactory to Lender of the foregoing, (f) any interest
of a lessor under any Lease entered into in accordance with the terms hereof,
(g) Liens arising solely by virtue of any statutory or common law provision
relating to banker’s liens, rights of set-off or similar rights and remedies as
to deposit accounts or other funds maintained with a creditor depository
institution; provided that (i) such deposit account is not a dedicated cash
collateral account and is not subject to restrictions against access by
Borrower in excess of those set forth by regulations promulgated by the Federal
Reserve Board, and (ii) such deposit account is not intended by Borrower or any
of its Affiliates to provide collateral to the depository institution, (h) easements, rights-of-way, restrictions
and other similar encumbrances incurred in the ordinary course of business, so
long as any such easements, rights-of-way or other similar encumbrances
affecting any Individual Property or any other real property material to the
business of Borrower or any of their subsidiaries are not, in the aggregate,
substantial in amount and do not in any case materially detract from the value
of the Individual Property subject thereto or materially interfere with the
ordinary conduct of the

 

15

 

business of Borrower, any Operating Tenant,
any Qualified Assignee and any Qualified Subtenant or any of their subsidiaries
or which are otherwise insured over by title insurance endorsements reasonably
acceptable to Lender or (i) pledges and deposits of cash after the date hereof
to secure obligations under appeal bonds or as otherwise required in connection
with court proceedings (including, without limitation, surety bonds, security
for costs of litigation where required by law and letters of credit) or any
other instruments serving a similar purpose and (iii) any judgment in
connection with which such appeal bond or other instruments are required shall
not constitute an Event of Default.

 

“Permitted
Investments” shall mean any one or more of the following obligations or
securities acquired at a purchase price of not greater than par, including
those issued by Servicer, the trustee under any Securitization or any of their
respective Affiliates, payable on demand or having a maturity date not later
than the Business Day immediately prior to the first Payment Date following the
date of acquiring such investment and meeting one of the appropriate standards
set forth below:

 

(i)               obligations
of, or obligations fully guaranteed as to payment of principal and interest by,
the United States or any agency or instrumentality thereof provided such
obligations are backed by the full faith and credit of the United States of
America including, without limitation, obligations of: the U.S. Treasury (all
direct or fully guaranteed obligations), the Farmers Home Administration
(certificates of beneficial ownership), the General Services Administration
(participation certificates), the U.S. Maritime Administration (guaranteed
Title XI financing), the Small Business Administration (guaranteed
participation certificates and guaranteed pool certificates), the U.S.
Department of Housing and Urban Development (local authority bonds) and the
Washington Metropolitan Area Transit Authority (guaranteed transit bonds); provided,
however, that the investments described in this clause must (A) have a
predetermined fixed dollar of principal due at maturity that cannot vary or
change, (B) if rated by S&P, must not have an “r” highlighter affixed to
their rating, (C) if such investments have a variable rate of interest, such
interest rate must be tied to a single interest rate index plus a fixed spread
(if any) and must move proportionately with that index, and (D) such
investments must not be subject to liquidation prior to their maturity;

 

(ii)              Federal
Housing Administration debentures;

 

(iii)             obligations
of the following United States government sponsored agencies: Federal Home Loan
Mortgage Corp. (debt obligations), the Farm Credit System (consolidated
systemwide bonds and notes), the Federal Home Loan Banks (consolidated debt obligations),
the Federal National Mortgage Association (debt obligations), the Financing
Corp. (debt obligations), and the Resolution Funding Corp. (debt obligations); provided,
however, that the investments described in this clause must (A) have a
predetermined fixed dollar of principal due at maturity that cannot vary or
change, (B) if rated by S&P, must not have an “r” highlighter affixed to
their rating, (C) if such investments have a variable rate of interest, such
interest rate must be tied to a single interest rate index plus a fixed spread
(if any)

 

16

 

and must move proportionately with that
index, and (D) such investments must not be subject to liquidation prior to
their maturity;

 

(iv)             federal
funds, unsecured certificates of deposit, time deposits, bankers’ acceptances
and repurchase agreements with maturities of not more than 365 days of any
bank, the short term obligations of which at all times are rated in the highest
short term rating category by each Rating Agency (or, if not rated by all
Rating Agencies, rated by at least one Rating Agency in the highest short term
rating category and otherwise acceptable to each other Rating Agency, as
confirmed in writing that such investment would not, in and of itself, result
in a downgrade, qualification or withdrawal of the initial, or, if higher, then
current ratings assigned to the Securities); provided, however,
that the investments described in this clause must (A) have a predetermined
fixed dollar of principal due at maturity that cannot vary or change, (B) if
rated by S&P, must not have an “r” highlighter affixed to their rating, (C)
if such investments have a variable rate of interest, such interest rate must
be tied to a single interest rate index plus a fixed spread (if any) and must
move proportionately with that index, and (D) such investments must not be
subject to liquidation prior to their maturity;

 

(v)              fully
Federal Deposit Insurance Corporation-insured demand and time deposits in, or
certificates of deposit of, or bankers’ acceptances with maturities of not more
than 365 days and issued by, any bank or trust company, savings and loan
association or savings bank, the short term obligations of which at all times
are rated in the highest short term rating category by each Rating Agency (or,
if not rated by all Rating Agencies, rated by at least one Rating Agency in the
highest short term rating category and otherwise acceptable to each other
Rating Agency, as confirmed in writing that such investment would not, in and
of itself, result in a downgrade, qualification or withdrawal of the initial,
or, if higher, then current ratings assigned to the Securities); provided,
however, that the investments described in this clause must (A) have a
predetermined fixed dollar of principal due at maturity that cannot vary or
change, (B) if rated by S&P, must not have an “r” highlighter affixed to
their rating, (C) if such investments have a variable rate of interest, such
interest rate must be tied to a single interest rate index plus a fixed spread
(if any) and must move proportionately with that index, and (D) such
investments must not be subject to liquidation prior to their maturity;

 

(vi)             debt
obligations with maturities of not more than 365 days and at all times rated by
each Rating Agency (or, if not rated by all Rating Agencies, rated by at least
one Rating Agency and otherwise acceptable to each other Rating Agency, as
confirmed in writing that such investment would not, in and of itself, result
in a downgrade, qualification or withdrawal of the initial, or, if higher, then
current ratings assigned to the Securities) in its highest long-term unsecured
rating category; provided, however, that the investments
described in this clause must (A) have a predetermined fixed dollar of
principal due at maturity that cannot vary or change, (B) if rated by S&P,
must not have an “r” highlighter affixed to their rating, (C) if such
investments have a variable rate of interest, such interest rate must be tied
to a single interest rate index plus a fixed spread (if any) and must

 

17

 

move proportionately with that index, and (D) such investments must not
be subject to liquidation prior to their maturity;

 

(vii)            commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on demand or on a
specified date not more than one year after the date of issuance thereof) with
maturities of not more than 365 days and that at all times is rated by each
Rating Agency (or, if not rated by all Rating Agencies, rated by at least one
Rating Agency and otherwise acceptable to each other Rating Agency, as
confirmed in writing that such investment would not, in and of itself, result
in a downgrade, qualification or withdrawal of the initial, or, if higher, then
current ratings assigned to the Securities) in its highest short-term unsecured
debt rating; provided, however, that the investments described in
this clause must (A) have a predetermined fixed dollar of principal due at
maturity that cannot vary or change, (B) if rated by S&P, must not have an “r”
highlighter affixed to their rating, (C) if such investments have a variable
rate of interest, such interest rate must be tied to a single interest rate
index plus a fixed spread (if any) and must move proportionately with that
index, and (D) such investments must not be subject to liquidation prior to
their maturity;

 

(viii)           units of taxable money market funds,
with maturities of not more than 365 days and which funds are regulated
investment companies, seek to maintain a constant net asset value per share and
invest solely in obligations backed by the full faith and credit of the United
States, which funds have the highest rating available from each Rating Agency
(or, if not rated by all Rating Agencies, rated by at least one Rating Agency
and otherwise acceptable to each other Rating Agency, as confirmed in writing
that such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the initial, or, if higher, then current ratings
assigned to the Securities) for money market funds; and

 

(ix)             any other security, obligation or investment which has
been approved as a Permitted Investment in writing by (a) Lender and (b) if a
Securitization has occurred, each Rating Agency, as evidenced by a written
confirmation that the designation of such security, obligation or investment as
a Permitted Investment will not, in and of itself, result in a downgrade,
qualification or withdrawal of the initial, or, if higher, then current ratings
assigned to the Securities by such Rating Agency;

 

provided, however,
that no obligation or security shall be a Permitted Investment if (A) such
obligation or security evidences a right to receive only interest payments or
(B) the right to receive principal and interest payments on such obligation or security
are derived from an underlying investment that provides a yield to maturity in
excess of 120% of the yield to maturity at par of such underlying investment.

 

“Person” shall mean any
individual, corporation, partnership, joint venture, limited liability company,
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.

 

18

 

“Personal Property” shall
have the meaning set forth in Article 1 of the Security Instrument with respect
to each Individual Property.  “Personal
Property” shall not include any personal property owned by a Tenant under a Lease.

 

“Physical Conditions Report”
shall mean, with respect to each Individual Property, a structural engineering
report prepared by a company satisfactory to Lender regarding the physical
condition of such Individual Property, satisfactory in form and substance to
Lender in its sole discretion, which report shall, among other things, (a)
confirm that such Individual Property and its use complies, in all material
respects, with all applicable Legal Requirements (including, without
limitation, zoning, subdivision and building laws) and (b) include a copy of a
final certificate of occupancy with respect to all Improvements on such
Individual Property.

 

“Plan” shall mean an
employee benefit plan (as defined in section 3(3) of ERISA) whether or not
subject to ERISA or a plan or other arrangement within the meaning of section
4975 of the Code.

 

“Plan Assets” shall mean
assets of a Plan within the meaning of section 29 C.F.R. section 2510.3-101 or
similar law.

 

“Policies” shall have the
meaning set forth in Section 6.1(b) hereof.

 

“Prepayment Date” shall have
the meaning set forth in Section 2.3.1 hereof.

 

“Principal” shall have the
meaning set forth in Section 4.1.35 hereof, together with its successors and
assigns.

 

“Prohibited Person” shall
mean any Person:

 

(x)              listed in the Annex to, or otherwise subject to the
provisions of, Executive Order No. 13224 on Terrorist Financing, effective
September 24, 2001, and relating to Blocking Property and Prohibiting
Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism
(the “Executive Order”);

 

(xi)             that is owned or controlled by, or acting for or on
behalf of, any person or entity that is listed to the Annex to, or is otherwise
subject to the provisions of, the Executive Order;

 

(xii)            with whom Lender is prohibited from dealing or otherwise
engaging in any transaction by any terrorism or money laundering law, including
the Executive Order;

 

(xiii)           who commits, threatens or conspires
to commit or supports “terrorism” as defined in the Executive Order;

 

(xiv)           that is named as a “specially designated national and
blocked person” on the most current list published by the U.S. Treasury
Department Office of Foreign Assets Control at its official website,

 

19

 

http://www.treas.gov.ofac/t11sdn.pdf or at any replacement website or
other replacement official publication of such list; or

 

(xv)            who is an Affiliate of or affiliated with a Person listed
above.

 

“Properties” shall mean,
collectively, each and every Individual Property which is subject to the terms
of this Agreement.

 

“Property” shall mean, as
the context may require, the Properties or an Individual Property.

 

“Property Account” shall
have the meaning set forth in Section 3.1(a) hereof.

 

“Property Account Control
Agreement” shall have the meaning set forth in Section 3.1(a) hereof.

 

“Property Account Bank”
shall mean PNC Bank, National Association, provided that it remains an Eligible
Institution, and any successor Eligible Institution or other Eligible Institution
selected by Borrower, subject to Lender’s approval.

 

“Provided Information” shall
have the meaning set forth in Section 9.1(a) hereof.

 

“Qualified Assignee” shall
have the meaning set forth in Section 5.1.17(b) hereof.

 

“Qualified Assignee Lease” shall
have the meaning set forth in Section 5.1.17(b) hereof.

 

“Qualified Insurer” shall
have the meaning set forth in Section 6.1(b) hereof.

 

“Qualified Investor” shall
mean any one of the following Persons:

 

(a)           a real estate investment trust, investment bank, trust
company, commercial credit corporation, mutual fund, investment company, money
management firm, “qualified institutional buyer” within the meaning of Rule
144A under the Securities Act of 1933, as amended, institutional “accredited
investor” within the meaning of Regulation D under the Securities Act of 1933,
as amended, government plan, pension fund, pension plan, pension trust or
pension account that (i) has total real estate assets of at least $600 Million
and (ii) is managed by a Person who controls at least $600 Million of real
estate equity assets; or

 

(b)           a pension fund advisor who (i) immediately prior to such
transfer, controls at least $600 Million of real estate equity assets and (ii)
is acting on behalf of one or more pension funds that, in the aggregate,
satisfy the requirements of clause (a) of this definition; or

 

(c)           an insurance company which is subject to supervision by
the insurance commissioner, or a similar official or agency, of a state or
territory of the United States (including the District of Columbia) (i) with a
net worth, as of a date no more than six (6) months prior to the date of the
transfer, of at least $300 Million and (ii) who, immediately prior to such
transfer, controls real estate equity assets of at least $600 Million; or

 

20

 

(d)           a corporation organized under the banking laws of the
United States or any state or territory of the United States (including the
District of Columbia) (i) with a combined capital and surplus of at least $300
Million and (ii) who, immediately prior to such transfer, controls real estate
equity assets of at least $600 Million;

 

(e)           any Person with a long-term unsecured debt rating from the
Rating Agencies of at least Investment Grade; or

 

(f)            an institution substantially similar to any of the
Persons described in clauses (a) through (e) of this definition.

 

“Qualified Manager” shall
mean, if any, a reputable and experienced professional management organization
(a) which manages, together with its Affiliates, a substantial number of
properties of a type, quality and size similar to the Properties, exclusive of
the Properties (b) approved by Lender, and for which Lender shall have received
(i) written confirmation from the Rating Agencies that the employment of such
manager will not result in a downgrade, withdrawal or qualification of the
initial, or if higher, then current ratings issued in connection with a
Securitization, or if a Securitization has not occurred, any ratings to be
assigned in connection with a Securitization, and (ii) with respect to any
Affiliated Manager, a revised Insolvency Opinion.

 

“Qualified Subtenant” shall
mean a subtenant under the sublease entered into in accordance with the terms
hereof which (i) has an investment rating of BBB or better from S&P (or an
equivalent rating or shadow rating from another nationally recognized
statistical rating organization) or (ii) at the time of the proposed sublease
is a reputable, creditworthy subtenant, as determined by Lender and meets or
exceeds a corporate EBITDAR Ratio of 1.25:1.00 or (iii) has a corporate GAAP
net worth of at least equal to $25,000,000.00; provided, however, that the
foregoing conditions may be satisfied by a Person that guarantees the lease
obligations of the proposed subtenant.

 

“Qualified Transferee” shall
mean any one of the following Persons:

 

(i)               a pension fund, pension trust or pension account that
(a) has total real estate assets of at least $1 Billion and (b) is managed by a
Person who controls at least $1 Billion of real estate equity assets; or

 

(ii)              a pension fund advisor who (a) immediately prior to
such transfer, controls at least $1 Billion of real estate equity assets and
(b) is acting on behalf of one or more pension funds that, in the aggregate,
satisfy the requirements of clause (i) of this definition; or

 

(iii)             an insurance company which is subject to supervision by
the insurance commissioner, or a similar official or agency, of a state or
territory of the United States (including the District of Columbia) (a) with a
net worth, as of a date no more than six (6) months prior to the date of the
transfer, of at least $750 Million and (b) who, immediately prior to such
transfer, controls real estate equity assets of at least $1 Billion;

 

21

 

(iv)             a corporation organized under the banking laws of the
United States or any state or territory of the United States (including the
District of Columbia) (a) with a combined capital and surplus of at least $750 Million
and (b) who, immediately prior to such transfer, controls real estate equity
assets of at least $1 Billion;

 

(v)              a real estate investment trust (a) with a net worth,
immediately prior to the date of the transfer, of at least $750 Million and (b)
who, immediately prior to such transfer, controls real estate equity assets of
at least $1 Billion; or

 

(vi)             any Person (a) with a long-term unsecured debt rating
from the Rating Agencies of at least Investment Grade or (b) who (x) is, or,
simultaneously with the applicable transfer enters into a Management Agreement
with, a Qualified Manager, (y) has a net worth, as of a date no more than six
(6) months prior to the date of such transfer, of at least $750 Million and (z)
immediately prior to such transfer, controls real estate assets of at least $2
Billion.

 

“Rating Agencies” shall mean
each of S&P, Moody’s, and Fitch, and any other nationally-recognized
statistical rating agency which has been approved by Lender and has rated the
Securities.

 

“Reimbursement Contribution”
shall have the meaning set forth in Section 9.5(c) hereof.

 

“Release” of any Hazardous
Materials shall mean any release, deposit, discharge, emission, leaking,
spilling, seeping, migrating, injecting, pumping, pouring, emptying, escaping,
dumping, disposing or other movement of Hazardous Materials.

 

“Release Price” shall mean,
with respect to each Individual Property, one hundred twenty percent (120%) of
the Allocated Loan Amount for such Individual Property; provided, however, with
respect to a sale of the Madison Property pursuant to Section 2.5.5 hereof, the
Release Price shall be equal the greater of (i) one hundred percent (100%) of
the Allocated Loan Amount for the Madison Property and (ii) the Madison
Property Option Purchase Price; provided that, in no event will the Release
Price for the Madison Property exceed one hundred twenty percent (120%) of the
Allocated Loan Amount for the Madison Property.

 

“Remaining Property” shall
have the meaning set forth in Section 2.5.4 hereof.

 

“REMIC Trust” shall mean a “real
estate mortgage investment conduit” within the meaning of Section 860D of the
Code that holds the Note.

 

“Rents” shall have the
meaning set forth in Article 1 of the Security Instrument with respect to each
Individual Property.

 

“Replaced Property” shall
have the meaning set forth in Section 2.6 hereof.

 

“Replacement Management
Agreement” shall mean, collectively, (a) either (i) a management agreement with
a Qualified Manager substantially in the same form and substance as the Management
Agreement, or (ii) a management agreement with a Qualified Manager,

 

22

 

which
management agreement shall be acceptable to Lender in form and substance,
provided, with respect to this subclause (ii), Lender, at its option, may
require that Borrower obtain confirmation from the applicable Rating Agencies
that such management agreement will not result in a downgrade, withdrawal or
qualification of the initial, or if higher, then current rating of the Securities
or any class thereof; (b) a conditional assignment of management agreement
substantially in the form of the Assignment of Management Agreement (or such
other form acceptable to Lender), executed and delivered to Lender by Borrower
and such Qualified Manager at Borrower’s expense and (c) if such replacement
manager is an Affiliated Manager, Borrower shall have delivered, or cause to be
delivered, to Lender, an updated Insolvency Opinion acceptable to Lender with
respect to such Affiliated Manager.

 

“Replacement
Rent” shall mean initial rents which are market rates, but in no event less
than the Determined Minimum Rent.

 

“Replacement Reserve Account”
shall have the meaning set forth in Section 3.1(b)(iv) hereof.

 

“Replacement Reserve Fund”
shall have the meaning set forth in Section 7.3.1 hereof.

 

“Replacement Reserve Monthly
Deposit” shall have the meaning set forth in Section 7.3.1 hereof.

 

“Replacements” shall have
the meaning set forth in Section 7.3.1 hereof.

 

“Required Deposits” shall
mean all rent (including, without limitation, base rent and additional rent)
and all other charges due and payable to Borrower pursuant to the Leases.

 

“Required Excess Cash” shall
mean (i) in the event (a) the Lockbox Cash Flow Sweep Period occurred as a
result of a 1.00 EBITDAR Event or (b) a 1.10 EBITDAR Event has become a 1.00
EBITDAR Event, one hundred percent (100%) of all Excess Cash and (ii) in the
event the Lockbox Cash Flow Sweep Period occurred as a result of a 1.10 EBITDAR
Event, fifty percent (50%) of all Excess Cash.

 

“Required Out-Parcel Officer’s
Certificate” shall have the meaning set forth in Section 2.5.3 hereof.

 

“Required Repair Account”
shall have the meaning set forth in Section 3.1(b)(v) hereof.

 

“Required Repair Fund” shall
have the meaning set forth in Section 7.1.1 hereof.

 

“Required Repairs” shall
have the meaning set forth in Section 7.1.1 hereof.

 

“Reserve Fund Deposits”
shall mean the amounts to be deposited into the Reserve Funds for any given
month or at any other time as provided in this Agreement or in the other Loan
Documents.

 

“Reserve Funds” shall mean
the Tax and Insurance Escrow Funds, the Replacement Reserve Funds, the Required
Repair Funds, the Excess Cash Reserve Funds, the Operating

 

23

 

Expense
Reserve Funds, the Extraordinary Expense Reserve Funds, the Ground Rent Escrow
Fund or any other escrow funds established by the Loan Documents.

 

“Responsible Officer” means
with respect to a Person, the chairman of the board, president, chief operating
officer, chief financial officer, controller, treasurer or vice
president-finance or other senior vice president of such Person.

 

“Restoration” shall mean the
repair and restoration of an Individual Property after a Casualty or
Condemnation as nearly as possible to the condition the Individual Property was
in immediately prior to such Casualty or Condemnation, with such alterations as
may be made pursuant to the provisions of the Operating Lease, provided that
the Operating Lease is not in default, or, if not allowed or required to be
restored by the Operating Tenant under the Operating Lease, as such restoration
may otherwise be approved by Lender in accordance with the standards and
conditions set forth herein.

 

“Restoration Threshold”
shall mean $1,000,000.00 for each Individual Property; provided that the
Restoration threshold shall be increased annually by any increase in the CPI
Index.

 

“Restricted Party” shall
mean Borrower, Principal, or any Affiliated Manager or any shareholder,
partner, member or non-member manager, or any direct or indirect legal or
beneficial owner of, Borrower, Principal, any Affiliated Manager or any
non-member manager; provided,
however, no direct or indirect legal or beneficial owner of Sponsor shall be
deemed to be a Restricted Party.

 

“S&P” shall mean
Standard & Poor’s Ratings Services, a division of McGraw-Hill, Inc.

 

“Sale or Pledge” shall mean
a voluntary or involuntary sale, conveyance, transfer or pledge of a direct or
indirect legal or beneficial interest.

 

“Scheduled Defeasance
Payments” shall have the meaning set forth in Section 2.4.1(b) hereof.

 

“Secured Line of Credit”
shall have the meaning set forth in Seciton 5.2.10(e) hereof.

 

“Securities” shall have the
meaning set forth in Section 9.1 hereof.

 

“Securitization” shall have
the meaning set forth in Section 9.1 hereof.

 

“Securities Act” shall have
the meaning set forth in Section 9.2 hereof.

 

“Security Instrument” shall
mean, with respect to each Individual Property, that certain first priority
Mortgage (or Deed of Trust or Deed to Secure Debt, as applicable, as the same
may be amended and restated) and Security Agreement, executed and delivered by
Borrower as security for the Loan and encumbering such Individual Property, as
the same may be amended, restated, replaced, supplemented or otherwise modified
from time to time.

 

“Security Instruments”
means, collectively, each and every Security Instrument executed and delivered
by Borrower as security for the Loan and encumbering all of the Properties.

 

24

 

“Servicer” shall have the
meaning set forth in Section 9.3 hereof.

 

“Servicing Agreement” shall
have the meaning set forth in Section 9.3 hereof.

 

“Severed Loan Documents”
shall have the meaning set forth in Section 8.2(c) hereof.

 

“Special Member” shall have
the meaning set forth in Section 4.1.35(cc) hereof.

 

“Sponsor” shall mean Spirit
Finance Corporation, a Maryland corporation.

 

“Square Footage Limitation”
shall mean the aggregate combined amount (by square foot) of rentable space
that can be assigned, sublet or substituted may not exceed twenty percent (20%)
in any one calendar year and thirty percent (30%) over the term of the
Operating Leases.  For purposes of clarification,
the maximum amount of rentable square footage in the Operating Leases that can
be assigned, sublet or substituted in any one calendar year is limited to
twenty percent (20%) of the aggregate amount of rentable square footage of the
building(s) covered by the Operating Leases and the maximum amount of rentable
square footage of the building(s) in the Operating Leases that can be assigned,
sublet or substituted over the term of the Operating Leases is limited to
thirty percent (30%) of the aggregate amount of rentable square footage of the
building(s) covered by the Operating Leases. 
The Square Footage Limitations shall not include or apply to (i)
Immaterial Leases, (ii) Individual Properties at which the Operating Tenant has
ceased operations (or has “gone dark”) as permitted under the Operating Lease,
and (iii) any subleases existing as of the Closing Date.

 

“State” shall mean, with
respect to an Individual Property, the State or Commonwealth in which such
Individual Property or any part thereof is located.

 

“Substitute Property” shall
have the meaning set forth in Section 2.6 hereof.

 

“Successor Borrower” shall
have the meaning set forth in Section 2.4.2 hereof.

 

“Survey” shall mean, with
respect to an Individual Property, either (i) a survey prepared by a surveyor
licensed in the State and satisfactory to Lender and the company or companies
issuing the Title Insurance Policies, and containing a certification of such
surveyor satisfactory to Lender or (ii) an Express Map.

 

“Tax Account” shall have the
meaning set forth in Section 3.1 hereof.

 

“Tax and Insurance Escrow
Fund” shall have the meaning set forth in Section 7.2 hereof.

 

“Taxes” shall mean all real
estate and personal property taxes, assessments, water rates or sewer rents,
now or hereafter levied or assessed or imposed against any Individual Property
or part thereof.

 

“Tenant” shall mean any
Person leasing, subleasing or otherwise occupying any portion of any Individual
Property under a Lease or other occupancy agreement, including, without
limitation, an Operating Tenant, a Qualified Assignee and a Qualified
Subtenant.

 

25

 

“Terrorism Insurance” shall
have the meaning set forth in Section 6.1(b) hereof.

 

“Terrorism Insurance Cap”
shall have the meaning set forth in Section 6.1(b) hereof.

 

“Title Insurance Policy”
shall mean, with respect to each Individual Property, an ALTA mortgagee title
insurance policy in a form acceptable to Lender (or, if an Individual Property
is located in a State which does not permit the issuance of such ALTA policy,
such form as shall be permitted in such State and acceptable to Lender) issued
with respect to such Individual Property and insuring the lien of the Security
Instrument encumbering such Individual Property.

 

“Transfer” shall have the
meaning set forth in Section 5.2.10(a) hereof.

 

“Transferee” shall have the
meaning set forth in Section 5.2.11(b) hereof.

 

“Triggering Event” shall
mean the earlier to occur of (i) the date that Lender determines, based on the
financial statements delivered to Lender in accordance with the terms hereof,
the EBITDAR Ratio for the Operating Tenant is less than or equal to 1.15:1.00
(the “EBITDAR Event”); provided that Borrower shall not be required to commence
making Reserve Fund Deposits until the earlier to occur of (A) Borrower’s
receipt of Operating Tenant’s reserve payments under the Operating Lease or (B)
the third (3rd) successive Payment Date after the EBITDAR Event; (ii) an
uncured monetary event of default exists under the Operating Lease or (iii) an
Event of Default has occurred and is continuing.

 

“Triggering Event Period”
shall mean the period commencing on the occurrence of a Triggering Event and
ending on a Triggering Event Termination Event. 
The determination of whether a Triggering Event Period exists shall be
tested quarterly upon delivery of the financial statements required hereunder.

 

“Triggering Event
Termination Event” shall mean the earlier to occur of (i) payment in full of
the Debt and (ii)(1) the date that Lender determines that the EBITDAR Ratio for
Operating Tenant was equal to or greater than 1.15:1.00 for a period of four
(4) consecutive fiscal quarters and (2) no monetary default exists under the
Operating Lease.

 

“UCC” or “Uniform Commercial
Code” shall mean the Uniform Commercial Code as in effect in the State in which
an Individual Property is located.

 

“Undefeased Note” shall have
the meaning set forth in Section 2.4.1(a)(v) hereof.

 

“U.S. Obligations” shall
mean direct non-callable obligations of the United States of America.

 

“USPAP” shall mean the
Uniform Standard of Professional Appraisal Practice.

 

“Yield Maintenance Premium”
shall mean the amount (if any) which, when added to the remaining principal
amount of the Note or the principal amount of the Undefeased Note (as
applicable), will be sufficient to purchase Defeasance Collateral providing the
required Scheduled Defeasance Payments.

 

26

 

Section
1.2            Principles of
Construction.

 

All references to sections
and schedules are to sections and schedules in or to this Agreement unless
otherwise specified.  All uses of the
word “including” shall mean “including, without limitation” unless the context
shall indicate otherwise.  Unless
otherwise specified, the words “hereof,” “herein” and “hereunder” and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement.  Unless otherwise specified, all meanings
attributed to defined terms herein shall be equally applicable to both the
singular and plural forms of the terms so defined.

 

II.            GENERAL TERMS

 

Section
2.1            Loan Commitment;
Disbursement to Borrower.

 

2.1.1        Agreement to Lend and Borrow.

 

Subject to and upon the
terms and conditions set forth herein, Lender hereby agrees to make and
Borrower hereby agrees to accept the Loan on the Closing Date.

 

2.1.2        Single Disbursement to Borrower.

 

Borrower may request and
receive only one borrowing hereunder in respect of the Loan and any amount
borrowed and repaid hereunder in respect of the Loan may not be re-borrowed.

 

2.1.3        The Note, Security Instruments and Loan
Documents.

 

The Loan shall be evidenced
by the Note and secured by the Security Instruments and the other Loan
Documents.

 

2.1.4        Use of Proceeds.

 

Borrower shall use the
proceeds of the Loan to (a) repay and discharge any existing loans relating to
the Properties, (b) pay all past-due Basic Carrying Costs, if any, with respect
to the Properties, (c) make deposits into the Reserve Funds on the Closing Date
in the amounts provided herein or in the other Loan Documents, (d) pay costs
and expenses incurred in connection with the closing of the Loan, as approved
by Lender, or (e) fund any working capital requirements of the Properties.  The balance, if any, shall be distributed to
Borrower.

 

Section
2.2            Interest; Loan
Payments; Late Payment Charge.

 

2.2.1        Payments.

 

(a)           Interest on the outstanding principal balance of the Loan
shall accrue from the Closing Date to but excluding the Maturity Date at the
Applicable Interest Rate.  The Monthly
Debt Service Payment Amount shall be paid on each Payment Date commencing on
July 5, 2006 and on each subsequent Payment Date thereafter up to and including
the Maturity Date, which payments shall be applied first to accrued and unpaid interest
and the balance to principal.  Interest
on the outstanding principal amount of the

 

27

 

Loan for the period through and including June 5, 2006 shall be paid by
Borrower on the date hereof. Each installment of the Monthly Debt Service
Payment Amount shall be applied by Lender, pro rata, to
the payment of (i) accrued and unpaid interest on the outstanding
principal balance and (ii) scheduled amortization of Note A-1, Note A-2, Note
A-3, Note A-4, Note A-5, and Note A-6 at the Applicable Interest Rate.

 

(b)           All payments and other amounts due under the Note, this
Agreement and the other Loan Documents shall be made without any setoff,
defense or irrespective of, and without deduction for, counterclaims.

 

2.2.2        Interest Calculation.

 

Interest on the outstanding
principal balance of the Loan shall be calculated by multiplying (a) the actual
number of days elapsed in the period for which the calculation is being made by
(b) a daily rate equal to the Applicable Interest Rate divided by three hundred
sixty (360) by (c) the outstanding principal balance.

 

2.2.3        Payment on Maturity Date.

 

Borrower shall pay to Lender on the Maturity Date the
outstanding principal balance, all accrued and unpaid interest thereon, and all
other amounts due hereunder and under the Note, the Security Instruments and
the other Loan Documents.

 

2.2.4        Payments after Default.

 

Upon the occurrence and
during the continuance of an Event of Default, interest on the outstanding
principal balance of the Loan and, to the extent permitted by Applicable Law,
overdue interest and other amounts due in respect of the Loan, shall accrue at
the Default Rate, calculated from the date such payment was due without regard
to any grace or cure periods contained herein. 
Interest at the Default Rate shall be computed from the occurrence of
the default until the actual receipt and collection of the Debt (or that
portion thereof that is then due).  To
the extent permitted by Applicable Law, interest at the Default Rate shall be
added to the Debt, shall itself accrue interest at the same rate as the Loan
and shall be secured by the Security Instruments.  This paragraph shall not be construed as an
agreement or privilege to extend the date of the payment of the Debt, nor as a
waiver of any other right or remedy accruing to Lender by reason of the
occurrence of any Event of Default. Notwithstanding anything to the contrary
contained herein, any amounts paid to or received by Lender in connection with
the Loan during the continuation of an Event of Default shall be applied by
Lender to the Debt in the following order of priority:

 

First, pro rata,
to the payment of interest on the outstanding principal balances of Note A-1,
Note A-2, Note A-3, Note A-4, Note A-5 and Note A-6 at the Applicable Interest
Rate;

 

Second, pro rata,
to the payment of the outstanding principal balances of Note A-1, Note A-2,
Note A-3, Note A-4, Note A-5 and Note A-6 until Note A-1, Note A-2, Note A-3,
Note A-4, Note A-5 and Note A-6 are reduced to zero ($0); and

 

28

 

Third, pro rata,
to the payment of any other amounts then due the holder of Note A-1, Note A-2,
Note A-3, Note A-4, Note A-5, and Note A-6.

 

2.2.5        Late Payment Charge.

 

If any principal, interest
or any other sum due under the Loan Documents is not paid by Borrower on the
date on which it is due (other than the final payment due on the Maturity
Date), Borrower shall pay to Lender upon demand an amount equal to the lesser
of four percent (4%) of such unpaid sum or the maximum amount permitted by
Applicable Law in order to defray the expense incurred by Lender in handling
and processing such delinquent payment and to compensate Lender for the loss of
the use of such delinquent payment.  Any
such amount shall be secured by the Security Instruments and the other Loan
Documents to the extent permitted by Applicable Law.

 

2.2.6        Usury Savings.

 

This Agreement and the Note
are subject to the express condition that at no time shall Borrower be obligated
or required to pay interest on the principal balance of the Loan at a rate
which could subject Lender to either civil or criminal liability as a result of
being in excess of the Maximum Legal Rate. 
If, by the terms of this Agreement or the other Loan Documents, Borrower
is at any time required or obligated to pay interest on the principal balance
due hereunder at a rate in excess of the Maximum Legal Rate, the Applicable
Interest Rate or the Default Rate, as the case may be, shall be deemed to be immediately
reduced to the Maximum Legal Rate and all previous payments in excess of the
Maximum Legal Rate shall be deemed to have been payments in reduction of
principal and not on account of the interest due hereunder.  All sums paid or agreed to be paid to Lender
for the use, forbearance, or detention of the sums due under the Loan, shall,
to the extent permitted by Applicable Law, be amortized, prorated, allocated,
and spread throughout the full stated term of the Loan until payment in full so
that the rate or amount of interest on account of the Loan does not exceed the
Maximum Legal Rate of interest from time to time in effect and applicable to
the Loan for so long as the Loan is outstanding.

 

2.2.7        Indemnified Taxes.

 

(a)           All payments made by Borrower hereunder shall be made free
and clear of, and without reduction for or on account of, Indemnified Taxes,
excluding (i) Indemnified Taxes measured by Lender’s net income, and franchise
taxes imposed on it, by the jurisdiction under the laws of which Lender is
resident or organized, or any political subdivision thereof, (ii) taxes
measured by Lender’s overall or branch net income, and franchise taxes imposed
on it, by the jurisdiction of Lender’s applicable lending office or any
political subdivision thereof or in which Lender is resident or engaged in
business, and (iii) withholding taxes imposed by the United States of America,
any state, commonwealth, protectorate territory or any political subdivision or
taxing authority thereof or therein as a result of the failure of Lender which
is a Non-U.S. Entity to comply with the terms of paragraph (b) below.  If any non excluded Indemnified Taxes are
required to be withheld from any amounts payable to Lender hereunder, the amounts
so payable to Lender shall be increased to the extent necessary to yield to

 

29

 

Lender (after payment of all non excluded Indemnified Taxes) interest
or any such other amounts payable hereunder at the rate or in the amounts
specified hereunder.  Whenever any non
excluded Indemnified Tax is payable pursuant to Applicable Law by Borrower,
Borrower shall send (or cause to be sent) to Lender an original official
receipt showing payment of such non excluded Indemnified Tax or other evidence
of payment reasonably satisfactory to Lender. 
Borrower hereby indemnifies Lender for any incremental taxes, interest
or penalties that become payable by Lender which result from any failure by
Borrower to pay any such non excluded Indemnified Tax when due to the
appropriate taxing authority or any failure by Borrower to remit to Lender the
required receipts or other required documentary evidence.

 

(b)            In the event that Lender or any successor and/or assign
of Lender is not incorporated under the laws of the United States of America or
a state thereof (a “Non-U.S. Entity”) Lender agrees that, prior to the first
date on which any payment is due such entity hereunder, it will deliver to
Borrower two duly completed copies of United States Internal Revenue Service Form
W 8BEN or W 8ECI or successor applicable form, as the case may be, certifying
in each case that such entity is entitled to receive payments under the Note,
without deduction or withholding of any United States federal income taxes.  Each entity required to deliver to Borrower a
Form W 8BEN or W 8ECI pursuant to the preceding sentence further undertakes to
deliver to Borrower two further copies of such forms, or successor applicable
forms, or other manner of certification, as the case may be, on or before the
date that any such form expires (which, in the case of the Form W 8ECI, is the
last day of each U.S. taxable year of the Non-U.S. Entity) or becomes obsolete
or after the occurrence of any event requiring a change in the most recent form
previously delivered by it to Borrower, and such other extensions or renewals
thereof as may reasonably be requested by Borrower, certifying in the case of a
Form W 8BEN or W 8ECI that such entity is entitled to receive payments under
the Note without deduction or withholding of any United States federal income
taxes, unless in any such case any change in treaty, law or regulation has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
entity from duly completing and delivering any such form with respect to it and
such entity advises Borrower that it is not capable of receiving payments
without any deduction or withholding of United States federal income tax.

 

Section
2.3            Prepayments.

 

2.3.1        Voluntary Prepayments.

 

Except as otherwise provided
herein, Borrower shall not have the right to prepay the Loan in whole or in
part prior to the Maturity Date.  On April 5, 2016 (the “Permitted Prepayment
Date”) or on any Payment Date thereafter, Borrower may, at its option and upon
thirty (30) days prior written notice to Lender, prepay the Loan in whole but
not in part, without payment of the Yield Maintenance Premium, provided,
Borrower pays to Lender all accrued and unpaid interest on the amount of
principal being prepaid through and including the date of prepayment.

 

30

 

2.3.2        Mandatory Prepayments.

 

On the next occurring
Payment Date following the date on which Borrower actually receives any Net
Proceeds, if and to the extent Lender is not obligated to make such Net
Proceeds available to Borrower for the Restoration of an Individual Property,
Borrower shall prepay the outstanding principal balance of the Note in an
amount equal to one hundred percent (100%) of such Net Proceeds.  No Yield Maintenance Premium shall be due in
connection with any prepayment made pursuant to this Section 2.3.2. Any amounts
paid to or received by Lender pursuant to this Section 2.3.2, provided that an
Event of Default shall not have occurred, shall be applied by Lender to the
Debt in the following order of priority:

 

First, pro rata,
to the payment of accrued and unpaid interest on the outstanding principal
balances of Note A-1, Note A-2, Note A-3, Note A-4, Note A-5, and Note A-6 at
the Applicable Interest Rate;

 

Second, pro rata,
to the payment of the outstanding principal balances of Note A-1, Note A-2,
Note A-3, Note A-4, Note A-5, and Note A-6 until the amounts evidenced by the
Notes are reduced to zero ($0); and

 

Third, pro rata,
to the payment of any other amounts then due the holder of Note A-1, Note A-2,
Note A-3, Note A-4, Note A-5, and Note A-6.

 

2.3.3        Prepayments After Default.

 

If, following an Event of
Default, Borrower tenders payment of all or any part of the Debt, or if all or
any portion of the Debt is recovered by Lender after such Event of Default such
tender or recovery shall be deemed a voluntary prepayment by Borrower in
violation of the prohibition against prepayment set forth in Section 2.3.1
hereof and Borrower shall pay, in addition to the Debt, (i) an amount equal to
the greater of (a) one percent (1%) of the outstanding principal amount of the
Loan to be prepaid or satisfied, or (b) the Yield Maintenance Premium that
would be required if a Defeasance Event had occurred in an amount equal to the
outstanding principal amount of the Loan to be satisfied or prepaid and (ii)
all accrued and unpaid interest on the amount of principal being prepaid
through and including the date of prepayment. Notwithstanding anything to the
contrary contained herein, any amounts paid to or received by Lender in
connection with the Loan during the continuation of an Event of Default shall
be applied by Lender to the Debt in the following order of priority:

 

First, pro rata,
to the payment of interest on the outstanding principal balances of Note A-1,
Note A-2, Note A-3, Note A-4, Note A-5, and Note A-6 at the Applicable Interest
Rate;

 

Second, pro rata,
to the payment of the outstanding principal balances of Note A-1, Note A-2,
Note A-3, Note A-4, Note A-5, and Note A-6 until Note A-1, Note A-2, Note A-3,
Note A-4, Note A-5, and Note A-6 are reduced to zero ($0); and

 

Third, pro rata,
to the payment of any other amounts then due the holder of Note A-1, Note A-2,
Note A-3, Note A-4, Note A-5, and Note A-6.

 

31

 

2.3.4        Making of Payments.

 

Each payment by Borrower
hereunder or under the Note shall be made in funds settled through the New York
Clearing House Interbank Payments System or other funds immediately available
to Lender by 1:00 p.m., New York City time, on or prior to the date such
payment is due, to Lender by deposit to such account as Lender may designate by
written notice to Borrower.  Whenever any
payment hereunder or under the Note shall be stated to be due on a day which is
not a Business Day, such payment shall be made on the first Business Day
succeeding such scheduled due date.

 

2.3.5        Application of Prepayments.

 

All prepayments received
pursuant to this Section 2.3 and Section 2.5 hereof shall be applied to the
payments of principal due under the Loan in the inverse order of maturity.

 

Section
2.4            Defeasance.

 

2.4.1        Voluntary Defeasance.

 

(a)           Provided no Event of
Default shall then exist, Borrower shall have the right at any time after the
Permitted Defeasance Date to voluntarily defease all, but other than in
connection with a release of an Individual Property in accordance with the
terms hereof, not a portion, of the Loan by and upon satisfaction of the
following conditions (such event being a “Defeasance Event”):

 

(i)            Borrower shall provide not less than
thirty (30) days prior written notice to Lender specifying the Payment Date
(the “Defeasance Date”) on which the Defeasance Event will occur and the principal
amount of the Loan to be defeased;

 

(ii)           Borrower shall pay to Lender all
accrued and unpaid interest on the principal balance of the Note to and
including the Defeasance Date;

 

(iii)          Borrower shall pay to Lender all other
sums, not including scheduled interest or principal payments, then due under
the Note, this Agreement, the Security Instruments, and the other Loan
Documents;

 

(iv)          Borrower shall deliver to Lender the
Defeasance Deposit applicable to the Defeasance Event;

 

(v)           In the event only a portion of the
Loan is the subject of the Defeasance Event, Borrower shall prepare all
necessary documents to modify this Agreement and to amend and restate the Note
and issue two substitute notes for the Note, one note having a principal
balance equal to the defeased portion of the original Note and a maturity date
equal to the Permitted Prepayment Date (the “Defeased Note”) and the other note
having a principal balance equal to the undefeased portion of the original Note
and a maturity date equal to the Maturity Date (the “Undefeased Note”).  The Defeased Note and the Undefeased Note
shall have identical terms as the original Note except for the principal
balance. A Defeased Note cannot be the subject of any further Defeasance Event.
The Undefeased Note may be the subject of a further Defeasance Event in
accordance with the terms and provisions of this Section 2.4 (the term “Note”,
as used in this clause (v)

 

32

 

for such purpose, being
deemed to refer to the Undefeased Note that is the subject of further
defeasance), provided, however, that no such partial defeasance shall take
place unless the conditions outlined in Section 2.5 are satisfied;

 

(vi)          Borrower shall execute and deliver a
security agreement, in a form and substance that would be reasonably
satisfactory to a prudent institutional lender, creating a first priority lien
on the Defeasance Deposit and the Defeasance Collateral purchased with the
Defeasance Deposit in accordance with the provisions of this Section 2.4 (the “Security
Agreement”);

 

(vii)         Borrower shall deliver an opinion of
counsel for Borrower in a form and substance that would be reasonably
satisfactory to a prudent institutional lender stating, among other things,
that Borrower has legally and validly transferred and assigned the Defeasance
Collateral and all obligations, rights and duties under and to the Note or the
Defeased Note (as applicable) to the Successor Borrower, that Lender has a
perfected first priority security interest in the Defeasance Deposit and the
Defeasance Collateral delivered by Borrower and that any REMIC Trust formed
pursuant to a Securitization will not fail to maintain its status as a “real
estate mortgage investment conduit” within the meaning of Section 860D of the
Code as a result of such Defeasance Event;

 

(viii)        Borrower shall deliver confirmation in
writing from the applicable Rating Agencies to the effect that such defeasance
and release will not result in a downgrading, withdrawal or qualification of the
respective ratings in effect immediately prior to such Defeasance Event for the
Securities issued in connection with the Securitization which are then
outstanding.  If required by the
applicable Rating Agencies, Borrower shall also deliver, or cause to be
delivered, a non-consolidation opinion with respect to the Successor Borrower
in form and substance satisfactory to Lender and the applicable Rating
Agencies;

 

(ix)           Borrower shall deliver an Officer’s
Certificate certifying that the requirements set forth in this Section 2.4.1(a)
have been satisfied;

 

(x)            Borrower shall deliver a certificate
of an Approved Accountant certifying that the Defeasance Collateral purchased
with the Defeasance Deposit generate monthly amounts equal to or greater than
the Scheduled Defeasance Payments;

 

(xi)           Borrower shall deliver such other
certificates, documents or instruments as Lender may reasonably request; and

 

(xii)          Borrower shall pay all actual and
reasonable costs and expenses of Lender incurred in connection with the Defeasance
Event, including, without limitation, (A) any costs and expenses associated
with a release of the Lien of the Security Instrument as provided in Section
2.5 hereof, (B) Lender’s reasonable attorneys’ fees and expenses, (C) the costs
and expenses of the Rating Agencies, (D) any revenue, documentary stamp or
intangible taxes or any other tax or charge due in connection with the transfer
of the Note, or otherwise required to accomplish the defeasance and (E) the
actual and

 

33

 

reasonable costs and
expenses actually incurred by Servicer and any trustee, including reasonable
attorneys’ fees.

 

(b)           In connection with a
Defeasance Event, Borrower hereby appoints Lender as its agent and
attorney-in-fact for the purpose of using the Defeasance Deposit to purchase
U.S. Obligations or, to the extent approved by the Rating Agencies in writing,
other “government securities” within the meaning of Section 2(a)(16) of the
Investment Company Act of 1940 (the “Defeasance Collateral”) which provide
payments on or prior to, but as close as possible to, all successive scheduled
payment dates after the Defeasance Date upon which interest and principal
payments are required under the Note in the case of a Defeasance Event for the
entire outstanding principal balance of the Loan, or the Defeased Note, in the
case of a Defeasance Event for only a portion of the outstanding principal
balance of the Loan, as applicable, and in amounts equal to the scheduled
payments due on such dates under this Agreement and the Note or the Defeased
Note (as applicable) (including without limitation scheduled payments of
principal, interest, servicing fees (if any), and any other amounts due under
the Loan Documents on such dates) and assuming such Note or the Defeased Note
(as applicable) is paid in full on the Permitted Prepayment Date or any date
thereafter prior to the Maturity Date (the “Scheduled Defeasance Payments”).  Each of the U.S. Obligations or other
securities that are part of the Defeasance Collateral shall be duly endorsed by
the holder thereof as directed by Lender or accompanied by a written instrument
of transfer in form and substance that would be satisfactory to a prudent
institutional lender (including, without limitation, such instruments as may be
required by the depository institution holding such securities or by the issuer
thereof, as the case may be, to effectuate book entry transfers and pledges
through the book entry facilities of such institution) in order to perfect upon
the delivery of the Defeasance Collateral a first priority security interest
therein in favor of Lender in conformity with all applicable state and federal
laws governing the granting of such security interests.  Borrower, pursuant to the Security Agreement
or other appropriate document, shall authorize and direct that the payments
received from the Defeasance Collateral may be made directly to the Lockbox
Account (unless otherwise directed by Lender) and applied to satisfy the
obligations of Borrower under the Note or the Defeased Note (as
applicable).  Any portion of the
Defeasance Deposit in excess of the amount necessary to purchase the Defeasance
Collateral required by this Section 2.4 and satisfy Borrower’s other
obligations under this Section 2.4 and Section 2.5 hereof shall be remitted to
Borrower.

 

2.4.2        Successor Borrower.

 

In connection with any
Defeasance Event, Borrower shall establish or designate a successor entity (the
“Successor Borrower”) which shall be a single purpose bankruptcy remote entity
with two (2) Independent Directors approved by Lender, and Borrower shall
transfer and assign all obligations, rights and duties under and to the Note or
the Defeased Note (as applicable) together with the pledged Defeasance
Collateral to such Successor Borrower. 
Such Successor Borrower shall assume the obligations under the Note or
the Defeased Note (as applicable) and the Security Agreement and Borrower shall
be relieved of its obligations under such documents and the other Loan
Documents, except with respect to those obligations which are expressly stated
to survive.  Notwithstanding anything in
this Agreement to the contrary, no other assumption fee shall be payable upon a
transfer of the Note or the Defeased Note (as applicable) in accordance with
this Section 2.4.2, but Borrower shall pay all actual and

 

34

 

reasonable costs and expenses incurred by Lender,
including Lender’s attorneys’ fees and expenses, incurred in connection
therewith

 

Section
2.5            Release of Property.

 

Except as set forth in
Section 2.4 hereof and this Section 2.5, no repayment, prepayment or defeasance
of all or any portion of the Loan shall cause, give rise to a right to require,
or otherwise result in, the release of any Lien of any Security Instrument on
any Individual Property.

 

2.5.1        Release of the Properties.

 

(a)           After the Permitted
Defeasance Date, if Borrower has elected to defease the entire Loan and all the
applicable requirements of Section 2.4 hereof and this Section 2.5 have been
satisfied, all of the Properties shall be released from the Lien of their
respective Security Instruments, and the U.S. Obligations, pledged pursuant to
the Security Agreement, shall be the sole source of collateral securing the
Note.

 

(b)           In connection with
the release of the Security Instruments, Borrower shall submit to Lender, not
less than thirty (30) days prior to the Defeasance Date, a release of Lien (and
related Loan Documents) for each Individual Property for execution by Lender.  Such release shall be in a form appropriate
in each jurisdiction in which an Individual Property is located and that would
be satisfactory to a prudent institutional lender and shall contain standard
provisions, if any, protecting the rights of the releasing lender.  In addition, Borrower shall provide all other
documentation Lender reasonably requires to be delivered by Borrower in
connection with such release, together with an Officer’s Certificate certifying
that such documentation (i) is in compliance with all applicable Legal
Requirements, and (ii) will, following execution by Lender and recordation
thereof, effect such releases in accordance with the terms of this Agreement.

 

2.5.2        Release of Individual Property.

 

After the Permitted
Defeasance Date, if Borrower has elected to defease a portion of the Loan and
the applicable requirements of Section 2.4 hereof and this Section 2.5 have
been satisfied, and provided that no Event of Default shall then exist,
Borrower may obtain the release of an Individual Property from the Lien of the
Security Instrument thereon (and related Loan Documents) and the release of
Borrower’s obligations under the Loan Documents with respect to such Individual
Property (other than those expressly stated to survive), upon the satisfaction
of each of the following conditions

 

(a)           The amount of the outstanding principal balance of the
Loan to be defeased in accordance with Section 2.4 hereof shall equal or exceed
the Release Price for the applicable Individual Property, and such defeasance
shall be deemed a voluntary defeasance for all purposes hereunder;

 

(b)           Borrower shall provide Lender with at least thirty (30)
days but no more than ninety (90) days prior written notice of its request to
obtain a release of the Individual Property;

 

35

 

(c)           Borrower shall defease the portion of the Note equal to
the Release Price of the Individual Property being released (together with all
accrued and unpaid interest on the principal amount being defeased) in
accordance with the terms and conditions of Sections 2.4.1 and 2.4.2 hereof;

 

(d)           Borrower shall submit (or cause the Operating Tenant to
submit) to Lender, not less than ten (10) Business Days prior to the date of
such release, a release of Lien (and related Loan Documents) for such
Individual Property for execution by Lender. 
Such release shall be in a form appropriate in the State in which the
Individual Property is located and shall contain standard provisions, if any,
protecting the rights of the releasing lender. 
In addition, Borrower shall provide all other documentation Lender
reasonably requires to be delivered by Borrower in connection with such
release, together with an Officer’s Certificate certifying that (i) such
documentation is in compliance with all applicable Legal Requirements, and (ii)
the release will not impair or otherwise adversely affect the Liens, security
interests and other rights of Lender under the Loan Documents not being
released (or as to the parties to the Loan Documents and Properties subject to
the Loan Documents not being released);

 

(e)           Lender shall have received evidence that the Individual
Property to be released shall be conveyed to (i) a third party not Affiliated
with any Borrower, Guarantor or Indemnitor and in which Borrower and no
Affiliate of Borrower, Guarantor and/or any Indemnitor has any Controlling
beneficial interest or (ii) an Affiliate of Borrower provided the terms of such
conveyance (including, without limitation, the consideration paid therefor) are
substantially similar to those which would have been available to Borrower had
the conveyance been negotiated on an arms’ length basis with a third party not
Affiliated with Borrower, Principal, Guarantor or Indemnitor;

 

(f)            Unless the Operating Lease provides for such deletion to
occur automatically, Lender shall have received a certified copy of an
amendment to the Operating Lease reflecting the deletion of the Individual
Property to be released, which amendment shall reduce the rental obligations of
the applicable Operating Tenant thereunder by the Determined Minimum Rent, but
no other economic provisions of the Leases shall be modified or amended;

 

(g)           Lender shall have received payment of all Lender’s costs
and expenses, including due diligence review costs and reasonable counsel fees
and disbursements incurred in connection with the release of the Individual
Property from the lien of the related Security Instrument and the review and
approval of the documents and information required to be delivered in
connection therewith.

 

36

 

2.5.3        Release on Payment in Full.

 

Lender shall, upon the
written request and at the expense of Borrower, upon payment in full of all
principal and interest due on the Loan and all other amounts due and payable
under the Loan Documents in accordance with the terms and provisions of the
Note and this Agreement, release the Lien of the Security Instrument on each
Individual Property not theretofore released.

 

2.5.4        Out-Parcel Releases.

 

Upon the request of
Borrower, Lender shall release one or more Out-Parcels from the Lien of the
applicable Security Instrument and execute instruments of release or partial
release in duly recordable form (an “Out-Parcel Release”) provided that Borrower
shall, at its sole cost and expense, comply with all of the following terms,
conditions and provisions with respect to each such Out-Parcel and requested
Out-Parcel Release:

 

(a)           at the time of any such Out-Parcel Release, no Event of
Default shall have occurred and be continuing;

 

(b)           Borrower shall have delivered to Lender an Officer’s
Certificate (which Officer’s Certificate may be based on a certificate of the
Operating Tenant as to all facts stated therein) (the “Required Out-Parcel
Officer’s Certificate”) indicating that the conveyance of the Out-Parcel will
not materially and adversely affect the use or operation of or access to or
from the balance of the applicable Individual Property (the “Remaining
Property”) and Lender shall have determined that the conveyance of the
Out-Parcel will not (i) cause any portion of the Remaining Property to be in
violation of any Legal Requirements, (ii) create any Liens on the Remaining
Property or (iii) violate the terms of any document or instrument relating to
the applicable Individual Property; provided, however, to the extent that
Lender’s prior written approval is required pursuant to this Section 2.5.4(b),
Lender shall have fifteen (15) Business Days from the later of (i) the date of
receipt of such notice or (ii) if Lender has first requested additional
information and/or documentation in connection therewith during such fifteen
(15) Business Day period, receipt of all such information and documentation, in
which to make such determination, provided, such request to Lender is marked in
bold lettering with the following language: “LENDER’S RESPONSE IS REQUIRED
WITHIN FIFTEEN (15) BUSINESS DAYS OF RECEIPT OF THIS NOTICE PURSUANT TO THE
TERMS OF A LOAN AGREEMENT BETWEEN THE UNDERSIGNED AND LENDER” and the envelope
containing the request must be marked “PRIORITY”. In the event Lender fails to
respond within such time, Lender’s approval shall be deemed given;

 

(c)           Borrower has obtained, (i)(x) subdivision, zoning and all
other governmental approvals necessary or required to subdivide the Out-Parcel
from the Remaining Property or (y) a legal opinion by counsel reasonably
satisfactory to Lender (or such other evidence as would be reasonably
acceptable to a prudent institutional mortgage loan lender), that the Out-Parcel
and the Remaining Property are each entitled to be used and occupied as of
right without reference to or reliance on the other parcel (except with respect
to easements which have been reasonably approved by Lender in connection with
an Out-Parcel Release applying the standards of a reasonably prudent

 

37

 

institutional mortgage loan lender) and (ii) either (I) a legal opinion
by counsel reasonably satisfactory to Lender or a letter from the applicable municipal
authority, in either case, stating that, or (II) an endorsement to the title
insurance policy insuring the Lien of the applicable Security Instrument
insuring that, the Out-Parcel has been designated, assessed and taxed as a
separate tax lot independent from the Remaining Property or such other evidence
as would be reasonably acceptable to a prudent institutional mortgage loan
lender or (III) if (I) or (II) above are not satisfied, Lender shall continue
to escrow for Taxes for the Out-Parcel and the Remaining Property;

 

(d)           Borrower shall prepare and provide to Lender: subdivision
map(s) of all those portions of the Individual Property which are approved by
all Governmental Authorities having jurisdiction over the Out-Parcel and/or the
Remaining Property, whose approval as to such plans and maps is required; and
copies of each and all proposed easements and cross-easements and mutual or
non-exclusive easements for ingress, egress, access, pedestrian walkways,
parking, traffic flow, utilities and services and utilities shared by the
Remaining Property and the Out-Parcel and the like which may be required by any
Governmental Authority having jurisdiction or which are necessary and a survey
of the Out Parcel(s) to be released and of the Remaining Property, in a form,
scope and substance that would be acceptable to a reasonably prudent mortgage
lender, including an accurate legal description of the Out Parcel(s) to be
released.  Such subdivision map(s) (or
other evidence that would be reasonably acceptable to a prudent institutional
mortgage loan lender) shall show such parking structures and parking layouts as
will afford, to the Improvements located on the Remaining Property the
aggregate number of parking spaces required by the then applicable zoning requirements
for the Remaining Property;

 

(e)           the Operating Leases shall remain in full force and effect
and unaffected in any manner as a result of the Out-Parcel Release other than
with respect to the release of such Out-Parcel from the Operating Lease;

 

(f)            Borrower shall deliver to Lender evidence reasonably
acceptable to Lender that, other than the applicable Security Instrument, there
are no liens, mortgages, deeds of trust or other security instruments, as the
case may be, encumbering the Individual Property remaining encumbered by the
lien of the applicable Security Instrument;

 

(g)           Lender shall have received evidence that the Out-Parcel to
be released shall be conveyed to (i) a third party not Affiliated with
Borrower, Guarantor or Indemnitor and in which Borrower and no Affiliate of
Borrower, Guarantor and/or any Indemnitor has any Controlling beneficial
interest or (ii) an Affiliate of Borrower provided the terms of such conveyance
(including, without limitation, the consideration paid therefor) are substantially
similar to those which would have been available to Borrower had the conveyance
been negotiated on an arms’ length basis with a third party not Affiliated with
Borrower, Principal, Guarantor or Indemnitor;

 

(h)           Borrower shall pay all of Lender’s reasonable actual
out-of-pocket costs and expenses (including reasonable counsel fees and
disbursements) incurred in

 

38

 

connection with Lender’s review of the foregoing items, the
determination of the satisfaction of such conditions and otherwise incurred in
connection with the Out-Parcel Release; and

 

(i)            Only in the event that the Loan is then subject to a
Securitization, Borrower shall deliver to Lender a legal opinion reasonably
satisfactory to Lender from a law firm reasonably acceptable to Lender, stating
among other things, that the Out-Parcel Release does not constitute a “significant
modification” of the Loan under Section 1001 of the Code.

 

Lender shall promptly
release such Out-Parcel from the Lien of the applicable Security Instrument
after all of the requirements of this Section 2.5.4 have been satisfied.  All instruments of release shall be in duly
recordable form and contain such covenants, conditions and restrictions and
shall reserve such rights and easements with respect to the Out-Parcel as are
necessary to protect and preserve Lender’s interests in the Remaining Property
after any such release.

 

2.5.5        Release of the Madison Property Prior to the Permitted
Defeasance Date.

 

Borrower shall have the
right to a release of the Madison Property at any time that the Madison
Property is subject to acquisition by a third party option holder pursuant to
the exercise of the option agreement that is a Permitted Encumbrance on the
Madison Property as of the date hereof by payment to Lender of the Release
Price for the Madison Property and, if, such option is exercised prior to the
Permitted Defeasance Date, such tender or recovery shall be deemed a voluntary
prepayment by Borrower, and Borrower shall pay, in addition to the Release
Price for the Madison Property, (i) an amount equal to the greater of (a) one
percent (1%) of the outstanding principal amount of the Loan to be prepaid or
satisfied, or (b) the Yield Maintenance Premium that would be required if a
Defeasance Event had occurred in an amount equal to the outstanding principal
amount of the Loan to be satisfied or prepaid and (ii) all accrued and unpaid
interest on the amount of principal being prepaid through and including the
date of prepayment (such amount payable to the Lender hereunder, the “Madison
Property Release Price”).  All sums paid
by the party exercising such option shall be paid to Lender on the closing date
of such sale of the Madison Property in connection with the exercise of such
option (the “Madison Property Option Purchase Price”) and Borrower shall,
concurrently therewith, pay to Lender any shortfall amount equal to the
difference between (i) the amount so paid by the option purchaser at the
closing and the Madison Property Release Price (such shortfall, the “Madison
Property Option Shortfall Amount”).  If
the amount that is paid by the option purchaser in connection with the
acquisition of the Madison Property is greater than the Madison Property
Release Price, then any such excess purchase price amounts paid by the option
purchaser shall be payable to Borrower.

 

Section
2.6            Substitution of Properties.

 

Subject
to the terms of this Section 2.6, Borrower may obtain, from time to time, a
release from the Lien of the related Security Instrument (and the related Loan
Documents) (each, a “Replaced Property”) by substituting therefor another
retail property of like kind and quality acquired by Borrower or an Affiliate
of Borrower (provided, however, if the Substitute Property

 

39

 

shall
be owned by an Affiliate of Borrower said Affiliate (i) shall assume all the
obligations of Borrower under this Agreement, the Note and the other Loan
Documents and (ii) shall become a party to the Note and the other Loan
Documents and shall be bound by the terms and provisions thereof as if it had
executed the Note and the other Loan Documents and shall have the rights and
obligations of Borrower thereunder) (individually, a “Substitute Property” and
collectively, the “Substitute Properties”), provided that the following
conditions precedent are satisfied:

 

(c)           Other than with
respect to any Out-Parcel Release permitted hereunder, Borrower’s right to
release and substitute Properties in accordance with this Section shall
automatically terminate at such time as the Square Footage Limitations are met
or exceeded.

 

(d)           Lender shall have
received at least thirty (30) days prior written notice requesting the
substitution and identifying the Substitute Property and Replaced Property.

 

(e)           If the applicable
Borrower continues to own an Individual Property subject to the Lien of a
Security Instrument, Lender shall have received (i) a copy of a deed conveying
all of Borrower’s right, title and interest in and to the Replaced Property to
a Person other than Borrower or Principal pursuant to an arms length
transaction and (ii) a letter from Borrower countersigned by a title insurance
company acknowledging receipt of such deed and agreeing to record such deed in
the real estate records for the county in which the Replaced Property is
located.

 

(f)            Lender shall have
received a current Appraisal of the Replaced Property and the Substitute
Property prepared within one hundred eighty (180) days prior to the release and
substitution showing an appraised value equal to or greater than the appraised
value of the Replaced Property (A) as of the Closing Date and (B) immediately
prior to the date of the proposed substitution.

 

(g)           Lender shall have
received a certificate of Borrower certifying, together with other evidence
that would be satisfactory to a prudent institutional mortgage loan lender
that, after the substitution of a Substitute Property and the release of the
Replaced Property, the debt service coverage ratio for the twelve (12) full
calendar months immediately preceding the date of the substitution with respect
to all Properties remaining subject to the lien of the Security Instruments
after the substitution shall be equal to or greater than (A) debt service
coverage ratio for the twelve (12) full calendar months immediately preceding
the Closing Date and (B) debt service coverage ratio for the twelve (12) full
calendar months immediately preceding the substitution (including the Replaced
Property and excluding the Substitute Property).

 

(h)           After Individual
Properties with an aggregate square footage of at least ten percent (10%) of
the original square footage demised under the Operating Leases have been
released pursuant to the terms of this Section 2.6, (A) if the Loan is part of
a Securitization, Lender shall have received confirmation in writing from the
Rating Agencies to the effect that such release and substitution will not
result in a withdrawal, qualification or downgrade of the respective ratings in
effect immediately prior to such release and substitution for the Securities
issued in connection with the Securitization that are then outstanding or (B)
if the Loan is not part of a Securitization, Lender shall have consented in
writing to such release and substitution, which consent shall be given in
Lender’s reasonable discretion applying the requirements of a

 

40

 

prudent
institutional mortgage loan lender with respect to real estate collateral of
similar size, scope and value of the Substitute Property.

 

(i)            Lender has received
evidence that the store-level profitability as set-forth in the P&L Report
of the Substitute Property is equal to or greater than the store-level
profitability of the Replaced Property as set-forth in the P&L Report for
the immediately preceding twelve (12) month period.

 

(j)            No Event of Default
shall have occurred and be continuing and Borrower shall be in compliance in
all material respects with all terms and conditions set forth in this Agreement
and in each other Loan Document on Borrower’s part to be observed or performed.
Lender shall have received a certificate from Borrower confirming the
foregoing, stating that the representations and warranties of Borrower
contained in this Agreement and the other Loan Documents are true and correct
in all material respects on and as of the date of the release and substitution
with respect to Borrower, the Properties and the Substitute Property and
containing any other representations and warranties with respect to Borrower,
the Properties, the Substitute Property or the Loan as (i) Lender, if a
Securitization has not occurred, or (ii) the Rating Agencies, if a
Securitization has occurred, may require, unless such certificate would be
inaccurate, such certificate to be in form and substance satisfactory to Lender
or the Rating Agencies, as applicable.

 

(k)           Borrower shall (A)
have executed, acknowledged and delivered to Lender (I) a Security Instrument,
an Assignment of Leases and Rents and two UCC-1 Financing Statements with
respect to the Substitute Property, together with a letter from Borrower
countersigned by a title insurance company acknowledging receipt of such
Security Instrument, Assignment of Leases and Rents and UCC-1 Financing
Statements and agreeing to record or file, as applicable, such Security
Instrument, Assignment of Leases and Rents and one of the UCC-1 Financing
Statements in the real estate records for the county in which the Substitute
Property is located and to file one of the UCC-1 Financing Statements in the
office of the Secretary of State (or other central filing office) of the State
in which the Substitute Property is located, so as to effectively create upon
such recording and filing valid and enforceable first priority Liens upon the
Substitute Property, in favor of Lender (or such other trustee as may be
desired under local law), subject only to the Permitted Encumbrances and such
other Liens as are permitted pursuant to the Loan Documents and (II) an
Environmental Indemnity with respect to the Substitute Property from Indemnitor
and (B) have caused Guarantor to acknowledge and confirm its obligations with
respect to the Non-Recourse Carve-Out Obligations under the Loan
Documents.  The Security Instrument,
Assignment of Leases and Rents, UCC-1 Financing Statements and Environmental
Indemnity shall be the same in form and substance as the counterparts of such
documents executed and delivered with respect to the related Replaced Property
subject to modifications reflecting only the Substitute Property as the
Individual Property and such modifications reflecting the laws of the State in
which the Substitute Property is located. 
The Security Instrument encumbering the Substitute Property shall secure
all amounts then outstanding under the Note, provided that in the event that
the jurisdiction in which the Substitute Property is located imposes a mortgage
recording, intangibles or similar tax and does not permit the allocation of
indebtedness for the purpose of determining the amount of such tax payable, the
principal amount secured by such Security Instrument shall be equal to one
hundred twenty-five percent (125%) of the Allocated Loan Amount for the
Substitute Property.

 

41

 

(l)            Lender
shall have received (A) to the extent available, any “tie-in” or similar
endorsement, together with a “first loss” endorsement, to each Title Insurance
Policy insuring the Lien of the existing Security Instruments as of the date of
the substitution with respect to the Title Insurance Policy insuring the Lien
of the Security Instrument with respect to the Substitute Property and (B) a
Title Insurance Policy (or a marked, signed and redated commitment to issue
such Title Insurance Policy related to the Substitute Property) insuring the
Lien of the Security Instrument encumbering the Substitute Property, issued by
the title company that issued the Title Insurance Policies insuring the Lien of
the existing Security Instruments and dated as of the date of the substitution
with respect to such Substitute Property, with reinsurance and direct access
agreements that replace such agreements issued in connection with the Title
Insurance Policy insuring the Lien of the Security Instrument encumbering the Replaced
Property. The Title Insurance Policy issued with respect to the Substitute
Property shall (1) provide coverage in the amount of the Substitute Allocated
Loan Amount if the “tie-in” or similar endorsement described above is available
or, if such endorsement is not available, in an amount equal to one hundred
twenty-five percent (125%) of the Substitute Allocated Loan Amount, together
with “last dollar endorsement,” (2) insure Lender that the relevant Security
Instrument creates a valid first lien on the Substitute Property encumbered
thereby, free and clear of all exceptions from coverage other than Permitted
Encumbrances and standard exceptions and exclusions from coverage (as modified
by the terms of any endorsements), (3) contain such endorsements and
affirmative coverages as are then available and are contained in the Title
Insurance Policies insuring the Liens of the existing Security Instruments, and
such other endorsements or affirmative coverage that a prudent institutional
mortgage lender would require, and (4) name Lender as the insured. Lender also
shall have received copies of paid receipts or other evidence showing that all
premiums in respect of such endorsements and Title Insurance Policies have been
paid.

 

(m)          Lender
shall have received a current Survey for each Substitute Property, certified to
the title company and Lender and its successors and assigns, in the same form
and having substantially the same content (other otherwise sufficient to cause
the title company to insure over any survey exception) as the certification of
the Survey of the Replaced Property prepared by a professional land surveyor
licensed in the State in which the Substitute Property is located and
acceptable to the Rating Agencies in accordance with the 1999 Minimum Standard
Detail Requirements for ALTA/ACSM Land Title Surveys. Such Survey shall reflect
the same legal description contained in the Title Insurance Policy relating to
such Substitute Property and shall include, among other things, a metes and
bounds description of the real property comprising part of such Substitute
Property (unless such real property has been satisfactorily designated by lot
number on a recorded plat). The surveyor’s seal shall be affixed to each Survey
and each Survey shall certify whether or not the surveyed property is located
in a “one-hundred-year flood hazard area.”

 

(n)           Lender
shall have received valid certificates of insurance indicating that the
requirements for the policies of insurance required for an Individual Property
hereunder have been satisfied with respect to the Substitute Property and
evidence of the payment of all Insurance Premiums payable for the existing
policy period.

 

(o)           Lender
shall have received a Phase I environmental report dated not more than one
hundred eighty (180) days prior to the proposed date of substitution and
otherwise acceptable to a prudent institutional mortgage loan lender and, if
recommended under the Phase I

 

42

 

environmental
report, a Phase II environmental report that would be acceptable to a prudent
institutional mortgage loan lender, which conclude that the Substitute Property
does not contain any Hazardous Materials and is not subject to any significant
risk of contamination from any off site Hazardous Materials.

 

(p)           Borrower
shall deliver, or cause to be delivered, to Lender (A) updates or, if the
Substitute Property is to be owned by an Affiliate of Borrower, originals, in
either case certified by Borrower or such Affiliate, as applicable, of all
organizational documentation related to Borrower or such Affiliate, as
applicable, and/or the formation, structure, existence, good standing and/or
qualification to do business delivered to Lender on the Closing Date; (B) good
standing certificates, certificates of qualification to do business in the
jurisdiction in which the Substitute Property is located (if required in such
jurisdiction); and (C) resolutions of Borrower or such Affiliate, as
applicable, authorizing the substitution and any actions taken in connection
with such substitution.

 

(q)           Lender
shall have received the following opinions of Borrower’s counsel: (A) an
opinion or opinions of counsel admitted to practice under the laws of the State
in which the Substitute Property is located stating that the Loan Documents
delivered with respect to the Substitute Property pursuant to clause (i) above
are valid and enforceable in accordance with their terms, subject to the laws
applicable to creditors’ rights and equitable principles, and that Borrower is
qualified to do business and in good standing under the laws of the
jurisdiction where the Substitute Property is located or that Borrower is not
required by Applicable Law to qualify to do business in such jurisdiction; (B)
an opinion of counsel acceptable to the Rating Agencies if the Loan is part of
a Securitization, or Lender if the Loan is not part of a Securitization,
stating that the Loan Documents delivered with respect to the Substitute
Property pursuant to this Section, among other things, have been duly
authorized, executed and delivered by Borrower and that the execution and
delivery of such Loan Documents and the performance by Borrower of its
obligations thereunder will not cause a breach of, or a default under, any
agreement, document or instrument to which Borrower is a party or to which it
or its properties are bound; (C) if the Loan is part of a Securitization, an
update of the Insolvency Opinion indicating that the substitution does not
affect the opinions set forth therein; (D) if the Loan is part of a
Securitization, an opinion of counsel acceptable to the Rating Agencies that
the substitution does not constitute a “significant modification” of the Loan
under Section 1001 of the Code or otherwise cause a tax to be imposed on a “prohibited
transaction” by any REMIC Trust.

 

(r)            Borrower
shall (i) have paid, (ii) have escrowed with Lender or (iii) be contesting in
accordance with the terns hereof, all Basic Carrying Costs relating to each of
the Properties and the Substitute Property, including without limitation, (i)
accrued but unpaid Insurance Premiums relating to each of the Properties and
the Substitute Property, and (ii) currently due and payable Taxes (including
any in arrears) relating to each of the Properties and the Substitute Property
and (iii) currently due and payable Other Charges relating to each of the
Properties and Substitute Property.

 

(s)           Borrower
shall have paid to Lender a substitution fee equal to $2,500 and paid or
reimbursed Lender for all costs and expenses incurred by Lender (including,
without limitation, reasonable attorneys’ fees and disbursements) in connection
with the release and substitution and

 

43

 

Borrower shall
have paid all recording charges, filing fees, taxes or other expenses
(including, without limitation, mortgage and intangibles taxes and documentary
stamp taxes) payable in connection with the substitution. Borrower shall have
paid all costs and expenses of the Rating Agencies incurred in connection with
the substitution.

 

(t)            Lender
shall have received annual P&L Reports and Mini Report for the Substitute
Property for the most current completed fiscal year and a current P&L
Report and Mini Report for the Replaced Property, each certified by Borrower to
Lender as being a true and correct copy of the report received from the
Operating Tenant and a certificate from Borrower certifying that, to Borrower’s
knowledge, there has been no material adverse change in the financial condition
of the Substitute Property since the date of such P&L Report.

 

(u)           Borrower
shall have delivered to Lender an estoppel certificate from Operating Tenant
with respect to the Operating Lease. 
Such estoppel certificate shall be substantially in the form approved by
Lender in connection with the origination of the Loan and shall indicate that
(1) the Operating Lease is a valid and binding obligation of Operating Tenant,
(2) there are no material defaults under the Operating Lease on the part of the
landlord or Tenant thereunder, (3) Operating Tenant has no knowledge of any
defense or offset to the payment of rent under the Operating Lease, (4) no rent
under the Operating Lease has been paid more than one (1) month in advance and
(5) Operating Tenant has no option under the Operating Lease to purchase all or
any portion of the Substitute Property.

 

(v)           Lender
shall have received subordination agreements in substantially the form approved
by Lender in connection with the origination of the Loan (or such other form
approved by Lender, which approval shall not be unreasonably withheld) with
respect to the Operating Lease.

 

(w)          Lender
shall have received (A) an endorsement to the Title Insurance Policy insuring
the Lien of the Security Instrument encumbering the Substitute Property
insuring that the Substitute Property constitutes a separate tax lot or, if
such an endorsement is not available in the State in which the Substitute
Property is located, a letter from the title insurance company issuing such
Title Insurance Policy stating that the Substitute Property constitutes a
separate tax lot or (B) a letter from the appropriate taxing authority stating
that the Substitute Property constitutes a separate tax lot.

 

(x)            Lender
shall have received a Physical Conditions Report with respect to the Substitute
Property stating that the Substitute Property and its use comply in all
material respects with all applicable Legal Requirements (including, without
limitation, zoning, subdivision and building laws) and that the Substitute
Property is in good condition and repair and free of damage or waste.

 

(y)           Lender
shall have received evidence which would be satisfactory to a prudent
institutional mortgage loan lender to the effect that all material building and
operating licenses and permits necessary for the use and occupancy of the
Substitute Property as a retail shopping establishment including, but not
limited to, current certificates of occupancy, have been obtained and are in
full force and effect.

 

44

 

(z)            Intentionally
Omitted.

 

(aa)         Lender
shall have received a certified copy of an amendment to the Operating Lease
reflecting the deletion of the Replaced Property and the addition of the
Substitute Property as a property encumbered pursuant thereto, which amendment
shall not change the rental obligations or any other economic provisions of
Operating Tenant thereunder.

 

(bb)         Lender
shall have received such other approvals, opinions, documents and information
in connection with the substitution as requested by the Rating Agencies if the
Loan is part of a Securitization, or as reasonably requested by Lender if the
Loan is not part of a Securitization.

 

(cc)         Lender
shall have received copies of all material contracts and agreements relating to
the leasing and operation of the Substitute Property (other than the Management
Agreement), each of which shall be in a form and substance which would be
satisfactory to a prudent institutional mortgage loan lender together with a
certification of Borrower attached to each such contract or agreement
certifying that the attached copy is a true and correct copy of such contract
or agreement and all amendments thereto.

 

(dd)         Lender
shall have received certified copies of all material consents, licenses and
approvals, if any, required in connection with the substitution of a Substitute
Property, and evidence that such consents, licenses and approvals are in full
force and effect.

 

(ee)         Lender
shall have received satisfactory (i.e., showing no Liens other than Permitted
Encumbrances) UCC searches, together with tax lien, judgment and litigation
searches with respect to the Substitute Property, and Borrower in the State
where the Substitute Property is located and the jurisdictions where such
Person has its principal place of business.

 

(ff)           If
Borrower owns a leasehold estate in the Substitute Property, Lender shall have
received, (i) a complete certified copy of the Ground Lease for the Substitute
Property, together with all amendments and modifications thereto and a recorded
memorandum thereof, which Ground Lease would be reasonably satisfactory in all
respects to a prudent institutional mortgage loan lender and which contains
customary leasehold mortgagee provisions and protections, and which shall
provide, among other things, (A) for a remaining term of no less than the
greater of (1) 20 years from the Maturity Date or (2) 10 years from the end of
the scheduled amortization term of the Loan, (B) that the Ground Lease shall
not be terminated until Lender has received notice of a default thereunder and
has had a reasonable opportunity to cure or complete foreclosure, and fails to
do so in a diligent manner, (C) for a new lease on the same terms to Lender as
tenant if the Ground Lease is terminated for any reason, (D) the non-merger of
fee and leasehold interests, and (E) that insurance proceeds and condemnation
awards (from the fee interest as well as the leasehold interest) will be
applied pursuant to the terms of this Agreement, and (ii) a ground lease
estoppel executed by the fee owner and ground lessor of the Substitute
Property, reasonably acceptable to a prudent institutional mortgage loan
lender.

 

(gg)         Borrower
shall submit to Lender, not less than twenty (20) Business Days prior to the
date of such substitution, a release of Lien (and related Loan Documents) for
the Replaced Property for execution by Lender. Such release shall be in a form
appropriate for the jurisdiction

 

45

 

in which the
Replaced Property is located and shall contain standard provisions, if any,
protecting the rights of the releasing lender.

 

(hh)         Borrower
stall deliver an Officers Certificate certifying that the requirements set
forth in this Section 2.6 have been satisfied.

 

(ii)           Upon
the satisfaction of the foregoing conditions precedent, Lender will release its
Lien from the Replaced Property and the Substitute Property shall be deemed to
be an Individual Property for purposes of this Agreement and the Substitute
Allocated Loan Amount with respect to such Substitute Property shall be deemed
to be the Allocated Loan Amount with respect to such Substitute Property for
all purposes hereunder.

 

Section
2.7            Purchase
of the Fee Estate of the Burlington Property.

 

Borrower (or
an Affiliate of Borrower, if Borrower chooses option (ii) set forth in
subsection (b) below of this Section 2.7) shall be entitled to purchase the Fee
Estate of that certain Individual Property Store No. 141 located at 313 North
Roosevelt Avenue, Burlington, Iowa, 52601 (the “Burlington Property”), provided
that (i) Lender receives thirty (30) days prior written notice of such acquisition,
(ii) no Event of Default has occurred and is continuing and (iii) upon the
satisfaction of the following conditions:

 

(a)           Borrower
shall have paid to Lender, concurrently with the closing of such acquisition,
all out-of-pocket costs and expenses, including reasonable attorneys’ fees,
incurred by Lender in connection with the purchase of the Burlington Property by
Borrower (or an Affiliate of Borrower, if Borrower chooses option (ii) set
forth in subsection (b) below of this Section 2.7);

 

(b)           Borrower,
without any cost to Lender, shall furnish any information requested by Lender (i)
relating to the purchase of the Fee Estate of the Burlington Property by
Borrower, for the preparation of, and shall authorize Lender to file and/or
record, new or amended and restated security instruments, financing statements
and financing statement amendments and other documents to the fullest extent
permitted by Applicable Law, and shall execute any additional documents related
thereto reasonably requested by Lender or (ii) relating to the purchase of the
Fee Estate of the Burlington Property by an Affiliate of Borrower and the
extension of that certain Ground Lease of the Burlington Property by Borrower
as tenant thereunder, in connection with the extension of the term of such
Ground Lease for an additional term of at least twenty (20) years beyond the
Maturity Date and providing for a rental rate thereunder of not more than nine
percent (9%) of the yield on the purchase price of the Burlington Property;

 

(c)           If
Borrower is the purchaser of the Fee Estate of the Burlington Property, Borrower
shall have delivered to Lender, without any cost or expense to Lender, such
endorsements to Lender’s Title Insurance Policy insuring that fee simple title
to the Burlington Property is vested in Borrower (subject to Permitted
Encumbrances), hazard insurance endorsements or certificates and other similar
materials as Lender may deem necessary at the time of the transfer, all in form
and substance reasonably satisfactory to Lender;

 

46

 

(d)           If
Borrower is the purchaser of the Fee Estate of the Burlington Property, Borrower
shall furnish an opinion of counsel satisfactory to Lender and its counsel that
all documents executed by Borrower, Guarantor and Indemnitor in connection with
the purchase of the Burlington Property have been duly authorized, executed and
delivered, and that the Security Instruments, and the other documents executed
in connection therewith are valid, binding and enforceable against Borrower in
accordance with their terms; and

 

(e)           The
Operating Lease and all of the Qualified Assignee Leases shall remain in full
force and effect during and after the completion of such transfer or extension
of the Operating Lease, as applicable, without abatement of rent; provided that
any increase in the rental rate under the Operating Lease shall be set forth in
an amendment to the Operating Lease as approved by Lender.

 

III.           CASH MANAGEMENT

 

Section
3.1            Establishment of Accounts.

 

(a)           Borrower
shall, simultaneously herewith, (i) establish, and hereby covenants to
maintain, an account (the “Property Account”) with Property Account Bank into
which Borrower shall deposit, or cause to be deposited, all Required Deposits,
and (ii) execute an agreement with Lender and the Property Account Bank
providing for the control of the Property Account by Lender substantially in a
form reasonably acceptable to Lender (the “Property Account Control Agreement”).

 

(b)           Lender
shall, simultaneously herewith, (i) establish accounts with the Lockbox Bank
(the “Lockbox Account”), into which Borrower shall deposit, or cause to be
deposited, sums on deposit in the Property Account, in accordance with the
terms hereof and (ii) execute an agreement (which may be this Agreement) with
the Lockbox Bank providing for the control of the Lockbox Account by Lender. The
following Accounts (which may be book entry sub-accounts), shall be established
in the Lockbox Account into which amounts in the Property Account shall be
deposited or allocated on the date or during the period so specified:

 

(i)               An
account with Lockbox Bank into which Borrower shall deposit, or cause to be
deposited, during any Triggering Event Period, the Monthly Tax Deposit (the “Tax
Account”);

 

(ii)              An
account with Lockbox Bank into which Borrower shall deposit, or cause to be
deposited, during any Triggering Event Period, the Monthly Insurance Premium
Deposit (the “Insurance Premium Account”);

 

(iii)             An
account with Lockbox Bank into which Borrower shall deposit, or cause to be
deposited, the Monthly Debt Service Payment Amount (the “Debt Service Account”);

 

47

 

(iv)             An
account with Lockbox Bank into which Borrower shall deposit, or cause to be
deposited, during any Triggering Event Period, the Replacement Reserve Monthly
Deposit (the “Replacement Reserve Account”);

 

(v)              An
account with Lockbox Bank into which Borrower shall deposit, or cause to be
deposited on the date hereof as set forth in Section 7.1.1 hereof, the Required
Repair Fund (the “Required Repair Account”);

 

(vi)             An
account with Lockbox Bank into which Borrower shall deposit, or cause to be
deposited, during any Triggering Event Period, the Monthly Ground Rent Deposit
(the “Ground Rent Account”);

 

(vii)            An
account with Lockbox Bank into which Borrower shall deposit, or cause to be
deposited, during any Lockbox Cash Flow Sweep Period, the Required Excess Cash
(the “Excess Cash Reserve Account”);

 

(viii)           An
account with Lockbox Bank into which Borrower shall deposit, or cause to be
deposited, during any Lockbox Cash Flow Sweep Period, the Operating Expenses
(the “Operating Expense Reserve Account”); and

 

(ix)             An
account with Lockbox Bank into which Borrower shall deposit, or cause to be
deposited, during any Lockbox Cash Flow Sweep Period, the Extraordinary
Expenses (the “Extraordinary Expense Reserve Account”).

 

Section
3.2            Deposits into Lockbox Account.

 

(a) Borrower represents, warrants and covenants that (i) Borrower
shall, or shall cause Manager (if any) to, immediately deposit all Required
Deposits into the Property Account, (ii) Borrower shall, or shall cause Manager
(if any) to, send instructions to the Tenants to pay all Required Deposits into
the Property Account, (iii) other than the Accounts, there shall be no other
accounts maintained by Borrower or any other Person into which Required
Deposits are deposited, and (iv) neither Borrower nor any other Person shall
open any other such account with respect to the Required Deposits.  Until deposited into the Lockbox Account, or
otherwise disbursed as provided herein prior to the occurrence of a Triggering
Event, any Required Deposits shall be deemed to be Collateral and shall be held
in trust by it for the benefit, and as the property, of Lender and shall not be
commingled with any other funds or property of Borrower.

 

(b)           (i)            Prior
to the occurrence of a Triggering Event, Lender shall direct the Property Account
Bank to transfer, on or before the immediately succeeding Business Day after
funds are received in the Property Account, funds sufficient to make all
deposits required pursuant to Section 3.7(b)(iv) hereof to the Lockbox Account
with any funds remaining in the Property Account Bank being transferred to
Borrower in such manner as may be specified by Borrower.

 

(ii)           After the occurrence of
a Triggering Event, Lender shall direct the Property Account Bank to transfer,
on each Business Day, all funds on deposit in the Property Account to the
Lockbox Account to the extent necessary to meet the amount required to be

 

48

 

deposited and maintained in such Accounts (as specified in Section 3.1
of this Agreement) and sufficient to make all deposits required pursuant to
Section 3.7(b)(i)-(vii) hereof to the Lockbox Account with any funds remaining
in the Property Account Bank being transferred to Borrower in such manner as
may be specified by Borrower.

 

(iii)          During any Lockbox Cash
Flow Sweep Period, Lender shall direct the Property Account Bank to transfer,
on each Business Day, all funds on deposit in the Property Account to the
Lockbox Account to be held and disbursed in accordance with Section 3.7 hereof.

 

(c)           Borrower warrants and
covenants that, unless otherwise expressly permitted in this Agreement,
Borrower shall not rescind, withdraw or change any notices or instructions
required to be sent by it pursuant to this Section 3.2 without Lender’s prior
written consent.

 

Section
3.3            Account Name.

 

(a)           The
Lockbox Account shall be in the name of Lender and shall also reference the
Borrower’s name in the account name.

 

(b)           In
the event Lender transfers or
assigns the Loan, Borrower acknowledges that (i) the Lockbox Bank, at Lender’s
request, shall change the name of the Lockbox Account to reference the name of
the transferee or assignee; and (ii) the Property Account Bank, at Lender’s
request, shall change the name of Lender under the Property Account Control
Agreement to reference the name of the transferee or assignee.  In the event Lender retains a servicer to
service the Loan, Borrower acknowledges that (i) the Lockbox Bank, at Lender’s
request, shall change the name of the Lockbox Account to reference the name of the
servicer, as agent for Lender; and (ii) the Property Account Bank, at Lender’s
request, shall change the name of Lender under the Property Account Control
Agreement to reference the name of the servicer, as agent for Lender.

 

Section
3.4            Eligible Accounts.

 

Borrower
shall, and Borrower shall cause Property Account Bank and Lockbox Bank to
maintain each Account as an Eligible Account.

 

Section
3.5            Permitted Investments.

 

All Accounts
shall, if invested, earn interest for the benefit of Borrower and Borrower
shall be responsible for all taxes due on interest earned thereon.  Sums on deposit in any Account other than the
Property Account shall be in interest bearing accounts for the benefit of
Borrower.  Borrower may direct Permitted
Investment absent a Triggering Event Period or a Lockbox Cash Flow Sweep Period;
provided, that Lender may direct that such accounts be invested in Permitted
Investments provided (i) such investments are then regularly offered by Lockbox
Bank for accounts of this size, category and type, (ii) such investments are
permitted by Applicable Law, (iii) the maturity date of the Permitted
Investment is not later than the date on which sums in the applicable Account
are anticipated by Lender to be required for payment of an obligation for which
such Account was created, and (iv) no Event of Default shall have occurred and
be continuing.  All income earned from
Permitted Investments shall be the property of Borrower.  Borrower hereby irrevocably authorizes and
directs Lockbox Bank, to hold any income earned

 

49

 

from Permitted Investments as part of the Accounts.  Borrower shall be responsible for payment of
any federal, State or local income or other tax applicable to income earned from
Permitted Investments.  No other
investments of the sums on deposit in the Accounts shall be permitted except as
set forth in this Section 3.5.  Lender
shall not be liable for any loss sustained on the investment of any funds
constituting the Reserve Funds or of any funds deposited in the related
Accounts.

 

Section
3.6            The Initial Deposits.

 

No initial
deposit amounts shall be required to be deposited in each of the Tax Account,
the Insurance Premium Account, the Replacement Reserve Account or, the Ground
Rent Account except that an amount equal to 125% of immediate repairs to the
Improvements shall be required to be deposited in the Required Repair Account,
(the “Initial Deposits”) on the Closing Date, which amount shall be disbursed
as provided in Section 7.1.2 hereof.

 

Section
3.7            Transfer To and Disbursements from the
Lockbox Account.

 

(a)           Lockbox
Bank shall withdraw all funds on deposit in the Lockbox Account on the date
immediately preceding each Payment Date (and if such day is not a Business Day
then the following day which is a Business Day).

 

(b)           Lockbox
Bank shall disburse the funds in the Lockbox Account, collected in accordance
with Section 3.1 and 3.2 above during the applicable periods, in the following
order of priority, as applicable:

 

(i)               First,
funds sufficient to pay the Monthly Ground Rent Deposit, if any, shall be
deposited in the Ground Rent Account;

 

(ii)              Second,
funds sufficient to pay the Monthly Tax Deposit, if any, shall be deposited in
the Tax Account;

 

(iii)             Third,
funds sufficient to pay the Monthly Insurance Premium Deposit, if any, shall be
deposited in the Insurance Premium Account;

 

(iv)             Fourth,
funds sufficient to pay the Monthly Debt Service Payment Amount shall be
deposited into the Debt Service Account;

 

(v)              Fifth,
funds sufficient to pay the Replacement Reserve Monthly Deposit shall be
deposited in the Replacement Reserve Account;

 

(vi)             Sixth,
funds sufficient to pay any interest accruing at the Default Rate, if any, and
late payment charges, if any, shall be deposited in the Debt Service Account;

 

(vii)            Seventh,
to the payment of Lockbox Bank for fees and expenses incurred in connection
with this Agreement and the accounts established hereunder;

 

50

 

(viii)           Eighth,
during any Lockbox Cash Flow Sweep Period, to the Operating Expense Reserve
Account, funds sufficient to pay all Operating Expenses which are not the
responsibility of an Operating Tenant, a Qualified Assignee or a Qualified
Subtenant to pay, which have been paid during such month by or on behalf of
Borrower in connection with the ownership and operation of the Properties in
accordance with the Approved Annual Budget to be held and disbursed in
accordance with the terms of Section 7.9 hereof;

 

(ix)             Ninth,
during any Lockbox Cash Flow Sweep Period, in the event that Borrower
identifies Extraordinary Expenses not otherwise set forth in the Approved
Annual Budget, then funds so identified by Borrower and approved by Lender may
be funded to the Extraordinary Expense Reserve Account, in an amount sufficient
to pay any Extraordinary Expenses for such month which have been approved by
Lender to be held and disbursed in accordance with the terms of Section 7.9
hereof;

 

(x)              Tenth,
during any Lockbox Cash Flow Sweep Period, the Required Excess Cash shall be
deposited into the Excess Cash Reserve Account;

 

(xi)             Eleventh,
provided no Event of Default shall exist under the Loan Documents, all amounts
remaining in the Lockbox Account after deposits for items (i) through (x) for
the current month and all prior months shall be disbursed to Borrower.

 

Section
3.8            Withdrawals From the Tax Account and the
Insurance Premium Account.

 

Lender shall
have the right to withdraw funds from the Tax Account to pay Taxes on or before
the date Taxes are due and payable. 
Lender shall have the right to withdraw funds from the Insurance Premium
Account to pay Insurance Premiums on or before the date Insurance Premiums are
due and payable.  Lockbox Bank shall
disburse funds from the Tax Account and the Insurance Premium Account in
accordance with Lender’s written request therefor on the Business Day following
Lockbox Bank’s receipt of such written request.

 

Section
3.9            Withdrawals
from the Replacement Reserve Account.

 

Lender shall
disburse funds on deposit in the Replacement Reserve Account in accordance with
the provisions of Section 7.3 hereof.

 

Section
3.10         Withdrawals
from the Excess Cash Reserve Account.

 

Lender shall
disburse funds on deposit in the Excess Cash Reserve Account in accordance with
the provisions of Section 7.8 hereof.

 

Section
3.11         Withdrawals from the Debt Service Account.

 

Lender shall
withdraw funds from the Debt Service Account to pay the Monthly Debt Service
Payment Amount on the date when due, together with any late payment charges or interest
accruing at the Default Rate, if any.

 

51

 

Section
3.12         Withdrawals
from the Operating Expense Reserve Account.

 

Lender shall
disburse funds on deposit in the Operating Expense Reserve Account in accordance
with the provisions of Section 7.9 hereof.

 

Section
3.13         Withdrawals
from the Extraordinary Expense Reserve Account.

 

Lender shall
disburse funds on deposit in the Extraordinary Expense Reserve Account in
accordance with the provisions of Section 7.9 hereof.

 

Section
3.14         Intentionally
Omitted.

 

Section
3.15         Withdrawals
from the Ground Rent Account.

 

Lender shall
have the right to withdraw funds from the Ground Rent Account in accordance
with Section 7.6 hereof.

 

Section
3.16         Sole Dominion and Control.

 

Borrower
acknowledges and agrees that the Accounts are subject to the sole dominion,
control and discretion of Lender, its authorized agents or designees, including
Property Account Bank and Lockbox Bank, subject to the terms hereof; and
Borrower shall have no right of withdrawal with respect to any Account except
with the prior written consent of Lender or as otherwise provided herein.

 

Section
3.17         Security Interest.

 

Borrower
hereby grants to Lender a first priority security interest in each of the Accounts
and the Account Collateral as additional security for the Debt.

 

Section
3.18         Rights on Default.

 

Notwithstanding
anything to the contrary in this Article 3, upon the occurrence and during the
continuance of an Event of Default, Lender shall promptly notify Property
Account Bank and Lockbox Bank in writing of such Event of Default and, without
notice from Property Account Bank, Lockbox Bank or Lender, (a) Borrower shall
have no further right in respect of (including, without limitation, the right to
instruct Lockbox Bank or Property Account Bank to transfer from) the Accounts,
(b) Lender may direct Lockbox Bank to liquidate and transfer any amounts then
invested in Permitted Investments to the Accounts or reinvest such amounts in
other Permitted Investments as Lender may reasonably determine is necessary to
perfect or protect any security interest granted or purported to be granted
hereby or pursuant to the other Loan Documents or to enable Lockbox Bank, as
agent for Lender, or Lender to exercise and enforce Lender’s rights and
remedies hereunder or under any other Loan Document with respect to any Account
or any Account Collateral, and (c) Lender shall have all rights and remedies
with respect to the Accounts and the amounts on deposit therein and the Account
Collateral as described in this Agreement and in the Security Instruments, in
addition to all of the rights and remedies available to a secured party under
the UCC, and, notwithstanding anything to the contrary contained in this
Agreement or in the Security Instruments, Lender may apply the

 

52

 

amounts of such Accounts as Lender determines in its sole discretion
including, but not limited to, payment of the Debt.

 

Section
3.19         Financing Statement; Further Assurances.

 

Borrower
hereby authorizes Lender to file a financing statement or statements under the
UCC in connection with any of the Accounts and the Account Collateral with
respect thereto in the form required to properly perfect Lender’s security
interest therein.  Borrower agrees that
at any time and from time to time, at the expense of Borrower, Borrower will
promptly execute and deliver all further instruments and documents, and take
all further action, that may be necessary, or that Lender may reasonably
request, in order to perfect and protect any security interest granted or
purported to be granted hereby (including, without limitation, any security
interest in and to any Permitted Investments) or to enable Lockbox Bank or
Lender to exercise and enforce their respective rights and remedies hereunder
with respect to any Account or Account Collateral.

 

Section
3.20         Borrower’s Obligation Not Affected.

 

The
insufficiency of funds on deposit in the Accounts shall not absolve Borrower of
the obligation to make any payments, as and when due pursuant to this Agreement
and the other Loan Documents, and such obligations shall be separate and
independent, and not conditioned on any event or circumstance whatsoever.

 

Section
3.21         Payments Received Under this Agreement.

 

Notwithstanding
anything to the contrary contained in this Agreement or the other Loan
Documents, and provided no Event of Default has occurred and is continuing,
Borrower’s obligations with respect to the monthly payment of Debt Service and
amounts due for the Tax and Insurance Escrow Fund, Ground Lease Escrow Fund,
Required Repair Fund, Replacement Escrow Fund, and any other payment reserves
established pursuant to this Agreement or any other Loan Document shall
(provided Lender is not prohibited from withdrawing or applying any funds in
the Accounts by Applicable Law or otherwise) be deemed satisfied to the extent
sufficient amounts are deposited in the Lockbox Account established pursuant to
this Agreement to satisfy such obligations on the dates each such payment is
required, regardless of whether any of such amounts are so applied by Lender.

 

Section
3.22         Letters
of Credit.

 

Notwithstanding anything herein
to the contrary, Borrower may meet its obligations to fund any or all of
the Initial Deposits or other deposits required to be made and maintained
during a Triggering Event Period, by delivering to Lender a Letter of Credit in
such amount as may be necessary to meet the deposit obligations herein.

 

53

 

IV.           REPRESENTATIONS
AND WARRANTIES

 

Section
4.1            Borrower Representations.

 

Borrower
represents and warrants as of the Closing Date that, except as expressly set
forth on Schedule IX attached hereto:

 

4.1.1        Organization.

 

Borrower is
duly organized and is validly existing and in good standing in the jurisdiction
in which it is organized, with requisite power and authority to own the
Properties and to transact the businesses in which it is now engaged.  Borrower is duly qualified to do business and
is in good standing in each jurisdiction where it is required to be so
qualified in connection with the Properties, its businesses and
operations.  Borrower possesses all
rights, licenses, permits and authorizations, governmental or otherwise,
necessary to entitle it to own the Properties and to transact the businesses in
which it is now engaged.  Attached hereto
as Schedule III is an organizational chart of Borrower.

 

4.1.2        Proceedings.

 

Borrower has
taken all necessary action to authorize the execution, delivery and performance
of this Agreement and the other Loan Documents. 
This Agreement and the other Loan Documents have been duly executed and
delivered by or on behalf of Borrower and constitute legal, valid and binding
obligations of Borrower enforceable against Borrower in accordance with their
respective terms, subject only to applicable bankruptcy, insolvency and similar
laws affecting rights of creditors generally, and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law).

 

4.1.3        No Conflicts.

 

The execution,
delivery and performance of this Agreement and the other Loan Documents by
Borrower will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, or result in the creation or
imposition of any Lien, charge or encumbrance (other than pursuant to the Loan
Documents) upon any of the property or assets of Borrower pursuant to the terms
of any indenture, mortgage, deed of trust, loan agreement, partnership
agreement, management agreement, or other agreement or instrument to which
Borrower is a party or by which any of Borrower’s property or assets is subject
except to the extent that such Lien, charge or encumbrance could not reasonably
be expected to have a Material Adverse Effect, nor will such action result in
any violation of the provisions of any statute or any order, rule or regulation
of any court or governmental agency or body having jurisdiction over Borrower
or any of the Properties or any of Borrower’s other assets, or any license or
other approval required to operate the Properties, and any consent, approval,
authorization, order, registration or qualification of or with any Governmental
Agency required for the execution, delivery and performance by Borrower of this
Agreement or any other Loan Documents have been obtained and is in full force
and effect.

 

4.1.4        Litigation.

 

There are no
actions, suits or proceedings at law or in equity by or before any Governmental
Authority or other agency now pending or threatened against or affecting
Borrower or any Individual Property, which actions, suits or proceedings, if
determined against

 

54

 

Borrower or any Individual Property could reasonably be expected to
have a Material Adverse Effect.

 

4.1.5        Agreements.

 

Borrower is
not a party to any agreement or instrument or subject to any restriction which
could reasonably be expected to have a Material Adverse Effect.  Borrower is not in default in any material
respect in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any agreement or instrument
to which it is a party or by which Borrower or any of the Properties is bound
that could reasonably be expected to have a Material Adverse Effect.  Borrower has no material financial obligation
under any indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which Borrower is a party or by which Borrower is a party or
by which Borrower or any Property is otherwise bound, other than (a)
obligations incurred in the ordinary course of the operation of such Property
and (b) obligations under the Loan Documents.

 

4.1.6        Solvency.

 

Borrower (a) has
not entered into the transaction or executed the Note, this Agreement or any
other Loan Documents with the actual intent to hinder, delay or defraud any
creditor and (b) has received reasonably equivalent value in exchange for its
obligations under the Loan Documents. 
Giving effect to the Loan, the fair saleable value of Borrower’s assets
exceeds and will, immediately following the making of the Loan, exceed Borrower’s
total liabilities, including, without limitation, subordinated, unliquidated,
disputed and contingent liabilities.  The
fair saleable value of Borrower’s assets is and will, immediately following the
making of the Loan, be greater than Borrower’s probable liabilities, including
the maximum amount of its contingent liabilities on its debts as such debts
become absolute and matured.  Borrower’s
assets do not and, immediately following the making of the Loan will not,
constitute unreasonably small capital to carry out its business as conducted or
as proposed to be conducted.  Borrower
does not intend to incur debt and liabilities (including contingent liabilities
and other commitments) beyond its ability to pay such debt and liabilities as
they mature (taking into account the timing and amounts of cash to be received
by Borrower and the amounts to be payable on or in respect of obligations of
Borrower).  No petition under the
Bankruptcy Code or similar state bankruptcy or insolvency law has been filed
against Borrower in the last seven (7) years, and Borrower in the last seven
(7) years has not ever made an assignment for the benefit of creditors or taken
advantage of any insolvency act for the benefit of debtors.  Neither Borrower nor any of its constituent
Persons are contemplating either the filing of a petition by it under the
Bankruptcy Code or similar state bankruptcy or insolvency law or the
liquidation of all or a major portion of Borrower’s assets or property, and
Borrower has no knowledge of any Person contemplating the filing of any such
petition against it or such constituent Persons.

 

4.1.7        Full and Accurate Disclosure.

 

No statement
of fact made by Borrower in this Agreement or in any of the other Loan
Documents contains any material untrue statement of a material fact or omits to
state any material fact necessary to make statements contained herein or
therein not misleading.  There is

 

55

 

no fact presently known to Borrower which has not been disclosed to
Lender which could reasonably be expected to have a Material Adverse Effect.

 

4.1.8        No Plan Assets.

 

Borrower is
not a Plan and none of the assets of Borrower constitute or will constitute “Plan
Assets” of one or more Plans.  In
addition, (a) Borrower is not a “governmental plan” within the meaning of
Section 3(32) of ERISA and (b) transactions by or with Borrower are not subject
to State statutes regulating investment of, and fiduciary obligations with
respect to, governmental plans similar to the provisions of Section 406 of
ERISA or Section 4975 of the Code currently in effect, which prohibit or
otherwise restrict the transactions contemplated by this Agreement.

 

4.1.9        Compliance.

 

To Borrower’s
knowledge, (i) Borrower and the Properties and the use thereof comply in all
material respects with all applicable Legal Requirements, including, without
limitation, (ii) all Environmental Laws, building and zoning ordinances and
codes except to the extent that such failure to comply could reasonably be
expected to have a Material Adverse Effect, (iii) Borrower is not in default or
violation of any order, writ, injunction, decree or demand of any Governmental
Authority the violation of which could reasonably be expected to have a
Material Adverse Effect, and (iv) there has not been committed by Borrower or
any other Person in occupancy of or involved with the operation or use of the
Properties any act or omission affording the federal government or any other
Governmental Authority the right of forfeiture as against any Individual
Property or any part thereof or any monies paid in performance of Borrower’s
obligations under any of the Loan Documents.

 

4.1.10      Financial Information.

 

To Borrower’s
knowledge, (i) all financial data, including, without limitation, the
statements of cash flow and income and operating expense, that have been
delivered to Lender in respect of Borrower and the Properties (i) are true,
complete and correct in all material respects, (ii) accurately represent the
financial condition of Borrower and the Properties, as applicable, as of the
date of such reports, and (iii) have been prepared in accordance with GAAP
throughout the periods covered, except as disclosed therein.  To Borrower’s knowledge, except for Permitted
Encumbrances, Borrower does not have any contingent liabilities, liabilities
for taxes, unusual forward or long-term commitments or unrealized or
anticipated losses from any unfavorable commitments that are known to Borrower
and are reasonably likely to have a Material Adverse Effect except as referred
to or reflected in said financial statements. 
To Borrower’s knowledge, since the date of such financial statements,
there has been no material adverse change in the financial condition,
operations or business of Borrower from that set forth in said financial
statements.

 

4.1.11      Condemnation.

 

No
Condemnation or other similar proceeding has been commenced or, to Borrower’s
knowledge, is threatened or contemplated with respect to all or any portion of
any Individual

 

56

 

Property or for the relocation of roadways providing access to any
Individual Property which could reasonably be expected to have a Material
Adverse Effect.

 

4.1.12      Federal Reserve Regulations.

 

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

 

4.1.13      Utilities and Public Access.

 

To Borrower’s
knowledge and except as shown on the Title Insurance Policy for the applicable
Individual Property, (i) each Individual Property has rights of access to
public ways and is served by public water, sewer, sanitary sewer and storm
drain facilities adequate to service such Individual Property for its
respective intended uses except to the extent that the failure to have such
right of access to public ways or failure of service could reasonably be
expected to have a Material Adverse Effect, (ii) all public utilities necessary
or convenient to the full use and enjoyment of each Individual Property are
located either in the public right-of-way abutting each Individual Property
(which are connected so as to serve each Individual Property without passing
over other property) or in recorded easements serving each Individual Property
and such easements are set forth in and insured by the Title Insurance Policy
except to the extent that the failure to have such easements could reasonably
be expected to have a Material Adverse Effect, and (iii) all roads necessary
for the use of each Individual Property for their current respective purposes
have been completed, are physically open (except as may be temporary for
repairs from time to time; provided that such temporary closure does not
violate any reciprocal easement agreement affecting any Individual Property)
and are dedicated to public use and have been accepted by all Governmental
Authorities except to the extent that the failure to have the same could
reasonably be expected to have a Material Adverse Effect.

 

4.1.14      Not a Foreign Person.

 

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

 

4.1.15      Separate Lots.

 

Either (i)
each Individual Property is assessed for real estate tax purposes as one or
more wholly independent tax lot or lots, separate from any adjoining land or
improvements not constituting a part of such lot or lots, and no other land or
improvements is assessed and taxed together with such Individual Property or
any portion thereof or (ii) Lender is escrowing for Taxes in accordance with
the terms hereof for the entire tax lot(s) of which each Individual Property is
a part.

 

57

 

4.1.16      Assessments.

 

To Borrower’s
knowledge, there are no pending or proposed special or other assessments for
public improvements or otherwise affecting any Individual Property, nor are
there any contemplated improvements to any Individual Property that may result
in such special or other assessments which could reasonably be expected to have
a Material Adverse Effect.

 

4.1.17      Enforceability.

 

The Loan
Documents are not subject to any right of rescission, set-off, counterclaim or
defense by Borrower, including the defense of usury, and Borrower has not
asserted any right of rescission, set-off, counterclaim or defense with respect
thereto.

 

4.1.18      No Prior Assignment.

 

There are no
prior assignments of the Leases or any portion of the Rents due and payable or
to become due and payable which are presently outstanding.

 

4.1.19      Insurance.

 

Borrower has
obtained and has delivered to Lender certified copies of all insurance policies
reflecting the insurance coverages, amounts and other requirements set forth in
this Agreement.  To Borrower’s knowledge,
no Person, including Borrower, has done, by act or omission, anything which
would impair the coverage of any such policy.

 

4.1.20      Use of Property.

 

Each
Individual Property is used exclusively for office,
distribution/warehouse, manufacturing or retail purposes and other appurtenant and related uses.

 

4.1.21      Certificate of Occupancy; Licenses.

 

To Borrower’s
knowledge, all material certifications, permits, licenses and approvals,
including without limitation, certificates of completion and occupancy permits
required for the legal use, occupancy and operation of each Individual Property
by Borrower, Operating Tenant or Tenant as a retail shopping store, office,
distribution/warehouse or manufacturing center (collectively, the “Licenses”),
have been obtained and are in full force and effect and are not subject to
revocation, suspension or forfeiture other than those licenses the lack of
which would not have a Material Adverse Effect. 
Borrower shall keep and maintain, or cause to be kept and maintained by
the Tenant, all Licenses necessary for the operation of each Individual
Property as a retail shopping store.  The
use being made of each Individual Property is in conformity with the
certificate of occupancy issued for such Individual Property except to the
extent that any non-conformity could reasonably be expected to have a Material
Adverse Effect.

 

4.1.22      Flood Zone.

 

None of the
Improvements on any Individual Property are located in an area as identified by
the Federal Emergency Management Agency as an area having special flood hazards
or, if so located, the flood insurance required pursuant to Section 6.1(a)(vii)
is in full force and effect with respect to each such Individual Property.

 

58

 

4.1.23      Physical Condition.

 

Except as
expressly disclosed in the Physical Conditions Reports, each Individual
Property, including, without limitation, all buildings, improvements, parking
facilities, sidewalks, storm drainage systems, roofs, plumbing systems, HVAC
systems, fire protection systems, electrical systems, equipment, elevators,
exterior sidings and doors, landscaping, irrigation systems and all structural
components, are in good condition, order and repair in all material respects;
there exists no structural or other material defects or damages in any
Individual Property, whether latent or otherwise, and Borrower has not received
notice from any insurance company or bonding company of any defects or
inadequacies in any Individual Property, or any part thereof, which would
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. 
Each Individual Property is free from damage covered by fire or other
casualty.  Except as expressly disclosed
in the Physical Conditions Reports, all liquid and solid waste disposal, septic
and sewer systems located on each Individual Property are in a good and safe
condition and repair and in compliance with all Legal Requirements.

 

4.1.24      Boundaries.

 

Except as
expressly disclosed in the Title Insurance Policies or the Surveys, all of the
Improvements which were included in determining the appraised value of each
Individual Property lie wholly within the boundaries and building restriction
lines of such Individual Property, and no improvements on adjoining properties
encroach upon such Individual Property, and no easements or other encumbrances
upon the applicable Individual Property encroach upon any of the Improvements.

 

4.1.25      Leases.

 

The Properties
are not subject to any Leases other than the Operating Leases, the Immaterial
Leases.  Borrower is the owner and lessor
of landlord’s interest in the Leases.  No
Person has any possessory interest in any Individual Property or right to
occupy the same except under and pursuant to the provisions of the Operating
Leases, the Immaterial Leases.  The
Operating Leases are in full force and effect and, there are no defaults by
Borrower or any the Operating Tenant thereunder, and there are no conditions
that, with the passage of time or the giving of notice, or both, would
constitute defaults under such Operating Lease. 
No Rent has been paid more than one (1) month in advance of its due
date.  There are no offsets or defenses
to the payment of any portion of the Rents. 
All work to be performed by Borrower under each Operating Lease has been
performed as required and has been accepted by the applicable Tenant, and any
payments, free rent, partial rent, rebate of rent or other payments, credits,
allowances or abatements required to be given by Borrower to any Tenant has
already been received by such Tenant. 
There has been no prior sale, transfer or assignment, hypothecation or
pledge of any Operating Lease or of the Rents received therein which is still
in effect.  Other than with respect to
Immaterial Leases, no Tenant has sublet all or any portion of the premises
demised thereby.  Other than in
connection with an Out-Parcel, no Tenant has a right or option pursuant to such
Lease or otherwise to purchase all or any part of the leased premises or the
building of which the leased premises are a part.  To Borrower’s knowledge, no Hazardous
Materials have been disposed, stored or treated by any Tenant under any
Operating Lease on or about the leased

 

59

 

premises nor does Borrower have any knowledge of any Operating Tenant’s
intention to use its leased premises for any activity which, directly or
indirectly, involves the use, generation, treatment, storage, disposal or
transportation of any Hazardous Materials, except those that are both (i) in
compliance with current Environmental Laws and with permits issued pursuant
thereto (if such permits are required), and (ii) either (A) in amounts not in
excess of that necessary to operate, clean, repair and maintain the applicable
Individual Property or each Operating Tenant’s business at such Individual
Property as set forth in the Operating Leases, (B) held by such Operating
Tenant for sale to the public in its ordinary course of business, or (C) fully
disclosed to and approved by Lender in writing pursuant to the Environmental
Reports.

 

4.1.26      Intentionally Omitted.

 

4.1.27      Intentionally Omitted.

 

4.1.28      Filing and Recording Taxes.

 

All transfer
taxes, deed stamps, intangible taxes or other amounts in the nature of transfer
taxes required to be paid by any Person under applicable Legal Requirements
currently in effect in connection with the transfer of the Properties to
Borrower have been paid.  All mortgage,
mortgage recording, stamp, intangible or other similar tax required to be paid
by any Person under applicable Legal Requirements currently in effect in
connection with the execution, delivery, recordation, filing, registration,
perfection or enforcement of any of the Loan Documents, including, without
limitation, the Security Instruments, have been paid.

 

4.1.29      Operating
Leases.

 

No fees
payable under any Operating Lease are due and unpaid.

 

4.1.30      Intentionally Omitted.

 

4.1.31      Illegal Activity.

 

No portion of
any Individual Property has been or will be purchased with proceeds of any
illegal activity and to Borrower’s knowledge, there are no illegal activities
or activities relating to any controlled substances at any Individual Property.

 

4.1.32      No Change in Facts or Circumstances;
Disclosure.

 

All
information submitted by Operating Tenant to Borrower and delivered by Borrower
to Lender and in all other financial statements, rent rolls, reports,
certificates and other documents submitted therewith in connection with the
Loan or in satisfaction of the terms thereof and all statements of fact made by
Borrower in this Agreement or in any other Loan Document, are, to Borrower’s
knowledge, accurate, complete and correct in all material respects.  To Borrower’s knowledge, there has been no
material adverse change in any condition, fact, circumstance or event that
would make any such information inaccurate, incomplete or otherwise misleading
in any material respect or that otherwise materially and adversely affects or
might materially and adversely affect the use, operation or value of the
Properties or the business operations or the financial condition of
Borrower.  Borrower has disclosed to
Lender all material

 

60

 

facts known to Borrower and has not failed to disclose any material
fact known to Borrower that could cause any information described in this
Section 4.1.32 or any representation or warranty made herein to be materially
misleading.

 

4.1.33      Investment Company Act.

 

Borrower is
not (a) an “investment company” or a company “controlled” by an “investment
company,” within the meaning of the Investment Company Act of 1940, as amended;
(b) 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 (c) subject to
any other federal or State law or regulation which purports to restrict or
regulate its ability to borrow money.

 

4.1.34      Principal Place of Business; State of
Organization.

 

Borrower’s
principal place of business as of the date hereof is the address set forth in
the introductory paragraph of this Agreement. 
Borrower is organized under the laws of the State of Delaware and each
Borrower’s organizational identification number is set forth on Exhibit A.

 

4.1.35      Single Purpose Entity.

 

Borrower
covenants and agrees that its organizational documents shall provide that it
has not, and shall not, and that the organizational documents of its general
partner(s), if Borrower is a partnership, or its managing member(s), if
Borrower is a limited liability company with multiple members (in each case, “Principal”)
shall provide that it has not and shall not:

 

(a)           with
respect to Borrower, engage in any business or activity other than the
acquisition, development, ownership, operation, leasing, disposition, managing
and maintenance of the Properties, and entering into the Loan, and activities
incidental thereto and with respect to Principal, engage in any business or
activity other than the ownership of its interest in Borrower, and activities
incidental thereto;

 

(b)           with
respect to Borrower, acquire or own any material assets other than (i) the
Properties, and (ii) such incidental Personal Property as may be necessary for
the operation of the Individual Property or Properties, as the case may be and
with respect to Principal, acquire or own any material asset other than its
interest in Borrower;

 

(c)           merge
into or consolidate with any person or entity or dissolve, terminate or
liquidate in whole or in part, transfer or otherwise dispose of all or
substantially all of its assets or change its legal structure;

 

(d)           (i)
fail to observe its organizational formalities or preserve its existence as an
entity duly organized, validly existing and in good standing (if applicable)
under the laws of the jurisdiction of its organization or formation, and
qualification to do business in the State where the Property or Properties is
located, if applicable, or (ii) without the prior written consent of Lender,
materially amend, materially modify, terminate or fail to comply with the
material provisions of Borrower’s Partnership Agreement, Articles of
Organization or similar organizational documents, as the case may be, or of
Principal’s

 

61

 

Certificate of Incorporation, Articles of
Organization or similar organizational documents, as the case may be, whichever
is applicable;

 

(e)           other
than Principal’s ownership interest in Borrower own any subsidiary or make any
investment in, any Person without the prior written consent of Lender;

 

(f)            commingle
its assets with the assets of any of its members, general partners, Affiliates,
principals or of any other Person or entity, participate in a cash management
system with any other entity or Person or fail to use its own separate
stationery, telephone number, invoices and checks;

 

(g)           with
respect to Borrower, incur any debt, secured or unsecured, direct or contingent
(including guaranteeing any obligation), other than the Debt, except for trade
payables in the ordinary course of its business of owning and operating the
Individual Property or Properties as applicable, provided that such debt (i) is
not evidenced by a note, (ii) is paid within sixty (60) days of the date
incurred, (iii) does not exceed, in the aggregate, one percent (1%) of the outstanding principal balance of the Note and (iv)
is payable to trade creditors and in amounts as are normal and reasonable under
the circumstances and with respect to Principal, incur any debt secured or
unsecured, direct or contingent (including guaranteeing any obligations);

 

(h)           (i)
fail to maintain its records (including financial statements), books of account
and bank accounts separate and apart from those of the members, general
partners, principals and Affiliates of Borrower or of Principal, as the case
may be, the Affiliates of a member, general partner or principal of Borrower or
of Principal, as the case may be, and any other Person, (ii) permit its assets
or liabilities to be listed as assets or liabilities on the financial statement
of any other Person or (iii) include the assets or liabilities of any other
Person on its financial statements; except that Borrower’s financial position,
assets, liabilities, net worth and operating results may be included in the
consolidated financial statements of an Affiliate, provided that such
consolidated financial statements contain a footnote indicating that Borrower
is a separate legal entity and that it maintains separate books and records;

 

(i)            enter
into any contract or agreement with any member, general partner, principal or
Affiliate of Borrower or of Principal, as the case may be, Guarantor,
Indemnitor, or any member, general partner, principal or Affiliate thereof
(other than a business management services agreement with an Affiliate of
Borrower, provided that (i) such agreement is acceptable to Lender, (ii) the
manager, or equivalent thereof, under such agreement holds itself out as an
agent of Borrower and (iii) the agreement meets the standards set forth in this
subsection (i) following this parenthetical), except upon terms and conditions
that are commercially reasonable, intrinsically fair and substantially similar
to those that would be available on an arms-length basis with third parties other
than any member, general partner, principal or Affiliate of Borrower or of
Principal, as the case may be, Guarantor, Indemnitor or any member, general
partner, principal or Affiliate thereof;

 

62

 

(j)            seek
the dissolution or winding up in whole, or in part, of Borrower or of
Principal, as the case may be;

 

(k)           fail
to correct any known misunderstandings regarding the separate identity of
Borrower, or of Principal, as the case may be, or any member, general partner,
principal or Affiliate thereof or any other Person;

 

(l)            guarantee
or become obligated for the debts of any other Person or hold itself out to be
responsible for the debts of another Person;

 

(m)          make
any loans or advances to any third party, including any member, general
partner, principal or Affiliate of Borrower or of Principal, as the case may
be, or any member, general partner, principal or Affiliate thereof, and shall
not acquire obligations or securities of any member, general partner, principal
or Affiliate of Borrower or Principal, as the case may be, or any member,
general partner, or Affiliate thereof;

 

(n)           fail
to file its own tax returns or be included on the tax returns of any other
Person except as required by Applicable Law;

 

(o)           fail
either to hold itself out to the public as a legal entity separate and distinct
from any other Person or to conduct its business solely in its own name or a
name franchised or licensed to it by an entity other than an Affiliate of
Borrower or of Principal, as the case may be, and not as a division or part of
any other entity in order not (i) to mislead others as to the identity with
which such other party is transacting business, or (ii) to suggest that
Borrower or Principal, as the case may be, is responsible for the debts of any
third party (including any member, general partner, principal or Affiliate of
Borrower, or of Principal, as the case may be, or any member, general partner,
principal or Affiliate thereof);

 

(p)           fail
to maintain adequate capital for the normal obligations reasonably foreseeable
in a business of its size and character and in light of its contemplated
business operations;

 

(q)           hold
itself out as or be considered as a department or division of (i) any general
partner, principal, member or Affiliate of Borrower or of Principal, as the
case may be, (ii) any Affiliate of a general partner, principal or member of
Borrower or of Principal, as the case may be, or (iii) any other Person;

 

(r)            fail
to allocate fairly and reasonably any overhead expenses that are shared with an
Affiliate, including paying for office space and services performed by any
employee of an Affiliate;

 

(s)           pledge
its assets for the benefit of any other Person, and with respect to Borrower,
other than with respect to the Loan;

 

(t)            fail
to maintain a sufficient number of employees in light of its contemplated
business operations;

 

63

 

(u)           fail
to provide in its (i) Articles of Organization, Certificate of Formation and/or
Operating Agreement, as applicable, if it is a limited liability company, (ii)
Limited Partnership Agreement, if it is a limited partnership or (iii)
Certificate of Incorporation, if it is a corporation, that for so long as the
Loan is outstanding pursuant to the Note, this Agreement and the other Loan
Documents, it shall not file or consent to the filing of any petition, either
voluntary or involuntary, to take advantage of any applicable insolvency,
bankruptcy, liquidation or reorganization statute, or make an assignment for
the benefit of creditors without the affirmative vote of each Independent
Director and of all other general partners/managing members/directors;

 

(v)           fail
to hold its assets in its own name;

 

(w)          if
Borrower or Principal is a corporation, fail to consider the interests of its
creditors in connection with all corporate actions to the extent permitted by
Applicable Law;

 

(x)            except
pursuant to the Guaranty, have any of its obligations guaranteed by an
Affiliate;

 

(y)           violate
or cause to be violated, the assumptions made with respect to Borrower and
Principal in the Insolvency Opinion;

 

(z)            with
respect to Principal, or Borrower, if Borrower is a single member limited
liability company that complies with the requirements of Section 4.1.35(bb)
below, fail at any time to have at least two (2) independent directors (each an “Independent Director”) that are not and have not been
for at least five (5) years: (a) a stockholder, director, officer, employee,
partner, member, attorney or counsel of Borrower or of Principal or any
Affiliate of either of them; (b) a customer, supplier or other Person who
derives its purchases or revenues (other than any fee paid to such director as
compensation for such director to serve as an Independent Director) from its
activities with Borrower, Principal or any Affiliate of either of them (a “Business
Party”); (c) a person or other entity controlling or under common control with
any such stockholder, partner, member, director, officer, attorney, counsel or
Business Party; or (d) a member of the immediate family of any such
stockholder, director, officer, employee, partner, member, attorney, counsel or
Business Party; or

 

(aa)         with
respect to Principal, or Borrower, if Borrower is a single member limited
liability company that complies with the requirements of Section 4.1.35(bb)
below, permit its board of directors to take any action which, under the terms
of any certificate of incorporation, by-laws, voting trust agreement with
respect to any common stock or other applicable organizational documents,
requires the unanimous vote of one hundred percent (100%) of the members of the
board without the vote of each Independent
Director.

 

(bb)         In
the event Borrower is a Delaware limited liability company that does not have a
managing member which complies with the requirements for a Principal under this
Section 4.1.35, the limited liability company agreement of Borrower (the “LLC

 

64

 

Agreement”) shall provide that (A) upon the occurrence
of any event that causes the last remaining member of Borrower (“Member”) to
cease to be the member of Borrower (other than (1) upon an assignment by Member
of all of its limited liability company interest in Borrower and the admission
of the transferee in accordance with the Loan Documents and the LLC Agreement,
or (2) the resignation of Member and the admission of an additional member of
Borrower in accordance with the terms of the Loan Documents and the LLC
Agreement), any person acting as Independent Director of Borrower shall,
without any action of any other Person and simultaneously with the Member
ceasing to be the member of Borrower, automatically be admitted to Borrower (“Special
Member”) and shall continue Borrower without dissolution and (B) Special Member
may not resign from Borrower or transfer its rights as Special Member unless
(1) a successor Special Member has been admitted to Borrower as Special Member
in accordance with requirements of Delaware law and (2) such successor Special Member
has also accepted its appointment as an Independent Director.  The LLC Agreement shall further provide that
(v) Special Member shall automatically cease to be a member of Borrower upon
the admission to Borrower of a substitute Member, (w) Special Member shall be a
member of Borrower that has no interest in the profits, losses and capital of
Borrower and has no right to receive any distributions of Borrower assets, (x)
pursuant to Section 18-301 of the Delaware Limited Liability Company Act (the “Act”),
Special Member shall not be required to make any capital contributions to
Borrower and shall not receive a limited liability company interest in
Borrower, (y) Special Member, in its capacity as Special Member, may not bind
Borrower and (z) except as required by any mandatory provision of the Act,
Special Member, in its capacity as Special Member, shall have no right to vote
on, approve or otherwise consent to any action by, or matter relating to,
Borrower, including, without limitation, the merger, consolidation or
conversion of Borrower; provided, however, such prohibition shall not limit the
obligations of Special Member, in its capacity as Independent Director, to vote
on such matters required by the LLC Agreement. 
In order to implement the admission to Borrower of Special Member,
Special Member shall execute a counterpart to the LLC Agreement.  Prior to its admission to Borrower as Special
Member, Special Member shall not be a member of Borrower.

 

Upon the
occurrence of any event that causes the Member to cease to be a member of
Borrower, to the fullest extent permitted by law, the personal representative
of Member shall, within ninety (90) days after the occurrence of the event that
terminated the continued membership of Member in Borrower, agree in writing (A)
to continue Borrower and (B) to the admission of the personal representative or
its nominee or designee, as the case may be, as a substitute member of
Borrower, effective as of the occurrence of the event that terminated the
continued membership of Member of Borrower in Borrower.  Any action initiated by or brought against
Member or Special Member under any Creditors Rights Laws shall not cause Member
or Special Member to cease to be a member of Borrower and upon the occurrence
of such an event, the business of Borrower shall continue without
dissolution.  The LLC Agreement shall
provide that each of Member and Special Member waives any right it might have
to agree in writing to dissolve Borrower upon the occurrence of any action
initiated by or brought against Member or Special Member under any Creditors
Rights Laws, or the occurrence of an event that causes Member or Special Member
to cease to be a member of Borrower.

 

65

 

4.1.36      Business Purposes.

 

The Loan is solely for the
business purpose of Borrower, and is not for personal, family, household, or
agricultural purposes.

 

4.1.37      Taxes.

 

Borrower has filed all
federal, State, county, municipal, and city income and other tax returns
required to have been filed by it and has paid all taxes and related
liabilities which have become due pursuant to such returns or pursuant to any
assessments received by it.  Borrower
knows of no basis for any additional material assessment in respect of any such
taxes and related liabilities for prior years.

 

4.1.38      Forfeiture.

 

No Borrower, and to Borrower’s
knowledge, no other Person in occupancy of or involved with the operation or
use any of the Properties, has committed any act or omission affording the
federal government or any State or local government the right of forfeiture as
against any of the Properties or any part thereof or any monies paid in
performance of Borrower’s obligations under the Note, this Agreement or the
other Loan Documents.  Borrower hereby
covenants and agrees not to commit, permit or suffer to exist any act or
omission affording such right of forfeiture.

 

4.1.39      Environmental Representations and Warranties.

 

Borrower represents and
warrants, except as disclosed in the written reports resulting from the
environmental site assessments of the Properties delivered to and approved by
Lender prior to the Closing Date (the “Environmental Report”) of each
Individual Property and to Borrower’s actual knowledge that: (a) there are no
Hazardous Materials or underground storage tanks in, on, or under any of the
Properties, except those that are both (i) in compliance with current
Environmental Laws and with permits issued pursuant thereto (if such permits
are required), and (ii) either (A) in amounts not in excess of that necessary
to operate, clean, repair and maintain the applicable Individual Property or
each Tenant’s respective business at such Individual Property as set forth in
their respective Leases, or (B) held by a Tenant for sale to the public in its
ordinary course of business, (b) there are no past, present or threatened
Releases of Hazardous Materials in violation of any Environmental Law and which
would require remediation by a Governmental Authority in, on, under or from any
of the Properties; (c) there is no threat of any Release of Hazardous Materials
migrating to any of the Properties; (d) there is no past or present material
non-compliance with current Environmental Laws, or with permits issued pursuant
thereto, in connection with any of the Properties except as described in the
Environmental Reports; (e) Borrower does not know of, and has not received, any
written or oral notice or other communication from any Person (including but
not limited to a Governmental Authority) relating to Hazardous Materials in,
on, under or from any of the Properties; and (f) Borrower has truthfully and
fully provided to Lender, in writing, any and all information relating to
environmental conditions in, on, under or from any of the Properties known to
Borrower or contained in Borrower’s files and records, including but not
limited to any reports relating to 

 

66

 

Hazardous Materials in, on,
under or migrating to or from any of the Properties and/or to the environmental
condition of the Properties.

 

4.1.40      Taxpayer Identification Number.

 

Borrower’s United States
taxpayer identification number is set forth on Exhibit A.

 

4.1.41      OFAC.

 

Borrower represents and
warrants that neither Borrower, Guarantor, Indemnitor or any of their
respective Affiliates is a Prohibited Person, and Borrower, Guarantor,
Indemnitor and their respective Affiliates are in full compliance with all
applicable orders, rules, regulations and recommendations of The Office of
Foreign Assets Control of the U.S. Department of the Treasury.

 

4.1.42      Ground
Lease Representations.

 

Except as expressly set forth in an estoppel
certificate received by Lender from a Fee Owner:

 

(a)           (i) Each Ground Lease is in full
force and effect and has not been modified or amended in any manner whatsoever,
(ii) there are no defaults under any Ground Lease by Borrower, or, to Borrower’s
actual knowledge, landlord thereunder, and, to Borrower’s actual knowledge, no
event has occurred which but for the passage of time, or notice, or both would
constitute a default under such Ground Lease, (iii) all rents, additional rents
and other sums due and payable under each Ground Lease have been paid in full,
(iv) neither Borrower nor, to Borrower’s actual knowledge, the landlord under
each Ground Lease has commenced any action or given or received any notice for
the purpose of terminating such Ground Lease, (v) to Borrower’s actual
knowledge, no Fee Owner, as debtor in possession or by a trustee for such Fee
Owner,   has given any notice of, and
Borrower has not consented to, any attempt to transfer the related Fee Estate
free and clear of such Ground Lease under section 363(f) of the Bankruptcy
Code, and (vi) to Borrower’s actual knowledge, no Fee Owner under any Ground
Lease is subject to any voluntary or involuntary bankruptcy, reorganization or
insolvency proceeding and no Fee Estate with respect to any Ground Lease is an
asset in any  voluntary or involuntary
bankruptcy, reorganization or insolvency proceeding.

 

(b)           The Ground Leases or a memorandum
thereof have been duly recorded, the Ground Leases do not prohibit the interest
of the lessee thereunder to be encumbered by the applicable Security
Instrument, and to Borrower’s actual knowledge based on estoppel letters with
respect to such Ground Lease, there has not been any change in such terms of
the Ground Leases since their recordation; and

 

(c)           Except as indicated in the related
Title Insurance Policy, Borrower’s interest in the Ground Leases are not subject
to any Liens superior to, or of equal priority with, the applicable Security
Instrument.

 

67

 

4.1.43      Deposit
Accounts.

 

(a)           This
Agreement and the Property Account Control Agreement create valid and continuing
security interests (as defined in the UCC) in the Property Accounts and the
Lockbox Account in favor of Lender, which security interests are prior to all
other Liens and are enforceable as such against creditors of and purchasers
from Borrower;

 

(b)           Borrower and Lender
agree that the Property Account is and shall be maintained (i) as a “deposit
account” (as such term is defined in Section 9-102(a)(29) of the UCC), (ii) in
such a manner that Lender shall have control (within the meaning of Section 9-104(a)(2)
of the UCC) over the Property Account and (iii) such that neither Borrower nor
Manager shall have any right of withdrawal from the Property Account and no
Account Collateral shall be released to Borrower or Manager from the Property
Account.  Without limiting Borrower’s
obligations under the immediately preceding sentence, Borrower shall only
establish and maintain the Property Account with a financial institution that
has executed an agreement substantially in the form of the Property Account Control
Agreement or in such other form reasonably acceptable to Lender.

 

(c)           Borrower
and Lender agree that each Account other than the Property Account is and shall
be maintained (i) as a “securities account” (as such term is defined in Section
8-501(a) of the UCC), (ii) in such a manner that Lender shall have control
(within the meaning of Section 8-106(d)(2) of the UCC) over each such Account
other than the Property Accounts, (iii) such that neither Borrower nor Manager
shall have any right of withdrawal from such Accounts and, except as provided
herein, no Account Collateral shall be released to Borrower from such Accounts,
(iv) in such a manner that the Lockbox Bank shall agree to treat all property
credited to each Account other than the Property Accounts as “financial assets”
and (v) such that all securities or other property underlying any financial
assets credited to such Accounts shall be registered in the name of Lockbox
Bank, indorsed to Lockbox Bank or in blank or credited to another securities account
maintained in the name of Lockbox Bank and in no case will any financial asset
credited to any such Accounts be registered in the name of Borrower, payable to
the order of Borrower or specially indorsed to Borrower except to the extent
the foregoing have been specially indorsed to Lockbox Bank or in blank);

 

(d)           Borrower
owns and has good and marketable title to the Property Accounts and the Lockbox
Account free and clear of any Lien or claim of any Person other than those
granted pursuant to the Loan Documents;

 

(e)           Borrower has
delivered to Lender fully executed agreements pursuant to which Property
Account Bank and Lockbox Bank have agreed to comply with all instructions
originated by Lender directing disposition of the funds in such accounts without
further consent by Borrower;

 

(f)            Other
than the security interest granted to Lender pursuant to this Agreement and the
Property Account Control Agreement, Borrower has not pledged, assigned, or
sold, granted a security interest in, or otherwise conveyed any of the Property
Accounts, or the Lockbox Account; and

 

68

 

(g)           The
Property Accounts and the Lockbox Account are not in the name of any Person
other than Borrower or Lender.  Borrower
has not consented to the Property Account Banks or the banks maintaining the
Lockbox Account complying with instructions of any Person other than Lender.

 

4.1.44      Embargoed Person.

 

As of the date hereof and at
all times throughout the term of the Loan, including after giving effect to any
Transfers permitted pursuant to the Loan Documents, (a) none of the funds or
other assets of Borrower, Principal, Indemnitor and Guarantor constitute
property of, or are beneficially owned, directly or indirectly, by any person,
entity or government subject to trade restrictions under U.S. law, including
but not limited to, the International Emergency Economic Powers Act, 50 U.S.C.
§§ 1701 et seq., The Trading with the Enemy Act, 50 U.S.C. App. 1 et seq., and
any Executive Orders or regulations promulgated thereunder with the result that
the investment in Borrower, Principal, Indemnitor or Guarantor, as applicable
(whether directly or indirectly), is prohibited by law or the Loan made by
Lender is in violation of law (“Embargoed Person”); (b) no Embargoed Person has
any interest of any nature whatsoever in Borrower, Principal, Indemnitor or
Guarantor, as applicable, with the result that the investment in Borrower,
Principal, Indemnitor or Guarantor, as applicable (whether directly or indirectly),
is prohibited by law or the Loan is in violation of law; and (c) none of the
funds of Borrower, Principal, Indemnitor or Guarantor, as applicable, have been
derived from any unlawful activity with the result that the investment in
Borrower, Principal, Indemnitor or Guarantor, as applicable (whether directly
or indirectly), is prohibited by law or the Loan is in violation of law.

 

Section
4.2            Survival of
Representations.

 

Borrower agrees that all of
the representations and warranties of Borrower set forth in Section 4.1 and
elsewhere in this Agreement and in the other Loan Documents shall be made
effective as of the date hereof and shall survive for so long as any amount
remains owing to Lender under this Agreement or any of the other Loan Documents
by Borrower; provided that in no event shall such survival pursuant to this
Section 4.2 extend beyond (i) payment in full of the Debt, or (ii) with respect
to an Individual Property, the release of such Individual Property from the
applicable Security Instrument.  All
representations, warranties, covenants and agreements made in this Agreement or
in the other Loan Documents by Borrower shall be deemed to have been relied
upon by Lender notwithstanding any investigation heretofore or hereafter made
by Lender or on its behalf.

 

V.            BORROWER
COVENANTS

 

Section
5.1            Affirmative
Covenants.

 

From the date hereof and
until payment and performance in full of all obligations of Borrower under the
Loan Documents or the earlier release of the Liens of all Security Instruments encumbering
the Properties (and all related obligations) in accordance with the terms of
this Agreement and the other Loan Documents, Borrower hereby covenants and
agrees with Lender that:

 

69

 

5.1.1        Existence; Compliance with Legal Requirements.

 

Borrower shall do, or cause
to be done, all things necessary to preserve, renew and keep in full force and
effect its existence, rights, licenses, permits and franchises, and comply, in
all material respects, with all Legal Requirements applicable to it and the
Properties other than those the lack of which could not reasonably be expected
to have a Material Adverse Effect.  There
shall never be committed by Borrower or any other Person in occupancy of or
involved with the operation or use of the Properties any act or omission
affording the federal government or any State or local government the right of
forfeiture against any Individual Property or any part thereof or any monies
paid in performance of Borrower’s obligations under any of the Loan
Documents.  Borrower hereby covenants and
agrees not to commit, permit or suffer to exist any act or omission affording
such right of forfeiture.  Borrower shall
(i) at all times maintain, preserve and protect all franchises and trade names
and preserve all the remainder of its property used or useful in the conduct of
its business, and (ii) except as otherwise expressly provided in this Loan
Agreement, keep, or cause to be kept, the Properties in good working order and
repair, and from time to time make, or cause to be made, all reasonably
necessary repairs, renewals, replacements, betterments and improvements
thereto, all as more fully provided in the Security Instruments only to the
extent that a failure to comply with either of sub-clauses (i) or (ii) could
reasonably be expected to have a Material Adverse Effect.  Borrower shall keep, or cause to be kept, the
Properties insured at all times by financially sound and reputable insurers, to
such extent and against such risks, and maintain liability and such other
insurance, as is more fully provided in this Agreement.

 

5.1.2        Taxes and Other Charges.

 

Borrower shall pay (or cause
to be paid) all Taxes and Other Charges now or hereafter levied or assessed or
imposed against the Properties or any part thereof as the same become due and
payable.  Borrower shall furnish (or
cause to be furnished) to Lender receipts, or other evidence for the payment of
the Taxes and the Other Charges prior to the date the same shall become
delinquent (provided, however, that Borrower is not required to furnish such
receipts for payment of Taxes in the event that such Taxes have been paid by
Lender pursuant to Section 7.2 hereof). 
Borrower shall not suffer and shall promptly cause to be paid and
discharged any Lien or charge whatsoever which may be or become a Lien or
charge against the Properties, and shall promptly pay (or cause to be paid) all
utility services provided to the Properties. 
After prior written notice to Lender, Borrower or Operating Tenant, at
its own expense, may contest by appropriate legal proceeding, promptly
initiated and conducted in good faith and with due diligence, the amount or
validity or application in whole or in part of any Taxes or Other Charges,
provided that (i) no Default or Event of Default has occurred and remains
uncured; (ii) such proceeding shall be permitted under and be conducted in
accordance with the provisions of any other instrument to which Borrower is
subject and shall not constitute a default thereunder and such proceeding shall
be conducted in accordance with all Applicable Laws; (iii) no Individual
Property nor any part thereof or interest therein will be in danger of being
sold, forfeited, terminated, cancelled or lost; (iv) Borrower shall promptly
upon final determination thereof pay (or cause to be paid) the amount of any
such Taxes or Other Charges, together with all costs, interest and penalties
which may be payable in connection therewith; (v) such proceeding shall suspend
the collection of such contested Taxes or Other Charges from the applicable
Individual Property; and (vi) Borrower shall furnish (or cause to be furnished)
such security as may be required in the proceeding.  Lender may apply such security or part
thereof held by Lender at any time when, in the judgment of Lender, the validity
or applicability of such

 

70

 

Taxes or Other Charges are
established or any Individual Property (or part thereof or interest therein)
shall be in danger of being sold, forfeited, terminated, cancelled or lost or
there shall be any danger of the Lien of any Security Instrument being primed
by any related Lien.

 

5.1.3        Litigation.

 

Borrower shall give prompt
written notice to Lender of any litigation or governmental proceedings pending
or threatened against Borrower which could reasonably be expected to have a
Material Adverse Effect.

 

5.1.4        Access to Properties.

 

Borrower shall permit
agents, representatives and employees of Lender, subject to the rights of
Tenants, landlords, licensees or other occupants, to inspect the Properties or
any part thereof at reasonable hours upon reasonable advance notice.

 

5.1.5        Notice of Default.

 

Borrower shall promptly
advise Lender of any Material Adverse Effect, or of the occurrence of any
Default or Event of Default of which Borrower has knowledge.

 

5.1.6        Cooperate in Legal Proceedings.

 

Borrower shall cooperate
fully with Lender with respect to any proceedings before any court, board or
other Governmental Authority which may in any way materially adversely affect
the rights of Lender hereunder or any rights obtained by Lender under any of
the other Loan Documents and, in connection therewith, permit Lender, at its
election, to participate in any such proceedings.

 

5.1.7        Award and Insurance Benefits.

 

Subject to Section 6.4
hereof, Borrower shall cooperate with Lender in obtaining for Lender the
benefits of any Awards or Insurance Proceeds lawfully or equitably payable in
connection with any Individual Property, and Lender shall be reimbursed (to the
extent provided for in the Loan Documents) for any expenses incurred in
connection therewith (including reasonable attorneys’ fees and disbursements,
and the payment by Borrower of the expense of an appraisal on behalf of Lender
in case of Casualty or Condemnation affecting any Individual Property or any
part thereof) out of such Award or Insurance Proceeds.

 

5.1.8        Further Assurances.

 

Borrower shall, at Borrower’s
sole cost and expense, execute and deliver to Lender such documents, instruments,
certificates, assignments and other writings, and do such other acts necessary
or desirable, to evidence, preserve and/or protect the collateral at any time
securing or intended to secure the obligations of Borrower under the Loan
Documents, as Lender may reasonably require including, without limitation, the
authorization of Lender to file UCC financing statements.

 

71

 

5.1.9        Mortgage and Intangible Taxes.

 

Borrower shall pay all
State, county and municipal recording, mortgage, intangible, and all other
taxes imposed upon the execution and recordation of the Security Instruments
and/or upon the execution and delivery of the Note.

 

5.1.10      Financial Reporting.

 

Borrower shall (and shall
cause the Operating Tenants to) keep adequate books and records of account in
accordance with GAAP, or in accordance with other methods reasonably acceptable
to Lender, consistently applied and shall furnish to Lender:

 

(a)           quarterly and annual statements of
Operating Tenant and its consolidated subsidiaries within sixty (60) days after
the end of each fiscal quarter or one hundred twenty (120) days after the close
of each Fiscal Year of Operating Tenant, as applicable;

 

(b)           quarterly and annual operating statements of each Individual
Property in the form required by Lender (and in substantially the form
previously submitted to Lender in connection with the making of the Loan),
detailing the (i) sales per square foot at each Individual Property, (ii)
occupancy costs of each Individual Property and (iii) Capital Expenditures of
each Individual Property (the “Individual Store Capital Expenditure Schedule”)
(each such operating statement of each Individual Property, a “Mini Report”),
within sixty (60) days after the end of each fiscal quarter or one hundred
twenty (120) days after the close of each Fiscal Year of Borrower, as
applicable;

 

(c)           quarterly and annual balance sheets, profit and loss
statements, statements of cash flows, and statements of change in financial
position of Borrower and its consolidated subsidiaries together with a
calculation reflecting the annual debt service coverage ratio for the Loan for
the immediately preceding twelve (12) month period (or such shorter period
beginning on the date hereof with respect to the Borrower) as of the last day
of such month accompanied by an Officer’s Certificate with respect thereto,
within sixty (60) days after the end of each fiscal quarter or one hundred
twenty (120) days after the close of each fiscal year of Borrower; and

 

(d)           quarterly and annual P&L Reports from the Operating
Tenants (with the annual financial statements audited
by an Acceptable Accountant) together with (i) an Officer’s Certificate of Operating
Tenant certifying to the calculation reflecting the EBITDAR Ratio and (ii) an
Officer’s Certificate from of Borrower certifying that said P&L Report and
such audited financial statements of the Operating Tenant delivered to Lender
hereunder are true and correct copies thereof received from the Operating
Tenant, which shall be delivered within sixty (60) days after the end of each
fiscal quarter or one hundred twenty (120) days after the close of each fiscal
year of the Operating Tenants.

 

(e)           For the partial year period commencing upon a Triggering
Event, and for each Fiscal Year during a Triggering Event Period, Borrower
shall submit to Lender an Annual Budget for the Properties not later than
thirty (30) days prior to the commencement of such period or Fiscal Year in
form reasonably satisfactory to Lender, and shall be subject to Lender’s
written approval (each such Annual Budget after it has

 

72

 

been approved in writing by Lender shall be hereinafter referred to as
an “Approved Annual Budget”).  In the
event that Lender objects to a 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 promptly 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 promptly revise the
same in accordance with the process described in this subsection until Lender
approves the Annual Budget.  Until such
time that Lender approves a proposed Annual Budget, the most recently Approved
Annual Budget shall apply; provided that, such Approved Annual Budget shall be
adjusted to reflect actual increases in Taxes, Insurance Premiums and utilities
expenses.

 

(f)            Borrower shall furnish to Lender, within ten (10)
Business Days after request such further detailed information with respect to
the operation of the Properties and the financial affairs of Borrower as may be
reasonably requested by Lender.

 

(g)           Any reports, statements or other information required to
be delivered under this Agreement shall be delivered (i) in paper form, (ii) on
a diskette, and (iii) if requested by Lender and within the capabilities of
Borrower’s data systems without change or modification thereto, in electronic
form and prepared either (I) Microsoft Word for Windows or (II) WordPerfect for
Windows software (which files may be prepared using a spreadsheet program and
saved as word processing files).

 

(h)           Borrower agrees that Lender may forward to each purchaser,
transferee, assignee, servicer, participant, or investor in all or any portion
of the Loan or any Securities (collectively, the “Investor”) or any Rating
Agency rating such participations and/or Securities and each prospective
Investor, and any organization maintaining databases on the underwriting and
performance of commercial mortgage loans, all documents and information which
Lender now has or may hereafter acquire relating to the Debt and to Borrower,
any Guarantor, any Indemnitor and the Properties, whether furnished by
Borrower, any Guarantor, any Indemnitor or otherwise, as Lender determines
necessary or desirable.  Borrower
irrevocably waives any and all rights it may have under any Applicable Laws to
prohibit such disclosure, including, but not limited, to any right of privacy.  Notwithstanding the foregoing, Lender agrees
to treat as confidential, and to not disclose without the Operating Tenant’s
written consent, all income and expense statements for the business at each
Individual Property and any other information specific to an Individual
Property including, but not limited to, the reports delivered under Sections
5.1.10(a), (b) and (d) (collectively, the “Confidential Information”);
provided, however, that Confidential Information does not include information
which (i) is already known to Lender prior to receipt as evidenced by prior
documentation thereof or has been independently developed by Lender on a
non-confidential basis; (ii) is or becomes generally available to the public
other than as a result of an improper disclosure by Lender or its
representatives; (iii) becomes available to Lender on a non-confidential basis
from a source other than the Operating Tenant, Borrower or any of their
representatives, provided that such source is not, to Lender’s

 

73

 

knowledge, bound by a confidentiality agreement with or other
contractual, legal or fiduciary obligation of confidentiality to the Operating
Tenant or Borrower with respect to such information; or (iv) is disclosed
pursuant to a requirement of a court, administrative agency or other regulatory
or governmental body or is disclosed pursuant to applicable law, rule or
regulation.  Notwithstanding the
foregoing, Lender may, without the written consent of Borrower or the Operating
Tenant, disclose any Confidential Information solely to a trustee in connection
with a Securitization or a Rating Agency involved with respect to such
Securitization (collectively, the “Disclosure Parties”) and the Disclosure
Parties may further disclose the Confidential Information solely to “B-piece
buyers” in connection with the Securitization or an institutional investor that
typically invests in Securitizations of this type and size (“Other Parties”) to
the extent the Disclosure Parties 
customarily disclose the same to the Other Parties in connection with
the Securitization and to the extent requested by the Other Parties; provided
that (A) the Disclosure Parties and the Other Parties are advised that the
Confidential Information is confidential, (B) the Confidential Information may
not be placed in any prospectus, or other Securities offering material or other
written materials by Lender, or any trustee or Rating Agency or any Affiliate,
and (C) the Disclosure Parties and the Other Parties (other than the Rating
Agencies which are not required to execute a Confidentiality Agreement but may
only disclose information to parties that have executed a Confidentiality
Agreement), execute a confidentiality agreement substantially in the form
attached hereto as Exhibit E, or such other form as reasonably agreed
upon by the Operating Tenant, the Disclosure Parties and/or the Other Parties
(the “Confidentiality Agreement”). 
Notwithstanding anything to the contrary contained in this Section, (a)
in no event shall any Confidential Information be disclosed to any retailers,
and (b) Landlord and Operating Tenant understand and agree that the Disclosure
Parties may disclose any information in connection with Operating Tenant and
the Properties on an aggregate, loan-portfolio basis.

 

5.1.11      Business and Operations.

 

Borrower will continue to
engage in the businesses presently conducted by it as and to the extent the
same are necessary for the ownership, maintenance, management and operation of
the Properties.  Borrower will remain in
good standing under the laws of each jurisdiction to the extent required for
the ownership, maintenance, management and operation of the Properties.

 

5.1.12      Costs of Enforcement.

 

In the event (a) that any
Security Instrument encumbering any Individual Property is foreclosed in whole
or in part or that any such Security Instrument is put into the hands of an
attorney for collection, suit, action or foreclosure, (b) of the foreclosure of
any mortgage prior to or subsequent to any Security Instrument encumbering any
Individual Property in which proceeding Lender is made a party, or (c) of the
bankruptcy, insolvency, rehabilitation or other similar proceeding in respect
of Borrower or any of its constituent Persons or an assignment by Borrower or
any of its constituent Persons for the benefit of its creditors, Borrower, its
successors or assigns, shall be chargeable with and agrees to pay all costs of
collection and defense, including reasonable attorneys’ fees and costs,
incurred by Lender or Borrower in

 

74

 

connection therewith and in
connection with any appellate proceeding or post-judgment action involved
therein, together with all required service or use taxes.

 

5.1.13      Estoppel Statement.

 

(a)           After written request by Lender, Borrower shall within ten
(10) days furnish Lender with a statement, duly acknowledged and certified,
setting forth (i) the amount of the original principal amount of the Note, (ii)
the unpaid principal amount of the Note, (iii) the Applicable Interest Rate of
the Note, (iv) the date installments of interest and/or principal were last
paid, (v) any offsets or defenses to the payment of the Debt, and (vi) that the
Note, this Agreement, the Security Instruments and the other Loan Documents are
valid, legal and binding obligations and have not been modified or if modified,
giving particulars of such modification.

 

(b)           Borrower shall use its best efforts to deliver to Lender,
promptly upon written request, duly executed estoppel certificates from the
Operating Tenants, the Qualified Assignees and the Qualified Subtenants
attesting to such facts as Lender may require, including, but not limited to
attestations that the applicable Leases are in full force and effect with no
defaults thereunder on the part of any party, that none of the Rents have been
paid more than one month in advance, and that the Operating Tenants, the
Qualified Assignees or the Qualified Subtenants, as the case may be, claim no
defense or offset against the full and timely performance of its obligations
under the applicable Leases.

 

5.1.14      Loan Proceeds.

 

Borrower shall use the
proceeds of the Loan received by it on the Closing Date only for the purposes
set forth in Section 2.1.4.

 

5.1.15      Performance by Borrower.

 

Borrower shall in a timely
manner observe, perform and fulfill each and every covenant, term and provision
of each Loan Document executed and delivered by, or applicable to, Borrower,
and shall not enter into or otherwise suffer or permit any amendment, waiver,
supplement, termination or other modification of any Loan Document executed and
delivered by, or applicable to, Borrower without the prior written consent of
Lender.

 

5.1.16      Confirmation of Representations.

 

Borrower shall deliver, in
connection with any Securitization, (a) one or more Officer’s Certificates
certifying as to the accuracy of all representations made by Borrower in the
Loan Documents as of the date of the closing of such Securitization in all
relevant jurisdictions, and (b) certificates of the relevant Governmental
Authorities in all relevant jurisdictions indicating the good standing and
qualification of Borrower and Principal as of the date of the closing of such
Securitization.

 

5.1.17      Leasing Matters.

 

(a)           Other than as provided in Section 5.1.17(b), Borrower may
not, without the prior written consent of Lender, enter into, amend, modify or
waive the provisions of any material

 

75

 

provisions of any Lease, including, but not limited to, provisions
relating to the term, the rental obligations of the Operating Tenant or Tenant
thereunder or any other economic provisions of the Operating Lease or any Lease
(other than an Immaterial Lease) or terminate, reduce Rents under, accept a
surrender of space under, or shorten the term of, any Lease (other than an
Immaterial Lease), including, without limitation, the Operating Leases and the
Qualified Assignee Leases (including any guaranty, letter of credit or other
credit support with respect thereto).

 

(b)           Subject to the Square Footage Limitations and the other
provisions hereof, Borrower may allow Operating Tenant to assign portions of
the Operating Leases; provided, that no more than ten percent (10%) of the
retail space (by square footage) may be assigned to a Tenant that is not a national
or regional retailer.  In connection with
such assignment, (i) Operating Tenant may be relieved of its obligations under
that portion of the Operating Lease so assigned and (ii) any such assignment
shall not require the consent of Lender, so long as, in the case of (i) and
(ii) above, Lender has received evidence that the assignee (or a Person) meets
the Assignment Requirements (a “Qualified Assignee”).  The lease entered into by the Qualified
Assignee with Borrower shall have substantially the same terms as the Operating
Lease, (except for such provisions which by their terms are not applicable to
such Property being assigned) including, but not limited to, the same remaining
lease term, rent escalations, covenants, escrows and reserves, financial reporting
requirements, etc., with a rental rate equal to or greater than the Determined
Minimum Rent (a “Qualified Assignee Lease”). 
In connection with such assignment and release, the Operating Lease
shall be amended to reflect the release of such property and the monthly rental
rate under such Operating Lease shall be reduced as provided in the Operating
Lease; provided, however, that the following shall not constitute an assignment
of the Operating Lease: (1) a transfer to any entity into which or with which
Tenant, its successors or assigns, is merged or consolidated, in accordance
with the applicable statutory provisions of merger or consolidation of
entities, so long as the liabilities of the entities participating in such
merger or consolidation are assumed by the entity surviving such merger or
created by such consolidation, (2) a sale of substantially all of the stock of
Operating Tenant,  (3) a sale of
substantially all of the assets of Operating Tenant to a single entity that
expressly assumes the Operating Lease, (4) a transfer of Tenant’s entire
interest in this Lease to any entity in connection with intercompany corporate
transfers whose ownership is controlled by Tenant or Tenant’s parent or
ultimate parent; or (5) a transfer of Tenant’s entire interest in this Lease to
any entity which has the power to direct Tenant’s management and operation, or
any entity whose management and operation is controlled by Tenant or Tenant’s
parent or ultimate parent is under common control with Tenant or Tenant’s parent
or ultimate parent; (6) a transfer of Tenant’s entire interest in this Lease to
any entity, a majority of whose voting rights are owned by Tenant or Tenant’s
parent or ultimate parent; or (7) a similar transaction to those described in (1)
through (6) above.  With respect to each
of the transactions described in items (4), (5), (6) and a similar intercompany
transaction, described above in this Section 5.1.17(b), Tenant shall remain
liable under the Lease.  With respect to
the transactions described in items (1), (2), (3) and a similar corporate
transaction described above in this Section 5.1.17(b), Tenant’s obligations
under the Lease shall terminate entirely, and Tenant shall be released of any
liability under the Lease, except for the liabilities of Tenant which accrued
prior to the date of such transaction.

 

(c)           In addition, subject to the Square Footage Limitation and
the other provisions hereof, Borrower may allow Operating Tenant the free right
to sublet any portion of the

 

76

 

Properties and any such subletting shall not require the consent of
Lender.  Any such subletting shall in no
way relieve Operating Tenant of its obligations under the Operating Lease.  Lender shall execute and deliver a subordination
and non-disturbance agreements on a form substantially in the form attached
hereto as Exhibit D if (i) the rent under the sublease is a rental rate
equal to or greater than the Determined Minimum Rent and all other terms of the
sublease were negotiated on an arm’s length basis, (ii) the terms of the
sublease shall have substantially the same terms as the Operating Lease,
including, but not limited to, the same remaining lease term, rent escalations,
covenants, escrows and reserves, financial reporting requirements, etc. (except
for such provisions which by their terms are not applicable to such Property
being sublet), (iii) the subtenant (or person that guarantees the obligations
of a subtenant) is a Qualified Subtenant, and (iv) the sublease contains no
other material provisions that (I) benefit the subtenant and are unusual for a
market sublease, and (II) are materially adverse to a landlord.  For avoidance of doubt, the payment by
Operating Tenant to a subtenant of a tenant allowance at the execution of the
sublease shall not be considered unusual.

 

(d)           Borrower (i) shall observe and perform all the obligations
imposed upon the landlord under the Leases and shall not do or permit to be
done anything to impair the value of such Leases as security for the Debt; (ii)
shall promptly send copies to Lender of all notices of default which Borrower
shall receive under the Leases; (iii) shall enforce all of the material terms,
covenants and conditions contained in the Leases upon the part of the
applicable Tenant to be observed or performed; (iv) shall not collect any of
the Rents more than one (1) month in advance; (v) shall not execute any other
assignment of the landlord’s interest in the Leases or the Rents; and (vi)
other than with respect to assignments and subleases in accordance with the
terms of Section 5.1.1.7 (b) and (c) hereof, shall not consent to any
assignment of or subletting under any Lease not in accordance with its terms,
without the prior written consent of Lender, but, other than an expressly
provided herein, the obligations and liabilities of the applicable Tenant under
the applicable Lease shall not be reduced or modified as a result of such
assignment or sublease.

 

5.1.18      Management Agreement.

 

There is no Management
Agreement in effect with respect to the Properties.  Borrower shall not enter into any Management
Agreement without the prior written consent of Lender.

 

5.1.19      Environmental Covenants.

 

(a)           Borrower covenants and agrees that so long as the Loan is
outstanding (i) all uses and operations on or of the Properties, whether by
Borrower or any other Person, shall be in compliance in all material respects
with all Environmental Laws and permits issued pursuant thereto; (ii) unless
Borrower or Tenant is diligently pursuing remediation in accordance with the
notice required to be delivered pursuant to Section 5.1.19(a)(ix) hereof, there
shall be no Releases of Hazardous Materials in, on, under or from any of the
Properties; (iii) there shall be no Hazardous Materials in, on, or under any of
the Properties, except those that are both (A) in compliance with all
Environmental Laws and with permits issued pursuant thereto, if and to the
extent required, and (B) (1) in amounts not in excess of that necessary to
operate the applicable Individual Property or (2) fully disclosed to and
approved by Lender in writing; (iv) Borrower shall keep (or cause to be kept)
the Properties free and clear of all liens and other encumbrances

 

77

 

imposed pursuant to any Environmental Law, whether due to any act or
omission of Borrower or any other Person (the “Environmental Liens”); (v)
Borrower shall, at its sole cost and expense, fully and expeditiously cooperate
in all activities pursuant to paragraph (b) below, including but not limited to
providing all relevant information and making knowledgeable persons available
for interviews; (vi) Borrower shall, at its sole cost and expense, perform or
cause to be performed any environmental site assessment or other investigation
of environmental conditions in connection with any of the Properties, pursuant
to any reasonable written request of Lender, upon Lender’s reasonable belief
that an Individual Property is not in full compliance with all Environmental
Laws, and share with Lender the reports and other results thereof, and Lender
and other Indemnified Parties shall be entitled to rely on such reports and
other results thereof; (vii) Borrower shall, at its sole cost and expense,
comply or cause compliance with all reasonable written requests of Lender to
(A) reasonably effectuate remediation of any Hazardous Materials in, on, under
or from any Individual Property; and (B) comply with any Environmental Law;
(viii) Borrower shall not knowingly permit any Tenant or other user of any of
the Properties to violate any Environmental Law; and (ix) Borrower shall
immediately notify Lender in writing after it has become aware of (A) any
presence or Release or threatened Releases of Hazardous Materials in, on,
under, from or migrating towards any of the Properties; (B) any non-compliance
with any Environmental Laws related in any way to any of the Properties; (C)
any actual or potential Environmental Lien; (D) any required or proposed
remediation of environmental conditions relating to any of the Properties; and
(E) any written or oral notice or other communication of which Borrower becomes
aware from any source whatsoever (including but not limited to a Governmental
Authority) relating in any way to Hazardous Materials in violation of
Environmental Laws.

 

(b)           Lender and any other Person designated by Lender,
including but not limited to any representative of a Governmental Authority,
and any environmental consultant, and any receiver appointed by any court of
competent jurisdiction, shall have the right, but not the obligation, to enter
upon any Individual Property at all reasonable times to assess any and all
aspects of the environmental condition of any Individual Property and its use,
including but not limited to conducting any environmental assessment or audit
(the scope of which shall be determined in Lender’s sole and absolute
discretion) and taking samples of soil, groundwater or other water, air, or
building materials, and conducting other invasive testing.  Borrower shall cooperate with and provide
access to Lender and any such Person or entity designated by Lender.

 

5.1.20      Alterations.

 

Borrower may permit
Operating Tenant to make alterations to the Properties provided (i) such
alterations are performed in compliance with the terms of the Leases, (ii)
Borrower gives Lender prior notice of any material alterations and (iii) such
alterations do not materially reduce the value of the Properties or impair the
safety or structural integrity of the buildings.  Structural alterations made to the Properties
shall not exceed $2,000,000.00 for each Individual Property, with such amount
increased each year in accordance with the CPI Index.  Any structural repairs in excess of the above
amounts shall require Lender’s prior written consent.  Excluding alterations required as a result of
casualty or condemnation, or required to comply with Legal Requirements, the
maximum amount of structural and non-structural construction that is incomplete
or not fully paid for by Operating Tenant at any one time shall not exceed $30,000,000.00
with such amount increased each year in accordance with the CPI Index.  Upon

 

78

 

completion of any
alterations, Borrower shall promptly provide Lender with (a) an architect’s
certificate certifying the alterations to have been completed in conformity
with the plans and specifications (if the alterations are of such a nature as
would require the issuance of such a certificate from the architect); (b) a
certificate of occupancy (if the alterations are of such a nature as would
require the issuance of a certificate of occupancy under applicable law); and
(c) any other documents or information reasonably requested by Lender.  Borrower shall use commercially reasonable
efforts to cause Operating Tenant to keep the Properties free from any Liens
arising out of any work performed on, or materials furnished to, the
Properties.

 

5.1.21      The Ground Lease.

 

With respect to each Ground
Lease,

 

(a)           Borrower shall (i) pay (or cause to be paid) all rents,
additional rents and other sums required to be paid by Borrower, as tenant
under and pursuant to the provisions of each Ground Lease, (ii) diligently
perform and observe (or cause to be diligently performed and observed) all of
the material terms, covenants and conditions of each Ground Lease on the part
of Borrower, as tenant thereunder, (iii) promptly notify Lender of the giving
of any notice by the Fee Owner under the applicable Ground Lease to Borrower of
any default by Borrower, as tenant thereunder, and deliver to Lender a true
copy of each such notice within five (5) Business Days of receipt and (iv)
promptly notify Lender of any bankruptcy, reorganization or insolvency of the
Fee Owner under the applicable Ground Lease or of any notice thereof, and
deliver to Lender a true copy of such notice within five (5) Business Days of
Borrower’s receipt, together with copies of all notices, pleadings, schedules
and similar matters received by Borrower in connection with such bankruptcy,
reorganization or insolvency within five (5) Business Days after receipt.  Borrower shall not, without the prior consent
of Lender, (x) subject to Section 2.7 hereof, surrender the leasehold
estate created by the applicable Ground Lease or terminate or cancel any Ground
Lease or materially modify, change, supplement, alter or amend any Ground
Lease, either orally or in writing, other than to extend the Ground Lease term
as contemplated under the terms thereunder, or (y) consent to, acquiesce in, or
fail to object to, any attempt by any Fee Owner, as debtor in possession or by
a trustee for such Fee Owner,  to sell or
transfer the Fee Estate with respect to any Ground Lease free and clear of the
Ground Lease under section 363(f) of the Bankruptcy Code or otherwise.  Borrower shall object to any such attempt by
such Fee Owner, as debtor in possession or by a trustee for such Fee Owner, to
sell or transfer the Fee Estate with respect to any Ground Lease free and clear
of the Ground Lease under section 363(f) of the Bankruptcy Code or otherwise,
and in such event shall affirmatively assert and pursue its right to adequate
protection under section 363(e) of the Bankruptcy Code.  Borrower hereby assigns to Lender all of its
rights under Section 363 of the Bankruptcy Code to consent or object to any
sale or transfer of such Fee Estate free and clear of the Ground Lease, and
grants to Lender the right to object to any such  sale or transfer on behalf of Borrower, and
Borrower shall not contest any pleadings, motions documents or other actions
filed or taken on Lender’s or Borrower’s behalf by Lender in the event that any
Fee Owner, as debtor in possession or by a trustee for such Fee Owner, attempts
to sell or transfer the Fee Estate with respect to any Ground Lease free and clear
of the Ground Lease under section 363(f) of the Bankruptcy Code or otherwise.

 

79

 

(b)           If Borrower (or if Operating Tenant, at Borrower’s
direction under the Operating Lease) shall default in the performance or
observance of any term, covenant or condition of any Ground Lease on the part
of Borrower, as tenant thereunder, and shall fail to cure the same prior to the
expiration of any applicable cure period provided thereunder, 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 of the terms,
covenants and conditions of such Ground Lease on the part of Borrower to be
performed or observed on behalf of Borrower, to the end that the rights of
Borrower in, to and under such Ground Lease shall be kept unimpaired and free
from default.  If the landlord under the
applicable Ground Lease shall deliver to Lender a copy of any notice of default
under such Ground Lease, such notice shall constitute full protection to Lender
for any action taken or omitted to be taken by Lender, in good faith, in
reliance thereon.  Upon the occurrence
and during the continuance of an Event of Default, Borrower shall exercise each
individual option, if any, to extend or renew the term of each Ground Lease
upon demand by Lender made at any time within one (1) year prior to the last
day upon which any such option may be exercised, and, upon the occurrence and
during the continuance of an Event of Default, 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.

 

(c)           Notwithstanding anything contained in any Ground Lease to
the contrary, Borrower shall not further sublet any portion of the related
Individual Property (other than as permitted pursuant to Section 5.1.17 hereof)
without prior written consent of Lender. 
Each sublease of a Ground Lease hereafter made shall provide that, (a)
in the event of the termination of the Ground Lease, in the event that Lender
shall enter into a new lease with the applicable Fee Owner, the sublease shall
not terminate or be terminable by the lessee thereunder; (b) in the event of
any action for the foreclosure of the Security Instrument with respect to the
related Individual Property, the sublease shall not terminate or be terminable
by the lessee thereunder by reason of the termination of the Ground Lease
unless such lessee is specifically named and joined in any such action and
unless a judgment is obtained therein against such lessee or unless Lender does
not enter into a new lease with the applicable Fee Owner; and (c) in the event
that the Ground Lease is terminated as aforesaid, the lessee under the sublease
shall attorn to the lessor under the Ground Lease or to the purchaser at the
sale of the related Individual Property on such foreclosure, as the case may
be.  In the event that any portion of
such Individual Property shall be sublet pursuant to the terms of this
subsection, such sublease shall be deemed to be included in the Individual
Property.

 

5.1.22      Intentionally Omitted.

 

5.1.23      OFAC.

 

At all times throughout the
term of the Loan, Borrower, Guarantor, Indemnitor and their respective
Affiliates shall be in full compliance with all applicable orders, rules,
regulations and recommendations of The Office of Foreign Assets Control of the
U.S. Department of the Treasury.

 

80

 

Section
5.2            Negative Covenants.

 

From the date hereof until
payment and performance in full of all obligations of Borrower under the Loan
Documents or the earlier release of the Liens of all Security Instruments
encumbering the Properties in accordance with the terms of this Agreement and
the other Loan Documents, Borrower covenants and agrees with Lender that it
will not do, directly or indirectly, any of the following:

 

5.2.1        Liens.

 

Borrower shall not create,
incur, assume or suffer to exist any Lien on any portion of any Individual
Property or permit any such action to be taken, except for Permitted
Encumbrances.

 

5.2.2        Dissolution.

 

Borrower shall not (a)
engage in any dissolution, liquidation or consolidation or merger with or into
any other business entity, (b) transfer, lease or sell, in one transaction or
any combination of transactions, the assets or all or substantially all of the
properties or assets of Borrower except to the extent expressly permitted by
the Loan Documents, (c) except as expressly permitted under the Loan Documents,
modify, amend, waive or terminate its organizational documents or its
qualification and good standing in any jurisdiction where it is required to be
so qualified or (d) cause the Principal to (i) dissolve, wind up or liquidate
or take any action, or omit to take an action, as a result of which the
Principal would be dissolved, wound up or liquidated in whole or in part, or
(ii) except as expressly permitted under the Loan Documents, amend, modify,
waive or terminate the certificate of incorporation, bylaws or similar
organizational documents of the Principal, in each case, without obtaining the
prior written consent of Lender.

 

5.2.3        Change In Business.

 

Borrower shall not enter
into any line of business other than the ownership, acquisition, development,
operation, leasing and management of the Properties (including providing
services in connection therewith), or make any material change in the scope or
nature of its business objectives, purposes or operations or undertake or
participate in activities other than the continuance of its present business.

 

5.2.4        Debt Cancellation.

 

Borrower shall not cancel or
otherwise forgive or release any material claim or debt owed to Borrower by any
Person, except for adequate consideration and in the ordinary course of
Borrower’s business.

 

5.2.5        Zoning.

 

Except as provided elsewhere
in this Agreement regarding, among other things, Out-Parcels, Borrower shall
not, and shall not permit any Affiliate to, initiate or consent to any zoning
reclassification of any portion of any Individual Property or seek any variance
under any existing zoning ordinance or use or permit the use of any portion of
any Individual Property in any manner that could result in such use becoming a
non-conforming use under any zoning ordinance or any other Applicable Law,
without the prior written consent of Lender.

 

81

 

5.2.6        No Joint Assessment.

 

Borrower shall not suffer,
permit or initiate the joint assessment of any Individual Property with (a) any
other real property constituting a tax lot separate from such Individual
Property, or (b) any portion of such Individual 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 such Individual Property.

 

5.2.7        Name, Identity, Structure, or Principal Place
of Business.

 

Borrower shall not change
its name, identity (including its trade name or names), or  principal place of business set forth in the
introductory paragraph of this Agreement, without, in each case, first giving
Lender thirty (30) days prior written notice. 
Borrower shall not change its corporate, partnership or other structure,
or the place of its organization as set forth in Section 4.1.34, without, in
each case, the consent of Lender.  Upon
Lender’s request, Borrower shall execute and deliver additional financing
statements, security agreements and other instruments which may be necessary to
effectively evidence or perfect Lender’s security interest in the Property as a
result of such change of principal place of business or place of organization.

 

5.2.8        ERISA.

 

(a)           During the term of the Loan or of any obligation or right
hereunder, Borrower shall not be a Plan and none of the assets of Borrower
shall constitute Plan Assets.

 

(b)           Borrower further covenants and agrees to deliver to Lender
such certifications or other evidence from time to time throughout the term of
the Loan, as requested by Lender in its sole discretion, and represents and
covenants that (A) Borrower is not and does not maintain an “employee benefit
plan” as defined in Section 3(3) of ERISA, which is subject to Title I of
ERISA, or a “governmental plan” within the meaning of Section 3(32) of ERISA,
(B) Borrower is not subject to State statutes regulating investments and
fiduciary obligations with respect to governmental plans and (C) Borrower is
not be a Plan and none of the assets of Borrower constitute Plan Assets.

 

5.2.9        Affiliate Transactions.

 

Borrower shall not enter
into, or be a party to, any transaction with an Affiliate of Borrower,
Principal or any of the partners of Borrower or Principal except as permitted
hereunder or in the ordinary course of business and on terms no less favorable
to Borrower or such Affiliate than would be obtained in a comparable arm’s-length
transaction with an unrelated third party.

 

5.2.10      Transfers.

 

(a)           Borrower shall not sell, convey, mortgage, grant, bargain,
encumber, pledge, assign, grant options with respect to, or otherwise transfer
or dispose of (directly or indirectly, voluntarily or involuntarily, by
operation of law or otherwise, and whether or not for consideration or of
record) any Individual Property or any part thereof or any

 

82

 

legal or beneficial interest therein or permit a Sale or Pledge of an
equity interest in any Restricted Party (collectively, a “Transfer”), other
than pursuant to Leases of space in the Improvements to Tenants in accordance
with the provisions of Section 5.1.17 hereof or a release of an Individual
Property or an Out-Parcel in accordance with the provisions of Section 2.5
hereof, or a substitution of an Individual Property in accordance with the
provisions of Section 2.6 hereof, without (i) the prior written consent of
Lender and (ii) if a Securitization has occurred, delivery to Lender of written
confirmation from the Rating Agencies that the Transfer will not result in the
downgrade, withdrawal or qualification of the then current ratings assigned to
any Securities or the proposed rating of any Securities.

 

(b)           A Transfer shall include, but not be limited to: (i) an installment
sales agreement wherein Borrower agrees to sell one or more Individual
Properties or any part thereof for a price to be paid in installments; (ii) an
agreement by Borrower leasing all or a substantial part of any Individual
Property for other than actual occupancy by a space Tenant thereunder or a
sale, assignment or other transfer of, or the grant of a security interest in,
Borrower’s right, title and interest in and to any Leases or any Rents; (iii)
if a Restricted Party is a corporation, any merger, consolidation or Sale or
Pledge of such corporation’s stock or the creation or issuance of new stock;
(iv) if a Restricted Party is a limited or general partnership or joint
venture, any merger or consolidation or the change, removal, resignation or
addition of a general partner or the Sale or Pledge of the partnership interest
of any general partner or any profits or proceeds relating to such partnership
interest, or the Sale or Pledge of limited partnership interests or any profits
or proceeds relating to such limited partnership interests or the creation or
issuance of new limited partnership interests; (v) if a Restricted Party is a
limited liability company, any merger or consolidation or the change, removal,
resignation or addition of a managing member or non-member manager (or if no
managing member, any member) or the Sale or Pledge of the membership interest
of a managing member (or if no managing member, any member) or any profits or
proceeds relating to such membership interest, or the Sale or Pledge of
non-managing membership interests or the creation or issuance of new
non-managing membership interests; (vi) if a Restricted Party is a trust or
nominee trust, any merger, consolidation or the Sale or Pledge of the legal or
beneficial interest in a Restricted Party or the creation or issuance of new
legal or beneficial interests; or (vii) the removal or the resignation of the
managing agent (including, without limitation, an Affiliated Manager) other
than in accordance with Section 5.1.18 hereof.

 

(c)           Notwithstanding the provisions of Sections 5.2.10(a) and (b),
the following transfers shall not be deemed to be a Transfer: (i) a transfer by
devise or descent or by operation of law upon the death of a member, partner or
shareholder of a Restricted Party or a Restricted Party itself, (ii) the Sale
or Pledge, in one or a series of transactions, of not more than forty-nine
percent (49%) of the equity interests in a Restricted Party, (iii) the Sale or
Pledge, in one or a series of transactions, of not more than forty-nine percent
(49%) of the limited partnership interests or non-managing membership interests
(as the case may be) in a Restricted Party and (iv) pledges and hypothecations
(but not the foreclosure of such pledges or hypothecations) of more than
forty-nine percent (49%) of the indirect equity interests in Borrower to an
Institutional Lender provided that such pledges or hypothecations are in
connection with a short term

 

83

 

financing with Guarantor (I) secured by, directly or indirectly, all or
substantially all of the equity interests owned by Guarantor and (II) with an
term of not more than five (5) months, and as a condition to each such transfer
in this subsection (c), Lender shall receive not less than twenty (20) days
prior written notice of such proposed transfer and no such transfers shall
result in the change of voting control in Borrower or Principal.

 

(d)           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 in violation of
this Section 5.2.10.  This provision
shall apply to every Transfer regardless of whether voluntary or not, or
whether or not Lender has consented to any previous Transfer.  Notwithstanding anything to the contrary
contained in this Section 5.2.10, (a) no transfer (whether or not such transfer
shall constitute a Transfer) shall be made to any Prohibited Person, (b) in the
event of any transfer (whether or not such transfer shall constitute a
Transfer), results in any Person and its Affiliates owning in excess of
forty-nine percent (49%) of the ownership interest in a Borrower or Principal,
Borrower shall provide to Lender, not less than thirty (30) days prior to such
transfer, the name and identity of each proposed transferee, together with the
names of its controlling principals, the social security number or employee
identification number of such transferee and controlling principals, and such
transferee’s and controlling principal’s home address or principal place of
business, and home or business telephone number, and (c) in the event any
transfer (whether or not such transfer shall constitute a Transfer) results in
any Person and its Affiliates owning in excess of forty-nine percent (49%) of
the ownership interest in a Restricted Party, 
Borrower shall, prior to such transfer, deliver an updated Insolvency
Opinion to Lender, which opinion shall be in form, scope and substance acceptable
in all respects to Lender and, if a Securitization has occurred, the Rating
Agencies.

 

(e)           Notwithstanding the foregoing, a pledge of the indirect
equity interests in a Restricted Party by Sponsor to a Qualified Investor shall
be permitted in connection with a line of credit, revolving credit facility or
other corporate facility secured by such a pledge (a “Secured Line of Credit”),
provided that (i) no Event of Default has occurred and is continuing (ii) any
such Secured Line of Credit is secured by all, or substantially all, of the
equity interests owned by Sponsor; and (iii) Lender shall have received at
least thirty (30) days prior written notice of the proposed Secured Line of
Credit.

 

5.2.11      Assumption

 

Notwithstanding anything to
the contrary contained in Section 5.2.10 of this Agreement, Lender shall not
unreasonably withhold its consent to a one-time sale, assignment, or other
transfer of the Properties, in their entirety, provided that (a) Lender
receives thirty (30) days prior written notice of such transfer, (b) no Event
of Default has occurred and is continuing and (c) upon the satisfaction (in the
reasonable determination of Lender) of the following conditions:

 

(a)           Borrower shall have paid to Lender, concurrently with the
closing of such transfer, (i) a non-refundable assumption fee in an amount
equal to one percent (1.0%) of the then outstanding principal balance of the
Note, and (ii) all out-of-pocket costs and

 

84

 

expenses, including reasonable attorneys’ fees, incurred by Lender in
connection with the transfer;

 

(b)           The proposed transferee (“Transferee”) shall be a
Qualified Transferee or wholly owned and controlled by a Qualified Transferee;

 

(c)           Transferee shall assume all of the obligations of Borrower
under the Note, the Security Instruments, this Agreement and the other Loan
Documents in a manner satisfactory to Lender in all respects, including,
without limitation, by entering into an assumption agreement in form and
substance satisfactory to Lender;

 

(d)           Borrower and Transferee, without any cost to Lender, shall
furnish any information requested by Lender for the preparation of, and shall
authorize Lender to file, new financing statements and financing statement
amendments and other documents to the fullest extent permitted by Applicable
Law, and shall execute any additional documents reasonably requested by Lender;

 

(e)           Borrower
shall have delivered to Lender, without any cost or expense to Lender, such
endorsements to Lender’s Title Insurance Policy insuring that fee simple and/or
leasehold title to the Properties, as applicable, is vested in Transferee
(subject to Permitted Encumbrances), hazard insurance endorsements or
certificates and other similar materials as Lender may deem necessary at the
time of the transfer, all in form and substance reasonably satisfactory to
Lender;

 

(f)            Transferee shall have furnished to Lender all appropriate
papers evidencing Transferee’s organization and good standing, and the
qualification of the signers to execute the assumption of the Debt, which
papers shall include certified copies of all documents relating to the
organization and formation of Transferee and of the entities, if any, which are
partners or members of Transferee. 
Transferee and such constituent partners, members or shareholders of
Transferee (as the case may be), as Lender shall require, shall comply with the
covenants set forth in Section 4.1.35 hereof;

 

(g)           Transferee shall furnish an opinion of counsel
satisfactory to Lender and its counsel (1) that Transferee’s formation
documents provide for the matters described in subparagraph (f) above, (2) that
the assumption of the Debt has been duly authorized, executed and delivered,
and that the Note, the Security Instruments, this Agreement, the assumption
agreement and the other Loan Documents are valid, binding and enforceable
against Transferee in accordance with their terms, (3) that Transferee and any
entity which is a controlling stockholder, member or general partner of Transferee,
have been duly organized, and are in existence and good standing, (4) with
respect to the substantive non-consolidation of Transferee and its constituent
entities (partners, members or shareholders)and (5) with respect to such other
matters as Lender may reasonably request;

 

(h)           All of the Operating Leases and all of the Qualified
Assignee Leases shall remain in full force and effect during and after the
completion of such transfer without abatement of rent; and

 

85

 

(i)            The Property shall be managed by a Qualified Manager
following such transfer.

 

VI.           INSURANCE;
CASUALTY; CONDEMNATION; REQUIRED REPAIRS

 

Section
6.1            Insurance.

 

(a)           Borrower shall obtain and maintain, or cause to be
maintained, Policies for Borrower and the Properties providing at least the
following coverages:

 

(i)               comprehensive all risk insurance including a
$100,000,000 per occurrence
sub-limit, with no aggregate for the peril of wind, (named storms), on the
Improvements and the Personal Property, in each case (A) in an amount equal to
100% of the “Full Replacement Cost,” which for purposes of this Agreement shall
mean actual replacement value (exclusive of costs of excavations, foundations,
underground utilities and footings) with a waiver of depreciation, (B)
containing an agreed amount endorsement with respect to the Improvements and
Personal Property waiving all co-insurance provisions; (C) providing for no
deductible in excess of (I) $100,000 or (II) in the event that the Insurance Deductible
Letter of Credit is in full force and effect, $500,000 ; and (D) providing
coverage for contingent liability from Operation of Building Laws, Demolition
Costs and Increased Cost of Construction Endorsements together with an “Ordinance
or Law Coverage” or “Enforcement” endorsement if any of the Improvements or the
use of each Individual Property shall at any time constitute legal
non-conforming structures or uses.  The
Full Replacement Cost shall be redetermined from time to time (but not more
frequently than once in any twenty-four (24) calendar months) at the request of
Lender by an appraiser or contractor designated and paid by Borrower and
approved by Lender, or by an engineer or appraiser in the regular employ of the
insurer.  After the first appraisal,
additional appraisals may be based on construction cost indices customarily
employed in the trade.  No omission on
the part of Lender to request any such ascertainment shall relieve Borrower of
any of its obligations under this Subsection;

 

(ii)              commercial general liability insurance against claims
for personal injury, bodily injury, death or property damage occurring upon, in
or about each Individual Property, such insurance (A) to be on the so-called “occurrence”
form with a combined single limit of not less than $1,000,000.00 pre occurrence
and $2,000,000 in the aggregate; (B) to continue at not less than the aforesaid
limit until required to be changed by Lender in writing by reason of changed
economic conditions making such protection inadequate; and (C) to cover at
least the following hazards: (1) premises and operations; (2) products and
completed operations on an “if any” basis; (3) independent contractors; (4)
blanket contractual liability for all written and oral contracts; and (5)
contractual liability covering the indemnities contained in Article 10 of the
Security Instruments to the
extent the same is available. The deductible for the coverage required pursuant
to this subsection (ii) shall not exceed $250,000;

 

86

 

(iii)             business interruption/loss of rents insurance (A) with
loss payable to Lender as mortgagee and loss payee; (B) covering all risks
required to be covered by the insurance provided for in Section 6.1(a)(i); (C)
in an amount equal to 100% of the projected gross income from each Individual
Property (on an actual loss sustained basis) for a period continuing until the
Restoration of the Individual Property is completed; the amount of such
business interruption/loss of rents insurance shall be determined prior to the
Closing Date and at least once each year thereafter based on the greatest of:
(x) Borrower’s reasonable estimate of the gross income from each Individual
Property and (y) the highest gross income received during the term of the Note
for any full calendar year prior to the date the amount of such insurance is
being determined, in each case for the succeeding twenty-four (24) month period
and (D) containing an extended period of indemnity endorsement which provides
that after the physical loss to the Improvements and the Personal Property has
been repaired, the continued loss of income will be insured until such income
either returns to the same level it was at prior to the loss, or the expiration
of six (6) months from the date that the applicable Individual Property is
repaired or replaced and operations are resumed, whichever first occurs, and
notwithstanding that the policy may expire prior to the end of such period; All
insurance proceeds payable to Lender pursuant to this Section 6.1(a)(iii) shall
be held by Lender and shall be applied to the obligations secured hereunder
from time to time due and payable hereunder and under the Note and this
Agreement; provided, however, that nothing herein contained shall be deemed to relieve
Borrower of its obligations to pay the obligations secured hereunder on the
respective dates of payment provided for in the Note and this Agreement except
to the extent such amounts are actually paid out of the proceeds of such
business interruption/loss of rents insurance.

 

(iv)             at all times during which structural construction,
repairs or alterations are being made with respect to the Improvements (A)
owner’s contingent or protective liability insurance covering claims not
covered by or under the terms or provisions of the insurance provided for in
Section 6.1(c)(ii); and (B) the insurance provided for in Section 6.1(a)(i)
shall be written in a so-called builder’s risk completed value or similar
property form (1) on a non-reporting basis, (2) against all risks insured
against pursuant to Section 6.1(a)(i), (3) shall include permission to occupy
each Individual Property, and (4) shall contain an agreed amount endorsement
waiving co-insurance provisions;

 

(v)              workers’ compensation, subject to the statutory limits
of the State in which each Individual Property is located, and employer’s
liability insurance with a limit of at least $1,000,000.00 per accident and per
disease per employee, and $1,000,000.00 for disease aggregate in respect of any
work or operations on or about each Individual Property, or in connection with
such Individual Property or its operation (if applicable);

 

(vi)             comprehensive boiler and machinery insurance, if
applicable, in amounts as shall be reasonably required by Lender on terms
consistent with the commercial property insurance policy required under Section
6.1(a)(i);

 

87

 

(vii)            if any portion of the Improvements is at any time located
in an area identified by the Secretary of Housing and Urban Development or any
successor thereto as an area having special flood hazards pursuant to the
National Flood Insurance Act of 1968, the Flood Disaster Protection Act of 1973
or the National Flood Insurance Reform Act of 1994, as each may be amended, or
any successor law (the “Flood Insurance Acts”), flood hazard insurance of the
following types and in the following amounts (A) coverage under Policies issued
pursuant to the Flood Insurance Acts (the “Flood Insurance Policies”) in an
amount equal to the maximum limit of coverage available for the applicable
Individual Property under the Flood Insurance Acts, subject only to customary
deductibles under such Policies and (B) coverage under supplemental private
Policies in an amount, which when added to the coverage provided under the
Flood Act Policies with respect to an Individual Property, is not less than the
Allocated Loan Amount for such Individual Property;

 

(viii)           earthquake for locations with
Probable Maximum Loss percentages (PML%) of 20 or greater, and, if required by
Lender, sinkhole and mine subsidence insurance in amounts equal to one times
(1x) the probable maximum loss of each Individual Property as determined by
Lender in its sole discretion and in form and substance satisfactory to Lender,
provided that the insurance pursuant to this Section 6.1(a)(viii) hereof shall
be on terms consistent with the all risk insurance policy required under
Section 6.1(a)(i) hereof;

 

(ix)             umbrella liability insurance in an amount not less than
Seventy-Five Million and 00/100 Dollars ($75,000,000.00) per occurrence on
terms consistent with the commercial general liability insurance policy
required under Section 6.1(a)(ii) hereof;

 

(x)              such other insurance and in such amounts as is required
under the Operating Leases, the Qualified Assignee Leases or as Lender from
time to time may reasonably request against such other insurable hazards which
at the time are commonly insured against for property similar to each
Individual Property located in or around the region in which the each
Individual Property is located.

 

(b)           All insurance provided shall be obtained under valid and
enforceable policies (the “Policies” or in the singular, the “Policy”), and
shall be subject to the approval of Lender as to insurance companies, policy
limits and any sub-limits thereof, forms (including exclusions and exceptions),
deductibles, loss payees and insureds. The insurance companies must be
approved, authorized or licensed to provide insurance in the state in which the
Property is located and have a rating of “A” or better for financial strength
claims paying ability assigned by Moody’s Investors Service, Inc. (if Moody’s
Investors Service, Inc. provides a rating for the insurer) and Standard &
Poor’s Rating Group (“S&P”), provided that if any insurance required is
provided by a syndicate of insurers, the insurers with respect to such
insurance shall be acceptable if:   (i)
the first layer of coverage under such insurance shall be provided by carriers
with a minimum financial strength rating from S&P of “A” or better; (ii)
sixty percent (60%) (seventy-five percent (75%) if there four or fewer members
in the syndicate) of the aggregate limits

 

88

 

under such Policies must be provided by carriers with a minimum
financial strength rating from S&P of “A” or better and (iii) the financial
strength rating from S&P for each carrier in the syndicate shall have a
financial strength rating from S&P of at least “BBB”(each such insurer
shall be referred to below as a “Qualified Insurer”).  Borrower
will be required to maintain insurance against terrorism, terrorist acts or
similar acts of sabotage (“Terrorism Insurance”) with coverage amounts of not
less than Two Hundred Million and 00/100 Dollars ($200,000,000.00) (the “Terrorism
Insurance Required Amount”). 
Notwithstanding the foregoing sentence, Borrower shall not be obligated
to expend more than $150,000.00 in any fiscal year on Insurance Premiums for
Terrorism Insurance (the “Terrorism Insurance Cap”), increased annually based
on increases in the CPI Index, and if the cost of the Terrorism Insurance
Required Amount exceeds the Terrorism Insurance Cap, Borrower shall purchase
the maximum amount of Terrorism Insurance available with funds equal to the
Terrorism Insurance Cap.  Not less
than thirty (30) days prior to the expiration dates of the Policies theretofore
furnished to Lender pursuant to Section 6.1(a), Borrower shall deliver
certified copies of insurance certificates or binders marked “premium paid” or
accompanied by evidence satisfactory to Lender of payment of the premiums due
thereunder (the “Insurance Premiums”).

 

(c)           Intentionally Omitted.

 

(d)           All Policies provided for or contemplated by Section
6.1(a) hereof, except for the Policy referenced in Section 6.1(a)(v), shall
name Lender and Borrower as the insured or additional insured, as their
respective interests may appear, and in the case of property damage, boiler and
machinery, and flood insurance, shall contain a so-called New York standard
non-contributing mortgagee clause in favor of Lender providing that the loss
thereunder shall be payable to Lender as their interests may appear.

 

(e)           All Policies provided for in Section 6.1(a) hereof shall
contain clauses or endorsements to the effect that:

 

(i)               no act or negligence of Borrower, any Tenant, or
anyone acting for Borrower or such Tenant, or failure to comply with the
provisions of any Policy which might otherwise result in a forfeiture of the
insurance or any part thereof, shall in any way affect the validity or
enforceability of the insurance insofar as Lender is concerned;

 

(ii)              the Policy shall not be materially changed (other than
to increase the coverage provided thereby) or cancelled without at least ten
(10) days’ written notice to Lender and any other party named therein as an
insured;

 

(iii)             each Policy shall provide that the issuers thereof shall
give written notice to Lender if the Policy has not been renewed ten (10) days
prior to its expiration; and

 

(iv)             Lender shall not be liable for any Insurance Premiums
thereon or subject to any assessments thereunder.

 

89

 

(f)            Upon Lender’s request, Borrower shall furnish to Lender,
on or before thirty (30) days after the close of each of Borrower’s fiscal
years or if different, the Tenant’s fiscal year, a schedule of insurance
summarizing the insurance maintained in compliance herewith, of the risks
covered by such insurance and of the insurance company or companies which carry
such insurance and, if requested by Lender, verification of the adequacy of
such insurance by an independent insurance broker or appraiser acceptable to
Lender.

 

(g)           If at any time Lender is not in receipt of written
evidence that all insurance required hereunder is in full force and effect,
Lender shall have the right, without prior notice to Borrower (but Lender shall
promptly notify Borrower after taking any such action) to take such action as
Lender deems necessary to protect its interest in the Properties, including,
without limitation, the obtaining of such insurance coverage as Lender in its
sole discretion deems appropriate, and all expenses incurred by Lender in
connection with such action or in obtaining such insurance and keeping it in
effect shall be paid by Borrower to Lender upon demand and until paid shall be
secured by the Security Instruments and shall bear interest at the Default Rate.

 

(h)           In the event of a foreclosure of any of the Security
Instruments, or other transfer of title to any Individual Property in
extinguishment in whole or in part of the Debt all right, title and interest of
Borrower in and to the Policies then in force and all proceeds payable
thereunder shall thereupon vest in the purchaser at such foreclosure or Lender
or other transferee in the event of such other transfer of title.

 

Section
6.2            Casualty.

 

If an Individual Property
shall be damaged or destroyed, in whole or in part, by fire or other casualty
(a “Casualty”), Borrower shall give prompt notice of such damage to Lender and,
subject to Operating Tenant’s right under the Operating Lease to terminate the
Operating Lease as to any Individual Property subject to a “casualty event” under
the terms of the Operating Lease, Borrower shall promptly commence, or cause
commencement, and diligently prosecute or cause prosecution of the completion
of the Restoration of the Individual Property as nearly as possible to the condition
the Individual Property was in immediately prior to such Casualty, with such
alterations as may be reasonably approved by Lender and otherwise in accordance
with Section 6.4.  Borrower shall pay, or
cause to be paid, all costs of such Restoration whether or not such costs are
covered by insurance.  Lender may, but
shall not be obligated to make proof of loss if not made promptly by Borrower
or Operating Tenant.

 

Section
6.3            Condemnation.

 

Borrower shall promptly give
Lender notice of the actual or threatened commencement of any proceeding for
the Condemnation of all or any part of any Individual Property and shall
deliver to Lender copies of any and all papers served in connection with such
proceedings.  Lender may participate in
any such proceedings, and Borrower shall from time to time deliver to Lender
all instruments requested by it to permit such participation.  Borrower shall, at its expense, diligently
prosecute any such proceedings, and shall consult with Lender, its attorneys
and experts, and cooperate with them in the carrying on or defense of any such
proceedings. 

 

90

 

Notwithstanding any taking
by any public or quasi-public authority through Condemnation or otherwise
(including, but not limited to, any transfer made in lieu of or in anticipation
of the exercise of such taking), Borrower shall continue to pay the Debt at the
time and in the manner provided for its payment in the Note and in this
Agreement and the Debt shall not be reduced until any Award shall have been
actually received and applied by Lender, after the deduction of expenses of
collection, to the reduction or discharge of the Debt.  Lender shall not be limited to the interest
paid on the Award by the condemning authority but shall be entitled to receive
out of the Award interest at the rate or rates provided herein or in the
Note.  If any Individual Property or any
portion thereof is taken by a condemning authority, and Tenant has not elected
to terminate the Lease with respect to such Individual Property, Borrower
shall, subject to Operating Tenant’s right under the Operating Lease to
terminate the Operating Lease as to any Individual Property subject to a condemnation
proceeding under the terms of the Operating Lease, Borrower shall promptly
commence, or cause commencement and diligently prosecute or cause prosecution
of the Restoration of the applicable Individual Property and otherwise comply
with the provisions of Section 6.4.  If
any Individual Property is sold, through foreclosure or otherwise, prior to the
receipt by Lender of the Award, Lender shall have the right, whether or not a
deficiency judgment on the Note shall have been sought, recovered or denied, to
receive the Award, or a portion thereof sufficient to pay the Debt.

 

Section
6.4            Restoration.

 

6.4.1        Application to Restoration.

 

If any Casualty covered by
any of the Policies or Condemnation occurs where the Operating Tenant has not
terminated the Operating Lease as to any such Individual Property in accordance
with the provisions of Sections 6.2 and 6.3 above, and if:

 

(i)               in the reasonable judgment of Lender, the affected
Individual Property can be restored before the earlier of (I) at least three
(3) months before the Maturity Date or (II) six (6) months prior to expiration
of the Operating Lease and the applicable Qualified Assignee Leases, and prior
to the expiration of the rental or business interruption insurance with respect
thereto, to the affected Individual Property’s pre-existing condition and
utility as existed immediately prior to such Casualty or Condemnation and to an
economic unit not less valuable and not less useful than the same was
immediately prior to the Casualty or Condemnation, and after such Restoration
such Individual Property will adequately secure the Allocated Loan Amount for
such Individual Property;

 

(ii)              following the Restoration thereof, such Individual
Property will continue to be demised under the Operating Lease and, if
applicable, the Qualified Assignee Leases, and provided such Operating Lease
and, if applicable, the Qualified Assignee Leases are then in full force and
effect and the applicable Operating Tenant and, Qualified Assignee, if
applicable, is not in bankruptcy; and

 

(iii)             no Event of Default shall have occurred and be then
continuing,

 

91

 

then
the Net Proceeds shall be (I) in the event the Net Proceeds are less than the
Restoration Threshold, disbursed to Borrower or (II) in the event the Net
Proceeds are greater than the Restoration Threshold and, during a Lockbox Cash
Flow Sweep Period, less than $3,000,000.00, applied to reimburse Borrower, in
either case, for the cost of Restoration of the affected Individual Property,
in the manner set forth herein.  Borrower
shall commence or cause the commencement of, and diligently prosecute or cause
the diligent prosecution of such Restoration. 
Notwithstanding the foregoing, in no event shall Lender be obligated to
apply such Net Proceeds to reimburse any Borrower for the cost of Restoration
unless, in addition to satisfaction of the foregoing conditions, both (x)
Borrower shall pay or cause to be paid all costs of such Restoration in excess
of the net amount of the Net Proceeds made available pursuant to the terms
hereof; and (y) Lender shall have received evidence reasonably satisfactory to
it that during the period of the Restoration, the aggregate Rents for the
Properties will be at least equal to the sum of the operating expenses for all
Properties and all debt service, reserve and other payments required under the
Loan Documents during such period, as reasonably determined by Lender.

 

6.4.2        Application to Debt

 

(A) During a Lockbox Cash
Flow Sweep Period and in the event the Net Proceeds are greater than or equal
to $3,000,000.00 or (B) if Operating Tenant has terminated the Operating Lease
as to any Individual Property in connection with a casualty event or
condemnation proceeding pursuant to the terms of the Operating Lease, any Net
Proceeds may, at the option of Lender in its discretion, be applied to the
payment of (i) interest on the Note through the end of the Interest Period in
which such payment occurs, (ii) the unpaid principal balance of the Loan and
(iii) other charges due under the Note and/or any of the other Loan Documents.

 

6.4.3        Procedure for Application to Restoration

 

In the event the Net
Proceeds are greater than the Restoration Threshold and, during a Lockbox Cash
Flow Sweep Period, less than $3,000,000.00 and Borrower is entitled to
reimbursement out of the Net Proceeds held by Lender, such Net Proceeds shall
be disbursed from time to time upon Lender being furnished with:

 

(i)               evidence satisfactory to Lender of the estimated cost
of completion of the Restoration,

 

(ii)              prior to the commencement of Restoration, Lender shall have
evidence satisfactory to Lender that determined that all immediately available
funds in addition to the Net Proceeds in Lender’s reasonable judgment are
sufficient to complete the proposed Restoration,

 

(iii)             such architect’s certificates, waivers of lien,
contractor’s sworn statements, title insurance endorsements, bonds, plats of
survey, permits, approvals, licenses and such other documents and items as
Lender may require and approve in Lender’s reasonable discretion, and

 

(iv)             all plans and specifications for such Restoration, such
plans and specifications to be approved by Lender prior to commencement of any
work.

 

92

 

Lender
may, at Borrower’s expense, retain a consultant to review and approve all
requests for disbursements, which approval shall also be a condition precedent
to any disbursement.  No payment made
prior to the final completion of the Restoration shall exceed ninety percent
(90%) of the value of the work performed; funds other than the Net Proceeds
shall be disbursed prior to disbursement of such Net Proceeds; and at all
times, the undisbursed balance of such Net Proceeds then held by Lender,
together with funds deposited for that purpose or irrevocably committed to the
satisfaction of Lender by or on behalf of Borrower for that purpose, shall be
at least sufficient in the reasonable judgment of Lender to pay for the cost of
completion of the Restoration, free and clear of all Liens or claims for Lien.  Provided no Event of Default then exists, any
surplus that remains out of the Insurance Proceeds held by Lender after payment
of such costs of Restoration shall be paid to Borrower.  Any surplus that remains out of the
Condemnation Proceeds received by Lender after payment of such costs of
Restoration shall be retained by Lender and applied to payment of the Debt or
returned to Borrower.

 

VII.         RESERVE
FUNDS

 

Section
7.1            Required Repair
Funds.

 

7.1.1        Deposits.

 

On the Closing Date,
Borrower shall deposit with Lender the amount for each Individual Property set
forth on such Schedule II hereto to perform the Required Repairs for
such Individual Property.  Amounts so
deposited with Lender shall be held by Lender in accordance with Section 7.7
hereof.  Amounts so deposited shall hereinafter
be referred to as Borrower’s “Required Repair Fund.”  Borrower shall perform, or cause to be
performed, the repairs at the Properties, as more particularly set forth on Schedule
II hereto (such repairs hereinafter referred to as “Required Repairs”).  Borrower shall complete, or cause to be
completed, the Required Repairs on or before the required deadline for each
repair as set forth on Schedule II. 
It shall be an Event of Default under this Agreement if (i) Borrower
does not complete or does not cause the completion of the Required Repairs at
each Individual Property as set forth on Schedule II on or before
January 1, 2007, or (ii) Borrower does not satisfy, or cause the satisfaction,
of each condition contained in Section 7.1.2 hereof.  Upon the occurrence of an Event of Default,
Lender, at its option, may withdraw all Required Repair Funds from the Required
Repair Account and Lender may apply such funds either to completion of the
Required Repairs at one or more of the Properties or toward payment of the Debt
in such order, proportion and priority as Lender may determine in its sole
discretion.  Lender’s right to withdraw
and apply Required Repair Funds shall be in addition to all other rights and
remedies provided to Lender under this Agreement and the other Loan Documents.

 

7.1.2        Release of Required Repair Funds.

 

Lender shall disburse to
Borrower the Required Repair Funds from the Required Repair Account from time
to time upon satisfaction by Borrower of each of the following conditions:  (a) Borrower shall submit a written request
for payment to Lender at least ten (10) days prior to the date on which
Borrower requests such payment be made and specifying the Required Repairs to
be paid, (b) on the date such request is received by Lender and on the date
such payment is to be made, no Default or Event of Default shall exist and
remain uncured, (c) Lender shall have

 

93

 

received an Officers’
Certificate (i) stating that all Required Repairs at the applicable Individual
Property to be funded by the requested disbursement have been completed in a good
and workmanlike manner and, to Borrower’s knowledge, in accordance with all
Legal Requirements and Environmental Laws, (ii) identifying each Person that
supplied materials or labor in connection with the Required Repairs performed
at such Individual Property with respect to the reimbursement to be funded by
the requested disbursement, and (iii) stating that each such Person has been
paid in full with respect to the portion of the Required Repairs which is the
subject of the requested disbursement, such Officers’ Certificate to be
accompanied by lien waivers or other evidence of payment satisfactory to
Lender, and (d) at Lender’s option, a title search for such Individual Property
indicating that such Individual Property is free from all Liens, claims and
other encumbrances not previously approved by Lender. Lender shall not be
required to make disbursements from the Required Repair Account unless such
requested disbursement is in an amount greater than $25,000 (or a lesser amount
if the total amount in the Required Repair Account is less than $25,000, in
which case only one disbursement of the amount remaining in the account shall
be made).  Upon the satisfaction of the
foregoing requirements, Lender shall be obligated to make disbursements from
the Required Repair Account with respect to an Individual Property in the
amount allocated for such Individual Property set forth on Schedule II
hereof (even if the cost to complete such work is less than the amount set
forth in Schedule II hereof; provided that Lender shall not be obligated
to make disbursements from the Required Repair Account with respect to an
Individual Property in excess of the amount allocated for such Individual
Property as set forth on Schedule II hereof.

 

Section
7.2            Tax and Insurance
Escrow Fund.

 

(a)           During any Triggering Event Period, Borrower shall pay (or
cause to be paid) to Lender on each Payment Date (i) one-twelfth of the Taxes
(the “Monthly Tax Deposit”) that Lender estimates will be payable during the
next ensuing twelve (12) months in order to accumulate with Lender sufficient
funds to pay all such Taxes at least thirty (30) days prior to their respective
due dates; and (ii) at the option of Lender, if the liability or casualty
Policy maintained by Borrower covering the Properties shall not constitute an
approved blanket or umbrella Policy pursuant to Section 6.1 hereof, or Lender
shall require Borrower to obtain a separate Policy pursuant to Section 6.1
hereof, one-twelfth of the Insurance Premiums (the “Monthly Insurance Premium
Deposit”) that Lender estimates will be payable for the renewal of the coverage
afforded by the Policies upon the expiration thereof in order to accumulate
with Lender sufficient funds to pay all such Insurance Premiums at least thirty
(30) days prior to the expiration of the Policies (said amounts in (i) and (ii)
above hereinafter called the “Tax and Insurance Escrow Fund”).  The Tax and Insurance Escrow Fund and the
payments of interest or principal or both, payable pursuant to the Note and
this Agreement, shall be added together and shall be paid as an aggregate sum
by Borrower to Lender.  Lender will apply
the Tax and Insurance Escrow Fund to payments of Taxes and Insurance Premiums
required to be made by Borrower pursuant to Sections 5.1.12 and 6.1,
respectively, hereof.  In making any
payment relating to the Tax and Insurance Escrow Fund, Lender may do so
according to any bill, statement or estimate procured from the appropriate
public office (with respect to Taxes) or insurer or agent (with respect to
Insurance Premiums), without inquiry into the accuracy of such bill, statement
or estimate or into the validity of any tax, assessment, sale, forfeiture, tax lien
or title or claim thereof.  If the amount
of the Tax and Insurance Escrow Fund shall exceed the amounts due for Taxes and
Insurance Premiums pursuant to Sections 5.1.12 and 6.1, 

 

94

 

respectively, hereof, Lender
shall, in its sole discretion, return any excess to Borrower or credit such
excess against future payments to be made to the Tax and Insurance Escrow
Fund.  In allocating such excess, Lender
may deal with the Person shown on the records of Lender to be the owner of the
Properties.  Any amount remaining in the
Tax and Insurance Escrow Fund after the Debt has been paid in full shall be
returned to Borrower.  If at any time Lender
reasonably determines that the Tax and Insurance Escrow Fund is not or will not
be sufficient to pay Taxes and Insurance Premiums by the dates set forth in (i)
and (ii) above, Lender shall notify Borrower of such determination and Borrower
shall increase its monthly payments to Lender by the amount that Lender
estimates is sufficient to make up the deficiency at least thirty (30) days
prior to delinquency of the Taxes and/or thirty (30) days prior to expiration
of the Policies, as the case may be.

 

(b)           Upon the occurrence of a Triggering Event Termination
Event, upon written request of Borrower, Lender shall disburse all funds
contained in the Tax and Insurance Escrow Fund to Borrower.

 

Section
7.3            Replacements and Replacement Reserve.

 

7.3.1        Replacement Reserve Fund.

 

(a)           During any Triggering Event Period, Borrower shall pay (or
cause to be paid) to Lender on each Payment Date one-twelfth (1/12) of $0.20 per square foot of net rentable space at the Properties (the “Replacement Reserve Monthly Deposit”) for replacements and
repairs required to be made to the Properties during the calendar year
(collectively, the “Replacements”). 
Amounts so deposited shall hereinafter be referred to as Borrower’s “Replacement
Reserve Fund”.

 

(b)           Upon the occurrence of a Triggering Event Termination
Event, upon written request of Borrower, Lender shall disburse all funds
contained in the Replacement Reserve Fund to Borrower.

 

95

 

7.3.2        Disbursements from Replacement Reserve Account.

 

Lender shall disburse to
Borrower the Replacement Reserve Fund from the Replacement Reserve Account from
time to time upon satisfaction by Borrower’s of each of the following
conditions:  (a) Borrower shall submit a
written request for payment to Lender at least ten (10) days prior to the date
on which Borrower requests such payment be made and specifying the Replacements
to be paid, (b) on the date such request is received by Lender and on the date
such payment is to be made, no Default or Event of Default shall exist and
remain uncured, (c) Lender shall have received an Officers’ Certificate (i)
stating that all Replacements (or the portion thereof) at the applicable
Individual Property to be funded by the requested disbursement have been
completed in good and workmanlike manner and, to Borrower’s knowledge, in
accordance with all Legal Requirements and Environmental Laws, such certificate
to be accompanied by a copy of any license, permit or other approval by any
Governmental Authority required to commence and/or complete the Replacements,
(ii) identifying each Person that supplied materials or labor in connection
with the Replacements performed at such Individual Property with respect to the
reimbursement to be funded by the requested disbursement, and (iii) stating
that each such Person has been paid in full, such Officers’ Certificate to be
accompanied by lien waivers or other evidence of payment satisfactory to
Lender, (d) at Lender’s option, a title search for such Individual Property
indicating that such Individual Property is free from all Liens, claims and
other encumbrances not previously approved by Lender, and (e) Lender shall have
received such other evidence as Lender shall reasonably request that the
Replacements (or the applicable portions thereof) at such Individual Property
to be funded by the requested disbursement have been completed in a good and
workmanlike manner and are paid for upon such disbursement to Borrower.  Lender shall not be required to make
disbursements from the Replacement Reserve Account unless such requested
disbursement is in an amount greater than $25,000 (or a lesser amount if the
total amount in the Replacement Reserve Account is less than $25,000, in which
case only one disbursement of the amount remaining in the account shall be
made).  Lender shall not be obligated to
make disbursements from the Replacement Reserve Account with respect to an
Individual Property in excess of the amount allocated for such Individual
Property.

 

7.3.3        Performance of Replacements.

 

(a)           Borrower shall make (or cause to be made) Replacements
when required in order to keep each Individual Property in good working order
and repair, and to keep (or cause to be kept) each Individual Property or any
portion thereof from deteriorating. 
Borrower shall complete (or cause to be completed) all Replacements in a
good and workmanlike manner as soon as practicable following the commencement
of making each such Replacement.

 

(b)           Subject to terms of the Operating Lease, Lender reserves
the right, at its option, to approve all contracts or work orders with
materialmen, mechanics, suppliers, subcontractors, contractors or other parties
providing labor or materials in connection with the Replacements costing, in the aggregate, in excess of
$500,000 with respect to each Individual Property.  Upon Lender’s request, Borrower shall assign
any contract or subcontract to Lender.

 

96

 

(c)           In the event Lender determines in its reasonable
discretion that any Replacement is not being performed in a workmanlike or
timely manner or that any Replacement has not been completed in a workmanlike
or timely manner, Lender shall have the option to withhold disbursement for
such unsatisfactory Replacement and to proceed under existing contracts or to
contract with third parties to complete such Replacement and to apply the
Replacement Reserve Fund toward the labor and materials necessary to complete
such Replacement, without providing any prior notice to Borrower and to
exercise any and all other remedies available to Lender upon an Event of
Default hereunder.

 

(d)           In order to facilitate Lender’s completion or making of
the Replacements pursuant to Section 7.3.3(c) above, Borrower grants Lender the
right to enter onto any Individual Property and perform any and all work and
labor necessary to complete or make the Replacements and/or employ watchmen to
protect such Individual Property from damage. 
All sums so expended by Lender, to the extent not from the Replacement
Reserve Fund, shall be deemed to have been advanced under the Loan to Borrower
and secured by the Security Instruments. 
For this purpose, Borrower constitutes and appoints Lender its true and
lawful attorney-in-fact with full power of substitution to complete or
undertake the Replacements in the name of Borrower.  Such power of attorney shall be deemed to be
a power coupled with an interest and cannot be revoked.  Borrower empowers said attorney-in-fact as
follows:  (i) to use any funds in the
Replacement Reserve Account for the purpose of making or completing the
Replacements; (ii) to make such additions, changes and corrections to the
Replacements as shall be necessary or desirable to complete the Replacements;
(iii) to employ such contractors, subcontractors, agents, architects and
inspectors as shall be required for such purposes; (iv) to pay, settle or
compromise all existing bills and claims which are or may become Liens against
any Individual Property, or as may be necessary or desirable for the completion
of the Replacements, or for clearance of title; (v) to execute all applications
and certificates in the name of Borrower which may be required by any of the
contract documents; (vi) to prosecute and defend all actions or proceedings in
connection with any Individual Property or the rehabilitation and repair of any
Individual Property; and (vii) to do any and every act which Borrower might do
in its own behalf to fulfill the terms of this Agreement.

 

(e)           Nothing in this Section 7.3.3 shall:  (i) make Lender responsible for making or
completing the Replacements; (ii) require Lender to expend funds in addition to
the Replacement Reserve Fund to make or complete any Replacement; (iii)
obligate Lender to proceed with the Replacements; or (iv) obligate Lender to
demand from Borrower additional sums to make or complete any Replacement.

 

(f)            Borrower shall permit Lender and Lender’s agents and
representatives (including, without limitation, Lender’s engineer, architect,
or inspector) or third parties making Replacements pursuant to this Section 7.3.3
to enter onto each Individual Property during normal business hours (subject to
the rights of Tenants under their Leases) to inspect the progress of any
Replacements and all materials being used in connection therewith, to examine
all plans and shop drawings relating to such Replacements which are or may be
kept at each Individual Property, and to complete any

 

97

 

Replacements made pursuant to this Section 7.3.3.  Borrower shall cause all contractors and
subcontractors to cooperate with Lender or Lender’s representatives or such
other persons described above in connection with inspections described in this
Section 7.3.3(f) or the completion of Replacements pursuant to this Section 7.3.3.

 

(g)           Lender may require an inspection of an Individual Property
at Borrower’s expense prior to making a monthly disbursement from the
Replacement Reserve Account, with respect to each Individual Property, in order
to verify completion of the Replacements for which reimbursement is
sought.  Lender may require that such
inspection be conducted by an appropriate independent qualified professional
selected by Lender and/or may require a copy of a certificate of completion by
an independent qualified professional acceptable to Lender prior to the
disbursement of any amounts from the Replacement Reserve Account.  Borrower shall pay the expense of the
inspection as required hereunder, whether such inspection is conducted by
Lender or by an independent qualified professional.

 

(h)           The Replacements and all materials, equipment, fixtures,
or any other item comprising a part of any Replacement shall be constructed,
installed or completed, as applicable, free and clear of all mechanic’s,
materialmen’s or other Liens.

 

(i)            Before each disbursement from the Replacement Reserve
Account with respect to each Individual Property, Lender may require Borrower
to provide Lender with a search of title to the applicable Individual Property
effective to the date of the disbursement, which search shows that no mechanic’s
or materialmen’s Liens or other Liens of any nature have been placed against
the applicable Individual Property since the date of recordation of the related
Security Instrument and that title to such Individual Property is free and
clear of all Liens (other than the Lien of the related Security Instrument and
other Permitted Encumbrances.

 

(j)            All Replacements shall comply with all applicable Legal
Requirements of all Governmental Authorities having jurisdiction over the
applicable Individual Property and applicable insurance requirements including,
without limitation, applicable building codes, special use permits,
environmental regulations, and requirements of insurance underwriters.

 

(k)           In addition to any insurance required under the Loan
Documents, Borrower shall provide, or cause to be provided, workmen’s
compensation insurance, builder’s risk, and public liability insurance and
other insurance to the extent required under Applicable Law in connection with
a particular Replacement.  All such
policies shall be in form and amount reasonably satisfactory to Lender.  All such policies which can be endorsed with
standard mortgagee clauses making loss payable to Lender or its assigns shall
be so endorsed.  Certified copies of such
policies shall be delivered to Lender

 

98

 

7.3.4        Balance in the Replacement Reserve Account.

 

The insufficiency of any
balance in the Replacement Reserve Account shall not relieve Borrower from its
obligation to fulfill all preservation and maintenance covenants in the Loan
Documents.

 

Section
7.4            Intentionally Omitted.

 

Section
7.5            Holdback Reserve Funds.

 

Borrower shall establish on
the date hereof an Eligible Account with Lender or Lender’s agent (“Holdback
Reserve Account”), into which Borrower shall deposit on the date hereof
$1,790,000.00 (the “Holdback Reserve Funds”). 
Upon Lender’s consent to the purchase of the Fee Estate of the
Burlington Property pursuant to Section 2.7 hereof, in the event that Borrower
provides evidence satisfactory to Lender in its reasonable discretion that (i)
the sale of the Burlington Property has occurred and (ii) Borrower has
fulfilled the requirements of Section 2.7 hereof, Lender shall release such
Holdback Reserve Funds to Borrower. 
Borrower shall be entitled to one disbursement pursuant to this Section
7.5 and shall not have the ability for multiple fundings.  Any amount remaining in the Holdback Reserve
Account after the Debt has been paid in full shall be returned to Borrower and
no other party shall have any right or claim thereto.  Upon an Event of Default, Lender shall have
the right, as determined by Lender in its sole discretion, to apply all or a
portion of the Holdback Reserve Funds to the payment of the Debt, in such order
as Lender shall determine in its sole discretion.

 

Section
7.6            Ground Lease Escrow
Fund.

 

(a)           During
any Triggering Event Period, Borrower shall pay (or cause to be paid) to
Lender, together with the Monthly Debt Service Payment Amount, a monthly
prorated amount (the “Monthly Ground Rent Deposit”) that is estimated by Lender
to be due and payable by Borrower under the Ground Lease for all rent and any
and all other charges (the “Ground Rent”) which may be due (for the next
succeeding 12 month period) by Borrower under the Ground Lease in order to
accumulate with Lender sufficient funds to pay all sums payable under the
Ground Lease at least ten (10) Business Days prior to the dates due (said
amounts, hereinafter called the “Ground Lease Escrow Fund”).  The Ground Lease Escrow Fund is for the
purpose of paying all sums due under the Ground Lease.  Lender shall apply any amounts held in the
Ground Lease Escrow Fund to the payment of such Ground Rent.  Upon notice to Borrower, such deposit may be
increased by Lender in the amount Lender deems is necessary in its reasonable
discretion based on any increases in the Ground Rent due under the Ground
Lease.

 

(b)           Upon
the occurrence of a Triggering Event Termination Event, upon written request of
Borrower, Lender shall disburse all funds contained in the Ground Lease Escrow
Fund to Borrower.

 

Section
7.7            Reserve Funds
Generally.

 

(a)           Borrower grants to Lender a first-priority perfected
security interest in each of the Reserve Funds and the related Accounts and any
and all monies now or hereafter deposited in each Reserve Fund and related Account
as additional security for

 

99

 

payment of the Debt.  Until
expended or applied in accordance herewith, the Reserve Funds and the related
Accounts shall constitute additional security for the Debt.

 

(b)           Upon the occurrence and during the continuance of an Event
of Default, Lender may, in addition to any and all other rights and remedies
available to Lender, apply any sums then present in any or all of the Reserve
Funds to the payment of the Debt in any order in its sole discretion.

 

(c)           Intentionally Omitted.

 

(d)           The Reserve Funds shall be held in interest bearing
accounts and all earnings or interest on a Reserve Fund shall be added to and
become a part of such Reserve Fund and shall be disbursed in the same manner as
other monies deposited in such Reserve Fund.

 

(e)           Borrower shall not, without obtaining the prior written
consent of Lender, further pledge, assign or grant any security interest in any
Reserve Fund or related Account or the monies deposited therein or permit any
lien or encumbrance to attach thereto, or any levy to be made thereon, or any
UCC-1 Financing Statements, except those naming Lender as the secured party, to
be filed with respect thereto.

 

(f)            Borrower shall indemnify Lender and hold Lender harmless
from and against any and all actions, suits, claims, demands, liabilities,
losses, damages, obligations and costs and expenses (including litigation costs
and reasonable attorneys fees and expenses) arising from or in any way
connected with the Reserve Funds or the related Accounts or the performance of
the obligations for which the Reserve Funds or the related Accounts were
established, except to the extent arising from the gross negligence or willful
misconduct of Lender, its agents or employees. 
Borrower shall assign to Lender all rights and claims Borrower may have
against all Persons supplying labor, materials or other services which are to
be paid from or secured by the Reserve Funds or the related Accounts; provided,
however, that Lender may not pursue any such right or claim unless an Event of
Default has occurred and remains uncured.

 

Section
7.8            Excess Cash Reserve.

 

Borrower shall deposit (or
cause to be deposited) the Required Excess Cash on each Payment Date during any
Lockbox Cash Flow Sweep Period into the Excess Cash Reserve Account.  Amounts so deposited shall hereinafter be
referred to as the “Excess Cash Reserve Funds.” 
Provided no Event of Default has occurred and is continuing, sums from
the Excess Cash Reserve Account shall be disbursed to Borrower upon a Lockbox
Cash Flow Sweep Period Termination Event.

 

Section
7.9            Operating Expenses; Extraordinary Expenses.

 

(a)           Funds in the Lockbox Account shall be funded during a
Lockbox Cash Flow Sweep Period to the Operating Expense Reserve Fund in an
amount sufficient to pay all Operating Expenses required to be incurred during
the following month in accordance with the Approved Annual Budget.  Amounts so deposited shall hereinafter

 

100

 

be referred to as the “Operating Expense Reserve Funds.”  Provided no Event of Default has occurred and
is continuing, sums from the Operating Expense Reserve Account shall be
disbursed by Lender to Borrower following written request for the payment of
such Operating Expenses in accordance with the Approved Annual Budget.

 

(b)           Funds in the Lockbox Account shall be funded during a
Lockbox Cash Flow Sweep Period to the Operating Expense Reserve Fund in an
amount sufficient to pay any Extraordinary Expense approved by Lender from time
to time upon application by Borrower specifying such Extraordinary Expenses in
accordance with this Section 7.9. 
Borrower shall deposit, on each Payment Date during a Lockbox Cash Flow
Sweep Period funds sufficient to pay any Extraordinary Expenses for the
following month which have been approved by Lender into the Extraordinary
Expense Reserve Account, if any.  Amounts
so deposited shall hereinafter be referred to as the “Extraordinary Expense
Reserve Funds.”  Provided no Event of
Default has occurred and is continuing, sums from the Extraordinary Expense
Reserve Account shall be disbursed by Lender to Borrower following receipt and
approval of Borrower’s written request for the payment of such Extraordinary
Expenses, which approval shall not be unreasonably withheld.

 

Section
7.10         Provisions Regarding Letters of Credit

 

(a)           Notwithstanding anything herein to the contrary, Borrower
may meet its obligations to fund any or all of the Initial Deposits or other
deposits required to be made and maintained during a Triggering Event Period,
by delivering to Lender a Letter of Credit in such amount as may be necessary
to meet the deposit obligations under this Article 7.  Any Letter of Credit delivered under this
Agreement shall be additional security for the payment of the Debt.  Upon the occurrence and continuance of an
Event of Default, Lender shall have the right, at its option, to draw on any
such Letter of Credit and to apply all or any part thereof to the payment of
the items for which such Letter of Credit was established or to apply each such
Letter of Credit to payment of the Debt in such order, proportion or priority
as Lender may determine.  On the Maturity
Date if the Debt is not paid in full, any such Letter of Credit may be applied
to reduce the Debt.

 

(b)           In addition to any other right Lender may have to draw
upon a Letter of Credit pursuant to the terms and conditions of this Agreement,
Lender shall have the additional rights to draw in full on any Letter of
Credit: (i) if Lender has received a notice from the Issuing Bank that the
Letter of Credit will not be renewed and either (y) a substitute Letter of
Credit or (z) Cash in the amount of the Letter of Credit is not provided at
least ten (10) Business Days prior to the date on which the outstanding Letter
of Credit is scheduled to expire; (ii) upon receipt of notice from the Issuing
Bank that the Letter of Credit will be terminated; or (iii) if the bank issuing
the Letter of Credit shall cease to satisfy the Minimum L/C Rating and Borrower
fails to deliver a substitute Letter of Credit or Cash in the amount of the
Letter of Credit within ten (10) Business Days of such event.  Notwithstanding anything to the contrary
contained in the above, Lender is not obligated to draw down on any Letter of
Credit upon the happening of an event specified in (i), (ii) or (iii) above and
shall not be liable for any losses sustained by Borrower due to the insolvency
of the bank issuing the Letter of Credit if Lender has not drawn the Letter of
Credit and in the event of the insolvency of the bank issuing the

 

101

 

Letter of Credit or if the bank issuing the Letter of Credit ceases to
satisfy the Minimum L/C Rating, Borrower shall provide to Lender within the
time frames set forth above either (y) a substitute Letter of Credit meeting
the requirements hereof or (z) Cash in the amount of the Letter of Credit. If a
Letter of Credit has been posted by Tenant or Borrower on behalf of Tenant,
such Letter of Credit may be reduced from time to time by Tenant or Borrower
placing a replacement or substitute Letter of Credit in the revised amount
necessary to reflect the compliance with performance obligations (in whole or
in part) for which such Letter of Credit was placed to secure.

 

VIII.        DEFAULTS

 

Section
8.1            Event of Default.

 

(a)           Each of the following events shall constitute an event of
default hereunder (an “Event of Default”):

 

(i)               if any portion of the Debt is not paid on the date the
same is due and payable or, if such date is not a Business Day, then the next
succeeding Business Day; provided, however, Borrower shall not be in default (A)
so long as there is sufficient money in the Lockbox Account for payment of all
amounts then due and payable (including, but not limited to, any deposits into
Reserve Accounts, collectively the “Full Payment”) and Lender’s access to the
Full Payment has not been constrained or constricted in any manner or (B) if
there is not sufficient money in the Lockbox Account for the Full Payment on
the Payment Date, so long as Borrower deposits the Full Payment within three
(3) Business Days after such Payment Date; provided that the preceding
subsection (B) shall be applicable and permitted by Lender no more than twice
every 12 (twelve) month period;

 

(ii)              if any of the Taxes or Other Charges are not paid on or
before the date that the same become delinquent; provided, however, Borrower
shall not be in default so long as there is sufficient money in the Lockbox
Account for payment of all amounts then due and payable (including any deposits
into Reserve Accounts) and Lender’s access to such money has not been
constrained or constricted in any manner;

 

(iii)             if the Policies are not kept in full force and effect or
if certified copies of the Policies are not delivered to Lender within three
(3) Business Days after written request; provided, however, Borrower shall not
be in default so long as there is sufficient money in the Lockbox Account for
payment of all amounts then due and payable (including any deposits into
Reserve Accounts) and Lender’s access to such money has not been constrained or
constricted in any manner;

 

(iv)             if Borrower transfers or encumbers any portion of any of
the Properties in violation of the provisions of Section 5.2.10 hereof or
Article 7 of the Security Instruments;

 

(v)              if any representation or warranty made by (A) Borrower
or Principal herein or in any
other Loan Document, (B) Indemnitor in the

 

102

 

Environmental Indemnity, (C) Guarantor in the Guaranty, or (C)
Borrower, Principal, Indemnitor or Guarantor in any report, certificate, financial
statement or other instrument, agreement or document furnished to Lender shall
have been knowingly false or misleading in any material respect as of the date
the representation or warranty was made;

 

(vi)             if Borrower, Principal, Indemnitor or
Guarantor shall make an
assignment for the benefit of creditors;

 

(vii)            if a receiver, liquidator or trustee shall be appointed
for Borrower, Principal, Indemnitor, or Guarantor or if Borrower, Principal, Indemnitor, or
Guarantor shall be adjudicated a
bankrupt or insolvent, or if any petition for bankruptcy, reorganization or
arrangement pursuant to the Bankruptcy Code, or any similar federal or State
law, shall be filed by or against, consented to, or acquiesced in by, Borrower,
Principal, Indemnitor, or Guarantor,
or if any proceeding for the dissolution or liquidation of Borrower, Principal,
Indemnitor
or Guarantor shall be
instituted; provided, however, if such appointment, adjudication, petition or
proceeding was involuntary and not knowingly consented to by Borrower,
Principal, Indemnitor or Guarantor,
upon the same not being discharged, stayed or dismissed within sixty (60) days;

 

(viii)           if Borrower attempts to assign its
rights under this Agreement or any of the other Loan Documents or any interest
herein or therein in contravention of the Loan Documents;

 

(ix)             if Borrower breaches any of its respective negative
covenants contained in Section 5.2;

 

(x)              if Borrower violates or does not comply with any of the
provisions of Section 5.1.17 hereof;

 

(xi)             if a default has occurred and continues beyond any
applicable cure period under any Management Agreement, if any (or any
Replacement Management Agreement, if any), if such default permits the Manager
thereunder to terminate or cancel any Management Agreement (or any Replacement
Management Agreement);

 

(xii)            if Borrower or Principal violates or does not comply with
any of the material provisions of Section 4.1.35 hereof;

 

(xiii)           if any Individual Property becomes
subject to any mechanic’s, materialman’s or other Lien in excess of $500,000.00
other than a Lien for local real estate taxes and assessments not then due and
payable and the Lien shall remain undischarged of record (by payment, bonding
or otherwise) for a period of ninety (90) days;

 

103

 

(xiv)           if any federal tax Lien or state or local income tax Lien
is filed against Borrower or any Individual Property and same is not discharged
of record or bonded within ninety (90) days after same is filed;

 

(xv)            (A) Borrower fails to timely provide Lender with the
written certification and evidence referred to in Section 5.2.8 hereof, (B)
Borrower is a Plan or its assets constitute Plan Assets; or (C) Borrower
consummates a transaction which would cause the Security Instruments or Lender’s
exercise of its rights under the Security Instruments, the Note, this Agreement
or the other Loan Documents to constitute a nonexempt prohibited transaction
under ERISA or result in a violation of a State statute regulating governmental
plans, subjecting Lender to liability for a violation of ERISA, the Code, a
State statute or other similar law;

 

(xvi)           if Borrower shall fail to deliver to Lender, within ten
(10) Business Days after request by Lender, the estoppel certificates required
pursuant to the terms hereof; provided, however, that if Borrower is using
reasonable and diligent efforts to obtain such estoppel certificate from the
Operating Tenant under the Operating Lease, then Borrower shall not be in
default hereunder;

 

(xvii)          if any default occurs under any
guaranty or indemnity executed in connection herewith (including, without limitation,
the
Guaranty and the Environmental
Indemnity) and such default continues after the expiration of applicable grace
periods, if any;

 

(xviii)         if Borrower shall be in default beyond
applicable notice and grace periods under any other mortgage, deed of trust,
deed to secure debt or other security agreement covering any part of any
Individual Property whether it be superior or junior in lien to the related
Security Instrument;

 

(xix)            Intentionally Omitted;

 

(xx)             with respect to any term, covenant or provision set
forth herein which specifically contains a notice requirement or grace period,
if Borrower shall be in default under such term, covenant or condition after
the giving of such notice or the expiration of such grace period;

 

(xxi)            if Borrower shall fail to pay or cause to be paid, prior
to the expiration of any applicable grace and cure periods under the Ground
Lease, the Ground Rent or any additional rent, if any, or other charge
mentioned in or made payable by any Ground Lease when said rent or other charge
is due and payable and such failure results in an “Event of Default” under the
Ground Lease; provided, however, Borrower shall not be in default so long as
there is sufficient money in the Lockbox Account for payment of all amounts
then due and payable (including any deposits into Reserve Accounts) and Lender’s
access to such money has not been constrained or constricted in any manner;

 

(xxii)           if there shall occur any material
default by Borrower, as tenant under any Ground Lease, in the observance or performance
of any material term,

 

104

 

covenant or condition of such Ground Lease on the part of Borrower to
be observed or performed and said default is not cured following the expiration
of any applicable grace and notice periods therein provided, or if the
leasehold estate created by such Ground Lease shall be surrendered or if such
Ground Lease shall cease to be in full force and effect or such Ground Lease
shall be terminated or canceled for any reason or under any circumstances
whatsoever, or if any of the material terms, covenants or conditions of such
Ground Lease shall in any manner be materially modified, changed, supplemented,
altered, or amended without the consent of Lender; provided, however, that if
the Ground Lease expires upon its own terms or is not renewed by Borrower, such
inaction by Borrower shall not constitute an Event of Default hereunder;

 

(xxiii)          if any of the assumptions contained in
the Insolvency Opinion, or in any other “non-consolidation” opinion delivered
to Lender in connection with the Loan, or in any other “non-consolidation”
delivered subsequent to the closing of the Loan, is or shall become untrue in
any material respect;

 

(xxiv)         if any of the material terms, covenants
or conditions of the Operating Lease shall be modified, changed, supplemented,
altered, or amended without the written consent of Lender, including, but not
limited to, provisions relating to the term, the rental obligations of the
applicable Operating Tenant thereunder or any other economic provisions of the
Operating Lease;

 

(xxv)          if any Letter of Credit is not renewed, replaced or
substituted with Cash in accordance with the terms hereof at least five (5)
Business Days prior to the expiration date of such Letter of Credit;

 

(xxvi)         in the event that the long term credit
rating of the Issuing Bank falls below the Minimum L/C Rating and Borrower
fails to deliver to Lender within five (5) Business Days thereafter a Letter of
Credit or Cash in an amount equal to the amount of the Letter of Credit being
replaced from an Issuing Bank having a credit rating of no less than the
Minimum L/C Rating;

 

(xxvii)        if there shall be an Event of Default
under the terms of any of the Security Instruments or any of the other Loan
Documents beyond any applicable notice and cure periods contained in such
documents, whether as to Borrower or any Individual Property; or

 

(xxviii)       if Borrower shall continue to be in
Default under any of the other terms, covenants or conditions of this Agreement
not specified in subsections (i) to (xxvii) above (excluding the Event of
Default set forth in subsection (xxiii) above, meaning this subsection (xxviii)
shall apply thereto) for ten (10) days after notice to Borrower 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;
provided, however, that if such non-monetary Default is susceptible of cure but
cannot reasonably be cured within such 30-day period and provided further that
Borrower shall have commenced to cure such Default within

 

105

 

such thirty (30) day period and thereafter diligently and expeditiously
proceeds to cure the same, such thirty (30) day period shall be extended for
such time as is reasonably necessary for Borrower in the exercise of due
diligence to cure such Default, such additional period not to exceed one
hundred twenty (120) days and thereafter such period as shall be approved by
Lender.

 

(b)           Upon the occurrence and during the continuance of an Event
of Default (other than an Event of Default described in clauses (vi) or (vii)
above) and at any time thereafter, in addition to any other rights or remedies
available to it pursuant to this Agreement and the other Loan Documents or at
law or in equity, Lender may take such action, without notice or demand other
than such notice as may be required under the laws of the State applicable to
the Individual Property or otherwise as required hereunder, that Lender deems
advisable to protect and enforce its rights against Borrower and in and to all
or any Individual Property, including, without limitation, declaring the Debt
to be immediately due and payable, and Lender may enforce or avail itself of
any or all rights or remedies provided in the Loan Documents against Borrower
and any or all of the Properties, including, without limitation, all rights or
remedies available at law or in equity; and upon any Event of Default described
in clauses (vi) or (vii) above, the Debt and all other obligations of Borrower
hereunder and under the other Loan Documents shall immediately and
automatically become due and payable, without notice or demand, and Borrower
hereby expressly waives any such notice or demand, anything contained herein or
in any other Loan Document to the contrary notwithstanding.

 

Section
8.2            Remedies.

 

(a)           Upon the occurrence and during the continuance of an Event
of Default, all or any one or more of the rights, powers, privileges and other
remedies available to Lender against Borrower under this Agreement or any of
the other Loan Documents executed and delivered by, or applicable to, Borrower
at law or in equity may be exercised by Lender at any time and from time to
time, whether or not all or any of the Debt shall be declared due and payable,
and whether or not Lender shall have commenced any foreclosure proceeding or
other action for the enforcement of its rights and remedies under any of the
Loan Documents with respect to all or any Individual Property or any other
Collateral.  Any such actions taken by
Lender shall be cumulative and concurrent and may be pursued independently,
singly, successively, together or otherwise, at such time and in such order as
Lender may determine in its sole discretion, to the fullest extent permitted by
Applicable Law, without impairing or otherwise affecting the other rights and
remedies of Lender permitted by Applicable Law, equity or contract or as set
forth herein or in the other Loan Documents. 
Without limiting the generality of the foregoing, Borrower agrees that
if an Event of Default is continuing (i) Lender is not subject to any “one
action” or “election of remedies” law or rule, and (ii) all Liens and other
rights, remedies or privileges provided to Lender shall remain in full force
and effect until Lender has exhausted all of its remedies against the
Properties and the other Collateral and each Security Instrument has been
foreclosed, sold and/or otherwise realized upon in satisfaction of the Debt or
the Debt has been paid in full.

 

106

 

(b)           With respect to Borrower and the Properties, nothing
contained herein or in any other Loan Document shall be construed as requiring
Lender to resort to any Individual Property or Collateral for the satisfaction
of any of the Debt in preference or priority to any other Individual Property
or Collateral, and Lender may seek satisfaction out of all of the Properties or
any other Collateral or any part thereof, in its absolute discretion in respect
of the Debt.  In addition, Lender shall
have the right from time to time to partially foreclose the Security
Instruments in any manner and for any amounts secured by the Security
Instruments then due and payable as determined by Lender in its sole discretion
including, without limitation, the following circumstances:  (i) in the event Borrower defaults beyond any
applicable grace period in the payment of one or more scheduled payments of
principal and interest, Lender may foreclose one or more of the Security
Instruments to recover such delinquent payments, or (ii) in the event Lender
elects to accelerate less than the entire outstanding principal balance of the
Loan, Lender may foreclose one or more of the Security Instruments to recover
so much of the principal balance of the Loan as Lender may accelerate and such
other sums secured by one or more of the Security Instruments as Lender may
elect.  Notwithstanding one or more
partial foreclosures, the Properties shall remain subject to the Security
Instruments to secure payment of sums secured by the Security Instruments and
not previously recovered.

 

(c)           Lender shall have the right, from time to time, to sever
the Note and the other Loan Documents into one or more separate notes,
mortgages and other security documents (the “Severed Loan Documents”) in such
denominations as Lender shall determine in its sole discretion for purposes of
evidencing and enforcing its rights and remedies provided hereunder.  Borrower shall execute and deliver to Lender
from time to time, promptly after the request of Lender, a severance agreement
and such other documents as Lender shall request in order to effect the
severance described in the preceding sentence, all in form and substance
reasonably satisfactory to Lender. 
Borrower hereby absolutely and irrevocably appoints Lender as its true
and lawful attorney, coupled with an interest, in its name and stead to make
and execute all documents necessary or desirable to effect the aforesaid
severance, Borrower ratifying all that its said attorney shall do by virtue
thereof; provided, however, Lender shall not make or execute any such documents
under such power until three (3) Business Days after notice has been given to
Borrower by Lender of Lender’s intent to exercise its rights under such
power.  The Severed Loan Documents shall
not contain any representations, warranties or covenants not contained in the
Loan Documents and any such representations and warranties contained in the
Severed Loan Documents will be given by Borrower only as of the Closing Date.

 

Section
8.3            Remedies
Cumulative; Waivers.

 

The rights, powers and
remedies of Lender under this Agreement shall be cumulative and not exclusive
of any other right, power or remedy which Lender may have against Borrower
pursuant to this Agreement or the other Loan Documents, or existing at law or
in equity or otherwise.  Lender’s rights,
powers and remedies may be pursued singularly, concurrently or otherwise, at
such time and in such order as Lender may determine in Lender’s sole
discretion.  No delay or omission to
exercise any remedy, right or power accruing upon an Event of Default

 

107

 

shall impair any such
remedy, right or power or shall be construed as a waiver thereof, but any such
remedy, right or power may be exercised from time to time and as often as may
be deemed expedient.  A waiver of one or
more Defaults or Events of Default with respect to Borrower shall not be
construed to be a waiver of any subsequent Default or Event of Default by
Borrower or to impair any remedy, right or power consequent thereon.

 

IX.           SPECIAL
PROVISIONS

 

Section
9.1            Sale of Notes and Securitization.  

 

Lender may, at any time,
sell, transfer or assign the Note, this Agreement, the Security Instruments and
the other Loan Documents, and any or all servicing rights with respect thereto,
or grant participations therein or issue mortgage pass-through certificates or
other securities (the “Securities”) evidencing a beneficial interest in a rated
or unrated public offering or private placement (a “Securitization”); provided
that Lender shall not engage in any Securitization with respect to a portion of
the Loan which exceeds ten percent (10%) of the original amount of such
Securitization.  At the request of the
holder of the Note and, to the extent not already required to be provided by
Borrower under this Agreement, Borrower, at Borrower’s expense
(but subject to the last sentence of this Section 9.1), shall satisfy the
market standards to which the holder of the Note customarily adheres or which
may be reasonably required in the marketplace or by the Rating Agencies in
connection with a Securitization or the sale of the Note or the participations or
Securities, including, without limitation, to:

 

(a)           (i)            provide
such financial and other information with respect to the Properties, Borrower,
Tenants to the extent Borrower is entitled to such information under the
Operating Lease, Guarantor, Indemnitor and the
Manager, (ii) provide budgets relating to the Properties as may be provided by
Tenants under the Leases, if any (but which shall not be required to be
updated) and (iii) permit Lender to perform (at is own cost) such site
inspection, appraisals, market studies, environmental reviews and reports
(Phase I’s and, if appropriate, Phase II’s), engineering reports and other due
diligence investigations of the Properties, as may be reasonably requested by
the holder of the Note or the Rating Agencies or as may be necessary or
appropriate in connection with the Securitization (the “Provided Information”),
together, if customary, with appropriate verification and/or consents of the
Provided Information through letters of auditors or opinions of counsel of independent
attorneys acceptable to Lender and the Rating Agencies; provided, however, other
than as required pursuant to Section 5.1.10 hereof, that at no time shall
Borrower, Guarantor, Indemnitor or Manager be required to provide information
with respect to (i) anticipated store closures and (ii) individual retail store
profitability (including but not limited to per-store sales or occupancy costs);

 

(b)           If required by the Rating Agencies, deliver, as are
necessary to comply with the provisions of Section 4.1.35 hereof, (i) a revised
Insolvency Opinion, (ii) revised opinions of counsel as to due execution and
enforceability with respect to the Properties, Borrower, and the Loan
Documents, and (iii) revised organizational documents for Borrower, and Principal, which counsel, opinions
and organizational documents shall be satisfactory to Lender and the Rating
Agencies;

 

108

 

(c)           Intentionally Omitted;

 

(d)           execute such amendments to the Loan Documents and organizational
documents as may be requested by the holder of the Note or the Rating Agencies
or otherwise to effect the Securitization; provided, however, that Borrower
shall not be required to modify or amend any Loan Document or organizational
documents if such modification or amendment would (except for modifications and
amendments required to be made pursuant to Section (e) below,) (i) change the
interest rate, the stated maturity or the amortization of principal set forth
in the Note, (ii) modify or amend any other material economic term of the Loan (including
any non-recourse carve-out provisions) or (iii) have an adverse economic impact
on Borrower or any Affiliate thereof; and

 

(e)           if Lender elects, in its sole discretion, prior to or upon
a Securitization, to split the Loan into two or more parts, or the Note into
multiple component notes or tranches which may have different interest rates,
amortization payments, principal amounts, payment priorities, and maturities,
Borrower agrees to reasonably cooperate with Lender in connection with the
foregoing and to execute the required modifications and amendments to the Note,
this Agreement and the Loan Documents and to provide opinions reasonably
necessary to effectuate the same so long as the initial principal amount of
such multiple component notes or tranches does not exceed the outstanding
principal amount of the Note immediately prior to such split.  Such Notes or components may be assigned
different interest rates, so long as the initial weighted average of such
interest rates does not exceed the Applicable Interest Rate.

 

Other than for legal
counsel, accountants and other professionals engaged by Borrower, Borrower
shall not be obligated to incur any cost or expense in connection with Borrower’s complying with requests made under this Section 9.1.

 

Section
9.2            Securitization
Cooperation.

 

Borrower understands that
certain of the Provided Information may be included in disclosure documents in
connection with the Securitization, including, without limitation, a prospectus
supplement, private placement memorandum, offering circular or other offering
document (each a “Disclosure Document”) and may also be included in filings (an
“Exchange Act Filing”) with the Securities and Exchange Commission pursuant to
the Securities Act of 1933, as amended (the “Securities Act”), or the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), or provided
or made available to Investors or prospective Investors in the Securities, the
Rating Agencies, and service providers relating to the Securitization.  In the event that the Disclosure Document is
required to be revised prior to the sale of all Securities, Borrower will
cooperate with the holder of the Note in updating the Disclosure Document by
providing all current information in Borrower’s possession or which Borrower
has a right to obtain under the Operating Lease from the Operating Tenant necessary
to keep the Disclosure Document accurate and complete in all material respects;
provided, however, no Disclosure Document shall contain an Individual Store
Capital Expenditure Schedule.  This
Section 9.2 is further subject to the confidentiality and disclosure provisions
of Section 5.1.10(h) hereof.

 

109

 

Section
9.3            Servicer.

 

At the option of Lender, the
Loan may be serviced by a servicer/trustee (the “Servicer”) selected by Lender
and Lender may delegate all or any portion of its responsibilities under this
Agreement and the other Loan Documents to the Servicer pursuant to a servicing
agreement (the “Servicing Agreement”) between Lender and Servicer; provided,
however, the appointment of a servicer or trustee shall not modify the
provisions of this Agreement, including, without limitation, any cash
management provisions, provisions regarding the collection of Rents or the
holding, funding and disbursement from any Accounts maintained hereunder.

 

Section
9.4            Exculpation.

 

(a)           Except as otherwise provided herein, in the Security
Instruments or in the other Loan Documents, Lender shall not enforce the
liability and obligation of Borrower to perform and observe the obligations
contained in this Agreement, the Note or the Security Instruments by any action
or proceeding wherein a money judgment shall be sought against Borrower, except
that Lender may bring a foreclosure action, action for specific performance or
other appropriate action or proceeding to enable Lender to enforce and realize
upon this Agreement, the Note, the Security Instruments, the other Loan
Documents, and the interest in the Properties, the Rents and any other
collateral given to Lender created by this Agreement, the Note, the Security
Instruments and the other Loan Documents; provided, however, that any judgment
in any such action or proceeding shall be enforceable against Borrower only to
the extent of Borrower’s interest in the Properties, in the Rents and in any
other collateral given to Lender. Lender, by accepting this Agreement, the Note
and the Security Instruments, agrees that it shall not, except as otherwise
provided herein or in the Security Instruments, sue for, seek or demand any
deficiency judgment against Borrower in any such action or proceeding, under or
by reason of or under or in connection with this Agreement, the Note, the
Security Instruments or the other Loan Documents.  The provisions of this Section shall not,
however, (i) constitute a waiver, release or impairment of any obligation
evidenced or secured by this Agreement, the Note, the Security Instruments or
the other Loan Documents; (ii) impair the right of Lender to name Borrower as a
party defendant in any action or suit for judicial foreclosure and sale under
the Security Instruments; (iii) affect the validity or enforceability of any
indemnity (including, without limitation, the Environmental Indemnity),
guaranty (including, without limitation, the Guaranty), master lease or similar
instrument made in connection with this Agreement, the Note, the Security
Instruments, or the other Loan Documents; (iv) impair the right of Lender to obtain
the appointment of a receiver; (v) impair the enforcement of the assignment of
leases and rents provisions contained in the Security Instruments; (vi) impair
the right of Lender to enforce the provisions of Section 10.2 of the Security
Instruments or Sections 4.1.8, 4.1.28, 5.1.9 and 5.2.8 hereof; or (vii) impair
the right of Lender to obtain a deficiency judgment or other judgment on the
Note against Borrower if necessary to (A) preserve or enforce its rights and
remedies against any Individual Property or (B) obtain any Insurance Proceeds
or Awards to which Lender would otherwise be entitled under the terms of this
Agreement or the Security Instruments; provided however, Lender shall only
enforce such judgment to the extent of the Insurance Proceeds and/or Awards.

 

(b)           Notwithstanding the provisions of this Section 9.4 to the
contrary, Borrower shall be personally liable to Lender for the Losses it
incurs due to: (i) fraud or

 

110

 

intentional misrepresentation in connection with the execution and the
delivery of this Agreement, the Note, the Security Instrument, or the other
Loan Documents; (ii) Borrower’s misapplication or misappropriation of Rents
received by Borrower after the occurrence of a Default or Event of Default;
(iii) Borrower’s misapplication or misappropriation of Security Deposits or
Rents collected more than thirty (30) days in advance; (iv) Borrower’s
misapplication or the misappropriation of Insurance Proceeds or Awards; (v)
Borrower’s failure to pay Taxes, Other Charges (except to the extent that sums
sufficient to pay such amounts have been deposited in escrow with Lender
pursuant to the terms of hereof), charges for labor or materials or other
charges that can create Liens on the Properties; (vi) Borrower’s failure to
return or to reimburse Lender for all Personal Property taken from any
Properties by or on behalf of Borrower and not replaced with Personal Property
of the same utility and of the same or greater value; (vii) any act of intentional
waste or arson by Borrower, Principal, or any Affiliate thereof or by
Indemnitor or Guarantor; (viii) any fees or commissions paid by Borrower to
Principal or any Affiliate of Borrower or Principal, Indemnitor, or Guarantor
in violation of the terms of this Agreement, the Note, the Security Instruments
or the other Loan Documents; (ix) Borrower’s failure to comply with the
provisions of Sections 4.1.39 and 5.1.19 of this Agreement; (x) a material
misrepresentation contained in any Required Out-Parcel Officer’s Certificate; or
(xi) any unpaid Madison Property Option Shortfall Amount due pursuant to
Section 2.5.5 hereof; provided, however, that in no event shall Guarantor be
obligated for any Madison Property Option Shortfall Amount in excess of ten percent
(10%) of the original principal amount of the Loan.

 

(c)           Notwithstanding the foregoing, the agreement of Lender not
to pursue recourse liability as set forth in Subsection (a) above SHALL BECOME
NULL AND VOID and shall be of no further force and effect (i) in the event of a
default under Section 4.1.35 of this Agreement such that such failure was
considered by a court as a factor in the court’s finding for a consolidation of
the assets of Borrower with the assets of another Person; provided, however, that
in the absence of an actual consolidation, recourse may be had against Borrower
only to the extent of Losses actually incurred by Lender for Borrower’s failure
to comply with the provisions of Section 4.1.35; (ii) in the event of any
Borrower’s willful failure to provide a report or information required under
Section 5.1.10, but a failure to provide such reports or information shall not
be deemed willful if such failure is the result of good faith error and is
cured within ten (10) Business Days after notice is delivered to Borrower,
provided, however, that if (x) Borrower is prevented by an unaffiliated third
party (including but not limited to the Operating Tenants) from delivering such
information, and (y) Borrower uses reasonable efforts to obtain such
information, then such failure shall not be deemed willful so long as Borrower
continuously endeavors in good faith to obtain the required financial reports
and information and delivers same to Lender as soon as it becomes available to
Borrower; (iii) in the event of a Transfer other than as expressly permitted
pursuant to Section 5.2.10(c) hereof; (iv) in the event of a default under
Section 5.2.10(d) hereof; (v) if any Individual Property or any part thereof
shall become an asset in (A) a voluntary bankruptcy or insolvency proceeding or
(B) an involuntary bankruptcy or insolvency proceeding commenced by Guarantor,
Indemnitor or any Affiliate of any of the foregoing and Borrower fails to use
its commercially reasonable efforts to obtain a dismissal of such proceedings;
or (vi) in the event that Borrower (A) solicits or causes to be solicited

 

111

 

petitioning creditors for any involuntary petition against Borrower
from any Person or (B) files an answer consenting to or otherwise acquiescing
in or joining in any involuntary petition filed against it by any other Person
under the Bankruptcy Code or any other Federal or state bankruptcy or
insolvency law.

 

(d)           Nothing herein shall be deemed to be a waiver of any right
which Lender may have under Section 506(a), 506(b), 1111(b) or any other
provision of the Bankruptcy Code to file a claim for the full amount of the
indebtedness secured by the Security Instruments or to require that all
collateral shall continue to secure all of the indebtedness owing to Lender in
accordance with this Agreement, the Note, the Security Instruments and the
other Loan Documents.

 

Section
9.5            Contributions and
Waivers.

 

(a)           As a result of the transactions contemplated by this
Agreement, each Borrower will benefit, directly and indirectly, from each
Borrower’s obligation to pay the Debt and perform its Obligations and in
consideration therefor each Borrower desires to enter into an allocation and
contribution agreement among themselves as set forth in this Section 9.5 to
allocate such benefits among themselves and to provide a fair and equitable
agreement to make contributions among each Borrower in the event any payment is
made by any individual Borrower hereunder to Lender (such payment being
referred to herein as a “Contribution,” and for purposes of this Section 9.5,
includes any exercise of recourse by Lender against any Collateral of a
Borrower and application of proceeds of such Collateral in satisfaction of such
Borrower’s obligations, to Lender under the Loan Documents).

 

(b)           Each Borrower shall be liable hereunder with respect to
the Obligations only for such total maximum amount (if any) that would not
render its Obligations hereunder or under any of the Loan Documents subject to
avoidance under Section 548 of the Bankruptcy Code or any comparable provisions
of any State law.

 

(c)           In order to provide for a fair and equitable contribution
among Borrowers in the event that any Contribution is made by an individual
Borrower (a “Funding Borrower”), such Funding Borrower shall be entitled to a
reimbursement Contribution (“Reimbursement Contribution”) from all other
Borrowers for all payments, damages and expenses incurred by that Funding
Borrower in discharging any of the Obligations, in the manner and to the extent
set forth in this Section 9.5.

 

(d)           For purposes hereof, the “Benefit Amount” of any
individual Borrower as of any date of determination shall be the net value of
the benefits to such Borrower and its Affiliates from extensions of credit made
by Lender to (a) such Borrower and (b) to the other Borrowers hereunder and the
Loan Documents to the extent such other Borrowers have guaranteed or mortgaged
their Properties to secure the Obligations of such Borrower to Lender.

 

(e)           Each Borrower shall be liable to a Funding Borrower in an
amount equal to the greater of (A) the (i) ratio of the Benefit Amount of such
Borrower to the total

 

112

 

amount of Obligations, multiplied by (ii) the amount of Obligations
paid by such Funding Borrower, or (B) ninety-five percent (95%) of the excess
of the fair saleable value of the property of such Borrower over the total
liabilities of such Borrower (including the maximum amount reasonably expected to
become due in respect of contingent liabilities) determined as of the date on
which the payment made by a Funding Borrower is deemed made for purposes hereof
(giving effect to all payments made by other Funding Borrowers as of such date
in a manner to maximize the amount of such Contributions).

 

(f)            In the event that at any time there exists more than one
Funding Borrower with respect to any Contribution (in any such case, the “Applicable
Contribution”), then Reimbursement Contributions from other Borrowers pursuant
hereto shall be allocated among such Funding Borrowers in proportion to the
total amount of the Contribution made for or on account of the other Borrowers
by each such Funding Borrower pursuant to the Applicable Contribution. In the
event that at any time any Borrower pays an amount hereunder in excess of the
amount calculated pursuant to this Section 9.5, that Borrower shall be deemed
to be a Funding Borrower to the extent of such excess and shall be entitled to
a Reimbursement Contribution from the other Borrowers in accordance with the
provisions of this Section.

 

(g)           Each Borrower acknowledges that the right to Reimbursement
Contribution hereunder shall constitute an asset in favor of Borrower to which
such Reimbursement Contribution is owing.

 

(h)           No Reimbursement Contribution payments payable by a
Borrower pursuant to the terms of this Section 9.5 shall be paid until all
amounts then due and payable by all of Borrowers to Lender, pursuant to the
terms of the Loan Documents, are paid in full in Cash.  Nothing contained in this Section 9.5 shall
limit or affect in any way the Obligations of any Borrower to Lender under this
Note or any other Loan Documents.

 

(i)            Each Borrower waives:

 

(A)          any right to require Lender to proceed against any other Borrower
or any other person or to proceed against or exhaust any security held by
Lender at any time or to pursue any other remedy in Lender’s power before
proceeding against Borrower;

 

(B)           the defense of the statute of limitations in any action
against any other Borrower or for the collection of any indebtedness or the
performance of any obligation under the Loan;

 

(C)           any defense based upon any legal disability or other
defense of any other Borrower, any Guarantor of any other person or by reason
of the cessation or limitation of the liability of any other Borrower or any
Guarantor from any cause other than full payment of all sums payable under the
Note, this Agreement and any of the other Loan Documents;

 

(D)          any defense based upon any lack of authority of the
officers, directors, partners or agents acting or purporting to act on behalf
of any other

 

113

 

Borrower or any principal of any other Borrower or any defect in the
formation of any other Borrower or any principal of any other Borrower;

 

(E)           any defense based upon any statute or rule of law which
provides that the obligation of a surety must be neither larger in amount nor
in any other respects more burdensome than that of a principal;

 

(F)           any defense based upon any failure by Lender to obtain
collateral for the indebtedness or failure by Lender to perfect a lien on any
collateral;

 

(G)           presentment, demand, protest and notice of any kind;

 

(H)          any defense based upon any failure of Lender to give notice
of sale or other disposition of any collateral to any other Borrower or to any
other person or entity or any defect in any notice that may be given in
connection with any sale or disposition of any collateral;

 

(I)            any defense based upon any failure of Lender to comply
with Applicable Laws in connection with the sale or other disposition of any
collateral, including, without limitation, any failure of Lender to conduct a
commercially reasonable sale or other disposition of any collateral;

 

(J)            any defense based upon any election by Lender, in any
bankruptcy proceeding, of the application or non-application of Section
1111(6)(2) of the Bankruptcy Code or any successor statute;

 

(K)          any defense based upon any use of cash collateral under
Section 363 of the Bankruptcy Code;

 

(L)           any defense based upon any agreement or stipulation
entered into by Lender with respect to the provision of adequate protection in any
bankruptcy proceeding;

 

(M)         any defense based upon any borrowing or any grant of a
security interest under Section 364 of the Bankruptcy Code;

 

(N)          any defense based upon the avoidance of any security
interest in favor of Lender for any reason;

 

(O)          any defense based upon any bankruptcy, insolvency,
reorganization, arrangement, readjustment of debt, liquidation or dissolution
proceeding, including any discharge of, or bar or stay against collecting, all
or any of the obligations evidenced by the Note or owing under any of the Loan
Documents; and

 

(P)           any defense or benefit based upon Borrower’s, or any other
party’s, resignation of the portion of any obligation secured by the applicable

 

114

 

Security Instruments to be satisfied by any payment from any other
Borrower or any such party.

 

(j)            Each Borrower waives:

 

(A)          all rights and defenses arising out of an election of
remedies by Lender even though the election of remedies, such as nonjudicial
foreclosure with respect to security for the Loan or any other amounts owing
under the Loan Documents, has destroyed Borrower’s rights of subrogation and
reimbursement against any other Borrower;

 

(B)           all rights and defenses that Borrower may have because any
of Debt is secured by real property. This means, among other things: (i) Lender
may collect from Borrower without first foreclosing on any real or personal
property collateral pledged by any other Borrower, (ii) if Lender forecloses on
any real property collateral pledged by any other Borrower, (a) the amount of
the Debt may be reduced only by the price for which that collateral is sold at
the foreclosure sale, even if the collateral is worth more than the sale price,
(b) Lender may collect from Borrower even if any other Borrower, by foreclosing
on the real property collateral, has destroyed any right Borrower may have to
collect from any other Borrower. This is an unconditional and irrevocable
waiver of any rights and defenses Borrower may have because any of the Debt is
secured by real property; and

 

(C)           any claim or other right which Borrower might now have or
hereafter acquire against any other Borrower or any other person that arises
from the existence or performance of any obligations under the Note, this
Agreement, the Security Instruments or the other Loan Documents, including,
without limitation, any of the following: (i) any right of subrogation,
reimbursement, exoneration, contribution, or indemnification; or (ii) any right
to participate in any claim or remedy of Lender against any other Borrower or
any collateral security therefor, whether or not such claim, remedy or right
arises in equity or under contract, statute or common law.

 

(D)          Any rights of Borrower of subrogation, reimbursement,
indemnification, and/or contribution against any other Borrower or any other
person or entity, and any other rights and defenses that are or may become
available to any Borrower or any other person or entity by reasons of Sections
2787-2855, inclusive of the California Civil Code;

 

(E)           Any rights or defenses that may be available by reason of
any election of remedies by any Borrower (including, without limitation, any
such election which in any manner impairs, effects, reduces, releases, destroys
or extinguishes any Borrower’s subrogation rights, rights to proceed against
any other Borrower for reimbursement, or any other rights of Borrowers to
proceed against any other person, entity or security, including but not limited
to any defense based upon an election of remedies by any Borrower under the
provisions

 

115

 

of Section 580(d) of the California Code of Civil Procedure or any
similar law of California or of any other State or of the United Sates); and

 

(F)           Any rights or defenses Borrower may have because the
Obligations are secured by real property or any estate for years.  These rights or defenses include, but are not
limited to, any rights or defenses that are based upon, directly or indirectly,
the application of Section 580(a), Section 580(b), Section 580(d) or Section
726 of the California Code of Civil Procedure to the Obligations.

 

X.            MISCELLANEOUS

 

Section
10.1         Survival.

 

This Agreement and all
covenants, agreements, representations and warranties made herein and in the
certificates delivered pursuant hereto shall survive the making by Lender of
the Loan and the execution and delivery to Lender of the Note, and shall
continue in full force and effect so long as all or any of the Debt is
outstanding and unpaid unless a longer period is expressly set forth herein or
in the other Loan Documents.  Whenever in
this Agreement any of the parties hereto is referred to, such reference shall
be deemed to include the legal representatives, successors and assigns of such
party.  All covenants, promises and
agreements in this Agreement, by or on behalf of Borrower, shall inure to the
benefit of the legal representatives, successors and assigns of Lender.

 

Section
10.2         Lender’s Discretion.

 

Whenever pursuant to this
Agreement, 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 whether arrangements or terms are
satisfactory or not satisfactory shall (except as is otherwise specifically
herein provided) be in the sole discretion of Lender and shall be final and
conclusive.

 

Section
10.3         Governing Law.

 

(a)           THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT ENTERED
INTO PURSUANT TO THE LAWS OF THE STATE OF NEW YORK AND SHALL IN ALL RESPECTS BE
GOVERNED, CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK (WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS), PROVIDED
HOWEVER, THAT WITH RESPECT TO THE CREATION, PERFECTION, PRIORITY AND
ENFORCEMENT OF THE LIENS AND SECURITY INTERESTS CREATED BY THIS AGREEMENT, THE
SECURITY INSTRUMENTS AND THE OTHER LOAN DOCUMENTS, AND THE DETERMINATION OF
DEFICIENCY JUDGMENTS, THE LAWS OF THE STATE WHERE EACH INDIVIDUAL PROPERTY IS
LOCATED SHALL APPLY.

 

(b)           WITH RESPECT TO ANY CLAIM OR ACTION ARISING HEREUNDER OR
UNDER THIS AGREEMENT, THE NOTE, OR THE OTHER

 

116

 

LOAN DOCUMENTS, BORROWER (A) IRREVOCABLY SUBMITS TO THE NONEXCLUSIVE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE UNITED STATES
DISTRICT COURT LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK, NEW YORK, AND
APPELLATE COURTS FROM ANY THEREOF, AND (B) IRREVOCABLY WAIVES ANY OBJECTION
WHICH IT MAY HAVE AT ANY TIME TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTE OR THE OTHER
LOAN DOCUMENTS BROUGHT IN ANY SUCH COURT, AND IRREVOCABLY WAIVES ANY CLAIM THAT
ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM.  NOTHING IN
THIS AGREEMENT, THE NOTE OR THE OTHER LOAN DOCUMENTS WILL BE DEEMED TO PRECLUDE
LENDER FROM BRINGING AN ACTION OR PROCEEDING WITH RESPECT HERETO IN ANY OTHER
JURISDICTION.

 

Section
10.4         Modification, Waiver
in Writing.

 

No modification, amendment,
extension, discharge, termination or waiver of any provision of this Agreement,
the Note, or of any other Loan Document, nor consent to any departure by
Borrower therefrom, shall in any event be effective unless the same shall be in
a writing signed by the party against whom enforcement is sought, and then such
waiver or consent shall be effective only in the specific instance, and for the
purpose, for which given.  Except as
otherwise expressly provided herein, no notice to, or demand on Borrower, shall
entitle Borrower to any other or future notice or demand in the same, similar
or other circumstances.

 

Section
10.5         Delay Not a Waiver.

 

Neither any failure nor any
delay on the part of Lender in insisting upon strict performance of any term,
condition, covenant or agreement, or exercising any right, power, remedy or
privilege hereunder, or under the Note or under any other Loan Document, or any
other instrument given as security therefor, shall operate as or constitute a
waiver thereof, nor shall a single or partial exercise thereof preclude any
other future exercise, or the exercise of any other right, power, remedy or
privilege.  In particular, and not by way
of limitation, by accepting payment after the due date of any amount payable
under this Agreement, the Note or any other Loan Document, Lender shall not be
deemed to have waived any right either to require prompt payment when due of
all other amounts due under this Agreement, the Note or the other Loan Documents,
or to declare a default for failure to effect prompt payment of any such other
amount.

 

Section
10.6         Notices.

 

All notices or other written
communications hereunder shall be deemed to have been properly given (i) upon
delivery, if delivered in person or by facsimile transmission with receipt
acknowledged by the recipient thereof and confirmed by telephone by sender,
(ii) one (1) Business Day after having been deposited for overnight delivery
with any reputable overnight courier service, or (iii) three (3) Business Days
after having been deposited in any post office or

 

117

 

mail depository regularly
maintained by the U.S. Postal Service and sent by registered or certified mail,
postage prepaid, return receipt requested, addressed as follows:

 

	
  If to Borrower:

  	
  c/o Spirit Finance Corporation

  
	
   

  	
  14631 N. Scottsdale Road, Suite 200

  
	
   

  	
  Scottsdale, Arizona 85254

  
	
   

  	
  Attention: Catherine Long

  Facsimile No: 480-606-0826

  
	
   

  	
   

  
	
   

  	
   

  
	
  With a copy to:

  	
  Kutak Rock LLP

  
	
   

  	
  1801 California Street, Suite 3100

  
	
   

  	
  Denver CO 80202

  
	
   

  	
  Attention: Paul E. Belitz,
  Esq.

  
	
   

  	
  Facsimile No.: (303) 292-7799

  
	
   

  	
   

  
	
  If to Lender:

  	
  Barclays Capital Real Estate Inc.

  
	
   

  	
  200 Park Avenue

  
	
   

  	
  New York, New York 10166

  
	
   

  	
  Attn.: Lori Rung /CMBS Servicing

  Facsimile No.: (212) 412-1621

  
	
   

  	
   

  
	
   

  	
  and

  
	
   

  	
   

  
	
   

  	
  Citigroup Global Markets Realty Corp.

  
	
   

  	
  388 Greenwich Street

  
	
   

  	
  New York, New York 10013

  
	
   

  	
  Attn: Phil Holmes

  Facsimile No.: 212-816-2880

  
	
   

  	
   

  
	
  With a copy to:

  	
  Thacher Proffitt & Wood LLP

  
	
   

  	
  Two World Financial Center

  New York, New York 10281

  
	
   

  	
  Attention: David S. Hall, Esq.

  
	
   

  	
  Facsimile No.: (212) 912-7751

  

 

or addressed as such party
may from time to time designate by written notice to the other parties.

 

Either party by notice to
the other may designate additional or different addresses for subsequent
notices or communications.

 

118

 

Section
10.7         Trial by Jury.

 

BORROWER HEREBY AGREES NOT
TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY
RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR
HEREAFTER EXIST WITH REGARD TO THE LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM
OR OTHER ACTION ARISING IN CONNECTION THEREWITH.  THIS WAIVER OF RIGHT TO TRIAL BY JURY IS
GIVEN KNOWINGLY AND VOLUNTARILY BY BORROWER, AND IS INTENDED TO ENCOMPASS
INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY
JURY WOULD OTHERWISE ACCRUE.  LENDER IS
HEREBY AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS
CONCLUSIVE EVIDENCE OF THIS WAIVER BY BORROWER.

 

Section
10.8         Headings.

 

The Article and/or Section
headings and the Table of Contents in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose.

 

Section
10.9         Severability.

 

Wherever possible, each
provision of this Agreement shall be interpreted in such manner as to be
effective and valid under Applicable Law, but if any provision of this
Agreement shall be prohibited by or invalid under Applicable Law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining
provisions of this Agreement.

 

Section
10.10       Preferences.

 

Lender shall have the
continuing and exclusive right to apply or reverse and reapply any and all
payments by Borrower to any portion of the obligations of Borrower
hereunder.  To the extent Borrower makes
a payment or payments to Lender, which payment or proceeds or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required to be repaid to a trustee, receiver or any other party under
any bankruptcy law, State or federal law, common law or equitable cause, then,
to the extent of such payment or proceeds received, the obligations hereunder
or part thereof intended to be satisfied shall be revived and continue in full
force and effect, as if such payment or proceeds had not been received by
Lender.

 

Section
10.11       Waiver of Notice.

 

Borrower shall not be
entitled to any notices of any nature whatsoever from Lender except with
respect to matters for which this Agreement or the other 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.  Borrower hereby expressly waives the right to
receive any notice from Lender with respect to any matter for which this
Agreement or the other Loan

 

119

 

Documents do not
specifically and expressly provide for the giving of notice by Lender to
Borrower.

 

Section
10.12       Remedies of
Borrower.

 

In the event that a claim or
adjudication is made that Lender or its agents have acted unreasonably or
unreasonably delayed acting in any case where by law or under this Agreement or
the other Loan Documents, Lender or such agent, as the case may be, has an
obligation to act reasonably or promptly, Borrower agrees that neither Lender
nor its agents shall be liable for any monetary damages, and Borrower’s sole
remedies shall be limited to commencing an action seeking injunctive relief or
declaratory judgment.  The parties hereto
agree that any action or proceeding to determine whether Lender has acted
reasonably shall be determined by an action seeking declaratory judgment.

 

Section 10.13       Expenses; Indemnity.

 

(a)           Borrower covenants and agrees to pay or, if Borrower fails
to pay, to reimburse, Lender within fifteen (15) days of receipt of written
notice from Lender for all reasonable costs and expenses (including reasonable
attorneys’ fees and disbursements) incurred by Lender in connection with: (i)
the negotiation, preparation, execution, delivery and administration of any
consents, amendments, waivers or other modifications to this Agreement and the
other Loan Documents and any other documents or matters requested by Lender;
(ii) securing Borrower’s compliance with any requests made pursuant to the provisions
of this Agreement; (vi) the filing and recording fees and expenses, cost of title
insurance and reasonable fees and expenses of counsel for providing to Lender
all required legal opinions, and other similar expenses incurred in creating
and perfecting the Liens in favor of Lender pursuant to this Agreement and the
other Loan Documents; (iii) enforcing or preserving any rights, in response to
third party claims or the prosecuting or defending of any action or proceeding
or other litigation, in each case against, under or affecting Borrower, this
Agreement, the other Loan Documents, the Properties, or any other security
given for the Loan; and (iv) enforcing any obligations of or collecting any
payments due from Borrower under this Agreement, the other Loan Documents or
with respect to the Properties or in connection with any refinancing or
restructuring of the credit arrangements provided under this Agreement in the
nature of a “work-out” or of any insolvency or bankruptcy proceedings;
provided, however, that Borrower shall not be liable for the payment of any
such costs and expenses to the extent the same arise by reason of the gross
negligence, illegal acts, fraud or willful misconduct of Lender.  Any cost and expenses due and payable to
Lender may be paid from any amounts in the Lockbox Account.

 

(b)           Borrower shall indemnify, defend and hold harmless Lender
from and against any and all other liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, claims, costs, expenses and disbursements
of any kind or nature whatsoever (including, without limitation, the reasonable
fees and disbursements of counsel for Lender in connection with any
investigative, administrative or judicial proceeding commenced or threatened,
whether or not Lender shall be designated a party thereto), that are imposed on
or incurred by Lender in any manner relating to or arising

 

120

 

out of (i) any breach by Borrower of its obligations under this
Agreement or the other Loan Documents, or (ii) the use or intended use of the
proceeds of the Loan (collectively, the “Additional Indemnified Liabilities”);
provided, however, that Borrower shall not have any obligation to Lender
hereunder to the extent that such Additional Indemnified Liabilities arise from
the gross negligence, illegal acts, fraud or willful misconduct of Lender.  To the extent that the undertaking to
indemnify, defend and hold harmless set forth in the preceding sentence may be unenforceable
because it violates any law or public policy, Borrower shall pay the maximum
portion that it is permitted to pay and satisfy under Applicable Law to the
payment and satisfaction of all Additional Indemnified Liabilities incurred by
Lender.

 

(c)           Borrower shall, at its sole cost and expense, protect,
defend, indemnify, release and hold harmless Lender and the Indemnified Parties
from and against any and all losses (including, without limitation, reasonable
attorneys’ fees and costs incurred in the investigation, defense, and
settlement of losses incurred in correcting any prohibited transaction or in
the sale of a prohibited loan, and in obtaining any individual prohibited
transaction exemption under ERISA, the Code, any State statute or other similar
law that may be required, in Lender’s sole discretion) that Lender actually
incurs as a result of a default under Sections 4.1.8 or 5.2.8 hereof.

 

(d)           Borrower covenants and agrees to pay for or, if Borrower
fails to pay, to reimburse Lender for, any consent, approval, waiver or
confirmation obtained from such Rating Agency pursuant to the terms and
conditions of this Agreement or any other Loan Document and Lender shall be
entitled to require payment of such fees and expenses as a condition precedent
to the obtaining of any such consent, approval, waiver or confirmation.

 

Section
10.14       Schedules and
Exhibits Incorporated.

 

The Schedules and Exhibits
annexed hereto are hereby incorporated herein as a part of this Agreement with
the same effect as if set forth in the body hereof.

 

Section
10.15       Offsets,
Counterclaims and Defenses.

 

Any assignee of Lender’s
interest in and to this Agreement, the Note and the other Loan Documents shall
take the same free and clear of all offsets, counterclaims or defenses which
are unrelated to such documents which Borrower may otherwise have against any
assignor of such documents, 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 such documents 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 10.16       No Joint Venture or
Partnership; No Third Party Beneficiaries.

 

(a)           Borrower and Lender intend that the relationships created
hereunder and under the other Loan Documents be solely that of borrower and
lender.  Nothing herein or therein is
intended to create a joint venture, partnership, tenancy-in-common, or joint

 

121

 

tenancy relationship between Borrower and Lender nor to grant Lender
any interest in the Properties other than that of mortgagee, beneficiary or
lender.

 

(b)           This Agreement and the other Loan Documents are solely for
the benefit of Lender and Borrower and nothing contained in this Agreement or
the other Loan Documents shall be deemed to confer upon anyone other than
Lender and Borrower any right to insist upon or to enforce the performance or
observance of any of the obligations contained herein or therein.  All conditions to the obligations of Lender
to make the Loan hereunder are imposed solely and exclusively for the benefit
of Lender and no other Person shall have standing to require satisfaction of
such conditions in accordance with their terms or be entitled to assume that
Lender will refuse to make the Loan in the absence of strict compliance with
any or all thereof and no other Person shall under any circumstances be deemed
to be a beneficiary of such conditions, any or all of which may be freely
waived in whole or in part by Lender if, in Lender’s sole discretion, Lender
deems it advisable or desirable to do so.

 

Section
10.17       Publicity.

 

Other than in connection
with a Securitization, all news releases, publicity or advertising by Borrower
or its Affiliates through any media intended to reach the general public which
refers to the Loan Documents or the financing evidenced by the Loan Documents,
to Lender, Barclays, Citi or any of their Affiliates shall be subject to the
prior written approval of Lender and Borrower, which shall not be unreasonably
withheld.  Notwithstanding the foregoing,
disclosure required by any federal or State securities laws, rules or
regulations, as determined by Borrower’s counsel, shall not be subject to the
prior written approval of Lender.

 

Section 10.18       Cross-Default;
Cross-Collateralization; Waiver of Marshalling of Assets. 

 

(a)           Borrower acknowledges that Lender has made the Loan to
Borrower upon the security of its collective interest in the Properties and in
reliance upon the aggregate of the Properties taken together being of greater
value as collateral security than the sum of each Individual Property taken
separately.  Borrower agrees that the
Security Instruments are and will be cross-collateralized and cross-defaulted
with each other so that (i) an Event of Default under any of the Security
Instruments shall constitute an Event of Default under each of the other
Security Instruments which secure the Note; (ii) an Event of Default under the
Note or this Agreement shall constitute an Event of Default under each Security
Instrument; (iii) each Security Instrument shall constitute security for the
Note as if a single blanket lien were placed on all of the Properties as
security for the Note; and (iv) such cross-collateralization shall in no event
be deemed to constitute a fraudulent conveyance.

 

(b)           To the fullest extent permitted by Applicable
Law, Borrower, for itself and its successors and assigns, waives all rights to
a marshalling of the assets of Borrower, Borrower’s partners and others with
interests in Borrower, and of the Properties, or to a sale in inverse order of
alienation in the event of foreclosure of all or any of the Security
Instruments, and agrees not to assert any right under any laws pertaining to
the marshalling of assets, the sale in inverse order of alienation, homestead
exemption, the

 

122

 

administration of estates of decedents, or any other matters whatsoever
to defeat, reduce or affect the right of Lender under the Loan Documents to a
sale of the Properties for the collection of the Debt without any prior or
different resort for collection or of the right of Lender to the payment of the
Debt out of the net proceeds of the Properties in preference to every other
claimant whatsoever.  In addition,
Borrower, for itself and its successors and assigns, waives in the event of
foreclosure of any or all of the Security Instruments, any equitable right
otherwise available to Borrower which would require the separate sale of the
Properties or require Lender to exhaust its remedies against any Individual
Property or any combination of the Properties before proceeding against any
other Individual Property or combination of Properties; and further in the
event of such foreclosure Borrower does hereby expressly consents to and
authorizes, at the option of Lender, the foreclosure and sale either separately
or together of any combination of the Properties.

 

Section
10.19       Waiver of Counterclaim.

 

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.

 

Section
10.20       Conflict;
Construction of Documents; Reliance.

 

In the event of any conflict
between the provisions of this Agreement and any of the other Loan Documents,
the provisions of this Agreement shall control. 
The parties hereto acknowledge that they were represented by competent counsel
in connection with the negotiation, drafting and execution of the Loan
Documents and that such Loan Documents shall not be subject to the principle of
construing their meaning against the party which drafted same.  Borrower acknowledges that, with respect to
the Loan, Borrower shall rely solely on its own judgment and advisors in
entering into the Loan without relying in any manner on any statements,
representations or recommendations of Lender or any parent, subsidiary or
Affiliate of Lender.  Lender shall not be
subject to any limitation whatsoever in the exercise of any rights or remedies
available to it under any of the Loan Documents or any other agreements or
instruments which govern the Loan by virtue of the ownership by it or any
parent, subsidiary or Affiliate of Lender of any equity interest any of them
may acquire in Borrower, and Borrower hereby irrevocably waives the right to
raise any defense or take any action on the basis of the foregoing with respect
to Lender’s exercise of any such rights or remedies.  Borrower acknowledges that Lender engages in
the business of real estate financings and other real estate transactions and
investments which may be viewed as adverse to or competitive with the business
of Borrower or its Affiliates.

 

Section
10.21       Brokers and
Financial Advisors.

 

Other than Citi, Borrower
hereby represents that it has dealt with no financial advisors, brokers,
underwriters, placement agents, agents or finders in connection with the
transactions contemplated by this Agreement. 
Borrower hereby agrees to indemnify, defend and hold Lender harmless
from and against any and all claims, liabilities, costs and expenses of any
kind (including Lender’s reasonable attorneys’ fees and expenses) in any way
relating to or arising from a claim by any Person that such Person acted on behalf
of Borrower or Lender in

 

123

 

connection with the
transactions contemplated herein.  The
provisions of this Section 10.21 shall survive the expiration and termination
of this Agreement and the payment of the Debt.

 

Section
10.22       Prior Agreements.

 

This Agreement and the other
Loan Documents contain the entire agreement of the parties hereto and thereto
in respect of the transactions contemplated hereby and thereby, and all prior
agreements among or between such parties, whether oral or written, between
Borrower and/or its Affiliates and Lender are superseded by the terms of this
Agreement and the other Loan Documents.

 

[NO
FURTHER TEXT ON THIS PAGE]

 

124

 

IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed by their duly authorized representatives,
all as of the day and year first above written.

 

	
   

  	
  BORROWER

  
	
   

  	
   

  
	
   

  	
  SPIRIT SPE PORTFOLIO 2006-1, LLC

  
	
   

  	
  a
  Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Michael T. Bennett

  	
   

  
	
   

  	
   

  	
  Name:
   Michael T. Bennett

  
	
   

  	
   

  	
  Title:
   Senior Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SPIRIT SPE PORTFOLIO 2006-2, LLC

  
	
   

  	
  a
  Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Michael T. Bennett

  	
   

  
	
   

  	
   

  	
  Name:
   Michael T. Bennett

  
	
   

  	
   

  	
  Title:
   Senior Vice President

  

 

125

 

	
   

  	
  LENDER:

  
	
   

  	
   

  
	
   

  	
  BARCLAYS CAPITAL REAL ESTATE INC., a

  Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ LoriAnn Rung

  	
   

  
	
   

  	
   

  	
  Name:  LoriAnn Rung

  
	
   

  	
   

  	
  Title:  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CITIGROUP GLOBAL MARKETS REALTY

  CORP., a New York
  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jay Dewaltoff

  	
   

  
	
   

  	
   

  	
  Name:  Jay Dewaltoff

  
	
   

  	
   

  	
  Title:  Authorized Agent

  

 

126

 

SCHEDULE I

 

Properties - Allocated Loan
Amounts

 

127

 

SCHEDULE II

 

Required Repairs

 

128

 

SCHEDULE III

 

Organizational Chart of
Borrower

 

129

 

SCHEDULE IV

 

Ground Leases

 

130

 

SCHEDULE V

 

Out-Parcels

 

131

 

SCHEDULE VI

 

Intentionally Omitted

 

132

 

SCHEDULE VII

 

Immaterial Leases

 

133

 

SCHEDULE VIII

 

Intentionally Omitted

 

134

 

SCHEDULE IX

 

Exceptions to Article 4
Reps: Litigation and Condemnation Matters

 

135

 

EXHIBIT A

 

Borrower

 

Spirit SPE Portfolio 2006-1,
a Delaware limited liability company (“Spirit 1”)

 

Spirit 1 State
Organizational Identification Number: 4082092

 

Spirit 1 TIN Number: 204032314

 

Spirit
SPE Portfolio 2006-2, a Delaware limited liability company (“Spirit 2”)

 

Spirit 2 State
Organizational Identification Number: 4091342

 

Spirit
2 TIN Number: 204094866

 

136

 

EXHIBIT B

 

ShopKo Properties

 

137

 

EXHIBIT C

 

Form of P&L Report

 

138

 

EXHIBIT D

 

Form of SNDA

 

139

 

EXHIBIT E

 

Form of Confidentiality
Agreement

 

140

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