RIDGE VIEW COMMONS - CONSTRUCTION LOAN

Holder shall have the right to declare the entire unpaid balance hereof to be due and payable in advance of the maturity date without notice or demand on the failure of the Maker to make any payment of interest and /or principal hereunder within ten (10) days after the same is due, or upon the occurrence of any event of default under the Deed of Trust, Security Agreement, the Assign- ment of Rents and Lessor's Interest in Leases, the Construction Loan Agreement of even date herewith between Maker and Holder and all other documents executed in connection with the Building Agreement (said instruments are referred to collectively as the "Loan Documents "). While any default exists in the payment of principal or interest hereunder when due, or under any other Loan Document, then Holder shall have the right to increase the interest rate to the default interest rate specified hereinabove. The foregoing rights and remedies of Holder upon default are cumulative and may be exercised concurrently or independently by Holder. The forbearance to exercise any of the foregoing rights and remedies shall not constitute a waiver of any such rights and remedies as to any subsequent or continuing default or breach, and such rights and remedies may be exercised one or more times by Holder. Notwithstanding anything contained herein or in any other Loan Document executed in connection with the loan evidenced hereby, the effective interest rate on this Note shall not exceed the maximum effective interest rate permit- ted by applicable law or governmental regulation, and Holder agrees not to collect knowingly any fees or interest which will render the interest rate hereunder to be usurious. Time is of the essence of this Note. Should an attorney be employed to procure payment hereof by suit or otherwise, the undersigned hereby agrees to pay all costs of collection, including attorney's fees. From time to time, without affecting the obligation of Maker or the successors or assigns of Maker to pay the outstanding principal balance of this Note and observe the covenants of Maker contained herein, without giving notice to or obtaining the consent of Maker, the successors or assigns of Maker, and without liability on the part of Holder, Holder may, at the option of Holder, extend the time for payment of said outstanding principal balance or any part thereof, reduce the payments thereon, release anyone liable on any of said outstanding principal balance, accept a renewal of this Note, join in any extension or subordination agreement, release any security given herefor, take or release other or additional security, and agree in writing with Maker to modify the rate of interest or period of amortization of this Note or change the amount of the monthly installments payable hereunder. This Note is executed and delivered in the State of California and shall be governed by the laws of the State of California. The undersigned and all endorsers hereof hereby severally waive diligence, presentment, protest and demand, notice of protest, dishonor and non - payment of this Note. The right to plead any and all statutes of limitations as a defense to this Note or to any demand secured by the Deed of Trust, or other security, securing this Note by Maker, endorsers or sureties is expressly waived by each and all said parties. In the event Maker shall, directly or indirectly, without the prior written approval of Holder, voluntarily or involuntarily sell, assign, 20:connote.ehi Page 2