Exhibit 10.4

 

AMENDED AND RESTATED

LOAN AGREEMENT

 

Dated as of April 1, 2008

 

by and among

 

FIRST STATES INVESTORS DB I, L.P., and

FIRST STATES INVESTORS DB I B, L.P.,
as Holding Company Borrowers,

FIRST STATES INVESTORS 4200, LLC,

FIRST STATES INVESTORS DB I SP, L.P., and

FIRST STATES INVESTORS DB I TRS, L.P.,

as Current Property-Owning Borrowers, and

any Future Property-Owning Borrower that joins the Loan Agreement from time to
time,
collectively as Borrower,

 

DEUTSCHE BANK AG, CAYMAN ISLANDS BRANCH
as Agent,

 

LASALLE BANK NATIONAL ASSOCIATION
as Collateral Agent

 

and

 

Each Lender Signatory hereto

 

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TABLE OF CONTENTS

 

 

 

Page

 

 

 

ARTICLE I.

CERTAIN DEFINITIONS

2

Section 1.1.

Definitions

2

 

 

 

ARTICLE II.

CONDITIONS PRECEDENT

30

Section 2.1.

Conditions Precedent to Closing

30

Section 2.2.

Execution and Delivery of Agreement

32

Section 2.3.

Advance Procedure.

32

Section 2.4.

Initial and Subsequent Advances

36

 

 

 

ARTICLE III.

GENERAL TERMS

38

Section 3.1.

The Loan

38

Section 3.2.

Use of Proceeds

39

Section 3.3.

Security for the Loan

39

Section 3.4.

Borrower’s Note

39

Section 3.5.

Repayment of Advances; Interest

39

Section 3.6.

Voluntary Prepayment

40

Section 3.7.

Mandatory Prepayment; Capital Events; Certain Transfers

40

Section 3.8.

Application of Payments After Event of Default

41

Section 3.9.

Method and Place of Payment From the Collection Account to Agent

42

Section 3.10.

Taxes

42

Section 3.11.

Release of Collateral

42

Section 3.12.

Central Cash Management

43

Section 3.13.

Reserve Account

47

Section 3.14.

Additional Provisions Relating to the Collection Account and the Reserve Account

51

Section 3.15.

Security Agreement

52

Section 3.16.

Real Estate Security Documents; Mortgage Recording Taxes

54

Section 3.17.

Taxes

55

Section 3.18.

General Collateral Agent Provisions

56

Section 3.19.

Indemnity

59

Section 3.20.

Inability to Determine Interest Rate; Illegality

59

Section 3.21.

Requirements of Law

60

Section 3.22.

Extension Option

61

 

 

 

ARTICLE IV.

REPRESENTATIONS AND WARRANTIES

61

Section 4.1.

Representations and Warranties as to Borrower

61

Section 4.2.

Representations and Warranties as to Each Property

67

Section 4.3.

Survival of Representations

74

 

 

 

ARTICLE V.

AFFIRMATIVE COVENANTS

74

Section 5.1.

Affirmative Covenants

74

 

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ARTICLE VI.

NEGATIVE COVENANTS

100

Section 6.1.

Negative Covenants

100

 

 

 

ARTICLE VII.

EVENT OF DEFAULT

103

Section 7.1.

Event of Default

103

Section 7.2.

Remedies

105

Section 7.3.

Remedies Cumulative

106

Section 7.4.

Curative Advances

106

 

 

 

ARTICLE VIII.

MISCELLANEOUS

106

Section 8.1.

Survival

106

Section 8.2.

Agent’s Discretion

107

Section 8.3.

Governing Law

107

Section 8.4.

Modification, Waiver in Writing

107

Section 8.5.

Delay Not a Waiver

108

Section 8.6.

Notices

108

Section 8.7.

TRIAL BY JURY

108

Section 8.8.

Headings

108

Section 8.9.

Assignment.

109

Section 8.10.

Severability

109

Section 8.11.

Preferences

109

Section 8.12.

Waiver of Notice

110

Section 8.13.

Failure to Consent

110

Section 8.14.

Schedules Incorporated

110

Section 8.15.

Offsets, Counterclaims and Defenses

110

Section 8.16.

No Joint Venture or Partnership

110

Section 8.17.

Waiver of Marshalling of Assets Defense

111

Section 8.18.

Waiver of Counterclaim

111

Section 8.19.

Conflict; Construction of Documents

111

Section 8.20.

Brokers and Financial Advisors

111

Section 8.21.

Counterparts

111

Section 8.22.

Estoppel Certificates

111

Section 8.23.

Payment of Expenses

112

Section 8.24.

Non-Recourse

112

 

 

 

ARTICLE IX.

THE AGENT

113

Section 9.1.

Appointment, Powers and Immunities

113

Section 9.2.

Reliance by Agent

113

Section 9.3.

Defaults

114

Section 9.4.

Rights as a Lender

114

Section 9.5.

Indemnification

114

Section 9.6.

Non-Reliance on Agent and Other Lenders

114

Section 9.7.

Failure to Act

115

Section 9.8.

Resignation of Agent

115

Section 9.9.

Agency Fee

115

Section 9.10.

Consents under Loan Documents

115

Section 9.11.

Notices, Reports and Other Communications

116

 

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SCHEDULES

 

Schedule I             –              List of Current Property-Owning Borrowers

 

Schedule II            –              List of Property as of the Closing Date

 

Schedule III           –              List of Loan Documents as of the Closing
Date

 

Schedule IV           –              List of Regions Properties

 

Schedule V            –              List of Borrowers’ Organizational
Identification

 

Schedule VI           –              Exceptions to Representations and
Warranties

 

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AMENDED AND RESTATED LOAN AGREEMENT

 

THIS AMENDED AND RESTATED LOAN AGREEMENT, made as of April 1, 2008, is by and
among: (i) FIRST STATES INVESTORS DB I, L.P., a Delaware limited partnership and
FIRST STATES INVESTORS DB I B, L.P., a Delaware limited partnership, as the
parent entities of each applicable Current Property-Owning Borrower and each
applicable Future Property-Owning Borrower (each as hereinafter defined)
(individually or collectively, as applicable, the “Holding Company Borrower”),
FIRST STATES INVESTORS 4200, LLC, a Delaware limited liability company, FIRST
STATES INVESTORS DB I SP, L.P., a Delaware limited partnership, and FIRST STATES
INVESTORS DB I TRS, L.P., a Delaware limited partnership (individually or
collectively, as applicable, a “Current Property-Owning Borrower”), and each
wholly-owned subsidiary entity of the applicable Holding Company Borrower that
owns a Property and from time to time joins this Agreement as an additional
Borrower after the date hereof (individually or collectively, as applicable, a
“Future Property-Owning Borrower”), each having an address at c/o American
Financial Realty Trust, c/o Gramercy Capital Corp., 420 Lexington Avenue, New
York,  New York  10170 (the Holding Company Borrower, each Current
Property-Owning Borrower and each Future Property-Owning Borrower collectively,
the “Borrower”); each of the financial institutions signatory hereto that is
identified as a “Lender” on the signature pages hereto or that, pursuant to
Section 8.9 hereof, shall become a “Lender” hereunder (individually, a “Lender”,
and collectively, the “Lenders”); (ii) DEUTSCHE BANK AG, CAYMAN ISLANDS BRANCH,
a branch of a foreign banking institution, having an address at 60 Wall Street,
10th Floor, New York, New York as agent for the Lenders (in such capacity
together with its successors in such capacity, the “Agent”); and (iii) LASALLE
BANK NATIONAL ASSOCIATION, a national banking association, having an address at
135 South LaSalle Street, Suite 1625, Chicago, Illinois 60603, as a “bank” (as
defined in Section 9-102(a)(8) of the UCC), as a “securities intermediary” (as
defined in Section 8-102(a)(14) of the UCC) and as collateral agent for the
Lenders (as used herein, “Collateral Agent” shall refer to LaSalle Bank National
Association in each such capacity as the context requires together with any
successor thereto).

 

RECITALS

 

WHEREAS, pursuant to that certain Loan Agreement dated as of July 18, 2003 (the
“Original Closing Date”), as amended by that certain First Amendment to Loan
Agreement, dated August 9, 2004, that certain Second Amendment to Loan
Agreement, dated September 30, 2004, and that certain Third Amendment to Loan
Agreement, dated September 30, 2005 (together, the “Original Loan Agreement”),
by and among First States Investors DB I, LLC (the “Original Holding Company
Borrower”), various wholly-owned subsidiary entities of the Original Holding
Company Borrower that owned Property and joined the Original Loan Agreement (the
“Original Property-Owning Borrowers”), the Agent on behalf of the Lenders and
the Collateral Agent, the Original Holding Company Borrower and various of the
Original Property-Owning Borrowers obtained a series of loan advances from Agent
(the “Original Loan”) to provide financing for portions of the acquisition cost
of CTL Property and Conduit CMBS Property that the Original Holding Company
Borrower and various of the Original Property-Owning Borrowers acquired and to
pay certain other fees and expenses;

 

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WHEREAS, Gramercy Capital Corp., a Maryland corporation, has entered into a
definitive merger agreement to acquire American Financial Realty Trust, which
would result in the loan under the Original Loan Agreement being due and
payable;

 

WHEREAS, Gramercy Capital Corp., a Maryland corporation, has requested that the
Agent amend and restate the Original Loan Agreement and those certain other loan
documents that evidenced the Original Loan as set forth herein and in the Loan
Documents;

 

WHEREAS, the Agent is unwilling to amend and restate the Original Loan Agreement
unless the Borrower joins in the execution and delivery of this Agreement, the
Note and the other Loan Documents (each as hereinafter defined) which shall
establish the terms and conditions of the Loan as amended and restated;

 

WHEREAS, Borrower desires to obtain a series of loan advances (as have been
advanced prior to the date hereof pursuant to the Original Loan Agreement and as
may be advanced in the future in accordance herewith, each, an “Advance” and
collectively, the “Loan”) to provide financing for portions of the acquisition
cost of CTL Property and Conduit CMBS Property that the Holding Company
Borrowers, Current Property-Owning Borrowers and Future Property-Owning
Borrowers acquire and to pay certain other fees and expenses;

 

WHEREAS, the aggregate amount of Advances from Agent at any time shall not
exceed $100,000,000 (the “Loan Amount”);

 

WHEREAS, as of the date hereof the outstanding Principal Indebtedness equals
$95,000,000 (the “Closing Date Loan Amount”) and the Property that indirectly
secures the Loan is set forth on Schedule II attached hereto;

 

WHEREAS, Borrower has agreed to establish certain accounts and to grant to the
Agent on behalf of, and for the benefit of, the Lenders, a security interest
therein upon the terms and conditions of the security agreement set forth in
Section 3.15; and

 

WHEREAS, LaSalle Bank National Association, in its capacity as collateral agent,
bank and securities intermediary is willing to join in this Agreement in such
capacities.

 

NOW, THEREFORE, in consideration of the making of the Loan by the Lenders and
for other good and valuable consideration, the mutual receipt and legal
sufficiency of which are hereby acknowledged, the parties hereby covenant,
agree, represent and warrant as follows:

 

ARTICLE I.
CERTAIN DEFINITIONS

 

SECTION 1.1.            DEFINITIONS.  FOR ALL PURPOSES OF THIS AGREEMENT: 
(1) THE CAPITALIZED TERMS DEFINED IN THIS ARTICLE I HAVE THE MEANINGS ASSIGNED
TO THEM IN THIS ARTICLE I AND INCLUDE THE PLURAL AS WELL AS THE SINGULAR;
(2) ALL ACCOUNTING TERMS HAVE THE MEANINGS ASSIGNED TO THEM IN ACCORDANCE WITH
GAAP (AS HEREINAFTER DEFINED); (3) THE WORDS “HEREIN”, “HEREOF’, AND “HEREUNDER”
AND OTHER WORDS OF SIMILAR IMPORT REFER TO THIS AGREEMENT AS A WHOLE

 

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AND NOT TO ANY PARTICULAR ARTICLE, SECTION, OR OTHER SUBDIVISION; AND (4) THE
FOLLOWING TERMS HAVE THE FOLLOWING MEANINGS:

 

“4200 Holdings” means First States Investors 4200 Holdings, LLC, a Delaware
limited liability company.

 

“Accepted Practices” means such customary practices as commercial mortgage
collateral agents or banks would follow in the normal course of their business
in performing administrative and custodial duties with respect to collateral
which is generally similar to the Account Collateral; provided, however, that
“Accepted Practices” shall not be deemed to include any custodial practices now
followed by Collateral Agent for any such collateral held for its own account to
the extent that such practices are more stringent than the practices followed by
commercial mortgage collateral agents or banks generally.

 

“Account Collateral” has the meaning set forth in Section 3.15(a) hereof.

 

“Accounts” means all of Property-Owning Borrower’s right, title and interest,
whether now owned or hereafter acquired, in, to and under all “accounts” as
defined in the UCC.

 

“Acquisition Cost” means, with respect to each acquisition of Property, the
related purchase price plus related reasonable out-of-pocket costs and expenses
approved by the Agent.

 

“Advance” has the meaning set forth in the Recitals hereto.

 

“Advance Closing Date” means each date on which an Advance is made hereunder to
provide Property-Owning Borrower with funds to acquire Property pursuant to
Sections 2.3 and 2.4.

 

“Advance Percentage” means 80%.

 

“Advance Rate” means, with respect to each Advance for Property, the product of
the Advance Percentage and the lesser of (x) the related Capital Markets
Execution and (y) the related Acquisition Cost.

 

“Advisory Fee” has the meaning ascribed to such term in the Advisory Fee Letter.

 

“Advisory Fee Letter” means that certain letter agreement by and between
Gramercy Capital Corp., and Deutsche Bank Securities Inc., dated as of April 1,
2008.

 

“Affiliate” of any specified Person means any other Person controlling or
controlled by or under common control with such specified Person. For the
purposes of this definition, “control” when used with respect to any specified
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities or
other beneficial interests, by contract or otherwise; and the terms
“controlling” and “controlled” have the meanings correlative to the foregoing.

 

“Agent” has the meaning provided in the first paragraph of this Agreement.

 

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“Agreement” means this Loan Agreement, together with the Schedules and Exhibits
hereto, as the same may from time to time hereafter be modified, supplemented or
amended.

 

“Alternative Rate” shall have the meaning assigned to such term in
Section 3.20(a).

 

“Alternative Rate Transaction” shall mean, with respect to any Interest Accrual
Period, any Advance with respect to which the interest rate for such Interest
Period is determined with reference to the Alternative Rate.

 

“Applicable Margin” means three hundred basis points (3.00%).

 

 “Appraisal” means an appraisal with respect to the Property prepared by an
Appraiser in accordance with the Uniform Standards of Professional Appraisal
Practice of the Appraisal Foundation, in compliance with the requirements of
Title 11 of the Financial Institution Reform, Recovery and Enforcement Act and
utilizing customary valuation methods such as the income, sales/market or cost
approaches.

 

“Appraiser” means a nationally recognized MAI appraiser selected by Borrower and
reasonably approved by the Agent.

 

“Assignment of Leases and Rents” means, with respect to each Property, an
Assignment of Rents and Leases, dated as of the applicable Advance Closing Date,
granted by the applicable Property-Owning Borrower to Agent for the benefit of
the Lenders with respect to the related Leases, as same may thereafter from time
to time be supplemented, amended, modified or extended by one or more agreements
supplemental thereto.

 

“Basic Carrying Costs” means the following costs with respect to the Property: 
(i) Impositions and (ii) insurance premiums for policies of insurance required
to be maintained by Property-Owning Borrower pursuant to this Agreement or the
other Loan Documents.

 

“Borrower” has the meaning provided in the first paragraph of this Agreement.
All references in this Agreement to Borrower shall be deemed to include and be
equally applicable to the Holding Company Borrowers and any Property-Owning
Borrower.

 

“Business Day” means any day other than a Saturday, a Sunday or a day on which
commercial banks in the State of New York or Illinois are authorized or
obligated by law, governmental decree or executive order to be closed. When used
with respect to an Interest Determination Date, “Business Day” shall mean any
day other than a Saturday, a Sunday or a day on which banks in London, England
are closed for interbank or foreign exchange transactions.

 

“Capital Event” means any transfer, sale, assignment, conveyance, liquidation,
or disposition (other than a Taking) of a Property and “Capital Events” shall
have a meaning correlative to the foregoing.

 

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“Capital Event Proceeds” means any cash proceeds of a Capital Event received by
the Borrower net of any cash prorations, adjustments and credits with respect to
such Capital Event and net of reasonable third-party expenses paid in connection
with such Capital Event.

 

“Capital Improvement Costs” means costs incurred or to be incurred in connection
with replacements and capital repairs made to the Property (including without
limitation, TI Costs and Leasing Commissions).

 

“Capital Markets Execution” means, with respect to each Property and the related
Advance, the maximum amount of debt financing that can be issued with respect to
such Property as determined by the Agent in its good faith business judgment;
provided, that, notwithstanding the foregoing, such amount of debt financing
shall be subject to a cap equal to seventy percent (70%) of the value of the
related Property as determined by the Agent in its good faith business judgment.

 

“Chattel Paper” means all of Property-Owning Borrower’s right, title and
interest, whether now owned or hereafter acquired, in, to and under all “chattel
paper” as defined in the UCC (whether tangible chattel paper or electronic
chattel paper).

 

“Closing Date” means the date of the execution of this Agreement.

 

“Closing Date Loan Amount” has the meaning set forth in the Recitals hereto.

 

“Code” means the Internal Revenue Code of 1986, as amended, and as it may be
further amended from time to time, any successor statutes thereto, and
applicable U.S. Department of Treasury regulations issued pursuant thereto in
temporary or final form.

 

“Collateral” means, (x) so long as an Event of Default under the Loan has not
occurred and is not continuing, the entire legal and beneficial ownership
interests in each Property-Owning Borrower pledged pursuant to the applicable
Pledge Agreement (Property-Owning Borrower) and (y) after the occurrence and
during the continuance of an Event of Default, collectively, the Land,
Improvements, Leases, Rents, Personalty, and all Proceeds, and (to the full
extent assignable) Permits, which is or hereafter may become subject to a Lien
in favor of the Agent on behalf of the Lenders as security for the Loan (whether
pursuant to the Mortgages, any other Loan Document or otherwise), all whether
now owned or hereafter acquired and all other property which is or hereafter may
become subject to a Lien in favor of the Agent on behalf of the Lenders as
security for the Loan and including all property of any kind described as part
of the Property under the Mortgages.

 

“Collateral Agent” has the meaning specified in the introductory paragraph of
this Agreement.

 

“Collateral Assignment of the Master License Agreement” has the meaning provided
in Section 2.1(o).

 

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“Collateral Information” means with respect to any asset acquisition proposed to
be financed with the proceeds of an Advance, all information relating to such
asset as may be reasonably requested by Agent.

 

“Collateral Security Instrument” means any right, document or instrument, other
than the Mortgages, given as security for the Loan, including, without
limitation, the Pledge Agreements.

 

“Collection Account” has the meaning set forth in Section 3.12(a) hereof.

 

“Collection Period” means, with respect to any Payment Date, the period
commencing on and including the eleventh (11th) day in the month preceding the
month in which such Payment Date occurs through and including the tenth (l0th)
day in the immediately succeeding month in which such Payment Date occurs;
provided, however, that in the case of the first Payment Date, the “Collection
Period” shall commence on the initial Advance Closing Date.

 

 “Condemnation Proceeds” means, in the event of a Taking with respect to the
Property, the proceeds in respect of such Taking less any reasonable third party
out-of-pocket expenses incurred in collecting such proceeds.

 

“Conduit CMBS Property” means a multi-tenant property or a commercial property
(including a retail, office, warehouse property, but excluding raw land)
suitable for inclusion in a conduit commercial mortgage-backed securities
offering.

 

“Consumer Price Index” means the Consumer Price Index for All Urban Consumers
published by the Bureau of Labor Statistics of the United States Department of
Labor, in the area where the Property is located; All Items (1982-84 = 100), or
any successor index thereto, appropriately adjusted and if the Consumer Price
Index ceases to be published and there is no successor thereto, such other index
as Agent and Borrower shall mutually agree upon.

 

“Contingent Obligation” means, as used in the definition of Other Borrowings,
without duplication, any obligation of Borrower guaranteeing any indebtedness,
leases, dividends or other obligations (“primary obligations”) of any other
Person (the “primary obligor”) in any manner, whether directly or indirectly.
Without limiting the generality of the foregoing, the term “Contingent
Obligation” shall include any obligation of Borrower:

 

(i)            to purchase any such primary obligation or any property
constituting direct or indirect security therefor;

 

(ii)           to advance or supply funds (x) for the purchase or payment of any
such primary obligation or (y) to maintain working capital or equity capital of
the primary obligor;

 

(iii)          to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation; or

 

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(iv)          otherwise to assure or hold harmless the holder of such primary
obligation against loss in respect thereof.

 

The amount of any Contingent Obligation shall be deemed to be an amount equal to
the stated or determinable amount of the primary obligation in respect of which
such Contingent Obligation is made or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof (assuming Borrower
is required to perform thereunder) as determined by Agent in good faith.

 

“Contract Assignment” means, with respect to each Property, the Assignment of
Contracts, Licenses, Permits, Agreements, Warranties and Approvals, dated as of
the applicable Advance Closing Date and granted by the applicable
Property-Owning Borrower to Agent for the benefit of the Lenders with respect to
the related Contracts, as same may thereafter from time to time be supplemented,
amended, modified or extended by one or more agreements supplemental thereto.

 

“Contracts” means the Management Agreement and all other agreements to which the
applicable Property-Owning Borrower is a party or which are assigned to the
applicable Property-Owning Borrower by the applicable Manager in the applicable
Management Agreement and which are executed in connection with the construction,
operation and management of the Property (including, without limitation,
agreements for the sale, lease or exchange of goods or other property and/or the
performance of services by it, in each case whether now in existence or
hereafter arising or acquired) as any such agreements have been or may be from
time to time amended, supplemented or otherwise modified.

 

“Credit Lease” means a Triple Net Lease, a Double Net Lease or a bond-type lease
to a tenant acceptable to the Agent that occupies and/or is master lessor to
subtenants that occupy the related Property.

 

“CTL Property” means a commercial property that is subject to a Credit Lease.

 

“Current Property-Owning Borrower” has the meaning set forth in the Recitals
hereto.

 

“Deed of Trust Trustee” means the trustee under the Mortgage that constitutes a
“deed of trust” under applicable law.

 

“Default” means the occurrence of any event which, but for the giving of notice
or the passage of time, or both, would be an Event of Default.

 

“Default Rate” means the per annum interest rate equal to the lesser of (a) 4.0%
per annum in excess of the rate otherwise applicable hereunder and (b) the
maximum rate allowable by applicable law.

 

“Deferred Maintenance Escrow Account” has the meaning set forth in
Section 3.13(a).

 

“Deficient Amount” has the meaning set forth in Section 5.1(x)(iv)(B).

 

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“Deposit Account” means all of Property-Owning Borrower’s right, title and
interest, whether now owned or hereafter acquired, in, to and under all “deposit
accounts” as defined in the UCC.

 

“Diligence Materials” means, collectively, the Preliminary Due Diligence Package
and the Supplemental Due Diligence List.

 

“Documents” means all of Property-Owning Borrower’s right, title and interest,
whether now owned or hereafter acquired, in, to and under all “documents” as
defined in the UCC (whether negotiable or non-negotiable) or other receipts
covering, evidencing or representing goods.

 

“Double Net Lease” shall mean a lease under which the tenant pays for all or
substantially all of any two of the following for the Property:  (i) real estate
property taxes; (ii) property insurance; and (iii) operating expenses.

 

“Eligible Account” means a separate and identifiable account from all other
funds held by the holding institution that is:  (i) an account maintained with a
federal or state chartered depository institution or trust company whose
(1) commercial paper, short-term debt obligations or other short-term deposits
are rated by the Rating Agencies not less than “A-l”(or the equivalent), if the
deposits are to be held in the account for thirty (30) days or less or
(2) long-term unsecured debt obligations are rated at least “AA” (or the
equivalent), if the deposits are to be held in the account more than thirty (30)
days or (ii) a segregated trust account maintained with the corporate trust
department of a federal or state chartered depository institution or trust
company subject to regulations regarding fiduciary funds on deposit similar to
Title 12 of the Code of Federal Regulations Section 9.10(b) which, in either
case, has corporate trust powers, acting in its fiduciary capacity. An Eligible
Account shall not be evidenced by a certificate of deposit, passbook, other
instrument or any other physical indicia of ownership. Following a downgrade,
withdrawal, qualification or suspension of such institution’s rating, each
account must promptly (and in any case within not more than thirty (30) calendar
days) be moved to a qualifying institution or to one or more segregated trust
accounts in the trust department of such institution, if permitted.

 

“Embargoed Person” has the meaning set forth in Section 4.1(w).

 

“Engineer” means an Independent Engineer selected by Borrower and reasonably
approved by Agent.

 

“Engineering Report” means the structural engineering reports with respect to
the Property prepared by an Engineer and delivered to Agent in connection with
each Advance and any amendments or supplements thereto delivered to Agent.

 

“Environmental Auditor” means an Independent environmental auditor selected by
Borrower and reasonably approved by Agent.

 

“Environmental Claim” means any notice, notification, request for information,
claim, administrative, regulatory or judicial action, suit, judgment, demand or
other written

 

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communication (whether written or oral) by any Person or Governmental Authority
alleging or asserting liability with respect to Borrower or the Property
(whether for damages, contribution, indemnification, cost recovery,
compensation, injunctive relief, investigatory, response, remedial or cleanup
costs, damages to natural resources, personal injuries, fines or penalties)
arising out of, based on or resulting from (i) the presence, Use or Release into
the environment of any Hazardous Substance at any location (whether or not
owned, managed or operated by Borrower) that affects the Property, (ii) any
fact, circumstance, condition or occurrence forming the basis of any violation,
or alleged violation, of any Environmental Law with respect to the Property or
(iii) any alleged injury or threat of injury to human health, safety or the
environment with respect to the Property.

 

“Environmental Indemnity Agreement” means that certain Amended and Restated
Environmental Indemnity Agreement, dated as of the date hereof, from the
Borrower and Gramercy Capital Corp., as indemnitors, to the Lenders, Agent and
Collateral Agent, as indemnitees.

 

“Environmental Laws” means any and all present and future federal, state or
local laws, statutes, ordinances, rules or regulations, or any judicial
interpretation thereof, any judicial or administrative orders, decrees or
judgments thereunder issued by a Governmental Authority, and any permits,
approvals, licenses, registrations, filings and authorizations, in each case as
now or hereafter in effect, relating to the environment, human health or safety,
or the Release or threatened Release of Hazardous Substances or otherwise
relating to the Use of Hazardous Substances.

 

“Environmental Reports” means a “Phase I Environmental Site Assessment” (and, if
such Phase I Environmental Site Assessment identifies any recognized
environmental conditions requiring further investigation, a “Phase II
Environment Site Assessment” with respect to such recognized environmental
conditions) as referred to in the ASTM Standards on Environmental Site
Assessments for Commercial Real Estate, E 1527-00 and an asbestos survey (if
available), with respect to the Property, prepared by an Environmental Auditor
and delivered to Agent in connection with each Advance and any amendments or
supplements thereto delivered to Agent.

 

“EO13224” has the meaning set forth in Section 4.1(v).

 

“Equipment” means all of Property-Owning Borrower’s right, title and interest,
whether now owned or hereafter acquired, in, to and under (i) all “equipment” as
defined in the UCC, and (ii) all of the following (regardless of how classified
under the UCC):  all building materials, construction materials, personal
property constituting furniture, fittings, appliances, apparatus, leasehold
improvements, machinery, devices, interior improvements, appurtenances,
equipment, plant, furnishings, fixtures, computers, electronic data processing
equipment, telecommunications equipment and other fixed assets now owned or
hereafter acquired by Property-Owning Borrower, and all Proceeds of (i) and
(ii) and as well as all additions to, substitutions for, replacements of or
accessions to any of the items recited as aforesaid and all attachments,
components, parts (including spare parts) and accessories, whether installed
thereon or affixed thereto, all regardless of whether the same are located on
such Property or are located elsewhere (including, without limitation, in
warehouses or other storage facilities or in the

 

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possession of or on the premises of a bailee, vendor or manufacturer) for
purposes of manufacture, storage, fabrication or transportation and all
extensions and replacements to, and proceeds of, any of the foregoing.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations promulgated thereunder.
Section references to ERISA are to ERISA, as in effect at the date of this
Agreement and, as of the relevant date, any subsequent provisions of ERISA,
amendatory thereof, supplemental thereto or substituted therefor.

 

“ERISA Affiliate” means any corporation or trade or business that is a member of
any group of organizations (i) described in Section 414(b) or (c) of the Code of
which Borrower is a member and (ii) solely for purposes of potential liability
under Section 302(c)(11) of ERISA and Section 412(c)(11) of the Code and the
lien created under Section 302(f) of ERISA and Section 412(n) of the Code,
described in Section 414(m) or (o) of the Code of which Borrower is a member.

 

“Escrow Agreement” means, with respect to the Real Estate Security Documents,
the Escrow Agreement, to be entered into by and among the Holding Company
Borrowers on behalf of itself and each Property-Owning Borrower, the Agent, the
Collateral Agent, and the Title Agent, as same may thereafter from time to time
be supplemented, amended, modified or extended by one or more agreements
supplemental thereto.

 

“Event of Default” has the meaning set forth in Section 7.1 hereof.

 

“Extended Maturity Date” has the meaning set forth in Section 3.22(a).

 

“Extension Conditions” has the meaning set forth in Section 3.22(a).

 

“Extension Fee” has the meaning set forth in Section 3.22(a)(iv).

 

“Extension Notice” has the meaning set forth in Section 3.22(a)(i).

 

“Extension Option” has the meaning set forth in Section 3.22(a).

 

“Fee Letter” means the letter dated the date hereof entered into between
Borrower and the Collateral Agent, with respect to the fees of the Collateral
Agent under this Agreement.

 

“Fiscal Year” means the 12-month period ending on December 31st of each year
(or, in the case of the first fiscal year, such shorter period from the Closing
Date through such date) or such other fiscal year of Borrower as Borrower may
select from time to time with the prior consent of Agent.

 

 “Fund” has the meaning set forth in the definition of “Permitted Investments”.

 

 “Future Property-Owning Borrower” has the meaning set forth in the Recitals
hereto.

 

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“GAAP” means generally accepted accounting principles in the United States of
America as of the date of the applicable financial report.

 

“General Intangibles” means all of Property-Owning Borrower’s right, title and
interest, whether now owned or hereafter acquired, in, to and under (i) all
“general intangibles” as defined in the relevant UCC, now owned or hereafter
acquired by Property-Owning Borrower and (ii) all of the following (regardless
of how characterized):  all agreements, covenants, restrictions or encumbrances
affecting the Property or any part thereof.

 

“General Partner” means, individually or collectively, as applicable, (i) First
States Investors DB I GP, LLC, a Delaware limited liability company, as general
partner of First States Investors DB I, L.P., and (ii) First States Investors DB
I B GP, LLC, a Delaware limited liability company, as general partner of First
States Investors DB I B, L.P.

 

“Governmental Authority” means any national or federal government, any state,
regional, local or other political subdivision thereof with jurisdiction and any
Person with jurisdiction exercising executive, legislative, judicial, regulatory
or administrative functions of or pertaining to government.

 

“Gross Revenue” means, for any period, the total dollar amount of all income and
receipts received by, or for the account of, Property-Owning Borrower in the
ordinary course of business with respect to the Property, but excluding Loss
Proceeds (other than the proceeds of business interruption insurance or the
proceeds of a temporary Taking in lieu of Rents).

 

“Ground Lease” means any Property owned by a Property-Owning Borrower which is a
leasehold estate.

 

“Ground Lease Impairment” means with respect to the Ground Lease:  (i) any
termination, cancellation or surrender (in each case in whole or in part and
whether or not pursuant to an express right contained in the Ground Lease);
(ii) any modification, amendment, supplementation, or other change affecting the
Ground Lease; (iii) any subordination, or consent to the subordination of the
Ground Lease to any mortgage or other Lien encumbering (or that may in the
future encumber) the estate of the lessor under the Ground Lease in any
premise(s) demised to Borrower under the Ground Lease; or (iv) Borrower’s
delivery of any notice to the lessor under the Ground Lease that impairs or may
impair, or purports to limit the exercise of Agent’s rights and remedies under
the Mortgage or the Ground Lease, whether caused by Borrower or suffered or
permitted to occur by Borrower.

 

“Ground Rent” means any and all payments required of Borrower under the Ground
Lease, including base rent, fixed rent, additional rent, and any other payments,
sums or charges payable or required to be paid, whether to the ground lessor or
to a third party, under the Ground Lease.

 

“Guarantor” means Gramercy Capital Corp., a Maryland corporation.

 

“Guaranty” means, with respect to the Loan, that certain Guaranty from the
Guarantor to the Agent for the benefit of the Lenders.

 

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“Hazardous Substance” means, collectively, (i) any petroleum or petroleum
products or waste oils, explosives, radioactive materials, asbestos, urea
formaldehyde foam insulation, polychlorinated biphenyls (“PCBs”), lead-based
paint and radon, (ii) any chemicals or other materials or substances which are
now or hereafter become defined as or included in the definitions of “hazardous
substances”, “hazardous wastes”, “hazardous materials”, “extremely hazardous
wastes”, “restricted hazardous wastes”, “toxic substances”, “toxic pollutants”,
“contaminants”, “pollutants” or words of similar import under any Environmental
Law and (iii) any other chemical or any other hazardous material or substance,
exposure to which is now or hereafter prohibited, limited or regulated under any
Environmental Law.

 

“Holding Company Borrower” has the meaning provided in the first paragraph of
this Agreement.

 

“Impositions” means all taxes (including, without limitation, all real estate,
ad valorem, sales (including those imposed on lease rentals), use, single
business, gross receipts, value added, intangible transaction privilege,
privilege or license or similar taxes), assessments (including, without
limitation, all assessments for public improvements or benefits, whether or not
commenced or completed within the term of the Loan), ground rents, water, sewer
or other rents and charges, excises, levies, governmental fees (including,
without limitation, license, permit, inspection, authorization and similar
fees), and all other governmental charges, in each case whether general or
special, ordinary or extraordinary, foreseen or unforeseen, in respect of the
Property (including all interest and penalties thereon), accruing during or in
respect of the term hereof and which may be assessed against or imposed on or in
respect of or be a Lien upon (1) Borrower (including, without limitation, all
income, franchise, single business or other taxes imposed on Borrower for the
privilege of doing business in the jurisdiction in which the Property, or any
other collateral delivered or pledged to Agent in connection with the Loan, is
located), or (2) the Property, or any other collateral delivered or pledged to
Lenders in connection with the Loan, or any part thereof or any Rents therefrom
or any estate, right, title or interest therein, or (3) any occupancy,
operation, use or possession of, or sales from, or activity conducted on, or in
connection with the Property or the leasing or use of the Property or any part
thereof, or the acquisition or financing of the acquisition of the Property by
Borrower.

 

“Improvements” means all buildings, structures, fixtures and improvements now or
hereafter owned by Property-Owning Borrower of every nature whatsoever situated
on any Land constituting part of the Property (including, without limitation,
all gas and electric fixtures, radiators, heaters, engines and machinery,
boilers, ranges, elevators and motors, plumbing and heating fixtures, carpeting
and other floor coverings, water heaters, awnings and storm sashes, and cleaning
apparatus which are or shall be affixed to the Land or said buildings,
structures or improvements and including any additions, enlargements,
extensions, modifications, repairs or replacements thereto).

 

“Indebtedness” means the Principal Indebtedness, together with all other
obligations and liabilities due or to become due to the Lenders pursuant hereto,
under the Note or in accordance with any of the other Loan Documents, and all
other amounts, sums and expenses paid by or payable to the Lenders hereunder or
pursuant to the Note or any of the other Loan Documents.

 

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“Indemnification Agreement” means with respect to any Property, the related
indemnification agreement, if any, delivered by Gramercy Capital Corp., a
Maryland corporation, to the Agent for the benefit of the Lenders pursuant to
which Gramercy Capital Corp., a Maryland corporation, agrees to indemnify the
Agent and Lenders for any losses incurred on the related Advance due to or as a
result of conditions existing at (or circumstances surrounding) such Property
relating to matters that would be reasonably expected to be revealed by due
diligence deliveries referenced in Article II of this Agreement that were not
made in connection with such Advance.

 

“Indemnified Parties” has the meaning set forth in Section 5.1(i).

 

“Independent” means, when used with respect to any Person, a Person that
(i) does not have any direct financial interest or any material indirect
financial interest in Borrower or in any Affiliate of Borrower, and (ii) is not
connected with Borrower or any Affiliate of Borrower as an officer, employee,
trustee, partner, director or person performing similar functions.

 

“Index Maturity” has the meaning set forth in the definition of LIBOR.

 

“Instruments” means all of Property-Owning Borrower’s right, title and interest,
whether now owned or hereafter acquired, in, to and under all “instruments” as
defined in the UCC.

 

“Insurance Escrow Account” has the meaning set forth in Section 3.13(b).

 

“Insurance Premiums” has the meaning set forth in Section 5.1(x)(iii).

 

“Insurance Proceeds” means, in the event of a casualty with respect to the
Property, the proceeds received under any insurance policy applicable thereto.

 

“Insurance Requirements” means all material terms of any insurance policy
required pursuant to this Agreement and all material regulations, rules and
other requirements of the National Board of Fire Underwriters or such other body
exercising similar functions applicable to or affecting the Property or any part
thereof or any use or condition thereof.

 

“Insured Casualty” has the meaning set forth in Section 5.1(x)(iv)(B).

 

“Intellectual Property” means all of Property-Owning Borrower’s right, title and
interest, whether now owned or hereafter acquired, in, to and under the
trademark licenses, trademarks, rights in intellectual property, trade names,
service marks and copyrights, copyright licenses, patents, patent licenses or
the license to use intellectual property such as computer software owned or
licensed by Property-Owning Borrower or other proprietary business information
relating to Property-Owning Borrower’s policies, procedures, manuals and trade
secrets.

 

“Interest Accrual Period” means, in connection with the calculation of interest
accrued with respect to any Payment Date, the period commencing on and including
the eleventh (11th) day in the month preceding the month in which such Payment
Date occurs through and

 

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including the tenth (10th) day in the month in which such Payment Date occurs;
provided, however, that the first Interest Accrual Period for the Loan shall
commence on the initial Advance Closing Date.

 

“Interest Determination Date” means, in connection with the calculation of
interest to accrue for any Interest Accrual Period, the second Business Day
preceding the eleventh (11th) day of the month in which such Interest Accrual
Period commences; provided, however, that the first Interest Determination Date
for the Loan shall be the second Business Day preceding the Closing Date.

 

“Inventory” means all of Property-Owning Borrower’s right, title and interest,
whether now owned or hereafter acquired, in, to and under all “inventory” as
defined in the UCC and shall include all Documents representing the same.

 

“Investment Property” means all of Property-Owning Borrower’s right, title and
interest, whether now owned or hereafter acquired, in, to and under all
“investment property” as defined in the UCC.

 

“Joinder” means, with respect to each Advance, the Joinder, dated as of the
applicable Advance Closing Date, executed by the related Property-Owning
Borrower pursuant to which such Property-Owning Borrower joins in and assumes
the obligations of the Borrower under the Loan on a joint and several basis, to
the Agent for the benefit of the Lenders, as same may thereafter from time to
time be supplemented, amended, modified or extended by one or more agreements
supplemental thereto.

 

“Land” has the meaning provided in the Mortgage.

 

“Leases” means all leases, subleases, lettings, occupancy agreements, tenancies
and licenses by Property-Owning Borrower as landlord of the Property or any part
thereof now or hereafter entered into, and all amendments, extensions, renewals
and guarantees thereof, and all security therefor.

 

“Lease Guarantor”, “Lease Guaranty” and “Lease Insurance Policy” have the
meanings set forth in Section 2.3(xi)(4).

 

“Leasing Commissions” means leasing commissions incurred by Property-Owning
Borrower in connection with leasing the Property or any portion thereof
(including renewals of existing Leases).

 

“Leasing Costs/TI Costs Account” has the meaning set forth in Section 3.13(a).

 

“Leasing Costs/TI Costs Amount” means one-twelfth (1/12th) of the annual per
square foot or per unit amount which, in connection with an Advance applied to
acquire Property, the Agent may require be deposited on subsequent Payment Dates
into the Leasing Costs/TI Costs Account on a monthly basis to be applied to
Leasing Commissions and TI Costs (taking into account, in connection with CTL
Properties only, any deposits to reserves or payments expressly required to be
made by tenants under Credit Leases).

 

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“Legal Requirements” means all governmental statutes, laws, rules, orders,
regulations, ordinances, judgments, decrees and injunctions of Governmental
Authorities (including, without limitation, Environmental Laws) affecting
Borrower or the Property or any part thereof or the construction, use,
alteration or operation thereof, or any part thereof (whether now or hereafter
enacted and in force), and all permits, licenses and authorizations and
regulations relating thereto, and all covenants, agreements, restrictions and
encumbrances contained in any instruments, at any time in force affecting the
Property or any part thereof (including, without limitation, any which may
(i) require repairs, modifications or alterations in or to the Property or any
part thereof, or (ii) in any way limit the use and enjoyment thereof).

 

“Lender” has the meaning provided in the first paragraph of this Agreement.

 

“Letter of Credit Rights” means all of Property-Owning Borrower’s right, title
and interest, whether now owned or hereafter acquired, in, to and under all
“letter of credit rights” as defined in the UCC.

 

“LIBOR” means the rate per annum calculated as set forth below:

 

(i)            On each Interest Determination Date, LIBOR will be determined on
the basis of the offered rate for deposits of not less than U.S. $1,000,000 for
a period of one month (the “Index Maturity”), commencing on such Interest
Determination Date, which appears on Reuters Screen LIBOR01 (or the successor
thereto) as of 11:00 a.m., London time, on the related Interest Determination
Date.  If no such offered rate appears, LIBOR with respect to the relevant
Interest Accrual Period will be determined as described in (ii) below.

 

(ii)           If on any Interest Determination Date, such rate does not appear
on Reuters Screen LIBOR01 as of 11:00 a.m., London time, on such Interest
Determination Date, Agent shall request the principal London office of any four
major reference banks in the London interbank market selected by Agent to
provide such bank’s offered quotation (expressed as a percentage per annum) to
prime banks in the London interbank market for deposits in U.S. dollars for a
one-month period as of 11:00 a.m., London time, on such Interest Determination
Date.  If at least two such offered quotations are so provided, LIBOR shall be
the arithmetic mean of such quotations.  If fewer than two such quotations are
so provided, Agent shall request any three major banks in New York City selected
by Agent to provide such bank’s rate (expressed as a percentage per annum) for
loans in U.S. dollars to leading European banks for a one-month period as of
approximately 11:00 a.m., New York City time on the applicable Interest
Determination Date.  If at least two such rates are so provided, LIBOR shall be
the arithmetic mean of such rates.  LIBOR shall be determined by Agent or its
agent, which determination shall be conclusive absent manifest error.

 

All percentages resulting from any calculations of LIBOR referred to in this
Agreement will be carried out to five decimal places and all U.S. dollar amounts
used in or resulting from such calculations will be rounded upwards to the
nearest cent.

 

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“Lien” means any mortgage, deed of trust, lien (statutory or other), pledge,
hypothecation, assignment, security interest, or any other encumbrance or charge
on or affecting Borrower or the Property or any portion thereof, or any interest
therein (including, without limitation, any conditional sale or other title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing, and mechanic’s, materialmen’s and other similar
liens and encumbrances).

 

“Loan” and “Loan Amount” have the meanings set forth in the Recitals hereto.

 

“Loan Documents” means this Agreement, the Note, the Pledge Agreements, the
Environmental Indemnity Agreement, the Guaranty, the Master License Agreement,
the Collateral Assignment of Master License Agreement, the Memoranda of Negative
Pledge, the Real Estate Security Documents, the Contract Assignments, the
Manager’s Subordinations, the Joinders, any Indemnification Agreement and all
other agreements, instruments, certificates and documents delivered by or on
behalf of Borrower or an Affiliate of Borrower to evidence or secure the Loan as
same may be amended or modified from time to time.  Schedule III attached hereto
sets forth a list of the Loan Documents as of the date hereof.

 

“Loss Proceeds” means Condemnation Proceeds and/or Insurance Proceeds.

 

“Losses” has the meaning set forth in Section 5.1(j).

 

“Management Agreement” means with respect to each Property, the related property
management agreement entered into between the related Property-Owning Borrower
and the related property Manager, or in such other form as may be reasonably
approved by the Agent, as such agreement may be amended, modified or
supplemented and in effect from time to time.

 

“Manager” means with respect to each Property, the property manager for such
Property pursuant to a property management agreement.

 

“Manager’s Subordination” means, with respect to each Property, the related
Manager’s Consent and Subordination of Management Agreement, executed by the
related property Manager, the related Property-Owning Borrower and the Agent,
dated as of the applicable Advance Closing Date.

 

“Mandatory Initial Term Amortization Amount” shall mean $6,500,000.

 

“Material Adverse Effect” means a material adverse effect upon (i) the business
operations, properties, assets or condition (financial or otherwise) of
Borrower, (ii) the ability of Borrower to perform, or of Agent to enforce, any
of the Loan Documents or (iii) the aggregate value of the Property.

 

“Maturity Date” means the earlier of (a) the Original Maturity Date or if
Borrower exercises the Extension Option pursuant to Section 3.22, the Extended
Maturity Date, or (b) such earlier date on which the entire Loan is required to
be paid in full, by acceleration or otherwise under this Agreement or any of the
other Loan Documents.

 

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“Memoranda of Negative Pledge” means each such Memorandum of Negative Pledge,
collectively.

 

“Memorandum of Negative Pledge” means, with respect to each Property located in
any state that does not impose mortgage recording taxes, the related Memorandum
of Negative Pledge, dated as of the applicable Advance Closing Date, granted by
the applicable Property-Owning Borrower to the Agent for the benefit of the
Lenders with respect to such Property, as same may thereafter from time to time
be supplemented, amended, modified or extended by one or more agreements
supplemental thereto.

 

“Mezzanine Lender” means Goldman Sachs Commercial Mortgage Capital, L.P., a
Delaware limited partnership, Citicorp North America, Inc., a New York
corporation and SL Green Realty Corp., a Maryland corporation, together with
their successors and assigns in such capacities as lenders, each a “Mezzanine
Lender” and collectively, “Mezzanine Lenders”.

 

“Mezzanine Loan” means a loan made by Mezzanine Lender to American Financial
Reality Trust, GKK Stars Acquisition LLC, First States Group, L.P. and First
States Group, LLC, and other borrowers named therein by Mezzanine Lender
pursuant to the Mezzanine Loan Agreement.

 

“Mezzanine Loan Agreement” that certain loan agreement dated as of the Closing
Date by and among American Financial Reality Trust, GKK Stars Acquisition LLC,
First States Group, L.P. and First States Group, LLC and other borrowers named
therein and Mezzanine Lender.

 

“Mezzanine Loan Documents” means collectively, the Mezzanine Loan Agreement and
all agreements, certificates or other documents evidencing or securing or
executed in connection with the Mezzanine Loan.

 

“Money” means all of Borrower’s right, title and interest, whether now owned or
hereafter acquired, in, to and under (i) all “money” as defined in the UCC and
(ii) all moneys, cash, or other items of legal tender generated from the use or
operation of the Property.

 

“Monthly Statement” has the meaning set forth in Section 3.12(d).

 

“Mortgage” means, with respect to each Property, the related first priority
Mortgage or Deed of Trust, Assignment of Leases and Rents, Security Agreement
and Fixture Filing, dated as of the applicable Advance Closing Date, granted by
the applicable Property-Owning Borrower to or for the benefit of either Agent or
Deed of Trust Trustee for the benefit of Agent with respect to the such Property
as security for the Loan, as same may thereafter from time to time be
supplemented, amended, modified or extended by one or more agreements
supplemental thereto.

 

“Mortgage Recording Tax Escrow Account” has the meaning set forth in
Section 3.13(c).

 

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“Multiemployer Plan” means a multiemployer plan defined as such in Section 3(37)
of ERISA and which is covered by Title IV of ERISA (i) to which contributions
have been, or were required to have been made by Borrower or any ERISA Affiliate
or (ii) with respect to which Borrower could reasonably be expected to incur
liability.

 

“Net Proceeds” means either (x) the purchase price (at foreclosure or otherwise)
actually received by Agent from a third party purchaser with respect to the
Collateral, as a result of the exercise by Agent of its rights, powers,
privileges and other remedies after the occurrence of an Event of Default or
(y) in the event that Agent (or its nominee) or a Lender is the purchaser at
foreclosure of the Collateral, the higher of (i) the amount of Agent’s or such
Lender’s credit bid or (ii) such amount as shall be determined in accordance
with applicable law, and in either case minus all reasonable third party, out of
pocket costs and expenses (including, without limitation, all attorneys’ fees
and disbursements and any brokerage fees, if applicable) incurred by Agent (and
its nominee, if applicable) or such Lender in connection with the exercise of
such remedies; provided, however, that such costs and expenses shall not be
deducted to the extent such amounts previously have been added to the
Indebtedness in accordance with the terms of the Loan Documents or applicable
law.

 

“New Ground Lease” means, after the termination or expiration of the Ground
Lease, any new, replacement or substitute Ground Lease issued to or obtained by
Agent or its designee with respect to or in place of the terminated Ground
Lease, whether pursuant to any provision of the terminated Ground Lease or
otherwise.

 

“Note” means the Amended and Restated Promissory Note made by Borrower to
initial Lender pursuant to this Agreement, dated as of the date hereof, as such
note may be modified, amended, supplemented or extended.

 

“OFAC” has the meaning set forth in Section 4.1(v).

 

“Officer’s Certificate” means a certificate delivered to Agent by Borrower which
is signed by an authorized officer of Borrower.

 

 “Operating Budget” means, with respect to any Fiscal Year, the operating budget
for the Property reflecting Borrower’s projections of Gross Revenues and
Property Expenses for the Property for such Fiscal Year and on an annual and
monthly basis and submitted by Borrower to Agent in accordance with the
provisions of Section 5.1(r)(vi).

 

“Organizational Agreements” means, individually or collectively, as applicable
(i) the agreement of limited partnerships of the Holding Company Borrowers, and
(ii) the comparable organizational or constituent documentation for each
Property-Owning Borrower, each as amended or restated from time to time.

 

“Original Closing Date”, “Original Holding Company Borrower”, “Original Loan”
and “Original Property-Owning Borrowers” have the respective meanings set forth
in the Recitals hereto.

 

 “Original Maturity Date” has the meaning set forth in Section 3.22(a).

 

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“Other Borrowings” means, with respect to Borrower, without duplication (but not
including the Indebtedness) (i) all indebtedness of Borrower for borrowed money
or for the deferred purchase price of property or services, (ii) all
indebtedness of Borrower evidenced by a note, bond, debenture or similar
instrument, (iii) the face amount of all letters of credit issued for the
account of Borrower and, without duplication, all unreimbursed amounts drawn
thereunder, and obligations evidenced by bankers’ acceptances, (iv) all
indebtedness of Borrower secured by a Lien on any property owned by Borrower
(whether or not such indebtedness has been assumed), (v) all Contingent
Obligations of Borrower, (vi) liabilities and obligations for the payment of
money relating to a capitalized lease obligation or sale/leaseback obligation,
(vii) liabilities and obligations representing the balance deferred and unpaid
of the purchase price of any property or services, except those incurred in the
ordinary course of Borrower’s business that would constitute ordinarily a trade
payable to trade creditors, and (viii) all payment obligations of Borrower under
any interest rate protection agreement (including, without limitation, any
interest rate swaps, caps, floors, collars or similar agreements) and similar
agreements.

 

“Payment Date” has the meaning provided in Section 3.5(a).

 

“Payment Date Statement” has the meaning provided in Section 3.12(a).

 

“Payment Intangibles” means all of Property-Owning Borrower’s right, title and
interest, whether now owned or hereafter acquired, in, to and under all “payment
intangibles” as defined in the UCC.

 

“PBGC” means the Pension Benefit Guaranty Corporation established under ERISA,
or any successor thereto.

 

“Permits” means all licenses, permits, variances and certificates required by
Legal Requirements to be obtained by Property-Owning Borrower and used in
connection with the ownership, operation, use or occupancy of the Property
(including, without limitation, business licenses, state health department
licenses, licenses to conduct business and all such other permits, licenses and
rights, obtained from any Governmental Authority or private Person concerning
ownership, operation, use or occupancy of the Property).

 

“Permitted Encumbrances” means, with respect to the Property, collectively,

 

(i)            the Lien created by the Mortgages, or any other Loan Documents of
record,

 

(ii)           all Liens, easements, restrictions, covenants and other matters
disclosed on the Title Insurance Policy concerning the Property,

 

(iii)          Liens, if any, for Impositions imposed by any Governmental
Authority not yet delinquent or being contested in good faith and by appropriate
proceedings in accordance with the Mortgages,

 

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(iv)          mechanic’s or materialmen’s Liens, if any, being contested in good
faith and by appropriate proceedings in accordance with the Mortgages, provided
that no foreclosure has been commenced by the lien claimant,

 

(v)           rights of existing and future tenants and residents as tenants
only pursuant to Leases, and

 

(vi)          Liens for public utilities,

 

which Liens and encumbrances referred to in clauses (i)-(vi) above do not
materially and adversely affect (1) the ability of Borrower to pay in full the
Principal Indebtedness and interest thereon in a timely manner or (2) the use of
the Property for the use currently being made thereof, the operation of the
Property as currently being operated or the value of the Property.

 

“Permitted Guarantor Transfer” means any direct or indirect, voluntary or
involuntary, sale, conveyance, pledge, assignment, encumbrance, disposition or
other transfer, either in one or a series of transactions, of any direct or
indirect legal or beneficial interest in Guarantor and/or any rights,
distributions, profits or proceeds relating thereto.

 

“Permitted Investments” means any one or more of the following obligations or
securities acquired at a purchase price of not greater than par:

 

(i)            obligations of, or obligations fully guaranteed as to payment of
principal and interest by, the United States or any agency or instrumentality
thereof provided such obligations are backed by the full faith and credit of the
United States of America;

 

(ii)           obligations of the following United States of America government
sponsored agencies:  Federal Home Loan Mortgage Corp. (debt obligations), the
Farm Credit System (consolidated systemwide bonds and notes), the Federal Home
Loan Banks (consolidated debt obligations), the Federal National Mortgage
Association (debt obligations), the Financing Corp. (debt obligations), and the
Resolution Funding Corp. (debt obligations);

 

(iii)          federal funds, unsecured certificates of deposit, time deposits,
bankers’ acceptances and repurchase agreements with maturities of not more than
365 days of any bank, the short-term obligations of which are rated in the
highest short-term rating category by the Rating Agencies;

 

(iv)          unsecured certificates of deposit, time deposits, federal funds or
banker’s acceptances issued by any depository institution or trust company
incorporated under the laws of the United States or of any state thereof and
subject to supervision and examination by federal and/or state banking
authorities, which investments are fully insured by the Federal Deposit
Insurance Corp.;

 

(v)           debt obligations with maturities of not more than 365 days and
rated by the Rating Agencies in its highest long-term unsecured rating category;

 

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(vi)          commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a specified
date not more than one year after the date of issuance thereof) with maturities
of not more than 270 days and that is rated by the Rating Agencies in their
highest short-term unsecured debt rating;

 

(vii)         the Federated Prime Obligation Money Market Fund (the “Fund”) so
long as the Fund is rated “AAAm” or “AAAm-G” (or the equivalent) by the Rating
Agencies;

 

(viii)        any other demand, money market or time deposit, demand obligation
or any other obligation, security or investment, which the Agent shall have
approved in writing;

 

provided, however, that (A) the investments described in clauses (i) through
(viii) above must have a predetermined fixed dollar of principal due at maturity
that cannot vary or change, (B) if such investments have a variable rate of
interest, such interest rate must be tied to a single interest rate index plus a
fixed spread (if any) and must move proportionately with that index, and
(C) such investments must not be subject to liquidation prior to their maturity
or have an “r” highlighter affixed to its rating; and provided, further, that,
in the judgment of Agent, such instrument continues to qualify as a “cash flow
investment” pursuant to Code Section 860G(a)(6) earning a passive return in the
nature of interest and that no instrument or security shall be a Permitted
Investment if such instrument or security evidences (x) a right to receive only
interest payments or (y) the right to receive principal and interest payments
derived from an underlying investment at a yield to maturity in excess of 120%
of the yield to maturity at par of such underlying investment.

 

“Permitted Transfers” means any of the following transfers:

 

(i)            any Permitted Guarantor Transfer; or

 

(ii)           the pledge, of the partnership interests, or, as the case may be,
limited liability company interests in Holding Company Borrower (collectively,
the “Mezzanine Equity Interests”) to Mezzanine Lender pursuant to the Mezzanine
Loan Documents as security for the Mezzanine Loan and any transfer of such
Mezzanine Equity Interests to the Mezzanine Lender in connection with the
exercise of remedies under the Mezzanine Loan Documents; provided, however, that
such transfer shall be conditioned on a replacement guarantor, satisfactory to
the Agent in its sole discretion, executing and delivering to Agent a
replacement Guaranty and one or more replacement Indemnification Agreements, in
each case, in a form substantially similar to the Guaranty and Indemnification
Agreements executed by the Guarantor prior to the date of such transfer,
pursuant to which such replacement guarantor shall undertake the obligations set
forth therein; and, provided further, that, notwithstanding anything in this
Agreement to the contrary, subsequent to any transfer of a Mezzanine Equity
Interest in connection with the exercise of remedies under the Mezzanine Loan
Documents in accordance with this clause (ii) of the definition of Permitted
Transfer, no Transfer of a direct or indirect ownership interest or voting right
in Borrower shall be permitted without Agent’s consent; or

 

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(iii)          any conveyance, assignment or sale or other disposition (and not
a mortgaging, encumbrance, pledging, hypothecation, or granting of a security
interest)(directly or indirectly) of the voting and beneficial ownership
interests in American Financial Realty Trust following which  Gramercy Capital
Corp., (1) owns (directly or indirectly) 51% or more of such voting and
beneficial ownership interests in American Financial Realty Trust and
(2) through ownership of American Financial Realty Trust, controls the
operations and management of Borrower.

 

 “Person” means any individual, corporation, limited liability company,
partnership, joint venture, estate, trust, unincorporated association, any
federal, state, county or municipal government or any bureau, department or
agency thereof and any fiduciary acting in such capacity on behalf of any of the
foregoing.

 

“Personalty” means all right, title and interest of Property-Owning Borrower in
and to all Equipment, Inventory, Accounts, General Intangibles, Instruments,
Investment Property, Receivables, Pledged Accounts, Deposit Accounts, Contracts
and Intellectual Property and all other personal property as defined in the
relevant UCC, now owned or hereafter acquired by Property-Owning Borrower and
now or hereafter affixed to, placed upon, used in connection with, arising from
or otherwise related to the Property or which may be used in or relating to the
planning, development, financing or operation of such Property, including,
without limitation, furniture, furnishings, equipment, machinery, money,
insurance proceeds, accounts, contract rights, trademarks, goodwill, chattel
paper, documents, trade names, licenses and/or franchise agreements, rights of
Property-Owning Borrower under leases of fixtures or other personal property or
equipment, inventory, all refundable, returnable or reimbursable fees, deposits
or other funds or evidences of credit or indebtedness deposited by or on behalf
of Property-Owning Borrower with any governmental authorities, boards,
corporations, providers of utility services, public or private, including
specifically, but without limitation, all refundable, returnable or reimbursable
tap fees, utility deposits, commitment fees and development costs.

 

“Plan” means an employee benefit or other plan, other than a Multiemployer Plan,
that is covered by Title N of ERISA or Section 302 of ERISA or Section 412 of
the Code, and (i) was established or maintained by Borrower or any ERISA
Affiliate during the five year period ended prior to the date of this Agreement
or to which Borrower or any ERISA Affiliate makes, is obligated to make or has,
within the five year period ended prior to the date of this Agreement, been
required to make contributions or (ii) with respect to which Borrower could
reasonably be expected to incur liability.

 

 “Pledge Agreement (Property-Owning Borrower)” means (i) with respect to each
Property-Owning Borrower, the Pledge Agreement from the applicable Holding
Company Borrower, to Agent for the benefit of the Lenders, dated as of date
hereof, or dated as of the respective Advance Closing Date, as applicable, as
same may thereafter from time to time be supplemented, amended, modified or
extended by one or more agreements supplemental thereto and (ii) with respect to
4200 Holdings, the Pledge Agreement from 4200 Holdings, to Agent for the benefit
of the Lenders, dated as of date hereof, as same may thereafter from time to
time be supplemented, amended, modified or extended by one or more agreements
supplemental thereto.

 

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“Pledge Agreements” means each Pledge Agreement (Property-Owning Borrower),
collectively.

 

“Pledged Accounts” means the Collection Account and the Reserve Account and any
successor accounts thereto.

 

“Policies” has the meaning provided in Section 5.1(x)(iii).

 

“Preliminary Due Diligence Package” means, with respect to any asset acquisition
proposed to be financed with the proceeds of an Advance, a summary memorandum
outlining the proposed transaction, including potential transaction benefits and
all material underwriting risks, all Underwriting Issues and all other
characteristics of the proposed transaction that a reasonable lender would
consider material, together with the following due diligence information
relating to such assets to be provided by Holding Company Borrowers to Agent
pursuant to this Agreement:

 

(i)            the Collateral Information;

 

(ii)           current rent roll, if applicable;

 

(iii)          cash flow pro-forma, plus historical information, if available;

 

(iv)          description of the Property;

 

(v)           indicative debt service coverage ratios;

 

(vi)          indicative loan-to-value ratio;

 

(vii)         term sheet outlining the transaction generally;

 

(viii)        the submission to the Borrower’s and the Guarantor’s credit
committee; and

 

(ix)           any exceptions to the representations and warranties set forth in
Article IV to this Agreement.

 

“Principal Indebtedness” means the aggregate principal amount of the Advances
outstanding as adjusted by each increase (including for advances made by Lenders
to protect the Collateral), or decrease in such principal amount of the Loan
outstanding, whether as a result of prepayment or otherwise, from time to time.

 

“Proceeds” shall have the meaning given in the UCC and, in any event, shall
include, without limitation, all of Property-Owning Borrower’s right, title and
interest in and to proceeds, product, offspring, rents, profits or receipts, in
whatever form, arising from the Collateral.

 

“Prohibited Person” has the meaning set forth in Section 4.1(v).

 

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“Property” means the CTL Property or the Conduit CMBS Property acquired with the
proceeds of each Advance.

 

“Property Expenses” means, with respect to the Property, the following costs and
expenses but only, in the case of costs and expenses in respect of goods and
services, to the extent that they (x) are paid to Persons who are generally in
the business of providing such goods and services, (y) are customary for the
types of goods or services provided in the geographical area in which such goods
or services are provided and (z) do not constitute Capital Improvement Costs:

 

(i)            Impositions;

 

(ii)           insurance premiums for policies of insurance required to be
maintained by Borrower with respect to the Property pursuant to this Agreement
or the other Loan Documents;

 

(iii)          the cost of all electricity, oil, gas, water, steam, heat,
ventilation, air conditioning and any other energy, utility or similar item and
overtime services with respect to the Property;

 

(iv)          payments required under service contracts (including, without
limitation, service contracts for heating, ventilation and air conditioning
systems, elevators, landscape maintenance, pest extermination, security,
furniture, trash removal, answering service and credit checks);

 

(v)           wages, benefits, payroll taxes, uniforms, the cost of cleaning
supplies, insurance costs and all related expenses for maintenance personnel for
the Property (including, without limitation, housekeeping employees, porters and
general repair, maintenance and security employees), whether hired by Borrower,
Manager, Collateral Agent or any other Person;

 

(vi)          costs required in connection with the enforcement of any Lease
(including, without limitation, reasonable attorneys’ fees, charges for lock
changes and storage and moving expenses for furniture, fixtures and equipment
and expenses to relet the premises);

 

(vii)         advertising and rent-up expenses (including, without limitation,
leasing services, tenant rent concessions, promotions for existing and
prospective tenants, banners, signs and brokerage commissions);

 

(viii)        out-of-pocket cleaning, maintenance and repair expenses;

 

(ix)           any expense the total cost of which is passed through to tenants
pursuant to executed Leases;

 

(x)            legal, accounting, auditing and other professional fees and
expenses incurred in connection with the ownership, leasing and operation of the
Property (including, without limitation, collection costs and expenses);

 

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(xi)           permits, licenses and registration fees and costs;

 

(xii)          any expense necessary in order to prevent a breach under a Lease;

 

(xiii)         any expense necessary in order to prevent or cure a violation of
any Legal Requirement (including Environmental Law), regulation, code or
ordinance;

 

(xiv)        costs and expenses of any appraisals, valuations, surveys,
inspections, environmental assessments or market studies:

 

(xv)         costs and expenses of security and security systems provided to
and/or installed and maintained with respect to the Property;

 

(xvi)        costs of title, UCC, litigation and other searches and costs of
maintaining the Lien of the Mortgage thereon and the security interest in any
related Collateral;

 

(xvii)       fees and expenses of property managers contracted with by Borrower
to perform management, administrative, payroll or other services in connection
with the operation of the Property (including, without limitation, the fees and
expenses owed to Manager under the Management Agreement);

 

(xviii)      any other costs and expenses contemplated by the Operating Budget
and customarily incurred in connection with operating properties similar in type
and character to the Property (including rent for any management office);

 

(xix)         any cost or expense to comply with the requirements of any Leases,
whether expended by the Borrower, the Manager, the Collateral Agent or any other
Person.

 

(xx)          any other category of property expense that is customary for a
property of the type and size as the Property and is reasonably approved by
Agent on behalf of the Lenders.

 

“Property-Owning Borrower” means each Current Property-Owning Borrower and each
Future Property-Owning Borrower. “Property-Owning Borrowers” means the Current
Property-Owning Borrowers and Future Property-Owning Borrowers.

 

“Property Sub-Account” has the meaning provided in Section 3.12(a)(ii).

 

“Property Sub-Accounts” has the meaning provided in Section 3.12(a)(ii).

 

“Quarterly Statement” has the meaning provided in Section 5.1(r)(vii).

 

“Real Estate Closing” means, with respect to any Property, the closing that
shall be deemed to have occurred when (1) the Real Estate Security Documents
applicable to such Property shall have been filed of record in the appropriate
filing office in the jurisdiction in which such Property is located or
irrevocably delivered to the Title Agent for such recordation and all mortgage
recording taxes incurred or to be incurred in connection therewith shall have

 

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been paid by the Borrower and (2) the Title Insurance Policy shall have been
purchased by the Lender and paid for by the Borrower, as evidenced by the
delivery of a marked-up Title Insurance Policy.

 

“Real Estate Security Documents” means, with respect to each Advance for the
acquisition of Property, the related Mortgage(s) and the related
Assignment(s) of Rents and Leases.

 

“Real Estate Taxes Escrow Account” has the meaning provided in Section 3.13(b).

 

“Receivables” means all of Property-Owning Borrower’s right, title and interest,
whether now owned or hereafter acquired, in, to and under (i) any Accounts,
Chattel Paper, Instruments, Payment Intangibles, Letter of Credit Rights,
Documents, insurance policies, drafts, bills of exchange, trade acceptances,
notes or other indebtedness owing to Property-Owning Borrower from whatever
source arising, (ii) to the extent not otherwise included above, (a) all income,
Rents, issues, profits, revenues, deposits and other benefits from the Property
and (b) all receivables and other obligations now existing or hereafter arising,
or created out of the sale, lease, sublease, license, concession or other grant
of the right of the use and occupancy of property or rendering of services by
Property-Owning Borrower or any operator or manager of the Property or other
commercial space located at the Property or acquired from others (including,
without limiting the generality of the foregoing, from rental of space, halls,
stores, and offices, and deposits securing reservations of such space, exhibit
or sales space of every kind, license, lease, sublease and concession fees and
rentals, health club membership fees, food and beverage wholesale and retail
sales of merchandise, service charges, vending machine sales and proceeds, if
any, from business interruption or other loss of income insurance, (iii) all of
the books and records (whether in tangible, electronic or other form) now or
hereafter maintained by or on behalf of Mortgagor in connection with the
operation of the Property or in connection with any of the foregoing and
(iv) all Supporting Obligations and all liens and security interests securing
any of the foregoing and all other rights, privileges and remedies relating to
any of the foregoing.

 

 “Regions Master License” has the meaning provided in Section 2.1(o).

 

 “Regions Properties” means those certain properties listed on Schedule IV
attached hereto.

 

“Release” means any active or passive release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dispersal, leaching or
migration into the indoor or outdoor environment (including, without limitation,
the movement of Hazardous Substances through ambient air, soil, surface water,
ground water, wetlands, land or subsurface strata).

 

“Release Condition” means, with respect to any proposed Capital Event of a
Property, the condition that shall be satisfied if the Agent determines in its
sole discretion that such proposed Capital Event shall not have a Material
Adverse Effect and that following such Capital Event no mandatory principal
payments are due and payable pursuant to Section 3.7(c).

 

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“Remedial Work” has the meaning set forth in Section 5.1(d)(i).

 

“Rents” means all income, rents, issues, profits, revenues (including all oil
and gas or other mineral royalties and bonuses), deposits (other than utility
and security deposits) and other benefits from the Property.

 

“Replacement Reserve Account” has the meaning set forth in Section 3.13(a).

 

“Replacement Reserve Amount” means one-twelfth (1/12th) of the annual per square
foot or per unit amount which, in connection with an Advance applied to acquire
Property, the Agent, may require be deposited on subsequent Payment Dates into
the Replacement Reserve Account on a monthly basis to be applied to replacement
reserve items (taking into account, in connection with CTL Properties only, any
deposits to reserves or payments expressly required to be made by tenants under
Credit Leases).

 

“Reserve Account” means the Deferred Maintenance Escrow Account, the Replacement
Reserve Account, the Leasing Costs/TI Costs Account, the Real Estate Taxes
Escrow Account, the Insurance Escrow Account, and the Mortgage Recording Tax
Escrow Account, collectively, and any successor accounts to any of the
foregoing.

 

“Single-Purpose Entity” means a Person, other than an individual, which (i) is
formed or organized under the laws of a state of the United States or the
District of Columbia solely for the purpose of acquiring and directly (or in the
case of the Holding Company Borrowers, indirectly) holding an ownership interest
in the Property, (ii) does not engage in any business unrelated to the Property,
(iii) does not have any assets other than those related to its interest in the
Property (or in the case of the Holding Company Borrowers, their interest in the
Property-Owing Borrowers) or any indebtedness other than as permitted by this
Agreement, the Mortgages or the other Loan Documents, (iv) has its own separate
books and records and has its own accounts, in each case which are separate and
apart from the books and records and accounts of any other Person, (v) is
subject to all of the limitations on powers set forth in the Organizational
Agreement as of the Closing Date, (vi) holds itself out as being a Person
separate and apart from any other Person and (vii) has, or is controlled,
directly or indirectly, by a Person that has, at least one independent director
that is not an employee, officer, director, or paid consultant of any Affiliate
of such Person or of any principal or officer of such Person.

 

“SNDA” has the meaning set forth in Section 2.3(b)(x)(7).

 

“Supplemental Due Diligence List” shall mean, with respect to any assets
proposed to be acquired with the proceeds of an Advance, information or
deliveries concerning the assets that Agent shall reasonably request in addition
to the Preliminary Due Diligence Package.

 

“Supporting Obligations” means all of Property-Owning Borrower’s right, title
and interest, whether now owned or hereafter acquired, in, to and under (i) all
“supporting obligations” as defined in the UCC and (ii) any other guarantee,
letter of credit, secondary obligation, right or privilege that supports or
pertains to any of the Property.

 

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“Survey” means an ALTA/ACSM survey of the Property prepared by a registered
Independent surveyor, in form and content satisfactory to the Agent and the
Borrower.

 

“Taking” means a taking or voluntary conveyance during the term hereof of all or
part of the Property, or any interest therein or right accruing thereto or use
thereof, as the result of, or in settlement of, any condemnation or other
eminent domain proceeding by any Governmental Authority affecting the Property
or any portion thereof whether or not the same shall have actually been
commenced.

 

“TI Costs” means tenant improvement costs and allowances incurred by Borrower in
connection with renewing existing Leases or executing new Leases for space
located in the Property.

 

“Title Agent” means a title company proposed by Borrower and reasonably
acceptable to the Agent.

 

“Title Insurance Policy” means a mortgagee’s title insurance policy or policies
(i) issued by Chicago Title Insurance Company or one or more title companies
reasonably satisfactory to Agent which policy or policies shall be in form ALTA
1992 (with waiver of arbitration provisions as provided for by the applicable
and respective state’s title policy endorsement) (with reinsurance as Agent may
require reasonably satisfactory to Agent and at amounts reasonably acceptable to
the primary insurer), naming Agent as the insured party for benefit of the
Lenders, (ii) insuring the Mortgage as being a first and prior lien upon the
Property, (iii) showing no encumbrances against the Property (whether junior or
superior to the Mortgage) which are not acceptable to Agent other than Permitted
Encumbrances, (iv) in an amount acceptable to Agent (but not more than the Loan
Amount), and (v) otherwise in form and content reasonably acceptable to Agent.
Such Title Insurance Policy shall include the following endorsements or
affirmative coverages in form and substance reasonably acceptable to Agent, to
the extent legally permitted and available in the jurisdiction in which the Land
is located:  variable rate endorsement; survey endorsement; comprehensive
endorsement; first loss, last dollar and tie-in endorsement; access coverage;
separate tax parcel coverage; contiguity (if applicable) coverage; and such
other endorsements as Agent shall reasonably require in order to provide
insurance against specific risks identified by Agent in connection with the
Property.

 

“Transaction” means the transactions contemplated by the Loan Documents.

 

“Transaction Costs” means all costs and expenses paid or payable by Borrower
relating to the Transaction (including, without limitation, reasonable transfer,
mortgage and recording fees and costs, appraisal fees, legal fees and accounting
fees and the costs and expenses described in Section 8.23).

 

“Transfer” means the conveyance, assignment, sale, mortgaging, encumbrance
(other than a Permitted Encumbrance), pledging, hypothecation, granting of a
security interest in, granting of options with respect to, or other disposition
of (directly or indirectly, voluntarily or involuntarily, by operation of law or
otherwise, and whether or not for consideration or of record) all or any portion
of any legal or beneficial interest (a) in all or any portion of the Property;
or (b) in the stock, partnership interests, membership interests or other
ownership

 

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interests in Borrower and shall also include, without limitation to the
foregoing, the following:  an installment sales agreement wherein Borrower
agrees to sell the Property or any part thereof or any interest therein for a
price to be paid in installments; a sale, assignment or other transfer of, or
the grant of a security interest in, Borrower’s right, title and interest in and
to any Leases or any Rent; and any instrument subjecting the Property to a
condominium regime or transferring ownership to a cooperative corporation.

 

“Triple Net Lease” shall mean a lease under which the tenant pays for all or
substantially all real estate property taxes, property insurance, and operating
expenses of the Property.

 

“UCC” means with respect to any Collateral, the Uniform Commercial Code as in
effect from time to time in the State of New York; provided, that if by reason
of mandatory provisions of law, the perfection or the effect of perfection or
non-perfection or priority of the security interest in any item or portion of
the Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, “UCC” shall mean the Uniform
Commercial Code as in effect in such other jurisdiction for purposes of the
provisions hereof relating to such perfection or effect of perfection or
non-perfection or priority. Wherever this agreement refers to terms as defined
in the UCC, if such term is defined in more than one Article of the UCC, the
definition in Article 9 of the UCC shall control.

 

“Underwriting Issues” shall mean, with respect to any assets as to which Holding
Company Borrowers intends to request an Advance, all material information that
has come to Holding Company Borrowers’ attention that, based on the making of
reasonable inquiries and the exercise of reasonable care and diligence under the
circumstances, would be considered a materially “negative” factor (either
separately or in the aggregate with other information), or a material defect in
documentation or closing deliveries, to a reasonable institutional mortgage
lender in determining whether to finance the assets in question.

 

“Use” means, with respect to any Hazardous Substance, the generation,
manufacture, processing, distribution, handling, use, treatment, recycling or
storage of such Hazardous Substance or transportation of such Hazardous
Substance in connection with or affecting Borrower or the Property.

 

“Welfare Plan” means an employee welfare benefit plan as defined in
Section 3(1) of ERISA established or maintained by Borrower or any ERISA
Affiliate or with respect to which Borrower or any ERISA Affiliate has an
obligation to make contributions and covers any current or former employee of
Borrower or any ERISA Affiliate.

 

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ARTICLE II.
CONDITIONS PRECEDENT

 

SECTION 2.1.                                   CONDITIONS PRECEDENT TO CLOSING. 
THE OBLIGATION OF THE AGENT TO MAKE THE LOAN IS SUBJECT TO THE SATISFACTION BY
BORROWER (AND GUARANTOR AND 4200 HOLDINGS, WHERE APPLICABLE) OF THE FOLLOWING
CONDITIONS NO LATER THAN THE CLOSING DATE:

 

(A)                                  LOAN AGREEMENT.  HOLDING COMPANY BORROWERS,
CURRENT PROPERTY-OWNING BORROWERS, COLLATERAL AGENT, AND AGENT SHALL HAVE
EXECUTED AND DELIVERED THIS AGREEMENT.

 

(B)                                 NOTE.  HOLDING COMPANY BORROWERS AND CURRENT
PROPERTY-OWNING BORROWERS SHALL HAVE EXECUTED AND DELIVERED TO AGENT THE NOTE.

 

(C)                                  ENVIRONMENTAL INDEMNITY AGREEMENT;
GUARANTY; PLEDGE AGREEMENTS AND FINANCING STATEMENTS.  HOLDING COMPANY
BORROWERS, CURRENT PROPERTY-OWNING BORROWERS AND GUARANTOR SHALL HAVE EXECUTED
AND DELIVERED THE ENVIRONMENTAL INDEMNITY AGREEMENT TO THE AGENT FOR BENEFIT OF
THE LENDERS.  GUARANTOR SHALL HAVE EXECUTED AND DELIVERED THE GUARANTY AND THE
INDEMNIFICATION AGREEMENT RELATED TO THE PROPERTIES OWNED BY THE CURRENT
PROPERTY-OWNING BORROWERS.  EACH HOLDING COMPANY BORROWER AND 4200 HOLDINGS
SHALL HAVE EXECUTED AND DELIVERED A PLEDGE AGREEMENT (PROPERTY-OWNING BORROWER)
TO THE AGENT FOR BENEFIT OF THE LENDERS.  BORROWER SHALL HAVE COOPERATED WITH
THE AGENT WITH RESPECT TO ALL FINANCING STATEMENTS REQUIRED TO BE FILED IN ORDER
TO PERFECT AGENT’S SECURITY INTEREST IN THE COLLATERAL. TITLE AGENT, HOLDING
COMPANY BORROWERS AND THE AGENT SHALL HAVE EXECUTED AND DELIVERED THE ESCROW
AGREEMENT.

 

(D)                                 OPINIONS OF COUNSEL.  THE INITIAL LENDER AND
COLLATERAL AGENT SHALL HAVE RECEIVED FROM COUNSEL TO BORROWER AND GUARANTOR,
LEGAL OPINIONS IN FORM AND SUBSTANCE ACCEPTABLE TO AGENT, WITH RESPECT TO
CORPORATE MATTERS. SUCH LEGAL OPINIONS SHALL BE ADDRESSED TO AGENT AND ITS
SUCCESSORS AND ASSIGNS, DATED THE CLOSING DATE, AND IN FORM AND SUBSTANCE
REASONABLY SATISFACTORY TO AGENT AND ITS COUNSEL.

 

(E)                                  ORGANIZATIONAL DOCUMENTS.  THE INITIAL
LENDER SHALL HAVE RECEIVED WITH RESPECT TO EACH OF HOLDING COMPANY BORROWER AND
THE GUARANTOR ITS CERTIFICATE OF FORMATION OR CERTIFICATE OF INCORPORATION, AS
APPLICABLE, AS AMENDED, MODIFIED OR SUPPLEMENTED TO THE CLOSING DATE, AS FILED
WITH THE SECRETARY OF STATE IN THE JURISDICTION OF ORGANIZATION AND IN EFFECT ON
THE CLOSING DATE AND CERTIFIED TO BE TRUE, CORRECT AND COMPLETE BY THE
APPROPRIATE SECRETARY OF STATE AS OF A DATE NOT MORE THAN TWENTY (20) DAYS PRIOR
TO THE CLOSING DATE, TOGETHER WITH, IF AVAILABLE, A GOOD STANDING CERTIFICATE
FROM SUCH SECRETARY OF STATE AND, FOR HOLDING COMPANY BORROWERS ONLY, A GOOD
STANDING CERTIFICATE FROM THE SECRETARIES OF STATE (OR THE EQUIVALENT THEREOF)
OF EACH OTHER STATE IN WHICH EACH HOLDING COMPANY BORROWER IS REQUIRED TO BE
QUALIFIED TO TRANSACT BUSINESS.

 

(F)                                    CERTIFIED RESOLUTIONS, ETC.  THE INITIAL
LENDER SHALL HAVE RECEIVED A CERTIFICATE OF EACH OF THE HOLDING COMPANY
BORROWERS AND THE GUARANTOR DATED THE CLOSING DATE, CERTIFYING (I) THE NAMES AND
TRUE SIGNATURES OF ITS INCUMBENT OFFICERS AUTHORIZED TO SIGN THE LOAN DOCUMENTS
TO WHICH EACH HOLDING COMPANY BORROWER OR THE GUARANTOR IS A PARTY, (II) THE

 

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ORGANIZATIONAL AGREEMENT OF EACH HOLDING COMPANY BORROWER AS IN EFFECT ON THE
CLOSING DATE, (III) THE RESOLUTIONS OF EACH OF THE HOLDING COMPANY BORROWERS AND
THE GUARANTOR, APPROVING AND AUTHORIZING THE EXECUTION, DELIVERY AND PERFORMANCE
OF THE LOAN DOCUMENTS TO WHICH IT IS A PARTY, AND (IV) THAT THERE HAVE BEEN NO
CHANGES IN ANY ORGANIZATIONAL AGREEMENT SINCE THE DATE OF EXECUTION OR
PREPARATION THEREOF.

 

(G)                                 ADDITIONAL MATTERS.  THE AGENT SHALL HAVE
RECEIVED SUCH OTHER CERTIFICATES, OPINIONS, DOCUMENTS AND INSTRUMENTS RELATING
TO THE LOAN AS MAY HAVE BEEN REASONABLY REQUESTED BY AGENT. ALL CORPORATE AND
OTHER ORGANIZATIONAL PROCEEDINGS, ALL OTHER DOCUMENTS (INCLUDING, WITHOUT
LIMITATION, ALL DOCUMENTS REFERRED TO HEREIN AND NOT APPEARING AS EXHIBITS
HERETO) AND ALL LEGAL MATTERS IN CONNECTION WITH THE LOAN SHALL BE REASONABLY
SATISFACTORY IN FORM AND SUBSTANCE TO AGENT.

 

(H)                                 ADVISORY FEE; TRANSACTION COSTS.  BORROWER
SHALL HAVE PAID THE ADVISORY FEE AND ALL TRANSACTION COSTS FOR WHICH BILLS HAVE
BEEN SUBMITTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 8.23 IN EXCESS OF
THE $100,000 LEGAL DUE DILIGENCE DEPOSIT.

 

(I)                                     NO DEFAULT OR EVENT OF DEFAULT.  NO
DEFAULT OR EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE CONTINUING ON THE CLOSING
DATE.

 

(J)                                     NO INJUNCTION.  NO LAW OR REGULATION
SHALL HAVE BEEN ADOPTED, NO ORDER, JUDGMENT OR DECREE OF ANY GOVERNMENTAL
AUTHORITY SHALL HAVE BEEN ISSUED, AND NO LITIGATION SHALL BE PENDING OR
THREATENED, WHICH IN THE GOOD FAITH JUDGMENT OF THE INITIAL LENDER WOULD ENJOIN,
PROHIBIT OR RESTRAIN, OR IMPOSE OR RESULT IN THE IMPOSITION OF ANY MATERIAL
ADVERSE CONDITION UPON, THE MAKING OR REPAYMENT OF THE LOAN OR THE CONSUMMATION
OF THE TRANSACTION.

 

(K)                                  REPRESENTATIONS AND WARRANTIES.  THE
REPRESENTATIONS AND WARRANTIES HEREIN AND IN THE OTHER LOAN DOCUMENTS SHALL BE
TRUE AND CORRECT IN ALL MATERIAL RESPECTS ON THE CLOSING DATE.

 

(L)                                     FILINGS, REGISTRATIONS, RECORDING.  ANY
DOCUMENTS (INCLUDING, WITHOUT LIMITATION, FINANCING STATEMENTS) REQUIRED TO BE
FILED, REGISTERED OR RECORDED IN ORDER TO CREATE, IN FAVOR OF THE AGENT, A
PERFECTED, FIRST-PRIORITY SECURITY INTEREST IN THE COLLATERAL, SUBJECT TO NO
LIENS OTHER THAN PERMITTED ENCUMBRANCES, SHALL HAVE BEEN PROPERLY PREPARED AND
EXECUTED FOR FILING, REGISTRATION OR RECORDING IN EACH OFFICE IN EACH
JURISDICTION IN WHICH SUCH FILINGS, REGISTRATIONS AND RECORDATIONS ARE REQUIRED
TO PERFECT SUCH FIRST-PRIORITY SECURITY INTEREST.

 

(M)                               CONSENTS, LICENSES, APPROVALS, ETC.  THE AGENT
SHALL HAVE RECEIVED COPIES CERTIFIED BY THE BORROWER OF ALL CONSENTS, LICENSES
AND APPROVALS, IF ANY, REQUIRED IN CONNECTION WITH THE EXECUTION, DELIVERY AND
PERFORMANCE BY THE BORROWER OF, AND THE VALIDITY AND ENFORCEABILITY OF, THE LOAN
DOCUMENTS, WHICH CONSENTS, LICENSES AND APPROVALS SHALL BE IN FULL FORCE AND
EFFECT.

 

(N)                                 COLLECTION ACCOUNT AND RESERVE ACCOUNT.  THE
COLLECTION ACCOUNT AND RESERVE ACCOUNT SHALL HAVE BEEN ESTABLISHED WITH THE
COLLATERAL AGENT, AND THE TERMS OF ALL DOCUMENTATION RELATING TO SUCH ACCOUNTS
SHALL BE IN ACCORDANCE WITH THE REQUIREMENTS OF THE LOAN DOCUMENTS AND SHALL BE
SATISFACTORY TO THE AGENT IN FORM AND SUBSTANCE AND THE HOLDING

 

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COMPANY BORROWERS SHALL PROVIDE EVIDENCE OF SAME, INCLUDING ANY AGREEMENTS WITH
RESPECT THERETO.

 

(O)                                 REGIONS MASTER LICENSE.  BORROWER SHALL HAVE
PROVIDED A MASTER LICENSE AGREEMENT, DATED AS OF THE DATE HEREOF, EXECUTED BY
EACH HOLDING COMPANY BORROWER AND GUARANTOR, IN FORM AND SUBSTANCE ACCEPTABLE TO
AGENT, WHICH SHALL COVER THE REDUCTION IN RENTAL INCOME CAUSED BY SCHEDULED RENT
STEP DOWNS WITH RESPECT TO THE REGIONS PROPERTIES (THE “REGIONS MASTER
LICENSE”).  BORROWER SHALL HAVE ALSO PROVIDED A COLLATERAL ASSIGNMENT OF THE
MASTER LICENSE AGREEMENT, DATED AS OF THE DATE HEREOF, EXECUTED BY EACH HOLDING
COMPANY BORROWER AND GUARANTOR, IN FORM AND SUBSTANCE ACCEPTABLE TO AGENT (THE
“COLLATERAL ASSIGNMENT OF THE MASTER LICENSE AGREEMENT”).

 

(P)                                 OTHER DOCUMENTS.  THE AGENT SHALL HAVE
RECEIVED SUCH OTHER DOCUMENTS AS THE AGENT OR ITS COUNSEL MAY REASONABLY
REQUEST.

 

SECTION 2.2.                                   EXECUTION AND DELIVERY OF
AGREEMENT.  THE EXECUTION AND DELIVERY OF THIS AGREEMENT BY EACH PARTY TO THIS
AGREEMENT SHALL BE DEEMED TO CONSTITUTE THE SATISFACTION OR WAIVER OF THE
CONDITIONS SET FORTH IN SECTION 2.1.

 

SECTION 2.3.                                   ADVANCE PROCEDURE.

 

(A)                                  PRELIMINARY APPROVAL.  HOLDING COMPANY
BORROWERS SHALL GIVE AGENT THREE (3) BUSINESS DAYS PRIOR WRITTEN NOTICE OF EACH
PROPOSED ADVANCE AND AGENT SHALL INFORM HOLDING COMPANY BORROWERS OF ITS
DETERMINATION WITH RESPECT TO ANY ASSETS PROPOSED TO BE ACQUIRED BY BORROWER
SOLELY IN ACCORDANCE WITH THE PROCEDURE SET FORTH BELOW. AGENT SHALL HAVE THE
RIGHT TO REVIEW ALL ASSETS PROPOSED TO BE FINANCED BY AGENT WITH THE PROCEEDS OF
AN ADVANCE AND TO CONDUCT ITS OWN DUE DILIGENCE INVESTIGATION OF SUCH ASSETS AS
AGENT REASONABLY DETERMINES. AGENT SHALL BE ENTITLED TO MAKE A DETERMINATION, IN
THE EXERCISE OF ITS GOOD FAITH BUSINESS JUDGMENT, THAT IT SHALL OR SHALL NOT
FINANCE ANY OR ALL OF THE ASSETS PROPOSED TO BE FINANCED BY AGENT WITH THE
PROCEEDS OF AN ADVANCE.

 

(I)                                     HOLDING COMPANY BORROWERS MAY, FROM TIME
TO TIME, SUBMIT TO AGENT A PRELIMINARY DUE DILIGENCE PACKAGE FOR AGENT’S REVIEW
AND APPROVAL IN ORDER TO MAKE AN ADVANCE WITH RESPECT TO ANY PROPERTY THAT THE
HOLDING COMPANY BORROWERS PROPOSES TO CAUSE A PROPERTY-OWNING BORROWER TO
ACQUIRE AND FINANCE UNDER THIS AGREEMENT.

 

(II)                                  UPON AGENT’S RECEIPT OF A COMPLETE
PRELIMINARY DUE DILIGENCE PACKAGE, AGENT, WITHIN FIVE (5) BUSINESS DAYS, SHALL
HAVE THE RIGHT TO REQUEST, IN AGENT’S GOOD FAITH BUSINESS JUDGMENT, ADDITIONAL
DILIGENCE MATERIALS AND DELIVERIES THAT AGENT SHALL SPECIFY ON A SUPPLEMENTAL
DUE DILIGENCE LIST. UPON AGENT’S RECEIPT OF ALL OF THE DILIGENCE MATERIALS OR
AGENT’S WAIVER THEREOF, AGENT, WITHIN SEVEN (7) BUSINESS DAYS SHALL EITHER
(I) NOTIFY HOLDING COMPANY BORROWERS (X) THAT IT HAS OBTAINED INTERNAL CREDIT
APPROVAL; (Y) OF THE ADVANCE RATE, AND (Z) OF THE CAPITAL MARKETS EXECUTION FOR
THE ASSETS OR (II) DENY, IN AGENT’S SOLE AND ABSOLUTE DISCRETION, THE REQUEST
FOR AN ADVANCE. AGENT’S FAILURE TO RESPOND TO HOLDING COMPANY BORROWERS WITHIN
SEVEN (7) BUSINESS DAYS SHALL

 

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BE DEEMED TO BE A DENIAL OF HOLDING COMPANY BORROWERS’ REQUEST FOR AN ADVANCE,
UNLESS AGENT AND HOLDING COMPANY BORROWERS HAVE AGREED OTHERWISE IN WRITING.

 

(B)                                 FINAL APPROVAL.  UPON AGENT’S NOTIFICATION
TO HOLDING COMPANY BORROWERS OF THE ADVANCE RATE AND THE CAPITAL MARKETS
EXECUTION FOR ANY ASSETS, HOLDING COMPANY BORROWERS SHALL, IF HOLDING COMPANY
BORROWERS DESIRE TO OBTAIN AN ADVANCE WITH RESPECT TO SUCH ASSETS, SATISFY THE
CONDITIONS SET FORTH BELOW (IN ADDITION TO SATISFYING THE CONDITIONS PRECEDENT
TO OBTAINING EACH ADVANCE, AS SET FORTH IN SECTION 2.4 OF THIS AGREEMENT) AS A
CONDITION PRECEDENT TO AGENT’S APPROVAL OF SUCH ASSETS AS PROPERTY, ALL IN A
MANNER REASONABLY SATISFACTORY TO AGENT AND PURSUANT TO DOCUMENTATION REASONABLY
SATISFACTORY TO AGENT:

 

(I)                                     SURVEY; APPRAISAL. AGENT SHALL HAVE
RECEIVED THE SURVEY AND THE APPRAISAL WITH RESPECT TO THE PROPERTY, WHICH SHALL
BE IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO AGENT.

 

(II)                                  ENGINEERING REPORT. AGENT SHALL HAVE
RECEIVED THE ENGINEERING REPORT WITH RESPECT TO THE PROPERTY PREPARED BY THE
ENGINEER, WHICH ENGINEERING REPORT SHALL BE REASONABLY ACCEPTABLE TO AGENT.

 

(III)                               ENVIRONMENTAL MATTERS. AN ENVIRONMENTAL
REPORT PREPARED BY AN ENVIRONMENTAL AUDITOR WITH RESPECT TO THE PROPERTY SHALL
HAVE BEEN MADE AVAILABLE TO THE AGENT, WHICH ENVIRONMENTAL REPORT SHALL BE
REASONABLY ACCEPTABLE TO AGENT.

 

(IV)                              PROPERTY INFORMATION. AGENT SHALL HAVE
RECEIVED REASONABLY ACCEPTABLE INFORMATION RELATING TO THE PROPERTY, WHICH SHALL
INCLUDE THE FOLLOWING, TO THE EXTENT REASONABLY AVAILABLE:

 

(1)                                  OPERATING STATEMENTS FOR THE CURRENT YEAR
(INCLUDING ACTUAL TO DATE INFORMATION, AN ANNUAL BUDGET AND TRAILING TWELVE
MONTH DATA IN HARD COPY AND ON DISKETTE) AND FOR THE IMMEDIATELY PRECEDING YEAR
(INCLUDING TENANT IMPROVEMENTS COSTS, LEASING COMMISSIONS, CAPITAL RESERVES,
MAJOR REPAIRS, REPLACEMENT ITEMS AND OCCUPANCY RATES IN HARD COPY AND ON
DISKETTE);

 

(2)                                  COPIES OF LEASES WITH RESPECT TO THE
TENANTS OF THE PROPERTY, A COPY OF THE STANDARD LEASE FORM, IF ANY, AND TENANT
LEASE ABSTRACTS;

 

(3)                                  CURRENT PROPERTY RENT ROLL DATA ON A TENANT
BY TENANT BASIS IN HARD COPY; AND

 

(4)                                  CURRENT REAL ESTATE TAX BILLS (OR A
CERTIFICATION OF CURRENT TAX AMOUNTS EVIDENCED IN THE OWNER’S TITLE INSURANCE
POLICY).

 

(V)                                 PRO-FORMA FINANCIAL STATEMENT; OPERATING
BUDGET.  AGENT SHALL HAVE RECEIVED (I) THE INITIAL PRO FORMA FINANCIAL STATEMENT
AND OPERATING BUDGET FOR THE PROPERTY FOR THE FOLLOWING TWELVE MONTHS (INCLUDING
ON AN ANNUAL AND MONTHLY BASIS A BREAK-DOWN OF PROJECTED GROSS REVENUES,
PROPERTY EXPENSES, CAPITAL IMPROVEMENT COSTS (INCLUDING LEASING COMMISSIONS AND
TI COSTS), REPLACEMENT RESERVE COSTS AND

 

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AVERAGE OCCUPANCY LEVEL (EXPRESSED AS A PERCENTAGE)), (II) A FINANCIAL STATEMENT
THAT FORECASTS PROJECTED REVENUES AND OPERATING EXPENSES FOR NOT LESS THAN THREE
YEARS (INCLUDING THE ASSUMPTIONS USED IN SUCH FORECAST), AND (III) ANY LOCAL
MARKET STUDY AND/OR RESEARCH AND DEMOGRAPHICS REPORT PREPARED FOR BORROWER.

 

(VI)                              SITE INSPECTION.  BORROWER SHALL HAVE PROVIDED
TO AGENT THE OPPORTUNITY TO PERFORM, OR CAUSE TO BE PERFORMED ON ITS BEHALF, AN
ON-SITE DUE DILIGENCE REVIEW OF THE PROPERTY WHICH INSPECTION IS SATISFACTORY TO
AGENT IN ITS SOLE DISCRETION.

 

(VII)                           INSURANCE.  AGENT SHALL HAVE RECEIVED
CERTIFICATES OF INSURANCE DEMONSTRATING INSURANCE COVERAGE IN RESPECT OF THE
PROPERTY OF TYPES, IN AMOUNTS, WITH INSURERS AND OTHERWISE IN COMPLIANCE WITH
THE TERMS, PROVISIONS AND CONDITIONS SET FORTH IN THIS AGREEMENT. SUCH
CERTIFICATES SHALL INDICATE THAT AGENT IS A NAMED ADDITIONAL INSURED AND SHALL
CONTAIN A LOSS PAYEE ENDORSEMENT IN FAVOR OF AGENT WITH RESPECT TO THE PROPERTY
POLICIES REQUIRED TO BE MAINTAINED UNDER THIS AGREEMENT.

 

(VIII)                        LIEN SEARCH REPORTS.  TO THE EXTENT NOT COVERED BY
THE MATERIALS DELIVERED BY THE TITLE INSURANCE COMPANY IN CONNECTION WITH THE
TITLE COMMITMENT, AGENT SHALL HAVE RECEIVED SATISFACTORY REPORTS OF TAX LIEN AND
JUDGMENT SEARCHES AND TITLE UPDATES CONDUCTED BY THE TITLE COMPANIES OR SEARCH
FIRMS ACCEPTABLE TO THE AGENT WITH RESPECT TO THE PROPERTY, SUCH SEARCHES TO BE
CONDUCTED IN EACH OF THE LOCATIONS REQUIRED BY AGENT.

 

(IX)                                CONSENTS, LICENSES, APPROVALS, ETC.  AGENT
SHALL HAVE RECEIVED COPIES OF ALL CONSENTS, LICENSES AND APPROVALS, IF ANY,
REQUIRED IN CONNECTION WITH THE EXECUTION, DELIVERY AND PERFORMANCE BY BORROWER
AND COLLATERAL AGENT, AND THE VALIDITY AND ENFORCEABILITY, OF THE LOAN
DOCUMENTS, AND SUCH CONSENTS, LICENSES AND APPROVALS SHALL BE IN FULL FORCE AND
EFFECT.

 

(X)                                   CERTIFICATES OF OCCUPANCY, ZONING
REPORTS.  AGENT SHALL HAVE RECEIVED COPIES OF CERTIFICATES OF OCCUPANCY ISSUED
BY THE APPROPRIATE GOVERNMENTAL AUTHORITY OF THE JURISDICTION IN WHICH THE
PROPERTY IS LOCATED REFLECTING, AND CONSISTENT WITH, THE USE OF THE PROPERTY AS
OF THE ADVANCE CLOSING DATE AND EVIDENCE THAT THE PROPERTY IS IN COMPLIANCE WITH
ALL APPLICABLE ZONING LAWS, RULES AND REGULATIONS (WHICH ITEMS MAY BE SATISFIED
THROUGH THE DELIVERY OF A REPORT FROM THE PLANNING AND ZONING RESOURCE
CORPORATION WITH RESPECT TO THE PROPERTY).

 

(XI)                                ADDITIONAL REAL ESTATE MATTERS.  AGENT SHALL
HAVE RECEIVED SUCH OTHER REAL ESTATE RELATED CERTIFICATES AND DOCUMENTATION
RELATING TO THE PROPERTY AS AGENT MAY HAVE REASONABLY REQUESTED. SUCH
DOCUMENTATION SHALL INCLUDE THE FOLLOWING AS REQUESTED BY AGENT AND TO THE
EXTENT REASONABLY AVAILABLE:

 

(1)                                  A CERTIFIED COPY OF THE PURCHASE AND SALE
AGREEMENT (WITH EXHIBITS) FOR THE PROPERTY;

 

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(2)                                  ESTOPPEL CERTIFICATES IN FORM AND SUBSTANCE
REASONABLY ACCEPTABLE TO AGENT IN RESPECT OF SUCH PERCENTAGE OF THE RENTABLE
SQUARE FOOTAGE RENTED TO COMMERCIAL TENANTS AS SHALL BE REASONABLY ACCEPTABLE TO
AGENT;

 

(3)                                  GRAPHICS (INCLUDING INTERIOR AND EXTERIOR
PHOTOGRAPHS, RENTAL BROCHURES AND A COMPETITIVE PROPERTIES MAP) AS REQUIRED BY
AGENT;

 

(4)                                  WITH RESPECT TO EACH CTL PROPERTY:

 

(A)                              AT LEAST ONE SIGNED COPY OF THE CREDIT LEASE,

 

(B)                                AT LEAST ONE SIGNED COPY OF EACH AMENDMENT,
MODIFICATION, ASSIGNMENT, AND ASSUMPTION OF THE CREDIT LEASE,

 

(C)                                AT LEAST ONE SIGNED COPY OF THE GUARANTY OF A
CREDIT LEASE (A “LEASE GUARANTY”), IF ANY,

 

(D)                               A COPY OF THE OPINION OF COUNSEL FOR THE
CREDIT LEASE AND THE LEASE GUARANTY, IF ANY,

 

(E)                                 A COPY OF EVIDENCE OF FORMATION AND
AUTHORITY FOR THE TENANT AND ANY LEASE GUARANTOR, IF ANY,

 

(F)                                 A COPY OF THE “LEASE ENHANCEMENT POLICY” OR
“EXTENDED AMORTIZATION POLICY” OR “RESIDUAL VALUE INSURANCE POLICY” (THE “LEASE
INSURANCE POLICY”), IF ANY,

 

(G)                                AN ESTOPPEL CERTIFICATE DATED NO EARLIER THAN
90 DAYS BEFORE THE DATE OF DELIVERY, ADDRESSED TO HOLDING COMPANY BORROWERS AND
HOLDING COMPANY BORROWERS’ SUCCESSORS AND ASSIGNS, EXECUTED BY THE TENANT AND
THE GUARANTOR UNDER ANY LEASE GUARANTY (THE “LEASE GUARANTOR”),

 

(H)                               A SUBORDINATION, NONDISTURBANCE, AND
ATTORNMENT AGREEMENT BETWEEN THE TENANT AND PROPERTY-OWNING BORROWER CONFIRMING
THE CONTINUATION OF THE CREDIT LEASE AFTER ANY FORECLOSURE UNDER THE LOAN (THE
“SNDA”),

 

(I)                                    AN ORIGINAL ASSIGNMENT OF THE SNDA FROM
PROPERTY-OWNING BORROWER IN BLANK, IN RECORDABLE FORM IF THE SNDA WAS IN
RECORDABLE FORM, AND

 

(J)                                   A UCC-1 FINANCING STATEMENT RELATING TO
THE ASSIGNMENT TO AGENT OF THE LEASE GUARANTY, THE SNDA, AND ANY CLAIMS UNDER
THE LEASE INSURANCE POLICY; AND

 

(5)                                  WITH RESPECT TO EACH GROUND LEASE:

 

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(A)                              (A) ORIGINAL GROUND LESSOR’S ESTOPPEL
CERTIFICATE; (B) ORIGINAL FULLY EXECUTED COUNTERPART OR A CERTIFIED COPY OF THE
GROUND LEASE AND ALL AMENDMENTS REFERRED TO IN “A”; (C) COPY OF MEMORANDUM OF
LEASE, WITH RECORDING INFORMATION; (D) ORIGINAL OF ANY SEPARATE AGREEMENT, IF
ANY, BETWEEN THE GROUND LESSOR AND PROPERTY-OWNING BORROWER; (E) COPY OF AN
OPINION OF COUNSEL FOR GROUND LESSOR, IF ANY SUCH OPINION WAS OBTAINED; AND
(F) COPY OF RECORDED SUBORDINATION AGREEMENT FROM ANY FEE MORTGAGEE OF RECORD AT
THE TIME ITEM “C” WAS RECORDED.

 

(XII)                             TITLE COMMITMENT.  AGENT SHALL HAVE RECEIVED
THE TITLE COMMITMENT FOR THE PROPERTY, WHICH SHALL BE REASONABLY ACCEPTABLE TO
THE AGENT.

 

Within five (5) Business Days of Holding Company Borrowers’ satisfaction of all
of the conditions enumerated in clauses (i) through (xii) above, Agent shall
either (i) if the asset proposed to be acquired with the proceeds of the Advance
are not reasonably satisfactory in form and substance to Agent, notify Holding
Company Borrowers that Agent has not approved the asset as Property or
(ii) notify Holding Company Borrowers in writing that Agent has approved the
asset as Property (including in such notification (x) the related deposit
required to be made to the Deferred Maintenance Escrow Account and the Mortgage
Recording Tax Escrow Account out of the proceeds of the Advance, if any, (y) the
Replacement Reserve Amount, if any, and (z) the Leasing Costs/TI Costs Amount,
if any). Agent’s failure to respond to Holding Company Borrowers within five
(5) Business Days shall be deemed to be a denial of Holding Company Borrowers’
request that Agent approve the asset, unless Agent and Holding Company Borrowers
have agreed otherwise in writing.

 

(xiii)                          Officer’s Certificate.  Borrower shall have
delivered to Agent an Officer’s Certificate setting forth:

 

(1)                                  no Event of Default has occurred or is
continuing;

 

(2)                                  all representations and warranties made by
Borrower in the Loan Agreement with respect to the Properties securing both the
current Advance and all prior Advances remain true and correct as of the date of
such proposed Advance; and

 

(3)                                  except as provided in Section 3.11, no
Property that has previously been encumbered under the Loan has been released
from the Lien.

 

SECTION 2.4.                                   INITIAL AND SUBSEQUENT ADVANCES. 
THE MAKING OF EACH ADVANCE TO BORROWER ON ANY BUSINESS DAY IS SUBJECT TO THE
FOLLOWING FURTHER CONDITIONS PRECEDENT, BOTH IMMEDIATELY PRIOR TO THE MAKING OF
SUCH ADVANCE AND ALSO AFTER GIVING EFFECT THERETO AND TO THE INTENDED USE
THEREOF:

 

(A)                                  THE ESCROW AGREEMENT, TOGETHER WITH ANY
AMENDMENTS OR MODIFICATIONS THERETO REASONABLY REQUIRED IN AGENT’S DISCRETION,
SHALL BE IN FULL FORCE AND EFFECT;

 

(B)                                 NO DEFAULT OR EVENT OF DEFAULT SHALL HAVE
OCCURRED AND BE CONTINUING;

 

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(C)                                  THE REPRESENTATIONS AND WARRANTIES MADE BY
BORROWER IN ARTICLE IV HEREOF, AND IN EACH OF THE OTHER LOAN DOCUMENTS, SHALL BE
TRUE AND CORRECT ON AND AS OF THE DATE OF THE MAKING OF SUCH ADVANCE WITH THE
SAME FORCE AND EFFECT AS IF MADE ON AND AS OF SUCH DATE (OR, IF ANY SUCH
REPRESENTATION OR WARRANTY IS EXPRESSLY STATED TO HAVE BEEN MADE AS OF A
SPECIFIC DATE, AS OF SUCH SPECIFIC DATE);

 

(D)                                 THE AGGREGATE OUTSTANDING PRINCIPAL AMOUNT
OF THE ADVANCES SHALL NOT EXCEED THE MAXIMUM AMOUNT PERMITTED AT SUCH TIME UNDER
SECTION 3.7 HEREOF;

 

(E)                                  THE AGENT SHALL HAVE COMPLETED ITS DUE
DILIGENCE REVIEW OF THE PROPERTY BEING ACQUIRED WITH THE PROCEEDS OF SUCH
ADVANCE AND SUCH OTHER DOCUMENTS, RECORDS, AGREEMENTS, INSTRUMENTS OR
INFORMATION RELATING TO THE PROPERTY AS THE LENDER IN ITS REASONABLE DISCRETION
DEEMS APPROPRIATE TO REVIEW AND SUCH REVIEW SHALL BE SATISFACTORY TO THE LENDER
IN ITS REASONABLE DISCRETION;

 

(F)                                    THE LENDER SHALL HAVE RECEIVED THE
FOLLOWING PROPERTY-RELATED LOAN DOCUMENTS:

 

(I)                                     REAL ESTATE SECURITY DOCUMENTS;
MEMORANDUM OF NEGATIVE PLEDGE.  PROPERTY-OWNING BORROWER SHALL HAVE EXECUTED AND
DELIVERED TO TITLE AGENT THE REAL ESTATE SECURITY DOCUMENTS AND THE MEMORANDUM
OF NEGATIVE PLEDGE WITH RESPECT TO THE PROPERTY WITH A DIRECTION LETTER TO
RECORD THE MEMORANDUM OF NEGATIVE PLEDGE;

 

(II)                                  FINANCING STATEMENTS.  BORROWER SHALL HAVE
COOPERATED WITH AGENT IN THE PREPARATION OF ALL FINANCING STATEMENTS REQUIRED BY
AGENT PURSUANT HERETO AND SUCH FINANCING STATEMENTS SHALL HAVE BEEN IRREVOCABLY
DELIVERED TO THE TITLE AGENT;

 

(III)                               MANAGEMENT AGREEMENT AND MANAGER’S
SUBORDINATION.  WITH RESPECT TO THE PROPERTY, AGENT SHALL HAVE RECEIVED THE
EXECUTED MANAGEMENT AGREEMENT AND THE MANAGER AND PROPERTY-OWNING BORROWER SHALL
HAVE EXECUTED AND DELIVERED THE MANAGER’S SUBORDINATION TO AGENT;

 

(IV)                              CONTRACT ASSIGNMENT.  WITH RESPECT TO THE
PROPERTY, PROPERTY-OWNING BORROWER SHALL HAVE EXECUTED AND DELIVERED TO AGENT A
CONTRACT ASSIGNMENT;

 

(V)                                 ORGANIZATIONAL AGREEMENT; JOINDER.  THE
HOLDING COMPANY BORROWERS SHALL HAVE DELIVERED TO THE AGENT THE ORGANIZATIONAL
AGREEMENT FOR THE PROPERTY-OWNING BORROWER THAT WILL OWN SUCH PROPERTY, WHICH
SHALL BE IN FORM AND SUBSTANCE ACCEPTABLE TO THE AGENT AND SUCH PROPERTY-OWNING
BORROWER SHALL HAVE EXECUTED AND DELIVERED TO AGENT A JOINDER;

 

(VI)                              PLEDGE AGREEMENT.  THE HOLDING COMPANY
BORROWERS SHALL HAVE EXECUTED AND DELIVERED TO THE AGENT A SUPPLEMENT TO EACH OF
THE PLEDGE AGREEMENT (PROPERTY-OWNING BORROWER) AND THE UCC INSURANCE POLICY
CONFIRMING THAT THE AGENT HAS A PERFECTED FIRST PRIORITY SECURITY INTEREST IN
THE RELATED OWNERSHIP INTERESTS PLEDGED AS PART OF THE COLLATERAL;

 

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(VII)                           UCC INSURANCE POLICY.  AS TO ANY ADVANCE (OR
SERIES OF ADVANCES BEING MADE ON ANY SINGLE ADVANCE CLOSING DATE) IN AN
AGGREGATE AMOUNT OF NOT LESS THAN $25,000,000, THE BORROWER SHALL HAVE
COOPERATED WITH THE AGENT TO CAUSE THE ISSUANCE BY A TITLE COMPANY ACCEPTABLE TO
THE AGENT OF A UCC INSURANCE POLICY WITH RESPECT TO THE OWNERSHIP INTERESTS
PLEDGED TO THE AGENT UNDER AND PURSUANT TO THE PLEDGE AGREEMENTS IN AN AMOUNT
NOT LESS THAN THE AGGREGATE AMOUNT OF SUCH ADVANCE OR ADVANCES AND THE BORROWER
SHALL HAVE PAID ALL COSTS AND EXPENSES INCURRED IN CONNECTION THEREWITH;

 

(VIII)                        OPINIONS OF COUNSEL.  AGENT SHALL HAVE RECEIVED
FROM COUNSEL TO ANY NEW PROPERTY-OWNING BORROWER JOINING THIS AGREEMENT ON SUCH
ADVANCE CLOSING DATE ITS LEGAL OPINION IN FORM AND SUBSTANCE SATISFACTORY TO
AGENT, AS TO CORPORATE MATTERS. THE LEGAL OPINIONS WILL BE ADDRESSED TO AGENT
AND LENDERS AND THEIR SUCCESSORS AND ASSIGNS, DATED THE ADVANCE CLOSING DATE,
AND IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO AGENT AND ITS COUNSEL;

 

(IX)                                CLOSING STATEMENT.  THE AGENT AND BORROWER
SHALL HAVE AGREED UPON A DETAILED CLOSING STATEMENT FROM BORROWER IN A FORM
REASONABLY ACCEPTABLE TO THE AGENT, WHICH INCLUDES A COMPLETE DESCRIPTION OF
BORROWER’S SOURCES AND USES OF FUNDS ON THE CLOSING DATE; AND

 

(X)                                   INDEMNIFICATION AGREEMENT.  TO THE EXTENT
THE BORROWER HAS NOT DELIVERED ANY OF THE THIRD PARTY DUE DILIGENCE ITEMS SET
FORTH IN SECTION 2.3(B)(I)-(III), (V)-(X), AND (XII) ABOVE WITH RESPECT TO A
PROPOSED ASSET AND THE AGENT HAS NONETHELESS APPROVED THE ASSET AS A PROPERTY ON
THE CONDITION THAT GRAMERCY CAPITAL CORP., DELIVERS AN INDEMNIFICATION
AGREEMENT, THE AGENT SHALL HAVE RECEIVED FROM GRAMERCY CAPITAL CORP., AN
INDEMNIFICATION AGREEMENT, IN A FORM REASONABLY ACCEPTABLE TO THE AGENT.

 

(G)                                 BORROWER SHALL HAVE PAID ALL TRANSACTION
COSTS FOR WHICH BILLS HAVE BEEN SUBMITTED AND HAVE NOT BEEN PREVIOUSLY PAID.

 

ARTICLE III.
GENERAL TERMS

 

SECTION 3.1.                                   THE LOAN.

 

(A)                                  SUBJECT TO THE TERMS AND CONDITIONS OF THIS
AGREEMENT, THE LENDERS SHALL MAKE ADVANCES TO BORROWER FROM THE INITIAL ADVANCE
CLOSING DATE TO BUT EXCLUDING THE MATURITY DATE IN AN AGGREGATE PRINCIPAL AMOUNT
AT ANY ONE TIME OUTSTANDING UP TO THE LOAN AMOUNT. THE PROCEEDS OF THE LOAN
SHALL BE USED SOLELY FOR THE PURPOSES IDENTIFIED IN SECTION 3.2 HEREOF. ON EACH
ADVANCE CLOSING DATE, UPON THE SATISFACTION OF THE CONDITIONS SET FORTH IN
SECTION 3.3, AND 3.4, THE LENDERS SHALL INITIATE A WIRE OR OTHER TRANSFER OF
IMMEDIATELY AVAILABLE FUNDS TO AN ACCOUNT DESIGNATED BY BORROWER IN AN AMOUNT
EQUAL TO (X) THE RELATED ADVANCE RATE, LESS (Y) THE SUM OF (I) THE REASONABLE
OUT-OF-POCKET EXPENSES INCURRED BY AGENT IN CONNECTION WITH THE ORIGINATION AND
FUNDING OF THE ADVANCE, (II) THE REASONABLE FEES AND EXPENSES OF AGENT’S COUNSEL
AND (III) THE AMOUNT, IF ANY, REASONABLY REQUIRED BY THE AGENT IN WRITING TO BE
DEPOSITED IN THE DEFERRED MAINTENANCE ESCROW ACCOUNT, THE REAL ESTATE TAXES
ESCROW ACCOUNT OR THE INSURANCE ESCROW ACCOUNT PURSUANT TO SECTION 3.13.
ADVANCES SHALL ONLY BE AVAILABLE WHEN PROPERTY IS

 

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ADDED TO THE FACILITY AND SHALL ONLY BE AVAILABLE WITH RESPECT TO THE PROPERTY
BEING ADDED TO THE FACILITY ON THE APPLICABLE ADVANCE CLOSING DATE.  BORROWER
SHALL NOT BE PERMITTED TO REBORROW WITH RESPECT TO ANY ADVANCE THAT HAS BEEN
PREPAID IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT.  THE FOREGOING SHALL NOT
AFFECT BORROWER’S RIGHT TO MAKE PREPAYMENTS AND CONSUMMATE CAPITAL EVENTS IN
ACCORDANCE WITH THE TERMS OF THIS AGREEMENT.  IN NO EVENT SHALL AN ADVANCE BE
MADE WHEN ANY DEFAULT HAS OCCURRED AND IS CONTINUING. BORROWER MAY NOT RECEIVE,
WITHOUT AGENT’S WRITTEN CONSENT (I) MORE THAN TWO ADVANCES DURING ANY CALENDAR
MONTH, OR (II) AN ADVANCE IN AN AMOUNT LESS THAN $3,000,000.

 

(B)                                 THE LOAN SHALL CONSTITUTE ONE GENERAL
OBLIGATION OF BORROWER TO LENDERS AND SHALL BE SECURED BY THE SECURITY INTEREST
IN AND LIENS GRANTED UPON ALL OF THE COLLATERAL, AND BY ALL OTHER SECURITY
INTERESTS AND LIENS AT ANY TIME OR TIMES HEREAFTER GRANTED BY BORROWER TO AGENT
OR TO COLLATERAL AGENT ON BEHALF OF LENDERS AS SECURITY FOR THE LOAN.

 

SECTION 3.2.                                   USE OF PROCEEDS.  PROCEEDS OF THE
LOAN SHALL BE USED ONLY FOR THE FOLLOWING PURPOSES:  (A) TO FINANCE A PORTION OF
THE ACQUISITION COST OF OR REFINANCE THE PROPERTY, (B) TO MAKE THE REQUIRED
DEPOSITS TO THE DEFERRED MAINTENANCE ESCROW ACCOUNT, THE REAL ESTATE TAXES
ESCROW ACCOUNT, AND THE INSURANCE ESCROW ACCOUNT, (C) TO PAY TRANSACTION COSTS
(INCLUDING THE REASONABLE OUT OF POCKET EXPENSES INCURRED BY LENDERS IN
CONNECTION WITH THE ORIGINATION AND FUNDING OF THE LOAN) AND (D) TO PAY TO
COUNSEL TO EACH OF COLLATERAL AGENT, THE AGENT AND BORROWER ITS RESPECTIVE
REASONABLE FEES, EXPENSES AND DISBURSEMENTS.

 

SECTION 3.3.                                   SECURITY FOR THE LOAN.  THE NOTE
AND BORROWER’S OBLIGATIONS HEREUNDER AND UNDER ALL OTHER LOAN DOCUMENTS SHALL BE
SECURED BY (A) SO LONG AS AN EVENT OF DEFAULT HAS NOT OCCURRED AND IS NOT
CONTINUING, THE PLEDGE AGREEMENTS AND (B) IF AN EVENT OF DEFAULT HAS OCCURRED
AND IS CONTINUING, LIENS UPON THE PROPERTY PURSUANT TO THE MORTGAGES, THE
CONTRACT ASSIGNMENTS, THE MANAGER’S SUBORDINATIONS, THE ASSIGNMENTS OF LEASES
AND RENTS.

 

SECTION 3.4.                                   BORROWER’S NOTE.  BORROWER’S
OBLIGATION TO PAY THE PRINCIPAL OF AND INTEREST ON THE LOAN AND ALL OTHER
AMOUNTS DUE UNDER THE LOAN DOCUMENTS SHALL BE EVIDENCED INITIALLY BY THE NOTE,
DULY EXECUTED AND DELIVERED BY BORROWER ON THE CLOSING DATE. THE NOTE SHALL BE
PAYABLE AS TO PRINCIPAL, INTEREST AND ALL OTHER AMOUNTS DUE UNDER THE LOAN
DOCUMENTS, AS SPECIFIED IN THIS AGREEMENT, WITH A FINAL MATURITY ON THE MATURITY
DATE. THE INITIAL LENDER SHALL HAVE THE RIGHT TO HAVE THE NOTE SUBDIVIDED, BY
EXCHANGE FOR PROMISSORY NOTES OF LESSER DENOMINATIONS IN THE FORM OF THE INITIAL
NOTE, UPON WRITTEN REQUEST TO BORROWER AND, IN SUCH EVENT, BORROWER SHALL
PROMPTLY EXECUTE ADDITIONAL OR REPLACEMENT NOTES. AT NO TIME SHALL THE AGGREGATE
PRINCIPAL AMOUNT OF THE NOTE (OR OF SUCH REPLACEMENT NOTES) EXCEED THE LOAN
AMOUNT.

 

SECTION 3.5.                                   REPAYMENT OF ADVANCES; INTEREST.

 

(A)                                  BORROWER SHALL PAY TO AGENT INTEREST ON THE
PRINCIPAL INDEBTEDNESS OF THE LOAN FROM THE INITIAL ADVANCE CLOSING DATE TO BUT
EXCLUDING THE DATE THE LOAN SHALL BE PAID IN FULL AT THE INTEREST RATE PROVIDED
IN SECTION 3.5(B) BELOW. INTEREST ON THE LOAN SHALL ACCRUE ON THE PRINCIPAL
INDEBTEDNESS COMMENCING ON THE CLOSING DATE AND SHALL BE PAYABLE IN ARREARS ON
THE ELEVENTH (11TH) DAY OF THE MONTH FOLLOWING THE MONTH IN WHICH THE INITIAL
ADVANCE CLOSING DATE OCCURS AND ON THE ELEVENTH (11TH) DAY OF EACH AND EVERY
MONTH THEREAFTER THROUGH THE MONTH IN WHICH THE MATURITY DATE OCCURS, UNLESS, IN
ANY SUCH CASE, SUCH DAY IS NOT A BUSINESS DAY, IN

 

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WHICH EVENT SUCH INTEREST SHALL BE PAYABLE ON THE FIRST BUSINESS DAY FOLLOWING
SUCH DATE (SUCH DATE FOR ANY PARTICULAR MONTH, THE “PAYMENT DATE”). THE AGENT
AND THE COLLATERAL AGENT SHALL CALCULATE LIBOR ON EACH INTEREST DETERMINATION
DATE FOR THE RELATED INTEREST ACCRUAL PERIOD AND PROMPTLY COMMUNICATE TO
BORROWER SUCH RATE FOR SUCH PERIOD. THE ENTIRE OUTSTANDING PRINCIPAL
INDEBTEDNESS OF THE LOAN AND THE NOTE, TOGETHER WITH ALL ACCRUED BUT UNPAID
INTEREST THEREON AND ALL OTHER AMOUNTS DUE UNDER THE LOAN DOCUMENTS, SHALL BE
DUE AND PAYABLE BY BORROWER TO THE LENDERS ON THE MATURITY DATE. INTEREST SHALL
BE COMPUTED ON THE BASIS OF A 360 DAY YEAR AND THE ACTUAL NUMBER OF DAYS
ELAPSED.

 

(B)                                 EACH ADVANCE SHALL BEAR INTEREST DURING EACH
INTEREST ACCRUAL PERIOD FROM AND INCLUDING ITS RESPECTIVE ADVANCE CLOSING DATE
AT A RATE PER ANNUM EQUAL TO THE SUM OF (X) THE GREATER OF (I) 3.50% AND
(II) LIBOR DETERMINED AS OF THE INTEREST DETERMINATION DATE IMMEDIATELY
PRECEDING SUCH INTEREST ACCRUAL PERIOD PLUS (Y) THE APPLICABLE MARGIN.

 

(C)                                  [RESERVED].

 

(D)                                 WHILE AN EVENT OF DEFAULT HAS OCCURRED AND
IS CONTINUING, BORROWER SHALL PAY TO AGENT INTEREST AT THE DEFAULT RATE ON ANY
AMOUNT OWING TO THE LENDERS NOT PAID WHEN DUE UNTIL SUCH AMOUNT IS PAID IN FULL.

 

SECTION 3.6.                                   VOLUNTARY PREPAYMENT.

 

(A)                                  BORROWER MAY VOLUNTARILY PREPAY THE LOAN IN
WHOLE OR IN PART ON ANY PAYMENT DATE; PROVIDED, HOWEVER, THAT, ANY SUCH
PREPAYMENT SHALL BE ACCOMPANIED BY AN AMOUNT REPRESENTING ALL ACCRUED INTEREST
ON THE PORTION OF THE LOAN BEING PREPAID AND OTHER AMOUNTS THEN DUE UNDER THE
LOAN DOCUMENTS.

 

(B)                                 IN THE EVENT OF ANY SUCH VOLUNTARY
PREPAYMENT, BORROWER SHALL GIVE AGENT WRITTEN NOTICE (OR TELEPHONIC NOTICE
PROMPTLY CONFIRMED IN WRITING) OF ITS INTENT TO PREPAY, WHICH NOTICE SHALL BE
GIVEN AT LEAST TEN (10) DAYS’ PRIOR TO THE DATE UPON WHICH PREPAYMENT IS TO BE
MADE AND SHALL SPECIFY THE PAYMENT DATE ON WHICH SUCH PREPAYMENT IS TO BE MADE
AND THE AMOUNT OF SUCH PREPAYMENT (WHICH SHALL NOT BE LESS THAN $1,000,000). IF
ANY SUCH NOTICE IS GIVEN, THE AMOUNT SPECIFIED IN SUCH NOTICE SHALL BE DUE AND
PAYABLE ON THE PAYMENT DATE SPECIFIED THEREIN (UNLESS SUCH NOTICE IS REVOKED BY
BORROWER PRIOR TO THE DATE SPECIFIED THEREIN IN WHICH EVENT BORROWER SHALL
IMMEDIATELY REIMBURSE AGENT FOR ANY OUT-OF-POCKET COSTS INCURRED IN CONNECTION
WITH THE GIVING OF SUCH NOTICE AND ITS REVOCATION).

 

SECTION 3.7.                                   MANDATORY PREPAYMENT; CAPITAL
EVENTS; CERTAIN TRANSFERS.

 

(A)                                  SO LONG AS NO EVENT OF DEFAULT HAS OCCURRED
AND IS CONTINUING, BORROWER MAY ENTER INTO A CAPITAL EVENT WITH RESPECT TO ONE
OR MORE PROPERTIES, WHICH WERE ACQUIRED WITH THE PROCEEDS OF AN ADVANCE;
PROVIDED, HOWEVER, THAT (I) BORROWER SHALL HAVE GIVEN AGENT AT LEAST FIFTEEN
(15) BUSINESS DAYS’ PRIOR WRITTEN NOTICE OF THE CAPITAL EVENT AND (II) BY NOT
LATER THAN TEN (10) BUSINESS DAYS FOLLOWING THE RECEIPT OF SUCH NOTICE, THE
AGENT SHALL HAVE NOTIFIED THE BORROWER THAT THE RELEASE CONDITION HAS BEEN
SATISFIED.

 

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(B)                                 EXCEPT AS OTHERWISE PROVIDED IN
SECTION 3.12(E) IN THE EVENT LOSS PROCEEDS ARE REQUIRED TO BE MADE AVAILABLE FOR
RESTORATION PURSUANT TO SECTION 5.1(X) OF THIS AGREEMENT AND EXCLUDING LOSS
PROCEEDS WHICH BORROWER IS OBLIGATED TO TURN OVER TO TENANTS OR OTHER THIRD
PERSONS PURSUANT TO APPLICABLE LAW, IN THE EVENT OF A CASUALTY OR A TAKING OF
THE PROPERTY, IN WHOLE OR IN PART, BORROWER SHALL CAUSE ALL SUCH LOSS PROCEEDS
OTHERWISE PAYABLE WITH RESPECT TO THE PROPERTY TO BE DEPOSITED DIRECTLY INTO THE
COLLECTION ACCOUNT IN ACCORDANCE WITH SECTION 3.12(A)(III) AND SHALL ON THE
PAYMENT DATE OCCURRING IMMEDIATELY FOLLOWING THE RECEIPT OF SUCH LOSS PROCEEDS,
APPLY SUCH PORTION OF LOSS PROCEEDS SOLELY TO MAKE THE PAYMENTS REQUIRED
PURSUANT TO ITEM (III) OF CLAUSE FIRST OF SECTION 3.12(B) OF THIS AGREEMENT.

 

(C)                                  IF THE LENDER DETERMINES WITH RESPECT TO
ANY ADVANCE THAT THE OUTSTANDING PRINCIPAL AMOUNT OF SUCH ADVANCE IS GREATER
THAN 80% OF THE THEN CURRENT RELATED CAPITAL MARKETS EXECUTION AND SO NOTIFIES
BORROWER ON ANY BUSINESS DAY, THEN THE BORROWER SHALL BY NO LATER THAN
FORTY-EIGHT (48) HOURS AFTER RECEIPT OF SUCH NOTICE PREPAY THE RELATED ADVANCE
IN PART (OR IF REQUESTED BY THE BORROWER AND ACCEPTABLE TO THE AGENT IN ITS SOLE
DISCRETION, PLEDGE ADDITIONAL COLLATERAL TO THE AGENT FOR THE BENEFIT OF THE
LENDERS) SUCH THAT AFTER GIVING EFFECT TO SUCH PREPAYMENT OR PLEDGE (OR BOTH),
THE OUTSTANDING PRINCIPAL AMOUNT OF SUCH ADVANCE DOES NOT EXCEED 80% OF THE THEN
CURRENT RELATED CAPITAL MARKETS EXECUTION.  THE AGENT MAY DETERMINE THE CAPITAL
MARKETS EXECUTION EACH BUSINESS DAY DURING THE TERM OF THE LOAN AND SHALL
PROVIDE TO THE BORROWER WRITTEN NOTICE OF ANY SUCH CAPITAL MARKETS EXECUTION
WHICH GIVES RISE TO THE BORROWER’S OBLIGATION TO MAKE A MANDATORY PREPAYMENT
PURSUANT TO THIS SECTION 3.7(C).

 

(D)                                 UPON PAYMENT OR PREPAYMENT OF THE LOAN IN
FULL, BORROWER SHALL PAY TO THE LENDERS, IN ADDITION TO THE AMOUNTS SPECIFIED IN
SECTION 3.6, SECTION 3.7 AND SECTION 3.12, AS APPLICABLE, ALL OTHER AMOUNTS THEN
DUE AND PAYABLE TO THE LENDERS PURSUANT TO THE LOAN DOCUMENTS.

 

(E)                                  NOTWITHSTANDING ANYTHING IN THIS AGREEMENT
TO THE CONTRARY, UNTIL SUCH TIME AS THE INDIVIDUAL PROPERTY KNOWN AS WACHOVIA
CENTER TOWER HAS BEEN RELEASED IN ACCORDANCE WITH THIS AGREEMENT, NO CAPITAL
EVENT SHALL BE PERMITTED UNDER SECTION 3.7(A) UNLESS, IN ADDITION TO
SATISFACTION OF THE RELEASE CONDITION, BORROWER HAS MADE A $1,200,000 PREPAYMENT
OF THE LOAN.

 

SECTION 3.8.                                   APPLICATION OF PAYMENTS AFTER
EVENT OF DEFAULT.  ALL PROCEEDS RELATING TO ANY REPAYMENTS OF THE LOAN AFTER THE
COLLATERAL AGENT SHALL HAVE RECEIVED WRITTEN NOTICE OF THE OCCURRENCE OF AN
EVENT OF DEFAULT SHALL BE APPLIED BY AGENT, IN AGENT’S SOLE DISCRETION, TO
AMOUNTS THEN OUTSTANDING UNDER THIS AGREEMENT (INCLUDING, WITHOUT LIMITATION,
ANY UNPAID FEES OF THE COLLATERAL AGENT PAYABLE PURSUANT TO THE FEE LETTER AND
ANY REASONABLE OUT-OF-POCKET COSTS AND EXPENSES OF COLLATERAL AGENT AND THE
LENDERS, IN THAT ORDER, REIMBURSABLE PURSUANT TO THE TERMS OF THIS AGREEMENT
ARISING AS A RESULT OF SUCH REPAYMENT; ANY ACCRUED AND UNPAID INTEREST THEN
PAYABLE WITH RESPECT TO THE LOAN OR THE PORTION THEREOF BEING REPAID; THE
PRINCIPAL INDEBTEDNESS OR THE PORTION THEREOF BEING REPAID; AND ANY OTHER SUMS
THEN DUE AND PAYABLE TO OR FOR THE BENEFIT OF AGENT PURSUANT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT(S)).

 

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SECTION 3.9.                                   METHOD AND PLACE OF PAYMENT FROM
THE COLLECTION ACCOUNT TO AGENT.

 

(A)                                  EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED
HEREIN, ALL PAYMENTS AND PREPAYMENTS UNDER THIS AGREEMENT AND THE NOTE SHALL BE
MADE TO AGENT NOT LATER THAN 2:00 P.M., NEW YORK CITY TIME, ON THE DATE WHEN DUE
AND SHALL BE MADE IN LAWFUL MONEY OF THE UNITED STATES OF AMERICA BY WIRE
TRANSFER IN FEDERAL OR OTHER IMMEDIATELY AVAILABLE FUNDS TO THE COLLECTION 
ACCOUNT AT LASALLE BANK NATIONAL ASSOCIATION, ABA NO. 071-000-505, ACCOUNT
NO. 720534.1, ATTENTION BRIAN GRANEY (312) 904-2047 AND AGENT SHALL DISBURSE
SUCH PAYMENTS TO THE PERSON ENTITLED THERETO ON THE BUSINESS DAY OF RECEIPT OF
SUCH PAYMENTS (OR THE NEXT BUSINESS DAY IF THE PAYMENTS ARE RECEIVED AFTER
2:00 P.M., NEW YORK CITY TIME ON SUCH BUSINESS DAY) TO THE ACCOUNT DESIGNATED BY
SUCH PERSON IN WRITING TO AGENT FROM TIME TO TIME. ANY FUNDS RECEIVED BY AGENT
AFTER SUCH TIME SHALL, FOR ALL PURPOSES HEREOF, BE DEEMED TO HAVE BEEN PAID ON
THE NEXT SUCCEEDING BUSINESS DAY. AGENT SHALL NOTIFY BORROWER IN WRITING OF ANY
CHANGES IN THE ACCOUNT TO WHICH PAYMENTS ARE TO BE MADE. ALL PAYMENTS MADE BY
BORROWER HEREUNDER, OR BY BORROWER UNDER THE OTHER LOAN DOCUMENTS, SHALL BE MADE
IRRESPECTIVE OF, AND WITHOUT ANY DEDUCTION FOR, ANY SET-OFFS OR COUNTERCLAIMS.

 

(B)                                 EXCEPT TO THE EXTENT OTHERWISE PROVIDED
HEREIN, (I) EACH PAYMENT OR PREPAYMENT OF PRINCIPAL OF THE LOAN BY BORROWER
SHALL BE MADE TO AGENT FOR THE ACCOUNT OF THE LENDERS PRO RATA IN ACCORDANCE
WITH THE RESPECTIVE UNPAID PORTION OF THE LOAN HELD BY SUCH LENDERS AND
(II) EACH PAYMENT OF INTEREST ON THE LOAN BY BORROWER SHALL BE MADE TO AGENT FOR
THE ACCOUNT OF THE LENDERS PRO RATA IN ACCORDANCE WITH THE AMOUNTS OF INTEREST
ON THE PORTION OF THE LOAN HELD BY SUCH LENDERS THEN DUE AND PAYABLE TO THE
RESPECTIVE LENDERS.

 

SECTION 3.10.                             TAXES.  ALL PAYMENTS MADE BY BORROWER
UNDER THE NOTE AND THIS AGREEMENT SHALL BE MADE FREE AND CLEAR OF, AND WITHOUT
DEDUCTION OR WITHHOLDING FOR OR ON ACCOUNT OF, ANY PRESENT OR FUTURE INCOME,
STAMP OR OTHER TAXES, LEVIES, IMPOSTS, DUTIES, CHARGES, FEES, DEDUCTIONS OR
WITHHOLDINGS, NOW OR HEREAFTER IMPOSED, LEVIED, COLLECTED, WITHHELD OR ASSESSED
BY ANY GOVERNMENTAL AUTHORITY (OTHER THAN TAXES IMPOSED ON THE INCOME OF THE
LENDERS).

 

SECTION 3.11.                             RELEASE OF COLLATERAL.

 

(A)                                  NOTWITHSTANDING ANY OTHER PROVISION OF THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, UPON THE OCCURRENCE OF A CAPITAL EVENT
WITH RESPECT TO ANY PROPERTY AS DESCRIBED IN SECTION 3.7(A) HEREOF OR A
MANDATORY PREPAYMENT OF AN ADVANCE WITH RESPECT TO ANY PROPERTY REQUIRED UNDER
SECTION 3.7(C) HEREOF, AGENT, ON BEHALF OF THE LENDERS, SHALL, SIMULTANEOUSLY
WITH SUCH CAPITAL EVENT, RELEASE OF RECORD EITHER (X) THE RELATED MEMORANDUM OF
NEGATIVE PLEDGE, IF THE RELATED MORTGAGE AND ASSIGNMENT OF RENTS AND LEASES HAVE
NOT BEEN PREVIOUSLY RECORDED OR (Y) THE LIEN OF THE RELATED MORTGAGE AND UCC-1
FINANCING STATEMENTS AND ANY OTHER LIENS IN FAVOR OF THE LENDERS RELATING TO THE
PROPERTY OR THE PORTION THEREOF AFFECTED BY SUCH CAPITAL EVENT, AND IN EITHER
SUCH EVENT, IF THE PROPERTY-OWNING BORROWER SHALL THEREUPON HAVE NO FURTHER
PROPERTY INCLUDED IN THE COLLATERAL, SHALL RELEASE THE PROPERTY-OWNING BORROWER
FROM ALL OBLIGATIONS HEREUNDER AND RELEASE THE INTERESTS IN SUCH PROPERTY-OWNING
BORROWER FROM THE PLEDGE AGREEMENT (PROPERTY-OWNING BORROWER); PROVIDED,
HOWEVER, THAT THE AGENT SHALL NOT BE

 

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REQUIRED TO RELEASE ITS LIEN UNLESS ANY PROCEEDS OF SUCH CAPITAL EVENT ARE PAID
TO AGENT IN FULL OR PARTIAL SATISFACTION OF THE INDEBTEDNESS AS AND TO THE
EXTENT REQUIRED BY SECTION 3.7(C).

 

(B)                                 IN THE EVENT BORROWER SATISFIES THE
OUTSTANDING INDEBTEDNESS IN FULL, AGENT AND, AT THE WRITTEN DIRECTION OF AGENT,
COLLATERAL AGENT SHALL WITHDRAW AND HOLD UNINVESTED FOR BORROWER IN AN ELIGIBLE
ACCOUNT AT LASALLE BANK NATIONAL ASSOCIATION FROM THE BUSINESS DAY IMMEDIATELY
PRECEDING THE DATE UPON WHICH THE RELEASE OF FUNDS IS TO BE MADE TO BORROWER AND
RELEASE ON THE DATE ON WHICH THE OUTSTANDING INDEBTEDNESS IS REPAID IN FULL ANY
AND ALL AMOUNTS THEN ON DEPOSIT IN THE RESERVE ACCOUNT AND/OR THE COLLECTION
ACCOUNT TO BORROWER. UPON REPAYMENT OF THE LOAN AND ALL OTHER AMOUNTS DUE
HEREUNDER AND UNDER THE LOAN DOCUMENTS IN FULL IN ACCORDANCE WITH THE TERMS
HEREOF AND THEREOF, THE LENDERS SHALL, PROMPTLY AFTER SUCH PAYMENT, RELEASE OR
CAUSE TO BE RELEASED ALL LIENS WITH RESPECT TO ALL COLLATERAL OR, TO THE EXTENT
NECESSARY TO FACILITATE FUTURE SAVINGS OF MORTGAGE TAX IN STATES THAT IMPOSE
MORTGAGE TAXES, ASSIGN SUCH LIENS TO BORROWER’S NEW LENDER(S), PROVIDED THAT ANY
SUCH ASSIGNMENTS SHALL BE WITHOUT RECOURSE, REPRESENTATION, OR WARRANTY OF ANY
KIND, EXCEPT THAT AGENT AND EACH LENDER SHALL REPRESENT AND WARRANT (1) THE THEN
OUTSTANDING AMOUNT OF THE PRINCIPAL INDEBTEDNESS AND (2) THAT SUCH LIENS HAVE
NOT BEEN PREVIOUSLY ASSIGNED BY AGENT OR ANY LENDER.

 

SECTION 3.12.                             CENTRAL CASH MANAGEMENT.

 

(A)                                  COLLECTION ACCOUNT; DEPOSITS TO AND
WITHDRAWALS FROM THE COLLECTION ACCOUNT.

 

(I)                                     ON OR BEFORE THE CLOSING DATE, BORROWER
SHALL ESTABLISH AND MAINTAIN WITH THE COLLATERAL AGENT A COLLECTION ACCOUNT (THE
“COLLECTION ACCOUNT”), WHICH SHALL BE AN ELIGIBLE ACCOUNT WITH A SEPARATE AND
UNIQUE IDENTIFICATION NUMBER AND ENTITLED “DEUTSCHE BANK AG, CAYMAN ISLANDS
BRANCH AS AGENT, AS SECURED PARTY FROM FIRST STATES INVESTORS DB I, L.P., FIRST
STATES INVESTORS DB I B, L.P., FIRST STATES INVESTORS 4200, LLC, FIRST STATES
INVESTORS DB I SP, L.P., AND FIRST STATES INVESTORS DB I TRS, L.P., PURSUANT TO
A AMENDED AND RESTATED LOAN AGREEMENT DATED AS OF APRIL 1, 2008 AMONG FIRST
STATES INVESTORS DB I, L.P., FIRST STATES INVESTORS DB I B, L.P., FIRST STATES
INVESTORS 4200, LLC, FIRST STATES INVESTORS DB I SP, L.P., AND FIRST STATES
INVESTORS DB I TRS, L.P., DEUTSCHE BANK AG, CAYMAN ISLANDS BRANCH AS AGENT AND
LASALLE BANK NATIONAL ASSOCIATION AS COLLATERAL AGENT.” WITH RESPECT TO EACH
ADVANCE AND THE RELATED PROPERTY, NOT LATER THAN THE RELATED ADVANCE CLOSING
DATE, BORROWER SHALL DELIVER TO EACH TENANT UNDER A LEASE AN IRREVOCABLE
DIRECTION LETTER IN A FORM APPROVED BY AGENT REQUIRING THE TENANT TO PAY ALL
RENTS AND MONEY RECEIVED FROM ACCOUNTS OR UNDER LEASES AND DERIVED FROM THE
PROPERTY AND PROCEEDS THEREOF OWED TO BORROWER DIRECTLY TO THE COLLECTION
ACCOUNT. WITHIN FOUR (4) WEEKS FOLLOWING THE RELATED ADVANCE CLOSING DATE,
BORROWER SHALL DELIVER TO AGENT, COLLATERAL AGENT AND AGENT’S COUNSEL A COPY OF
THE IRREVOCABLE DIRECTION LETTER SENT TO THE TENANT.  IN ADDITION, BORROWER
SHALL DELIVER AN IRREVOCABLE DIRECTION LETTER IN SUCH FORM TO EACH TENANT UNDER
A NEW LEASE ENTERED INTO AFTER THE DATE THEREOF PRIOR TO THE COMMENCEMENT OF
SUCH LEASE. IF A TENANT UNDER A LEASE FORWARDS SUCH RENTS, MONEY OR PROCEEDS TO
BORROWER RATHER THAN DIRECTLY TO THE COLLECTION ACCOUNT, BORROWER SHALL
(I) DELIVER AN ADDITIONAL IRREVOCABLE DIRECTION LETTER TO THE TENANT AND MAKE
OTHER COMMERCIALLY REASONABLE EFFORTS TO CAUSE THE TENANT TO FORWARD SUCH RENTS,
MONEY OR PROCEEDS DIRECTLY TO THE COLLATERAL ACCOUNT AND (II) IMMEDIATELY

 

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DEPOSIT OR CAUSE THE MANAGER TO DEPOSIT IN THE COLLECTION ACCOUNT SUCH RENTS,
MONEY OR PROCEEDS. BORROWER SHALL NOT HAVE ANY RIGHT TO WITHDRAW MONEY FROM THE
COLLECTION ACCOUNT, WHICH SHALL BE UNDER THE SOLE DOMINION AND CONTROL, AND THE
“CONTROL” WITHIN THE MEANING OF SECTIONS 9-104 AND 9-106 OF THE UCC, OF THE
AGENT. ANY SUCH RENTS, MONEY OR PROCEEDS HELD BY BORROWER OR THE MANAGER PRIOR
TO DEPOSIT INTO THE COLLECTION ACCOUNT SHALL BE HELD IN TRUST FOR THE BENEFIT OF
THE AGENT AND THE LENDERS.

 

(II)                                  WITH RESPECT TO EACH ADVANCE, COLLATERAL
AGENT SHALL ESTABLISH AND MAINTAIN INDIVIDUAL SUB-ACCOUNTS OF THE COLLECTION
ACCOUNT, EACH OF WHICH SHALL BE AN ELIGIBLE ACCOUNT, TO RECEIVE ALL RENTS AND
MONEY RECEIVED UNDER LEASES AND DERIVED FROM THE PROPERTY UNDER EACH INDIVIDUAL
PORTFOLIO OF PROPERTY WHICH IS THE SUBJECT OF AN ADVANCE (EACH A “PROPERTY
SUB-ACCOUNT” AND COLLECTIVELY, THE “PROPERTY SUB-ACCOUNTS”).  AS OF THE CLOSE OF
BUSINESS ON THE BUSINESS DAY IMMEDIATELY PRECEDING EACH PAYMENT DATE, COLLATERAL
AGENT SHALL SWEEP ALL AMOUNTS ON DEPOSIT IN EACH OF THE PROPERTY SUB-ACCOUNTS
INTO THE COLLECTION ACCOUNT TO BE DISTRIBUTED IN ACCORDANCE WITH THE PROVISIONS
OF SECTION 3.12(B) HEREOF.

 

(III)                               IN THE EVENT THAT AGENT HAS NOTIFIED THE
COLLATERAL AGENT AND BORROWER THAT AN EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING,

 

(A)                              ALL RENTS AND MONEY RECEIVED FROM ACCOUNTS OR
UNDER LEASES AND DERIVED FROM THE PROPERTY AND ALL PROCEEDS THEREOF SHALL BE
PAYABLE TO AGENT FOR THE ACCOUNT OF LENDERS OR AS OTHERWISE DIRECTED BY AGENT ON
BEHALF OF LENDERS (PROVIDED THAT SUCH DIRECTION SHALL NOT RESULT IN THE
NONPAYMENT OF ANY OUTSTANDING FEES PAYABLE TO THE COLLATERAL AGENT PURSUANT TO
THE FEE LETTER),

 

(B)                                AGENT ON BEHALF OF THE LENDERS SHALL MAKE
DEPOSITS, OR CAUSE DEPOSITS TO BE MADE, OF SUCH RENTS, MONEY AND PROCEEDS
DIRECTLY TO THE COLLECTION ACCOUNT, AND BORROWER SHALL COOPERATE (AND SHALL
CAUSE THE MANAGER TO COOPERATE) WITH AGENT ON BEHALF OF THE LENDERS IN THE
MAKING OF SUCH DEPOSITS OR CAUSING SUCH DEPOSITS TO BE MADE,

 

(C)                                BORROWER SHALL NOT HAVE ANY RIGHT TO MAKE OR
DIRECT ANY WITHDRAWALS FROM THE COLLECTION ACCOUNT OR THE RESERVE ACCOUNT
WITHOUT THE PRIOR WRITTEN CONSENT OF AGENT ON BEHALF OF THE LENDERS, AND

 

(D)                               PROCEEDS ON DEPOSIT IN THE COLLECTION ACCOUNT
AND THE RESERVE ACCOUNT MAY BE APPLIED BY COLLATERAL AGENT ON BEHALF OF THE
LENDERS FOR THE PAYMENT OF THE INDEBTEDNESS PURSUANT TO SECTION 3.8 OF THIS
AGREEMENT.

 

(IV)                              SO LONG AS NO EVENT OF DEFAULT SHALL HAVE
OCCURRED AND BE CONTINUING, BORROWER SHALL DEPOSIT IN THE COLLECTION ACCOUNT: 
(A) AS AND WHEN REQUIRED BY SECTION 3.7(B), LOSS PROCEEDS RECEIVED BY BORROWER
AND (B) SIMULTANEOUSLY WITH THE CONSUMMATION OF ANY CAPITAL EVENT AND IF
REQUIRED BY THE AGENT, THE CAPITAL EVENT PROCEEDS RESULTING FROM SUCH CAPITAL
EVENT (AND ANY CONTRIBUTIONS FROM BORROWER’S PRINCIPALS) REQUIRED IN CONNECTION
WITH SUCH CAPITAL EVENT IN ORDER TO COMPLY WITH THE RELEASE CONDITION.

 

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(B)                                 DISTRIBUTION OF CASH.  SO LONG AS THE
COLLATERAL AGENT SHALL NOT HAVE RECEIVED WRITTEN NOTICE FROM AGENT ON BEHALF OF
THE LENDERS THAT AN EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING, THE
COLLATERAL AGENT SHALL HOLD UNINVESTED FOR BORROWER OR THE LENDERS IN AN
ELIGIBLE ACCOUNT AT LASALLE BANK NATIONAL ASSOCIATION, THE FUNDS ON DEPOSIT IN
THE COLLECTION ACCOUNT AS OF THE CLOSE OF BUSINESS ON THE BUSINESS DAY
IMMEDIATELY PRECEDING EACH PAYMENT DATE TO SUCH PAYMENT DATE AND SHALL APPLY
SUCH FUNDS ON SUCH PAYMENT DATE, IN EACH CASE TO THE EXTENT OF THE AMOUNTS SET
FORTH IN THE RELATED PAYMENT DATE STATEMENT DELIVERED BY THE COLLATERAL AGENT,
AS FOLLOWS:

 

first, to the payment to the Agent of (i) the interest then due and payable on
the Note with respect to the related Interest Accrual Period and (ii) the
Principal Indebtedness in an amount equal to any additional amount to which the
Agent is then entitled pursuant to Section 3.7 of this Agreement;

 

second, to the payment to the Collateral Agent of its fees then due and payable
pursuant to the Fee Letter;

 

third, to the Real Estate Taxes Escrow Account and the Insurance Escrow Account,
in that order, in the respective amounts required to be deposited therein as
described in Section 3.13(b);

 

fourth, to the Replacement Reserve Account in the amount required to be
deposited therein as described in Section 3.13(a);

 

fifth, to the Leasing Costs/TI Costs Account in the amount required to be
deposited therein as described in Section 3.13(a);

 

sixth, Intentionally Omitted;

 

seventh, to the payment of any outstanding indemnification payment to which an
Indemnified Party is then entitled pursuant to Sections 5.1(i) and 5.1(j); and

 

eighth, to the payment of the outstanding Principal Indebtedness until the
outstanding Principal Indebtedness has been reduced by an amount equal to the
Mandatory Initial Term Amortization Amount; and

 

ninth, to Borrower in an amount equal to remaining available funds, if any.

 

(C)                                  PERMITTED INVESTMENTS.  BORROWER SHALL, OR
SHALL DIRECT COLLATERAL AGENT IN WRITING TO, INVEST AND REINVEST ANY BALANCE IN
THE COLLECTION ACCOUNT, FROM TIME TO TIME IN PERMITTED INVESTMENTS; PROVIDED,
HOWEVER, THAT

 

(I)                                     THE MATURITY OF THE PERMITTED
INVESTMENTS ON DEPOSIT THEREIN SHALL BE AT THE DISCRETION OF BORROWER, BUT IN
ANY EVENT NO LATER THAN THE BUSINESS DAY IMMEDIATELY PRECEDING THE DATE ON WHICH
SUCH FUNDS ARE REQUIRED TO BE WITHDRAWN THEREFROM PURSUANT TO SECTION 3.12(A) OR
3.12(B) OF THIS AGREEMENT,

 

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(II)                                  AFTER COLLATERAL AGENT HAS RECEIVED
WRITTEN NOTICE FROM AGENT THAT AN EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING BORROWER SHALL NOT HAVE ANY RIGHT TO DIRECT INVESTMENT OF THE BALANCE
IN THE COLLECTION ACCOUNT,

 

(III)                               ALL SUCH PERMITTED INVESTMENTS SHALL BE HELD
IN THE NAME OF COLLATERAL AGENT AND SHALL BE CREDITED TO THE COLLECTION ACCOUNT,
AND

 

(IV)                              IF NO WRITTEN INVESTMENT DIRECTION IS PROVIDED
TO COLLATERAL AGENT BY BORROWER, COLLATERAL AGENT SHALL INVEST ANY BALANCE IN
THE COLLECTION ACCOUNT IN AN INVESTMENT OF THE TYPE DESCRIBED IN CLAUSE (VII) OF
THE DEFINITION OF PERMITTED INVESTMENTS.

 

Agent, the Lenders and Collateral Agent shall have no liability for any loss in
investments of funds in the Collection Account that are invested in Permitted
Investments (unless, in the case of Collateral Agent, invested contrary to
Borrower’s or Agent’s written direction) and no such loss shall affect
Borrower’s obligation to fund, or liability for funding, the Collection Account.
All interest paid or other earnings on the Permitted Investments of funds
deposited into the Collection Account made hereunder shall be deposited into the
Collection Account. Borrower shall include all earnings on the Collection
Account as income of Borrower for federal and applicable state tax purposes.

 

(D)                                 MONTHLY AND PAYMENT DATE STATEMENTS.  WITH
RESPECT TO EACH COLLECTION PERIOD, COLLATERAL AGENT SHALL PREPARE AND DELIVER,
OR SHALL CAUSE TO BE PREPARED AND DELIVERED, TO AGENT A STATEMENT NO LATER THAN
TEN (10) BUSINESS DAYS AFTER THE END OF SUCH COLLECTION PERIOD SETTING FORTH THE
AGGREGATE DEPOSITS TO AND WITHDRAWALS FROM THE COLLECTION ACCOUNT AND EACH
ACCOUNT OF THE RESERVE ACCOUNT AND THE OPENING AND CLOSING BALANCES IN SUCH
ACCOUNTS (COLLECTIVELY, THE “MONTHLY STATEMENT”). WITH RESPECT TO EACH PAYMENT
DATE AND THE RELATED COLLECTION PERIOD AND INTEREST ACCRUAL PERIOD, COLLATERAL
AGENT SHALL PREPARE AND DELIVER, OR SHALL CAUSE TO BE PREPARED AND DELIVERED TO
BORROWER AND AGENT, A STATEMENT (EACH, A “PAYMENT DATE STATEMENT”) NO LATER THAN
THE BUSINESS DAY PRIOR TO SUCH PAYMENT DATE WITH RESPECT TO EACH OF THE ITEMS
BELOW, SETTING FORTH THE FOLLOWING:

 

(I)                                     THE AGGREGATE DEPOSITS TO THE COLLECTION
ACCOUNT DURING THE RELATED COLLECTION PERIOD FOR EACH TYPE OF DEPOSIT UNDER THIS
AGREEMENT AND THE OPENING AND CLOSING BALANCES IN THE COLLECTION ACCOUNT;

 

(II)                                  THE AMOUNT OF INTEREST THEN DUE AND
PAYABLE ON THE NOTE WITH RESPECT TO THE INTEREST ACCRUAL PERIOD (INCLUDING THE
APPLICABLE NUMBER OF DAYS AND INTEREST RATE WHICH WERE APPLIED IN DETERMINING
SUCH AMOUNT);

 

(III)                               THE AMOUNT OF THE FEES OF THE COLLATERAL
AGENT AND ANY EXPENSES PAYABLE TO THE COLLATERAL AGENT AND ANY OUTSTANDING
INDEMNIFICATION PAYMENT TO WHICH AN INDEMNIFIED PARTY IS THEN ENTITLED UNDER
THIS AGREEMENT;

 

(IV)                              THE FOLLOWING INFORMATION WITH RESPECT TO THE
PRINCIPAL INDEBTEDNESS IN A FORMAT REASONABLY ACCEPTABLE TO AGENT:  (1) THE
PRINCIPAL INDEBTEDNESS AS OF THE PRECEDING PAYMENT DATE, (2) ANY PRINCIPAL
PAYABLE TO THE LENDERS PURSUANT TO

 

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SECTIONS 3.6, 3.7 OR 3.12 ON SUCH PAYMENT DATE, AND (3) THE PRINCIPAL
INDEBTEDNESS ON THE CURRENT PAYMENT DATE (TAKING INTO ACCOUNT SUCH PAYMENTS);
AND

 

(V)                                 THE AMOUNT WITHDRAWN FROM OR REMITTED TO
EACH ACCOUNT OF THE RESERVE ACCOUNT IN ACCORDANCE WITH SECTIONS 3.12 AND 3.13
AND THE AMOUNT REMITTED TO THE BORROWER.

 

(E)                                  LOSS PROCEEDS.  IN THE EVENT OF A CASUALTY
OR TAKING WITH RESPECT TO THE PROPERTY, UNLESS PURSUANT TO SECTION 5.1(X) OF
THIS AGREEMENT OR APPLICABLE LAW, THE LOSS PROCEEDS ARE TO BE MADE AVAILABLE TO
BORROWER FOR RESTORATION OR TO THE TENANTS, ALL OF BORROWER’S INTEREST IN LOSS
PROCEEDS SHALL BE PAID DIRECTLY TO THE COLLECTION ACCOUNT TO SATISFY THE
REQUIREMENTS OF SECTION 3.7(B). IF THE LOSS PROCEEDS ARE TO BE MADE AVAILABLE
FOR RESTORATION PURSUANT TO THIS AGREEMENT OR TO THE TENANTS PURSUANT TO
APPLICABLE LAW, SUCH LOSS PROCEEDS SHALL BE HELD BY THE COLLATERAL AGENT IN A
SEGREGATED INTEREST-BEARING ELIGIBLE ACCOUNT IN THE NAME OF THE COLLATERAL AGENT
ON BEHALF OF THE LENDERS TO BE OPENED BY THE COLLATERAL AGENT WITHIN THREE
(3) BUSINESS DAYS AFTER THE COLLATERAL AGENT RECEIVES WRITTEN NOTICE OF THE
NECESSITY THEREFOR FROM THE AGENT, TO BE WITHDRAWN BY THE COLLATERAL AGENT AND
HELD UNINVESTED IN A LASALLE BANK NATIONAL ASSOCIATION ACCOUNT FROM THE BUSINESS
DAY IMMEDIATELY PRECEDING THE DATE UPON WHICH PAYMENT TO BORROWER OR TO THE
TENANTS IS TO BE MADE TO SUCH PAYMENT DATE FOR DELIVERY TO BORROWER OR TO THE
TENANTS FROM TIME TO TIME TO PAY RESTORATION COSTS PURSUANT TO A SCHEDULE
REASONABLY ACCEPTABLE TO AGENT AND BORROWER. FUNDS ON DEPOSIT IN ANY SUCH
ACCOUNT OPENED BY THE COLLATERAL AGENT SHALL BE INVESTED IN PERMITTED
INVESTMENTS IN THE SAME MANNER AND SUBJECT TO THE SAME RESTRICTIONS AS SET FORTH
IN SECTION 3.12(C) WITH RESPECT TO THE COLLECTION ACCOUNT (EXCEPT THAT THE
MATURITY SHALL BE NOT LATER THAN AS NECESSARY TO SATISFY THE SCHEDULE REFERRED
TO IN THE PRECEDING SENTENCE). IF ANY LOSS PROCEEDS ARE RECEIVED BY BORROWER,
SUCH LOSS PROCEEDS SHALL BE RECEIVED IN TRUST FOR THE LENDERS, SHALL BE
SEGREGATED FROM OTHER FUNDS OF BORROWER, AND SHALL BE FORTHWITH PAID TO
COLLATERAL AGENT TO THE EXTENT NECESSARY TO COMPLY WITH THIS AGREEMENT.

 

(F)                                    COLLATERAL AGENT’S RELIANCE.  COLLATERAL
AGENT MAY RELY AND SHALL BE PROTECTED IN ACTING OR REFRAINING FROM ACTING UPON
ANY WRITTEN NOTICE, INSTRUCTION OR REQUEST FURNISHED TO IT HEREUNDER AND
REASONABLY BELIEVED BY IT TO BE GENUINE AND TO HAVE BEEN SIGNED OR PRESENTED BY
THE PROPER PARTY OR PARTIES. COLLATERAL AGENT MAY RELY ON WRITTEN NOTICE FROM
AGENT AS TO THE OCCURRENCE AND CONTINUANCE OF AN EVENT OF DEFAULT, WITHOUT
FURTHER WRITTEN NOTICE BY THE LENDERS TO THE CONTRARY.

 

SECTION 3.13.                             RESERVE ACCOUNT.

 

(A)                                  DEFERRED MAINTENANCE ESCROW ACCOUNT,
REPLACEMENT RESERVE ACCOUNT AND LEASING COSTS/TI COSTS ACCOUNT.

 

(I)                                     ON OR BEFORE THE CLOSING DATE, BORROWER
SHALL ESTABLISH AND MAINTAIN WITH THE COLLATERAL AGENT THREE SEPARATE ACCOUNTS
FOR CAPITAL IMPROVEMENT COSTS, REPLACEMENT RESERVES, LEASING COMMISSIONS AND TI
COSTS, EACH OF WHICH SHALL BE AN ELIGIBLE ACCOUNT AND SHALL HAVE THE SAME TITLE
AS THE COLLECTION ACCOUNT, FOR THE BENEFIT OF THE LENDERS UNTIL THE LOAN IS PAID
IN FULL. THE THREE ACCOUNTS SHALL BE DESIGNATED THE DEFERRED MAINTENANCE ESCROW
ACCOUNT (THE “DEFERRED MAINTENANCE

 

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ESCROW ACCOUNT”), THE REPLACEMENT RESERVE ACCOUNT (THE “REPLACEMENT RESERVE
ACCOUNT”), AND THE LEASING COSTS/TI COSTS ACCOUNT (THE “LEASING COSTS/TI COSTS
ACCOUNT”). IF REQUIRED BY AGENT, ON ANY ADVANCE CLOSING DATE, AGENT SHALL
DEPOSIT OUT OF THE PROCEEDS OF AN ADVANCE IN THE DEFERRED MAINTENANCE ESCROW
ACCOUNT FOR THE BORROWER AN AMOUNT FOR REQUIRED CAPITAL IMPROVEMENT COSTS TO BE
INCURRED WITH RESPECT TO THE RELATED PROPERTY BEING ACQUIRED, BASED UPON THE
ENGINEERING REPORTS DELIVERED TO AGENT AND THE REASONABLE DETERMINATION OF THE
AGENT OF ANY ADDITIONAL NECESSARY AMOUNTS. ON EACH PAYMENT DATE, IF REQUIRED IN
WRITING BY THE AGENT, BORROWER SHALL INSTRUCT THE COLLATERAL AGENT IN THE
PAYMENT DATE STATEMENT TO DEPOSIT FROM THE COLLECTION ACCOUNT (OR IF THE FUNDS
FOR SUCH DEPOSIT ARE NOT AVAILABLE PURSUANT TO SECTION 3.12(B), SHALL MAKE A
DEPOSIT OF BORROWER’S FUNDS) IN THE REPLACEMENT RESERVE ACCOUNT, EQUAL TO THE
REPLACEMENT RESERVE AMOUNT AND IN THE LEASING COSTS/TI COSTS ACCOUNT, EQUAL TO
THE LEASING COSTS/TI COSTS AMOUNT.

 

(II)                                  ANY AND ALL MONEYS REMITTED TO THE
DEFERRED MAINTENANCE ESCROW ACCOUNT, TOGETHER WITH ANY PERMITTED INVESTMENTS IN
WHICH SUCH MONEYS ARE OR WILL BE INVESTED OR REINVESTED DURING THE TERM OF THIS
AGREEMENT, SHALL BE HELD IN THE DEFERRED MAINTENANCE ESCROW ACCOUNT (I) TO BE
WITHDRAWN BY COLLATERAL AGENT UPON WRITTEN REQUEST OF BORROWER MADE NOT MORE
THAN ONCE EACH MONTH IN AN AMOUNT NOT LESS THAN $5,000 AND HELD UNINVESTED FOR
BORROWER OR THE LENDERS IN AN ELIGIBLE ACCOUNT AT LASALLE BANK NATIONAL
ASSOCIATION FROM THE CLOSE OF BUSINESS ON THE BUSINESS DAY IMMEDIATELY PRECEDING
THE DATE UPON WHICH PAYMENT IS TO BE MADE TO BORROWER TO SUCH DATE, AND APPLIED
TO PAY DIRECTLY OR REIMBURSE BORROWER FOR IMMEDIATE REPAIRS CONSTITUTING CAPITAL
IMPROVEMENT COSTS REFERENCED IN THE ENGINEERING REPORTS FOR THE RELATED
PROPERTY, OR (II) FOR PURPOSES OTHERWISE REQUESTED BY BORROWER AND REASONABLY
APPROVED BY THE AGENT IN WRITING.

 

(III)                               ANY AND ALL MONEYS REMITTED TO THE
REPLACEMENT RESERVE ACCOUNT, TOGETHER WITH ANY PERMITTED INVESTMENTS IN WHICH
SUCH MONEYS ARE OR WILL BE INVESTED OR REINVESTED DURING THE TERM OF THIS
AGREEMENT, SHALL BE HELD IN THE REPLACEMENT RESERVE ACCOUNT (I) TO BE WITHDRAWN
BY COLLATERAL AGENT UPON WRITTEN REQUEST BY BORROWER MADE NOT MORE THAN ONCE
EACH MONTH IN AN AMOUNT NOT LESS THAN $5,000 AND HELD UNINVESTED FOR BORROWER OR
THE LENDERS IN AN ELIGIBLE ACCOUNT AT LASALLE BANK NATIONAL ASSOCIATION FROM THE
CLOSE OF BUSINESS ON THE BUSINESS DAY IMMEDIATELY PRECEDING THE DATE UPON WHICH
PAYMENT IS TO BE MADE TO BORROWER TO SUCH DATE, AND APPLIED TO PAY DIRECTLY OR
REIMBURSE BORROWER FOR REPLACEMENT RESERVE COSTS REASONABLY DETERMINED BY
BORROWER FOR THE PROPERTY FOR WHICH SUCH FUNDS WERE SO RESERVED OR (II) FOR
PURPOSES OTHERWISE REQUESTED BY BORROWER AND REASONABLY APPROVED BY THE AGENT IN
WRITING.

 

(IV)                              ANY AND ALL MONEYS REMITTED TO THE LEASING
COSTS/TI COSTS ACCOUNT, TOGETHER WITH ANY PERMITTED INVESTMENTS IN WHICH SUCH
MONEYS ARE OR WILL BE INVESTED OR REINVESTED DURING THE TERM OF THIS AGREEMENT,
SHALL BE HELD IN THE LEASING COSTS/TI COSTS ACCOUNT (I) TO BE WITHDRAWN BY
COLLATERAL AGENT UPON WRITTEN REQUEST BY BORROWER MADE NOT MORE THAN ONCE EACH
MONTH IN AN AMOUNT NOT LESS THAN $5,000 AND HELD UNINVESTED FOR BORROWER OR THE
LENDERS IN AN ELIGIBLE ACCOUNT AT LASALLE BANK NATIONAL ASSOCIATION FROM THE
CLOSE OF BUSINESS ON THE BUSINESS DAY IMMEDIATELY

 

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PRECEDING THE DATE UPON WHICH PAYMENT IS TO BE MADE TO BORROWER TO SUCH DATE,
AND APPLIED TO PAY DIRECTLY OR REIMBURSE BORROWER FOR LEASING COMMISSIONS AND TI
COSTS INCURRED IN CONNECTION WITH LEASING ACTIVITIES FOR THE PROPERTY FOR WHICH
SUCH FUNDS WERE SO RESERVED AFTER THE RELATED ADVANCE CLOSING DATE SPECIFIED BY
BORROWER IN A WRITTEN REQUEST DELIVERED TO COLLATERAL AGENT AND THE AGENT OR
(II) FOR PURPOSES OTHERWISE REQUESTED BY BORROWER AND REASONABLY APPROVED BY THE
AGENT IN WRITING.

 

(V)                                 NOT LESS THAN THREE (3) BUSINESS DAYS PRIOR
TO BORROWER’S DELIVERY OF A REQUEST TO COLLATERAL AGENT TO WITHDRAW THE FUNDS ON
DEPOSIT IN THE DEFERRED MAINTENANCE ESCROW ACCOUNT, REPLACEMENT RESERVE ACCOUNT
OR LEASING COSTS/TI COSTS ACCOUNT, IN WHOLE OR IN PART, BORROWER SHALL PROVIDE
THE AGENT WITH WRITTEN NOTICE (WITH A COPY TO COLLATERAL AGENT) OF SUCH REQUEST
(INCLUDING THEREIN A STATEMENT OF THE PURPOSE FOR THE WITHDRAWAL AND IN THE CASE
OF A REIMBURSEMENT OF THE BORROWER, EVIDENCE THAT THE RELATED COSTS HAVE BEEN
PAID). IN THE EVENT BORROWER COMPLETES THE REPAIRS FOR WHICH FUNDS WERE RESERVED
IN THE DEFERRED MAINTENANCE ESCROW ACCOUNT TO THE REASONABLE SATISFACTION OF THE
AGENT, AGENT AND, AT THE WRITTEN DIRECTION OF AGENT, COLLATERAL AGENT SHALL
WITHDRAW AND HOLD UNINVESTED FOR BORROWER IN AN ELIGIBLE ACCOUNT AT LASALLE BANK
NATIONAL ASSOCIATION FROM THE BUSINESS DAY IMMEDIATELY PRECEDING THE DATE UPON
WHICH THE RELEASE OF FUNDS IS TO BE MADE TO BORROWER AND RELEASE ON THE DATE OF
RELEASE ANY AND ALL AMOUNTS THEN ON DEPOSIT IN THE DEFERRED MAINTENANCE ESCROW
ACCOUNT TO THE COLLECTION ACCOUNT.

 

(B)                                 REAL ESTATE TAXES ESCROW ACCOUNT, INSURANCE
ESCROW ACCOUNT.  ON OR BEFORE THE CLOSING DATE, BORROWER SHALL ESTABLISH AND
MAINTAIN WITH THE COLLATERAL AGENT TWO SEPARATE ACCOUNTS FOR BASIC CARRYING
COSTS, EACH OF WHICH SHALL BE AN ELIGIBLE ACCOUNT AND SHALL HAVE THE SAME TITLE
AS THE COLLECTION ACCOUNT FOR THE BENEFIT OF THE LENDERS UNTIL THE LOAN IS PAID
IN FULL. THE TWO ACCOUNTS SHALL BE DESIGNATED THE REAL ESTATE TAXES ESCROW
ACCOUNT (THE “REAL ESTATE TAXES ESCROW ACCOUNT”) AND THE INSURANCE ESCROW
ACCOUNT (THE “INSURANCE ESCROW ACCOUNT”). ON EACH ADVANCE CLOSING DATE, THE
AGENT MAY DEPOSIT OUT OF THE LOAN PROCEEDS IN THE REAL ESTATE TAXES ESCROW
ACCOUNT AND IN THE INSURANCE ESCROW ACCOUNT AMOUNTS WHICH THE AGENT DEEMS
NECESSARY BASED UPON BASIC CARRYING COSTS WHICH ARE TO BECOME DUE AND PAYABLE
WITH RESPECT TO THE PROPERTY BEING ACQUIRED WITH THE PROCEEDS OF THE RELATED
ADVANCE. ON EACH PAYMENT DATE, BORROWER SHALL INSTRUCT THE COLLATERAL AGENT IN
THE PAYMENT DATE STATEMENT TO DEPOSIT FROM THE COLLECTION ACCOUNT (OR, IF THE
FUNDS FOR SUCH DEPOSIT ARE NOT AVAILABLE PURSUANT TO SECTION 3.12(B), SHALL MAKE
A DEPOSIT OF BORROWER’S FUNDS),

 

(1)                                  AN AMOUNT EQUAL TO THE IMPOSITIONS PORTION
OF MONTHLY PROPERTY EXPENSES IN THE REAL ESTATE TAXES ESCROW ACCOUNT (EXCEPT
THAT SUCH DEPOSIT SHALL NOT BE REQUIRED TO BE MADE, IF, IN CONNECTION WITH CTL
PROPERTIES ONLY, THE BORROWER DEMONSTRATES TO THE AGENT’S REASONABLE
SATISFACTION THAT A TENANT UNDER THE RELATED CREDIT LEASE IS EXPRESSLY REQUIRED
TO MAKE A SIMILAR DEPOSIT TO A RESERVE OR TO PAY SUCH IMPOSITION), AND

 

(2)                                  AN AMOUNT EQUAL TO THE PORTION OF MONTHLY
PROPERTY EXPENSES EQUAL TO INSURANCE PREMIUMS FOR POLICIES OF INSURANCE REQUIRED
TO BE MAINTAINED BY BORROWER WITH RESPECT TO THE PROPERTY PURSUANT TO THIS
AGREEMENT OR THE OTHER LOAN DOCUMENTS IN THE INSURANCE ESCROW ACCOUNT (EXCEPT
THAT SUCH DEPOSIT SHALL NOT BE

 

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REQUIRED TO BE MADE, IF, IN CONNECTION WITH CTL PROPERTIES ONLY, THE BORROWER
DEMONSTRATES TO THE AGENT’S REASONABLE SATISFACTION THAT A TENANT UNDER THE
RELATED CREDIT LEASE IS EXPRESSLY REQUIRED TO MAKE A SIMILAR DEPOSIT TO A
RESERVE OR TO PAY SUCH IMPOSITION).

 

Any and all Moneys remitted to the Real Estate Taxes Escrow Account or Insurance
Escrow Account together with any Permitted Investments in which such Moneys are
or will be invested or reinvested during the terms of this Agreement, shall be
held in the Real Estate Taxes Escrow Account or Insurance Escrow Account to be
withdrawn from the Real Estate Taxes Escrow Account or Insurance Escrow Account,
as applicable, by the Collateral Agent upon written request of Borrower
delivered to Agent and Collateral Agent together with documentation and other
evidence (including invoices and in the case of a reimbursement of the Borrower,
evidence that the related costs have been paid) with respect to the respective
Basic Carrying Costs towards which such funds are to be applied and held
uninvested for Borrower or the Lenders in an Eligible Account at LaSalle Bank
National Association from the close of business on the Business Day immediately
preceding the date upon which direct payment or reimbursement to Borrower is to
be made to such date, and applied to pay directly (or reimburse Borrower) for
(i) (x) any Impositions (in the case of the Real Estate Taxes Escrow Account) or
(y) any insurance premiums for policies of insurance required to be maintained
by Borrower with respect to the Property pursuant to this Agreement or the other
Loan Documents (in the case of the Insurance Escrow Account) shown on the
Operating Budget, in each case currently due to be paid and not previously paid
or reimbursed and (ii) any Property Expenses not shown on the Operating Budget
but reasonably approved by the Agent in writing for payment or reimbursement.
The Borrower shall deliver to the Agent tax certificates or other evidence of
tax paid promptly following payment of same in order to enable the Agent to
verify the payment of taxes.

 

(C)                                  MORTGAGE RECORDING TAX ESCROW ACCOUNT.  ON
OR BEFORE THE CLOSING DATE, BORROWER SHALL ESTABLISH AND MAINTAIN WITH THE
COLLATERAL AGENT AN ACCOUNT FOR MORTGAGE RECORDING TAXES, IF ANY, THAT WOULD BE
PAYABLE IN CONNECTION WITH A REAL ESTATE CLOSING ON THE PROPERTY WHICH IS
ACQUIRED WITH THE PROCEEDS OF EACH ADVANCE, WHICH SHALL BE AN ELIGIBLE ACCOUNT
AND SHALL HAVE THE SAME TITLE AS THE COLLECTION ACCOUNT, FOR THE BENEFIT OF THE
LENDERS UNTIL THE LOAN IS PAID IN FULL. THE ACCOUNT SHALL BE DESIGNATED THE
MORTGAGE RECORDING TAX ESCROW ACCOUNT (THE “MORTGAGE RECORDING TAX ESCROW
ACCOUNT”). IF REQUIRED BY AGENT, ON ANY ADVANCE CLOSING DATE, AGENT SHALL
DEPOSIT OUT OF THE PROCEEDS OF AN ADVANCE IN THE MORTGAGE RECORDING TAX ESCROW
ACCOUNT FOR THE BORROWER AN AMOUNT FOR REQUIRED MORTGAGE RECORDING TAXES
CALCULATED BY THE TITLE AGENT THAT SATISFY THE REQUIREMENTS OF SECTION 3.16 OF
THIS AGREEMENT SUFFICIENT TO CREATE FIRST LIENS.  ANY AND ALL MONEYS REMITTED TO
THE MORTGAGE RECORDING TAX ESCROW ACCOUNT, TOGETHER WITH ANY PERMITTED
INVESTMENTS IN WHICH SUCH MONEYS ARE OR WILL BE INVESTED OR REINVESTED DURING
THE TERM OF THIS AGREEMENT, SHALL BE HELD IN THE MORTGAGE RECORDING TAX ESCROW
ACCOUNT (I) TO BE WITHDRAWN BY COLLATERAL AGENT UPON WRITTEN REQUEST OF AGENT
FOLLOWING THE OCCURRENCE AND DURING THE CONTINUANCE OF AN EVENT OF DEFAULT AND
HELD UNINVESTED FOR BORROWER OR THE LENDERS IN AN ELIGIBLE ACCOUNT AT LASALLE
BANK NATIONAL ASSOCIATION FROM THE CLOSE OF BUSINESS ON THE BUSINESS DAY
IMMEDIATELY PRECEDING THE DATE UPON WHICH PAYMENT IS TO BE MADE TO AGENT TO SUCH
DATE, AND APPLIED TO PAY DIRECTLY OR REIMBURSE AGENT FOR MORTGAGE RECORDING
TAXES IMPOSED UPON RECORDATION OF THE MORTGAGES.

 

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(D)                                 INVESTMENT OF FUNDS.  ALL OR A PORTION OF
ANY MONEYS IN THE RESERVE ACCOUNT SHALL BE INVESTED AND REINVESTED, SO LONG AS
COLLATERAL AGENT HAS NOT RECEIVED WRITTEN NOTICE FROM AGENT THAT AN EVENT OF
DEFAULT HAS OCCURRED AND IS CONTINUING, BY COLLATERAL AGENT IN ACCORDANCE WITH
WRITTEN INSTRUCTIONS DELIVERED BY BORROWER, OR AFTER COLLATERAL AGENT HAS
RECEIVED WRITTEN NOTICE FROM AGENT THAT AN EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING, BY AGENT, IN ONE OR MORE PERMITTED INVESTMENTS. IF NO WRITTEN
INVESTMENT DIRECTION IS PROVIDED TO COLLATERAL AGENT BY BORROWER, COLLATERAL
AGENT SHALL INVEST SUCH MONEYS IN AN INVESTMENT OF THE TYPE DESCRIBED IN
CLAUSE (VII) OF THE DEFINITION OF PERMITTED INVESTMENTS. AGENT, THE LENDERS AND
COLLATERAL AGENT SHALL HAVE NO LIABILITY FOR ANY LOSS IN INVESTMENTS OF FUNDS IN
THE RESERVE ACCOUNT THAT ARE INVESTED IN PERMITTED INVESTMENTS (UNLESS, IN THE
CASE OF COLLATERAL AGENT, INVESTED CONTRARY TO BORROWER’S OR AGENT’S WRITTEN
DIRECTION) AND NO SUCH LOSS SHALL AFFECT BORROWER’S OBLIGATION TO FUND, OR
LIABILITY FOR FUNDING, THE RESERVE ACCOUNT. UNLESS AND UNTIL TITLE TO THE FUNDS
THEREIN SHALL HAVE VESTED IN ANY PERSON OTHER THAN BORROWER, BORROWER SHALL
INCLUDE ALL SUCH INCOME OR GAIN ON ANY ACCOUNT OF THE RESERVE ACCOUNT AS INCOME
OF BORROWER FOR FEDERAL AND APPLICABLE STATE TAX PURPOSES.  SO LONG AS AN EVENT
OF DEFAULT HAS NOT OCCURRED AND IS NOT CONTINUING, ALL SUCH PERMITTED
INVESTMENTS SHALL BE MADE IN THE NAME OF THE COLLATERAL AGENT ON BEHALF OF THE
LENDERS OR AS OTHERWISE DIRECTED BY AGENT.  AGENT SHALL CAUSE ALL INCOME OR
OTHER GAIN FROM INVESTMENTS OF MONEY HELD IN THE RESERVE ACCOUNT TO BE DEPOSITED
IN SUCH RESPECTIVE ACCOUNT OF THE RESERVE ACCOUNT IMMEDIATELY UPON RECEIPT AND
ANY LOSS RESULTING FROM SUCH INVESTMENTS SHALL BE CHARGED TO SUCH RESPECTIVE
ACCOUNT OF THE RESERVE ACCOUNT.

 

(E)                                  EVENT OF DEFAULT.  AFTER COLLATERAL AGENT
HAS RECEIVED WRITTEN NOTICE FROM AGENT THAT AN EVENT OF DEFAULT HAS OCCURRED AND
IS CONTINUING, BORROWER SHALL NOT BE PERMITTED TO MAKE ANY WITHDRAWAL(S) FROM
THE RESERVE ACCOUNT AND COLLATERAL AGENT AT THE WRITTEN DIRECTION OF AGENT MAY
LIQUIDATE ANY PERMITTED INVESTMENTS OF THE AMOUNT ON DEPOSIT IN SUCH ACCOUNT,
WITHDRAW AND HOLD THE PROCEEDS OF SUCH LIQUIDATION UNINVESTED FOR LENDERS IN A
LASALLE BANK NATIONAL ASSOCIATION ACCOUNT FROM THE BUSINESS DAY IMMEDIATELY
PRECEDING THE DATE SUCH FUNDS ARE TO BE USED AND USE SUCH AMOUNT ON DEPOSIT IN
THE RESERVE ACCOUNT ON THE SUCCEEDING BUSINESS DAY TO MAKE PAYMENTS ON ACCOUNT
OF THE LOAN IN ACCORDANCE WITH THE PRIORITIES SET FORTH IN SECTION 3.8.

 

SECTION 3.14.                             ADDITIONAL PROVISIONS RELATING TO THE
COLLECTION ACCOUNT AND THE RESERVE ACCOUNT.

 

(A)                                  THE COLLATERAL AGENT COVENANTS AND AGREES
THAT: (I) ALL SECURITIES OR OTHER PROPERTY UNDERLYING ANY FINANCIAL ASSETS
CREDITED TO ANY PLEDGED ACCOUNT SHALL BE REGISTERED IN THE NAME OF THE
COLLATERAL AGENT, INDORSED TO THE COLLATERAL AGENT OR INDORSED IN BLANK OR
CREDITED TO ANOTHER SECURITIES ACCOUNT MAINTAINED IN THE NAME OF THE COLLATERAL
AGENT AND IN NO CASE WILL ANY FINANCIAL ASSET CREDITED TO ANY PLEDGED ACCOUNT BE
REGISTERED IN THE NAME OF THE BORROWER, PAYABLE TO THE ORDER OF THE BORROWER OR
SPECIALLY INDORSED TO THE BORROWER EXCEPT TO THE EXTENT THE FOREGOING HAVE BEEN
SPECIALLY INDORSED TO THE COLLATERAL AGENT OR IN BLANK; AND (II) ALL PERMITTED
INVESTMENTS AND ALL OTHER PROPERTY DELIVERED TO THE COLLATERAL AGENT PURSUANT TO
THIS AGREEMENT WILL BE PROMPTLY CREDITED TO ONE OF THE PLEDGED ACCOUNTS.

 

(B)                                 THE COLLATERAL AGENT HEREBY AGREES THAT EACH
ITEM OF PROPERTY (WHETHER INVESTMENT PROPERTY, FINANCIAL ASSET, SECURITY,
INSTRUMENT, CASH OR OTHERWISE) CREDITED TO ANY

 

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PLEDGED ACCOUNT SHALL BE TREATED AS A “FINANCIAL ASSET” WITHIN THE MEANING OF
SECTION 8-102(A)(9) OF THE UCC.

 

(C)                                  IF AT ANY TIME THE COLLATERAL AGENT SHALL
RECEIVE FROM THE AGENT AN ENTITLEMENT ORDER (I.E., AN ORDER DIRECTING TRANSFER
OR REDEMPTION OF ANY FINANCIAL ASSET RELATING TO A PLEDGED ACCOUNT) OR ANY
INSTRUCTION (WITHIN THE MEANING OF SECTION 9-104 OF THE UCC) ORIGINATED BY THE
AGENT (I.E., AN INSTRUCTION DIRECTING THE DISPOSITION OF FUNDS IN A PLEDGED
ACCOUNT), THE COLLATERAL AGENT SHALL COMPLY WITH SUCH ENTITLEMENT ORDER OR
INSTRUCTION WITHOUT FURTHER CONSENT BY THE BORROWER OR ANY OTHER PERSON.

 

(D)                                 REGARDLESS OF ANY PROVISION IN ANY OTHER
AGREEMENT, FOR PURPOSES OF THE UCC, WITH RESPECT TO EACH PLEDGED ACCOUNT, NEW
YORK SHALL BE DEEMED TO BE THE BANK’S JURISDICTION (WITHIN THE MEANING OF
SECTION 9-304 OF THE UCC) AND THE SECURITIES INTERMEDIARY’S JURISDICTION (WITHIN
THE MEANING OF SECTION 8-110 OF THE UCC). THE PLEDGED ACCOUNTS SHALL BE GOVERNED
BY THE LAWS OF THE STATE OF NEW YORK.

 

(E)                                  EXCEPT FOR THE CLAIMS AND INTEREST OF THE
AGENT AND OF THE BORROWER IN THE PLEDGED ACCOUNTS, THE COLLATERAL AGENT
REPRESENTS AND WARRANTS THAT IT DOES NOT KNOW OF ANY LIEN ON OR CLAIM TO, OR
INTEREST IN, ANY PLEDGED ACCOUNT OR IN ANY “FINANCIAL ASSET” (AS DEFINED IN
SECTION 8-102(A) OF THE UCC) CREDITED THERETO. IF ANY PERSON ASSERTS ANY LIEN,
ENCUMBRANCE OR ADVERSE CLAIM (INCLUDING ANY WRIT, GARNISHMENT, JUDGMENT, WARRANT
OF ATTACHMENT, EXECUTION OR SIMILAR PROCESS) AGAINST THE PLEDGED ACCOUNTS OR IN
ANY FINANCIAL ASSET CARRIED THEREIN, THE COLLATERAL AGENT WILL PROMPTLY NOTIFY
THE AGENT AND THE BORROWER THEREOF.

 

SECTION 3.15.                             SECURITY AGREEMENT.

 

(A)                                  PLEDGE OF ACCOUNT.  TO SECURE THE FULL AND
PUNCTUAL PAYMENT AND PERFORMANCE OF ALL OF THE INDEBTEDNESS, BORROWER HEREBY
ASSIGNS, CONVEYS, PLEDGES AND TRANSFERS TO THE AGENT ON BEHALF OF THE LENDERS AS
SECURED PARTY, AND GRANTS AGENT ON BEHALF OF THE LENDERS A FIRST AND CONTINUING
SECURITY INTEREST IN AND TO, THE FOLLOWING PROPERTY, WHETHER NOW OWNED OR
EXISTING OR HEREAFTER ACQUIRED OR ARISING AND REGARDLESS OF WHERE LOCATED
(COLLECTIVELY, THE “ACCOUNT COLLATERAL”):

 

(I)                                     ALL OF BORROWER’S RIGHT, TITLE AND
INTEREST IN THE PLEDGED ACCOUNTS AND ALL MONEY AND PERMITTED INVESTMENTS, IF
ANY, FROM TIME TO TIME DEPOSITED OR HELD IN THE PLEDGED ACCOUNTS OR PURCHASED
WITH FUNDS OR ASSETS ON DEPOSIT IN THE FLEDGED ACCOUNTS;

 

(II)                                  ALL OF BORROWER’S RIGHT, TITLE AND
INTEREST IN INTEREST, DIVIDENDS, MONEY, INSTRUMENTS AND OTHER PROPERTY FROM TIME
TO TIME RECEIVED, RECEIVABLE OR OTHERWISE PAYABLE IN RESPECT OF, OR IN EXCHANGE
FOR, ANY OF THE FOREGOING UNTIL SUCH TIME AS SUCH ITEMS ARE DISBURSED FROM THE
PLEDGED ACCOUNTS; AND

 

(III)                               TO THE EXTENT NOT COVERED BY CLAUSE (I) OR
(II) ABOVE, ALL BORROWER’S RIGHT, TITLE AND INTEREST IN PROCEEDS OF ANY OR ALL
OF THE FOREGOING UNTIL SUCH TIME AS SUCH ITEMS ARE DISBURSED FROM THE PLEDGED
ACCOUNTS.

 

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(B)                                 COVENANTS.  SO LONG AS ANY PORTION OF THE
INDEBTEDNESS IS OUTSTANDING, BORROWER SHALL NOT OPEN (OR PERMIT COLLATERAL AGENT
TO OPEN) ANY ACCOUNT OTHER THAN THE COLLECTION ACCOUNT FOR THE DEPOSIT OF RENTS
OR MONEY RECEIVED FROM ACCOUNTS OR UNDER LEASES AND DERIVED FROM THE PROPERTY
AND ALL PROCEEDS TO PAY AMOUNTS OWING HEREUNDER, OTHER THAN ANY ACCOUNT FOR
AMOUNTS REQUIRED BY LAW TO BE SEGREGATED BY BORROWER. BORROWER SHALL NOT HAVE
ANY RIGHT TO WITHDRAW MONEY FROM THE RESERVE ACCOUNT, WHICH SHALL BE UNDER THE
SOLE DOMINION AND CONTROL, AND THE “CONTROL” WITHIN THE MEANING OF SECTIONS
9-104 AND 9-106 OF THE UCC, OF THE AGENT. THE ACCOUNT COLLATERAL SHALL BE
SUBJECT TO SUCH APPLICABLE LAWS, AND SUCH APPLICABLE REGULATIONS OF THE BOARD OF
GOVERNORS OF THE FEDERAL RESERVE SYSTEM AND OF ANY OTHER BANKING AUTHORITY OR
GOVERNMENTAL AUTHORITY, AS MAY NOW OR HEREAFTER BE IN EFFECT, AND TO THE RULES,
REGULATIONS AND PROCEDURES OF COLLATERAL AGENT RELATING TO DEMAND DEPOSIT
ACCOUNTS GENERALLY FROM TIME TO TIME IN EFFECT.

 

(C)                                  FINANCING STATEMENTS; FURTHER ASSURANCES. 
THE BORROWER HEREBY AUTHORIZES THE FILING OF ANY FINANCING STATEMENTS OR
CONTINUATION STATEMENTS, AND AMENDMENTS TO FINANCING STATEMENTS, IN ANY
JURISDICTIONS AND WITH ANY FILING OFFICES AS THE AGENT MAY DETERMINE, IN ITS
SOLE DISCRETION, ARE NECESSARY OR ADVISABLE TO PERFECT THE SECURITY INTEREST
GRANTED TO THE AGENT IN CONNECTION HEREWITH. SUCH FINANCING STATEMENTS MAY
DESCRIBE THE COLLATERAL IN THE SAME MANNER AS DESCRIBED IN ANY SECURITY
AGREEMENT OR PLEDGE AGREEMENT ENTERED INTO BY THE PARTIES IN CONNECTION HEREWITH
OR MAY CONTAIN AN INDICATION OR DESCRIPTION OF COLLATERAL THAT DESCRIBES SUCH
PROPERTY IN ANY OTHER MANNER AS THE AGENT MAY DETERMINE, IN ITS SOLE DISCRETION,
IS NECESSARY, ADVISABLE OR PRUDENT TO ENSURE THE PERFECTION OF THE SECURITY
INTEREST IN THE COLLATERAL GRANTED TO THE AGENT IN CONNECTION HEREWITH,
INCLUDING, WITHOUT LIMITATION, DESCRIBING SUCH PROPERTY AS “ALL ASSETS” OR “ALL
PERSONAL PROPERTY” WHETHER NOW OWNED OR HEREAFTER ACQUIRED. FROM TIME TO TIME,
AT THE EXPENSE OF BORROWER, BORROWER SHALL PROMPTLY EXECUTE AND DELIVER ALL
FURTHER INSTRUMENTS, AND TAKE ALL FURTHER ACTION, THAT AGENT MAY REASONABLY
REQUEST, IN ORDER TO CONTINUE THE PERFECTION AND PROTECTION OF THE PLEDGE AND
SECURITY INTEREST GRANTED OR PURPORTED TO BE GRANTED HEREBY.

 

(D)                                 TRANSFERS AND OTHER LIENS.  BORROWER SHALL
NOT SELL OR OTHERWISE DISPOSE OF ANY OF THE ACCOUNT COLLATERAL OTHER THAN
PURSUANT TO THE TERMS OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, OR CREATE
OR PERMIT TO EXIST ANY LIEN UPON OR WITH RESPECT TO ALL OR ANY OF THE ACCOUNT
COLLATERAL, EXCEPT FOR THE LIEN GRANTED TO AGENT, PERMITTED ENCUMBRANCES AND THE
RIGHTS OF THE INSTITUTION ACTING AS AGENT, UNDER OR AS CONTEMPLATED BY THIS
AGREEMENT.

 

(E)                                  NO WAIVER.  EVERY RIGHT AND REMEDY GRANTED
TO AGENT UNDER THIS AGREEMENT OR BY LAW MAY BE EXERCISED BY AGENT AT ANY TIME
AND FROM TIME TO TIME, AND AS OFTEN AS AGENT MAY DEEM IT EXPEDIENT. ANY AND ALL
OF AGENT’S RIGHTS WITH RESPECT TO THE PLEDGE OF AND SECURITY INTEREST IN THE
ACCOUNT COLLATERAL GRANTED HEREUNDER SHALL CONTINUE UNIMPAIRED, AND TO THE
EXTENT PERMITTED BY LAW, BORROWER SHALL BE AND REMAIN OBLIGATED IN ACCORDANCE
WITH THE TERMS HEREOF, NOTWITHSTANDING (I) ANY PROCEEDING OF BORROWER UNDER THE
UNITED STATES BANKRUPTCY CODE OR ANY BANKRUPTCY, INSOLVENCY OR REORGANIZATION
LAWS OR STATUTES OF ANY STATE, (II) THE RELEASE OR SUBSTITUTION OF ACCOUNT
COLLATERAL AT ANY TIME, OR OF ANY RIGHTS OR INTERESTS THEREIN OR (III) ANY
DELAY, EXTENSION OF TIME, RENEWAL, COMPROMISE OR OTHER INDULGENCE GRANTED BY
AGENT IN THE EVENT OF ANY DEFAULT WITH RESPECT TO THE ACCOUNT COLLATERAL OR
OTHERWISE HEREUNDER. NO DELAY OR EXTENSION OF TIME BY AGENT 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 BORROWER BY AGENT, SHALL CONSTITUTE A
WAIVER THEREOF, OR LIMIT, IMPAIR OR PREJUDICE AGENT’S RIGHT, WITHOUT

 

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NOTICE OR DEMAND, TO TAKE ANY ACTION AGAINST BORROWER OR TO EXERCISE ANY OTHER
POWER OF SALE, OPTION OR ANY OTHER RIGHT OR REMEDY.

 

(F)                                    AGENT APPOINTED ATTORNEY-IN-FACT. 
BORROWER HEREBY IRREVOCABLY CONSTITUTES AND APPOINTS AGENT AS BORROWER’S TRUE
AND LAWFUL ATTORNEY-IN-FACT, WITH FULL POWER OF SUBSTITUTION, AT ANY TIME AFTER
THE OCCURRENCE AND DURING THE CONTINUATION OF AN EVENT OF DEFAULT, TO EXECUTE,
ACKNOWLEDGE AND DELIVER ANY INSTRUMENTS AND TO EXERCISE AND ENFORCE EVERY RIGHT,
POWER, REMEDY, OPTION AND PRIVILEGE OF BORROWER WITH RESPECT TO THE ACCOUNT
COLLATERAL, AND DO IN THE NAME, PLACE AND STEAD OF BORROWER, ALL SUCH ACTS,
THINGS AND DEEDS FOR AND ON BEHALF OF AND IN THE NAME OF BORROWER WITH RESPECT
TO THE ACCOUNT COLLATERAL, WHICH BORROWER COULD OR MIGHT DO OR WHICH AGENT MAY
DEEM NECESSARY OR DESIRABLE TO MORE FULLY VEST IN AGENT THE RIGHTS AND REMEDIES
PROVIDED FOR HEREIN WITH RESPECT TO THE ACCOUNT COLLATERAL AND TO ACCOMPLISH THE
PURPOSES OF THIS AGREEMENT. THE FOREGOING POWERS OF ATTORNEY ARE IRREVOCABLE AND
COUPLED WITH AN INTEREST AND SHALL TERMINATE UPON REPAYMENT OF THE INDEBTEDNESS
IN FULL.

 

(G)                                 CONTINUING SECURITY INTEREST; TERMINATION. 
THIS SECTION 3.15 SHALL CREATE A CONTINUING PLEDGE OF AND SECURITY INTEREST IN
THE ACCOUNT COLLATERAL AND SHALL REMAIN IN FULL FORCE AND EFFECT UNTIL PAYMENT
IN FULL BY BORROWER OF THE INDEBTEDNESS. UPON PAYMENT IN FULL BY BORROWER OF THE
INDEBTEDNESS, AGENT SHALL RETURN TO BORROWER SUCH OF THE ACCOUNT COLLATERAL AS
SHALL NOT HAVE BEEN APPLIED PURSUANT TO THE TERMS HEREOF, AND SHALL EXECUTE SUCH
INSTRUMENTS AND DOCUMENTS AS MAY BE REASONABLY REQUESTED BY BORROWER TO EVIDENCE
SUCH TERMINATION AND THE RELEASE OF THE PLEDGE AND LIEN HEREOF.

 

(H)                                 RIGHT OF SET-OFF.  COLLATERAL AGENT WAIVES
ANY AND ALL RIGHTS IT MAY HAVE AT LAW OR OTHERWISE TO SET OFF OR MAKE ANY CLAIM
AGAINST THE ACCOUNT COLLATERAL, EXCEPT, WITH RESPECT TO ANY CHECKS RETURNED FOR
INSUFFICIENT FUNDS, AND THE PAYMENT OF COLLATERAL AGENT’S FEES AND EXPENSES DUE
UNDER THIS AGREEMENT (INCLUDING REASONABLE ATTORNEY FEES AND DISBURSEMENTS) FOR
THE MAINTENANCE OF THE ACCOUNT COLLATERAL.

 

SECTION 3.16.                             REAL ESTATE SECURITY DOCUMENTS;
MORTGAGE RECORDING TAXES.

 

(A)                                  IF AN EVENT OF DEFAULT HAS OCCURRED AND IS
CONTINUING, THEN THE AGENT MAY IN ITS SOLE AND ABSOLUTE DISCRETION CAUSE THE
REAL ESTATE CLOSING TO OCCUR IN WHOLE OR IN PART. ANY OUT-OF-POCKET COSTS AND
EXPENSES INCURRED BY THE AGENT IN CONNECTION THEREWITH (INCLUDING, BUT NOT
LIMITED TO, THE COSTS TO PURCHASE THE TITLE INSURANCE POLICY AND ALL STATE,
COUNTY AND MUNICIPAL RECORDING AND ALL OTHER TAXES IMPOSED UPON THE EXECUTION
AND RECORDATION OF THE MORTGAGES, IF ANY), TO THE EXTENT NOT PAID BY THE
BORROWER, SHALL BE ADDED TO THE PRINCIPAL INDEBTEDNESS AND TREATED AS AN ADVANCE
BY THE AGENT TO PROTECT ITS INTEREST IN THE COLLATERAL.

 

(B)                                 EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE, THE LIENS TO BE CREATED BY THE MORTGAGES ARE INTENDED TO ENCUMBER EACH
LEGAL PARCEL OF THE PROPERTY EITHER (X) WITH RESPECT TO EACH JURISDICTION THAT
DOES NOT IMPOSE MORTGAGE RECORDING TAXES, TO THE FULL EXTENT OF THE LOAN AMOUNT
OR (Y) WITH RESPECT TO JURISDICTIONS THAT IMPOSE MORTGAGE RECORDING TAXES, 125%
OF THE RELATED ADVANCE FOR SUCH PROPERTY. BY NOT LATER THAN FIVE (5) BUSINESS
DAYS AFTER THE AGENT SHALL HAVE NOTIFIED THE BORROWER THAT AN EVENT OF DEFAULT
SHALL HAVE OCCURRED, BORROWER SHALL HAVE PAID ALL STATE, COUNTY AND MUNICIPAL
RECORDING AND ALL OTHER TAXES IMPOSED UPON THE EXECUTION AND RECORDATION OF THE
MORTGAGES.

 

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SECTION 3.17.          TAXES.

 

(A)           ALL PAYMENTS MADE BY BORROWER UNDER THE NOTE AND THIS AGREEMENT
SHALL BE MADE FREE AND CLEAR OF, AND WITHOUT DEDUCTION OR WITHHOLDING FOR OR ON
ACCOUNT OF, ANY PRESENT OR FUTURE INCOME, STAMP OR OTHER TAXES, LEVIES, IMPOSTS,
DUTIES, CHARGES, FEES, DEDUCTIONS OR WITHHOLDINGS, NOW OR HEREAFTER IMPOSED,
LEVIED, COLLECTED, WITHHELD OR ASSESSED BY ANY GOVERNMENTAL AUTHORITY (OTHER
THAN TAXES IMPOSED ON (OR MEASURED BY) THE INCOME OF ANY LENDER AS A RESULT OF A
PRESENT OR FORMER CONNECTION BETWEEN LENDER AND THE JURISDICTION IMPOSING SUCH
TAXES EXCLUDING SUCH CONNECTION ARISING SOLELY FROM TRANSACTIONS OR PAYMENTS
CONTEMPLATED BY THIS AGREEMENT). IF ANY SUCH TAX IS REQUIRED TO BE DEDUCTED OR
WITHHELD FROM ANY PAYMENT UNDER THE NOTE OR THIS AGREEMENT, BORROWER SHALL
INCREASE THE PAYMENT TO THE EXTENT NECESSARY SO AS TO YIELD THE AMOUNT (AFTER
ALL DEDUCTIONS OR WITHHOLDINGS REQUIRED) THAT WOULD HAVE BEEN PAYABLE IF THERE
WERE NO SUCH DEDUCTION OR WITHHOLDING. IF ANY SUCH TAX IS PAYABLE BY BORROWER,
THEN, AS PROMPTLY AS POSSIBLE THEREAFTER, BORROWER SHALL SEND TO SUCH LENDER A
COPY OF AN ORIGINAL RECEIPT RECEIVED BY THE BORROWER SHOWING PAYMENT THEREOF. IF
BORROWER FAILS TO PAY ANY SUCH TAX WHEN DUE OR FAILS TO REMIT TO SUCH LENDER THE
REQUIRED RECEIPT, BORROWER SHALL INDEMNIFY SUCH LENDER FOR ANY INCREMENTAL
TAXES, INTEREST OR PENALTIES THAT MAY BECOME PAYABLE BY THE LENDER AS A RESULT
OF ANY SUCH FAILURE.

 

(B)           IF A LENDER IS NOT A UNITED STATES PERSON (AS SUCH TERM IS DEFINED
IN SECTION 7701(A)(30) OF THE CODE), THEN SUCH LENDER SHALL PROVIDE, ON OR
BEFORE SUCH LENDER BECOMES A PARTY TO THIS AGREEMENT AND AS REQUESTED BY
BORROWER THEREAFTER, AN IRS FORM W-8ECI OR W-8BEN (PLUS A NON-BANK CERTIFICATE
IN THE CASE OF A LENDER RELYING ON THE SO-CALLED “PORTFOLIO INTEREST” EXEMPTION)
CLAIMING COMPLETE EXEMPTION FROM, OR A REDUCED RATE OF, UNITED STATES
WITHHOLDING TAX ON PAYMENTS UNDER THE NOTE OR THIS AGREEMENT. NO LENDER SHALL BE
REQUIRED TO PROVIDE A FORM THAT SUCH LENDER IS NOT LEGALLY ABLE TO DELIVER. IN
ADDITION, SUCH LENDER AGREES THAT FROM TIME TO TIME, WHEN A LAPSE IN TIME OR
CHANGE IN CIRCUMSTANCES RENDERS THE PREVIOUS CERTIFICATION INVALID OR INACCURATE
IN ANY MATERIAL RESPECT, IT WILL PROMPTLY DELIVER TO BORROWER TWO NEW ACCURATE
AND COMPLETE ORIGINAL SIGNED COPIES OF INTERNAL REVENUE SERVICE FORM W-8ECI OR
W-8BEN (OR SUCCESSOR FORMS) AND SUCH OTHER FORMS AS MAY BE REQUIRED IN ORDER TO
CONFIRM OR ESTABLISH THE ENTITLEMENT OF SUCH LENDER TO A CONTINUED EXEMPTION
FROM OR REDUCTION IN UNITED STATES WITHHOLDING TAX WITH RESPECT TO PAYMENTS
UNDER THE NOTE OR THIS AGREEMENT, OR IT SHALL IMMEDIATELY NOTIFY BORROWER OF ITS
INABILITY TO DELIVER ANY SUCH FORM, IN WHICH CASE SUCH LENDER SHALL NOT BE
REQUIRED TO DELIVER ANY SUCH FORM PURSUANT TO THIS SECTION 3.17(B).
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, (X) BORROWER SHALL BE
ENTITLED, TO THE EXTENT REQUIRED TO DO SO BY LAW, TO DEDUCT OR WITHHOLD INCOME
OR SIMILAR TAXES IMPOSED BY A GOVERNMENTAL AUTHORITY FROM INTEREST, FEES OR
OTHER AMOUNTS PAYABLE HEREUNDER FOR THE ACCOUNT OF ANY SUCH LENDER TO THE EXTENT
THAT SUCH LENDER HAS NOT PROVIDED TO THE BORROWER PROPERLY COMPLETED AND
EXECUTED DOCUMENTATION THAT ESTABLISHES A COMPLETE EXEMPTION FROM SUCH DEDUCTION
OR WITHHOLDING (WHICH, WITH RESPECT TO THE UNITED STATES AND POLITICAL
SUBDIVISIONS THEREOF, SHALL BE INTERNAL REVENUE SERVICE FORMS DESCRIBED IN THIS
SECTION 3.17(B), AND, WITH RESPECT TO ANY OTHER GOVERNMENTAL AUTHORITY, SHALL BE
REQUESTED IN WRITING BY BORROWER), (Y) BORROWER SHALL NOT BE OBLIGATED TO
GROSS-UP PAYMENTS TO BE MADE TO SUCH LENDER IN RESPECT OF TAXES IMPOSED BY A
GOVERNMENTAL AUTHORITY IF SUCH LENDER HAS NOT PROVIDED TO THE BORROWER PROPERLY
COMPLETED AND EXECUTED DOCUMENTATION REASONABLY REQUESTED BY BORROWER, AS WOULD
PERMIT BORROWER TO MAKE PAYMENTS WITHOUT WITHHOLDING OR AT A REDUCED RATE,
PROVIDED

 

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THAT THE FOREGOING SHALL NOT APPLY IF SUCH LENDER IS NOT LEGALLY ABLE TO OR
ENTITLED TO DELIVER SUCH DOCUMENTATION, AND (Z) BORROWER SHALL NOT BE OBLIGATED
TO GROSS-UP PAYMENTS UNDER SECTION 3.17(A) TO BE MADE TO SUCH LENDER IN RESPECT
OF ANY TAX THAT IS IN EFFECT AND WOULD APPLY TO AMOUNTS PAYABLE TO SUCH LENDER
AT THE TIME SUCH LENDER BECOMES A PARTY TO THIS AGREEMENT, EXCEPT TO THE EXTENT
THE ASSIGNOR WITH RESPECT TO SUCH LENDER WOULD HAVE BEEN ENTITLED AT THE TIME OF
ASSIGNMENT TO RECEIVE ADDITIONAL AMOUNTS FROM BORROWER WITH RESPECT TO ANY TAX
PURSUANT TO THIS SECTION 3.17. OTHER THAN AS SET FORTH IN THIS SECTION 3.17(B),
BORROWER AGREES TO PAY ADDITIONAL AMOUNTS AS PROVIDED IN SECTION 3.17(A) AND TO
INDEMNIFY EACH LENDER AND ITS ASSIGNEES AND TRANSFEREES IN RESPECT OF ANY TAXES
DEDUCTED OR WITHHELD BY IT AS A RESULT OF ANY CHANGES THAT ARE EFFECTIVE AFTER
THE CLOSING DATE IN ANY APPLICABLE LAW, TREATY, GOVERNMENTAL RULE, REGULATION,
GUIDELINE OR OTHER, OR IN THE INTERPRETATION THEREOF, RELATING TO THE DEDUCTING
OR WITHHOLDING OF SUCH TAXES.

 

(C)           IF THE LENDER RECEIVES A REFUND IN RESPECT OF TAXES PAID BY
BORROWER WHICH REFUND IN THE JUDGMENT OF THE LENDER IS ALLOCABLE TO A PAYMENT
MADE BY BORROWER PURSUANT TO SECTION 3.13(A), THE LENDER SHALL PROMPTLY PAY SUCH
REFUND, BUT NOT OUT-OF-POCKET COSTS OF THE LENDER, TO BORROWER IF ALL OF THE
PAYMENTS DUE TO THE LENDER UNDER THIS SECTION 3.13 HAVE BEEN PAID IN FULL.

 

SECTION 3.18.          GENERAL COLLATERAL AGENT PROVISIONS.

 

(A)           APPOINTMENT.  THE LENDERS HEREBY DESIGNATE AND APPOINT LASALLE
BANK NATIONAL ASSOCIATION AS COLLATERAL AGENT ON BEHALF OF THE LENDERS UNDER
THIS AGREEMENT, AND AUTHORIZE LASALLE BANK NATIONAL ASSOCIATION, AS COLLATERAL
AGENT FOR THE LENDERS, TO TAKE SUCH ACTIONS ON THEIR BEHALF UNDER THE PROVISIONS
OF THIS AGREEMENT AND TO EXERCISE SUCH POWERS AND PERFORM SUCH DUTIES AS ARE
EXPRESSLY DELEGATED TO COLLATERAL AGENT BY THE TERMS OF THIS AGREEMENT, TOGETHER
WITH SUCH OTHER POWERS AS ARE REASONABLY INCIDENTAL THERETO. NOTWITHSTANDING ANY
PROVISION TO THE CONTRARY ELSEWHERE IN THIS AGREEMENT, COLLATERAL AGENT SHALL
NOT HAVE ANY DUTIES OR RESPONSIBILITIES, EXCEPT THOSE EXPRESSLY SET FORTH
HEREIN, OR ANY FIDUCIARY RELATIONSHIP WITH THE LENDERS, AND NO IMPLIED
COVENANTS, FUNCTIONS, RESPONSIBILITIES, DUTIES, OBLIGATIONS OR LIABILITIES SHALL
BE READ INTO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR OTHERWISE EXIST
AGAINST COLLATERAL AGENT.

 

(B)           COLLATERAL AGENT’S RIGHT TO PERFORM.  IF AN EVENT OF DEFAULT SHALL
HAVE OCCURRED AND BE CONTINUING, THEN COLLATERAL AGENT MAY, BUT SHALL HAVE NO
OBLIGATION TO, ITSELF PERFORM, OR CAUSE PERFORMANCE OF, SUCH COVENANT OR
OBLIGATION GIVING RISE TO SUCH EVENT OF DEFAULT. THE REASONABLE FEES AND
EXPENSES OF COLLATERAL AGENT INCURRED IN CONNECTION THEREWITH SHALL BE PAYABLE
BY BORROWER TO COLLATERAL AGENT UPON DEMAND, WHICH OBLIGATION SHALL BE SECURED
BY ALL COLLATERAL.

 

(C)           STANDARD OF CARE.  BEYOND THE OBSERVANCE OF ACCEPTED PRACTICES AND
THE EXERCISE OF REASONABLE CARE IN THE CUSTODY OR DISBURSEMENTS THEREOF,
COLLATERAL AGENT SHALL NOT HAVE ANY DUTY AS TO ANY ACCOUNT COLLATERAL OR ANY
INCOME THEREON IN ITS POSSESSION OR CONTROL OR IN THE POSSESSION OR CONTROL OF
ANY AGENTS FOR, OR OF COLLATERAL AGENT, OR THE PRESERVATION OF RIGHTS AGAINST
ANY PERSON OR OTHERWISE WITH RESPECT THERETO. COLLATERAL AGENT SHALL BE DEEMED
TO HAVE EXERCISED REASONABLE CARE IN THE CUSTODY OF THE ACCOUNT COLLATERAL IN
ITS POSSESSION IF THE ACCOUNT COLLATERAL IS ACCORDED TREATMENT IN ACCORDANCE
WITH THE ACCEPTED PRACTICES.

 

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(D)           EXCULPATORY PROVISIONS.  NEITHER COLLATERAL AGENT NOR ANY OF ITS
OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ATTORNEYS, ATTORNEYS-IN-FACT OR
AFFILIATES SHALL BE RESPONSIBLE IN ANY MANNER TO THE LENDERS FOR ANY RECITALS,
STATEMENTS, REPRESENTATIONS OR WARRANTIES MADE BY BORROWER OR ANY OFFICER
THEREOF CONTAINED IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR IN ANY
CERTIFICATE, REPORT, STATEMENT OR OTHER DOCUMENT REFERRED TO OR PROVIDED FOR IN,
OR RECEIVED BY COLLATERAL AGENT UNDER OR IN CONNECTION WITH, THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT OR FOR THE VALUE, VALIDITY, EFFECTIVENESS, GENUINENESS,
ENFORCEABILITY OR SUFFICIENCY OF THIS AGREEMENT, THE NOTE OR ANY OTHER LOAN
DOCUMENT OR FOR ANY FAILURE OF BORROWER TO PERFORM ITS OBLIGATIONS HEREUNDER OR
THEREUNDER. COLLATERAL AGENT SHALL NOT BE UNDER ANY OBLIGATION TO THE LENDERS TO
ASCERTAIN OR TO INQUIRE AS TO THE AGREEMENTS CONTAINED IN, OR CONDITIONS OF,
THIS LOAN AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR TO INSPECT THE PROPERTIES,
BOOKS OR RECORDS OF BORROWER. COLLATERAL AGENT SHALL NOT BE REQUIRED TO TAKE ANY
DISCRETIONARY ACTIONS HEREUNDER EXCEPT AT THE WRITTEN DIRECTION OF BORROWER OR
AGENT, IT BEING UNDERSTOOD AND AGREED THAT COLLATERAL AGENT’S DUTIES HEREUNDER
SHALL BE WHOLLY MINISTERIAL IN NATURE AND THAT COLLATERAL AGENT SHALL NOT BE
RESPONSIBLE FOR CALCULATING ANY FINANCIAL RATIOS OR GENERATING ANY REPORTS
(OTHER THAN THE MONTHLY STATEMENT) FOR THE LENDERS OR BORROWER. IN CONNECTION
WITH ANY DISCRETIONARY ACTION WHICH BORROWER IS PERMITTED HEREUNDER TO DIRECT
COLLATERAL AGENT TO TAKE, IF COLLATERAL AGENT SHALL FOLLOW AGENT’S DIRECTIONS
AND NOT BORROWER’S DIRECTIONS, IT SHALL HAVE NO LIABILITY TO BORROWER (OR TO ANY
OTHER PERSON) FOR FOLLOWING ANY SUCH DIRECTIONS OF AGENT AND FOR NOT FOLLOWING
SUCH DIRECTIONS OF BORROWER (IF EXPRESSLY PERMITTED HEREIN). COLLATERAL AGENT
SHALL NOT BE UNDER ANY OBLIGATION OR DUTY TO PERFORM ANY ACT WHICH, IN
COLLATERAL AGENT’S SOLE REASONABLE JUDGMENT, COULD INVOLVE IT IN EXPENSE OR
LIABILITY OR TO INSTITUTE OR DEFEND ANY SUIT IN RESPECT HEREOF, OR TO ADVANCE
ANY OF ITS OWN MONIES, UNLESS AGENT OR BORROWER, AS THE CASE MAY BE, SHALL HAVE
OFFERED TO COLLATERAL AGENT REASONABLE SECURITY OR INDEMNITY AGAINST SUCH
EXPENSE, LIABILITY, SUIT OR ADVANCE.

 

(E)           INDEMNIFICATION.  BORROWER SHALL INDEMNIFY AND HOLD COLLATERAL
AGENT, AND ITS AGENTS, ATTORNEYS, EMPLOYEES AND OFFICERS HARMLESS FROM AND
AGAINST ANY LOSS, COST OR DAMAGE (INCLUDING, WITHOUT LIMITATION, REASONABLE
ATTORNEYS’ FEES AND DISBURSEMENTS) INCURRED BY COLLATERAL AGENT IN CONNECTION
WITH THE TRANSACTIONS CONTEMPLATED HEREBY, EXCLUDING ANY SUCH LOSS, COST OR
DAMAGE ARISING AS A RESULT OF COLLATERAL AGENT’S FAILURE TO ADOPT AND FOLLOW
ACCEPTED PRACTICES, GROSS NEGLIGENCE, BAD FAITH, WILLFUL MISCONDUCT OR VIOLATION
OF APPLICABLE LAW. THE INDEMNIFICATION SET FORTH IN THIS PARAGRAPH SHALL SURVIVE
THE SATISFACTION AND PAYMENT OF THE INDEBTEDNESS AND THE TERMINATION OF THIS
AGREEMENT.

 

(F)            COLLATERAL AGENT’S RELIANCE.  COLLATERAL AGENT SHALL BE ENTITLED
TO RELY, AND SHALL BE FULLY PROTECTED IN RELYING, UPON ANY NOTE, WRITING,
RESOLUTION, NOTICE, CONSENT, CERTIFICATE, AFFIDAVIT, LETTER, CABLEGRAM, FAX,
ELECTRONIC MAIL MESSAGE, TELEX OR TELETYPE MESSAGE, STATEMENT, ORDER OR OTHER
DOCUMENT REASONABLY BELIEVED BY IT TO BE GENUINE AND CORRECT AND TO HAVE BEEN
SIGNED, SENT OR MADE BY THE PROPER PERSON OR PERSONS AND UPON ADVICE AND
STATEMENTS OF LEGAL COUNSEL AND OTHER EXPERTS SELECTED IN GOOD FAITH BY
COLLATERAL AGENT. COLLATERAL AGENT MAY DEEM AND TREAT THE PAYEE OF THE NOTE AS
THE OWNER THEREOF FOR ALL PURPOSES UNLESS A WRITTEN NOTICE OF ASSIGNMENT,
NEGOTIATION OR TRANSFER THEREOF SHALL HAVE BEEN FILED WITH COLLATERAL AGENT.
COLLATERAL AGENT SHALL BE FULLY JUSTIFIED IN FAILING OR REFUSING TO TAKE ANY
ACTION UNDER THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT UNLESS IT SHALL FIRST
RECEIVE SUCH ADVICE OR CONCURRENCE OF AGENT AS IT DEEMS APPROPRIATE OR IT SHALL
FIRST BE INDEMNIFIED TO ITS SATISFACTION BY AGENT AGAINST ANY AND ALL

 

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LIABILITY AND EXPENSE WHICH MAY BE INCURRED BY IT BY REASON OF TAKING OR
CONTINUING TO TAKE ANY SUCH ACTION. PROVIDED THAT COLLATERAL AGENT ACTS IN
ACCORDANCE WITH ACCEPTED PRACTICES, COLLATERAL AGENT SHALL IN ALL CASES BE FULLY
PROTECTED IN ACTING, OR IN REFRAINING FROM ACTING, UNDER THIS AGREEMENT IN
ACCORDANCE WITH A REQUEST OF AGENT, AND SUCH REQUEST AND ANY ACTION TAKEN OR
FAILURE TO ACT PURSUANT THERETO SHALL BE BINDING UPON AGENT AND ALL FUTURE
HOLDERS OF THE NOTE. ALL REQUESTS TO COLLATERAL AGENT FOR WIRE TRANSFERS OF
FUNDS, FOR TRANSFERS BETWEEN ACCOUNTS ESTABLISHED PURSUANT TO THIS AGREEMENT OR
ANY OTHER TRANSFER NOT SPECIFICALLY DESCRIBED IN THIS AGREEMENT SHALL BE IN
WRITING.

 

(G)           NOTICE OF DEFAULT.  COLLATERAL AGENT SHALL NOT BE DEEMED TO HAVE
KNOWLEDGE OR NOTICE OF THE OCCURRENCE OF ANY DEFAULT OR EVENT OF DEFAULT
HEREUNDER UNLESS COLLATERAL AGENT HAS RECEIVED WRITTEN NOTICE FROM AGENT
REFERRING TO THIS AGREEMENT, DESCRIBING SUCH DEFAULT OR EVENT OF DEFAULT AND
STATING THAT SUCH NOTICE IS A “NOTICE OF DEFAULT”. COLLATERAL AGENT SHALL TAKE
SUCH ACTION WITH RESPECT TO SUCH DEFAULT OR EVENT OF DEFAULT AS SHALL BE
DIRECTED BY AGENT, INCLUDING ANY ACTION UNDER THIS AGREEMENT.

 

(H)           NON-RELIANCE ON COLLATERAL AGENT.  NEITHER COLLATERAL AGENT NOR
ANY OF ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ATTORNEYS, ATTORNEYS-IN-FACT
OR AFFILIATES HAS MADE ANY REPRESENTATIONS OR WARRANTIES TO THE LENDERS AND NO
ACT BY COLLATERAL AGENT HEREINAFTER TAKEN (INCLUDING ANY REVIEW OF THE AFFAIRS
OF BORROWER) SHALL BE DEEMED TO CONSTITUTE ANY REPRESENTATION OR WARRANTY BY
COLLATERAL AGENT TO THE LENDERS. EXCEPT FOR NOTICES, REPORTS AND OTHER DOCUMENTS
EXPRESSLY REQUIRED TO BE FURNISHED TO AGENT BY COLLATERAL AGENT HEREUNDER,
COLLATERAL AGENT SHALL NOT HAVE ANY DUTY OR RESPONSIBILITY TO PROVIDE THE
LENDERS WITH ANY CREDIT OR OTHER INFORMATION CONCERNING THE BUSINESS,
OPERATIONS, PROPERTY, CONDITION (FINANCIAL OR OTHERWISE), PROSPECTS OR
CREDITWORTHINESS OF BORROWER WHICH MAY COME INTO THE POSSESSION OF COLLATERAL
AGENT OR ANY OF ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ATTORNEYS,
ATTORNEYS-IN-FACT OR AFFILIATES.

 

(I)            REMOVAL AND RESIGNATION.  COLLATERAL AGENT SHALL HAVE THE RIGHT
TO RESIGN AS COLLATERAL AGENT HEREUNDER AND AGENT SHALL HAVE THE RIGHT TO REMOVE
COLLATERAL AGENT AS COLLATERAL AGENT HEREUNDER, IN EACH CASE UPON THIRTY (30)
DAYS’ WRITTEN NOTICE TO THE OTHER PARTIES TO THIS AGREEMENT. IN THE EVENT OF
SUCH RESIGNATION OR REMOVAL, AGENT SHALL APPOINT A SUCCESSOR COLLATERAL AGENT,
OR AT AGENT’S OPTION IN AGENT’S SOLE AND ABSOLUTE DISCRETION AGENT MAY ASSUME
AND PERFORM THE RIGHTS AND OBLIGATIONS OF COLLATERAL AGENT. NO SUCH REMOVAL OF
OR RESIGNATION BY COLLATERAL AGENT SHALL BECOME EFFECTIVE UNTIL A SUCCESSOR
COLLATERAL AGENT SHALL HAVE ACCEPTED SUCH APPOINTMENT (OR AGENT SHALL HAVE
DETERMINED TO DESIGNATE ITSELF AS COLLATERAL AGENT) AND EXECUTED AN INSTRUMENT
BY WHICH IT SHALL HAVE ASSUMED ALL OF THE RIGHTS AND OBLIGATIONS OF COLLATERAL
AGENT HEREUNDER. IF NO SUCH SUCCESSOR COLLATERAL AGENT IS APPOINTED WITHIN SIXTY
(60) DAYS (OR, IF FEES PAYABLE UNDER THE FEE LETTER HAVE NOT BEEN PAID, THIRTY
(30) DAYS) AFTER RECEIPT OF THE RESIGNING COLLATERAL AGENT’S NOTICE OF
RESIGNATION OR REMOVAL, THE RESIGNING COLLATERAL AGENT MAY PETITION A COURT FOR
THE APPOINTMENT OF A SUCCESSOR COLLATERAL AGENT UNLESS AGENT ELECTS, IN ITS SOLE
AND ABSOLUTE DISCRETION, TO ASSUME THE RIGHTS AND OBLIGATIONS OF COLLATERAL
AGENT ITSELF. IN CONNECTION WITH ANY REMOVAL OF OR RESIGNATION BY COLLATERAL
AGENT, (A) THE REMOVED OR RESIGNING COLLATERAL AGENT SHALL (1) DULY ASSIGN,
TRANSFER AND DELIVER TO THE SUCCESSOR COLLATERAL AGENT THIS AGREEMENT AND ALL
MONEY AND PERMITTED INVESTMENTS HELD BY IT HEREUNDER, (2) EXECUTE SUCH FINANCING
STATEMENTS AND OTHER INSTRUMENTS AS MAY BE NECESSARY TO ASSIGN TO THE SUCCESSOR
COLLATERAL AGENT THE SECURITY INTEREST EXISTING IN FAVOR OF THE RETIRING
COLLATERAL AGENT HEREUNDER,

 

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AND TO OTHERWISE GIVE EFFECT TO SUCH SUCCESSION AND (3) TAKE SUCH OTHER ACTIONS
AS MAY BE REASONABLY REQUIRED BY BORROWER, AGENT OR THE SUCCESSOR COLLATERAL
AGENT IN CONNECTION WITH THE FOREGOING AND (B) THE SUCCESSOR’ COLLATERAL AGENT
SHALL ESTABLISH IN ITS NAME, AS AGENT FOR THE LENDERS, AS SECURED PARTY, THE
COLLECTION ACCOUNT AND RESERVE ACCOUNT AS BORROWER IS REQUIRED TO MAINTAIN
PURSUANT TO THE TERMS OF THIS AGREEMENT.

 

(J)            INDIVIDUAL CAPACITY.  COLLATERAL AGENT AND ITS AFFILIATES MAY
MAKE LOANS TO, ACCEPT DEPOSITS FROM AND GENERALLY ENGAGE IN ANY KIND OF BUSINESS
WITH BORROWER OR ANY AFFILIATE, AS THOUGH COLLATERAL AGENT WERE NOT COLLATERAL
AGENT HEREUNDER, OR UNDER THE OTHER LOAN DOCUMENTS.

 

SECTION 3.19.          INDEMNITY.  IF BORROWER MAKES A PREPAYMENT OF THE
ADVANCES ON ANY DAY WHICH IS NOT A PAYMENT DATE OR DEFAULTS IN MAKING A
PREPAYMENT AFTER HAVING GIVEN A NOTICE IN ACCORDANCE WITH SECTION 2.6 OF
PREPAYMENT OF ADVANCES, THE BORROWER SHALL INDEMNIFY THE LENDERS AND HOLD THE
LENDERS HARMLESS FROM ANY ACTUAL LOSS OR EXPENSE (EXCLUDING ANY LOST PROFIT OR
OPPORTUNITY COST) WHICH THE LENDERS MAY SUSTAIN OR INCUR ARISING FROM (A) THE
RE-EMPLOYMENT OF FUNDS OBTAINED BY THE LENDERS TO MAINTAIN THE ADVANCES
HEREUNDER OR (B) FEES PAYABLE TO TERMINATE THE DEPOSITS FROM WHICH SUCH FUNDS
WERE OBTAINED, IN EITHER CASE, WHICH ACTUAL LOSS OR EXPENSE SHALL BE EQUAL TO AN
AMOUNT EQUAL TO THE EXCESS, AS REASONABLY DETERMINED BY THE LENDER, OF (I) ITS
COST OF OBTAINING FUNDS FOR SUCH ADVANCES FOR THE PERIOD FROM THE DATE OF SUCH
PAYMENT THROUGH THE FOLLOWING PAYMENT DATE OVER (II) THE AMOUNT OF INTEREST
LIKELY TO BE REALIZED BY SUCH LENDER IN REDEPLOYING THE FUNDS NOT UTILIZED BY
REASON OF SUCH PAYMENT FOR SUCH PERIOD. THIS SECTION 3.19 SHALL SURVIVE
TERMINATION OF THIS LOAN AGREEMENT AND PAYMENT OF THE NOTE.

 

SECTION 3.20.          INABILITY TO DETERMINE INTEREST RATE; ILLEGALITY.

 

(A)           IF PRIOR TO THE FIRST DAY OF ANY INTEREST ACCRUAL PERIOD,
(I) LENDER SHALL HAVE DETERMINED (WHICH DETERMINATION SHALL BE CONCLUSIVE AND
BINDING UPON BORROWER) THAT, BY REASON OF CIRCUMSTANCES AFFECTING THE RELEVANT
MARKET, ADEQUATE AND REASONABLE MEANS DO NOT EXIST FOR ASCERTAINING LIBOR FOR
SUCH INTEREST ACCRUAL PERIOD, OR (II) LIBOR DETERMINED OR TO BE DETERMINED FOR
SUCH INTEREST ACCRUAL PERIOD WILL NOT ADEQUATELY AND FAIRLY REFLECT THE COST TO
SUCH LENDER (AS DETERMINED AND CERTIFIED BY SUCH LENDER) OF MAKING OR
MAINTAINING ADVANCES DURING SUCH INTEREST ACCRUAL PERIOD, SUCH LENDER SHALL GIVE
TELECOPY OR TELEPHONIC NOTICE THEREOF TO BORROWER AS SOON AS PRACTICABLE
THEREAFTER. IF SUCH NOTICE IS GIVEN, THE INTEREST RATE WITH RESPECT TO SUCH
ADVANCES FOR SUCH INTEREST ACCRUAL PERIOD, AND FOR ANY SUBSEQUENT INTEREST
ACCRUAL PERIODS UNTIL SUCH NOTICE HAS BEEN WITHDRAWN BY SUCH LENDER, SHALL BE A
PER ANNUM RATE (THE “ALTERNATIVE RATE”) EQUAL TO A RATE DETERMINED BASED ON AN
INDEX APPROXIMATING THE BEHAVIOR OF LIBOR AS REASONABLY DETERMINED BY SUCH
LENDER.

 

(B)           NOTWITHSTANDING ANY OTHER PROVISION HEREIN, IF THE ADOPTION OF OR
ANY CHANGE IN ANY LEGAL REQUIREMENT OR IN THE INTERPRETATION OR APPLICATION
THEREOF SHALL MAKE IT UNLAWFUL FOR A LENDER TO EFFECT ADVANCES AS CONTEMPLATED
BY THE LOAN DOCUMENTS, (A) THE COMMITMENT OF SUCH LENDER HEREUNDER TO MAKE NEW
ADVANCES AND TO CONTINUE ADVANCES AS SUCH SHALL FORTHWITH BE CANCELED, AND
(B) THE ADVANCES THEN OUTSTANDING SHALL BE CONVERTED AUTOMATICALLY TO
ALTERNATIVE RATE ADVANCES ON THE LAST DAY OF THE THEN CURRENT INTEREST ACCRUAL
PERIOD OR WITHIN SUCH EARLIER PERIOD AS MAY BE REQUIRED BY LAW. IF ANY SUCH
CONVERSION OF AN

 

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ADVANCE OCCURS ON A DAY WHICH IS NOT THE LAST DAY OF THE THEN CURRENT INTEREST
ACCRUAL PERIOD WITH RESPECT TO SUCH ADVANCE, BORROWER SHALL PAY TO SUCH LENDER
SUCH AMOUNTS, IF ANY, AS MAY BE REQUIRED PURSUANT TO SECTION 3.19.

 

SECTION 3.21.          REQUIREMENTS OF LAW.

 

(A)           IF THE ADOPTION OF OR ANY CHANGE IN ANY REQUIREMENT OF LAW OR IN
THE INTERPRETATION OR APPLICATION THEREOF BY ANY GOVERNMENTAL AUTHORITY OR
COMPLIANCE BY A LENDER WITH ANY DIRECTIVE FROM ANY CENTRAL BANK OR OTHER
GOVERNMENTAL AUTHORITY HAVING JURISDICTION OVER SUCH LENDER MADE SUBSEQUENT TO
THE DATE HEREOF:

 

(I)            SHALL SUBJECT SUCH LENDER TO ANY TAX OF ANY KIND WHATSOEVER WITH
RESPECT TO THE LOAN DOCUMENTS OR ANY TRANSACTION, OR CHANGE THE BASIS OF
TAXATION OF PAYMENTS TO SUCH LENDER IN RESPECT THEREOF (EXCEPT FOR CHANGES IN
THE RATE OF TAX ON SUCH LENDER’S OVERALL NET INCOME);

 

(II)           SHALL IMPOSE, MODIFY OR HOLD APPLICABLE ANY RESERVE, SPECIAL
DEPOSIT, COMPULSORY LOAN OR SIMILAR REQUIREMENT AGAINST ASSETS HELD BY, DEPOSITS
OR OTHER LIABILITIES IN OR FOR THE ACCOUNT OF, ADVANCES, LOANS OR OTHER
EXTENSIONS OF CREDIT BY, OR ANY OTHER ACQUISITION OF FUNDS BY, ANY OFFICE OF
SUCH LENDER WHICH IS NOT OTHERWISE INCLUDED IN THE DETERMINATION OF LIBOR
HEREUNDER; OR

 

(III)          SHALL IMPOSE ON SUCH LENDER ANY OTHER CONDITION;

 

and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, continuing or
maintaining Advances or to reduce any amount receivable under the Loan Documents
in respect thereof; then, in any such case, Borrower shall promptly pay such
Lender, upon its demand, any additional amounts necessary to compensate such
Lender for such increased cost or reduced amount receivable. If such Lender
becomes entitled to claim any additional amounts pursuant to this
Section 3.21(a), it shall promptly notify Borrower of the event by reason of
which it has become so entitled. As a condition to Borrower’s liability under
this paragraph, such Lender shall promptly deliver to Borrower a certificate as
to the calculation of any additional amounts payable pursuant to this subsection
and including any available supporting documentation, which certificate shall be
conclusive and binding upon Borrower in the absence of manifest error. This
covenant shall survive the termination of the Agreement and payment of the Note.

 

(B)           IF A LENDER SHALL HAVE DETERMINED THAT THE ADOPTION OF OR ANY
CHANGE IN ANY LEGAL REQUIREMENT REGARDING CAPITAL ADEQUACY OR IN THE
INTERPRETATION OR APPLICATION THEREOF OR COMPLIANCE BY SUCH LENDER OR ANY
CORPORATION CONTROLLING SUCH LENDER WITH ANY DIRECTIVE REGARDING CAPITAL
ADEQUACY FROM ANY GOVERNMENTAL AUTHORITY MADE SUBSEQUENT TO THE DATE HEREOF DOES
OR SHALL HAVE THE EFFECT OF REDUCING THE RATE OF RETURN ON SUCH LENDER’S OR SUCH
CORPORATION’S CAPITAL AS A CONSEQUENCE OF ITS OBLIGATIONS HEREUNDER TO A LEVEL
BELOW THAT WHICH SUCH LENDER OR SUCH CORPORATION COULD HAVE ACHIEVED BUT FOR
SUCH ADOPTION, CHANGE OR COMPLIANCE BY AN AMOUNT WHICH IS DEEMED BY SUCH LENDER
TO BE MATERIAL, THEN FROM TIME TO TIME, AFTER SUBMISSION BY SUCH LENDER TO
BORROWER OF A WRITTEN REQUEST THEREFORE, BORROWER SHALL PAY TO SUCH LENDER SUCH
ADDITIONAL AMOUNT OR AMOUNTS AS WILL COMPENSATE SUCH LENDER FOR SUCH

 

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REDUCTION. AS A CONDITION TO BORROWER’S LIABILITY UNDER THIS PARAGRAPH, SUCH
LENDER SHALL PROMPTLY DELIVER TO BORROWER A CERTIFICATE AS TO THE CALCULATION OF
ANY ADDITIONAL AMOUNTS PAYABLE PURSUANT TO THIS SUBSECTION AND INCLUDING ANY
AVAILABLE SUPPORTING DOCUMENTATION, WHICH CERTIFICATE SHALL BE CONCLUSIVE AND
BINDING UPON BORROWER IN THE ABSENCE OF MANIFEST ERROR. THIS COVENANT SHALL
SURVIVE THE TERMINATION OF THE AGREEMENT AND PAYMENT OF THE NOTE.

 

SECTION 3.22.          EXTENSION OPTION.

 

(A)                                  BORROWER SHALL HAVE THE OPTION (AN
“EXTENSION OPTION”), TO EXTEND THE MATURITY DATE OF THE NOTE FROM MARCH 31, 2009
(THE “ORIGINAL MATURITY DATE”), TO SEPTEMBER 30, 2009 (THE “EXTENDED MATURITY
DATE”), UPON SATISFACTION OF EACH OF THE FOLLOWING CONDITIONS (THE “EXTENSION
CONDITIONS”):

 

(I)            BORROWER SHALL HAVE GIVEN WRITTEN NOTICE (AN “EXTENSION NOTICE”)
TO AGENT AND COLLATERAL AGENT NOT LESS THAN THIRTY (30) DAYS PRIOR TO THE
ORIGINAL MATURITY DATE OF ITS ELECTION TO EXERCISE THE EXTENSION OPTION;

 

(II)           NO DEFAULT OR EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING;

 

(III)          THE OUTSTANDING PRINCIPAL INDEBTEDNESS SHALL HAVE BEEN AMORTIZED
DURING THE INITIAL TERM OF THE LOAN BY THE MANDATORY INITIAL TERM AMORTIZATION
AMOUNT; AND

 

(IV)          BORROWER SHALL HAVE PAID TO AGENT A FEE (AN “EXTENSION FEE”) EQUAL
TO $250,000 (THE PRODUCT OF 0.25% AND THE LOAN AMOUNT).

 

(B)           BORROWER MAY REVOKE ANY EXTENSION NOTICE BY WRITTEN NOTICE (OR
TELEPHONIC NOTICE PROMPTLY CONFIRMED IN WRITING) TO AGENT AND TO THE COLLATERAL
AGENT ON OR PRIOR TO THE TENTH (10TH) BUSINESS DAY PRIOR TO THE ORIGINAL
MATURITY DATE; PROVIDED, HOWEVER, THAT BORROWER SHALL PAY THE REASONABLE
OUT-OF-POCKET COSTS INCURRED BY AGENT AND COLLATERAL AGENT IN CONNECTION WITH
THE GIVING OF ANY EXTENSION NOTICE AND ITS REVOCATION.  IF THE TERM OF THE LOAN
IS EXTENDED PURSUANT TO THE PROVISIONS OF THIS SECTION 3.22, THEN ALL THE OTHER
TERMS AND CONDITIONS OF THE LOAN DOCUMENTS SHALL REMAIN IN FULL FORCE AND EFFECT
AND UNMODIFIED.

 

ARTICLE IV.
REPRESENTATIONS AND WARRANTIES

 

SECTION 4.1.            REPRESENTATIONS AND WARRANTIES AS TO BORROWER.  BORROWER
REPRESENTS AND WARRANTS THAT, AS OF THE CLOSING DATE AND AS OF EACH ADVANCE
CLOSING DATE:

 

(A)           ORGANIZATION.  EACH BORROWER, GENERAL PARTNER AND 4200 HOLDINGS
(I) IS A DULY AND SOLELY ORGANIZED AND VALIDLY EXISTING LIMITED LIABILITY
COMPANY, OR AS THE CASE MAY BE, A LIMITED PARTNERSHIP, IN GOOD STANDING UNDER
THE LAWS OF THE STATE OF DELAWARE, (II) HAS THE REQUISITE POWER AND AUTHORITY TO
OWN ITS PROPERTIES (INCLUDING, WITHOUT LIMITATION, THE PROPERTY) AND TO CARRY ON
ITS BUSINESS AS NOW BEING CONDUCTED AND IS QUALIFIED TO DO BUSINESS IN THE

 

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JURISDICTION IN WHICH THE PROPERTY IS LOCATED, AND (III) HAS THE REQUISITE POWER
TO EXECUTE AND DELIVER, AND PERFORM ITS OBLIGATIONS UNDER, THIS AGREEMENT, THE
NOTE AND ALL OF THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY.

 

(B)           AUTHORIZATION; NO CONFLICT; CONSENTS AND APPROVALS.  THE EXECUTION
AND DELIVERY BY BORROWER OF THIS AGREEMENT, THE NOTE AND EACH OF THE OTHER LOAN
DOCUMENTS, BORROWER’S PERFORMANCE OF ITS OBLIGATIONS HEREUNDER AND THEREUNDER
AND THE CREATION OF THE SECURITY INTERESTS AND LIENS PROVIDED FOR IN THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY (I) HAVE BEEN DULY
AUTHORIZED BY ALL REQUISITE ACTION ON THE PART OF BORROWER, GENERAL PARTNER AND
4200 HOLDINGS, AS APPLICABLE, (II) WILL NOT VIOLATE ANY PROVISION OF ANY LEGAL
REQUIREMENTS, ANY ORDER OF ANY COURT OR OTHER GOVERNMENTAL AUTHORITY, THE
ORGANIZATIONAL AGREEMENT OR ANY INDENTURE OR AGREEMENT OR OTHER INSTRUMENT TO
WHICH BORROWER, GENERAL PARTNER OR 4200 HOLDINGS IS A PARTY OR BY WHICH
BORROWER, GENERAL PARTNER OR 4200 HOLDINGS IS BOUND, AND (III) WILL NOT BE IN
CONFLICT WITH, RESULT IN A BREACH OF, OR CONSTITUTE (WITH DUE NOTICE OR LAPSE OF
TIME OR BOTH) A DEFAULT UNDER, OR RESULT IN THE CREATION OR IMPOSITION OF ANY
LIEN OF ANY NATURE WHATSOEVER UPON THE PROPERTY PURSUANT TO, ANY SUCH INDENTURE
OR AGREEMENT OR MATERIAL INSTRUMENT OTHER THAN THE LOAN DOCUMENTS. OTHER THAN
THOSE OBTAINED OR FILED ON OR PRIOR TO THE CLOSING DATE, NEITHER BORROWER,
GENERAL PARTNER NOR 4200 HOLDINGS ARE REQUIRED TO OBTAIN ANY CONSENT, APPROVAL
OR AUTHORIZATION FROM, OR TO FILE DECLARATION OR STATEMENT WITH, ANY
GOVERNMENTAL AUTHORITY OR OTHER AGENCY IN CONNECTION WITH OR AS A CONDITION TO
THE EXECUTION, DELIVERY OR PERFORMANCE OF THIS AGREEMENT, THE NOTE OR THE OTHER
LOAN DOCUMENTS EXECUTED AND DELIVERED BY BORROWER OR 4200 HOLDINGS.

 

(C)           ENFORCEABILITY.  THIS AGREEMENT, THE NOTE AND EACH OTHER LOAN
DOCUMENT EXECUTED BY BORROWER OR 4200 HOLDINGS IN CONNECTION WITH THE LOAN
(INCLUDING, WITHOUT LIMITATION, ANY COLLATERAL SECURITY INSTRUMENT), IS THE
LEGAL, VALID AND BINDING OBLIGATION OF BORROWER, GENERAL PARTNER AND 4200
HOLDINGS, AS APPLICABLE, ENFORCEABLE AGAINST BORROWER, GENERAL PARTNER AND 4200
HOLDINGS, AS THE CASE MAY BE, IN ACCORDANCE WITH ITS TERMS, SUBJECT TO
BANKRUPTCY, INSOLVENCY, AND OTHER LIMITATIONS ON CREDITORS’ RIGHTS GENERALLY AND
TO EQUITABLE PRINCIPLES. THIS AGREEMENT, THE NOTE AND SUCH OTHER LOAN DOCUMENTS
ARE NOT SUBJECT TO ANY RIGHT OF RESCISSION, SET-OFF, COUNTERCLAIM OR DEFENSE BY
BORROWER, GENERAL PARTNER OR 4200 HOLDINGS (INCLUDING THE DEFENSE OF USURY), AND
NONE OF BORROWER, GENERAL PARTNER OR 4200 HOLDINGS HAVE ASSERTED ANY RIGHT OF
RESCISSION, SET-OFF, COUNTERCLAIM OR DEFENSE WITH RESPECT THERETO.

 

(D)           LITIGATION.  THERE ARE NO ACTIONS, SUITS OR PROCEEDINGS AT LAW OR
IN EQUITY BY OR BEFORE ANY GOVERNMENTAL AUTHORITY OR OTHER AGENCY NOW PENDING
AND SERVED OR, TO THE BEST KNOWLEDGE OF BORROWER AND GENERAL PARTNER, THREATENED
IN WRITING AGAINST BORROWER, GENERAL PARTNER, 4200 HOLDINGS OR ANY COLLATERAL,
WHICH ACTIONS, SUITS OR PROCEEDINGS, IF DETERMINED AGAINST BORROWER, GENERAL
PARTNER, 4200 HOLDINGS OR SUCH COLLATERAL, ARE REASONABLY LIKELY TO RESULT IN A
MATERIAL ADVERSE EFFECT.

 

(E)           AGREEMENTS.  BORROWER IS NOT IN DEFAULT IN THE PERFORMANCE,
OBSERVANCE OR FULFILLMENT OF ANY OF THE OBLIGATIONS, COVENANTS OR CONDITIONS
CONTAINED IN ANY AGREEMENT OR INSTRUMENT TO WHICH IT IS A PARTY OR BY WHICH
BORROWER OR ANY COLLATERAL IS BOUND WHICH IS REASONABLY LIKELY TO HAVE A
MATERIAL ADVERSE EFFECT. BORROWER IS NOT A PARTY TO ANY AGREEMENT OR INSTRUMENT
OR SUBJECT TO ANY RESTRICTION THAT IS REASONABLY LIKELY TO HAVE A MATERIAL
ADVERSE EFFECT.

 

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(F)            NO BANKRUPTCY FILING.  NEITHER BORROWER, GENERAL PARTNER NOR 4200
HOLDINGS ARE CONTEMPLATING EITHER THE FILING OF A PETITION BY IT UNDER ANY STATE
OR FEDERAL BANKRUPTCY OR INSOLVENCY LAWS OR THE LIQUIDATION OF ALL OR A MAJOR
PORTION OF ITS ASSETS OR PROPERTY. NEITHER BORROWER, GENERAL PARTNER NOR 4200
HOLDINGS HAVE RECEIVED WRITTEN NOTICE THAT ANY PERSON IS CONTEMPLATING THE
FILING OF ANY SUCH PETITION AGAINST IT.

 

(G)           SOLVENCY.  GIVING EFFECT TO THE TRANSACTIONS CONTEMPLATED HEREBY,
THE FAIR SALEABLE VALUE OF BORROWER’S ASSETS EXCEEDS AND WILL, IMMEDIATELY
FOLLOWING THE MAKING OF THE LOAN, EXCEED BORROWER’S TOTAL LIABILITIES
(INCLUDING, WITHOUT LIMITATION, SUBORDINATED, UNLIQUIDATED, DISPUTED AND
CONTINGENT LIABILITIES). THE FAIR SALEABLE VALUE OF BORROWER’S ASSETS IS AND
WILL, IMMEDIATELY FOLLOWING THE MAKING OF THE LOAN, BE GREATER THAN BORROWER’S
PROBABLE LIABILITIES (INCLUDING THE MAXIMUM AMOUNT OF ITS CONTINGENT LIABILITIES
ON ITS DEBTS AS SUCH DEBTS BECOME ABSOLUTE AND MATURED). BORROWER’S ASSETS DO
NOT AND, IMMEDIATELY FOLLOWING THE MAKING OF THE LOAN WILL NOT, CONSTITUTE
UNREASONABLY SMALL CAPITAL TO CARRY OUT ITS BUSINESS AS CONDUCTED OR AS PROPOSED
TO BE CONDUCTED. BORROWER DOES NOT INTEND TO, AND DOES NOT BELIEVE THAT IT WILL,
INCUR DEBTS AND LIABILITIES (INCLUDING, WITHOUT LIMITATION, CONTINGENT
LIABILITIES AND OTHER COMMITMENTS) BEYOND ITS ABILITY TO PAY SUCH DEBTS AS THEY
MATURE (TAKING INTO ACCOUNT THE TIMING AND AMOUNTS TO BE PAYABLE ON OR IN
RESPECT OF OBLIGATIONS OF BORROWER).

 

(H)           OTHER DEBT.  BORROWER HAS NOT BORROWED OR RECEIVED OTHER DEBT
FINANCING WHETHER UNSECURED OR SECURED BY THE PROPERTY OR ANY PART THEREOF.

 

(I)            FULL AND ACCURATE DISCLOSURE.  NO STATEMENT OF FACT MADE BY OR ON
BEHALF OF BORROWER IN THIS AGREEMENT OR IN ANY OF THE OTHER LOAN DOCUMENTS
CONTAINS ANY UNTRUE STATEMENT OF MATERIAL FACT OR OMITS TO STATE ANY MATERIAL
FACT NECESSARY TO MAKE STATEMENTS CONTAINED HEREIN OR THEREIN NOT MISLEADING. TO
THE BEST KNOWLEDGE OF BORROWER, THERE IS NO FACT THAT HAS NOT BEEN DISCLOSED TO
AGENT THAT IS LIKELY TO RESULT IN A MATERIAL ADVERSE EFFECT.

 

(J)            FINANCIAL INFORMATION.  ALL FINANCIAL STATEMENTS AND OTHER DATA
CONCERNING BORROWER AND THE PROPERTY THAT HAS BEEN DELIVERED BY OR ON BEHALF OF
BORROWER TO AGENT IS TRUE, COMPLETE AND CORRECT IN ALL MATERIAL RESPECTS AND HAS
BEEN PREPARED IN ACCORDANCE WITH GAAP. SINCE THE DELIVERY OF SUCH DATA, EXCEPT
AS OTHERWISE DISCLOSED IN WRITING TO AGENT, THERE HAS BEEN NO CHANGE IN THE
FINANCIAL POSITION OF BORROWER OR THE PROPERTY, OR IN THE RESULTS OF OPERATIONS
OF BORROWER, WHICH CHANGE RESULTS OR IS REASONABLY LIKELY TO RESULT IN A
MATERIAL ADVERSE EFFECT. BORROWER HAS NOT INCURRED ANY OBLIGATION OR LIABILITY,
CONTINGENT OR OTHERWISE, NOT REFLECTED IN SUCH FINANCIAL DATA, WHICH IS LIKELY
TO HAVE A MATERIAL ADVERSE EFFECT UPON ITS BUSINESS OPERATIONS OR THE PROPERTY.

 

(K)           INVESTMENT COMPANY ACT.  BORROWER IS NOT (I) AN “INVESTMENT
COMPANY” OR A COMPANY “CONTROLLED” BY AN “INVESTMENT COMPANY,” WITHIN THE
MEANING OF THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED OR (II) SUBJECT TO ANY
OTHER FEDERAL OR STATE LAW OR REGULATION WHICH PURPORTS TO RESTRICT OR REGULATE
ITS ABILITY TO BORROW MONEY IN ACCORDANCE WITH THIS AGREEMENT.

 

(L)            COMPLIANCE.  BORROWER IS IN COMPLIANCE WITH ALL APPLICABLE LEGAL
REQUIREMENTS, EXCEPT FOR NONCOMPLIANCE THAT IS NOT REASONABLY LIKELY TO HAVE A
MATERIAL ADVERSE EFFECT. BORROWER IS NOT IN DEFAULT OR VIOLATION OF ANY ORDER,
WRIT, INJUNCTION, DECREE OR DEMAND OF

 

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ANY GOVERNMENTAL AUTHORITY EXCEPT FOR DEFAULTS OR VIOLATIONS WHICH ARE NOT
REASONABLY LIKELY TO HAVE A MATERIAL ADVERSE EFFECT.

 

(M)          USE OF PROCEEDS; MARGIN REGULATIONS.  BORROWER WILL USE THE
PROCEEDS OF THE LOAN FOR THE PURPOSES DESCRIBED IN SECTION 2.2. NO PART OF THE
PROCEEDS OF THE LOAN WILL BE USED FOR THE PURPOSE OF PURCHASING OR ACQUIRING ANY
“MARGIN STOCK” WITHIN THE MEANING OF REGULATION U OF THE BOARD OF GOVERNORS OF
THE FEDERAL RESERVE SYSTEM OR FOR ANY OTHER PURPOSE WHICH WOULD BE INCONSISTENT
WITH SUCH REGULATION U OR ANY OTHER REGULATIONS OF SUCH BOARD OF GOVERNORS, OR
FOR ANY PURPOSES PROHIBITED BY LEGAL REQUIREMENTS.

 

(N)           SINGLE-PURPOSE ENTITY.

 

(I)            BORROWER AT ALL TIMES SINCE ITS FORMATION HAS BEEN A DULY FORMED
AND EXISTING LIMITED LIABILITY COMPANY, OR, AS THE CASE MAY BE, LIMITED
PARTNERSHIP UNDER THE LAWS OF THE STATE OF ITS FORMATION AND A SINGLE-PURPOSE
ENTITY.

 

(II)           BORROWER AT ALL TIMES SINCE ITS FORMATION HAS COMPLIED WITH THE
PROVISIONS OF ITS ORGANIZATIONAL AGREEMENT SINCE SUCH AGREEMENT WAS EXECUTED AND
DELIVERED AND THE LAWS OF THE STATE OF DELAWARE RELATING TO LIMITED LIABILITY
COMPANIES OR, AS THE CASE MAY BE, LIMITED PARTNERSHIPS.

 

(III)          ALL CUSTOMARY FORMALITIES REGARDING THE LIMITED LIABILITY
COMPANY, OR, AS THE CASE MAY BE, LIMITED PARTNERSHIP EXISTENCE OF BORROWER HAVE
BEEN OBSERVED AT ALL TIMES SINCE THE ORGANIZATIONAL AGREEMENT WAS EXECUTED AND
DELIVERED.

 

(IV)          BORROWER HAS AT ALL TIMES SINCE IT BEGAN MAINTAINING SUCH ITEMS
ACCURATELY MAINTAINED ITS FINANCIAL STATEMENTS, ACCOUNTING RECORDS AND OTHER
LIMITED LIABILITY COMPANY, OR AS THE CASE MAY BE, A LIMITED PARTNERSHIP
DOCUMENTS SEPARATE FROM THOSE OF ITS MEMBERS, AFFILIATES OF ITS MEMBERS AND ANY
OTHER PERSON. BORROWER HAS NOT AT ANY TIME SINCE ITS FORMATION COMMINGLED ITS
ASSETS WITH THOSE OF ITS MEMBERS, ANY AFFILIATES OF ITS MEMBERS, OR ANY OTHER
PERSON. BORROWER HAS AT ALL TIMES SINCE ESTABLISHING ITS OWN BANK ACCOUNTS
ACCURATELY MAINTAINED ITS OWN BANK ACCOUNTS AND SEPARATE BOOKS OF ACCOUNT.

 

(V)           BORROWER HAS AT ALL TIMES SINCE RECEIVING FUNDS PAID ITS OWN
LIABILITIES FROM ITS OWN SEPARATE ASSETS.

 

(VI)          BORROWER HAS AT ALL TIMES SINCE ITS FORMATION IDENTIFIED ITSELF IN
ALL DEALINGS WITH THE PUBLIC, UNDER ITS OWN NAME AND AS A SEPARATE AND DISTINCT
ENTITY. BORROWER HAS NOT AT ANY TIME SINCE ITS FORMATION IDENTIFIED ITSELF AS
BEING A DIVISION OR A PART OF ANY OTHER ENTITY. BORROWER HAS NOT AT ANY TIME
SINCE ITS FORMATION IDENTIFIED ITS MEMBERS OR ANY AFFILIATES OF ITS MEMBERS AS
BEING A DIVISION OR PART OF BORROWER.

 

(VII)         BORROWER IS AS OF THE DATE HEREOF ADEQUATELY CAPITALIZED IN LIGHT
OF THE NATURE OF ITS BUSINESS.

 

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(VIII)        BORROWER HAS NOT AT ANY TIME SINCE ITS FORMATION ASSUMED OR
GUARANTEED THE LIABILITIES OF ITS MEMBERS (OR ANY PREDECESSOR CORPORATION,
PARTNERSHIP OR LIMITED LIABILITY COMPANY), ANY AFFILIATES OF ITS MEMBERS, OR ANY
OTHER PERSONS, EXCEPT FOR LIABILITIES RELATING TO THE COLLATERAL. BORROWER HAS
NOT AT ANY TIME SINCE ITS FORMATION ACQUIRED OBLIGATIONS OR SECURITIES OF ITS
MEMBERS (OR ANY PREDECESSOR CORPORATION, PARTNERSHIP OR LIMITED LIABILITY
COMPANY), OR ANY AFFILIATES OF ITS MEMBERS OR ANY OTHER PERSON. BORROWER HAS NOT
AT ANY TIME SINCE ITS FORMATION PLEDGED ITS ASSETS FOR THE BENEFIT OF ANY OTHER
ENTITY (OTHER THAN THE AGENT) OR MADE LOANS OR ADVANCES TO ITS MEMBERS (OR ANY
PREDECESSOR CORPORATION, PARTNERSHIP OR LIMITED LIABILITY COMPANY), OR ANY
AFFILIATES OF ITS MEMBERS OR ANY OTHER PERSON.

 

(IX)           BORROWER HAS NOT AT ANY TIME SINCE ITS FORMATION ENTERED INTO AND
WAS NOT A PARTY TO ANY TRANSACTION WITH ITS MEMBERS (OR ANY PREDECESSOR
CORPORATION, PARTNERSHIP OR LIMITED LIABILITY COMPANY) OR ANY AFFILIATES OF ITS
MEMBERS, EXCEPT FOR IN THE ORDINARY COURSE OF BUSINESS OF BORROWER ON TERMS
WHICH ARE NO LESS FAVORABLE TO BORROWER THAN WOULD BE OBTAINED IN A COMPARABLE
ARM’S LENGTH TRANSACTION WITH AN UNRELATED THIRD PARTY (OTHER THAN IN CONNECTION
WITH THE EXECUTION BY BORROWER AND MANAGER OF THE MANAGEMENT AGREEMENT).

 

(O)           NO DEFAULTS.  NO DEFAULT OR EVENT OF DEFAULT EXISTS UNDER OR WITH
RESPECT TO ANY LOAN DOCUMENT.

 

(P)           PLANS AND WELFARE PLANS.  THE ASSETS OF BORROWER ARE NOT TREATED
AS “PLAN ASSETS” UNDER REGULATIONS CURRENTLY PROMULGATED UNDER ERISA. EACH PLAN,
AND, TO THE BEST KNOWLEDGE OF BORROWER, EACH MULTIEMPLOYER PLAN, IS IN
COMPLIANCE IN ALL MATERIAL RESPECTS WITH, AND HAS BEEN ADMINISTERED IN ALL
MATERIAL RESPECTS IN COMPLIANCE WITH, ITS TERMS AND THE APPLICABLE PROVISIONS OF
ERISA, THE CODE AND ANY OTHER FEDERAL OR STATE LAW, AND NO EVENT OR CONDITION
HAS OCCURRED AND IS CONTINUING AS TO WHICH BORROWER WOULD BE UNDER AN OBLIGATION
TO FURNISH A REPORT TO LENDER UNDER SECTION 5.1(V)(I). OTHER THAN AN APPLICATION
FOR A FAVORABLE DETERMINATION LETTER WITH RESPECT TO A PLAN, THERE ARE NO
PENDING ISSUES OR CLAIMS BEFORE THE INTERNAL REVENUE SERVICE, THE UNITED STATES
DEPARTMENT OF LABOR OR ANY COURT OF COMPETENT JURISDICTION RELATED TO ANY PLAN
OR WELFARE PLAN. NO EVENT HAS OCCURRED, AND THERE EXISTS NO CONDITION OR SET OF
CIRCUMSTANCES, IN CONNECTION WITH ANY PLAN OR WELFARE PLAN UNDER WHICH BORROWER
OR, TO THE BEST KNOWLEDGE OF BORROWER, ANY ERISA AFFILIATE, DIRECTLY OR
INDIRECTLY (THROUGH AN INDEMNIFICATION AGREEMENT OR OTHERWISE), IS REASONABLY
LIKELY TO BE SUBJECT TO ANY MATERIAL RISK OF LIABILITY UNDER SECTION 409 OR
502(I) OF ERISA OR SECTION 4975 OF THE CODE. NO WELFARE PLAN PROVIDES OR WILL
PROVIDE BENEFITS, INCLUDING, WITHOUT LIMITATION, DEATH OR MEDICAL BENEFITS
(WHETHER OR NOT INSURED) WITH RESPECT TO ANY CURRENT OR FORMER EMPLOYEE OF
BORROWER, OR, TO THE BEST KNOWLEDGE OF BORROWER, ANY ERISA AFFILIATE BEYOND HIS
OR HER RETIREMENT OR OTHER TERMINATION OF SERVICE OTHER THAN (I) COVERAGE
MANDATED BY APPLICABLE LAW, (II) DEATH OR DISABILITY BENEFITS THAT HAVE BEEN
FULLY PROVIDED FOR BY FULLY PAID UP INSURANCE OR (III) SEVERANCE BENEFITS.

 

(Q)           ADDITIONAL BORROWER UCC INFORMATION.  BORROWERS’ ORGANIZATIONAL
IDENTIFICATION NUMBERS ARE AS IDENTIFIED IN SCHEDULE V ATTACHED HERETO AND THE
FULL LEGAL NAME OF BORROWER IS AS SET FORTH ON THE SIGNATURE PAGES HEREOF AND,
EXCEPT AS OTHERWISE DISCLOSED ON SCHEDULE VI ATTACHED HERETO, BORROWER HAS NOT
DONE IN THE LAST FIVE (5) YEARS, AND DOES NOT DO, BUSINESS UNDER ANY OTHER NAME
(INCLUDING ANY TRADE-NAME OR FICTITIOUS BUSINESS NAME).

 

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(R)            NOT FOREIGN PERSON.  BORROWER IS NOT A “FOREIGN PERSON” WITHIN
THE MEANING OF § 1445(F)(3) OF THE CODE.

 

(S)           LABOR MATTERS.  BORROWER IS NOT A PARTY TO ANY COLLECTIVE
BARGAINING AGREEMENTS.

 

(T)            PRE-CLOSING DATE ACTIVITIES.  BORROWER HAS NOT CONDUCTED ANY
BUSINESS OR OTHER ACTIVITY ON OR PRIOR TO THE CLOSING DATE, OTHER THAN IN
CONNECTION WITH THE ACQUISITION, MANAGEMENT AND OWNERSHIP OF THE PROPERTY.

 

(U)           NO BANKRUPTCIES OR CRIMINAL PROCEEDINGS INVOLVING BORROWER OR
RELATED PARTIES.  NO BANKRUPTCY, INSOLVENCY, REORGANIZATION OR COMPARABLE
PROCEEDINGS HAVE EVER BEEN INSTITUTED BY OR AGAINST BORROWER, ANY AFFILIATE OF
BORROWER, ANY GUARANTOR OR ANY INDIVIDUAL OR ENTITY OWNING, WITH HIS, HER OR ITS
FAMILY MEMBERS, 20% OR MORE OF THE DIRECT, OR INDIRECT BENEFICIAL OWNERSHIP
INTERESTS IN BORROWER (EACH SUCH GUARANTOR, INDIVIDUAL, OR ENTITY BEING HEREIN
REFERRED TO AS A “PRINCIPAL”), AND NO SUCH PROCEEDING IS NOW PENDING OR
CONTEMPLATED. NONE OF BORROWER, ANY PRINCIPAL, OR TO BORROWER’S KNOWLEDGE, ANY
OTHER INDIVIDUAL OR ENTITY DIRECTLY OR INDIRECTLY OWNING OR CONTROLLING, OR THE
FAMILY MEMBERS OF WHICH OWN OR CONTROL, ANY DIRECT OR INDIRECT BENEFICIAL
OWNERSHIP INTEREST IN BORROWER OR IN THE MANAGER OR ASSET MANAGER FOR THE
PROPERTY, HAVE BEEN CHARGED, INDICTED OR CONVICTED, OR ARE CURRENTLY UNDER THE
THREAT OF CHARGE, INDICTMENT OR CONVICTION, FOR ANY FELONY OR CRIME PUNISHABLE
BY IMPRISONMENT.

 

(V)           NO PROHIBITED PERSONS.  NEITHER BORROWER OR GUARANTOR NOR ANY OF
THEIR RESPECTIVE OFFICERS, DIRECTORS, SHAREHOLDERS, PARTNERS, MEMBERS OR
AFFILIATES, IF APPLICABLE (INCLUDING, WITHOUT LIMITATION, THE INDIRECT HOLDERS
OF EQUITY INTERESTS IN BORROWER) IS OR WILL BE AN ENTITY OR PERSON:  (I) THAT IS
LISTED IN THE ANNEX TO, OR IS OTHERWISE SUBJECT TO THE PROVISIONS OF EXECUTIVE
ORDER 13224 ISSUED ON SEPTEMBER 24, 2001 (“EO13224”); (II) WHOSE NAME APPEARS ON
THE UNITED STATES TREASURY DEPARTMENT’S OFFICE OF FOREIGN ASSETS CONTROL
(“OFAC”) MOST CURRENT LIST OF “SPECIFICALLY DESIGNATED NATIONAL AND BLOCKED
PERSONS” (WHICH LIST MAY BE PUBLISHED FROM TIME TO TIME IN VARIOUS MEDIUMS
INCLUDING, BUT NOT LIMITED TO, THE OFAC WEBSITE,
HTTP:WWW.TREAS.GOV/OFAC/T11SDN.PDF); (III) WHO COMMITS, THREATENS TO COMMIT OR
SUPPORTS “TERRORISM”, AS THAT TERM IS DEFINED IN EO13224; OR (IV) WHO IS
OTHERWISE AFFILIATED WITH ANY ENTITY OR PERSON LISTED ABOVE (ANY AND ALL PARTIES
OR PERSONS DESCRIBED IN CLAUSES (I) THROUGH (IV) ABOVE ARE HEREIN REFERRED TO AS
A “PROHIBITED PERSON”).  BORROWER, GUARANTOR AND THEIR RESPECTIVE AFFILIATES ARE
IN FULL COMPLIANCE WITH ALL APPLICABLE ORDERS, RULES, REGULATIONS AND
RECOMMENDATIONS OF THE OFFICE OF FOREIGN ASSETS CONTROL OF THE U.S. DEPARTMENT
OF THE TREASURY.

 

(W)          EMBARGOED PERSON.  AS OF THE DATE HEREOF AND AT ALL TIMES
THROUGHOUT THE TERM OF THE LOAN, INCLUDING AFTER GIVING EFFECT TO ANY TRANSFERS
PERMITTED PURSUANT TO THE LOAN AGREEMENT, (A) NONE OF THE FUNDS OR OTHER ASSETS
OF BORROWER AND GUARANTOR CONSTITUTE PROPERTY OF, OR ARE BENEFICIALLY OWNED,
DIRECTLY OR INDIRECTLY, BY ANY PERSON, ENTITY OR GOVERNMENT SUBJECT TO TRADE
RESTRICTIONS UNDER U.S. LAW, INCLUDING BUT NOT LIMITED TO, THE INTERNATIONAL
EMERGENCY ECONOMIC POWERS ACT, 50 U.S.C. §§ 1701 ET SEQ., THE TRADING WITH THE
ENEMY ACT, 50 U.S.C. APP. 1 ET SEQ., AND ANY EXECUTIVE ORDERS OR REGULATIONS
PROMULGATED THEREUNDER WITH THE RESULT THAT THE INVESTMENT IN BORROWER OR
GUARANTOR, AS APPLICABLE (WHETHER DIRECTLY OR INDIRECTLY), IS PROHIBITED BY LAW
OR THE LOAN MADE BY AGENT IS IN VIOLATION OF LAW (“EMBARGOED PERSON”);

 

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(B) NO EMBARGOED PERSON HAS ANY INTEREST OF ANY NATURE WHATSOEVER IN BORROWER OR
GUARANTOR, AS APPLICABLE, WITH THE RESULT THAT THE INVESTMENT IN BORROWER OR
GUARANTOR, AS APPLICABLE (WHETHER DIRECTLY OR INDIRECTLY), IS PROHIBITED BY LAW
OR THE LOAN IS IN VIOLATION OF LAW; AND (C) NONE OF THE FUNDS OF BORROWER OR
GUARANTOR, AS APPLICABLE, HAVE BEEN DERIVED FROM ANY UNLAWFUL ACTIVITY WITH THE
RESULT THAT THE INVESTMENT IN BORROWER OR GUARANTOR, AS APPLICABLE (WHETHER
DIRECTLY OR INDIRECTLY), IS PROHIBITED BY LAW OR THE LOAN IS IN VIOLATION OF
LAW.

 

SECTION 4.2.            REPRESENTATIONS AND WARRANTIES AS TO EACH PROPERTY. 
BORROWER HEREBY REPRESENTS AND WARRANTS TO THE AGENT THAT, AS TO ALL PROPERTY,
AS OF EACH ADVANCE CLOSING DATE, EXCEPT AS OTHERWISE DISCLOSED TO AGENT ON
SCHEDULE VI HERETO:

 

(A)           TITLE TO THE PROPERTY.  BORROWER OWNS GOOD, MARKETABLE AND
INSURABLE FEE SIMPLE TITLE TO THE APPLICABLE LAND, FREE AND CLEAR OF ALL LIENS,
OTHER THAN THE PERMITTED ENCUMBRANCES APPLICABLE TO THE LAND. BORROWER OWNS THE
OTHER PROPERTY FREE AND CLEAR OF ANY AND ALL LIENS, OTHER THAN PERMITTED
ENCUMBRANCES. THERE ARE NO OUTSTANDING OPTIONS TO PURCHASE OR RIGHTS OF FIRST
REFUSAL OR RESTRICTIONS ON TRANSFERABILITY AFFECTING SUCH PROPERTY.

 

(B)           UTILITIES AND PUBLIC ACCESS.  TO THE BEST OF BORROWER’S KNOWLEDGE,
THE PROPERTY HAS ADEQUATE RIGHTS OF ACCESS TO PUBLIC WAYS AND IS SERVED BY
WATER, ELECTRIC, SEWER, SANITARY SEWER AND STORM DRAIN FACILITIES. ALL PUBLIC
UTILITIES NECESSARY TO THE CONTINUED USE AND ENJOYMENT OF THE PROPERTY AS
PRESENTLY USED AND ENJOYED ARE LOCATED IN THE PUBLIC RIGHT-OF-WAY ABUTTING THE
PREMISES, AND ALL SUCH UTILITIES ARE CONNECTED SO AS TO SERVE THE PROPERTY
WITHOUT PASSING OVER OTHER PROPERTY EXCEPT FOR LAND OR EASEMENT AREAS OF OR
AVAILABLE TO THE UTILITY COMPANY PROVIDING SUCH UTILITY SERVICE. ALL ROADS
NECESSARY FOR THE FULL UTILIZATION OF THE PROPERTY FOR ITS CURRENT PURPOSE HAVE
BEEN COMPLETED AND DEDICATED TO PUBLIC USE AND ACCEPTED BY ALL GOVERNMENTAL
AUTHORITIES OR ARE THE SUBJECT OF ACCESS EASEMENTS FOR THE BENEFIT OF THE
PROPERTY.

 

(C)           CONDEMNATION.  NO TAKING HAS BEEN COMMENCED NOR HAS BORROWER
RECEIVED WRITTEN NOTICE OF A TAKING, WITH RESPECT TO ALL OR ANY PORTION OF THE
PROPERTY OR FOR THE RELOCATION OF ROADWAYS PROVIDING ACCESS TO THE PROPERTY.

 

(D)           COMPLIANCE.  THE PROPERTY IS IN COMPLIANCE WITH ALL APPLICABLE
LEGAL REQUIREMENTS (INCLUDING, WITHOUT LIMITATION, BUILDING AND ZONING
ORDINANCES AND CODES) AND ALL APPLICABLE INSURANCE REQUIREMENTS, EXCEPT FOR
NONCOMPLIANCE WHICH IS NOT REASONABLY LIKELY TO HAVE A MATERIAL ADVERSE EFFECT.

 

(E)           ENVIRONMENTAL COMPLIANCE.  EXCEPT FOR MATTERS SET FORTH IN THE
ENVIRONMENTAL REPORTS DELIVERED TO AGENT IN CONNECTION WITH THE LOAN (TRUE,
CORRECT AND COMPLETE COPIES OF WHICH HAVE BEEN PROVIDED TO AGENT BY BORROWER):

 

(I)            BORROWER IS IN FULL COMPLIANCE WITH ALL APPLICABLE ENVIRONMENTAL
LAWS WITH RESPECT TO THE PROPERTY (WHICH COMPLIANCE INCLUDES, BUT IS NOT LIMITED
TO, THE POSSESSION BY BORROWER OR THE MANAGER OF ALL ENVIRONMENTAL, HEALTH AND
SAFETY PERMITS, LICENSES AND OTHER GOVERNMENTAL AUTHORIZATIONS REQUIRED IN
CONNECTION WITH THE OWNERSHIP AND OPERATION OF THE PROPERTY UNDER ALL
ENVIRONMENTAL LAWS), EXCEPT FOR NONCOMPLIANCE WHICH IS NOT REASONABLY LIKELY TO
HAVE A MATERIAL ADVERSE EFFECT.

 

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(II)           THERE IS NO ENVIRONMENTAL CLAIM PENDING OR, TO THE ACTUAL
KNOWLEDGE OF BORROWER, THREATENED, AND NO PENALTIES ARISING UNDER ENVIRONMENTAL
LAWS HAVE BEEN ASSESSED, AGAINST BORROWER OR THE MANAGER WITH RESPECT TO THE
PROPERTY OR, TO THE ACTUAL KNOWLEDGE OF BORROWER, AGAINST ANY PERSON WITH
RESPECT TO THE PROPERTY WHOSE LIABILITY FOR ANY ENVIRONMENTAL CLAIM BORROWER OR
THE MANAGER HAS OR MAY HAVE RETAINED OR ASSUMED EITHER CONTRACTUALLY OR BY
OPERATION OF LAW, AND NO INVESTIGATION OR REVIEW IS PENDING OR, TO THE ACTUAL
KNOWLEDGE OF BORROWER, THREATENED BY ANY GOVERNMENTAL AUTHORITY, CITIZENS GROUP,
EMPLOYEE OR OTHER PERSON WITH RESPECT TO ANY ALLEGED FAILURE BY BORROWER OR THE
MANAGER OR THE PROPERTY TO HAVE ANY ENVIRONMENTAL, HEALTH OR SAFETY PERMIT,
LICENSE OR OTHER AUTHORIZATION REQUIRED UNDER, OR TO OTHERWISE COMPLY WITH, ANY
ENVIRONMENTAL LAW OR WITH RESPECT TO ANY ALLEGED LIABILITY OF BORROWER OR THE
MANAGER FOR ANY USE OR RELEASE OF ANY HAZARDOUS SUBSTANCES.

 

(III)          THERE ARE NO PRESENT AND, TO THE ACTUAL KNOWLEDGE OF THE
BORROWER, THERE HAVE BEEN NO PAST RELEASES OF ANY HAZARDOUS SUBSTANCE AT, ON,
IN, UNDER OR FROM THE PROPERTY THAT ARE REASONABLY LIKELY TO FORM THE BASIS OF
ANY ENVIRONMENTAL CLAIM AGAINST BORROWER, THE MANAGER OR AGAINST ANY PERSON
WHOSE LIABILITY FOR ANY ENVIRONMENTAL CLAIM BORROWER OR THE MANAGER HAS OR MAY
HAVE RETAINED OR ASSUMED EITHER CONTRACTUALLY OR BY OPERATION OF LAW.

 

(IV)          WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, THERE IS NOT
PRESENT AT, ON, IN OR UNDER THE PROPERTY, PCB-CONTAINING EQUIPMENT, ASBESTOS OR
ASBESTOS CONTAINING MATERIALS, UNDERGROUND STORAGE TANKS OR SURFACE IMPOUNDMENTS
FOR HAZARDOUS SUBSTANCES, LEAD IN DRINKING WATER (EXCEPT IN CONCENTRATIONS THAT
COMPLY WITH ALL ENVIRONMENTAL LAWS), OR LEAD BASED PAINT, THE PRESENCE OF WHICH
IS REASONABLY LIKELY TO RESULT IN A MATERIAL ADVERSE EFFECT.

 

(V)           NO LIENS ARE PRESENTLY RECORDED WITH THE APPROPRIATE LAND RECORDS
UNDER OR PURSUANT TO ANY ENVIRONMENTAL LAW WITH RESPECT TO THE PROPERTY AND NO
GOVERNMENTAL AUTHORITY HAS BEEN TAKING OR, TO THE ACTUAL KNOWLEDGE OF BORROWER,
IS IN THE PROCESS OF TAKING ANY ACTION THAT COULD SUBJECT THE PROPERTY TO LIENS
UNDER ANY ENVIRONMENTAL LAW.

 

(VI)          THERE HAVE BEEN NO ENVIRONMENTAL INVESTIGATIONS, STUDIES, AUDITS,
REVIEWS OR OTHER ANALYSES CONDUCTED BY OR THAT ARE IN THE POSSESSION OF BORROWER
IN RELATION TO THE PROPERTY WHICH HAVE NOT BEEN MADE AVAILABLE TO THE AGENT.

 

(F)            MORTGAGE AND OTHER LIENS.  UPON FILING, EACH MORTGAGE CREATES A
VALID AND ENFORCEABLE FIRST PRIORITY LIEN ON THE PROPERTY DESCRIBED THEREIN, AS
SECURITY FOR THE REPAYMENT OF THE INDEBTEDNESS, SUBJECT ONLY TO THE PERMITTED
ENCUMBRANCES APPLICABLE TO THE PROPERTY. THIS AGREEMENT CREATES A VALID AND
ENFORCEABLE FIRST PRIORITY LIEN ON ALL ACCOUNT COLLATERAL. EACH COLLATERAL
SECURITY INSTRUMENT ESTABLISHES AND CREATES A VALID, SUBSISTING AND ENFORCEABLE
LIEN ON AND A SECURITY INTEREST IN, OR CLAIM TO, THE RIGHTS AND PROPERTY
DESCRIBED THEREIN. ALL PROPERTY COVERED BY ANY COLLATERAL SECURITY INSTRUMENT IN
WHICH A SECURITY INTEREST CAN BE PERFECTED BY THE FILING OF A FINANCING
STATEMENT IS SUBJECT TO A UCC FINANCING STATEMENT FILED AND/OR RECORDED, AS
APPROPRIATE (OR IRREVOCABLY DELIVERED TO AN AGENT FOR SUCH RECORDATION OR
FILING) IN ALL PLACES NECESSARY TO PERFECT A VALID FIRST PRIORITY LIEN WITH
RESPECT TO THE RIGHTS AND

 

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PROPERTY THAT ARE THE SUBJECT OF SUCH COLLATERAL SECURITY INSTRUMENT TO THE
EXTENT GOVERNED BY THE UCC.

 

(G)           ASSESSMENTS.  THERE ARE NO PENDING OR, TO THE ACTUAL KNOWLEDGE OF
BORROWER, PROPOSED SPECIAL OR OTHER ASSESSMENTS FOR PUBLIC IMPROVEMENTS OR
OTHERWISE AFFECTING THE PROPERTY, NOR ARE THERE ANY CONTEMPLATED IMPROVEMENTS TO
THE PROPERTY THAT MAY RESULT IN SUCH SPECIAL OR OTHER ASSESSMENTS.

 

(H)           NO JOINT ASSESSMENT; SEPARATE LOTS.  BORROWER HAS NOT SUFFERED,
PERMITTED OR INITIATED THE JOINT ASSESSMENT OF THE PROPERTY (I) WITH ANY OTHER
REAL PROPERTY CONSTITUTING A SEPARATE TAX LOT, AND (II) WITH ANY PORTION OF THE
PROPERTY WHICH MAY BE DEEMED TO CONSTITUTE PERSONAL PROPERTY, OR ANY OTHER
PROCEDURE WHEREBY THE LIEN OF ANY TAXES WHICH MAY BE LEVIED AGAINST SUCH
PERSONAL PROPERTY SHALL BE ASSESSED OR LEVIED OR CHARGED TO THE PROPERTY AS A
SINGLE LIEN. THE PROPERTY IS COMPRISED OF ONE OR MORE PARCELS, EACH OF WHICH
CONSTITUTES A SEPARATE TAX LOT AND NONE OF WHICH CONSTITUTES A PORTION OF ANY
OTHER TAX LOT.

 

(I)            NO PRIOR ASSIGNMENT.  THE AGENT IS THE COLLATERAL ASSIGNEE OF
BORROWER’S INTEREST UNDER THE LEASES. THERE ARE NO PRIOR ASSIGNMENTS OF THE
LEASES OR ANY PORTION OF THE RENT DUE AND PAYABLE OR TO BECOME DUE AND PAYABLE
WHICH ARE PRESENTLY OUTSTANDING.

 

(J)            PERMITS; CERTIFICATE OF OCCUPANCY.  BORROWER HAS OBTAINED ALL
PERMITS NECESSARY TO THE USE AND OPERATION OF THE PROPERTY EXCEPT WHERE THE
FAILURE TO OBTAIN SUCH PERMITS IS NOT REASONABLY LIKELY TO HAVE A MATERIAL
ADVERSE EFFECT. THE USE BEING MADE OF THE PROPERTY IS IN CONFORMITY WITH THE
CERTIFICATE OF OCCUPANCY AND/OR SUCH PERMITS FOR THE PROPERTY AND ANY OTHER
RESTRICTIONS, COVENANTS OR CONDITIONS AFFECTING THE PROPERTY, EXCEPT FOR
NON-CONFORMITY WHICH IS NOT REASONABLY LIKELY TO RESULT IN A MATERIAL ADVERSE
EFFECT.

 

(K)           FLOOD ZONE.  EXCEPT AS SHOWN ON THE SURVEY, THE PROPERTY DESCRIBED
THEREIN IS NOT LOCATED IN A FLOOD HAZARD AREA AS DEFINED BY THE FEDERAL
INSURANCE ADMINISTRATION.

 

(L)            PHYSICAL CONDITION.  EXCEPT AS SET FORTH IN THE ENGINEERING
REPORT, TO THE BEST KNOWLEDGE OF BORROWER, THE PROPERTY IS FREE OF STRUCTURAL
DEFECTS AND ALL BUILDING SYSTEMS CONTAINED THEREIN ARE IN GOOD WORKING ORDER
SUBJECT TO ORDINARY WEAR AND TEAR.

 

(M)          SECURITY DEPOSITS.  BORROWER AND THE MANAGER ARE IN COMPLIANCE WITH
ALL LEGAL REQUIREMENTS RELATING TO ALL SECURITY DEPOSITS WITH RESPECT TO THE
PROPERTY, EXCEPT WHERE THE FAILURE TO COMPLY IS NOT REASONABLY LIKELY TO RESULT
IN A MATERIAL ADVERSE EFFECT.

 

(N)           INTELLECTUAL PROPERTY.  ALL MATERIAL INTELLECTUAL PROPERTY THAT
BORROWER OWNS OR HAS PENDING, OR UNDER WHICH IT IS LICENSED, ARE IN GOOD
STANDING AND UNCONTESTED. THERE IS NO RIGHT UNDER ANY INTELLECTUAL PROPERTY
NECESSARY TO THE BUSINESS OF BORROWER AS PRESENTLY CONDUCTED OR AS BORROWER
CONTEMPLATES CONDUCTING ITS BUSINESS. BORROWER HAS NOT INFRINGED, IS NOT
INFRINGING, AND HAS NOT RECEIVED NOTICE OF INFRINGEMENT WITH RESPECT TO ASSERTED
TRADEMARKS OF OTHERS. THERE IS NO INFRINGEMENT BY OTHERS OF MATERIAL
INTELLECTUAL PROPERTY OF BORROWER.

 

(O)           NO ENCROACHMENTS.  EXCEPT AS SHOWN ON THE SURVEY, TO THE BEST
KNOWLEDGE OF BORROWER, (I) ALL OF THE IMPROVEMENTS WHICH WERE INCLUDED IN
DETERMINING THE

 

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APPRAISED VALUE OF THE PROPERTY LIE WHOLLY WITHIN THE BOUNDARIES AND BUILDING
RESTRICTION LINES OF THE PROPERTY, (II) NO IMPROVEMENTS ON ADJOINING PROPERTIES
ENCROACH UPON THE PROPERTY, (III) NO EASEMENTS OR OTHER ENCUMBRANCES UPON THE
PROPERTY ENCROACH UPON ANY OF THE IMPROVEMENTS, SO AS TO MATERIALLY AND
ADVERSELY AFFECT THE VALUE OR MARKETABILITY OF THE PROPERTY AND (IV) ALL OF THE
IMPROVEMENTS COMPLY WITH ALL MATERIAL REQUIREMENTS OF ANY APPLICABLE ZONING AND
SUBDIVISION LAWS AND ORDINANCES.

 

(P)           MANAGEMENT AGREEMENT.  THE MANAGEMENT AGREEMENT IS IN FULL FORCE
AND EFFECT. THERE IS NO DEFAULT, BREACH OR VIOLATION EXISTING THEREUNDER BY
BORROWER OR, TO THE BEST KNOWLEDGE OF BORROWER, ANY OTHER PARTY THERETO AND NO
EVENT (OTHER THAN PAYMENTS DUE BUT NOT YET DELINQUENT) WHICH, WITH THE PASSAGE
OF TIME OR WITH NOTICE AND THE EXPIRATION OF ANY GRACE OR CURE PERIOD, WOULD
CONSTITUTE A DEFAULT, BREACH OR VIOLATION BY BORROWER OR, TO THE BEST KNOWLEDGE
OF BORROWER, ANY OTHER PARTY THEREUNDER OR ENTITLE BORROWER OR, TO THE BEST
KNOWLEDGE OF BORROWER, ANY OTHER PARTY THERETO TO TERMINATE ANY SUCH AGREEMENT.

 

(Q)           LEASES.  THE PROPERTY IS NOT SUBJECT TO ANY LEASES OTHER THAN THE
LEASES DESCRIBED IN THE RENT ROLL OR THE ENGINEERING REPORT DELIVERED TO AGENT
IN CONNECTION WITH THE MAKING OF THE LOAN. NO PERSON HAS ANY POSSESSORY INTEREST
IN THE PROPERTY OR RIGHT TO OCCUPY THE SAME EXCEPT UNDER AND PURSUANT TO THE
PROVISIONS OF THE LEASES. THE CURRENT LEASES ARE IN FULL FORCE AND EFFECT AND
THERE ARE NO DEFAULTS THEREUNDER BY EITHER PARTY AND NO CONDITIONS WHICH WITH
THE PASSAGE OF TIME AND/OR NOTICE WOULD CONSTITUTE DEFAULTS THEREUNDER, EXCEPT
FOR SUCH DEFAULTS AS ARE NOT REASONABLY LIKELY TO RESULT IN A MATERIAL ADVERSE
EFFECT.

 

(R)            CREDIT LEASE.  WITH RESPECT TO EACH CTL PROPERTY ONLY:

 

(1)           SUCH CTL PROPERTY IS SUBJECT TO A CREDIT LEASE; SUCH CREDIT LEASE
IS IN FULL FORCE AND EFFECT, AND IS A LEGAL, VALID, BINDING AND ENFORCEABLE
AGREEMENT OF THE RELATED TENANT, EXCEPT AS SUCH ENFORCEMENT MAY BE LIMITED BY
BANKRUPTCY, INSOLVENCY OR OTHER LAWS AFFECTING THE RIGHTS OF CREDITORS
GENERALLY, AND GENERAL PRINCIPLES OF EQUITY; NO UNCURED DEFAULT BY THE
PROPERTY-OWNING BORROWER OR THE TENANT HAS OCCURRED UNDER SUCH CREDIT LEASE AND
THERE IS NO EXISTING CONDITION WHICH, BUT FOR THE PASSAGE OF TIME OR THE GIVING
OF NOTICE, OR BOTH, WOULD RESULT IN A DEFAULT UNDER THE TERMS OF SUCH CREDIT
LEASE.

 

(2)           OTHER THAN WITH RESPECT TO EACH CTL PROPERTY OWNED BY A
PROPERTY-OWNING BORROWER ON THE CLOSING DATE, EACH CREDIT LEASE IS SUBORDINATE
TO THE RELATED MORTGAGE, EITHER PURSUANT TO THE TERMS AND CONDITIONS OF SUCH
CREDIT LEASE OR PURSUANT TO THE TERMS AND CONDITIONS OF A SUBORDINATION,
NON-DISTURBANCE AND ATTORNMENT AGREEMENT BETWEEN THE AGENT AND THE APPLICABLE
TENANT; ANY SUBLEASES ENTERED INTO BY SUCH TENANT WILL BE SUBJECT AND
SUBORDINATE TO THE CREDIT LEASE AND WILL NOT RELIEVE THE TENANT OF ITS
OBLIGATIONS UNDER THE CREDIT LEASE; IN THE EVENT THAT THE AGENT ACQUIRES TITLE
TO A CTL PROPERTY BY FORECLOSURE OR OTHERWISE, THE LESSOR’S INTEREST UNDER THE
RELATED CREDIT LEASE IS FREELY ASSIGNABLE BY THE AGENT AND ITS SUCCESSORS AND
ASSIGNS TO ANY PERSON WITHOUT THE CONSENT OF THE TENANT, AND, IN THE EVENT THE
LESSOR’S INTEREST IS SO ASSIGNED, THE TENANT WILL BE OBLIGATED TO RECOGNIZE THE
ASSIGNEE AS LESSOR UNDER SUCH CREDIT LEASE.

 

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(3)           EACH CREDIT LEASE HAS AN ORIGINAL TERM ENDING ON OR AFTER THE DATE
THE PROPERTY-OWNING BORROWER IS REQUIRED TO DEPOSIT ITS FINAL PAYMENT ON THE
RELATED ADVANCE WITH THE LENDERS UNLESS COVERED BY EXTENDED AMORTIZATION OR
RESIDUAL VALUE INSURANCE.

 

(4)           THE MONTHLY PAYMENT FOR THE RELATED ADVANCE IS LESS THAN OR EQUAL
TO THE BASIC RENT DUE UNDER THE RELATED CREDIT LEASE (UNLESS AN “EXTENDED
AMORTIZATION POLICY” OR A RESIDUAL VALUE INSURANCE POLICY OR CASH RESERVES OR
OTHER FORM OF CREDIT ENHANCEMENT HAS BEEN OBTAINED WHICH HAS BEEN IN EACH CASE
DISCLOSED TO AGENT).

 

(5)           THERE IS NO ASSIGNMENT OF ANY CREDIT LEASE BY ANY TENANT PENDING.

 

(6)           EACH TENANT HAS AGREED TO NOTIFY THE RELATED MORTGAGEE OF ANY
DEFAULT UNDER THE RELATED CREDIT LEASE AND TO PROVIDE SUCH MORTGAGEE WITH
ADDITIONAL TIME AND OPPORTUNITY TO CURE.

 

(7)           EXCEPT AS OTHERWISE DISCLOSED TO AGENT WITH RESPECT TO TENANTS
WHICH ARE MASTER LESSOR TO SUBTENANTS, EACH CTL PROPERTY IS NOT SUBJECT TO ANY
LEASE OTHER THAN THE RELATED CREDIT LEASE, NO PERSON HAS ANY POSSESSORY INTEREST
IN, OR RIGHT TO OCCUPY, THE RELATED CTL PROPERTY EXCEPT UNDER AND PURSUANT TO
SUCH CREDIT LEASE AND THE TENANT UNDER THE RELATED CREDIT LEASE IS IN OCCUPANCY
OF THE ENTIRE PROPERTY.

 

(8)           NO TENANT UNDER A CREDIT LEASE (NOR LEASE GUARANTOR, IF
APPLICABLE) HAS BEEN RELEASED, IN WHOLE OR IN PART, FROM ITS OBLIGATIONS UNDER
THE CREDIT LEASE (OR LEASE GUARANTY, AS APPLICABLE).

 

(9)           UNDER THE TERMS OF THE CREDIT LEASE, THE TENANT IS NOT PERMITTED
TO ASSIGN OR SUBLET ITS INTEREST OR OBLIGATIONS UNDER THE CREDIT LEASE UNLESS
SUCH TENANT REMAINS FULLY LIABLE THEREUNDER.

 

(10)         EACH TENANT UNDER A CREDIT LEASE IS REQUIRED (OR HAS BEEN
IRREVOCABLY DIRECTED) TO MAKE ALL RENTAL PAYMENTS DIRECTLY TO THE COLLECTION
ACCOUNT OR A LOCKBOX ESTABLISHED BY THE PROPERTY-OWNING BORROWER WHICH PROVIDES
FOR AUTOMATIC SWEEP OF DEPOSITS TO THE COLLECTION ACCOUNT.

 

(11)         WITH RESPECT TO ANY CREDIT LEASE GUARANTEED BY THE PARENT OR
AFFILIATE OF A TENANT, EACH EXISTING LEASE GUARANTY IS IN FULL FORCE AND EFFECT,
AND NO DEFAULT EXISTS THEREUNDER.

 

(12)         WITH RESPECT TO ANY CREDIT LEASE THAT IS NOT A TRIPLE NET LEASE OR
DOUBLE NET LEASE, SUCH CREDIT LEASE IS A BONDABLE LEASE WITH NO TERMINATION OR
RENT ABATEMENT RIGHTS BY THE TENANT, EXCEPT IN CONNECTION WITH THE EXERCISE OF A
PURCHASE OPTION; THE OBLIGATIONS OF ANY TENANT UNDER SUCH LEASE (INCLUDING, BUT
NOT LIMITED TO, THE OBLIGATION OF THE TENANT TO PAY FIXED AND ADDITIONAL RENT),
ARE NOT AFFECTED BY REASON OF ANY DAMAGE TO OR DESTRUCTION OF ANY PORTION OF THE
CTL PROPERTY, ANY TAKING OF THE CTL PROPERTY OR ANY PART THEREOF BY CONDEMNATION
OR OTHERWISE, OR ANY PROHIBITION, LIMITATION,

 

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INTERRUPTION, RESTRICTION, OR INTERFERENCE OF THE TENANT’S USE, OCCUPANCY OR
ENJOYMENT OF THE CTL PROPERTY.

 

(13)         EACH CREDIT LEASE CONTAINS NO MONETARY OBLIGATIONS OR OBLIGATIONS
ASSOCIATED WITH MANAGING, OWNING, DEVELOPING AND OPERATING THE CTL PROPERTY
(INCLUDING, BUT NOT LIMITED TO, THE COSTS ASSOCIATED WITH UTILITIES, TAXES,
INSURANCE, CAPITAL AND STRUCTURAL IMPROVEMENTS AND MAINTENANCE AND REPAIRS), ON
THE PART OF THE PROPERTY-OWNING BORROWER UNLESS SUCH OBLIGATIONS ARE FULLY
REIMBURSABLE OR HAVE BEEN PAID BY THE TENANT.

 

(14)         EACH CREDIT LEASE CONTAINS CUSTOMARY AND ENFORCEABLE PROVISIONS
WHICH RENDER THE RIGHTS AND REMEDIES OF THE LESSOR THEREUNDER ADEQUATE FOR THE
ENFORCEMENT AND SATISFACTION OF THE LESSOR’S RIGHTS THEREUNDER.

 

(15)         ANY ANTICIPATED MAINTENANCE, REPAIR, OR REPLACEMENT OBLIGATIONS
IMPOSED BY ANY EASEMENT OR RECIPROCAL EASEMENT AGREEMENT EITHER IS A DIRECT
OBLIGATION OF THE TENANT OR AN ADJACENT PROPERTY OWNER OR IS AN OBLIGATION OR
LIABILITY OF THE PROPERTY-OWNING BORROWER, REIMBURSABLE BY THE TENANT, OR HAS
BEEN RESERVED FOR UNDER THE LOAN DOCUMENTS.

 

(16)         THE CREDIT LEASE CANNOT BE MODIFIED WITHOUT THE CONSENT OF THE
MORTGAGEE THEREUNDER.

 

(17)         EXCEPT FOR (A) A TERMINATION DUE TO A DEFAULT BY THE
PROPERTY-OWNING BORROWER UNDER THE CREDIT LEASE OR (B) A TERMINATION DUE TO
CASUALTY OR CONDEMNATION, NO TENANT CAN TERMINATE A CREDIT LEASE FOR ANY REASON
PRIOR TO THE PAYMENT IN FULL OF OR THE PAYMENT OF FUNDS SUFFICIENT TO PAY IN
FULL (1) THE PRINCIPAL BALANCE OF THE RELATED ADVANCE, (2) ALL ACCRUED AND
UNPAID INTEREST ON THE RELATED ADVANCE AND (3) ANY OTHER SUMS DUE AND PAYABLE
UNDER THE RELATED ADVANCE, AS OF THE TERMINATION DATE.

 

(18)         NO RIGHT OR CLAIM OF RESCISSION, OFFSET, ABATEMENT, DIMINUTION,
DEFENSE OR COUNTERCLAIM TO A CREDIT LEASE HAS BEEN ASSERTED WITH RESPECT
THERETO, NOR IS THERE ANY EXISTING CONDITION WHICH, BUT FOR THE PASSAGE OF TIME
OR GIVING OF NOTICE, WOULD RESULT IN A RIGHT OR CLAIM OF RESCISSION, OFFSET,
ABATEMENT, DIMINUTION, DEFENSE OR COUNTERCLAIM UNDER THE TERMS OF ANY CREDIT
LEASE (OTHER THAN FOR NONMATERIAL PUNCH LIST ITEMS).

 

(19)         THE OBLIGATIONS OF THE TENANT UNDER ANY CREDIT LEASE (INCLUDING,
BUT NOT LIMITED TO, THE OBLIGATIONS OF THE TENANT TO PAY FIXED AND ADDITIONAL
RENT), ARE NOT AFFECTED BY REASON OF ANY DAMAGE TO OR DESTRUCTION OF ANY PORTION
OF THE LEASED PROPERTY OR ANY TAKING OF THE LEASED PROPERTY OR ANY PART THEREOF
BY CONDEMNATION OR OTHERWISE, EXCEPT FOR CTL PROPERTIES SUBJECT TO CASUALTY AND
CONDEMNATION LEASE ENHANCEMENT POLICIES OR WHICH PERMIT TERMINATION OF RENT ONLY
PURSUANT TO EXERCISE OF A FUNDING OPTION SUFFICIENT TO PAY THE ADVANCE IN FULL.

 

(20)         IN THE CASE OF A CREDIT LEASE WITH A “LEASE ENHANCEMENT POLICY”
AND/OR AN “EXTENDED AMORTIZATION POLICY” AND/OR RESIDUAL VALUE INSURANCE POLICY,
THE

 

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ENTIRE PREMIUM HAS BEEN PAID IN FULL FOR EACH SUCH POLICY (OR IS REQUIRED TO BE
PAID WITHIN THIRTY DAYS AFTER THE RELATED CLOSING DATE), SUCH POLICIES ARE EACH
IN FULL FORCE AND EFFECT, AND THE LEGAL, VALID AND BINDING OBLIGATION OF THE
INSURER THEREUNDER, ENFORCEABLE IN ACCORDANCE WITH THEIR RESPECTIVE TERMS,
EXCEPT AS SUCH ENFORCEMENT MAY BE LIMITED BY BANKRUPTCY, INSOLVENCY,
REORGANIZATION, RECEIVERSHIP, MORATORIUM OR OTHER LAWS RELATING TO OR AFFECTING
THE RIGHTS OF CREDITORS GENERALLY AND BY GENERAL PRINCIPLES OF EQUITY
(REGARDLESS OF WHETHER SUCH ENFORCEMENT IS CONSIDERED IN A PROCEEDING IN EQUITY
OR AT LAW).

 

(S)           GROUND LEASE.  OTHER THAN THE GROUND LEASE, THE PROPERTY DOES NOT
CONSIST OF A LEASEHOLD ESTATE IN WHOLE OR IN PART. WITH RESPECT TO THE GROUND
LEASE:

 

(I)            THE GROUND LEASE OR A MEMORANDUM THEREOF, INCLUDING ALL
AMENDMENTS AND MODIFICATIONS THERETO, OR A SEPARATE AGREEMENT SIGNED BY THE
APPLICABLE LESSOR HAS BEEN DULY RECORDED AND BY ITS TERMS PERMITS THE INTEREST
OF THE BORROWER THEREUNDER TO BE ENCUMBERED BY THE APPLICABLE MORTGAGE AND THERE
HAS BEEN NO CHANGE IN THE TERMS OF THE GROUND LEASE SINCE ITS RECORDATION.

 

(II)           THE GROUND LEASE IS NOT SUBJECT TO ANY LIENS OR ENCUMBRANCES
OTHER THAN THE MORTGAGE, SUBJECT TO THE PERMITTED ENCUMBRANCES, AND THE GROUND
LEASE IS PRIOR TO ALL LIENS, CHARGES AND ENCUMBRANCES ON THE FEE INTEREST OF THE
LESSOR THEREUNDER.

 

(III)          THE GROUND LEASE IS VALID AND SUBSISTING AND IS IN FULL FORCE AND
EFFECT IN ACCORDANCE WITH ITS TERMS AND NO UNCURED DEFAULT HAS OCCURRED UNDER
THE GROUND LEASE.

 

(IV)          THE MORTGAGE ENCUMBERING THE GROUND LEASE CONFORMS AND COMPLIES
WITH THE GROUND LEASE, DOES NOT CONSTITUTE A VIOLATION OR DEFAULT UNDER THE
GROUND LEASE, AND IS AND SHALL AT ALL TIMES CONSTITUTE A VALID LIEN (SUBJECT
ONLY TO PERMITTED ENCUMBRANCES) ON THE BORROWER’S ENTIRE ESTATE UNDER THE GROUND
LEASE.

 

(V)           ALL GROUND RENT DUE AND PAYABLE THROUGH AND INCLUDING THE ADVANCE
CLOSING DATE THEREFOR HAS BEEN PAID.

 

(VI)          ALL TERMS, CONDITIONS, AND AGREEMENTS CONTAINED IN THE GROUND
LEASE HAVE BEEN PERFORMED TO THE EXTENT THEY APPLY TO PERIODS THROUGH AND
INCLUDING THE ADVANCE CLOSING DATE THEREFOR.

 

(VII)         THE GROUND LEASE GRANTS ANY LEASEHOLD MORTGAGEE STANDARD
PROTECTIONS NECESSARY TO PROTECT THE SECURITY OF A LEASEHOLD MORTGAGEE
(INCLUDING THE RIGHT OF THE LEASEHOLD MORTGAGEE TO RECEIVE NOTICE OF LESSEE’S
DEFAULT UNDER THE GROUND LEASE, THE RIGHT OF THE LEASEHOLD MORTGAGEE, WITH
ADEQUATE TIME, TO CURE SUCH DEFAULT AND, IN THE CASE OF INCURABLE DEFAULTS OF
LESSEE, THE RIGHT OF THE LEASEHOLD MORTGAGEE TO ENTER INTO A NEW GROUND LEASE
WITH LESSOR ON THE SAME TERMS AS THE EXISTING GROUND LEASE).

 

(VIII)        THE GROUND LEASE HAS A TERM (INCLUSIVE OF ANY EXERCISED RENEWAL OR
EXTENSION PERIODS) WHICH EXTENDS NOT LESS THAN TWENTY (20) YEARS BEYOND THE
MATURITY DATE.

 

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(IX)           THE GROUND LEASE REQUIRES THE LESSOR TO ENTER INTO A NEW GROUND
LEASE UPON THE TERMINATION OF THE GROUND LEASE FOR ANY REASON, INCLUDING THE
REJECTION OF A GROUND LEASE IN BANKRUPTCY.

 

SECTION 4.3.            SURVIVAL OF REPRESENTATIONS.  BORROWER AGREES THAT
(I) ALL OF THE REPRESENTATIONS AND WARRANTIES OF BORROWER SET FORTH IN
SECTION 4.1 AND 4.2 AND IN THE OTHER LOAN DOCUMENTS DELIVERED ON THE CLOSING
DATE ARE MADE AS OF THE CLOSING DATE, AND (II) ALL REPRESENTATIONS AND
WARRANTIES MADE BY BORROWER SHALL SURVIVE THE DELIVERY OF THE NOTE AND MAKING OF
THE LOAN AND CONTINUE FOR SO LONG AS ANY AMOUNT REMAINS OWING TO THE LENDERS
UNDER THIS AGREEMENT, THE NOTE OR ANY OF THE OTHER LOAN DOCUMENTS; PROVIDED,
HOWEVER, THAT THE REPRESENTATIONS SET FORTH IN SECTION 4.2(E) SHALL SURVIVE IN
PERPETUITY. ALL REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS MADE IN
THIS AGREEMENT OR IN THE OTHER LOAN DOCUMENTS SHALL BE DEEMED TO HAVE BEEN
RELIED UPON BY THE LENDERS AND COLLATERAL AGENT NOTWITHSTANDING ANY
INVESTIGATION HERETOFORE OR HEREAFTER MADE BY THE LENDERS AND COLLATERAL AGENT
OR ON THEIR BEHALF.

 

ARTICLE V.
AFFIRMATIVE COVENANTS

 

SECTION 5.1.            AFFIRMATIVE COVENANTS.  BORROWER COVENANTS AND AGREES
THAT, FROM THE DATE HEREOF AND UNTIL PAYMENT IN FULL OF THE INDEBTEDNESS:

 

(A)           EXISTENCE; COMPLIANCE WITH LEGAL REQUIREMENTS; INSURANCE. 
BORROWER SHALL DO OR CAUSE TO BE DONE ALL THINGS NECESSARY TO PRESERVE, RENEW
AND KEEP IN FULL FORCE AND EFFECT ITS EXISTENCE AS A LIMITED LIABILITY COMPANY,
OR AS THE CASE MAY BE, LIMITED PARTNERSHIP, RIGHTS, LICENSES, PERMITS AND
FRANCHISES NECESSARY FOR THE CONDUCT OF ITS BUSINESS AND COMPLY WITH ALL LEGAL
REQUIREMENTS AND INSURANCE REQUIREMENTS APPLICABLE TO IT AND THE PROPERTY,
EXCEPT FOR SUCH NON-COMPLIANCE WHICH IS NOT REASONABLY LIKELY TO RESULT IN A
MATERIAL ADVERSE EFFECT. BORROWER SHALL AT ALL TIMES MAINTAIN, PRESERVE AND
PROTECT ALL FRANCHISES AND TRADE NAMES AND PRESERVE ALL THE REMAINDER OF ITS
PROPERTY NECESSARY FOR THE CONTINUED CONDUCT OF ITS BUSINESS AND KEEP THE
PROPERTY IN GOOD REPAIR, WORKING ORDER AND CONDITION, EXCEPT FOR REASONABLE WEAR
AND USE (AND EXCEPT FOR CASUALTY LOSSES AS TO WHICH OTHER PROVISIONS HEREOF
SHALL GOVERN), AND FROM TIME TO TIME MAKE, OR CAUSE TO BE MADE, ALL REASONABLY
NECESSARY REPAIRS, RENEWALS, REPLACEMENTS, BETTERMENTS AND IMPROVEMENTS THERETO.
BORROWER SHALL OR SHALL CAUSE ITS TENANTS TO KEEP THE PROPERTY INSURED AT ALL
TIMES, BY FINANCIALLY SOUND AND REPUTABLE INSURERS, TO SUCH EXTENT AND AGAINST
SUCH RISKS, AND MAINTAIN LIABILITY AND SUCH OTHER INSURANCE, AS MORE FULLY
PROVIDED IN THIS AGREEMENT, AND OTHERWISE PERFORM AND COMPLY WITH ALL
OBLIGATIONS OF BORROWER UNDER THE MORTGAGES.

 

(B)           BASIC CARRYING COSTS AND OTHER CLAIMS.  BORROWER SHALL PAY AND
DISCHARGE ALL IMPOSITIONS, AS WELL AS ALL LAWFUL CLAIMS FOR LABOR, MATERIALS AND
SUPPLIES OR OTHERWISE WHEN DUE AND PAYABLE ALL AS MORE FULLY PROVIDED IN, AND
SUBJECT TO ANY RIGHTS TO CONTEST CONTAINED IN, THE MORTGAGE. BORROWER SHALL PAY
ALL BASIC CARRYING COSTS WITH RESPECT TO BORROWER AND THE PROPERTY IN ACCORDANCE
WITH THE PROVISIONS OF THE MORTGAGE AND THIS AGREEMENT, SUBJECT, HOWEVER, TO
BORROWER’S RIGHTS TO CONTEST PAYMENT OF IMPOSITIONS IN ACCORDANCE WITH THE
MORTGAGE. BORROWER’S OBLIGATION TO PAY BASIC CARRYING COSTS PURSUANT TO THIS
AGREEMENT SHALL INCLUDE, TO THE EXTENT PERMITTED BY APPLICABLE LAW, IMPOSITIONS
RESULTING FROM FUTURE CHANGES IN

 

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LAW WHICH IMPOSE UPON A LENDER AN OBLIGATION TO PAY ANY PROPERTY TAXES ON THE
PROPERTY OR OTHER IMPOSITIONS. BORROWER SHALL (X) PAY ITS TRADE PAYABLES WITHIN
FORTY-FIVE (45) DAYS FROM THE DATE SUCH TRADE PAYABLES ARE INCURRED AND (Y) NOT
PERMIT ITS TRADE PAYABLES TO EXCEED 2% OF THE PRINCIPAL INDEBTEDNESS.

 

(C)           LITIGATION.  BORROWER SHALL GIVE PROMPT WRITTEN NOTICE TO AGENT OF
ANY LITIGATION OR GOVERNMENTAL PROCEEDINGS PENDING OR THREATENED (IN WRITING)
AGAINST BORROWER, OR THE PROPERTY WHICH IS REASONABLY LIKELY TO HAVE A MATERIAL
ADVERSE EFFECT.

 

(D)           ENVIRONMENTAL REMEDIATION.

 

(I)           IF ANY INVESTIGATION, SITE MONITORING, CLEANUP, REMOVAL,
RESTORATION OR OTHER REMEDIAL WORK OF ANY KIND OR NATURE IS REQUIRED PURSUANT TO
AN ORDER OR DIRECTIVE OF ANY GOVERNMENTAL AUTHORITY OR UNDER ANY APPLICABLE
ENVIRONMENTAL LAW, BECAUSE OF OR IN CONNECTION WITH THE CURRENT OR FUTURE
PRESENCE, SUSPECTED PRESENCE, RELEASE OR SUSPECTED RELEASE OF A HAZARDOUS
SUBSTANCE ON, UNDER OR FROM THE PROPERTY OR ANY PORTION THEREOF (COLLECTIVELY,
THE “REMEDIAL WORK”), BORROWER SHALL PROMPTLY COMMENCE AND DILIGENTLY PROSECUTE
TO COMPLETION ALL SUCH REMEDIAL WORK, AND SHALL CONDUCT SUCH REMEDIAL WORK IN
ACCORDANCE WITH APPLICABLE ENVIRONMENTAL LAWS. IN ALL EVENTS, SUCH REMEDIAL WORK
SHALL BE COMMENCED WITHIN SUCH PERIOD OF TIME AS REQUIRED UNDER ANY APPLICABLE
ENVIRONMENTAL LAW; PROVIDED, HOWEVER, THAT BORROWER SHALL NOT BE REQUIRED TO
COMMENCE SUCH REMEDIAL WORK WITHIN THE ABOVE SPECIFIED TIME PERIODS:  (X) IF
PREVENTED FROM DOING SO BY ANY GOVERNMENTAL AUTHORITY, (Y) IF COMMENCING SUCH
REMEDIAL WORK WITHIN SUCH TIME PERIODS WOULD RESULT IN BORROWER OR SUCH REMEDIAL
WORK VIOLATING ANY ENVIRONMENTAL LAW OR (Z) IF BORROWER, AT ITS EXPENSE AND
AFTER PRIOR NOTICE TO AGENT, IS CONTESTING BY APPROPRIATE LEGAL, ADMINISTRATIVE
OR OTHER PROCEEDINGS CONDUCTED IN GOOD FAITH AND WITH DUE DILIGENCE THE NEED TO
PERFORM REMEDIAL WORK, AS LONG AS (1) BORROWER IS PERMITTED BY THE APPLICABLE
ENVIRONMENTAL LAWS TO DELAY PERFORMANCE OF THE REMEDIAL WORK PENDING SUCH
PROCEEDINGS, (2) NEITHER THE PROPERTY NOR ANY PART THEREOF OR INTEREST THEREIN
SHALL BE SOLD, FORFEITED OR LOST IF BORROWER DOES NOT PERFORM THE REMEDIAL WORK
BEING CONTESTED, AND BORROWER WOULD HAVE THE OPPORTUNITY TO DO SO, IN THE EVENT
OF BORROWER’S FAILURE TO PREVAIL IN THE CONTEST, (3) THE LENDERS WOULD NOT, BY
VIRTUE OF SUCH PERMITTED CONTEST, BE EXPOSED TO ANY RISK OF ANY CIVIL LIABILITY
FOR WHICH BORROWER HAS NOT FURNISHED ADDITIONAL SECURITY AS PROVIDED IN
CLAUSE (4) BELOW, OR TO ANY RISK OF CRIMINAL LIABILITY, AND NEITHER THE PROPERTY
NOR ANY INTEREST THEREIN WOULD BE SUBJECT TO THE IMPOSITION OF ANY LIEN FOR
WHICH BORROWER HAS NOT FURNISHED ADDITIONAL SECURITY AS PROVIDED IN
CLAUSE (4) BELOW, AS A RESULT OF THE FAILURE TO PERFORM SUCH REMEDIAL WORK AND
(4) BORROWER SHALL HAVE FURNISHED TO THE AGENT ADDITIONAL SECURITY IN RESPECT OF
THE REMEDIAL WORK BEING CONTESTED AND THE LOSS OR DAMAGE THAT MAY RESULT FROM
BORROWER’S FAILURE TO PREVAIL IN SUCH CONTEST IN SUCH AMOUNT AS MAY BE
REASONABLY REQUESTED BY THE AGENT.

 

(II)          IF REQUESTED BY THE AGENT, ALL REMEDIAL WORK UNDER
CLAUSE (A) ABOVE SHALL BE PERFORMED BY CONTRACTORS, AND UNDER THE SUPERVISION OF
A CONSULTING ENGINEER, EACH APPROVED IN ADVANCE BY THE AGENT WHICH APPROVAL
SHALL NOT BE UNREASONABLY WITHHELD OR DELAYED. BORROWER SHALL PAY ALL COSTS AND
EXPENSES REASONABLY INCURRED IN CONNECTION WITH SUCH REMEDIAL WORK. IF BORROWER
DOES NOT TIMELY COMMENCE

 

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AND DILIGENTLY PROSECUTE TO COMPLETION THE REMEDIAL WORK, THE AGENT MAY (BUT
SHALL NOT BE OBLIGATED TO), UPON 30 DAYS PRIOR WRITTEN NOTICE TO BORROWER OF ITS
INTENTION TO DO SO, CAUSE SUCH REMEDIAL WORK TO BE PERFORMED. BORROWER SHALL PAY
OR REIMBURSE THE AGENT ON DEMAND FOR ALL EXPENSES (INCLUDING REASONABLE
ATTORNEYS’ FEES AND DISBURSEMENTS, BUT EXCLUDING INTERNAL OVERHEAD,
ADMINISTRATIVE AND SIMILAR COSTS OF THE LENDERS) REASONABLY RELATING TO OR
INCURRED BY THE AGENT IN CONNECTION WITH MONITORING, REVIEWING OR PERFORMING ANY
REMEDIAL WORK IN ACCORDANCE HEREWITH.

 

(III)         BORROWER SHALL NOT COMMENCE ANY REMEDIAL WORK UNDER
CLAUSE (A) ABOVE, NOR ENTER INTO ANY SETTLEMENT AGREEMENT, CONSENT DECREE OR
OTHER COMPROMISE RELATING TO ANY HAZARDOUS SUBSTANCES OR ENVIRONMENTAL LAWS
WITHOUT PROVIDING NOTICE TO THE AGENT AS PROVIDED IN SECTION 5.1(F).
NOTWITHSTANDING THE FOREGOING, IF THE PRESENCE OR THREATENED PRESENCE OF
HAZARDOUS SUBSTANCES ON, UNDER, ABOUT OR EMANATING FROM THE PROPERTY POSES AN
IMMEDIATE THREAT TO THE HEALTH, SAFETY OR WELFARE OF ANY PERSON OR THE
ENVIRONMENT, OR IS OF SUCH A NATURE THAT AN IMMEDIATE RESPONSE IS NECESSARY OR
REQUIRED UNDER APPLICABLE ENVIRONMENTAL LAW, BORROWER MAY COMPLETE ALL NECESSARY
REMEDIAL WORK. IN SUCH EVENTS, BORROWER SHALL NOTIFY AGENT AS SOON AS
PRACTICABLE AND, IN ANY EVENT, WITHIN THREE BUSINESS DAYS, OF ANY ACTION TAKEN.

 

(E)           ENVIRONMENTAL MATTERS; INSPECTION.

 

(I)           BORROWER SHALL NOT PERMIT A HAZARDOUS SUBSTANCE TO BE PRESENT ON,
UNDER OR TO EMANATE FROM THE PROPERTY, OR MIGRATE FROM ADJOINING PROPERTY
CONTROLLED BY BORROWER ONTO OR INTO THE PROPERTY, EXCEPT UNDER CONDITIONS
PERMITTED BY APPLICABLE ENVIRONMENTAL LAWS AND, IN THE EVENT THAT SUCH HAZARDOUS
SUBSTANCES ARE PRESENT ON, UNDER OR EMANATE FROM THE PROPERTY, OR MIGRATE ONTO
OR INTO THE PROPERTY, BORROWER SHALL CAUSE THE REMOVAL OR REMEDIATION OF SUCH
HAZARDOUS SUBSTANCES, IN ACCORDANCE WITH THIS AGREEMENT AND ENVIRONMENTAL LAWS,
EITHER ON ITS OWN BEHALF OR BY CAUSING A TENANT OR OTHER PARTY PRIMARILY AT
FAULT TO PERFORM SUCH REMOVAL AND REMEDIATION. BORROWER SHALL USE COMMERCIALLY
REASONABLE EFFORTS TO PREVENT, AND TO SEEK THE REMEDIATION OF, ANY MIGRATION OF
HAZARDOUS SUBSTANCES ONTO OR INTO THE PROPERTY FROM ANY ADJOINING PROPERTY.

 

(II)          UPON REASONABLE PRIOR WRITTEN NOTICE, THE AGENT SHALL HAVE THE
RIGHT, EXCEPT AS OTHERWISE PROVIDED UNDER LEASES, AT ALL REASONABLE TIMES DURING
NORMAL BUSINESS HOURS TO ENTER UPON AND INSPECT ALL OR ANY PORTION OF THE
PROPERTY, PROVIDED THAT SUCH INSPECTIONS SHALL NOT UNREASONABLY INTERFERE WITH
THE OPERATION OR THE TENANTS, RESIDENTS OR OCCUPANTS OF THE PROPERTY. IF THE
AGENT HAS REASONABLE GROUNDS TO SUSPECT THAT REMEDIAL WORK MAY BE REQUIRED, THE
AGENT SHALL NOTIFY BORROWER AND, THEREAFTER, MAY SELECT A CONSULTING ENGINEER TO
CONDUCT AND PREPARE REPORTS OF SUCH INSPECTIONS (WITH NOTICE TO BORROWER PRIOR
TO THE COMMENCEMENT OF SUCH INSPECTION). BORROWER SHALL BE GIVEN A REASONABLE
OPPORTUNITY TO REVIEW ANY REPORTS, DATA AND OTHER DOCUMENTS OR MATERIALS
REVIEWED OR PREPARED BY THE ENGINEER, AND TO SUBMIT COMMENTS AND SUGGESTED
REVISIONS OR REBUTTALS TO SAME. THE INSPECTION RIGHTS GRANTED TO THE AGENT IN
THIS SECTION 5.1(E) SHALL BE IN ADDITION TO, AND NOT IN LIMITATION OF, ANY OTHER
INSPECTION RIGHTS GRANTED TO THE AGENT IN THIS AGREEMENT, AND SHALL EXPRESSLY
INCLUDE THE RIGHT (IF THE AGENT REASONABLY SUSPECTS THAT REMEDIAL WORK MAY BE
REQUIRED) TO CONDUCT SOIL BORINGS,

 

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ESTABLISH GROUND WATER MONITORING WELLS AND CONDUCT OTHER CUSTOMARY
ENVIRONMENTAL TESTS, ASSESSMENTS AND AUDITS.

 

(III)         BORROWER AGREES TO BEAR AND SHALL PAY OR REIMBURSE THE LENDERS ON
DEMAND FOR ALL SUMS ADVANCED AND REASONABLE EXPENSES INCURRED (INCLUDING
REASONABLE ATTORNEYS’ FEES AND DISBURSEMENTS, BUT EXCLUDING INTERNAL OVERHEAD,
ADMINISTRATIVE AND SIMILAR COSTS OF THE LENDERS) REASONABLY RELATING TO, OR
INCURRED BY LENDERS IN CONNECTION WITH, THE INSPECTIONS AND REPORTS DESCRIBED IN
THIS SECTION 5.1(E) (TO THE EXTENT SUCH INSPECTIONS AND REPORTS RELATE TO THE
PROPERTY) IN THE FOLLOWING SITUATIONS:

 

(x)          If the Agent has reasonable grounds to believe, at the time any
such inspection is ordered, that there exists an occurrence or condition that
could lead to an Environmental Claim;

 

(y)          If any such inspection reveals an occurrence or condition that is
reasonably likely to lead to an Environmental Claim; or

 

(z)          If an Event of Default with respect to the Property exists at the
time any such inspection is ordered, and such Event of Default relates to any
representation, covenant or other obligation pertaining to Hazardous Substances,
Environmental Laws or any other environmental matter.

 

(F)            ENVIRONMENTAL NOTICES.  BORROWER SHALL PROMPTLY PROVIDE NOTICE TO
AGENT OF:

 

(I)           ANY ENVIRONMENTAL CLAIM ASSERTED BY ANY GOVERNMENTAL AUTHORITY
WITH RESPECT TO ANY HAZARDOUS SUBSTANCE ON, IN, UNDER OR EMANATING FROM THE
PROPERTY, WHICH MIGHT INVOLVE REMEDIATION COST OR LIABILITY GREATER THAN
$25,000;

 

(II)          ANY PROCEEDING, INVESTIGATION OR INQUIRY COMMENCED OR THREATENED
IN WRITING BY ANY GOVERNMENTAL AUTHORITY, AGAINST BORROWER, WITH RESPECT TO THE
PRESENCE, SUSPECTED PRESENCE, RELEASE OR THREATENED RELEASE OF HAZARDOUS
SUBSTANCES FROM OR ONTO, IN OR UNDER ANY PROPERTY NOT OWNED BY BORROWER
(INCLUDING, WITHOUT LIMITATION, PROCEEDINGS UNDER THE COMPREHENSIVE
ENVIRONMENTAL RESPONSE, COMPENSATION, AND LIABILITY ACT, AS AMENDED, 42 U.S.C.
§9601, ET SEQ.), WHICH MIGHT INVOLVE REMEDIATION COST OR LIABILITY GREATER THAN
$25,000;

 

(III)         ALL ENVIRONMENTAL CLAIMS ASSERTED OR THREATENED AGAINST BORROWER
WITH RESPECT TO THE PROPERTY, AGAINST ANY OTHER PARTY OCCUPYING THE PROPERTY OR
ANY PORTION THEREOF WHICH BECOME KNOWN TO BORROWER OR AGAINST THE PROPERTY,
WHICH MIGHT INVOLVE REMEDIATION COST OR LIABILITY GREATER THAN $25,000;

 

(IV)         THE DISCOVERY BY BORROWER OF ANY OCCURRENCE OR CONDITION ON THE
PROPERTY WHICH COULD INVOLVE REMEDIATION COST OR LIABILITY GREATER THAN $25,000;

 

(V)          THE COMMENCEMENT OR COMPLETION OF ANY REMEDIAL WORK, WHICH MIGHT
INVOLVE REMEDIATION COST OR LIABILITY GREATER THAN $25,000; AND

 

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(VI)         ANY OF THE FOREGOING CLAUSES (I)-(V) THAT A TENANT NOTIFIES TO
BORROWER UNDER A LEASE WITH RESPECT TO SUCH TENANT.

 

(G)           COPIES OF NOTICES.  BORROWER SHALL TRANSMIT TO THE AGENT COPIES OF
ANY CITATIONS, ORDERS, NOTICES OR OTHER WRITTEN COMMUNICATIONS RECEIVED FROM ANY
PERSON AND ANY NOTICES, REPORTS OR OTHER WRITTEN COMMUNICATIONS SUBMITTED TO ANY
GOVERNMENTAL AUTHORITY WITH RESPECT TO THE MATTERS DESCRIBED IN SECTION 5.1(F).

 

(H)           ENVIRONMENTAL CLAIMS.  THE AGENT MAY JOIN AND PARTICIPATE IN, AS A
PARTY IF THE AGENT SO DETERMINES, ANY LEGAL OR ADMINISTRATIVE PROCEEDING OR
ACTION CONCERNING THE PROPERTY OR ANY PORTION THEREOF UNDER ANY ENVIRONMENTAL
LAW, IF, IN THE AGENT’S REASONABLE JUDGMENT, THE INTERESTS OF THE LENDERS SHALL
NOT BE ADEQUATELY PROTECTED BY BORROWER; PROVIDED, HOWEVER, THAT THE LENDERS
SHALL NOT PARTICIPATE IN DAY-TO-DAY DECISION MAKING WITH RESPECT TO
ENVIRONMENTAL COMPLIANCE. BORROWER SHALL PAY OR REIMBURSE THE LENDERS ON DEMAND
FOR ALL REASONABLE SUMS ADVANCED AND REASONABLE EXPENSES INCURRED (INCLUDING
REASONABLE ATTORNEYS’ FEES AND DISBURSEMENTS, BUT EXCLUDING INTERNAL OVERHEAD,
ADMINISTRATIVE AND SIMILAR COSTS OF THE LENDERS) BY THE LENDERS IN CONNECTION
WITH ANY SUCH ACTION OR PROCEEDING.

 

(I)            ENVIRONMENTAL INDEMNIFICATION.  BORROWER SHALL INDEMNIFY,
REIMBURSE, DEFEND, AND HOLD HARMLESS THE AGENT, EACH LENDER, THE COLLATERAL
AGENT AND EACH OF ITS RESPECTIVE PARENTS, SUBSIDIARIES, AFFILIATES,
SHAREHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES, REPRESENTATIVES, AGENTS,
SUCCESSORS, ASSIGNS AND ATTORNEYS (COLLECTIVELY, THE “INDEMNIFIED PARTIES”) FOR,
FROM, AND AGAINST ALL DEMANDS, CLAIMS, ACTIONS OR CAUSES OF ACTION, ASSESSMENTS,
LOSSES, DAMAGES, LIABILITIES, COSTS AND EXPENSES (INCLUDING, WITHOUT LIMITATION,
INTEREST, PENALTIES, REASONABLE ATTORNEYS’ FEES, DISBURSEMENTS AND EXPENSES, AND
REASONABLE CONSULTANTS’ FEES, DISBURSEMENTS AND EXPENSES (BUT EXCLUDING INTERNAL
OVERHEAD, ADMINISTRATIVE, LOST OPPORTUNITY AND SIMILAR COSTS OF THE LENDERS AND
THE COLLATERAL AGENT)), ASSERTED AGAINST, RESULTING TO, IMPOSED ON, OR INCURRED
BY ANY INDEMNIFIED PARTY, DIRECTLY OR INDIRECTLY, IN CONNECTION WITH ANY OF THE
FOLLOWING (EXCEPT TO THE EXTENT SAME ARE DIRECTLY AND SOLELY CAUSED BY THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY INDEMNIFIED PARTY AND EXCEPT THAT ANY
INDEMNIFIED PARTY SHALL NOT BE INDEMNIFIED AGAINST CLAIMS RESULTING FROM ACTIONS
TAKEN OR EVENTS OCCURRING WITH RESPECT TO THE PROPERTY AFTER THE AGENT
FORECLOSES ITS LIEN OR SECURITY INTEREST UPON THE PROPERTY OR ACCEPTS A DEED IN
LIEU OF FORECLOSURE OR IS A SO-CALLED “MORTGAGEE-IN-POSSESSION” UNLESS AND TO
THE EXTENT SUCH INDEMNIFICATION RELATES TO ANY OF THE FOLLOWING WHICH OCCURRED
WHILE BORROWER OWNED THE PROPERTY):

 

(a)           events, circumstances, or conditions which form the reasonable
basis for an Environmental Claim;

 

(b)           any pollution or threat to human health or the environment that is
related in any way to Borrower’s or any previous owner’s or operator’s
management, use, control, ownership or operation of the Property (including,
without limitation, all on-site and off-site activities involving Hazardous
Substances), and whether occurring, existing or arising prior to or from and
after the date hereof, and whether or not the pollution or threat to human
health or the environment is described in the Environmental Reports;

 

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(c)           any Environmental Claim against any Person whose liability for
such Environmental Claim Borrower has or may have assumed or retained either
contractually or by operation of law; or

 

(d)           the breach of any representation, warranty or covenant set forth
in Section 4.2(e) and Sections 5.1(d) through 5.1(i), inclusive.

 

The provisions of and undertakings and indemnification set forth in this
Section 5.1(i) shall survive the satisfaction and payment of the Indebtedness
and termination of this Agreement.

 

(J)            GENERAL INDEMNITY.

 

(I)           BORROWER SHALL, AT ITS SOLE COST AND EXPENSE, PROTECT, DEFEND,
INDEMNIFY, RELEASE AND HOLD HARMLESS THE INDEMNIFIED PARTIES FOR, FROM AND
AGAINST ANY AND ALL CLAIMS, SUITS, LIABILITIES (INCLUDING, WITHOUT LIMITATION,
STRICT LIABILITIES), ADMINISTRATIVE AND JUDICIAL ACTIONS AND PROCEEDINGS,
OBLIGATIONS, DEBTS, DAMAGES, LOSSES, COSTS, EXPENSES, FINES, PENALTIES, CHARGES,
FEES, EXPENSES, JUDGMENTS, AWARDS, AMOUNTS PAID IN SETTLEMENT, AND LITIGATION
COSTS, OF WHATEVER KIND OR NATURE AND WHETHER OR NOT INCURRED IN CONNECTION WITH
ANY JUDICIAL OR ADMINISTRATIVE PROCEEDINGS (INCLUDING, BUT NOT LIMITED TO,
REASONABLE ATTORNEYS’ FEES AND OTHER REASONABLE COSTS OF DEFENSE) (THE “LOSSES”)
IMPOSED UPON OR INCURRED BY OR ASSERTED AGAINST ANY INDEMNIFIED PARTIES (EXCEPT
TO THE EXTENT SAME ARE DIRECTLY AND SOLELY CAUSED BY THE GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT OF ANY INDEMNIFIED PARTY) AND DIRECTLY OR INDIRECTLY ARISING
OUT OF OR IN ANY WAY RELATING TO ANY ONE OR MORE OF THE FOLLOWING:

 

(A)         OWNERSHIP OF THE NOTE, ANY OF THE OTHER LOAN DOCUMENTS OR THE
PROPERTY OR ANY INTEREST THEREIN OR RECEIPT OF ANY RENTS OR ACCOUNTS;

 

(B)         ANY UNTRUE STATEMENT OF ANY MATERIAL FACT CONTAINED IN ANY
INFORMATION PROVIDED BY BORROWER, THE PROPERTY OR THE LOAN OR THE OMISSION TO
STATE THEREIN A MATERIAL FACT REQUIRED TO BE STATED IN SUCH INFORMATION OR
NECESSARY IN ORDER TO MAKE THE STATEMENTS IN SUCH INFORMATION OR IN LIGHT OF THE
CIRCUMSTANCES UNDER WHICH THEY WERE MADE NOT MISLEADING;

 

(C)         ANY AND ALL LAWFUL ACTION THAT MAY BE TAKEN AND IS TAKEN BY THE
LENDER IN CONNECTION WITH THE ENFORCEMENT OF THE PROVISIONS OF THIS AGREEMENT,
THE NOTE OR ANY OF THE OTHER LOAN DOCUMENTS, WHETHER OR NOT SUIT IS FILED IN
CONNECTION WITH SAME, OR IN CONNECTION WITH BORROWER OR ANY AFFILIATE OF
BORROWER BECOMING A PARTY TO A VOLUNTARY OR INVOLUNTARY FEDERAL OR STATE
BANKRUPTCY, INSOLVENCY OR SIMILAR PROCEEDING;

 

(D)         ANY ACCIDENT, INJURY TO OR DEATH OF PERSONS OR LOSS OF OR DAMAGE TO
PROPERTY OCCURRING IN, ON OR ABOUT THE PROPERTY OR ANY PART THEREOF OR ON THE
ADJOINING SIDEWALKS, CURBS, ADJACENT PROPERTY OR ADJACENT PARKING AREAS, STREETS
OR WAYS;

 

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(E)          ANY USE, NONUSE OR CONDITION IN, ON OR ABOUT THE PROPERTY OR ANY
PART THEREOF OR ON THE ADJOINING SIDEWALKS, CURBS, ADJACENT PROPERTY OR ADJACENT
PARKING AREAS, STREETS OR WAYS;

 

(F)          ANY FAILURE ON THE PART OF BORROWER TO PERFORM OR BE IN COMPLIANCE
WITH ANY OF THE TERMS OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS;

 

(G)         PERFORMANCE OF ANY LABOR OR SERVICES OR THE FURNISHING OF ANY
MATERIALS OR OTHER PROPERTY IN RESPECT OF THE PROPERTY OR ANY PART THEREOF
PURSUANT TO PROVISIONS OF THIS AGREEMENT;

 

(H)         THE FAILURE OF BORROWER TO FILE TIMELY WITH THE INTERNAL REVENUE
SERVICE AN ACCURATE FORM 1099-B, STATEMENT FOR RECIPIENTS OF PROCEEDS FROM REAL
ESTATE, BROKER AND BARTER EXCHANGE TRANSACTIONS, WHICH MAY BE REQUIRED IN
CONNECTION WITH THIS AGREEMENT;

 

(I)           ANY FAILURE OF THE PROPERTY TO BE IN COMPLIANCE WITH ANY LEGAL
REQUIREMENT;

 

(J)          THE ENFORCEMENT BY ANY INDEMNIFIED PARTY OF THE PROVISIONS OF THIS
SECTION 5.1(J); AND

 

(K)         ANY AND ALL CLAIMS AND DEMANDS WHATSOEVER WHICH MAY BE ASSERTED
AGAINST THE LENDERS BY REASON OF ANY ALLEGED OBLIGATIONS OR UNDERTAKINGS ON ITS
PART TO PERFORM OR DISCHARGE ANY OF THE TERMS, COVENANTS, OR AGREEMENTS
CONTAINED IN ANY LEASE.

 

Any amounts payable to an Indemnified Party by reason of the application of this
Section 5.1(j)(i) shall become due and payable ten (10) days after written
demand and shall bear interest at the Default Rate from the tenth (10th) day
after demand until paid.

 

(II)           BORROWER SHALL, AT ITS SOLE COST AND EXPENSE, PROTECT, DEFEND,
INDEMNIFY, RELEASE AND HOLD HARMLESS THE INDEMNIFIED PARTIES FROM AND AGAINST
ANY AND ALL LOSSES IMPOSED UPON OR INCURRED BY OR ASSERTED AGAINST ANY OF THE
INDEMNIFIED PARTIES AND DIRECTLY OR INDIRECTLY ARISING OUT OF OR IN ANY WAY
RELATING TO ANY TAX ON THE MAKING AND/OR RECORDING OF THIS AGREEMENT, THE NOTE
OR ANY OF THE OTHER LOAN DOCUMENTS.

 

(III)          BORROWER SHALL, AT ITS SOLE COST AND EXPENSE, PROTECT, DEFEND,
INDEMNIFY, RELEASE AND HOLD HARMLESS THE INDEMNIFIED PARTIES FROM AND AGAINST
ANY AND ALL LOSSES (INCLUDING, WITHOUT LIMITATION, REASONABLE ATTORNEYS’ FEES
AND COSTS INCURRED IN THE INVESTIGATION, DEFENSE, AND SETTLEMENT OF 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 REQUIRED, IN THE LENDER’S REASONABLE DISCRETION) THAT THE
INDEMNIFIED PARTIES MAY INCUR, DIRECTLY OR INDIRECTLY, AS A RESULT OF A DEFAULT
UNDER BORROWER’S COVENANTS WITH RESPECT TO ERISA AND EMPLOYEE BENEFITS PLANS
CONTAINED HEREIN.

 

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(IV)          PROMPTLY AFTER RECEIPT BY AN INDEMNIFIED PARTY UNDER THIS
SECTION 5.1(J) OF NOTICE OF THE MAKING OF ANY CLAIM OR THE COMMENCEMENT OF ANY
ACTION, SUCH INDEMNIFIED PARTY SHALL, IF A CLAIM IN RESPECT THEREOF IS TO BE
MADE BY SUCH INDEMNIFIED PARTY AGAINST BORROWER UNDER THIS SECTION 5.1(J),
NOTIFY BORROWER IN WRITING, BUT THE OMISSION SO TO NOTIFY BORROWER WILL NOT
RELIEVE BORROWER FROM ANY LIABILITY WHICH IT MAY HAVE TO ANY INDEMNIFIED PARTY
UNDER THIS SECTION 5.16) OR OTHERWISE UNLESS AND TO THE EXTENT THAT BORROWER DID
NOT OTHERWISE POSSESS KNOWLEDGE OF SUCH CLAIM OR ACTION AND SUCH FAILURE
RESULTED IN THE FORFEITURE BY BORROWER OF SUBSTANTIAL RIGHTS AND DEFENSES. IN
CASE ANY SUCH CLAIM IS MADE OR ACTION IS BROUGHT AGAINST ANY INDEMNIFIED PARTY
AND SUCH INDEMNIFIED PARTY SEEKS OR INTENDS TO SEEK INDEMNITY FROM BORROWER,
BORROWER WILL BE ENTITLED TO PARTICIPATE IN, AND, TO THE EXTENT THAT IT MAY
WISH, TO ASSUME THE DEFENSE THEREOF WITH COUNSEL REASONABLY SATISFACTORY TO THE
INDEMNIFIED PARTY; AND, UPON RECEIPT OF NOTICE FROM BORROWER TO SUCH INDEMNIFIED
PARTY OF ITS ELECTION SO TO ASSUME THE DEFENSE OF SUCH CLAIM OR ACTION AND ONLY
UPON APPROVAL BY THE INDEMNIFIED PARTY OF SUCH COUNSEL (SUCH APPROVAL NOT TO BE
UNREASONABLY WITHHELD OR DELAYED), BORROWER WILL NOT BE LIABLE TO SUCH
INDEMNIFIED PARTY UNDER THIS SECTION 5.1(J) FOR ANY LEGAL OR OTHER EXPENSES
SUBSEQUENTLY INCURRED BY SUCH INDEMNIFIED PARTY IN CONNECTION WITH THE DEFENSE
THEREOF. NOTWITHSTANDING THE PRECEDING SENTENCE, EACH INDEMNIFIED PARTY WILL BE
ENTITLED TO EMPLOY COUNSEL SEPARATE FROM SUCH COUNSEL FOR BORROWER AND FROM ANY
OTHER PARTY IN SUCH ACTION IF SUCH INDEMNIFIED PARTY REASONABLY DETERMINES THAT
A CONFLICT OF INTEREST EXISTS WHICH MAKES REPRESENTATION BY COUNSEL CHOSEN BY
BORROWER NOT ADVISABLE. IN SUCH EVENT, BORROWER SHALL PAY THE REASONABLE FEES
AND DISBURSEMENTS OF SUCH SEPARATE COUNSEL, SUBJECT TO REIMBURSEMENT OF SUCH
COSTS IF THE INDEMNIFIED PARTY REQUIRING SUCH SEPARATE COUNSEL IS FOUND NOT TO
BE ENTITLED TO THE INDEMNITY PROTECTION OF THIS SECTION 5.1(J). BORROWER SHALL
NOT, WITHOUT THE PRIOR WRITTEN CONSENT OF AN INDEMNIFIED PARTY, SETTLE OR
COMPROMISE OR CONSENT TO THE ENTRY OF ANY JUDGMENT WITH RESPECT TO ANY PENDING
OR THREATENED CLAIM, ACTION, SUIT OR PROCEEDING IN RESPECT OF WHICH
INDEMNIFICATION MAY BE SOUGHT HEREUNDER (WHETHER OR NOT SUCH INDEMNIFIED PARTY
IS AN ACTUAL OR POTENTIAL PARTY TO SUCH CLAIM OR ACTION) UNLESS SUCH SETTLEMENT,
COMPROMISE OR CONSENT INCLUDES AN UNCONDITIONAL RELEASE OF EACH INDEMNIFIED
PARTY FROM ALL LIABILITY ARISING OUT OF SUCH CLAIM, ACTION, SUIT OR PROCEEDING.
EACH INDEMNIFIED PARTY SHALL NOT ENTER INTO A SETTLEMENT OF OR CONSENT TO THE
ENTRY OF ANY JUDGMENT WITH RESPECT TO ANY ACTION, CLAIM, SUIT OR PROCEEDING AS
TO WHICH AN INDEMNIFIED PARTY WOULD BE ENTITLED TO INDEMNIFICATION HEREUNDER
WITHOUT THE PRIOR WRITTEN CONSENT OF BORROWER.

 

The provisions of and undertakings and indemnification set forth in this
Section 5.1(j) shall survive the satisfaction and payment of the Indebtedness
and termination of this Agreement.

 

(K)           ACCESS TO PROPERTY.  BORROWER SHALL PERMIT AGENTS, REPRESENTATIVES
AND EMPLOYEES OF THE AGENT TO INSPECT THE PROPERTY OR ANY PART THEREOF AT SUCH
REASONABLE TIMES AS MAY BE REQUESTED BY AGENT UPON REASONABLE ADVANCE WRITTEN
NOTICE, SUBJECT, HOWEVER, TO THE RIGHTS OF BORROWER AND OF THE TENANTS OF THE
PROPERTY.

 

(L)            NOTICE OF DEFAULT.  BORROWER SHALL PROMPTLY ADVISE AGENT IN
WRITING OF ANY CHANGE IN BORROWER’S CONDITION, FINANCIAL OR OTHERWISE, THAT IS
REASONABLY LIKELY TO HAVE A MATERIAL ADVERSE EFFECT, OR OF THE OCCURRENCE OF ANY
DEFAULT OR EVENT OF DEFAULT.

 

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(M)          COOPERATE IN LEGAL PROCEEDINGS.  EXCEPT WITH RESPECT TO ANY CLAIM
BY BORROWER OR THE GUARANTOR AGAINST THE AGENT OR ANY LENDER, BORROWER SHALL
REASONABLY COOPERATE WITH AGENT WITH RESPECT TO ANY PROCEEDINGS BEFORE ANY
GOVERNMENTAL AUTHORITY THAT ARE REASONABLY LIKELY TO IN ANY WAY MATERIALLY
AFFECT THE RIGHTS OF THE LENDERS HEREUNDER OR ANY RIGHTS OBTAINED BY THE LENDERS
UNDER ANY OF THE LOAN DOCUMENTS AND, IN CONNECTION THEREWITH, SHALL NOT PROHIBIT
AGENT, AT ITS ELECTION, FROM PARTICIPATING IN ANY SUCH PROCEEDINGS.

 

(N)           PERFORM LOAN DOCUMENTS.  BORROWER SHALL OBSERVE, PERFORM AND
SATISFY ALL THE TERMS, PROVISIONS, COVENANTS AND CONDITIONS REQUIRED TO BE
OBSERVED, PERFORMED OR SATISFIED BY IT, AND SHALL PAY WHEN DUE ALL COSTS, FEES
AND EXPENSES REQUIRED TO BE PAID BY IT, UNDER THE LOAN DOCUMENTS.

 

(O)           INSURANCE BENEFITS.  BORROWER SHALL REASONABLY COOPERATE WITH
AGENT IN OBTAINING FOR THE LENDERS THE BENEFITS OF ANY INSURANCE PROCEEDS
LAWFULLY OR EQUITABLY PAYABLE TO BORROWER OR LENDERS IN CONNECTION WITH THE
PROPERTY. AGENT SHALL BE REIMBURSED FOR ANY EXPENSES REASONABLY INCURRED IN
CONNECTION THEREWITH (INCLUDING REASONABLE ATTORNEYS’ FEES AND DISBURSEMENTS,
BUT EXCLUDING INTERNAL OVERHEAD, ADMINISTRATIVE AND SIMILAR COSTS OF AGENT) OUT
OF SUCH INSURANCE PROCEEDS, ALL AS MORE SPECIFICALLY PROVIDED IN THIS AGREEMENT.

 

(P)           FURTHER ASSURANCES.  BORROWER SHALL, AT BORROWER’S SOLE COST AND
EXPENSE:

 

(I)           UPON AGENT’S REASONABLE REQUEST THEREFOR GIVEN FROM TIME TO TIME,
PAY FOR (A) REPORTS OF UCC, TAX LIEN, JUDGMENT AND LITIGATION SEARCHES WITH
RESPECT TO BORROWER, AND (B) SEARCHES OF TITLE TO THE PROPERTY, EACH SUCH SEARCH
TO BE CONDUCTED BY SEARCH FIRMS DESIGNATED BY AGENT IN EACH OF THE LOCATIONS
DESIGNATED BY AGENT;

 

(II)          FURNISH TO AGENT ALL INSTRUMENTS, DOCUMENTS, CERTIFICATES, TITLE
AND OTHER INSURANCE REPORTS AND AGREEMENTS, AND EACH AND EVERY OTHER DOCUMENT,
CERTIFICATE, AGREEMENT AND INSTRUMENT REQUIRED TO BE FURNISHED PURSUANT TO THE
TERMS OF THE LOAN DOCUMENTS;

 

(III)         EXECUTE AND DELIVER TO AGENT SUCH DOCUMENTS, INSTRUMENTS,
CERTIFICATES, ASSIGNMENTS AND OTHER WRITINGS, AND DO SUCH OTHER ACTS NECESSARY,
TO EVIDENCE, PRESERVE AND/OR PROTECT THE COLLATERAL AT ANY TIME SECURING OR
INTENDED TO SECURE THE NOTE, AS AGENT MAY REASONABLY REQUIRE (INCLUDING, WITHOUT
LIMITATION, TENANT ESTOPPEL CERTIFICATES, AN AMENDED OR REPLACEMENT MORTGAGE,
UCC FINANCING STATEMENTS OR COLLATERAL SECURITY INSTRUMENTS); AND

 

(IV)         DO AND EXECUTE ALL AND SUCH FURTHER LAWFUL AND REASONABLE ACTS,
CONVEYANCES AND ASSURANCES FOR THE BETTER AND MORE EFFECTIVE CARRYING OUT OF THE
INTENTS AND PURPOSES OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS AGENT
SHALL REASONABLY REQUIRE FROM TIME TO TIME.

 

(Q)           MANAGEMENT OF PROPERTY.

 

(I)           THE PROPERTY SHALL BE MANAGED AT ALL TIMES BY THE MANAGER OR
ANOTHER MANAGER REASONABLY SATISFACTORY TO AGENT, PURSUANT TO A MANAGEMENT
AGREEMENT.

 

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ANY SUCH MANAGER MAY BE AN AFFILIATE OF BORROWER, PROVIDED THAT:  (A) THE TERMS
AND CONDITIONS OF SUCH MANAGER’S ENGAGEMENT ARE AT ARM’S LENGTH, REASONABLE,
COMPETITIVE AND CUSTOMARY IN THE APPLICABLE MARKETPLACE; AND (B) AGENT HAS
APPROVED SUCH MANAGER AND SUCH TERMS, WHICH APPROVAL SHALL NOT BE UNREASONABLY
WITHHELD OR DELAYED. BORROWER SHALL CAUSE THE MANAGER OF THE PROPERTY TO AGREE
THAT SUCH MANAGER’S MANAGEMENT AGREEMENT IS SUBJECT AND SUBORDINATE IN ALL
RESPECTS TO THE LIEN OF THE MORTGAGE. A MANAGEMENT AGREEMENT MAY BE TERMINATED
(1) BY BORROWER AT ANY TIME IN ACCORDANCE WITH THE PROVISIONS OF SUCH MANAGEMENT
AGREEMENT SO LONG AS A SUCCESSOR MANAGER AS SPECIFIED BELOW SHALL HAVE BEEN
APPOINTED AND SUCH SUCCESSOR MANAGER HAS (I) ENTERED INTO A MANAGEMENT
AGREEMENT, SUBJECT TO ANY MODIFICATIONS APPROVED BY AGENT, WHICH APPROVAL SHALL
NOT BE UNREASONABLY DENIED, CONDITIONED OR DELAYED, AND (II) HAS EXECUTED AND
DELIVERED THE MANAGER’S SUBORDINATION TO AGENT, AND (2) BY AGENT UPON THIRTY
(30) DAYS’ PRIOR WRITTEN NOTICE TO BORROWER AND THE MANAGER (A) UPON THE
OCCURRENCE AND CONTINUATION OF AN EVENT OF DEFAULT OR (B) IF THE MANAGER COMMITS
ANY ACT WHICH WOULD PERMIT TERMINATION UNDER THE MANAGEMENT AGREEMENT (SUBJECT
TO ANY APPLICABLE NOTICE, GRACE AND CURE PERIODS PROVIDED IN THE MANAGEMENT
AGREEMENT). BORROWER MAY FROM TIME TO TIME APPOINT A SUCCESSOR MANAGER TO MANAGE
THE PROPERTY WITH AGENT’S PRIOR WRITTEN CONSENT, SUCH CONSENT NOT TO BE
UNREASONABLY WITHHELD. NOTWITHSTANDING THE FOREGOING, ANY SUCCESSOR MANAGER
SELECTED HEREUNDER BY AGENT OR BORROWER TO MANAGE THE PROPERTY SHALL BE A
REPUTABLE MANAGEMENT COMPANY HAVING SUBSTANTIAL EXPERIENCE IN THE MANAGEMENT OF
REAL PROPERTY OF A SIMILAR TYPE, SIZE AND QUALITY IN THE STATE IN WHICH THE
PROPERTY IS LOCATED. BORROWER FURTHER COVENANTS AND AGREES THAT ANY MANAGER OF
PROPERTY SHALL AT ALL TIMES WHILE ANY INDEBTEDNESS IS OUTSTANDING MAINTAIN
WORKER’S COMPENSATION INSURANCE AS REQUIRED BY GOVERNMENTAL AUTHORITIES.

 

(II)          BORROWER FURTHER COVENANTS AND AGREES THAT THE PROPERTY SHALL BE
OPERATED PURSUANT TO THE MANAGEMENT AGREEMENT AND THAT BORROWER SHALL: 
(W) PROMPTLY PERFORM AND/OR OBSERVE ALL OF THE MATERIAL COVENANTS AND AGREEMENTS
REQUIRED TO BE PERFORMED AND OBSERVED BY IT UNDER THE MANAGEMENT AGREEMENT AND
DO ALL THINGS REASONABLY NECESSARY TO PRESERVE AND TO KEEP UNIMPAIRED ITS
MATERIAL RIGHTS THEREUNDER; (X) PROMPTLY NOTIFY THE AGENT OF ANY MATERIAL
DEFAULT UNDER THE MANAGEMENT AGREEMENT OF WHICH IT IS AWARE; (Y) PROMPTLY
DELIVER TO THE AGENT A COPY OF EACH FINANCIAL STATEMENT, BUSINESS PLAN, CAPITAL
EXPENDITURES PLAN, NOTICE AND REPORT RECEIVED BY IT UNDER THE MANAGEMENT
AGREEMENT, INCLUDING, BUT NOT LIMITED TO, FINANCIAL STATEMENTS; AND (Z) PROMPTLY
ENFORCE THE PERFORMANCE AND OBSERVANCE OF THE COVENANTS AND AGREEMENTS REQUIRED
TO BE PERFORMED AND/OR OBSERVED BY THE MANAGER UNDER THE MANAGEMENT AGREEMENT.

 

(R)            FINANCIAL REPORTING.

 

(I)            BORROWER SHALL KEEP AND MAINTAIN OR SHALL CAUSE TO BE KEPT AND
MAINTAINED ON A FISCAL YEAR BASIS IN ACCORDANCE WITH GAAP CONSISTENTLY APPLIED,
BOOKS, RECORDS AND ACCOUNTS REFLECTING IN REASONABLE DETAIL ALL OF THE FINANCIAL
AFFAIRS OF BORROWER AND ALL ITEMS OF INCOME AND EXPENSE IN CONNECTION WITH THE
OPERATION OF THE PROPERTY AND OWNERSHIP OF THE PROPERTY AND IN CONNECTION WITH
ANY SERVICES, EQUIPMENT OR FURNISHINGS PROVIDED IN CONNECTION WITH THE OPERATION
OF THE PROPERTY, WHETHER SUCH INCOME OR EXPENSE MAY BE REALIZED BY BORROWER OR
BY ANY OTHER PERSON WHATSOEVER.

 

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AGENT SHALL HAVE THE RIGHT FROM TIME TO TIME AT ALL TIMES DURING NORMAL BUSINESS
HOURS UPON REASONABLE PRIOR WRITTEN NOTICE TO BORROWER TO EXAMINE SUCH BOOKS,
RECORDS AND ACCOUNTS AT THE OFFICE OF BORROWER OR OTHER PERSON MAINTAINING SUCH
BOOKS, RECORDS AND ACCOUNTS AND TO MAKE SUCH COPIES OR EXTRACTS THEREOF AS AGENT
SHALL DESIRE. DURING THE CONTINUATION OF AN EVENT OF DEFAULT (INCLUDING, WITHOUT
LIMITATION, AN EVENT OF DEFAULT RESULTING FROM THE FAILURE OF THE BORROWER TO
DELIVER ANY OF THE FINANCIAL INFORMATION REQUIRED TO BE DELIVERED PURSUANT TO
THIS SECTION 5.1(R)), BORROWER SHALL PAY ANY REASONABLE COSTS AND EXPENSES
INCURRED BY AGENT TO EXAMINE BORROWERS’ ACCOUNTING RECORDS, AS AGENT SHALL
REASONABLY DETERMINE TO BE NECESSARY OR APPROPRIATE IN THE PROTECTION OF THE
LENDERS’ INTEREST.

 

(II)           BORROWER SHALL FURNISH TO AGENT ANNUALLY, WITHIN ONE HUNDRED
TWENTY (120) DAYS FOLLOWING THE END OF EACH FISCAL YEAR, A COMPLETE COPY OF
BORROWER’S UNAUDITED FINANCIAL STATEMENT IN ACCORDANCE WITH GAAP CONSISTENTLY
APPLIED (WHICH MAY BE PREPARED INTERNALLY) COVERING BORROWER’S FINANCIAL
POSITION AND RESULTS OF OPERATIONS, FOR SUCH FISCAL YEAR AND CONTAINING A
STATEMENT OF REVENUES AND EXPENSES, A STATEMENT OF ASSETS AND LIABILITIES AND A
STATEMENT OF BORROWER’S EQUITY, ALL OF WHICH SHALL BE IN FORM AND SUBSTANCE
REASONABLY ACCEPTABLE TO AGENT. AGENT SHALL HAVE THE RIGHT FROM TIME TO TIME TO
REVIEW AND CONSULT WITH RESPECT TO THE ACCOUNTING PROCEDURES USED IN THE
PREPARATION OF SUCH ANNUAL FINANCIAL STATEMENTS. TOGETHER WITH BORROWER’S ANNUAL
FINANCIAL STATEMENTS, BORROWER SHALL FURNISH TO AGENT AN OFFICER’S CERTIFICATE
CERTIFYING AS OF THE DATE THEREOF (X) THAT THE ANNUAL FINANCIAL STATEMENTS
PRESENT FAIRLY IN ALL MATERIAL RESPECTS THE RESULTS OF OPERATIONS AND FINANCIAL
CONDITION OF BORROWER ALL IN ACCORDANCE WITH GAAP CONSISTENTLY APPLIED, AND
(Y) WHETHER THERE EXISTS AN EVENT OF DEFAULT OR DEFAULT, AND IF SUCH EVENT OF
DEFAULT OR DEFAULT EXISTS, THE NATURE THEREOF, THE PERIOD OF TIME IT HAS EXISTED
AND THE ACTION THEN BEING TAKEN TO REMEDY SAME.

 

(III)          BORROWER SHALL FURNISH TO AGENT, WITHIN SIXTY (60) DAYS FOLLOWING
THE END OF EACH FISCAL YEAR QUARTER A TRUE, COMPLETE AND CORRECT QUARTERLY
UNAUDITED FINANCIAL STATEMENT PREPARED IN ACCORDANCE WITH GAAP WITH RESPECT TO
BORROWER FOR THE PORTION OF THE FISCAL YEAR THEN ENDED.

 

(IV)          BORROWER SHALL FURNISH TO AGENT, WITHIN THIRTY (30) BUSINESS DAYS
AFTER REQUEST, SUCH FURTHER INFORMATION WITH RESPECT TO THE OPERATION OF THE
PROPERTY AND THE FINANCIAL AFFAIRS OF BORROWER AS MAY BE REASONABLY REQUESTED BY
AGENT, INCLUDING ALL BUSINESS PLANS PREPARED FOR BORROWER.

 

(V)           BORROWER SHALL FURNISH TO AGENT, WITHIN THIRTY (30) BUSINESS DAYS
AFTER REQUEST, SUCH FURTHER INFORMATION REGARDING ANY PLAN OR MULTIEMPLOYER PLAN
AND ANY REPORTS OR OTHER INFORMATION REQUIRED TO BE FILED UNDER ERISA AS MAY BE
REASONABLY REQUESTED BY AGENT IN WRITING.

 

(VI)          AT LEAST THIRTY (30) DAYS PRIOR TO THE END OF EACH OF BORROWER’S
FISCAL YEARS, BORROWER SHALL SUBMIT OR CAUSE TO BE SUBMITTED TO AGENT FOR ITS
APPROVAL, SUCH APPROVAL NOT TO BE UNREASONABLY WITHHELD OR DELAYED, AN OPERATING
BUDGET FOR PROPERTY EXPENSES, CAPITAL IMPROVEMENT COSTS, LEASING COMMISSIONS, TI
COSTS AND REPLACEMENT RESERVE COSTS FOR THE NEXT FISCAL YEAR FOR THE PROPERTY.
UNTIL SO APPROVED BY

 

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AGENT FOR THE SUBSEQUENT FISCAL YEAR, THE OPERATING BUDGET APPROVED BY AGENT FOR
THE PRECEDING FISCAL YEAR SHALL REMAIN IN EFFECT FOR PURPOSES OF SECTION 3.12;
PROVIDED, THAT FOR SO LONG AS SUCH PRIOR OPERATING BUDGET REMAINS IN EFFECT,
AMOUNTS SET FORTH IN THE PRIOR OPERATING BUDGET WITH RESPECT TO PROPERTY
EXPENSES, TI COSTS AND LEASING COMMISSIONS SHALL BE DEEMED INCREASED ON A
PERCENTAGE BASIS BY AN AMOUNT EQUAL TO THE GREATER OF (X) ACTUAL INCREASES THEN
KNOWN TO BORROWER AND (Y) THE INCREASE IN THE CONSUMER PRICE INDEX (EXPRESSED AS
A PERCENTAGE) AS MEASURED OVER THE CALENDAR YEAR THAT THE PRIOR OPERATING BUDGET
WAS IN EFFECT.

 

(VII)         NO LATER THAN THIRTY (30) DAYS FOLLOWING THE END OF EACH CALENDAR
QUARTER, BEGINNING WITH THE FIRST CALENDAR QUARTER END AFTER THE RELATED ADVANCE
CLOSING DATE, BORROWER SHALL PREPARE AND DELIVER TO THE AGENT AND THE COLLATERAL
AGENT A STATEMENT (EACH A “QUARTERLY STATEMENT”) IN HARD COPY AND ON DISKETTE
AND/OR A COPY THROUGH ELECTRONIC MAIL, IN FORM AND SUBSTANCE REASONABLY
SATISFACTORY TO AGENT, SETTING FORTH WITH RESPECT TO THE RELATED PROPERTY,

 

(A)         A RENT ROLL DATED AS OF THE LAST DAY OF SUCH QUARTER IN A FORM
ACCEPTABLE TO THE AGENT, IDENTIFYING EACH OF THE LEASES AND CONTAINING ANY
INFORMATION REASONABLY REQUIRED BY AGENT; AND

 

(B)         MONTHLY AND YEAR-TO-DATE OPERATING STATEMENTS PREPARED FOR EACH
CALENDAR MONTH DURING EACH SUCH QUARTER, EACH OF WHICH SHALL INCLUDE AN
ITEMIZATION OF ACTUAL (NOT PRO FORMA) CAPITAL EXPENDITURES DURING THE APPLICABLE
PERIOD.

 

(S)           OPERATION OF PROPERTY.  BORROWER SHALL CAUSE THE OPERATION OF THE
PROPERTY TO BE CONDUCTED AT ALL TIMES IN A MANNER CONSISTENT WITH AT LEAST THE
LEVEL OF OPERATION OF THE PROPERTY AS OF THE CLOSING DATE, INCLUDING, WITHOUT
LIMITATION, THE FOLLOWING:

 

(I)            TO MAINTAIN OR CAUSE TO BE MAINTAINED THE STANDARD OF THE
PROPERTY AT ALL TIMES AT A LEVEL NOT LOWER THAN THAT MAINTAINED BY PRUDENT
MANAGERS OF SIMILAR FACILITIES OR LAND IN THE REGION WHERE THE PROPERTY IS
LOCATED; AND

 

(II)           TO OPERATE OR CAUSE TO BE OPERATED THE PROPERTY IN A PRUDENT
MANNER IN COMPLIANCE IN ALL MATERIAL RESPECTS WITH APPLICABLE LEGAL REQUIREMENTS
AND INSURANCE REQUIREMENTS RELATING THERETO AND MAINTAIN OR CAUSE TO BE
MAINTAINED ALL LICENSES, PERMITS AND ANY OTHER AGREEMENTS NECESSARY FOR THE
CONTINUED USE AND OPERATION OF THE PROPERTY.

 

(T)            SINGLE-PURPOSE ENTITY.

 

(I)           BORROWER AT ALL TIMES WILL CONTINUE TO BE A DULY FORMED AND
VALIDLY EXISTING LIMITED LIABILITY COMPANY, OR AS THE CASE MAY BE, A LIMITED
PARTNERSHIP UNDER THE LAWS OF THE STATE OF ITS FORMATION AND A SINGLE-PURPOSE
ENTITY.

 

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(II)           BORROWER SHALL AT ALL TIMES COMPLY WITH THE PROVISIONS OF ITS
ORGANIZATIONAL AGREEMENT AND THE LAWS OF THE STATE OF ITS FORMATION RELATING TO
LIMITED LIABILITY COMPANIES OR, AS THE CASE MAY BE, LIMITED PARTNERSHIPS.

 

(III)          BORROWER SHALL OBSERVE ALL CUSTOMARY FORMALITIES REGARDING ITS
EXISTENCE.

 

(IV)         BORROWER SHALL ACCURATELY MAINTAIN ITS FINANCIAL STATEMENTS,
ACCOUNTING RECORDS AND OTHER CORPORATE DOCUMENTS SEPARATE FROM THOSE OF ITS
MEMBERS, AFFILIATES OF ITS MEMBERS AND ANY OTHER PERSON. BORROWER SHALL NOT
COMMINGLE ITS ASSETS WITH THOSE OF ITS MEMBERS, ANY AFFILIATES OF ITS MEMBERS,
OR ANY OTHER PERSON. BORROWER SHALL CONTINUE TO ACCURATELY MAINTAIN ITS OWN BANK
ACCOUNTS AND SEPARATE BOOKS OF ACCOUNT.

 

(V)          BORROWER SHALL CONTINUE TO PAY ITS OWN LIABILITIES FROM ITS OWN
SEPARATE ASSETS.

 

(VI)         BORROWER SHALL CONTINUE TO IDENTIFY ITSELF IN ALL DEALINGS WITH THE
PUBLIC, UNDER ITS OWN NAME OR TRADE NAMES AND AS A SEPARATE AND DISTINCT ENTITY.
BORROWER WILL NOT IDENTIFY ITSELF AS BEING A DIVISION OR A PART OF ANY OTHER
ENTITY. BORROWER WILL NOT IDENTIFY ITS MEMBERS OR ANY AFFILIATES OF ITS MEMBERS
AS BEING A DIVISION OR PART OF BORROWER.

 

(VII)        BORROWER SHALL CONTINUE TO BE ADEQUATELY CAPITALIZED IN LIGHT OF
THE NATURE OF ITS BUSINESS.

 

(VIII)       BORROWER SHALL NOT ASSUME OR GUARANTEE THE LIABILITIES OF ITS
MEMBERS, ANY AFFILIATES OF ITS MEMBERS OR ANY OTHER PERSONS, EXCEPT FOR
LIABILITIES RELATING TO THE PROPERTY. BORROWER SHALL NOT ACQUIRE OBLIGATIONS OR
SECURITIES OF ITS MEMBERS, OR ANY AFFILIATES OF ITS MEMBERS OR ANY OTHER
PERSONS. EXCEPT FOR THE LIENS GRANTED PURSUANT TO THE LOAN DOCUMENTS, BORROWER
SHALL NOT PLEDGE ITS ASSETS FOR THE BENEFIT OF ANY OTHER PERSON (OTHER THAN THE
AGENT) OR MAKE LOANS OR ADVANCES TO ITS MEMBERS (OR ANY PREDECESSOR
CORPORATION), OR ANY AFFILIATES OF ITS MEMBERS OR ANY OTHER PERSONS.

 

(IX)          BORROWER SHALL NOT ENTER INTO OR BE A PARTY TO ANY TRANSACTION
WITH ITS MEMBERS OR ANY AFFILIATES OF ITS MEMBERS, EXCEPT FOR IN THE ORDINARY
COURSE OF BUSINESS ON TERMS WHICH ARE NO LESS FAVORABLE TO BORROWER THAN WOULD
BE OBTAINED IN A COMPARABLE ARM’S LENGTH TRANSACTION WITH AN UNRELATED THIRD
PARTY (OTHER THAN IN CONNECTION WITH THE EXECUTION BY BORROWER AND THE MANAGER
OF THE MANAGEMENT AGREEMENT).

 

(U)           ERISA.  BORROWER SHALL DELIVER TO AGENT AS SOON AS POSSIBLE, AND
IN ANY EVENT WITHIN TEN DAYS AFTER BORROWER KNOWS OR HAS REASON TO BELIEVE THAT
ANY OF THE EVENTS OR CONDITIONS SPECIFIED BELOW WITH RESPECT TO ANY PLAN OR
MULTIEMPLOYER PLAN HAS OCCURRED OR EXISTS, AN OFFICER’S CERTIFICATE SETTING
FORTH DETAILS RESPECTING SUCH EVENT OR CONDITION AND THE ACTION, IF ANY, THAT
BORROWER OR ITS ERISA AFFILIATE PROPOSES TO TAKE WITH RESPECT THERETO (AND A

 

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COPY OF ANY REPORT OR NOTICE REQUIRED TO BE FILED WITH OR GIVEN TO PBGC BY
BORROWER OR AN ERISA AFFILIATE WITH RESPECT TO SUCH EVENT OR CONDITION):

 

(I)            ANY REPORTABLE EVENT, AS DEFINED IN SECTION 4043(B) OF ERISA AND
THE REGULATIONS ISSUED THEREUNDER, WITH RESPECT TO A PLAN, AS TO WHICH PBGC HAS
NOT BY REGULATION WAIVED THE REQUIREMENT OF SECTION 4043(A) OF ERISA THAT IT BE
NOTIFIED WITHIN THIRTY (30) DAYS OF THE OCCURRENCE OF SUCH EVENT (PROVIDED THAT
A FAILURE TO MEET THE MINIMUM FUNDING STANDARD OF SECTION 412 OF THE CODE OR
SECTION 302 OF ERISA, INCLUDING, WITHOUT LIMITATION, THE FAILURE TO MAKE ON OR
BEFORE ITS DUE DATE A REQUIRED INSTALLMENT UNDER SECTION 412(M) OF THE CODE OR
SECTION 302(E) OF ERISA, SHALL BE A REPORTABLE EVENT REGARDLESS OF THE ISSUANCE
OF ANY WAIVERS IN ACCORDANCE WITH SECTION 412(D) OF THE CODE); AND ANY REQUEST
FOR A WAIVER UNDER SECTION 412(D) OF THE CODE FOR ANY PLAN;

 

(II)           THE DISTRIBUTION UNDER SECTION 4041(C) OF ERISA OF A NOTICE OF
INTENT TO TERMINATE ANY PLAN OR ANY ACTION TAKEN BY BORROWER OR AN ERISA
AFFILIATE TO TERMINATE ANY PLAN;

 

(III)          THE INSTITUTION BY PBGC OF PROCEEDINGS UNDER SECTION 4042 OF
ERISA FOR THE TERMINATION OF, OR THE APPOINTMENT OF A TRUSTEE TO ADMINISTER, ANY
PLAN, OR THE RECEIPT BY BORROWER OR ANY ERISA AFFILIATE OF BORROWER OF A NOTICE
FROM A MULTIEMPLOYER PLAN THAT SUCH ACTION HAS BEEN TAKEN BY PBGC WITH RESPECT
TO SUCH MULTIEMPLOYER PLAN;

 

(IV)         THE COMPLETE OR PARTIAL WITHDRAWAL FROM A MULTIEMPLOYER PLAN BY
BORROWER OR ANY ERISA AFFILIATE OF BORROWER THAT RESULTS IN MATERIAL LIABILITY
UNDER SECTION 4201 OR 4204 OF ERISA (INCLUDING THE OBLIGATION TO SATISFY
SECONDARY LIABILITY AS A RESULT OF A PURCHASER DEFAULT) OR THE RECEIPT BY
BORROWER OR ANY ERISA AFFILIATE OF BORROWER OF NOTICE FROM A MULTIEMPLOYER PLAN
THAT IT IS IN REORGANIZATION OR INSOLVENCY PURSUANT TO SECTION 4241 OR 4245 OF
ERISA OR THAT IT INTENDS TO TERMINATE OR HAS TERMINATED UNDER SECTION 4041A OF
ERISA;

 

(V)          THE INSTITUTION OF A PROCEEDING BY A FIDUCIARY OF ANY MULTIEMPLOYER
PLAN AGAINST BORROWER OR ANY ERISA AFFILIATE OF BORROWER TO ENFORCE SECTION 515
OF ERISA, WHICH PROCEEDING IS NOT DISMISSED WITHIN THIRTY (30) DAYS;

 

(VI)         THE ADOPTION OF AN AMENDMENT TO ANY PLAN THAT, PURSUANT TO
SECTION 401(A)(29) OF THE CODE OR SECTION 307 OF ERISA, WOULD RESULT IN THE LOSS
OF TAX-EXEMPT STATUS OF THE TRUST OF WHICH SUCH PLAN IS A PART IF BORROWER OR AN
ERISA AFFILIATE OF BORROWER FAILS TO TIMELY PROVIDE SECURITY TO THE PLAN IN
ACCORDANCE WITH THE PROVISIONS OF SAID SECTIONS; AND

 

(VII)        THE IMPOSITION OF A LIEN OR A SECURITY INTEREST IN CONNECTION WITH
A PLAN.

 

(V)           RESERVED.

 

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(W)          RESERVED.

 

(x)            Insurance.

 

(I)           BORROWER, AT ITS SOLE COST AND EXPENSE, SHALL KEEP THE
IMPROVEMENTS AND EQUIPMENT INSURED (INCLUDING, BUT NOT LIMITED TO, ANY PERIOD OF
RENOVATION, ALTERATION AND/OR CONSTRUCTION) DURING THE TERM OF THE LOAN WITH THE
COVERAGE AND IN THE AMOUNTS REQUIRED UNDER THIS AGREEMENT (AND WITH DEDUCTIBLES
ACCEPTABLE TO AGENT) FOR THE MUTUAL BENEFIT OF BORROWER AND AGENT AGAINST LOSS
OR DAMAGE BY FIRE, LIGHTNING, WIND AND SUCH OTHER PERILS AS ARE CUSTOMARILY
INCLUDED IN A STANDARD “ALL-RISK” OR “SPECIAL CAUSE OF LOSS” FORM AND AGAINST
LOSS OR DAMAGE BY OTHER RISKS AND HAZARDS COVERED BY A STANDARD EXTENDED
COVERAGE INSURANCE POLICY (INCLUDING, WITHOUT LIMITATION, RIOT AND CIVIL
COMMOTION, VANDALISM, MALICIOUS MISCHIEF, BURGLARY, COLLAPSE, THEFT AND SUCH
OTHER COVERAGES AS MAY BE REASONABLY REQUIRED BY AGENT ON THE SPECIAL FORM
(FORMERLY KNOWN AS AN ALL-RISK FORM)). SUCH INSURANCE SHALL BE IN AN AMOUNT
(I) EQUAL TO AT LEAST THE FULL REPLACEMENT COST OF THE IMPROVEMENTS AND
EQUIPMENT (EXCLUSIVE OF THE COST OF FOUNDATIONS AND FOOTINGS), WITHOUT DEDUCTION
FOR PHYSICAL DEPRECIATION, (II) SUCH THAT THE INSURER WOULD NOT DEEM BORROWER A
CO-INSURER UNDER SAID POLICIES AND (III) WITH RESPECT TO LOSS OR DAMAGE BY WIND,
SHALL BE SUBJECT TO A DEDUCTIBLE NO GREATER THAN 5% OF TOTAL INSURED VALUE. THE
POLICIES OF INSURANCE CARRIED IN ACCORDANCE WITH THIS SECTION 5.1(X) SHALL BE
PAID NOT LESS THAN TEN (10) DAYS IN ADVANCE OF THE DUE DATE THEREOF AND SHALL
CONTAIN THE “REPLACEMENT COST ENDORSEMENT” WITH A WAIVER OF DEPRECIATION. IF
TERRORISM COVERAGE IS EXCLUDED ON AN “ALL-RISK” BASIS, THEN THE BORROWER SHALL
OBTAIN COVERAGE FOR TERRORISM AND SIMILAR ACTS IN THE STANDALONE TERRORISM
MARKET. NOTWITHSTANDING THE FOREGOING, AGENT SHALL NOT UNREASONABLY WITHHOLD ITS
CONSENT TO REDUCTIONS IN THE STATED AMOUNTS AND TYPES OF COVERAGE REQUIRED TO BE
MAINTAINED BY BORROWER HEREUNDER IF SUCH LEVELS OF COVERAGE OR TYPES OF
INSURANCE, AS DETERMINED BY AGENT IN ITS SOLE REASONABLE DISCRETION, (A) ARE NOT
AVAILABLE AT COMMERCIALLY REASONABLE RATES, (B) ARE NOT AT THE TIME COMMONLY
MAINTAINED FOR PROPERTIES SIMILAR TO THE PROPERTY AND LOCATED IN OR AROUND THE
REGION IN WHICH THE PROPERTY IS LOCATED AND (C) BORROWER SHALL NOT BE REQUIRED
TO SPEND IN EXCESS OF $150,000 FOR TERRORISM COVERAGE.

 

(II)          BORROWER, AT ITS SOLE COST AND EXPENSE, FOR THE MUTUAL BENEFIT OF
BORROWER AND AGENT, SHALL ALSO (OR SHALL CAUSE THE TENANT UNDER THE TERMS OF AN
APPLICABLE LEASE TO) OBTAIN AND MAINTAIN OR CAUSE TO BE OBTAINED AND MAINTAINED
DURING THE ENTIRE TERM OF THE LOAN THE FOLLOWING POLICIES OF INSURANCE:

 

(A)         FLOOD INSURANCE, IF ANY PART OF THE PROPERTY IS LOCATED IN AN AREA
IDENTIFIED BY THE FEDERAL EMERGENCY MANAGEMENT AGENCY AS AN AREA HAVING SPECIAL
FLOOD HAZARDS AND IN WHICH FLOOD INSURANCE HAS BEEN MADE AVAILABLE UNDER THE
NATIONAL FLOOD INSURANCE ACT OF 1968, THE FLOOD DISASTER PROTECTION ACT OF 1973
OR THE NATIONAL FLOOD INSURANCE REFORM ACT OF 1994 (AND ANY AMENDMENT OR
SUCCESSOR ACT THERETO) IN AN AMOUNT AT LEAST EQUAL TO THE MAXIMUM LIMIT OF
COVERAGE AVAILABLE WITH RESPECT TO THE IMPROVEMENTS AND EQUIPMENT UNDER SAID ACT
AND WITH DEDUCTIBLES NOT TO EXCEED THE MAXIMUM DEDUCTIBLES AVAILABLE UNDER SAID
ACT AND EXCESS FLOOD COVERAGE IN AN AMOUNT OF $5,000,000, INCLUDING

 

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PROPERTY DAMAGE AND BUSINESS INCOME, WHICH EXCESS FLOOD COVERAGE SHALL BE
SUBJECT TO A DEDUCTIBLE IN AN AMOUNT NOT GREATER THAT 5% OF TOTAL INSURED VALUE;

 

(B)          COMMERCIAL GENERAL LIABILITY INSURANCE, INCLUDING COVERAGE FOR
BROAD FORM PROPERTY DAMAGE, CONTRACTUAL DAMAGES, PERSONAL INJURY, BODILY
INJURIES (INCLUDING DEATH RESULTING THEREFROM) AND A LIQUOR LIABILITY
ENDORSEMENT IF LIQUOR IS SOLD ON THE PROPERTY, CONTAINING MINIMUM LIMITS OF
LIABILITY OF $1 MILLION FOR BOTH INJURY TO OR DEATH OF A PERSON AND FOR PROPERTY
DAMAGE PER OCCURRENCE AND $2 MILLION IN THE AGGREGATE FOR THE PROPERTY, AND SUCH
OTHER LIABILITY INSURANCE REASONABLY REQUESTED BY AGENT; IN ADDITION, AT LEAST
$10 MILLION (AND, WITH RESPECT TO THE INDIVIDUAL PROPERTY KNOWN AS WACHOVIA
CENTER TOWER, $50 MILLION) EXCESS AND/OR UMBRELLA LIABILITY INSURANCE SHALL BE
OBTAINED AND MAINTAINED FOR ANY AND ALL CLAIMS, INCLUDING ALL LEGAL LIABILITY
IMPOSED UPON BORROWER AND ALL COURT COSTS AND ATTORNEYS’ FEES INCURRED IN
CONNECTION WITH THE OWNERSHIP, OPERATION AND MAINTENANCE OF THE PROPERTY IN
ACCORDANCE WITH THE STANDARD ISO GENERAL LIABILITY POLICY FORM INCLUSIVE OF
CONTRACTUAL LIABILITY;

 

(C)          BUSINESS INTERRUPTION INSURANCE (INCLUDING RENTAL VALUE) IN AN
ANNUAL AGGREGATE AMOUNT EQUAL TO THE ESTIMATED GROSS REVENUES FROM THE LEASES OF
THE PROPERTY (INCLUDING, WITHOUT LIMITATION, THE LOSS OF ALL RENTS AND
ADDITIONAL RENTS PAYABLE BY ALL OF THE LESSEES UNDER THE LEASES (WHETHER OR NOT
SUCH LEASES ARE TERMINABLE IN THE EVENT OF A FIRE OR CASUALTY)), SUCH INSURANCE
TO COVER LOSSES FOR THE PERIOD FROM THE TIME OF LOSS UNTIL ALL REPAIRS ARE FULLY
COMPLETED WITH REASONABLE DILIGENCE AND DISPATCH, PLUS AN EXTENDED PERIOD OF
INDEMNITY COMMENCING AT THE TIME REPAIRS ARE COMPLETED FOR A PERIOD OF NOT LESS
THAN 90 DAYS AND TO BE INCREASED OR DECREASED, AS REASONABLY REQUIRED BY AGENT;
PROVIDED, HOWEVER, THAT, WITH RESPECT TO THE INDIVIDUAL PROPERTIES COMMONLY KNOW
AS WACHOVIA CENTER TOWER AND WACHOVIA NBOC OP CENTER, SUCH INSURANCE SHALL COVER
LOSSES FOR AT LEAST A PERIOD OF 18 MONTHS AFTER THE DATE OF THE FIRE OR CASUALTY
IN QUESTION, PLUS AN EXTENDED PERIOD OF INDEMNITY COMMENCING AT THE TIME REPAIRS
ARE COMPLETED FOR A PERIOD OF NOT LESS THAN 180 DAYS.  FROM TIME TO TIME DURING
THE TERM OF THE LOAN IF, AND WHEN, THE GROSS REVENUES FROM THE LEASES OF THE
PROPERTY MATERIALLY INCREASE OR DECREASE, UPON ANNUAL RENEWAL OF THE INSURANCE
POLICY (INCLUDING, WITHOUT LIMITATION, INCREASES FROM NEW LEASES AND RENEWAL
LEASES ENTERED INTO IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT), TO REFLECT
ALL INCREASED RENT AND INCREASED ADDITIONAL RENT PAYABLE BY ALL OF THE LESSEES
UNDER SUCH RENEWAL LEASES AND ALL RENT AND ADDITIONAL RENT PAYABLE BY ALL OF THE
LESSEES WIDER SUCH NEW LEASES;

 

(D)          INSURANCE AGAINST LOSS OR DAMAGE FROM EXPLOSION OF STEAM BOILERS,
AIR CONDITIONING EQUIPMENT, HIGH PRESSURE PIPING, MACHINERY AND EQUIPMENT,
PRESSURE VESSELS OR SIMILAR APPARATUS NOW OR HEREAFTER INSTALLED IN THE
IMPROVEMENTS (WITHOUT EXCLUSION FOR EXPLOSIONS), COVERING ALL BOILERS OR OTHER
PRESSURE VESSELS, MACHINERY AND EQUIPMENT LOCATED IN, ON, OR ABOUT THE
IMPROVEMENTS; COVERAGE IS REQUIRED IN SUCH AMOUNT AS IS GENERALLY AVAILABLE AND
COMMONLY MAINTAINED FOR PROPERTIES SIMILAR TO THE PROPERTY AND SHALL EXTEND TO

 

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ELECTRICAL EQUIPMENT, SPRINKLER SYSTEMS, HEATING AND AIR CONDITIONING EQUIPMENT,
REFRIGERATION EQUIPMENT AND PIPING;

 

(E)          WORKER’S COMPENSATION INSURANCE COVERAGE FOR ALL PERSONS EMPLOYED
BY BORROWER OR ITS TENANTS AT THE PROPERTY AND IN COMPLIANCE WITH ALL OTHER
REQUIREMENTS OF APPLICABLE LOCAL, STATE AND FEDERAL LAW AND “EMPLOYERS
LIABILITY” INSURANCE IN AMOUNTS NOT LESS THAN $500,000;

 

(F)          DURING ANY PERIOD OF REPAIR OR RESTORATION, BUILDER’S “ALL-RISK”
INSURANCE OR ITS EQUIVALENT IN AN AMOUNT EQUAL TO NOT LESS THAN THE FULL
INSURABLE VALUE OF THE CONSTRUCTION COSTS AGAINST SUCH RISKS (INCLUDING, WITHOUT
LIMITATION, FIRE AND EXTENDED COVERAGE AND COLLAPSE OF THE IMPROVEMENTS TO
AGREED LIMITS) AS AGENT MAY REQUEST, IN FORM AND SUBSTANCE ACCEPTABLE TO AGENT;

 

(G)         ORDINANCE OR LAW COVERAGE TO COMPENSATE FOR THE COST OF DEMOLITION,
INCREASED COST OF CONSTRUCTION (IN AMOUNTS ACCEPTABLE TO AGENT), AND LOSS TO ANY
UNDAMAGED PORTIONS OF THE IMPROVEMENTS, IF THE CURRENT USE OF THE PROPERTY OR
THE IMPROVEMENTS THEMSELVES ARE OR BECOME “NONCONFORMING” PURSUANT TO THE
APPLICABLE ZONING REGULATIONS, OR FULL REBUILDABILITY FOLLOWING CASUALTY IS
OTHERWISE NOT PERMITTED UNDER SUCH ZONING REGULATIONS;

 

(H)         IF REQUIRED BY AGENT AS A RESULT OF THE PROPERTY BEING LOCATED IN AN
AREA WITH A HIGH DEGREE OF SEISMIC ACTIVITY, EARTHQUAKE DAMAGE INSURANCE IN A
REASONABLE AMOUNT AND FORM ACCEPTABLE TO AGENT AND COMMERCIALLY AVAILABLE; AND

 

(I)           SUCH OTHER INSURANCE AS MAY FROM TIME TO TIME BE REASONABLY
REQUIRED BY AGENT IN ORDER TO PROTECT ITS INTERESTS WITH RESPECT TO THE LOAN AND
THE PROPERTY. AND IS COMMONLY MAINTAINED FOR PROPERTIES SIMILAR TO THE PROPERTY.

 

(III)          ALL POLICIES OF INSURANCE (THE “POLICIES”) REQUIRED PURSUANT TO
THIS SECTION 5.1(X):

 

(A)         SHALL BE ISSUED BY AN INSURER APPROVED BY AGENT WHICH HAS A CLAIMS
PAYING ABILITY RATING OF NOT LESS THAN “A-” (OR THE EQUIVALENT) BY RATING
AGENCIES SATISFACTORY TO AGENT (ONE OF WHICH SHALL BE STANDARD & POOR’S RATINGS
GROUP) OR A:X OR BETTER AS TO CLAIMS PAYING ABILITY BY AM BEST; PROVIDED, THAT,
NOTWITHSTANDING THE FOREGOING, NO MORE THAN 25% OF THE AMOUNTS OF INSURANCE MAY
BE PROVIDED BY CARRIERS WITH AN AM BEST RATING OF NOT LESS THAN A-/VIII);
PROVIDED, HOWEVER, IF THE INSURANCE PROVIDED HEREUNDER IS PROCURED BY A
SYNDICATION OF MORE THAN FIVE INSURERS THEN THE FOREGOING REQUIREMENTS SHALL NOT
BE VIOLATED IF AT LEAST SIXTY PERCENT OF THE COVERAGE IS WITH CARRIERS HAVING A
CLAIMS PAYING ABILITY RATING OF “A-” OR BETTER BY STANDARD & POOR’S,

 

(B)         SHALL NAME AGENT AS AN ADDITIONAL INSURED AND CONTAIN A STANDARD
NONCONTRIBUTORY MORTGAGEE CLAUSE AND AN AGENT’S LOSS PAYABLE

 

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ENDORSEMENT, OR THEIR EQUIVALENTS, NAMING AGENT (AND/OR SUCH OTHER PARTY AS MAY
BE DESIGNATED BY AGENT) AS THE PARTY TO WHICH ALL PAYMENTS MADE BY SUCH
INSURANCE COMPANY SHALL BE PAID; PROVIDED, WITH RESPECT TO CTL PROPERTIES ONLY,
BORROWER SHALL ENDEAVOR TO COMPLY WITH THIS PARAGRAPH IF THE INSURANCE OBTAINED
BY THE TENANT (AND NOT THE BORROWER) SATISFIES THE REQUIREMENT,

 

(C)           SHALL BE MAINTAINED THROUGHOUT THE TERM OF THE LOAN WITHOUT COST
TO AGENT,

 

(D)          SHALL CONTAIN SUCH PROVISIONS AS AGENT DEEMS REASONABLY NECESSARY
OR DESIRABLE TO PROTECT ITS INTEREST AND IS COMMONLY MAINTAINED FOR PROPERTIES
SIMILAR TO THE PROPERTY (INCLUDING, WITHOUT LIMITATION, ENDORSEMENTS PROVIDING
THAT NEITHER BORROWER, AGENT NOR ANY OTHER PARTY SHALL BE A CO-INSURER UNDER
SAID POLICIES AND THAT AGENT SHALL RECEIVE AT LEAST THIRTY (30) DAYS PRIOR
WRITTEN NOTICE OF ANY MODIFICATION, NON-RENEWAL OR CANCELLATION),

 

(E)           SHALL CONTAIN A WAIVER OF SUBROGATION AGAINST AGENT,

 

(F)           SHALL BE FOR A TERM OF NOT LESS THAN ONE YEAR,

 

(G)           SHALL BE ISSUED BY AN INSURER LICENSED IN THE STATE IN WHICH THE
PROPERTY IS LOCATED,

 

(H)          SHALL PROVIDE THAT AGENT MAY, BUT SHALL NOT BE OBLIGATED TO, MAKE
PREMIUM PAYMENTS TO PREVENT ANY CANCELLATION, ENDORSEMENT, ALTERATION OR
REISSUANCE, AND SUCH PAYMENTS SHALL BE ACCEPTED BY THE INSURER TO PREVENT SAME;
PROVIDED, WITH RESPECT TO CTL PROPERTIES ONLY, BORROWER SHALL ENDEAVOR TO COMPLY
WITH THIS PARAGRAPH IF THE INSURANCE OBTAINED BY THE TENANT (AND NOT THE
BORROWER) SATISFIES THE REQUIREMENT, AND

 

(I)            SHALL BE REASONABLY SATISFACTORY IN FORM AND SUBSTANCE TO AGENT
AND REASONABLY APPROVED BY AGENT AS TO AMOUNTS, FORM, RISK COVERAGE,
DEDUCTIBLES, LOSS PAYEES AND INSUREDS TO THE EXTENT NOT OTHERWISE SPECIFIED IN
THIS SECTION 5.1(X) AND IS COMMONLY MAINTAINED BY PROPERTIES SIMILAR TO THE
PROPERTY.

 

Insurance certificates evidencing such coverages shall be delivered to Agent;
provided, however, upon demand by a Rating Agency, copies of said Policies,
shall be delivered to Agent. Prior to the expiration date of each of the
Policies, Borrower shall deliver to Agent satisfactory evidence of the renewal
of each Policy. The insurance coverage required under this Section 5.1(x) may be
effected under a blanket policy or policies covering the Property and other
property and assets not constituting a part of the Collateral; provided that any
such blanket policy shall provide at least the same amount and form of
protection as would a separate policy insuring the Property individually, which
amount shall not be less than the amount required pursuant to this
Section 5.1(x) and which shall in any case comply in all other respects with the
requirements of this Section 5.1(x). Upon demand therefor and after fifteen days
notice of default, Borrower shall reimburse Agent for all of Agent’s or its
designee’s reasonable costs and expenses

 

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incurred in obtaining any or all of the Policies or otherwise causing the
compliance with the terms and provisions of this Section 5.1(x), including
(without limitation) obtaining updated flood hazard certificates and replacement
of any so-called “forced placed” insurance coverages to the extent Borrower was
required to obtain and maintain any such Policy or Policies hereunder and failed
to do so. Borrower shall pay the premiums for such Policies (the “Insurance
Premiums”) as the same become due and payable and shall furnish to Agent
evidence of the renewal of each of the Policies with receipts for the payment of
the Insurance Premiums or other evidence of such payment reasonably satisfactory
to Agent (provided, however, that Borrower is not required to furnish such
evidence of payment to Agent in the event that such Insurance Premiums have been
paid by Agent or the Collateral Agent). If Borrower does not furnish such
evidence and receipts prior to the expiration of any expiring Policy, then Agent
may procure, but shall not be obligated to procure, such insurance and pay the
Insurance Premiums therefor, and Borrower agrees to reimburse Agent for the cost
of such Insurance Premiums promptly on demand. Within thirty (30) days after
request by Agent, Borrower shall obtain such increases in the amounts of
coverage required hereunder as may be reasonably requested by Agent, based on
then industry-standard amounts of coverage then being obtained by prudent owners
of properties similar to the Property in the same applicable market region as
the Property. Borrower shall give Agent prompt written notice if Borrower
receives from any insurer any written notification or threat of any actions or
proceedings regarding the non-compliance or non-conformity of the Property with
any insurance requirements.

 

(IV)          IF THE PROPERTY SHALL BE DAMAGED OR DESTROYED, IN WHOLE OR IN
PART, BY FIRE OR OTHER CASUALTY, BORROWER SHALL GIVE PROMPT NOTICE THEREOF TO
AGENT.

 

(A)         IN CASE OF LOSS COVERED BY POLICIES, AGENT MAY EITHER (A) JOINTLY
WITH A BORROWER SETTLE AND ADJUST ANY CLAIM AND AGREE WITH THE INSURANCE COMPANY
OR COMPANIES ON THE AMOUNT TO BE PAID ON THE LOSS OR (B) ALLOW BORROWER TO AGREE
WITH THE INSURANCE COMPANY OR COMPANIES ON THE AMOUNT TO BE PAID UPON THE LOSS;
PROVIDED, THAT BORROWER MAY SETTLE AND ADJUST LOSSES PER OCCURRENCE LEVEL NOT IN
EXCESS OF $100,000, AGREE WITH THE INSURANCE COMPANY OR COMPANIES ON THE AMOUNT
TO BE PAID UPON THE LOSS AND COLLECT AND RECEIPT FOR ANY SUCH INSURANCE
PROCEEDS; PROVIDED, FURTHER, THAT IF (X) AT THE TIME OF THE SETTLEMENT OF SUCH
CLAIM AN EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING OR (Y) THE AGENT AND
THE BORROWER ARE UNABLE TO AGREE UPON A JOINT SETTLEMENT OR (Z) THE AGENT
DISAPPROVES OF THE BORROWER’S PROPOSED SETTLEMENT WITH THE INSURANCE COMPANY,
THEN AGENT SHALL SETTLE AND ADJUST SUCH CLAIM WITHOUT THE CONSENT OF BORROWER.
IN ANY SUCH CASE AGENT SHALL AND IS HEREBY AUTHORIZED TO COLLECT AND RECEIPT FOR
ANY SUCH INSURANCE PROCEEDS SUBJECT TO AND TO THE EXTENT PROVIDED FOR IN THIS
AGREEMENT. THE REASONABLE OUT-OF-POCKET EXPENSES INCURRED BY AGENT IN THE
ADJUSTMENT AND COLLECTION OF INSURANCE PROCEEDS SHALL BECOME PART OF THE
INDEBTEDNESS AND BE SECURED BY THE MORTGAGE AND SHALL BE REIMBURSED BY BORROWER
TO AGENT UPON DEMAND THEREFOR.

 

(B)         IN THE EVENT OF ANY INSURED DAMAGE TO OR DESTRUCTION OF THE PROPERTY
OR ANY PART THEREOF (HEREIN CALLED AN “INSURED CASUALTY”) WHERE THE

 

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AGGREGATE AMOUNT OF THE LOSS, AS REASONABLY DETERMINED BY AN INDEPENDENT
INSURANCE ADJUSTER, IS LESS THAN TEN PERCENT (10%) OF THE RELATED ADVANCE, AND
IF, IN THE REASONABLE JUDGMENT OF AGENT, THE PROPERTY CAN BE RESTORED BY NOT
LATER THAN THE FIRST TO OCCUR OF (A) TWELVE (12) MONTHS OF SETTLEMENT OF THE
CLAIM AND (B) THE EXPIRATION OF THE BUSINESS INTERRUPTION INSURANCE AND, IN ANY
CASE, NOT LATER THAN SIX (6) MONTHS PRIOR TO THE MATURITY DATE TO AN ECONOMIC
UNIT NOT LESS MATERIALLY VALUABLE (INCLUDING AN ASSESSMENT OF THE IMPACT OF THE
TERMINATION OF ANY LEASES DUE TO SUCH INSURED CASUALTY) AND NOT LESS USEFUL THAN
THE SAME WAS PRIOR TO THE INSURED CASUALTY, OR IF AGENT OTHERWISE ELECTS TO
ALLOW A BORROWER TO RESTORE THE PROPERTY, THEN, IF NO EVENT OF DEFAULT SHALL
HAVE OCCURRED AND BE CONTINUING, THE INSURANCE PROCEEDS (AFTER REIMBURSEMENT OF
ANY REASONABLE OUT-OF-POCKET EXPENSES INCURRED BY AGENT IN CONNECTION WITH THE
COLLECTION OF ANY APPLICABLE INSURANCE PROCEEDS) SHALL BE MADE AVAILABLE TO
REIMBURSE BORROWER FOR THE COST OF RESTORING, REPAIRING, REPLACING OR REBUILDING
THE PROPERTY OR PART THEREOF SUBJECT TO THE INSURED CASUALTY, AS PROVIDED FOR
BELOW. BORROWER HEREBY COVENANTS AND AGREES TO COMMENCE AND DILIGENTLY TO
PROSECUTE SUCH RESTORING, REPAIRING, REPLACING OR REBUILDING. BORROWER SHALL PAY
ALL OUT-OF-POCKET COSTS (AND IF REQUIRED BY AGENT, BORROWER SHALL DEPOSIT THE
TOTAL THEREOF WITH AGENT IN ADVANCE) OF SUCH RESTORING, REPAIRING, REPLACING OR
REBUILDING IN EXCESS OF THE INSURANCE PROCEEDS MADE AVAILABLE PURSUANT TO THE
TERMS HEREOF (THE “DEFICIENT AMOUNT”).

 

(C)           EXCEPT AS PROVIDED ABOVE, THE INSURANCE PROCEEDS COLLECTED UPON
ANY INSURED CASUALTY SHALL, AT THE OPTION OF AGENT IN ITS SOLE DISCRETION, BE
APPLIED TO THE PAYMENT OF THE INDEBTEDNESS AS PROVIDED IN SECTION 2.7(B) OF THIS
AGREEMENT OR APPLIED TO THE COST OF RESTORING, REPAIRING, REPLACING OR
REBUILDING THE AFFECTED PROPERTY OR PART THEREOF SUBJECT TO THE INSURED
CASUALTY, IN THE MANNER SET FORTH BELOW.

 

(D)          IN THE EVENT THAT INSURANCE PROCEEDS (AFTER REIMBURSEMENT OF ANY
REASONABLE EXPENSES INCURRED BY AGENT IN CONNECTION WITH THE COLLECTION OF ANY
APPLICABLE INSURANCE PROCEEDS), IF ANY, SHALL BE MADE AVAILABLE TO BORROWER FOR
THE RESTORING, REPAIRING, REPLACING OR REBUILDING OF ANY PORTION OF THE AFFECTED
PROPERTY, BORROWER COVENANTS TO RESTORE, REPAIR, REPLACE OR REBUILD THE SAME TO
BE OF AT LEAST COMPARABLE VALUE AS PRIOR TO SUCH DAMAGE OR DESTRUCTION, ALL TO
BE EFFECTED IN ACCORDANCE WITH LEGAL REQUIREMENTS AND PLANS AND SPECIFICATIONS
APPROVED IN ADVANCE BY AGENT, SUCH APPROVAL NOT TO BE UNREASONABLY WITHHELD OR
DELAYED.

 

(E)           IN THE EVENT BORROWER IS ENTITLED TO REIMBURSEMENT OUT OF
INSURANCE PROCEEDS, SUCH PROCEEDS SHALL BE HELD IN AN ELIGIBLE ACCOUNT AS
PROVIDED IN SECTION 2.12(F) AND DISBURSED FROM TIME TO TIME AS THE RESTORATION
PROGRESSES UPON AGENT BEING FURNISHED WITH (1) EVIDENCE REASONABLY SATISFACTORY
TO IT (WHICH EVIDENCE MAY INCLUDE INSPECTION(S) OF THE WORK PERFORMED) THAT THE
RESTORATION, REPAIR, REPLACEMENT AND REBUILDING COVERED BY THE DISBURSEMENT HAS
BEEN COMPLETED IN ACCORDANCE WITH PLANS AND SPECIFICATIONS APPROVED BY AGENT,
(2) EVIDENCE REASONABLY SATISFACTORY TO IT OF THE ESTIMATED COST OF COMPLETION
OF THE RESTORATION, REPAIR, REPLACEMENT AND REBUILDING, (3) FUNDS, OR, AT
AGENT’S

 

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OPTION, ASSURANCES REASONABLY SATISFACTORY TO AGENT THAT SUCH FUNDS ARE
AVAILABLE AND SUFFICIENT IN ADDITION TO THE INSURANCE PROCEEDS TO COMPLETE THE
PROPOSED RESTORATION, REPAIR, REPLACEMENT AND REBUILDING, AND (4) SUCH
ARCHITECT’S CERTIFICATES, WAIVERS OF LIEN, CONTRACTOR’S SWORN STATEMENTS, TITLE
INSURANCE ENDORSEMENTS, BONDS AND OTHER EVIDENCES OF COST, PAYMENT AND
PERFORMANCE OF THE FOREGOING REPAIR, RESTORATION, REPLACEMENT OR REBUILDING AS
AGENT MAY REASONABLY REQUIRE AND APPROVE. AGENT MAY, IN ANY EVENT, REQUIRE THAT
ALL PLANS AND SPECIFICATIONS FOR SUCH RESTORATION, REPAIR, REPLACEMENT AND
REBUILDING BE SUBMITTED TO AND REASONABLY APPROVED BY AGENT PRIOR TO
COMMENCEMENT OF WORK. AGENT MAY RETAIN A CONSTRUCTION CONSULTANT TO INSPECT SUCH
WORK AND REVIEW BORROWER’S REQUEST FOR PAYMENTS AND BORROWER SHALL, ON DEMAND BY
AGENT, REIMBURSE AGENT FOR THE REASONABLE FEES AND DISBURSEMENTS OF SUCH
CONSULTANT. NO PAYMENT MADE PRIOR TO THE FINAL COMPLETION OF THE RESTORATION,
REPAIR, REPLACEMENT AND REBUILDING SHALL EXCEED NINETY PERCENT (90%) OF THE HARD
CONSTRUCTION COSTS VALUE OF THE WORK PERFORMED FROM TIME TO TIME (EXCEPT FOR
RESTORATION WORK ON A TRADE BY TRADE BASIS OR ON AN HOURLY BASIS FOR
PROFESSIONAL SERVICES IN WHICH EVENT, PAYMENT MAY BE MADE IN FULL UPON THE
COMPLETION OF SUCH WORK); FUNDS OTHER THAN INSURANCE PROCEEDS SHALL BE DISBURSED
PRIOR TO DISBURSEMENT OF SUCH PROCEEDS; AND, AT ALL TIMES, THE UNDISBURSED
BALANCE OF SUCH PROCEEDS REMAINING IN THE ACCOUNTS OF AGENT, TOGETHER WITH FUNDS
DEPOSITED FOR THAT PURPOSE OR IRREVOCABLY COMMITTED TO THE REPAYMENT OF AGENT BY
OR ON BEHALF OF BORROWER FOR THAT PURPOSE, SHALL BE AT LEAST SUFFICIENT IN THE
REASONABLE JUDGMENT OF AGENT TO PAY FOR THE COST OF COMPLETION OF THE
RESTORATION, REPAIR, REPLACEMENT OR REBUILDING, FREE AND CLEAR OF ALL LIENS OR
CLAIMS FOR LIEN, EXCEPT FOR PERMITTED ENCUMBRANCES. ANY SURPLUS WHICH MAY REMAIN
OUT OF INSURANCE PROCEEDS HELD BY AGENT AFTER PAYMENT OF SUCH COSTS OF
RESTORATION, REPAIR, REPLACEMENT OR REBUILDING SHALL BE PAID TO BORROWER SO LONG
AS NO EVENT OF DEFAULT HAS OCCURRED AND IS CONTINUING.

 

(V)          BORROWER SHALL NOT CARRY SEPARATE INSURANCE, CONCURRENT IN KIND OR
FORM OR CONTRIBUTING IN THE EVENT OF LOSS, WITH ANY INSURANCE REQUIRED UNDER
THIS AGREEMENT THAT WOULD BE CONSIDERED “CO-INSURANCE” OR ADVERSELY AFFECT THE
ABILITY TO COLLECT UNDER A POLICY OF INSURANCE REQUIRED HEREUNDER.

 

(Y)           CONDEMNATION.

 

(I)           BORROWER SHALL PROMPTLY GIVE AGENT WRITTEN NOTICE OF THE ACTUAL OR
THREATENED COMMENCEMENT OF ANY PROCEEDING FOR A TAKING AND SHALL DELIVER TO
AGENT COPIES OF ANY AND ALL PAPERS SERVED IN CONNECTION WITH SUCH PROCEEDINGS.
AGENT IS HEREBY IRREVOCABLY APPOINTED AS BORROWER’S ATTORNEY-IN-FACT, COUPLED
WITH AN INTEREST, WITH EXCLUSIVE POWER TO COLLECT, RECEIVE AND RETAIN ANY
CONDEMNATION PROCEEDS FOR SAID TAKING. WITH RESPECT TO ANY COMPROMISE OR
SETTLEMENT IN CONNECTION WITH SUCH PROCEEDING, AGENT SHALL JOINTLY WITH BORROWER
COMPROMISE AND REACH SETTLEMENT UNLESS AT THE TIME OF SUCH TAKING AN EVENT OF
DEFAULT HAS OCCURRED AND IS CONTINUING AND THE INDEBTEDNESS HAS BEEN
ACCELERATED, IN WHICH EVENT AGENT SHALL COMPROMISE AND REACH SETTLEMENT WITHOUT
THE CONSENT OF BORROWER. NOTWITHSTANDING THE FOREGOING PROVISIONS OF THIS
SECTION 5.1(Y), BORROWER IS AUTHORIZED TO NEGOTIATE, COMPROMISE AND SETTLE,
WITHOUT PARTICIPATION BY AGENT, CONDEMNATION PROCEEDS OF UP TO $50,000 IN
CONNECTION WITH ANY

 

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TAKING. NOTWITHSTANDING ANY TAKING, BORROWER SHALL CONTINUE TO PAY THE
INDEBTEDNESS AT THE TIME AND IN THE MANNER PROVIDED FOR IN THIS AGREEMENT AND
THE OTHER LOAN DOCUMENTS AND THE INDEBTEDNESS SHALL NOT BE REDUCED EXCEPT IN
ACCORDANCE THEREWITH.

 

(II)           BORROWER SHALL CAUSE THE CONDEMNATION PROCEEDS TO BE PAID
DIRECTLY TO THE COLLECTION ACCOUNT AS PROVIDED IN SECTION 3.7(B) OF THIS
AGREEMENT. AGENT MAY, IN ITS SOLE DISCRETION, APPLY ANY SUCH CONDEMNATION
PROCEEDS TO THE REDUCTION OR DISCHARGE OF THE INDEBTEDNESS (WHETHER OR NOT THEN
DUE AND PAYABLE).

 

(III)          WITH RESPECT TO A TAKING IN PART, WHICH SHALL MEAN ANY TAKING
WHICH DOES NOT RENDER THE AFFECTED PROPERTY PHYSICALLY OR ECONOMICALLY
UNSUITABLE IN THE REASONABLE JUDGMENT OF AGENT FOR THE USE TO WHICH IT WAS
DEVOTED PRIOR TO THE TAKING, BORROWER SHALL CAUSE THE CONDEMNATION PROCEEDS TO
BE PAID TO AGENT AS DESCRIBED ABOVE OR DEPOSITED INTO THE APPLICABLE ACCOUNT
PURSUANT TO THE PROVISIONS OF THIS AGREEMENT, TO BE APPLIED TO THE COST OF
REPAIRING, REPLACING, RESTORING OR REBUILDING THE AFFECTED PROPERTY AS FOLLOWS:

 

(A)         PROVIDED THAT CONDEMNATION PROCEEDS SHALL BE MADE AVAILABLE TO
BORROWER FOR THE RESTORING, REPAIRING, REPLACING OR REBUILDING OF THE AFFECTED
PROPERTY, BORROWER HEREBY COVENANTS TO RESTORE, REPAIR, REPLACE OR REBUILD THE
SAME TO BE OF AT LEAST COMPARABLE VALUE AND, TO THE EXTENT COMMERCIALLY
PRACTICABLE, OF SUBSTANTIALLY THE SAME CHARACTER AS PRIOR TO THE TAKING, ALL TO
BE EFFECTED IN ACCORDANCE WITH APPLICABLE LAW AND PLANS AND SPECIFICATIONS
REASONABLY APPROVED IN ADVANCE BY AGENT. BORROWER SHALL PAY ALL COSTS (AND IF
REQUIRED BY AGENT, BORROWER SHALL DEPOSIT THE TOTAL THEREOF WITH AGENT IN
ADVANCE) OF SUCH RESTORING, REPAIRING, REPLACING OR REBUILDING IN EXCESS OF THE
CONDEMNATION PROCEEDS MADE AVAILABLE PURSUANT TO THE TERMS HEREOF.

 

(B)         THE CONDEMNATION PROCEEDS HELD BY AGENT SHALL BE HELD IN AN ELIGIBLE
ACCOUNT AS PROVIDED IN SECTION 3.12(F) AND DISBURSED FROM TIME TO TIME AS THE
RESTORATION PROGRESSES UPON AGENT BEING FURNISHED WITH (1) EVIDENCE REASONABLY
SATISFACTORY TO IT (WHICH EVIDENCE MAY INCLUDE INSPECTION(S) OF THE WORK
PERFORMED) THAT THE RESTORATION, REPAIR, REPLACEMENT AND REBUILDING COVERED BY
THE DISBURSEMENT HAS BEEN COMPLETED IN ACCORDANCE WITH PLANS AND SPECIFICATIONS
APPROVED BY AGENT, (2) EVIDENCE REASONABLY SATISFACTORY TO IT OF THE ESTIMATED
COST OF COMPLETION OF THE RESTORATION, REPAIR, REPLACEMENT AND REBUILDING,
(3) FUNDS, OR, AT AGENT’S OPTION, ASSURANCES SATISFACTORY TO AGENT THAT SUCH
FUNDS ARE AVAILABLE AND SUFFICIENT IN ADDITION TO THE CONDEMNATION PROCEEDS TO
COMPLETE THE PROPOSED RESTORATION, REPAIR, REPLACEMENT AND REBUILDING, AND
(4) SUCH ARCHITECT’S CERTIFICATES, WAIVERS OF LIEN, CONTRACTOR’S SWORN
STATEMENTS, TITLE INSURANCE ENDORSEMENTS, BONDS AND OTHER EVIDENCES OF COST,
PAYMENT AND PERFORMANCE OF THE FOREGOING REPAIR, RESTORATION, REPLACEMENT OR
REBUILDING AS AGENT MAY REASONABLY REQUIRE AND APPROVE. AGENT MAY, IN ANY EVENT,
REQUIRE THAT ALL PLANS AND SPECIFICATIONS FOR SUCH RESTORATION, REPAIR,
REPLACEMENT AND REBUILDING BE SUBMITTED TO AND REASONABLY APPROVED BY AGENT
PRIOR TO COMMENCEMENT OF WORK. AGENT MAY RETAIN A CONSTRUCTION CONSULTANT TO
INSPECT SUCH WORK AND REVIEW ANY REQUEST BY BORROWER FOR PAYMENTS AND BORROWER
SHALL,

 

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ON DEMAND BY AGENT, REIMBURSE AGENT FOR THE REASONABLE FEES AND DISBURSEMENTS OF
SUCH CONSULTANT. NO PAYMENT MADE PRIOR TO THE FINAL COMPLETION OF THE
RESTORATION, REPAIR, REPLACEMENT AND REBUILDING SHALL EXCEED NINETY PERCENT
(90%) OF THE HARD CONSTRUCTION COSTS VALUE OF THE CONSTRUCTION WORK PERFORMED
FROM TIME TO TIME (EXCEPT FOR RESTORATION WORK ON A TRADE BY TRADE BASIS OR ON
AN HOURLY BASIS FOR PROFESSIONAL SERVICES IN WHICH EVENT, PAYMENT MAY BE MADE IN
FULL UPON THE COMPLETION OF SUCH WORK); FUNDS OTHER THAN CONDEMNATION PROCEEDS
SHALL BE DISBURSED PRIOR TO DISBURSEMENT OF SUCH PROCEEDS; AND AT ALL TIMES, THE
UNDISBURSED BALANCE OF SUCH PROCEEDS REMAINING IN THE HANDS OF AGENT, TOGETHER
WITH FUNDS DEPOSITED FOR THAT PURPOSE OR IRREVOCABLY COMMITTED TO THE REPAYMENT
OF AGENT BY OR ON BEHALF OF BORROWER FOR THAT PURPOSE, SHALL BE AT LEAST
SUFFICIENT IN THE REASONABLE JUDGMENT OF AGENT TO PAY FOR THE COST OF COMPLETION
OF THE RESTORATION, REPAIR, REPLACEMENT OR REBUILDING, FREE AND CLEAR OF ALL
LIENS OR CLAIMS FOR LIEN. ANY SURPLUS WHICH MAY REMAIN OUT OF CONDEMNATION
PROCEEDS HELD BY AGENT AFTER PAYMENT OF SUCH COSTS OF RESTORATION, REPAIR,
REPLACEMENT OR REBUILDING SHALL BE PAID TO BORROWER SO LONG AS NO EVENT OF
DEFAULT HAS OCCURRED AND IS CONTINUING.

 

(C)           IF THE AFFECTED PROPERTY IS SOLD, THROUGH FORECLOSURE OR
OTHERWISE, PRIOR TO THE RECEIPT BY AGENT OF ANY SUCH CONDEMNATION PROCEEDS TO
WHICH IT IS ENTITLED HEREUNDER, AGENT SHALL HAVE THE RIGHT, WHETHER OR NOT A
DEFICIENCY JUDGMENT ON THE NOTE SHALL HAVE BEEN SOUGHT, RECOVERED OR DENIED, TO
HAVE RESERVED IN ANY FORECLOSURE DECREE A RIGHT TO RECEIVE SAID AWARD OR
PAYMENT, OR A PORTION THEREOF SUFFICIENT TO PAY THE INDEBTEDNESS. IN NO CASE
SHALL ANY SUCH APPLICATION REDUCE OR POSTPONE ANY PAYMENTS OTHERWISE REQUIRED
PURSUANT TO THIS AGREEMENT, OTHER THAN THE FINAL PAYMENT ON THE NOTE.

 

(Z)            LEASES AND RENTS.

 

(I)           BORROWER ABSOLUTELY AND UNCONDITIONALLY ASSIGNS TO AGENT,
BORROWER’S RIGHT, TITLE AND INTEREST IN ALL CURRENT AND FUTURE LEASES AND RENTS
AS COLLATERAL FOR THE LOAN, IT BEING INTENDED BY BORROWER THAT THIS ASSIGNMENT
CONSTITUTES A PRESENT, ABSOLUTE ASSIGNMENT AND NOT AN ASSIGNMENT FOR ADDITIONAL
SECURITY ONLY. SUCH ASSIGNMENT TO AGENT SHALL NOT BE CONSTRUED TO BIND AGENT TO
THE PERFORMANCE OF ANY OF THE COVENANTS, CONDITIONS OR PROVISIONS CONTAINED IN
ANY SUCH LEASE OR OTHERWISE IMPOSE ANY OBLIGATION UPON AGENT. BORROWER SHALL
EXECUTE AND DELIVER TO AGENT SUCH ADDITIONAL INSTALLMENTS, IN FORM AND SUBSTANCE
REASONABLY SATISFACTORY TO AGENT, AS MAY HEREAFTER BE REASONABLY REQUESTED IN
WRITING BY AGENT TO FURTHER EVIDENCE AND CONFIRM SUCH ASSIGNMENT. NEVERTHELESS,
SUBJECT TO THE TERMS OF THIS SECTION 5.1(Z), AGENT GRANTS TO BORROWER A LICENSE
TO LEASE, OWN, MAINTAIN, OPERATE AND MANAGE THE PROPERTY AND TO COLLECT, USE AND
APPLY THE RENT, WHICH LICENSE IS REVOCABLE ONLY UPON THE OCCURRENCE AND DURING
THE CONTINUANCE OF AN EVENT OF DEFAULT UNDER THIS AGREEMENT. ANY PORTION OF THE
RENTS HELD BY BORROWER SHALL BE HELD IN TRUST FOR THE BENEFIT OF AGENT FOR USE
IN THE PAYMENT OF THE INDEBTEDNESS. UPON THE OCCURRENCE OF AN EVENT OF DEFAULT
AND DURING THE CONTINUANCE THEREOF, THE LICENSE GRANTED TO BORROWER HEREIN SHALL
AUTOMATICALLY BE REVOKED, AND AGENT SHALL IMMEDIATELY BE ENTITLED TO POSSESSION
OF ALL RENTS, WHETHER OR NOT AGENT ENTERS UPON OR TAKES CONTROL OF THE PROPERTY.
AGENT IS HEREBY GRANTED AND ASSIGNED BY BORROWER THE

 

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RIGHT, AT ITS OPTION, UPON REVOCATION OF THE LICENSE GRANTED HEREIN, TO ENTER
UPON THE PROPERTY IN PERSON, BY AGENT OR BY COURT-APPOINTED RECEIVER TO COLLECT
THE RENTS. ANY RENTS COLLECTED AFTER THE REVOCATION OF THE LICENSE SHALL BE
APPLIED TOWARD PAYMENT OF THE INDEBTEDNESS AS SET FORTH IN SECTION 3.8 HEREOF.

 

(II)           ALL LEASES ENTERED INTO BY BORROWER SHALL PROVIDE FOR RENTAL
RATES COMPARABLE TO THEN-EXISTING LOCAL MARKET RATES AND TERMS AND CONDITIONS
COMMERCIALLY REASONABLE AND CONSISTENT WITH THEN-PREVAILING LOCAL MARKET TERMS
AND CONDITIONS AND OTHERWISE IN FORM AND SUBSTANCE AS IS CUSTOMARY FOR SIMILAR
TYPE PROPERTIES. WITH RESPECT TO ANY LEASE FOR MORE THAN THE GREATER OF (X) 20%
OF THE RENTABLE SQUARE FOOTAGE OF THE PROPERTY OR (Y) 20,000 SQUARE FEET,
BORROWER SHALL NOT ENTER INTO SUCH LEASE, WITHOUT THE PRIOR WRITTEN CONSENT OF
AGENT, SUCH CONSENT NOT TO BE UNREASONABLY WITHHELD OR DELAYED. BORROWER SHALL
FURNISH AGENT WITH (1) DETAILED TERM SHEETS IN ADVANCE IN THE CASE OF ANY
LEASES, MODIFICATIONS, AMENDMENTS OR RENEWALS FOR WHICH AGENT’S CONSENT IS
REQUIRED AND (2) IN THE CASE OF ANY OTHER LEASES, MODIFICATIONS, AMENDMENTS OR
RENEWALS EXECUTED COPIES OF SUCH LEASES UPON WRITTEN REQUEST. ALL RENEWALS OR
AMENDMENTS OR MODIFICATIONS OF LEASES THAT DO NOT SATISFY THE REQUIREMENTS OF
THE FIRST SENTENCE OF THIS SECTION 5.1(Z)(II) SHALL BE SUBJECT TO THE PRIOR
APPROVAL OF AGENT. ALL LEASES EXECUTED AFTER THE DATE HEREOF SHALL PROVIDE THAT
THEY ARE SUBORDINATE TO THE MORTGAGE, AND THAT THE LESSEE AGREES TO ATTORN TO
AGENT. BORROWER,

 

(A)          SHALL OBSERVE AND PERFORM ALL OF THE MATERIAL OBLIGATIONS IMPOSED
UPON THE LESSOR UNDER THE LEASES AND SHALL NOT DO OR PERMIT TO BE DONE ANYTHING
TO MATERIALLY IMPAIR THE VALUE OF THE LEASES AS SECURITY FOR THE INDEBTEDNESS;

 

(B)           SHALL PROMPTLY SEND COPIES TO AGENT OF ALL WRITTEN NOTICES OF
DEFAULT WHICH BORROWER SHALL SEND OR RECEIVE THEREUNDER;

 

(C)           SHALL ENFORCE ALL OF THE MATERIAL TERMS, COVENANTS AND CONDITIONS
CONTAINED IN THE LEASES UPON THE PART OF THE LESSEE THEREUNDER TO BE OBSERVED OR
PERFORMED AND SHALL EFFECT A TERMINATION OR DIMINUTION OF THE OBLIGATIONS OF
TENANTS UNDER LEASES, ONLY IN A MANNER THAT A PRUDENT OWNER OF A SIMILAR
PROPERTY TO THE PROPERTY WOULD ENFORCE SUCH TERMS COVENANTS AND CONDITIONS OR
EFFECT SUCH TERMINATION OR DIMINUTION IN THE ORDINARY COURSE OF BUSINESS;

 

(D)          SHALL NOT COLLECT ANY OF THE RENTS MORE THAN ONE (1) MONTH IN
ADVANCE;

 

(E)           SHALL NOT EXECUTE ANY OTHER ASSIGNMENT OF LESSOR’S INTEREST IN THE
LEASES OR RENTS; AND

 

(F)           SHALL NOT CONVEY OR TRANSFER OR SUFFER OR PERMIT A CONVEYANCE OR
TRANSFER OF THE PROPERTY OR OF ANY INTEREST THEREIN SO AS TO EFFECT A MERGER OF
THE ESTATES AND RIGHTS OF, OR A TERMINATION OR DIMINUTION OF THE OBLIGATIONS OF,
LESSEES THEREUNDER.

 

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(III)         BORROWER SHALL DEPOSIT SECURITY DEPOSITS OF LESSEES WHICH ARE
TURNED OVER TO OR FOR THE BENEFIT OF BORROWER OR OTHERWISE COLLECTED BY OR ON
BEHALF OF BORROWER, INTO AN ELIGIBLE ACCOUNT WITH THE SAME NAME AS THE
COLLECTION ACCOUNT AND SHALL NOT COMMINGLE SUCH FUNDS WITH ANY OTHER FUNDS OF
BORROWER. ANY BOND OR OTHER INSTRUMENT WHICH BORROWER IS PERMITTED TO HOLD IN
LIEU OF CASH SECURITY DEPOSITS UNDER ANY APPLICABLE LEGAL REQUIREMENTS SHALL BE
MAINTAINED IN FULL FORCE AND EFFECT UNLESS REPLACED BY CASH DEPOSITS AS
HEREINABOVE DESCRIBED, SHALL, IF PERMITTED PURSUANT TO LEGAL REQUIREMENTS, NAME
AGENT AS PAYEE OR MORTGAGEE THEREUNDER (OR AT AGENT’S OPTION, BE FULLY
ASSIGNABLE TO AGENT) AND SHALL, IN ALL RESPECTS, COMPLY WITH ANY APPLICABLE
LEGAL REQUIREMENTS AND OTHERWISE BE REASONABLY SATISFACTORY TO AGENT. BORROWER
SHALL, UPON REQUEST, PROVIDE AGENT WITH EVIDENCE REASONABLY SATISFACTORY TO
AGENT OF BORROWER’S COMPLIANCE WITH THE FOREGOING. UPON THE OCCURRENCE AND
DURING THE CONTINUANCE OF ANY EVENT OF DEFAULT, BORROWER SHALL, UPON AGENT’S
REQUEST, IF PERMITTED BY ANY APPLICABLE LEGAL REQUIREMENTS, TURN OVER TO AGENT
THE SECURITY DEPOSITS (AND ANY INTEREST THERETOFORE EARNED THEREON) WITH RESPECT
TO ALL OR ANY PORTION OF THE PROPERTY, TO BE HELD BY AGENT SUBJECT TO THE TERMS
OF THE LEASES.

 

(AA)         MAINTENANCE OF PROPERTY.  BORROWER SHALL CAUSE THE PROPERTY TO BE
MAINTAINED IN A GOOD AND SAFE CONDITION AND REPAIR, SUBJECT TO WEAR AND TEAR AND
DAMAGE CAUSED BY CASUALTY OR CONDEMNATION. THE IMPROVEMENTS AND THE EQUIPMENT
SHALL NOT BE REMOVED, DEMOLISHED OR ALTERED (EXCEPT FOR NORMAL REPLACEMENT OF
THE EQUIPMENT, IMPROVEMENTS CONTEMPLATED IN AN APPROVED OPERATING BUDGET OR
PURSUANT TO LEASES IN EFFECT FROM TIME TO TIME OR FOR REMOVALS, DEMOLITION OR
ALTERATIONS THAT COST UP TO $50,000) WITHOUT THE CONSENT OF THE AGENT WHICH
CONSENT SHALL NOT BE UNREASONABLY WITHHELD. EXCEPT WITH RESPECT TO AN INSURED
CASUALTY WHICH SHALL BE GOVERNED BY THE TERMS AND CONDITIONS PROVIDED HEREIN,
BORROWER SHALL, OR SHALL CAUSE ANY TENANTS OBLIGATED UNDER THEIR RESPECTIVE
LEASES TO, PROMPTLY REPAIR, REPLACE OR REBUILD ANY PART OF THE PROPERTY THAT
BECOMES DAMAGED, WORN OR DILAPIDATED EXCEPT WHERE THE FAILURE TO DO SO IS NOT
REASONABLY LIKELY TO HAVE A MATERIAL ADVERSE EFFECT. BORROWER SHALL COMPLETE AND
PAY FOR ANY STRUCTURE AT ANY TIME IN THE PROCESS OF CONSTRUCTION OR REPAIR ON
THE LAND. BORROWER SHALL NOT INITIATE, JOIN IN, OR CONSENT TO ANY CHANGE IN ANY
PRIVATE RESTRICTIVE COVENANT, ZONING LAW OR OTHER PUBLIC OR PRIVATE RESTRICTION,
LIMITING OR DEFINING THE USES WHICH MAY BE MADE OF THE PROPERTY OR ANY PART
THEREOF WHICH CAN BE REASONABLY LIKELY TO RESULT IN A MATERIAL ADVERSE EFFECT
WITHOUT CONSENT OF THE AGENT. IF UNDER APPLICABLE ZONING PROVISIONS THE USE OF
ALL OR ANY PORTION OF THE PROPERTY IS OR SHALL BECOME A NONCONFORMING USE,
BORROWER WILL NOT CAUSE OR PERMIT SUCH NONCONFORMING USE TO BE DISCONTINUED OR
ABANDONED IF SUCH DISCONTINUANCE OF ABANDONMENT WOULD CAUSE SUCH NONCONFORMING
USE TO NO LONGER BE PERMITTED WITHOUT THE EXPRESS WRITTEN CONSENT OF THE AGENT.
BORROWER SHALL NOT (I) CHANGE THE USE OF THE LAND IN ANY MATERIAL RESPECT,
(II) PERMIT OR SUFFER TO OCCUR ANY WASTE ON OR TO THE PROPERTY OR TO ANY PORTION
THEREOF OR (III) TAKE ANY STEPS WHATSOEVER TO CONVERT THE PROPERTY, OR ANY
PORTION THEREOF, TO A CONDOMINIUM OR COOPERATIVE FORM OF MANAGEMENT.

 

(BB)         TAXES ON SECURITY.  BORROWER SHALL PAY ALL TAXES, CHARGES, FILING,
REGISTRATION AND RECORDING FEES, EXCISES AND LEVIES PAYABLE WITH RESPECT TO THE
NOTE OR THE LIEN CREATED OR SECURED BY THE LOAN DOCUMENTS, OTHER THAN INCOME,
FRANCHISE AND DOING BUSINESS TAXES IMPOSED ON AGENT, ANY LENDER OR COLLATERAL
AGENT. IF THERE SHALL BE ENACTED ANY LAW (1) DEDUCTING THE LOAN FROM THE VALUE
OF THE COLLATERAL FOR THE PURPOSE OF TAXATION, (2) AFFECTING

 

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AGENT’S LIEN ON THE COLLATERAL OR (3) CHANGING EXISTING LAWS OF TAXATION OF
MORTGAGES, DEEDS OF TRUST, SECURITY DEEDS, OR DEBTS SECURED BY REALTY, OR
CHANGING THE MANNER OF COLLECTING ANY SUCH TAXES, BORROWER SHALL PROMPTLY PAY TO
AGENT, ON DEMAND, ALL TAXES, COSTS AND CHARGES FOR WHICH AGENT IS OR MAY BE
LIABLE AS A RESULT THEREOF; PROVIDED, HOWEVER, IF SUCH PAYMENT WOULD BE
PROHIBITED BY LAW OR WOULD RENDER THE LOAN USURIOUS, THEN INSTEAD OF COLLECTING
SUCH PAYMENT, AGENT MAY DECLARE ALL AMOUNTS OWING UNDER THE LOAN DOCUMENTS TO BE
IMMEDIATELY DUE AND PAYABLE.

 

(CC)         GROUND LEASE.

 

(I)           THE BORROWER SHALL PAY, PROMPTLY WHEN DUE AND PAYABLE, ALL GROUND
RENT. UPON NOTICE FROM AGENT, SIMULTANEOUSLY WITH THE MAKING OF EACH AND EVERY
PAYMENT OF GROUND RENT PAYABLE AFTER THE DELIVERY OF SUCH NOTICE, THE BORROWER
SHALL SIMULTANEOUSLY DELIVER TO AGENT A COPY OF THE CHECK IN THE AMOUNT OF SUCH
PAYMENT DELIVERED TO THE PAYEE.

 

(II)          THE BORROWER SHALL PERFORM AND OBSERVE ALL TERMS, COVENANTS, AND
CONDITIONS THAT BORROWER IS REQUIRED TO PERFORM AND OBSERVE UNDER THE GROUND
LEASE AND DO EVERYTHING NECESSARY TO PRESERVE AND TO KEEP UNIMPAIRED AND IN FULL
FORCE AND EFFECT THE GROUND LEASE. THE BORROWER SHALL NOT PERMIT THE GROUND
LEASE TO GO INTO DEFAULT (WHETHER OR NOT ANY CURE PERIOD IN THE GROUND LEASE HAS
EXPIRED).

 

(III)         THE BORROWER SHALL ENFORCE THE OBLIGATIONS OF THE APPLICABLE
LESSOR UNDER THE GROUND LEASE SO THAT THE BORROWER MAY AT ALL TIMES ENJOY ALL
ITS RIGHTS, BENEFITS AND PRIVILEGES UNDER THE APPLICABLE GROUND LEASE.

 

(IV)         THE BORROWER SHALL NOT, WITHOUT AGENT’S CONSENT, CAUSE, AGREE TO,
PERMIT, OR SUFFER TO OCCUR ANY GROUND LEASE IMPAIRMENT. ANY GROUND LEASE
IMPAIRMENT MADE WITHOUT AGENT’S CONSENT SHALL BE NULL, VOID, AND OF NO FORCE OF
EFFECT. ANY PARTY ENTERING INTO OR PURPORTEDLY OBTAINING THE BENEFIT OF SUCH A
PURPORTED GROUND LEASE IMPAIRMENT IS HEREBY PLACED ON NOTICE THAT BORROWER HAS
NO POWER OR AUTHORITY TO CAUSE, CONSENT, OR AGREE TO SUCH GROUND LEASE
IMPAIRMENT WITHOUT AGENT’S CONSENT.

 

(V)          THE BORROWER SHALL NOT, WITHOUT AGENT’S CONSENT, REFUSE TO CONSENT
OR CONSENT TO ANY ACTION THAT ANY LESSOR UNDER A GROUND LEASE OR ANY THIRD PARTY
TAKES OR DESIRES TO TAKE UNDER OR WITH RESPECT TO THE GROUND LEASE.

 

(VI)         THE BORROWER SHALL PROMPTLY DELIVER TO AGENT A COPY OF ANY NOTICE
OF DEFAULT OR TERMINATION, OR DEMANDS FOR PERFORMANCE (OTHER THAN ROUTINE BILLS
FOR CURRENT GROUND RENT) THAT IT RECEIVES FROM THE LESSOR UNDER THE GROUND
LEASE. THE BORROWER SHALL FURNISH TO AGENT ALL INFORMATION THAT AGENT MAY
REQUEST FROM TIME TO TIME CONCERNING THE GROUND LEASE AND BORROWER’S COMPLIANCE
WITH THE GROUND LEASE. BORROWER, IMMEDIATELY UPON LEARNING THAT THE LESSOR UNDER
THE GROUND LEASE HAS FAILED TO PERFORM THE TERMS AND PROVISIONS UNDER THE GROUND
LEASE (INCLUDING BY REASON OF A REJECTION OR DISAFFIRMANCE OR PURPORTED
REJECTION OR DISAFFIRMANCE OF THE GROUND LEASE PURSUANT TO ANY STATE OR FEDERAL
BANKRUPTCY LAW), SHALL NOTIFY AGENT THEREOF. PROMPTLY AFTER THE ADVANCE CLOSING
DATE THEREFOR, AND AGAIN PROMPTLY AFTER EXECUTION OF ANY

 

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AMENDMENT TO THE RELATED MORTGAGE, BORROWER SHALL NOTIFY THE APPLICABLE GROUND
LESSOR OF THE EXECUTION AND DELIVERY OF THE RELATED LEASEHOLD MORTGAGE OR SUCH
AMENDMENT. SUCH NOTICE SHALL SET FORTH, VERBATIM, IN A FORM SATISFACTORY TO
AGENT, ALL PROVISIONS OF THE RELATED LEASEHOLD MORTGAGE RELATING TO GROUND LEASE
IMPAIRMENTS. AGENT SHALL HAVE THE RIGHT, BUT NOT THE OBLIGATION, TO GIVE ANY
LESSOR UNDER A GROUND LEASE AT ANY TIME ANY NOTICE DESCRIBED IN THIS PARAGRAPH
OR OTHERWISE RELATING TO THE RELATED LEASEHOLD MORTGAGE OR THE LOAN.

 

(VII)        THE BORROWER SHALL PROMPTLY NOTIFY AGENT OF ANY REQUEST THAT ANY
PARTY TO THE GROUND LEASE MAKES FOR ARBITRATION OR OTHER DISPUTE RESOLUTION
PROCEDURE PURSUANT TO THE GROUND LEASE AND OF THE INSTITUTION OF ANY SUCH
ARBITRATION OR DISPUTE RESOLUTION. THE BORROWER HEREBY AUTHORIZES AGENT TO
PARTICIPATE IN ANY SUCH ARBITRATION OR DISPUTE RESOLUTION. SUCH PARTICIPATION
MAY, AT AGENT’S OPTION, BE TO THE EXCLUSION OF, AND IN PLACE OF, THE BORROWER.
THE BORROWER SHALL PROMPTLY DELIVER TO AGENT A COPY OF THE DETERMINATION OF EACH
SUCH ARBITRATION OR DISPUTE RESOLUTION MECHANISM.

 

(VIII)       IF AGENT OR ITS DESIGNEE SHALL ACQUIRE OR OBTAIN A NEW GROUND
LEASE, THEN BORROWER SHALL HAVE NO RIGHT, TITLE OR INTEREST WHATSOEVER IN OR TO
SUCH NEW GROUND LEASE, OR ANY PROCEEDS OR INCOME ARISING FROM THE ESTATE ARISING
UNDER ANY SUCH NEW GROUND LEASE, INCLUDING FROM ANY SALE OR OTHER DISPOSITION
THEREOF. AGENT OR ITS DESIGNEE SHALL HOLD SUCH NEW GROUND LEASE FREE AND CLEAR
OF ANY RIGHT OR CLAIM OF BORROWER.

 

(IX)         BORROWER SHALL NOT AMEND, MODIFY OR CANCEL THE GROUND LEASE.

 

(DD)         MONTHLY STATEMENTS.  BORROWER SHALL FURNISH TO AGENT, NOT LATER
THAN TEN (10) DAYS AFTER THE END OF EACH CALENDAR MONTH, A STATEMENT DETAILING
THE ASSETS THAT HAVE BEEN FINANCED BY AGENT WITH THE PROCEEDS OF AN ADVANCE AND
REMAIN ENCUMBERED UNDER THE LOAN, AS OF THE LAST DAY OF THE APPLICABLE CALENDAR
MONTH.

 

(EE)         OFAC.  AT ALL TIMES THROUGHOUT THE TERM OF THE LOAN, BORROWER AND
GUARANTOR AND THEIR RESPECTIVE AFFILIATES SHALL BE IN FULL COMPLIANCE WITH ALL
APPLICABLE ORDERS, RULES, REGULATIONS AND RECOMMENDATIONS OF THE OFFICE OF
FOREIGN ASSETS CONTROL OF THE U.S. DEPARTMENT OF THE TREASURY.

 

ARTICLE VI.
NEGATIVE COVENANTS

 

SECTION 6.1.            NEGATIVE COVENANTS.  BORROWER COVENANTS AND AGREES THAT,
UNTIL PAYMENT IN FULL OF THE INDEBTEDNESS, IT WILL NOT DO, DIRECTLY OR
INDIRECTLY, ANY OF THE FOLLOWING UNLESS AGENT CONSENTS THERETO IN WRITING:

 

(A)           LIENS ON THE PROPERTY.  INCUR, CREATE, ASSUME, BECOME OR BE LIABLE
IN ANY MANNER WITH RESPECT TO, OR PERMIT TO EXIST, EXCEPT AS PERMITTED BY THE
MORTGAGE, ANY LIEN WITH RESPECT TO THE PROPERTY, EXCEPT:  (I) LIENS IN FAVOR OF
THE LENDERS AND (II) THE PERMITTED ENCUMBRANCES.

 

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(B)           OWNERSHIP AND TRANSFER.  EXCEPT AS EXPRESSLY PERMITTED BY OR
PURSUANT TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS, OWN ANY PROPERTY OF ANY
KIND OTHER THAN THE PROPERTY, OR TRANSFER THE PROPERTY OR ANY PORTION THEREOF.

 

(C)           OTHER BORROWINGS.  INCUR, CREATE, ASSUME, BECOME OR BE LIABLE IN
ANY MANNER WITH RESPECT TO OTHER BORROWINGS.

 

(D)           DISSOLUTION; MERGER OR CONSOLIDATION.  DISSOLVE, TERMINATE,
LIQUIDATE, MERGE WITH OR CONSOLIDATE INTO ANOTHER PERSON.

 

(E)           CHANGE IN BUSINESS.  CEASE TO BE A SINGLE-PURPOSE ENTITY, OR MAKE
ANY MATERIAL CHANGE IN THE SCOPE OR NATURE OF ITS BUSINESS OBJECTIVES, PURPOSES
OR OPERATIONS, OR UNDERTAKE OR PARTICIPATE IN ACTIVITIES OTHER THAN THE
CONTINUANCE OF ITS PRESENT BUSINESS.

 

(F)            DEBT CANCELLATION.  CANCEL OR OTHERWISE FORGIVE OR RELEASE ANY
MATERIAL CLAIM OR DEBT OWED TO BORROWER BY ANY PERSON, EXCEPT FOR ADEQUATE
CONSIDERATION OR IN THE ORDINARY COURSE OF BORROWER’S BUSINESS.

 

(G)           AFFILIATE TRANSACTIONS.  ENTER INTO, OR BE A PARTY TO, ANY
TRANSACTION WITH AN AFFILIATE OF BORROWER, EXCEPT IN THE ORDINARY COURSE OF
BUSINESS AND ON TERMS WHICH ARE FULLY DISCLOSED TO AGENT IN ADVANCE AND ON TERMS
WHICH ARE NO LESS FAVORABLE TO BORROWER OR SUCH AFFILIATE THAN WOULD BE OBTAINED
IN A COMPARABLE ARM’S LENGTH TRANSACTION WITH AN UNRELATED THIRD PARTY (OTHER
THAN THE MANAGEMENT AGREEMENT).

 

(H)           CREATION OF EASEMENTS.  EXCEPT AS EXPRESSLY PERMITTED BY OR
PURSUANT TO THE MORTGAGE OR THIS AGREEMENT, CREATE, OR PERMIT THE PROPERTY OR
ANY PART THEREOF TO BECOME SUBJECT TO, ANY EASEMENT, LICENSE OR RESTRICTIVE
COVENANT, OTHER THAN A PERMITTED ENCUMBRANCE, PROVIDED, THAT THE CONSENT OF
AGENT SHALL NOT BE UNREASONABLY WITHHELD OR DELAYED TO THE EXTENT THAT ANY SUCH
EASEMENT, LICENSE OR RESTRICTIVE COVENANT IS REASONABLY NECESSARY FOR THE
CONTINUED USE, ENJOYMENT, ACCESS TO OR OPERATION OF THE APPLICABLE PROPERTY.

 

(I)            MISAPPLICATION OF FUNDS.  DISTRIBUTE ANY RENTS OR MONEYS RECEIVED
FROM ACCOUNTS IN VIOLATION OF THE PROVISIONS OF SECTION 3.12, OR FAIL TO PLEDGE
ANY SECURITY DEPOSIT TO AGENT, OR MISAPPROPRIATE ANY SECURITY DEPOSIT OR PORTION
THEREOF.

 

(J)            CERTAIN RESTRICTIONS.  ENTER INTO ANY AGREEMENT THAT EXPRESSLY
RESTRICTS THE ABILITY OF BORROWER TO ENTER INTO AMENDMENTS, MODIFICATIONS OR
WAIVERS OF ANY OF THE LOAN DOCUMENTS.

 

(K)           ASSIGNMENT OF LICENSES AND PERMITS.  ASSIGN OR TRANSFER ANY OF ITS
INTEREST IN ANY PERMITS PERTAINING TO THE PROPERTY, OR ASSIGN, TRANSFER OR
REMOVE OR PERMIT ANY OTHER PERSON TO ASSIGN, TRANSFER OR REMOVE ANY RECORDS
PERTAINING TO THE PROPERTY.

 

(L)            PLACE OF ORGANIZATION.  CHANGE ITS JURISDICTION OF ORGANIZATION,
CREATION OR FORMATION, AS APPLICABLE, WITHOUT GIVING AGENT AT LEAST FIFTEEN (15)
DAYS’ PRIOR WRITTEN NOTICE THEREOF AND PROMPTLY PROVIDING AGENT SUCH INFORMATION
AS AGENT MAY REASONABLY REQUEST IN CONNECTION THEREWITH.

 

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(M)          LEASES.  ENTER INTO, AMEND OR CANCEL LEASES, EXCEPT AS PERMITTED BY
OR PURSUANT TO OR WOULD NOT RESULT IN A VIOLATION OF THIS AGREEMENT.

 

(N)           MANAGEMENT AGREEMENT.  EXCEPT IN ACCORDANCE WITH THIS AGREEMENT,
(I) TERMINATE OR CANCEL THE MANAGEMENT AGREEMENT, (II) CONSENT TO EITHER THE
REDUCTION OF THE TERM OF OR THE ASSIGNMENT OF THE MANAGEMENT AGREEMENT,
(III) INCREASE OR CONSENT TO THE INCREASE OF THE AMOUNT OF ANY CHARGES UNDER THE
MANAGEMENT AGREEMENT, OR (IV) OTHERWISE MODIFY, CHANGE, SUPPLEMENT, ALTER OR
AMEND, OR WAIVE OR RELEASE ANY OF ITS RIGHTS AND REMEDIES UNDER, THE MANAGEMENT
AGREEMENT IN ANY MATERIAL RESPECT.

 

(O)           PLANS AND WELFARE PLANS.  KNOWINGLY ENGAGE IN OR PERMIT ANY
TRANSACTION IN CONNECTION WITH WHICH BORROWER OR ANY ERISA AFFILIATE COULD BE
SUBJECT TO EITHER A MATERIAL CIVIL PENALTY OR TAX ASSESSED PURSUANT TO
SECTION 502(I) OR 502(1) OF ERISA OR SECTION 4975 OF THE CODE, PERMIT ANY
WELFARE PLAN TO PROVIDE BENEFITS, INCLUDING WITHOUT LIMITATION, MEDICAL BENEFITS
(WHETHER OR NOT INSURED), WITH RESPECT TO ANY CURRENT OR FORMER EMPLOYEE OF
BORROWER BEYOND HIS OR HER RETIREMENT OR OTHER TERMINATION OF SERVICE OTHER THAN
(I) COVERAGE MANDATED BY APPLICABLE LAW, (II) DEATH OR DISABILITY BENEFITS THAT
HAVE BEEN FULLY PROVIDED FOR BY PAID UP INSURANCE OR OTHERWISE OR
(III) SEVERANCE BENEFITS (UNLESS SUCH COVERAGE IS PROVIDED AFTER NOTIFICATION OF
AND WITH THE REASONABLE APPROVAL OF AGENT), PERMIT THE ASSETS OF BORROWER TO
BECOME “PLAN ASSETS”, WHETHER BY OPERATION OF LAW OR UNDER REGULATIONS
PROMULGATED UNDER ERISA OR ADOPT, AMEND (EXCEPT AS MAY BE REQUIRED BY APPLICABLE
LAW) OR INCREASE THE AMOUNT OF ANY BENEFIT OR AMOUNT PAYABLE UNDER, OR PERMIT
ANY ERISA AFFILIATE TO ADOPT, AMEND (EXCEPT AS MAY BE REQUIRED BY APPLICABLE
LAW) OR INCREASE THE AMOUNT OF ANY BENEFIT OR AMOUNT PAYABLE UNDER, ANY PLAN OR
WELFARE PLAN, EXCEPT FOR NORMAL INCREASES IN THE ORDINARY COURSE OF BUSINESS
CONSISTENT WITH PAST PRACTICE THAT, IN THE AGGREGATE, DO NOT RESULT IN A
MATERIAL INCREASE IN BENEFITS EXPENSE TO BORROWER OR ANY ERISA AFFILIATE.

 

(P)           TRANSFER OF OWNERSHIP INTERESTS.  PERMIT ANY TRANSFER OF A DIRECT
OR INDIRECT OWNERSHIP INTEREST OR VOTING RIGHT IN BORROWER, OTHER THAN (I) AS
CONTEMPLATED IN SECTION 3.11 ABOVE, OR (II) A PERMITTED TRANSFER.

 

(Q)           EQUIPMENT AND INVENTORY.  EXCEPT PURSUANT TO THE MANAGEMENT
AGREEMENT, PERMIT ANY EQUIPMENT OWNED BY BORROWER TO BE REMOVED AT ANY TIME FROM
THE PROPERTY UNLESS THE REMOVED ITEM IS CONSUMED OR SOLD IN THE USUAL AND
CUSTOMARY COURSE OF BUSINESS, REMOVED TEMPORARILY FOR MAINTENANCE AND REPAIR OR,
IF REMOVED PERMANENTLY, REPLACED BY AN ARTICLE OF EQUIVALENT SUITABILITY AND NOT
MATERIALLY LESS VALUE, OWNED BY BORROWER FREE AND CLEAR OF ANY LIEN.

 

(R)            MANAGEMENT FEES.  PAY BORROWER OR ANY AFFILIATE OF BORROWER ANY
MANAGEMENT FEES WITH RESPECT TO THE PROPERTY EXCEPT AS CONTEMPLATED BY THE
MANAGEMENT AGREEMENT.

 

(S)           PROHIBITED PERSONS.  WITH RESPECT TO BORROWER AND GUARANTOR AND
ANY OF THEIR RESPECTIVE OFFICERS, DIRECTORS, SHAREHOLDERS, PARTNERS, MEMBERS OR
AFFILIATES, IF APPLICABLE (INCLUDING, WITHOUT LIMITATION, THE INDIRECT HOLDERS
OF EQUITY INTERESTS IN BORROWER AND GUARANTOR):  (I) CONDUCT ANY BUSINESS, NOR
ENGAGE IN ANY TRANSACTION OR DEALING, WITH ANY PROHIBITED PERSON, INCLUDING, BUT
NOT LIMITED TO, THE MAKING OR RECEIVING OF ANY CONTRIBUTION OF

 

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FUNDS, GOODS, OR SERVICES, TO OR FOR THE BENEFIT OF A PROHIBITED PERSON; OR
(II) ENGAGE IN OR CONSPIRE TO ENGAGE IN ANY TRANSACTION THAT EVADES OR AVOIDS,
OR HAS THE PURPOSE OF EVADING OR AVOIDING, OR ATTEMPTS TO VIOLATE, ANY OF THE
PROHIBITIONS SET FORTH IN EO13224.

 

ARTICLE VII.
EVENT OF DEFAULT

 

SECTION 7.1.            EVENT OF DEFAULT.  THE OCCURRENCE OF ONE OR MORE OF THE
FOLLOWING EVENTS SHALL BE AN “EVENT OF DEFAULT” HEREUNDER:

 

(A)           IF ON ANY PAYMENT DATE BORROWER FAILS TO PAY ANY ACCRUED AND
UNPAID INTEREST ON THE LOAN THEN DUE AND PAYABLE OR ANY PRINCIPAL PAYMENT AMOUNT
THEN DUE AND PAYABLE IN ACCORDANCE WITH THE PROVISIONS OF SECTION 3.7 HEREOF;

 

(B)           IF BORROWER FAILS (A) TO PAY (1) THE OUTSTANDING INDEBTEDNESS ON
THE MATURITY DATE OR (2) THE FEES THEN DUE AND PAYABLE TO COLLATERAL AGENT
PURSUANT TO THE FEE LETTER ON ANY PAYMENT DATE; OR (B) TO DEPOSIT INTO THE
COLLECTION ACCOUNT, THE AMOUNT REQUIRED PURSUANT TO SECTION 3.7(B),
RESPECTIVELY;

 

(C)           IF BORROWER FAILS TO MAKE ANY REQUIRED DEPOSIT TO A RESERVE
ACCOUNT OR TO PAY ANY OTHER AMOUNT PAYABLE PURSUANT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT WHEN DUE AND PAYABLE IN ACCORDANCE WITH THE PROVISIONS
HEREOF OR THEREOF, AS THE CASE MAY BE, AND SUCH FAILURE CONTINUES FOR TEN
(10) DAYS AFTER AGENT DELIVERS WRITTEN NOTICE THEREOF TO BORROWER;

 

(D)           IF ANY REPRESENTATION OR WARRANTY MADE HEREIN OR IN ANY OTHER LOAN
DOCUMENT, OR IN ANY REPORT, CERTIFICATE, FINANCIAL STATEMENT OR OTHER
INSTRUMENT, AGREEMENT OR DOCUMENT FURNISHED BY BORROWER, GENERAL PARTNER, 4200
HOLDINGS OR GUARANTOR IN CONNECTION WITH THIS AGREEMENT, THE NOTE, THE GUARANTY
OR ANY OTHER LOAN DOCUMENT EXECUTED AND DELIVERED BY ANY BORROWER, GENERAL
PARTNER, 4200 HOLDINGS OR GUARANTOR SHALL BE FALSE IN ANY MATERIAL RESPECT AS OF
THE DATE SUCH REPRESENTATION OR WARRANTY WAS MADE (OR IF SUCH REPRESENTATION OR
WARRANTY RELATES TO AN EARLIER DATE, THEN AS OF SUCH EARLIER DATE);

 

(E)           IF BORROWER, GENERAL PARTNER, 4200 HOLDINGS OR THE GUARANTOR MAKES
AN ASSIGNMENT FOR THE BENEFIT OF CREDITORS;

 

(F)            IF A RECEIVER, LIQUIDATOR OR TRUSTEE SHALL BE APPOINTED FOR
BORROWER OR THE GUARANTOR OR IF BORROWER OR THE GUARANTOR SHALL BE ADJUDICATED A
BANKRUPT OR INSOLVENT, OR IF ANY PETITION FOR BANKRUPTCY, REORGANIZATION OR
ARRANGEMENT PURSUANT TO FEDERAL BANKRUPTCY LAW, OR ANY SIMILAR FEDERAL OR STATE
LAW, SHALL BE FILED BY OR AGAINST, CONSENTED TO, OR ACQUIESCED IN BY, BORROWER
OR THE GUARANTOR, OR IF ANY PROCEEDING FOR THE DISSOLUTION OR LIQUIDATION OF
BORROWER OR THE GUARANTOR SHALL BE INSTITUTED; PROVIDED, HOWEVER, THAT IF SUCH
APPOINTMENT, ADJUDICATION, PETITION OR PROCEEDING WAS INVOLUNTARY AND NOT
CONSENTED TO BY BORROWER OR THE GUARANTOR, UPON THE SAME NOT BEING DISCHARGED,
STAYED OR DISMISSED WITHIN NINETY (90) DAYS, OR IF BORROWER OR THE GUARANTOR
SHALL GENERALLY NOT BE PAYING ITS DEBTS AS THEY BECOME DUE;

 

(G)           IF BORROWER, GENERAL PARTNER, 4200 HOLDINGS OR GUARANTOR ATTEMPTS
TO DELEGATE ITS OBLIGATIONS OR ASSIGN ITS RIGHTS UNDER THIS AGREEMENT, THE
GUARANTY, ANY OF THE OTHER

 

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LOAN DOCUMENTS OR ANY INTEREST HEREIN OR THEREIN, OR IF ANY TRANSFER OCCURS
OTHER THAN IN ACCORDANCE WITH OR AS PERMITTED UNDER THIS AGREEMENT;

 

(H)           IF ANY PROVISION OF THE ORGANIZATIONAL AGREEMENT AFFECTING THE
PURPOSE FOR WHICH THE BORROWER, 4200 HOLDINGS OR GENERAL PARTNER IS FORMED IS
AMENDED OR MODIFIED IN ANY MATERIAL RESPECT WHICH IS REASONABLY LIKELY TO
ADVERSELY AFFECT THE LENDERS, AGENT OR COLLATERAL AGENT, OR IF BORROWER, 4200
HOLDINGS OR GENERAL PARTNER FAILS TO PERFORM OR ENFORCE THE PROVISIONS OF THE
ORGANIZATIONAL AGREEMENT AND SUCH FAILURE HAS A MATERIAL ADVERSE EFFECT OR
ATTEMPTS TO DISSOLVE BORROWER WITHOUT AGENT’S CONSENT;

 

(I)            IF AN EVENT OF DEFAULT AS DEFINED OR DESCRIBED IN THE NOTE OR ANY
OTHER LOAN DOCUMENT OCCURS, WHETHER AS TO BORROWER OR THE PROPERTY OR ANY
PORTION THEREOF;

 

(J)            IF BORROWER FAILS TO MAINTAIN ANY INSURANCE REQUIRED TO BE
MAINTAINED PURSUANT TO SECTION 5.1(X) HEREOF;

 

(K)           IF GUARANTOR SHALL FAIL TO OBSERVE ANY OF THE FINANCIAL COVENANTS
SET FORTH IN PARAGRAPH 2 OF THE GUARANTY, SHALL FAIL TO PAY THE AMOUNT SPECIFIED
IN PARAGRAPH 1(II) OF THE GUARANTY WHEN AND IF DUE THEREUNDER OR THE GUARANTY
SHALL HAVE BEEN TERMINATED OR RENDERED INVALID FOR ANY REASON;

 

(L)            IF ANY GOVERNMENTAL, REGULATORY, OR SELF-REGULATORY AUTHORITY
SHALL HAVE REMOVED, RESTRICTED, SUSPENDED OR TERMINATED THE RIGHTS, PRIVILEGES,
OR OPERATIONS OF BORROWER OR GUARANTOR WHICH HAS A MATERIAL ADVERSE EFFECT ON
THE FINANCIAL CONDITION OR BUSINESS OPERATIONS OF EITHER OF THEM;

 

(M)          IF AN UNAPPEALABLE FINAL JUDGMENT BY ANY COMPETENT COURT IN THE
UNITED STATES OF AMERICA FOR THE PAYMENT OF MONEY IN AN AMOUNT GREATER THAN
$250,000 SHALL HAVE BEEN RENDERED AGAINST BORROWER OR, AN UNAPPEALABLE FINAL
JUDGMENT BY ANY COMPETENT COURT IN THE UNITED STATES OF AMERICA FOR THE PAYMENT
OF MONEY IN AN AMOUNT GREATER THAN $5 MILLION SHALL HAVE BEEN RENDERED AGAINST
THE GUARANTOR AND, IN EACH CASE, REMAINED UNDISCHARGED OR UNPAID FOR A PERIOD OF
SIXTY (60) DAYS, DURING WHICH PERIOD EXECUTION OF SUCH JUDGMENT IS NOT
EFFECTIVELY STAYED BY BONDING OVER OR OTHER MEANS ACCEPTABLE TO AGENT;

 

(N)           IF GUARANTOR SHALL HAVE DEFAULTED OR FAILED TO PERFORM UNDER ANY
NOTE, INDENTURE, LOAN AGREEMENT, GUARANTY, SWAP AGREEMENT OR ANY OTHER CONTRACT,
AGREEMENT OR TRANSACTION TO WHICH IT IS A PARTY, WHICH DEFAULT (A) INVOLVES THE
FAILURE TO PAY A MONETARY OBLIGATION IN AN AMOUNT GREATER THAN $5 MILLION, OR
(B) RESULTS IN THE ACCELERATION OF THE MATURITY OF OBLIGATIONS BY ANY OTHER
PARTY TO OR BENEFICIARY OF SUCH NOTE, INDENTURE, LOAN AGREEMENT, GUARANTY, SWAP
AGREEMENT OR OTHER CONTRACT AGREEMENT OR TRANSACTION; PROVIDED, HOWEVER, THAT
ANY SUCH DEFAULT, FAILURE TO PERFORM OR BREACH SHALL NOT CONSTITUTE AN EVENT OF
DEFAULT IF GUARANTOR CURES SUCH DEFAULT, FAILURE TO PERFORM OR BREACH, AS THE
CASE MAY BE, WITHIN THE GREATER OF THIRTY (30) DAYS OR THE GRACE PERIOD, IF ANY,
PROVIDED UNDER THE APPLICABLE AGREEMENT; AND

 

(O)           IF BORROWER OR GUARANTOR SHALL FAIL TO PERFORM ANY OF THE TERMS,
COVENANTS OR CONDITIONS OF THIS AGREEMENT, THE NOTE, THE MORTGAGE, THE GUARANTY
OR THE OTHER LOAN DOCUMENTS, OTHER THAN AS SPECIFICALLY OTHERWISE REFERRED TO
ABOVE IN THIS DEFINITION OF “EVENT OF

 

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DEFAULT,” FOR TEN (10) DAYS AFTER NOTICE TO BORROWER OR GUARANTOR, AS
APPLICABLE, FROM AGENT OR ITS SUCCESSORS OR ASSIGNS, IN THE CASE OF ANY DEFAULT
WHICH CAN BE CURED BY THE PAYMENT OF A SUM OF MONEY (OTHER THAN EVENTS OF
DEFAULT PURSUANT TO SECTIONS 7.1(A) AND 7.1(B) ABOVE AS TO WHICH THE GRACE
PERIOD, IF ANY, SET FORTH THEREIN IS APPLICABLE), OR FOR THIRTY (30) DAYS AFTER
NOTICE FROM AGENT OR ITS SUCCESSORS OR ASSIGNS, IN THE CASE OF ANY OTHER DEFAULT
(UNLESS A LONGER NOTICE PERIOD IS OTHERWISE PROVIDED HEREIN OR IN SUCH OTHER
LOAN DOCUMENT); PROVIDED, HOWEVER, THAT IF SUCH NON-MONETARY DEFAULT IS
SUSCEPTIBLE OF CURE BUT CANNOT REASONABLY BE CURED WITHIN SUCH THIRTY (30) DAY
PERIOD AND SUCH BORROWER OR GUARANTOR, AS APPLICABLE, SHALL HAVE COMMENCED TO
CURE SUCH DEFAULT WITHIN SUCH THIRTY (30) DAY PERIOD AND THEREAFTER DILIGENTLY
AND EXPEDITIOUSLY PROCEEDS TO CURE THE SAME, SUCH THIRTY (30) DAY PERIOD SHALL
BE EXTENDED FOR AN ADDITIONAL THIRTY (30) DAYS;

 

then, upon the occurrence of any such Event of Default and at any time
thereafter, Agent or Collateral Agent or its successors or assigns, may, in
addition to any other rights or remedies available to it pursuant to this
Agreement, the Guaranty and the other Loan Documents, or at law or in equity,
take such action, without further notice or demand, as Agent on behalf of the
Lenders or its successors or assigns, deems advisable to protect and enforce its
rights against Borrower or Guarantor, as applicable, and in and to all or any
portion of the Collateral (including, without limitation, declaring the entire
Indebtedness to be immediately due and payable) and may enforce or avail itself
of any or all rights or remedies provided in the Loan Documents against
Borrower, Guarantor and/or the Collateral (including, without limitation, all
rights or remedies available at law or in equity).

 

SECTION 7.2.            REMEDIES.

 

(A)           UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, ALL OR ANY ONE OR MORE
OF THE RIGHTS, POWERS, OTHER REMEDIES AVAILABLE TO AGENT OR COLLATERAL AGENT OR
THE LENDERS AGAINST BORROWER UNDER THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS EXECUTED BY OR WITH RESPECT TO BORROWER, OR AT LAW OR IN EQUITY MAY BE
EXERCISED BY LENDERS AT ANY TIME AND FROM TIME TO TIME, WHETHER OR NOT ALL OR
ANY PORTION OF THE INDEBTEDNESS SHALL BE DECLARED DUE AND PAYABLE, AND WHETHER
OR NOT AGENT SHALL HAVE COMMENCED ANY FORECLOSURE PROCEEDING OR OTHER ACTION FOR
THE ENFORCEMENT OF ITS RIGHTS AND REMEDIES UNDER ANY OF THE LOAN DOCUMENTS WITH
RESPECT TO ALL OR ANY PORTION OF THE COLLATERAL. ANY SUCH ACTIONS TAKEN BY AGENT
OR COLLATERAL AGENT SHALL BE CUMULATIVE AND CONCURRENT AND MAY BE PURSUED
INDEPENDENTLY, SINGLY, SUCCESSIVELY, TOGETHER OR OTHERWISE, AT SUCH TIME AND IN
SUCH ORDER AS AGENT MAY DETERMINE IN ITS SOLE DISCRETION, TO THE FULLEST EXTENT
PERMITTED BY LAW, WITHOUT IMPAIRING OR OTHERWISE AFFECTING THE OTHER RIGHTS AND
REMEDIES OF AGENT AND THE LENDERS PERMITTED BY LAW, EQUITY OR CONTRACT OR AS SET
FORTH HEREIN OR IN THE OTHER LOAN DOCUMENTS.

 

(B)           IN THE EVENT OF THE FORECLOSURE OR OTHER ACTION BY AGENT OR
COLLATERAL AGENT TO ENFORCE AGENT’S REMEDIES IN CONNECTION WITH ALL OR ANY
PORTION OF THE COLLATERAL, AGENT SHALL APPLY ALL NET PROCEEDS RECEIVED TO REPAY
THE INDEBTEDNESS IN ACCORDANCE WITH SECTION 3.8, THE INDEBTEDNESS SHALL BE
REDUCED TO THE EXTENT OF SUCH NET PROCEEDS AND THE REMAINING PORTION OF THE
INDEBTEDNESS SHALL REMAIN OUTSTANDING AND SECURED BY THE LOAN DOCUMENTS, IT
BEING UNDERSTOOD AND AGREED BY BORROWER THAT BORROWER IS LIABLE FOR THE
REPAYMENT OF ALL THE INDEBTEDNESS; PROVIDED, HOWEVER, THAT THE NOTE SHALL BE
DEEMED TO HAVE BEEN ACCELERATED ONLY TO THE EXTENT OF THE NET PROCEEDS ACTUALLY
RECEIVED BY AGENT WITH RESPECT TO THE COLLATERAL AND

 

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APPLIED IN REDUCTION OF THE INDEBTEDNESS EVIDENCED BY THE NOTE IN ACCORDANCE
WITH THE PROVISIONS OF THIS AGREEMENT, AFTER PAYMENT BY BORROWER OF ALL
TRANSACTION COSTS AND COSTS OF ENFORCEMENT.

 

(C)          UPON AND DURING THE CONTINUATION OF AN EVENT OF DEFAULT, THE AGENT
SHALL HAVE THE RIGHT, BUT NOT THE OBLIGATION, WITH RESPECT TO ANY AND ALL
BANKRUPTCY PROCEEDINGS THAT ARE NOW OR HEREAFTER COMMENCED IN CONNECTION WITH
THE PROPERTY, TO (I) VOTE TO ACCEPT OR REJECT ANY PLANS OF REORGANIZATION,
(II) VOTE IN ANY ELECTION OF A TRUSTEE, (III) ELECT THE TREATMENT OF SECURED
CLAIMS AS SPECIFIED IN SECTION 1111(B) OF THE BANKRUPTCY CODE, AND (IV) MAKE ANY
OTHER DECISIONS REQUESTED OF HOLDERS OF CLAIMS OR INTERESTS THAT THE BORROWER
WOULD HAVE HAD THE RIGHT TO DO IN SUCH BANKRUPTCY PROCEEDINGS IN THE ABSENCE OF
AN EVENT OF DEFAULT.

 

SECTION 7.3.            REMEDIES CUMULATIVE.  THE RIGHTS, POWERS AND REMEDIES OF
AGENT, COLLATERAL AGENT, OR ANY LENDER UNDER THIS AGREEMENT SHALL BE CUMULATIVE
AND NOT EXCLUSIVE OF ANY OTHER RIGHT, POWER OR REMEDY WHICH AGENT, COLLATERAL
AGENT OR ANY LENDER MAY HAVE AGAINST BORROWER PURSUANT TO THIS AGREEMENT OR THE
OTHER LOAN DOCUMENTS EXECUTED BY OR WITH RESPECT TO BORROWER, OR EXISTING AT LAW
OR IN EQUITY OR OTHERWISE. AGENT OR ANY LENDER’S RIGHTS, POWERS AND REMEDIES MAY
BE PURSUED SINGLY, CONCURRENTLY OR OTHERWISE, AT SUCH TIME AND IN SUCH ORDER AS
AGENT MAY DETERMINE IN AGENT’S SOLE DISCRETION. NO DELAY OR OMISSION TO EXERCISE
ANY REMEDY, RIGHT OR POWER ACCRUING UPON AN EVENT OF DEFAULT SHALL IMPAIR ANY
SUCH REMEDY, RIGHT OR POWER OR SHALL BE CONSTRUED AS A WAIVER THEREOF, BUT ANY
SUCH REMEDY, RIGHT OR POWER MAY BE EXERCISED FROM TIME TO TIME AND AS OFTEN AS
MAY BE DEEMED EXPEDIENT. A WAIVER OF ANY DEFAULT OR EVENT OF DEFAULT SHALL NOT
BE CONSTRUED TO BE A WAIVER OF ANY SUBSEQUENT DEFAULT OR EVENT OF DEFAULT OR TO
IMPAIR ANY REMEDY, RIGHT OR POWER CONSEQUENT THEREON. NOTWITHSTANDING ANY OTHER
PROVISION OF THIS AGREEMENT, AGENT FOR THE BENEFIT OF THE LENDERS RESERVES THE
RIGHT TO SEEK A DEFICIENCY JUDGMENT OR PRESERVE A DEFICIENCY CLAIM, IN
CONNECTION WITH THE FORECLOSURE OF THE MORTGAGE ON THE PROPERTY, TO THE EXTENT
NECESSARY TO FORECLOSE ON OTHER PARTS OF THE COLLATERAL.

 

SECTION 7.4.            CURATIVE ADVANCES.  IF ANY EVENT OF DEFAULT OCCURS AND
IS NOT CURED BY BORROWER AFTER NOTICE FROM THE AGENT, THEN AGENT OR COLLATERAL
AGENT MAY EXPEND SUCH SUMS AS EITHER SHALL REASONABLY DEEM APPROPRIATE TO CURE
OR ATTEMPT TO CURE SUCH EVENT OF DEFAULT. BORROWER SHALL IMMEDIATELY REPAY ALL
SUCH SUMS SO ADVANCED, WHICH SUMS SHALL IMMEDIATELY BECOME PART OF THE
INDEBTEDNESS, BEAR INTEREST AT THE DEFAULT RATE FROM THE DATE ADVANCED UNTIL THE
DATE REPAID, AND BE SECURED BY ALL COLLATERAL.

 

ARTICLE VIII.
MISCELLANEOUS

 

SECTION 8.1.            SURVIVAL.  THIS AGREEMENT AND ALL COVENANTS, AGREEMENTS,
REPRESENTATIONS AND WARRANTIES MADE HEREIN AND IN THE CERTIFICATES DELIVERED
PURSUANT HERETO SHALL SURVIVE THE EXECUTION AND DELIVERY OF THIS AGREEMENT, THE
MAKING BY THE INITIAL LENDER OF THE LOAN HEREUNDER AND THE EXECUTION AND
DELIVERY BY BORROWER TO THE INITIAL LENDER OF THE LOAN DOCUMENTS, AND SHALL
CONTINUE IN FULL FORCE AND EFFECT SO LONG AS ANY PORTION OF THE INDEBTEDNESS IS
OUTSTANDING AND UNPAID. WHENEVER IN THIS AGREEMENT ANY OF THE PARTIES HERETO IS
REFERRED TO, SUCH REFERENCE SHALL BE DEEMED TO INCLUDE THE SUCCESSORS AND
ASSIGNS OF SUCH PARTY. ALL COVENANTS, PROMISES AND AGREEMENTS IN THIS AGREEMENT
CONTAINED, BY OR ON BEHALF OF BORROWER, SHALL INURE TO THE BENEFIT OF THE
RESPECTIVE SUCCESSORS AND ASSIGNS OF AGENT AND EACH LENDER. NOTHING IN THIS
AGREEMENT OR IN ANY OTHER LOAN DOCUMENT, EXPRESS OR IMPLIED, SHALL GIVE TO ANY

 

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PERSON OTHER THAN THE PARTIES AND THE HOLDER OF THE NOTE AND THE OTHER LOAN
DOCUMENTS, AND THEIR LEGAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS, ANY BENEFIT
OR ANY LEGAL OR EQUITABLE RIGHT, REMEDY OR CLAIM HEREUNDER.

 

SECTION 8.2.            AGENT’S DISCRETION.  WHENEVER PURSUANT TO THIS
AGREEMENT, AGENT EXERCISES ANY RIGHT GIVEN TO IT TO APPROVE OR DISAPPROVE, OR
ANY ARRANGEMENT OR TERM IS TO BE SATISFACTORY TO AGENT, THE DECISION OF AGENT TO
APPROVE OR DISAPPROVE OR TO DECIDE WHETHER ARRANGEMENTS OR TERMS ARE
SATISFACTORY OR NOT SATISFACTORY SHALL (EXCEPT AS IS OTHERWISE SPECIFICALLY
HEREIN PROVIDED) BE IN THE SOLE DISCRETION OF AGENT AND SHALL BE FINAL AND
CONCLUSIVE.

 

SECTION 8.3.            GOVERNING LAW.

 

(A)           THIS AGREEMENT WAS NEGOTIATED IN NEW YORK AND MADE BY THE INITIAL
LENDER AND ACCEPTED BY BORROWER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF
THE NOTE DELIVERED PURSUANT HERETO WERE DISBURSED FROM NEW YORK, WHICH STATE THE
PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE
UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS (INCLUDING, WITHOUT
LIMITATION, MATTERS OF CONSTRUCTION, VALIDITY, PERFORMANCE, AND MAXIMUM
PERMISSIBLE RATES OF INTEREST), THIS AGREEMENT AND THE OBLIGATIONS ARISING
HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE
AND ANY APPLICABLE LAW OF THE UNITED STATES OF AMERICA.

 

(B)           ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST THE LENDERS OR
BORROWER ARISING OUT OF OR RELATING TO THIS AGREEMENT MAY BE INSTITUTED IN ANY
FEDERAL OR STATE COURT IN NEW YORK, NEW YORK. BORROWER HEREBY (I) IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION WHICH
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING
BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM, AND
(II) IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT,
ACTION OR PROCEEDING. BORROWER DOES HEREBY DESIGNATE AND APPOINT NATIONAL
REGISTERED AGENTS INC. AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS
BEHALF SERVICE OF ANY AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT,
ACTION OR PROCEEDING IN ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND
AGREES THAT SERVICE OF PROCESS UPON SAID AGENT AT SAID ADDRESS (OR AT SUCH OTHER
OFFICE IN NEW YORK, NEW YORK AS MAY BE DESIGNATED BY BORROWER FROM TIME TO TIME
IN ACCORDANCE WITH THE TERMS HEREOF) WITH A COPY TO BORROWER AT ITS PRINCIPAL
EXECUTIVE OFFICES, AND WRITTEN NOTICE OF SAID SERVICE OF BORROWER MAILED OR
DELIVERED TO BORROWER IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY
RESPECT EFFECTIVE SERVICE OF PROCESS UPON BORROWER, IN ANY SUCH SUIT, ACTION OR
PROCEEDING IN THE STATE OF NEW YORK. BORROWER (I) SHALL GIVE PROMPT NOTICE TO
AGENT OF ANY CHANGE IN ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (II) MAY AT
ANY TIME AND FROM TIME TO TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN
OFFICE IN NEW YORK, NEW YORK (WHICH OFFICE SHALL BE DESIGNATED AS THE ADDRESS
FOR SERVICE OF PROCESS), AND (III) SHALL PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF
ITS AUTHORIZED AGENT CEASES TO HAVE AN OFFICE IN NEW YORK, NEW YORK OR IS
DISSOLVED WITHOUT LEAVING A SUCCESSOR.

 

SECTION 8.4.            MODIFICATION, WAIVER IN WRITING.  NO MODIFICATION,
AMENDMENT, EXTENSION, DISCHARGE, TERMINATION OR WAIVER OF ANY PROVISION OF THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR CONSENT OR WAIVER REFERRED TO IN ANY
LOAN DOCUMENT OR CONSENT TO ANY DEPARTURE

 

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BY BORROWER THEREFROM, SHALL IN ANY EVENT BE EFFECTIVE UNLESS THE SAME SHALL BE
IN A WRITING SIGNED BY THE PARTY AGAINST WHOM ENFORCEMENT IS SOUGHT, AND THEN
SUCH WAIVER OR CONSENT SHALL BE EFFECTIVE ONLY IN THE SPECIFIC INSTANCE, AND FOR
THE PURPOSE, FOR WHICH GIVEN. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN, NO
NOTICE TO OR DEMAND ON BORROWER SHALL ENTITLE BORROWER TO ANY OTHER OR FUTURE
NOTICE OR DEMAND IN THE SAME, SIMILAR OR OTHER CIRCUMSTANCES.

 

SECTION 8.5.            DELAY NOT A WAIVER.  NEITHER ANY FAILURE NOR ANY DELAY
ON THE PART OF AGENT OR ANY LENDER IN INSISTING UPON STRICT PERFORMANCE OF ANY
TERM, CONDITION, COVENANT OR AGREEMENT, OR EXERCISING ANY RIGHT, POWER, REMEDY
OR PRIVILEGE HEREUNDER, OR UNDER ANY OTHER LOAN DOCUMENT, OR ANY OTHER
INSTRUMENT GIVEN AS SECURITY THEREFOR, SHALL OPERATE AS OR CONSTITUTE A WAIVER
THEREOF, NOR SHALL A SINGLE OR PARTIAL EXERCISE THEREOF PRECLUDE ANY OTHER
FUTURE EXERCISE, OR THE EXERCISE OF ANY OTHER RIGHT, POWER, REMEDY OR PRIVILEGE.
IN PARTICULAR, AND NOT BY WAY OF LIMITATION, BY ACCEPTING PAYMENT AFTER THE DUE
DATE OF ANY AMOUNT PAYABLE UNDER THIS AGREEMENT, THE NOTE OR ANY OTHER LOAN
DOCUMENT, AGENT AND EACH LENDER SHALL NOT BE DEEMED TO HAVE WAIVED ANY RIGHT
EITHER TO REQUIRE PROMPT PAYMENT WHEN DUE OF ALL OTHER AMOUNTS DUE UNDER THIS
AGREEMENT, THE NOTE OR THE OTHER LOAN DOCUMENTS, OR TO DECLARE A DEFAULT FOR
FAILURE TO EFFECT PROMPT PAYMENT OF ANY SUCH OTHER AMOUNT.

 

SECTION 8.6.            NOTICES.  ALL NOTICES, CONSENTS, APPROVALS AND REQUESTS
REQUIRED OR PERMITTED HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT SHALL BE GIVEN
IN WRITING AND SHALL BE EFFECTIVE FOR ALL PURPOSES IF HAND DELIVERED OR SENT BY
(A) CERTIFIED OR REGISTERED UNITED STATES MAIL, POSTAGE PREPAID, OR
(B) EXPEDITED PREPAID DELIVERY SERVICE, EITHER COMMERCIAL OR UNITED STATES
POSTAL SERVICE, WITH PROOF OF ATTEMPTED DELIVERY, AND BY FACSIMILE TRANSMISSION,
ADDRESSED IF TO LENDER AT ITS ADDRESS SET FORTH ON THE FIRST PAGE HEREOF,
ATTENTION:  CHRIS TOGNOLA/TOM TRAYNOR, IF TO COLLATERAL AGENT AT ITS ADDRESS SET
FORTH ON THE FIRST PAGE HEREOF, ATTENTION:  RACHEL KAHSEN, AND IF TO BORROWER AT
ITS ADDRESSES SET FORTH ON THE FIRST PAGE HEREOF, ATTENTION:  PRESIDENT AND
OFFICE OF THE GENERAL COUNSEL, WITH A COPY TO CLIFFORD CHANCE US LLP, 31 WEST
52ND STREET, NEW YORK, NEW YORK 10019, ATTN: TONY LOPEZ, ESQ., OR AT SUCH OTHER
ADDRESS AND PERSON AS SHALL BE DESIGNATED FROM TIME TO TIME BY ANY PARTY HERETO,
AS THE CASE MAY BE, IN A WRITTEN NOTICE TO THE OTHER PARTIES HERETO IN THE
MANNER PROVIDED FOR IN THIS SECTION 8.6. A NOTICE SHALL BE DEEMED TO HAVE BEEN
GIVEN:  IN THE CASE OF HAND DELIVERY, AT THE TIME OF DELIVERY; IN THE CASE OF
REGISTERED OR CERTIFIED MAIL, WHEN DELIVERED OR THREE BUSINESS DAYS AFTER
MAILING; OR IN THE CASE OF EXPEDITED PREPAID DELIVERY AND FACSIMILE
TRANSMISSION, ON THE BUSINESS DAY AFTER THE SAME WAS SENT. A PARTY RECEIVING A
NOTICE WHICH DOES NOT COMPLY WITH THE TECHNICAL REQUIREMENTS FOR NOTICE UNDER
THIS SECTION 8.6 MAY ELECT TO WAIVE ANY DEFICIENCIES AND TREAT THE NOTICE AS
HAVING BEEN PROPERLY GIVEN.

 

SECTION 8.7.            TRIAL BY JURY.  BORROWER, TO THE FULLEST EXTENT THAT IT
MAY LAWFULLY DO SO, WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING, INCLUDING,
WITHOUT LIMITATION, ANY TORT ACTION, BROUGHT BY ANY PARTY HERETO WITH RESPECT TO
THIS AGREEMENT, THE NOTE OR THE OTHER LOAN DOCUMENTS.

 

SECTION 8.8.            HEADINGS.  THE ARTICLE AND SECTION HEADINGS IN THIS
AGREEMENT ARE INCLUDED HEREIN FOR CONVENIENCE OF REFERENCE ONLY AND SHALL NOT
CONSTITUTE A PART OF THIS AGREEMENT FOR ANY OTHER PURPOSE.

 

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Section 8.9.            Assignment.

 

(A)           BORROWER MAY NOT SELL, ASSIGN OR TRANSFER ANY INTEREST IN THE LOAN
DOCUMENTS, OR ANY PORTION OF THE FOREGOING (INCLUDING, WITHOUT LIMITATION,
BORROWER’S RIGHTS, TITLE, INTERESTS, REMEDIES, POWERS AND DUTIES HEREUNDER AND
THEREUNDER) WITHOUT AGENT’S PRIOR WRITTEN CONSENT.  EACH LENDER SHALL HAVE THE
RIGHT TO ASSIGN OR PARTICIPATE THIS AGREEMENT AND/OR ITS INTEREST IN ANY OF THE
OTHER LOAN DOCUMENTS AND THE OBLIGATIONS HEREUNDER TO ANY PERSON. IN THE EVENT
OF AN ASSIGNMENT BY ANY LENDER, (A) THE ASSIGNEE SHALL HAVE, TO THE EXTENT OF
SUCH ASSIGNMENT, THE SAME RIGHTS, BENEFITS AND OBLIGATIONS AS IT WOULD HAVE IF
IT WERE AN ORIGINAL “LENDER” HEREUNDER; (B) THE ASSIGNEE SHALL BE DEEMED FOR ALL
PURPOSES TO BE A “LENDER” HEREUNDER; AND (C) UPON ANY SUCH SUBSTITUTION OF
LENDER, A REPLACEMENT OR ADDITION “LENDER SIGNATURE PAGE” SHALL BE EXECUTED BY
THE NEW LENDER AND ATTACHED TO THIS AGREEMENT AND THEREUPON BECOME A PART OF
THIS AGREEMENT. AFTER THE EFFECTIVENESS OF ANY ASSIGNMENT, THE NEW LENDER SHALL
PROVIDE NOTICE TO BORROWER OF THE IDENTITY, ADDRESS AND OTHER PERTINENT
INFORMATION PERTAINING TO THE NEW LENDER. NOTWITHSTANDING ANYTHING IN THIS
AGREEMENT TO THE CONTRARY, AFTER AN ASSIGNMENT BY ANY LENDER, THE “LENDER”
(PRIOR TO SUCH ASSIGNMENT) SHALL CONTINUE TO HAVE THE BENEFITS OF ANY RIGHTS OR
INDEMNIFICATIONS AND SHALL CONTINUE TO HAVE THE OBLIGATIONS CONTAINED HEREIN
WHICH SUCH LENDER HAD DURING THE PERIOD SUCH PARTY WAS A “LENDER” HEREUNDER.
BORROWER SHALL NOT BE OBLIGATED TO INTERACT DIRECTLY WITH ANY PARTICIPANT IN THE
LOAN OR TO PAY OR REIMBURSE THE AGENT OR ANY LENDER FOR ANY TRANSACTION COSTS
THAT WOULD NOT HAVE BEEN INCURRED BY THE AGENT OR SUCH LENDER HAD NO SUCH
PARTICIPATION IN THE LOAN BEEN ISSUED.

 

(B)           THE AGENT MAY FROM TIME TO TIME ELECT TO ENTER INTO A SERVICING
AGREEMENT WITH A SERVICER, PURSUANT TO WHICH THE SERVICER SHALL BE APPOINTED TO
SERVICE AND ADMINISTER THE LOAN AND THE ACCOUNT COLLATERAL IN ACCORDANCE WITH
THE TERMS HEREOF AND TO EXERCISE ANY AND ALL OTHER RIGHTS OF THE LENDERS WITH
RESPECT TO THE LOAN AS SET FORTH IN SUCH SERVICING AGREEMENT. THE AGENT SHALL
PROMPTLY NOTIFY THE BORROWER IF THE AGENT SHALL ELECT TO APPOINT OR CHANGE THE
SERVICER, AND ALL NOTICES AND OTHER COMMUNICATIONS FROM THE BORROWER TO THE
AGENT SHALL BE DELIVERED TO THE SERVICER WITH A COPY CONCURRENTLY DELIVERED TO
THE AGENT, AND ANY NOTICE, DIRECTION OR OTHER COMMUNICATION FROM THE SERVICER TO
THE BORROWER SHALL HAVE THE SAME FORCE AND EFFECT AS A NOTICE, DIRECTION OR
COMMUNICATION FROM THE AGENT. THE SERVICER SHALL BE ENTITLED TO BE REIMBURSED
FOR ANY COST, EXPENSE OR LIABILITY WHICH IS INCURRED BY THE SERVICER PURSUANT TO
SUCH SERVICING AND ADMINISTRATIVE DUTIES AND WHICH WOULD OTHERWISE BE
REIMBURSABLE TO THE LENDERS UNDER THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN
THE SAME MANNER AND TO THE SAME EXTENT AS IF THE LENDERS INCURRED SUCH COST,
EXPENSE OR LIABILITY IN THE FIRST PLACE. THE PARTIES HERETO ACKNOWLEDGE AND
AGREE THAT THE SERVICER SHALL BE A THIRD PARTY BENEFICIARY TO THIS AGREEMENT AND
THE OTHER LOAN DOCUMENTS.

 

SECTION 8.10.          SEVERABILITY.  WHEREVER POSSIBLE, EACH PROVISION OF THIS
AGREEMENT SHALL BE INTERPRETED IN SUCH MANNER AS TO BE EFFECTIVE AND VALID UNDER
APPLICABLE LAW, BUT IF ANY PROVISION OF THIS AGREEMENT SHALL BE PROHIBITED BY OR
INVALID UNDER APPLICABLE LAW, SUCH PROVISION SHALL BE INEFFECTIVE TO THE EXTENT
OF SUCH PROHIBITION OR INVALIDITY, WITHOUT INVALIDATING THE REMAINDER OF SUCH
PROVISION OR THE REMAINING PROVISIONS OF THIS AGREEMENT.

 

SECTION 8.11.          PREFERENCES.  AGENT AND THE LENDERS SHALL HAVE NO
OBLIGATION TO MARSHAL ANY ASSETS IN FAVOR OF BORROWER OR ANY OTHER PARTY OR
AGAINST OR IN PAYMENT OF ANY OR ALL OF THE OBLIGATIONS OF BORROWER PURSUANT TO
THIS AGREEMENT, THE NOTE OR ANY OTHER LOAN

 

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DOCUMENT. THE LENDERS SHALL HAVE THE CONTINUING AND EXCLUSIVE RIGHT TO APPLY OR
REVERSE AND REAPPLY ANY AND ALL PAYMENTS BY BORROWER TO ANY PORTION OF THE
OBLIGATIONS OF BORROWER HEREUNDER, PROVIDED THAT SUCH APPLICATION OR
REAPPLICATION IS PERFORMED BY THE LENDERS IN ACCORDANCE WITH THE TERMS OF THIS
AGREEMENT OR ANY OTHER APPLICABLE LOAN DOCUMENT. TO THE EXTENT BORROWER MAKES A
PAYMENT OR PAYMENTS TO AGENT OR ANY LENDER FOR BORROWER’S BENEFIT, WHICH PAYMENT
OR PROCEEDS OR ANY PART THEREOF ARE SUBSEQUENTLY INVALIDATED, DECLARED TO BE
FRAUDULENT OR PREFERENTIAL, SET ASIDE OR REQUIRED TO BE REPAID TO A TRUSTEE,
RECEIVER OR ANY OTHER PARTY UNDER ANY BANKRUPTCY LAW, STATE OR FEDERAL LAW,
COMMON LAW OR EQUITABLE CAUSE, THEN, TO THE EXTENT OF SUCH PAYMENT OR PROCEEDS
RECEIVED, THE OBLIGATIONS HEREUNDER OR PART THEREOF INTENDED TO BE SATISFIED
SHALL BE REVIVED AND CONTINUE IN FULL FORCE AND EFFECT, AS IF SUCH PAYMENT OR
PROCEEDS HAD NOT BEEN RECEIVED BY AGENT OR SUCH LENDER.

 

SECTION 8.12.          WAIVER OF NOTICE.  BORROWER SHALL NOT BE ENTITLED TO ANY
NOTICES OF ANY NATURE WHATSOEVER FROM AGENT, ANY LENDER OR COLLATERAL AGENT
EXCEPT WITH RESPECT TO MATTERS FOR WHICH THIS AGREEMENT OR ANOTHER LOAN DOCUMENT
SPECIFICALLY AND EXPRESSLY PROVIDES FOR THE GIVING OF NOTICE BY AGENT, SUCH
LENDER AND/OR COLLATERAL AGENT TO BORROWER AND EXCEPT WITH RESPECT TO MATTERS
FOR WHICH BORROWER IS NOT, PURSUANT TO APPLICABLE LEGAL REQUIREMENTS, PERMITTED
TO WAIVE THE GIVING OF NOTICE. BORROWER HEREBY EXPRESSLY WAIVES THE RIGHT TO
RECEIVE ANY NOTICE FROM AGENT, ANY LENDER AND COLLATERAL AGENT WITH RESPECT TO
ANY MATTER FOR WHICH THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS DOES NOT
SPECIFICALLY AND EXPRESSLY PROVIDE FOR THE GIVING OF NOTICE BY AGENT OR SUCH
LENDER OR COLLATERAL AGENT TO BORROWER.

 

SECTION 8.13.          FAILURE TO CONSENT.  IF BORROWER SHALL SEEK THE APPROVAL
BY OR CONSENT OF AGENT OR THE LENDERS HEREUNDER OR UNDER THE NOTE, OR ANY OF THE
OTHER LOAN DOCUMENTS, AND AGENT OR THE LENDERS SHALL FAIL OR REFUSE TO GIVE SUCH
CONSENT OR APPROVAL, THEN BORROWER SHALL NOT BE ENTITLED TO ANY DAMAGES FOR ANY
WITHHOLDING OR DELAY OF SUCH APPROVAL OR CONSENT BY AGENT OR THE LENDERS, IT
BEING INTENDED THAT BORROWER’S SOLE REMEDY SHALL BE TO BRING AN ACTION FOR AN
INJUNCTION OR SPECIFIC PERFORMANCE.

 

SECTION 8.14.          SCHEDULES INCORPORATED.  THE INFORMATION SET FORTH ON THE
COVER, HEADING AND RECITALS HEREOF, AND THE SCHEDULES ATTACHED HERETO, ARE
HEREBY INCORPORATED HEREIN AS A PART OF THIS AGREEMENT WITH THE SAME EFFECT AS
IF SET FORTH IN THE BODY HEREOF.

 

SECTION 8.15.          OFFSETS, COUNTERCLAIMS AND DEFENSES.  ANY ASSIGNEE OF ANY
LENDER’S INTEREST IN AND TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL
TAKE THE SAME FREE AND CLEAR OF ALL OFFSETS, COUNTERCLAIMS OR DEFENSES WHICH ARE
UNRELATED TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS WHICH BORROWER MAY
OTHERWISE HAVE AGAINST ANY ASSIGNOR OR THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS. NO SUCH UNRELATED COUNTERCLAIM OR DEFENSE SHALL BE INTERPOSED OR
ASSERTED BY BORROWER IN ANY ACTION OR PROCEEDING BROUGHT BY ANY SUCH ASSIGNEE
UPON THIS AGREEMENT OR UPON ANY OTHER LOAN DOCUMENT. ANY SUCH RIGHT TO INTERPOSE
OR ASSERT ANY SUCH UNRELATED OFFSET, COUNTERCLAIM OR DEFENSE IN ANY SUCH ACTION
OR PROCEEDING IS HEREBY EXPRESSLY WAIVED BY BORROWER.

 

SECTION 8.16.          NO JOINT VENTURE OR PARTNERSHIP.  BORROWER, AGENT AND
EACH LENDER INTEND THAT THE RELATIONSHIP CREATED HEREUNDER BE SOLELY THAT OF
BORROWER AND LENDER. NOTHING HEREIN IS INTENDED TO CREATE A JOINT VENTURE,
PARTNERSHIP, TENANCY-IN-COMMON, OR JOINT

 

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TENANCY RELATIONSHIP BETWEEN BORROWER AND ANY LENDER NOR TO GRANT ANY LENDER ANY
INTEREST IN THE COLLATERAL OTHER THAN THAT OF SECURED PARTY, MORTGAGEE OR
LENDER.

 

SECTION 8.17.          WAIVER OF MARSHALLING OF ASSETS DEFENSE.  TO THE FULLEST
EXTENT BORROWER MAY LEGALLY DO SO, BORROWER WAIVES ALL RIGHTS TO A MARSHALLING
OF THE ASSETS OF BORROWER, AND OTHERS WITH INTERESTS IN BORROWER, AND OF THE
COLLATERAL, OR TO A SALE IN INVERSE ORDER OF ALIENATION IN THE EVENT OF
FORECLOSURE OF THE INTERESTS HEREBY CREATED, AND AGREES NOT TO ASSERT ANY RIGHT
UNDER ANY LAWS PERTAINING TO THE MARSHALLING OF ASSETS, THE SALE IN INVERSE
ORDER OF ALIENATION, HOMESTEAD EXEMPTION, THE ADMINISTRATION OF ESTATES OF
DECEDENTS, OR ANY OTHER MATTERS WHATSOEVER TO DEFEAT, REDUCE OR AFFECT THE RIGHT
OF ANY LENDER UNDER THE LOAN DOCUMENTS TO A SALE OF ANY COLLATERAL FOR THE
COLLECTION OF THE INDEBTEDNESS WITHOUT ANY PRIOR OR DIFFERENT RESORT FOR
COLLECTION, OR THE RIGHT OF ANY LENDER TO THE PAYMENT OF THE INDEBTEDNESS OUT OF
THE NET PROCEEDS OF THE COLLATERAL IN PREFERENCE TO EVERY OTHER CLAIMANT
WHATSOEVER.

 

SECTION 8.18.          WAIVER OF COUNTERCLAIM.  TO THE EXTENT PERMITTED BY
APPLICABLE LAW, BORROWER HEREBY WAIVES THE RIGHT TO ASSERT A COUNTERCLAIM, OTHER
THAN COMPULSORY COUNTERCLAIM, IN ANY ACTION OR PROCEEDING BROUGHT AGAINST IT BY
AGENT OR ITS AGENTS.

 

SECTION 8.19.          CONFLICT; CONSTRUCTION OF DOCUMENTS.  IN THE EVENT OF ANY
CONFLICT BETWEEN THE PROVISIONS OF THIS AGREEMENT AND THE PROVISIONS OF ANY OF
THE OTHER LOAN DOCUMENTS, THE PROVISIONS OF THIS AGREEMENT SHALL PREVAIL. THE
PARTIES HERETO ACKNOWLEDGE THAT THEY WERE REPRESENTED BY COUNSEL IN CONNECTION
WITH THE NEGOTIATION AND DRAFTING OF THE LOAN DOCUMENTS AND THAT THE LOAN
DOCUMENTS SHALL NOT BE SUBJECT TO THE PRINCIPLE OF CONSTRUING THEIR MEANING
AGAINST THE PARTY THAT DRAFTED SAME.

 

SECTION 8.20.          BROKERS AND FINANCIAL ADVISORS.  BORROWER AND THE INITIAL
LENDER HEREBY REPRESENT THAT THEY HAVE DEALT WITH NO FINANCIAL ADVISORS,
BROKERS, UNDERWRITERS, PLACEMENT AGENTS, AGENTS OR FINDERS IN CONNECTION WITH
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. BORROWER AND INITIAL LENDER
HEREBY AGREE TO INDEMNIFY AND HOLD THE OTHER AND COLLATERAL AGENT HARMLESS FROM
AND AGAINST ANY AND ALL CLAIMS, LIABILITIES, COSTS AND EXPENSES OF ANY KIND IN
ANY WAY RELATING TO OR ARISING FROM A CLAIM BY ANY PERSON THAT SUCH PERSON ACTED
ON BEHALF OF THE INDEMNIFYING PARTY IN CONNECTION WITH THE TRANSACTIONS
CONTEMPLATED HEREIN. THE PROVISIONS OF THIS SECTION 8.20 SHALL SURVIVE THE
EXPIRATION AND TERMINATION OF THIS AGREEMENT AND THE REPAYMENT OF THE
INDEBTEDNESS.

 

SECTION 8.21.          COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED IN ANY
NUMBER OF COUNTERPARTS, EACH OF WHICH WHEN SO EXECUTED AND DELIVERED SHALL BE AN
ORIGINAL, BUT ALL OF WHICH SHALL TOGETHER CONSTITUTE ONE AND THE SAME
INSTRUMENT.

 

SECTION 8.22.          ESTOPPEL CERTIFICATES.  AGENT, BORROWER AND EACH LENDER
HEREBY AGREE AT ANY TIME AND FROM TIME TO TIME UPON NOT LESS THAN FIFTEEN (15)
DAYS PRIOR WRITTEN NOTICE BY BORROWER OR SUCH LENDER TO EXECUTE, ACKNOWLEDGE AND
DELIVER TO THE PARTY SPECIFIED IN SUCH NOTICE, A STATEMENT, IN WRITING,
CERTIFYING THAT THIS AGREEMENT IS UNMODIFIED AND IN FULL FORCE AND EFFECT (OR IF
THERE HAVE BEEN MODIFICATIONS, THAT THE SAME, AS MODIFIED, IS IN FULL FORCE AND
EFFECT AND STATING THE MODIFICATIONS HERETO), AND STATING WHETHER OR NOT, TO THE
KNOWLEDGE OF SUCH CERTIFYING PARTY, ANY DEFAULT OR EVENT OF DEFAULT HAS OCCURRED
AND IS THEN CONTINUING, AND, IF SO, SPECIFYING EACH SUCH DEFAULT OR EVENT OF
DEFAULT; PROVIDED, HOWEVER, THAT IT SHALL BE A CONDITION

 

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PRECEDENT TO ANY LENDER’S OBLIGATION TO DELIVER THE STATEMENT PURSUANT TO THIS
SECTION 8.22, THAT SUCH LENDER SHALL HAVE RECEIVED, TOGETHER WITH BORROWER’S
REQUEST FOR SUCH STATEMENT, AN OFFICER’S CERTIFICATE STATING THAT, TO THE
KNOWLEDGE OF BORROWER, NO DEFAULT OR EVENT OF DEFAULT EXISTS AS OF THE DATE OF
SUCH CERTIFICATE (OR SPECIFYING SUCH DEFAULT OR EVENT OF DEFAULT).

 

SECTION 8.23.          PAYMENT OF EXPENSES.  BORROWER SHALL PAY ALL TRANSACTION
COSTS, WHICH SHALL INCLUDE, WITHOUT LIMITATION, (A) REASONABLE OUT-OF-POCKET
COSTS AND EXPENSES OF AGENT IN CONNECTION WITH (I) THE NEGOTIATION, PREPARATION,
EXECUTION AND DELIVERY OF THE LOAN DOCUMENTS AND THE DOCUMENTS AND INSTRUMENTS
REFERRED TO THEREIN; (II) THE CREATION, PERFECTION OR PROTECTION OF LENDERS’
LIENS IN THE COLLATERAL (INCLUDING, WITHOUT LIMITATION, FEES AND EXPENSES FOR
TITLE AND LIEN SEARCHES OR AMENDED OR REPLACEMENT MORTGAGES, UCC FINANCING
STATEMENTS OR COLLATERAL SECURITY INSTRUMENTS, TITLE INSURANCE PREMIUMS AND
FILING AND RECORDING FEES, THIRD PARTY DUE DILIGENCE EXPENSES FOR THE PROPERTY
PLUS TRAVEL EXPENSES, ACCOUNTING FIRM FEES, COSTS OF THE APPRAISALS,
ENVIRONMENTAL REPORTS (AND AN ENVIRONMENTAL CONSULTANT), AND THE ENGINEERING
REPORTS AND COSTS AND FEES INCURRED IN CONNECTION WITH ARRANGING, SETTING UP,
SERVICING AND MAINTAINING THE ACCOUNT COLLATERAL); (III) THE NEGOTIATION,
PREPARATION, EXECUTION AND DELIVERY OF ANY AMENDMENT, WAIVER, RESTRUCTURING OR
CONSENT RELATING TO ANY OF THE LOAN DOCUMENTS, AND (IV) THE PRESERVATION OF
RIGHTS UNDER AND ENFORCEMENT OF THE LOAN DOCUMENTS AND THE DOCUMENTS AND
INSTRUMENTS REFERRED TO THEREIN, INCLUDING ANY COMMUNICATIONS OR DISCUSSIONS
RELATING TO ANY ACTION THAT BORROWER SHALL FROM TIME TO TIME REQUEST AGENT TO
TAKE, AS WELL AS ANY RESTRUCTURING OR RESCHEDULING OF THE INDEBTEDNESS, (B) THE
REASONABLE FEES, EXPENSES AND OTHER CHARGES OF COUNSEL TO AGENT IN CONNECTION
WITH ALL OF THE FOREGOING, (C) ALL REASONABLE FEES AND EXPENSES OF EACH OF THE
SERVICER APPOINTED PURSUANT TO SECTION 8.9(B) AND COLLATERAL AGENT AND ITS
RESPECTIVE COUNSEL AND (D) AGENT’S (OR, WHERE REASONABLY DEEMED NECESSARY BY
AGENT, ANY OTHER LENDER’S) REASONABLE OUT-OF-POCKET TRAVEL EXPENSES IN
CONNECTION WITH SITE VISITS TO THE PROPERTY.

 

SECTION 8.24.          NON-RECOURSE.  ANYTHING CONTAINED HEREIN, IN THE NOTE OR
IN ANY OTHER LOAN DOCUMENT TO THE CONTRARY NOTWITHSTANDING, NO RECOURSE SHALL BE
HAD FOR THE PAYMENT OF THE PRINCIPAL OR INTEREST ON THE LOAN OR FOR ANY OTHER
INDEBTEDNESS, OBLIGATION OR LIABILITY HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT
OR FOR ANY CLAIM BASED HEREON OR THEREON OR OTHERWISE IN RESPECT HEREOF OR
THEREOF AGAINST (I) ANY AGENT, CONTRACTOR, DIRECTOR, OFFICER, MEMBER,
CONSULTANT, MANAGER, STOCKHOLDER, SUBSCRIBER TO CAPITAL STOCK, INCORPORATOR,
BENEFICIARY, PARTICIPANT, TRUSTEE OR ADVISOR OF BORROWER, OR ANY PARTNER OR
MEMBER THEREIN; (II) ANY LEGAL REPRESENTATIVE, HEIR, ESTATE, SUCCESSOR OR ASSIGN
OF ANY THEREOF; (III) ANY CORPORATION (OR ANY OFFICER, DIRECTOR, EMPLOYEE OR
SHAREHOLDER THEREOF), LIMITED LIABILITY COMPANY (OR MEMBER THEREOF), PARTNERSHIP
(OR ANY PARTNER THEREOF), INDIVIDUAL OR ENTITY TO WHICH ANY OWNERSHIP INTEREST
IN BORROWER SHALL HAVE BEEN DIRECTLY OR INDIRECTLY TRANSFERRED; (IV) ANY
PURCHASER OF ANY ASSET OF BORROWER; OR (V) ANY OTHER PERSON (EXCEPT BORROWER AND
GUARANTOR), FOR ANY DEFICIENCY OR OTHER SUM OWING WITH RESPECT TO THE NOTE OR
ANY OTHER INDEBTEDNESS, OBLIGATION OR LIABILITY OR ARISING UNDER THIS AGREEMENT
OR ANY LOAN DOCUMENT. IT IS UNDERSTOOD THAT NEITHER THE NOTE NOR ANY OTHER
INDEBTEDNESS, OBLIGATION OR LIABILITY UNDER OR WITH RESPECT TO THIS AGREEMENT
AND ANY OTHER LOAN DOCUMENT MAY BE ENFORCED AGAINST ANY PERSON DESCRIBED IN
CLAUSES (I) THROUGH (V) ABOVE; PROVIDED, HOWEVER, THAT THE FOREGOING PROVISIONS
OF THIS PARAGRAPH SHALL NOT:

 

(A)          PREVENT RECOURSE TO BORROWER AND GUARANTOR, THE ASSETS OF BORROWER
AND GUARANTOR, THE PROPERTY OR ANY OTHER INSTRUMENT OR DOCUMENT WHICH

 

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IS PLEDGED BY BORROWER TO THE LENDERS PURSUANT TO THE LOAN DOCUMENTS, INCLUDING
ALL COLLATERAL;

 

(B)           HAVE ANY APPLICABILITY WHATSOEVER TO THE COLLATERAL PLEDGED
PURSUANT TO THE PLEDGE AGREEMENT OR LIMIT THE LIABILITY OF THE PARTIES UNDER THE
GUARANTY OR THE LIABILITY OF THE PARTIES THEREUNDER; OR

 

(C)           CONSTITUTE A WAIVER, RELEASE OR DISCHARGE OF ANY INDEBTEDNESS OR
OBLIGATION EVIDENCED BY THE NOTE OR SECURED BY THE LOAN DOCUMENTS, AND THE SAME
SHALL CONTINUE UNTIL PAID OR DISCHARGED IN FULL.

 

ARTICLE IX.
THE AGENT

 

SECTION 9.1.            APPOINTMENT, POWERS AND IMMUNITIES.  EACH LENDER HEREBY
IRREVOCABLY APPOINTS AND AUTHORIZES AGENT TO ACT AS ITS AGENT HEREUNDER AND
UNDER THE OTHER LOAN DOCUMENTS WITH SUCH POWERS AS ARE SPECIFICALLY DELEGATED TO
AGENT BY THE TERMS OF THIS AGREEMENT AND OF THE OTHER LOAN DOCUMENTS, TOGETHER
WITH SUCH OTHER POWERS AS ARE REASONABLY INCIDENTAL THERETO. AGENT (WHICH TERM
AS USED IN THIS SENTENCE AND IN SECTION 9.5 AND THE FIRST SENTENCE OF
SECTION 9.6 HEREOF SHALL INCLUDE REFERENCE TO ITS AFFILIATES AND ITS OWN AND ITS
AFFILIATES’ OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS):  (A) SHALL HAVE NO
DUTIES OR RESPONSIBILITIES TO THE LENDERS EXCEPT THOSE EXPRESSLY SET FORTH IN
THIS AGREEMENT AND IN THE OTHER LOAN DOCUMENTS, AND SHALL NOT BY REASON OF THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT BE A TRUSTEE FOR ANY LENDER; (B) SHALL NOT
BE RESPONSIBLE TO THE LENDERS FOR ANY RECITALS, STATEMENTS, REPRESENTATIONS OR
WARRANTIES CONTAINED IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT, OR IN ANY
CERTIFICATE OR OTHER DOCUMENT REFERRED TO OR PROVIDED FOR IN, OR RECEIVED BY ANY
OF THEM UNDER, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR THE VALUE,
VALIDITY, EFFECTIVENESS, GENUINENESS, ENFORCEABILITY OR SUFFICIENCY OF THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT OR ANY OTHER DOCUMENT REFERRED TO OR
PROVIDED FOR HEREIN OR THEREIN OR FOR ANY FAILURE BY BORROWER, OR ANY OTHER
PERSON TO PERFORM ANY OF THEIR OBLIGATIONS HEREUNDER OR THEREUNDER; (C) SHALL
NOT BE REQUIRED TO INITIATE OR CONDUCT ANY LITIGATION OR COLLECTION PROCEEDINGS
HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT; AND (D) SHALL NOT BE RESPONSIBLE TO
THE LENDERS FOR ANY ACTION TAKEN OR OMITTED TO BE TAKEN BY IT HEREUNDER OR UNDER
ANY OTHER LOAN DOCUMENT OR UNDER ANY OTHER DOCUMENT OR INSTRUMENT REFERRED TO OR
PROVIDED FOR HEREIN OR THEREIN OR IN CONNECTION HEREWITH OR THEREWITH, EXCEPT
FOR ITS OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. AGENT MAY EMPLOY AGENTS AND
ATTORNEYS-IN-FACT AND SHALL NOT BE RESPONSIBLE TO THE LENDERS FOR THE NEGLIGENCE
OR MISCONDUCT OF ANY SUCH AGENTS OR ATTORNEYS-IN-FACT SELECTED BY IT IN GOOD
FAITH.

 

SECTION 9.2.            RELIANCE BY AGENT.  AGENT SHALL BE ENTITLED TO RELY UPON
ANY CERTIFICATION, NOTICE OR OTHER COMMUNICATION (INCLUDING, WITHOUT LIMITATION,
ANY THEREOF BY TELEPHONE, FACSIMILE TRANSMISSION, TELEX, ELECTRONIC MAIL, OR
CABLE) BELIEVED BY IT TO BE GENUINE AND CORRECT AND TO HAVE BEEN SIGNED OR SENT
BY OR ON BEHALF OF THE PROPER PERSON OR PERSONS, AND UPON ADVICE AND STATEMENTS
OF LEGAL COUNSEL, INDEPENDENT ACCOUNTANTS AND OTHER EXPERTS SELECTED BY AGENT IN
GOOD FAITH. AS TO ANY MATTERS NOT EXPRESSLY PROVIDED FOR BY THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT, AGENT SHALL IN ALL CASES BE FULLY PROTECTED IN ACTING,
OR IN REFRAINING FROM ACTING, HEREUNDER OR THEREUNDER IN ACCORDANCE WITH THE
INSTRUCTIONS GIVEN BY ALL OF THE LENDERS,

 

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AND SUCH INSTRUCTIONS OF SUCH LENDERS AND ANY ACTION TAKEN OR FAILURE TO ACT
PURSUANT THERETO SHALL BE BINDING ON ALL OF THE LENDERS.

 

SECTION 9.3.            DEFAULTS.  AGENT SHALL NOT BE DEEMED TO HAVE KNOWLEDGE
OR NOTICE OF THE OCCURRENCE OF A DEFAULT OR EVENT OF DEFAULT UNLESS AGENT HAS
RECEIVED WRITTEN NOTICE FROM A LENDER OR BORROWER SPECIFYING SUCH DEFAULT AND
STATING THAT SUCH NOTICE IS A “NOTICE OF DEFAULT”. IN THE EVENT THAT AGENT
RECEIVES SUCH A NOTICE OF THE OCCURRENCE OF A DEFAULT OR EVENT OF DEFAULT, AGENT
SHALL GIVE PROMPT NOTICE THEREOF TO THE LENDERS. AGENT SHALL (SUBJECT TO
SECTION 9.7 HEREOF) TAKE SUCH ACTION WITH RESPECT TO SUCH DEFAULT OR EVENT OF
DEFAULT AS SHALL BE DIRECTED BY ALL LENDERS, PROVIDED THAT, UNLESS AND UNTIL
AGENT SHALL HAVE RECEIVED SUCH DIRECTIONS, AGENT MAY (BUT SHALL NOT BE OBLIGATED
TO) TAKE SUCH ACTION, OR REFRAIN FROM TAKING SUCH ACTION, WITH RESPECT TO SUCH
DEFAULT OR EVENT OF DEFAULT AS IT SHALL DEEM ADVISABLE IN THE BEST INTEREST OF
THE LENDERS EXCEPT TO THE EXTENT THAT THIS AGREEMENT EXPRESSLY REQUIRES THAT
SUCH ACTION BE TAKEN, OR NOT BE TAKEN, ONLY WITH THE CONSENT OR UPON THE
AUTHORIZATION OF ALL OF THE LENDERS.

 

SECTION 9.4.            RIGHTS AS A LENDER.  WITH RESPECT TO THE LOAN MADE BY
IT, AGENT IN ITS CAPACITY AS A LENDER HEREUNDER SHALL HAVE THE SAME RIGHTS AND
POWERS HEREUNDER AS ANY OTHER LENDER AND MY EXERCISE THE SAME AS THOUGH IT WERE
NOT ACTING AS AGENT, AND THE TERM “LENDER” OR “LENDERS” SHALL, UNLESS THE
CONTEXT OTHERWISE INDICATES, INCLUDE AGENT IN ITS INDIVIDUAL CAPACITY. AGENT AND
ITS AFFILIATES MAY (WITHOUT HAVING TO ACCOUNT THEREFOR TO ANY LENDER) LEND MONEY
TO, MAKE INVESTMENTS IN AND GENERALLY ENGAGE IN ANY KIND OF BUSINESS WITH
BORROWER OR ANY OF THEIR AFFILIATES AS IF IT WERE NOT ACTING AS AGENT, AND AGENT
AND ITS AFFILIATES MAY ACCEPT FEES AND OTHER CONSIDERATION FROM BORROWER OR SUCH
AFFILIATE FOR SERVICES IN CONNECTION WITH THIS AGREEMENT OR OTHERWISE WITHOUT
HAVING TO ACCOUNT FOR THE SAME TO THE LENDERS.

 

SECTION 9.5.            INDEMNIFICATION.  THE LENDERS AGREE TO INDEMNIFY AGENT
(TO THE EXTENT NOT REIMBURSED BY BORROWER, BUT WITHOUT LIMITING THE OBLIGATIONS
OF BORROWER UNDER THE LOAN DOCUMENTS) RATABLY IN ACCORDANCE WITH THEIR
RESPECTIVE INTERESTS IN THE LOAN, FOR ANY AND ALL LIABILITIES, OBLIGATIONS,
LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES OR
DISBURSEMENTS OF ANY KIND AND NATURE WHATSOEVER THAT MAY BE IMPOSED ON, INCURRED
BY OR ASSERTED AGAINST AGENT (INCLUDING BY ANY LENDER) ARISING OUT OF OR BY
REASON OF ANY INVESTIGATION IN OR IN ANY WAY RELATING TO OR ARISING OUT OF THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT OR ANY OTHER DOCUMENTS CONTEMPLATED BY OR
REFERRED TO HEREIN OR THEREIN OR THE TRANSACTION (INCLUDING, WITHOUT LIMITATION,
THE COSTS AND EXPENSES THAT BORROWER IS OBLIGATED TO PAY UNDER THE LOAN
DOCUMENTS, BUT EXCLUDING, UNLESS A DEFAULT OR EVENT OF DEFAULT HAS OCCURRED AND
IS CONTINUING, NORMAL ADMINISTRATIVE COSTS AND EXPENSES INCIDENT TO THE
PERFORMANCE OF ITS AGENCY DUTIES HEREUNDER) OR THE ENFORCEMENT OF ANY OF THE
TERMS HEREOF OR THEREOF OR OF ANY SUCH OTHER DOCUMENTS, PROVIDED THAT NO LENDER
SHALL BE LIABLE FOR ANY OF THE FOREGOING TO THE EXTENT THEY ARISE FROM THE GROSS
NEGLIGENCE OR WILLFUL MISCONDUCT OF THE PARTY TO BE INDEMNIFIED.

 

SECTION 9.6.            NON-RELIANCE ON AGENT AND OTHER LENDERS.  EACH LENDER
AGREES AND ACKNOWLEDGES THAT IT HAS, INDEPENDENTLY AND WITHOUT RELIANCE ON AGENT
OR ANY OTHER LENDER, AND BASED ON SUCH DOCUMENTS AND INFORMATION AS IT HAS
DEEMED APPROPRIATE, MADE ITS OWN CREDIT ANALYSIS OF BORROWER AND ITS OWN
DECISION TO ENTER INTO THIS AGREEMENT AND THAT IT WILL, INDEPENDENTLY AND
WITHOUT RELIANCE UPON AGENT OR ANY OTHER LENDER, AND BASED ON SUCH DOCUMENTS AND
INFORMATION AS IT SHALL DEEM APPROPRIATE AT THE TIME, CONTINUE TO MAKE ITS OWN
ANALYSIS AND DECISIONS IN TAKING OR NOT TAKING ACTION UNDER THIS AGREEMENT OR
UNDER ANY OTHER

 

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LOAN DOCUMENT. AGENT SHALL NOT BE REQUIRED TO KEEP ITSELF INFORMED AS TO THE
PERFORMANCE OR OBSERVANCE BY BORROWER OF THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS OR TO INSPECT THE PROPERTIES OR BOOKS OF BORROWER OR ANY OF THEIR
AFFILIATES. EXCEPT FOR NOTICES, REPORTS AND OTHER DOCUMENTS AND INFORMATION
EXPRESSLY REQUIRED TO BE FURNISHED TO THE LENDERS BY AGENT HEREUNDER, AGENT
SHALL NOT HAVE ANY DUTY OR RESPONSIBILITY TO PROVIDE ANY LENDER WITH ANY CREDIT
OR OTHER INFORMATION CONCERNING THE AFFAIRS, FINANCIAL CONDITION OR BUSINESS OF
BORROWER OR ANY OF THEIR AFFILIATES THAT MAY COME INTO THE POSSESSION OF AGENT
OR ANY OF ITS AFFILIATES.

 

SECTION 9.7.            FAILURE TO ACT.  EXCEPT FOR ACTION EXPRESSLY REQUIRED OF
AGENT HEREUNDER AND UNDER THE OTHER LOAN DOCUMENTS, AGENT SHALL IN ALL CASES BE
FULLY JUSTIFIED IN FAILING OR REFUSING TO ACT HEREUNDER AND THEREUNDER UNLESS IT
SHALL RECEIVE FURTHER ASSURANCES TO ITS SATISFACTION FROM THE LENDERS OF THEIR
INDEMNIFICATION OBLIGATIONS UNDER SECTION 9.5 HEREOF AGAINST ANY AND ALL
LIABILITY AND EXPENSE THAT MAY BE INCURRED BY IT BY REASON OF TAKING OR
CONTINUING TO TAKE ANY SUCH ACTION.

 

SECTION 9.8.            RESIGNATION OF AGENT.  SUBJECT TO THE APPOINTMENT AND
ACCEPTANCE OF A SUCCESSOR AGENT AS PROVIDED BELOW, AGENT MAY RESIGN UPON GIVING
NOTICE THEREOF TO THE LENDERS; PROVIDED, HOWEVER, THAT SUCH RESIGNATION SHALL
NOT BE EFFECTIVE UNTIL SUCH TIME AS THE SUCCESSOR AGENT IS IN PLACE AND SHALL
DELIVER WRITTEN NOTICE OF SUCH APPOINTMENT TO BORROWER. UPON ANY SUCH
RESIGNATION, THE LENDERS SHALL HAVE THE RIGHT TO APPOINT A SUCCESSOR AGENT,
SUBJECT TO, IF AN EVENT OF DEFAULT HAS NOT OCCURRED AND IS NOT CONTINUING, THE
CONSENT OF THE BORROWER, SUCH CONSENT NOT TO BE UNREASONABLY WITHHELD, DELAYED
OR CONDITIONED. IF NO SUCCESSOR AGENT SHALL HAVE BEEN SO APPOINTED BY THE
LENDERS AND SHALL HAVE ACCEPTED SUCH APPOINTMENT WITHIN 30 DAYS AFTER THE
RETIRING AGENT’S GIVING OF NOTICE OF RESIGNATION, THEN THE RETIRING AGENT MAY,
ON BEHALF OF THE LENDERS APPOINT A SUCCESSOR AGENT, THAT SHALL BE A
SOPHISTICATED FINANCIAL INSTITUTION. UPON THE ACCEPTANCE OF ANY APPOINTMENT AS
AGENT HEREUNDER BY A SUCCESSOR AGENT, SUCH SUCCESSOR AGENT SHALL THEREUPON
SUCCEED TO AND BECOME VESTED WITH ALL THE RIGHTS, POWERS, PRIVILEGES AND DUTIES
OF THE RETIRING AGENT, AND THE RETIRING AGENT SHALL BE DISCHARGED FROM ITS
DUTIES AND OBLIGATIONS HEREUNDER. AFTER ANY RETIRING AGENT’S RESIGNATION
HEREUNDER AS AGENT, THE PROVISIONS OF THIS ARTICLE IX SHALL CONTINUE IN EFFECT
FOR ITS BENEFIT IN RESPECT OF ANY ACTIONS TAKEN OR OMITTED TO BE TAKEN BY IT
WHILE IT WAS ACTING AS AGENT.

 

SECTION 9.9.            AGENCY FEE.  EACH LENDER WILL PAY TO AGENT AN AGENCY FEE
AS MAY BE AGREED UPON BETWEEN SUCH LENDER AND AGENT. BORROWER SHALL NOT BE
LIABLE FOR THE PAYMENT OF SUCH FEE.

 

SECTION 9.10.          CONSENTS UNDER LOAN DOCUMENTS.  AGENT MAY CONSENT TO ANY
MODIFICATION, SUPPLEMENT OR WAIVER UNDER ANY OF THE LOAN DOCUMENTS, PROVIDED
THAT, WITHOUT THE PRIOR CONSENT OF EACH LENDER, AGENT SHALL NOT RELEASE ANY
COLLATERAL OR OTHERWISE TERMINATE ANY LIEN UNDER ANY LOAN DOCUMENT PROVIDING FOR
COLLATERAL SECURITY, OR AGREE TO ADDITIONAL OBLIGATIONS BEING SECURED BY SUCH
COLLATERAL SECURITY (UNLESS THE LIEN FOR SUCH ADDITIONAL OBLIGATIONS SHALL BE
JUNIOR TO THE LIEN IN FAVOR OF THE OBLIGATIONS), EXCEPT THAT NO SUCH CONSENT
SHALL BE REQUIRED, AND AGENT IS HEREBY AUTHORIZED, TO RELEASE ANY LIEN COVERING
COLLATERAL THAT IS THE SUBJECT OF A DISPOSITION PERMITTED HEREUNDER.

 

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SECTION 9.11.          NOTICES, REPORTS AND OTHER COMMUNICATIONS.  AGENT SHALL
PROVIDE, AT ITS EXPENSE, COPIES OF EACH NOTICE, REPORT, DOCUMENT, CORRESPONDENCE
OR OTHER WRITTEN COMMUNICATION DELIVERED TO AGENT BY BORROWER OR ANY AFFILIATE
OF BORROWER PURSUANT TO ANY LOAN DOCUMENT, TO EACH LENDER IDENTIFIED IN SUCH
NOTICE, REPORT, DOCUMENT, CORRESPONDENCE OR OTHER WRITTEN COMMUNICATION OR
REASONABLY DETERMINED BY AGENT TO BE ENTITLED THERETO OR AFFECTED THEREBY, AS
SOON AS PRACTICABLE AFTER AGENT’S RECEIPT THEREOF.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their duly authorized representatives, all as of the day and year
first above written.

 

 

AGENT AND INITIAL LENDER:

 

 

 

 

DEUTSCHE BANK AG, CAYMAN ISLANDS
BRANCH, a Cayman Islands Branch of a Foreign
Bank

 

 

 

 

 

 

 

By:

/s/ Christopher E. Tognola

 

 

Name:  Christopher E. Tognola

 

 

Title:  Managing Director

 

 

 

 

 

 

 

By:

/s/ Mary Brundage

 

 

Name:  Mary Brundage

 

 

Title:  Director

 

 

 

 

 

 

 

HOLDING COMPANY BORROWERS:

 

 

 

 

 

FIRST STATES INVESTORS DB I, L.P.,

 

a Delaware limited partnership

 

 

 

 

 

By:

/s/ Andrew Levine

 

Name:

Andrew Levine

 

Title:

Corporate Secretary and Vice President

 

 

 

 

 

 

 

FIRST STATES INVESTORS DB I B, L.P.,

 

a Delaware limited partnership

 

 

 

 

 

By:

/s/ Andrew Levine

 

Name:

Andrew Levine

 

Title:

Corporate Secretary and Vice President

 

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CURRENT PROPERTY OWNING BORROWERS:

 

 

 

 

FIRST STATES INVESTORS DB I TRS, L.P.,
a Delaware limited partnership

 

 

 

 

 

 

 

By:

/s/ Andrew Levine

 

Name:   Andrew Levine

 

Title:    Corporate Secretary and Vice President

 

 

 

 

 

FIRST STATES INVESTORS DB I SP, L.P.,
a Delaware limited partnership

 

 

 

 

 

By:

/s/ Andrew Levine

 

Name:   Andrew Levine

 

Title:    Corporate Secretary and Vice President

 

 

 

 

 

FIRST STATES INVESTORS 4200, LLC,
a Delaware limited liability company

 

 

 

 

 

By:

/s/ Andrew Levine

 

Name:   Andrew Levine

 

Title:    Corporate Secretary and Vice President

 

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COLLATERAL AGENT:

 

 

 

LASALLE BANK NATIONAL ASSOCIATION, a

 

national banking association (as Collateral Agent for

 

the Lenders only)

 

 

 

 

 

By:

/s/ Rachel M. Kahsen

 

 

Name:  Rachel M. Kahsen

 

 

Title:  Assistant Vice President

 

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