2006 FOR VALUE RECEIVED, the und - FCI Exchange

$96,000.00
PROMISSORY NOTE
SECURED BY PLEDGE AGREEMENT
Los Angeles, California
November -!i2.-, 2006
FOR VALUE RECEIVED, the undersigned,_ an individual,
promises to pay to the order of ("Lender"),
the principal sum of Ninety-six Thousand Dollars ($96,000.00), plus interest on the unpaid
principal balance thereof at the rate set forth below (the" Interest Rate") and payable in monthly
installments, interest only, on the first day of each month, beginning on , 2006.
The outstanding principal balance owing under this Note, together with all accrued but unpaid
interest, shall be due and payable in full on November 2016 (the" Maturity Date").
The Interest Rate shall be the six month LIBOR rate (London Interbank Offered rate)
published in the Wall Street Journal plus 5.8% per annum. The initial Interest Rate shall be
eleven percent (11 %) per annum. The Interest Rate shall be adjusted on May 1 and November
1 (the" Interest Rate Change Dates") thereafter each year. Should the Interest Rate Change
Date fall on a date such newspaper is not published, the Interest Rate shall be determined to be
the six month LIBOR rate published in the Wall Street Journal on the next business day. If at
any time Lender determines that the adequate and fair means do not exist for ascertaining the
Interest Rate applicable in respect of any period, Lender shall forthwith give notice of such
event to the undersigned and advise the undersigned of an alternative basis (in order to obtain
substantially the same result) acceptable to Lender for computing the Interest Rate which shall
be applicable for calculating interest accruing under this Note.
Notwithstanding anything to the contrary above, in no event shall the Interest Rate ever
exceed eighteen percent (18 %) and in no event shall any change in the Interest Rate on any
single Interest Rate Change Date exceed three percent (3% ). The above cap on the Interest
Rate means in no event will the Default Rate (as defined below) ever exceed twenty-one
percent (21 %) per annum.
Until the third anniversary of the date the loan evidenced by this Note is funded by
Lender, in the event of any prepayment by the undersigned, the undersigned shall pay a
prepayment premium to Lender equal to 80% of six months interest on the amount so prepaid.
After the third anniversary of the date the loan evidenced by this Note is funded by Lender, the
undersigned may prepay this Note in whole or part without penalty or premium.
All interest calculations under this Note shall be based upon a 360 day year on the basis
of the number of actual days elapsed.
This Note is secured by a Pledge Agreement (the "Pledge Agreement") dated of even
date herewith executed by the undersigned, as "Pledgor," in favor of Lender, as "Beneficiary, n
covering a Certificate of Beneficial Ownership and Interest (the "Certificate") concerning a
beneficial trust interest in that' certain trust operating an unincorporated cooperative known as the

Glen-Donald Apartments (the" Trust"), which owns the real property located a••••••
•••••••••••••••• ~, situated in the County of Los Angeles, State of
California (the " Property").
All payments on this Note shall, at the option of the holder hereof, be applied first to the
payment of accrued and unpaid interest, and after all such interest has been paid, any remainder
shall be applied to reduction of the principal balance.
The undersigned acknowledges that if any payment required under this Note is not paid
within fifteen (15) days after the same becomes due and payable, the holder hereof will incur
extra administrative expenses, in addition to expenses incident to receipt of timely payment, and
the loss of the use of funds in connection with the delinquency in payment. Because, from the
nature of the case, the actual damages suffered by the holder hereof by reason of such extra
administrative expenses and loss of use of funds would be impracticable or extremely difficult to
ascertain, the undersigned agrees that five percent (5%) of the amount of the delinquent payment
and the imposition of the default interest rate provided for below shall be the amount of damages
to which such holder is entitled, upon such breach, in compensation therefor. The undersigned
shall, therefore, in such event, without further notice, pay to the holder hereof as such holder's
sale monetary recovery to cover such extra administrative expenses and loss of use of funds,
liquidated damages in the amount of five percent (5%) of the amount of such delinquent payment
and any additional interest owed as a result of the. imposition of the default interest rate as
provided below. The provisions of this paragraph are intended to govern only the determination
of damages in the event of a breach in the performance of the obligation of the undersigned to
make timely payments hereunder. Nothing in this Note shall be construed as an express or
implied agreement by the holder hereof to forbear in the collection of any delinquent payment, or
be construed as in any way giving the undersigned the right, express or implied, to fail to make
timely payments hereunder, whether upon payment of such damages or otherwise. The right of
the holder hereof to receive payment of such liquidated and actual damages, and receipt thereof,
are without prejudice to the right of such holder to collect such delinquent payments and any
other amounts provided to be paid hereunder or under any security for this Note or to declare a
default hereunder or under any security for this Note.
All payments on this Note are to be made payable to Lender's servicing agent, FC!
National Lender Services whose address for this purpose is 8180 East Kaiser Boulevard,
Anaheim Hills, California 92808 or to such other person or at such other place as the holder
hereof may from time to time direct by written notice to the undersigned.
The undersigned waives any right of offset it now has or may hereafter have against the
holder hereof and its successors and assigns, and agrees to make the payments called for
hereunder in accordance with the terms hereof. The holder hereof and all successors thereof
shall have all the rights of a holder in due course as provided in the California Uniform
Commercial Code and other laws of the State of California.
The undersigned and any endorsers, guarantors or sureties hereof severally waive
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presentment and demand for payment, notice of intent to accelerate maturity, protest or notice of
protest or non-payment, bringing of suit and diligence in taking any action to collect any sums
owing hereunder or in proceeding against any of the rights and properties securing payment
hereunder; expressly agree that this Note, or any payment hereunder, may be extended from time
to time; and consent to the acceptance of further security or the release of any security for this
Note, all without in any way affecting the liability of the undersigned and any endorsers or
guarantors hereof. No extension of time for the payment of this Note, or any installment hereof,
made by agreement by the holder hereof with any person now or hereafter liable for the payment
of this Note, shall affect the original liability under this Note of the undersigned, even if the
undersigned is not a party to such agreement.
The failure of the undersigned to payor perform as required hereunder or the default of
the undersigned under the Pledge Agreement or any other instrument securing this Note or
secured by the Pledge Agreement shall constitute a default hereunder. Upon the occurrence of a
default hereunder, at the option of the holder hereof, all amounts then unpaid under this Note, the
Pledge Agreement or any other instrument securing this Note or secured by the Pledge
Agreement shall bear interest for the period beginning with the date of occurrence of such default
at a default rate equal to three percent (3%) above the rate stated herein (the" Default Rate"),
payable monthly on the fIrst day of each and every month, and in addition such holder may, at its
option, declare immediately due and owing the entire unpaid principal sum together with all
interest thereon, plus any other sums owing at the time of such declaration pursuant to this Note,
the Pledge Agreement or any other instrument securing this Note.
The failure to exercise the foregoing option shall not constitute a waiver of the right to
exercise the same at any subsequent time in respect of the same event or any other event. The
acceptance by the holder hereof of any payment hereunder which is less than payment in full of
all amounts due and payable at the time of such payment shall not constitute a waiver of the right
to exercise any of the foregoing options at that time or at any subsequent time or nullify any prior
exercise of any such option without the express consent of such holder, except as and to the
extent otherwise provided by law.
All amounts payable hereunder are payable in lawful money of the United States.
The undersigned agrees to pay all costs of collection when incurred, including reasonable
attorneys' fees, whether or not an action shall be instituted to enforce this Note.
Neither the Certificate, nor the undersigned's interest in the Trust or the
Property, shall be sold, agreed to be sold, conveyed, transferred, assigned, disposed of, or
further encumbered, whether voluntarily, involuntarily, by operation of law or otherwise,
without the written consent of the holder hereof being fIrst obtained, which consent may be
withheld in holder' s sale and absolute discretion. Any transaction in violation of the above
restrictions shall cause the then outstanding principal balance and interest thereon and other sums
secured by said Pledge Agreement, at the option of said holder, to immediately become due and
payable.
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3

The parties hereto intend to conform strictly to the applicable usury laws. In no
event, regardless of any provisions contained therein or in any other document executed or
delivered in connection herewith, shall the holder hereof ever be deemed to have contracted for
or be entitled to receive, collect or apply as interest on this Note, any amount in excess of the
maximum amount permitted by applicable law (the" Maximum Rate"). In no event, whether
by reason of demand for payment, prepayment, acceleration of the maturity hereof or
otherwise, shall the interest contracted for, charged or received by the holder hereunder or
otherwise exceed the Maximum Rate. If for any circumstance whatsoever interest would
otherwise be payable to the holder in excess of the maximum lawful amount, the interest
payable to the holder shall be reduced automatically to the Maximum Rate.
This Note is subject to Section 2966 of the Civil Code, which provides that the holder
of this Note shall give written notice to the undersigned, or his successor in interest, of
prescribed information at least 90 and not more than 150 days before any balloon payment is
due.
California.
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This Note shall be governed by and construed according to the laws of the State of
'-~---"-"'----""-'-'-'-'-"-'---'-"-"'--"-'-_.---~._-- -.-_ .._._--.------:._---- ..-._--_...,-_._-_ .•.----_.,-_ __._._-_ _-_ .._.._..__ ._.._---_ _----- -_.-----_ ---_..•-----_. _.•_ _- _ .
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PLEDGE AGREEMENT
This Pledge Agreement (" Agreement") is made and entered into as of November __ '
20~ (" Pledgor") and
~a California limited liability company (" Lender").
Recitals
A. Lender has agreed to advance certain funds to Pledgor (the" Loan"), pursuant to
that certain Secured Promissory Note in the amount of Ninety-six Thousand Dollars ($96,000.00)
dated of even date therewith (the" Note"), which indebtedness is secured by this Agreement (the
Note and this Agreement shall be referred to herein together as the " Loan Documents").
B. The purpose of the Loan is to enable Pledgor to purchase a beneficial trust interest
in the Glen-Donald Apartments, an unincorporated cooperative (the" Glen-Donald Apartments")
governed by that certain Declaration of Trust dated September 16, 1925 (the" Trust").
C. To induce Lender to loan funds to Pledgor, Pledgor has agreed to pledge his
beneficial interest in the Trust to Lender as security for the repayment of all indebtedness due
under the Loan Documents.
For good and valuable consideration, receipt of which is acknowledged, the parties hereby
agree as follows:
ARTICLE I
PLEDGE OF BENEFICIAL INTEREST
Pledgor hereby pledges, assigns and grants a security interest to Lender in all of Pledgor' s
right title and interest represented by Certificate of Beneficial Ownership and Interest No.
_____ (the " Certificate") relating to the Glen-Donald Apartments, duly endorsed in blank
and delivered to Lender (the" Collateral") as security for the repayment of all indebtedness due
under the Loan Documents. Pledgor hereby appoints Lender as his attorney-in-fact to arrange for
the transfer of the Collateral on the books of the trustee of the Trust to the name of Lender.
ARTICLE II
VOTING RIGHTS; DISTRIBUTIONS
Prior to the occurrence of an Event of Default (as defined in Section 6.1 below):
Section 2.1 Voting. Pledgor shall be entitled to exercise any and all voting and/or
consensual rights and powers relating to or pertaining to Collateral or any part thereof given as
security for repayment of the Note for any purpose not in violation of the terms of this Agreement;
provided, however, that Pledgor shall not be permitted to exercise or refrain from exercising any
such right or power if, in the reasonable judgment of Lender, such action would have a material
adverse effect on the value of the Collateral or any part thereof; and, provided, further, that

Pledgor shall give Lender at least ten (10) days written notice of the manner in which Pledgor
intends to exercise, or the reasons for refraining from exercising, any such right or power other
than with respect to the election of a board of governors and voting with respect to incidental
matters at any meeting of holders of beneficial trust interest'. in the Trust. Notwithstanding
anything to the contrary in this Agreement, in no event may Pledgor vote to dissolve the Trust
without Lender' s prior written consent, which may be withheld in Lender' s sole and absolute
discretion.
Section 2.2 Distributions. Until repayment in full of the Loan, Lender shall be entitled
to receive and retain any and all dividends or distributions and interest payable on the Collateral;
provided, however, that any and all such dividends, distributions or interest shall be applied to
amounts owing on the Loan.
Section 2.3 Execution of Instruments. Lender shall execute and deliver (or cause to be
executed and delivered) to Pledgor all such proxies, powers of attorney, dividend orders, interest
coupons and other instruments as Pledgor may reasonably request for the purpose of enabling
Pledgor to exercise the voting and/or consensual rights and powers which it is entitled to exercise
pursuant to Section 2.1 above and/or to receive the dividends and/or interests payments which it is
authorized to receive and retain pursuant to Section 2.2 above.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Pledgor warrants and represents that:
Section 3.1 Ownership of Collateral. Pledgor is the sole legal and beneficial owner of
the Collateral;
Section 3.2 Transfer. Pledgor has the right to transfer the Collateral and that the
Collateral free of any encumbrances, liens or claims;
Section 3.3 Legal Valid and Binding Obligation of Pledgor. With respect to the
Collateral, this Agreement constitutes the legal, valid and binding obligation of Pledgor
enforceable against Pledgor in accordance with its terms except as enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles relating
to or limiting creditors' rights generally;
Section 3.4 Valid Security Interest and Lien. With respect to the Collateral, this
Agreement creates a valid security interest and lien in and upon the Collateral pledged or assigned
hereunder;
Section 3.5 No Defenses. No dispute, right of setoff, counterclaim or defense exists
with respect to all or any part of the Collateral;
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Section 3.6 No Hypothecation. The Collateral is not subject to any liens, security
interests or encumbrances whatsoever;
Section 3.7 No Consents. The execution, delivery and performance hereof are not in
contravention of any indenture, agreement or undertaking to which Pledgor is a party or by which
Pledgor is bound; and other than approval of the Board of Governors of the Trust, no
authorization, approval or other action is required either for the grant by Pledgor of the security
interest granted hereby or for the execution, delivery or performance of this Agreement by
Pledgor.
ARTICLE IV
COVENANTS AND AGREEMENTS OF PLEDGOR
Pledgor covenants and agrees as follows:
Section 4.1 Delivery of Collateral. Pledgor will deliver to Lender the original
Certificate evidencing the Collateral to Lender;
Section 4.2 Further Acts and Assurances. Pledgor shall from time to time promptly
execute and deliver to Lender all such other assignments, certificates, supplemental writings, ..trust
receipts, escrow agreements and financing statements and do all other acts or things as Lender may
reasonable request in order to more fully evidence and perfect the security interest in the
Collateral. Pledgor shall at Pledgor's own cost and expense execute and deliver such further
documents and instruments and shall take such other actions as may be reasonably required or
requested by Lender to carry out the intent and purposes of this Agreement;
Section 4.3 No Transfer or Hypothecation. Pledgor will not, without the prior written
consent of Lender, transfer any of Pledgor's rights in the Collateral or create any lien or
otherwise encumber the Collateral or permit any of the Collateral to ever be or become subject to
any lien, attachment, execution, sequestration, or encumbrance of any kind, except Lender's
security interest in the Collateral;
Section 4.4 Enforcement. Pledgor shall enforce, or secure in the name of Lender, the
performance of each and every obligation, term, covenant, condition and agreement in or
pertaining to the Collateral by any other party thereunder to be performed, and Pledgor shall
appear in and defend any action or proceeding arising under, occurring out of or in any manner
connected with the Collateral or the obligations, duties or liabilities of any other party thereunder,
and upon request by Lender, Pledgor will do so in the name and on behalf of Lender, but at the
expense of the Pledgor, and Pledgor shall pay all costs and expenses of Lender, including but not
limited to, reasonable attorneys' fees and disbursements in any action or proceeding in which
Lender may appear;
Section 4.5 Further Information. Pledgor shall promptly furnish to Lender any
information or writings which Lender may reasonably request concerning the Collateral;
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-_..__._--.__ ._.__ .__ .•.- _ _.•.--_ _ -.-•....-.- _ .......•-_.__._.__ ..-_._,._._._-,.,.--~--~_.__.-.._-_ ...•- ,- _ ..-•._---_._-_._-- ,.,'--_.._--- •..._._ ,.._ ,., _.._ --.....•.... _._ .....•_-- .
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Section 4.6 Inspection. Pledgor shall allow Lender to inspect all records of Pledgor
relating to the Collateral or the secured indebtedness, and to make and take away copies of such
records during normal business hours;
Section 4.7 Changes. Pledgor shall promptly notify Lender of any material change in
any fact or circumstances warranted or furnished by Pledgor to Lender in connection with the
Collateral. and
Section 4.8 Claims. Pledgor shall promptly notify Lender of any claim, action or
proceeding affecting title to the Collateral, or any part thereof, or the security interest created
hereunder, and Pledgor will appear in, contest and defend against any action or proceeding
purporting to affect title to, or any other interest in, any portion of the Collateral, or the rights or
powers of Lender, its successors assigns, or the right or interest of Lender, legal or beneficial, in
any portion of the Collateral. Pledgor waives any right it may have to require Lender to pursue
any third party for obligations with respect to the Collateral.
ARTICLE V
CERTAIN RIGHTS OF LENDER
Section 5.1 Proceeds of Collateral. Should the Collateral of any part thereof ever be in
any manner converted by Pledgor into another type of property, or any money or other proceeds
ever be paid or delivered to Pledgor as a result of Pledgor' s rights in the Collateral, then in any
such event, all such property, money, and other proceeds shall immediately be and become part of
the Collateral and Pledgor covenants to forthwith pay and deliver all money so received to Lender;
provided however, that prior to the occurrence of an Event of Default Pledgor shall be entitled to
retain any cash dividend issued in the ordinary course of business and. not in liquidation or
dissolution of the Collateral. If Lender deems it necessary and so requests, Pledgor shall properly
endorse or assign any and all such proceeds to Lender and deliver to Lender any and all other
proceeds that require perfection by possession under the California Commercial Code. With
respect to any property of a kind requiring an additional security agreement, fmancing statement or
other writing to perfect a security interest in it in favor of Lender, Pledgor will execute and deliver
to Lender whatever Lender deems necessary or proper for that purpose ..
Section 5.2 Preservation of Collateral. Lender shall never be liable for failure to use
diligence to collect any amount payable with respect to the Collateral, or any part thereof, but shall
be liable only to account to Pledgor for that which Lender may actually collect or receive thereon.
Section 5.3 Financing Statements. Pledgor hereby authorizes Lender to file fmancing
statements and amendments thereto relative to all or any part of the Collateral where necessary or
desirable in Lender's judgment to perfect or to continue the security interest granted herein
without the signature of Pledgor.
Section 5.4 Other Security. Should any other person have heretofore executed or
hereafter execute, in favor of Lender, any deed of trust, mortgage or security agreement, or have
heretofore pledged or hereafter pledge any other property to secure the payment of the secured
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.----..-.--..---.- ..--.- - --..-.-----~:-------.---- •.. ,..--.•--.--•..------, --.---..---.-.-,--.--.-- ..---.--.-.- --.-..,-r--- -----.,--~.--._ ..--..--------- ..-.- ---.----.----.-.- - -- -.------.--.- --..-..
4

indebtedness, or any part thereof, the exercise by Lender of any right or power conferred upon it
in any such instrument, or by any such pledge, shall be wholly discretionary with it, and the
exercise or failure to exercise any such right or power shall not impair or diminish Lender' s
rights, titles, interest, liens and powers existing hereunder.
ARTICLE VI
DEFAULT
Section 6.1 Event of Default. For purposes of this Agreement a default in the
performance of any of the terms or obligations of this Agreement or any of the other Loan
Documents by Pledgor or any other obligated party other than Lender shall constitute an event of
default (" Event of Default") hereunder.
Section 6.2 Remedies. Upon the occurrence of an Event of Default:
6.2.1 Lender shall have all of the rights and remedies at law or in equity,
including but not limited to the rights and remedies provided in the California Commercial Code.
In this connection, Lender may, on ten (10) days' written notice to Pledgor, and without liability
for any diminution in price that may have occurred, sell the Collateral in the manner and for the
price that Lender may determine. At any bona fide public sale, Lender shall be free to purchase
all or any part of the Collateral. Out of the proceeds of any sale, Lender may retain an amount
equal to the amounts then due to Lender under the Loan Documents, plus the amount of the
expenses of the sale including fees and disbursements of counsel and shall pay any balance of the
proceeds of any sale to Pledgor. If the proceeds of the sale are insufficient to cover the amounts
then due under the Note, plus expenses of the sale, Pledgor shall remain liable to Lender for any
deficiency, in accordance with the provisions of California Commercial Code Section 9608;
6.2.2 Lender, without the consent of Pledgor, may at any time vote and give
consents, ratifications and waivers with respect to the Collateral and Pledgor hereby irrevocably
constitutes and appoints Lender its sole proxy and attorney-in-fact with full power of substitution
to vote and act with respect to the Collateral outstanding in the name of Pledgor or with respect to
which Pledgor is entitled to vote and act. The proxy and power of attorney herein granted are
coupled with an interest, are irrevocable and shall continue throughout the term of this Agreement;
6.2.3 Lender, without the consent of Pledgor, may with respect to the Collateral,
join in and become a party to any plan of recapitalization, reorganization or readjustment (whether
voluntary or involuntary) as shall seem desirable to Lender, to protect or further the interest of
Lender with respect to the Collateral and deposit any of the Collateral under any such plan; make
any exchange, substitution, cancellation or surrender of the Collateral required by any such plan or
take such action with respect to the Collateral that may be required by any such plan or for the
accomplishment thereof; and no such disposition, exchange, substitution, cancellation or surrender
shall be deemed to constitute a release of the Collateral from the lien of this Agreement; and
6.2.4 Lender, without the consent of Pledgor, may transfer into its name or into
the name or names of its nominee or nominees, all or any portion of the Collateral.
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- ----- --------1
..-.__ _- ..~_.~~ .._--,_._~_.- _-,,- .,. _.---.-.------.---, ..-..---'""'.-.---~.--.-----~-..,..--- ----.:_--.- -.-----.-~-_ ..- -.-,-- .•~ ---.------~-- '~~.._-_._._ ..- --_ _ _.__ ~_._.--_-•..r-.-~ ---~.--~-

Section 6.3 Cumulative. All remedies hereunder are cumulative and are not exclusive of
any other remedies provided by law.
ARTICLE VII
MISCELLANEOUS
Section 7.1 Adjustments. In the event that, during the term of this Agreement, any
dividend, reclassification, readjustment, or other change is declared or made in the structure of the
Trust, all new, substituted and additional certificates or securities issued by reason of any change
shall be immediately delivered by Pledgor to Lender and held by Lender in the same manner as the
shares originally pledged under this Agreement.
Section 7.2 Payment of Note. On complete payment of the principal of and interest on
the Note and any other amounts due under the Loan Documents, Lender shall transfer to Pledgor
all the Collateral and all rights received by Lender as a result of Lender' s record ownership of the
Collateral, and upon such transfer this Agreement shall terminate; provided, however, that Section
7.7 shall survive termination of this Agreement.
Section 7.3 Entire Agreement; Successors. This Agreement, and the terms, covenants
and conditions hereof, shall be binding upon and inure to the benefit of Pledgor, Lender and their
respective successors and assigns (and any reference in this Agreement to any of them shall
include their respective successors and assigns), except that Pledgor shall not be permitted to
assign this Agreement or any interest herein to any person without the prior written consent of
Lender, which consent Lender may withhold in its sole and absolute discretion. This Agreement
constitutes the entire agreement between the parties hereto with respect to the matters set forth
herein.
Section 7.4 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of California, without giving effect to conflict of laws. In the event of a
dispute with respect to the interpretation of this Agreement, the parties agree that, at Lender' s
option, the courts located in Los Angeles, California shall have exclusive jurisdiction and be the
exclusive venue for resolution of any dispute resolution or legal proceeding arising from this
Agreement. Nothing contained herein shall affect the rights of Lender to bring a suit, action or
proceeding in any other appropriate jurisdiction.
Section 7.5 Modification of Agreement. No modification, amendment or waiver of any
provision of this Agreement shall be effective unless the same shall be in writing and executed by
Lender, and then such waiver or consent shall be effective only in the specific instance and for the
sole purpose for which given.
Section 7.6 Headings; Gender. Section headings used herein are for convenience only
and are not to affect the construction of, or to be taken into consideration in interpreting, this
Agreement. In this Agreement, whenever the context so requires, the masculine gender includes
the feminine and/or neuter, and the singular number includes the plural.
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Section 7.7 Indemnity. Pledgor agrees to indemnify, defend and hold harmless Lender
(and any nominee, custodian, co-assignee or agent of Lender) and its respective officers, directors,
attorneys, employees and agents from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted against Lender or such other
person in any way relating to or arising out of this Agreement or any other instrument delivered
pursuant to this Agreement or any action taken or omitted by Lender or such other person under
this Agreement or such other instrument, other than those resulting from Lender' s gross
negligence or willful misconduct.
Section 7.8 No Waiver. No failure on the part of Lender to exercise, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or remedy by Lender preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
Section 7.9 Notices. All notices or other communications required or permitted by this
Agreement (for purposes of this Section referred to collectively as " Notices"), to be effective,
shall be in writing, properly addressed, and shall be given: (i) by personal delivery; (ii) by
certified mail postage prepaid; or (iii) by facsimile with confirmation of transmission received or
mailed, to the following address or facsimile number specified below.
-- To Lender:
-- To Pledgor:
Facsimile No.: (_) _
Notices delivered by personal delivery shall be deemed to have been given upon tender to a natural
person at the address shown. Notices delivered by certified mail shall be deemed to have been
given the third business day after deposit in the mail. Notices delivered by facsimile shall be
deemed to have been given upon printed confirmation by the transmitting facsimile machine of
receipt by the receiving facsimile machine. Each party may change its address for notices by
giving notice in accordance with this Section.
Section 7.10 Fees and Expenses. Pledgor shall pay all costs and expenses incurred by
Lender in connection with the preparation, negotiation and execution of this Agreement and the
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7

other Loan Documents executed pursuant hereto and any and all amendments, modifications and
supplements thereto, including, without limitation, the costs and fees of Lender's legal counsel
and any applicable title company fees, title insurance premiums, filing fees or escrow fees.
Section 7.11 Counterparts. This Agreement may be executed in counterparts, all of
which together shall constitute a single instrument, and each of which shall be deemed an original
of this Agreement for all purposes, notwithstanding that fewer than all signatures appear on any
one counterpart.
Section 7.12 Severability of Provisions. Any provision or term of this Agreement which
is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without invalidating the remaining provisions and
terms hereof or affecting the validity or enforceability of such provision or term in any other
jurisdiction.
Section 7.13 Ambiguities Not to be Construed Against Drafting Party. The doctrine that
any ambiguity contained in a contract shall be construed against the party whose counsel has
drafted the contract is expressly waived by each of the parties hereto with respect to this
Agreement.
Section 7.14 Execution of Agreement. This Agreement was executed voluntarily without
any duress or undue influence on the part of or on behalf of the parties hereto. The parties
acknowledge that they have read and understood this Agreement, its legal effect and its tax
ramifications. Each party acknowledges that such party has had a reasonable opportunity to obtain
independent legal counsel for'3.dvice and representation in connection with this Agreement. Each
party further acknowledges that such party is not relying on the legal counsel employed by any of
the other parties to this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
1:\16463\OO2\oocUMENTS\PLEDGE AGREEMENT
LENDER:
==121112 =L22=2=E:::~::?:m:[~ •• -
~=====
Title: --.t_.-f 2
_.._._._ .._._ _..__.,.,.._..~.._ _._.__ ..-_ __.._,_~. _~_...,....., __ _ .._'._~.h_"_~ .._._. ,_. ._._.__ .._., .._.__ .._.._.,.~ __.._. __ , _"'~~_. .._ __ , _~. __ .__._~H _._ _.._.•. _ _.__ __ . : . .. .__.__
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STATE OF CALIFORNIA
COUNTY OF tA7..s /1-1/ 5eles,
-~_ .. '----=-=.-
NOTARY ACKNOWLEDGEMENT
)
)
)
On /lJ 01/ ~"" !:J ' '" G- , 2006, before me, the undersigned, a Notary
Public in and for said State, personally appeared
~rseflall, 1mBwR-tome (or proved on the basis of sa IS ac ory evidence) to be the person whose name
is subscribed to the within instrument and acknowledged to me that he/~t~ executed the same in
his/I}M/t~r authorized capacity(~, and that by his/h~~signature on the instrument the person, or
the entity upon behalf of which the person acted, executed the instrument.
WITNESS MY HAND AND OFFICIAL SEAL.
J: \ 16463\OO2\oOCUMENTS\PLEOGE AGREEMENT
~-..--,..--._-~_. __ .-.--_._,-- .•~_._..-------_._--- •.._._ .._-~~~_.,~._-_., _._._-_. __..~--_.~--.._-_.__..__ ~- ~':-__._.~ _._ _.._'._ __.__. ~ ~__ ._.._._~_'_'~_"_~_~~M_~. __ .__.. ._ _.~ .._.n. __. ~ .__ .
9