Document:

Exhibit
10.98

 

RECORD AND RETURN TO:

 

Cassin Cassin & Joseph LLP

711 Third Avenue, 20th Floor

New York, New York 10017

Attn:  Carol M.
Joseph, Esq.

 

 

MORTGAGE,
ASSIGNMENT OF RENTS, SECURITY AGREEMENT AND FIXTURE FILING

 

 

 

 

INLAND
AMERICAN MALDEN, L.L.C., a
 Delaware limited liability company, as mortgagor
(Borrower)

 

for the benefit of

 

NOMURA
CREDIT & CAPITAL, INC. ,

as mortgagee, and its successors and assigns (Lender)

 

 

THE COLLATERAL IS
OR INCLUDES FIXTURES

 

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

 

Borrower’s Organizational Number:  4150450

Borrower’s Federal Identification No.:  20-4780172

 

Date:                                                                    As of June 8, 2006

Location:                                              Malden Stop & Shop

99 Charles Street

Malden, Massachusetts

 

County:                                                     Middlesex

 

 

 

 

MORTGAGE,
ASSIGNMENT OF RENTS,

SECURITY AGREEMENT AND FIXTURE
FILING

 

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

 

W I  T  N  E  S  S
E  T  H:

 

WHEREAS, this Mortgage is
given to secure a loan (the “Loan”) in the
principal sum of TWELVE MILLION SEVEN HUNDRED FIFTY-TWO
THOUSAND SEVEN HUNDRED FORTY-TWO AND 00/100 DOLLARS ($12,752,742.00)
advanced pursuant to that certain Loan Agreement dated as of the date hereof
between Borrower and Lender (as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time, the “Loan
Agreement”, and evidenced by that certain
Promissory Note dated the date hereof made by Borrower to Lender (such Note,
together with all extensions, renewals, replacements, restatements or
modifications thereof being hereinafter referred to as the “Note”), which
Note provides, among other things, for final payment of principal and interest
thereunder, if not sooner paid or payable as provided therein, to be due on June 11, 2031;

 

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

 

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

 

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

 

 

ARTICLE 1

GRANTS OF SECURITY

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

4

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

5

 

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

 

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

 

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

 

6

 

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

 

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

 

CONDITIONS
TO GRANT

 

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

 

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

 

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

 

ARTICLE 2

DEBT AND OBLIGATIONS SECURED

 

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

 

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

 

7

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

ARTICLE 3

BORROWER COVENANTS

 

Borrower covenants and agrees that:

 

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

 

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

 

8

 

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

 

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

 

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

 

Section 3.6.            Payment for Labor and Materials.

 

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

 

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

 

9

 

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

 

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

 

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

 

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

 

10

 

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

 

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

 

ARTICLE 4

OBLIGATIONS AND RELIANCES

 

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

 

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

 

Section 4.3.            No Lender
Obligations.

 

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

 

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

 

11

 

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

 

ARTICLE 5

FURTHER ASSURANCES

 

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

 

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

 

12

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

13

 

ARTICLE 6

DUE ON SALE/ENCUMBRANCE

 

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

 

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

 

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

 

14

 

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

 

ARTICLE 7

RIGHTS AND REMEDIES UPON DEFAULT

 

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

 

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

 

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

 

15

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

16

 

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

 

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

 

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

 

(i)            Taxes and Other Charges;

 

(ii)           Insurance Premiums;

 

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

 

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

 

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

 

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

 

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

 

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

 

17

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

18

 

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

 

Section 7.7.            Other Rights, Etc.

 

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

 

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

 

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

 

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

 

19

 

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

 

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

 

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

 

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

 

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

 

20

 

ARTICLE 8

ENVIRONMENTAL HAZARDS

 

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

 

21

 

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

 

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

 

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

 

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

 

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

 

22

 

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

 

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

 

23

 

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

 

ARTICLE 9

INDEMNIFICATIONS

 

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

 

24

 

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

 

25

 

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

 

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

 

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

 

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

 

26

 

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

 

27

 

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

 

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

 

28

 

ARTICLE 10

WAIVERS

 

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

 

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

 

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

 

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

 

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

 

29

 

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

 

ARTICLE 11

EXCULPATION

 

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

 

ARTICLE 12

NOTICES

 

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

 

ARTICLE 13

APPLICABLE LAW

 

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

 

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

 

30

 

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

 

ARTICLE 14

DEFINITIONS

 

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

 

ARTICLE 15

MISCELLANEOUS PROVISIONS

 

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

 

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

 

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

 

31

 

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

 

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

 

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

 

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

 

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

 

ARTICLE 16

INTENTIONALLY OMITTED

 

32

 

ARTICLE 17

SPECIAL MASSACHUSETTS PROVISIONS

 

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

 

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

 

[Signature Page to
Follow]

 

33

 

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

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  INLAND AMERICAN MALDEN, L.L.C.,
  a

  
	
   

  	
  Delaware
  limited liability company

  
	
   

  	
   

  
	
   

  	
  By:

  	
  INLAND AMERICAN CERUZZI MALDEN

  
	
   

  	
   

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

  
	
   

  	
   

  	
  its Sole Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  INLAND AMERICAN MALDEN MEMBER

  
	
   

  	
   

  	
   

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

  
	
   

  	
   

  	
   

  	
  its Manager

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  INLAND AMERICAN REAL ESTATE

  
	
   

  	
   

  	
   

  	
   

  	
  TRUST, INC.,
  a Maryland corporation,

  
	
   

  	
   

  	
   

  	
   

  	
  its Sole Member

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
   

  	
  Title:Exhibit 10.99

 

WHEN RECORDED RETURN TO)

 

Thompson & Knight L.L.P.

1700 Pacific Avenue

Suite 3300

Dallas, Texas 75201

Attention: Jeanne M. Burton

 

MORTGAGE AND SECURITY
AGREEMENT

 

755086

 

A.                       THIS MORTGAGE AND SECURITY AGREEMENT (as the same may from time to
time hereafter be modified, supplemented or amended, this “Mortgage”) is
made as of June 8, 2006, by and between INLAND AMERICAN SICKLERVILLE,
L.L.C., a Delaware limited liability company, having its principal place of
business and post office address at 2901 Butterfield Road, Oak Brook, Illinois
60523 (“Borrower”), as mortgagor, and PRINCIPAL LIFE INSURANCE COMPANY,
an Iowa corporation (“Lender”), as mortgagee.

 

WITNESSETH:

 

B.                       Borrower is justly indebted to Lender for money borrowed (the “Loan”)
in the original principal sum of Eight Million Five Hundred Thirty Five
Thousand and No/100 Dollars ($8,535,000.00) (the “Loan Amount”)
evidenced by Borrower’s secured promissory note of even date herewith, made
payable and delivered to Lender (as may be modified, amended,
supplemented, extended or consolidated in writing and any note(s) issued in
exchange therefor or replacement thereof) (the “Note”), in which Note
Borrower promises to pay to Lender the Loan Amount together with all accrued
and unpaid interest thereon, interest accrued at the Default Rate (if any),
Late Charges (if any), the Make Whole Premium (if any), and all other
obligations and liabilities due or to become due to Lender pursuant to the Loan
Documents and all other amounts, sums and expenses paid by or payable to Lender
pursuant to the Loan Documents and the Environmental Indemnity (collectively
the “Indebtedness”) until the Indebtedness has been paid, but in any
event, the unpaid balance (if any) remaining due on the Note shall be due and
payable on July 1, 2013 (the “Maturity Date”) or such earlier date
resulting from the acceleration of the Indebtedness by Lender. All of the terms
and conditions of the Note are hereby incorporated by reference as though set
forth at length herein. Capitalized terms used herein and not otherwise defined
shall have those meanings given to them in the other Loan Documents.

 

C.                       NOW, THEREFORE, to secure the payment of the Indebtedness in accordance
with the terms and conditions of the Loan Documents, and all extensions,
modifications and renewals thereof and the performance of the covenants and
agreements contained therein, and also to secure the payment of any and all
other Indebtedness, direct or contingent, that may now or hereafter become
owing from Borrower to Lender in connection with the Loan Documents, and in
consideration of the Loan Amount in hand paid, receipt of which is hereby
acknowledged.

 

1

 

Borrower does by these presents mortgage,
give, grant, bargain, and sell, with mortgage covenants, unto Lender, its
successors and assigns forever, that certain real estate and all of Borrower’s
estate, right, title and interest therein, located in the county of Camden,
state of New Jersey designated as Lot No. 4.01, Block 502, on the tax map
of Winslow Township in said county, more particularly described in Exhibit A
attached hereto and made a part hereof (the “Land”), which Land,
together with the following described property, rights and interests, is
collectively referred to herein as the “Premises”.

 

D.                       Together with Borrower’s interest as lessor in and to all Leases and all
Rents which are pledged primarily and on a parity with the Land and not
secondarily.

 

E.                        Together with all and singular the tenements, hereditaments, easements,
appurtenances, passages, waters, water courses, riparian rights, direct flow,
ditch, reservoir, well and other water rights, whether or not adjudicated,
whether tributary or nontributary and whether evidenced by deed, water stock,
permit or otherwise, sewer rights, rights in trade names, licenses, permits and
contracts, and all other rights, liberties and privileges of any kind or
character in any way now or hereafter appertaining to the Land, including but
not limited to, homestead and any other claim at law or in equity as well as
any after-acquired title, franchise or license and the reversion and reversions
and remainder and remainders thereof.

 

F.                         Together with the right in the case of foreclosure hereunder of the
encumbered property for Lender to take and use the name by which the buildings
and all other improvements situated on the Premises are commonly known and the
right to manage and operate the said buildings under any such name and variants
thereof.

 

G.                       Together with all right, title and interest of Borrower in any and all
buildings and improvements of every kind and description now or hereafter
erected or placed on the said Land and all materials intended for construction,
reconstruction, alteration and repairs of such buildings and improvements now
or hereafter erected thereon, all of which materials shall be deemed to be
included within the Premises immediately upon the delivery thereof to the
Premises, and all fixtures now or hereafter owned by Borrower and attached to
or contained in and used in connection with the Premises including, but not
limited to, all machinery, motors, elevators, fittings, radiators, awnings,
shades, screens, and all plumbing, heating, lighting, ventilating,
refrigerating, incinerating, air-conditioning and sprinkler equipment and
fixtures and appurtenances thereto; and all items of furniture, furnishings,
equipment and personal property owned by Borrower used or useful in the
operation of the Premises; and all renewals or replacements of all of the aforesaid
property owned by Borrower or articles in substitution therefor, whether or not
the same are or shall be attached to said buildings or improvements in any
manner (collectively, the “Improvements”); it being mutually agreed,
intended and declared that all the aforesaid property owned by Borrower and
placed by it on the Land or used in connection with the operation or
maintenance of the Premises shall, so far as permitted by law, be deemed to form a
part and parcel of the Land and for the purpose of this Mortgage to be
Land and covered by this Mortgage, and as to any of the property aforesaid
which does not form a part and parcel of the Land or does not
constitute a “fixture” (as such term is defined in the Uniform Commercial
Code (“UCC”)), this Mortgage and the other Loan Documents (the terms of which

 

2

 

grant a security interest in personal property
or real property, the proceeds of which may become personal property) are
each hereby deemed to be, as well, a security agreement under the UCC for the
purpose of creating a security interest in all items, including, but not
limited to all property and rights which Borrower may grant, assign,
bargain, sell, transfer, set over, deliver, or otherwise convey to Lender, as
secured party, under the terms of this Mortgage or any of the other Loan
Documents, including any and all proceeds thereof (as used herein, Borrower
shall mean “Debtor” under the UCC and Lender shall mean “Secured Party” under
the UCC). Borrower hereby appoints Lender as its attorney-in-fact to execute
such documents necessary to perfect Lender’s security interest and authorizes
Lender at any time until the Indebtedness is paid in full, to prepare and file,
at Borrower’s expense, any and all UCC financing statements, amendments,
assignments, terminations and the like, necessary to create and/or maintain a
prior security interest in such property all without Borrower’s execution of
the same. Furthermore, upon a default under the Loan Documents, Lender will, in
addition to all other remedies provided for in the Loan Documents, have the
remedies provided for under the UCC in effect in the State in which the
Premises is located.

 

H.                      Together with all right, title and interest of Borrower, now or hereafter
acquired, in and to any and all strips and gores of land adjacent to and used
in connection with the Premises and all right, title and interest of Borrower,
now owned or hereafter acquired, in, to, over and under the ways, streets,
sidewalks and alleys adjoining the Premises.

 

I.                           Together with all funds now or hereafter held by Lender under any
property reserves agreement (including any proceeds derived from any letter of
credit) or escrow security agreement or under any of the terms hereof or of the
Loan Documents, including but not limited to funds held under the provisions of
the Loan Agreement.

 

J.                           Together with all of Borrower’s payment intangibles, letter of credit
rights, interest rate cap agreements, tenant in common agreement rights, and
any other contract rights of Borrower related in any manner to the ownership,
operation, or management of the Premises, as well as any and all supporting
obligations, and all proceeds, renewals, replacements and substitutions
thereof.

 

K.                      Together with all funds, accounts and proceeds thereof relating to the
Premises whether or not such funds, accounts or proceeds thereof are held by
Lender under the terms of any of the Loan Documents, including, but not limited
to bankruptcy claims of Borrower against any tenant at the Premises, and any
proceeds thereof; proceeds of any Rents, insurance proceeds from all insurance
policies required to be maintained by Borrower under the Loan Documents
(subject to the balance of the terms of this Mortgage) and all awards, decrees,
proceeds, settlements or claims for damage now or hereafter made to or for the
benefit of Borrower by reason of any damage to, destruction of or taking of the
Premises or any part thereof, whether the same shall be made by reason of
the exercise of the right of eminent domain or by condemnation or otherwise (a “Taking”).

 

L.                        TO HAVE AND TO HOLD the same unto the Lender, its successors and assigns
forever, for the purposes and uses herein expressed.

 

3

 

M.                    Borrower
represents that it shall forever warrant and defend the title to the Premises
against all claims and demands of all persons whomsoever and will on demand
execute any additional instrument which may be required to give Lender a
valid first lien on all of the Premises, subject to the “Permitted
Encumbrances” set forth in the loan policy of title insurance for the
Premises issued to Lender.

 

N.                       Borrower
further represents that (i) the Premises is not subject to any casualty
damage; (ii) Borrower has not received any written notice of any eminent
domain or condemnation proceeding affecting the Premises; and (iii) to the
best of Borrower’s knowledge, following due and diligent inquiry, there are no
actions, suits or proceedings pending, completed or threatened against or
affecting Borrower or any person or entity owning an interest (directly or
indirectly) in Borrower (“Interest Owner(s)”) or any property of
Borrower or any Interest Owner in any court or before any arbitrator of any
kind or before or by any governmental authority (whether local, state, federal
or foreign) that, individually or in the aggregate, could reasonably be
expected by Lender to be material to the transaction contemplated hereby.

 

O.                       Borrower
further represents and warrants that as of the date hereof and until the
Indebtedness is paid in full:

 

(a)                   Borrower
and each person or entity owning an interest in Borrower is not (i) identified
on the Specially Designated Nationals and Blocked Persons List maintained by
the Office of Foreign Assets Control, Department of the Treasury (“OFAC”)
and/or on any other similar list maintained by OFAC pursuant to any authorizing
statute, executive order or regulation (collectively, the “List”), (ii) a
person or entity with whom a citizen of the United States is prohibited to
engage in transactions by any trade embargo, economic sanction, or other
prohibition of United States law, regulation, or Executive Order of the
President of the United States;

 

(b)                   none
of the funds or other assets of Borrower constitute property of, or are
beneficially owned, directly or indirectly, by any Embargoed Person (as
hereinafter defined);

 

(c)                    no
Embargoed Person has any interest of any nature whatsoever in Borrower (whether
directly or indirectly);

 

(d)                   none
of the funds of Borrower have been derived from any unlawful activity with the
result that the investment in Borrower is prohibited by law or that the
agreement is in violation of law,

 

(e)                    Borrower
has and will continue to implement procedures, and has consistently and will
continue to consistently apply those procedures, to ensure the foregoing
representations and warranties remain true and correct at all times. The term “Embargoed
Person” means any person, entity or government subject to trade restrictions
under U.S. law, including but not limited to, the International Emergency
Economic Powers Act, 50 U.S.C. §1701 et seq., The Trading with the Enemy
Act,

 

4

 

50 U.S.C. App. 1 et seq., and any Executive
Orders or regulations promulgated thereunder with the result that the
investment in Borrower is prohibited by law or Borrower is in violation of law;

 

(f)                     Borrower
has complied and will continue to comply with all requirements of law relating
to money laundering, anti-terrorism, trade embargos and economic sanctions, now
or hereafter in effect; and

 

(g)                    Borrower
has not and will not use funds from any “Prohibited Person” (as such term is
defined in the September 24, 2001 Executive Order Blocking Property and
Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or
Support Terrorism) to make any payment due to Lender under the Loan Documents

 

Borrower will immediately notify Lender in writing if
any of the representations, warranties or covenants are no longer true or have
been breached or if Borrower has a reasonable basis to believe that they may no
longer be true or have been breached. In addition, Borrower will, at the
request of Lender, provide such information as may be requested by Lender
to determine Borrower’s compliance with the terms hereof.

 

BORROWER COVENANTS AND AGREES AS FOLLOWS:

 

1.                        Borrower
shall

 

(a)                    pay
each item of Indebtedness secured by this Mortgage when due according to the
terms of the Loan Documents;

 

(b)                    pay
a Late Charge on any payment of principal, interest, Make Whole Premium or
Indebtedness which is not paid on or before the due date thereof, which late
charge Borrower acknowledges is not a penalty but rather is a charge that
reasonably estimates the additional expense to be incurred by Lender in
handling such late payment;

 

(c)                     pay
on or before the due date thereof any indebtedness permitted to be incurred by
Borrower pursuant to the Loan Documents and any other claims which could become
a lien on the Premises (unless otherwise specifically addressed in paragraph 1(e)
hereof), and upon request of Lender exhibit satisfactory evidence of the
discharge thereof;

 

(d)                    complete
within a reasonable time, the construction of any Improvements now or at any
time in process of construction upon the Land which are required to be
performed by Borrower;

 

(e)                     manage,
operate and maintain the Premises and keep the Premises, including but not
limited to, the Improvements, in good condition and repair and free from
mechanics’ liens or other liens or claims for liens, provided however, that

 

5

 

Borrower may in good faith, with reasonable
diligence and upon written Notice to Lender within twenty (20) days after
Borrower has knowledge of such lien or claim, contest the validity or amount of
any such lien or claim and defer payment and discharge thereof during the
pendency of such contest in the manner provided by law, provided that (i) such
contest may be made without the payment thereof; (ii) such contest
shall prevent the sale or forfeiture of the Premises or any part thereof,
or any interest therein, to satisfy such lien or claim; (iii) Borrower
shall have obtained a bond over such lien or claim from a bonding company
acceptable to Lender which has the effect of removing such lien or collection
of the claim or lien so contested; and (iv) Borrower shall pay all costs
and expenses incidental to such contest; and further provided, that in the
event of a final, non-appealable ruling or adjudication adverse to Borrower,
and provided the court of jurisdiction has not granted a stay of the
enforcement of the ruling or judgment, Borrower shall promptly pay such claim
or lien, shall indemnify and hold Lender and the Premises harmless from any
loss or damage arising from such contest and shall take whatever action
necessary to prevent sale, forfeiture or any other loss or damage to the
Premises or to the Lender; provided, however, Lender acknowledges and agrees
that performance of the obligations set forth in this Paragraph l(e) by
Major Tenant (as hereinafter defined) with respect to its leased premises shall
be deemed compliance with such provisions by Borrower with respect to such
portion of the Premises; as used herein, the term “Major Tenant” shall
mean the tenant under the Lease Agreement dated December 21, 2001 in favor
of Giant of Maryland, LLC, as amended, or any lease to any replacement tenant
under such lease approved by Lender (a “Replacement Tenant”).

 

(f)                      comply,
and cause each lessee or other user of the Premises to comply, with all
requirements of law and ordinance, and all rules and regulations, now or
hereafter enacted, by authorities having jurisdiction of the Premises and the
use thereof, including but not limited to all covenants, conditions and
restrictions of record pertaining to the Premises, the Improvements, and the
use thereof (collectively, “Legal Requirements”); provided, however,
Lender acknowledges and agrees that performance of the obligations set forth in
this Paragraph l(f) by Major Tenant with respect to its leased premises shall
be deemed compliance with such provisions by Borrower with respect to such
portion of the Premises;

 

(g)                     subject
to the provisions of paragraph 6 hereof, promptly repair, restore or rebuild
any Improvements, now or hereafter a part of the Premises which may become
damaged or be destroyed by any cause whatsoever, so that upon completion of the
repair, restoration and rebuilding of such Improvements there will be no liens
of any nature arising out of the construction and the Premises will be of
substantially the same character and quality as it was prior to the damage or
destruction; provided, however, Lender acknowledges and agrees that performance
of the obligations set forth in this Paragraph l(g) by Major

 

6

 

Tenant with respect to its leased premises shall be
deemed compliance with such provisions by Borrower with respect to such portion
of the Premises;

 

(h)                    if
other than a natural person, do all things necessary to preserve and keep in
full force and effect its existence, franchises, rights and privileges under
the laws of the state of its formation and, if other than its state of
formation, the State where the Premises is located. Borrower shall notify
Lender at least thirty (30) days prior to (i) any relocation of Borrower’s
principal place of business to a different state or any change in Borrower’s
state of formation, and/or (ii) if Borrower is an individual, any
relocation of Borrower’s principal residence to a different state;

 

(i)                        do
all things necessary to preserve and keep in full force and effect Lender’s
title insurance coverage insuring the lien of this Mortgage as a first and
prior lien, subject only to the Permitted Encumbrances stated in the title
insurance policy issued to Lender and any other exceptions after the date of
this Mortgage approved in writing by Lender, including without limitation,
delivering to Lender not less than 30 days prior to the effective date of any
rate adjustment, modification or extension of the Note or any other Loan
Document, any new policy or endorsement which may be reasonably required
to assure Lender of such continuing coverage;

 

(j)                       execute
any and all documents which may be required to perfect the security
interest granted by this Mortgage; and

 

(k)                    remain
a Single-Purpose Entity.

 

2.                        Borrower
shall not:

 

(a)                    construct
any building or structure nor make any alteration or addition (other than
normal repair and maintenance) to (i) the roof or any structural component
of any Improvements on the Premises, or (ii) the building operating
systems, including but not limited to, the mechanical, electrical, heating,
cooling, or ventilation systems (other than replacement with equal or better
quality and capacity).

 

Notwithstanding anything hereinabove to the contrary,
the restrictions set forth in this Paragraph 2(a) shall not be applicable
if such activity is (i) required by applicable Legal Requirements; or (ii) specifically
provided for in a Lease approved by Lender prior to closing of the Loan or
thereafter, in which a tenant has the right to complete any of the above
without Borrower’s prior consent in its capacity as landlord under such Lease.
With respect to any Lease in which the above activities require Borrower’s
prior consent (in its capacity as landlord under such Lease), Borrower shall
also obtain Lender’s prior written consent, not to be unreasonably withheld;

 

7

 

(b)                    remove
or demolish any material Improvements, or any portion thereof, which at any
time constitutes a part of the Premises.

 

Notwithstanding anything hereinabove to the contrary,
Borrower may construct, remove or demolish tenant improvements within the
then existing building(s) or other structures to the extent such work is
required solely under the terms of any Leases approved by Lender provided (i) no
Event of Default exists under the Loan Documents; (ii) the work is
completed on a timely basis, in a good, workmanlike, lien-free manner and in
accordance with all Legal Requirements, and (iii) such work does not
negatively affect the structural integrity of the Improvements or the value of
the Premises;

 

(c)                     cause
or permit any change to be made in the general use of the Premises without
Lender’s prior written consent;

 

(d)                    initiate
any or acquiesce to a zoning reclassification or material change in zoning
without Lender’s prior written consent. Borrower shall use all reasonable
efforts to contest any such zoning reclassification or change;

 

(e)                     make
or permit any use of the Premises that could with the passage of time result in
the creation of any right of use, or any claim of adverse possession or
easement on, to or against any part of the Premises in favor of any person
or entity or the public;

 

(f)                      allow
any of the following to occur (unless a Permitted Transfer) except as expressly
permitted herein:

 

(i)                       a
Transfer of all or any portion of the Premises or any interest in the Premises;

 

(ii)                    a
Transfer of any ownership interest in Borrower or any entity which owns, directly
or indirectly, an interest in Borrower at any level of the ownership structure;
or

 

(iii)                 in addition to (i) and (ii) above,
if the Borrower is a trust, or if a trust owns an interest, directly or
indirectly, in any entity which owns an interest in Borrower at any level of
the ownership structure, the addition, deletion or substitution of a trustee of
such trust; or

 

If any of such events occur, it shall be null and void
and shall constitute an Event of Default under the Loan Documents.

 

It is understood and agreed that the Indebtedness
evidenced by the Note is personal to Borrower and in reliance upon the
ownership structure of Borrower

 

8

 

and in accepting the same Lender has relied upon what
it perceived as the willingness and ability of Borrower and the Interest Owners
to perform its obligations under the Loan Documents and the Environmental
Indemnity and as lessor under the Leases of the Premises. Furthermore, Lender may consent
to a Transfer and expressly waive Borrower’s covenants contained in this
paragraph 2(f), in writing to Borrower; however any such consent and waiver
shall not constitute any consent or waiver of such covenants as to any Transfer
other than that for which the consent and waiver was expressly granted.
Furthermore, Lender’s willingness to consent to any Transfer and waive Borrower’s
covenants contained in this paragraph 2(f), implies no standard of
reasonableness in determining whether or not such consent shall be granted and
the same may be based upon what Lender solely deems to be in its best
interest.

 

For purposes of the Loan Documents, the following
terms shall have the respective meanings set forth below:

 

“Transfer” or “Transferred” shall mean
with respect to the Premises, an interest in the Premises, or an ownership
interest or interest therein:

 

(i)                       a
sale, assignment, transfer, conveyance or other disposition (whether voluntary,
involuntary or by operation of law);

(ii)                    the
creation, sufferance or granting of any lien, encumbrance, security interest or
collateral assignment (whether voluntarily, involuntarily or by operation of
law), other than the lien hereof, the leases of the Premises assigned to
Lender, the Permitted Encumbrances, the granting of a lien on a tenant’s interest
under any Lease in accordance with the terms specifically set forth therein,
and those liens which Borrower is contesting in accordance with the provisions
of paragraph l(e);

(iii)                 the issuance or other creation of
ownership interests in an entity;

(iv)                the
reconstitution or conversion from one entity to another type of entity;

(v)                   a
merger, consolidation, reorganization or any other business combination; or

(vi)                a
conversion to or operation of all or any portion of the Premises as a
cooperative or condominium form of ownership.

 

“Permitted Transfer” shall mean:

 

(i)                       a
minor (as determined by Lender) conveyance of an interest in the Premises by
Borrower, such as a utility easement, and for which Lender has given its prior
written consent and imposed such conditions as Lender deems advisable and
appropriate; provided, however, with regard to those easements for which Lender’s
consent is required, if: (A) Borrower provides Lender with a written
request for consent to such easement and the request is accompanied by a copy
of the proposed easement together with a certificate executed by Borrower
confirming that such easement

 

9

 

will not adversely affect the Premises now or in the
future; (B) the request is given in the manner provided for the giving of
notices in this Mortgage; (C) the request is boldly noted as a request for
consent to an easement for which Lender’s consent is required and specifically
states that the easement will be deemed approved if Lender fails to respond
within 12 business days (Lender and Borrower hereby agree that such 12 business
day period shall commence on the date of Lender’s actual receipt of all
information reasonably required by Lender in connection with Lender’s review of
said easement); and (D) in the event Lender fails to respond to Borrower’s
request for consent within the time period set forth in subparagraph (C) above,
then said consent shall be deemed to have been given; or;

 

(ii)                    a
sale, assignment, transfer or conveyance of all or any portion of the Premises
or an interest in the Premises for which Borrower has complied with all of the
Property Transfer Requirements; or

 

(iii)                 any of the following Transfers for
which Borrower has complied with all of the Ownership Transfer Requirements as
applicable and Lender has given its prior written consent (and in connection
with such consent, Lender may impose any conditions it wishes in its sole
discretion);

 

(A)                  a
sale, assignment, transfer, or conveyance of an ownership interest or interest
therein;

 

(B)                  the
issuance or other creation of ownership interests in an entity;

 

(C)                  a
reconstitution or conversion from one entity to another type of entity;

 

(D)                  a
merger, consolidation, reorganization or any other business combination;

 

(iv)                with
at least thirty (30) days advance written notice, transfers of ownership
interests in Borrower and entities owning interests in Borrower among Inland
American Real Estate Trust, Inc., a Maryland corporation (“IARETI”), and
its wholly owned Affiliates for which Borrower has complied with all of the
Specific Transfer Requirements -1;

 

(v)                   with
at least thirty (30) days advance written notice, transfers of ownership
interests in Borrower and/or shares in entities owning interests in Borrower to
Qualified New Members (hereinafter defined), for which Borrower has complied
with all of the Specific Transfer Requirements - 2 (for purposes of this
Permitted Transfer, a “Qualified New Member” shall be defined as an
institutional investor or fund managed by an institutional investor having
assets of $100,000,000 or more);

 

10

 

(vi)                with
at least thirty (30) days advance written notice, transfers of direct or
indirect ownership interests in Borrower and entities owning interests in
Borrower and transfers of direct or indirect ownership interests in IARETI to a
Qualified Successor (hereinafter defined) for which Borrower has complied with
all of the Specific Transfer Requirements - 3 (for purposes of this Permitted
Transfer, a “Qualified Successor” shall be defined as an entity with a tangible
net worth of $200,000,000 or more; a debt to equity ratio of 1.5 or less; and
management personnel experienced in the ownership and management of retail
properties similar to the Premises);

 

(vii)             transfers of ownership interests in IARETI
or, provided IARETI is the surviving entity, the merger of IARETI with any of
the following entities: (A) Inland Retail Real Estate Trust, Inc., a
Maryland corporation (“IRRETI”), (B) Inland Real Estate Corporation, a
Maryland corporation (“IREC”), (C) Inland Real Estate Investment
Corporation, a Delaware corporation (“IREIC”), (D) Inland Western Retail
Real Estate Trust, Inc., a Maryland corporation (“IWRRETI”), (E) any
other real estate investment trust sponsored by IREIC, or (F) any other
entity composed entirely of any of the foregoing, by merger or other business
combination; or

 

(viii)          one time sale, assignment, transfer or
conveyance of the Premises to a Permitted Inland REIT for which Borrower has
complied with all of the One-Time Permitted Inland REIT Property Transfer
Requirements; or

 

(ix)                a
one time sale, assignment, transfer or conveyance of: (a) 100% of the
ownership interests in Borrower to a joint venture of a Permitted Inland REIT,
a New Inland REIT or an Inland Affiliate with a Qualified Entity; or (b) up
to 99% of the ownership interests in Borrower to a Qualified Entity, in either
case for which Borrower has complied with all of the One-Time Joint Venture
Ownership Transfer Requirements; or

 

(x)                   a
one time sale, assignment, transfer or conveyance of the Premises to a joint
venture of a Permitted Inland REIT, a New Inland REIT or an Inland Affiliate
with a Qualified Entity for which Borrower has complied with all of the
One-Time Joint Venture Property Transfer Requirements.

 

“Permitted Inland REIT” shall collectively
mean: IRRETI, IREC, IWRRETI and IARETI.

 

“Qualified Entity” shall mean an entity with: (a) a
net worth equal to or greater than $25,000,000.00; and (b) experience in
the ownership and management of properties similar to the Premises.

 

11

 

“New Inland REIT” shall mean: a newly formed
real estate investment trust sponsored by or affiliated with IREIC, a
Permitted Inland REIT or The Inland Group, Inc., an Illinois corporation (“TIGI”).

 

“Inland Affiliates” shall mean: subsidiaries
directly or indirectly wholly owned by a Permitted Inland REIT or a New Inland
REIT, or partnerships, trusts or limited liability companies or other entities
in which all of the equity interests are owned by a Permitted Inland REIT, a
New Inland REIT or TIGI.

 

In the event there is any: (a) transfer of the
Premises; or (b) transfer of direct or indirect ownership interests in
Borrower greater than 49%; then, if required by the Pooling and Servicing
Agreement, Lender may require receipt of written evidence from such
agency(ies) (if required by such agencies) to the effect that the proposed
transfer will not result in a re-qualification, reduction or withdrawal of any
rating in effect immediately prior to such transfer issued in connection with
the securitization transaction.

 

“One-Time Permitted Inland REIT Property Transfer
Requirements” are all of the following:

 

1.                        the
Permitted Inland REIT which is to become the successor borrower has a net worth
equal to or greater than such Permitted Inland REIT’s net worth as of the date
hereof.

 

2.                        Lender’s
exposure limitations to the successor borrower are acceptable to Lender;

 

3.                        an
experienced individual or entity, acceptable to Lender, continues to manage and
lease the Premises;

 

4.                        Borrower
satisfies subparagraphs 3 through 7 of the Property Transfer Requirements set
forth below; and

 

5.                        payment
to Lender of an assumption fee equal to one half of one percent (0.5%) of the
principal balance of the Note; provided, however, such fee shall not exceed
$25,000 and shall not be less than $10,000. Lender will require $5,000.00 of
such fee to be paid at the beginning of Lender’s review process, and such sum
shall be nonrefundable and earned upon receipt by Lender whether or not the
transaction is ultimately completed or Lender ultimately approves successor
borrower.

 

“One-Time Joint Venture Ownership Transfer
Requirements” are all of the following:

 

12

 

1.                        If
the transfer is pursuant to Permitted Transfer (ix)(a) above, IARETI or a
wholly owned Affiliate thereof: (i) maintains at least 1% ownership
interests in such joint venture (which such joint venture entity shall be the
sole member of Borrower); and (ii) maintains operational and managerial
control of such joint venture and the Premises. If the transfer is pursuant to
Permitted Transfer (ix)(b), IARETI or a wholly owned Affiliate thereof: (a) maintains
at least 1% interest in Borrower; and (b) maintains operational and
managerial control of the Premises;

 

2.                        Lender’s
receipt of an ownership processing fee equal to: (i) $5,000.00 if IARETI
maintains ten percent (10%) or more of the ownership interests in Borrower or
such joint venture that acquires ownership interests in Borrower; or (ii) $15,000.00
if IARETI maintains less than 10 percent (10%) of the ownership interests in
Borrower or such joint venture that acquires ownership interests in Borrower;

 

3.                        At
Lender discretion, Lender receives acceptable background and credit checks, at
Borrower’s cost.;

 

4.                        Reaffirmation
of the obligations of IARETI under the Guaranty;

 

5.                        Lender
receives at least thirty (30) days prior written notice of such transfer along
with appropriate documentation thereof (including organizational documentation
evidencing the formation and existence of any entity to which an interest is
transferred);

 

6.                        The
transaction will be processed by outside counsel whose fees and costs, as well
as other applicable professional’s fees and costs, taxes, recording fees and
the like, and any other fees and costs incurred, will be payable by Borrower.
(Lender shall not charge any fees beyond the fee referenced in No. 2
above).

 

“One-Time Joint Venture Property Transfer Requirements”
are all of the following:

 

1.                        IARETI
or a wholly owned Affiliate thereof: (i) maintains at least 1% direct or
indirect ownership interests in the joint venture that becomes Borrower; and (ii) maintains
operational and managerial control of the joint venture that becomes Borrower
and the Premises;

 

2.                        Lender’s
receipt of a Premises processing fee equal to: (i) $5,000.00 if IARETI
maintains ten percent (10%) or more of the ownership interests in such joint
venture; or (ii) $15,000.00 if IARETI maintains less than 10 percent (10%)
of the ownership interests in such joint venture;

 

13

 

3.                        Receipt,
at Borrower’s expense, of an endorsement updating the Lender’s existing loan
policy in the full amount of the Loan (and if an acceptable endorsement is not
available, a new ALTA standard loan policy), in form and by an issuer
satisfactory to Lender, and which insures this Mortgage to be a first and prior
lien subject only to those exceptions which were previously approved by Lender
or additional exceptions that are subject to Lender’s reasonable prior
approval;

 

4.                        Receipt
by Lender of copies of (a) the organizational documents of the proposed
transferee and an opinion of counsel satisfactory to Lender as to its due
formation, valid existence and authority to enter into and carry out the
proposed transaction; (b) the deeds or other instruments of transfer and
documents relating to the assignment and assumption of Leases; (c) evidence
of compliance with the insurance requirements contained in the Loan Documents; (d) compliance
with the representations and warranties in the Loan Agreement regarding the
proposed transferee’s status as a Single Purpose Entity, and (e) at Lender
discretion, acceptable background and credit checks, at Borrower’s cost;

 

5.                        Execution,
delivery, acknowledgment and recordation, as applicable, of assumption
agreements, financing statements, replacement letter(s) of credit (if
applicable), tax identification certification, automatic clearing house payment
form, and UCCs (in form and substance satisfactory to Lender) and
reaffirmation of the obligations of IARETI under the Guaranty;

 

6.                        The
transaction will be processed by outside counsel whose fees and costs, as well
as other applicable professional’s fees and costs, taxes, recording fees and
the like, and any other fees and costs incurred, will be payable by Borrower.
(Lender shall not charge any fees beyond the fee referenced in No. 2
above.);

 

7.                        Receipt
by Lender of 30 days advance written notice of the proposed Transfer in
question;

 

8.                        Receipt
by Lender of a waiver from any tenant having a right or option to purchase the
Premises or any portion thereof, waiving such right or option in form and
substance acceptable to Lender; and

 

9.                        Borrower
remains a Single Purpose Entity.

 

“Property Transfer Requirements” are all of the
following:

 

14

 

1.                        Prior
review and approval of the proposed purchaser or other transferee and the
subject transaction by Lender, at Lender’s sole discretion. Review of the
proposed purchaser or other transferee and the subject transaction shall
encompass various factors, including, but not limited to, the proposed
purchaser’s or other transferee’s creditworthiness, financial strength, and
real estate management and leasing expertise as well as the proposed
transaction’s effect on the Premises, the Borrower, and other security for the
Loan;

 

2.                        Payment
to Lender of an assumption fee equal to the greater of: (a) one half of
one percent (0.5%) of the principal balance of the Note; or (b) $15,000.00;
provided, however, that Lender will require $15,000.00 of such fee to be paid
at the beginning of Lender’s review process, and such sum shall be
nonrefundable and earned upon receipt by Lender whether or not the transaction
is ultimately completed or Lender ultimately approves the proposed purchaser or
other transferee;

 

3.                        Receipt,
at Borrower’s expense, of either (at Lender’s discretion) a new ALTA standard
loan policy or an endorsement updating the Lender’s existing loan policy in the
full amount of the Loan, in form and by an issuer satisfactory to Lender,
and which insures this Mortgage to be a first and prior lien subject only to
those exceptions which were previously approved by Lender and provides coverage
against usury and mechanic’s liens;

 

4.                        Receipt
by Lender of copies of all relevant information and documentation relating to
or required by Lender in connection with the proposed transfer including but
not limited to (a) the organizational documents of the proposed transferee
and an opinion of counsel satisfactory to Lender as to its due formation, valid
existence and authority to enter into and carry out the proposed transaction; (b) the
deeds or other instruments of transfer and documents relating to the assignment
and assumption of Leases; (c) evidence of compliance with the insurance
requirements contained in the Loan Documents; (d) compliance with the
representations and warranties in the Loan Agreement regarding the proposed
transferee’s status as a Single Purpose Entity, and (e) compliance with
such other closing requirements as are customarily imposed by Lender in
connection with such transactions;

 

5.                        Execution,
delivery, acknowledgment and recordation, as applicable, of new, revised and/or
replacement assumption agreements, loan modification agreements,
indemnification agreements, escrow security or property reserves agreements,
security instruments, financing statements, UCCs, new or revised letters of
credit and/or guarantees in form and substance satisfactory to Lender;

 

15

 

6.                        Payment
of outside counsel fees and costs, other applicable professional’s fees and
costs, taxes, recording fees and the like, and any other fees and costs
incurred;

 

7.                        Receipt
by Lender of 60 days advance written notice of the proposed Transfer in
question;

 

8.                        Receipt
by Lender of a waiver from any tenant having a right or option to purchase the
Premises or any portion thereof, waiving such right or option in form and
substance acceptable to Lender; and

 

9.                        At
Lender’s option, and if required by the procedures promulgated by any rating
agency(ies) associated with a securitization transaction with respect to the
Loan, receipt by Lender of written evidence from such agency(ies) to the effect
that the proposed transfer will not result in a re-qualification, reduction or
withdrawal of any rating in effect immediately prior to such transfer issued in
connection with the securitization transaction.

 

“Ownership Transfer Requirements” are all of
the Property Transfer Requirements which Lender deems appropriate in its
discretion, as well as a reasonable processing fee to be determined by Lender;
provided, however, that (i) with respect to item 2 of the Property
Transfer Requirements, the 0.5% component of the fee shall be prorated
(subject, however, to the $15,000 minimum) based on Lender’s calculation of the
effective percentage interest in Borrower transferred, and (ii) item 3 of
the Property Transfer Requirements shall be required, at Lender’s discretion,
only in the event of (A) a merger, consolidation, reorganization or any
other business combination, or (B) a reconstitution or conversion from one
entity to another type of entity.

 

“Specific Transfer Requirements -1” are all of
the following which Borrower agrees to provide to Lender prior to each proposed
transfer: (i) a processing fee of $2,000.00; (ii) all relevant
documentation and information related to the organization, authority, and
validity of the proposed ownership interest purchaser, transferee and the
transaction in general; (iii) all documents and instruments of conveyance,
transfer and assignment; (iv) at Lender’s discretion, a reaffirmation of
the obligations of the Guarantor(s) under the Guaranty; and (v) evidence
of payment of all outside counsel fees, professional fees, title insurance
fees, if any, and any and all other fees, costs and expenses related to the
proposed transfer (provided that no processing fee other than the $2,000 fee
stated in (i) above shall be required).

 

“Specific Transfer Requirements - 2” are all of
the following which Borrower agrees to provide to Lender prior to each proposed
transfer: IARETI or a wholly owned Affiliate thereof (i) (a) retains
51% or more of the ownership interest in

 

16

 

the Borrower, or (b) retains ownership of 20% to
50% of the ownership interest in the Borrower subject to Lender’s review and
approval in each instance of the proposed transferee and the subject
transaction; Lender’s review of the proposed transferee and the subject
transaction shall encompass various factors, including but not limited to,
transferee’s creditworthiness, financial strength, and real estate management
expertise, as well as the proposed transaction’s effect on the Premises,
Borrower and the other security for the Loan, and (ii) otherwise retains
operational and management control of Borrower as determined by Lender, and
further provided Borrower provides Lender each of the following items prior to
each proposed transfer: (a) a transfer fee equal to the greater of
$5,000.00 or the product of the percentage ownership interest in Borrower to be
transferred multiplied by one percent (1%) of the outstanding principal balance
of the Loan; (b) all relevant documentation and information related to the
organization, authority, and validity of the proposed ownership interest
purchaser, transferee and the transaction in general; (c) all documents
and instruments of conveyance, transfer and assignment; (d) a
reaffirmation of the obligations of the Guarantor(s) under the Guaranty; and (e) evidence
of payment of all outside counsel fees, professional fees, title insurance fees
and any and all other fees, costs and expenses related to the proposed transfer
(provided that no assumption or transfer fee other than the $5,000.00 fee
stated in (a) above shall be required).

 

“Specific Transfer Requirements - 3” are all of
the following which Borrower agrees to provide to Lender prior to each proposed
transfer: (i) said transfers are made to accommodate either the merger of
IARETI with the Qualified Successor or the sale of a majority of IARETI’s
assets to the Qualified Successor; and (ii) the Qualified Successor
retains direct or indirect ownership of 51% or more of the ownership interests
in the Borrower and (iv) the Qualified Successor otherwise retains
operational and management control of Borrower as determined by Lender, and
further provided, Borrower provides Lender with each of the following items
prior to the proposed transfer: (a) a transfer fee of $10,000.00; (b) all
relevant documentation and information related to the organization, authority,
and validity of the proposed ownership interest purchaser, transferee and the
transaction in general; (c) all documents and instruments of conveyance,
transfer and assignment; (d) a reaffirmation of the obligations of the
Guarantor(s) under the Guaranty or assumption thereof by an individual(s) or
entity(ies) acceptable to Lender in its sole discretion; and (e) evidence
of payment of all outside counsel fees, professional fees, title insurance fees
and any and all other fees, costs and expenses related to the proposed transfer
(provided that no assumption or transfer fee other than the $10,000.00 fee stated
in (a) above shall be required).

 

(g)                     cause,
permit or allow:

 

(i)                       any
person or entity to own an interest in Borrower who is (A) identified on
the Specially Designated Nationals and Blocked Persons List maintained by OFAC
and/or on any other similar list maintained by

 

17

 

OFAC, or (B) a party with whom a citizen of the
United States is prohibited to engage in transactions by any trade embargo,
economic sanction, or other prohibition of United States law, regulation, or
Executive Order of the President of the United States;

(ii)                    any
of the funds or other assets of Borrower to constitute property of, or be
beneficially owned, directly or indirectly, by any Embargoed Person;

(iii)                 an Embargoed Person to have any
interest of any nature whatsoever in Borrower (whether directly or indirectly);
or

(iv)                any
of its funds to be derived from any unlawful activity with the result that the
investment in Borrower is prohibited by law or that the agreement is in violation
of law.

 

3.     (a)                             Borrower
shall pay or cause to be paid when due and before any penalty attaches or
interest accrues all general taxes, special taxes, assessments (including
assessments for benefits from public works or improvements whenever begun or
completed), utility charges, water charges, sewer service charges, common area
maintenance charges, if any, vault or space charges and all other like charges
against or affecting the Premises or against any property or equipment located
on the Premises, or which might become a lien on the Premises, and shall,
within 10 days following Lender’s request, furnish to Lender a duplicate
receipt of such payment. If any such tax, assessment or charge may legally
be paid in installments, Borrower may, at its option, pay such tax, assessment
or charge in installments. Borrower shall not claim or demand or be entitled to
any credit on account of the Indebtedness secured hereby for any part of
the taxes paid with respect to the Premises or part thereof, and no
deduction shall otherwise be made or claimed from the taxable value of the
Premises, or any part thereof, by reason of this Mortgage. Further, in the
event of the passage of any law of the United States or of the State of New
Jersey providing for the taxation of any mortgages or debts secured by
mortgage, for federal, state or local purposes, so as to affect this Mortgage,
Borrower shall pay when due, or reimburse Lender on demand for the payment of,
such tax. Lender acknowledges and agrees that performance of the obligations
set forth in this Paragraph 3(a) by Major Tenant with respect to its
leased premises shall be deemed compliance with such provisions by Borrower
with respect to such portion of the Premises.

 

(b)                    If
Borrower desires to contest any tax, assessment or charge relating to the
Premises, Borrower may do so by paying the same in full, under protest, in
the manner provided by law; provided, however, that

 

(i)                       if
contest of any tax, assessment or charge may be made without the payment
thereof, and

 

18

 

(ii)                    such
contest shall have the effect of preventing the collection of the tax,
assessment or charge so contested and the sale or forfeiture of the Premises or
any part thereof or any interest therein to satisfy the same,

 

then Borrower may in its discretion and upon the
giving of written notice to Lender of its intended action and upon the
furnishing to Lender of such security or bond as Lender may require,
contest any such tax, assessment or charge in good faith and in the manner
provided by law. All costs and expenses incidental to such contest shall be
paid by Borrower. In the event of a ruling or adjudication adverse to Borrower,
Borrower shall promptly pay such tax, assessment or charge. Borrower shall indemnify
and save harmless the Lender and the Premises from any loss or damage arising
from any such contest and shall, if necessary to prevent sale, forfeiture or
any other loss or damage to the Premises or to Lender, pay such tax, assessment
or charge or take whatever action is necessary to prevent any sale, forfeiture
or loss. Lender acknowledges and agrees that upon compliance with the foregoing
requirements, to the extent permitted under its Lease, Major Tenant shall have
all rights of contest as set forth in this Paragraph 3(b).

 

4.     (a)                             Borrower
covenants that the buildings on the Premises shall be kept insured against loss
by fire for the benefit of Lender. Further, Borrower shall at all times keep or
cause to be kept in force (i) property insurance insuring all Improvements
which now are or hereafter become a part of the Premises for perils
covered by a causes of loss-special form insurance policy, including
coverage against terrorism containing both replacement cost and agreed amount
endorsements or equivalent coverage; (ii) commercial general liability
insurance naming Lender as an additional insured protecting Borrower and Lender
against liability for bodily injury or property damage occurring in, on or
adjacent to the Premises in commercially reasonable amounts; (iii) boiler
and machinery insurance if the property has a boiler or is an office building; (iv) rental
value insurance for the perils specified herein for one hundred percent (100%)
of the Rents (including operating expenses, real estate taxes, assessments and
insurance costs which are lessee’s liability) for a period of twelve (12)
months; (v) builders risk insurance during all periods of construction;
and (vi) insurance against all other hazards as may be reasonably
required by Lender, including, without limitation, insurance against loss or
damage by flood. Notwithstanding anything herein above to the contrary, if
neither: (i) property insurance without an exclusion for terrorism,
terrorist acts or similar perils (“Terrorism”) nor; (ii) a separate policy
insuring specifically against Terrorism is available at a cost which is in
Lender’s opinion is commercially reasonable, taking into consideration, among
other things: (a) how properties similar in type, size, quality and
location are insured with respect to Terrorism; and (b) the amount of
coverage, premium and deductible applicable to such insurance, then Lender
agrees to waive the requirement to

 

19

 

provide insurance covering Terrorism until such
coverage again becomes available at a cost, which in Lender’s opinion is
commercially reasonable.

 

(b)                    All
insurance (including deductibles and exclusions) shall be in form, content and
amounts approved by Lender and written by an insurance company or companies
approved by Lender and rated A-, class size VIII or better in the most
current issue of Best’s Insurance Reports and which is licensed to do business
in the State in which the Premises are located or a governmental agency or
instrumentality approved by Lender. The policies for such insurance shall have
attached thereto standard mortgagee clauses in favor of and permitting Lender
to collect any and all proceeds payable thereunder and shall include a 30 day
(except for nonpayment of premium, in which case, a 10 day) notice of
cancellation clause in favor of Lender. All certificates of insurance (or
policies if requested by Lender) shall be delivered to and held by Lender as
further security for the payment of the Note and any other obligations arising
under the Loan Documents, with evidence of renewal coverage delivered to Lender
at least 30 days before the expiration date of any policy. Borrower shall not
carry or permit to be carried separate insurance, concurrent in kind or form and
contributing in the event of loss, with any insurance required in the Loan
Documents.

 

(c)                     To
the contrary notwithstanding, so long as there is no Event of Default hereunder
and so long as the lease with Major Tenant or any Replacement Tenant remains in
full force and effect and there are no material breaches thereof beyond the
expiration of any applicable notice and cure periods, Lender will allow Major
Tenant or any said Replacement Tenant to keep in force the insurance required
herein, except with respect to coverage for rental insurance, and such
performance by Major Tenant shall be deemed performance by Borrower with
respect to such required insurance hereunder. All insurance coverages and
requirements that are not maintained by Major Tenant or a Replacement Tenant in
accordance with the Lender’s insurance requirements herein shall at all times
during the Loan be maintained by Borrower.

 

(d)                    To
the contrary notwithstanding, so long as there is no Event of Default hereunder
and so long as the lease between Borrower and Major Tenant remains in full
force and effect and there are no material breaches thereof beyond the
expiration of any applicable notice and cure periods, Lender agrees to accept
self-insurance by Major Tenant for its leased premises. Lender will only accept
self-insurance by Major Tenant under the terms of its lease if Major Tenant
maintains an investment grade credit rating as required by its Lease. All
insurance coverages and requirements that are not self insured by Major Tenant
in accordance with the Lender’s insurance requirements herein shall at all
times during the Loan be maintained by Major Tenant or Borrower (with the
exception of coverage for rental insurance, which shall be provided by
Borrower).

 

20

 

5.                        Borrower
shall deposit with and pay to Lender the estimated taxes and assessments
assessed or levied against and next due on the Premises and the estimated
premiums for the insurance required pursuant to the Loan Documents, all in
accordance with and subject to the requirements of the Loan Agreement.

 

6.                        In
the event of any damage to or destruction of the Premises, or any part thereof:

 

(a)                    Borrower
will immediately notify Lender thereof in the manner provided in this Mortgage
for the giving of notices. Lender shall have the right (which may be
waived by Lender in writing) to settle and adjust any claim under such
insurance policies required to be maintained by Borrower. In all circumstances,
the proceeds thereof shall be paid to Lender and Lender is authorized to
collect and to give receipts therefor. Borrower agrees and acknowledges that
such proceeds shall be held by Lender without any allowance of interest and
that in any bankruptcy proceeding of Borrower, all such proceeds shall be
deemed to be “Cash Collateral” as that term is defined in Section 363 of
the Bankruptcy Code. Provided that no Event of Default exists, Borrower shall
have the right to participate in any settlement or adjustment; provided,
however, that any settlement or adjustment shall be subject to the written
approval of Lender, not to be unreasonably withheld.

 

(b)                    Such
proceeds, after deducting therefrom any reasonable expenses incurred by Lender
in the collection thereof (including but not limited to reasonable attorneys’
fees and costs), shall be applied by Lender to pay the Indebtedness secured
hereby including, but not limited to the Make Whole Premium, whether or not
then due and payable, provided, however, that if no Event of Default exists at
the time of such application, no Make Whole Premium shall be due.

 

Notwithstanding anything hereinabove to the contrary,

 

(i)                       in
the event the casualty occurs more than six (6) months prior to the
Maturity Date and no Event of Default exists, Lender shall apply such proceeds
as follows:

 

(A)                  If
the aggregate amount of such proceeds is less than $250,000, Lender shall pay
such proceeds directly to Borrower, to be held in trust for Lender and applied
to the cost of rebuilding and restoring the Premises.

 

(B)                  If
the aggregate amount of such proceeds equals or exceeds $250,000 Lender shall
disburse such amounts of the proceeds as Lender reasonably deems necessary for
the repair or replacement of the Premises, subject to the conditions set forth
in paragraph 6(c) below.

 

21

 

(ii)                    in
the event (x) an Event of Default exists, or (y) the casualty occurs during the
last six (6) months prior to the Maturity Date and Lender determines that
the repair and restoration of such casualty cannot be completed prior to the
Maturity Date, or (z) the conditions set forth in paragraph 6(c) are not
met, then Lender, in its sole and absolute discretion may either:

 

(A)                  declare
the entire Indebtedness to be immediately due and payable, provided, however,
that if no Event of Default exists, no Make Whole Premium shall be due. All
proceeds shall be applied toward payment of the Indebtedness in such priority
as Lender elects; or

 

(B)                  disburse
such proceeds as Lender reasonably deems necessary for the repair or replacement
of the Premises subject to those conditions set forth in paragraph 6(c) which
Lender in its sole and absolute discretion may require.

 

(c)      (i)                          In the
event that Borrower is to be reimbursed out of the insurance proceeds or out of
any award or payment received with respect to a Taking, Lender shall from time
to time make available such proceeds, subject to the following conditions: (a) there
continues to exist no Event of Default; (b) the delivery to Lender of
satisfactory evidence of the estimated cost of completion of such repair and
restoration work and any architect’s certificates, waivers of lien, contractor’s
sworn statements, and other evidence of cost and of payment and of the
continued priority of the lien hereof over any potential liens of mechanics and
materialmen (including, without limitation, title policy endorsements) as
Lender may reasonably require and approve; (c) the time required to
complete the repair and restoration work and for the income from the Premises
to return to the level it was prior to the loss will not exceed the coverage
period of the rental value insurance required hereunder, (d) the annual
net cash flow (annual net operating income after deduction for tenant
improvements, leasing commissions, annual replacement reserves and a management
fee) shall equal or exceed 1.5 times the annual debt service on the Note. Only
net operating income from approved executed Leases in effect on the Premises,
having at least three (3) years remaining prior to the expiration of their
term, with no uncured defaults, shall be used in Lender’s determination of the
annual net cash flow; (e) Lender approves the plans and specifications of
such work before such work is commenced if the estimated cost of rebuilding and
restoration exceeds 25% of the Indebtedness or involves any structural changes
or modifications. If said plans and specifications substantially comply with
those previously approved by Lender, Lender’s approval shall not be
unreasonably

 

22

 

withheld; (f) if the amount of any insurance
proceeds, award or other payment is insufficient to cover the cost of restoring
and rebuilding the Premises, Borrower shall pay such cost in excess of such
proceeds, award or other payment before being entitled to reimbursement out of
such funds; (g) Borrower pays to Lender a non-refundable processing fee
equal to the greater of $5,000.00 or .25% of the amount of such proceeds within
sixty (60) days of the occurrence of any such damage or destruction and before
Lender disburses any proceeds; and (h) such other conditions to such
disbursements, in Lender’s reasonable discretion, as would be customarily
required by a construction lender doing business in the area where the Premises
is located or which are otherwise required by any rating agency rating a
securitization transaction with respect to the Loan.

 

(ii)                    No
payment made by Lender prior to the final completion of the repair or
restoration work shall, together with all payments theretofore made, exceed 90%
of the cost of such work performed to the time of payment, and at all times the
undisbursed balance of said proceeds shall be at least sufficient to pay for
the cost of completion of such work free and clear of all liens. Any proceeds
remaining after payment of the cost of rebuilding and restoration shall, at the
option of Lender, either be (a) applied in reduction of the Indebtedness
secured hereby, provided, however, that if no Event of Default exists at the
time of such application, no Make Whole Premium shall be due, or (b) paid
to Borrower.

 

(iii)                 Repair and restoration of the Premises
shall be commenced promptly after the occurrence of the loss and shall be
prosecuted to completion diligently, and the Premises shall be so restored and
rebuilt to substantially the same character and quality as prior to such damage
and destruction and shall comply with all Legal Requirements.

 

(d)                    Should
such damage or destruction occur after foreclosure or sale proceedings have
been instituted, the proceeds of any such insurance policy or policies, if not
applied in rebuilding or restoration of the Improvements, shall be used to pay (i) the
Indebtedness then due and owing in the event of a non-judicial sale in such
priority as Lender elects, or (ii) the amount due in accordance with any
decree of foreclosure or deficiency judgment that may be entered in
connection with such proceedings, and the balance, if any, shall be paid to the
owner of the equity of redemption if it shall then be entitled to the same, or
otherwise as any court having jurisdiction may direct.

 

(e)                     To
the contrary notwithstanding, so long as there is no Event of Default hereunder
and so long as the Lease with Major Tenant remains in full force and effect,
Lender agrees that the provisions of the Lease with Major Tenant governing the
application of insurance proceeds and restoration shall apply with respect to
the portion of the Premises subject to such Lease.

 

23

 

7.                        In
the event of the commencement of a Taking affecting the Premises:

 

(a)                    Borrower
shall notify Lender thereof in the manner provided in this Mortgage for the
giving of notices. Lender may participate in such proceeding, and Borrower
shall deliver to Lender all documents requested by it to permit such
participation.

 

(b)                    Borrower
shall cause the proceeds of any award or other payment made relating to a
Taking, to be paid directly to Lender. Lender, in its sole and absolute
discretion: (i) may apply all such proceeds to pay the Indebtedness
in such priority as Lender elects, provided however, that if no Event of
Default exists at the time of such application no Make Whole Premium shall be
due; or (ii) subject to and in accordance with the provisions set forth in
paragraph 6(c) above, may disburse such amounts of the proceeds as
Lender reasonably deems necessary for the repair or replacement of the
Premises.

 

(c)                     Notwithstanding
anything herein above to the contrary, provided no Event of Default exists,
Lender agrees to disburse the proceeds received from any Inconsequential
Taking, as hereinafter defined, to Borrower for the repair and/or replacement
of the Premises. An Inconsequential Taking shall be a Taking which (i) results
in less than $250,000 in proceeds; (ii) does not, in Lender’s determination,
materially or adversely affect the Improvements, parking, access, ingress,
egress or use of the Premises; and (iii) does not trigger any rights or
options of tenants under the Leases.

 

(d)                    To
the contrary notwithstanding, so long as there is no Event of Default hereunder
and so long as the Lease with Major Tenant remains in full force and effect,
Lender agrees that the provisions of the Lease with Major Tenant governing the
application of the proceeds of a Taking shall apply with respect to that portion
of the Premises subject to such Lease.

 

8.                        If
by the laws of the United States of America or of any state or governmental
subdivision having jurisdiction over Borrower or of the Premises or of the Loan
evidenced by the Loan Documents or any amendments or modifications thereof, any
tax or fee is due or becomes due or is imposed upon Lender in respect of the
issuance of the Note hereby secured or the making, recording and registration
of this Mortgage or otherwise in connection with the Loan Documents, the Environmental
Indemnity or the Loan, except for Lender’s income or franchise tax, Borrower
covenants and agrees to pay such tax or fee in the manner required by such law,
and to hold harmless and indemnify Lender, its successors and assigns, against
any liability incurred by reason of the imposition of any such tax or fee.

 

9.      (a)                          Upon the
occurrence of any Event of Default, Lender may, but need not, make any payment
or perform any act herein required of Borrower, in any form and

 

24

 

manner deemed expedient and may, but need not, make
full or partial payments of principal or interest on prior encumbrances, if
any, and purchase, discharge, compromise or settle any tax lien or other prior
lien or title or claim thereof, or redeem from any tax sale or forfeiture
affecting said Premises, or contest any tax or assessment. All moneys paid for
any of the purposes herein authorized and all reasonable expenses paid or
incurred in connection therewith, including but not limited to, reasonable
attorneys’ fees and costs and reasonable attorneys’ fees and costs on appeal,
and any other money advanced by Lender to protect the Premises and the lien
hereof, shall be so much additional Indebtedness secured hereby and shall become
immediately due and payable without notice and with interest thereon at the
Default Rate from the date of expenditure or advance until paid.

 

(b)                    In
making any payment hereby authorized relating to taxes or assessments or for
the purchase, discharge, compromise or settlement of any prior lien, Lender may make
such payment according to any bill, statement or estimate secured from the
appropriate public office without inquiry into the accuracy thereof or into the
validity of any tax, assessment, sale, forfeiture, tax lien or title or claim
thereof or without inquiry as to the validity or amount of any claim for lien
which may be asserted.

 

10.                 If
one or more of the following events (herein called an “Event of Default”
or “Events of Default” as the context so requires) shall have occurred:

 

(a)                    failure
to pay when due any principal, interest, Make Whole Premium or other
Indebtedness, utilities, taxes or assessments or insurance premiums required
pursuant to the Loan Documents or the Environmental Indemnity, and such failure
shall have continued for 5 days, as to payment of any principal, interest or
taxes or assessments, or insurance premiums or for 5 days after written notice
specifying such default is given by Lender to Borrower as to payment of any Make
Whole Premium; or

 

(b)                    Borrower,
Interest Owner or any guarantor voluntarily brings or acquiesces to any of the
following: (A) any action for dissolution, act of dissolution or
dissolution or the like of Borrower, Interest Owner or any guarantor under the
Federal Bankruptcy Code as now or hereafter constituted; (B) the filing of
a petition or answer proposing the adjudication of Borrower, Interest Owner or
any guarantor as a bankrupt or its reorganization or arrangement, or any
composition, readjustment, liquidation, dissolution or similar relief with
respect to it pursuant to any present or future federal or state bankruptcy or
similar law; or (C) the appointment by order of a court of competent
jurisdiction of a receiver, trustee or liquidator of the Premises or any part thereof
or of Borrower, Interest Owner or any guarantor or of substantially all of the
assets of Borrower, Interest Owner or any guarantor; or

 

25

 

(c)                     one
or more of the items set forth in paragraph 10(b) above occur which were
either not (i) voluntarily brought by Borrower, Interest Owner or any
guarantor or (ii) acquiesced in by Borrower, Interest Owner or any
guarantor, and which are not discharged or dismissed within 90 days after the
action, filing or appointment, as the case may be; or

 

With respect to the matters in (b) and (c) above
for an Interest Owner only, no Event of Default shall occur until an interested
party or Interest Owner asserts a claim or right against Borrower or the Premises
which delays or otherwise affects Lender’s rights, remedies, or interests
granted under the Loan Documents (whether or not such assertion is successful).

 

(d)                    with
respect to the matters not described in the other subparagraphs of this
paragraph 10, failure to duly observe or perform any covenant, condition
or agreement of the Borrower or any guarantor contained in this Mortgage, the
Loan Agreement, the Guaranty, the Note or the Assignment of Leases from
Borrower to Lender or in any other instrument or agreement which evidences or
secures the Loan (the “Loan Documents”), or in the Environmental
Indemnity, and such failure shall have continued for 30 days after Notice
specifying such failure is given by Lender to Borrower; or

 

If any failure to observe or perform under (d) above
shall be of such nature that it cannot be cured or remedied within 30 days,
Borrower shall be entitled to a reasonable period of time to cure or remedy
such failure (not to exceed 90 days following the giving of Notice), provided
Borrower commences the cure or remedy thereof within the 30 day period
following the giving of Notice and thereafter proceeds with diligence, as
determined by Lender, to complete such cure or remedy.

 

(e)                     the
failure of Borrower to duly observe or perform any of the covenants,
conditions and agreements of the Borrower contained in paragraph 2(f) of
this Mortgage; or

 

(f)                      any
representation when made by or on behalf of Borrower, Interest Owner or any
guarantor regarding the Premises, the making or delivery of any of the Loan
Documents or the Environmental Indemnity or in any material written information
provided by or on behalf of Borrower, Interest Owner or any guarantor in
connection with the Loan shall prove to be untrue or inaccurate in any material
respect; or

 

(g)                     the
failure of Borrower to give Notice to Lender within 90 days after the death of
any individual who is personally liable for any obligation under the Loan
Documents or the Environmental Indemnity, as Borrower, indemnitor or guarantor,
whether or not such individual had executed the Note or this Mortgage; or

 

26

 

(h)                    subject
to the provisions of paragraph 2(f), the failure of Borrower to provide Lender
with an assumption agreement in form and substance and executed by a
person(s) or entity(ies) acceptable to Lender in its sole discretion to assume
the obligations of any deceased individual who is personally liable for any
obligation under the Loan Documents or the Environmental Indemnity, as Borrower,
indemnitor or guarantor, whether or not such individual had executed the Note
or this Mortgage, and such failure shall have continued for 90 days after the
death of such individual; or

 

(i)                        the
failure of Borrower to remain a Single-Purpose Entity;

 

then, in each and every such case, the whole of said
principal sum hereby secured shall, at the option of the Lender and without
further notice to Borrower, become immediately due and payable together with
accrued interest thereon, a Make Whole Premium calculated in accordance with
the provisions of the Loan Documents and all other Indebtedness, and whether or
not Lender has exercised said option, interest shall accrue on the entire
principal balance and any interest or Make Whole Premium or other Indebtedness
then due, at the Default Rate until fully paid or if Lender has not exercised
said option, for the duration of any Event of Default.

 

11.                 Borrower
agrees that if Lender accelerates the whole or any part of the principal
sum hereby secured after the occurrence of an Event of Default, or applies any
proceeds pursuant to the provisions hereof, Borrower waives any right to prepay
the principal sum hereby secured in whole or in part without premium and
agrees to pay, as yield maintenance protection and not as a penalty, a “Make
Whole Premium”. However, in the event any proceeds from a casualty or
Taking of the Premises are applied to reduce the principal balance under the
Note, no Make Whole Premium shall be due so long as no Event of Default exists
at the time of such application.

 

12.                 Upon
the occurrence of any Event of Default, in addition to any other rights or
remedies provided in the Loan Documents, at law, in equity or otherwise, Lender
shall have the right to foreclose the lien hereof, and to the extent permitted
herein and by applicable law to sell the Premises by sale independent of the
foreclosure proceedings. In any suit to foreclose the lien hereof, and in any
sale of the Premises, there shall be allowed and included as additional
Indebtedness payable by Borrower to Lender and secured hereby all expenditures
and expenses which may be paid or incurred by or on behalf of Lender for
attorneys’ fees and costs, including attorneys’ fees and costs on appeal,
appraisers’ fees, expenditures for documentary and expert evidence,
stenographer’s charges, publication and advertising costs, survey costs,
environmental audits and costs (which may be estimated as to items to be
expended after the entry of any decree) of procuring all such abstracts of
title, title searches and examinations, title insurance policies, torrens
certificates and similar data and assurances with respect to title as Lender
deems reasonably necessary either to prosecute such suit or to consummate such
sale or to evidence to bidders at any sale

 

27

 

the true condition of the title to or the value of the
Premises. Further, Lender shall have the right, upon the occurrence of an Event
of Default, to exercise any or all of the remedies available to a secured party
under the Uniform Commercial Code as now or hereafter adopted in the State
of New Jersey.

 

13.                 The
proceeds of any foreclosure sale, or other sale of the Premises in accordance
with the terms hereof or as permitted by law, shall be distributed and applied
in the following order of priority: first, to the payment of all costs and
expenses incident to the foreclosure and/or sale proceedings, including all
items as are mentioned in any preceding or succeeding paragraph hereof; second,
to the payment of all other items which under the terms hereof constitute
secured Indebtedness in addition to that evidenced by the Note, with interest
thereon as herein provided; third, to the payment of all principal, accrued
interest remaining unpaid on the Note and Make Whole Premium; fourth, any
surplus to the Borrower or Borrower’s successors or assigns, as their rights may appear.

 

14.                 Following
the occurrence of an Event of Default, unless the same has been specifically
waived in writing, Borrower shall forthwith upon demand of Lender surrender to
Lender possession of the Premises, and Lender shall be entitled to take actual
possession of the Premises or any part thereof personally or by its agents
or attorneys, and Lender in its discretion may, with or without force and with
or without process of law, enter upon and take and maintain possession of all
or any part of the Premises together with all documents, books, records,
papers and accounts of the Borrower or the then owner of the Premises relating
thereto, and may exclude Borrower, its agents or assigns wholly therefrom,
and may as attorney-in-fact or agent of the Borrower, or in its own name
as Lender and under the powers herein granted:

 

(a)                    hold,
operate, maintain, repair, rebuild, replace, alter, improve, manage or control
the Premises as it deems judicious, insure and reinsure the same and any risks
related to Lender’s possession, operation and management thereof and receive
all Rents, either personally or by its agents, and with full power to use such
measures, legal or equitable, as in its discretion it deems proper or necessary
to enforce the payment or security of the Rents, including actions for the
recovery of Rent, actions in forcible detainer and actions in distress for
Rents, hereby granting full power and authority to exercise each and every of
the rights, privileges and powers herein granted at any and all times
hereafter, without notice to Borrower; and

 

(b)                    conduct
leasing activity pursuant to the provisions of the Assignment of Leases.

 

Lender shall not be obligated to perform or
discharge, nor does it hereby undertake to perform or discharge, any
obligation, duty or liability under any Lease. Except to the extent that the
same is caused solely by Lender’s gross negligence or willful misconduct,
should Lender incur any liability, loss or damage under any Leases, or

 

28

 

under or by reason of the Assignment of Leases, or in
the defense of my claims or demands whatsoever which may be asserted
against Lender by reason of any alleged obligations or undertakings on its part to
perform or discharge any of the terms, covenants or agreements in any
Lease, the amount thereof, including costs, expenses and reasonable attorneys’
fees and costs, including reasonable attorneys’ fees and costs on appeal, shall
be added to the Indebtedness and secured hereby.

 

15.                 Upon
the occurrence of an Event of Default, Lender in the exercise of the rights and
powers conferred upon it shall have the full power to use and apply the Rents,
less costs and expenses of collection to the payment of or on account of the
items listed in (a) – (c) below, at the election of Lender and in
such order as Lender may determine as follows:

 

(a)                    to
the payment of (i) the expenses of operating and maintaining the Premises,
including, but not limited to the cost of management, leasing (which shall
include reasonable compensation to Lender and its agent or agents if management
and/or leasing is delegated to an agent or agents), repairing, rebuilding,
replacing, altering and improving the Premises, (ii) premiums on insurance
as hereinabove authorized, (iii) taxes and special assessments now due or
which may hereafter become due on the Premises and (iv) expenses of
placing the Premises in such condition as will, in the sole judgment of Lender,
make it readily rentable;

 

(b)                    to
the payment of any principal, interest or any other Indebtedness secured hereby
or any deficiency which may result from any foreclosure sale;

 

(c)                     to
the payment of established claims for damages, if any, reasonable attorneys’
fees and costs and reasonable attorneys’ fees and costs on appeal.

 

The manner of the application of Rents, the
reasonableness of the costs and charges to which such Rents are applied and the
item or items which shall be credited thereby shall be within the sole and
unlimited discretion of Lender. To the extent that the costs and expenses in (a) and
(c) above exceed the amounts collected, the excess shall be added to the
Indebtedness and secured hereby.

 

16.                 Upon
the occurrence of any Event of Default, unless the same has been specifically
waived in writing, Lender may apply to any court having jurisdiction for
the appointment of a receiver of the Premises. Such appointment may be
made either before or after sale, without notice, without regard to the
solvency or insolvency of Borrower at the time of application for such receiver
and without regard to the then value of the Premises or the adequacy of Lender’s
security. Lender may be appointed as such receiver. The receiver shall
have the power to collect the Rents during the pendency of any foreclosure
proceeding and, in case of a sale, during the full statutory period of
redemption, if any, as well as during any further times when Borrower, except
for the intervention of such receiver, would be entitled to collect

 

29

 

such Rents. Borrower hereby consents to the foregoing
and waives any right to object to such appointment. In addition, the receiver
shall have all other powers which shall be necessary or are usual in such cases
for the protection, possession, control, management and operation of the
Premises during the whole of said period. The court from time to time may authorize
the receiver to apply the net income in its possession at Lender’s election and
in such order as Lender may determine in payment in full or in part of
those items listed in paragraph 15.

 

17.    (a)                         Borrower agrees that all
reasonable costs, charges and expenses, including but not limited to,
reasonable attorneys’ fees and costs, incurred or expended by Lender arising
out of or in connection with any action, proceeding or hearing, legal,
equitable or quasi-legal, including the preparation therefor and any appeal
therefrom, in any way affecting or pertaining to the Loan Documents, the
Environmental Indemnity or the Premises, shall be promptly paid by Borrower.
Such expenses shall include but not be limited to reasonable expenses
(including the reasonable fees and expenses of legal counsel for Lender)
incurred in connection with (a) the preservation and enforcement of Lender’s
liens and security interests under this Mortgage, (b) the protection,
exercise or enforcement of Lender’s rights with respect to the Premises
including (without limitation) Lender’s rights to (i) collect or take
possession of the Premises and the proceeds thereof, (ii) hold the
Premises, (iii) prepare the Premises for sale or other disposition and (iv) sell
or otherwise dispose of the Premises, and (c) the assertion, protection,
exercise or enforcement of Lender’s rights in any proceeding under the United
States Bankruptcy Code, including (without limitation) the preparation, filing
and prosecution of (i) proofs of claim, (ii) motions for relief from
the automatic stay, (iii) motions for adequate protection, and (iv) complaints,
answers and other pleadings in adversary proceedings by or against Lender or
relating in any way to the Premises. All such sums not promptly paid by
Borrower shall be added to the Indebtedness secured hereby and shall bear
interest at the Default Rate from the date of such advance and shall be due and
payable on demand.

 

(b)                    Borrower
hereby agrees that upon the occurrence of an Event of Default and the
acceleration of the principal sum secured hereby pursuant to this Mortgage, to
the full extent that such rights can be lawfully waived, Borrower hereby waives
and agrees not to insist upon, plead, or in any manner take advantage of, any
notice of acceleration, any stay, extension, exemption, homestead, marshaling
or moratorium law or any law providing for the valuation or appraisement of all
or any part of the Premises prior to any sale or sales thereof under any
provision of this Mortgage or before or after any decree, judgment or order of
any court or confirmation thereof, or claim or exercise any right to redeem all
or any part of the Premises so sold and hereby expressly waives to the
full extent permitted by applicable law on behalf of itself and each and every
person or entity acquiring any right, title or interest in or to all or any part of
the Premises, all benefit and advantage of any such laws which would otherwise
be available to Borrower or

 

30

 

any such person or entity, and agrees that neither Borrower
nor any such person or entity will invoke or utilize any such law to otherwise
hinder, delay or impede the exercise of any remedy granted or delegated to
Lender herein but will permit the exercise of such remedy as though any such
laws had not been enacted. Borrower hereby further expressly waives to the full
extent permitted by applicable law on behalf of itself and each and every
person or entity acquiring any right, title or interest in or to all or any part of
the Premises any and all rights of redemption from any sale or any order or
decree of foreclosure obtained pursuant to provisions of this Mortgage. To the
extent permitted by law, Borrower hereby waives and releases all procedural
errors, defects and imperfections in any proceedings instituted by Lender under
the terms of this Mortgage, the Note and the other Loan Documents.

 

18.                 In
accordance with and subject to the terms and conditions of the Assignment of
Leases, Borrower hereby assigns to Lender directly and absolutely, and not
merely collaterally, the interest of Borrower as lessor under the Leases of the
Premises, and the Rents payable under any Lease and/or with respect to the use
of the Premises, or portion thereof, including any oil, gas or mineral lease,
or any installments of money payable pursuant to any agreement or any sale of
the Premises or any part thereof, subject only to a license, if any,
granted by Lender to Borrower with respect thereto prior to the occurrence of
an Event of Default. Borrower has executed and delivered the Assignment of
Leases which grants to Lender specific rights and remedies in respect of said
Leases and governs the collection of Rents thereunder and from the use of the
Premises, and such rights and remedies so granted shall be cumulative of those
granted herein.

 

The collection of such Rents and the application
thereof as aforesaid shall not cure or waive any Event of Default or notice of
default hereunder or invalidate any act done pursuant to such notice, except to
the extent any such Event of Default is fully cured. Failure or discontinuance
of Lender at any time, or from time to time, to collect any such moneys shall
not impair in any manner the subsequent enforcement by Lender of the right,
power and authority herein conferred on Lender. Nothing contained herein,
including the exercise of any right, power or authority herein granted to
Lender, shall be, or be construed to be, an affirmation by Lender of any
tenancy, Lease or option, or an assumption of liability under, or the
subordination of the lien or charge of this Mortgage to any such tenancy, Lease
or option. Borrower hereby agrees that, in the event Lender exercises its
rights as provided for in this paragraph or in the Assignment of Leases,
Borrower waives any right to compensation for the use of Borrower’s furniture,
furnishings or equipment in the Premises for the period such assignment of
rents or receivership is in effect, it being understood that the Rents derived
from the use of any such items shall be applied to Borrower’s obligations hereunder
as above provided.

 

19.                 All
rights and remedies granted to Lender in the Loan Documents shall be in
addition to and not in limitation of any rights and remedies to which it is
entitled in equity, at

 

31

 

law or by statute, and the invalidity of any right or
remedy herein provided by reason of its conflict with applicable law or statute
shall not affect any other valid right or remedy afforded to Lender. No waiver
of any default or Event of Default under any of the Loan Documents shall at any
time thereafter be held to be a waiver of any rights of the Lender hereunder,
nor shall any waiver of a prior Event of Default or default operate to waive
any subsequent Event of Default or default. All remedies provided for in the
Loan Documents are cumulative and may, at the election of Lender, be exercised
alternatively, successively or concurrently. No act of Lender shall be
construed as an election to proceed under any one provision herein to the
exclusion of any other provision or to proceed against one portion of the
Premises to the exclusion of any other portion. Time is of the essence under
this Mortgage and the Loan Documents.

 

20.                 By
accepting payment of any sum secured hereby after its due date, Lender does not
waive its right either to require prompt payment when due of all other sums or
installments so secured or to declare a default for failure to pay such other
sums or installments.

 

21.                 The
usury provisions of paragraph 6 of the Note and the limitation of recourse
liability provisions of paragraph 9 of the Note are fully incorporated herein
by reference as if the same were specifically stated here.

 

22.                 In
the event one or more provisions of the Loan Documents shall be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other provision hereof, and the Loan
Documents shall be construed as if any such provision had never been contained
herein.

 

23.                 If
the payment of the Indebtedness secured hereby or of any part thereof
shall be extended or varied, or if any part of the security be released,
all persons now or at any time hereafter liable therefor, or interested in said
Premises, shall be held to assent to such extension, variation or release, and
their liability and the lien and all provisions hereof shall continue in full
force, the right of recourse against all such persons being expressly reserved
by Lender notwithstanding such variation or release.

 

24.                 Upon
payment in full of the principal sum, interest and other Indebtedness secured
by the Loan Documents, these presents shall be null and void, and Lender shall
release this Mortgage and the lien hereof by proper instrument executed in
recordable form.

 

25.    (a)                         Borrower hereby grants to
Lender and its respective agents, attorneys, employees, consultants,
contractors and assigns an irrevocable license and authorization to enter upon
and inspect the Premises and all facilities located thereon at reasonable
times, subject to the inspection rights provisions afforded to Borrower under
the Leases. Lender shall make reasonable efforts to ensure that the operations
of tenants are not disrupted.

 

32

 

(b)                    In
connection with any sale or conveyance of this Mortgage, Borrower grants to
Lender and its respective agents, attorneys, employees, consultants,
contractors and assigns an irrevocable license and authorization to conduct, at
Lender’s expense, a Phase I environmental audit of the Premises, subject to the
inspection rights provisions afforded to Borrower under the Leases.

 

(c)                     In
the event there has been an Event of Default or in the event Lender has formed
a reasonable belief, based on its inspection of the Premises or other factors
known to it, that Hazardous Materials may be present on the Premises, then
Borrower grants to Lender and its respective agents, attorneys, employees,
consultants, contractors and assigns an irrevocable license and authorization
to conduct, at Borrower’s expense using EMG Corp. or the firm of Borrower’s
choice, subject to Lender’s reasonable approval, environmental tests of the
Premises, including without limitation, a Phase I environmental audit,
subsurface testing, soil and ground water testing, and other tests which may physically
invade the Premises or facilities (the “Tests”). The scope of the Tests
shall be such as Lender, in its sole discretion, determines is necessary to (i) investigate
the condition of the Premises, (ii) protect the security interests created
under this Mortgage, or (iii) determine compliance with Environmental
Laws, the provisions of the Loan Documents and the Environmental Indemnity and
other matters relating thereto. Lender shall make reasonable efforts to ensure
that the operations of the tenants are not disrupted.

 

(d)                    Provided
no Event of Default has occurred, Lender will provide Borrower with reasonable
notice of Lender’s intent to enter, inspect and conduct the Tests provided for
in this paragraph. In addition, Lender shall conduct such inspections and Tests
during normal business hours and use reasonable efforts to minimize disruption
of the lessees’ business operations.

 

The foregoing licenses and authorizations are intended
to be a means of protection of Lender’s security interest in the Premises and
not as participation in the management of the Premises.

 

26.                 Within
15 days after any written request by either party to this Mortgage, the
requested party shall certify, by a written statement duly acknowledged, the
amount of principal, interest and other Indebtedness then owing on the Note,
the terms of payment, Maturity Date and the date to which interest has been
paid. Borrower shall further certify whether any defaults, offsets or defenses
exist against the Indebtedness secured hereby. Borrower shall also furnish to
Lender, within 30 days of its request therefor, tenant estoppel letters from
such tenants of the Premises as Lender may reasonably require; which
Lender shall not request more than one (1) time per annum, nor more than one
(1) time prior to the date of the Securitization Transaction.

 

27.                 Each
notice, consent, request, report or other communication under this Mortgage or
any other Loan Document (each a “Notice”) which any party hereto may desire
or be

 

33

 

required to give to the other shall be deemed to be an
adequate and sufficient notice if given in writing and service is made by
either (i) registered or certified mail, postage prepaid, in which case
notice shall be deemed to have been received three (3) business days
following deposit to U.S. mail; or (ii) nationally recognized overnight
air courier, next day delivery, prepaid, in which case such notice shall be
deemed to have been received one (1) business day following delivery to
such nationally recognized overnight air courier. All Notices shall be
addressed to Borrower at its address given on the first page hereof or to
Lender at c/o Principal Real Estate Investors, LLC, 801 Grand Avenue, Des
Moines, Iowa 50392-1450, Attn: Commercial Real Estate Servicing, Loan No. 755086,
or to such other place as either party may by written notice to the other
hereafter designate as a place for service of notice. Borrower shall not be
permitted to designate more than one place for service of Notice concurrently.

 

28.                 This
Mortgage and all provisions hereof shall inure to the benefit of the heirs,
successors and assigns of Lender and shall bind the heirs and permitted
successors and assigns of Borrower.

 

29.                 Borrower
has had the opportunity to fully negotiate the terms hereof and modify the
draftsmanship of the Loan Documents and the Environmental Indemnity. Therefore,
the terms of the Loan Documents and the Environmental Indemnity shall be
construed and interpreted without any presumption, inference, or rule requiring
construction or interpretation of any provision of the Loan Documents and the
Environmental Indemnity against the interest of the party causing the Loan
Documents and the Environmental Indemnity or any portion of it to be drafted.
Borrower is entering into the Loan Documents and the Environmental Indemnity
freely and voluntarily without any duress, economic or otherwise.

 

30.                 This
Mortgage shall be governed by, and construed in accordance with the laws of the
state of New Jersey, without regard to its conflicts of law principles.

 

31.                 As
used herein, the term “Default Rate” means a rate equal to the lesser of
(i) four percent (4%) per annum above the then applicable interest rate
payable under the Note or (ii) the maximum rate allowed by applicable law.
Borrower acknowledges that the Default Rate is not a penalty, but rather is a
rate of interest negotiated by the parties to compensate Lender for the
increased credit risk to which Lender is subjected by reason of the occurrence
of one or more Events of Default.

 

32.                 BORROWER
AND LENDER EACH KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE, TO THE EXTENT
PERMITTED BY LAW, TRIAL BY JURY IN ANY ACTIONS BROUGHT BY BORROWER OR LENDER IN
CONNECTION WITH THIS MORTGAGE, ANY OF THE LOAN DOCUMENTS, THE INDEBTEDNESS
SECURED HEREBY, OR ANY OTHER STATEMENTS OR ACTIONS OF LENDER.

 

34

 

33.                 This
Mortgage and the Indebtedness secured hereby is for the sole purpose of
conducting or acquiring a lawful business, professional or commercial activity
or for the acquisition or management of real or personal property as a
commercial investment, and all proceeds of such Indebtedness shall be used for
said business or commercial investment purpose. Such proceeds will not be used
for the purchase of any security within the meaning of the Securities Exchange
Act of 1934, as amended, or any regulation issued pursuant thereto, including
without limitation, Regulations U, T and X of the Board of Governors of the Federal
Reserve System. This is not a purchase money mortgage where a seller is
providing financing to a buyer for the payment of all or any portion of the
purchase price, and the Premises secured hereby is not a residence or homestead
or used for mining, grazing, agriculture, timber or farming purposes.

 

34.                 Unless
Lender shall otherwise direct in writing, Borrower shall appear in and defend
all actions or proceedings purporting to affect the security hereunder, or any
right or power of the Lender, excluding any Federal regulatory proceedings
against Lender that are not instituted because of any act or omission by
Borrower, any Interest Owner or which result from the Premises. The Lender
shall have the right to appear in such actions or proceedings. Borrower shall
save Lender harmless from all reasonable costs and expenses, including but not
limited to, reasonable attorneys’ fees and costs, and costs of a title search,
continuation of abstract and preparation of survey incurred by reason of any
action, suit, proceeding, hearing, motion or application before any court or
administrative body in and to which Lender may be or become a party by
reason hereof, excluding any Federal regulatory proceedings against Lender that
are not instituted because of any act or omission by Borrower, any Interest
Owner or which result from the Premises. Such proceedings shall include but not
be limited to condemnation, bankruptcy, probate and administration proceedings,
as well as any other action, suit, proceeding, right, motion or application
wherein proof of claim is by law required to be filed or in which it becomes
necessary to defend or uphold the terms of this Mortgage or the Loan Documents
or otherwise purporting to affect the security hereof or the rights or powers
of Lender. All money paid or expended by Lender in that regard, together with
interest thereon from date of such payment at the Default Rate shall be
additional Indebtedness secured hereby and shall be immediately due and payable
by Borrower without notice.

 

35.                 Upon
the occurrence of an Event of Default, unless the same has been specifically
waived in writing, all Rents collected or received by Borrower shall be
accepted and held for Lender in trust and shall not be commingled with the
funds and property of Borrower, but shall be promptly paid over to Lender.

 

36.                 If
more than one, all obligations and agreements of Borrower are joint and
several.

 

37.                 This
Mortgage may be executed in counterparts, each of which shall be deemed an
original; and such counterparts when taken together shall constitute but one
agreement.

 

35

 

38.                 Borrower
and Lender may agree to change the interest rate, Maturity Date, or other
term or terms of this Mortgage, or any of the Loan Documents, or of the
Indebtedness secured hereby. Any such agreement shall be in writing, duly
executed by both Borrower and Lender. In the event that any such agreement
shall occur, it shall, to the extent permitted by law, be deemed a “modification”
as defined in N.J.S.A. §46:9-8.1 et  seq., and this
Mortgage shall be subject to, and Lender shall be the beneficiary of, the
mortgage lien priority provisions of N.J.S.A. §46:9-8.2. Further, all
advances made under the Loan Documents, including any future advances, whether
or not entitled to priority under N.J.S.A. §46:9-8.2, shall be deemed to
be obligatory advances when made, shall be secured hereby, and shall, to the
maximum extent possible under the law, relate back as to lien priority to the
date when this Mortgage was left for recording with the Camden County recorder
of deeds. By placing or accepting any lien or encumbrance against any or all of
the Premises, the holder thereof shall be deemed to have agreed to the maximum
extent possible under the law that its lien or encumbrance shall be subject and
subordinate in lien priority to this Mortgage and to any subsequent advances
made under the Loan Documents, to all accrued and unpaid interest and to all
other sums secured hereby.

 

IN WITNESS WHEREOF, Borrower has caused this Mortgage
and Security Agreement to be duly executed and delivered as of the date first
above written.

 

REMAINDER OF PAGE INTENTIONALLY BLANK 

(Signatures on next page)

 

36

 

SIGNATURE PAGE OF BORROWER TO 

MORTGAGE AND SECURITY AGREEMENT

 

 

	
   

  	
   

  	
  INLAND AMERICAN SICKLERVILLE, L.L.C., 

  a Delaware limited liability company

  
	
  

  	
   

  	
  

  By:

  	
  

  Inland American Ceruzzi
  Sicklerville Member,

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

  Member

  
	
   

  	
   

  	
   

  	
  

  By:

  	
  

  Inland American Sicklerville Member II,

  L.L.C., a Delaware limited liability

  company, Manager

  
	
  Attest:

  	
   

  	
   

  	
   

  	
  

  By:

  	
  

  Inland American Real
  Estate Trust,

  Inc., a Maryland corporation, Sole

  Member

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/
  Valerie Medina

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Valerie
  Medina

  
	
  /s/ Ruth E. Winter

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  Assistant
  Secretary

  
	
  Ruth E. Winter

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
									

 

37

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