Exhibit 99.3
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BEHRINGER HARVARD WESTERN PORTFOLIO LP, as trustor
(Borrower)
to
Fidelity National Title Insurance Company, as trustee
(Trustee)
for the benefit of
JPMORGAN CHASE BANK, N.A., as mortgagee
(Lender)
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DEED OF TRUST AND SECURITY AGREEMENT
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Dated: July ___, 2005
PREPARED BY AND UPON
RECORDATION RETURN TO:
▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
NOTE TO CLERK/RECORDER:
THIS INSTRUMENT IS ALSO A FIXTURE FINANCING STATEMENT.
THIS DOCUMENT SECURES A PROMISSORY NOTE WHICH CONTAINS PROVISIONS FOR
ADJUSTMENTS IN THE INTEREST RATE AND PAYMENT AMOUNTS AND/OR A BALLOON PAYMENT.
THIS INSTRUMENT CONSTITUTES A SECURITY AGREEMENT AS THAT TERM IF DEFINED IN THE
CALIFORNIA UNIFORM COMMERCIAL CODE. PORTIONS OF THE COLLATERAL ARE GOODS THAT
ABE OR ARE TO BECOME FIXTURES ON THE LAND DESCRIBED IN EXHIBIT A HERETO. THIS
INSTRUMENT IS INTENDED TO SERVE AS A FIXTURE FILING AND IS TO BE RECORDED IN THE
REAL ESTATE RECORDS OF EACH COUNTY IN WHICH SAID LAND OR ANY PORTION THEREOF IS
LOCATED AND INDEXED AS A FEE DEED OF TRUST AND A FIXTURE FILING. BORROWER IS THE
OWNER OF THE FEE INTEREST IN EXHIBIT A HERETO.
DEED OF TRUST AND SECURITY AGREEMENT
THIS DEED OF TRUST AND SECURITY AGREEMENT (this "DEED OF TRUST") is made
as of this ____ day of July, 2005, by BEHRINGER HARVARD WESTERN PORTFOLIO LP, a
Delaware limited partnership, having its principal place of business c/o
Behringer Harvard Funds, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
as grantor ("BORROWER") to FIDELITY NATIONAL TITLE INSURANCE COMPANY, a
California corporation, having an address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, as trustee ("TRUSTEE") for the benefit of
JPMORGAN CHASE BANK, N.A., a banking association chartered under the laws of the
United States of America, having its principal place of business at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as grantee ("LENDER").
W I T N E S S E T H:
WHEREAS, this Deed of Trust is given to secure a loan (the "LOAN") in
the principal sum of Seventy Million Seven Hundred Fifty Thousand and No/100
Dollars ($70,750,000) advanced pursuant to that certain Loan Agreement, dated as
of the date hereof, between Borrower and Lender (as the same may hereafter be
amended, restated, replaced, supplemented, renewed, extended or otherwise
modified from time to time, the "LOAN Agreement") and evidenced by that certain
Promissory Note, dated the date hereof, made by Borrower in favor of Lender (as
the same may hereafter be amended, restated, replaced, supplemented, renewed,
extended or otherwise modified from time to time, the "NOTE");
WHEREAS, Borrower desires to secure the payment of the Debt (as defined
in the Loan Agreement) and the performance of all of its obligations under the
Note, the Loan Agreement and the other Loan Documents (as herein defined); and
WHEREAS, this Deed of Trust is given pursuant to the Loan Agreement, and
payment, fulfillment, and performance by Borrower of its obligations thereunder
and under the other Loan Documents are secured hereby, and each and every term
and provision of the Loan Agreement, the Note, and that certain Assignment of
Leases and Rents of even date herewith made by Borrower in favor of Lender
delivered in connection with this Deed of Trust (as the same may be amended,
restated, replaced, supplemented, renewed, extended or otherwise modified from
time to time, the "ASSIGNMENT OF LEASES"), including the rights, remedies,
obligations, covenants, conditions, agreements, indemnities, representations and
warranties of the parties therein, are hereby incorporated by reference herein
as though set forth in full and shall be considered a part of this Deed of Trust
(the Loan Agreement, the Note, this Deed of Trust, the Assignment of Leases and
Rents and all other documents evidencing or securing the Debt (including all
additional mortgages, deeds to secure debt and assignments of leases and rents)
or pursuant to which any Person incurs, has incurred or assumes any obligation
to or for the benefit of Lender in connection therewith, are hereinafter
referred to collectively as the "LOAN DOCUMENTS").
NOW THEREFORE, in consideration of the making of the Loan by Lender and
the covenants, agreements, representations and warranties set forth in this Deed
of Trust:
ARTICLE I - GRANTS OF SECURITY
SECTION 1.1 PROPERTY MORTGAGED. Borrower does hereby irrevocably
mortgage, grant, bargain, sell, pledge, assign, warrant, transfer and convey to
Trustee for the benefit of Lender and its successors and assigns, all of
Borrower's right, title and interest in, to and under the following property,
rights, interests and estates now owned, or hereafter acquired by Borrower
(collectively, the "PROPERTY"):
(a) LAND. The real property described in EXHIBIT A attached hereto
and made a part hereof (the "LAND");
(b) ADDITIONAL LAND. All ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ and development
rights hereafter acquired by Borrower for use in connection with the Land and
the development of the Land and all additional lands and estates therein which
may, from time to time, by supplemental mortgage or otherwise be expressly made
subject to the lien of this Deed of Trust;
(c) IMPROVEMENTS. The buildings, structures, fixtures, additions,
enlargements, extensions, modifications, repairs, replacements and improvements
now or hereafter erected or located on the Land (collectively, the
"IMPROVEMENTS");
(d) EASEMENTS. All easements, rights-of-way or use, rights, strips
and gores of land, streets, ways, alleys, passages, sewer rights, water, water
courses, water rights and powers, air rights and development rights, and all
estates, rights, titles, interests, privileges, liberties, servitudes,
tenements, hereditaments and appurtenances of any nature whatsoever, in any way
now or hereafter belonging, relating or pertaining to the Land and the
Improvements and the reversions and remainders, and all land lying in the bed of
any street, road or avenue, opened or proposed, in front of or adjoining the
Land, to the center line thereof and all the estates, rights, titles, interests,
rights of dower, rights of curtesy, property, possession, claim and demand
whatsoever, both at law and in equity, of Borrower of, in and to the Land and
the Improvements and every part and parcel thereof, with the appurtenances
thereto;
(e) EQUIPMENT. All "equipment," as such term is defined in Article 9
of the Uniform Commercial Code (as hereinafter defined), now owned or hereafter
acquired by Borrower, which is used at or in connection with the Improvements or
the Land or is located thereon or therein (including, but not limited to, all
machinery, equipment, furnishings, and electronic data-processing and other
office equipment now owned or hereafter acquired by Borrower and used at the
Improvements or the Land and any and all additions, substitutions and
replacements of any of the foregoing), together with all attachments,
components, parts, equipment and accessories installed thereon or affixed
thereto (collectively, the "EQUIPMENT"). Notwithstanding the foregoing,
Equipment shall not include any property belonging to tenants under leases
except to the extent that Borrower shall have any right or interest therein;
(f) FIXTURES. All Equipment now owned, or the ownership of which is
hereafter acquired, by Borrower which is so related to the Land and Improvements
forming part of the Property that it is deemed fixtures or real property under
the law of the particular state in which the Land is located, including, without
limitation, all building or construction materials intended for construction,
reconstruction, alteration or repair of or installation on the Property,
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construction equipment, appliances, machinery, plant equipment, fittings,
apparatuses, fixtures and other items now or hereafter attached to, installed in
or used in connection with (temporarily or permanently) any of the Improvements
or the Land, including, but not limited to, engines, devices for the operation
of pumps, pipes, plumbing, call and sprinkler systems, fire extinguishing
apparatuses and equipment, heating, ventilating, incinerating, electrical, air
conditioning and air cooling equipment and systems, gas and electric machinery,
appurtenances and equipment, pollution control equipment, security systems,
disposals, dishwashers, refrigerators and ranges, recreational equipment and
facilities of all kinds, and water, gas, electrical, storm and sanitary sewer
facilities, utility lines and equipment (whether owned individually or jointly
with others, and, if owned jointly, to the extent of Borrower's interest
therein) and all other utilities whether or not situated in easements, all water
tanks, water supply, water power sites, fuel stations, fuel tanks, fuel supply,
and all other structures, together with all accessions, appurtenances,
additions, replacements, betterments and substitutions for any of the foregoing
and the proceeds thereof (collectively, the "FIXTURES"). Notwithstanding the
foregoing, "Fixtures" shall not include any property which tenants are entitled
to remove pursuant to leases except to the extent that Borrower shall have any
right or interest therein;
(g) PERSONAL PROPERTY. All furniture, furnishings, objects of art,
machinery, goods, tools, supplies, appliances, general intangibles, contract
rights, accounts, accounts receivable, franchises, licenses, certificates and
permits, and all other personal property of any kind or character whatsoever as
defined in and subject to the provisions of the Uniform Commercial Code, whether
tangible or intangible, other than Fixtures, which are now or hereafter owned by
Borrower and which are located within or about the Land and the Improvements,
together with all accessories, replacements and substitutions thereto or
therefor and the proceeds thereof (collectively, the "PERSONAL PROPERTY"), and
the right, title and interest of Borrower in and to any of the Personal Property
which may be subject to any security interests, as defined in the Uniform
Commercial Code, as adopted and enacted by the state or states where any of the
Property is located (the "UNIFORM COMMERCIAL CODE"), superior in lien to the
lien of this Deed of Trust and all proceeds and products of the above;
(h) LEASES AND RENTS. All leases, subleases or subsubleases,
lettings, licenses, concessions or other agreements (whether written or oral)
pursuant to which any Person is granted a possessory interest in, or right to
use or occupy all or any portion of the Land and the Improvements, and every
modification, amendment or other agreement relating to such leases, subleases,
subsubleases, or other agreements entered into in connection with such leases,
subleases, subsubleases, or other agreements and every guarantee of the
performance and observance of the covenants, conditions and agreements to be
performed and observed by the other party thereto, heretofore or hereafter
entered into (collectively, the "LEASES"), whether before or after the filing by
or against Borrower of any petition for relief under the Bankruptcy Code and all
right, title and interest of Borrower, its successors and assigns therein and
thereunder, including, without limitation, cash or securities deposited
thereunder to secure the performance by the lessees of their obligations
thereunder and all rents, additional rents, revenues, issues and profits
(including all oil and gas or other mineral royalties and bonuses) from the Land
and the Improvements whether paid or accruing before or after the filing by or
against Borrower of any petition for relief under the Bankruptcy Code
(collectively, the "RENTS") and all proceeds from the sale or other disposition
of the Leases and the right to receive and apply the Rents to the payment of the
Debt;
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(i) CONDEMNATION AWARDS. All Awards, including interest thereon,
which may heretofore and hereafter be made with respect to the Property, whether
from the exercise of the right of eminent domain (including, but not limited to,
any transfer made in lieu of or in anticipation of the exercise of the right),
or for a change of grade, or for any other injury to or decrease in the value of
the Property;
(j) INSURANCE PROCEEDS. All Insurance Proceeds in respect of the
Property under any Policies covering the Property, including, without
limitation, the right to receive and apply the proceeds of any Policies,
judgments, or settlements made in lieu thereof, in connection with a Casualty to
the Property;
(k) TAX CERTIORARI. All refunds, rebates or credits in connection
with reduction in Taxes or Other Charges charged against the Property as a
result of tax certiorari or any applications or proceedings for reduction;
(l) CONVERSION. All proceeds of the conversion, voluntary or
involuntary, of any of the foregoing including, without limitation, Insurance
Proceeds and Awards, into cash or liquidation claims;
(m) RIGHTS. The right, in the name and on behalf of Borrower, to
appear in and defend any action or proceeding brought with respect to the
Property and to commence any action or proceeding to protect the interest of
Lender in the Property;
(n) AGREEMENTS. All agreements, contracts, certificates,
instruments, franchises, permits, licenses, plans, specifications and other
documents, now or hereafter entered into, and all rights therein and thereto,
respecting or pertaining to the use, occupation, construction, management or
operation of the Land and any part thereof and any Improvements or any business
or activity conducted on the Land and any part thereof and all right, title and
interest of Borrower therein and thereunder, including, without limitation, the
right, upon the happening of any default hereunder, to receive and collect any
sums payable to Borrower thereunder;
(o) TRADEMARKS. All tradenames, trademarks, servicemarks, logos,
copyrights, goodwill, books and records and all other general intangibles
relating to or used in connection with the operation of the Property;
(p) ACCOUNTS. All reserves, escrows and deposit accounts maintained
by Borrower with respect to the Property, including, without limitation (i) all
accounts established pursuant to the Cash Management Agreement and (ii) all
accounts established pursuant to the Lockbox Agreement; together with all
deposits or wire transfers made to the Lockbox Account or Cash Management
Account and all cash, checks, drafts, certificates, securities, investment
property, financial assets, instruments and other property held therein from
time to time and all proceeds, products, distributions or dividends or
substitutions thereon and thereof;
(q) OTHER RIGHTS. Any and all other rights of Borrower in and to the
items set forth in SUBSECTIONS (A) through (P) above.
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AND without limiting any of the other provisions of this Deed of Trust,
to the extent permitted by applicable law, Borrower expressly grants to Lender,
as secured party, a security interest in the portion of the Property which is or
may be subject to the provisions of the Uniform Commercial Code which are
applicable to secured transactions; it being understood and agreed that the
Improvements and Fixtures are part and parcel of the Land (the Land, the
Improvements and the Fixtures collectively referred to as the "REAL PROPERTY")
appropriated to the use thereof and, whether affixed or annexed to the Real
Property or not, shall for the purposes of this Deed of Trust be deemed
conclusively to be real estate and subject to this Deed of Trust.
SECTION 1.2 ASSIGNMENT OF RENTS. Borrower hereby absolutely and
unconditionally assigns to Lender all of Borrower's right, title and interest in
and to all current and future Leases and Rents; it being intended by Borrower
that this assignment constitutes a present, absolute assignment and not an
assignment for additional security only. Nevertheless, subject to the terms of
the Assignment of Leases, the Cash Management Agreement and SECTION 7.1(H) of
this Deed of Trust, Lender grants to Borrower a revocable license to collect,
receive, use and enjoy the Rents and Borrower shall hold the Rents, or a portion
thereof sufficient to discharge all current sums due on the Debt, for use in the
payment of such sums.
SECTION 1.3 SECURITY AGREEMENT. This Deed of Trust is both a real
property mortgage and a "security agreement" within the meaning of the Uniform
Commercial Code. The Property includes both real and personal property and all
other rights and interests, whether tangible or intangible in nature, of
Borrower in the Property. By executing and delivering this Deed of Trust,
Borrower hereby grants to Lender, as security for the Obligations (hereinafter
defined), a security interest in the Fixtures, the Equipment and the Personal
Property to the full extent that the Fixtures, the Equipment and the Personal
Property may be subject to the Uniform Commercial Code (said portion of the
Property so subject to the Uniform Commercial Code being called the
"COLLATERAL"). If an Event of Default shall occur and be continuing, Lender, in
addition to any other rights and remedies which it may have, shall have and may
exercise immediately and without demand, any and all rights and remedies granted
to a secured party upon default under the Uniform Commercial Code, including,
without limiting the generality of the foregoing, the right to take possession
of the Collateral or any part thereof, and to take such other measures as Lender
may deem necessary for the care, protection and preservation of the Collateral.
Upon request or demand of Lender after the occurrence and during the continuance
of an Event of Default, Borrower shall, at its expense, assemble the Collateral
and make it available to Lender at a convenient place (at the Land if tangible
property) reasonably acceptable to Lender. Borrower shall pay to Lender on
demand any and all expenses, including reasonable legal expenses and attorneys'
fees, incurred or paid by Lender in protecting its interest in the Collateral
and in enforcing its rights hereunder with respect to the Collateral after the
occurrence and during the continuance of an Event of Default. Any notice of
sale, disposition or other intended action by Lender with respect to the
Collateral sent to Borrower in accordance with the provisions hereof at least
ten (10) Business Days prior to such action, shall, except as otherwise provided
by applicable law, constitute reasonable notice to Borrower. The proceeds of any
disposition of the Collateral, or any part thereof, may, except as otherwise
required by applicable law, be applied by Lender to the payment of the Debt in
such priority and proportions as Lender in its discretion shall deem proper.
Borrower's (debtor's) principal place of business is as set
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forth on page one hereof and the address of Lender (secured party) is as set
forth on page one hereof. Borrower's organizational ID no. is _________.
SECTION 1.4 FIXTURE FILING. Certain of the Property is or will become
"fixtures" (as that term is defined in the Uniform Commercial Code) on the Land,
and this Deed of Trust, upon being filed for record in the real estate records
of the city or county wherein such fixtures are situated, shall operate also as
a financing statement filed as a fixture filing in accordance with the
applicable provisions of said Uniform Commercial Code upon such of the Property
that is or may become fixtures.
SECTION 1.5 PLEDGES OF MONIES HELD. Borrower hereby pledges to Lender
any and all monies now or hereafter held by Lender or on behalf of Lender,
including, without limitation, any sums deposited in the Lockbox Account, the
Cash Management Account, the Reserve Funds and Net Proceeds, as additional
security for the Obligations until expended or applied as provided in this Deed
of Trust.
CONDITIONS TO GRANT
TO HAVE AND TO HOLD the above granted and described Property unto
Trustee for and on behalf of Lender and to the use and benefit of Lender and
Trustee for their successors and assigns, forever;
IN TRUST, WITH POWER OF SALE, to secure payment to Lender of the Debt at
the time and in the manner provided for its payment in the Loan Agreement, the
Note and in this Deed of Trust.
PROVIDED, HOWEVER, these presents are upon the express condition that,
if Borrower shall well and truly pay to Lender the Debt at the time and in the
manner provided in the Note, the Loan Agreement and this Deed of Trust, shall
well and truly perform the Other Obligations as set forth in this Deed of Trust
and shall well and truly abide by and comply with each and every covenant and
condition set forth herein and in the Note, the Loan Agreement and the other
Loan Documents, these presents and the estate hereby granted shall cease,
terminate and be void; provided, however, that Borrower's obligation to
indemnify and hold harmless Lender pursuant to the provisions hereof shall
survive any such payment or release.
ARTICLE II - DEBT AND OBLIGATIONS SECURED
SECTION 2.1 DEBT. This Deed of Trust and the grants, assignments and
transfers made in Article I are given ---- for the purpose of securing the Debt.
SECTION 2.2 OTHER OBLIGATIONS. This Deed of Trust and the grants,
assignments and transfers made in Article I are also given for the purpose of
securing the following (the "OTHER OBLIGATIONS"):
(a) the performance of all other obligations of Borrower contained
herein;
(b) the performance of each obligation of Borrower contained in the
Loan Agreement and any other Loan Document; and
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(c) the performance of each obligation of Borrower contained in any
renewal, extension, amendment, modification, consolidation, change of, or
substitution or replacement for, all or any part of the Note, the Loan Agreement
or any other Loan Document.
SECTION 2.3 DEBT AND OTHER OBLIGATIONS. Borrower's obligations for the
payment of the Debt and the performance of the Other Obligations shall be
referred to collectively herein as the "OBLIGATIONS."
ARTICLE III - BORROWER COVENANTS
Borrower covenants and agrees that:
SECTION 3.1 PAYMENT OF DEBT. Borrower will pay the Debt at the time and
in the manner provided in the Loan Agreement, the Note and this Deed of Trust.
SECTION 3.2 INCORPORATION BY REFERENCE. All the covenants, conditions
and agreements contained in (a) the Loan Agreement, (b) the Note and (c) all and
any of the other Loan Documents, are hereby made a part of this Deed of Trust to
the same extent and with the same force as if fully set forth herein.
SECTION 3.3 INSURANCE. Borrower shall obtain and maintain, or cause to
be maintained, in full force and effect at all times insurance with respect to
Borrower and the Property as required pursuant to the Loan Agreement.
SECTION 3.4 MAINTENANCE OF PROPERTY. Borrower shall cause the Property
to be maintained in a good and safe condition and repair. The Improvements, the
Fixtures, the Equipment and the Personal Property shall not be removed,
demolished or materially altered (except for normal replacement of the Fixtures,
the Equipment or the Personal Property, tenant finish and refurbishment of the
Improvements and for the disposal of Fixtures, Equipment or Personal Property
not material to the use or value of the Property as an office building) without
the consent of Lender. Borrower shall promptly repair, replace or rebuild any
part of the Property which may be destroyed by any Casualty or become damaged,
worn or dilapidated or which may be affected by any Condemnation, and shall
complete and pay for any structure at any time in the process of construction or
repair on the Land.
SECTION 3.5 WASTE. Borrower shall not commit or suffer any waste of the
Property or make any change in the use of the Property which will in any way
materially increase the risk of fire or other hazard arising out of the
operation of the Property, or take any action that might invalidate or allow the
cancellation of any Policy, or do or permit to be done thereon anything that may
in any way materially impair the value of the Property or the security of this
Deed of Trust. Borrower will not, without the prior written consent of Lender,
permit any drilling or exploration for or extraction, removal, or production of
any minerals from the surface or the subsurface of the Land, regardless of the
depth thereof or the method of mining or extraction thereof.
SECTION 3.6 PAYMENT FOR LABOR AND MATERIALS. (a) Subject to Section
3.6(b), Borrower will promptly pay when due all bills and costs for labor,
materials, and specifically fabricated materials ("LABOR AND MATERIAL COSTS")
incurred in connection with the Property and
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never permit to exist beyond the due date thereof in respect of the Property or
any part thereof any lien or security interest, even though inferior to the
liens and the security interests hereof, and in any event never permit to be
created or exist in respect of the Property or any part thereof any other or
additional lien or security interest other than the liens or security interests
hereof except for the Permitted Encumbrances and other Liens permitted pursuant
to the Loan Documents.
(b) After prior written notice to Lender, Borrower, at its own
expense, may contest by appropriate legal proceeding, promptly initiated and
conducted in good faith and with due diligence, the amount or validity or
application in whole or in part of any of the Labor and Material Costs, provided
that (i) no Event of Default has occurred and is continuing under the Loan
Agreement, the Note, this Deed of Trust or any of the other Loan Documents, (ii)
Borrower is permitted to do so under the provisions of any other mortgage, deed
of trust or deed to secure debt affecting the Property, (iii) such proceeding
shall suspend the collection of the Labor and Material Costs from Borrower and
from the Property or Borrower shall have paid all of the Labor and Material
Costs (or such portion thereof as to which collection is not suspended) under
protest, (iv) such proceeding shall be permitted under and be conducted in
accordance with the provisions of any other instrument to which Borrower is
subject and shall not constitute a default thereunder, (v) neither the Property
nor any part thereof or interest therein will be in immediate danger of being
sold, forfeited, terminated, canceled or lost, and (vi) Borrower shall have
furnished the security as may be required in the proceeding, or as may be
reasonably requested by Lender to insure the payment of any contested Labor and
Material Costs, together with all interest and penalties thereon.
SECTION 3.7 PERFORMANCE OF OTHER AGREEMENTS. Borrower shall observe and
perform each and every term, covenant and provision to be observed or performed
by Borrower pursuant to the Loan Agreement, any other Loan Document and any
other agreement or recorded instrument affecting or pertaining to the Property
and any amendments, modifications or changes thereto.
SECTION 3.8 CHANGE OF NAME, IDENTITY OR STRUCTURE. Borrower shall not
change Borrower's name, identity (including its trade name or names) or, if not
an individual, Borrower's corporate, partnership or other structure without
notifying Lender of such change in writing at least thirty (30) days prior to
the effective date of such change and, in the case of a change in Borrower's
structure, without first obtaining the prior written consent of Lender. Borrower
shall execute and deliver to Lender, prior to or contemporaneously with the
effective date of any such change, any financing statement or financing
statement change required by Lender to establish or maintain the validity,
perfection and priority of the security interest granted herein. At the request
of Lender, Borrower shall execute a certificate in form satisfactory to Lender
listing the trade names under which Borrower intends to operate the Property,
and representing and warranting that Borrower does business under no other trade
name with respect to the Property.
SECTION 3.9 TITLE. Borrower has good, marketable and insurable fee
simple title to the real property comprising part of the Property and good title
to the balance of such Property, free and clear of all Liens (as defined in the
Loan Agreement) whatsoever except the Permitted Encumbrances (as defined in the
Loan Agreement), such other Liens as are permitted
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pursuant to the Loan Documents and the Liens created by the Loan Documents. The
Permitted Encumbrances in the aggregate do not materially and adversely affect
the value, operation or use of the Property or Borrower's ability to repay the
Loan. This Deed of Trust, when properly recorded in the appropriate records,
together with any Uniform Commercial Code financing statements required to be
filed in connection therewith, will create (a) a valid, perfected first priority
lien on that portion of the Property constituting interests in real estate,
subject only to Permitted Encumbrances and the Liens created by the Loan
Documents and (b) to the extent that a security interest therein maybe perfected
by the filing of financing statements under the Uniform Commercial Code,
perfected security interests in and to, and perfected collateral assignments of,
all personalty (including, to the extent that they constitute personalty subject
to the Uniform Commercial Code, the Leases), all in accordance with the terms
thereof, in each case subject only to any applicable Permitted Encumbrances,
such other Liens as are permitted pursuant to the Loan Documents and the Liens
created by the Loan Documents. There are no claims for payment for work, labor
or materials affecting the Property which are past due and are or may become a
lien prior to, or of equal priority with, the Liens created by the Loan
Documents unless such claims for payments are being contested in accordance with
the terms and conditions of this Deed of Trust.
ARTICLE IV - OBLIGATIONS AND RELIANCES
SECTION 4.1 RELATIONSHIP OF BORROWER AND LENDER. The relationship
between Borrower and Lender is solely that of debtor and creditor, and Lender
has no fiduciary or other special relationship with Borrower, and no term or
condition of the Loan Agreement, the Note, this Deed of Trust and the other Loan
Documents shall be construed so as to deem the relationship between Borrower and
Lender to be other than that of debtor and creditor.
SECTION 4.2 NO RELIANCE ON LENDER. The general partners, members,
principals and (if Borrower is a trust) beneficial owners of Borrower are
experienced in the ownership and operation of properties similar to the
Property, and Borrower and Lender are relying solely upon such expertise and
business plan in connection with the ownership and operation of the Property.
Borrower is not relying on Lender's expertise, business acumen or advice in
connection with the Property.
SECTION 4.3 NO LENDER OBLIGATIONS. (a) Notwithstanding the provisions of
SUBSECTIONS 1.1(H) and (N) or SECTION 1.2, Lender is not undertaking the
performance of (i) any obligations under the Leases; or (ii) any obligations
with respect to such agreements, contracts, certificates, instruments,
franchises, permits, trademarks, licenses and other documents.
(b) By accepting or approving anything required to be observed,
performed or fulfilled or to be given to Lender pursuant to this Deed of Trust,
the Loan Agreement, the Note or the other Loan Documents, including, without
limitation, any Officer's Certificate, balance sheet, statement of profit and
loss or other financial statement, survey, appraisal, or Policy, Lender shall
not be deemed to have warranted, consented to, or affirmed the sufficiency, the
legality or effectiveness of same, and such acceptance or approval thereof shall
not constitute any warranty or affirmation with respect thereto by Lender.
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SECTION 4.4 RELIANCE. Borrower recognizes and acknowledges that in
accepting the Loan Agreement, the Note, this Deed of Trust and the other Loan
Documents, Lender is expressly and primarily relying on the truth and accuracy
of the warranties and representations set forth in Section 4.1 of the Loan
Agreement without any obligation to investigate the Property and notwithstanding
any investigation of the Property by Lender; that such reliance existed on the
part of Lender prior to the date hereof, that the warranties and representations
are a material inducement to Lender in making the Loan; and that Lender would
not be willing to make the Loan and accept this Deed of Trust in the absence of
the warranties and representations as set forth in Section 4.1 of the Loan
Agreement.
ARTICLE V - FURTHER ASSURANCES
SECTION 5.1 RECORDING OF DEED OF TRUST, ETC. Borrower forthwith upon the
execution and delivery of this Deed of Trust and thereafter, from time to time
upon Lender's request, will cause this Deed of Trust and any of the other Loan
Documents creating a lien or security interest or evidencing the lien hereof
upon the Property and each instrument of further assurance to be filed,
registered or recorded in such manner and in such places as may be required by
any present or future law in order to publish notice of and fully to protect and
perfect the lien or security interest hereof upon, and the interest of Lender
in, the Property. Borrower will pay all taxes, filing, registration or recording
fees, and all expenses incident to the preparation, execution, acknowledgment
and/or recording of the Note, this Deed of Trust, the other Loan Documents, any
note, deed of trust or mortgage supplemental hereto, any security instrument
with respect to the Property and any instrument of further assurance, and any
modification or amendment of the foregoing documents, and all federal, state,
county and municipal taxes, duties, imposts, assessments and charges arising out
of or in connection with the execution and delivery of this Deed of Trust, any
deed of trust or mortgage supplemental hereto, any security instrument with
respect to the Property or any instrument of further assurance, and any
modification or amendment of the foregoing documents, except where prohibited by
law so to do.
SECTION 5.2 FURTHER ACTS, ETC. Borrower will, at the cost of Borrower,
and without expense to Lender, do, execute, acknowledge and deliver all and
every further acts, deeds, conveyances, deeds of trust, mortgages, assignments,
notices of assignments, transfers and assurances as Lender shall, from time to
time, reasonably require, for the better assuring, conveying, assigning,
transferring, and confirming unto Lender the property and rights hereby
mortgaged, deeded, granted, bargained, sold, conveyed, confirmed, pledged,
assigned, warranted and transferred or intended now or hereafter so to be, or
which Borrower may be or may hereafter become bound to convey or assign to
Lender, or for carrying out the intention or facilitating the performance of the
terms of this Deed of Trust or for filing, registering or recording this Deed of
Trust, or for complying with all Legal Requirements. Borrower, on demand, will
execute and deliver, and in the event it shall fail to so execute and deliver,
hereby authorizes Lender to execute in the name of Borrower or without the
signature of Borrower to the extent Lender may lawfully do so, one or more
financing statements to evidence more effectively the security interest of
Lender in the Property. Borrower grants to Lender an irrevocable power of
attorney coupled with an interest for the purpose of exercising and perfecting
any and all rights and remedies available to Lender at law and in equity,
including without limitation, such rights and remedies available to Lender
pursuant to this SECTION 5.2.
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SECTION 5.3 CHANGES IN TAX, DEBT, CREDIT AND DOCUMENTARY STAMP LAWS. (a)
If any law is enacted or adopted or amended after the date of this Deed of Trust
which deducts the Debt from the value of the Property for the purpose of
taxation or which imposes a tax, either directly or indirectly, on the Debt or
Lender's interest in the Property (other than the inclusion of such amounts as
income for income tax purposes or taxes on Lender's capital), Borrower will pay
the tax, with interest and penalties thereon, if any. If Lender is advised by
counsel chosen by it that the payment of tax by Borrower would be unlawful or
taxable to Lender or unenforceable or provide the basis for a defense of usury,
then Lender shall have the option by written notice of not less than one hundred
twenty (120) days to declare the Debt immediately due and payable. If so
accelerated, Borrower shall repay the Loan without premium or penalty.
(b) Borrower will not claim or demand or be entitled to any credit
or credits on account of the Debt for any part of the Taxes or Other Charges
assessed against the Property, or any part thereof, and no deduction shall
otherwise be made or claimed from the assessed value of the Property, or any
part thereof, for real estate tax purposes by reason of this Deed of Trust or
the Debt. If such claim, credit or deduction shall be required by law, Lender
shall have the option, by written notice of not less than one hundred twenty
(120) days, to declare the Debt immediately due and payable. If so accelerated,
Borrower shall repay the Loan without premium or penalty.
(c) If at any time the United States of America, any State thereof
or any subdivision of any such State shall require revenue or other stamps to be
affixed to the Note, this Deed of Trust, or any of the other Loan Documents or
impose any other tax or charge on the same, Borrower will pay for the same, with
interest and penalties thereon, if any.
SECTION 5.4 SEVERING OF DEED OF TRUST. This Deed of Trust and the Note
shall, at any time until the same shall be fully paid and satisfied, at the sole
election of Lender, be severed into two or more notes and two or more security
instruments in such denominations as Lender shall determine in its sole
discretion, each of which shall cover all or a portion of the Property to be
more particularly described therein. To that end, Borrower, upon written request
of Lender, shall execute, acknowledge and deliver, or cause to be executed,
acknowledged and delivered by the then owner of the Property, to Lender and/or
its designee or designees substitute notes and security instruments in such
principal amounts, aggregating not more than the then unpaid principal amount of
this Deed of Trust, and containing terms, provisions and clauses similar to, and
no more onerous to Borrower than, those contained herein and in the Note, and
such other documents and instruments as may be required by Lender; provided that
Borrower's obligations are not materially increased thereby.
SECTION 5.5 REPLACEMENT DOCUMENTS. Upon receipt of an affidavit of an
officer of Lender as to the loss, theft, destruction or mutilation of the Note
or any other Loan Document which is not of public record, and, in the case of
any such mutilation, upon surrender and cancellation of such Note or other Loan
Document, Borrower will issue, in lieu thereof, a replacement Note or other Loan
Document, dated the date of such lost, stolen, destroyed or mutilated Note or
other Loan Document in the same principal amount thereof and otherwise of like
tenor.
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ARTICLE VI - DUE ON SALE/ENCUMBRANCE
SECTION 6.1 LENDER RELIANCE. Borrower acknowledges that Lender has
examined and relied on the experience of Borrower and its general partners,
members, principals and (if Borrower is a trust) beneficial owners in owning and
operating properties such as the Property in agreeing to make the Loan, and will
continue to rely on Borrower's ownership of the Property as a means of
maintaining the value of the Property as security for repayment of the Debt and
the performance of the Other Obligations. Borrower acknowledges that Lender has
a valid interest in maintaining the value of the Property so as to ensure that,
should Borrower default in the repayment of the Debt or the performance of the
Other Obligations, Lender can recover the Debt by a sale of the Property.
SECTION 6.2 NO SALE/ENCUMBRANCE. Neither Borrower nor any Restricted
Party shall Transfer the Property or any part thereof or any interest therein or
permit or suffer the Property or any part thereof or any interest therein to be
Transferred other than as expressly permitted pursuant to the terms of the Loan
Agreement.
ARTICLE VII - RIGHTS AND REMEDIES UPON DEFAULT
SECTION 7.1 REMEDIES. Upon the occurrence and during the continuance of
any Event of Default, Borrower agrees that Lender may take such action, without
notice or demand, as it deems advisable to protect and enforce its rights
against Borrower and in and to the Property, including, but not limited to, the
following actions, each of which may be pursued concurrently or otherwise, at
such time and in such order as Lender may determine, in its sole discretion,
without impairing or otherwise affecting the other rights and remedies of
Lender:
(a) declare the entire unpaid Debt to be immediately due and
payable;
(b) institute proceedings, judicial or otherwise, for the complete
foreclosure of this Deed of Trust under any applicable provision of law, in
which case the Property or any interest therein may be sold for cash or upon
credit in one or more parcels or in several interests or portions and in any
order or manner;
(c) with or without entry, to the extent permitted and pursuant to
the procedures provided by applicable law, institute proceedings for the partial
foreclosure of this Deed of Trust for the portion of the Debt then due and
payable, subject to the continuing lien and security interest of this Deed of
Trust for the balance of the Debt not then due, unimpaired and without loss of
priority;
(d) sell for cash or upon credit the Property or any part thereof
and all estate, claim, demand, right, title and interest of Borrower therein and
rights of redemption thereof, pursuant to power of sale or otherwise, at one or
more sales, as an entirety or in parcels, at such time and place, upon such
terms and after such notice thereof as may be required or permitted by law;
(e) institute an action, suit or proceeding in equity for the
specific performance of any covenant, condition or agreement contained herein,
in the Note, the Loan Agreement or in the other Loan Documents;
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(f) recover judgment on the Note either before, during or after any
proceedings for the enforcement of this Deed of Trust or the other Loan
Documents;
(g) apply for the appointment of a receiver, trustee, liquidator or
conservator of the Property, without notice and without regard for the adequacy
of the security for the Debt and without regard for the solvency of Borrower,
any Guarantor or Indemnifying Person with respect to the Loan or of any Person
liable for the payment of the Debt;
(h) the license granted to Borrower under SECTION 1.2 hereof shall
automatically be revoked and Lender may enter into or upon the Property, either
personally or by its agents, nominees or attorneys and dispossess Borrower and
its agents and servants therefrom, without liability for trespass, damages or
otherwise and exclude Borrower and its agents or servants wholly therefrom, and
take possession of all books, records and accounts relating thereto and Borrower
agrees to surrender possession of the Property and of such books, records and
accounts to Lender upon demand, and thereupon Lender may (i) use, operate,
manage, control, insure, maintain, repair, restore and otherwise deal with all
and every part of the Property and conduct the business thereat; (ii) complete
any construction on the Property in such manner and form as Lender deems
advisable; (iii) make alterations, additions, renewals, replacements and
improvements to or on the Property; (iv) exercise all rights and powers of
Borrower with respect to the Property, whether in the name of Borrower or
otherwise, including, without limitation, the right to make, cancel, enforce or
modify Leases, obtain and evict tenants, and demand, ▇▇▇ for, collect and
receive all Rents of the Property and every part thereof; (v) require Borrower
to pay monthly in advance to Lender, or any receiver appointed to collect the
Rents, the fair and reasonable rental value for the use and occupation of such
part of the Property as may be occupied by Borrower; (vi) require Borrower to
vacate and surrender possession of the Property to Lender or to such receiver
and, in default thereof, Borrower may be evicted by summary proceedings or
otherwise; and (vii) apply the receipts from the Property to the payment of the
Debt, in such order, priority and proportions as Lender shall deem appropriate
in its sole discretion after deducting therefrom all expenses (including
reasonable attorneys' fees) incurred in connection with the aforesaid operations
and all amounts necessary to pay the Taxes, Other Charges, Insurance Premium and
other expenses in connection with the Property, as well as just and reasonable
compensation for the services of Lender, its counsel, agents and employees;
(i) exercise any and all rights and remedies granted to a secured
party upon default under the Uniform Commercial Code, including, without
limiting the generality of the foregoing: (i) the right to take possession of
the Fixtures, the Equipment, the Personal Property or any part thereof, and to
take such other measures as Lender may deem necessary for the care, protection
and preservation of the Fixtures, the Equipment, the Personal Property, and (ii)
request Borrower at its expense to assemble the Fixtures, the Equipment, the
Personal Property and make it available to Lender at a convenient place
acceptable to Lender. Any notice of sale, disposition or other intended action
by Lender with respect to the Fixtures, the Equipment, the Personal Property
sent to Borrower in accordance with the provisions hereof at least ten (10) days
prior to such action, shall constitute commercially reasonable notice to
Borrower;
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(j) apply any sums then deposited or held in escrow or otherwise by
or on behalf of Lender in accordance with the terms of the Loan Agreement, this
Deed of Trust or any other Loan Document to the payment of the following items
in any order in its uncontrolled discretion:
(i) Taxes and Other Charges;
(ii) Insurance Premiums;
(iii) Interest on the unpaid principal balance of the Note;
(iv) Amortization of the unpaid principal balance of the
Note;
(v) All other sums payable pursuant to the Note, the Loan
Agreement, this Deed of Trust and the other Loan Documents, including
without limitation advances made by Lender pursuant to the terms of this
Deed of Trust;
(k) pursue such other remedies as Lender may have under applicable
law; or
(l) apply the undisbursed balance of any Net Proceeds Deficiency
deposit, together with interest thereon, to the payment of the Debt in such
order, priority and proportions as Lender shall deem to be appropriate in its
discretion.
In the event of a sale, by foreclosure, power of sale or otherwise, of less than
all of the Property, this Deed of Trust shall continue as a lien and security
interest on the remaining portion of the Property unimpaired and without loss of
priority.
SECTION 7.2 APPLICATION OF PROCEEDS. The purchase money, proceeds and
avails of any disposition of the Property, and or any part thereof, or any other
sums collected by Lender pursuant to the Note, this Deed of Trust or the other
Loan Documents, may be applied by Lender to the payment of the Debt in such
priority and proportions as Lender in its discretion shall deem proper.
SECTION 7.3 RIGHT TO CURE DEFAULTS. Upon the occurrence and during the
continuance of any Event of Default, Lender may, but without any obligation to
do so and without notice to or demand on Borrower and without releasing Borrower
from any obligation hereunder, make any payment or do any act required of
Borrower hereunder in such manner and to such extent as Lender may deem
necessary to protect the security hereof. Lender is authorized to enter upon the
Property for such purposes, or appear in, defend, or bring any action or
proceeding to protect its interest in the Property or to foreclose this Deed of
Trust or collect the Debt, and the cost and expense thereof (including
reasonable attorneys' fees to the extent permitted by law), with interest as
provided in this SECTION 7.3, shall constitute a portion of the Debt and shall
be due and payable to Lender upon demand. All such costs and expenses incurred
by Lender in remedying such Event of Default or such failed payment or act or in
appearing in, defending, or bringing any such action or proceeding shall bear
interest at the Default Rate, for the period after notice from Lender that such
cost or expense was incurred to the date of payment to Lender. All such costs
and expenses incurred by Lender together with interest thereon calculated at the
Default Rate shall be deemed to constitute a portion of the Debt and be secured
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by this Deed of Trust and the other Loan Documents and shall be immediately due
and payable upon demand by Lender therefor.
SECTION 7.4 ACTIONS AND PROCEEDINGS. Lender has the right to appear in
and defend any action or proceeding brought with respect to the Property and to
bring any action or proceeding, in the name and on behalf of Borrower, which
Lender, in its discretion, decides should be brought to protect its interest in
the Property.
SECTION 7.5 RECOVERY OF SUMS REQUIRED TO BE PAID. Lender shall have the
right from time to time to take action to recover any sum or sums which
constitute a part of the Debt as the same become due, without regard to whether
or not the balance of the Debt shall be due, and without prejudice to the right
of Lender thereafter to bring an action of foreclosure, or any other action, for
a default or defaults by Borrower existing at the time such earlier action was
commenced.
SECTION 7.6 EXAMINATION OF BOOKS AND RECORDS. At reasonable times and
upon reasonable notice, Lender, its agents, accountants and attorneys shall have
the right to examine the records, books, management and other papers of Borrower
which reflect upon the financial condition of the Property or of Borrower, at
the Property or at any office regularly maintained by Borrower where the books
and records are located. Lender and its agents shall have the right to make
copies and extracts from the foregoing records and other papers. In addition, at
reasonable times and upon reasonable notice, Lender, its agents, accountants and
attorneys shall have the right to examine and audit the books and records of
Borrower pertaining to the income, expenses and operation of the Property during
reasonable business hours at any office of Borrower where the books and records
are located. This SECTION 7.6 shall apply throughout the term of the Note and
without regard to whether an Event of Default has occurred or is continuing.
SECTION 7.7 OTHER RIGHTS, ETC. (a) The failure of Lender to insist upon
strict performance of any term hereof shall not be deemed to be a waiver of any
term of this Deed of Trust. Borrower shall not be relieved of Borrower's
obligations hereunder by reason of (i) the failure of Lender to comply with any
request of Borrower or any Guarantor or Indemnifying Person with respect to the
Loan to take any action to foreclose this Deed of Trust or otherwise enforce any
of the provisions hereof or of the Note or the other Loan Documents, (ii) the
release, regardless of consideration, of the whole or any part of the Property,
or of any person liable for the Debt or any portion thereof, or (iii) any
agreement or stipulation by Lender extending the time of payment or otherwise
modifying or supplementing the terms of the Note, this Deed of Trust or the
other Loan Documents.
(b) It is agreed that the risk of loss or damage to the Property is
on Borrower, and Lender shall have no liability whatsoever for decline in value
of the Property, for failure to maintain the Policies, or for failure to
determine whether the insurance in force is adequate as to the amount of risks
insured. Possession by Lender shall not be deemed an election of judicial relief
if any such possession is requested or obtained with respect to any Property or
collateral not in Lender's possession.
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(c) Lender may resort for the payment of the Debt to any other
security held by Lender in such order and manner as Lender, in its discretion,
may elect. Lender may take action to recover the Debt, or any portion thereof,
or to enforce any covenant hereof without prejudice to the right of Lender
thereafter to foreclose this Deed of Trust. The rights of Lender under this Deed
of Trust shall be separate, distinct and cumulative and none shall be given
effect to the exclusion of the others. No act of Lender shall be construed as an
election to proceed under any one provision herein to the exclusion of any other
provision. Lender shall not be limited exclusively to the rights and remedies
herein stated but shall be entitled to every right and remedy now or hereafter
afforded at law or in equity.
SECTION 7.8 RIGHT TO RELEASE ANY PORTION OF THE PROPERTY. Lender may
release any portion of the Property for such consideration as Lender may require
without, as to the remainder of the Property, in any way impairing or affecting
the lien or priority of this Deed of Trust, or improving the position of any
subordinate lienholder with respect thereto, except to the extent that the
obligations hereunder shall have been reduced by the actual monetary
consideration, if any, received by Lender for such release, and may accept by
assignment, pledge or otherwise any other property in place thereof as Lender
may require without being accountable for so doing to any other lienholder. This
Deed of Trust shall continue as a lien and security interest in the remaining
portion of the Property.
SECTION 7.9 VIOLATION OF LAWS. If the Property is not in material
compliance with Legal Requirements, Lender may impose additional requirements
upon Borrower in connection herewith including, without limitation, monetary
reserves or financial equivalents.
SECTION 7.10 RECOURSE AND CHOICE OF REMEDIES. The provisions of Section
9.3 of the Loan Agreement are hereby incorporated by reference into this Deed of
Trust to the same extent and with the same force as if fully set forth herein.
SECTION 7.11 RIGHT OF ENTRY. Upon reasonable notice to Borrower, Lender
and its agents shall have the right to enter and inspect the Property at all
reasonable times.
ARTICLE VIII - ENVIRONMENTAL HAZARDS
SECTION 8.1 ENVIRONMENTAL REPRESENTATIONS AND WARRANTIES. Except as
otherwise disclosed by that certain Phase I environmental report (or Phase II
environmental report, if required) delivered to Lender by Borrower in connection
with the origination of the Loan (such report is referred to below as the
"ENVIRONMENTAL REPORT"), to Borrower's Knowledge (a) there are no Hazardous
Substances (defined below) or underground storage tanks in, on, or under the
Property, except those that are (i) in compliance with Environmental Laws
(defined below) and with permits issued pursuant thereto (to the extent such
permits are required under Environmental Law), (ii) de-minimis amounts necessary
to operate the Property for the purposes set forth in the Loan Agreement which
will not result in an environmental condition in, on or under the Property and
which are otherwise permitted under and used in compliance with Environmental
Law and (iii) fully disclosed to Lender in writing pursuant the Environmental
Report; (b) there are no past, present or threatened Releases (defined below) of
Hazardous Substances in, on, under or from the Property which has not been fully
remediated in accordance with Environmental Law; (c) there is no threat of any
Release of Hazardous Substances
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migrating to the Property; (d) there is no past or present non-compliance with
Environmental Laws, or with permits issued pursuant thereto, in connection with
the Property which has not been fully remediated in accordance with
Environmental Law; (e) Borrower does not know of, and has not received, any
written or oral notice or other communication from any Person (including but not
limited to a Governmental Authority) relating to Hazardous Substances or
Remediation (defined below) thereof, of possible liability of any Person
pursuant to any Environmental Law, other environmental conditions in connection
with the Property, or any actual or potential administrative or judicial
proceedings in connection with any of the foregoing; and (f) Borrower has
truthfully and fully disclosed to Lender, in writing, any and all information
relating to environmental conditions in, on, under or from the Property that is
known to Borrower and has provided to Lender all information that is contained
in Borrower's files and records, including, but not limited to, any reports
relating to Hazardous Substances in, on, under or from the Property and/or to
the environmental condition of the Property.
"ENVIRONMENTAL LAW" means any present and future federal, state and
local laws, statutes, ordinances, rules, regulations and the like, as well as
common law, relating to protection of human health or the environment, relating
to Hazardous Substances, relating to liability for or costs of Remediation or
prevention of Releases of Hazardous Substances or relating to liability for or
costs of other actual or threatened danger to human health or the environment.
Environmental Law includes, but is not limited to, the following statutes, as
amended, any successor thereto, and any regulations promulgated pursuant
thereto, and any state or local statutes, ordinances, rules, regulations and the
like addressing similar issues: the Comprehensive Environmental Response,
Compensation and Liability Act; the Emergency Planning and Community
Right-to-Know Act; the Hazardous Substances Transportation Act; the Resource
Conservation and Recovery Act (including but not limited to Subtitle I relating
to underground storage tanks); the Solid Waste Disposal Act; the Clean Water
Act; the Clean Air Act; the Toxic Substances Control Act; the Safe Drinking
Water Act; the Occupational Safety and Health Act; the Federal Water Pollution
Control Act; the Federal Insecticide, Fungicide and Rodenticide Act; the
Endangered Species Act; the National Environmental Policy Act; and the River and
Harbors Appropriation Act. Environmental Law also includes, but is not limited
to, any present and future federal, state and local laws, statutes, ordinances,
rules, regulations and the like, as well as common law: conditioning transfer of
property upon a negative declaration or other approval of a governmental
authority of the environmental condition of the Property; requiring notification
or disclosure of Releases of Hazardous Substances or other environmental
condition of the Property to any governmental authority or other Person, whether
or not in connection with transfer of title to or interest in property; imposing
conditions or requirements relating to Hazardous Substances in connection with
permits or other authorization for lawful activity; relating to nuisance,
trespass or other causes of action in respect of Hazardous Substances related to
the Property; or, to the extent arising out of the presence of Hazardous
Substances, relating to wrongful death, personal injury, or property or other
damage in connection with any physical condition or use of the Property.
"HAZARDOUS SUBSTANCES" include but are not limited to any and all
substances (whether solid, liquid or gas) defined, listed, or otherwise
classified as pollutants, hazardous wastes, hazardous substances, hazardous
materials, extremely hazardous wastes, or words of similar meaning or regulatory
effect under any present or future Environmental Laws or that may have a
negative impact on human health or the environment, including but not limited to
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petroleum and petroleum products, asbestos and asbestos-containing materials,
polychlorinated biphenyls, lead, radon, radioactive materials, flammables and
explosives, but excluding substances of kinds and in amounts ordinarily and
customarily used or stored in similar properties for the purpose of cleaning or
other maintenance or operations and otherwise in compliance with all
Environmental Laws.
"RELEASE" of any Hazardous Substance includes but is not limited to any
release, deposit, discharge, emission, leaking, spilling, seeping, migrating,
injecting, pumping, pouring, emptying, escaping, dumping, disposing or other
movement of Hazardous Substances.
"REMEDIATION" includes but is not limited to any response, remedial,
removal, or corrective action, any activity to clean-up, detoxify,
decontaminate, contain or otherwise remediate any Hazardous Substance, any
actions to prevent, cure or mitigate any Release of any Hazardous Substance, any
action to comply with any Environmental Laws or with any permits issued pursuant
thereto, any inspection, investigation, study, monitoring, assessment, audit,
sampling and testing, laboratory or other analysis, or evaluation relating to
any Hazardous Substances or to anything referred to in ARTICLE 8.
SECTION 8.2 ENVIRONMENTAL COVENANTS. Borrower covenants and agrees that:
(a) Borrower shall use commercially reasonable efforts to ensure that all uses
and operations on or of the Property shall be in compliance with all
Environmental Laws and permits issued pursuant thereto; (b) Borrower shall use
commercially reasonable efforts to prevent any Releases of Hazardous Substances
in, on, under or from the Property; (c) Borrower shall not permit any Hazardous
Substances in, on, or under the Property, except those that are (i) in
compliance with all Environmental Laws and with permits issued pursuant thereto
(to the extent such permits are required by Environmental Law), (ii) de-minimis
amounts necessary to operate the Property for the purposes set forth in the Loan
Agreement which will not result in an environmental condition in, on or under
the Property and which are otherwise permitted under and used in compliance with
Environmental Law and (iii) fully disclosed to Lender in writing; (d) Borrower
shall keep the Property free and clear of all liens and other encumbrances
imposed pursuant to any Environmental Law, whether due to any act or omission of
Borrower or any other Person (the "ENVIRONMENTAL LIENS"); (e) Borrower shall, at
its sole cost and expense, fully and expeditiously cooperate in all activities
pursuant to SECTION 8.3 below, including but not limited to providing all
relevant information and making knowledgeable persons available for interviews;
(f) Borrower shall, at its sole cost and expense, perform any environmental site
assessment or other investigation of environmental conditions in connection with
the Property, pursuant to any reasonable written request of Lender made in the
event that Lender has reason to believe that an environmental hazard exists on
the Property (including but not limited to sampling, testing and analysis of
soil, water, air, building materials and other materials and substances whether
solid, liquid or gas), and share with Lender the reports and other results
thereof, and Lender and other Indemnified Parties shall be entitled to rely on
such reports and other results thereof; (g) Borrower shall, at its sole cost and
expense, comply with all reasonable written requests of Lender made in the event
that Lender has reason to believe that an environmental hazard exists on the
Property to (i) reasonably effectuate Remediation of any condition (including
but not limited to a Release of a Hazardous Substance) in, on, under or from the
Property; (ii) comply with any Environmental Law; (iii) comply with any
directive from any Governmental Authority; and (iv) take any other reasonable
action necessary or appropriate for
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protection of human health or the environment; (h) Borrower shall not do or
allow any tenant or other user of the Property to do any act with respect to
Hazardous Substances that materially increases the dangers to human health or
the environment, poses an unreasonable risk of harm to any Person (whether on or
off the Property), impairs or may impair the value of the Property, is contrary
to any requirement of any insurer, constitutes a public or private nuisance,
constitutes waste, or violates any covenant, condition, agreement or easement
applicable to the Property; and (i) Borrower shall immediately notify Lender in
writing of (A) any presence or Releases or threatened Releases of Hazardous
Substances in, on, under, from or migrating towards the Property; (B) any
non-compliance with any Environmental Laws related in any way to the Property;
(C) any actual or potential Environmental Lien; (D) any required or proposed
Remediation of environmental conditions relating to the Property; and (E) any
written notice or other written communication of which Borrower becomes aware
from any source whatsoever (including but not limited to a governmental entity)
relating in any way to Hazardous Substances or Remediation thereof, possible
liability of any Person pursuant to any Environmental Law, other environmental
conditions in connection with the Property, or any actual or potential
administrative or judicial proceedings in connection with anything referred to
in this ARTICLE 8.
SECTION 8.3 LENDER'S RIGHTS. In the event that Lender has reason to
believe that an environmental hazard exists on the Property that does not, in
Lender's sole discretion, endanger any tenants or other occupants of the
Property or their guests or the general public or materially and adversely
affect the value of the Property, upon reasonable notice from Lender, Borrower
shall, at Borrower's expense, promptly cause an engineer or consultant
satisfactory to Lender to conduct an environmental assessment or audit (the
scope of which shall be determined in Lender's sole and absolute discretion) and
take any samples of soil, groundwater or other water, air, or building materials
or any other invasive testing requested by Lender and promptly deliver the
results of any such assessment, audit, sampling or other testing; provided,
however, if such results are not delivered to Lender within a reasonable period
or if Lender has reason to believe that an environmental hazard exists on the
Property that, in Lender's sole judgment, endangers any tenant or other occupant
of the Property or their guests or the general public or may materially and
adversely affect the value of the Property, upon reasonable notice to Borrower,
Lender and any other Person designated by Lender, including but not limited to
any receiver, any representative of a governmental entity, and any environmental
consultant, shall have the right, but not the obligation, to enter upon the
Property at all reasonable times to assess any and all aspects of the
environmental condition of the Property and its use, including but not limited
to conducting any environmental assessment or audit (the scope of which shall be
determined in Lender's sole and absolute discretion) and taking samples of soil,
groundwater or other water, air, or building materials, and reasonably
conducting other invasive testing. Borrower shall cooperate with and provide
Lender and any such Person designated by Lender with access to the Property.
ARTICLE IX - INDEMNIFICATION
SECTION 9.1 GENERAL INDEMNIFICATION. Borrower shall, at its sole cost
and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all claims, suits, liabilities
(including, without limitation, strict liabilities), actions, proceedings,
obligations, debts, damages, losses, costs, expenses, diminutions in value,
fines, penalties, charges, fees, expenses, judgments, awards, amounts paid in
settlement, punitive
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damages, foreseeable and unforeseeable consequential damages, of whatever kind
or nature (including but not limited to reasonable attorneys' fees and other
costs of defense) (collectively, the "LOSSES") imposed upon or incurred by or
asserted against any Indemnified Parties and directly or indirectly arising out
of or in any way relating to any one or more of the following, except, in each
case, to the extent arising out of any Indemnified Party's gross negligence or
willful misconduct: (a) ownership of this Deed of Trust, the Property or any
interest therein or receipt of any Rents; (b) any amendment to, or restructuring
of, the Debt, the Note, the Loan Agreement, this Deed of Trust, or any other
Loan Documents; (c) any and all lawful action that may be taken by Lender in
connection with the enforcement of the provisions of this Deed of Trust, the
Loan Agreement, the Note or any of the other Loan Documents, whether or not suit
is filed in connection with same, or in connection with Borrower, any Guarantor
or Indemnifying Person and/or any partner, joint venturer or shareholder thereof
becoming a party to a voluntary or involuntary federal or state bankruptcy,
insolvency or similar proceeding; (d) any accident, injury to or death of
persons or loss of or damage to property occurring in, on or about the Property
or any part thereof or on the adjoining sidewalks, curbs, adjacent property or
adjacent parking areas, streets or ways; (e) any use, nonuse or condition in, on
or about the Property or any part thereof or on the adjoining sidewalks, curbs,
adjacent property or adjacent parking areas, streets or ways; (f) any failure on
the part of Borrower to perform or be in compliance with any of the terms of
this Deed of Trust, the Note, the Loan Agreement or any of the other Loan
Documents; (g) performance of any labor or services or the furnishing of any
materials or other property in respect of the Property or any part thereof; (h)
the failure of any person to file timely with the Internal Revenue Service an
accurate Form ▇▇▇▇-▇, ▇▇▇▇▇▇▇▇▇ for Recipients of Proceeds from Real Estate,
Broker and Barter Exchange Transactions, which may be required in connection
with this Deed of Trust, or to supply a copy thereof in a timely fashion to the
recipient of the proceeds of the transaction in connection with which this Deed
of Trust is made; (i) any failure of the Property to be in compliance with any
Legal Requirements; (j) the enforcement by any Indemnified Party of the
provisions of this ARTICLE 9; (k) any and all claims and demands whatsoever
which may be asserted against Lender by reason of any alleged obligations or
undertakings on its part to perform or discharge any of the terms, covenants, or
agreements contained in any Lease; (l) the payment of any commission, charge or
brokerage fee to anyone claiming through Borrower which may be payable in
connection with the funding of the Loan; or (m) any misrepresentation made by
Borrower in this Deed of Trust or any other Loan Document. Any amounts payable
to Lender by reason of the application of this SECTION 9.1 shall become
immediately due and payable and shall bear interest at the Default Rate from the
date loss or damage is sustained by Lender until paid. For purposes of this
ARTICLE 9, the term "INDEMNIFIED PARTIES" means Lender and any Person who is or
will have been involved in the origination of the Loan, any Person who is or
will have been involved in the servicing of the Loan secured hereby, any Person
in whose name the encumbrance created by this Deed of Trust is or will have been
recorded, any Person who may hold or acquire or will have held a full or partial
interest in the Loan secured hereby (including, but not limited to, investors or
prospective investors in the Securities, as well as custodians, trustees and
other fiduciaries who hold or have held a full or partial interest in the Loan
secured hereby for the benefit of third parties) as well as the respective
directors, officers, shareholders, partners, employees, agents, servants,
representatives, contractors, subcontractors, affiliates, subsidiaries,
participants, successors and assigns of any and all of the foregoing (including,
but not limited to, any other Person who holds or acquires or will have held a
participation or other full or partial interest in the Loan, whether
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during the term of the Loan or as a part of or following a foreclosure of the
Loan and any successors by merger, consolidation or acquisition of all or a
substantial portion of Lender's assets and business).
SECTION 9.2 DEED OF TRUST AND/OR INTANGIBLE TAX. Borrower shall, at its
sole cost and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all Losses imposed upon or incurred
by or asserted against any Indemnified Parties and directly or indirectly
arising out of or in any way relating to any tax on the making and/or recording
of this Deed of Trust, the Note or any of the other Loan Documents, but
excluding any income, franchise or other similar taxes.
SECTION 9.3 ERISA INDEMNIFICATION. Borrower shall, at its sole cost and
expense, protect, defend, indemnify, release and hold harmless the Indemnified
Parties from and against any and all Losses (including, without limitation,
reasonable attorneys' fees and costs incurred in the investigation, defense, and
settlement of Losses incurred in correcting any prohibited transaction or in the
sale of a prohibited loan, and in obtaining any individual prohibited
transaction exemption under ERISA that may be required, in Lender's sole
discretion) that Lender may incur, directly or indirectly, as a result of a
default under Sections 4.1.9 or 5.2.12 of the Loan Agreement.
SECTION 9.4 ENVIRONMENTAL INDEMNIFICATION. Borrower shall, at its sole
cost and expense, protect, defend, indemnify, release and hold harmless the
Indemnified Parties from and against any and all Losses and costs of Remediation
(whether or not performed voluntarily), engineers' fees, environmental
consultants' fees, and costs of investigation (including but not limited to
sampling, testing, and analysis of soil, water, air, building materials and
other materials and substances whether solid, liquid or gas) imposed upon or
incurred by or asserted against any Indemnified Parties, and arising out of or
in any way relating to any one or more of the following: (a) any presence of any
Hazardous Substances in, on, above, or under the Property; (b) any past, present
or threatened Release of Hazardous Substances in, on, above, under or from the
Property; (c) any activity by Borrower, any Person affiliated with Borrower or
any tenant or other user of the Property in connection with any actual, proposed
or threatened use, treatment, storage, holding, existence, disposition or other
Release, generation, production, manufacturing, processing, refining, control,
management, abatement, removal, handling, transfer or transportation to or from
the Property of any Hazardous Substances at any time located in, under, on or
above the Property; (d) any activity by Borrower, any Person affiliated with
Borrower or any tenant or other user of the Property in connection with any
actual or proposed Remediation of any Hazardous Substances at any time located
in, under, on or above the Property, whether or not such Remediation is
voluntary or pursuant to court or administrative order, including but not
limited to any removal, remedial or corrective action; (e) any past or present
non-compliance or violations of any Environmental Laws (or permits issued
pursuant to any Environmental Law) in connection with the Property or operations
thereon, including but not limited to any failure by Borrower, any Affiliate of
Borrower or any tenant or other user of the Property to comply with any order of
any Governmental Authority in connection with any Environmental Laws; (f) the
imposition, recording or filing of any Environmental Lien encumbering the
Property; (g) any administrative processes or proceedings or judicial
proceedings in any way connected with any matter addressed in ARTICLE 8 and this
SECTION 9.4; (h) any past, present or threatened injury to, destruction of or
loss of natural resources in any way
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connected with the Property, including but not limited to costs to investigate
and assess such injury, destruction or loss; (i) any acts of Borrower or other
users of the Property in arranging for disposal or treatment, or arranging with
a transporter for transport for disposal or treatment, of Hazardous Substances
owned or possessed by such Borrower or other users, at any facility or
incineration vessel owned or operated by another Person and containing such or
any similar Hazardous Substance; (j) any acts of Borrower or other users of the
Property, in accepting any Hazardous Substance for transport to disposal or
treatment facilities, incineration vessels or sites selected by Borrower or such
other users, from which there is a Release, or a threatened Release of any
Hazardous Substance which causes the incurrence of costs for Remediation; (k)
any personal injury, wrongful death, or property damage arising under any
statutory or common law or tort law theory, including but not limited to damages
assessed for the maintenance of a private or public nuisance or for the
conducting of an abnormally dangerous activity on or near the Property, in each
case, to the extent arising out of the presence of Hazardous Substances; and (1)
any misrepresentation or inaccuracy in any representation or warranty or
material breach or failure to perform any covenants or other obligations
pursuant to ARTICLE 8. This indemnity shall survive any termination,
satisfaction or foreclosure of this Deed of Trust, subject to the provisions of
SECTION 10.5. Notwithstanding the foregoing, Borrower shall have no liability
for any Losses imposed upon or incurred by or asserted against any Indemnified
Parties and described in this SECTION 9.4 to the extent that such Losses arose
solely by actions, conditions or events relating to the Hazardous Substances
placed in, on, above or under the Property after the date that Lender or any
Affiliate or nominee of Lender (or any purchaser at a foreclosure sale) actually
acquired title to the Property and were not caused by the direct or indirect
actions of Borrower or any officer or director of Borrower or any employee,
agent, contractor or Affiliate of Borrower.
SECTION 9.5 DUTY TO DEFEND; ATTORNEYS' FEES AND OTHER FEES AND EXPENSES.
Upon written request by any Indemnified Party, Borrower shall defend such
Indemnified Party (if requested by any Indemnified Party, in the name of the
Indemnified Party) by attorneys and other professionals approved by the
Indemnified Parties. Notwithstanding the foregoing, if the defendants in any
such claim or proceeding include both Borrower and any Indemnified Party and
Borrower and such Indemnified Party shall have reasonably concluded that there
are any legal defenses available to it and/or other Indemnified Parties that are
different from or additional to those available to Borrower, such Indemnified
Party shall have the right to select separate counsel to assert such legal
defenses and to otherwise participate in the defense of such action on behalf of
such Indemnified Party, provided that no compromise or settlement shall be
entered without Borrower's consent, which consent shall not be unreasonably
withheld. Upon demand, Borrower shall pay or, in the sole and absolute
discretion of the Indemnified Parties, reimburse, the Indemnified Parties for
the payment of reasonable fees and disbursements of attorneys, engineers,
environmental consultants, laboratories and other professionals in connection
therewith.
ARTICLE X - WAIVERS
SECTION 10.1 WAIVER OF COUNTERCLAIM. To the extent permitted by
applicable law, Borrower hereby waives the right to assert a counterclaim, other
than a mandatory or compulsory counterclaim, in any action or proceeding brought
against it by Lender arising out of
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or in any way connected with this Deed of Trust, the Loan Agreement, the Note,
any of the other Loan Documents, or the Obligations.
SECTION 10.2 MARSHALLING AND OTHER MATTERS. To the extent permitted by
applicable law, Borrower hereby waives the benefit of all appraisement,
valuation, stay, extension, reinstatement and redemption laws now or hereafter
in force and all rights of marshalling in the event of any sale hereunder of the
Property or any part thereof or any interest therein. Further, Borrower hereby
expressly waives any and all rights of redemption from sale under any order or
decree of foreclosure of this Deed of Trust on behalf of Borrower, and on behalf
of each and every person acquiring any interest in or title to the Property
subsequent to the date of this Deed of Trust and on behalf of all persons to the
extent permitted by applicable law.
SECTION 10.3 WAIVER OF NOTICE. To the extent permitted by applicable
law, Borrower shall not be entitled to any notices of any nature whatsoever from
Lender except with respect to matters for which this Deed of Trust or any other
Loan Document specifically and expressly provides for the giving of notice by
Lender to Borrower and except with respect to matters for which Lender is
required by applicable law to give notice, and Borrower hereby expressly waives
the right to receive any notice from Lender with respect to any matter for which
this Deed of Trust does not specifically and expressly provide for the giving of
notice by Lender to Borrower.
SECTION 10.4 WAIVER OF STATUTE OF LIMITATIONS. To the extent permitted
by applicable law, Borrower hereby expressly waives and releases to the fullest
extent permitted by law, the pleading of any statute of limitations as a defense
to payment of the Debt or performance of its Other Obligations.
SECTION 10.5 SURVIVAL. The indemnifications made pursuant to SECTIONS
9.3 and 9.4 herein and the representations and warranties, covenants, and other
obligations arising under ARTICLE 8, shall continue indefinitely in full force
and effect and shall survive and shall in no way be impaired by any of the
following: any satisfaction or other termination of this Deed of Trust, any
assignment or other transfer of all or any portion of this Deed of Trust or
Lender's interest in the Property (but, in such case, shall benefit both
Indemnified Parties and any assignee or transferee), any exercise of Lender's
rights and remedies pursuant hereto including, but not limited to, foreclosure
or acceptance of a deed in lieu of foreclosure, any exercise of any rights and
remedies pursuant to the Loan Agreement, the Note or any of the other Loan
Documents, any transfer of all or any portion of the Property (whether by
Borrower or by Lender following foreclosure or acceptance of a deed in lieu of
foreclosure or at any other time), any amendment to this Deed of Trust, the Loan
Agreement, the Note or the other Loan Documents, and any act or omission that
might otherwise be construed as a release or discharge of Borrower from the
obligations pursuant hereto.
ARTICLE XI - EXCULPATION
The provisions of Section 9.3 of the Loan Agreement are hereby
incorporated by reference into this Deed of Trust to the same extent and with
the same force as if fully set forth herein.
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ARTICLE XII - NOTICES
All notices or other written communications hereunder shall be delivered
in accordance with Section 10.6 of the Loan Agreement.
ARTICLE XIII - APPLICABLE LAW
SECTION 13.1 GOVERNING LAW. This Deed of Trust shall be governed in
accordance with the terms and provisions of Section 10.3 of the Loan Agreement.
SECTION 13.2 USURY LAWS. Notwithstanding anything to the contrary, (a)
all agreements and communications between Borrower and Lender are hereby and
shall automatically be limited so that, after taking into account all amounts
deemed interest, the interest contracted for, charged or received by Lender
shall never exceed the Maximum Legal Rate or amount, (b) in calculating whether
any interest exceeds the Maximum Legal Rate, all such interest shall be
amortized, prorated, allocated and spread over the full amount and term of all
principal indebtedness of Borrower to Lender, and (c) if through any contingency
or event, Lender receives or is deemed to receive interest in excess of the
Maximum Legal Rate, any such excess shall be deemed to have been applied toward
payment of the principal of any and all then outstanding indebtedness of
Borrower to Lender, or if there is no such indebtedness, shall immediately be
returned to Borrower.
SECTION 13.3 PROVISIONS SUBJECT TO APPLICABLE LAW. All rights, powers
and remedies provided in this Deed of Trust may be exercised only to the extent
that the exercise thereof does not violate any applicable provisions of law and
are intended to be limited to the extent necessary so that they will not render
this Deed of Trust invalid, unenforceable or not entitled to be recorded,
registered or filed under the provisions of any applicable law. If any term of
this Deed of Trust or any application thereof shall be invalid or unenforceable,
the remainder of this Deed of Trust and any other application of the term shall
not be affected thereby.
ARTICLE XIV - DEFINITIONS
All capitalized terms not defined herein shall have the respective
meanings set forth in the Loan Agreement. Unless the context clearly indicates a
contrary intent or unless otherwise specifically provided herein, words used in
this Deed of Trust may be used interchangeably in singular or plural form and
the word "BORROWER" shall mean "each Borrower and any subsequent owner or owners
of a fee interest in the Property or any part thereof, the word "LENDER" shall
mean "Lender and any subsequent holder of the Note," the word "NOTE" shall mean
"the Note and any other evidence of indebtedness secured by this Deed of Trust,"
the word "PROPERTY" shall include any portion of the Property and any interest
therein, and the phrases "ATTORNEYS' FEES", "LEGAL FEES" and "COUNSEL FEES"
shall include any and all attorneys', paralegal and law clerk fees and
disbursements, including, but not limited to, fees and disbursements at the
pre-trial, trial and appellate levels incurred or paid by Lender in protecting
its interest in the Property, the Leases and the Rents and enforcing its rights
hereunder.
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ARTICLE XV - MISCELLANEOUS PROVISIONS
SECTION 15.1 NO ORAL CHANGE. This Deed of Trust, and any provisions
hereof, may not be modified, amended, waived, extended, changed, discharged or
terminated orally or by any act or failure to act on the part of Borrower or
Lender, but only by an agreement in writing signed by the party against whom
enforcement of any modification, amendment, waiver, extension, change, discharge
or termination is sought.
SECTION 15.2 SUCCESSORS AND ASSIGNS. This Deed of Trust shall be binding
upon and inure to the benefit of Borrower and Lender and their respective
successors and assigns forever.
SECTION 15.3 INAPPLICABLE PROVISIONS. If any term, covenant or condition
of the Loan Agreement, the Note or this Deed of Trust is held to be invalid,
illegal or unenforceable in any respect, the Loan Agreement, the Note and this
Deed of Trust shall be construed without such provision.
SECTION 15.4 HEADINGS, ETC. The headings and captions of various
Sections of this Deed of Trust are for convenience of reference only and are not
to be construed as defining or limiting, in any way, the scope or intent of the
provisions hereof.
SECTION 15.5 NUMBER AND GENDER. Whenever the context may require, any
pronouns used herein shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns and pronouns shall include the
plural and vice versa.
SECTION 15.6 SUBROGATION. If any or all of the proceeds of the Note have
been used to extinguish, extend or renew any indebtedness heretofore existing
against the Property, then, to the extent of the funds so used, Lender shall be
subrogated to all of the rights, claims, liens, titles, and interests existing
against the Property heretofore held by, or in favor of, the holder of such
indebtedness and such former rights, claims, liens, titles, and interests, if
any, are not waived but rather are continued in full force and effect in favor
of Lender and are merged with the lien and security interest created herein as
cumulative security for the repayment of the Debt, the performance and discharge
of Borrower's obligations hereunder, under the Loan Agreement, the Note and the
other Loan Documents and the performance and discharge of the Other Obligations.
SECTION 15.7 ENTIRE AGREEMENT. The Note, the Loan Agreement, this Deed
of Trust and the other Loan Documents constitute the entire understanding and
agreement between Borrower and Lender with respect to the transactions arising
in connection with the Debt and supersede all prior written or oral
understandings and agreements between Borrower and Lender with respect thereto.
Borrower hereby acknowledges that, except as incorporated in writing in the
Note, the Loan Agreement, this Deed of Trust and the other Loan Documents, there
are not, and were not, and no persons are or were authorized by Lender to make,
any representations, understandings, stipulations, agreements or promises, oral
or written, with respect to the transaction which is the subject of the Note,
the Loan Agreement, this Deed of Trust and the other Loan Documents.
- 25 -
SECTION 15.8 LIMITATION ON LENDER'S RESPONSIBILITY. No provision of this
Deed of Trust shall operate to place any obligation or liability for the
control, care, management or repair of the Property upon Lender, nor shall it
operate to make Lender responsible or liable for any waste committed on the
Property by the tenants or any other Person, or for any dangerous or defective
condition of the Property, or for any negligence in the management, upkeep,
repair or control of the Property resulting in loss or injury or death to any
tenant, licensee, employee or stranger. Nothing herein contained shall be
construed as constituting Lender a "mortgagee in possession."
ARTICLE XVI - DEED OF TRUST PROVISIONS
SECTION 16.1 CONCERNING THE TRUSTEE. Trustee shall be under no duty to
take any action hereunder except as expressly required hereunder or by law, or
to perform any act which would involve Trustee in any expense or liability or to
institute or defend any suit in respect hereof, unless properly indemnified to
Trustee's reasonable satisfaction. Trustee, by acceptance of this Deed of Trust,
covenants to perform and fulfill the trusts herein created, being liable,
however, only for gross negligence or willful misconduct, and hereby waives any
statutory fee and agrees to accept reasonable compensation, in lieu thereof, for
any services rendered by Trustee in accordance with the terms hereof. Trustee
may resign at any time upon giving thirty (30) days' notice to Borrower and to
Lender. Lender may remove Trustee at any time or from time to time and select a
successor trustee. In the event of the death, removal, resignation, refusal to
act, or inability to act of Trustee, or in its sole discretion for any reason
whatsoever Lender may, without notice and without specifying any reason therefor
and without applying to any court, select and appoint a successor trustee, by an
instrument recorded wherever this Deed of Trust is recorded and all powers,
rights, duties and authority of Trustee, as aforesaid, shall thereupon become
vested in such successor. Such substitute trustee shall not be required to give
bond for the faithful performance of the duties of Trustee hereunder unless
required by Lender. The procedure provided for in this paragraph for
substitution of Trustee shall be in addition to and not in exclusion of any
other provisions for substitution, by law or otherwise.
SECTION 16.2 TRUSTEE'S FEES. Borrower shall pay all reasonable costs,
fees and expenses incurred by Trustee and Trustee's agents and counsel in
connection with the performance by Trustee of Trustee's duties hereunder and all
such costs, fees and expenses shall be secured by this Deed of Trust.
SECTION 16.3 CERTAIN RIGHTS. With the approval of Lender, Trustee shall
have the right to take any and all of the following actions: (a) to select,
employ, and advise with counsel (who may be, but need not be, counsel for
Lender) upon any matters arising hereunder, including the preparation,
execution, and interpretation of the Note, this Deed of Trust or the Other Loan
Documents, and shall be fully protected in relying as to legal matters on the
advice of counsel, (b) to execute any of the trusts and powers hereof and to
perform any duty hereunder either directly or through his/her agents or
attorneys, (c) to select and employ, in and about the execution of his/her
duties hereunder, suitable accountants, engineers and other experts, agents and
attorneys-in-fact, either corporate or individual, not regularly in the employ
of Trustee, and Trustee shall not be answerable for any act, default,
negligence, or misconduct of any such accountant, engineer or other expert,
agent or attorney-in-fact, if selected with reasonable care,
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or for any error of judgment or act done by Trustee in good faith, or be
otherwise responsible or accountable under any circumstances whatsoever, except
for Trustee's gross negligence or bad faith and (d) any and all other lawful
action as Lender may instruct Trustee to take to protect or enforce Lender's
rights hereunder. Trustee shall not be personally liable in case of entry by
Trustee, or anyone entering by virtue of the powers herein granted to Trustee,
upon the Property for debts contracted for or liability or damages incurred in
the management or operation of the Property. Trustee shall have the right to
rely on any instrument, document, or signature authorizing or supporting an
action taken or proposed to be taken by Trustee hereunder, believed by Trustee
in good faith to be genuine. Trustee shall be entitled to reimbursement for
actual expenses incurred by Trustee in the performance of Trustee's duties
hereunder and to reasonable compensation for such of Trustee's services
hereunder as shall be rendered.
SECTION 16.4 RETENTION OF MONEY. All moneys received by Trustee shall,
until used or applied as herein provided, be held in trust for the purposes for
which they were received, but need not be segregated in any manner from any
other moneys (except to the extent required by applicable law) and Trustee shall
be under no liability for interest on any moneys received by Trustee hereunder.
SECTION 16.5 PERFECTION OF APPOINTMENT. Should any deed, conveyance, or
instrument of any nature be required from Borrower by any Trustee or substitute
trustee to more fully and certainly vest in and confirm to the Trustee or
substitute trustee such estates rights, powers, and duties, then, upon request
by the Trustee or substitute trustee, any and all such deeds, conveyances and
instruments shall be made, executed, acknowledged, and delivered and shall be
caused to be recorded and/or filed by Borrower.
SECTION 16.6 SUCCESSION INSTRUMENTS. Any substitute trustee appointed
pursuant to any of the provisions hereof shall, without any further act, deed,
or conveyance, become vested with all the estates, properties, rights, powers,
and trusts of its or his/her predecessor in the rights hereunder with like
effect as if originally named as Trustee herein; but nevertheless, upon the
written request of Lender or of the substitute trustee, the Trustee ceasing to
act shall execute and deliver any instrument transferring to such substitute
trustee, upon the trusts herein expressed, all the estates, properties, rights,
powers, and trusts of the Trustee so ceasing to act, and shall duly assign,
transfer and deliver any of the property and moneys held by such Trustee to the
substitute trustee so appointed in the Trustee's place.
ARTICLE XVII - STATE-SPECIFIC PROVISIONS
SECTION 17.1 PRINCIPLES OF CONSTRUCTION. In the event of any
inconsistencies between the terms and conditions of this ARTICLE 17 and the
terms and conditions of this Deed of Trust, the terms and conditions of this
ARTICLE 17 shall control and be binding.
SECTION 17.2 REMEDIES NOT EXCLUSIVE; WAIVER. Trustee and Lender shall
have all powers, rights and remedies under applicable law whether or not
specifically or generally granted or described in this Deed of Trust. Nothing
contained herein shall be construed to impair or to restrict such powers, rights
and remedies or to preclude any procedures or process otherwise available to
trustees or beneficiaries under deeds of trust in the State of California.
Trustee and Lender, and each of them, shall be entitled to enforce the payment
and performance
- 27 -
of any indebtedness or obligations secured hereby and to exercise all rights and
powers under this Deed of Trust or under any other Loan Document or other
agreement or any laws now or hereafter in force, notwithstanding the fact that
some or all of the indebtedness and obligations secured hereby may now or
hereafter be otherwise secured, whether by mortgage, deed of trust, pledge,
lien, assignment or otherwise. Neither the acceptance of this Deed of Trust nor
its enforcement, whether by court action or pursuant to the power of sale or
other powers contained herein, shall prejudice or in any manner affect Trustee's
or Lender's right to realize upon or enforce any other rights or security now or
hereafter held by Trustee or Lender. Trustee and Lender, and each of them, shall
be entitled to enforce this Deed of Trust and any other rights or security now
or hereafter held by Lender or Trustee in such order and manner as they or
either of them may in their absolute discretion determine. No remedy herein
conferred upon or reserved to Trustee or Lender is intended to be exclusive of
any other remedy contained herein or by law provided or permitted, but each
shall be cumulative and in addition to every other remedy given hereunder or now
or hereafter existing at law or in equity. Every power or remedy given by any of
the Loan Documents to Trustee or Lender, or to which either 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 Lender, and either
of them may pursue inconsistent remedies. By exercising or by failing to
exercise any right, option or election hereunder, Lender shall not be deemed to
have waived any provision hereof or to have released Borrower from any of the
obligations secured hereby unless such waiver or release is in writing and
signed by Lender. The waiver by Lender of Borrower's failure to perform or
observe any term, covenant or condition referred to or contained herein to be
performed or observed by Borrower shall not be deemed to be a waiver of such
term, covenant or condition or of any subsequent failure of Borrower to perform
or observe the same or any other such term, covenant or condition referred to or
contained herein, and no custom or practice which may develop between Borrower
and Lender during the term hereof shall be deemed a waiver of or in any way
affect the right of Lender to insist upon the performance by Borrower of the
obligations secured hereby in strict accordance with the terms hereof or of any
other Loan Document.
SECTION 17.3 POWER OF SALE. (i) Should Lender elect to foreclose by
exercise of the power of sale contained herein, Lender shall notify Trustee and
shall, if required, deposit with Trustee the Note, the original or a certified
copy of this Deed of Trust, and such other documents, receipts and evidences of
expenditures made and secured hereby as Trustee may require. Upon receipt of
such notice from Lender, Trustee shall cause to be recorded and delivered to
Borrower such notice as may then be required by law and by this Deed of Trust.
Trustee shall, without demand on Borrower, after lapse of such time as may then
be required by law and after recordation of such notice of default and after
notice of sale has been given as required by law, 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 lots or parcels or items as Trustee shall deem expedient, 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 the time of sale. Trustee shall
deliver to the purchaser or purchasers at such sale its good and sufficient deed
or deeds conveying the property so sold, but without any covenant or warranty,
express or implied. The recitals in such deed of any matters or facts shall be
conclusive proof of the truthfulness thereof Any person, including, without
limitation, Borrower, Trustee or Lender, may purchase at such sale, and Borrower
hereby covenants to warrant and defend the title of such purchaser or
purchasers. Borrower requests
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that a copy of any notice of default or notice of sale be delivered to it at its
mailing address set forth on the first page of this Deed of Trust to the extent
required by applicable law.
(ii) After deducting all costs, fees and expenses of Trustee and of
this Deed of Trust, including, without limitation, costs of evidence of title
and actual and customary attorneys' fees of Trustee or Lender in connection with
a sale as provided in subparagraph (i) above, Trustee shall apply the proceeds
of such sale (a) first, to the payment of all sums expended by Lender under the
terms of any of the Loan Documents and not yet repaid, together with interest on
such sums at the Default Rate as set forth in the Note, (b) second, to the
payment of all sums expended under the terms hereof not then repaid, with
accrued interest at the rate of interest equal to the rate then in effect under
the Note, or if the Note has been repaid, the rate that would have been in
effect under the Note, (c) third, to the payment of all other sums then secured
hereby, and (d) fourth, the remainder, if any, to the person or persons legally
entitled thereto.
SECTION 17.4 RIGHT OF RESCISSION. Lender may from time to time rescind
any notice of default or notice of sale before any Trustee's sale in accordance
with the laws of the State of California. The exercise by Lender 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 Lender to execute and
deliver to Trustee, as above provided, other declarations or notices of default
to satisfy the obligations of this Deed of Trust or secured hereby, nor
otherwise affect any provision, covenant or condition of any Loan Document or
any of the rights, obligations or remedies of Trustee or Lender hereunder or
thereunder.
SECTION 17.5 FULL RECONVEYANCE. Upon written request of Lender stating
that all sums secured hereby have been paid, upon surrender to Trustee of the
Note and the original or a certified copy of this Deed of Trust for cancellation
and retention, and upon payment of its fees, Trustee shall fully reconvey,
without warranty, the entire remaining Property then held hereunder. The
recitals in such reconveyance of any matters of 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."
SECTION 17.6 FIXTURE FILING. This Deed of Trust constitutes a fixture
filing under the fixture filing provisions of the UCC, Sections 9-313 and
9-402(6) as enacted and under the equivalent statutes in the State of
California, as amended or recodified from time to time.
SECTION 17.7 BORDER ZONE PROPERTY. Borrower represents and warrants that
the Property has not been designated as Border Zone Property under the
provisions of California Health and Safety Code, Sections 25220 ET SEQ. or any
regulation adopted in accordance therewith, and there has been no occurrence or
condition on any real property adjoining or in the vicinity of the Property that
is reasonably likely to cause the Property or any part thereof to be designated
as Border Zone Property.
SECTION 17.8 ADDITIONAL SECURITY AGREEMENT PROVISIONS.
(a) With respect to fixtures, Lender or Trustee may elect to treat
same as either real property or personal property and proceed to exercise such
rights and remedies applicable to the categorization so chosen. Lender may
proceed against the items of real property
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and any items of Property separately or together in any order whatsoever,
without in any way affecting or waiving Lender's rights and remedies under the
Uniform Commercial Code, this Deed of Trust or the Note. Borrower acknowledges
and agrees that Lender's rights and remedies under this Deed of Trust and the
Note shall be cumulative and shall be in addition to every other right and
remedy now or hereafter existing at law, in equity, by statute or by agreement
of the parties.
(b) Borrower agrees that this Deed of Trust constitutes a financing
statement filed as a fixture filing in the Official Records of Los Angeles
County with respect to any and all fixtures included within the term "Land" or
"Property" as used herein and with respect to any goods and other personal
property that may now be or hereafter become fixtures. The names and mailing
addresses of the debtor (Borrower) and the secured party (Lender) are set forth
on the first page of this Deed of Trust. Borrower is the record owner of the
Property. The personal property described above is the collateral covered by
this financing statement. Any reproduction of this Deed of Trust or any other
security agreement or financing statement shall be sufficient as a financing
statement.
SECTION 17.9 ADDITIONAL WAIVERS.
(a) Borrower has read and hereby approves the Note, this Deed of
Trust, the other Loan Documents and all other agreements and documents relating
thereto. Borrower acknowledges that it has been represented by counsel of its
choice to review this Deed of Trust, the Note, the other Loan Documents and all
other documents relating thereto and said counsel has explained and Borrower
understands the provisions thereof, or that Borrower has voluntarily declined to
retain such counsel.
(b) Borrower hereby expressly waives diligence, demand, presentment,
protest and notice of every kind and nature whatsoever (unless as otherwise
required under this Deed of Trust) and waives any right to require Lender to
enforce any remedy against any guarantor, endorser or other person whatsoever
prior to the exercise of its rights and remedies hereunder or otherwise.
Borrower waives any right to require Lender to: (i) proceed or exhaust any
collateral security given or held by Lender in connection with the Obligations;
(ii) give notice of the terms, time and place of any public or private sale of
any real or personal property security for the Obligations or other guaranty of
the Obligations; or (iii) pursue any other remedy in Lender's power whatsoever.
(c) Until all Obligations shall have been paid in full, Borrower:
(i) shall not have any right of subrogation to any of the rights of Lender
against any guarantor, maker or endorser; (ii) waives any right to enforce any
remedy which Lender now has or may hereafter have against any other guarantor,
maker or endorser; and (iii) waives any benefit of, and any other right to
participate in, any collateral security for the Obligations or any guaranty of
the Obligations now or hereafter held by Lender.
SECTION 17.10 ADDITIONAL ENVIRONMENTAL PROVISIONS. The following
statutes are hereby deemed to be included in the definition of Environmental
Laws as that term is used throughout this Deed of Trust: the ▇▇▇▇▇▇-Cologne
Water Control Act; the Waste Management
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Act of 1980; the Toxic Pit Cleanup Act; the Underground Tank Act of 1984; the
California Water Quality Improvement Act; and California Health and Safety Codes
▇▇.▇▇. 25117 and 25316.
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IN WITNESS WHEREOF, this Deed of Trust has been executed by Borrower as
of the day and year first above written.
BORROWER:
BEHRINGER HARVARD WESTERN PORTFOLIO LP,
a Delaware limited partnership
By: Behringer Harvard Western Portfolio
GP, LLC, a Delaware limited liability
company
By:
------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, III
Secretary
ACKNOWLEDGEMENT
STATE OF )
---------------------------
) ss.:
COUNTY OF )
--------------------------
On July ____, 2005, before me, _____________________________, a Notary
Public for said state, personally appeared ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, III, personally
known to me (or proved to me on the basis of satisfactory evidence) to be the
person whose name is subscribed to the within instrument and acknowledged to me
that he/she executed the same in his/her authorized capacity, and that by
his/her signature on the instrument the person or the entity upon behalf of
which the person acted, executed the instrument.
WITNESS my hand and official seal.
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Notary Public
(SEAL)
EXHIBIT A
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LEGAL DESCRIPTION
-----------------
▇▇▇. ▇-▇