Document:

EX-10.5

Prepared by, and after recording return

to:

J. Lindsay Stradley, Jr.

Epstein Becker & Green, P.C.

945 East Paces Ferry Road, Suite 2700

Atlanta, Georgia 30326

DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE

FILING

BRAEMAR HOUSING LIMITED PARTNERSHIP,

an Ohio limited partnership,

Borrower,

having an office at

3103 Camden Drive

Troy, Michigan 48084

To

J. LINDSAY STRADLEY, JR.,

Trustee

for the benefit of

TRANSAMERICA OCCIDENTAL LIFE INSURANCE COMPANY,

an Iowa corporation,

Lender,

having an office

c/o AEGON USA Realty Advisors, Inc.

4333 Edgewood Road, N.E.

Cedar Rapids, Iowa 52499-5443

[COLLATERAL IS OR INCLUDES FIXTURES]

Loan Amount: $10,000,000.00

Premises: Residences at Braemar, Mecklenburg County, Charlotte, North Carolina

1

Deed of Trust, Security Agreement and Fixture Filing

This Deed of Trust Security Agreement and Fixture Filing (this “Deed of Trust”) is made and
given as of the 25th day of May, 2005, by BRAEMAR HOUSING LIMITED PARTNERSHIP,
an Ohio limited partnership, as Grantor, whose address is 3103 Camden Drive, Troy, Michigan 48084
(the “Borrower”), to J. LINDSAY STRADLEY, JR., as Trustee, whose address is 945 East Paces Ferry
Road, Suite 2700, Atlanta, Georgia 30326-1380 (together with his successors and assigns, the
“Trustee”), for the benefit of TRANSAMERICA OCCIDENTAL LIFE INSURANCE COMPANY, an Iowa corporation,
as Beneficiary, having an office c/o AEGON USA Realty Advisors, Inc., 4333 Edgewood Road, N.E.,
Cedar Rapids, Iowa 52499-5443 (the “Lender”). The definitions of capitalized terms used in this
Deed of Trust may be found either in Section 3 below, through the cross-references provided in that
Section, or in Section 22 below.

1. RECITALS

	 	A.	 	Under the terms of a Revised Loan Application/Commitment dated March 16,
2005, as amended (the Commitment”), AEGON USA Realty Advisors, Inc. (“AEGON”), as
agent for the Lender, agreed to fund a loan in an original principal amount to be
determined in accordance with procedures described in the Commitment (the “Loan”).

	 	B.	 	The Lender has funded the Loan in the principal amount of $10,000,000 in
accordance with the Commitment, and to evidence the Loan, the Borrower has executed
and delivered to the Lender a certain Secured Promissory Note, of even date, in the
amount of $10,000,000, with a maturity and final payment date of June 1,2015.

	 	C.	 	The Commitment requires that the Loan be secured by all of the Borrower’s
existing and after-acquired interest in certain real property and by certain tangible
and intangible personal property.

2. GRANTING CLAUSE

To secure the repayment of the Indebtedness, any increases, modifications, renewals or
extensions of the Indebtedness, and any substitutions for the Indebtedness, as well as the
performance of the Borrower’s other Obligations, and in consideration of the sum of ten
dollars ($10.00) and other valuable consideration, the receipt and sufficiency of which are
acknowledged, the Borrower grants, bargains, warrants, conveys, alienates, releases,
Assigns, sets over and confirms to the Trustee, in trust with the power of sale for the
benefit of the Lender and to his successors and assigns forever, all of the Borrower’s
existing and after-acquired interests in the Real Property, TO HAVE AND TO HOLD the Real
Property and all parts, rights, members and appurtenances thereof, to the use, benefit and
behalf of the Lender and its successors and assigns, IN FEE SIMPLE forever.

3. DEFINED TERMS

The following defined terms are used in this Deed of Trust. For ease of reference, terms
relating primarily to the Security Agreement are defined in Subsection 22.1.

"Absolute Assignment of Leases and Rents” means the Loan Document bearing this
heading.

"Appurtenances” means all rights, estates, titles, interests, privileges,
easements, tenements, hereditaments, titles, royalties, reversions, remainders and other
interests, whether presently held by the Borrower or acquired in the future, that may be
conveyed as interests in the Land under the laws of North Carolina. Appurtenances include
the Easements and the Assigned Rights.

"Assigned Rights” means all of the Borrower’s rights, easements, privileges,
tenements, hereditaments, contracts, claims, licenses or other interests, whether presently
existing or arising in the future. The Assigned Rights include all of the Borrower’s rights
in and to:

(a) any greater estate in the Real Property;

	 	(b)	 	insurance policies required to be carried hereunder,
including the right to negotiate claims and to receive Insurance Proceeds and
unearned insurance premiums (except as expressly provided in Subsection 8.1);

	 	(c)	 	Condemnation Proceeds, provided that the award does not
reduce, directly or indirectly, the award to the owner of the Real Property;

	 	(d)	 	licenses and agreements permitting the use of sources of
groundwater or water utilities, septic leach fields, railroad sidings, sewer
lines, or means of ingress and egress;

(e) drainage over other property;

(f) air space above the Land;

(g) mineral rights;

(h) party walls;

(i) vaults and their usage;

(j) franchises;

	 	(k)	 	commercial tort claims that arise during the Loan term in
respect of damages to the Real Property or to its operations, in respect of
any impairment to the value of the Real Property, or in respect of the
collection of any Rents;

(l) construction contracts;

(m) roof and equipment guarantees and warranties;

(n) building and development licenses and permits;

	 	(o)	 	tax credits or other governmental entitlements, credits or
rights, whether or not vested;

(p) licenses and applications (whether or not yet approved or issued);

(q) rights under management and service contracts;

(r) leases of Fixtures; and

	 	(s)	 	trade names, trademarks, trade styles, service marks,
copyrights, and agreements with architects, environmental consultants,
property tax consultants, engineers, and any other third-party contractors
whose services benefit the Real Property.

"Bankruptcy Code” shall mean the Bankruptcy Reform Act of 1978, as amended,
11U.S.C. Sections 101 et seq., and the regulations promulgated pursuant to those statutes.

"Business Day” means any day when state and federal banks are open for business in
Cedar Rapids, Iowa.

"Carveout Guarantee and Indemnity” means that certain “Carveout Guarantee and
Indemnity Agreement” entered into by the Carveout Obligors on the date of this Deed of
Trust.

"Carveout Obligations” means those obligations described in Section 21.

"Carveout Obligors” means Phillip I. Levin, Joseph J. Recchie, Bradley J. Schram,
and Norman A. Pappas. Any other person who expressly assumes liability for the Carveout
Obligations during the term of the Loan shall become a “Carveout Obligor” for purposes of
this Deed of Trust.

"Carvwuts” means those matters from which Carveout Obligations may arise, which are
described in Section 21.

"Condemnation Proceeds” means all money or other property that has been, or is in
the future, awarded or agreed to be paid or given in connection with any taking by eminent
domain of all or any part of the Real Property (including a taking through the vacation of
any street dedication or through a change of grade of such a street), either permanent or
temporary, or in connection with any purchase in lieu of such a taking, or as a part of any
related settlement, except for the right to condemnation proceeds awarded to the tenant in
a separate proceeding in respect of the lost value of the tenant’s leasehold interest,
provided that the award does not reduce, directly or indirectly, the award to the owner of
the Real Property.

"Curable Nonmonetarv Default” means any of the acts, omissions, or circumstances
specified in Subsection 10.3 below.

"Default” means any of the acts, omissions, or circumstances specified in Section 10
below.

"Default Rate” means the rate of interest specified as the “Default Rate” in the Note.

"Development Agreements” means all development, utility or similar agreements
included in the Permitted Encumbrances.

"Easements” means the Borrower’s existing and future interests in and to the
declarations, easements, covenants, and restrictions appurtenant to the Land.

"Environmental Indemnity Agreement” means the Loan Document bearing that heading.

"Environmental Laws” means all present and future laws, statutes, ordinances,
rules, regulations, orders, guidelines, rulings, decrees, notices and determinations of any
Governmental Authority to the extent that they pertain to: (A) the protection of health
against environmental hazards; (B) the protection of the environment, including air, soils,
wetlands, and surface and underground water, from contamination by any substance that may
have any adverse health effect on humans, livestock, fish, wildlife, or plant life, or
which may disturb an ecosystem; (C) underground storage tank regulation or removal; (D)
wildlife conservation; (E) protection or regulation of natural resources; (F) the
protection of wetlands; (G) management, regulation and disposal of solid and hazardous
wastes; (H) radioactive materials; (I) biologically hazardous materials; (0 indoor air
quality; or (K) the manufacture, possession, presence, use, generation, storage,
transportation, treatment, release, emission, discharge, disposal, abatement, cleanup,
removal, remediation or handling of any Hazardous Substances. “Environmental Laws” include
the Comprehensive Environmental Response, Compensation, and Liability Act, as amended by
the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §9601 et
seq., the Resource Conservation and Recovery Act, 42 U.S.C. §6901 et seq., the
Federal Water Pollution Control Act, as amended by the Clean Water Act, 33 U.S.C.
§1251 et seq., the Clean Air Act, 42 U.S.C. $7401 et seq., the Toxic Substances
Control Act, 15 U.S.C. $2601 et seq., all similar state statutes and local ordinances, and
all regulations promulgated under any of those statutes, and all administrative and
judicial actions respecting such legislation, all as amended from time to time.

“ESA” means the written environmental site assessment of the Real Property obtained
under the terms of the Commitment.

"Escrow Expenses” means those expenses in respect of real and personal property
taxes and assessments, Insurance Premiums and such other Impositions as the Lender pays
from time to time directly from the Escrow Fund using monies accumulated through the
collection of Monthly Escrow Payments.

"Escrow Fund” means the funds deposited by Borrower with the Lender pursuant to
Section 9 hereof, as reflected in the accounting entry maintained on the books of the
Lender as funds available for the payment of Escrow Expenses under the terms of this Deed
of Trust.

“Fixtures” means all materials, supplies, equipment, apparatus and other items now
or hereafter attached to or installed on the Land and Improvements in a manner that causes
them to become fixtures under the laws of North Carolina, including all built-in or
attached furniture or appliances, elevators, escalators, heating, ventilating and air
conditioning system components, emergency electrical generators and related fuel storage or
delivery systems, septic system components, storm windows, doors, electrical equipment,
plumbing, water conditioning, lighting, cleaning, snow removal, lawn, landscaping,
irrigation, security, incinerating, fire-fighting, sprinkler or other fire safety
equipment, bridge cranes or other installed materials handling equipment, satellite dishes
or other telecommunication equipment, built-in video wnferencing equipment, sound systems
or other audiovisual equipment, and cable television distribution systems. Fixtures do not
include trade fixtures, office furniture and office equipment owned by tenants who are
unrelated to the Borrower. Fixtures expressly include HVAC, mechanical, security and
similar systems of general utility for the operation of the Improvements as leasable
commercial real property.

"Governmental Authority” means any political entity with the legal authority to
impose any requirement on the Property, including the governments of the United States, the
State of North Carolina, Mecklenburg County, the City of Charlotte, and any other entity
with jurisdiction to decide, regulate, or affect the ownership, construction, use,
occupancy, possession, operation, maintenance, alteration, repair, demolition or
reconstruction of any portion or element of the Real Property.

"Guarantors” means Phillip I. Levin, Joseph J. Recchie, Bradley J. Schram and
Norman A. Pappas.

"Hazardous Substance” means any substance the release of or the exposure to which
is prohibited, limited or regulated by any Environmental Law, or which poses a hazard to
human health, including: (A) any “oil,” as defined by the Federal Water Pollution Control
Act and regulations promulgated thereunder (including crude oil or any fraction of crude
oil), (B) any radioactive substance and (C) Stacchybotris chartarum or other molds.
However, the term “Hazardous Substance” includes neither (A) a substance used in the
cleaning and maintenance of the Real Property, if the quantity, storage and manner of its
use are customary, prudent, and do not violate applicable law, nor (B) automotive motor oil
in immaterial quantities, if leaked from vehicles in the ordinary course of the operation
of the Real Property and cleaned up in accordance with reasonable property management
procedures and in a manner that violates no applicable law.

"Impositions” means all real and personal property taxes levied against the
Property; general or special assessments; ground rent; water, gas, sewer, vault, electric
or other utility charges; common area charges; owners’ association dues or fees; fees for
any easement, license or agreement maintained for the benefit of the Property; and any and
all other taxes, levies, user fees, claims, charges and assessments whatsoever that at any
time may be assessed, levied or imposed on the Property or upon its ownership, use,
occupancy or enjoyment, and any related costs, interest or penalties. In addition,
“Impositions” include all documentary, stamp or intangible personal property taxes that may
become due in connection with the Indebtedness, including Indebtedness in respect of any
future advance made by the Lender to the Borrower, or that are imposed on any of the Loan
Documents.

"Improvements” means, to the extent of the Borrower’s existing and future interest,
all buildings and improvements of any kind erected or placed on the Land now or in the
future, including the Fixtures, together with all appurtenant rights, privileges,
Easements, tenements, hereditaments, titles, reversions, remainders and other interests.
“Indebtedness” means all sums that are owed or become due pursuant to the terms of the
Note, this Deed of Trust, or any of the other Loan Documents or any other writing executed
by the Borrower relating to the Loan, including scheduled principal payments, scheduled
interest payments, default interest, late charges, prepayment premiums, accelerated or
matured principal balances, advances, collection costs (including reasonable attorneys’
fees), reasonable attorneys’ fees and costs in enforcing or protecting the Note, this Deed
of Trust, or any of the other Loan Documents in any probate, bankruptcy or other
proceeding, receivership costs, fees and costs of the Trustee and all other financial
obligations of the Borrower incurred in connection with the Loan transaction, provided,
however, that this Deed of Trust shall not secure any Loan Document or any particular
person’s liabilities or obligations under any Loan Document to the extent that such Loan
Document expressly states that it or such particular person’s liabilities or obligations
are unsecured by this Deed of Trust. Indebtedness shall also include any obligations under
agreements executed and delivered by Borrower which specifically provide that such
obligations are secured by this Deed of Trust.

"Insurance Premiums” means all premiums or other charges required to maintain in
force any and all insurance policies that this Deed of Trust requires that the Borrower
maintain.

"Insurance Proceeds” means (A) all proceeds of all insurance now or hereafter
carried by or payable to the Borrower with respect to the Real Property, including with
respect to the interruption of rents or income derived from the Property, all unearned
insurance premiums and all related claims or demands, and (B) all Proceeds (as defined in
Subsection 22.1).

“Land” means that certain tract of land located in Charlotte, Mecklenburg
County, North Carolina, which is described on the attached Exhibit A, together with the
Appurtenances.

“Leases” means all leases, subleases, licenses, concessions, extensions, renewals
and other agreements (whether written or oral, and whether presently effective or made in
the future) through which the Borrower grants any possessory interest in and to, or any
right to occupy or use, all or any part of the Real Property, and any related guaranties.

’’Legal Control” means the power, either directly or indirectly, to exercise the
authority of the owner of the Real Property, either as the majority shareholder of the
common stock of a corporation, as the sole general partner of a limited partnership, as the
managing general partner of a general partnership, or as the sole manager of a limited
liability company, provided the entity exercising such authority cannot be divested of such
authority without its consent, either directly or indirectly, except for cause.

"Legal Requirements” means all laws, statutes, rules, regulations, ordinances,
judicial decisions, administrative decisions, building permits, development permits,
certificates of occupancy, or other requirements of any Governmental Authority.

"Loan Documents” means all documents evidencing the Loan or delivered in connection
with the Loan, whether entered into at the closing of the Loan or in the future.

"Maximum Permitted Rate” means the highest rate of interest permitted to be paid or
collected by applicable law with respect to the Loan.

"Monthly Escrow Pavment” means the sum of the Monthly Imposition Requirement, the
Monthly Insurance Premium Requirement, and the Monthly Reserve Requirement.

"Monthly Imposition Requirement” means one-twelfth (11 12th) of the annual amount
that the Lender estimates will be required to permit the timely payment by the Lender of
those Impositions that the Lender elects, from time to time, to include in the calculation
of the Monthly Imposition Requirement. Such Impositions shall include real and personal
property taxes and may include, at the Lender’s sole and absolute discretion any
Impositions that the Borrower has failed to pay on a timely basis during the term of the
Loan. The Lender shall base its estimate on the most recent information supplied by the
Borrower concerning future Impositions. If the Borrower fails to supply such information or
if it is unavailable at the time of estimation, the Lender shall estimate future
Impositions using historical information and an annual inflation factor equal to the lesser
of five percent (5%) and the maximum inflation factor permitted by law.

"Monthly Insurance Premium Reauirement” means one-twelfth (1112th) of the annual
amount that the Lender estimates (based on available historical data and using, if future
Insurance Premiums are as yet undeterminable, a five percent (5%) inflation factor) will be
required to permit the timely payment of the Insurance Premiums by the Lender.

"Monthlv Reserve Reauirement” means the monthly payment amount which the Lender
estimates will, over the subsequent twelve (12) months, result in the accumulation of a
surplus in the Escrow Fund equal to the sum of the Monthly Imposition Requirement and the
Monthly Insurance Premium Requirement.

"Net Worth Reauirement” means the lesser of (i) the aggregate net worth of the
Carveout Obligors most recently represented to the Lender at the time of the approval of
the Loan by AEGON’s Investments Committee and (ii) the principal balance of the Loan at the
time of determination.

"Note” means the Secured Promissory Note dated of even date herewith to evidence
the Indebtedness in the original principal amount of $10,000,000, together with all
extensions, renewals and modifications.

“Notice” means a notice given in accordance with the provisions of Subsection
26.13.

"Oblieations” means all of the obligations required to be performed under the terms
and conditions of any of the Loan Documents by any Obligor, except for obligations that are
expressly stated to be unsecured under the terms of another Loan Document.

"Obligor” means the Borrower, any Carveout Obligor, any Guarantor, or any other
Person that is liable under the Loan Documents for the payment of any portion of the
Indebtedness, or the performance of any other obligation required to he performed under the
terms and conditions of any of the Loan Documents, under any circumstances.

"Particioations” means participation interests in the Loan Documents granted by the
Lender.

"Permitted Control Group Member” shall mean any member of a group comprised of
Phillip I. Levin, Bradley J. Schram, and Norman A. Pappas.

"Permitted Encumbrances” means (A) the lien of taxes and assessments not yet due
and payable and (B) those matters of public record listed as special exceptions or
subordinate matters in the Lender’s title insurance policy insuring the priority of this
Deed of Trust.

"Permitted Transfer” means a transfer specifically described in Section 14 as
permitted.

“Person” means any individual, corporation, limited liability company, partnership,
trust, unincorporated association, government, governmental authority or other entity.

"Prohibited Structural Change” means a change in the identity of any of the
entities through which the Permitted Control Group Members exercise Legal Control over the
Real Property, or a change in the capacity through which any Permitted Control Group Member
exercises such Legal Control.

“Property” means the Real Property and the Personal Property (as defined in
Subsection 22.1 below).

"Qualified Passive Interest Transfer” shall have the meaning set forth in Section
14.4 below.

"Rating Agencies” means one or more credit rating agencies approved by Lender.

"Real Property” means the Land, the Improvements, the Leases and the Rents.

"Recourse Release Conditions” are that (A) the Borrower shall have delivered the
written request to the Lender that the Lender release the Guarantors from liability under
the Guarantee executed by them in connection with the Loan, (B) no Default then exists and
no action or omission has occurred that, with the giving of Notice or the passage of time,
or both, would constitute a Default, (C) for the three consecutive calendar months prior to
the Borrower’s request for such release (i) not less than ninety percent (90%) of the
apartment units on the Land have been occupied by bona fide tenants and (ii) the effective
gross rental income generated by the Real Property from bona fide apartment tenants has
been not less than $122,250 per month, (D) the Borrower has provided the Lender with rent
rolls and operating statements certified by the Borrower and such additional information as
the Lender may have reasonably requested for the purpose of verifying that the conditions
described in items (B) and (C) of this paragraph have been satisfied, and (E) the Borrower
has paid all costs incurred by the Lender in connection with the review of the Borrower’s
release request and related materials as described above in this paragraph.

“Rents” means all rents, income, receipts, issues and profits and other benefits
paid or payable for using, leasing, licensing, possessing, operating from or in, residing
in, selling, mining, extracting minerals from, or otherwise enjoying the Real Property,
whether presently existing or arising in the future, to which the Borrower may now or
hereafter become entitled or may demand or claim from the commencement of the Loan term
through the time of the satisfaction of all of the Obligations, including security
deposits, amounts drawn under letters of credit securing tenant obligations, minimum rents,
additional rents, common area maintenance charges, parking revenues, deficiency rents,
termination payments, space contraction payments, damages following default under a Lease,
premiums payable by tenants upon their exercise of cancellation privileges, proceeds from
lease guarantees, proceeds payable under any policy of insurance covering loss of rents
resulting from untenantability caused by destruction or damage to the Real Property, all
rights and claims of any kind which the Borrower has or may in the future have against the
tenants under the Leases, lease guarantors, or any subtenants or other occupants of the
Real Property, all proceeds of any sale of the Real Property in violation of the Loan
Documents, any future award granted the Borrower in any court proceeding involving any such
tenant in any bankruptcy, insolvency, or reorganization proceedings in any state or federal
court, and any and all payments made by ny such tenant in lieu of rent.

"Restoration” means (A) in the case of a casualty resulting in damage to or the
destruction of the Improvements, the repair or rebuilding of the Improvements to their
original condition, or (B) in the case of the condemnation of a portion of the Real
Property, the completion of such work as may be necessary in order to remedy the effects of
the condemnation so that the value and income-generating characteristics of the Real
Property are restored.

"Securities” means mortgage pass-through certificates or other securities
evidencing a beneficial interest in the Loan, issued in a rated or unrated public offering
or private placement.

	 	 	 
	
 
	 	“Securitization” means the issuance of Securities.
	
 
	 	 
	4

	 	TITLE

The Borrower represents to and covenants with the Lender and with its successors and
assigns that, at the point in time of the grant of the lien created by this Deed of Trust,
the Borrower is well-seized of good and indefeasible title to the Real Property, in fee
simple absolute, subject to no lien or encumbrance except the Permitted Encumbrances. The
Borrower warrants this estate and title to the Trustee and to his successors and assigns
forever, against all lawful claims and demands of all Persons. The Borrower shall maintain
mortgagee title insurance issued by a solvent carrier, covering the Real Property in an
amount at least equal to the amount of the Loan’s original principal balance. This Deed of
Trust is and shall remain a valid and enforceable first lien on the Real Property, and if
the validity or enforceability of this first lien is attacked by appropriate proceedings,
the Borrower shall diligently and continuously defend it through appropriate proceedings.
Should the Borrower fail to do so, the Lender may at the Borrower’s expense take all
necessary action, including the engagement and compensation of legal counsel, the
prosecution or defense of litigation, and the compromise or discharge of claims. The
Borrower shall defend, indemnify and hold the Lender harmless in any suit or proceeding
brought to challenge or attack the validity, enforceability or priority of the lien granted
by this Deed of Trust. If a prior construction, mechanics’ or materialmen’s lien on the
Real Properly arises by operation of statute during any construction or repair of the
Improvements, the Borrower shall either cause the lien to he discharged by paying when due
any amounts owed to such persons, or shall comply with Section 12 of this Deed of Trust.

5. REPRESENTATIONS OF THE GRANTOR

The Borrower represents to the Lender as follows:

5.1 FORMATION, EXISTENCE, GOOD STANDING

The Borrower is a limited partnership duly organized, validly existing and in good
standing under the laws of Ohio and has obtained all licenses and permits and filed
all statements of fictitious name and registrations necessary for the lawful
operation of its business in Ohio.

5.2 QUALIFICATION TO DO BUSINESS

The Borrower is qualified to do business as a foreign limited partnership under the
laws of North Carolina and has obtained all licenses and permits and filed all
statements of fictitious name and registrations necessary for the lawful operation
of its business in North Carolina.

5.3 POWER AND AUTHORITY

The Borrower has full power and authority to carry on its business as presently
conducted, to own the Properly, to execute and deliver the Loan Documents, and to
perform its Obligations.

	 	5.4	 	ANTI-TERRORISM REGULAZONS

Neither the Borrower, any affiliate of the Borrower, nor any person owning an
interest in either of the foregoing is a “Specially Designated National” or a
“Blocked Person” as those terms are defined in the Office of Foreign Asset Control
Regulations (31 CFR Section 500 et seq.).

	 	5.5	 	DUE AUTHORIZATION

The Loan transaction and the performance of all of the Borrower’s Obligations have
been duly authorized by all requisite partnership action, and each individual
executing any Loan Document on behalf of the Borrower has been duly authorized to
do so.

	 	5.6	 	NO DEFAULT OR VIOLATIONS

The execution and performance of the Borrower’s Obligations will not result in any
breach of, or constitute a default under, any contract, agreement, document or
other instrument to which the Borrower is a party or by which the Borrower may be
bound or affected, and do not and will not violate or contravene any law to which
the Borrower is subject; nor do any such other instruments impose or contemplate
any obligations which are or will be inconsistent with the Loan Documents.

5.7 NO FURTER APPROVALS OR ACTIONS REQUIRED

No approval by, authorization of, or filing with any federal, state or municipal or
other governmental commission, board or agency or other governmental authority is
necessary in connection with the authorization, execution and delivery of the Loan
Documents by the Borrower.

5.8 DUE EXECUTION AND DELIVERY

Each of the Loan Documents to which the Borrower is a party has been duly executed
and delivered on behalf of the Borrower.

	 	5.9	 	LEGAL, VALID, BINDING AND ENFORCEABLE

Each of the Loan Documents to which the Borrower is a party constitutes the legal,
valid and binding obligation of the Borrower, enforceable against the Borrower in
accordance with its terms.

5.10 ACCURATE FINANCIAL INFORMATION

All financial information furnished by the Borrower to the Lender in connection
with the application for the Loan is true, correct and complete in all material
respects and does not omit to state any fact or circumstance necessary to make the
statements in them not misleading, and there has been no material adverse change in
the financial condition of the Borrower since the date of such financial
information.

5.11 COMPLIANCE WITH LEGAL REQUIREMENTS

All governmental approvals and licenses required for the conduct of the Borrower’s
business and for the maintenance and operation of the Real Property in compliance
with applicable law are in full force and effect, and the Real Property is
currently being operated in compliance with the Legal Requirements in all material
respects.

5.12 CONTRACTS AND FRANCHISES

All contracts and franchises necessary for the conduct of the Borrower’s business
and for the operation of the Real Property in accordance with good commercial
practice are in force.

5.13 NO CONDEMNATION PROCEEDING

As of the date of this Deed of Trust, the Borrower has no knowledge of any present,
pending or threatened condemnation proceeding or award affecting the Real Properly.

5.14 NO CASUALTY

As of the date of this Deed of Trust, no damage to the Real Property by any fire or
other casualty has occurred, other than damage that has been completely repaired in
accordance with good commercial practice and in compliance with applicable law.

	 	5.15	 	INDEPENDENCE OF THE REAL PROPERTY

The Real Property may be operated independently from other land and improvements
not included within or located on the Land, and it is not necessary to own or
control any property other than the Real Property in order to meet the obligations
of the landlord under any Lease, or in order to comply with the Legal Requirements.

	 	5.16	 	COMPLETE LOTS AND TAX PARCELS

The Land is comprised exclusively of tax parcels that are entirely included within
the Land, and, if the Land is subdivided, of subdivision lots that are entirely
included within the Land.

	 	5.17	 	OWNERSHIP OF FIXTURES

The Borrower owns the Fixtures free of any encumbrances, including purchase money
security interests, rights of lessors, and rights of sellers under conditional
sales contracts or other financing arrangements.

	 	5.18	 	MULTIFAMILY RESIDENTIAL PROPERTY

The Real Property is zoned for multifamily residential use, and the Loan has not
been made for personal, family or household purposes.

	 	5.19	 	PERFORMANCE UNDER DEVELOPMENT AGREEMENTS

A11 of the obligations of the owner of the Real Property due under the Development
Agreements have been fully, timely and completely performed and such performance
has been accepted by the related governmental agency or utility company, and no
Governmental Authority has alleged that any default exists under any of the
Development Agreements.

	 	5.20	 	STATUS OF CERTAIN TITLE MATTERS

Each of the Easements included within the Appurtenances (a) is valid and in full
force and effect and may not be amended or terminated, except for cause, without
the consent of the Borrower, (b) has not been amended or supplemented, (c) requires
no approval of the Improvements that has not been obtained, (d) is free of defaults
or alleged defaults, (e) does not provide for any assessment against the Real
Property that has not been paid in full, and (f) has not been violated by the owner
of the Real Property or, to the best of the Borrower’s knowledge, by any tenant of
the Real Property.

	 	5.2	 	I NO PROHIBITED TRANSACTIONS

The Borrower represents to the Lender that either (a) the Borrower is not an
“employee benefit plan” within the meaning of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”), that is subject to Title I of ERISA, a
“plan” within the meaning of Section 4975 of the Internal Revenue Code of 1986, as
amended (the “Code”), or an entity that is deemed to hold “plan assets” within the
meaning of 29 C.F.R. §2510.3-101 of any such employee benefit plan or (b) the
execution of the Loan Documents, the acceptance of the Loan by the Borrower and the
existence of the Loan will not result in a non-exempt prohibited transaction under
§406 of ERISA or Section 4975 of the Code. The Borrower further warrants and
covenants that the foregoing representation will remain true during the term of the
Loan.

6. COVENANTS

6.1 GOOD STANDING

The Borrower shall remain in good standing as a limited partnership under the laws
of Ohio and shall maintain in force all statements of fictitious name and
registrations necessary for the lawful operation of its business in Ohio during the
term of the Loan.

6.2 QUALIFICATION TO DO BUSINESS

The Borrower shall remain qualified to do business as a foreign limited partnership
under the laws of North Carolina and Michigan and shall maintain in force all
licenses and permits, filings and statements of fictitious name and registrations
necessary for the lawful operation of its business in North Carolina.

6.3 NO DEFAULT OR VIOLATIONS

The Borrower shall not enter into any contract, agreement, document or other
instrument, if the performance of the Borrower’s Obligations would result in any
breach of, or constitute a default under, any such contract, agreement, document or
other instrument, or if the contract, agreement, document or other instrument would
impose or contemplate any obligations the performance of which would result in a
Default under the Loan Documents or would be inconsistent with the performance of
the Borrower’s Obligations.

6.4 PAYMENT AND PERFORMANCE

The Borrower shall pay the Indebtedness and perform all of its other Obligations,
as and when the Loan Documents require such payment and performance.

6.5 SPECIAL PURPOSE ENTITY

The Borrower has not and will not:

	 	(i)	 	engage in any business or activity other than the ownership,
operation and maintenance of the Property, and activities incidental thereto;

	 	(ii)	 	acquire or own any assets other than (A) the Property, and
(B) such incidental Personal Property as may be necessary for the operation of
the Property;

	 	(iii)	 	merge into or consolidate with any Person, or dissolve,
terminate, liquidate in whole or in part, transfer or otherwise dispose of all
or substantially all of its assets or change its legal structure;

	 	(iv)	 	fail to observe all organizational formalities, or fail to
preserve its existence as an entity duly organized, validly existing and in
good standing (if applicable) under the Legal Requirements of the jurisdiction
of its organization or formation, or amend, modify, terminate or fail to
comply with the provisions of its organizational documents;

	 	(v)	 	own any subsidiary, or make any investment in, any Person;

	 	(vi)	 	commingle its assets with the assets of any other Person;

	 	(vii)	 	incur any debt, secured or unsecured, direct or contingent
(including guaranteeing any obligation), other than the Indebtedness,
unsecured trade payables and unsecured equipment leases (both of which must be
incurred in the ordinary course of business relating to the ownership and
operation of the Property,) provided the same (x) do not exceed at any time in
the aggregate a maximum amount of one percent (1%) of the outstanding
principal amount of the Note, and (y) are paid within sixty (60) days after
the date incurred;

	 	(viii)	 	fail to maintain its records, hooks of account, bank accounts, financial
statements, accounting records and other entity documents separate and apart
from those of any other Person;

	 	(ix)	 	enter into any contract or agreement with any general
partner, member, shareholder, principal or affiliate, except upon terms and
conditions that are intrinsically fair and substantially similar to those that
would be available on an arm’s-length basis with unaffiliated third parties;

	 	(x)	 	maintain its assets in such a manner that it will be costly
or difficult to segregate, ascertain or identify its individual assets from
those of any other Person;

	 	(xi)	 	assume or guaranty the debts of any other Person, hold itself
out to be responsible for the debts of any other Person, or otherwise pledge
its assets for the benefit of any other Person or hold out its credit as being
available to satisfy the obligations of any other Person;

	 	(xii)	 	make any loans or advances to any Person (but excluding
partnership distributions);

	 	(xiii)	 	fail to file its own tax returns (unless prohibited by Legal Requirements
from doing so);

	 	(xiv)	 	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 fail to correct any known misunderstanding regarding
its separate identity;

	 	(xv)	 	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 operation;

	 	(xvi)	 	fail to allocate shared expenses (including shared office
space) and to use separate stationery, invoices and checks;

	 	(xvii)	 	fail to pay its own liabilities (including salaries of its own employees)
from its own funds; and

	 	(xviii)	 	acquire obligations or securities of its partners, members, shareholders or
other affiliates, as applicable.

6.6 PAYMENT OF IMPOSITIONS

The Borrower shall pay the Impositions on or before the last day on which they may
be paid without penalty or interest, and shall, within thirty (30) days, furnish
the Lender with a paid receipt or a cancelled check as evidence of payment. If the
Lender does not receive such evidence, the Lender may obtain it directly. If it
does so, the Lender will charge the Borrower an administrative fee of $250 for
securing the evidence of payment. The payment of this fee shall be a demand
obligation of the Borrower. The Borrower may meet the Imposition payment
requirements of this Subsection 6.6 by remitting the Monthly Escrow Payments when
due, by immediately providing Notice to the Lender of any new Imposition or
increased Imposition unknown to the Lender, and by paying to the Lender on demand
any amount required to increase the Escrow Fund to an amount sufficient to permit
the Lender to pay all Impositions from the Escrow Fund on time. If the Borrower
wishes to contest the validity or amount of an Imposition, it may do so by
complying with Section 12. If any new Legal Requirement (other than a general tax
on income or on inlerest payments) taxes the Deed of Trust so that the yield on the
Indebtedness would be reduced, and the Borrower may lawfully pay the tax or
reimburse the Lender for its payment, the Borrower shall do so.

6.7 MAINTENANCE OF THE REAL PROPERTY

The Borrower shall not commit or permit any waste of the Real Property as a
physical or economic asset, and agrees to maintain in good repair the Improvements,
including structures, roofs, mechanical systems, parking lots or garages, and other
components of the Real Property that are necessary or desirable for the use of the
Real Property, or which the Borrower as landlord under any Lease is required to
maintain for the benefit of any tenant. In its

performance of this Obligation, the Borrower shall promptly and in a good and
workmanlike manner repair or restore, as required under Subsection 6.17, any
elements of the Improvements that are damaged or destroyed. The Borrower shall also
replace roofs, parking lots, mechanical systems, and other elements of the
Improvements requiring periodic replacement. The Borrower shall carry out such
replacements no less frequently than would a commercially reasonable owner
intending to maintain the maximum income-generating potential of the Real Property
over its reasonable economic life. The Borrower shall not, without the prior
written consent of the Lender, demolish, reconfigure, or materially alter the
structural elements of the Improvements, unless such an action is the obligation of
the Borrower under a Lease approved by Lender or for which the Lender’s approval is
not required under the Absolute Assignment of Leases and Rents. The Lender agrees
that any request for its consent to such an action shall be deemed given if the
Lender does not respond within fifteen (15) Business Days to any written request
for such a consent, if the request is accompanied by all materials required to
permit the Lender to analyze the proposed action.

6.8 USE OF THE REAL PROPERTY

The Borrower agrees that the Real Property may only be used as a residential
apartment complex and for no other purpose. The Real Property may not he converted
to a cooperative or condominium without Beneficiary’s prior written consent, which
consent may be withheld in Beneficiary’s sole and absolute discretion.

6.9 LEGAL REQUIREMENTS

The Borrower shall maintain in full force and effect all governmental approvals and
licenses required for the conduct of the Borrower’s business and for the
maintenance and operation of the Real Property in compliance with applicable law,
and shall comply with all Legal Requirements relating to the Real Property at all
times.

6.10 CONTRACTS AND FRANCHISES

The Borrower shall maintain in force all contracts and franchises necessary for the
conduct of the Borrower’s business and for the operation of the Real Property in
accordance with good commercial practice.

6.11 COVENANTS REGARDING CERTAIN TITLE WTI’ERS

The Borrower shall promptly pay, perform and observe all of its obligations under
the Easements included within the Appurtenances or under reciprocal easement
agreements, operating agreements, declarations, and restrictive covenants included
in the Permitted Encumbrances, shall not modify or consent to the termination of
any of them without the prior written consent of the Lender, shall promptly furnish
the Lender with copies of all notices of default under them, and shall cause all
covenants and conditions under them and benefiting the Real Property to be fully
performed and observed.

6.12 INDEPENDENCE OF THE REAL PROPERTY

The Borrower shall maintain the independence of the Real Property from other land
and improvements not included within or located on the Land. In fulfilling this
covenant, the Borrower shall neither take any action which would make it necessary
to own or control any property other than the Real Property in order to meet the
obligations of the landlord under any Lease, or in order to comply with the Legal
Requirements, nor take any action which would cause any land or improvements other
than the Land and the Improvements to rely upon the Land or the Improvements for
those purposes.

6.13 COMPLETE LOTS AND TAX PARCELS

The Borrower shall take no action that would result in the inclusion of any portion
of the Land in a tax parcel or subdivision lot that is not entirely included within
the Land.

6.14 APARTMENT PROPERTY

The Real Property shall be used for residential apartments, rather than for
personal, family or household purposes.

6.15 PERFORMANCE UNDER DEVELOPMENT AGREEMENTS

The Borrower shall fully, timely and completely perform all of the obligations of
the owner of the Real Property due under the Development Agreements and shall cause
no default under any of the Development Agreements.

6.16 STATUS OF CERTAIN TITLE MA’ITERS

The Borrower shall not take or fail to take any action with respect to the
Easements included within the Appurtenances or the reciprocal easement agreements,
operating agreements, declarations, and restrictive covenants included in the
Permitted Encumbrances, If as the result of such an action or failure, the subject
Easement or other title matter would (a) be rendered invalid or without force or
effect, (b) be amended or supplemented without the consent of the Lender, (c) be
placed in default or alleged default, (d) result in any lien against the Real
Property, or (e) give rise to any assessment against the Real Property, unless
immediately paid in full.

6.17 RESTORATION WON CASUALTY OR CONDEMNATION

If a casualty or condemnation occurs, the Borrower shall promptly commence the
Restoration of the Real Property, to the extent that the Lender has made Insurance
Proceeds or Condemnation Proceeds available to the Borrower for such Restoration.

6.18 PERFORMANCE OF LANDWRDO BLIGATIONS

The Borrower shall perform its obligations as landlord under the Leases, and shall
neither take any action, nor fail to take any action, if the action or failure
would be inconsistent with the commercially reasonable management of the Real
Property for the purpose of enhancing its long-term performance and value. The
Borrower shall not, without the Lender’s written consent, extend, modify, declare a
default under, terminate, or enter into any Lease of the Real Property.

6.19 FINANCIAL REPORTS AND OPERATING STATEMENTS

(a) Maintenance of Books and Records

During the term of the Loan, the Borrower shall maintain complete and
accurate accounting and operational records, including copies of all
Leases and other material written contracts relating to the Real Property,
copies of all tax statements, and evidence to support the payment of all
material property-related expenses.

(b) Delivery of Financial and Property-Related Information

Within one hundred twenty (120) days after the end of each of its fiscal
years, or, if a Default exists, on demand by the Lender, the Borrower
shall deliver to the Lender (A) copies of the financial statements of the
Borrower and its general partner, including balance sheets and earnings
statements, (B) a complete and accurate operating statement for the Real
Property, and (C) a complete rent roll, all in form satisfactory to the
Lender. The rent roll must be certified by the Borrower to be true and
correct and must include each tenant’s name, premises, type of unit
occupied and leased, rent (including any percentage rent and supporting
sales reports from the related tenants), lease expiration date, renewal
options and related rental rates, delinquencies and vacancies and the
existence of any unsatisfied landlord obligations, e.g., in respect of
free-rent periods, unfinished tenant improvements or other leasing costs.
If the Borrower fails to deliver the items required in this Subsection,
the Lender may engage an accounting firm to prepare the required items.
The Borrower shall cooperate fully with any investigative audit required
to permit the accounting firm to produce these items, and the fees and
expenses incurred in connection with their preparation shall be paid on
demand by the Borrower.

(c) Effect of Failure to Deliver Financial and Property Reports

If no Default exists and the Borrower fails to provide the financial
and property reports required under this Section within one hundred twenty
(120) days of the close of any fiscal year, the Lender will provide a
Notice of this failure and a thirty (30)-day opportunity to cure before a
Default shall exist. All monthly payments of principal and interest under
the Note that become due after this cure period has elapsed but before the
reports are received by the Lender must be accompanied by a fee of,000834
times the principal balance of the Loan at the beginning of the previous
month, regardless of whether the Notice has asserted that the failure
constitutes a Default under this Deed of Trust. This fee is to compensate
the Lender for (A) the increased risk resulting from the Lender’s
inability to monitor and service the Loan using up-to-date information and
(B) the reduced value and liquidity of the Loan as a financial asset.

(dl) Certification of Information

The financial and operating statements provided under this Subsection need
not, as an initial matter, be certified by an independent certified public
accountant as having been prepared in accordance with generally accepted
accounting principles, consistently applied, or, in the case of financial
statements prepared on a cash or income tax basis, or of operating
statements, as not materially misleading based on an audit conducted in
accordance with generally accepted auditing standards. The Borrower shall,
however, certify that such statements are true and correct, and the Lender
expressly reserves the right to require such a certification by an
independent certified public accountant if a Default exists or if the
Lender has reason to believe that any previously provided financial or
operating statement is misleading in any material respect.

6.20 ESTOPPEL STATEMENTS

Upon request by the Lender, the Borrower shall, within ten (10) Business Days of
Notice of the request, furnish to the Lender or to whom it may direct, a written
statement acknowledging the amount of the Indebtedness and disclosing whether any
offsets or defenses exist against the Indebtedness. Thereafter, the Borrower shall
be estopped from asserting any other offsets or defenses alleged to have arisen as
of the date of the statement.

6.21 PROHIBITION ON CERTAIN DISTRIBUTIONS

If Default exists under Subsection 10.1 or under any of Subparagraphs (b), (c),
(d), (e) or (f) of Subsection 10.2, the Borrower shall not pay any dividend or make
any partnership, trust or other distribution, and shall not make any payment or
transfer any property in order to purchase, redeem or retire any interest in its
beneficial interests or ownership.

	 	 	 
	6.22

	 	USE OF LOAN PROCEEDS

The Loan proceeds shall be used solely for commercial purposes.
	6.23

	 	PROHIBITION ON CUTOFF NOTICES

The Borrower shall not issue any Notice to the Lender to the effect that liens on
the Real Property after the date of the Notice will enjoy priority over the lien of
this Deed of Trust.

6.24 PROHIBITED PERSON COMPLIANCE

The Borrower warrants, represents and covenants that neither the Borrower nor any
Obligor nor any of their respective affiliated entities is or will be an entity or
person (i) that is listed in the Annex to, or is otherwise subject to the
provisions of Executive Order 13224 issued on September 24, 2001 (“E013224”), (ii)
whose name appears on the United States Treasury Department’s Office of Foreign
Assets Control (“OFAC”) most current list of “Specifically Designated Nationals and
Blocked Persons” (which list may be published from time to time in various mediums
including, but not limited to, the OFAC website,
http:www.treas.gov/ofac/tl1sdn.pdf), (iii) who commits, threatens to commit or
supports “terrorism”, as that term is defined in EO 13224, or (iv) who is otherwise
affiliated with any entity or person listed above (any and all parties or persons
described in subparts [i] — [iv] above are herein referred to as a “Prohibited
Person”). The Borrower covenants and agrees that neither the Borrower, nor any
Obligor nor any of their respective affiliated entities will (i) conduct any
business, nor engage in any transaction or dealing, with any Prohibited Person,
including, but not limited to the making or receiving of any contribution of funds,
goods, or services, to or for the benefit of a Prohibited Person, or (ii) engage in
or conspire to engage in any transaction that evades or avoids, or has the purpose
of evading or avoiding, or attempts to violate, any of the prohibitions set forth
in E013224. The Borrower further covenants and agrees to deliver (from time to
time) to the Lender any such certification or other evidence as may be requested by
the Lender in its sole and absolute discretion, confirming that (i) neither the
Borrower nor any Obligor is a Prohibited Person and (ii) neither the Borrower nor
any Obligor has engaged in any business, transaction or dealings with a Prohibited
Person, including, but not limited to, the making or receiving of any contribution
of funds, goods, or services, to or for the benefit of a Prohibited Person.

6.25 EXERCISE OF LEGAL CONTROL

One or more of Phillip I. Levin, Joseph J. Recchie, Bradley J. Schram and Norman A.
Pappas (together with any Person who assumes liability for Carveout Obligations in
the future) shall at all times exercise Legal Contml of the Borrower, provided that
Joseph J. Recchie shall not solely exercise such Legal Control.

7. INSURANCE REQUIREMENTS

At all times until the Indebtedness is paid in full, the Borrower shall maintain insurance
coverage and administer insurance claims in compliance with this Section.

7.1 REQUIRED COVERAGES

(a) Open Perils/Special Form/Special Perils Property

The Borrower shall maintain “Open Perils,” “Special Form,” or “Special
Perils” property insurance coverage in an amount not less than one hundred
percent (100%) of the replacement cost of all insurable elements of the
Real Property and of all tangible Personal Property, with coinsurance
waived, or if a coinsurance clause is in effect, with an agreed amount
endorsement acceptable to the Lender. Coverage shall extend to the Real
Property and to all tangible Personal Property.

(b) Broad Form Boiler and Machinery

If any boiler or other machinery is located on or about the Real Property,
the Borrower shall maintain broad form boiler and machinery coverage,
including a form of business income coverage.

(c) Flood

If the Real Property is located in a special flood hazard area (that is,
an area within the 100-year floodplain) according to the most current
flood insurance rate map issued by the Federal Emergency Management Agency
and if flood insurance is available, the Borrower shall maintain flood
insurance coverage on all insurable elements of Real Property and of all
tangible Personal Property.

(d) Business Interruption

The Borrower shall maintain a form of business income coverage in the
amount of eighty percent (80%) of one year’s business income from the
Property.

(e) Comprehensive/General Liability

The Borrower shall maintain commercial general liability coverage (which
may be in the form of umbrella/excess liability insurance) with a
$1,000,000 combined single limit per occurrence and a minimum aggregate
limit of $2,000,000.

Liquor Liability

The Borrower shall maintain liquor liability coverage, if applicable law
may impose liability on those selling, serving, or giving alcoholic
beverages to others and if such beverages will be sold, served or given on
the Real Property by the Borrower.

(g) Elective Coverages

The Lender may require additional coverages appropriate to the property
type and site location. Additional coverages may include earthquake,
windstorm, mine subsidence, sinkhole, personal property, supplemental
liability, or coverages of other property-specific risks.

7.2 PRIMARY COVERAGE

Each coverage required under this Section shall be primary rather than contributing
or secondary to the coverage the Borrower may carry for other properties or risks;
provided, however, that blanket coverage which otherwise complies with the
terms of this Section shall be acceptable if (a) the policy includes limits by
property location and (b) the Lender determines, in the exercise of its sole and
absolute discretion, that the amount of such coverage is sufficient in light of the
other risks and properties insured under the blanket policy.

7.3 HOW THE LENDER SHALL BE NAMED

On all property insurance policies and coverages required under this Section
(including coverage against loss of business income), the Lender must be named as
“first mortgagee” under a standard mortgage clause. On all liability policies and
coverages, the Lender must be named as an “additional insured.” The Lender shall he
referred to verbatim as follows: “Transamerica Occidental Life Insurance Company
and its successors, assigns, and affiliates; as their interest may appear; c/o
AEGON USA Realty Advisors, Inc.; Mortgage Loan Dept.; 4333 Edgewood, Rd., NE, Cedar
Rapids, Iowa 52499-5443.”

7.4 RACING

Each insurance carrier providing insurance required under this Section must have,
independently of its parent’s or any reinsurer’s rating, a General Policyholder
Rating of A, and a Financial Rating of IX or better, as reported in the most
current issue of Best’s Insurance Guide, or as reported by Best on its internet web
site.

	 	 	 
	7.5

	 	DEDUCTIBLE

The maximum deductible on each required coverage or policy is $100,000.
	7.6

	 	NOTICES, CHANGES AND RENEWALS

All policies must require the insurance carrier to give the Lender a minimum of
thirty (30) days’ notice in the event of modification, cancellation or termination
for non payment of premium and a minimum of thirty (30) days’ notice of nonrenewal.
The Borrower shall report to the Lender immediately any facts known to the Borrower
that may adversely affect the appropriateness or enforceability of any insurance
contract, including, without limitation, changes in the ownership or occupancy of
the Real Property, any hazard to the Real Property and any matters that may give
rise to any claim. Prior to expiration of any policy required under this Section,
the Borrower shall provide either (a) an original or certified copy of the renewed
policy, or (b) a “binder,” an Acord 28 (real property), Acord 27 (personal
property) or Acord 25 (liability) certificate, or another document satisfactory to
the Lender conferring on the Lender the rights and privileges of mortgagee. If the
Borrower meets the foregoing requirement under clause (h), the Borrower shall
supply an original or certified copy of the original policy within ninety (90)
days. All binders, certificates, documents, and original or certified copies of
policies must name the Borrower as a named insured or as an additional insured,
must include the complete and accurate property address and must hear the original
signature of the issuing insurance agent.

7.7 UNEARNED PREMIUMS

If this Deed of Trust is foreclosed, the Lender may at its discretion cancel any of
the insurance policies required under this Section and apply any unearned premiums
to the Indebtedness.

7.8 FORCED PLACEMENT OF INSURANCE

If the Borrower fails to comply with the requirements of this Section, the
Lender may, at its discretion, procure any required insurance. Any premiums paid
for such insurance, or the allocable portion of any premium paid by the Lender
under a blanket policy for such insurance, shall be a demand obligation under this
Deed of Trust, and any unearned premiums under such insurance shall comprise
Insurance Proceeds and therefore a portion of the Property.

8. INSURANCE AND CONDEMNATION PROCEEDS

8.1 ADJUSTMENT AND COMPROMISE OF CLAIMS AND AWARDS

The Borrower may settle any insurance claim or condemnation proceeding if the
effect of the casualty or the condemnation may be remedied for $100,000 or less,
and if the Borrower promptly notifies the Lender of the existence of such insurance
claim or condemnation and provides the Lender copies of all correspondence and
other documentation involved in the settling of the claim or condemnation, with
such copies to be furnished as the correspondence or other documentation is sent or
received by the Borrower. If a greater sum is required, the Borrower may not settle
any such claim or proceeding without the advance written consent of the Lender. If
a Default exists, the Borrower may not settle any insurance claim or condemnation
proceeding without the advance written consent of the Lender.

8.2 DIRECT PAYMENT TO THE LENDER OF PROCEEDS

If the Insurance Proceeds received in connection with a casualty or the
Condemnation Proceeds received in respect of a condemnation exceed $1 00,000, or if
there is a Default, then such proceeds shall be paid directly to the Lender.

The Lender shall have the right to endorse instruments which evidence proceeds that
it is entitled to receive directly.

8.3 AVAILABILl7Y TO THE BORROWER OF PROCEEDS

The Borrower shall have the right to use the Insurance Proceeds or the Condemnation
Proceeds to carry out the Restoration of the Real Property, if the amount received
is less than $290,000, subject to the conditions set forth in Subsections 8.4, 8.5,
and 8.6 of this Section. If the amount received in respect of a casualty or
condemnation equals or exceeds $290,000, and if the Loan-to-Value ratio of the
Property on completion will be eighty percent (80%) or less, as determined by the
Lender in its discretion based on its estimate of the market value of the Real
Property, the Lender shall receive such Insurance Proceeds or Condemnation Proceeds
directly and hold them in a fund for Restoration subject to the conditions set
forth in Subsections 8.4, 8.5, and 8.6 of this Section. If the Lender’s estimate of
the market value of the Real Property implies a Loan-to-value ratio of over SO%,
and the Borrower disagrees with the Lender’s estimate, the Borrower may require
that the Lender engage an independent appraiser (the “Fee Appraiser”) to prepare
and submit to AEGON a full narrative appraisal report estimating the market value
of the Real Property. The Fee Appraiser shall be certified in North Carolina and
shall be a member of a national appraisal organization that has adopted the Uniform
Standards of Professional Appraisal Practice (USPAP) established by the Appraisal
Standards Board of the Appraisal Foundation. The Fee Appraiser will be required to
use assumptions and limiting conditions established by the Lender prior to the
funding of the Loan and to prepare the appraisal in conformity with the Lender’s
Appraisal Guidelines. For purposes of this Section, the independent appraiser’s
value conclusion shall he binding on both the Lender and the Borrower. The Borrower
shall have the right to make a prepayment of the Loan, without premium, sufficient
to achieve this Loan-to-value ratio. The independent fee appraisal shall be at the
Borrower’s expense, and the Borrower shall pay to the Lender an administrative fee
of $2,500 in connection with its review. The Lender may require that the Borrower
deposit $10,000 with the Lender as security for these expenses or may pay the fee
appraiser’s and administrative fees from the proceeds at its sole discretion.

Unless the Borrower has the right to use the Insurance Proceeds or the Condemnation
Proceeds under the foregoing paragraphs, the Lender may, in its sole and absolute
discretion, either apply them to the Loan balance or disburse them for the purposes
of repair and reconstruction, or to remedy the effects of the condemnation. No
prepayment premium will be charged on amounts applied to reduce the principal
balance of the Loan.

8.4 CONDITIONS TO AVAILABILITY OF PROCEEDS

The Lender shall have no obligation to release Insurance Proceeds or Condemnation
Proceeds to the Borrower, and may hold such amounts as additional security for the
Loan, if (a) a Default exists, (b) a payment Default has occurred during the
preceding twelve (12) months, (c) the Lender has delivered to the Borrower Notice
of any act, omission or circumstance that will, if uncured, become a Default, and
the required cure has not been effected or (d) if the Insurance Proceeds or
Condemnation Proceeds received by the Lender and any other funds deposited by the
Borrower with the Lender are insufficient, as determined by the Lender in its
reasonable discretion, to complete the

Restoration. If a Default exists, the Lender may at its sole and absolute
discretion apply such Insurance Proceeds and Condemnation Proceeds to the full or
partial cure of the Default.

	 	8.5	 	PERMITTED MEZZANINE FINANCING FOR REBUIZDINOGR REMEDIATION OF THE EFFECT OF
TAKING BY EMINENT DOMAIN

If the Lender reasonably determines that the Insurance Proceeds or Condemnation
Proceeds received in respect of a casualty or condemnation, as the case may be,
would be insufficient to permit the Borrower to restore the Improvements to their
condition before the casualty, or to remedy the effect on the Real Property of the
condemnation, then the Borrower shall use its best efforts to secure such
additional funds as are necessary to effect the Restoration. The Borrower’s
obligation to use its best efforts shall be limited to securing such funds on a
non-recourse basis. Interests in the Borrower may be pledged as security to the
extent necessary in connection with any such financing.

8.6 DRAW REQUIREMENTS

The Borrower’s right to receive Insurance Proceeds and Condemnation Proceeds held
by the Lender under this Section shall be conditioned on the Lender’s approval of
plans and specifications for the Restoration. Each draw except the last shall be in
the minimum amount of $50,000. Draw requests shall be accompanied by customary
evidence of construction completion, and by endorsements to the Lender’s mortgagee
title insurance coverage insuring the absence of construction, mechanics’ or
materialmen’s liens. Draws based on partial completion of the Restoration shall be
subject to a ten percent (10%) holdback. All transactional expenses shalt be paid
by the Borrower.

9. ESCROW FUND

The Borrower shall pay the Monthly Escrow Payment on the first (1st) day of every month,
commencing with the month in which the first regular payment of principal and interest is
due. The Lender shall hold Monthly Escrow Payments in an interest-bearing fund from which
the Lender will pay on a timely basis those Escrow Expenses that the Lender has anticipated
will become payable on a regular basis during the Loan’s term, and on which the Lender has
based its determination of the Monthly Imposition Requirement, the Monthly Insurance
Premium Requirement and the Monthly Reserve Requirement. The Escrow Fund will he maintained
as an accounting entry in the Lender’s general account, where it may be commingled with the
Lender’s other funds. The Escrow Fund shall bear interest, which shall become part of the
Escrow Fund. The interest rate will he the passbook rate of interest at a bank in Cedar
Rapids, Iowa, at the end of the interest accrual period. Interest will be compounded
annually based on the average monthly balance. The Lender may reanalyze the projected
Escrow Expenses from time to time and shall advise the Borrower of any change in the amount
of the Monthly Escrow Payment. Upon the foreclosure of this Deed of Trust, the delivery of
a deed in lieu of foreclosure, or the payoff of the Loan, the Lender sball apply amounts in
the Escrow Fund, net of accrued Escrow Expenses, to the Indebtedness. The Lender shall
remit any amounts in excess of the lndebtedness to the Borrower.

10. DEFAULT

10.1 PAYMENT DEFAULTS

A “Default” shall exist without Notice upon the occurrence of any of the following
events:

(a) Scheduled Payments

The Borrower’s failure to pay, or to cause to be paid, (i) any regular
monthly payment of principal and interest under the Note, together with
any required Monthly Escrow Payment, on or before the seventeenth (17”)
day of the month in which it is due and (ii) any other scheduled payment
under the Note, this Deed of Trust or any other Loan Document.

(b) Payment at Maturity

The Borrower’s failure to pay, or to cause to be paid, the Indebtedness
when the Loan matures by acceleration under Section 16, because of a
transfer or encumbrance under Section 13, or by lapse of time.

(c) Demand Obligations

The Borrower’s failure to pay, or to cause to be paid, within five (5) Business
Days of the Lender’s demand, any other amount required under the Note, this Deed of
Trust or any of the other Loan Documents.

10.2 INCURABLE NONMONETARY DEFAULT

A Default shall exist upon any of the following:

(a) Material Untruth or Misrepresentation

The Lender’s discovery that any representation made by the Borrower in any
Loan Document was materially untrue or misleading when made, if the
misrepresentation either was intentional or is not capable of being cured
as described in paragraph 10.3(a) below.

(b) Due on Sale or Encumbrance

The occurrence of any sale, conveyance, transfer or vesting that would
result in the Loan becoming immediately due and payable at the Lender’s
option under Section 13.

(c) Voluntary Bankruptcy Filing

The filing by the Borrower or any Guarantor of a petition in bankruptcy or
for relief &om creditors under any present or hture law that affords
general protection from creditors.

(d) Insolvency

The failure of the Borrower generally to pay its debts as they become due,
its admission in writing to an inability so to pay its debts, the making
by the Borrower of a general assignment for the benefit of creditors, or a
judicial determination that the Borrower is insolvent.

(e) Receivership

The appointment of a receiver or trustee to take possession of any of the
assets of the Borrower.

(f) Levy or Attachment

The taking or seizure of any material portion of the Property under levy
of execution or attachment.

(g) Lien

The filing against the Real Property of any lien or claim of lien for the
performance of work or the supply of materials, or the filing of any
federal, state or local tax lien against the Borrower, or against the Real
Property, unless the Borrower promptly complies with Section 12 of this
Deed of Trust.

(h) Defaults under other Loan Documents

The existence of any default under any other Loan Document, provided any
required Notice of such default has been given and any applicable cure
period has expired.

(i) Dissolution or Liquidation

The Borrower shall initiate or suffer the commencement of a proceeding for
its dissolution or liquidation, and such proceeding shall not be dismissed
within thirty (30) days, or the Borrower shall cease to exist as a legal
entity (unless resulting in a Permitted Transfer).

10.3 CURABLE NON-MONETARY DEFAULT

A Default shall exist, following the cure periods specified below, under the
following circumstances:

(a) Unintentional Misrepresentations that are Capable of Being Cure

A “Default” shall exist if the Lender discovers that the Borrower has
unintentionally made any material misrepresentation that is capable of
being cured, unless following Notice thereof by the Lender to the
Borrower, the Borrower promptly commences and diligently pursues a cure of
the misrepresentation approved by the Lender, and completes the cure
within thirty (30) days following such Notice. Any such cure shall place
the Lender in the risk position that would have existed had the false
representation been true when made.

(b) Involuntary Bankruptcy or Similar Filing

The Borrower or any Guarantor becomes the subject of any petition or
action seeking to adjudicate it bankrupt or insolvent, or 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, or that
may result in a composition of its debts, provide for the marshaling of
the Borrower’s or any Guarantor’s assets for the satisfaction of its
debts, or result in the judicially ordered sale of the Borrower’s or any
Guarantor’s assets for the purpose of satisfying its obligations to
creditors, unless a motion for the dismissal of the petition or other
action is filed within ten (10) days and results in its dismissal within
sixty (60) days of the filing of the petition or other action.

(c) Entry of a Material Judgment

Any judgment is entered against the Borrower or any other Obligor, and the
judgment may materially and adversely affect the value, use or operation
of the Real Property, unless either (i) a timely appeal of such judgment
is filed, within ten (10) Business Days following the entering of such
judgment, the enforcement of such judgment is stayed by a bond or other
means, and such stay remains in force until the judgment is overturned on
appeal or satisfied, or (ii) the judgment is satisfied within ten (10)
Business Days.

(d) Other Defaults

The Borrower fails to observe any promise or covenant made in this Deed of
Trust, unless the failure results in a Default described elsewhere in this
Section 10, provided the Lender delivers written Notice to the Borrower of
the existence of such an act, omission or circumstance, and that such an
act, omission or circumstance shall constitute a Default under the Loan
Documents unless the Borrower promptly initiates an effort to cure the
potential Default, pursues the cure diligently and continuously, and
succeeds in effecting the cure within one hundred twenty (120) days of its
receipt of Notice. The Lender shall afford the Borrower an additional
period of one hundred twenty (120) days in cases where construction or
repair is needed to cure the potential Default, and the cure cannot be
completed within the first one hundred twenty (120) day cure period.
During the cure period, the Borrower has the obligation to provide on
demand satisfactory documentation of its effort to cure, and, upon
completion, evidence that the cure has been achieved. All notice and cure
periods provided in this Deed of Trust shall run concurrently with any
notice or cure periods provided by law.

11. RIGHT TO CURE

The Lender shall have the right to cure any Default. The expenses of doing so shall
be part of the Indebtedness, and the Borrower shall pay them to the Lender on
demand.

12. CONTEST RIGHTS

The Borrower may secure the right to contest Impositions and construction,
mechanics’ or materialmen’s liens, through appropriate proceedings conducted in
good faith, by either (A) depositing with the Lender an amount equal to one hundred
twenty five percent (125%) of the amount of the Imposition or the lien, or (B)
obtaining and maintaining in effect a bond issued by a surety acceptable to the
Lender, in an amount equal to the greater of (i) the amount of a required deposit
under clause (A) above and (ii) the amount required by the surety or by the court
in order to obtain a court order staying the foreclosure of the lien pending
resolution of the dispute, and releasing the lien of record. The proceeds of such
a bond must be payable directly to the Lender. The surety issuing such a bond must
be acceptable to the Lender in its sole discretion. After such a deposit is made or
bond issued, the Borrower shall promptly commence the contest of the lien and
continuously pursue that contest in good faith and with reasonable diligence. If
the contest of the related Imposition or lien is unsuccessful, any deposits or bond
proceeds shall he used to pay the Imposition or to satisfy the obligation from
which the lien has arisen. Any surplus shall be refunded to the Borrower.

13. DUE ON TRANSFER OR ENCUMBRANCE

Upon the sale or transfer of any portion of the Real Property or any other
conveyance, transfer or vesting of any direct or indirect interest in the Borrower
or the Property, including (i) the direct or indirect transfer of, or the granting
of a security interest in, the ownership of the Borrower, (ii) any encumbrance
(other than a Permitted Encumbrance) of the Real Property (unless the Borrower
contests the encumbrance in compliance with Section 12) and (iii) the lease,
license or granting of any security interest in the Personal Property, the
Indebtedness shall, at the Lender’s option, become immediately due and payable upon
Notice to the Borrower, unless the sale, conveyance, transfer or vesting is a
Permitted Transfer.

14. DUE ON SALE EXCEPTIONS

14.1 TRANSFER TO AN APPROVED PURCHASER

The Borrower shall have the right, on one occasion during the term of the
Loan, to sell or transfer the Property in a transaction approved by the
Lender. The Lender agrees to approve a transfer if the following
conditions are satisfied:

(a) No Default

No Default shall exist, and no act, omission or circumstance shall
exist which, if uncured following Notice and the passage of time,
would become a Default.

(b) Request and Supporting Materials

The Lender shall receive a written request for its approval at
least ninety (90) days before the proposed transfer. The request
shall specify the identity of the proposed transferee and the
purchase price and other terms of the transaction, shall include a
copy of the proposed contract of sale, and shall be accompanied by
the financial statements, tax returns, and organizational
documents of the proposed transferee and its principals.

(c) Criteria to be Considered

The ownership structure, financial strength, credit history and
demonstrated property management expertise of the proposed
transferee and its principals shall be satisfactory to the Lender
in its sole discretion. The Lender expressly reserves the right to
withhold its approval of the proposed transfer if the proposed
transferee or any of its principals is or has been the subject of
any bankruptcy, insolvency, or similar proceeding.

(d) Assumption Agreement

Under the terms of the proposed transfer, the proposed transferee
shall assume the Loan, without modification, under the tenns of an
assumption agreement and additional documentation satisfactory to
the Lender in form and substance. Under the assumption agreement,
the transferee shall provide a representation as to tbe purchase
price paid for the Real Property.

(e) Retention of Caweout Obligations

Under the terms of the assumption agreement and additional
documentation, liability for Carveout Obligations arising after
the date of the transfer and assumption shall be assumed by the
principals of the proposed transferee, and liability for Carveout
Obligations arising before or in connection with the transfer
shall be retained by those liable for them before the transfer.

(f) Title Insurance Endorsement

The Borrower shall agree to provide an endorsement to the Lender’s
mortgagee title insurance policy, insuring the continued validity
and priority of this Deed of Trust following the assumption.

(g) Assumption Fee

The Lender shall receive an assumption fee of one percent (1%) of
the outstanding balance of the Loan, and the Borrower shall agree
to reimburse the Lender’s out-of-pocket expenses incurred in
connection with the proposed transfer, including title updates and
endorsement charges, recording fees, any applicable taxes and
attorneys’ fees, regardless of whether the transfer is
consummated.

14.2 LIMITED PARTNERSHIP TRANSFERS

Transfers between limited partners of the Borrower of their limited
partnership interests and the Borrower’s admission of new limited partners
shall constitute Permitted Transfers for purposes of Section 13.

	 	14.3	 	PERMITTED MEZZANINE FINANCING IN CONNECTION WITH CASUALTY OR
CONDEMNATION

Any pledge of interests in the Borrower in connection with a financing
described in Subsection 8.5 shall constitute a Permitted Transfer for
purposes of Section 13.

14.4 P ERMITTED TRANSFERS OF CERTAIN PASSIVE INTERESTS

The Lender agrees that it shall not unreasonably withhold its consent to
certain transfers of direct or indirect interests in the Borrower (each a
“Qualified Passive Interest Transfer”). A “Qualified Passive Interest
Transfer” is any transfer of a direct or indirect interest in the
Borrower, if, following the transfer (i) the Real Property remains under
the individual or collective Legal Control of one or more Permitted
Control Group Members, (ii) the transfer does not result in a Prohibited
Structural Change and (iii) the transfer either (A) does not result in a
change in assets that would be at risk with respect to any recourse
obligations, or (B) is a transfer of direct interests in the Borrower to
the devisees of the estate of a deceased Carveout Obligor, and the Net
Worth Requirement with respect to the remaining or new Carveout Obligors
shall have been met by the Borrower.

14.5 TRANSACTION COSTS

The Borrower shall pay all out-of-pocket expenses incurred by the Lender
in the review and processing of any proposed Permitted Transfer,
regardless of whether the Permitted Transfer is carried out.

15. NOTICE OF ABSOLUTE ASSIGNMENT OF LEASES AND RENTS

Under the Absolute Assignment of Leases and Rents, the Borrower has assigned to the
Lender, and to its successors and assigns, all of the Borrower’s right and title
to, and interest in, the Leases, including all rights under the Leases and all
benefits to be derived from them. The rights assigned include all authority of the
Borrower to modifL or terminate Leases, or to exercise any remedies, and the
benefits assigned include all Rents. This assignment is present and absolute, hut
under the terms of the Absolute Assignment of Leases and Rents, the Lender has
granted the Borrower a conditional license to collect and use the Rents, and to
exercise the rights assigned, in a manner consistent with the Obligations, all as
more particularly set forth in the Absolute Assignment of Leases and Rents. The
Lender may, however, terminate the license by written Notice to the Borrower only
on certain conditions set forth in the Absolute Assignment of Leases and Rents.

16. ACCELERATION

If a Default exists, the Lender may, at its option, declare the unpaid principal
balance of the Note to be immediately due and payable, together with all accrued
interest on the indebtedness, all wsts of collection (including reasonable
attorneys’ fees and expenses) and all other charges due and payable by the Borrower
under the Note or any other Loan Document. Nevertheless, if the subject Default has
arisen from a failure by the Borrower to make a regular monthly payment of
principal and interest, the Lender shall not accelerate the indebtedness unless the
Lender shall have given the Borrower a cure period of least three (3) Business Days
following Notice of its intent to do so. If the subject Default is curable and
nonmooetary in nature, the Lender shall exercise its option to accelerate only by
delivering notice of acceleration to the Borrower. The Lender shall not deliver any
such notice of acceleration until (a) the Borrower has received any required notice
of the prospective Default and (b) any applicable cure period has expired. Except
as expressly described in this Section, no notice of acceleration shall be required
in order for the Lender to exercise its option to accelerate the indebtedness in
the event of Default.

17. RIGHTS OF ENTRY AND TO OPERATE

1 7.1 ENTRY ON REAL PROPERTY

If a Default exists, the Lender may, to the extent permitted by law, enter
upon the Real Property and take exclusive possession of the Real Property
and of all books, records and accounts, all without Notice and without
being guilty of trespass, but subject to the rights of tenants in
possession under the Leases. If the Borrower remains in possession of all
or any part of the Property after Default and without the Lender’s prior
written consent, the Lender may, without Notice to the Borrower, invoke
any and all legal remedies to dispossess the Borrower. Following Default,
the Lender may hold, lease, manage, operate or otherwise use or permit the
use of the Real Property, either itself or by other persons, firms or
entities, in such manner, for such time and upon such other terms as the
Lender may deem to be prudent under the circumstances (making such
repairs, alterations, additions and improvements thereto and taking any
and all other action with reference thereto, from time to time, as the
Lender deems prudent), and apply all Rents and other amounts collected by
the Lender in accordance with the provisions of the Absolute Assignment of
Leases and Rents.

18. RECEIVERSHIP

Following Default, the Lender may apply to a court of competent jurisdiction for
the appointment of a receiver of the Property, ex parte without Notice to the
Borrower, whether or not the value of the Property exceeds the Indebtedness,
whether or not waste or deterioration of the Real Property has occurred, and
whether or not other arguments based on equity would justify the appointment. To
the extent permitted by law, the Borrower irrevocably, with knowledge and for
valuable consideration, consents to such an appointment. Any such receiver shall
have all the rights and powers customarily given to receivers in North Carolma,
including the rights and powers granted to the Lender by this Deed of Trust, the
power to maintain, lease and operate the Real Property on terms approved by the
court, and the power to collect the Rents and apply them to the Indebtedness or
otherwise as the court may direct. Once appointed, a receiver may at the Lender’s
option remain in place until the Indebtedness has been paid in full.

19. FORECLOSURE; POWER OF SALE

Upon Default, the Lender may elect immediately to proceed with the foreclosure of
the lien of this Deed of Trust, against all or part of the Property, and at the
option of the Lender, the Trustee may foreclose this Deed of Trust by judicial
proceedings in accordance with the laws of North Carolina, or the Lender may
without further notice direct Trustee, and Trustee is authorized and empowered, in
accordance with applicable law relating to nonjudicial foreclosure sales under
power of sale then in effect, to foreclose the lien of this Deed of Trust, after
having first given such notice of hearing as to commencement of foreclosure
proceedings and obtained such findings of leave of court as may then be required by
law, and after having given such notice and advertising the time and place of sale
in such manner as may then be required by law, and to sell and dispose of all or
any part of the Property at public auction for cash, in any sequence or order as
the Lender may elect, and all the right, title, and interest of the Borrower
therein, by sale at any place then authorized by law as may be specified in the
notice of such sale, to the highest bidder. Upon final completion of such sale and
any resales as made pursuant to law, Trustee shall execute a conveyance of the
Property, or applicable portion thereof, to the purchaser. After retaining a
reasonable fee, not to exceed five percent (5%) of the gross proceeds of sale, as
compensation to Trustee, Trustee shall apply the proceeds of the sale as follows:
first, to pay all reasonable fees, charges and costs of conducting the sale and
advertising the Property, and to pay any prior liens or encumbrances unless such
sale is made subject thereto, and to pay necessary costs, as well as to reimburse
the Lender for its advances, to protect and maintain the Property, and to pay
Impositions, in accordance herewith; second, to pay the Lender all accrued and
unpaid interest under the Note, then the unpaid principal balance of the Note, and
then all of the other Indebtedness; and third, the remainder of the proceeds, if
any, to Grantor. The purchaser at the sale shall not be responsible for the
application of the proceeds. No provision in this Deed of Trust concerning
foreclosure procedures which specifies any particular actions to be taken by
Trustee or the Lender shall he deemed to contradict the requirements and procedures
(now or hereafter existing) of North Carolina law, and any such contradiction shall
he resolved in favor of North Carolina law applicable at the time of foreclosure.
The Lender may sell the Personal Property hereunder in whole or part and in any
order, together with the remaining Property or separately. The Lender may hid and
become the purchaser at any sale under this Deed of Trust and may apply against the
purchase price all or any portion of the balance of the Indebtedness.

20. WAIVERS

To the maximum extent permitted by law, the Borrower irrevocably and
unconditionally WAIVES and RELEASES any present or future rights (a) of
reinstatement or redemption (b) that may exempt the Property from any civil
process, (c) to appraisal or valuation of the Property, (d) to extension of time
for payment, (e) that may subject the Lender’s exercise of its remedies to the
administration of any decedent’s estate or to any partition or liquidation action,
(0 to any homestead and exemption rights provided by the Constitution and laws of
the United States and of Nortb Carolina, (g) to notice of acceleration or notice of
intent to accelerate (other than as expressly stated herein), and (h) that in any
way would delay or defeat the right of the Lender to cause the sale of the Real
Property for the purpose of satisfying the Indebtedness. To the fullest extent
permitted by law, the Borrower agrees that the price paid at a lawful foreclosure
sale, whether by the Lender or by a third party, and whether paid through
cancellation of all or a portion of the Indebtedness or in cash, shall conclusively
establish the value of the Real Property. The foregoing waivers shall apply to and
bind any party assuming the Obligations of the Borrower under this Deed of Trust.

21. EXCULPATION CLAUSE AND CARVEOUT OBLIGATIONS

The Lender agrees that it shall not seek to enforce any monetary judgment with
respect to the Indebtedness evidenced by the Note against the Borrower (a) except
through recourse to the Property, unless the Obligation from which the judgment
arises is a Carveout Obligation, and (b) except to the extent of an aggregate of
Four Million Dollars and No Cents ($4,000,000.00), unless and until the Recourse
Release Conditions have been satisfied. The Carveout Obligations include (a) the
obligation to repay any portion of the Indebtedness that arises because the Lender
has advanced funds or incurred expenses as a result of any of the “Carveouts” (as
defined below), (b) the obligation to repay the entire Indebtedness, if the
Lender’s exculpation of the Borrower from personal liability under

this Section has become void as set forth below, (c) the obligation to indemnify
the Lender in respect of its actual damages suffered in connection with a Carveout,
and (d) the obligation to defend and hold the Lender harmless from and against any
claims, judgments, causes of action or proceedings arising from a Carveout. The
Carveouts are:

(i) fraud or material written misrepresentation;

	 	(ii)	 	waste of the Property (which shall include
damage, destruction or disrepair of the Real Property caused by a
willful act or grossly negligent omission. of the Borrower, but shall
exclude ordinary wear and tear in the absence of gross negligence);

	 	(iii)	 	misappropriation of tenant security
deposits (including proceeds of tenant letters of credit), Insurance
Proceeds or Condemnation Proceeds;

(iv) failure to pay property taxes, assessments or other lienable
Impositions;

	 	(v)	 	failure to pay to the Lender all Rents,
income and profits (including any rent collected more than one month
in advance, or any rent for the last month of the lease term, under
any Lease in force at the time of Default), net of reasonable and
customary operating expenses, received in respect of a period when
the Loan is in Default;

	 	(vi)	 	removal from the Real Property of fixtures
or Personal Property, unless replaced in a commercially reasonable
manner;

	 	(vii)	 	the out-of-pocket expenses of enforcing
the Loan Documents following Default, not including expenses incurred
after the Borrower has agreed in writing to transfer the Real
Property to the Lender by the Lender’s choice of either an
uncontested foreclosure or delivery of a deed in lieu of foreclosure;

	 	(viii)	 	terminating or amending a Lease other than in the ordinary course
of business; and

	 	(ix)	 	any liability of the Borrower under the
Environmental Indemnity Agreement. The Lender’s exculpation of the
Borrower from personal liability for the repayment of the
Indebtedness evidenced by this Note shall be void without Notice if
the Borrower (A) voluntarily transfers or creates any voluntary lien
on the Property in violation of the Loan Documents, or (B) files a
voluntary petition for reorganization under Title I I of the United
States Code (or under any other present or future law, domestic or
foreign, relating to bankruptcy, insolvency, reorganization
proceedings or otherwise similarly affecting the rights of
creditors), and has not offered, prior to the filing, to enter into
the Lender’s choice of either an agreement to permit an uncontested
foreclosure, or an agreement to deliver a deed in lieu of foreclosure
within sixty (60) days of the Lender’s acceptance of the offer. After
the Lender accepts such an offer, default by the Borrower in
fulfilling the terms of the accepted offer shall trigger personal
liability for the entire Indebtedness. No such offer shall be
conditioned on any payment by the Lender, on the release of any
Obligor from any Obligation, or on any other concession.

22. SECURITY AGREEMENT AND FIXTURE FILING

22.1 DEFINITIONS

"Account” shall have the definition assigned in the UCC.

“Bank” shall have the meaning assigned in the UCC.

“Chattel Paoer” shall have the definition assigned in the UCC.

“Deposit Account” shall have the definition assigned in the UCC.

“Document” shall have the definition assigned in the UCC.

“Eauioment” shall have the definition assigned in the UCC.

“Financing Statements” shall have the definition assigned in the
UCC.

“General Intangibles” shall have the definition assigned in the
UCC.

“Goods” shall have the definition assigned in the UCC. “Goods”
include all detached Fixtures, items of Personal Property that may become
Fixtures, property management files, accounting books and records, reports
of consultants relating

to the Real Property, site plans, test borings, environmental or
geotechnical surveys, samples and test results, blueprints, construction
and shop drawings, and plans and specifications.

“Instrument” shall have the definition assigned in the UCC.

“Investment Property” shall have the definition assigned in the
UCC.

“Letter-of-Credit” shall have the definition assigned in the UCC.

“Letter-of-Credit Rights” shall have the definition assigned in
the UCC.

“Money Collateral” means all money received in respect of Rents.

“Personal Property” means Accounts, Chattel Paper, Commercial Tort
Claims, Deposit Accounts, Documents, Equipment, Goods, Instruments,
General Intangibles, Investment Property, Letter-of-Credit Rights, Letters
of Credit, and Money Collateral.

“Proceeds” shall have the meaning assigned in the UCC.

“UCC” means the Uniform Commercial Code as adopted in North
Carolina.

22.2 CREATION OF SECURITY MEREST

This Deed of Trust shall be self-operative and shall constitute a Security
Agreement pursuant to the provisions of the UCC with respect to the
Personal Property. The Borrower, as debtor, hereby grants the Lender, as
secured party, for the purpose of securing the Indebtedness, a security
interest in the Accounts, Chattel Paper, Commercial Tort Claims, Deposit
Accounts, Documents, Goods, Equipment, Instruments, General Intangibles,
Investment Property, Letter-of-Credit Rights, Letters of Credit, and Money
Collateral, in the accessions, additions, replacements, substitutions and
Proceeds of any of the foregoing items of collateral. Upon Default, the
Lender shall have the rights and remedies of a secured party under the UCC
as well as all other rights and remedies available at law or in equity,
and, at the Lender’s option, the Lender may also invoke the remedies
provided elsewhere in this Deed of Trust as to such Property. The Borrower
and the Lender agree that the rights granted to the Lender as secured
party under this Section 22 are in addition to rather than a limitation on
any of the Lender’s other rights under this Deed of Trust with respect to
the Property.

22.3 FILING AUTHOREATION

The Borrower irrevocably authorizes the Lender to file, in the appropriate
locations for filings of UCC financing statements in any jurisdictions as
the Lender in good faith deems appropriate, such financing statements and
amendments as the Lender may require in order to perfect or continue this
security interest, or in order to prevent any filed financing statement
from becoming misleading or from losing its perfected status.

22.4 ADDITIONAL SEARCHES AND DOCUMENTATION

The Borrower shall provide to the Lender upon request, certified copies of
any searches of UCC records deemed necessary or appropriate by Lender to
confirm the first-priority status of its security interest in the Personal
Property, together with copies of all documents or records evidencing
security interests disclosed by such searches.

22.5 COSTS

The Borrower shall pay all filing fees and costs and all reasonable costs
and expenses of any record searches (or their continuations) as the Lender
may require.

	 	 	 
	22.6

	 	REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE

BORROWER

(a) Ownership of the Personal Property

All of the Personal Property is, and shall during the term of the
Loan continue to be, owned by the Borrower, and is not the subject
matter of any lease, control agreement or other instrument,
agreement or transaction whereby any ownership, security or
beneficial interest in the Personal Property is held by any person
or entity other than the Borrower, subject only to (1) the
Lender’s security interest, (2) the rights of tenants occupying
the Property pursuant to Leases approved by the Lender, and (3)
the Permitted Encumbrances.

(b) No Other Identity

The Borrower represents and warrants that the Borrower has not
used or operated under any other name or identity for at least
five (5) years. The Borrower covenants and agrees that Borrower
will furnish Lender with notice of any change in its name, form of
organization, or state of organization within thirty (30) days
prior to the effective date qf any such change.

(c) Location of Equipment

All Equipment is located upon the Land.

(d) Removal of Goods

The Bonower will not remove or permit to he removed any item
included in the Goods from the Land, unless the same is replaced
immediately with unencumbered Goods (1) of a quality and value
equal or superior to that which it replaces and (2) which is
located on the Land. All such replacements, renewals, and
additions shall become and be immediately subject to the security
interest of this Deed of Trust.

(e) Proceeds

The Borrower may, without the Lender’s prior written consent,
dispose of Goods in the ordinary course of business, provided
that, following the disposition, the perfection of the Lender’s
security interest in the Proceeds of the disposition will continue
under $9-315 (d) of the UCC. The Borrower shall not, without the
Lender’s prior written consent, dispose of any Personal Property
in any other manner, except in compliance with Paragraph (d) of
this Subsection 22.6.

22.7 FIXTURE FILING

This Deed of Trust constitutes a financing statement filed as a fixture
filing in the Official Records of the Register of Deeds of Mecklenburg
County, North Carolina, with respect to any and all fixtures comprising
Property. The “debtor” is Braemar Housing Limited Partnership, a limited
partnership organized under Ohio law; the “secured party” is Transamerica
Occidental Life Insurance Company, an Iowa corporation; the collateral is
as described in Subsection 22.1 above and the granting clause of this Deed
of Trust; and the addresses of the debtor and secured party are the
addresses stated in Subsection 26.13 of this Deed of Trust for Notices to
such parties. The organizational identification number of the debtor is
LP13929. The owner of record of the Real Property is Braemar Housing
Limited Partnership.

23. ENVIRONMENTAL MATTERS

23.1 REPRESENTATIONS

The Borrower represents as follows:

(a) No Hazardous Substances

To the best of the Borrower’s knowledge as a duly diligent
property owner, and except as disclosed in the ESA, no release of
any Hazardous Substance has occurred on or about the Real Property
in a quantity or at a concentration level that (i) violates any
Environmental Law, or (ii) requires reporting to any regulatory
authority or may result in any obligation to remediate under any
Environmental Law.

(b) Compliance with Environmental Laws

The Real Property and its current use and presently anticipated
uses comply with all Environmental Laws, including those requiring
permits, licenses, authorizations, and other consents and
approvals.

(c) No Actions or Proceedings

No governmental authority or agency has commenced any action,
proceeding or investigation based on any suspected or actual
violation of any Environmental Law on or about the Real Property.
To the best of the Borrower’s knowledge as a duly diligent
property owner, no such authority or agency has threatened to
commence any such action, proceeding, or investigation.

23.2 ENVIROMNTAL COVENANTS

The Borrower covenants as follows:

(a) Compliance with Environmental Laws

The Borrower shall, and the Borrower shall cause all employees,
agents, contractors, and tenants of the Borrower and any other
persons present on or occupying the Real Property to, keep and
maintain the Real Property in compliance with all Environmental
Laws.

(b) Notices, Actions and Claims

The Borrower shall immediately advise the Lender in writing of (i)
any notices from any governmental or quasi-governmental agency or
authority of violation or potential violation of any Environmental
Law received by the Borrower, (ii) any and all enforcement,
cleanup, removal or other governmental or regulatory actions
instituted, completed or threatened pursuant to any Environmental
Law, (iii) all claims made or threatened by any third party
against the Borrower or the Real Property relating to damage,
contribution, cost recovery, compensation, loss or injury
resulting from any Hazardous Substances, and (iv) discovery by the
Borrower of any occurrence or condition on any real property
adjoining or in the vicinity of the Real Property that creates a
foreseeable risk of contamination of the Real Property by or with
Hazardous Substances.

23.3 THE LENDER’S RIGHT TO CONTROL CLAIMS

The Lender shall have the right (but not the obligation) to join and
participate in, as a party if it so elects, any legal proceedings or
actions initiated in connection with any Hazardous Substances and to have
its related and reasonable attorneys’ and consultants’ fees paid by the
Borrower upon demand.

23.4 INDEMNIFICATION

The Borrower shall be solely responsible for, and shall indemnify, defend,
and hold harmless the Lender, the Trustee, and their respective directors,
officers, employees, agents, successors and assigns, from and against, any
claim, judgment, loss, damage, demand, cost, expense or liability of
whatever kind or nature, known or unknown, contingent or otherwise,
directly or indirectly arising out of or attributable to the use,
generation, storage, release, threatened release, discharge, disposal, or
presence (whether prior to or after the date of this Deed of Trust) of
Hazardous Substances on, in, under or about the Real Property (whether by
the Borrower, a predecessor in title, any tenant, or any employees,
agents, contractor or subcontractors of any of the foregoing or any third
persons at any time occupying or present on the Real Property), including:
(i) personal injury; ii) death; (iii) damage to property; (iv) all
consequential damages; (v) the cost of any required or necessary repair,
cleanup or detoxification of the Real Property, including the soil and
ground water thereof, and the preparation and implementation of any
closure, remedial or other required plans; (vi) damage to any natural
resources; and (vii) all reasonable costs and expenses incurred by the
Lender or the Trustee in connection with clauses (i) through (vi),
including reasonable attorneys’ and consultants’ fees; provided.
however, that nothing contained in this Section shall be deemed to
preclude the Borrower from seeking indemnification from, or otherwise
proceeding against, any third party including any tenant or predecessor in
title to the Real Property, and further provided that this
indemnification will not extend to matters caused by the Lender’s gross
negligence or willful misconduct, or arising from a release of Hazardous
Substances which occurs after the Lender has taken possession of the Real
Property, so long as the Borrower has not caused the release through any
act or omission. The covenants, agreements, and indemnities set forth in
this Section shall be binding upon the Borrower and its heirs, personal
representatives, successors and assigns, and shall survive repayment of
the Indebtedness, foreclosure of the Real Property, and the Borrower’s
granting of a deed to the Real Property. Payment shall not be a condition
precedent to this indemnity. Any costs or expenses incurred by the Lender
or the Trustee for which the Borrower is responsible or for which the
Borrower has indemnified the Lender shall be paid to the Lender on demand,
with interest at the Default Rate from the date incurred by the Lender
until paid in full, and shall be secured by this Deed of Tmst. Without
the prior written consent of the Lender, the Borrower shall not enter into
any settlement agreement, consent decree, or other compromise in respect
to any claims relating to Hazardous Substances. The Lender agrees that it
shall not unreasonably delay its consideration of any written request for
its consent to any such settlement agreement, consent decree, or other
compromise once all information, reports, studies, audits, and other
documentation have been submitted to the Lender.

23.5 ENVIRONMENTAL AUDITS

If a Default exists, or at any time the Lender has reason to believe that
a release of Hazardous Substances may have occurred or may be likely to
occur, the Lender may require that the Borrower retain, or the Lender may
retain directly, at the sole cost and expense of the Borrower, a licensed
geologist, industrial hygienist or an environmental consultant acceptable
to the Lender to conduct an environmental assessment or audit of the Real
Property. In the event that the Lender makes a reasonable determination of
the need for an environmental assessment or audit, the Lender shall inform
the Borrower in writing that such a determination has been made and, if
requested to do so by the Borrower, give the Borrower a written
explanation of that determination before the assessment or audit is
conducted. The Borrower shall afford any person conducting an
environmental assessment or audit access to the Real Property and all
materials reasonably requested. The Borrower shall pay on demand the cost
and expenses of any environmental consultant engaged by the Lender under
this Subsection. The Borrower shall, at the Lender’s request and at the
Borrower’s sole cost and expense, take such investigative and remedial
measures the Lender determines to be necessary to address any condition
discovered by the assessment or audit so that (i) the Real Property shall
be in compliance with all Environmental Laws, (ii) the condition of the
Real Property shall not constitute any identifiable risk to human health
or to the environment, and (iii) the value of the Real Property shall not
be affected by the presence of Hazardous Substances.

24. CONCERNING THE TRUSTEE

The Trustee will not be liable for any error of judgment or act, or be otherwise
responsible or accountable under any circumstances. If the Trustee or anyone acting
by virtue of the Trustee’s powers enters the Real Property, the Trustee will not be
personally liable for debts contracted or for liability or damages incurred in the
management or operation of the Real Property. The Trustee will have the right to
rely on any instrument, document or signature authorizing or supporting any action
taken or proposed to be taken by the Trustee or believed by the Trustee in good
faith to be genuine. The Trustee will be entitled to reimbursement from the
Borrower for expenses actually incurred by the Trustee in the performance of the
Trustee’s duties and to reasonable compensation for services rendered following
Default, which, in the event of a nonjudicial foreclosure sale, shall not exceed
five percent (5%) of the gross proceeds of the sale. The Borrower shall, from time
to time, save and hold the Trustee harmless from and against any and ail loss,
cost, liability, damage and expense whatsoever incurred by the Trustee in the
performance of the Trustee’s duties.

24.2 RETENTION OF MONEY

All money received by the Trustee must, until used or applied, be held in
trust for the purposes for which it was received, but need not be
segregated in any manner from any other money (except to the extent
required by law) and the Trustee will have no liability for interest on
any money received.

24.3 SUCCESSOR TRUSTEES

The Trustee may resign by giving notice of such resignation in writing to
the Lender. If the Trustee dies, resigns or becomes disqualified from
acting in the execution of this Trust or fails or refuses to exercise the
same when requested by the Lender so to do or if for any reason and
without cause the Lender prefers to appoint a substitute trustee to act
instead of the original Trustee, or any prior successor or substitute
trustee, the Lender will have full power to appoint a substitute trustee
and, if preferred, several substitute trustees in succession who shall
succeed to all the estates, rights, powers and duties of the Trustee. Any
new Trustee appointed will, without any further act, deed or conveyance,
become vested with all the estates, properties, rights, powers and trusts
of the Trustee’s predecessor. Upon the written request of the Lender or of
any successor trustee, the former Trustee shall execute and deliver an
instrument transferring to such successor Trustee all the estates,
properties, rights, powers and trusts of the former Trustee, and shall
duly assign, transfer and deliver any of the property and money held by
the former Trustee to the successor Trustee so appointed in the former
Trustee’s place.

24.5 PERFORMANCE OF DUTIES BY AGENTS

The Trustee may authorize one or more parties to act on the Trustee’s
behalf to perform the Trustee’s ministerial functions, including, without
limitation, the transmittal and posting of any notices.

25. SECONDARY MARKET

25.1 DISSEMINATION OF INFORMATION

In connection with any transfer of the Loan, the Lender may forward all
documents and information that the Lender deems necessary or desirable
concerning the Loan, including the financial statements of any Obligor,
and such other information as may be reasonably related to the Obligors,
the Property or the Leases to any:

(a) transferee or prospective transferee of the Loan;

(b) Rating Agency rating the Loan, a Participation, or Securities; or

	 	(c)	 	purchaser, transferee, assignee, servicer,
participant, investor in any securitization and each prospective
investor and the advisor of each of he foregoing, all documents and
information which Lender now has or may hereafter acquire relating to
the Loan, to any Obligor and to the Real Property, as Lender
determines necessary or desirable.

The Borrower irrevocably waives any and all rights it may have under
applicable Legal Requirements to prohibit such disclosure, including any
right of privacy.

25.2 COOPERATION

The Borrower, any guarantor and any Carveout Obligor agree to cooperate
with the Lender in connection with any transfer of the Loan or any
Participation or Securities. The Borrower agrees to provide to the Lender
or to any persons to whom the Lender may disseminate such information, at
the Lender’s request, financial statements of Obligors, an estoppel
certificate and such other documents as may be reasonably related to the
Obligors, the Property, or the Leases

25.3 ADDTIONAL FINANCIAL INFORMATION

If a decision is made to include the Loan in a Securitization and the
amount of the Loan would exceed 20% of the amount estimated in good faith
to be raised in the offering, the Borrower agrees to provide, to the
extent required by SEC Regulation S-X Rule 3-14, and to the extent not
previously supplied to Lender, financial statements for the Real Property
in respect of the three years prior to the Securitization. If the amount
of the Loan would exceed 10% (but not 20%) of the amount estimated in good
faith to be raised by the offering, the Borrower agrees to provide such
additional property-related financial information as the Lender may
request in order to meet then-applicable SEC rules in connection with the
contemplated manner of the offering.

25.4 RESERVES/ESCROWS

If Participations are granted or Securities issued in connection with the
Loan, all finds held by the Lender in escrow or as reserves in accordance
with the Loan Documents may, at the Lender’s discretion, be deposited in
“eligible accounts” at “eligible institutions” and invested in “permitted
investments” as then defined and required by the Rating Agencies.

26. MISCELLANEOUS

26.1 SUCCESSORS AND ASSIGNS

All of the terms of the Loan Documents shall apply to, be binding upon and
inure to the benefit of the heirs, personal representatives, successors
and assigns of the Obligors, or to the holder of the Note, as the case may
be.

26.2 SURVIVAL OF OBLIGATIONS

Each and all of the Obligations shall continue in full force and effect
until the latest of (a) the date the Indebtedness has been paid in full
and the Obligations have been performed and satisfied in full, (b) the
last date permitted by law for bringing any claim or action with respect
to which the Lender may seek payment or indemnification in connection with
the Loan Documents, and (c) the date on which any claim or action for
which the Lender seeks payment or indemnification is fully and finally
resolved and, if applicable, any compromise thereof ofjudgment or award
thereon is paid in fill.

26.3 FURTHER ASSURANCES

The Borrower, upon the request of the Lender or the Trustee, shall
complete, execute, acknowledge, deliver and record or file such further
instruments and do such further acts as may be necessary to cany out more
effectively the purposes of this Deed of Trust, to subject any property
intended to be covered by this Deed of Trust to the liens and security
interests it creates, to place third parties on notice of those liens and
security interests, or to correct any defects which may be found in any
Loan Document.

26.4 RIGHT OF INSPECTION

The Lender shall have the right from time to time, upon reasonable advance
notice to the Borrower, to enter onto the Real Property for the purpose of
inspecting and reporting on its physical condition, tenancy and
operations.

26.5 EXPENSE INDEMNIFICATION

The Borrower shall pay all filing and recording fees, documentary stamps,
intangible taxes, and all expenses incident to the execution and
acknowledgment of this Deed of Trust, the Note or any of the other Loan
Documents, any supplements, amendments, renewals or extensions of any of
them, or any instrument entered into under Subsection 26.3. The Borrower
shall pay or reimburse the Lender, upon demand, for all costs and
expenses, including appraisal and reappraisal costs of the Property and
reasonable attorneys’ and legal assistants’ fees, which the Lender may
incur in connection with enforcement proceedings under the Note, this Deed
of Trust, or any of the other Loan Documents (including all fees and costs
incurred in enforcing or protecting the Note, this Deed of Trust, or any
of the other Loan Documents in any bankruptcy proceeding), and attorneys’
and legal assistants’ fees incurred by the Lender in any other suit,
action, legal proceeding or dispute of any kind in which the Lender is
made a party or appears as party plaintiff or defendant, affecting the
Indebtedness, the Note, this Deed of Trust, any of the other Loan
Documents, or the Property, or required to protect or sustain the lien of
this Deed of Trust. The Borrower shall be obligated to pay (or to
reimburse the Lender) for such fees, costs and expenses and shall
indemnify and hold the Lender and the Trustee harmless from and against
any and all loss, cost, expense, liability, damage and claims and causes
of action, including attorneys’ fees, incurred or accruing by reason of
the Borrower’s failure to promptly repay any such fees, costs and
expenses. If any suit or action is brought to enforce or interpret any of
the terms of this Deed of Trust (including any effort to modify or vacate
any automatic stay or injunction, any trial, any appeal, any petition for
review or any bankruptcy proceeding), the Lender shall be entitled to
recover all expenses reasonably incurred in preparation for or during the
suit or action or in connection with any appeal of the related decision,
whether or not taxable as costs. Such expenses include reasonable
attorneys’ fees, witness fees (expert or othenvise), deposition costs,
copying charges and other expenses. Whether or not any court action is
involved, all reasonable expenses, including the costs of searching
records, obtaining title reports, appraisals, environmental assessments,
surveying costs, title insurance premiums, trustee fees, and other
reasonable attorneys’ fees, incurred by the Lender that are necessary at
any time in the Lender’s opinion for the protection of its interest or
enforcement of its rights shall become a part of the Indebtedness payable
on demand and shall bear interest from the date of expenditure until
repaid at the interest rate as provided in the Note.

26.6 GENERAL INDEMNIFICATION

The Borrower shall indemnify, defend and hold the Lender harmless against:
(i) any and all claims for brokerage, leasing, finder’s or similar fees
which may be made relating to the Real Property or the Indebtedness and
(ii) any and all liability, obligations, losses, damages, penalties,
claims, actions, suits, costs and expenses (including the Lender’s
reasonable attorneys’ fees, together with reasonable appellate counsel
fees, if any) of whatever kind or nature which may he asserted against,
imposed on or incurred by the Lender in connection with the Indebtedness,
this Deed of Trust, the Real Property or any part thereof, or the
operation, maintenance and/or use thereof, or the exercise by the Lender
of any rights or remedies granted to it under this Deed of Trust or
pursuant to applicable law; provided, however, that nothing herein shall
be construed to obligate the Borrower to indemnify, defend and hold
harmless the Lender from and against any of the foregoing which is imposed
on or incurred by the Lender by reason of the Lender’s willful misconduct
or gross negligence.

26.7 RECORDING AND FILING

The Borrower shall cause this Deed of Trust and all amendments,
supplements, and substitutions to be recorded, filed, re-recorded and
re-filed in such manner and in such places as the Lender may reasonably
request. The Borrower will pay all recording filing, re-recording and
re-filing taxes, fees and other charges.

26.8 NO WAIVER

No deliberate or unintentional failure by the Lender to require strict
performance by the Borrower of any Obligation shall be deemed a waiver,
and the Lender shall have the right at any time to require strict
performance by the Borrower of any Obligation.

26.9 COVENANTS RUNNING WITH THE LAND

All Obligations are intended by the parties to he and shall be construed
as covenants running with the Land.

26.10 SEVERABILITY

The Loan Documents are intended to be performed in accordance with, and
only to the extent permitted by, all applicable Legal Requirements. Any
provision of the Loan Documents that is prohibited or unenforceable in any
jurisdiction shall nevertheless be construed and given effect to the
extent possible. The invalidity or unenforceability of any provision in a
particular jurisdiction shall neither invalidate nor render unenforceable
any other provision of the Loan Documents in that jurisdiction, and shall
not affect the validity or enforceability of that provision in any other
jurisdiction. If a provision is held to be invalid or unenforceable as to
a particular person or under a particular circumstance, it shall
nevertheless he presumed valid and enforceable as to others, or under
other circumstances.

26.11 USURY

The parties intend that no provision of the Note or the Loan Documents he
interpreted, construed, applied, or enforced so as to permit or require
the payment or collection of interest in excess of the Maximum Permitted
Rate. In this regard, the Borrower and the Lender each stipulate and agree
that it is their common and overriding intent to contract in strict
compliance with applicable usury laws. Accordingly, none of the terms of
this Deed of Trust, the Note or any of the other Loan Documents shalt ever
be construed to create a contract to pay, as consideration for the use,
forbearance or detention of money, interest at a rate in excess of the
Maximum Permitted Rate, and the Borrower shall never be liable for
interest in excess of the Maximum Permitted Rate. Therefore, (a) in the
event that the Indebtedness and Obligations are prepaid or the maturity of
the Indebtedness and Obligations is accelerated by reason of an election
by the Lender, unearned interest shall be canceled and, if theretofore
paid, shall either be refunded to the Borrower or credited on the
Indebtedness, as the Lender may elect; (b) the aggregate of all interest
and other charges constituting interest under applicable laws and
contracted for, chargeable or receivable under the Note and the other Loan
Documents or otherwise in connection with the transaction contemplated
thereby shall never exceed the maximum amount of interest, nor produce a
rate in excess of the Maximum Permitted Rate; and (c) if any excess
interest is provided for or received, it shall be deemed a mistake, and
the same shall, at the option of the Lender, either be refunded to the
Borrower or credited on the unpaid principal amount (if any), and the
Indebtedness shall be automatically reformed so as to permit only the
collection of the interest at the Maximum Permitted Rate. Furthermore, if
any provision of the Note or any of the other Loan Documents is
interpreted, construed, applied, or enforced, in such a manner as to
provide for interest in excess of the Maximum Permitted Rate, then the
parties intend that such provision automatically shall be deemed reformed
retroactively so as to require payment only of interest at the Maximum
Permitted Rate. If, for any reason whatsoever, interest paid or received
during the full term of the applicable Indebtedness produces a rate which
exceeds the Maximum Permitted Rate, then the amount of such excess shall
be deemed credited retroactively in reduction of the then outstanding
principal amount of the Indebtedness, together with interest at such
Maximum Permitted Rate. The Lender shall credit against the principal of
such Indebtedness (or, if such Indebtedness shall have been paid in full,
shall refund to the payor of such interest) such portion of said interest
as shall be necessary to cause the interest paid to produce a rate equal
to the Maximum Permitted Rate. All sums paid or agreed to be paid to the
Lender for the use, forbearance or detention of money shall, to the extent
permitted by applicable law, be amortized, prorated, allocated and spread
in equal parts throughout the full term of the applicable Indebtedness, so
that the interest rate is uniform throughout the full term of such
Indebtedness. In connection with all calculations to determine the
Maximum Permitted Rate, the parties intend that all charges be excluded to
the extent they are properly excludable under applicable usury laws, as
they from time to time are determined to apply to this transaction. The
provisions of this Section shall control all agreements, whether now or
hereafter existing and whether written or oral, between the Borrower and
the Lender.

26.12 ENTIRE AGREEMENT

The Loan Documents contain the entire agreements between the parties
relating to the financing of the Real Properly, and all prior agreements
which are not contained in the Loan Documents, other than the
Environmental Indemnity Agreement, are terminated. The Loan Documents
represent the fmal agreement between the parties and may not be
contradicted by evidence of prior, contemporaneous, or subsequent oral
agreements of the parties. There are no unwritten oral agreements between
the parties. The Loan Documents may be amended, revised, waived,
discharged, released or terminated only by a written instrument or
instruments executed by the party against whom enforcement of the
amendment, revision, waiver, discharge, release or termination is
asserted. Any alleged amendment, revision, waiver, discharge, release or
termination that is not so documented shall be null and void.

26.1 3 NOTICES

In order for any demand, consent, approval or other communication to be
effective under the terms of this Deed of Trust, “Notice” must be provided
under the terms of this Subsection. All Notices must be in writing.
Notices may be (a) delivered by hand, (b) transmitted by facsimile (with a
duplicate copy sent by first class mail, postage prepaid), (c) sent by
certified or registered mail, postage prepaid, return receipt requested,
or (d) sent by reputable overnight courier service, delivery charges
prepaid. Notices shall be addressed as set forth below:

If to the Lender:

Transamerica Occidental Life Insurance Company

C/O AEGON USA Realty Advisors, Inc.

4333 Edgewood Road, N.E.

Cedar Rapids, Iowa 52499-5443

Attn: Mortgage Loan Department

Reference: Loan #89441

Fax Number: (3 19) 369-2277

If to the Borrower:

Braemar Housing Limited Partnership

c/o Levin Development

3 103 Camden Drive

Troy, Michigan 48084

Fax Number: (248) 588-4455

with a copy of any Notice of default or acceleration to:

Kenneth F. Silver

Hertz, Schram & Saretsky, P.C.

1760 South Telegraph Road, Suite 300

Bloomfield Hills, Michigan 48302

Fax Number: (248) 335-3346

If to the Trustee:

J. Lindsay Stradley, Jr.

945 East Paces Ferry Road, Suite 2700

Atlanta, Georgia 30326-1380

Fax Number: (404) 923-9099

Notices delivered by hand or by overnight courier shall be deemed given
when actually received or when refused by their intended recipient.
Notices sent by facsimile will be deemed delivered when a legible copy has
been received (provided receipt has been verified by telephone
confirmation or one of the other permitted means of giving Notices under
this Subsection). Mailed Notices shall be deemed given on the date of the
first attempted delivery (whether or not actually received). The Lender,
the Trustee or the Borrower may change its address for Notice by giving at
least fifteen (15) Business Days’ prior Notice of such change to the other
parties.

26.14 COUNTERPARTS

This Deed of Trust may be executed in any number of counterparts, each of
which shall be an original, but all of which together shall constitute but
one instrument.

26.15 CHOICEOFLAW

This Deed of Trust shall be interpreted, construed, applied, and enforced
according to, and will be governed by, the laws of North Carolina, without
regard to any choice of law principle which, but for this provision, would
require the application of the law of another jurisdiction and regardless
of where executed or delivered, where payable or paid, where any cause of
action accrues in connection with this transaction, where any action or
other proceeding involving the Loan is instituted, or whether the laws of
North Carolina otherwise would apply the laws of another jurisdiction.

26.1 6 FORUM SELECTION

The Borrower agrees that the sole and exclusive forum for the
determination of any action relating to the validity and enforceability of
the Note, this Deed of Trust and the other Loan Documents, and any other
instruments securing the Note shall be either in an appropriate wurt of
the State of North Carolina or the applicable United States District
Court.

26.17 SOLE BENEFIT

This Deed of Trust and the other Loan Documents have been executed for the
sole benefit of the Borrower, the Trustee, Guarantors and the Lender and
the successors and assigns of the Lender. No other party shall have rights
thereunder or be entitled to assume that the parties thereto will insist
upon strict performance of their mutual obligations hereunder, any of
which may be waived from time to time. Neither the Borrower nor Guarantors
shall have any right to assign any of its rights under the Loan Documents
to any party whatsoever.

26.18 RELEASE OF CLAIMS

To the fullest extent permitted by applicable laws, the Borrower hereby
RELEASES, DISCHARGES and ACQUITS forever the Lender and the Trustee and
their officers, directors, trustees, agents, employees and counsel (in
each case, past, present or future) from any and all Claims existing as of
the date hereof (or the date of actual execution hereof by the Borrower,
if later). As used herein, the term “Claim” shall mean any and all
liabilities, claims, defenses, demands, actions, causes of action,
judgments, deficiencies, interest, liens, costs or expenses (including
court costs, penalties, attorneys’ fees and disbursements, and amounts
paid in settlement) of any kind and character whatsoever, including claims
for usury, breach of contract, breach of commitment, negligent
misrepresentation or failure to act in good faith, in each case whether
now known or unknown, suspected or unsuspected, asserted or unasserted or
primary or contingent, and whether arising out of written documents,
unwritten undertakings, course of conduct, tort, violations of laws or
regulations or otherwise.

26.19 NO PARTNERSHIP

Nothing contained in the Loan Documents is intended to create any
partnership, joint venture or association between the Borrower and the
Lender, or in any way make the Lender a co-principal with the Borrower
with reference to the Property.

26.20 PAYOFF PROCEDURES

If the Borrower pays or causes to be paid to the Lender all of the
Indebtedness, then the Trustee’s interest in the Real Property shall
cease, and upon receipt by the Lender of such payment, the Lender shall
release this Deed of Trust.

26.2 1 SURVIVAL OF COMMRMENT TERMS

The Commitment shall survive the execution of this Deed of Trust and the
other Loan Documents. Any term of the Commitment that has been
inadvertently omitted from the Loan Documents is hereby incorporated in
this Deed of Trust by reference. If any term of the Commitment conflicts
with a provision of this Deed of Trust that addresses the same subject,
the terms of this Deed of Trust shall prevail. Any provision of the
Commitment which specifically states that it shall survive the closing of
the Loan shall so survive, and is hereby incorporated in this Deed of
Trust by reference.

26.22 FUTURE ADVANCES

This Deed of Trust secures (a) all present and future loan disbursements
made by the Lender under the Note, and (b) all other sums from time to
time owing to the Lender under the Loan Documents. The amount of the
present disbursement secured hereby is $10,000,000, and the maximum
principal amount which may be secured hereby at any one time is
$20,000,000. The time period within which such future disbursements are to
be made is the period between the date of this Deed of Trust and the date
which is ten (10) years from the date of this Deed of Trust. Disbursements
secured hereby shall not be required to be evidenced by a “written
instrument or notation” as described in Section 45-68 (2) of the North
Carolina General Statutes, it being the intent of tbe parties that the
requirements of Section 45-68 (2) for a “written instrument or notation”
for each advance shall not be applicable to disbursements made under the
Deed of Trust and Note.

26.23 INTERPRETATION

(a) Headings and General Application

The section, subsection, paragraph and subparagraph headings of
this Deed of Trust are provided for convenience of reference only
and shall in no way affect, modify or define, or be used in
construing, the text of the sections, subsections, paragraphs or
subparagraphs. If the text requires, words used in the singular
shall be read as including the plural, and pronouns of any gender
shall include all genders.

(b) Sole Discretion

The Lender may take any action or decide any matter under the
terms of this Deed of Trust or of any other Loan Document
(including any consent, approval, acceptance, option, election or
authorization) in its sole and absolute discretion, for any reason
or for no reason, unless the related Loan Document contains
specific language to the contrary. Any approval or consent that
the Lender might withhold may be conditioned in any way.

(c) Result of Negotiations

This Deed of Trust results from negotiations between the Borrower
and the Lender and from their mutual efforts. Therefore, it shall
be so construed, and not as though it had been prepared solely by
the Lender.

(d) Reference to Particulars

The scope of a general statement made in this Deed of Trust or in
any other Loan Document shall not be construed as having been
reduced through the inclusion of references to particular items
that would be included within the statement’s scope. Therefore,
unless the relevant provision of a Loan Document contains specific
language to the contrary, the term “include” shall mean “include,
but shall not be limited to” and the term “including” shall mean
“including, without limitation.”

26.24 JOINT AND SEVERAL LIABILITY

If there is more than one individual or entity executing this Deed
of Trust as the Borrower, liability of such individuals and
entities under this Deed of Trust shall be joint and several.

26.25 TIME OF ESSENCE

Time is of the essence of each and every covenant, condition and
provision of this Deed of Trust to be performed by the Borrower.

26.26 RENEWAL, EXTENSION, MODIFICATION AND WAIVER

The Lender, at its option, may at any time renew or extend this
Deed of Trust, the Note or any other Loan Document. The Lender may
enter into a modification of any Loan Document or of the
Environmental Indemnity Agreement without the consent of any
person not a party to the document being modified. The Lender may
waive any covenant or condition of any Loan Document or of the
Environmental Indemnity Agreement, in whole or in part, at the
request of any person then having an interest in the Property or
in any way liable for any part of the Indebtedness. The Lender may
take, release, or resort to any security for the Note and the
Obligations and may release any party primarily or secondarily
liable on any Loan Document or on the Environmental Indemnity
Agreement, all without affecting any liability not expressly
released in writing by the Lender.

26.27 CUMULATNREE MEDIES

Every right and remedy provided in this Deed of Trust shall be
cumulative of every other right or remedy of the Lender, whether
conferred by law or by grant or contract, and may be enforced
concurrently with any such right or remedy. The acceptance of the
performance of any obligation to cure any Default shall not he
construed as a waiver of any rights with respect to any other
past, present or future Default. No waiver in a particular
instance of the requirement that any Obligation be performed shall
be construed as a waiver with respect to any other Obligation or
instance. Furthermore, the Borrower hereby waives any rights or
remedies on account of any extensions of time, releases granted,
or other dealings between the Lender and any subsequent owner of
the Property as such activities

are contemplated or otherwise addressed in N.C. Gen. Stat.
Sections 45-45.1 or any similar or subsequent law.

26.28 NO OBLIGATION TO MARSHAL ASSETS

No holder of any deed of trust, security interest or other
encumbrance affecting all or any portion of the Real Property,
which encumbrance is inferior to the title and security title of
this Deed of Trust, shall have any right to require the Lender to
marshal assets.

26.29 TRANSFER OF OWNERSHIP

The Lender may, without notice to the Borrower, deal with any person
in whom ownership of any part of the Real Property has vested, without in
any way vitiating or discharging the Borrower from liability for any of
the Obligations.

IN WITNESS WHEREOF, the Borrower has caused this Deed of Trust to be duly executed under seal as of
the date first above written.

BRAEMAR HOUSING LIMITED

PARTNERSHIP, an Ohio limited partnership

[SEAL]

	 	 	 	 	 
	By:

	 	Treybum Housing, LLC, an Ohio
	 	

	 	 	limited liability company, its sole
	
 
	 	General Partner [SEAL]
	 	

	
 
	 	By:
	 	LPS Investments, L.L.C., a

Michigan limited liability

company, its sole Managing

Member [SEAL]
	
 
	 	 	 	By: /s/ Phillip I. Levin[SEAL]
	
 
	 	 	 	 
	
 
	 	 	 	Phillip I. Levin, Manager

2

STATEOF Michigan

COUNTY OF Oakland

I, Shelly M. Rayment, Notary Public of the County and State aforesaid, do hereby certify
that Phillip I. Levin personally came before me this day and after being duly sworn, said that he
is the Manager of LPS Investments, L.L.C., a Michigan limited liability company, which is the sole
Managing Member of Treyburn Housing, LLC, an Ohio limited partnership, which is the sole General
Partner of Braemar Housing Limited Partnership, an Ohio limited partnership, and that this
instrument was signed and sealed by him, on behalf of the aforementioned limited liability
companies and limited partnership by their authority duly given, and further acknowledged this
instrument to be the act and deed of the aforementioned limited liability companies and limited
partnership.

WITNESS my hand and official stamp or seal, this 25 day of      May     ,
2005.

_/s/ Shelly M. Rayment     

Notary Public

My Commission Expires:

     

[SHELLY M. RAYMENT

NOTARY PUBLIC STATE OF MICHIGAN GENESSEE
COUNTY

ACTING IN:

OAKLAND COUNTY

MY COMMISSION EXP. JUNE 27, 2005]

3

EXHIBIT A

THE LAND

That certain tract located in Long Creek Township, Mecklenburg County, North Carolina, and being
more particularly described as follows:

Beginning at a found #4 rebar along the southern right-of-way line of Vance Road (SR 21 13), a 60’
public right-of-way, a common comer with Russell Kakaley (Deed Book 4263 Page 175); thence with the
west line of Russell Kakaley the following three (3) courses: 1) S 37°41’42” W 188.44 feet to a
found iron pipe; 2) S 24’01’37” W 445.09 feet to a found 314” square pipe; 3) S
27o46’39” W 11 1.27 feet to a found #4 rebar, a common comer with Russell Kakaley and
Floreine F. Burt Family Limited Partnership (Deed Book 10993 Page 139); thence with the west line
of Floreine F. Burt Family Limited Partnership the following two (2) courses: 1) S 03“3 1’39” E
173.20 feet to a found #4 rebar; 2) S 13°36’32” E 110.76 feet to a set #4 rebar, a common comer
with area dedicated to Mecklenburg County Greenways from Braemar Housing Limited Partnership (Map
Book 34 Page 312); thence along the north line of area dedicated to Mecklenburg County Greenways
from Braemar Housing Limited Partnership the following three (3) courses: 1) S 39’25’26” W 93.98
feet to a set #4 rebar; 2) S 83°51’31” W 84.36 feet to a set #4 rebar; 3) S 55°59’02” W 88.93 feet
to a found #4 rebar along the east line of Towne Meadows at Treyburn — Phase 2 (Map Book 29 Page
123); thence with the east line of Towne Meadows at Treyburn — Phase 2 the following five (5)
courses: 1) N 20°06’40” W 33.87 feet to a found #5 rebar; 2) N 28°34’49” W 62.39 feet to a found #4
rebar; 3) N 77’53’39” W, passing a found #4 rebar at 107.42 feet, a total distance of 128.43 feet
to a found #4 rebar; 4) N 2X028’1 1” W 172.88 feet to a found #4 rebar; 5) N 48°44’20”
W, passing a found #4 rebar at 155.83 feet, a total distance of 241.22 feet to a found #4 rebar
along the southeastem right-of-way line Treyburn Drive (Map Book 26 Page 680), a public
right-of-way (width varies); thence with the southeastern right-of-way line of Treyburn Drive the
following eight (8) courses: 1) N 35o23’59” E 398.48 feet to a set #4 rebar; 2) with the
arc of a circular curve to the right having a radius of 570.00 feet, an arc length of 339.85 feet
and a chord bearing and distance of N 52o29’36” E 334.84 feet to a set #4 rebar; 3) with
the arc of a circular curve to the right having a radius of 562.50 feet, an arc length of 50.60
feet and a chord bearing and distance of N 75°18’27” E 50.59 feet to a set #4 rebar; 4) N 77°53’05”
E 61.18 feet to a set #4 rebar; 5) with the arc of a circular curve to the left having a radius of
1010.00 feet, an arc length of 51.03 feet and a chord bearing and distance of N 76°09’03” E 51.02
feet to a set masonry nail in sidewalk; 6) N 74°42’12” E 48.10 feet to a set #4 rebar; 7) with the
arc of a circular curve to the left having a radius of 737.50 feet, an arc length of 219.55 feet
and a chord bearing and distance of N 66°10’30” E 218.74 feet to a set #4 rebar; 8) with the arc of
a circular curve to the right having a radius of 35.00 feet, an arc length of 54.85 feet and a
chord bearing and distance of S 77o27’32” E 49.41 feet to a set #4 rebar along the
southern right of way line of the aforesaid Vance Road; thence with the southern right of way of
Vance Road along the arc of a circular curve to the left having a radius of 666.62 feet, an arc
length of 18.55 feet and a chord bearing and distance of S 33°21’40” E 18.55 feet to the Point of
Beginning, containing 10.922 acres and being the same property conveyed to Braemar Housing Limited
Partnership in Deed Book 10139 Page 209 and recorded in Mecklenburg County Register of Deeds.

4EX-10.6

Prepared by, and after recording return

to:

J. Lindsay Stradley, Jr.

Epstein Becker & Green, P.C.

945 E. Paces Ferry Road, Suite 2700

Atlanta, Georgia 30326

SPACE ABOVE THIS LINE FOR RECORDER 5 USE

Absolute Assignment of Leases and Rents

This Absolute Assignment of Leases and Rents (this “Assignment”) is made as of this 25th
day of

May, 2005, by BRAEMAR HOUSING LIMITED PARTNERSHIP, an Ohio limited partnership

(the “Borrower”), whose address is 3103 Carnden Drive, Troy, Michigan 48084, in favor of

TRANSAMERICA OCCIDENTAL LIFE INSURANCE COMPANY, an Iowa corporation (the

“Lender”), whose address is c/o AEGON USA Realty Advisors, Inc., 4333 Edgewood Road, N.E., Cedar
Rapids, Linn County, Iowa 52499-5443. The definitions of capitalized terms used in this Assignment
and not defined above or in the recitals of Section 1 may be found in Section 2 below.

	1.	 	RECITALS

	 	A.	 	The Lender has advanced funds (the “Loan”) to the Borrower, evidenced by
the Secured Promissory Note of the Borrower, dated as of even date herewith and
payable to the order of the Lender, in the principal amount of $10,000,000 (together
with any extensions, renewals, amendments, or modifications, the “Note”), secured in
part by that certain Deed of Trust, Security Agreement and Fixture Filing, dated of
even date herewith and filed for record in the official records of Mecklenhurg
County, North Carolina (together with any extensions, supplements, modifications,
amendments, and consolidations thereof, collectively referred to herein as the “Deed
of Trust”), and encumbering that certain land situated in Mecklenburg County, North
Carolina, described on Exhibit A attached hereto and incorporated herein (the “Land”)
and the Improvements (as defined below) located on the Land. The Land and the
Improvements, collectively, are the “Real Property.”

	 	B.	 	The Lender has required the Borrower, as a condition to the Lender making
the Loan, to make the assignments and grant the rights set forth in this Assignment.
Absolute Assignment of Leases and Rents.

	 	C.	 	The Lender desires to grant the Borrower a conditional license to collect
and use the income derived from the Real Property and to take certain leasing actions
in the ordinary course of business.

	2.	 	DEFINITIONS

"Borrower Affiliate” means an entity that is controlled by, or is under common
control with, the Borrower.

“Business Day” means any day when state and federal banks are open for business in
Cedar Rapids, Iowa.

“Default” shall have the definition set forth in the Deed of Trust.

“Fixtures” shall have the definition set forth in the Deed of Trust.

“Improvements” shall have the definition set forth in the Deed of Trust.

“Leases” means all of the Borrower’s right, title and interest, now or in the
future, under leases or other agreements, written or oral, conferring any tenancy or right
to occupy, possess or use any portion of the Real Property (together with all extensions,
renewals and modifications of Leases), all guaranties of or letters of credit securing the
tenants’ performance of obligations under Leases, the Borrower’s interest in any further
leases, subleases, lettings or agreements (including subleases and tenancies following
attomnent) upon or covering use or occupancy of all or any part of the Real Property, and
all other agreements conferring any right to collect Rents, including the Borrower’s
rights to cancel, modify, terminate, or accept the surrender of the Leases, to remove and
evict the tenants under any Lease, or to increase or reduce Rents.

“Leasing Actions” means all executions, modifications, terminations, and
extensions of Leases, all grants of purchase options or rights of first refusal, and all
other actions taken by the Borrower in exercising its rights as landlord under the Leases.

“Loan Documents” means all documents entered into in connection with the making
and acceptance of the Loan, with the exception of the Environmental Indemnity Agreement
(the “Environmental Indemnity Agreement”) entered into as of even date herewith in
support of the Loan.

“New Owner” means (a) the purchaser at a trustee’s sale of the Real Property,
whether the purchaser is the Lender or a third party, or (b) the grantee of a deed given
in lieu of foreclosure.

“Notice” means a notice delivered in accordance with Section 17.

“Obligations” means all of the obligations required to be performed under the
terms and conditions of any of the Loan Documents by the Borrower or by any other person,
except for obligations that are expressly stated to be unsecured under the terms of
another Loan Document.

“Rents” means all rents, income, receipts, royalties, issues and profits and other
benefits paid or payable for using, leasing, licensing, possessing, operating from or in,
residing in, selling, mining, extracting minerals from, or otherwise enjoying the Real
Property, whether presently existing or arising in the future, to which the Borrower may
now or hereafter become entitled or may demand or claim, including security deposits,
amounts drawn under letters of credit securing tenant obligations, minimum rents, common
area maintenance charges, additional rents, parking revenues, deficiency rents,
termination payments, space contraction payments, damages following default under a Lease,
premiums payable by tenants upon their exercise of cancellation privileges, proceeds from
lease guarantees, proceeds payable under any policy of insurance covering loss of rents
resulting from untenantability caused by destruction or damage to the Real Property, all
rights and claims of any kind which the Borrower has or may in the future have against the
tenants under the Leases, lease guarantors, or any subtenants and other occupants of the
Real Property; all proceeds of any sale of the Real Property in violation of the Loan
Documents, any W r e award granted the Borrower in any court proceeding involving any
tenant in any bankruptcy, insolvency, or reorganization proceedings in any state or
federal court; and any and all payments made by any tenant in lieu of rent.

	3.	 	ASSIGNMENT

For value received, and as an inducement to the Lender to advance the proceeds of the Loan
to or for the benefit of the Borrower, the Borrower does hereby agree as set forth below
and grant, bargain, sell, transfer, set over, deliver, and absolutely, unconditionally and
irrevocably assign unto the Lender the Lewes and the Rents, to have and to hold the same
unto the Lender and unto its successors and assigns, forever, subject to the terms of
Sections 4,5 and 26 below.

This Assignment is made in support of the Loan and in support of the payment, observance,
performance and discharge of all obligations, conditions, covenants, and warranties
contained in the Deed of Trust and the other Loan Documents. This Assignment is and shall
be primary and on parity with the lien on the real estate conveyed by the Deed of Trust.

The Lender and the Borrower intend for this Assignment to be a present and absolute
assignment of the Leases and the Rents. However, if future legislation shall provide, or a
court of competent jurisdiction shall decree, that an assignment of leases and rents made
in support of a commercial mortgage loan such as the Loan may not be absolute, then this
Assignment shall be deemed amended retroactively to the minimum extent necessary to
achieve compliance with applicable legal requirements.

	4.	 	LICENSE TO COLLECT AND USE THE RENTS

The Lender grants to the Borrower a conditional license, subject to the Lender’s rights
under Section 10 below, to collect the Rents, other than those Rents paid more than one
month in advance. The Borrower may use the Rents so collected for any lawful purpose which
is consistent with the Borrower’s ongoing performance of its obligations under the Loan
Documents, provided (a) no Default then exists and (b) the Borrower does not intend to
cause, and has no reason to expect the occurrence of, any Default in respect of the
Obligations due to be performed in the following calendar month.

Any Rents excluded from the scope of this license shall be trust funds for the benefit of
the Lender. The Lender may require that such Rents be deposited in a reserve fund to serve
as additional security for the Loan, or to be used to benefit the Real Property, under
such terms and conditions as the Lender may determine in the exercise of its sole and
absolute discretion.

	5.	 	LICENSE TO TAKE CERTAIN LEASING ACTIONS

5.1 GRANT OF LICENSE

The Lender grants to the Borrower a conditional license, subject to the Lender’s
rights under this Assignment, to take all Leasing Actions, including the
modification or termination of Leases of apartment units in the ordinary course
of business, provided such Leasing Actions are not excluded from the swpe of the
Borrower’s license under Subsection 5.2 and are taken in strict compliance with
the requirements of this Section.

5.2 EXCLUDED LEASING ACTIONS

The license granted by the Lender under this Section does not extend to
the acceptance of any Rent delivered more than one month in advance of the
related period (other than a security deposit), to the grant of any option
to purchase any part of the Real Property or of first refusal, or to any
Leasing Action that results in a Lease:

	 	(i)	 	that is not a Lease of an apartment unit in
the ordinary course of business;

	 	(ii)	 	at less than reasonable market rent during
its original term or any extension period;

	 	(iii)	 	granting the tenant ownership rights in
any Fixtures;

	 	(iv)	 	providing for the payment of rent more than
one month in advance; or

	 	(v)	 	that entails alterations to the structural
elements of any Improvement or would materially involve the principal
mechanical, electrical, or other building systems of any Improvement.

5.2 STANDARD PROVISIONS IN FUTURE LEASES

All new Leases entered into by the Borrower pursuant to the license granted in
this Section shall be in a form of lease previously approved in writing by the
Lender, without material modification thereof, or shall contain provisions that:

	 	(a)	 	obligate the tenant, in the event of foreclosure, to
attorn to the New Owner as successor landlord under the related Lease;

	 	(b)	 	grant the Lender the right to subordinate the lien of the
Deed of Trust to the Lease by filing a notice of subordination with the
Register of Deeds of Mecklenburg County, North Carolina, at any time before
the Lender conducts a foreclosure sale pursuant to the Deed of Trust;

	 	(c)	 	obligate the tenant under a Lease to which the lien of
the Deed of Trust has been so subordinated to attorn to a New Owner;

	 	(d)	 	relieve the New Owner from responsibility for accrued
liabilities of the landlord under the terms of a Lease;

	 	(e)	 	relieve the New Owner from the obligation to cure
existing defaults, other than defaults of a continuing nature of which the
Lender has received Notice, and in respect of which tenant has afforded the
Lender a reasonable cure period following such Notice;

	 	(f)	 	relieve the New Owner from the obligation to return any
security deposit not actually received by the Lender or the other New Owner;

	 	(g)	 	provide that the New Owner shall not be bound by Rents
paid more than one month in advance, or by Leasing Actions taken by the
landlord, unless such Rents have been paid, or such Leasing Actions have
been taken, in compliance with the terms of this Assignment;

	 	(h)	 	provide that the tenant shall provide the Lender with
Notice of landlord default and a reasonable opportunity to cure the default
before exercising any right to terminate the Lease;

	 	(i)	 	provide that the tenant is obligated to repair any
damages incidental to the removal of trade fixtures, office furniture or
office equipment owned by the tenant; and

	 	(j)	 	provide that the tenant shall be authorized to pay Rent
to the Lender upon notice from the Lender that the Borrower’s license to
collect the Rents has been revoked.

	6.	 	LENDER’S APPROVAL OF LEASING ACTIONS

Leasing Actions that the Borrower is not expressly licensed to take under Section 5
require the Lender’s advance written approval. The Borrower shall request such approval in
writing, presenting the terms of the proposed Leasing Action in summary form. The request
shall be accompanied by (i) a copy of the form of lease, lease amendment, or other written
instrument that is to effect the proposed Leasing Action, and (ii) any financial materials
(such as credit reports, tenant financial statements, or retail tenant sales information)
used by the Borrower in arriving at its decision to take the proposed Leasing Action. The
Lender may within ten (10) Business Days of its receipt of the Borrower’s request, and in
the exercise of its reasonable discretion, request any additional documentation required
to permit its analysis of the proposed Leasing Action. Unless the Lender declines a
request for its approval of a Leasing Action by Notice within ten (10) Business Days of
its receipt, together with all documentation required under this Section, the Lender shall
be deemed to have approved the request.

	7.	 	BORROWER’S REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants as follows:

7.1 THE BORROWER’S EXCLUSIVE RIGHT TO ASSIGN

The Borrower is the owner in fee simple absolute of the Real Property, has good
title to the Leases and Rents and has good right to assign them to Lender. No
other natural or legal person has any right, title or interest to the Borrower’s
interest in the Leases and Rents.

7.2 NO LANDLORD DEFAULTS

The Borrower has duly and punctually performed all of the landlord’s obligations,
covenants, conditions and warranties under the terms of the Leases.

7.3 NO TENANT DEFAULTS

To the Borrower’s best knowledge as a duly diligent property owner, no tenant
under a Lease is in material default in the performance of its terms, except as
disclosed in the rent roll delivered to the Lender in connection with the Loan,
an aged receivables delinquency report delivered by the Borrower to the Lender in
connection with the Loan, or an exhibit to the Closing Certificate of Borrower of
even date herewith from the Borrower to the Lender.

7.4 NO PREVIOUS ASSIGNMENT IN FORCE

The Borrower has not previously sold, assigned, transferred, mortgaged, or
pledged the Leases or the Rents except under documents that have been discharged
and released in MI.

7.5 STATUS OF LEASES

To the best of the Borrower’s knowledge, the Leases delivered to the Lender in
connection with the closing of the Loan are valid, unmodified (except pursuant to
modifications that have been delivered to the Lender) and are in full force and
effect.

7.6 STATUS OF FUTURE RENTS

No Rent that will accrue under a Lease has been waived, released, discounted, set
off or otherwise discharged or compromised except rental concessions granted in
the ordinary course of the business of operating a first-class apartment project.

7.7 NO RENT RECEIVED IN ADVANCE

The Borrower has not received any h d s or deposits from the tenant under any
Lease in excess of one (1) month’s Rent, other than security deposits or advance
rents in respect of periods of the rental term that have elapsed.

	8.	 	BORROWER’S COVENANTS

8.1 PERFORMANCE OF OBLIGATIONS

The Borrower shall observe, perform and discharge, duly and punctually, the
Borrower’s obligations, covenants, conditions and warranties under the terms of
the Note, the Deed of Trust, this Assignment, the other Loan Documents, and the
Leases.

8.2 TENANT PERFORMANCE

The Borrower shall use commercially reasonable efforts to cause the tenants under
the Leases to perform their obligations under the Leases.

8.3 LEASING ACTIONS

The Borrower shall take no Leasing Action without the Lender’s advance written
approval, except as expressly permitted under the license granted to the Borrower
under Section 5 of this Assignment.

8.4 ACTIONS AND PROCEEDINGS

The Borrower shall appear in and defend any action or proceeding arising under,
or connected with the Leases or the obligations, duties or liabilities of the
Borrower and the tenants under the Leases.

8.5 FURTHER ASSURANCES

The Borrower shall execute and deliver to the Lender from time to time such
further assignments and instruments as the Lender reasonably may request in order
to effectuate the intent of this Assignment.

8.6 NOTICES OF LANDLORD DEFAULT

If within any thirty (30)-day period the Borrower receives three written notices
from any tenants asserting a material default by the landlord under a Lease, or
advising the Borrower that a condition exists which may become a material default
with the passage of time, the Borrower shall send a copy or memorandum of each
such notice to the Lender.

8.7 RENTROLLS

If a Default has occurred, the Borrower shall, within ten (10) days after receipt
of the Lender’s written request, furnish to the Lender a certificate of the
Borrower setting forth the names of all tenants under the Leases, the terms of
their respective Leases, the space occupied, the rents payable under the Leases,
any security deposits paid, the dates through which any and all rents have been
paid and any other information reasonably requested by the Lender.

8.8 NOTICE TO TENANTS

The Borrower agrees upon written request of the Lender following a Default, to
notify the tenants under the Leases of this Assignment, to direct them in writing
to send the Lender, simultaneously, copies of all notices of default that they
serve on the Borrower, and to direct them, at the Lender’s request, to pay all
future Rent directly to the Lender. The Rents and copies of such notices shall be
sent to the Lender at such address as is specified by the Lender to tenants from
time to time.

8.9 FUTURE ASSIGNMENTS

The Borrower shall not create or permit any lien, charge, or encumbrance of the
Leases or of the Rents, and shall not pledge, transfer, or otherwise assign the
Leases or the Rents unless at the Lender’s request, or unless otherwise agreed to
by the Lender in writing.

8.10 CONSENT TO ASSIGNMENT OF TENANTS’ INTERESTS

The Borrower shall consent to neither an assignment of the tenant’s interest in
any Lease nor to any tenant’s subletting all or any portion of the Real Property
leased by it except to the extent such consent expressly may be required by the
terms and conditions of Leases.

8.11 GENERAL SERVICE ADMINISTRATION LEASES

If at any time the Borrower shall execute any Lease with the General Services
Administration or any other federal agency, the Borrower shall immediately (i)
cause all of the conditions and provisions of the federal Assignment of Claims
Act and the Assignment of Contracts Act to be complied with in full as additional
security for the Obligations, and (ii) provide the Lender with the name, address
and telephone number of the contracting officer and of the disbursement officer
associated with such Lease.

	9.	 	NOTICE TO FUTURE TENANTS CONCERNING ATTORNMENT

By occupying any part of the Real Property under a Lease, each future tenant, at the
option of the Lender or another New Owner, shall be deemed to have agreed to attorn to the
New Owner as successor landlord, subject to the Lender’s or New Owner’s agreement not to
disturb such tenant under its Lease so long as tenant is not in default thereunder. The
recording of this Assignment is intended to impart notice to all future tenants of the
foregoing provision of this Assignment. If the new Lease has been entered into in
accordance with the terms of the license granted to the Borrower in this Assignment, the
New Owner shall accept the tenant’s attornment and shall recognize the Lease as a direct
lease between the New Owner and the tenant.

	10.	 	LENDER’S RIGHTS WON DEFAULT

10.1 REVOCATION OF LICENSES

Upon Default, the Lender may by Notice to the Borrower immediately terminate the
Borrower’s licenses under either or both of Sections 4 and 5 of this Assignment,
regardless of whether the Real Property or any other collateral adequately
secures the Loan’s eventual repayment. Upon the termination of the Borrower’s
license under Section 4, the Borrower shall immediately deliver to the Lender all
Rents then in the Borrower’s possession, and all Rents then due or accruing
thereafter shall be payable by tenants directly to the Lender. This Assignment
shall constitute a direction to and full authority to any tenant of the Real
Property, upon the Lender’s written request to pay all Rents to the Lender,
without requiring the Lender to prove to the tenant the existence of Default. The
Borrower agrees to deliver immediately to the Lender any Rents received by the
Borrower after the revocation of the Borrower’s license under Section 4, and at
the Lender’s written request, shall execute such further assignments to the
Lender of any Lease as the Lender may in its sole judgment request. This
Assignment is given in connection with the Loan and in support of the performance
of the Borrower’s Obligations, and nothmg herein contained shall be construed as
(a) constituting the Lender a “mortgagee-in-possession” of the Real Property or
(b) an assumption by the Lender of the Borrower’s obligations as landlord under
the Leases.

10.2 APPLICATION OF RENTS

The Lender shall apply Rents it collects as follows: (i) first, to the payment of
late and other charges, if any, due and payable under the Loan Documents; (ii)
second, to the repayment of any sums advanced by the Lender for the payment of
any insurance premiums, taxes, assessments or other impositions or charges
against the Real Property; (iii) third, to the payment of any other sums due from
the Borrower to the Lender pursuant to the Loan Documents (other than the amounts
described in clauses (v) and (vi) below); (iv) fourth, to the payment of any
obligations of the Borrower under the Environmental Indemnity Agreement; fifth,
to the payment of interest and principal then due under the Note; (vi) sixth, to
the establishment and maintenance of an impound account for the payment of
impositions on the Real Property in accordance with the Loan Documents; (vii)
seventh, to the payment to unaffiliated third parties of ordinary expenses
incurred in connection with operation of the Real Property, including reasonable
and customary third-party management fees not exceeding four percent (4%) of
effective gross income; (viii) eighth, to establish a fund to be held by the
Lender in its general account, without interest, as additional security for the
Loan pending the cure of all Defaults, and to be disbursed by the Lender in its
reasonable discretion to permit such Defaults to be cured; and (ix) ninth, after
the cure of all Defaults and only thereafter, the balance of the Rents shall be
distributed to the Borrower or to the order of the Borrower.

10.3 NO ACCORD AND SATISFACTION OR WAIVER

The Borrower agrees that the Lender’s exercise of its rights under this Section
shall give rise to neither (a) an accord and satisfaction with respect to any
obligation not fully performed by the Borrower or completely satisfied through
the application of Rents by the Lender, nor (b) a waiver of any rights or
remedies of the Lender.

10.4 DEFAULT INTEREST

Default under this Assignment is a “Default” under the terns of the Deed of
Trust. The Lender is therefore entitled, at its sole discretion, to elect for
interest on the Loan to accrue at the Default Rate specified in the Note until
the Default is cured.

10.5 REINSTATEMENT OF THE BORROWER’S LICENSES

Upon the cure of all Defaults, the Lender may by Notice to the Borrower,
reinstate the licenses of the borrower under Sections 4 and 5.1 of this
Assignment.

10.6 ADDITIONAL NORTH CAROLINA REMEDIES

The Borrower expressly agrees that the Lender shall have, in addition to all
other rights and remedies set forth elsewhere in this Assignment, all the rights
regarding enforcement of assignments of rents and leases, or otherwise available
under North Carolina law.

	11.	 	POWER OF ATTORNEY

The Borrower appoints the Lender as its attorney-in-fact, coupled with an interest, with
full power of substitution, in the name, place, and stead of the Borrower to do, while a
Default exists, all things and to perform all acts with respect to the Leases and the Real
Property authorized by the terms of this assignment, as the Lender may determine from time
to time in its discretion.

	12.	 	WAIVER OF CLAIMS

The Borrower waives any right, claim, or demand it may now or hereafter have against any
tenant by reason of payment of Rents to the Lender at the Lender’s request following a
Default.

	13.	 	LENDER NOT MORTGAGEE-IN-POSSESSION

Acceptance by the Lender of this Assignment shall not, prior to entry upon and taking of
possession of the Real Property by the Lender, be deemed or construed to constitute the
Lender a mortgagee in possession of the Real Property, nor shall the Lender be deemed to
have assumed, by accepting this Assignment, the landlord’s obligations to any tenant. In
particular, acceptance by Lender of this Assignment shall not obligate the Lender (a) to
appear in or to defend any action or proceeding relating to the Leases or to the Real
Property, (b) to perform any obligation as landlord under the Leases, (c) to pay any
amount or to assume any future financial obligation of the landlord, including any
obligation to pay to any tenant a security or other deposit not actually received by the
Lender or (d) to indemnify any tenant for any injury or damage to person or property
sustained by any person or persons, firm or corporation in or about the Real Property.

	14.	 	CUMULATIVE REMEDIES

The Lender may take or release other security, may release any party primarily or
secondarily liable for any Obligation, may grant extensions, renewals or indulgences with
respect to such indebtedness, and may apply any other security therefore held by it to the
satisfaction of such indebtedness without prejudice to any of its rights hereunder.
Nothing herein contained and no act or omission by the Lender pursuant to the powers and
rights granted it herein shall he deemed to be a waiver by the Lender of its rights and
remedies under any of the Loan Documents, or shall prejudice any of the rights and
remedies possessed by the Lender under their terms. The right of the Lender to collect the
Loan or additional Obligations may be exercised by the Lender prior to, simultaneously
with, or subsequently to any action taken by the Lender under this Assignment.

	15.	 	EXPENSES

Any expenses incurred by the Lender in exercising its remedies under this Assignment after
the occurrence of a Default (including attorneys’ fees and costs in enforcing or
protecting this Assignment in any bankruptcy proceeding) shall constitute further
indebtedness of the Borrower to the Lender and shall be immediately payable to the Lender,
together with interest at the Default Rate specified in the Note.

	16.	 	INDEMNIFICATION

The Borrower hereby agrees to indemnify, defend, and hold the Lender harmless from and
against any and all liability, loss, damage or expense (unless such liability, loss,
damage or expenses arises through the Lender’s gross negligence or willful misconduct)
which the Lender may or might incur under or by reason of this Assignment, or for any
lawful action taken by the Lender hereunder, or by reason or in defense of any and all
claims and demands whatsoever which may be asserted against the Lender arising out of the
Leases, including, without limitation, any claim by any tenant of credit for Rent paid to
and received by the Borrower, but not delivered to the Lender, for any period under any
Leases more than one month in advance of the due date thereof; and should the Lender incur
any such liability, loss, damage or expense, the amount thereof (including reasonable
attorneys’ fees) with interest thereon at the rate specified as the Default Rate in the
Note shall be payable by the Borrower immediately without demand, and shall be secured
hereby and by the Deed of Trust.

	17.	 	NOTICE

In order for any demand, consent, approval or other communication to be effective under
the terms of this Assignment, “Notice” must be provided under the terms of this Section.
All Notices must be in writing. Notices may be (a) delivered by band, (h) transmitted by
facsimile (with a duplicate copy sent by first class mail, postage prepaid), (c) sent by
certified or registered mail, postage prepaid, return receipt requested, or (d) sent by
reputable overnight courier service, delivery charges prepaid. Notices shall be addressed
as set forth below:

If to the Lender:

Transamerica Occidental Life Insurance Company

c/o AEGON USA Realty Advisors, Inc.

4333 Edgewood Road, N.E.

Cedar Rapids, Iowa 52499-5443

Attn: Mortgage Loan Department

Reference: Loan #89441

Fax Number: (319) 369-2277

If to the Borrower:

Braemar Housing Limited Partnership

c/o Levin Development

3103 Camden Drive

Troy, Michigan 48084

Fax Number: (248) 588-4455

with a copy of any Notice of default or acceleration to:

Kenneth F. Silver

Hertz, Schram & Saretsky, P.C.

1760 South Telegraph Road, Suite 300

Bloomfield Hills, Michigan 48302

Fax Number: (248) 335-3346

Notices delivered by hand or by overnight courier shall be deemed given when actually
received or when refused by their intended recipient. Notices sent by facsimile will be
deemed delivered when a legible copy has been received (provided receipt has been verified
by telephone confirmation or one of the other permitted means of giving Notices under this
Section). Mailed Notices shall be deemed given on the date of the first attempted delivery
(whether or not actually received). Either the Lender or the Borrower may change its
address for Notice by giving at least fifteen (15) Business Days’ prior Notice of such
change to the other party.

	18.	 	SUCCESSORS AND ASSIGNS

The terms, covenants, conditions and warranties contained herein and the powers granted
hereby shall run with the land, shall inure to the benefit of and bind the parties hereto
and their respective heirs, executors, administrators, successors and assigns, and all
tenants, sub-tenants and assigns of same, and all occupants and subsequent owners of the
Real Property.

	19.	 	CHOICE OF LAW

This Assignment shall be construed and enforced according to, and governed by, the laws of
North Carolina without reference to conflicts of laws provisions which, but for this
provision, would require the application of the law of any other jurisdiction.

	20.	 	TIME OF ESSENCE

Time shall be of the essence in the Borrower’s performance of its obligations under this
Assignment.

	21.	 	SEVERABILITY

In the event that any one or more of the provisions of this Assignment shall for any
reason be held to be invalid, illegal or unenforceable, in whole or in part, or in any
respect, or in the event that any one or more of the provisions of this Assignment shall
operate, or would prospectively operate, to invalidate this Assignment, then, and in any
such event, such provision or provisions only shall be deemed to be null and void and of
no force or effect, and shall not affect any other provision of this Assignment which
other provisions shall remain operative and in full force and effect and shall in no way
be affected, prejudiced or disturbed thereby.

	22.	 	AMENDMENT

This Assignment may be amended, revised, waived, discharged, released or terminated only
by a written instrument or instruments executed by the party against which enforcement of
the amendment, revision, waiver, discharge, release or termination is asserted. Any
alleged amendment, revision, waiver, discharge, release or termination that is not so
documented shall be null and void.

	23.	 	VARIATION IN PRONOUNS

All the terms and words used in this Assignment, regardless of the number and gender in
which they are used, shall be deemed and construed to include any other number, singular
or plural, and any other gender, masculine, feminine, or neuter, as the context or sense
of this Assignment or any paragraph or clause herein may require, the same as if such word
had been fully and properly written in the correct number and gender.

	24.	 	CAPTIONS

The section titles or captions contained in this Assignment are for convenience only and
shall not be deemed to define, S i t or otherwise modify the scope or intent of this
Assignment.

	25.	 	COUNTERPARTS

This Assignment may be executed in one or more counterparts, each of which shall be deemed
an original but all of which taken together shall constitute one and the same agreement.

	26.	 	TERMINATION

Upon discharge of record of the Deed of Trust and payment in full of all monetary
obligations under the Note, this Assignment shall terminate without the need for any
separate instrument of discharge; provided that if the Borrower requests a termination in
recordable form, the Lender shall provide one, at the Borrower’s expense.

IN WITNESS WHEREOF, the Borrower has caused this Absolute Assignment of Leases and Rents to be duly
executed under seal as of the date first above written.

BRAEMAR HOUSING LIMITED PARTNERSHIP, an Ohio
limited partnership

[SEAL]

	 	 	 	By:
Treyburn Housing, LLC, an Ohio limited
liability company, its sole General Partner

[SEAL]

	 	 	 	By:
LPS Investments, L.L.C., a Michigan
limited liability company, its sole
Managing Member
[SEAL]

	 	 	 	By:
Phillip I. Levin
[SEAL]

Phillip I. Levin, Manager

1

STATE OF MICHIGAN

COUNTY OF OAKLAND

I, Shelly M. Rayment a Notary Public of the County and State aforesaid, do hereby certify
that Phillip I. Levin personally came before me this day and after being duly sworn, said that he
is the Manager of LPS Investments, L.L.C., a Michigan limited liability company, which is the sole
Managing Member of Treyburn Housing, LLC, an Ohio limited partnership, which is the sole General
Partner of Braemar Housing Limited Partnership, an Ohio limited partnership, and that this
instrument was signed and sealed by him, on behalf of the aforementioned limited liability
companies and limited partnership by their authority duly given, and M e r acknowledged this
instrument to be the act and deed of the aforementioned limited liability companies and limited
partnership.

WITNESS my hand and official stamp or seal, this _25     day of May  ,
2005.

/s/ Shelly M. Rayment

	 	 	Notary Public

Acting in:

My Commission Expires:

     

[NOTARIAL SEAL]

[SHELLY M. RAYMENT

NOTARY PUBLIC STATE OF MICHIGAN

GENESSEE COUNTY

ACTING IN:

OAKLAND COUNTY

MY COMMISSION EXP. JUNE 27, 2005]

2

EXHIBIT A

THE LAND

That certain tract located in Long Creek Township, Mecklenburg County, North Carolina, and being
more particularly described as follows:

Beginning at a found #4 rebar along the southern right-of-way line of Vance Road (SR 21 13), a 60’
public right-of-way, a common comer with Russell Kakaley (Deed Book 4263 Page 175); thence with the
west line of Russell Kakaley the following three (3) courses: 1) S 37°41’42” W 188.44 feet to a
found iron pipe; 2) S 24’01’37” W 445.09 feet to a found 314” square pipe; 3) S
27o46’39” W 11 1.27 feet to a found #4 rebar, a common comer with Russell Kakaley and
Floreine F. Burt Family Limited Partnership (Deed Book 10993 Page 139); thence with the west line
of Floreine F. Burt Family Limited Partnership the following two (2) courses: 1) S 03“3 1’39” E
173.20 feet to a found #4 rebar; 2) S 13°36’32” E 110.76 feet to a set #4 rebar, a common comer
with area dedicated to Mecklenburg County Greenways from Braemar Housing Limited Partnership (Map
Book 34 Page 312); thence along the north line of area dedicated to Mecklenburg County Greenways
from Braemar Housing Limited Partnership the following three (3) courses: 1) S 39’25’26” W 93.98
feet to a set #4 rebar; 2) S 83°51’31” W 84.36 feet to a set #4 rebar; 3) S 55°59’02” W 88.93 feet
to a found #4 rebar along the east line of Towne Meadows at Treyburn — Phase 2 (Map Book 29 Page
123); thence with the east line of Towne Meadows at Treyburn — Phase 2 the following five (5)
courses: 1) N 20°06’40” W 33.87 feet to a found #5 rebar; 2) N 28°34’49” W 62.39 feet to a found #4
rebar; 3) N 77’53’39” W, passing a found #4 rebar at 107.42 feet, a total distance of 128.43 feet
to a found #4 rebar; 4) N 2X028’1 1” W 172.88 feet to a found #4 rebar; 5) N 48°44’20”
W, passing a found #4 rebar at 155.83 feet, a total distance of 241.22 feet to a found #4 rebar
along the southeastem right-of-way line Treyburn Drive (Map Book 26 Page 680), a public
right-of-way (width varies); thence with the southeastern right-of-way line of Treyburn Drive the
following eight (8) courses: 1) N 35o23’59” E 398.48 feet to a set #4 rebar; 2) with the
arc of a circular curve to the right having a radius of 570.00 feet, an arc length of 339.85 feet
and a chord bearing and distance of N 52o29’36” E 334.84 feet to a set #4 rebar; 3) with
the arc of a circular curve to the right having a radius of 562.50 feet, an arc length of 50.60
feet and a chord bearing and distance of N 75°18’27” E 50.59 feet to a set #4 rebar; 4) N 77°53’05”
E 61.18 feet to a set #4 rebar; 5) with the arc of a circular curve to the left having a radius of
1010.00 feet, an arc length of 51.03 feet and a chord bearing and distance of N 76°09’03” E 51.02
feet to a set masonry nail in sidewalk; 6) N 74°42’12” E 48.10 feet to a set #4 rebar; 7) with the
arc of a circular curve to the left having a radius of 737.50 feet, an arc length of 219.55 feet
and a chord bearing and distance of N 66°10’30” E 218.74 feet to a set #4 rebar; 8) with the arc of
a circular curve to the right having a radius of 35.00 feet, an arc length of 54.85 feet and a
chord bearing and distance of S 77o27’32” E 49.41 feet to a set #4 rebar along the
southern right of way line of the aforesaid Vance Road; thence with the southern right of way of
Vance Road along the arc of a circular curve to the left having a radius of 666.62 feet, an arc
length of 18.55 feet and a chord bearing and distance of S 33°21’40” E 18.55 feet to the Point of
Beginning, containing 10.922 acres and being the same property conveyed to Braemar Housing Limited
Partnership in Deed Book 10139 Page 209 and recorded in Mecklenburg County Register of Deeds.

3

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