Securities and Exchange Commission v. Nadel et al

Filing 1342

OBJECTION re 1332 MOTION for miscellaneous relief, specifically for an Order Directing Receiver to Turnover Rents from Rite Aid Property . (Attachments: # 1 Exhibit Exhibit A, # 2 Exhibit Exhibit B)(Sharp, Susan)

Exhibit A

Name and address of Claimant
(Please print or type):

SECURITIES AND EXCHANGE COMMISSION,
Plaintiff,

v.
ARTHUR NADEL, SCOOP CAPITAL, LLC, SCOOP
MANAGEMENT, INC.,
Defendants,
SCOOP REAL ESTATE, L.P., VALHALLA INVESTMENT
PARTNERS, L.P., VALHALLA MANAGEMENT, INC.,
VICTORY IRA FUND, LTD., VICTORY FUND, LTD.,
VIKING IRA FUND, LLC, VIKING FUND, LLC, AND
VIKING MANAGEMENT, LLC,
Relief Defendants.

Account Name: Wachovia Commercial Loan Services
Fund Name:
P. o. Box 740502
Atlanta, GA 30374-0502

I
Case Number: 8:09-CV-00087-T-26TBM
U.S. District Court Middle District of
Florida Tarn a Division
ATTENTION:
The Honorable Richard A. Lazzara of the United States District Court, Middle District of Florida, entered Orders
appointing Burton W. Wiand as Receiver of SCOOP CAPITAL, LLC; SCOOP MANAGEMENT, INC.; SCOOP REAL
ESTATE, L.P.; VALHALLA INVESTMENT PARTNERS, L.P.; VALHALLA MANAGEMENT, INC.; VICTORY FUND,
LTD.; VICTORY IRA FUND, LTD.; VIKING IRA FUND, LLC; VIKING FUND, LLC; VIKING MANAGEMENT, LLC;
VENICE JET CENTER, LLC; TRADEWIND, LLC; LAUREL MOUNTAIN PRESERVE, LLC; LAUREL PRESERVE,
LLC; THE MARGUERITE J. NADEL REVOCABLE TRUST UAD 8/2/07; THE LAUREL MOUNTAIN PRESERVE
HOMEOWNERS ASSOCIATION, INC.; THE GUY-NADEL FOUNDATION, INC.; LIME AVENUE ENTERPRISES,
LLC; A VICTORIAN GARDEN FLORIST, LLC; VIKING OIL & GAS, LLC; and HOME FRONT HOMES, LLC
(individually, "Receivership Entity," and collectively, "Receivership Entities"). On April 21, 2010, the Court issued an
Order establishing a Claim Bar Date for all claims and approving this Proof of Claim Form and the basic procedures
to administer any claims. In order to be eligible to receive a distribution from the Receivership Entities' assets, you
must complete and return this Proof of Claim Form and, if applicable, provide the requested documentation, so that
it is received on or before September 2, 2010, to Burton W. Wiand, Receiver, c/o Maya M. Lockwood, Esquire,
Wiand Guerra King P .L., 3000 Bayport Drive, Suite 600, Tampa, Florida 33607. The proper filing of this

completed claim form may entitle you to receive a distribution from the Receivership. Altered forms will not be
accepted.
The information provided in this Proof of Claim Form will be used to calculate your distribution, if any, from the
Receivership. The Receiver has the right to dispute and/or verify any information you have provided in order to
determine the proper distribution amount, if any, to which you may be entitled. The Receiver further has the right to
amend any information he may have provided as to your Net Investment Amount. By identifying and providing a
Net Investment Amount for an account the Receiver does not waive any right to (1) deny, contest the
validity of, or otherwise object to a claim or (2), if warranted, amend the provided Net Investment Amount.
IMPORTANT INFORMATION TO READ PRIOR TO SUBMITTING THIS FORM
ANY PERSON OR ENTITY SUBMITTING THIS PROOF OF CLAIM FORM SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF FLORIDA
FOR ALL PURPOSES, INCLUDING, WITHOUT LIMITATION, AS TO ANY CLAIMS, OBJECTIONS,
DEFENSES, OR COUNTERCLAIMS THAT COULD BE OR HAVE BEEN ASSERTED BY THE RECEIVER
AGAINST SUCH CLAIMANT OR THE HOLDER OF SUCH CLAIM IN CONNECTION WITH THIS
RECEIVERSHIP, INCLUDING THOSE ARISING OUT OF (1) ANY DEALING OR BUSINESS TRANSACTED
BY OR WITH ANY RECEIVERSHIP ENTITY OR (2) ANY DEALING OR BUSINESS TRANSACTED THAT
RELATES IN ANY WAY TO ANY RECEIVERSHIP PROPERTY. FURTHER, CLAIMANTS WAIVE ANY
RIGHT TO A JURY TRIAL WITH RESPECT TO SUCH CLAIMS, OBJECTIONS, DEFENSES, AND
COUNTERCLAIMS. IF THIS COMPLETED FORM, SIGNED UNDER PENALTY OF PERJURY, IS NOT
RECEIVED BY THE RECEIVER AT THE ABOVE-REFERENCED ADDRESS BY SEPTEMBER 2, 2010,
YOU WILL BE FOREVER BARRED FROM ASSERTING ANY CLAIM AGAINST THE RECEIVERSHIP
ENTITIES' ASSETS AND YOU WILL NOT BE ELIGIBLE TO RECEIVE ANY DISTRIBUTIONS FROM THE
RECEIVER.
Page 1of5

General Instructions:
You must answer each and every question. Please answer each question as fully as possible. If you
need additional space to complete an answer, please attach a separate sheet of paper and indicate the
number of the question for which you are providing the additional information. If the question does not
apply to you, please write "not applicable." Do not write "NA," "NIA" or the like. If the answer to the
question is "no" or "none," please answer as such.

1.

Full name of person completing this form. _L_in_d_sa_y_P_a_tr_ic_k_L_o_pe_z _ _ _ _ _ _ _ _ _ _ _ _ _ __
_

2.

If this form is being completed on behalf of a person or entity other than the person listed in question 1, please
provide the name of the person or entity with an interest in the Receivership Entities' assets.
Wells Fargo Bank, N.A., successor by merger to Wachovia Bank, N.A.

3.

If this form is being completed on behalf of an entity, please provide the full name of the entity and all of its
trustees, officers, directors, managing agents, shareholders, partners, beneficiaries, and any other party with
an interest in the entity.
Wells Fargo Bank, N.A., is a publicly traded company, widely owned by a large number of shareholders. Its
executive officers and directors are set forth on the attached Exhibit B.

4.

Current address and telephone number of person completing this form.
101 E. Kennedy Blvd., Suite 2700, Tampa, Florida 33602; P. 0. Box 1102, Tampa, Florida 33601
[phone]

5.

Current address and telephone number of person or entity with an interest in the Receivership Entities' assets
(if different from answer to question 4).
Wells Fargo Bank, N.A., c/o Katia Moore, Vice President/Relationship Manager,
401 Jackson St., Suite 1450, Tampa, Florida 33602 [phone]

6.

Provide .Q.ng mailing address where you (or the person/entity on whose behalf you are acting) authorize the
receipt of all future communications relating to this claim, including any possible distribution payment you may
receive. It is your responsibility to advise the Receiver of any change to this address after the submission of
this form.
101 E. Kennedy Blvd., Suite 2700, Tampa, Florida 33602

7.

Please refer to Exhibit A attached to this document. If sufficient information is available, this Exhibit provides
the following Information for the identified "account:" (1) the total amount invested; (2) the total amount
received; and (3) the Net Investment Amount. If you received funds unrelated to your investment in an
"account" (for example, incentive fees), those amounts will also appear in the attached Exhibit. Do the
amounts listed in the Exhibit accurately represent the amount of your investment into and all amounts received
from that account and any other funds you received from the Receivership Entities? Failure to respond to this
question will mean that you agree with the amounts listed in the Exhibit.
_ _ _ Yes

_ _ _ No. N/A since the Receiver elected not to specify any amounts in Exhibit A.
Page 2 of5

If you answered yes, you do not have to respond to questions 8 and 9.

8.

Please provide the following information regarding your investment in or with, or interest in, any Receivership
Entity, and attach copies of all checks, bank or other financial account statements, invoices, wire transfer
confirmations, and other documents relating to your answer:
1st investment in or with the Receivership Entities:

totaled $ 2,655.00
was made on May 23, 2005

(date);

through a check (or wire transfer) made payable to N/A
number

with

and drawn on account
(identify

financial

in~titution);

for

- - - - - - - - - - (identify the purported fund or other entity through which your investment in or
with the Receivership Entities was made).The monies were paid by Wells Fargo in connection with a closing on real

and personal property.
If applicable,

2nd

investment in or with the Receivership Entities:

totaled$ N/A

----------

was made on _ _ _ _ _ (date);
through a check (or wire transfer) made payable to - - - - - - - - - and drawn on account
number

with

(identify

financial

institution); for - - - - - - - - - - (identify the purported fund or other entity through which your
investment in or with the Receivership Entities was made).
If additional investments were made, please attach a separate sheet identifying (1) those amounts, (2) the
dates on which they were made, (3) the payee (or recipient) of the check (or wire transfer), (4) the account
number and financial institution holding the account, and (5) the purported fund or other entity through which
your investment in or with the Receivership Entities was made.
Total amount you are claiming you invested in the Receivership Entities: $_2_,6_5_5,_o_oo_.o_o _ _ __
_

9. ·

plus accrued but unpaid interest since 10/27/09 and mortgage late fees, attorneys fees & costs.

Have you ever received ankmount from a Receivership Entity, either as a distribution on your investment or
No. If yes, please provide the following information for each
for any other reason?
Yes
amount received, and attach copies of all checks, bank or other financial account statements, wire transfer
confirmations, and other documents relating to your answers.
Wells Fargo received monthly interest payments in the total amount of $681,050.22 through 10/27/09 plus late fees
Date
Amount
Payor/Payee of check/wire

A.~------­
B.~---~---

c. ________

If any additional amounts were received from any Receivership Entity, please attach a separate sheet
identifying those amounts, the dates on which they were received, and the payor and payee of the check(s) or
wire transfers.
Total amount you are claiming you received from the Receivership Entities: $_6_8_1,_05_0_.2_2_ _ _ __

1O. Was any d~BPsit into this account transferred from any other account with any Receivership Entity?
_ _ Yes JS._ No. If yes, please identify the date of any such transfer(s), the account name(s) and
Receivership Entity from which the funds were transferred, and the amount of the transfer(s).
To the best of Wells Fargo's knowledge, the answer is "no".
Page 3 of 5

11. Was your investment funded in any part with an investment in or funds received or transferred from any
"investment club" operated by Arthur Nadel, sue~ Harmony Investment Club, Indigo Investment Club, or
Traders Investment Club?
Yes _X
No.
If you answered yes, please identify with specificity the funds received or transferred, the date of any such
transfer, and the name of the investment club from which the funds originated.
Not applicable

12. Have you filed or otherwise commenced any lawsuits, arbitrations, actions, or other proceedings; or made any
demands against any person or entity, relating In any way to your investment in or with any Receivership
Entity, including against (i) financial institutions; (ii) employees, officers, directors, representatives, other
investors, or shareholders of any Receivership Entity; (iii) brokers or agents; or (iv) any other person or entity?
_ _ _ _ Yes
No. A motion will be filed with the Court seeking leave to file such a lawsuit

X

If you answered yes, please identify with specificity the nature and status of any lawsuits, arbitrations, actions,
other proceedings or demands that you have filed, made or otherwise commenced. Please include the name
of the attorney and/or firm who commenced any such proceeding or made any such demand on your behalf.
N/A

13. If you were not an Investor In a Receivership Entity, state how you claim an interest in any distribution by the
Receivership Entities (for example, if you are the beneficiary of a deceased investor, the investment was
assigned or sold to you, or you provided services or goods to the Receivership Entities for which you have not
been paid).
Wells Fargo Bank, N.A. successor by merger with Wachovia Bank, N.A. ("Wells Fargo") extended a loan to
Scoop Real Estate, L.P. ("Scoop") secured by a mortgage and security agreement on certain real and
personal property of Scoop.

14. Did you receive anything of value other than rnpl)ey from any Receivership Entity at any point in time (for
example, fax machines, shares of stock)?
X
Yes
No. If yes, please identify what you
received, from whom, and the date on which you received it.
In exchange for advancing sums reflected in the mortgage, Wells Fargo received a mortgage and security interest in
certain real and personal property of Scoop located in North Carolina.

15. Identify your primary contact person(s) at the Receivership Entitles.
Arthur Nadel

16. List any other employees or other representatives of any Receivership Entity or anyone else associated with a
Receivership Entity, including any accountant (such as Michael Zucker), lawyer (such as lawyers associated
with Holland & Knight LLP), or investment or trading representative (such as anyone associated with Shoreline
Grau , LLC with whom ou communicated or dealt.
Page 4 of 5

Craig Colburn

17. Please identify with specificity the way in which you came to learn about the Receivership Entities and
thereafter invest in or with any of them, including the person who introduced you to the Receivership Entities,
the statements made by that person, any documents provided by that person, meetings you had with the
representative(s) of the Receivership Entities, information that you relied on, and any other information.
This claim is based on loan my Wells Fargo to Scoop, secured by a mortgage and security interest in certain
real and personal property located in North Carolina. Attached as Exhibit C are the loan and security
documents. This claim is submitted without prejudice to Wells Fargo's right to foreclose on the collateral
identified in Exhibit C. Wells Fargo has a first lien security interest in all real and personal property described
in these documents, which takes priority over any claims of the trustee or any other creditor to such property.

Please submit this completed and signed, under penalty of perjury, Proof of Claim Form and legible copies of any
documentation requested in this form to Burton W. Wiand, Receiver, c/o Maya M. Lockwood., Esquire, Wiand
Guerra King P.L., 3000 Bayport Drive, Suite 600, Tampa, Florida 33607 SO THAT IT IS RECEIVED NO LATER
THAN SEPTEMBER 2, 2010.
IF YOU DO NOT AGREE WITH ANY AMOUNTS PROVIDED ON EXHIBIT A OR NO AMOUNTS WERE
PROVIDED ON EXHIBIT A, YOU MUST PROVIDE ALL DOCUMENTS OR OTHER MATERIAL THAT IS
RELATED IN ANY WAY TO YOUR INVESTMENT IN THE RECEIVERSHIP ENTITIES, OR, IF YOU ARE NOT AN
INVESTOR, TO YOUR CLAIM AGAINST A RECEIVERSHIP ENTITY, INCLUDING COPIES OF YOUR
CANCELLED CHECKS, BANK OR OTHER FINANCIAL ACCOUNT STATEMENTS SHOWING THE TRANSFER
OF FUNDS INVESTED AND RECEIVED, STATEMENTS FROM THE RECEIVERSHIP ENTITIES, WIRE
TRANSFER CONFIRMATIONS, AND ANY OTHER DOCUMENTS REGARDING YOUR CLAIM(S).

Sign, date, print your name and title, if any.

By signing below, I certify under penalty of perjury pursuant to 28 U.S.C. § 1746 which forms part of the
laws of the United States of
erica that the information provided in this form is true and correct.

Title: Attorney

Page 5 of 5

EXHIBIT "A"

EXHIBIT A

Hedge Fund Name:
Account Name:

Amount Invested:
Total Payments:
Net Investment Amount:

THE RECEIVER HAS PROVIDED THE ABOVE INFORMATION BASED UPON
DOCUMENTS AVAILABLE TO HIM. THESE FIGURES ARE BELIEVED TO BE ACCURATE
AND REASONABLE CONCLUSIONS. PLEASE CAREFULLY REVIEW THE ABOVE
AMOUNTS. IF THE NUMBERS· PROVIDED ARE NOT CONSISTENT WITH YOUR
RECORDS, IT IS YOUR OBLIGATION TO PROVIDE TRUE AND CORRECT INFORMATION
TO THE RECEIVER. IF YOU CONFIRM THAT THE ABOVE AMOUNTS ACCURATELY
REPRESENT THE AMOUNT INVESTED INTO AND ALL AMOUNTS RECEIVED FROM THE
ABOVE-NAMED ACCOUNT AND ANY OTHER FUNDS YOU RECEIVED FROM THE
RECEIVERSHIP ENTITIES, YOU ARE DOING SO UNDER PENALTY OF PERWRY.
BY IDENTIFYING AND PROVIDING THE ABOVE FIGURES, THE RECEIVER DOES NOT
WAIVEANYRIGHTTO(l)DENY,CONTESTTHEVALIDITYOF,OROUIBRWISEOBJECT
TO A CLAIM OR, (2) IF WARRANTED, AMEND ANY OF THE PROVIDED FIGURES.

Name of Investor

Hedge Fund Name/Account Name

EXHIBIT "B"

About Wells Fargo -

Executive Officers

Page 1of1

Executive Officers
For profiles of Wells Fargo executive officers, please click on the names below.
Howard I. Atkins, Senior EVP, Chief Financial Officer
Patricia R. Callahan, EVP, Office of Transition
David M. Carroll, Senior EVP, Wealth, Brokerage & Retirement Services
David A. Hoyt, Senior EVP, Wholesale Banking
Richard D. Lew, EVP, Controller
Michael J. Loughlin, EVP and Chief Credit and Risk Officer
Avid Modjtabai, EVP, Technology & Operations
Mark C. Oman, Senior EVP, Home and Consumer Finance
Kevin A. Rhein, EVP, Card Services and Consumer Lending
James M. Strother, EVP, General Counsel, Law and Government Relations
John G. Stumpf, Chairman, President and Chief Executive Officer
Carrie L. Tolstedt, Senior EVP, Community Banking

© 1999 - 2010 Wells Fargo. All rights reserved.

https ://www.wellsfargo.com/about/corporate/executive_officers/

9/2/2010

About Wells Fargo - Board of Directors

Page 1 of2

Board of Directors
For profiles of the Wells Fargo Board of Directors, please click on the names below. If you wish to get in touch with a
board member, please read How to Contact the Board of Directors.
John D. Baker II
President, CEO
Patriot Transportation Holding, Inc.

John S. Chen
Chairman, Chief Executive Officer and President
Sybase, Inc.

Lloyd H. Dean
President, CEO
Catholic Healthcare West

Susan E. Engel
Chief Executive Officer
Portera, Inc.
Enrique Hernandez, Jr.
Chairman, CEO
Inter-Con Security Systems, Inc.

Donald M. James
Chairman, CEO
Vulcan Materials Company

Richard D. McCormick
Chairman Emeritus
U S WEST, Inc.

Mackey J, McDonald
Retired Chairman
VF Corporation
Cynthia H. Milligan
Dean Emeritus, College of Business Administration
University of Nebraska - Lincoln
Nicholas G. Moore
Retired Global Chairman
PricewaterhouseCoopers
Philip J. Quigley
Retired Chairman, President, CEO
Pacific Telesis Group

httos ://www.wellsfargo.com/about/corporate/boardofdirectors/

9/2/2010

About Wells Fargo - Board of Directors

Page 2 of2

Judith M. Runstad
Of Counsel
Foster Pepper PLLC
Stephen W. Sanger
Retired Chairman
General Mills, Inc.
John G. Stumpf
Chairman, President, CEO
Wells Fargo &' Company
Susan G. Swenson
President and CEO
Sage Software, Inc.

© 1999 - 2010 Wells Fargo. All rights reserved.

https ://www.wellsfargo.com/about/corporate/boardofdirectors/

9/2/2010

EXHIBIT "C"

PROMISSORY NOTE
$2,655,000.00

May 23, 2005

Scoop Real Estate, L.P.
1618 Main Street
Sarasota, Florida 34236
(Individually and collectively "Borrower")
Wachovia Bank, National Association
214 North Hogan Street - FL0070
Jacksonville, Florida 32202
(Hereinafter referred to as "Bank")
Borrower promises to pay to the order of Bank, in lawful money of the United States of America, at its
office indicated above or wherever else Bank may specify, the sum of Two Million Six Hundred Fifty-Five
Thousand Dollars ($2,655,000.00) or such sum as may be advanced and outstanding from time to time,
with interest on the unpaid principal balance at the rate and on the terms provided in this Promissory Note
(including all renewals, extensions or modifications hereof, this "Note").
USE OF PROCEEDS. Borrower shall use the proceeds of the loan(s) evidenced by this Note for the
commercial purposes of Borrower, as follows: purchase investment property.
SECURITY. Borrower has granted Bank a security interest in the collateral described in the Loan
Documents, including, but not limited to, real and personal property collateral described in that certain
security instrument of even date herewith.
INTEREST RATE. Interest shall accrue on the unpaid princlpal balance of this Note during each Interest
Period from the date hereof at a rate per annum equal to 1-rnonth LIBOR plus 2.15% ("Interest Rate").
The Interest Rate for each Interest Period shall accrue each day during such Interest Period,
commencing on and including the first day to but excluding the last day. "Interest Period" means each
period commencing on the first day of the calendar month and ending on the first day of the next
succeeding calendar month; provided (i) the first Interest Period shall commence on the date hereof and
(ii) any Interest Period that would otherwise extend past the maturity date of this Note shall end on the
maturity date of this Note. "UBOR" means, with respect to each Interest Period, the rate for U.S. dollar
deposits with a maturity equal to the number of months specified above, as reported on Telerate page
3750 as of 11 :OO a.m., London time, on the second London business day before such Interest Period
begins, or, in the case of the first Interest Period, the second London business day before the first day of
the calendar month during which such Interest Period begins (or if not so reported, then as determined by
the Bank from another recognized source or interbank quotation).
DEFAULT RATE. In addition to all other rights contained in this Note, if a Default (as defined herein)
occurs and as long as a Default continues, all outstanding Obligations, other than Obligations under any
swap agreements (as defined in 11 U.S.C. § 101) between Borrower and Bank or its affiliates, shall bear
interest at the Interest Rate plus 3% ("Default Rate"). The Default Rate shall also apply from acceleration
until the Obligations or any judgment thereon is paid in full.
INTEREST AND FEE(S) COMPUTATION (ACTUAL/360). Interest and fees, if any, shall be computed
on the basis of a 360-day year for the actual number of days in the applicable period ("Actual/360
Computation"). The Actual/360 Computation determines the annual effective interest yield by taking the

THIS NOTE IS MADE AND EXECUTED OUTSIDE OF THE STATE OF FLORIDA, AND
THEREFORE NO FLORIDA DOCUMENTARY STAMP TAX IS DUE AND PAYABLE
HEREON.

stated (nominal) rate for a year's period and then dividing said rate by 360 to determine the daily periodic
rate to be applied for each day in the applicable period. Application of the Actual/360 Computation
produces an annualized effective rate exceeding the nominal rate.
REPAYMENT TERMS. This Note shall be due and payable in consecutive monthly payments of accrued
interest only, commencing on June 23, 2005, and continuing on the same day of each month thereafter
until fully paid. In any event, all principal and accrued interest shall be due and payable on May 23, 2007.
Borrower can prepay all or any portion of this Note without penalty.
APPLICATION OF PAYMENTS. Monies received by Bank from any source for application toward
payment of the Obligations shall be applied to accrued interest and then to principal. If a Default occurs,
monies may be applied to the Obligations in any manner or order deemed appropriate by Bank.
If any payment received by Bank under this Note or other Loan Documents is rescinded, avoided or for
any reason returned by Bank because of any adverse claim or threatened action, the returned payment
shall remain payable as an obligation of all persons liable under this Note or other Loan Documents as
though such payment had not been made.
DEFINITIONS. Loan Documents. The term "Loan Documents", as used in this Note and the other Loan
Documents, refers to all documents executed in connection with or related to the loan evidenced by this
Note and any prior notes which evidence all or any portion of the loan evidenced by this Note, and any
letters of credit issued pursuant to any loan agreement to which this Note is subject, any applications for
such letters of credit and any other documents executed in connection therewith or related thereto, and
may include, without limitation, a commitment letter that survives closing, a loan agreement, this Note,
guaranty agreements, security agreements, security instruments, financing statements, mortgage
instruments, any renewals or modifications, whenever any of the foregoing are executed, but does not
include swap agreements (as defined in 11 U.S.C. § 101). Obligations. The term "Obligations", as used
in this Note and the other Loan Documents, refers to any and all indebtedness and other obligations
under this Note, all other obligations under any other Loan Document(s), and all obligations under any
swap agreements (as defined in 11 U.S.C. § 101) between Borrower and Bank, or its affiliates, whenever
executed. Certain Other Terms. All terms that are used but not otherwise defined in any of the Loan
Documents shall have the definitions provided in the Uniform Commercial Code.
LATE CHARGE. If any payments are not timely made, Borrower shall also pay to Bank a late charge
equal to 5% of each payment past due for 10 or more days.
Acceptance by Bank of any late payment without an accompanying late charge shall not be deemed a
waiver of Bank's right to collect such late charge or to collect a late charge for any subsequent late
payment received.
If this Note is secured by owner-occupied residential real property located outside the state in which the
office of Bank first shown above is located, the late charge laws of the state where the real property is
located shall apply to this Note and the late charge shall be the highest amount allowable under such
laws. If no amount is stated thereunder, the late charge shall be 5% of each payment past due for 10 or
more days.
ATTORNEYS' FEES AND OTHER COLLECTION COSTS. Borrower shall pay all of Bank's reasonable
expenses incurred to enforce or collect any of the Obligations including, without limitation, reasonable
arbitration, paralegals', attorneys' and experts' fees and expenses, whether incurred without the
commencement of a suit, in any trial, arbitration, or administrative proceeding, or in any appellate or
bankruptcy proceeding.
USURY. If at any time the effective interest rate under this Note would, but for this paragraph, exceed the
maximum lawful rate, the effective interest rate under this Note shall be the maximum lawful rate, and any
amount received by Bank in excess of such rate shall be applied to principal and then to fees and
expenses, or, if no such amounts are owing, returned to Borrower.

Page 2

-- J

GRACE/CURE PERIOD. Grace Period. The failure of timely payment of the Obligations shall not be a
Default until 5 days after such payment is due. Cure Period. Except as provided below, any Default,
other than non-payment, may be cured within 30 days after written notice thereof is mailed to Borrower by
Bank. Borrower's right to cure shall be applicable only to curable defaults and shall not apply, without
limitation, to Defaults based upon False Warranty or Cessation; Bankruptcy. Borrower shall have the right
to cure a Default only twice during any 12 month period. Bank shall not exercise its remedies to collect
the Obligations except as Bank reasonably deems necessary to protect its interest in collateral securing
the Obligations during a cure period.
DEFAULT. If any of the following occurs and is not cured within the applicable Cure Period, a default
("Default") under this Note shall exist: Nonpayment; Nonperformance. The failure of timely payment or
performance of the Obligations or Default under this Note or any other Loan Documents. False
Warranty. A warranty or representation made or deemed made in the Loan Documents or furnished
Bank in connection with the loan evidenced by this Note proves materially false, or if of a continuing
nature, becomes materially false. Cross Default. At Bank's option, any default in payment or
performance of any obligation under any other loans, contracts or agreements of Borrower, any
Subsidiary or Affiliate of Borrower, any general partner of or the holder(s) of the majority ownership
interests of Borrower with Bank or its affiliates ("Affiliate" shall have the meaning as defined in 11 U.S.C. §
101, except that the term "Borrower" shall be substituted for the term "Debtor" therein; "Subsidiary" shall
mean any business in which Borrower holds, directly or indirectly, a controlling interest). Cessation; ·
Bankruptcy. The death of, appointment of a guardian for, dissolution of, termination of existence of, Joss
of good standing status by, appointment of a receiver for, assignment for the benefit of creditors of, or
commencement of any bankruptcy or insolvency proceeding by or against Borrower, its Subsidiaries or
Affiliates, if any, or any general partner of or the holder(s) of the majority ownership interests of Borrower,
or any party to the Loan Documents. Material Business Alteration. Without prior written consent of
Bank, a material alteration in the kind or type of Borrower's business. Material Capital Structure or
Business Alteration. Without prior written consent of Bank, (i) a material alteration in the kind or type of
Borrower's business or that of Borrower's Subsidiaries or Affiliates, if any; (ii) the sale of substantially all
of the business or assets of Borrower, any of Borrower's Subsidiaries or Affiliates or any guarantor, or a
material portion (10% or more) of such business or assets if such a sale Is outside the ordinary course of
business of Borrower, or any of Borrower's Subsidiaries or Affiliates or any guarantor, or more than 50%
of the outstanding stock or voting power of or in any such entity in a single transaction or a series of
transactions; (iii) the acquisition of substantially all of the business or assets or more than 50% of the
outstanding stock or voting power of any other entity; or (iv) should any Borrower or any of Borrower's
Subsidiaries or Affiliates or any guarantor enter into any merger or consolidation. Material Adverse
Change. Bank determines in good faith, in its sole discretion, that the prospects for payment or
performance of the Obligations are impaired or there has occurred a material adverse change in the
business or prospects of Borrower, financial or otherwise.
REMEDIES UPON DEFAULT. If a Default occurs under this Note or any Loan Documents, Bank may at
any time thereafter, take the following actions: Bank Lien. Foreclose its security interest or lien against
Borrower's accounts without notice. Acceleration Upon Default. Accelerate the maturity of this Note
and, at Bank's option, any or all other Obligations, other than Obligations under any swap agreements (as
defined in 11 U.S.C. § 101) between Borrower and Bank, or its affiliates, which shall be due in
accordance with and governed by the provisions of said swap agreements; whereupon this Note and the
accelerated Obligations shall be immediately due and payable; provided, however, if the Default is based
upon a bankruptcy or insolvency proceeding commenced by or against Borrower or any guarantor or
endorser of this Note, all Obligations (other than Obligations under any swap agreement as referenced
above) shall automatically and immediately be due and payable. Cumulative. Exercise any rights and
remedies as provided under the Note and other Loan Documents, or as provided by law or equity.
ANNUAL FINANCIAL STATEMENTS. Borrower shall deliver to Bank, within 90 days after the close of
each fiscal year, reviewed financial statements reflecting its operations during such fiscal year, including,
without limitation, a balance sheet, profit and loss statement and statement of cash ttows, with supporting
schedules and in reasonable detail, prepared in conformity with generally accepted accounting principles,

Page3

applied on a basis consistent with that of the preceding year. All such statements shall be reviewed by an
independent certified public accountant acceptable to Bank. Such statements shall be certified as to their
correctness by a principal financial officer of Borrower.
TAX ~ETURNS. Borrower shall deliver to Bank, within 30 days of filing, complete copies of federal and
state tax returns, as applicable, together with all schedules thereto, each of which shall be signed and
certified by Borrower to be true and complete copies of such returns. In the event an extension is filed,
Borrower shall deliver a copy of the extension within 30 days of filing.
FINANCIAL AND OTHER INFORMATION. Borrower shall deliver to Bank such information as Bank may
reasonably request from time to time, including without limitation, financial statements and information
pertaining to Borrower's financial condition.
FINANCIAL COVENANTS. Borrower agrees to the following provisions from the date hereof until final
payment in full of the Obligations, unless Bank shall otherwise consent in writing, using the financial
information for Borrower, its subsidiaries, affiliates and its holding or parent company, as applicable:
Maximum Leverage. Borrower's total real estate-related indebtedness (except for purchase money
mortgages) shall not exceed 50% of the Borrower's total real estate-related asset value, as determined by
Bank in its sole discretion. Liquidity Requirement. Borrower shall, at all times, maintain Liquid Assets
of not less than $5,000,000.00. "Liquid Assets" shall mean the sum of all cash, time deposits and
properly margined marketable securities.
WAIVERS AND AMENDMENTS. No waivers, amendments or modifications of this Note and other Loan
Documents shall be valid unless in writing and signed by an officer of Bank. No waiver by Bank of any
Default shall operate as a waiver of any other Default or the same Default on a future occasion. Neither
the failure nor any delay on the part of Bank in exercising any right, power, or remedy under this Note and
other Loan Documents shall operate as a waiver thereof, nor shall a single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other right, power or remedy.

Except to the extent otherwise provided by the Loan Documents or prohibited by law, each Borrower and
each other person liable under this Note waives presentment, protest, notice of dishonor, demand for
payment, notice of intention to accelerate maturity, notice of acceleration of maturity, notice of sale and all
other notices of any kind. Further, each agrees that Bank may (i) extend, modify or renew this Note or
make a novation of the loan evidenced by this Note, and/or (ii) grant releases, compromises or
indulgences with respect to any collateral securing this Note, or with respect to any Borrower or other
person liable under this Note or any other Loan Documents, all without notice to or consent of each
Borrower and other such person, and without affecting the liability of each Borrower and other such
person; provided, Bank may not extend, modify or renew this Note or make a novation of the loan
evidenced by this Note without the consent of the Borrower, or if there is more than one Borrower, without
the consent of at least one Borrower; and further provided, if there is more than one Borrower, Bank may
not enter into a modification of this Note which increases the burdens of a Borrower without the consent
of that Borrower.
MISCELLANEOUS PROVISIONS. Assignment. This Note and the other Loan Documents shall inure to
the benefit of and be binding upon the parties and their respective heirs, legal representatives, ·
successors and assigns. Bank's interests in and rights under this Note and the other Loan Documents
are freely assignable, in whole or in part, by Bank. In addition, nothing in this Note or any of the other
Loan Documents shall prohibit Bank from pledging or assigning this Note or any of the other Loan
Documents or any interest therein to any Federal Reserve Bank. Borrower shall not assign its rights and
interest hereunder without the prior written consent of Bank, and any attempt by Borrower to assign
without Bank's prior written consent is null and void. Any assignment shall not release Borrower from the
Obligations. Organization; Powers. Borrower represents that Borrower (i) is (a) an adult individual and
is sui juris, or (b) a corporation, general partnership, limited partnership, limited liability company or other
legal entity, duly organized, validly existing and in good standing under the laws of its state of
organization, and is authorized to do business in each other jurisdiction wherein its ownership of property
or conduct of business legally requires such organization (ii) has the power and authority to own its

Page4

properties and assets and to carry on its business as now being conducted and as now contemplated;
and (iii) has the power and authority to execute, deliver and perform, and by all necessary action has
authorized the execution, delivery and performance of, all of its obligations under this Note and any other
Loan Document to which it is a party. Applicable Law; Conflict Between Documents. This Note and,
unless otherwise provided in any other Loan Document, the other Loan Documents shall be governed by
and construed under the laws of the state named in Bank's address on the first page hereof without
regard to that state's conflict of laws principles. If the terms of this Note should conflict with the terms of
any loan agreement or any commitment letter that survives closing, the terms of this Note shall control.
Borrower's Accounts. Except as prohibited by law, Borrower grants Bank a security interest in all of
Borrower's accounts with Bank and any of Its affiliates. Swap Agreements. All swap agreements (as
defined in 11 U.S.C. § 101), if any, between Borrower and Bank or its affiliates are independent
agreements governed by the written provisions of said swap agreements, which will remain In full force
and effect, unaffected by any repayment, prepayment, acceleration, reduction, increase or change in the
terms of this Note, except as otherwise expressly provided in said written swap agreements, and any
payoff statement from Bank relating to this Note shall not apply to said swap agreements unless
expressly referred to in such payoff statement. Jurisdiction. Borrower irrevocably agrees to nonexclusive personal jurisdiction in the state named in Bank's address on the first page hereof.
Severabillty. If any provision of this Note or of the other Loan Documents shall be prohibited or invalid
under applicable law, such provision shall be ineffective but only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the remaining provisions of this Note or
other such document. Notices. Any notices to Borrower shall be sufficiently given, if in writing and
mailed or delivered to the Borrower's address shown above or such other address as provided hereunder,
and to Bank, if in writing and mailed or delivered to Wachovia Bank, National Association, Mail Code
VA7391, P. 0. Box 13327, Roanoke, VA 24040 or Wachovia Bank, National Association, Mail Code
VA7391, 10 South Jefferson Street, Roanoke, VA 24011 or such other address as Bank may specify in
writing from time to time. Notices to Bank must include the mail code. In the event that Borrower
changes Borrower's address at any time prior to the date the Obligations are paid in full, Borrower agrees
to promptly give written notice of said change of address by registered or certified mail, return receipt
requested, all charges prepaid. Plural; Captions. All references in the Loan Documents to Borrower,
guarantor, person, document or other nouns of reference mean both the singular and plural form, as the
case may be, and the term "person" shall mean any individual, person or entity. The captions contained
in the Loan Documents are inserted for convenience only and shall not affect the meaning or
interpretation of the Loan Documents. Advances. Bank may, in its sole discretion, make other advances
which shall be deemed to be advances under this Note, even though the stated principal amount of this
Note may be exceeded as a result thereof. Posting of Payments. All payments received during normal
banking hours after 2:00 p.m. local time at the office of Bank first shown above shall be deemed received
at the opening of the next banking day. Joint and Several Obligations. If there is more than one
Borrower, each is jointly and severally obligated. Fees and Taxes. Borrower shall promptly pay all
documentary, intangible recordation and/or similar taxes on this transaction whether assessed at closing
or arising from time to time. LIMITATION ON LIABILITY; WAIVER OF PUNITIVE DAMAGES. EACH OF
THE PARTIES HERETO, INCLUDING BANK BY ACCEPTANCE HEREOF, AGREES THAT IN ANY
JUDICIAL, MEDIATION OR ARBITRATION PROCEEDING OR ANY CLAIM OR CONTROVERSY
BETWEEN OR AMONG THEM THAT MAY ARISE OUT OF OR BE IN ANY WAY CONNECTED WITH
THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY OTHER AGREEMENT OR DOCUMENT
BETWEEN OR AMONG THEM OR THE OBLIGATIONS EVIDENCED HEREBY OR RELATED
HERETO, IN NO EVENT SHALL ANY PARTY HAVE A REMEDY OF, OR BE LIABLE TO THE OTHER
FOR, (1) INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OR (2) PUNITIVE OR EXEMPLARY
DAMAGES. EACH OF THE PARTIES HEREBY EXPRESSLY WAIVES ANY RIGHT OR CLAIM TO
PUNITIVE OR EXEMPLARY DAMAGES THEY MAY HAVE OR WHICH MAY ARISE IN THE FUTURE IN
CONNECTION WITH ANY SUCH PROCEEDING, CLAIM OR CONTROVERSY, WHETHER THE SAME
IS RESOLVED BY ARBITRATION, MEDIATION, JUDICIALLY OR OTHERWISE. Patriot Act Notice.
To help fight the funding of terrorism and money laundering activities, Federal law requires all financial
institutions to obtain, verify, and record information that identifies each person who opens an account.
For purposes of this section, account shall be understood to include loan accounts.

Page 5

WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF
BORROWER BY EXECUTION HEREOF AND BANK BY ACCEPTANCE HEREOF, KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT EACH MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS NOTE, THE LOAN DOCUMENTS OR ANY AGREEMENT CONTEMPLATED TO BE
EXECUTED IN CONNECTION WITH THIS NOTE, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY WITH
RESPECT HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT TO BANK TO ACCEPT THIS
NOTE. EACH OF THE PARTIES AGREES THAT THE TERMS HEREOF SHALL SUPERSEDE AND
REPLACE ANY PRIOR AGREEMENT RELATED TO ARBITRATION OF DISPUTES BETWEEN THE
PARTIES CONTAINED IN ANY LOAN DOCUMENT OR ANY OTHER DOCUMENT OR AGREEMENT
HERETOFORE EXECUTED IN CONNECTION WITH, RELATED TO OR BEING REPLACED,
SUPPLEMENTED, EXTENDED OR MODIFIED BY, THIS NOTE.

IN WITNESS WHEREOF, Borrower, on the day and year first above written, has caused this Note to be
executed under seal.
Scoop Real Estate, LP., a Delaware limited partnership
By: Scoop Capital, LLC, a Florida limited liability company,
its general partner

By:~
Artliur Nadel, its Manager /

STATE OF NORTH CAROLINA
COUNTY OF \±J..."lOtr)~
I,
~Jl\--Y. VJ'h~ , a Notary Public of i--\tn0t.r~ounty, State of North
Carolina, do hereby certify that Arthur Nadel personally came before me this day and acknowledged that
he is the Manager of Scoop Capital, LLC, a Florida limited liability company, general partner ("General
Partner") of SCOOP REAL ESTATE, LP., a Delaware limited partnership (the "Partnership"), and that by
authority duly given, the foregoing instrument was signed by the General Partner as its act and deed and
as the act and deed of the Partnership.
Witness my hand and notarial seal on May

:1._3, 2005.

~a~<[OFFICIAL SEAL]

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AFFIDAVIT OF RECEIPT AND ACCEPTANCE
STATE OF NORTH CAROLINA
COUNTY OF FORSYTHE
Before me this day personally appeared JON R. GOOD (the "Affiant"), who
being by me first duly sworn, deposes and says:

1.
That Affiant has been designated as a duly authorized agent of Wachovia
Bank, National Association ("Lender"), for the purpose of receiving delivery of and
accepting on behalf of Lender, that certain Promissory Note in the face amount of
$2,655,000.00, executed by SCOOP REAL ESTATE, L.P. ("Borrower") and made
payable to Lender (the "Note") and related other loan documents executed outside of
the State of Florida.

5/J.,l{:

,

2.
On
2005, Affiant, acting as a duly authorized agent of
Lender, received the Note from Borrower.
FURTHER AFFIANT SAYETH NOT.
Signature of Lender's Agent:

J~tffirL
The foregoing affidavit was sworn to before me on

f/2-~

,

2005.

My Commission Expires:

G:\JPJ\wachovia\Scoop Real Estate\Eckerd (Graham, NC)\Loan DocumentsV\ffidavit of Receipt & Acceptance.doc

agenlacc.do

S5S017 (Rev 1.0)

-------------------------------

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OUT-OF-STATE AFFIDAVIT OF EXECUTION AND DELIVERY

STATE OF NORTH CAROLINA
COUNTY OF Ht.ritl.etS::oBEFORE ME, the undersigned authority, this day personally appeared Arthur
Nadel ("Affiant"), who, being by me first duly sworn, deposes on oath and says as
follows that:
1.
Affiant is the Manager of Scoop Capital, LLC, a Florida limited liability
company, the general partner of SCOOP REAL ESTATE, LP., a Delaware limited
partnership ("Borrower"), and is authorized to provide this affidavit on behalf of
Borrower.
2.
That on the date hereof, Affiant, on behalf of the Borrower executed that
certain Promissory Note in the stated principal amount of $2,655,000.00, made payable
by Borrower to WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking
association("Lender").
3.
That the Affiant forwarded and delivered the above referenced Promissory
Note for delivery and acceptance by JON R. GOOD, in Winston-Salem, North Carolina,
for and on behalf of Lender.
Dated: May J.3

, 2005.

FURTHER AFFIANT SAITH NOT.

AR~DEL/

Sworn to and subscribed before me on May2J , 2005, by ARTHUR NADEL, who
is personally known to me or who has produced a valid driver's license as identification.

My Commission Expires:

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KEN BURKE, CLERK OF COURT
PINELLAS COUNTY FLORIDA
!
INST# 2005007905 01/06/2005 at 04:19 PM
/
/
OFF REC BK: 14049 PG: 1380-1404
DocType:MTG RECORDING: $214.00 --~ - "'

This instrument was prepared by
and should be returned to:
K. Tyler Hill, Esq., of
Hill, Ward & Henderson, P.A.
P.O. Box 223 l
Tampa, Florida 33601

M DOC STAMP: $6115.55 INT TAX: $3494.50

MORTGAGE AND SECURITY AGREEMENT

THIS MORTGAGE AND SECURJTY AGREEMENT (the "Mortgage") is made and
entered as of January 4-- , 2005, by SCOOP REAL EST ATE, L.P ., a Delaware limited
partnership ("Mortgagor"), whose address is 1618 Main Street, Sarasota, Florida 34236, for the
benefit of WACHOVIA BANK, N.A., a national banking association ("Mortgagee"), whose
address is 100 South Ashley Drive, Suite 950, Tampa, Florida 33602.

WITNESSETH:
That for diverse good and valuable considerations and to secure the payment of an
indebtedness in the aggregate sum of One Million Seven Hundred Forty Seven Thousand Two
Hundred Fifty Dollars ($1,747,250.00), or so much thereof as may be advanced, to be paid in
accordance with a Promissory Note dated the date hereof (the "Note") (which Note has a
maturity date of January _t./ 1 2006), together with interest thereon and any and all sums due or
which may become due from Mortgagor to Mortgagee, Mortgagor does grant, bargain, sell,
alien, remise, release, convey and confirm unto Mortgagee and its successors and assigns, in fee
simple, all of that certain tract of land of which Mortgagor is now seized and possessed and in
actual possession, situate in the County of Pinellas, State of Florida, which is more fully
described in Exhibit A attached hereto and made a part hereof, together with the buildings and
improvements thereon erected or to be erected (hereinafter referred to as the "Premises");

TOGETHER with:
(i)
all leasehold estate, and all right, title and interest of Mortgagor in and to all
leases or subleases covering the Premises or any portion thereof now or hereafter existing or
entered into, and all right, title and interest of Mortgagor thereunder, including, without
limitation, all cash or security deposits, advance rentals, and deposits or payments of similar
nature;
(ii)
all right, title and interest of Mortgagor in and to all options to purchase or lease
the Premises or any portion thereof or interest therein, and any greater estate in the Premises
owned or hereafter acquired;

(iii)

all easements, streets, ways, alleys, rights-of-way and rights used in connection

therewith or as a means of access thereto, and all tenements, hereditaments and appurtenances
thereof and thereto, and all water rights;
(iv) any and all buildings, structures and improvements now or hereafter erected
thereon, including, but not limited to the fixtures, attachments, appliances, equipment,
machinery, and other articles attached to said buildings, structures and improvements (sometimes
hereinafter referred to as the "Improvements");
(v)
all fixtures, appliances, machinery, equipment, furniture, furnishings and articles
of personal property now or hereafter affixed to, placed upon or used in connection with the
operation of the Premises, all gas, steam, electric, water and other heating, cooking, refrigerating,
lighting, plumbing, ventilating, irrigating and power systems, machines, appliances, fixtures, and
appurtenances which are now or may hereafter pertain or be used with, in or on the Premises
even though they may be detached or detachable and all building improvement and construction
materials, supplies and equipment hereafter de1ivered to the Premises contemplating installation
or use in any construction to be performed thereon and all rights and interests of Mortgagor in
building pennits and architectural plans and specifications relating to contemplated construction
or Improvements on the Premises and all rights and interests of Mortgagor in present or future
mortgage loan commitments pertaining to any of the Premises or Improvements thereon, except
for the personal property of any tenants occupying the Premises (sometimes hereinafter referred
to as the "Personal Property");
(vi)
all awards and proceeds of condemnation for the Premises or any part thereof to
which Mortgagor is entitled for any taking of all or any part of the Premises by condemnation or
exercise of the right of eminent domain. A11 such awards and condemnation proceeds are hereby
assigned to Mortgagee and Mortgagee is hereby authorized, subject to the provisions contained
in this Mortgage, to apply such awards and condemnation proceeds or any part thereof, after
deducting therefrom any expenses incurred by Mortgagee in the collection or handling thereof,
toward the payment, in full or in part, of the Note, notwithstanding the fact that the amount
owing thereon may not then be due and payable;
(vii) all rents, issues and profits of the Premises and all the estate, right, title and
interest of every nature whatsoever of the Mortgagor in and to the same;
(viii) all accounts (including contract rights) and general intangibles pertaining to or
arising from or in connection with all or any part of the Mortgaged Property, as hereinafter
defined, including without limitation all proceeds and choses in action arising under any
insurance policies maintained with respect to all or any part of the Mortgaged Property; and,
(ix) all proceeds, products, replacements, additions, substitutions, renewals and
accessions of any of the foregoing items.
All of the foregoing real and personal property, and all rights, privileges and franchises
thereto are collectively referred to as the "Mortgaged Property.''

2

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TO HA VE AND TO HOLD, all and singular the Mortgaged Property hereby conveyed,
and · the tenements, hereditaments and appurtenances thereunto belonging or in anywise
appertaining, and the reversion and reversions, remainder and remainders, rents, issues and
profits thereof and also all the estate, right, title, interest, property, possession, claim and demand
whatsoever as well in law as in equity of Mortgagor in and to the same and every part and parcel
thereof unto Mortgagee in fee simple.

-.

::.

PROVIDED ALWAYS, that if Mortgagor shall pay to Mortgagee any and all
indebtedness due by Mortgagor to Mortgagee (including the indebtedness evidenced by the Note
and any and all renewals of the same) and shall perfo1m, comply with and abide by each and
every stipulation, agreement, condition, and covenant of the Note and of this Mortgage; then this
Mortgage and the estate hereby created shall cease and be null and void. Provided, it is further
covenanted and agreed by the parties hereto that this Mortgage also secures the payment of and
includes all future or further advances as hereinafter set forth, to the same extent as if such made
on the date of execution of this Mortgage, and any disbursements made for the payment of tax,
levies or insurance on the Mortgaged Property, with interest on such disbursements at the
Default Rate as hereinafter defined.
To protect the security of this Mortgage, Mortgagor further covenants, warrants and
agrees with Mortgagee as follows:
ARTICLE I
COVENANTS AND AGREEMENTS OF MORTGAGOR
1.1.
Payment of Secured Obligations. Mortgagor shall pay when due the principal
of, and the interest on, the indebtedness evidenced by the Note, and the charges, fees and the
principal of, and interest on, any future advances secured by this Mortgage and shall otherwise
comply with all terms and conditions of the Note and this Mortgage.

1.2. Warranties and Representations. Mortgagor hereby covenants with Mortgagee
that Mortgagor is indefeasibly seized of the Mortgaged Property in fee simple; that the
Mortgagor has fulI power and lawful right to convey the same in fee simple as aforesaid; that it
shall be lawful for Mortgagor at all times peaceably and quietly to enter upon, hold, occupy and
enjoy said Mortgaged Property and every part thereof; that Mortgagor will make such further
assurances to perfect the lien interest in the Mortgaged Property in Mortgagee, as may
reasonably be required; and that, except for the matters described on Schedule B-2 of the
Mortgagee Title Insurance Policy issued and delivered in connection with the closing of the loan
evidenced by the Note (the "Permitted Exceptions"), Mortgagor does hereby fully warrant the
title to the Mortgaged Property and every part thereof and will defend the same against the
lawful claims of all persons whomsoever except for the Permitted Exceptions.
Mortgagor further represents and warrants to Mortgagee that alI information, reports,
paper, and data given to Mortgagee with respect to Mortgagor, and to the loan evidenced by the
Note and this Mortgage are accurate and correct in all material respects and complete insofar as
may be necessary to give Mortgagee a true and accurate knowledge of the subject matter.

3

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1.3.
Ground Leases, Leases, Subleases and Easements. Mortgagor, at Mortgagor's
sole cost and expense, shall maintain and cause to be perfonned all of the covenants, agreements,
terms, conditions and provisions on its part to be kept, observed and preformed under any ground
lease, lease, sublease or easements which may constitute a portion of or an interest in the
Mortgaged Property, shall require its tenants or subtenants to keep, observe and perform all the
covenants, agreements, terms, conditions and provisions on their part to be kept, observed or
performed under any and all ground leases, leases, subleases or easements; and shall not suffer or
permit any breach or default to occur with respect to the foregoing; and in default thereof
Mortgagee shall have the right to perfonn or to require performance of any such covenants,
agreements, terms, conditions or provisions of any such ground lease, lease, sublease or
easements and to add any expense incurred in cormection therewith to the debt secured hereby,
which such expense shall bear interest from the date of payment to the date of recovery by
Mortgagee at the Default Rate as hereinafter defined. Any such payment by Mortgagee with
interest thereon shall be immediately due and payable. The Mortgagor shall not, without the
consent of Mortgagee, consent to the modification, amendment, cancellation, termination or
surrender of any such ground lease, lease, sublease, or easement.
No release or forbearance of any Mortgagor's obligation under any such ground lease,
lease, or sublease, shall release Mortgagor from any of its obligations under this Mortgage.
1.4.
Required Insurance. Mortgagor will, at Mortgagor's sole cost and expense,
maintain or cause to be maintained with respect to the Mortgaged Property, and each part
thereof, the following insurance:
(a)
Insurance against loss or damage to the Improvements by fire and any of
the risks covered by insurance of the type now known as "all-risk" or "special form"
coverage, in an amount not less than the greater of the original amount of the Note or the
full replacement cost of the Improvements; and
(b)
Single limit comprehensive general liability insurance for not less than
$1,000,000.00 per occurrence, $2,000,000.00 general aggregate, $2,000,000.00
products/completed operations aggregate, and $1,000,000.00 personal and advertising
injury, against any claims and liability therefor to persons or property occurring on the
Mortgaged Property; and
(c)
Flood insurance, whenever the same is available and if in the opinion of
Mortgagee such protection is necessary; and
(d)
Rental loss insurance, if any lease provides for the abatement of rent, and
business interruption insurance, if any of the Mortgage Property is or will be occupied by
the Mortgagor (either type of insurance must cover debt service, real estate taxes, and
insurance premiwns for a period of at least six (6) months); and
Such other insurance, and in such amount, as may from time to time be
(e)
required by Mortgagee against the same or other hazards.

4

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All policies of insurance required by the terms of this Mortgage shall contain an
endorsement or agreement by the insurer that any loss shall be payable in accordance with the
terms of such policy notwithstanding any act or negligence of Mortgagor which might otheiwise
result in forfeiture of said insurance and the further agreement of the insurer waiving all rights of
set off, counterclaim or deductions against Mortgagor.
Mortgagor may effect for its own account any insurance not required under this Section
1.4, but any such insurance effected by Mortgagor on the Mortgaged Property, whether or not so
required, shall be for the mutual benefit of Mortgagor and Mortgagee and shall be subject to the
other provisions of this Mortgage.

1.5.
Delivery of Policies, Payment of Premiums. All policies of insurance shall be
issued by companies and in amounts satisfactory to Mortgagee. All policies of insurance shall
name Mortgagee as an additional insured, and shall have attached thereto a mortgagee's
endorsement and a lOss payment endorsement for the benefit of Mortgagee in fotm satisfactory
to Mortgagee. Mortgagor shall furnish Mortgagee with an original policy of all policies of
required insurance. If Mortgagee consents to Mortgagor providing any of the required insurance
through blanket policies carried by Mortgagor and covering more than one location, then
Mortgagor shall furnish to Mortgagee with a certificate of insurance for each such policy setting
forth the coverage, the limits of liability, the name of the carrier, the policy number, and the
expiration date (provided, however, that Mortgagee may grant or withhold its consent to any
blanket policy in its sole discretion). At least thirty (30) days prior to the expiration of each such
policy, Mo1tgagor shall furnish Mortgagee with evidence satisfactory to Mortgagee of the
payment of the required premium and the reissuance of a policy continuing insurance in force as
required by this Mortgage. All such policies shall contain a provision that such policies will not
be canceled or materially amended, which term shall include any reduction in the scope or limits
of coverage, without at least thirty (30) days prior written notice to Mortgagee. In the event
Mortgagor fails to provide, maintain, keep in force or deliver and furnish to Mortgagee the
policies of insurance required by this Section, Mortgagee may procure such insurance or singleinterest insurance for such risks covering Mortgagee's interest, and Mortgagor will pay all
premiums thereon promptly upon demand by Mortgagee, and until such payment is made by
Mortgagor the amount of all such premiums together with interest thereon at the Default Rate.

1.6. Insurance Proceeds. After the happening of any casualty to the Mortgaged
Property or any part thereof, Mortgagor shall give prompt written notice thereof to Mortgagee.
In the event of any damage to or destruction of the Mortgaged Property,
(a)
Mortgagee shall have the option in its sole discretion of applying or paying all or part of
the insurance proceeds (i) to any indebtedness secured hereby and in such order as
Mortgagee may determine, or (ii) to the restoration of the Improvements, or (iii) to
Mortgagor.

(b)
In the event of such loss or damage, all proceeds of insurance shall be
payable to Mortgagee, and Mortgagor hereby authorizes and directs any affected
insurance company to make payment of such proceeds directly to Mortgagee. Mortgagee
is hereby authorized and empowered by Mortgagor to settle, adjust or compromise any
claims for loss, damage or destruction under any policy or policies of insurance.

5

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(c)
Except to the extent that insurance proceeds are received by Mortgagee
and applied to the indebtedness secured hereby, nothing herein contained shall be deemed
to excuse Mortgagor from repairing or maintaining the Mortgaged Property as provided
in this Mortgage or restoring all damage or destruction to the Mortgaged Property,
regardless of whether or not there are insurance proceeds available or whether any such
proceeds are sufficient in amount, and the application or release by Mortgagee of any
insurance proceeds shall not cure or waive any default or notice of default under this
Mortgage or invalidate any act done pursuant to such notice.
1.7.
Assignment of Policies Upon Foreclosure. In the event of foreclosure of this
Mortgage or other transfer of title or assignment of the Mortgaged Property in extinguishment, in
whole or in part, of the debt secured hereby, all right, title and interest of the Mortgagor in and to
all policies of insurance required by this Section shall inure to the benefit of and pass to the
successor in interest to Mortgagor or the purchaser or grantee of the Mortgaged Property.
Mortgagor hereby appoints Mortgagee its attorney-in-fact to endorse any checks, drafts or other
instruments representing any proceeds of such insurance, whether payable by reason of loss
thereunder or otherwise.
1.8.
Taxes, Utilities and Impositions. Mortgagor wilJ pay, cause to be paid and
discharged, on or before the last day on which they may be paid without penalty or interest, all
such duties, taxes (including, but not limited to, ad valorem real estate taxes), sewer rents,
charges for water, or for setting or repairing of meters, and all other utilities on the Mortgaged
Property or any part thereof, and any assessments and payments, usual or unusual, extraordinary
or ordinary, which shall be imposed upon or become due and payable or become a lien upon the
Mortgage Property or any part thereof and the sidewalks or streets in front thereof and any values
therein by virtue of any present or future law of the United States or of the State, County or City
wherein the Premises are located (all of the foregoing being herein collectively called
"Impositions"). In the event of a default in the payment of any such Imposition, Mortgagee may
pay the same and the amount so paid by Mortgagee shall, at the Mortgagee's option, become
inunediately due and payable with interest at the Default Rate and shall be deemed part of the
indebtedness secured by this Mortgage.
If at any time there shall be assessed or imposed (i) a tax or assessment on the Mortgaged
Property in lieu of or in addition to the Impositions payable by Mortgagor pursuant to this
Section or (ii) a license fee, tax or assessment imposed on Mortgagee and measured by or based
in whole or part upon the amount of the outstanding obligations secured hereby, then all such
taxes, assessments or fees shall be deemed to be included within the term "Impositions" as
defined in this Section, and Mortgagor shall pay and discharge the same as herein provided with
respect to the payment of Impositions or, at the option of Mortgagee, all obligations secured
hereby, together with all accrued interest thereon, shall immediately become due and payable.
Anything to the contrary herein notwithstanding, Mortgagor shall have no obligation to pay any
franchise, estate, inheritance, income, excess profits or similar tax levied on Mortgagee or on the
obligations secured hereby.
Mortgagor will pay all mortgage recording taxes and fees payable with respect to this
Mortgage or other mortgage or transfer taxes due on account of this Mortgage or the Note
secured hereby, including but not limited to Florida documentary stamps and intangible taxes.

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Mortgagor will exhibit to Mortgagee the original receipts or other reasonably satisfactory
proof of the payment of all Impositions which may affect the Mortgaged Property or any part
thereof or the lien of the Mortgage promptly following the last date on which each Imposition is
payable hereunder.
Notwithstanding the foregoing, Mortgagor shall have the right, after prior written notice
to Mortgagee, to contest at its own expense the amount and validity of any imposition affecting
the Mortgaged Property by appropriate proceedings conducted in good faith and with due
diligence and to postpone or defer payment thereof, if and so long as:
(a)
such proceedings shall operate to suspend the collection of such
Imposition from Mortgagor or the Mortgaged Property; or
(b)
Neither the Mortgaged Property nor any part thereof would be in
hnmediate danger of being forfeited or lost by reason of such proceedjngs, postponement
or deferment; or
(c)
In the case of any Imposition affecting the Mortgaged Property which
might be or become a lien, encumbrance or charge upon or result in any forfeiture or loss
of the Mortgaged Property or any part thereof, or which might result in loss or damage to
Mortgagor or Mortgagee, Mortgagor, prior to the date such lmposition would become
delinquent, shall have furnished Mortgagee with security satisfactory to Mortgagee, and,
in the event that such security is furnished, Mortgagee shall not have the right during the
period of the contest to pay, remove or discharge the lmposition.
1.9. Maintenance, Repairs, Alterations. Mortgagor shall keep the Mortgaged
Property, or cause the same to be kept, in good condition and repair and fully protected from the
elements to the satisfaction of Mortgagee; Mortgagor shall not commit or permit to be committed
waste thereon and shall not do nor pem1it to be done any act by which the Mortgaged Property
shall become less valuable; Mortgagor will not remove, demolish or structurally alter any of the
Improvements (except such alterations as may be required by laws, ordinances or regulations)
without the prior written permission of Mortgagee; Mortgagor shall complete promptly and in
good and workmanlike manner any building or other improvement which may be constructed on
the Premises and promptly restore in like manner any Improvements which may be damaged or
destroyed thereon and will pay when due all claims for labor performed and materials furnished
therefor; Mortgagor shall use and operate, and shall require its lessees or licensees to use or
operate, the Mortgaged Property in compliance with all applicable laws, ordinances, regulations,
covenants, conditions and restrictions, and with all applicable requirements of any ground lease,
lease or sublease now or hereafter affecting the Premises or any part thereof. Unless required by
law or unless Mortgagee has otherwise agreed in writing, Mortgagor shall not allow changes in
the stated use of Mortgaged Property from that which was disclosed to Mortgagee at the time of
execution hereof. Mortgagor shall not initiate or acquiesce to a zoning change of the Mortgaged
Property without prior notice to and consent of Mortgagee. Mortgagee and its representatives
shall have access to the Mortgaged Property at all reasonable times to determine whether
Mortgagor is complying with its obligations under this Mortgage, including, but not limited to,
those set out in this Section.
7

1.10. Eminent Domain. Should the Mortgaged Property, or any part thereof or interest
therein, be taken or damaged by reason of any public use or improvement or condenmation
proceeding, or in any other manner ("Condemnation"), or should Mortgagor receive any notice
or other infonnation regarding such Condemnation, Mortgagor shall give prompt written notice
thereof to Mortgagee.
(a)
Mortgagee shall be entitled to all compensation, awards and other
payments or re1ief granted in cotmection with such Condemnation, and shall be entitled,
at its option, to commence, appear in and prosecute in its own name any action or
proceedings relating thereto. Mortgagee shall also be entitled to make any compromise
or settlement in connection with such taking or damage. All such compensation, awards,
damages, rights of action and proceeds awarded to Mortgagor (the "Proceeds") are
hereby assigned to Mortgagee and Mortgagor agrees to execute such further assigrunents
of the Proceeds as Mortgagee may require.

(b)
In the event any portion of the Mortgaged Property is so taken or
damaged, Mortgagee shall have the option in its sole and absolute discretion, to apply all
such Proceeds, after deducting therefrom all costs and expenses (regardless of the
particular nature thereof and whether incurred with or without suit), jncluding attorneys'
fees, incurred by it in connection with such Proceeds, upon any indebtedness secured
hereby, or to apply all such Proceeds, after such deductions, to the restoration of the
Such
Mortgaged Property upon such conditions as Mortgagee may detennine.
application or release shall not cure or waive any default or notice of default hereunder or
invalidate any act done pursuant to such notice.
(c)
Any amounts received by Mortgagee hereunder (after payment of any
costs in connection with obtaining same), shall, if retained by Mortgagee, be applied in
payment of any accrued interest and then in reduction of the then outstanding principal
sum of the Note, not withstanding that the same may not then be due and payable. Any
amount so applied to principal shall be applied to the payment of installments of principal
on the Note in inverse order of their due dates.

1.11. Actions by Mortgagee to Preserve the Security of this Mortgage. If
Mortgagor fails to make any payment or to do any act as and in the matmer provided for in this
Mortgage or the Note, Mortgagee, in its own discretion, without obligation so to do and without
notice to or demand upon Mortgagor and without releasing Mortgagor from any obligation, may
make or do the same in such manner and to such extent as Mortgagee may deem necessary to
protect the security hereof. Mortgagor will pay upon demand all expenses incurred or paid by
Mortgagee (including, but not limited to, attorneys' fees and court costs including those of
appellate and bankruptcy proceedings) on account of the exercise of any of the aforesaid rights
or privileges or on account of any litigation which may arise in connection with this Mortgage or
the Note or on account of any attempt, without litigation, to enforce the tenns of this Mortgage
or the Note. In case the Mortgaged Property or any part thereof shall be advertised for
foreclosure sale and not sold, Mortgagor shall pay all costs in connection therewith.
In the event that Mortgagee is called upon to pay any sums of money to protect this
Mortgage and the Note as aforesaid, all monies advanced or due hereunder shall become

8

immediately due and payable, together with interest at the Default Rate, computed from the date
of such advance to the date of the actual receipt of payment thereof by the Mortgagee. All such
monies so advanced by Mortgagee shall be deemed to be secured by this Mortgage.
1.12. Cost of Collection. In the event this Mortgage is placed in the hands of an
attorney for the collection of any sum payable hereunder, Mortgagor agrees to pay all costs of
collection, including reasonable attorneys' fees (including those in all appellate and bankruptcy
proceedings) incurred by Mortgagee, either with or without the institution of any action or
proceeding, and in addition to all costs, disbursements and allowances provided by law. All such
costs so incurred shall be deemed to be secured by this Mortgage.
1.13. Survival of Warranties. All representations, warranties and covenants of
Mortgagor contained herein or incorporated by reference shall survive funding of the loan
evidenced by the Note and shall remain continuing obligations, warranties and representations of
Mortgagor during any time when any portion of the obligations secured by this Mortgage remain
outstancting.

1.14. Additional Security. Jn the event Mortgagee at any time holds additional
security for any obligations secured hereby, it may enforce the sale thereof or otheiwise realize
upon the same, as its option, either before, concurrently herewith or after a sale is made
hereunder.
1.15. Inspections. Mortgagee, or its agents, representatives or workmen, are
authorized to enter at any reasonable time upon or on any part of the Mortgage Property for the
purpose of inspecting the same, and for the purpose of performing any of the acts it is authorized
to perfonn under the terms of this Mortgage.
1.16. Liens. Mortgagor shall pay and promptly discharge, within the lesser of thirty
(30) days after recording thereof or ten (10) days after demand by Mortgagee, at Mortgagor's

cost and expense, all liens, encumbrances and charges upon the Mortgaged Property or any part
thereof or interest therein. Notwithstanding the above, Mortgagor shall have the right to contest
in good faith the validity of any such lien, encumbrance or charge, provided Mortgagor shall first
deposit with Mortgagee a bond or other security satisfactory to Mortgagee in such amounts as
Mortgagee shall reasonably require, and provided further that Mortgagor shall thereafter
diligently proceed to cause such lien, encumbrance or charge to be removed and discharged. If
Mortgagor shall faj} to discharge any such lien, encumbrance or charge, then, in addition to any
other right or remedy of Mortgagee, Mortgagee may but shall not be obligated to, discharge the
same, either by paying the amount claimed to be due, or by procuring the discharge of such lien
by depositing in court a bond for the amount claimed or otherwise giving security for such claim,
or in such manner as is or may be prescribed by law. Any amount so paid by Mortgagee shall, at
Mortgagee's option, become immediately due and payable with interest at the Default Rate, and
shall be deemed part of the indebtedness secured by this Mortgage.
1.17. Future Advances. This Mortgage is given to secure not only existing
indebtedness, but also future advances, whether such advances are obligatory or are to be made
at the option of Mortgagee, or otherwise, as are made within (20) years from the date hereof, to
the same extent as if such future advances are made on the date of the execution of this

9

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Mortgage. The total amount of indebtedness that may be so secured may decrease to a zero
amount from time to time, or may increase from time to time, but the total unpaid balance so
secured at one time may not exceed five (5) times the face amount of the Note, plus interest
thereon, and any disbursements made for the payment of taxes, levies or insurance on the
Mortgaged Property, with interest on such disbursements at the Default Rate as hereinafter
defined.
1.18. No Limitation of Future Advance Rights. Mortgagor covenants and agrees
with Mortgagee that:
(a)
Mortgagor waives and agrees not to assert any right to limit future
advances under this Mortgage, and any such attempted limitation shall be null, void and
of no force and effect.
(b)
An event of default under this Mortgage shall automatically exist (i) if
Mortgagor executes any instrument which purports to have or would have the effect of
impahing the priority of or limiting any future advance which might ever be made under
the Mortgage or (ii) if Mortgagor takes, suffers, or permits any action or occurrence
which would adversely affect the priority of any future advance which might ever be
made under the Mortgage.
1.19. Appraisals. Mortgagor covenants and agrees that Mortgagee may obtain an
appraisal of the Mortgaged Property when required by the regulations of the Federal Reserve
Board or the Office of the Comptroller of the Currency or at such other times as the Mortgagee
may reasonably require. Such appraisals shall be performed by an independent third party
appraiser selected by tile Mortgagee. The cost of such appraiSal shall be borne by the Mortgagor.
If requested by Mortgagee, the Mortgagor shall execute an engagement letter addressed to the
appraiser selected by the Mortgagee. Mortgagor's failure or refusal to sign such an engagement
letter however shall not impair Mortgagee's right to obtain such an appraisal. Mortgagor agrees
to pay the cost of such appraisal within ten (10) days after receiving an invoice for such
appraisal.
1.20. Escrows. In order to more fully protect the security of this Mortgage and to
insure the payment of ad valorem real estate taxes, personal property taxes and insurance
premiums for all insurance applicable to the Mortgage Property, Mortgagee may require, at its
option, that Mortgagor pay to Mortgagee (in addition to any other sums due under the Note or
this Mortgage), together with each installment due under the Note, such amounts as are
necessary to enable Mortgagee to pay, at least thirty (30) days before due, all such taxes and
insurance premiums. In addition, Mortgagor shall deposit, at least thirty (30) days prior to the
due date of any such ad valorem real estate taxes, personal property taxes or insurance
premiums, such additional amounts as may be necessary to provide Mortgagee with sufficient
funds in its escrow account to pay each such item at least thirty (30) days in advance of the due
date thereof.
1.21. Transfer or Further Encumbrance of the Property. If Mortgagor shall sell,
convey, lease, assign, exchange, pledge, mortgage, hypothecate or transfer any interest in the
Mortgaged Property (it being understood that a transfer of interest in Mortgagor or a change in

10

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the present composition of the partners of Mortgagor, if Mortgagor is a partnership, or any
change in the stock ownership of Mortgagor, if Mortgagor is a corporation, or in any corporate
partner shall be and the same is deemed to be a transfer of the Mortgaged Property) without the
prior written consent of Mortgagee, which consent may be withheld in the sole and absolute
discretion of Mortgagee, the same shall constitute an event of default under this Mortgage. In
the event of any such sale, conveyance, lease, assignment, exchange, pledge, mortgage,
hypothecation or transfer for which the written consent of Mortgagee has not been first obtained,
Mortgagee shall have the right to declare all indebtedness secured by this Mortgage to be
immediately due and payable.
Mortgagor acknowledges that Mortgagee, in detennining whether or not to make the loan
secured hereby, examined the qualifications and creditworthiness of Mortgagor, found them to
be acceptable, and relied and will continue to rely upon the same as the means of repayment of
the loan. Mortgagor also acknowledges that Mortgagee evaluated the background and
experience of Mortgagor in owning and operating property such as the Mortgaged Property,
found them acceptable and relied and will continue to rely upon the same as the means of
maintaining the value of the Mortgaged Property which is Mortgagee's security for the loan.
Mortgagor acknowledges that it is a business person or entity well-experienced in borrowing
money and owning and operating property such as the Mortgaged Property, was ably represented
by licensed attorneys-at-law in the negotiation and documentation of the loan secured hereby and
bargained at arm's length, in good faith, and without duress of any kind for all of the terms and
conditions of the Note, this Mortgage and the other loan documents, including this Section.
Mortgagor further recognizes that any secondary or junior financing placed upon the Mortgaged
Property (a) may divert funds which would otherwise be used to pay the indebtedness secured
hereby; (b) could result in acceleration and foreclosure by any such junior encumbrancer which
would force Mortgagee to take measures and incur expenses to protect its security; and (c) would
impair Mortgagee's right to accept a deed in lieu of foreclosure from Mortgagor, as a foreclosure
by Mortgagee would be necessary to clear the title to the Mortgaged Property.
In accordance with the foregoing and for the purposes of (i) protecting Mortgagee's
security, both of repayment by Mortgagor and of the value ofthe Mortgaged Property; (ii) giving
Mortgagee the full benefit of its bargain and contract with Mortgagor; and (iii) keeping the
Mortgaged Property free of subordinate financing liens, Mortgagor agrees that if anything in this
Section be deemed a restraint on alienation, that it is a reasonable one and that except as
otherwise herein provided any sale, conveyance, lease, assigrnnent, exchange, pledge, mortgage,
hypothecation, further encumbrance or other transfer of title to the Mortgaged Property or any
interest therein (whether voluntary or by operation of law) without Mortgagee's prior written
consent shall be an event of default hereunder. For the purpose of illustrating, and without
limiting the generality of, the preceding sentence, the occunence at any time of any of the
following events shall be deemed to be an unpermitted transfer of title to the Mortgaged Property
and therefore an event of default hereunder:
(a)
any sale, conveyance, lease, assignment, exchange, pledge, mortgage,
hypothecation, further encumbrance or other transfer of, or the grant of a security interest
in, all or any part of the Mortgaged Property; or

11

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(b)
any sale, conveyance, assignment, exchange, pledge, mortgage,
hypothecation, encumbrance or other transfer of, or the grant of a security interest in, any
partnership interest of any partner; or
(c)

any change in the present composition of Mortgagor or its partners.

Any waiver by Mortgagee of a default by Mortgagor under this Section shall not
constitute a waiver of any right, remedy or power of Mortgagee upon a subsequent event of
default by Mortgagor under this Section, and any consent to any one sale, conveyance, lease,
assignment, exchange, pledge, mortgage, hypothecation, further encumbrance or other transfer as
hereinbefore enumerated shall not be deemed a consent to any subsequent such act.

If Mortgagor sells or transfers any of its interest in the Mortgaged Property without the
prior written consent of Mortgagee, Mortgagee or its successors and/or assigns may declare the
entire balance secured by this Mortgage immediately due and payable or, at its sole option, may
focrease the Interest Rate (as the tenn "Interest Rate" is defined in the Note) befog charged
under the Note up to the prevailing market rate at the time, and may require (i) payment of a
reasonable transfer fee and (ii) reimbursement for all expenses, legal and otherwise, incurred by
Mortgagee.
For the purpose of the foregoing paragraphs, the term "sell or transfer" shall include, in
addition to the common and ordinary meanings of those terms and without limiting their
generality, transfers made to a subsidiary or affiliated entity of Mortgagor, transfers to a
reconstituted general or limited partnership, transfers made by a partner to the individual partners
or vice-versa, transfers made by a partner to other partners or to third parties, transfers by any
corporation or its stockholders or vice-versa, any corporate merger or consolidation and transfers
made by any individual to any other individual or any entity, or vice-versa.
Notwithstanding the above, the term "sell, convey, lease, assign, exchange, pledge,
mortgage, hypothecate or transfer" the Property shall not include a sale or transfer of any
partnership interest of any general partner of the Mortgagor due to the insolvency, death, mental
incapacity or marital separation and settlement of any of the general partners of the Mortgagor.
It is expressly provided that, anything in this Section to the contrary notwithstanding, that
there shall be no secondary financing during the term of this Mortgage and no subordinate debt
instrument of any kind or other encumbrance without Mortgagee's prior written approval.

ARTICLE II
ASSIGNMENT OF LEASES, SUBLEASES
FRANCHISES, RENTS, ISSUES AND PROFITS
2.1.
Assignment of Rents. Mortgagor hereby collaterally assigns and transfers to
Mortgagee all the leases, subleases, franchises, rents, issues and profits of the Mortgaged
Property, and hereby gives to and confers upon Mortgagee the right, power and authority to
collect such rents, issues and profits as herein set forth. Mortgagor irrevocably appoints
Mortgagee its true and lawful attorney-in-fact, at the option of Mortgagee, immediately and

12

without further legal action being necessary, to demand, receive and enforce payment, to give
receipts, releases and satisfactions, and to sue, in the name of Mortgagor or Mortgagee, for all
such rents, issues and profits and apply the same to the indebtedness secured hereby; provided,
however, that Mortgagor shall have the right to collect such rents, issues and profits (but not
more than one month in advance) prior to the occurrence of an event of default or at any time
there is not ongoing an uncured event of default under this Mortgage.
2.2.
Collection Upon Default. Upon the occurrence of an event of default under this
Mortgage, Mortgagee may exercise any of the rights granted to it under Fla. Stat. Section 697.07,
and may further, at any time without notice, either in person, by agent or by receiver appoint by a
court, and without regard to the adequacy of any security for the indebtedness hereby secured,
enter upon and take possession of the Mortgaged Property, or any part thereof, in its own name,
sue for or otherwise collect such rents, issues and profits, including those past due and unpaid,
and apply the same, less costs and expenses of operation and collection, including attorneys'
fees, upon any indebtedness secured hereby, and in such order as Mortgagee may determine.
The collection of such rents, issues and profits, or the entering upon and taking possession of the
Mortgaged Property, or the application thereof as aforesaid, shall not cure or waive any default
or notice of default hereunder or invalidate any act done in response to such default or pursuant
to such notice default.
2.3.
Restriction on Further Assignments, etc. Except as hereinafter specificaJly
provided, Mortgagor shall not, without the prior written consent of the Mortgagee, assign the
rents, issues or profits, or any part thereof, from the Mortgaged Property or any part thereof; and
shall not consent to the modification, cancellation or surrender of any lease or sublease covering
the Mortgaged Property. An action of Mortgagor in violation of terms of this Section shall be
void as against Mortgagee in addition to being a default under this Mortgage.

Mortgagor shall not, without the consent of Mortgagee, consent to the cancellation or
surrender or, accept prepayment of rents, issues or profits, other than rent paid at the signing of a
lease or sublease, under any lease or sublease now or hereafter covering the Mortgaged Property
or any part thereof, nor modify any such ]ease or sublease so as to shorten the term, decrease the
rent, accelerate the payment of rent, or change the tenns of any renewal option, and any such
purported assignment, cancellation, surrender, prepayment or modification made without the
written consent of Mortgagee shall be void as against Mortgagee. Mortgagor shall, upon demand
of Mortgagee, enter into an agreement with Mortgagee with respect to the provisions contained
in the preceding provisions regarding any lease or sublease covering said Mortgaged Property or
any part thereof, and Mortgagor hereby appoints Mortgagee attorney-in-fact of Mortgagor to
execute and deliver any such agreement on behalf of Mortgagor and deliver written notice
thereof to the tenant to whose lease such agreement relates.
Mortgagor agrees to furnish to Mortgagee a copy of any modification of any lease
presently in effect and copies of all leases affecting the Mortgaged Property covered by this
Mortgage, and failure to furnish to Mortgagee a copy of any modification of a lease or a copy of
any future lease affecting said Mortgaged Property, shall be deemed a default under this
Mortgage and the Note, for which the holder of this Mortgage may, at its option, declare the
entire unpaid balance of this Mortgage and the Note to be inunediately due and payable.

13

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.

All leases or subleases hereafter entered into by Mortgagor with respect to the Mortgaged
Property or any part thereof, shall be subordinate to the lien of this Mortgage unless expressly
made superior to this Mortgage in the manner hereinafter provided. At any time or times
Mortgagee may execute and record in the appropriate Office of the County Clerk of the County
where the Premises are situated, a Notice of Subordination reciting that the lease or leases therein
described shall be superior to the lien of this Mortgage. From and after the recordation of such
Notice of Subordination, the lease or leases therein described shall be superior to the lien of this
Mortgage and shall not be extinguished by any foreclosure sale hereunder.
ARTICLE Ill
RESERVED

ARTICLE IV
SECURITY AGREEMENT
4.1.
Creation of Security Interest. Mortgagor hereby grants to Mortgagee a security
interest in any and all Personal Property included within the Mortgaged Property located on or at
the Premises, including without limitation any and all property of similar type or kind hereafter
located on or at the Premises for the purposes of securing all obligations of Mortgagor set forth
in this Mortgage. This instrument is a self-operative security agreement with respect to the
above described property, but Mortgagor agrees to execute and deliver on demand such other
security agreements, financing statements and other instruments as Mortgagee may request.
4.2.

Warranties, Representations and Covenants of Mortgagor. Mortgagor hereby

warrants, represents and covenants as follows:
(a)
Except for the security interest granted hereby, Mortgagor is, and as to
portions of the Personal Property to be acquired after the date hereof will be, the sole
owner of the Personal Property, free from any adverse lien, security interest,
encumbrance or adverse claims thereon of any kind whatsoever. Mortgagor shall notify
Mortgagee of, and shall defend the Personal Property against, all claims and demands of
all persons at any time claiming the same or any interest therein.
Mortgagor shall not lease, sell, convey or in any manner transfer the
Personal Property without the prior written consent of Mortgagee.
(b)

(c)
The Personal Property is not and shall not be used or bought for personal,
family or household purposes.
(d)
The Personal Property shall be kept on or at the Premises and Mortgagor
will not remove the Personal Property from the Premises without the prior written
consent of Mortgagee, except such portions or items of Personal Property which are
consummated or worn out in ordinary usage, all of which shall be promptly replaced by
Mortgagor.

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(e)
Mortgagor maintains a place of business in the State of Florida and
Mortgagor shall immediately notify Mortgagee in writing of any change in its place of
business as set forth in the beginning of this Mortgage.
(f)
All covenants and obligations of Mortgagor contained herein relating to
the Mortgaged Property shall be deemed to apply to the Personal Property whether or not
expressly referred to herein.
(g)
This Mortgage constitutes a "Security Agreement" as that tenn is used in
the Unifonn Commercial Code of Florida.
4.3.
Fixture Filing. This Mortgage constitutes a financing statement filed as a fixture
filing in the Official Records of the Clerk of the Circuit Court with respect to any and all
Fixtures. The "debtor" is the Mortgagor and the record owner of the Premises; the "secured
party" is the Mortgagee; the collateral is as described in this Mortgage; and the addresses of the
debtor and secured party are the addresses stated in this Mortgage for notices to such parties.
4.4.
Authorization to File. Mortgagor irrevocably authorizes Mortgagee to file, in the
appropriate locations for filings of financing statements in any jurisdiction(s) that Mortgagee in
good faith deems appropriate, such financing statements and amendments thereto as Mortgagee
may deem necessary or desirable in order to (i) perfect or continue the security interests granted
by Mortgagor to Mortgagee pursuant to this Mortgage, (ii) prevent any filed financing statement
from becoming misleading, or (iii) prevent any filed financing statement from losing its
perfected status.

ARTICLEV
REMEDIES UPON DEFAULT
5.1.
Events of Default. Any one or more of the following shall constitute a default
under this Mortgage and the Note hereby secured:
(a)
Failure of Mortgagor to make one or more payments required by the Note
on the due date thereof, without notice or demand.
(b)
Failure of Mortgagor to pay the amount of any costs, expenses or fees
(including counsel fees) of Mortgagee, with interest thereon, as required by any provision
of this Mortgage.
failure of Mortgagor to comply with or perfonu any other warranty,
(c)
covenant or agreement contained herein, in the Note, in the Loan Agreement, if any, in
the Commitment Letter dated December 10, 2004 (the "Commitment"), or in any other
document executed by Mortgagor in conjunction with this transaction within thirty (30)
days after receipt of written notice thereof by Mortgagor; provided, however, that (i) if
Mortgagor reasonably cannot perform or comply with any such obligation within such
thirty (30) day period and if, in Mortgagee's reasonable judgment, Mortgagee's security
will not be impaired, then Mortgagor may have such additional time to rectify such

15

, .

. failure as Mortgagor reasonably may require, provided and for so long as Mortgagor
proceeds with due diligence, and (ii) if, in Mortgagee's reasonable judgment,
Mortgagee's security will be impaired if Mortgagor does not perfonn or comply with any
such obligation in a period of less than thirty (30) days, Mortgagor will have only such
period (if any) following demand in which to rectify such failure as Mortgagee may
reasonably specify.
(d)
Determination by Mortgagee that any representation or warranty of
Mortgagor contained in this Mortgage, the Note, or in any other document or certificate
executed by Mortgagor in connection with this transaction was incorrect or misleading in
any material respect as of the date on which the same was made, including, without
limitation, any and all financial statements furnished by Mortgagor to Mortgagee as an
inducement to Mortgagee's making the loan evidenced by the Note or otherwise
furnished pursuant to any provision of this Mortgage, the Commitment, or any related
document.
The assertion of any federal, state, or local tax Hen, or any claim or lien for
( e)
labor or materials, or any other lien or encumbrance of any nature whatsoever (including
any judgment lien) against Mortgagor or the Mortgaged Property, and the same is not
removed by payment or transferred to substitute security in the manner provided by law
within the lesser of thirty (30) days after its recording or ten ( 10) days after demand by
Mortgagee.
(f)
The filing by Mortgagor or any guarantor of a voluntary petition in
bankruptcy, or for reorganization or for an arrangement, pursuant to the Federal
Bankruptcy Code or any similar law, federal or state, now or hereafter in effect, or the
making of an assigrunent for a benefit of creditors, or the admittance in writing of its
inability to pay its debts as they become due, or the suspension of the payment of its
obligations, or the taking of any action in furtherance of the foregoing, or the consent of
Mortgagor or any guarantor to the appointment of a receiver, trustee, liquidator, or other
similar official for Mortgagor or any guarantor or for the Mortgaged Property, or any of
them.
(g)
The filing of a petition or an answer proposing an adjudication of
Mortgagor or any guarantor as a bankrupt, or proposing Mortgagor's or any guarantor's
reorganization pursuant to the Federal Bankruptcy Code or any similar law, federal or
state, now or hereafter in effect, and the approval thereof by any court of competent
jurisdiction and the entry of an order approving the same, unless such order shall be
vacated or stayed within sixty (60) days from entry, or if Mortgagor or any guarantor
shall consent to the filing of any such petition or answer, or fail to deny the material
allegations of the same in a 6mely manner.
(h)
Death (in the case of an individual) of Mortgagor or any guarantor, or the
initiation of an action or proceeding for the dissolution, termination or liquidation of
Mortgagor or any guarantor.

16

(i)
The occurrence of an event of default under any other agreement of
Mortgagor whereby Mortgagor is obligated to repay any indebtedness, whether such
agreement obligates Mortgagor to repay such indebtedness to Mortgagee or any other
party.

G)
A determination by Mortgagee that a material adverse change has
occurred in the financial condition of Mortgagor or any guarantor since the financial
condition of Mortgagor or any guarantor was disclosed to Mortgagee in connection
herewith.
5.2.
Default Rate. The term "Default Rate", as used herein, shall mean the rate of
interest after maturity or default provided in the Note or the maximum rate permitted by Florida
law, whichever is less; provided, however, that at no time shall any interest or charges in the
nature of interest be taken, exacted, received or collected which would exceed the maximum rate
permitted by law.
5.3.
Acceleration Upon Default, Additional Remedies. In the event that one or
more defaults as above provided shall occur, the remedies available to Mortgagee shall include,
but not necessarily be limited to, any one or more of the following:
(a)
Mortgagee shall declare the entire unpaid balance of the Note, together
with any amounts outstanding hereunder, hnmediately due without notice.
(b)
Mortgagee may take immediate possession of the Mortgaged Property or
any part thereof (which Mortgagor agrees to surrender to Mortgagee) and manage,
control or lease the same to such person or pe~sons and at such rental as it may deem
proper and collect all rents, issues and profits, therefrom, including those past due as well
as those thereafter accruing, with the right in the Mortgagee to cancel any lease or
sublease for any cause which would entitle Mortgagor to cancel the same; to make such
expenditures for maintenance, repairs and costs of operation as it may deem advisable;
and after deducting the cost thereof and a commission of five (5%) percent upon the
gross amount of rents collected, to apply the residue to the payment of any sums which
are unpaid hereunder or under the Note. The taking of possession under this paragraph
shall not prevent concurrent or later proceedings for the foreclosure sale of the
Mortgaged Property as provided elsewhere herein.

(c)
Mortgagee may apply to any court of competent jurisdiction for the
appointment of a receiver or similar official to manage and operate the Mortgaged
Property, or any part thereof, and to apply the net rents and profits therefrom to the
payment of the interest and/or prindpal of the Note and/or any other obligations of
Mortgagor to Mortgagee hereunder. In event of such application, Mortgagor agrees to
consent to the appointment of such receiver or similar official, and agrees that such
receiver or similar official may be appointed without notice to Mortgagor, with regard to
the adequacy of any security for the debts and with regard to the solvency of Mortgagor
or any other person, finn or corporation who or which may be liable for the payment of
the Note or any other obligation of Mortgagor hereunder.

17

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(d)
Mortgagee may institute an action of mortgage foreclosure against the
Mortgaged Property, or take such other action at law or in equity for the enforcement of
this Mortgage and realization on the Mortgaged Property or any other security herein or
elsewhere provided for, as the law may allow, and may proceed therein to final judgment
and execution for the entire unpaid balance of the principal debt, with interest at the rate
stipulated in the Note to the date of the event of default, and thereafter at the default rate
specified in the Note, together with an other sums due by Mortgagor in accordance with
the provisions of the Note and this Mortgage, including all sums which may have been
loaned by Mortgagee to Mortgagor after the date of this Mortgage, and all sums which
may have been advanced by Mortgagee for taxes, water or sewer rents, charges or claims,
payments on prior liens, insurance, utilities or repairs to the Mortgaged Property, aU costs
of suit, together with interest at the default rate on any judgment obtained by Mortgagee
from and after the date of any judicial sale of the Mortgaged Property until actual
payment is made of the full amount due Mortgagee.
(e)
Without declaring the entire unpaid principal balance due, the Mortgagee
may foreclose only as to the sum past due, without injury to this Mortgage or the
displacement or impairment of the remainder of the lien thereof, and at such foreclosure
sale the property shall be sold subject to all remaining items of indebtedness; and
Mortgagee may again foreclose, in the same manner, as often as there may be any sum
past due.
(f)
Mortgagee may realize upon the Personal Property which is collateral
heretofore, enforce and exercise all of the Mortgagor's rights, powers, privileges and
remedies in respect of the Personal Property collateral, dispose of or otherwise deal with
the Personal Property collateral in such order as Mortgagee may in its discretion
detennine, and exercise any and all other rights, powers, privileges and remedies afforded
to a secured party under the laws of the State of Florida, as well as all other rights or
remedies available at law or in equity with regard to the Mortgaged Property collateral.
5.4.
Additional Provisions. Mortgagor expressly agrees, on behalf of itself, its
successors and assigns and any future owner of the Mortgaged Property, or any part thereof or
interest therein, as follows:
(a)
All remedies available to Mortgagee with respect to this Mortgage shall be
cumulative and may be pursued concurrently or successively. No delay by Mortgagee in
exercising any such remedy shall operate as a waiver thereof or preclude the exercise
thereof during the continuance of that or any subsequent default.
(b)
The obtaining of a judgment or decree on the Note, whether in the State of
Florida or elsewhere, shall not in any manner affect the lien of this Mortgage upon the
Mortgaged Property covered hereby, and any judgment or decree so obtained shall be
secured to the same extent as the Note is now secured.
(c)
In the event of any foreclosure sale hereunder, all net proceeds shall be
available for application to the indebtedness hereby secured whether or not such proceeds

18

..

....

may exceed the value of the Mortgaged Property for unpaid taxes, liens, assessments and
any other costs relating to the Mortgaged Property.
(d)
The only limitation upon the foregoing agreements as to the exercise of
Mortgagee's remedies is that there shall be but one full and complete satisfaction of the
indebtedness secured hereby.

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(e)
The Mortgagor shall· duly, promptly and fully perform each and every
term and provision of the Commitment, the Loan Agreement (if any), or any other
documents which have been executed and delivered by the parties hereto simultaneously
with the execution and delivery hereof, the terms of the Commitment and the Loan
Agreement (if any), being incorporated herein by reference. The lien of this Mortgage
secures the payment of all sums payable to Mortgagee and the performance of all
covenants and agreements of Mortgagor under the terms of the Commitment, the Loan
Agreement (if any), or any other document delivered herewith.
5.5.
Remedies Not Ex.elusive. Mortgagee shall be entitled to enforce payment and
performance of any indebtedness or obligations secured hereby and to exercise all rights and
powers under this Mortgage or the Note or under any 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 or trust,
pledge, lien, assignment or otherwise. Neither the acceptance of this Mortgage nor its
enforcement shall prejudice or in any manner affect Mortgagee's right to realize upon or enforce
any other security now or hereafter held by Mortgagee, it being agreed that Mortgagee shall be
entitled to enforce this Mortgage and any other security now or hereafter held by Mortgagee in
· such order and manner as Mortgagee may in its absolute discretion determine. No remedy herein
. conferred upon or reserved to Mortgagee is intended to be exclusive of any other remedy
contained herein or by law or in equity provJded or permitted, but each shall be cumulative and
shall be in addition to every other remedy given hereunder or not or hereafter existing at law or
in equity or by statute. Every power or remedy given to Mortgagee or to which it may be
otherwise entitled, may be exercised, concurrently or independently, from time to time and as
often as may be deemed expedient by Mortgagee and it may pursue inconsistent remedies.
ARTICLE VJ
MISCELLANEOUS
6.1.
Partnership Status. Mortgagor represents and warrants to Mortgagee that
Mortgagor is a limited partnership organized and existing under the laws of the State of
Delaware and has been duly and va1idly fonned. Mortgagor further warranties that it has the
power, authority and legal right to carry on the business now being conducted by it and to engage
in the transactions contemplated by the Note, this Mortgage, and any other loan documents
executed herewith, and that the execution and delivery of the Note, this Mortgage and the other
loan documents executed herewith and the performance and observance of the provisions thereof
have been duly authorized by all necessary partnership action. Mortgagor covenants and agrees
not to do anything that would cause a termination of the Partnership nor in any way adversely
affect its good standing within the State of Florida. Any and all annual filing reports and any
other reports required by the State of Delaware, the State of Florida or any other governmental

19

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entity shall be filed in a timely manner, and proof of said filing shall be furnished to Mortgagee
upon request.
6.2.
Statements by Mortgagor. Mortgagor, within three (3) days after request in
person or within ten (10) days after request by mail, will furnish to Mortgagee or any person,
firm or corporation designated by Mortgagee, a duly acknowledged written statement setting
forth the amount of the debt secured by this Mortgage, and stating either that no offsets or
defenses exist against such debt or, if such offsets or defenses are alleged to exist, full
information with respect to such alleged offsets and/or defenses.

6.3.
Successors and Assigns. The provisions hereof shall be binding upon and shall
inure to the benefit of Mortgagor, its successors and assigns, including without limitation
subsequent owners of the Mortgaged Property or any part thereof, shall be binding upon and
shall inure to the benefit of Mortgagee, its successors and assigns of any future holder of the
Note. In the event the ownership of the Mortgaged Property or any leasehold estate that may be
covered by this Mortgage, becomes vested in a person other than Mortgagor, Mortgagee may,
without notice to Mortgagor, deal with such successor or successors in interest with reference to
this instrument and the Note in the same manner as with Mortgagor, and may alter the interest
rate and/or alter or extend the terms of payment of the Note without notice to Mortgagor
hereunder or under the Note hereby secured or the lien or priority of this Mortgage with respect
to any part of the Mortgaged Property covered hereby, but nothing herein contained shall serve
to relieve Mortgagor of any liabHity under the Note or this Mortgage (or any other agreement
executed in conjunction therewith) unless Mortgagee shall expressly release Mortgagor in:
writing. Mortgagor and any transferee or assignee shall be jointly and severally liable for any
documentary stamp or intangible taxes imposed as a result of any transfer or assumption.
6.4.
Notices. All notices which are required or pennitted hereunder must be in writing
and shall be deemed to have been given, delivered or made, as the case may be (notwithstanding
lack of actual receipt by the addressee), (i) on hand delivery thereof to the recipient, (ii) seven (7)
business days after having been deposited in the United States mail, certified or registered, return
receipt requested, sufficient postage affixed and prepaid, or (iii) one (1) business day after having
been deposited with an expedited, overnight courier service (such as by way of example but not
limitation, U.S. Express Mail, Federal Express or Airborne), addressed to the party to whom
notice is inte11ded to be given at the address set forth below:
TO MORTGAGOR: Scoop Real Estate, L.P.
1618 Main Street
Sarasota, Florida 34236
TO MORTGAGEE: Wachovia Bank, N.A.
100 South Ashley Drive, Suite 950
Tampa, Florida 33602
Any party may change the address to which its notices are sent by giving the other party
written notice of any such change in the manner provided in this section, but notice of change of
address is effective only upon receipt.

20

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----------~-----------------------------------

l.

Mortgagor shall deliver to Mortgagee, promptly upon receipt of same, copies of all
notices, certificates, documents and instruments received by it which materially affect any part of
the Mortgaged Property covered hereby, including, without limitation, notices from any lessee or
sublessee claiming that Mortgagor is in default under any terms of any lease or sublease.
6.5.
Modifications in Writing. This Mortgage may not be changed, terminated or
modified orally or in any other manner than by an instrument in writing signed by the party
against whom enforcement is sought.
6.6.
Captions. The captions or headings at the beginning of each Section hereof are
for the convenience of the parties and are not a part of this Mortgage.
6.7.
Invalidity of Certain Provisions. If the lien of this Mortgage is invalid or
unenforceable as to any part of the debt, or if the lien is invalid or unenforceable as to any part of
the Mortgaged Property, the unsecured portion of the debt shall be completely paid prior to the
payments of the secured portion of the debt, and all payments made on the debt, whether
voluntary or otherwise, shall be considered to have been first paid on and applied to the full
payment of that portion of the debt which is not secured or fully secured by the lien of this
Mortgage.
6.8.
No Merger. If both the lessor's and lessee's estates under any lease or any
portion thereof which constitutes a part of the Mortgaged Property shall at any time become
vested in one owner, this Mortgage and the lien created hereby shall not be destroyed or
terminated by application of the doctrine of merger and, in such event, Mortgagee shall continue
to have and enjoy all of the rights and privileges of Mortgagee as to the separate estates. In
addition, upon the foreclosure of the lien created by this Mortgage on the Mortgaged Property
pursuant to the provisions hereof, any leases or subleases then existing and created by Mortgagor
shall not be destroyed or terminated by application of the law of merger or as a result of such
foreclosure sale shall so elect. No act by or on behalf of Mortgagee or any such purchaser sha11
constitute a termination of any lease or sublease unless Mortgagee or such purchaser shall give
written notice thereof to such tenant or subtenant.
Governing Law and Construction of Clauses. This Mortgage shall be governed
6.9.
and constmed by the laws of the State of Florida. No act of the Mortgagee shall be construed as
an election to proceed under any one provision of the Mortgage or of the applicable statutes of
the State of Florida to the exclusion of any other such provision, anything herein or otherwise to
the contrary notwithstanding.
6.10. Corrective Documentation. For and in consideration of the funding or renewal
of the indebtedness evidenced by the Note, Mortgagor further agrees to cooperate with
Mortgagee and to reexecute any and all documentation relating to the loan evidenced by the Note
and secured by this Mortgage which are deemed necessary or desirable in Mortgagee's
discretion, in order to correct or adjust any clerical errors or omissions contained in any such
document executed in connection with the loan evidenced by the Note and secured by this
Mortgage.

21

l.

6.11. Books and Records. Mortgagor will maintain books of accounts and records
reflecting Mortgagor's financial condition and the results of operations of the Mortgaged
Property in accordance with generally accepted accounting principles applied on a consistent
basis. If any of the Mortgaged Property is rented or leased, a rent schedule of the Mortgaged
Property, certified by an accounting officer of Mortgagor, showing the name of each tenant and
the space occupied, the lease expiration date and the rent payable will also be maintained by
Mortgagor. Mortgagee will have the right, from time to time at all times during normal business
hours, to examine such books, records and accounts at the offices of Mortgagor or other personal
entity maintaining such books, records and accounts and to make such copies as Mortgagee will
desire.
6.12. Financial Statements. Mortgagor will within ninety (90) days after the end of
each fiscal year, furnish to Mortgagee complete financial statements prepared in accordance with
generally accepted accounting principles applied on a consistent basis, including a profit and loss
statement, an income and expense statement, a balance sheet, a reconciliation of surplus, Federal
tax returns, and any other financial information which may be reasonably required, which
statements shall, at Mortgagee's option, be certified without qualification by audit of the certified
public accountant regularly serving Mortgagor and approved by Mortgagee. The cost of such
audit shall be paid by Mortgagor. If any of the Mortgaged Property is rented or leased,
Mortgagor will furnish to Mortgagee together with the financial statements discussed above a
rent schedule as described in Section 6.11 above. Mortgagor shall also furnish to Mortgagee
such interim statements as may reasonably be required by Mortgagee from time to time.
6.13. Other Indebtedness Secured. This Mortgage is also given as security for any
and all other sums, indebtedness> obligations and liabilities of any and every kind now or
hereafter during the tenn owing and to become due from Mortgagor to Mortgagee, however
created, incurred, evidenced, acquired or arising, whether under the Note or this Mortgage, or
any other instrument, obligation, contract, agreement or dealing of any and every kind now or
hereafter existing or entered into between Mortgagor and Mortgagee, or otherwise as amended,
modified or supplemented from time to time, and whether direct, indirect, primary, secondary,
fixed or contingent, and any and all renewals, modifications or extensions of any or all of the
foregoing.

6.14. Costs. Mortgagor shall pay all and singular the costs, charges and expenses,
including without limitation attorneys' fees, paralegals' fees, sales tax on such fees or costs, if
any (regardless of whether suit is or other proceedings are instituted, and for all arbitration,
administrative, bankruptcy and other proceedings) and abstract costs, reasonably incurred or paid
at any time by Mortgagee because of the failure of Mortgagor to perfonn, comply with, and bide
by each and every stipulation, agreement, condition and covenant of the Note, this Mortgage or
any other document executed herewith.
6.15. Waiver of Jury Trial. BY THE EXECUTION HEREOF, MORTGAGOR
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY AGREES THAT NEITHER
MORTGAGOR NOR ANY
ASSIGNEE,
SUCCESSOR,
HEIR, OR LEGAL
REPRESENTATIVE OF MORTGAGOR SHALL SEEK A JURY TRIAL IN ANY LAWSUIT,
PROCEEDING, COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE
ARISING FROM OR BASED UPON THE NOTE, THIS MORTGAGE, OR ANY OTHER

22

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LOAN DOCUMENT EVIDENCING, SECURING, OR RELATING TO THE
INDEBTEDNESS SECURED BY THIS MORTGAGE OR TO THE DEALINGS OR
RELATIONSHIP BETWEEN OR AMONG THE PARTIES HERETO.
NEITHER
MORTGAGOR NOR MORTGAGEE WILL SEEK TO CONSOLIDATE ANY SUCH
ACTION IN WHICH A JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION
IN WHICH A JURY TRIAL HAS NOT OR CANNOT BE WAIVED. THE PROVISIONS OF
THIS SECTION HAVE BEEN FULLY NEGOTIATED BY THE PARTIES HERETO, AND
THESE PROVISIONS SHALL BE SUBJECT TO NO EXCEPTION.
NEITHER
MORTGAGOR NOR MORTGAGEE HAS IN ANY WAY AGREED WITH OR
REPRESENTED TO ANY OTHER PARTY THAT THE PROVISIONS OF THIS SECTION
WILL NOT BE FULLY ENFORCED IN ALL INSTANCES. THIS PROVISION IS A
MATERIAL INDUCEMENT FOR MORTGAGEE TO ENTER INTO THIS TRANSACTION.

[Signature Page Follows]

23

IN WITNESS WHEREOF, Mortgagor has hereunto set hand and seal all done as of the

day and year first hereinbefore written.
SCOOP REAL ESTATE, L.P., a Delaware
limited partnership

By:
WITNESSES:

SCOOP CAPITAL, LLC, a Florida
limited liability company, its general

partner

By:~
Arthur Nadel, its Manager

::'.

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STATE OF FLORIDA
COUNTY OF ~N~S S~oTA-

The foregoing instrument was acknowledged before me on January '!.3_, 2005, by Arthur
Nadel, Manager of Scoop Capital, LLC, a Florida limited liability company, the general partner
of SCOOP REAL ESTATE, L.P., a Delaware limited partnership, on behalf of the limited
partnership. Such person is personally known to me or has produced a valid driver's license as
identification.

Notary Public

My Commission Expires
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DONNA BARRA
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24

EXPIRES: Oct0ber9 2008
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EXHIBIT A

Legal Description
All of Lots 12, 13, 14, and 15, and Lot 16, less the East 20 feet thereof heretofore conveyed for
road right of way purposes, all in Block 18, POWERS CENTRAL PARK SUBDIVISION,
according to the plat thereof recorded in Plat Book 10, Page 68, of the Public Records of Pinellas
County, Florida.

MODIFICATION NUMBER ONE
TO PROMISSORY NOTE
Scoop Real Estate, L.P.
161 B Main Street
Sarasota, Florida 34236
(Hereinafter referred to as "Borrower'')

N

CD

Wachovia Bank, National Association
Jacksonville, Florida 32202
(Hereinafter referred to as "Bank")

w

THIS AGREEMENT is entered into as of June 8, 2007 by and between Bank and Borrower.

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FLORIDA DOCUMENTARY STAMP TAX IN THE AMOUNT OF $2,450.00 HAS BEEN PAID OR WILL
BE PAID DIRECTLY TO THE FLORIDA DEPARTMENT OF REVENUE.
CERTIFICATE OF
REGISTRATION NO. 26-8000424554-2.

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RECITALS

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Bank is the holder of a term Promissory Note executed and delivered by Borrower, dated May 23, 2005,
in the original principal amount of $2,655,000.00 (the "Note");
Borrower and Bank have agreed to modify the terms of the Note.
In consideration of Bank's continued extension of credit and the agreements contained herein, the parties
agree as follows:
· AGREEMENT

·

ACKNOWLEDGMENT OF BALANCE. The total. outstanding unpaid principal balance under the Note as
of June 4, 2007 Is $2,655,000.00.
MODIFICATIONS.
The Note is hereby modified by deleting the provisions in the Note establishing the repayment terms and
substituting the following in their place and stead:
REPAYMENT TERMS. The Note shall be due and payable in consecutive monthly payments of accrued
interest only, commencing on June 23, 2007, and continuing on the same day of each month thereafter
until fully paid. In any event, all principal and accrued interest shall be due and payable on May 23, 2008.
ACKNOWLEDGMENTS AND REPRESENTATIONS. Borrower acknowledges and represents that the
Note and other Loan Documents, as amended hereby, are in full force and effect without any defense,
counterclaim, right or claim of set-off; that, after giving effect to this Agreement, no default or event that
With the passage of time or giving of notice would constitute a default under the Loan Documents has
occurred, all representations and warranties contained in the Loan Documents are true and correct as of
this date, all necessary action to authorize the execution and delivery of this Agreement has been taken:
and this Agreement is a modification of an existing obligation and is not a novation.
COLLATERAL. Borrower acknowledges and confirms that there have been no changes in the ownership
of any collateral pledged to secure the Obligations (the "Collateral") since the Collateral was originally
pledged; Borrower acknowledges and confirms that the Bank has existing, valid first priority security

Ill

6'10095 (Rd~ 21 0)

WPCl634674XXXX001

CFMAEXXXXX

Modugr.doc

II

interests and liens in the Collateral; and that such security interests and liens shall secure Borrower's
Obligations, including any modification of the Note or Loan Agreement, if any, and an future modifications,
extensions, renewals and/or replacements of the Loan Documents.

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MISCELLANEOUS. This Agreement shall be construed in accordance with and governed by the laws of
the applicable state as originally provided in the Loan Documents, without reference to that state's
conflicts of law principles. This Agreement and the other Loan Documents constitute the sole agreement
of the parties with respect to the subject matter thereof and supersede all oral negotiations and prior
writings with respect to the subject matter thereof. No amendment of this Agreement, and no waiver of
any one or more of the provisions hereof shall be effective unless set forth in writing and signed by the
parties hereto. The illegality, unenforceability or inconsistency of any provision of this Agreement shall
not in any way affect or impair the legality, enforceability or consistency of the remaining provisions of this
Agreement or the other Loan Documents. This Agreement and the other Loan Documents are Intended
to be consistent. However, in the event of any inconsistencies among this Agreement and any of the
Loan Documents, the terms of this Agreement, and then the Note, shall control. This Agreement may be
executed in any number of counterparts and by the different parties on separate counterparts. Each such
counterpart shall be deemed an original, but all such counterparts shall together constitute one and the
same agreement. Terms used in this Agreement which are capitalized and not otherwise defined herein
shall have the meanings ascribed to such terms in the Note. LIMITATION ON LIABILITY; WAIVER OF
PUNITIVE DAMAGES. EACH OF THE PARTIES HERETO, INCLUDING BANK BY ACCEPTANCE
HEREOF, AGREES THAT IN ANY JUDICIAL, MEDIATION OR ARBITRATION PROCEEDING OR ANY
CLAIM OR CONTROVERSY BETWEEN OR AMONG THEM THAT MAY ARISE OUT OF OR BE IN ANY
WAY CONNECTED WITH THIS AGREEMENT, THE LOAN DOCUMENTS' OR ANY OTHER
AGREEMENT OR DOCUMENT BETWEEN OR AMONG THEM OR THE OBLIGATIONS EVIDENCED
HEREBY OR RELATED HERETO, IN NO EVENT SHALL ANY PARTY HAVE A REMEDY OF, OR BE
LIABLE TO THE OTHER FOR, (1) INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OR (2)
PUNITIVE OR EXEMPLARY DAMAGES. EACH OF THE PARTIES HEREBY EXPRESSLY WAIVES
ANY RIGHT OR CLAIM TO PUNITIVE OR EXEMPLARY DAMAGES THEY MAY HAVE OR WHICH
MAY ARISE IN THE FUTURE IN CONNECTION WITH ANY SUCH PROCEEDING, CLAIM OR
CONTROVERSY, WHETHER THE SAME IS RESOLVED BY ARBITRATION, MEDIATION, JUDICIALLY
OR OTHERWISE. Final Agreement. This Agreement and the other Loan Documents represent the final
agreement between the parties and may not be contradicted by evidence of prior, contemporaneous or
subsequent agreements of the parties. There are no unwritten agreements between the parties.
DEFINITIONS. The term "Loan Documents", as used in this Agreement and the other Loan Documents,
refers to all documents, agreements. and instruments executed in connection with any of the Obligations
(as defined herein), and may include, without limitation, modification agreements, a commitment letter
that survives closing, a loan agreement, any note, guaranty agreements, security agreements, security
instruments, financing statements, mortgage instruments, letters of credit and any renewals or
modifications, whenever any of the foregoing are executed, but does not include swap agreements (as
defined in 11 U.S.C. § 101 ). The term "Obligations", as used in this Agreement and the other Loan
Documents, refers to any and all indebtedness and other obligations of every kind and description of the
Borrower to the Bank or to any Bank affiliate, whether or not under the Loan Documents, and whether
such debts or obligations are primary or secondary, direct or indirect, absolute or contingent, sole, joint or
several, secured or unsecured, due or to become due, contractual, including, without limitation, swap
agreements (as defined in 11 U.S.C. § 101 ), arising by tort, arising by operation of law, by overdraft or
otherwise, or now or hereafter existing, including, without limitation, principal, interest, fees, late fees,
expenses, attorneys' fees and costs that have been or may hereafter be contracted or Incurred.
WAIVER OF JURY TRIAL TO THE EXTENT PERMITIED BY APPLICABLE LAW, EACH OF
BORROWER BY EXECUTION HEREOF AND BANK BY ACCEPTANCE HEREOF, KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT EACH MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY AGREEMENT CONTEMPLATED TO BE

540895 (Rev 21.0)

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EXECUTED JN CONNECTION WITH THIS AGREEMENT. OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY
WITH RESPECT HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT TO BANK TO ACCEPT
THIS AGREEMENT. EACH OF THE PARTIES AGREES THAT THE TERMS HEREOF SHALL
SUPERSEDE AND REPLACE ANY PRIOR AGREEMENT RELATED TO ARBITRATION OF DISPUTES
BETWEEN THE PARTIES CONTAINED IN ANY LOAN DOCUMENT OR ANY OTHER DOCUMENT OR
AGREEMENT HERETOFORE EXECUTED IN CONNECTION WITH, RELATED TO OR BEING
REPLACED, SUPPLEMENTED, EXTENDED OR MODIFIED BY, THIS AGREEMENT.
IN WITNESS WHEREOF, the undersigned have duly signed and sealed this Agreement the day and year
first above written.

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Wachovia Bank, National Association
By:

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Katia Moore, Vice President

Tracking #: 280750
CAT ·Deal# 843552 Facility ID 634674

5-4089$ (Aev 21.0)

Page3

MoOagr.doc

MODIFICATION NUMBER TWO
TO PROMISSORY NOTE
Scoop Real Estate, L.P.
1618 Main Street
Sarasota, Florida 34236
(Hereinafter referred to as ''Borrower")
Wachovia Bank, National Association
Jacksonville, Florida 32202
(Hereinafter referred to as "Bank")
THIS AGREEMENT is entered into as of September 12, 2008 by and between Bank and Borrower.
RECITALS
Bank is the holder of a term Promissory Note, as modified by that certain Modification Number One to
Promissory Note dated June 8, 2007 and as may be modified from time to time, executed and delivered
by Borrower, dated May 23, 2005, in the original principal amount of $2,655,000.00 (the "Note");
Borrower and Bank have agreed to modify the terms of the Note.
In consideration of Bank's continued extension of credit and the agreements contained herein, the parties
agree as follows:
AGREEMENT
ACKNOWLEDGMENT OF BALANCE. The total outstanding unpaid principal balance under the Note as
of September 9, 2008 is $2,655,000.00.
MODIFICATIONS.
The Note is hereby modified by deleting the provisions in the Note establishing the repayment terms and
substituting the following in their place and stead:
REPAYMENT TERMS. The Note shall be due and payable in consecutive monthly payments of accrued
interest only, commencing on September 23, 2008, and continuing on the same day of each month
thereafter until fully paid. In any event, all principal and accrued interest shall be due and payable on May
23, 2009.
ACKNOWLEDGMENTS AND REPRESENTATIONS. Borrower acknowledges and represents that the
Note and other Loan Documents, as amended hereby, are in full force and effect without any defense,
counterclaim, right or claim of set-off; that, after giving effect to this Agreement, no default or event that
with the passage of time or giving of notice would constitute a default under the Loan Documents has
occurred, all representations and warranties contained in the Loan Documents are true and correct as of
this date, all necessary action to authorize the execution and delivery of this Agreement has been taken;
and this Agreement is a modification of an existing obligation and is not a novaUon.
COLLATERAL. Borrower acknowledges and confirms that there have been no changes in the ownership
of any collateral pledged to secure the Obligations (the "Collateral") since the Collateral was originally
pledged; Borrower acknowledges and confirms that the Bank has existing, valid first priority security
interests and lien.s In the Collateral; and that such security Interests and liens shall secure Borrower's

II

640895 (Rev 24.0J

MAE

WPCl792491 XXXX001

CFCNOTEXXX

Modeg<doc

II

.
Obligations, including any modification of the Note or Loan Agreement, if any, and all future modifications,
extensions, renewals and/or replacements of the Loan Documents.
MISCELLANEOUS. This Agreement shall be construed In accordance with and governed by the laws of
the applicable state as originally provided in the Loan Documents, without reference to that state's
conflicts of law principles. This Agreement and the other Loan Documents constitute the sole agreement
of the parties with respect to the subject matter thereof and supersede all oral negotiations and prior
writings with respect to the subject matter thereof. No amendment of this Agreement, and no waiver of
any one or more of the provisions hereof shall be effective unless set forth in writing and signed by the
parties hereto. The illegality, unenforceability or inconsistency of any provision of this Agreement shall
not in any way affect or impair the legality, enforceability or consistency of the remaining provisions of this
Agreement or the other Loan Documents. This Agreement and the other Loan Documents are intended
to be consistent. However, in the event of any inconsistencies among this Agreement and any of the
Loan Documents, the terms of this Agreement, and then the Note, shall control. This Agreement may be
executed In any number of counterparts and by the different parties on separate counterparts. Each such
counterpart shall be deemed an original, but all such counterparts shall together constitute one and the
same agreement. Terms used In this Agreement which are capitalized and not otherwise defined herein
shall have the meanings ascribed to such terms in the Note. LIMITATION ON LIABILITY; WAIVER OF
PUNITIVE DAMAGES. EACH OF THE PARTIES HERETO, INCLUDING BANK BY ACCEPTANCE
HEREOF, AGREES THAT IN ANY JUDICIAL, MEDIATION OR ARBITRATION PROCEEDING OR ANY
CLAIM OR CONTROVERSY BElWEEN OR AMONG THEM THAT MAY ARISE OUT OF OR BE IN ANY
WAY CONNECTED WITH THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY OTHER
AGREEMENT OR DOCUMENT BETWEEN OR AMONG THEM OR THE OBLIGATIONS EVIDENCED
HEREBY OR RELATED HERETO, IN NO EVENT SHALL ANY PARTY HAVE A REMEDY OF, OR BE
LIABLE TO THE OTHER FOR, (1) INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OR (2)
PUNITIVE OR EXEMPLARY DAMAGES. EACH OF THE PARTIES HEREBY EXPRESSLY WAIVES
ANY RIGHT OR CLAIM TO PUNITIVE OR EXEMPLARY DAMAGES THEY MAY HAVE OR WHICH
MAY ARISE IN THE FUTURE IN CONNECTION WITH ANY SUCH PROCEEDING, CLAIM OR
CONTROVERSY, WHETHER THE SAME IS RESOLVED BY ARBITRATION, MEDIATION, JUDICIALLY
OR OTHERWISE. Final Agreement. This Agreement and the other Loan Documents represent the final
agreement between the parties and may not be contradicted by evidence of prior, contemporaneous or
subsequent agreements of the parties. There are no unwritten agreements between the parties.
WAIVER OF JURY TRIAL. TO THE EXTENT PERMITIED BY APPLICABLE LAW, EACH OF
BORROWER BY EXECUTION HEREOF AND BANK BY ACCEPTANCE HEREOF, KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT EACH MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF. UNDER OR IN CONNECTION
WITH THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY AGREEMENT CONTEMPLATED TO BE
EXECUTED IN CONNECTION WITH THIS AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITIEN) OR ACTIONS OF ANY PARTY
WITH RESPECT HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT TO BANK TO ACCEPT
THIS AGREEMENT. EACH OF THE PARTIES AGREES THAT THE TERMS HEREOF SHALL
SUPERSEDE AND REPLACE ANY PRIOR AGREEMENT RELATED TO ARBITRATION OF DISPUTES
BETWEEN THE PARTIES CONTAINED IN ANY LOAN DOCUMENT OR ANY OTHER DOCUMENT OR
AGREEMENT HERETOFORE EXECUTED IN CONNECTION. WITH, RELATED TO OR BEING
REPLACED, SUPPLEMENTED. EXTENDED OR MODIFIED BY, THIS AGREEMENT.

540895 (Rev 2• 0)

Page2

I

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IN WITNESS WHEREOF, the undersigned have duly signed and sealed this Agreement the day and year
first above written.

Scoop Real Estate, LP.
By: Scoop Capital, LLC, General Partner

By:

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(SEAL)

Arffiefl'Nadel, Manager

Wachovia Bank, National Association
By:

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(SEAL)

Katia Moore, Vice President

Tracking#. 711077
CAT - Deal# 1002669 Facility ID 792491

~S(Rev240)

Page3

t.l<xUlgr.doc

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This instrument was prepared by
and shou Id be rehlmed to:. / /
K. Tyler Hill, Esq., of V'
Hill, Ward & Henderson, P.A.
P.O. Box 2231
Tampa, Florida 33601

Illlllll llllll Illllllllllll llllllllll lllll lllll lllll lllll lllll lllll l~ll llll llll

Doc ID:
004110900026 Type: CRP
Recorded: 05/24/2005 at 02:26:00 PM
Fee Amt: $89.00 Page 1 of 26
- Alamance, NC

( DAVID J. P , BARBER REGISTER OF DEEDS

BK

2247 PG 707-732

DEED OF TRUST AND SECURITY AGREEMENT

THIS DEED OF TRUST AND SECURITY AGREEMENT (the "Deed of Trust") is
made and entered as of May 2..4, 2005, by SCOOP REAL ESTATE, L.P., a Delaware limited
partnership ("Grantor"), whose address is 1618 Main Street, Sarasota, Florida 34236, to and in
favor of TRSTE, INC., a Virginia corporation ("Trustee"), whose address is 301 South Tryon
Street, Charlotte, North Carolina 28202, and for the benefit of the owner and holder of a
promissory note, WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking
association ("Lender"), whose address is 100 South Ashley Drive, Suite 950, Tampa, Florida
33602.
WITNESSETH:
That for diverse good and valuable considerations and to secure (i) the payment of an
indebtedness in the aggregate sum of Two Million Six Hundred Fifty-Five Thousand Dollars
($2,655,000.00), or so much thereof as may be advanced, to be paid in accordance with a
Promissory Note dated the date hereof (the "Note") (which Note has a maturity date of on or
before May 2.:3, 2007), together with interest thereon and any and all sums due or which may
become due from Grantor to Lender under the Loan Documents (as defined in the Note); (ii) the
performance of all terms, conditions and covenants set forth in the Loan Documents; (iii) the
repayment of all sums due or that may become due under or in connection with any present or
future swap agreements (as defined in 11 U .S .C. § 101) between Grantor and Lender; (iv) the
repayment of all reimbursement obligations due or that may become due under or in connection
with any present or future letters of credit issued by Lender for the account of Grantor; and (v)
all other obligations or indebtedness of Granter to Lender of whatever kind or character and
whenever borrowed or incurred, including without limitation, principal, interest, fees, late
charges and expenses, including attorneys' fees, Grantor does grant, bargain, sell, alien, remise,
release, convey and confom unto Trustee, as trustee for Lender and its successors and assigns, in
fee simple, all of that certain tract of land of which Grantor is now seized and possessed and jn

FOR LENDER USE ONLY:
SATISFACTION: The Liabilities secured by the within Deed of Trust has been satisfied in full,
this the _ _ day of
, 200_.
Signed:

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actual possession, situate in the County of Alamance, State of North Carolina, which is more
fully described in Exhibit A attached hereto and made a part hereof, together with the buildings
and improvements thereon erected or to be erected (hereinafter referred to as the "Premises");
TOGETHER with:
(i)
all leasehold estate, and all right, title and interest of Grantor in and to all leases or
subleases covering the Premises or any portion thereof now or hereafter existing or entered into,
and
right, title and interest of Grantor thereunder, including, without limitation, all cash or
security deposits, advance rentals, and deposits or payments of similar nature;

all

(ii)
all right, title and interest of Grantor in and to all options to purchase or lease the
Premises or any portion thereof or interest therein, and any gteater estate in the Premises owned
or hereafter acquired;
all easements, streets, ways, alleys, rights-of-way and rights used in connection
therewith or as a means of access thereto, and all tenements, hereditaments and appurtenances
thereof and thereto, and all water rights;
(iii)

(iv)
any and all buildings, structures and improvements now or hereafter erected
thereon, including, but not limited to the fixtures, attachments, appliances, equipment,
machinery, and other articles attached to said buildings, structures and improvements (sometimes
hereinafter referred to as the "Improvements");
(v)
all fixtures, appliances, machinery, equipment, furniture, furnishings and articles
of personal property now or hereafter affixed to, placed upon or used in connection with the
operation of the Premises, all gas, steam, electric, water and other heating, cooking, refrigerating,
lighting, plumbing, ventilating, irrjgating and power systems, machines, appliances, fixtures, and
appurtenances which are now or may hereafter pertain or be used with, in or on the Premises
even though they may be detached or detachable and all building improvement and construction
materials, supplies and equipment hereafter delivered to the Premises contemplating installation
or use in any construction to be performed thereon and all rights and interests of Granter in
building pe1mits and architectural plans and specifications relating to contemplated construction
or Improvements on the Premises and all rights and interests of Granter in present or future
mortgage loan commitments pertaining to any of the Premises or Improvements thereon, except
for the personal property of any tenants occupying the Premises (sometimes hereinafter referred
to as the "Personal Property");

(vi)
all awards and proceeds of condemnation for the Premises or any part thereof to
which Grantor is entitled for any taking of all or any part of the Premises by condemnation or
exercise of the right of eminent domain. All such awards and condemnation proceeds are hereby.
assigned to Lender and Lender is hereby authorized, subject to the provisions contained in this
Deed of Trust, to apply such awards and condemnation proceeds or any part thereof, after
deducting therefrom any expenses incurred by Lender in the collection or handling thereof,
toward the payment, in full or in part, of the Note, notwithstanding the fact that the amount
owing thereon may not then be due and payable;

2

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(vii)
all rents, issues and profits of the Premises and all the estate, right, title and
interest of every nature whatsoever of the Grantor in and to the same;
(viii) all accounts (including contract rights) and general intangibles pertaining to or
arising from or in connection with all or any part of the Property, as hereinafter defined,
including without limitation all proceeds and choses in action arising under any insurance
policies maintained with respect to all or any part of the Property; and,
(ix)
all proceeds, products, replacements, additions, substitutions, renewals and
accessions of any of the foregoing items.
All of the foregoing real and personal property, and all rights, privileges and franchises
thereto are collectively referred to as the "Property."
TO HAVE AND TO HOLD, all and singular the Property hereby conveyed, and the
tenements, hereditaments and appurtenances thereunto belonging or in anywise appertaining, and
the reversion and reversions, remainder and remainders, rents, issues and profits thereof and also
all the estate, right, title, interest, property, possession, claim and demand whatsoever as well in
law as in equity of Granter in and to the same and every part and parcel thereof unto Lender in
fee simple, forever.
IN TRUST, PROVIDED ALWAYS, that if Grantor shall pay to Lender any and all
indebtedness due by Grantor to Lender (including the indebtedness evidenced by the Note and
any and all renewals of the same) and shall perform, comply with and abide by each and every
stipulation, agreement, condition, and covenant of the Note and the Loan Documents; and any
swap agreements are complied with and abided by, then this Deed of Trust and the estate hereby
created shall cease and be null and void, and canceled of record at the request and expense of
Grantor, and if Default occurs, Trustee is authorized to foreclose and sell the Property under
power of sale or by judicial proceeding according to applicable law and as provided herein.
To protect the security of this Deed of Trust, Grantor further covenants, warrants and
agrees with Lender as follows:

ARTICLE I
COVENANTSANDAGREEMENTSOFGRANTOR
1.1.
Payment of Secured Obligations. Grantor shall pay when due the principal of,
and the interest on, the indebtedness evidenced by the Note, and the charges, fees and the
principal of, and interest on, any future advances secured by this Deed of Trust and shall
otherwise comply with all terms and conditions of the Note and this Deed of Trust.
1.2.
Warranties and Representations. Grantor hereby covenants with Lender that
Grantor is indefeasibly seized of the Property in fee simple; that the Grantor has full power and
lawful right to convey the same in fee simple as aforesaid; that it shall be lawful for Granter at
all times peaceably and quietly to enter upon, hold, occupy and enjoy said Property and every

3

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part thereof; that Granter will make such further assurances to perfect the lien interest in the
Property in Lender, as may reasonably be required; and that, except for the matters described on
Schedule B-2 of the Lender Title Insurance Policy issued and delivered in connection with the
closing of the loan evidenced by the Note (the "Permitted Exceptions"), Grantor does hereby
fully warrant the title to the Property and every part thereof and will defend the same against the
lawful claims of all persons whomsoever except for the Permitted Exceptions.
Grantor further represents and warrants to Lender that all information, reports, paper, and
data given to Lender with respect to Grantor, and to the loan evidenced by the Note and this
Deed of Trust are accurate and correct in all material respects and complete insofar as may be
necessary to give Lender a true and accurate knowledge of the subject matter.
Ground Leases, Leases, Subleases and Easements. Grantor, at Grantor's sole
1.3.
cost and expense, shall maintain and cause to be performed all of the covenants, agreements,
terms, conditions and provisions on its part to be kept, observed and preformed under any ground
lease, lease, sublease or easements which may constitute a portion of or an interest in the
Property, shall require its tenants or subtenants to keep, observe and perfonn all the covenants,
agreements, terms, conditions and provisions on their part to be kept, observed or performed
under any and all ground leases, leases, subleases or easements; and shall not suffer or permit
any breach or default to occur with respect to the foregoing; and in default thereof Lender shall
have the right to perform or to require performance of any such covenants, agreements, terms,
conditions or provisions of any such ground lease, lease, sublease or easements and to add any
expense incurred in connection therewith to the debt secured hereby, which such expense shall
bear interest from the date of payment to the date of recovery by Lender at the Default Rate as
hereinafter defined. Any such payment by Lender with interest thereon shall be immediately due
and payable. The Grantor shall not, without the consent of Lender, consent to the modification,
amendment, cancellation, termination or surrender of any such ground lease, lease, sublease, or
easement.
No release or forbearance of any Grantor's obligation under any such ground lease, lease,
or sublease, shall release Gran tor from any of its obligations under this Deed of Trust.
1.4.
Required Insurance. Grantor will, at Grantor's sole cost and expense, maintain
or cause to be maintained with respect to the Property, and each part thereof, the following
insurance:
(a)
Insurance against loss or damage to the Improvements by fire and any of
the risks covered by insurance of the type now known as "all-risk" or "special form"
coverage, in an amount not less than the greater of the original amount of the Note or the
full replacement cost of the Improvements; and
(b)
Single limit comprehensive general liability insurance for not less than
$1,000,000.00 per occurrence, $2,000,000.00 general aggregate, $2,000,000.00
products/completed operations aggregate, and $1,000,000.00 personal and advertising
injury, against any claims and liability therefor to persons or property occurring on the
Property; and

4

...
(c)
Flood insurance, whenever the same is available and if in the opinion of
Lender such protection is necessary; and
(d)
Rental loss insurance, if any lease provides for the abatement of rent, and
business interruption insurance, if any of the Mortgage Property is or will be occupied by
the Grantor (either type of insurance must cover debt service, real estate taxes, and
insurance premiums for a period of at least six (6) months); and
(e)
Such other insurance, and in such amount, as may from time to time be
required by Lender against the same or other hazards.

All policies of insurance required by the terms of this Deed of Trust shall contain an
endorsement or agreement by the insurer that any loss shall be payable in accordance with the
terms of such policy notwithstanding any act or negligence of Grantor which might otherwise
result in forfeiture of said insurance and the further agreement of the insurer waiving all rights of
set off, counterclaim or deductions against Grantor.
Grantor may·effect for its own account any insurance not required under this Section 1.4,
but any such insurance effected by Grantor on the Property, whether or not so required, shall be
for the mutual benefit of Grantor and Lender and shall be subject to the other provisions of this
Deed of Trust.
1.5.
Delivery of Policies, Payment of Premiums. All policies of insurance shall be
issued by companies and in amounts satisfactory to Lender. All policies of insurance shall name
Lender as an additional insured, and shall have attached thereto a Lender's endorsement and a
loss payment endorsement for the benefit of Lender in form satisfactory to Lender. Grantor shall
furnish Lender with an original policy of all policies of required insurance. If Lender consents to
Grantor providing any of the required insurance through blanket policies carried by Grantor and
covering more than one location, then Grantor shall furnish to Lender with a certificate of
insurance for each such policy setting forth the coverage, the limits of liability, the name of the
carrier, the policy number, and the expiration date (provided, however, that Lender may grant or
withhold its consent to any blanket policy in its sole discretion). At least thirty (30) days prior to
the expiration of each such policy, Grantor shall furnish Lender with evidence satisfactory to
Lender of the payment of the required premium and the reissuance of a policy continuing
insurance in force as required by this Deed of Trust. All such policies shall contain a provision
that such policies will not be canceled or materially amended, which term shall include any
reduction in the scope or limits of coverage, without at least thirty (30) days prior written notice
to Lender. In the event Grantor fails to provide, maintain, keep in force or deliver and furnish to
Lender the policies of insurance required by this Section, Lender may procure such insurance or
single-interest insurance for such risks covering Lender's interest, and Grantor will pay all
premiums thereon promptly upon demand by Lender, and until such payment is made by Grantor
the amount of all such premiums together with interest thereon at the Default Rate.

1.6.
Insurance Proceeds. After the happening of any casualty to the Property or any
part thereof, Grantor shall give prompt written notice thereof to Lender.

5

'.

(a)
In the event of any damage to or destruction of the Property, Lender shall
have the option in its sole discretion of applying or paying all or part of the insurance
proceeds (i) to any indebtedness secured hereby and in such order as Lender may
determine, or (ii) to the restoration of the Improvements, or (iii) to Grantor.
(b)
In the event of such loss or damage, all proceeds of insurance shall be
payable to Lender, and Grantor hereby authorizes and directs any affected insurance
company to make payment of such proceeds directly to Lender. Lender is hereby
authorized and empowered by Grantor to settle, adjust or compromise any claims for
loss, damage or destruction under any policy or policies of insurance.
(c)
Except to the extent that insurance proceeds are received by Lender and
applied to the indebtedness secured hereby, nothing herein contained shall be deemed to
excuse Grantor from repairing or maintaining the Prop'erty as provided in this Deed of
Trust or restoring all damage or destruction to the Property, regardless of whether or not
there are insurance proceeds available or whether any such proceeds are sufficient in
amount, and the application or release by Lender of any insurance proceeds shall not cure
or waive any default or notice of default under this Deed of Trust or invalidate any act
done pursuant to such notice.

1.7.
Assignment of Policies Upon Foreclosure. In the event of foreclosure of this
Deed of Trust or other transfer of title or assignment of the Property in extinguishment, in whole
or in part, of the debt secured hereby, all right, title and interest of the Grantor in and to all
policies of insurance required by this Section shall inure to the benefit of and pass to the
successor in interest to Grantor or the purchaser or grantee of the Property. Grantor hereby
appoints Lender its attorney-in-fact to endorse any checks, drafts or other instruments
representing any proceeds of such insurance, whether payable by reason of loss thereunder or
otherwise.
1.8.
Taxes, Utilities and Impositions. Grantor will pay, cause to be paid and
discharged, on or before the last day on which they may be paid without penalty or interest, all
such duties, taxes (including, but not limited to, ad valorem real estate taxes), sewer rents,
charges for water, or for setting or repairing of meters, and all other utilities on the Property or
any part thereof, and any assessments and payments, usual or unusual, extraordinary or ordinary,
which shall be imposed upon or become due and payable or become a lien upon the Mortgage
Property or any part thereof and the sidewalks or streets in front thereof and any values therein
by vhtue of any present or future law of the United States or of the State, County or City wherein
the Premises are located (a11 of the foregoing being herein collectively called ''Impositions"). In
the event of a default in the payment of any such Imposition, Lender may pay the same and the
amount so paid by Lender shall, at the Lender's option, become immediately due and payable
with interest at the Default Rate and shall be deemed part of the indebtedness secured by this
Deed of Trust.
If at any time there shall be assessed or imposed (i) a tax or assessment on the Property in
lieu of or in addition to the Impositions payable by Grantor pursuant to this Section or (ii) a
license fee, tax or assessment imposed on Lender and measured by or based in whole or part
upon the amount of the outstanding obHgat1ons secured hereby, then all such taxes, assessments

6

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''

or fees shall be deemed to be included within the term "Impositions" as defined in this Section,
and Granter shall pay and discharge the same as herein provided with respect to the payment of
Impositions or, at the option of Lender, all obligations secured hereby, together with all accrued
interest thereon, shall immediately become due and payable. Anything to the contrary herein
notwithstanding, Grantor shall have no obligation to pay any franchise, estate, inheritance,
income, excess profits or similar tax levied on Lender or on the obligations secured hereby.
:::::.t'1

b-J..

Granter will pay all mortgage recording taxes and fees payable with respect to this Deed
of Trust or other mortgage or transfer taxes due on account of this Deed of Trust or the Note
secured hereby, including but not limited to North Carolina documentary stamps and intangible
taxes.
Granter will exhibit to Lender the original receipts or other reasonably satisfactory proof
of the payment of all Impositions which may affect the Property or any part thereof or the lien of
the Deed of Trust promptly following the last date on which each Imposition is payable
hereunder.
Notwithstanding the foregoing, Grantor shall have the right, after prior written notice to
Lender, to contest at its own expense the amount and validity of any imposition affecting the
Property by appropriate proceedings conducted in good faith and with due diligence and to
postpone or defer payment thereof, if and so long as:
(a)
such proceedings shall operate to suspend the collection of such
Imposition from Grantor or the Property; or
(b)
Neither the Property nor any part thereof would be in immediate danger of
being forfeited or lost by reason of such proceedings, postponement or deferment; or
In the case of any Imposition affecting the Property which might be or
(c)
become a lien, encumbrance or charge upon or result in any forfeiture or loss of the
Property or any part thereof, or which might result in loss or damage to Grantor or
Lender, Grantor, prior to the date such Imposition would become delinquent, shall have
furnished Lender with security satisfactory to Lender, and, in the event that such security
is furnished, Lender shall not have the right during the period of the contest to pay,
remove or discharge the Imposition.

1.9.
Maintenance, Repairs, Alterations. Grantor shall keep the Property, or cause
the same to be kept, in good condition and repair and fully protected from the elements to the
satisfaction of Lender; Granter shall not commit or permit to be committed waste thereon and
shall not do nor permit to be done any act by which the Property shall become less valuable;
Grantor will not remove, demolish or structurally alter any of the Improvements (except such
alterations as may be required by laws, ordinances or regulations) without the prior written
permission of Lender; Granter shall complete promptly and in good and workmanlike manner
any building or other improvement which may be constructed on the Premises and promptly
restore in like manner any Improvements which may be damaged or destroyed thereon and will
pay when due all claims for labor performed and materials furnished therefor; Granter shall use
and operate, and shall require its lessees or licensees to use or operate, the Property in

7

compliance with all applicable laws, ordinances, regulations, covenants, conditions and
restrictions, and with all applicable requirements of any ground lease, lease or sublease now or
hereafter affecting the Premises or any part thereof. Unless required by law or unless Lender has
otherwise agreed in writing, Grantor shall not allow changes in the stated use of Property from
that which was disclosed to Lender at the time of execution hereof. Grantor shall not initiate or
acquiesce to a zoning change of the Prope1ty without prior notice to and consent of Lender.
Lender and its representatives shall have access to the Property at all reasonable times to
determine whether Grantor is complying with its obligations under this Deed of Trust, including,
but not limited to, those set out in this Section.
1.10. Eminent Domain. Should the Property, or any part thereof or interest therein, be
taken or damaged by reason of any public use or improvement or condemnation proceeding, or
in any other manner ("Condemnation''), or should Grantor receive any notice or other
information regarding such Condemnation, Granter shall give prompt written notice thereof to
Lender.
(a)
Lender shall be entitled to all compensation, awards and other payments or
relief granted in connection with such Condemnation, and shall be entitled, at its option,
to commence, appear in and prosecute in its own name any action or proceedings relating
thereto. Lender shall also be entitled to make any compromise or settlement in
connection with such taking or damage. All such compensation, awards, damages, rights
of action and proceeds awarded to Grantor (the "Proceeds") are hereby assigned to
Lender and Orantor agrees to execute such further assignments of the Proceeds as Lender
may require.
(b)
In the event any portion of the Property is so taken or damaged, Lender
shall have the option in its sole and absolute discretion, to apply all such Proceeds, after
deducting therefrom all costs and expenses (regardless of the particular nature thereof and
whether incurred with or without suit), including attorneys' fees, incurred by it in
connection with such Proceeds, upon any indebtedness secured hereby, or to apply all .
such Proceeds, after such deductions, to the restoration of the Property upon such
conditions as Lender may determine. Such application or release shall not cure or waive
any default or notice of default hereunder or invalidate any act done pursuant to such
notice.
(c)
Any amounts received by Lender hereunder (after payment of any costs in
connection with obtaining same), shall, if retained by Lender, be applied in payment of
any accrued interest and then in reduction of the then outstanding principal sum of the
Note, not withstanding that the same may not then be due and payable. Any amount so
applied to principal shall be applied to the payment of installments of principal on the
Note in inverse order of their due dates.
1.11. Actions by Lender to Preserve the Security of this Deed of Trust. If Grantor
fails to make any payment or to do any act as and in the manner provided for in this Deed of
Trust or the Note, Lender, in its own discretion, without obligation so to do and without notice to
or demand upon Grantor and without releasing Grantor from any obligation, may make or do the
same in such manner and to such extent as Lender may deem necessary to protect the security

8

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hereof. Granter will pay upon demand all expenses incurred or paid by Lender (including, but
not limited to, attorneys' fees and court costs including those of appellate and bankruptcy
proceedings) on account of the exercise of any of the aforesaid rights or privileges or on account
of any litigation which may arise in cormection with this Deed of Trust or the Note or on account
of any attempt, without litigation, to enforce the terms of this Deed of Trust or the Note. In case
the Property or any part thereof shall be advertised for foreclosure sale and not sold, Granter
shall pay all costs in connection therewith.

1n the event that Lender is called upon to pay any sums of money to protect this Deed of
Trust and the Note as aforesaid, all monies advanced or due hereunder shall become immediately
due and payable, together with interest at the Default Rate, computed from the date of such
advance to the date of the actual receipt of payment thereof by the Lender. All such monies so
advanced by Lender shall be deemed to be seclired by this Deed of Trust.
1.12. Cost of Collection. In the event this Deed of Trust is placed in the hands of an
attorney for the collection of any sum payable hereunder, Grantor agrees to pay all costs of
collection, including reasonable attorneys' fees (including those in all appellate and bankruptcy
proceedings) incurred by Lender, either with or without the institution of any action or
proceeding, and in addition to all costs, disbursements and allowances provided by law. All such
costs so incurred shall be deemed to be secured by this Deed of Trust.

1.13. Survival of Warranties. All representations, warranties and covenants of
Grantor contained herein or incorporated by reference shall survive funding of the loan
evidenced by the Note and shall remain continuing obligations, warranties and representations of
Grantor during any time when any portion of the obligations secured by this Deed of Trust
remain outstanding.
1.14. Additional Security. In the event Lender at any time holds additional security
for any obligations secured hereby, it may enforce the sale thereof or otherwise realize upon the
same, as its option, either before, concurrently herewith or after a sale is made hereunder.
Inspections. Lender, or its agents, representatives or workmen, are authorized to
enter at any reasonable time upon or on any part of the Mortgage Property for the purpose of
inspecting the same, and for the purpose of performing any of the acts it is authorized to perform
under the terms of this Deed of Trust.
1.15.

1.16. Liens. Granter shall pay and promptly discharge, within the lesser of thirty (30)
days after recording thereof or ten (10) days after demand by Lender, at Grantor's cost and
expense, all liens, encumbrances and charges upon the Property or any part thereof or interest
therein. Notwithstanding the above, Granter shall have the right to contest in good faith the
validity of any such lien, encumbrance or charge, provided Granter shall first deposit with
Lender a bond or other security satisfactory to Lender in such amounts as Lender shall
reasonably require, and provided further that Grantor shall thereafter diligently proceed to cause
such lien, encumbrance or charge to be removed and discharged. If Granter shall fail to
discharge any such lien, encumbrance or charge, then, in addition to any other right or remedy of
Lender, Lender may but shall not be obligated to, discharge the same, either by paying the
amount claimed to be due, or by procuring the discharge of such lien by depositing in court a

9

bond for the amount claimed or otherwise giving security for such claim, or in such manner as is
or may be prescribed by law. Any amount so paid by Lender shall, at Lender's option, become
immediately due and payable with interest at the Default Rate, and shall be deemed part of the
indebtedness secured by this Deed of Trust.

1.17. Future Advances. This Deed of Trust is given to secure not only existing
indebtedness, but also future advances, whether such advances are obligatory or are to be made
at the option of Lender, or otherwise, as are made within fifteen (15) years from the date hereof,
to the same extent as if such future advances are made on the date of the execution of this Deed
of Trust. The total amount of indebtedness initially secured hereunder is Two Million Six
Hundred Fifty-Five Thousand Dollars ($2,655,000.00), and the total amount of indebtedness that
may be so secured may decrease to a zero amount from time to time, or may increase from time
to time, but the total unpaid balance so secured at one time may not exceed Ten Million Dollars
($10,000,000.00), plus interest thereon, and any disbursements made for the payment of taxes,
levies or insurance on the Property, with interest on such disbursements at the Default Rate as
hereinafter defined.
1.18.
Lender that:

No Limitation of Future Advance Rights. Grantor covenants and agrees with

(a)
Grantor waives and agrees not to assert any right to limit future advances
lUlder this Deed of Trust, and any such attempted limitation shall be null, void and of no
force and effect.
(b)
An event of default under this Deed of Trust shall automatically exist (i) if
Grantor executes any instrument which purports to have or wou1d have the effect of
impairing the priority of or limiting any future advance which might ever be made under
the Deed of Trust or (ii) if Grantor takes 1 suffers, or permits any action or occurrence
which would adversely affect the priority of any future advance which might ever be
made under the Deed of Trust.

1.19. Appraisals. Grantor covenants and agrees that Lender may obtain an appraisal of
the Property when required by the regulations of the Federal Reserve Board or the Office of the
Comptroller of the Currency or at such other times as the Lender may reasonably require. Such
appraisals shall be performed by an independent third party appraiser selected by the Lender.
The cost of such appraisal shall be borne by the Grantor. If requested by Lender, the Grantor
shall execute an engagement letter addressed to the appraiser selected by the Lender. Grantor's
failure or refusal to sign such an engagement letter however shall not impair Lender's right to
obtain such an appraisal. Grantor agrees to pay the cost of such appraisal within ten (10) days
after receiving an invoice for such appraisal.

1.20. Escrows. In order to more fully protect the security of this Deed of Trust and to
insure the payment of ad valorem real estate taxes, personal property taxes and insurance
premiums for all insurance applicable to the Mortgage Property, Lender may require, at its
option, that Granter pay to Lender (in addition to any other sums due under the Note or this Deed
of Trust), together with each installment due under the Note, such amounts as are necessary to
enable Lender to pay, at least thirty (30) days before due, all such taxes and insurance premiums.

10

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In addition, Grantor shall deposit, at least thirty (30) days prior to the due date of any such ad
valorem real estate taxes, ·personal property taxes or insurance premiums, such additional
amounts as may be necessary to provide Lender with sufficient funds in its escrow account to
pay each such item at least thirty (30) days in advance of the due date thereof.

1.21. Transfer or Further Encumbrance of the Property. If Grantor shall sell,
convey, lease, assign, exchange, pledge, mortgage, hypothecate or transfer any interest in the
Property (it being understood that a transfer of interest in Grantor or a change in the present
composition of the partners of Grantor, if Grantor is a partnership, or any change in the stock
ownership of Granter, if Grantor is a corporation, or in any corporate partner shall be and the
same is deemed to be a transfer of the Property) without the prior written consent of Lender,
which consent may be withheld in the sole and absolute discretion of Lender, the same shall
constitute an event of default under this Deed of Trust. In the event of any such sale,
conveyance; lease, assignment, exchange, pledge, mortgage, hypothecation or transfer for which
the written consent of Lender has not been first obtained, Lender shall have the right to declare
all indebtedness secured by this Deed of Trust to be immediately due and payable.
Grantor acknowledges that Lender, in determining whether or not to make the loan
secured hereby, examined the qualifications and creditworthiness of Grantor, found them to be
acceptable, and relied and will continue to rely upon the same as the means of repayment of the
loan. Grantor also acknowledges that Lender evaluated the background and experience of
Grantor in owning and operating property such as the Property, found them acceptable and relied
and will continue to rely upon the same as the means of maintaining the value of the Property
which is Lender's security for the loan. Granter acknowledges that it is a business person or
entity well-experienced in borrowing money and owning and operating property such as the
Property, was ably represented by licensed attorneys-at-law in the negotiation and documentation
of the loan secured hereby and bargained at arm's length, in good faith, and without duress of
any kind for all of the terms and conditions of the Note, this Deed of Trust and the other loan
documents, including this Section. Grantor further recognizes that any secondary or junior
financing placed upon the Property (a) may divert funds which would otherwise be used to pay
the indebtedness secured hereby; (b) could result in acceleration and foreclosure by any such
junior encumbrancer which would force Lender to take measures and incur expenses to protect
its secruity; and (c) would impair Lender's right to accept a deed in lieu of foreclosure from
Grantor, as a foreclosure by Lender would be necessary to clear the title to the Property.
In accordance with the foregoing and for the purposes of (i) protecting Lender's security,
both of repayment by Grantor and of the value of the Property; (ii) giving Lender the ful1 benefit
of its bargain and contract with Grantor; and (iii) keeping the Property free of subordinate
financing liens, Grantor agrees that if anything in this Section be deemed a restraint on
alienation, that it is a reasonable one and that except as otherwise herein provided any sale,
conveyance, lease, assignment, exchange, pledge, mortgage, hypothecation, further encumbrance
or other transfer of title to the Property or any interest therein (whether voluntary or by operation
of law) without Lender's prior written consent shall be an event of default hereunder. For the
purpose of illustrating, and without limiting the generality of, the preceding sentence, the
occurrence at any time of any of the following events shall be deemed to be an unpermitted
transfer of title to the Property and therefore an event of default hereunder:

11

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(a)
any sale, conveyance, lease, assignment, exchange, pledge, mortgage,
hypothecation, further encumbrance or other transfer of, or the grant of a security interest
in, all or any part of the Property; or
(b)
any sale, conveyance, assignment, exchange, pledge, mortgage,
hypothecation, encumbrance or other transfer of, or the grant of a security interest in, any
partnership interest of any partner; or
(c)

any change in the present composition of Grantor or its partners.

Any waiver by Lender of a default by Grantor under this Section shall not constitute a
waiver of any right, remedy or power of Lender upon a subsequent event of default by Grantor
under this Section, and any consent to any one sale, conveyance, lease, assignment, exchange,
pledge, mortgage, hypothecation, further encumbrance or other transfer as hereinbefore
enumerated shall not be deemed a consent to any subsequent such act.
If Grantor sells or transfers any of its interest in the Property without the prior written
consent of Lender, Lender or its successors and/or assigns may declare the entire balance secured
by this Deed of Trust immediately due and payable or, at its sole option, may increase the
Interest Rate (as the term "Interest Rate" is defined in the Note) being charged under the Note
up to the prevailing market rate at the time, and may require (i) payment of a reasonable transfer
fee and (ii) reimbursement for all expenses, legal and otherwise, incurred by Lender.
For the purpose of the foregoing paragraphs, the term "sell or transfer" shall include> in
addition to the common and ordinary meanings of those terms and without limiting their
generality, transfers made to a subsidiary or affiliated entity of Grantor, transfers to a
reconstituted general or limited partnership, transfers made by a partner to the individual partners
or vice-versa, transfers made by a partner to other partners or to third parties, transfers by any
corporation or its stockholders or vice-versa, any corporate merger or consolidation and transfers
made by any individual to any other individual or any entity, or vice-versa.
Notwithstanding the above, the term <<sell, convey, lease, assign, exchange, pledge,
mortgage, hypothecate or transfer" the Property shall not include a sale or transfer of any
partnership interest of any general partner of the Grantor due to the insolvency, death, mental
incapacity or marital separation and settlement of any of the general partners of the Grantor.

It is expressly provided that, anything in this Section to the contrary notwithstanding, that
there shall be no secondary financing during the term of this Deed of Trust and no subordinate
debt instrument of any kind or other encumbrance without Lender's prior written approval.
ARTICLE II
ASSIGNMENT OF LEASES, SUBLEASES
FRANCHISES, RENTS, ISSUES AND PROFITS
2.1.
Assignment of Rents. Grantor hereby collaterally assigns and transfers to Lender
all the leases, subleases, franchises, rents, issues and profits of the Property, and hereby gives to
and confers upon Lender the right, power and authority to collect such rents, issues and profits as

12

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herein set forth. Grantor irrevocably appoints Lender its true and lawful attomey-in-fact 1 at the
option of Lender, immediately and without further legal action being necessary, to demand,
receive and enforce payment, to give receipts, releases and satisfactions, and to sue, in the name
of Gran tor or Lender, for all such rents, issues and profits and apply the same to the indebtedness
secured hereby; provided, however, that Grantor shall have the right to collect such rents, issues
and profits (but not more than one month in advance) prior to the occurrence of an event of
default or at any time there is not ongoing an uncured event of default under this Deed of Trust.
2.2.
Collection Upon Default. Upon the occurrence of an event of default under this
Deed of Trust, Lender may exercise any of the rights granted to it under applicable law and may
further, at any time without notice, either in person, by agent or by receiver appoint by a court, ·
and without regard to the adequacy of any security for the indebtedness hereby secured, enter
upon and take possession of the Property, or any part thereof, in its own name, sue for or
otherwise collect such rents, issues and profits, including those past due and unpaid, and apply
the same, less costs and expenses of operation and collection, including attorneys' fees, upon any
indebtedness secured hereby, and in such order as Lender may determine. The collection of such
rents, issues and profits, or the entering upon and taking possession of the Property, or the
application thereof as aforesaid, shall not cure or waive any default or notice of default hereunder
or invalidate any act done in response to such default or pursuant to such notice default.
2.3.
Restriction on Further Assignments, etc. Except as hereinafter specifically
provided, Grantor shall not, without the prior written consent of the Lender, assign the rents,
issues or profits, or any part thereof, from the Property or any part thereof; and shall not consent
to the modification, cancellation or surrender of any lease or sublease covering the Property. An
action of Granter in violation of terms of this Section shall be void as against Lender in addition
to being a default under this Deed of Trust.
Grantor shall not, without the consent of Lender, consent to the cancellation or surrender
or, accept prepayment of rents, issues or profits, other than rent paid at the signing of a lease or
sublease, under any lease or sublease now or hereafter covering the Property or any part thereof,
nor modify any such lease or sublease so as to shorten the term, decrease the rent, accelerate the
payment of rent1 or change the terms of any renewal option, and any such purported assignment,
cancellation, surrender, prepayment or modification made without the written consent of Lender
shall be void as against Lender. Granter shall, upon demand of Lender, enter into an agreement
with Lender with respect to the provisions contained in the preceding provisions regarding any
lease or sublease covering said Property or any part thereof, and Granter hereby appoints Lender .
attorney-in-fact of Grantor to execute and deliver any such agreement on behalf of Granter and
deliver written notice thereof to the tenant to whose lease such agreement relates,
Grantor agrees to furnish to Lender a copy of any modification of any lease presently in
effect and copies of all leases affecting the Property covered by this Deed of Trust, and failure to
furnish to Lender a copy of any modification of a lease or a copy of any future lease affecting
said Property, shall be deemed a default under this Deed of Trust and the Note, for which the
holder of this Deed of Trust may, at its option, declare the entire unpaid balance of this Deed of
Trust and the Note to be immediately due and payable.

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All leases or subleases hereafter entered into by Grantor with respect to the Property or
any part thereof, shall be subordinate to the lien of this Deed of Trust unless expressly made
superior to this Deed of Trust in the manner hereinafter provided. At any time or times Lender
may execute and record in the appropriate Office of the County Clerk of the County where the
Premises are situated, a Notice of Subordination reciting that the lease or lea.ses therein described
shall be superior to the lien of this Deed of Tmst. From and after the recordation of such Notice
of Subordination, the lease or leases therein described shall be superior to the lien of this Deed of
Trust and shall not be extinguished by any foreclosure sale hereunder.

1-.---:.:i"

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ARTICLE III
RESERVED
\fJ

ARTICLE IV
SECURITY AGREEMENT
4.1.
Creation of Security Interest. Grantor hereby grants to Lender a security
interest in any and all Personal Property included within the Property located on or at the
Premises, including without limitation any and all property of similar type or kind hereafter
located on or at the Premises for the purposes of securing all obligations of Grantor set forth in
this Deed of Trust. This instrument is a self-operative security agreement with respect to the
above described property, but Grantor agrees to execute and deliver on demand such other
security agreements, financing statements and other instruments as Lender may request.
4.2.
Warranties, Representations and Covenants of Grantor.
warrants, represents and covenants as follows:

Granter hereby

(a)
Except for the security interest granted hereby, Grantor is, and as to
portions of the Personal Property to be acquired after the date hereof will be, the sole
owner of the Personal Property, free from any adverse lien, security interest,
encumbrance or adverse claims thereon of any kind whatsoever. Grantor shall notify
Lender of, and shall defend the Personal Property against, all claims and demands of all
persons at any time claiming the same or any interest therein.
(b)
Grantor shall not lease, sell, convey or in any manner transfer the Personal
Property without the prior written consent of Lender.
(c)
The Personal Property is not and shall not be used or bought for personal,
family or household purposes.
(d)
The Personal Property shall be kept on or at the Premises and Grantor will
not remove the Personal Property from the Premises without the prior written consent of
Lender, except such portions or items of Personal Property which are consummated or
worn out in ordinary usage, all of which shall be promptly replaced by Grantor.

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(e)
Grantor maintains a place of business in the State of North Carolina and
Grantor shall immediately notify Lender in writing of any change in its place of business
as set forth in the beginning of this Deed of Trust.

All covenants and obligations of Grantor contained herein relating to the
(f)
Property shall be deemed to apply to the Personal Property whether or not expressly
referred to herein.
(g)
This Deed of Trust constitutes a "Securicy Agreement" as that term is
used in the Uniform Commercial Code of North Carolina.

4.3.

Fixture Filing. This Deed of Trust constitutes a financing statement filed as a .

fixture filing in the Official Records of the Register of Deeds with respect to any and all Fixtures.
The "debtor" is the Grantor and the record owner of the Premises; the "secured party'' is the
Lender; the collateral is as described in this Deed of Trust; and the addresses of the debtor and
secured party are the addresses stated in this Deed of Trust for notices to such parties.

Authorization to File. Grantor irrevocably authorizes Lender to file, in the
4.4.
appropriate locations for filings of financing statements in any jurisdiction(s) that Lender in good
faith deems appropriate, such financing statements and amendments thereto as Lender may deem
necessary or desirable in order to (i) perfect or continue the security interests granted by Grantor
to Lender pursuant to this Deed of Trust, (ii) prevent any filed financing statement from
becoming misleading, or (iii) prevent any filed financing statement from losing its perfected
status.

ARTICLEV
REMEDIES UPON DEFAULT
5.1.
Events of Default. Any one or more of the following shall constitute a "Default"
under this Deed of Trust and the Note hereby secured:
(a)
Failure of Grantor to make one or more payments required by the Note on
the due date thereof, without notice or demand.
(b)
Failure of Grantor to pay the amount of any costs, expenses or fees
(including counsel fees) of Lender, with interest thereon, as required by any provision of
this Deed of Trust.
(c)
Failure of Grantor to comply with or perform any other warranty,
covenant or agreement contained herein, in the Note, in the Loan Agreement, if any, in
the Commitment Letter dated December 10, 2004 (the "Commitment"), or in any other
document executed by Grantor in conjunction with this transaction within thirty (30) days
after receipt of written notice thereof by Grantor; provided, however, that (i) if Grantor
reasonably cannot perform or comply with any such obligation within such thirty (30)
day period and if, in Lender's reasonable judgment, Lender's security will not be
impaired, then Grantor may have such additional time to rectify such failure as Grantor

15

reasonably may require, provided and for so long as Grantor proceeds with due diligence,
and (ii) if, in Lender's reasonable judgment, Lender's security will be impaired if Grantor
does not perform or comply with any such obligation in a period of less than thirty (30)
days, Grantor will have only such period (if any) following demand in which to rectify
such failure as Lender may reasonably specify.
(d)
Determination by Lender that any representation or warranty of Grantor
contained in this Deed of Trust, the Note, or in any other document or certificate
executed by Grantor in connection with this transaction was incorrect or misleading in
any material respect as of the date on which the same was made, including, without
limitation, any and all financial statements furnished by Grantor to Lender as an
inducement to Lender's making the loan evidenced by the Note or otherwise furnished
pursuant to any provision of this Deed of Trust, the Conunitment, or any related
document.
(e)
The assertion of any federal, state, or local tax lien, or any claim or lien for
labor or materials, or any other lien or encumbrance of any nature whatsoever (including
any judgment lien) against Grantor or the Property, and the same is not removed by
payment or transferred to substitute security in the manner provided by law within the
lesser of thirty (30) days after its recording or ten ( l 0) days after demand by Lender.
(f)
The filing by Grantor or any guarantor of a voluntary petition in
bankruptcy, or for reorganization or for an arrangement, pursuant to the Federal
Bankruptcy Code or any similar law, ·federal or state, now or hereafter in effect, or the
making of an assigrunent for a benefit of creditors, or the admittance in writing of its
inability to pay its debts as they become due, or the suspension of the payment of its
obligations, or the taking of any action in furtherance of the foregoing, or the consent of
Grantor or any guarantor to the appointment of a receiver, trustee, liquidator, or other
similar official for Grantor or any guarantor or for the Property, or any of them.
The filing of a petition or an answer proposing an adjudication of Grantor
(g)
or any guarantor as a bankrupt, or proposing Grantor's or any guarantor's reorganization
pursuant to the Federal Bankruptcy Code or any similar law, federal or state, now or
hereafter in effect, and the approval thereof by any court of competent jwisdiction and
the entry of an order approving the same, unless such order shall be vacated or stayed
within sixty (60) days from entry, or if Grantor or any guarantor shall consent to the
filing of any such petition or answer, or fail to deny the material allegations of the same
in a timely manner.
(h)
Death (in the case of an individual) of Grantor or any guarantor, or the
initiation of an action or proceeding for the dissolution, termination or liquidation of
Grantor or any guarantor.
The occurrence of an event of default under any other agreement of
(i)
Grantor whereby Grantor is obligated to repay any indebtedness, whether such agreement
obligates Grantor to repay such indebtedness to Lender or any other party.

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If

G)
A determination by Lender that a material adverse change has occurred in
the financial condition of Grantor or any guarantor since the financial condition of
· Grantor or any guarantor was disclosed to Lender in connection herewith.
5.2.

Default Rate. The tenn "Default Rate", as used herein, shall mean the rate of
interest after maturity or default provided in the Note or the maximum rate permitted by North
Carolina law, whichever is less; provided, however, that at no time shall any interest or charges
in the nature of interest be taken, exacted, received or collected which would exceed the
maximum rate permitted by law.

N
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•,t.}

5.3. Acceleration Upon Default, Additional Remedies. In the event that one or
more Defaults as above provided shall occur, the remedies available to Lender shall include, but
not necessarily be limited to, any one or more of the following:
(a)
Lender shall declare the entire unpaid balance of the Note, together with
any amounts outstanding hereunder, immediately due without notice.
(b)
Lender may take immediate possession of the Property or any part thereof
(which Grantor agrees to surrender to Lender) and manage, control or lease the same to
such person or persons and at such rental as it may deem proper and collect all rents,
issues and profits, therefrom, including those past due as well as those thereafter
accruing, with the right in the Lender to cancel any lease or sublease for any cause which
would entitle Grantor to cancel the same; to make such expenditures for maintenance,
repairs and costs of operation as it may deem advisable; and after deducting the cost
thereof and a commission of five (5%) percent upon the gross amount of rents collected,
to apply the residue to the payment of any sums which are unpaid hereunder or under the
Note. The taking of possession under this paragraph shall not prevent concurrent or later
proceedings for the foreclosure sale of the Property as provided elsewhere herein.
(c)
Lender may apply to any court of competent jurisdiction for the
appointment of a receiver or similar official to manage and operate the Property, or any
part thereof, and to apply the net rents and profits therefrom to the payment of the interest
and/or principal of the Note and/or any other obligations of Grantor to Lender hereunder.
In event of such application, Grantor agrees to consent to the appointment of such
receiver or similar official, and agrees that such receiver or similar official may be
appointed without notice to Grantor, with regard to the adequacy of any security for the
debts and with regard to the solvency of Grantor or any other person, firm or corporation
who or which may be liable for the payment of the Note or any other obligation of
Grantor hereunder.
Upon application of Lender, Trustee shall sell the Property and pay the
(d)
proceeds of sale according to the following terms and conditions: (a) Trustee shall
foreclose upon this Deed of Trust and sell the Property, or any part of the Property, at
public sale conducted according to applicable law (referred to as "Trustee's Sale"); (b)
Trustee shall provide such notice and shall advertise a Trustee's Sale in the manner
required by applicable law; (c) Trustee shall conduct additional Trustee's Sales as may be
required until all of the Property is sold or the Liabilities are satisfied; ( d) Trustee, may

17

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"

receive bids at Trustee's Sale from the Lender and may accept from Lender as successful
bidder, credit against the Liabilities as payment of any portion of the purchase price; (e)
Trustee may receive a reasonable fee for Trustee's services hereunder, not to exceed the
maximum fee allowed by applicable law; and (f) Trustee shall apply the proceeds of
Trustee's Sale, first to any pennitted Trustee's fee, second to expenses of foreclosure and
sale, third to the Liabilities, and any remaining proceeds as required by law.
(e)
Lender may realize upon the Personal Property which is collateral
heretofore, enforce and exercise all of the Grantor's rights, powers, privileges and
remedies in respect of the Personal Property collateral, dispose of or otherwise deal with
the Personal Property collateral in such order as Lender may in its discretion determine,
and exercise any and all other rights, powers, privileges and remedies afforded to a
secured party under the laws of the State of North Carolina, as well as all other rights or
remedies available at Jaw or in equity with regard to the Property collateral.

5.4.
Additional Provisions. Grantor expressly agrees, on behalf of itself, its
successors and assigns and any future owner of the Property, or any part thereof or interest
therein, as follows:
(a)
All remedies available to Lender with respect to this Deed of Trust shall
be cumulative and may be pursued concurrently or successively. No delay by Lender in
exercising any such remedy shall operate as a waiver thereof or preclude the exercise
thereof during the continuance of that or any subsequent default.
(b)
The obtaining of a judgment or decree on the Note, whether in the State of
North Carolina or elsewhere, shall not in any manner affect the lien of this Deed of Trust
upon the Property covered hereby, and any judgment or decree so obtained shall be
secured to the same extent as the Note is now secured.
(c)
In the event of any foreclosure sale hereunder, all net proceeds shall be
available for application to the indebtedness hereby secured whether or not such proceeds
may exceed the value of the Property for unpaid taxes, liens, assessments and any other
costs relating to the Property.
(d)
The only limitation upon the foregoing agreements as to the exercise of
Lender's remedies is that there shall be but one full and complete satisfaction of the
indebtedness secured hereby.
(e)
The Grantor shall duly, promptly and fully perfonn each and every term
and provision of the Commitment, the Loan Agreement (if any), or any other documents
which have been executed and delivered by the parties hereto simultaneously with the
execution and delivery hereof, the terms of the Commitment and the Loan Agreement (if
any), being incorporated herein by reference. The lien of this Deed of Trust secures the
payment of all sums payable to Lender and the performance of all covenants and
agreements of Grantor under the terms of the Commitment, the Loan Agreement (if any),
or any other docwnent delivered herewith.

18

5.5.
Remedies Not Exclusive. Lender shall be entitled to enforce payment and
performance of any indebtedness or obligations secured hereby and to exercise all rights and
powers under this Deed of Trust or the Note or under any other agreement or any Jaws 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 or trust,
pledge, lien, assigrunent or otherwise. Neither the acceptance of this Deed of Trust nor its
enforcement shall prejudice or in any manner affect Lender's right to realize upon or enforce any
other security now or hereafter held by Lender, it being agreed that Lender shall be entitled to
enforce this Deed of Trust and any other security now or hereafter held by Lender in such order
and manner as Lender may in its absolute discretion determine. No remedy herein conferred
upon or reserved to Lender is intended to be exclusive of any other remedy contained herein or
by law or in equity provided or permitted, but each shall be cumulative and shall be in addition
to every other remedy given hereunder or not or hereafter existing at law or in equity or by
statute. Every power or remedy given to Lender or to which it may be otherwise entitled, may be
exercised, concurrently or independently, from time to time and as often as may be deemed
expedient by Lender and it may pursue inconsistent remedies.
5.6.
WAIVER.
TO THE EXTENT PERMITTED BY LAW, GRANTOR
ACKNOWLEDGES THE RIGHTS GIVEN HEREJN TO LENDER TO ACCELERATE THE
DEBT SECURED HEREBY AND TO SELL THE PROPERTY AT PUBLIC AUCTION
PURSUANT TO THE POWER OF SALE GRANTED HEREIN. GRANTOR WAIVES ANY
RIGHTS TO NOTICE AND HEARING PRIOR TO SUCH SALE UNDER POWER, OTHER
THAN AS EXPRESSLY PROVIDED JN THE NOTE OR THIS DEED OF TRUST.
GRANTOR WAIVES ALL RIGHT OR EQUITY OF REDEMPTION JN THE PROPERTY
AFTER A FORECLOSURE SALE.

ARTICLE VI
MISCELLANEOUS
6.1.
Partnership Status. Grantor represents and wa1Tants to Lender that Grantor is a
limited partnership organized and existing under the laws of the State of Delaware and has been
duly and validly formed. Grantor further warranties that it has the power, authority and legal
right to carry on the business now being conducted by it and to engage in the transactions
contemplated by the Note, this Deed of Trust, and any other loan documents executed herewith,
and that the execution and delivery of the Note, this Deed of Trust and the other loan documents
executed herewith and the performance and observance of the provisions thereof have been duly
authorized by all necessary partnership action. Grantor covenants and agrees not to do anything
that would cause a termination of the Partnership nor in any way adversely affect its good
standing within the State of North Carolina. Any and all annual filing reports and any other
reports required by the State of Delaware, the State of North Carolina or any other governmental
entity shall be filed in a timely manner, and proof of said filing shall be furnished to Lender upon
request.
6.2.
Statements by Grantor. Grantor, within three (3) days after request in person or
within ten (10) days after request by mail, will furnish to Lender or any person, firm or
corporation designated by Lender, a duly acknowledged written statement setting forth the
amount of the debt secured by this Deed of Trust, and stating either that no offsets or defenses

19
"----------------------------------··-- - - - -

exist against such debt or, if such offsets or defenses are alleged to exist, full infonnation with
respect to such alleged offsets and/or defenses.
6;3.
Successors and Assigns. The provisions hereof shall be binding upon and shall
inure to the benefit of Grantor, its successors and assigns, including without limitation
subsequent owners of the Property or any part thereof, shall be binding upon and shall inure to
the benefit of Lender, its successors and assigns of any future holder of the Note. In the event
the ownership of the Property or any leasehold estate that may be covered by this Deed of Trust,
becomes vested in a person other than Grantor, Lender may, without notice to Grantor, deal with
such successor or successors in interest with reference to this instrument and the Note in the
same manner as with Granter, and may alter the interest rate and/or alter or extend the terms of
payment of the Note without notice to Grantor hereunder or under the Note hereby secured or the
lien or priority of this Deed of Trust with respect to any part of the Property covered hereby, but
nothing herein contained shall serve to relieve Grantor of any liability under the Note or this
Deed of Trust (or any other agreement executed in conjunction therewith) unless Lender shall
expressly release Grantor in writing. Grantor and any transferee or assignee shall be jointly and
severally liable for any documentary stamp or intangible taxes imposed as a result of any transfer
or assumption.
· 6.4.
Notices. All notices which are required or permitted hereunder must be in writing
and shall be deemed to have been given, delivered or made, as the case may be (notwithstanding
lack of actual receipt by the addressee), (i) on hand delivery thereof to the recipient, (ii) seven (7)
business days after having been deposited in the United States mail, certified or registered, return
receipt requested, sufficient postage affixed and prepaid, or (iii) one ( 1) business day after having
been deposited with an expedited, overnight courier service (such as by way of example but not
limitation, U.S. Express Mail, Federal Express or Airborne), addressed to the party to whom
notice is intended to be given at the address set forth below:
TOGRANTOR:

Scoop Real Estate, L.P.
1618 Main Street
Sarasota, Florida 34236

TO LENDER:

Wachovia Bank, N.A.
100 South Ashley Drive, Suite 950
Tampa, Florida 33602

Any party may change the address to which its notices are sent by giving the other party
written notice of any such change in the manner provided in this section, but notice of change of
address is effective only upon receipt.

Grantor shall deliver to Lender, promptly upon receipt of same, copies of all notices,
certificates, documents and instruments received by it which materially affect any part of the
Property covered hereby, including, without limitation, notices from any lessee or sublessee
claiming that Grantor is in default under any terms of any lease or sublease.

20

6.5.
Modifications in Writing. This Deed of Trust may not be changed, terminated
or modified orally or in any other manner than by an instrument in writing signed by the party
against whom enforcement is sought.
6.6.
Captions. The captions or headings at the beginning of each Section hereof are
for the convenience of the parties and are not a part of this Deed of Trust.
6.7.
Invalidity of Certain Provisions. If the lien of this Deed of Trust is invalid or
unenforceable as to any part of the debt~ or if the lien is invalid or unenforceable as to any part of
the Property, the unsecured portion of the debt shall be completely paid prior to the payments of
the secured portion of the debt, and all payments made on the debt, whether voluntary or
otherwise, shall be considered to have been first paid on and applied to the full payment of that
portion of the debt which is not secured or fully secured by the lien of this Deed of Trust.
.=J<:.

J';::.

i:::;f-1

No Merger. If both the lessor's and lessee's estates under any lease or any
6.8.
portion thereof which constitutes a part of the Property shall at any time become vested in one
owner, this Deed of Trust and the lien created hereby shall not be destroyed or tenninated by
application of the doctrine of merger and, in such event, Lender shall continue to have and enjoy
all of the rights and privileges of Lender as to the separate estates. In addition, upon the
foreclosure of the lien created by this Deed of Trust on the Property pursuant to the provisions
hereof> any leases or subleases then existing and created by Granter shall not be destroyed or
terminated by application of the law of merger or as a result of such foreclosure sale shall so
elect. No act by or on behalf of Lender or any such purchaser shall constitute a tennination of
any lease or sublease unless Lender or such purchaser shall give written notice thereof to such
tenant or subtenant.

6.9.

Governing Law and Construction of Clauses. This Deed of Trust shall be
governed and construed by the laws of the State of North Carolina. No act of the Lender shall be
construed as an election to proceed under any one provision of the Deed of Trust or of the
applicable statutes of the State of North Carolina to the exclusion of any other such provision,
anything herein or otherwise to the contrary notwithstanding.
6.10. Corrective Documentation. For and in consideration of the funding or renewal
of the indebtedness evidenced by the Note, Granter further agrees to cooperate with Lender and
to reexecute any and all documentation relating to the loan evidenced by the Note and secured by
this Deed of Trust which are deemed necessary or desirable in Lender's discretion, in order to
correct or adjust any clerical errors or omissions contained in any such docmnent executed in
connection with the loan evidenced by the Note and secured by this Deed of Trust.

6.11. Books and Records. Grantor will maintain books of accounts and records
reflecting Grantor's financial condition and the results of operations of the Property in
accordance with generally accepted accounting principles applied on a consistent basis. If any of
the Property is rented or leased, a rent schedule of the Property, certified by an accounting officer
of Granter, showing the name of each tenant and the space occupied, the lease expiration date
and the rent payable will also be maintained by Granter. Lender will have the right, from time to
time at all times during normal business hours, to examine such books, records and accounts at

21

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---

--

the offices of Grantor or other personal entity maintaining such books, records and accounts and
to make such copies as Lender will desire.
6.12. Financial Statements. Grantor will within ninety (90) days after the end of each
fiscal year, furnish to Lender complete financial statements prepared in accordance with
generally accepted accounting principles applied on a consistent basis, including a profit and loss
statement, an income and expense statement, a balance sheet, a reconciliation of surplus, Federal
tax returns, and any other financial information which may be reasonably required, which
statements shall, at Lender's option, be certified without qualification by audit of the certified
public accountant regularly serving Grantor and approved by Lender. The cost of such audit
shall be paid by Grantor. If any of the Property is rented or leased, Grantor will furnish to
Lender together with the financial statements discussed above a rent schedule as described in
Section 6.11 above. Grantor shall also furnish to Lender such interim statements as may
reasonably be required by Lender from time to time.
6.13. Other Indebtedness Secured. Thls Deed of Trust is also given as security for
any and all other sums, indebtedness, obligations and liabilities of any and every kind now or
hereafter during the term owing and to become due from Grantor to Lender, however created,
incurred, evidenced, acquired or arising, whether under the Note or this Deed of Trust, or any
other instrument, obligation, contract, agreement or dealing of any and every kind now or
hereafter existing or entered into between Grantor and Lender, or otherwise as amended,
modified or supplemented from time to time, and whether direct, indirect, primary, secondary,
fixed or contingent, and any and all renewals, modifications or extensions of any or all of the
foregoing.
6.14. Costs. Grantor shall pay all and singular the costs, charges and expenses,
including without limitation attorneys' fees, paralegals' fees> sales tax on such fees or costs, if
any (regardless of whether suit is or other proceedings are instituted, and for all arbitration,
administrative, bankruptcy and other proceedings) and abstract costs, reasonably incurred or paid
at any time by Lender because of the failure of Grantor to perform, comply with, and bide by
each and every stipulation, agreement, condition and covenant of the Note, this Deed of Trust or
any other document executed herewith.
BY THE EXECUTION HEREOF, GRANTOR
6.15. Waiver of Jury Trial.
KNOWINGLY, VO LUNTARIL Y AND INTENTIONALLY AGREES THAT NEITHER
GRANTOR NOR ANY ASSIGNEE, SUCCESSOR, HEIR, OR LEGAL REPRESENTATIVE
OF GRANTOR SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING,
COUNTERCLAIM, OR ANY OTHER LITIGATION PROCEDURE ARISING FROM OR
BASED UPON THE NOTE, THIS DEED OF TRUST, OR ANY OTHER LOAN DOCUMENT
EVIDENCING, SECURING, OR RELATING TO THE INDEBTEDNESS SECURED BY
THIS DEED OF TRUST OR TO THE DEALINGS OR RELATIONSHIP BETWEEN OR
AMONG THE PARTIES HERETO. NEITHER GRANTOR NOR LENDER WILL SEEK TO
CONSOLIDATE ANY SUCH ACTION IN WHICH A JURY TRIAL HAS BEEN WAIVED
WITH ANY OTHER ACTION IN WHICH A JURY TRIAL HAS NOT OR CANNOT BE
WAIVED. THE PROVISIONS OF THIS SECTION HAVE BEEN FULLY NEGOTIATED BY
THE PARTIES HERETO, AND THESE PROVISIONS SHALL BE SUBJECT TO NO
EXCEPTION. NEITHER GRANTOR NOR LENDER HAS IN ANY WAY AGREED WITH

22

,.

.

,

OR REPRESENTED TO ANY OTHER PARTY THAT THE PROVISIONS OF THIS
SECTION WILL NOT BE FULLY ENFORCED IN ALL INSTANCES. THIS PROVISION IS
A MATERIAL INDUCEMENT FOR LENDER TO ENTER INTO THIS TRANSACTION.

ri~

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l'i'fi;

;,~

f4

~.,.:.:;;,-

6.16. Right to First Offer. When Grantor elects to arrange permanent financing with
respect to the Property, Lender or its affiliates, including Wachovia Securities and Wachovia
Corporation (collectively, "Wachovia"), shall have the right of first opportunity to register
Wachovia Securities, Principal Capital Real Estate Investors, Deutsche Banc Mortgage Capital ·
and Aegon USA Realty Advisors to provide pennanent financing for the subject Property on
terms satisfactory to Grantor. Grantor will provide first notification to Wachovia of its intent to
obtain permanent financing and will in a timely manner use its best efforts to provide Wachovia
with the information necessary to enable it to obtain such financing.
6.17. State Specific Provisions. Lender may, at any time and from time to time,
without notice, at the Lender's discretion, remove Trustee and appoint a substitute trustee
("Substitute Trustee") by filing in the records where this Deed of Trust is recorded an .
instrument affecting such removal and appointment. A Substitute Trustee shall be vested with
title to the Property and with all rights, powers, and duties of the original Trustee herein and all
provisions hereof pertaining to the Trustee shall similarly affect any Substitute Trustee. Any
oath or bond by the Trustee is hereby waived.
[Signature Page Follows]

23

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·'

'•

IN WITNESS WHEREOF, Grantor has hereunto set hand and seal all done as of the day
and year first hereinbefore written.
SCOOP REAL ESTATE, L.P., a Delaware
limited partnership
By:

Print Nam

ORAJ13 ~

SCOOP CAPITAL, LLC, a Florida
limited liability company, its general
partner

By:~
. ~hur Nadel, its Manager j

I'!

~~ER
STATE OF FLORIDA
COUNTY OF SARASOTA

KATHRYN i:. STAHLER

'-

~/)

11.

T, \
a Notary Public of .._JQ.rQ $Ui-V\... County, State of
Florida, do hereby certify that Arthur Nadel personally came before me this day and
acknowledged that he is the Manager of Scoop Capital, LLC, a Florida limited liability company,
general partner ("General Partner") of SCOOP REAL ESTATE, L.P., a Delaware limited
pmtnership (the "Partnership"), and that by authority duly given, the foregoing instrument was
signed by the General Partner as its act and deed and as the act and deed of the Partnership.
Witness my hand and notarial seal on May

l~oos.

My Commission Expires: <() ~ ~ • z_ o 07
[OFFICIAL SEAL]

24
!
I
..........................................~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ _J

...

'.

,.

,11.

...

.'

~

CLERK'S CERTIFICATE

:t &

The forgoing certificate(s) of
be correct. This instrument and this certihcate
book and page shown on the first page hereof.

1

'-11~ ~co,-1JJ

\A

ti

f Sj-o h \.ek

is certified to

are' duly registe~ed'at the date and time and in the

REGISTER OF DEEDS FOR ALAMANCE COUNTY

DA>\'.ID J. P. BARBER

~~ ~
~&~~Deeds

By:

G;\.IPJ\wachovia\Scoop Real Estate\Eckerd (Graham, NC)\Loan Documents\Deed ofTrustV2.doc

25

()
Comp~r.oller of the Currency
· Administrator of ·National Banks
. .. ·.··. .. · ..

w·ashlngton~··oc:2p219
......
.March 20, 20f0 .
·Mr.. J~~s.E.. Hanso{i.
S'enior Vice President .
Wells .Fargo Bank, Ni:itional Association
90 South: Seventh' Street
Minneapolis~ 'MN'-.s·s479·
.

'

Re:

:.·

'

Applications.to.~erge Wachovia Bank, National Association, Charlotte, North CarQlina

·and Wachovia Bank of Delaware, National Association,. Wilmington, Delaware with and
into: Wells Fargo Bank, National Association, Sioux Falls, South Dakota . .
· · Application Control Number: 2009-ML-02-0012
·
·
Dear Mr. 'Hanson:

.....

•

This letter~~ the ofP,~i'al ~cknowledgeme~t, authorization and certification by the Office 'of the.. ·
Comptroller··of the Currency (OCC) that effective March 20, 201 OWachovia Bank~ National . · :·
Association, .Charlotte,, North Carolina and Wachovia Bank of Delaware, National Assocjatfon,
WilmingtQn, Delaware merged with and into Wells Fargo Bank, National Association, Sioux
Falls, South Dakota, under the title of the latter. As result of the merger, the OCC 'has. · .
. renumbered the charter number of Wells Fargo Bank, National Association (the resulting bank)
·
from charter. number 1741 to chart~r number 1.
This letter:ls·.als.o the official authorization for W,ells Fargo Bank, National Associatio~ to ·. : .·... "
·operate the· former' main _office of Wachovia Bank of Delaware, N~tional Assodation and the · .·
branch offices·Qf'Wacliovia Bank, National Association and Wachovia Bank of Delaware; . ·. ·
. :N~tiqnal Association as. branches of Welis Fargo .Bank, National Association. A list of branches
for the res:Ulting bapk will be sent under separate cover.
·
If you hav:e questions.regarding thi~ letter, please contact me ~t [phone] or by e-mail at
Stephen~[e-mail]. Please refer~nce the application control number in: any. ...
correspond~~c.e •.._.. · . · ·
·· '
··
"·
...

s~~re!y, _,/~Ji~~.
..·

.
··

Steph . ·A. Lybar,P.7
Larg Bank Liceus· g Lead xpert

·".. ·
·