Document:

Exhibit

EXHIBIT 10.8

Jefferson at Perimeter

INTEREST RATE CAP RESERVE AND SECURITY AGREEMENT
This INTEREST RATE CAP RESERVE AND SECURITY AGREEMENT (this “Agreement”), dated as of June 11, 2018, is by and between SIR JEFFERSON, LLC, a Delaware limited liability company, (“Borrower”), and FANNIE MAE, a corporation duly organized under the Federal National Mortgage Association Charter Act, as amended, 12 U.S.C. §1716 et seq. and duly organized and existing under the laws of the United States (“Lender”).
RECITALS:
A.Pursuant to that certain Multifamily Loan and Security Agreement dated as of October 31, 2017, executed by and between BRE JEFFERSON ST. ANDREWS OWNER LLC, a Delaware limited liability company (“Original Borrower”) and JONES LANG LASALLE MULTIFAMILY, LLC, a Delaware limited liability company (“Prior Lender”) (as amended, restated, replaced, supplemented or otherwise modified from time to time, the “Loan Agreement”), Prior Lender made a loan to Original Borrower in the original principal amount of Sixty-Five Million and 00/100 Dollars ($65,000,000.00) (the “Mortgage Loan”), as evidenced by, among other things, that certain Multifamily Note dated as of October 31, 2017, executed by Original Borrower and made payable to Prior Lender in the amount of the Mortgage Loan (as amended, restated, replaced, supplemented or otherwise modified from time to time, the “Note”), which Note has been assigned to Fannie Mae.  The current servicer of the Mortgage Loan is Prior Lender (“Loan Servicer”).
B.In addition to the Loan Agreement, the Mortgage Loan and the Note are also secured by a certain Multifamily Mortgage, Deed of Trust or Deed to Secure Debt (as amended, restated, replaced, supplemented or otherwise modified from time to time, the “Security Instrument”), dated as of October 31, 2017, granting a lien on certain real property located in Atlanta (DeKalb County), Georgia (the “Mortgaged Property”).
C.Pursuant to the Assumption and Release Agreement dated as of the date hereof, Borrower has agreed to ratify and assume all of Original Borrower’s rights, obligations, and liabilities created or arising under the Loan Documents, as those rights, obligations and liabilities may have been modified in writing by the Amendment to Loan Agreement executed as of the date hereof or otherwise (“Assumption”).
D.Lender has required, and Borrower has agreed to acquire, maintain and pledge to Lender an interest rate cap (the “Interest Rate Cap”), pursuant to one or more interest rate cap agreements, in order to provide additional support and collateral for Borrower’s obligations to Lender under the Loan Agreement and other Loan Documents (as defined in the Loan Agreement).
E.To the extent that the term of the initial Interest Rate Cap acquired by Borrower is less than the term of the Mortgage Loan, Borrower is required to make monthly deposits with Lender for the acquisition of a subsequent Interest Rate Cap, such deposits to be held in an escrow account by Lender pursuant to the terms of this Agreement.
F.Borrower and Lender are entering into this Agreement to (i) evidence Borrower’s obligation to maintain an Interest Rate Cap for the entire term of the Mortgage Loan, (ii) evidence Borrower’s obligation to make monthly deposits for the acquisition of a subsequent Interest Rate Cap (if applicable), and (iii) provide further security for Borrower’s obligations under the Loan Documents.

	
				
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NOW, THEREFORE, in consideration of the above and the mutual promises contained in this Agreement and for other valuable consideration, including Lender’s consent to the Assumption, the receipt and sufficiency of which are acknowledged, Borrower and Lender agree as follows:
ARTICLE 1 
DEFINITIONS; RULES OF CONSTRUCTION
Section 1.01    Recitals.
The recitals set forth above are incorporated herein by reference as if fully set forth in the body of this Agreement.
Section 1.02    Defined Terms.
Capitalized terms used and not specifically defined herein shall have the meanings given to such terms in the Loan Agreement.  Unless otherwise defined in this Agreement, terms used in this Agreement that are defined in the UCC shall have the meaning given those terms in the UCC. The following terms in this Agreement shall have the following meanings:
“Collateral” means the items listed in Section 4.01(a) through Section 4.01(k) of this Agreement.
“Collateral Liens” means any lien, security interest, option or other charge or encumbrance.
“Counterparty” means (a) an interest rate cap provider acceptable to Lender under the Interest Rate Cap Documents, or (b) a counterparty on any list of acceptable counterparties for interest rate caps of the type required by this Agreement maintained by Lender, as any such list may be modified by Lender from time to time.
“Event of Default” has the meaning set forth in Section 7.01 of this Agreement.
“Initial Interest Rate Cap” means the initial Interest Rate Cap purchased by Borrower with respect to the Mortgage Loan.
“Initial Interest Rate Cap Term” means the period in which the Initial Interest Rate Cap shall be in effect, beginning on or prior to the Effective Date and terminating not earlier than the first to occur of (a) the last day of the thirty-sixth (36th) full calendar month thereafter and (b) the Maturity Date.
“Interest Rate Cap” has the meaning set forth in Recital C of this Agreement.
“Interest Rate Cap Documents” means the rate cap agreements and related documentation in form and content acceptable to Lender.
“Interest Rate Cap Reserve Escrow” means all Monthly Deposits and all other funds held in the Interest Rate Cap Reserve Escrow Account.
“Interest Rate Cap Reserve Escrow Account” means an interest-bearing account which meets the standards for custodial accounts as required by Lender from time to time.

	
				
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“Monthly Deposit” means, with respect to the first twelve (12) months after the purchase of the Initial Interest Rate Cap, an amount equal to one-thirty-sixth (1/36) of one hundred percent (100%) of the cost, as reasonably estimated by Lender, to obtain any required Subsequent Interest Rate Cap.  Thereafter, the Monthly Deposit shall mean the amount determined by Lender in accordance with Section 3.02 of this Agreement.
“Payment Date” means the date by which the Counterparty requires payment of the Purchase Price.
“Payments” means any and all moneys payable to Borrower, from time to time, pursuant to the Interest Rate Cap Documents by the Counterparty, whether credited to the Interest Rate Cap Reserve Escrow Account, held in the course of payment or collection by Lender, or otherwise.
“Purchase Price” means the purchase price of the Subsequent Interest Rate Cap.
“Required Strike Rate” means Three and fifty hundreths percent (3.5%).
“Subsequent Interest Rate Cap” means a subsequent Interest Rate Cap required to be purchased and pledged to Lender pursuant to the terms of this Agreement.
“Subsequent Interest Rate Cap Term” means the period in which the Subsequent Interest Rate Cap shall be in effect, beginning on or prior to the termination date of the Interest Rate Cap then in effect and terminating not earlier than the first to occur of (a) the last day of the thirty-sixth (36th) full calendar month thereafter and (b) the Maturity Date.
“UCC” means the Uniform Commercial Code as adopted in the state in which Borrower is organized.
ARTICLE 2
TERMS OF INTEREST RATE CAP
Section 2.01    General Terms.
To protect against fluctuations in interest rates during the term of the Mortgage Loan, Borrower shall make arrangements for an Interest Rate Cap to be in place and maintained at all times with respect to the Mortgage Loan in accordance with the following terms and conditions:
(a)    Term.
Except as hereinafter permitted, the Initial Interest Rate Cap shall be in effect for the Initial Interest Rate Cap Term.  If the Initial Interest Rate Cap Term is less than the term of the Mortgage Loan, a Subsequent Interest Rate Cap shall be required.  Any Subsequent Interest Rate Cap shall be in effect for the Subsequent Interest Rate Cap Term.
(b)    Notional Amount.
The notional amount of the Initial Interest Rate Cap shall be equal to the original principal balance of the Mortgage Loan for the entire term of the Initial Interest Rate Cap.  The notional amount of any Subsequent Interest Rate Cap shall be equal to the outstanding principal balance of the Mortgage Loan at the time that any Subsequent Interest Rate Cap is to become effective.  Unless otherwise agreed by Lender, the notional amount of any Interest Rate Cap shall not amortize over its term.

	
				
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(c)    Strike Rate.
Each Initial and any Subsequent Interest Rate Cap shall have a strike rate equal to or less than the Required Strike Rate.
(d)    Interest Rate Cap Documents and Counterparty.
All Interest Rate Caps shall be evidenced, governed and secured on terms and conditions pursuant to Interest Rate Cap Documents between Borrower and the Counterparty.
Section 2.02    Payments Made under Interest Rate Cap.
The Interest Rate Cap Documents shall require the Counterparty to make all payments due under the Interest Rate Cap directly to Lender for so long as the Interest Rate Cap is subject to the pledge established hereunder.  Such payments will be paid over to Borrower only if (a) there is no Event of Default, and (b) Lender has received payment in full for all amounts due on the Mortgage Loan as required by the Loan Documents.
Section 2.03    Rights and Remedies under Interest Rate Cap Documents.
For so long as an Interest Rate Cap is pledged as collateral for the Mortgage Loan pursuant to the terms of this Agreement, Borrower shall not exercise any right or remedy under any Interest Rate Cap Documents without Lender’s prior written consent and shall exercise its rights and remedies under the Interest Rate Cap Documents as directed by Lender in writing.  Rights and remedies under the Interest Rate Cap Documents include, but are not limited to, any right to designate an “Early Termination Date” or otherwise terminate the Interest Rate Cap due to the occurrence of a “Termination Event,” an “Additional Termination Event” or an “Event of Default.”  All capitalized terms appearing in this Section 2.03 in quotation marks are used as defined in the Interest Rate Cap Documents.
Section 2.04    Termination of Interest Rate Cap.
Borrower shall not terminate, transfer or consent to any transfer of any existing Interest Rate Cap without Lender’s prior written consent; provided, however, that if, and at such time as any amounts due and owing on the Mortgage Loan as required by the Loan Documents are paid in full or if the Mortgage Loan is converted to a fixed rate of interest, Borrower shall have the right to terminate the existing Interest Rate Cap in accordance with Section 8.02 of this Agreement.  If an Interest Rate Cap unexpectedly and unavoidably terminates or terminates for any reason on a date other than its scheduled expiration date without the prior written consent of Lender, Borrower shall, within ten (10) Business Days of such termination, obtain a new Interest Rate Cap satisfying the requirements of this Agreement.
ARTICLE 3 
INTEREST RATE CAP RESERVE ESCROW ACCOUNT
Section 3.01    Obligation to Maintain Interest Rate Cap Reserve Escrow Account.
During any period in which an Interest Rate Cap with an original term of less than the remaining term of the Mortgage Loan is in effect, Borrower is required to make Monthly Deposits to be held in the Interest Rate Cap Reserve Escrow Account to provide a cash reserve for the purchase of a Subsequent Interest Rate Cap.  Borrower shall, with each monthly payment due on the Mortgage Loan, deposit with Lender the Monthly Deposit into the Interest Rate Cap Reserve Escrow Account.

	
				
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Section 3.02    Adjustment of Monthly Deposit.
At the end of each six (6) month period following the date of this Agreement, Lender shall estimate the cost of the Subsequent Interest Rate Cap and shall adjust the Monthly Deposit based on the then current estimate for purchase of the Subsequent Interest Rate Cap.  No adjustment shall be made to the Monthly Deposit if Lender determines that the current estimate of the cost of the Subsequent Interest Rate Cap remains the same or has decreased.  Borrower shall continue to make the Monthly Deposits at the level required for the most recent six (6) month period until Lender delivers written notice of a change in the amount of the Monthly Deposit.
Section 3.03    Terms of Interest Rate Cap Reserve Escrow Account.
Lender shall deposit the Monthly Deposits into the Interest Rate Cap Reserve Escrow Account.  Lender or a designated representative of Lender shall have the sole right to make withdrawals from the Interest Rate Cap Reserve Escrow Account.  All interest earned on or profits realized from amounts on deposit in the Interest Rate Cap Reserve Escrow Account shall be added to and become part of the Interest Rate Cap Reserve Escrow.  Lender shall not be responsible for any losses resulting from the investment of the Interest Rate Cap Reserve Escrow or for obtaining any specific level or percentage of earnings on such investment.  If applicable law requires and provided no Event of Default exists under any of the Loan Documents, Lender shall pay to Borrower the interest earned on the Interest Rate Cap Reserve Escrow on January 1 of each year.  Otherwise, all interest earnings shall remain in the Interest Rate Cap Reserve Escrow Account.
Section 3.04    Lender’s Duties Regarding the Interest Rate Cap Reserve Escrow Account.
Lender acknowledges that:
(a)    it will hold the Monthly Deposits and any investments in the Interest Rate Cap Reserve Escrow pursuant to the terms of this Agreement;
(b)    it will credit all Monthly Deposits and any investments in the Interest Rate Cap Reserve Escrow on its own books and records to the Interest Rate Cap Reserve Escrow Account, subject to the security interests created in this Agreement;
(c)    it will hold all Monthly Deposits for the credit of the Interest Rate Cap Reserve Escrow, subject to the security interest and the terms of this Agreement; and
(d)    it will keep accurate records regarding amounts on deposit in the Interest Rate Cap Reserve Escrow Account and any interest earned on or profits realized from amounts on deposit in the Interest Rate Cap Reserve Escrow Account.
Section 3.05    Irrevocable Deposits in Escrow.
All deposits into the Interest Rate Cap Reserve Escrow Account constitute irrevocable payments in escrow solely for use as described in this Agreement.  Borrower shall not have any control over the use of, or any right to withdraw, any moneys from the Interest Rate Cap Reserve Escrow Account or any proceeds thereof except as provided in Section 3.07 of this Agreement, nor shall Borrower have any right, title or interest in the Interest Rate Cap Reserve Escrow Account, other than Borrower’s right to receive interest pursuant to Section 3.03 above.

	
				
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Section 3.06    Request for Disbursement.
At least ten (10) Business Days prior to the date on which the Initial Interest Rate Cap is to expire, Borrower shall be required to purchase the Subsequent Interest Rate Cap on terms and conditions satisfactory to Lender.  In such event, and provided that funds are available in the Interest Rate Cap Reserve Escrow Account, Borrower shall request a withdrawal from the Interest Rate Cap Reserve Escrow Account to acquire the Subsequent Interest Rate Cap.  Each written request for disbursement from the Interest Rate Cap Reserve Escrow Account shall specify (a) the Purchase Price, (b) the name, address, contact name, telephone number and wiring instructions of the Counterparty, (c) the Payment Date, and (d) such other information as Lender may require.
Section 3.07    Disbursement for Purchase of Subsequent Interest Rate Cap.
Upon receipt by Lender of a written request from Borrower in accordance with Section 3.06 above, and the determination by Lender that all applicable terms and conditions of this Agreement have been satisfied, Lender shall disburse to the Counterparty of the Subsequent Interest Rate Cap, an amount from the Interest Rate Cap Reserve Escrow Account equal to the lesser of (a) the Purchase Price, or (b) the amount then on deposit in the Interest Rate Cap Reserve Escrow Account.  In no event shall Lender be obligated to disburse funds from the Interest Rate Cap Reserve Escrow Account if an Event of Default has occurred and is continuing.
Section 3.08    Remaining Balance After Payment of Purchase Price.
Provided that Borrower has no obligation to purchase additional Subsequent Interest Rate Caps under the terms of this Agreement, any balance remaining in the Interest Rate Cap Reserve Escrow Account after payment of the Purchase Price shall be delivered to Borrower on or promptly following the Payment Date.  Borrower’s obligation to make Monthly Deposits hereunder shall cease and terminate upon the earlier of (a) purchase of a Subsequent Interest Rate Cap with a term of at least the entire remaining term of the Mortgage Loan, (b) conversion of the Mortgage Loan to a fixed rate of interest, and (c) payment in full of the Mortgage Loan.
ARTICLE 4 
SECURITY INTEREST IN COLLATERAL; FURTHER ASSURANCES
Section 4.01    Security Interest in Collateral.
As security for the Indebtedness, Borrower hereby grants to Lender, its successors and assigns, a lien and continuing security interest in all of Borrower’s right, title and interest in and to the following Collateral whether now owned or hereafter acquired:
(a)    the Interest Rate Cap and the Interest Rate Cap Documents representing the Initial Interest Rate Cap and any Subsequent Interest Rate Cap;
(b)    any and all Payments;
(c)    any residual right, title or interest Borrower may have in the Interest Rate Cap Reserve Escrow Account (to the extent required by this Agreement);
(d)    all Monthly Deposits, whether credited to the Interest Rate Cap Reserve Escrow Account, held in the course of payment or collection by Lender, or otherwise;
(e)    all interest earned and profits realized on funds in the Interest Rate Cap Reserve Escrow Account;

	
				
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(f)    all rights, liens and security interests or guarantees now existing or hereafter granted by the Counterparty or any other person to secure or guaranty payment of the Payments due pursuant to the Interest Rate Cap Documents;
(g)    all cash, funds, investments, securities, accounts, general intangibles and all other property held from time to time in the Interest Rate Cap Reserve Escrow Account and all certificates and instruments representing or evidencing any of the foregoing;
(h)    all rights of Borrower under any of the foregoing, including all rights of Borrower to the Payments, contract rights and general intangibles now existing or hereafter arising with respect to any or all of the foregoing;
(i)    all documents, writings, books, files, records and other documents arising from or relating to any of the foregoing, whether now existing or hereafter arising;
(j)    all extensions, renewals and replacements of the foregoing; and
(k)    all cash and non‐cash proceeds and products of any of the foregoing, including, without limitation, interest, dividends, cash, instruments, proceeds of any insurance, and other property from time to time received, receivable or otherwise distributed or distributable in respect of or in exchange for any or all of the foregoing.
TO HAVE AND TO HOLD the Collateral, together with all right, title, interest, powers, privileges and preferences pertaining or incidental thereto, unto Lender, its successors and assigns, forever, subject, however, to the terms, covenants and conditions herein set forth.  Borrower hereby authorizes Lender to file financing statements, continuation statements and financing statement amendments in such form as Lender may require to perfect or continue the perfection of this security interest in the Collateral and Borrower agrees, if Lender so requests, to execute and deliver to Lender such financing statements, continuation statements and amendments.  Borrower shall pay all filing costs and all costs and expenses of any record searches for financing statements that Lender may require.
Section 4.02    Further Assurances.
At any time and from time to time, at the expense of Borrower, Borrower shall promptly give, execute, deliver, file and record any notice, statement, instrument, document, agreement or other paper and do such other acts and things that may be necessary, or that Lender may request, in order to perfect, continue and protect any security interest granted or purported to be granted by this Agreement or to enable Lender to exercise and enforce its rights and remedies under this Agreement.
Section 4.03    Competing Security Arrangements.
Borrower shall not execute, file, permit to be filed or suffer to remain on file in any jurisdiction any security agreement, financing statement or like agreement or instrument with respect to the Collateral, or any part of the Collateral, naming anyone other than Lender as the secured party.  Borrower shall not sell, exchange or transfer or otherwise dispose of any of the Collateral, or any interest in the Collateral, other than any security interest or other lien in favor of Lender.

	
				
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Section 4.04    No Change.
Borrower will not voluntarily or involuntarily change its principal place of business, chief executive office, name or identity, without at least thirty (30) days prior written notice to Lender, except in the event of a change in principal place of business or chief executive office necessitated by fire, flood or other calamity, in which case such notice shall be provided as soon as practicable.
Section 4.05    Defense of Collateral.
Borrower will defend the Collateral against all claims and demands of all persons at any time claiming the same or any interest in the Collateral.
ARTICLE 5 
DELIVERY OF INTEREST RATE CAP DOCUMENTS
Section 5.01    Acquisition of Interest Rate Cap; Delivery of Interest Rate Cap Documents.
Borrower has, on or before the date of this Agreement, executed and delivered the Interest Rate Cap Documents to the Counterparty and has delivered to Lender fully executed originals of such Interest Rate Cap Documents.  True, complete and correct copies of the Interest Rate Cap Documents and all amendments thereto, fully executed by all parties, are attached as Exhibit A hereto.  Borrower hereby represents and warrants to Lender that there is no additional security for or any other arrangements or agreements relating to the Interest Rate Cap Documents and that the Counterparty has consented to Borrower’s pledge of its rights and interests in the Interest Rate Cap to Lender as security for the Mortgage Loan.
Section 5.02    Obligations Remain Absolute.
Nothing contained herein shall relieve Borrower of its primary obligation to pay all amounts due in respect of its obligations on the Mortgage Loan as required by the Loan Documents.
Section 5.03    Subsequent Interest Rate Caps.
Borrower agrees to execute and deliver to Lender a Supplemental Agreement substantially in the form of the attached Exhibit B attached hereto on each occasion on which Borrower acquires a Subsequent Interest Rate Cap.  Borrower shall, on or before the date any Subsequent Interest Rate Cap is to become Collateral under this Agreement, execute and deliver the Interest Rate Cap Documents representing such Subsequent Interest Rate Cap to the Counterparty and deliver to Lender fully executed originals of such Interest Rate Cap Documents to be held under this Agreement as a part of the Collateral.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES
Section 6.01    Representations and Warranties of Borrower.
Borrower represents and warrants to Lender that:
(a)    Borrower has paid to the Counterparty the entire cost of the Initial Interest Rate Cap;
(b)    the individuals who are signing and delivering this Agreement on behalf of Borrower have been duly authorized to do so in accordance with the documents and instruments pursuant to which Borrower is organized and which govern the conduct of Borrower’s business;

	
				
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(c)    no consent of any other person or entity and no authorization, approval, or other action by, and no notice to or filing with, any governmental authority or regulatory body is required or will be required (1) for the pledge by Borrower of the Collateral pursuant to this Agreement or any Supplemental Agreement or for the execution, delivery or performance of this Agreement or any Supplemental Agreement by Borrower (other than the consent of the Counterparty where such consent has been obtained), (2) for the perfection or maintenance of the security interest created hereby or by any Supplemental Agreement (including the first priority nature of such security interest) other than the filing of any financing statement as may be required by the UCC, or (3) for the execution, delivery or performance of this Agreement by Borrower;
(d)    there are no conditions precedent to the effectiveness of this Agreement that have not been satisfied or waived;
(e)    neither the execution nor delivery of this Agreement or any Supplemental Agreement nor the performance by Borrower of its obligations under this Agreement or any Supplemental Agreement, nor the consummation of the transactions contemplated by this Agreement or any Supplemental Agreement, will (1) conflict with any provision of the organizational documents of Borrower, (2) conflict with, result in a breach of, or constitute a default (or an event which would, with the passage of time or the giving of notice or both, constitute a default) under, or give rise to a right to terminate, amend, modify, abandon or accelerate, any contract, agreement, promissory note, lease, indenture, instrument or license to which Borrower is a party or by which Borrower’s assets or properties may be bound or affected, (3) violate or conflict with any federal, state or local law, statute, ordinance, rule, regulation, order, judgment, decree or arbitration award which is either applicable to, binding upon or enforceable against Borrower, (4) result in or require the creation or imposition of any Collateral Liens upon or with respect to the Collateral, other than Collateral Liens in favor of Lender, (5) violate any legally protected right of any Person or give to any Person a right or claim against Borrower, or (6) require the consent, approval, order or authorization of, or the registration, declaration or filing (except to the extent that the filing of financing statements may be applicable) with, any federal, state or local government entity;
(f)    Borrower is and shall be the sole legal and beneficial owner of, and has and will have good and marketable title to (and has full right and authority to pledge and assign), the Collateral, free and clear of all Collateral Liens (other than in favor of Lender), all fiduciary obligations of any kind and any adverse claim of title thereto and the Collateral is not subject to any offset, right of redemption, defense or counterclaim of a third party.  There is no additional security for or any other arrangements or agreements relating to the Interest Rate Cap Documents, except as may have been disclosed to Lender in writing;
(g)    the security interest of Lender in the Collateral is, or when it attaches shall be, a first priority and perfected security interest.  No financing statement covering the Collateral, or any part of the Collateral (other than any financing statement naming only Lender as the secured party), is outstanding or is on file in any public office;
(h)    Borrower is qualified to transact business and is in good standing in the state in which it is formed or organized, the Property Jurisdiction and in each other jurisdiction that qualification or standing is required according to applicable law to conduct its business with respect to the Mortgaged Property and where the failure to be so qualified would adversely affect Borrower’s operation of the Mortgaged Property or the validity, enforceability or the ability of Borrower to perform its obligations under this Agreement or any other Loan Document; and

	
				
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(i)    Borrower has not commenced (within the meaning of any Insolvency Laws) a voluntary case, consented to the entry of an order for relief against it in an involuntary case, or consented to the appointment of a receiver or custodian of it or for any part of its property, nor has a court of competent jurisdiction entered an order or decree under any Insolvency Law that is for relief against it in an involuntary case or appointed a receiver or custodian for Borrower or any part of its property.
ARTICLE 7 
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
Section 7.01    Event of Default.
The occurrence of any one or more of the following events shall constitute an “Event of Default” under this Agreement:
(a)    the failure by Borrower to observe and perform any duty, obligation or covenant required to be observed or performed by this Agreement or any Supplemental Agreement subject to any applicable notice and cure rights provided in this Agreement, any Supplemental Agreement, or the Loan Agreement;
(b)    any representation or warranty on the part of Borrower contained in this Agreement or repeated and reaffirmed in this Agreement or any Supplemental Agreement proves to be false, inaccurate, or misleading in any material respect when made or deemed made; and
(c)    the occurrence of an Event of Default under any Loan Document.
Section 7.02    Remedies on Default.
If any Event of Default under this Agreement has occurred and is continuing:
(a)    At the direction of Lender, Borrower shall deliver all Collateral to Lender or its designee;
(b)    Lender may, without further notice, exercise all rights, privileges or options pertaining to the Collateral as if Lender were the absolute owner of such Collateral, upon such terms and conditions as Lender may determine, all without liability except to account for property actually received by Lender, and Lender shall have no duty to exercise any of those rights, privileges or options and shall not be responsible for any failure to do so or delay in so doing; and
(c)    Lender may, subject to the terms of the Interest Rate Cap Documents, exercise in respect of the Collateral, in addition to other rights and remedies provided for in this Agreement or otherwise available to it, all of the rights and remedies of a secured party under the UCC and also may, without notice except as specified below, sell the Collateral at public or private sale, at any of the offices of Lender or elsewhere, for cash, on credit or for future delivery, and upon such other terms as may be commercially reasonable.  Borrower agrees that, to the extent notice of sale shall be required by applicable law, at least ten (10) days prior notice to Borrower of the time and place of any public sale or the time after which any private sale is to be made shall constitute reasonable notification.  Lender shall not be obligated to make any sale of Collateral regardless of notice of sale having been given.  Lender may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned.  In case of any sale by Lender of any of the Collateral, the Collateral so sold may be retained by Lender until the selling price is paid by the purchaser, but Lender shall not incur any liability in case of failure of the purchaser to take up and 

	
				
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pay for the Collateral so sold.  In case of any such failure, such Collateral so sold may be again similarly sold.
The foregoing rights and remedies (1) shall be cumulative and concurrent, (2) may be pursued separately, successively or concurrently against Borrower and any other party obligated for the Indebtedness, or against the Collateral, or any other security for the Indebtedness, at the sole discretion of Lender, (3) may be exercised as often as occasion therefor shall arise, it being agreed by Borrower that the exercise or failure to exercise any of same shall not in any event be construed as a waiver or release thereof or of any other right, remedy or recourse, and (4) are intended to be and shall be non-exclusive.  Nothing in this Agreement shall require or be construed to require Lender to accept tender of performance of any of Borrower’s obligations under this Agreement after the expiration of any time period set forth in this Agreement for the performance of such obligations and the expiration of any applicable cure periods, if any.
Section 7.03    Application of Proceeds.
Lender shall apply the Collateral or the cash proceeds actually received from any sale or other disposition of the Collateral in its sole and absolute discretion to the following, in any order:
(a)    to reimburse Lender for any amounts due to it pursuant to Section 7.02 of this Agreement including the expenses of preparing for sale, selling and the like and to reasonable attorneys’ fees and legal expenses incurred by Lender in connection therewith;
(b)    to the repayment of all amounts then due and unpaid on the Indebtedness in such order of priority as Lender may determine; and
(c)    to purchase any required Subsequent Interest Rate Cap that meets the requirements of this Agreement or any of the other Loan Documents.
If the proceeds of sale, collection or other realization of or upon the Collateral are insufficient to cover the costs and expenses of such realization and the payment in full of the Indebtedness, Borrower shall remain liable for the deficiency, except to the extent that Borrower’s liability for payment of the Indebtedness is limited by the terms of the Loan Agreement.
Section 7.04    No Additional Waiver Implied by One Waiver.
If any provision of this Agreement is breached by Borrower and thereafter waived by Lender in writing, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach under this Agreement.
Section 7.05    Lender Appointed Attorney‐in‐Fact.
Borrower hereby appoints Lender, through any duly authorized officer of Lender, as Borrower’s attorney-in-fact, with full authority in the place and stead of Borrower and in the name of Borrower or otherwise, from time to time in Lender’s discretion during the continuance of an Event of Default, to take any action and to execute any instrument which Lender may deem necessary or advisable to exercise the rights and remedies granted in this Agreement, including, to receive, endorse and collect all instruments made payable to Borrower representing any interest payment, dividend, or other distribution in respect of the Collateral or any part of the Collateral and to give full discharge for the same.  Borrower agrees that the power of attorney established pursuant to this Section 7.05 shall be deemed coupled with an interest and shall be irrevocable.

	
				
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Section 7.06    Nature of Lender’s Rights.
The right of Lender to the Collateral held for its benefit under this Agreement shall not be subject to any right of redemption Borrower might otherwise have and shall not be suspended, discontinued or reduced or terminated for any cause, including, without limiting the generality of the foregoing, any event constituting force majeure or any acts or circumstances that may constitute commercial frustration of purpose.
ARTICLE 8 
MISCELLANEOUS PROVISIONS
Section 8.01    Fees, Costs and Expenses; Indemnification.
Borrower agrees to reimburse Lender, on demand, for all out-of-pocket costs and expenses incurred by Lender in connection with the administration and enforcement of this Agreement or any Supplemental Agreement and agrees to indemnify and hold harmless Lender from and against any and all losses, costs, claims, damages, penalties, causes of action, suits, judgments, liabilities and expenses (including, without limitation, reasonable attorneys’ fees and expenses) incurred by Lender under this Agreement or any Supplemental Agreement or in connection with this Agreement or any Supplemental Agreement, unless such liability shall be due to willful misconduct or gross negligence on the part of Lender or its agents or employees.  If Borrower fails to do any act or thing which it has covenanted to do under this Agreement or any Supplemental Agreement or any representation or warranty on the part of Borrower contained in this Agreement or any Supplemental Agreement or repeated and reaffirmed in this Agreement or any Supplemental Agreement is breached, Lender may (but shall not be obligated to) do the same or cause it to be done or remedy any such breach, and may expend its funds for such purpose.  Any and all amounts so expended by Lender shall be repayable to it by Borrower upon Lender’s demand.  The obligations of Borrower under this Section 8.01 shall survive the termination of this Agreement or any Supplemental Agreement and the discharge of the other obligations of Borrower under this Agreement or any Supplemental Agreement.
Section 8.02    Termination.
This Agreement and each Supplemental Agreement and the assignments, pledges and security interests created or granted by this Agreement and each Supplemental Agreement shall create a continuing security interest in the Collateral and shall terminate upon the earlier to occur of (a) payment in full of all amounts due under the Loan Documents, or (b) the conversion of the Mortgage Loan to a fixed rate of interest pursuant to the terms of the Conversion Agreement.  Upon termination of this Agreement, Lender shall deliver to Borrower all Collateral and documents then in the custody or possession of Lender and, if requested by Borrower, shall execute and deliver to Borrower for recording or filing in each office in which any assignment or financing statement relative to the Collateral or the agreements relating thereto or any part of the Collateral, shall have been filed or recorded, a termination statement or release under applicable law (including, if relevant, any financing statement), releasing Lender’s interest in the Collateral and such other documents and instruments as Borrower may reasonably request, all without recourse to or any warranty whatsoever by Lender and at the cost and expense of Borrower.

	
				
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Section 8.03    No Deemed Waiver.
No failure on the part of Lender or any of its agents to exercise, and no course of dealing with respect to, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise by Lender or any of its agents of any right, power or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right, power or remedy.  The remedies herein are cumulative and are not exclusive of any remedies provided by law.
Section 8.04    Non-Recourse.
Article 3 (Personal Liability) of the Loan Agreement is hereby incorporated herein as if fully set forth in the body of this Agreement.
Section 8.05    Governing Law; Consent to Jurisdiction and Venue.
Section 15.01 (Governing Law; Consent to Jurisdiction and Venue) of the Loan Agreement is hereby incorporated herein as if fully set forth in the body of this Agreement.
Section 8.06    Notices.
Section 15.02 (Notice) of the Loan Agreement is hereby incorporated herein as if fully set forth in the body of this Agreement.
Section 8.07    Successors and Assigns Bound; Sale of Mortgage Loan.
Section 15.03 (Successors and Assigns Bound; Sale of Mortgage Loan) of the Loan Agreement is hereby incorporated herein as if fully set forth in the body of this Agreement.
Section 8.08    Counterparts.
Section 15.04 (Counterparts) of the Loan Agreement is hereby incorporated herein as if fully set forth in the body of this Agreement.
Section 8.09    Severability; Entire Agreement; Amendments.
Section 15.07 (Severability; Entire Agreement; Amendments) of the Loan Agreement is hereby incorporated herein as if fully set forth in the body of this Agreement.
Section 8.10    Construction.
Section 15.08 (Construction) of the Loan Agreement is hereby incorporated herein as if fully set forth in the body of this Agreement.
Section 8.11    WAIVER OF TRIAL BY JURY.
Section 15.18 (WAIVER OF TRIAL BY JURY) of the Loan Agreement is hereby incorporated herein as if fully set forth in the body of this Agreement.
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IN WITNESS WHEREOF, the parties have signed and delivered this Agreement under seal (where applicable) or have caused this Agreement to be signed and delivered under seal (where applicable) by their duly authorized representative.  Where applicable law so provides, the parties intend that this Agreement shall be deemed to be signed and delivered as a sealed instrument.
BORROWER:
SIR JEFFERSON, LLC, a Delaware limited
liability company

		
	By:
	Steadfast Income Advisor, LLC, a Delaware

limited liability company, its Manager

By: ___/s/ Kevin J. Keating_____________
Name: Kevin J. Keating
Title: Chief Accounting Officer

	
			
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LENDER:
FANNIE MAE

By:  JONES LANG LASALLE 
MULTIFAMILY, LLC, a Delaware limited
liability company, its Servicer

By:  ___/s/ Kevin Sullivan_______
Kevin Sullivan
Executive Vice President

	
			
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EXHIBIT A
TO
INTEREST RATE CAP RESERVE AND SECURITY AGREEMENT
Interest Rate Cap Documents
See Attached

	
			
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EXHIBIT B
TO
INTEREST RATE CAP RESERVE AND SECURITY AGREEMENT
SUPPLEMENTAL INTEREST RATE CAP RESERVE
AND SECURITY AGREEMENT
This SUPPLEMENTAL INTEREST RATE CAP RESERVE AND SECURITY AGREEMENT (“Supplemental Agreement”), dated as of ________________, is made by [NAME OF BORROWER], a [DESCRIPTION OF BORROWER], together with its permitted successors and assigns (“Borrower”), for the benefit of FANNIE MAE, a corporation duly organized under the Federal National Mortgage Association Charter Act, as amended, 12 U.S.C. §1716 et seq. and duly organized and existing under the laws of the United States ( “Fannie Mae”).
This Supplemental Agreement supplements the Interest Rate Cap Reserve and Security Agreement dated as of _______________, by and between Borrower and _________________________ (the “Original Lender”) (the “Agreement”).
RECITALS:
A.    Borrower and Original Lender entered into the Agreement pursuant to which Borrower is required to acquire and maintain or replace, as appropriate, an Interest Rate Cap (as defined in the Agreement) at all times during the term of the Mortgage Loan (as defined in the Agreement).  Each Interest Rate Cap will be represented by one or more Interest Rate Cap Documents (as defined in the Agreement).
B.    Original Lender assigned its interest in the Mortgage Loan to Fannie Mae and Fannie Mae is now the holder of the Note (as defined in the Agreement) and the mortgagee or beneficiary under the Security Instrument (as defined in the Loan Agreement) and all other Loan Documents (as defined in the Loan Agreement).
C.    Borrower is entering into a Subsequent Interest Rate Cap (as defined in the Agreement).
D.    As security for Borrower’s obligations under the Loan Documents, Borrower is entering into this Supplemental Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and undertakings set forth in this Supplemental Agreement and other good and valuable consideration, the receipt and sufficiency of which are acknowledged by Borrower, the parties agree as follows:
Section 1.Capitalized Terms.
All capitalized terms used in this Supplemental Agreement have the meanings given to those terms in the Agreement or elsewhere in this Supplemental Agreement unless the context or use clearly indicates a different meaning.

	
			
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Section 2.Grant of Security Interest.
As security for the due, punctual, full and exact payment, performance or observance by Borrower of all obligations owing to Lender from time to time under the Loan Documents, whether at stated maturity, by acceleration or otherwise, whether now outstanding or hereafter arising, Borrower confirms and grants to Fannie Mae a continuing security interest in and to the Subsequent Interest Rate Cap described in the attached Interest Rate Cap Documents and all such Interest Rate Cap Documents, whether now owned or hereafter acquired.
Section 3.Acquisition of Interest Rate Cap; Delivery of Interest Rate Cap Documents.
Borrower has, on or before the date of this Supplemental Agreement, executed and delivered the Interest Rate Cap Documents representing the Subsequent Interest Rate Cap to the Counterparty and has delivered to Fannie Mae fully executed originals of such Interest Rate Cap Documents to be held under the Agreement as a part of the Collateral.  The documents attached to this Supplemental Agreement as Attachment I are true, complete and correct copies of the Interest Rate Cap Documents and all amendments thereto, representing the Subsequent Interest Rate Cap, fully executed by all parties.  There is no and shall be no additional security for or any other arrangements or agreements relating to the Interest Rate Cap or the Interest Rate Cap Documents.
Section 4.Representations and Warranties.
As of the date of this Supplemental Agreement, Borrower repeats and confirms all representations and warranties made by Borrower in the Agreement.
Section 5.Agreement Confirmed.
Except as supplemented by this Supplemental Agreement, Borrower confirms the original Agreement as previously supplemented and amended from time to time.
Section 6.Obligations Remain Absolute.
Nothing contained in this Supplemental Agreement shall relieve Borrower of its primary obligation to pay all amounts due in respect of its obligations under the Loan Documents.
Section 7.Miscellaneous Provisions.
The provisions of Article 8 of the Agreement are hereby incorporated into this Supplemental Agreement by this reference to the fullest extent as if the text of such provisions were set forth in their entirety herein.
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IN WITNESS WHEREOF, Borrower has signed and delivered this Agreement under seal (where applicable) or has caused this Agreement to be signed and delivered under seal (where applicable) by its duly authorized representative.  Where applicable law so provides, Borrower intends that this Agreement shall be deemed to be signed and delivered as a sealed instrument
	
			
	BORROWER
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	By: 
	 
	(SEAL)

	Name:
	 
	 

	Title:
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	
			
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ATTACHMENT I
TO
SUPPLEMENTAL INTEREST RATE CAP RESERVE AND SECURITY AGREEMENT
Interest Rate Cap Documents for Subsequent Interest Rate Cap
[TO BE SUPPLIED]

	
			
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                                                        EXHIBIT 10.9          MULTIFAMILY LOAN AND SECURITY AGREEMENT                        (NON-RECOURSE)                        BY AND BETWEEN   BRE JEFFERSON ST. ANDREWS OWNER LLC, a Delaware limited liability                            company                               AND  JONES LANG LASALLE MULTIFAMILY, LLC, a Delaware limited liability                             company                           DATED AS OF                          October 31,2017     ~ FannieMae.  

 

                            TABLE OF CONTENTS   ARTICLE 1- DEFINITIONS; SUMMARY OF MORTGAGE LOAN TERMS ................................. 1    SECTION 1.0 I DEFINED TERMS • •• ••• .•••••• .••.•• •• •••• •.••••• •• ••••••.••••••••.•••••.•••.•.•••••••.• ••• •.•••• •••••••. •• .••.•••••••••••.•• 1    SECTION 1.02 SCHEDULES, EXHIBITS, AND ATTACHMENTS INCORPORATED ...................................... 1  ARTICLE 2- GENERA.L MORTGAGE LOAN TERMS ...................................................................... 2    SECTION 2.01 MORTGAGE LOAN ORIGINATION AND SECURITY ••••.•.•••.••..•• ••• ••••.•.••. ••••• •••••••.•••••••••••••••2      (a)   Making of Mortgage Loan ......................................................................................................... 2     (b)   Security for Mortgage Loan ........................•..............................................................................2      (c)   Protective Advances . ................................................... .............................................................. 2    SECTION 2.02 PAYMENTS ON MORTGAGE LoAN .••....••...•.••.•..••.•• ..••••..•..••. .••. .. ..•..•.•..•••••....••.••.••••.... .•. 2     (a)   Debt Service Payments ............................................. ............ ..................................................... 2     (b)   Capitalization of Accrued But Unpaid Interest. .................................................................... .....3      (c)   Late Charges . ............................................................................................................................. 3     (d)   Default Rate .............................................................................................................................. .4      (e)  Address for Payments ................................................................................................................ 5      (t)  Application of Payments ............................................................................................................ 5    SECTION 2.03 LOCKOUTIPREPAYMENT ................................................................................................ 5      (a)  Prepayment; Prepayment Lockout; Prepayment Premium ........................................................ 5      (b)  Voluntary Prepayment in Full ................................................................................................... 6      (c)  Acceleration of Mortgage Loan ................................................................................................. 6      (d)  Application of Collateral. .......................................................................................................... 7      (e)  Casualty and Condemnation . ..................................................................................................... 7      (t)  No Effect on Payment Obligations ............................................... ............................................. 7      (g)  Loss ReSUlting from Prepayment. ............................................................. ..... ............................ 7  ARTICLE 3 - PERSONAL LIABaITY... ............................... _...  _ ......................................................... 8     SECTION 3.01 NON-RECOURSE MORTGAGE LoAN; EXCEPTIONS . ....................................................... 8    SECTION 3 .02 PERSONAL LIABILITY OF BORROWER (EXCEPTIONS TO NON-RECOURSE PROVISION).8      (a)  Personal Liability Based on Lender's Loss ............................................................................... 8      (b)  Full Personal Liability for Mortgage Loan ................................................................................ 9    SECTION 3.03 PERSONAL LIABILITY FOR INDEMNITY OBLIGATIONS •••••••••••.•.•••••.••.••••••.•.••••••••••.•••.••• 9    SECTION 3.04 LENDER'S RIGHT TO FOREGO RIGHTS AGAINST MORTGAGED PROPERTY .•••••••••••••••• 1 0  ARTICLE 4 - BORROWER STATUS .................................................................................................... 10    SECTION 4 .0 I REPRESENTATIONS AND WARRANTIES ••••••••••••••••.••• •.•• ••• •. •••••••••.••.•..•.....•• .•.•••.••• •.• •• ••• 10      (a)  Due Organization and Qualification ........... .................................................. ............ ............... 10      (b)  Location ................................................................................................................................... 10       (c)  Power and Authority .................................... ............................................................................ 10      (d)  Due Authorization ........................................................................................................... ..... ... 11      (e)  Valid and Binding Obligations . ... ............................................................................................ 11      (t)  Effect of Mortgage Loan on Borrower's Financial Condition ................................................. 11      (g)  Economic Sanctions, Anti-Money Laundering, and Anti-Corruption ..................................... 11      (h)  Borrower Single Asset Status ................. ................................................................................. 12      (i)  No Bankruptcies or Judgments ................................................................................................ 13      m    No Actions or Litigation .......................................................................................................... 13      (k)  Payment of Taxes, Assessments, and Other Charges .............................................................. 14   Multlramlly Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                         Pagel  Fannie Mac                              01-16                    CJ 2016 Fannie Mac  

 

   (I)   Not a Foreign Person ............................................................................................................... 14     (m)   ERISA ...................................................................................................................................... 14     (n)   Default Under Other Obligations ............................................................................................. 14     (0)   Prohibited Person ..................................................................................................................... 15     (p)   No Contravention ..................................................................................................................... 15     (q)   lockbox Arrangement. ............................................................................................................ 15   SECTION 4.02 COVENANTS ................................................................................................................. 15     (a)   Maintenance of Existence; Organizational Documents ........................................................... 15     (b)   Economic Sanctions, Anti-Money laundering, and Anti-Corruption ..................................... 16     (c)   Payment of Taxes, Assessments, and Other Charges .............................................................. 16     (d)   Borrower Single Asset Status .................................................................................................. 17     (e)   ERISA ...................................................................................................................................... 18     (t)   Notice of Litigation or Insolvency ........................................................................................... 18     (g)   Payment of Costs, Fees, and Expenses .................................................................................... 18     (h)   Restrictions on Distributions ................................................................................................... 19     (i)   lockbox Arrangement. ............................................................................................................ 19  ARTICLE 5 - THE MORTGAGE LOAN .............................................................................................. 19    SECTION 5.0 I REPRESENTATIONS AND WARRANTIES ....................................................................... 19     (a)   Receipt and Review of loan Documents ................................................................................ 20     (b)   No Default...............................................................................................................................  20     (c)   No Defenses ............................................................................................................................. 20      (d)  loan Document Taxes ............................................................................................................. 20    SECTION 5.02 COVENANTS ................................................................................................................. 20      (a)  Ratification of Covenants; Estoppels; Certifications ............................................................... 20      (b)  Further Assurances .................................................................................................................. 21      (c)  Sale of Mortgage loan............................................................................................................  21      (d)  Limitations on Further Acts of Borrower................................................................................  22      (e)  Financing Statements; Record Searches .................................................................................. 22      (t)  loan Document Taxes ............................................................................................................. 22  ARTICLE 6 - PROPERTY USE, PRESERVATION, AND MAINTENANCE .................................. 23    SECTION 6.01 REPRESENTATIONS AND WARRANTIES ....................................................................... 23      (a)  Compliance with law; Permits and Licenses .......................................................................... 23      (b)  Property Characteristics ........................................................................................................... 23      (c)  Property Ownership ................................................................................................................. 23      (d)  Condition of the Mortgaged Property ...................................................................................... 24      (e)  Personal Property ..................................................................................................................... 24    SECTION 6.02 COVENANTS ................................................................................................................. 24      (a)  Use of Property ........................................................................................................................ 24      (b)  Property Maintenance .............................................................................................................. 24      (c)  Property Preservation ............................................................................................................... 26      (d)  Property Inspections ................................................................................................................ 27      (e)  Compliance with laws ............................................................................................................ 28    SECTION 6.03 MORTGAGE lOAN ADMINISTRATION MATTERS REGARDING THE PROPERTY ............ 28      (a)  Property Management.. ............................................................................................................ 28      (b)  Subordination of Fees to Affiliated Property Managers .......................................................... 28      (c)  Property Condition Assessment. .............................................................................................. 28    Multifamily Loan and SecurIty Agreement  (Non-Recourse)                       Form 6001.NR                         Page ii  FannIe Mae                              01-16                    ~ 2016 FannIe Mae  

 

ARTICLE  7 - LEASES AND RENTS ........... u •••••••• u ..............................................................................29     SECTION 7.0 I REPRESENTATIONS AND WARRANTIES .......................................................................29      (a)   Prior Assignment of Rents ....................................................................................................... 29     (b)   Prepaid Rents ........................................................................................................................... 29    SECTION 7.02 COVENANTS .................................................................................................................29      (a)   Leases ...................................................................................................................................... 29     (b)   Commercial Leases .................................................................................................................. 30     (c)   Payment of Rents ..................................................................................................................... 31     (d)   Assignment of Rents ................................................................................................................ 31     (e)   Further Assignments of Leases and Rents ............................................................................... 31     (t)   Options to Purchase by Tenants ............................................................................................... 31    SECTION 7.03 MORTGAGE LOAN ADMINISTRATION REGARDING LEASES AND RENTS ..................... 32     (a)   Material Commercial Lease Requirements .............................................................................. 32     (b)   Residential Lease Form ........................................................................................................... 32  ARTICLE 8 - BOOKS AND  RECORDS; FINANCIAL REPORTING .............................................. 32    SECTION 8.0 I REpRESENTATIONS AND WARRANTIES .......................................................................32       (a)  Financial Information .............................................................................................................. 32      (b)  No Change in Facts or Circumstances ..................................................................................... 33    SECTION 8.02 COVENANTS .................................................................................................................33       (a)  Obligation to Maintain Accurate Books and Records ............................................................. 33      (b)  Items to Furnish to Lender ....................................................................................................... 33      (c)  Audited Financials ................................................................................................................... 36      (d)  Delivery of Books and Records ............................................................................................... 36    SECTION 8.03 MORTGAGE LOAN ADMINISTRATION MATTERS REGARDING BOOKS AND RECORDS                 AND FINANCIAL REpORTING .......................................................................................36       (a)  Lender's Right to Obtain Audited Books and Records ........................................................... 36      (b)  Credit Reports; Credit Score .................................................................................................... 37  ARTICLE 9 - INSURANCE ..................................................................................................................... 37    SECTION 9.01 REpRESENTATIONS AND WARRANTIES .......................................................................37       (a)  Compliance with Insurance Requirements .............................................................................. 37      (b)  Property Condition ................................................................................................................... 3 7    SECTION 9.02 COVENANTS .................................................................................................................37       (a)  Insurance Requirements ........................................................................................................... 37      (b)  Delivery of Policies, Renewals, Notices, and Proceeds ........................................................... 38    SECTION 9.03 MORTGAGE LOAN ADMINISTRATION MATTERS REGARDING INSURANCE ................. 38      (a)  Lender's Ongoing Insurance Requirements ............................................................................ 38      (b)  Application of Proceeds on Event of Loss ............................................................................... 39      (c)  Payment Obligations Unaffected ............................................................................................. 41      (d)  Foreclosure Sale ....................................................................................................................... 41      (e)  Appointment of Lender as Attorney-In-Fact. .......................................................................... 41   ARTICLE  10 - CONDEl\fN'ATION .................. u ..........u  ........................................................................41     SECTION 10.01 REPRESENTATIONS AND WARRANTIES .......................................................................41       (a)  Prior Condemnation Action .................................................................................................... .4 I      (b)  Pending Condemnation Actions ............................................................................................. .42    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page ill  Fannie Mac                              01-16                    Cl2016 Fannie Mae  

 

  SECTION 10.02 COVENANTS .................................................................................................................42      (a)   Notice of Condemnation ......................................................................................................... .42     (b)   Condemnation Proceeds .......................................................................................................... 42    SECTION 10.03 MORTGAGE LOAN ADMINISTRATION MATTERS REGARDING CONDEMNATlON ......... 42     (a)   Application of Condemnation Awards ................................................................................... .42     (b)   Payment Obligations Unaffected ............................................................................................. 42     (c)   Appointment of Lender as Attorney-In-Fact. .......................................................................... 42     (d)   Preservation of Mortgaged Property ........................................................................................ 43  ARTICLE 11 - LIENS, TRANSFERS, AND ASSUlVIPTIONS ............................................................ 43    SECTION 11.0 I REPRESENTATIONS AND WARRANTIES .......................................................................43      (a)   No Labor or Materialmen's Claims ......................................................................................... 43     (b)   No Other Interests ................................................................................................................... .43    SECTION 11.02 COVENANTS .................................................................................................................43      (a)   Liens; Encumbrances ............................................................................................................... 43     (b)   Transfers .................................................................................................................................. 44     (c)   No Other Indebtedness ........................................................................................................... .46      (d)  No Mezzanine Financing or Preferred Equity ......................................................................... 46    SECTION 11.03 MORTGAGE LOAN ADMINISTRATION MATTERS REGARDING LIENS, TRANSFERS, AND                 ASSUMPTIONS .............................................................................................................46       (a)  Assumption of Mortgage Loan ............................................................................................... .46      (b)  Transfers to Key Principal-Owned Affiliates or Guarantor-Owned Affiliates ....................... .48      (c)  Estate Planning ........................................................................................................................ 48      (d)  Termination or Revocation of Trust. ....................................................................................... 49      (e)  Death of Key Principal or Guarantor; Transfer Due to Death ................................................. 49      (f)  Bankruptcy of Guarantor ......................................................................................................... 50      (g)  Further Conditions to Transfers and Assumption .................................................................... 51      (h)  Additional Permitted Transfers ................................................................................................ 52  ARTICLE  12 - Il\fiJOSITIONS ............................................................................................................... 53    SECTION 12.01 REPRESENTATIONS AND WARRANTIES ....................................................................... 53      (a)  Payment of Taxes, Assessments, and Other Charges .............................................................. 53    SECTION 12.02 COVENANTS .................................................................................................................54       (a)  imposition Deposits, Taxes, and Other Charges ...................................................................... 54    SECTION 12.03 MORTGAGE LOAN ADMINISTRATION MATTERS REGARDING iMposITIONS ............... 54      (a)  Maintenance of Records by Lender ......................................................................................... 54      (b)  imposition Accounts ................................................................................................................ 54      (c)  Payment ofimpositions; Sufficiency ofimposition Deposits ................................................. 55      (d)  imposition Deposits Upon Event of Default ............................................................................ 55      (e)  Contesting impositions ............................................................................................................ 55      (f)  Release to Borrower................................................................................................................  56  ARTICLE 13 - REPLACEMENT RESERVE AND REPAIRS ........................................................... 56    SECTION 13.01 COVENANTS .................................................................................................................56       (a)  Initial Deposits to Replacement Reserve Account and Repairs Escrow Account. .................. 56      (b)  Monthly Replacement Reserve Deposits ................................................................................. 56      (c)  Payment for Replacements and Repairs .................................................................................. 56      (d)  Assignment of Contracts for Replacements and Repairs ......................................................... 56      (e)  indemnification ........................................................................................................................ 57   Multifamily Loan and Sccurlty Agrcemcnt  (Non-Rccoursc)                       Form 6001.NR                        Page Iv  Fannie Mac                              01-16                    10 2016 Fannie Mac  

 

   (f)   Amendments to Loan Documents ............................................................................................ 57     (g)   Administrative Fees and Expenses .......................................................................................... 57    SECTION 13.02 MORTGAGE LOAN ADMINISTRATION MATIERS  REGARDING RESERVES •••.•••• •••• ••••• ••57      (a)   Accounts, Deposits, and Disbursements .................................................................................. 57     (b)   Approvals of Contracts; Assignment of Claims ...................................................................... 64     (c)   Delays and Workmanship ........................................................................................................ 64     (d)   Appointment of Lender as Attorney-In-Fact. .......................................................................... 64     (e)   No Lender Obligation .............................................................................................................. 64     (f)   No Lender Warranty ................................................................................................................ 65  ARTICLE  14 - DEFAULTSIREMEDIES.u..................................................................... ....................... 65    SECTION 14.01 EVENTS OF DEFAULT ................................................................................................... 65     (a)   Automatic Events of Derault. .................•.......................................... .......................•.............. 65     (b)   Events or Derault Subject to a Specified Cure Period . ....... ..................................................... 66      (c)  Events or Derault Subject to Extended Cure Period ................................... ............................. 66    SECTION 14.02 REMEDIES ••••••••• •• •••• •••• ••••• •• •.•.••• .•.••.•. ••. ..•• ••.•.•••.•••.••••.•••• •• •••• ••• ••• ••• ••.••....•• .••.•.••. .•.•. •• .••• 67      (a)  Acceleration; Foreclosure ........................................................................................................ 67      (b)  Loss of Right to Disbursements from Collateral Accounts ..................................................... 67      (c)  Remedies Cumulative ................................................................................................ .............. 68    SECTION 14.03 ADDITIONAL LENDER RIGHTS; FORBEARANCE .•.•••••••.••••••••••••••••••• •••••.••.•.••.•.•••••.••.•••• 68      (a)  No Effect Upon Obligations . ................................................................................................... 68      (b)  No Waiver of Rights or Remedies ........................................................................................... 69      (c)  Appointment of Lender as Attorney-In-Fact. .......................................................................... 69      (d)  Borrower Waivers .................................................................................................................... 70    SECTION 14.04 WAIVER OF MARsHALING ••.••.••.••• •.••.••.•••.••••••.•••••••.••.••.•••••.••.••• •• •• ••• ••• •.•••••.•.•••.•••.•••.•• 71  ARTICLE  15 - MISCELLANEOUS .................................................................... ....................................... 71    SECTION 15.01 GOVERNING LAW; CONSENT TO JURISDICTION AND VENUE ••.•..•• ..•.•..•• .•..•.••.•• .•.••• .•• . 71      (a)  Governing Law .............. .......................................................................................................... 71      (b)  Venue ....................................................................................................................................... 71    SECTION 15.02 NOTICE ........................................................................................................................ 72      (a)  Process or Serving Notice ........................................................................................................ 72      (b)  Change of Address ................................................................................................................... 72      (c)  Default Method of Notice ........................................................................................................ 72      (d)  Receipt of Notices .................................................................................................................... 72    SECTION 15.03 SUCCESSORS AND ASSIGNS BOUND; SALE OF MORTGAGE LOAN •• ••.•..••••.••••••••••••.••••• 73      (a)  Binding Agreement. ................................................................................................................. 73      (b)  Sale of Mortgage Loan; Change ofServicer.............................. ............................................. 73    SECTION 15.04 COUNTERPARTS ........................................................................................................... 73    SECTION 15.05 JOINT AND SEVERAL (OR SOLIDARY) LIABILITY •.••••.••••••.•.••. ••.•••.••. ••. •••••. •.•. •• •.•••••••.• •• 73    SECTION 15.06 RELATIONSHIP OF PARTIES; No THIRD PARTY BENEFICIARY •.•••••.•••• •.••.••••••• .••.••••.•••73       (a)  Solely Creditor and Debtor ....................................•...................................... ........................... 73      (b)  No Third Party Beneficiaries .......................................................................•........................... 73    Multlramlly Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                         Page v  FannlcMae                               01-16                    Cl1016 Fannie Mae  

 

  SECTION 15.07   SEVERABILITY;  ENTIRE AGREEMENT; AMENDMENTS ................................................ 74    SECTION 15.08   CONSTRUCTION ........................................................................................................... 74    SECTION 15.09   MORTGAGE LOAN    SERVICING ..................................................................................... 75    SECTION 15.10   DISCLOSURE OF  INFORMATION ................................................................................... 75    SECTION  15.11  WAIVER; CONFLICT .................................................... ; ................................................ 75    SECTION  15.12  No RELIANCE .............................................................................................................. 75    SECTION  15.13  SUBROGATION ............................................................................................................. 76    SECTION  15.14  COUNTING OF DAYS .................................................................................................... 76    SECTION  15.15  REVIVAL  AND REINSTATEMENT OF INDEBTEDNESS .................................................... 76    SECTION  15.16  TIME IS OFTHEEsSENCE ............................................................................................. 76    SECTION  15.17  FINAL AGREEMENT ..................................................................................................... 76    SECTION  15.18  WANER OF TRIAL BY JURY ................................................................................. 77    Multifamily Loan and Security Agreement  (Non-Recourse)                                Form 600l.NR                                 Page vi  Fannie Mae                                        01-16                          10 2016 Fannie Mae  

 

                            SCHEDULES &  EXHIBITS    Schedules   Schedule 1   Definitions Schedule (required)                  Form 6101.SARM   Schedule 2   Summary of Loan Terms (required)                 Form 6102.SARM   Schedule 3   Interest Rate Type Provisions (required)         Form 6103.SARM   Schedule 4   Prepayment Premium Schedule (required)           Form 6104.11   Schedule 5   Required Replacement Schedule (required)         Form 6001.NR   Schedule 6   Required Repair Schedule (required)              Form 6001.NR   Schedule 7   Exceptions to Representations and Warranties Schedule Form 6001.NR                 (required)    Exhibits   Exhibit A     Modifications to Multifamily Loan and Security  Form 6241                 Agreement (Green Financing Mortgage Loans)   ExhibitB      Modifications to Multifamily Loan and Security  Form 6245                 Agreement (Springing Cap)   Exhibit C     Modifications to Multifamily Loan and Security  Form 6228                 Agreement (Waiver ofImposition Deposits)    Multifamily Loan and Security Agreement  (Non-Recourse)                        Form 600J.NR                        Page vII   Fannie Mae                              OJ-Hi                   II:) 20\6 Fannie Mae  

 

                                                             Jefferson at Perimeter             MULTIFAMILY LOAN AND SECURITY AGREEMENT                                 (Non-Recourse)         This MULTIFAMILY LOAN    AND   SECURITY AGREEMENT     (as amended, restated,  replaced, supplemented or otherwise modified from time to time, the "Loan Agreement") is  made as of the Effective Date (as hereinafter defined) by and between BRE JEFFERSON ST.  ANDREWS OWNER LLC, a Delaware      limited liability company ("Borrower"), and JONES  LANG LASALLE MULTIFAMILY, LLC, a Delaware limited liability company ("Lender").                                    RECITALS:        WHEREAS, Borrower desires to obtain the Mortgage Loan (as hereinafter defined) from  Lender to be secured by the Mortgaged Property (as hereinafter defined); and        WHEREAS, Lender is  willing to make the Mortgage Loan on the terms and conditions  contained in this Loan Agreement and in the other Loan Documents (as hereinafter defined);        NOW,  THEREFORE,   in consideration of the making of the Mortgage Loan by Lender  and other good and valuable consideration, the receipt and adequacy of which are hereby  conclusively acknowledged, the parties hereby covenant, agree, represent, and warrant as  follows:                                 AGREEMENTS:          ARTICLE 1 -    DEFINITIONS; SUMMARY OF MORTGAGE                                  LOAN TERMS  Section 1.01   Defined Terms.        Capitalized terms not otherwise defined in the body of this Loan Agreement shall have  the mearungs set forth in the Definitions Schedule attached as Schedule I to this Loan  Agreement.  Section 1.02   Schedules, Exhibits, and Attachments Incorporated.        The schedules, exhibits, and any other addenda or attachments are incorporated fully into  this Loan Agreement by this reference and each constitutes a  substantive part of this Loan  Agreement.     Multifamily Loan and Security Agreement  (Non-Recourse)                        Form 6001.NR                        Page 1   Fannie Mae                              01-16                   C 2016 Fannie Mae  

 

           ARTICLE 2 -   GENERAL MORTGAGE LOAN TERMS  Section 2.01   Mortgage Loan Origination and Security.        (a)   Making of Mortgage Loan.        Subject to the terms and conditions of this Loan Agreement and the other Loan  Documents, Lender hereby makes the Mortgage Loan to Borrower, and Borrower hereby accepts  the Mortgage Loan from Lender. Borrower covenants and agrees that it shall:              (1)   pay the Indebtedness, including the Prepayment Premium, if any (whether        in connection with any voluntary prepayment or in connection with an acceleration by        Lender of the Indebtedness), in accordance with the terms of this Loan Agreement and        the other Loan Documents; and              (2)   perform, observe, and comply with this Loan Agreement and all other        provisions of the other Loan Documents.        (b)   Security for Mortgage Loan.        The Mortgage Loan is made pursuant to this Loan Agreement, is evidenced by the Note,  and is secured by the Security Instrument, this Loan Agreement, and the other Loan Documents  that are expressly stated to be security for the Mortgage Loan.        (c)   Protective Advances.        As provided in the Security Instrument, Lender may take such actions or disburse such  funds as Lender reasonably deems necessary to perform the obligations of Borrower under this  Loan Agreement and  the other Loan Documents and to protect Lender's interest in the  Mortgaged Property.  Section 2.02   Payments on Mortgage Loan.        (a)   Debt Service Payments.              (1)   Short Month Interest.              If the date the Mortgage Loan  proceeds are disbursed is any day other than the        first day of the month, interest for the period beginning on the disbursement date and        ending on and including the last day of the month in which the disbursement occurs shall        be payable by Borrower on the date the Mortgage Loan proceeds are disbursed. In the        event that the disbursement date is not the same as the Effective Date, then:                    (A)   the disbursement date and the Effective Date must be in the same              month, and                    (B)   the Effective Date shall not be the first day of the month.              (2)   Interest Accrual and Computation.              Except as provided in Section 2.02(a)(1), interest shall be paid in arrears. Interest        shall accrue as provided in the Schedule of Interest Rate Type Provisions and shall be   Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                         Page 2  Article 2                                01-16                   11:1 2016 Fannie Mae  

 

      computed in accordance with the Interest Accrual Method. If the Interest Accrual        Method is "Actual/360," Borrower acknowledges and agrees that the amount allocated to        interest for each month will vary depending on the actual number of calendar days during        such month.              (3)   Monthly Debt Service Payments.              Consecutive monthly debt service installments (comprised of either interest only        or principal and interest, depending on the Amortization Type), each in the amount of the        applicable Monthly Debt Service Payment, shall be due and payable on the First Payment        Date, and on each Payment Date thereafter until the Maturity Date, at which time all        Indebtedness shall be due. Any regularly scheduled Monthly Debt Service Payment that        is received by Lender before the applicable Payment Date shall be deemed to have been        received on such Payment Date solely for the purpose of calculating interest due. All        payments made by Borrower under this Loan Agreement shall be made without set-off,        counterclaim, or other defense.              (4)   Payment at Maturity.              The unpaid principal balance of the Mortgage Loan, any Accrued Interest thereon        and all other Indebtedness shall be due and payable on the Maturity Date.              (5)   Interest Rate Type.              See the Schedule of Interest Rate Type Provisions for additional provisions, if        any, specific to the Interest Rate Type.        (b)   Capitalization of Accrued But Unpaid Interest.        Any accrued and unpaid interest on the Mortgage Loan remaining past due for thirty (30)  days or more may, at Lender's election, be added to and become part of the unpaid principal  balance of the Mortgage Loan.        (c)   Late Charges.              (1)   If any Monthly Debt Service Payment due hereunder is not received by        Lender within ten (10) days (or fifteen (15) days for any Mortgaged Property located in        Mississippi or North Carolina to comply with applicable law) after the applicable        Payment  Date, or any amount payable under this Loan Agreement (other than the        payment due on the Maturity Date for repayment of the Mortgage Loan in full) or any        other Loan Document is not received by Lender within ten (10) days (or fifteen (15) days        for any Mortgaged Property located in Mississippi or North Carolina to comply with        applicable law) after the date such amount is due, inclusive of the date on which such        amount is due, Borrower shall pay to Lender, immediately without demand by Lender,        the Late Charge.        The Late Charge is payable in addition to, and not in lieu of, any interest payable at the        Default Rate pursuant to Section 2.02(d).      Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                         Page 3  Anicle 2                                 01-16                   C> 2016 Fannie Mae  

 

           (2)   Borrower acknowledges and agrees that:                   (A)   its failure to make timely payments will cause Lender to incur             additional expenses in servicing and processing the Mortgage Loan;                   (B)   it is extremely difficult and impractical to determine those             additional expenses;                    (C)   Lender is entitled to be compensated for such additional expenses;             and                   (0)   the Late Charge represents a fair and reasonable estimate, taking             into account all circumstances  existing on the date  hereof, of the additional             expenses Lender will incur by reason of any such late payment.       (d)   Default Rate.              (I)   Default interest shall be paid as follows:                   (A)   If any amount due in respect of the Mortgage Loan (other than             amounts due on the Maturity Date) remalDS past due for thirty (30) days or more,             interest on such unpaid amount(s) shall accrue from the date payment is due at             the Default Rate and shall be payable upon demand by Lender.                    (B)   If any Indebtedness due is not paid in full on the Maturity Date,             then interest shall accrue at the Default Rate on all such unpaid amounts from the             Maturity Date until fully paid and shall be payable upon demand by Lender.       Absent a demand by Lender, any such amounts shall be payable by Borrower in the same       manner as provided for the payment of Monthly Debt Service Payments. To the extent        permitted by applicable law, interest shall also accrue at the Default Rate on any       judgment obtained by Lender against Borrower in connection with the Mortgage Loan.        To the eldent Borrower or any other Person is vested with a right of redemption, interest       shall continue to accrue at the Default Rate during any redemption period until such time       as the Mortgaged Property has been redeemed.              (2)   Borrower acknowledges and agrees that:                    (A)   its failure to make timely payments will cause Lender to incur              additional expenses in servicing and processing the Mortgage Loan; and                    (B)   in connection with any failure to timely pay all amounts due in              respect of the Mortgage Loan on the Maturity Date, or during the time that any              amount due in respect of the Mortgage Loan is delinquent for more than              thirty (30) days:                          (i)   Lender's risk of nonpayment of the Mortgage Loan will be                    materially increased;                           (ii)  Lender's ability to meet its other obligations and to take                    advantage of other investment opportunities will be adversely impacted;    Multlramily Loan and SecurIty Agreement  (Non-Recourse)                       Form 6001.NR                        Page 4  Article 2                               01-16                   C 2016 Fannie Mae  

 

                        (iii) Lender will incur additional costs and expenses arising                    from its loss of the use of the amounts due;                          (iv)  it is extremely difficult and impractical to determine such                    additional costs and expenses;                          (v)   Lender is entitled to be compensated for such additional                    risks, costs, and expenses; and                          (vi)  the increase from the Interest Rate to the Default Rate                    represents a fair and reasonable estimate of the additional risks, costs, and                    expenses Lender will incur by reason of Borrower's delinquent payment                    and the additional compensation Lender is entitled to receive for the                    increased risks of nonpayment associated with a delinquency on the                    Mortgage Loan (taking into account all circumstances existing on the                    Effecti ve Date).        (e)   Address for Payments.         All payments due pursuant to the Loan Documents shall be payable at Lender's Payment  Address, or such other place and in such manner as may be designated from time to time by  written notice to Borrower by Lender.         (t)   Application of Payments.        If at any time Lender receives, from Borrower or otherwise, any payment in respect of  the Indebtedness that is less than all amounts due and payable at such time, then Lender may  apply such payment to amounts then due and payable in any manner and in any order determined  by Lender or hold in suspense and not apply such payment at Lender's election. Neither  Lender's acceptance of a payment that is less than all amounts then due and payable, nor  Lender's application of, or suspension of the application of, such payment, shall constitute or be  deemed  to constitute either a waiver of the unpaid amounts or an accord and satisfaction.  Notwithstanding the application of any such payment to the Indebtedness, Borrower's  obligations under this Loan Agreement and the other Loan Documents shall remain unchanged.  Section 2.03   LockoutJPrepayment.        (a)   Prepayment; Prepayment Lockout; Prepayment Premium.              (1)   Borrower shall not make a voluntary full or partial prepayment on the        Mortgage Loan during any Prepayment Lockout Period nor shall Borrower make a        voluntary partial prepayment at any time. Except as expressly provided in this Loan        Agreement (including as provided in the Prepayment Premium Schedule), a Prepayment        Premium  calculated in accordance with the Prepayment Premium Schedule shall be        payable in connection with any prepayment of the Mortgage Loan.              (2)   If a Prepayment Lockout Period applies to the Mortgage Loan, and during        such Prepayment Lockout Period Lender accelerates the unpaid principal balance of the        Mortgage Loan or otherwise applies collateral held by Lender to the repayment of any         portion of the unpaid principal balance of the Mortgage Loan, the Prepayment Premium        shall be due and payable and equal to the amount obtained by multiplymg the percentage    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                         PageS  Article 2                                01-16                   II:> 2016 Fannie Mae  

 

      indicated (if at all) in the Prepayment Premium Schedule by the amount of principal        being prepaid at the time of such acceleration or application.        (b)   Voluntary Prepayment in Full.        At any time after the expiration of any Prepayment Lockout Period, Borrower may  voluntarily prepay the Mortgage Loan in full on a Permitted Prepayment Date so long as:              (1)   Borrower delivers to Lender a Prepayment Notice specifying the Intended        Prepayment Date not more than sixty (60) days, but not less than thirty (30) days (if        given via U.S. Postal Service) or twenty (20) days (if given via facsimile, e-mail, or        overnight courier) prior to such Intended Prepayment Date; and              (2)   Borrower pays to Lender an amount equal to the sum of:                    (A)   the entire unpaid principal balance of the Mortgage Loan; plus                    (B)   all Accrued Interest (calculated through the last day of the month              in which the prepayment occurs); plus                     (C)   the Prepayment Premium; plus                    (D)   all other Indebtedness.  In cOMection with any such voluntary prepayment, Borrower acknowledges and agrees that  interest shall always be calculated and paid through the last day of the month in which the  prepayment occurs (even if the Permitted Prepayment Date for such month is not the last day of  such month, or if Lender approves prepayment on an Intended Prepayment Date that is not a  Permitted Prepayment Date). Borrower further acknowledges that Lender is not required to  accept a voluntary prepayment of the Mortgage Loan on any day other than a Permitted  Prepayment Date. However, if Lender does approve an Intended Prepayment Date that is not a  Permitted Prepayment Date and accepts a prepayment on such Intended Prepayment Date, such  prepayment shall be deemed to be received on the immediately following Permitted Prepayment  Date. If Borrower fails to prepay the Mortgage Loan on the Intended Prepayment Date for any  reason (including on any Intended Prepayment Date that is approved by Lender) and such failure  either continues for five (5) Business Days, or into the following month, Lender shall have the  right to recalculate the payoff amount. If Borrower prepays the Mortgage Loan either in the  following month or more than five (5) Business Days after the Intended Prepayment Date that  was approved by Lender, Lender shall also have the right to recalculate the payoff amount based  upon the amount of such payment and the date such payment was received by Lender. Borrower  shall immediately pay to Lender any additional amounts required by any such recalculation.        (c)   Acceleration of Mortgage Loan.        Upon acceleration of the Mortgage Loan, Borrower shall pay to Lender:               (1)   the entire unpaid principal balance of the Mortgage Loan;               (2)   all Accrued Interest (calculated through the last day of the month in which        the acceleration occurs);               (3)   the Prepayment Premium; and    Multifamily Loan and Security Agreement   (Non-Recourse)                       Form 6001.NR                         Page 6   Article 2                               01-16                   C> 2016 Fannie Mae  

 

            (4)   all other Indebtedness.        (d)   Application of Collateral.        Any application by Lender of any collateral or other security to the repayment of all or  any portion of the unpaid principal balance of the Mortgage Loan prior to the Maturity Date in  accordance with the Loan Documents shall be deemed to be a prepayment by Borrower. Any  such prepayment shall require the payment to Lender by Borrower of the Prepayment Premium  calculated on the amount being prepaid in accordance with this Loan Agreement.        (e)   Casualty and Condemnation.         Notwithstanding any provision of this Loan Agreement to the contrary, no Prepayment  Premium shall be payable with respect to anr prepayment occurring as a result of the application  of any insurance proceeds or amounts receIVed in connection with a Condemnation Action in  accordance with this Loan Agreement.         (f)   No Effect on Payment Obligations.        Unless otherwise expressly provided in this Loan Agreement, any rrepayment required  by any Loan Document of less than the entire unpaid principal balance 0 the Mortgage Loan  shall not extend or postpone the due date of any subsequent Monthly Debt Service Payments,  Monthly Replacement Reserve Deposit, or other payment, or change the amount of any such  payments or deposits.        (g)   Loss Resulting from Prepayment.        In any circumstance in which a Prepayment Premium is due under this Loan Agreement,  Borrower acknowledges that:              (1)   any prepayment of the unpaid principal balance of the Mortgage Loan,        whether voluntary or involuntary, or following the occurrence of an Event of Default by        Borrower, will result in Lender's incurring loss, including reinvestment loss, additional        risk, expense, and frustration or impairment of Lender's ability to meet its commitments        to third parties;                                               I              (2)   it is extremely difficult and impractical to ascertain the extent of such        losses, risks, and damages;               (3)  the formula for calculating the Prepayment Premium represents  a        reasonable estimate of the losses, risks, and damages Lender will incur as a result of a         prepayment; and               (4)   the provisions regarding the Prepayment Premium contained in this Loan        Agreement are a material part of the consideration for the Mortgage Loan, and that the        terms of the Mortgage Loan are in other respects more favorable to Borrower as a result        of Borrower's voluntary agreement to such prepayment provisions.     Multlramlly Loan and Security Agreement   (Non-Recourse)                       Form 6001.NR                        Poge7   Article 2                               01-16                   02016 Fonnie Moc  

 

                 ARTICLE 3 -  PERSONAL LIABILITY  Section 3.01  Non-Recourse Mortgage Loan; Exceptions.       Except as otherwise provided in this Article 3 or in any other Loan Document, none of  Borrower, or any director, officer, manager, member, partner, shareholder, trustee, trust  beneficiary, or employee of Borrower, shall have personal liability under this Loan Agreement or  any other Loan Document for the repayment of the Indebtedness or for the performance of any  other obligations of Borrower under the Loan Documents, and Lender's only recourse for the  satisfaction of such Indebtedness and the performance of such obligations shall be Lender's  exercise of its rights and remedies with respect to the Mortgaged Property and  any other  collateral held by Lender as security for the Indebtedness. This limitation on Borrower's liability  shall not limit or impair Lender's enforcement of its rights against Guarantor under any Loan  Document.  Section 3.02  Personal Liability of Borrower (Exceptions to Non-Recourse Provision).       (a)   Personal Liability Based on Lender's Loss.       Borrower shall be personally liable to Lender for the repayment of the portion of the  Indebtedness equal to any loss or damage suffered by Lender as a result of, subject to any notice  and cure period, if any:             (1)  failure to pay as directed by Lender upon demand after an Event of       Default (to the extent actually ~eceived by Borrower):                   (A)  all Rents to which Lender is entitled under the Loan Documents;             and                   (B)  the amount of all security deposits then held or thereafter             collected by Borrower from tenants and not properly applied pursuant to the             applicable Leases;             (2)   failure to maintain all insurance policies required by the Loan Documents,        except to the extent Lender has the obligation to pay the premiums pursuant to Section        12.03(c);             (3)   failure to apply all insurance proceeds received by Borrower or any        amounts received by Borrower in connection with a Condemnation Action, as required        by the Loan Documents;             (4)   failure to comply with any provision of this Loan Agreement or any other        Loan Document relating to the delivery of books and records, statements, schedules, and        reports;             (5)   except to the extent directed otherwise by Lender pursuant to Section        3.02(a)(I), failure to apply Rents to the ordinary and necessary expenses of owning and        operating the Mortgaged Property and Debt Service Amounts, as and when each is due        and payable, except that Borrower will not be personally liable with respect to Rents that        are distributed by Borrower in any calendar year if Borrower has paid all ordinary and        necessary expenses of owning and operating the Mortgaged Property and Debt Service        Amounts for such calendar year;   Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 8  Article 3                            01-16                 IC 2016 Fannie Mae  

 

            (6)   waste or abandonment of the Mortgaged Property; or              (7)   grossly negligent or reckless unintentional material misrepresentation or        omission by Borrower, Guarantor, Key Principal, or any officer, director, partner,        manager, member, shareholder, or trustee of Borrower, Guarantor, or Key Principal in        connection with on-going financial or other reporting required by the Loan Documents,        or any request for action or consent by Lender.  Notwithstanding the foregoing, Borrower shall not have personal liability under clauses (1), (3),  or (5) above to the extent that Borrower lacks the legal right to direct the disbursement of the  applicable funds due to an involuntary Bankruptcy Event that occurs without the consent,  encouragement, or active participation of (A) Borrower, Guarantor, or Key Principal, (B) any  Person Controlling Borrower, Guarantor, or Key Principal or (C) any Person Controlled by or  under common Control with Borrower, Guarantor, or Key Principal.        (b)   Full Personal Liability for Mortgage Loan.        Borrower shall be personally liable to Lender for the repayment of all of the  Indebtedness, and the Mortgage Loan shall be fully recourse to Borrower, upon the occurrence of  any of the following:              (1)   failure by Borrower to comply with the single-asset entity requirements of        Section 4.02(d) of this Loan Agreement;              (2)   a Transfer (other than a conveyance of the Mortgaged Property at a        Foreclosure Event pursuant to the Security Instrument and this Loan Agreement) that is        not permitted under this Loan Agreement or any other Loan Document;              (3)   the occurrence of any Bankruptcy Event (other than an acknowledgement        in writing as described in clause (b) of the definition of "Bankruptcy Event"); provided,        however, in the event of an involuntary Bankruptcy Event, Borrower shall only be        personally liable if such involuntary Bankruptcy Event occurs with the consent,        encouragement, or active participation of (A) Borrower, Guarantor, or Key Principal, (8)        any Person Controlling Borrower, Guarantor, or Key Principal, or (C) any Person        Controlled by or under common Control with Borrower, Guarantor, or Key Principal;              (4)   fraud, written material misrepresentation, or material omission by        Borrower, Guarantor, Key Principal, or any officer, director, partner, manager, member,        shareholder, or trustee of Borrower, Guarantor, or Key Principal in connection with any        application for or creation of the Indebtedness; or              (5)   fraud, written intentional material misrepresentation, or intentional        material omission by Borrower, Guarantor, Key Principal, or any officer, director,         partner, manager, member, shareholder, or trustee of Borrower, Guarantor, or Key        Principal in connection with on-going financial or other reporting required by the Loan        Documents, or any request for action or consent by Lender.  Section 3.03   Personal Liability for Indemnity Obligations.        Borrower shall be personally and fully liable to Lender for Borrower's indemnity  obligations under Section 13.0 1(e)  of this Loan Agreement, the Environmental Indemnity  Agreement, and any other express indemnity obligations provided by Borrower under any Loan    Multifamily Loan and Security Agreement   (Non-Recourse)                       Form 6001.NR                        Page 9   Article 3                               01-16                   Cl 2016 Fannie Mae  

 

Document.  Borrower's liability for such indemnity obligations shall not be limited by the  amount of the Indebtedness, the repayment of the Indebtedness, or otherwise, provided that  Borrower's liability for such indemnities shall not include any loss caused by the gross  negligence or willful misconduct of Lender as determined by a court of competent jurisdiction  pursuant to a final non-appealable court order.  Section 3.04   Lender's Right to Forego Rights Against Mortgaged Property.        To the extent that Borrower has personal liability under this Loan Agreement or any other  Loan Document, Lender may exercise its rights against Borrower personally to the fullest extent  permitted by applicable law without regard to whether Lender has exercised any rights against  the Mortgaged Property, the VCC Collateral, or any other security, or pursued any rights against  Guarantor, or pursued any other rights available to Lender under this Loan Agreement, any other  Loan Document, or applicable law. For purposes of this Section 3.04 only, the term "Mortgaged  Property" shall not include any funds that have been applied by Borrower as required or  permitted by this Loan Agreement prior to the occurrence of an Event of Default, or that  Borrower was unable to apply as required or permitted by this Loan Agreement because of a  Bankruptcy Event. To the fullest extent permItted by applicable law, in any action to enforce  Borrower's personal liability under this Article 3, Borrower waives any right to set off the value  of the Mortgaged Property against such personal liability.                      ARTICLE 4 -    BORROWER STATUS  Section 4.01   Representations and Warranties.        The representations and warranties made by Borrower to Lender in this Section 4.01 are  made as of the Effective Date and are true and correct except as disclosed on the Exceptions to  Representations and Warranties Schedule.        (a)   Due Organization and Qualification.        Borrower is validly existing and qualified to transact business and is in good standing in  the state in which it is formed or organized, the Property Jurisdiction, and in each other  jurisdiction that qualification or good standing is required according to applicable law to conduct  its business with respect to the Mortgaged Property and where the failure to be so qualified or in  good standing would adversely affect Borrower's operation of the Mortgaged Property or the  validity, enforceability or the ability of Borrower to perform its obligations under this Loan  Agreement or any other Loan Document.        (b)   Location.        Borrower's General Business Address is Borrower's principal place of business and  principal office.        (c)   Power and Authority.        Borrower has the requisite power and authority:              (I)   to own  the Mortgaged Property and to carry on its business as now        conducted and as contemplated to be conducted in connection with the performance of its        obligations under this Loan Agreement and under the other Loan Documents to which it        is a party; and    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 10   Anicle3                                 01-16                   Q 2016 Fannie Mae  

 

            (2)   to execute and deliver this Loan Agreement and the other Loan        Documents to which it is a party, and to carry out the transactions contemplated by this        Loan Agreement and the other Loan Documents to which it is a party.        (d)   Due Authorization.         The execution, delivery, and perfonnance of this Loan Agreement and the other Loan  Documents to which it is a party have been duly authorized by all necessary action and  proceedings by or on behalf of Borrower, and no further approvals or filings of any kind,  tncluding any approval of or filing with any Governmental Authority, are required by or on  behalf of Borrower as a condition to the valid execution, delivery, and perfonnance by Borrower  of this Loan Agreement or any of the other Loan Documents to which It is a party, except filings  required to perfect and maintain the liens to be granted under the Loan Documents and routine  filings to maintain good standing and its existence.        (e)   Valid and Binding Obligations.        This Loan Agreement and the other Loan Documents to which it is a party have been  duly executed and delivered by Borrower and constitute the legal, valid, and binding obligations  of Borrower, enforceable against Borrower in accordance with their respective tenns, except as  such enforceability may be limited by applicable Insolvency Laws or by the exercise of  discretion by any court.         (I)   Effect of Mortgage Loan on Borrower's Financial Condition.        The Mortgage Loan will not render Borrower Insolvent. Borrower has sufficient working  capital, including proceeds from the Mort~age Loan, cash flow from the Mortgaged Property, or  other sources, not only to adequately matntain the Mortgaged Property, but also to pay all of  Borrower's outstanding debts as they come due, including all Debt Service Amounts, exclusive  of Borrower's ability to refinance or pay in full the Mortgage Loan on the Maturity Date. In  connection with the execution and delivery of this Loan Agreement and the other Loan  Documents (and the delivery to, or for the benefit of, Lender of any collateral contemplated  thereunder), and the incurrence by Borrower of the obligations under this Loan Agreement and  the other Loan Documents, Borrower did not receive less than reasonably equivalent value in  exchange for the incurrence of the obligations of Borrower under this Loan Agreement and the  other Loan Documents.        (g)   Economic Sanctions, Anti-Money Laundering, and Anti-Corruption.              (I)   None  of Borrower, Guarantor, or Key Principal, nor to Borrower's        knowledge, any Person Controlling Borrower, Guarantor, or Key Principal, nor any        Person Controlled by Borrower, Guarantor, or Key Principal that also has a direct or        indirect ownership interest in Borrower, Guarantor, or Key Principal, is in violation of        any applicable civil or criminal laws or regulations, including those requiring internal        controls, intended to prohibit, prevent, or regulate money laundering, drug trafficking,        terrorism, or corruption, of the United States and the jurisdiction where the Mortgaged        Property is located or where the Person resides, is domiciled, or has its principal place of         bustness.               (2)   None of Borrower, Guarantor, or Key Principal, nor to Borrower's         knowledge, any Person Controlling Borrower, Guarantor, or Key Principal, nor any     Multifamily Loan and Security Agreement   (Non-Recourse)                       Form 6001.NR                        Page 11   Article 4                               01-16                   02016 Fannie Mac  

 

     Person Controlled by Borrower, Guarantor, or Key Principal that also has a direct or       indirect ownership interest in Borrower, Guarantor, or Key Principal, is a Person:                  (A)   against whom proceedings are pending for any alleged violation             of any laws described in Section 4.0I(g)(I);                  (B)   that has been convicted of any violation of, has been subject to             civil penalties or Economic Sanctions pursuant to, or had any of its property             seized or forfeited under, any laws described in Section 4.0I(g)(I); or                  (C)   with whom any United States Person, any entity organized under             the laws of the United States or its constituent states or territories, or anX entity,             regardless of where organized, having its principal place of business WIthin the             United States or any of its territories, is a Sanctioned Person or is otherwise             prohibited from transacting business of the type contemplated by this Loan             Agreement and the other Loan Documents under any other applicable law.             (3)  Borrower, Guarantor, and Key Principal are in compliance with all       applicable Economic Sanctions laws and regulations.       (h)   Borrower Single Asset Status.       Borrower:             (I)  does not own or lease any real property, personal property, or assets other       than the Mortgaged Property;             (2)  does not own, operate, or participate in any business other than the        leasing, ownership, management, operation, and maintenance of the Mortgaged Property;             (3)   has no material financial obligation under or secured by any indenture,        mortgage, deed of trust, deed to secure debt, loan agreement, or other agreement or        instrument to which Borrower is a party, or by which Borrower is otherwise bound, or to        which the Mortgaged Property is subject or by which it is otherwise encumbered, other        than:                   (A)  unsecured trade payables incurred in the ordinary course of the             operation of the Mortgaged Property (exclusive of amounts for rehabilitation,             restoration, repairs, or replacements of the Mortgaged Property) that (i) are not             evidenced by a promissory note, (ii) are payable within sixty (60) days of the             date incurred, and (iii) as of the Effective Date, do not exceed, in the aggregate,             four percent (4%) of the original principal balance of the Mortgage Loan;                   (B)  if the Security Instrument grants a lien on a leasehold estate,             Borrower's obligations as lessee under the ground lease creating such leasehold             estate; and                   (C)  obligations under the Loan Documents and obligations secured by             the Mortgaged Property to the extent permitted by the Loan Documents;             (4)   has maintained its financial statements, accounting records, and other        partnership, real estate investment trust, limited liability company, or corporate   Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 12  Articie4                             01-16                 It'J 2016 Fannie Mae  

 

      documents, as the case may be, separate from those of any other Person (unless        Borrower's assets have been included in a consolidated financial statement prepared in        accordance with generally accepted accounting principles);              (5)   has not cornmingled its assets or funds with those of any other Person"        unless such assets or funds can easily be segregated and identified in the ordinary course        of business from those of any other Person;               (6)   has been adequately capitalized in light of its contemplated business        operations;               (7)   has not assumed, guaranteed, or pled~ed its assets to secure the liabilities        or obligations of any other Person (except in connection with the Mortgage Loan or other        mortgage loans that have been paid in full or collaterally assigned to Lender, including in        connection with any Consolidation, Extension and Modification Agreement or similar        instrument), or held out its credit as being available to satisfy the obligations of any other        Person;               (8)   has not made loans or advances to any other Person; and               (9)   has not entered into, and is not a party to, any transaction with any        Borrower Affiliate, except in the ordinary course of business and on terms which are no        more favorable to any such Borrower Affiliate than would be obtained in a comparable        arm's length transaction with an unrelated third party.        (i)   No Bankruptcies or Judgments.        None of Borrower, Guarantor, or Key Principal, nor to Borrower's knowledge, any  Person Controlling Borrower, Guarantor, or Key Principal, nor any Person Controlled by  Borrower, Guarantor, or Key Principal that also has a direct or indirect ownership interest in  Borrower, Guarantor, or Key Principal, is currently:               (1)   the subject of or a party to any completed or pending bankruptcy,        reorganization, including any receivership or other insolvency proceeding;               (2)   preparing or intending to be the subject of a Bankruptcy Event; or               (3)   the subject of any judgment unsatisfied of record or docketed in any court;        or              (4)   Insolvent.         (j)   No Actions or Litigation.              (1)   There are no claims, actions, suits, or proceedings at law or in equity by or        before any Governmental Authority now pending against or, to Borrower's knowledge,        threatened against or affecting Borrower or the Mortgaged Property not otherwise        covered by insurance (except claims, actions, suits, or proceedings regarding fair        housing, anti-discrimination, or equal opportunity, which shall always be disclosed); and              (2)   there are no claims, actions, suits, or proceedings at law or in equity by or        before any Governmental Authority now pending or, to Borrower's knowledge,   Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 13  Article 4                                01-16                   C> 2016 Fannie Mae  

 

      threatened against or affecting Guarantor or Key Principal. which claims. actions. suits.        or proceedings. if adversely determined (individually or in the aggregate) reasonably        would be expected to materially adversely affect the fmancial condition or business of        Borrower. Guarantor. or Key Principal or the condition. operation. or ownership of the        Mortgaged Property (except claims. actions. suits. or proceedings regarding fair housing.        anti-discrimination. or equal opportunity. which shall always be deemed material).        (k)   Payment of Taxes, Assessments, and Other Charges.         Borrower confirms that:               (1)   it has filed all federal. state. county. and municipal tax returns and reports        required to have been filed by Borrower;               (2)   it has paid. before any fine. penalty. interest. lien. or costs may be added        thereto. all taxes. governmental charges. and assessments due and payable with respect to        such returns and reports;               (3)   there is no controversy or objection pending. or to the knowledge of        Borrower. threatened in respect of any tax returns of Borrower; and               (4)   it has made adequate reserves on its books and records for all taxes that        have accrued but which are not yet due and payable.         (I)   Not a Foreign Person.         Borrower is not a "foreign person" within the meaning of Section 1445(f)(3) of the  Internal Revenue Code.         (m)   ERISA.        Borrower represents and warrants that:               (1)   Borrower is not an Employee Benefit Plan;               (2)   no asset of Borrower constitutes "plan assets" (within the meaning of        Section 3(42) of ERISA and Department of Labor Regulation Section 2510.3-101 as        modified by Section 3(42) of ERISA) of an Employee Benefit Plan;              (3)   no asset of Borrower is subject to any laws of any Governmental        Authority governing the assets of an Employee Benefit Plan; and              (4)   neither Borrower nor any ERISA Affiliate is subject to any obligation or        liability with respect to any ERISA Plan.        (n)   Default Under Other Obligations.               (1)   The execution. delivery. and performance of the obligations imposed on        Borrower under this Loan Agreement and the Loan Documents to which it is a party will        not cause Borrower to be in default under the provisions of any agreement. judgment. or        order to which Borrower is a party or by which Borrower is bound.    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 14  Article 4                                01-16                   «:12016 Fannie Mae  

 

            (2)   None of Borrower, Guarantor, or Key Principal is in default under any        obligation to Lender.         (0)   Prohibited Person.        None of Borrower, Guarantor, or Key Principal is a Prohibited Person, nor to Borrower's  knowledge, is any Person:               (\)   Controlling Borrower, Guarantor, or Key Principal a Prohibited Person; or               (2)  Controlled by and having a direct or indirect ownership interest in        Borrower, Guarantor, or Key Principal a Prohibited Person.        (p)   No Contravention.        Neither the execution and delivery of this Loan Agreement and the other Loan  Documents to which Borrower is a party, nor the fulfillment of or compliance with the terms and  conditions of this Loan Agreement and the other Loan Documents to which Borrower is a party,  nor the performance of the obligations of Borrower under this Loan Agreement and the other  Loan Documents does or will conflict with or result in any breach or violation of, or constitute a  default under, any of the terms,  conditions, or provisions of Borrower's organizational  documents, or any indenture, existing agreement, or other instrument to which Borrower is a  party or to which Borrower, the Mortgaged Property, or other assets of Borrower are subject.        (q)   Lockbox Arrangement.         Borrower is not party to any type of lockbox agreement or similar cash management  arrangement that has not been approved by Lender in writing, and no direct or indirect owner of  Borrower relating to the direct payment of income from the Mortgaged Property (but not any  arrangement with respect to distributions made to any direct or indirect owner of Borrower) is  party to any type of lockbox agreement or similar cash management arrangement with respect to  Rents or other income from the Mortgaged Property that has not been approved by Lender in  writing.  Section 4.02   Covenants.        (a)   Maintenance of Existence; Organizational Documents.        Borrower shall maintain its existence, its entity status, franchises, rights, and privileges   under the laws of the state of its formation or organization (as applicable). Borrower shall  continue to be duly qualified and in good standing to transact business in each jurisdiction in  which qualification or standing is required according to applicable law to conduct its business   with respect to the Mortgaged Property and where the failure to do so would adversely affect  Borrower's operation of the Mortgaged Property or the validity, enforceability, or the ability of   Borrower to perform its obligations under this Loan Agreement or any other Loan Document.  Neither Borrower nor any partner, member, manager, officer, or director of Borrower shall:               (\)   make or allow any material change to the organizational documents or         organizational structure of Borrower, including changes relating to the Control of         Borrower, or     Multifamily Loan and Security Agreement   (Non-Recourse)                       Form 600J.NR                        PagelS   Article 4                               01-16                   C) 2016 Fannie Mae  

 

            (2)   file any action, complaint, petition, or other claim to:                    (A)   divide, partition, or otherwise compel the sale of the Mortgaged              Property, or                     (B)   otherwise change the Control of Borrower.        (b)   Economic Sanctions, Anti·Money Laundering, and Anti·Corruption.               (I)   Borrower, Guarantor, Key Principal, and  any Person Controlling        Borrower, Guarantor, or Key Principal, or any Person Controlled by Borrower,        Guarantor, or Key Principal that also has a direct or indirect  ownership interest in        Borrower, Guarantor, or Key Principal shall remain in compliance with any applicable        civil or criminal laws or regulations (including those requiring intemal controls) intended        to prohibit, prevent, or regulate money laundering, drug trafficking, terrorism, or        corruption, of the United States and the jurisdiction where the Mortgaged Property is        located or where the Person resides, is domiciled, or has its principal place of business.              (2)   At no time shall Borrower, Guarantor, or Key Principal, or any Person        Controlling Borrower, Guarantor, or Key Principal, or any Person Controlled by        Borrower, Guarantor, or Key Principal that also has a direct or indirect ownership interest        in Borrower, Guarantor, or Key Principal, be a Person:                    (A)   Intentionally Deleted;                    (8)   that has been convicted of any violation of, has been subject to              civil penalties or Economic Sanctions pursuant to, or had any of its property              seized or forfeited under, any laws described in Section 4.02(b)(l); or                     (C)   with whom any United States Person, any entity organized under              the laws of the United States or its constituent states or territories, or any entity,              regardless of where organized, having its principal place of business within the              United States or any of its territories, is a Sanctioned Person or is otherwise              prohibited from transacting business of the type contemplated by this Loan              Agreement and the other Loan Documents under any other applicable law.              (3)   Borrower, Guarantor, and Key Principal shall at all times remain in        compliance with any applicable Economic Sanctions laws and regulations.        (c)   Payment of Taxes, Assessments, and Other Charges.        Borrower shall file all federal, state, county, and municipal tax returns and reports  required to be filed by Borrower and shall pay, before any fine, penalty, interest, or cost may be  added thereto, all taxes payable with respect to such returns and reports; provided, nothing herein  shall require Borrower to pay any tax so long as Borrower in good faith and at its own expense  and by proper legal proceedings is diligently contesting the validity, amount or application of  such tax and at the time of commencement of the proceeding and during the pendency thereof (i)  no Lien has been or is filed against the Mortgaged Property, (ii) no Mortgaged Property will be  in material danger of being sold, forfeited or lost, as determined by Lender (iii) Borrower shall  furnish such security as may be required in such proceeding or as may be reasonably requested  by Lender to insure the payment of the amounts contested (after taking into account any reserves    Multifamily Loan and Security Agreement  (Non·Recourse)                       Form 6001.NR                        Page 16  Article 4                                01·16                   C> 2016 Fannie Mae  

 

held by Lender for such purpose) and (iv) such contest operates to suspend collection or  enforcement of the contested amount, as applicable. .       (d)   Borrower Single Asset Status.       Until the Indebtedness is fully paid, Borrower:             (1)  shall not acquire or lease any real property, personal property, or assets       other than the Mortgaged Property, other than additions to, or replacements of personal       property and equipment in the ordinary course of business;              (2)  shall not acquire, own, operate, or participate in any business other than       the leasing, ownership, management, operation, and maintenance of the Mortgaged       Property;             (3)  shall not commingle its assets or funds with those of any other Person,       unless such assets or funds can easily be segregated and identified in the ordinary course       of business from those of any other Person;             (4)  shall maintain its financial statements, accounting records, and other       partnership, real estate investment trust, limited liability company, or corporate       documents, as the case may be, separate from those of any other Person (unless       Borrower's assets are included in a consolidated financial statement prepared in       accordance with generally accepted accounting principles);             (5)  shall have no material financial obligation under any indenture, mortgage,       deed of trust, deed to secure debt, loan agreement, or other agreement or instrument to       which Borrower is a party or by which Borrower is otherwise bound, or to which the       Mortgaged Property is subject or by which it is otherwise encumbered, other than:                   (A)  unsecured trade payables incurred in the ordinary course of the             operation of the Mortgaged Property (exclusive of amounts (i) to be paid out of             the Replacement Reserve Account or Repairs Escrow Account, or (ii) for             rehabilitation, restoration, repairs, or replacements of the Mortgaged Property or             otherwise approved by Lender) so long as such trade payables (1) are not             evidenced by a promissory note, (2) are payable within sixty (60) days of the             date incurred, and (3) as of any date, do not exceed, in the aggregate, two percent             (2%) of the original principal balance of the Mortgage Loan; provided, however,             that otherwise compliant outstanding trade payables may exceed two percent             (2%) up to an aggregate amount of four percent (4%) of the original principal             balance of the Mortgage Loan for a period (beginning on or after the Effective             Date) not to exceed ninety (90) consecutive days; provided, nothing herein shall             require Borrower to pay any trade payable so long as Borrower in good             faith and at its own expense and by proper legal proceedings is diligently             contesting the validity, amount or application of such trade payable and at the             time of commencement of the proceeding and during the pendency thereof (i) no             Lien has been or is filed against the Mortgaged Property, (ii) no Mortgaged             Property will be in material danger of being sold, forfeited or lost, as determined             by Lender, (iii) Borrower shall furnish such security as may be required in such             proceeding or as may be reasonably requested by Lender to insure the payment             of the amounts contested and (iv) such contest operates to suspend collection or             enforcement of the contested amount, as applicable;   Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 17  Article 4                            01-16                 C> 2016 Fannie Mae  

 

                (B)   if the Security Instrument grants a lien on a leasehold estate,             Borrower's obligations as lessee under the ground lease creating such leasehold             estate; and                  (C)   obligations under the Loan Documents and obligations secured by             the Mortgaged Property to the extent pennitted by the Loan Documents;             (6)  shall not assume, guaranty, or pledge its assets to secure the liabilities or       obligations of any other Person (except in connection with the Mortgage Loan or other       mortgage loans that have been paid in full or collaterally assigned to Lender, including in       connection with any Consolidation, Extension and Modification Agreement or similar       instrument) or hold out its credit as being available to satisfy the obligations of any other       Person;             (7)  shall not make loans or advances to any other Person; or             (8)  shall not enter into, or become a party to, any transaction with any       Borrower Affiliate, except in the ordinary course of business and on tenns which are no       more favorable to any such Borrower Affiliate than would be obtained in a comparable       arm's-length transaction with an unrelated third party.        (e)  ERISA.       Borrower covenants that:             (I)  no asset of Borrower shall constitute "plan assets" (within the meaning of        Section 3(42) of ERISA and Department of Labor Regulation Section 2510.3-101 as        modified by Section 3(42) of ERISA) of an Employee Benefit Plan;             (2)   no asset of Borrower shall be subject to the laws of any Governmental        Authority governing the assets of an Employee Benefit Plan; and             (3)   neither Borrower nor any ERISA Affiliate shall incur any obligation or        liability with respect to any ERISA Plan.        (t)  Notice of Litigation or Insolvency.        Borrower shall give irnmediate written notice to Lender of any claims, actions, suits, or  proceedings at law or in equity (including any insolvency, bankruptcy, or receivership  proceeding) by or before any Governmental Authority pending or, to Borrower's knowledge,  threatened against or affecting Borrower, Guarantor, Key Principal, or the Mortgaged Property,  which claims, actions, suits, or proceedings, if adversely detennined reasonably would be  expected to materially adversely affect the financial condition or business of Borrower,  Guarantor, or Key Principal, or the condition, operation, or ownership of the Mortgaged Property  (including any claims, actions, suits, or proceedings regarding fair housing, anti-discrimination,  or equal opportunity, which shall always be deemed material).        (g)  Payment of Costs, Fees, and Expenses.        In addition to the payments specified in this Loan Agreement, Borrower shall pay, on  demand, all of Lender's out-of-pocket fees, costs, charges, or expenses (including the reasonable    Multifamily Loan and Security Agreement  (Non-Reeourse)                    Form 6001.NR                     Page 18  Article 4                            01-16                 11:>2016 Fannie Mae  

 

fees and expenses of third party attorneys, accountants, and other experts) incurred by Lender in  connection with:              (I)   any amendment to, or consent, or waiver required under, this Loan        Agreement or any of the Loan Documents (whether or not any such amendments,        consents, or waivers are entered into);              (2)   defending or participating in any litigation arising from actions by third        parties and brought against or involving Lender with respect to:                    (A)   the Mortgaged Property;                    (B)   any event, act, condition, or circumstance in connection with the              Mortgaged Property; or                     (e)   the relationship between or among Lender, Borrower, Key              Principal, and Guarantor in connection with this Loan Agreement or any of the              transactions contemplated by this Loan Agreement;              (3)   the administration or enforcement of, or preservation of rights or remedies        under, this Loan Agreement or any other Loan Documents including or in connection        with any litigation or appeals, any Foreclosure Event or other disposition of any collateral        granted pursuant to the Loan Documents; and              (4)   any Bankruptcy Event or Guarantor Bankruptcy Event.        (h)   Restrictions on Distributions.        No distributions or dividends of any nature with respect to Rents or other income from  the Mortgaged Property shall be made to any Person having a direct ownership interest in  Borrower if an Event of Default has occurred and is continuing.        (i)   Lockbox Arrangement.        Borrower shall not enter into any type of lockbox agreement or similar cash management  arrangement that has not been approved by Lender in writing, and no direct or indirect owner of  Borrower shall enter into any type of lockbox agreement or similar cash management  arrangement with respect to Rents or other income from the Mortgaged Property that has not  been approved by Lender in writing. Lender's approval of any such cash management  arrangement may be conditioned upon requiring Borrower to enter into a lockbox agreement or  similar cash management arrangement with Lender in form and substance acceptable to Lender  with regard to Rents and other income from the Mortgaged Property.                     ARTICLE 5 -   THE MORTGAGE LOAN  Section 5.01   Representations and Warranties.        The representations and warranties made by Borrower to Lender in this Section 5.01are  made as of the Effective Date and are true and correct except as disclosed on the Exceptions to  Representations and Warranties Schedule.    Multifamily Loan and Seeurlty Agreement  (Non-Recourse)                       Form 600J.NR                        Page 19  Article 4                                01-16                   (l:) 2016 Fannie Mae  

 

     (a)   Receipt and Review of Loan Documents.       Borrower has received and reviewed this Loan Agreement and all of the other Loan  Documents.       (b)   No Default.       No default exists under any of the Loan Documents.       (c)   No Defenses.       The Loan Documents are not currently subject to any right of rescission, set-off,  counterclaim, or defense by either Borrower or Guarantor, including the defense of us1;U1, and  neither Borrower nor Guarantor has asserted any right of rescission, set-off, countercilum, or  defense with respect thereto.       (d)   Loan Document Taxes.       All mortgage, mortgage recording, stamp, intangible, or any other similar taxes required  to be paid by any Person under applicable law currently in effect in connection with the  execution, delivery, recordation, filing, registration, perfection, or enforcement of any of the  Loan Documents, including the Security Instrument, have been paid or will be paid in the  ordinary course of the closing of the Mortgage Loan.  Section 5.02  Covenants.        (a)  Ratification of Covenants; Estoppels; Certifications.        Borrower shall:             (1)   promptly notify Lender in writing upon any violation of any covenant set        forth in any Loan Document of which Borrower has notice or knowledge; provided,        however, any such written notice by Borrower to Lender shall not relieve Borrower of, or        result in a waiver of, any obligation under this Loan Agreement or any other Loan        Document; and             (2)   within ten (10) Business Days after a request from Lender, provide a        written statement, signed and acknowledged by Borrower (but absent an Event of        Default, no more frequently than once in any six (6) month period), certifying to Lender        or any person designated by Lender, as of the date of such statement:                   (A)  that the Loan Documents are unmodified and in full force and             effect (or, if there have been modifications, that the Loan Documents are in full             force and effect as modified and setting forth such modifications);                   (8)  the unpaid principal balance of the Mortgage Loan;                   (C)  the date to which interest on the Mortgage Loan has been paid;                    (0)  that Borrower is not in default in paying the Indebtedness or in             performing or observing any of the covenants or agreements contained in this    Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 20  Article 5                            01-16                 10 2016 Fannie Moe  

 

           Loan Agreement or any of the other Loan Documents (or, if Borrower is in             default, describing such default in reasonable detail);                  (E)   whether or not there are then-existing any setoffs or defenses             known to Borrower against the enforcement of any right or remedy of Lender             under the Loan Documents; and                  (F)   any additional facts reasonably requested in writing by Lender in             connection with the Mortgaged Property, the Mortgage Loan or any of the             Loan Documents.       (b)   Further Assurances.              (1)  Other Documents As Lender May Require.              Within ten (10) Business Days after request by Lender, Borrower shall, ~ubject to       Section S.02(d) below, execute, acknowledge, and deliver, at. its cost and expense, all       further acts, deeds, conveyances, assignments, financing statements, transfers,       documents, agreements, assurances, and such other instruments as Lender may       reasonably require from time to time in order to better assure, grant, and convey to       Lender the rights intended to be granted, now or in the future, to Lender under this Loan       Agreement and the other Loan Documents.             (2)  Corrective Actions.             Within ten (10) Business Days after request by Lender, Borrower shall provide, or       cause to be provided, to Lender, at Borrower's cost and expense, such further       documentation or information reasonably deemed necessary or appropriate by Lender in       the exercise of its rights under the related commitment letter between Borrower and       Lender or to correct patent mistakes in the Loan Documents, the Title Policy, or the       funding of the Mortgage Loan.        (c)  Sale of Mortgage Loan.        Borrower shall, subject to Section S.02(d) below:             (1)  comply with the reasonable requirements of Lender or any Investor of the        Mortgage Loan or provide, or cause to. be provided, to Lender or any Investor of the        Mortgage Loan within ten (10) Business Days of the request, at Borrower's cost and        expense, such further documentation or information as Lender or Investor may        reasonably require, in order to enable:                   (A)  Lender to sell the Mortgage Loan to such Investor;                   (B)  Lender to obtain a refund of any commitment fee from any such             Investor; or                   (C)  any such Investor to further sell or securitize the Mortgage Loan;             (2)   ratify and affirm in writing the representations and warranties set forth in        any Loan Document as of such date specified by Lender modified as necessary to reflect        changes that have occurred subsequent to the Effective Date;   Multifamily Loan and Security Agreement  (Non-Recourse)                    Forni 6001.NR                    Page 21  Article 5                            01-16                 IC 2016 Fannie Mae  

 

           (3)  confirm that Borrower is not in default in paying the Indebtedness or in       performing or observing any of the covenants or agreements contained in this Loan       Agreement or any of the other Loan Documents (or, if Borrower is in default, describing       such default in reasonable detail); and             (4)  execute and deliver to Lender and/or any Investor such other       documentation, including any amendments, corrections, deletions, or additions to this       Loan Agreement or other Loan Document(s) as is reasonably required by Lender or such       Investor which are reasonably necessary to accomplish the purposes of the Loan       Documents.       (d)   Limitations on Further Acts of Borrower.       Nothing in Section 5.02(b) and Section 5.02(c) shall require Borrower to do any further  act that has the effect of:             (1)  changing the economic terms of the Mortgage Loan set forth in the related       commitment letter between Borrower and Lender; .             (2)  imposing on Borrower or Guarantor greater personal liability under the       Loan Documents than that set forth in the related commitment letter between Borrower       and Lender; or             (3)  materially changing the rights and obligations of Borrower or Guarantor       under the commitment letter.       (e)   Financing Statements; Record Searches.             (1)  Borrower shall pay all costs and expenses associated with:                  (A)   any filing or recording of any fmancing statements, including all             continuation statements, termination statements, and amendments or any other             filings related to security interests in or liens on collateral; and                   (B)   any record searches for financing statements that Lender may             require.             (2)  Borrower hereby authorizes Lender to file any financing statements,        continuation statements, termination statements, and amendments (including an "all        assets" or "all personal property" collateral description or words of similar import) in        form and substance as Lender may require in order to protect and preserve Lender's lien        priority and security interest in the Mortgaged Property (and to the extent Lender has        filed any such financing statements, continuation statements, or amendments prior to the        Effective Date, such filings by Lender are hereby authorized and ratified by Borrower).         (t)  Loan Document Taxes.        Borrower shall pay, on demand, any transfer taxes, documentary taxes, assessments, or  charges made by any Govemmental Authority in connection with the execution, delivery,  recordation, filing, registration, perfection, or enforcement of any of the Loan Documents or the  Mortgage Loan.    Multlramlly Loan and Seeurlty Agreement  (Non-Recourse)                    Form 6001.NR                     Page 22  Article 5                            01-16                 II:) 2016 Fannie Mae  

 

ARTICLE 6 -    PROPERTY USE, PRESERVATION, AND             MAINTENANCE  Section 6.01   Representations and Warranties.        The representations and warranties made by Borrower to Lender in this Section 6.01 are  made as of the Effective Date and are true and correct except as disclosed on the Exceptions to  Representations and Warranties Schedule.        (a)   Compliance with Law; Permits and Licenses.              (1)   To Borrower's knowledge, all improvements to the Land and the use of        the Mortgaged PropertY comply with all applicable laws, ordinances, statutes, rules, and        regulations, including all applicable statutes, rules, and regulations pertaining to        requirements for equal opportunity, anti-discrimination, fair housing, and rent control,        and Borrower has no knowledge of any action or proceeding (or threatened action or        proceeding) regarding noncompliance or nonconformity with any of the foregoing.              (2)   To Borrower's knowledge, there is no evidence of any illegal activities on        the Mortgaged PropertY.              (3)   To  Borrower's knowledge, no  permits or  approvals from any        Govemmental Authority, other than those previously obtained and furnished to Lender,        are necessary for the commencement and completion of the Repairs or Replacements, as        applicable, other than those permits or approvals which will be timely obtained in the        ordinary course of business.              (4)   All required permits, licenses, and certificates to comply with all zoning        and land use statutes, laws, ordinances, rules, and regulations, and all applicable health,        fire, safety, and building codes, and for the lawful use and operation of the Mortgaged        PropertY, including certificates of occupancy, apartment licenses, or the equivalent, have        been obtained and are in full force and effect.              (5)   No  portion of the Mortgaged PropertY has been purchased with the        proceeds of any illegal activity.        (b)   Property Characteristics.              (1)   The Mortgaged Property contains at least:                    (A)   the Property Square Footage;                    (B)   the Total Parking Spaces; and                     (C)   the Total Residential Units.              (2)   No part of the Land is included or assessed under or as part of another tax        lot or parcel, and no part of any other property is included or assessed under or as part of        the tax lot or parcels for the Land.        (c)   Property Ownership.        Borrower is sole owner or ground lessee of the Mortgaged PropertY.   Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 23  Article 6                                01-16                   @2016 Fannie Mae  

 

      (d)   Condition of the Mortgaged Property.              (1)   Borrower has not made any claims, and to Borrower's knowledge, no        claims have been made, against any contractor, engineer, architect, or other party with        respect to the construction or condition of the Mortgaged Property or the existence of any        structural or other material defect therein; and              (2)   neither the Land nor the Improvements has sustained any damage other        than damage which has been fully repaired, or is fully insured and is being repaired in the        ordinary course of business.        (e)   Personal Property.        Borrower owns (or, to the extent disclosed on the Exceptions to Representations and  Warranties Schedule, leases) all of the Personal Property that is material to and is used in  connection with the management, ownership, and operation of the Mortgaged Property.   Section 6.02   Covenants        (a)   Use of Property.        From and after the Effective Date, Borrower shall not, unless required by applicable law  or Governmental Authority:              (1)   change the use of all or any part of the Mortgaged Property;              (2)   convert any individual dwelling units or common areas to commercial use,        or convert any common area or commercial use to individual dwelling units;              (3)   initiate or acquiesce in a change in the zoning classification of the Land;              (4)   establish any condominium or cooperative regime with respect to the        Mortgaged Property;              (5)   subdivide the Land; or              (6)   suffer, permit, or initiate the joint assessment of any Mortgaged Property        with any other real property constituting a tax lot separate from such Mortgaged Property        which could cause the part of the Land to be included or assessed under or as part of        another tax lot or parcel, or any part of any other property to be included or assessed        under or as part of the tax lot or parcels for the Land.        (b)   Property Maintenance.        Borrower. shall:              (1)   pay the expenses of opemting, managing, maintaining, and repairing the        Mortgaged Property (including insurance premiums, utilities, Repairs, and Replacements)        before the last date upon which each such payment may be made without any penalty or        interest charge being added;    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 24  Article 6                                01-16                   ID 2016 Fannie Mae  

 

           (2)  keep the Mortgaged Property in good repair and marketable condition       (ordinary wear and tear excepted) (including the replacement of Personalty and Fixtures       with items of equal or better function and quality) and subject to Section 9.03(b)(3) and       Section lO.03(d) restore or repair promptly, in a good and workmanlike manner, any       damaged part of the Mortgaged Property to the equivalent of its original condition or       condition immediately prior to the damage (if improved after the Effective Date),       whether or not any insurance proceeds or amounts received in connection with a       Condemnation Action are available to cover any costs of such restoration or repair;             (3)  commence  all Required Repairs, Additional Lender Repairs, and       Additional Lender Replacements as follows:                  (A)   with respect to any Required Repairs, promptly following the             Effective Date (subject to Force Majeure, if applicable), in accordance with the             timelines set forth on the Required Repair Schedule, or if no timelines are             provided, as soon as practical following the Effective Date;                   (B)   with respect to Additional Lender Repairs, in the event that             Lender reasonably determines that Additional Lender Repairs are necessary from             time to time or pursuant to Section 6.03(c), promptly following Lender's written             notice of such Additional Lender Repairs (subject to Force  Majeure, if             applicable), commence any such Additional Lender Repairs in accordance with             Lender's timelines, or if no timelines are provided, as soon as reasonably             practical;                   (C)  with respect to Additional Lender Replacements, in the event that             Lender reasonably determines that Additional Lender Replacements are             necessary from time to time or pursuant to Section 6.03(c), promptly following             Lender's written notice of such Additional Lender Replacements (subject to             Force  Majeure, if applicable), commence any such Additional Lender             Replacements in accordance with Lender's timelines, or if no timelines are             provided, as soon as reasonably practical;             (4)   make, construct, install, diligently perform, and complete all        Replacements and Repairs:                   (A)  in a good and workmanlike manner as soon as practicable             following the commencement thereof, free and clear of any Liens, including             mechanics' or materialmen's liens and encumbrances (except Permitted             Encumbrances and mechanics' or materialmen's liens which attach automatically             under the laws of any Governmental Authority upon the commencement of any             work upon, or delivery of any materials to, the Mortgaged Property and for             which Borrower is not delinquent in the payment for any such work or materials)             provided, nothing herein shall require Borrower to pay for any work or             materials so long as Borrower in good faith and at its own expense and by             proper legal proceedings is diligently contesting the validity, amount or             application of such work or materials and at the time of commencement of the             proceeding and during the pendency thereof (i) no Mortgaged Property will             be in material danger of being sold, forfeited or lost, as determined by Lender,             (ii) Borrower shall furnish such security as may be required in such             proceeding or as may be reasonably requested by Lender to insure the payment    Multlramlly Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page2S  Article 6                            01-16                 C 2016 Fannie Mae  

 

           of the amounts contested and (iii) such contest opemtes to suspend collection or             enforcement of the contested amount, as applicable;                  (B)   in accordance with all applicable laws, ordinances, rules, and             regulations of any Governmental Authority, including applicable building codes,             special use permits, and environmental regulations;                  (C)   in accordance with all applicable insurance and bonding             requirements; and                  (D)   within all timeframes required by Lender, and Borrower             acknowledges that it shall be an Event of Default if Borrower abandons or ceases             work on any Repair at any time prior to the completion of the Repairs for a             period of longer than twenty (20) days (except when Force Majeure exists and             Borrower is diligently pursuing the reinstitution of such work, provided,             however, any such abandonment or cessation shall not in any event allow the             Repair to be completed after the Completion Period, subject to Force Majeure);             and             (5)   subject to the terms of Section 6.03(a) provide for professional        management of the Mortgaged Property by a residential rental property manager        reasonably satisfactory to Lender under a contract approved by Lender In writing;             (6)   give written notice to Lender of, and, unless otherwise directed in writing        by Lender, appear in and defend any action or proceeding purporting to affect the        Mortgaged Property, Lender's security for the Mortgage Loan, or Lender's rights under        this Loan Agreement; and             (7)   upon Lender's written request, submit to Lender any contracts or work        orders described in Section J3.02(b).        (c)  Property Preservation.        Borrower shall:             (1)   not cornmit waste or abandon or (ordinary wear and tear excepted) permit        impairment or deterioration of the Mortgaged Property;             (2)   except as otherwise permitted herein in connection with Repairs and        Replacements, not remove, demolish, or alter the Mortgaged Property or any part of the        Mortgaged Property (or permit any tenant or any other person to do the same) except in        connection with the replacement of tangible Personalty or Fixtures (provided such        Personalty and Fixtures are replaced with items of equal or better function and quality)        provided, however, that Borrower may make a1temtions and additions to the Mortgaged        Property to renovate or upgmde commercial space, shared amenities or multifamily        residential units, provided that (I) such a1temtions and additions are completed in a lien        free and good and workmanlike manner in accordance with applicable laws and the        provisions of this Loan Agreement, (2) neither the performance nor completion of the        altemtions or additions (A) affects the structural integrity of the Mortgaged Property or        the occupancy of the Mortgaged Property, (B) changes unit configurations, or (C)        reduces the total number of units, and (3) the aggregate costs of all such alterations and        additions ongoing during anyone year, does not exceed $500,000; provided, nothing   Multlramlly Loan and SecurIty Agreement  (Non·Recourse)                    Form 6001.NR                     Page 26  Article 6                            01·16                 C 2016 FannIe Mae  

 

     herein shall require Borrower to pay for any alterations and additions so long as       Borrower in good faith and at its own expense and by proper legal proceedings is       diligently contesting the validity, amount or application of such alterations and additions       and at the time of commencement of the proceeding and during the pendency thereof (i)       no Lien has been or is filed against the Mortgaged Property, (ii) no Mortgaged Property       will be in material danger of being sold, forfeited or lost as determined by Lender, (iii)       Borrower shall furnish such security as may be required in such proceeding or as may be       reasonably requested by Lender to insure the payment of the amounts contested and (iv)       such contest operates to suspend collection or enforcement of the contested amount, as       applicable;             (3)   not engage in or knowingly permit, and shall take appropriate measures to       prevent and abate or cease and desist, any illegal activities at the Mortgaged Property that       could endanger tenants or visitors, result in damage to the Mortgaged Property, result in       forfeiture of the Land or otherwise  materially impair the lien created by the Security       Instrument or Lender's interest in the Mortgaged Property;             (4)   not permit any condition to exist on the Mortgaged Property that would       invalidate any part of any insurance coverage required by this Loan Agreement; or             (5)   not subject the Mortgaged Property to any voluntary, elective, or non-      compulsory tax lien or assessment (or opt in to any voluntary, elective, or non­      compulsory special tax district or similar regime).        (d)   Property Inspections.       Borrower shall:             (I)   permit Lender, its agents, representatives, and designees to enter upon and       inspect the Mortgaged Property (including in connection with any Replacement or       Repair, or to conduct any Environmental Inspection pursuant to the Environmental       Indemnity Agreement), and shall cooperate and provide access to all areas of the       Mortgaged Property (subject to the rights of tenants under the Leases):                   (A)   during normal business hours;                   (B)   at such other reasonable time upon reasonable notice of not less             than one (I) Business Day;                    (C)   at any time when exigent circumstances exist; or                    (0)    at any time after an Event of Default has occurred and is             continuing; and             (2)    pay for reasonable costs or expenses incurred by Lender or its agents in       connection with any such inspections.    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 27  Article 6                               01-16                   02016 Fannie Mae  

 

      (e)   Compliance with Laws.        Borrower shall:              (1)   comply with all laws, ordinances, statutes, rules, and regulations of any        Governmental Authority and all recorded lawful covenants and agreements relating to or        affecting the Mortgaged Property, including all laws, ordinances, statutes, rules and        regulations, and covenants pertaining to construction of improvements on the Land, fair        housing, and requirements for equal opportunity, anti-discrimination, and Leases;              (2)   procure and maintain all required permits, licenses, charters, registrations,        and certificates necessary to comply WIth all zoning and land use statutes, laws,        ordinances, rules and regulations, and all applicable health, fire, safety, and building        codes and for the lawful use and operation of the Mortgaged Property, including        certificates of occupancy, apartment licenses, or the equivalent;               (3)  comply with all applicable laws that pertain to the maintenance and        disposition of tenant security deposits;              (4)   at all times maintain records sufficient to demonstrate compliance with the        provisions of this Section 6.02(e); and              (5)   promptly after receipt or notification thereof, provide Lender copies of any        building code or zoning violation from any Governmental Authority with respect to the        Mortgaged Property.  Section 6.03   Mortgage Loan Administration Matters Regarding the Property.        (a)   Property Management.        From and after the Effective Date, each property manager and each property management  agreement must be reasonably approved by Lender. If, in connection WIth the making of the  Mortgage Loan, or at any later date, Lender waives in writing the requirement that Borrower  enter into a written contract for management of the Mortgaged Property, and Borrower later  elects to enter into a written contract or change the management of the Mortgaged Property, such  new property manager or the property management agreement must be approved by Lender,  acting reasonably. As a condition to any approval by Lender, Lender may require that Borrower  and such new property manager enter into a collateral assignment of the property management  agreement on a form approved by Lender.        (b)   Subordination of Fees to Affiliated Property Managers.        Any  property manager that is a Borrower Affiliate to whom fees are payable for the  management  of the Mortgaged Property must enter into an assignment of management  agreement or other agreement with Lender, in a form approved by Lender, providing for  subordination of those fees and such other provisions as Lender may require.        (c)   Property Condition Assessment.        If, in connection with any inspection of the Mortgaged Property, Lender determines that  the condition of the Mortgaged Property has deteriorated (ordinary wear and tear excepted) since  the Effective Date, Lender may obtain, at Borrower's expense, a property condition assessment   Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 600t.NR                        PagelS  Article 6                                01-16                   C> 2016 Fannie Mae  

 

of the Mortgaged Property. Lender's right to obtain a property condition assessment pursuant to  this Section 6.03(c) shall be in addition to any other nghts available to Lender under this Loan  Agreement in connection with any such deterioration. Any such inspection or property condition  assessment may result in Lender requiring Additional Lender Repairs or Additional Lender  Replacements as further described in Section 13.02(a)(9)(B).                       ARTICLE 7 -   LEASES AND RENTS  Section 7.01   Representations and Warranties.         The representations and warranties made by Borrower to Lender in this Section 7.0 I are  made as of the Effective Date and are true and correct except as disclosed on the Exceptions to  Representations and Warranties Schedule.         (a)   Prior Assignment of Rents.         Borrower has not executed any:               (I)   prior assignment of Rents (other than an assignment of Rents securing        prior indebtedness that has been paid off and discharged or will be paid off and        discharged with the proceeds of the Mortgage Loan); or               (2)   instrument which would prevent Lender from exercising its rights under        this Loan Agreement or the Security Instrument.         (b)   Prepaid Rents.        Borrower has not accepted, and does not expect to receive prepayment of, any Rents for  more than two (2) months prior to the due dates of such Rents. Notwithstanding the foregoing,  Borrower may accept up to five percent (5%) of Rents more than two (2) months prior to, but not  more than twelve (12) months prior to, the due date of such Rents, provided that such prepaid  Rents shall not be recorded as income or distributed to Borrower's partners until such Rents are  actually earned.   Section 7.02   Covenants.         (a)   Leases.         Borrower shall:               (I)   comply  with and observe Borrower's obligations under all Leases,        including Borrower's obligations pertaining to the maintenance and disposition of tenant        security deposits;               (2) . surrender possession of the Mortgaged Property, including all Leases and        all security deposits and prepaid Rents, immediately upon appointment of a receiver or        Lender's entry upon and taking of possession and control of the Mortgaged Property, as        applicable;                (3)   require that all Residential Leases have initial lease terms of not less than        six (6) months and not more than twenty-four (24) months (provided, however, that up to        ten percent (10%) of the Residential Leases may have terms of less than six (6) months    Multifamily Loan and Security Agreement   (Non-Recourse)                      Form 6001.NR                        Page 29   Article 6                               01-16                   ~ 2016 Fannie Mae  

 

     but not less than one (1) month and, if customary in the applicable market for       properties comparable to the Mortgaged Property, Residential Leases with terms of less       than six (6) months (but in no case less than one (1) month) may be permitted with       Lender's prior written consent); and             (4)  promptly provide Lender a copy of any non-Residential Lease at the time       such Lease is executed (subject to Lender's consent rights for Material Commercial       Leases in Section 7.02(b)) and, upon Lender's written request, promptly provide Lender a       copy of any Residential Lease then in effect.       (b)   Commercial Leases.             (1)  With respect to Material Commercial Leases, Borrower shall not:                  (A)   enter into any Material Commercial Lease except with the prior             written consent of Lender not to be unreasonably withheld, delayed or             conditioned; or                  (8)   modify the terms of, extend, or terminate (other than pursuant to             the terms of the previously Lender approved Commercial Lease) any Material             Commercial Lease (includmg any Material Commercial Lease in eXIstence on             the Effective Date) without the prior written consent of Lender.             (2)  With respect to any non-Material Commercial Lease, Borrower shall not:                  (A)   enter into any non-Material Commercial Lease that materially             alters the use and type of operation of the premises subject to the Lease in effect             as of the Effective Date or reduces the number or size of residential units at the             Mortgaged Property; or                  (8)   modify the terms of any non-Material Commercial Lease             (including any non-Material Commercial Lease in existence on the Effective             Date) in any way that materially alters the use and type of operation of the             premises subject to such non-Material Commercial Lease in effect as of the             Effective Date, reduces the number or size of residential units at the Mortgaged             Property, or results in such non-Material Commercial Lease being deemed a             Material Commercial Lease.             (3)   With respect to any Material Commercial Lease or non-Material        Commercial Lease, Borrower shall use commercially reasonable efforts to cause the        applicable tenant to provide within ten (10) Business Days after a request by Borrower, a        certificate of estoppel, or if not provided by tenant within such ten (10) Business Day        period, Borrower shall provide such certificate of estoppel, certifying:                   (A)  that such Material Commercial Lease or non-Material Commercial             Lease is unmodified and in full force and effect (or if there have been             modifications, that such Material Commercial Lease or non-Material             Commercial Lease is in full force and effect as modified and stating the             modifications);                   (B)  the term of the Lease including any extensions thereto;    Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 30  Article 7                            01-16                 10 2016 Fannie Mae  

 

                (C)   the dates to which the Rent and any other charges hereunder have             been paid by tenant;                   (D)   the amount of any security deposit delivered to Borrower as             landlord;                   (E)   whether or not Borrower is in default (or whether any event or             condition exists which, with the passage of time, would constitute an event of             default) under such Lease;                    (F)  the address to which notices to tenant should be sent; and                   (0)  any other information as may be reasonably required by Lender.        (c)  Payment of Rents.        Borrower shall:             (I)   pay to Lender upon demand all Rents after an Event of Default has        occurred and is continuing;           •             (2)   cooperate with Lender's efforts in connection with the assignment of        Rents set forth in the Security Instrument; and             (3)   not accept Rent under any Lease (whether a Residential Lease or a non-       Residential Lease) for more than two (2) months in advance. Notwithstanding the        foregoing, Borrower may accept up to five percent (5%) of Rents more than two (2)        months prior to, but not more than twelve (12) months prior to, the due date of such        Rents, provided that such prepaid Rents shall not be recorded as income or distributed        to Borrower's partners until such Rents are actually earned.        (d)  Assignment of Rents.        Borrower shall not:             (1)   perform any acts nor execute any instrument that would prevent Lender        from exercising its rights under the assignment of Rents granted in the Security        Instrument or in any other Loan Document; nor             (2)   interfere with Lender's collection of such Rents.        (e)  Further Assignments of Leases and Rents.        Borrower shall execute and deliver any further assignments of Leases and Rents as  Lender may reasonably require.         (I)  Options to Purchase by Tenants.        No Lease (whether a Residential Lease or a non-Residential Lease) shall contain an  option to purchase, right of first refusal to purchase or right of first offer to purchase, except as  required by applicable law.     Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 31   Anicle 7                            01-16                 Q 2016 Fannie Mac  

 

Section 7.03 Mortgage Loan Administration Regarding Leases and Rents.       (a)   Material Commercial Lease Requirements.       Each Material Commercial Lease, including any renewal or extension of any Material  Cornmercial Lease in existence as of the Effective Date, shall provide, directly or pursuant to a  subordination, non-disturbance and attornment agreement approved by Lender, that:             (1)  the tenant shall, upon written notice from Lender after the occurrence of       an Event of Default, pay all Rents payable under such Lease to Lender;             (2)  such Lease and all rights of the tenant thereunder are expressly       subordinate to the lien of the Security Instrument;             (3)  the tenant shall attorn to Lender and any purchaser at a ForecJosure Event       (such attornment to be self-executing and effective upon acquisition of title to the       Mortgaged Property by any purchaser at a Foreclosure Event or by Lender in any       manner);             (4)  the tenant agrees to execute such further evidences of attornment as       Lender or any purchaser at a ForecJosure Event may from time to time request; and             (5)  such Lease shall not terminate as a result of a Foreclosure Event unless       Lender or any other purchaser at such Foreclosure Event affirmatively elects to terminate       such Lease pursuant to the terms of the subordination, non-disturbance and attornment       agreement.        (b)  Residential Lease Form.       All Residential Leases entered into from and after the Effective Date shall be on forms  approved by Lender.      ARTICLE 8 -  BOOKS AND    RECORDS; FINANCIAL REPORTING  Section 8.01  Representations and Warranties.        The representations and warranties made by Borrower to Lender in this Section 8.01 are  made as of the Effective Date and are true and correct except as discJosed on the Exceptions to  Representations and Warranties Schedule.        (a)  Financial Information.        To Borrower's knowledge, all financial statements and data, including statements of cash  flow and income and operating expenses, that have been delivered to Lender by Borrower or an  Affiliate of Borrower in respect of the Mortgaged Property:             (1)   are true, complete, and correct in all material respects; and             (2)   accurately represent the financial condition of the Mortgaged Property as        of such date.    Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 32  Article 7                            01-16                 10 2016 Fannie Mae  

 

      (b)   No Change in Facts or Circumstances.         All information in the Loan Application and in all financial statements, rent rolls, reports,  certificates, and other documents submitted in connection with the Loan Application are  complete and accurate in all material respects. There has been no material adverse change in any  fact or circumstance that would make any such information incomplete or inaccurate.   Section 8.02   Covenants.         (a)   Obligation to Maintain Accurate Books and Records.         Borrower shall keep and maintain at all times at the Mortgaged Property or the property  management agent's offices or Borrower's General Business Address and, upon Lender's written  request, shall make available at the Land:               (I)   complete and accurate books of account and records (including copies of        supporting bills and invoices) adequate to reflect correctly the operation of the Mortgaged        Property; and               (2)   copies of all written contracts, Leases, and other instruments that affect        Borrower or the Mortgaged Property.         (b)   Items to Furnish to Lender.         Borrower shall furnish to Lender the following, certified as true, complete, and accurate  in all material respects as of the date made (and that no material changes to the financial  condition of Borrower (or Guarantor, as applicable) or the Mortgaged Property have occurred  that are not reflected therein), by an individual having authority to bind Borrower (or Guarantor,  as applicable), acting in his or her capacity as an officer of Borrower (or Guarantor, as  apphcable), all in such form and with such detail as Lender reasonably requires:               (1)   within forty-five (45) days after the end of each first, second, and third        calendar quarter, a statement of income and expenses for Borrower on a year-to-date        basis as of the end of each calendar quarter;               (2)   within one hundred twenty (120) days after the end of each calendar year:                     (A)   for any Borrower and any Guarantor that is an entity, a statement              of income and expenses and a statement of cash flows for such calendar year;                      (B)   for any Borrower and  any Guarantor that is an individual, or a              trust established for estate-planning purposes, a personal financial statement for               such calendar year;                      (C)   when requested in writing by Lender, balance sheet(s) showing all              assets and liabilities of Borrower and Guarantor and a statement of all contingent               liabilities as of the end of such calendar year;                      (0)   if an energy consumption metric for the Mortgaged Property is               required to be reported to any Governmental Authority, the Fannie Mae Energy               Performance Metrics report, as generated by ENERGY STARI>  Portfolio               Manager, for the Mortgaged Property for such calendar year, which report must    Multlfamlty Loan and Security Agreement   (Non-Recourse)                       Form 6001.NR                        Page 33   Article 8                               01-16                   II) 2016 Fannie Mae  

 

           include the ENERGY STAR score, the Source Energy Use Intensity (EUI), the             month and year ending period for such ENERGY STAR score and such Source             Energy Use Intensity, and the ENERGY STAR Portfolio Manager Property             Identification Number; provided that, if the Governmental Authority does not             require the use of ENERGY STAR Portfolio Manager for the reporting of the             energy consumption metric and Borrower does not use ENERGY STAR             Portfolio Manager, then Borrower shall furnish to Lender the Source Energy Use             Intensity for the Mortgaged Property for such calendar year;                  (E)   a written certification ratifying and affirming that:                        (i)  Borrower has taken no action in violation of Section                  4.02(d) regarding its single asset status;                        (ii) Borrower has received no notice of any building code                  violation, or if Borrower has received such notice, evidence of remediation                  or that Borrower is pursuing remediation;                         (iii) Borrower has made no application for rezoning nor                  received any notice that the Mortgaged Property has been or is being                  rezoned; and                        (iv) Borrower has taken no action and has no knowledge of any                  action that would violate the provisions of Section 1 I.02(b)(I)(F)                  regarding liens encumbering the Mortgaged Property;                   (F)   an accountin~ of all security deposits held pursuant to all Leases,             including the name of the Institution (if any) and the names and identification             numbers of the accounts (if any) in which such security deposits are held and the             name of the person to contact at such financial institution, along with any             authority or release necessary for Lender to access information regarding such             accounts; and                   (G)  written confirmation of:                        (i)  any changes occurring since the Effective Date (or that no                   such changes have occurred since the Effective Date) in (I) the direct                   owners of Borrower, (2) the indirect owners (and any non-member                   managers) of Borrower that Control Borrower (excluding any Publicly­                  Held Corporations or Publicly-Held Trusts), or (3) the indirect owners of                   Borrower that hold twenty-five percent (25%) or more of the ownership                   interests in Borrower (excluding any Publicly-Held Corporations or                   Publicly-Held Trusts), and their respective interests, provided; however,                   that Borrower shall not be reqUired to identify the owners of any                   direct or indirect ownership interests in BREP other than the general                   partners of BREP;                        (ii)  the names of all officers and directors of (I) any Borrower                   which is a corporation, (2) any corporation which is a general partner of                   any Borrower which is a partnership, or (3) any corporation which is the                   managing member or non-member manager of any Borrower which is a                   limited liability company; and   Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 34  Article 8                            01-16                 «:J 2016 Fannie Mae  

 

                      (iii) the names of all managers who are not members of (1) any                  Borrower  which is a limited liability company, (2) any limited liability                  company which is a general partner of any Borrower which is a                  partnership, or (3) any limited liability company which is the managing                  member or non-member manager of any Borrower which is a limited                  liability company; and                  (H)   if not already provided pursuant to Section 8.02(b)(2)(A) above, a             statement of income and expenses for Borrower's operation of the Mortgaged             Property on a year-to-date basis as of the end of each calendar year;             (3)  within forty-five (45) days after the end of each first, second, and third       calendar quarter and within one hundred twenty (120) days after the end of each calendar       year, and at any other time upon Lender's written request, a rent schedule for the       Mortgaged Property showing the name of each tenant and for each tenant, the space       occupied, the lease expiration date, the rent payable for the current month, the date       through which rent has been paid, and any related information requested by Lender; and             (4)  upon Lender's written request (but, absent an Event of Default, no more       frequently than once in any six (6) month period):                  (A)   any item described in Section 8.02(b)(1) or Section 8.02(b)(2) for             Borrower, certified as true, complete, and accurate by an individual having             authority to bind Borrower;                  (B)   a property management or leasing report for the Mortgaged             Property, showing the number of rental applications received from tenants or             prospective tenants and deposits received from tenants or prospective tenants,             and any other information requested by Lender;                   (C)  a statement of income and expenses for Borrower's operation of             the Mortgaged Property on a year-to-date basis as of the end of each month for             such period as requested by Lender, which statement shall be delivered within             thirty (30) days after the end of such month requested by Lender;                    (0)  a statement of real estate owned directly or indirectly by Borrower             and Guarantor for such period as requested by Lender, which statement(s) shall             be delivered within thirty (30) days after the end of such month requested by             Lender; and                   (E)  a statement that identifies:                        (i)   the direct owners of Borrower and their respective interests;                         (ii)  the indirect owners (and any non-member managers) of                   Borrower that Control Borrower (excludin~ any Publicly-Held                   Corporations or Publicly-Held Trusts) and their respective interests,                   provided; however, that Borrower shall not be required to identify the                   owners of any direct or indirect ownership interests in BREP other than                   the general partners of BREP; and    Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 35  Article 8                            01-16                 «:'J 2016 Fannie Mae  

 

                      (iii) the indirect owners of Borrower that hold twenty-five                  percent (25%) or more of the ownership interests in Borrower (excluding                  any Publicly-Held Corporations or Publicly-Held Trusts) and their                  respective interests, provided; however, that Borrower shaB not be                  required to identify the owners of any direct or indirect ownership                  interests in BREP other than the general partners of BREP.       (c)   Audited Financials.       In the event Borrower or Guarantor receives or obtains any audited financial statements  and such financial statements are required to be delivered to Lender under Section 8.02(b),  Borrower shall deliver or cause to be delivered to Lender the audited versions of such financial  statements.       (d)   Delivery of Books and Records.       If an Event of Default has occurred and is continuing, Borrower shall deliver to Lender,  upon written demand, all books and records relating to the Mortgaged Property or its operation.  Section 8.03  Mortgage Loan Administration Matters Regarding Books and Records  and Financial Reporting.       (a)   Lender's Right to Obtain Audited Books and Records.       Lender may require that Borrower's or Guarantor's books and records be audited, at  Borrower's expense, by an independent certified public accountant selected by Lender in order to  produce or audit any statements,  schedules, and reports of Borrower, Guarantor, or the  Mortgaged Property required by Section 8.02, if:             (1)  Borrower or Guarantor fails to provide in a timely manner the statements,        schedules, and reports required by Section 8.02 and, thereafter, Borrower or Guarantor        fails to provide such statements, schedules, and reports within the cure period provided in        Section 14.01(c);             (2)   the statements, schedules, and reports submitted to Lender pursuant to        Section 8.02 are not fuB, complete, and accurate in all material respects as determined by        Lender and, thereafter, Borrower or Guarantor fails to provide such statements,        schedules, and reports within the cure period provided in Section 14.01 (c); or             (3)   an Event of Default has occurred and is continuing.        Notwithstanding the foregoing, the ability of Lender to require the delivery of audited  financial statements shall be limited to not more than once per Borrower's fiscal year so long as  no Event of Default has occurred during such fiscal year (or any event which, with the giving of  written notice or the passage of time, or both, would constitute an Event of Default has occurred  and is continuing). Borrower shall cooperate with Lender in order to satisfy the provisions of  this Section 8.03(a). All related costs and expenses of Lender shall become immediately due and  payable by Borrower within ten (10) Business Days after demand therefor.    Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 36  Article 8                            01-16                 II:> 2016 Fannie Mae  

 

      (b)   Credit Reports; Credit Score.        No more often than once in any twelve (12) month period, Lender is authorized to obtain  a credit report (if applicable) on Borrower or Guarantor, the cost of which report shall be paid by  Borrower. Lender is authorized to obtain a Credit Score (if applicable) for Borrower or  Guarantor at any time at Lender's expense.                           ARTICLE 9 -   INSURANCE  Section 9.01   Representations and Warranties.        The representations and warranties made by Borrower to Lender in this Section 9.01 are  made as of the Effective Date and are true and correct except as disclosed on the Exceptions to  Representations and Warranties Schedule.        (a)   Compliance with Insurance Requirements.        Borrower is in compliance with Lender's insurance requirements (or has obtained a  written waiver from Lender for any non-compliant coverage) and has timely paid all premiums  on all required insurance policies.        (b)   Property Condition.              (I)   The Mortgaged Property has not been damaged by fire, water, wind, or        other cause ofloss; or              (2)   if previously damaged, any previous damage to the Mortgaged Property        has been repaired and the Mortgaged Property has been fully restored.  Section 9.02   Covenants.        (a)   Insurance Requirements.              (I)   As required by Lender and applicable law, and as may be modified from        time to time, Borrower shall:                    (A)   keep the Improvements insured at all times against any hazards,              which insurance shall include coverage against loss by fire and all other perils              insured by the "special causes of loss" coverage form, general boiler and              machinery coverage, business income coverage, and flood (if any of the              Improvements are located in an area identified by the Federal Emergency              Management Agency (or any successor) as an area having special flood hazards              and to the extent flood insurance is available in that area), and may include              sinkhole insurance, mine subsidence insurance, earthquake insurance, terrorism               insurance, windstorm insurance and, if the Mortgaged Property does not conform              to applicable building, zoning, or land use laws, ordinance, and law coverage;                    (B)    maintain at all times commercial general liability insurance,              workmen's  compensation insurance, and such other liability, errors and              omissions, and fidelity insurance coverage; and    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                         Page 37  Article 8                                01-16                   02016 Fannie Mae  

 

                (C)   maintain builder's risk and public liability insurance, and other             insurance in connection with completing the Repairs or Replacements, as             applicable.       (b)   Delivery of Policies, Renewals, Notices, and Proceeds.       Borrower shall:             (1)  cause all insurance policies (including any policies not otherwise required       by Lender) which can be endorsed with standard non-contributing, non-reporting       mortgagee clauses making loss payable to Lender (or Lender's assigns) to be so       endorsed;             (2)  promptly deliver to Lender a copy of all renewal and other notices       received by Borrower with respect to the policies and all receipts for paid premiums;             (3)  deliver evidence, in form and content acceptable to Lender, that each       required insurance policy under this Article 9 has been renewed not less than ten (10)       days prior to the applicable expiration date, and (if such evidence is other than an original       or duplicate original of a renewal policy) deliver the original or duplicate original of each       renewal policy (or such other evidence of insurance as may be required by or acceptable       to Lender) in form and content acceptable to Lender within ninety (90) days after the        applicable expiration date of the original insurance policy;             (4)   provide immediate written notice to the insurance company and to Lender        of any event of loss;             (5)   execute such further evidence of assignment of any insurance proceeds as        Lender may require; and             (6)   provide immediate written notice to Lender of Borrower's receipt of any        insurance proceeds under any insurance policy required by Section 9.02(a)(l) above and,        if requested by Lender, deliver to Lender all of such proceeds received by Borrower to be        applied by Lender in accordance with this Article 9.  Section 9.03  Mortgage Loan Administration Matters Regarding Insurance        (a)  Lender's Ongoing Insurance Requirements.        Borrower acknowledges that Lender's insurance requirements may change from time to  time. All insurance policies and renewals of insurance policies required by this Loan Agreement  shall be:             (1)   in the form and with the terms required by Lender;             (2)   in such amounts, with such maximum deductibles and for such periods        required by Lender; and             (3)   issued by insurance companies satisfactory to Lender.        BORROWER   ACKNOWLEDGES     THAT  ANY  FAILURE  OF  BORROWER   TO  COMPLY   WITH THE REQUIREMENTS   SET FORTH  IN SECTION 9.02(a) OR SECTION   Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 38  Article 9                            01-16                 Ii:) 2016 Fannie Mae  

 

9.02(b)(3) ABOVE SHALL  PERMIT  LENDER   TO PURCHASE   THE  APPLICABLE  INSURANCE  AT  BORROWER'S   COST. SUCH  INSURANCE  MAY,  BUT NEED  NOT,  PROTECT BORROWER'S    INTERESTS. THE COVERAGE THAT LENDER PURCHASES  MAY  NOT  PAY ANY  CLAIM THAT  BORROWER   MAKES  OR ANY  CLAIM  THAT  IS  MADE AGAINST BORROWER IN    CONNECTION WITH THE MORTGAGED PROPERTY.  IF LENDER   PURCHASES   INSURANCE   FOR THE  MORTGAGED    PROPERTY   AS  PERMITTED HEREUNDER, BORROWER WILL BE RESPONSIBLE FOR THE      COSTS OF  THAT  INSURANCE,  INCLUDING  INTEREST  AT  THE DEFAULT   RATE AND  ANY  OTHER CHARGES   LENDER MAY   IMPOSE IN CONNECTION  WITH THE PLACEMENT  OF THE INSURANCE UNTIL THE EFFECTIVE DATE OF THE CANCELLATION OR THE  EXPIRATION  OF THE  INSURANCE.  THE  COSTS OF  THE INSURANCE  SHALL  BE  ADDED  TO BORROWER'S TOTAL    OUTSTANDING BALANCE   OR OBLIGATION  AND  SHALL   CONSTITUTE   ADDITIONAL   INDEBTEDNESS.    THE   COSTS  OF  THE  INSURANCE MAY BE MORE THAN THE COST OF    INSURANCE BORROWER MAY BE  ABLE  TO  OBTAIN   ON  ITS OWN.   BORROWER    MAY   LATER  CANCEL  ANY  INSURANCE  PURCHASED   BY LENDER,  BUT ONLY  AFTER  PROVIDING EVIDENCE  THAT  BORROWER    HAS OBTAINED   INSURANCE  AS REQUIRED   BY THIS LOAN  AGREEMENT AND THE OTHER LOAN DOCUMENTS.        (b)  Application DC Proceeds on Event DC Loss.             (I)   Upon an event oftoss, Lender may, at Lender's option:                   (A)  hold such proceeds to be applied to reimburse Borrower for the             cost of Restoration (in accordance with Lender's then-current policies relating to             the restoration of casualty damage on similar multifamily residential properties);             or                   (B)  apply such proceeds to the payment of the Indebtedness, whether             or not then due; provided, however, Lender shall not apply insurance proceeds to             the payment of the Indebtedness and shall permit Restoration pursuant to Section             9.03(b)(I)(A) if all of the following conditions are met:                        (i)   no Event of Default has occurred and is continuing (or any                   event which, with the giving of written notice or the passage of time, or                   both, would constitute an Event of Default has occurred and is                   continuing);                        (ii)  Lender determines that the combination of insurance                   proceeds and amounts provided by Borrower will be sufficient funds to                   complete the Restoration;                        (iii) Lender determines that the net operating income generated                   by the Mortgaged Property after completion of the Restoration will be                   sufficient to support a debt service coverage ratio not less than the debt                   service coverage ratio immediately prior to the event of loss, but in no                   event less than 1.0x (the debt service coverage ratio shall be calculated on                   a thirty (30) year amortizing basis (if applicable, on a proformq basis                   approved by Lender) in all events and shall include all operating costs and                   other expenses, Imposition Deposits, deposits to Collateral Accounts, and                   Mortgage Loan repayment obligations);     Multifamily Loan and Security Agreement   (Non-Recourse)                   Form 6001.NR                     Page 39   Article 9                           01-16                 C 2016 Fannie Mae  

 

                        (iv)  Lender  determines that  the Restoration will be                    completed before the earlier of (1) one year before the stated Maturity                    Date, or (2) one year after the date of the loss or casualty; and •                          (v)   Borrower provides Lender, upon written request, evidence                    of the availability during and after the Restoration of the insurance                    required to be maintained by Borrower pursuant to this Loan Agreement.              After the completion of Restoration in accordance with the above requirements, as              determined by Lender, the balance, if any, of such proceeds shall be returned to              Borrower.              (2)   Notwithstanding the foregoing, if any loss is estimated to be in an amount        equal to or less than $250,000, Lender shall not exercise its rights and remedies as power­       of-attorney herein and shall allow Borrower to make proof of loss, to adjust and        compromise any claims under policies of property damage insurance, to appear in and        prosecute any action arising from such poliCIes of property damage insurance, and to        collect and receive the proceeds of property damage insurance; provided that each of the        following conditions shall be satisfied:                    (A)   Borrower shall immediately notify Lender of the casualty giving              rise to the claim;                    (B)   no Event of Default has occurred and is continuing (or any event              which, with the giving of written notice or the passage of time, or both, would              constitute an Event of Default has occurred and is continuing);                     (C)   the Restoration will be completed before the earlier of (i) one year              before the stated Maturity Date, or (ii) one year after the date of the 1055 or              casualty;                     (0)   Lender determines that the combination of insurance proceeds and              amounts  provided by Borrower will be sufficient funds to complete the              Restoration;                     (E)   all proceeds of property damage insurance shall be issued in the              form ofjoint  checks to Borrower and Lender;                    (F)   all proceeds of property damage insurance shall be applied to the              Restoration;                     (0)    Borrower shall deliver to Lender evidence satisfactory to Lender              of completion of the Restoration and obtainment of all lien releases;                     (H)    Borrower shall have complied to Lender's satisfaction with the               foregoing requirements on any prior claims subject to this provision, if any; and                      (1)   Lender shall have the right to inspect the Mortgaged Property               (subject to the rights of tenants under the Leases).               (3)   If Lender elects to apply insurance proceeds to the Indebtedness in        accordance with the terms of this Loan Agreement, Borrower shall not be obligated to    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                         Page 40  Article 9                                01-16                   iCl2016 Fannie Mae  

 

      restore or repair the Mortgaged Property. Rather, Borrower shall restrict access to the        damaged portion of the Mortgaged Property and, at its expense and regardless of whether        such costs are covered by insurance, clean up any debris resulting from the casualty        event, and, if required or otherwise permitted by Lender, demolish or raze any remaining        part of the damaged Mortgaged Property to the extent necessary to keep and maintain the        Mortgaged Property in a safe, habitable, and marketable condition. Nothing in this        Section 9.03(b) shall affect any of Lender's remedial rights against Borrower in        connection with a breach by Borrower of any of its obligations under this Loan        Agreement or under any Loan Document, including any failure to timely pay Monthly        Debt Service Payments or maintain the insurance coverage(s) required by this Loan        Agreement.        (c)   Payment Obligations Unaffected.        The application of any insurance proceeds to the Indebtedness shall not extend or  postpone the Maturity Date, or the due date or the full payment of any Monthly Debt Service  Payment, Monthly Replacement Reserve Deposit, or any other installments referred to in this  Loan Agreement or in any other Loan Document. Notwithstanding the foregoing, if Lender  applies insurance proceeds to the Indebtedness in connection with a casualty of less than the  entire Mortgaged Property, and after such application of proceeds the debt service coverage ratio  (as determined by Lender) is less than 1.25x based on the then-applicable Monthly Debt Service  Payment and the anticipated on-going net operating income of the Mortgaged Property after such  casualty event, then Lender may, at its discretion, permit an adjustment to the Monthly Debt  Service Payments that become due and owing thereafter, based on Lender's then-current  underwriting requirements. In no event shall the preceding sentence obligate Lender to make  any adjustment to the Monthly Debt Service Payments.        (d)   Foreclosure Sale.        If the Mortgaged Property is transferred pursuant to a Foreclosure Event or Lender  otherwise acquires title to the Mortgaged Property, Borrower acknowledges that Lender shall  automatically succeed to all rights of Borrower in and to any insurance policies and unearned  insurance premiums applicable to the Mortgaged Property and in and to the proceeds resulting  from any damage to the Mortgaged Property prior to such Foreclosure Event or such acquisition.        (e)   Appointment of Lender as Attorney-In-Fact.        Borrower hereby authorizes and appoints Lender as attorney-in-fact pursuant to Section  14.03(c).                        ARTICLE 10 -   CONDEMNATION  Section 10.01   Representations and Warranties.        The representations and warranties made by Borrower to Lender in this Section 10.0 I are  made as of the Effective Date and are true and correct except as disclosed on the Exceptions to  Representations and Warranties Schedule.         (a)   Prior Condemnation Action.        No part of the Mortgaged Property has been taken in connection with a Condemnation  Action.    Multifamily Loan and SecurIty Agreement   (Non-Recourse)                       Form 6001.NR                        Page 41   Article 9                               01-16                   1t'l2016 Fannie Mae  

 

     (b)   Pending Condemnation Actions.       No Condemnation Action is pending nor, to Borrower's knowledge, is threatened for the  partial or total condemnation or taking of the Mortgaged Property.  Section 10.02 Covenants.       (a)   Notice of Condemnation.       Borrower shall:             (1)  promptly notify Lender of any Condemnation Action of which Borrower       has knowledge;             (2)  appear in and prosecute or defend, at its own cost and expense, any action       or proceeding relating to any Condemnation Action, including any defense of Lender's       interest in the Mortgaged Property tendered to Borrower by Lender, unless otherwise       directed by Lender in writing; and             (3)  execute such further evidence of assignment of any condemnation award       in connection with a Condemnation Action as Lender may require.       (b)   Condemnation Proceeds.       Borrower shall pay to Lender all awards or proceeds of a Condemnation Action promptly  upon receipt.  Section 10.03 Mortgage Loan Administration Matters Regarding Condemnation.       (a)   Application of Condemnation Awards.       Lender may apply any awards or proceeds of a Condemnation Action, after the deduction  of Lender's expenses incurred in the collection of such amounts, to:             (1)  the restoration or repair of the Mortgaged Property, if applicable;             (2)  the payment of the Indebtedness, with the balance, if any, paid to        Borrower; or             (3)   Borrower.        (b)  Payment Obligations Unaffected.        The application of any awards or proceeds of a Condemnation Action to the Indebtedness  shall not extend or postpone the Maturity Date, or the due date or the full payment of any  Monthly Debt Service Payment, Monthly Replacement  Reserve Deposit, or any other  installments referred to in this Loan Agreement or in any other Loan Document.        (c)  Appointment of Lender as Attorney-In-Fact.        Borrower hereby authorizes and appoints Lender as attorney-in-fact pursuant to Section  14.03(c).   Multifamily Loan and Seeurity Agreement  (Non-Recourse)                    Form 6001.NR                     Page 42  Article 10                           01-16                 10 2016 Fannie Mae  

 

     (d)   Preservation of Mortgaged Property.       If a Condemnation Action results in or from damage to the Mortgaged Property and  Lender elects to apply the proceeds or awards from such Condemnation Action to the  Indebtedness in accordance with the terms of this Loan Agreement, Borrower shall not be  obligated to restore or repair the Mortgaged Property. Rather, Borrower shall restrict access to  any portion of the Mortgaged Property which has been damaged or destroyed in connection with  such Condemnation Action and, at Borrower's expense and regardless of whether such costs are  covered by insurance, clean up any debris resulting in or from the Condemnation Action, and, if  required by any Governmental Authority or otherwise permitted by Lender, demolish or raze any  remaining part of the damaged Mortgaged Property to the extent necessary to keep and maintain  the Mortgaged Property in a safe, habitable, and marketable condition. Nothing in this Section  1O.03(d) shall affect any of Lender's remedial rights against Borrower in connection with a  breach by Borrower of any of its obligations under this Loan Agreement or under any Loan  Document, including any failure to timely pay Monthly Debt Service Payments or maintain the  insurance coverage(s) required by this Loan Agreement.          ARTICLE 11  - LIENS, TRANSFERS, AND ASSUMPTIONS  Section 11.01 Representations and Warranties.       The representations and warranties made by Borrower to Lender in this Section 11.01 are  made as of the Effective Date and are true and correct except as disclosed on the Exceptions to  Representations and Warranties Schedule.       (a)   No Labor or Materialmen's Claims.       All parties furnishing labor and materials on behalf of Borrower have been paid in full.  There are no mechanics' or materialmen's liens (whether filed or unfiled) outstanding for work,  labor, or materials (and no claims or work outstanding that under applicable law could give rise  to any such mechanics' or materialmen's liens) affecting the Mortgaged Property, whether prior  to, equal with, or subordinate to the lien of the Security Instrument.        (b)  No Other Interests.       No Person:             (1)   other than Borrower has any possessory ownership or interest in the        Mortgaged Property or right to occupy the same except under and pursuant to the        provisions of existing Leases, the material terms of all such Leases having been        previously disclosed in writing to Lender; nor             (2)   has an option, right of first refusal, or right of first offer (except as        required by applicable law) to purchase the Mortgaged Property, or any interest in the        Mortgaged Property.  Section 11.02 Covenants.        (a)  Liens; Encumbrances.        Borrower shall not permit the grant, creation, or existence of any Lien, whether  voluntary, involuntary, or by operation of law, on all or any portion of the Mortgaged Property   Multlramlly Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 43  Article 10                           01-16                 II:) 2016 Fannie Mae  

 

(including any voluntary, elective, or non-compulsory tax lien or assessment pursuant to a  voluntary, elective, or non-compulsory special tax district or similar regime) other than:               (I)   Permitted Encumbrances;              (2)   the creation of:                    (A)   any tax  lien, municipal lien, utility lien, mechanics' lien,              materialmen's lien, or judgment lien against the Mortgaged Property if bonded              off, released of record, or otherwise remedied to Lender's satisfaction within              sixty (60) days after the earlier of the date Borrower has actual notice or              constructive notice of the existence of such lien; or                    (B)   any mechanics' or materialmen's liens which attach automatically              under the laws of any Govemmental Authority upon the commencement of any              work upon, or delivery of any materials to, the Mortgaged Property and for which              Borrower is not delinquent in the payment for any such work or materials; and               (3)   the lien created by the Loan Documents.        (b)   Transfers.              (1)   Mortgaged Property.              Borrower shall not Transfer, or cause or permit a Transfer of, all or any part of the        Mortgaged Property (including any interest in the Mortgaged Property) other than:                    (A)   a Transfer to which Lender has consented in writing;                     (B)   Leases permitted pursuant to the Loan Documents;                    (C)   [reserved];                     (D)   a Transfer of obsolete or worn out Personalty or Fixtures that are              contemporaneously replaced by items of equal or better function and quality              which are free of Liens (other than those created by the Loan Documents);                    (E)   the grant of an easement, right of way, servitude, or restrictive              covenant to which Lender has consented, and Borrower has paid to Lender, upon              demand, all costs and expenses incurred by Lender in connection with reviewing              Borrower's request;                    (F)   a  lien permitted pursuant to Section 11.02(a) of this Loan              Agreement; or                    (G)   the  conveyance of  the Mortgaged  Property following a              Foreclosure Event.              (2)   Interests in Borrower, Key Principal, or Guarantor.              Other than a Transfer to which Lender has consented in writing, Borrower shall        not Transfer, or cause or permit to be Transferred:   Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 44  Article I I                              01-16                   10 2016 Fannie Mae  

 

                  (A)   any direct or indirect ownership interest in Borrower, Key              Principal, or Guarantor (if applicable) if such Transfer would cause a change in              Control;                     (B)   a direct or indirect Restricted Ownership Interest in Borrower,              Key Principal, or Guarantor (if applicable);                     (C)   fifty percent (50%) or more of Key Principal's or Guarantor's              direct or indirect ownership interests in Borrower that existed on the Effective              Date (individually or on an aggregate basis);                     (0)   the economic benefits or ri~hts to cash flows attributable to any              ownership interests in Borrower, Key Pnncipal, or Guarantor (if applicable)              separate from the Transfer of the underlying ownership interests if the Transfer              of the underlying ownership interest is prohibited by this Loan Agreement; or                     (E)   a Transfer to a new key principal or new guarantor (if such new              key principal or guarantor is an entity), which entity has an organizational              existence termination date that ends before the Maturity Date.         Notwithstanding the foregoing, if a Publicly-Held Corporation or a Publicly-Held Trust        Controls Borrower, Key Principal, or Guarantor, or owns a direct or indirect Restricted        Ownership Interest in Borrower, Key Principal, or Guarantor, a Transfer of any        ownership interests in such Publicly-Held Corporation or Publicly-Held Trust shall not be        prohibited under this Loan Agreement as long as (i) such Transfer does not result in a        conversion of such Publicly-Held Corporation or Publicly-Held Trust to a privately held        entity, and (ii) Borrower provides written notice to Lender not later than thirty (30) days        thereafter of any such Transfer that results in any Person owning ten percent (10%) or        more of the ownership interests in such Publicly-Held Corporation or Publicly-Held        Trust.              (3)   Name Change or Entity Conversion.              Lender shall consent to Borrower changing its name, changing its jurisdiction of        organization, or converting from one type of legal entity into another type of legal entity        for any lawful purpose, provided that:                    (A)   Lender receives written notice at least thirty (30) days prior to              such change or conversion, which notice shall include organizational charts that              reflect the structure of Borrower both prior to and subsequent to such name              change or entity conversion;                    (B)   such Transfer is not otherwise prohibited under the provisions of              Section 11.02(b)(2);                     (C)   Borrower executes an amendment to this Loan Agreement and any              other Loan Documents required by Lender documenting the name change or              entity conversion;                     (0)   Borrower agrees and acknowledges, at Borrower's expense, that              (i) Borrower will execute and record in the land records any instrument required              by the Property Jurisdiction to be recorded to evidence such name change or   Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 45  Article II                               01-16                   C> 2016 Fannie Mac  

 

           entity conversion (or provide Lender with written confinnation from the title             company (via electronic mail or letter) that no such instrument is required), (ii)             Borrower wilJ execute any additional documents required by Lender, including             the amendment to this Loan Agreement, and allow such documents to be             recorded or filed in the land records of the Property Jurisdiction, (iii) Lender wilJ             obtain a "date down" endorsement to the Lender's Title Policy (or obtain a new             Title Policy if a "date down" endorsement is not available in the Property             Jurisdiction), evidencing title to the Mortgaged Property being in the name of the             successor entity and the Lien of the Security Instrument against the Mortgaged             Property, and (iv) Lender wilJ file any required UCC-3 financing statement and             make any other filing deemed necessary to maintain the priority of its Liens on             the Mortgaged Property; and                   (E)   no later than ten (10) days subsequent to such name change or             entity conversion, Borrower shall provide Lender (i) the documentation filed             with the appropriate office in Borrower's state of fonnation evidencing such             name change or entity conversion, (ii) copies of the organizational documents of             Borrower, including any amendments, filed with the appropriate office in             Borrower's state of fonnation reflectin~ the post-conversIon Borrower name,             fonn of organization, and structure, and (Iii) if available, new certificates of good             standing or valid fonnation for Borrower.             (4)  No Delaware Statutory Trust or Series LLC Conversion.             Notwithstanding any provisions herein to the contrary, no Borrower, Guarantor,       or Key Principal shall convert to a Delaware Statutory Trust or a series limited liability       company.       (e)   No Other Indebtedness.       Other than the Mortgage Loan, Borrower shall not incur or be obligated at any time with  respect to any loan or other indebtedness (except trade payables as otherwise pennitted in this  Loan Agreement), including any indebtedness secured by a Lien on, or the cash flows from, the  Mortgaged Property.        (d)  No Mezzanine Financing or Preferred Equity.       Neither Borrower nor any direct or indirect owner of Borrower shall: (1) incur any  Mezzanine Debt other than Pennitted Mezzanine Debt; (2) issue any Preferred Equity other than  Pennitted Preferred Equity; or (3) incur any similar indebtedness or issue any similar equity.  Section 11.03 Mortgage Loan Administration Matters Regarding Liens, Transfers, and  Assumptions        (a)  Assumption of Mortgage Loan.        Lender shall consent to a Transfer of the Mortgaged Property to and an assumption of the  Mortgage Loan by a new borrower if each of the following conditions is satisfied prior to the  Transfer:             (1)   Borrower has submitted to Lender all infonnation required by Lender to        make the detennination required by this Section 11.03(a);   Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 46  Article II                           01-16                 ~ 2016 Fannie Mae  

 

            (2)   no Event of Default has occurred and is continuing, and no event which,        with the giving of written notice or the passage of time, or both, would constitute an        Event of Default has occurred and is continuing;              (3)   Lender determines that:                    (A)   the proposed new borrower, new key principal, and any other new              guarantor fully satIsfy all of Lender's then-applicable borrower, key principal, or              guarantor eligibility, credit, management, and other loan underwriting standards,              which shall include an analysis of (i) the previous relationships between Lender              and the proposed new borrower, new key principal, new guarantor, and any              Person in Control of them, and the organization of the new borrower, new key              principal, and new guarantor (if applicable), and (ii) the operating and financial              performance of the Mortgaged Property, including physical condition and              occupancy;                    (B)   none of the proposed new borrower, new key principal, and any              new guarantor, or any owners of the proposed new borrower, new key principal,              and any new guarantor, are a Prohibited Person; and                    (C)   none of the proposed new borrower, new key principal, and any              new guarantor (if any of such are entities) shall have an orgaruzational existence              termination date that ends before the Maturity Date;              (4)   [reserved];              (5)   the proposed new borrower has:                    (A)   executed an assumption agreement acceptable to Lender that,              among other things, requires the proposed new borrower to assume and perform              all obligations of Borrower (or any other transferor), and that may require that              the new borrower comply with any provisions of any Loan Document that              previously may have been waived by Lender for Borrower, subject to the terms              of Section 11.03(g);                    (B)   if required by Lender, delivered to the Title Company for filing              and/or recording in all applicable jurisdictions, all applicable Loan Documents              including the assumption agreement to correctly evidence the assumption and the              confirmation, continuation, perfection, and priority of the LIens created              hereunder and under the other Loan Documents; and                     (C)   delivered to Lender a "date-down" endorsement to the Title Policy              acceptable to Lender (or a new title insurance policy if a "date-down"              endorsement is not available);              (6)   one or more individuals or entities acceptable to Lender as new guarantors        have executed and delivered to Lender:                    (A)   an assumption agreement acceptable to Lender that requires the              new  guarantor to assume and perform all obligations of Guarantor under any              Guaranty given in connection WIth the Mortgage Loan; or    Multlramlly Loan and Security Agreement  (Non-Rccourse)                       Form 6001.NR                        Page 47  Article II                               01-16                   Cl 2016 Fannie Mae  

 

                (B)   a substitute Non-Recourse Guaranty and other substitute guaranty             in a fonn acceptable to Lender;             (7)  Lender has reviewed and approved the Transfer documents; and              (8)  Lender has received the fees described in Section 11.03(g).       (b)   Transfers to Key Principal-Owned Affiliates or Guarantor-Owned Affiliates.              (1)  Except as otherwise covered in Section 11.03(b)(2) below, Transfers of       direct or indirect ownership interests in Borrower to Key Principal or Guarantor, or to a       transferee through which Key Principal or Guarantor (as applicable) Controls Borrower       with the same rights and abilities as Key Principal or Guarantor (as applicable) Controls       Borrower immediately prior to the date of such Transfer, shall be consented to by Lender       if:                  (A)   such Transfer satisfies the applicable requirements of Section             11.03(a), other than Section 11.03(a)(5); and                   (B)   after giving effect to any such  Transfer, each Key Principal or             Guarantor (as applicable) continues to own not less than fifty percent (50%) of             such Key Principal's or Guarantor's (as applicable) direct or indirect ownership             interests in Borrower that existed on the Effective Date.             (2)  Transfers of direct or indirect interests in Borrower held by a Key       Principal or Guarantor to other Key Principals or Guarantors, as applicable, shall be       consented to by Lender if such Transfer satisfies the following conditions:                  (A)   the Transfer does not cause a change in the Control of Borrower;             and                   (B)   the transferor Key Principal or Guarantor maintains the same right             and ability to Control Borrower as existed prior to the Transfer.  If the conditions set forth in this Section 11.03(b) are satisfied, the Transfer Fee shall be waived  provided Borrower shall pay the Review Fee and out-of-pocket costs set forth in Section  11.03(g).        (c)  Estate Planning.        Notwithstanding the provisions of Section 11.02(b )(2), so long as (1) the Transfer does  not cause a change in the Control of Borrower, and (2) Key Principal and Guarantor, as  applicable, maintain the same right and ability to Control Borrower as existed prior to the  Transfer, Lender shall consent to Transfers of direct or indirect ownership interests 10 Borrower  and Transfers of direct or indirect ownership interests in an entity Key Principal or entity  Guarantor to:                   (A)  Immediate Family Members of such transferor, each of whom             must have obtained the legal age of majority;                    (B)  United States domiciled trusts established for the benefit of the             transferor or Immediate Family Members of the transferor; or   Multlramily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 48  Article II                           01-16                 \!:) 2016 Fannie Mae  

 

                (C)   partnerships or limited liability companies of which the partners             or members, respectively, are comprised entirely of (i) such transferor and             Immediate Family Members (each of whom must have obtained the legal age of             majority) of such transferor, (ii) Immediate Family Members (each of whom             must have obtained the legal age of majority) of such transferor, or (iii) United             States domiciled trusts established for the benefit of the transferor or Immediate             Family Members of the transferor.  If the conditions set forth in this Section 11.03(c) are satisfied, the Transfer Fee shall be waived  provided Borrower shall pay the Review Fee and out-of-pocket costs set forth in Section  11.03(g).       (d)   Termination or Revocation of Trust.       If any of Borrower, Guarantor, or Key Principal is a trust, or if Control of Borrower,  Guarantor, or Key Principal is Transferred or if a Restricted Ownership Interest in Borrower,  Guarantor, or Key Principal would be Transferred due to the termination or revocation of a trust,  the termination or revocation of such trust is an unpermitted Transfer; provided that the  termination or revocation of the trust due to the death of an individual trustor shall not be  considered an unpermitted Transfer so long as:             (1)  Lender is notified within thirty (30) days of the death; and             (2)  such Borrower, Guarantor, Key Principal, or other Person, as applicable, is       replaced with an individual or entity acceptable to Lender, in accordance with the       provisions of Section 1 1.03 (a) within ninety (90) days of the date of the death causing the       termination or revocation.  If the conditions set forth in this Section 11.03(d) are satisfied, the Transfer Fee shall be waived;  provided Borrower shall pay the Review Fee and out-of-pocket costs set forth in Section  11.03(g).        (e)  Death of Key Principal or Guarantor; Transfer Due to Death.             (1)   If a Key Principal or Guarantor that is a naturaJ person dies, or if Control        of Borrower, Guarantor, or Key Principal is Transferred, or if a Restricted Ownership        Interest in Borrower, Guarantor, or Key Principal would be Transferred as a result of the        death of a Person (except in the case of trusts which is addressed in Section 11.03(d»,        Borrower must notifY Lender in writing  within ninety (90) days in the event of such        death. Unless waived in writing by Lender, the deceased shall be replaced by an        individual or entity within one hundred eighty (180) days, subject to Borrower's        satisfaction of the following conditions:                   (A)  Borrower has submitted to Lender all information required by             Lender to make the determination required by this Section Il.03(e);                    (B)  Lender determines that, if applicable:                        (i)   any proposed new key principal and  any other new                   guarantor (or Person Controlling such new key principal or new guarantor)                   fully satisfies all of Lender's then-applicable key principal or guarantor                   eligibility, credit, management, and other loan underwriting standards   Multlramlly Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 49  Article II                           01-16                 "2016 Fannie Mae  

 

                (including any standards with respect to previous relationships between                  Lender and the proposed new key principal and new guarantor (or Person                  Controlling such new key principal or new guarantor) and the organization                  of the new key principal and new guarantor);                         (ii) none of any proposed new key principal or any new                  guarantor, or any owners of the proposed new key principal or any new                  guarantor, is a Prohibited Person; and                         (iii) none of any proposed new key principal or any new                  guarantor (if any of such are entities) shall have an organizational                  existence tennination date that ends before the Maturity Date; and                  (C)   if applicable, one or more individuals or entities acceptable to             Lender as new guarantors have executed and delivered to Lender:                        (i)  an assumption agreement acceptable to Lender that requires                  the new guarantor to assume and perfonn all obligations of Guarantor                  under any Guaranty given in connection with the Mortgage Loan; or                         (ii) a substitute Non-Recourse Guaranty and other substitute                  guaranty in a fonn acceptable to Lender.              (2)  In the event a replacement Key Principal, Guarantor, or other Person is       required by Lender due to the death described in this Section 11.03( e), and such       replacement has not occurred within such period, the period for replacement may be       extended by Lender to a date not more than one year from the date of such death;       however, Lender may require as a condition to any such extension that:                  (A)   the then-current property manager be replaced with a property             manager reasonably acceptable to Lender (or if a property manager has not been             previously engaged, a property manager reasonably acceptable to Lender be             engaged); or                  (B)   a lockbox agreement or similar cash management arrangement             (with the property manager) reasonably acceptable to Lender during such             extended replacement period be instituted.  If the conditions set forth in this Section 11.03( e) are satisfied, the Transfer Fee shall be waived,  provided Borrower shall pay the Review Fee and out-of-pocket costs set forth in Section  11.03(g).        (t)  Bankruptcy of Guarantor.             (1)   Upon the occurrence of any Guarantor Bankruptcy Event, unless waived        in writing by Lender, the applicable Guarantor shall be replaced by an individual or entity        within ninety (90) days of such Guarantor Bankruptcy Event, subject to Borrower's        satisfaction of the following conditions:                   (A)  Borrower has submitted to Lender all infonnation required by             Lender to make the detennination required by this Section 11.03(t);    Multlramily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page SO  Article II                           01-16                 II:) 2016 Fannie Mae  

 

                  (B)   Lender determines that:                          (i)   the proposed new guarantor fully satisfies all of Lender's                    then-applicable guarantor eligibility, credit, management, and other loan                    underwriting standards (including any standards with respect to previous                    relationships between Lender and the proposed new guarantor and the                    organization of the new guarantor (if applicable»;                           (ii)  no new guarantor is a Prohibited Person; and                           (iii) no new guarantor (if any of such are entities) shall have an                    organizational existence termination date that ends before the Maturity                    Date; and                    (C)   one or more individuals or entities acceptable to Lender as new              guarantors have executed and delivered to Lender:                          (i)   an assumption agreement acceptable to Lender that requires                    the new guarantor to assume and perform all obligations of Guarantor                    under any Guaranty given in connection with the Mortgage Loan; or                           (ii)  a substitute Non-Recourse Guaranty and other substitute                    guaranty in a form acceptable to Lender.               (2)   In the event a replacement Guarantor is required by Lender due to the        Guarantor Bankruptcy Event described in this Section 11.03(f), and such replacement has        not occurred withtn such period, the period for replacement may be extended by Lender        in its discretion; however, Lender may require as a condition to any such extension that:                    (A)   the then-current property manager be replaced with a property              manager reasonably acceptable to Lender (or if a property manager has not been              previously engaged, a property manager reasonably acceptable to Lender be              engaged); or                    (B)   a lockbox agreement or similar cash management arrangement              (with the property manager) reasonably acceptable to Lender during such              extended replacement period be instituted.  If the conditions set forth in this Section 11.03(f) are satisfied, the Transfer Fee shall be waived,  provided Borrower shall pay the Review Fee and out-of-pocket costs set forth in Section  11.03(g).        (g)   Further Conditions to Transfers and Assumption.              (I)   In connection with any Transfer of the Mortgaged Property, or an        ownership interest in Borrower, Key Principal, or Guarantor for which Lender's approval        is required under this Loan Agreement (including Section 11.03(a», Lender may, as a        condition to any such approval, require:                    (A)   additional collateral, guaranties, or other credit support to mitigate              any risks concerning the proposed transferee or the performance or condition of              the Mortgaged Property;   Multlramlly Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        PageSl  Article II                               01-16                   Cl2016 Fannie Mae  

 

                (B)   amendment of the Loan Documents to delete or modify any             specially negotiated terms or provisions previously granted for the exclusive             benefit of original Borrower, Key Principal, or Guarantor and to restore the             original provisions of the standard Fannie Mae form multifamily loan             documents, to the extent such provisions were previously modified; or                  (C)   a modification to the amounts required to be deposited into the             Reserve/Escrow Account pursuant to the terms of Section 13.02{a){3)(B).             (2)  In connection with any request by Borrower for consent to a Transfer,       Borrower shall pay to Lender upon demand:                  (A)   the Transfer Fee (to the extent charged by Lender);                  (B)   the Review Fee (regardless of whether Lender approves or denies             such request); and                  (C)   all of Lender's out-of-pocket costs (including reasonable             attorneys' fees) incurred in reviewing the Transfer request, regardless of whether             Lender approves or denies such request.       (b)   Additional Permitted Transfers.        In connection with any Transfer pursuant to this Section 11.03(h), each of the following  must be true at all relevant times during which the Indebtedness evidenced by this Loan  Agreement is outstanding and no Transfer can result in the following ceasing to be true:              (i)  BREP  directly or indirectly shall (x) wholly Control the Guarantor; (y)       continue to own directly or indirectly more than 50% of the ownership interests of       Guarantor; and (z) continue to own directly or indirectly more than 50% of the ownership        interests in Borrower;              (ii) Guarantor directly or indirectly shall continue to own directly or        indirectly more than 50% of the ownership interests of Borrower;              (iii) No direct or indirect owner of Borrower or Guarantor shall be a BREP        Prohibited Person, provided that the BREP Prohibited Person requirements shall not        apply to any transferee or successor of The Blackstone Group L.P. or any holder of a        non-Controlling limited partnership interest in BREP; provided further that paragraph (c)        of the definition of BREP Prohibited Person shall not apply to BREP; and             (iv)  Blackstone Real Estate Holdings VIII-ESC L.P. and Blackstone        Family Real Estate Partnership VIII-SMD L.P., collectively, shall not, directly or        indirectly, own more than 10% of Guarantor or Borrower.        Provided that clauses (i) - (iv) above are true, notwithstanding anything to the        contrary in Section l1.02{b), the following may occur from time to time without the        need to obtain consent from Lender:                   (i)  Transfers of direct or indirect ownership interests in BREP             provided however that in the event substantially all of the assets of BREP at   Multifamily Loan ond Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 52  Article II                           01-16                 10 2016 Fannie Mae  

 

            the time of any such ownership interest Transfer are Multifamily Residential              Properties and such Transfer involves the sale of (x) only  BREP ownership              interests, or (y) BREP ownership interests in conjunction with ownership              interests of other affiliates of The Blackstone Group, L.P. that own              substantially all Multifamily Residential Properties, then any ownership interest              Transfer  that would cause a change in the direct or indirect ownership              interest of the general partner interests in BREP requires Lender's consent              pursuant to the tenns of Section 11.03(a) of this Loan Agreement.                     (ii)  Transfers by Guarantor of direct or indirect ownership interests in              Borrower.                     (iii) Transfers by BREP of direct or indirect ownership interests in              Guarantor.                          ARTICLE 12 -   IMPOSITIONS  Section 12.01  Representations and Warranties.        The representations and warranties made by Borrower to Lender in this Section 12.0 I are  made as of the Effective Date and are true and correct except as disclosed on the Exceptions to  Representations and Warranties Schedule.        (a)   Payment of Taxes, Assessments, and Other Charges.              Borrower has:              (1)   paid (or with the approval of Lender, established an escrow fund sufficient        to pay when due and payable) all amounts and charges relating to the Mortgaged Property        that have become due and payable before any fine, penalty interest, lien, or costs may be        added thereto, including Impositions, leasehold payments, and ground rents;              (2)   paid all Taxes for the Mortgaged Property that have become due before        any fine, penalty interest, lien, or costs may be added thereto pursuant to any notice of        assessment received by Borrower and any and all taxes that have become due against        Borrower before any fine, penalty interest, lien, or costs may be added thereto;              (3)   no knowledge of any basis for any additional assessments;              (4)    no knowledge of any presently pending special assessments against all or        any part of the Mortgaged Property not disclosed in the Title Policy, or any presently        pending special assessments against Borrower; and               (5)   not received any written notice of any contemplated special assessment        against the Mortgaged Property, or any contemplated special assessment against        Borrower.     Multifamily Loan and Security Agreement  (Non-Recourse)                        Form 6001.NR                        Page S3  Anicle II                                01-16                   C> 2016 Fannie Mae  

 

Section 12.02 Covenants.       (a)   Imposition Deposits, Taxes, and Other Charges.       Borrower shall:             (I)  deposit the Imposition Deposits with Lender on each Payment Date (or on       another day designated in writing by Lender) in amount sufficient, in Lender's discretion,       to enable Lender to pay each Imposition before the last date upon which such payment       may be made without any penalty or interest charge being added, plus an amount equal to       no more than one-sixth (1/6) (or the amount permitted by applicable law) of the       Impositions for the trailing twelve (12) months (calculated based on the aggregate annual       Imposition costs divided by twelve (12) and multiplied by two (2»;             (2)  deposit with Lender, within ten (10) days after written notice from Lender       (subject to applicable law), such additional amounts estimated by Lender to be       reasonably necessary to cure any deficiency in the amount of the Imposition Deposits       held for payment of a specific Imposition;             (3)  except as set forth in Section 12.03(c) below, pay all Impositions,       leasehold payments, ground rents, and Taxes when due and before any fine, penalty,       interest, lien, or costs may be added thereto;             (4)  promptly deliver to Lender a cop>, of all notices of, and invoices for,       Impositions, and, if Borrower pays any Impositton directly, Borrower shall promptly       furnish to Lender receipts evidencing such payments; and             (5)  promptly deliver to Lender a copy of all notices of any special assessments       and contemplated special assessments against the Mortgaged Property or Borrower.  Section 12.03 Mortgage Loan Administration Matters Regarding Impositions.        (a)  Maintenance of Records by Lender.        Lender shall maintain records of the monthly and aggregate Imposition Deposits held by  Lender for the purpose of paying Taxes, insurance premiums, and each other obligation of  Borrower for which Imposition Deposits are required.        (b)  Imposition Accounts.        All Imposition Deposits shall be held in an institution (which may be Lender, if Lender is  such an institution) whose deposits or accounts are insured or guaranteed by a federal agency and  which accounts meet the standards for custodial accounts as required by Lender from time to  time. Lender shall not be obligated to open additional accounts, or deposit Imposition Deposits  in additional institutions, when the amount of the Imposition Deposits exceeds the maxunum  amount of the federal deposit insurance or guaranty. No interest, earnings, or profits on the  Imposition Deposits shall be paid to Borrower unless applicable law so requires. Imposition  Deposits shall not be trust funds, nor shall they operate to reduce the Indebtedness, unless  applied by Lender for that purpose in accordance with this Loan Agreement. For the purposes of  9-104(a)(3) of the uee, Lender is the owner of the Imposition Deposits and shall be deemed a  "customer" with sole control of the account holding the Imposition Deposits.    Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 54  Article 12                           0\-\6                 II:> 20\ 6 Fannie Mae  

 

     (c)   Payment oflmpositions; Sufficiency oflmposition Deposits.       Lender may pay an Imposition according to any bill, statement, or estimate from the  appropriate public office or insurance company without inquiring into the accuracy of the bill,  statement, or estimate or into the validity of the Imposition. Imposition Deposits shall be  required to be used by Lender to pay Taxes, insurance premiums and  any other individual  Imposition only if:             (I)  no Event of Default exists;             (2)  Borrower has timely delivered to Lender all applicable bills or premium       notices that it has received; and             (3)  sufficient Imposition Deposits are held by Lender for each Imposition at       the time such Imposition becomes due and payable.       Lender shall have no liability to Borrower or any other Person for failing to pay any  Imposition if any of the conditions are not satisfied. If at any time the amount of the Imposition  Deposits held for payment of a specific Imposition exceeds the amount reasonably deemed  necessary by Lender to be held in connection with such Imposition, the excess may be credited  against future installments of Imposition Deposits for such Imposition.       (d)   Imposition Deposits Upon Event of Default.       If an Event of Default has occurred and is continuing, Lender may apply any Imposition  Deposits, in such amount and in such order as Lender determines, to pay any Impositions or as a  credit against the Indebtedness.        (e)  Contesting Impositions.        Other than insurance premiums, Borrower may contest, at its expense, by appropriate  legal proceedings, the amount or validity of any Imposition if:             (1)  Borrower notifies Lender of the commencement or  expected        commencement of such proceedings;             (2)   Lender determines that the Mortgaged Property is not in danger of being        sold or forfeited;             (3)   Borrower deposits with Lender (or the applicable Governmental Authority        if required by applicable law) reserves sufficient to pay the contested Imposition, if        required by Lender (or the applicable Governmental Authority);             (4)   Borrower furnishes whatever additional security is required in the        proceedings or is reasonably requested in writing by Lender; and             (5)   Borrower commences, and at all times thereafter diligently prosecutes,        such contest in good faith until a final determination is made by the applicable        Governmental Authority.    Multifamily Loan and Security Agreement  (Non-Recourse)              .     Form 600t.NR                     Page SS  Article 12                           01-16                 IC 2016 Fannie Mae  

 

     (1)   Release to Borrower.       Upon payment in full of all sums secured by the Security Instrument and this Loan  Agreement and release by Lender of the lien of the Security Instrument, Lender shall disburse to  Borrower the balance of any Imposition Deposits then on deposit with Lender.         ARTICLE 13 -  REPLACEMENT RESERVE AND REPAIRS  Section 13.01 Covenants.       (a)   Initial Deposits to Replacement Reserve Account and Repairs Escrow  Account.       On the Effective Date, Borrower shall pay to Lender:             (I)  the Initial Replacement Reserve Deposit for deposit into the Replacement       Reserve Account; and             (2)  the Repairs Escrow Deposit for deposit into the Repairs Escrow Account.       (b)   Monthly Replacement Reserve Deposits.       Borrower shall deposit the applicable Monthly Replacement  Reserve Deposit into the  Replacement Reserve Account on each Payment Date.       (c)   Payment for Replacements and Repairs.       Borrower shall:             (I)  pay all invoices for the Replacements and Repairs, regardless of whether        funds on deposit ID the Replacement Reserve Account or the Repairs Escrow Account, as        applicable, are sufficient, prior to any request for disbursement from the Replacement        Reserve Account or the Repairs Escrow Account, as applicable (unless Lender has agreed        to issue joint checks in connection with a particular Replacement or Repair);             (2)   pay all applicable fees and charges of any Governmental Authority on        account of the Replacements and Repairs, as applicable; and             (3)   provide evidence satisfactory to Lender of completion of the        Replacements and any Required Repairs (within the Completion Period or within such        other period or by such other date set forth in the Required Repair Schedule and any        Borrower Requested Repairs and Additional Lender Repairs (by the date specified by        Lender for any such Borrower Requested Repairs or Additional Lender Repairs».        (d)  Assignment of Contracts for Replacements and Repairs.        Borrower shall collaterally assign to Lender as additional security any contract or  subcontract for Replacements or Repairs, upon Lender's written request, on a form of  assignment approved by Lender.    Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 56  Article 12                           01-16                 \Q 2016 Fannie Mae  

 

     (e)   Indemnification.       If Lender elects to exercise its rights under Section 14.03 due to Borrower's failure to  timely commence or complete any Replacements or Repairs, Borrower shall indemnify and hold  Lender harmless for, from and against any  and all actions, suits, claims, demands, liabilities,  losses, damages, obligations, and costs or expenses, including litigation costs and reasonable  attorneys' fees, arising from or in any way connected with the performance by Lender of the  Replacements or Repairs or investment of the ReservelEscrow Account Funds; provided that  Borrower shall have no indemnity obligation if such actions, suits, claims, demands, liabilities,  losses, damages, obligations, and costs or expenses, including litigation costs and reasonable  attorneys' fees, arise as a result of the willful misconduct or gross negligence of Lender,  Lender's agents, employees, or representatives as determined by a court of competent  jurisdiction pursuant to a final non-appealable court order.         (I)  Amendments to Loan Documents.        Subject to Section 5.02, Borrower shall execute and deliver to Lender, upon written  request, an amendment to this Loan Agreement, the Security Instrument, and any other Loan  Document deemed necessary or desirable to perfect Lender's lien upon any portion of the  Mortgaged Property for which ReservelEscrow Account Funds were expended.        (g)  Administrative Fees and Expenses.        Borrower shall pay to Lender:             (1)   by the date specified in the applicable invoice, the Repairs Escrow        Account Administrative Fee and the Replacement Reserve Account Administration Fee        for Lender's services in administering the Repairs Escrow Account and Replacement        Reserve Account and investing the funds on deposit in the Repairs Escrow Account and        the Replacement Reserve Account, respectively;             (2)   within ten (10) days of demand, a reasonable inspection fee, not exceeding        the Maximum Inspection Fee, for each inspection of the Mortgaged Property by Lender        in connection with a Repair or Replacement, plus all other reasonable costs and out-of­       pocket expenses relating to such inspections; and             (3)   within ten (10) days of demand, all reasonable fees charged by any        engineer, architect, inspector or other person inspecting the Mortgaged Property on        behalf of Lender for each inspection of the Mortgaged Property in connection with a        Repair or Replacement, plus all other reasonable costs and out-of-pocket expenses        relating to such inspections.  Section 13.02 Mortgage Loan Administration Matters Regarding Reserves.        (a)  Accounts, Deposits, and Disbursements.             (1)   Custodial Accounts.                   (A)  The Replacement Reserve Account shall be an interest-bearing             account that meets the standards for custodial accounts as required by Lender             from time to time. Lender shall not be responsible for any losses resulting from             the investment of the Replacement  Reserve Deposits or for obtaining any   Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 57  Article 13                           01-16                 C) ZOl6 Fannie Mae  

 

            specific level or percentage of earnings on such investment. All interest, if any,              earned on the Replacement Reserve Deposits shall be added to and become part              of the Replacement Reserve Account; provided, however, if applicable law              requires, and so long as no Event of Default has occurred and is contmuing under              any of the Loan Documents, Lender shall pay to Borrower the interest earned on              the Replacement Reserve Account not less frequently than the Replacement              Reserve Account Interest Disbursement Frequency. In no event shall Lender be              obligated to disburse funds from the ReservelEscrow Account if an Event of              Default has occurred and is continuing.                     (B)   Lender shall not be obligated to deposit the Repairs Escrow              Deposits into an interest-bearing account.               (2)   Disbursements by Lender Only.               Only Lender or a designated representative of Lender may make disbursements        from the Replacement Reserve Account and the Repairs Escrow Account. Except as        provided in Section 13.02(a}(8}, disbursements  shall only be made upon Borrower        request and after satisfaction of all conditions for disbursement.               (3)   Adjustment to Deposits.                     (A)   Mortgage Loan Terms Exceeding Ten (10) Years.                     If the Loan Term exceeds ten (10) years (or five (5) years in the case of              any Mortgaged Property that is an "affordable housing property" as indicated on              the Summary of Loan Terms), a property condition assessment shall be ordered              by Lender for the Mortgaged Property at the expense of Borrower (which expense              may  be paid out of the Replacement Reserve Account if excess funds are              available). The property condition assessment shall be performed no earlier than              the sixth (6th) month and no later than the ninth (9th) month of the tenth (10th)              Loan Year and every tenth (10th) Loan Year thereafter if the Loan Term exceeds              twenty (20) years (or the fifth (5th) Loan Year in the case of any Mortgaged              Property that is an "affordable housing property" as indicated on the Summary of              Loan Terms and every fifth (5th) Loan Year thereafter if the Loan Term exceeds              ten (10) years}. After review of the property condition assessment, the amount of              the Monthly Replacement Reserve Deposit may be adjusted by Lender for the              remaining Loan Term  by written notice to Borrower so that the Monthly              Replacement Reserve Deposits are sufficient to fund the Replacements as and              when required andlor the amount to be held in the Repairs Escrow Account may              be adjusted by Lender so that the Repairs Escrow Deposit is sufficient to fund the              Repairs as and when required                     (B)   Transfers.                     In connection with any Transfer of the Mortgaged Property, or any              Transfer of an ownership interest in Borrower, Guarantor, or Key Principal that              requires Lender's consent, Lender may review the amounts on deposit, if any, in              the Replacement Reserve Account or the Repairs Escrow Account, the amount of              the  Monthly Replacement  Reserve Deposit and the likely repairs and              replacements required by the Mortgaged Property, and the related contingencies              which may  arise during the remaining Loan Term. Based upon that review,    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 58  Article 13                               01-16                   ~ 2016 Fannie Mae  

 

           Lender may require an additional deposit to the Replacement Reserve Account or             the Repairs Escrow Account, or an increase in the amount of the Monthly             Replacement Reserve Deposit as a condition to Lender's consent to such Transfer.             (4)   Insufficient Funds.             Lender may, upon thirty (30) days' prior written notice to Borrower, require an       additional deposit(s) to the Replacement Reserve Account or Repairs Escrow Account, or       an increase in the amount of the Monthly Replacement Reserve Deposit, if Lender       determines that the amounts on deposit in either the Replacement Reserve Account or the       Repairs Escrow Account are not sufficient to cover the costs for Required Repairs or       Required Replacements or, pursuant to the terms of Section 13.02(a)(9), not sufficient to       cover the costs for Borrower Requested Repairs, Additional Lender Repairs, Borrower       Requested Replacements, or Additional Lender Replacements. Borrower's agreement to       complete the Replacements or Repairs as required by this Loan Agreement shall not be       affected by the insufficiency of any balance in the Replacement Reserve Account or the       Repairs Escrow Account, as applicable.             (5)   Disbursements for Replacements and Repairs.                   (A)   Disbursement requests may only be made after completion of the             applicable Replacements and only to reimburse Borrower for the actual approved             costs of the Replacements. Lender shall not disburse from the Replacement             Reserve Account the costs of routine maintenance to the Mortgaged Property or             for costs which are to be reimbursed from the Repairs Escrow Account or any             similar account. Disbursement from the Replacement Reserve Account shall not             be made more frequently than the Maximum Replacement Reserve Disbursement             Interval. Other than in connection with a final request for disbursement,             disbursements from the Replacement Reserve Account shall not be less than the             Minimum Replacement Reserve Disbursement Amount.             .                    (B)   Disbursement requests may only be made after completion of the             applicable Repairs and only to reimburse Borrower for the actual cost of the             Repairs, up to the Maximum Repair Cost. Lender shall not disburse any amounts             which would cause the funds remaining in the Repairs Escrow Account after any             disbursement (other than with respect to the final disbursement) to be less than             the Maximum  Repair Cost of the then-current estimated cost of completing all             remaining Repairs. Lender shall not disburse from the Repairs Escrow Account             the costs of routine maintenance to the Mortgaged Property or for costs which              are to be reimbursed from the Replacement Reserve Account or any similar              account. Disbursement from the Repairs Escrow Account shall not be made              more frequently than the Maximum Repair Disbursement Interval. Other than in              connection with a final request for disbursement, disbursements from the Repairs              Escrow Account shall not be less than the Minimum Repairs Disbursement              Amount.              (6)   Disbursement Requests.              Each request by Borrower for disbursement from the Replacement Reserve        Account or the Repairs Escrow Account must be in writing, must specify the        Replacement or Repair for which reimbursement is requested (provided that for any        Borrower Requested Replacements, Borrower Requested Repairs, Additional Lender   Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 59  Anicle 13                               01-16                   C 2016 Fannie Mac  

 

    Replacements, and Additional Lender Repairs, Lender shall have approved the use of the      ReservelEscrow Account Funds for such replacements or repairs pursuant to the terms of       Section 13.02(a)(9», and must:                 (A)   if applicable, specify the quantity and price of the items or            materials purchased, grouped by type or category;                 (B)   if applicable, specify the cost of all contracted labor or other            services involved in the Replacement or Repair for which such request for            disbursement is made;                  (C)  if applicable, include copies of invoices for all items or materials            purchased and all contracted labor or services provided;                  (0)  include evidence of payment of such Replacement or Repair            satisfactory to Lender (unless Lender has agreed to issue joint checks in            connection with a particular Repair or Replacement as provided in this Loan            Agreement); and                  (E)  contain a certification by Borrower that the Repair or            Replacement has been completed lien free and in a good and workmanlike            manner, in accordance with any plans and specifications previously approved by            Lender (if applicable) and in compliance with all applicable laws, ordinances,            rules, and regulations of any Governmental Authority having jurisdiction over            the Mortgaged Property, and otherwise in accordance with the provisions of this            Loan Agreement.            (7)   Conditions to Disbursement.            Lender may require any or all of the following at the expense of Borrower as a       condition to disbursement of funds from the Replacement Reserve Account or the       Repairs Escrow Account that are in excess of $10,000 or for life-safety Repairs or       Replacements (provided that for any Borrower Requested Replacements, Borrower       Requested Repairs, Additional  Lender Replacements, and Additional Lender Repairs,       Lender shall have approved the use of the ReservelEscrow Account Funds for such       replacements or repairs pursuant to the terms of Section 13.02(a)(9»:                  (A)  an inspection by Lender of the Mortgaged Property and the            applicable Replacement or Repair;                  (B)  an inspection or certificate of completion by an appropriate            independent qualified professional (such as an architect, engineer or property            inspector, depending on the nature of the Repair or Replacement) selected by            Lender;                  (C)  either:                       (i)   a search of title to the Mortgaged Property effective to the                  date of disbursement; or                       (ii)  a "date-down" endorsement to Lender's Title Policy (or a                  new Lender's Title Policy if a "date-down" is not available) extending the   Multifamily Loan and Security Agreement  (Non-Recourse)                   Form 6001.NR                     Page 60  Article 13                          01-16                 CI 2016 Fannie Mae  

 

                effective date of such policy to the date of disbursement, and showing no                  Liens other than (1) Permitted Encumbrances, (2) liens which Borrower is                  diligently contesting in good faith that have been bonded off to the                  satisfaction of Lender, or (3) mechanics' or materialmen's liens which                  attach automatically under the laws of any Govemmental Authority upon                  the commencement of any work upon, or delivery of any materials to, the                  Mortgaged Property and for which Borrower IS not delinquent in the                  payment for any such work or materials; and                  (D)   an acknowledgement of payment, waiver of claims, and release of             lien for work performed and materials supplied from each contractor,             subcontractor or materialman in accordance with the requirements of applicable             law and covering all work performed and materials supplied (including             equipment and fixtures) for the Mortgaged Property by that contractor,             subcontractor, or materialman through the date covered by the disbursement             request (or, in the event that payment to such contractor, subcontractor, or             materialman is to be made by a joint check, the release of lien shall be effective             through the date covered by the previous disbursement).             (8)  Joint Checks for Periodic Disbursements.             Lender may, upon Borrower's written request, issue joint checks, payable to       Borrower and the appltcable supplier, materialman, mechanic, contractor, subcontractor,       or other similar party, if:                  (A)   the cost of the Replacement or Repair exceeds the Replacement             Threshold or the Repair Threshold, as applicable, and the contractor performing             such Replacement or Repair requires periodic payments pursuant to the terms of             the applicable written contract;                   (8)  the contract for such Repair or Replacement requires payment             upon completion of the applicable portion of the work;                   (C)  Borrower makes the disbursement request after completion of the             applicable portion of the work required to be completed under such contract;                    (0)  the materials for which the request for disbursement has been             made are on site at the Mortgaged Property and are properly secured or installed;                    (E)  Lender determines that the remaining funds in the Replacement             Reserve Account designated for such Replacement, or in the Repairs Escrow             Account designated for such Repair, as applicable, are sufficient to pay such             costs and the then-current estimated cost of completing all remaining Required             Replacements or Required Repairs (at the Maximum Repair Cost), as applicable,             and any other Borrower Requested Replacements, Borrower Requested Repairs,             Additional Lender Replacements, or Additional Lender Repairs that have been             previously approved by Lender;                   (F)  each supplier, materialman, mechanic, contractor, subcontractor,             or other similar party receiving payments shall have provided, if requested in             writing by Lender, a waiver of liens with respect to amounts which have been             previously paid to them; and   Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 61  Article 13                           01-16                 «:> 2016 Fannie Mae  

 

               (0)   all other conditions for disbursement have been satisfied.            (9)  Replacements and Repairs Other than Required Replacements or      Required Repairs.            (A)  Borrower  Requested Replacements and Borrower  Requested      Repairs.                 Borrower may submit a disbursement request from the Replacement            Reserve Account or the Repairs Escrow Account to reimburse Borrower for any            Borrower Requested Replacement or Borrower Requested Repair. The            disbursement request must be in writing and include an explanation for such            request. Lender shall make disbursements for Borrower Requested Replacements            or Borrower Requested Repairs if:                        (i)   they are of the type intended to be covered by the                  Replacement Reserve Account or the Repairs Escrow Account, as                  applicable;                        (ii)  the costs are commercially reasonable;                        (iii) the amount of funds in the Replacement Reserve Account                  or Repairs Escrow Account, as applicable, is sufficient to pay such costs                  and the then-current estimated cost of completing all remaming Required                  Replacements or Required Repairs (at the Maximum Repair Cost), as                  applicable, and any other Borrower Requested Replacements, Borrower                  Requested Repairs, Additional Lender Replacements or Additional Lender                  Repairs that have been previously approved by Lender; and                       (iv)  all conditions for disbursement from the Replacement                  Reserve Account or Repairs Escrow Account, as applicable, have been                  satisfied.            Nothing in this Loan Agreement shall limit Lender's right to require an additional            deposit  to the Replacement Reserve Account or an increase to the Monthly            Replacement Reserve Deposit in connection with any such Borrower Requested            Replacements, or an additional deposit to the Repairs Escrow Account for any            such Borrower Requested Repairs.             (B)   Additional Lender Replacements and Additional Lender Repairs.                  Lender may require, as set forth in Section 6.02(b), Section 6.03(c), or            otherwise from time to time, upon written notice to Borrower, that Borrower            make Additional Lender Replacements or Additional  Lender Repairs. Lender            shall make disbursements from the Replacement Reserve Account for Additional            Lender Replacements or from the Repairs Escrow Account for Additional Lender            Repairs, as applicable, if:                       (i)   the costs are commercially reasonable;                        (ii)  the amount of funds in the Replacement Reserve Account                  or the Repairs Escrow  Account, as applicable, is sufficient to pay such   Multlramlly Loan and Security Agreement  (Non-Recourse)                   Form 6001.NR                     Page 62  Article 13                          01-16                 02016 Fannie Mae  

 

                 costs and the then-current estimated cost of completing all remaining                   Required Replacements or Required Repairs (at the Maximum Repair                   Cost), as applicable, and any other Borrower Requested Replacements,                   Borrower  Requested Repairs, Additional Lender Replacements, or                   Additional Lender Repairs that have been previously approved by Lender;                   and                          (iii) all conditions for disbursement from the Replacement                   Reserve Account or Repairs Escrow Account, as applicable, have been                   satisfied.             Nothing in this Loan Agreement shall limit Lender's right to require an additional             deposit to the Replacement Reserve Account or an increase to the Monthly             Replacement Reserve Deposit for any such Additional Lender Replacements or an             additional deposit to the Repairs Escrow Account for any such Additional Lender             Repair.             (10)  Excess Costs.             In the event any Replacement or Repair exceeds the approved cost set forth on the       Required Replacement Schedule for Replacements, or the Maximum Repair Cost for       Repairs, Borrower may submit a disbursement request to reimburse Borrower for such       excess cost. The disbursement request must be in writing and include an explanation for       such request. Lender shan make disbursements from the Replacement Reserve Account       or the Repairs Escrow Account, as applicable, if:                    (A)   the excess cost is commercially reasonable;                     (8)   the amount of funds in the Replacement Reserve Account or the             Repairs Escrow Account, as applicable, is sufficient to pay such costs and the              then-current estimated cost of completing all remaining Required Replacements              or Required Repairs (at the Maximum Repair Cost), as applicable, and  any other              Borrower Requested Replacements, Borrower Requested Repairs, Additional              Lender Replacements, or Additional Lender Repairs that have been previously              approved by Lender; and                    (C)   an conditions for disbursement from the Replacement Reserve              Account or the Repairs Escrow Account have been satisfied.              (11)  Final Disbursements.              Upon completion of all Repairs in accordance with this Loan Agreement and so        long as no Event of Default has occurred and is continuing, Lender shall disburse to        Borrower any amounts then remaining in the Repairs Escrow Account. Upon payment in        full of the Indebtedness and release by Lender of the lien of the Security Instrument,        Lender shall disburse to Borrower any and all amounts then remaining in the        Replacement Reserve Account and the Repairs Escrow Account (if not previously        released).    Multlramlly Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 63  Article 13                              01-16                   «) 2016 FannIe Mae  

 

      (b)   Approvals of Contracts; Assignment of Claims.        Lender retains the right to approve all contracts or work orders with materialmen,  mechanics, suppliers, subcontractors, contractors, or other parties providing labor or materials in  connection with the Replacements or Repairs. Notwithstanding Borrower's assignment (in the  Security Instrument) of its rights and claims against all Persons supplying labor or materials in  connection with the Replacement or Repairs, Lender will not pursue any such right or claim  unless an Event of Default has occurred and is continuing or as otherwise provided in Section  14.03(c).        (c)   Delays and Workmanship.        If any work for any Replacement or Repair has not timely commenced, has not been  timely performed in a workmanlike manner, or has not been timely completed in a workmanlike  manner, Lender may, without notice to Borrower:               (I)   withhold disbursements from the Replacement Reserve Account or        Repairs Escrow Account for such unsatisfactory Replacement or Repair, as applicable;              (2)   proceed under existing contracts or contract with third parties to make or        complete such Replacement or Repair;              (3)   apply the funds in the Replacement Reserve Account or Repairs Escrow        Account toward the labor and materials necessary to make or complete such Replacement        or Repair, as applicable; or              (4)   exercise any and all other remedies available to Lender under this Loan        Agreement or any other Loan Document, including any remedies otherwise available        upon an Event of Default pursuant to the terms of Section 14.02.  To facilitate Lender's completion or making of such Replacements or Repairs, Lender shall have  the ri2ht to enter onto the Mortgaged Property (subject to the rights of tenants) and perform any  and aTi work and labor necessary to make or complete the Replacements or Repairs and employ  watchmen to protect the Mortgaged Property from damage. All funds so expended by Lender  shall be deemed to have been advanced to Borrower, shall be part of the Indebtedness and shall  be secured by the Security Instrument and this Loan Agreement.        (d)   Appointment of Lender as Attorney-In-Fact.        Borrower hereby authorizes and appoints Lender as attorney-in-fact pursuant to Section  14.03(c).        (e)    No Lender Obligation.        Nothing in this Loan Agreement shall:               (I)    make Lender responsible for making or completing the Replacements or        Repairs;               (2)   require Lender to expend funds, whether from the Replacement Reserve        Account, the Repairs Escrow Account, or otherwise, to make or complete any         Replacement or Repair;    Multifamily Loan and Security Agreement   (Non-Recourse)                       Form 6001.NR                        Page 64   Article 13                              01-16                   C> 2016 Fannie Mae  

 

            (3)   obligate Lender to proceed with the Replacements or Repairs; or              (4)   obligate Lender to demand from Borrower additional sums to make or        complete any Replacement or Repair.         (f)   No Lender Warranty.         Lender's approval of any plans for any Replacement or Repair, release of funds from the  Replacement Reserve Account or Repairs Escrow Account, inspection of the Mortgaged  Property by Lender or its agents, representatives, or designees, or other acknowledgment of  completion of any Replacement or Repair in a manner satisfactory to Lender shall not be deemed  an acknowledgment or warranty to any Person that the Replacement or Repair has been  completed in accordance with applicable building, zoning, or other codes, ordinances, statutes,  laws, regulations, or requirements of any Governmental Authority,  such responsibility being at  all times exclusively that of Borrower.                     ARTICLE 14 -   DEFAULTSIREMEDIES  Section 14.01  Events of Default.        The occurrence of any one or more of the following in this Section 14.01 shall constitute  an Event ofDefauIt under this Loan Agreement.        (a)   Automatic Events of Default.        Any of the following shall constitute an automatic Event of Default:               (I)   any failure by Borrower to payor deposit when due any amount required        by the Note, this Loan Agreement or any other Loan Document;              (2)   any failure by Borrower to maintain the insurance coverage required by        any Loan Document;              (3)   any failure by Borrower to comply with the provisions of Section 4.02(d)        relating to its single asset status;              (4)   if any warranty, representation, certification, or statement of Borrower,        Guarantor, or Key Principal in this Loan Agreement or any of the other Loan Documents        is false, inaccurate, or misleading in any material respect when made;              (5)    fraud, gross negligence, willful misconduct, or material misrepresentation        or material omission by or on behalf of Borrower, Guarantor, or Key Principal or any of        their officers, directors, trustees, partners, members, or managers in connection with:                     (A)   the application for, or creation of, the Indebtedness;                      (8)   any financial statement, rent roll, or other report or information               provided to Lender during the term of the Mortgage Loan; or                     (C)   any request for Lender's consent to any proposed action, including               a request for disbursement of ReservelEscrow Account Funds or Collateral               Account Funds;    Multifamily Loan and Security Agreement   (Non-Recourse)                       Form 6001.NR                        Page 6S   Article 13                              01-16                   C 2016 Fannie Mae  

 

           (6)  the occurrence of any Transfer not permitted by the Loan Documents;             (7)  the occurrence of a Bankruptcy Event;             (8)  the commencement of a forfeiture action or other similar proceeding,       whether civil or criminal, which, in Lender's reasonable judgment, could result in a       forfeiture of the Mortgaged Property or otherwise materially impair the lien created by       this Loan Agreement or the Security Instrument or Lender's interest in the Mortgaged       Property;             (9)  if Borrower, Guarantor, or Key Principal is a trust, or if Control of       Borrower, Guarantor, or Key Principal is Transferred or if a Restricted Ownership       Interest in Borrower, Guarantor, or Key Principal would be Transferred due to the       termination or revocation of a trust, the termination or revocation of such trust, except as       set forth in Section Il.03(d);             (10) any failure by Borrower to complete any Repair related to fire, life, or       safety issues in accordance with the terms of this Loan Agreement within the Completion       Period (or such other date set forth on the Required Repair Schedule or otherwise       required by Lender in writing for such Repair); or             (11) any exercise by the holder of any other debt instrument secured by a       mortgage, deed of trust, or deed to secure debt on the Mortgaged Property of a right to       declare all amounts due under that debt instrument immediately due and payable.       (b)   Events of Default Subject to a Specified Cure Period.       Any of the following shall constitute an Event of Default subject to the cure period set  forth in the Loan Documents:             (1)  if Key Principal or Guarantor is a natural person, the death of such       individual, unless all requirements of Section Il.03(e) are met;             (2)  the occurrence of a Guarantor Bankruptcy Event, unless requirements of        Section Il.03(t) are met;             (3)  any failure by Borrower, Key Principal, or Guarantor to comply with the        provisions of Section 5.02(b) and Section 5.02(c); or             (4)   any failure by Borrower to perform any obligation under this Loan        Agreement or any Loan Document that is subject to a specified  written notice and cure        period, which failure continues beyond such specified written notice and cure period as        set forth herein or in the applicable Loan Document.        (c)  Events of Default Subject to Extended Cure Pcriod.        The following shall constitute an Event of Default if the existence of such condition or  event, or such failure to perform or default in performance continues for a period of thirty (30)  days after written notice by Lender to Borrower of the existence of such condition or event, or of  such failure to perform or default in performance, provided, however, such period may be  extended for up to an additional thirty (30) days if Borrower, in the discretion of Lender, is  diligently pursuing a cure of such; provided, further, however, no such written notice, grace   Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 66  Article 14                           01-16                 (!) 2016 Fannie Mae  

 

period, or extension shall apply if, in Lender's discretion, immediate exercise by Lender of a  right or remedy under this Loan Agreement or any Loan Document is required to avoid harm to  Lender or impairment of the Mortgage Loan (including the Loan Documents), the Mortgaged  Property or any other security given for the Mortgage Loan:              (I)   any failure by Borrower to perform any of its obligations under this Loan        Agreement or any Loan Document (other than those specified in Section 14.0I(a) or        Section 14.0 I (b) above} as and when required.  Section 14.02  Remedies.        (a)   Acceleration; Foreclosure.        If an Event of Default has occurred and is continuing, the entire unpaid principal balance  of the Mortgage Loan, any Accrued Interest, interest accruing at the Default Rate, the  Prepayment Premium (if applicable), and all other Indebtedness, at the option of Lender, shall  immediately become due and payable, without any prior written notice to Borrower, unless  applicable law requires otherwise (and in such case, after any required written notice has been  given). Lender may exercise this option to accelerate regardless of any prior forbearance. In  addition, Lender shall have all rights and remedies afforded to Lender hereunder and under the  other Loan Documents, including, foreclosure on and/or the power of sale of the Mortgaged  Property, as provided in the Security Instrument, and any rights and remedies available to Lender  at law or in equity (subject to Borrower's statutory rights of reinstatement, if any). Any proceeds  of a Foreclosure Event may be held and applied by Lender as additional collateral for the  Indebtedness pursuant to this Loan Agreement. Notwithstanding the foregoing, the occurrence  of any Bankruptcy Event shall automatically  accelerate the Mortgage Loan and all obligations  and Indebtedness shall be immediately due and payable without written notice or further action  by Lender.        (b)   Loss of Right to Disbursements from Collateral Accounts.        If an Event of Default has occurred and is continuing, Borrower shall immediately lose  all of its rights to receive disbursements from the ReservelEscrow Accounts and any Collateral  Accounts.  During the continuance of any such Event of Default, Lender may use the  ReservelEscrow Account Funds and  any Collateral Account Funds (or any portion thereot) for  any purpose, including:              (I)   repayment of the Indebtedness, including principal prepayments and the        Prepayment Premium  applicable to such full or partial prepayment, as applicable        (however, such application of funds shall not cure or be deemed to cure any Event of        Default);              (2)   reimbursement of Lender for all losses and expenses (including reasonable        legal fees) suffered or incurred by Lender as a result of such Event of Default;              (3)   completion of the Replacement or Repair or for any other replacement or        repair to the Mortgaged Property; and              (4)   payment of any amount expended in exercising (and the exercise ot) all        rights and remedies available to Lender at law or in equity or under this Loan Agreement        or under any of the other Loan Documents.    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 67  Article 14                               01-16                   Cl2016 Fannie Mac  

 

Nothing in this Loan Agreement shall obligate Lender to apply all or any portion of the  ReservelEscrow Account Funds or Collateral Account Funds on account of any Event of Default  by Borrower or to repayment of the Indebtedness or in any specific order of priority.        (c)   Remedies Cumulative.        Each right and remedy provided in this Loan Agreement is distinct from all other rights  or remedies under this Loan Agreement or any other Loan Document or afforded by applicable  law. and each shall be cumulative and may be exercised concurrently, independently, or  successively. in any order. Lender shall not be required to demonstrate any actual Impairment of  its security or any increased risk of additional default by Borrower in order to exercise any of its  remedies with respect to an Event of Default.  Section 14.03  Additional Lender Rights; Forbearance.        (a)   No Effect Upon Obligations.        Lender may. but shall not be obligated to. agree with Borrower, from time to time. and  without giving notice to. or obtaining the consent of. or having any effect upon the obligations  of, Guarantor. Key Principal. or other third party obligor. to take any of the following actions:               (1)   the time for payment of the principal of or interest on the Indebtedness        may be extended. or the Indebtedness may be renewed in whole or in part;              (2)   the rate of interest on or period of amortization of the Mortgage Loan or        the amount of the Monthly Debt Service Payments payable under the Loan Documents        may be modified;              (3)   the time for Borrower's performance of or compliance with any covenant        or agreement contained in any Loan Document. whether presently existing or hereinafter        entered into. may be extended or such performance or compliance may be waived;              (4)   any or all payments due under this Loan Agreement or any other Loan        Document may be reduced;              (5)   any Loan  Document may  be modified or amended by  Lender and        Borrower in any respect. including an increase in the principal amount of the Mortgage        Loan;              (6)   any amounts under this Loan Agreement or any other Loan Document        may be released;              (7)   any security for the Indebtedness may be modified, exchanged, released.        surrendered. or otherwise dealt with. or additional security may be pledged or mortgaged        for the Indebtedness;              (8)   the payment of the Indebtedness or any security for the Indebtedness. or        both, may be subordinated to the right to payment or the security. or both. of any other        present or future creditor of Borrower; or              (9)   any other terms of the Loan Documents may be modified.    Multifamily Loan and Security Agreemcnt  (Non-Rccourse)                       Form 6001.NR                        Page 68  Article 14                               01-16                   CJ 2016 Fannie Mae  

 

                                                                                    -         (b)   No Waiver of Rights or Remedies.        Any waiver of an Event of Default or forbearance by Lender in exercising any right or  remedy under this Loan Agreement or any other Loan Document or otherwise afforded by  applicable law, shall not be a waiver of any other Event of Default or preclude the exercise or  failure to exercise of any other right or remedy. The acceptance by Lender of payment of all or  any part of the Indebtedness after the due date of such payment, or in an amount which is less  than the required payment, shall not be a waiver of Lender's right to require prompt payment  when due of all other payments on account of the Indebtedness or to exercise any remedies for  any failure to make prompt payment. Enforcement by Lender of any security for the  Indebtedness shall not constitute an election by Lender of remedies so as to preclude the exercise  or failure to exercise of any other right available to Lender. Lender's receipt of any insurance  proceeds or amounts in connection with a Condemnation Action shall not operate to cure or  waive any Event of Default.        (c)   Appointment of Lender as Attorney-In-Fact.        Borrower hereby irrevocably makes, constitutes, and appoints Lender (and any officer of  Lender or any Person designated by Lender for that purpose) as Borrower's true and lawful  proxy and attorney-in-fact (and agent-in-fact) in Borrower's name, place, and stead, with full  power of substitution, -to:               (1)   use any of the funds in the Replacement Reserve Account or Repairs        Escrow Account for the purpose of making or completing the Replacements or Repairs;              (2)   make  such additions, changes, and corrections to the Replacements or        Repairs as shall be necessary or desirable to complete the Replacements or Repairs;              (3)   employ such contractors, subcontractors, agents, architects, and inspectors        as shall be required for such purposes;              (4)   pay, settle, or compromise all bills and claims for materials and work        performed in connection with the Replacements or Repairs, or as may be necessary or        desirable for the completion of the Replacements or Repairs, or for clearance of title;              (5)   adjust and compromise any claims under any and all policies of insurance        required pursuant to this Loan Agreement and any other Loan Document, subject only to        Borrower's rights under this Loan Agreement;              (6)   appear in and prosecute any action arising from any insurance policies;              (7)   collect and receive the proceeds of insurance, and to deduct from such        proceeds Lender's expenses incurred in the collection of such proceeds;              (8)   commence, appear in, and prosecute, in Lender's or Borrower's name, any        Condemnation Action;              (9)   settle or compromise any claim in connection with any Condemnation        Action;              (10)  execute all applications and certificates in the name of Borrower which        may be required by any of the contract documents;   Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 69  Anicle 14                                01-16                   Cl2016 Fannie Mac  

 

            (11)  prosecute and defend all actions or proceedings in connection with the        Mortgaged Property or the rehabilitation and repair of the Mortgaged Property;              (12)  take such actions as are permitted in this Loan Agreement and  any other        Loan Documents;              (13)  execute such financing statements and other documents and to do such        other acts as Lender may require to perfect and preserve Lender's security interest in, and        to enforce such interests in, the collateral; and              (14)  carry out any remedy provided for in this Loan Agreement and any other        Loan Documents, including endorsing Borrower's name to checks, drafts, instruments        and other items of payment and proceeds of the collateral, executing change of address        forms with the postmaster of the United States Post Office serving the address of        Borrower, changmg the address of Borrower to that of Lender, opening all envelopes        addressed to Borrower, and applying any payments contained therein to the Indebtedness.        Borrower hereby acknowledges that the constitution and appointment of such proxy and        attorney-in-fact are coupled with an interest and are irrevocable and shall not be affected        by the disability or incompetence of Borrower. Borrower specifically acknowledges and        agrees that this power of attorney granted to Lender may be assIgned by Lender to        Lender's successors or assigns as holder of the Note (and the other Loan Documents).        The foregoing powers conferred on Lender under this Section 14.03(c) shall not impose        any duty upon Lender to exercise any such powers and shall not require Lender to incur        any expense or take any action. Borrower hereby ratifies and confirms all that such        attorney-in-fact may do or cause to be done by virtue of any provision of this Loan        Agreement and any other Loan Documents.        Notwithstanding the foregoing provisions, Lender shall not exercise its rights as set forth        in this Section 14.03(c) unless: (A) an Event of Default has occurred and is continuing,        or (B) Lender determines, in its discretion, that exigent circumstances exist or that such        exercise is necessary or prudent in order to protect and preserve the Mortgaged Property,        or Lender's lien priority and security interest in the Mortgaged Property.         (d)   Borrower Waivers.        If more than one Person signs this Loan Agreement as Borrower, each Borrower, with  respect to any other Borrower, hereby agrees that Lender, in its discretion, may:              (1)   bring suit against Borrower, or anyone or more of Borrower, jointly and        severally, or against anyone or more of them;              (2)   compromise or settle with anyone or more of the persons constituting        Borrower, for such consideration as Lender may deem proper;              (3)   release one or more of the persons constituting Borrower, from liability; or              (4)   otherwise deal with Borrower, or anyone or more of them, in any manner,        and no such action shall impair the rights of Lender to collect from any Borrower the full        amount of the Indebtedness.    Multlramily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 70  Article 14                               01-16                   10 2016 FannIe Mae  

 

Section 14.04  Waiver of Marshaling.        Notwithstanding the existence of any other security interests in the Mortgaged Property  held by Lender or by any other party, Lender shall have the right to determine the order in which  any or all of the Mortgaged Property shall be subjected to the remedies provided in this Loan  Agreement, any other Loan Document or applicable law. Lender shall have the right to  determine the order in which all or any part of the Indebtedness is satisfied from the proceeds  realized upon the exercise of such remedies. Borrower and any party who now or in the future  acquires a security interest in the Mortgaged Property and who has actual or constructive notice  of this Loan Agreement waives any and all right to require the marshaling of assets or to require  that any of the Mortgaged Property be sold in the inverse order of alienation or that any of the  Mortgaged Property be sold in parcels or as an entirety in connection with the exercise of any of  the remedies permitted by applicable law or provided in this Loan Agreement or any other Loan  Documents.        Lender shall account for any moneys received by Lender in respect of any foreclosure on  or disposition of collateral hereunder and under the other Loan Documents provided that Lender  shall not have any duty as to any collateral, and Lender shall be accountable only for amounts  that it actually receives as a result of the exercise of such powers. NONE OF LENDER OR ITS  AFFILIATES, OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, OR REPRESENTATIVES  SHALL  BE RESPONSIBLE   TO  BORROWER (A)    FOR ANY  ACT OR FAILURE    TO ACT  UNDER   ANY  POWER    OF ATTORNEY    OR  OTHERWISE,   EXCEPT   IN RESPECT   OF  DAMAGES    ATTRIBUTABLE     SOLELY   TO  THEIR  OWN   GROSS   NEGLIGENCE    OR  WILLFUL MISCONDUCT AS      FINALLY DETERMINED PURSUANT TO       A FINAL, NON­ APPEALABLE COURT ORDER BY A COURT OF        COMPETENT JURISDICTION, NOR (B)  FOR ANY PUNITIVE, EXEMPLARY, INDIRECT OR CONSEQUENTIAL DAMAGES.                       ARTICLE 15-NDSCELLANEOUS  Section 15.01  Governing Law; Consent to Jurisdiction and Venue.        (a)   Governing Law.        This Loan Agreement and any other Loan Document which does not itself expressly  identitY the law that is to apply to it, shall be governed by the laws of the Property Jurisdiction  without regard to the application of choice of law principles.        (b)   Venue.        Any controversy arising under or in relation to this Loan Agreement or any other Loan  Document shall be litigated exclusively in the Property Jurisdiction without regard to conflicts of  laws principles. The state and federal courts and authorities with jurisdiction in the Property  Jurisdiction shall have exclusive jurisdiction over all controversies which shall arise under or in  relation to this Loan Agreement or any other Loan Document. Borrower irrevocably consents to  service, jurisdiction, and venue of such courts for any such litigation and waives any other venue  to which it might be entitled by virtue of domicile, habitual residence, or otherwise.    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 71  Article 14                               01-16                   II:) 2016 Fannie Mae  

 

Section 15.02  Notice.        (a)   Process of Serving Notice.        Except as otherwise set forth herein or in any other Loan Document, all notices under this  Loan Agreement and any other Loan Document shall be:              (1)   in writing and shall be:                    (A)   delivered, in person;                    (B)   mailed, postage prepaid, either by registered or certified delivery,              return receipt requested;                     (C)   sent by overnight courier; or                    (0)   sent by electronic mail with originals to follow by overnight              courier;              (2)   addressed to the intended recipient at Borrower's Notice Address and        Lender's Notice Address, as applicable; and                      _              (3)   deemed given on the earlier to occur of:                    (A)   the date when the notice is received by the addressee; or                    (B)   if the recipient refuses or rejects delivery, the date on which the              notice is so refused or rejected, as conclusively established by the records of the              United States Postal Service or such express courier service.         (b)   Change of Address.        Any party to this Loan Agreement may change the address to which notices intended for  it are to be directed by means of notice given to the other parties identified on the Summary of  Loan Terms in accordance with this Section 15.02.        (c)   Default Method of Notice.        Any required notice under this Loan Agreement or any other Loan Document which does  not specify how notices are to be given shall be given in accordance with this Section 15.02.        (d)   Receipt of Notices.        Neither Borrower nor Lender shall refuse or reject delivery of any notice given in  accordance with this Loan Agreement. Each party is required to acknowledge, in writing, the  receipt of any notice upon request by the other party.    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 72  Article IS                               01-16                   (Q 2016 Fannie Mae  

 

Section 15.03  Successors and Assigns Bound; Sale of Mortgage Loan.        (a)   Binding Agreement.         This Loan Agreement shall bind, and the rights granted by this Loan Agreement shall  inure to, the successors and assigns of Lender and the permitted successors and assigns of  Borrower. However, a Transfer not permitted by this Loan Agreement shall be an Event of  Default and shall be void ab initio.        (b)   Sale of Mortgage Loan; Change ofServicer.        Nothing in this Loan Agreement shall limit Lender's (including its successors and  assigns) right to sell or transfer the Mortgage Loan or any interest in the Mortgage Loan. The  Mortgage Loan or a partial interest in the Mortgage Loan (together with this Loan Agreement  and the other Loan Documents) may be sold one or more times without prior written notice to  Borrower. A sale may result in a change of the Loan Servicer.  Section 15.04  Counterparts.        This Loan Agreement may be executed in any number of counterparts with the same  effect as if the parties hereto had signed the same document and all such counterparts shall be  construed together and shall constitute one instrument.  Section 15.05  Joint and Several (or Solidary) Liability.        If more than one Person signs this Loan Agreement as Borrower, the obligations of such  Persons shall be joint and several (solidary instead for purposes of Louisiana law).  Section 15.06  Relationship of Parties; No Third Party Beneficiary.        (a)   Solely Creditor and Debtor.        The relationship between Lender and Borrower shall be solely that of creditor and debtor,  respectively, and nothing contained in this Loan Agreement shall create any other relationship  between Lender and Borrower. Nothing contained in this Loan Agreement shall constitute  Lender as a joint venturer, partner, or agent of Borrower, or render Lender liable for any debts,  obligations, acts, omissions, representations, or contracts of Borrower.        (b)   No Third Party Beneficiaries.        No creditor of any party to this Loan Agreement and no other Person shall be a third  party beneficiary of this Loan Agreement or any other Loan Document or any account created or  contemplated under this Loan Agreement or any other Loan Document. Nothing contained in  this Loan Agreement shall be deemed or construed to create an obligation on the part of Lender  to any third party nor shall any third party have a right to enforce against Lender any right that  Borrower may have under this Loan Agreement. Without limiting the foregoing:              (I)   any Servicing Arrangement between Lender and any Loan Servicer shall        constitute a contractual obligation of such Loan Servicer that is independent of the        obligation of Borrower for the payment of the Indebtedness;    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 73  Anicle 15                                01-16                   Q 2016 Fannie Mae  

 

            (2)   Borrower shall not be a third party beneficiary of any Servicing        Arrangement; and               (3)   no payment by the Loan Servicer under any Servicing Arrangement will        reduce the amount of the Indebtedness.   Section 15.07  Severability; Entire Agreement; Amendments.         The invalidity or unenforceability of any provision of this Loan Agreement or any other  Loan Document shall not affect the validity or enforceability of any other provision of this Loan  Agreement or of any other Loan Document, all of which shall remain in full force and effect,  including the Guaranty. This Loan Agreement contains the complete and entire agreement  among the parties as to the matters covered, rights granted, and the obligations assumed in this  Loan Agreement. This Loan Agreement may not be amended or modified except by written  agreement signed by the parties hereto.   Section 15.08  Construction.         (a)   The captions and headings of the sections of this Loan Agreement and the Loan  Documents are for convenience only and shall be disregarded in construing this Loan Agreement  and the Loan Documents.         (b)   Any  reference in this Loan Agreement to an "Exhibit" or "Schedule" or a  "Section" or an "Article" shall, unless otherwise explicitly provided, be construed as referring,  respectively, to an Exhibit or Schedule attached to thiS Loan Agreement or to a Section or Article  of this Loan Agreement.         (c)   Any reference in this Loan Agreement to a statute or regulation shall be construed  as referring to that statute or regulation as amended from time to time.         (d)   Use of the singular in this Loan Agreement includes the plural and use of the  plural includes the singular.         (e)   As used in this Loan Agreement, the term "including" means "including, but not  limited to" or "including, without limitation," and is for example only and not a limitation.         (f)   Whenever Borrower's knowledge is implicated in this Loan Agreement or the  phrase "to Borrower's knowledge" or a similar phrase is used in this Loan Agreement,  Borrower's knowledge or such phrase(s) shall be interpreted to mean to the best of Borrower's  knowledge after reasonable and diligent inquiry and investigation.         (g)   Unless otherwise provided in this Loan Agreement, if Lender's approval,  designation, determination, selection, estimate, action, or decision is required, permitted, or  contemplated hereunder, such approval, designation, determination, selection, estimate, action,  or decision shall be made in Lender's sole and absolute discretion.         (h)   All references in this Loan Agreement to a separate instrument or agreement shall  include such instrument or agreement as the same may be amended or supplemented from time  to time pursuant to the applicable provisions thereof.         (i)   "Lender may" shall mean at Lender's discretion, but shall not be an obligation.     Multifamily Loan and SecurIty Agreement  (Non-Recourse)                       Form 6001.NR                        Page 74   Article 15                              01-16                   C 2016 FannIe Mae  

 

      0)    If the Mortgage Loan  proceeds are disbursed on a date that is later than the  Effective Date, as described in Section 2.02(a)(I), the representations and warranties in the Loan  Documents with respect to the ownership and operation of the Mortgaged Property shall be  deemed to be made as of the disbursement date.  Section 15.09  Mortgage Loan Servicing.        All actions regarding the servicing of the Mortgage Loan, including the collection of  payments, the giving and receipt of notice, inspections of the Mortgaged Property, inspections of  books and records, and the granting of consents and approvals, may be taken by the Loan  Servicer unless Borrower receives notice to the contrary. If Borrower receives conflicting  notices regarding the identity of the Loan Servicer or any other subject, any such written notice  from Lender shall govern. The Loan Servicer may change from time to time (whether related or  unrelated to a sale of the Mortgage Loan). If there is a change of the Loan Servicer, Borrower  will be given written notice of the change.  Section 15.10  Disclosure of Information.        Lender may furnish information regarding Borrower, Key Principal, or Guarantor, or the  Mortgaged Property to third parties with an existing or prospective  interest in the servicing,  enforcement, evaluation, performance, purchase, or securitization of the Mortgage Loan,  including trustees, master servicers, special servicers, rating agencies, and organizations  maintaining databases on the underwriting and performance of multifamily mortgage loans.  Borrower irrevocably waives any and all rights it may have under applicable law to prohibit such  disclosure, including any right of privacy.  Section 15.11  Waiver; Conflict.        No specific waiver of any of the terms of this Loan Agreement shall be considered as a  general ..yaiver. If any provision of this Loan Agreement is in conflict with any provision of any  other Loan Document, the provision contained in this Loan Agreement shall control.  Section 15.12  No Reliance.        Borrower acknowledges, represents, and warrants that:        (a)   it understands the nature and structure of the transactions contemplated by this  Loan Agreement an? the other Loan Documents;        (b)   it is familiar with the provisions of all of the documents and instruments relating  to such transactions;        (c)   it understands the risks inherent in such transactions, including the risk of loss of  all or any part of the Mortgaged Property;        (d)   it has had the opportunity to consult counsel; and        (e)   it has not relied on Lender for any guidance or expertise in analyzing the financial  or other consequences of the transactions contemplated by this Loan Agreement or any other  Loan Document or otherwise relied on Lender in any manner in connection with interpreting,  entering into, or otherwise in connection with this Loan Agreement, any other Loan Document,  or any of the matters contemplated hereby or thereby.   Multifamily Loan and Security Agreement  (Non-Rccourse)                       Form 6001.NR                        Page 7S  Article 15                               01-16                   «) 2016 Fannie Mac  

 

Section 15.13  Subrogation.         If, and to the extent that, the proceeds of the Mortgage Loan are used to pay, satisfy, or  discharge any obligation of Borrower for the payment of money that is secured by a pre-existing  mortgage, deed of trust, or other lien encumbering the Mortgaged Property, such Mortgage Loan  proceeds shall be deemed to have been advanced by Lender at Borrower's request, and Lender  shall automatically, and without further action on its part, be subrogated to the rights, including  lien priority, of the owner or holder of the obligation secured by such prior lien, whether or not  such prior lien is released.   Section 15.14  Counting of Days.        Except where otherwise specifically provided, any reference in this Loan Agreement to a  period of "days" means calendar days, not Business Days. If the date on which Borrower is  required to perform an obligation under this Loan Agreement is not a Business Day, Borrower  shall be required to perform such obligation by the Business Day immediately preceding such  date; provided, however, in respect of any Payment Date, or if the Maturity Date is other than a  Business Day, Borrower shall be obligated to make such payment by the Business Day  immediately following such date.   Section 15.15  Revival and Reinstatement of Indebtedness.        If the payment of all or any part of the Indebtedness by Borrower, Guarantor, or any other  Person, or the transfer to Lender of any collateral or other property should for any reason  subsequently be declared to be void or voidable under any state or federal law relating to  creditors' rights, including provisions of the Insolvency Laws relating to a Voidable Transfer,  and if Lender is required to repay or restore, in whole or in part, any such Voidable Transfer, or  elects to do so upon the advice of its counsel, then the amount of such Voidable Transfer or the  amount of such Voidable Transfer that Lender is required or elects to repay or restore, including  all reasonable costs, expenses, and attorneys' fees incurred by Lender tn cOMection ·therewith,  and the Indebtedness shall be automatically revived, reinstated, and restored by such amount and  shall exist as though such Voidable Transfer had never been made.   Section 15.16  Time is of the Essence.        Borrower agrees that, with respect to each and every obligation and covenant contained  in this Loan Agreement and the other Loan Documents, time is of the essence.   Section 15.17  Final Agreement.         THIS   LOAN   AGREEMENT     ALONG    WITH  ALL   OF  THE   OTHER   LOAN  DOCUMENTS     REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES          WITH  RESPECT TO   THE  SUBJECT MATTER HEREOF      AND  MAY NOT BE CONTRADICTED  BY   EVIDENCE    OF   PRIOR,  CONTEMPORANEOUS,       OR   SUBSEQUENT     ORAL  AGREEMENTS.     THERE ARE NO UNWRITTEN      ORAL AGREEMENTS      BETWEEN THE  PARTIES.   All prior or contemporaneous agreements, understandings, representations, and  statements, oral or written, are merged into this Loan Agreement and the other Loan Documents.  This Loan Agreement, the other Loan Documents, and  any of their provisions may not be  waived, modified, amended, discharged, or terminated except by an agreement in writing signed   by the party against which the enforcement of the waiver, modification, amendment, discharge,  or termtnation is sought, and then only to the extent set forth in that agreement.     Multifamily Loan and Security Agreement   (Non-Recourse)                       Form 6001.NR                        Page 76   Anicl.15                                01-16                   C 2016 Fannie Mae  

 

Section 15.18  WAIVER OF TRIAL BY JURY.        TO THE  MAXIMUM     EXTENT  PERMITTED   BY  APPLICABLE   LAW,  EACH   OF  BORROWER AND     LENDER (a) COVENANTS    AND  AGREES NOT TO    ELECT A  TRIAL  BY JURY WITH RESPECT TO ANY ISSUE ARISING OUT OF THIS LOAN AGREEMENT  OR  ANY   OTHER   LOAN   DOCUMENT,    OR  THE   RELATIONSHIP   BETWEEN    THE  PARTIES  AS BORROWER AND     LENDER,   THAT  IS TRIABLE  OF RIGHT  BY A  JURY,  AND  (b) WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO         SUCH ISSUE  TO THE EXTENT THAT ANY SUCH RIGHT EXISTS NOW OR IN          THE FUTURE.   THIS  WAIVER OF RIGHT    TO TRIAL  BY JURY IS  SEPARATELY   GIVEN  BY EACH PARTY,  KNOWINGLY    AND   VOLUNTARILY    WITH   THE  BENEFIT  OF  COMPETENT    LEGAL  COUNSEL.        IN WITNESS WHEREOF, Borrower and    Lender have signed and delivered this Loan  Agreement under seal (where applicable) or have caused this Loan Agreement to be signed and  delivered under seal (where applicable) by their duly authorized representatives. Where  applicable law so provides, Borrower and Lender intend that this Loan Agreement shall be  deemed to be signed and delivered as a sealed instrument.                        [Remainder of Page Intentionally Blank)    Multifamily Loan and Security Agreement  (Non-Recourse)                       Form 6001.NR                        Page 77  Article 15                               01-16                   ~ 2016 Fannie Mae  

 

                                      BORROWER:                                         BRE JEFFERSON ST. ANDREWS OWNER                                          L     a Delaware limited liability company                                                                  r                                                    Illar~;,.6 Director and Vice President    Multifamily Loon and Security Agreement  (Non-Recourse)               .          Form 6001.NR                          Page Sol  Signature Page                              01-16                     C!) 2016 Fannie Mae  

 

                                    LENDER:                                      JONES LANG LASALLE MULTIFAMILY,                                         LLC, a Delaware limited liability company    Multifamily Loan and Security Agreement  (Non·Recourse)                        Form 6001.NR                          PalleS·2  Slln.lure Pile                            01·16                     C 2016 Fannie Mae  

 

                                 SCHEDULE 1              TO MULTIFAMILY LOAN AND SECURITY AGREEMENT                                Definitions Schedule             (Interest Rate Type - Structured ARM (1 and 3 Month LmOR»         Capitalized terms used in the Loan Agreement have the meanings given to such terms in  this Definitions Schedule.  "Accrued Interest" means unpaid interest, if any, on the Mortgage Loan that has not been added  to the unpaid principal balance of the Mortgage Loan pursuant to Section 2.02(b) (Capitalization  of Accrued But Unpaid Interest) of the Loan Agreement.  "Additional Lender Repairs" means repairs of the type listed on the Required Repair Schedule  but not otherwise identified thereon that are determined advisable by Lender to keep the  Mortgaged Property in good order and repair (ordinary wear and tear excepted) and in good  marketable condition or to prevent deteriomtion of the Mortgaged Property.  "Additional Lender Replacements" means replacements of the type listed on the Required  Replacement Schedule but not otherwise identified thereon that are determined advisable by  Lender to keep the Mortgaged Property in good order and repair (ordinary wear and tear  excepted) and in good marketable condition or to prevent deterioration of the Mortgaged  Property.  "Adjustable Rate" has the meaning set forth in the Summary of Loan Terms.  "Amortization Period" has the meaning set forth in the Summary of Loan Terms.  "Amortization Type" has the meaning set forth in the Summary of Loan Terms.  "Bank  Secrecy Act" means the Bank Secrecy Act of 1970, as amended (e.g., 31 U.S.C.  Sections 5311-5330).  "Bankruptcy Event" means anyone or more of the following:        (a)   the commencement, filing or continuation of a voluntary case or proceeding under  one or more of the Insolvency Laws by Borrower;        (b)   the acknowledgment in writing by Borrower (other than to Lender in connection  with a workout) that it is unable to pay its debts generally as they mature;        (c)   the making of a geneml assignment for the benefit of creditors by Borrower;        (d)   the commencement, filing or continuation of an involuntary case or proceeding  under one or more Insolvency Laws against Borrower; or        (e)   the appointment of a receiver( other than a receiver appointed at the direction or  request of Lender under the terms of the Loan Documents), liquidator, custodian, sequestmtor,  trustee or other similar officer who exercises control over Borrower or any substantial part of the  assets of Borrower;   Schcdule 1 to Multifamily Loan and  Security Agreement - Definitions Schedule  (Interest Rate Type - SARM)         Form 6101.SARM                        Page 1  Fannie Mae                               _-17                    02017 Fannie Mae  

 

provided, however, that any proceeding or case under (d) or (e) above shall not be a Bankruptcy  Event until the ninetieth (90th) day after filing (if not earlier dismissed) so lon~ as such  proceeding or case occurred without the consent, encouragement or active participation of  (1) Borrower, Guarantor, or Key Principal, (2) any Person Controlling Borrower, Guarantor, or  Key Principal, or (3) any Person Controlled by or under common Control with Borrower,  Guarantor, or Key Principal (in which event such case or proceeding shall be a Bankruptcy Event  immediately).  "Blackstone Fund" means the real estate opportunity fund commonly known as  Blackstone Real Estate Partners VIII.   "Borrower" means, individually {and jointly and severally (solidarily instead for purposes of  Louisiana law) if more than one), the entity (or entities) identified as "Borrower" in the first  paragraph of the Loan Agreemenl  "Borrower Affiliate" means, as to Borrower, Guarantor or Key Principal:       (a)   any Person that owns any direct ownership interest in Borrower, Guarantor or  Key Principal;       (b)   any Person that indirectly owns, with the power to vote, twenty percent (20%) or  more of the ownership interests in Borrower, Guarantor or Key Principal;       (c)   any Person Controlled by, under common Control with, or which Controls,  Borrower, Guarantor or Key Principal;        (d)  any entity in which Borrower, Guarantor or Key Principal directly or indirectly  owns, with the power to vote, twenty percent (20%) or more of the ownership interests in such  entity; or        (e)  any other individual that is related (to the third degree of consanguinity) by blood  or marriage to Borrower, Guarantor or Key Principal.  "Borrower Requested Repairs" means repairs not listed on the Required Repair Schedule  requested by Borrower to be reimbursed from the Repairs Escrow Account and determined  advisable by Lender to keep the Mort~aged Property in good order and repair and in a good  marketable condition or to prevent detenoration of the Mortgaged Property.  "Borrower Requested Replacements" means replacements not listed on the Required  Replacement Schedule requested by Borrower to be reimbursed from the Replacement Reserve  Account and determined advisable by Lender to keep the Mortgaged Property in good order and  repair and in a good marketable condition or to prevent deterioration of the Mortgaged Property.  "Borrower's General Business Address" has the meaning set forth in the Summary of Loan  Terms.  "Borrower's Notice Address" has the meaning set forth in the Summary of Loan Terms.  "BREP"  means Blackstone Real Estate Partners VllI L.P., Blackstone Real Estate Partners  VIII.TE.l L.P., Blackstone Real Estate Partners VIII.TE.2 L.P., Blackstone Real Estate  Partners VIII.F (AV) L.P., Blackstone Real Estate Holdings VIII-ESC L.P., BTAS Q   Schedule I to Multiramily Loan and  Security Agreement - Definitions Schedule  (Interest Rate Type - SARM)      Form 6101.SARM                    Page 2  Fannie Mae                           _-17                  02017 Fannie Mae  

 

Holdings L.L.C., and Blackstone Family Real Estate Partnership VIII-SMD L.P., each a  Delaware limited partnership or limited liability company, as applicable, and any affiliated  partnerships under common control which comprise the Blackstone Fund.  "BREP Affiliate" means BREP andlor any wholly-owned subsidiary or affiliate ofBREP.   "BREP Prohibited Person" means:         (a)  any Person with whom Lender or Fannie Mae is prohibited from doing  business pursuant to any law, rule, regulation, judicial proceeding or an administrative  directive of a Governmental Authority; or        (b)  any Person identified on the United States Department of Housing and  Urban Development's "Limited Denial of Participation, HUD Funding Disqualifications and  Voluntary Abstentions List," or on the General Services Administration's "Excluded Parties  List System," each of which may be amended from time to time, and any successor or  replacement thereof; or        (c)  any Person that is determined by Fannie Mae to pose an unacceptable credit   risk due to the aggregate amount of debt of such Person currently held,  owned or committed   to by Fannie Mae, in any form, that would, after taking into consideration the Transfer,  exceed $3 Billion Dollars.   "Business Day" means any day other than (a) a Saturday, (b) a Sunday, (c) a day on which  Lender is not open for business, or (d) a day on which the Federal Reserve Bank of New York is  not open for business.  "Collateral Account Funds" means, collectively, the funds on deposit in any or all of the  Collateral Accounts, including the ReservelEscrow Account Funds.  "Collateral Accounts" means any account designated as such by Lender pursuant to a Collateral  Agreement or as established pursuant to this Loan Agreement, including the ReservelEscrow  Account.  "Collateral Agreement" means any separate agreement between Borrower and Lender and any  other party for the establishment of any other fund, reserve or account affecting the Mortgage  Loan.  "Completion Period" has the meaning set forth in the Summary of Loan Terms.  "Condemnation Action" has the meaning set forth in the Security Instrument.  "Control" (including with correlative meanings, such as "Controlling," "Controlled by" and  "under common Control with") means, as applied to any entity, the possession, directly or  indirectly, of the power to direct or cause the direction of the management and operations of such  entity, whether through the ownership of voting securities or other ownership interests, by  contract or otherwise.    Schedule I to Multifamily Loan and  Security Agreement - Definitions Schedule  (Interest Rate Type - SARM)     Form 610l.SARM                     Page 3  Fannie Mae                          _-17                   IC 2017 Fannie Mae  

 

entity, whether through the ownership of voting securities or other ownership interests, by  contract or otherwise.  "Conversion" means the conversion of the Mortgage Loan from an adjustable rate to a fixed rate  and, if applicable, the extension of the Maturity Date of the Mortgage Loan to the New Maturity  Date.  "Conversion Amendment" means  Lender's then-current form of Amendment to Multifamily  Loan and Security Agreement to be executed by Borrower and Lender to amend or restate all or  any part of this Loan Agreement (including any Schedules, Exhibits or other attachments) in  connection with, and reflecting the terms of, a Conversion of the Mortgage Loan.  "Conversion Closing Date" means, after Borrower exercises the Conversion Option, the date  desilP'ated by Lender for the closing of the Conversion which date (a) is a Business Day, (b) is  withm the Conversion Period, and (c) is not more than ten (10) days after the Conversion  Exercise Date.  "Conversion Effective Date" means, if the Conversion Exercise Date occurs on a Payment  Date, the first (1st) day of the calendar month following the Conversion Exercise Date, or, if the  Conversion Exercise Date occurs on any other day other than a Payment Date, the first (1st) day  of the second (2nd) calendar month following the Conversion Exercise Date, but in no event  shall the Conversion Effective Date be after the last day of the Conversion Period.  "Conversion Exercise Date" means the date that Borrower accepts the rate quote provided by  Lender in connection with Borrower's Rate Lock Request.  "Conversion Option" means Borrower's one-time option to effect the Conversion pursuant to  the terms of the Loan Agreement.  "Conversion Period" means the period commencing on the first (1st) day of the second (2nd)  Loan Year and ending on the first (I st) day of the third (3rd) month prior to the Maturity Date of  the Mortgage Loan.  "Conversion Review Fee" has the meaning set forth in the Summary of Loan Terms.  "Credit Score" means a numerical value or a categorization derived from a statistical tool or  modeling system used to measure credit risk and predict the likelihood of certain credit  behaviors, including default.  "Current Index" has the meaning set forth in the Summary of Loan Terms.  "Debt Service Amounts" means the Monthly Debt Service Payments and all other amounts  payable under the Loan Agreement, the Note, the Security Instrument or any other Loan  Document.    Schedule I to Multifamily Loan and  Security Agreement - DeOnltlons Schedule  (Interest Rate Type - SARM)         Form 6101.SARM                        Page 4   Fannie Mae                              _ -17                   C 2017 Fannie Mae  

 

"Conversion" means the conversion of the Mortgage Loan from an adjustable rate to a fixed rate  and, if applicable, the extension of the Maturity Date of the Mortgage Loan to the New Maturity  Date.   "Conversion Amendment" means  Lender's then-current form of Amendment to Multifamily  Loan and Security Agreement to be executed by Borrower and Lender to amend or restate all or  any part of this Loan Agreement (including any Schedules, Exhibits or other attachments) in  connection with, and reflecting the terms of, a Conversion of the Mortgage Loan.   "Conversion Closing Date" means, after Borrower exercises the Conversion Option, the date  desi~ated by Lender for the closing of the Conversion which date (a) is a Business Day, (b) is  within the Conversion Period, and (c) is not more than ten (10) days after the Conversion  Exercise Date.   "Conversion Effective Date" means, if the Conversion Exercise Date occurs on a Payment  Date, the first (1 st) day of the calendar month following the Conversion Exercise Date, or, if the  Conversion Exercise Date occurs on any other day other than a Payment Date, the first (1st) day  of the second (2nd) calendar month following the Conversion Exercise Date, but in no event   shall the Conversion Effective Date be after the last day of the Conversion Period.   "Conversion Exercise Date" means the date that Borrower accepts the rate quote provided by  Lender in connection with Borrower's Rate Lock Request.   "Conversion Option" means Borrower's one-time option to effect the Conversion pursuant to  the terms of the Loan Agreement.   "Conversion Period" means the period commencing on the first (1st) day of the second (2nd)  Loan Year and ending on the first (1st) day of the third (3rd) month prior to the Maturity Date of  the Mortgage Loan.    "Conversion Review Fee" has the meaning set forth in the Summary of Loan Terms.    "Credit Score" means a numerical value or a categorization derived from a statistical tool or   modeling system used to measure credit risk and predict the likelihood of certain credit   behaviors, including default.    "Current Index" has the meaning set forth in the Summary of Loan Terms.    "Debt Service Amounts" means the Monthly Debt Service Payments and all other amounts   payable under the Loan Agreement, the Note, the Security Instrument or any other Loan   Document.     Schedule 1 to Multifamily Loan and   Security Aareement - Definitions Schedule   (Interest Rate Type - SARM)        Form 6101.SARM                        Page 4   Fannie Mae                              _-17                    02017 Fannie Mae  

 

"Debt Service Coverage Ratio" means the ratio of (a) the Net Cash Flow of the Mortgaged  Property, to (b) the underwritten debt service for the Mortgage Loan at the proposed Fixed Rate  for the trailing twelve (12) month period from the date of the most recently received quarterly  financial statements prepared by Borrower for the Mortgaged Property, provided that (1) the  interest rate used in determining such ratio shall be the greater of (A) the Fixed Rate, or (B) the  Underwriting Interest Rate (if any), and (2) an Amortization Period of three hundred sixty (360)  months shall be used in determining such ratio.  "Default Rate" means an interest rate equal to the lesser of:        (a)   the sum of the Interest Rate plus four (4) percentage points; or        (b)   the maximum  interest rate which may be collected from Borrower under  applicable law.  "Definitions Schedule" means this Schedule 1 (Definitions Schedule) to the Loan Agreement.   "Economic Sanctions" means any economic or financial sanction administered or enforced by  the United States Government (including, without limitation, those administered by OF AC at  http://www.treasury.gov/about!organizational-structure/officeslPages/Office-of-Foreign-Assets­ Control.aspx), the U.S. Department of Commerce, or the U.S. Department of State.  "Effective Date" has the meaning set forth in the Summary of Loan Terms.  "Employee Benefit Plan" means a plan described in Section 3(3) of ERISA which is subject to  Title I of ERISA.  "Enforcement Costs" has the meaning set forth in the Security Instrument.  "Environmental Indemnity  Agreement"  means  that certain Environmental Indemnity  Agreement dated as of the Effective Date made by Borrower to and for the benefit of Lender, as  the same may be amended, restated, replaced, supplemented, or otherwise modified from time to  time.  "Environmental Inspections" has the meaning set forth in the Environmental Indemnity  Agreement.  "Environmental Laws" has the meaning set forth in the Environmental Indemnity Agreement.  "ERISA" means the Employee Retirement Income Security Act of 1974, as amended.  "ERISA  Affiliate" shall mean, with respect to Borrower, any entity that, together with  Borrower,  would be treated as a single employer under Section 414(b) or (c) of the Internal  Revenue Code, or Section 4001 (a)(14) of ERISA, or the regulations thereunder.  "ERISA Plan" means any employee pension benefit plan within the meaning of Section 3(2) of  ERISA (or related trust) that is subject to the requirements of Title IV of ERISA, Sections 430 or  431 of the Internal Revenue Code, or Sections 302, 303, or 304 of ERISA, which is maintained  or contributed to by Borrower or its ERISA Affiliates.  "Event of Default" means the occurrence of any event listed in Section 14.01 (Events of  Default) of the Loan Agreement.   Schedule 1 to Multiramily Loan and  Security Agreement - Definitions Schedule  (Interest Rate Type - SARM)         Form 6IOI.SARM                        PageS  Fannie Mac                               _-17                    II:> 2017 Fannie Mae  

 

"Exceptions to Representations and Warranties Schedule" means that certain Schedule 7  (Exceptions to Representations and Warranties Schedule) to the Loan Agreement.  "First Payment Date" has the meaning set forth in the Summary of Loan Terms.  "First Principal and Interest Payment Date" has the meaning set forth in the Summary of  Loan Terms, if applicable.  "Fixed Monthly Principal Component" has the meaning set forth in the Summary of Loan  Terms.  "Fixed Rate" means an interest rate per annum equal to the sum of the Investor Yield, the  Servicing Fee and the Guaranty Fee.  "Fixed Rate Amortization Factor" has the meaning set forth in the Summary of Loan Terms.  "Fixed Rate O·ption" means, in connection with a Conversion, Borrower's selection of one (1)  of the following fixed rate options for the Mortgage Loan, which shall be effective from and  after the Conversion Effective Date:        (a)   seven (7) year term with a five (5) year yield maintenance period;         (b)   seven (7) year term with a six and one-half (6.5) year yield maintenance period;        (c)   ten (10) year term with a seven (7) year yield maintenance period; or        (d)   ten (10) year term with a nine and one-half(9.5) year yield maintenance period.  "Fixtures" has the meaning set forth in the Security Instrument.  "Force Majeure" shall mean acts of God, acts of war, civil disturbance, governmental action  (including the revocation or refusal to grant licenses or permits, where such revocation or refusal  is not due to the fault of Borrower), strikes, lockouts, fire, unavoidable casualties or any other  causes beyond the reasonable control of Borrower (other than lack of financing), and of which  Borrower shall have notified Lender in writing within ten (10) days after its occurrence.  "Foreclosure Event" means:        (a)   foreclosure under the Security Instrument;        (b)   any other exercise by Lender of rights and remedies (whether under the Security  Instrument or under applicable law, including Insolvency Laws) as holder of the Mortgage Loan  and/or the Security Instrument, as a result of which Lender (or its designee or nominee) or a third  party purchaser becomes owner of the Mortgaged Property;        (c)   delivery by Borrower to Lender (or its designee or nominee) of a deed or other  conveyance of Borrower's interest in the Mortgaged Property in lieu of any of the foregoing; or        (d)    in Louisiana, any dation en paiement.    Schedule I to Multifamily Loan and  Security Allreement - Definitions Schedule  (Interest Rate Type - SARM)         Form 610l.SARM                        Page 6   Fannie Mae                              _-17                    02017 Fannie Mae  

 

"Good Faith Deposit" means a fee in an amount equal to two percent (2%) of the unpaid  principal balance of the Mortgage Loan immediately prior to the Initial Fixed Rate Payment  Date.  "Goods" has the meaning set forth in the Security Instrument.  "Governmental Authority" means any court, board, commission, department or body of any  municipal, county, state or federal governmental unit, or any subdivision of any of them, that has  or acquires jurisdiction over Borrower or the Mortgaged Property or the use, operation or  improvement of the Mortgaged Property.  "Guarantor" means, individually and collectively, any guarantor of the Indebtedness or any  other obligation of Borrower under any Loan Document.  "Guarantor Bankruptcy Event" means anyone or more of the following:        (a)   the commencement, filing or continuation of a voluntary case or proceeding under  one or more of the Insolvency Laws by Guarantor;         (b)   the acknowledgment in writing by Guarantor (other than to Lender in connection  with a workout) that it is unable to pay its debts generally as they mature;        (c)   the making of a general assignment for the benefit of creditors by Guarantor;        (d)   the commencement, filing or continuation of an involuntary case or proceeding  under one or more Insolvency Laws against Guarantor; or        (e)   the appointment of a receiver, liquidator, custodian, sequestrator, trustee or other  similar officer who exercises control over Guarantor or any substantial part of the assets of  Guarantor, as applicable;  provided, however, that any proceeding or case under (d) or (e) above shall not be a Guarantor  Bankruptcy Event until the ninetieth (90th) day after filing (if not earlier dismissed) so long as  such proceeding or case occurred without the consent, encouragement or active participation of  (1) Borrower, Guarantor or Key Principal, (2) any Person Controlling Borrower, Guarantor or  Key Principal, or (3) any Person Controlled by or under common Control with Borrower,  Guarantor or Key Principal (in which event such case or proceeding shall be a Guarantor  Bankruptcy Event immediately).  "Guarantor's General Business Address" has the meaning set forth in the Summary of Loan  Terms.  "Guarantor's Notice Address" has the meaning set forth in the Summary of Loan Terms.  "Guaranty"  means, individually and collectively, any Payment Guaranty, Non-Recourse  Guaranty or other guaranty executed by Guarantor in connection with the Mortgage Loan.  "Guaranty Fee" has the meaning set forth in the Summary of Loan Terms.  "Immediate Family Members" means a child, stepchild, grandchild, spouse, sibling, or parent,  each of whom is not a Prohibited Person.   Schedule I to Multifamily Loan and  Security Agreement - Definitions Schedule  (Interest Rate Type - SARM)         Form 6101.SARM                        Page 7  Fannie Mae                              __ 17                    C> 2017 Fannie Mae  

 

"Imposition Deposits" has the meaning set forth in the Security Instrument.  "Impositions" has the meaning set forth in the Security Instrument.  "Improvements" has the meaning set forth in the Security Instrument.  "Indebtedness" has the meaning set forth in the Security Instrument.  "Index" has the meaning set forth in the Swnmary of Loan Terms.   "Initial Adjustable Rate" has the meaning set forth in the Swnmary of Loan Terms.  "Initial Fixed Rate Payment Date" means the first (1st) day of the calendar month following  the Conversion Effective Date.  "Initial Monthly Debt Service Payment" has the meaning set forth in the Summary of Loan  Terms.  "Initial Replacement Reserve Deposit" has the meaning set forth in the Swnmary of Loan  Terms.  "Insolvency Laws" means the United States Bankruptcy Code, II U.S.C. Section 101, et seq.,  together with any other federal or state law affecting debtor and creditor rights or relating to the  bankruptcy, insolvency, reorganization, arrangement, moratorium, readjustment of debt,  dissolution, liquidation or similar laws, jroceedings, or equitable princIples affecting the  enforcement of creditors' rights, as amende from time to time.  "Insolvent" means:        (a)   that the sum total of all of a specified Person's liabilities (whether secured or  unsecured, contingent or fixed, or liquidated or unliquidated) is in excess of the value of such  Person's non-exempt assets, i.e., all of the assets of such Person that are available to satisfy  claims of creditors; or         (b)   such Person's inability to pay its debts as they become due.  "Intended Prepayment  Date" means the date upon which Borrower intends to make a  prepayment on the Mortgage Loan, as set forth in the Prepayment Notice.  "Interest Accrual Method" has the meaning set forth in the Swnmary of Loan Terms.  "Interest Only Term" has the meaning set forth in the Swnmary of Loan Terms.  "Interest Rate" means the Initial Adjustable Rate or the Adjustable Rate, as applicable.  "Interest Rate Type" has the meaning set forth in the Swnmary of Loan Terms.  "Internal Revenue Code" means the Internal Revenue Code of 1986, as amended.    Schedule I to Multifamily Loan and  SecurIty Allreement - Definitions Schedule  (Inlerest Rate Type - SARM)         Form 6101.SARM                        PageS   Fannie Mae                              _-17                    II:> 2017 Fannie Mae  

 

 "Investor" means any Person to whom Lender intends to (a) sell, transfer, deliver or assign the   Mortgage Loan in the secondary mortgage market, or (b) sell an MBS backed by the Mortgage   Loan.   "Investor Yield" means, in connection with a Conversion, the percentage equal to (a) the   required net yield offered for purchase by Fannie Mae or (b) the MBS pass-through rate offered   for purchase by regular buyers of mortgage backed securities, as applicable, for a new Fannie   Mae mortgage loan with the same or substantially similar loan terms and credit characteristics as   the Mortgage Loan (taking into account the Fixed Rate Option selected by Borrower).   "Key Principal" means, collectively:         (a)   the natural person(s) or entity that Controls Borrower that Lender determines is   critical to the successful operation and management of Borrower and the Mortgaged Property, as   identified as such in the Summary of Loan Terms; or         (b)   any natural person or entity who becomes a Key Principal after the date of the   Loan Agreement and is identified as such in an assumption agreement, or another amendment or   supplement to the Loan Agreement.   "Key Principal's General Business Address" has the meaning set forth in the Summary of   Loan Terms.   "Key Principal's Notice Address" has the meaning set forth in the Summary of Loan Terms.   "Land" means the land described in Exhibit A to the Security Instrument.   "Last Interest Only Payment Date" has the meaning set forth in the Summary of Loan Terms,   if applicable.   "Late Charge" means an amount equal to the delinquent amount then due under the Loan   Documents multiplied by five percent (5%).   "Leases" has the meaning set forth in the Security Instrument.   "Lender" means the entity identified as "Lender" in the first paragraph of the Loan Agreement   and its transferees, successors and assigns, or any subsequent holder of the Note.   "Lender's General Business Address" has the meaning set forth in the Summary of Loan   Terms.   "Lender's Notice Address" has the meaning set forth in the Summary of Loan Terms.   "Lender's Payment Address" has the meaning set forth in the Summary of Loan Terms.   "Lien" has the meaning set forth in the Security Instrument.   "Loan  Agreement" means the Multifamily Loan and Security Agreement dated as of the   Effective Date executed by and between Borrower and Lender to which this Definitions   Schedule is attached, as the same may be amended, restated, replaced, supplemented or  I otherwise modified from time to time.    Schcdule I to Multifamily Loan and   Security Agreement - Definitions Schedule   (Interest Rate Type - SARM)         Form 6101.SARM                        Page 9   Fannie Mae                               _-17                    C> 2017 Fannie Mae  

 

"Loan Amount" has the meaning set forth in the Summary of Loan Terms.   "Loan Application" means the application for the Mortgage Loan submitted by Borrower to  Lender.   "Loan  Documents" means  the Note, the Loan Agreement, the Security Instrument, the  Environmental Indemnity Agreement, the Guaranty, all guaranties, all indemnity agreements, all  Collateral Agreements, all O&M Plans, and any other documents now or in the future executed  by Borrower, Guarantor, Key Principal, any other guarantor or any other Person in connection  with the Mortgage Loan, as such documents may be amended, restated, replaced, supplemented  or otherwise modified from time to time.   "Loan Servicer" means the entity that from time to time is designated by Lender to collect  payments and deposits and receive notices under the Note, the Loan Agreement, the Security  Instrument and any other Loan Document, and otherwise to service the Mortgage Loan for the  benefit of Lender. Unless Borrower receives notice to the contrary, the Loan Servicer shall be  the Lender originally named on the Summary of Loan Terms.   "Loan Term" has the meaning set forth in the Summary of Loan Terms.   "Loan Year" has the meaning set forth in the Summary of Loan Terms.   "Margin" has the meaning set forth in the Summary of Loan Terms.   "Material Commercial Lease" means:         (a)   any Lease that comprises five percent (5%) or more of the total gross income at  the Mortgaged Property on an annualized basis; or         (b)   regardless of the percentage of the total gross income at the Mortgaged Property  that it comprises, any Lease relating to:               (\)   solar power, thermal power generation, or co-power generation, or for the        installation of solar panels or any other electrical power generation equipment, and any        related power purchase agreement;               (2)   mineral rights or rights relating to subsurface oil and/or natural gas;               (3)   telecommunications or a cell tower; or               (4)   any dwelling unit at the Mortgaged Property leased to Guarantor, Key        Principal, or another Borrower Affiliate.   "Maturity Date" has the meaning set forth in the Summary of Loan Terms.   "Maximum Fixed Rate" means the maximum Fixed Rate to which the Mortgage Loan may be  converted, as determined by Lender, so that the Debt Service Coverage Ratio of the Mortgage  Loan is not less than the Minimum Conversion Debt Service Coverage Ratio.   "Maximum Inspection Fee" has the meaning set forth in the Summary of Loan Terms.    Schedule I to Multifamily Loan and  Security Agreement - Definitions Schedule  (Interest Rate Type - SARM)         Form 610l.SARM                       Page 10   Fannie Mae                              _-17                    C 2017 Fannie Mae  

 

"Maximum Repair Cost" shall be the amount(s) set forth in the Required Repair Schedule, if  any.  "Maximum Repair Disbursement Interval" has the meaning set forth in the Summary of Loan  Terms.  "Maximum Replacement Reserve  Disbursement Interval" has the meaning set forth in the  Summary of Loan Terms.  "MBS" means an investment security that represents an undivided beneficial interest in a pool of  mortgage loans or participation interests in mortgage loans held in trust pursuant to the terms of a  governing trust document.  "Mezzanine Debt" means a loan to a direct or indirect owner of Borrower secured by a pledge  of such owner's interest in an entity owning a direct or indirect interest in Borrower.  "Minimum  Conversion Debt  Service Coverage Ratio" has the meaning set forth in the  Summary of Loan Terms.  "Minimum  Repairs Disbursement Amount"  has the meaning set forth in the Summary of  Loan Terms.  "Minimum Replacement Reserve  Disbursement Amount" has the meaning set forth in the  Summary of Loan Terms.  "Monthly Debt Service Payment" has the meaning set forth in the Summary of Loan Terms.  "Monthly Replacement Reserve Deposit" has the meaning set forth in the Summary of Loan  Terms.  "Mortgage Loan"  means the mortgage loan made by Lender to Borrower in the principal  amount of the Note made pursuant to the Loan Agreement, evidenced by the Note and secured  by the Loan Documents that are expressly stated to be security for the Mortgage Loan.  "Mortgaged Property" has the meaning set forth in the Security Instrument.  "Multifamily Project" has the meaning set forth in the Summary of Loan Terms.  "Multifamily Project Address" has the meaning set forth in the Summary of Loan Terms.  "Multifamily Residential Property" means a residential property, located in the United States,  containing five (5) or more dwelling units in which not more than ten percent (10%) of the net  rentable area is or will be rented to non-residential tenants, and conforming to Underwriting and  Servicing Requirements.  "NCF Determination Notice" means the notice given by Lender to Borrower pursuant to the  Conversion Option in which Lender establishes the Net Cash Flow and the Maximum Fixed Rate  to which the Mortgage Loan may be converted.  "NCF Determination Request" means the notice given by Borrower to Lender to exercise the  Conversion Option in which Borrower requests that Lender determines the Net Cash Flow and  the Maximum Fixed Rate to which the Mortgage Loan may be converted.   Schedule I to Multifamily Loan and  Security Agreement - Definitions Schedule  (Interest Rate Type - SARM)         Form 6101.SARM                       Page 11  Fannie Mac                              _-17                     (l:) 2017 Fannie Mac  

 

"Net Cash Flow" means, for any specified period, the total of (a) the net rental income for the  Mortgaged Property, plus (b) other allowable income for the Mortgaged Property, if any, minus  (c) operating expenses for the Mortgaged Property, minus (d) the full amount underwritten for  the Replacement Reserve Account (regardless of whether deposits have been or will be waived  or reduced), and as adjusted for economic vacancy and other factors by Lender for the specific  asset class or loan type.  "New  Maturity Date" means  the Maturity Date of the Mortgage Loan following the  Conversion, as set forth on the Summary of Loan Terms attached as Schedule 2 to the  Conversion Amendment, which date may be the same as, or later than, the Maturity Date prior to  the exercise of the Conversion.  "Non-Recourse Guaranty"  means, if applicable, that certain Guaranty of Non-Recourse  Obligations of even date herewith executed by Guarantor to and for the benefit of Lender, as the  same may be amended, restated, replaced, supplemented or otherwise modified from time to  time.   "Note" means that certain Multifamily Note of even date herewith in the original principal  amount of the stated Loan Amount made by Borrower in favor of Lender, and all schedules,  riders, a1longes and addenda attached thereto, as the same may be amended, restated, replaced,  supplemented or otherwise modified from time to time.  "O&M Plan" has the meaning set forth in the Environmental Indemnity Agreement.  "OFAC" means  the United States Treasury Department, Office of Foreign Assets Control, and  any successor thereto.  "Payment Change Date" has the meaning set forth in the Summary of Loan Terms.   "Payment Date" means the First Payment Date and the first (151) day of each month thereafter  until the Mortgage Loan is fully paid.  "Payment  Guaranty" means, if applicable, that certain Guaranty (payment) of even date  herewith executed by Guarantor to and for the benefit of Lender, as the same may be amended,  restated, replaced, supplemented or otherwise modified from time to time.  "Permitted Eneumbrance" has the meaning set forth in the Security Instrument.  "Permitted Mezzanine Debt" means Mezzanine Debt incurred by a direct or indirect owner or  owners of Borrower where the exercise of any of the rights and remedies by the holder or holders  of the Mezzanine Debt would not in any circumstance cause (a) a change in Control in Borrower,  Key  Principal, or Guarantor, or (b) a Transfer of a direct or indirect Restricted Ownership  Interest in Borrower, Key Principal, or Guarantor.  "Permitted Preferred Equity" means Preferred Equity that does not (a) require mandatory  dividends, distributions, payments or returns (including at maturity or in connection with a  redemption), provided that Preferred Equity in BREP or any direct or indirect owners of BREP  shall be considered Permitted Preferred Equity, subject to the requirements of Section II.03(h),  or (b) provide the Preferred EQuity owner with rights or remedies on account of a failure to  receive any preferred dividends, distributions, payments or returns (or, if such rights are  provided, the exercise of such rights do not violate the Loan Documents or are otherwise  exercised with the prior written consent of Lender in accordance with Article II (Liens,   Schedule t to Multifamily Loan and  Security Allreement - Dennltlons Schedule  (Interest Rate Type - SARM)         Form 6101.SARM                       Page 12   Fannie Mae                              _-17                    C> 2017 Fannie Mae  

 

Transfers and Assumptions) of the Loan Agreement and the payment of all applicable fees and  expenses as set forth in Section 11.03(g) (Further Conditions to Transfers and Assumption».  "Permitted Prepayment Date" means the last Business Day of a calendar month.  "Person" means an individual, an estate, a trust, a corporation, a partnership, a limited liability  company or any other organization or entity (whether governmental or private).  "Personal Property" means the Goods, accounts, choses of action, chattel paper, documents,  general intangibles (including Software), payment intan~ibles, instruments, investment property,  letter of credit rights, supporting obligations, computer Information, source codes, object codes,  records and data, all telephone numbers or listings, claims (including claims for indemnity or  breach of warranty), deposit accounts and other property or assets of any kind or nature related to  the Land or the Improvements, including operating agreements, surveys, plans and specifications  and contracts for architectural, engineering and construction services relating to the Land or the  Improvements, and all other intangible property and rights relating to the operation of, or used in  connection with, the Land or the Improvements, including all governmental permits relating to  any activities on the Land.  "Personalty" has the meaning set forth in the Security Instrument.  "Preferred Equity" means a direct or indirect equity ownership interest in, economic interests  in, or rights with respect to, Borrower that provide an equity owner preferred dividend,  distribution, payment, or return treatment relative to other equity owners.  "Prepayment Lockout Period" has the meaning set forth in the Summary of Loan Terms.  "Prepayment Notice" means the written notice that Borrower is required to provide to Lender in  accordance with Section 2.03 (LockoutlPrepayment) of the Loan Agreement in order to make a  prepayment on the Mortgage Loan, which shall include, at a minimum, the Intended Prepayment  Date.  "Prepayment  Premium"  means the amount payable by Borrower in connection with a  prepayment of the Mortgage Loan, as provided in Section 2.03 (LockoutlPrepayment) of the  Loan Agreement and calculated in accordance with the Prepayment Premium Schedule.  "Prepayment  Premium  Schedule" means that certain Schedule 4 (prepayment Premium  Schedule) to the Loan Agreement.  "Prepayment Premium Term" has the meaning set forth in the Summary of Loan Terms.  "Prohibited Person" means:        (a)   any Person with whom Lender or Fannie Mae is prohibited from doing business  pursuant to any law, rule, regulation, judicial proceeding or administrative directive; or        (b)   any Person identified on the United States Department of Housing and Urban  Development's "Limited Denial of Participation, HUD Funding Disqualifications and Voluntary  Abstentions List," or on the General Services Administration's "System for Award Management  (SAM)" exclusion list, each of which may be amended from time to time, and any successor or  replacement thereof; or   Schedule 1 to Multifamily Loan and  Security Agreement - Definitions Schedule  (Interest Rate Type - SARM)         Form 6101.SARM                       Page 13  Fannie Mae                              _-17                     C2017 Fannie Mae  

 

     (c)   any Person that is detennined by Fannie Mae to pose an unacceptable credit risk  due to the aggregate amount of debt of such Person owned or held by Fannie Mae; or       (d)   any Person that has caused any unsatisfactory experience of a material nature with  Fannie Mae or Lender, such as a default, fraud, intentional misrepresentation, litigation,  arbitration or other similar act.  "Property Jurisdiction" has the meaning set forth in the Security Instrument.  "Property Square Footage" has the meaning set forth in the Summary of Loan Tenns.  "Publicly-Held Corporation" means a corporation, the outstanding voting stock of which is  registered under Sections 12(b) or 12(g) of the Securities Exchange Act of 1934, as amended.  "Publicly-Held Trust" means a real estate investment trust, the outstanding voting shares or  beneficial interests of which are registered under Sections 12(b) or 12(g) of the Securities  Exchange Act of 1934, as amended.  "Rate Change Date" has the meaning set forth in the Summary of Loan Tenns.  "Rate Lock Request" means a request from Borrower to Lender for a rate quote for the Fixed  Rate (based on the Fixed Rate Option selected by Borrower) which shall apply after the  Conversion Effective Date.  "Rents" has the meaning set forth in the Security Instrument.  "Repair Threshold" has the meaning set forth in the Summary of Loan Tenns.  "Repairs" means, individually and collectively, the Required Repairs, Borrower Requested  Repairs, and Additional Lender Repairs.  "Repairs Escrow Account" means the account established by Lender into which the Repairs  Escrow Deposit is deposited to fund the Repairs.  "Repairs Escrow Account Administrative Fee" has the meaning set forth in the Summary of  Loan Tenns.  "Repairs Escrow Deposit" has the meaning set forth in the Summary of Loan Tenns.  "Replacement  Property Manager" means a property manager approved by Lender in  accordance with Section 6.03(a) (property Management) of the Loan Agreement.  "Replacement Reserve Account" means the account established by Lender into which the  Replacement Reserve Deposits are deposited to fund the Replacements.  "Replacement Reserve Account Administration Fee" has the meaning set forth in the  Summary of Loan Tenns.  "Replacement Reserve Account Interest Disbursement Frequency" has the meaning set forth  in the Summary of Loan Tenns.    Schedule I to Multifamily Loan and  Seeurlty Al:reement - Definitions Schedule  (Interest Rate Type - SARM)      Form 6101.SARM                    Page 14  Fannie Mae                           _-17                  Q 2017 Fannie Mae  

 

"Replacement Reserve Deposits" means the Initial Replacement Reserve Deposit, Monthly  Replacement Reserve Deposits and  any other deposits to the Replacement Reserve Account  required by the Loan Agreement.   "Replacement Threshold" has the meaning set forth in the Summary of Loan Terms.   "Replacements" means. individually and collectively. the Required Replacements. Borrower  Requested Replacements and Additional Lender Replacements.  "Required Repair Schedule" means that certain Schedule 6 (Required Repair Schedule) to the  Loan Agreement.   "Required Repairs" means those items listed on the Required Repair Schedule.   "Required Replacement Schedule" means that certain Schedule 5 (Required Replacement  Schedule) to the Loan Agreement.   "Required Replacements" means those items listed on the Required Replacement Schedule.   "ReservelEscrow Account  Funds"  means. collectively. the funds on deposit in the  ReservelEscrow Accounts.   "ReservelEscrow Accounts" means. together. the Replacement Reserve Account and the  Repairs Escrow Account.  "Residential Lease" means a Lease of an individual dwelling unit.  "Restoration" means restoring and repairing the Mortgaged Property to the equivalent of its  physical condition immediately prior to the casualty or to a condition approved by Lender  following a casualty.   "Restricted Ownership Interest" means. with respect to any entity. the following:        (a)   if such entity is a general partnership or a joint venture. fifty percent (50%) or  more of all general partnership or joint venture interests in such entity;         (b)   if such entity is a limited partnership:               (I)   the interest of any general partner; or               (2)   fifty percent (50%) or more of all limited partnership interests in such        entity;         (c)   if such entity is a limited liability company or a limited liability partnership:              (1)   the interest of any managing member or the contractual rights of any non-       member manager; or              (2)   fifty percent (50%) or more of all membership or other ownership interests        in such entity;    Sehedule I to Multifamily Loan and  Security Agreement - Definitions Schedule  (Interest Rate Type - SARM)         Form 610J.SARM                        Page IS  Fannie Mae                               _-17                    C> 2017 Fannie Mae  

 

      (d)   if such entity is a corporation (other than a Publicly-Held Corporation) with only  one class of voting stock, fifty percent (50%) or more of voting stock in such corporation;        (e)   if such entity is a corporation (other than a Publicly-Held Corporation) with more  than one class of voting stock, the amount of shares of voting stock sufficient to have the power  to elect the majority of directors of such corporation; or         (t)   if such entity is a trust (other than a land trust or a Publicly-Held Trust), the power  to Control such trust vested in the trustee of such trust or the ability to remove, appoint or  substitute the trustee of such trust (unless the trustee of such  trust after such removal,  appointment or substitution is a trustee identified in the trust agreement approved by Lender).   "Review Fee" means the non-refundable fee 0($3,000 payable to Lender.  "Sandioned Country" means a country subject to either a targeted or comprehensive country­ wide sanctions program administered and enforced by OF AC, which list is updated from time to  time.  "Sanctioned Person" means (a) a Person named on the list of "Specially Designated Nationals  and Blocked Persons" maintained by OFAC, available at http://www.treasurv.gov/resource­ center/sanctions/SDN-List/PagesidefauJt.aspx, or as otherwise published from time to time; (b)  (1) an agency of the government of a Sanctioned Country, (2) an organization controlled by a  Sanctioned Country, or (3) a Person resident in a Sanctioned Country, to the extent any Person  described in clauses (1), (2) or (3) is the subject ofa sanctions program administered by OFAC;  and, (c) a Person whose property and interests in property are blocked pursuant to an Executive  Order or regulations admInistered by OF AC consistent with the guidance issued by OF AC.  "Schedule of Interest Rate Type Provisions" means  that certain Schedule 3 (Schedule of   Interest Rate Type Provisions) to the Loan Agreement   "Security Instrument" means that certain multifamily mortgage, deed to secure debt or deed of   trust executed and delivered by Borrower as security for the Mortgage Loan and encumbering   the Mortgaged Property, including all riders or schedules attached thereto, as the same may be   amended, restated, replaced, supplemented or otherwise modified from time to time.   "ServicIng Arrangement" means any arrangement between Lender and the Loan Servicer for   loss sharing or interim advancement of funds.   "ServicIng Fee" has the meaning set forth in the Summary of Loan Terms.   "Summary of Loan Terms" means that certain Schedule 2 (Summary of Loan Terms) to the   Loan Agreement.   "Taxes" has the meaning set forth in the Security Instrument.   ''Tide Policy" means the mortgagee's loan policy of title insurance issued in cOMection with the   Mortgage Loan and insuring the lien of the Security Instrument as set forth therein, as approved   by Lender.    "Total Parking Spaces" has the meaning set forth in the Summary of Loan Terms.   "Total Residential Units" has the meaning set forth in the Summary of Loan Terms.    Scbedule 1 to Multifamily Loan and   Security Agreement - Definitions Scbedule   (Interest Rate Type - SARM)        Form 6101.SARM                       Page 16   Fannie Mae                              _-17                    <02017 Fannie Mae  

 

"Transfer" means:       (a)   a sale, assignment, transfer or other disposition (whether voluntary, involuntary,  or by operation of law), other than Residential Leases, Material Commercial Leases or non­ Material Commercial Leases permitted by this Loan Agreement;        (b)   a granting, pledging, creating or attachment of a lien, encumbrance or security  interest (whether voluntary, involuntary, or by operation oflaw);       (c)   an issuance or other creation of a direct or indirect ownership interest;       (d)   a withdrawal, retirement, removal or involuntary resignation of any owner or  manager of a legal entity; or       (e)   a merger, consolidation, dissolution or liquidation ofa legal entity.   "Transfer Fee" means a fee equal to one percent (I %) of the unpaid principal balance of the  Mortgage Loan payable to Lender.  "UCC" has the meaning set forth in the Security Instrument.  "UCC Collateral" has the meaning set forth in the Security Instrument.  "Underwriting and Servicing Requirements" means Lender's overall requirements for  Multifamily Residential Properties in connection with similar loans sold or anticipated to be  sold to Fannie Mae, pursuant to Fannie Mae's then current guidelines, including, requirements  relating to appraisals, physical needs assessments, environmental site assessments, and  servicing and asset management, as such requirements may be amended, modified, updated,  superseded, supplemented or replaced from time to time.  "Underwriting Interest Rate" means, in connection with the Conversion, the then-current  minimum underwriting interest rate (if applicable) used by Lender for underwriting new loans  with the same or substantially similar loan terms and credit characteristics as the Mortgage Loan  (taking into account the Fixed Rate Option selected by Borrower).  "Voidable Transfer" means any fraudulent conveyance, preference or other voidable or  recoverable payment of money or transfer of property.    Schedule I to Multifamily Loan and  Security Agreement - Dennitlons Schedule  (Interest Rate Type - SARM)      Form 6101.SARM                    Page 17  Fannie Mae                           _ -17                 II:) 2017 Fannie Mae  

 

Schcdulc 1 to Multifamily Loan and  Security Agreement - Definitions Schedule  (Interest Rate Type - SARM)            Form 6101.SARM                          Page 18  Fannie Mae                                 _-17                      C> 2017 Fannie Mae  

 

                                 SCHEDULE 2              TO MULTIFAMILY LOAN AND       SECURITY AGREEMENT                               Summary of Loan Terms              (Interest Rate Type - Structured ARM (1 and 3 Month LmOR»                                     BRE JEFFERSON ST. ANDREWS OWNER LLC,  Borrower                         a Delaware limited liability company                                    JONES LANG LASALLE MULTIFAMILY, LLC,  Lender                           a Delaware limited liability company   Key Principal                    BRE Imagination HoldCo LLC   Guarantor                        BRE Imagination HoldCo LLC   Multifamily Project              Jefferson at Perimeter    Borrower's General Business      clo LivCor, LLC                                   233 S Wacker Drive, Suite 4200  Address                          Chicago, Illinois 60606                                    c/o LivCor, LLC                                   233 S Wacker Drive, Suite 4200  Borrower's Notice Address        Chicago, Illinois 60606                                   Email: huber(cillivcor.com                                   Email: avraneK@revantage.com                                    4867 Ashford Dunwoody Road  Multifamily Project Address      Atlanta, Georgia 30338   Multifamily Project County       DeKaib   Key Principal's General Business clo LivCor, LLC                                   233 S Wacker Drive, Suite 4200  Address                          Chicago, Illinois 60606                                    clo LivCor, LLC                                   233 S Wacker Drive, Suite 4200  Key Principal's Notice Address   Chicago, Illinois 60606                                   Email: huber(cillivcor.com                                   Email: avraneK@revantage.com    Schedule 2 to Multifamily Loan and   Security Agreement - Summary of Loan   Terms (Interest Rate Type - SARM)  Form 6102.SARM                        Page 1   Fannie Mac                              01-16                   " 2016 Fannie Mac  

 

Guarantor's General Business    clo LivCor, LLC                                  233 S Wacker Drive, Suite 4200  Address                         Chicago, Illinois 60606                                  clo LivCor, LLC                                  233 S Wacker Drive, Suite 4200  Guarantor's Notice Address       Chicago, Illinois 60606                                   Email: huber~livcor.com                                   Email: avrane @revantage.com                                    2177 Youngman Avenue  Lender's General Business Address St. Paul, Minnesota 55116                                   Attention: Loan Servicing                                    2177 Youn!lD1an Avenue                                   St. Paul, Minnesota 55116  Lender's Notice Address          Attention: Loan Servicing                                   loanservicing@am.jll.com                                    7233 Solution Center  Lender's Payment Address         Chicago, Illinois 60677-7002    Property Square Footage          24.74 acres 11,077,838 sq. ft.   Total Parking Spaces             757   Total Residential Units          504                                          Yes  Affordable Housing Property      o                                   181   No                                    Until the first Rate Change Date, the Initial Adjustable                                   Rate, and from and after each Rate Change Date                                   following the first Rate Change Date until the next  Adjustable Rate                  Rate Change Date, a per annum interest mte that is the                                   sum of (i) the Current Index, and (ii) the Margin, which                                   sum is then rounded to the nearest three (3) decimal                                   places; provided, however, that the Adjustable Rate                                   shall never be less than the Margin.    Schedule 2 to Multifamily Loan and  Security Agreement - Summary of Loan  Terms (Interest Rate Type - SARM)   Form 6102.SARM                        Page 2   Fannie Mae                              01-16                   C> 2016 Fannie Mae  

 

Amortization Period          omonths.                                 D     Amortizing  Amortization Type            181   Full Term Interest Only                               D     Partial Interest Only                               The published Index that is effective on the Business  Current Index                Day Immediately preceding the applicable Rate Change                               Date.   Effective Date               As of October 31,2017   First Payment Date           December 1, 2017   Fixed Monthly Principal  Component                    Not Applicable   Fixed Rate Amortization Factor Not Applicable                                The ICE Benchmark Administration Limited (or any                               successor administrator) fixing of the London Inter-                              Bank Offered Rate for one (I)-month U.S. Dollar- Index                        denominated deposits as reported by Reuters  through                               electronic transmission. If the Index is no longer                               available, or is no longer posted through electronic                               transmission, Lender will choose a new index that is                               based upon comparable information.   Initial Adjustable Rate      3.012% per annum.   Initial Monthly Debt Service  Payment                       $163,150.00                                 Actuall360 (computed on the basis of a three hundred                                sixty (360) day year and the actual number of calendar                                days dunng the applicable month, calculated by  Interest Accrual Method       multiplying the unpaid principal balance of the                                Mortgage Loan by the Interest Rate, dividing the                                product by three hundred sixty (360), and multiplying                                the quotient obtained by the actual number of days                                elapsed in the applicable month).    Schedule 2 to Multifamily Loan and  Security Agreement - Summary of Loan  Terms (Interest Rate Type - SARM) Form 6102.SARM                   Page 3  Fannie Mae                           01-16                 @2016 Fannie Mae  

 

Interest Only Term              120 months.   Interest Rllte Type             Structured ARM                                                                                 \  Loan Amount                     $65,000,000.00   Loan Term                        120 months                                   The period beginning on the Effective Date and ending  Loan Year                       on the last day of October, 2018, and each successive                                  twelve (12) month period thereafter.   Margin                           1.770%                                   November  1, 2027, or any later date to which the                                   Maturity Date may be extended (if at all) in connection                                   with an election by Borrower to convert the Interest  Maturity Date                    Rate on the Mortgage Loan to a fixed rate Ilursuant to                                   the terms of the Loan Agreement, or any ear ier date on                                   which the unpaid  principal balance of the Mortgage                                   Loan becomes due and payable by acceleration or                                   otherwise.                                   (i)   for the First Payment Date, the Initial Monthly                                         Debt Service Payment, and                                   (ii)  for each Payment Date thereafter until the                                         Mortgage  Loan is fully paid, the amount  Monthly Debt Service Payment           obtained by multiplying the unpaid principal                                         balance of  the Mortga£e  Loan  by  the                                         Adjustable Rate, dividing e product by three                                         hundred sixty (360), and then mUltiplying the                                         quotient by the actual number of days elapsed                                         in the applicable month   Payment Change Date              The first (1st) day of the month followin~ each Rate                                   Change Date until the Mortgage Loan is fuI y paid.   Prepayment Lockout Period        The first (1 st) Loan Year of the term of the Mortgage                                   Loan.   Rate Change Date                 The First Payment Date and the first (lst) day of each                                   month thereafter until the Mortgage Loan is fully paid.                          I   Schedule 2 10 Multifamily Loan and  Security Agreement - Summary of Loan  Terms (Inleresl Rale Type - SARM)   Form 6102.SARM                        Page 4  Fannie Mae                               01-16                   Ie 2016 Fannie Mae  

 

                                The period beginning on the Effective Date and ending  Prepayment Premium Term         on the last calendar day of the fourth (4th) month prior                                  to the month in which the Maturity Date occurs.                                I "~                         II                                 Within [SEE SCHEDULE   6] after the Effective Date or  Completion Period               as otherwise shown on the Required Repair Schedule.   Initial Replacement Reserve                                  $0.00  Deposit   Maximum Inspection Fee          $500.00   Maximum Repair Disbursement                                  One time per calendar month  Interval   Maximum Replacement Reserve                                  One time per calendar quarter  Disbursement Interval   Minimum Repairs Disbursement                                  $5,000.00  Amount   Minimum Replacement Reserve                                  $5,000.00  Disbursement Amount   Monthly Replacement Reserve                                  $15,330.00  Deposit   Repair Threshold                $10,000.00   Repairs Escrow Account          $0.00, payable one time  Administrative Fee                                   $248,275.00  Repairs Escrow Deposit          ($127,325.00 - Repairs; $120,950.00 - Green Repairs)   Replacement Reserve Account     $0.00, payable annually  Administration Fee   Replacement Reserve Account     Annually  Interest Disbursement Frequency    Schedule 2 to Multifamily Loan and  Security Agreement - Summary of Loan  Terms (Interest Rate Type - SARM)   Form 6102.SARM                        PageS  Fannie Mae                               01-16                   «:> 2016 Fannie Mae  

 

IReplacement  Threshold      I$\0,000.00       Conversion Review Fee       A non-refundable fee in the amount of $5,000.00.    Guaranty Fee                The guaranty fee offered by Fannie Mae for a new Fannie                                Mae mortgage loan with the same or substantially similar                                loan terms and credit characteristics as the Mortgage                                Loan (taking into account the Fixed Rate Option selected                                by Borrower) at the time of the Conversion Effective                                Date.     Minimum Conversion Debt      1.25    Service Coverage Ratio     Servicing Fee               The servicing fee offered by Fannie Mae for a new                                Fannie Mae mortgage loan with the same or substantially                                similar loan terms and credit characteristics as the                                Mortgage Loan (taking into account the Fixed Rate                                 Option selected by Borrower) at the time of the                                 Conversion Effective Date.      Schedule 2 to Multifamily Loan and    Security Agreement - Summary of Loan    Terms (Interest Rate Type - SARM) Form 6102.SARM                   Page 6    Fannie Mae                           01-16                 I!) 2016 Fannie Mae  

 

                                      Borrow        s    Schedule 2 to Multifamily Loan and  Security Agreement - Summary or Loan  Terms (Interest Rate Type - SARM)      Form 6102.SARM                          Page 7   Fannie Mae                                 01-16                     C12016 Fannie Mae  

 

                               SCHEDULE 3              TO MULTIFAMILY LOAN AND SECURITY AGREEMENT                      Schedule of Interest Rate Type Provisions        (Structured ARM (1 and 3 Month LmOR» and Fixed Rate Conversion Option    1.   Defined Terms.        Capitalized tenns not otherwise defined in this Schedule have the meanings given to such   tenns in the Definitions Schedule to the Loan Agreement.   2.   Interest Accrual.        Except as otherwise provided in the Loan Agreement, interest shall accrue at the   Adjustable Rate until the Mortgage Loan is fully paid.   3.   Adjustable Rate; Adjustments.        The Initial Adjustable Rate shall be effective until the first Rate Change Date.   Thereafter, the Adjustable Rate shall change on each Rate Change Date based on fluctuations in   the Current Index.   4.   Fixed Monthly Principal Component.        Each amortizing Monthly Debt Service Payment shall  include a principal payment equal   to the Fixed Monthly Principal Component, which shall be detennined using the Fixed Rate   Amortization Factor.   5.   Notification of Interest Rate Change and Monthly Debt Service Payment.        Before each Payment Change Date, Lender shall notify Borrower of any change in the   Adjustable Rate and the amount of the next Monthly Debt Service Payment.   6.    Correction to Monthly Debt Service Payments.         If Lender detennines at any time that it has miscalculated the amount of a Monthly Debt   Service Payment (whether because of a miscalculation of the Adjustable Rate or otherwise), then   Lender shall give notice to Borrower of the corrected amount of the Monthly Debt Service   Payment (and the corrected Adjustable Rate, if applicable) and a. if the corrected amount of the   Monthly Debt Service Payment represents an increase, then Borrower shall, within thirty (30)   calendar days thereafter, pay to Lender any sums that Borrower would have otherwise been   obligated to pay to Lender had the amount of the Monthly Debt Service Payment not been   miscalculated, or b. if the corrected amount of the Monthly Debt Service Payment represents a   decrease and Borrower is not otherwise in default  under any of the Loan Documents, then   Borrower shall thereafter be paid the sums that Borrower would not have otherwise been   obligated to pay to Lender had the amount of the Monthly Debt Service Payment not been   miscalculated.    Schedule 3 to Multifamily Loan and  Security Agreement - Interest Rate and  Conversion Provisions (SARM)      Form 6103.SARM                    Page I   Fannie Mae                           04-17                 I!:l 2017 Fannie Mae  

 

 7.    Conversion to Fixed Rate.         (a)   Conversion Option.               (I)   Subject to the following terms and conditions, Borrower may exercise the         Conversion Option pursuant to which the interest rate payable on the Mortgage Loan may         be converted, one (I) time only, on any Payment Date during the Conversion Period from         the Adjustable Rate to the Fixed Rate, after which the interest rate on the Mortgage Loan         shall remain at the Fixed Rate until the New Maturity Date.               (2)   For Mortgage Loans that are full-term interest-only, the Amortization Period         from and after the Conversion Effective Date shall be three hundred sixty (360) months.         For all other Mortgage Loans, including Mortgage Loans that are partial interest-only or         amortizing, the Amortization Period from and after the Conversion Effective Date shall be:                     (A)   three hundred sixty (360) months, if (i) Borrower selects a Fixed               Rate Option having a term greater than or equal to the original term of the               Mortgage Loan from the Effective Date through the Maturity Date, and (ii) the               most recent inspection of the Mortgaged Property by Lender resulted in a rating               of either "I" or "2"; or                      (B)   in all other cases, the number of months equal to (i) three hundred               sixty (360) months, minus (ii) the number of Monthly Debt Service Payments that               have elapsed since the Effective Date.               (3)   The Monthly Debt Service Payment following a Conversion shall be in an         amount required to pay the unpaid principal balance of the Mortgage Loan immediately         prior to the Initial Fixed Rate Payment Date in equal monthly installments, including         accrued interest at the Fixed Rate, over the Amortization Period utilizing the 30/360         Interest Accrual Method even if Actual/360 is the Interest Accrual Method.               (4)   The Conversion Option shall lapse (A) at 5:00 p.m. (Eastern Time) on the         ninetieth (90th) day prior to the expiration of the Conversion Period if Borrower has not         previously delivered to Lender an NCF Determination Request in accordance with the         terms of this Schedule or (B) on the Conversion Effective Date, if the Conversion Option         is timely exercised but the Fixed Rate does not become effective on such Conversion         Effective Date.               (5)   It is anticipated that the Conversion will be effected by the issuance by         Lender of a fixed-rate MBS or by the cash purchase of the Mortgage Loan by Lender into         its portfolio (subject to the provisions of Section 7(b)(2) of this Schedule). Borrower         acknowledges, however, that the Conversion is contingent on the capital markets         generally, and that from time to time, disruptions in the capital markets may make         Conversion infeasible. In the event Lender is not able to obtain any quotes for the         Mortgage Loan at the Fixed Rate (and does not make a cash bid for the Mortgage Loan),         or if the quotes exceed the Maximum Fixed Rate, the interest rate on the Mortgage Loan         shall remain at the Adjustable Rate.    Schedule 3 to Multifamily Loan and  Security Agreement - Interest Rate and  Conversion Provisions (SARM)         Form 6103,sARM                        Page 2  Fannie Mae                               04-17                    «:> 2017 Fannie Mae  

 

      (b)   Procedures for Conversion.              (1)  NCF Determination Request.                   (A)   Subject to the tenns of the Loan Agreement, if Borrower desires to              exercise the Conversion Option, Borrower shall submit an NCF Detennination              Request to Lender, which shall include Borrower's selection of a Fixed Rate              Option.                   (B)   The NCF Detennination Request shall be accompanied by the              Conversion Review Fee in the fonn of a check payable to Lender or by wire              transfer to an account designated by Lender.                   (C)   In no event shall the NCF Detennination Request be made prior to              the commencement of the Conversion Period or less than ninety (90) days prior to              the expiration of the Conversion Period. Borrower may not submit an NCF              Detennination Request if an Event of Default has occurred and is continuing at              the time of the request or if an Event of Default has occurred at any time within              the twelve (12) month period immediately preceding the date of Borrower's              request. In addition, Borrower may not submit an NCF Detennination Request              more than twice in any Loan Year. Borrower shall submit to Lender, within              five (5) days after receipt of a request therefor, all infonnation relating to the              operation of the Mortgaged Property required by Lender to detennine the Net              Cash Flow and Borrower's compliance with Section 7 of this Schedule. If              Borrower fails to provide such infonnation within such period, Borrower's NCF              Detennination Request shall be deemed canceled (however, such canceled NCF              Detennination Request shall count as a request for the Loan Year in which the              request was made).              (2)  Conversion Eligibility Determination.                   (A)   Within fifteen (15) days after receipt of an NCF Detennination              Request (or, if Lender requests additional infonnation from Borrower pursuant to              Section 7(b)(2)(B) of this Schedule, within fifteen (15) days after Lender's receipt              of such additional infonnation), Lender shall detennine the Net Cash Flow of the              Mortgaged Property and the Maximum Fixed Rate to which the Mortgage Loan              may be converted and shall provide Borrower with the NCF Detennination              Notice.                   (B)   Lender shall detennine the Net Cash Flow for the trailing twelve              (12) month period on the basis of the most recently received quarterly financial              statements (as such statements may be adjusted by Lender as necessary to              accurately reflect items of income, operating expenses, ground lease payments, if              applicable, and replacement reserves to reflect suitable underwriting) prepared by              Borrower for the Mortgaged Property. In connection with any request by Lender              for additional infonnation, Borrower shall have five (5) days after Borrower's              receipt of such request to provide Lender with such additional infonnation.                    (C)  Borrower may not exercise the Conversion Option unless Lender              detennines that, based upon the Net Cash Flow set forth in the NCF              Detennination Notice and the Fixed Rate quoted in connection with a Rate Lock   Schedule 3 to Multifamily Loan and  Security Agreement - Interest Rate and  Conversion Provisions (SARM)      Form 6103.SARM                    Page 3   Fannie Mac                           04-17                 CI 2017 Fannie Mac  

 

             Request, the Debt Service Coverage Ratio for the Mortgaged Property is equal to               or greater than the Minimum Conversion Debt Service Coverage Ratio.               (3)   Exercise of Conversion Option; Rate Lock Request.                     (A)   If, after receipt of the NCF Determination Notice, Borrower               desires to exercise the Conversion Option, Borrower shall, within fifteen (15)               days of Borrower's receipt of the NCF Determination Notice:                           (i)   provide Lender with a title report for the Mortgaged                     Property prepared by, or by an agent for, the issuer of the Title Policy,                     showing marketable fee simple or leasehold title to the Mortgaged                     Property (as applicable) to be vested in Borrower, free and clear of all                     Liens and  other matters affecting title other than the Permitted                     Encumbrances;                            (ii)  pay to Lender the Good Faith Deposit; and                            (iii) make a Rate Lock Request.                      (B)   If the Conversion closes, Lender shall refund the Good Faith               Deposit to Borrower within thirty (30) days after the Conversion Closing Date. If               Borrower pays the Good  Faith Deposit but does not timely exercise the               Conversion Option and the Fixed Rate is not rate locked, Lender shall refund the               Good Faith Deposit to Borrower within forty-five (45) days after receipt of a               written request from Borrower (and the interest rate shall remain at the Adjustable               Rate). If Borrower timely exercises the Conversion Option, but the Conversion is               not consummated for any reason other than a default by Lender in performing its               obligations under the Loan Agreement, Borrower shall forfeit the Good Faith               Deposit and (i) if the MBS Investor is not Fannie Mae, shall be fully liable for,               and agrees to pay on demand, any and all loss, costs and/or damages incurred by               Lender in connection with Borrower's failure to consummate the Conversion as               provided herein, including any loss, costs and/or damages incurred by Lender in               excess of the Good Faith Deposit, and (ii) if the MBS Investor is Fannie Mae or if               the converted Mortga~e Loan is held by Fannie Mae and does not back an MBS,               the Good Faith DepOSIt shall serve as liquidated damages resulting from failure to               consummate the Conversion. Borrower expressly acknowledges that by electing               to convert the interest rate on the Mortgage Loan to the Fixed Rate, and agreeing               to the Fixed Rate as provided herein, Borrower is causing Lender to take a               position in the financial markets in reliance thereon, and the failure of Borrower               to convert the interest rate on the Mortgage Loan to the Fixed Rate as provided               herein may cause Lender to incur economic damages.                     (C)   If Borrower desires to exercise the Conversion Option and has               complied with all other requirements of Section 7(d) of this Schedule, within               fifteen (15) days of Borrower's receipt of the NCF Determination Notice,               Borrower shall contact Lender to initiate a Rate Lock Request. If the Fixed Rate               quoted to Borrower is greater than the Maximum Fixed Rate, Borrower shall not               be permitted to accept the quoted Fixed Rate (or exercise its Conversion Option).               On or before 5:00 p.m. (Eastern Time) of the day Borrower accepts the quoted               Fixed Rate, Borrower and Lender shall confirm to each other (by letter addressed   Schedule 3 to Multifamily Loan and   Security Agreement - Interest Rate and   Conversion Provisions (SARM)        Form 6103.SARM                        Page 4   Fannie Mae                              04-17                    <02017 Fannie Mae  

 

             from Lender to Borrower, acknowledged and accepted in writing by Borrower               and transmitted, in each case, by facsimile or other electronic transmission               acceptable to Lender), (i) the Fixed Rate, (ii) the New Maturity Date (if               apphcable), (iii) the Conversion Effective Date, (iv) the new Monthly Debt               Service Payment and (v) the Initial Fixed Rate Payment Date.         (c)   Amendment to Multifamily Loan and Security Agreement.                The Conversion shall be evidenced by the Conversion Amendment.          (d)   Conditions Precedent to Closing of Conversion.                Borrower's right to consummate the Conversion and Lender's obligation to         execute and deliver the Conversion Amendment, shall be subject to satisfaction of the         conditions precedent below.               (a)   All representations and warranties of Borrower set forth in the Loan         Documents shall be true and correct in all material respects on and as of the Conversion         Closing Date as though made on and as of the Conversion Closing Date.                (b)   Borrower shall have performed or complied with all of its obligations         under the Loan Agreement to be performed or complied with on or before the Conversion         Closing Date.               (c)   On the Conversion Closing Date, no Event of Default shall have occurred         and be continuing (or any event which, with the giving of notice or the passage of time,         or both, would constitute an Event of Default has occurred and is continuing).                (d)   On the Conversion Closing Date, Lender shall have received all of the         following, each of which, where applicable, shall be executed by individuals authorized         to do so, shall be dated as of the Closing Date, and shall be in form and substance         acceptable to Lender:                     (A)   the Conversion Amendment;                      (B)   an endorsement to the Title Policy or a new Title Policy as of the               Conversion Closing Date showing that the Security Instrument constitutes a valid               mortgage lien on the Mortgaged Property, with the same lien priority insured by               the Title Policy, subject only to the Permitted Encumbrances;                      (C)   either (i) the Survey, redated to a date within fifteen (15) days prior               to the Conversion Closing Date showing that there are no Liens or other matters               that have arisen since the date of the Survey other than matters approved in               writing by Lender, or (ii) affirmative coverage in the title insurance endorsement               referred to in Section 7(d)(4)(B) that there are no exceptions based upon the               results of a visual inspection of the Mortgaged Property, or the absence of any               exception based upon any facts or conditions which have arisen since the date of               the Survey and which would be disclosed by a current survey of the Mortgaged               Property;    Schedule 3 to Multifamily Loan and  Security Agreement - Interest Rate and  Conversion Provisions (SARM)         Form 6103.SARM                        PageS   Fannie Mae                              04-17                    «:l 2017 Fannie Mae  

 

                   (D)   if necessary, as detennined by Lender, an amendment to the               Security Instrument to be recorded in the land records and insured as a               supplement to the Security Instrument to reflect the New Maturity Date;                      (E)   an opinion of counsel satisfactory to Lender as to such matters as               Lender may reasonably request; and                     (F)   such other documents as Lender may reasonably request related to               the Loan  Agreement, the  Conversion Amendment   or the  transactions               contemplated hereby or thereby.               (e)   The Mortgaged Property shall not have been damaged, destroyed or         subject to any condemnation or other taking, in whole or any material part, and Lender         shall have received a certificate of Borrower, dated as of the Conversion Closing Date, to         such effect.   8.    Property Condition Assessment.         Notwithstanding the provisions of Section 13.02(a)(3)(A), if the Conversion Option is   exercised for any Mortgaged Property other than an "affordable housing property" (as indicated   on the Summary of Loan Tenns), and extends the Loan Tenn, then a new property condition   assessment shall be required in the earlier of (a) the Loan Year that would have been the final   Loan Year of the Mortgage Loan had the Conversion Option not been exercised, or (b) the   tenth (10th) Loan Year.    Schedule J to Multifamily Loan and  Security Agreement - Interest Rate and  Conversion Provisions (SARM)         Form 610J.SARM                        Page 6   Fannie Mae                               04-17                   IC 2017 Fannie Mae  

 

Schedule 3 to MultIfamIly Loan and  Security Agreement - Interest Rate and  Conversion Provisions (SARM) .         Form 6103.SARM                          Page 7  FaDnleMae                                   04-17                     1!:l2017 Fannie Mae  

 

                                 SCHEDULE 4              TO MULTIFAMILY LOAN AND SECURITY AGREEMENT                            Prepayment Premium Schedule                      (1 % Prepayment Premium - ARM, SARM)   1.    Defined Terms.         All capitalized tenns used but not defined in this Prepayment Premium Schedule shall  have the meanings assigned to them in the Loan Agreement.   2.    Prepayment Premium.         (a)   Ally Prepayment Premium payable under Section 2.03 (LockoutlPrepayment) of  the Loan Agreement shall be equal to the following percentage of the amount of principal being  prepaid at the time of such prepayment, acceleration or application:                        Prepayment Lockout Period  5.00%                       Second Loan Year, and each  1.00%                       Loan Year thereafter         (b)   Notwithstanding the provisions of Section 2.03 (LockoutlPrepayment) of the  Loan Agreement or anything to the contrary in this Prepayment Premium Schedule, no  Prepayment Premium shall be payable with respect to any prepayment made on or after the last  calendar day of the fourth (4th) month prior to the month in which the Maturity Date occurs.    Schedule 4 to Multifamily Loan and  Security Agreement (Prepayment Premium  Schedule - 1%  Prepayment Premium­ ARM,SARM)                             Form 6104.11                        Page 1  Fannie Mae                               01-1\                   @ 2011 Fannie Mae  

 

Schedule 4 to Multifamily Loan and  Security Agrcement (prepaymcnt Premium  Schcdulc - 1%  Prepayment Premium­ ARM,SARM)                                Form 6104.11                          Page 2  Fannie Mae                                  01-11                    Cl2011 Fannie Mae  

 

                                  SCHEDULE 5 TO                MULTWANULYLOANANDSECIDUTYAGREEMENT                              Required Replacement Schedule    Multifamily Loan and Security Agreement  (Non-Recourse)                           Form 6001.NR                             Page 1  Schedule 5                                  01-16                      It:> 2016 Fannie Mac  

 

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Multifamily Loan and Security Agreement  (Non-Recourse)                               Form 6001.NR                                Page 2  Schcdule 5                                       01-16                        (0 2016 Fonnle Mae  

 

                                           SCHEDULE 6 TO                     MULTIFAMILY LOAN AND SECURITY AGREEMENT                                          Required Repair Schedule                   D"crlpllOa Df R.... 1r            Esllm.te         H.~%             H.ldb.dt    C.mp..... D                                                                                                      TIme                                                                                                    Fnme                                                                                                    (MDI.)        CRITICAL REPAIRS (6 mODtI..     or less) " D~FERRED MAINTENANCE (11        mORtbs .r I... )         W_a Track (CrldC1ll): l'erimeu:r w.lki.R InI<k        oround 1O,.1ot is In poor 10 fair condld ... Linear        "",.king w..  ~ In 'ppr1>llimo,.ly 13        locations. The northeast comet of the traclt has un        ..... of alliRDtor CIlICkinR ond is i......  of        rcpl.cell1o:nL These ..... n:pn:sen' lrip hazards ond        .....t'ohe  '.'                                56.000          125%               57,500   6 Montbs        POI' MI.'lemen' (CritIaL): Then: is 0 heavy        Clennan Roach inf.... dan  throtJgbou, all uallS.        lmptemertt the nve step treatment process was        recommended by Termlnes Inclndlng il1U11<dlale        pby.icaI removal of as .....y  roocha as possible,        IreIIImcnI of voids wbc:n= rOllChes live., application of        bail insecticides. application of residual dusl        insecticides, and Introduction ofon Insect (jrowth        Regulotor (IRO) into the envinmmen' for long.1mn        control of re-infcslDtiott.                   545,360          125%              S56700    6 Montbs        un... eaplnWErosion  (Crill"'): Areas of erosion        and ...... hnIcbcape w..., noIed throuldtou, die        property n..,. sidewalts, parking ...... ,idew.U,.,        .nd .parUnenl breezowoys Ihroughoul the property.        An .pproxlmale 12" drop-olTbas _ ...."  ....1 die         sidewoll< ..... die enll'DllCe ofBuiIdJuR I L Build-up        of soil deposits were noted III mullipJe sidewalk        10CDIi0ns throughoul die property. R.... ir  of the        eroded IDndicapc ...... is required.          510.000           125%             512,500   6 Montbs         ~I"'tu .. I.d )Ikrnblal Growtb (Crll"'I): Waler        domage w..  ~ within uall  1221 L Slanding        WIlIer ..... oboc:niedln die kitchen ..... of II .. unil        due 10. leak fram the kit.hen ,ink. Repuir ofthe       I plumbi...  leaJc and  "",terials i. n:ouired. S5.OOO           125%              56.250   6 Montbs        Laad.eapIBc (Det MnlBL): Multiple In:C5        nppeorecl to be in contJu:t wid. buiWing perimo .....        Wbn1.ppean:d to be • dead .... near BuildinR 8 and        Building 12 were .bserv....  Additionnl.vergrowth        ofbushes WDS observed throuMhoUl die property and        blocking the sideWIIlk neor the Tot lot 0Pd tennis        courtJ. Trimming of the O\lersrowth and remonl of        die dead ..... is required.                    58,000           125%             510.000   12 M.nth.        Curblna (Der. MalaL): A .... root .yucm bas        uplifted a 1o..root stdion of curbillM on the wesc :side        ofBuIldhu! I tltnt ...... t. be .....ired.       S800           125%              51,000   12 Montbs        RetolalD, Walls (Det MaIDt): The milrond de        rdDining waU near the TOl Lot sllO,,"'I sign!li of        displllcemeat lennlng .0wanJ the adjacent sidewaJk,        which ...... t. be ~red.                       SI,500           125%              51.875   12 Months    Multifamily Loan and Security Agreement  (Non-Recourse)                                      Form 6001.NR                                         Page 1  Scbedule6                                                01-16                              © 2016 Fannie Mae  

 

    Unit \\1r111g (Dor. Mala.): Only """"1:i1cl1en ....      batluoom outlets "'" cum:nlly proleo:.ed with ground      fnul. circuit inlenup,er (GFCt) outlets. SlIr\'ey ofoll      Wlits .... i.. tall  GFCI DU'lotsln Wei ...... of      kild1ens and batluooms.               .        S2S.2oo           125%             531,500    12 Months      Green Rep.ln      LIlIb.laR (EWE'" 6): UpRWIo in-unit IiJlhtinR;      L1gh.ing - Interior -lligh Efficacy (LED~ All Res.      Units                                          S88.200           100%             588.200    12 Months      LIlIbIla~ (EWE'" 7): UJIM'Bllo ostorior liJlhtinll'      Lighting - Ex"';nr -lligh Efficacy (LED). Common      Areas                                          532.750           100%             532.750    12 Months      ITEMS OF NOTE (11 mDnlbs or las) "     SHORT TERM REPLACEMENT OF      CAPITAL ITEMS (>11 months)       CurblnllPola.InR: The pointed curbing IUOIIDd      BuildinHl J. 4. S. 6 &: 7. which has been pointed rod      lO denote fire Janel probibitiaR pDrking. ill; in      deteriorated canditl .. nnd n.....  n:pajnlin..  N/A             N/A               N/A       12 Months                                       Tota)        5222.810                           5248.275                                                                  TotolAmount ofJLL                                                                            Holdback    S248.275        r    Multifamily Loan and Security Agreement  (Non-Recourse)                                      Form 6001.NR                                         Page 2  Schedule 6                                               01-16                              It' 2016 Fannie Mae  

 

Multifamily Loan and Security Agreement  (Non-Recourse)             -           Form 6001.NR                            Page 3  Schedule 6                                 01-16                     <02016 Fannie Mae  

 

                            SCHEDULE 7 TO              MULTIFAMILY LOAN AND SECURITY AGREEMENT                Exceptions to Representations and Warranties Schedule                                    NONE    Multifamily Loan and Security Agreement  (Non-Recourse)                    Form 6001.NR                     Page 1  Schedule 7                           01-16                 «:l2016Fannle Mae  

 

Multifamily Loan nnd Security Agreement  (Non-Recourse)                 .             Form 6001.NR                                Pagel  Schedule 7                                       01-16                         Cl2016Fannie Mae  

 

                                   EXHIBIT A      MODIFICATIONS TO MULTIFAMILY LOAN AND SECURITY AGREEMENT                           (Green Financing Mortgage Loans)    The foregoing Loan Agreement is hereby modified as follows:          1.    Capitalized terms used and not specifically defined herein have the meanings   given to such terms in the Loan Agreement.          2.    The following Article is hereby added to the Loan Agreement as Article 16 (Green   Financing Mortgage Loan):               ARTICLE 16 -    GREEN FINANCING MORTGAGE LOAN         Section 16.01 Covenants.               (a)   Borrower shall (I) track and report the energy and water consumption for         all energy and water sources, metered and unmetered, that provide energy and water         service to the Mortgaged Property using the United States Environmental  Protection         Agency's ENERGY   STAR®   Portfolio Manager; and (2) perform any other ongoing         monitoring necessary for tracking and reporting the energy and water performance of the         Mortgaged Property in Portfolio Manager.               (b)   Borrower shall include with the delivery of items required under         Section 8.02(0)(2), the Fannie Mae Energy Performance Metrics report, as generated by         ENERGY STAR® Portfolio Manager (or any successor or replacement application), for         the Mortgaged Property for such calendar year, which report must include the ENERGY         STAR score, the Source Energy Use Intensity (EUI), the month and year ending period         for such ENERGY STAR score and such Source Energy Use Intensity, and the ENERGY         STAR Portfolio Manager Property Identification Number.    Modifications to Multlramily Loan and Seeurlty  Agreement (Green Financing Mortgage Loans) Form 6241                       Page 1  Fannie Mac                                  01-16                @ 2016 Fannie Mac  

 

Modlficat!ons to Multifamily Loan and Security  Agreement (Green Financing Mortgage Loans)        Form 6241                               Page 2   Fannie Mae                                          01-16                     C) 2016 Fannie Mae  

 

                                  EXHIBITB     MODIFICATIONS TO MULTIFAMILY LOAN AND SECURITY AGREEMENT                                  (Springing Cap)   The foregoing Loan Agreement is hereby modified as follows:        1.    Capitalized terms used and not specifically defined herein have the meanings  given to such terms in the Loan Agreement.        2.    Article 3.02(a) (Limits on Personal Liability) of the Loan Agreement is hereby  amended by adding the following subsection to the end thereof:        Section 3.02(a)(8) Personal Liability for Failure to Purchase Interest Rate Cap.              (8)   failure of Borrower to purchase an Interest Rate Cap as required in Section        2.01(a) of the Interest Rate Cap Reserve and Security Agreement dated as of the        Effective Date.    ModlOcations to Multlramlly Loan and  Security Agreement (Springing Cap)     Form 6245                          Page 1  Fannie Mac                               01-16                   C 2016 Fannie Mac  

 

Modifications to Multifamily Loan and  Security Agreement (Springing Cap)         Form 6245                            Page 2   FonnleMae                                   01-16                    © 2016 Fannie Mae  

 

                                  EXHIBITC       MODIFICATIONS TO MULTIFAMILY LOAN AND SECURITY AGREEMENT                            (Waiver ofImposition Deposits)         The foregoing Loan Agreement is hereby modified as follows:         1.    Capitalized terms used and not specifically defined herein have the meanings  given to such terms in the Loan Agreement.         2.    The Definitions Schedule is hereby amended by adding the following new  definitions in the appropriate alphabetical order:         "Insurance Impositions" means the premiums for maintaining all Required        Insurance Coverage.         "Required  Insurance Coverage" means  the insurance coverage required        pursuant to Article 9 (Insurance) of the Loan Agreement and under any other        Loan Document.         3.    Section 12.02 (Imposition Deposits, Taxes, and Other Charges - Covenants) of  the Loan Agreement is hereby amended by adding the following provisions to the end thereof:                (b)  Conditional Waiver of Collection ofImposition Deposits.                     (1)   Notwithstanding anything contained in this Section 12.02              (Imposition Deposits, Taxes, and Other Charges - Covenants) to the              contrary, Lender hereby agrees to waive the collection of Imposition              Deposits for Insurance Impositions, provided, that:                           (A)   Borrower  shall pay such Insurance Impositions                    directly to the carrier or agent ten (10) days prior to expiration or                    as necessary to prevent the Required Insurance Coverage from                    lapsing due to non-payment of premiums;                            (B)   Borrower shall provide Lender with proof of                     payment acceptable to Lender of all Insurance Impositions within                     five (5) days after the date such Insurance Impositions are paid;                     and                            (C)   Borrower shall cause its insurance agent to provide                     Lender with such certifications regarding the Required Insurance                     Coverage as Lender may request from time to time evidencing that                     the Insurance Impositions have been paid in a timely manner and    Modincatlons to Multifamily Loan and  Security Agrecment (Waiver of Imposition   Deposits)                             Form 6228                          Page 1   Fannie Mae                              04-12                   10 2012 Fannie Mae  

 

                  that all of the Required Insurance Coverage is in full force and                    effect.                     (2)   Lender reserves the right to require Borrower to deposit the              Imposition Deposits with Lender on each Payment Date for Insurance              Impositions in accordance with this Section 12.02 (Imposition Deposits,              Taxes, and Other Charges - Covenants) upon:                           (A)   Borrower's failure to pay Insurance Impositions or                    to provide Lender with proof of payment of Insurance Impositions                    as required in this Section 12.02(b) (Conditional Waiver of                    Collection ofImposition Deposits);                           (B)   Borrower's failure to maintain insurance coverage                    in accordance with the requirements of Article 9 (Insurance);                           (C)   the occurrence of any Transfer which is not                    permitted by the Loan Documents, or any Transfer which requires                    Lender's consent; or                           (0)   the occurrence of a default under any of the other                    terms, conditions and covenants set forth in this Loan Agreement                    or any of the other Loan Documents.                     (3)   Except as specifically provided in this Section 12.02(b)              (Conditional Waiver of Collection of Imposition Deposits), the provisions              of Article 9 (Insurance) shall remain in full force and effect.     ModlOcatlons to Multifamily Loan and  Security Agreement (Waiver of Imposition   Deposits)                             Form 6228                          Page 2   Fannie Mac                              04-12                   IC 2012 Fannie Mac  

 

                                                  Borrower    Modifications to Multifamily Loan and  Security Agreement (Waiver of Imposition  DeposIts)                                Form 6228                             Page 3  Fannie Mae                                 04-12                     o 2012 Fannie Mae

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