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200507874
<br />(a) Lien Priority. This Security Instrument is a valid and enforceable first lien on the Property, free
<br />and clear of all encumbrances and liens having priority over the lien of this Security Instrument, except for office
<br />equipment such as computers, facsimile machines and copiers leased in the normal course of Borrower's business,
<br />with an aggregate value not to exceed $5,000 and except for the items set forth as exceptions to or subordinate
<br />matters in the title insurance policy insuring the lien of this Security Instrument and other items disclosed to Lender
<br />in a disclosure statement delivered by Borrower to Lender in connection with the origination of the Loan, none of
<br />which, individually or in the aggregate, materially interfere with the benefits of the security intended to be provided
<br />by this Security Instrument, materially affect the value or marketability of the Property, impair the use or operation
<br />of the Property for the use currently being made thereof or impair Borrower's ability to pay its obligations in a
<br />timely manner (such items being the "Permitted Encumbrances ").
<br />(b) Title. Fee Owner has, subject only to the Permitted Encumbrances, good, insurable and
<br />marketable fee simple title to the Premises, Improvements and Fixtures (collectively, the "Real ") and Lessee has,
<br />subject only to Permitted Encumbrances, good, insurable and marketable leasehold title to the Realty and, in each
<br />case, to all easements and rights benefiting the Realty and has the right, power and authority to mortgage, encumber,
<br />give, grant, bargain, sell, alien, enfeoff, convey, confirm, pledge, assign, and hypothecate the Property. Borrower
<br />will preserve its interest in and title to the Property and will forever warrant and defend the same to Lender against
<br />any and all claims made by, through or under Borrower and will forever warrant and defend the validity and priority
<br />of the lien and security interest created herein against the claims of all Persons whomsoever claiming by, through or
<br />under Borrower. The foregoing warranty of title shall survive the foreclosure of this Security Instrument and shall
<br />inure to the benefit of and be enforceable by Lender in the event Lender acquires title to the Property pursuant to any
<br />foreclosure. In addition, there are no outstanding options or rights of first refusal to purchase the Property or
<br />Borrower's ownership thereof.
<br />(c) Taxes and IM positions. All taxes and other Impositions and governmental assessments due and
<br />owing in respect of, and affecting, the Property have been paid. Borrower has paid all Impositions which constitute
<br />special governmental assessments in full, except for those assessments which are permitted by applicable Legal
<br />Requirements to be paid in installments, in which case all installments which are due and payable have been paid in
<br />full. There are no pending, or to Borrower's best knowledge, proposed special or other assessments for public
<br />improvements or otherwise affecting the Property, nor are there any contemplated improvements to the Property that
<br />may result in such special or other assessments.
<br />(d) Casualm Flood Zone. The Realty is in good repair and free and clear of any damage, destruction
<br />or casualty (whether or not covered by insurance) that would materially affect the value of the Realty or the use for
<br />which the Realty was intended, there exists no structural or other material defects or damages in or to the Property
<br />and Borrower has not received any written notice from any insurance company or bonding company of any material
<br />defect or inadequacies in the Property, or any part thereof, which would materially and adversely affect the
<br />insurability of the same or cause the imposition of extraordinary premiums or charges thereon or of any termination
<br />or threatened termination of any policy of insurance or bond. No portion of the Premises is located in an "area of
<br />special flood hazard," as that term is defined in the regulations of the Federal Insurance Administration, Department
<br />of Housing and Urban Development, under the National Flood Insurance Act of 1968, as amended (24 CFR
<br />§ 1909.1) or Borrower has obtained the flood insurance required by Section 3.01(a)(vi) hereof. The Premises either
<br />does not lie in a 100 year flood plain that has been identified by the Secretary of Housing and Urban Development
<br />or any other Governmental Authority or, if it does, Borrower has obtained the flood insurance required by Section
<br />3.01(a)(vi) hereof.
<br />(e) Completion: Encroachment. All Improvements necessary for the efficient use and operation of the
<br />Premises, including, without limitation, all Improvements which were included for purposes of determining the
<br />appraised value of the Property in the Appraisal, have been completed and none of said Improvements lie outside the
<br />boundaries and building restriction lines of the Premises except for de- minimis encroachments on adjoining
<br />properties as disclosed in the survey provided to Lender in connection with the origination of the Loan. Except as
<br />set forth in the title insurance policy insuring the lien of this Security Instrument, no improvements on adjoining
<br />properties encroach upon the Premises.
<br />M-11
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