Document:

Exhibit 10.1

                     THIRD AMENDMENT TO CREDIT AGREEMENT

      THIS THIRD AMENDMENT  TO  CREDIT  AGREEMENT (the "Third Amendment")  is
 dated to be  effective as  of August 22, 2006,  among  FIRST CASH  FINANCIAL
 SERVICES, INC. (the "Borrower") and JPMORGAN  CHASE BANK, N.A. successor  by
 merger to Bank One, NA (Main Office Chicago) (the "Lender" and the  "Agent")
 and WELLS FARGO  BANK, NATIONAL ASSOCIATION,  successor by  merger to  Wells
 Fargo Bank Texas, National Association (the "Lender").

                             W I T N E S S E T H:

      WHEREAS, the  Borrower and  the Lenders  are  parties to  that  certain
 Credit  Agreement  dated  as  of  August 9, 2002,  and  that  certain  First
 Amendment to Loan  Agreement dated  March 1, 2004, and  that certain  Second
 Amendment to Loan Agreement dated June 30, 2005, by and between the Borrower
 and the Lenders (collectively the "Agreement"); and

      WHEREAS, the Borrower and the Lenders desire to amend the Agreement  by
 this Third Amendment to reflect the agreements, modifications and amendments
 as set forth below.

      NOW, THEREFORE, for and in consideration of the above premises and  for
 other good and valuable consideration, the parties hereto agree as follows:

      1. Definitions.  All capitalized terms defined in the Agreement and not
 otherwise defined in this  Third Amendment shall have  the same meanings  as
 assigned to them in the Agreement when used in this Third Amendment,  unless
 the context hereof shall otherwise require or provide.

      2. Representations  and Warranties.  In order  to induce the Lenders to
 enter into this Third Amendment, the Borrower represents and warrants to the
 Lenders that:

           A. The Borrower  has the requisite corporate authority to execute,
 deliver and perform the  terms and provisions of  this Third Amendment,  the
 Agreement as amended by this Third Amendment, and the Loan Documents and the
 Borrower has taken  all corporate and  other action  necessary to  authorize
 such matters; and

           B. Neither the execution and delivery of this Third Amendment, nor
 any other documents executed by the Borrower in connection herewith, nor the
 consummation of any of the transactions herein or therein contemplated,  nor
 compliance with the terms and provisions hereof or thereof, will  contravene
 or conflict with any  provision of law, statute  or regulation to which  the
 Borrower is subject or any judgment, license, order or permit applicable  to
 the Borrower or any  indenture, agreement or other  instrument to which  the
 Borrower may be subject; no consent, approval, authorization or order of any
 court, governmental authority or third party is required in connection  with
 the execution  and delivery  of this  Third Amendment  or any  of the  other
 documents executed and delivered in connection herewith or to consummate the
 transactions contemplated herein or therein;

           C. This Third Amendment, the Agreement, as amended hereby, and the
 Loan Documents  are  the legal  and  binding obligations  of  the  Borrower,
 enforceable in accordance with their respective terms, except as limited  by
 bankruptcy, insolvency or other laws of general application relating to  the
 enforcement of creditors' rights;

           D. After  the  execution of  this  Third Amendment,  no  event has
 occurred and is continuing which constitutes a Default;

           E. All  of  the  representations and  warranties  of  the Borrower
 contained in Article V of the Agreement are true and correct as of the  date
 hereof.

      3. Amendments  to Article  I.   The  following definitions  are amended
 and/or added to the Agreement and shall read as follows:

           "'Aggregate Commitment' means the aggregate of the Commitments
      of all Lenders, as reduced from time to time  pursuant to the terms
      hereof, which as of August 22, 2006 shall be equal to Fifty Million
      and no/100 Dollars ($50,000,000.00)."

           "'Facility Termination  Date'  means April  15,  2009, or  any
      earlier date on which  the Aggregate Commitment is  reduced to zero
      or otherwise terminated pursuant to the terms hereof."

           "'Guarantors' means,  collectively, Cash  &  Go, Inc.,  Famous
      Pawn, Inc., First Cash,  Inc., First Cash Corp.,  First Cash, Ltd.,
      First Cash Management,  L.L.C., One Iron  Ventures, Inc.,  FCFS MO,
      Inc., FCFS SC,  Inc.,   FCFS OK,  Inc., FCFS  MI, Inc.,  First Cash
      Credit, Ltd.,  First Cash  Credit Management,  L.L.C., First  Cash,
      S.A. de C.V., American Loan Employee Services, S.A  de C.V.,  SHAC,
      Inc., and Guaranteed Auto  Finance, Inc., and their  successors and
      assigns, and 'Guarantor' means any of the Guarantors."

           "'Guaranty' means the identical Unlimited  Guaranties dated as
      of August 22,  2006, executed  by the Guarantors  in favor  of each
      Lender, for  the ratable  benefit of  the Lenders,  as such  may be
      amended or modified  and in effect  from time to  time.   The  term
      'Guaranty' also includes  the identical Unlimited  Guaranties dated
      subsequent to  August  22,  2006 and  executed  by  SHAC, Inc.  and
      Guaranteed Auto  Finance, Inc.  in  favor of  each  Lender  for the
      ratable benefit of  the Lenders, in  the event such  Guarantors are
      not yet  Subsidiaries  on August 22, 2006,  but subsequently become
      Subsidiaries."

           4. Amendments to Article VI.

           (a) Section 6.12 is amended to read in its entirety as follows:

           "6.12.    Indebtedness.  The  Borrower will  not, nor  will it
      permit any  Subsidiary to,  create, incur  or suffer  to exist  any
      Indebtedness, except for (i) the Loans, (ii) trade debt incurred in
      the ordinary course  of business, (iii)  intercompany Indebtedness,
      (iv) endorsements of negotiable instruments in  the ordinary course
      of  business,  (v)  Indebtedness  described  in  Schedule  2,  (vi)
      Subordinated Indebtedness permitted  by all  of the  Lenders, (vii)
      Indebtedness in the amount  of $10,000,000.00, with a  term of four
      (4) years, owing by  Borrower to former shareholders  of SHAC, Inc.
      and Guaranteed  Auto Finance,  Inc., (viii)  contingent liabilities
      and indebtedness to  third Persons  of up  to $2,000,000.00  in the
      aggregate  during  any  12-month  period;  provided,  however,  the
      Borrower shall  notify  Agent  of  any contingent  liability  which
      exceeds $1,000,000.00, (ix) contingent liabilities  (in addition to
      contingent liabilities  covered in  Subsection [viii])  incurred in
      the ordinary course of  business of SHAC, Inc.  and Guaranteed Auto
      Finance, Inc.,  including,  but not  limited  to, limited  warranty
      claims and  credit life  and disability  insurance claims,  (x) any
      obligation of  the Borrower  to a  Person which  is generated  by a
      permitted Financial  Hedge, and  (xi) letters  of  credit (as  such
      instruments are  called  in  Borrower's  credit  services  product)
      issued by Borrower for the benefit of an independent lender."

           (b) Section 6.15 is amended to read in its entirety as follows:

           "6.15     Investment and Acquisitions.  The Borrower will not,
      nor will it permit any Subsidiary  to, make or suffer  to exist any
      Investments (including, without limitation, loans  and advances to,
      and other Investments in, Subsidiaries),  or commitments therefore,
      or to create any Subsidiary (except SHAC,  Inc. and Guaranteed Auto
      Finance, Inc.) or to become or remain a  partner in any partnership
      or joint venture, or to make any Acquisition  of any Person, except
      for (i) Cash Equivalent  Investments, (ii) existing  investments in
      Subsidiaries and other Investments in existence on August 22, 2006;
      provided, however, if the  Acquisition has not become  effective as
      of August 22, 2006, it  is anticipated that not  later than October
      31, 2006, SHAC,  Inc. and Guaranteed  Auto Finance, Inc.  will each
      become a Domestic Subsidiary  and, in turn, a  Guarantor, and (iii)
      investment in one additional Subsidiary with its principal place of
      business in the country of Mexico (the 'New Mexican Subsidiary') as
      long as (A)  the New Mexican  Subsidiary's primary business  is the
      same as the Borrower's, and (B) the  New Mexican Subsidiary becomes
      a Guarantor promptly after it becomes a Subsidiary."

           (c) Section 6.17 is amended to read in its entirety as follows:

           "6.17     Loans.  The  Borrower will not,  nor will  it permit
      any Subsidiary  to,  directly  or  indirectly,  make any  loans  or
      advances to any  Person except  (i) in the  ordinary course  of the
      Borrower's and Subsidiaries' businesses as they exist on August 22,
      2006, and (ii) in an  amount up to $10,000,000.00  in the aggregate
      outstanding at any one time."

           (d)  Sections 6.1(vii), 6.22.4, 6.22.5, and  6.22.6 are hereby
      deleted and replaced with the verbiage "Intentionally Omitted."

           (e)  Section 6.24  is  amended  to  read  in its  entirety  as
      follows:

           "6.24     Stock Repurchases.   Borrower  shall not  permit the
      aggregate amount  of  Stock  Repurchases to  exceed  $40,000,000.00
      during any fiscal year or $75,000,000.00 in the aggregate period of
      time commencing  August  22,  2006,  and  ending  on  the  Facility
      Termination  Date;  provided,  however,  no   Stock  Repurchase  is
      permitted during  any period  of time  the Borrower's  Fixed Charge
      Coverage Ratio is less than 1.50 to 1.00."

           5. Amendments to  Article IX.  A new Section 9.14 is added and
      shall read in its entirety as follows:

           "9.14 USA PATRIOT ACT NOTIFICATION. The following notification
      is provided to Borrower pursuant to Section 326 of the USA  Patriot
      Act of 2001, 31, U.S.C. Section 5318:

           IMPORTANT INFORMATION  ABOUT  PROCEDURES  FOR  OPENING  A  NEW
      ACCOUNT.  To help the government fight the funding of terrorism and
      money laundering  activities, Federal  law  requires all  financial
      institutions  to  obtain,  verify,  and   record  information  that
      identifies each person or  entity that opens an  account, including
      any deposit  account,  treasury  management  account,  loan,  other
      extension of  credit, or  other financial  services product.   What
      this means  for  Borrower:  When  Borrower  opens  an  account,  if
      Borrower is  an  individual  Bank  will  ask for  Borrower's  name,
      taxpayer identification number, residential address, date of birth,
      and other information  that will allow  Bank to  identify Borrower,
      and if Borrower is not  an individual Bank will  ask for Borrower's
      name, taxpayer identification  number, business address,  and other
      information that will  allow Bank to  identify Borrower.   Bank may
      also ask, if Borrower  is an individual to  see Borrower's driver's
      license or other identifying  documents, and if Borrower  is not an
      individual to  see  Borrower's  legal organizational  documents  or
      other identifying documents."

      6. Amendments to Exhibits, Schedules, and Addendum I.

           (a)  Schedule 1 to Exhibit  B (Compliance Certificate) is  amended
      as set forth in the attachment to this Third Amendment.

           (b)  Schedule 3 (Commitments  and Pro Rata  Shares) is amended  as
      set forth in the attachment to this Third Amendment.

           (c)  The cover page to  the Agreement is amended  as set forth  in
      Addendum I attached.

      7. Conditions  Precedent.  This Third  Amendment and the obligations of
 the Lenders  hereunder are  subject to  the  conditions precedent  that  the
 Borrower shall have  (a) duly  executed and  delivered to  the Lenders  this
 Third Amendment, and (b) paid to the Agent an amount to reimburse the  Agent
 for its reasonable attorneys' fees incurred in the preparation of this Third
 Amendment and related Loan  Documents, and (c) paid  to the Agent a  closing
 fee in the amount of $12,500.00 divided ratably by the Lenders.

      8. Scope of  Amendments.  Any and all other provisions of the Agreement
 and any  other  Loan Documents  are  hereby amended  and  modified  wherever
 necessary and  even through  not specifically  addressed  herein, so  as  to
 conform to  the  amendments  and  modifications  set  forth  in  this  Third
 Amendment.

      9. Limitation  on  Agreements.   The  amendments set  forth  herein are
 limited in scope as  described herein and shall  not be deemed  (a) to be  a
 consent under, or waiver of, any other term or condition of the Agreement or
 any of the Loan Documents, or (b) to prejudice any right or rights which the
 Lenders now have or may have in the future under, or in connection with  the
 Agreement as amended by this Third  Amendment, the Loan Documents or any  of
 the documents referred to herein or therein.

      10.  Multiple Counterparts.  This Third Amendment may be executed in any
 number of counterparts, all of which taken together shall constitute one and
 the same agreement,  and any of  the parties hereto  may execute this  Third
 Amendment by signing any such counterpart.

      THE CREDIT AGREEMENT, AS AMENDED BY THIS THIRD AMENDMENT, AND THE  LOAN
      -----------------------------------------------------------------------
 DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN  THE PARTIES AND MAY NOT  BE
 ----------------------------------------------------------------------------
 CONTRADICTED BY  EVIDENCE  OF  PRIOR, CONTEMPORANEOUS,  OR  SUBSEQUENT  ORAL
 ----------------------------------------------------------------------------
 AGREEMENTS OF THE PARTIES.  THERE  ARE NO UNWRITTEN ORAL AGREEMENTS  BETWEEN
 ----------------------------------------------------------------------------
 THE PARTIES.
 ------------

      Executed to be effective as of August 22, 2006.

     LENDER AND AGENT:          JPMORGAN CHASE BANK, N.A., successor by
                                merger to Bank One, NA (Main Office Chicago)

                                By:
                                      --------------------------------------
                                Name:
                                      --------------------------------------
                                Title:
                                      --------------------------------------

     LENDER:                    WELLS FARGO BANK, N. A., successor by
                                merger to Wells Fargo Bank Texas,
                                National Association

                                By:
                                      --------------------------------------
                                Name:
                                      --------------------------------------
                                Title:
                                      --------------------------------------

 BORROWER:                      FIRST CASH FINANCIAL SERVICES, INC.

                                By:
                                      --------------------------------------
                                Name:   Rick Wessel
                                      --------------------------------------
                                Title:  President
                                      --------------------------------------

 GUARANTORS:                    REVIEWED AND AGREED:

                                CASH & GO, INC.

                                By:
                                      --------------------------------------
                                Name:   Rick Wessel
                                      --------------------------------------
                                Title:  President
                                      --------------------------------------

                                FAMOUS PAWN, INC.

                                By:
                                      --------------------------------------
                                Name:   Rick Wessel
                                      --------------------------------------
                                Title:  President
                                      --------------------------------------

                                FCFS MO, INC.

                                By:
                                      --------------------------------------
                                Name:   Rick Wessel
                                      --------------------------------------
                                Title:  President
                                      --------------------------------------

                                FCFS OK, INC.

                                By:
                                      --------------------------------------
                                Name:   Rick Wessel
                                      --------------------------------------
                                Title:  President
                                      --------------------------------------

                                FCFS SC, INC.

                                By:
                                      --------------------------------------
                                Name:   Rick Wessel
                                      --------------------------------------
                                Title:  President
                                      --------------------------------------

                                FCFS MI, INC.

                                By:
                                      --------------------------------------
                                Name:   Rick Wessel
                                      --------------------------------------
                                Title:  President
                                      --------------------------------------

                                FIRST CASH, INC.

                                By:
                                      --------------------------------------
                                Name:   Rick Wessel
                                      --------------------------------------
                                Title:  President
                                      --------------------------------------

                                FIRST CASH CORP.

                                By:
                                      --------------------------------------
                                Name:   Rick Wessel
                                      --------------------------------------
                                Title:  President
                                      --------------------------------------

                                FIRST CASH, LTD.

                                By:     FIRST CASH MANAGEMENT, L.L.C., its
                                        General Partner

                                        By:
                                              ------------------------------
                                        Name:  Rick Wessel
                                              ------------------------------
                                        Title: Manager
                                              ------------------------------

                                FIRST CASH MANAGEMENT, L.L.C.

                                By:
                                      --------------------------------------
                                Name:   Rick Wessel
                                      --------------------------------------
                                Title:  Manager
                                      --------------------------------------

                                ONE IRON VENTURES, INC.

                                By:
                                      --------------------------------------
                                Name:   Rick Wessel
                                      --------------------------------------
                                Title:  President
                                      --------------------------------------

                                FIRST CASH CREDIT, LTD.

                                By:     FIRST CASH CREDIT MANAGEMENT,
                                        L.L.C., its General Partner

                                        By:
                                              ------------------------------
                                        Name:     R. Douglas Orr
                                              ------------------------------
                                        Title:    Manager
                                              ------------------------------

                                FIRST CASH CREDIT MANAGEMENT, L.L.C.

                                By:
                                      --------------------------------------
                                Name:   R. Douglas Orr
                                      --------------------------------------
                                Title:  Manager
                                      --------------------------------------

                                FIRST CASH, S.A. DE C.V.

                                By:
                                      --------------------------------------
                                Name:   R. Douglas Orr
                                      --------------------------------------
                                Title:  Legal Representative
                                      --------------------------------------

                                AMERICAN LOAN EMPLOYEE SERVICES, S.A. DE C.V.

                                By:
                                      --------------------------------------
                                Name:   R. Douglas Orr
                                      --------------------------------------
                                Title:  Legal Representative
                                      --------------------------------------

                                EXECUTION BY THE FOLLOWING CORPORATIONS
                                REQUIRED ONLY IF SUCH CORPORATIONS ARE
                                SUBSIDIARIES AS OF OCTOBER 31, 2006

                                SHAC, INC.

                                By:
                                      --------------------------------------
                                Name:   R. Douglas Orr
                                      --------------------------------------
                                Title:  Secretary
                                      --------------------------------------

                                GUARANTEED AUTO FINANCE, INC.

                                By:
                                      --------------------------------------
                                Name:   R. Douglas Orr
                                      --------------------------------------
                                Title:  Secretary
                                      --------------------------------------

<PAGE>

                     SCHEDULE 1 TO COMPLIANCE CERTIFICATE

                    Compliance as of _________, ____ with
                     Provisions of Sections 6.22 and 6.24
                              of the Agreement

 Description of Covenant                Calculation as of _____________, 20__

 (i)  Fixed Charge Coverage Ratio of   _______________ to 1.00 ______________
      not less than 1.25 to 1.00
      (Section 6.22.2) of Agreement)

 (ii) Leverage Ratio of not greater    _______________ to 1.00 ______________
      than 2.50 to 1.00
      (Section 6.22.3 of Agreement)

 (iii) Stock Repurchase of not more    _________$____________________________
      than $40,000,000.00 per fiscal            Fiscal year
      year and $75,000,000.00 in the
      aggregate                        _________$____________________________
      (Section 6.24 of Agreement)               Aggregate

                                       FIRST CASH FINANCIAL SERVICES, INC.

                                       By:
                                              -------------------------------
                                       Name:   R. Douglas Orr
                                              -------------------------------
                                       Title:  Chief Financial Officer
                                              -------------------------------

<PAGE>

                                  SCHEDULE 3

                                  COMMITMENTS
                              AND PRO RATA SHARES

                                                    Pro Rata
    Lender                        Commitments        Share
    ----------------------------------------------------------
    JPMorgan Chase Bank, N.A.    $33,500,000.00       67%
    Wells Fargo Bank, N.A.       $16,500,000.00       33%
                                 ______________  _____________
    Total                        $50,000,000.00     100.00%

<PAGE>

                                  ADDENDUM I

                                  COVER PAGE

                             AMENDED AND RESTATED

                               CREDIT AGREEMENT

                                    among

                     FIRST CASH FINANCIAL SERVICES, INC.

                                 as Borrower,

                          JPMORGAN CHASE BANK, N.A.

                             as Agent and Lender,

                                     and

                        THE OTHER LENDERS PARTY HERETO

                           JPMORGAN CHASE BANK, NA.

                     as Lead Arranger and Sole Bookrunnerexv10w1

 

EXHIBIT 10.1

PROMISSORY NOTE

LOAN TERMS TABLE

Lender:
KeyBank National Association, a national banking association, its successors and assigns

Loan No.: 

Lender’s Address: 911 Main Street, Suite #1500, Kansas City, Missouri 64105

Lender’s Facsimile No.: (816) 221-8848

Borrower: BMR-Shady Grove B LLC

Borrower’s Address: 17140 Bernardo Center Drive, Suite 222, San Diego, California 92128

Borrower’s Facsimile No.: (858) 485-9843

Borrower’s Tax Identification Number:

Note Date: August 23, 2006

Original Principal Amount: $147,000,000.00

Maturity Date: September 1, 2016

Interest Rate: 5.97 percent (5.97%) per annum

Initial Interest Payment Per Diem: $24,377.50

Monthly P&I Commencement Date: October 1, 2011

Monthly P&I Payment: $878,506.00

Monthly Payment Date: October 1, 2006 and on the first day of each successive month thereafter

     1. Loan Amount and Rate. FOR VALUE RECEIVED, Borrower promises to pay to the order of
Lender, the Original Principal Amount (or so much thereof as is outstanding from time to time,
which is referred to herein as the “Outstanding Principal Balance” or “OPB”), with interest on the
unpaid OPB from the date of disbursement of the Loan (as hereinafter defined) evidenced by this
Promissory Note (“Note”) at the Interest Rate. Interest shall be calculated based on the daily
rate which is produced assuming a three hundred sixty (360) day year multiplied by the actual
number of days elapsed. The loan evidenced by this Note will sometimes hereinafter be called the
“Loan.” The above Loan Terms Table (hereinafter referred to as the “Table”) is a part of the Note
and all terms used in this Note that are defined in the Table shall have the meanings set forth
therein.

     2. Principal and Interest Payments. Payments of principal and interest shall be made as
follows:

     (a) An interest payment on the date of disbursement of the Loan proceeds in an amount
calculated by multiplying the Initial Interest Payment Per Diem by the number of days from (and
including) the date of the disbursement of the Loan proceeds through the last day of the calendar
month in which the disbursement was made;

 

 

     (b) An interest only payment on each Monthly Payment Date prior to the Monthly P&I
Commencement Date, each of such payments to be applied to the payment of interest computed at the
Interest Rate;

     (c) Commencing on the Monthly P&I Commencement Date, a Monthly P&I Payment on each Monthly
Payment Date until the Maturity Date, each of such
payments to be applied: (i) to the payment of interest computed at the Interest Rate; and
(ii) the balance applied toward the reduction of the principal balance of the Loan; and

     (d) If not sooner paid, the balance of the principal amount of the Loan, all unpaid interest
thereon, and all other amounts owed to Lender pursuant to this Note or any other Loan Document (as
hereinafter defined) or otherwise in connection with the Loan or the security for the Loan shall be
due and payable on the Maturity Date.

     (e) All references to “Monthly Payment” in this Note shall mean either the Monthly Interest
Only Payment or the Monthly P&I Payment, as applicable.

     3. Security for Note. This Note is secured by an Indemnity Guaranty (the “Indemnity
Guaranty”) given by BMR-Shady Grove Road HQ LLC, a Maryland limited liability company (“Property
Owner”) which Indemnity Guaranty is secured by that certain Indemnity Deed of Trust, Assignment of
Leases and Rents, Security Agreement and Fixture filing (the “Security Instrument”) encumbering the
Property. This Note, the Indemnity Guaranty, the Security Instrument, and all other documents and
instruments existing now or after the date hereof that evidence, secure or otherwise relate to the
Loan, including any assignments of leases and rents, other assignments, security agreements,
financing statements, guaranties, indemnity agreements (including environmental indemnity
agreements), letters of credit, or escrow/holdback or similar agreements or arrangements, together
with all amendments, modifications, substitutions or replacements thereof, to which Borrower,
Property Owner, Key Principal, Guarantor or Indemnitor, or their successors or assigns are a party
are sometimes herein collectively referred to as the “Loan Documents” or individually as a “Loan
Document.” All amounts that are now or in the future become due and payable under this Note, the
Indemnity Guaranty, the Security Instrument, or any other Loan Document, including any Prepayment
Consideration (as hereinafter defined) and all applicable expenses, costs, charges, and fees, will
be referred to herein as the “Debt.” The remedies of Lender as provided in this Note, any other
Loan Document, or under applicable law shall be cumulative and concurrent, may be pursued
singularly, successively, or together at the discretion of Lender, and may be exercised as often as
an occasion shall occur. The failure to exercise any right or remedy shall not be construed as a
waiver or release of the right or remedy respecting the same or any subsequent default.

     4. Payments. All amounts payable hereunder shall be payable in lawful money of the United
States of America to Lender at Lender’s Address or such other place as the holder hereof may
designate in writing. Each payment made hereunder shall be made in immediately available funds and
must state the Borrower’s Loan Number. If any payment of principal or interest on this Note is due
on a day other than a Business Day (as hereinafter defined), such payment shall be made on the next
succeeding Business Day, and such extension of time shall be included in computing interest in
connection with such payment. Any payment on this Note received after 2:00 o’clock p.m. local time
at the place then designated as the place

 

 

for receipt of payments hereunder shall be deemed to have been made on the next succeeding Business Day.
All amounts due under this Note shall be payable without set off, counterclaim, or any other deduction whatsoever. All payments from Borrower to
Lender following the occurrence and during the continuation of an Event of Default shall be applied
in such order and manner as Lender elects in reduction of costs, expenses, charges, disbursements
and fees payable by Borrower hereunder or under any other Loan Document, in reduction of interest
due on unpaid principal, or in reduction of principal. Lender may, without notice to Borrower or any
other person, accept one or more partial payments of any sums due or past due hereunder from time
to time while an uncured Event of Default exists hereunder, after Lender accelerates the
indebtedness evidenced hereby, and/or after Lender commences enforcement of its remedies under any
Loan Document or applicable law, without thereby waiving any Event of Default, rescinding any
acceleration, or waiving, delaying, or forbearing in the pursuit of any remedies under the Loan
Documents. Lender may endorse and deposit any check or other instrument tendered in connection
with such a partial payment without thereby giving effect to or being bound by any language
purporting to make acceptance of such instrument an accord and satisfaction of the indebtedness
evidenced hereby. As used herein, the term “Business Day” shall mean a day upon which commercial
banks are not authorized or required by law to close in the city designated from time to time as
the place for receipt of payments hereunder.

     5. Late Charge. If any sum payable under this Note or any other Loan Document is not received
by Lender by close of business on the fifth (5th) day after the date on which it was due, Borrower
shall pay to Lender an amount (the “Late Charge”) equal to the lesser of (a) two percent (2%) of
the full amount of such sum or (b) the maximum amount permitted by applicable law in order to help
defray the expenses incurred by Lender in handling and processing such delinquent payment and to
compensate Lender for the loss of the use of such delinquent payment. Any such Late Charge shall
be secured by the Guaranty and the other Loan Documents. The collection of any Late Charge shall
be in addition to, and shall not constitute a waiver of or limitation of, a default or Event of
Default hereunder or a waiver of or limitation of any other rights or remedies that Lender may be
entitled to under any Loan Document or applicable law.

     6. Default Rate. Upon the occurrence of an Event of Default (including the failure of
Borrower to make full payment on the Maturity Date), Lender shall be entitled to receive and
Borrower shall pay interest on the Outstanding Principal Balance at the rate of three percent (3%)
per annum above the Interest Rate (“Default Rate”) but in no event greater than the maximum rate
permitted by applicable law. Interest shall accrue and be payable at the Default Rate from the
occurrence of an Event of Default until all Events of Default have been fully cured or waived in
writing by Lender. Such accrued interest shall be added to the Outstanding Principal Balance, and
interest shall accrue thereon at the Default Rate until fully paid. Such accrued interest shall be
secured by the Indemnity Guaranty and the other Loan Documents. Borrower agrees that Lender’s
right to collect interest at the Default Rate is given for the purpose of compensating Lender at
reasonable amounts for Lender’s added costs and expenses that occur as a result of Borrower’s
default and that are difficult to predict in amount, such as increased general overhead,
concentration of management resources on problem loans, and increased cost of funds. Lender and
Borrower agree that Lender’s collection of interest at the Default Rate is not a fine or penalty,
but is intended to be and shall be deemed to be reasonable compensation to Lender for increased
costs and expenses that Lender will incur if

 

 

there occurs an Event of Default hereunder. Collection of interest at the Default Rate shall not be construed as an agreement or privilege to
extend the Maturity Date or to limit or impair any rights and remedies of Lender under any Loan
Documents. If judgment is entered on this Note, interest shall continue to accrue post-judgment at
the greater of (a) the Default Rate or (b) the applicable statutory judgment rate.

     7. Origination, Administration, Enforcement, and Defense Expenses. Borrower shall pay Lender,
on demand, all Administration and Enforcement Expenses (as hereinafter defined) now or hereafter
incurred by Lender, together with interest thereon at the Default Rate, from the date paid or
incurred by Lender until such fees and expenses are paid by Borrower, whether or not an Event of
Default or Default then exists. For the purpose of this Note, “Administration and Enforcement
Expenses” shall mean all reasonable fees and expenses incurred at any time or from time to time by
Lender, including legal (whether for the purpose of advice, negotiation, documentation, defense,
enforcement or otherwise), accounting, financial advisory, auditing, rating agency, appraisal,
valuation, title or title insurance, engineering, environmental, collection agency, or other expert
or consulting or similar services, in connection with: (a) the origination of the Loan, including
the negotiation and preparation of the Loan Documents and any amendments or modifications of the
Loan or the Loan Documents, whether or not consummated; (b) the administration, servicing or
enforcement of the Loan or the Loan Documents, including any request for interpretation or
modification of the Loan Documents or any matter related to the Loan or the servicing thereof
(which shall include the consideration of any requests for consents, waivers, modifications,
approvals, lease reviews or similar matters and any proposed transfer of the Property or any
interest therein), (c) any litigation, contest, dispute, suit, arbitration, mediation, proceeding
or action (whether instituted by or against Lender, including actions brought by or on behalf of
Borrower, Property Owner or Borrower’s or Property Owner’s bankruptcy estate or any indemnitor or
guarantor of the Loan or any other person) in any way relating to the Loan or the Loan Documents
including in connection with any bankruptcy, reorganization, insolvency, or receivership
proceeding; (d) any attempt to enforce any rights of Lender against Borrower, Property Owner or any
other person that may be obligated to Lender by virtue of any Loan Document or otherwise whether or
not litigation is commenced in pursuance of such rights; and (e) protection, enforcement against,
or liquidation of the Property or any other collateral for the Loan, including any attempt to
inspect, verify, preserve, restore, collect, sell, liquidate or otherwise dispose of or realize
upon the Loan, the Property or any other collateral for the Loan. All Administration and
Enforcement Expenses shall be additional Debt hereunder secured by the Indemnity Guaranty, and may
be funded, if Lender so elects, by Lender paying the same to the appropriate persons and thus
making an advance on Borrower’s behalf.

     8. Prepayment; Defeasance.

     (a) Restrictions. Voluntary prepayment of this Note is prohibited except during the last one
hundred twenty (120) days of the term when prepayment may be made in whole, but not in part,
without payment of any Prepayment Consideration (as hereinafter defined), on any Monthly Payment
Date. Notwithstanding anything contained in this Article 8 to the contrary, no Prepayment
Consideration shall be due in connection with a complete or partial prepayment resulting from: (i)
the application of insurance proceeds or condemnation awards pursuant to the Security Instrument;
or (ii) changes in tax or debt credit laws as may be required

 

 

pursuant to the Security Instrument, but Borrower shall be required to pay all other sums due hereunder together with all interest
accrued thereon. Any such partial prepayments shall reduce the Outstanding Principal Balance, but
shall not reduce the amount of the Monthly Payment.

     (b) Defeasance.

          (i) Provided that as of the Release Date (as hereinafter defined) the Debt has not been
accelerated, no Event of Default exists, and no event has occurred that with the passage of time,
giving of notice, or modification or termination of the automatic stay of Section 362 of the United
States Bankruptcy Code may become an Event of Default (“Default”), Borrower may cause the release
of the Property from the lien of the Security Instrument and the other Loan Documents
(“Defeasance”) on any Monthly Payment Date following the earlier of (x) August 22, 2009 or (y) the
date that is two (2) years and fifteen (15) days after the “startup day” within the meaning of
Section 860G(a)(9) of the Internal Revenue Code of 1986, as amended (together with any successor
statute and the related Treasury Department Regulations including temporary regulations, the
“Code”) of any “real estate mortgage investment conduit” within the meaning of Section 860D of the
Code (“REMIC”) that holds this Note upon Borrower’s satisfaction of the following conditions:

     (A) Borrower shall provide Lender not less than thirty (30) days’ prior written notice
specifying a Business Day (such Business Day, or any extended Business Day upon which
Borrower and Lender may mutually agree is referred to herein as the “Release Date”) on which
the Defeasance Collateral (as hereinafter defined) is to be delivered. Borrower may
withdraw any proposed Defeasance, and not obtain the release of the Property from the lien
of the Security Instrument pursuant to this Article 8, provided (x) notice of such
withdrawal is delivered to Lender not later than ten (10) days prior to the proposed Release
Date, and (y) Borrower reimburses Lender, its servicers or other agent(s) or third parties
for all reasonable costs and expenses (including reasonable attorneys’ fees) incurred in
connection with the withdrawn Defeasance proposal;

     (B) On the Release Date Borrower shall pay in full all accrued and unpaid interest and
all other sums due under this Note and under the other Loan Documents up to the Release
Date, including all reasonable costs and expenses (including reasonable attorneys’ fees)
incurred by Lender or its servicers or other agent(s) or to or on behalf of any rating
agencies or other third parties in connection with such release and related transactions
(including the review of the proposed Defeasance Collateral and the preparation of the
Defeasance Security Agreement (as hereinafter defined) and related documentation), together
with a defeasance processing fee in the amount of $5,000; and

     (C) Borrower shall deliver the following, all of which must be satisfactory to Lender,
at or prior to the release of the Property and substitution of the Defeasance Collateral:

          (1) Direct, non-callable and non-redeemable securities evidencing an obligation to pay
principal and interest in a full and timely

 

 

manner that are direct obligations of the United
States of America for the payment of which its full faith and credit is pledged (the
“Defeasance Collateral”) in amounts sufficient to pay all scheduled principal and interest
payments required under this Note, which securities provide for payments on or prior to, but
as close as possible to all successive Monthly Payment Dates occurring after the Release
Date, with each such payment being equal to or greater than the amount of the corresponding
Monthly Payment required to be made hereunder for the balance of the term hereof plus the
amount required to be paid on the Maturity Date (the “Scheduled Defeasance Payments”), each
of which shall be duly endorsed by the holder thereof as directed by Lender or accompanied
by a written instrument of transfer in form and substance reasonably satisfactory to Lender
(including such instruments as may be required by the depository institution or other entity
holding such securities or the issuer thereof, as the case may be, to effectuate book-entry
transfers and pledges through the book-entry facilities of such institution) in order to
perfect upon the delivery of the Defeasance Security Agreement (as hereinafter defined) a
valid, first priority lien and security interest therein in favor of Lender in conformity
with all applicable state and federal laws governing granting of such security interest;

          (2) any and all agreements, certificates, opinions, documents or instruments reasonably
required by Lender in connection with the Defeasance including (a) a pledge and security
agreement, in form and substance satisfactory to Lender, creating a first priority security
interest in favor of Lender in the Defeasance Collateral (the “Defeasance Security
Agreement”), and (b) any and all agreements, certificates, opinions, documents, or
instruments reasonably required by Lender that affect or relate in any way to the
maintenance by any REMIC that holds this Note of its qualification and status for tax
purposes as a REMIC;

          (3) a certificate of Borrower certifying that (a) all of the requirements set forth in
this Section 8(b) have been satisfied, and (b) the transactions that are being carried out
pursuant to this Section 8(b) (including specifically the release of the lien of the
Security Instrument) are being effected to facilitate the disposition of the Property or any
other customary commercial transaction and not as part of an arrangement to collateralize a
REMIC offering with obligations that are not real estate mortgages;

          (4) an opinion of counsel for Borrower, delivered by counsel reasonably acceptable to
Lender, stating, among other things but without substantive qualification, other than
customary qualifications, assumptions and exceptions, that (a) Lender has a valid, duly
perfected, first priority security interest in the Defeasance Collateral and that the
Defeasance Security Agreement is enforceable against Borrower in accordance with its terms,
(b) neither the Defeasance nor any other transaction that occurs pursuant to the provisions
of this Section 8(b) has caused or will cause the Loan (including for this purpose the Loan
Documents) to cease to be a “qualified mortgage” within the meaning of Section 860G of the
Code, either under the provisions of Treasury Regulation Sections 1.860G-2(a)(8) or
1.860G-2(b) (as such regulations may be amended or superseded from time to time) or under
any other provision of the Code or otherwise, and (c) the tax qualification and status of
any REMIC

 

 

or any other entity that holds this Note will not be adversely impaired or
affected as a result of the Defeasance and/or any other transaction that occurs pursuant to
the provisions of this Section 8(b). The opinions set forth in clauses (b) and (c) above
may, in Lender’s discretion, be rendered by counsel to Lender at Borrower’s sole cost and
expense;

          (5) a certificate and opinion delivered by an independent certified public accounting
firm reasonably acceptable to Lender certifying that the amounts of the Defeasance
Collateral comply with all the requirements of this Section including the requirement that
the Defeasance Collateral shall generate monthly amounts equal to or greater than the
Scheduled Defeasance Payments required to be paid under this Note through the Maturity Date;

          (6) Upon Lender’s request, written confirmation from the rating agencies that have
rated any of the securities issued by any REMIC that holds this Note to the effect that the
Defeasance will not result in a downgrading, withdrawal or qualification of the respective
ratings in effect immediately prior to such Defeasance for any rated securities then
outstanding or a waiver from any such rating agency stating that it has declined to review
the Defeasance. If required by any rating agency or Lender, a non-consolidation opinion
with respect to the Defeasance Obligor (as hereinafter defined) in form and substance
reasonably satisfactory to Lender and such rating agency; and

          (7) Borrower shall (unless otherwise agreed to in writing by Lender), at Borrower’s
expense, assign all of its obligations under this Note, together with the Defeasance
Collateral, to a successor entity (“Defeasance Obligor”) designated by Lender (which may
include an entity that is owned and/or controlled by Lender) that is a single purpose,
bankruptcy remote entity as determined by Lender in its reasonable discretion. The
Defeasance Obligor shall execute an assumption agreement pursuant to which it shall assume
Borrower’s and Property Owner’s obligations under this Note, the Loan Documents, and the
Defeasance Security Agreement. As conditions to such assignment and assumption, Borrower
shall (a) deliver to Lender an opinion of counsel delivered by counsel reasonably acceptable
to Lender stating, among other things, that such assumption agreement has been duly
authorized and is enforceable against Borrower, Property Owner and the Defeasance Obligor in
accordance with its terms, that the Note, the Defeasance Security Agreement and the other
Loan Documents, as so assumed, have been duly authorized and are enforceable against the
Defeasance Obligor in accordance with their respective terms, and (b) pay all costs and
expenses including reasonable attorneys’ fees incurred by Lender or its servicer or other
agent(s) in connection with such assignment and assumption (including the review of the
proposed transferee and the preparation of the assumption agreement and related
documentation). Upon such assumption, Borrower, Property Owner, and Guarantor shall be
relieved of their obligations under this Note, the Defeasance Security Agreement and the
other Loan Documents, other than those obligations which are specifically intended to
survive the payment of this Note and the termination, satisfaction or assignment of this
Note, the Defeasance Security Agreement or the other Loan Documents, or the exercise of
Lender’s rights and remedies under any of such documents and instruments.

 

 

     (ii) Upon compliance with the requirements of this Section, Lender shall release the Property
from the lien of the Security Instrument and the other Loan Documents, and the Defeasance
Collateral shall secure this Note and all other obligations under the Loan Documents. Lender will,
at Borrower’s expense, execute and deliver any agreements reasonably requested by Borrower or
Property Owner to release the lien of the Security Instrument from the Property. Borrower, pursuant to the Defeasance Security Agreement, shall
authorize and direct that the payments received from Defeasance Collateral be made directly to
Lender and applied to satisfy the obligations of Borrower under this Note.

     (iii) Upon the release of the Property in accordance with this Section 8(b), Borrower shall
have no further right to prepay this Note. Borrower shall pay all costs and expenses incurred or
to be incurred in connection with the Defeasance and related transactions, including all charges
imposed by any rating agencies and any revenue, documentary stamp or intangible taxes or any other
tax or charge due in connection with the transfer of this Note or otherwise required to accomplish
the Defeasance and related transactions.

     (iv) If any notice of defeasance is given pursuant to Section 8(b)(i)(A), Borrower shall be
required to defease the Loan on the Release Date (unless such notice is revoked by Borrower prior
to the Release Date in which event Borrower shall immediately reimburse Lender for any and all
reasonable costs and expenses incurred by Lender in connection with Borrower’s giving of such
notice and revocation).

     (v) At Borrower’s request, Lender may agree that Lender or its servicer or other agent, acting
on Borrower’s behalf as Borrower’s agent and attorney-in-fact, shall purchase the Defeasance
Collateral that Borrower is required to deliver to Lender pursuant to Section 8(b)(i)(C)(1). If
such an agreement is made then Borrower shall deposit with Lender or Lender’s servicer or other
agent, as directed by Lender or Lender’s agent(s), on or prior to the Release Date a sum of money
sufficient to purchase the Defeasance Collateral. By making such deposit Borrower shall thereby
appoint Lender or Lender’s servicer or other agent as Borrower’s agent and attorney-in-fact, with
full power of substitution, for the purpose of purchasing the Defeasance Collateral with the funds
so provided and delivering the Defeasance Collateral to Lender pursuant to Section 8(b)(i)(C)(1).

     (vi) Notwithstanding any release of the Security Instrument or any Defeasance hereunder, the
Defeasance Obligor shall be bound by and obligated under Sections 2.1 (Secured Obligations), 7.2
(Further Acts), 7.4(a) (Estoppel Certificates), 11.2 (Application of Proceeds), 11.7 (Other Rights
Etc.) and 14.2 (Marshalling and Other Matters) and Article 13 (Indemnification) of the Security
Instrument; provided, however, that all references therein to “Property” or “Personal Property”
shall be deemed to refer only to the Defeasance Collateral delivered to Lender.

     (c) Default Prepayment. If a Default Prepayment (as hereinafter defined) occurs, such Default
Prepayment shall be deemed to be a voluntary prepayment under this Note and in such case the
applicable Prepayment Consideration (as hereinafter defined) shall be due and payable to Lender in
connection with such Default Prepayment (unless Lender voluntarily and expressly waives in writing
the right to collect such Prepayment Consideration). The Prepayment Consideration shall be secured
by all security and collateral for the Loan and

 

 

shall, after it becomes due and payable, be treated as if it were added to the Outstanding Principal Balance for all purposes including accrual of
interest, judgment on the Note, foreclosure (whether through power of sale, judicial proceeding, or
otherwise) (“Foreclosure Sale”), redemption, and bankruptcy (including pursuant to Section 506 of
the United States Bankruptcy Code or any successor provision); without limiting the generality of
the foregoing, it is understood and agreed that the Prepayment Consideration may be added to Lender’s bid at any
Foreclosure Sale. If Prepayment Consideration is due hereunder, Lender shall deliver to Borrower a
statement setting forth the amount and determination of the Prepayment Consideration, and, provided
that Lender shall have in good faith applied the formula described below, Borrower shall not have
the right to challenge the calculation or the method of calculation set forth in any such statement
in the absence of manifest error, which calculation may be made by Lender on any day during the
thirty (30) day period preceding the date of such prepayment.

     The term “Default Prepayment” shall mean a prepayment of any portion of the principal amount
of this Note made after the occurrence and during the continuance of an Event of Default under any
circumstances including a prepayment in connection with (i) reinstatement of the Security
Instrument provided by statute under foreclosure proceedings or exercise of power of sale, (ii) any
statutory right of redemption exercised by Borrower or any other party having a statutory right to
redeem or prevent foreclosure or power of sale, (iii) any sale in foreclosure or under exercise of
a power of sale or otherwise (including pursuant to a credit bid made by Lender in connection with
such sale), (iv) any other collection action by Lender, or (v) exercise by any governmental
authority of any civil or criminal forfeiture action with respect to any collateral for the Loan.
Prepayment Consideration shall be due and payable upon acceleration of the Loan in accordance with
the terms of this Note, and the “Prepayment Date”, for the purpose of computing Prepayment
Consideration, shall be the date of acceleration of the Loan in accordance with the terms of this
Note. Exchange of this Note for a different instrument or modification of the terms of this Note,
including classification and treatment of Lender’s claim (other than non-impairment under Section
1124 of the United States Bankruptcy Code or any successor provision) pursuant to a plan of
reorganization in bankruptcy shall also be deemed to be a Default Prepayment hereunder.

     The “Prepayment Consideration” (as the term is used in this Note) shall mean the present
value, as of the date of the occurrence of the Event of Default, of the remaining scheduled
payments of principal and interest from the date of the occurrence of the Default through the
Maturity Date (including any balloon payment), which shall be determined by discounting such
payments at the Discount Rate (hereinafter defined) less the amount of principal being prepaid.
The term “Discount Rate” shall mean the rate that, when compounded monthly, is equivalent to the
Treasury Rate (hereinafter defined) when compounded semi-annually. The term “Treasury Rate” shall
mean the yield calculated by the linear interpolation of the yields, as reported in Federal Reserve
Statistical Release H.15-Selected Interest Rates under the heading U.S. Government
Securities/Treasury Constant Maturities for the week ending prior to the Prepayment Date, of U.S.
Treasury constant maturities with maturity dates (one longer and one shorter) most nearly
approximating the Maturity Date. (If Release H.15 is no longer published, Lender shall reasonably
select a comparable publication to determine the Treasury Rate.)

 

 

     Borrower acknowledges that: (i) Lender has made the Loan to Borrower in reliance on, and the
Loan has been originated for the purpose of selling the Loan in the secondary market to investors
who will purchase the Loan or direct or indirect interests therein in reliance on, the actual
receipt over time of the stream of payments of principal and interest agreed to by Borrower herein;
and (ii) Lender or any subsequent investor in the Loan will incur substantial additional costs and
expenses in the event of a prepayment of the Loan; and (iii) the Prepayment
Consideration is reasonable and is a bargained for consideration and not a penalty and the
terms of the Loan are in various respects more favorable to Borrower than they would have been
absent Borrower’s agreement to pay Prepayment Consideration as provided herein. Borrower agrees
that Lender shall not, as a condition to receiving the Prepayment Consideration, be obligated to
actually reinvest the amount prepaid in any treasury obligation or in any other manner whatsoever.
Nothing contained herein shall be deemed to be a waiver by Lender of any right it may have to
require specific performance of any obligation of Borrower hereunder including to make payments
hereunder strictly according to the terms hereof or to furnish Defeasance Collateral.

     In addition to Prepayment Consideration, Borrower shall pay all hedging and breakage costs of
any kind and in any amount incurred by Lender due to any prepayment (including a Default
Prepayment).

     9. Maximum Rate Permitted by Law. All agreements in this Note and all other Loan Documents
are expressly limited so that in no contingency or event whatsoever, whether by reason of
acceleration of maturity of the indebtedness evidenced hereby or otherwise, shall the amount agreed
to be paid hereunder for the use, forbearance, or detention of money exceed the highest lawful rate
permitted under applicable usury laws. If, from any circumstance whatsoever, fulfillment of any
provision of this Note or any other Loan Document at the time performance of such provision shall
be due shall involve exceeding any usury limit prescribed by law that a court of competent
jurisdiction may deem applicable hereto, then, ipso facto, the obligations to be fulfilled shall be
reduced to allow compliance with such limit, and if, from any circumstance whatsoever, Lender shall
ever receive as interest an amount that would exceed the highest lawful rate, the receipt of such
excess shall be deemed a mistake and shall be canceled automatically or, if theretofore paid, such
excess shall be credited against the principal amount of the indebtedness evidenced hereby to which
the same may lawfully be credited, and any portion of such excess not capable of being so credited
shall be refunded immediately to Borrower.

     10. Events of Default; Acceleration of Amount Due. Lender may in its discretion, without
notice to Borrower, declare the entire Debt, including the principal balance of the Loan, all
accrued interest, all costs, expenses, charges and fees payable under any Loan Document, and
Prepayment Consideration immediately due and payable, and Lender shall have all remedies available
to it at law or equity for collection of the amounts due, if any of the following (the “Events of
Default”) occurs:

     (a) Borrower fails to make full and punctual payment of any Monthly Payment or any other
amount payable on a monthly basis under this Note or any other Loan Document within five (5) days
of the date on which such payment was due; or

 

 

     (b) Borrower fails to make full payment of the Debt when due, whether on the Maturity Date,
upon acceleration or prepayment, or otherwise; or

     (c) Borrower fails to make full and punctual payment of any Late Charges, costs and expenses
due hereunder, or any other sum of money required to be paid to Lender under this Note, or under
any other Loan Document (other than any payment described in
subclauses (a) and (b) immediately above), which failure is not cured on or before the
5th business day after Lender’s written notice that such payment is required; or

     (d) an Event of Default occurs under the Indemnity Guaranty, the Security Instrument or any
other Loan Document (as “Event of Default” is defined in such document) that has continued beyond
any applicable cure period therefor.

     11. Time of Essence. Time is of the essence with regard to each provision contained in this
Note.

     12. Transfer and Assignment. This Note may be freely transferred and assigned by Lender.
Borrower’s right to transfer its rights and obligations with respect to the Debt, and to be
released from liability under this Note, shall be governed by Section 8 of this Note in the case of
Defeasance, and otherwise under the Security Instrument.

     13. Authority of Persons Executing Note. Borrower warrants and represents that the persons or
officers who are executing this Note and the other Loan Documents on behalf of Borrower have full
right, power and authority to do so, and that this Note and the other Loan Documents executed by
Borrower constitute valid and binding documents, enforceable against Borrower in accordance with
their terms, and that no other person, entity, or party is required to sign, approve, or consent
to, this Note.

     14. Severability. The terms of this Note are severable, and should any provision be declared
by a court of competent jurisdiction to be invalid or unenforceable, the remaining provisions
shall, at the option of Lender, remain in full force and effect and shall in no way be impaired.

     15. Borrower’s Waivers. Without limiting Borrower’s rights to the notices expressly provided
hereunder (including under Section 10 hereof), Borrower and all others liable hereon hereby waive
presentation for payment, demand, notice of dishonor, protest, and notice of protest, notice of
intent to accelerate, and notice of acceleration, stay of execution and all other suretyship
defenses to payment generally. No release of any security held for the payment of this Note, or
extension of any time periods for any payments due hereunder, or release of collateral that may be
granted by Lender from time to time, and no alteration, amendment or waiver of any provision of
this Note or of any of the other Loan Documents, shall modify, waive, extend, change, discharge,
terminate or affect the liability of any guarantor or others (except Borrower) that may at any time
be liable for the payment of this Note or the performance of any covenants contained in any of the
Loan Documents.

     16. Governing Law. This Note shall be governed and construed generally according to the laws
of the State of Maryland without regard to the conflicts of law provisions thereof (“Governing
State”).

 

 

     17. JURISDICTION AND VENUE. BORROWER AND LENDER HEREBY CONSENT TO PERSONAL JURISDICTION IN
THE GOVERNING STATE. VENUE OF ANY ACTION BROUGHT TO ENFORCE THIS NOTE OR ANY OTHER LOAN DOCUMENT
OR ANY ACTION RELATING TO THE LOAN OR THE DEBT OR THE RELATIONSHIPS CREATED BY OR UNDER THE LOAN
DOCUMENTS (“ACTION”)SHALL BE IN A STATE OR FEDERAL COURT OF APPROPRIATE JURISDICTION LOCATED IN THE GOVERNING
STATE. BORROWER AND LENDER HEREBY CONSENT AND SUBMIT TO THE PERSONAL JURISDICTION OF THE STATE
COURTS OF THE GOVERNING STATE AND OF FEDERAL COURTS LOCATED IN THE GOVERNING STATE IN CONNECTION
WITH ANY ACTION AND HEREBY WAIVES ANY AND ALL PERSONAL RIGHTS UNDER THE LAWS OF ANY OTHER STATE TO
OBJECT TO JURISDICTION WITHIN SUCH STATE FOR PURPOSES OF ANY ACTION. Borrower and Lender hereby
waive and agree not to assert, as a defense to any Action or a motion to transfer venue of any
Action, (i) any claim that it is not subject to such jurisdiction, (ii) any claim that any Action
may not be brought against it or is not maintainable in those courts or that this Note or any of
the other Loan Documents may not be enforced in or by those courts, or that it is exempt or immune
from execution, (iii) that the Action is brought in an inconvenient forum, or (iv) that the venue
for the Action is in any way improper.

     18. Notices. Any notice or request required or permitted to be given hereunder must be in
writing and given (a) by depositing same in the United States mail, addressed to the party to be
notified, postage prepaid and registered or certified with return receipt requested; (b) by
delivering the same in person to such party; (c) by transmitting a facsimile copy to the correct
facsimile phone number of the intended recipient (with a second copy to be sent to the intended
recipient by any other means permitted under this Section 19); or (d) by depositing the same into
the custody of a nationally recognized overnight delivery service addressed to the party to be
notified. In the event of mailing, notices shall be deemed effective three (3) days after posting;
in the event of overnight delivery, notices shall be deemed effective on the next Business Day
following deposit with the delivery service; in the event of personal service or facsimile
transmissions, notices shall be deemed effective when delivered. For purposes of notice, the
addresses of the parties shall be as set forth in the Table. From time to time either party may
designate another address than the address set forth for all purposes of this Note by giving the
other party no less than ten (10) days advance notice of such change of address in accordance with
the notice provisions hereof. A copy of any notice sent, transmitted or delivered to Lender shall
also be delivered to Cynthia M. Hajost, Esq., Ballard Spahr Andrews & Ingersoll, LLP, 601
13th Street, N.W., Suite 1000 South, Washington, D.C. 20005, facsimile number:
(202-626-9007).

     19. Avoidance of Debt Payments. To the extent that any payment to Lender and/or any payment
or proceeds of any collateral received by Lender in reduction of the Debt is subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a
trustee, to Borrower (or Borrower’s successor) as a debtor in possession, or to a receiver,
creditor, or any other party under any bankruptcy law, state or federal law, common law or
equitable cause, then the portion of the Debt intended to have been satisfied by such payment or
proceeds shall remain due and payable hereunder, be evidenced by this Note, and shall continue in
full force and effect as if such payment or proceeds had never been received by Lender whether or
not this Note has been marked “paid” or otherwise cancelled or satisfied

 

 

and/or has been delivered to Borrower, and in such event Borrower shall be immediately obligated to return the original Note
to Lender and any marking of “paid” or other similar marking shall be of no force and effect.

     20. Nonrecourse.

     (a) Subject to the provisions of subsections (b) and (c) of this Section 20, Lender shall not
be entitled to recover any deficiency judgment against Borrower or any member of Borrower on this
Note, provided, however, the foregoing shall not be interpreted to: (i) impair or affect the right
of Lender to enforce any of its rights or remedies (other than any right to a deficiency judgment)
provided for in any of the Loan Documents or under applicable law in full accordance with the terms
thereof including the right of Lender to name Borrower, or Property Owner, as applicable, as a
party defendant in any action or suit for specific performance, foreclosure, or sale (or similar
remedy) under the Security Instrument or any other Loan Document; (ii) impair or affect the
validity or enforceability of any guaranty, indemnity agreement (including any environmental
indemnity agreement), letter of credit, or other similar third party agreement or undertaking made
in connection with this Note, Indemnity Guaranty, the Security Instrument, or any other Loan
Document; (iii) impair or affect Lender’s right to offset any and all amounts outstanding under any
of the Loan Documents against any claim or amount that may be asserted against Lender by Borrower,
or Property Owner or any partners, members, shareholders, or other owners of legal or beneficial
interests in Borrower or Property Owner; or (iv) affect the validity or enforceability of or impair
the right of Lender to bring suit and obtain specific performance or personal, recourse judgment to
enforce the liability of Borrower or any guarantor or indemnitor to the extent of, and Borrower
hereby agrees to be personally liable for, any loss, damage, cost, expense or liability incurred by
Lender (including all reasonable attorneys’ fees and expenses and other collection and litigation
expenses) arising out of or in connection with any of the following:

     (A) Property Owner or any agent or employee of Property Owner misappropriates any rents
or other Property income or collateral proceeds including insurance or condemnation proceeds
or awards;

     (B) Property Owner or any agent or employee of Property Owner fails to apply or pay
over any tenant security deposits or other refundable deposits in accordance with the terms
of the applicable lease or other agreement or the Security Instrument or any other Loan
Document;

     (C) Property Owner or any agent or employee of Property Owner receives rents or other
payments from tenants more than one month in advance and fails to apply them in accordance
with the Loan Documents;

     (D) following the occurrence and during the continuation of an Event of Default,
Property Owner or any agent or employee of Property Owner (including Property Owner in its
capacity as a debtor or debtor in possession in a bankruptcy proceeding) fails either to
apply rents or other Property income, whether collected before or after such Event of
Default, to the ordinary,

 

 

customary, and necessary expenses of operating the Property or,
upon demand, to deliver such rents or other Property income to Lender;

     (E) waste is committed on the Property during a period while Property Owner or any
agent or employee of Property Owner is in possession thereof (“waste” meaning the diminution
in the Property’s value resulting from Property
Owner’s gross negligence or willful failure to manage, maintain, repair and otherwise
operate the Property in a commercially reasonable manner);

     (F) any damage to the Property is caused as a result of the intentional misconduct or
gross negligence of Property Owner or any agent, or employee of Property Owner;

     (G) a Prohibited Transfer (as defined in the Security Instrument) occurs without
Lender’s prior written consent pursuant to the provisions of Article 8 of the Security
Instrument;

     (H) Subject to Property Owner’s right to contest set forth in the Security Instrument,
and subject to Permitted Exceptions, such governmental, public utility and private
restrictions, covenants, reservations, easements, licenses or other agreements of an
immaterial nature which may be granted by Grantor after the date hereof and which do not
have a material adverse effect on the Property, and other liens permitted under the Security
Instrument, if Property Owner fails to apply Rents (1) received from tenants to pay
insurance, taxes or assessments, and liens in accordance with the terms of the Loan
Documents, (2) to pay insurance, taxes, assessments, and liens if the tenants under the
Leases fail to make such payments, or (3) received from tenants to pay other liens or claims
that could create liens affecting the Property (unless, if applicable, Lender is escrowing
funds for taxes and insurance and fails to make such payments to the extent required under
the Security Instrument or Lender has taken possession of the Property following an Event of
Default and has received all Rents from the Property applicable to the period for which such
insurance, taxes or other items are due, and thereafter fails to make such payments to the
extent of the Rents received);

     (I) fraud or material misrepresentation by Borrower, Property Owner or any guarantor,
any indemnitor (or any agent, employee, or other person with actual or apparent authority to
make statements or representations on behalf of Borrower, Property Owner, any guarantor or
indemnitor (“apparent authority” meaning such authority as the principal knowingly or
negligently permits the agent to assume, or which he holds the agent out as possessing))
other than misrepresentations of a non-material nature which are not materially adverse to
the interest of Lender;

     (J) Property Owner fails, following the occurrence and during the continuation of an
Event of Default, to deliver to Lender on demand all security deposits, books and records
relating to the Property and in the possession or control of Property Owner or any agent or
employee of Property Owner; or

 

 

     (K)
at any time prior to the Release (as defined in the Security Instrument) there
occurs a Material Impairment on account of an Easement (each as defined in the Security
Instrument) which Lender shall not have approved under Exhibit C of the Security Instrument
and which shall have become an Event of Default; provided, however, that for the avoidance
of doubt (1) there shall at no time occur a “Material Impairment” under this Section
20(a)(K) on account of any Easement for which Property Owner sought and obtained Lender’s
approval pursuant to the provisions of Exhibit C of the Security Instrument and (2) Lender shall not be permitted to enforce
the provisions of this Section 20(a)(K) against Borrower, Property Owner or any Guarantor or
Indemnitor at any time on or after the Release.

     (b) Notwithstanding anything to the contrary in the provisions of subsection (a) of this
Section, subsection (a) of this Section shall not apply and Borrower shall be personally liable for
the Debt if (i) there shall be any violation of the due-on-sale or due-on-encumbrance provisions of
the Security Instrument, (ii) Borrower or Property Owner shall at any time hereafter make an
assignment for the benefit of its creditors, or (iii) the Property or any part thereof shall at any
time hereafter become property of the estate or an asset in (a) a voluntary bankruptcy, insolvency,
receivership, liquidation, winding up, or other similar type of proceeding, or (b) an involuntary
bankruptcy or insolvency proceeding (other than one filed by Lender) that is not dismissed within
sixty (60) days of filing.

     (c) Nothing herein shall be deemed to constitute a waiver by Lender of any right Lender may
have under Sections 506(a), 506(b), 1111(b) or any other provision of the United States Bankruptcy
Code to file a claim for the full amount of the Debt (as defined in the Security Instrument) or to
require that all collateral shall continue to secure all of the Debt.

     21. Miscellaneous. Neither this Note nor any of the terms hereof, including the provisions of
this Section, may be terminated, amended, supplemented, waived or modified orally, but only by an
instrument in writing executed by the party against which enforcement of the termination,
amendment, supplement, waiver or modification is sought, and the parties hereby: (a) expressly
agree that it shall not be reasonable for any of them to rely on any alleged, non-written amendment
to this Note; (b) irrevocably waive any and all right to enforce any alleged, non-written amendment
to this Note; and (c) expressly agree that it shall be beyond the scope of authority (apparent or
otherwise) for any of their respective agents to agree to any non-written modification of this
Note. This Note may be executed in several counterparts, each of which counterpart shall be deemed
an original instrument and all of which together shall constitute a single Note. The failure of
any party hereto to execute this Note, or any counterpart hereof, shall not relieve the other
signatories from their obligations hereunder. As used in this Note, (i) the terms “include,”
“including” and similar terms shall be construed as if followed by the phrase “without being
limited to,” (ii) any pronoun used herein shall be deemed to cover all genders, and words importing
the singular number shall mean and include the plural number, and vice versa, (iii) all captions to
the Sections hereof are used for convenience and reference only and in no way define, limit or
describe the scope or intent of, or in any way affect, this Note, (iv) no inference in favor of, or
against, Lender or Borrower shall be drawn from the fact that such party has drafted any portion
hereof or any other Loan Document, (v) the words “Lender”, “Borrower” and “Property Owner” shall
include their respective successors (including, in the case of Property Owner, any subsequent owner
or owners of the Property or any part thereof or

 

 

any interest therein and Property Owner in its
capacity as debtor-in-possession after the commencement of any bankruptcy proceeding), assigns,
heirs, personal representatives, executors and administrators, and (vi) the words “hereof”,
“herein”, “hereby”, “hereunder”, and similar terms in this Note refer to this Note as a whole and
not to any particular provision or section of this Note. Wherever Lender’s judgment, consent,
approval or discretion is required under this Note or Lender shall have an option, election, or
right of determination or any other power to decide any matter relating to the terms of this Note,
including any right to determine
that something is satisfactory or not (“Decision Power”), such Decision Power shall be
exercised in the sole and absolute discretion of Lender except as may be otherwise expressly and
specifically provided herein. Such Decision Power and each other power granted to Lender upon this
Note or any other Loan Document may be exercised by Lender or by any authorized agent of Lender
(including any servicer and/or attorney-in-fact), and Borrower hereby expressly agrees to recognize
the exercise of such Decision Power by such authorized agent. BORROWER ACKNOWLEDGES AND AGREES
THAT IT HAS BEEN PROVIDED WITH SUFFICIENT AND NECESSARY TIME AND OPPORTUNITY TO REVIEW THE TERMS OF
THIS NOTE, THE GUARANTY, THE SECURITY INSTRUMENT, AND EACH OF THE LOAN DOCUMENTS, WITH ANY AND ALL
COUNSEL IT DEEMS APPROPRIATE, AND THAT NO INFERENCE IN FAVOR OF, OR AGAINST, LENDER OR BORROWER
SHALL BE DRAWN FROM THE FACT THAT EITHER SUCH PARTY HAS DRAFTED ANY PORTION HEREOF, OR THE SECURITY
INSTRUMENT, OR ANY OF THE LOAN DOCUMENTS.

     22. Waiver of Jury Trial. BORROWER AND LENDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON THE LOAN OR
ARISING OUT OF, UNDER, OR IN CONNECTION WITH THE LOAN, THIS NOTE, THE SECURITY INSTRUMENT, OR ANY
OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT (WHETHER VERBAL OR
WRITTEN), OR ACTION OF BORROWER OR LENDER. THIS PROVISION IS A MATERIAL INDUCEMENT FOR LENDER’S
MAKING OF THE LOAN.

     23. Local Law Provisions. In the event of any inconsistencies between the terms and
conditions of this Section and any other terms and conditions of this Note (other than the terms
and conditions of Section 25), the terms and conditions of this Section shall be binding.

Commercial Loan. The Loan is a commercial loan as that term is used
in the provisions of Title 12 of the Commercial Law Article of the Annotated
Code of Maryland.

Confession of Judgment. IN THE EVENT THIS NOTE OR ANY INSTALLMENT
DUE HEREUNDER IS NOT PAID WHEN DUE (WHETHER ON THE DATE DUE OR BY
ACCELERATION) OR UPON THE OCCURRENCE OF AN EVENT OF DEFAULT UNDER ANY OF THE
LOAN DOCUMENTS, THE BORROWER AUTHORIZES THE CLERK OR ANY ATTORNEY OF ANY
COURT OF RECORD TO APPEAR FOR IT AND ENTER JUDGMENT BY CONFESSION FOR THE
PRINCIPAL BALANCE THEN

 

 

OUTSTANDING UNDER THIS NOTE, TOGETHER WITH INTEREST,
COURT COSTS AND ACTUAL REASONABLE ATTORNEY’S FEES.

     24. Additional Provisions. In the event of any inconsistencies between the terms and
conditions of this Section and any other terms and conditions of this Note, the terms and
conditions of this Section shall be binding.

NONE.

[SIGNATURE PAGE FOLLOWS]

 

 

Intending to be fully bound, Borrower has executed this Note
effective as of the day and year first above written.

	 	 	 	 	 
	 	BORROWER:

BMR-SHADY GROVE B LLC,

a Delaware limited liability company

 	 
	 	By:  	BMR-SHADY GROVE HOLDINGS LLC,	 
	 	 	a Delaware limited liability company, its Member 	 
	 	 	 
	 	By:  	BIOMED REALTY, L.P.,	 
	 	 	a Maryland limited partnership, its Member 	 
	 

	 	By:  	/s/
R. Kent Griffin
 	 
	 	 	R. Kent Griffin 	 
	 	 	Chief Financial Officer

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