Document:

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                                                                   EXHIBIT 10.17

                                 PROMISSORY NOTE

BORROWER: OCM Development, LLC            LENDER: Independent Bank West Michigan
          1971 E. Beltline Avenue,                4200 E. Beltline NE
          Suite 200                               Grand Rapids, MI 49525
          Grand Rapids, MI 49525                  (616) 363-1207

PRINCIPAL AMOUNT: _________   INITIAL RATE: _________   DATE OF NOTE: __________

PROMISE TO PAY. OCM Development, LLC ("Borrower") promises to pay Independent
Bank West Michigan ("Lender"), or order, in lawful money of the United States of
America, the principal amount of __________________ ($___________) or so much as
may be outstanding, together with interest on the unpaid outstanding principal
balance of each advance. Interest shall be calculated from the date of each
advance until repayment of each advance. The interest rate will not increase
above 24.000%.

PAYMENT: Subject to any payment changes resulting from changes in the Index,
Borrower will pay this loan in accordance with the following payment schedule: 6
monthly consecutive interest payments, beginning ____________, with interest
calculated on the unpaid principal balances at an interest rate based on the
National Prime Rate, as published in the Wall Street Journal from time to time,
{if published in a range, the highest number in the range will be used}
(currently ______), resulting in an initial interest rate of _____%; and one
principal and interest payment of $_________ on ___________ with interest
calculated on the unpaid principal balances at an interest rate based on the
National Prime Rate, as published in the Wall Street Journal from time to time,
{if published in a range, the highest number in the range will be used}
(currently _____%), resulting in an initial interest rate of _____%. This
estimated final payment is based on the assumption that all payments will be
made exactly as scheduled and that the Index does not change; the actual final
payment will be for all principal and accrued interest not yet paid, together
with any other unpaid amounts under this Note. Unless otherwise agreed or
required by applicable law, payments will be applied first to any accrued unpaid
interest; then to principal; then to any unpaid collection costs; and then to
any late charges. The annual interest rate for this Note is computed on a
365/360 basis; that is, by applying the ratio of the annual interest rate over a
year of 360 days, multiplied by the outstanding principal balance, multiplied by
the actual number of days the principal balance is outstanding. Borrower will
pay Lender at Lender's address shown above or at such other place as Lender may
designate in writing.

VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from
time to time based on changes in an independent index which is the National
Prime Rate, as published in the Wall Street Journal from time to time, {if
published in a range, the highest number in the range will be used} (the
"Index"). The Index is not necessarily the lowest rate charged by Lender on its
loans. If the Index becomes unavailable during the term of this loan, Lender may
designate a substitute index after notice to Borrower. Lender will tell Borrower
the current index rate upon Borrower's request. The interest rate change will
not occur more often than each day. Borrower understands that Lender may make
loans based on other rates as well. The Index currently is ______% per annum.
The interest rate or rates to be applied to the unpaid principal balance of this
Note will be the rate or rates set forth herein in the "Payment" section.
Notwithstanding any other provision of this Note, after the first payment
stream, the interest rate for each subsequent payment stream will be effective
as of the last payment date of the just-ending payment stream. Notwithstanding
the foregoing, the variable interest rate or rates provided for in this Note
will be subject to the following maximum rate. NOTICE: Under no circumstances
will the interest rate on this Note be more than (except for any higher default
rate shown below) the lesser of 24.000% per annum or the maximum rate allowed by
applicable law. Whenever increases occur in the interest rate, Lender, at its
option, may do one or more of the following: (A) increase Borrower's payments to
ensure Borrower's loan will pay off by its original final maturity date, (B)
increase Borrower's payments to cover accruing interest, (C) increase the number
of Borrower's payments, and (D) continue Borrower's payments at the same amount
and increase Borrower's final payment.

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                                PROMISSORY NOTE
                                  (CONTINUED)

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PREPAYMENT. Borrower may pay without penalty all or a portion of the amount owed
earlier than it is due. Early payments will not, unless agreed to by Lender in
writing, relieve Borrower of Borrower's obligation to continue to make payments
under the payment schedule. Rather, early payments will reduce the principal
balance due and may result in Borrower's making fewer payments. Borrower agrees
not to send Lender payments marked "paid in full", "without recourse", or
similar language. If Borrower sends such a payment, Lender may accept it without
losing any of Lender's rights under this Note, and Borrower will remain
obligated to pay any further amount owed to Lender. All written communications
concerning disputed amounts, including any check or other payment instrument
that indicates that the payment constitutes "payment in full" of the amount owed
or that is tendered with other conditions or limitations or as full satisfaction
of a disputed amount must be mailed or delivered to: Independent Bank West
Michigan, 4200 E. Beltline NE, Grand Rapids, MI 49525.

LATE CHARGE. If a payment is 15 days or more late, Borrower will be charged
5.000% of the regularly scheduled payment or $15.00, whichever is greater.

INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final
maturity, Lender, at its option, may, if permitted under applicable law,
increase the variable interest rate on this Note to 24.000% per annum. The
interest rate will not exceed the maximum rate permitted by applicable law.

DEFAULT. Each of the following shall constitute an event of default ("Event of
Default") under this Note:

PAYMENT DEFAULT. Borrower fails to make any payment when due under this Note.

OTHER DEFAULTS. Borrower fails to comply with or to perform any other term,
obligation, covenant or condition contained in this Note or in any of the
related docuemtns or to comply with or to perform any term, obligation, covenant
or condition contained in any other agreement between Lender and Borrower.

FALSE STATEMENTS. Any warranty, representation or statement made or furnished to
Lender by Borrower or on Borrower's behalf under this Note or the related
documents is false or misleading in any material respect, either now or at the
time made or furnished or becomes false or misleading at any time thereafter.

DEATH OR INSOLVENCY. The dissolution of Borrower (regardless of whether election
to continue is made), any member withdraws from Borrower, or any other
termination of Borrower's existence as a going business or the death of any
member, the insolvency of Borrower, the appointment of a receiver for any part
of Borrower's property, any assignment for the benefit of creditors, any type of
creditor workout, or the commencement of any proceeding under any bankruptcy or
insolvency laws by or against Borrower.

CREDITOR OR FORFEITURE PROCEEDINGS. Commencement of foreclosure or forfeiture
proceedings, whether by judicial proceeding, self-help, repossession or any
other method, by any creditor of Borrower or by any governmental agency against
any collateral securing the loan. This includes a garnishment of any of
Borrower's accounts, including deposit accounts, with Lender. However, this
Event of Default shall not apply if there is a good faith dispute by Borrower as
to the validity or reasonableness of the claim which is the basis of the
creditor or forfeiture proceeding and if Borrower gives Lender written notice of
the creditor or forfeiture proceeding and deposits with Lender monies or a
surety bond for the creditor or forfeiture proceeding, in an amount determined
by Lender, in its sole discretion, as being an adequate reserve or bond for the
dispute.

EVENTS AFFECTING GUARANTOR. Any of the preceding events occurs with respect to
any Guarantor of any of the indebtedness or any Guarantor dies or becomes
incompetent, or revokes or disputes the validity of, or liability under, any
guaranty of the indebtedness evidenced by this Note.

ADVERSE CHANGE. A material adverse change occurs in Borrower's financial
condition, or Lender believes the prospect of payment or performance of this
Note is impaired.

INSECURITY. Lender in good faith believes itself insecure.

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                                PROMISSORY NOTE
                                  (CONTINUED)

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LENDER'S RIGHTS. Upon default, Lender may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest immediately due, and then
Borrower will pay that amount.

ATTORNEY'S FEES; EXPENSES. Lender may hire or pay someone else to help collect
this Note if Borrower does not pay. Borrower will pay Lender that amount. This
includes, subject to any limits under applicable law, Lender's reasonable
attorneys' fees and Lender's legal expenses whether or not there is a lawsuit,
including reasonable attorneys' fees and expenses for bankruptcy proceedings
(including efforts to modify or vacate any automatic stay or injunction), and
appeals. If not prohibited by applicable law, Borrower also will pay any court
costs, in addition to all other sums provided by law.

JURY WAIVER. Lender and Borrower hereby waive the right to any jury trial in any
action, proceeding, or counterclaim brought by either Lender or Borrower against
the other.

GOVERNING LAW. This Note will be governed by, construed and enforced in
accordance with federal law and the laws of the State of Michigan. This note has
been accepted by Lender in the State of Michigan.

RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a
right of setoff in all Borrower's accounts with Lender (whether checking,
savings, or some other account.) This includes all accounts Borrower holds
jointly with someone else and all accounts Borrower may open in the future.
However, this does not include any IRA or Keogh accounts, or any trust accounts
for which setoff would be prohibited by law. Borrower authorizes Lender, to the
extent permitted by applicable law, to charge or setoff all sums owing on the
indebtedness against any and all such accounts, and, at Lender's option, to
administratively freeze all such accounts to allow Lender to protect Lender's
charge and setoff rights provided in this paragraph.

COLLATERAL. Borrower acknowledges this Note is secured by a Construction
Mortgage. (_____________________), Commercial Security Agreement (furniture and
fixtures), Unlimited Corporate Guaranty of Meritage Hospitality Group Inc. and
Unlimited Guaranty of OCM Food Service, LLC DBA O'Charley's of Michigan secured
by a Commercial Security Agreement for Reassignment of Liquor License all of
even date.

LINE OF CREDIT. This Note evidences a straight line of credit. Once the total
amount of principal has been advanced, Borrower is not entitled to further loan
advances. Borrower agrees to be liable for all sums either: (A) advanced in
accordance with the instructions of an authorized person or (B) credited to any
of Borrower's accounts with Lender. The unpaid principal balance owing on this
Note at any time may be evidenced by endorsements on this Note or by Lender's
internal records, including daily computer print-outs.

ADDITIONAL PROVISIONS. Draws are to be insured by a title insurance company and
supported by contractor's sworn statements and appropriate waiver's of lien.
Draws must also be approved by an independent third party Inspector.

CONDITIONS FOR ADVANCES. Draws will be limited to the first 6 months, no draws
shall be taken after ___________________, at which time this shall be considered
a term Note.

FIXED RATE OPTION. Borrower will have a one time option to fix the interest rate
at the Federal Home Loan Bank Advance Rate for the remaining term plus 2.65%.
Option to fix will carry a cost of .15% of the loan amount and will carry
prepayment penalty as outlined below.

5 year fixed rate 3% in year 1, 2% in year 2, 1% in year 3

7 year fixed rate 3% in years 1-2, 2% in years 3-4, and 1% in year 5

10 year fixed rate 3% in years 1-2, 2% in years 3-4, and 1% in years 5-6

SUCCESSOR INTERESTS. The terms of this Note shall be binding upon Borrower, and
upon Borrower's heirs, personal representatives, successors and assigns, and
shall inure to the benefit of Lender and its successors and assigns.

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                                PROMISSORY NOTE
                                  (CONTINUED)

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NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING AGENCIES.
Please notify us if we report any inaccurate information about your account(s)
to a consumer reporting agency. Your written notice describing the specific
inaccuracy(ies) should be sent to us at the following address: Independent Bank
West Michigan, 4200 E. Beltline NE, Grand Rapids, MI 49525.

GENERAL PROVISIONS. Lender may delay or forgo enforcing any of its rights or
remedies under this Note without losing them. Borrower and any other person who
signs, guarantees or endorses this Note, to the extent allowed by law, waive
presentment, demand for payment, and notice of dishonor. Upon any change in the
terms of this Note, and unless otherwise expressly stated in writing, no party
who signs this Note, whether as maker, guarantor, accommodation maker or
endorser, shall be released from liability. All such parties agree that Lender
may renew or extend (repeatedly and for any length of time) this loan or release
any party or guarantor or collateral; or impair, fail to realize upon or perfect
Lender's security interest in the collateral; and take any other action deemed
necessary by Lender without the consent of or notice to anyone. All such parties
also agree that Lender may modify this loan without the consent of or notice to
anyone other than the party with whom the modification is made. The obligations
under this Note are joint and several.

PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO
THE TERMS OF THE NOTE.

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE.

BORROWER:

OCM DEVELOPMENT, LLC

BY:
    --------------------------------<PAGE>
                                                                   EXHIBIT 10.18

                                    MORTGAGE

THIS MORTGAGE DATED __________________, IS MADE AND EXECUTED BETWEEN OCM
DEVELOPMENT, LLC, A MICHIGAN LIMITED LIABILITY COMPANY, WHOSE ADDRESS IS 1971 E.
BELTLINE AVENUE, SUITE 200, GRAND RAPIDS, MI 49525 (REFERRED TO BELOW AS
"GRANTOR") AND INDEPENDENT BANK WEST MICHIGAN, WHOSE ADDRESS IS 4200 E. BELTLINE
NE, GRAND RAPIDS, MI 49525 (REFERRED TO BELOW AS "LENDER").

GRANT OF MORTGAGE. FOR VALUABLE CONSIDERATION, GRANTOR mortgages and warrants to
Lender all of Grantor's right, title, and interest in and to the following
described real property, together with all existing or subsequently erected or
affixed buildings, improvements and fixtures; all easements, rights of way, and
appurtenances; all rights to make divisions of the land that are exempt from the
platting requirements of the Michigan Land Division Act, as it shall be amended;
all water, water rights, watercourses and ditch rights (including stock in
utilities with ditch or irrigation rights); and all other rights, royalties, and
profits relating to the real property, including without limitation all
minerals, oil, gas, geothermal and similar matters, (THE "REAL PROPERTY")
LOCATED IN MACOMB COUNTY, STATE OF MICHIGAN:

     SEE EXHIBIT TO CONSTRUCTION MORTGAGE AND NOTICE OF COMMENCEMENT, WHICH IS
     ATTACHED TO THIS MORTGAGE AND MADE A PART OF THIS MORTGAGE AS IF FULLY SET
     FORTH HEREIN.

THE REAL PROPERTY OR ITS ADDRESS IS COMMONLY KNOWN AS _________________________
___________________.

THE REAL PROPERTY TAX IDENTIFICATION NUMBER IS _____________.

Grantor presently assigns to Lender all of Grantor's right, title, and interest
in and to all present and future leases of the Property and all Rents from the
Property. In addition, Grantor grants to Lender a Uniform Commercial Code
security interest in the Personal Property and Rents.

THIS MORTGAGE, INCLUDING THE ASSIGNMENT OF RENTS AND THE SECURITY INTEREST IN
THE RENTS AND PERSONAL PROPERTY, IS GIVEN TO SECURE (A) PAYMENT OF THE
INDEBTEDNESS AND (B) PERFORMANCE OF ANY AND ALL COVENANTS AND OBLIGATIONS UNDER
THE NOTE, THE RELATED DOCUMENTS, AND THIS MORTGAGE. THIS MORTGAGE, INCLUDING THE
ASSIGNMENT OF RENTS AND THE SECURITY INTEREST IN THE RENTS AND PERSONAL
PROPERTY, IS ALSO GIVEN TO SECURE ANY AND ALL OF GRANTOR'S OBLIGATIONS UNDER
THAT CERTAIN CONSTRUCTION LOAN AGREEMENT BETWEEN GRANTOR AND LENDER OF EVEN DATE
HEREWITH. ANY EVENT OF DEFAULT UNDER THE CONSTRUCTION LOAN AGREEMENT, OR ANY OF
THE RELATED DOCUMENTS REFERRED TO THEREIN, SHALL ALSO BE AN EVENT OF DEFAULT
UNDER THIS MORTGAGE. THIS MORTGAGE IS GIVEN AND ACCPTED ON THE FOLLOWING TERMS
AND COVENANTS:

PAYMENT AND PERFORMANCE. Except as otherwise provided in this Mortgage, Grantor
shall pay to Lender all amounts secured by this Mortgage as they become due and
shall strictly perform all of Grantor's obligations under this Mortgage.

POSSESSION AND MAINTENANCE OF THE PROPERTY. Grantor and Lender agree that
Grantor's possession and use of the Property shall be governed by the following
provisions:

POSSESSION AND USE. Until the occurrence of an Event of Default, Grantor may (1)
remain in possession and control of the Property; (2) use, operate or manage the
Property; and (3) collect the Rents from the Property.

DUTY TO MAINTAIN. Grantor shall maintain the Property in tenantable condition
and promptly perform all repairs, replacements, and maintenance necessary to
preserve its value.

COMPLIANCE WITH ENVIRONMENTAL LAWS. Grantor represents and warrants to Lender
that: (1) During the period of Grantor's ownership of the Property, there has
been no use, generation, manufacture, storage, treatment, disposal, release or
threatened release of any Hazardous Substance by any person on, under, about or
from the Property; (2) Grantor has no knowledge of, or reason to believe that
there has been, except as previously disclosed to and acknowledged by Lender in

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                                    MORTGAGE
                                   (CONTINUED)

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writing, (a) any breach or violation of any Environmental Laws, (b) any use,
generation, manufacture, storage, treatment, disposal, release or threatened
release of any Hazardous Substance on, under, about or from the Property by any
prior owners or occupants of the Property, or (c) any actual or threatened
litigation or claims of any kind by any person relating to such matters; and (3)
Except as previously disclosed to and acknowledged by Lender in writing, (a)
neither Grantor nor any tenant, contractor, agent or other authorized user of
the Property shall use, generate, manufacture, store, treat, dispose of or
release any Hazardous Substance, on under about or from the Property; and (b)
any such activity shall be conducted in compliance with all applicable federal,
state, and local laws, regulations and ordinances, including without limitation
all Environmental Laws. Grantor authorizes Lender and its agents to enter upon
the Property to make such inspections and tests, at Grantor's expense, as Lender
may deem appropriate to determine compliance of the Property with this section
of the Mortgage. Any inspections or tests made by Lender shall be for Lender's
purposes only and shall not be construed to create any responsibility or
liability on the part of Lender to Grantor or to any other person. The
representations and warranties contained herein are based on Grantor's due
diligence in investigating the Property for Hazardous Substances. Grantor hereby
(1) releases and waives any future claims against Lender for indemnity or
contribution in the event Grantor becomes liable for cleanup or other costs
under any such laws; and (2) agrees to indemnify and hold harmless Lender
against any and all claims, losses, liabilities, damages, penalties, and
expenses which Lender may directly or indirectly sustain or suffer resulting
from a breach of this section of the Mortgage or as a consequence of any use,
generation, manufacture, storage, disposal, release or threatened release
occurring prior to Grantor's ownership or interest in the Property, whether or
not the same was or should have been known to Grantor. The provisions of this
section of the Mortgage, including the obligation to indemnify, shall survive
the payment of the Indebtedness and the satisfaction and reconveyance of the
lien of this Mortgage and shall not be affected by Lender's acquisition of any
interest in the Property, whether by foreclosure or otherwise.

NUISANCE, WASTE. Grantor shall not cause, conduct or permit any nuisance nor
commit, permit, or suffer any stripping of or waste on or to the Property or any
portion of the Property. Without limiting the generality of the foregoing,
Grantor will not remove, or grant to any other party the right to remove, any
timber, minerals (including oil and gas), coal, clay, scoria, soil, gravel or
rock products without Lender's prior written consent.

REMOVAL OF IMPROVEMENTS. Grantor shall not demolish or remove any Improvements
from the Real Property without Lender's prior written consent. As a condition to
the removal of any Improvements, Lender may require Grantor to make arrangements
satisfactory to Lender to replace such Improvements with Improvements of at
least equal value.

LENDER'S RIGHT TO ENTER. Lender and Lender's agents and representatives may
enter upon the Real Property at all reasonable times (a) attend to Lender's
interests, (b) inspect the Property for purposes of Grantor's compliance with
the terms and conditions of this Mortgage, (c) appraise the property, (d)
investigate whether the property is a site or source of environmental
contamination, or (e) remove to remediate any environmental contamination.
Without limiting the foregoing, Lender shall have the right to conduct and
submit to appropriate governmental agencies a "baseline environmental
assessment" of the property within the meaning of section 20101 of the Michigan
Natural Resources and Environmental Protection Act, MCL section 324.20101, as it
shall be amended from time to time. If, at the time of the appraisal,
investigation, assessment, removal, or remediation, there shall have occurred
and be continuing an Event of Default, then all costs and expenses of the
appraisal, investigation, assessment, removal or remediation, shall be subject
to the "Expenditures by Lender" section of this Mortgage. Grantor shall execute
any consultant contract, waste manifest, notice, and other documents that Lender
requests to enable Lender to take or conduct any action or activity contemplated
by this paragraph, if Grantor is given a reasonable opportunity to negotiate the
terms of the contract, manifest, notice, or other document.

COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS. Grantor shall promptly comply with
all laws, ordinances, and regulations, now or hereafter in effect, of all
governmental authorities applicable to the use or occupancy of the Property,
including without limitation, the Americans With Disabilities Act. Grantor may
contest in good faith any such law, ordinance, or regulation and withhold
compliance during any proceeding, including appropriate appeals, so long as
Grantor has notified Lender in writing prior to doing so and so long as, in
Lender's sole opinion, Lender's interests in the Property are not jeopardized.
Lender may require Grantor to post adequate security or a surety bond,
reasonably satisfactory to Lender, to protect Lender's interest.

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                                    MORTGAGE
                                   (CONTINUED)

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DUTY TO PROTECT. Grantor agrees neither to abandon or leave unattended the
Property. Grantor shall do all other acts, in addition to those acts set forth
above in this section, which from the character and use of the Property are
reasonably necessary to protect and preserve the Property.

CONSTRUCTION LOAN. If some or all of the proceeds of the loan creating the
Indebtedness are to be used to construct or complete construction of any
Improvements on the Property, the Improvements shall be completed no later than
the maturity date of the Note (or such earlier date as Lender may reasonably
establish) and Grantor shall pay in full all costs and expenses in connection
with the work. Lender will disburse loan proceeds under such terms and
conditions as Lender may deem reasonably necessary to insure that the interest
created by this Mortgage shall have priority over all possible liens, including
those of material suppliers and workmen. Lender may require, among other things,
that disbursement requests be supported by receipted bills, expense affidavits,
waivers of liens, construction progress reports, and such other documentation as
Lender may reasonably request.

TAXES AND LIENS. The following provisions relating to the taxes and liens on the
Property are part of this Mortgage:

PAYMENT. Grantor shall pay when due (and in all events prior to delinquency) all
taxes, payroll taxes, special taxes, assessments, water charges and sewer
service charges levied against or on account of the Property, and shall pay when
due all claims for work done on or for services rendered or material furnished
to the Property. Grantor shall maintain the Property free of any liens having
priority over or equal to the interest of Lender under this Mortgage, except for
those liens specifically agreed to in writing by Lender, and except for the lien
of taxes and assessments not due as further specified in the Right to Contest
paragraph.

RIGHT TO CONTEST. Grantor may withhold payment of any tax, assessment, or claim
in connection with a good faith dispute over the obligation to pay, so long as
Lender's interest in the Property is not jeopardized. If a lien arises or is
filed as a result of nonpayment, Grantor shall within fifteen (15) days after
the lien arises or, if a lien is filed, within fifteen (15) days after Grantor
has notice of the filing, secure the discharge of the lien, or if requested by
Lender, deposit with Lender cash or a sufficient corporate surety bond or other
security satisfactory to Lender in an amount sufficient to discharge the lien
plus any costs and reasonable attorneys' fees, or other charges that could
accrue as a result of a foreclosure or sale under the lien. In any contest,
Grantor shall defend itself and Lender and shall satisfy any adverse judgment
before enforcement against the Property. Grantor shall name Lender as an
additional obligee under any surety bond furnished in the contest proceedings.

EVIDENCE OF PAYMENT. Grantor shall upon demand furnish to Lender satisfactory
evidence of payment of the taxes or assessments and shall authorize the
appropriate governmental official to deliver to Lender at any time a written
statement of the taxes and assessments against the Property.

NOTICE OF CONSTRUCTION. Grantor shall notify Lender at least fifteen (15) days
before any work is commenced, any services are furnished, or any materials are
supplied to the Property, if any mechanic's lien, materialmen's lien, or other
lien could be asserted on account of the work, services, or materials. Grantor
will upon request of Lender furnish to Lender advance assurances satisfactory to
Lender that Grantor can and will pay the cost of such improvements.

PROPERTY DAMAGE INSURANCE. The following provisions relating to insuring the
Property are a part of this Mortgage:

MAINTENANCE OF INSURANCE. Grantor shall procure and maintain policies of fire
insurance with standard extended coverage endorsements on a replacement basis
for the full insurable value covering all Improvements on the Real Property in
an amount sufficient to avoid application of any coinsurance clause, and with a
standard mortgagee clause in favor of Lender. Grantor shall also procure and
maintain comprehensive general liability insurance in such coverage amounts as
Lender may request with Lender being named as additional insureds in such
liability insurance policies. Additionally, Grantor shall maintain such other
insurance, including but not limited to hazard, business interruption and boiler
insurance as Lender may require. Policies shall be written by such insurance
companies and in such form as may be reasonably acceptable to Lender. Grantor
shall deliver to Lender certificates of coverage from each insurer containing a
stipulation that coverage will not be cancelled or diminished without a minimum
of thirty (30) days' prior written notice to Lender

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                                    MORTGAGE
                                   (CONTINUED)

                                                                          PAGE 4

and not containing any disclaimer of the insurer's liability for failure to give
such notice. Each insurance policy also shall include an endorsement providing
that coverage in favor of Lender will not be impaired in any way by any act,
omission or default of Grantor or any other person. Should the Real Property be
located in an area designated by the Director of the Federal Emergency
Management Agency as a special flood hazard area, Grantor agrees to obtain and
maintain Federal Flood Insurance, if available, within 45 days after notice is
given by Lender that the Property is located in a special flood hazard area, for
the full unpaid principal balance of the loan and any prior liens on the
property securing the loan, up to the maximum policy limits set under the
National Flood Insurance Program, or as otherwise required by Lender, and to
maintain such insurance for the term of the loan.

APPLICATION OF PROCEEDS. Grantor shall promptly notify Lender of any loss or
damage to the Property. Lender may make proof of loss if Grantor fails to do so
within fifteen (15) days of the casualty. Whether or not Lender's security is
impaired, Lender may, at Lender's election, receive and retain the proceeds of
any insurance and apply the proceeds to the reduction of the Indebtedness,
payment of any lien affecting the Property, or the restoration and repair of the
Property. If Lender elects to apply the proceeds to restoration and repair,
Grantor shall repair or replace the damaged or destroyed Improvements in a
manner satisfactory to Lender. Lender shall, upon satisfactory proof of such
expenditure, pay or reimburse Grantor from the proceeds for the reasonable cost
of repair or restoration if Grantor is not in default under this Mortgage.

Any proceeds which have not been disbursed within 180 days after their receipt
and which Lender has not committed to the repair or restoration of the Property
shall be sued first to pay any amount owing to Lender under this Mortgage, then
to pay accrued interest, and the remainder, if any, shall be applied to the
principal balance of the Indebtedness. If Lender holds any proceeds after
payment in full of the Indebtedness, such proceeds shall be paid to Grantor as
Grantor's interests may appear.

GRANTOR'S REPORT ON INSURANCE. Upon request of Lender, however not more than
once a year, Grantor shall furnish to Lender a report on each existing policy of
insurance showing: (1) the name of the insurer; (2) the risks insured; (3) the
amount of the policy; (4) the property insured, the then current replacement
value of such property, and the manner of determining that value; and (5) the
expiration date of the policy. Grantor shall, upon request of Lender, have an
independent appraiser satisfactory to Lender determine the cash value
replacement cost of the Property.

LENDER'S EXPENDITURES. If any action or proceeding is commenced that would
materially affect Lender's interest in the Property or if Grantor fails to
comply with any provision of this Mortgage or any Related Documents, including
but not limited to Grantor's failure to discharge or pay when due any amounts
Grantor is required to discharge or pay under this Mortgage or any Related
Documents, Lender on Grantor's behalf may (but shall not be obligated to) take
any action that Lender deems appropriate, including but not limited to
discharging or paying all taxes, liens, security interests, encumbrances and
other claims, at any time levied or placed on the Property and paying all costs
for insuring, maintaining and preserving the Property. All such expenditures
incurred or paid by Lender for such purposes will then bear interest at the rate
charged under the Note from the date incurred or paid by Lender to the date of
repayment by Grantor. All such expenses will become a part of the Indebtedness
and, at Lender's option, will (A) be payable on demand; (B) be added to the
balance of the Note and be apportioned among and be payable with any installment
payments to become due during either (1) the term of any applicable insurance
policy; or (2) the remaining term of the Note; or (C) be treated as a balloon
payment which will be due and payable at the Note's maturity. The Mortgage also
will secure payment of these amounts. Such right shall be in addition to all
other rights and remedies to which Lender may be entitled upon Default.

WARRANTY; DEFENSE OF TITLE. The following provisions relating to ownership of
the Property are a part of this Mortgage:

TITLE. Grantor warrants that: (a) Grantor hold good and marketable title of
record to the Property in fee simple, free and clear of all liens and
encumbrances other than those set forth in the Real Property description or in
any title insurance policy, title report, or final title opinion issued in favor
of, and accepted by, Lender in connection with this Mortgage, and (b) Grantor
has the full right, power, and authority to execute and deliver this Mortgage to
Lender.

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                                    MORTGAGE
                                   (CONTINUED)

                                                                          PAGE 5

DEFENSE OF TITLE. Subject to the exception in the paragraph above, Grantor
warrants and will forever defend the title to the Property against the lawful
claims of all persons. In the event any action or proceeding is commenced that
questions Grantor's title or the interest of Lender under this Mortgage, Grantor
shall defend the action at Grantor's expense. Grantor may be the nominal party
in such proceeding, but Lender shall be entitled to participate in the
proceeding and to be represented in the proceeding by counsel of Lender's own
choice, and Grantor will deliver, or cause to be delivered, to Lender such
instruments as Lender may request from time to time to permit such
participation.

COMPLIANCE WITH LAWS. Grantor warrants that the Property and Grantor's use of
the Property complies with all existing applicable laws, ordinances, and
regulations of governmental authorities.

SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations, warranties, and
agreements made by Grantor in this Mortgage shall survive the execution and
delivery of this Mortgage, shall be continuing in nature, and shall remain in
full force and effect until such time as Grantor's Indebtedness shall be paid in
full.

CONDEMNATION. The following provisions relating to condemnation proceedings are
a part of this Mortgage:

PROCEEDINGS. If any proceeding in condemnation is filed, Grantor shall promptly
notify Lender in writing, and Grantor shall promptly take such steps as may be
necessary to defend the action and obtain the award. Grantor may be the nominal
party in such proceeding, but Lender shall be entitled to participate in the
proceeding and to be represented in the proceeding by counsel of its own choice,
and Grantor will deliver or cause to be delivered to Lender such instruments and
documentation as may be requested by Lender from time to time to permit such
participation.

APPLICATION OF NET PROCEEDS. If all or any part of the Property is condemned by
eminent domain proceedings or by any proceeding or purchase in lieu of
condemnation, Lender may at its election require that all or any portion of the
net proceeds of the award be applied to the Indebtedness or the repair or
restoration of the Property. The net proceeds of the award shall mean the award
after payment of all reasonable costs, expenses, and attorneys' fees incurred by
Lender in connection with the condemnation.

IMPOSITION OF TAXES, FEES AND CHARGES BY GOVERNMENTAL AUTHORITIES. The following
provisions relating to governmental taxes, fees and charges are a part of this
Mortgage:

CURRENT TAXES, FEES AND CHARGES. Upon request by Lender, Grantor shall execute
such documents in addition to this Mortgage and take whatever other action is
requested by Lender to perfect and continue Lender's lien on the Real Property.
Grantor shall reimburse Lender for all taxes, as described below, together with
all expenses incurred in recording, perfecting or continuing this Mortgage,
including without limitation all taxes, fees, documentary stamps, and other
charges for recording or registering this Mortgage.

TAXES. The following shall constitute taxes to which this section applies: (1) a
specific tax upon this type of Mortgage or upon all or any part of the
Indebtedness secured by this Mortgage; (2) a specific tax on Grantor which
Grantor is authorized or required to deduct from payments on the Indebtedness
secured by this type of Mortgage; (3) a tax on this type of Mortgage chargeable
against the Lender or the holder of the Note; and (4) a specific tax on all or
any portion of the Indebtedness or on payments of principal and interest made by
Grantor.

SUBSEQUENT TAXES. If any tax to which this section applies is enacted subsequent
to the date of this Mortgage, this event shall have the same effect as an Event
of Default, and Lender may exercise any or all of its available remedies for an
Event of Default as provided below unless Grantor either (1) pays the tax before
it becomes delinquent, or (2) contests the tax as provided above in the Taxes
and Liens section and deposits with Lender cash or a sufficient corporate surety
bond or other security satisfactory to Lender.

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                                    MORTGAGE
                                   (CONTINUED)

                                                                          PAGE 6

SECURITY AGREEMENT; FINANCING STATEMENTS. The following provisions relating to
this Mortgage as a security agreement are a part of this Mortgage:

SECURITY AGREEMENT. This instrument shall constitute a Security Agreement to the
extent any of the Property constitutes fixtures, and Lender shall have all of
the rights of a secured party under the Uniform Commercial Code as amended from
time to time.

SECURITY INTEREST. Upon request by Lender, Grantor shall execute financing
statements and take whatever other action is requested by Lender to perfect and
continue Lender's security interest in the Personal Property. In addition to
recording this Mortgage in the real property records, Lender may, at any time
and without further authorization from Grantor, file executed counterparts,
copies or reproduction of this Mortgage as a financing statement. Grantor shall
reimburse Lender for all expenses incurred in perfecting or continuing this
security interest. Upon default, Grantor shall not remove, sever or detach the
Personal Property from the Property. Upon default, Grantor shall assemble any
Personal Property not affixed to the Property in a manner and at a place
reasonably convenient to Grantor and Lender and make it available to Lender
within three (3) days after receipt of written demand from Lender to the extent
permitted by applicable law.

ADDRESSES. The mailing addresses of Grantor (debtor) and Lender (secured party)
from which information concerning the security interest granted by this Mortgage
may be obtained (each as required by the Uniform Commercial Code) are as stated
on the first page of this Mortgage.

FURTHER ASSURANCES; ATTORNEY-IN-FACT. The following provisions relating to
further assurances and attorney-in-fact are a part of this Mortgage:

FURTHER ASSURANCES. At any time, and from time to time, upon request of Lender,
Grantor will make, execute and deliver, or will cause to be made, executed or
delivered, to Lender or to Lender's designee, and when requested by Lender,
cause to be filed, recorded, refiled, or rerecorded, as the case may be, at such
times and in such offices and places as Lender may deem appropriate, any and all
such mortgages, deeds of trust, security deeds, security agreements, financing
statements, continuation statements, instruments of further assurance,
certificates, and other documents as may, in the sole opinion of Lender, be
necessary or desirable in order to effectuate, complete, perfect, continue, or
preserve (1) Grantor's obligations under the Note, this Mortgage, and the
Related Documents, and (2) the liens and security interests created by this
Mortgage as first and prior liens on the Property, whether now owned or
hereafter acquired by Grantor. Unless prohibited by law or Lender agrees to the
contrary in writing, Grantor shall reimburse Lender for all costs and expenses
incurred in connection with the matters referred to in this paragraph.

ATTORNEY-IN-FACT. If Grantor fails to do any of the things referred to in the
preceding paragraph, Lender may do so for and in the name of Grantor and at
Grantor's expense. For such purposes, Grantor hereby irrevocably appoints Lender
as Grantor's attorney-in-fact for the purpose of making, executing, delivering,
filing, recording, and doing all other things as may be necessary or desirable,
in Lender's sole opinion, to accomplish the matters referred to in the preceding
paragraph.

FULL PERFORMANCE. If Grantor pays all the Indebtedness, including without
limitation all future advances, when due, and otherwise performs all the
obligations imposed upon Grantor under this Mortgage, Lender shall execute and
deliver to Grantor a suitable satisfaction of this Mortgage and suitable
statements of termination of any financing statement on file evidencing Lender's
security interest in the Rents and the Personal Property. Grantor will pay, if
permitted by applicable law, any reasonable termination fee as determined by
Lender from time to time.

EVENTS OF DEFAULT. Each of the following, at Lender's option, shall constitute
an Event of Default under this Mortgage:

PAYMENT DEFAULT. Grantor fails to make any payment when due under the
Indebtedness.

DEFAULT ON OTHER PAYMENTS. Failure of Grantor within the time required by this
Mortgage to make any payment for taxes or insurance, or any other payment
necessary to prevent filing of or to effect discharge of any lien. Such failure
to make payment for taxes or insurance shall constitute waste at the time such
items are due and payable.

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                                    MORTGAGE
                                   (CONTINUED)

                                                                          PAGE 7

OTHER DEFAULTS. Grantor fails to comply with or to perform any other term,
obligation, covenant or condition contained in this Mortgage or in any of the
Related Documents or to comply with or to perform any term, obligation, covenant
or condition contained in any other agreement between Lender and Grantor.

FALSE STATEMENTS. Any warranty, representation or statement made or furnished to
Lender by Grantor or on Grantor's behalf under this Mortgage or the Related
Documents is false or misleading in any material respect, either now or at the
time made or furnished or becomes false or misleading at any time thereafter.

DEFECTIVE COLLATERALIZATION. This Mortgage or any of the Related Documents
ceases to be in full force and effect (including failure of any collateral
document to create a valid and perfected security interest or lien) at any time
and for any reason.

DEATH OR INSOLVENCY. The dissolution of Grantor's (regardless of whether
election to continue is made), any member withdraws from the limited liability
company, or any other termination of Grantor's existence as a going business of
the death of any member, the insolvency of Grantor, the appointment of a
receiver for any part of Grantor's property, any assignment for the benefit of
creditors, any type of creditor workout, or the commencement of any proceeding
under any bankruptcy or insolvency laws by or against Grantor.

CREDITOR OR FORFEITURE PROCEEDINGS. Commencement of foreclosure or forfeiture
proceedings, whether by judicial proceeding, self-help, repossession or any
other method, by any creditor of Grantor or by any governmental agency against
any property securing the Indebtedness. This includes a garnishment of any of
Grantor's accounts, including deposit accounts, with Lender. However, this Event
of Default shall not apply if there is a good faith dispute by Grantor as to the
validity or reasonableness of the claim which is the basis of the creditor or
forfeiture proceeding and if Grantor gives Lender written notice of the creditor
or forfeiture proceeding and deposits with Lender monies or a surety bond for
the creditor or forfeiture proceeding, in an amount determined by Lender, in its
sole discretion, as being an adequate reserve or bond for the dispute.

BREACH OF OTHER AGREEMENT. Any breach by Grantor under the terms of any other
agreement between Grantor and Lender that is not remedied within any grace
period provided therein, including without limitation any agreement concerning
any indebtedness or other obligation of Grantor to Lender, whether existing now
or later.

EVENTS AFFECTING GUARANTOR. Any of the preceding events occurs with respect to
any Guarantor of any of the Indebtedness or any Guarantor dies or becomes
incompetent, or revokes or disputes the validity of, or liability under, any
Guaranty of the Indebtedness.

ADVERSE CHANGE. A material adverse change occurs in Grantor's financial
condition, or Lender believes the prospect of payment or performance of the
Indebtedness is impaired.

INSECURITY. Lender in good faith believes itself insecure.

RIGHTS AND REMEDIES ON DEFAULT. Upon the occurrence of an Event of Default and
at any time thereafter, Lender, at Lender's option, may exercise any one or more
of the following rights and remedies, in addition to any other rights or
remedies provided by law:

ACCELERATE INDEBTEDNESS. Lender shall have the right at its option without
notice to Grantor to declare the entire Indebtedness immediately due and
payable, including any prepayment fee which Grantor would be required to pay.

UCC REMEDIES. With respect to all or any part of the Personal Property, Lender
shall have all the rights and remedies of a secured party under the Uniform
Commercial Code. Without limiting those rights and remedies, Lender may, at its
option, either (a) enforce its security interest in the Personal Property under
the Uniform Commercial Code or other applicable law or (b) include the Personal
Property in any judicial or non-judicial foreclosure of this Mortgage.

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                                    MORTGAGE
                                   (CONTINUED)

                                                                          PAGE 8

COLLECT RENTS. Lender shall have the right, without notice to Grantor, to take
possession of the Property and collect the Rents, including amounts past due and
unpaid, and apply the net proceeds, over and above Lender's costs, against the
Indebtedness. In furtherance of this right, Lender may require any tenant or
other user of the Property to make payments of rent or use fees directly to
Lender. If the Rents are collected by Lender, then Grantor irrevocably
designates Lender as Grantor's attorney-in-fact to endorse instruments received
in payment thereof in the name of Grantor and to negotiate the same and collect
the proceeds. Payments by tenants or other users to Lender in response to
Lender's demand shall satisfy the obligations for which the payments are made,
whether or not any proper grounds for the demand existed. Lender may exercise
its rights under this subparagraph either in person, by agent, or through a
receiver.

APPOINT RECEIVER. Any failure of Grantor to pay any taxes assessed against the
Property or to pay any installment of those taxes or to pay any insurance
premium upon any policy covering any property located upon the Property shall
constitute waste and shall entitle Lender to the appointment by a court of
competent jurisdiction of a receiver of the Property for the purpose of
preventing the waste, except that no receiver may be appointed for any dwelling
house or farm occupied by any owner of it as the owner's home or farm or for any
store or other business property having an assessed valuation of $7,500 or less.
Subject to the order of the court, the receiver may collect the rents and income
from the Property and shall exercise control over the Property to the extent
ordered by the court. A court may also appoint a receiver for the Property in
any other circumstances permitted by law. Lender shall have the right to have a
receiver appointed to take possession of all or any part of the Property, with
the power to protect and preserve the Property and apply the proceeds, over and
above the cost of the receivership, against the Indebtedness. The receiver may
serve without bond if permitted by law. Lender's right to the appointment of a
receiver shall exist whether or not the apparent value of the Property exceeds
the Indebtedness by a substantial amount. Employment by Lender shall not
disqualify a person from serving as a receiver.

JUDICIAL FORECLOSURE. Lender may obtain a judicial decree foreclosing Grantor's
interest in all or any part of the Property.

NONJUDICIAL SALE. Lender may sell, release and convey the Real Property at
public sale and sign and deliver to the purchasers at the sale good and
sufficient deeds of conveyance, paying any surplus funds, after payment in full
of the sums then due under this Mortgage and the expenses of the sale, including
attorney fees as provided by law, to Grantor, all in accordance with applicable
law.

WARNING. THIS MORTGAGE CONTAINS A POWER OF SALE, AND, UPON DEFAULT, MAY BE
FORECLOSED BY ADVERTISEMENT. IN FORECLOSURE BY ADVERTISEMENT, NO HEARING IS
INVOLVED AND THE ONLY NOTICE REQUIRED IS TO PUBLISH NOTICE IN A LOCAL NEWSPAPER
AND TO POST A COPY OF THE NOTICE ON THE PROPERTY.

WAIVER. If this Mortgage is foreclosed by advertisement, Grantor hereby
voluntarily and knowingly waives all rights under the Constitution and laws of
the State of Michigan and Constitution and laws of the United States to all
notice and a hearing in connection with the above-mentioned foreclosure by
advertisement, except as set forth in the Michigan statute providing for
foreclosure by advertisement.

DEFICIENCY JUDGMENT. If permitted by applicable law, Lender may obtain a
judgment for any deficiency remaining in the Indebtedness due to Lender after
application of all amounts received from the exercise of the rights provided in
this section.

TENANCY AT WILL. If Grantor remains in possession of the Property after Lender
or the purchaser at a foreclosure sale of the Property become lawfully entitled
to possession of the Property, the Grantor shall become a tenant at will of
Lender or the purchaser of the Property and shall, at the option of the person
lawfully entitled to possession, either (1) pay a reasonable rental for the use
of the Property or (2) vacate the Property immediately upon the demand of the
person lawfully entitled to possession.

OTHER REMEDIES. Lender shall have all other rights and remedies provided in this
Mortgage or the Note or available at law or in equity.

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                                    MORTGAGE
                                   (CONTINUED)

                                                                          PAGE 9

SALE OF THE PROPERTY. To the extent permitted by applicable law, Grantor hereby
waives any and all right to have the Property marshalled. In exercising its
rights and remedies, Lender shall be free to sell all or any part of the
Property together or separately, in one sale or by separate sales and Grantor
waives Grantor's rights under MCLA Section 600.3224 to have separate parcels
sold separately and to have no more parcels than necessary sold. Lender shall be
entitled to bid at any public sale on all or any portion of the Property.

NOTICE OF SALE. Lender shall give Grantor reasonable notice of the time and
place of any public sale of the Personal Property or of the time after which any
private sale or other intended disposition of the Personal Property is to be
made. Reasonable notice shall mean notice given at least ten (10) days before
the time of the sale or disposition. Any sale of the Personal Property may be
made in conjunction with any sale of the Real Property.

ELECTION OF REMEDIES. Election by Lender to pursue any remedy shall not exclude
pursuit of any other remedy, and an election to make expenditures or to take
action to perform an obligation of Grantor under this Mortgage, after Grantor's
failure to perform, shall not affect Lender's right to declare a default and
exercise its remedies. Nothing under this Mortgage or otherwise shall be
construed so as to limit or restrict the rights and remedies available to Lender
following an Event of Default, or in any way to limit or restrict the rights and
ability of Lender to proceed directly against Grantor and/or against any other
co-maker, guarantor, surety or endorser and/or to proceed against any other
collateral directly or indirectly securing the Indebtedness. After the date that
payment of the Indebtedness secured by this Mortgage has been accelerated by
Lender, acceptance by Lender of any amount(s) paid by or on behalf of Grantor
which is less than the full unpaid balance of the Indebtedness, including
without limitation all accrued interest, late charges and other amounts due
Lender under this Mortgage, shall not be deemed a waiver of default or
acceleration, but shall be credited toward the unpaid balance of the
Indebtedness, unless Lender shall specifically agree in writing to waive any
such default or acceleration or both.

ATTORNEYS' FEES; EXPENSES. If Lender institutes any suit or action to enforce
any of the terms of this Mortgage, Lender shall be entitled to recover its
reasonable attorneys' fees. Whether or not any court action is involved, and to
the extent not prohibited by law, all reasonable expenses Lender incurs that in
Lender's opinion are necessary at any time for the protection of its interest or
the enforcement of its rights shall become a part of the Indebtedness payable on
demand and shall bear interest at the Note rate from the date of the expenditure
until repaid. Expenses covered by this paragraph include, without limitation,
however subject to any limits under applicable law, Lender's reasonable
attorneys' fees and Lender's legal expenses whether or not there is a lawsuit,
including reasonable attorneys' fees and expenses for bankruptcy proceedings
(including efforts to modify or vacate any automatic stay or injunction),
appeals, and any anticipated post-judgment collection services, the cost of
searching records, obtaining title reports (including foreclosure reports),
surveyors' reports, and appraisal fees and title insurance, to the extent
permitted by applicable law. Grantor also will pay any court costs, in addition
to all other sums provided by law.

NOTICES. Any notice required to be given under this Mortgage, including without
limitation any notice of default and any notice of sale shall be given in
writing, and shall be effective when actually delivered, when actually received
by telefacsimile (unless otherwise required by law), when deposited with a
nationally recognized overnight courier, or, if mailed, when deposited in the
United States mail, as first class, certified or registered mail postage
prepaid, directed to the address shown near the beginning of this Mortgage. All
copies of notices of foreclosure from the holder of any lien which has priority
over this Mortgage shall be sent to Lender's address, as shown near the
beginning of this Mortgage. Any party may change its address for notices under
this Mortgage by giving formal written notice to the other parties, specifying
that the purpose of the notice is to change the party's address. For notice
purposes, Grantor agrees to keep Lender informed at all times of Grantor's
current address. Unless otherwise provided or required by law, if there is more
than one Grantor, any notice given by Lender to any Grantor is deemed to be
notice given to all Grantors.

An exhibit, titled "Exhibit to Construction Mortgage and Notice of
Commencement," is attached to this Mortgage and by this reference is made a part
of this Mortgage just as if all the provisions, terms and conditions of the
Exhibit had been fully set forth in this Mortgage.

<PAGE>

                                    MORTGAGE
                                   (CONTINUED)

                                                                         PAGE 10

MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Mortgage:

AMENDMENTS. This Mortgage, together with any Related Documents, constitutes the
entire understanding and agreement of the parties as to the matters set forth in
this Mortgage. No alteration of or amendment to this Mortgage shall be effective
unless given in writing and signed by the party or parties sought to be charge
or bound by the alteration or amendment.

ANNUAL REPORTS. If the Property is used for purposes other than Grantor's
residence, Grantor shall furnish to Lender, upon request, a certified statement
of net operating income received from the Property during Grantor's previous
fiscal year in such form and detail as Lender shall require. "Net operating
income" shall mean all cash receipts from the Property less all cash
expenditures made in connection with the operation of the Property.

CAPTION HEADINGS. Caption headings in this Mortgage are for convenience purposes
only and are not to be used to interpret or define the provisions of this
Mortgage.

GOVERNING LAW. THIS MORTGAGE WILL BE GOVERNED BY, CONSTRUED AND ENFORCED IN
ACCORDANCE WITH FEDERAL LAW AND THE LAWS OF THE STATE OF MICHIGAN. THIS MORTGAGE
HAS BEEN ACCEPTED BY LENDER IN THE STATE OF MICHIGAN.

NO WAIVER BY LENDER. Lender shall not be deemed to have waived any rights under
this Mortgage unless such waiver is given in writing and signed by Lender. No
delay or omission on the part of Lender in exercising any right shall operate as
a waiver of such right or any other right. A waiver by Lender of a provision of
this Mortgage shall not prejudice or constitute a waiver of Lender's right
otherwise to demand strict compliance with that provision or any other provision
of this Mortgage. No prior waiver by Lender, nor any course of dealing between
Lender and Grantor, shall constitute a waiver of any of Lender's rights or of
any of Grantor's obligations as to any future transactions. Whenever the consent
of Lender is required under this Mortgage, the granting of such consent by
Lender in any instance shall not constitute continuing consent to subsequent
instances where such consent is required and in all cases such consent may be
granted or withheld in the sole discretion of Lender.

SEVERABILITY. If a court of competent jurisdiction finds any provision of this
Mortgage to be illegal, invalid, or unenforceable as to any circumstance, that
finding shall not make the offending provision illegal, invalid, or
unenforceable as to any other circumstance. If feasible, the offending provision
shall be considered modified so that it becomes legal, valid and enforceable. If
the offending provision cannot be so modified, it shall be considered deleted
from this Mortgage. Unless otherwise required by law, the illegality,
invalidity, or unenforceability of any provision of this Mortgage shall not
affect the legality, validity or enforceability of any other provision of this
Mortgage.

MERGER. There shall be no merger of the interest or estate created by this
Mortgage with any other interest or estate in the Property at any time held by
or for the benefit of Lender in any capacity, without the written consent of
Lender.

SUCCESSORS AND ASSIGNS. Subject to any limitations stated in this Mortgage on
transfer of Grantor's interest, this Mortgage shall be binding upon and inure to
the benefit of the parties, their successors and assigns. If ownership of the
Property becomes vested in a person other than Grantor, Lender, without notice
to Grantor, may deal with Grantor's successors with reference to this Mortgage
and the Indebtedness by way of forbearance or extension without releasing
Grantor from the obligations of this Mortgage or liability under the
Indebtedness.

TIME IS OF THE ESSENCE. Time is of the essence in the performance of this
Mortgage.

USE OF PRONOUNS. Any term used to designate any of the parties in this Mortgage
shall be deemed to include the respective heirs, estate representatives,
successors, and assigns of the parties, and all pronouns and relative words used
in this Mortgage are intended to apply in the singular, plural, feminine or
neuter forms as the context may required, to appropriately refer to the parties
designated.

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                                    MORTGAGE
                                   (CONTINUED)

                                                                         PAGE 11

WAIVE JURY. ALL PARTIES TO THIS MORTGAGE HEREBY WAIVE THE RIGHT TO ANY JURY
TRIAL IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT BY ANY PARTY AGAINST
ANY OTHER PARTY.

WAIVER OF HOMESTEAD EXEMPTION. Grantor hereby releases and waives all rights and
benefits of the homestead exemption laws of the State of Michigan as to all
Indebtedness secured by this Mortgage.

DEFINITIONS. The following capitalized words and terms shall have the following
meanings when used in this Mortgage. Unless specifically stated to the contrary,
all references to dollar amounts shall mean amounts in lawful money of the
United States of America. Words and terms used in the singular shall include the
plural, and the plural shall include the singular, as the context may require.
Words and terms not otherwise defined in this Mortgage shall have the meanings
attributed to such terms in the Uniform Commercial Code:

BORROWER. The word "Borrower" means OCM Development, LLC and includes all
co-signers and co-makers signing the Note.

DEFAULT. The word "Default" means the Default set forth in this Mortgage in the
section titled "Default".

ENVIRONMENTAL LAWS. The words "Environmental Laws" mean any and all state,
federal and local statutes, regulations and ordinances relating to the
protection of human health or the environment, including without limitation the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
as amended, 42 U.S.C. Section 9601, et seq. ("CERCLA"), the Superfund Amendments
and Reauthorization Act of 1986, Pub. L. No. 99-499 ("SARA"), the Hazardous
Materials Transportation Act, 49 U.S.C. Section 1801, et seq., the Resource
Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., or other
applicable state or federal laws, rules, or regulations adopted pursuant
thereto.

EVENT OF DEFAULT. The words "Event of Default" mean any of the events of default
set forth in this Mortgage in the events of default section of this Mortgage.

GRANTOR. The word "Grantor" means OCM Development, LLC.

GUARANTOR. The word "Guarantor" means nay guarantor, surety, or accommodation
party of any or all of the Indebtedness.

GUARANTY. The word "Guaranty" means the guaranty from Guarantor to Lender,
including without limitation a guaranty of all or part of the Note.

HAZARDOUS SUBSTANCES. The words "Hazardous Substances" mean materials that,
because of their quantity, concentration or physical, chemical or infectious
characteristics, may cause or pose a present or potential hazard to human health
or the environment when improperly used, treated, stored, disposed of,
generated, manufactured, transported or otherwise handled. The words "Hazardous
Substances" are used in their very broadest sense and include without limitation
any and all hazardous or toxic substances, materials or waste as defined by or
listed under the Environmental Laws. The term "Hazardous Substances" also
includes, without limitation, petroleum and petroleum by-products or any
fraction thereof and asbestos.

IMPROVEMENTS. The word "Improvements" means all existing and future
improvements, buildings, structures, mobile homes affixed on the Real Property,
facilities, additions, replacements and other construction on the Real Property.

INDEBTEDNESS. The word "Indebtedness" means all principal, interest, and other
amounts, costs and expenses payable under the Note or Related Documents,
together with all renewals of, extensions of, modifications of, consolidations
of and substitutions for the Note or Related Documents and any amounts expended
or advanced by Lender to discharge Grantor's obligations or expenses incurred by
Lender to enforce Grantor's obligations under this Mortgage, together with
interest on such amounts as provided in this Mortgage.

LENDER. The word "Lender" means Independent Bank West Michigan, its successors
and assigns.

<PAGE>

                                    MORTGAGE
                                   (CONTINUED)

                                                                         PAGE 12

MORTGAGE. The word "Mortgage" means this Mortgage between Grantor and Lender.

NOTE. The word "Note" means the promissory note dated ___________________, in
the original principal amount of $____________ from Grantor to Lender, together
with all renewals of, extensions of, modifications of, refinancings of,
consolidations of, and substitutions for the promissory note or agreement. The
maturity date of this Mortgage is _________________. NOTICE TO GRANTOR: THE NOTE
CONTAINS A VARIABLE INTEREST RATE.

PERSONAL PROPERTY. The words "Personal Property" mean all equipment, fixtures,
and other articles of personal property now or hereafter owned by Grantor, and
now or hereafter attached or affixed to the Real Property; together with all
accessions, parts, and additions to, all replacements of, and all substitutions
for, any of such property; and together with all proceeds (including without
limitation all insurance proceeds and refunds of premiums) from any sale or
other disposition of the Property.

PROPERTY. The word "Property" means collectively the Real Property and the
Personal Property.

REAL PROPERTY. The words "Real Property" mean the real property, interests and
rights, as further described in this Mortgage.

RELATED DOCUMENTS. The words "Related Documents" mean all promissory notes,
credit agreements, loan agreements, environmental agreements, guaranties,
security agreements, mortgages, deeds of trust, security deeds, collateral
mortgages, and all other instruments, agreements and documents, whether now or
hereafter existing, executed in connection with the Indebtedness.

RENTS. The word "Rents" means all present and future rents, revenues, income,
issues, royalties, profits, and other benefits derived from the Property.

GRANTOR COVENANTS AND AGREES TO THE PROVISIONS OF THIS MORTGAGE.

GRANTOR:

OCM DEVELOPMENT, LLC

BY:
    ---------------------------------

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