-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, KY1Dpd+YHxig4kVy2Rmdpmae5NS+WY75RmgqhCM8MjGc39war6RD3W53H54Hq5az 2DesMxEsf9sF2oP8BEFNDQ== 0000892626-94-000023.txt : 19940330 0000892626-94-000023.hdr.sgml : 19940330 ACCESSION NUMBER: 0000892626-94-000023 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 8 CONFORMED PERIOD OF REPORT: 19931231 FILED AS OF DATE: 19940329 FILER: COMPANY DATA: COMPANY CONFORMED NAME: JMB INCOME PROPERTIES LTD XIII CENTRAL INDEX KEY: 0000790603 STANDARD INDUSTRIAL CLASSIFICATION: 6500 IRS NUMBER: 363426137 STATE OF INCORPORATION: IL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: 34 SEC FILE NUMBER: 000-19496 FILM NUMBER: 94518456 BUSINESS ADDRESS: STREET 1: 900 N MICHIGAN AVE CITY: CHICAGO STATE: IL ZIP: 60611 BUSINESS PHONE: 3129151987 10-K 1 1993 10K REPORT SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 1993 Commission file no. 000-19496 JMB INCOME PROPERTIES, LTD. - XIII (Exact name of registrant as specified in its charter) Illinois 36-3426137 (State of organization) (I.R.S. Employer Identification No.) 900 N. Michigan Ave., Chicago, Illinois 60611 (Address of principal executive office) (Zip Code) Registrant's telephone number, including area code 312-915-1987 Securities registered pursuant to Section 12(b) of the Act: Name of each exchange on Title of each class which registered - ------------------- ------------------------------- None None Securities registered pursuant to Section 12(g) of the Act: LIMITED PARTNERSHIP INTERESTS (Title of class) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Park III of this Form 10-K or any amendment to this Form 10-K - X State the aggregate market value of the voting stock held by non-affiliates of the registrant. Not applicable. Certain pages of the prospectus of the registrant dated August 20, 1986, as supplemented October 31, 1986 and January 26, 1987 and filed pursuant to Rules 424(b) and 424(c) under the Securities Act of 1933 are incorporated by reference in Parts I and III of this Annual Report on Form 10-K. TABLE OF CONTENTS Page ---- PART I Item 1. Business. . . . . . . . . . . . . . . . . . . . 1 Item 2. Properties. . . . . . . . . . . . . . . . . . . 4 Item 3. Legal Proceedings . . . . . . . . . . . . . . . 6 Item 4. Submission of Matters to a Vote of Security Holders. . . . . . . . . . . . . . . . 6 PART II Item 5. Market for the Partnership's Limited Partnership Interests and Related Security Holder Matters . . . . . . . . . . . . 6 Item 6. Selected Financial Data . . . . . . . . . . . . 7 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . . . . 13 Item 8. Financial Statements and Supplementary Data . . 18 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. . . . . 43 PART III Item 10. Directors and Executive Officers of the Partnership. . . . . . . . . . . . . . . 43 Item 11. Executive Compensation. . . . . . . . . . . . . 46 Item 12. Security Ownership of Certain Beneficial Owners and Management . . . . . . . . . . . . . 47 Item 13. Certain Relationships and Related Transactions. 48 PART IV Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K . . . . . . . . . . . . 48 SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . 50 i PART I Item 1. Business All references to "Notes" are to Notes to Consolidated Financial Statements contained in this report. The registrant, JMB Income Properties, Ltd. - XIII (the "Partnership"), is a limited partnership formed in 1986 and currently governed by the Revised Uniform Limited Partnership Act of the State of Illinois to invest in income-producing properties, primarily existing commercial real properties. On August 20, 1986, the Partnership commenced an offering to the public of $100,000,000 (subject to increase by up to $250,000,000) in Limited Partnership Interests (the "Interests") pursuant to a Registration Statement on Form S-11 under the Securities Act of 1933 (Registration No. 33-4107). A total of 126,409 Interests (at an offering price of $1,000 per Interest, before discounts) were sold to the public and were issued to investors during 1987. The offering closed on April 14, 1987. No investor has made any additional capital contribution after such date. The investors in the Partnership share in their portion of the benefits of ownership of the Partnership's real property investments according to the number of Interests held. The Partnership is engaged solely in the business of the acquisition, operation, and sale and disposition of equity real estate investments. Such equity investments are held by fee title and/or through joint venture partnership interests. The Partnership's real property investments are located throughout the nation, and it has no real estate investments located outside the United States. A presentation of information about industry segments, geographic regions, raw materials or seasonality is not applicable and would not be material to an understanding of the Partnership's business taken as a whole. Pursuant to the Partnership Agreement, the Partnership is required to terminate on or before October 31, 2036. Accordingly, the Partnership intends to hold the real properties it acquires for investment purposes until such time as a sale or other disposition appears to be advantageous. Unless otherwise described, the Partnership expects to hold its properties for long-term investment where, due to current market conditions, it is impossible to forecast the expected holding period. At the sale of a particular property, the proceeds, if any, are generally distributed or reinvested in existing properties rather than invested in acquiring additional properties. The Partnership has made the real property investments set forth in the following table:
SALE OR DISPOSITION DATE OR IF OWNED AT DECEMBER 31, 1993, NAME, TYPE OF PROPERTY DATE OF ORIGINAL INVESTED AND LOCATION (f) SIZE PURCHASE CAPITAL PERCENTAGE (a) TYPE OF OWNERSHIP - ---------------------- ---------- -------- ---------------------- --------------------- 1. Mid Rivers Mall St. Peters (St. Louis), Missouri . . . . . . . . 323,100 sq.ft. 12/12/86 1/30/92 Fee ownership of land and g.l.a. improvements (through joint venture partnerships) (c)(d) 2. First Financial Plaza Office Building Encino (Los Angeles), California . . . . . . . 216,000 sq.ft. 5/20/87 8% Fee ownership of land and n.r.a. improvements (through joint venture partnerships) (c) 3. Miami International Mall Miami, Florida . . . . . 967,300 sq.ft. 1/1/88 11% Fee ownership of land and g.l.a. improvements (through joint venture partnerships) (c) 4. Rivertree Court Shopping Center Vernon Hills (Chicago), Illinois . . . . . . . . 297,000 sq.ft. 10/20/88 23% Fee ownership of land and g.l.a. improvements (b)(e) 5. Fountain Valley Industrial Park Industrial Buildings Fountain Valley (Los Angeles), California 393,100 sq.ft. 11/1/88 16% Fee ownership of land and b.a. improvements (b)(e) 6. Cerritos Industrial Park Industrial Buildings Cerritos (Los Angeles), California . . . . . . . 197,100 sq.ft. 11/1/88 7% Fee ownership of land and b.a. improvements (b) 7. Adams/Wabash Self Park Chicago, Illinois. . . . 671 spaces and 10/1/90 25% Fee ownership of land and 28,800 improvements (through sq.ft. n.r.a. joint venture partnership) (c) - ----------------------- (a) The computation of this percentage for properties held at December 31, 1993 does not include amounts invested from sources other than the original net proceeds of the public offering as described above and in Item 7. (b) Reference is made to Note 4 and to Schedule XI filed with this annual report for the current outstanding principal balances and a description of the long-term mortgage indebtedness secured by the Partnership's real property investments. (c) Reference is made to Note 3 filed with this annual report for a description of the joint venture partnerships through which the Partnership made this real property investment. (d) This property was sold January 30, 1992. Reference is made to Note 7 of Notes to Consolidated Financial Statements filed with this annual report for a description of the sale of such real property investment. (e) Reference is made to Item 6 - Selected Financial Data for additional operating and lease expiration data concerning this investment property. (f) Reference is made to Item 8 - Schedules X and XI filed with the annual report for further information concerning real estate taxes and depreciation.
The Partnership's real property investments are subject to competition from similar types of properties (including, in certain areas, properties owned or advised by affiliates of the General Partners) in the vicinities in which they are located. Such competition is generally for the retention of existing tenants. Additionally, the Partnership is in competition for new tenants in markets where significant vacancies are present. Reference is made to Item 7 below for a discussion of competitive conditions and future renovation and capital improvement plans of the Partnership and certain of its significant investment properties. Approximate occupancy levels for the properties are set forth in Item 2 below to which reference is hereby made. The Partnership maintains the suitability and competitiveness of its properties in its markets primarily on the basis of effective rents, tenant allowances and service provided to tenants. In the opinion of the Managing General Partner of the Partnership, all of the investment properties held at December 31, 1993 are adequately insured. Although there is earthquake insurance coverage for a portion of the value of the Partnership's investment properties, the Managing General Partner does not believe that such coverage for the entire replacement cost of the investment properties is available on economic terms. Reference is made to Note 8 for a schedule of minimum lease payments to be received in each of the next five years, and in the aggregate thereafter, under leases in effect at the Partnership's consolidated properties as of December 31, 1993. The Partnership has no employees. The terms of transactions between the Partnership, the General Partners and their affiliates are set forth in Item 11 below to which reference is hereby made for a description of such terms and transactions. Item 2. Properties The Partnership owns directly or through joint venture partnerships the properties or interests in the properties referred to under Item 1 above to which reference is hereby made for a description of said properties. The following is a listing of principal businesses or occupations carried on in and approximate occupancy levels by quarter during fiscal years 1993 and 1992 for the Partnership's investment properties owned during 1993:
1992 1993 ------------------------------- ------------------------------ At At At At At At At At Principal Business 3/31 6/30 9/30 12/31 3/31 6/30 9/30 12/31 ------------------ ---- ---- ---- ----- ---- ---- ----- ----- 1. First Financial Plaza Encino (Los Angeles), California. . . University/Bank/ Housing Developer 92% 89% 87% 85% 85% 88% 84%(1) 85%(1) 2. Miami International Mall Miami, Florida. . . . . . . . . . . . Retail 91% 93% 94% 94% 94% 95% 97% 98% 3. Rivertree Court Shopping Center Vernon Hills (Chicago), Illinois. . . Retail 84% 95% 90% 90% 98% 98% 98% 97% 4. Fountain Valley Industrial Park Fountain Valley (Los Angeles), California. . . . . . . . . . . . . . Retail/Lighting Systems Manufac- turer/Nuts and Bolts Distributor 58%(2) 65%(2) 74%(2) 74%(2) 69%(2) 63%(2) 85%(2) 85%(2) 5. Cerritos Industrial Park Cerritos (Los Angeles), California. . . . . . . . . . . . . . Aircraft Parts Manufacturer/Spa Manufacturer/ Tire Distributor 70% 77% 91% 84% 93% 100% 100% 100% 6. Adams/Wabash Self Park Chicago, Illinois . . . . . . . . . . Parking Garage * * * * * * * * - -------------------- An asterisk indicates that the property is primarily a parking garage and occupancy information is not applicable. However, the approximate occupancy level for the retail portion of the structure as of December 31, 1993 is 47%. (1) The percentage represents physical occupancy. Mitsubishi (8,109 square feet) vacated its space in July 1993 prior to its lease expiration of January 1997 and continues to pay rent pursuant to its lease obligation. Including the Mitsubishi lease and recently executed leases, First Financial Plaza is 87% and 91% leased as of September 31, 1993 and December 31, 1993, respectively. (2) The percentage represents physical occupancy. Newport Corporation (102,054 square feet) vacated its space in March 1992, prior to its lease expiration of May 31, 1995 and has continued to pay rent pursuant to its lease obligations. In the third quarter of 1993, 77,028 square feet was re-leased to Fry's Electronics, and 25,026 square feet has been leased to a sub-tenant. Therefore, from the first quarter of 1992 through the second quarter of 1993, the property has been 26% greater leased than occupied. Reference is made to Item 6, Item 7 and Note 8 for further information regarding property occupancy, competitive conditions and tenant leases at the Partnership's investment properties.
ITEM 3. LEGAL PROCEEDINGS The Partnership is not subject to any material pending legal proceedings. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS There were no matters submitted to a vote of holders of Interests during fiscal years 1993 and 1992. PART II ITEM 5. MARKET FOR THE PARTNERSHIP'S LIMITED PARTNERSHIP INTERESTS AND RELATED SECURITY HOLDER MATTERS As of December 31, 1993, there were 9,335 record holders of Interests of the Partnership. There is no public market for Interests, and it is not anticipated that a public market for Interests will develop. Upon request, the Managing General Partner may provide information relating to a prospective transfer of Interests to an investor desiring to transfer his Interests. The price to be paid for the Interests, as well as any other economic aspects of the transaction, will be subject to negotiation by the investor. However, there are restrictions governing the transferability of these Interests as described in "Transferability of Partnership Interests" on pages A-31 to A-33 of the Partnership Agreement. Reference is made to Item 6 below for a discussion of cash distributions made to the Limited Partners. ITEM 6. SELECTED FINANCIAL DATA JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE YEARS ENDED DECEMBER 31, 1993, 1992, 1991, 1990 AND 1989 (NOT COVERED BY INDEPENDENT AUDITORS' REPORT)
1993 1992 1991 1990 1989 ------------ ------------ ------------ ------------ ------------ Total income . . . . . . . . . . . . . . . $ 12,292,002 11,140,476 10,134,959 10,337,178 9,378,455 ============ ============ ============ ============ =========== Operating earnings . . . . . . . . . . . . $ 3,179,510 2,206,794 836,374 2,558,774 2,984,452 Partnership's share of operations of unconsolidated ventures. . . . . . . . (157,847) (251,748) (469,751) 73,821 (57,695) ------------ ------------ ------------ ------------ ------------ Net operating earnings . . . . . . . . 3,021,663 1,955,046 366,623 2,632,595 2,926,757 Partnership's share of gain on sale of investment property and gain on sale of land from unconsolidated venture . . . . 346,208 6,366,463 -- -- -- ------------ ------------ ------------ ------------ ------------ Net earnings before partnership's share of extraordinary item from unconsolidated venture. . . . . . . . . . . . . . . . . 3,367,871 8,321,509 366,623 2,632,595 2,926,757 Partnership's share of extraordinary item from unconsolidated venture. . . . . . . (521,183) -- -- -- -- ------------ ------------ ------------ ------------ ------------ Net earnings . . . . . . . . . . . . . . . $ 2,846,688 8,321,509 366,623 2,632,595 2,926,757 ============ ============ ============ ============ =========== Net earnings per Interest (b): Net operating earnings . . . . . . . . . $ 22.95 14.85 2.78 19.99 22.23 Partnership's share of gain on investment property and share of gain on sale of land from unconsolidated venture. . . . . . . . . 2.71 49.86 -- -- -- Partnership's share of extraordinary item from unconsolidated venture. . . . (3.96) -- -- -- -- ------------ ------------ ------------ ------------ ------------ Net earnings per Interest. . . . . . . $ 21.70 64.71 2.78 19.99 22.23 ============ ============ ============ ============ =========== Total assets . . . . . . . . . . . . . . . $113,581,933 115,959,504 119,093,611 123,698,536 128,944,388 Long-term debt . . . . . . . . . . . . . . $ 26,700,000 15,700,000 26,700,000 26,700,000 26,700,000 Cash distributions per Interest (c). . . . $ 40.00 85.00 43.50 54.00 54.00 ============ ============ ============ ============ =========== - ------------- (a) The above selected financial data should be read in conjunction with the financial statements and the related notes appearing elsewhere in this annual report. (b) The net earnings per Interest is based upon the Interests outstanding at the end of each period (126,414). (c) Cash distributions to the Limited Partners since the inception of the Partnership have not resulted in taxable income to such Limited Partners and have therefore represented a return of capital. Each partner's taxable income (loss) from the Partnership in each year is equal to his allocable share of the taxable income (loss) of the Partnership, without regard to the cash generated or distributed by the Partnership.
SIGNIFICANT PROPERTY - SELECTED RENTAL AND OPERATING DATA AS OF DECEMBER 31, 1993
Property - -------- Fountain Valley Industrial Park a) The GLA historical occupancy rate and average base rent per square foot for the last five years were as follows: Year Ending GLA Avg. Base Rent Per December 31, Occupancy Rate (1) Square Foot (2) ------------ ----------------- ------------------ 1989 . . . . . 87% $4.79 1990 . . . . . 100% 5.10 1991 . . . . . 84% 5.47 1992 . . . . . 74% 5.96 1993 . . . . . 85% 5.31 (1) As of December 31 of each year. (2) Average base rent per square foot is based on GLA occupied as of December 31 of each year.
Base Rent Scheduled Lease Lease b) Significant Tenants Square Feet Per Annum Expiration Date Renewal Option(s) ------------------- ----------- --------- --------------- ------------------ Fry's Electronics 77,028 $231,084 7/2005 7/2010 (Retail) 7/2015
c) The following table sets forth certain information with respect to the expiration of leases for the next ten years at the Fountain Valley Industrial Park: Annualized Percent of Number of Approx. Total Base Rent Total 1993 Year Ending Expiring GLA of Expiring of Expiring Base Rent December 31, Leases Leases (1) Leases Expiring ------------ --------- --------------- ----------- ---------- 1994 1 12,702 $ 68,600 4% 1995 3 81,516 464,200 26% 1996 3 52,080 298,100 17% 1997 5 90,670 434,100 24% 1998 1 20,000 -- - (2) 1999 - -- -- - 2000 - -- -- - 2001 - - -- - 2002 - - -- - 2003 - - -- - 2004 - - -- - (1) Excludes leases that expire in 1994 for which renewal leases or leases with replacement tenants have been executed as of March 25, 1994. (2) Due to rental concessions in 1993, the tenant paid no base rent in 1993.
Property - -------- Rivertree Court Shopping Center a) The GLA historical occupancy rate and average base rent per square foot for the last five years were as follows: Year Ending GLA Avg. Base Rent Per December 31, Occupancy Rate (1) Square Foot (2) ------------ ----------------- ------------------ 1989 . . . . . 90% $11.66 1990 . . . . . 91% 11.30 1991 . . . . . 83% 12.97 1992 . . . . . 90% 11.28 1993 . . . . . 97% 11.52 (1) As of December 31 of each year. (2) Average base rent per square foot is based on GLA occupied as of December 31 of each year.
Base Rent Scheduled Lease Lease b) Significant Tenants Square Feet Per Annum Expiration Date Renewal Option(s) ------------------- ----------- --------- --------------- ------------------ Phar-Mor Inc. (2) 40,560 $294,100 3/2003 $8.25 psf through 3/2008 (Drug Store) $8.75 psf through 3/2013 $9.25 psf through 3/2018 Cineplex Odeon 40,000 720,000 2/2008 $24.00 psf through 2/2013 (Cinema) $26.00 psf through 2/2018
c) The following table sets forth certain information with respect to the expiration of leases for the next ten years at the Rivertree Court Shopping Center: Annualized Percent of Number of Approx. Total Base Rent Total 1993 Year Ending Expiring GLA of Expiring of Expiring Base Rent December 31, Leases Leases (1) Leases Expiring ------------ --------- --------------- ----------- ---------- 1994 7 18,946 $309,100 9% 1995 6 8,402 157,100 5% 1996 8 20,127 303,900 9% 1997 2 3,331 52,100 1% 1998 8 58,104 586,400 18% 1999 4 10,819 159,500 5% 2000 1 4,942 -- - (3) 2001 1 15,140 126,400 4% 2002 2 7,024 93,000 3% 2003 1 40,560 294,100 9% 2004 1 25,031 244,100 7% (1) Excludes leases that expire in 1994 for which renewal leases or leases with replacement tenants have been executed as of March 25, 1994. (2) During the third quarter of 1992, Phar-Mor filed for protection under Chapter XI of the United States Bankruptcy Code. The Phar-Mor store at the Rivertree Court Shopping Center continues to operate and pay rent pursuant to its lease obligation. (3) Due to rental concessions in 1993, the tenant paid no base rent in 1993.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS LIQUIDITY AND CAPITAL RESOURCES On August 20, 1986, the Partnership commenced an offering to the public of $100,000,000, subject to increase by up to $250,000,000, of Interests pursuant to a Registration Statement on Form S-11 under the Securities Act of 1933. On April 14, 1987, the offering was consummated and a total of 126,409 Interests were issued to the public by the Partnership from which the Partnership received gross proceeds of $126,409,000. After deducting selling expenses and other offering costs, the Partnership had approximately $113,741,000 with which to make investments primarily in existing commercial real property, to pay legal fees and other costs (including acquisition fees) related to such investments and to satisfy working capital requirements. A portion of such proceeds was utilized to acquire the properties described in Item 1 above. At December 31, 1993, the Partnership and its consolidated venture had cash and cash equivalents of approximately $1,300,000. Such funds and short- term investments of approximately $11,520,000 are available for future distri- butions to partners, working capital requirements, anticipated releasing costs at the Rivertree Court Shopping Center and to make additional investments in the venture which owns the First Financial Plaza Office Building as described in Note 3. As more fully described in Note 5, distributions to the General Partners have been deferred in accordance with the subordination requirements of the Partnership Agreement. The Partnership and its consolidated venture have currently budgeted in 1994 approximately $689,000 for tenant improvements and other capital expenditures. The Partnership's share of such items and its share of similar items for its unconsolidated ventures in 1994 is currently budgeted to be approximately $950,000. Actual amounts expended in 1994 may vary depending on a number of factors including actual leasing activity, results of property operations, liquidity considerations and other market conditions over the course of the year. The source of capital for such items and for both short-term and long-term future liquidity and distributions is expected to be through cash generated by the Partnership's investment properties and through the sale of such investments. The Partnership's and its ventures' mortgage obligations are all non-recourse. Therefore, the Partnership and its ventures are not obligated to pay mortgage indebtedness unless the related property produces sufficient net cash flow from operations or sale. In 1992, the Partnership paid approximately $345,000 relating to significant seismic-related improvements made to certain buildings at the Fountain Valley and Cerritos Industrial Parks in 1991. In 1993, the Partnership paid approximately $305,000 to complete significant land and building improvements at the Cerritos Industrial Park originally budgeted in 1992 as a result of a mandate from the City of Cerritos. In 1995 and 1996, leases at the Cerritos Industrial Park representing 33% and 22%, respectively, of the leasable square footage are scheduled to expire, not all of which are expected to be renewed. The Fountain Valley Industrial Park currently operates in a market with industrial vacancy rates ranging from 15% to 16%. Fountain Valley is currently 85% leased and occupied. The Partnership and the Newport Corporation, which vacated in March 1992 prior to its 1995 lease expiration and continues to pay rent pursuant to its one remaining lease obligation, entered into an agreement to terminate one of Newport's leases for approximately 77,000 square feet (representing approximately 20% of the leasable square footage at the property) in July 1993 for a $487,000 fee paid to the Partnership. The space has been leased to Fry's Electronics, an electronics retailer, for a twelve-year term effective July 1993. International Tile vacated its approximate 36,000 square feet in August 1993 prior to its lease expiration in 1997. In January 1994, International Tile filed for protection under Chapter XI of the United States Bankruptcy Code. It is unlikely that the Partnership will collect the approximate $90,000 owed by International Tile at December 31, 1993. In 1995 and 1996, leases representing 21% and 13%, respectively, of the leasable square footage at Fountain Valley are scheduled to expire, not all of which are expected to be renewed. Currently, as leases at the Fountain Valley and Cerritos Industrial Parks expire, lease renewals and new leases will likely be at rental rates less than the rates on existing leases. The supply of industrial space has caused increased competition for tenants, a corresponding decline in rental rates and a corresponding increase in time required to re-lease tenant space in these markets. This anticipated decline in rental rates and anticipated increase in re-leasing time will result in a decrease in cash flow from operations over the near term. Fountain Valley incurred minimal damage and Cerritos incurred no damage as a result of the earthquake in southern California on January 17, 1994. In February 1994, the Partnership extended and increased the first mortgage loan in the principal amount to $11,200,000, which is secured by the Fountain Valley and Cerritos Industrial Parks. The extended loan bears interest at a rate of 7.32% per annum, provides for monthly payments of principal and interest based on a twenty-year amortization period and matures March 1, 2001. After payment of costs and fees related to the re-financing, there were no distributable proceeds from the loan extension. Prior to the extension, the Partnership had entered into a forbearance agreement with the lender providing, among other things, that the lender agreed not to exercise its rights and remedies under the original loan documents from November 2, 1993, the original maturity date, until January 31, 1994. The Partnership continued to pay interest only at an annual rate of 8.83% on the original $11,000,000 principal balance through the effective date of the refinancing. As of December 31, 1993, the Partnership has made an aggregate investment of approximately $24,994,000 relating to a maximum total commitment of $25,750,000 to an existing partnership (Adams/Wabash) that constructed a parking garage and retail space structure known as the Adams/Wabash Self Park as described in Note 3(e). The Partnership is not required to increase this original aggregate investment. Pursuant to the Adams/Wabash Partnership Agreement, the Partnership's interest in the venture increased from 49.9% to 74.9% effective October 1, 1993. The Rivertree Court Shopping Center operates in a market which is experiencing significant growth in the commercial and residential sectors. The growth in the area is expected to continue in the next several years. However, in January 1994, Filene's Basement vacated their space of approximately 26,000 square feet (representing approximately 9% of the leasable square footage at the property) but continues to pay rent pursuant to its lease. The Partnership is finalizing its approval of a sub-tenant for the Filene's store. During the third quarter of 1992, Highland Superstores, Inc. and Phar-Mor, both of which then had stores at the Rivertree Court Shopping Center, filed for protection under Chapter XI of the United States Bankruptcy Code. Highland vacated its space at the end of August 1992. The Partnership has leased the Highland space to Best Buy, an appliance and home electronics retailer, which opened during February 1993. The Phar-Mor store at the center continues to operate and pay rent under its lease obligation since its bankruptcy filing. The Partnership has received no notification of Phar-Mor's intentions regarding the continued operations of this store. However, the Partnership has finalized negotiations with a replacement tenant should Phar- Mor vacate its space in the near future. On January 30, 1992, the Partnership, through JMB/Mid Rivers Mall Associates, sold its interest in the Mid Rivers Mall located in St. Peters, Missouri to the unaffiliated joint venture partner. The Partnership received in connection with the sale, after all fees, expenses and joint venture partner's participation, a net amount of cash of $13,250,000. See Note 7 for a further description of this transaction. The West Dade joint venture which owns the Miami International Mall entered into an agreement with J.C. Penney which opened a department store at the mall in October 1992 (see Note 3(d)). The addition of J.C. Penney has had a positive impact on the operations of the mall. During the third quarter of 1992, the property experienced storm damage caused by Hurricane Andrew. It has been determined that structural damage to the building was minimal; however, the landscaping surrounding the building, including the irrigation system and street curbs, was impacted more severely. All repairs necessary to continue operations have been made. The Partnership believes West Dade has adequate insurance coverage for this damage. A claim has been submitted to the property's insurance company for approximately $750,000. In January 1994, a partial settlement of approximately $710,000 of the expected insurance proceeds had been received. West Dade sold a 3.9 acre outparcel of land at the Miami International Mall in June 1993 for a net sale price of approximately $1,560,000, after certain selling costs, of which the Partnership's share was approximately $390,000. For financial reporting purposes, West Dade has recognized a gain in 1993 of approximately $1,385,000, of which the Partnership's share is approximately $346,000. West Dade is currently negotiating the sale of an additional 4 acre outparcel of land. In December 1993, West Dade obtained a new mortgage loan in the principal amount of $47,500,000 replacing the existing first mortgage loan at the property. The new mortgage loan bears interest at 6.91% per annum and matures December 21, 2003. The loan provides for monthly interest-only payments for years one through three and monthly principal and interest payments based on a twenty-year amortization period for years four through ten. The non-recourse loan is secured by a first mortgage on the Miami International Mall. After payment of costs and fees related to the refinancing, there were no distributable proceeds from the new loan. At December 31, 1993, the First Financial Plaza office building is approximately 85% occupied. In July 1993, Mitsubishi vacated its approximate 8,100 square feet prior to its lease expiration of January 1997 and continues to pay rent pursuant to its lease obligation. Including the Misubishi lease and recently executed leases, the building is 91% leased. In 1994, leases representing approximately 20% of the leasable square footage are scheduled to expire. Although renewal discussions with the majority of these tenants have been favorable, there can be no assurance that all of these tenants will renew their leases upon expiration. The Los Angeles office market in general and the Encino submarket in particular have become extremely competitive resulting in higher rental concession granted to tenants and flat or decreasing market rental rates. Furthermore, due to the recession in southern California and to concerns regarding tenants' ability to perform under current lease terms, the venture has granted rent deferrals and other forms of rent relief to several tenants including First Financial Housing, an affiliate of the unaffiliated venture partner. The property incurred minimal damage as a result of the earthquake in southern California on January 17, 1994. There are certain risks associated with the Partnership's investments made through joint ventures including the possibility that the Partnership's joint venture partners in an investment might become unable or unwilling to fulfill their financial or other obligations, or that such joint venture partners may have economic or business interest or goals that are inconsistent with those of the Partnership. In response to the weakness of the economy and the limited amount of available real estate financing in particular, the Partnership is taking steps to preserve its working capital. Therefore, the Partnership is carefully scrutinizing the appropriateness of any discretionary expenditures, particularly in relation to the amount of working capital it has available. By conserving working capital, the Partnership will be in a better position to meet future needs of its properties without having to rely on external financing sources. RESULTS OF OPERATIONS The increase in interest, rents, and other receivables as of December 31, 1993 as compared to December 31, 1992 is primarily due to the timing of the collection of tenant escalations at the Rivertree Court Shopping Center. The increase in deferred expenses as of December 31, 1993 as compared to December 31, 1992 and the related amortization expense for the year ended December 31, 1993 as compared to the year ended December 31, 1992 is primarily due to the capitalization and amortization of the lease commissions related to the 1993 commencement of the Fry's Electronics lease at the Fountain Valley Industrial Park. The decrease in amortization expense for the year ended December 31, 1992 as compared to the year ended December 31, 1991 is primarily due to the write off of deferred lease costs relating to a tenant vacating its space at the Fountain Valley Industrial Park in 1991. The decrease in current portion of long-term debt and the corresponding increase in long-term debt at December 31, 1993 as compared to December 31, 1992 is due to the extension of the $11,000,000 first mortgage loan secured by the Fountain Valley and Cerritos Industrial Parks subsequent to December 31, 1993 (see Note 4(b)). The increase in rental income for the year ended December 31, 1993 as compared to the year ended December 31, 1992 is primarily due to higher average occupancy levels at the Adams/Wabash Self Park, the Rivertree Court Shopping Center, and the Fountain Valley and Cerritos Industrial Parks. The increase in rental income is also due to the $487,000 termination fee received for the termination of one of the Newport Corporation lease obligations at the Fountain Valley Industrial Park in July 1993. In addition, parking revenue at the Adams/Wabash Self Park increased due to two monthly parking contracts which were executed during October 1992 and to increased activity from the Palmer House Hotel parking contract. The increase in leasing at the above- mentioned properties has also resulted in an increase in accrued rents receivable at December 31, 1993 as compared to December 31, 1992. The increase in rental income for the year ended December 31, 1992 as compared to the year ended December 31, 1991 is primarily due to an increase in parking revenue at the Adams/Wabash investment property due to two monthly parking contracts which were executed during October 1992 and to increased activity from the Palmer House Hotel parking contract. In addition, rental income from the retail space at the Adams/Wabash investment property increased due to higher average occupancy levels during 1992 as compared to 1991. Fountain Valley Industrial Park also received a partial bankruptcy settlement of $80,000 in 1992. The decrease in interest income for the year ended December 31, 1993 as compared to the year ended December 31, 1992 and the increase in interest income for the year ended December 31, 1992 as compared to the year ended December 31, 1991 are primarily due to the Partnership maintaining a higher average invested balance in U.S. Government obligations during 1992. The higher average invested balance resulted primarily from the receipt of cash proceeds (a portion of which were subsequently distributed to the Limited Partners in 1992) from the sale of the Partnership's interest in the Mid Rivers Mall in January 1992. The decrease in the amount of loss from Partnership's share of operations of unconsolidated ventures for the year ended December 31, 1993 as compared to the year ended December 31, 1992 is due primarily to increased operations at the Miami International Mall. The decrease in the amount of loss from Partnership's share of operations of unconsolidated ventures for the year ended December 31, 1992 as compared to the year ended December 31, 1991 is primarily due to the sale of the Partnership's interest in the Mid Rivers Mall. The decrease in Partnership's share of gain on sale of investment property and gain on sale of land from unconsolidated venture for the year ended December 31, 1993 as compared to the year ended December 31, 1992 and the increase for the year ended December 31, 1992 as compared to the year ended December 31, 1991 are primarily due to the gain recognized in connection with the sale of the Partnership's interest in the Mid Rivers Mall in January 1992, partially offset by the sale of a 3.9 acre outparcel of land at the Miami International Mall in June 1993 (see Note 3(d)). The decrease in extraordinary item from unconsolidated venture for the year ended December 31, 1993 as compared to the year ended December 31, 1992 is primarily due to a prepayment penalty to the first mortgage lender as a result of the loan refinancing at the Miami International Mall in December 1993 (see Note 3(d)). INFLATION Due to the decrease in the level of inflation in recent years, inflation generally has not had a material effect on rental income or property operating expenses. To the extent that inflation in future periods does have an adverse impact on property operating expenses, the effect will generally be offset by amounts recovered from tenants as many of the long-term leases at the Partnership's commercial properties have escalation clauses covering increases in the cost of operating and maintaining the properties as well as real estate taxes. Therefore, there should be little effect on operating earnings if the properties remain substantially occupied. In addition, substantially all of the leases at the Partnership's shopping center investment property contain provisions which entitle the Partnership to participate in gross receipts of tenants above fixed minimum amounts. Future inflation may also cause capital appreciation of the Partnership's investment properties over a period of time to the extent that rental rates and replacement costs of properties increase. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE INDEX Independent Auditors' Report Consolidated Balance Sheets, December 31, 1993 and 1992 Consolidated Statements of Operations, years ended December 31, 1993, 1992 and 1991 Consolidated Statements of Partners' Capital Accounts (Deficits), years ended December 31, 1993, 1992 and 1991 Consolidated Statements of Cash Flows, years ended December 31, 1993, 1992 and 1991 Notes to Consolidated Financial Statements SCHEDULE -------- Supplementary Income Statement Information X Consolidated Real Estate and Accumulated Depreciation XI SCHEDULES NOT FILED: All schedules other than those indicated in the index have been omitted as the required information is inapplicable or the information is presented in the consolidated financial statements or related notes. INDEPENDENT AUDITORS' REPORT The Partners JMB INCOME PROPERTIES, LTD. - XIII: We have audited the consolidated financial statements of JMB Income Properties, Ltd. - XIII (a limited partnership) and consolidated venture as listed in the accompanying index. In connection with our audits of the consolidated financial statements, we also have audited the financial statement schedules as listed in the accompanying index. These consolidated financial statements and financial statement schedules are the responsibility of the General Partners of the Partnership. Our responsibility is to express an opinion on these consolidated financial statements and financial statement schedules based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the General Partners of the Partnership, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of JMB Income Properties, Ltd. - XIII and consolidated venture at December 31, 1993 and 1992, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 1993, in conformity with generally accepted accounting principles. Also in our opinion, the related financial statement schedules, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein. KPMG PEAT MARWICK Chicago, Illinois March 22, 1994 JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE CONSOLIDATED BALANCE SHEETS DECEMBER 31, 1993 AND 1992 ASSETS ------
1993 1992 ------------ ----------- Current assets: Cash and cash equivalents (note 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,301,466 3,428,494 Short-term investments (note 1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,520,463 9,697,729 Interest, rents and other receivables. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,039,884 716,021 Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67,608 62,411 ------------ ----------- Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,929,421 13,904,655 Investment properties, at cost (notes 2, 4 and 8) - Schedule XI: Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,566,702 23,566,702 Buildings and improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74,953,712 74,228,340 ------------ ----------- 98,520,414 97,795,042 Less: accumulated depreciation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (11,626,188) (9,149,275) ------------ ----------- Total investment properties, net of accumulated depreciation. . . . . . . . . . . . . . . . . 86,894,226 88,645,767 Investments in unconsolidated ventures, at equity (notes 3 and 10) . . . . . . . . . . . . . . . . . . 10,779,381 11,840,422 Deferred expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 805,423 585,219 Accrued rents receivable (note 1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,173,482 983,441 ------------ ----------- $113,581,933 115,959,504 ============ =========== JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE CONSOLIDATED BALANCE SHEETS - CONTINUED LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS (DEFICITS) ---------------------------------------------------- 1993 1992 ------------ ----------- Current liabilities: Current portion of long-term debt (note 4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ -- 11,000,000 Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215,713 179,953 Accrued interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 212,168 212,168 Accrued real estate taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,155,752 1,108,953 ------------ ----------- Total current liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,583,633 12,501,074 Tenant security deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 310,468 367,771 Long-term debt (note 4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,700,000 15,700,000 ------------ ----------- Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,594,101 28,568,845 ------------ ----------- Partners' capital accounts (deficits) (notes 1 and 5): General partners: Capital contributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000 20,000 Cumulative net earnings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 600,395 496,914 Cumulative cash distributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,088,351) (946,472) ------------ ----------- (467,956) (429,558) ------------ ----------- Limited partners (126,414 interests): Capital contributions, net of offering costs . . . . . . . . . . . . . . . . . . . . . . . . . 113,741,315 113,741,315 Cumulative net earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,444,026 16,700,819 Cumulative cash distributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (47,729,553) (42,621,917) ------------ ----------- 85,455,788 87,820,217 ------------ ----------- Total partners' capital accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84,987,832 87,390,659 ------------ ----------- Commitments and contingencies (notes 3, 4 and 8) $113,581,933 115,959,504 ============ =========== See accompanying notes to consolidated financial statements.
JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE CONSOLIDATED STATEMENTS OF OPERATIONS YEARS ENDED DECEMBER 31, 1993, 1992 AND 1991
1993 1992 1991 ----------- ----------- ----------- Income: Rental income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $11,897,992 10,490,689 9,689,131 Interest income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 394,010 649,787 445,828 ----------- ----------- ----------- 12,292,002 11,140,476 10,134,959 ----------- ----------- ----------- Expenses: Mortgage and other interest. . . . . . . . . . . . . . . . . . . . . . . . . . 2,546,010 2,546,010 2,546,010 Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,476,913 2,454,001 2,415,414 Property operating expenses. . . . . . . . . . . . . . . . . . . . . . . . . . 3,529,702 3,263,607 3,497,218 Professional services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 192,239 268,480 206,812 Amortization of deferred expenses. . . . . . . . . . . . . . . . . . . . . . . 175,953 150,274 259,006 General and administrative . . . . . . . . . . . . . . . . . . . . . . . . . . 191,675 251,310 374,125 ----------- ----------- ----------- 9,112,492 8,933,682 9,298,585 ----------- ----------- ----------- Operating earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,179,510 2,206,794 836,374 Partnership's share of operations of unconsolidated ventures (note 3). . . . . . (157,847) (251,748) (469,751) ----------- ----------- ----------- Net operating earnings . . . . . . . . . . . . . . . . . . . . . . . . . 3,021,663 1,955,046 366,623 Partnership's share of gain on sale of investment property and gain on sale of land from unconsolidated venture (notes 3(d) and 7) . . . . . . . . 346,208 6,366,463 -- ----------- ----------- ----------- Net earnings before Partnership's share of extraordinary item from unconsolidated venture . . . . . . . . . . . . . . . . . . . . . . . . $ 3,367,871 8,321,509 366,623 Partnership's share of extraordinary item from unconsolidated venture (note 3(d)) (521,183) -- -- ----------- ----------- ----------- Net earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,846,688 8,321,509 366,623 =========== =========== =========== Net earnings per limited partnership interest (note 1): Net operating earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 22.95 14.85 2.78 Partnership's share of gain on sale of investment property and gain on sale of land from unconsolidated venture . . . . . . . . . . . . . . . . . . . . . . 2.71 49.86 -- Partnership's share of extraordinary item from unconsolidated venture. . . . . (3.96) -- -- ----------- ----------- ----------- Net earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 21.70 64.71 2.78 =========== =========== =========== See accompanying notes to consolidated financial statements.
JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL ACCOUNTS (DEFICITS) YEARS ENDED DECEMBER 31, 1993, 1992 AND 1991
GENERAL PARTNERS LIMITED PARTNERS (126,414 INTEREST) ------------------------------------------------------- -------------------------------------------------- CONTRI- BUTIONS NET OF CONTRI- NET CASH OFFERING NET CASH BUTIONS EARNINGS DISTRIBUTIONS TOTAL COSTS EARNINGS DISTRIBUTIONS TOTAL -------- ---------- ------------- -------- ----------- ---------- ------------- ----------- Balance (deficit) at December 31, 1990 .$20,000 340,383 (650,300) (289,917) 113,741,315 8,169,218 (26,213,635) 95,696,898 Net earnings . . . . -- 14,665 -- 14,665 -- 351,958 -- 351,958 Cash distributions ($43.50 per Interest) . . . . . -- -- (154,293) (154,293) -- -- (5,554,555) (5,554,555) -------- -------- ---------- -------- ----------- ---------- ----------- ----------- Balance (deficit) at December 31, 1991 . 20,000 355,048 (804,593) (429,545) 113,741,315 8,521,176 (31,768,190) 90,494,301 Net earnings . . . . -- 141,866 -- 141,866 -- 8,179,643 -- 8,179,643 Cash distributions ($85.00 per Interest) . . . . . -- -- (141,879) (141,879) -- -- (10,853,727) (10,853,727) -------- -------- ---------- -------- ----------- ---------- ----------- ----------- Balance (deficit) at December 31, 1992 . 20,000 496,914 (946,472) (429,558) 113,741,315 16,700,819 (42,621,917) 87,820,217 Net earnings . . . . -- 103,481 -- 103,481 -- 2,743,207 -- 2,743,207 Cash distributions ($40.00 per Interest) . . . . . -- -- (141,879) (141,879) -- -- (5,107,636) (5,107,636) -------- -------- ---------- -------- ----------- ---------- ----------- ----------- Balance (deficit) at December 31, 1993 .$20,000 600,395 (1,088,351) (467,956) 113,741,315 19,444,026 (47,729,553) 85,455,788 ======== ======== ========== ======== =========== ========== =========== =========== See accompanying notes to consolidated financial statements.
JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 1993, 1992 AND 1991
1993 1992 1991 ----------- ----------- ----------- Cash flows from operating activities: Net earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,846,688 8,321,509 366,623 Items not requiring (providing) cash or cash equivalents: Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,476,913 2,454,001 2,415,414 Amortization of deferred expenses. . . . . . . . . . . . . . . . . . . . . . 175,953 150,274 259,006 Partnership's share of operations of unconsolidated ventures . . . . . . . . 157,847 251,748 469,751 Partnership's share of gain on sale of investment property and gain on sale of land from unconsolidated venture. . . . . . . . . . . . . . . . (346,208) (6,366,463) -- Partnership's share of extraordinary item from unconsolidated venture. . . . 521,183 -- -- Changes in: Interest, rents and other receivables. . . . . . . . . . . . . . . . . . . . (323,863) 222,377 116,450 Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,197) 8,135 (12,630) Accrued rents receivable . . . . . . . . . . . . . . . . . . . . . . . . . . (190,041) (134,248) (263,027) Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,760 (105,657) (116,445) Accrued real estate taxes. . . . . . . . . . . . . . . . . . . . . . . . . . 46,799 (74,663) 580,972 Tenant security deposits . . . . . . . . . . . . . . . . . . . . . . . . . . (57,303) 34,480 (27,659) ----------- ----------- ----------- Net cash provided by operating activities. . . . . . . . . . . . . . . . 5,338,531 4,761,493 3,788,455 ----------- ----------- ----------- Cash flows from investing activities: Net (purchases) sales of short-term investments. . . . . . . . . . . . . . . . (1,822,734) (4,545,928) 2,660,649 Additions to investment properties (net of related payables) . . . . . . . . . (725,372) (961,888) (1,709,239) Partnership's distributions from unconsolidated ventures and proceeds from sale of investment property . . . . . . . . . . . . . . . . . . . . . . . . . . . 782,450 14,101,640 2,990,811 Partnership's contributions to unconsolidated ventures . . . . . . . . . . . . (54,231) (218,357) (1,083,253) Payment of deferred expenses . . . . . . . . . . . . . . . . . . . . . . . . . (396,157) (229,024) (272,073) ----------- ----------- ----------- Net cash provided by (used in) investing activities. . . . . . . . . . . (2,216,044) 8,146,443 2,586,895 ----------- ----------- ----------- JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED 1993 1992 1991 ----------- ----------- ----------- Cash flows from financing activities: Distributions to limited partners. . . . . . . . . . . . . . . . . . . . . . . (5,107,636) (10,853,727) (5,554,555) Distributions to general partners. . . . . . . . . . . . . . . . . . . . . . . (141,879) (141,879) (154,293) ----------- ----------- ----------- Net cash used in financing activities. . . . . . . . . . . . . . . . . . (5,249,515) (10,995,606) (5,708,848) ----------- ----------- ----------- Net increase (decrease) in cash and cash equivalents . . . . . . . . . . $(2,127,028) 1,912,330 666,502 =========== =========== =========== Supplemental disclosure of cash flow information: Cash paid for mortgage and other interest. . . . . . . . . . . . . . . . . . . $ 2,546,010 2,546,010 2,546,010 =========== =========== =========== Non-cash investing and financing activities. . . . . . . . . . . . . . . . . . $ -- -- -- =========== =========== =========== See accompanying notes to consolidated financial statements.
JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1993, 1992 AND 1991 (1) BASIS OF ACCOUNTING The accompanying consolidated financial statements include the accounts of the Partnership and one of its ventures, Adams/Wabash Limited Partnership ("Adams/Wabash"). The effect of all transactions between the Partnership and Adams/Wabash have been eliminated in the consolidated financial statements. The equity method of accounting has been applied in the accompanying financial statements with respect to the Partnership's interests in JMB/Mid Rivers Associates ("JMB/Rivers") (see note 7), JMB First Financial Associates ("First Financial") and JMB/Miami International Associates ("JMB/Miami"). Accordingly, the accompanying financial statements do not include the accounts of JMB/Rivers, First Financial and JMB/Miami. The Partnership's records are maintained on the accrual basis of accounting as adjusted for Federal income tax reporting purposes. The accompanying financial statements have been prepared from such records after making appropriate adjustments where applicable to reflect the Partnership's accounts in accordance with generally accepted accounting principles ("GAAP"). Such adjustments are not recorded on the records of the Partnership. The net effect of these items is summarized as follows for the years ended December 31, 1993 and 1992: JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
1993 1992 ------------------------------ ------------------------------ GAAP BASIS TAX BASIS GAAP BASIS TAX BASIS ------------ ----------- ------------ ----------- Total assets . . . . . . . . . . . . . . . . . . . . . . . $113,581,933 123,643,503 115,959,504 126,904,215 Partners' capital accounts (deficits) (note 5): General partners . . . . . . . . . . . . . . . . . . . . (467,956) (891,359) (429,558) (829,950) Limited partners . . . . . . . . . . . . . . . . . . . . 85,455,788 96,127,046 87,820,217 99,331,009 Net earnings (note 5): General partners . . . . . . . . . . . . . . . . . . . . 103,481 80,469 141,866 103,644 Limited partners . . . . . . . . . . . . . . . . . . . . 2,743,207 1,903,674 8,179,643 8,442,733 Net earnings per Interest. . . . . . . . . . . . . . . . . 21.70 15.06 64.71 66.79 =========== =========== =========== ============
JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED The net earnings (loss) per limited partnership interest is based upon the limited partnership interests outstanding at the end of the period (126,414). Deficit capital accounts will result, through the duration of the Partnership, in net gain for financial reporting and income tax purposes. Statement of Financial Accounting Standards No. 95 requires the Partnership to present a statement which classifies receipts and payments according to whether they stem from operating, investing or financing activities. The required information has been segregated and accumulated according to the classifications specified in the pronouncement. Partnership distributions from its unconsolidated ventures are considered cash flow from operating activities only to the extent of the Partnership's cumulative share of net earnings. The Partnership records amounts held in U.S. Government obligations at cost, which approximates market. For the purposes of these statements, the Partnership's policy is to consider all such amounts held with original maturities of three months or less ($0 and $1,985,253 at December 31, 1993 and 1992, respectively) as cash equivalents with any remaining amounts reflected as short-term investments. Deferred expenses consist primarily of deferred organization costs which are amortized over a 60-month period and deferred lease commissions and loan fees which are amortized over their respective terms using the straight-line method. Although certain leases of the Partnership provide for tenant occupancy during periods for which no rent is due and/or increases in minimum lease payments over the term of the lease, the Partnership accrues rental income for the full period of occupancy on a straight-line basis. No provision for State or Federal income taxes has been made as the liability for such taxes is that of the Partners rather than the Partnership. However, in certain instances, the Partnership has been required under applicable law to remit directly to the tax authorities amounts representing withholding from distributions paid to Partners. (2) INVESTMENT PROPERTIES The Partnership has acquired, either directly or through joint ventures (note 3), three shopping centers, two multi-tenant industrial buildings, an office complex and a parking/retail structure. In January 1992, the Partnership's interest in the Mid Rivers Mall was sold (note 7). All of the properties owned at December 31, 1993 were operating. The cost of the investment properties represents the total cost to the Partnership plus miscellaneous acquisition costs. Depreciation on the properties has been provided over the estimated useful lives of the various components as follows: YEARS ----- Building and improvements -- straight-line . 30 Personal property -- straight-line . . . . . 5 == JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED Maintenance and repairs are charged to operations as incurred. Significant betterments and improvements are capitalized and depreciated over their estimated useful lives. Certain investment properties are pledged as security for the long-term debt, for which there is no recourse to the Partnership (note 4). (3) VENTURE AGREEMENTS (a) General The Partnership at December 31, 1993 is a party to three operating joint venture agreements. In addition, the Partnership through a joint venture (JMB/Rivers) sold its interest in the Mid Rivers Mall on January 30, 1992 (note 7). Pursuant to such agreements, the Partnership has made capital contributions of approximately $56,757,000 through December 31, 1993. In general, the joint venture partners, who are either the sellers (or their affiliates) of the property investments being acquired, or parties which have contributed an interest in the property being developed, or were subsequently admitted to the ventures, make no cash contributions to the ventures, but their retention of an interest in the property, through the joint venture, is taken into account in determining the purchase price of the Partnership's interest, which is determined by arm's-length negotiations. Under certain circumstances, either pursuant to the venture agreements or due to the Partnership's obligations as general partner, the Partnership may be required to make additional cash contributions to the ventures. The Partnership has acquired, through the above ventures, one office building, two regional shopping malls and one parking/retail structure. The joint venture partners (who were primarily responsible for constructing the properties) contributed any excess of cost over the aggregate amount available from Partnership contributions and financing and, to the extent such funds exceeded the aggregate costs, were to retain such excesses. Two of the venture properties operating as of December 31, 1993 have been financed under various long-term debt arrangements as described in notes (c) and (d) below. There are certain risks associated with the Partnership's investments made through joint ventures including the possibility that the Partnership's joint venture partners in an investment might become unable or unwilling to fulfill their financial or other obligations, or that such joint venture partners may have economic or business interests or goals that are inconsistent with those of the Partnership. (b) JMB/Rivers In December 1986, the Partnership and JMB Income Properties, Ltd. - XII, (a partnership sponsored by an affiliate of the Managing General Partner) ("JMB-XII"), formed JMB/Rivers, which entered into a joint venture ("Mid Rivers") with an affiliate of the developer ("Venture Partner") and acquired an interest in an enclosed regional shopping center then under construction in St. Peters, Missouri, known as Mid Rivers Mall. Under the terms of the venture agreement, JMB/Rivers contributed approximately $39,400,000, of which the Partnership's share was approximately $19,700,000. During January 1992, JMB/Rivers sold its interest in Mid Rivers Mall (see note 7). JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED The ultimate ownership percentages for JMB/Rivers and Venture Partner were established as 80% and 20%, respectively. Operating profits and losses were generally allocated in proportion to and to the extent of distributions as described above and, to the extent profits and losses exceeded such distributions, to the Partners in accordance with their respective ownership percentages. The terms of the JMB/Rivers agreement generally provided that the Partnership was allocated or distributed, as the case may be, profits and losses, cash flow from operations and sale or refinancing proceeds in the ratio of its respective capital contributions to JMB/Rivers. The shopping center was managed by an affiliate of the Venture Partner for a fee calculated as 4% of gross receipts of the property through the date of the sale. (c) First Financial On May 20, 1987, the Partnership, through First Financial, a joint venture with JMB-XII, acquired an interest in a general partnership ("Encino") with an affiliate of the developer ("Venture Partner") which owns an office building in Encino (Los Angeles), California. First Financial is obligated to make an initial investment in the aggregate amount of $49,850,000 of which approximately $49,812,000 of such contributions have been made to Encino. The Partnership's share of the remaining amounts, approximately $14,000, will be contributed when the venture partner complies with certain requirements. In November 1987, First Financial caused Encino to obtain a third party first mortgage loan in the amount of $30,000,000. The proceeds of such loan were distributed to First Financial to reduce its contribution and to the Venture Partner who subsequently repaid a $15,500,000 loan from First Financial. Thus, the total cash investment of First Financial for its interest in the office building, after consideration of the funding of the $30,000,000 permanent financing, is approximately $20,000,000, of which the Partnership's share is approximately $7,500,000. The outstanding principal balance of the third party first mortgage loan as of December 31, 1993 is $29,394,848. The Encino partnership agreement generally provides that First Financial is entitled to receive (after any participating amounts due to Pepperdine University pursuant to its tenant lease) from cash flow from operations (as defined) an annual cumulative preferred return equal to 9.05% through April 30, 1995 (and 8.9% thereafter) of its capital contributions. Any remaining cash flow is to be split equally between First Financial and the Venture Partner. Pepperdine University, under its tenant lease, is entitled to an amount based on 6.6% of the Venture Partner's share of the office building's net operating profit and net sale profit (as defined). All of Encino's operating profits and losses before depreciation have been allocated to First Financial in 1993, 1992 and 1991. The Encino partnership agreement also generally provides that net sale proceeds and net refinancing proceeds (as defined), after any amounts due to Pepperdine University pursuant to its tenant lease, are to be distributed: first, to First Financial in an amount equal to the deficiency, if any, in its cumulative preferred return as described above; next, to First Financial in the amount of its capital contributions; next, to the Venture Partner in an amount equal to $600,000; any remaining proceeds are to be split equally between First Financial and the Venture Partner. JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED The terms of the First Financial partnership agreement provide that annual cash flow, net sale or refinancing proceeds, and tax items will be distributed or allocated, as the case may be, to the Partnership in proportion to its 37.5% share of capital contributions. The office building is managed by an affiliate of the Venture Partner for a fee based upon a percentage of rental receipts (as defined) of the property. (d) JMB/Miami On January 26, 1988, the Partnership, through JMB/Miami, a joint venture with JMB/Miami Investors L.P., a partnership sponsored by an affiliate of the General Partners of the Partnership, acquired an interest in an existing partnership ("West Dade" in which JMB/Miami is a general partner), with an affiliate of the developer (the "Venture Partner"), which owns an enclosed regional shopping center in Miami, Florida known as Miami International Mall. During February 1989, IDS/JMB Balanced Income Growth, Ltd., a partnership sponsored by an affiliate of the General Partners of the Partnership made a capital contribution to JMB/Miami to acquire an interest therein. During October 1993, JMB/Miami Investors L.P. transferred its interest in JMB/Miami to Urban Shopping Centers, L.P., a partnership controlled by Urban Shopping Centers, Inc. (a corporation organized by an affiliate of the General Partners of the Partnership, which operates in a manner which it expects to enable it to qualify as a real estate investment trust). The total cash investment of JMB/Miami in West Dade is $20,805,000, of which the Partnership's share is $10,402,500. The terms of JMB/Miami partnership agreement provide that annual cash flow, net sale or refinancing proceeds, and tax items will be distributed or allocated, as the case may be, to the Partnership in proportion to its 50% share of capital contributions. At closing, JMB/Miami made a cash payment of $14,567,306 consisting of (i) $13,441,000 for a 33% interest in West Dade and options, exercised in early 1989, to acquire an additional 17% interest in West Dade and (ii) $1,126,306 as a contribution for initial working capital requirements of West Dade. JMB/Miami paid an additional $4,237,694 of purchase price representing payments under the various option agreements entered into at closing, upon exercise of these options in February 1989. The West Dade venture agreement provides that JMB/Miami and the Venture Partner generally are each entitled to receive 50% of profits and losses, net cash flow and net sale or refinancing proceeds of West Dade and are each obligated to advance 50% of any additional funds required under the terms of the West Dade venture agreement. In December 1993, West Dade obtained a new mortgage loan in the principal amount of $47,500,000 replacing the existing first mortgage loan at the property. The new mortgage loan bears interest at 6.91% per annum and matures December 21, 2003. The loan provides for monthly interest-only payments for years one through three and monthly principal and interest payments based on a twenty-year amortization period for years four through ten. The loan permits prepayment in full with 30 days prior written notice and payment of a premium calculated as the greater of (i) 1% of the principal being prepaid multiplied by the percent of months remaining to maturity or (ii) the present value of the loan less principal and accrued interest being prepaid. The non-recourse loan is secured by a first mortgage on the Miami International Mall. After payment of costs and fees related to the refinancing, there were no distributable proceeds from the new loan. JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED In conjunction with the refinancing in December 1993, West Dade incurred a prepayment penalty on the early retirement of the original loan in the amount $2,015,357, of which the Partnership's share is $503,839. In addition, West Dade had written off costs associated with the original loan in the amount of $69,374, of which the Partnership's share is $17,344. In 1992, West Dade sold land to J.C. Penney to open a department store at the mall. Under the sale agreement, J.C. Penney purchased land from West Dade for approximately $1,260,000, and West Dade expended approximately $894,000 related to land preparation costs in 1990 and 1991. J.C. Penney completed construction of its own facility of 145,824 square feet and opened in late October 1992. During the third quarter of 1992, the property experienced storm damage caused by Hurricane Andrew. Although structural damage to the building was minimal, the landscaping surrounding the building, including the irrigation system and street curbs, was impacted more severely. All repairs necessary to continue operations have been made. The Partnership believes West Dade has adequate insurance coverage for this damage. A claim has been submitted to the property's insurance company for approximately $750,000. In January 1994, a partial settlement of approximately $710,000 of the expected insurance proceeds had been received. West Dade sold a 3.9 acre outparcel of land at Miami International Mall in June 1993 for a net sale price of approximately $1,560,000 after certain selling costs, of which the Partnership's share was approximately $390,000. For financial reporting purposes, West Dade has recognized a gain in 1993 of approximately $1,385,000, of which the Partnership's share is approximately $346,000. For income tax purposes, West Dade has recognized a gain in 1993 of approximately $325,000, of which the Partnership's share is a loss of approximately $37,000. West Dade is currently negotiating the sale of an additional 4 acre outparcel of land. The shopping center is managed by an affiliate of the Venture Partner. The manager is paid an annual fee equal to 4-1/2% of the net operating income of the shopping center. (e) Adams/Wabash On April 19, 1988, an affiliate of the Partnership entered into a forward commitment on behalf of the Partnership to make a total cash investment to a maximum of $25,750,000 in the Adams/Wabash Limited Partnership ("Adams/- Wabash"), which constructed a parking garage and retail space structure (the "Project") in Chicago, Illinois. The Project contains 671 parking spaces and approximately 28,800 square feet of rentable retail area. Through December 31, 1993, the Partnership has funded approximately $24,994,000 of its total cash commitment and does not anticipate increasing its original cash investment. Upon acquisition, the Partnership was admitted to an existing partnership with a 49.9% ownership interest, which increased to 74.9% effective October 1, 1993 pursuant to the terms of the Adams/Wabash Partnership Agreement. The Managing General Partner of the Partnership has a .1% interest with the remaining 25% held by the developers. The Partnership is entitled to a cumulative annual preferred return, payable from operating cash flow, of 10% of its capital contributions to the existing partnership. Payment of the preferred return was guaranteed by one of the joint venture partners through September 30, 1992, except to the extent the Partnership was required to make contributions under the joint venture agreement. Any distributable cash flow JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED in excess of the Partnership's preferred return will be distributed in accordance with the ownership interests of Adams/Wabash. The Partnership also has a preferred position with respect to distributions of sales and financing proceeds. Items of profit and loss are, in general, allocated in accordance with distributions of cash flow. Accordingly, for financial reporting purposes, for the years ended December 31, 1993, 1992 and 1991, the Partnership was allocated 100% of the operating profits of Adams/Wabash. As of December 31, 1993, the Partnership has received its preferred return. (4) LONG-TERM DEBT (a) Long-term debt consisted of the following at December 31, 1993 and 1992: 1993 1992 ------------ ------------ 10.03% mortgage note; secured by the Rivertree Court Shopping Center located in Vernon Hills (Chicago), Illinois; payable monthly, interest only; due January 1, 1999 . . . . $15,700,000 15,700,000 8.83% mortgage note; secured by the Fountain Valley and Cerritos Industrial Parks located in Fountain Valley and Cerritos, (Los Angeles) California, respectively; payable monthly, interest only; due November 1, 1993 (b). . 11,000,000 11,000,000 ----------- ---------- Total debt . . . . . . . . . . 26,700,000 26,700,000 Less current portion of long-term debt (b). . . . . . -- 11,000,000 ----------- ---------- Total long-term debt . . . . . $26,700,000 15,700,000 =========== ========== (b) Long-Term Debt Refinancing In February 1994, the Partnership extended and increased the first mortgage loan to the principal amount of $11,200,000, which is secured by the Fountain Valley and Cerritos Industrial Parks. The extended loan bears interest at a rate of 7.32% per annum, provides for monthly payments of principal and interest based on a twenty-year amortization period and matures March 1, 2001. After payment of costs and fees related to the refinancing, there were no distributable proceeds from the loan extension. Prior to the extension, the Partnership had entered into a forbearance agreement with the lender providing, among other things, that the lender agreed not to exercise its rights and remedies under the original loan documents from November 2, 1993, the original maturity date, until January 31, 1994. The Partnership continued to pay interest only at an annual rate of 8.83% on the original $11,000,000 principal balance through the effective date of the refinancing. JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (5) PARTNERSHIP AGREEMENT Pursuant to the terms of the Partnership Agreement, net profits or losses of the Partnership from operations generally are allocated 96% to the Limited Partners and 4% to the General Partners. Profits or losses for Federal income tax purposes from the sale or refinancing of properties generally will be allocated 99% to the Limited Partners and 1% to the General Partners. However, net profits from the sale of properties will be additionally allocated to the General Partners (i) to the extent that cash distributions to the General Partners of sale proceeds from such sale exceed the aforesaid 1% of such profits and (ii) in order to reduce deficits, if any, in the General Partners' capital accounts to a level consistent with the gain anticipated to be realized from the sale of additional properties. The General Partners have made capital contributions to the Partnership aggregating $20,000. The General Partners are not required to make any additional capital contributions except under certain limited circumstances upon dissolution and termination of the Partnership. Disburseable cash from operations, as defined in the Partnership Agreement, will be distributed 90% to the Limited Partners and 10% to the General Partners, subject to certain limitations. Sale or refinancing proceeds will be distributed 100% to the Limited Partners until the Limited Partners have received their contributed capital plus a stipulated return thereon. The General Partners will then receive 100% of the sale or refinancing proceeds until they receive amounts equal to (i) the cumulative deferral of their 10% distribution of disburseable cash and (ii) 2% of the selling prices of all properties which have been sold, subject to certain limitations. Any remaining sale or refinancing proceeds will then be distributed 85% to the Limited Partners and 15% to the General Partners. Accordingly, approximately $3,265,000 of disburseable cash and approximately $618,000 of sale proceeds from Mid Rivers Mall has been deferred by the General Partners (note 7). (6) MANAGEMENT AGREEMENTS - OTHER THAN VENTURES Rivertree Court Shopping Center, Fountain Valley Industrial Park and Cerritos Industrial Park are managed by an affiliate of the Managing General Partner of the Partnership. The fee for managing Rivertree Court is equal to 3% of minimum and percentage rents of the property. The fee for managing the Industrial Parks is equal to 3.75% of gross receipts of the properties. (7) SALE OF MID RIVERS MALL On January 30, 1992, the Partnership, through JMB/Rivers, sold its interest in the Mid Rivers Mall located in St. Peters, Missouri to the unaffiliated joint venture partner. The sale price of the interest was $26,500,000 (before closing costs and prorations) plus the outstanding balance of the mortgages of which JMB/Rivers' share was $35,318,171. The Partnership received in connection with the sale, after all fees, expenses and joint venture partner's participation, a net amount of cash of $13,250,000. For financial reporting purposes, JMB/Rivers had recognized a gain of approximately $12,022,000 in 1992, of which the Partnership's share was approximately $6,366,000. JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (8) LEASES As Property Lessor The Partnership and its consolidated venture's principal assets are two multi-tenant industrial building complexes, a shopping center and a parking/retail structure. The Partnership has determined that all leases relating to these properties are properly classified as operating leases; therefore, rental income is reported when earned and the cost of the properties, excluding the cost of the land, is depreciated over their estimated useful lives. Leases with tenants range in term from one to twenty years and provide for fixed minimum rent and partial reimbursement of operating costs. In addition, leases with shopping center tenants provide for additional rent based upon percentages of tenants' sales volumes. With respect to the Partnership's shopping center investments, a substantial portion of the ability of retail tenants to honor their leases is dependent upon the retail economic sector. Cost and accumulated depreciation of the leased assets are summarized as follows at December 31, 1993: Industrial Building Complexes: Cost. . . . . . . . . . . . . . . . . . . $36,956,309 Accumulated depreciation. . . . . . . . . (4,545,732) ----------- 32,410,577 ----------- Shopping Center: Cost. . . . . . . . . . . . . . . . . . . 39,173,543 Accumulated depreciation. . . . . . . . . (5,432,158) ----------- 33,741,385 ----------- Parking/Retail Structure: Cost. . . . . . . . . . . . . . . . . . . 22,390,562 Accumulated depreciation. . . . . . . . . (1,648,298) ----------- 20,742,264 ----------- $86,894,226 =========== Minimum lease payments, including amounts representing executory costs (e.g. taxes, maintenance, insurance) and any related profit, to be received in the future under the operating leases are as follows: 1994. . . . . . . . . . . . . . . . . . . . $ 6,130,496 1995. . . . . . . . . . . . . . . . . . . . 5,558,448 1996. . . . . . . . . . . . . . . . . . . . 4,937,843 1997. . . . . . . . . . . . . . . . . . . . 4,271,664 1998. . . . . . . . . . . . . . . . . . . . 3,414,456 Thereafter. . . . . . . . . . . . . . . . . 17,941,608 ----------- Total. . . . . . . . . . . . . . . . . $42,254,515 =========== JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (9) TRANSACTIONS WITH AFFILIATES Reimbursable expenses required to be paid by the Partnership to affiliates of the General Partners as of December 31, 1993 and for the years ended December 31, 1993, 1992 and 1991, are as follows:
UNPAID AT DECEMBER 31, 1993 1992 1991 1993 -------- -------- -------- ------------- Property management fees . . . . . . . . . . . . . . . . . . . . $231,529 202,585 198,743 3,638 Insurance commissions. . . . . . . . . . . . . . . . . . . . . . 10,861 9,960 27,177 -- Reimbursement (at cost) for accounting services. . . . . . . . . 76,373 62,996 93,816 76,373 Reimbursement (at cost) for legal services . . . . . . . . . . . 2,035 10,085 5,671 2,035 Reimbursement (at cost) for out-of-pocket expenses . . . . . . . 11,206 11,394 544 1,122 -------- -------- -------- ------- $332,004 297,020 325,951 83,168 ======== ======== ======== =======
JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED In accordance with the subordination requirements of the Partnership Agreement (note 5), the General Partners have deferred payment of certain of their distributions of net cash flow from the Partnership. All amounts deferred or currently payable do not bear interest. (10) INVESTMENT IN UNCONSOLIDATED VENTURES Summary combined financial information for JMB/Rivers, First Financial and JMB/Miami (note 3) as of and for the years ended December 31, 1993 and 1992 is as follows: 1993 1992 ------------ ------------ Current assets . . . . . . . . . . $ 4,571,308 3,449,168 Other current liabilities. . . . . (975,901) (1,218,915) ------------ ------------ Working capital. . . . . . . . 3,595,407 2,230,253 Investment property, net . . . . . 87,047,194 89,900,221 Other assets, net. . . . . . . . . 2,193,963 2,035,457 Long-term debt . . . . . . . . . . (76,661,145) (74,339,146) Other liabilities. . . . . . . . . (253,238) (212,250) Venture partners' equity . . . . . (5,142,800) (7,774,113) ------------ ------------ Partnership's capital. . . . . $ 10,779,381 11,840,422 ============ ============ Represented by: Invested capital . . . . . . . . $ 32,035,179 31,980,948 Cumulative distributions . . . . (26,933,034) (26,150,584) Cumulative earnings (loss) . . . 5,677,236 6,010,058 ------------ ------------ $ 10,779,381 11,840,422 ============ ============ Total income . . . . . . . . . . . $ 18,281,016 18,104,319 ============ ============ Operating expenses . . . . . . . . $ 18,540,392 19,014,371 ============ ============ Operating loss . . . . . . . . . . $ (259,376) (910,052) ============ ============ Gain on sale of land and property. $ 1,384,831 12,022,339 ============ ============ Extraordinary item . . . . . . . . $ (2,084,731) -- ============ ============ Net income (loss). . . . . . . . . $ (959,276) 11,112,287 ============ ============ JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONCLUDED Total income, operating expenses and net loss of the above-mentioned ventures for the year ended December 31, 1991 were $26,027,541, $27,409,527 and $1,381,986, respectively. (11) SUBSEQUENT EVENTS (a) Distributions In February 1994, the Partnership paid a distribution of $1,264,140 ($10.00 per interest) to the Limited Partners, $12,769 to the Special Limited Partner and $35,470 to the General Partners. (b) Re-financing In February 1994, the Partnership extended and increased the first mortgage loan to the principal amount of $11,200,000, which is secured by the Fountain Valley and Cerritos Industrial Parks. The extended loan bears interest at a rate of 7.32% per annum, provides for monthly payments of principal and interest based on a twenty-year amortization period and matures March 1, 2001. See note 4(b). Schedule X JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE SUPPLEMENTARY INCOME STATEMENT INFORMATION Years ended December 31, 1993, 1992 and 1991 CHARGED TO COSTS AND EXPENSES --------------------------------------------- 1993 1992 1991 ---------- ---------- ---------- Maintenance and repairs. $1,010,757 1,082,912 945,276 Depreciation . . . . . . 2,476,913 2,454,001 2,415,414 Amortization of deferred expenses . . . 175,953 150,274 259,006 Real estate taxes. . . . 1,554,115 1,340,044 1,583,637 ========== ========== ========== SCHEDULE XI JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1993
COSTS CAPITALIZED INITIAL COST TO SUBSEQUENT TO GROSS AMOUNT AT WHICH CARRIED PARTNERSHIP (A) ACQUISITION AT CLOSE OF PERIOD (B) ----------------------- ----------------------- -------------------------------------- BUILDINGS BUILDINGS BUILDINGS ENCUM- AND AND AND BRANCE LAND IMPROVEMENTS LAND IMPROVEMENTS LAND IMPROVEMENTS TOTAL (C) ------ -------- ------------ -------- ------------ -------- ------------ ---------- Industrial Complexes: Fountain Valley Industrial Park and Cerritos Industrial Park . . . $11,000,000 9,111,020 25,783,707 -- 2,061,582 9,111,020 27,845,289 36,956,309 Shopping Center: Rivertree Court Shopping Center . . . 15,700,000 7,893,178 30,830,231 -- 450,134 7,893,178 31,280,365 39,173,543 Parking/Retail: Adams/Wabash Self Park . . . . . . -- 6,530,093 14,547,233 32,411 1,280,825 6,562,504 15,828,058 22,390,562 ----------- ---------- ---------- ----------- --------- ---------- ---------- ---------- Total. . . . . . . $26,700,000 23,534,291 71,161,171 32,411 3,792,541 23,566,702 74,953,712 98,520,414 =========== ========== ========== =========== ========= ========== ========== ==========
SCHEDULE XI - CONTINUED JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1993
LIFE ON WHICH DEPRECIATION IN LATEST STATEMENT OF 1993 ACCUMULATED DATE OF DATE OPERATIONS REAL ESTATE DEPRECIATION(D) CONSTRUCTION ACQUIRED IS COMPUTED TAXES ---------------- ------------ ---------- --------------- ----------- Industrial Complexes: Fountain Valley Industrial Park and Cerritos Industrial Park . . . . . . . . . . . . . . $ 4,545,732 1967-1970 11/1/88 5-30 years 415,565 Shopping Center: Rivertree Court Shopping Center . . . . . . . . . . . . . . 5,432,158 1988 10/20/88 5-30 years 597,006 Parking/Retail: Adams/Wabash Self Park . . . . . . . . . . . . . . . . . 1,648,298 1989-1990 10/1/90 30 years 558,746 ----------- Total. . . . . . . . . . . . . . . . . . $11,626,188 =========== - ------------------ (A) The initial cost to the Partnership represents the original purchase price of the properties, including amounts incurred subsequent to acquisition which were contemplated at the time the property was acquired. (B) The aggregate cost of real estate owned at December 31, 1993 for Federal income tax purposes was $75,706,877.
SCHEDULE XI - CONTINUED JMB INCOME PROPERTIES, LTD. - XIII (A LIMITED PARTNERSHIP) AND CONSOLIDATED VENTURE CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1993 (C) Reconciliation of real estate owned:
1993 1992 1991 ----------- ----------- ----------- Balance at beginning of period . . . . . . . $97,795,042 97,147,324 95,137,653 Additions during period. . . . . . . . . . . 725,372 647,718 2,009,671 ----------- ----------- ----------- Balance at end of period . . . . . . . . . . $98,520,414 97,795,042 97,147,324 =========== =========== =========== (D) Reconciliation of accumulated depreciation: Balance at beginning of period . . . . . . . $ 9,149,275 6,695,274 4,279,860 Depreciation expense . . . . . . . . . . . . 2,476,913 2,454,001 2,415,414 ----------- ----------- ----------- Balance at end of period . . . . . . . . . . $11,626,188 9,149,275 6,695,274 =========== =========== ===========
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE There were no changes of, or disagreements with, accountants during fiscal years 1993 and 1992. PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE PARTNERSHIP The Managing General Partner of the Partnership is JMB Realty Corporation ("JMB"), a Delaware Corporation. JMB has responsibility for all aspects of the Partnership's operations, subject to the requirement that purchases and sales of real property must be approved by the Associate General Partner of the Partnership, Income Associates-XIII, L.P. an Illinois limited partnership with JMB as the sole general partner. The Associate General Partner shall be directed by a majority in interest of its limited partners (who are generally officers, directors and affiliates of JMB or its affiliates) as to whether to provide its approval of any sale of real property (or any interest therein) of the Partnership. The relationship of the Managing General Partner to its affiliates is described under the caption "Conflicts of Interest" at pages 12-18 of the Prospectus, which description is hereby incorporated herein by reference to Exhibit 3-A to the Partnership's Report on Form 10-K for December 31, 1992 (File No. 000-19496) dated March 18, 1993. The names, positions held and length of service therein of each director and executive officer and certain officers of the Managing General Partner of the Partnership are as follows: SERVED IN NAME OFFICE OFFICE SINCE - ---- ------ ------------ Judd D. Malkin Chairman 5/03/71 Director 5/03/71 Neil G. Bluhm President 5/03/71 Director 5/03/71 Jerome J. Claeys III Director 5/09/88 Burton E. Glazov Director 7/01/71 Stuart C. Nathan Executive Vice President 5/08/79 Director 3/14/73 A. Lee Sacks Director 5/09/88 John G. Schreiber Director 3/14/73 H. Rigel Barber Chief Executive Officer 8/01/93 Jeffrey R. Rosenthal Chief Financial Officer 8/01/93 Gary Nickele Executive Vice President 1/01/92 General Counsel 2/27/84 Ira J. Schulman Executive Vice President 6/01/88 Gailen J. Hull Senior Vice President 6/01/88 Howard Kogen Senior Vice President 1/02/86 Treasurer 1/01/91 There is no family relationship among any of the foregoing directors or officers. The foregoing directors have been elected to serve a one-year term until the annual meeting of the Managing General Partner to be held on June 7, 1994. All of the foregoing officers have been elected to serve one-year terms until the first meeting of the Board of Directors held after the annual meeting of the Managing General Partner to be held on June 7, 1994. There are no arrangements or understandings between or among any of said directors or officers and any other person pursuant to which any director or officer was elected as such. JMB is the corporate general partner of Carlyle Real Estate Limited Partnership-VII ("Carlyle-VII"), Carlyle Real Estate Limited Partnership-IX ("Carlyle-IX"), Carlyle Real Estate Limited Partnership-X ("Carlyle-X"), Carlyle Real Estate Limited Partnership-XI ("Carlyle-XI"), Carlyle Real Estate Limited Partnership-XII ("Carlyle-XII"), Carlyle Real Estate Limited Partnership-XIII ("Carlyle-XIII"), Carlyle Real Estate Limited Partnership-XIV ("Carlyle-XIV"), Carlyle Real Estate Limited Partnership-XV ("Carlyle-XV"), Carlyle Real Estate Limited Partnership-XVI ("Carlyle-XVI"), Carlyle Real Estate Limited Partnership-XVII ("Carlyle-XVII"), JMB Mortgage Partners, Ltd. ("Mortgage Partners"), JMB Mortgage Partners, Ltd.-II ("Mortgage Partners-II"), JMB Mortgage Partners, Ltd.-III ("Mortgage Partners-III"), JMB Mortgage Partners, Ltd.-IV ("Mortgage Partners-IV"), Carlyle Income Plus, Ltd. ("Carlyle Income Plus") and Carlyle Income Plus, Ltd.-II ("Carlyle Income Plus-II") and the managing general partner of JMB Income Properties, Ltd.-IV ("JMB Income-IV"), JMB Income Properties, Ltd.-V ("JMB Income-V"), JMB Income Properties, Ltd.-VI ("JMB Income-VI"), JMB Income Properties, Ltd.-VII ("JMB Income-VII"), JMB Income Properties, Ltd.-VIII ("JMB Income-VIII"), JMB Income Properties, Ltd.-IX ("JMB Income-IX"), JMB Income Properties, Ltd.-X ("JMB Income-X"), JMB Income Properties, Ltd.-XI ("JMB Income-XI") and JMB Income Properties, Ltd.-XII ("JMB Income-XII"). Most of the foregoing directors and officers are also officers and/or directors of various affiliated companies of JMB including Arvida/JMB Managers, Inc. (the general partner of Arvida/JMB Partners, L.P. ("Arvida")), Arvida/JMB Managers-II, Inc. (the general partner of Arvida/JMB Partners, L.P.-II ("Arvida-II") and Income Growth Managers, Inc. (the corporate general partner of IDS/JMB Balanced Income Growth, Ltd. ("IDS/BIG")). Most of such directors and officers are also partners of certain partnerships which are associate general partners in the following real estate limited partnerships: Carlyle-VII, Carlyle-IX, Carlyle-X, Carlyle-XI, Carlyle-XII, Carlyle-XIII, Carlyle-XIV, Carlyle-XV, Carlyle-XVI, Carlyle-XVII, JMB Income-VI, JMB Income-VII, JMB Income-VIII, JMB Income-IX, JMB Income-X, JMB Income-XI, JMB Income-XII, Mortgage Partners, Mortgage Partners-II, Mortgage Partners-III, Mortgage Partners-IV, Carlyle Income Plus, Carlyle Income Plus-II and IDS/BIG. The business experience during the past five years of each such director and officer of the Managing General Partner of the Partnership in addition to that described above is as follows: Judd D. Malkin (age 56) is an individual general partner of JMB Income-IV and JMB Income-V. Mr. Malkin has been associated with JMB since October, 1969. He is a Certified Public Accountant. Neil G. Bluhm (age 56) is an individual general partner of JMB Income-IV and JMB Income-V. Mr. Bluhm has been associated with JMB since August, 1970. He is a member of the Bar of the State of Illinois and a Certified Public Accountant. Jerome J. Claeys III (age 51) (Chairman and Director of JMB Institutional Realty Corporation) has been associated with JMB since September, 1977. He holds a Masters degree in Business Administration from the University of Notre Dame. Burton E. Glazov (age 55) has been associated with JMB since June, 1971 and served as an Executive Vice President of JMB until December of 1990. He is a member of the Bar of the State of Illinois and a Certified Public Accountant. Stuart C. Nathan (age 52) has been associated with JMB since July, 1972. He is a member of the Bar of the State of Illinois. A. Lee Sacks (age 60) (President and Director of JMB Insurance Agency, Inc.) has been associated with JMB since December, 1972. John G. Schreiber (age 47) has been associated with JMB since December, 1970 and served as an Executive Vice President of JMB until December 1990. He holds a Masters degree in Business Administration from Harvard University Graduate School of Business. H. Rigel Barber (age 44) has been associated with JMB since March, 1982. He holds a J.D. degree from the Northwestern Law School and is a member of the Bar of the State of Illinois. Jeffrey R. Rosenthal (age 42) has been associated with JMB since December, 1987. He is a Certified Public Accountant. Gary Nickele (age 41) has been associated with JMB since February, 1984. He holds a J.D. degree from the University of Michigan Law School and is a member of the Bar of the State of Illinois. Ira J. Schulman (age 42) has been associated with JMB since February, 1983. He holds a Masters degree in Business Administration from the University of Pittsburgh. Gailen J. Hull (age 45) has been associated with JMB since March, 1982. He holds a Masters degree in Business Administration from Northern Illinois University and is a Certified Public Accountant. Howard Kogen (age 58) has been associated with JMB since March, 1973. He is a Certified Public Accountant. ITEM 11. EXECUTIVE COMPENSATION The officers and director of the Managing General Partner receive no current or proposed direct remuneration in such capacities. The General Partners of the Partnership are entitled to receive a share of cash distributions, when and as cash distributions are made to the Investors, and a share of profits or losses as described under the caption "Cash Distributions; Allocations of Profits and Losses" at pages A-9 to A-15 of the Partnership Agreement included as an exhibit to the Prospectus, which descriptions are hereby incorporated herein by reference to Exhibit 3-A to the Partnership's Report on Form 10-K for December 31, 1992 (File No. 000-19496) dated March 18, 1993. Reference is also made to Notes 5 and 9 for a description of such transactions, distributions and allocations. In 1993, 1992 and 1991, the General Partners received cash distributions in the amount of $141,879, $141,879 and $154,293, respectively. As of December 31, 1993, the General Partners have deferred payment of distributions in the aggregate amount of $3,265,057. The General Partners of the Partnership may be reimbursed for their direct expenses relating to the offering, the administration of the Partnership and the operation of the Partnership's real property investments. In 1993, an affiliate of the General Partners was due reimbursement for such out-of-pocket expenses in the amount of $11,206, of which $1,122 was unpaid at December 31, 1993. The General Partners may be reimbursed for salaries and direct expenses of officers and employees of the Managing General Partner and its affiliates while directly engaged in the administration of the Partnership and the operation of the Partnership's real property investments. In 1993, the Managing General Partner was due reimbursement for such expenses in the amount of $78,408, all of which was unpaid as of December 31, 1993. An affiliate of the General Partners provided property management services for the Fountain Valley and Cerritos Industrial Parks and the Rivertree Court Shopping Center during 1993. In 1993, such affiliate earned property management fees amounting to $231,529, of which $3,638 was unpaid as of December 31, 1993. JMB Insurance Agency, Inc., an affiliate of the Managing General Partner of the Partnership, earned and received insurance brokerage commissions in 1993 aggregating $10,861 in connection with the providing of insurance coverage for certain of the real property investments of the Partnership. Such commissions are at rates set by insurance companies for the classes of coverage provided. The Partnership is permitted to engage in various transactions involving affiliates of the Managing General Partner of the Partnership, as described under the captions "Compensation and Fees" at pages 8 to 12, and "Conflicts of Interest" at pages 12-19 of the Prospectus, which descriptions are hereby incorporated herein by reference to Exhibit 3-A to the Partnership's Report on Form 10-K for December 31, 1992 (File No. 000-19496) dated March 18, 1993, and under the caption "Rights, Powers and Duties of General Partners" at pages A-17 to A-28 of the Partnership Agreement, included as an exhibit to the Prospectus. The relationship of the Managing General Partner (and its directors and officers) to its affiliates is set forth in Item 10 above and Exhibit 21 hereto.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT (a) No person or group is known by the Partnership to own beneficially more than 5% of the outstanding Interests of the Partnership. (b) The Managing General Partner and its officers and directors own the following Interests of the Partnership: NAME OF AMOUNT AND NATURE BENEFICIAL OF BENEFICIAL PERCENT TITLE OF CLASS OWNER OWNERSHIP OF CLASS - -------------- ---------- ----------------- -------- Limited Partnership Interests Gary Nickele 5 Interests (1) Less than 1% indirectly Limited Partnership Interests Managing General Partner 5 Interests (1) Less than 1% and its officers and indirectly directors as a group (1) Includes 5 Interests owned by an affiliated corporation as to which Gary Nickele has sole investment and voting power. All of the outstanding shares of the Managing General Partner of the Partnership are owned by an affiliate of its officers and directors as set forth above in Item 10. (c) There exists no arrangement, known to the Partnership, the operation of which may at a subsequent date result in a change in control of the Partnership.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS There were no significant transactions or business relationships with the Managing General Partner, affiliates or their management other than those described in Items 10 and 11 above. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K (a) The following documents are filed as part of this report: (1) Financial Statements (See Index to Financial Statements filed with this annual report). (2) Exhibits. 3-A. The Prospectus of the Partnership dated August 20, 1986 as supplemented October 31, 1986 and January 26, 1987 as filed with the Commission pursuant to Rules 424(b) and 424(c) is hereby incorporated herein by reference. Copies of pages 8-19, 64-70, A-7 to A-16, A-34 to A-35 of the Prospectus are hereby incorporated by reference to Exhibit 3-A to the Partnership's Form 10-K dated March 18, 1993. 3-B. Amended and Restated Agreement of Limited Partnership set forth as Exhibit A to the Prospectus, which is hereby incorporated by reference to Exhibit 3-B to the Partnership's From 10-K dated March 18, 1993. 4-A. Copy of documents relating to the mortgage loan secured by the Rivertree Court Shopping Center, Vernon Hills (Chicago), Illinois dated December 30, 1988 is hereby incorporated by reference to Exhibit 4-A to the Partnership's Form 10-K dated March 18, 1993. 4-B. Copy of documents relating to the mortgage loan secured by a first mortgage on West Dade's interest in Miami International Mall, Miami, Florida dated December 21, 1993 is filed herewith. 10-A. Acquisition documents relating to the purchase by the Partnership of Rivertree Court Shopping Center in Vernon Hills (Chicago), Illinois, are hereby incorporated by reference to Exhibit 1 to the Partnership's Form 8-K dated November 4, 1988. 10-B. Acquisition documents relating to the purchase by the Partnership of Fountain Valley Industrial Buildings in Fountain Valley, California and Cerritos Industrial Buildings in Cerritos, California, are hereby incorporated by reference to Exhibits 1 and 2 to the Partnership's Form 8-K dated November 15, 1988. 10-C. Acquisition documents relating to the acquisition by the Partnership of an interest in the Adams/Wabash Parking Garage in Chicago, Illinois are hereby incorporated by reference to Exhibit 3 to the Partnership's Form 8-K dated October 15, 1990. 10-D. Sale documents and exhibits thereto relating to the sale of the Partnership's interest in Mid Rivers Mall in St. Peters (St. Louis), Missouri are hereby incorporated by reference to the Partnership's Report on Form 8-K dated February 18, 1992. 21. List of Subsidiaries. 24. Powers of Attorney Although certain long-term debt instruments of the Registrant have been excluded from Exhibit 4 above, pursuant to Rule (b)(4)(iii), the Registrants commits to provide copies of such agreements to the Securities and Exchange Commission upon request. (b) No reports on Form 8-K were required to be filed during the last quarter of the period covered by this annual report. No annual report or proxy material for the fiscal year 1993 has been sent to the Partners of the Partnership. An annual report will be sent to the Partners subsequent to this filing. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of 1934, the Partnership has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. JMB INCOME PROPERTIES, LTD. - XIII By: JMB Realty Corporation Managing General Partner GAILEN J. HULL By: Gailen J. Hull Senior Vice President Date:March 25, 1994 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: JMB Realty Corporation Managing General Partner JUDD D. MALKIN* By: Judd D. Malkin, Chairman and Director Date:March 25, 1994 NEIL G. BLUHM* By: Neil G. Bluhm, President and Director Date:March 25, 1994 H. RIGEL BARBER* By: H. Rigel Barber, Chief Executive Officer Date:March 25, 1994 JEFFREY R. ROSENTHAL* By: Jeffrey R. Rosenthal, Chief Financial Officer Principal Financial Officer Date:March 25, 1994 GAILEN J. HULL By: Gailen J. Hull, Senior Vice President Principal Accounting Officer Date:March 25, 1994 A. LEE SACKS* By: A. Lee Sacks, Director Date:March 25, 1994 STUART C. NATHAN* By: Stuart C. Nathan, Executive Vice President and Director Date:March 25, 1994 *By: GAILEN J. HULL, Pursuant to a Power of Attorney GAILEN J. HULL By: Gailen J. Hull, Attorney-in-Fact Date:March 25, 1994 JMB INCOME PROPERTIES, LTD. - XIII EXHIBIT INDEX DOCUMENT INCORPORATED BY REFERENCE PAGE ------------ ---- 3-A. Pages 8-19, 64-70, A-7 to A-16, A-34 to A-35 of the Prospectus of the Partnership dated August 20, 1986, as supplemented on October 31, 1986, and January 26, 1987 Yes 3-B. Amended and Restated Agreement of Limited Partnership Yes 4-A. Mortgage loan agreement related to the Rivertree Court Shopping Center Yes 4-B. Mortgage loan agreement related to West Dade No 10-A. Acquisition documents relating to the Rivertree Court Shopping Center Yes 10-B. Acquisition documents relating to the Fountain Valley Industrial Buildings and Cerritos Industrial Buildings Yes 10-C. Acquisition documents relating to the Adams/Wabash Parking Garage Yes 10-D. Sale documents relating to the Mid Rivers Mall Yes 21. List of Subsidiaries No 24. Powers of Attorney No EX-21 2 EXHIBIT TO 10K EXHIBIT 21 LIST OF SUBSIDIARIES The Partnership is a general partner in JMB First Financial Associates, an Illinois general partnership. JMB First Financial Associates is a general partner in JMB Encino Partnership, a California general partnership, which holds title to the First Financial Plaza. The Partnership is a general partner in JMB/Miami International Associates, an Illinois general partnership. JMB/Miami International Associates is a general partner in West Dade County Associates, a Florida general partnership which holds title to the Miami International Mall. The Partnership is a limited partner in Adams/Wabash Limited Partnership, an Illinois limited partnership. Adams/Wabash Limited Partnership holds title to the Adams/Wabash Self Park. Reference is made to Note 3 of the Notes to Financial Statements filed with this annual report for a summary description of the terms of such partnership agreements. The Partnership's interest in the foregoing joint venture partnerships and the results of their operations are included in the Financial Statements of the Partnership filed with this annual report. EX-4 3 EXHIBIT TO 10K ASSIGNMENT OF MORTGAGE AND SECURITY AGREEMENT AND ASSIGNMENT OF NOTE AND OTHER LOAN DOCUMENTS KNOW ALL MEN BY THESE PRESENTS that Teachers Insurance and Annuity Association of America, a New York corporation, having an office at 730 Third Avenue, New York, New York 10017 ("Teachers") as the owner and holder of the following documents (herein collectively referred to as the "Existing Loan Documents"): A. "NOTE": Mortgage Note dated January 27, 1981 from West Dade County Associates ("Borrower") to Mellon Bank, N.A. ("Mellon") in the face amount of THIRTY-EIGHT MILLION AND NO/100THS DOLLARS ($38,000,000.00), the Mortgage Note dated November 29, 1982 from Borrower to Mellon in the face amount of FIVE MILLION EIGHT HUNDRED THOUSAND AND NO/100THS DOLLARS ($5,800,000.00), the Note Extension Agreement dated January 27, 1984 by and between Borrower and Mellon extending the term of the aforedescribed two Notes, Mortgage Note dated March 28, 1985 from Borrower to Teachers Insurance and Annuity Association of America ("Teachers") in the face amount of SEVEN MILLION SIX HUNDRED TWENTY-TWO THOUSAND NINE HUNDRED THIRTY- EIGHT AND 11/100THS DOLLARS ($7,622,938.11), all of the foregoing Notes as consolidated, modified and extended, in a Consolidating Note Agreement dated March 28, 1985 between Borrower and Teachers (collectively referred to as the "Note"). B. "MORTGAGE": That certain Mortgage and Security Agreement executed by Borrower to Mellon dated January 27, 1981 and recorded on January 30, 1981 in Official Records Book 11001, Page 1488, Public Records of Dade County, Florida, Supplement to Mortgage and Security Agreement by and between Borrower and Mellon dated November 29, 1982 and recorded December 2, 1992 in Official Records Book 11629, Page 2341, Public Records of Dade County, Florida, all of the foregoing being assigned by Mellon to Teachers by Assignment of Mortgage and Security Agreement from Mellon to Teachers dated March 22, 1985, recorded March 29, 1985 in Official Records Book 12460, Page 3210, Public Records of Dade County, Florida, and by instrument of assignment from Mellon to Teachers dated March 22, 1985, recorded March 29, 1985 in Official Records Book 12460, Page 3213, Public Records of Dade County, Florida, Mortgage Deed from Borrower to Teachers dated March 28, 1985 and recorded March 29, 1985 in Official Records Book 12460, Page 3307, Public Records of Dade County, Florida, all of the foregoing being consolidated, modified and extended in Consolidation, Modification and Extension Agreement by and between Borrower and Teachers dated March 28, 1985 and recorded March 29, 1985 in Official Records Book 12460, Page 3257, Public Records of Dade County, Florida, and being further modified by Partial Release, Spreader and Modification Agreement between Borrower and Teachers dated October 1, 1991 and recorded October 22, 1991 in Official Records Book 15238, Page 2329, Public Records of Dade County, Florida (collectively referred to as the "Mortgage"). C. "ASSIGNMENT OF LEASES": Assignment of Lessor's Interest in Leases by Borrower unto Teachers dated March 28, 1985 and recorded March 29, 1985 in Official Records Book 12460, Page 3236, Public Records of Dade County, Florida; Assignment of Leases, Rents, and Operating Agreements dated January 27, 1981 recorded January 30, 1981 in Official Records Book 11001, Page 1529, Public Records of Dade County, Florida; and Supplement to Assignment of Leases, Rents and Operating Agreements between Borrower and Mellon dated November 29, 1982 recorded December 2, 1982 in Official Records Book 11629, Page 2346, Public Records of Dade County, Florida. D. "OTHER EXISTING LOAN DOCUMENTS": Certain other loan documents pertaining to the loan evidenced and secured by the foregoing loan documents set forth in the Certificate of Existing Lender from Teachers to the Prudential Insurance Company of America of even date herewith as documents #'s 4-18 under the caption "III. All Existing Loan Documents". AND IN CONSIDERATION of the sum of Ten Dollars ($10.00) to it in hand paid by The Prudential Insurance Company of America, a New Jersey corporation, having an office at One Ravinia Drive, Suite 1400, Atlanta, Georgia 30346 ("Prudential"), the receipt and sufficiency of which is acknowledged, Teachers has sold, assigned, transferred and set over, and by this Assignment does sell, assign, transfer and set over to Prudential, without recourse and without warranty (except as set forth in said Certificate of Existing Lender), all of Teachers right, title and interest in each of the Existing Loan Documents, including, but not by way of limitation, the Note and the obligations described therein and the monies due and to become due thereunder, with interest from and after the _____ day of December, 1993, the Mortgage, Assignment of Leases, and Other Existing Loan Documents. This is an absolute assignment and not a collateral assignment to secure obligations. TO HAVE AND TO HOLD the same unto Prudential, its successors and assigns forever. IN WITNESS WHEREOF, Teachers has caused this Assignment to be executed as of the _____ day of _______________, 1993. Signed, sealed and delivered in TEACHERS INSURANCE AND ANNUITY the presence of the following ASSOCIATION OF AMERICA, A NEW two witnesses as to both YORK CORPORATION signatories: ______________________________ By:___________________________ (Signed Name Witness One) Name:_________________________ ______________________________ (Printed Name of Witness One) Title:________________________ ______________________________ (Signed Name of Witness Two) ______________________________ (Printed Name of Witness Two) STATE OF NEW YORK ) ) ss COUNTY OF NEW YORK ) The foregoing instrument was acknowledged before me, this ____ day of _______________, 1993, by _______________, as the _________________________ of TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA on behalf of said corporation. Said person did not take an oath and is personally known to me or has produced, as identification, a drivers license issued by a State of the United States, which is either current or has been issued within the past five (5) years and bears a serial or other identifying number. ______________________________ Notary Public ______________________________ (Printed Name) [NOTARIAL SEAL] My Commission Expires: EX-99 4 EXHIBIT TO 10K LOAN NUMBER 6 100 405 CONSOLIDATED, MODIFIED, RENEWED AND RESTATED PROMISSORY NOTE THIS CONSOLIDATED, MODIFIED, RENEWED AND RESTATED PROMISSORY NOTE is made this ____ day of December, 1993, to be effective as of and from the ____ day of December, 1993, by WEST DADE COUNTY ASSOCIATES, a Florida general partnership having offices in care of The Edward J. DeBartolo Corporation, 7620 Market Street, Youngstown, Ohio 44513-6085 ("Borrower"), unto THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, a New Jersey corporation, having offices at One Ravinia Drive, Suite 1400, Atlanta, Georgia 30346 ("Lender") pursuant to an Agreement of Consolidation, Modification, Renewal and Restatement by and between Borrower and Lender of even date herewith. RECITALS: A. Lender is now the owner and holder of a Mortgage Note dated January 27, 1981 from Borrower to Mellon Bank, N.A. ("Mellon") in the face amount of THIRTY-EIGHT MILLION AND NO/100THS DOLLARS ($38,000,000.00), the Mortgage Note dated November 29, 1982 from Borrower to Mellon in the face amount of FIVE MILLION EIGHT HUNDRED THOUSAND AND NO/100THS DOLLARS ($5,800,000.00), the Note Extension Agreement dated January 27, 1984 by and between Borrower and Mellon extending the term of the aforedescribed two Notes, the Mortgage Note dated March 28, 1985 from Borrower to Teachers Insurance and Annuity Association ("Teachers") in the face amount of SEVEN MILLION SIX HUNDRED TWENTY-TWO THOUSAND NINE HUNDRED THIRTY-EIGHT AND 11/100THS DOLLARS ($7,622,938.11), and a Consolidating Note Agreement dated March 28, 1985 between Borrower and Teachers; all of which, on even date herewith, was assigned from Teachers to Lender (collectively referred to as the "Prior Note"). B. As of the date hereof, the outstanding principal balance of the Prior Note is FORTY-FOUR MILLION SEVEN HUNDRED EIGHTY-FIVE THOUSAND SEVEN HUNDRED TEN AND 39/100THS DOLLARS ($44,785,710.39). C. Lender is now the owner and holder of a certain Mortgage and Security Agreement executed by Borrower to Mellon dated January 27, 1981 and recorded on January 30, 1981 in the Official Records Book 11001, Page 1488, Public Records of Dade County, Florida, and a Supplement to Mortgage and Security Agreement by and between Borrower and Mellon dated November 29, 1982 and recorded December 2, 1992 in the Official Records Book 11629, Page 2341, Public Records of Dade County, Florida, all of the foregoing being assigned by Mellon to Teachers by Assignment of Mortgage and Security Agreement from Mellon to Teachers dated March 22, 1985, and recorded March 29, 1989 in the Official Records Book 12460, Page 3210, Public Records of Dade County, Florida, and by an instrument of assignment from Mellon to Teachers dated March 22, 1985, and recorded March 29, 1985 in the Official Records Book 12460, Page 3213, Public Records of Dade County, Florida, a Mortgage Deed from Borrower to Teachers dated March 28, 1985 and recorded March 29, 1985 in the Official Records Book 12460, Page 3307, Public Records of Dade County, Florida, a Consolidation, Modification and Extension Agreement by and between Borrower and Teachers dated March 28, 1985 and recorded March 29, 1985 in the Official Records Book 12460, Page 3257, Public Records of Dade County, Florida, a Partial Release, Spreader and Modification Agreement; all of which on even date herewith, were assigned from Teachers to Lender (collectively, the "Prior Security Instrument"). D. Pursuant to an Agreement of Consolidation, Modification, Renewal and Restatement between Borrower and Lender of even date herewith, Borrower has agreed to execute and deliver and Lender has agreed to accept (i) a Future Advance Note in the amount of $2,714,289.61 from Borrower to Lender of even date herewith; (ii) a Modification, Renewal and Restatement of Mortgage and Security Agreement by Borrower to Lender of even date herewith; and (iii) this Consolidated, Modified, Renewed and Restated Note executed by Borrower to Lender in the principal amount of $47,500,000.00, which consolidates, modifies, renews and restates said Future Advance Note and the Prior Note. NOW, THEREFORE, for and in consideration of the sum of Ten and no/100 Dollars and other good and valuable consideration, the receipt of which is hereby acknowledged, the Prior Note and Future Advance Note are hereby consolidated and are hereby modified, renewed and restated in their entirety to read as follows: [CONTINUED ON NEXT PAGE] LOAN NO. 6 100 405 CONSOLIDATED, MODIFIED, RENEWED AND RESTATED PROMISSORY NOTE $47,500,000.00 December __, 1993 FOR VALUE RECEIVED, the undersigned, WEST DADE COUNTY ASSOCIATES, a Florida general partnership, having offices in care of The Edward J. DeBartolo Corporation, 7620 Market Street, Youngstown, Ohio 44513-6085 ("Borrower") promises to pay to the order of THE PRUDENTIAL INSURANCE COMPANY OF AMERICA ("Lender"), (Lender and its successors and assigns who become holders of this Note are hereinafter collectively referred to as "Holder"), by Federal wire transfer to Holder at Morgan Guaranty Trust Company (ABA # 0210 00 238), 23 Wall Street, New York, New York 10019, Account No. 05054493, referencing Loan No. 6 100 405, or at such other place or manner as Holder may from time to time designate, the principal sum of FORTY-SEVEN MILLION FIVE HUNDRED THOUSAND DOLLARS ($47,500,000.00), or so much thereof as may be advanced by Holder to Borrower, together with interest on the Principal Balance from the date hereof until paid at the rates provided herein. 1. Definitions. For the purpose of this Note, the following terms shall have the meanings set forth below. Capitalized terms not otherwise defined herein shall have the meaning ascribed to such term in the Security Instrument. "Acceleration Notice" shall have the meaning set forth in Paragraph 5.1 of this Note. "DeBartolo" means DeBartolo, Inc. "DeBartolo CAP" shall have the meaning set forth in Paragraph 18 of this Note. "Discount Rate" means the rate which, when compounded monthly, is equivalent to the Treasury Rate when compounded semi-annually. "DRC" means DeBartolo Realty Corporation, an Ohio corporation. "DRPLP" means DeBartolo Realty Partnership, L.P. , a Delaware limited partnership. "DeBartolo Loan Parties" shall have the meaning set forth in Paragraph 18 of this Note. "Exculpated Parties" shall have the meaning set forth in Paragraph 18 of this Note. "Interest Rate" means a rate of interest per annum of six and ninety-one hundredths percent (6.91%). "JMB Cap" shall have the meaning set forth in Paragraph 18 of this Note. "JMB Loan Parties" shall have the meaning set forth in Paragraph 18 of this Note. "Loan Documents" means this Note, the Security Instrument, the Modified and Restated Assignment of Lessor's Interest in Leases, the Agreement of Consolidation, Modification, Renewal and Restatement, the Hazardous Substance Remediation and Indemnification Agreement between Borrower, the Other Loan Parties and Lender of even date herewith, the Other Loan Party Agreement by and between the Other Loan Parties and Lender of even date herewith and all other documents now or hereafter governing, securing or evidencing the Indebtedness (as such term is defined in the Security Instrument). "Loan" means the loan evidenced by this Note. "Maturity" shall mean the Maturity Date or such earlier date as the entire principal balance of the Note may be due and payable by acceleration by the Holder as provided in this Note. "Maturity Date" means the ____ day of December, 2003. "Maximum Rate" shall have the meaning set forth in Paragraph 15 of this Note. "Monthly Due Date" means the 10th day of each calendar month during the term of the Loan. "Monthly Late Charge" means a late charge equal to four percent (4%) of the monthly interest payment or monthly principal and interest payment. "Other Loan Party" means any one of the Other Loan Parties. "Other Loan Parties" shall have the meaning set forth in the Security Instrument. "Per Diem Late Charge" means a late charge of $1,000.00 per day. "Prepayment Date" means any date, prior to the Maturity Date, upon which all or any portion of the Principal Balance is prepaid. "Prepayment Premium" shall have the meaning set forth in Paragraph 6.2 of this Note. "Present Value of the Loan" shall be determined by discounting all scheduled payments of principal and interest, remaining to the Maturity Date with respect to the amount being prepaid, at the Discount Rate. If prepayment occurs on a date other than a regularly scheduled payment date, the actual number of days remaining from the Prepayment Date to the next regularly scheduled payment date will be used to discount within this period. "Principal Balance" means the outstanding principal balance of this Note from time to time outstanding. "Real Estate Security" means the Land, as defined in the Security Instrument, the Improvements, as defined in the Security Instrument, all rents, issues, profits and proceeds therefrom, together with any interest in any ingress or egress easements, the developer's interest in the COREA, as defined in the Security Instrument, or other appurtenances, easements or Borrower's real property rights or interests relating thereto. "Secondary Interest Rate" means a rate of interest per annum equal to the lesser of (1) the maximum rate allowed by the law or (2) the rate which is the greater of (i) a per annum rate equal to four percent (4%) over the Interest Rate or (ii) a per annum rate equal to four percent (4%) over the prime rate (for corporate loans at large United States money center commercial banks) published in the Wall Street Journal on the first business day of each month in which such default occurs or continues. "Security Instrument" means that certain Modification, Renewal and Restatement of Mortgage and Security Agreement of even date herewith, executed by Borrower for the benefit of Holder as security for repayment of this Note. "Treasury Rate" means the semi-annual yield on the Treasury Constant Maturity Series with maturity equal to the remaining weighted average life of the Loan for the week prior to the Prepayment Date, as reported in Federal Reserve Statistical Release H.15 - Selected Interest Rates, conclusively (without manifest error) determined by Holder on the Prepayment Date. The rate will be determined by linear interpolation between the yields reported in Release H.15, if necessary. In the event Release H.15 is no longer published, Holder shall select a comparable publication to determine the Treasury Rate. 2. Payments. 2.1 Principal and interest hereunder shall be payable by Borrower to Holder as follows: (i) Interest only, in arrears, from the date of the Note through the 10th day of January, 1994 payable on the 10th day of January, 1994; said payment being an adjusted payment; (ii) Monthly installments of interest only, in arrears, in the amount of Two Hundred Seventy-Three Thousand Five Hundred Twenty and 83/100ths Dollars ($273,520.83) each shall be due and paid commencing the 10th day of February, 1994 and continuing on the 10th day of each succeeding consecutive month thereafter through and including the ____ day of December, 1996; (iii) Monthly installments of principal and interest in the amount of Three Hundred Thirteen Thousand One Hundred Fifty-Two and 84/100ths Dollars ($313,152.84) each shall be due and paid commencing the 10th day of January 1997 and continuing on the 10th day of each succeeding consecutive month thereafter until the Maturity Date; and (iv) In any event, the entire unpaid balance of principal and accrued interest shall be due and payable on the Maturity Date. For any partial month, interest payments due under this Note shall be computed by dividing the actual number of days the Loan is outstanding by three hundred and sixty-five (365) days multiplied by the Principal Balance multiplied by the Interest Rate or Secondary Interest Rate, as the case may be. 2.2 Until directed otherwise in writing by Holder, all payments of principal, interest, and Prepayment Premium, if any, made under this Note shall be made by electronic funds transfer from a bank account established and maintained by Borrower for this purpose. Borrower covenants and agrees to so establish and maintain such an account with a depository satisfactory to Holder in Holder's reasonable discretion, and to direct the depository in writing to transfer such payments on their respective due dates to the account of Holder maintained at such depository as Holder and Borrower shall designate. Holder shall have the right, after thirty (30) days written notice to Borrower, to require Borrower to use a different depository or to select a different depository for Holder's account, if applicable as reasonably approved by Borrower. All costs of establishing and maintaining such accounts and all costs of such electronic funds transfers shall be paid by Borrower. Prior to each payment due date, Borrower shall deposit and/or maintain sufficient funds in Borrower's account to cover each debit entry. 2.3 THIS LOAN IS PAYABLE IN FULL ON THE ____ DAY OF DECEMBER, 2003. ON SAID MATURITY DATE YOU MUST REPAY THE ENTIRE PRINCIPAL BALANCE OF THE LOAN AND UNPAID INTEREST THEN DUE. THE PAYEE IS UNDER NO OBLIGATION TO RENEW, EXTEND OR REFINANCE THE LOAN AT THAT TIME. YOU WILL THEREFORE BE REQUIRED TO MAKE PAYMENT OUT OF THE COLLATERAL AND OTHER ASSETS YOU OWN ON THE MATURITY DATE UNLESS YOU FIND ANOTHER LENDER WHICH FUNDS AN AMOUNT SUFFICIENT TO ALLOW YOU TO PAY OFF THIS LOAN ON THE MATURITY DATE. 2.4If the date for any payment hereunder falls on a day which is not a Business Day, then for all purposes hereof the same shall be deemed to have fallen on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of interest hereunder. 3. Treatment of Payments. All payments due under this Note shall be made without setoff, counterclaim, or deduction. Payments from Borrower to Holder under this Note shall be applied first to any expense reimbursements provided for under the Loan Documents as constituting additional indebtedness of Borrower to Holder, then to any accrued and unpaid Late Charges under this Note, then to accrued and unpaid interest under this Note and the balance to the Principal Balance and any Prepayment Premium due thereon. 4. Late Charges. 4.1 If any monthly interest payment or monthly principal and interest payment is not paid in full on or before the Monthly Due Date for such payment, then a Per Diem Late Charge shall be assessed for each day that such payment is not paid from (and including) the first day after such Monthly Due Date to (and including) the date upon which such payment is made; provided, however, that if any such monthly interest payment or monthly principal and interest payment, together with all accrued Per Diem Late Charges, is not paid in full on or before the fifteenth day immediately following such Monthly Due Date for such payment, the Monthly Late Charge shall be deemed to be immediately assessed and shall be immediately due and payable as to such payment. The Monthly Late Charge shall be payable in lieu of and not in addition to any Per Diem Late Charges that shall have accrued during the two-week period immediately preceding the assessment of the Monthly Late Charge. Borrower acknowledges and agrees that its failure to make timely payments will result in Holder incurring additional expense in servicing the Loan, and that it is extremely difficult and impractical to ascertain the extent of such damages, and that the Per Diem Late Charge and Monthly Late Charge represent a fair and reasonable estimate, considering all of the circumstances existing on the date of the execution of this Note, of the costs that Holder will incur by reason of any such late payments. Acceptance of any Per Diem Late Charge and Monthly Late Charge shall not constitute a waiver of the default with respect to the late payment, and shall not prevent Holder from exercising any of the other rights or remedies available hereunder or at law or in equity. 4.2The foregoing Per Diem Late Charge and Monthly Late Charge obligations shall not be assessed or imposed, and payments due under this Note shall not be deemed delinquent due to delays attributable to acts or causes directly related to the Electronic Fund Transfer System and beyond the control of Borrower. 5. Event of Default and Secondary Interest. 5.1 The occurrence of an "Event of Default" under any Loan Document shall constitute an Event of Default under this Note. Upon the occurrence of an Event of Default, Holder, at its option, may declare the Principal Balance together with all unpaid accrued interest, any Prepayment Premium and any other accrued and unpaid sums evidenced or secured by this Note or any Loan Document, to be immediately due and payable, without further presentment, demand, protest or notice of any kind, by so notifying Borrower in writing ("Acceleration Notice"). 5.2 Borrower agrees that from and after the delivery of an Acceleration Notice pursuant to Paragraph 5.1 of this Note, interest shall accrue on the Indebtedness at the Secondary Interest Rate. 6. Prepayment. 6.1 Subject to payment of the premium referred to below (unless any term or provision of a Loan Document expressly provides otherwise) and all accrued interest and other sums due under the Loan, if any, Borrower shall have the right to prepay all or part of the outstanding principal balance of the Loan on any date, upon giving not less than thirty (30) days prior written notice to Holder of its intention to prepay. 6.2 Except as to prepayments within ninety (90) days prior to the maturity of the Loan while there is no default by Borrower under the Loan Documents which has not been cured during any applicable grace, notice and cure periods prior to an acceleration by Holder (in which case the Prepayment Premium shall not be applicable), if the Loan is prepaid for any reason, whether voluntarily or involuntarily, or after acceleration by Holder upon a default by Borrower under the Loan Documents which has not been cured during any applicable grace, notice and cure periods, Borrower shall pay a prepayment premium ("Prepayment Premium") equal to the greater of (1) or (2) where: (1) is the product of (a) 1% of the principal amount of the Loan being prepaid multiplied by (b) the quotient of (i) the number of full months remaining to maturity of the Loan as of the Prepayment Date divided by (ii) the number of full months comprising the term of the Loan; and, (2) is an amount equal to the Present Value of the Loan less the amount of principal being prepaid including accrued interest, if any, calculated as of the Prepayment Date. Holder shall notify Borrower of the amount and basis of determination of the Prepayment Premium. On or before the Prepayment Date, Borrower shall pay to Holder the Prepayment Premium together with the amount of the principal being prepaid and all accrued interest and other sums due under the Loan. Holder shall not be obligated to accept any prepayment of the principal balance of the Loan unless such prepayment is accompanied by the Prepayment Premium and all accrued interest and other sums due under the Loan. 7. Security. This Note is secured, among other security, by the Security Instrument and the other Loan Documents, which contain provisions for the acceleration of the maturity of this Note upon the occurrence of certain described events. 8. Holder's Rights; No Waiver by Holder. The rights, powers and remedies of Holder under this Note shall be in addition to all rights, powers and remedies given to Holder under the Loan Documents and any other agreement or document securing or evidencing the Indebtedness or by virtue of any statute or rule of law, including, but not limited to, the Florida Uniform Commercial Code. All such rights, powers and remedies shall be cumulative and may be exercised successively or concurrently in Holder's sole discretion without impairing Holder's security interest, rights or available remedies. Subject to the provisions of Paragraph 9.34 of the Security Instrument, any forbearance, failure or delay by Holder in exercising any right, power or remedy shall not preclude further exercise thereof, and every right, power or remedy of Holder shall continue in full force and effect until such right, power or remedy is specifically waived in a writing executed by Holder. Borrower waives any right to require the Holder to proceed against any person or to exhaust any Property or to pursue any remedy in Holder's power. 9. Borrower's Waivers. 9.1 Except as expressly provided for in the Loan Documents, Borrower and any endorsers of this Note, and each of them, hereby waive diligence, demand, presentment for payment, notice of non-payment, protest and notice of protest, and specifically consent to and waive notice of any renewals or extensions of this Note, whether made to or in favor of Borrower or any other person or persons. Borrower and any endorsers of this Note expressly waive all right to the benefit of any statute of limitations and any moratorium, reinstatement, marshalling, forbearance, extension, redemption, or appraisement now or hereafter provided by the Constitution and the laws of the United States and of any state thereof, as a defense to any demand against Borrower or any such endorsers, to the fullest extent permitted by law. 9.2 WAIVER OF TRIAL BY JURY. BORROWER HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM FILED BY BORROWER OR HOLDER, WHETHER IN CONTRACT, TORT OR OTHERWISE, RELATING DIRECTLY OR INDIRECTLY TO THIS NOTE, THE LOAN, THE LOAN DOCUMENTS OR ANY ACTS OR OMISSIONS OF LENDER IN CONNECTION THEREWITH. 10. Transfers by Holder. This Note or any interest in this Note and the Loan Documents may be hypothecated, transferred or assigned by Holder without the prior consent of Borrower; provided, however, that Holder upon the written request of Borrower made not more frequently than once during any calendar year shall disclose to Borrower the identity of all participants in the Loan and all assignees of the Loan. 11. Amendment. This Note may be amended or modified only by an instrument in writing which by its express terms refers to this Note and which is duly executed by the party sought to be bound thereby. 12. Successors and Assigns. This Note shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, personal representatives, successors and permitted assigns. 13. Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of Florida. 14. Time. Time is of the essence with respect to each and every term and provision of this Note. 15. No Usury. Under no circumstances shall the aggregate amount paid or agreed to be paid hereunder exceed the highest lawful rate permitted under applicable usury law (the "Maximum Rate") and the payment obligations of Borrower under this Note are hereby limited accordingly. If under any circumstances, whether by reason of advancement or acceleration of the unpaid principal balance hereof or otherwise, the aggregate amounts paid on this Note shall include amounts which by law are deemed interest and which would exceed the Maximum Rate, Borrower stipulates that payment and collection of such excess amounts shall have been and will be deemed to have been the result of a mistake on the part of both Borrower and Holder, and the party receiving such excess payments shall promptly credit such excess (to the extent only of such interest payments in excess of the Maximum Rate) against the unpaid principal balance hereof (without payment of any prepayment penalty) and any portion of such excess payments not capable of being so credited shall be refunded to Borrower. 16. Notices. All notices, consents and other communications required or permitted by this Note shall be in writing and shall be given in the manner set forth in the Security Instrument. 17. Attorneys' Fees. The undersigned agrees to pay all costs, including reasonable attorneys' fee and expenses, incurred by Holder in enforcing payment or collection of this Note or the terms of any Loan Document in accordance with the terms and provisions of the Loan Documents (as reasonably construed by Holder), whether or not suit is filed. 18. Limitation on Personal Liability. Holder agrees, subject to the specific exceptions set forth below and not as to any Loan Document which expressly states it is not subject, in whole or in part, to this Limitation on Personal Liability provision (including, but not by way of limitation, the Hazardous Substances Remediation and Indemnification Agreement of even date herewith between Borrower, the Other Loan Parties and Lender and the Other Loan Party Agreement of even date herewith between the other Loan Parties and Lender), to the extent the provisions of any such Loan Document expressly provides that all or any part of this paragraph is not applicable to any such document, that in enforcing any obligations under the Loan Documents its sole recourse shall be limited to the collateral for the Loan and it will look solely and only to such collateral in enforcing any such obligations. Further, subject to the specific exceptions set forth below and excluding any Loan Document which expressly states that it is not subject to this Limitation on Personal Liability provision to the extent the provisions of any such Loan Document expressly provides that all or any part of this paragraph is not applicable to any such document, neither Borrower, its partners nor any other Loan Party ("Exculpated Parties") shall have any personal liability under the Loan Documents, except that Borrower, its general partners (but not the partners of such parties unless they area also Other Loan Parties and/or any negative capital accounts of any partners not created for the purpose of evading liability hereunder), and the Other Loan Parties (but not the partners of such parties unless they are also Other Loan Parties and/or any negative capital accounts of any partners not created for the purpose of evading liability hereunder) shall be jointly and severally liable for the payment of taxes, assessments and utility charges with respect to the Real Estate Security or any part thereof which become due and payable prior to the earlier to occur of (x) the Holder taking possession of the Real Estate Security, the appointment of a receiver for the Real Estate Security or (z) the issuance of a certificate of title pursuant to a foreclosure sale of the Real Estate Security or upon Holder's acceptance of, in its sole discretion without regard to the Standard of Conduct, a deed-in-lieu of foreclosure and such joint and several liability as provided for under the ERISA paragraphs of the Security Instrument including the indemnification provisions thereof and for the Indemnity Obligations under and as defined in the Hazardous Substances Remediation and Indemnification Agreement of even date herewith between Borrower, the Other Loan Parties and Lender and for the obligations of the Other Loan Parties under the Other Loan Party Agreement of even date herewith by and between the Other Loan Parties and Lender. Without limitation on the foregoing and notwithstanding anything to the contrary herein, in no event shall any of the partners, officers, directors, employees, or shareholders of the Exculpated Parties have any personal liability under the Loan Documents (unless they are either an entity which is a general partner of Borrower or an entity which is an Other Loan Party) and any negative capital account of any partners not created for the purpose of evading liability hereunder, shall not be available as collateral to the Holder. Moreover, after written notice from Holder to the Exculpated Parties, the agreement not to pursue recourse liability SHALL BECOME NULL AND VOID and of no further force and effect as to Borrower, its general partners and the Other Loan Parties (but not the officers, directors, employees or shareholders of Borrower's general partners and of the Other Loan Parties, any partners of Borrower's general partners unless they are also Other Loan Parties and any partners of the Other Loan Parties unless they are also Other Loan Parties nor any negative capital account of any partner not created for the purpose of evading any liability hereunder) in the event: (a) of actionable fraud or intentional material misrepresentation in connection with the Loan not cured within thirty (30) days after written notice of the same from Holder to Borrower (but not in addition to any cure period applicable to any written notice of default by Holder to Borrower given under the Loan Documents based on such occurrences); or (b) of the misapplication of (i) proceeds paid under any insurance policies by reason of damage, loss or destruction affecting any portion of the collateral for the Loan (to the full extent of such proceeds that were misapplied) not cured within thirty (30) days after written notice of the same from Holder to Borrower (but not in addition to any cure period applicable to any written notice of default by Holder to Borrower given under the Loan Documents based on such occurrences) (ii) any proceeds or awards resulting from the condemnation of all or any part of the collateral for the Loan (to the full extent of such proceeds or awards that were misapplied) not cured within thirty (30) days after written notice of the same from Holder to Borrower (but not in addition to any cure period applicable to any written notice of default by Holder to Borrower given under the Loan Documents based on such occurrences) or (iii) rents received after receipt by Borrower of any notice to which Borrower may be entitled, if any, of default or of foreclosure or of exercise of other remedies by Holder upon a default by Borrower; or (c) of any tenant security deposits not turned over to Holder upon foreclosure or sale pursuant to power of sale if, at such time, there is a legal duty to return said tenant security deposit to the depositing tenant, now or in the future, under the provisions of any such tenant's lease or under Florida law; or (d) of any intentional waste of any part of the collateral for the Loan not cured within thirty (30) days after written notice of the same from Holder to Borrower (but not in addition to any cure period applicable to any written notice of default by Holder to Borrower given under the Loan Documents based on such occurrences). The recourse liability resulting from (b), (c) and (d) above shall apply only to the extent of the lesser of (x) the amount involved in (b), (c), and (d) above, as applicable, and (y) the amount (the "Deficiency Amount"), if any, by which the sums owed under the Loan Documents exceed the fair market value of the collateral for the loan at the time of any foreclosure sale or deed in lieu of foreclosure as to said collateral. The foregoing provisions shall not limit or diminish Holder's other rights and remedies with respect to the collateral for the loan under any provisions of the Loan Documents or at law and in equity, including, without limitation, the right to foreclose, nor shall such provisions limit or diminish Holder's rights and remedies under any provisions of the Loan Documents in seeking personal liability therefor as to any of the above specific exceptions to the Limitation on Personal Liability provisions or as to any Loan Document which expressly states it is not subject to the above Limitation on Personal Liability provisions. Notwithstanding any term or provision contained herein or in the Loan Documents, the liability hereunder of Urban Shopping Centers, L.P., a Maryland limited partnership, JMB Income Properties, Ltd.-XIII, an Illinois limited partnership, and IDS/JMB Balanced Income Growth, Ltd., an Illinois limited partnership (collectively the "JMB Loan Parties") and each of them, jointly and severally among each other, shall not exceed fifty percent (50%) ("JMB Cap") of the total recourse dollar amount Holder would, but for the JMB Cap and DeBartolo Cap, be entitled to recover from all of the Other Loan Parties including the JMB Loan Parties plus interest on said amount at the Secondary Interest Rate, and reasonable out-of-pocket costs of enforcement and reasonable attorneys fees in recovering the same less any amounts realized by Holder from Borrower, all of the Other Loan Parties and the collateral for the Loan (but not from the DeBartolo Loan Parties) in excess of the total nonrecourse dollar amount owed to Holder with no obligation to proceed against any of them. In no event however, should Holder collect more than one hundred percent (100%) of the sums due hereunder. The liability of DeBartolo, Inc., DeBartolo Realty Corporation, an Ohio corporation, and DeBartolo Realty Partnership, L.P., a Delaware limited partnership (collectively the "DeBartolo Loan Parties") and each of them, jointly and severally among each other, shall not exceed fifty percent (50%) ("DeBartolo Cap") of the total recourse dollar amount Holder would, but for the DeBartolo Cap and JMB Cap, be entitled to recover from all of the Other Loan Parties including the DeBartolo Loan Parties plus interest on said amount at the Secondary Interest Rate and reasonable out-of-pocket costs of enforcement and reasonable attorneys fees in recovering the same less any amounts realized by Holder from Borrower, all of the Other Loan Parties and the collateral for the Loan (but not from the JMB Loan Parties) in excess of the total nonrecourse dollar amount owed to Holder with no obligation to proceed against any of them. In no event however, should Holder collect more than one hundred percent (100%) of the sums due hereunder. The JMB Cap and DeBartolo Cap shall not cause or create any obligation of Holder to collect all or any portion of the sums due hereunder or to enforce any obligation of Borrower, the JMB Loan Parties or the DeBartolo Loan Parties hereunder or of Borrower under the Loan Documents or to exercise any of Holder's rights or remedies as to the collateral for the Loan. The liability of the JMB Loan Parties, the DeBartolo Loan Parties and Borrower are primary and absolute obligations of each subject to the JMB Cap, in the case of the JMB Loan Parties, and the DeBartolo Cap, in the case of the DeBartolo Loan Parties. After a transfer pursuant to the provisions of Paragraph 4.2.E of the Security Instrument, the JMB Cap and DeBartolo Cap will no longer be applicable to the transferee pursuant to the provisions of Paragraph 4.2.E of the Security Instrument (transfers between JMB and DeBartolo Affiliates). Further, the Borrower and Other Loan Parties may qualify for a release from their recourse obligations under the Loan Documents under certain circumstances and subject to the requirements of Paragraph 4.2.B.(3) of the Security Instrument and the certain transferring Other Loan Parties and/or affiliates of the transferring Other Loan Parties may qualify for a release from their recourse obligations under the Loan Documents under certain circumstances and subject to the requirements of Paragraph 4.2.K of the Security Instrument. 19. Incorporation by Reference. The provisions of (i) Paragraph 9.34 of the Security Instrument governing the standard of conduct of Holder, (ii) Paragraph 6.1.D of the Security Instrument relating to Default Waivers, (iii) Paragraph 9.1 of the Security Instrument relating to the term "Debtor" are hereby incorporated herein by reference and shall be applicable to this instrument with "Debtor" therein to mean "Borrower" herein and "Secured Party" therein to mean "Holder" herein. EXECUTION AND NOTARIZATION PAGES FOLLOW WEST DADE COUNTY ASSOCIATES, a Florida general partnership By: JMB/Miami International Associates, an Illinois general partnership as general partner of West Dade County Associates By: JMB Income Properties, Ltd.- XIII, an Illinois limited partnership as general partner of JMB/Miami International Associates By: JMB Realty Corporation, a Delaware corporation as Managing General Partner of JMB Income Properties, Ltd.-XIII By:_______________________ (signed name) __________________________ (printed name) Its:_____________________ (title) [CORPORATE SEAL] By: Urban Shopping Centers, L.P., an Illinois limited partnership as general partner of JMB/Miami International Associates By: Urban Shopping Centers, Inc., a Maryland corporation as general partner of Urban Shopping Centers, L. P. By: ______________________ (signed name) __________________________ (printed name) Its:_____________________ (title) [CORPORATE SEAL] By: IDS/JMB Balanced Income Growth, Ltd., an Illinois limited partnership as general partner of JMB/Miami International Associates By: Income Growth Managers, Inc., an Illinois corporation as general partner of IDS/JMB Balanced Income Growth, Ltd. By:________________________ (signed name) ___________________________ (printed name) Its:_______________________ (title) [CORPORATE SEAL] By: DeBartolo-Miami Associates, an Ohio general partnership as general partner of West Dade County Associates By:________________________________ Edward J. DeBartolo, general partner of DeBartolo-Miami Associates By: DeBartolo Realty Partnership, L.P., a Delaware limited partnership as general partner of DeBartolo-Miami Associates By: Coral Square Associates, an Ohio general partnership, as general partner of DeBartolo Realty Partnership, L.P. By:_________________________ (Signed name) _________________________ (Printed name) Its:________________________ (Title) By: The Edward J. DeBartolo Corporation, an Ohio corporation, as a general partner of DeBartolo Realty Partnership, L.P. By:________________________ (Signed name) ________________________ (Printed name) Its:_______________________ (Title) [Corporate seal] By: M-I Mall, Inc., a Florida corporation as general partner of West Dade County Associates By:______________________________ (signed name) _____________________________ (printed name) Its:___________________________ (title) (CORPORATE SEAL] By: DeBartolo Realty Partnership, L.P., a Delaware limited partnership as general partner of West Dade County Associates By: Coral Square Associates, an Ohio general partnership, as a general partner of DeBartolo Realty Partnership, L.P. By:________________________ (Signed name) ________________________ (Printed name) Its:________________________ (Title) By: The Edward J. DeBartolo Corporation, an Ohio corporation, as a general partner of DeBartolo Realty Partnership, L.P. By:________________________ (Signed name) ________________________ (Printed name) Its:_______________________ (Title) [Corporate seal] STATE OF _________________________ ) ) s.s. COUNTY OF ________________________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ____________________ the _______________________ of JMB Realty Corporation, a Delaware corporation, as general partner and on behalf of JMB Income Properties, Ltd.-XIII, an Illinois limited partnership acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he/she/they executed the foregoing instrument on behalf of JMB Realty Corporation, acting as general partner and on behalf of JMB Income Properties, Ltd.-XIII acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ____________, 1993. _____________________________ Signature of Notary Public _____________________________ Printed Name of Notary Public My Commission expires: ____________________________ [Notary Seal] STATE OF _________________________ ) ) s.s. COUNTY OF ________________________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ____________________ the _______________________ of Urban Shopping Centers, Inc., a Maryland corporation, as general partner and on behalf of Urban Shopping Centers, L.P., an Illinois limited partnership acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he/she/they executed the foregoing instrument on behalf of Urban Shopping Centers, Inc. acting as general partner and on behalf of Urban Shopping Centers, L.P., acting as general partner and on behalf of JMB/Miami International Associates acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ____________, 1993. _____________________________ Signature of Notary Public _____________________________ Printed Name of Notary Public My Commission expires: ____________________________ [Notary Seal] STATE OF _________________________ ) ) s.s. COUNTY OF ________________________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ____________________ the _______________________ of Income Growth Managers, Inc., an Illinois corporation, as general partner and on behalf of IDS/JMB Balanced Growth, Ltd., an Illinois limited partnership acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he/she/they executed the foregoing instrument on behalf of Income Growth Managers, Inc. acting as general partner and on behalf of IDS/JMB Balanced Growth, Ltd. acting as general partner and on behalf of JMB/Miami International Associates acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ____________, 1993. _____________________________ Signature of Notary Public _____________________________ Printed Name of Notary Public My Commission expires: ____________________________ [Notary Seal] STATE OF _________________________ ) ) s.s. COUNTY OF ________________________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared EDWARD J. DeBARTOLO as general partner and on behalf of DeBartolo-Miami Associates, an Ohio general partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he executed the foregoing instrument as general partner and on behalf of DeBartolo-Miami Associates as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ____________, 1993. _____________________________ Signature of Notary Public _____________________________ Printed Name of Notary Public My Commission expires: ____________________________ [Notary Seal] STATE OF _________________________ ) ) s.s. COUNTY OF ________________________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ____________________ as general partner of Coral Square Associates, an Ohio general partnership acting as a general partner and on behalf of DeBartolo Realty Partnership L.P., a Delaware limited partnership, as general partner and on behalf of DeBartolo-Miami Associates, an Ohio general partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he executed the foregoing instrument on behalf of Coral Square Associates acting as general partner and on behalf of DeBartolo Realty Partnership, L.P. acting as general partner and on behalf of DeBartolo-Miami Associates acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ____________, 1993. _____________________________ Signature of Notary Public _____________________________ Printed Name of Notary Public My Commission expires: ____________________________ [Notary Seal] STATE OF _________________________ ) ) s.s. COUNTY OF ________________________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ____________________ the _______________ of The Edward J. DeBartolo Corporation, an Ohio corporation acting as a general partner and on behalf of DeBartolo Realty Partnership L.P., a Delaware limited partnership, as general partner and on behalf of DeBartolo-Miami Associates, an Ohio general partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he executed the foregoing instrument on behalf of The Edward J. DeBartolo Corporation acting as general partner and on behalf of DeBartolo Realty Partnership, L.P. acting as general partner and on behalf of DeBartolo-Miami Associates acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ____________, 1993. _____________________________ Signature of Notary Public _____________________________ Printed Name of Notary Public My Commission expires: ____________________________ [Notary Seal] STATE OF _________________________ ) ) s.s. COUNTY OF ________________________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ____________________ the _______________ of M-I Mall, Inc., a Florida corporation, acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he/she/they executed the foregoing instrument as general partner and on behalf of M-I Mall, Inc. acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ____________, 1993. _____________________________ Signature of Notary Public _____________________________ Printed Name of Notary Public My Commission expires: ____________________________ [Notary Seal] STATE OF _________________________ ) ) s.s. COUNTY OF ________________________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ____________________, a general partner of Coral Square Associates, an Ohio general partnership, acting as general partner of and on behalf of DeBartolo Realty Partnership, L.P., a Delaware limited partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership, and acknowledged that he executed the foregoing instrument on behalf of Coral Square Associates, acting as general partner of and on behalf of DeBartolo Realty Partnership, L.P., acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ____________, 1993. _____________________________ Signature of Notary Public _____________________________ Printed Name of Notary Public My Commission expires: ____________________________ [Notary Seal] STATE OF _________________________ ) ) s.s. COUNTY OF ________________________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ____________________, the _____________ of The Edward J. DeBartolo Corporation, an Ohio corporation, acting as general partner of and on behalf of DeBartolo Realty Partnership, L.P., a Delaware limited partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership, and acknowledged that he executed the foregoing instrument on behalf of The Edward J. DeBartolo Corporation, acting as general partner of and on behalf of DeBartolo Realty Partnership, L.P., acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ____________, 1993. _____________________________ Signature of Notary Public _____________________________ Printed Name of Notary Public My Commission expires: ____________________________ [Notary Seal] No Florida Documentary Stamps are due hereon as such stamps have been affixed to the Modification, Renewal and Restatement of Mortgage and Security Agreement securing this Note and said stamps have been duly cancelled with the balance of such stamps being placed on the documents modified by said instrument as recited thereon, which recitation is incorporated herein by this reference thereto. EX-99 5 EXHIBIT TO 10K LOAN NUMBER 6 100 405 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: Robert A. Savill, P.A. Shutts & Bowen 20 North Orange Avenue, Suite 1000 Orlando, Florida 32801 SPACE ABOVE THIS LINE FOR RECORDER'S USE _________________________________________________________________ MODIFICATION, RENEWAL AND RESTATEMENT OF MORTGAGE AND SECURITY AGREEMENT [ALL FLORIDA DOCUMENTARY STAMP TAXES AND FLORIDA INTANGIBLES TAXES WERE PAID ON $45,200,000.00 OF THE ORIGINAL PRINCIPAL AMOUNT OF THE INSTRUMENTS MODIFIED, RENEWED AND RESTATED HEREIN AND OTHER THAN $9,500.05 OF FLORIDA DOCUMENTARY STAMP TAXES AND $5,428.58 OF FLORIDA INTANGIBLES TAXES DUE ON THE $2,714,289.61 FUTURE ADVANCE NOTE FROM DEBTOR TO SECURED PARTY OF EVEN DATE HEREWITH, NO ADDITIONAL FLORIDA DOCUMENTARY STAMP TAXES ARE DUE HEREON PURSUANT TO SECTION 201.09, FLORIDA STATUTES, AND NO ADDITIONAL FLORIDA INTANGIBLES TAXES ARE DUE HEREON PURSUANT TO SECTION 199.145, FLORIDA STATUTES. THE PRINCIPAL BALANCE OF THE INDEBTEDNESS SECURED HEREBY IS $47,500,000.00 AND THE PRINCIPAL BALANCE SECURED BY THE INSTRUMENTS MODIFIED, RENEWED AND RESTATED HEREIN IS $44,785,710.39. THE PARTNERSHIP AGREEMENT OF THE DEBTOR PROVIDES THAT THE PARTNERSHIP CONTINUES ON THE WITHDRAWAL AND/OR ADDITION OF ANY GENERAL PARTNER] THIS MODIFICATION, RENEWAL AND RESTATEMENT OF MORTGAGE AND SECURITY AGREEMENT is made this _____ day of December, 1993, to be effective as of and from the _____ day of December, 1993, by WEST DADE COUNTY ASSOCIATES, a Florida general partnership having offices in care of The Edward J. DeBartolo Corporation, 7620 Market Street, Youngstown, Ohio 44513-6085 ("Debtor") , unto THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, a New Jersey corporation, having offices at One Ravinia Drive, Suite 1400, Atlanta, Georgia 30346 ("Secured Party") pursuant to an Agreement of Consolidation, Modification, Renewal and Restatement by and between Debtor and Secured Party of even date herewith. RECITALS: A. Secured Party is now the owner and holder of the Mortgage Note dated January 27, 1981 from Debtor to Mellon Bank, N.A. ("Mellon") in the face amount of THIRTY-EIGHT MILLION AND NO/100THS DOLLARS ($38,000,000.00), the Mortgage Note dated November 29, 1982 from Debtor to Mellon in the face amount of FIVE MILLION EIGHT HUNDRED THOUSAND AND NO/100THS DOLLARS ($5,800,000.00), the Note Extension Agreement dated January 27, 1984 by and between Debtor and Mellon extending the term of the aforedescribed two Notes, the Mortgage Note dated March 28, 1985 from Debtor to Teachers Insurance and Annuity Association of America ("Teachers") in the face amount of SEVEN MILLION SIX HUNDRED TWENTY-TWO THOUSAND NINE HUNDRED THIRTY-EIGHT AND 11/100THS DOLLARS ($7,622,938.11), and the Consolidating Note Agreement dated March 28, 1985 between Debtor and Teachers; all of which, on even date herewith, were assigned from Teachers to Secured Party (collectively referred to as the "Prior Note"). B. Secured Party is now the owner and holder of a certain Mortgage and Security Agreement executed by Debtor to Mellon dated January 27, 1981 and recorded on January 30, 1981 in the Official Records Book 11001, Page 1488, Public Records of Dade County, Florida, and a Supplement to Mortgage and Security Agreement by and between Debtor and Mellon dated November 29, 1982 and recorded December 2, 1982 in the Official Records Book 11629, Page 2341, Public Records of Dade County, Florida, all of the foregoing having been assigned by Mellon to Teachers by an Assignment of Mortgage and Security Agreement from Mellon to Teachers dated March 22, 1985, and recorded March 29, 1985 in the Official Records Book 12460, Page 3210, Public Records of Dade County, Florida, an instrument of assignment from Mellon to Teachers dated March 22, 1985, and recorded March 29, 1985 in the Official Records Book 12460, Page 3213, Public Records of Dade County, Florida, the Mortgage Deed from Debtor to Teachers dated March 28, 1985 and recorded March 29, 1985 in the Official Records Book 12460, Page 3307, Public Records of Dade County, Florida, a Consolidation, Modification and Extension Agreement by and between Debtor and Teachers dated March 28, 1985 and recorded March 29, 1985 in the Official Records Book 12460, Page 3257, Public Records of Dade County, Florida, and a Partial Release, Spreader and Modification Agreement by and between Debtor and Teachers dated October 1, 1991 and recorded October 22, 1991 in the Official Records Book 15238, Page 2329, Public Records of Dade County, Florida; all of which on even date herewith, was assigned from Teachers to Secured Party (collectively, the "Prior Security Instrument"). C. Pursuant to an Agreement of Consolidation, Modification, Renewal and Restatement of Note and Mortgage and Security Agreement between Debtor and Secured Party of even date herewith, Debtor has agreed to execute and deliver and Secured Party has agreed to accept (i) a Future Advance Note in the amount of $2,714,289.61 from Debtor to Secured Party of even date herewith; (ii) a certain Consolidated, Modified, Renewed and Restated Promissory Note in the principal amount of $47,500,000.00 executed by Debtor in favor of Secured Party of even date herewith which consolidates, modifies, renews and restates said Future Advance Note and the Prior Note; and (iii) this Modification, Renewal and Restatement of Mortgage and Security Agreement. NOW, THEREFORE, for and in consideration of the sum of Ten and no/100 Dollars and other good and valuable consideration, the receipt of which is hereby acknowledged, the Prior Security Instrument is hereby modified, renewed and restated in its entirety to read as follows: [CONTINUED ON NEXT PAGE] TABLE OF CONTENTS ARTICLE 1 Definitions 3 Certain Defined Terms 3 Acceleration Notice 3 Adjusted Net Proceeds 3 Affiliate 3 Agreement of Consolidation, Modification, Renewal and Restatement 3 Allied Building 4 Allied Site 4 Allied Stores 4 Alstores 4 Anchor Store 4 Anchor Stores 4 Applicable Financial Reporting Requirements 4 Application 4 Approved Manager 4 Approved Manager Business Practices 5 Architect 5 Assignment of Agreements 5 Assignment of Leases 5 Associated 5 Associated Building 5 Associated Site 6 Burdines 6 Business Day 6 Certified Rent Roll 6 Closing Date 6 Code 6 Collateral 6 Collection Expenses 6 COREA 6 COREA Signatories 7 CPA 7 DeBartolo 7 DRC 7 DRPLP 7 DeBartolo Affiliates 7 DeBartolo Debtor General Partners 7 DeBartolo Cap 7 DeBartolo Family Affiliates 7 DeBartolo OPREIT 7 Default Waiver 7 Deficiency Amount 7 Department Stores 7 Equipment and Vehicles 7 Essential Affiliates 7 Event of Default 7 Excluded Equipment and Vehicles 8 Exculpated Parties 8 Expenses 8 Federated 8 Federated Building 8 Federated Site 8 Final Plans and Specifications 8 Fixtures 8 Future Advance Note 8 General Partner Constituent of Debtor 8 General Partner Constituents of the JMB Primary Partnerships 8 Good Faith Efforts 9 Grace Period 9 Gross Revenues 9 Hazardous Substances Remediation and Indemnification Agreement 9 Impositions 9 Impound Account 9 Improvements 9 Indebtedness 9 Institutional 10 Institutional Secured Party 10 Inventory 10 JMB Affiliate 10 JMB Cap 10 JMB Controlled Affiliate 10 JMB Loan Parties 10 JMB Primary Partnerships 10 Jordan Marsh 10 Key Tenant 10 Key Tenant Lease 10 Land 10 Land Use Certification 10 Laws and Restrictions 10 Leased Assets 11 Leases 11 Loan 11 Loan Documents 11 Lord & Taylor 11 Maas 11 Management Agreement 11 Mervyn's 11 Mervyn's Site 11 Mortgaged Premises 11 Net Operating Income 11 Net Proceeds 11 Note 11 Obligations 12 Occurrence 12 One Time Transfer Conditions 12 OPREIT 12 Other Loan Parties 12 Other Loan Party Agreement 12 Penney 12 Penney Building 12 Penney Site 12 Permitted Exceptions 12 Person 12 Personalty 13 Potential Default 13 Preliminary Plans and Specifications 13 Prepayment Premium 13 Proceeding 13 Property 13 Prospective Release 13 Qualified or Qualified Buyer 13 Real Estate Security 13 Realty 13 Receiver 13 Rents 13 Required Periods 13 Risk of Forfeiture 13 Sears 14 Sears Building 14 Sears Site 14 Secondary Interest Rate 14 Security 14 Standard of Conduct 14 Subsequent Owner 14 Temporary Leases 14 Tenant 14 Tenant Fixtures and Improvements 14 Third Party Transferee 14 Trademarks 14 Transfer 15 USCINC 15 USCLP 15 ARTICLE 2 Representations and Warranties 15 2.1Warranty of Title and Authorization 15 2.2Organization and Authority 16 2.3Validity of Loan Documents 16 2.4Financial Statements 17 2.5Other Information 17 2.6This section is reserved 18 2.7Other Arrangements 18 2.8Additional Representations and Warranties 18 2.9Compliance with Laws 18 2.10Bankruptcy 18 2.11Taxes 19 2.12FIRPTA Certification 19 ARTICLE 3 Affirmative Covenants 20 3.1Obligations of Debtor 20 3.2Insurance 20 3.3Maintenance, Waste and Repair 22 3.4Impositions; Impounds 23 3.5 Compliance with Law. 24 3.6 Books and Records 25 3.7 Further Assurances 27 3.8 Indemnity and Attorneys' Fees 27 3.9 Litigation 27 3.10Inspection of Property 28 3.11Taxes; Tax Receipts 28 3.12Additional Information 28 3.13Prepayment 29 3.14FIRPTA Affidavit 29 3.15Reimbursement 29 3.16Tax Service Contract 29 3.17Management 29 3.18Plans and Specifications 30 3.19Property Description 30 ARTICLE 4 Negative Covenants 30 4.1Restrictive Uses 30 4.2 Due on Sale or Encumbrance 31 A. General Restrictions 31 B. One Time Transfer of the Entire Mortgaged Premises 32 C. Internal DeBartolo General Partnership Transfers 36 D. Internal JMB General Partnership Transfers 37 E. Transfers between JMB and DeBartolo 38 F. 50% Transfer by JMB or DeBartolo to a Third Party. 39 G. Initial Transfers to the DEBARTOLO REIT. 40 H. JMB Transfers to the JMB OPREIT or DeBartolo OPREIT 41 I. Partnership Interest Pledges to Institutional Secured Parties 41 J. Partner Loans 41 K. Release Rights 42 L. DeBartolo OPREIT General Partner Transfers 43 4.3 Replacement of Fixtures and Personalty 43 4.4 No Cooperative or Condominium 43 4.5 Name of the Mall 44 4.6 Leasing and Agreements 44 4.7 COREA 45 4.8 [Intentionally omitted] 46 ARTICLE 5 Casualties and Condemnation 46 5.1 Insurance and Condemnation Proceeds 46 5.2 Additional Provisions Relating to Condemnation 53 5.3 [Intentionally Omitted] 53 ARTICLE 6 Events of Default and Remedies of Secured Party 53 6.1 Events of Default 53 6.2 Power of Sale 57 6.3 Proof of Default 58 6.4 Protection of Security 59 6.5 Receiver 59 6.6 Remedies Cumulative 59 6.7 Curing of Defaults 60 ARTICLE 7 Security Agreement and Fixture Filing 60 7.1 Grant of Security Interest 60 7.2 Representations, Warranties and Covenants 62 7.3 Remedies 66 7.4 Expenses 66 7.5 Fixture Filing 66 7.6 Fixtures 67 7.7 Waivers 68 ARTICLE 8 Assignment of Rents 69 8.1 Assignment of Rents 69 8.2 Collection of Rents 69 ARTICLE 9 Miscellaneous 70 9.1 Use of the term "Debtor" 70 9.2 Change of Law 70 9.3 No Waiver 70 9.4 Abandonment 70 9.5 Notices 71 9.6 Severability 72 9.7 Joinder of Foreclosure 72 9.8 Governing Law 72 9.9 Subordination 72 9.10Future Advances 73 9.11Right to Accelerate, Waiver of Statute of Limitations and the Right to Redeem 73 9.12Entire Agreement 73 9.13References to Foreclosure 74 9.14Rights of Secured Party 74 9.15Copies 74 9.16No Merger 74 9.17Right of Entry 74 9.18WAIVER OF TRIAL BY JURY 75 9.19Personalty Security Instruments 75 9.20Suits to Protect Property 75 9.21Junior Liens 75 9.22Charges for Servicing Requests 75 9.23Usury 76 9.24Publicity 76 9.25[Intentionally Omitted] 76 9.26ERISA 76 9.27Defense and Indemnity Rights 80 9.28Destruction of Note 80 9.29Successor and Assigns 81 9.30Rules of Construction 81 9.31Assignment of Mortgage and Information to Third Persons 82 9.32Commingling of Funds 82 9.33Limitation on Personal Liability 82 9.34Standard of Conduct 86 9.35Certain Standards on Efforts of Debtor 86 9.36Satisfaction and Cancellation 87 9.37Counterparts 87 LOAN NUMBER 6 100 405 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: Robert A. Savill, P.A. Shutts & Bowen 20 North Orange Avenue, Suite 1000 Orlando, Florida 32801 SPACE ABOVE THIS LINE FOR RECORDER'S USE _________________________________________________________________ MORTGAGE AND SECURITY AGREEMENT THIS MORTGAGE AND SECURITY AGREEMENT (this "Instrument") is made as of the ______ day of December, 1993, by WEST DADE COUNTY ASSOCIATES, a Florida general partnership, having offices in care of The Edward J. DeBartolo Corporation, 7620 Market Street, Youngstown, Ohio 44513-6085 ("Debtor") to THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, a New Jersey corporation, having offices at One Ravinia Drive, Suite 1400, Atlanta, Georgia, 30346 ("Secured Party"). THIS INSTRUMENT CONTAINS AFTER-ACQUIRED PROPERTY PROVISIONS AND SECURES OBLIGATIONS CONTAINING PROVISIONS FOR EXTENSIONS OF TIME FOR PAYMENT AND OTHER MODIFICATIONS IN THE TERMS OF THE OBLIGATIONS. PORTIONS OF THE COLLATERAL ARE GOODS WHICH ARE OR ARE TO BECOME AFFIXED TO OR FIXTURES ON THE LAND DESCRIBED IN EXHIBIT "A" HERETO. THE COLLATERAL SECURES INDEBTEDNESS EVIDENCED BY THE PROMISSORY NOTE SECURED HEREUNDER IN THE ORIGINAL PRINCIPAL AMOUNT OF $47,500,000.00. RECITALS: 1. Debtor by its Note, as defined in Article 1 herein, is indebted to Secured Party in the principal sum of Forty-Seven Million Five Hundred Thousand and no/100 dollars ($47,500,000.00) in lawful money of the United States of America, with interest from the date thereof at the rates set forth in the Note, principal and interest to be payable in accordance with the terms and conditions provided in the Note, the final payment of which, if not sooner paid, is due and payable not later than the _____ day of December, 2003. 2. Debtor desires to secure the payment of and performance of all its Obligations, as defined in Article 1 herein. IN CONSIDERATION of the principal sum of the Note and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, DEBTOR HEREBY IRREVOCABLY GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS, PLEDGES, MORTGAGES, WARRANTS AND CONVEYS TO SECURED PARTY, AND GRANTS SECURED PARTY A SECURITY INTEREST IN, WITH POWER OF SALE, subject to the terms of this Instrument, all of Debtor's right, title and interest now owned or hereafter acquired in and to the following property, together with the Personalty (as hereinafter defined), all of which is hereinafter collectively defined as the "Property": A. That certain real property (the "Land") located in Dade County, State of Florida, and more particularly described in Exhibit "A" attached hereto; B. All Improvements (as hereinafter defined) and all appurtenances, rights and privileges thereof, including all air rights, and development rights, and any land lying in the streets, roads or avenues adjoining the Land or any part thereof; C. All right, title and interest of Debtor in the COREA; D. All easements, rights of way, gores of land, streets, roads, alleys, passages, sewer rights, waters, water courses, water rights and powers, and all, rights, titles, interests, privileges, liberties, tenements, hereditaments and appurtenances whatsoever, in any way belonging, relating or appertaining to the Land or the Improvements, or which hereafter shall in any way belong, relate or be appurtenant thereto, whether now owned or hereafter acquired by Debtor, and the reversion and reversions, remainder and remainders, rents, issues and profits thereof, and all the estate, right,title, interest, property, possession, claim and demand whatsoever,at law as well as in equity, of Debtor in any of the same; E. All Fixtures (as such term is hereinafter defined but excluding Tenant Fixtures and Improvements as hereinafter defined), whether now or hereafter installed, being hereby declared to be for all purposes of this Instrument a part of the Land; F. The rents, issues and profits of or from the Land, the Improvements, the Personalty and the Fixtures, subject, however, to the assignment of rents herein contained; and H. All proceeds of the foregoing, including without limitation, all judgments, awards of damages and settlements hereafter made resulting from condemnation or the taking of the Property or any portion thereof under the power of eminent domain, any proceeds of any policies of insurance maintained with respect to the Property, or the proceeds of any sale, option or contract to sell the Property or any portion thereof. TO HAVE AND TO HOLD the Property unto Secured Party and its successors and assigns forever, subject to the Permitted Exceptions and to all the terms, conditions, covenants and agreements herein set forth, for the security and benefit of Secured Party and its successors and assigns as holders of the Note or any of the documents or instruments evidencing the obligations. FOR THE PURPOSE OF SECURING, in such order of priority as Secured Party may determine: (i) payment of the Indebtedness (as hereinafter defined) and (ii) payment (with interest as provided) and performance by Debtor of the Obligations (as hereinafter defined). IN FURTHERANCE OF THE FOREGOING, Debtor hereby warrants, represents, covenants and agrees as follows: ARTICLE 1 Definitions Certain Defined Terms: As used in this Instrument the following terms shall have the following meanings: Acceleration Notice: A written notice of acceleration of the indebtedness given by Secured Party, as Holder, to Debtor, as Borrower under the Note. Adjusted Net Proceeds: As defined in Paragraph 5.1.E(6) herein. Affiliate: With respect to any Person which is not an individual, (i) any corporation, business trust or other similar entity in which the Person owns, directly or indirectly, at least 51% of each class of equity interest including a power to vote; (ii) any general or limited partnership, joint venture or similar entity in which the Person or any entity described in clause (i) is the managing general partner or (iii) any other entity controlled by or under common control with or controlling the Person. Agreement of Consolidation, Modification, Renewal and Restatement: The Agreement of Consolidation, Modification, Renewal and Restatement of even date herewith between Debtor and Secured Party. Allied Building: as defined in the COREA. Allied Site: as defined in the COREA. Allied Stores: Allied Stores General Real Estate Company, a Delaware corporation which was the successor by merger with Alstores. Alstores: Alstores Realty Corporation, a Delaware corporation which merged into CAC XLVII, Inc. which, in turn, changed its name to Allied Stores. Anchor Store: One of the Anchor Stores. Anchor Stores: The Burdines "B" retail department store operated by Allied Stores on the Allied Site, the Burdines "A" retail department store operated by Burdines on the Federated Site, the Mervyn's retail department store operated by Mervyn's on the Mervyn's Site (formerly the Associated Site), the Penney retail department store operated by Penney's on the Penney Site, and the Sears retail department store operated by Sears on the Sears Site. Applicable Financial Reporting Requirements: As to the Debtor, in accordance with generally accepted accounting principles consistently applied, as to any Person required to do so by any federal or state securities laws or regulations or by such Person's organizational documents, in accordance with generally accepted accounting principles consistently applied, as to DeBartolo, Inc., in accordance with its historical practices utilized with regard to financial statements submitted to Secured Party by DeBartolo, Inc. in past transactions with Secured Party, and as to any other Person, in accordance with a modified cash basis generally accepted in the commercial real estate industry. Application: The Application No. 9300324, dated September 1, 1993, executed by Debtor (referred to as "Borrower" therein) and addressed to Secured Party as modified by the Loan Commitment letter from Secured Party to Debtor dated September 15, 1993 and Letter between Secured Party and Debtor dated September 22, 1993. Approved Manager: Any property manager, unless waived in writing by Secured Party, having at least seven million five hundred thousand (7,500,000) rentable square feet of first class enclosed regional mall space under current management and which is of nationally recognized standing in the area of management and operation of enclosed regional malls, and provided there is no uncured default under any of the Loan Documents, (i) the Transferee of any one time transfer of the entire Real Estate Security permitted under the provisions of Paragraph 4.2.D herein (or in the alternative, its Affiliate) if such Transferee or Affiliate, as the case may be, has at least seven million five hundred thousand (7,500,000.00) rentable square feet of first class enclosed regional mall space under current management and is of nationally recognized standing in the area of management and operation of enclosed regional malls; (ii) any management company in which at least ninety percent (90%) of the economic benefit accrues to Urban Shopping Centers, L.P. or the operating partnership of the real estate investment trust formed by DeBartolo to hold partnership interests in Borrower or any of Borrower's general partners to the extent approved by Lender pursuant to the provisions of Paragraph 4.2 herein, provided, as to each of such management companies separately, such management companies manage as of the date such management company takes over management of the Property: (x) substantially all the enclosed regional malls as to which selection of the management company is controlled by said real, estate investment trust operating partnerships and (y) initially at least seven million five hundred thousand (7,500,000) rentable square feet of first class enclosed regional mall space as to each of said management companies; and (iii) any property manager which manages at least seven million five hundred thousand (7,500,000) rentable square feet of first class enclosed regional mall space and whose management is controlled by and undertaken by the management personnel of nationally recognized standing in the area of the management and operation of enclosed regional malls who are officers and/or employees of DeBartolo or its Affiliates or JMB Realty Corporation or its Affiliates. Approved Manager Business Practices: The ordinary business practices and procedures employed by the Approved Manager in connection with the leasing of space in, and the management of, first class enclosed regional shopping centers. Architect: As defined in Paragraph 5.1.E(1) herein. Assignment of Agreements: The Collateral Assignment of Agreements executed by Debtor in favor of Secured Party on even date herewith. Assignment of Leases: The Modified and Restated Assignment of Lessor's Interest in Leases of even date herewith, executed by Debtor in favor of Secured Party. Associated: Associated Dry Goods Corporation, a Virginia corporation. Associated Building: as defined in the COREA and now known as the Mervyn's Building. Associated Site: as defined in the COREA and now known as the Mervyn's Site. Burdines: Burdines Real Estate, Inc., a Delaware corporation successor in interest to Federated under the COREA. Business Day: Any week-day of the year on which banks are not required or authorized to close under the laws of the United States or the State of Florida. Certified Rent Roll: A rent roll listing all Tenants occupying space at the Property certified by Debtor and in such form, and containing such information, as the certified rent roll of the Property delivered by Debtor to Secured Party in connection with the funding of the Loan. Closing Date: The date of the first disbursement of funds under the Loan. Code: As defined in Paragraph 2.2.D herein. Collateral: As defined in Paragraph 7.1 herein. Collection Expenses: As defined in Paragraph 3.8 herein. COREA: (i) Easement and Operating Agreement by and between Sears, Alstores, Jordan Marsh, Federated, Associated and Debtor dated April 13, 1982 and recorded April 15, 1982 in Official Records Book 11411, Page 1044, Public Records of Dade County, Florida as amended by a First Amendment to Easement and Operating Agreement by and between Sears, Allied Stores, Maas, Burdines, Penney and Mervyn's dated October 22, 1991 and recorded October 22, 1991 in the Official Records Book 15238, Page 2289, Public Records of Dade County, Florida; (ii) Agreement to Operate dated April 13, 1982 between Jordan Marsh Company, Federated, Associated and Developer which was amended by First Amendment to Agreement to Operate dated October 22, 1991 between Maas (successor in interest to Jordan Marsh Company by merger), Burdines (successor in interest to Federated), Penney, Mervyn's (successor by assignment to Associated) and Developer; (iii) Supplemental Agreement dated April 13, 1982 between Sears and Developer which supplements the Easement and Operating Agreement described above in clause (i) of this definition as amended by a First Amendment to Supplemental Agreement of July 8, 1982 which was superseded by a Second Amendment to Supplemental Agreement dated October 22, 1991; (iv) Supplement to Easement and Operating Agreement dated April 13, 1982 between Associated and Developer supplementing the Easement and Operating Agreement described above in clause (i) of this definition; (v) Supplement to Easement and Operating Agreement between Federated and Developer dated April 13, 1982; (vi) Supplement to Easement and Operating Agreement between Penney and Developer dated October 22, 1991; and (vii) Expense Agreement dated April 13, 1982 between Alstores, Jordan Marsh and Developer. COREA Signatories: Sears, Alstores, Jordan Marsh, Federated, Associated, Allied Stores, Maas, Burdines, Penney, Mervyn's and any future additional parties to the COREA other than the Debtor. CPA: As defined in Paragraph 3.6.A.(l)(i) herein. DeBartolo: DeBartolo, Inc., an Ohio corporation. DRC: DeBartolo Realty Corporation, an Ohio corporation. DRPLP: DeBartolo Realty Partnership, L.P., a Delaware limited partnership. DeBartolo Affiliates: As defined in Paragraph 4.2.C herein. DeBartolo Debtor General Partners: As defined in Paragraph 4.2.E herein. DeBartolo Cap: As defined in Paragraph 9.33 herein. DeBartolo Family Affiliates: As defined in Paragraph 4.2.C herein. DeBartolo OPREIT: As defined in Paragraph 4.2.G herein. Default Waiver: As defined in Paragraph 6.1.D herein. Deficiency Amount: As defined in Paragraph 9.33 herein. Department Stores: As defined in the COREA. Equipment and Vehicles: All (i) equipment now owned or leased or hereafter acquired or leased by or on behalf of Debtor (1) located upon or within the Property which is so related to the Land or any portion thereof that an interest arises therein under the real property laws of Florida in which the Land is situated or (2) which, on a per item basis, has a fair market value greater than or equal to $25,000; and (ii) motor vehicles now owned or leased or hereafter acquired or leased by or on behalf of Debtor which have, on a per item basis, a fair-market value greater than or equal to $25,000. Essential Affiliates: As defined in Paragraph 4.2.B(5) herein. Event of Default: As defined in Paragraph 6.1.A herein. Excluded Equipment and Vehicles: All equipment and vehicles which are not Equipment and Vehicles. Exculpated Parties: As defined in Paragraph 9.33 herein. Expenses: As defined in Paragraph 4.2.B(4) herein. Federated: Federated Department Stores, Inc., a Delaware corporation. Federated Building: as defined in the COREA. Federated Site: as defined in the COREA. Final Plans and Specifications: As defined in Paragraph 5.1.E(l) herein. Fixtures: All fixtures now owned or leased or hereafter acquired or leased by or on behalf of Debtor (other than Excluded Equipment and Vehicles) located upon or within the Improvements or now or hereafter installed in, or used in connection with any of the Improvements, including, but not limited to, any and all machinery, vehicles, equipment (other than Excluded Equipment and Vehicles), appliances and fixtures for generating or distributing air, water, heat, electricity, light, fuel or refrigeration or for ventilating or sanitary purposes or for the exclusion of vermin or insects or for the removal of dust, refuse or garbage; all wall safes, built-in furniture and installations, shelving, lockers, partitions, door stops, vaults, elevators, dumbwaiters, awnings, window shades, screens, venetian blinds, light fixtures, fire hoses and brackets and boxes for the same, fire sprinklers, alarm systems, draperies, drapery rods and brackets, screens, linoleum, carpets, built-in furniture, built-in furnishings, plumbing, laundry tubs and trays, ice boxes, refrigerators, heating units, stoves, water heaters, incinerators, communications systems, signs and placards, security systems and installations whether or not permanently affixed to the Land or the Improvements. Future Advance Note: That certain Future Advance Note of even date herewith executed by Debtor in the original principal amount of Two Million Seven Hundred Fourteen Thousand Two Hundred Ninety Dollars ($2,714,290.00), payable to Secured Party or its order. General Partner Constituent of Debtor: As defined in Paragraph 4.2.A herein. General Partner Constituents of the JMB Primary Partnerships: As defined in Paragraph 4.2.D herein. "Good Faith Efforts": Commercially reasonable diligent efforts which shall not include the obligation to pay money or provide any other consideration to a third party to which such third party is not entitled under the terms of existing written agreements between such party and the Debtor with respect to the Property. Grace Period: As defined in Paragraph 6.1.A(2) herein. Gross Revenues: As defined in Paragraph 4.2.B(4) herein. Hazardous Substances Remediation and Indemnification Agreement: The Hazardous Substances Remediation and Indemnification Agreement of even date herewith executed by Debtor and the Other Loan Parties in favor of Secured Party. Impositions: All real estate and personal property and other taxes and assessments, water and sewer rates and charges levied or assessed upon or with respect to the Property, taxes on or measured by the gross rental receipts of the Property or any portion thereof, and all other governmental charges and any interest or costs or penalties with respect thereto, ground rent and charges for any easement or agreement maintained for the benefit of the Property, general and special, ordinary and extraordinary, foreseen or unforeseen, of any kind and nature whatsoever that at any time prior to or after the execution of the Loan Documents may be assessed, levied or imposed, or become a lien upon the Property or the rent or income received therefrom, or any use or occupancy thereof; and any and all other charges, expenses, payments, claims, mechanics' or material suppliers' liens or assessments of any nature, if any, which are or may become a lien upon the Property or the rent or income received therefrom but in all events no income taxes or franchise taxes unless they become a lien on the Property. Impound Account: The account that Debtor may be required to maintain pursuant to Paragraph 3.4.B herein for the deposit of amounts required to pay certain Impositions and insurance premiums. Improvements: All buildings and other improvements and appurtenances located on the Land, including surface improvements, such as parking areas and landscaping structures and all improvements, additions and replacements thereof, and other buildings and improvements (other than Tenant Fixtures and Improvements) at any time hereafter constructed or placed upon the Land. Indebtedness: The principal of and all other amounts, payments and premiums due under the Note and any extensions or renewals thereof (including extensions or renewals at a different rate of interest, whether or not evidenced by a new or additional promissory note or notes), and all other indebtedness of Debtor to Secured Party and additional advances under, evidenced by and/or secured by the Loan Documents, plus interest on all such amounts in accordance with the Loan Documents. Institutional: JMB Institutional Realty Corporation, a Delaware corporation. Institutional Secured Party: As defined in Paragraph 4.2.I herein. Inventory: The personal property inventory prepared by Debtor and delivered to Secured Party in connection with the Loan dated the 31st day of October, 1993. JMB Affiliate: As defined in Paragraph 4.2.D herein. JMB Cap: As defined in Paragraph 9.33 herein. JMB Controlled Affiliate: As defined in Paragraph 4.2.D herein. JMB Loan Parties: As defined in Paragraph 9.33 herein. JMB Primary Partnerships: As defined in Paragraph 4.2.D herein. Jordan Marsh: Jordan Marsh Company, a Florida corporation which merged into Maas. Key Tenant: Any tenant under a Key Tenant Lease. Key Tenant Lease: Leases between Debtor, as landlord, and each and any of the following as tenant: The Limited Stores, Inc. (The Limited, Room 834), Express Inc. (Room 840), Lerner Stores, Inc. (Lerner, Room 938), Lane Bryant, Inc. (Lane Bryant, Room 724) and any other tenant space lease (now or hereafter existing) of the Property or any portion thereof which demises in excess of 7,500 square feet of gross leasable area. Land: As defined in Recital A. Land Use Certification: The Land Use Certification of even date herewith executed by Debtor in favor of Secured Party. Laws and Restrictions: All applicable laws, ordinances, rules and regulations of all local, regional, county, state and federal governmental authorities having jurisdiction over the Property. Leased Assets: That portion of the Personalty described on Exhibit "B" attached hereto. Leases: Any and all leasehold interests, including subleases and tenancies following attornment, now or hereafter affecting or covering the Property or any portion thereof, including, without limitation, Key Tenant Leases, any ground leases, subleases and tenancies following attornment, together with any and all guarantees thereof and any and all extensions and renewals thereof. Loan: The loan from Secured Party to Debtor evidenced by the Note and the Loan Documents. Loan Documents: The Note, this Instrument, Agreement of Consolidation, Modification, Renewal and Restatement, the Assignment of Agreements, the Assignment of Leases, the Hazardous Substances Remediation and Indemnification Agreement, the Other Loan Party Agreement, the Land Use Certification and all other documents executed by Debtor and/or the Other Loan Parties with or in favor of Lender, evidencing, securing or relating to the Loan, the payment of the Indebtedness or the performance of the obligations. Lord & Taylor: The department store formerly operated by Associated on the Associated Site which was replaced by Mervyn's operated on the Mervyn's Site which was formerly the Associated Site. Maas: Maas, Inc., a Delaware corporation which was the successor by merger with Jordan Marsh. Management Agreement: As defined in Paragraph 3.17 herein. Mervyn's: Mervyn's, a California corporation. Mervyn's Site: as defined in the COREA and formerly known as the Associated Site. Mortgaged Premises: As defined in Paragraph 4.2.A herein. Net Operating Income: As defined in Paragraph 4.2.B(4) herein. Net Proceeds: As defined in Paragraph 5.1.C herein. Note: That certain Consolidated, Modified, Renewed and Restated Promissory Note of even date herewith executed by Debtor in the original principal amount of Forty-Seven Million Five Hundred Thousand Dollars ($47,500,000), payable to Secured Party or its order, and all modifications, renewals or extensions thereof which consolidates, modifies, renews and restates the Future Advance Note and the Prior Note, as defined in the Recitals to this Instrument. Obligations: Any and all of the covenants, promises and other obligations (including payment of the Indebtedness) made or owing by Debtor to or due to Secured Party under and/or as set forth in the Loan Documents including, but not by way of limitation, the Hazardous Substances Remediation and Indemnification Agreement. Occurrence: As defined in Paragraph 5.1.C herein. One Time Transfer Conditions: As defined in Paragraph 4.2.B(3) herein. OPREIT: As defined in Paragraph 4.2.G herein. Other Loan Parties: individually and collectively: Urban Shopping Centers, L.P., a Maryland limited partnership, JMB Income Properties, Ltd.-XIII, an Illinois limited partnership, IDS/JMB Balanced Growth, Ltd., an Illinois limited partnership, and DeBartolo, Inc., an Ohio corporation, DeBartolo Realty Corporation, an Ohio corporation, DeBartolo Realty Partnership, L. P., a Delaware limited partnership, and any subsequent Person made an Other Loan Party pursuant to the provisions of this Security Instrument. Other Loan Party Agreement: The Other Loan Party Agreement of even date herewith between the Other Loan Parties and Secured Party. Penney: J. C. Penney Company, Inc., a Delaware corporation. Penney Building: as defined in the COREA. Penney Site: as defined in the COREA. Permitted Exceptions: Those exceptions to title with respect to the Property, as shown in the title insurance policy delivered to and accepted by Secured Party insuring the priority and validity of this Instrument, together with such other liens, encumbrances and other charges as are specifically approved by Secured Party. Person: Any natural person, corporation, partnership, firm, trust, association, government, governmental agency or any other entity, whether acting in an individual, fiduciary or other capacity. Personalty: As defined in Paragraph 7.1 herein. Potential Default: (i) An event or occurrence which, with the giving of notice or the passage of time, or both, would constitute an Event of Default hereunder; or (ii) the filing of a petition of the nature described in Paragraph 6.1.B herein, and such petition shall remain undismissed. Preliminary Plans and Specifications: As defined in Paragraph 5.1.A herein. Prepayment Premium: As defined in the Note. Proceeding: As defined in Paragraph 6.1.B(2) herein. Property: As defined in the above granting paragraph of this Instrument. Prospective Release: As defined in Paragraph 4.2.B(5) herein. Qualified or Qualified Buyer: As defined in Paragraph 4.2.B(2) herein. Real Estate Security: The Land, Improvements, all rents, issues, profits and proceeds therefrom, together with any interest of the owner of the Property in any ingress or egress easements, the interest of the developer in the COREA, or other appurtenances, easements or real property rights or interests relating thereto exclusive of Tenant Fixtures and Improvements. Realty: JMB Realty Corporation, a Delaware corporation. Receiver: Any trustee, receiver, custodian, fiscal agent, liquidator or similar officer. Rents: All rents, royalties, revenues, issues, profits, proceeds and other income from the Property. Required Periods: As defined in Paragraph 4.2.B(4) herein. Risk of Forfeiture: Any material risk that the Property or any part thereof or interest therein will be sold, forfeited, terminated, canceled or lost as the result of a contest or similar proceeding initiated by Debtor or as a result of any other action of Debtor permitted hereunder, as determined by Secured Party. Sears: Sears, Roebuck and Co., a New York corporation. Sears Building: As defined in the COREA. Sears Site: As defined in the COREA. Secondary Interest Rate: As defined in the Note. Security: With respect to any contest or similar proceeding initiated by Debtor or other action of Debtor permitted hereunder (i) a bond; (ii) escrowed cash security; (iii) a Letter of Credit; or (iv) a recourse Guaranty from an acceptable guarantor or guarantors, in each case satisfactory to Secured Party, in an amount equal to the difference between the cost of complying with the requirement or other matter being contested and the cost of any work performed or amounts actually paid by Debtor in respect of such requirement or matter, as applicable, or the amount necessary to eliminate the Risk of Forfeiture, as the case may be, all as determined by Secured Party (i.e., in the case of a real estate tax contest, the difference between (A) taxes calculated based on the assessment or tax rate contested together with all interest and penalties which might be incurred pending final resolution of the contest and (B) the taxes actually paid by Debtor with respect to the period(s) in question). Standard of Conduct: The standard of conduct set forth in Paragraph 9.34 herein. Subsequent Owner: Any successor in interest to Debtor's interest in the Property or any part thereof. Temporary Leases: As defined in Paragraph 4.6.A herein. Tenant: Any tenant of the Property, or any portion thereof. Tenant Fixtures and Improvements: Fixtures and improvements owned by any Tenant under the terms of any Lease exclusive of Debtor's reversionary interest or other rights therein under the terms and conditions of any such Lease. Third Party Transferee: As defined in Paragraph 4.2.F herein. Trademarks: All trademarks, service marks, designs, logos, indicia, tradenames, corporate names, company names, business names, fictitious business names, trade styles owned by Debtor and not the Other Loan Parties and solely used in connection with the Property; including, without limitation, all of the trademarks which are presently or in the future may be owned and used by Debtor solely in conducting its business on the Property but not the Other Loan Parties and including all federal, state and foreign registrations therefor, heretofore or hereafter granted, all proceeds thereof (such as, by way of example and not by way of limitation, license royalties and proceeds of infringement suits), the right (but not the obligation) to register a claim under any state, federal or foreign trademark law or regulation and to renew and extend such trademarks and registrations, the right (but not the obligation) to sue or bring opposition or cancellation proceedings in the name of Debtor or in the name of Secured Party for past, present and future infringements of such trademarks or registrations and all rights (but not obligations) corresponding thereto throughout the world and the associated goodwill; provided that the rights and interests described in this Paragraph shall include, without limitation, rights and interests pursuant to licensing or other contracts in favor of Debtor pertaining to trademarks or registrations presently or in the future owned or used by third parties but only to the extent permitted by such licensing or other contracts and, if not so permitted, only with the consent of such third parties. Provided however, the term "Trademarks" shall not include the names "DeBartolo, Inc.", "The Edward J. DeBartolo Corporation", "DeBartolo Property Management, Inc.", an Ohio corporation, "DeBartolo Realty Partnership, L.P.", a Delaware limited partnership, "DeBartolo Realty Corporation", an Ohio corporation, "JMB Realty Corporation", "JMB Institutional Realty Corporation", "Urban Shopping Centers, L.P.", "Urban Shopping Centers, Inc.", "JMB Retail Properties Co.", "JMB Income Properties, Ltd.-XIII", "IDS/JMB Balanced Income Growth, Ltd." or "JMB/Miami International Associates". Transfer: As defined in Paragraph 4.2.B herein. USCINC: Urban Shopping Centers, Inc., a Maryland corporation. USCLP: Urban Shopping Centers, L.P., an Illinois limited partnership. ARTICLE 2 Representations and Warranties 2.1 Warranty of Title and Authorization. Debtor (i) as of the date hereof, is the lawful owner of the Property other than the Leased Assets (in which the Debtor warrants that its leasehold interest therein is unencumbered except as described in an Exhibit to the Debtor's Borrower's Certificate executed and delivered concurrently herewith) free and clear of all defects, liens, encumbrances, easements, exceptions and assessments, except for the Permitted Exceptions and holds good and marketable title to the Land and Improvements free and clear of all defects, liens, encumbrances, easements, exceptions and assessments except for the Permitted Exceptions; (ii) as of the date hereof, has the good, right and lawful authority to grant the Property as provided in and by this Instrument; and (iii) will forever warrant and defend its grant made herein against any and all claims and demands whatsoever, except as are specifically set forth in this Instrument, but no title insurance company shall be subrogated to Secured Party's rights against Debtor under this Paragraph 2.1 herein or otherwise set forth in this Security Instrument. 2.2 Organization and Authority. Debtor represents and warrants as of the date hereof: A.Debtor is a general partnership duly organized, validly existing and in good standing under the laws of the State of Florida. B.Debtor has the requisite power and authority to own and manage its properties, to carry on its business as it is now being conducted and to own, develop and operate the Property as a regional shopping mall. C.Except as otherwise disclosed in writing to Secured Party before or at the closing of the Loan, to the best of Debtor's knowledge Debtor is in compliance with all laws, regulations, ordinances and orders of public authorities applicable to the Property, the violation of which might have a material and adverse effect upon any interest of the Debtor or the Secured Party in the Property, or the lien or security interest granted by this Instrument. D.Debtor is not a "foreign person" within the meaning of the Internal Revenue Code of 1986, as amended (the "Code"), Sections 1445 and 7701 (i.e., such party is not a nonresident alien, foreign corporation, foreign partnership, foreign trust or foreign estate as those terms are defined in the Code and regulations promulgated thereunder). 2.3 Validity of Loan Documents. Debtor represents and warrants as of the date hereof: A.The execution, delivery and performance by Debtor of the Loan Documents (i) are within the power of Debtor; (ii) have been duly authorized by all requisite partnership action of Debtor; (iii) have received all necessary governmental approvals; and (iv) will not violate any provision of law, any applicable order of any court or agency of government, the organizational documents or incorporation documents of Debtor, any agreement between Debtor or any indenture, agreement or any other instrument to which Debtor or any of its property is bound, or be in conflict with, result in a breach of or constitute (with due notice and/or lapse of time) a default under any such indenture, agreement or other instrument, or result in the creation or imposition of any lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of Debtor, except as contemplated by the provisions of the Loan Documents. B.Each of the Loan Documents executed by Debtor, when executed and delivered to Secured Party, will constitute a legal, valid and binding obligation, enforceable against Debtor, in accordance with its terms (presently the power of sale is not enforceable in Florida) and, except to the extent expressly provided to the contrary in the Loan Documents. 2.4 Financial Statements. Debtor represents and warrants as to the financial statements and other information it has provided to Secured Party that as of the date hereof: A.All financial statements and data with respect to any of the Debtor, Debtor's general partners, each Loan Party and/or the Property that have been given by such Loan Party to Secured Party (i) are complete and correct in all material respects as of the date made; (ii) accurately present the financial condition of such parties and the Property, as the case may be, in all material respects, as of the date made, and the result of the operations of such party and the Property, as the case may be, for the periods for which the same have been furnished; and (iii) except as otherwise disclosed in such financial statements or data, have been prepared in accordance with generally accepted accounting principles consistently applied throughout the periods covered thereby. B.All balance sheets and the notes thereto with respect to Debtor, Debtor's general partners, any Other Loan Party and/or the Property, as the case may be, furnished to Secured Party disclose, all material liabilities of such party and the Property, as the case may be, both fixed and contingent, required under the Applicable Financial Reporting Requirements disclosed therein as of their respective dates. 2.5 Other Information. Debtor represents and warrants as of the date hereof that to the actual knowledge of Debtor all reports, papers, data and information given to Secured Party by Debtor, any of Debtor's general partners, or by any other Loan Party with respect to such party or the Property are accurate and correct in all material respects as of the date made or prepared and are complete insofar as completeness may be necessary to give the Secured Party a true and accurate knowledge of the subject matter. 2.6 This section is reserved. 2.7 Other Arrangements. Debtor represents and warrants as of the date hereof that it has received no notice of a default under and, to the best knowledge of Debtor, there are no existing defaults by Debtor in the performance, observance or fulfillment of any monetary obligation or any material non-monetary obligation, covenant or condition, in each case as set forth in any loan or other material agreement or instrument to which Debtor is a party. 2.8 Additional Representations and Warranties. Debtor represents and warrants as of the date hereof: that Debtor is engaged in owning and operating the Property and the Collateral; except as otherwise disclosed in the Borrower's Certificate executed by Debtor, all costs for labor, equipment and materials used in the construction of the Improvements (except for work performed by Tenants) have been paid in full or will be paid when due; no event has occurred which with the giving of notice or the passage of time, or both, would constitute an Event of Default under any of the Loan Documents; the costs of all Fixtures and Personalty due as of the date hereof have been paid; neither the Property, nor any part thereof, has sustained, incurred or suffered any material damage or destruction which has not been restored; and Debtor owns, directly, and not through any affiliated entity, subject to the Permitted Exceptions, and except for the Leased Assets, all of the Personalty and Fixtures necessary for the operation and management of the Property as a regional shopping center. 2.9 Compliance with Laws. Debtor represents and warrants as of the date hereof that except as disclosed in writing to Secured Party before or at the closing of the Loan, (i) to the best of its knowledge, the Property and the actual use thereof (A) complies with all Laws and Restrictions, the violation of which might have a material and adverse effect upon Debtor, the Property, any interest of Debtor or the Secured Party therein, or the lien or security interest granted by this Instrument, and (B) the Laws and Restrictions contain no unsatisfied conditions necessary for the actual use of the Property as it is currently used; and (ii) it has not received any written notices of violations (which remain uncured) of any Laws and Restrictions with respect to the Property. 2.10 Bankruptcy. Debtor represents and warrants as of the date hereof, that no petition in bankruptcy, petition or answer seeking assignment for the benefit of creditors or appointment of a Receiver with respect to Debtor or any other Loan Party has occurred except as disclosed in writing to Secured Party before or at the closing of the Loan, that it has not received any written notice that any Key Tenant, or any of Sears, Penney, Mervyn's, Burdine's, Allied Stores have commenced or intend to commence any bankruptcy, reorganization, arrangement, liquidation, dissolution, or similar proceeding under the Federal Bankruptcy laws or any state laws pending or contemplated, and no reorganization, arrangement, liquidation, dissolution or similar relief under the Federal Bankruptcy laws or any state laws have been instituted by or against Debtor or any Other Loan Party. With respect to each Key Tenant, except as disclosed in writing to Secured Party before or at the closing of the Loan, to the actual knowledge of Debtor without any inquiry, as of the date hereof no uncured default or event which, with the passage of time or the giving of notice or both, would constitute such a default, has occurred under any Key Tenant Lease, and as of the date hereof no outstanding request for the deferral of any current or future rent has been made by any Key Tenant. 2.11 Taxes. Debtor represents and warrants as of the date hereof that it has filed all federal, state, county and municipal income tax returns required to have been filed by it and has paid all taxes that have become due prior to delinquency pursuant to such returns or pursuant to any assessments received by it (except for any pending tax disputes or contests disclosed in writing to Secured Party), and Debtor does not know of any basis for any additional assessment against it in respect of such taxes. 2.12 FIRPTA Certification. Debtor declares and certifies, under penalty of perjury, that as of the date hereof: (i)Debtor's U.S. Taxpayer I.D. Number is: 34-132-6250 (ii)The business address of Debtor is: West Dade County Associates c/o The Edward J. DeBartolo Corporation 7620 Market Street Youngstown, Ohio 44513-6085 Attention: General Counsel (iii) Debtor is not a "foreign person" within the meaning of Sections 1445 and 7701 of the Internal Revenue Code of 1986, as amended (the "Code") (i.e., Debtor is not a nonresident alien, foreign corporation, foreign partnership, foreign trust or foreign estate as those terms are defined in the Code and regulations promulgated thereunder). (iv) Debtor understands that the information and certification contained in this Paragraph 2.12 may be disclosed to the Internal Revenue Service and that any false statement contained herein could be punished by fine, imprisonment or both. (v) Debtor agrees to indemnify and hold Secured Party harmless of, from and against any and all actual loss, liability, costs, damages, claims or causes of action which may arise or be incurred by Secured Party by reason of any failure of any representation or warranty made by Debtor in this Paragraph 2.12 to be true and correct when made, including any liability for failure to withhold any amount required under Code Section 1445 in the event of foreclosure or other transfer of the Property. ARTICLE 3 Affirmative Covenants Debtor hereby covenants and agrees as follows: 3.1 Obligations of Debtor. The Debtor will timely perform, or cause to be timely performed, all of the Obligations and will maintain and preserve the lien of this Instrument. 3.2 Insurance. A. The Debtor at its sole cost and expense, will keep and maintain for the mutual benefit of Debtor and Secured Party the following policies of insurance covering the Collateral: (i) Insurance against loss or damage to the Improvements, the Personalty and the Fixtures by fire and against loss or damage by other risks embraced by coverage of the type now known as "All Risk," including, but not limited to, earthquake (to the extent available at commercially reasonable rates, in Secured Party's reasonable judgment), riot and civil commotion, vandalism, malicious mischief, burglary, theft and mysterious disappearance, and against such other risks or hazards as Secured Party from time to time reasonably may designate, on a replacement cost basis with a deductible amount not to exceed $100,000.00, no coinsurance provision and in an amount (not less than the loan amount of $47,500,000) (1) equal to one hundred percent (100%) of the then "full replacement cost" of the Improvements, the Fixtures and the Personalty exclusive of any foundations and excavations, without deduction for physical depreciation and (2) such that the insurer would not deem Secured Party a co-insurer under said policies. (ii) Business interruption insurance or insurance against loss of income in an amount not less than twelve (12) months total income from the Collateral including, but not limited to, rental (including, without limitation, percentage rental collected during the immediately preceding twelve (12) months) and taxes and other operating expense reimbursements or payments at then-current income levels. (iii) Commercial General Liability insurance on an occurrence basis with a combined single limit per occurrence in such amounts (not less than $10,000,000.00) as are reasonably approved by Secured Party. (iv) "Builders Risk" insurance during any material construction, repair, replacement, renovation or alteration of the Improvements, in such amounts as are reasonably approved by Secured Party. (v) Boiler and machinery insurance covering boilers and other pressure vessels, the air conditioning system, high pressure piping and other machinery and equipment required for the operation of the Property. (vi) Such other insurance, and in such amounts, as may from time to time be reasonably required by Secured Party. B. All policies of Property insurance required by this Instrument (i) may be paid in installments and shall be approved by Secured Party as to amounts, form, risk coverage, deductibles, and substance and shall be written with companies satisfactory to Secured Party; (ii) shall name Secured Party as an additional insured as its interest may appear; (iii) shall contain a standard Lender's Loss Payable endorsement and other non-contributory standard mortgagee protection clauses acceptable to Secured Party, and at Secured Party's option, a waiver of subrogation rights by the insurer; (iv) shall contain an agreement by the insurer that such policy shall not be materially amended or cancelled without at least thirty (30) days' prior written notice to Secured Party; and (v) shall contain such other provisions as Secured Party deems reasonably necessary or desirable to protect its interest. Any policies containing a coinsurance clause shall include a replacement cost endorsement adequate to ensure that the coinsurance clause is rendered inoperative. C. In the event a blanket policy is submitted to satisfy the responsibilities of the Debtor under this Paragraph 3.2, in addition to such other requirements set forth herein, the Debtor shall deliver to Secured Party a certificate from such insurer indicating that Secured Party is an insured under such policy, designating the amount of such insurance applicable to the Property and providing that such coverage will not be materially amended, cancelled or terminated without at least thirty (30) days advance written notice to Secured Party together with an Insurer's agent Certificate of Insurance of said policy and the mortgagee loss payable and protection clauses. D. The Debtor shall make commercially reasonable efforts to enforce the provisions, if any, contained in the Leases and the COREA which require Secured Party to be named as an additional insured to any insurance coverage required therein and upon written request of Secured Party, the Debtor shall use its Good Faith Efforts to furnish evidence satisfactory to Secured Party that all insurance requirements (including, without limitation, provisions for waivers of subrogation and any requirements for the naming of Tenants, and any of the COREA Signatories as additional insureds) set forth in the Leases and the COREA shall have been satisfied by each party thereto; E. The Debtor shall deliver to Secured Party, at least fifteen (15) Business Days prior to the expiration, cancellation or termination of any of the above-referenced policies ("Expiring Policies") a certificate of a renewal of the Expiring Policies together with evidence of (i) the Debtor's payment of the current installment premium therefor; and (ii) an effective date for such renewed policies which is simultaneous with the termination, cancellation or expiration of such Expiring Policies. F. All (i) proceeds from property, rental curtailment or business interruption insurance, and such other insurance policies required pursuant to this Paragraph 3.2, as the parties may reasonably agree upon (the "Policies"); and (ii) all other right, title and interest in and to all of the Policies and any unearned premiums paid thereon as are assignable, are hereby assigned to Secured Party. G. In the event of foreclosure of this Instrument or deed in lieu thereof, all right, title and interest of the Debtor in and to all policies of insurance in force with respect to the Property or Collateral and all proceeds payable thereunder and unearned premiums thereon shall immediately vest in the purchaser at the foreclosure sale or transferee in lieu of foreclosure. 3.3 Maintenance, Waste and Repair. The Debtor shall at all times cause all of the Improvements and paved parking areas (including landscape and recreational areas) comprising the Property to be maintained in a first-class manner consistent with Approved Manager Business Practices or as otherwise approved in writing by Secured Party. The Debtor may make or permit tenants of the Property to make such alterations as may be contemplated by the Leases approved by Secured Party (or, as applicable, by Leases deemed Approved Leases in accordance with Paragraph 4.6.A below), and may make other alterations provided that such alterations are consistent with Approved Manager Business Practices and do not: (a) materially reduce the total net rentable area of the Property or reduce parking available on the Property below the parking ratio existing on this date as set forth in the Land Use Certification; or (b) adversely affect the structural integrity of the Improvements; or (c) decrease the value of Secured Party's security for the Loan; or (d) violate the provisions of any Lease unless the tenant thereunder has consented thereto; or (e) violate the provisions of the COREA or other agreement binding on the Property or any applicable zoning, building, or other ordinance, regulations or law. Notwithstanding the foregoing, subject to condemnation and applicable laws (but the foregoing will not excuse Debtor's compliance with the applicable parking requirements of the Leases and COREAS), the number of parking spaces shall not be reduced below that approved by Secured Party on the Closing Date or otherwise without Secured Party's advance written approval nor may the parking space layout and configuration and ingress and egress lanes and driveways be changed in any material respect without Secured Party's advance written approval. All water lines or easement facilities of easements running under buildings or structures on the Property will be repaired, serviced, replaced and relocated without damaging such buildings and structures in any material respect or unreasonably interfering with the businesses conducted therein and Debtor will relocate the same, at its expense, if relocation is necessary to avoid such damage or interference. The Debtor will maintain parking on the Property at not less than the number of spaces required to maintain the parking ratio existing on this date as set forth in the Land Use Certification and the Debtor shall not permit any waste of the Property or make any change in the use thereof that will in any way increase any ordinary fire or other hazard insurance premiums or do or permit to be done thereon anything that may in any way impair the security of this Instrument. The Debtor shall not abandon the Property nor leave the Property unprotected, vacant or deserted. 3.4 Impositions; Impounds. A. The Debtor will pay, prior to delinquency, all Impositions (or currently payable installments thereof) that are or that may become a lien on the Property or are assessed against the Property or their rents, royalties, profits and income; provided, however, that the Debtor may, at its expense, contest the amount or validity or application of any such Impositions by appropriate legal proceedings promptly initiated and conducted in good faith and with due diligence, provided further that Secured Party is reasonably satisfied that there will be no Risk of Forfeiture as a result of such contest, including but not by way of limitation, in the case of a real estate tax contest, to the extent necessary to avoid a Risk of Forfeiture, an injunction or court order enjoining the tax collector from collecting the unpaid portion of the Impositions and the tax collector's acknowledgment that he has issued no tax certificates for the unpaid portion and is showing the unpaid portion on the tax roll as being subject to litigation and the Debtor shall have provided Secured Party with Security with respect to such contest. B. Following an Event of Default under any of the Loan Documents and regardless of any cure thereof, in the event Secured Party elects to have the Debtor make monthly deposits for real estate taxes and insurance, the appropriate amount, as determined by Secured Party, shall be added to the regular monthly loan payments. Failure by the Debtor to do so will be considered an additional Event of Default under the Loan Documents. No interest shall accrue or be paid on such deposits. C. In the event that an Impound Account is established pursuant to the terms hereof based upon the occurrence of an Event of Default, in the event of any subsequent default by Borrower under any of the Loan Documents which has not been cured during any applicable grace, notice or cure period, Secured Party may apply the balance of such deposits to any of the Obligations as Secured Party may elect, but neither Debtor, any general partners of Debtor, nor any Other Loan Party shall have any personal liability as to such taxes and insurance which would have been paid had Secured Party so elected to apply such deposits to taxes and insurance. 3.5 Compliance with Law. A. Subject to the terms and provisions of Section 4.2 below Debtor agrees to preserve and keep in full force and effect its existence, rights and powers. Debtor will promptly and faithfully comply in all material respects with all present and future laws, ordinances, rules, regulations and requirements of every duly constituted governmental authority or agency and of every board of fire underwriters (or similar body exercising similar functions) having jurisdiction that is applicable to its interest in the Property or to the Property, or any part thereof, or to the use or manner of construction, occupancy., possession, operation, maintenance, alteration or repair thereof or with respect to any part thereof (but not as to any tenants, occupants or invitees as to which Debtor's duty shall be to enforce the terms and provisions of the occupancy or lease agreements pertaining to such compliance in accordance with Approved Manager Business Practices when Debtor or the Approved Manager has actual knowledge of any such noncompliance), whether or not such law, ordinance, rule, order, regulation or requirement shall necessitate structural changes or improvements or interfere with the use or enjoyment of the Property; provided, however, that Debtor may, at its expense, contest the validity or application of the foregoing by appropriate legal proceedings promptly initiated and conducted in good faith and with due diligence, provided further that Secured Party is reasonably satisfied that (i) there will be no Risk of Forfeiture as a result of such contest and (ii) Debtor shall have provided Secured Party with Security with respect to such contest. B. Debtor shall maintain in full force and effect, free from any violation of any law applicable with respect to all operations conducted on the Property by Debtor (but not any tenants or occupants as to which Debtor's duty shall be to enforce the terms and provisions of the occupancy or lease agreements pertaining to compliance with such laws in accordance with Approved Manager Business Practices when Debtor or the Approved Manager has actual knowledge of any such noncompliance), all licenses or permits necessary or required from any governmental bodies having jurisdiction over the same, for operations currently located or hereafter established on the Property, the lapse or violation of which might have a material and adverse effect on the Property, any interest of Debtor or Secured Party therein, or the lien or security interest granted by this Instrument. 3.6 Books and Records. A. Debtor, without expense to Secured Party, will maintain full and complete books of account and other records reflecting the results of the operation of the Property in accordance with Applicable Financial Reporting Requirements. In addition: (1) Annually, Debtor shall furnish to Secured Party the financial information as follows: (i)Financial statements of Debtor for the most current fiscal year sworn (which shall hereinafter mean certified as being true, correct, and accurate in all material respects by an authorized person, partner, or officer) by Debtor or Certified Public Accountant ("C.P.A.") audited; and (ii)If applicable, financial statements of the general partner(s) of Debtor and Other Loan Parties certified by the delivering party as being true, correct and accurate in all material respects or C.P.A. audited. The financial statements referenced in (1)(i) and (ii) above must include a schedule of all related debt and all material contingent liabilities. (2) Annually, Debtor shall furnish to Secured Party operating information on the Real Estate Security as follows: (i) Annual operating statements prepared on a cash basis of accounting certified by Borrower as being true, correct and accurate in all material respects or C.P.A. audited; and (ii) Copies of paid tax receipts for the most recent tax year; and (iii) A certified rent roll in form as attached as Exhibit K to the Application; and (iv) A schedule showing each tenant's sales for the most recent calendar year as provided to Debtor by the tenants. All of these items must be received each year the Security Instrument is in force by the date which is one hundred twenty (120) days after the end of the Debtor's fiscal year. If any one item is not received within thirty (30) days after written notice by Secured Party to Debtor, Secured Party may declare an event of default under the Loan Documents. (3) Debtor agrees to provide Secured Party with such additional financial or management information as Secured Party may request, and all statements must be in form and substance satisfactory to Secured Party. B. Secured Party shall have the right, during normal business hours, upon five (5) business days' prior written notice, to inspect and make copies of Debtor's books, records, and income tax returns at the Property (but not the books, records and income tax returns of the Other Loan Parties except as may be provided for in the Hazardous Substances Remediation and Indemnification Agreement or in the Limited Guaranty) with reference to the Property for the purpose of verifying any reports, statements or other data submitted to Secured Party pursuant to this Paragraph 3.6 within two (2) years after the same have been submitted to Secured Party. If there has been no Event of Default, then such right shall not be exercised more than once every 12 months. Secured Party shall have the right, at all reasonable times and upon reasonable notice, to audit Debtor's books of account and records pertaining to the Property, all of which shall be made available to Secured Party and Secured Party's representatives for such purpose at the offices of Debtor, from time to time, upon Secured Party's written request. If there has been no Event of Default, then such right shall not be exercised more than once every 12 months. The cost of such audit shall be paid by Debtor in the event that (i) such audit shall disclose an unfavorable variance in income and expenses (on a net basis) from the operations of the Property of five percent (5%) or more from the calculations submitted by Debtor pursuant to the terms of this Paragraph 3.6 or (ii) such audit was in connection with Debtor's failure to deliver its financial statements in a timely manner as required by the terms of this Paragraph 3.6. 3.7 Further Assurances. Debtor, at any time upon the request of Secured Party, will at Debtor's expense execute, acknowledge and deliver all such additional papers and instruments and perform all such further acts and things as may be reasonably necessary to carry out the purposes of the Loan Documents and to subject to the liens thereof any property intended by the terms thereof to be covered thereby and any renewals, additions, substitutions or replacements thereto. 3.8 Indemnity and Attorneys' Fees. Debtor will indemnify, defend, protect, reimburse and hold Secured Party harmless from any and all liability, actual loss, claims, actual damage, reasonable out-of-pocket cost or reasonable out-of-pocket expense (including reasonable attorneys fees) (i) that Secured Party may or might incur hereunder or in connection with the enforcement of any of Secured Party's rights or remedies hereunder or under the other Loan Documents as reasonably construed by Secured Party, any action taken by Secured Party hereunder or thereunder pursuant to the terms and provisions of the Loan Documents, whether or not suit is filed; (ii) in the event of a default under any of the Loan Documents which has not been cured during any applicable grace, notice and cure periods, from all related "Collection Expenses" incurred by Secured Party which shall mean all reasonable out-of-pocket expenses incurred by Secured Party as a result of a default, including but not limited to, all travel costs, third-party appraisal fees, environmental report preparation and testing fees, architectural and engineering expenses, and legal fees and expenses; (iii) by reason or in defense of any and all claims and demands whatsoever that may be asserted against Secured Party arising out of the Property, or any part thereof or interest therein not due to its gross negligence or willful misconduct; and/or (iv) as to which it becomes necessary to defend or uphold the lien of this Instrument or other Loan Documents, other than claims or liability based on events occurring after Debtor loses possession of the Property as a result of the foreclosure of this Instrument, a deed in lieu of such foreclosure, or by appointment of a receiver in any action to foreclose this Instrument. Should Secured Party incur any such liability, loss, claim, damage, cost or expense, the amount thereof with interest thereon at the Secondary Interest Rate from the date incurred (ten (10) days after written notice thereof from Secured Party to Debtor if the same is not incurred as a result of any default by Debtor under any of the Loan Documents) until paid, shall be payable by Debtor immediately on demand, shall be secured by this Instrument, and shall be part of the Indebtedness. 3.9 Litigation. The Debtor will promptly give notice in writing to Secured Party of any litigation (if the amount in controversy exceeds $250,000) commenced or threatened to Debtor's actual knowledge materially adversely affecting Debtor or the Property, other than (i) unlawful detainer proceedings brought by Debtor against any one of the Tenants (excluding Tenants under Key Tenant Leases) and (ii) litigation in which the amount in controversy would be fully covered by insurance proceeds. 3.10 Inspection of Property. Secured Party or its agents, including, but not limited to, third-party property appraisers, environmental engineers, Secured Party employees, architects, engineers, etc., shall have the right to inspect all public areas of the Property during normal business hours without notice provided such parties do not disturb or alarm the tenants, occupants and invitees and, as to nonpublic areas, shall have the right to inspect and conduct testing (no such testing shall be conducted unless permitted under the provisions of the Hazardous Substances Remediation and Indemnification Agreement or after any Event of Default under the Loan Documents) on the Property at all reasonable times upon at least three (3) business days prior written notice accompanied by Debtor should Debtor so elect. Secured Party and such other inspecting parties shall not disturb or alarm the tenants, occupants and invitees of the Property while engaged in such activities. 3.11 Taxes; Tax Receipts. A. Debtor shall file all federal, state, county and municipal income tax returns required to be filed by Debtor with respect to the Property and shall, subject to the provisions of Paragraph 3.4.A herein, pay all taxes that become due pursuant to such returns. B. Debtor shall file all personal property tax and real property ad valorem tax returns required to be filed with respect to the Property and shall pay all personal property tax, real property ad valorem taxes and real property assessments with respect to the Property when due subject to the provisions of Paragraph 3.4.A herein. C. Subject to the provisions of Paragraph 3.11.A and Paragraph 3.11.B herein, Debtor shall exhibit to Secured Party, within seven (7) days after demand made therefor, bills (which shall be receipted from and after the date receipted bills are obtainable) showing the payment to the extent then due of all taxes, assessments (including those payable in periodic installments), water rates, sewer rates, and/or any other Imposition that may have become a lien upon the Property or any Personalty prior to the lien of this Instrument. 3.12 Additional Information. Debtor will furnish to Secured Party, within seven (7) days after written request therefor, any and all information that Secured Party may reasonably request concerning the Property or the performance by Debtor of the Obligations. 3.13 Prepayment. Debtor may prepay the Loan only on the terms and conditions set forth in the Note and Debtor shall pay Secured Party the Prepayment Premium in respect of any prepayment, whether voluntary or involuntary, if required by, and on the terms and conditions set forth in, the Note. 3.14 FIRPTA Affidavit. In the event of any transfer by Debtor of its rights hereunder or of any interest in the Property otherwise permitted under this Instrument, such transferee shall, as an additional condition to such transfer, under penalty of perjury, execute and deliver to Secured Party an affidavit concerning the non-foreign status of the Transferee substantially in the form of Paragraph 2.12 herein. Nothing in this paragraph shall be deemed a modification or waiver of any other provision of any of the Loan Documents limiting, prohibiting or otherwise relating to any transfer of any interest in the Property or Debtor. 3.15 Reimbursement. Any amount paid by Secured Party pursuant to paragraph 15 of the Application including counsel fees, for which invoices were not available on the Closing Date, or which are incurred after the Closing Date and any amount paid by Secured Party pursuant to this Instrument for any tax (but not income taxes or franchise taxes which have not become a lien on the Property), stamp tax, assessment, water rate, sewer rate, insurance premium, repair, rent charge, debt, claim, inspection or lien having priority over this Instrument or to in any way protect the security for the Loan, shall bear interest at the Secondary Interest Rate from the date of payment by Secured Party (ten (10) days after written notice thereof from Secured Party to Debtor if the same is not incurred as a result of any default by Debtor under any of the Loan Documents) , constitute additional indebtedness secured by this Instrument, prior to any right, title or interest in or claim upon the Property attaching or accruing subsequent to the lien of this Instrument and be payable by Debtor to Secured Party within five (5) days after written demand therefor. 3.16 Tax Service Contract. At Debtor's sole expense, Secured Party shall be furnished a fully paid Tax Service Contract throughout the term of the Loan, issued by a tax reporting agency satisfactory to Secured Party. 3.17 Management. Throughout the term of the Loan, an Approved Manager, or alternate manager expressly consented to by Secured Party in writing, shall manage the Property in accordance with Approved Manager Business Practices pursuant to a management agreement approved by Secured Party (collectively, the "Management Agreement"). Except as expressly permitted by the Loan Documents, Debtor shall not terminate alter, modify or amend or permit the termination, alteration, modification or amendment of any of the material terms of the Management Agreement (including, without limitation, terms relating to fees and expenses earned or reimbursed thereunder) without the prior written consent of Secured Party. A change in the Approved Manager without Secured Party's prior written approval shall be a default under this Security Instrument; provided, however, that Secured Party agrees to approve any persons that would qualify as an Approved Manager under the criteria set forth in the definition of "Approved Manager: in Article 1 herein. Upon execution of any such Management Agreement it shall be deemed assigned to Secured Party by Debtor on the terms and conditions of the Collateral Assignment of Management Agreement from Debtor to Secured Party of even date herewith and, as a condition of Secured Party's approval thereof, the manager thereunder shall execute a Consent to Collateral Assignment of Management Agreement on the terms and conditions of such instrument from the Approved Manager on even date herewith which will subordinate the Management Agreement to the Loan Documents on the terms set forth therein. Debtor shall not terminate, alter, modify, amend or permit the termination, alteration or amendment of any material terms of the Management Agreement without Secured Party's advance written consent. 3.18 Plans and Specifications. Debtor agrees to keep at its offices at the Property or at its corporate offices, and to make available to Secured Party during normal business hours, upon five (5) business days prior written notice, As-Built Plans and Specifications or, if unavailable, the final set of plans and specifications from which the Improvements were constructed ("As-Builts"), certified (if such is the case as of the date hereof) by a licensed architect or licensed contractor as true, correct and complete As-Builts for the Improvements. 3.19 Property Description. Debtor agrees not to initiate or consent to any change in the boundary lines or the legal description of the Property, as the same are constituted as of the date hereof, without the prior written consent of Secured Party. ARTICLE 4 Negative Covenants Debtor hereby covenants to and agrees as follows: 4.1 Restrictive Uses. Debtor will not initiate, join in, or consent to any change in the current use of the Property as a regional shopping center or in any zoning ordinance, private restrictive covenant, assessment proceedings or other public or private restriction limiting or restricting the uses that may be made of the Property or any part thereof without the prior written consent of Secured Party. 4.2 Due on Sale or Encumbrance. A. General Restrictions. In the event that Debtor, without the prior written consent of Secured Party (which consent may be withheld for any reason or for no reason without regard to the Standard of Conduct), shall, except as expressly permitted in the Loan Documents, sell, convey, assign, transfer or otherwise dispose of or be divested of its title to, or, shall mortgage, convey security title to, or otherwise encumber or cause to be encumbered, the Real Estate Security (hereinafter sometimes called the "Mortgaged Premises") or any part thereof or any interest therein in any manner or way. whether voluntary or involuntary, or in the event of (a) any merger, consolidation or dissolution involving, or the sale or transfer of all or substantially all of the assets of, Debtor or any General Partner Constituent of Debtor (a "General Partner Constituent of Debtor: is any general partner of Debtor, a general partner of a general partner of Debtor, or a general partner of a general partner of a general partner of Debtor or any other corporation, partnership or entity with an ownership interest in and control over the management of any of the foregoing entities); (b) the transfer (at one time or over any period of time) of 10% or more of the voting stock of (i) a corporate Debtor, (ii) any corporate General Partner Constituent of Debtor, or (iii) any corporation which is the direct or indirect owner of 10% or more of the voting stock of Debtor or any General Partner Constituent of Debtor; (c) the transfer of any general partnership interest in Debtor, in any General Partner Constituent of Debtor or in any partnership which is a direct or indirect general partner of Debtor; or (d) the conversion of any such general partnership interest to a limited partnership interest, then the entire balance of the secured indebtedness, plus the Prepayment Premium, shall become immediately due and payable at the option of Secured Party. This provision shall not apply to transfers of title or interest under any will or testament or applicable law of descent, and any transfers of limited partnership interests. In addition, this paragraph, as applicable to USCINC., USCLP, Realty, Institutional, DRC (this sentence shall not be applicable to DRC until the "Going Public Condition Precedent", as defined below, is satisfied) and DRPLP (this sentence shall not be applicable to DRPLP until the "Going Public Condition Precedent", as defined below, is satisfied) shall (aa) not apply to or prohibit the sale or transfer of any stock in USCINC. or DRC; (bb) upon satisfaction of all the requirements of Paragraph 4.2.G below, not apply to or prohibit the sale or transfer to DRPLP of any general partnership interest in Borrower or in any General Partner Constituent of Borrower which, in each case, is owned by a DeBartolo Affiliate, as defined in Paragraph 4.2.C herein; (cc) upon satisfaction of all the requirements of Paragraph 4.2.G below, not apply to or prohibit the conversion of the general partnership interest of Mr. Edward J. DeBartolo, Sr. in DeBartolo-Miami Associates, an Ohio general partnership ("DMA"), a General Partner Constituent of Borrower, into a limited partnership interest therein and the conversion of DMA from a general partnership to a limited partnership, provided that DRPLP is the sole general partner thereof; and/or (dd) not apply to or prohibit the sale or transfer of any stock of Realty or Institutional to or among any JMB Affiliate, as defined in Paragraph 4.2.D or to or among any senior level officers, managing directors or majority shareholders of Realty or Institutional at the time of the transfer, as well as all lineal descendants of said persons, their spouses, members of their immediate families and trusts exclusively for the benefit of such persons. The "Going Public Condition Precedent: shall mean that the public offering of common stock in DRC has closed in a manner not materially different from that described in the most recent Securities and Exchange Commission Form S-11 for DRC furnished Secured Party prior to the date hereof and that DRPLP is established and owns and controls the assets as described therein without material variances from such description. B. One Time Transfer of the Entire Mortgaged Premises. Notwithstanding the provisions of Paragraph 4.2.A herein, Debtor may, unless such right has been terminated under the provisions of Paragraph 4.2.F herein, transfer the entire Mortgaged Premises ("Transfer") one (1) time during the term of the Loan (any transfer by Debtor pursuant to said right, shall automatically nullify the right to transfers under Paragraph 4.2.B through Paragraph 4.2.K herein) by complying with all of the requirements of this Paragraph 4.2.B as follows: (1) Debtor shall provide Secured Party with a written request (such request shall be accompanied by a Notice stating "Warning - failure to notify Debtor within ten (10) business days of receipt of this Notice stating any additional information or documentation needed, shall waive the right to further request the same and any failure to approve or disapprove the proposed buyer within thirty (30) days of receipt of all of the foregoing, shall be deemed Secured Party's approval of said buyer) accompanied by a $5,000.00 review fee, the documentation of the Revenues and Expenses for the twelve (12) months prior to the Debtor's written request for the Transfer and a budget for such Revenues and Expenses for the twelve (12) months after the Debtor's written request for the Transfer as required by Paragraph 4.2.B(4) herein. Secured Party agrees that within thirty (30) days of receipt of such written notification and of delivery to Secured Party of all information and documentation reasonably required by Secured Party to make its determination (Secured Party agreeing to make such request for information within 10 business days of Debtor's written request for approval of the Transfer and payment of the review fee), Secured Party shall allow the proposed buyer to assume the obligations under this Security Instrument and other Loan Documents, subject to the exculpation herein and therein contained, (i) if the "One Time Transfer Conditions", defined below in Paragraph 4.2.B(3), are fulfilled and (ii) if any such proposed buyer is approved by Secured Party, as being "Qualified" as defined in Paragraph 4.2.B(2) herein; (2) As used herein, "Qualified" or "Qualified Buyer" shall mean the proposed buyer, as determined by Secured Party (the numerical tests are to be satisfied based on the information furnished by Debtor and supplied by Debtor and/or the purchaser) , (aa) has, either in its own right or through Affiliates jointly and severally liable under the assumption, a net worth in excess of $100,000,000.00, (bb) has a current ratio, as determined under generally accepted accounting principles consistently applied, of current assets to current liabilities of not less than 1.20 to 1.00, (cc) owns (either in its own right or through Affiliates) in excess of $500,000,000.00 of commercial real estate assets including regional malls, (dd) itself would qualify herein as an Approved Property Manager meeting the requirements set forth in Paragraph 3.17 of this Security Instrument for the change in the property manager without Secured Party's approval or has a written commitment from such a property manager pursuant to a management agreement, in form and substance and with a term approved by Secured Party before the occurrence of the Transfer, (ee) is creditworthy and of good character, and (ff) such proposed buyer and/or its Affiliates have not been the source of specific and identifiable material problems in prior business dealings with Secured Party (Debtor acknowledges that Secured Party is not obligated to disclose the nature of such specific and identifiable problems except in connection with any litigation between Debtor and Secured Party); (3) the "One Time Transfer Conditions" are that (aa) there shall be no uncured monetary default or nonmonetary Event of Default existing under the Loan Documents; (bb) the proposed Transfer is not in violation of Paragraph 9.26 herein and Secured Party shall have received the certification required by Paragraph 9.26.G(2) herein; (cc) the proposed transferee shall have signed an assumption agreement acceptable to Secured Party with respect to the Loan Documents, subject to the same limitations on liability as is set forth in Paragraph 9.33 herein except as to any full recourse provision in any Loan Document such as in the Hazardous Substance Remediation and Indemnification Agreement but with no other required modification in any Loan Document; (dd) Secured Party receives an endorsement to Secured Party's Mortgagee Title Policy changing the effective date to the time of the Transfer and showing no additional title exceptions or matters objectionable to Secured Party; (ee) in consideration for the approval of such Transfer, Secured Party shall, at the time of the Transfer, be paid a transfer fee of one percent (1%) of the then outstanding principal balance of the Note on the date of the Transfer less the review fee previously paid provided that (x) any documentary stamp taxes, intangible taxes, recording fees, and other costs and expenses required in connection with the assumption agreement are paid by Debtor or the transferee and (y) all other reasonable out-of-pocket costs and expenses (including attorneys' fees) of preparation of the assumption agreement and obtaining the endorsement to the Secured Party's Mortgagee Title Policy are paid by Debtor or the transferee; (ff) the Mortgaged Premises shall have generated Net Operating Income (as defined in Paragraph 4.2.B(4) below) of not less than $7,100,000.00 for the Required Periods, as defined in Paragraph 4.2.B(il below and the loan to value ratio pertaining to the fair market value of the Real Estate Security and the then unpaid principal balance of the Loan at the time of the Debtor's written request for approval of the Transfer does not exceed sixty-five percent (65%), (gg) Debtor and the Other Loan Parties are not released from their recourse obligations under the Loan Documents, including, but not by way of limitation, the Hazardous Substance Remediation and Indemnification Agreement, unless they qualify for release as set forth in Paragraph 4.2.B(5) below; and (hh) the proposed transferee shall have complied with any transfer requirements under the COREA and assumed Debtor's obligations thereunder from and after the Transfer subject to any exculpation set forth in the COREA; (4) "Net Operating Income" shall mean "Gross Revenues" generated directly by the operation of the Mortgaged Premises less "Expenses" directly from the operation of the Mortgaged Premises for the "Required Periods" where: (A) "Gross Revenues" shall mean all (aa) fixed minimum rent, (bb) percentage rent, (cc) tenant reimbursement for common area maintenance, taxes, assessments, insurance, any administrative fees, and any other reimbursements, (dd) food court tenant expense reimbursement, (ee) Anchor Store contributions to common area and/or exterior mall maintenance and other payments and reimbursements, (ff) recurring miscellaneous revenues including temporary tenant rents and vending machine income, (gg) proceeds from rent loss insurance provided the casualty to the Mortgaged Premises which induced the loss of rents has been restored or is in the process off restoration, (hh) merchants' association and other marketing and advertising contributions, (ii) parking revenues, and (jj) all other revenues such as application of security deposits and tenant litigation judgments and settlements (but in the latter two instances, said items cannot be included for budget projection purposes); (B) "Expenses" shall mean all (aa) real estate and other taxes and assessments, both general and special, due and payable by Debtor (based upon the latest available official rate and valuation); (bb) insurance premiums paid or due and payable by Debtor (according to the latest premium billings); (cc) salaries and fringe benefits paid or payable by Debtor to employees of Debtor or to the employees of the management company and which pertain to the Mortgaged Premises (including, by way of illustration, any manager,, secretary, engineer, maintenance assistant, or administrative personnel) ; (dd) commercially reasonable management fees; (ee) other ordinary and necessary operating expenses paid or due and payable by Debtor including supplies, building repair and maintenance, grounds and parking lot maintenance, janitorial service, security, and utility expenses (refuse collection), cable T.V., electric, gas, water, sewer and telephone); (ff) contractual merchants association contributions; and (gg) leasing commission obligations paid or due and payable by Debtor and amortized (including those paid in one or more lump sum payments) over the lease term. Debt service, income taxes, depreciation and amortization, capital expenditures, restoration expenditures and tenant finish costs are specifically excluded from Total Expenses; and (C) the "Required Periods" shall mean the twelve (12) month period prior to Debtor's written request for approval of the Transfer based on actual Net Operating Income during that period and the twelve (12) month period after Debtor I s written request f or approval of the Transfer. Net Operating Income for the twelve (12) month period before Debtor's written request for approval of the Transfer shall be based on documentation of revenue and expenses for said period presented to Secured Party at the time of the request for the consent to the Transfer and certified to Secured Party by the general partners of Debtor as being true, correct and accurate in all material respects. Net Operating Income for the twelve (12) month period after the Transfer shall be based on a budget for that period submitted by Debtor to Secured Party at the time of the request for consent to the Transfer. The budget shall reasonably project revenues and expenses based on historical performance and then current market conditions; (5) The Debtor and the Other Loan Parties will not qualify for a release from their recourse obligations under the Loan Documents including, but not by way of limitation, the Hazardous Substances Remediation and Indemnification Agreement, unless the Qualified Buyer and its Affiliates essential to meeting the Qualified Buyer criteria ("Essential Affiliates") assume the obligations of Debtor and the Other Loan Parties under the Loan Documents subject to the exculpation provided in the Loan Documents but only to the extent so provided. In addition, any release shall be a "Prospective Release" which shall be a release as to recourse obligation's under the Loan Documents occurring or arising subsequent to the Transfer to and assumption of the obligations under the Loan Documents by such Qualified Buyer and any Essential Affiliates. Notwithstanding the foregoing, no release shall be given if there is any uncured default by Debtor under any of the Loan Documents. After Secured Party has granted a Prospective Release, then (A) as to all recourse obligations under the Loan Documents other than under the Hazardous Substance Remediation and Indemnification Agreement, at the date of the payment of the Loan in full or the completion of any foreclosure sale proceedings or deed in lieu of foreclosure of the Loan Documents, Secured Party shall release the Debtor which made the Transfer and those who were Other Loan Parties immediately prior to the Transfer from their obligations under the Loan Documents not then subject to a claim by Secured Party; and (B) as to all recourse obligations under the Hazardous Substance Remediation and Indemnification Agreement, at the expiration of three (3) years after the earlier of (i) the date of the payment of the Loan in full, and (ii) the date of the completion of any foreclosure sale proceedings or deed in lieu of foreclosure of the Loan Documents, Secured Party shall release the Debtor which made the Transfer and those who were Other Loan Parties immediately prior to the Transfer from their obligations under the Loan Documents not then subject to a claim by Secured Party; and (6) Notwithstanding the foregoing in this Paragraph 4.2.B herein, if Secured Party approves the Qualified Buyer and any proposed Other Loan Party replacements, such approval shall not be effective beyond one hundred- twenty (120) days after Secured Party has given Debtor written notice thereof. Debtor may, at least ten (10) business days before the expiration of said one hundred twenty (120) day period, request, in writing, a one time extension thereof for an additional ninety (90) day period. The request shall be accompanied by updated current information with respect to the Qualified Buyer determination and the One Time Transfer conditions as well as documentation evidencing that Debtor has been pursuing the Transfer with reasonable diligence and that there is a basis to reasonably believe the Transfer will be completed in accordance with the provisions of this Paragraph 4.2.B before the end of the requested extension period. Should such information and documentation, in Secured Party's reasonable judgment, evidence that the proposed buyer will remain a Qualified Buyer for the extension period, that the One Time Transfer Conditions will remain satisfied during said period, that Debtor has been pursuing the Transfer with reasonable diligence and that there is a reasonable basis for believing the Transfer will be completed in accordance with the provisions of this Paragraph 4.2.B before the expiration of the requested extension period, the extension shall be granted. C.Internal DeBartolo General Partnership Transfers. Notwithstanding the provisions of Paragraph 4.2.A herein, as long as there is no uncured monetary default or nonmonetary Event of Default by Debtor under any of the Loan Documents and the proposed transfer is not in violation of Paragraph 9.26 herein, any general partnership interest in any General Partner Constituent of Debtor, as defined in Paragraph 4.2.A herein, owned by any DeBartolo Affiliate, as defined below, may be transferred at any time and from time to time to and among any DeBartolo Affiliate. The DeBartolo Affiliate shall mean any wholly owned subsidiary of DRC and/or DRPLP, provided that the Going Public Condition Precedent in Paragraph 4.2.A has been satisfied and that DRPLP and DRC (as the general partner of DRPLP) remain responsible on a recourse basis (and execute such documentation evidencing such obligation in form and substance satisfactory to Secured Party) for the obligations of the Other Loan Parties (to the extent set forth in the Loan Documents, including, but not by way of limitation under the Other Loan Party Agreement and the Hazardous Substances Remediation and Indemnification Agreement) and the "DeBartolo Family Affiliates" which means any one or more of the lineal descendants of Mr. Edward J. DeBartolo or their spouses or any members of their immediate families or any trusts exclusively for the benefit of the aforementioned persons. D. Internal JMB General Partnership Transfers. Notwithstanding standing the provisions of Paragraph 4.2.A herein, as long as there is no uncured monetary default or nonmonetary Event of Default by Debtor under any of the Loan Documents and the proposed transfer is not in violation of Paragraph 9.26 herein, any general partnership interest in JMB Income Properties, Ltd.-XIII IDS/JMB Balanced Income Growth, Ltd. or Urban Shopping Centers, L.P. (collectively the "JMB Primary Partnerships"), any general partner of any of the JMB Primary Partnerships or any general partner of any general partner of any of the JMB Primary Partnerships ("General Partner Constituents of the JMB Primary Partnerships") owned by any JMB Controlled Affiliate, as defined below, may be transferred from time to time to any JMB Controlled Affiliate which shall mean (I) Urban Shopping Centers, Inc., and Urban Shopping Centers, L - P. and (II) any other Person so long as one or more.of JMB Realty Corporation, a Delaware corporation ("Realty") , or JMB Institutional Realty Corporation, a Delaware corporation ("Institutional"), or a JMB Affiliate (as hereinafter defined) (A) own at least fifty percent (50%) of the economic interests that is directed or managed on the basis of ownership of economic interests of the entity in question; (B) act as a managing general partner of a general partnership that is the entity in question; (C) act as the sole general partner of a limited partnership that is the entity in question or as a general partner of a limited partnership (having more than one general partner) that is the entity in question but with the power to direct and manage such limited partnership; or (D) act as the investment manager or advisor for a real estate investment trust, foundation, common fund or investor account that is the entity in question for which Realty, Institutional or a JMB Affiliate (x) acts generally as investment manager or advisor with respect to more than one property, or (y) acts as investment manager or advisor for a multi- investor trust, foundation, common fund or investor account with respect to the Real Estate Security. The term "JMB Affiliate" means any corporation, partnership, trust or other entity that (A) is a primary, secondary or tertiary subsidiary or affiliate of Realty or Institutional, or (B) has as its officers, directors or shareholders, persons who are senior level officers, managing directors or majority shareholders of Realty or Institutional at the time of the transfer. As long as the foregoing conditions are met, transfers of nonmanaging general partnership interests only, shall be permitted to or by any senior level officers, managing directors or majority shareholders of Realty or Institutional at the time of the transfer as well as all lineal descendants of said persons, their spouses, members of their immediate families and trusts exclusively for the benefit of such persons. E. Transfers between JMB and DeBartolo. Notwithstanding the provisions of Paragraph 4.2.A herein, as long as there is no uncured monetary default or nonmonetary Event of Default by Debtor under any of the Loan Documents, the proposed transfer is not in violation of Paragraph 9.26 herein and the Loan Documents are, simultaneous with each such transfer, modified in a manner acceptable to Secured Party, to reflect the transfer and change in the application of the JMB Cap and DeBartolo Cap and Debtor pays Secured Party a fee of $5,000.00 in conjunction with each such modification along with Secured Party's reasonable attorney' s fees in connection therewith, then, the fifty percent (50%) partnership interest in Debtor owned by certain DeBartolo Affiliates which are general partners of Debtor on the Closing Date (collectively the "DeBartolo Debtor General Partners") and the fifty percent (50%) partnership interest in Debtor owned by JMB/Miami International Associates, may be transferred in their entirety, only, pursuant to a one time right of transfer on the part of the DeBartolo Debtor General Partners to transfer such fifty percent (50%) interest owned by them to a JMB Controlled Affiliate and pursuant to a one time right of transfer on the part of the JMB/Miami International Associates to transfer such fifty percent (50%) interest owned by it to a DeBartolo Affiliate. No one or less than all of the DeBartolo Debtor General Partners may exercise the one time right of transfer under this paragraph unless those so exercising same do so with respect to the entire fifty percent (50%) general partnership interest in Debtor. Upon any such transfer, the DeBartolo Cap (defined in Paragraph 9.33 herein), if a DeBartolo Affiliate is the transferee, and the JMB Cap (defined in Paragraph 9.33 herein) , if a JMB Control led Affiliate is the transferee, shall no longer be applicable to the liability of the transferee as an Other Loan Party, but will remain applicable as to the transferor (e.g. if a DeBartolo Affiliate is the transferor of a transfer immediately after closing, DeBartolo's Other Loan Party liability is subject to the DeBartolo Cap, but the Other Loan Party liability of the JMB Loan Party is not thereafter subject to the JMB Cap so the JMB Loan Parties will become liable for 100% of said Other Loan Party obligations while DeBartolo, on a joint and several basis, remains liable therefor subject to the DeBartolo Cap). Notwithstanding the foregoing, any Other Loan Party Transferor under this paragraph may make a written request to Secured Party for a release to Secured Party f or a release on the terms and subject to the conditions set forth in Paragraph 4.2.K herein. F. 50% Transfer by JMB or DeBartolo to a Third Party. Notwithstanding the provisions of Paragraph 4.2.A herein, as long as the transferor and transferee comply with all of the provisions of and meet all of the conditions and requirements of Paragraph 4.2.B herein for Secured Party's consent to a one time transfer of the Mortgaged Premises which shall be applicable to transfers under this paragraph except that the One Time Transfer Conditions set forth in Paragraph 4.2.B(3)(ff) herein (Net Operating Income and loan to value requirements) shall not be applicable, the transfer fee in Paragraph 4.2.B(3)(ee) herein shall be one-half of one percent (.5%) instead of one percent (1%), and the release provisions of Paragraph 4.2.B(5) herein will apply only to the Transferor Other Loan Party, then, the fifty percent (50%) general partnership interest in Debtor owned by the DeBartolo Debtor General Partners, as defined in Paragraph 4.2.E above, or the fifty percent (50%) general partnership interest in Debtor owned by JMB/Miami International Associates, may be transferred, in their entirety, only, pursuant to a one time right of transfer on the part of the DeBartolo Debtor General Partners to transfer such fifty percent (50%) interest owned by them to a third party other than a DeBartolo Affiliate or a JMB Controlled Affiliate ("Third Party Transferee") or pursuant to a one time right of transfer on the part of JMB/Miami International Associates to transfer such fifty percent (50%) interest owned by it to a Third Party Transferee. No one or less than all of the DeBartolo Debtor General Partners may exercise the one time right of transfer under this paragraph unless those so exercising same do so with respect to the entire fifty percent (50%) general partnership interest in Debtor. Notwithstanding the foregoing, once the first of (i) the DeBartolo Debtor General Partners or (ii) JMB/Miami International Associates have completed a transfer under this paragraph, (A) there shall no longer be a right to any transfers under Paragraph 4.2.E above, if The DeBartolo Debtor General Partners are the first to make such a transfer, there shall no longer be a right to any transfers under Paragraph 4.2.C and Paragraph 4.2.H herein, and if JMB/Miami International Associates is the first to make such a transfer, there shall no longer be a right to any transfers under Paragraph 4.2.D above and Paragraph 4.2.H below, and (B) the provisions of this Paragraph 4.2.F shall thereafter apply to a subsequent transfer under this paragraph by the other partner except that (x) if the first Third Party Transferee is the Third Party Transferee under such subsequent transfer, it must again be approved by Secured Party as Qualified under Paragraph 4.2.B(l) and (2) above applied to then current information, (y) the requirement of Paragraph 4.2.B(3)(ff) herein (Net operating Income and loan to value requirements) will be applicable, and (z) after such second transfer, there shall no longer be a right to any transfers under Paragraph 4.2.B through 4.2.K herein. The release provisions of Paragraph 4.2 B(5) herein shall apply to transferors under this Paragraph 4.2.F. G. Initial Transfers to the DEBARTOLO REIT. Notwithstanding the provisions of Paragraph 4.2.A herein, as long as (i) there is no uncured monetary default or nonmonetary Event of Default by Debtor under any of the Loan Documents; (ii) the proposed transfer is not in violation of Paragraph 9.26 herein; (iii) Secured Party shall have received the certification required by Paragraph 9.26.G(2) herein; (iv) the Going Public Condition Precedent in Paragraph 4.2.A is satisfied and real estate investment trust operating partnership ("OPREIT") for the real estate investment trust involved meets the Qualified Buyer requirements of Paragraph 4.2.B(2) above and becomes an Other Loan Party and assumes the obligations of an Other Loan Party under the Loan Documents including the Hazardous Substances Remediation and Indemnification Agreement and the Other Loan Party Agreement subject to the exculpation provided in the Loan Documents but only to the extent so provided; (v) Debtor has provided prior written notice thereof to Secured Party and has submitted to Secured Party such information concerning the Transfer and the real estate investment trust and its OPREIT as Secured Party may reasonably require (including, but not by way of limitation, a current organization chart showing the transfer, initial financial statements, and a description of its operations and management, which such information shall be reasonably acceptable to Secured Party) ; (vi) Debtor has paid Secured Party a $5,000 review fee as to such transfer upon submitting such information to Secured Party; and (vii) pays Secured Party's reasonable attorney's fees in connection therewith, then, such conditions having been satisfied, DeBartolo may establish its real estate investment trust and related OPREIT and the partnership interest of The DeBartolo Debtor General Partners may be transferred to the DeBartolo OPREIT ("DeBartolo OPREIT") . Secured Party acknowledges that prior to the execution of this Security Instrument general partnership interests in Debtor and its General Partner Constituents have occurred including transfer of general partnership interests in Debtor to DRPLP, all as disclosed by DeBartolo, Inc. to Secured Party on even date herewith. Such transfers did not meet the foregoing requirements and Debtor agrees that such transfers do not waive the requirements of Paragraph 4.2 herein as to future transfers, including but not in limitation thereof, the provisions of Paragraph 4.2.K which is not applicable to the transfers which have occurred to date as described above. Secured Party agrees that should, at the time the Going Public Condition Precedent in Paragraph 4.2.A is satisfied, the DeBartolo OPREIT and the OPREIT connected therewith be substantially similar to that set forth in the most recent Securities and Exchange Commission Form S-11 for DRC furnished Secured Party prior to the date hereof, then said OPREIT shall be deemed a "Qualified Buyer" for the purposes of this Paragraph 4.2.G if such Going Public Condition Precedent occurs within one hundred twenty (120) days after the date of the Security Instrument. H. JMB Transfers to the JMB OPREIT or DeBartolo OPREIT. Notwithstanding the provisions of Paragraph 4.2.A herein, as long as there is no uncured monetary default or nonmonetary Event of Default by Debtor under any of the Loan Documents and the proposed transfer is not in violation of Paragraph 9.26 herein, there shall be a one time right to transfer all of the general partnership interests in JMB/Miami International Associates owned by JMB Income Properties, Ltd.-XIII and IDS/JMB Balanced Income Growth, Ltd., together, to Urban Shopping Centers, L.P. (regardless of any change of the name of such entity now known by such name) or to the DeBartolo OPREIT, as defined in Paragraph 4.2.G herein, provided, by the time of the transfer, the transferee DeBartolo OPREIT has satisfied the applicable requirements of Paragraph 4.2.G above. I. Partnership Interest Pledges to Institutional Secured Parties. Notwithstanding the provisions of Paragraph 4.2.A herein, as long as (i) there is no uncured monetary default or nonmonetary Event of Default by Debtor under any of the Loan Documents; (ii) the proposed transfer is not in violation of Paragraph 9.26 herein; (iii) Secured Party shall have received the certification required by Paragraph 9.26.G(2) herein; and (iv) all reasonable out-of-pocket costs and expenses required in connection with such transfer are paid by Debtor or the pledgor, then, such conditions having been satisfied, any general partnership interest in Debtor or any General Partner Constituent of Debtor may be pledged to any "Institutional Secured Party" to secure any bona fide arms-length obligation of the pledgor incurred in the ordinary course of such Institutional Secured Party's business and not incurred for the purpose of avoiding the restrictions set forth in Paragraph 4.2.A herein, provided the same creates no lien or security interest in the Mortgaged Premises, any part thereof, or in any collateral for the Loan other than the partnership interest in question. An "Institutional Secured Party" is a bank, bank holding company, savings institution, or trust company, insurance company, pension, retirement, or profit sharing fund or trust or other entity which has, for at least five (5) years prior thereto, been in the business of making such loans to be so secured by such partnership interests and has assets of at least Five Hundred Million Dollars ($500,000,000). J. Partner Loans. Notwithstanding the provisions of Paragraph 4.2.A herein, as long as (i) there is not uncured monetary default or nonmonetary Event of Default by Debtor under any of the Loan Documents; (ii) the proposed partner loans are not in violation of Paragraph 9.26 herein; (iii) such loan is not secured by any lien or security interest in the Mortgaged Premises or any part thereof, or in any collateral for the Loan; and (iv) all reasonable out-of-pocket costs and expenses required in connection with such transfer are paid by Debtor, then, such conditions having been satisfied, any General Partner of Debtor or General Partner Constituent of Debtor may make loans to Debtor or to any general partners of Debtor for the partnership purposes of Debtor provided such loans are fully subordinated to the Loan and all obligations of Debtor and the Other Loan Parties under the Loan Documents. Any such subordinate loans shall expressly provide (as shall the Loan Documents) that no payments thereon may be made from any sums derived from the Mortgaged Premises unless all amounts due and payable under the Loan Documents are current and not delinquent and that in no event shall any such payments be made during any uncured default under the Loan Documents or after any acceleration of the sums due thereunder by Secured Party. In the event any partnership interest in Debtor or any General Partner Constituent of Debtor is pledged to secure any such partner loans, any transfer of any such interests to the secured party free of the transferor's interest pursuant to such secured party's right under said pledge shall be subject to the provisions of this Paragraph 4.2 and shall be prohibited unless satisfying the requirements of any exception to Paragraph 4.2.A herein set forth in this Paragraph 4.2. Should such transfer to any such secured party satisfy the requirements of any exception to Paragraph 4.2.A herein applicable to any such transfer, any release provisions pertaining to any such applicable exception shall, as in the case of any other transfer covered by the applicable exception, apply to such transfer to the secured party. K. Release Rights. As to any transfers under Paragraphs 4.2.C, 4.2.D, 4.2.E, 4.2.G, 4.2.H, 4.2.I, 4.2. and 4.2.L herein, the Other Loan Parties will not qualify for a release from their obligations under the Loan Documents, including but not by way of limitation, the Hazardous Substances Remediation and Indemnification Agreement except (1) Paragraph 4.2.B herein shall apply to transferors under Paragraph 4.2.F herein and (2) where there is a Transfer pursuant to Paragraph 4.2.E (The Prospective Release, in the case of Paragraph 4.2.E herein, shall apply to the transferor as well as all affiliates of the transferor which are Other Loan Parties), Paragraph 4.2.G or 4.2.H herein and the transferor makes a written request to Secured Party for such release, and based on application of the Qualified Buyer provisions of Paragraph 4.2.B(2) above to the Transferee, Secured Party approves the release (the approval shall not be unreasonably withheld), then the transferee in such cases shall assume all of the Other Loan Party obligations of transferor by executing an assumption agreement acceptable to Secured Party and any such transferor shall be released by a Prospective Release; provided however, after Secured Party has granted a Prospective Release, then (A) as to all recourse obligations under the Loan Documents other than under the Hazardous Substance Remediation and Indemnification Agreement, at the date of the payment of the Loan in full or the completion of any foreclosure sale proceedings or deed in lieu of foreclosure of the Loan Documents, Secured Party shall release the Debtor which made the Transfer and those who were Other Loan Parties immediately prior to the Transfer from their obligations under the Loan Documents not then subject to a claim by Secured Party; and (B) as to all recourse obligations under the Hazardous Substance Remediation and Indemnification Agreement, at the expiration of three (3) years after the earlier of (i) the date of the payment of the Loan in full, and (ii) the date of the completion of any foreclosure sale proceedings or deed in lieu of foreclosure of the Loan Documents, Secured Party shall release the Debtor which made the Transfer and those who were Other Loan Parties immediately prior to the Transfer from their obligations under the Loan Documents not then subject to a claim by Secured Party. Notwithstanding the foregoing, no release shall be given if there is any uncured default by Debtor under any of the Loan Documents. L. DeBartolo OPREIT General Partner Transfers. Notwithstanding the provisions of Paragraph 4.2.A herein, as long as (i) there is no uncured monetary default or nonmonetary Event of Default by Debtor under any of the Loan Documents; (ii) the proposed transfer is not in violation of Paragraph 9.26 herein; (iii) the requirements of Paragraph 4.2.G have been satisfied; (iv) DRC remains the managing general partner of DRPLP and the holder of more than 50% of the general partnership interests in DRPLP; (v) the transferee assumes and DRC and DRPLP remain responsible on a recourse basis for the obligations of the other Loan Parties to the extent set forth in the Loan Documents, including, but not by way of limitation under the Other Loan Party Agreement and the Hazardous Substances Remediation and Indemnification Agreement; and (vi) Debtor has provided prior written notice thereof to Secured Partner, which notice shall specify the identity of the transferees, then, such conditions having been satisfied, DRC shall have a right, from time to time to transfer general partnership interests in DRPLP to third parties or otherwise admit third parties as new general partners to DRPLP. 4.3 Replacement of Fixtures and Personalty. Debtor will not permit any of the Fixtures or Personalty (other than the Excluded Equipment and Vehicles) to be removed at any time from the Property without the prior written consent of Secured Party unless (i) such Fixtures or Personalty are actually replaced by articles of equal suitability and value owned by Debtor free and clear of any lien or security interest except such as may be approved in writing by Secured Party; (ii) such Fixtures or Personalty are no longer required for the operation of the Property in accordance with the Approved Manager Business Practices; or (iii) as otherwise may be permitted by the terms hereof. 4.4 No Cooperative or Condominium. Debtor shall not operate the Property or permit the Property to be operated, as a cooperative or condominium building or buildings in which the tenants or occupants participate in ownership, control, or management of the Property or any part thereof, as tenant stockholders or otherwise. 4.5 Name of the Mall. Debtor may not change the name of the enclosed regional shopping center on the Property from "Miami International Mall" without Secured Party's advance written consent. 4.6 Leasing and Agreements. A. All leases covering the Real Estate Security, now or in the future, shall be to creditworthy tenants on economic market terms in arms length transactions and shall be for initial terms of not less than five (5) years (Kiosk Leases may have initial terms of less than five (5) years and up to 30,000 square feet may be leased on terms of one year or less, such leases shall be called "Temporary Leases") and shall contain provisions that require tenants to contribute their pro rata share of taxes, insurance and all fixed and variable operating expenses and any common area fees or other charges under the COREA (Kiosk Leases and Temporary Leases need not include expense reimbursements) and shall provide that base rent for each year must be equal to or greater than base rent for the preceding year. Leases not meeting the above criteria shall be subject to Secured Party's advance written consent in addition to any such consent required by the provisions of Paragraph 4.6.B below. B. Debtor may engage in the following actions with respect to existing leases and new leases affecting the Real Estate Security: (1) Debtor may, without Secured Party's prior written consent terminate or accept the surrender of the lease of any tenant [other than Lane Bryant, its successors or assigns and any other tenant whose premises are larger than 7,500 rentable square feet] which is in default of its lease or is likely to go in default of such lease with the passage of time as a result of substandard sales for such operations; (2) Provided the amendment is commercially reasonable and in accordance with Approved Manager Business Practices, Debtor may, without Secured Party's advance written consent, (i) enter into minor noneconomic amendments with any size tenant; (ii) other than Lane Bryant, its successors or assigns and any other tenant whose premises are larger than 7,500 rentable square feet, enter into an amendment of the Lease of any tenant or terminate the lease of any tenant (but, in the case of a termination, only if a replacement tenant has signed a lease in accordance with the provisions of Paragraph 4.6.B(3) below; and (3) Debtor may enter into new bona-fide arm's length leases (or extend or renew existing leases) with tenants for premises of 7,500 rentable square feet or less without Secured Party's prior written consent provided such leases are on Debtor's standard form lease approved by Secured Party with no material modifications that materially increase the obligations of the landlord unless the modifications are commercially reasonable, are in accordance with Approved Manager Business Practices and do not include any specific asbestos, environmental, or hazardous substances indemnifications in favor of tenants unless such indemnifications, by their terms or pursuant to a Subordination and Non-Disturbance Agreement, would be extinguished by foreclosure, transfer by deed in lieu of foreclosure, or similar transfer of the Real Estate Security. Except as expressly provided above or after obtaining Secured Party's prior written consent], Debtor shall not (i) materially amend or modify any lease affecting the Real Estate Security; (ii) extend or renew (except in accordance with the existing lease provisions, if any) any lease affecting the Real Estate Security; (iii) terminate or accept the surrender of any lease affecting the Real Estate Security; or (iv) enter into any new lease of the Real Estate Security. C. Secured Party will, upon request of Debtor and subject to the provisions of Paragraph 9.22 herein which shall be applicable to such requests, enter into non-disturbance and recognition agreements with Tenants under any Key Tenant Lease approved by Secured Party or pursuant to the provisions of this Paragraph 4.6 deemed approved by Secured Party, or under any Lease approved by Secured Party or pursuant to the provisions of this Paragraph 4.6 deemed approved by Secured Party, in each case in form and substance satisfactory to Secured Party and Debtor. Such subordination or non-disturbance agreements shall be effected by agreement in recordable form and otherwise be in form and substance satisfactory to Debtor, Secured Party and their respective counsel. 4.7 COREA. Any material amendment, revision or modification to the COREA or other agreement between Debtor and an owner of an Anchor Store during the term of the Loan is subject to the prior written approval of Secured Party. Debtor shall pay Secured Party a nonrefundable $5,000.00 fee for processing requests for approval of material amendments, revisions or modifications (the material nature of the amendment, revision or modification to be reasonably determined by Secured Party) to cover Secured Party's services rendered in processing the material amendment, revision or modification. In addition, Debtor shall reimburse Secured Party for any reasonable out of pocket expenses and non-staff attorneys' fees associated with processing any request for approval of any material amendment, revision or modifications. Secured Party agrees that review of any such amendment, revision or modification will not be unreasonably delayed. Debtor will not consent to, or acquiesce in, any act or omission on the part of any signatory to the COREA if such act or omission would have a material adverse effect on the Real Estate Security. Debtor shall observe, perform, discharge, duly and punctually, all and singular, any material obligation, term, covenant condition or warranty under the COREA on the part of Debtor to be kept, observed and performed (and give prompt notice to Secured Party of any failure on the part of Debtor or any other signatory to the COREA to observe, perform and discharge the same) within any applicable notice and cure period thereby. The COREA shall remain in full force and effect during the entire term of the Loan. 4.8 [Intentionally omitted] ARTICLE 5 Casualties and Condemnation 5.1 Insurance and Condemnation Proceeds. A. Debtor will notify Secured Party in writing promptly after any loss or damage of $100,000.00 or more caused by fire or other casualty to all or any part of the Mortgaged Premises, and prior to the making of any repairs thereto. Debtor will furnish to Secured Party within seventy-five (75) days after such loss or damage of $2,500,000.00 or more (i) preliminary plans and specifications for repair and reconstruction of the Mortgaged Premises (the "Preliminary Plans and Specifications"); and (ii) evidence reasonably satisfactory to Secured Party (1) of the cost of repair or reconstruction in accordance with the Preliminary Plans and Specifications, (2) that sufficient funds are available or will be available from the operation of the Mortgaged Premises and/or committed for the benefit of such restoration, including insurance proceeds, funds provided by the Debtor, payment and performance bond, or otherwise, to complete such repair or reconstruction, and (3) that such repair or reconstruction may be completed in accordance with all applicable Laws and Restrictions within the time frame described in Paragraph 5.1.C(vi) herein and that all necessary permits and approvals have been or will be obtained. B. All insurance and condemnation proceeds on account of any damage to the Mortgaged Premises in excess of $250,000.00 (or such smaller amount as the COREA requires to be escrowed) shall be payable to, and deposited with, Secured Party. Secured Party, at its sole option, may (i) apply such insurance and condemnation proceeds in payment of the indebtedness under the Loan Documents without payment of any Prepayment Premium or in satisfaction of any other obligation under the Loan Documents in such order as Secured Party may determine; (ii) use such insurance and condemnation proceeds to repair or reconstruct the Mortgaged Premises; (iii) release such insurance and condemnation proceeds to Debtor for repair or reconstruction of the Mortgaged Premises in accordance with the procedures described in Paragraph 5.1.E herein; or (iv) divide such proceeds in any manner among any such application, use or release. No such application, use or release shall, however, extend or postpone the due date of any installments under the Note which shall be modified so that the modified even monthly installments of principal and interest at the rate of interest in the Note amortize the principal balance of the Loan, after such application, over twenty- five (25) years thereafter (but without changing the maturity date or other provisions of the Loan) or cure or waive any Event of Default or notice of Event of Default under the Loan Documents or invalidate any act done pursuant to such notice. C. Notwithstanding the provisions of Paragraphs 5.1.B or 5.2 herein, if all or any part of the Mortgaged Premises is damaged or destroyed or any part of the Mortgaged Premises is taken by any public or quasi-public authority through condemnation, eminent domain, deed in lieu thereof, or otherwise, Secured Party shall (A) if the loss or damage is under $250,000.00 in amount, pay over said proceeds to Debtor for repair and restoration of the Mortgaged Premises; (B) if the loss or damage is $250,000.00 or over in amount but is under $2,500,000.00 in amount, make the net amount of all insurance proceeds and condemnation awards received by Secured Party, after deduction of Secured Party's reasonable out-of-pocket costs and expenses, if any, in collection of same available to Debtor for the repair and restoration of the Mortgaged Premises (or so much thereof as was not so condemned) pursuant to the procedures described in Paragraph 5.1.E herein except no architect or plans and specifications shall be required, any architect certification shall be replaced by a Debtor's certification of the completion of the work described in the certification; and (C) if the loss or damage is $2,500,000.00 or greater in amount, make the net amount of all insurance proceeds and condemnation awards received by Secured Party after deduction of Secured Party's reasonable out-of-pocket costs and expenses, if any, in collection of same, and out-of-pocket costs associated with Secured Party's review of the Preliminary Plans and Specifications and other out-of-pocket costs associated with disbursement of such proceeds (the "Net Proceeds"), available for the repair and reconstruction of the Mortgaged Premises (or so much thereof as was not condemned) pursuant to the procedures described in Paragraph 5.1.E herein, provided that (i) no Event of Default or event which, with the giving of notice or the passage of time, or both, would constitute an Event of Default shall have occurred and shall be continuing under any of the Loan Documents; (ii) Debtor has complied with the provisions of Paragraph 5.1.A herein and Secured Party has approved the Preliminary Plans and Specifications; (iii) subject to the provisions of the COREA, Debtor shall proceed (as promptly as is practicable after the date of any such damage or destruction or of any such taking of any part of the Mortgaged Premises (the "Occurrence"), but in no event later than three (3) months after the occurrence) with the reconstruction of the Mortgaged Premises as nearly as possible to the condition it was in immediately prior to the Occurrence and in accordance with the Preliminary Plans and Specifications (and any changes thereto approved by Secured Party); (iv) Secured Party shall be satisfied that no leases with tenants which are not Key Tenants and no Key Tenant (other than Key Tenants occupying not more than an aggregate of 10,000 rentable square feet) with an aggregate rentable square footage for such Key Tenants and tenants who are not Key Tenants of ten percent (10%) or more of the total rentable square feet contained in the Mortgaged Premises prior to the occurrence shall be terminated as a result of the Occurrence; (v) Secured Party shall be satisfied that not more than one (1) Anchor Store shall cease operating under the terms of the COREA as a result of the Occurrence and that there are at least four (4) remaining Anchor Stores operating regardless of the Occurrence; (vi) Secured Party shall be satisfied that such reconstruction can be completed no later than eighteen (18) months after the Occurrence and at least one (1) year before the maturity of the Loan; (vii) Secured Party shall be satisfied that the reconstruction can be completed at a cost which does not exceed the Net Proceeds or, in the event the cost of such restoration exceeds the Net Proceeds, Debtor shall have satisfied the requirements set forth in Paragraph 5.1.E(6)(i) or Paragraph 5.1.E(6)(ii) herein; (viii) Secured Party shall be satisfied that Debtor (whether with rental loss insurance proceeds or otherwise) will continue to be able to timely pay all payments as they become due on the indebtedness under the Loan Documents during such period of repair and reconstruction; (ix) Secured Party determines that repair or reconstruction is economically feasible, that the loan to value ratio of the repaired or reconstructed Mortgaged Premises will be 65% or less and that the Mortgaged Premises have generated Net Operating Income, as defined in Paragraph 4.2.B(4) herein in the amount required as a One Time Transfer Condition in Paragraph 4.2.B(3) (ff) herein, for the Required Periods, as defined in Paragraph 4.2.B(4) herein (except that the date of the loss, destruction or condemnation, as the case may be, shall be used in lieu of the date of Debtor's written request for approval of the Transfer) with Debtor to timely submit to Secured Party the documentation of the Net Operating Income for such Required Periods (including the budget) as set forth in Paragraph 4.2.B herein; (x) the insurer has not denied liability to any named insured and such denial would not prevent the satisfaction of any other condition or requirement set forth in this Paragraph 5.1.C and (xi) Debtor shall have entered into a general construction contract acceptable in all respects to Secured Party for completion of the repair or reconstruction, which contract must include provision for a retainage of not less than ten percent (10%) until full completion of the repair or reconstruction. D. Provided that no Event of Default or event that with the passage of time or the giving of notice or both would result in an Event of Default shall have occurred and be continuing, Debtor shall have the sole responsibility for adjusting all insurance claims of Two Million Five Hundred Thousand Dollars ($2,500,000.00) or less, so long as Debtor keeps Secured Party advised of the progress and amount of such adjustment. Debtor and Secured Party shall jointly adjust all insurance claims in excess of Two Million Five Hundred Thousand Dollars ($2,500,000.00). E. The Net Proceeds and any additional funds deposited by Debtor with Secured Party shall be held by Secured Party until disbursement in an interest bearing special account and shall constitute additional security for the Loan. Debtor shall execute, deliver, file and/or record, at its own expense, such documents and instruments as Secured Party deems necessary or advisable to grant to Secured Party a perfected, first priority security interest in the Net Proceeds and such additional funds. Secured Party shall pay the Net Proceeds to the Debtor from time to time during the course of the restoration, subject to the following terms and conditions: (1) The work shall be administered and overseen by an architect approved by Secured Party ("Architect"). Complete copies of the final plans and specifications for the work (the "Final Plans and Specifications") , approved by all governmental authorities whose approval is required, and bearing the sealed and signed approval thereof by the Architect and accompanied by the Architect's signed estimate of the entire cost of completing the work, shall be delivered to Secured Party; (2) Each request for payments shall be made upon seven (7) days' prior notice to Secured Party and shall be accompanied by a certificate to be made by the Architect stating that (i) all of the work completed has been done in compliance with the Plans and Specifications, as approved by Secured Party; (ii) the sum requested is justly required to reimburse Debtor for payments by Debtor to, or is justly due to, the contractor, subcontractors, materialmen, laborers, engineers, architects or other persons rendering services and materials for the work (giving a brief description of such services and materials) and, when added to all sums previously paid out by Secured Party, does not exceed the value of the work done to the date of such certificate and (iii) the amount of such proceeds remaining with Secured Party are sufficient on completion of the work to pay for the same in full (giving in such reasonable detail as Secured Party may require an estimate of the cost of such completion); (3) Each request shall be accompanied by conditional or unconditional waivers of lien, as appropriate, satisfactory to Secured Party covering that part of the work for which payment or reimbursement is being requested and, if required by Secured Party, by a search prepared by a title company satisfactory to Secured Party, that there has not been filed with respect to the Mortgaged Premises any mechanics', materialmen's or other lien; (4) The request for any payment after the work has been completed shall be accompanied by a copy of any certificate or certificates required by any Laws and Restrictions for legal occupancy of the Improvements; (5) Debtor shall deliver to Secured Party certified or photostatic copies of all permits and approvals required by any Laws and Restrictions in connection with the commencement and conduct of the work; and (6) If at any time the sum (the "Adjusted Net Proceeds") of (i) the undisbursed balance of the Net Proceeds; plus (ii) the net income (after debt service) in which Secured Party has a security interest and which Secured Party is satisfied will be forthcoming during the period of time reasonably estimated by Secured Party as required for completion of the restoration, shall not, in Secured Party's opinion, be sufficient to pay in full the balance of the costs which will be incurred in connection with the restoration and pay or perform the obligations of Debtor under the Loan Documents as and when due during the restoration period, Debtor shall, prior to receiving any further disbursement, either (1) complete such portion of the restoration as shall be sufficient to render the Adjusted Net Proceeds sufficient to complete the restoration; (2) deposit the deficiency with Secured Party before any further disbursement of the Net Proceeds shall be made, which deficiency deposit shall be held by Secured Party and shall be disbursed on the same conditions applicable to the Net Proceeds or (3) deliver assurances satisfactory to Secured Party that all costs of the restoration in excess of the Adjusted Net Proceeds will be paid in full as the same become due and payable. Debtor shall remit to Secured Party the balance, if any, for any such deficiency deposit remaining after completion of the restoration. F. Notwithstanding anything to the contrary contained herein, or in any of the insurance policies, all proceeds paid to Debtor under such policies shall immediately be delivered to Secured Party if they are in the amount of $250,000.00 or more. If the Net Proceeds exceed the costs of completion for the restoration of the Mortgaged Premises, such excess proceeds shall, provided no Event of Default or event that with the passage of time or the giving of notice or both would result in an Event of Default, be paid over to Debtor, and otherwise shall belong and be retained by and/or paid over to Secured Party to be applied against the indebtedness of Debtor under the Loan Documents without payment of any Prepayment Premium. G. Notwithstanding anything to the contrary contained herein, Secured Party will make the Net Proceeds available for repair and restoration when and as required by the COREA, but, in all events, when the loss or damage is $250,000.00 or more in amount (or such smaller amount as the COREA requires to be escrowed), Secured Party shall be the disbursement Trustee. Secured Party's obligation to make such Net Proceeds available for repair or restoration when and as required by the COREA is further subject to Debtor's satisfaction of the following conditions which shall be applicable as of the time the Net Proceeds are to be made so available pursuant to the provisions of the COREA: (i) the COREA is in full force and effect; (ii) there is no Event of Default under any of the Loan Documents or event that with the passage of time or the giving of notice or both would result in an Event of Default under any of the Loan Documents; (iii) Debtor is not in default under any of the terms, covenants and conditions of the COREA and there is no event that with the passage of time or the giving of notice or both would result in a default by Debtor under the COREA; (iv) that either (x) the Debt Service Coverage is 2.00 to 1.00 [the Debt Service Coverage shall be computed by dividing the Net Operating Income, as defined in Paragraph 4.2.B(4) herein (except the Required Periods shall be the twelve month period after the date of loss, destruction or condemnation, as the case may be) by the required payments of principal and interest under the Loan during the Required Periods with the quotient to be at least 2.00] and the loan to value ratio of the reconstructed Mortgaged Premises will be 65% or less unless Secured Party elects, in its sole discretion (without regard to the Standard of Conduct), to waive, in writing, such a loan to value ratio requirement and unless Secured Party so waives such loan to value ratio requirement, Debtor shall have the right to make principal prepayments, without the Prepayment Premium being applicable thereto, in the amount of the lesser of Ten Million Dollars ($10,000,000.00) or the amount necessary to achieve a 65% loan to value ratio (any such prepayment together with any additional principal payments, and the Prepayment Premium applicable thereto, necessary to meet the 65% loan to value ratio, are to be made as a condition of making the Net Proceeds so available) or (y) all then existing Leases affected in any way by such damage or destruction shall continue in full force and effect or, alternatively, substitute Leases have been entered into by Debtor which, in the discretion of Secured Party, adequately secures the Indebtedness and Obligations; (v) that Debtor shall first be given satisfactory proof that such Improvements have been fully restored or that by the expenditure of such money will be fully restored, free and clear of all liens, except as to the lien of this Security Instrument; (vi) that in the event such Net Proceeds shall be insufficient to restore or rebuild the said Improvements, Debtor shall deposit promptly with Secured Party funds which, together with the Net Proceeds, shall be sufficient to restore and rebuild the said Improvements; (vii) that in the event Debtor shall fail, within a reasonable time, subject to delays beyond its control, to restore or rebuild the said Improvements, then Secured Party, at its option, may restore or rebuild the said Improvements for or on behalf of the Debtor and for such purpose may do all necessary acts; (viii) that waiver of the right of subrogation shall be obtained from any insurer under such policies of insurance who, at that time, claims that no liability exists as to the Debtor or the then owner or the assured under such policies; (ix) that the excess of said insurance proceeds above the amount necessary to complete such restoration shall be applied as provided in Paragraph 5.1.F herein; (x) under no circumstances shall Secured Party become personally liable for the fulfillment of the terms, covenants and conditions contained in the COREA, or any other Leases nor obligated to take any action to restore the said Improvements; (xi) all insurance proceeds held by Secured Party or funds deposited by Debtor under Clause (vi) above shall be held as provided in Paragraph 5.1.E above in an interest bearing special account which shall constitute additional security for the Loan and shall be applied as set forth above in this Paragraph 5.1.G, in Paragraph 5.1.E and in Paragraph 5.1.F; and (xii) Debtor covenants and agrees that in case of damage to or destruction of the Mortgaged Premises by fire or otherwise, if Secured Party makes the Net Proceeds available pursuant to this Paragraph 5.1.G, then Debtor will promptly, at Debtor's sole cost and expense, restore, repair, replace, rebuild or alter the Mortgaged Premises as nearly as possible to the condition the same was in immediately prior to such damage or destruction; such restoration, repairs, replacements, rebuilding or alterations shall be commenced promptly and prosecuted with reasonable diligence, subject to unavoidable delays. 5.2 Additional Provisions Relating to Condemnation. Debtor, promptly upon obtaining knowledge of the commencement of any proceedings for the condemnation of the entire Mortgaged Premises or any part thereof, will notify Secured Party of the pendency of such proceedings if the loss or damage is of $100,000.00 or more. Secured Party may participate in any such proceedings and Debtor from time to time will deliver to Secured Party all instruments requested by Secured Party to permit such participation. Debtor shall have sole responsibility for the handling of all such loss or damage condemnation claims of $2,500,000.00 or less, so long as Debtor keeps Secured Party advised of the progress and the amount of the awards with Debtor and Secured Party to have joint authority with respect to such loss or damage condemnation claims of $2,500,000.00 or more. In the event of such condemnation proceedings, the award or compensation payable is hereby assigned to and shall be paid to Secured Party. Secured Party shall be under no obligation to question the amount of any such award or compensation and may accept the same in the amount in which the same shall be paid. In any such condemnation proceedings the Secured Party may be represented by counsel selected by the Secured Party, the reasonable cost of such counsel to be borne by Debtor. The proceeds of any award or compensation so received by Secured Party shall be paid over to Debtor for repair or restoration of the Mortgaged Premises (A) if the loss or damage is under $250,000.00 in amount (or such smaller amount as the COREA require to be escrowed); (B) if the loss or damage is $250,000.00 or more in amount but less than $2,500,000.00 in amount it shall be held and applied by Secured Party as Net Proceeds of insurance in such amounts pursuant to the provisions of Paragraph 5.1.C(B) herein; and (C) if the loss or damage is of $2,500,000.00 in amount or more, it shall be applied by Secured Party as Net Proceeds of insurance in such amounts pursuant to the provisions of Paragraph 5.1.C(C) herein. The provisions of Paragraph 5.1.G herein shall be applicable to such condemnation proceeds. 5.3 [Intentionally Omitted] ARTICLE 6 Events of Default and Remedies of Secured Party 6.1 Events of Default. A. If one or more of the following events shall have occurred and be continuing: (1) Debtor shall fail to pay within five (5) days of the notice of failure to pay any part of the Indebtedness or make any other payment required by the Loan Documents when due; provided however, if Secured Party shall give two (2) such notices of a monetary default in any twelve (12) month period, Debtor shall have no further right to any notice of any such monetary default; (2) Debtor shall fail to timely observe, perform or discharge any nonmonetary Obligation contained in any of the Loan Documents or, if such failure would have a material and adverse effect upon the Property, in any agreement relating to the Property on its part to be performed or observed and, except as to failures covered by Paragraph 6.1-A(1), Paragraph 6.1.A(4), Paragraph 6l.A(6), Paragraph 6.1.A(9) and Paragraph 6.1.B where such thirty (30) day grace period shall not be applicable, any such failure shall remain unremedied for thirty (30) days (the "Grace Period") after notice to Debtor of the occurrence of such failure; provided, however, if the default occurs by reason of a cross-default between this Instrument, the Note or any Other Loan Document, no duplicitous notice or cure period shall be required and provided further, if the default is, in Secured Party's reasonable judgment, of such a nature that it cannot be cured within thirty (30) days, then the Grace Period may be extended by such additional time as Secured Party may reasonably approve in writing after receipt by Secured Party within such thirty (30) day period of a written request by Debtor for such an extension of the Grace Period; (3) Debtor, as lessor or sublessor, as the case may be, shall assign the rents or income of the Property or any part thereof (other than to Secured Party) without first obtaining the written consent of Secured Party except as incident to a transfer of the fee simple interest in the Property which is permitted under Paragraph 4.2 herein; (4) Debtor shall fail to provide or maintain the insurance coverages required by Paragraph 3.2 herein and such failure shall remain unremedied for five (5) days after notice to Debtor of the occurrence of such failure; (5) Reserved. (6) Default by Debtor under any Key Tenant Lease or the COREA, if such default would have a material and adverse effect upon Debtor, the Property, the interest of Debtor or Secured Party therein, or the lien or security interest created by this Instrument (the termination of the COREA will be deemed to have such a material adverse effect); provided, however, that with respect to a default by Debtor thereunder, Secured Party shall not declare an Event of Default with respect to such default if and for so long as Debtor commences and is diligently pursuing the cure of such default and the applicable grace or cure period under such document shall not have expired; (7) Any representation or warranty made by Debtor in, under or pursuant to the Loan Documents was false or misleading in any material respect as of the date(s) on which such representation or warranty was made or deemed remade; (8) Debtor shall violate Paragraph 4.2 of this Instrument and/or, except as expressly permitted by this Instrument, any claim or lien shall be filed against the Property or any part thereof, whether or not such claim or lien shall be prior to this Instrument, which shall be maintained for a period of ninety (90) days without discharge, satisfaction or adequate bonding or other Security in accordance with the terms of this Instrument; (9) Default by Debtor, after the expiration of all applicable grace or cure periods, under the Hazardous Substances Remediation and Indemnification Agreement or any other Loan Document; or (10) Any of the Loan Documents, at any time after their respective execution and delivery and for any reason, other than an act or omission of Secured Party, shall cease to be in full force and. effect or be declared null and void, or, as the case may be, shall cease to be valid and subsisting liens and/or valid and perfected security interests in and to the Property; THEN and in any such event Secured Party may, if such default shall not have been previously cured by Debtor, by written notice delivered to Debtor, declare Debtor to be in default. Upon the occurrence of such event, the same shall constitute an event of default (an "Event of Default"). B. Additionally, it shall constitute an Event of Default hereunder without the requirement of any notice if one or more of the following events shall have occurred and be continuing: (1) Any Other Loan Party generally fails to pay its debts as they become due or admits in writing its inability to pay its debts, or makes a general assignment for the benefit of creditors; (2) Any Other Loan Party commences any case, proceeding or other action seeking reorganization, arrangement, adjustment, liquidation, dissolution or composition of it or its debts under any law relating to bankruptcy, insolvency, reorganization or relief of debtors, or seeks to have an order for relief entered against it as debtor, or seeks appointment of a receiver, trustee, custodian or other similar official for it or for all of any substantial part of its property (collectively, a "Proceeding"); (3) Any Other Loan Party takes any action to authorize any of the actions set forth above in clause (2); (4) Any Proceeding is commenced against any Other Loan Party and such Proceeding remains undismissed for an aggregate of ninety (90) days (whether or not consecutive); or (5) A receiver, trustee or liquidator shall have been appointed with respect to (i) any Other Loan Party; or (ii) all or any substantial part of the property of any Other Loan Party. C. Upon the occurrence of any Event of Default, Secured Party may at any time declare all of the Indebtedness to be due and payable and the same shall thereupon become immediately due and payable, together with any prepayment fee due in accordance with the terms of the Note, without any further presentment, demand, protest or notice of any kind. Secured Party may, in its sole discretion, also do any of the following: (1) in person, by agent, or by a Receiver, and Without regard to the adequacy of security, the solvency of Debtor or the condition of the Property, enter upon and take possession of the Property, or any part thereof, in its own name and do any acts which Secured Party deems necessary to preserve the value, marketability or rentability of the Property; sue for or otherwise collect the rents, issues and profits therefrom, including those past due and unpaid, and apply the same, less costs and expenses of operation and collection, including reasonable attorneys' fees, against the Indebtedness, all in such order as Secured Party may determine. The entering upon and taking possession of said property, the collection of such rents, issues and profits and the application thereof as aforesaid shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice; (2) commence an action to foreclose this Instrument in the manner provided under this Instrument or by law; or (3) with respect to any Personalty, proceed as to both the real and personal property in accordance with Secured Party's rights and remedies in respect of the Land, or proceed to sell said Personalty separately and without regard to the Land in accordance with Secured Party's rights and remedies as to personal property. D. On or after the occurrence of an Event of Default, Secured Party may (in its sole and absolute discretion), but in no event shall Secured Party be obligated to, expressly waive in writing such Event of Default (a "Default Waiver"). In the event Secured Party executes such a Default Waiver, Debtor's rights, duties, and obligations under the Loan Documents shall thereafter be exercised and/or performed as if no Event of Default shall have occurred; provided, however that such Default Waiver shall not (i) affect any of the rights or remedies exercised by Secured Party hereunder, at law or in equity on or after the occurrence of such Event of Default but prior to the effective date of such Default Waiver (including, without limitation, collection and receipt of interest on the Indebtedness at the Secondary Interest Rate accruing prior to such Default Waiver); (ii) thereafter affect any rights or remedies of Secured Party contained in the Loan Documents, at law or in equity; and (iii) constitute a waiver with respect to any subsequent Event of Default. The provisions of Paragraph 9.34 herein shall not apply to the terms and provisions of this Paragraph 6.1.D. 6.2 Power of Sale. A. To the extent permitted by applicable law, should Secured Party elect to foreclose by exercise of the power of sale herein contained, notice of default having been given as then required by law, and after lapse of such time as may then be required by law, after complying with all conditions precedent to a sale pursuant to the power of sale, Secured Party shall sell the Property at the time and place of sale fixed by it in its notice of sale, either as a whole or in separate parcels as Secured Party shall determine, and in such order as Secured Party may determine, at public auction to the highest bidder. Secured Party may, in its sole discretion, designate the order in which the Property shall be offered for sale or sold through a single sale or through two or more successive sales, or in any other manner Secured Party deems to be in its best interest. If Secured Party elects more than one sale or other disposition of the Property, Secured Party may at its option cause the same to be conducted simultaneously or successively, on the same day or at such different days or times and in such order as Secured Party may deem to be in its best interests, and no such sale shall terminate or otherwise affect the lien of this Instrument on any part of the Property not then sold until all Indebtedness secured hereby has been fully paid. If Secured Party elects to dispose of the Property through more than one sale, Debtor shall pay the costs and expenses of each such sale of its interest in the Property and of any proceedings where the same may be made. Secured Party may postpone the sale of all or any part of the Property by public announcement at such time and place of sale, and from time to time thereafter may postpone such sale by public announcement at the time fixed by the preceding postponement, and without further notice make such sale at the time fixed by the last postponement; or Secured Party may, in its discretion, give a new notice of sale. Secured Party may rescind any such notice of default at any time before a sale by executing a notice of rescission and recording the same. Such notice shall constitute a cancellation of any prior declaration of default and demand for sale and of any acceleration of maturity of Indebtedness affected by any prior declaration or notice of default. The exercise by Secured Party of the right of rescission shall not constitute a waiver of any default then existing or subsequently occurring, or impair the right of Secured Party to execute other declarations of default and demand for sale, or notices of default and of election to cause the Property to be sold, nor otherwise affect the Note or this Instrument, or any of the rights, obligations or remedies of Secured Party hereunder. After such sale, Secured Party shall deliver to such purchaser its deed conveying the property so sold, but without any covenant or warranty, express or implied. The recitals in such deed of any matters or facts shall be conclusive proof of the truthfulness thereof. Any Person, including Debtor or Secured Party, may purchase at such sale. If allowed by law, Secured Party, if it is the purchaser, may turn in the Note at the amount owing thereon toward payment of the purchase price (or for endorsement of the purchase price as a payment on the Note if the amount owing thereon exceeds the purchase price). Debtor hereby expressly waives any right of redemption after sale that Debtor may have at the time of sale or that may apply to the sale. B. Secured Party, upon such sale, shall make (without any covenant or warranty, express or implied), execute and after due payment made, deliver to the purchaser, its heirs or assigns, a deed or other record of interest, as the case may be, in and to the Property so sold that shall convey to the purchaser all the title and interest of Debtor in the Property (or part thereof sold), and shall apply the proceeds of such sale in payment, first, of the expenses of such sale, including reasonable attorneys' fees, that shall become due upon any default made by Debtor, and also such sums, if any, as Secured Party shall have paid for procuring a search of the title to the Property, or any part thereof, subsequent to the execution of this Instrument; and in payment, second, of the Obligations then remaining unpaid, and the amount of all other monies with interest thereon agreed or provided to be paid by Debtor; and the balance or surplus of such proceeds of sale Secured Party shall pay to Debtor, its successors or assigns as their interest may appear. 6.3 Proof of Default. In the event of a sale of the Property, or any part thereof, and the execution of a deed therefore, the recital therein of default, and of recording notice of default and election of sale, and of compliance with all conditions precedent to sale pursuant to the power of sale, shall be conclusive proof of compliance with such conditions precedent, and that the sale was regularly and validly made on due and proper demand by Secured Party, its successors or assigns. Any such deed or deeds with such recitals therein shall be effective and conclusive against Debtor, its successors and assigns, and all other Persons. The receipt for the purchase money recited or contained in any deed executed to the purchaser as aforesaid shall be sufficient discharge to such purchaser from all obligations to see to the proper application of the purchase money. 6.4 Protection of Security. If an Event of Default shall have occurred and be continuing, then Secured Party, but without obligation so to do and without notice to or demand upon Debtor and without releasing Debtor from any obligations or defaults hereunder, may: perform any act in such manner and to such extent as either may deem necessary to protect the security hereof, Secured Party being authorized to enter upon the Property for such purpose; appear in and defend any action or proceeding purporting to affect, in any manner whatsoever, the Obligations or the Indebtedness, the security hereof or the rights or powers of Secured Party; pay, purchase or compromise any encumbrance, charge or lien that in the judgment of Secured Party is prior or superior hereto; and in exercising any such powers, pay necessary expenses, employ counsel and pay reasonable attorneys' fees. Debtor agrees that all sums expended by Secured Party pursuant to this paragraph, together with interest at the Secondary Interest Rate from the date of expenditure by Secured Party, shall be added to the principal amount of the Indebtedness secured by the Loan Documents and this Instrument and shall be payable by Debtor to Secured Party upon demand. 6.5 Receiver. If an Event of Default shall have occurred and be continuing, Secured Party, as a matter of strict right and without notice to Debtor or anyone claiming under Debtor, and without regard to the then value of the Property, shall have the right to apply ex parte to any court having jurisdiction to appoint a Receiver to enter upon and take possession of the Property, and Debtor hereby waives notice of any application therefor, provided a hearing to confirm such appointment with notice to Debtor is set within the time required by law. Any such Receiver shall have all the powers and duties of Receivers in like or similar cases and all the powers and duties of Secured Party in case of entry as provided in this Instrument, and shall continue as such and exercise all such powers until the date of confirmation of sale, unless such Receivership is sooner terminated. 6.6 Remedies Cumulative. All remedies of Secured Party provided for herein are cumulative and shall be in addition to any and all other rights and remedies provided in the other Loan Documents or by law, including any right of offset. The exercise of any right or remedy by Secured Party hereunder shall not in any way constitute a cure or waiver of default hereunder or under the Loan Documents, or invalidate any act done pursuant to any notice of default, or prejudice Secured Party in the exercise of any of its rights hereunder or under the Loan Documents. 6.7 Curing of Defaults. If Debtor shall at any time fail to perform or comply with any of the terms, covenants and conditions required on Debtor's part to be performed and complied with under this Instrument, any of the other Loan Documents or any other agreement that, under the terms of this Instrument, Debtor is required to perform, then Secured Party, upon five (5) business days' prior written notice (or with subsequent notice if immediate action on the part of Secured Party or its agent is required to protect the Property or the Secured Party's security for the Loan), and without waiving or releasing Debtor from any of the Obligations, may, in its sole discretion: (i)make any payments hereunder or thereunder payable by Debtor and take out, pay for and maintain any of the insurance policies provided for herein or therein; and/or (ii) after the expiration of any applicable grace period and subject to Debtor's rights to contest certain obligations specifically granted hereby, perform any such other acts thereunder on the part of Debtor to be performed and enter upon the Property for such purpose. All sums so paid out of Secured Party's own funds and all reasonable costs and expenses incurred and paid by Secured Party in connection with the performance of any such act, together with interest on unpaid balances thereof at the Secondary Interest Rate from the respective dates of Secured Party's making of each such payment, shall be added to the principal of the Indebtedness, shall be secured by the Loan Documents and by the lien of this Instrument, prior to any right, title or interest in or claim upon the Property attaching or accruing subsequent to the lien of this Instrument, and shall be payable by Debtor to Secured Party on demand. ARTICLE 7 Security Agreement and Fixture Filing 7.1 Grant of Security Interest. Debtor grants to Secured Party a security interest in all right, title and interest of Debtor, in and to all Fixtures and Personalty exclusive of Tenant Fixtures and Improvements now owned or hereafter acquired or leased by or on behalf of Debtor (collectively, the "Collateral"). As used herein, the term "Personalty" shall mean all property (other than Fixtures and Excluded Equipment and Vehicles) now owned or hereafter acquired or leased by or on behalf of Debtor and now or hereafter installed in, affixed to, placed upon, located in, upon or about, or necessary for or connected with or used in connection with, the Property or the Improvements or any use or proposed use thereof, including, without limitation, all furniture, furnishings, fixtures, vehicles and equipment necessary for the full operation of the Real Estate Security as a first class enclosed regional shopping center and related operations and (i) any licenses, governmental authorizations or permits now or hereafter obtained by or for the benefit of Debtor pertaining to the Property or the operation thereof, to the extent they are legally assignable and/or may be encumbered, and the Trademarks; (ii) all machinery, equipment, appliances and fixtures for any function, including, without limitation, for generating or distributing air, water, heat, electricity, light, fuel or refrigeration, or for ventilating or sanitary purposes or for the exclusion of vermin or insects, or for the removal of dust, refuse or garbage; (iii) all wall safes, vaults, built-in furniture and installations, shelving, lockers, partitions and doors; (iv) all elevators and related equipment, including, without limitation, motors; (v) all window coverings and associated hardware, and awnings; (vi) all floor coverings; (vii) all plumbing equipment and fixtures, including, without limitation, sinks, basins, pipes, faucets, water closets, heating units, disposals, water heaters and incinerators; (viii) all fire hoses and brackets and boxes for the same, and all fire sprinklers; (ix) all kitchen equipment and fixtures; (x) all furniture, fixtures and furnishings, including, without limitation, all light fixtures; (xi) all telephone, sound, security and communications systems; (xii) all building materials, supplies and equipment now or hereafter delivered to the Property; (xiii) all works of art, including, without limitation, all paintings, wall hangings, fountains and sculptures; (xiv) all office equipment, including, without limitation, all computers, computer systems, hardware and software, access codes, access keys, computer programs and file names; (xv) all inventories and supplies; (xvi) all security and cleaning deposits collected from any Tenants or lessees of any part of the Property and all deposits collected from purchasers pursuant to contracts for sale of the Property or any portion of the Property subject to the rights of third parties to have the same applied pursuant to the terms of the operative agreement or by law; (xvii) all refunds of deposits paid to secure utility service and all rent payable to Debtor in connection with the use of any of the Personalty; (xviii) subject to the provisions of this Instrument: (a) any fire and/or builder's risk insurance policy, or any policy insuring the Property against any other perils, together with all proceeds therefrom and prepaid premiums thereon (including, limitation, any interest the Debtor may have in any insurance proceeds paid with respect to any insurance policies procured by lessees of the Property or any portion thereof), (b) all causes of action and recoveries now or hereafter existing for any loss or diminution in value of the Property, (c) all awards made in eminent domain proceedings, or purchase in lieu thereof, made with respect to the Property, and (d) any compensation, award or payment or relief given by any governmental agency or other source because of damage to the Property resulting from earthquake, flood, windstorm or any emergency or any other event or circumstance, the specific enumerations herein not excluding the general; (xix) all contract rights of the undersigned in the COREA, construction contracts, bonds or agreements for purchase and sale of the Property; (xx) the Debtor's interest in the Impound Account; (xxi) all property in which Debtor now has or hereafter acquires any interest which now or hereafter is in the possession of Secured Party or which has been or is deposited or left with Secured Party by or for the account of the Debtor, including, without limitation, negotiable documents, chattel paper, instruments, sums delivered by the Debtor to the Secured Party and retained as security for the payment and performance of the Obligations, money, deposit accounts and goods of every description; (xxii) all inventory, accounts, including without limitation, deposit accounts, contract rights, instruments, general intangibles, notes, drafts, acceptances and other obligations of any kind now or hereafter existing arising out of or in connection with the operation or development of the Property, and all security agreements, leases, and other contracts securing or otherwise relating to any such accounts; (xxiii) all motor vehicles, trailers, carts, flatbeds and other transportation equipment; (xxiv) all other goods or other personal property of any type or nature whatsoever, and wherever located, related in any way to or used or useful in any manner in connection with the operation, use, occupancy or management of the Property; (xxv) all plans and specifications for the Improvements; and (xxvi) all present and future attachments, accessions, replacements, substitutions and additions to or for any of the foregoing, and the cash and noncash proceeds thereof, but excluding any and all trade fixtures, tenant improvements, contractor's tools and equipment and personal property located on the Property and owned by Tenants, independent contractors, or others, but not owned by or on behalf of Debtor, provided that such trade fixtures and/or such tenant improvements are removed from the Property within thirty (30) days from the expiration of the lease with any tenant owning such trade fixtures and/or such tenant improvements unless such lease provides for a longer period of time. 7.2 Representations, Warranties and Covenants. A. Secured Party shall have no duty of care with respect to the Collateral except that it shall exercise reasonable care with respect to Collateral in its custody and shall be deemed to have exercised reasonable care if such Collateral is accorded treatment substantially equal to that accorded its own property, or if it takes such action as Debtor may reasonably request in writing. No failure to comply with any such request nor any omission to do any such act requested by Debtor shall, in and of itself, be deemed a failure to exercise reasonable care, nor shall Secured Party's failure to take steps to preserve rights against any parties or property be deemed a failure to have exercised reasonable care with respect to Collateral in its custody. B. In addition to the rights and security interests elsewhere herein set forth, Secured Party may, at its option, at any time an Event of Default shall have occurred and be continuing (no right to reinstate the Loan or to cure any Event of Default is implied), and with or without notice to Debtor, appropriate and apply to the payment or reduction, either in whole or in part, of the amount owing on the Note, whether or not then due, any or all monies now or hereafter in Secured Party's possession on deposit or otherwise, to the credit of or belonging to Debtor, it being understood and agreed that Secured Party shall not be obligated to assert or enforce any rights or security interest hereunder to take any action in reference thereto, and that it may in its discretion at any time relinquish its rights as to particular Collateral hereunder without thereby affecting or invalidating its rights hereunder as to all or any other Collateral. C. Debtor further agrees and covenants that: if Secured Party so demands in writing at any time after an Event of Default and be continuing (no right to reinstate the Loan or to cure any Event of Default is implied), all chattel paper, instruments, and documents constituting Collateral shall be delivered to Secured Party at the time and place and in the manner specified in the demand; subject to Paragraph 3.7 herein, if Secured Party so requests, Debtor shall execute and deliver to Secured Party any notice, statement, instrument, document, agreement, or other papers, and/or shall perform any act requested by Secured Party that may be necessary or advisable to create, perfect, preserve, validate or otherwise protect any security interest granted pursuant hereto or to enable Secured Party to exercise and enforce its rights hereunder or with respect to any such security interest; during the period any Indebtedness is outstanding, Debtor will not, without obtaining Secured Party's prior written approval, create, incur, assume, or permit to exist any security agreement subject to the Florida Uniform Commercial Code or any similar law of any jurisdiction, or any other lien or encumbrance on the Collateral except as provided herein or in any other of the Loan Documents; and Debtor will not sign or file or authorize the signing or filing of any financing statement(s) with respect to the Collateral or any part thereof, except as herein provided or as provided under any of the Loan Documents. Debtor further agrees to provide Secured Party with such information as Secured Party may from time to time request with respect to the location of any of its' places of business. In addition, Debtor shall notify Secured Party promptly in writing of any change(s) in the location of any office where records concerning any of the accounts that constitute part of the Collateral are located, or in the location of Debtor's principal place of business, and/or of any change(s) in the locations of any of the Collateral. D. Any and all of Secured Party's rights with respect to the security interest hereunder shall continue unimpaired, and Debtor shall be and remain obligated in accordance with the terms hereof, notwithstanding the release or substitution of any Collateral at any time(s), or of any rights or interest herein, or any delay, extension of time, renewal, compromise or other indulgence granted by Secured Party with respect to the Indebtedness, or any promissory note, draft, bill of exchange or other instrument given in connection therewith, Debtor hereby waiving all notice of any such delay, extension, release, substitution, renewal, compromise or other indulgence, and hereby consenting to be bound thereby as fully and effectively as if Debtor had expressly agreed thereto in advance. E. No delay on Secured Party's part in exercising any power of sale, option or other right or remedy hereunder, and no notice or demand which may be given to or made upon Debtor shall constitute a waiver thereof, or limit or impair Secured Party's right to take any action or to exercise any other power of sale, option or any other right or remedy hereunder, without notice or demand, or prejudice Secured Party's rights or remedies as against Debtor in any respect. F. Upon or after an Event of Default that is continuing (no right to reinstate the Loan or to cure any Event of Default is implied) and not before, Secured Party is authorized at its option, and without any obligation to do so, to, among its other remedies under this Security Instrument or at law or in equity, (x) transfer or register in the name of its nominee(s) all or any part of any securities that constitute a part of the Collateral, and to do so before or after the maturity of any of the Indebtedness, and with or without notice to Debtor, (y) proceed against and realize upon all proceeds of Trademarks and (z) exercise all rights with respect to Trademarks set forth in the paragraph defining "Trademarks" in Article 1 herein. G. Secured Party may assign or otherwise transfer its rights hereunder or any instrument(s) evidencing all or any of the Indebtedness and any agreement relating thereto (provided, however, that Secured Party, upon the written request of Debtor made not more frequently than once during any calendar year, shall disclose to Debtor the identity of all participants in the Loan and all assignees of the Loan), and may deliver all or any of the Collateral to the transferee(s), who shall thereupon become vested with all the powers and rights in respect thereto given to Secured Party herein or in the instrument(s) transferred, and Secured Party shall thereafter be forever relieved and fully discharged from any liability or responsibility with respect thereto arising thereafter, all without prejudice to the retention by Secured Party of all rights and powers hereby given with respect to any and all instruments, rights or property not so assigned or transferred. H. Reserved. I. Reserved. J. Debtor represents, covenants and warrants to Secured Party as follows: all the books, records, and documents of Debtor relating to the Collateral are and will be accurate in all material respects, and are in all respects what they purport to be; except as otherwise permitted herein, Debtor has, or, as to Collateral hereafter acquired, will have upon such acquisition, good and marketable title to the Collateral excepting only such encumbrances as are otherwise permitted under the Loan Documents, and Debtor has not previously transferred or assigned, and will not while any of the previously transferred or assigned, and will not while any of the Indebtedness secured hereby is unsatisfied, transfer or assign the Collateral, except in the ordinary course of its business or as otherwise expressly permitted under the Loan Documents; and except as provided herein or in any of the other Loan Documents, the Collateral is now, or, as to Collateral hereafter acquired, will be upon such acquisition, free and clear of any adverse claim or encumbrance, except as disclosed to Secured Party in writing prior to the date hereof or, as to Collateral hereafter acquired, within thirty (30) days after the acquisition thereof. K. Debtor shall keep the Collateral free from any and all liens, encumbrances and security interests except for the Permitted Exceptions and shall pay and discharge before the same become delinquent all taxes, levies and other charges upon Debtor and upon the Collateral and shall defend the Collateral against all claims of any persons other than Secured Party; provided, however, that Debtor may, at its expense, contest the amount or validity or application of any such taxes, levies or other charges by appropriate legal proceedings promptly initiated and conducted in good faith and with due diligence, provided further that such contest does not create a Risk of Forfeiture and Debtor has provided Secured Party Security with respect thereto. L. Except as otherwise expressly permitted hereunder or in the other Loan Documents, none of the Collateral is leased or will be leased unless Secured Party has or shall have approved, in writing, any such leasing and the lease agreements pertaining thereto and, in the event of such a written approval by Secured Party, the relevant lease agreements are conditionally assigned to Secured Party to secure the Obligations. M. Debtor covenants that the Collateral shall include all Fixtures and Personal Property (other than Excluded Equipment and Vehicles) necessary for the full operation of the Property as a first class enclosed regional mall shopping center. N. Notwithstanding any provisions hereof to the contrary, Secured Party shall not have any interest in or any lien upon, nor shall the provisions of Paragraph 7.1 or 7.2 herein apply to the Excluded Equipment and Vehicles or Tenant Fixtures and Improvements. 7.3 Remedies. This Instrument constitutes a security agreement with respect to the Collateral in which Secured Party is granted a security interest. In addition to the rights and remedies provided under this Instrument, Secured Party shall have all of the rights and remedies of a secured party under the Florida Uniform Commercial Code as well as all other rights and remedies available at law or in equity. Debtor hereby agrees to execute and deliver on demand and irrevocably constitutes and appoints Secured Party the attorney-in-fact of Debtor to, at Debtor's expense, execute, deliver and, if appropriate, to file with the appropriate filing officer or office such security agreements, financing statements, continuation statements or other instruments as Secured Party may request or require in order to impose, perfect or continue the perfection of the lien or security interest created hereby. Upon the occurrence of any Event of Default, Secured Party shall have the right to cause any of the Collateral which is personal property to be sold at any one or more public or private sales as permitted by applicable law and to apply the proceeds thereof to the Indebtedness or any other monetary obligation of Debtor to Secured Party, and the right to apply to the Indebtedness or any other monetary obligation of Debtor to Secured Party, any Collateral which is cash, negotiable documents or chattel paper. Any such disposition may be conducted by an employee or agent of Secured Party. Any Person, including both Debtor and Secured Party, shall be eligible to purchase any part or all of such Personalty at any such disposition. 7.4 Expenses. After the occurrence of an Event of Default that is continuing (no right to reinstate the Loan or to cure an Event of Default is implied) the following shall apply: Expenses of retaking, holding, preparing for sale, selling and the like shall be borne by the Debtor and shall include Secured Party's reasonable attorneys' fees and legal expenses. Debtor, upon demand of Secured Party, shall assemble such Collateral and make it available to Secured Party at the Property, which is deemed to be reasonably convenient to Secured Party and Debtor. Secured Party shall give Debtor at least ten (10) days' prior written notice of the time and place of any public sale or other disposition of such Collateral or of the time of or after which any private sale or any other intended disposition is to be made, and if such notice is sent to Debtor in the manner provided for the mailing of notices herein, it is hereby deemed such notice shall be and is reasonable notice to Debtor. 7.5 Fixture Filing. This Instrument constitutes a financing statement filed as a fixture filing in the official Records of the Clerk of the Circuit Court of the county in which the Property is located with respect to any and all Fixtures included within the term "Property" as used herein and with respect to any goods, Personalty or other personal property that may now be or hereafter become such Fixtures. 7.6 Fixtures. To protect Secured Party against the effect of Florida Commercial Code Section 679.313, as amended from time to time, if any Fixture owned by Debtor on the Property, or any part thereof, is replaced or added to, or any new Fixture owned by Debtor is installed or substituted by Debtor, and in each case such Fixture has a cost or fair market value in excess of One Hundred Thousand Dollars ($100,000), and such Fixture is subject to a security interest held by a seller or any other party, then: A. Debtor or any owner of all or any part of the Property shall, before the replacement, addition, installation or substitution of any such Fixture, obtain the prior written approval of Secured Party, and give Secured Party written notice that a security agreement with respect to such Fixture has been or will be consummated, which notice shall contain the following information: (1) a description of the Fixtures to be replaced, added to, installed or substituted; (2) a recital of the location at which the Fixtures will be replaced, added to, installed or substituted; (3) a statement of the name and address of the holder and amount of the security interest; and (4) the date of the purchase of such Fixtures. The failure of Debtor or such owner to give such notice and obtain the aforesaid approval shall be a material breach of Debtor's covenants under this Instrument, and shall, at the option of Secured Party, constitute a default hereunder, entitling Secured Party to all rights and remedies provided for herein on default of any of the terms, covenants, agreements and provisions of this Instrument and/or the Note. Neither this Paragraph 7.6.A nor any consent by Secured Party pursuant to this Paragraph 7.6.A shall constitute an agreement to subordinate any right of Secured Party in Fixtures or other property covered by this Instrument; B. Secured Party may, at its option, at any time, pay the balance due under said security agreement and the amount so paid shall be: (1) secured by this Instrument and shall be a lien on the Property enjoying the same priorities vis-a-vis the estates and interests encumbered hereby as this Instrument; (2) added to the amount of the Note or other obligation secured hereby; and (3) payable on demand with interest at the rate specified in the Note from the time of such payment as aforesaid. If Debtor shall be in default thereof for ten (10) days after written demand, the entire principal sum secured hereby with all unpaid interest accrued thereon shall, at the option of Secured Party, become due and payable immediately, anything contained in this Instrument or the Note to the contrary notwithstanding; or Secured Party shall have the privilege of acquiring by assignment from the holder of said security interest any and all contract rights, accounts receivable, chattel paper, negotiable or non-negotiable instruments, or other evidence of Debtor's Indebtedness for such Fixtures, and, upon acquiring such interest aforesaid by assignment, shall have the right to enforce the security interest as assignee thereof, in accordance with the terms and provisions of the Florida Uniform Commercial Code, as amended or supplemented, and in accordance with the law; C. Whether or not Secured Party has paid or taken an assignment of such security interest, if at any time Debtor shall be in default under the security agreement covering the Fixtures, such default shall be a material breach of Debtor's covenants under this Instrument, and shall at the option of Secured Party constitute a default under this Instrument; and D. Notwithstanding the foregoing, the provisions of Paragraphs 7.6.B and 7.6.C herein shall not apply if the goods which may become Fixtures are of at least equivalent value and quality as any property being replaced and if the rights of the party holding such security interest have been expressly subordinated, at no cost to Secured Party, to the lien of this Instrument in a manner satisfactory to Secured Party, including, at the option of Secured Party, providing to Secured Party a satisfactory opinion of counsel to the effect that this Instrument constitutes a valid and subsisting first lien on such Fixtures which is not subordinate to the lien of such security interest under any applicable law, including the provisions of Section 679.313 of the Florida Uniform Commercial Code. 7.7 Waivers. Debtor waives any right to require Secured Party to proceed against any Person, proceed against or exhaust any Collateral, or pursue any other remedy in its power; and any defense arising by reason of any disability or other defense of Debtor or any other Person, or by reason of the cessation from any cause whatsoever of the liability of Debtor or any other Person. Until the Indebtedness shall have been paid in full, Debtor shall not have any right to subrogation, and Debtor waives any right to require Secured Party to enforce any remedy which Secured Party now has or may hereafter have against Debtor or against any other Person and waives any benefit of and any right to participate in any Collateral or security whatsoever now or hereafter held by Secured Party. ARTICLE 8 Assignment of Rents 8.1 Assignment of Rents. Debtor absolutely and unconditionally assigns and transfers the Rents to Secured Party, whether now due, past due or to become due, and gives to and confers upon Secured Party the right, power and authority to collect such Rents, and apply the same to the Expenses and the Indebtedness. Debtor irrevocably appoints Secured Party its agent to, at any time, demand, receive and enforce payment, to give receipts, releases and satisfactions, and to sue, either in the name of Debtor or in the name of Secured Party, for all such Rents, but Secured Party shall not exercise such rights, power and authority unless there is an Event of Default which is continuing (no right to reinstate or cure an Event of Default is implied). Neither the foregoing assignment of Rents to Secured Party or the exercise by Secured Party of any of its rights or remedies under this Instrument shall be deemed to make Secured Party a "mortgagee-in-possession" or otherwise responsible or liable in any manner with respect to the Property or the use, occupancy, enjoyment or operation of all or any part thereof, unless and until Secured Party, in person or by its own agent, assumes actual possession thereof, nor shall appointment of a Receiver for the Property by any court at the request of Secured Party or by agreement with Debtor or the entering into possession of the Property or any part thereof by such Receiver be deemed to make Secured Party a "mortgagee-in-possession" or otherwise responsible or liable in any manner with respect to the Property or the use, occupancy, enjoyment or operation of all or any part thereof. 8.2 Collection of Rents. Notwithstanding anything to the contrary contained herein or in the Note, so long as no Event of Default shall have occurred, Debtor shall have a license, revocable upon the occurrence of an Event of Default (without implying the right to reinstate or to cure an Event of Default, upon the cure of any Event of Default agreed to in writing by Secured Party or required by law, this license shall be reinstated), to collect all Rents, and to first apply the same to the Expenses and the Indebtedness as and when due and thereafter to retain, use and enjoy the same and to otherwise exercise all rights with respect thereto, subject to the terms hereof. Upon the occurrence of an Event of Default, Secured Party shall have the right, on written notice to Debtor, to terminate and revoke the license hereinafter granted to Debtor and shall have the complete right and authority then or thereafter to exercise and enforce any and all of its rights and remedies provided herein or by law or at equity. ARTICLE 9 Miscellaneous 9.1 Use of the term "Debtor". The term "Debtor", when used herein, refers to West Dade County Associates, its successors and assigns and to any Subsequent Owner. The liability of any Subsequent Owner shall be joint and several for all the representations, warranties and covenants with respect to the Property made by the Debtor in this Instrument, subject, in each case, to the limitations and liability contained in Paragraph 9.33 herein. 9.2 Change of Law. In the event of the passage, after the date of this Instrument, of any law deducting from the value of the Property, for the purposes of real property taxation, any lien thereon, or changing in any way the laws now in force for the taxation of mortgages, deeds of trust, or debts secured by mortgage or deed of trust (other than laws imposing taxes on income), or the manner of the collection of any such taxes so as to materially and adversely affect the rights of Secured Party as holder of the Note and/or Secured Party under this Instrument, the Indebtedness (excluding any applicable prepayment charges) shall become due and payable at the option of Secured Party without payment of any prepayment penalty exercised by thirty (30) days' notice to Debtor unless Debtor, within such thirty (30) day period shall, if permitted by law, assume the payment of any tax or other charge so imposed upon Secured Party for the period remaining until full payment by Debtor of the Indebtedness. 9.3 No Waiver. No waiver by Secured Party of any default or Breach by Debtor hereunder shall be implied from any omission by Secured Party to take action on account of such default if such default persists or is repeated, and no express wavier shall affect any default other than the default expressly referenced in the waiver and such waiver shall be operative only for the time and to the extent therein stated. Waivers of any covenant, term or condition contained herein shall not be construed as a waiver of any subsequent breach of the same covenant, term or condition. The consent or approval by Secured Party to or of any act by Debtor requiring further consent or approval shall not be deemed to waive or render unnecessary the consent or approval to or of any subsequent similar act. 9.4 Abandonment. Subject to such chattel mortgages, security agreements or other liens on title as may exist thereon with the consent of Secured Party, or any provided for herein, any and all Personalty that upon foreclosure of the Property is owned by Debtor and is used in connection with the operation of the Property shall be deemed at the option of Secured Party to have become on such date a part of the Property and abandoned to Secured Party in its then condition. 9.5 Notices. All notices, demands, requests, consents, statements, satisfactions, waivers, designations, refusals, confirmation or denials that may be required or otherwise provided for or contemplated under the terms of this Instrument shall be in writing, and shall be deemed to have been properly given upon delivery, if delivered in person, one business day after having been deposited for overnight delivery with Federal Express or another comparable overnight courier service, or three business days after having been deposited in any post office or mail depository regularly maintained by the U.S. Postal Service and sent by registered or certified mail, postage prepaid, addressed as follows: To Debtor: West Dade County Associates 1455 Northwest 107th Avenue, Room 596 Miami, Florida 33172 With copy to: Urban Shopping Centers, L.P. 900 North Michigan Avenue Chicago, Illinois 60611-1575 Attn: Chief Financial Officer JMB Realty Corporation 900 North Michigan Avenue Chicago, Illinois 60611-1575 Attn: Mr. Robert Chapman The Edward J. DeBartolo Corporation P.0. Box 3287 7620 Market Street Youngstown, Ohio 44513-6085 Attn: Mr. Dean Kissos The Edward J. DeBartolo Corporation P.0. Box 3287 7620 Market Street Youngstown, Ohio 44513-6085 Attn: Leon S. Zionts, Esq. Pircher, Nichols & Meeks 1999 Avenue of the Stars, Suite 2700 Los Angeles, California 90067 Attention: Real Estate Notices To Secured Party: The Prudential Insurance Company of America One Ravinia Drive, Suite 1400 Atlanta, Georgia 30346 Attn: Mortgage Capital Reference: Loan No. 6 100 405 With copy to: The Prudential Insurance Company of America One Ravinia Drive, Suite 1400 Atlanta, Georgia 30346 Attn: Law Department Reference: Loan No. 6 100 405 or addressed to each respective party at such other address as such party may from time to time designate by written notice to the other parties (which notice shall be effective only upon receipt). 9.6 Severability. If any term, provision, covenant or condition hereof or any application thereof should be held by a court of competent jurisdiction to be invalid, void or unenforceable, in whole or in part, all terms, provisions, covenants and conditions hereof and all applications thereof not held invalid, void or unenforceable shall continue in full force and effect and shall in no way be affected, impaired or invalidated thereby. 9.7 Joinder of Foreclosure. Should Secured Party hold any other or additional security for the payment of the Indebtedness or performance of the Obligations, its sale or foreclosure, upon any default in such payment or performance, in the sole discretion of Secured Party, may be prior to, subsequent to, or joined or otherwise contemporaneous with any sale or foreclosure hereunder. In addition to the rights herein specifically conferred, Secured Party, at any time and from time to time, may exercise any right or remedy now or hereafter given by law to mortgagees under mortgages or beneficiaries under deeds of trust generally, or to the holders of any obligations of the kind hereby secured. 9.8 Governing Law. The parties expressly agree that this Instrument (including, without limitation, all questions regarding permissible rates of interest) shall be governed by and construed in accordance with the laws of the state in which the Land is located. 9.9 Subordination. At the option of Secured Party, this Instrument shall become subject and subordinate in whole or in part (but not with respect to priority of entitlement to any insurance proceeds, damages, awards, or compensation resulting from damage to the Property or condemnation or exercise of power of eminent domain), to any and all contracts of sale and/or any and all Leases upon the execution by Secured Party and recording thereof in the Official Records of the County in which the Land is located of a unilateral declaration to that effect. Secured Party may require the issuance of such title insurance endorsements to the Title Policy in connection with any such subordination as Secured Party, in its reasonable judgment, shall determine are appropriate, and Debtor shall be obligated to pay any cost or expense incurred in connection with the issuance thereof. 9.10 Future Advances. Upon the request of Debtor or its permitted successors in ownership of the Property, Secured Party may hereafter, at its option, at any time before full payment of the Indebtedness, make further advances to Debtor or said successors, and any such future advances which are made within twenty (20) years from the date of this Instrument, with interest and late charges, if applicable, shall be secured by this Instrument; provided, however, that the total amount of indebtedness that may be so secured may decrease or increase from time to time, but the total unpaid balance of such indebtedness so secured at any one time by this Instrument shall not exceed twice the face amount of the Note, plus interest thereon, and any disbursements made by Secured Party for the payment of taxes, levies on insurance on the Property with interest on such disbursements at the Secondary Loan Rate; and provided further that if Secured Party, at its option, shall make a further advance or advances as aforesaid, Debtor or said successors in ownership agree to execute and deliver to Secured Party a note to evidence the same, payable on or before the maturity of the Indebtedness secured hereby and bearing such other terms as Secured Party shall require, and satisfactory evidence that after such advance this Instrument will secure such advance and continue to constitute a valid first mortgage lien on the Property subject only to the Permitted Exceptions. 9.11 Right to Accelerate, Waiver of Statute of Limitations and the Right to Redeem. Debtor acknowledges on behalf of itself, its successors and assigns that Secured Party has the right to accelerate the maturity of the Indebtedness as provided by the terms and provisions of the Note. Debtor waives its rights of redemption in the event of foreclosure of this Instrument to the fullest extent permitted by applicable law. The pleading of any statute of limitations as a defense to any and all obligations secured by this Instrument is hereby waived, to the fullest extent allowed by law. 9.12 Entire Agreement. The Loan Documents set forth the entire understanding between Debtor and Secured Party relative to the Loan and the same shall not be amended except by a written instrument duly executed by each of Debtor and Secured Party. Any and all previous representations, warranties, agreements and understandings between or among the parties regarding the subject matter of the Loan or the Loan Documents, whether written or oral, are superseded by this Instrument and the other Loan Documents. 9.13 References to Foreclosure. References in this Instrument to "foreclosure" and related phrases shall be deemed references to the appropriate procedure in connection with Secured Party's private power of sale as well as any judicial foreclosure proceeding or a conveyance in lieu of foreclosure. Debtor hereby waives its rights, if any, to require that the Property be sold as separate tracts or units in the event of foreclosure. 9.14 Rights of Secured Party. At any time or from time to time, without liability therefor and without notice, and without releasing or otherwise affecting the liability of any person for payment of any Indebtedness, Secured Party at its sole discretion and only in writing may extend the time for, or release any Person now or hereafter liable for, payment of any or all such Indebtedness, or accept or release additional security therefor, or subordinate the lien or charge hereof, or Secured Party may release any part of the Property, consent to the making of any map or plat thereof, join in granting any easement thereon, or join in any such agreement of extension or subordination. 9.15 Copies. Each Loan Party, as to itself only, will promptly give to Secured Party copies of all notices of violation relating to the Property which such Loan Party receives from any governmental agency or authority, all notices of default that any Loan Party shall give or receive under any agreement that any Loan Party, covenants to perform hereunder if such default would have a material and adverse effect on Debtor, the Property, the interest of Debtor in the Property, or the lien or security interest created by this Instrument, and all notices of default relating to the Property that any Loan Party receives under any other agreement relating to the borrowing of money by Debtor. 9.16 No Merger. So long as any of the Indebtedness shall remain unpaid or Debtor shall have any further obligation under the Loan Documents, unless Secured Party shall otherwise consent in writing, the fee estate of Debtor in the Property or any part thereof shall not merge, by operation of law or otherwise, with any leasehold or other estate in the Property or any part thereof, but shall always be kept separate and distinct therefrom, notwithstanding the union of said fee estate and such leasehold or other estate in Debtor or any other Person. 9.17 Right of Entry. In addition to the rights granted to Secured Party under Paragraph 3.10 herein, Secured Party, upon prior written notice to Debtor, may enter at any reasonable time upon any part of the Property (subject to any limitations on Debtor's rights of entry under any Leases but with all rights of Secured Party under Paragraph 3.10 herein subject to the provisions of said paragraph or under this Security Instrument or any of the Loan Documents) for the purpose of performing any of the acts Secured Party is authorized to perform under the terms of this Instrument. Debtor agrees to cooperate with Secured Party to facilitate such entry. 9.18 WAIVER OF TRIAL BY JURY. DEBTOR HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM FILED BY DEBTOR OR SECURED PARTY, WHETHER IN CONTRACT, TORT OR OTHERWISE, RELATING DIRECTLY OR INDIRECTLY TO THE NOTE, THIS INSTRUMENT, THE LOAN, THE LOAN DOCUMENTS OR ANY ACTS OR OMISSIONS OF SECURED PARTY IN CONNECTION THEREWITH. 9.19 Personalty Security Instruments. Debtor covenants and agrees that if Secured Party at any time holds additional security for any obligations secured hereby, it may enforce the terms thereof or otherwise realize upon the same, at its option, either before or concurrently herewith or after a sale is made hereunder, and may apply the proceeds upon the Indebtedness secured hereby without affecting the status or of waiving any right to exhaust all or any other security, including the security hereunder, and without waiving any breach or default or any right or power whether exercised hereunder, and without waiving any breach or default or any right or power whether exercised hereunder or contained herein or in any such other security. 9.20 Suits to Protect Property. In the event not caused by the gross negligence or willful misconduct of Secured Party, Debtor covenants and agrees to appear in and defend any action or proceeding purporting to affect the security of the Instrument, or of any additional or other security for the Obligations, the interest of Secured Party or the rights, powers and duties of Secured Party hereunder; and in the event not caused by the gross negligence or willful misconduct of Secured Party, to pay all reasonable out-of-pocket costs and expenses, including cost of evidence of title and reasonable attorneys' fees, in any action or proceeding in which Secured Party may appear or be made a party, including foreclosure or other proceeding commenced by those claiming a right to any part of the Property in any action to partition or condemn all or part of the Property, whether or not pursued to final judgment, and in any exercise of the power of sale contained herein, whether or not the sale is actually consummated. Debtor agrees that in any such action or proceeding in which Secured Party is made a party, Secured Party may at its option defend such action. 9.21 Junior Liens. Debtor represents and warrants that as of the date hereof there are no encumbrances to secure debt junior to this Instrument and covenants that there are to be none as of the date when this Instrument becomes of record. 9.22 Charges for Servicing Requests. Debtor shall pay Secured Party a reasonable servicing fee and pay all reasonable out-of-pocket expenses and reimburse Secured Party for any reasonable out-of-pocket expenditures incurred or expended in connection with any servicing request, including but not limited to requests for escrow releases, lease reviews, changes in the standard lease form, Tenant subordination and nondisturbance agreements (there shall be one fee for a lease review and Tenant subordination and nondisturbance agreement with respect to such lease being reviewed if both are submitted at the same time) or other similar matters. Notwithstanding the foregoing, as to servicing requests made prior to December 31, 1994, it is agreed that a reasonable servicing fee for any required lease approval shall be $1,500.00, for review of an easement, it shall be $500.00, for the review of a Tenant subordination and nondisturbance agreement not submitted with a lease review request as to the lease involved, it shall be $500.00 and for review of a material change to the Standard Lease, it shall be $500.00. 9.23 Usury. All agreements in this Instrument and in the other Loan Documents are expressly limited so that in no contingency or event whatsoever, whether by reason of advancement or acceleration of maturity of the Obligations, or otherwise, shall the amount paid or agreed to be paid hereunder for the use, forbearance or detention of money exceed the highest lawful rate permitted under applicable usury laws. If, from any circumstance whatsoever, fulfillment of any provision of the Loan Documents, at the time performance of such provision shall be due, shall involve transcending the limit of validity prescribed by law which a court of competent jurisdiction may deem applicable hereto, then, ipso facto, the obligation to be fulfilled shall be reduced to the limit of such validity and if, from any circumstance whatsoever, Secured Party shall ever receive as interest an amount which would exceed the highest lawful rate, the receipt of such excess shall be deemed a mistake and shall be cancelled automatically or, if theretofore paid, such excess shall be credited against the principal amount of the Obligations to which the same may lawfully be credited without payment of any prepayment penalty, and any portion of such excess not capable of being so credited shall be rebated to Debtor. 9.24 Publicity. Debtor hereby agrees that Secured Party may publicize the financing of the Property in trade and similar publications following reasonable notification of Debtor and approval thereof by Debtor, such approval not to be unreasonably withheld or delayed, if such publicity relates to all of Secured Party's related transactions with Debtor, DeBartolo, and their affiliates and not to this transaction alone. 9.25 [Intentionally Omitted]. 9.26 ERISA. A. Secured Party represents and warrants to Debtor that, at Closing, and subject to the provisions of Paragraph 9.26.H herein, throughout the term of this Security Instrument the source of funds from which Secured Party extends the Loan is its General Account, which is subject to the claims of its general creditors under state law, and not from any account holding "plan assets" within the meaning of 29 C.F.R. 2510.3-101 or assets of any "governmental plan" within the meaning of section 3(32) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). B. Debtor represents and warrants to Secured Party that, as of the date of this Security Instrument and, subject to the provisions of Paragraph 9.26.G herein, throughout the term of this Security Instrument, (a) Debtor is not an "employee benefit plan" as defined in Section 3(3) of ERISA, which is subject to Title I of ERISA, and (b) the assets of the Debtor do not constitute "plan assets" of one or more such plans within the meaning of 29 C.F.R. 2510.3-101. C. Debtor represents and warrants to Secured Party that, as of the date of this Security Instrument and, subject to the provisions of Paragraph 9.26.G herein, throughout the term of this Security Instrument, (a) Debtor is not a "governmental plan" within the meaning of Section 3(32) of ERISA and (b) transactions by or with Debtor are not subject to state statutes regulating investments of and fiduciary obligations with respect to governmental plans. D. Debtor covenants and agrees to deliver to Secured Party such certifications or other evidence at Closing, subject to the provisions of Paragraph 9.26.G herein, and from time to time throughout the term of this Security Instrument, as reasonably requested by Secured Party, that the assets of Debtor do not constitute "plan assets" of any employee benefit plan or governmental plan within the meaning of 29 C.F.R., 2510.3-101, because one or more of the following is true: (i) Interests in Debtor are publicly offered securities, within the meaning of 29 C.F.R. 2510.3- 101(b)(2); (ii) Less than 25 percent of all equity interests in Debtor are held by "benefit plan investors" within the meaning of 29 C.F.R. 2510.3-101(f)(2); or (iii) Debtor qualifies as an "operating company" or a "real estate operating company" within the meaning of 29 C.F.R., 2510.3-101(c) or (e). E. Any of the following shall, subject to the notice and opportunity to cure provisions of Paragraph 6.1 herein, constitute a default under this Security Instrument, entitling Secured Party to exercise any and all remedies to which it may be entitled under the Loan Documents: (a) the failure of any representation or warranty made by Debtor under this Paragraph 9.26 to be true and correct in all respects, (b) the failure of Debtor to provide Secured Party with the written certifications and evidence referred to above, or (c) the consummation by Debtor of a transfer in violation of Paragraph 9.26.G herein. F. Debtor shall indemnify Secured Party and defend and hold Secured Party harmless from and against all loss, damage and reasonable out-of-pocket costs and expenses (including, without limitation, reasonable attorney's fees and costs incurred in the investigation, defense and settlement of claims and losses incurred in correcting any prohibited transaction or in the sale of a prohibited loan, and in obtaining any individual prohibited transaction exemption under ERISA that may be reasonably required by Secured Party) that Secured Party may incur, directly or indirectly, as a result of a default under the immediately preceding Paragraph 9.26.E. This indemnity shall survive any termination, satisfaction or foreclosure of this Security Instrument and shall not be subject to the limitation on personal liability described in Paragraph 9.33 herein. Provided however, upon any permitted transfer of title to the Real Estate Security or a fifty percent (50%) partnership interest in Debtor (provided the transferor has obtained a Prospective Release under the provisions of Paragraph 4.2.K herein in the case of such a fifty percent (50%) partnership interest transfer) which are in full compliance with Paragraphs 4.2 and 9.26.G(2) herein, such transferor shall not thereafter have any recourse liability under this Paragraph 9.26.F herein. G. (1) Anything in Paragraph 4.2 herein or elsewhere in the Application or in this Security Instrument to the contrary notwithstanding, no sale, assignment, encumbrance or transfer of any direct or indirect interest in the Debtor shall be permitted which would negate Debtor's representations in this Paragraph or in the case of encumbrance only, foreclosure of the encumbrance would negate Debtor's representations in this paragraph. (2) Anything in the Security Instrument to the contrary notwithstanding, not less than fifteen (15) days before consummation of transfer of title to the Real Estate Security or of an interest in Debtor, or of any direct or indirect right, title or interest in either of them, or of the placing of any lien or encumbrance on the Real Estate Security, Debtor shall obtain from the proposed transferee or lienholder a representation to Secured Party in form and substance satisfactory to Secured Party that Paragraph 9.26.D herein will be true after the transfer or would be true following a foreclosure of such lien, and further provided that any proposed lienholder agrees that any direct or indirect transfer of its lien or any interest therein will be governed by this Paragraph. H. Anything in Paragraph 4.2 herein or elsewhere in the Application or in this Security Instrument to the contrary notwithstanding: (1) Not less than thirty-five (35) days before consummation of any sale, assignment or transfer of any direct or indirect interest in the Loan (a "Transfer") to (i) an "employee benefit plan" within the meaning of Section 3(3) of ERISA which is subject to Title I of ERISA; (ii) a governmental plan within the meaning of Section 3(32) of ERISA; or (iii) an entity that holds plan assets of one or more such plans within the meaning of 29 C.F.R. 2510.3-101; Secured Party shall provide notice to Debtor of the proposed Transfer and of the proposed buyer, assignee or transferee and whether the buyer, assignee or transferee is an employee benefit plan, governmental plan or an entity that holds plan assets, and the name of any such employee benefit plan or governmental plan. (2) Secured Party shall not consummate the proposed Transfer if Debtor, after receiving timely notice of the proposed transfer, provides notice to Secured Party not more than ten (10) days after notice is received from Secured Party of the Transfer, that such Transfer might reasonably be viewed as causing the loan transaction (or any exercise of Debtor's rights under the Loan Documents) to be a violation of ERISA or any applicable statute regulating a governmental plan at the time of the Transfer. Debtor's notice shall state the facts and reasons upon which Debtor relied in deciding that the proposed Transfer would cause the Loan or the exercise of Debtor's rights under the Loan Documents to violate ERISA or any applicable state statute at the time of the Transfer. Notwithstanding the foregoing, Secured Party may consummate the proposed Transfer if Secured Party in its sole discretion believes that based upon the facts set forth in Debtor's notice, the proposed Transfer does not cause the Loan or the exercise of Debtor's rights under the Loan Documents to violate ERISA or any applicable state statute, at the time of the Transfer, provided, however, that Secured Party shall indemnify Debtor and defend and hold Debtor harmless from and against all loss, cost, damage and expense that Debtor shall incur, directly or indirectly, as a result of a Transfer under this paragraph (including but not limited to attorney's fees and costs incurred in the investigation, defense and settlement of claims and losses incurred in correcting any prohibited transaction, or in obtaining any individual prohibited transaction exemption that may reasonably be required); and further provided, however, that Secured Party shall have no liability to Debtor under the foregoing indemnity for (1) any loss resulting from a Transfer based upon any misrepresentation, incorrect statement of fact, or omission of fact by Debtor in said notice and (2) any action taken by the transferee, as Secured Party, in violation of the restrictions on transfer set forth in the Section. (3) Debtor shall have no right of setoff or defense to the payment or performance of any obligation under the Loan Documents as a result of any violation of this subparagraph by Secured Party. 9.27 Defense and Indemnity Rights. Whenever, under any Loan Document, Debtor is obligated to indemnify and/or defend Secured Party, or Debtor is obligated to defend or prosecute any action or proceeding, then Secured Party shall have the right of counsel of Secured Party's choice reasonably exercised, and all reasonable out-of-pocket costs and expenses incurred by Secured Party in connection with such participation (including reasonable attorneys' fees) shall be reimbursed by Debtor to Secured Party within fifteen (15) days of written demand to the extent substantiated by appropriate invoices and supporting information. In addition, Secured Party shall have the right to reasonably approve any counsel retained by Debtor in connection with the prosecution or defense of any such action or proceeding by Debtor. Debtor shall give notice to Secured Party of the initiation of all proceedings required to be defended by Debtor which are subject to the obligations of Debtor and to Secured Party under this Paragraph, promptly after the receipt by Debtor of notice of the existence of any such proceeding, but in no event later than thirty (30) days thereafter. All costs or expenses required hereunder to be reimbursed by Debtor to Secured Party hereunder shall, if not paid within fifteen (15) days of written demand as herein specified, bear interest at the Secondary Interest Rate. As used herein, "proceeding" shall mean litigation (whether by way of complaint, answer, cross-complaint or counterclaim), arbitration and administrative hearings or proceedings. Secured Party shall, with reasonable promptness following notice or discovery thereof, notify Debtor of any claim or event requiring action by Debtor under this Paragraph but Secured Party's failure to do so will not excuse or discharge the obligations of Debtor hereunder if Debtor had actual knowledge of any such claim or event before the expiration of the period in which Secured Party should have provided such notice to Debtor and, provided that no Event of Default exists and is continuing, Secured Party will not settle or compromise any such claim without the prior written approval of Debtor not to be unreasonably withheld. 9.28 Destruction of Note. Debtor shall, if the Note is mutilated or destroyed by any cause whatsoever, or otherwise lost or stolen and regardless of whether due to the act or neglect of Secured Party, execute and deliver to Secured Party in substitution therefor a duplicate promissory note containing the same terms and conditions as the Note, within ten (10) days after Secured Party notifies Debtor of any such mutilation, destruction, loss or theft of the Note. Any new promissory note executed and delivered hereunder shall be in full substitution for the Note, shall not constitute any new or additional indebtedness of Debtor to Secured Party, shall constitute solely a substitute evidence of the indebtedness evidenced by the original Note, and shall not affect in any manner the priority of this Instrument, or any other document or instrument executed in connection with or evidencing or securing the Indebtedness under the Note. Failure or delay by Secured Party in notifying Debtor hereunder shall not affect in any manner Debtor's liability for the Indebtedness under the Note or Debtor's obligation to execute a new promissory note hereunder; and Debtor's failure to execute a new promissory note on Secured Party's request hereunder shall likewise not affect Debtor's liability for the indebtedness under the Note. If Secured Party requests that Debtor execute a new promissory note when permitted by this Paragraph, Secured Party shall indemnify, protect and save Debtor harmless from and against any and all claims, demands, actions, suits, proceedings, damages, losses, costs and expenses of every nature whatsoever (including, without limitation, reasonable attorneys' fees) arising from or relating to the original Note or the execution of the substitute promissory note. 9.29 Successor and Assigns. The provisions hereof shall be binding upon, and inure to the benefit of, Debtor and the heirs, devisees, representatives, successors and assigns of Debtor, including successors in interest to Debtor in and to all or any part of the Collateral, and shall inure to the benefit of Secured Party, its successors and assigns. 9.30 Rules of Construction. When the identity of the parties or other circumstances make it appropriate, the masculine gender shall include the feminine and/or neuter, and the singular number shall include the plural. The headings of each Article and Paragraph are for information and convenience and do not limit or construe the contents of any provision hereof. The provisions of this Instrument and all other Loan Documents shall be construed as a whole according to their common meaning, not strictly for or against any party and consistent with the provisions herein contained, in order to achieve the objectives and purposes of such documents. Each party and its counsel has reviewed and revised the Loan Documents and agree that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of such document. Specific enumeration of rights, powers and remedies of Secured Party and of acts which they may do and of acts Debtor must do or not do shall not exclude or limit the general. The use in this Instrument and all other Loan Documents of the words "including", "such as", or words of similar import, when following any general term, statement or matter shall not be construed to limit such statement, term or matter to the specific items or matters, whether or not language of non-limitation such as "without limitation" or "but not limited too, or words of similar import, are used with reference thereto, but rather shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such statement, term or matter. 9.31 Assignment of Mortgage and Information to Third Persons. Secured Party shall have the right in its sole discretion at any time during the term of this Loan to sell, assign, syndicate or otherwise transfer and/or dispose of all or any portion of its interest in the Loan and Debtor hereby permits Secured Party to submit, on a confidential basis, to Secured Party's assignees, the financial data and all other information being furnished by Debtor to Secured Party under the terms of the Loan; provided, however, that Secured Party, upon the written request of Debtor made not more frequently than once during any calendar year, shall disclose to Debtor the identity of all participants in the Loan and all assignees of the Loan. 9.32 Commingling of Funds. Except as otherwise provided in this instrument, any and all sums collected or retained by Secured Party hereunder (including insurance and condemnation proceeds and any amounts paid by Debtor to Secured Party under Paragraph 3.4 above), shall not be deemed to be held in trust, and Secured Party may commingle any and all such funds or proceeds with its general assets and shall not be liable for the payment of any interest or other return thereon, except to the extent otherwise required by law or expressly provided for herein. 9.33 Limitation on Personal Liability. Secured Party agrees, subject to the specific exceptions set forth below and not as to any Loan Document which expressly states it is not subject, in whole or in part, to this Limitation on Personal Liability provision (including, but not by way of limitation, the Hazardous Substances Remediation and Indemnification Agreement and the Other Loan Party Agreement), to the extent the provisions of any such Loan Document expressly provides that all or any part of this paragraph is not applicable to any such document, that in enforcing any obligations under the Loan Documents its sole recourse shall be limited to the collateral for the loan and it will look solely and only to such collateral in enforcing any such obligations. Further, subject to the specific exceptions set forth below and excluding any Loan Document which expressly states that it is not subject to this Limitation on Personal Liability provision to the extent the provisions of any such Loan Document expressly provides that all or any part of this paragraph is not applicable to any such document, neither Debtor, its partners nor any Other Loan Party ("Exculpated Parties") shall have any personal liability under the Loan Documents, except that Debtor, its general partners (but not the partners of such parties unless they are also Other Loan Parties and/or any negative capital accounts of any partners not created for the purpose of evading liability hereunder), and the Other Loan Parties (but not the partners of such parties unless they are also Other Loan Parties and/or any negative capital accounts of any partners not created for the purpose of evading liability hereunder) shall be jointly and severally liable for the payment of taxes, assessments and utility charges with respect to the Real Estate Security or any part thereof which become due and payable prior to the earlier to occur of (x) Secured Party taking possession of the Real Estate Security, (y) the appointment of a receiver for the Real Estate Security or (z) the issuance of a certificate of title pursuant to a foreclosure sale of the Real Estate Security or upon Holder's acceptance of, in its sole discretion, without regard to the Standard of Conduct, a deed- in-lieu of foreclosure and such joint and several liability as provided for under the ERISA paragraphs of this Security Instrument including the indemnification provisions herein and for the Indemnity Obligations under and as defined in the Hazardous Substances Remediation and Indemnification Agreement obligations of the Other Loan Parties under the Other Loan Party Agreement. Without limitation on the foregoing and notwithstanding anything to the contrary herein, in no event shall any of the partners, officers, directors, employees, or shareholders of the Exculpated Parties have any personal liability under the Loan Documents (unless they are either an entity which is a general partner of Debtor or an entity which is an Other Loan Party) and any negative capital account of any partners not created for the purpose of evading liability hereunder, shall not be available as collateral to the Secured Party. Moreover, after written notice from Secured Party to the Exculpated Parties, the agreement not to pursue recourse liability SHALL BECOME NULL AND VOID and of no further force and effect as to Debtor, its general partners and the Other Loan Parties (but not the officers, directors, employees, or shareholders of Debtor's general partners and of the Other Loan Parties, any partners of Debtor's general partners unless they are also Other Loan Parties and any partners of the Other Loan Parties unless they are also Other Loan Parties nor any negative capital account of any partner not created for the purpose of evading any liability hereunder) in the event: (a) of actionable fraud or intentional material misrepresentation in connection with the Loan not cured within thirty (30) days after written notice of the same from Secured Party to Debtor (but not in addition to any cure period applicable to any written notice of default by Secured Party to Debtor given under the Loan Documents based on such occurrences). (b) of the misapplication of (i) proceeds paid under any insurance policies by reason of damage, loss or destruction affecting any portion of the Mortgaged Premises (to the full extent of such proceeds that were misapplied) not cured within thirty (30) days after written notice of the same from Secured Party to Debtor (but not in addition to any cure period applicable to any written notice of default by Secured Party to Debtor given under the Loan Documents based on such occurrences); (ii) any proceeds or awards resulting from the condemnation of all or any part of the Mortgaged Preemies (to the full extent of such proceeds or awards that were misapplied) not cured within thirty (30) days after written notice of the same from Secured Party to Debtor (but not in addition to any cure period applicable to any written notice of default by Secured Party to Debtor given under the Loan Documents based on such occurrences) ; or (iii) rents received after receipt by Debtor of any notice to which Debtor may be entitled, if any, of default or of foreclosure or of exercise of other remedies by Secured Party upon a default by Debtor; or (c) of any tenant security deposits not turned over to Secured Party upon foreclosure or sale pursuant to power of sale if, at such time, there is a legal duty to return said tenant security deposit to the depositing tenant, now or in the future, under the provisions of any such tenant's lease or under Florida law; or (d) of any intentional waste of the Mortgaged Premises not cured within thirty (30) days after written notice of the same from Secured Party to Debtor (but not in addition to any cure period applicable to any written notice of default by Secured Party to Debtor given under the Loan Documents based on such occurrences). The recourse liability resulting from (b), (c) and (d) above shall apply only to the extent of the lesser of (x) the amount involved in (b), (c), and (d) above, as applicable, and (y) the amount (the "Deficiency Amount"), if any, by which the sums owed under the loan documents exceed the fair market value of the collateral for the loan at the time of any foreclosure sale or deed in lieu of foreclosure as to said collateral. The foregoing provisions shall not limit or diminish Secured Party's other rights and remedies with respect to the collateral for the loan under any provisions of the Loan Documents or at law and in equity, including, without limitation, the right to foreclose nor shall such provisions limit or diminish Secured Party's rights and remedies under any provisions of the Loan Documents in seeking personal liability therefor as to any of the above specific exceptions to the Limitation on Personal Liability provisions or as to any Loan Document which expressly states it is not subject to the above Limitation on Personal Liability provisions. Notwithstanding any term or provision contained herein or in the Loan Documents, the liability hereunder of Urban Shopping Centers, L.P., a Maryland limited partnership, JMB Income Properties, Ltd.-XIII, an Illinois limited partnership, and IDS/JMB Balanced Income Growth, Ltd., an Illinois limited partnership (collectively the "JMB Loan Parties") and each of them, jointly and severally among each other, shall not exceed fifty percent (50%) ("JMB Cap") of the total recourse dollar amount Secured Party would, but for the JMB Cap and DeBartolo Cap, be entitled to recover from all of the Other Loan Parties including the JMB Loan Parties plus interest on said amount at the Secondary Interest Rate, and reasonable out-of-pocket costs of enforcement and reasonable attorneys fees in recovering the same less any amounts realized by Secured Party from Debtor, all of the Other Loan Parties, and the Collateral (but not from the DeBartolo Loan Parties) in excess of the total nonrecourse dollar amount owed to Secured Party with no obligation to proceed against any of them. In no event however, should Secured Party collect more than one hundred percent (100%) of the sums due hereunder. The liability of DeBartolo, DRC and DRPLP (collectively the "DeBartolo Loan Parties") and each of them, jointly and severally among each other, shall not exceed fifty percent (50%) ("DeBartolo Cap") of the total recourse dollar amount Secured Party would, but for the DeBartolo Cap and JMB Cap, be entitled to recover from all of the Other Loan Parties including the DeBartolo Loan Parties plus interest on said amount at the Secondary Interest Rate and reasonable out-of-pocket costs of enforcement and reasonable attorneys fees in recovering the same less any amounts realized by Secured Party from Debtor, all of the Other Loan Parties and the Collateral (but not from the JMB Loan Parties) in excess of the total nonrecourse dollar amount owed to Secured Party with no obligation to proceed against any of them. In no event however, should Secured Party collect more than one hundred percent (100%) of the sums due hereunder. The JMB Cap and DeBartolo Cap shall not cause or create any obligation of Secured Party to collect all or any portion of the sums due hereunder or to enforce any obligation of Debtor, the JMB Loan Parties or the DeBartolo Loan Parties hereunder or of Debtor under the Loan Documents or to exercise any of Secured Party's rights or remedies as to the collateral for the Loan. The liability of the JMB Loan Parties, the DeBartolo Loan Parties and Debtor are primary and absolute obligations of each subject to the JMB Cap, in the case of the JMB Loan Parties, and the DeBartolo Cap, in the case of the DeBartolo Loan Parties. After a transfer pursuant to the provisions of Paragraph 4.2.E herein, the JMB Cap and DeBartolo Cap will no longer be applicable to the transferee pursuant to the provisions of Paragraph 4.2.E herein (transfers between JMB and DeBartolo Affiliates). Further, the Debtor and Other Loan Parties may qualify for a release from their recourse obligations under the Loan Documents under certain circumstances and subject to the requirements of Paragraph 4.2.K herein and the certain transferring other Loan Parties and/or affiliates of the transferring Other Loan Parties may qualify for a release from their recourse obligations under the Loan Documents under certain circumstances and subject to the requirements of Paragraph 4.2.K herein. 9.34 Standard of Conduct. Except where specifically provided otherwise herein, wherever this Instrument or any of the other Loan Documents requires or provide for Secured Party's review, approval or consent or that Secured Party must be satisfied or for the exercise of Secured Party's opinion, or that Secured Party may, at Secured Party's option, require something, Secured Party shall at all times (i) not unreasonably withhold, delay or condition such review, approval, consent or satisfaction; and (ii) act reasonably. In the event that Secured Party's review, approval, consent, satisfaction or opinion is required and Secured Party fails to review and respond negatively or disapprove or refuse Secured Party's consent or notify the Debtor of Secured Party's dissatisfaction or of Secured Party's unfavorable opinion within thirty (30) days after receipt of (x) Debtor's request therefor and (y) any and all documentation, instruments, materials or other information as Secured Party shall reasonably request, Secured Party's favorable review and response or approval or consent or notice of satisfaction or favorable opinion shall be deemed given; provided, however, that no earlier than ten (10) but no later than fifteen (15) days after Secured Party's review, approval, consent or opinion is requested and such materials and information are furnished, Debtor shall give Secured Party an additional written notice thereof, and shall specify that Secured Party's failure to respond by the specified date shall be deemed to constitute Secured Party's favorable review and response or approval or consent or notice of satisfaction or favorable opinion. The term "reasonably" shall not be interpreted as justifying arbitrary action but shall require a rational application of judgment, in accordance with current business policies of Secured Party (which policies shall be based on sound business judgment), concerning major shopping center lending transactions. 9.35 Certain Standards on Efforts of Debtor. Whenever in this instrument, or any other Loan Document, the phrase "cause to be" is used in conjunction with any of the obligations, such phrase shall be deemed to include the use by such parties, as the case may be, of Good Faith Efforts and all due diligence to cause the applicable act, event or circumstance to occur or be performed or taken, provided that such efforts and due diligence shall not encompass the initiation of litigation or other proceedings in order to enforce or bring about the happening of the applicable act or matter unless the failure to do so would constitute a material deviation from Approved Manager Business Practices. 9.36 Satisfaction and Cancellation. If the Obligations shall be fully paid and performed, then and in that event only Secured Party shall wholly release the Property and Collateral, at Debtor's sole cost and expense, from the liens, security interests, conveyances and assignments evidenced hereby, upon receipt by Secured Party of evidence satisfactory to it that the foregoing conditions have been satisfied. In such event Secured Party shall, at the request of Debtor, promptly deliver to Debtor, in recordable form, all such documents as shall be necessary to cause this Instrument to be satisfied and cancelled of record and to release the Property and Collateral from the liens, security interests, conveyances and assignments created or evidenced hereby and all rights hereunder shall terminate (except for the rights and obligations which expressly provides that it is to survive such satisfaction and release in accordance with the terms and provisions of this Instrument and the other Loan Documents including but without limitation those under the Hazardous Substances Remediation and Indemnification Agreement- Paragraph 9.26 herein, and Paragraph 9.27 herein and all indemnity rights that expressly survive as provided for herein referred to therein or set forth in this Instrument). 9.37 Counterparts. This Instrument may be executed in any number of counterparts with the same effect as if all parties hereto had executed the same document. All such counterparts shall be construed together and shall constitute one instrument, but in making proof hereof it shall only be necessary to produce one such counterparts containing, collectively, the signatures of all parties hereto. IN WITNESS WHEREOF, Debtor has caused this Instrument to be executed as of the day and year first above written. Signed, sealed and delivered in the presence of the following two witnesses: ____________________________ (signed name of witness one) ____________________________ (printed name of witness one) ____________________________ (signed name of witness two) ____________________________ (printed name of witness two) WEST DADE COUNTY ASSOCIATES, a Florida general partnership By: JMB/Miami International Associates, an Illinois general partnership as general partner of West Dade County Associates By: JMB Income Properties, Ltd.-XIII, an Illinois limited partnership as general partner of JMB/Miami International Associates By:JMB Realty Corporation, a Delaware corporation as Managing General Partner of JMB Income Properties, Ltd.-XIII By:______________ (signed name) ______________ (printed name) Its: ___________ (title) [CORPORATE SEAL] Signed, sealed and delivered in the presence of the following two witnesses: ____________________________ (signed name of witness one) ____________________________ (printed name of witness one) ____________________________ (signed name of witness two) ____________________________ (printed name of witness two) By: Urban Shopping Centers, L.P., an Illinois limited partnership as general partner of JMB/Miami International Associates By: Urban Shopping Centers, Inc., a Maryland corporation as general partner of Urban Shopping Centers, L.P. By:___________________ (signed name) ___________________ (printed name) Its:______________ (title) [CORPORATE SEAL] Signed, sealed and delivered in the presence of the following two witnesses: ____________________________ (signed name of witness one) ____________________________ (printed name of witness one) ____________________________ (signed name of witness two) ____________________________ (printed name of witness two) By: IDS/JMB Balanced Income Growth, Ltd., an Illinois limited partnership as general partner of JMB/Miami International Associates By: Income Growth Managers, Inc., an Illinois corporation as general partner of IDS/JMB Balanced Income Growth, Ltd. By:__________________ (signed name) __________________ (printed name) [CORPORATE SEAL] Signed, sealed and delivered in the presence of the following two witnesses: ____________________________ (signed name of witness one) ____________________________ (printed name of witness one) ____________________________ (signed name of witness two) ____________________________ (printed name of witness two) By: DeBartolo-Miami Associates, an Ohio general partnership as general partner of West Dade County Associates By: _______________________ Edward J. DeBartolo general partner of DeBartolo-Miami Associates Signed, sealed and delivered in the presence of the following two witnesses: ____________________________ (signed name of witness one) ____________________________ (printed name of witness one) ____________________________ (signed name of witness two) ____________________________ (printed name of witness two) By: DeBartolo Realty Partnership, L.P., a Delaware limited partnership as general partner of DeBartolo-Miami Associates By: Coral Square Associates, an Ohio corporation, as a general partner of DeBartolo Realty Partnership, L.P. By:__________________ (signed name) __________________ (printed name) Its:_____________ (title) Signed, sealed and delivered in the presence of the following two witnesses: ____________________________ (signed name of witness one) ____________________________ (printed name of witness one) ____________________________ (signed name of witness two) ____________________________ (printed name of witness two) By: The Edward J. DeBartolo Corporation, an Ohio corporation, as a general partner of DeBartolo Realty Partnership, L.P. By:__________________ (signed name) __________________ (printed name) Its:_____________ (title) [CORPORATE SEAL] Signed, sealed and delivered in the presence of the following two witnesses: ____________________________ (signed name of witness one) ____________________________ (printed name of witness one) ____________________________ (signed name of witness two) ____________________________ (printed name of witness two) By: M-I Mall, Inc., a Florida corporation as general partner of West Dade County Associates By: _______________________ (signed name) _______________________ (printed name) Its:__________________ (title) [CORPORATE SEAL] Signed, sealed and delivered in the presence of the following two witnesses: ____________________________ (signed name of witness one) ____________________________ (printed name of witness one) ____________________________ (signed name of witness two) ____________________________ (printed name of witness two) By: DeBartolo Realty Partnership, L.P., a Delaware limited partnership as general partner of West Dade County Associates By: Coral Square Associates, an Ohio corporation, as a general partner of DeBartolo Realty Partnership, L.P. By:__________________ (signed name) __________________ (printed name) Its:_____________ (title) Signed, sealed and delivered in the presence of the following two witnesses: ____________________________ (signed name of witness one) ____________________________ (printed name of witness one) ____________________________ (signed name of witness two) ____________________________ (printed name of witness two) By: The Edward J. DeBartolo Corporation, an Ohio corporation, as a general partner of DeBartolo Realty Partnership, L.P. By:__________________ (signed name) __________________ (printed name) Its:_____________ (title) [CORPORATE SEAL] STATE OF __________ ) ) s.s. COUNTY OF _________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared __________________ the _______________________________ of JMB Realty Corporation, a Delaware corporation, as general partner and on behalf of JMB Income Properties, Ltd.-XIII, an Illinois limited partnership acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he/she/they executed the foregoing instrument on behalf of JMB Realty Corporation, acting as general partner and on behalf of JMB Income Properties, Ltd.-XIII acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of _________________. ________________________________ Signature of Notary Public ________________________________ Printed Name of Notary Public My Commission expires: ________________________________ [Notary Seal] STATE OF __________ ) ) s.s. COUNTY OF _________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ________________ the _______________________________ of Urban Shopping Centers, Inc., a Maryland corporation, as general partner and on behalf of Urban Shopping Centers, L.P., an Illinois limited partnership acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he/she/they executed the foregoing instrument on behalf of Urban @hopping Centers, Inc. acting as general partner and on behalf of Urban Shopping Centers, L.P., acting as general partner and on behalf of JMB/Miami International Associates acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____day of _________________. ________________________________ Signature of Notary Public ________________________________ Printed Name of Notary Public My Commission expires: ________________________________ [Notary Seal] STATE OF __________ ) ) s.s. COUNTY OF _________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared _________________ the ______________________ of Income Growth Managers, Inc., an Illinois corporation, as general partner and on behalf of IDS/JMB Balanced Growth, Ltd., an Illinois limited partnership acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he/she/they executed the foregoing instrument on behalf of Income Growth Managers, Inc. acting as general partner and on behalf of IDS/JMB Balanced Growth, Ltd. acting as general partner and on behalf of JMB/Miami International Associates acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ____________. ________________________________ Signature of Notary Public ________________________________ Printed Name of Notary Public My Commission expires: ________________________________ [Notary Seal] STATE OF __________ ) ) s.s. COUNTY OF _________ ) BEFORE ME, a Notary public in for said County and State on the date below, personally appeared _____________________ as a general partner of Coral Square Associates, an Ohio general partnership acting an a general partner and on behalf of DeBartolo Realty Partnership L.P., a Delaware limited partnership, as general partner and on behalf of DeBartolo-Miami Associates, an Ohio general partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he executed the foregoing instrument on behalf of Coral Square Associates acting as general partner and on behalf of DeBartolo Realty Partnership, L.P. acting as general partner and on behalf of DeBartolo-Miami Associates acting an general Partner and on behalf of Went Dade County Associates. Said sermon or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ______________. ________________________________ Signature of Notary Public ________________________________ Printed Name of Notary Public My Commission expires: ________________________________ [Notary Seal] STATE OF __________ ) ) s.s. COUNTY OF _________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ________________ the ____________________ of The Edward J. DeBartolo Corporation, an Ohio corporation acting as a general partner and on behalf of DeBartolo Realty Partnership L.P., a Delaware limited Partnership, as general partner and on behalf of DeBartolo-Miami Associates, an Ohio general partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he executed the foregoing instrument on behalf of The Edward J. DeBartolo Corporation acting an general partner and on behalf of DeBartolo Realty Partnership, L.P. acting as general partner and on behalf of DeBartolo-Miami Associates acting an general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to as or have produced one of the following items of identification which in current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of _____________. ________________________________ Signature of Notary Public ________________________________ Printed Name of Notary Public My Commission expires: ________________________________ [Notary Seal] STATE OF __________ ) ) s.s. COUNTY OF _________ ) BEFORE ME, a notary public in and for said County and State on the date below, personally appeared _________________ the ____________________________ of M-I Mall, Inc., a Florida corporation, acting as general partner of and on behalf of West Dade County Associates, a Florida partnership and acknowledged that he/she/they executed the foregoing instrument as general partner and on behalf of M-I Mall Inc. acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oat and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ______________. ________________________________ Signature of Notary Public ________________________________ Printed Name of Notary Public My Commission expires: ________________________________ [Notary Seal] STATE OF __________ ) ) s.s. COUNTY OF _________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared __________________ the ____________________ of Coral Square Associates, an Ohio general partnership, acting as general partner of and on behalf of DeBartolo Realty Partnership, L.P., a Delaware limited partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership, and acknowledged that he executed the foregoing instrument on behalf of Coral Square Associates, acting as general partner of and on behalf of DeBartolo Realty Partnership, L.P., acting an general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which in current or has born issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____day of _____________. ________________________________ Signature of Notary Public ________________________________ Printed Name of Notary Public My Commission expires: ________________________________ [Notary Seal] STATE OF __________ ) ) s.s. COUNTY OF _________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared _________________ the _____________________ of The Edward J. DeBartolo Corporation, an Ohio corporation acting as general partner of and an behalf of DeBartolo Realty Partnership, L.P., a Delaware limited partnership acting as general partner of and on behalf of West Dade County Associates a Florida general partnership, and acknowledged that he executed the foregoing instrument on behalf of The Edward J. DeBartolo Corporation, acting as general partner of and on behalf of DeBartolo Realty Partnership, L.P., acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following item of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number a driver's license issued by a State of tho United States. In WITNESS WHEREOF I have affixed my notarial seal this ____ day of ______________. ________________________________ Signature of Notary Public ________________________________ Printed Name of Notary Public My Commission expires: ________________________________ [Notary Seal] STATE OF __________ ) ) s.s. COUNTY OF _________ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared EDWARD J. DEBARTOLO as general partner and on behalf of DeBartolo-Miami Associates, an Ohio general partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he executed the foregoing instrument as general partner and on behalf of DeBartolo-Miami Associates as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of _________________. ________________________________ Signature of Notary Public ________________________________ Printed Name of Notary Public My Commission expires: ________________________________ [Notary Seal] EXHIBIT A [CONSISTS OF EXHIBIT A-1 AND EXHIBIT A-2] EXHIBIT A-1 MIAMI INTERNATIONAL MALL DEVELOPER SITE (INCLUDES DEVELOPERS EXCHANGE PARCEL) 38.395 AC. PARCEL ONE Being a parcel of land located within Section 32, Township 53 South, Range 40 East, lying and being in Dade County, Florida and further bounded and described as follows: Beginning at a pipe in concrete marking the Southwest corner of said Section 32, thence N 1 degrees 43' 13" W, along the west line of said Section 32, a distance of 1202.07 feet to a point; thence N 88 degrees 16' 47" E, a distance of 88.99 feet to a point on the easterly right- of-way line of N. W. 107th Ave., said point also being the principal point and place of beginning of the following description; Thence N 1 degrees 43' 13" W, along said easterly right-of-way line, a distance of 400.06 feet to a point; thence N 88 degrees, 16' 47" E, a distance of 40.00 feet to a point; thence N 1 degrees 43' 13" W, a distance of 45.00 feet to a point; thence S 88 degrees 16' 47" W, a distance of 40.00 feet to a point on said easterly right-of-way line; thence N 1 degrees 43' 13" W, along said easterly right-of-way line, a distance of 416.68 feet to a point; thence S 46 degrees 43' 13" E, a distance of 104.65 feet to a point; thence N 88 degrees, 16' 47" E, a distance of 22.04 feet to a point; thence S 77 degrees, 21' 36" E, a distance of 87.18 feet to a point; thence S 63 degrees, 00' 00" E, a distance of 68.58 feet to a point; thence N 45 degrees 00' 00" E, a distance of 459.09 feet to a point; thence due north, a distance of 15.00 feet to a point; thence N 45 degrees 00' 00" W, a distance of 293.65 feet to a point; thence N 56 degrees 40' 50" W, a distance of 102.84 feet to a point; thence N 80 degrees 02' 25" W, a distance of 102.84 feet to a point; thence S 88 degrees 16' 47" W, a distance of 115.08 feet to a point; thence S 43 degrees 16' 47" W, a distance of 104.65 feet to a point on said easterly right-of-way line; thence N 1 degrees, 43' 13" W, along said easterly right-of-way line, a distance of 157.41 feet to a point; thence N 89 degrees 38' 52" E, a distance of 354.68 feet to a point; thence S 45 degrees 00' 00" E, a distance of 419.65 feet to a point; thence due east, a distance of 15.00 feet to a point; thence N 45 degrees 00' 00" E, a distance of 424.98 feet to a point; thence N 89 degrees 38' 52" E, a distance of 1194.28 feet to a point; thence S 1 degrees 43' 13" E, a distance of 1934.69 feet to a point; thence S 89 degrees 20' 56" W, a distance of 156.22 feet to a point; thence S 45 degrees 00' 00" W, a distance of 442.07 feet to a point; thence S 34 degrees 00' 00" E, a distance of 242.05 feet to a point; thence S 0 degrees 39' 04" E, a distance of 30.74 feet to a point; thence S 44 degrees, 20' 56" E, a distance of 104.65 feet to a point on the northerly right-of-way line of N. W. 12th St., thence S 89 degrees 20' 56" W, along said northerly right-of-way, a distance of 248.01 feet to a point; thence N 44 degrees 20' 56" E, a distance of 104.65 feet to a point; thence N 14 degrees 00' 00" W, a distance of 24.70 feet to a point; thence N 34 degrees 00' 00" W, a distance of 300.89 feet to a point; thence S 70 degrees 00' 00" W, a distance of 214.37 feet to a point; thence due west, a distance of 230.77 feet to a point; thence N 67 degrees 30' 00" W, a distance of 244.67 feet to a point; thence N 45 degrees 00' 00" W, a distance of 145.34 feet to a point; thence due west, a distance of 35.08 feet to a point; thence S 45 degrees 00' 00" W, a distance of 90.00 feet to a point; thence S 34 degrees 20' 59" W, a distance of 15.00 feet to a point; thence S 10 degrees 39' 01" E, a distance of 104.65 feet to a point on said northerly right-of - -way line of N. W. 12th St., thence N 55 degrees 39' 01" W, a distance of 120.00 feet to a point; thence continuing along said northerly right-of-way line, 124.97 feet along an arc to the left, having a radius of 994.93 feet and a chord of 124.89 feet, bearing N 59 degrees 14' 54.9" W to a point; thence N 79 degrees 20' 59" E, a distance of 106.89 feet to a point; thence N 34 degrees 20' 59" E, a distance of 20.00 feet to a point; thence N 45 degrees 00' 00" E, a distance of 113.60 feet to a point; thence due north, a distance of 14. 14 feet to a point; thence N 45 degrees 00' 00" W, a distance of 70.85 feet to a point; thence N 60 degrees 00' 00" W, a distance of 235.68 feet to a point; thence N 45 degrees 00' 00" W, a distance of 289.61 feet to a point; thence N 34 degrees,00' 00" W, a distance of 73.61 feet to a point; thence N 24 degrees 00' 00" W, a distance of 73.60 feet to a point; thence N 13 degrees 00' 00" W, a distance of 130.75 feet to a point; thence S 88 degrees 16' 47" W, a distance of 77.20 feet to a point; thence S 43 degrees 16' 47" W, a distance of 104.65 feet to a point on the easterly right-of-way line of N. W. 107th Ave., said point also being the principal point and place of beginning, but less and except the following parcels: 1. Sears Site (12.933 Ac.) described in Exhibit A-2 hereto. 2. Mervyn's Site (8.017 Ac.) described in Exhibit A-2 hereto. 3. Allied Site (10.095 Ac.) described in Exhibit A-2 hereto. 4. Federated Site (9.823 Ac.) described in Exhibit A-2 hereto. 5. Federated Site (Tract B) (4.235 Ac.) described in Exhibit A-2 hereto. 6. J. C. Penney Site (9.619 Ac.) described in Exhibit A-2 hereto. And containing a net acreage of 38.395 acres of land, more or less. EXHIBIT A-2 MIAMI INTERNATIONAL MALL SEARS SITE 12.993 ACRES Being a parcel of land located within Section 32, Township 53 South, Range 40 East, lying and being in Dade County, Florida and further bounded and described as follows: Beginning at a pipe in concrete marking the Southwest corner of said Section 32, thence N 1 degrees 43' 13" W, along the West line of said Section 32, a distance of 2644.15 feet to a point; thence N 89 degrees 38' 52" E, a distance of 1228.85 feet to a point; thence S 0 degrees 21' 08" E, a distance of 46.51 feet to the principal point and place of beginning of the following description: Thence due East, a distance of 280.00 feet to a point; thence 247.40 feet along an arc to the right, having a radius of 315.00 feet and a chord of 241.09 feet, bearing S 67 degrees, 30' 00" E to a point; thence S 45 degrees 00" E, a distance of 297.19 feet to a point; thence S 45 degrees 00' 00" W, a distance of 426.52 feet to a point; thence due West, a distance of 472.87 feet to a point; thence S 45 degrees 00' 00" W, a distance of 171.25 feet to a point; thence N 45 degrees 00' 00" W, a distance of 413.50 feet to a point; thence S 45 degrees 00' 00" W, a distance of 16.00 feet to a point; thence N 45 degrees 00' 00" W, a distance of 60.63 feet to a point; thence N 45 degrees 00' 00" E, a distance of 342.12 feet to a point; thence N 38 degrees 11' 22.8" E, a distance of 75.89 feet to a point; thence 267.04 feet along an arc to the right, having a radius of 340.00 feet and a chord of 260.22 feet, bearing N 67 degrees 30' 00" E to the principal point and place of beginning and containing 12.993 acres of land more or less. EXHIBIT A-2 MIAMI INTERNATIONAL MALL MERVYN'S SITE 8.017 ACRES Being a parcel of land located within Section 32, Township 53 South, Range 40 East, lying and being in Dade County, Florida and further bounded and described as follows: Beginning at a pipe in concrete, marking the Southwest Corner of said Section 32, thence N 89 degrees 20' 56" E, along the South line of said Section 32, a distance of 2250.00 feet to a point; thence N 1 degrees 43' 13" W, a distance of 1149.03 feet to a point; thence S 88 degrees 16' 47" W, a distance of 45.00 feet to the principal point and place of beginning of the following description: Thence 236.47 feet along an arc to the right, having a radius of 290.00 feet and a chord of 229.98 feet, bearing S 21 degrees 38' 23.5" W to a point; thence S 45 degrees 00' 00" W, a distance of 290.92 feet to a point; thence N 45 degrees 00' 00" W, a distance of 153.01 feet to a point; thence N 45 degrees 00' 00" E, a distance of 31.50 feet to a point; thence N 45 degrees 00' 00" W, a distance of 149.59 feet to a point; thence due West, a distance of 202.42 feet to a point; thence due North, a distance of 371.75 feet to a point; thence N 51 degrees 40' 46.4" E, a distance of 158.05 feet to a point; thence due North, a distance of 47.00 feet to a point; thence due East, a distance of 260.00 feet to a point; thence due South, a distance of 131.02 feet to a point; thence due East, a distance of 294.54 feet to a point; thence S 1 degrees 43' 13" E, a distance of 202.51 feet to the principal point and place of beginning and containing 8.017 acres of land more or less. EXHIBIT A-2 MIAMI INTERNATIONAL MALL ALLIED SITE 10.095 Acres Being a parcel of land located within Section 32, Township 53 South, Range 40 East, lying and being in Dade County, Florida and further bounded and described as follows: Beginning at a pipe in concrete marking the Southwest corner of said Section 32, thence N 89 degrees 20' 56" E, along the South line of said Section 32, a distance of 2250.00 feet to a point; thence N 1 degrees 43' 13" W, a distance of 1149.03 feet to a point; thence S 88 degrees 16' 47" W, a distance of 45.00 feet to a point; thence 236.47 feet along an arc to the right, having a radius of 290.00 feet and a chord of 229.98 feet, bearing S 21 degrees 38' 23.5" W to a point; thence S 45 00' 00" W, a distance of 322.42 feet to the principal point and place of beginning of the following description: Thence continuing S 45 degrees 00' 00" W, a distance of 73.99 feet to a point; thence S 49 degrees 38' 55" W, a distance of 238.24 feet to a point; thence 773.51 feet along an arc to the right, having a radius of 561.00 feet and a chord of 713.68 feet, bearing N 84 degrees 30' 00" W to a point; thence N 45 degrees 00' 00", W, a distance of 185.00 feet to a point; thence 12.12 feet, along an arc to the left, having a radius of 344.00 feet and a chord of 12.12 feet, bearing N 46 degrees 00' 35.1" W to a point; thence N 45 degrees 00 00" E, a distance of 197.85 feet to a point; thence N 45 degrees 00' 00" W, a distance of 31.50 feet to a point; thence N 45 degrees 00' 00" E, a distance of 198.00 feet to a point; thence S 45 degrees 00' 00" E, a distance of 63.25 feet to a point; thence due East, a distance of 522.94 feet to a point; thence S 45 degrees 00' 00" E, a distance of 365.60 feet to the principal point and place of beginning and containing 10.095 acres of land, more or less. EXHIBIT A-2 MIAMI INTERNATIONAL MALL FEDERATED SITE 9.823 ACRES Being a parcel of land located within Section 32, Township 53 South, Range 40 East, lying and being in Dade County, Florida and further bounded and described as follows: Beginning at a pipe in concrete marking the Southwest corner of said Section 32, thence N 1 degrees 43' 13" W, along the West line of said Section 32, a distance of 1274.13 feet to a point; thence N 88 degrees 16' 47" E, a distance of 314.64 feet to the principal point and place of beginning of the following description: Thence due North, a distance of 438.51 feet to a point; thence 259.97 feet along an arc to the right, having a radius of 331.00 feet and a chord of 253.34 feet, bearing N 22 degrees, 30' 00" E, to a point; thence N 45 degrees 00', 00" E, a distance of 102.22 feet to a point; thence S 45 degrees 00' 00" E, a distance of 231.63 feet to a point; thence N 45 degrees 00' 00" E, a distance of 31.50 feet to a point; thence S 45 degrees 00' 00" E, a distance of 265.98 feet to a point; thence due East, a distance of 84.63 feet to a point; thence due South, a distance of 407.00 feet to a point; thence due West, a distance of 194.94 feet to a point; thence S 45 degrees 00' 00" W, a distance of 410.62 feet to a point; thence N 45 degrees 00' 00" W, a distance of 62.43 feet to a point; thence 264.30 feet, along an arc to the right, having a radius of 336.52 feet and a chord of 257.56 feet, bearing N 22 degrees 30' 00" W to the principal point and place of beginning and containing 9.823 acres of land, more or less. EXHIBIT A-2 MIAMI INTERNATIONAL MALL FEDERATED SITE 4.235 AC. Being a parcel of land located within Section 32, Township 53 South, Range 40 East, lying and being in Dade County, Florida and further bounded and described as follows: Beginning at a pipe in concrete marking the Southwest corner of said Section 32, thence N 1 degrees 43' 13" W, along the West line of said Section 32, a distance of 2644.15 feet to a point; thence N 89 degrees 38' 52" E, a distance of 1717.66 feet to the principal point and place of beginning of the following description: Thence continuing N 89 degrees 38' 52" E, a distance of 532.59 feet to a point; thence S 1 degrees 43' 13" E, a distance of 476.94 feet to a point; thence S 45 degrees 00' 00" W, a distance of 105.72 feet to a point; thence N 45 degrees 00' 00" W, a distance of 721.50 feet to a point; thence N 45 degrees 00' 00" E, a distance of 53.79 feet to the principal point and place of beginning and containing 4.235 acres of land, more or less. EXHIBIT A-2 MIAMI INTERNATIONAL MALL PENNEY SITE 9.619 ACRES Being a parcel of land located within Section 32, Township 53 South, Range 40 East, lying and being in Dade County, Florida and further bounded and described as follows: Beginning at a pipe in concrete marking the southwest corner of said Section 32, thence N 89 degrees 20' 56" E along the south line of Section 32, a distance of 2250.00 feet to a point; thence N 01 degrees 43' 13" W, a distance of 1149.03 feet to a point; thence S 88 degrees 16' 47" W, a distance of 45.00 feet to a point; thence N 01 degrees 43' 13" W, a distance of 263.14 feet to a point, said point being the principal point and place of beginning of the following description: Thence due west, a distance of 244.73 feet to a point; thence due north, a distance of 102.00 feet to a point; thence due west, a distance of 432.00 feet to a point; thence due north, a distance of 386.97 feet to a point; thence N 45 degrees 00' 00" E, a distance of 532 .98 feet to a point; thence S 45 degrees 00' 00" E, a distance of 274.31 feet to a point; thence 237.94 feet along an arc to the right, having a radius of 315.00 feet and a central angle of 43 degrees 16' 47" to a point; thence S 01 degrees 43' 13" E, a distance of 458.80 feet to a point, said point being the principal point and place of beginning and containing 9.619 acres of land more or less. PARCEL TWO Being a parcel of land located within Section 32, Township 53 South, Range 40 East, lying and being in Dade County, Florida and further bounded and described as follows: Beginning at a pipe in concrete marking the Southwest corner of said Section 32, thence N 89 degrees 20' 56" E along the South line of said Section 32 a distance of 1496.98 feet to a point, said point also being on the South right-of-way line of N.W. 12th Street; thence N 89 degrees 20' 56" E along the South line of said section and also the South right-of-way line of N.W. 12th Street a distance of 753.02 feet to a point; thence N 01 degrees 43' 13" W a distance of 320.81 feet to the principal point and place of beginning of the following description: Thence S 89 degrees 20' 56" W a distance of 434.74 feet to a point; thence N 34 degrees 00' 00" W a distance of 81.20 feet to a point; thence N 45 degrees 00' 00" E a distance of 442.07 feet to a point; thence N 89 degrees 20' 56" E a distance of 156.22 feet to a point; thence S 01 degrees 43' 13" E a distance of 376.91 feet to the point of beginning and containing 2.960 acres of land more or less, but subject to all legal highways and easements of record. PARCEL THREE Easement Parcels Together with all easement rights in and to that certain Easement and Operating Agreement dated April 13, 1982, by and among Sears, Roebuck & Company, Alstores Realty Corporation, Jordan Marsh Company, Federated Department Stores, Inc., Associated Dry Goods Corporation and West Dade County Associates recorded on April 15, 1982 in Official Records Book 11411, Page 1044, Public Records of Dade County, Florida, as amended by First Amendment to the Easement and Operating Agreement dated October 22, 1991, by and among Sears, Roebuck & Company, Allied Stores General/Real Estate Company, Maas, Inc., Burdines Real Estate, Inc., J.C. Penney Company, Inc., Mervyn's and West Dade County Associates and recorded October 22, 1991 in Official Records Book 15238, Page 2289, Public Records of Dade County, Florida. EXHIBIT "B" SCHEDULE OF LEASED ASSETS Xerox copier and four Mobile-Com pagers. EX-99 6 EXHIBIT TO 10K LOAN NO. 6 100 405 FUTURE ADVANCE PROMISSORY NOTE $2,714,289.61 December __, 1993 FOR VALUE RECEIVED, the undersigned, WEST DADE COUNTY ASSOCIATES, a Florida general partnership, having offices in care of The Edward J. DeBartolo Corporation, 7620 Market Street, Youngstown, Ohio 44513-6085 ("Borrower") promises to pay to the order of THE PRUDENTIAL INSURANCE COMPANY OF AMERICA ("Lender"), (Lender and its successors and assigns who become holders of this Note are hereinafter collectively referred to as "Holder"), by Federal wire transfer to Holder at Morgan Guaranty Trust Company (ABA # 0210 00 238), 23 Wall Street, New York, New York 10019, Account No. 05054493, referencing Loan No. 6 100 405, or at such other place or manner as Holder may from time to time designate, the principal sum of TWO MILLION SEVEN HUNDRED FOURTEEN THOUSAND TWO HUNDRED EIGHTY-NINE AND 61/100THS DOLLARS ($2,714,289.61), or so much thereof as may be advanced by Holder to Borrower, together with interest on the Principal Balance from the date hereof until paid at the rates provided herein. 1. Definitions. For the purpose of this Note, the following terms shall have the meanings set forth below. Capitalized terms not otherwise defined herein shall have the meaning ascribed to such term in the Security Instrument. "Acceleration Notice" shall have the meaning set forth in Paragraph 5.1 of this Note. "DeBartolo" means DeBartolo, Inc. "DeBartolo Cap" shall have the meaning set forth in Paragraph 18 of this Note. "Discount Rate" means the rate which, when compounded monthly, is equivalent to the Treasury Rate when compounded semi-annually. "DRC" means DeBartolo Realty Corporation, an Ohio corporation. "DRPLP" means DeBartolo Realty Partnership, L.P., a Delaware limited partnership. "DeBartolo Loan Parties" shall have the meaning set forth in Paragraph 18 of this Note. "Exculpated Parties" shall have the meaning set forth in Paragraph 18 of this Note. "Interest Rate" means a rate of interest per annum of six and ninety-one hundredths percent (6.91%). "JMB Cap" shall have the meaning set forth in Paragraph 18 of this Note. "JMB Loan Parties" shall have the meaning set forth in Paragraph 18 of this Note. "Loan Documents" means this Note, the Security Instrument, the Modified and Restated Assignment of Lessor's Interest in Leases, the Agreement of Consolidation, Modification, Renewal and Restatement, the Hazardous Substances Remediation and Indemnification Agreement between Borrower, the Other Loan Parties and Lender of even date herewith, the Other Loan Party Agreement by and between the Other Loan Parties and Lender of even date herewith and all other documents now or hereafter governing, securing or evidencing the Indebtedness (as such term is defined in the Security Instrument). "Loan" means the loan evidenced by this Note. "Maturity" shall mean the Maturity Date or such earlier date as the entire principal balance of the Note may be due and payable by acceleration by the Holder as provided in this Note. "Maturity Date" means the 10th day of January, 1994. "Maximum Rate" shall have the meaning set forth in Paragraph 15 of this Note. "Monthly Due Date" means the 10th day of each calendar month during the term of the Loan. "Monthly Late Charge" means a late charge equal to four percent (4%) of the monthly interest payment or monthly principal and interest payment. "Other Loan Party" means any one of the Other Loan Parties. "Other Loan Parties" shall have the meaning set forth in the Security Instrument. "Per Diem Late Charge" means a late charge of $1,000.00 per day. "Prepayment Date" means any date, prior to the Maturity Date, upon which all or any portion of the Principal Balance is prepaid. "Prepayment Premium" shall have the meaning set forth in Paragraph 6.2 of this Note. "Present Value of the Loan" shall be determined by discounting all scheduled payments of principal and interest, remaining to the Maturity Date with respect to the amount being prepaid, at the Discount Rate. If prepayment occurs on a date other than a regularly scheduled payment date, the actual number of days remaining from the Prepayment Date to the next regularly scheduled payment date will be used to discount within this period. "Principal Balance" means the outstanding principal balance of this Note from time to time outstanding. "Real Estate Security" means the Land, as defined in the Security Instrument, the Improvements, as defined in the Security Instrument, all rents, issues, profits and proceeds therefrom, together with any interest in any ingress or egress easements, the developer's interest in the COREA, as defined in the Security Instrument, or other appurtenances, easements or Borrower's real property rights or interests relating thereto. "Secondary Interest Rate" means a rate of interest per annum equal to the lesser of (1) the maximum rate allowed by the law or (2) the rate which is the greater of (i) a per annum rate equal to four percent (4%) over the Interest Rate or (ii) a per annum rate equal to four percent (4%) over the prime rate (for corporate loans at large United States money center commercial banks) published in the Wall Street Journal on the first business day of each month in which such default occurs or continues. "Security Instrument" means that certain Modification, Renewal and Restatement of Mortgage and Security Agreement of even date herewith, executed by Borrower for the benefit of Holder as security for repayment of this Note. "Treasury Rate" means the semi-annual yield on the Treasury Constant Maturity Series with maturity equal to the remaining weighted average life of the Loan for the week prior to the Prepayment Date, as reported in Federal Reserve Statistical Release H.15 - Selected Interest Rates, conclusively (without manifest error) determined by Holder on the Prepayment Date. The rate will be determined by linear interpolation between the yields reported in Release H.15, if necessary. In the event Release H.15 is no longer published, Holder shall select a comparable publication to determine the Treasury Rate. 2. Payments. 2.1 Principal and interest hereunder shall be payable by Borrower to Holder as follows: (i) Interest only, in arrears, from the date of the Note through the 10th day of January, 1994 payable on the 10th day of January, 1994; and (ii) In any event, the entire unpaid balance of principal and accrued interest shall be due and payable on the Maturity Date. For any partial month, interest payments due under this Note shall be computed by dividing the actual number of days the Loan is outstanding by three hundred and sixty-five (365) days multiplied by the Principal Balance multiplied by the Interest Rate or Secondary Interest Rate, as the case may be. 2.2 Until directed otherwise in writing by Holder, all payments of principal, interest, and Prepayment Premium, if any, made under this Note shall be made by electronic funds transfer from a bank account established and maintained by Borrower for this purpose. Borrower covenants and agrees to so establish and maintain such an account with a depository satisfactory to Holder in Holder's reasonable discretion, and to direct the depository in writing to transfer such payments on their respective due dates to the account of Holder maintained at such depository as Holder and Borrower shall designate. Holder shall have the right, after thirty (30) days written notice to Borrower, to require Borrower to use a different depository or to select a different depository for Holder's account, if applicable as reasonably approved by Borrower. All costs of establishing and maintaining such accounts and all costs of such electronic funds transfers shall be paid by Borrower. Prior to each payment due date, Borrower shall deposit and/or maintain sufficient funds in Borrower's account to cover each debit entry. 2.3 THIS LOAN IS PAYABLE IN FULL ON THE 10TH DAY OF JANUARY, 1994. ON SAID MATURITY DATE YOU MUST REPAY THE ENTIRE PRINCIPAL BALANCE OF THE LOAN AND UNPAID INTEREST THEN DUE. THE PAYEE IS UNDER NO OBLIGATION TO RENEW, EXTEND OR REFINANCE THE LOAN AT THAT TIME. YOU WILL THEREFORE BE REQUIRED TO MAKE PAYMENT OUT OF THE COLLATERAL AND OTHER ASSETS YOU OWN ON THE MATURITY DATE UNLESS YOU FIND ANOTHER LENDER WHICH FUNDS AN AMOUNT SUFFICIENT TO ALLOW YOU TO PAY OFF THIS LOAN ON THE MATURITY DATE. 2.4 If the date for any payment hereunder falls on a day which is not a Business Day, then for all purposes hereof the same shall be deemed to have fallen on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of interest hereunder. 3. Treatment of Payments. All payments due under this Note shall be made without setoff, counterclaim, or deduction. Payments from Borrower to Holder under this Note shall be applied first to any expense reimbursements provided for under the Loan Documents as constituting additional indebtedness of Borrower to Holder, then to any accrued and unpaid Late Charges under this Note, then to accrued and unpaid interest under this Note and the balance to the Principal Balance and any Prepayment Premium due thereon. 4. Late Charges. 4.1If any monthly interest payment or monthly principal and interest payment is not paid in full on or before the Monthly Due Date for such payment, then a Per Diem Late Charge shall be assessed for each day that such payment is not paid from (and including) the first day after such Monthly Due Date to (and including) the date upon which such payment is made; provided, however, that if any such monthly interest payment or monthly principal and interest payment, together with all accrued Per Diem Late Charges, is not paid in full on or before the fifteenth day immediately following such Monthly Due Date for such payment, the Monthly Late Charge shall be deemed to be immediately assessed and shall be immediately due and payable as to such payment. The Monthly Late Charge shall be payable in lieu of and not in addition to any Per Diem Late Charges that shall have accrued during the two-week period immediately preceding the assessment of the Monthly Late Charge. Borrower acknowledges and agrees that its failure to make timely payments will result in Holder incurring additional expense in servicing the Loan, and that it is extremely difficult and impractical to ascertain the extent of such damages, and that the Per Diem Late Charge and Monthly Late Charge represent a fair and reasonable estimate, considering all of the circumstances existing on the date of the execution of this Note, of the costs that Holder will incur by reason of any such late payments. Acceptance of any Per Diem Late Charge and Monthly Late Charge shall not constitute a waiver of the default with respect to the late payment, and shall not prevent Holder from exercising any of the other rights or remedies available hereunder or at law or in equity. 4.2 The foregoing Per Diem Late Charge and Monthly Late Charge obligations shall not be assessed or imposed, and payments due under this Note shall not be deemed delinquent due to delays attributable to acts or causes directly related to the Electronic Fund Transfer System and beyond the control of Borrower. 5. Event of Default and Secondary Interest. 5.1 The occurrence of an "Event of Default" under any Loan Document shall constitute an Event of Default under this Note. Upon the occurrence of an Event of Default, Holder, at its option, may declare the Principal Balance together with all unpaid accrued interest, any Prepayment Premium and any other accrued and unpaid sums evidenced or secured by this Note or any Loan Document, to be immediately due and payable, without further presentment, demand, protest or notice of any kind, by so notifying Borrower in writing ("Acceleration Notice"). 6. Prepayment. 6.1 Subject to payment of the premium referred to below (unless any term or provision of a Loan Document expressly provides otherwise) and all accrued interest and other sums due under the Loan, if any, Borrower shall have the right to prepay all or part of the outstanding principal balance of the Loan on any date, upon giving not less than thirty (30) days prior written notice to Holder of its intention to prepay. 6.2 Except as to prepayments within ninety (90) days prior to the maturity of the Loan while there is no default by Borrower under the Loan Documents which has not been cured during any applicable grace, notice and cure periods prior to an acceleration by Holder (in which case the Prepayment Premium shall not be applicable), if the Loan is prepaid for any reason, whether voluntarily or involuntarily, or after acceleration by Holder upon a default by Borrower under the Loan Documents which has not been cured during any applicable grace, notice and cure periods, Borrower shall pay a prepayment premium ("Prepayment Premium") equal to the greater of (1) or (2) where: (1) is the product of (a) 1% of the principal amount of the Loan being prepaid multiplied by (b) the quotient of (i) the number of full months remaining to maturity of the Loan as of the Prepayment Date divided by (ii) the number of full months comprising the term of the Loan; and, (2) is an amount equal to the Present Value of the Loan less the amount of principal being prepaid including accrued interest, if any, calculated as of the Prepayment Date. Holder shall notify Borrower of the amount and basis of determination of the Prepayment Premium. On or before the Prepayment Date, Borrower shall pay to Holder the Prepayment Premium together with the amount of the principal being prepaid and all accrued interest and other sums due under the Loan. Holder shall not be obligated to accept any prepayment of the principal balance of the Loan unless such prepayment is accompanied by the Prepayment Premium and all accrued interest and other sums due under the Loan. 7. Security. This Note is secured, among other security, by the Security Instrument and the other Loan Documents, which contain provisions for the acceleration of the maturity of this Note upon the occurrence of certain described events. 8. Holder's Rights; No Waiver by Holder. The rights, powers and remedies of Holder under this Note shall be in addition to all rights, powers and remedies given to Holder under the Loan Documents and any other agreement or document securing or evidencing the Indebtedness or by virtue of any statute or rule of law, including, but not limited to, the Florida Uniform Commercial Code. All such rights, powers and remedies shall be cumulative and may be exercised successively or concurrently in Holder's sole discretion without impairing Holder's security interest, rights or available remedies. Subject to the provisions of Paragraph 9.34 of the Security Instrument, any forbearance, failure or delay by Holder in exercising any right, power or remedy shall not preclude further exercise thereof, and every right, power or remedy of Holder shall continue in full force and effect until such right, power or remedy is specifically waived in a writing executed by Holder. Borrower waives any right to require the Holder to proceed against any person or to exhaust any Property or to pursue any remedy in Holder's power. 9. Borrower's Waivers. 9.1 Except as expressly provided for in the Loan Documents Borrower and any endorsers of this Note, and each of them, hereby waive diligence, demand, presentment for payment, notice of non-payment, protest and notice of protest, and specifically consent to and waive notice of any renewals or extensions of this Note, whether made to or in favor of Borrower or any other person or persons. Borrower and any endorsers of this Note expressly waive all right to the benefit of any statute of limitations and any moratorium, reinstatement, marshalling, forbearance, extension, redemption, or appraisement now or hereafter provided by the Constitution and the laws of the United States and of any state thereof, as a defense to any demand against Borrower or any such endorsers, to the fullest extent permitted by law. 9.2 WAIVER OF TRIAL BY JURY. BORROWER HEREBY WAIVES,TO THE FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM FILED BY BORROWER OR HOLDER, WHETHER IN CONTRACT, TORT OR OTHERWISE, RELATING DIRECTLY OR INDIRECTLY TO THIS NOTE, THE LOAN, THE LOAN DOCUMENTS OR ANY ACTS OR OMISSIONS OF LENDER IN CONNECTION THEREWITH. 10. Transfers by Holder. This Note or any interest in this Note and the Loan Documents may be hypothecated, transferred or assigned by Holder without the prior consent of Borrower; provided, however, that Lender, upon the written request of Borrower made not more frequently than once during any calendar year shall disclose to Borrower the identity of all participants in the Loan and all assignees of the Loan. 11. Amendment. This Note may be amended or modified only by an instrument in writing which by its express terms refers to this Note and which is duly executed by the party sought to be bound thereby. 12. Successors and Assigns. This Note shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, personal representatives, successors and permitted assigns. 13. Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of Florida. 14. Time. Time is of the essence with respect to each and every term and provision of this Note. 15. No Usury. Under no circumstances shall the aggregate amount paid or agreed to be paid hereunder exceed the highest lawful rate permitted under applicable usury law (the "Maximum Rate") and the payment obligations of Borrower under this Note are hereby limited accordingly. If under any circumstances, whether by reason of advancement or acceleration of the unpaid principal balance hereof or otherwise, the aggregate amounts paid on this Note shall include amounts which by law are deemed interest and which would exceed the Maximum Rate, Borrower stipulates that payment and collection of such excess amounts shall have been and will be deemed to have been the result of a mistake on the part of both Borrower and Holder, and the party receiving such excess payments shall promptly credit such excess (to the extent only of such interest payments in excess of the Maximum Rate) against the unpaid principal balance hereof (without payment of any prepayment premium) and any portion of such excess payments not capable of being so credited shall be refunded to Borrower. 16. Notices. All notices, consents and other communications required or permitted by this Note shall be in writing and shall be given in the manner set forth in the Security Instrument. 17. Attorneys' Fees. The undersigned agrees to pay all costs, including reasonable attorneys' fee and expenses, incurred by Holder in enforcing payment or collection of this Note or the terms of any Loan Document in accordance with the Loan Documents (as reasonably construed by Holder), whether or not suit is filed. 18. Limitation on Personal Liability. Holder agrees, subject to the specific exceptions set forth below and not as to any Loan Document which expressly states it is not subject, in whole or in part, to this Limitation on Personal Liability provision (including, but not by way of limitation, the Hazardous Substances Remediation and Indemnification Agreement of even date herewith between Borrower, the Other Loan Parties and Lender and the Other Loan Party Agreement by and between the Other Loan Parties and Lender of even date herewith), to the extent the provisions of any such Loan Document expressly provides that all or any part of this paragraph is not applicable to any such document, that in enforcing any obligations under the Loan Documents its sole recourse shall be limited to the collateral for the Loan and it will look solely and only to such collateral in enforcing any such obligations. Further, subject to the specific exceptions set forth below and excluding any Loan Document which expressly states that it is not subject to this Limitation on Personal Liability provision to the extent the provisions of any such Loan Document expressly provides that all or any part of this paragraph is not applicable to any such document, neither Borrower, its partners nor any other Loan Party ("Exculpated Parties") shall have any personal liability under the Loan Documents, except that Borrower, its general partners (but not the partners of such parties unless they are also Other Loan Parties and/or any negative capital accounts of any partners not created for the purpose of evading liability hereunder), and the Other Loan Parties (but not the partners of such parties unless they are also other Loan Parties and/or any negative capital accounts of any partners not created for the purpose of evading liability hereunder) shall be jointly and severally liable for the payment of taxes, assessments and utility charges with respect to the Real Estate Security or any part thereof which become due and payable prior to the earlier to occur of (x) the Holder taking possession of the Real Estate Security, (y) the appointment of a receiver for the Real Estate Security or (z) the issuance of a certificate of title pursuant to a foreclosure sale of the Real Estate Security or upon Holder's acceptance of, in its sole discretion without regard to the Standard of Conduct, a deed-in-lieu of foreclosure and such joint and several liability as provided for under the ERISA paragraphs of the Security Instrument including the indemnification provisions thereof and for the Indemnity Obligations under and as defined in the Hazardous Substances Remediation and Indemnification Agreement of even date herewith between Borrower, the other Loan Parties and Lender and for the obligations of the Other Loan Parties under the Other Loan Party Agreement by and between the Other Loan Parties and Lender of even date herewith. Without limitation on the foregoing and notwithstanding anything to the contrary herein, in no event shall any of the partners, officers, directors, employees, or shareholders of the Exculpated Parties have any personal liability under the Loan Documents (unless they are either an entity which is a general partner of Borrower or an entity which is an Other Loan Party) and any negative capital account of any partners not created for the purpose of evading liability hereunder, shall not be available as collateral to the Holder. Moreover, after written notice from Holder to the Exculpated Parties, the agreement not to pursue recourse liability SHALL BECOME NULL AND VOID and of no further force and effect as to Borrower, its general partners and the other Loan Parties (but not the officers, directors, employees, or shareholders of Borrower's general partners and of the Other Loan Parties, any partners of Borrower's general partners unless they are also Other Loan Parties and any partners of the Other Loan Parties unless they are also Other Loan Parties nor any negative capital accounts of any partner not created for the purpose of evading any liability hereunder) in the event: (a) of actionable fraud or intentional material misrepresentation in connection with the Loan not cured within thirty (30) days after written notice of the same from Holder to Borrower (but not in addition to any cure period applicable to any written notice of default by Holder to Borrower given under the Loan Documents based on such occurrences); or (b) of the misapplication of (i) proceeds paid under any insurance policies by reason of damage, loss or destruction affecting any portion of the collateral for the Loan (to the full extent of such proceeds that were misapplied) not cured within thirty (30) days after written notice of the same from Holder to Borrower (but not in addition to any cure period applicable to any written notice of default by Holder to Borrower given under the Loan Documents based on such occurrences) (ii) any proceeds or awards resulting from the condemnation of all or any part of the collateral for the Loan (to the full extent of such proceeds or awards that were misapplied) not cured within thirty (30) days after written notice of the same from Holder to Borrower (but not in addition to any cure period applicable to any written notice of default by Holder to Borrower given under the Loan Documents based on such occurrences) or (iii) rents received after receipt by Borrower of any notice to which Borrower may be entitled, if any, of default or of foreclosure or of exercise of other remedies by Holder upon a default by Borrower; or (c) of any tenant security deposits not turned over to Holder upon foreclosure or sale pursuant to power of sale if, at such time, there is a legal duty to return said tenant security deposit to the depositing tenant, now or in the future, under the provisions of any such tenant's lease or under Florida law; or (d)of any intentional waste of any part of the collateral for the Loan not cured within thirty (30) days after written notice of the same from Holder to Borrower (but not in addition to any cure period applicable to any written notice of default by Holder to Borrower given under the Loan Documents based on such occurrences). The recourse liability resulting from (b), (c) and (d) above shall apply only to the extent of the lesser of (x) the amount involved in (b), (c), and (d) above, as applicable, and (y) the amount (the "Deficiency Amount"), if any, by which the sums owed under the Loan Documents exceed the fair market value of the collateral for the loan at the time of any foreclosure sale or deed in lieu of foreclosure as to said collateral. The foregoing provisions shall not limit or diminish Holder's other rights and remedies with respect to the collateral for the loan under any provisions of the Loan Documents or at law and in equity, including, without limitation, the right to foreclose, nor shall such provisions limit or diminish Holder's rights and remedies under any provisions of the Loan Documents in seeking personal liability therefor as to any of the above specific exceptions to the Limitation on Personal Liability provisions or as to any Loan Document which expressly states it is not subject to the above Limitation on Personal Liability provisions. Notwithstanding any term or provision contained herein or in the Loan Documents, the liability hereunder of Urban Shopping Centers, L.P., a Maryland limited partnership, JMB Income Properties, Ltd.-XIII, an Illinois limited partnership, and IDS/JMB Balanced Income Growth, Ltd., an Illinois limited partnership (collectively the "JMB Loan Parties") and each of them, jointly and severally among each other, shall not exceed fifty percent (50%) ("JMB Cap") of the total recourse dollar amount Holder would, but for the JMB Cap and DeBartolo Cap, be entitled to recover from all of the Other Loan Parties including the JMB Loan Parties plus interest on said amount at the Secondary Interest Rate, and reasonable out-of-pocket costs of enforcement and reasonable attorneys fees in recovering the same less any amounts realized by Holder from Borrower, all of the Other Parties and the collateral for the Loan (but not from The DeBartolo Loan Parties) in excess of the total nonrecourse dollar amount owed to Holder with no obligation to proceed against any of them. In no event however, should Holder collect more than one hundred percent (100%) of the sums due hereunder. The liability of DeBartolo, Inc., DeBartolo Realty Corporation, an Ohio corporation, and DeBartolo Realty Partnership, L.P., a Delaware limited partnership (collectively the "DeBartolo Loan Parties") and each of them, jointly and severally among each other, shall not exceed fifty percent (50%) ("DeBartolo Cap") of the total recourse dollar amount Holder would, but for the DeBartolo Cap and JMB Cap, be entitled to recover from all of the Other Loan Parties including the DeBartolo Loan Parties plus interest on said amount at the Secondary Interest Rate and reasonable out-of-pocket costs of enforcement and reasonable attorneys fees in recovering the same less any amounts realized by Holder from Borrower, all of the Other Parties and the collateral for the Loan (but not from the JMB Loan Parties) in excess of the total nonrecourse dollar amount owed to Holder with no obligation to proceed against any of them. In no event however, should Holder collect more than one hundred percent (100%) of the sums due hereunder. The JMB Cap and DeBartolo Cap shall not cause or create any obligation of Holder to collect all or any portion of the sums due hereunder or to enforce any obligation of Borrower, the JMB Loan Parties or the DeBartolo Loan Parties hereunder or of Borrower under the Loan Documents or to exercise any of Holder's rights or remedies as to the collateral for the Loan. The liability of the JMB Loan Parties, the DeBartolo Loan Parties and Borrower are primary and absolute obligations of each subject to the JMB Cap, in the case of the JMB Loan Parties, and the DeBartolo Cap, in the case of the DeBartolo Loan Parties. After a transfer pursuant to the provisions of Paragraph 4.2.E of the Security Instrument, the JMB Cap and DeBartolo Cap will no longer be applicable to the transferee pursuant to the provisions of Paragraph 4.2.E of the Security Instrument (transfers between JMB and DeBartolo Affiliates). Further, the Borrower and Other Loan Parties may qualify for a release from their recourse obligations under the Loan Documents under certain circumstances and subject to the requirements of Paragraph 4.2.B.(3) of the Security Instrument and the certain transferring Other Loan Parties and/or affiliates of the transferring Other Loan Parties may qualify for a release from their recourse obligations under the Loan Documents under certain circumstances and subject to the requirements of Paragraph 4.2.K of the Security Instrument. 19. Incorporation by Reference. The provisions of (i) Paragraph 9.34 of the Security Instrument governing the standard of conduct of Holder, (ii) Paragraph 6.1.D of the Security Instrument relating to Default Waivers, (iii) Paragraph 9.1 of the Security Instrument relating to the term "Debtor" are hereby incorporated herein by reference and shall be applicable to this instrument with "Debtor" therein to mean "Borrower" herein and "Secured Party" therein to mean "Holder" herein. EXECUTION AND NOTARIZATION PAGES FOLLOW WEST DADE COUNTY ASSOCIATES, a Florida general partnership By:JMB/Miami International Associates, an Illinois general partnership as general partner of West Dade County Associates By:JMB Income Properties, Ltd.- XIII, an Illinois limited partnership as general partner of JMB/Miami International Associates By:JMB Realty Corporation, a Delaware corporation as Managing General Partner of JMB Income Properties, Ltd.-XIII By:_______________________ (signed name) _______________________ (printed name) Its:_______________________ (title) [CORPORATE SEAL] By:Urban Shopping Centers, L.P., an Illinois limited partnership as general partner of JMB/Miami International Associates By:Urban Shopping Centers, Inc., a Maryland corporation as general partner of Urban Shopping Centers, L.P. By:_______________________ (signed name) _______________________ (printed name) Its:______________________ (title) [CORPORATE SEAL] By:IDS/JMB Balanced Income Growth, Ltd., an Illinois limited partnership as general partner of JMB/Miami International Associates By:Income Growth Managers, Inc., an Illinois corporation as general partner of IDS/JMB Balanced Income Growth, Ltd. By:_______________________ (signed name) _______________________ (printed name) Its:_______________________ (title) [CORPORATE SEAL] By:DeBartolo-Miami Associates, an Ohio general partnership as general partner of West Dade County Associates By:____________________________________ Edward J. DeBartolo, general partner of DeBartolo-Miami Associates By:DeBartolo Realty Partnership, L.P., a Delaware limited partnership as general partner of DeBartolo-Miami Associates By:Coral Square Associates, an Ohio general partnership, as a general partner of DeBartolo Realty Partnership, L.P. By: ___________________ (signed name) ___________________ (printed name) Its:___________________ (title) By:The Edward J. DeBartolo Corporation, an Ohio corporation, as a general partner of DeBartolo Realty By:_______________________ (signed name) _______________________ (printed name) Its:_______________________ (title) [Corporate seal] By:M-I Mall, Inc., a Florida corporation as general partner of West Dade County Associates By:_______________________ (signed name) _______________________ (printed name) Its:_______________________ (title) [CORPORATE SEAL] By:DeBartolo Realty Partnership, L.P., a Delaware limited partnership as general partner of West Dade County Associates By:Coral Square Associates, an Ohio general partnership, as general partner of DeBartolo Realty Partnership, L.P. By:_______________________ (signed name) _______________________ (printed name) Its:_______________________ (title) By:The Edward J. DeBartolo Corporation, an Ohio corporation, as a general partner of DeBartolo Realty Partnership, L.P. By:______________________ (signed name) ______________________ (printed name) Its:______________________ (title) [CORPORATE SEAL] STATE OF _______ ) ) ss. COUNTY OF ______ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared __________________, the _______________ of JMB Realty Corporation, a Delaware corporation, as general partner and on behalf of JMB Income Properties, Ltd.-XIII, an Illinois limited partnership acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he/she/they executed the foregoing instrument on behalf of JMB Realty Corporation, acting as general partner and on behalf of JMB Income Properties, Ltd.-XIII acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of _____________, 199_. _______________________________ Signature of Notary Public _______________________________ Printed Name of Notary Public My Commission expires: _______________________________ [Notary Seal] STATE OF ________ ) ) ss. COUNTY OF _______ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ____________________ the ________________ of Urban Shopping Centers, Inc., a Maryland corporation, as general partner and on behalf of Urban Shopping Centers, L.P., an Illinois limited partnership acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he/she/they executed the foregoing instrument on behalf of Urban Shopping Centers, Inc. acting as general partner and on behalf of Urban Shopping Centers, L.P., acting as general partner and on behalf of JMB/Miami International Associates acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of _______________, 199_. _______________________________ Signature of Notary Public _______________________________ Printed Name of Notary Public My Commission expires: _______________________________ [Notary Seal] STATE OF ________ ) ) ss. COUNTY OF _______ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ___________________ the __________________ of Income Growth Managers, Inc., an Illinois corporation, as general partner and on behalf of IDS/JMB Balanced Growth, Ltd., an Illinois limited partnership acting as general partner and on behalf of JMB/Miami International Associates, an Illinois general partnership acting as general partner of and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he/she/they executed the foregoing instrument on behalf of Income Growth Managers, Inc. acting as general partner and on behalf of IDS/JMB Balanced Growth, Ltd. acting as general partner and on behalf of JMB/Miami International Associates acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ________________, 199_. _______________________________ Signature of Notary Public _______________________________ Printed Name of Notary Public My Commission expires: _______________________________ [Notary Seal] STATE OF ________ ) ) ss. COUNTY OF _______ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared EDWARD J. DeBARTOLO as general partner and on behalf of DeBartolo-Miami Associates, an Ohio general partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he executed the foregoing instrument as general partner and on behalf of DeBartolo-Miami Associates as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of _____________, 199_. _______________________________ Signature of Notary Public _______________________________ Printed Name of Notary Public My Commission expires: _______________________________ [Notary Seal] STATE OF ________ ) ) ss. COUNTY OF _______ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ____________________ as a general partner of Coral Square Associates, an Ohio general partnership acting as a general partner and on behalf of DeBartolo Realty Partnership L.P., a Delaware limited partnership, as general partner and on behalf of DeBartolo-Miami Associates, an Ohio general partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he executed the foregoing instrument on behalf of Coral Square Associates acting as general partner and on behalf of DeBartolo Realty Partnership, L.P. acting as general partner and on behalf of DeBartolo-Miami Associates acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of _______________, 199_. _______________________________ Signature of Notary Public _______________________________ Printed Name of Notary Public My Commission expires: _______________________________ [Notary Seal] STATE OF ________ ) ) ss. COUNTY OF _______ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ________________, the _________________ of The Edward J. DeBartolo Corporation, an Ohio corporation acting as a general partner and on behalf of DeBartolo Realty Partnership L.P., a Delaware limited partnership, as general partner and on behalf of DeBartolo-Miami Associates, an Ohio general partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he executed the foregoing instrument on behalf of Coral Square Associates acting as general partner and on behalf of DeBartolo Realty Partnership, L.P. acting as general partner and on behalf of DeBartolo-Miami Associates acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ________________, 199_. _______________________________ Signature of Notary Public _______________________________ Printed Name of Notary Public My Commission expires: _______________________________ [Notary Seal] STATE OF ________ ) ) ss. COUNTY OF _______ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ________________, the _____________ of M-I Mall, Inc., a Florida corporation acting as a general partner of and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he/she/they executed the foregoing instrument as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ______________, 199_. _______________________________ Signature of Notary Public _______________________________ Printed Name of Notary Public My Commission expires: _______________________________ [Notary Seal] STATE OF ________ ) ) ss. COUNTY OF _______ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ____________________ as a general partner of Coral Square Associates, an Ohio general partnership acting as general partner of and on behalf of DeBartolo Realty Partnership L.P., a Delaware limited partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he executed the foregoing instrument on behalf of Coral Square Associates acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ________________, 199_. _______________________________ Signature of Notary Public _______________________________ Printed Name of Notary Public My Commission expires: _______________________________ [Notary Seal] STATE OF ________ ) ) ss. COUNTY OF _______ ) BEFORE ME, a Notary Public in and for said County and State on the date below, personally appeared ______________, the ________________ of The Edward J. DeBartolo Corporation, an Ohio corporation acting as general partner and on behalf of DeBartolo Realty Partnership L.P., a Delaware limited partnership acting as general partner and on behalf of West Dade County Associates, a Florida general partnership and acknowledged that he executed the foregoing instrument on behalf of The Edward J. DeBartolo Realty Corporation, acting as general partner of and on behalf of DeBartolo Realty Partnership, L.P., acting as general partner and on behalf of West Dade County Associates. Said person or persons did not take an oath and are personally known to me or have produced one of the following items of identification which is current or has been issued within the past five (5) years and bears a serial or other identifying number: a driver's license issued by a State of the United States. IN WITNESS WHEREOF, I have affixed my notarial seal this ____ day of ____________, 199_. _______________________________ Signature of Notary Public _______________________________ Printed Name of Notary Public My Commission expires: _______________________________ [Notary Seal] Florida Documentary Stamps in the amount of $__________ have been affixed to the Modification, Renewal and Restatement of Mortgage and Security Agreement securing this Note and said stamps have been duly cancelled. EX-24 7 EXHIBIT TO 10K POWER OF ATTORNEY ----------------- KNOW ALL MEN BY THESE PRESENTS, that the undersigned officer and directors of JMB Realty Corporation, the managing general partner of JMB Income Properties, Ltd. - XIII, do hereby nominate, constitute and appoint GARY NICKELE, GAILEN J. HULL, DENNIS M. QUINN or any of them, attorneys and agents of the undersigned with full power of authority to sign in the name and on behalf of the undersigned officer or directors a Report on Form 10-K of said partnership for the fiscal year ended December 31, 1993, and any and all amendments thereto, hereby ratifying and confirming all that said attorneys and agents and any of them may do by virtue hereof. IN WITNESS WHEREOF, the undersigned have executed this Power of Attorney the 26th day of January, 1994. STUART C. NATHAN _________________________ Executive Vice President and Director of Stuart C. Nathan General Partner A. LEE SACKS _________________________ Director of General Partner A. Lee Sacks The undersigned hereby acknowledge and accept such power of authority to sign, in the name on behalf of the above named officer and directors, a Report on Form 10-K of said partnership for the fiscal year ended December 31, 1993, and any and all amendments thereto, the 26th day of January, 1994. GARY NICKELE ______________________ Gary Nickele GAILEN J. HULL ______________________ Gailen J. Hull DENNIS M. QUINN ___________________________ Dennis M. Quinn EX-24 8 EXHIBIT TO 10K POWER OF ATTORNEY ----------------- KNOW ALL MEN BY THESE PRESENTS, that the undersigned officers and directors of JMB Realty Corporation, the managing general partner of JMB INCOME PROPERTIES, LTD. - XIII, do hereby nominate, constitute and appoint GARY NICKELE, GAILEN J. HULL, DENNIS M. QUINN or any of them, attorneys and agents of the undersigned with full power of authority to sign in the name and on behalf of the undersigned officer or directors a Report on Form 10-K of said partnership for the fiscal year ended December 31, 1993, and any and all amendments thereto, hereby ratifying and confirming all that said attorneys and agents and any of them may do by virtue hereof. IN WITNESS WHEREOF, the undersigned have executed this Power of Attorney the 23rd day of March, 1994. JUDD D. MALKIN ________________________________________ Chairman and Director Judd D. Malkin NEIL G. BLUHM ________________________________________ President and Director Neil G. Bluhm H. RIGEL BARBER ________________________________________ Chief Executive Officer H. Rigel Barber JEFFREY R. ROSENTHAL ________________________________________ Chief Financial Officer Jeffrey R. Rosenthal The undersigned hereby acknowledge and accept such power of authority to sign, in the name and on behalf of the above named officer and directors, a Report on Form 10-K of said partnership for the fiscal year ended December 31, 1993, and any and all amendments thereto, the 23rd day of March, 1994. GARY NICKELE _______________ Gary Nickele GAILEN J. HULL _________________ Gailen J. Hull DENNIS M. QUINN _________________ Dennis M. Quinn -----END PRIVACY-ENHANCED MESSAGE-----