Common use of Replacement Reserve Clause in Contracts

Replacement Reserve. (a) As additional security for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 per month. So long as no Default or Event of Default has occurred and is continuing, Mortgagee shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As The Mortgaged Property is currently managed by Residence Inn by Marriott, Inc. (“Marriott”), pursuant to that certain Amended and Restated Management Agreement dated as of August 28, 2002, as amended by that First Amendment to Amended and Restated Management Agreement dated November 10, 2004, between AHM RES II Limited Partnership and Marriott (together, the “Marriott Management Agreement”). If the Marriott Management Agreement is terminated, then, as additional security for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair and replacement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the repair, replacement and maintenance of the furniture, fixtures and equipment at the Mortgaged Property and the performance of work which would normally be treated to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, carpets, appliances, fixtures, furnishings, elevators and mechanical and HVAC equipment and such other work as a capital improvement under generally accepted accounting principles Mortgagor deems necessary or appropriate (collectively, the “ReplacementsRepairs”). Commencing Upon the termination of the Marriott Management Agreement, all funds held by Marriott thereunder in the Repairs and Equipment Reserve (as defined in the Marriott Management Agreement) and attributable to the Mortgaged Property shall be immediately assigned to Mortgagee and deposited into the Replacement Reserve. The Replacement Reserve shall be maintained for so long as this Mortgage continues in effect after the termination of the Marriott Management Agreement; provided, however, no monthly deposits will be required to the Replacement Reserve if and for so long as the Mortgaged Property is managed pursuant to a Management Agreement (as hereinafter defined) subsequently entered into in accordance with the provisions of Section 1.30 hereof. If deposits to the Replacement Reserve are required hereunder, deposits shall be made on the first each monthly Payment Date under the Note Note, concurrently with and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment payments due under the Note and until the Debt is fully paid and performed, a deposit Note. Deposits to the Replacement Reserve Reserve, when required, shall be in an amount equal to $1,163 per monthfive percent (5.0%) of the gross revenues of the Mortgaged Property based upon the most recent annual balance sheets and statement of operations for the Mortgaged Property. Notwithstanding the foregoing, if a Management Agreement reserves funds for Repairs in an amount less than five percent (5%) of the gross revenues of the Mortgaged Property as calculated above, then a Replacement Reserve deposit shall be required in an amount equal to the difference between such Management Agreement reserve percentage and five percent (5%) of the gross revenues of the Property as calculated above. So long as no Default or Event of Default has occurred and is continuing, Mortgagee shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee of invoices, receipts receipts, cancelled checks or other evidence reasonably satisfactory to Mortgagee, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests with individual items in excess of $25,00050,000.00, the delivery to Mortgagee of affidavits, lien waivers waivers, cancelled checks or other evidence reasonably satisfactory to Mortgagee showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00050,000.00, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests costing in excess of $50,00050,000.00, delivery to Mortgagee of a new certificate of occupancy or local equivalent for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty ninety (6090) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements Repairs and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee respond within one hundred twenty thirty (12030) days after the receipt of such description from Mortgageerequest, or and, thereafter, Mortgagor shall make such later date Repairs as may be approved mutually agreed upon by Mortgagor and Mortgagee and within such time period as may be mutually agreed upon. Funds contained in its sole discretionthe Replacement Reserve shall be placed in an interest-bearing account upon receipt and interest thereon credited to Mortgagor as provided in Section 4.31 hereof. (b) As additional security for the payment and performance by Mortgagor of all duties, responsibilities and obligations under the Note and the other Loan Documents, Mortgagor hereby unconditionally and irrevocably assigns, conveys, pledges, mortgages, transfers, delivers, deposits, sets over and confirms unto Mortgagee, and hereby grants to Mortgagee a security interest in Mortgagor’s right, title and interest in, (i) the Impound Account, the Replacement Reserve, the Repair and Remediation Reserve and any other reserve or escrow account established pursuant to the terms hereof or of any other Loan Document (collectively, the “Reserves”), (ii) the accounts into which the Reserves have been deposited, (iii) all insurance on said accounts, (iv) all accounts, contract rights and general intangibles or other rights and interests pertaining thereto, (v) all sums now or hereafter therein or represented thereby, (vi) all replacements, substitutions or proceeds thereof, (vii) all instruments and documents now or hereafter evidencing the Reserves or such accounts, (viii) all powers, options, rights, privileges and immunities pertaining to the Reserves (including the right to make withdrawals therefrom), and (ix) all proceeds of the foregoing. Mortgagor hereby authorizes and consents to the account into which the Reserves have been deposited being held in Mortgagee’s name or the name of any entity servicing the Note for Mortgagee and hereby acknowledges and agrees that Mortgagee, or at Mortgagee’s election, such servicing agent, shall have exclusive control over said account. Notice of the assignment and security interest granted to Mortgagee herein may be delivered by Mortgagee at any time to the financial institution wherein the Reserves have been established, and Mortgagee, or such servicing entity, shall have possession of all passbooks or other evidences of such accounts. Mortgagor hereby assumes all risk of loss with respect to amounts on deposit in the Reserves, unless finally determined by a court of competent jurisdiction to have been caused by the gross negligence or willful misconduct of Mortgagee. Mortgagor hereby knowingly, voluntarily and intentionally stipulates, acknowledges and agrees that the advancement of the funds from the Reserves as set forth herein is at Mortgagor’s direction and is not the exercise by Mortgagee of any right of set-off or other remedy upon a Default or an Event of Default. If an Event of Default shall occur hereunder or under any other of the Loan Documents and shall be continuing, Mortgagee may, without notice or demand on Mortgagor, at its option: (A) withdraw any or all of the funds (including, without limitation, interest) then remaining in the Reserves and apply the same, after deducting all costs and expenses of safekeeping, collection and delivery (including, but not limited to, reasonable attorneys’ fees, costs and expenses) to the Debt or any other obligations of Mortgagor under the other Loan Documents in such manner as Mortgagee shall cause deem appropriate in its sole discretion, and the excess, if any, shall be paid to Mortgagor, (B) exercise any and all rights and remedies of a secured party under any applicable Uniform Commercial Code, or (C) exercise any other remedies available at law or in equity. No such use or application of the funds contained in the Reserves shall be deemed to cure any Default or Event of Default. (c) The Reserves shall not, unless otherwise explicitly required by applicable law, be or be deemed to be escrow or trust funds, but, at Mortgagee’s option and in Mortgagee’s discretion, may either be held in a separate account or be commingled by Mortgagee with the general funds of Mortgagee. The Reserves are solely for the protection of Mortgagee and entail no responsibility on Mortgagee’s part beyond the payment of the respective items for which they are held following receipt of bills, invoices or statements therefor in accordance with the terms hereof and beyond the allowing of due credit for the sums actually received. Upon assignment of this Mortgage by Mortgagee and assumption by assignee of Mortgagee’s obligations hereunder, any funds in the Replacement Reserves shall be turned over to the assignee and any responsibility of Mortgagee, as assignor, with respect thereto shall terminate. If the funds in the applicable Reserve shall exceed the amount of payments actually applied by Mortgagee for the purposes and items for which the applicable Reserve is held, such excess may be credited by Mortgagee on subsequent payments to be made hereunder or, at the option of Mortgagee, refunded to Mortgagor. If, however, the applicable Reserve shall not contain sufficient funds to pay the sums required by the dates on which such sums are required to be on deposit in such account, Mortgagor shall, within thirty (30) days after receipt of written notice thereof, deposit with Mortgagee the full amount of any such deficiency. If Mortgagor shall fail to deposit with Mortgagee the full amount of such deficiency as provided above, Mortgagee shall have the option, but not the obligation, to make such deposit, and all amounts so deposited into by Mortgagee, together with interest bearing accounts of thereon at the type customarily maintained Default Interest Rate from the date so deposited by Mortgagee or its servicing agent for the investment of similar reservesuntil actually paid by Mortgagor, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based immediately paid by Mortgagor on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve demand and shall be disbursed for secured by this Mortgage and by all of the other Loan Documents securing all or any part of the Debt. If there is an Event of Default under this Mortgage that shall have occurred and be continuing, Mortgagee may, but shall not be obligated to, apply at any time the balance then remaining in any or all of the Reserves against the Debt in whatever order Mortgagee shall subjectively determine. No such application of any or all of the Reserves shall be deemed to cure any Event of Default. Upon full payment of the items for which Debt in accordance with its terms or at such earlier time as Mortgagee may elect, the balance of any or all of the Reserves then in Mortgagee’s possession shall be paid over to Mortgagor and no other funds in the Replacement Reserve are to be disbursedparty shall have any right or claim thereto.

Replacement Reserve. (a) As additional security for the Debtindebtedness secured by the Deed of Trust, Mortgagor Assumptor shall establish and maintain at all times while this Mortgage the Deed of Trust continues in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee Noteholder for payment of costs and expenses incurred by Mortgagor Assumptor in connection with the performance of work which would normally be treated to the roofs, chimneys, gutters, carpet, appliances, landscaping, signs, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment and such other items as a capital improvement under generally accepted accounting principles the Noteholder may approve from time to time (collectively, the “ReplacementsRepairs”). Commencing on the first Payment Date monthly payment date under the Note which occurs after the Closing Date and continuing thereafter on each Payment Date thereaftermonthly payment date under the Note, Mortgagor Assumptor shall pay to MortgageeNoteholder, concurrently with and in addition to the monthly payment due under the Note and until the Debt Note and all other indebtedness secured by the Deed of Trust is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 1,230.00 per month. So long as no Default default hereunder or Event of Default under the other Loan Documents has occurred and is continuing, Mortgagee all sums in the Replacement Reserve shall be held by Noteholder in the Replacement Reserve to pay the costs and expenses of the Repairs. So long as no default hereunder or under the other Loan Documents has occurred and is continuing beyond any applicable cure period as provided in the Note and/or the Loan Documents, Noteholder shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Assumptor the amount paid or incurred by Mortgagor Assumptor in performing Replacements such Repairs within ten thirty (1030) days following: (a1) the receipt by Mortgagee Noteholder of a written request from Mortgagor Assumptor for disbursement from the Replacement Reserve and a certification by Mortgagor Assumptor in a form approved in writing by Mortgagee Noteholder that the applicable item of Replacement Repair has been completed; (b2) the delivery to Mortgagee Noteholder of invoices, receipts or other reasonable evidence satisfactory to MortgageeNoteholder, verifying the cost of performing the ReplacementsRepairs; (c3) for disbursement requests in excess of $25,000, the delivery to Mortgagee Noteholder of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Noteholder showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d4) for disbursement requests in excess of $25,000, delivery to Mortgagee Noteholder of a certification from an inspecting architect or other third party acceptable to Mortgagee Noteholder describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed Replacements; Repairs: and (e5) for disbursement requests in excess of $50,000, delivery to Mortgagee Noteholder of a new certificate of occupancy for the portion of the Improvements (as defined in the Deed of Trust) covered by such ReplacementsRepairs, if said new certificate of occupancy is required by applicable law, or a certification by Mortgagor Assumptor that no new certificate of occupancy is required. Mortgagee Noteholder shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day periodperiod or in amounts less than $2,500.00. In making any payment from the Replacement Reserve, Mortgagee Noteholder shall be entitled to rely on such request from Mortgagor Assumptor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Noteholder may, at MortgagorAssumptor’s expense, make or cause to be made during the term of this Mortgage the Deed of Trust an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Noteholder in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Noteholder shall provide Mortgagor Assumptor with a written description of the required Replacements Repairs and Mortgagor Assumptor shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Noteholder within one hundred twenty thirty (12030) days after the receipt of such description from MortgageeNoteholder, or such later date as may be approved by Mortgagee Noteholder in its sole discretion. (b) Mortgagee . The Replacement Reserve shall cause be deposited in an interest bearing account and accrue interest in the same manner as the TILC Reserve accrues interest under Section 4.28 of the Deed of Trust. At Noteholder’s option and in Noteholder’s discretion, the Replacement Reserve funds may either be held in a separate account or be commingled by Noteholder with the general funds of Noteholder. The Replacement Reserve is solely for the protection of Noteholder and entails no responsibility on Noteholder’s part beyond the payment of the costs and expenses described in this Section in accordance with the terms hereof and beyond the allowing of due credit for the sums actually received. In the event that the amounts on deposit or available in the Replacement Reserve are inadequate to pay the cost of the Repairs, Assumptor shall pay the amount of such deficiency. Upon assignment of this Deed of Trust by Noteholder, any funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on turned over to the daily outstanding assignee and any responsibility of Noteholder, as assignor, with respect thereto shall terminate. If there is a default under the Deed of Trust which is not cured within any applicable grace or cure period, Noteholder may, but shall not be obligated to, apply at any time the balance then remaining in the Replacement ReserveReserve against the indebtedness secured by the Deed of Trust hereby in whatever order Noteholder shall subjectively determine. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to No such application of the Replacement Reserve shall be retained by Mortgagee and accumulated for deemed to cure any default under the benefit Deed of Mortgagor and added to Trust. Upon full payment of the indebtedness secured hereby in accordance with its terms or at such earlier time as Noteholder may elect, the balance in of the Replacement Reserve and then in Noteholder’s possession shall be disbursed for payment of the items for which paid over to Assumptor and no other funds in the Replacement Reserve are to be disbursedparty shall have any right or claim thereto.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair reserve (the “"Replacement Reserve”") with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement to the Improvements including but not limited to roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical, electrical, plumbing and HVAC equipment (collectively, the "Repairs"), provided such costs and expenses are incurred for repairs (i) not incurred for ordinary wear and tear at the Mortgaged Property and (ii) categorized under generally accepted accounting principles (collectively, the “Replacements”)as a capital expense and not as an operating expense. Commencing on the first Payment Date under the Note June 1, 2004 and continuing on each monthly Payment Date thereafterthereafter under the Note, Mortgagor shall pay to Mortgagee, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 3,502.70 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Mortgagee in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default (as hereinafter defined) or Event of Default has occurred and is continuingoccurred, Mortgagee shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount incurred and paid or incurred by Mortgagor in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a the form approved in writing by Mortgagee that the applicable item of Replacement has been completedattached hereto as Exhibit B; (b) the delivery to Mortgagee of paid invoices, receipts or other evidence reasonably satisfactory to Mortgagee, verifying the cost and payment of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00010,000.00 per item, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property, conditioned only upon such parties' actual receipt (if by check, subject to collection) of such amount due for said labor and materials; (d) for disbursement requests in excess of $25,00010,000.00 per item, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements Repairs and verifying the state of completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00010,000.00 per item, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required; and (f) the receipt by Mortgagee of an administrative fee in the amount of $150.00. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s 's expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements Repairs and Mortgagor shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee within one hundred twenty ninety (12090) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole reasonable discretion. Interest on the funds contained in the Replacement Reserve shall be credited to Mortgagor as provided in Section 4.31 hereof. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent As additional security for the investment payment and performance by Mortgagor of similar reservesall duties, which accounts may not yield responsibilities and obligations under the highest Note and the other Loan Documents, Mortgagor hereby unconditionally and irrevocably assigns, conveys, pledges, mortgages, transfers, delivers, deposits, sets over and confirms unto Mortgagee, and hereby grants to Mortgagee a security interest rate then available. Interest payable on such amounts shall be computed based on in, (i) the daily outstanding balance in Impound Account, the Replacement Reserve, the Repair and Remediation Reserve (as hereinafter defined) and any other reserve or escrow account established pursuant to the terms hereof or of any other Loan Document (collectively, the "Reserves"), (ii) the accounts into which the Reserves have been deposited, (iii) all insurance on said accounts, (iv) all accounts, contract rights and general intangibles or other rights and interests pertaining thereto, (v) all sums now or hereafter therein or represented thereby, (vi) all replacements, substitutions or proceeds thereof, (vii) all instruments and documents now or hereafter evidencing the Reserves or such accounts, (viii) all powers, options, rights, privileges and immunities pertaining to the Reserves (including the right to make withdrawals therefrom), and (ix) all proceeds of the foregoing. Such Mortgagor hereby authorizes and consents to the account into which the Reserves have been deposited being held in Mortgagee's name or the name of any entity servicing the Note for Mortgagee and hereby acknowledges and agrees that Mortgagee, or at Mortgagee's election, such servicing agent, shall have exclusive control over said account, subject to the applicable provisions of the Loan Documents. Notice of the assignment and security interest granted to Mortgagee herein may be delivered by Mortgagee at any time to the financial institution wherein the Reserves have been established, and Mortgagee, or such servicing entity, shall have possession of all passbooks or other evidences of such accounts. Mortgagor hereby assumes all risk of loss with respect to amounts on deposit in the Reserves so long as such amounts are deposited into "Permitted Investments" as defined in Exhibit D. Mortgagor hereby knowingly, voluntarily and intentionally stipulates, acknowledges and agrees that the advancement of the funds from the Reserves as set forth herein is at Mortgagor's direction and is not the exercise by Mortgagee of any right of set-off or other remedy upon an event, which with the passage of time or the giving of notice or both would constitute an Event of Default (a "Default") or an Event of Default. Mortgagor hereby waives all right to withdraw funds from the Reserves except as provided for in this Mortgage. If an Event of Default shall occur hereunder or under any other of the Loan Documents Mortgagee may, without notice or demand on Mortgagor, at its option: (A) withdraw any or all of the funds (including, without limitation, interest) then remaining in the Reserves and apply the same, after deducting all costs and expenses of safekeeping, collection and delivery (including, but not limited to, reasonable attorneys' fees, costs and expenses) to the Debt or any other obligations of Mortgagor under the other Loan Documents in such manner as Mortgagee shall deem appropriate in its sole discretion, and the excess, if any, shall be calculated on paid to Mortgagor, (B) exercise any and all rights and remedies of a simplesecured party under any applicable Uniform Commercial Code, non-compounded interest basis based solely on contributions made to or (C) exercise any other remedies available at law or in equity. No such use or application of the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to funds contained in the Replacement Reserve Reserves shall be retained by Mortgagee and accumulated for the benefit deemed to cure any Default or Event of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursedDefault.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 1,479.24 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor 7.1 Tenant shall pay to MortgageeLandlord, each month during the Term, the sum of $2,583.33/month ($31,000/year) (the "Replacement Reserve Installment"), which is the amount to be deposited by Landlord in a fund (the "Replacement Reserve Fund") to be utilized for capital improvements and repairs to the Facility, under the terms of the "Reserve Fund For Replacement" requirements of the U.S. Department of Housing and Urban Development ("HUD") pursuant to the existing Mortgage applicable to the Facility, which is HUD-insured under Section 232 of the National Housing Act. If a new Mortgage (or Mortgages) should be granted by Landlord, in addition accordance with Section 21 below, and the terms of such new Mortgage(s) require Landlord to make greater payments to a Replacement Reserve Fund or similar fund than the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to amount of the Replacement Reserve in an amount equal Installment described above, the Replacement Reserve Installments due from Tenant shall be increased to $1,163 per month. So long as no Default or Event of Default has occurred and is continuing, Mortgagee shall, conform to the extent requirements of such new Mortgage(s); provided, that Replacement Reserve Installments which Tenant is required to pay under this Lease shall not exceed the initial Replacement Reserve Installment amount stated above by more than ten percent (10%). 7.2 Landlord shall deposit the Replacement Reserve Installments received from Tenant into the Replacement Reserve Fund in accordance with the requirements of HUD and Landlord's Mortgage. Landlord shall make the Replacement Reserve Fund (both the balance of such fund as of the Commencement Date and additions thereto from the Replacement Reserve Installments paid by Tenant) available to Tenant for reimbursement of amounts spent by Tenant for capital improvements and repairs, in accordance with the standards utilized by HUD for release of funds are from a Reserve Fund For Replacement as set out in Chapter 4 of HUD Handbook 4350.01 Rev-1 ("Multifamily Asset Management And Project Servicing", September, 1992)(hereafter referred to as the "HUD Standards"). Promptly upon Landlord's receipt of a request from Tenant for reimbursement from the Replacement Reserve Fund ("Draw Request"), Landlord shall submit a request to Landlord's Mortgagee for the release of such funds, and shall use its best efforts to cause the mortgagee and HUD to approve the Draw Request. Upon HUD's approval of the Draw Request, Landlord shall make funds available to Tenant within five Business Days of Landlord's receipt of the funds. 7.3 If the Facility is subject to a Mortgage which is not HUD-insured, but the terms of the Mortgage require that a fund similar to a Replacement Reserve Fund ("Mortgagee Reserve Fund") be held under the control of the Mortgagee, Tenant shall submit Draw Requests, and Landlord shall make funds available to Tenant, in accordance with the standards of the Mortgagee, which shall be commercially reasonable. Upon approval of a Tenant Draw Request by the Mortgagee, Landlord shall make funds available to Tenant within five Business Days of Landlord's receipt of the funds from the Mortgagee. 7.4 If the Facility is not subject to a Mortgage which requires that a Replacement Reserve Fund or Mortgagee Reserve Fund, the Replacement Reserve Installments shall be held in a segregated federally-insured bank account to be controlled by Landlord to be used solely for holding Replacement Reserve Installments under this Lease (with, at Landlord's discretion, similar payments from one or more of the Affiliated Tenants pursuant to the Other Leases) (such purpose account, the "Reserve Account"). Funds in the Replacement ReserveReserve Account shall be the property of Tenant, disburse subject to Mortgagor the amount paid or incurred by Mortgagor condition that such funds may not be used for any purpose other than reimbursement of Tenant for improvements to the Leased Property pursuant to this Lease and the HUD Standards. Tenant shall submit Draw Requests to Landlord for reimbursement from the Reserve Account in performing Replacements accordance with the HUD Standards, and Landlord shall make funds from the Reserve Account available to Tenant within ten (10) days following: Business Days of Landlord's receipt of Tenant's Draw Request (aincluding supporting documentation) in accordance with the receipt HUD Standards. 7.5 All interest earned on the funds paid by Mortgagee of a written request from Mortgagor for disbursement from Tenant under this Section 7 shall be added to the Replacement Reserve Fund, Mortgagee Reserve Fund, or Reserve Fund, as applicable, and a certification by Mortgagor in a form approved in writing by Mortgagee that shall be reported for tax purposes as income of Tenant. At the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion end of the Replacements Lease Term, any funds remaining in the Replacement Reserve Fund, Mortgagee Reserve Fund or Reserve Account shall become the property of Landlord. Tenant's obligations to maintain the Leased Premises as provided in Section 11 below, to make capital improvements as provided in Section 24 below, and the value of the completed Replacements; to replace Equipment and (e) for disbursement requests Supplies as provided in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee Section 29 below shall not be required to make advances from conditioned upon the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability availability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Fund, Mortgagee Reserve Fund, or its servicing agent Reserve Account for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursedpurposes.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor 7.1 Tenant shall pay to MortgageeLandlord, each month during the Term, the sum of $2,475.00/month ($29,700/year) (the "Replacement Reserve Installment"), which is the amount to be deposited by Landlord in a fund (the "Replacement Reserve Fund") to be utilized for capital improvements and repairs to the Facility, under the same terms as the "Reserve Fund For Replacement" requirements of the U.S. Department of Housing and Urban Development ("HUD") for properties subject to mortgages which are HUD-insured under Section 232 of the National Housing Act (the Facility is not now, but is expected in the future to be, subject to such a Mortgage). If a new Mortgage (or Mortgages) should be granted by Landlord, in addition accordance with Section 21 below, and the terms of such new Mortgage(s) require Landlord to make greater payments to a Replacement Reserve Fund or similar fund than the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to amount of the Replacement Reserve in an amount equal Installment described above, the Replacement Reserve Installments due from Tenant shall be increased to $1,163 per month. So long as no Default or Event of Default has occurred and is continuing, Mortgagee shall, conform to the extent requirements of such new Mortgage(s). 7.2 At such time as the Facility becomes subject to a HUD-insured Mortgage, Landlord shall deposit the Replacement Reserve Installments received from Tenant into a Replacement Reserve Fund in accordance with the requirements of HUD and Landlord's Mortgage. Landlord shall make the Replacement Reserve Fund (both the balance of such fund as of the Commencement Date and additions thereto from the Replacement Reserve Installments paid by Tenant) available to Tenant for reimbursement of amounts spent by Tenant for capital improvements and repairs, in accordance with the standards utilized by HUD for release of funds are from a Reserve Fund For Replacement as set out in Chapter 4 of HUD Handbook 4350.01 Rev-1 ("Multifamily Asset Management And Project Servicing", September, 1992)(hereafter referred to as the "HUD Standards"). Promptly upon Landlord's receipt of a request from Tenant for reimbursement from the Replacement Reserve Fund ("Draw Request"), Landlord shall submit a request to Landlord's Mortgagee for the release of such funds, and shall use its best efforts to cause the mortgagee and HUD to approve the Draw Request. Upon HUD's approval of the Draw Request, Landlord shall make funds available to Tenant within five Business Days of Landlord's receipt of the funds. 7.3 If the Facility is subject to a Mortgage which is not HUD-insured, but the terms of the Mortgage require that a fund similar to a Replacement Reserve Fund ("Mortgagee Reserve Fund") be held under the control of the Mortgagee, Tenant shall submit Draw Requests, and Landlord shall make funds available to Tenant, in accordance with the standards of the Mortgagee, which shall be commercially reasonable. Upon approval of a Tenant Draw Request by the Mortgagee, Landlord shall make funds available to Tenant within five Business Days of Landlord's receipt of the funds from the Mortgagee. 7.4 If the Facility is not subject to a Mortgage which requires that a Replacement Reserve Fund or Mortgagee Reserve Fund, the Replacement Reserve Installments shall be held in a segregated federally-insured bank account to be controlled by Landlord to be used solely for holding Replacement Reserve Installments under this Lease (with, at Landlord's discretion, similar payments from one or more of the Affiliated Tenants pursuant to the Other Leases) (such purpose account, the "Reserve Account"). Funds in the Replacement ReserveReserve Account shall be the property of Tenant, disburse subject to Mortgagor the amount paid or incurred by Mortgagor condition that such funds may not be used for any purpose other than reimbursement of Tenant for improvements to the Leased Property pursuant to this Lease and the HUD Standards. Tenant shall submit Draw Requests to Landlord for reimbursement from the Reserve Account in performing Replacements accordance with the HUD Standards, and Landlord shall make funds from the Reserve Account available to Tenant within ten (10) days following: Business Days of Landlord's receipt of Tenant's Draw Request (aincluding supporting documentation) in accordance with the receipt HUD Standards. 7.5 All interest earned on the funds paid by Mortgagee of a written request from Mortgagor for disbursement from Tenant under this Section 7 shall be added to the Replacement Reserve Fund, Mortgagee Reserve Fund, or Reserve Fund, as applicable, and a certification by Mortgagor in a form approved in writing by Mortgagee that shall be reported for tax purposes as income of Tenant. At the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion end of the Replacements Lease Term, any funds remaining in the Replacement Reserve Fund, Mortgagee Reserve Fund or Reserve Account shall become the property of Landlord. Tenant's obligations to maintain the Leased Premises as provided in Section 11 below, to make capital improvements as provided in Section 24 below, and the value of the completed Replacements; to replace Equipment and (e) for disbursement requests Supplies as provided in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee Section 29 below shall not be required to make advances from conditioned upon the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability availability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Fund, Mortgagee Reserve Fund, or its servicing agent Reserve Account for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursedpurposes.

Replacement Reserve. In addition to any other construction, renovation and maintenance requirements set forth in this Agreement, commencing with the first Loan Year, Borrower shall expend at least $250 per unit per year (aexclusive of Insurance Proceeds) As additional security for on maintenance of the DebtProject. To the extent Borrower does not provide evidence, Mortgagor reasonably satisfactory to Lender, that Borrower has spent such sum on a cumulative annual basis, Borrower shall establish and maintain at all times while this Mortgage continues pay Lender such amount not spent. Lender shall hold such sum in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and Borrower’s use to fund future maintenance expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 per month. So long as no Default or Event of Default after Borrower has occurred and is continuing, Mortgagee shall, to the extent funds are available for such purpose spent in the Replacement Reserve, disburse to Mortgagor aggregate at least $74,250 on maintenance of the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) Project during the receipt by Mortgagee of a written then current Loan Year. Each request from Mortgagor for disbursement from the Replacement Reserve shall include copies of invoices for all items or materials purchased and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item all contracted labor or services provided, waivers of Replacement has been completed; (b) the delivery to Mortgagee of invoiceslien from each contractor providing materials, receipts labor or services, and other evidence satisfactory to Mortgagee, verifying the cost Lender of performing the Replacements; (c) for disbursement requests in excess payment of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens such amounts and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of such maintenance to the Replacements and the value of the completed Replacements; and (e) for disbursement requests Project. Borrower hereby grants Lender a first priority security interest in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee all funds contained therein and all products and proceeds thereof and all such funds are pledged as additional collateral for the Loan and Borrower shall be entitled execute any other documents and take any other actions reasonably necessary to rely on provide Lender with such request from Mortgagor without a perfected security interest in such funds. Upon the Maturity Date or at any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or time following an Event of Default shall have occurred and is continuing. In Default, the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds moneys then remaining in the Replacement Reserve to shall, at Lender’s option, be deposited into interest bearing accounts of applied against the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then availableIndebtedness. Interest payable on such amounts shall be computed based on the daily outstanding balance All sums held in the Replacement ReserveReserve may be commingled with other borrower reserves held by Lender, and shall not be deemed to be held in trust for the benefit of Borrower. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the The Replacement Reserve shall be retained maintained at a financial institution designated by Mortgagee Lender from time to time, in its sole and accumulated for absolute discretion (so long as such institution’s deposits are insured by the benefit of Mortgagor and added to the balance in the Replacement Reserve Federal Deposit Insurance Corporation), and shall be disbursed for under the sole dominion and control of Lender, and Borrower shall have no right to control or direct the investment of payment of the items for which other funds in the Replacement Reserve are to be disbursedtherein.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 647.93 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage Deed of Trust continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 5,002.67 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage Deed of Trust an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As The Trust Property is currently managed by Promus Hotels, Inc. ("Promus"), pursuant to that Management Agreement dated November 29, 1999, between Promus and Apple Suites Management, Inc. (the "Promus Management Agreement"). If the Promus Management Agreement is terminated, then, as additional security for the Debt, Mortgagor Grantor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair and replacement reserve (the “"Replacement Reserve”") with Mortgagee Beneficiary for payment of costs and expenses incurred by Mortgagor Grantor in connection with the repair, replacement and maintenance of the furniture, fixtures and equipment at the Trust Property and the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, carpets, appliances, fixtures, furnishings, elevators and mechanical and HVAC equipment (collectively, the “Replacements”"Repairs"). Commencing The Replacement Reserve shall be maintained for so long as this Deed of Trust continues in effect after the termination of the Promus Management Agreement; provided, however, no monthly deposits will be required to the Replacement Reserve if and for so long as the Trust Property is managed pursuant to a Management Agreement (as hereinafter defined) subsequently entered into in accordance with the provisions of Section 1.30 hereof. If deposits to the Replacement Reserve are required hereunder, deposits shall be made on the first each monthly Payment Date under the Note Note, concurrently with and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment payments due under the Note and until the Debt is fully paid and performed, a deposit Note. Deposits to the Replacement Reserve Reserve, when required, shall be in an amount equal to $1,163 per monthfive percent (5.0%) of the gross revenues of the Trust Property based upon the most recent annual balance sheets and statement of operations for the Trust Property. Notwithstanding the foregoing, if a Management Agreement reserves funds for Repairs in an amount less than five percent (5%) of the gross revenues of the Trust Property as calculated above, then a Replacement Reserve deposit shall be required in an amount equal to the difference between such Management Agreement reserve percentage and five percent (5%) of the gross revenues of the Property as calculated above. So long as no Default or Event of Default has occurred and is continuing, Mortgagee Beneficiary shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Grantor the amount paid or incurred by Mortgagor Grantor in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Beneficiary of a written request from Mortgagor Grantor for disbursement from the Replacement Reserve and a certification by Mortgagor Grantor in a form reasonably approved in writing by Mortgagee Beneficiary that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Beneficiary of invoices, receipts or other evidence reasonably satisfactory to MortgageeBeneficiary, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Beneficiary of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Beneficiary showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Trust Property have been paid all amounts due for labor and materials furnished to the Mortgaged Trust Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Beneficiary of a certification from an inspecting architect or other third party acceptable to Mortgagee Beneficiary describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Beneficiary of a new certificate of occupancy or local equivalent for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Grantor that no new certificate of occupancy is required. Mortgagee Beneficiary shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty ninety (6090) day period. In making any payment from the Replacement Reserve, Mortgagee Beneficiary shall be entitled to rely on such request from Mortgagor Grantor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Beneficiary may, at Mortgagor’s Grantor's expense, make or cause to be made during the term of this Mortgage ▇▇▇▇ ▇eed of Trust an annual inspection of the Mortgaged Trust Property to determine the need, as determined by Mortgagee Beneficiary in its reasonable judgment, for further Replacements Repairs of the Mortgaged Trust Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Trust Property are required, Mortgagee Beneficiary shall provide Mortgagor Grantor with a written description of the required Replacements Repairs and Mortgagor Grantor shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Beneficiary within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeBeneficiary, or such later date as may be approved by Mortgagee Beneficiary in its sole reasonable discretion. Interest on the funds contained in the Replacement Reserve shall be credited to Grantor as provided in Section 4.32 hereof. (b) Mortgagee As additional security for the payment and performance by Grantor of all duties, responsibilities and obligations under the Note and the other Loan Documents, Grantor hereby unconditionally and irrevocably assigns, conveys, pledges, mortgages, transfers, delivers, deposits, sets over and confirms unto Beneficiary, and hereby grants to Beneficiary a security interest in Grantor's right, title and interest in, (i) the Impound Account and the Replacement Reserve (as hereinafter defined) and any other reserve or escrow account established pursuant to the terms hereof or of any other Loan Document (collectively, the "Reserves"), (ii) the accounts into which the Reserves have been deposited, (iii) all insurance on said accounts, (iv) all accounts, contract rights and general intangibles or other rights and interests pertaining thereto, (v) all sums now or hereafter therein or represented thereby, (vi) all replacements, substitutions or proceeds thereof, (vii) all instruments and documents now or hereafter evidencing the Reserves or such accounts, (viii) all powers, options, rights, privileges and immunities pertaining to the Reserves (including the right to make withdrawals therefrom), and (ix) all proceeds of the foregoing. Grantor hereby authorizes and consents to the account into which the Reserves have been deposited being held in Beneficiary's name or the name of any entity servicing the Note for Beneficiary and hereby acknowledges and agrees that Beneficiary, or at Beneficiary's election, such servicing agent, shall cause have exclusive control over said account. Notice of the assignment and security interest granted to Beneficiary herein may be delivered by Beneficiary at any time to the financial institution wherein the Reserves have been established, and Beneficiary, or such servicing entity, shall have possession of all passbooks or other evidences of such accounts. Grantor hereby assumes all risk of loss with respect to amounts on deposit in the Reserves, unless finally determined by a court of competent jurisdiction to have been caused by the gross negligence or willful misconduct of Beneficiary. Grantor hereby knowingly, voluntarily and intentionally stipulates, acknowledges and agrees that the advancement of the funds from the Reserves as set forth herein is at Grantor's direction and is not the exercise by Beneficiary of any right of set-off or other remedy upon a Default or an Event of Default. If an Event of Default shall occur hereunder or under any other of the Loan Documents and shall be continuing, Beneficiary may, without notice or demand on Grantor, at its option: (A) withdraw any or all of the funds (including, without limitation, interest) then remaining in the Reserves and apply the same, after deducting all costs and expenses of safekeeping, collection and delivery (including, but not limited to, reasonable attorneys' fees, costs and expenses) to the Debt or any other obligations of Grantor under the other Loan Documents in such manner as Beneficiary shall deem appropriate in its sole discretion, and the excess, if any, shall be paid to Grantor, (B) exercise any and all rights and remedies of a secured party under any applicable Uniform Commercial Code, or (C) exercise any other remedies available at law or in equity. No such use or application of the funds contained in the Reserves shall be deemed to cure any Default or Event of Default. (c) The Reserves shall not, unless otherwise explicitly required by applicable law, be or be deemed to be escrow or trust funds, but, at Beneficiary's option and in Beneficiary's discretion, may either be held in a separate account or be commingled by Beneficiary with the general funds of Beneficiary. The Reserves are solely for the protection of Beneficiary and entail no responsibility on Beneficiary's part beyond the payment of the respective items for which they are held following receipt of bills, invoices or statements therefor in accordance with the terms hereof and beyond the allowing of due credit for the sums actually received. Upon assignment of this Deed of Trust by Beneficiary and assumption by assignee of Beneficiary's obligations hereunder, any funds in the Replacement Reserves shall be turned over to the assignee and any responsibility of Beneficiary, as assignor, with respect thereto shall terminate. If the funds in the applicable Reserve shall exceed the amount of payments actually applied by Beneficiary for the purposes and items for which the applicable Reserve is held, such excess may be credited by Beneficiary on subsequent payments to be made hereunder or, at the option of Beneficiary, refunded to Grantor. If, however, the applicable Reserve shall not contain sufficient funds to pay the sums required by the dates on which such sums are required to be on deposit in such account, Grantor shall, within thirty (30) days after receipt of written notice thereof, deposit with Beneficiary the full amount of any such deficiency. If Grantor shall fail to deposit with Beneficiary the full amount of such deficiency as provided above, Beneficiary shall have the option, but not the obligation, to make such deposit, and all amounts so deposited into by Beneficiary, together with interest bearing accounts of thereon at the type customarily maintained Default Interest Rate from the date so deposited by Mortgagee or its servicing agent for the investment of similar reservesBeneficiary until actually paid by Grantor, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based immediately paid by Grantor on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve demand and shall be disbursed for secured by this Deed of Trust and by all of the other Loan Documents securing all or any part of the Debt. If there is an Event of Default under this Deed of Trust that shall have occurred and be continuing, Beneficiary may, but shall not be obligated to, apply at any time the balance then remaining in any or all of the Reserves against the Debt in whatever order Beneficiary shall subjectively determine. No such application of any or all of the Reserves shall be deemed to cure any Event of Default. Upon full payment of the items for which Debt in accordance with its terms or at such earlier time as Beneficiary may elect, the balance of any or all of the Reserves then in Beneficiary's possession shall be paid over to Grantor and no other funds in the Replacement Reserve are to be disbursedparty shall have any right or claim thereto.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage Deed of Trust continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing with First Payment Date (as defined in the Note) and continuing thereafter on the first each monthly Payment Date under the Note and continuing on each Payment Date thereafterNote, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 1,833.83 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage Deed of Trust an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. Repair Escrow (a) As Lender has this day established an interest bearing reserve account at a federally insured institution (the "Replacement Reserve"), the balance of which shall be maintained and disbursed in accordance with the Replacement Reserve Agreement dated as of the date hereof between Borrower and Lender (the "Replacement Agreement"). Borrower shall deposit with Lender, on the first day of each calendar month during any given fiscal year, an amount equal to one-twelfth of four (4%) percent of the gross income derived from the Mortgaged Property during the preceding fiscal year. For the remaining portion of Borrower's current fiscal year, Borrower shall deposit $37,246.00 monthly into the Replacement Reserve. Notwithstanding anything to the contrary in this Section, in no event shall the monthly payments in respect of the Replacement Reserve ever fall below $37,246.00 as more particularly set forth in the Replacement Agreement. Borrower hereby pledges to Lender any and all monies now or hereafter deposited in the Replacement Reserve as additional security for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”)Debt. Commencing All earnings or interest on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 per month. So long as no Default or Event of Default has occurred and is continuing, Mortgagee shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt become part of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed as provided in the Replacement Agreement and in this Section. (b) Borrower has this day deposited with Lender, and Lender has this day established, an interest bearing escrow account at a federally insured institution the sum of $1,583,000.00 (the "Repair Escrow") to be maintained and disbursed in accordance with the Repair Escrow Agreement dated as of the date hereof between Borrower and Lender (the "Repair Agreement"). Borrower shall deposit with Lender, on or before August 1, 1996, an additional $1,583,000.00 for deposit by Lender into the Repair Escrow. Borrower hereby pledges to Lender any and all monies now or hereafter deposited in the Repair Escrow as additional security for the payment of the items for which other funds Debt. All earnings or interest on the Repair Escrow shall be and become part of such Repair Escrow and shall be disbursed as provided in the Replacement Reserve Repair Agreement and in this Section. (c) Funds on deposit with Lender shall be invested in direct obligations of, or obligations fully guaranteed as to payment of principal and interest by, the United States or any agency or instrumentality thereof, provided that such obligations are backed by the full faith and credit of the United States of America, and are fully FDIC-insured demand and time deposits. Lender shall exercise best efforts to be disburseddirect such investments to obtain for Borrower the highest rate of return, given the amounts available for investment and Borrower's timing requirements as communicated to Lender for access to the funds.

Replacement Reserve. Borrowers shall deposit with Administrative Agent on each Payment Date the product of Twenty-Five Dollars (a$25.00) As additional security multiplied by the number of Senior Housing Units in the Borrowing Base Assets, which shall be held by Administrative Agent or its servicer for replacements and repairs required to be made to the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement reserve Borrowing Base Assets during the term of the Loan (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “ReplacementsEscrow Fund”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 per month. So long as no Default or Event of Default has occurred and is continuingexists hereunder, Mortgagee shall, Administrative Agent shall credit for Borrowers’ account interest at the interest rate actually available to Administrative Agent’s servicer on the extent funds are available for held in such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the needaccount, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee Administrative Agent in its sole discretion. (b) Mortgagee shall cause funds . Borrowers hereby pledge to Administrative Agent for the benefit of the Lenders, and grant a security interest in, any and all monies now or hereafter deposited in the Replacement Reserve Escrow Fund as additional security for the payment of the Loan. Administrative Agent may reasonably reassess its estimate of the amount necessary for the Replacement Escrow Fund from time to time and may adjust the monthly amounts required to be deposited into interest bearing accounts the Replacement Escrow Fund upon thirty (30) days notice to Borrowers. Administrative Agent shall make disbursements from the Replacement Escrow Fund as requested by Borrowers, and approved by Administrative Agent in DAL:0535130/00080:1910701v7 its reasonable discretion, on a quarterly basis in increments of no less than $5,000.00 upon delivery by Borrowers of Administrative Agent’s standard form of draw request accompanied by copies of paid invoices for the amounts requested and, if required by Administrative Agent for any draw request for an invoice exceeding $15,000.00, lien waivers and releases from all parties furnishing materials and/or services in connection with the requested payment. Administrative Agent may require an inspection of the type customarily maintained by Mortgagee or its servicing agent Borrowing Base Assets at Borrowers’ expense prior to making a quarterly disbursement in order to verify completion of replacements and repairs for the investment of similar reserves, which accounts may not yield the highest interest rate then availablereimbursement is sought. Interest payable on such amounts The Replacement Escrow Fund shall be computed based on held without interest in Administrative Agent’s name and may be commingled with Administrative Agent’s general funds at financial institutions selected by Administrative Agent in its reasonable discretion. Upon the daily outstanding balance occurrence of an Event of Default, Administrative Agent may apply any sums then present in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made Escrow Fund to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items Loan in any order in its reasonable discretion. Until expended or applied as above provided, the Replacement Escrow Fund shall constitute additional security for which other funds the Loan. Administrative Agent shall have no obligation to release any of the Replacement Escrow Fund while any Event of Default or Default exists. All costs and expenses incurred by Administrative Agent in the disbursement of any of the Replacement Reserve are to Escrow Fund shall be disbursedpaid by Borrowers promptly upon demand or, at Administrative Agent’s sole discretion, deducted from the Replacement Escrow Fund.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage Deed of Trust continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 7,125 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage Deed of Trust an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage Deed of Trust continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 5,125.00 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage Deed of Trust an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 2,020.08 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor 7.1 Tenant shall pay to MortgageeLandlord, each month during the Term, the sum of $2,137.50/month ($25,650/year) (the "Replacement Reserve Installment"), which is the amount to be deposited by Landlord in a fund (the "Replacement Reserve Fund") to be utilized for capital improvements and repairs to the Facility, under the terms of the "Reserve Fund For Replacement" requirements of the U.S. Department of Housing and Urban Development ("HUD") pursuant to the existing Mortgage applicable to the Facility, which is HUD-insured under Section 232 of the National Housing Act. If a new Mortgage (or Mortgages) should be granted by Landlord, in addition accordance with Section 21 below, and the terms of such new Mortgage(s) require Landlord to make greater payments to a Replacement Reserve Fund or similar fund than the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to amount of the Replacement Reserve in an amount equal Installment described above, the Replacement Reserve Installments due from Tenant shall be increased to $1,163 per month. So long as no Default or Event of Default has occurred and is continuing, Mortgagee shall, conform to the extent requirements of such new Mortgage(s); provided, that Replacement Reserve Installments which Tenant is required to pay under this Lease shall not exceed the initial Replacement Reserve Installment amount stated above by more than ten percent (10%). 7.2 Landlord shall deposit the Replacement Reserve Installments received from Tenant into the Replacement Reserve Fund in accordance with the requirements of HUD and Landlord's Mortgage. Landlord shall make the Replacement Reserve Fund (both the balance of such fund as of the Commencement Date and additions thereto from the Replacement Reserve Installments paid by Tenant) available to Tenant for reimbursement of amounts spent by Tenant for capital improvements and repairs, in accordance with the standards utilized by HUD for release of funds are from a Reserve Fund For Replacement as set out in Chapter 4 of HUD Handbook 4350.01 Rev-1 ("Multifamily Asset Management And Project Servicing", September, 1992)(hereafter referred to as the "HUD Standards"). Promptly upon Landlord's receipt of a request from Tenant for reimbursement from the Replacement Reserve Fund ("Draw Request"), Landlord shall submit a request to Landlord's Mortgagee for the release of such funds, and shall use its best efforts to cause the mortgagee and HUD to approve the Draw Request. Upon HUD's approval of the Draw Request, Landlord shall make funds available to Tenant within five Business Days of Landlord's receipt of the funds. 7.3 If the Facility is subject to a Mortgage which is not HUD-insured, but the terms of the Mortgage require that a fund similar to a Replacement Reserve Fund ("Mortgagee Reserve Fund") be held under the control of the Mortgagee, Tenant shall submit Draw Requests, and Landlord shall make funds available to Tenant, in accordance with the standards of the Mortgagee, which shall be commercially reasonable. Upon approval of a Tenant Draw Request by the Mortgagee, Landlord shall make funds available to Tenant within five Business Days of Landlord's receipt of the funds from the Mortgagee. 7.4 If the Facility is not subject to a Mortgage which requires that a Replacement Reserve Fund or Mortgagee Reserve Fund, the Replacement Reserve Installments shall be held in a segregated federally-insured bank account to be controlled by Landlord to be used solely for holding Replacement Reserve Installments under this Lease (with, at Landlord's discretion, similar payments from one or more of the Affiliated Tenants pursuant to the Other Leases) (such purpose account, the "Reserve Account"). Funds in the Replacement ReserveReserve Account shall be the property of Tenant, disburse subject to Mortgagor the amount paid or incurred by Mortgagor condition that such funds may not be used for any purpose other than reimbursement of Tenant for improvements to the Leased Property pursuant to this Lease and the HUD Standards. Tenant shall submit Draw Requests to Landlord for reimbursement from the Reserve Account in performing Replacements accordance with the HUD Standards, and Landlord shall make funds from the Reserve Account available to Tenant within ten (10) days following: Business Days of Landlord's receipt of Tenant's Draw Request (aincluding supporting documentation) in accordance with the receipt HUD Standards. 7.5 All interest earned on the funds paid by Mortgagee of a written request from Mortgagor for disbursement from Tenant under this Section 7 shall be added to the Replacement Reserve Fund, Mortgagee Reserve Fund, or Reserve Fund, as applicable, and a certification by Mortgagor in a form approved in writing by Mortgagee that shall be reported for tax purposes as income of Tenant. At the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion end of the Replacements Lease Term, any funds remaining in the Replacement Reserve Fund, Mortgagee Reserve Fund or Reserve Account shall become the property of Landlord. Tenant's obligations to maintain the Leased Premises as provided in Section 11 below, to make capital improvements as provided in Section 24 below, and the value of the completed Replacements; to replace Equipment and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is requiredSupplies as provided in. Mortgagee Section 29 below shall not be required to make advances from conditioned upon the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability availability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Fund, Mortgagee Reserve Fund, or its servicing agent Reserve Account for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursedpurposes.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair reserve (the “"Replacement Reserve”") with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “Replacements”"Repairs"). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor shall pay to Mortgagee, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 4,388.49 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Mortgagee in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00010,000.00, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00010,000.00, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00010,000.00, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s 's expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements Repairs and Mortgagor shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee within one hundred twenty ninety (12090) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. Interest on the funds contained in the Replacement Reserve shall be credited to Mortgagor as provided in Section 4.31 hereof. (b) As additional security for the payment and performance by Mortgagor of all duties, responsibilities and obligations under the Note and the other Loan Documents, Mortgagor hereby unconditionally and irrevocably assigns, conveys, pledges, mortgages, transfers, delivers, deposits, sets over and confirms unto Mortgagee, and hereby grants to Mortgagee a security interest in, (i) the Impound Account, the Replacement Reserve, the Repair and Remediation Reserve (as hereinafter defined) and any other reserve or escrow account established pursuant to the terms hereof or of any other Loan Document (collectively, the "Reserves"), (ii) the accounts into which the Reserves have been deposited, (iii) all insurance on said accounts, (iv) all accounts, contract rights and general intangibles or other rights and interests pertaining thereto, (v) all sums now or hereafter therein or represented thereby, (vi) all replacements, substitutions or proceeds thereof, (vii) all instruments and documents now or hereafter evidencing the Reserves or such accounts, (viii) all powers, options, rights, privileges and immunities pertaining to the Reserves (including the right to make withdrawals therefrom), and (ix) all proceeds of the foregoing. Mortgagor hereby authorizes and consents to the account into which the Reserves have been deposited being held in Mortgagee's name or the name of any entity servicing the Note for Mortgagee and hereby acknowledges and agrees that Mortgagee, or at Mortgagee's election, such servicing agent, shall have exclusive control over said account. Notice of the assignment and security interest granted to Mortgagee herein may be delivered by Mortgagee at any time to the financial institution wherein the Reserves have been established, and Mortgagee, or such servicing entity, shall have possession of all passbooks or other evidences of such accounts. Mortgagor hereby assumes all risk of loss with respect to amounts on deposit in the Reserves. Mortgagor hereby knowingly, voluntarily and intentionally stipulates, acknowledges and agrees that the advancement of the funds from the Reserves as set forth herein is at Mortgagor's direction and is not the exercise by Mortgagee of any right of set-off or other remedy upon a Default or an Event of Default. Mortgagor hereby waives all right to withdraw funds from the Reserves except as provided for in this Mortgage. If an Event of Default shall occur hereunder or under any other of the Loan Documents Mortgagee may, without notice or demand on Mortgagor, at its option: (A) withdraw any or all of the funds (including, without limitation, interest) then remaining in the Reserves and apply the same, after deducting all costs and expenses of safekeeping, collection and delivery (including, but not limited to, reasonable attorneys' fees, costs and expenses) to the Debt or any other obligations of Mortgagor under the other Loan Documents in such manner as Mortgagee shall cause deem appropriate in its sole discretion, and the excess, if any, shall be paid to Mortgagor, (B) exercise any and all rights and remedies of a secured party under any applicable Uniform Commercial Code, or (C) exercise any other remedies available at law or in equity. No such use or application of the funds contained in the Reserves shall be deemed to cure any Default or Event of Default. (c) The Reserves shall not, unless otherwise explicitly required by applicable law, be or be deemed to be escrow or trust funds, but, at Mortgagee's option and in Mortgagee's discretion, may either be held in a separate account or be commingled by Mortgagee with the general funds of Mortgagee. The Reserves are solely for the protection of Mortgagee and entail no responsibility on Mortgagee's part beyond the payment of the respective items for which they are held following receipt of bills, invoices or statements therefor in accordance with the terms hereof and beyond the allowing of due credit for the sums actually received. Upon assignment of this Mortgage by Mortgagee, any funds in the Replacement Reserves shall be turned over to the assignee and any responsibility of Mortgagee, as assignor, with respect thereto shall terminate. If the funds in the applicable Reserve shall exceed the amount of payments actually applied by Mortgagee for the purposes and items for which the applicable Reserve is held, such excess may be credited by Mortgagee on subsequent payments to be made hereunder or, at the option of Mortgagee, refunded to Mortgagor. If, however, the applicable Reserve shall not contain sufficient funds to pay the sums required by the dates on which such sums are required to be on deposit in such account, Mortgagor shall, within ten (10) days after receipt of written notice thereof, deposit with Mortgagee the full amount of any such deficiency. If Mortgagor shall fail to deposit with Mortgagee the full amount of such deficiency as provided above, Mortgagee shall have the option, but not the obligation, to make such deposit, and all amounts so deposited into by Mortgagee, together with interest bearing accounts of thereon at the type customarily maintained Default Interest Rate from the date so deposited by Mortgagee or its servicing agent for the investment of similar reservesuntil actually paid by Mortgagor, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based immediately paid by Mortgagor on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve demand and shall be disbursed for secured by this Mortgage and by all of the other Loan Documents securing all or any part of the Debt. If there is an Event of Default under this Mortgage, Mortgagee may, but shall not be obligated to, apply at any time the balance then remaining in any or all of the Reserves against the Debt in whatever order Mortgagee shall subjectively determine. No such application of any or all of the Reserves shall be deemed to cure any Event of Default. Upon full payment of the items for which Debt in accordance with its terms or at such earlier time as Mortgagee may elect, the balance of any or all of the Reserves then in Mortgagee's possession shall be paid over to Mortgagor and no other funds in the Replacement Reserve are to be disbursedparty shall have any right or claim thereto.

Replacement Reserve. Borrower shall deposit with Lender (or such agent of Lender as Lender may designate in writing from time to time): (a) As additional security at Closing, an amount equal to $28,125, and (b) on each Payment Date the amount of $4,410 for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect purpose of creating a reserve for capital improvement reserve items in accordance with the applicable Capital Expenditure Budget approved by Lender (said funds, together with any interest thereon and additions thereto, the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, The funds contained in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve shall be utilized by Borrower solely for capital improvements in an amount equal accordance with Capital Expenditure Budget approved annually in advance by Lender. Upon written application of Borrower (not more often than once per calendar quarter), Borrower shall be entitled to $1,163 per month. So long as draw upon the Replacement Reserve to pay for the costs of such capital improvements, provided that (i) no Default or Event of Default has occurred and is continuingcontinues without cure, Mortgagee shall(ii) Borrower shall provide to Lender such documentation and certifications as Lender may reasonably request to substantiate the requirement for and entitlement to such disbursement, (iii) Borrower shall provide Lender with all invoices, receipts, lien waivers and other documentation of lawful and workmanlike progress or completion and lien-free status requested by Lender, (iv) at the request of Lender, Borrower provides Lender either with (1) a search of title to the extent funds are available Property effective to the date of the draw, or (2) an endorsement to the Title Policy insuring Lender’ interest in the Property which updates the effective date of the Title Policy to the date of disbursement, which search or title endorsement shows that no mechanics’ or materialmen’s liens or other liens of any nature have been placed against the Property since the date of recordation of the Deed of Trust (other than liens which Borrower is contesting in accordance with Section 5.3) and that title to the Property is free and clear of all liens (other than Permitted Encumbrances), (v) at the request of Lender, Borrower has delivered, at Borrower’s expense, an inspection report by an appropriate independent qualified professional acceptable to Lender (and/or Lender has conducted its own inspection of the Property, at its discretion), and (vi) if estimated improvement costs at the Property exceed $50,000, Lender have approved the expenditures proposed by Borrower in advance. The Replacement Reserve shall not be used for such purpose any tenant improvements in connection with the Lender-approved Leases or for purposes for which any other Reserve is established. The insufficiency of any balance in the Replacement ReserveReserve shall not abrogate the Borrower’s agreement to fulfill all preservation and maintenance covenants in the Loan Documents. In the event that the sum to be disbursed by Lender to Borrower out of the Replacement Reserve is less than the current estimated cost to pay for the applicable capital improvement item in accordance with the applicable Capital Expenditure Budget most-recently approved by Lender, disburse to Mortgagor Borrower shall deposit the amount paid or incurred by Mortgagor in performing Replacements shortage within ten (10) days following: (a) the receipt of request by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuingLender. In the event Lender determines, in its reasonable discretion, from time to time and based on Lender’s inspections, that such inspection reveals that further Replacements the amount of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description monthly deposit is insufficient to fund the cost of likely capital improvement items and related contingencies that may arise during the remaining term of the required Replacements and Mortgagor shall complete such Replacements to Loan, Lender may require an increase in the reasonable satisfaction amount of Mortgagee within one hundred twenty the monthly deposits upon thirty (12030) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretionprior written notice to Borrower. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for At the Debt, Mortgagor shall establish time of and maintain at all times while this Mortgage continues in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment installments of interest, and if applicable, principal due under the Note and until the Debt is fully paid and performedthis Agreement, a deposit Borrowers shall pay to the Replacement Reserve in Lender an amount equal to the product of Thirty and No/100ths Dollars ($1,163 per month. So long as no Default or Event 30.00) multiplied by the number of Default has occurred and is continuing, Mortgagee shall, to the extent funds are available for such purpose beds in the Replacement Reserve, disburse to Mortgagor Projects (the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required"REPLACEMENT RESERVE"). Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds Funds in the Replacement Reserve will be held by a depository institution insured by the Federal Deposit Insurance Corporation (which institution may be an Affiliate of Lender), may be commingled with the general funds of Lender, and these sums shall not be deemed to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent held in trust for the investment benefit of similar reserves, which accounts may Borrower. Lender shall not yield the highest be obligated to pay interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance funds in the Replacement Reserve. Such interest shall On the Maturity Date, the monies then remaining on deposit with Lender shall, at Lender's option, be calculated on a simpleapplied against the Indebtedness or if no Event of Default is continuing, non-compounded interest basis based solely on contributions made returned to Borrower. So long as there is no continuing Event of Default, Borrower may request Lender to disburse funds from the Replacement Reserve (which request will include a reasonably detailed description of the capital expenditures at a Project which Borrower intends to pay for with such funds), which request shall not be unreasonably denied by MortgagorLender. All If requested by Lender, each disbursement request will be accompanied by copies of invoices, lien waivers and other evidence reasonably required by Lender. Borrower hereby grants Lender a first priority security interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee in such funds, including all interest accruing thereon, and accumulated all such funds are pledged as additional collateral for the benefit Loan and Borrower shall execute any other documents and take any other actions necessary to provide Lender with such a perfected security interest in such funds. Upon the Maturity Date or at any time following an Event of Mortgagor and added to Default, the balance in moneys then remaining on deposit with Lender or its agent shall, at Lender's option, be applied against the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursedIndebtedness.

Replacement Reserve. (a) As additional security for the Debtindebtedness secured hereby, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair reserve (the “"Replacement Reserve”) "), with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with capital improvements, repairs and replacements, including the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, carpets, appliances, fixtures, elevators and mechanical and HVAC equipment (collectively, collectively the “Replacements”"Repairs). Commencing on the first Payment Date monthly payment date under the Note and continuing thereafter on each Payment Date thereaftermonthly payment date under the Note, Mortgagor shall pay to Mortgagee, in addition to concurrently with the monthly payment due under the Note and until the Debt is fully paid and performedNote, a deposit to the Replacement Reserve in an amount equal to $1,163 per month517.83. So long as no Default default here under or Event of Default under the other Loan Documents has occurred and is continuing, (i) all sums in the Replacement Reserve shall be held by Mortgagee in the Replacement Reserve to pay the costs and expense of Repairs, and (ii) Mortgagee shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by to Mortgagee that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the ReplacementsRepairs; and (c) for disbursement requests (i) in excess of $25,00020,000.00 with respect to any single Repair, the or (ii) for any single Repair that is structural in nature, delivery to Mortgagee of (I) affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens Liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d2) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e3) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new (or amended) certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is was required by law, or a certification by Mortgagor that no new certificate of occupancy is requiredwas required by law. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once one time in any sixty (60) day periodcalendar month. In making malting any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense's expense (not to exceed $2,500.00 annually), make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements Repairs and Mortgagor shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee within one hundred twenty ninety (12090) days (subject to force maj eure) after the receipt of such description from MortgageeMortgag▇▇, or such later date as may be approved by Mortgagee in its sole reasonable discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based or other earnings on the daily outstanding balance funds contained in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of credited to Mortgagor and added to the balance as provided in Section 4.28 hereof in the Replacement Reserve and shall be disbursed for payment of event that the items for which other funds amounts on deposit or available in the Replacement Reserve are inadequate to be disbursedpay the cost of the Repairs, Mortgagor shall pay the amount of such deficiency.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor 7.1 Tenant shall pay to MortgageeLandlord, each month during the Term, the sum of $3,300.00/month ($39,600/year) (the "Replacement Reserve Installment"), which is the amount to be deposited by Landlord in a fund (the "Replacement Reserve Fund") to be utilized for capital improvements and repairs to the Facility, under the same terms as the "Reserve Fund For Replacement" requirements of the U.S. Department of Housing and Urban Development ("HUD") for properties subject to mortgages which are HUD-insured under Section 232 of the National Housing Act (the Facility is not subject to such a Mortgage). If a new Mortgage (or Mortgages) should be granted by Landlord, in addition accordance with Section 21 below, and the terms of such new Mortgage(s) require Landlord to make greater payments to a Replacement Reserve Fund or similar fund than the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to amount of the Replacement Reserve in an amount equal Installment described above, the Replacement Reserve Installments due from Tenant shall be increased to $1,163 per month. So long as no Default or Event of Default has occurred and is continuing, Mortgagee shall, conform to the extent requirements of such new Mortgage(s). 7.2 Landlord shall deposit the Replacement Reserve Installments received from Tenant into a Replacement Reserve Fund similar to the procedure used with HUD-insured mortgages. Landlord shall make the Replacement Reserve Fund (both the balance of such fund as of the Commencement Date and additions thereto from the Replacement Reserve Installments paid by Tenant) available to Tenant for reimbursement of amounts spent by Tenant for capital improvements and repairs, in accordance with the standards utilized by HUD for release of funds are available for such purpose from a Reserve Fund For Replacement as set out in Chapter 4 of HUD Handbook 4350.01 Rev-1 ("Multifamily Asset Management And Project Servicing", September, 1992)(hereafter referred to as the "HUD Standards"). If the Facility is subject to a Mortgage requiring Mortgagee approval of funds in the Replacement ReserveReserve Fund, disburse then promptly upon Landlord's receipt of a request from Tenant for reimbursement from the Replacement Reserve Fund ("Draw Request"), Landlord shall submit a request to Mortgagor Landlord's Mortgagee for the amount paid release of such funds, and shall use its best efforts to cause the mortgagee to approve the Draw Request. Upon receipt of the required Mortgagee approval of the Draw Request (if such approval is required), Landlord shall make funds available to Tenant within five Business Days of Landlord's receipt of the funds. 7.3 If the Facility is subject to a Mortgage which requires that a fund similar to a Replacement Reserve Fund ("Mortgagee Reserve Fund") be held under the control of the Mortgagee, Tenant shall submit Draw Requests, and Landlord shall make funds available to Tenant, in accordance with the standards of the Mortgagee, which shall be commercially reasonable. Upon approval of a Tenant Draw Request by the Mortgagee, Landlord shall make funds available to Tenant within five Business Days of Landlord's receipt of the funds from the Mortgagee. 7.4 If the Facility is not subject to a Mortgage which requires that a Replacement Reserve Fund or incurred Mortgagee Reserve Fund, the Replacement Reserve Installments shall be held in a segregated federally-insured bank account to be controlled by Mortgagor Landlord to be used solely for holding Replacement Reserve Installments under this Lease (with, at Landlord's discretion, similar payments from one or more of the Affiliated Tenants pursuant to the Other Leases) (such account, the "Reserve Account"). Funds in performing Replacements the Reserve Account shall be the property of Tenant, subject to the condition that such funds may not be used for any purpose other than reimbursement of Tenant for improvements to the Leased Property pursuant to this Lease and the HUD Standards. Tenant shall submit Draw Requests to Landlord for reimbursement from the Reserve Account in accordance with the HUD Standards, and Landlord shall make funds from the Reserve Account available to Tenant within ten (10) days following: Business Days of Landlord's receipt of Tenant's Draw Request (aincluding supporting documentation) in accordance with the receipt HUD Standards. 7.5 All interest earned on the funds paid by Mortgagee of a written request from Mortgagor for disbursement from Tenant under this Section 7 shall be added to the Replacement Reserve Fund, Mortgagee Reserve Fund, or Reserve Fund, as applicable, and a certification by Mortgagor in a form approved in writing by Mortgagee that shall be reported for tax purposes as income of Tenant. At the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion end of the Replacements Lease Term, any funds remaining in the Replacement Reserve Fund, Mortgagee Reserve Fund or Reserve Account shall become the property of Landlord. Tenant's obligations to maintain the Leased Premises as provided in Section 11 below, to make capital improvements as provided in Section 24 below, and the value of the completed Replacements; to replace Equipment and (e) for disbursement requests Supplies as provided in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee Section 29 below shall not be required to make advances from conditioned upon the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability availability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Fund, Mortgagee Reserve Fund, or its servicing agent Reserve Account for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursedpurposes.

Replacement Reserve. Borrowers shall deposit with Administrative Agent on each Payment Date the product of Twenty-Five Dollars (a$25.00) As additional security multiplied by the number of Senior Housing Units in the Borrowing Base Assets, which shall be held by Administrative Agent or its servicer for replacements and repairs required to be made to the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement reserve Borrowing Base Assets during the term of the Loan (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “ReplacementsEscrow Fund”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 per month. So long as no Default or Event of Default has occurred and is continuingexists hereunder, Mortgagee shall, Administrative Agent shall credit for Borrowers’ account interest at the interest rate actually available to Administrative Agent’s servicer on the extent funds are available for held in such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the needaccount, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee Administrative Agent in its sole discretion. (b) Mortgagee shall cause funds . Borrowers hereby pledge to Administrative Agent for the benefit of the Lenders, and grant a security interest in, any and all monies now or hereafter deposited in the Replacement Reserve Escrow Fund as additional security for the payment of the Loan. Administrative Agent may reasonably reassess its estimate of the amount necessary for the Replacement Escrow Fund from time to time and may adjust the monthly amounts required to be deposited into interest bearing accounts the Replacement Escrow Fund upon thirty (30) days notice to Borrowers. Administrative Agent shall make disbursements from the Replacement Escrow Fund as requested by Borrowers, and approved by Administrative Agent in its reasonable discretion, on a quarterly basis in increments of no less than $5,000.00 upon delivery by Borrowers of Administrative Agent’s standard form of draw request accompanied by copies of paid invoices for the amounts requested and, if required by Administrative Agent for any draw request for an invoice exceeding $15,000.00, lien waivers and releases from all parties furnishing materials and/or services in connection with the requested payment. Administrative Agent may require an inspection of the type customarily maintained by Mortgagee or its servicing agent Borrowing Base Assets at Borrowers’ expense prior to making a quarterly disbursement in order to verify completion of replacements and repairs for the investment of similar reserves, which accounts may not yield the highest interest rate then availablereimbursement is sought. Interest payable on such amounts The Replacement Escrow Fund shall be computed based on held without interest in Administrative Agent’s name and may be commingled with Administrative Agent’s general funds at financial institutions selected by Administrative Agent in its reasonable discretion. Upon the daily outstanding balance occurrence of an Event of Default, Administrative Agent may apply any sums then present in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made Escrow Fund to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items Loan in any order in its reasonable discretion. Until expended or applied as above provided, the Replacement Escrow Fund shall constitute additional security for which other funds the Loan. Administrative Agent shall have no obligation to release any of the Replacement Escrow Fund while any Event of Default or Default exists. All costs and expenses incurred by Administrative Agent in the disbursement of any of the Replacement Reserve are to Escrow Fund shall be disbursedpaid by Borrowers promptly upon demand or, at Administrative Agent’s sole discretion, deducted from the Replacement Escrow Fund.

Replacement Reserve. (a) As additional security for Borrower shall deposit, or cause to be deposited, $0.00 on the Debt, Mortgagor shall establish Closing Date and maintain at all times while this Mortgage continues in effect a capital improvement reserve $21,322.00 (the “"Replacement Reserve”Reserve Amount") with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to into the Replacement Reserve in an amount equal to $1,163 per monthAccount. So long as no Default or Event of Default has occurred and is continuing, Mortgagee shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the The Replacement Reserve Subaccount shall be maintained at Clearing Bank and a certification by Mortgagor proceeds therefrom shall be applied in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor accordance with this Mortgage. Provided that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuingbe continuing and no Cash Management Period has occurred, Lender shall make disbursements from the Replacement Reserve Subaccount to Borrower from time to time, but not more than once during each calendar month, upon delivery to Lender of evidence reasonably satisfactory to Lender that replacement and deferred maintenance items identified on Schedule 2 attached hereto or other replacement and deferred maintenance items reasonably approved by Lender have been completed, which work shall be subject to the reasonable inspection of Lender for compliance with the requirements of this Mortgage. In no event shall Lender be obligated to disburse funds from the event that such inspection reveals that further Replacements Replacement Reserve Subaccount if an Event of Default exists. Each request for disbursement from the Replacement Reserve Subaccount shall be in a form reasonably specified or reasonably approved by Lender and be submitted together with an Officer's Certificate specifying the specific items for which the disbursement is requested and the cost of each replacement and deferred maintenance item and updated title search against the Mortgaged Property are requireddisclosing no liens, Mortgagee shall provide Mortgagor with a written description charges or encumbrances other than Permitted Encumbrances at least ten (10) Business Days prior to the date of the required Replacements requested disbursement. Each request for disbursement shall include copies of invoices for all costs incurred and Mortgagor each request shall complete include evidence satisfactory to Lender of payment of all such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of amounts or an Officer's Certificate that such description amounts will be paid with such proceeds. Borrower shall not make a request for disbursement from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to Subaccount more frequently than once in any calendar month and the total amount of any request shall not be deposited into interest bearing accounts of less than $10,000 or a lesser amount if such disbursement will be the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in last disbursement from the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage Security Deed continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing on the first Payment Date and continuing thereafter on each monthly Payment Date under the Note and continuing on each Payment Date thereafterNote, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 1,916.18 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage Security Deed an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 3,522.03 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 1,264,26 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for At the Debt, Mortgagor shall establish time of and maintain at all times while this Mortgage continues in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment installments of interest, and if applicable, principal due under the Note and until the Debt is fully paid and performedthis Agreement, a deposit Borrowers shall pay to the Replacement Reserve in Lender an amount equal to the product of (i) One Hundred Twenty-Five Dollars ($1,163 per month. So long as no Default or Event 125.00) and (ii) the aggregate number of Default has occurred and is continuing, Mortgagee shall, to the extent funds are available for such purpose beds in the Replacement Reserve, disburse to Mortgagor Projects (the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required"REPLACEMENT RESERVE"). Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds Funds in the Replacement Reserve will be held by a depository institution insured by the Federal Deposit Insurance Corporation (which institution may be an Affiliate of Lender) in an interest-bearing account, may be commingled with the general funds of Lender, and these sums shall not be deemed to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance held in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated trust for the benefit of Mortgagor Borrowers. Interest shall accrue on the Replacement Reserve at the rate paid by such depository institution for such deposits. Any interest accruing and added paid on such funds shall be deemed to the balance in be part of the Replacement Reserve and shall be disbursed for payment applied in accordance with this Section 4.2(g). On the Maturity Date, the monies then remaining on deposit with Lender shall, at Lender's option, be applied against the Indebtedness or if no Event of the items for which other Default is continuing, returned to Borrowers. So long as there is no continuing Event of Default, Borrowers may request Lender to disburse funds in from the Replacement Reserve (which request will include (i) a reasonably detailed description of the capital expenditures at a Project which a Borrower intends to pay for with such funds and (ii) the written consent of the applicable Project Lessee, which request shall not be unreasonably denied by Lender. If requested by Lender, each disbursement request will be accompanied by copies of invoices, lien waivers and other evidence reasonably required by Lender. Borrowers hereby grant Lender a first priority security interest in such funds, including all interest accruing thereon, and all such funds are pledged as additional collateral for the Loan and Borrowers shall execute any other documents and take any other actions necessary to provide Lender with such a perfected security interest in such funds; provided, however, that if such funds are the deposited by one or more Project Lessees, Borrowers hereby assign to Lender Borrowers' security interest in such funds, including all interest accruing thereon, as additional collateral for the Loan and Borrowers shall execute any other documents and take any other actions necessary to provide Lender with an assignment of Borrower's security interest in such funds. Upon the Maturity Date or at any time following an Event of Default, the moneys then remaining on deposit with Lender or its agent shall, at Lender's option, be applied against the Indebtedness. The provisions of this Section 4.1(g) shall be deemed satisfied to the extent that the Project Lessees deposit with Lender, for application in the manner specified in this Section 4.1(g), the replacement reserve deposits required to be disbursedmade under the Project Leases.

Replacement Reserve. In addition to any other construction, renovation and maintenance requirements set forth in this Agreement, commencing with the first Loan Year, Borrower shall expend at least $250 per unit per year (aexclusive of Insurance Proceeds) As additional security for on maintenance of the DebtProject. To the extent Borrower does not provide evidence, Mortgagor reasonably satisfactory to Lender, that Borrower has spent such sum on a cumulative annual basis, Borrower shall establish and maintain at all times while this Mortgage continues pay Lender such amount not spent. Lender shall hold such sum in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and Borrower’s use to fund future maintenance expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 per month. So long as no Default or Event of Default after Borrower has occurred and is continuing, Mortgagee shall, to the extent funds are available for such purpose spent in the Replacement Reserve, disburse to Mortgagor aggregate at least $123,500 on maintenance of the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) Project during the receipt by Mortgagee of a written then current Loan Year. Each request from Mortgagor for disbursement from the Replacement Reserve shall include copies of invoices for all items or materials purchased and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item all contracted labor or services provided, waivers of Replacement has been completed; (b) the delivery to Mortgagee of invoiceslien from each contractor providing materials, receipts labor or services, and other evidence satisfactory to Mortgagee, verifying the cost Lender of performing the Replacements; (c) for disbursement requests in excess payment of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens such amounts and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of such maintenance to the Replacements and the value of the completed Replacements; and (e) for disbursement requests Project. Borrower hereby grants Lender a first priority security interest in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee all funds contained therein and all products and proceeds thereof and all such funds are pledged as additional collateral for the Loan and Borrower shall be entitled execute any other documents and take any other actions reasonably necessary to rely on provide Lender with such request from Mortgagor without a perfected security interest in such funds. Upon the Maturity Date or at any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or time following an Event of Default shall have occurred and is continuing. In Default, the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds moneys then remaining in the Replacement Reserve to shall, at Lender’s option, be deposited into interest bearing accounts of applied against the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then availableIndebtedness. Interest payable on such amounts shall be computed based on the daily outstanding balance All sums held in the Replacement ReserveReserve may be commingled with other borrower reserves held by Lender, and shall not be deemed to be held in trust for the benefit of Borrower. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the The Replacement Reserve shall be retained maintained at a financial institution designated by Mortgagee Lender from time to time, in its sole and accumulated for absolute discretion (so long as such institution’s deposits are insured by the benefit of Mortgagor and added to the balance in the Replacement Reserve Federal Deposit Insurance Corporation), and shall be disbursed for under the sole dominion and control of Lender, and Borrower shall have no right to control or direct the investment of payment of the items for which other funds in the Replacement Reserve are to be disbursedtherein.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage Security Deed continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 5,125.00 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage Security Deed an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Grantor shall establish and maintain at all times while this Mortgage Deed of Trust continues in effect a capital improvement repair and replacement reserve (the “"Replacement Reserve”") with Mortgagee Beneficiary for payment ------------------- of costs and expenses incurred by Mortgagor Grantor in connection with the performance of work which would normally be treated related to the maintenance, replacement and/or repair of the Trust Property, including without limitation, work to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment and such other work as a capital improvement under generally accepted accounting principles Grantor deems necessary or appropriate (collectively, the “Replacements”"Repairs"). Commencing on the first monthly Payment Date ------- under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Grantor shall pay to MortgageeBeneficiary, concurrently with and in addition to the monthly payment payments due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 5,916.67 per month. So long as no Event of Default has occurred and is continuing, all sums in the Replacement Reserve shall be held by Beneficiary in the Replacement Reserve to pay the costs and expense of Repairs. So long as no Default or Event of Default has occurred and is continuing, Mortgagee Beneficiary shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Grantor the amount paid or incurred by Mortgagor Grantor in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Beneficiary of a written request from Mortgagor Grantor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee Grantor that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Beneficiary of invoices, receipts receipts, cancelled checks or other evidence reasonably satisfactory to MortgageeBeneficiary, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests with individual items costing in excess of $25,00050,000.00, the delivery to Mortgagee Beneficiary of affidavits, lien waivers waivers, cancelled checks or other evidence reasonably satisfactory to Mortgagee Beneficiary showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Trust Property have been paid all amounts due for labor and materials furnished to the Mortgaged Trust Property; (d) for disbursement requests with individual items costing in excess of $25,00050,000.00, delivery to Mortgagee Beneficiary of a certification from an inspecting architect or other a third party acceptable to Mortgagee Beneficiary describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests with individual items costing in excess of $50,00050,000.00, delivery to Mortgagee Beneficiary of a new certificate of occupancy or local equivalent for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Grantor that no new certificate of occupancy is required. Mortgagee Beneficiary shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty ninety (6090) day period. In making any payment from the Replacement Reserve, Mortgagee Beneficiary shall be entitled to rely on such request from Mortgagor Grantor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Beneficiary may, at Mortgagor’s ▇▇▇▇▇▇▇'s expense, make or cause to be made during the term of this Mortgage Deed of Trust an annual inspection of the Mortgaged Trust Property to determine the need, as determined by Mortgagee Beneficiary in its reasonable judgment, for further Replacements Repairs of the Mortgaged Trust Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Trust Property are required, Mortgagee Beneficiary shall provide Mortgagor Grantor with a written description of the required Replacements Repairs and Mortgagor Grantor shall complete such Replacements to the reasonable satisfaction of Mortgagee respond within one hundred twenty thirty (12030) days after the receipt of such description from Mortgageerequest, or and, thereafter, Grantor shall make such later date Repairs, as may be approved mutually agreed upon by Mortgagee Grantor and Beneficiary and within such time period as may be mutually agreed upon. Funds contained in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee placed in an interest-bearing account upon receipt and accumulated interest thereon credited to Grantor as provided in Section 4.31 hereof. ------------ (b) As additional security for the benefit payment and performance by Grantor of Mortgagor all duties, responsibilities and added obligations under the Note and the other Loan Documents, Grantor hereby unconditionally and irrevocably assigns, conveys, pledges, mortgages, transfers, delivers, deposits, sets over and confirms unto Beneficiary, and hereby grants to Beneficiary a security interest in Grantor's right, title and interest in, (i) the balance in Impound Account, the Replacement Reserve and any other reserve or escrow account established pursuant to the terms hereof or of any other Loan Document (collectively, the "Reserves"), (ii) the accounts into which the Reserves have been deposited, -------- (iii) all insurance on said accounts, (iv) all accounts, contract rights and general intangibles or other rights and interests pertaining thereto, (v) all sums now or hereafter therein or represented thereby, (vi) all replacements, substitutions or proceeds thereof, (vii) all instruments and documents now or hereafter evidencing the Reserves or such accounts, (viii) all powers, options, rights, privileges and immunities pertaining to the Reserves (including the right to make withdrawals therefrom), and (ix) all proceeds of the foregoing. Grantor hereby authorizes and consents to the account into which the Reserves have been deposited being held in Beneficiary's name or the name of any entity servicing the Note for Beneficiary and hereby acknowledges and agrees that Beneficiary, or at Beneficiary's election, such servicing agent, shall have exclusive control over said account. Notice of the assignment and security interest granted to Beneficiary herein may be delivered by Beneficiary at any time to the financial institution wherein the Reserves have been established, and Beneficiary, or such servicing entity, shall have possession of all passbooks or other evidences of such accounts. Grantor hereby assumes all risk of loss with respect to amounts on deposit in the Reserves, unless finally determined by a court of competent jurisdiction to have been caused by the gross negligence or willful misconduct of Beneficiary. Grantor hereby knowingly, voluntarily and intentionally stipulates, acknowledges and agrees that the advancement of the funds from the Reserves as set forth herein is at Grantor's direction and is not the exercise by Beneficiary of any right of set-off or other remedy upon a Default or an Event of Default. If an Event of Default shall occur hereunder or under any other of the Loan Documents and shall be disbursed continuing, Beneficiary may, without notice or demand on Grantor, at its option: (A) withdraw any or all of the funds (including, without limitation, interest) then remaining in the Reserves and apply the same, after deducting all costs and expenses of safekeeping, collection and delivery (including, but not limited to, reasonable attorneys' fees, costs and expenses) to the Debt or any other obligations of Grantor under the other Loan Documents in such manner as Beneficiary shall deem appropriate in its sole discretion, and the excess, if any, shall be paid to Grantor, (B) exercise any and all rights and remedies of a secured party under any applicable Uniform Commercial Code, or (C) exercise any other remedies available at law or in equity. No such use or application of the funds contained in the Reserves shall be deemed to cure any Default or Event of Default. (c) The Reserves shall not, unless otherwise explicitly required by applicable law, be or be deemed to be escrow or trust funds, but, at Beneficiary's option and in Beneficiary's discretion, may either be held in a separate account or be commingled by Beneficiary with the general funds of Beneficiary. The Reserves are solely for the protection of Beneficiary and entail no responsibility on Beneficiary's part beyond the payment of the respective items for which other they are held following receipt of bills, invoices or statements therefor in accordance with the terms hereof and beyond the allowing of due credit for the sums actually received. Upon assignment of this Deed of Trust by Beneficiary and assumption by assignee of Beneficiary's obligations hereunder, any funds in the Replacement Reserves shall be turned over to the assignee and any responsibility of Beneficiary, as assignor, with respect thereto shall terminate. If the funds in the applicable Reserve are shall exceed the amount of payments actually applied by Beneficiary for the purposes and items for which the applicable Reserve is held, such excess may be credited by Beneficiary on subsequent payments to be disbursedmade hereunder or, at the option of Beneficiary, refunded to Grantor. If, however, the applicable Reserve shall not contain sufficient funds to pay the sums required by the dates on which such sums are required to be on deposit in such account, Grantor shall, within thirty (30) days after receipt of written notice thereof, deposit with Beneficiary the full amount of any such deficiency. If Grantor shall fail to deposit with Beneficiary the full amount of such deficiency as provided above, Beneficiary shall have the option, but not the obligation, to make such deposit, and all amounts so deposited by Beneficiary, together with interest thereon at the Default Interest Rate from the date so deposited by Beneficiary until actually paid by Grantor, shall be immediately paid by Grantor on demand and shall be secured by this Deed of Trust and by all of the other Loan Documents securing all or any part of the Debt. If there is an Event of Default under this Deed of Trust that shall have occurred and be continuing, Beneficiary may, but shall not be obligated to, apply at any time the balance then remaining in any or all of the Reserves against the Debt in whatever order Beneficiary shall subjectively determine. No such application of any or all of the Reserves shall be deemed to cure any Event of Default. Upon full payment of the Debt in accordance with its terms or at such earlier time as Beneficiary may elect, the balance of any or all of the Reserves then in Beneficiary's possession shall be paid over to Grantor and no other party shall have any right or claim thereto.

Replacement Reserve. (a) As Borrower shall not initially be under any obligation to establish or maintain a reserve for periodic replacements at the Property. Notwithstanding the foregoing, however, in the event that an Event of Default has occurred and is continuing, then, as additional security for the Debtindebtedness secured hereby, Mortgagor Borrower shall establish and maintain at all times while this Mortgage Security Deed continues in effect a capital improvement replacement reserve (the “"Replacement Reserve”") with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with capital improvements, repairs and replacements performed at the Property, including, but not limited to, the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, carpets, appliances, fixtures, elevators and mechanical and HVAC equipment (collectively, the “Replacements”"Repairs"). Commencing on the first monthly Payment Date under the Note Countryside Lake Lanier ▇▇▇▇ after the occurrence of an Event of Default and continuing thereafter on each monthly Payment Date thereafterDate, Mortgagor Borrower shall pay to MortgageeLender, in addition to concurrently with the monthly payment due under the Note and until the Debt is fully paid and performedCountryside Lake Lanier ▇▇▇▇, a deposit to the Replacement Reserve in an amount equal to $1,163 2,283.34 per month. So long as no Default or Event All sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Default has occurred Repairs, and is continuing, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee Borrower to Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the ReplacementsRepairs; and (c) for disbursement requests (i) in excess of $25,00020,000.00 with respect to any single Repair, the or (ii) for any single Repair that is structural in nature, delivery to Mortgagee Lender of (1) affidavits, lien waivers (provided, however, Lender shall not unreasonably withhold its consent to Borrower's provision of a conditional lien waiver subject only to the payment of the amount specified in such disbursement request so long as such conditional lien waiver is accompanied by a final unconditional lien waiver corresponding to any conditional lien waiver previously delivered) or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material materials or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d2) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e3) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new (or amended) certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is requiredrequired by law. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once one time in any sixty (60) day periodcalendar month. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at Mortgagor’s expenseLender's expense (provided that Borrower shall be responsible for any such expenses incurred by Lender during the occurrence and continuation of an Event of Default), make or cause to be made during the term of this Mortgage Security Deed an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based or other earnings on the daily outstanding balance funds contained in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for credited to Borrower as provided in Section_4.28 hereof. In the benefit of Mortgagor and added to event that the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds amounts on deposit or available in the Replacement Reserve are inadequate to be disbursedpay the cost of the Repairs, Borrower shall pay the amount of such deficiency.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair reserve (the ““ Replacement ReserveReserve ”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “Replacements“ Repairs ”). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 647.93 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Tenant shall establish and maintain at all times while this Mortgage continues in effect throughout the Term hereof a capital improvement cash reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 500 per licensed bed for each of the Facilities, which amount shall be funded by Tenant as hereinafter set forth and held by Landlord in a cash account on its books and records, for the payment of costs and expenses associated with capital improvements, repairs and replacements of every kind and nature to be performed at the Facilities (“Capital Improvements”), and for no other purpose. During the initial two (2) Lease Years, Tenant shall deliver to Landlord, simultaneously with each of the four installments of Base Rent to be paid during each calendar month, and in addition to all other amounts due hereunder, an amount equal to one-ninety-sixth (1/96th) of the required Replacement Reserve to be deposited into the Replacement Reserve. On or before the last day of each Lease Year, Tenant shall deposit into the Replacement Reserve such additional amounts as may be necessary to replenish any amounts drawn from the Replacement Reserve during such Lease Year. Disbursements shall be made from the Replacement Reserve only in accordance with this paragraph. So long as no Default or Event of Default has occurred and is continuing, Mortgagee shalland no event or circumstance exists which, with the giving of notice, the passage of time or both, would become an Event of Default, Landlord shall disburse to Tenant from the extent funds are available for such purpose Replacement Reserve (but in no event to exceed amounts on deposit in the Replacement Reserve), disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements within ten (10) business days following: (a) the receipt by Mortgagee of a after Tenant’s written request from Mortgagor (and provision to Landlord of any supporting documentation reasonably required by Landlord), the costs and expenses incurred installing or constructing any Capital Improvements, provided such written notice includes a detailed description of the Capital Improvements installed or constructed together with an invoice for disbursement from the Replacement Reserve and work done. With each draw request, Tenant will deliver to Landlord (i) a certification by Mortgagor in a form approved in writing by Mortgagee Tenant that the applicable item of Replacement work for which the draw to be funded has been completed; completed in accordance with applicable legal requirements, and (bii) the delivery to Mortgagee of such additional supporting evidence as may be requested by Landlord in its reasonable judgment, including such items as invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000such work, the delivery to Mortgagee of affidavits, together with affidavits and/or lien waivers from those providing work, materials or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due supplies for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the such portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee work (provided it shall not be a requirement that Tenant shall have made any payment on such invoice, unless necessary to procure the required lien waiver). Tenant will additionally furnish to make advances Landlord evidence that all necessary or required approvals or consents from the Replacement Reserve more frequently than once in any sixty (60) day periodgovernmental authorities have been obtained. In making authorizing any payment disbursement from the Replacement Reserve, Mortgagee Landlord shall be entitled to rely on such Tenant’s written request from Mortgagor and supporting documentation without any inquiry into the accuracy, validity or contestability of any such amountamount or the nature or necessity of the materials provided or the work performed. Mortgagee Landlord may, at Mortgagor’s expenseany time and from time to time, but shall have no obligation to, make or cause to be made during the term inspections of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuingFacility. In the event that any inspection report from any such inspection reveals reasonably recommends that further Replacements Capital Improvements are required or anticipated that are the obligation of Tenant in accordance the Mortgaged Property are requiredterms of this Lease, Mortgagee Landlord shall provide Mortgagor Tenant with a written description of the required Replacements such Capital Improvements and Mortgagor Tenant shall then complete such Replacements those Capital Improvements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days Landlord as expeditiously as is reasonably practicable under the circumstances after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretionLandlord. (b) Mortgagee shall cause funds in It is specifically hereby stipulated and agreed that notwithstanding the preceding provisions of this Section 11.2, the management, uses and disbursement procedures and requirements of the Replacement Reserve may be taken over by a Facility Mortgagee, and Tenant agrees to negotiate in good faith any changes to this Section 11.2 as may be deposited into interest bearing accounts reasonably requested by a Facility Mortgagee in such event and to pay the reasonable costs of the type customarily maintained by Facility Mortgagee in processing draw requests. (c) Tenant shall provide Landlord with an engineering or its servicing agent for the investment of similar reservesproperty condition report (at Tenant’s sole cost and expense and in form and substance satisfactory to Landlord in Landlord’s sole discretion) with respect to each Facility, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, nonmore than twenty-compounded interest basis based solely on contributions made four (24) months nor less than eighteen (18) months prior to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment end of the items for which other funds in the Replacement Reserve are Initial Term (unless Tenant has elected a renewal option pursuant to be disbursed.Article 3) or (if Tenant has elected a renewal option pursuant to

Replacement Reserve. (a) As additional security for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles principles, consistently applied (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 per month3,459.00 on each Payment Date. So long as no Default or Event of Default has occurred and is continuingcontinuing and then exists and has not been waived, Mortgagee shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee Mortgagee, which approval shall not be unreasonably withheld, conditioned or delayed that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence reasonably satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,00050,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid paid, or upon the making of the requested disbursements, will be paid, all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00050,000, delivery to Mortgagee of a certification from an inspecting architect or other third party reasonably acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a an architect’s certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuingcontinuing and not been waived. In the event that such inspection reveals reveals, in Mortgagee’s reasonable opinion, that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty ninety (12090) days (or such additional time as reasonably required so long as Mortgagor has begun the completion of such Replacements within such ninety (90) day period and diligently continues such work) after the receipt of such description from Mortgagee, subject to extension for force majeure, or such later date as may be approved by Mortgagee in its sole reasonable discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed. (c) As additional security for the payment and performance by Mortgagor of all duties, responsibilities and obligations under the Note, this Mortgage and the other Loan Documents, Mortgagor hereby unconditionally and irrevocably assigns and pledges to Mortgagee, and hereby grants to Mortgagee a security interest in, (i) the Impound Account, the Replacement Reserve, the Repair and Remediation Reserve and any other reserve or escrow account established pursuant to the terms hereof or of any other Loan Document (collectively, the “Reserves”), (ii) all insurance on said accounts, (iii) all accounts, contract rights and general intangibles or other rights and interests pertaining thereto, (iv) all replacements, substitutions or proceeds thereof, (v) all instruments and documents now or hereafter evidencing the Reserves or such accounts, (vi) all powers, options, rights, privileges and immunities pertaining to the Reserves (including the right to make withdrawals therefrom) and (vii) all replacements, substitutions and all proceeds of the foregoing. Mortgagor hereby authorizes and consents to each account into which the Reserves have been deposited being held in Mortgagee’s name or the name of any entity servicing the loan evidenced by the Note for Mortgagee and hereby acknowledges and agrees that Mortgagee, or at Mortgagee’s election, such servicing agent, shall have exclusive control over each account. Notice of the assignment and security interest granted to Mortgagee herein may be delivered by Mortgagee to Mortgagor at any time to the financial institutions wherein the Reserves have been established, and Mortgagee, or such servicing entity, shall have possession of all passbooks or other evidences of such accounts. Mortgagor hereby assumes all risk of loss with respect to amounts on deposit in the Reserves other than any such loss resulting solely from the willful misconduct or gross negligence of Mortgagee as finally determined by a court of competent jurisdiction. Mortgagor hereby knowingly, voluntarily and intentionally stipulates, acknowledges and agrees that the advancement of the funds from the Reserves as set forth herein is at Mortgagor’s direction and is not the exercise by Mortgagee of any right of set-off or other remedy upon a Default or an Event of Default. Mortgagor hereby waives all right to withdraw funds from the Reserves except as provided for in this Mortgage. If an Event of Default shall occur hereunder or under any other of the Loan Documents which is not cured or waived, Mortgagee may, without notice or demand on Mortgagor, at its option: (A) withdraw any or all of the funds (including, without limitation, interest) then remaining in the Reserves and apply the same, after deducting all reasonable, out-of-pocket costs and expenses of safekeeping, collection and delivery (including, but not limited to, reasonable attorneys’ fees, costs and expenses) to the Debt or any other obligations of Mortgagor under the other Loan Documents in such manner as Mortgagee shall deem appropriate in its sole discretion, and the excess, if any, shall be paid to Mortgagor, (B) exercise any and all rights and remedies of a secured party under any applicable Uniform Commercial Code or (C) exercise any other remedies available at law or in equity. No such use or application of the funds contained in the Reserves shall be deemed to cure any Default or Event of Default. (d) The Reserves shall not, unless otherwise explicitly required by applicable law, be or be deemed to be escrow or trust funds, but, at Mortgagee’s option and in Mortgagee’s discretion, may either be held in a separate account or be commingled by Mortgagee with the general funds of Mortgagee. Upon assignment of this Mortgage by Mortgagee, any funds in the Reserves shall be turned over to the assignee and any responsibility of Mortgagee, as assignor, with respect thereto shall terminate, provided that the assignee assumes all obligations related to such Reserves and Mortgagor is provided with notice of such assignment. If the funds in the applicable Reserve shall exceed the amount of payments actually applied by Mortgagee for the purposes and items for which the applicable Reserve is held, such excess may be credited by Mortgagee on subsequent payments to be made hereunder or, at the option of Mortgagee, refunded to Mortgagor. If, however, the applicable Reserve shall not contain sufficient funds to pay the sums required by the dates on which such sums are required to be on deposit in such account, Mortgagor shall, within ten (10) days after receipt of written notice thereof, deposit with Mortgagee the full amount of any such deficiency. If Mortgagor shall fail to deposit with Mortgagee the full amount of such deficiency as provided above, Mortgagee shall have the option, but not the obligation, to make such deposit.

Replacement Reserve. In addition to any other construction, renovation and maintenance requirements set forth in this Agreement, commencing with the first Loan Year, Borrowers shall expend at least $0.20 per square foot of net rentable space (aexclusive of Insurance Proceeds and proceeds from the Holdback) As additional security for on maintenance of the DebtProjects. To the extent Borrowers do not provide evidence, Mortgagor reasonably satisfactory to Lender, that Borrowers have spent such sum on an annual basis, Borrowers shall establish and maintain at all times while this Mortgage continues deposit with Lender such amount not spent. Lender shall hold such sum in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and Borrowers’ use to fund future maintenance expenses incurred by Mortgagor Borrowers in connection with any Loan Year after Borrowers have spent in the performance aggregate at least $0.20 per square foot of work which would normally net rentable space on maintenance of the Projects during the then current Loan Year. Such amounts shall be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to disbursed from the Replacement Reserve in an amount equal to $1,163 per month. So long as no Default or Event upon satisfaction of Default has occurred and is continuing, Mortgagee shall, the same conditions applicable to the extent funds are available for such purpose Holdback (other than obtaining a date down endorsement to the Title Policies). Borrowers hereby grant Lender a first priority security interest in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve all funds contained therein and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens products and proceeds thereof and all such funds are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy pledged as additional collateral for the portion of Loan and Borrowers shall execute any other documents and take any other actions necessary to provide Lender with such a perfected security interest in such funds. Upon the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, Maturity Date or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in at any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or time following an Event of Default shall have occurred and is continuing. In Default, the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds moneys then remaining in the Replacement Reserve shall, at Lender’s option, be applied against the Indebtedness. All sums held in the Replacement Reserve may be commingled with other borrower reserves held by Lender and shall not be deemed to be deposited into interest bearing accounts held in trust for the benefit of Borrowers. The Replacement Reserve shall be maintained at a financial institution designated by Lender from time to time, in its sole and absolute discretion (so long as such institution’s deposits are insured by the type customarily maintained by Mortgagee Federal Deposit Insurance Corporation), and shall be under the sole dominion and control of Lender, and Borrowers shall have no right to control or its servicing agent for direct the investment of similar reservesfunds therein. Sums held by Lender in the Replacement Reserve shall accrue interest at rates determined by Lender to be equivalent to any interest received by Lender on its own general funds, which accounts may not yield the highest and any interest rate then available. Interest payable accruing and paid on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall deemed to be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit part of Mortgagor and added to the balance in the Replacement Reserve and absent an Event of Default hereunder, shall be disbursed for payment of the items for which other funds applied in the Replacement Reserve are to be disbursedaccordance with this Section 4.1(n).

Replacement Reserve. (a) As Borrower shall establish and maintain a replacement reserve (the "Replacement Reserve") with Lender as additional security for the Debt, Mortgagor shall establish Indebtedness and maintain at all times while this Mortgage continues in effect a capital improvement reserve (the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”)Obligations. Commencing on the first Payment Date under (as defined in the Note Note) and continuing thereafter on each successive Payment Date thereafteruntil the Maturity Date, Mortgagor Borrower shall pay to MortgageeLender, in addition to concurrently with the monthly payment due under the Note and until the Debt is fully paid and performedNote, a deposit to the Replacement Reserve in an amount equal to the quotient of (i) Zero and 25/100 Dollars ($1,163 0.25) per monthsquare foot of the Improvements (excluding any rentable square feet for which tenants of the Improvements are responsible for maintaining the structure of such Improvements) divided by (ii) twelve (12). Lender shall have the right to review the amount of the Replacement Reserve annually and to assess, in its sole discretion, whether the amount deposited into the Replacement Reserve needs to be increased or decreased. (b) The Replacement Reserve is established for the payment of costs and expenses as may be incurred by Borrower for Repairs. So long as no Default or Event of Default has occurred and is continuing, Mortgagee (i) all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs, and (ii) Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount Borrower, as Lender may approve, in Lender's reasonable discretion, amounts paid or incurred by Mortgagor in Borrower and performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for a disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee from Borrower to Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or of other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacementssuch Repairs; and (c) for in the case of a disbursement requests request from the Replacement Reserve in excess of $25,00025,000 with respect to any single Repair, the delivery to Mortgagee Lender of (1) affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material materials or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e2) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new (or amended) certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is requiredrequired by law. Mortgagee Lender shall not be required or requested to make advances from the Replacement Reserve more frequently than once one time in any sixty (60) day periodcalendar month. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee . (c) Lender may, at Mortgagor’s Borrower's expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the adequacy of the scheduled deposits into the Replacement Reserve and the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements of Repairs to the Mortgaged Property; provided, however, absent the then existence of an Event of Default, Borrower shall only be required to reimburse Lender for the reasonable costs of any such inspection to be no more frequent than a maximum of once in any calendar year unless a Default or an Event of Default shall have occurred and is continuingyear. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee then, in addition to any other remedy Lender may be entitled to hereunder, Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole reasonable discretion. (b. Additionally, Lender may, as a product of any such inspection, require that the amount of the scheduled monthly deposits into the Replacement Reserve described in Section 2.8(b) Mortgagee shall cause funds above be increased in order to accommodate Lender's reasonable estimation of the likely increased cost of future Repairs. In the event that the amount on deposit and available in the Replacement Reserve is ever inadequate to be deposited into interest bearing accounts pay the cost of the type customarily maintained by Mortgagee or its servicing agent for Repairs, Borrower shall pay the investment amount of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disburseddeficiency.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage continues in effect a capital improvement replacement reserve (the “"Replacement Reserve”") with Mortgagee Lender as additional security for payment Borrower's repayment of costs the Indebtedness and expenses incurred by Mortgagor in connection with satisfaction of the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”)Obligations. Commencing on the earlier to occur of (i) the Amortization Commencement Date or (ii) the first Payment Date under the Note after an Event of Default and continuing thereafter on each successive Payment Date thereafteruntil the Maturity Date, Mortgagor including during the Extension Period, if applicable, Borrower shall pay to MortgageeLender, in addition to concurrently with the monthly payment due under the Note and until the Debt is fully paid and performedNote, a deposit to the Replacement Reserve in an amount equal to amount equal to $1,163 per month3,333. (b) The Replacement Reserve is established for the payment of costs and expenses as may be incurred by Borrower for Replacement Reserve Repairs. So long as no Default or Event of Default has occurred and is continuing, Mortgagee (i) all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Replacement Reserve Repairs, and (ii) Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount Borrower, as Lender may approve, in Lender's reasonable discretion, amounts paid or incurred by Mortgagor in Borrower and performing Replacements such Replacement Reserve Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for a disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee from Borrower to Lender that the applicable item of Replacement Reserve Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or of other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacementssuch Replacement Reserve Repairs; and (c) for in the case of a disbursement requests request from the Replacement Reserve in excess of $25,00025,000 with respect to any single Replacement Reserve Repair, the delivery to Mortgagee Lender of (1) affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material materials or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e2) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new (or amended) certificate of occupancy for the portion of the Improvements covered by such ReplacementsReplacement Reserve Repairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is requiredrequired by law. Mortgagee Lender shall not be required or requested to make advances from the Replacement Reserve more frequently than once one time in any sixty (60) day periodcalendar month. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee . (c) Lender may, at Mortgagor’s Borrower's expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the adequacy of the scheduled deposits into the Replacement Reserve and the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements of Replacement Reserve Repairs to the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Replacement Reserve Repairs of the Mortgaged Property are required, Mortgagee then, in addition to any other remedy Lender may be entitled to hereunder, Lender shall provide Mortgagor Borrower with a written description of the required Replacements Replacement Reserve Repairs and Mortgagor Borrower shall complete such Replacements Replacement Reserve Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its reasonable discretion. Additionally, Lender may, as a product of any such inspection, require that the amount of the scheduled monthly deposits into the Replacement Reserve described in subsection (a) above be increased in order to accommodate Lender's estimation, in Lender's sole discretion. (b) Mortgagee shall cause funds , of the likely increased cost of future Replacement Reserve Repairs. In the event that the amount on deposit and available in the Replacement Reserve is ever inadequate to be deposited into interest bearing accounts pay the cost of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by MortgagorRepairs, Borrower shall pay the amount of such deficiency. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.EXHIBIT B, Special Provisions Debt Service Coverage Ratio Calculation Methodology – Page 4 641926; Miami-Dade County – Florida

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrowers shall establish and maintain at all times while this Mortgage continues in effect a capital improvement reserve (the “Replacement Reserve”) deposit with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing Administrative Agent on each Payment Date thereafterthe product of Twenty-Five Dollars ($25.00) multiplied by the number of Senior Housing Units in the Borrowing Base Assets, Mortgagor which shall pay be held by Administrative Agent or its servicer for replacements and repairs required to Mortgagee, in addition be made to the monthly payment due under Borrowing Base Assets during the Note and until term of the Debt is fully paid and performed, a deposit to Loan (the "Replacement Reserve in an amount equal to $1,163 per monthEscrow Fund"). So long as no Default or Event of Default has occurred and is continuingexists hereunder, Mortgagee shall, Administrative Agent shall credit for Borrowers' account interest at the interest rate actually available to Administrative Agent's servicer on the extent funds are available for held in such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the needaccount, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee Administrative Agent in its sole discretion. (b) Mortgagee shall cause funds . Borrowers hereby pledge to Administrative Agent for the benefit of the Lenders, and grant a security interest in, any and all monies now or hereafter deposited in the Replacement Reserve Escrow Fund as additional security for the payment of the Loan. Administrative Agent may reasonably reassess its estimate of the amount necessary for the Replacement Escrow Fund from time to time and may adjust the monthly amounts required to be deposited into interest bearing accounts the Replacement Escrow Fund upon thirty (30) days' notice to Borrowers. Administrative Agent shall make disbursements from the Replacement Escrow Fund as requested by Borrowers, and approved by Administrative Agent in its reasonable discretion, on a quarterly basis in increments of no less than $5,000.00 upon delivery by Borrowers of Administrative Agent's standard form of draw request accompanied by copies of paid invoices for the amounts requested and, if required by Administrative Agent for any draw request for an invoice exceeding $15,000.00, lien waivers and releases from all parties furnishing materials and/or services in connection with the requested payment. Administrative Agent may require an inspection of the type customarily maintained by Mortgagee or its servicing agent Borrowing Base Assets at Borrowers' expense prior to making a quarterly disbursement in order to verify completion of replacements and repairs for the investment of similar reserves, which accounts may not yield the highest interest rate then availablereimbursement is sought. Interest payable on such amounts The Replacement Escrow Fund shall be computed based on held without interest in Administrative Agent's name and may be commingled with Administrative Agent's general funds at financial institutions selected by Administrative Agent in its reasonable discretion. Upon the daily outstanding balance occurrence of an Event of Default, Administrative Agent may apply any sums then present in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made Escrow Fund to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items Loan in any order in its reasonable discretion. Until expended or applied as above provided, the Replacement Escrow Fund shall constitute additional security for which other funds the Loan. Administrative Agent shall have no obligation to release any of the Replacement Escrow Fund while any Event of Default or Default exists. All costs and expenses incurred by Administrative Agent in the disbursement of any of the Replacement Reserve are to Escrow Fund shall be disbursedpaid by Borrowers promptly upon demand or, at Administrative Agent's sole discretion, deducted from the Replacement Escrow Fund.

Replacement Reserve. (a) As Borrower shall not initially be under any obligation to establish or maintain a reserve for periodic replacements at the Property. Notwithstanding the foregoing, however, in the event that an Event of Default has occurred and is continuing, then, as additional security for the Debtindebtedness secured hereby, Mortgagor Borrower shall establish and maintain at all times while this Mortgage Deed of Trust continues in effect a capital improvement replacement reserve (the “"Replacement Reserve”") with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with capital improvements, repairs and replacements performed at the Property, including, but not limited to, the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, carpets, appliances, fixtures, elevators and mechanical and HVAC equipment (collectively, the “Replacements”"Repairs"). Commencing on the first monthly Payment Date under the Sun Villa Note after the occurrence of an Event of Default and continuing thereafter on each monthly Payment Date thereafterDate, Mortgagor Borrower shall pay to MortgageeLender, in addition to concurrently with the monthly payment due under the Note and until the Debt is fully paid and performedSun Villa Note, a deposit to the Replacement Reserve in an amount equal to $1,163 1,350.00 per month. So long as no Default or Event All sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Default has occurred Repairs, and is continuing, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee Borrower to Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the ReplacementsRepairs; and (c) for disbursement requests (i) in excess of $25,00020,000.00 with respect to any single Repair, the or (ii) for any single Repair that is structural in nature, delivery to Mortgagee Lender of (1) affidavits, lien waivers (provided, however, Lender shall not unreasonably withhold its consent to Borrower's provision of a conditional lien waiver subject only to the payment of the amount specified in such disbursement request so long as such conditional lien waiver is accompanied by a final unconditional lien waiver corresponding to any conditional lien waiver previously delivered) or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material materials or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d2) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e3) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new (or amended) certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is requiredrequired by law. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once one time in any sixty (60) day periodcalendar month. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at Mortgagor’s expense, make or cause to Lender's expense (provided that Borrower shall be made responsible for any such expenses incurred by Lender during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred occurrence and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.continuation of

Replacement Reserve. (a) As additional security for So long as (i) the Debt, Mortgagor shall establish Debt Service Coverage Ratio is less than 1.50:1.00 and maintain (ii) less than seventy-five percent (75%) of the total number of rentable square feet at all times while this Mortgage continues the Properties is leased pursuant to Wachovia Leases having terms and conditions substantially similar to those Wachovia Leases in effect a capital improvement reserve as of the Closing Date, Borrower shall pay to Lender on each Payment Date the Replacement Reserve Monthly Deposit (such amounts so deposited shall hereinafter be called the “Replacement ReserveReserve Funds”) with Mortgagee for payment of costs replacements and expenses incurred by Mortgagor in connection with repairs required to be made to each Property during the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles calendar year (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, The account in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to which the Replacement Reserve Funds are held shall hereinafter be referred to as the “Replacement Reserve Account.” Lender may reassess its estimate of the Replacement Reserve Monthly Deposit from time to time, and may increase same upon thirty (30) days notice to Borrower if Lender determines in its reasonable discretion that an amount increase is necessary to maintain the proper maintenance and operation of any of the Properties. Notwithstanding anything contained in this clause (a) to the contrary, the Replacement Reserve Funds shall not include any costs of Replacements at any Property which are required to be paid by Wachovia pursuant to the Wachovia Lease applicable to such Property. At such time as (i) the Debt Service Coverage Ratio is equal to $1,163 per month. So long or greater than 1.75:1.00 and (ii) seventy-five percent (75%) or more of the total number of rentable square feet at the Properties is leased pursuant to Wachovia Leases having terms and conditions substantially similar to those Wachovia Leases in effect as of the Closing Date, all funds then on deposit in the Replacement Reserve Account shall be returned to Borrower, provided no Default or Event of Default has occurred and is then continuing. (b) Lender shall make disbursements from the Replacement Reserve Account to pay Borrower only for the costs of the Replacements at the Properties for which the Replacement Reserve Funds are being held pursuant to this Section 7.3. Lender shall not be obligated to make disbursements from the Replacement Reserve Account to reimburse Borrower for the costs of routine maintenance to any Property. For the purposes of this Section, Mortgagee any item for which a disbursement from the Replacement Reserve Account is requested shall hereinafter be called a “Work Item.” (c) Lender shall, to upon written request from Borrower and satisfaction of the extent funds are available for such purpose requirements set forth in the Replacement Reservethis Section 7.3, disburse to Mortgagor Borrower amounts from the amount paid Replacement Reserve Account necessary to pay for the actual approved costs of Replacements or incurred to reimburse Borrower therefore, upon completion of such Replacements (or, upon partial completion) as determined by Mortgagor in performing Replacements within ten Lender. In no event shall Lender be obligated to disburse funds from the Replacement Reserve Account if an Event of Default exists. (10d) days following: (a) the receipt by Mortgagee of a written Each request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor Account shall be in a form reasonably approved by Lender and shall specify (i) the specific Work Item for which the disbursement is requested, (ii) the quantity and price of each item purchased, if the Work Item includes the purchase or replacement of specific items, (iii) the price of all materials (grouped by type or category) used in any Work Item other than the purchase or replacement of specific items, and (iv) the cost of all contracted labor or other services applicable to each Work Item for which such request for disbursement is made. With each request Borrower shall certify that all Work Items have been made in accordance with all applicable Legal Requirements of any Governmental Authority having jurisdiction over the applicable Property, and in accordance with the Condominium Documents, if applicable. Each request for disbursement shall include, upon Lender’s request, copies of invoices for all items or materials purchased and all contracted labor or services provided and, unless Lender has agreed to issue joint checks as described below in connection with a particular Work Item, each request shall include evidence satisfactory to Lender of payment of all such amounts. (e) Borrower shall pay all invoices in connection with the Work Items with respect to which a disbursement is requested prior to submitting such request for disbursement from the Replacement Reserve Account or, at the request of Borrower, Lender will issue joint checks, payable to Borrower and the contractor, supplier, materialman, mechanic, subcontractor or other party to whom payment is due in connection with a Work Item. In the case of payments made by joint check, Lender may require a waiver of lien from each Person receiving payment prior to Lender’s disbursement from the Replacement Reserve Account. Any lien waiver delivered hereunder shall conform to the requirements of applicable law and shall cover all work performed and materials supplied (including equipment and fixtures) for the applicable Property by that contractor, supplier, subcontractor, mechanic or materialman through the date covered by the current reimbursement request (or, in the event that payment to such contractor, supplier, subcontractor, mechanic or materialmen is to be made by a joint check, the release of lien shall be effective through the date covered by the previous release of funds request). (f) Borrower shall not make a request for disbursement from the Replacement Reserve Account more frequently than twice in any calendar month and (except in connection with the final disbursement) the total cost of all Replacements in any request shall not be less than $25,000. (g) With regard to disbursements from the Replacement Reserve Account, Borrower shall make Replacements when required in order to keep the applicable Property in condition and repair consistent with other first class, office properties in the same market segment in the metropolitan area in which the applicable Property is located, and to keep the applicable Property or any portion thereof from deteriorating. Borrower shall complete all Replacements in a good and workmanlike manner as soon as practicable following the commencement of making each such Replacement. (h) During the continuance of an Event of Default or a Low DSCR Period, Lender reserves the right, at its option, to approve all contracts or work orders with materialmen, mechanics, suppliers, subcontractors, contractors or other parties providing labor or materials in connection with the Work Items to the extent the estimated cost thereof exceeds $100,000, provided that any such approval shall not be unreasonably withheld and should be delivered to the Borrower within five (5) Business Days of any request thereof. Upon Lender’s request, Borrower shall assign any contract or subcontract to Lender. (i) During the continuance of an Event of Default or a Low DSCR Period, if Lender determines in its reasonable discretion that any Work Item is not being performed in a workmanlike or timely manner or that any Work Item has not been completed in a workmanlike or timely manner, Lender shall have the option to withhold disbursement for such unsatisfactory Work Item and to proceed under existing contracts or to contract with third parties to complete such Work Item and to apply the Replacement Reserve Funds toward the labor and materials necessary to complete such Work Item, without providing any prior notice to Borrower and to exercise any and all other remedies available to Lender upon an Event of Default hereunder. (j) In order to facilitate Lender’s completion or making of the Work Items, Borrower grants Lender the right to enter onto the applicable Property and perform any and all work and labor necessary to complete or make the Work Items and/or employ watchmen to protect the applicable Property from damage. All sums so expended by Lender, to the extent not from the Replacement Reserve Fund, shall be deemed to have been advanced under the Loan to Borrower and secured by the related Security Instrument. For this purpose Borrower constitutes and appoints Lender its true and lawful attorney-in-fact with full power of substitution to complete or undertake the Work Items in the name of Borrower. Such power of attorney shall be deemed to be a power coupled with an interest and cannot be revoked. Borrower empowers said attorney-in-fact as follows: (i) to use any funds in the Replacement Reserve Account for the purpose of making or completing the Work Items; (ii) to make such additions, changes and corrections to the Work Items as shall be necessary or desirable to complete the Work Items; (iii) to employ such contractors, subcontractors, agents, architects and inspectors as shall be required for such purposes; (iv) to pay, settle or compromise all existing bills and claims which are or may become Liens against any Property, or as may be necessary or desirable for the completion of the Work Items, or for clearance of title; (v) to execute all applications and certificates in the name of Borrower which may be required by any of the contract documents; (vi) to prosecute and defend all actions or proceedings in connection with any Property or the rehabilitation and repair of any Property; and (vii) to do any and every act which Borrower might do in its own behalf to fulfill the terms of this Agreement. (k) Nothing in this Section 7.3 shall: (i) make Lender responsible for making or completing the Work Items; (ii) require Lender to expend funds in addition to Replacement Reserve Funds to make or complete any Work Item; (iii) obligate Lender to proceed with the Work Items; or (iv) obligate Lender to demand from Borrower additional sums to make or complete any Work Item. (l) During the continuance of an Event of Default or a Low DSCR Period, Lender may require an inspection of any Property at Borrower’s expense prior to making a monthly disbursement from the Replacement Reserve Account in order to verify completion of the Work Items for which reimbursement is sought. Lender may require that such inspection be conducted by an appropriate independent qualified professional selected by Lender and/or may require a copy of a certificate of completion by an independent qualified professional acceptable to Lender prior to the disbursement of any amounts from the Replacement Reserve Account. Borrower shall pay the expense of the inspection as required hereunder, whether such inspection is conducted by Lender or by an independent qualified professional. (m) The Work Items and all materials, equipment, fixtures, or any other item comprising a part of any Work Item shall be constructed, installed or completed, as applicable, free and clear of all mechanic’s, materialman’s or other liens (except for those Liens existing on the date hereof which have been approved in writing by Mortgagee that Lender). (n) Before each disbursement from the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests Reserve Account in excess of $25,000250,000, Lender may require Borrower to provide Lender with a search of title to the applicable Property effective to the date of the disbursement, which search shows that no mechanic’s or materialmen’s liens or other liens of any nature have been placed against the applicable Property since the date of recordation of the related Security Instrument and that title to the applicable Property is free and clear of all Liens (other than the lien of the related Security Instrument and any other Liens previously approved in writing by Lender, if any). (o) All Work Items shall comply with all applicable Legal Requirements of all Governmental Authorities having jurisdiction over the applicable Property, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens terms and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion conditions of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsCondominium Documents, if said new certificate applicable, and applicable insurance requirements including, without limitation, applicable building codes, special use permits, environmental regulations, and requirements of occupancy is insurance underwriters. (p) In addition to any insurance required by lawunder the Loan Documents, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee Borrower shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make provide or cause to be made during provided workmen’s compensation insurance, builder’s risk, and public liability insurance and other insurance to the term extent required under applicable law in connection with a particular Work Item. All such policies shall be in form and amount reasonably satisfactory to Lender. All such policies which can be endorsed with standard mortgagee clauses making loss payable to Lender or its assigns shall be so endorsed. Certified copies of this Mortgage an annual inspection such policies shall be delivered to Lender. (q) During the continuance of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In Default, Lender may use the event that such inspection reveals that further Replacements Replacement Reserve Funds (or any portion thereof) for any purpose, including but not limited to completion of the Mortgaged Work Items or for any other repair or replacement to any Property are required, Mortgagee shall provide Mortgagor with a written description or toward payment of the required Replacements Debt in such order, proportion and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date priority as Lender may be approved by Mortgagee determine in its sole discretion. (br) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts The insufficiency of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the any balance in the Replacement Reserve Account shall not relieve Borrower from its obligation to fulfill all preservation and maintenance covenants in the Loan Documents. (s) Borrower shall be disbursed for payment indemnify Lender and hold Lender harmless from and against any and all actions, suits, claims, demands, liabilities, losses, damages, obligations and costs and expenses (including litigation costs and reasonable attorneys fees and expenses) arising from or in any way connected with the performance of the items for which other funds Replacements. Borrower shall assign to Lender all rights and claims Borrower may have against all persons or entities supplying labor or materials in connection with the Replacement Reserve are to be disbursedWork Items; provided, however, that Lender may not pursue any such right or claim unless an Event of Default has occurred and remains uncured.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage Deed of Trust continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 5,416.67 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage Deed of Trust an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. On the Closing Date, Borrowers shall deposit with Lender (aor such agent of Lender as Lender may designate in writing to Borrowers from time to time) As additional security $1,073,000.00 (the "Initial Replacement Reserve Deposit"), and thereafter Borrowers shall deposit with Lender monthly, on each Payment Date commencing with the First Payment Date, $19,135.17 (subject to adjustment as provided below, the "Monthly Replacement Reserve Amount") for the Debtpurpose of creating a reserve for Capital Expenditures (said funds, Mortgagor shall establish together with any interest thereon and maintain at all times while this Mortgage continues in effect a capital improvement reserve (additions thereto, the “"Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”"). Commencing on In the first Payment Date event of a Partial Release permitted under this Loan Agreement, Lender agrees, upon written request from Borrowers, to adjust the Note Monthly Replacement Reserve Amount to account for the release of such Individual Property(ies), which adjustment shall be in the amount such that the Monthly Replacement Reserve Amount equals the product of $214 multiplied by the number of Units in the remaining Properties divided by twelve (12). Lender's determination of such adjusted amount shall be sent to Borrowers within forty-five (45) days after Lender's receipt of Borrowers' written request therefor, and continuing absent manifest error, Lender's determination shall be deemed reasonable and final, and shall constitute the Monthly Replacement Reserve Amount required to be deposited into the Replacement Reserve on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 per month. So long as no Default or Event of Default has occurred and is continuing, Mortgagee shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee no event shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment reduced as a consequence of the items for which other a Partial Release. The funds contained in the Replacement Reserve shall be utilized solely to pay for or reimburse Borrowers for the actual bona fide out-of-pocket cost of Capital Expenditures performed during the term of the Loan in accordance with the schedule of permitted capital expenditures attached hereto as Schedule 6.4, or for such other Capital Expenditures as are approved by Lender for disbursements from the Replacement Reserve (collectively, "Approved Capital Expenditures"), and shall not be used by Borrowers for purposes for which any other Reserve is established. Upon Borrowers' written request for disbursement, Lender shall disburse funds from the Replacement Reserve to or for the account of Borrowers, to pay for or to reimburse Borrowers for such Approved Capital Expenditures, on the Payment Date following such request, upon satisfaction of each of the conditions listed on Schedule 6.6 and each of the conditions set forth in Section 6.6, provided, in no event shall Lender be disbursedobligated to disburse to Borrowers more than the aggregate of (i) the Annualized Disbursement Amount (as defined below) plus (ii) twenty percent (20%) of the Initial Replacement Reserve Deposit in any calendar year. The "Annualized Disbursement Amount" shall be equal to zero for purposes of determining disbursements from the Replacement Reserve prior to January, 2005, and shall be $229,622.00 thereafter, less, if a Partial Release of any Individual Property(ies) occurs, an amount equal to the product of $214 multiplied by the number of Units in the Individual Property(ies) subject to such Partial Release divided by twelve (12).

Replacement Reserve. (a) As Borrower shall not initially be under any obligation to establish or maintain a reserve for periodic replacements at the Property. Notwithstanding the foregoing, however, in the event that an Event of Default has occurred and is continuing, then, as additional security for the Debtindebtedness secured hereby, Mortgagor Borrower shall establish and maintain at all times while this Mortgage Security Deed continues in effect a capital improvement replacement reserve (the “"Replacement Reserve”") with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with capital improvements, repairs and replacements performed at the Property, including, but not limited to, the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, carpets, appliances, fixtures, elevators and mechanical and HVAC equipment (collectively, the “Replacements”"Repairs"). Commencing on the first monthly Payment Date under the Countryside Atlanta Note after the occurrence of an Event of Default and continuing thereafter on each monthly Payment Date thereafterDate, Mortgagor Borrower shall pay to MortgageeLender, in addition to concurrently with the monthly payment due under the Note and until the Debt is fully paid and performedCountryside Atlanta Note, a deposit to the Replacement Reserve in an amount equal to $1,163 1,129.17 per month. So long as no Default or Event All sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Default has occurred Repairs, and is continuing, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee Borrower to Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the ReplacementsRepairs; and (c) for disbursement requests (i) in excess of $25,00020,000.00 with respect to any single Repair, the or (ii) for any single Repair that is structural in nature, delivery to Mortgagee Lender of (1) affidavits, lien waivers (provided, however, Lender shall not unreasonably withhold its consent to Borrower's provision of a conditional lien waiver subject only to the payment of the amount specified in such disbursement request so long as such conditional lien waiver is accompanied by a final unconditional lien waiver corresponding to any conditional lien waiver previously delivered) or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.could

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage Deed of Trust continues in effect a capital improvement repair reserve (the “Replacement Reserve”) with Mortgagee Lender for payment of costs and expenses incurred by Mortgagor Borrower in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment (collectively, the “ReplacementsRepairs”). Commencing with First Payment Date (as defined in the Note) and continuing thereafter on the first each monthly Payment Date under the Note and continuing on each Payment Date thereafterNote, Mortgagor Borrower shall pay to MortgageeLender, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 919.00 per month. So long as no Event of Default has occurred, all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Repairs. So long as no Default or Event of Default has occurred and is continuingoccurred, Mortgagee Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Borrower the amount paid or incurred by Mortgagor Borrower in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for disbursement from the Replacement Reserve and a certification by Mortgagor Borrower in a form approved in writing by Mortgagee Lender that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or other evidence satisfactory to MortgageeLender, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00025,000.00, the delivery to Mortgagee Lender of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,00025,000.00, delivery to Mortgagee Lender of a certification from an inspecting architect or other third party acceptable to Mortgagee Lender describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests in excess of $50,00025,000.00, delivery to Mortgagee Lender of a new certificate of occupancy for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is required. Mortgagee Lender shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty thirty (6030) day period. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Lender may, at MortgagorBorrower’s expense, make or cause to be made during the term of this Mortgage Deed of Trust an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements Repairs of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Property are required, Mortgagee Lender shall provide Mortgagor Borrower with a written description of the required Replacements Repairs and Mortgagor Borrower shall complete such Replacements Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Grantor shall establish and maintain at all times while this Mortgage Deed of Trust continues in effect a capital improvement repair and replacement reserve (the “"Replacement Reserve”") with Mortgagee Beneficiary for payment of costs and expenses incurred by Mortgagor Grantor in connection with the performance of work which would normally be treated related to the maintenance, replacement and/or repair of the Trust Property, including without limitation, work to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment and such other work as a capital improvement under generally accepted accounting principles Grantor deems necessary or appropriate (collectively, the “Replacements”"Repairs"). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Grantor shall pay to MortgageeBeneficiary, concurrently with and in addition to the monthly payment payments due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 4,416.67 per month. So long as no Default or Event of Default has occurred and is continuing, Mortgagee all sums in the Replacement Reserve shall be held by Beneficiary in the Replacement Reserve to pay the costs and expense of Repairs. So long as no Event of Default has occurred and is continuing, Beneficiary shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Grantor the amount paid or incurred by Mortgagor Grantor in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Beneficiary of a written request from Mortgagor Grantor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee Grantor that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Beneficiary of invoices, receipts receipts, cancelled checks or other evidence reasonably satisfactory to MortgageeBeneficiary, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests with individual items costing in excess of $25,00050,000.00, the delivery to Mortgagee Beneficiary of affidavits, lien waivers waivers, cancelled checks or other evidence reasonably satisfactory to Mortgagee Beneficiary showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Trust Property have been paid all amounts due for labor and materials furnished to the Mortgaged Trust Property; (d) for disbursement requests with individual items costing in excess of $25,00050,000.00, delivery to Mortgagee Beneficiary of a certification from an inspecting architect or other a third party acceptable to Mortgagee Beneficiary describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests with individual items costing in excess of $50,00050,000.00, delivery to Mortgagee Beneficiary of a new certificate of occupancy or local equivalent for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Grantor that no new certificate of occupancy is required. Mortgagee Beneficiary shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty ninety (6090) day period. In making any payment from the Replacement Reserve, Mortgagee Beneficiary shall be entitled to rely on such request from Mortgagor Grantor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Beneficiary may, at Mortgagor’s ▇▇▇▇▇▇▇'s expense, make or cause to be made during the term of this Mortgage Deed of Trust an annual inspection of the Mortgaged Trust Property to determine the need, as determined by Mortgagee Beneficiary in its reasonable judgment, for further Replacements Repairs of the Mortgaged Trust Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Trust Property are required, Mortgagee Beneficiary shall provide Mortgagor Grantor with a written description of the required Replacements Repairs and Mortgagor Grantor shall complete such Replacements to the reasonable satisfaction of Mortgagee respond within one hundred twenty thirty (12030) days after the receipt of such description from Mortgageerequest, or and, thereafter, Grantor shall make such later date Repairs, as may be approved mutually agreed upon by Mortgagee Grantor and Beneficiary and within such time period as may be mutually agreed upon. Funds contained in its sole discretionthe Replacement Reserve shall be placed in an interest-bearing account upon receipt and interest thereon credited to Grantor as provided in Section 4.31 hereof. (b) Mortgagee As additional security for the payment and performance by Grantor of all duties, responsibilities and obligations under the Note and the other Loan Documents, Grantor hereby unconditionally and irrevocably assigns, conveys, pledges, mortgages, transfers, delivers, deposits, sets over and confirms unto Beneficiary, and hereby grants to Beneficiary a security interest in Grantor's right, title and interest in, (i) the Impound Account, the Replacement Reserve, the Repair and Remediation Reserve and any other reserve or escrow account established pursuant to the terms hereof or of any other Loan Document (collectively, the "Reserves"), (ii) the accounts into which the Reserves have been deposited, (iii) all insurance on said accounts, (iv) all accounts, contract rights and general intangibles or other rights and interests pertaining thereto, (v) all sums now or hereafter therein or represented thereby, (vi) all replacements, substitutions or proceeds thereof, (vii) all instruments and documents now or hereafter evidencing the Reserves or such accounts, (viii) all powers, options, rights, privileges and immunities pertaining to the Reserves (including the right to make withdrawals therefrom), and (ix) all proceeds of the foregoing. Grantor hereby authorizes and consents to the account into which the Reserves have been deposited being held in Beneficiary's name or the name of any entity servicing the Note for Beneficiary and hereby acknowledges and agrees that Beneficiary, or at Beneficiary's election, such servicing agent, shall cause have exclusive control over said account. Notice of the assignment and security interest granted to Beneficiary herein may be delivered by Beneficiary at any time to the financial institution wherein the Reserves have been established, and Beneficiary, or such servicing entity, shall have possession of all passbooks or other evidences of such accounts. Grantor hereby assumes all risk of loss with respect to amounts on deposit in the Reserves, unless finally determined by a court of competent jurisdiction to have been caused by the gross negligence or willful misconduct of Beneficiary. Grantor hereby knowingly, voluntarily and intentionally stipulates, acknowledges and agrees that the advancement of the funds from the Reserves as set forth herein is at Grantor's direction and is not the exercise by Beneficiary of any right of set-off or other remedy upon a Default or an Event of Default. If an Event of Default shall occur hereunder or under any other of the Loan Documents and shall be continuing, Beneficiary may, without notice or demand on Grantor, at its option: (A) withdraw any or all of the funds (including, without limitation, interest) then remaining in the Reserves and apply the same, after deducting all costs and expenses of safekeeping, collection and delivery (including, but not limited to, reasonable attorneys' fees, costs and expenses) to the Debt or any other obligations of Grantor under the other Loan Documents in such manner as Beneficiary shall deem appropriate in its sole discretion, and the excess, if any, shall be paid to Grantor, (B) exercise any and all rights and remedies of a secured party under any applicable Uniform Commercial Code, or (C) exercise any other remedies available at law or in equity. No such use or application of the funds contained in the Reserves shall be deemed to cure any Default or Event of Default. (c) The Reserves shall not, unless otherwise explicitly required by applicable law, be or be deemed to be escrow or trust funds, but, at Beneficiary's option and in Beneficiary's discretion, may either be held in a separate account or be commingled by Beneficiary with the general funds of Beneficiary. The Reserves are solely for the protection of Beneficiary and entail no responsibility on Beneficiary's part beyond the payment of the respective items for which they are held following receipt of bills, invoices or statements therefor in accordance with the terms hereof and beyond the allowing of due credit for the sums actually received. Upon assignment of this Deed of Trust by Beneficiary and assumption by assignee of Beneficiary's obligations hereunder, any funds in the Replacement Reserves shall be turned over to the assignee and any responsibility of Beneficiary, as assignor, with respect thereto shall terminate. If the funds in the applicable Reserve shall exceed the amount of payments actually applied by Beneficiary for the purposes and items for which the applicable Reserve is held, such excess may be credited by Beneficiary on subsequent payments to be made hereunder or, at the option of Beneficiary, refunded to Grantor. If, however, the applicable Reserve shall not contain sufficient funds to pay the sums required by the dates on which such sums are required to be on deposit in such account, Grantor shall, within thirty (30) days after receipt of written notice thereof, deposit with Beneficiary the full amount of any such deficiency. If Grantor shall fail to deposit with Beneficiary the full amount of such deficiency as provided above, Beneficiary shall have the option, but not the obligation, to make such deposit, and all amounts so deposited into by Beneficiary, together with interest bearing accounts of thereon at the type customarily maintained Default Interest Rate from the date so deposited by Mortgagee or its servicing agent for the investment of similar reservesBeneficiary until actually paid by Grantor, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based immediately paid by Grantor on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve demand and shall be disbursed for secured by this Deed of Trust and by all of the other Loan Documents securing all or any part of the Debt. If there is an Event of Default under this Deed of Trust that shall have occurred and be continuing, Beneficiary may, but shall not be obligated to, apply at any time the balance then remaining in any or all of the Reserves against the Debt in whatever order Beneficiary shall subjectively determine. No such application of any or all of the Reserves shall be deemed to cure any Event of Default. Upon full payment of the items for which Debt in accordance with its terms or at such earlier time as Beneficiary may elect, the balance of any or all of the Reserves then in Beneficiary's possession shall be paid over to Grantor and no other funds in the Replacement Reserve are to be disbursedparty shall have any right or claim thereto.

Replacement Reserve. In addition to any other construction, renovation and maintenance requirements set forth in this Agreement, commencing with the first Loan Year, Borrower shall expend at least $250 per unit per year (aexclusive of Insurance Proceeds) As additional security for on maintenance of the DebtProject. To the extent Borrower does not provide evidence, Mortgagor reasonably satisfactory to Lender, that Borrower has spent such sum on a cumulative annual basis, Borrower shall establish and maintain at all times while this Mortgage continues pay Lender such amount not spent. Lender shall hold such sum in effect a capital improvement reserve (the “"Replacement Reserve”") with Mortgagee for payment of costs and Borrower's use to fund future maintenance expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”). Commencing on the first Payment Date under the Note and continuing on each Payment Date thereafter, Mortgagor shall pay to Mortgagee, in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 per month. So long as no Default or Event of Default after Borrower has occurred and is continuing, Mortgagee shall, to the extent funds are available for such purpose spent in the Replacement Reserve, disburse to Mortgagor aggregate at least $52,000 on maintenance of the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) Project during the receipt by Mortgagee of a written then current Loan Year. Each request from Mortgagor for disbursement from the Replacement Reserve shall include copies of invoices for all items or materials purchased and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item all contracted labor or services provided, waivers of Replacement has been completed; (b) the delivery to Mortgagee of invoiceslien from each contractor providing materials, receipts labor or services, and other evidence satisfactory to Mortgagee, verifying the cost Lender of performing the Replacements; (c) for disbursement requests in excess payment of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens such amounts and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of such maintenance to the Replacements and the value of the completed Replacements; and (e) for disbursement requests Project. Borrower hereby grants Lender a first priority security interest in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee all funds contained therein and all products and proceeds thereof and all such funds are pledged as additional collateral for the Loan and Borrower shall be entitled execute any other documents and take any other actions reasonably necessary to rely on provide Lender with such request from Mortgagor without a perfected security interest in such funds. Upon the Maturity Date or at any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or time following an Event of Default shall have occurred and is continuing. In Default, the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds moneys then remaining in the Replacement Reserve to shall, at Lender's option, be deposited into interest bearing accounts of applied against the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then availableIndebtedness. Interest payable on such amounts shall be computed based on the daily outstanding balance All sums held in the Replacement ReserveReserve may be commingled with other borrower reserves held by Lender, and shall not be deemed to be held in trust for the benefit of Borrower. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the The Replacement Reserve shall be retained maintained at a financial institution designated by Mortgagee Lender from time to time, in its sole and accumulated for absolute discretion (so long as such institution's deposits are insured by the benefit of Mortgagor and added to the balance in the Replacement Reserve Federal Deposit Insurance Corporation), and shall be disbursed for under the sole dominion and control of Lender, and Borrower shall have no right to control or direct the investment of payment of the items for which other funds in the Replacement Reserve are to be disbursedtherein.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Borrower shall establish and maintain at all times while this Mortgage continues in effect a capital improvement replacement reserve (the “"Replacement Reserve”") with Mortgagee Lender as additional security for payment repayment of costs the Indebtedness and expenses incurred by Mortgagor in connection with satisfaction of the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles (collectively, the “Replacements”)Obligations. Commencing on the earlier to occur of (i) the Amortization Commencement Date or (ii) the first Payment Date under the Note after an Event of Default and continuing thereafter on each successive Payment Date thereafteruntil the Maturity Date, Mortgagor including during the Extension Period, if applicable, Borrower shall pay to MortgageeLender, in addition to concurrently with the monthly payment due under the Note and until the Debt is fully paid and performedNote, a deposit to the Replacement Reserve in an amount equal to amount equal to $1,163 per month3,208.33. (b) The Replacement Reserve is established for the payment of costs and expenses as may be incurred by Borrower for Replacement Reserve Repairs. So long as no Default or Event of Default has occurred and is continuing, Mortgagee (i) all sums in the Replacement Reserve shall be held by Lender in the Replacement Reserve to pay the costs and expenses of Replacement Reserve Repairs, and (ii) Lender shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount Borrower, as Lender may approve, in Lender's reasonable discretion, amounts paid or incurred by Mortgagor in Borrower and performing Replacements such Replacement Reserve Repairs within ten (10) days following: (a) the receipt by Mortgagee Lender of a written request from Mortgagor Borrower for a disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee from Borrower to Lender that the applicable item of Replacement Reserve Repair has been completed; (b) the delivery to Mortgagee Lender of invoices, receipts or of other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacementssuch Replacement Reserve Repairs; and (c) for in the case of a disbursement requests request from the Replacement Reserve in excess of $25,00025,000 with respect to any single Replacement Reserve Repair, the delivery to Mortgagee Lender of (1) affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee Lender showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material materials or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e2) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new (or amended) certificate of occupancy for the portion of the Improvements covered by such ReplacementsReplacement Reserve Repairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Borrower that no new certificate of occupancy is requiredrequired by law. Mortgagee Lender shall not be required or requested to make advances from the Replacement Reserve more frequently than once one time in any sixty (60) day periodcalendar month. In making any payment from the Replacement Reserve, Mortgagee Lender shall be entitled to rely on such request from Mortgagor Borrower without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee . (c) Lender may, at Mortgagor’s Borrower's expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the adequacy of the scheduled deposits into the Replacement Reserve and the need, as determined by Mortgagee Lender in its reasonable judgment, for further Replacements of Replacement Reserve Repairs to the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Replacement Reserve Repairs of the Mortgaged Property are required, Mortgagee then, in addition to any other remedy Lender may be entitled to hereunder, Lender shall provide Mortgagor Borrower with a written description of the required Replacements Replacement Reserve Repairs and Mortgagor Borrower shall complete such Replacements Replacement Reserve Repairs to the reasonable satisfaction of Mortgagee Lender within one hundred twenty ninety (12090) days after the receipt of such description from MortgageeLender, or such later date as may be approved by Mortgagee Lender in its reasonable discretion. Additionally, Lender may, as a product of any such inspection, require that the amount of the scheduled monthly deposits into the Replacement Reserve described in subsection (a) above be increased in order to accommodate Lender's estimation, in Lender's sole discretion. (b) Mortgagee shall cause funds , of the likely increased cost of future Replacement Reserve Repairs. In the event that the amount on deposit and available in the Replacement Reserve is ever inadequate to be deposited into interest bearing accounts pay the cost of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by MortgagorRepairs, Borrower shall pay the amount of such deficiency. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.EXHIBIT B, Special Provisions Debt Service Coverage Ratio Calculation Methodology – Page 4 667404; Miami-Dade County – Florida

Replacement Reserve. (a) As additional security for the Debt, Mortgagor shall establish and maintain at all times while this Mortgage continues in effect a capital improvement repair reserve (the “"Replacement Reserve”") with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work which would normally be treated as a capital improvement under generally accepted accounting principles to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators, lighting, ballasts, lamps and mechanical and HVAC equipment (collectively, the “Replacements”"Repairs"). Commencing on the first Payment Date monthly payment date under the Note and continuing thereafter on each Payment Date thereaftermonthly payment date under the Note, Mortgagor shall pay to Mortgagee, concurrently with and in addition to the monthly payment due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 1,044.51 per month. So long as no Default default hereunder or Event under the other Loan Documents has occurred and is continuing, all sums in the Replacement Reserve shall be held by Mortgagee in the Replacement Reserve to pay the costs and expenses of Default Repairs. So long as no default hereunder or under the other Loan Documents has occurred and is continuing, Mortgagee shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests in excess of $25,00020,000.00, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens materialmen, laborers, subcontractors and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made during the term of this Mortgage an annual inspection of the Mortgaged Property to determine the need, as determined by Mortgagee in its reasonable judgment, for further Replacements of the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve are to be disbursed.any

Replacement Reserve. (a) As additional security for At the DebtConversion Date, Mortgagor Borrower shall establish and maintain at all times while this Mortgage continues in effect a capital improvement reserve (deposit with *Senior Lender or the “Replacement Reserve”) with Mortgagee for payment of costs and expenses incurred by Mortgagor in connection with the performance of work Escrow Agent $qcq, which would normally funds will be treated used as a capital improvement under generally accepted accounting principles (collectivelyreplacement reserve. Thereafter, the “Replacements”). Commencing beginning on the first Payment day of the first full month after the Conversion Date under the Note and continuing on the same day of each Payment Date thereaftersubsequent month until the Loan is paid in full or the Compliance Period expires, Mortgagor whichever is later, Borrower shall pay to Mortgageedeposit $qc with *Senior Lender or the Escrow Agent, in addition which amounts shall be added to the monthly payment due under the Note and until the Debt is fully paid and performedreplacement reserve; provided, a deposit to the Replacement Reserve in an amount equal to $1,163 per month. So long as no Default or Event of Default has occurred and is continuinghowever, Mortgagee shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor the amount paid or incurred by Mortgagor in performing Replacements within ten (10) days following: (a) the receipt by Mortgagee of a written request from Mortgagor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee that the applicable item of Replacement has been completed; (b) the delivery to Mortgagee of invoices, receipts or other evidence satisfactory to Mortgagee, verifying the cost of performing the Replacements; (c) for disbursement requests in excess of $25,000, the delivery to Mortgagee of affidavits, lien waivers or other evidence reasonably satisfactory to Mortgagee showing that all parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Property have been paid all amounts due for labor and materials furnished to the Mortgaged Property; (d) for disbursement requests in excess of $25,000, delivery to Mortgagee of a certification from an inspecting architect or other third party acceptable to Mortgagee describing the completed Replacements and verifying the completion of the Replacements and the value of the completed Replacements; and (e) for disbursement requests in excess of $50,000, delivery to Mortgagee of a new certificate of occupancy for the portion of the Improvements covered by such Replacements, if said new certificate of occupancy is required by law, or a certification by Mortgagor that no new certificate of occupancy is required. Mortgagee shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty (60) day period. In making any payment from the Replacement Reserve, Mortgagee shall be entitled to rely on such request from Mortgagor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee may, at Mortgagor’s expense, make or cause to be made each year during the term of this Mortgage an annual inspection the Loan on the anniversary date of the Mortgaged Property to determine Conversion Date the need, as determined monthly amount due under this section shall increase by Mortgagee in its reasonable judgment, for further Replacements of 3% over the Mortgaged Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements of the Mortgaged Property are required, Mortgagee shall provide Mortgagor with a written description of the required Replacements and Mortgagor shall complete such Replacements to the reasonable satisfaction of Mortgagee within one hundred twenty (120) days after the receipt of such description from Mortgagee, or such later date as may be approved by Mortgagee in its sole discretion. (b) Mortgagee shall cause funds in the Replacement Reserve to be deposited into interest bearing accounts of the type customarily maintained by Mortgagee or its servicing agent amount payable for the investment of similar reserves, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagorprior year. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve and shall be disbursed for payment of the items for which other funds in the Replacement Reserve reserve shall be part of the reserve. The funds in the replacement reserve shall only be used to replace or make capital improvements to the Premises (as defined below). Before Borrower may draw on the replacement reserve, Borrower must notify Lender in writing, explain the need for the withdrawal, and receive ▇▇▇▇▇▇’s approval of the withdrawal, which approval will not be unreasonably withheld. When all amounts due under the Loan Documents are paid in full or when the Compliance Period has expired, whichever is later, the Escrow Agent (if it is holding this reserve) shall release to Borrower the amount remaining in the replacement reserve (if any). As used in this section, “capital improvements” means improvements to the Premises, the cost of which would exceed $10,000.00, such as re-roofing, structural repairs, or major projects to replace or upgrade existing furnishings, equipment, or fixtures, but not including replacement of individual appliances or minor repairs. *Even though Senior Lender may be disbursedholding the replacement reserve, Borrower may not draw on the replacement reserve without ▇▇▇▇▇▇’s prior written consent, which consent will not be unreasonably withheld, and ▇▇▇▇▇▇▇▇’s failure to obtain such consent shall be deemed a material breach of this Agreement, notwithstanding Senior Lender’s disbursement of funds from the replacement reserve.

Replacement Reserve. (a) As additional security for the Debt, Mortgagor Grantor shall establish and maintain at all times while this Mortgage Deed of Trust continues in effect a capital improvement repair and replacement reserve (the “"Replacement Reserve”") with Mortgagee Beneficiary for payment of costs and expenses incurred by Mortgagor Grantor in connection with the performance of work which would normally be treated related to the maintenance, replacement and/or repair of the Trust Property, including without limitation, work to the roofs, chimneys, gutters, downspouts, paving, curbs, ramps, driveways, balconies, porches, patios, exterior walls, exterior doors and doorways, windows, elevators and mechanical and HVAC equipment and such other work as a capital improvement under generally accepted accounting principles Grantor deems necessary or appropriate (collectively, the “Replacements”"Repairs"). Commencing on the first monthly Payment Date under the Note and continuing thereafter on each monthly Payment Date thereafterunder the Note, Mortgagor Grantor shall pay to MortgageeBeneficiary, concurrently with and in addition to the monthly payment payments due under the Note and until the Debt is fully paid and performed, a deposit to the Replacement Reserve in an amount equal to $1,163 5,375.00 per month. So long as no Event of Default has occurred and is continuing, all sums in the Replacement Reserve shall be held by Beneficiary in the Replacement Reserve to pay the costs and expense of Repairs. So long as no Default or Event of Default has occurred and is continuing, Mortgagee Beneficiary shall, to the extent funds are available for such purpose in the Replacement Reserve, disburse to Mortgagor Grantor the amount paid or incurred by Mortgagor Grantor in performing Replacements such Repairs within ten (10) days following: (a) the receipt by Mortgagee Beneficiary of a written request from Mortgagor Grantor for disbursement from the Replacement Reserve and a certification by Mortgagor in a form approved in writing by Mortgagee Grantor that the applicable item of Replacement Repair has been completed; (b) the delivery to Mortgagee Beneficiary of invoices, receipts receipts, cancelled checks or other evidence reasonably satisfactory to MortgageeBeneficiary, verifying the cost of performing the ReplacementsRepairs; (c) for disbursement requests with individual items costing in excess of $25,00050,000.00, the delivery to Mortgagee Beneficiary of affidavits, lien waivers waivers, cancelled checks or other evidence reasonably satisfactory to Mortgagee Beneficiary showing that all materialmen, laborers, subcontractors and any other parties who might or could claim statutory or common law liens and are furnishing or have furnished material or labor to the Mortgaged Trust Property have been paid all amounts due for labor and materials furnished to the Mortgaged Trust Property; (d) for disbursement requests with individual items costing in excess of $25,00050,000.00, delivery to Mortgagee Beneficiary of a certification from an inspecting architect or other a third party acceptable to Mortgagee Beneficiary describing the completed Replacements Repairs and verifying the completion of the Replacements Repairs and the value of the completed ReplacementsRepairs; and (e) for disbursement requests with individual items costing in excess of $50,00050,000.00, delivery to Mortgagee Beneficiary of a new certificate of occupancy or local equivalent for the portion of the Improvements covered by such ReplacementsRepairs, if said new certificate of occupancy is required by law, or a certification by Mortgagor Grantor that no new certificate of occupancy is required. Mortgagee Beneficiary shall not be required to make advances from the Replacement Reserve more frequently than once in any sixty ninety (6090) day period. In making any payment from the Replacement Reserve, Mortgagee Beneficiary shall be entitled to rely on such request from Mortgagor Grantor without any inquiry into the accuracy, validity or contestability of any such amount. Mortgagee Beneficiary may, at Mortgagor’s Grantor's expense, make or cause to be made during the term of this Mortgage ▇▇▇▇ ▇▇ Trust an annual inspection of the Mortgaged Trust Property to determine the need, as determined by Mortgagee Beneficiary in its reasonable judgment, for further Replacements Repairs of the Mortgaged Trust Property; such inspection to be no more frequent than once in any calendar year unless a Default or an Event of Default shall have occurred and is continuing. In the event that such inspection reveals that further Replacements Repairs of the Mortgaged Trust Property are required, Mortgagee Beneficiary shall provide Mortgagor Grantor with a written description of the required Replacements Repairs and Mortgagor Grantor shall complete such Replacements to the reasonable satisfaction of Mortgagee respond within one hundred twenty thirty (12030) days after the receipt of such description from Mortgageerequest, or and, thereafter, Grantor shall make such later date Repairs, as may be approved mutually agreed upon by Mortgagee Grantor and Beneficiary and within such time period as may be mutually agreed upon. Funds contained in its sole discretionthe Replacement Reserve shall be placed in an interest-bearing account upon receipt and interest thereon credited to Grantor as provided in Section 4.31 hereof. (b) Mortgagee As additional security for the payment and performance by Grantor of all duties, responsibilities and obligations under the Note and the other Loan Documents, Grantor hereby unconditionally and irrevocably assigns, conveys, pledges, mortgages, transfers, delivers, deposits, sets over and confirms unto Beneficiary, and hereby grants to Beneficiary a security interest in Grantor's right, title and interest in, (i) the Impound Account, the Replacement Reserve, the Repair and Remediation Reserve and any other reserve or escrow account established pursuant to the terms hereof or of any other Loan Document (collectively, the "Reserves"), (ii) the accounts into which the Reserves have been deposited, (iii) all insurance on said accounts, (iv) all accounts, contract rights and general intangibles or other rights and interests pertaining thereto, (v) all sums now or hereafter therein or represented thereby, (vi) all replacements, substitutions or proceeds thereof, (vii) all instruments and documents now or hereafter evidencing the Reserves or such accounts, (viii) all powers, options, rights, privileges and immunities pertaining to the Reserves (including the right to make withdrawals therefrom), and (ix) all proceeds of the foregoing. Grantor hereby authorizes and consents to the account into which the Reserves have been deposited being held in Beneficiary's name or the name of any entity servicing the Note for Beneficiary and hereby acknowledges and agrees that Beneficiary, or at Beneficiary's election, such servicing agent, shall cause have exclusive control over said account. Notice of the assignment and security interest granted to Beneficiary herein may be delivered by Beneficiary at any time to the financial institution wherein the Reserves have been established, and Beneficiary, or such servicing entity, shall have possession of all passbooks or other evidences of such accounts. Grantor hereby assumes all risk of loss with respect to amounts on deposit in the Reserves, unless finally determined by a court of competent jurisdiction to have been caused by the gross negligence or willful misconduct of Beneficiary. Grantor hereby knowingly, voluntarily and intentionally stipulates, acknowledges and agrees that the advancement of the funds from the Reserves as set forth herein is at Grantor's direction and is not the exercise by Beneficiary of any right of set-off or other remedy upon a Default or an Event of Default. If an Event of Default shall occur hereunder or under any other of the Loan Documents and shall be continuing, Beneficiary may, without notice or demand on Grantor, at its option: (A) withdraw any or all of the funds (including, without limitation, interest) then remaining in the Reserves and apply the same, after deducting all costs and expenses of safekeeping, collection and delivery (including, but not limited to, reasonable attorneys' fees, costs and expenses) to the Debt or any other obligations of Grantor under the other Loan Documents in such manner as Beneficiary shall deem appropriate in its sole discretion, and the excess, if any, shall be paid to Grantor, (B) exercise any and all rights and remedies of a secured party under any applicable Uniform Commercial Code, or (C) exercise any other remedies available at law or in equity. No such use or application of the funds contained in the Reserves shall be deemed to cure any Default or Event of Default. (c) The Reserves shall not, unless otherwise explicitly required by applicable law, be or be deemed to be escrow or trust funds, but, at Beneficiary's option and in Beneficiary's discretion, may either be held in a separate account or be commingled by Beneficiary with the general funds of Beneficiary. The Reserves are solely for the protection of Beneficiary and entail no responsibility on Beneficiary's part beyond the payment of the respective items for which they are held following receipt of bills, invoices or statements therefor in accordance with the terms hereof and beyond the allowing of due credit for the sums actually received. Upon assignment of this Deed of Trust by Beneficiary and assumption by assignee of Beneficiary's obligations hereunder, any funds in the Replacement Reserves shall be turned over to the assignee and any responsibility of Beneficiary, as assignor, with respect thereto shall terminate. If the funds in the applicable Reserve shall exceed the amount of payments actually applied by Beneficiary for the purposes and items for which the applicable Reserve is held, such excess may be credited by Beneficiary on subsequent payments to be made hereunder or, at the option of Beneficiary, refunded to Grantor. If, however, the applicable Reserve shall not contain sufficient funds to pay the sums required by the dates on which such sums are required to be on deposit in such account, Grantor shall, within thirty (30) days after receipt of written notice thereof, deposit with Beneficiary the full amount of any such deficiency. If Grantor shall fail to deposit with Beneficiary the full amount of such deficiency as provided above, Beneficiary shall have the option, but not the obligation, to make such deposit, and all amounts so deposited into by Beneficiary, together with interest bearing accounts of thereon at the type customarily maintained Default Interest Rate from the date so deposited by Mortgagee or its servicing agent for the investment of similar reservesBeneficiary until actually paid by Grantor, which accounts may not yield the highest interest rate then available. Interest payable on such amounts shall be computed based immediately paid by Grantor on the daily outstanding balance in the Replacement Reserve. Such interest shall be calculated on a simple, non-compounded interest basis based solely on contributions made to the Replacement Reserve by Mortgagor. All interest earned on amounts contributed to the Replacement Reserve shall be retained by Mortgagee and accumulated for the benefit of Mortgagor and added to the balance in the Replacement Reserve demand and shall be disbursed for secured by this Deed of Trust and by all of the other Loan Documents securing all or any part of the Debt. If there is an Event of Default under this Deed of Trust that shall have occurred and be continuing, Beneficiary may, but shall not be obligated to, apply at any time the balance then remaining in any or all of the Reserves against the Debt in whatever order Beneficiary shall subjectively determine. No such application of any or all of the Reserves shall be deemed to cure any Event of Default. Upon full payment of the items for which Debt in accordance with its terms or at such earlier time as Beneficiary may elect, the balance of any or all of the Reserves then in Beneficiary's possession shall be paid over to Grantor and no other funds in the Replacement Reserve are to be disbursedparty shall have any right or claim thereto.