Document:

Exhibit 10.102

 

RECORD AND RETURN TO:

 

Cassin Cassin &
Joseph LLP

711 Third Avenue,
20th Floor

New York, New York
10017

Attn:  Carol M. Joseph, Esq.

 

MORTGAGE, ASSIGNMENT OF RENTS,
SECURITY AGREEMENT AND FIXTURE FILING

 

 

INLAND
AMERICAN BRISTOL, L.L.C., a

Delaware limited liability company, as mortgagor (Borrower)

 

for the benefit of

 

NOMURA CREDIT &
CAPITAL, INC. ,

as
mortgagee, and its successors and assigns (Lender)

 

 

THE COLLATERAL IS OR
INCLUDES FIXTURES

 

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

 

Borrower’s
Organizational Number:  4150574

Borrower’s Federal
Identification No.:  20-4816159

 

Date:                                                                    As
of June 8, 2006

Location:                                              Bristol Stop & Shop

605 Metacom Avenue

Bristol, Rhode Island

 

County:                                                     Bristol

 

 

MORTGAGE, ASSIGNMENT OF RENTS,

SECURITY AGREEMENT AND FIXTURE FILING

 

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

 

W I  T  N  E  S  S
E  T  H:

 

WHEREAS, this
Mortgage is given to secure a loan (the “Loan”) in the
principal sum of EIGHT MILLION THREE HUNDRED SIXTY-EIGHT
THOUSAND SIXTY-SEVEN AND 00/100 DOLLARS ($8,368,067.00) advanced
pursuant to that certain Loan Agreement dated as of the date hereof between
Borrower and Lender (as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time, the “Loan
Agreement”, and evidenced by that certain Promissory Note dated
the date hereof made by Borrower to Lender (such Note, together with all
extensions, renewals, replacements, restatements or modifications thereof being
hereinafter referred to as the “Note”),
which Note provides, among other things, for final payment of principal and
interest thereunder, if not sooner paid or payable as provided therein, to be
due on June 11, 2031;

 

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

 

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

 

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

 

 

ARTICLE 1

GRANTS OF SECURITY

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

4

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

5

 

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

 

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

 

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

 

6

 

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

 

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

 

CONDITIONS TO GRANT

 

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

 

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

 

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

 

ARTICLE 2

DEBT AND OBLIGATIONS SECURED

 

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

 

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

 

7

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

ARTICLE 3

BORROWER COVENANTS

 

Borrower covenants and agrees that:

 

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

 

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

 

8

 

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

 

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

 

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

 

Section 3.6.                                   Payment for Labor and Materials.

 

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

 

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

 

9

 

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

 

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

 

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

 

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

 

10

 

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

 

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

 

ARTICLE 4

OBLIGATIONS AND RELIANCES

 

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

 

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

 

Section 4.3.                                   No Lender Obligations.

 

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

 

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

 

11

 

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

 

ARTICLE 5

FURTHER ASSURANCES

 

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

 

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

 

12

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

13

 

ARTICLE 6

DUE ON SALE/ENCUMBRANCE

 

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

 

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

 

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

 

14

 

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

 

ARTICLE 7

RIGHTS AND REMEDIES UPON DEFAULT

 

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

 

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

 

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

 

15

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

16

 

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

 

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

 

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

 

(i)                                     Taxes and Other Charges;

 

(ii)                                  Insurance Premiums;

 

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

 

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

 

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

 

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

 

 

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

 

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

 

17

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

18

 

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

 

Section 7.7.                                   Other Rights, Etc.

 

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

 

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

 

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

 

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

 

19

 

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

 

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

 

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

 

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

 

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

 

20

 

ARTICLE 8

ENVIRONMENTAL HAZARDS

 

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

 

21

 

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

 

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

 

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

 

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

 

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

 

22

 

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

 

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

 

23

 

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

 

ARTICLE 9

INDEMNIFICATIONS

 

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

 

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

 

25

 

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

 

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

 

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

 

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

 

26

 

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

 

27

 

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

 

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

 

28

 

ARTICLE 10

WAIVERS

 

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

 

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

 

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

 

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

 

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

 

29

 

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

 

ARTICLE 11

EXCULPATION

 

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

 

ARTICLE 12

NOTICES

 

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

 

ARTICLE 13

APPLICABLE LAW

 

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

 

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

 

30

 

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

 

ARTICLE 14

DEFINITIONS

 

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

 

ARTICLE 15

MISCELLANEOUS PROVISIONS

 

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

 

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

 

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

 

31

 

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

 

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

 

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

 

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

 

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

 

ARTICLE 16

INTENTIONALLY OMITTED

 

[Signature Page to
Follow]

 

32

 

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

 

	
   

  	
   

  	
  BORROWER:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  INLAND
  AMERICAN BRISTOL, L.L.C., a

  
	
   

  	
   

  	
  Delaware limited liability company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  INLAND
  AMERICAN CERUZZI BRISTOL

  
	
   

  	
   

  	
   

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

  
	
   

  	
   

  	
   

  	
  its Sole Member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  INLAND
  AMERICAN BRISTOL MEMBER

  
	
   

  	
   

  	
   

  	
   

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

  
	
   

  	
   

  	
   

  	
   

  	
  its Manager

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  INLAND
  AMERICAN REAL ESTATE

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  TRUST, INC.,
  a Maryland corporation,

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  its Sole Member

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:Exhibit 10.103

 

WHEN RECORDED RETURN TO)

 

Thompson & Knight
L.L.P.

1700 Pacific Avenue

Suite 3300

Dallas, Texas 75201

Attention: Jeanne M. Burton

 

OPEN-END MORTGAGE AND SECURITY AGREEMENT

TO SECURE PRESENT AND FUTURE LOANS

UNDER CHAPTER 25 OF TITLE 34 OF THE GENERAL LAWS

 

755096

 

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

 

WITNESSETH:

 

B.                        Borrower
is justly indebted to Lender for money borrowed (the “Loan”) in the
original principal sum of Eleven Million Five Hundred Thirty One Thousand and
No/100 Dollars ($11,531,000.00) (the “Loan Amount”) evidenced by
Borrower’s secured promissory note of even date herewith; made payable and
delivered to Lender (as may be modified, amended, supplemented, extended or
consolidated in writing and any note(s) issued in exchange therefor or
replacement thereof) (the “Note”), in which Note Borrower promises to
pay to Lender the Loan Amount together with all accrued and unpaid interest
thereon, interest accrued at the Default Rate (if any), Late Charges (if any),
the Make Whole Premium (if any), and all other obligations and liabilities due
or to become due to Lender pursuant to the Loan Documents and all other
amounts, sums and expenses paid by or payable to Lender pursuant to the Loan
Documents and the Environmental Indemnity (collectively the “Indebtedness”)
until the Indebtedness has been paid, but in any event, the unpaid balance (if
any) remaining due on the Note shall be due and payable on July 1, 2013 (the “Maturity
Date”) or such earlier date resulting from the acceleration of the
Indebtedness by Lender. Subject to the provisions of the Note, a portion of the
Loan Amount may be advanced from time to time from and after the date hereof.
At no time, however, shall the unpaid principal balance of the Indebtedness
secured by this Mortgage (exclusive of interest and protective payments) exceed
Eleven Million Five Hundred Thirty One Thousand and No/100 Dollars
($11,531,000.00). Capitalized terms used herein and not otherwise defined shall
have those meanings given to them in the other Loan Documents.

 

C.                        NOW,
THEREFORE, to secure the payment of the Indebtedness in accordance with the
terms and conditions of the Loan Documents, and all extensions, modifications
and renewals

 

1

 

thereof and the
performance of the covenants and agreements contained therein, and also to secure
the payment of any and all other Indebtedness, direct or contingent, that may
now or hereafter become owing from Borrower to Lender in connection with the
Loan Documents, and in consideration of the Loan Amount in hand paid, receipt
of which is hereby acknowledged, Borrower does by these presents grant, unto
Lender, its successors and assigns forever, that certain real estate and all of
Borrower’s estate, right, title and interest therein, located in the county of
Providence, state of Rhode Island, more particularly described in Exhibit A
attached hereto and made a part hereof (the “Land”), which Land,
together with the following described property, rights and interests, is
collectively referred to herein as the “Premises”.

 

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

 

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

 

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

 

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

 

2

 

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

 

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

 

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

 

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

 

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

 

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

 

3

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

(e)                    Borrower has
and will continue to implement procedures, and has consistently and will
continue to consistently apply those procedures, to ensure the foregoing
representations and warranties remain true and correct at all times. The term “Embargoed
Person” means any person, entity or government subject to trade
restrictions under U.S. law, including but not limited to, the International
Emergency Economic Powers Act, 50 U.S.C. §1701 et seq., The Trading with
the Enemy Act, 50 U.S.C. App. 1 et seq., and any Executive Orders or
regulations promulgated

 

4

 

thereunder with the
result that the investment in Borrower is prohibited by law or Borrower is in
violation of law;

 

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

 

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

 

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

 

BORROWER COVENANTS AND
AGREES AS FOLLOWS:

 

1.                          Borrower
shall

 

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

 

(b)                    pay a Late
Charge on any payment of principal, interest, Make Whole Premium or
Indebtedness which is not paid on or before the due date thereof to cover the
expense involved in handling such late payment;

 

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

 

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

 

(e)                     manage,
operate and maintain the Premises and keep the Premises, including but not limited
to, the Improvements, in good condition and repair and free from mechanics’
liens or other liens or claims for liens, provided however, that Borrower may
in good faith, with reasonable diligence and upon written Notice to Lender
within twenty (20) days after Borrower has knowledge of such lien or claim,
contest the validity or amount of any such lien or claim and defer payment and
discharge thereof during the pendency of such contest in the

 

5

 

manner provided by law,
provided that (i) such contest may be made without the payment thereof; (ii)
such contest shall prevent the sale or forfeiture of the Premises or any part
thereof, or any interest therein, to satisfy such lien or claim; (iii) Borrower
shall have obtained a bond over such lien or claim from a bonding company
acceptable to Lender which has the effect of removing such lien or collection
of the claim or lien so contested; and (iv) Borrower shall pay all costs and
expenses incidental to such contest; and further provided, that in the event of
a final, non-appealable ruling or adjudication adverse to Borrower, and
provided the court of jurisdiction has not granted a stay of the enforcement of
the ruling or judgment, Borrower shall promptly pay such claim or lien, shall
indemnify and hold Lender and the Premises harmless from any loss or damage
arising from such contest and shall take whatever action necessary to prevent
sale, forfeiture or any other loss or damage to the Premises or to the Lender; provided,
however, Lender acknowledges and agrees that performance of the obligations set
forth in this Paragraph 1(e) by Major Tenant (as hereinafter defined) with
respect to its leased premises shall be deemed compliance with such provisions
by Borrower with respect to such portion of the Premises; as used herein, the
term “Major Tenant” shall mean the tenant under the Lease Agreement
dated December 21, 2001 in favor of The Stop &
Shop Supermarket Company, as amended, or any lease to any
replacement tenant under such lease approved by Lender (a “Replacement
Tenant”).

 

(f)                       comply, and
cause each lessee or other user of the Premises to comply, with all
requirements of law and ordinance, and all rules and regulations, now or
hereafter enacted, by authorities having jurisdiction of the Premises and the
use thereof, including but not limited to all covenants, conditions and
restrictions of record pertaining to the Premises, the Improvements, and the
use thereof (collectively, “Legal Requirements”); provided, however,
Lender acknowledges and agrees that performance of the obligations set forth in
this Paragraph 1(f) by Major Tenant with respect to its leased premises shall
be deemed compliance with such provisions by Borrower with respect to such
portion of the Premises;

 

(g)                    subject to the
provisions of paragraph 6 hereof, promptly repair, restore or rebuild any
Improvements, now or hereafter a part of the Premises which may become damaged
or be destroyed by any cause whatsoever, so that upon completion of the repair,
restoration and rebuilding of such Improvements there will be no mortgage
interests or liens of any nature arising out of the construction and the
Premises will be of substantially the same character and quality as it was
prior to the damage or destruction; provided, however, Lender acknowledges and
agrees that performance of the obligations set forth in this Paragraph 1(g) by
Major Tenant with respect to its leased premises shall be deemed compliance
with such provisions by Borrower with respect to such portion of the Premises;

 

(h)                    if other than
a natural person, do all things necessary to preserve and keep in full force
and effect its existence, franchises, rights and privileges under the

 

6

 

laws of the state of its
formation and, if other than its state of formation, the State where the
Premises is located. Borrower shall notify Lender at least thirty (30) days
prior to (i) any relocation of Borrower’s principal place of business to a
different state or any change in Borrower’s state of formation, and/or (ii) if
Borrower is an individual, any relocation of Borrower’s principal residence to
a different state;

 

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

 

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

 

(k)                     remain a
Single-Purpose Entity.

 

2.                         Borrower
shall not:

 

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

 

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

 

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

 

Notwithstanding anything
hereinabove to the contrary, Borrower may construct, remove or demolish tenant
improvements within the then existing building(s) or

 

7

 

other structures to the
extent such work is required solely under the terms of any Leases approved by
Lender provided (i) no Event of Default exists under the Loan Documents; (ii)
the work is completed on a timely basis, in a good, workmanlike, lien-free
manner and in accordance with all Legal Requirements, and (iii) such work does
not negatively affect the structural integrity of the Improvements or the value
of the Premises;

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

It is understood and
agreed that the Indebtedness evidenced by the Note is personal to Borrower and
in reliance upon the ownership structure of Borrower and in accepting the same
Lender has relied upon what it perceived as the willingness and ability of
Borrower and the Interest Owners to perform its obligations under the Loan
Documents and the Environmental Indemnity and as lessor under the Leases of the
Premises. Furthermore, Lender may consent to a Transfer and expressly waive
Borrower’s covenants contained in this paragraph 2(f), in writing to Borrower;
however any such consent and waiver shall not constitute any consern or waiver
of such covenant as to any Transfer other than

 

8

 

that for which the
consent and waiver was expressly granted. Furthermore, Lender’s willingness to
consent to any Transfer and waive Borrower’s covenants contained in this
paragraph 2(f), implies no standard of reasonableness in determining whether or
not such consent shall be granted and the same may be based upon what Lender
solely deems to be in its best interest.

 

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

 

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

 

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

 

(ii)                    the creation,
sufferance or granting of any lien, encumbrance, security interest or
collateral assignment (whether voluntarily, involuntarily or by operation of
law), other than this Mortgage, the leases of the Premises assigned to Lender,
the Permitted Encumbrances, the granting of a lien on a tenant’s interest under
any Lease in accordance with the terms specifically set forth therein, and
those liens which Borrower is contesting in accordance with the provisions of
paragraph 1(e);

 

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

 

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

 

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

 

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

 

“Permitted
Transfer” shall mean:

 

(i)                       a minor (as
determined by Lender) conveyance of an interest in the Premises by Borrower,
such as a utility easement, and for which Lender has given its prior written
consent and imposed such conditions as Lender deems advisable and appropriate;
provided, however, with regard to those easements for which Lender’s consent is
required, if: (A) Borrower provides Lender with a written request for consent
to such easement and the request is accompanied by a copy of the proposed
easement together with a certificate executed by Borrower confirming that such
easement will not adversely affect the Premises now or in the future; (B) the
request is given in the manner provided for the giving of notices in this
Mortgage; (C) the request is boldly noted as a request for consent to an
easement for which Lender’s consent is required and specifically states that
the easement will be deemed approved if Lender fails to respond within 12
business days (Lender and Borrower hereby agree that such 12 business day
period shall commence on the date of Lender’s actual receipt of all information
reasonably required by Lender in connection with Lender’s

 

9

 

review of said easement);
and (D) in the event Lender fails to respond to Borrower’s request for consent
within the time period set forth in subparagraph (C) above, then said consent
shall be deemed to have been given; or

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

10

 

ratio of 1.5 or less; and
management personnel experienced in the ownership and management of retail
properties similar to the Premises);

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

11

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

1.                         If the
transfer is pursuant to Permitted Transfer (ix)(a) above, IARET1 or a wholly
owned Affiliate thereof: (i) maintains at least 1% ownership interests in such
joint venture (which such joint venture entity shall be the sole member of
Borrower); and (ii) maintains operational and managerial control of such joint
venture and the Premises. If the transfer is pursuant to Permitted Transfer
(ix)(b), IARETI or a wholly owned Affiliate thereof: (a) maintains at least 1%
interest in Borrower; and (b) maintains operational and managerial control of
the Premises;

 

2.                         Lender’s
receipt of an ownership processing fee equal to: (i) $5,000.00 if IARETI
maintains ten percent (10%) or more of the ownership interests in

 

12

 

Borrower or such joint
venture that acquires ownership interests in Borrower; or (ii) $15,000.00 if
IARETI maintains less than 10 percent (10%) of the ownership interests in
Borrower or such joint venture that acquires ownership interests in Borrower;

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

4.                         Receipt
by Lender of copies of (a) the organizational documents of the proposed
transferee and an opinion of counsel satisfactory to Lender as to its due
formation, valid existence and authority to enter into and carry out the
proposed transaction; (b) the deeds or other instruments of transfer and

 

13

 

documents relating to the
assignment and assumption of Leases; (c) evidence of compliance with the
insurance requirements contained in the Loan Documents; (d) compliance with the
representations and warranties in the Loan Agreement regarding the proposed
transferee’s status as a Single Purpose Entity, and (e) at Lender discretion,
acceptable background and credit checks, at Borrower’s cost;

 

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

 

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

 

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

 

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

 

9.                         Borrower
remains a Single Purpose Entity.

 

“Property
Transfer Requirements” are all of the following:

 

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

 

2.                         Payment
to Lender of an assumption fee equal to the greater of: (a) one half of one
percent (0.5%) of the principal balance of the Note; or (b) $15,000.00;
provided, however, that Lender will require $15,000.00 of such fee to be paid
at the beginning of Lender’s review process, and such sum shall be
nonrefundable and earned upon receipt by Lender whether or

 

14

 

not the transaction is
ultimately completed or Lender ultimately approves the proposed purchaser or
other transferee;

 

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

 

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

 

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

 

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

 

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

 

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

 

9.                         At
Lender’s option, and if required by the procedures promulgated by any rating agency(ies)
associated with a securitization transaction with respect to the Loan, receipt
by Lender of written evidence from such agency(ies)

 

15

 

to the effect that the
proposed transfer will not result in a re-qualification, reduction or
withdrawal of any rating in effect immediately prior to such transfer issued in
connection with the securitization transaction.

 

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

 

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

 

“Specific Transfer
Requirements - 2” are all of the following which Borrower agrees to provide
to Lender prior to each proposed transfer: IARETI or a wholly owned Affiliate
thereof (i) (a) retains 51% or more of the ownership interest in the Borrower,
or (b) retains ownership of 20% to 50% of the ownership interest in the
Borrower subject to Lender’s review and approval in each instance of the
proposed transferee and the subject transaction; Lender’s review of the
proposed transferee and the subject transaction shall encompass various
factors, including but not limited to, transferee’s creditworthiness, financial
strength, and real estate management expertise, as well as the proposed
transaction’s effect on the Premises, Borrower and the other security for the
Loan, and (ii) otherwise retains operational and management control of Borrower
as determined by Lender, and further provided Borrower provides Lender each of
the following items prior to each proposed transfer: (a) a transfer fee equal
to the greater of $5,000.00 or the product of the percentage ownership interest
in Borrower to be transferred multiplied by one percent (1%) of the outstanding
principal balance of the Loan; (b) all relevant documentation and information
related to the organization, authority, and validity of the proposed ownership
interest purchaser, transferee and the transaction in general; (c) all
documents and instruments of conveyance, transfer and assignment; (d) a
reaffirmation of the obligations of the Guarantor(s)

 

16

 

under the Guaranty; and
(e) evidence of payment of all outside counsel fees, professional fees, title
insurance fees and any and all other fees, costs and expenses related to the
proposed transfer (provided that no assumption or transfer fee other than the
$5,000.00 fee stated in (a) above shall be required).

 

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

 

(g)                   cause, permit
or allow:

 

(i)                       any person
or entity to own an interest in Borrower who is (A) identified on the Specially
Designated Nationals and Blocked Persons List maintained by OFAC and/or on any
other similar list maintained by OFAC, or (B) a party with whom a citizen of
the United States is prohibited to engage in transactions by any trade embargo,
economic sanction, or other prohibition of United States law, regulation, or
Executive Order of the President of the United States;

 

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

 

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

 

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

 

17

 

3.                         (a)                     Borrower
shall pay or cause to be paid when due and before any penalty attaches, or
interest accrues all general taxes, special taxes, assessments (including
assessments for benefits from public works or improvements whenever begun or
completed), utility charges, water charges, sewer service charges, common area
maintenance charges, if any, vault or space charges and all other like charges
against or affecting the Premises or against any property or equipment located
on the Premises, or which might become a lien on the Premises, and shall,
within 10 days following Lender’s request, furnish to Lender a duplicate
receipt of such payment. If any such tax, assessment or charge may legally be
paid in installments, Borrower may, at its option, pay such tax, assessment or
charge in installments. Lender acknowledges and agrees that performance of the
obligations set forth in this Paragraph 3(a) by Major Tenant with respect to
its leased premises shall be deemed compliance with such provisions by Borrower
with respect to such portion of the Premises.

 

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

 

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

 

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

 

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

 

4.                         (a)                     Borrower
shall at all times keep or cause to be kept in force (i) property insurance
insuring all Improvements which now are or hereafter become a part of the
Premises for perils covered by a causes of loss-special form insurance policy,
including coverage against terrorism containing both replacement cost and
agreed amount endorsements or equivalent coverage; (ii) commercial

 

18

 

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

 

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

 

(c)                     To the
contrary notwithstanding, so long as there is no Event of Default hereunder and
so long as the lease with Major Tenant or any Replacement Tenant remains in
full force and effect and there are no material breaches thereof beyond the
expiration of any applicable notice and cure periods, Lender will allow Major
Tenant or any said Replacement Tenant to keep in force the insurance required
herein, except with respect to coverage for rental insurance, and such
performance by Major Tenant shall be deemed performance by

 

19

 

Borrower with respect to
such required insurance hereunder. All insurance coverages and requirements
that are not maintained by Major Tenant or a Replacement Tenant in accordance
with the Lender’s insurance requirements herein shall at all times during the
Loan be maintained by Borrower.

 

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

 

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

 

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

 

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

 

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

 

20

 

Notwithstanding anything
hereinabove to the contrary,

 

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

 

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

 

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

 

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

 

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

 

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

 

(c)                     (i)                       In the
event that Borrower is to be reimbursed out of the insurance proceeds or out of
any award or payment received with respect to a Taking, Lender shall from time
to time make available such proceeds, subject to the following conditions: (a)
there continues to exist no Event of Default; (b) the delivery to Lender of
satisfactory evidence of the estimated cost of completion of such repair and
restoration work and any architect’s certificates, waivers of lien, contractor’s
sworn statements, and other evidence of cost and of payment and of the
continued priority of this Mortgage over any potential liens of mechanics and
materialmen (including, without limitation, title policy endorsements) as
Lender may reasonably require and approve; (c) the time required to complete
the

 

21

 

repair and restoration
work and for the income from the Premises to return to the level it was prior
to the loss will not exceed the coverage period of the rental value insurance
required hereunder; (d) the annual net cash flow (annual net operating income
after deduction for tenant improvements, leasing commissions, annual
replacement reserves and a management fee) shall equal or exceed 1.5 times the
annual debt service on the Note. Only net operating income from approved
executed Leases in effect on the Premises, having at least three (3) years
remaining prior to the expiration of their term, with no uncured defaults,
shall be used in Lender’s determination of the annual net cash flow; (e) Lender
approves the plans and specifications of such work before such work is
commenced if the estimated cost of rebuilding and restoration exceeds 25% of
the Indebtedness or involves any structural changes or modifications. If said
plans and specifications substantially comply with those previously approved by
Lender, Lender’s approval shall not be unreasonably withheld; (f) if the amount
of any insurance proceeds, award or other payment is insufficient to cover the
cost of restoring and rebuilding the Premises, Borrower shall pay such cost in
excess of such proceeds, award or other payment before being entitled to
reimbursement out of such funds; (g) Borrower pays to Lender a non-refundable
processing fee equal to the greater of $5,000.00 or .25% of the amount of such
proceeds within sixty (60) days of the occurrence of any such damage or
destruction and before Lender disburses any proceeds; and (h) such other
conditions to such disbursements, in Lender’s reasonable discretion, as would
be customarily required by a construction lender doing business in the area
where the Premises is located or which are otherwise required by any rating
agency rating a securitization transaction with respect to the Loan.

 

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

 

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

 

22

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

23

 

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

 

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

 

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

 

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

 

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

 

24

 

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

 

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

 

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

 

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

 

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

 

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

 

25

 

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

 

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

 

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

 

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

 

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

 

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

 

12.                   Upon the
occurrence of any Event of Default, in addition to any other rights or remedies
provided in the Loan Documents, at law, in equity or otherwise, Lender shall
have the STATUTORY POWER OF SALE. In any suit to foreclose this Mortgage,
and in any sale of the Premises,, there shall be allowed and included as

 

26

 

additional Indebtedness
payable by Borrower to Lender and secured hereby all expenditures and expenses
which may be paid or incurred by or on behalf of Lender for attorneys’ fees and
costs, including attorneys’ fees and costs on appeal, appraisers’ fees,
expenditures for documentary and expert evidence, stenographer’s charges,
publication and advertising costs, survey costs, environmental audits and costs
(which may be estimated as to items to be expended after the entry of any
decree) of procuring all such abstracts of title, title searches and
examinations, title insurance policies, torrens certificates and similar data
and assurances with respect to title as Lender deems reasonably necessary
either to prosecute such suit or to consummate such sale or to evidence to
bidders at any sale the true condition of the title to or the value of the
Premises. Further, upon the occurrence of an Event of Default and to the extent
permitted by law, Lender shall have the option of proceeding as to both real
and personal property in accordance with its rights and remedies in respect of
the real property, in which event the default provisions of the Uniform
Commercial Code shall not apply. The parties agree that in the event Lender
elects to proceed with respect to personal property separately from the real
property; ten (10) days’ notice of the sale of personal property shall be
sufficient notice. Borrower agrees that, without the written consent of Lender,
Borrower will not remove or permit to be removed from the Premises or the
Improvements thereon any personal property unless the same is immediately
replaced with unencumbered fixtures or articles of personal property, as the
case may be, of a quality and value equal or superior to those which they
replace. All such replacements, renewals and additions shall become and be
immediately subject to the security interest of this Mortgage and be covered
hereby. Borrower shall, from time to time, on request of Lender, deliver to
Lender an inventory of personal property in detail, including an itemization of
all items leased to Borrower or subject to a conditional bill of sale, security
agreement or other title retention agreement.

 

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

 

14.                   Following the
occurrence of an Event of Default, unless the same has been specifically waived
in writing, Borrower shall forthwith upon demand of Lender surrender to Lender
possession of the Premises, and Lender shall be entitled to take actual
possession of the Premises or any part thereof personally or by its agents or
attorneys, and Lender in its discretion may, with or without force and with or
without process of law, enter upon and take and maintain possession of all or
any part of the Premises together with all documents, books, records, papers
and accounts of the

 

27

 

Borrower or the then
owner of the Premises relating thereto, and may exclude Borrower, its agents or
assigns wholly therefrom, and may as attorney-in-fact or agent of the Borrower,
or in its own name as Lender and under the powers herein granted:

 

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

 

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

 

Lender shall not be
obligated to perform or discharge, nor does it hereby undertake to perform or
discharge, any obligation, duty or liability under any Lease. Except to the
extent that the same is caused solely by Lender’s gross negligence or willful
misconduct, should Lender incur any liability, loss or damage under any Leases,
or under or by reason of the Assignment of Leases, or in the defense of any
claims or demands whatsoever which may be asserted against Lender by reason of
any alleged obligations or undertakings on its part to perform or discharge any
of the terms, covenants or agreements in any Lease, the amount thereof,
including costs, expenses and reasonable attorneys’ fees and costs, including
reasonable attorneys’ fees and costs on appeal, shall be added to the
Indebtedness and secured hereby.

 

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

 

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

 

28

 

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

 

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

 

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

 

16.                   Upon the
occurrence of any Event of Default, unless the same has been specifically
waived in writing, Lender may apply to any court having jurisdiction for the
appointment of a receiver of the Premises. Such appointment may be made either
before or after sale, without notice, without regard to the solvency or
insolvency of Borrower at the time of application for such receiver and without
regard to the then value of the Premises or the adequacy of Lender’s security.
Lender may be appointed as such receiver. The receiver shall have the power to
collect the Rents during the pendency of any foreclosure proceeding and, in
case of a sale, during the full statutory period of redemption, if any, as well
as during any further times when Borrower, except for the intervention of such
receiver, would be entitled to collect such Rents. In addition, the receiver
shall have all other powers which shall be necessary or are usual in such cases
for the protection, possession, control, management and operation of the
Premises during the whole of said period. The court from time to time may
authorize the receiver to apply the net income in its possession at Lender’s
election and in such order as Lender may determine in payment in full or in
part of those items listed in paragraph 15.

 

17.                   (a)                     Borrower
agrees that all reasonable costs, charges and expenses, including but not
limited to, reasonable attorneys’ fees and costs, incurred or expended by
Lender arising out of or in connection with any action, proceeding or hearing,
legal, equitable or quasi-legal, including the preparation therefor and any
appeal therefrom, in any way affecting or pertaining to the Loan Documents, the
Environmental Indemnity or the Premises, shall be promptly paid by Borrower.
All such sums not promptly paid by Borrower shall be added to the Indebtedness
secured hereby and shall bear interest at the Default Rate from the date of
such advance and shall be due and payable on demand.

 

(b)                    Borrower
hereby agrees that upon the occurrence of an Event of Default and the
acceleration of the principal sum secured hereby pursuant to this Mortgage, to
the full extent that such rights can be lawfully waived, Borrower hereby waives
and agrees not to insist upon, plead, or in any manner take advantage of, any
notice of acceleration, any stay, extension, exemption, homestead, marshaling
or moratorium law or any law providing for the valuation or appraisement of all
or any part of the Premises prior to any sale or sales thereof under any
provision

 

29

 

of this Mortgage or
before or after any decree, judgment or order of any court or confirmation
thereof, or claim or exercise any right to redeem all or any part of the
Premises so sold and hereby expressly waives to the full extent permitted by
applicable law on behalf of itself and each and every person or entity
acquiring any right, title or interest in or to all or any part of the
Premises, all benefit and advantage of any such laws which would otherwise be
available to Borrower or any such person or entity, and agrees that neither
Borrower nor any such person or entity will invoke or utilize any such law to
otherwise hinder, delay or impede the exercise of any remedy granted or
delegated to Lender herein but will permit the exercise of such remedy as
though any such laws had not been enacted. Borrower hereby further expressly
waives to the full extent permitted by applicable law on behalf of itself and
each and every person or entity acquiring any right, title or interest in or to
all or any part of the Premises any and all rights of redemption from any sale
or any order or decree of foreclosure obtained pursuant to provisions of this
Mortgage.

 

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

 

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

 

30

 

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

 

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

 

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

 

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

 

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

 

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

 

25.                   (a)                     Borrower
hereby grants to Lender and its respective agents, attorneys, employees,
consultants, contractors and assigns an irrevocable license and authorization
to enter upon and inspect the Premises and all facilities located thereon at
reasonable times, subject to the inspection rights provisions afforded

 

31

 

to Borrower under the
Leases. Lender shall make reasonable efforts to ensure that the operations of
tenants are not disrupted.

 

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

 

(c)                     In the event
there has been an Event of Default or in the event Lender has formed a
reasonable belief, based on its inspection of the Premises or other factors
known to it, that Hazardous Materials may be present on the Premises, then
Borrower grants to Lender and its respective agents, attorneys, employees,
consultants, contractors and assigns an irrevocable license and authorization
to conduct, at Borrower’s expense using EMG Corp. or the firm of Borrower’s
choice, subject to Lender’s reasonable approval, environmental tests of the
Premises, including without limitation, a Phase 1 environmental audit,
subsurface testing, soil and ground water testing, and other tests which may
physically invade the Premises or facilities (the “Tests”). The scope of
the Tests shall be such as Lender, in its sole discretion, determines is
necessary to (i) investigate the condition of the Premises, (ii) protect the
mortgage and security interests created under this Mortgage, or (iii) determine
compliance with Environmental Laws, the provisions of the Loan Documents and
the Environmental Indemnity and other matters relating thereto. Lender shall
make reasonable efforts to ensure that the operations of the tenants are not
disrupted.

 

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

 

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

 

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

 

32

 

27.                   Each notice,
consent, request, report or other communication under this Mortgage or any
other Loan Document (including any notice to Lender pursuant to Sections
34-25-10(b) and 34-25-11 of the Rhode Island General Laws, as amended) (each a “Notice”)
which any party hereto may desire or be required to give to the other shall be
deemed to be an adequate and sufficient notice if given in writing and service
is made by either (i) registered or certified mail, postage prepaid, in which
case notice shall be deemed to have been received three (3) business days
following deposit to U.S. mail; or (ii) nationally recognized overnight air
courier, next day delivery, prepaid, in which case such notice shall be deemed
to have been received one (1) business day following delivery to such
nationally recognized overnight air courier. All Notices shall be addressed to
Borrower at its address given on the first page hereof or to Lender at c/o
Principal Real Estate Investors, LLC, 801 Grand Avenue, Des Moines, Iowa
50392-1450, Attn: Commercial Real Estate Servicing, Loan No. 755096, or to such
other place as either party may by written notice to the other hereafter
designate as a place for service of notice. Borrower shall not be permitted to
designate more than one place for service of Notice concurrently.

 

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

 

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

 

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

 

31.                   As used herein,
the term “Default Rate” means a rate equal to the lesser of (i) four
percent (4%) per annum above the then applicable interest rate payable under
the Note or (ii) the maximum rate allowed by applicable law.

 

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

 

33

 

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

 

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

 

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

 

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

 

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

 

34

 

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

 

REMAINDER OF PAGE INTENTIONALLY BLANK

(Signatures on next page)

 

35

 

SIGNATURE PAGE OF BORROWER TO

OPEN END MORTGAGE AND SECURITY AGREEMENT

 

	
   

  	
   

  	
  INLAND AMERICAN
  CUMBERLAND, L.L.C., a 

  Delaware limited liability company 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Inland American Ceruzzi
  Cumberland Member,

  
	
   

  	
   

  	
   

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

  Member 

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  Inland American Cumberland
  Member II, 

  L.L.C., a Delaware limited liability 

  company, Manager

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  Inland American Real
  Estate Trust, 

  Inc., a Maryland corporation, Sole 

  Member

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Valerie Medina

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Valerie Medina

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
  Assistant Secretary

  	
   

  
										

 

STATE OF ILLINOIS             )

COUNTY OF DUPAGE         )

 

In my presence, on
the 5 day of June, 2006, before
me personally appeared Valerie Medina, to me known and known by me to be the Asst. Secretary of Inland
American Real Estate Trust, Inc., a Maryland corporation, on behalf of said
corporation, in its capacity as the sole member of Inland American Cumberland
Member II, L.L.C., a Delaware limited liability company, on behalf of said
limited liability company in its capacity as Manager of Inland American Ceruzzi
Cumberland Member, L.L.C., a Delaware limited liability company, on behalf of
said limited liability company in its capacity as Sole Member of Inland
American Cumberland, L.L.C., a Delaware limited liability company, on behalf of
said limited liability company, and the party executing the foregoing
instrument, and he/she acknowledged said instrument by him/her executed to be
his/her free act and deed, the free act and deed of Inland American Real Estate
Trust, Inc., the free act and deed of Inland American Cumberland Member II,
L.L.C., the free act and deed of Inland American Ceruzzi Cumberland Member,
L.L.C., and the free act and deed of Inland American Cumberland, L.L.C.

 

	
   

  	
  /s/ Rose Marie
  Allred

  	
   

  
	
   

  	
  Notary Public, State of Illinois

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (printed name)

  
	
   

  	
   

  
	
  My commission
  expires:

  	
   

  	
  OFFICIAL SEAL

  ROSE MARIE ALLRED

  NOTARY PUBLIC - STATE OF
  ILLINOIS
MY COMMISSION EXPIRES 06/21/09

  
	
                                         .

  
	
   

  
	
   

  
				

 

36

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