Document:

exv10w33

 

Exhibit 10.33

	 	 	 
	
    
    WHEN RECORDED MAIL TO
    

    	 	
    STAFFORD COUNTY CIRCUIT COURT
    
	
    Joanne Feil, Esq.

    Rogers & Wells

    200 Park Avenue

    New York, New York 10166-0153

    Attn: Gregory D. Shanklin, Esq.

    (3198/318)
    	 	
    SPACE ABOVE THIS LINE FOR RECORDER’S USE
    

DEED OF TRUST,

ASSIGNMENT OF RENTS AND SECURITY
AGREEMENT

    
THIS DEED OF TRUST (herein
“Instrument”) is made this 9th day of January, 1998,
among the Trustor/Grantor, AQUIA COMMERCE CENTER, L.C., a
Virginia limited liability company, whose address is 2721
Jefferson Davis Highway, Stafford, Virginia 22554 (herein
“Borrower”). Thomas R. Petty, Fairfax County, Virginia
(herein “Trustee”), and the Beneficiary, GMAC
COMMERCIAL MORTGAGE CORPORATION, a corporation organized and
existing under the laws of California, whose address is 650
Dresher Road, Horsham, PA 19044, together with its successors,
assigns and transferees, (herein “Lender”).

    
BORROWER, in consideration of the indebtedness
herein recited and the trust herein created, irrevocably grants,
conveys and assigns to Trustee in trust, with power of sale, the
following described property located in Stafford, State of
Virginia, and more particularly described on
Exhibit “A” attached hereto and incorporated
herein by reference for all purposes.

    
TOGETHER with all buildings, improvements and
tenements now or hereafter erected on the property, and all
heretofore or hereafter vacated alleys and streets abutting the
property, and all easements, rights, appurtenances, rents
(subject however to the assignment of rents to Lender herein),
royalties, mineral, oil and gas rights and profits, water, water
rights, and water stock appurtenant to the property, and all
fixtures, machinery, equipment, engines, boilers, incinerators,
building materials, appliances and goods of every nature
whatsoever now or hereafter located in, or on, or used, or
intended to be used in connection with the property, including,
but not limited to, those for the purposes of supplying or
distributing heating, cooling, electricity, gas, water, air and
light; and all elevators, and related machinery and equipment,
fire prevention and extinguishing apparatus, security and access
control apparatus, plumbing, bath tubs, water heaters, water
closets, sinks, ranges, stoves, refrigerators, dishwashers,
disposals, washers, dryers, awnings, storm windows, storm doors,
screens, blinds, shades, curtains and curtain rods, mirrors,
cabinets, panelling, rugs, attached floor coverings, furniture,
pictures, antennas, trees and plants, tax refunds, trade names,
licenses, permits, Borrower’s rights to insurance proceeds,
unearned insurance premiums and chooses in action; all of which,
including replacements and additions thereto, shall be deemed to
be and remain a part of the real property covered by this
Instrument; and all of the foregoing, together with said
property (or the leasehold estate in the event this Instrument
is on a leasehold) are herein referred to as the
“Property”;

    
TOGETHER with all right, title and interest in,
to and under any and all leases now or hereinafter in existence
(as amended or supplemented from time to time) and covering
space in or applicable to the Property (hereinafter referred to
collectively as the “Leases” and singularly as a
“Lease”), together with all rents, earnings, income,
profits, benefits and advantages arising from the Property and
from said Leases and all other sums due or to become due under
and pursuant thereto, and together with any and all guarantees
of or under any of said Leases, and together with all rights,
powers, privileges, options and other benefits of Borrower as
lessor under the Leases, including, without limitation, the
immediate and continuing right to receive and collect all rents,
income, revenues, issues, profits, condemnation awards,
insurance proceeds, moneys and security payable or receivable
under the Leases or pursuant to any of the provisions thereof,
whether as rent or otherwise, the right to accept or reject any
offer made by any tenant pursuant to its Lease to purchase the
Property and any other property subject to the Lease as therein
provided and to perform all other necessary or appropriate acts
with respect to such Leases as agent and attorney-in-fact for
Borrower, and the right to make all waivers and agreements, to
give and receive all notices, consents and releases, to take
such action upon the happening of a default under any Lease,
including the commencement, conduct and consummation of
proceedings at law or in equity as shall be permitted under any
provision of any Lease or by any law, and to do any and all
other things whatsoever which the Borrower is or may become
entitled to do under any such Lease together with all accounts
receivable, contract rights, franchises, interests, estates or
other claims, both at law and in equity, relating to the
Property, to the extent not included in rent earnings and income
under any of the Leases;

    
TOGETHER with all right, title and interest in,
to and under any and all reserve, deposit or escrow accounts
(the “Accounts”) made pursuant to any loan document
made between Borrower and Lender with respect to the Property,
together with all income, profits, benefits and advantages
arising therefrom, and together with all rights, powers,
privileges, options and other benefits of Borrower under the
Accounts, and together with the right to do any and all other
things whatsoever which the Borrower is or may become entitled
to do under the Accounts;

    
TOGETHER with all agreements, contracts,
certificates, guaranties, warranties, instruments, franchises,
permits, licenses, plans, specifications and other documents,
now or hereafter entered into, and all rights therein and
thereto, pertaining to the use, occupancy, construction,
management or operation of the Property and any part thereof and
any improvements or respecting any business or activity
conducted on the Property and any part thereof and all right,
title and interest of Borrower therein, including the right to
receive and collect any sums payable to Borrower thereunder and
all deposits or other security or advance payments made by
Borrower with respect to any of the services related to the
Property or the operation thereof;

    
TOGETHER with all tradenames, trademarks,
servicemarks, logos, copyrights, goodwill, books and records and
all other general intangibles relating to or used in connection
with the operation of the Property; and

    
TOGETHER with any and all proceeds resulting or
arising from the foregoing (collectively, the
“Collateral”).

    
TO SECURE TO LENDER (a) the repayment of the
indebtedness evidenced by Borrower’s note dated of even
date herewith (herein “Note”) in the principal sum of
One Million Five Hundred Thousand and 00/100 Dollars
($1,500,000.00), with interest thereon, with the balance of the
indebtedness, if not sooner paid, due and payable on
February 1, 2013 (the “Maturity Date”), and all
renewals, extensions and modifications thereof; (b) the
repayment of any future advances, with interest thereof, made by
Lender to Borrower pursuant to paragraph 39 hereof (herein
“Future Advances”); (c) the performance of the
covenants and agreements of Borrower contained in an
Environmental Indemnity Agreement (herein so-called) between
Lender, Borrower and Principal (as defined in the Environmental
Indemnity Agreement) dated of even date herewith; (d) the
payment of all other sums, with interest thereon, advanced in
accordance herewith to protect the security of this Instrument;
and (e) the performance of the covenants and agreements of
Borrower herein contained, or contained in any other Loan
Document (as hereinafter defined).

 

    
Borrower covenants that Borrower is lawfully
seised of the estate hereby conveyed and has the right to grant,
convey and assign the Property (and, if this Instrument is on a
leasehold, that the ground lease is in full force and effect
without modification except as noted above and without default
on the part of either lessor or lessee thereunder), that the
Property is unencumbered, and that Borrower will warrant and
defend generally the title to the Property against all claims
and demands, subject to any easements and restrictions listed in
a schedule of exceptions to coverage in any title insurance
policy insuring Lender’s interest in the Property.

UNIFORM COVENANTS. Borrower and Lender covenant
and agree as follows:

1.    PAYMENT OF PRINCIPAL
AND INTEREST. Borrower shall promptly pay when due the principal
of and interest on the indebtedness evidenced by the Note, any
prepayment and late charges provided in the Note and all other
sums secured by this Instrument.

2.    FUNDS FOR TAXES,
INSURANCE AND OTHER CHARGES. Subject to applicable law or to a
written waiver by Lender, Borrower shall pay to Lender on the
day monthly installments of principal or interest are payable
under the Note (or on another day designated in writing by
Lender), until the Note is paid in full, a sum (herein
“Funds”) equal to one-twelfth of (a) the yearly
taxes and assessments which may be levied on the Property,
(b) the yearly ground rents, if any, (c) the yearly
premium installments for fire and other hazard insurance, rent
loss insurance and such other insurance covering the Property as
Lender may require pursuant to paragraph 5 hereof,
(d) the yearly premium installments for mortgage insurance,
if any, and (e) if this Instrument is on a leasehold, the
yearly fixed rents, if any, under the ground lease, all as
reasonably estimated initially and from time to time by Lender
on the basis of assessments and bills and reasonable estimates
thereof. Any waiver by Lender of a requirement that Borrower pay
such Funds may be revoked by Lender, in Lender’s sole
discretion, at any time upon notice in writing to Borrower.
Lender may require Borrower to pay to Lender, in advance, such
other Funds for other taxes, charges, premiums, assessments and
impositions in connection with Borrower or the Property which
Lender shall reasonably deem necessary to protect Lender’s
interests (herein “Other Impositions”). Unless
otherwise provided by applicable law, Lender may require Funds
for Other Impositions to be paid by Borrower in a lump sum or in
periodic installments, at Lender’s option.

    
The Funds shall be held in an institution(s) the
deposits or accounts of which are insured or guaranteed by a
Federal or state agency (including Lender if Lender is such an
institution). Lender shall apply the Funds to pay said rents,
taxes, assessments, insurance premiums and Other Impositions so
long as Borrower is not in breach of any covenant or agreement
of Borrower in this Instrument. Lender shall make no charge for
so holding and applying the Funds, analyzing said account or for
verifying and compiling said assessments and bills, unless
Lender pays Borrower interest, earnings or profits on the Funds
and applicable law permits Lender to make such a charge.
Borrower and Lender may agree in writing at the time of
execution of this Instrument that interest on the Funds shall be
paid to Borrower, and unless such agreement is made or
applicable law requires interest, earnings or profits to be
paid, Lender shall not be required to pay Borrower any interest,
earnings or profits on the Funds. Lender shall give to Borrower,
without charge, an annual accounting of the Funds in
Lender’s normal format showing credits and debits to the
Funds and the purpose for which each debit to the Funds was
made. The Funds are pledged as additional security for the sums
secured by this Instrument.

    
If the amount of the Funds held by Lender at the
time of the annual accounting thereof shall exceed the amount
deemed necessary by Lender to provide for the payment of taxes,
assessments, insurance premiums, rents and Other Impositions, as
they fall due, such excess shall be credited to Borrower on the
next monthly installment or installments of Funds due. If at any
time the amount of the Funds held by Lender shall be less than
the amount deemed necessary by Lender to pay taxes, assessments,
insurance premiums, rents and Other Impositions, as they fall
due, Borrower shall pay to Lender any amount necessary to make
up the deficiency within thirty days after notice from Lender to
Borrower requesting payment thereof.

    
Upon Borrower’s breach of any covenant or
agreement of Borrower in this Instrument, Lender may apply, if
any amount and in any order as Lender shall determine in
Lender’s sole discretion, any Funds held by Lender at the
time of application (i) to pay rents, taxes, assessments,
insurance premiums and Other Impositions which are now or will
hereafter become due, or (ii) as a credit against sums
secured by this Instrument. Upon payment in full of all sums
secured by this Instrument, Lender shall promptly refund to
Borrower any Funds held by Lender.

3.    APPLICATION OF
PAYMENTS. Unless applicable law provides otherwise, all payments
received by Lender from Borrower under the Note or this
Instrument shall be applied by Lender in the following order of
priority: (i) amounts payable to Lender by Borrower under
paragraph 2 hereof; (ii) interest payable on the Note;
(iii) principal of the Note; (iv) interest payable on
advances made pursuant to paragraph 8 hereof;
(v) principal of advances made pursuant to paragraph 8
hereof; (vi) interest payable on any Future Advance,
provided that if more than one Future Advance is outstanding,
Lender may apply payments received among the amounts of interest
payable on the Future Advances in such order as Lender, in
Lender, in Lenders’ sole discretion, may determine;
(vii) principal of any Future Advance, provided that if
more than one Future Advance is outstanding, Lender may apply
payments received among the principal balances of the Future
Advances in such order as Lender, in Lender’s sole
discretion, may determine; and (viii) any other sums
secured by this Instrument in such order as Lender, at
Lender’s option, may determine: provided, however, that
Lender may, at Lender’s option, apply any sums payable
pursuant to paragraph 8 hereof prior to interest on and
principal of the Note, but such application shall not otherwise
affect the order of priority of application specified in this
paragraph 3.

4.    CHARGES; LIENS.
Borrower shall pay all rents, taxes, assessments, premiums, and
Other Impositions attributable to the Property at Lender’s
option in the manner provided under paragraph 2 hereof or,
if not paid in such manner, by Borrower making payment, when
due, directly to the payee thereof, or in such other manner as
Lender may designate in writing. Borrower shall promptly furnish
to Lender all notices of amounts due under this
paragraph 4, and in the event Borrower shall make payment
directly, Borrower shall promptly furnish to Lender receipts
evidencing such payments. Borrower shall promptly discharge any
lien, which has, or may have, priority over or equality with,
the lien of this Instrument, and Borrower shall pay, when due,
the claims of all persons supplying labor or materials to or in
connection with the Property. Without Lender’s prior
written permission, Borrower shall not allow any lien inferior
to this Instrument to be perfected against the Property.

5.    HAZARD INSURANCE.
Borrower shall keep the improvements now existing or hereafter
erected on the Property insured by carriers at all times
satisfactory to Lender against loss by fire, hazards included
within the term “extended coverage”, rent loss and
such other hazards, casualties, liabilities and contingencies as
Lender (and, if this Instrument is on a leasehold, the ground
lease) shall require and in such amounts and for such periods as
Lender shall require. Borrower shall purchase policies of
insurance with respect to the Property with such insurers, in
such amounts and covering such risks as shall be satisfactory to
Lender, including, but not limited to, (i) personal injury
and death; (ii) loss or damage by fire, lightning, hail,
windstorm, explosion, hurricane (to the extent available), and
such other hazards, casualties and contingencies (including at
least twelve (12) months rental insurance in an amount
equal to the gross rentals for such period and broad form boiler
and machinery insurance) as are normally and usually covered by
extended coverage policies in effect where the Property is
located and comprehensive general public liability insurance in
an amount not less than $2,000,000.00 per occurrence, together
with $3,000,000.00 excess liability coverage and containing an
“Ordinance or Law Coverage” or “Enforcement”
endorsement if any of the improvements or the use of the
Property shall at any time constitute legal nonconforming
structures or uses; provided, that each policy shall provide by
way of endorsement, rider or otherwise that no such insurance
policy shall be cancelled, endorsed, altered, or reissued

2

 

to effect a change in coverage unless such
insurer shall have first given Lender thirty (30) days
prior written notice thereof, such policy shall be on a
replacement cost new basis, with a waiver of depreciation, in an
amount not less than that necessary to comply with any
coinsurance percentage stipulated in the policy, but not less
than the greater of (a) one hundred percent (100%) of the
insurable value (based upon replacement cost new) of the
Property and (b) $2,040,600.00, and the deductible clause,
if any, of the fire and extended coverage policy may not exceed
the lesser of one percent (1%) of the face amount of the policy
or $1,000.00; (iii) loss or damage by flood, if the
Property is in an area designated by the Secretary of Housing
and Urban Development as an area having special flood hazards,
in an amount equal to the principal amount of the Note or the
maximum amount available under the Flood Disaster Protection Act
of 1973, and regulations issued pursuant thereto, as amended
from time to time, whichever is less, in form complying with the
’‘insurance purchase requirement” of that Act;
and (iv) such other insurance and endorsements, if any, as
Lender may require from time to time, or which is required by
the Loan Documents. Borrower shall cause all insurance (except
general public liability insurance) carried in accordance with
this paragraph 5 to be payable to Lender as a mortgagee and
not as a coinsured, and, in the case of all policies of
insurance carried by each lessee for the benefit of Borrower, if
any, to cause all such policies to be payable to Lender as
Lender’s interest may appear. All premiums on insurance
policies shall be paid, in the manner provided under
paragraph 2 hereof, or in such other manner as Lender may
designate in writing.

    
All insurance policies and renewals shall be in a
form acceptable to Lender and shall include a standard mortgagee
clause in favor of and in form acceptable to Lender. Lender
shall have the right to hold the policies, and Borrower shall
promptly furnish to Lender all renewal notices and all receipts
of paid premiums. At least thirty (30) days prior to the
expiration date of a policy, Borrower shall deliver to Lender a
renewal policy in form satisfactory to Lender. If this
Instrument is on a leasehold, Borrower shall furnish Lender a
duplicate of all policies, renewal notices, renewal polices and
receipts of paid premiums if, by virtue of the ground lease, the
originals thereof may not be supplied by Borrower to Lender.

    
In the event of loss, Borrower shall give
immediate written notice to the insurance carrier and to Lender.
Borrower hereby authorizes and empowers Lender as
attorney-in-fact for Borrower to make proof of loss, to adjust
and compromise any claim under insurance policies, to appear in
and prosecute any action arising from such insurance policies,
to collect and receive insurance proceeds, and to deduct
therefrom Lender’s expenses incurred in the collection of
such proceeds; provided however, that nothing contained in this
paragraph 5 shall require Lender to incur any expense or
take any action hereunder. Borrower further authorizes Lender,
at Lender’s option, (a) to hold the balance of such
proceeds to be used to reimburse Borrower for the cost of
reconstruction or repair of the Property or (b) subject to
the immediately following paragraph, to apply such proceeds to
the payment of the sums secured by this Instrument whether or
not then due, in the order of application set forth in
paragraph 3 hereof (subject, however, to the rights of the
lessor under the ground lease if this Instrument is on a
leasehold).

    
Lender shall not exercise Lender’s option to
apply insurance proceeds to the payment of the sums secured by
this Instrument if all of the following conditions are met:
(i) Borrower is not in breach or default of any covenant or
agreement of this Instrument, the Note or any other Loan
Document; (ii) Lender determines that there will be
sufficient funds to restore and repair the Property to the
Pre-existing Condition (as hereinafter defined);
(iii) Lender agrees in writing that the rental income of
the Property, after restoration and repair of the Property to
the Pre-existing Condition, will be sufficient to meet all
operating costs and other expenses, payments for reserves and
loan repayment obligations (including any obligations under any
permitted subordinate financing) relating to the Property and
maintain a debt service coverage ratio of at least 1.75 to 1.0;
(iv) Lender determines that restoration and repair of the
property to the Pre-existing Condition will be completed within
one year of the date of the loss or casualty to the property,
but in no event later than six months prior to the Maturity
Date; (v) less than fifty percent (50%) of the total floor
area of the improvements has been damaged, destroyed or rendered
unusable as a result of such fire or other casualty;
(vi) tenant leases demising in the aggregate at least fifty
percent (50%) of the total rentable space in the Property and in
effect as of the date of the occurrence of such fire or other
casualty remain in full force and effect during and after the
completion of the restoration and repair of the Property and
Borrower furnishes to Lender evidence satisfactory to Lender
that [NONE] shall continue to operate their respective stores or
businesses at the Property notwithstanding the occurrence of any
such fire or other casualty; and (vii) Lender is reasonably
satisfied that the Property can be restored and repaired as
nearly as possible to the condition it was in immediately prior
to such casualty and in compliance with all applicable zoning,
building and other laws and codes (the “Pre-existing
Condition”). If Lender elects to make the insurance
proceeds available for the restoration and repair of the
Property, Borrower agrees that, if at any time during the
restoration and repair, the cost of completing such restoration
and repair, as determined by Lender, exceeds the undisbursed
insurance proceeds, Borrower shall, immediately upon demand by
Lender, deposit the amount of such excess with Lender, and
Lender shall first disburse such deposit to pay for the costs of
such restoration and repair on the same terms and conditions as
the insurance proceeds are disbursed.

    
If the insurance proceeds are held by Lender to
reimburse Borrower for the cost of restoration and repair of the
Property, the Property shall be restored to the equivalent of
its original condition or such other condition as Lender may
approve in writing. Lender may, at Lender’s option,
condition disbursement of said proceeds on Lender’s
approval of such plans and specifications of an architect
satisfactory to Lender, contractor’s cost estimates,
architect’s certificates, waivers of liens, sworn
statements of mechanics and materialmen and such other evidence
of costs, percentage completion of construction, application of
payments; and satisfaction of liens as Lender may reasonably
require. If the insurance proceeds are applied to the payment of
the sums secured by this Instrument, any such application of
proceeds to principal shall not extend or postpone the due dates
of the monthly installments referred to in paragraphs 1 and
2 hereof or change the amounts of such installments. If the
Property is sold pursuant to paragraph 27 hereof or if
Lender acquires title to the Property, Lender shall have all of
the right, title and interest of Borrower in and to any
insurance policies and unearned premiums thereon and in and to
the proceeds resulting from any damage to the Property prior to
such sale or acquisition.

6. PRESERVATION AND MAINTENANCE OF PROPERTY;
LEASEHOLDS. Borrower (a) shall not commit waste or permit
impairment or deterioration of the Property, (b) shall not
abandon the Property, (c) shall restore or repair promptly
and in a good and workmanlike manner all or any part of the
Property to the equivalent of its original condition, or such
other condition as Lender may approve in writing, in the event
of any damage, injury or loss thereto, whether or not insurance
proceeds are available to cover in whole or in part the costs of
such restoration or repair, (d) shall keep the Property,
including improvements, fixtures, equipment, machinery and
appliances thereon in good repair and shall replace fixtures,
equipment, machinery and appliances on the Property when
necessary to keep such items in good repair, (e) shall
comply with all laws, ordinances, regulations and requirements
of any governmental body applicable to the Property,
(f) shall provide for professional management of the
Property by a retail rental property manager satisfactory to
Lender pursuant to a contract approved by Lender in writing,
unless such requirement shall be waived by Lender in writing,
(g) shall generally operate and maintain the Property in a
manner to ensure maximum rentals, and (h) shall give notice
in writing to Lender of and, unless otherwise directed in
writing by Lender, appear in and defend any action or proceeding
purporting to affect the Property, the security of this
Instrument or the rights of powers of Lender. Neither Borrower
nor any tenant or other person shall remove, demolish or alter
any improvement now existing or hereafter erected on the
Property or any fixture, equipment, machinery or appliance in or
on the Property except when incident to the replacement of
fixtures, equipment, machinery and appliances with items of like
kind.

    
If this Instrument is on a leasehold, Borrower
(i) shall comply with the provisions of the ground lease,
(ii) shall give immediate written notice to Lender of any
default by lessor under the ground lease or of any notice
received by Borrower from such lessor of any default under the
ground lease by Borrower, (iii) shall exercise any option
to renew or extend the ground lease and give written
confirmation thereof to Lender within thirty days after such
option becomes exercisable, (iv) shall give immediate

3

 

written notice to Lender of the commencement of
any remedial proceedings under the ground lease by any party
thereto and, if required by Lender, shall permit Lender as
Borrower’s attorney-in-fact to control and act for Borrower
in any such remedial proceedings and (v) shall within
thirty days after request by Lender obtain from the lessor under
the ground lease and deliver to Lender the lessor’s
estoppel certificate required thereunder, if any. Borrower
hereby expressly transfers and assigns to Lender the benefit of
all covenants contained in the ground lease, whether or not such
covenants run with the land, but Lender shall have no liability
with respect to such covenants nor any other covenants contained
in the ground lease.

    
Borrower shall not surrender the leasehold estate
and interests herein conveyed nor terminate or cancel the ground
lease creating said estate and interests, and Borrower shall
not, without the express written consent of Lender, alter or
amend said ground lease. Borrower covenants and agrees that
there shall not be a merger of the ground lease, or of the
leasehold estate created thereby, with the fee estate covered by
the ground lease by reason of said leasehold estate or said fee
estate, or any part of either, coming into common ownership,
unless Lender shall consent in writing to such merger, if
Borrower shall acquire such fee estate, then this instrument
shall simultaneously and without further action be spread so as
to become a lien on such fee estate.

7.    USE OF PROPERTY. Unless
required by applicable law or unless Lender has otherwise agreed
in writing, Borrower shall not allow changes in the use for
which all or any part of the Property was intended at the time
this Instrument was executed. Borrower shall not subdivide the
Property or initiate or acquiesce in a change in the zoning
classification of the Property without Lender’s prior
written consent.

8.    PROTECTION OF
LENDER’S SECURITY. If Borrower fails to perform the
covenants and agreements contained in this Instrument, or if any
action or proceeding is commenced which affects the Property or
title thereto or the interest of Lender therein, including, but
not limited to, eminent domain, insolvency, code enforcement, or
arrangements or proceedings involving a bankrupt or decedent,
then Lender at Lender’s option may make such appearances,
disburse such sums and take such action as Lender deems
necessary, in its sole discretion, to protect Lender’s
interest, including, but not limited to, (i) disbursement
of attorney’s fees, (ii) entry upon the Property to
make repairs, (iii) procurement of satisfactory insurance
as provided in paragraph 5 hereof, (iv) if this
Instrument is on a leasehold, exercise of any option to renew or
extend the ground lease on behalf of Borrower and the curing of
any default of Borrower in the terms and conditions of the
ground lease, and (v) the payment of any taxes and/or
assessments levied against the Property and then due and payable.

    
Any amounts disbursed by Lender pursuant to this
paragraph 8, with interest thereon, shall become additional
indebtedness of Borrower secured by this Instrument. Unless
Borrower and Lender agree to other terms of payment, such
amounts shall be immediately due and payable and shall bear
interest from the date of disbursement at the rate stated in the
Note unless collection from Borrower of interest at such rate
would be contrary to applicable law, in which event such amounts
shall bear interest at the highest rate which may be collected
from Borrower under applicable law. Borrower hereby covenants
and agrees that Lender shall be subrogated to the lien of any
mortgage or other lien discharged, in whole or in part, by the
indebtedness secured hereby. Nothing contained in this
paragraph 8 shall require Lender to incur any expense or
take any action hereunder.

9.    INSPECTION. Lender may
make or cause to be made reasonable entries upon and inspections
of the Property including, but not limited to, phase I
and/or phase II environmental audits and inspections which
phase II inspections will not unreasonably disturb
Borrower’s use of the Property.

10.    BOOKS AND RECORDS.
Borrower shall keep and maintain at all times at Borrower’s
address stated below, or such other place as Lender may approve
in writing, complete and accurate books of accounts and records
adequate to reflect correctly the results of the operation of
the Property and copies of all written contracts, leases and
other instruments which affect the Property. Such books,
records, contracts, leases and other instruments shall be
subject to examination and inspection at any reasonable time by
Lender. Upon Lender’s request, Borrower shall furnish to
Lender, within thirty (30) days after the end of each three
month quarter of each fiscal year of Borrower, a balance sheet,
a statement of income and expenses of the Property and a
statement of changes in financial position, each in reasonable
detail and certified by Borrower and, if Lender shall require,
by an independent certified public accountant. Borrower shall
furnish, together with the foregoing financial statements and at
any other time upon Lender’s request, a rent schedule for
the Property, certified by Borrower, showing the name of each
tenant, and for each tenant, the space occupied, the lease
expiration date, the rent payable and the rent paid. In addition
to the above delivery of financial statements and rent schedule,
Borrower shall deliver to Lender updated versions of such
financial statements at any other time upon Lender’s
request, including monthly balance sheets and monthly statements
of income and expenses of the Property.

11.    CONDEMNATION. Borrower
shall promptly notify Lender of any action or proceeding
relating to any condemnation or other taking, whether direct or
indirect, of the Property, or part thereof, and Borrower shall
appear in and prosecute any such action or proceeding unless
otherwise directed by Lender in writing. Borrower authorizes
Lender, at Lender’s option, as attorney-in-fact for
Borrower, to commence, appear in and prosecute, in Lender’s
or Borrower’s name, any action or proceeding relating to
any condemnation or other taking of the Property, whether direct
or indirect, and to settle or compromise any claim in connection
with such condemnation or other taking. The proceeds of any
award, payment or claim for damages, direct or consequential, in
connection with any condemnation or other taking, whether direct
or indirect, of the Property, or part thereof, or for
conveyances in lieu of condemnation, are hereby assigned to and
shall be paid to Lender subject, if this Instrument is on a
leasehold, to the rights of lessor under the ground lease.

    
Borrower authorizes Lender to apply such awards,
payments, proceeds or damages, after the deduction of
Lender’s expenses incurred in the collection of such
amounts, at Lender’s option, to restoration or repair of
the Property or to payment of the sums secured by this
Instrument, whether or not then due, in the order of application
set forth in paragraph 3 hereof, with the balance, if any, to
Borrower. Unless Borrower and Lender otherwise agree in writing,
any application of proceeds to principal shall not extend or
postpone the due date of the monthly installments referred to in
paragraphs 1 and 2 hereof or change the amount of such
installments. Borrower agrees to execute such further evidence
of assignment of any awards, proceeds, damages or claims arising
in connection with such condemnation or taking as Lender may
require.

12.    BORROWER AND LIEN NOT
RELEASED. From time to time, Lender may, at Lender’s
option, without giving notice to or obtaining the consent of
Borrower, Borrower’s successors or assigns or of any junior
lienholder or guarantors, without liability on Lender’s
part and notwithstanding Borrower’s breach of any covenant
or agreement of Borrower in this Instrument, extend the time for
payment of said indebtedness or any part thereof, reduce the
payments thereon, release anyone liable on any of said
indebtedness, accept a renewal note or notes therefor, modify
the terms and time of payment of said indebtedness, release from
the lien of this Instrument any part of the Property, take or
release other or additional security, reconvey any part of the
Property, consent to any map or plan of the Property, consent to
the granting of any easement, join in any extension or
subordination agreement, and agree in writing with Borrower to
modify the rate of interest or period of amortization of the
Note or change the amount of the monthly installments payable
thereunder. Any actions taken by Lender pursuant to the terms of
this paragraph 12 shall not affect the obligation of
Borrower or Borrower’s successors or assigns to pay the
sums secured by this Instrument and to observe the covenants of
Borrower contained herein, shall not affect the guaranty of any
person, corporation, partnership or other entity for payment of
the Indebtedness secured hereby, and shall not affect the lien
or priority of lien hereof on the

4

 

Property. Borrower shall pay Lender a reasonable
service charge, together with such title insurance premiums and
attorney’s fees as may be incurred at Lender’s option,
for any such action if taken at Borrower’s request.

13.    FORBEARANCE BY LENDER
NOT A WAIVER. Any forbearance by Lender in exercising any right
or remedy hereunder, or otherwise afforded by applicable law,
shall not be a waiver of or preclude the exercise of any right
or remedy. The acceptance by Lender of payment of any sum
secured by this Instrument after the due date of such payment
shall not be a waiver of Lender’s right to either require
prompt payment when due of all other sums so secured or to
declare a default for failure to make prompt payment. The
procurement of insurance or the payment of taxes or other liens
or charges by Lender shall not be a waiver of Lender’s
right to accelerate the maturity of the indebtedness secured by
this Instrument, nor shall Lender’s receipt of any awards,
proceeds or damages under paragraphs 5 and 11 hereof
operate to cure or waive Borrower’s default in payment of
sums secured by this Instrument.

14.    ESTOPPEL CERTIFICATE.
Borrower shall within ten (10) days of a written request
from Lender furnish Lender with a written statement, duly
acknowledged, setting forth the sums secured by this Instrument
and any right of set off, counterclaim or other defense which
exists against such sums and the obligations of this Instrument
and attaching true, correct and complete copies of the Note,
this Instrument and any other Loan Documents and any and all
modifications, amendments and substitutions thereof.

15.    UNIFORM COMMERCIAL
CODE SECURITY AGREEMENT. This Instrument is intended to be a
security agreement pursuant to the Uniform Commercial Code for
any of the items specified above as part of the Property which,
under applicable law, may be subject to a security interest
pursuant to the Uniform Commercial Code, and Borrower hereby
grants Lender a security interest in said items. Borrower agrees
that Lender may file this Instrument, or a reproduction thereof,
in the real estate records or other appropriate index, as a
financing statement for any of the items specified above as part
of the Property. Any reproduction of this Instrument or of any
other security agreement or financing statement shall be
sufficient as a financing statement. In addition, Borrower
agrees to execute and deliver to Lender, upon Lender’s
request, any financing statements, as well as extensions,
renewals and amendments thereof, and reproductions of this
Instrument in such form as Lender may require to perfect a
security interest with respect to said items. Borrower shall pay
all costs of filing such financing statements and any
extensions, renewals, amendments and releases thereof, and shall
pay all reasonable costs and expenses of any record searches for
financing statements Lender may reasonably require. Without the
prior written consent of Lender, Borrower shall not create or
suffer to be created pursuant to the Uniform Commercial Code any
other security interest in said items, including replacements
and additions thereto. Upon Borrower’s breach of any
covenant or agreement of Borrower contained in this instrument,
including the covenants to pay when due all sums secured by this
Instrument, Lender shall have the remedies of a secured party
under the Uniform Commercial Code and, at Lender’s option,
may also invoke the remedies provided in paragraph 27 of
this Instrument as to such items. In exercising any of said
remedies, Lender may proceed against the items of real property
and any items of personal property specified above as part of
the Property separately or together and in any order whatsoever,
without in any way affecting the availability of Lender’s
remedies under the Uniform Commercial Code or of the remedies
provided in paragraph 27 of this Instrument.

16.    LEASES OF THE
PROPERTY. As used in this paragraph 16, the word
“lease” shall mean “sublease” if this
Instrument is on a leasehold. Borrower shall comply with and
observe Borrower’s obligations as landlord under all leases
of the Property or any part thereof. Borrower will not lease any
portion of the Property for non-office use except with the prior
written approval of Lender. Borrower may execute or modify,
without Lender’s prior written consent, any lease of space
at the Property now existing or hereafter made which affects the
lesser of N/A% of the gross leasable area of the Property or
5000 square feet and provided the term of such lease is less
than N/A years (an “Exempt Lease”), provided such
lease:

			
	 	(i)	
    is on a standard lease form pre-approved by
    Lender;
    

			
	 	(ii) 	
    is at a net effective rent (after taking into
    account any free rent, construction allowances or other
    concessions granted by landlord) no less than the current actual
    rent or fair market rent then prevailing for similar properties
    and leases in the market area;
    

			
	 	(iii)	
    contains rent or other concessions which are
    customary and reasonable for similar properties and leases in
    the market area;
    

			
	 	(iv)	
    represents a bona fide arm’s length
    transaction;
    

			
	 	(v) 	
    does not permit any use which would violate any
    provision of any existing lease or is otherwise inconsistent
    with the uses and quality of existing tenants;
    

			
	 	(vi)	
    is provided to Lender within ten (10) days
    after execution;
    

			
	 	(vii) 	
    as modified or amended does not become a lease
    which fails to satisfy the criteria for an Exempt Lease pursuant
    to this paragraph 16;
    

			
	 	(viii) 	
    as modified or amended does not materially modify
    the financial terms of Borrower’s standard form of lease or
    materially reduce the rights and remedies of the Borrower or
    Lender under said standard lease;
    

			
	 	(ix)	
    is subordinate by its terms to this Instrument;
    provides that the tenant thereunder is required to attorn to
    Lender, such attornment to be effective upon Lender’s
    acquisition of title to the Property; that the tenant agrees to
    execute such further evidences of attornment as Lender may from
    time to time request; that the attornment of the tenant shall
    not be terminated by foreclosure; that in no event shall Lender,
    as holder of this Instrument or as successor landlord, be liable
    to the tenant for any act or omission of any prior landlord or
    for any liability or obligation of any prior landlord occurring
    prior to the date that Lender or any subsequent owner acquire
    title to the Property; and that Lender may, at Lender’s
    option, accept or reject such attornment.
    

    
Borrower shall be required to obtain
Lender’s consent, which shall not be unreasonably withheld
or delayed, for any lease and subleases at the Property other
than an Exempt Lease. The request for approval of each such
proposed lease shall be made to Lender in writing and Borrower
shall furnish to Lender (and any loan servicer specified from
time to time by Lender): (i) such biographical and
financial information about the proposed tenant as Lender may
require in conjunction with its review, (ii) a copy of the
proposed form of lease, and (iii) a summary of the material
terms of such proposed lease (including, without limitation,
rental terms and the term of the proposed lease and any options).

    
Borrower, at Lender’s request, shall furnish
Lender with executed copies of all leases hereafter made of all
or any part of the Property, and all leases hereafter entered
into will be in form and substance subject to the approval of
Lender. All leases

5

 

of the Property or a separate agreement in
recordable form and substance satisfactory to Lender shall
specifically provide that such leases are subordinate to this
instrument; that the tenant attorns to Lender, such attornment
to be effective upon Lender’s acquisition of title to the
Property; that the tenant agrees to execute such further
evidences of attornment as Lender may from time to time request;
that the attornment of the tenant shall not be terminated by
foreclosure; that in no event shall Lender, as holder of this
Instrument or as successor landlord, be liable to the tenant for
any act or omission of any prior landlord or for any liability
or obligation of any prior landlord occurring prior to the date
that Lender or any subsequent owner acquire title to the
Property; and that Lender may, at Lender’s option, accept
or reject such attornments. Except as otherwise provided in this
paragraph 16, Borrower shall not, without Lender’s
written consent, execute, modify, surrender or terminate, either
orally or in writing, any lease now existing or hereafter made
of all or any part of the Property, permit an assignment or
sublease of a lease without Lender’s written consent, or
request or consent to the subordination of any lease of all or
any part of the Property to any lien subordinate to this
Instrument. If Borrower becomes aware that any tenant proposes
to do, or is doing, any act or thing which may give rise to any
right of set-off against rent, Borrower shall (i) take such
steps as shall be reasonably calculated to prevent the accrual
of any right to a set-off against rent, (ii) notify Lender
thereof and of the amount of said set-offs, and
(iii) within ten (10) days after such accrual,
reimburse the tenant who shall have acquired such right to set
off or take such other steps as shall effectively discharge such
set-off and as shall assure that rents thereafter due shall
continue to be payable without set-off or deduction.

    
Upon Lender’s request, Borrower shall
absolutely assign to Lender, by written instrument satisfactory
to Lender, all leases now existing or hereafter made of all or
any part of the Property and all security deposits made by
tenants in connection with such leases of the Property. Upon
assignment by Borrower to Lender of any leases of the Property,
Lender shall have all of the rights and powers possessed by
Borrower prior to such assignment and Lender shall have the
right to modify, extend or terminate such existing leases and to
execute new leases, in Lender’s sole discretion.

17.    REMEDIES CUMULATIVE.
Each remedy provided in this Instrument is distinct and
cumulative to all other rights or remedies under this Instrument
or afforded by law or equity, and may be exercised concurrently,
independently, or successively, in any order whatsoever.

18.    ACCELERATION IN CASE
OF BORROWER’S INSOLVENCY. If Borrower shall voluntarily
file a petition under Title 11 of the U.S. Code (the
“Act”), as such Act may from time to time be amended,
or under any similar or successor Federal statute relating to
bankruptcy, insolvency, arrangements or reorganizations, or
under any state bankruptcy or insolvency act, or file an answer
in any involuntary proceeding admitting insolvency or inability
to pay debts, or if Borrower shall fail to obtain a vacation or
stay of involuntary proceedings brought for the reorganization,
dissolution or liquidation of Borrower, within on hundred and
twenty (120) days of the filing of such involuntary
proceeding, or if Borrower shall be adjudged a bankrupt, or if a
trustee or receiver shall be appointed for Borrower or
Borrower’s property, or if the Property shall become
subject to the jurisdiction of a Federal bankruptcy court or
similar state court, or if Borrower shall make an assignment for
the benefit of Borrower’s creditors, or if there is an
attachment, execution or other judicial seizure of any portion
of Borrower’s assets and such seizure is not discharged
within ten days, then Lender may, at Lender’s option,
declare all of the sums secured by this Instrument to be
immediately due and payable without prior notice to Borrower,
and Lender may invoke any remedies permitted by
paragraph 27 of this Instrument. Any attorney’s fees
and other expenses incurred by Lender in connection with
Borrower’s bankruptcy or any of the other aforesaid events
shall be additional indebtedness of Borrower secured by this
Instrument pursuant to paragraph 8 hereof.

 

		
	19.	
    TRANSFERS OF THE PROPERTY OF BENEFICIAL INTERESTS
    IN BORROWER.
    

    
(a) Except as provided in
subparagraph (c) of this paragraph 19, upon the sale
or transfer of (i) all or any part of the Property, or any
interest therein, or (ii) beneficial interests in Borrower
(if Borrower is not a natural person or persons but is a
corporation, partnership, trust or other legal entity), Lender
may, at Lender’s option, declare all of the sums secured by
this Instrument to be immediately due and payable, and Lender
may invoke any remedies permitted by paragraph 27 of this
Instrument.

    
(b) For purposes of this paragraph 19,
a sale or transfer of a beneficial interest in Borrower shall be
deemed to include, but is not limited to:

			
	 	(i) 	
    if Borrower or any general partner of Borrower is
    a corporation or limited liability company, the voluntary or
    involuntary sale, conveyance, transfer or pledge of a majority
    of such corporation’s or limited liability company’s
    stock or beneficial interests (or the stock or beneficial
    interests of any corporation directly or indirectly controlling
    such corporation or limited liability company by operation of
    law or otherwise) or the creation or issuance of new stock or
    beneficial interests by which an aggregate of more than 49% of
    such corporation’s or limited liability company’s
    stock or beneficial interests shall be vested in a party or
    parties who are not now holders of stock or beneficial interests;
    

			
	 	(ii) 	
    if Borrower is a limited liability company, the
    change, removal or resignation of a managing member;
    

			
	 	(iii) 	
    if Borrower, or any general partner of Borrower,
    is a limited or general partnership, the change, removal or
    resignation of a general partner or managing partner or the
    transfer or pledge of the partnership interest of any general
    partner or managing partner or any profits or proceeds relating
    to such partnership interest;
    

			
	 	(iv) 	
    if Borrower is a limited partnership, the
    transfer or pledge of a majority of the limited partnership
    interests which in the aggregate constitute more than a 49%
    interest in Borrower, or any profits or proceeds relating to
    such limited partnership interests.
    

    
(c) Notwithstanding the forgoing, the
following shall not be deemed a sale or transfer of a beneficial
interest in Borrower for purposes of this paragraph 19:

			
	 	(i) 	
    a transfer of less than a 49% interest in
    Borrower, or any partner, shareholder or member of Borrower, by
    devise, descent or by operation of law upon the death of a
    partner, member or stockholder of Borrower;
    

			
	 	(ii) 	
    a transfer of a limited partner, shareholder or
    non-managing member interest in Borrower for estate planning
    purposes to an immediate family member of such limited partner,
    shareholder or member, or a trust for the benefit of an
    immediate family member; or
    

			
	 	(iii) 	
    a transfer of a general partner or managing
    member interest in Borrower for estate planning purposes to an
    immediate family member of such partner or member, or a trust
    for the benefit
    

6

 

		
	 	
    of an immediate family member, subject to
    obtaining Lender’s prior written consent, which consent
    shall not be unreasonably withheld subject to the criteria set
    forth in subparagraph (b) of
    paragraph 35 of this Instrument.
    

    
See paragraph 35 of this Instrument.

20.    NOTICE.
Except for any notice required under applicable law to be given
in another manner, (a) any notice to Borrower provided for
in this Instrument or in the Note shall be given by mailing such
notice by certified mail addressed to Borrower at
Borrower’s address stated above or at such other address as
Borrower may designate by notice to Lender as provided herein,
and (b) any notice to Lender shall be given by certified
mail, return receipt requested, to Lender’s address stated
herein or to such other address as Lender may designate by
notice to Borrower as provided herein. Any notice provided for
in this Instrument or in the Note shall be deemed to have been
given to Borrower or Lender when given in the manner designated
herein.

21.    SUCCESSORS
AND ASSIGNS BOUND; JOINT AND SEVERAL LIABILITY; AGENTS;
CAPTIONS. The covenants and agreements herein contained
shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Lender and Borrower,
subject to the provisions of paragraph 19 hereof.
All covenants and agreements of Borrower shall be joint and
several. In exercising any rights hereunder or taking any
actions provided for herein, Lender may act through its
employees, agents or independent contractors as authorized by
Lender. The captions and headings of the paragraphs of this
Instrument are for convenience only and are not to be used to
interpret or define the provisions hereof.

22.    UNIFORM
INSTRUMENT; GOVERNING LAW; SEVERABILITY. This form of
instrument combines uniform covenants for national use and
non-uniform covenants with limited variations by jurisdiction to
constitute a uniform security instrument covering real property
and related fixtures and personal property. This Instrument
shall be governed by the law of the jurisdiction in which the
Property is located. In the event that any provision of this
Instrument or the Note conflicts with applicable law, such
conflict shall not affect other provisions of this Instrument or
the Note which can be given effect without the conflicting
provisions, and to this end the provisions of this Instrument
and the Note are declared to be severable. In the event that any
applicable law limiting the amount of interest or other charges
permitted to be collected from Borrower is interpreted so that
any charge provided for in this Instrument or in the Note,
whether considered separately or together with other charges
levied in connection with this Instrument and the Note, violates
such law, and Borrower is entitled to the benefit of such law,
such charge is hereby reduced to the extent necessary to
eliminate such violation. The amounts, if any, previously paid
to Lender in excess of the amounts payable to Lender pursuant to
such charges as reduced shall be applied by Lender to reduce the
principal of the indebtedness evidenced by the Note. For the
purposes of determining whether any applicable law limiting the
amount of interest or other charges permitted to be collected
from Borrower has been violated, all indebtedness which is
secured by this Instrument or evidenced by the Note and which
constitutes interest, as well as all other charges levied in
connection with such indebtedness which constitute interest,
shall be deemed to be allocated and spread over the stated term
of the Note. Unless otherwise required by applicable law, such
allocation and spreading shall be effected in such a manner that
the rate of interest computed thereby is uniform throughout the
stated term of the Note.

23.    WAIVER
OF STATUTE OF LIMITATIONS. Borrower hereby waives the right
to assert any statute of limitations as a bar to the enforcement
of the lien of this Instrument or to any action brought to
enforce the Note or any other obligation secured by this
Instrument.

24.    WAIVER
OF MARSHALLING. Notwithstanding the existence of any other
security interest in the 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 Property shall be subjected to the
remedies provided herein. Lender shall have the right to
determine the order in which any or all portions of the
indebtedness secured hereby are satisfied from the proceeds
realized upon the exercise of the remedies provided herein.
Borrower, any party who consents to this Instrument and any
party who now or hereafter acquires a security interest in the
Property and who has actual or constructive notice hereof hereby
waives any and all right to require the marshalling of assets in
connection with the exercise of any of the remedies permitted by
applicable law or provided herein.

25.    INTENTIONALLY
OMITTED.

26.    ASSIGNMENT
OF RENTS; APPOINTMENT OF RECEIVER; LENDER IN POSSESSION. As
part of the consideration for the indebtedness evidenced by the
Note, Borrower hereby absolutely and unconditionally assigns and
transfers to Lender all the rents and revenues of the Property,
including those now due, past due, or to become due by virtue of
any lease or other agreement for the occupancy or use of all or
any part of the Property, regardless of to whom the rents and
revenues of the Property are payable. Borrower hereby authorizes
Lender or Lender’s agents to collect the aforesaid rents
and revenues and hereby directs each tenant of the Property to
pay such rents to Lender or Lender’s agents; provided,
however, that prior to written notice given by Lender to
Borrower of the breach by Borrower of any covenant or agreement
of Borrower in this Instrument or any other Loan Document,
Borrower shall collect and receive all rents and revenues of the
Property as trustee for the benefit of Lender and Borrower, to
apply the rents and revenues so collected to the sums secured by
this Instrument in the order provided in paragraph 3
hereof with the balance, so long as no such breach has occurred,
to the account of Borrower, it being intended by Borrower and
Lender that this assignment of rents constitutes an absolute
assignment and not an assignment for additional security only.
Upon delivery of written notice by Lender to Borrower of the
breach by Borrower of any covenant or agreement of Borrower in
this Instrument, and without the necessity of Lender entering
upon and taking and maintaining full control of the Property in
person, by agent or by a court-appointed receiver, Lender shall
immediately be entitled to possession of all rents and revenues
of the Property as specified in this paragraph 26 as
the same become due and payable, including, but not limited to,
rents then due and unpaid, and all such rents shall immediately
upon delivery of such notice be held by Borrower as trustee for
the benefit of Lender only; provided, however, that the written
notice by Lender to Borrower of the breach by Borrower shall
contain a statement that Lender exercises its rights to such
rents. Borrower agrees that commencing upon delivery of such
written notice of Borrower’s breach by Lender to Borrower,
each tenant of the Property shall make such rents payable to and
pay such rents to Lender or Lender’s agents on
Lender’s written demand to each tenant therefor, delivered
to each tenant personally, by mail or by delivering such demand
to each retail store, without any liability on the part of said
tenant to inquire further as to the existence of a default by
Borrower.

    
Borrower hereby covenants that Borrower has not
executed any prior assignment of said rents, that Borrower has
not performed, and will not perform, any acts or has not
executed, and will not execute, any instrument which would
prevent Lender from exercising its rights under this
paragraph 26, and that at the time of execution of
this Instrument there has been no anticipation or prepayment of
any of the rents of the Property for more than one month prior
to the due dates of such rents. Borrower covenants that Borrower
will not hereafter collect or accept payment of any rents of the
Property more than one month prior to the due dates of such
rents. Borrower further covenants that Borrower will execute and
deliver to Lender such further assignments of rents and revenues
of the Property as Lender may from time to time request.

    
Upon Borrower’s breach of any covenant or
agreement of Borrower in this Instrument, or upon
Borrower’s breach of any material covenant of Borrower as
landlord or lessor under any lease, Lender shall be entitled to
the appointment of a receiver for the Property, without notice
to Borrower or any other person or entity and Lender may in
person, by agent or by a court-appointed receiver, regardless of
the adequacy of Lender’s security, enter upon and take and
maintain full control of the Property

7

 

in order to perform all acts necessary and
appropriate for the operation and maintenance thereof including,
but not limited to, the execution, cancellation or modification
of leases, the collection of all rents and revenues of the
Property, the enforcement or fulfillment of any terms, condition
or provision of any lease, the making of repairs to the Property
and the execution or termination of contracts providing for the
management or maintenance of the Property, all on such terms as
are deemed best to protect the security of this Instrument. In
the event Lender elects to seek the appointment of a receiver
for the Property upon Borrower’s breach of any covenant or
agreement of Borrower in this Instrument, Borrower hereby
expressly consents to the appointment of such receiver. Lender
or the receiver shall be entitled to receive a reasonable fee
for so managing the Property.

    
All rents and revenues collected subsequent to
delivery of written notice by Lender to Borrower of the breach
by Borrower of any covenant or agreement of Borrower in this
Instrument shall be applied first to the costs, if any, of
taking control of and managing the Property and collecting the
rents, including, but not limited to, attorney’s fees,
receiver’s fees, premiums on receiver’s bonds, costs
of repairs to the Property, premiums on insurance policies,
taxes, assessments and other charges on the Property, and the
costs of discharging any obligation or liability of Borrower as
lessor or landlord of the Property and then to the sums secured
by this Instrument. Lender or the receiver shall have access to
the books and records used in the operation and maintenance of
the Property and shall be liable to account only for those rents
actually received. Lender shall not be liable to Borrower,
anyone claiming under or through Borrower or anyone having an
interest in the Property by reason of anything done or left
undone by Lender under this paragraph 26.

    
If the rents of the Property are not sufficient
to meet the costs, if any, of taking control of and managing the
Property and collecting the rents, any funds expended by Lender
for such purposes shall become indebtedness of Borrower to
Lender secured by this Instrument pursuant to paragraph 8
hereof. Unless Lender and Borrower agree in writing to other
terms of payment, such amounts shall be payable upon notice from
Lender to Borrower requesting payment thereof and shall bear
interest from the date of disbursement at the rate stated in the
Note unless payment of interest at such rate would be contrary
to applicable law, in which event such amounts shall bear
interest at the highest rate which may be collected from
Borrower under applicable law.

    
Any entering upon and taking and maintaining of
control of the Property by Lender or the receiver and any
application of rents as provided herein shall not cure or waive
any default hereunder or invalidate any other right or remedy of
Lender under applicable law or provided herein. This assignment
of rents of the Property shall terminate at such time as this
Instrument ceases to secure indebtedness held by Lender.

NON-UNIFORM COVENANTS. Borrower and Lender
further covenant and agree as follows:

    
27. ACCELERATION; REMEDIES. Upon Borrower’s
breach of any representation, covenant or agreement of Borrower
in this Instrument, the Note, the Environmental Indemnity
Agreement or any other Loan Document, including, but not limited
to, the covenants to pay when due any sums secured by this
Instrument, Lender, at Lender’s option, may declare all of
the sums secured by this Instrument to be immediately due and
payable without further demand, and may invoke the power of sale
and any other remedies permitted by applicable law or provided
herein. Borrower acknowledges that the power of sale herein
granted may be exercised by Lender without prior judicial
hearing. Borrower has the right to bring an action to assert the
non-existence of a breach or any other defense of Borrower to
acceleration and sale. Lender shall be entitled to collect all
costs and expenses incurred in pursuing such remedies,
including, but not limited to, attorney’s fees and costs of
documentary evidence, abstracts and title reports.

    
Notwithstanding the foregoing, Lender shall not
invoke any remedy provided hereunder, under the Loan Documents,
at law or in equity upon Borrower’s breach of a
non-monetary representation, covenant, or agreement of Borrower
in this Instrument, the Note, the Environmental Indemnity
Agreement or any other Loan Document, other than a breach of
paragraphs 5, 19, 32(k), 32(l) or 32(n) of this Instrument,
or paragraph 2 of the Environmental Indemnity Agreement,
provided Borrower shall have, on or before the date that is
fifteen (15) days after Borrower’s receipt of notice
thereof, cured such default or, if such default cannot be cured
within such fifteen (15) day period, Borrower shall have
commenced to cure within such fifteen (15) day period and
is taking all actions required to diligently cure such default
and such default is cured on or before the date that is thirty
(30) days after Borrower’s receipt of a notice to cure
such default.

    
See paragraph 34 of this Instrument.

    
Trustee shall deliver to purchaser a
Trustee’s deed conveying the Property so sold without any
covenant or warranty, expressed or implied. The recitals in the
Trustee’s deed shall be prima facie evidence of the truth
of the statements made therein. Trustee shall apply the proceeds
of the sale in the following order: (a) to all costs and
expenses of the sale, including, but not limited to,
Trustee’s fees of TWO percent (2%) of the gross sale
price, attorney’s fees and costs of title evidence;
(b) to all sums secured by this Instrument in such order as
Lender, in Lender’s sole discretion, directs; and
(c) the excess, if any, to the person or persons legally
entitled thereto.

    
28. RELEASE. Upon payment of all sums secured by
this Instrument, Lender shall request Trustee to release this
Instrument and shall surrender all notes evidencing indebtedness
secured by this Instrument to Trustee. Trustee shall release
this Instrument. Borrower shall pay Trustee’s reasonable
costs incurred in releasing this Instrument.

    
29. SUBSTITUTE TRUSTEE; ACTION BY SINGLE TRUSTEE.
Lender at Lender’s option may from time to time appoint
additional or replacement trustees and may remove one or more
trustees, from time to time, without the consent of or notice to
Borrower, by an instrument recorded in the city or county in
which this Instrument is recorded. Without conveyance of the
Property, the successor trustee shall succeed to all the title,
power and duties conferred upon the Trustee herein and by
applicable law. Any Trustee, individually, may exercise all
powers granted to the Trustees collectively, without the
necessity of the joinder of the other Trustees.

    
30. NONRECOURSE LOAN. Subject to the
qualifications below in this paragraph, the Borrower shall be
liable for payment and performance of all of the obligations,
covenants and agreements of the Borrower under the Note, this
Instrument, the Assignment of Leases and Rents (herein
so-called), dated of even date herewith, executed by Borrower to
Lender, the Environmental Indemnity Agreement dated of even date
herewith, executed by Borrower and Lender, and all other
instruments and documents evidencing, securing or governing the
terms of the loan (the “Loan”) evidenced by the Note
(collectively, the “Loan Documents”), to the full
extent (but only to the extent) of all of the Property and any
other items, property or amounts which are collateral or
security for the Loan. If a default occurs in the timely and
proper payment of any portion of such indebtedness or in the
timely performance of any obligations, agreements or covenants,
except as set forth below in this paragraph, neither Borrower,
nor any partner of Borrower, nor any partner, stockholder,
director or officer of any partner of Borrower, shall be
personally liable for the repayment of any of the principal of,
interest on, or prepayment fees (including yield maintenance
premiums) or late charges, or other charges or fees due in
connection with the Loan, the performance of any covenants of
Borrower under the Note, this Instrument or any of the other
Loan Documents or for any deficiency judgment which Lender may
obtain after default by Borrower. Notwithstanding the foregoing
provisions of this paragraph or any other agreement, the
Borrower shall be fully and personally liable for any and all:
(1) liabilities, costs, losses, damages, expenses or claims
(including, without limitation, any reduction in the value of
the Property or any other items, property or amounts which are

8

 

collateral or security for the Loan) suffered or
incurred by Lender by reason of or in connection with
(a) any fraud or misrepresentation by the Borrower in
connection with the Loan, including but not limited to any
misrepresentation of the Borrower contained in any Loan
Document, (b) any failure to pay taxes, insurance premiums
(except to the extent that such taxes and insurance premiums are
then held by the Lender), assessments, charges for labor or
materials or other charges that can create liens on any portion
of the Property, (c) any misapplication of
(i) proceeds of insurance covering any portion of the
Property, or (ii) proceeds of the sale or condemnation of
any portion of the Property, (d) any rentals, income,
profits, issues and products received by or on behalf of the
Borrower subsequent to the date on which the Lender gives
written notice that a default has occurred under the Loan and
not applied to the payment of principal or interest due under
the Note or the payment of operating expenses (excluding any
operator’s, manager’s or developer’s fee paid to
the Borrower or any affiliate of the Borrower) of the Property,
(e) any failure to maintain, repair or restore the Property
in accordance with any Loan Document to the extent not covered
by insurance proceeds made available to the Lender, (f) any
failure by the Borrower to deliver to the Lender all unearned
advance rentals and security deposits paid by tenants of the
Property received by or on behalf of the Borrower, and not
refunded to or forfeited by such tenants, (g) any failure
by the Borrower to return to, or reimburse the Lender for, all
personalty taken from the Property by or on behalf of the
Borrower, except in accordance with the provisions of this
Instrument, and (h) any and all indemnities given by the
Borrower to the Lender set forth in the Environmental Indemnity
Agreement or any other Loan Document in connection with any
environmental matter relating to the Property; and
(2) court costs and all attorneys’ fees provided for
in any Loan Document incurred in connection with the enforcement
of the Loan. Furthermore, no limitation of liability or recourse
provided above in this paragraph shall (x) apply to the
extent that the Lender’s rights of recourse to the Property
are suspended, reduced or impaired by or as a result of any act,
omission or misrepresentation of the Borrower or any other party
now or hereafter liable for any part of the Loan and accrued
interest thereon, or by or as a result of any case, action, suit
or proceeding to which the Borrower or any such other party,
voluntarily becomes a party; or (y) constitute a waiver,
forfeiture, abrogation or limitation of or on any right accorded
by any law establishing a debtor relief proceeding, including,
but not limited to, Title 11, U.S. Code, which right
provides for the assertion in such debtor relief proceeding of a
deficiency arising by reason of the insufficiency of collateral
notwithstanding an agreement of the Lender not to assert such
deficiency.

 

		
	31.	
    REPRESENTATIONS OF BORROWER. The Borrower hereby
    represents and warrants to Lender the following:
    

    
(a) Borrower is a limited liability company
duly organized, validly existing and in good standing under the
laws of the State of Virginia. There are no proceedings or
actions pending, threatened or contemplated for the liquidation,
termination or dissolution of Borrower.

    
(b) Attached to that certain Rent Schedule
Certification (herein so called) dated 1/14/98 is a true,
correct, and complete list of each and every lease affecting the
Property, together with all extensions and amendments thereof
(the “Existing Leases”); Borrower has delivered to
Lender a true, correct, and complete copy of each of the
Existing Leases; and there are no other leases, assignments,
modifications, extensions, renewals, or other agreements of any
kind whatsoever (written or oral) outstanding with respect to
the leases or the Property.

    
(c) Unless otherwise specified in the Rent
Schedule Certification;

			
	 	(i)	
    the Existing Leases are in full force and effect;
    

			
	 	(ii) 	
    Borrower has not given any notice of default to
    any tenant under an Existing Lease (an “Existing
    Tenant”) which remains uninsured;
    

			
	 	(iii) 	
    no Existing Tenant has any set off, claim or
    defense to the enforcement of any Existing Lease;
    

			
	 	(iv) 	
    no Existing Tenant is in arrears in the payment
    of rent, additional rent or any other charges whatsoever due
    under any Existing Lease; or, to the knowledge of Borrower, is
    materially in default in the performance of any other
    obligations of such Existing Tenant under the applicable
    Existing Lease; and
    

			
	 	(v) 	
    Borrower has completed all work or alterations
    required of the landlord or lessor under each Existing Lease;
    and all of the other obligations of landlord or lessor under the
    Existing Leases have been performed.
    

    
(d) Borrower has delivered to Lender a true,
correct, and complete rent roll (the “Rent Roll”) of
annual and monthly rents payable by all Existing Tenants,
including all percentage rents, if any, expiration dates of the
Existing Leases, and the amount of security deposit being held
by Borrower under each Existing Lease, if any; and Borrower has
not granted any Existing Tenant any rent concessions (whether in
form of cash contributions, work agreements, assumption of an
Existing Tenant’s other obligations, or otherwise) or
extensions of time whatsoever not reflected in such Rent Roll.

    
(e) There are no legal proceedings commenced
(or, to the best of the knowledge of the Borrower, threatened)
against Borrower by any Existing Tenant; no rental in excess of
one month’s rent has been prepaid under any of the Existing
Leases; each of the Leases is valid and binding on the parties
thereto in accordance with its terms; and the execution of this
Instrument and the other Loan Documents will not constitute an
event of default under any of the Existing Leases.

    
(f) Borrower currently holds the security
deposits (if any) specified in the Existing Leases and has not
given any credit, refund, or set off against such security
deposits to any person.

    
(g) There are no residential units in the
Property, and no portion of the Property is an apartment or
other unit subject to any form or rent control, stabilization or
regulation; and no person presently occupies any part of the
Property for dwelling purposes.

    
(h) Except for Borrower, there are no
persons or entities occupying space in the Property as tenants
other than the persons or entities specifically named in the
Existing Leases.

    
(i) Except as specifically listed in the
schedule of exceptions to coverage in the title policy insuring
Lender’s interest in the Property, Borrower is now in
possession of the Property; Borrower’s possession of the
Property is peaceable and undisturbed; Borrower does not know
any facts by reason of which any claim to the Property, or any
part thereof, might arise or be set up adverse to Borrower; and
the Property is free and clear of (i) any lien for taxes
(except real property taxes not yet due and payable for the
calendar year in which this Instrument is being executed), and
(ii) any easements, rights-of-way, restrictions,
encumbrances, liens or other exceptions to title by mortgage,
decree, judgment, agreement, instrument, or, to the knowledge of
Borrower, proceeding in any court.

    
(j) All charges for labor, materials or
other work of any kind furnished in connection with the
construction, improvement, renovation or rehabilitation of the
Property or any portion thereof have been paid in full, and no
unreleased affidavit claiming a lien against the Property, or
any portion thereof, for the supplying of labor, materials or
services for the construction

9

 

of improvements on the Property has been executed
or recorded in the mechanic’s lien or other appropriate
records in the county in which the Property is located.

    
(k) The Property and the current and
contemplated uses of the Property are in compliance with all
applicable federal, state and municipal laws, rules, regulations
and ordinances, applicable restrictions, zoning ordinances,
building codes and regulations, building lines and easements,
including, without limitation, federal and state environmental
protection law and the Americans with Disabilities Act of 1990,
the Fair Housing Amendments Act of 1988, all state and local
laws or ordinances related to handicapped access, and any
statute, rule, regulation, ordinance, or order of governmental
bodies or regulatory agencies, or any order or decree of any
court adopted or enacted with respect thereto (collectively,
“Applicable Laws”): no governmental authority having
jurisdiction over any aspect of the Property has made a claim or
determination that there is any such violation; the Property is
not included in any area identified by the Secretary of Housing
and Urban Development pursuant to the Flood Disaster Protection
Act of 1973, as amended, as an area having special flood
hazards; and all permits, licenses and the like which are
necessary for the operation of the Property have been issued and
are in full force and effect.

    
(l) There have been no material adverse
changes, financial or otherwise, in the condition of Borrower
from that disclosed to Lender in the loan application submitted
to Lender by Borrower, or in any supporting data submitted in
connection with the Loan, and all of the information contained
therein was true and correct when submitted and is now
substantially and materially true and correct on the date hereof.

    
(m) There is no claim, litigation or
condemnation proceeding pending, or, to the knowledge of the
Borrower, threatened, against the Property or Borrower, which
would affect the Property or Borrower’s ability to perform
its obligations in the connection with the Loan.

    
(n) Borrower does not own any real property
or assets other than the Property and does not operate any
business other than the management and operation of the Property.

    
(o) No proceedings in bankruptcy or
insolvency has ever been instituted by or against Borrower or
any affiliate thereof, and no such proceeding is now pending or
contemplated.

    
(p) Borrower is, and if there are any
general partners or members of Borrower, such partners or
members are, solvent pursuant to the laws of the United States,
as reflected by the entries in Borrower’s books and records
and as reflected by the actual facts.

    
(q) The Loan Documents have been duly
authorized, executed and delivered by Borrower and constitute
valid and binding obligations of Borrower, enforceable against
Borrower in accordance with their respective terms. No approval,
consent, order or authorization of any governmental authority
and no designation, registration, declaration or filing with any
governmental authority is required in connection with the
execution and delivery of the Note, this Instrument or any other
Loan Document.

    
(r) The execution and delivery of the Loan
Documents will not violate or contravene in any way the articles
of incorporation or bylaws or partnership agreement, articles of
organization or operating agreement as the case may be, of
Borrower or any indenture, agreement or instrument to which
Borrower is a party or by which it or its property may be bound,
or be in conflict with, result in a breach of or constitute a
default under any such indenture, agreement or other instrument,
result in the creation or imposition of any lien, charge or
encumbrance of any nature whatsoever upon any of the property or
assets of Borrower, except as contemplated by the provisions of
such Loan Documents, and no action or approval with respect
thereto by any third person is required.

    
(s) No part of the Property is all or a part
of Borrower’s homestead.

    
(t) The Property is served by all utilities
required for the current or contemplated use thereof. All
utility service is provided by public utilities and the Property
has accepted or is equipped to accept such utility service.

    
(u) All public roads and streets necessary
for service of and access to the Property for the current or
contemplated use thereof have been completed, are serviceable
and all-weather and are physically and legally open for use by
the public.

    
(v) The Property is serviced by public water
and sewer systems.

    
(w) The Property is free from damage cause
by fire or other casualty.

    
(x) All liquid and solid waste disposal,
septic and sewer systems located on the Property are in a good
and safe condition and repair and in compliance with all
Applicable Laws.

32.    BORROWER’S
ADDITIONAL COVENANTS. Borrower hereby covenants, agrees and
undertakes to:

    
(a) fulfill and perform all of
Borrower’s obligations as landlord or lessor under any
lease; will promptly send Lender copies of any notices of
default received from the tenant under any lease; and will
enforce (short of terminating such lease) the performance by the
tenant of the tenant’s obligations under any lease;

    
(b) not make, enter into, execute, cancel,
amend or modify any lease without the prior written consent of
Lender (other than an Exempt Lease);

    
(c) not approve any assignment of a lease,
of any sublease or underlease, without the prior written consent
of Lender (other than an Exempt Lease);

    
(d) not cancel or modify any guaranty of a
lease, or release any security deposit or letter of credit
constituting security under a lease, without the prior written
consent of Lender;

    
(e) not accept prepayment of any installment
of rent from any tenants of the Property for a period of more
than one (1) month in advance;

    
(f) not further assign the whole (or any
part of) the leases or the rents;

    
(g) not undertake or commence any
alterations of any improvements on the Property the cost of
which is in excess of five percent (5%) of the then original
principal amount of the Note, without the prior written consent
of Lender;

10

 

    
(h) from time to time, at the request of
Lender, (i) promptly correct any defect, error or omission
which may be discovered in the contents of this Instrument or in
any other Loan Document or in the execution or acknowledgement
thereof; (ii) execute, acknowledge, deliver and record
and/or file such further documents or instruments (including,
without limitation, further mortgages, security agreements,
financing statements, continuation statements, assignments of
rents or leases and environmental indemnity agreements) and
perform such further acts and provide such further assurances as
may be necessary, desirable or proper, in Lender’s opinion,
to carry out more effectively the purposes of this Instrument
and such other instruments and to subject to the liens and
security interests hereof and thereof any property intended by
the terms hereof or thereof to be covered hereby or thereby,
including specifically, but without limitation, any renewals,
additions, substitutions, replacements, or appurtenances to the
Property; provided that such documents or instruments do not
materially increase Borrower’s liability under the Loan
Documents; and (iii) execute, acknowledge, deliver,
procure, and file and/or record any document or instrument
(including specifically, but without limitation, any financing
statement) deemed advisable by Lender to protect the liens and
the security interests herein granted against the rights or
interests of third persons; provided that such documents or
instruments do not materially increase Borrower’s liability
under the Loan Documents. Borrower will pay all reasonable costs
connected with any of the foregoing in this
subparagraph (h);

    
(i) continuously maintain Borrower’s
existence and right to do business in the State of Virginia;

    
(j) at any time any law shall be enacted
imposing or authorizing the imposition of any tax upon this
Instrument, or upon any rights, titles, liens or security
interests created hereby, or upon the obligations secured hereby
or any part thereof, immediately pay all such taxes; provided
that, if such law as enacted makes it unlawful for Borrower to
pay such tax, Borrower shall not pay nor be obligated to pay
such tax, and in the alternative, Borrower may, in the event of
the enactment of such a law, and must, if it is unlawful for
Borrower to pay such taxes, prepay the obligations secured
hereby in full within sixty (60) days after demand therefor by
Lender;

    
(k) not execute or deliver any deed of
trust, mortgage or pledge of any type covering all or any
portion of the Property;

    
(l) not acquire any real property or assets
(other than the Property) or operate any business other than the
management and operation of the Property during the term of the
Loan;

    
(m) not permit any drilling or exploration
for or extraction, removal or production of any mineral, natural
element, compound or substance from the surface of subsurface of
the Property regardless of the depth thereof or the method of
mining or extraction thereof;

    
(n) not change its name, identity, structure
or employer identification number during the term of the Loan;

    
(o) pay on demand all reasonable and bona
fide out-of-pocket costs, fees and expenses and other
expenditures, including, but not limited to, reasonable
attorneys’ fees and expenses, paid or incurred by Lender to
third parties incident to this Instrument or any other Loan
Document (including, but not limited to, reasonable
attorneys’ fees and expenses in connection with the
negotiation, preparation and execution hereof and of any other
Loan Document and any amendment hereto or thereto, any release
hereof, any consent, approval or waiver hereunder or under any
other Loan Document, the making of any advance under the Note,
and any suit to which Lender is a party involving this
Instrument or the Property) or incident to the enforcement of
the obligations secured hereby or the exercise of any right or
remedy of Lender under any Loan Document; and

    
(p) maintain and keep the Property in
compliance with all Applicable Laws.

33.    RESERVES.

    
(a) CAPITAL IMPROVEMENTS RESERVE.

		
	 	    
    (i) Commencing on the first day a monthly
    installment of principal and interest is due and payable under
    the Note and continuing on the first calendar day of each
    calendar month thereafter, Borrower shall deliver to Lender,
    together with the regular installments of principal and interest
    an amount (a “CIR Payment”) equal to $565.34. Each CIR
    Payment shall be deemed “Other Impositions” and
    “Funds” as defined in paragraph 2 of this Instrument.
    The CIR Payments will be placed in interest bearing deposits or
    accounts in the name of Lender or Lender’s loan servicer at
    the same financial institution(s) as the other Funds (the
    “Other Impositions Account”), shall be held in
    accordance with the terms of paragraph 2 of this
    Instrument, and may be drawn on by Borrower for deferred
    maintenance and/or ongoing capital improvement expenditures in
    connection with the Property, pursuant to the terms set forth
    below in subparagraph 33(a)(ii). At Lender’s
    discretion, the CIR Payments may be increased to reflect any
    increase in the “Consumer Price Index” published by
    the Bureau of Labor Statistics of the U.S. Department of
    Labor. All items, U.S. city average, all urban consumers
    (presently denominated “CPI-U”), or a successor or
    substitute index appropriately adjusted (the “CPI”).
    In the event Lender shall elect not to increase the CIR Payment
    for any given year by the CPI, Lender, at its sole discretion,
    may during any subsequent year elect to increase the CIR Payment
    by the aggregate amount of CPI increases which Lender otherwise
    was entitled to make during the previous years in which it did
    not elect to make such increases.
    
	 
	 	    
    (ii) So long as Borrower (x) is not in
    default under any of the terms of the Note, this Instrument or
    any of the other Loan Documents, and (y) no situation
    exists which with the passage of time or the giving of notice or
    both would constitute a default under the Note, this Instrument
    or any of the other Loan Documents, Borrower, subject to the
    following provisions of this subparagraph (ii) and upon ten
    (10) days’ prior written notice to Lender and
    Lender’s loan servicer (which notice shall include a brief
    statement of the purpose for which the advance is to be used),
    shall be entitled to draw on the CIR Payments on deposit in the
    Other Impositions Account solely for the payment of deferred
    maintenance and/or ongoing capital improvement expenditures for
    the Property. Borrower may not make any drawing on the Other
    Impositions Account (1) for less than $500 and
    (2) without the prior consent of Lender. Lender reserves
    the right to require such information as Lender may reasonably
    require, and to withhold consent in the event that Lender deems
    its necessary to do so. Without limiting the foregoing, Lender
    may request, in connection with a request by Borrower for a
    drawing on the Other Impositions Account, that Borrower furnish
    written evidence reasonably satisfactory to Lender that the
    amount requested by Borrower is for work performed, services or
    materials furnished, and bills paid or payable with respect to
    the deferred maintenance and/or ongoing capital improvement
    expenditures (including, but not limited to, contracts and
    invoices for work performed or materials supplied and
    mechanics’ and materialmen’ lien releases and waivers
    from such parties performing such work or supplying such
    materials). Lender also reserves the right to make any
    disbursement or portion thereof from the Other Impositions
    Account directly to the party performing such work or supplying
    such materials. Lender or Lender’s servicing agent, as the
    case may be, shall be entitled to charge Borrower a reasonable
    processing fee for administering and reviewing Borrower’s
    draw requests. In addition, Lender shall be reimbursed by
    Borrower for any costs incurred by Lender or Lender’s
    servicing agent in inspecting the Property in connection with
    Borrower’s draw requests. Any such processing fees and
    inspection costs shall be deducted by Lender from the Funds on
    deposit or account or, at Lender’s option, shall be paid to
    Lender by Borrower within ten (10) days of Lender’s
    written demand.
    

11

 

         
(iii) Each CIR Payment is pledged as
additional security for the sums secured by this Instrument and
any of the other Loan Documents. Borrower hereby grants to
Lender a lien and security interest in each CIR Payment and the
deposit or other accounts in which such payments are placed.

    
(b) TENANT IMPROVEMENTS/LEASING
COMMISSION RESERVE.

         
(i) Commencing on the first day a monthly
installment of principal and interest is due and payable under
the Note and continuing on the first calendar day of each
calendar month thereafter, Borrower shall deliver to Lender,
together with the regular installments of principal and interest
an amount (a “TI/LC Payment”) equal to $1,643.00. Each
TI/LC Payment shall be deemed “Other Impositions” and
“Funds” as defined in paragraph 2 of this
Instrument. The TI/LC Payments will be placed in the Other
Impositions Account, shall be held in accordance with the terms
of paragraph 2 of this Instrument, and may be drawn
on by Borrower for tenant improvement and/or leasing commission
expenditures in connection with the Property, pursuant to the
terms set forth below in subparagraph 33(b)(ii).
Interest earned on the Funds on deposit in the Other Impositions
Account shall be credited to the Other Impositions Account. At
Lender’s discretion, the TI/LC Payments may be increased to
reflect any increase in the “Consumer Price Index”
published by the Bureau of Labor Statistics of the
U.S. Department of Labor, All Items, U.S. city
average, all urban consumers (presently denominated
“CPI-U”), or a successor or substitute index
appropriately adjusted (the “CPI”). In the event
Lender shall elect not to increase the TI/LC Payment for any
given year by the CPI, Lender, at its sole discretion, may
during any subsequent year elect to increase the TI/LC Payment
by the aggregate amount of CPI increases which Lender otherwise
was entitled to make during the previous years in which it did
not elect to make such increases.

         
(ii) So long as Borrower (x) is not in
default under any of the terms of the Note, this Instrument or
any of the other Loan Documents, and (y) no situation
exists which with the passage of time or the giving of notice or
both would constitute a default under the Note, this Instrument
or any of the other Loan Documents, Borrower, subject to the
following provisions of this subparagraph (ii) and
upon ten (10) days’ prior written notice to Lender and
Lender’s loan servicer (which notice shall include a brief
statement of the purpose for which the advance is to be used),
shall be entitled to draw on the TI/LC Payments on deposit in
the Other Impositions Account solely for the payment of tenant
improvement and/or commissions incurred in connection with the
leasing and/or releasing of any tenant space at the Property.
Borrower may not make any drawing on the Other Impositions
Account (1) for less than $500 and (2) without the
prior consent of Lender. Lender reserves the right to require
such information as Lender may reasonably require, and to
withhold consent in the event that Lender deems it necessary to
do so. Without limiting the foregoing, Lender may request, in
connection with a request by Borrower for a drawing on the Other
Impositions Account, that Borrower furnish written evidence
reasonably satisfactory to Lender that the amount requested by
Borrower is for work performed, services or materials furnished,
and bills paid or payable with respect to such tenant
improvements and/or commissions (including, but not limited to,
contracts and invoices for work performed or materials supplied
and mechanics’ and materialmen’ lien releases and
waivers from such parties performing such work or supplying such
materials). Lender also reserves the right to make any
disbursement or portion thereof from the Other Impositions
Account directly to the party performing such work or supplying
such materials. Lender or Lender’s servicing agent, as the
case may be, shall be entitled to charge Borrower a reasonable
processing fee for administering and reviewing Borrower’s
draw requests. In addition, Lender shall be reimbursed by
Borrower for any costs incurred by Lender or Lender’s
servicing agent in inspecting the Property in connection with
Borrower’s draw requests. Any such processing fees and
inspection costs shall be deducted by Lender from the Funds on
deposit or account or, at Lender’s option, shall be paid to
Lender by Borrower within ten (10) days of Lender’s
written demand.

         
(iii) Each TI/LC Payment is pledged as
additional security for the sums secured by this Instrument and
any of the other Loan Documents. Borrower hereby grants to
Lender a lien and security interest in each TI/LC Payment and
the deposit or other accounts in which such payments are placed.

    
(c) DEFERRED MAINTENANCE ESCROW.

         
(i) On the date hereof, Borrower shall
deliver to Lender an amount (the “Deferred Maintenance
Escrow”) equal to $625. The Deferred Maintenance Escrow
shall be deemed “Other Impositions” and
“Funds” as defined in paragraph 2 of this
Instrument. The Deferred Maintenance Escrow will be placed in
the Other Impositions Account, shall be held in accordance with
the terms of paragraph 2 of this Instrument, and may
be drawn on by Borrower for expenditures in connection with
paving, striping and walkway patching work on the Property as
set forth in that certain [ENGINEERING REPORT] (the
“Engineering Report Repairs”), pursuant to the terms
set forth below in subparagraph 33(c)(ii). Interest
earned on the Funds on deposit in the Other Impositions Account
shall be credited to the Other Impositions Account.

         
(ii) So long as Borrower (x) is not in
default under any of the terms of the Note, this Instrument or
any of the other Loan Documents, and (y) no situation
exists which with the passage of time or the giving of notice or
both would constitute a default under the Note, this Instrument
or any of the other Loan Documents, Borrower, subject to the
following provisions of this subparagraph (ii) and
upon ten (10) days’ prior written notice to Lender and
Lender’s loan servicer (which notice shall include a brief
statement of the purpose for which the advance is to be used),
shall be entitled to draw on the Deferred Maintenance Escrow on
deposit in the Other Impositions Account solely for the payment
of the expense of performing the Engineering Report Repairs.
Borrower may not make any drawing on the Other Impositions
Account (1) for less than $500 and (2) without the
prior consent of Lender. Lender reserves the right to require
such information as Lender may reasonably require, and to
withhold consent in the event that Lender deems it necessary to
do so. Without limiting the foregoing, Lender may request, in
connection with a request by Borrower for a drawing on the Other
Impositions Account, that Borrower furnish written evidence
reasonably satisfactory to Lender that the amount requested by
Borrower is for work performed, services or materials furnished,
and bills paid or payable with respect to such Engineering
Report Repairs (including, but not limited to, contracts and
invoices for work performed or materials supplied and
mechanics’ and materialmen’s lien releases and waivers
from such parties performing such work or supplying such
materials). Lender also reserves the right to make any
disbursement or portion thereof from the Other Impositions
Account directly to the party performing such work or supplying
such materials. Lender or Lender’s servicing agent, as the
case may be, shall be entitled to charge Borrower a reasonable
processing fee for administering and reviewing Borrower’s
draw requests. In addition, Lender shall be reimbursed by
Borrower for any costs incurred by Lender or Lender’s
servicing agent in inspecting the Property in connection with
Borrower’s draw requests. Any such processing fees and
inspection costs shall be deducted by Lender from the Funds on
deposit or account or, at Lender’s option, shall be paid to
Lender by Borrower within ten (10) days of Lender’s
written demand.

         
(iii) The Deferred Maintenance Escrow is
pledged as additional security for the sums secured by this
Instrument and any of the other Loan Documents. Borrower hereby
grants to Lender a lien and security interest in the Deferred
Maintenance Escrow and the deposit or other accounts in which
such payments are placed.

34. FORECLOSURE.
If Lender invokes the power of sale, Lender or Trustee shall
give to Borrower a copy of a notice of sale in the manner
prescribed by applicable law. Trustee shall give public notice
of sale in the manner prescribed by applicable law and shall
sell the Property in accordance with the laws of Virginia.
Trustee, without demand on Borrower, shall sell the Property at
public auction to the highest bidder at the time and place and
under the terms designated in the notice of sale in one or more
parcels and in such order as Trustee may determine. Trustee may
postpone sale of all or any parcel of the Property by public

12

 

announcement at the time and place of any
previously scheduled sale or by advertising in accordance with
applicable law. Lender or Lender’s designee may purchase
the Property at any sale or by advertising in accordance with
applicable law.

35.    ASSUMABILITY.

    
(a) So long as (i) Borrower is not in
default under any of the terms of the Note, this Instrument or
any other Loan Document, and (ii) no situation exists which
with the passage of time or the giving of notice or both would
constitute a default under the Note, this Instrument or any
other Loan Document, in the event Borrower desires to transfer
all of the Property to another party (the
“Transferee”) and have the Transferee assume all of
Borrower’s obligations under the Note, this Instrument and
all of the other Loan Documents (collectively, the
“Transfer and Assumption”), Borrower, subject to the
terms of this paragraph, may make a written application to
Lender for Lender’s consent to the Transfer and Assumption,
subject to the conditions set forth in subparagraph (b) of
this paragraph 35. Together with such written application (and
afterwards if requested by Lender), Borrower will submit to
Lender true, correct and complete copies of any and all
information and documents of any kind requested by Lender
concerning the Property, Transferee and/or Borrower, together
with any review fee required by Lender, in Lender’s sole
discretion.

    
(b) Lender shall not unreasonably withhold
its consent to a Transfer and Assumption provided and upon the
condition that:

			
	 	(i)	
    Lender receives an opinion from counsel
    acceptable to Lender that (x) such Transfer and Assumption
    shall not affect, in any way, the enforceability of the Loan
    Documents or the lien status, and (y) that the Transferee
    complies in all respects with the provisions of paragraph 31(n)
    and paragraph 32(l) of this Instrument and such other conditions
    concerning the organization structure of the Transferee as were
    required by Lender at the time of the making of the Loan;
    
	 
	 	(ii)	
    Borrower has submitted to Lender true, correct
    and complete copies of any and all information and documents of
    any kind requested by Lender concerning the Property, Transferee
    and/or Borrower;
    
	 
	 	(iii)	
    the Transferee, in Lender’s sole judgment,
    has sufficient experience in managing assets similar in size and
    type to the Property;
    
	 
	 	(iv)	
    in Lender’s sole judgment, the Transferee
    and the partners, members or shareholders of the Transferee are
    financially sound or have sufficient financial resources to
    manage the Property for the term of the Loan;
    
	 
	 	(v)	
    the Loan has been placed, or Lender plans to
    place the Loan, in an offering of Securities (as defined in
    paragraph 37) and Lender receives written confirmation from
    the rating agencies that the Transfer and Assumption will not
    result in any downgrade, qualification or withdrawal of the
    ratings assigned to the pool and assets in which the Loan has
    been placed; and
    
	 
	 	(vi)	
    Borrower has paid any review fee required by
    Lender.
    

    
(c) if Lender consents to the Transfer and
Assumption, the Transferee and/or Borrower as the case may be,
shall deliver the following to Lender:

			
	 	(i)	
    Borrower shall deliver to Lender an assumption
    fee in the amount of one percent (1%) of the then unpaid
    principal balance of the Loan;
    
	 
	 	(ii)	
    Borrower and Transferee shall execute and deliver
    to Lender any and all documents required by Lender, in form and
    substance required by Lender, in Lender’s sole discretion
    (the “Assumption Documents”);
    
	 
	 	(iii)	
    Borrower shall cause to be delivered to Lender,
    an endorsement to the mortgagee policy of title insurance then
    insuring the lien created by this Instrument in form and
    substance acceptable to Lender, in Lender’s sole discretion
    (the “Endorsement”); and
    
	 
	 	(iv)	
    Borrower shall deliver to Lender a payment in the
    amount of all costs incurred by Lender in connection with the
    Transfer and Assumption, including but not limited to,
    Lender’s attorneys fees and expenses, all recording fees
    for the Assumption Documents, and all fees payable to the title
    company for the delivery to Lender of the Endorsement.
    

    
(d) Notwithstanding anything contained in
this paragraph to the contrary, (x) under no circumstances
may the Property and Loan be transferred and assumed by any
party under the terms of this paragraph more than once during
the entire term of the Loan and (y) except based on
Lender’s written agreement to the Transfer and Assumption
and Borrower’s and Transferee’s compliance with all of
the terms and provisions of this paragraph, the terms and
provisions of this paragraph shall in no way amend or modify the
terms and provisions contained in paragraph 19 of this
Instrument.

36.    WAIVER OF JURY TRIAL.
BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES
ANY RIGHT THE BORROWER MAY HAVE TO A TRIAL BY JURY IN RESPECT TO
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN
CONJUNCTION WITH THE NOTE, THIS INSTRUMENT, ANY OTHER LOAN
DOCUMENT, ANY OTHER AGREEMENT CONTEMPLATED TO BE EXECUTED IN
CONNECTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
EITHER PARTY.

37.    TRANSFER OF LOAN.
Lender may, at any time, sell, transfer or assign the Note, this
Instrument and the Loan Documents, or any part thereof, and any
or all servicing rights with respect thereto, or grant
participations therein or issue mortgage pass-through
certificates or other securities evidencing a beneficial
interest in a rated or unrated public offering or private
placement (the “Securities”). Lender may forward to
each purchaser, transferee, assignee, servicer, participant,
investor in such Securities or any rating agency rating such
Securities (singularly, an“Investor,” and
collectively, the “Investors”) and each prospective
Investor, all documents and information which Lender now has or
may hereafter acquire relating to the Loan and to Borrower, any
guarantor, any indemnitors and/or the Property, whether
furnished by Borrower, any guarantor, any indemnitors or
otherwise, as Lender determines necessary or desirable. Borrower
shall furnish and Borrower consents to Lender furnishing to such
Investors or such prospective Investors or rating agency any and
all information concerning the Property, the

13

 

leases, the financial condition of Borrower, any
guarantor and any indemnitor as may be requested by Lender, any
Investor or any prospective Investor or rating agency in
connection with any sale, transfer or participation interest.

38.     IDENTIFICATION
OF NOTE. The Note is identified by a certificate on the Note
executed by any Notary Public who certifies an acknowledgment
hereto.

39.     FUTURE ADVANCES.
Upon request of Borrower, Lender, at Lender’s option so
long as this Instrument secures indebtedness held by Lender, may
make Future Advances to Borrower. Such Future Advances, with
interest thereon, shall be secured by this Instrument when
evidenced by promissory notes stating that said notes are
secured hereby. At no time shall the principal amount of the
indebtedness secured by this Instrument, not including sums
advanced in accordance herewith to protect the security of this
Instrument, exceed the original amount of the Note
(US $1,500,000.00) plus the additional sum of US $0.

     
This Instrument may be executed in any number of
duplicate originals and each duplicate original shall be deemed
to be an original.

     
IN WITNESS WHEREOF, Borrower has executed this
Instrument or has caused the same to be executed by its
representatives thereunto duly authorized.

AQUIA COMMERCE CENTER, L.C.,

a Virginia limited liability company

		
	By: 	
    Andrew S. Garrett, Inc.
    

a Virginia corporation, a

managing member, its authorized signatory

(Seal)          

			
	By: 	
    /s/ ANDREW S. GARRETT
    	 

		
	
    
	 
	
    Name:
    	 
	
    Title:
    	 

		
	 	
    Borrower’s Address:
	 
	 	
    Aquia Commerce Center
    
	 	
    2721 Jefferson Davis Highway
    
	 	
    Stafford, VA 22554
    

14

 

LIMITED LIABILITY COMPANY
ACKNOWLEDGMENT

COMMONWEALTH OF VIRGINIA, Prince William County
ss:

     
The foregoing instrument was acknowledged before
me this January 9, 1998 by Andrew S. Garrett, the President
of Andrew S. Garrett, Inc., a Virginia corporation, a managing
member of Aquia Commerce Center, L.C., a Virginia limited
liability company, on behalf of said corporation acting on
behalf of said limited liability company.

My Commission Expires:

11-30-2000

		
	 	
    /s/ CYNTHIA M. YEARS
    
	 	
    

	 	
    Notary Public
    

15exv10w34

 

Exhibit 10.34

AMENDED AND RESTATED PROMISSORY NOTE SECURED BY DEED OF TRUST

	 	 	 
	$7,597,441

	 	August 28, 1998

          For value received, BUTERA PROPERTIES, LLC, a Delaware limited
liability company (hereinafter referred to as “Maker”), promises to pay
to the order of CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC, a
Delaware limited liability company (“Lender” and also sometimes
“Payee”), having its principal office at 11 Madison Avenue, New York,
New York 10010, or at such place as the holder hereof may from time to
time designate in writing, the principal sum of SEVEN MILLION FIVE
HUNDRED NINETY-SEVEN THOUSAND FOUR HUNDRED FORTY-ONE DOLLARS
($7,597,441), in lawful money of the United States of America, with
interest thereon to be computed on the unpaid principal balance from
time to time outstanding at the Applicable Interest Rate (as
hereinafter defined), and to be paid in installments as follows:

	A.	 	A payment of interest only on the date hereof with
respect to the interest
accrual period from the date hereof to and including
September 10 1998;
	 
	B.	 	A constant payment of $49,075.02 (such amount
hereinafter the
“Wedgewood Monthly Payment Amount”), on the eleventh day of
October, 1998 and on the eleventh day of each calendar month thereafter
up to and including the eleventh day of September, 2028; (each a
“Payment Date”); each of such payments to be applied
(a) to the payment of interest computed at the Initial
Term Interest Rate (as hereinafter defined); and (b)
the balance applied toward the reduction of the
principal sum;

and the balance of said principal sum together with all accrued and
unpaid interest thereon shall be due and payable on the eleventh day of
September, 2028 (the “Maturity Date”). Interest on the principal sum of
this Note shall be calculated on the basis of the actual number of days
elapsed and a three-hundred-sixty (360) day year. The constant payment
required hereunder is based on an amortization schedule of
three-hundred-sixty (360) months. For purposes of making payments
hereunder, but not for purposes of calculating interest accrual
periods, if the eleventh (11th) day of a given month is not a Business
Day (as hereinafter defined), then amounts due on the Payment Date for
such month shall be due on the next succeeding Business Day. All
amounts due under this Note shall be payable without setoff,
counterclaim or any other deduction whatsoever.

          1. As used in this Note:

          (a) The term “Annual Budget” shall mean an annual budget
submitted by Maker to Payee in accordance with the terms of paragraph
8(b) herein.

 

 

          (b) The
term “Anticipated Repayment Date” shall mean
September 11, 2008.

          (c) The term “Applicable Interest Rate” shall mean from (i) the date of
this Note through but not including the Anticipated Repayment Date, the
Initial Term Interest
Rate, and (ii) from and after the Anticipated Repayment Date through and
including the date
this Note is paid in full, the Extended Term Rate.

          (d) The term “Approved Annual Budget” shall mean each Annual Budget
approved by Payee in accordance with terms herein.

          (e) The term “Business Day” shall mean a day other than (i) a Saturday or
Sunday, or (ii) any day on which commercial banks in New York City are not
open for
general banking business.

          (f) The term “Capital Expenditures” shall mean for any period, the amount
expended for items capitalized under generally accepted accounting principles
including expenditures for building improvements or major repairs, leasing
commissions and tenant improvements.

          (g) The term “Cash Expenses” shall mean, collectively, the Consolidated
Cash Expenses and the Wedgewood Cash Expenses.

          (h) The term “Cash Management Agreement” shall have the meaning assigned
to such term in the Deeds of Trust.

          (i) The
term “Consolidated Borrowers” shall mean, collectively, the Maker
and the following other entities: Butera Properties II, LLC, a Maryland
limited liability company, Butera Gateway Center, LLC, a Maryland limited
liability company, Butera Girard Place, LLC, a Maryland limited liability
company, Butera Girard Business Center, LLC, a Maryland limited liability
company, Butera Goldenrod Lane, LLC, a Maryland limited liability company,
Thirty West LLLP, a Maryland limited liability limited partnership, TRB, Inc.,
a Colorado corporation, and Woodstone Assoc., a Colorado general partnership

          (j) The term “Consolidated Cash Expenses” shall mean for any period, the
operating expenses for the Consolidated Trust Property as set forth in an
Approved Annual Budget to the extent that such expenses are actually incurred
by Consolidated Borrowers minus payments into the Tax and Insurance Impound
Fund and the Replacement Escrow Fund pursuant to the Consolidated Deed of
Trust.

          (k) The term “Consolidated Debt” shall mean, collectively, the whole of
the principal sum of the Consolidated Note, together with all interest accrued
and unpaid thereon and all other sums due under the Consolidated Loan
Documents.

          (1) The term “Consolidated Deed of Trust” shall mean the Amended,
Restated and Consolidated Deed of Trust and Security Agreement of even date
herewith in the

-2-

 

amount of this Note and the Consolidated Note, given by Consolidated Borrowers
for the use and benefit of Payee covering the fee estate of Consolidated
Borrowers in certain premises as more particularly described therein.

          (m) The term “Consolidated Loan” shall mean that certain loan in the
principal amount of the Consolidated Note made by Payee to Maker
contemporaneously herewith.

          (n) The term “Consolidated Loan Documents” shall mean collectively the
Consolidated Note, the Consolidated Deed of Trust, the Wedgewood Deed of Trust
and any and all other documents securing, evidencing, or guaranteeing all or
any portion of the Consolidated Loan or otherwise executed and/or delivered in
connection with the Consolidated Note and the Consolidated Loan.

          (o) The term “Consolidated Monthly Payment Amount” shall mean the Monthly
Payment Amount specified under the Consolidated Note.

          (p) The term “Consolidated Note” shall mean the Promissory Note Secured
by Deed of Trust of even date herewith from the Consolidated Borrower to the
Payee in the principal amount of $75,402,559

          (q) The term “Consolidated Trust Property” shall mean the property
covered by the Consolidated Deed of Trust.

          (r) The term “Debt” shall mean, collectively, the Consolidated Debt and
the Wedgewood Debt.

          (s) The term “Deeds of Trust” shall mean, collectively, the Consolidated
Deed of Trust and the Wedgewood Deed of Trust.

          (t) The term “Default Rate” shall mean, a rate per annum which equal to
the lesser of (a) the maximum rate permitted by applicable law, or (b) five
percent (5%) above the Applicable Interest Rate.

          (u) The term “Defeasance Option” shall mean the right and option of Maker
to release the Trust Property (as defined in each Deed of Trust) from the lien
of such Deed of Trust in accordance with the provisions set forth in Section
4.37 of each Deed of
Trust.

          (v) The term “Extended Term Rate” shall mean a rate per annum equal to
(i) a rate per annum equal to the greater of (A) the Initial Term Interest
Rate plus five (5) percentage points or (B) the Treasury Rate plus five (5)
percentage points, or (ii) for so long as this Note is an asset of the trust,
partnership, corporation or other entity formed in connection with a
Securitization (as defined in the Wedgewood Deed of Trust) pursuant to which
securities rated by any Rating Agency (as defined in the Wedgewood Deed of
Trust)

-3-

 

have been issued, a rate per annum equal to the Initial Term Interest Rate plus
two (2) percentage points.

          (w) The term “Excess Cash Flow” shall mean, for any period, the sum
(determined in accordance with generally accepted accounting principles,
consistently applied) of (i) net operating income (calculated as all income
derived from the operation of the Trust Property after payment of taxes and
expenses), plus (ii) depreciation and amortization (to the extent deducted in
determining net operating income) for such period, plus (iii) disbursements
from the Tax and Insurance Impound Fund, the Replacement Escrow Fund, the
Leasing Escrow Fund or any other escrows or reserves approved by Payee or
provided for under the Loan Documents, but only to the extent disbursed by
Maker and not applied to the payment of, or reimbursement for, taxes,
insurance and other amounts for which such reserves were set aside, minus (iv)
actual payments of the regularly scheduled principal and interest payments
(calculated at the Applicable Interest Rate, or at the Default Rate, if
applicable) due and payable in accordance with this Note and the Consolidated
Note during an applicable period, minus (v) actual Capital Expenditures in
excess of payments from the Replacement Escrow Fund, the Leasing Escrow Fund
and funding of reserves for working capital and Extraordinary Expenses as
approved by Lender in its sole discretion, and minus (vi) payments into the
Replacement Escrow Fund, the Tax and Insurance Impound Fund, the Leasing
Escrow Fund and other reserves required under the Loan Documents.

          (x) The term “Extraordinary Expense” shall mean an extraordinary
operating expense or capital expense not set forth in the Approved Annual
Budget or allotted for in the Replacement Escrow Fund.

          (y) The term “Initial Term Interest Rate” shall mean a rate of Six and
71/100 percent (6.71%) per annum.

          (z) The term “Loan Documents” means, collectively, the Consolidated Loan
Documents and the Wedgewood Loan Documents.

          (aa) The term “Mezzanine Borrowers” shall mean Butera Equity, LLC and
Kimmel Equity, LLC.

          (bb) The term “Mezzanine Cash Collateral Account” shall mean the account
described in Section 3(b)(vi) of the Cash Management Agreement.

          (cc) The term “Mezzanine Loan” shall mean the loan in the principal
amount of $8,798,160 from the Payee to the Mezzanine Borrowers, and evidenced
by the Mezzanine Note.

          (dd) The term “Mezzanine Monthly Principal Payments” shall mean all
monthly principal payments required to be made under the Mezzanine Note.

-4-

 

          (ee) The term “Net Capital Expenditures” shall mean for any period
the amount by which Capital Expenditures during such period exceeds
reimbursements for such items during such period from any fund
established pursuant to the Loan Documents.

          (ff) The term “Sale” shall have the meaning given such term in the
Deeds of Trust.

          (gg) The terms “Tax and Insurance Impound Fund”, “Leasing Escrow
Fund” and “Replacement Escrow Fund” shall have the meanings given such
terms in the Consolidated Deed of Trust and the Wedgewood Deed of
Trust, respectively.

          (hh) The
term “Treasury Rate” shall mean, as of the Anticipated
Repayment Date, the yield, calculated by linear interpolation (rounded
to the nearest one-thousandth of one percent (i.e., 0.001%)) of the
yields of noncallable United States Treasury obligations with terms
(one longer and one shorter) most nearly approximating the period from
the Anticipated Repayment Date to the Maturity Date, as determined by
Payee on the basis of Federal Reserve Statistical Release H.15-Selected
Interest Rates under the heading U.S. Governmental Security/Treasury
Constant Maturities, or other recognized source of financial market
information selected by Payee.

          (ii) The term “Trust Property” shall mean, collectively, the
Consolidated Trust Property and the Wedgewood Trust Property.

          (jj) The term “Wedgewood Cash Expenses” shall mean for any period,
the operating expenses for the Wedgewood Trust Property as set forth in
an Approved Annual Budget to the extent that such expenses are actually
incurred by the Maker minus payments into the Tax and Insurance
Impound, Leasing Escrow Fund and the Replacement Escrow Fund.

          (kk) The term “Wedgewood Debt” shall mean, collectively, the
whole of the principal sum of the Wedgewood Note, together with all
interest accrued and unpaid thereon and all other sums due under the
Wedgwood Loan Documents.

          (ll) The term “Wedgewood Deed of Trust” shall mean that certain
Amended and Restated Deed of Trust and Security Agreement of even date
herewith in the amount of this Note and the Consolidated Note given by
the Maker for the use and benefit of Payee covering the fee estate of
the Maker in certain premises as more particularly described therein.

          (mm) The term “Wedgewood Loan” shall mean that certain loan in
the principal amount of the Wedgewood Note made by Payee to Maker
contemporaneously
herewith.

          (nn) The term “Wedgewood Loan Documents” shall mean collectively
this Note, the Consolidated Deed of Trust, the Wedgewood Deed of Trust
and any and all other documents securing, evidencing, or guaranteeing
all or any portion of the Wedgewood Loan

-5-

 

or otherwise executed and/or delivered in connection with the Wedgewood Note
and the Wedgewood Loan.

          (oo) The
term “Wedgewood Trust Property” shall mean the property covered
by the Wedgewood Deed of Trust.

          Notwithstanding the foregoing provisions of this paragraph 1, in the
event that there is a Sale of the Wedgewood Property pursuant to Section 4.41
of the Deeds of Trust (resulting from a Securitization (as defined in the
Deeds of Trust) of the Consolidated Note that does not simultaneously include
a Securitization of this Note), then (i) all references in this Note to the
Consolidated Note, the Consolidated Loan, the Consolidated Debt, the
Consolidated Cash Expenses, the Consolidated Deed of Trust, the Consolidated
Loan Documents, the Consolidated Monthly Payment Amount, the Consolidated Note
and the Consolidated Trust Property shall be of no further force and effect.

          2. This Note is evidence of the Wedgewood Loan and of the obligation of
the Maker to repay the Wedgewood Loan in accordance with the terms hereof.
The proceeds
hereof are being used by the Maker to refinance a certain outstanding note
made by Maker and
held by Payee (the “Original Note. This Note is being executed and
delivered (i) to amend
and restate the Original Note, and (ii) if the principal amount hereof
exceeds the outstanding
principal balance of the Original Note, to provide for an increase in the
total outstanding
indebtedness of Maker. This Note is secured inter alia by (a) the
Consolidated Deed of Trust
(but only until the earlier to occur of repayment in full of this Note or
any Sale of the
Wedgewood Trust Property pursuant to Section 4.41(d) of the Deeds of
Trust), (b) the
Wedgewood Deed of Trust, and (c) the other Wedgewood Loan Documents.

          3. If any sum payable under this Note is not paid on or before the date on
which it is due, Maker shall pay to Payee upon demand an amount equal to
the lesser of three
percent (3%) of such unpaid sum or the maximum amount permitted by
applicable law in
order to defray a portion of the expenses incurred by Payee in handling
and processing such
delinquent payment and to compensate Payee for the loss of the use of such
delinquent
payment. If the day when any payment required under this Note is due is
not a Business Day,
then payment shall be due on the first Business Day thereafter.

          4. The Wedgewood Debt, or any portion thereof, shall without notice
become immediately due and payable at the option of Payee upon the
happening of any Event
of Default (as defined in the Deeds of Trust). In the event that it should
become necessary to
employ counsel to collect or enforce the Wedgewood Debt or to protect or
foreclose the
security therefor, Maker also shall pay on demand all costs of collection
incurred by Payee,
including attorneys’ fees and costs reasonably incurred for the services
of counsel whether or
not suit be brought.

          5. Maker does hereby agree that upon the occurrence of an Event of
Default (including upon the failure of Maker to pay the Wedgewood Debt in
full on the
Maturity Date), Payee shall be entitled to receive and Maker shall pay
interest on the entire
unpaid principal sum and any other amounts due at the Default Rate.

-6-

 

          6. Maker hereby agrees that upon the occurrence of an Event of
Default
Maker shall pay to Payee on the eleventh day of each month while such
Event of Default
continues, an aggregate amount equal to the Excess Cash Flow for the
prior month, such
Excess Cash Flow to be applied by Payee to the payment of the Debt in
such order as Payee
shall determine in its sole discretion, including, without
limitation, alternating applications
thereof between interest and principal and between this Note and the
Consolidated Note.
Interest at the Default Rate and Excess Cash Flow shall both be
computed from the occurrence
of the Event of Default until the actual receipt and collection of
the Debt. Interest at the
Default Rate shall be added to the Debt and shall be secured by the
Deeds of Trust. This
paragraph, however, shall not be construed as an agreement or
privilege to extend the date of
the payment of the Debt, nor as a waiver of any other right or remedy
accruing to Payee by
reason of the occurrence of any Event of Default; the acceptance of
any payment of Excess
Cash Flow shall not be deemed to cure or constitute a waiver of any
Event of Default; and
Payee retains its rights under this Note to accelerate and to
continue to demand payment of the
Wedgewood Debt upon the happening of any Event of Default despite any
payment of Excess
Cash Flow.

          7. This Note may not be prepaid prior to the Anticipated Repayment
Date;
provided, however, Maker shall have the right and option to release
the Trust Property from
the lien of the Deeds of Trust in accordance with the terms and
provisions of the Defeasance
Option. Notwithstanding the foregoing sentence, Maker shall have the
privilege to prepay the
entire principal balance of this Note and any other amounts
outstanding on any Payment Date
during the sixty (60) days preceding the Anticipated Repayment Date
without payment of the
Yield Maintenance Premium (as defined in the Deeds of Trust) or any
other premium or
penalty. Any prepayment prior to the Anticipated Repayment Date on
a date other than a
Payment Date shall, in any event, include interest through the
following Payment Date. In
addition, on the Anticipated Repayment Date or on any Payment Date
thereafter, the Maker
may, at its option and upon thirty (30) days prior written notice
from Maker to Payee, prepay
in whole or in part, in $100,000 increments only, the outstanding
principal balance of this
Note and any other amounts outstanding without payment of the Yield
Maintenance Premium
or any other premium or penalty. If prior to the Anticipated
Repayment Date and following
the occurrence of any Event of Default, Maker shall tender payment of
an amount sufficient to
satisfy the Wedgewood Debt at any time prior to a sale of the Trust
Property, either through
foreclosure or the exercise of the other remedies available to Payee
under the Deeds of Trust,
such tender by Maker shall be deemed to be voluntary and Maker shall
pay, in addition to the
Wedgewood Debt, the Yield Maintenance Premium, if any, that would be
required under the
Defeasance Option. Notwithstanding the foregoing provisions, in the
event of any Sale of the
Wedgewood Property pursuant to the provisions of Section 4.41(d) of
the Deeds of Trust, the
Consolidated Deed of Trust shall no longer secure this Note and no
fee or penalty shall be
payable upon such Sale.

          8. (a) During any Sweep Period (as defined in the Cash
Management
Agreement), Maker shall cause all Rents (as defined in the Deeds of
Trust) to be deposited in
the Clearing Account (as defined in the Cash Management Agreement).
On each Business
Day of each Collection Period (as defined in the Cash Management
Agreement), all Rents

-7-

 

deposited in the Cash Collateral Account (as defined in the Cash Management
Agreement) shall be allocated in the following order of priority:

	(i)	 	First, to fund the Tax and Insurance Impound
Fund Account (as established pursuant to the Cash Management
Agreement) until the amount on deposit therein is equal to
the amount required to be deposited in the Tax and Insurance
Impound Fund on the related Payment Date in accordance with
the terms and conditions of the Deeds of Trust;
	 
	(ii)	 	Second, to fund the Monthly Debt Service
Subaccount (as established pursuant to the Cash Management
Agreement) until the amount on deposit therein is equal to
the Wedgewood Monthly Payment Amount and the Consolidated
Monthly Payment Amount;
	 
	(iii)	 	Third, to fund the Monthly Debt Service
Subaccount with any other amounts due to the Payee under the
Loan Documents not otherwise addressed by this paragraph;
	 
	(iv)	 	Fourth, to fund the Replacement Reserve Escrow Fund Subaccount (as
established pursuant to the Cash Management Agreement) until the
amount on deposit therein is equal to the amount required to be
deposited in the Replacement Reserve (as defined in each Deed of Trust)
on the related Payment Date in accordance with the terms and conditions
of the Deeds of Trust;
	 
	(v)	 	Fifth, to fund the Leasing Escrow Fund
Subaccount (as established pursuant to the Cash Management
Agreement) until the amount on deposit therein is equal to
the amount required to be deposited in the Leasing Escrow
Fund (as defined in each Deed of Trust) on the related
Payment Date in accordance with the terms and conditions of
the Deeds of Trust; and
	 
	(vi)	 	Sixth, to fund the Operating Expense Subaccount
(as established pursuant to the Cash Management Agreement)
until the amount on deposit therein is equal to the Cash
Expenses, other than management fees payable to affiliates of
Maker or the Maker (with the exception of management fees
payable to Ross Management Co., manager of the individual
Consolidated Trust Property known as Patrick Center, pursuant
to a management agreement approved by Payee), for the month in
which such Collection Period ends pursuant to the terms and
conditions of the related Approved Annual Budget;
	 
	(vii)	 	Seventh, to fund the Operating Expense Subaccount
with any Net Capital Expenditures for the month in which such
Collection Period ends

-8-

 

	 	 	pursuant to the terms and conditions of the related
Approved Annual Budget;
	 
	(viii)	 	Eighth, to fund the Operating Expense Subaccount with any
Extraordinary Expenses approved by Payee for the for the
month in which such Collection Period ends, if any; and
	 
	(ix)	 	Lastly, to fund the Mezzanine Cash Collateral Account.

          Nothing in this paragraph 8 (a) shall limit, reduce or otherwise affect
Maker’s obligations to pay the Wedgewood Monthly Payment Amount, make
payments to the Tax and Insurance Impound Fund, Leasing Escrow Fund,
Replacement Escrow Fund due hereunder and pay other amounts due under the
other Wedgewood Loan Documents, whether or not Rents are available to make
such payments.

          (b) For each fiscal year the Maker shall submit to the Payee for the
Payee’s written approval an Annual Budget not later than sixty (60) days
prior to the commencement of such fiscal year, in form satisfactory to Payee
setting forth in reasonable detail budgeted monthly operating income and
monthly operating capital and other expenses for the Trust Property. Each
Annual Budget shall contain, among other things, limitations on management
fees, third party service fees, and other expenses as the Maker may
reasonably determine. Payee shall have the right to approve such Annual
Budget which approval shall not be unreasonably withheld, and in the event
that Payee objects to the proposed Annual Budget submitted by Maker, Payee
shall advise Maker of such objections within fifteen (15) days after receipt
thereof (and deliver to Maker a reasonably detailed description of such
objections) and Maker shall within three (3) days after receipt of notice of
any such objections revise such Annual Budget and resubmit the same to
Payee. Payee shall advise Maker of any objections to such revised Annual
Budget within ten (10) days after receipt thereof (and deliver to Maker a
reasonably detailed description of such objections) and Maker shall revise
the same in accordance with the process described in this subparagraph until
the Payee approves an Annual Budget, provided, however, that if Payee shall
not advise Maker of its objections to any proposed Annual Budget within the
applicable time period set forth in this paragraph, then such proposed
Annual Budget shall be deemed approved by Payee. Until such time that Payee
approves a proposed Annual Budget, the most recently Approved Annual Budget
shall apply; provided that, such Approved Annual Budget shall be adjusted to
reflect actual increases in real estate taxes, insurance premiums and
utilities expenses.

          9. In the event that the Maker does not pay the Debt in full prior to
the Anticipated Repayment Date, the provisions of paragraph 8 as set forth
above shall remain in full force and effect, and the following
subparagraphs also shall apply:

          (a) From and after the Anticipated Repayment Date, interest shall
accrue on the unpaid principal balance from time to time outstanding on
this Note at the Extended Term Rate. Interest accrued at the Extended Term
Rate and not paid pursuant to this paragraph 9 shall be deferred and added
to the Wedgewood Debt and shall earn interest at the Extended Term Rate to
the extent permitted by applicable law (such accrued interest is
hereinafter

-9-

 

defined as “Accrued Interest”). All of the Wedgewood Debt, including any
Accrued Interest, shall be due and payable on the Maturity Date.

          (b) All Rents deposited in the Cash Collateral Account during each
Collection Period shall be allocated to in the following order of priority, in
each case to the extent sufficient funds remain therefor:

	(i)	 	First, to fund the Tax and Insurance Impound
Fund Subaccount until the amount on deposit therein is equal
to the amount required to be deposited in the Tax and
Insurance Impound Fund on the related Payment Date in
accordance with the terms and conditions of the Deeds of
Trust;
	 
	(ii)	 	Second, to fund the Monthly Debt Service
Subaccount until the amount on deposit therein is equal to
the Consolidated Monthly Payment Amount and the Wedgewood
Monthly Payment Amount (to be applied first to the payment of
interest computed at the Initial Term Interest Rate with the
remainder applied to the reduction of the outstanding
principal balance of this Note and the Consolidated Note, in
such manner as the Lender in its sole discretion may
determine);
	 
	(iii)	 	Third, to fund the Monthly Debt Service
Subaccount with any other amounts due to the Payee under the
Loan Documents not otherwise addressed by this paragraph;
	 
	(iv)	 	Fourth, to fund the Replacement Escrow Fund
Subaccount until the amount on deposit therein is equal to
the amount required to be deposited in the Replacement Escrow
Fund on the related Payment Date in accordance with the terms
and conditions of the Deeds of Trust;
	 
	(v)	 	Fifth, to fund the Leasing Escrow Fund Subaccount
until the amount on deposit therein is equal to the amount
required to be deposited in the Leasing Escrow Fund on the
related Payment Date in accordance with the terms and
conditions of the Deeds of Trust; and
	 
	(vi)	 	Sixth, to fund the Operating Expense Subaccount
(as established pursuant to the Cash Management Agreement)
until the amount on deposit therein is equal to the Cash
Expenses, other than management fees payable to affiliates of
Maker or the Maker, for the month in which such Collection
Period ends pursuant to the terms and conditions of the
related Approved Annual Budget;
	 
	(vii)	 	Seventh, to fund the Operating Expense Subaccount
with any Net Capital Expenditures for the month in which such
Collection Period ends pursuant to the terms and conditions of
the related Approved Annual Budget;

-10-

 

	(viii)	 	Eighth, to fund the Operating Expense Subaccount with any
Extraordinary Expenses approved by Payee for the month in
which such Collection Period ends, if any;
	 
	(ix)	 	Ninth, to fund the Monthly Debt Service
Subaccount with any amount equal to the remaining principal
balance of this Note and the Consolidated Note, to be
applied against the outstanding principal due under this
Note and the Consolidated Note until such principal amounts
are paid in full;
	 
	(x)	 	Tenth, to fund the Monthly Debt Service
Subaccount with any amount equal to any Accrued Interest
hereunder and accrued interest under Paragraph 9 of the
Consolidated Note (the “Consolidated Accrued Interest”), to
be applied against the outstanding amount thereof until all
such Accrued Interest and Consolidated Accrued Interest has
been repaid;
	 
	(xi)	 	Lastly, to pay to the Maker any excess amounts.

          (c) In the event that the Maker must incur an Extraordinary Expense, then
the Maker shall promptly deliver to Payee a reasonably detailed explanation of
such proposed Extraordinary Expense for the Payee’s approval, which approval
may be granted or denied in the Payee’s sole discretion.

          (d) Nothing in this paragraph 9 shall limit, reduce or otherwise affect
Maker’s obligations to make payments of the Wedgewood Monthly Payment Amount,
payments to the Tax and Insurance Impound Fund, the Replacement Escrow Fund,
and Leasing Escrow Fund due hereunder and under the other Wedgewood Loan
Documents, whether or not Rents are available to make such payments.

          10. It is expressly stipulated and agreed to be the intent of Maker and
Payee at all times to comply with applicable state law or applicable United
States federal law (to the extent that it permits Payee to contract for,
charge, take, reserve, or receive a greater amount of interest than under
state law) and that this paragraph (and the similar paragraph contained in the
Deeds of Trust) shall control every other covenant and agreement in this Note
and the other Loan Documents. If the applicable law (state or federal) is ever
judicially interpreted so as to render usurious any amount called for under
this Note or under any of the other Wedgewood Loan Documents, or contracted
for, charged, taken, reserved, or received with respect to the Debt, or if
Payee’s exercise of the option to accelerate the Maturity Date, or if any
prepayment or the exercise of any Defeasance Option by Maker results in Maker
having paid any interest in excess of that permitted by applicable law, then
it is Payee’s express intent that all excess amounts theretofore collected by
Payee shall be credited on the principal balance of this Note and all other
Debt and the provisions of this Note and the other Wedgewood Loan Documents
immediately be deemed reformed and the amounts thereafter collectible
hereunder and thereunder reduced, without the necessity of the execution of
any new documents, so as to comply with the applicable law, but so as to
permit the recovery of

-11-

 

the fullest amount otherwise called for hereunder or thereunder. All sums
paid or agreed to be paid to Payee for the use, forbearance, or detention
of the Wedgewood Debt shall, to the extent permitted by applicable law, be
amortized, prorated, allocated, and spread throughout the full stated term
of the Wedgewood Debt until payment in full so that the rate or amount of
interest on account of the Wedgewood Debt does not exceed the maximum
lawful rate from time to time in effect and applicable to the Wedgewood
Debt for so long as the Wedgewood Debt is outstanding. Notwithstanding
anything to the contrary contained herein or in any of the other Wedgewood
Loan Documents, it is not the intention of Payee to accelerate the maturity
of any interest that has not accrued at the time of such acceleration or to
collect unearned interest at the time of such acceleration.

          11. This Note may not be modified, amended, waived, extended, changed,
discharged or terminated orally or by any act or failure to act on the
part of Maker or Payee,
but only by an agreement in writing signed by the party against whom
enforcement of any
modification, amendment, waiver, extension, change, discharge or
termination is sought.
Whenever used, the singular number shall include the plural, the plural
the singular, and the
words “Payee” and “Maker” shall include their respective successors,
assigns, heirs,
executors and administrators. If Maker consists of more than one person
or party, the
obligations and liabilities of each such person or party shall be joint
and several.

          12. Maker and all others who may become liable for the payment of all or
any part of the Wedgewood Debt do hereby severally waive presentment and
demand for
payment, notice of dishonor, protest, notice of protest, notice of
nonpayment, notice of intent
to accelerate the maturity hereof and of acceleration. No release of any
security for the
Wedgewood Debt or any person liable for payment of the Wedgewood Debt, no
extension of
time for payment of this Note or any installment hereof, and no
alteration, amendment or
waiver of any provision of the Wedgewood Loan Documents made by agreement
between
Payee and any other person or party shall release, modify, amend, waive,
extend, change,
discharge, terminate or affect the liability of Maker, and any other
person or party who may
become liable under the Wedgewood Loan Documents for the payment of all or
any part of
the Wedgewood Debt.

          13. Subject to the qualifications below, Payee shall not enforce the
liability
and obligation of Maker or its constituent members, partners,
shareholders, directors,
employees or agents to perform and observe the obligations contained in
this Note, the Deeds
of Trust or the other Loan Documents by any legal, equitable or other
action or proceeding
wherein a judgment shall be sought against Maker or its constituent
members, partners,
shareholders, directors, employees or agents, except that Payee may bring
a foreclosure
action, an action for specific performance or any other appropriate action
or proceeding to
enable Payee to enforce and realize upon its interest under this Note, the
Deeds of Trust and
the other Wedgewood Loan Documents, or in the Trust Property, the Rents,
or any other
collateral given to Payee pursuant to the Wedgewood Loan Documents;
provided, however,
that, except as specifically provided herein, any judgment in any such
action or proceeding
shall be enforceable against Maker only to the extent of Maker’s interest
in the Trust Property,
in the Rents and in any other collateral given to Payee, and Payee, by
accepting this Note, the
Deeds of Trust and the other Wedgewood Loan Documents, agrees that it
shall not sue for,

-12-

 

seek or demand any deficiency judgment against Maker in any such action or
proceeding under or by reason of or under or in connection with this Note,
the Deeds of Trust or the other Wedgewood Loan Documents. The provisions
of this paragraph shall not, however, (a) constitute a waiver, release or
impairment of any obligation evidenced or secured by any of the Wedgewood
Loan Documents; (b) impair the right of Payee to name Maker as a party
defendant in any action or suit for foreclosure and sale under the Deeds
of Trust or the Maker as a party defendant in any action or suit for
foreclosure and sale under the Wedgewood Deed of Trust; (c) affect the
validity or enforceability of or any guaranty made in connection with the
Wedgewood Loan or any of the rights and remedies of the Payee thereunder;
(d) impair the right of Payee to obtain the appointment of a receiver; (e)
constitute a waiver of the right of Payee to enforce the liability and
obligation of Maker, by money judgment or otherwise, to the extent of any
loss, damage, cost, expense, liability, claim or other obligation incurred
by Payee (including attorneys’ fees and costs reasonably incurred) arising
out of or in connection with the following:

	(i)	 	fraud or intentional misrepresentation by Maker or any
guarantor in
connection with the Wedgewood Loan;
	 
	(ii)	 	the gross negligence or willful
misconduct of Maker;
	 
	(iii)	 	physical waste
of the Trust Property;
	 
	(iv)	 	the breach of any representation, warranty, covenant or
indemnification
provision in those certain Environmental and Hazardous Substance
Indemnification Agreements of even date herewith given by Maker and
the Maker to Payee or in the Deeds of Trust concerning
environmental laws, hazardous substances or asbestos
(provided, however, that only the Maker and the Maker,
and not any of their constituent members, partners,
shareholders, directors, employees or agents, shall have
any liability for environmental matters)
	 
	(v)	 	the removal or disposal of any portion
of the Trust Property after an Event of Default;
	 
	(vi)	 	the misapplication or conversion by Maker of
(A) any insurance proceeds paid by reason of any loss,
damage or destruction to the Trust Property, (B) any
awards or other amounts received in connection with the
condemnation of all or a portion of the Trust Property,
(C) any Rents following an Event of Default, or (D) any
Rents paid more than one month in advance;
	 
	(vii)	 	failure to pay charges for labor or materials
or taxes or other charges that can create liens on any
portion of the Trust Property; and
	 
	(viii)	 	any security deposits collected with respect to the
Trust Property which are not delivered to Payee upon a
foreclosure of the Trust Property or

-13-

 

	 	 	other action in lieu thereof, except to the extent any such
security deposits were applied in accordance with the terms
and conditions of any of the Leases (as defined in the Deeds
of Trust) prior to the occurrence of the Event of Default
that gave rise to such sale or foreclosure or action in lieu
thereof.

Notwithstanding anything to the contrary in this Note or any of the Loan
Documents, (A) Payee shall not be deemed to have waived any right which Payee
may have under Section 506(a), 506(b), llll(b) or any other provisions of the
U.S. Bankruptcy Code to file a claim for the full amount of the Wedgewood Debt
secured by the Deeds of Trust or to require that all collateral shall continue
to secure all of the Wedgewood Debt owing to Payee in accordance with the
Wedgewood Loan Documents, and (B) the Wedgewood Debt shall be fully recourse
to Maker in the event that: (i) the first full monthly payment of principal
and interest under this Note is not paid when due; (ii) Maker fails to
maintain its status as a single purpose entity, as required by, and in
accordance with the terms and provisions of, the Deeds of Trust; (iii) Maker
fails to obtain Payee’s prior written consent to any subordinate financing or
other voluntary lien encumbering the Trust Property; (iv) Maker fails to
obtain Payee’s prior written consent to any assignment, transfer, or
conveyance of the Trust Property or any interest therein as required by the
Deeds of Trust, or (v) a receiver, liquidator or trustee of Maker or of any
guarantor shall be appointed or if Maker or any guarantor shall be adjudicated
a bankrupt or insolvent, or if any petition for bankruptcy, reorganization or
arrangement pursuant to federal bankruptcy law, or any similar federal or
state law, shall be filed by, consented to, or acquiesced in by, Maker or any
guarantor or if any proceeding for the dissolution or liquidation of Maker or
of any guarantor shall be instituted by Maker or any guarantor. In no event
shall Sidney Kimmel be liable for the above recourse exceptions.

          14. Maker (and the undersigned representative of Maker, if any) represents
that Maker has full power, authority and legal right to execute, deliver
and perform its
obligations pursuant to this Note, the Deeds of Trust and the other
Wedgewood Loan
Documents and that this Note, the Deeds of Trust and the other Wedgewood
Loan Documents
constitute valid and binding obligations of Maker.

          15. All notices or other communications required or permitted to be given
pursuant hereto shall be given in the manner specified in the Deeds of
Trust directed to the
parties at their respective addresses as provided therein.

          16. MAKER HEREBY AGREES NOT TO ELECT A TRIAL BY JURY
OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY RIGHT TO
TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW
OR HEREAFTER EXIST WITH REGARD TO THE LOAN DOCUMENTS, OR ANY
CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING IN CONNECTION
THEREWITH. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN
KNOWINGLY AND VOLUNTARILY BY MAKER, AND IS INTENDED TO
ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH
THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE. PAYEE IS

-14-

 

HEREBY AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS
CONCLUSIVE EVIDENCE OF THIS WAIVER BY MAKER.

          17. This Note shall be governed by and construed in accordance with
the laws of the State of Maryland and the applicable laws of the United States
of America.

          Maker has duly executed this Note the day and year first above
written.

	 	 	 	 	 	 	 	 	 	 	 
	 

	 	MAKER:	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	BUTERA PROPERTIES, LLC,
	 	 	 	 	a Delaware limited liability company
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Butera Equity, LLC,
	 	 	 	 	 	 	a Delaware limited liability company,
	 	 	 	 	 	 	Manager
	

	 	 	 	 	 	 
	 	By:	 	-s- T. Richard Butera
	

	 	 	 	 	 	 	 	 	 	

	

	 	 	 	 	 	 	 	 	 	T. Richard Butera,
	

	 	 	 	 	 	 	 	 	 	Manager

	 	 	 
	Pay to the order of              ,
	without recourse.
	 
	 	 
	CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC,
	     a Delaware limited liability company
	 
	 	 
	By:
	 	 
	

	 	

	

	 	Name:
	

	 	Title:

-15-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00067-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00067-of-00352.parquet"}]]