Document:

Exhibit 10.1

 

SECURED SUPER-PRIORITY
POST-PETITION CREDIT AGREEMENT 

 

dated as of August 1, 2017

 

among

 

CAPITOL STATION 65, LLC

 

as Debtor,

 

and

 

SIM T9 INVESTORS, LLC

 

as Lender.

 

     

     

    

 

ANNEXES

 

ANNEX A DEFINITIONS

ANNEX B CLOSING CHECKLIST

ANNEX C REPORTING

ANNEX D NOTICE ADDRESSES

ANNEX E RELEASE PRICE SCHEDULE

 

SCHEDULES

 

SCHEDULE 1.3 BUDGET

SCHEDULE 3.3 INSURANCE POLICIES

SCHEDULE 3.5 EXISTING INDEBTEDNESS

 

EXHIBITS

 

EXHIBIT A FORM OF PROPOSED FINANCING ORDER

EXHIBIT B FORM OF DEED OF TRUST AND ASSIGNMENT
OF RENTS IN FAVOR OF LENDER

 

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This SECURED SUPER-PRIORITY
POST-PETITION CREDIT AGREEMENT (this “Agreement” or “Loan Agreement”), dated as of August
1, 2017 among Capitol Station 65, LLC (the “Debtor” or “Borrower”), currently pending in
the United States Bankruptcy Court for the Eastern District of California, Sacramento Division (the “Bankruptcy Court”),
Case No. 17-23627 (the “Bankruptcy Case”) and SIM T9 Investors, LLC (the “Lender”).

 

RECITALS

 

WHEREAS, on May 30, 2017,
the Debtor filed the Bankruptcy Case.

 

WHEREAS, the Bankruptcy Court
has not yet entered an Order. However, the Debtor has told the U.S. Trustee’s Office that it has requested that the Lender
provide a secured super-priority post-petition revolving credit facility in the amount of Ten Million Dollars ($10,000,000);

 

WHEREAS, the Lender is willing
to make available to the Debtor such post-petition loans upon the terms and subject to the conditions set forth herein;

 

WHEREAS, the Debtor has agreed
to secure the obligations to the Lender hereunder with, inter alia, security interests in, and liens on, substantially all
of the Debtor’s property and assets, whether real or personal, tangible or intangible, now existing or hereafter acquired
or arising (the “Collateral”), all as more fully provided herein; and

 

WHEREAS, capitalized terms
used in this Agreement shall have the meanings ascribed to them herein and in Annex A. All annexes, schedules, exhibits
and other attachments) hereto, or expressly identified to this Agreement, are incorporated herein by reference, and taken together
with this Agreement, shall constitute but a single agreement. These Recitals shall be construed as part of the Agreement.

 

NOW, THEREFORE, in consideration
of the premises and the mutual covenants hereinafter contained, and for other good and valuable consideration, the parties hereto
agree as follows:

 

1.        AMOUNT
AND TERMS OF CREDIT

 

1.1       Credit
Facility.

 

(i)            Revolving
Credit Facility.

 

(i)        Subject
to the terms and conditions hereof, the Lender agrees to make available to the Debtor upon entry of the Financing Order, in substantially
the form attached hereto as Exhibit A, the sum of Ten Million Dollars ($10,000,000), in one or more draws each in a minimum amount
of Five Hundred Thousand Dollars ($500,000) upon not less than seven (7) days’ notice to Lender; provided that the aggregate
disbursements under this Agreement shall not exceed $10,000,000 (the “Loan,” as further defined in Appendix
A hereof), unless otherwise agreed to between the Debtor and the Lender and subject to court approval in the Bankruptcy Case.
Lender also agrees that upon entry of any interim Financing Order (in a form acceptable to Lender), to make available to the Debtor
such sums as approved by the Bankruptcy Court in any such interim Finance Order.

 

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(ii)       The
entire unpaid disbursed balance of the Loan and all other non-contingent obligations shall be immediately due and payable in full
in immediately available funds on the Maturity Date, which is defined in section 6.1 hereof.

 

1.2       Prepayments.

 

(i)        Voluntary
Repayment. The Debtor may at any time without premium or penalty repay the Loan.

 

(ii)       Mandatory
Prepayments. Immediately upon receipt by the Debtor of any insurance or condemnation proceeds or cash proceeds of any asset
disposition, the Debtor shall prepay the Loan in an amount equal to not less than the applicable partial release payments as described
in Section 9.16 below, to be applied to the Loan.

 

(iii)       Application
of Certain Mandatory Prepayments. Any prepayments made by the Debtor shall be applied as follows: first, to any Fees
and reimbursable expenses of Lender then due and payable pursuant to any of the Loan Documents; second, to interest then
due and payable on the Loan; and third, to the principal balance of Loan outstanding until the same has been paid in full.

 

1.3       Use
of Proceeds. The Debtor will not directly or indirectly use the proceeds of the Loan for any purpose other than those set forth
in the Schedule 1.3 (the “Budget”) or to satisfy pre-bankruptcy real property taxes owing to local governmental
authorities.

 

1.4       Interest.

 

(i)        The
Debtor shall pay interest to Lender on the outstanding amount of the Loan, in arrears on the Maturity Date (defined in section
6.1 hereof), at ten percentage points (10%), per annum.

 

(ii)       If
any payment on any Loan becomes due and payable on a day other than a business day, the maturity thereof will be extended to the
next succeeding business day and, with respect to payments of principal, interest thereon shall be payable at the then applicable
rate during such extension.

 

(iii)       All
computations of interest shall be made by Lender on the basis of a 360-day year, in each case for the actual number of days occurring
in the period for which such interest is payable.

 

(iv)      So
long as an Event of Default (as defined in Section 7.1) has occurred and is continuing under Section 7.1 and at the election of
Lender, confirmed by written notice from Lender to the Debtor, the interest rates applicable to the Loan shall be increased by
four percentage points (4%) per annum above the rates of interest otherwise applicable hereunder (the “Default Rate”),
and all outstanding obligations under the Loan shall bear interest at the Default Rate applicable to such outstanding obligations.
Interest at the Default Rate shall accrue from the initial date of such Event of Default until that Event of Default is cured or
waived and shall be payable upon demand.

 

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1.5       Application
and Allocation of Payments. Payments shall be applied to amounts then due and payable in the following order: (1) to Fees and
Lender’s expenses reimbursable hereunder; (2) to interest on the Loan; (3) to principal payments; and (4) to all other obligations,
including expenses of Lender to the extent reimbursable under Section 9.3.

 

1.6       Indemnity.
The Debtor shall indemnify and hold harmless Lender and its affiliates, and each such Person’s respective officers, directors,
employees, attorneys, agents and representatives (each, an “Indemnified Person”), from and against any and all
suits, actions, proceedings, claims, damages, losses, liabilities and expenses (including reasonable attorneys’ fees and
disbursements and other costs of investigation or defense, including those incurred upon any appeal) that may be instituted or
asserted against or incurred by any such Indemnified Person as the result of credit having been extended under this Agreement and
the other Loan Documents and the administration of such credit, and in connection with or arising out of the transactions contemplated
hereunder and thereunder and any actions or failures to act in connection therewith, including any and all Environmental Liabilities,
violations of state/local rules/statues (including habitability) and legal costs and expenses arising out of or incurred in connection
with disputes between or among any parties to any of the Loan Documents; provided, that the Debtor shall not be liable for
any indemnification to an Indemnified Person to the extent that any such suit, action, proceeding, claim, damage, loss, liability
or expense results from that Indemnified Person’s gross negligence or willful misconduct. NO INDEMNIFIED PERSON SHALL BE
RESPONSIBLE OR LIABLE TO ANY OTHER PARTY TO THIS AGREEMENT ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY BENEFICIARY OF SUCH PERSON OR
ANY OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH PARTY, FOR INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH
MAY BE ALLEGED AS A RESULT OF CREDIT HAVING BEEN EXTENDED UNDER ANY LOAN DOCUMENT OR AS A RESULT OF ANY OTHER TRANSACTION CONTEMPLATED
HEREUNDER OR THEREUNDER.

 

2.        CONDITIONS
PRECEDENT

 

2.1       Conditions
to the Loan. The Lender shall not be obligated to make any Loan, or to take, fulfill, or perform any other action hereunder,
until the following conditions have been satisfied or provided for in a manner reasonably satisfactory to Lender, or waived in
writing by Lender:

 

(i)        Credit
Agreement. This Agreement or counterparts hereof shall have been duly executed by, and delivered to all parties hereto; and
Lender shall have received such other documents and instruments, contemplated by this Agreement including all those listed in the
Closing Checklist attached hereto as Annex B, each in form and substance reasonably satisfactory to Lender; and the Deed
of Trust and Assignment of Rents in favor of Lender shall have been recorded with the Sacramento County Recorder and the Security
Agreements and Financing Statements in form satisfactory to Lender shall have been duly filed.

 

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(ii)       Orders.
The entry by the Bankruptcy Court of the Financing Order, substantially in the form attached hereto as Exhibit A
(or any interim Financing Order in a form acceptable to Lender), and, if such order is the subject of any pending appeal, no performance
of any obligation of any party hereto shall have been stayed pending such appeal.

 

3.        REPRESENTATIONS
AND WARRANTIES

 

To induce Lender to make
the Loan, the Debtor makes the following representations and warranties to Lender, each and all of which shall survive the execution
and delivery of this Agreement.

 

3.1       Authority
and Ownership. The Debtor, subject to entry the Financing Order (or any interim Financing Order that may be entered by the
Court), has the requisite power and authority and the legal right to own, pledge, mortgage or otherwise bind the Debtor and encumber
the property of the estate in the Bankruptcy Case pursuant to the terms of this Agreement and the Debtor owns the Collateral.

 

3.2       Government
Regulation. The Debtor is not an “investment company” or an “affiliated person” of, or “promoter”
or “principal underwriter” for, an “investment company,” as such terms are defined in the Investment Company
Act of 1940, or any other federal or state statute that restricts or limits its ability to incur Indebtedness or to perform its
obligations hereunder.

 

3.3       Insurance.
Schedule (3.3) lists all insurance policies of any nature known to the Debtor for current occurrences by the Debtor.

 

3.4       Secured,
Super Priority Obligations.

 

(i)        Subject
to entry of the Financing Order (or any interim financing order), and disbursements of loan proceeds pursuant to the Financing
Order (or interim Financing Order), the provisions of the Loan Agreement and the Orders are effective to create in favor of the
Lender, a legal, valid and perfected Lien on all assets of the Debtor senior to all existing encumbrances on such assets other
than real property taxes owing to Sacramento County up to the amount of $315,544.61, and a legal, valid and perfected security
interest in all right, title and interest in the Collateral senior to all existing encumbrances on the Collateral other than real
property taxes owing to Sacramento County up to the amount of $315,544.61, up to the amount disbursed by Lender. The amounts disbursed
under the Financing Order, attached as Exhibit A, or any interim Financing Order are referred to herein collectively as the “Super-Priority
Indebtedness.”

 

(ii)       Subject
to the Carve-Out, the Super-Priority Indebtedness shall have the status of an expense of administration under 11 U.S.C. §§
503(b)(1) and 363(e), which shall have the priority of § 507(b), senior to all other expenses of administration under §
507(a)(1) and pursuant to 11 U.S.C. § 364(c)(1).

 

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3.5 Prepetition Secured Indebtedness.
To the best of the Debtor’s knowledge, the prepetition secured indebtedness is listed accurately and fully on Schedule 3.5
attached hereto.

 

4.        AFFIRMATIVE
COVENANTS

 

The Debtor agrees that from
and after the date hereof and until the Maturity Date (defined in section 6.1 hereof):

 

4.1       Payment
of Charges.

 

(i)        Except
as non-payment is permitted or payment is prohibited by the Bankruptcy Code or the Bankruptcy Court or subject to Section 4.1(ii),
the Debtor shall pay and discharge or cause to be paid and discharged promptly all Charges payable by the bankruptcy estate, including
(i) Charges imposed upon it, its income and profits, or any of its property (real, personal or mixed) and all Charges with respect
to tax, social security and unemployment withholding with respect to its employees, (ii) lawful claims for labor, materials, supplies
and services or otherwise, and (iii) all storage or rental charges payable to warehousemen or bailees, in each case, before any
thereof shall become past due, except in the case of clauses (ii) and (iii) where the failure to pay or discharge such Charges
would not result in a material breach of this Agreement, as determined in good faith by the Lender.

 

(ii)       The Debtor may in good faith contest, by appropriate proceedings, the validity or amount of any Charges, taxes or claims described
in Section 4.1(i); provided, that (i) adequate reserves with respect to such contest are maintained on its books;
(ii) no Lien shall be imposed to secure payment of such Charges (other than payments to warehousemen and/or bailees) that is superior
to any of the Liens securing the Loans and such contest is maintained and prosecuted continuously and with diligence and operates
to suspend collection or enforcement of such Charges; (iii) none of the Collateral becomes subject to forfeiture or loss as a result
of such contest; and (iv) it shall promptly pay or discharge such contested Charges, taxes or claims and all additional charges,
interest, penalties and expenses, if any, and shall deliver to Lender evidence reasonably acceptable to Lender of such compliance,
payment or discharge, if such contest is terminated or discontinued adversely to the Debtor or the conditions set forth in this
Section 4.1(ii) are no longer met and (v) Lender has not advised the Debtor in writing that
Lender reasonably believes that nonpayment or nondischarge thereof could have or result in a material breach in the Lender’s
good faith judgment.

 

4.2       Books
and Records. The Debtor shall keep adequate books and records with respect to the Debtor’s business activities in which
proper entries, reflecting all financial transactions.

 

4.3       Insurance.
The Debtor shall, at the sole cost and expense of the estate, maintain the policies of insurance described on Schedule (3.3) as
in effect on the date hereof or otherwise in form and amounts and with insurers reasonably acceptable to Lender. The Debtor shall
deliver to Lender, in form and substance reasonably satisfactory to Lender, endorsements to (i) all “All Risk” and
business interruption insurance and (ii) all general liability and other liability policies.

 

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4.4       Reporting.
The Debtor shall timely deliver to the Lender all items set forth on Annex C.

 

4.5       Bankruptcy
Court. The Lender and the Lender’s counsel shall receive all material pleadings, motions
and other documents filed on behalf of the Debtor with the Bankruptcy Court.

 

4.6       Further
Assurances. The Debtor, at the expense of the bankruptcy estate and upon the reasonable request of Lender, will duly execute
and deliver, or cause to be duly executed and delivered, to Lender such further instruments and do and cause to be done such further
acts as may be necessary or proper in the reasonable opinion of Lender to carry out more effectively the provisions and purposes
of this Agreement.

 

5.        NEGATIVE
COVENANTS

 

The Debtor agrees that from
and after the date hereof and until the Maturity Date (defined in section 6.1 hereof):

 

5.1       Indebtedness.
The Debtor shall not create, incur, assume or permit to exist any Indebtedness (defined in Annex A), except (i) Indebtedness outstanding
on the date of disbursement and described on Schedule 3.5, (ii) the Loan, and (iii) any Indebtedness that pays in full the
Loan. The Debtor shall not, directly or indirectly, voluntarily purchase, redeem, defease or prepay any principal of, premium,
if any, interest or other amount payable in respect of any Indebtedness prior to its scheduled maturity.

 

5.2       Liens.
The Debtor shall not create, incur, assume or permit to exist any Lien (defined in Annex A) on or with respect to any property
of the estate (whether now owned or hereafter acquired) except for (a) Permitted Encumbrances; (b) Liens in existence on the date
hereof and summarized on Schedule 3.5 securing the Indebtedness described on Schedule 3.5, extensions and renewals
thereof, including extensions or renewals of any such Liens; provided that the principal amount of the Indebtedness so secured
is not increased and the Lien does not attach to any other property; and (c) Liens arising from loans that pay off all Indebtedness
outstanding under this Loan Agreement.

 

5.3       Hazardous
Materials. The Debtor shall not cause or permit a release of any Hazardous Material on, at, in, under, above, to, from or about
any of the real property of the Debtor (the “Real Property”) where such release would (a) violate in any respect,
or form the basis for any Environmental Liabilities under, any Environmental Laws or Environmental Permits or (b) otherwise adversely
impact the value or marketability of the Collateral, other than such violations or Environmental Liabilities that could not reasonably
be expected to constitute a material breach of this agreement.

 

5.4       Chapter
11 Claims. The Debtor shall not incur, create, assume, suffer to exist or permit any administrative expense, unsecured claim,
or other super-priority claim or lien that is pari passu with or senior to the claims of the Lender against the bankruptcy
estate, or apply to the Bankruptcy Court for authority to do so, except as expressly provided in this Agreement.

 

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5.5       The
Orders. The Debtor shall not make or permit to be made any change, amendment or modification, or any application or motion
for any change, amendment or modification, to the Financing Order without the prior written consent of the Lender.

 

6.        TERM

 

Maturity.
Unless terminated sooner by reason of acceleration or otherwise, payment of the Loan shall be due upon the financing arrangements
contemplated hereby shall be in effect until the earlier of (i) twelve months from the date of entry of the Financing Order, (ii)
or such earlier date (the “Termination Date”) upon which repayment is required due to the occurrence of an Event of
Default (as defined below) (the “Maturity Date”). If there has been no Event of Default under the Loan at any
time since loan commencement (including, without limitation, failure to pay any fees due under the Loan), then upon request made
by Debtor to Lender not less than forty-five (45) days prior to the Maturity Date the Lender shall extend the term of the Loan,
and the Maturity Date, for an additional twelve (12) months conditioned upon Lender receiving such evidence of the continued effect
of Debtor’s representations and warranties made to Lender, without material exception.

 

6.1       Survival
of Obligations. Except as otherwise expressly provided for in this Agreement, no termination or cancellation (regardless of
cause or procedure) of any financing arrangement under this Agreement shall in any way affect or impair the obligations, duties
and liabilities of the Debtor or the rights of Lender relating to any unpaid portion of the Loan, due or not due, liquidated, contingent
or unliquidated, or any transaction or event occurring prior to such termination, or any transaction or event, the performance
of which is required after the Maturity Date. Except as otherwise expressly provided herein, all undertakings, agreements, covenants,
warranties and representations of or binding upon the Debtor , and all rights of Lender shall not terminate or expire, but rather
shall survive any such termination or cancellation and shall continue in full force and effect until the Maturity Date and the
repayment in full of the Loan; provided, that the provisions of Section 9, the payment obligations contained herein, and
the indemnities contained in this Agreement shall survive the Maturity Date.

 

7.        EVENTS
OF DEFAULT; RIGHTS AND REMEDIES

 

7.1       Events
of Default. The occurrence of any one or more of the following events (regardless of the reason therefore) shall constitute
an “Event of Default” hereunder:

 

(i)        The
Debtor fails to make any payment of principal of, or interest on, or Fees owing in respect of the Loan when due and payable.

 

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(ii)       The
Debtor fails or neglects to perform, keep or observe any of the provisions of Sections 1.3 or 5.

 

(iii)      Any
representation or warranty herein or in any written statement, report, financial statement or certificate made or delivered to
Lender is untrue or incorrect in any material respect as of the date when made or deemed made.

 

(iv)      The
Loan Agreement and the Financing Order (or any interim Financing Order) shall, for any reason, cease to create a valid Lien on
the Collateral purported to be covered thereby or such Lien shall cease to be a perfected Lien having the priority provided herein
pursuant to Section 364 of the Bankruptcy Code or the Debtor shall so allege in any pleading filed in any court shall, for any
reason, cease to be valid and binding.

 

(v)       Failure
on the part of the Debtor to observe or perform duly in any material respect any other covenants or agreements on the part of the
Debtor in this Agreement that continue unremedied for a period of 30 days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to the Debtor by Lender (in accordance with Section 9.9 below); provided,
however, that if the same is reasonably capable of being cured within 90 days, but cannot be reasonably cured within 30 days, the
Debtor may cure such event of default by commencing in good faith to cure the default promptly after its receipt of such written
notice and prosecuting the cure of such default to completion with diligence and continuity within a reasonable time thereafter,
but in no event later than 90 days after its receipt of such written notice.

 

(vi)      Any
material non-compliance by the Debtor with any of the terms or provisions of the Financing Order or any interim Financing Order,
including, without limitation, failure to comply with the Budget;

 

(vii)     Entry
of an order by the Bankruptcy Court converting the Bankruptcy Case to a case under Chapter 7 of the Bankruptcy Code or dismissing
the Bankruptcy Case.

 

(viii)    Application
by the Debtor to the Bankruptcy Court or any other court of competent jurisdiction for an order authorizing the granting of any
liens or claims senior to the Lender’s Lien and the Super Priority Indebtedness.

 

(ix)       Filing
by the Debtor of any plan or reorganization other than one incorporating the terms and conditions of this Agreement in their entirety
and providing for payment in full of all obligations.

 

(x)       The
Orders are amended, stayed, vacated, or modified.

 

(xi)       Filing
of any challenge by the Debtor to the validity, priority, or extent of any Liens in favor of the Lender.

 

(xii)     Any
person holding a lien on the Collateral is granted relief from the automatic stay.

 

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7.2      Remedies.

 

(i)        If
any Event of Default has occurred and is continuing, Lender may increase the rate of interest applicable to the Loan to the Default
Rate.

 

(ii)        Subject
to the Bankruptcy Court’s order, if any Event of Default has occurred and is continuing, Lender may: declare all or any portion
of the Loan to be forthwith due and payable or exercise any rights and remedies provided to Lender under this Agreement or at law
or equity, including all remedies provided under the Bankruptcy Code.

 

8.        SUCCESSORS
AND ASSIGNS

 

8.1        Successors
and Assigns. This Agreement shall be binding on and shall inure to the benefit of the Debtor and Lender and their respective
successors and assigns (including, in the case of Debtor, the reorganized debtor), except as otherwise provided herein or therein.
The Debtor may not assign, transfer, hypothecate or otherwise convey its rights, benefits, obligations or duties hereunder without
the prior express written consent of Lender. Any such purported assignment, transfer, hypothecation or other conveyance by the
Debtor without the prior express written consent of Lender shall be void. The terms and provisions of this Agreement are for the
purpose of defining the relative rights and obligations of the Debtor and Lender with respect to the transactions contemplated
hereby and no Person shall be a third party beneficiary of any of the terms and provisions of this Agreement.

 

9.        MISCELLANEOUS

 

9.1       Complete
Agreement; Modification of Agreement. This Agreement constitutes the complete agreement between the parties with respect to
the subject matter thereof and may not be modified, altered or amended except as set forth in Section 9.2.

 

9.2       Amendments
and Waivers. Except for actions expressly permitted to be taken by Lender no amendment, modification, termination or waiver
of any provision of this Agreement, or any consent to any departure by Debtor therefrom, shall in any event be effective unless
the same shall be in writing and signed by Lender and Debtor.

 

9.3       Fees
and Expenses.

 

(i)        Closing
Fee. Subject to entry of the Financing Order attached hereto as Annex A authorizing the Debtor to borrow up to the full amount
of the Loan, upon Loan Maturity, and as a condition of Lender’s release of its security interests, Debtor shall pay Lender
a Basic Loan Fee of Four Hundred Thousand Dollars ($400,000) unless the Maturity Date has been extended pursuant to the terms of
Section 6.1 of this Agreement in which event the Basic Loan Fee shall be Five Hundred Fifty Thousand Dollars ($550,000). In the
event that the Bankruptcy Court authorizes the Debtor to borrow under the terms of this Agreement on an interim basis, but thereafter
denies the Debtor’s request to borrow up to the full amount of the Loan, the Closing Fee shall equal the amount borrowed
by the Debtor multiplied by four (4%) percent.

 

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(ii)       Cancellation
Fee. Promptly after execution of this Agreement, the Debtor shall file a motion asking the Bankruptcy Court to enter the Financing
Order and approve the financing contemplated by this Agreement and make good faith efforts to obtain the Bankruptcy Court’s
approval (“364 Motion”). The Debtor shall pay a fee of One Hundred Thousand ($100,000.00) Dollars to Lender in the
event that: (a) the Debtor withdraws the 364 Motion before the Bankruptcy Court rules on the 364 Motion, or (b) the Debtor seeks
approval from the Bankruptcy Court for debtor-in-possession financing from an alternate lender before the Bankruptcy Court rules
on the 364 Motion. Payment of a cancellation fee shall not be required, however, in the event that the Debtor files the 364 Motion
and makes good faith efforts to obtain the Bankruptcy Court’s approval, but the Bankruptcy Court does not grant said motion
for a reason other than: (a) the Debtor seeks approval from the Bankruptcy Court for debtor-in-possession financing from an alternate
lender, (b) the Debtor withdraws its motion seeking approval this Agreement, or (c) the Debtor and Lender agree to modify the terms
of this Agreement in order to obtain the Bankruptcy Court’s approval of the 364 Motion.

 

9.4       Reimbursement
of Lender Expenses. The Debtor on behalf of the bankruptcy estate shall reimburse Lender for all reasonable fees, costs and
expenses (including the reasonable fees and expenses of all of its counsel, advisors, consultants and auditors) incurred in connection
with the review of Debtor’s Collateral and the negotiation, and preparation of the Loan documents and such expenses for filing
and/or recordation of documents related to the Loan (including the issuance of title insurance) and such other fees and expenses
incurred in connection with:

 

(A)        any
amendment, modification or waiver of, consent with respect to, or termination of, the Loan Agreement;

 

(B)        any
litigation, contest, dispute, suit, proceeding or action (whether instituted by Lender, the Debtor or any other Person and whether
as a party, witness or otherwise) in any way relating to the Collateral, or any other agreement to be executed or delivered in
connection herewith or therewith, including any litigation, contest, dispute, suit, case, proceeding or action, and any appeal
or review thereof, in connection with a case commenced by or against the Debtor or Lender or any other Person that may be obligated
to Lender by virtue of this Agreement; including any such litigation, contest, dispute, suit, proceeding or action arising in connection
with any work-out or restructuring of the Loan during the pendency of one or more Events of Default;

 

(C)        any
attempt to enforce any remedies of Lender under this Agreement, including any such attempt to enforce any such remedies in the
course of any work-out or restructuring of the Loan during the pendency of one or more Events of Default;

 

(D)        efforts
to (i) monitor the Loan or any of the other obligations, (ii) evaluate, observe or assess the Debtor or their respective affairs,
and (iii) verify, protect, evaluate, assess, appraise, collect, sell, liquidate or otherwise dispose of any of the Collateral;

 

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including, as to each of clauses (A) through
(D) above, all reasonable attorneys’ and other professional fees arising from such services and other advice, assistance
or other representation, including those in connection with any appellate proceedings, and all expenses, costs, charges and other
fees incurred by such counsel and others in connection with or relating to any of the events or actions described in this Section
9.4. 

 

Lender shall provide documentation of such
fees and expenses to Debtor, and the Debtor shall have ten (10) business days after receipt of said documentation to dispute the
reasonableness or propriety of the claimed fees and expenses (“Review Period”). Any dispute between the Debtor and
Lender concerning the reasonableness or propriety of the fees and costs will be determined by the Bankruptcy Court. The Debtor
shall reimburse Lender for its fees and costs promptly after expiration of the Review Period unless an objection is timely made.
If an objection is timely made, the Debtor shall reimburse Lender the amount determined by the Bankruptcy Court to be properly
due to Lender under this paragraph.

 

(ii)       Notwithstanding
Section 9.3(i), Lender shall pay costs of compensation required by any broker it retains to negotiate the Indebtedness.

 

9.5       No
Waiver.

 

Lender’s failure, at
any time or times, to require strict performance by the Debtor of any provision of this Agreement shall not waive, affect or diminish
any right of Lender thereafter to demand strict compliance and performance herewith or therewith. Any suspension or waiver of an
Event of Default shall not suspend, waive or affect any other Event of Default whether the same is prior or subsequent thereto
and whether the same or of a different type. Subject to the provisions of Section 9.2, none of the undertakings, agreements,
warranties, covenants and representations of Debtor contained in this Agreement and no Event of Default by the Debtor shall be
deemed to have been suspended or waived by Lender, unless such waiver or suspension is by an instrument in writing signed by an
officer of or other authorized employee of Lender and directed to the Debtor specifying such suspension or waiver.

 

9.6       Remedies.
Lender’s rights and remedies under this Agreement shall be cumulative and nonexclusive of any other rights and remedies that
Lender may have, by operation of law or otherwise. Recourse to the Collateral shall not be required.

 

9.7       Severability.
Wherever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable
law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective
only to the extent of such prohibition or invalidity without invalidating the remainder of such provision or the remaining provisions
of this Agreement.

 

    	 	13	 

     

    

 

9.8       Governing
Law. Except as otherwise expressly provided in this agreement, in all respects, including all matters of construction, validity
and performance, this agreement and the obligations shall be governed by, and construed and enforced in accordance with, the internal
laws of the State of California applicable to contracts made and performed in that state and any applicable laws of the United
States of America. The Debtor and the Lender hereby consent and agree that the Bankruptcy Court shall have exclusive jurisdiction
to hear and determine any claims or disputes pertaining to this agreement or to any matter arising out of or relating to this agreement.

 

9.9       Notices.
Except as otherwise provided herein, whenever it is provided herein that any notice, demand, request, consent, approval, declaration
or other communication shall or may be given to or served upon any of the parties by any other parties, or whenever any of the
parties desires to give or serve upon any other parties any communication with respect to this Agreement, each such notice, demand,
request, consent, approval, declaration or other communication shall be in writing and shall be deemed to have been validly served,
given or delivered: (a) upon the earlier of actual receipt and three (3) business days after deposit in the United States mail,
registered or certified mail, return receipt requested, with proper postage prepaid; (b) upon transmission, when sent by telecopy
or other similar facsimile transmission (with such telecopy or facsimile promptly confirmed by delivery of a copy by personal delivery
or United States Mail as otherwise provided in this Section 9.8); (c) one (1) business day after deposit with a reputable
overnight courier with all charges prepaid or (d) when delivered, if hand-delivered by messenger, all of which shall be addressed
to the party to be notified and sent to the address or facsimile number indicated in Annex D or to such other address (or
facsimile number) as may be substituted by notice given as herein provided. The giving of any notice required hereunder may be
waived in writing by the party entitled to receive such notice. Failure or delay in delivering copies of any notice, demand, request,
consent, approval, declaration or other communication to any Person (other than the Debtor or Lender) designated in Annex D
to receive copies shall in no way adversely affect the effectiveness of such notice, demand, request, consent, approval, declaration
or other communication.

 

9.10     Section
Titles. The Section titles contained in this Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement between the parties hereto.

 

9.11     Counterparts.
This Agreement may be executed in any number of separate counterparts, each of which shall collectively and separately constitute
one agreement.

 

9.12     Reinstatement.
This Agreement shall continue to be effective or to be reinstated, as the case may be, if at any time payment and performance of
the Loan, or any part thereof, is, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored or
returned by any obligee of the Loan, whether as a “voidable preference,” “fraudulent conveyance,” or otherwise,
all as though such payment or performance had not been made. In the event that any payment, or any part thereof, is rescinded,
reduced, restored or returned, the Loan shall be reinstated and deemed reduced only by such amount paid and not so rescinded, reduced,
restored or returned.

 

9.13     Advice
of Counsel. Each of the parties represents to each other party hereto that it has discussed this Agreement.

 

    	 	14	 

     

    

 

9.14     No
Strict Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the
event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the
parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship
of any provisions of this Agreement.

 

9.15     Option
to Convert to Post-Confirmation Financing. The Debtor shall be permitted to incorporate this Agreement into any Chapter 11
plan it may propose so long as such plan does not alter or affect any of the terms and conditions of this Agreement or any rights
granted to Lender under the Financing Order. In the event the Debtor does so, notwithstanding Bankruptcy Code section 1129(a),
the Debtor shall not be required to repay the Loan in full on the effective date of its confirmed plan of reorganization if such
effective date occurs prior to the Maturity Date.

 

9.16     Partial
Release. ANNEX E of this Agreement sets forth allocated prices per parcel of the Real Property based upon an appraisal prepared
in March 2016. So long as Debtor is not in default, Lender upon Debtor’s request shall instruct the trustee under the deed
of trust in favor of Lender to release one or more designated parcels upon payment to Lender of an amount equal to the Release
Price Ratio reflected in ANNEX E for the parcel(s) sold multiplied by the then outstanding amount of the Loan. For example, only,
if Debtor designated that Parcel 4 was to be released at a time when the Loan balance was $5,000,000, then the release price would
be $323,500.00 (6.47% x $5,000,000 = $323,500.00). If the Debtor thereafter sold Parcel 13 at a time when the Loan balance was
$7,500,000, then the release price would be $804,272.51 (10.72% x $7,500,000 = $804,272.51). In the event all parcels are sold
prior to the Maturity Date, the release price for the last parcel shall equal all outstanding amounts then due under the Loan.

 

Upon sale of each parcel, the Loan available to
be drawn upon by Debtor shall be permanently reduced by the Release Price Ratio reflected in ANNEX E for the parcel(s) sold multiplied
by $10,000,000. Again, for example only, if the Debtor sold Parcel 4, the Loan commitment would be correspondingly be reduced by
$646,651.27 (6.47% x $10,000,000 = $646,651.27). If the Debtor then sold Parcel 13, the Loan commitment would be reduced by an
additional $1,072,363.36 (10.72% x $10,000,000 = $1,072,363.36).

 

[Remainder of page intentionally left blank.]

 

    	 	15	 

     

    

 

IN WITNESS WHEREOF, this
Agreement has been duly executed as of the date first written above.

 

BORROWER:

 

Capitol Station 65,
LLC, a California limited liability company

 

By: Capitol Station Member, LLC, a Delaware limited liability company,
its Manager

By: Capitol Station Holdings, LLC, a California limited liability
company, its Manager

By: Township Nine Owner, LLC, a Delaware limited liability company,
its Member

By: First Capital Real Estate Operating Partnership, L.P., a Delaware
limited partnership, its Manager

By: First Capital Real Estate Trust, Incorporated, a Maryland corporation,
its General Partner

 

	By:	/s/ Suneet Singal	 
	Name:	Suneet Singal	 
	Title:	Chief Executive Officer, Treasurer, Secretary and Chairman of the Board of Directors of First Capital Real Estate Trust Incorporated

 

LENDER:

 

SIM T9 INVESTORS, LLC

 

as Lender

 

	By:	Serene Investment Management, LLC, Its Managing Member
	 	 	 
	By:	/s/ Adam Phillips	 
	Name:	Adam Phillips	 
	Title:	Managing Member of Serene Investment Management, LLC

 

    	 	16	 

     

    

  

ANNEX A 

to

CREDIT AGREEMENT

 

DEFINITIONS

 

Capitalized terms used in
this Loan Agreement shall have (unless otherwise provided elsewhere in the Loan Documents) the following respective meanings, and
all references to Sections, Exhibits, Schedules or Annexes in the following definitions shall refer to Sections, Exhibits, Schedules
or Annexes of or to the Agreement:

 

“Avoidance
Actions” means any and all claims arising under section 549 of the Bankruptcy Code.

 

“Carve-Out”
means: (i) all fees required to be paid to the clerk of the Bankruptcy Court, any agent thereof and to the Office of the United
States Trustee under section 1930(a) of title 28 of the United States Code plus interest at the statutory rate; (ii) fees and expenses
incurred by a trustee under section 726(b) of the Bankruptcy Code in an amount not to exceed $50,000; (iii) to the extent allowed
by the Bankruptcy Court, all claims for unpaid fees, costs and expenses (the “Professional Fees”) incurred by persons
or firms retained by the Borrower or any official committee of unsecured creditors that may be appointed in the Debtors Cases (the
“UCC”) whose retention is approved by the Bankruptcy Court pursuant to sections 327, 328 and 1103 of the Bankruptcy
Code (collectively, the “Professional Persons”) that are: (A) based upon services rendered at any time prior to the
occurrence of an Event of Default unless such Event of Default is waived or cured as provided in the DIP Loan Agreement, or (B)
after the occurrence and during the continuation of an Event of Default, if any, in an aggregate amount not to exceed $200,000.
As long as no Event of Default shall have occurred and be continuing, the Borrower shall be permitted to pay all fees, expenses,
compensation and reimbursement of expenses allowed and payable, including under any order entered in the Cases establishing procedures
for interim monthly compensation and reimbursement of Professional Fees, or sections 330 and 331 of the Bankruptcy Code, as the
same may be due and payable, and the same shall not reduce the Carve-Out. In the event the Carve-Out is reduced by any amount during
an Event of Default, upon the effectiveness of a cure of such Event of Default, the Carve Out shall be increased by such amount.
Nothing herein shall be construed to impair the ability of any party to object to the fees, expenses, reimbursement or compensation
described in clauses (i), (ii) or (iii) above, on any grounds.

 

“Charges”
means all federal, state, county, city, municipal, local, foreign or other governmental taxes, levies, assessments, charges, liens,
claims or encumbrances upon or relating to (a) the Collateral or (b) the obligations.

 

“Closing Checklist”
means the schedule, including all appendices, exhibits or schedules thereto, listing certain documents and information to be delivered
in connection with the Agreement, the other Loan Documents and the transactions contemplated thereunder, substantially in the form
attached hereto as Annex B.

 

    	 	A-1	 

     

    

 

“Collateral”
means all property of this bankruptcy estate, real or personal, tangible or intangible, and Avoidance Actions now existing or hereafter
acquired, and all proceeds therefrom; provided, however, that claims arising under sections 544, 545, 547, 548 of the Bankruptcy
Code and under similar state laws are excepted from the Lender’s Collateral and do not secure the Loan.

 

“Environmental Laws”
means all applicable federal, state, local and foreign laws, statutes, ordinances, codes, rules, standards and regulations, now
or hereafter in effect, and any applicable judicial or administrative interpretation thereof, including any applicable judicial
or administrative order, consent decree, order or judgment, imposing liability or standards of conduct for or relating to the regulation
and protection of human health, safety, the environment and natural resources (including ambient air, surface water, groundwater,
wetlands, land surface or subsurface strata, wildlife, aquatic species and vegetation). Environmental Laws include the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980 (42 U.S.C. §§ 9601 et seq.) (“CERCLA”);
the Hazardous Materials Transportation Authorization Act of 1994 (49 U.S.C. §§ 5101 et seq.); the Federal Insecticide,
Fungicide, and Rodenticide Act (7 U.S.C. §§ 136 et seq.); the Solid Waste Disposal Act (42 U.S.C. §§ 6901
et seq.); the Toxic Substance Control Act (15 U.S.C. §§ 2601 et seq.); the Clean Air Act (42 U.S.C. §§
7401 et seq.); the Federal Water Pollution Control Act (33 U.S.C. §§ 1251 et seq.); the Occupational Safety
and Health Act (29 U.S.C. §§ 651 et seq.); and the Safe Drinking Water Act (42 U.S.C. §§ 300(f)
et seq.), and any and all regulations promulgated thereunder, and all analogous state, local and foreign counterparts or
equivalents and any transfer of ownership notification or approval statutes.

 

“Environmental Liabilities”
means, with respect to any Person, all liabilities, obligations, responsibilities, response, remedial and removal costs, investigation
and feasibility study costs, capital costs, operation and maintenance costs, losses, damages, punitive damages, property damages,
natural resource damages, consequential damages, treble damages, costs and expenses (including all reasonable fees, disbursements
and expenses of counsel, experts and consultants), fines, penalties, sanctions and interest incurred as a result of or related
to any claim, suit, action, investigation, proceeding or demand by any Person, whether based in contract, tort, implied or express
warranty, strict liability, criminal or civil statute or common law, including any arising under or related to any Environmental
Laws, Environmental Permits, or in connection with any Release or threatened Release or presence of a Hazardous Material whether
on, at, in, under, from or about or in the vicinity of any real or personal property.

 

“Environmental Permits”
means all permits, licenses, authorizations, certificates, approvals or registrations required by any governmental authority under
any Environmental Laws.

 

    	 	A-2	 

     

    

 

“Hazardous Material”
means any substance, material or waste that is regulated by, or forms the basis of liability now or hereafter under, any Environmental
Laws, including any material or substance that is (a) defined as a “solid waste,” “hazardous waste,” “hazardous
material,” “hazardous substance,” “extremely hazardous waste,” “restricted hazardous waste,”
“pollutant,” “contaminant,” “hazardous constituent,” “special waste,” “toxic
substance” or other similar term or phrase under any Environmental Laws, or (b) petroleum or any fraction or by-product thereof,
asbestos, polychlorinated biphenyls (PCB’s), or any radioactive substance.

 

“Indebtedness”
means, with respect to any Person, without duplication, (a) all indebtedness of such Person for borrowed money or for the deferred
purchase price of property and (b) all Indebtedness referred to above secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien upon or in property or other assets (including accounts
and contract rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness,
and (i) the obligations.

 

“Lien”
means any mortgage or deed of trust, pledge, hypothecation, assignment, deposit arrangement, lien, charge, claim, security interest,
easement or encumbrance, or preference, priority or other security agreement or preferential arrangement of any kind or nature
whatsoever (including any lease or title retention agreement, any financing lease having substantially the same economic effect
as any of the foregoing, and the filing of, or agreement to give, any financing statement perfecting a security interest under
the Code, as defined herein in Appendix A or comparable law of any jurisdiction)

 

“Loan”
means all loans, advances, debts, liabilities and obligations for the performance of covenants, tasks or duties or for payment
of monetary amounts (whether or not such performance is then required or contingent, or such amounts are liquidated or determinable)
owing by the Debtor on behalf of the Debtor to Lender, and all covenants and duties regarding such amounts, of any kind or nature,
present or future, whether or not evidenced by any note, agreement, or other instrument, arising under the Agreement.

 

“Permitted Encumbrances”
means the following encumbrances: (a) Liens for taxes or assessments or other governmental Charges not yet due and payable or which
are being contested in accordance with Section 4.2(b); (b) pledges or deposits of money securing statutory obligations under
workmen’s compensation, unemployment insurance, social security or public liability laws or similar legislation; (c) pledges
or deposits of money securing bids, tenders, contracts (other than contracts for the payment of money) or leases to which Debtor
is a party as lessee made in the ordinary course of business; (d) inchoate and unperfected workers’, mechanics’ or
similar liens arising in the ordinary course of business; (e) deposits securing, or in lieu of, surety, appeal or customs bonds
in proceedings to which Debtor is a party; (f) zoning restrictions, easements, licenses, or other restrictions on the use of the
Real Property or other minor irregularities in title (including leasehold title) thereto, so long as the same do not materially
impair the use, value, or marketability of such Real Property; (g) presently existing or hereafter created Liens in favor of Lender;
and (h) subject to entry of the Orders, presently existing or hereafter created Liens in favor of the prepetition lender, which
Liens are subordinate to the Liens in favor of the Lender.

 

    	 	A-3	 

     

    

 

“Person”
means any individual, sole proprietorship, partnership, joint venture, trust, unincorporated organization, association, corporation,
limited liability company, institution, public benefit corporation, other entity or government (whether federal, state, county,
city, municipal, local, foreign, or otherwise, including any instrumentality, division, agency, body or department thereof).

 

Wherever from the context it appears appropriate,
each term stated in either the singular or plural shall include the singular and the plural, and pronouns stated in the masculine,
feminine or neuter gender shall include the masculine, feminine and neuter genders. The words “including”, “includes”
and “include” shall be deemed to be followed by the words “without limitation”; the word “or”
is not exclusive; references to Persons include their respective successors and assigns (to the extent and only to the extent permitted
by the Agreement) or, in the case of governmental Persons, Persons succeeding to the relevant functions of such Persons; and all
references to statutes and related regulations shall include any amendments of the same and any successor statutes and regulations.
Whenever any provision in the Agreement refers to the knowledge (or an analogous phrase) of the Debtor , such words are intended
to signify that he or it has actual knowledge or awareness of a particular fact or circumstance or, if it had exercised reasonable
diligence, would have known or been aware of such fact or circumstance.

 

    	 	A-4	 

     

    

 

ANNEX B 

to

CREDIT AGREEMENT

 

CLOSING CHECKLIST.

 

In addition to, and not in limitation of, the
conditions described in Section 2.1 of the Agreement, the following items must be received by Lender in form and substance
satisfactory to Lender on or prior to the Closing Date (each capitalized term used but not otherwise defined herein shall have
the meaning ascribed thereto in Annex A to the Agreement), unless such requirement is waived in writing by the Lender:

 

A.       Appendices.
All Appendices to the Agreement, in form and substance satisfactory to Agent.        .

 

B.        Insurance.
Satisfactory evidence that the insurance policies required by Section 4.3 are in full force and effect and delivery of such
endorsements described therein.

 

C.        Title
Insurance. At the expense of the Debtor, an ALTA loan title insurance policy issued by [TITLE COMPANY] to the Lender, having
a liability in the amount of the Loan, and insuring, as of the time and date that the Deed of Trust is recorded that fee title
to the Real Estate is vested in the Debtor and that the lien of the Deed of Trust is a valid first priority Lien on the Real Estate,
subject only to those Liens and exceptions as permitted herein and the Bankruptcy Court Order and containing such endorsements
as Lender shall reasonably require.

 

D.        Authority.
The Order of the Bankruptcy Court and of the U.S. Trustee’s duly appointing assigned Case No. 17-23630.

 

    	 	B-1	 

     

    

 

ANNEX C

 

to

CREDIT AGREEMENT

 

REPORTING

 

The Debtor shall deliver
or cause to be delivered to Lender, as indicated, the following:

 

(a)       Default
Notices. To Lender, as soon as practicable, and in any event within five (5) Business Days after the Debtor has actual knowledge
of the existence of any Default, Event of Default or other event that has had a Material Adverse Effect, telephonic or telecopied
notice specifying the nature of such Default or Event of Default or other event, including the anticipated effect thereof, which
notice, if given telephonically, shall be promptly confirmed in writing on the next Business Day.

 

(b)       Insurance
Notices. To Lender, disclosure of losses or casualties received by the Debtor from the Debtor’s insurers.

 

(c)       Other
Documents. To Lender, such other financial and other information respecting Debtor’s business or financial condition
as Lender shall from time to time reasonably request.

 

    	 	C-1	 

     

    

 

ANNEX D 

CREDIT AGREEMENT

 

NOTICE ADDRESSES

 

If to Lender:

Serene Investment Management, LLC

c/o 366 Development, LLC

Attn: Adam Phillips

3065 Rosecrans Place, Suite 205

San Diego, California 92110

(Tel.) 619-955-5777

Email: adam.phillips@366development.com

 

With copy to:

Randy Michelson

Michelson Law Group

220 Montgomery Street, Suite 2100

San Francisco, CA 94104

(Tel.) 415-512-8600

Email: randy.michelson@michelsonlawgroup.com

 

If to Debtor:

Capitol Station 65, LLC

c/o First Capital Real Estate Trust, Inc.

Attn: Suneet Singal

60 Broad Street, 34th Floor

New York, NY 10004

(Tel.) 212-388-6800

Email: s@firstcapitalre.com

 

With copy to:

 

Greg Nuti/Kevin W. Coleman

Nuti Hart LLP

411 30th Street, Suite 408

Oakland, CA 94609

(Tel.) 510 506-7153

Email: gnuti@nutihart.com

 kcoleman@nutihart.com

 

    	 	D-1	 

     

    

 

ANNEX E 

to

CREDIT AGREEMENT

 

RELEASE PRICE SCHEDULE

 

	TMParcel No	 	Lot Size (Net 
 Developable 
 Acres)	 	 	Appraised Value	 	 	Release Price Ratio	 
	1	 	 	5.08	 	 	$	12,590,000	 	 	 	19.38	%
	3A	 	 	0.94	 	 	$	2,589,052	 	 	 	3.99	%
	3B	 	 	1.38	 	 	$	3,800,948	 	 	 	5.85	%
	4	 	 	1.14	 	 	$	4,200,000	 	 	 	6.47	%
	5A	 	 	1.02	 	 	$	3,230,000	 	 	 	4.97	%
	5B	 	 	2.13	 	 	$	2,425,000	 	 	 	3.73	%
	6A	 	 	1.09	 	 	$	1,861,536	 	 	 	2.87	%
	6B	 	 	1.4	 	 	$	2,390,964	 	 	 	3.68	%
	7A	 	 	1.06	 	 	$	1,135,149	 	 	 	1.75	%
	7B	 	 	0.95	 	 	$	1,017,351	 	 	 	1.57	%
	8A	 	 	0.84	 	 	$	1,008,000	 	 	 	1.55	%
	8B	 	 	0.82	 	 	$	984,000	 	 	 	1.52	%
	10A	 	 	0.86	 	 	$	2,243,093	 	 	 	3.45	%
	10B	 	 	1.18	 	 	$	3,069,907	 	 	 	4.73	%
	12A	 	 	0.85	 	 	$	1,301,235	 	 	 	2.00	%
	12B	 	 	0.79	 	 	$	1,206,765	 	 	 	1.86	%
	13	 	 	2.44	 	 	$	6,965,000	 	 	 	10.72	%
	14	 	 	1.94	 	 	$	4,750,000	 	 	 	7.31	%
	15A	 	 	0.51	 	 	$	481,800	 	 	 	0.74	%
	15B	 	 	0.49	 	 	$	462,906	 	 	 	0.71	%
	15C	 	 	0.7	 	 	$	661,294	 	 	 	1.02	%
	16A	 	 	0.55	 	 	$	608,418	 	 	 	0.94	%
	16B	 	 	0.49	 	 	$	542,045	 	 	 	0.83	%
	16C	 	 	0.73	 	 	$	807,537	 	 	 	1.24	%
	17	 	 	2.24	 	 	$	4,618,000	 	 	 	7.11	%
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	31.62	 	 	$	64,950,000.00	 	 	 	100	%

 

    	 	E-1	 

     

    

 

Schedule 1.3 

to

CREDIT AGREEMENT

 

BUDGET

 

[omitted from service copy, see Exh. C to
Motion]

 

    	 	1	 

     

    

 

Schedule 3.3 

to

CREDIT AGREEMENT

 

INSURANCE POLICIES

 

	Type of Coverage	 	Carrier	 	Policy No.	 	Exp. Date
	 	 	 	 	 	 	 
	Casualty/Property Replacement	 	Great American Insurance Co.	 	MAC E215869 00 00	 	3/1/2018
	 	 	 	 	 	 	 
	General Liability	 	Associated Industries Insurance Co.	 	AES1044535 00	 	1/25/2018
	 	 	 	 	 	 	 
	Excess Liability	 	Aspen American Insurance Co.	 	CX0057517	 	1/25/2018
	 	 	 	 	 	 	 
	Worker’s Compensation	 	N/A	 	 	 	 
	 	 	 	 	 	 	 
	Disability	 	N/A	 	 	 	 

 

    	 	2	 

     

    

 

Schedule 3.5 

to

CREDIT AGREEMENT

 

EXISTING LIENS

 

	Lienholder	 	Indebtedness 
 (approx. as of 5/30/2017	 
	 	 	 	 
	Sacramento County, the City of Sacramento, the American River Flood Control District, and/or the Richards Boulevard Assessment District for general and/or special tax assessments on the Township Nine parcels1	 	$	315,000.00	 
	 	 	 	 	 
	Township Nine Avenue, LLC (assignee of COPIA Lending, LLC)	 	$	43,739,412.00
 (amount disputed)
	 
	 	 	 	 	 
	The Growing Company, Inc.	 	$	20,349.00	 
	 	 	 	 	 
	Teichert Construction	 	$	228,462.38	 
	 	 	 	 	 
	Studebaker Brown Elec., Inc.	 	$	33,343.41	 

 

 

 

		1	The APNs and street addresses for the relevant parcels
comprising Township Nine are: 001-0020-056/601 Vine Street; 001-0020-057/649 Vine Street; 001-0020-058/640 Vine Street; 001-0020-060/601
Township 9 Ave.; 001-0020-061/641 Township 9 Ave.; 001-0020-062/629 Richards Blvd; 001-0020-063/503 Riverine Wy; 001-0020-064/611
Riverine Wy; 001-0020-066/424 N. 5th St.; 001-0020-067/819 N. 7th St.

 

    	 	3	 

     

    

 

EXHIBIT A 

to

CREDIT AGREEMENT

 

FINANCING ORDER

 

[omitted from service copy, see Exh. A to
Motion]

 

    	 	4	 

     

    

 

EXHIBIT B 

to

CREDIT AGREEMENT

 

DEED OF TRUST

 

[begins on next page]

 

    	 	5	 

     

    

 

Recording Requested By

And When Recorded Mail To:

SERENE INVESTMENT MANAGEMENT, LLC

c/o 366 Development LLC

3065 Rosecrans Place, Suite 205

San Diego, California 92110

 

 

 

DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE
FILING WITH ASSIGNMENT OF RENTS AND LEASES

 

THIS DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING WITH
ASSIGNMENT OF RENTS AND LEASES (this “Deed of Trust”) is made and given as of August ____2017, by CAPITOL
STATION 65, a California limited liability company, as (“Trustor”), having its principal place of business
at 2355 Gold Meadow Way, Ste. 160, Gold River, California 95670-4443, to FIDELITY NATIONAL TITLE COMPANY, (the “Trustee”),
having an address at 601 California Street, Suite 1501, San Francisco, California 94108 (Attention Rita Lin) , for the benefit
of SERENE INVESTMENT MANAGEMENT, LLC, a California limited liability company (“Beneficiary”), having
its principal place of business at 3065 Rosecrans Place, Suite 205, San Diego, California 92110

 

I.           GRANTS
AND OBLIGATIONS SECURED

 

A.         Grants.

 

1.01         LAND.
Trustor hereby irrevocably grants, transfers and assigns to Trustee, in trust, with power of sale and right of entry and possession,
all right, title and interest of Trustor, now owned or hereafter acquired, in and to that certain real property situated in the
City of Sacramento, County of Sacramento, State of California and more particularly described on Exhibit A attached hereto
and incorporated herein by reference (the “Land”), together with all right, title and interest of Trustor in and to:

 

(a)       Improvements.
All buildings and other improvements now or hereafter located on the Land, all water and water rights (whether riparian, appropriative,
or otherwise, and whether or not appurtenant), pumps and pumping stations used in connection therewith and all shares of stock
evidencing the same, all machinery, equipment, appliances, furnishings, inventory, fixtures and other property used or usable in
connection with the Land and the improvements thereon, including, but not limited to, all storage tanks and pipelines, all gas,
electric, heating, cooling, air conditioning, refrigeration and plumbing fixtures and equipment, which have been or may hereafter
be attached or affixed in any manner to any building now or hereafter located on the Land (the “Improvements”);

 

(b)       Rights
of Way. All the rights, rights of way, easements, licenses, profits, privileges, tenements, hereditaments and appurtenances,
now or hereafter in any way appertaining and belonging to or used in connection with the Land and/or the Improvements, and any
part thereof or as a means of access thereto, including, but not limited to, any claim at law or in equity, and any after acquired
title and reversion in or to each and every part of all streets, roads, highways and alleys adjacent to and adjoining the same;

 

    	 	6	 

     

    

 

(c)       Income.
All rentals, earnings, income, deposits, security deposits, receipts, royalties, revenues, issues and profits which, after the
date hereof, and while any portion of the indebtedness and obligations secured hereby remain outstanding, may accrue from the Land
and/or the Improvements and any part thereof, subject to a license in favor of Trustor to collect and use the same prior to an
Event of Default (as defined below) as provided herein;

 

(d)       Leasehold
Estates. All leasehold estates and all leases and subleases covering the Land and/or the Improvements or any portion thereof
or interest therein now or hereafter existing or entered into; and

 

(e)       Deposits.
All deposits made with or other security given to utility companies by Trustor with respect to the Land and/or the Improvements,
and all advance payments of insurance premiums made by Trustor with respect thereto and claims or demands relating to insurance.

 

  Any of the foregoing
arising or acquired by Trustor on and after the date hereof, including without limitation the property described in subparagraphs (a),
(b), (c), (d) and (e) of this Paragraph 1.01 are collectively defined hereinafter as the “Property.” 

 

1.02        COLLATERAL.
Trustor hereby grants a security interest to Beneficiary in all of Trustor’s right, title and interest in and to the Property
(to the extent such Property is deemed to be personal property under the Uniform Commercial Code from time to time in effect in
the State of California) and the following described property and any and all products and proceeds thereof, now owned or hereafter
acquired by Trustor (sometimes all of such being collectively referred to herein as the “Collateral”), and this Deed
of Trust shall accordingly constitute a security agreement as defined in the California Uniform Commercial Code:

 

(a)       Tangible
Property. All existing and future goods and tangible personal property located on the Property or wherever located and used
or usable in connection with the use, operation or occupancy of the Property or in construction of the Improvements, including,
but not limited to, all appliances, furniture and furnishings, fittings, inventory, materials, supplies, equipment and fixtures,
and all building material, supplies, and equipment now or hereafter delivered to the Property and installed or used or intended
to be installed or used therein whether stored on the Property or elsewhere; and all renewals or replacements thereof or articles
in substitution thereof;

 

(b)       General
Intangibles. All general intangibles relating to design, development, operation, management and use of the Property or construction
of the Improvements, including, but not limited to: (i) all names under which or by which the Property or the Improvements
may at any time be operated or known, all rights to carry on business under any such names or any variant thereof, and all goodwill
in any way relating to the Property; (ii) all permits, licenses, authorizations, variances, land use entitlements, approvals
and consents issued or obtained in connection with the construction of the Improvements; (iii) all permits, licenses, approvals,
consents, authorizations, franchises and agreements issued or obtained in connection with the use, occupancy or operation of the
Property; (iv) all materials prepared for filing or filed with any governmental agency in connection with the Property or
the Improvements; (v) all rights under any contract in connection with the development, design, use, operation, management
and construction of the Property; and (vi) all payment intangibles;

 

    	 	7	 

     

    

 

(c)       Contracts.
All construction, service, engineering, consulting, architectural and other similar contracts of any nature (including, without
limitation, those of any general contractors, subcontractors and materialmen), as such may be modified, amended or supplemented
from time to time, concerning the design, construction, management, operation, occupancy, use, and/or disposition of any portion
of or all of the Property;

 

(d)       Leases.
All leases for space in the Improvements to the extent such leases are deemed to be personal property;

 

(e)       Plans
and Reports. All architectural drawings, plans, specifications, soil tests and reports, feasibility studies, appraisals, engineering
reports and similar materials relating to any portion of or all of the Property;

 

(f)        Sureties.
All payment and performance bonds or guarantees and any and all modifications and extensions thereof relating to the Property;

 

(g)       Payments.
All reserves, deferred payments, deposits, refunds, cost savings, letters of credit and payments of any kind relating to the construction,
design, development, operation, occupancy, use and disposition of all or any portion of the Property;

 

(h)       Financing
Commitments. All proceeds of any commitment by any lender to extend permanent or construction financing to Trustor relating
to the Property;

 

(i)        Claims.
All proceeds and claims arising on account of any damage to or taking of the Property or any part thereof, and all causes of action
and recoveries for any loss or diminution in the value of the Property;

 

(j)        Insurance.
All policies of, and proceeds resulting from, insurance relating to the Property or any of the above collateral, and any and all
riders, amendments, extensions, renewals, supplements or extensions thereof, and all proceeds thereof;

 

(k)       Stock.
All shares of stock or other evidence of ownership of any part of the Property that is owned by Trustor in common with others,
including all water stock relating to the Property, if any, and all documents or rights of membership in any owners’ or members’
association or similar group having responsibility for managing or operating any part of the Property;

 

(l)        Proceeds.
All proceeds, whether cash, promissory notes, contract rights or otherwise, of the sale or other disposition of all or any part
of the estate of Trustor pertaining to the Property now or hereafter existing thereon;

 

    	 	8	 

     

    

  

(m)       Sale
Contracts. All sales contracts, escrow agreements and broker’s agreements concerning the sale of any or all of the Property;

 

including, without limiting the above items,
all Accounts, Chattel Paper, Deposit Accounts, Documents, General Intangibles, Goods, Instruments, Inventory, Investment Properties,
Letter of Credit Rights, Money, Payment Intangibles, Proceeds and Supporting Obligations as those terms are defined in the Uniform
Commercial Code from time to time in effect in the State of California (“California Commercial Code”).

 

The personal property in which Beneficiary has
a security interest includes goods which are or shall become fixtures on the Property, other than any trade fixtures and personal
property owned by tenants or occupants other than the Trustor or persons owned or controlled by the Trustor who occupy all or a
portion of the Property pursuant to leases or occupancy agreements. This Deed of Trust is intended to serve as a fixture filing
pursuant to the terms of Sections 9334 and 9502 of the California Commercial Code. This filing is to be recorded in the real
estate records of the county in which the Property is located. In that regard, the following information is provided:

 

	Name of Debtor:	Capitol Station 65, LLC
	 	 
	Address of Debtor:	See Paragraph 6.11 hereof
	 	 
	Name of Secured Party:	Serene Capital Management, LLC
	 	 
	Address of Secured Party:	See Paragraph 6.11 hereof

 

1.03       MINERAL
RIGHTS. Trustor hereby assigns and transfers to Beneficiary all damages, royalties and revenue of every kind, nature and description
whatsoever that Trustor may be entitled to receive from any person or entity owning or having or hereafter acquiring a right to
the oil, gas or mineral rights and reservations of the Property, with the right, but not obligation, in Beneficiary: (a) to
receive and receipt therefor, and apply the same to the indebtedness and obligations secured hereby; and (b) the right, but
not obligation, to demand, sue for and recover any such payments; provided, however, so long as there shall exist no Event of Default,
Trustor shall have the right to collect and retain such payments and exercise all rights in connection therewith.

 

		B.	Obligations Secured.

 

1.04       The
grants, assignments and transfers made in Paragraphs 1.01, 1.02 and 1.03 and Article II hereof are given for the purpose of
securing, in such order of priority as Beneficiary may determine:

 

(a)       Payment
of the indebtedness evidenced by the Secured Super Priority Post-Petition Credit Agreement of even date herewith and any renewals,
extensions, modifications or amendments thereof, in the stated principal amount of Ten Million Dollars ($10,000,000) (the “Loan
Agreement”), executed by Trustor and payable to Beneficiary, together with interest thereon and late charges as provided
by the Loan Agreement, which is made a part hereof by reference;

 

    	 	9	 

     

    

 

(b)       Payment
of such further sums as Trustor or any successor in ownership hereafter may borrow from Beneficiary when evidenced by a note or
notes, or other instrument, reciting it is so secured, payable to Beneficiary or order and made by Trustor or any successor in
ownership, and all renewals, extensions, modifications or amendments of such note or notes;

 

(c)       Payment
and performance of each and every obligation of Trustor contained herein;

 

(d)       Payment
and performance of each and every other obligation of Trustor contained in the Credit Agreement; and

 

(e)       Performance
of each agreement of Trustor contained in any other agreement which is for the purpose of further securing any indebtedness or
obligation secured hereby, except for (i) any separate environmental indemnity agreement and (ii) any separate guaranty, which
documents expressly are not secured by this Deed of Trust. Upon written request from Beneficiary, Trustor shall deliver an executed
promissory note to Beneficiary further evidencing the indebtedness set forth in the Loan Agreement.

 

		II.	COVENANTS OF TRUSTOR

 

		A.	Condition and Operation of Property.

 

2.01       MAINTENANCE
AND PRESERVATION. Trustor: (a) shall maintain, keep and preserve the Property in good condition and repair; (b) shall
complete promptly and in a good and workmanlike manner any Improvement which may be now or hereafter constructed on the Property
and, provided Beneficiary makes insurance proceeds, if any, available to Trustor pursuant to Paragraph 2.05 below, promptly
restore in like manner any Improvement which may be damaged or destroyed thereon from any cause whatsoever and, subject to Paragraph 2.07
below, pay when due all valid claims for labor performed and materials furnished therefor; (c) shall not commit or permit any waste
or deterioration of the Property; (d) shall keep and maintain abutting sidewalks, alleys, roads and parking areas in good
and neat order and repair to the extent owned by Trustor or to the extent Trustor is otherwise so required by applicable law; (e) shall
not take (or fail to take) any action, which if taken (or not so taken) would increase in any way the risk of fire or other hazard
occurring to or affecting the Property or otherwise would materially impair the security of Beneficiary in the Property; (f) shall
not abandon the Property or any portion thereof or leave the Property unprotected, unguarded, vacant or deserted; (g) shall
not, without the prior written consent of Beneficiary, initiate, join in or consent to any change in any zoning ordinance, general
plan, specific plan, private restrictive covenant or other public or private restriction limiting the uses which may be made of
the Property by Trustor or by the owner thereof; and (h) shall secure and maintain in full force and effect all permits necessary
for the use, occupancy and operation of the Property.

 

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2.02       COMPLIANCE
WITH LAWS. Trustor shall comply with all decisions, statutes, ordinances, rulings, directions, rules, regulations, orders,
writs, decrees, injunctions, permits, certificates, or other requirements of any court or other governmental authority (collectively
“Legal Requirement”) now or hereafter affecting the Property or any part thereof or requiring any alteration or improvement
to be made thereon or thereto. Trustor shall not commit, suffer or permit any act to be done in, upon or to the Property or any
part thereof in violation of any such Legal Requirement. Notwithstanding the foregoing, Trustor shall have the right to contest
the imposition of any Legal Requirement affecting the Property provided that (a) such contest is made in good faith and diligently
prosecuted by Trustor to completion; (b) no action for the sale of, or the foreclosure of any lien against, the Property arising
from or relating to such Legal Requirement shall have been commenced, or if such action shall have been commenced, Trustor shall
have provided a good and sufficient undertaking as may be required or permitted by law to accomplish a stay of any such sale or
foreclosure; and (c) such contest shall not impair the security of Beneficiary in the Property or adversely affect the operation
of the Property or Trustor’s business.

 

2.03       BOOKS
AND RECORDS. Trustor shall maintain, or cause to be maintained, in the State of California, proper and accurate books, records
and accounts reflecting all items of income and expense in connection with the operation of the Property or in connection with
any services, equipment or furnishings provided in connection with the operation of the Property. Upon three (3) days prior
written notice to Trustor, Beneficiary, or its designee, shall have the right from time to time during normal business hours to
examine such books, records and accounts and to make copies or extracts therefrom.

 

2.04       INSURANCE.
Trustor shall at all times maintain insurance policies that comply with the insurance requirements of the Loan Agreement. The Trustor
hereby irrevocably appoints the Beneficiary as its true and lawful attorney-in-fact, with full power of substitution to assign
any policy in the event of the transfer of the Property to the Trustee pursuant to this Deed of Trust.

 

2.05       CASUALTY;
CASUALTY NOTICE; INSURANCE PROCEEDS. After the happening of any casualty or event insured against under Section 2.04 or the
Loan Agreement, Trustor shall give prompt written notice thereof to the Beneficiary. The proceeds of any casualty insurance and
rent loss insurance shall be applied in accordance with the Loan Agreement.

 

    	 	11	 

     

    

 

2.06       ASSIGNMENT
OF PROCEEDS. Trustor hereby absolutely and unconditionally assigns to Beneficiary all insurance proceeds which it may be entitled
to receive and such proceeds shall be delivered to and held by Beneficiary to be applied to Beneficiary’s expenses in settling,
prosecuting or defending any insurance claim, and then to the restoration of any portion of the Property and/or the Collateral
that has been damaged or destroyed to the same condition, character and value as existed prior to such damage or destruction so
long as the following conditions are satisfied: (a) no Event of Default shall have occurred; (b) Beneficiary’s
security is not impaired; and (c) in the event that in Beneficiary’s reasonable judgment the insurance proceeds are
not sufficient to accomplish restoration, Trustor deposits with Beneficiary, within fifteen (15) days of demand by Beneficiary,
the additional amounts necessary to accomplish restoration. Proceeds disbursed for restoration will be released to Trustor pursuant
to disbursement procedures reasonably determined by Beneficiary in accordance with customary construction loan disbursement procedures.
In the event any of the conditions set forth above are not satisfied, Beneficiary shall have the option to either apply the insurance
proceeds upon any indebtedness secured hereby (but the same shall not be deemed a pre-payment) in such order as Beneficiary may
determine or release such proceeds to Trustor without such release being deemed a payment of any indebtedness secured hereby, rather
than to apply such proceeds to the restoration of the Property and/or the Collateral. Such application or release shall not cure
or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. If the Property and/or
the Collateral is restored at a cost less than the available insurance proceeds, then the excess may, at Beneficiary’s election,
be applied by Beneficiary to any indebtedness secured hereby in such order as Beneficiary may determine (but the same shall not
be deemed a pre-payment). Following an Event of Default, Beneficiary may commence, appear in, defend or prosecute any assigned
claim or action, and may adjust, compromise, settle and collect all claims, proceeds and awards assigned to Beneficiary, but shall
not be responsible for any failure to collect any claim, proceeds or award, regardless of the cause of the failure.

 

		B.	Payments.

 

2.07       LOAN.
Trustor shall pay the principal, interest and any other charges or amounts due under the Loan Agreement and this Deed of Trust
(collectively, together with all other documents executed by Trustor at Beneficiary’s request in connection therewith, the
“Loan Documents”) according to their terms.

 

2.08       LIENS.
Other than Permitted Encumbrances, Trustor shall pay and promptly discharge when due, at Trustor’s cost and expense, all
liens, encumbrances and charges upon the Property or any part thereof or interest therein; provided that the existence of any mechanic’s,
laborer’s, materialman’s, supplier’s or vendor’s lien or right thereto shall not constitute a violation
of this Paragraph 2.08 if payment is not yet due under the contract which is the foundation thereof. Trustor shall have the
right to contest in good faith the validity of any such lien, encumbrance or charge, provided Trustor shall either expunge said
Lien or deposit in the manner required by applicable law, a bond or other security in the statutorily-required amount and release
said Lien from the Property, and provided further that Trustor shall thereafter diligently proceed to cause such lien, encumbrance
or charge or be removed and discharged. If Trustor shall fail either to remove and discharge any such lien, encumbrance or charge
or to deposit security in accordance with the preceding sentence, if applicable, then, in addition to any other right or remedy
of Beneficiary hereunder or under any of the other Loan Documents, Beneficiary may, but shall not be obligated to, discharge the
same, without inquiring into the validity of such lien, encumbrance or charge nor into the existence of any defense or offset thereto,
either by paying the amount claimed to be due, or by procuring the discharge of such lien, encumbrance or charge by depositing
in a court a bond or the amount claimed or otherwise giving security for such claim, or in such manner as is or may be prescribed
by law. Trustor shall, within five (5) days of demand therefor by Beneficiary, pay to Beneficiary an amount equal to all costs
and expenses incurred by Beneficiary in connection with the exercise by Beneficiary of the foregoing right to discharge any such
lien, encumbrance or charge, together with interest thereon from the date such amounts are due and payable by Trustor at the Default
Rate, and such sums shall be secured hereby.

 

    	 	12	 

     

    

 

2.09       TAXES
AND IMPOSITIONS. (a) Trustor shall pay, or cause to be paid prior to delinquency, all real property taxes and assessments,
general and special, and all other taxes and assessments of any kind or nature whatsoever accruing after May 30, 2017 including,
without limitation, non-governmental levies or assessments such as maintenance charges, levies or charges resulting from covenants,
conditions and restrictions affecting the Property which are assessed or imposed upon the Property, or upon Trustor as owner or
operator of the Property, and which create or may create a lien upon the Property, or any part thereof, or upon any personal property,
equipment or other facility used in the operation or maintenance thereof (all of the above collectively referred to as “Impositions”);
provided, however, that if, by law, any such Imposition is due and payable, or may at the option of the taxpayer be paid, in installments,
Trustor may pay the same or cause it to be paid, together with any accrued interest on the unpaid balance of such Imposition, in
installments as the same become due and before any fine, penalty, interest or cost may be added thereto for the nonpayment of any
such installment and interest.

 

(b)       Subject
to the provisions of Paragraph 2.09(c), Trustor shall deliver to Beneficiary within thirty (30) days after the date upon
which any such Imposition is due and payable by Trustor, official receipts of the appropriate taxing authority, or other proof
reasonably satisfactory to Beneficiary, evidencing the payment thereof.

 

(c)       Trustor
shall have the right before any delinquency occurs to or object to the amount or validity of any such Imposition by appropriate
legal proceedings, but this shall not be deemed or construed in any way as relieving, modifying or extending Trustor’s covenant
to pay any such Imposition at the time and in the manner provided herein, unless Trustor has given prior written notice to Beneficiary
of Trustor’s intent to so contest or object to an Imposition, and unless (i) Trustor shall demonstrate to Beneficiary’s
reasonable satisfaction that the legal proceedings shall conclusively operate to prevent the sale of the Property, or any part
thereof, to satisfy such Imposition prior to final determination of such proceedings; or (ii) Trustor shall demonstrate to
Beneficiary’s reasonable satisfaction that Trustor has provided a good and sufficient undertaking as may be required or permitted
by law to accomplish a stay of any such sale.

 

(d)       All
Impositions accruing up to and including May 30, 2017 shall be paid pursuant to the terms of Trustor’s anticipated Chapter
11 plan of reorganization (“Plan”).

 

2.10       Reserved

 

2.11       UTILITIES.
Trustor shall pay or shall cause to be paid when due all utility charges which are incurred for the benefit of the Property or
which may become a charge or lien against the Property for gas, electricity, water, or sewer services furnished to the Property
and all other assessments or charges of a similar nature, whether public or private, affecting the Property or any portion thereof,
whether or not such taxes, assessments or charges are or may become liens thereon. Notwithstanding the foregoing, any such utility
charges accruing up to and including May 30, 2017 shall be paid pursuant to the Plan.

 

    	 	13	 

     

    

 

2.12       REIMBURSEMENT.
Trustor shall pay all reasonable out-of-pocket sums expended or expenses incurred by Trustee or Beneficiary under any of the terms
of this Deed of Trust, including without limitation, any reasonable fees and expenses (including without limitation reasonable
attorneys’ fees and expenses) incurred in connection with any reconveyance of the Property or any portion thereof, or to
compel payment under Loan Documents in connection with any default thereunder, including, without limitation, reasonable attorneys’
fees, costs and expenses incurred in any bankruptcy or judicial or nonjudicial foreclosure proceeding, with interest from date
such amounts are due and payable by Trustor at the Default Rate, and said sums shall be secured hereby.

 

Lender shall provide documentation of such
fees and expenses to Debtor, and the Debtor shall have ten (10) business days after receipt of said documentation to dispute the
reasonableness or propriety of the claimed fees and expenses (“Review Period”). Any dispute between the Debtor and
Lender concerning the reasonableness or propriety of the fees and costs will be determined by the Bankruptcy Court. The Debtor
shall reimburse Lender for its fees and costs promptly after expiration of the Review Period unless an objection is timely made.
If an objection is timely made, the Debtor shall reimburse Lender the amount determined by the Bankruptcy Court to be properly
due to Lender under this paragraph.

 

2.13       BENEFICIARY’S
STATEMENT FEE. Trustor shall pay the reasonable amount demanded by Beneficiary or its authorized servicing agent for any statement
regarding the obligations secured hereby; provided, however, that such amount may not exceed the maximum amount allowed by law
at the time request for the statement is made.

 

		C.	Condemnation; Eminent Doman.

 

2.14       If
the Property, or any part thereof, is taken or damaged by reason of any public improvement or condemnation proceeding, or in any
other similar manner, Beneficiary shall be entitled to all compensation, awards and other payments or relief therefor to which
Trustor shall be entitled, and shall be entitled at its option, following an Event of Default, to commence, appear in and prosecute
in its own name any action or proceeding or to make any compromise or settlement in connection with such taking or damage to the
extent of the interests of Trustor therein, but Beneficiary shall not be responsible for any failure to collect any claim or award,
regardless of the cause of the failure, except to the extent caused by the gross negligence or willful misconduct of Beneficiary.
Trustor hereby absolutely and unconditionally assigns to Beneficiary all such compensation, awards, damages, rights of action and
proceeds to which Trustor shall be entitled (the “Proceeds”) and Beneficiary shall, after deducting therefrom all its
reasonable out-of-pocket expenses, including, but not limited to attorneys’ fees, apply or release the Proceeds with the
same effect and as provided in Paragraph 2.06 above with respect to disposition of insurance proceeds. Trustor agrees to execute
such further assignments of the Proceeds as Beneficiary or Trustee may reasonably require.

 

    	 	14	 

     

    

 

		D.	Rents and Leases.

 

2.15       ASSIGNMENT
OF RENTS AND LEASES. In addition to any other grant, transfer or assignment effectuated hereby, and without in any manner limiting
the generality of the grants in Article I hereof, Trustor hereby transfers and assigns to Beneficiary, as security for the indebtedness
and obligations secured hereby, all of Trustor’s rights, title, and interest in and to: (a) all current and future leases
between Trustor and any of the lessees (collectively, the “Lessees”) of any portion of the Property and all amendments,
modifications, renewals and/or extensions thereof; (b) any guaranties of the Lessees’ obligations under any such leases,
modifications, amendments, renewals and/or extensions; and (c) all rents, income, receipts, accounts, equitable and contract
rights, security deposits, issues and profits however arising from the Property (collectively, the “Rents”). Each of
said leases, together with all such modifications, amendments, renewals, extensions, guaranties and Rents shall be hereinafter
referred to singularly as a “Lease” and collectively as the “Leases”. Such assignment constitutes a present
absolute, irrevocable assignment to Beneficiary of all of Trustor’s rights, title and interest in and to the Leases (which
term includes but is not limited to the Rents from the Property). So long as there shall exist no Event of Default, Trustor shall
have the right to collect all Rents from the Property and to retain, use and operate the same.

 

2.16       RESERVED.

 

2.17       RESERVED.

 

2.18       RESERVED.

 

2.19       RESERVED.

 

		E.	Other Rights and Obligations.

 

2.20       ASSIGNMENT
OF CONTRACTS. In addition to any other grant, transfer or assignment effectuated hereby and without in any manner limiting
the generality of the grants in Article I hereof, Trustor shall assign to Beneficiary, as security for the indebtedness and
obligations secured hereby, Trustor’s interest in all agreements, contracts, licenses and permits affecting the Property
in any manner whatsoever, such assignments to be made, if so requested by Beneficiary, by instruments in a form satisfactory to
Beneficiary; but no such assignment shall be construed as a consent by Beneficiary to any agreement, contract, license or permit
so assigned, or to impose upon Beneficiary any obligations with respect thereto.

 

2.21       PRESERVATION
OF PROPERTY AND COLLATERAL. Trustor shall do any and all acts which, from the character or use of the Property or the Collateral,
may be reasonably necessary to protect and preserve the lien, the priority of the lien and the security of Beneficiary granted
herein, the specific enumerations herein not excluding the general.

 

2.22       MORTGAGE
TAX. In the event of the passage, after the date of this Deed of Trust, of any law deducting from the material value of the
Property or the Collateral for the purpose of taxation any lien thereon, or changing in any way the laws now in force for the taxation
of deeds of trust or debts secured by deeds of trust, or the manner of the collection of any such taxes, so as to affect this Deed
of Trust, or imposing payment of the whole or any portion of any taxes, assessments or other similar charges against the Property
or the Collateral upon Beneficiary, the indebtedness secured hereby shall immediately become due and payable at the option of Beneficiary;
provided, however, that such election by Beneficiary shall be ineffective if such law either: (a) shall neither impose a tax
upon Beneficiary, nor increase any tax now payable by Beneficiary; or (b) shall impose a tax upon Beneficiary or increase
any tax now payable by Beneficiary, and prior to the due date of such tax assessment or other similar change: (i) Trustor
is permitted by law and can become legally obligated to pay such tax or the increased portion thereof (in addition to all interest,
additional interest and other charges payable hereunder without exceeding the applicable limits imposed by the usury laws of the
State of California); (ii) Trustor does pay such tax or increased portion; and (iii) Trustor agrees with Beneficiary
in writing to pay, or reimburse Beneficiary for the payment of, any such tax or increased portion thereof when thereafter levied
or assessed against the Property or the Collateral or any portion thereof. The obligations of Trustor under such agreement shall
be secured hereby.

 

    	 	15	 

     

    

 

2.23       ATTORNEYS’
FEES. Upon election of Beneficiary or Trustee so to do, employment of an attorney is authorized and Trustor shall pay all attorneys’
fees, costs and expenses in connection with any action and/or actions (including without limitation the cost of evidence
or search of title), which may be brought for the foreclosure of this Deed of Trust, and/or for possession of the Property covered
hereby, and/or for the appointment of a receiver, and/or for the enforcement of any covenant or right in this Deed of Trust shall
be secured hereby, and Trustor shall reimburse Beneficiary for any payments made by Beneficiary therefor within five (5) days
of demand by Beneficiary, together with interest thereon from the date such amounts are due and payable by Trustor at the Default
Rate, and such sums shall be secured hereby.

 

2.24       TRANSFER
OF PROPERTY; RIGHT TO DECLARE OBLIGATIONS DUE ON TRANSFER. Trustor covenants and agrees that except as may be otherwise expressly
provided by the terms of the Loan Documents there shall be no transfer of all or any portion of the Land or the Property without
the prior written consent of Beneficiary. Consent to one such transaction shall not be deemed to be a waiver of Beneficiary’s
right to require its separate written consent to future or successive transactions. Beneficiary may grant or deny such consent
in its sole and absolute discretion; and if such consent is given, any such transfer shall be subject to this Deed of Trust and
the other Loan Documents, and any such transferee shall assume all obligations of the transferee hereunder and under the other
Loan Documents and agree to be bound by all provisions contained herein and therein (subject to any exculpation provisions provided
therein), and Trustor and such transferee shall comply in all other aspects with any requirements set forth in the Loan Documents
relating to such transfer and shall furnish Beneficiary with such documentation and opinions of counsel as Beneficiary may reasonably
request in connection with such transfer and assumption. Such assumption shall not, however, release Trustor or any other party
from any liability to Beneficiary hereunder or under any other Loan Document except as otherwise expressly agreed in writing by
Beneficiary. As used herein, a “transfer” of the Property shall include (a) any sale, agreement to sell, transfer
or conveyance of the Property, or any portion thereof or interest therein, whether voluntary, involuntary, by operation of law
or otherwise, or the lease of all or any portion of the Property, other than a Lease entered into by Trustor in accordance with
the terms and conditions of this Deed of Trust; (b) except to the extent of any mineral or other subsurface rights presently
held by third parties as of the date of this Deed of Trust, the use of any part of the surface, or subsurface to a depth of 500 feet
below the surface, of the Land for the prospecting for, drilling for, production (including injection and other producing or withdrawal
operations), mining, extraction, storing or removal of any oil, gas or other minerals whether from the Land or elsewhere; (c) any
sale, transfer, hypothecation, assignment, pledge or conveyance, of any interest, in whole or in part, whether direct or indirect,
voluntary, involuntary, by operation of law or otherwise in Trustor or any entity which directly or indirectly controls an interest
in Trustor; (d) any transfer by way of security, including the placing or the permitting of the placing of any mortgage, deed
of trust, assignment of rents or other security device on the Land or Improvements or any part thereof; and (e) any other
encumbrance of the Property, except as expressly permitted hereunder or under the other Loan Documents. This covenant shall run
with the Land and remain in full force and effect until all of the indebtedness secured hereby is paid in full, and Beneficiary
may, without notice to Trustor, deal with any transferees with reference to the indebtedness secured hereby in the same manner
as with Trustor, without in any way altering or discharging Trustor’s liability hereunder or the indebtedness secured hereby
or the liability of any guarantor with respect thereto. Upon the occurrence of any transfer without the prior written consent of
Beneficiary, Beneficiary may, at its option, declare all indebtedness and obligations secured hereby to be immediately due and
payable without any presentment, demand, protest or notice of any kind. In the event that Beneficiary does not elect to declare
such indebtedness and obligations immediately due and payable, then, unless expressly released in writing by Beneficiary, Trustor
shall nevertheless remain primarily liable for all such indebtedness and obligations. This provision shall apply to each and every
sale, transfer, hypothecation, encumbrance, pledge, assignment or conveyance, regardless whether or not Beneficiary has consented
to, or waived, Beneficiary’s rights hereunder, whether by action or non-action in connection with any previous sale, transfer,
hypothecation, encumbrance, pledge, assignment or conveyance.

 

    	 	16	 

     

    

 

2.25       PROTECTION
OF SECURITY. At the time upon the occurrence of an Event of Default and in the manner herein provided, Beneficiary, or Trustee
upon written instructions from Beneficiary (the legality thereof to be determined solely by Beneficiary), may, without notice to
or demand upon Trustor, without releasing Trustor from any obligation hereunder and without waiving its right to declare a default
as herein provided or impairing any declaration of default or election to cause the Property to be sold or any sale proceeding
predicated thereon:

 

(a)       Take
action in such manner and to such extent as either may deem necessary to protect the security hereof, Beneficiary and Trustee being
authorized to enter upon and take possession of the Property and/or the Collateral for such purposes;

 

(b)       Commence,
appear in and/or defend any action or proceedings purporting to affect the security hereof, and/or any additional or other security
therefor, the interests, rights, powers and/or duties of Trustee and/or Beneficiary hereunder, whether brought by or against Trustor,
Trustee or Beneficiary;

 

(c)       Pay,
purchase, contest or compromise any claim, debt, lien, charge or encumbrance which in the judgment of either may affect or appear
to affect the security and/or priority of this Deed of Trust, the interest of Beneficiary or the rights, powers and/or duties of
Trustee and/or Beneficiary hereunder; and

 

    	 	17	 

     

    

 

(d)       By
itself or by its agents to be appointed by it for that purpose or by a receiver appointed by a court of competent jurisdiction
to enter into and upon and take and hold possession of any portion or all of the Property and/or the Collateral both real and personal,
and exclude Trustor and all other persons therefrom; and to operate and manage the Property and/or the Collateral and rent and
lease the same, perform such reasonable acts of repair or protection as may be reasonably necessary or proper to conserve the value
thereof, and collect any and all income, Rents, issues, profits and proceeds therefrom, the same being hereby assigned and transferred
to Beneficiary for the benefit and protection of Beneficiary, and from time to time apply and/or accumulate such income, Rents,
issues, profits and proceeds in such order and manner as Beneficiary or such receiver in its sole discretion shall consider advisable,
to or upon the following: the expense of receivership, if any, the proper costs of upkeep, maintenance, repair and/or operation
of the Property and/or the Collateral, the repayment of any sums theretofore or thereafter advanced pursuant to the terms of this
Deed of Trust upon the indebtedness and obligations secured hereby, the taxes and assessments upon the Property and/or Collateral
then due or next to become due. The collection and/or receipt of income, Rents, issues, profits and/or proceeds by Beneficiary,
its agent or receiver, after declaration of default and election to cause the Property to be sold under and pursuant to the terms
of this Deed of Trust shall not affect or impair such default or declaration of default or election to cause the Property to be
sold or any sale proceedings predicated thereon, but such proceedings may be conducted and sale effected notwithstanding the receipt
and/or collection of any such income, Rents, issues, profits and/or proceeds. Any such income, Rents, issues, profits and/or proceeds
in the possession of Beneficiary, its agent or receiver, at the time of sale and not theretofore applied as herein provided, shall
be applied in the same manner and for the same purposes as the proceeds of the sale.

 

Neither Trustee nor Beneficiary shall be under
any obligation to make any of the payments or do any of the acts referred to in this Paragraph 2.28 and any of the actions
referred to in this Paragraph 2.28 may be taken by Beneficiary upon the occurrence of an Event of Default irrespective of
whether any notice of default or election to sell has been given hereunder and without regard to the adequacy of the security for
the indebtedness secured hereby.

 

2.26       FINANCING
AND CONTINUATION STATEMENT, AMENDMENTS, ATTORNEY IN FACT. Trustor hereby authorizes the Beneficiary to file one or more financing
or continuation statements, and amendments thereto, relating to all or any part of the Collateral without the signature of Trustor
where permitted by law. A photocopy or other reproduction of this Deed of Trust or any financing statement covering the Collateral
or any part thereof shall be sufficient as a financing statement where permitted by law. Trustor hereby irrevocably appoints the
Beneficiary as Trustor’s attorney-in-fact, with full authority in the place and stead of Trustor and in the name of Trustor
or otherwise, from time to time in the Beneficiary’s discretion, to take any action and to execute any instrument which the
Beneficiary may deem necessary or advisable to accomplish the purposes of the security interest granted by Trustor herein.

 

2.27       FURTHER
ASSURANCES. Trustor agrees to execute such documents and take such action as Beneficiary shall reasonably determine to be necessary
or desirable to further evidence, perfect or continue the perfection and/or the priority of the lien and security interest granted
by Trustor herein.

 

2.28       NOTICES
TO TRUSTOR. Trustor shall comply with and promptly furnish to Beneficiary true and complete copies of any notices pertaining
to the Property by any governmental authority of the United States, the State of California, or any other political subdivision
in which the Property is located or which exercises jurisdiction over Trustor, and/or the Property. Trustor shall promptly notify
Beneficiary of any fire or other casualty or any notice of taking or eminent domain proceeding affecting the Property.

 

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		III.	DEFAULTS AND REMEDIES

 

		A.	Defaults.

 

3.01       EVENTS
OF DEFAULT. Each of the following shall constitute an “Event of Default” for purposes of this Deed of Trust:

 

(a)       The
failure by Trustor to make any payment according to the terms, tenor, and effect of this Deed of Trust or of the Exhibits hereto,
including, but not limited to, any payment of insurance premiums, penalties, taxes, payments in lieu of taxes, charges, etcetera,
in each case within fifteen (15) days after receipt of written notice from the Beneficiary after the same shall become due and
payable, whether at maturity, by acceleration, or otherwise;

 

(b)       Except
as otherwise provided herein, the failure of Trustor to promptly and accurately perform any other covenant or agreement contained
in this Deed of Trust and the Exhibits hereto, or in the Loan Agreement or any of the other Loan Documents, and the additional
failure to cure or remedy such within a period of thirty (30) days after written notice thereof; provided, however, that if such
failure cannot be remedied in such time, the Trustor shall have an additional thirty (30) days to remedy such failure as long as
the Trustor commences efforts to cure within thirty (30) days and, in the reasonable determination of the Beneficiary, diligently
and in good faith pursues such cure or remedy;

 

(c)       Any
representation, warranty or certificate given or furnished by or on behalf of Trustor shall prove to be false as of the date on
which the representation, warranty or certification was given; provided, however, that if any representation, warranty or certification
which proves to be false is due to the Trustor’s inadvertence (as reasonably determined by the Beneficiary), the Trustor
shall have a thirty (30) day opportunity, after written notice thereof, to cause such representation, warranty or certification
to be full, true, and complete in every respect;

 

(d)       Trustor
fails to pay any amount due under or pursuant to, or to perform any obligation required by or arising from the Loan Agreement or
any other Loan Document and such failure continues uncured beyond any applicable grace period provided for therein or, in the absence
of any such grace period, beyond a period of thirty (30) days following written notice of such failure by Beneficiary to Trustor;

 

(e)       Other
than the Bankruptcy Case, Trustor shall file, or have filed against it, a petition of bankruptcy, insolvency or similar action
pursuant to state or federal law, or shall file any petition or answer seeking, consenting to, or acquiescing in, any reorganization,
arrangement, readjustment, liquidation, dissolution or similar relief, and such petition shall not have been vacated within sixty
(60) calendar days after filing; or shall be adjudicated bankrupt or insolvent, under any present or future statute, law, regulation,
either state or federal, and such judgment or decree is not vacated or set aside within sixty (60) calendar days after such determination;

 

    	 	19	 

     

    

 

(f)       Trustor
shall make an assignment for the benefit of creditors, or shall submit in writing its inability to pay its debts generally as they
become due;

 

(g)       Other
than pursuant to the Bankruptcy Case, Trustor consents to, or acquiesces in, the appointment of a receiver, liquidator, or trustee
of itself or of the whole or any substantial part of its properties or assets;

 

(h)       Other
than in the Bankruptcy Case, a court of competent jurisdiction enters an order, judgment or decree appointing a receiver, liquidator
or trustee of the Trustor, of the whole or any substantial part of the property or assets of the Trustor, and such order, judgment
or decree shall remain unvacated or not set aside or unstayed for sixty (60) calendar days;

 

(i)       Any
attachment, execution or other lien, whether voluntary or involuntary, including mechanics liens, is filed against the Property
and is not discharged or dissolved by a bond within sixty (60) days;

 

(j)       Other
than those existing on the Closing Date, a default shall occur with respect to any other loan secured by the Property or any other
part of the Property that is not cured within any applicable cure period; and

 

(k)       Trustor
otherwise fails to comply with the terms of this Deed of Trust, the Loan Agreement or any other Loan Document and such failure
continues uncured for a period of thirty (30) days following written notice thereof by Beneficiary to Trustor.

 

		B.	Remedies.

 

3.02       ACCELERATION
AND FORECLOSURE. Upon the occurrence of an Event of Default hereunder, then and in each such event, Beneficiary may declare
all sums secured hereby immediately due and payable either by commencing an action to foreclose this Deed of Trust as a mortgage,
or by the delivery to Trustee of a written declaration of default and demand for sale and of written notice of default and of election
to cause the Property to be sold, which notice Trustee shall cause to be duly filed for record in case of foreclosure by exercise
of the power of sale herein. Should Beneficiary elect to foreclose by exercise of the power of sale herein, Beneficiary shall also
deposit with Trustee this Deed of Trust, and such receipts and evidence of expenditures made and secured hereby as Trustee may
require, and notice of sale having been given as then required by law and after lapse of such time as may then be required by law
after recordation of such notice of default, Trustee, without demand on Trustor, shall sell the Property at the time and place
of sale fixed by it in said notice of sale, either as a whole or in separate parcels, and in such order as it may determine, at
public auction to the highest bidder for cash in lawful money of the United States, payable at time of sale. Trustee may postpone
sale of all or any portion of the Property by public announcement at such time and place of sale, and from time to time thereafter
may postpone such sale by public announcement at the time fixed by the preceding postponement. Trustee shall deliver to such purchaser
its deed or deeds conveying the Property, or any portion thereof, so sold, but without any covenant or warranty, express or implied.
The recitals in such deed or deeds of any matters or facts shall be conclusive proof of the truthfulness thereof. Any person, including
Trustor, Trustee or Beneficiary may purchase at such sale.

 

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3.03       RESCISSION
OF NOTICE. Beneficiary, from time to time before Trustee’s sale, may rescind any such notice of breach or default and
of election to cause the Property to be sold by executing and delivering to Trustee a written notice of such rescission, which
notice, when recorded, shall also constitute a cancellation of any prior declaration of default and demand for sale. The exercise
by Beneficiary of such right of rescission shall not constitute a waiver of any breach or default then existing or subsequently
occurring, or impair the right of Beneficiary to execute and deliver to Trustee, as above provided, other declarations of default
and demand for sale, and notices of breach or default, and of election to cause the Property to be sold to satisfy the obligations
hereof, nor otherwise affect any provision, agreement, covenant or condition of this Deed of Trust or any of the rights, obligations
or remedies of the parties hereunder.

 

3.04       PROCEEDS
OF SALE. After deducting all costs, fees and expenses of Trustee and of Trustee’s foreclosure under this Deed of Trust,
including but not limited to the cost of appraisal and evidence of title in connection with sale and attorneys’ fees, Trustee
shall apply the proceeds of sale to payment of: all sums expended under the terms hereof, not then repaid, with accrued interest
at the Default Rate; all other sums then secured hereby; and the remainder, if any, to the person or persons legally entitled thereto.

 

3.05       OTHER
SECURITY. If Beneficiary at any time holds additional security for any obligations secured hereby, it may enforce the terms
hereof or otherwise realize upon the same, at its option, either before or concurrently herewith or after a sale is made hereunder,
and may apply the proceeds upon the indebtedness secured hereby without affecting the status of or waiving any right to exhaust
all or any other security, including the security hereunder, and without waiving any breach or default or any right or power whether
exercised hereunder or contained herein or in any such other security.

 

3.06       REMEDIES
CUMULATIVE. No remedy herein conferred upon or reserved to Trustee or Beneficiary is intended to be exclusive of any other
remedy herein or by law provided or permitted, but each shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute. Every power or remedy given by this instrument to Trustee
or Beneficiary or to which any of them may be otherwise entitled may be exercised concurrently or independently, from time to time
and as often as may be deemed expedient by Trustee or Beneficiary, and any of them may pursue inconsistent remedies.

 

3.07       Reserved

 

		IV.	COLLATERAL

 

4.01       BENEFICIARY’S
RIGHTS AS A SECURED PARTY. With respect to the security interest granted under Paragraph 1.02 hereof, Beneficiary shall
have all the rights and remedies granted to a secured party under Division 9 of the California Commercial Code (including without
limitation the right to conduct a unified sale of all or any portion of the Property and the Collateral) as well as all other rights
and remedies available at law or in equity. Trustor shall, upon the demand of Beneficiary, assemble all of such Collateral and
make it available to Beneficiary at the Property, which is hereby agreed to be reasonably convenient to Beneficiary and Trustee.
The proceeds of any sale of any portion of the Collateral shall be applied first to the expenses of Beneficiary in retaking, holding,
preparing for sale, selling or similar matters, including reasonable attorney’s fees.

 

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4.02       TRUSTOR’S
COLLECTIONS. Until Beneficiary exercises its right to collect proceeds of the Collateral pursuant hereto, Trustor will collect
with diligence any and all proceeds of the Collateral. Any proceeds received by Trustor shall be in trust for Beneficiary, and,
upon written request by Beneficiary, Trustor shall keep all such collections separate and apart from all other funds and property
so as to be capable of identification as the property of Beneficiary and shall deliver such collections at such time as Beneficiary
may request to Beneficiary in the identical form received, properly endorsed or assigned when required to enable Beneficiary to
complete collection thereof.

 

4.03       TRUSTOR’S
OBLIGATIONS REGARDING COLLATERAL. Trustor shall: (a) upon reasonable prior notice by Beneficiary, permit representatives
of Beneficiary to inspect the Collateral and Trustor’s books and records relating to the Collateral and make copies thereof
and extracts therefrom and to arrange for verification of the amount of Collateral, under procedures acceptable to Beneficiary,
directly with Trustor’s debtors or otherwise at Trustor’s expense; (b) promptly notify Beneficiary of any attachment
or other legal process levied against any of the Collateral and any information received by Trustor relative to the Collateral,
Trustor’s debtors or other persons obligated in connection therewith, which may in any way adversely affect the value of
the Collateral or the rights and remedies of Beneficiary in respect thereto; (c) reimburse Beneficiary upon demand for any
and all costs, including without limitation reasonable attorneys’ and accountants’ fees, and other expenses incurred
in collecting any sums payable by Trustor under any obligation secured hereby, or in the checking, handling and collection of the
Collateral and the preparation and enforcement of any agreement relating thereto; (d) notify Beneficiary of each location
at which the Collateral is or will be kept, other than for temporary processing, storage or similar purposes, and of any removal
thereof to a new location, including without limitation each office of Trustor at which records relating to the Collateral are
kept; (e) provide, maintain and deliver to Beneficiary policies of insurance insuring the Collateral against loss or damage
by such risks and in such amounts, forms and by such companies as Beneficiary may reasonably require and with loss payable to Beneficiary,
and in the event Beneficiary takes possession of the Collateral, the insurance policy or policies and any unearned or returned
premium thereon shall at the option of Beneficiary become the sole property of Beneficiary; and (f) do all acts necessary
to maintain, preserve and protect all Collateral, keep all Collateral in good condition and repair and prevent any waste or unusual
or unreasonable depreciation thereof.

 

4.04       BENEFICIARY’S
COLLECTION OF PROCEEDS. Following an event of default that Trustor fails to cure within the time periods described in section
3.01, Beneficiary may provide notice to Trustor and thereafter collect proceeds of the Collateral and may give notice of assignment
to any and all of Trustor’s debtors, and Trustor does hereby irrevocably constitute and appoint Beneficiary its true and
lawful attorney-in-fact to enforce in Trustor’s name or in Beneficiary’s name or otherwise all rights of Trustor in
the Collateral and to do any and all things necessary and proper to carry out the purposes hereof; provided, however, Trustor shall
have the right to collect, retain, use and enjoy such proceeds subject to the terms hereof and the documents securing Trustor’s
obligations thereunder prior to the occurrence of any Event of Default hereunder or under any of said documents. It is hereby recognized
that the power of attorney herein granted is coupled with an interest and shall not be revocable and Beneficiary shall have the
right to exercise this power of attorney upon any Event of Default hereunder (Beneficiary shall promptly notify Trustor of any
action taken by Beneficiary pursuant to this provision but Beneficiary’s failure to do so shall not invalidate any such act,
affect any of Trustor’s obligations to Beneficiary or give rise to any right, claim or defense on the part of Trustor.)

 

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4.05       NO
REMOVAL. No personal property covered by the security interest granted herein may be removed from the Property without the
prior written consent of Beneficiary unless Trustor shall concurrently replace such personal property with similar property of
equivalent value on which Beneficiary has a valid first lien.

 

4.06       FINANCING
STATEMENTS. If required by Beneficiary at any time during the term of this Deed of Trust, Trustor will execute and deliver
to Beneficiary, in form satisfactory to Beneficiary, an additional security agreement and/or financing statement covering all personal
property of Trustor which may at any time be furnished, placed on, or annexed or made appurtenant to the Property and used, useful
or held for use in the operation of the improvements thereon. Trustor authorizes Beneficiary to file any financing statements,
continuation statements or amendments thereto describing the Collateral. Any breach of or default under such security agreement
shall constitute an Event of Default.

 

		V.	ENVIRONMENTAL COMPLIANCE

 

5.01       CERTAIN
DEFINITIONS. For purposes of this Article V, the following terms shall have the following definitions:

 

(a)          Governmental
Authority. “Governmental Authority” means, collectively (i) the United States; (ii) the state, county,
city, and any other political subdivision having jurisdiction over Trustor or any portion of the Property; (iii) all other
governmental or quasi-governmental authorities, boards, bureaus, agencies, commissions, departments, administrative tribunals,
and other instrumentalities or authorities having jurisdiction over Trustor or any portion of the Property; and (iv) all judicial
authorities having jurisdiction over Trustor or any portion of the Property.

 

(b)          Hazardous
Substance. “Hazardous Substance” means any:

 

(A)         Substance,
product, waste or other material of any nature whatsoever which is or becomes listed or regulated pursuant to any or all of the
following statutes and regulations, as the same may be amended from time to time:

 

(A)       The
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Sections 9601 et seq. (“CERCLA”);

 

    	 	23	 

     

    

 

(B)       The
Hazardous Materials Transportation Act, 49 U.S.C. Sections 1801, et seq.;

 

(C)       The
Resource Conservation and Recovery Act, 42 U.S.C. Sections 6901, et seq., (“RCRA”);

 

(D)       The
Toxic Substances Control Act, 15 U.S.C. Sections 2601, et seq.;

 

(E)       The
Clean Water Act, 33 U.S.C. Sections 1251, et seq.;

 

(F)       The
California Hazardous Waste Control Act, California Health and Safety Code Sections 25100, et seq.;

 

(G)       The
California Hazardous Substance Account Act, California Health and Safety Code Sections 25300, et seq.;

 

(H)       The
California Safe Drinking Water and Toxic Enforcement Act, California Health and Safety Code Sections 25429.5, et seq.;

 

(I)       California
Health and Safety Code Sections 25280, et seq. (pertaining to underground storage of Hazardous Substances);

 

(J)       The
California Hazardous Waste Management Act, California Health and Safety Code Sections 25179.1, et seq.;

 

(K)       California
Health and Safety Code Sections 25500, et seq. (pertaining to hazardous materials response plans and inventory);

 

(L)       The
California Porter-Cologne Water Quality Control Act, California Water Code Sections 13000, et seq.;

 

(M)       California
Civil Code Section 2929.5 (pertaining to inspections relating to hazardous substances); or

 

(N)       All
other existing and future federal, state and local laws, ordinances, rules, regulations, orders, requirements, and decrees (in
each case having the force of law) regulating, relating to, or imposing liability or standards of conduct concerning any hazardous,
toxic or dangerous waste, substance or material;

 

(B)         Any
substance, product, waste or other material of any nature whatsoever which may give rise to liability (x) under any of the
statutes or regulations described in clauses (A) through (N) of Paragraph 5.01(b)(1) above; or (y) under any reported
decisions of any state or federal court having jurisdiction over Trustor or any portion of the Property;

 

    	 	24	 

     

    

 

(C)       Petroleum,
petroleum products and by-products, gasoline or crude oil, other than petroleum and petroleum products contained within regularly
operated motor vehicles; and

 

(D)       Asbestos
or asbestos containing materials.

 

(c)          Hazardous
Substance Laws. “Hazardous Substance Laws” means all existing and future laws, ordinances, rules, regulations,
orders and requirements of all Governmental Authorities (including the statutes and regulations identified in Paragraph 5.01(b)
(1) above and all licenses, permits, plans and approvals granted or issued under or pursuant to such statutes and regulations)
in each case having the force of law relating to any or all of the following with respect to the Property:

 

(A)       Any
Hazardous Substance, including the use, storage, generation, production, treatment, disposal, handling, release, discharge, transportation,
repair, cleanup, remediation, removal or decontamination of any Hazardous Substance; and

 

(B)       The
environmental conditions in, on or under any portion of the Property, including soil, air, and groundwater conditions to the extent
caused by any Hazardous Substance.

 

(d)         Indemnified
Parties. “Indemnified Parties” means Beneficiary, its loan participants and any other Person who acquires an interest
in the loan and the Loan Documents pursuant to an assignment by the lender thereunder, and each of them, and each of their respective
officers, directors, employees, shareholders, parent companies, subsidiaries, affiliates and successors and assigns by merger,
reorganization or sale of substantially all of its assets.

 

(e)         Hazardous
Substance Claims and Losses. “Hazardous Substance Claims and Losses” means all claims, demands, damages according
to proof, liabilities, actions, causes of action, legal proceedings, administrative proceedings, suits, injuries, costs, losses,
debts, liens, interest, fines, charges, penalties and reasonable out-of-pocket expenses (including reasonable attorneys’,
accountants’, consultants’, and expert witness fees and costs) of every kind and nature (all of the foregoing are referred
to collectively as the “Claims and Losses”) which directly or indirectly arise out of or relate to any or all of the
following, but only to the extent (i) such Claims and Losses are not caused solely by the acts, negligence or tortious conduct
of any or all of the Indemnified Parties; and (ii) such Claims and Losses are incurred or suffered by any of the Indemnified
Parties prior to the Lien Termination Date or are asserted against any or all of the Indemnified Parties prior to the Lien Termination
Date:

 

(A)       Any
breach by Trustor of any representation, warranty or obligation contained in this Deed of Trust arising from or relating to Hazardous
Substances after the expiration of any applicable grace, notice or cure periods;

 

    	 	25	 

     

    

 

(B)       The
existence, presence, use, storage, generation, production, treatment, disposal, or handling of any Hazardous Substance in, on or
under any portion of the Property, whether caused by Trustor or any other Person (but excluding any Indemnified Party), including
any prior owner, Lessee, or occupant of any portion of the Property;

 

(C)       The
release (including any “release” as defined in California Civil Code Section 2929.5), discharge, or transport
of any Hazardous Substance onto or from any portion of the Property, including contamination of any Surrounding Property or any
natural resources (including groundwater), whether caused by Trustor or any other Person (but excluding any Indemnified Party),
including any prior owner, Lessee, or occupant of any portion of the Property;

 

(D)       The
violation of any Hazardous Substance Laws, whether by Trustor or any other Person (but excluding any Indemnified Party), including
any prior owner, Lessee, or occupant of any portion of the Property or any Surrounding Property; or

 

(E)       To
the extent required by any Hazardous Substance Laws, any repair, cleanup, remediation, removal, closure, or decontamination activity
relating to any Hazardous Substance in, on or under any portion of the Property or any Surrounding Property (but only to the extent
released from the Property with respect to the Surrounding Property), including any preparation for and investigation, testing,
and monitoring relating to any such activity; or

 

(F)       Any
personal injury, death, or property damage resulting from or relating to any or all of the matters described in clauses (A) through
(F) above.

 

(f)           Lien
Termination Date. “Lien Termination Date” means with respect to any part of the Property, the earlier to occur
of the following dates: (i) the date on which Beneficiary or any other Person acquires title to such part of the Property
as a result of a foreclosure or deed in lieu of foreclosure under the Deed of Trust or otherwise; (ii) the date on which Beneficiary
reconveys such part of the Property under the Deed of Trust; or (iii) the date on which all obligations secured hereby have
been fully satisfied.

 

(g)          Person.
“Person” means any natural person or entity, including any corporation, partnership, joint venture, trust, unincorporated
organization, trustee or Governmental Authority.

 

(h)          Surrounding
Property. “Surrounding Property” means all real property which is located adjacent to any part of the Property.

 

    	 	26	 

     

    

 

5.02       COMPLIANCE
WITH HAZARDOUS SUBSTANCE LAWS. Trustor shall comply with all Hazardous Substance Laws. Without limiting the generality of the
preceding sentence, Trustor shall not cause or permit (a) the existence, presence, use, storage, generation, production, treatment,
disposal, or handling of any Hazardous Substance in, on, or under the Property, whether such activities are conducted by Trustor
or any other Person, including any Lessee or occupant of the Property, including the installation of any underground storage tanks
or facilities for the deposit or storage of any Hazardous Substances, in violation of any Hazardous Substance Laws; or (b) the
release or discharge of any Hazardous Substance or the transportation or any Hazardous Substance onto or from the Property, including
the contamination of any Surrounding Property or any natural resources, including groundwater, in violation of any Hazardous Substance
Laws.

 

5.03       ENVIRONMENTAL
ASSESSMENT. Within thirty (30) days after the occurrence of any of the following events, Trustor shall cause to be prepared
and delivered to Beneficiary, at Trustor’s expense, an environmental site assessment and report for the Property, or an update
of any such environmental site assessment and report which has previously been prepared by or for Trustor, prepared by a qualified,
state-registered, professional environmental auditor acceptable to Beneficiary (the “Assessment Report”): Beneficiary
has learned of or reasonably suspects (a) the existence, presence, use, storage, handling, generation, production, treatment,
disposal or handling of any Hazardous Substance in, on, under or about the Property except as otherwise permitted hereunder; (b) the
release, discharge or transport of any Hazardous Substance onto or from the Property except as otherwise permitted hereunder; or
(c) the threatened release, discharge, or transport of any Hazardous Substance onto or from the Property.

 

5.04       CONTENTS
OF ASSESSMENT REPORT. If specifically and reasonably requested by Beneficiary, each Assessment Report shall include the following
information: (a) a description of the presence, character, location or amount of Hazardous Substances in, on, or under the
Property; (b) a review and audit of all books, records, permits, notices, citations, orders and other data and information
in the possession or control of Trustor (to the extent not privileged or confidential) relating to Hazardous Substances in, on
or under the Property or any Surrounding Property, including historical data and information (if such data and information is not
covered in any prior Assessment Report received by Beneficiary); (c) a review and report on any records or listings of any
Governmental Authority concerning Hazardous Substances in, on or under the Property or any Surrounding Property; (d) an investigation
and report on the history of ownership and use of the Property or any Surrounding Property, unless covered in any prior Assessment
Report received by Beneficiary; (e) a report of interviews with the current Lessees and occupants, if any, of the Property
concerning their use of the Property; (f) an evaluation of the likelihood of any soil or groundwater contamination resulting
from any Hazardous Substances in, on or under the Property or any Surrounding Property; and (g) such other information or
recommendations as Beneficiary may reasonably require.

 

5.05       REMEDIAL
ACTIONS BY TRUSTOR. If the existence, presence, use, storage, generation, production, treatment, disposal, or handling of any
Hazardous Substance in, on or under the Property, or the release, discharge, or transport of any Hazardous Substance onto or from
the Property (a) gives rise to any Hazardous Substance Claims and Losses; (b) causes or reasonably threatens to cause
a significant public health effect; or (c) pollutes or reasonably threatens to pollute the environment in violation of any
Hazardous Substance Laws, then in any of such circumstances, Trustor shall, subject to Paragraph 5.09 below, promptly commence
and diligently prosecute all actions and proceedings which are necessary or appropriate (i) to repair, cleanup, remediate,
and decontaminate the Property and any Surrounding Property with respect to such Hazardous Substances (but only to the extent legally
obligated and permitted to do so); and (ii) to mitigate any exposure to liability by Trustor or Beneficiary with respect to
such Hazardous Substances.

 

    	 	27	 

     

    

 

5.06       INDEMNITY.
Trustor shall indemnify and hold Beneficiary and the other Indemnified Parties harmless from and against any and all Hazardous
Substance Claims and Losses. Any amounts paid or required to be paid by any Indemnified Party in connection with any Hazardous
Substance Claims and Losses (a) shall be due and payable by Trustor to such Indemnified Party within five (5) days of
such Indemnified Party’s demand (which demand shall be accompanied by evidence in reasonable detail of such amounts by the
Indemnified Party); and (b) shall bear interest from the date such amounts are due and payable by Trustor at the Default Rate.
Notwithstanding anything to the contrary contained in this Deed of Trust, Trustor’s obligations under this Paragraph 5.06
shall survive and remain effective (i) following the repayment of the obligations secured by this Deed of Trust and the reconveyance
of the Property under this Deed of Trust; and (ii) following any foreclosure, deed in lieu of foreclosure, or similar proceeding
through which Beneficiary or any other Person obtains title to the Property. Without limiting any of the terms of the Loan Documents,
each of the Indemnified Parties, in its reasonable discretion (x) shall have the right to select, retain and direct attorneys,
accountants, consultants, and experts acceptable to such Indemnified Party to represent or advise it in connection with any of
the Hazardous Substance Claims and Losses (provided, however, that each of the Indemnified Parties shall cooperate with Trustor
to avoid any unreasonable duplication of efforts and unnecessary costs and expenses, and until an Event of Default occurs, Trustor,
subject to the reasonable approval of the Indemnified Parties, may hire and engage such parties and shall take the lead in all
matters), and all reasonable out-of-pocket costs, fees expenses and advances made or incurred by such Indemnified Party in connection
therewith shall be deemed to be included in the Hazardous Substance Claims and Losses; and (y) following the occurrence of an Event
of Default, shall have the right to settle, compromise, adjust, and pay any or all of the Hazardous Substance Claims and Losses
asserted against or incurred or suffered by it for such amounts and on such terms as the Indemnified Party may reasonably determine.
Nothing contained in this Deed of Trust shall be deemed to obligate any Indemnified Party to pay any Hazardous Substance Claims
and Losses.

 

5.07       NO
IMPAIRMENT OF TRUSTOR’S INDEMNIFICATION OBLIGATIONS. Trustor’s indemnification obligations under Paragraph 5.06
above shall not be impaired, diminished, or otherwise affected in any way as a result of any information, data, documents, or notice
given to or received or obtained by any Indemnified Party regarding or relating to the release, threatened release, presence, existence,
character, or magnitude of any Hazardous Substances in, on or under the Property or any Surrounding Property. Each Indemnified
Party shall provide Trustor on a prompt basis all notices and information received by such party (to the extent not privileged
or confidential) with respect to Hazardous Substance Claims and Losses.

 

5.08       NOTICES.
Promptly upon receipt by Trustor, Trustor shall deliver complete and accurate copies of all notices, correspondence, and information
which Trustor receives from or forwards to any Governmental Authority (but only to the extent not privileged or confidential) regarding
(a) any Hazardous Substance in, on or under the Property or the Surrounding Property; or (b) any actions instituted or
threatened by any such Governmental Authority concerning any Hazardous Substance which affects or may affect the Property or any
Surrounding Property. Trustor shall promptly notify Beneficiary in writing of (i) any written information that Trustor obtains
regarding any Hazardous Substance in, on or under the Property or the Surrounding Property (to the extent not privileged or confidential);
(ii) any written information that Trustor obtains regarding the release, discharge, or transport of any Hazardous Substance
onto or from the Property or any Surrounding Property (to the extent not privileged or confidential); or (iii) any Hazardous
Substance Claims and Losses of which Trustor receives written notice. Upon one (1) day’s prior notice to Trustor, Beneficiary,
or its designee, shall have the right from time to time during normal business hours to examine and make copies thereof of all
books and records (to the extent not privileged or confidential) of Trustor relating to Hazardous Substances in, on or about the
Property or any Surrounding Property.

 

    	 	28	 

     

    

 

5.09       NOTICE
TO BENEFICIARY OF REMEDIAL ACTIONS. As soon as reasonably possible prior to (a) taking any action in response to the existence,
presence, use, storage, generation, production, treatment, disposal, or handling of any Hazardous Substance in, on, under or about
the Property or any Surrounding Property, or to the release, discharge, or transport of any Hazardous Substance onto or from the
Property; or (b) entering into any settlement agreement, consent decree, or other compromise or agreement regarding any Hazardous
Substance Claims and Losses (such agreements and decrees are referred to collectively as “Hazardous Substance Agreements”),
Trustor shall provide Beneficiary with a written notice (the “Remediation Notice”) describing in reasonable detail
the action proposed to be taken by Trustor or the nature of the Hazardous Substance Agreement to be entered into by Trustor as
described in clauses (a) and (b) of this Paragraph. Beneficiary, at its option, shall have the right to notify Trustor
of any reasonable objections which Beneficiary has with respect to any matter described in the Remediation Notice. In the event
of any such objection by Beneficiary, Trustor (i) shall not take the actions described in the Remediation Notice as to which
Beneficiary has objected; and (ii) shall take such actions as may be reasonably required by Beneficiary to address and resolve
Beneficiary’s objections. If Beneficiary fails to give Trustor written notice of any such objections and its reasons therefor
by Beneficiary within ten (10) days after Beneficiary’s receipt of the Remediation Notice, Trustor may proceed to take the
actions described in the Remediation Notice; provided, however, that neither Beneficiary’s failure to object, in whole or
in part, to any proposed action described in any Remediation Notice, nor any communication between Beneficiary and Trustor relating
to any such proposed action, shall constitute or be construed as Beneficiary’s approval of any such actions, unless Beneficiary
consents thereto in writing. Trustor shall have the sole responsibility for all aspects of Trustor’s business and the development,
use, ownership, operation, maintenance, and repair of the Property, including (A) the suitability and adequacy of any proposed
actions described in any Remediation Notice; and (B) the suitability and adequacy of any other action taken by Trustor with
respect to the existence, presence, use, storage, generation, production, treatment, disposal, or handling of any Hazardous Substance
in, on, under or about the Property or any Surrounding Property or the release, discharge, or transport of any Hazardous Substance
onto or from the Property. Without limiting any of the terms of the Loan Documents, Trustor agrees that Beneficiary shall not be
liable or responsible in any way or under any circumstances to Trustor or any other Person within Trustor’s control for any
or all of the matters described in clauses (a) and (b) of this Paragraph. Trustor shall not be required to provide Beneficiary
with a Remediation Notice pursuant to this Paragraph if Trustor reasonably determines that (x) immediate action is reasonably
required in connection with any matter described in clauses (a) or (b) of this Paragraph and it is not practical
to give Beneficiary the Remediation Notice prior to taking such action; or (y) the matter described in clauses (a) or
(b) of this Paragraph for which a Remediation Notice would otherwise be required does not adversely affect the Property
or Trustor’s ability to perform its obligations under the Loan Documents. Under such circumstances, Trustor shall provide
Beneficiary with written notice of any such action taken by Trustor as soon as reasonably practicable. If Trustor breaches any
of its obligations under this Article V, Beneficiary, at its option and its sole and absolute discretion, but without any
obligation whatsoever to do so and following the expiration of any applicable grace, notice or cure periods, may enter upon the
Property and take any or all actions which Trustor was obligated to take and which Beneficiary determines to be necessary or appropriate
(1) to repair, cleanup, remediate, or decontaminate the Property and any Surrounding Property with respect to any Hazardous
Substances; and (2) to mitigate any exposure to Hazardous Substance Claims and Losses by Beneficiary with respect to any Hazardous
Substances.

 

    	 	29	 

     

    

 

5.10       
DEFENSE OF ACTIONS AND PROTECTION OF SECURITY BY BENEFICIARY. If an Event of Default has occurred, Beneficiary shall have
the right, but not the obligation, to appear in and defend any action or proceeding, whether commenced by or against Trustor or
any other Person, relating to any Hazardous Substance Claims and Losses. Beneficiary shall have the right to incur and pay all
reasonable costs, fees, expenses and liabilities that Beneficiary determines to be reasonably necessary or appropriate in connection
with any such action or proceeding, and all such costs, fees, expenses and liabilities incurred or paid by Beneficiary (a) shall
be due and payable by Trustor to Beneficiary on Beneficiary’s demand (which demand shall be accompanied by evidence in reasonable
detail of the expenditures made by Beneficiary); (b) shall constitute additional indebtedness of Trustor to Beneficiary; and
(c) shall bear interest from the date such amounts are due and payable at the Default Rate. Nothing contained in this Deed
of Trust shall be deemed to obligate Beneficiary to make any appearance in or defend any action or proceeding.

 

5.11       INSPECTION;
APPOINTMENT OF RECEIVER. Beneficiary, acting directly through its authorized agents or through a court-appointed receiver,
shall have the right to enter upon and inspect the Property for the purpose of determining the existence, character, and magnitude
of any Hazardous Substances in, on or under the Property. Such entry by Beneficiary shall be made during normal business hours
and upon not less than twenty-four (24) hours prior written notice by Beneficiary to Trustor, except when Beneficiary in good faith
determines that an emergency exists, in which case Beneficiary shall have the right to enter upon the Property without notice and
at such different times as Beneficiary in good faith determines may be necessary or appropriate for the protection of Beneficiary’s
interests. In connection with the foregoing, Beneficiary shall use reasonable efforts not to disturb any of the occupants or tenants
of the Property. Whether or not Beneficiary has elected to accelerate any or all of the obligations secured by this Deed of Trust,
and if an Event of Default exists, Beneficiary shall have the absolute and unconditional right to apply to any court of competent
jurisdiction and obtain the appointment of a receiver or receivers to enforce Beneficiary’s inspection rights relating to
Hazardous Substances as authorized by California law, including in accordance with the provisions of California Code of Civil Procedure
Section 564(c). If Beneficiary obtains the appointment of a receiver under any of the terms of this Deed of Trust or applicable
law, Beneficiary, in its sole and absolute discretion, shall have the right to seek and obtain a court order authorizing the receiver
(a) to operate and maintain the Property and take custody of all Rents and Profits and use and apply the Rents and Profits
in order to repair, cleanup, remediate, and decontaminate the Property with respect to any Hazardous Substances existing in violation
of any Hazardous Substance Laws, and bring the Property into compliance with Hazardous Substance Laws; (b) to take any other
action necessary or appropriate to ensure the Property’s compliance with Hazardous Substance Laws, including the retention
of consultants and contractors and negotiations with Governmental Authorities; and (c) to incur such other obligations and
take such other actions as are ordinarily incurred by owners of real property, without any personal liability on the part of the
receiver. Beneficiary shall have no obligation or duty of any kind to enter on or inspect the Property or to examine or review
any of Trustor’s books and records relating to any Hazardous Substances. All such inspections and reviews by Beneficiary,
including Beneficiary’s review of any Assessment Report or proposed plan of testing, monitoring, cleanup or remediation,
shall be for Beneficiary’s sole benefit and not for the benefit of Trustor or any other Person. No inspection of the Property
by Beneficiary shall constitute or be construed as a representation or determination by Beneficiary that the Property complies
with any Hazardous Substance Laws or that Hazardous Substances are or are not present in, on or under the Property or any Surrounding
Property. All information prepared by or for Beneficiary in connection with the exercise of its rights under this Deed of Trust
shall at all times be and remain Beneficiary’s property, and Beneficiary shall have no obligation to disclose or otherwise
make such information available to Trustor or any other Person, except as otherwise required by applicable law.

 

    	 	30	 

     

    

 

5.12       ENVIRONMENTAL
PROVISIONS. For purposes of this Deed of Trust, the term “Environmental Provisions” means, collectively, all of
the terms of this Article V. All Environmental Provisions contained in the Loan Documents shall be deemed to constitute “environmental
provisions” within the meaning of California Code of Civil Procedure Section 736(f)(2).

 

5.13       BENEFICIARY’S
RIGHT TO BRING SEPARATE ACTIONS TO ENFORCE ENVIRONMENTAL PROVISIONS. Upon the occurrence of an Event of Default, Trustor agrees
that Beneficiary and the other Indemnified Parties shall each have the right to commence and prosecute one or more separate actions
(a) for Trustor’s breach of any Environmental Provisions; (b) for the recovery of damages based upon any such breach;
(c) for enforcement of any of the Environmental Provisions, including Trustor’s obligation to indemnify the Indemnified
Parties with respect to Hazardous Substance Claims and Losses; and (d) for injunctive relief enforcing any or all of the Environmental
Provisions, including an action in accordance with the provisions of California Code of Civil Procedure Section 736. No such
separate action shall in any way be deemed to be an “action” within the meaning of California Code of Civil Procedure
Section 726(a) or constitute a money judgment for a deficiency or a deficiency judgment within the meaning of California
Code of Civil Procedure Sections 580a, 580b, 580d, or 726(b), respectively. Trustor agrees that Beneficiary shall have the
right to bring one or more actions under this Paragraph without acceleration of the obligations secured by this Deed of Trust
or commencement of foreclosure proceedings under this Deed of Trust.

 

    	 	31	 

     

    

 

5.14       WAIVER
OF LIEN AT BENEFICIARY’S SOLE OPTION. Upon the occurrence of an Event of Default, Beneficiary, at its option and in its
sole and absolute discretion, but without any obligation whatsoever to do so, shall have the right (a) to waive its lien against
all or part of the Property, to the extent such property is environmentally impaired, in accordance with California Code of Civil
Procedure Section 726.5; and (b) to exercise any and all rights and remedies of an unsecured creditor against Trustor
and all of Trustor’s assets and property, including seeking an attachment order under California Code of Civil Procedure
Section 483.010. As between Beneficiary and Trustor, for purposes of California Code of Civil Procedure Section 726.5,
Trustor shall have the burden of proving that Trustor or any party related to Trustor (or any affiliate or agent of Trustor or
any such related party) did not knowingly or negligently cause or contribute to, or knowingly or willfully permit or acquiesce
in, the release or threatened release of the Hazardous Substances which caused the environmental impairment of the Property. Nothing
contained in this Deed of Trust shall be deemed to obligate Beneficiary to exercise any election that Beneficiary may have under
California Code of Civil Procedure Section 726.5.

 

5.15       ARBITRATION
REGARDING ENVIRONMENTAL IMPAIRMENT. If a dispute between Beneficiary and Trustor arises with respect to the issue of whether
or not all or part of the Property is “environmentally impaired” within the meaning of California Code of Civil Procedure
Section 726.5(e)(3), then either Beneficiary or Trustor, at its option and in its sole and absolute discretion, may elect
by written notice to the other party to have such dispute resolved and settled by arbitration on the following terms and conditions:

 

(a)       American
Arbitration Association Rules. The arbitration shall be determined by three (3) arbitrators (the “Arbitrators”)
in accordance with the Commercial Arbitration Rules of the American Arbitration Association, and judgment upon the decision rendered
by the Arbitrators in such proceeding may be entered in any court of competent jurisdiction.

 

(b)       Procedure.
In the arbitration proceeding, the provisions of California Code of Civil Procedure Section 1283.05, or any successor or amended
statute or law containing similar provisions, shall be applicable. The hearing on the matter shall be heard in San Mateo, California.
The judgment upon the decision rendered in any such arbitration shall be final and binding on the parties. The Arbitrators shall
use their reasonable efforts to render a decision in such arbitration proceeding as expeditiously as possible and, in any event,
within ninety (90) days after written notice of intention to arbitrate has been given by Beneficiary to Trustor or Trustor
to Beneficiary, as the case may be. The Arbitrators shall have the power and authority to render a decision solely with respect
to the issue of whether or not the Property, or the portion thereof which is the subject of the arbitration proceeding, is “environmentally
impaired” within the meaning of California Code of Civil Procedure 726.5(e)(3). The Arbitrators shall render their decision
in writing and shall cause a copy of such decision to be provided to the parties.

 

(c)       Costs.
All costs and expenses of any arbitration proceeding, excluding attorneys’ fees, shall be shared equally by Beneficiary and
Trustor. Each party shall bear its own attorneys’ fees; provided, however (i) that if the Arbitrators determine that
the Property is environmentally impaired under California Code of Civil Procedure Section 726.5(e)(3), Trustor shall pay all
costs and expenses of Beneficiary in the arbitration proceeding, including reasonable attorneys’ fees and costs incurred
by Beneficiary; and (ii) that if the Arbitrators determine that the Property is not environmentally impaired under California
Code of Civil Procedure Section 726.5(e)(3), Beneficiary shall pay all costs and expenses of Trustor in the arbitration proceeding,
including reasonable attorneys’ fees and costs incurred by Trustor.

 

    	 	32	 

     

    

 

5.16       WARRANTIES
AND REPRESENTATIONS BY TRUSTOR. Trustor represents and warrants to Beneficiary as of the date hereof that, to Borrower’s
knowledge, after due inquiry and investigation:

 

(a)      
   No Hazardous Substances.

 

(i)       The
Property does not contain any Hazardous Substances, and no underground storage tanks or underground deposits of Hazardous Substances
are or previously have been located on the Property; and

 

(ii)       Trustor
is in compliance with all Hazardous Substance Laws relating to the Property and the use of the Property, including those relating
to disclosure to Lessees of the Property.

 

(b)          No
Hazardous Substance Release. No Hazardous Substance is being or has been released or discharged onto or from the Property in
violation of applicable Hazardous Substance Laws;

 

(c)          Hazardous
Substance Litigation. There is no pending or threatened action or proceedings before any Governmental Authority in which any
Person alleges the existence, presence, release, threat of release, placement on, under or about the Property, or the use, manufacture,
handling, generation, storage, treatment, discharge, burial or disposal in, on, under or about the Property, or the transportation
to or from the Property of any Hazardous Substance;

 

(d)          Notices
from Governmental Authorities. Trustor has not received any notice and has no knowledge that any Governmental Authority has
determined or threatens to determine that (i) any Hazardous Substance exists or is present in, on or under the Property in
violation of any Hazardous Substance Laws; (ii) any Hazardous Substance is being stored, generated, produced, treated, disposed
of, or handled in, on or under the Property in violation of any Hazardous Substance Laws; or (iii) any Hazardous Substance
has been or is being released, discharged, or transported onto or from the Property in violation of any Hazardous Substance Laws;

 

(e)          Agreements
Regarding Hazardous Substances. There have been no written communications or agreements between Trustor and any Governmental
Authority or any other Person, including any prior owners of the Property, relating in any way to the presence, release, threat
of release, placement on, under or about the Property, or the use, manufacture, handling, generation, storage, treatment, discharge,
burial or disposal in, on, under or about the Property, or the transportation to or from the Property, of any Hazardous Substance;
and

 

    	 	33	 

     

    

 

(f)          Border
Zone Property. Neither Trustor nor any other Person, including any prior owner, Lessee, or occupant of the Property, has discovered
any occurrence or condition on any Surrounding Property that could reasonably cause the Property to be classified as “border
zone property” under the provisions of California Health and Safety Code Sections 25220, et seq., or any regulation
adopted in accordance therewith, or to be otherwise subject to any restrictions on the ownership, occupancy, transferability or
use of the Property under any Hazardous Substances Law.

 

		VI.	MISCELLANEOUS PROVISIONS

 

6.01       NOTICES.
All notices, requests, demands, approvals, or other communications given hereunder or in connection with this Deed of Trust shall
be in writing and shall be deemed given when delivered by hand or sent by registered or certified mail, return receipt requested,
addressed as follows:

 

		If to Beneficiary:	SERENE INVESTMENT MANAGEMENT, LLC

c/o 366 Development LLC

3065 Rosecrans Place, Suite 205

San Diego, California 92110

 

		If to Trustor:	CAPITOL STATION 65, LLC

c/o First Capital Real Estate Trust, Inc.

Attn: Suneet Singal

60 Broad Street, 34th Floor

New York, NY 10004

 

 

6.02       NO
WAIVER. No consent or waiver, express or implied, by the Beneficiary to or of any default by the Trustor shall be construed
as a consent or waiver to or of any other default at the same time or upon any future occasion. By accepting payment of any sum
secured hereby after its due date or in an amount less than the sum due, Beneficiary does not waive its rights either to require
prompt payment when due of all other sums so secured or to declare a default as herein provided for failure to pay the total sum
due.

 

6.03       AMENDMENT.
This Deed of Trust can be amended or otherwise altered, terminated or discharged only by a writing signed by the party to be charged
therewith.

 

6.04       PARTIAL
INVALIDITY. In case any one or more of the provisions of this Deed of Trust are held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Deed of Trust.

 

6.05       HEADINGS.
This Deed of Trust shall inure to the benefit of and be binding upon the Trustor and the Beneficiary and their respective representatives,
successors and assigns. The terms “Trustor” and “Beneficiary” shall include all subsequent holders of their
respective right, title and interest under this Deed of Trust, the Loan Agreement and each other Loan Document, and Beneficiary
may assign this Deed of Trust, the Loan Agreement and any other Loan Document to a third party without Trustor’s consent.
Headings are only for convenience of reference and do not alter the meaning of any section.

 

    	 	34	 

     

    

 

6.06       TRUSTEE’S
POWERS. At any time, or from time to time, without liability therefor and without notice, upon written request of Beneficiary
and presentation of this Deed of Trust for endorsement, and without affecting the personal liability of any person for payment
of all or any portion of the indebtedness secured hereby or the effect of this Deed of Trust upon the remainder of the Property,
Trustee may (a) reconvey any part of the Property; (b) consent in writing to the making of any map or plat thereof; (c) join
in granting any easement thereon, or (d) join in any extension agreement or any agreement subordinating the lien or charge
hereof.

 

6.07       BENEFICIARY’S
RIGHT TO ENTER, INSPECT AND CURE. Beneficiary is authorized by itself, its contractors, agents, employees or workmen, upon
24 hours advance notice to enter at any reasonable time upon any part of the Property for the purpose of inspecting the same, and
for the purpose of performing any of the acts it is authorized to perform under the terms of this Deed of Trust.

 

6.08       SUCCESSORS
IN INTEREST. This Deed of Trust applies to, inures to the benefit of, and binds all parties hereto, their heirs, legatees,
devisees, administrators, executors, successors and assigns. In this Deed of Trust, whenever the context so requires, the masculine
gender includes the feminine and/or neuter, and the singular number includes the plural.

 

6.09       AFFIDAVIT
TO TRUSTEE. Trustee, upon presentation to it of an affidavit signed by or on behalf of Beneficiary, setting forth any fact
or facts showing a default by Trustor under any of the terms or conditions of this Deed of Trust, is authorized to accept as true
and conclusive all facts and statements in such affidavit and to act hereunder in complete reliance thereon.

 

6.10       TRUSTEE’S
ACCEPTANCE. Trustee accepts this trust when this Deed of Trust, duly executed and acknowledged, is made a public record as
provided by law. The trust created hereby is irrevocable by Trustor.

 

6.11       NO
OBLIGATION TO NOTIFY. Trustee shall be under no obligation to notify any party hereto of any action or proceeding of any kind
in which Trustor, Beneficiary and/or Trustee shall be a party, unless brought by Trustee, or of any pending sale under any other
deed of trust.

 

6.12       SUBSTITUTION
OF TRUSTEE. Beneficiary may, from time to time, by a written instrument executed and acknowledged by Beneficiary and recorded
in the county or counties where the Property is located, substitute a successor or successors for the Trustee named herein or acting
hereunder.

 

6.13       NOTICE
TO TRUSTOR. Trustor requests that a copy of any notice of default and of any notice of sale hereunder be mailed to Trustor
at the address set forth above.

 

6.14       RECONVEYANCE.
Upon written request of Beneficiary stating that all sums and obligations secured hereby have been satisfied and upon surrender
to Trustee of this Deed of Trust for cancellation and retention and upon payment of its fees, Trustee shall reconvey, without warranty,
the Property then held hereunder. The recitals in such reconveyance of any matters or facts shall be conclusive proof of the truthfulness
thereof. The grantee in such reconveyance may be described as “the person or persons legally entitled thereto.” [In
addition, Beneficiary will permit partial reconveyances of portions of the Real Property as provided in the Loan Agreement.]

 

    	 	35	 

     

    

 

6.15       RELEASES,
EXTENSIONS, MODIFICATIONS AND ADDITIONAL SECURITY. Without affecting the liability or obligations of any person, including
Trustor, for the performance of any obligations secured hereby (excepting only any person or property otherwise expressly released
in writing by Beneficiary), Beneficiary may from time to time and without notice release any person liable for payment of any of
said indebtedness or the performance of any of said obligations, extend the time of payment or otherwise alter the terms of any
of said obligations, accept additional security therefor of any kind, including trust deeds or mortgages, or alter, substitute
or release any property (including the Property) securing said obligations.

 

6.16       GOVERNING
LAW. This Deed of Trust shall be construed and enforced in accordance with the laws of the State of California.

 

6.17       COUNTERPARTS.
This Deed of Trust may be executed in several counterparts, each of which shall be deemed to be an original copy and all of which
together shall constitute one agreement binding on all parties hereto, notwithstanding that all the parties shall not have signed
the same counterpart.

 

IN WITNESS WHEREOF, Trustor has executed this
Deed of Trust as of the date set forth above.

 

	WITNESS:	 	trustor:
	 	 	CAPITOL STATION 65, LLC, a California 
	 	 	limited liability company
	 	 	 
	Cindy Campbell	 	By: Capitol Station Member, LLC, a Delaware 
	 	 	limited liability company, its Manager
	 	 	By: Capitol Station Holdings, LLC, a California
	 	 	limited liability company, its Manager
	 	 	By: Township Nine Owner, LLC, a Delaware
	 	 	limited liability company, its Member
	 	 	By: First Capital Real Estate Operating Partnership, L.P., a Delaware limited partnership, its Manager
	 	 	By: First Capital Real Estate Trust, Incorporated, a Maryland corporation, its General Partner
	 	 	 	 
	 	 	By:	/s/ Suneet Singal
	 	 	Name: Suneet Singal
	 	 	Title: Chief Executive Officer, Treasurer,
	 	 	Secretary, and Chairman of the Board of the
	 	 	Board of First Capital Real Estate Trust, Inc.

 

    	 	36	 

     

    

 

STATE OF CALIFORNIA

COUNTY OF __________________

 

On _________________ before me, ______________________________________

 

personally appeared ___________________________________________________,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

 

I certify under PENALTY OF PERJURY under the laws of the State of
California that the foregoing paragraph is true and correct.

 

WITNESS my hand and official seal.

 

[SEE ATTACHED CALIFORNIA ACKNOWLEDGMENT]

 

    	 	37	 

     

    

 

  

    	 	38	 

     

    

 

EXHIBIT A

LEGAL DESCRIPTION OF PROPERTY

 

THE LAND DESCRIBED HEREIN IS SITUATED IN THE STATE OF CALIFORNIA,
COUNTY OF SACRAMENTO, CITY OF SACRAMENTO, AND IS DESCRIBED AS FOLLOWS:

 

Lots 1, 2, 3, 5, 6 and 7, Lots A, B, and Designated Remainder 1
and Designated Remainder 2, as shown on the "Final Map of Township 9-Phase 1, Subdivision No. P10-036", filed November
13, 2012, in Book 378 of Maps, Map No. 1, records of Sacramento County.

APNs: 001-0020-056, 057, 058, 060, 061, 062, 063, 064, 066 and 067.

 

    	 	39Form of Medium-Term Notes, Series K

 Exhibit 4.1 

[Face of Note] 

Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation
(“DTC”), to the Company or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as requested by an authorized representative
of DTC (and any payment is made to Cede & Co. or such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein. 
  

					
	 CUSIP NO. 95000E2M0
	  	 	FACE AMOUNT: $                  	 
	 REGISTERED NO.      
	  			

 WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES K 

Due Nine Months or More From Date of Issue 

Principal at Risk Securities Linked to the EURO STOXX 50® Index 

due September 8, 2020 

WELLS FARGO & COMPANY, a corporation duly organized and existing under the laws of the State of Delaware (hereinafter
called the “Company,” which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & Co., or registered assigns, an amount equal to the
Redemption Amount (as defined below), in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, on the Stated Maturity Date. The “Initial Stated Maturity
Date” shall be September 8, 2020. If the Calculation Day (as defined below) is not postponed, the Initial Stated Maturity Date will be the “Stated Maturity Date.” If the Calculation Day is postponed, the
“Stated Maturity Date” shall be the later of (i) the Initial Stated Maturity Date and (ii) the third Business Day (as defined below) after the Calculation Day as postponed. This Security shall not bear any interest. 

Any payments on this Security at Maturity will be made against presentation of this Security at the office or agency of the
Company maintained for that purpose in the City of Minneapolis, Minnesota and at any other office or agency maintained by the Company for such purpose. 

“Face Amount” shall mean, when used with respect to this Security, the amount set forth on the face of this
Security as its “Face Amount.” 

 Determination of Redemption Amount 

The “Redemption Amount” of this Security will equal: 

 

	 	•	 	 if the Ending Level is greater than or equal to the Starting Level: the Face Amount plus:

  

																			
		 	 	 	  Face Amount x    	 	 	 	 Ending Level – Starting Level

Starting Level
	 	 	 	    x Participation Rate	 	 	 	  ;  
	 	

  

	 	•	 	 if the Ending Level is less than the Starting Level, but greater than or equal to the Threshold Level: the
Face Amount; or 

  

	 	•	 	 if the Ending Level is less than the Threshold Level: the Face Amount minus: 

 

											
		 	 	 	  Face Amount x    	 	 Starting Level – Ending Level

Starting Level
	 	 	 	

 All calculations with respect to the Redemption Amount will be rounded to the nearest one hundred-thousandth,
with five one-millionths rounded upward (e.g., 0.000005 would be rounded to 0.00001); and the Redemption Amount will be rounded to the nearest cent, with one-half cent rounded upward. 

“Index” shall mean the EURO STOXX 50® Index. 

The “Pricing Date” shall mean August 30, 2017. 

The “Starting Level” is 3403.71, the Closing Level of the Index on the Pricing Date. 

The “Closing Level” of the Index on any Trading Day means the official closing level of the Index reported by
the Index Sponsor on such Trading Day, as obtained by the Calculation Agent on such Trading Day from the licensed third-party market data vendor contracted by the Calculation Agent at such time; in particular, taking into account the decimal
precision and/or rounding convention employed by such licensed third-party market data vendor on such date, subject to the provisions set forth below under “Discontinuance of The Index; Alteration of Method of Calculation” and “Market
Disruption Events.” 
 The “Ending Level” will be the Closing Level of the Index on the Calculation
Day. 
 The “Threshold Level” is 2722.968, which is equal to 80% of the Starting Level. 

The “Participation Rate” is 188%. 

“Index Sponsor” shall mean STOXX Limited. 

  
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 “Business Day” shall mean a day, other than a Saturday or
Sunday, that is neither a legal holiday nor a day on which banking institutions are authorized or required by law or regulation to close in New York, New York. 

A “Trading Day” means a day, as determined by the Calculation Agent, on which (i) the Index Sponsor is
scheduled to publish the level of the Index and (ii) each Related Futures or Options Exchange is scheduled to be open for trading for its regular trading session. 

The “Related Futures or Options Exchange” for the Index means an exchange or quotation system where trading
has a material effect (as determined by the Calculation Agent) on the overall market for futures or options contracts relating to the Index. 

The “Relevant Stock Exchange” for any security underlying the Index means the primary exchange or quotation
system on which such security is traded, as determined by the Calculation Agent. 
 The “Calculation Day”
shall be August 31, 2020. If such day is not a Trading Day, the Calculation Day will be postponed to the next succeeding Trading Day. The Calculation Day is also subject to postponement due to the occurrence of a Market Disruption Event (as
defined below). If a Market Disruption Event occurs or is continuing on the Calculation Day, such Calculation Day will be postponed to the first succeeding Trading Day on which a Market Disruption Event has not occurred and is not continuing;
however, if such first succeeding Trading Day has not occurred as of the eighth Trading Day after the originally scheduled Calculation Day, that eighth Trading Day shall be deemed to be the Calculation Day. If the Calculation Day has been postponed
eight Trading Days after the originally scheduled Calculation Day and a Market Disruption Event occurs or is continuing on such eighth Trading Day, the Calculation Agent will determine the Closing Level of the Index on such eighth Trading Day in
accordance with the formula for and method of calculating the Closing Level of the Index last in effect prior to commencement of the Market Disruption Event, using the closing price (or, with respect to any relevant security, if a Market Disruption
Event has occurred with respect to such security, its good faith estimate of the value of such security at the time at which the official Closing Level of the Index is calculated and published by the Index Sponsor) on such date of each security
included in the Index. As used herein, “closing price” means, with respect to any security on any date, the Relevant Stock Exchange traded or quoted price of such security as of the time at which the official Closing Level of the
Index is calculated and published by the Index Sponsor. 
 “Calculation Agent Agreement” shall mean the
Calculation Agent Agreement dated as of March 18, 2015 between the Company and the Calculation Agent, as amended from time to time. 

“Calculation Agent” shall mean the Person that has entered into the Calculation Agent Agreement with the
Company providing for, among other things, the determination of the Ending Level and the Redemption Amount, which term shall, unless the context otherwise requires, include its successors under such Calculation Agent Agreement. The initial
Calculation Agent shall be Wells Fargo Securities, LLC. Pursuant to the Calculation Agent Agreement, the Company may appoint a different Calculation Agent from time to time after the initial issuance

  
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of this Security without the consent of the Holder of this Security and without notifying the Holder of this Security. 

Discontinuance Of The Index; Alteration Of Method Of Calculation 

If the Index Sponsor discontinues publication of the Index, and the Index Sponsor or another entity publishes a successor or
substitute equity index that the Calculation Agent determines, in its sole discretion, to be comparable to the Index (a “Successor Equity Index”), then, upon the Calculation Agent’s notification of that determination to the
Trustee and the Company, the Calculation Agent will substitute the Successor Equity Index as calculated by the Index Sponsor or any other entity and calculate the Ending Level as described above. Upon any selection by the Calculation Agent of a
Successor Equity Index, the Company will cause notice to be given to the Holder of this Security. 
 In the event that the
Index Sponsor discontinues publication of the Index prior to, and the discontinuance is continuing on, the Calculation Day and the Calculation Agent determines that no Successor Equity Index is available at such time, the Calculation Agent will
calculate a substitute Closing Level for the Index in accordance with the formula for and method of calculating the Index last in effect prior to the discontinuance, but using only those securities that comprised the Index immediately prior to that
discontinuance. If a Successor Equity Index is selected or the Calculation Agent calculates a level as a substitute for the Index, the Successor Equity Index or level will be used as a substitute for the Index for all purposes, including the purpose
of determining whether a Market Disruption Event exists. 
 If on the Calculation Day the Index Sponsor fails to
calculate and announce the level of the Index, the Calculation Agent will calculate a substitute Closing Level of the Index in accordance with the formula for and method of calculating the Index last in effect prior to the failure, but using only
those securities that comprised the Index immediately prior to that failure; provided that, if a Market Disruption Event occurs or is continuing on such day, then the provisions set forth above under the definition of “Calculation
Day” shall apply in lieu of the foregoing. 
 If at any time the Index Sponsor makes a material change in the
formula for or the method of calculating the Index, or in any other way materially modifies the Index (other than a modification prescribed in that formula or method to maintain the Index in the event of changes in constituent stock and
capitalization and other routine events), then, from and after that time, the Calculation Agent will, at the close of business in New York, New York, on each date that the Closing Level of the Index is to be calculated, calculate a substitute
Closing Level of the Index in accordance with the formula for and method of calculating the Index last in effect prior to the change, but using only those securities that comprised the Index immediately prior to that change. Accordingly, if the
method of calculating the Index is modified so that the level of the Index is a fraction or a multiple of what it would have been if it had not been modified, then the Calculation Agent will adjust the Index in order to arrive at a level of the
Index as if it had not been modified. 

  
 4 

 Market Disruption Events 

A “Market Disruption Event” means any of (A), (B), (C) or (D) below, as determined by the
Calculation Agent in its sole discretion: 
  

	 	(A)	 Any of the following events occurs or exists with respect to any security included in the Index or any
Successor Equity Index (as defined below), and the aggregate of all securities included in the Index or Successor Equity Index with respect to which any such event occurs comprise 20% or more of the level of the Index or Successor Equity Index:

  

	 	●	 	 a material suspension of or limitation imposed on trading by the Relevant Stock Exchange for such security or
otherwise at any time during the one-hour period that ends at the Scheduled Closing Time for the Relevant Stock Exchange for such security on that day, whether by reason of movements in price exceeding limits permitted by the Relevant Stock Exchange
or otherwise; 

  

	 	●	 	 any event, other than an early closure, that materially disrupts or impairs the ability of market participants
in general to effect transactions in, or obtain market values for, such security on its Relevant Stock Exchange at any time during the one-hour period that ends at the Scheduled Closing Time for the Relevant Stock Exchange for such security on that
day; or 

  

	 	●	 	 the closure on any Exchange Business Day of the Relevant Stock Exchange for such security prior to its
Scheduled Closing Time unless the earlier closing is announced by such Relevant Stock Exchange at least one hour prior to the earlier of (i) the actual closing time for the regular trading session on such Relevant Stock Exchange and
(ii) the submission deadline for orders to be entered into the Relevant Stock Exchange system for execution at the Scheduled Closing Time for such Relevant Stock Exchange on that day. 

 

	 	(B)	 Any of the following events occurs or exists with respect to futures or options contracts relating to the
Index or any Successor Equity Index: 

  

	 	●	 	 a material suspension of or limitation imposed on trading by any Related Futures or Options Exchange or
otherwise at any time during the one-hour period that ends at the close of trading on such Related Futures or Options Exchange on that day, whether by reason of movements in price exceeding limits permitted by the Related Futures or Options Exchange
or otherwise; 

  

	 	●	 	 any event, other than an early closure, that materially disrupts or impairs the ability of market participants
in general to effect transactions in, or obtain market values for, futures or options contracts relating to the Index or Successor Equity Index on any Related Futures or Options Exchange at any time during the one-hour period that ends at the close
of trading on such Related Futures or Options Exchange on that day; or 

  
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	 	●	 	 the closure on any Exchange Business Day of any Related Futures or Options Exchange prior to its Scheduled
Closing Time unless the earlier closing time is announced by such Related Futures or Options Exchange at least one hour prior to the earlier of (i) the actual closing time for the regular trading session on such Related Futures or Options
Exchange and (ii) the submission deadline for orders to be entered into the Related Futures or Options Exchange system for execution at the close of trading for such Related Futures or Options Exchange on that day. 

 

	 	(C)	 The relevant index sponsor fails to publish the level of the Index or any Successor Equity Index (other than
as a result of the relevant index sponsor having discontinued publication of the Index or Successor Equity Index and no Successor Equity Index being available). 

 

	 	(D)	 Any Related Futures or Options Exchange fails to open for trading during its regular trading session.

 For purposes of determining whether a Market Disruption Event has occurred: 

 

	 	(1)	 the relevant percentage contribution of a security included in the Index or any Successor Equity Index to the
level of such index will be based on a comparison of (x) the portion of the level of such index attributable to that security to (y) the overall level of such index, in each case using the official opening weightings as published by the
relevant index sponsor as part of the market opening data; 

  

	 	(2)	 the “Scheduled Closing Time” of any Relevant Stock Exchange or Related Futures or Options
Exchange on any Trading Day means the scheduled weekday closing time of such Relevant Stock Exchange or Related Futures or Options Exchange on such Trading Day, without regard to after hours or any other trading outside the regular trading session
hours; and 

  

	 	(3)	 an “Exchange Business Day” means any Trading Day on which (i) the relevant index sponsor
publishes the level of the Index or any Successor Equity Index and (ii) each Related Futures or Options Exchange is open for trading during its regular trading session, notwithstanding any Related Futures or Options Exchange closing prior to
its Scheduled Closing Time. 

 Calculation Agent 

The Calculation Agent will determine the Redemption Amount and the Ending Level. In addition, the Calculation Agent will
(i) determine if adjustments are required to the Closing Level of the Index under the circumstances described in this Security, (ii) if publication of the Index is discontinued, select a Successor Equity Index or, if no Successor Equity
Index is available, determine the Closing Level of the Index under the circumstances described in this Security, and (iii) determine whether a Market Disruption Event or non-Trading Day has occurred. 

  
 6 

 The Company covenants that, so long as this Security is Outstanding, there shall
at all times be a Calculation Agent (which shall be a broker-dealer, bank or other financial institution) with respect to this Security. 

All determinations made by the Calculation Agent with respect to this Security will be at the sole discretion of the
Calculation Agent and, in the absence of manifest error, will be conclusive for all purposes and binding on the Company and the Holder of this Security. 

Tax Considerations 

The Company agrees, and by acceptance of a beneficial ownership interest in this Security each Holder of this Security will be
deemed to have agreed (in the absence of a statutory, regulatory, administrative or judicial ruling to the contrary), for United States federal income tax purposes to characterize and treat this Security as a prepaid derivative contract that is an
“open transaction.” 
 Redemption and Repayment 

This Security is not subject to redemption at the option of the Company or repayment at the option of the Holder hereof prior
to September 8, 2020. This Security is not entitled to any sinking fund. 
 Acceleration 

If an Event of Default, as defined in the Indenture, with respect to this Security shall occur and be continuing, the
Redemption Amount (calculated as set forth in the next sentence) of this Security may be declared due and payable in the manner and with the effect provided in the Indenture. The amount payable to the Holder hereof upon any acceleration permitted
under the Indenture will be equal to the Redemption Amount hereof calculated as provided herein as though the date of acceleration was the Calculation Day. 
  

 

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place. 
 Unless the certificate of authentication
hereon has been executed by the Trustee referred to on the reverse hereof by manual signature or its duly authorized agent under the Indenture referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose. 
 [The remainder of this page has been left intentionally blank] 

  
 7 

 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed
under its corporate seal. 

DATED:                         
      
  

					
	WELLS FARGO & COMPANY
		
	By:	 	 
		 	
		 	Its:	 	

 [SEAL] 
  

					
	Attest:	 	 
		
		 	
		 	 Its:
	 	

 TRUSTEE’S CERTIFICATE OF 

AUTHENTICATION 
 This is one of the Securities of the 

series designated therein described 
 in the within-mentioned Indenture. 
 CITIBANK, N.A., 

as Trustee 
  

			
		
	By:	 	 
		 	 Authorized Signature

 OR 
  

			
	 WELLS FARGO BANK, N.A.,

  as Authenticating Agent for the Trustee

		
	By:	 	 
		 	 Authorized Signature

  
 8 

 [Reverse of Note] 

WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES K 

Due Nine Months or More From Date of Issue 

Principal at Risk Securities Linked to the EURO STOXX 50® Index 

due September 8, 2020 

This Security is one of a duly authorized issue of securities of the Company (herein called the
“Securities”), issued and to be issued in one or more series under an indenture dated as of July 21, 1999, as amended or supplemented from time to time (herein called the “Indenture”), between the Company and
Citibank, N.A., as Trustee (herein called the “Trustee,” which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is
one of the series of the Securities designated as Medium-Term Notes, Series K, of the Company, which series is limited to an aggregate principal amount or face amount, as applicable, of $25,000,000,000 or the equivalent thereof in one or more
foreign or composite currencies. The amount payable on the Securities of this series may be determined by reference to the performance of one or more equity-, commodity- or currency-based indices, exchange traded funds, securities, commodities,
currencies, statistical measures of economic or financial performance, or a basket comprised of two or more of the foregoing, or any other market measure or may bear interest at a fixed rate or a floating rate. The Securities of this series may
mature at different times, be redeemable at different times or not at all, be repayable at the option of the Holder at different times or not at all and be denominated in different currencies. 

Article Sixteen of the Indenture shall not apply to this Security. 

The Securities are issuable only in registered form without coupons and will be either
(a) book-entry securities represented by one or more Global Securities recorded in the book-entry system maintained by the Depositary or (b) certificated
securities issued to and registered in the names of, the beneficial owners or their nominees. 
 The Company agrees, to the
extent permitted by law, not to voluntarily claim the benefits of any laws concerning usurious rates of interest against a Holder of this Security. 

Modification and Waivers 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights
and obligations of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in principal amount of the
Securities at the 

  
 9 

 
time Outstanding of all series to be affected, acting together as a class. The Indenture also contains provisions permitting the Holders of a majority in principal amount of the Securities of all
series at the time Outstanding affected by certain provisions of the Indenture, acting together as a class, on behalf of the Holders of all Securities of such series, to waive compliance by the Company with those provisions of the Indenture. Certain
past defaults under the Indenture and their consequences may be waived under the Indenture by the Holders of a majority in principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such
series. Solely for the purpose of determining whether any consent, waiver, notice or other action or Act to be taken or given by the Holders of Securities pursuant to the Indenture has been given or taken by the Holders of Outstanding Securities in
the requisite aggregate principal amount, the principal amount of this Security will be deemed to be equal to the amount set forth on the face hereof as the “Face Amount” hereof. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Security. 
 Defeasance 

Section 403 and Article Fifteen of the Indenture and the provisions of clause (ii) of Section 401(1)(B) of the
Indenture, relating to defeasance at any time of (a) the entire indebtedness on this Security and (b) certain restrictive covenants and certain Events of Default, upon compliance by the Company with certain conditions set forth therein,
shall not apply to this Security. The remaining provisions of Section 401 of the Indenture shall apply to this Security. 
 Authorized
Denominations 
 This Security is issuable only in registered form without coupons in denominations of $1,000 or any
amount in excess thereof which is an integral multiple of $1,000. 
 Registration of Transfer 

Upon due presentment for registration of transfer of this Security at the office or agency of the Company in the City of
Minneapolis, Minnesota, a new Security or Securities of this series, with the same terms as this Security, in authorized denominations for an equal aggregate Face Amount will be issued to the transferee in exchange herefor, as provided in the
Indenture and subject to the limitations provided therein and to the limitations described below, without charge except for any tax or other governmental charge imposed in connection therewith. 

This Security is exchangeable for definitive Securities in registered form only if (x) the Depositary notifies the
Company that it is unwilling or unable to continue as Depositary for this Security or if at any time the Depositary ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, and a successor depositary is not
appointed within 90 days after the Company receives such notice or becomes aware of such ineligibility, (y) the Company in its sole discretion determines that this Security shall be exchangeable for definitive Securities in registered form
and notifies the Trustee thereof or (z) an Event of Default with respect to the Securities represented hereby has occurred and is continuing. If this Security is exchangeable pursuant to the preceding sentence, it shall be exchangeable for
definitive Securities in registered 

  
 10 

 
form, having the same date of issuance, Stated Maturity Date and other terms and of authorized denominations aggregating a like amount. 

This Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor of the Depositary or a nominee of such successor. Except as provided above, owners of beneficial interests in this Global
Security will not be entitled to receive physical delivery of Securities in definitive form and will not be considered the Holders hereof for any purpose under the Indenture. 

Prior to due presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the
contrary. 
 Obligation of the Company Absolute 

No reference herein to the Indenture and no provision of this Security or the Indenture shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the Redemption Amount at the times, place and rate, and in the coin or currency, herein prescribed, except as otherwise provided in this Security. 

No Personal Recourse 

No recourse shall be had for the payment of the Redemption Amount, or for any claim based hereon, or otherwise in respect
hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer or director, as such, past, present or future, of the Company or any successor corporation, whether by virtue of
any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issuance hereof, expressly waived and released.

 Defined Terms 

All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture
unless otherwise defined in this Security. 
 Governing Law 

This Security shall be governed by and construed in accordance with the law of the State of New York, without regard to
principles of conflicts of laws. 

  
 11 

 ABBREVIATIONS 

The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they
were written out in full according to applicable laws or regulations: 
  

					
	 TEN COM
	  	 --
	  	 as tenants in common

			
	 TEN ENT
	  	 --
	  	 as tenants by the entireties

			
	 JT TEN
	  	 --
	  	 as joint tenants with right

of survivorship and not
 as
tenants in common

  

							
	
UNIF GIFT MIN ACT --  
	  	 	  	 Custodian  
	  	 
		  	(Cust)	  		  	(Minor)

 Under Uniform Gifts to Minors Act 
  

 
 (State)

 Additional abbreviations may also be used though not in the above list. 

FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto 

Please Insert Social Security or 
 Other Identifying Number of
Assignee 
  
  

 

	
	
	 
	
	 
	
	 
	(PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP
CODE OF ASSIGNEE)

  
 12 

 the within Security of WELLS FARGO & COMPANY and does hereby irrevocably constitute and
appoint                                      attorney to
transfer the said Security on the books of the Company, with full power of substitution in the premises. 
  

			
		
	Dated:	 	 
		 	

  

	
	
	 
	
	 

 NOTICE: The signature to this assignment must correspond with the name as written upon the face of the
within instrument in every particular, without alteration or enlargement or any change whatever. 

  
 13

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