EXHIBIT 10.112
 
LOAN NO. 3411106
 
LOAN AGREEMENT
 
Dated as of March 31, 2010
 
Between
 
PTC COLUMBUS, LLC, a Delaware limited liability company,
as Borrower
 
and
 
BANK OF AMERICA, N.A.,
as Lender
 
 
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TABLE OF CONTENTS
 
Page
 
ARTICLE 1 DEFINITIONS; PRINCIPLES OF CONSTRUCTION
1
Section 1.1
Definitions
1
Section 1.2
Principles of Construction
18
ARTICLE 2 GENERAL TERMS
18
Section 2.1
The Loan
18
Section 2.2
Disbursement to Borrower
18
Section 2.3
The Note, Mortgage and Loan Documents
18
Section 2.4
Loan Payments
18
Section 2.5
Loan Prepayments
19
ARTICLE 3 CONDITIONS PRECEDENT
19
Section 3.1
Conditions Precedent
19
ARTICLE 4 REPRESENTATIONS AND WARRANTIES
19
Section 4.1
Organization
19
Section 4.2
Status of Borrower
19
Section 4.3
Validity of Documents
20
Section 4.4
No Conflicts
20
Section 4.5
Litigation
20
Section 4.6
Agreements
20
Section 4.7
Solvency
21
Section 4.8
Full and Accurate Disclosure
21
Section 4.9
No Plan Assets
21
Section 4.10
Not a Foreign Person
22
Section 4.11
Enforceability
22
Section 4.12
Business Purposes
22
Section 4.13
Compliance
22
Section 4.14
Financial Information
22
Section 4.15
Condemnation
23
Section 4.16
Utilities and Public Access; Parking
23
Section 4.17
Separate Lots
23
Section 4.18
Assessments
23
Section 4.19
Insurance
23
Section 4.20
Use of Property
24
Section 4.21
Certificate of Occupancy; Licenses
24
Section 4.22
Flood Zone
24
Section 4.23
Physical Condition
24
Section 4.24
Boundaries
24
Section 4.25
Leases and Rent Roll
25
Section 4.26
Filing and Recording Taxes
25
Section 4.27
Management Agreement
25
Section 4.28
Illegal Activity
26
Section 4.29
Construction Expenses
26
Section 4.30
Personal Property
26
Section 4.31
Taxes
26

 
 
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Section 4.32
Title
26
Section 4.33
Federal Reserve Regulations
27
Section 4.34
Investment Company Act
27
Section 4.35
Reciprocal Easement Agreements
27
Section 4.36
No Change in Facts or Circumstances; Disclosure
28
Section 4.37
Intellectual Property
28
Section 4.38
Compliance with Anti-Terrorism Laws
28
Section 4.39
Patriot Act
28
Section 4.40
Brokers and Financial Advisors
29
Section 4.41
Survival
29
ARTICLE 5 BORROWER COVENANTS
29
Section 5.1
Existence; Compliance with Requirements
29
Section 5.2
Maintenance and Use of Property
30
Section 5.3
Waste
30
Section 5.4
Taxes and Other Charges
30
Section 5.5
Litigation
31
Section 5.6
Access to Property
31
Section 5.7
Notice of Default
32
Section 5.8
Cooperate in Legal Proceedings
32
Section 5.9
Performance by Borrower
32
Section 5.10
Awards; Insurance Proceeds
32
Section 5.11
Financial Reporting
32
Section 5.12
Estoppel Statement
34
Section 5.13
Leasing Matters
34
Section 5.14
Property Management
36
Section 5.15
Liens
37
Section 5.16
Debt Cancellation
38
Section 5.17
Zoning
38
Section 5.18
ERISA
38
Section 5.19
No Joint Assessment
38
Section 5.20
Reciprocal Easement Agreements
39
Section 5.21
Alterations
39
ARTICLE 6 ENTITY COVENANTS
39
Section 6.1
Single Purpose Entity/Separateness
39
Section 6.2
Change of Name, Identity or Structure
43
Section 6.3
Business and Operations
43
Section 6.4
Independent Director
43
ARTICLE 7 NO SALE OR ENCUMBRANCE
44
Section 7.1
Transfer Definitions
44
Section 7.2
No Sale/Encumbrance
44
Section 7.3
Permitted Transfers
45
Section 7.4
Lender’s Rights
45
Section 7.5
Assumption
46
Section 7.6
Permitted Mezzanine Debt
49
ARTICLE 8 INSURANCE; CASUALTY; CONDEMNATION; RESTORATION 49
Section 8.1
Insurance
49
Section 8.2
Casualty
53
Section 8.3
Condemnation
53
Section 8.4
Restoration
53

 
 
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ARTICLE 9 RESERVE FUNDS
58
Section 9.1
Required Repairs
58
Section 9.2
Replacements
58
Section 9.3
Tenant Improvements and Leasing Commissions
58
Section 9.4
Required Work
59
Section 9.5
Release of Reserve Funds
61
Section 9.6
Tax and Insurance Reserve Funds
64
Section 9.7
Excess Cash; Operating Expenses; Extraordinary Expenses
64
Section 9.8
Holdback Reserve.
65
Section 9.9
Reserve Funds Generally
65
ARTICLE 10 CASH MANAGEMENT
68
Section 10.1
Lockbox Account and Cash Management Account
68
Section 10.2
Deposits and Withdrawals
70
Section 10.3
Security Interest
74
ARTICLE 11 EVENTS OF DEFAULT; REMEDIES
75
Section 11.1
Event of Default
75
Section 11.2
Remedies
77
Section 11.3
Provisions Regarding Letters of Credit
78
ARTICLE 12 ENVIRONMENTAL PROVISIONS
78
Section 12.1
Environmental Representations and Warranties
78
Section 12.2
Environmental Covenants
79
Section 12.3
Lender’s Rights
79
Section 12.4
Operations and Maintenance
80
Section 12.5
Environmental Definitions
80
Section 12.6
Indemnification
81
ARTICLE 13 SECONDARY MARKET
82
Section 13.1
Transfer of Loan
82
Section 13.2
Delegation of Servicing
82
Section 13.3
Dissemination of Information
82
Section 13.4
Cooperation
83
Section 13.5
Securitization
84
Section 13.6
Regulation AB Information
87
Section 13.7
Rating Surveillance
88
Section 13.8
New Mezzanine Loan
88
ARTICLE 14 INDEMNIFICATIONS
89
Section 14.1
General Indemnification
89
Section 14.2
Mortgage and Intangible Tax Indemnification
89
Section 14.3
ERISA Indemnification
89
Section 14.4
Survival
90
ARTICLE 15 EXCULPATION
90
Section 15.1
Exculpation
90
ARTICLE 16 NOTICES
92
Section 16.1
Notices
92
ARTICLE 17 FURTHER ASSURANCES
94
Section 17.1
Replacement Documents
94
Section 17.2
Recording of Mortgage, etc
94
Section 17.3
Further Acts, etc
95

 
 
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Section 17.4
Changes in Tax, Debt, Credit and Documentary Stamp Laws
95
Section 17.5
Expenses
96
Section 17.6
Cost of Enforcement.
96
ARTICLE 18 WAIVERS
97
Section 18.1
Remedies Cumulative; Waivers
97
Section 18.2
Modification, Waiver in Writing
97
Section 18.3
Delay Not a Waiver
97
Section 18.4
Trial by Jury
97
Section 18.5
Waiver of Notice
98
Section 18.6
Remedies of Borrower
98
Section 18.7
Waiver of Marshalling of Assets
98
Section 18.8
Waiver of Statute of Limitations
99
Section 18.9
Waiver of Counterclaim
99
ARTICLE 19 GOVERNING LAW
99
Section 19.1
Choice of Law
99
Section 19.2
Severability
99
Section 19.3
Preferences
99
ARTICLE 20 MISCELLANEOUS
100
Section 20.1
Survival
100
Section 20.2
Lender’s Discretion
100
Section 20.3
Headings
100
Section 20.4
Schedules Incorporated
100
Section 20.5
Offsets, Counterclaims and Defenses
100
Section 20.6
No Joint Venture or Partnership; No Third Party Beneficiaries
100
Section 20.7
Publicity
101
Section 20.8
Conflict; Construction of Documents; Reliance
102
Section 20.9
Duplicate Originals; Counterparts
102
Section 20.10
Entire Agreement
102

 
 
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LOAN AGREEMENT
 
THIS LOAN AGREEMENT, dated as of March 31, 2010 (as amended, restated, replaced,
supplemented or otherwise modified from time to time, this “Agreement”), between
BANK OF AMERICA, N.A., a national banking association, having an address at 214
North Tryon Street, Charlotte, North Carolina 28255 (together with its
successors and/or assigns, “Lender”) and PTC COLUMBUS, LLC, a Delaware limited
liability company having an address at 180 East Broad Street, Columbus, Ohio
43215 (together with its successors and/or assigns, “Borrower”).
 
RECITALS:
 
Borrower desires to obtain the Loan (defined below) from Lender.
 
Lender is willing to make the Loan to Borrower, subject to and in accordance
with the terms of this Agreement and the other Loan Documents (defined below).
 
In consideration of the making of the Loan by Lender and the covenants,
agreements, representations and warranties set forth in this Agreement, the
parties hereto hereby covenant, agree, represent and warrant as follows:
 
ARTICLE 1
DEFINITIONS; PRINCIPLES OF CONSTRUCTION
 
Section 1.1                      Definitions
 
For all purposes of this Agreement, except as otherwise expressly required or
unless the context clearly indicates a contrary intent:
 
“Acceptable Accountant” shall mean (i) a “Big Four” accounting firm, (ii) BDO
Seidman, LLP or (iii) another independent certified public accountant acceptable
to Lender.
 
“Additional Replacement” shall have the meaning set forth in Section 9.5(g)
hereof.
 
“Additional Required Repair” shall have the meaning set forth in Section 9.5(f)
hereof.
 
“Affiliate” shall mean, as to any Person, any other Person that (i) owns
directly or indirectly ten percent (10%) or more of all equity interests in such
Person, and/or (ii) is in control of, is controlled by or is under common
control with such Person, and/or (iii) is a director or officer of such Person
or of an Affiliate of such Person.  As used in this definition, the term
“control” means the power to direct the management and policies of a Person,
directly or indirectly, whether through ownership of voting securities or other
beneficial interests, by contract or otherwise.
 
“Affiliated Manager” shall have the meaning set forth in Section 7.1 hereof.
 
“ALTA” shall mean American Land Title Association, or any successor thereto.
 
 
 

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“Alteration Threshold” means $1,000,000.00.
 
“Annual Budget” shall mean the operating budget, including all planned capital
expenditures, for the Property approved by Lender in accordance with Section
5.11(a)(iv) hereof for the applicable calendar year or other period.
 
“Assignment of Management Agreement” shall mean that certain Assignment and
Subordination of Management Agreement and Consent of Manager dated the date
hereof among Lender, Borrower and Manager, as the same may be amended, restated,
replaced, supplemented or otherwise modified from time to time.
 
“Award” shall mean any compensation paid by any Governmental Authority in
connection with a Condemnation in respect of all or any part of the Property.
 
“Borrower’s Account” shall mean account # 0189-164-3594 maintained by Borrower
or Borrower Principal at Huntington National Bank.
 
“Borrower Principal” shall mean Glimcher Properties Limited Partnership, a
Delaware limited partnership.
 
“Business Day” shall mean a day on which Lender is open for the conduct of
substantially all of its banking business at its office in the city in which the
Note is payable (excluding Saturdays and Sundays).
 
“Cash Management Account” shall have the meaning set forth in Section 10.1(b)
hereof.
 
“Cash Sweep Period” shall mean the period commencing on the date upon which the
Debt Service Coverage Ratio for the Property, as reasonably determined by
Lender, for the immediately preceding twelve (12) month period is less than 1.10
to 1.00, and ending on the date the Debt Service Coverage Ratio equals or
exceeds 1.10 to 1.00 for the immediately preceding twelve (12) month period.
 
“Casualty” shall have the meaning set forth in Section 8.2.
 
“Closing Date” shall mean the date of the funding of the Loan.
 
“Control” shall have the meaning set forth in Section 7.1 hereof.
 
“Condemnation” shall mean a temporary or permanent taking by any Governmental
Authority as the result, in lieu or in anticipation, of the exercise of the
right of condemnation or eminent domain, of all or any part of the Property, or
any interest therein or right accruing thereto, including any right of access
thereto or any change of grade affecting the Property or any part thereof.
 
“Cooperation Cap” shall mean $32,500 for UCC insurance, if applicable, and
reimbursement of Lender’s costs and expenses (including, without limitation,
Lender’s legal fees and fees of the Rating Agencies or any servicers or managers
of a Securitization).
 
 
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“Creditors Rights Laws” shall mean with respect to any Person any existing or
future law of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization, conservatorship, arrangement, adjustment,
winding-up, liquidation, dissolution, assignment for the benefit of creditors,
composition or other relief with respect to its debts or debtors.
 
“Debt” shall mean the outstanding principal amount set forth in, and evidenced
by, this Agreement and the Note together with all interest accrued and unpaid
thereon and all other sums due to Lender in respect of the Loan under the Note,
this Agreement, the Mortgage or any other Loan Document.
 
“Debt Service” shall mean, with respect to any particular period of time,
scheduled principal and/or interest payments under the Note.
 
“Debt Service Coverage Ratio” shall mean, as of any date of determination, for
the applicable period of calculation, the ratio, as determined by Lender, of (i)
Net Operating Income to (ii) the aggregate amount of Debt Service which would be
due for the same period assuming the maximum principal amount of the Loan is
outstanding and calculated using an amortizing mortgage constant based on the
Note Rate and, if applicable pursuant to Section 7.6 hereof, the Mezzanine Loan,
that is outstanding on the date of such calculation using an assumed
amortization schedule of thirty (30) years for such Mezzanine Loan.
 
“Default” shall mean the occurrence of any event hereunder or under any other
Loan Document which, but for the giving of notice or passage of time, or both,
would be an Event of Default.
 
“Default Rate” shall have the meaning set forth in the Note.
 
“Eligible Account” shall mean a separate and identifiable account from all other
funds held by the holding institution that is either (a) an account or accounts
maintained with a federal or state chartered depository institution or trust
company which complies with the definition of Eligible Institution or (b) a
segregated trust account or accounts maintained with the corporate trust
department of a federal or state chartered depository institution or trust
company acting in its fiduciary capacity which, in the case of a federally
chartered depository institution or trust company acting in its fiduciary
capacity is subject to the regulations regarding adversary funds on deposit
therein under 12 C.F.R. §9.10(b), and in the case of a state chartered
depository institution or trust company, is subject to regulations substantially
similar to 12 C.F.R. §9.10(b), having in either case a combined capital surplus
of at least $50,000,000 and subject to supervision or examination by federal and
state authority.  An Eligible Account shall not be evidenced by a certificate of
deposit, passbook or other instrument.
 
“Eligible Institution” shall mean a depository institution or trust company
insured by the Federal Deposit Insurance Corporation, the short term unsecured
debt obligations or commercial paper of which are rated at least “A-1+” by S&P,
“P-1” by Moody’s and “F-1+” by Fitch in the case of accounts in which funds are
held for thirty (30) days or less (or, in the case of accounts in which funds
are held for more than thirty (30) days, the long term unsecured debt
obligations of which are rated at least “AA-” by Fitch and S&P and “Aa2” by
Moody’s), or such other depository institution or trust company approved by the
Rating Agencies from time to time.  Notwithstanding the foregoing, prior to a
Securitization, Bank of America, N.A. shall be an Eligible Institution.
 
 
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“Eligibility Requirements” means, with respect to any Person, that such Person
(i) has, excluding any interest in the Property, total assets (in name or under
management) in excess of $600,000,000 and (except with respect to a pension
advisory firm or similar fiduciary) capital/statutory surplus or shareholder’s
equity of $250,000,000 and (ii) is regularly engaged in the business of owning
or operating commercial properties or interests therein, similar to the Property
or, with respect to the making of a Mezzanine Loan only, making or owning
commercial real estate loans.
 
“Embargoed Person” shall mean any person identified by OFAC or any other Person
with whom a Person resident in the United States of America may not conduct
business or transactions by prohibition of federal law or Executive Order of the
President of the United States of America.
 
“Environmental Law” shall have the meaning set forth in Section 12.5 hereof.
 
“Environmental Liens” shall have the meaning set forth in Section 12.5 hereof.
 
“Environmental Report” shall have the meaning set forth in Section 12.5 hereof.
 
“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time and any successor statutes thereto and applicable
regulations issued pursuant thereto in temporary or final form.
 
“Event of Default” shall have the meaning set forth in Section 11.1 hereof.
 
“Excess Cash” shall have the meaning set forth in Section 10.2(c) hereof .
 
“Excess Cash Reserve Account” shall have the meaning set forth in Section 9.7
hereof.
 
“Excess Cash Reserve Funds” shall have the meaning set forth in Section 9.7
hereof.
 
“Exchange Act” shall mean the Securities and Exchange Act of 1934, as amended.
 
“Exchange Act Filing” shall have the meaning set forth in Section 13.6 hereof.
 
“Extraordinary Expense” shall mean an operating expense or capital expenditure
with respect to the Property that (i) is not set forth on the Annual Budget
approved by Lender, (ii) is not an Operating Expense that has been approved by
Lender, and (iii) is not subject to payment by withdrawals from the Required
Repair Account, the Replacement Reserve Account or the Leasing Reserve
Account.  Borrower shall deliver promptly to Lender a reasonably detailed
explanation of such proposed Extraordinary Expense for the approval of Lender.
 
“Fitch” shall mean Fitch, Inc.
 
“GAAP” shall mean generally accepted accounting principles in the United States
of America as of the date of the applicable financial report.
 
 
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“Governmental Authority” shall mean any court, board, agency, department,
commission, office or other authority of any nature whatsoever for any
governmental unit (federal, state, county,  municipal, city, town, special
district or otherwise) whether now or hereafter in existence.
 
“GRT” shall mean Glimcher Realty Trust.
 
“Hazardous Materials” shall have the meaning set forth in Section 12.5 hereof.
 
“Holdback Estoppel” shall mean a duly executed estoppel certificate attesting to
such facts regarding the related Lease as Lender may require, including, but not
limited to attestations that:  (a) such Lease is in full force and effect; (b)
the premises demised under such Lease have been completed and the Tenant under
the Lease has accepted possession of and is in occupancy of all of its
respective demised premises; (c) the Tenant under such Lease has commenced the
payment of rent under the Lease, there are no offsets, claims or defenses to the
enforcement thereof, and Borrower has no monetary obligations to the Tenant
under such Lease; (d) the rent payable under such Lease is the amount of fixed
rent set forth in the Rent Roll, and there is no claim or basis for a claim by
the Tenant thereunder for an offset or adjustment to the rent; (e) to Tenant’s
knowledge, such Tenant does not have a claim of a default against the landlord
under the Lease; (f) to Tenant’s knowledge there is no present default by
Borrower under such Lease; and (g) such Lease is the valid, binding and
enforceable obligation of the applicable Tenant thereunder and there are no
agreements with the Tenant under the Lease other than as expressly set forth in
the Lease.
 
“Holdback Reserve Account” shall have the meaning set forth in Section 9.8
hereof.
 
“Holdback Reserve Funds” shall have the meaning set forth in Section 9.8 hereof.
 
“Holdback Work” shall have the meaning set forth in Section 9.8 hereof.
 
“Improvements” shall have the meaning set forth in the granting clause of the
Mortgage.
 
“Indemnified Parties” shall mean (a) Lender, (b) any prior owner or holder of
the Loan or Participations in the Loan, (c) any servicer or prior servicer of
the Loan, (d) any Investor or any prior Investor in any Securities, (e) any
trustees, custodians or other fiduciaries who hold or who have held a full or
partial interest in the Loan for the benefit of any Investor or other third
party, (f) any receiver or other fiduciary appointed in a foreclosure or other
Creditors Rights Laws proceeding, (g) any officers, directors, shareholders,
partners, members, employees, agents, servants, representatives, contractors,
subcontractors, affiliates or subsidiaries of any and all of the foregoing, and
(h) the heirs, legal representatives, successors and assigns of any and all of
the foregoing (including, without limitation, any successors by merger,
consolidation or acquisition of all or a substantial portion of the Indemnified
Parties’ assets and business), in all cases whether during the term of the Loan
or as part of or following a foreclosure of the Mortgage.
 
“Independent Director” of any corporation or limited liability company means an
individual who is provided by CT Corporation, Corporation Service Company,
National Registered Agents, Inc., Wilmington Trust Company, Stewart Management
Company, Lord Securities Corporation or, if none of those companies is then
providing professional Independent Directors, another nationally-recognized
company reasonably approved by Lender, in each case that is not an Affiliate of
Borrower and that provides professional Independent Directors and other
corporate services in the ordinary course of its business, and which individual
is duly appointed as a member of the board of directors or board of managers of
such corporation or limited liability company and is not, and has never been,
and will not while serving as Independent Director be, any of the following:
 
 
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(i)                a member, partner, equityholder, manager, director, officer
or employee of Borrower, any SPE Component Entity, or any of their respective
equityholders or Affiliates (other than as an Independent Director of an
Affiliate of Borrower or any SPE Component Entity that is not in the direct
chain of ownership of Borrower and that is required by a creditor to be a single
purpose bankruptcy remote entity, provided that such Independent Director is
employed by a company that routinely provides professional Independent Directors
or managers);
 
(ii)               a creditor, supplier or service provider (including provider
of professional services) to Borrower, any SPE Component Entity, or any of their
respective equityholders or Affiliates (other than a nationally-recognized
company that routinely provides professional Independent Directors and other
corporate services to Borrower, any SPE Component Entity, or any of their
respective equityholders or Affiliates in the ordinary course of business);
 
(iii)              a family member of any such member, partner, equityholder,
manager, director, officer, employee, creditor, supplier or service provider; or
 
(iv)              a Person that controls (whether directly, indirectly or
otherwise) any of (i), (ii) or (iii) above.
 
A natural person who otherwise satisfies the foregoing definition other than
subparagraph (i) by reason of being the Independent Director of a “special
purpose entity” affiliated with Borrower shall not be disqualified from serving
as an Independent Director, provided that the fees that such individual earns
from serving as Independent Directors of such Affiliates in any given year
constitute in the aggregate less than five percent (5%) of such individual’s
annual income for that year.
 
“Insurance Premiums” shall have the meaning set forth in Section 8.1(b) hereof.
 
“Insurance Proceeds” shall have the meaning set forth in Section 8.4(b) hereof.
 
“Internal Revenue Code” shall mean the Internal Revenue Code of 1986, as
amended, as it may be further amended from time to time, and any successor
statutes thereto, and applicable U.S. Department of Treasury regulations issued
pursuant thereto in temporary or final form.
 
“Investor” shall have the meaning set forth in Section 13.3 hereof.
 
“Issuer Group” shall have the meaning set forth in Section 13.5(b) hereof.
 
“Issuer Person” shall have the meaning set forth in Section 13.5(b) hereof.
 
“Lease” shall have the meaning set forth in the Mortgage.
 
“Leasing Reserve Account” shall have the meaning set forth in Section 9.3(b)
hereof.
 
 
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“Leasing Reserve Funds” shall have the meaning set forth in Section 9.3(b)
hereof.
 
“Leasing Reserve Monthly Deposit” shall have the meaning set forth in Section
9.3(b) hereof.
 
“Legal Requirements” shall mean all statutes, laws, rules, orders, regulations,
ordinances, judgments, decrees and injunctions of Governmental Authorities
affecting the Property or any part thereof, or the construction, use,
alteration, ownership or operation thereof, whether now or hereafter enacted and
in force, and all permits, licenses, authorizations and regulations relating
thereto, and all covenants, agreements, restrictions and encumbrances contained
in any instruments, either of record or known to Borrower, at any time in force
affecting the Property or any part thereof, including, without limitation, any
which may (a) require repairs, modifications or alterations in or to the
Property or any part thereof, or (b) in any way limit the use and enjoyment
thereof.
 
“Letter of Credit” shall mean a transferable, clean, irrevocable, unconditional,
standby letter of credit in form, substance and amount reasonably satisfactory
to Lender in its reasonable discretion, issued or confirmed by a commercial bank
with a long term debt obligation rating of “A” or better (or a comparable long
term debt obligation rating) as assigned by the Rating Agencies (the “Minimum
L/C Rating”) and otherwise satisfactory to Lender in its reasonable discretion
(the “Issuing Bank”).  The Letter of Credit shall be payable upon presentation
of a sight draft only to the order of Lender at a New York City bank.  The
Letter of Credit shall have an initial expiration date of not less than one (1)
year and shall be automatically renewed for successive twelve (12) month periods
for the term of the Loan (unless such Letter of Credit provides either that (a)
the issuing bank may elect not to renew the Letter of Credit or (b) the Letter
of Credit will expire pursuant to its terms, in either case, upon written notice
to the beneficiary at least thirty (30) days prior to its expiration date) and
shall provide for multiple draws.  The Letter of Credit shall be transferable by
Lender and its successors and assigns at a New York City bank.
 
“Lien” shall mean any mortgage, deed of trust, lien, pledge, hypothecation,
assignment, security interest, or any other encumbrance, charge or transfer of,
on or affecting Borrower, the Property, 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, the filing of any financing statement, and
mechanic’s, materialmen’s and other similar liens and encumbrances.
 
“LLC Agreement” shall have the meaning set forth in Section 6.1(c).
 
“Loan” shall mean the loan made by Lender to Borrower pursuant to this
Agreement.
 
“Loan Documents” shall mean, collectively, this Agreement, the Note, the
Mortgage, the Assignment of Management Agreement, the Lockbox Agreement, and any
and all other documents, agreements and certificates executed and/or delivered
in connection with the Loan, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.
 
“Lockbox” shall mean the post office address established pursuant to the Lockbox
Agreement and maintained by Lockbox Bank on behalf of Borrower and Lender
pursuant to the terms thereof and to which Borrower shall direct all Rents and
other income from the Property be sent pursuant to the Tenant Direction Letters.
 
 
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“Lockbox Account” shall have the meaning set forth in Section 10.1(a) hereof.
 
“Lockbox Agreement” shall mean that certain Deposit Control Account Agreement by
and among Borrower, Lender and Lockbox Bank, as the same may be amended,
restated, replaced, supplemented or otherwise modified from time to time,
relating to the operation and maintenance of, and application of funds in, the
Lockbox Account.
 
“Lockbox Bank” shall mean Huntington National Bank or any successor Eligible
Institution approved or appointed by Lender acting as Lockbox Bank under the
Lockbox Agreement.
 
“Losses” shall mean any and all claims, suits, liabilities (including, without
limitation, strict liabilities), actions, proceedings, obligations, debts,
damages, losses, costs, expenses, fines, penalties, charges, fees, judgments,
awards, amounts paid in settlement of whatever kind or nature (including but not
limited to legal fees and other costs of defense).
 
“Major Lease” shall mean as to the Property (i) any Lease which, individually or
when aggregated with all other leases at the Property with the same Tenant or
its Affiliate, either (A) accounts for five percent (5%) or more of the
Property’s rental income, or (B) demises 10,000 square feet or more of the
Property’s gross leasable area,  (ii) any Lease which contains any option,
offer, right of first refusal or other similar entitlement to acquire all or any
portion of the Property, or (iii) any instrument guaranteeing or providing
credit support for any Lease meeting the requirements of (i) or (ii) above.
 
“Management Agreement” shall mean the management agreement entered into by and
between Borrower and Manager pursuant to which Manager is to provide management
and other services with respect to the Property, as the same may be amended,
restated, replaced, supplemented or otherwise modified in accordance with the
terms of this Agreement, including, without limitation, a Replacement Management
Agreement, if applicable.
 
“Manager” shall mean Glimcher Properties Limited Partnership, a Delaware limited
partnership, or such other entity selected as the manager of the Property in
accordance with the terms of this Agreement.
 
“Material Action” shall mean, as to any Person, to file or consent to the filing
of, institute, commence or seek relief under, any petition, proceeding, action
or case under any Creditors Rights Laws, to seek or consent to the appointment
of a receiver, liquidator, assignee, trustee, sequestrator, custodian, or any
similar official of or for such Person or a substantial part of its property, to
admit in writing the Company's inability to pay its debts generally as they
become due, or to take action in furtherance of any of the foregoing.
 
“Maturity Date” shall have the meaning set forth in the Note.
 
“Member” shall have the meaning set forth in Section 6.1(c ).
 
“Mezzanine Loan” shall have the meaning set forth in Section 7.6 hereof.
 
 
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“Mold” shall have the meaning set forth in Section 12.5 hereof.
 
“Monthly Payment Amount” shall have the meaning set forth in the Note.
 
“Moody’s” shall mean Moody’s Investors Service, Inc.
 
“Mortgage” shall mean that certain first priority mortgage/deed of trust/deed to
secure debt and security agreement dated the date hereof, executed and delivered
by Borrower as security for the Loan and encumbering the Property, as the same
may be amended, restated, replaced, supplemented or otherwise modified from time
to time.
 
“Net Operating Income” shall mean, with respect to any period of time, the
amount obtained by subtracting Operating Expenses (based on annualized amounts
for any recurring expenses not paid monthly) from Operating Income, as such
amount may be adjusted by Lender in its good faith discretion based on Lender’s
underwriting standards, including without limitation, adjustments for vacancy
allowance.
 
“Net Proceeds” shall have the meaning set forth in Section 8.4(b) hereof.
 
“Net Proceeds Deficiency” shall have the meaning set forth in Section 8.4(b)(vi)
hereof.
 
“Note” shall mean that certain promissory note of even date herewith in the
principal amount of $46,000,000.00, made by Borrower in favor of Lender, as the
same may be amended, restated, replaced, severed, supplemented or otherwise
modified from time to time.
 
“Note Rate” shall have the meaning set forth in the Note.
 
“OFAC” shall have the meaning set forth in Section 4.38 hereof.
 
“Operating Expenses” shall mean, with respect to any period of time, the total
of all expenses actually paid or payable, computed in accordance with GAAP (or
such other method of accounting acceptable to Lender), of whatever kind relating
to the operation, maintenance and management of the Property, including without
limitation, utilities, ordinary repairs and maintenance, Insurance Premiums,
license fees, Taxes and Other Charges, advertising expenses, payroll and related
taxes, computer processing charges, management fees equal to the greater of 4%
of the Operating Income and the management fees actually paid under the
Management Agreement, operational equipment or other lease payments set forth in
the Annual Budget, if applicable, or otherwise approved by Lender, normalized
capital expenditures equal to $137,372 per annum and normalized tenant
improvement costs and/or leasing commissions equal to $264,509 per annum, but
specifically excluding depreciation and amortization, non-recurring or
extraordinary expenses, income taxes, Debt Service, any debt service due in
connection a Mezzanine Loan, any incentive fees due under the Management
Agreement, any item of expense that in accordance with GAAP should be
capitalized but only to the extent the same would qualify for funding from the
Reserve Accounts, any item of expense that would otherwise be covered by the
provisions hereof but which is paid by any Tenant under such Tenant’s Lease or
other agreement, and deposits into the Reserve Accounts.
 
 
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“Operating Income” shall mean, with respect to any period of time, all income,
computed in accordance with GAAP (or such other method of accounting acceptable
to Lender), derived from the ownership and operation of the Property from
whatever source, including, but not limited to, Rents, utility charges,
escalations, forfeited security deposits, interest on credit accounts, service
fees or charges, license fees, parking fees, rent concessions or credits, and
other required pass-throughs but excluding sales, use and occupancy or other
taxes on receipts required to be accounted for by Borrower to any Governmental
Authority, tax rebates, refunds and uncollectible accounts, sales of furniture,
fixtures and equipment, interest income from any source other than the escrow
accounts, Reserve Accounts or other accounts required pursuant to the Loan
Documents, Insurance Proceeds (other than business interruption or other loss of
income insurance), Awards, unforfeited security deposits, utility and other
similar deposits, non-recurring or extraordinary income, including, without
limitation lease termination payments, and any disbursements to Borrower from
the Reserve Accounts.
 
“Oshkosh” shall mean Carter’s Retail, Inc.
 
“Oshkosh Lease” shall mean that certain Lease dated March 4, 2010, between
Polaris Center, LLC, as landlord, as assigned to Borrower, and Oshkosh, as
tenant.
 
“Other Charges” shall mean all ground rents, maintenance charges, impositions
other than Taxes, and any other charges, including, without limitation, vault
charges and license fees for the use of vaults, chutes and similar areas
adjoining the Property, now or hereafter levied or assessed or imposed against
the Property or any part thereof.
 
“Participations” shall have the meaning set forth in Section 13.1 hereof.
 
“Patriot Act” shall have the meaning set forth in Section 4.38 hereof.
 
“Permitted Encumbrances” shall mean collectively, (a) the Lien and security
interests created by the Loan Documents, (b) all Liens, encumbrances and other
matters disclosed in the Title Insurance Policy, (c) Liens, if any, for Taxes
imposed by any Governmental Authority not yet due or delinquent, and (d) such
other title and survey exceptions as Lender has approved or may approve in
writing in Lender’s sole discretion, all of which Lender determines in the
aggregate as of the date hereof do not materially adversely affect the value or
use of the Property or Borrower’s ability to repay the Loan.
 
“Permitted Fund Manager” means any Person that on the date of determination is
(a) any nationally-recognized manager of investment funds investing in debt or
equity interests relating to commercial real estate, (b) investing through or
managing a fund with committed capital of at least $250,000,000 and (c) has not
made an assignment for the benefit of creditors or taken advantage of any
Creditors Rights Laws.
 
“Permitted Investments” shall mean to the extent available from Lender or
Lender’s servicer for deposits in the Reserve Accounts and the Cash Management
Account, any one or more of the following obligations or securities acquired at
a purchase price of not greater than par, including those issued by a servicer
of the Loan, the trustee under any securitization or any of their respective
Affiliates, payable on demand or having a maturity date not later than the
Business Day immediately prior to the date on which the funds used to acquire
such investment are required to be used under this Agreement and meeting one of
the appropriate standards set forth below:
 
 
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(a)           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 including, without limitation, obligations of: the U.S.
Treasury (all direct or fully guaranteed obligations), the Farmers Home
Administration (certificates of beneficial ownership), the General Services
Administration (participation certificates), the U.S. Maritime Administration
(guaranteed Title XI financing), the Small Business Administration (guaranteed
participation certificates and guaranteed pool certificates), the U.S.
Department of Housing and Urban Development (local authority bonds) and the
Washington Metropolitan Area Transit Authority (guaranteed transit bonds);
provided, however, that the investments described in this clause must (i) have a
predetermined fixed dollar of principal due at maturity that cannot vary or
change, (ii) be rated “AAA” or the equivalent by each of the Rating Agencies,
(iii) if rated by S&P, must not have an “r” highlighter affixed to their rating,
(iv) 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 (v) such investments must not be
subject to liquidation prior to their maturity;
 
(b)           Federal Housing Administration debentures;
 
(c)           obligations of the following United States 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); provided, however, that the investments described in
this clause must (i) have a predetermined fixed dollar of principal due at
maturity that cannot vary or change, (ii) if rated by S&P, must not have an “r”
highlighter affixed to their rating, (iii) 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 (iv) such investments must not be subject to liquidation prior to
their maturity;
 
(d)           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 at all times are rated
in the highest short term rating category by each Rating Agency (or, if not
rated by all Rating Agencies, rated by at least one Rating Agency in the highest
short term rating category and otherwise acceptable to each other Rating Agency,
as confirmed in writing that such investment would not, in and of itself, result
in a downgrade, qualification or withdrawal of the initial, or, if higher, then
current ratings assigned to the Securities); provided, however, that the
investments described in this clause must (i) have a predetermined fixed dollar
of principal due at maturity that cannot vary or change, (ii) if rated by S&P,
must not have an “r” highlighter affixed to their rating, (iii) 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 (iv) such investments must not be subject
to liquidation prior to their maturity;
 
(e)           fully Federal Deposit Insurance Corporation-insured demand and
time deposits in, or certificates of deposit of, or bankers’ acceptances with
maturities of not more than 365 days and issued by, any bank or trust company,
savings and loan association or savings bank, the short term obligations of
which at all times are rated in the highest short term rating category by each
Rating Agency (or, if not rated by all Rating Agencies, rated by at least one
Rating Agency in the highest short term rating category and otherwise acceptable
to each other Rating Agency, as confirmed in writing that such investment would
not, in and of itself, result in a downgrade, qualification or withdrawal of the
initial, or, if higher, then current ratings assigned to the Securities);
provided, however, that the investments described in this clause must (i) have a
predetermined fixed dollar of principal due at maturity that cannot vary or
change, (ii) if rated by S&P, must not have an “r” highlighter affixed to their
rating, (iii) 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 (iv) such
investments must not be subject to liquidation prior to their maturity;
 
 
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(f)           debt obligations with maturities of not more than 365 days and at
all times rated by each Rating Agency (or, if not rated by all Rating Agencies,
rated by at least one Rating Agency and otherwise acceptable to each other
Rating Agency, as confirmed in writing that such investment would not, in and of
itself, result in a downgrade, qualification or withdrawal of the initial, or,
if higher, then current ratings assigned to the Securities) in its highest
long-term unsecured rating category; provided, however, that the investments
described in this clause must (i) have a predetermined fixed dollar of principal
due at maturity that cannot vary or change, (ii) if rated by S&P, must not have
an “r” highlighter affixed to their rating, (iii) 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 (iv) such investments must not be subject to liquidation prior to
their maturity;
 
(g)           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 365 days and that at all times is rated by each Rating Agency
(or, if not rated by all Rating Agencies, rated by at least one Rating Agency
and otherwise acceptable to each other Rating Agency, as confirmed in writing
that such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the initial, or, if higher, then current ratings
assigned to the Securities) in its highest short-term unsecured debt rating;
provided, however, that the investments described in this clause must (i) have a
predetermined fixed dollar of principal due at maturity that cannot vary or
change, (ii) if rated by S&P, must not have an “r” highlighter affixed to their
rating, (iii) 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 (iv) such
investments must not be subject to liquidation prior to their maturity;
 
(h)           units of taxable money market funds with maturities of not more
than 365 days, which funds are regulated investment companies, seek to maintain
a constant net asset value per share and invest solely in obligations backed by
the full faith and credit of the United States, which funds have the highest
rating available from each Rating Agency (or, if not rated by all Rating
Agencies, rated by at least one Rating Agency and otherwise acceptable to each
other Rating Agency, as confirmed in writing that such investment would not, in
and of itself, result in a downgrade, qualification or withdrawal of the
initial, or, if higher, then current ratings assigned to the Securities) for
money market funds; and
 
 
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(i)           any other security, obligation or investment which has been
approved as a Permitted Investment in writing by (i) Lender and (ii) each Rating
Agency, as evidenced by a written confirmation that the designation of such
security, obligation or investment as a Permitted Investment will not, in and of
itself, result in a downgrade, qualification or withdrawal of the initial, or,
if higher, then current ratings assigned to the Securities by such Rating
Agency;
 
provided, however, that no obligation or security shall be a Permitted
Investment if (A) such obligation or security evidences a right to receive only
interest payments, (B) the right to receive principal and interest payments on
such obligation or security are derived from an underlying investment that
provides a yield to maturity in excess of one hundred twenty percent (120%) of
the yield to maturity at par of such underlying investment or (C) such
obligation or security has a remaining term to maturity in excess of one (1)
year.
 
“Permitted LTV” shall mean a loan-to-value ratio (based upon a then current
appraisal paid for by Borrower and delivered to Lender and otherwise reasonably
acceptable to Lender) equal to or less than seventy percent (70%).
 
“Person” shall mean any individual, corporation, partnership, joint venture,
limited liability company, 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.
 
“Personal Property” shall have the meaning set forth in the granting clause of
the Mortgage.
 
“Policies” shall have the meaning specified in Section 8.1(b) hereof.
 
“Prohibited Transfer” shall have the meaning set forth in Section 7.2 hereof.
 
“Property” shall mean the parcel of real property, the Improvements thereon and
all Personal Property owned by Borrower and encumbered by the Mortgage, together
with all rights pertaining to such property and Improvements, as more
particularly described in the granting clause of the Mortgage and referred to
therein as the “Property”.
 
“Property Condition Report” shall mean a report prepared by a company
satisfactory to Lender regarding the physical condition of the Property,
satisfactory in form and substance to Lender in its sole discretion.
 
“Provided Information” shall have the meaning set forth in Section 13.4 hereof.
 
“Qualified Manager” shall mean Manager or a reputable and experienced
professional management organization (a) which manages, together with its
affiliates, at least ten (10) retail community centers or “power centers”
totaling at least 4,000,000 square feet of gross leasable area (including all
anchor space), exclusive of the Property and (b) approved by Lender, which
approval shall not have been unreasonably withheld and for which Lender shall
have received (i) written confirmation from the Rating Agencies that the
employment of such manager will not result in a downgrade, withdrawal or
qualification of the initial, or if higher, then current ratings issued in
connection with a Securitization, or if a Securitization has not occurred, any
ratings to be assigned in connection with a Securitization, and (ii) with
respect to any replacement Affiliated Manager, a revised substantive
non-consolidation opinion acceptable to Lender and the Rating Agencies.
 
 
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“Qualified Mezzanine Lender” shall mean one or more of the following:
 
(a)           a real estate investment trust, bank, saving and loan association,
investment bank, insurance company, trust company, commercial credit
corporation, pension plan, pension fund or pension advisory firm, mutual fund,
government entity or plan, provided that any such Person referred to in this
clause (a) satisfies the Eligibility Requirements;
 
(b)           an investment company, money management firm or “qualified
institutional buyer” within the meaning of Rule 144A under the Securities Act of
1933, as amended, or an institutional “accredited investor” within the meaning
of Regulation D under the Securities Act of 1933, as amended, provided that any
such Person referred to in this clause (b) satisfies the Eligibility
Requirements;
 
(c)           an institution substantially similar to any of the foregoing
entities described in clauses (a) or (b) that satisfies the Eligibility
Requirements;
 
(d)           any entity Controlled by any of the entities described in clauses
(a) or (c);
 
(e)           a Qualified Trustee in connection with a securitization of, the
creation of collateralized debt obligations (“CDO”) secured by or financing
through an “owner trust” of, the Mezzanine Loan (collectively, “Securitization
Vehicles”), so long as (A) the special servicer or manager of such
Securitization Vehicle has the Required Special Servicer Rating and (B) the
entire “controlling class” of such Securitization Vehicle, other than with
respect to a CDO Securitization Vehicle, is held by one or more entities that
are otherwise Qualified Mezzanine Lenders under clauses (a), (b), (c), or (d) of
this definition; provided that the operative documents of the related
Securitization Vehicle require that (1) in the case of a CDO Securitization
Vehicle, the “equity interest” in such Securitization Vehicle is owned by one or
more entities that are Qualified Mezzanine Lenders under clauses (a), (b), (c),
or (d) of this definition and (2) if any of the relevant trustee, special
servicer, manager fails to meet the requirements of this clause (e), such Person
must be replaced by a Person meeting the requirements of this clause (e) within
thirty (30) days;
 
(f)           an investment fund, limited liability company, limited partnership
or general partnership where a Permitted Fund Manager or an entity that is
otherwise a Qualified Mezzanine Lender under clauses (a), (b), (c), or (d) of
this definition acts as the general partner, managing member or fund manager and
at least 50% of the equity interests in such investment vehicle are owned,
directly or indirectly, by one or more entities that are otherwise Qualified
Mezzanine Lender under clauses (a), (b), (c), or (d) of this definition.
 
“Qualified Transferee” means a single purpose entity meeting the requirements of
Article 6 hereof which is wholly owned and Controlled by:
 
(A)           Borrower Principal;
 
(B)           a real estate investment trust, a bank, saving and loan
association, investment bank, insurance company, trust company, commercial
credit corporation, pension plan, pension fund or pension advisory firm, mutual
fund, government entity or plan or other Person, provided that any such Person
referred to in this clause (B) satisfies the Eligibility Requirements; or
 
 
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(B)           an investment fund or institution substantially similar to any of
the foregoing entities described in clause (B) that satisfies the Eligibility
Requirements.
 
“Qualified Trustee” means (i) a corporation, national bank, national banking
association or a trust company, organized and doing business under the laws of
any state or the United States of America, authorized under such laws to
exercise corporate trust powers and to accept the trust conferred, having a
combined capital and surplus of at least $100,000,000 and subject to supervision
or examination by federal or state authority, (ii) an institution insured by the
Federal Deposit Insurance Corporation or (iii) an institution whose long-term
senior unsecured debt is rated either of the then in effect top two rating
categories of each of the Rating Agencies.
 
“Rating Agencies” shall mean each of S&P, Moody’s, Fitch, Realpoint LLC and
DBRS, Inc., or any other nationally-recognized statistical rating agency which
has been approved by Lender; provided however, after a Securitization, the term
“Rating Agencies” as used in this Agreement shall be limited to those
statistical rating agencies that have, in fact, rated the Securities.
 
“REA” shall mean any construction, operation and reciprocal easement agreement
or similar agreement (including any separate agreement or other agreement
between Borrower and one or more other parties to an REA with respect to such
REA) affecting the Property or portion thereof.
 
“Regulation AB” shall mean Regulation AB under the Securities Act and the
Exchange Act, as the same may be amended from time to time.
 
“Related Loan” shall have the meaning set forth in Section 13.6 hereof.
 
“Regulation Property” shall have the meaning set forth in Section 13.6 hereof.
 
“Release” shall have the meaning set forth in Section 12.5 hereof.
 
“Rent Roll” shall have the meaning set forth in Section 4.25 hereof, the form
for which is attached to this Agreement as Exhibit C.
 
“Rents” shall have the meaning set forth in the Mortgage.
 
“Replacement Management Agreement” shall mean, collectively, (a) either (i) a
management agreement with a replacement Qualified Manager substantially in the
same form and substance as the Management Agreement, or (ii) a management
agreement with a replacement Qualified Manager, which management agreement shall
be acceptable to Lender in form and substance, provided, with respect to this
subclause (ii), Lender, at its option, may require that Borrower obtain
confirmation from the applicable Rating Agencies that such management agreement
will not result in a downgrade, withdrawal or qualification of the initial, or
if higher, then current rating of the Securities or any class thereof; and (b) a
conditional assignment of management agreement substantially in the form of the
Assignment of Management Agreement (or such other form acceptable to Lender),
executed and delivered to Lender by Borrower and such replacement Qualified
Manager at Borrower’s expense and (c) if such replacement manager is an
Affiliated Manager, Borrower shall have delivered, or cause to be delivered, to
Lender, an updated substantive non-consolidation opinion acceptable to Lender
with respect to such Affiliated Manager.
 
 
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“Replacement Reserve Account” shall have the meaning set forth in Section 9.2(b)
hereof.
 
“Replacement Reserve Funds” shall have the meaning set forth in Section 9.2(b)
hereof.
 
“Replacement Reserve Monthly Deposit” shall have the meaning set forth in
Section 9.2(b) hereof.
 
“Replacements” shall have the meaning set forth in Section 9.2(a) hereof.
 
“Required Repair Account” shall have the meaning set forth in Section 9.1(b)
hereof.
 
“Required Repair Funds” shall have the meaning set forth in Section 9.1(b)
hereof.
 
“Required Repairs” shall have the meaning set forth in Section 9.1(a) hereof.
 
“Required Special Servicer Rating” means (i) a rating of “CSS1” in the case of
Fitch, (ii) on the S&P list of approved special servicers in the case of S&P and
(iii) in the case of Moody’s, such special servicer is acting as special
servicer in a commercial mortgage loan securitization that was rated by Moody’s
within the twelve (12) month period prior to the date of determination, and
Moody’s has not downgraded or withdrawn the then-current rating on any class of
commercial mortgage securities or placed any class of commercial mortgage
securities on watch citing the continuation of such special servicer as special
servicer of such commercial mortgage securities.
 
“Required Work” shall have the meaning set forth in Section 9.4 hereof.
 
“Reserve Accounts” shall mean the Required Repair Account, the Tax and Insurance
Reserve Account, the Replacement Reserve Account, the Excess Cash Reserve
Account, the Leasing Reserve Account, the Holdback Reserve Account or any other
escrow account established by the Loan Documents.
 
“Reserve Funds” shall mean the Tax and Insurance Reserve Funds, the Replacement
Reserve Funds, the Required Repair Funds, the Excess Cash Reserve Funds, the
Holdback Reserve Funds, the Leasing Reserve Funds or any other escrow funds
established by the Loan Documents.
 
“Restoration” shall mean, following the occurrence of a Casualty or a
Condemnation which is of a type necessitating the repair of the Property, the
completion of the repair and restoration of the Property to a condition such
that the Property shall be at least equal in value to that immediately prior to
such Casualty or Condemnation, and as near as possible to the condition the
Property was in immediately prior to such Casualty or Condemnation, with such
alterations as may be reasonably approved by Lender.
 
 
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“Restoration Consultant” shall have the meaning set forth in Section 8.4(b)(iii)
hereof.
 
“Restoration Retainage” shall have the meaning set forth in Section 8.4(b)(iv)
hereof.
 
“Restricted Party” shall have the meaning set forth in Section 7.1 hereof.
 
“Sale or Pledge” shall have the meaning set forth in Section 7.1 hereof.
 
“Scheduled Payment Date” shall have the meaning set forth in the Note.
 
“Securities” shall have the meaning set forth in Section 13.1 hereof.
 
“Securities Act” shall mean the Securities Act of 1933, as amended.
 
“Securities Liabilities” shall have the meaning set forth in Section 13.5(b)
hereof.
 
“Securitization” shall have the meaning set forth in Section 13.1 hereof.
 
“Short Term Lease” shall mean any Lease at the Property which is (i) has an
original term, including any extension options, of not more than thirteen (13)
months, (ii) demises 1,000 square feet or less of the Property’s gross leasable
area and (iii) is cancellable by Borrower, without penalty or other expense, on
not more than ninety (90) days notice to the applicable Tenant.
 
“Special Member” shall have the meaning set forth in Section 6.1(c).
 
“SPE Component Entity” shall have the meaning set forth in Section 6.1(b)
hereof.
 
“S&P” shall mean Standard & Poor’s Ratings Services, a division of The
McGraw-Hill Companies, Inc.
 
“State” shall mean the state in which the Property or any part thereof is
located.
 
“Tax and Insurance Reserve Funds” shall have the meaning set forth in Section
9.6 hereof.
 
“Tax and Insurance Reserve Account” shall have the meaning set forth in Section
9.6 hereof.
 
“Taxes” shall mean all real estate and personal property taxes, assessments,
water rates or sewer rents, now or hereafter levied or assessed or imposed
against the Property or part thereof.
 
“Tenant” shall mean any Person leasing, subleasing or otherwise occupying any
portion of the Property under a Lease or other occupancy agreement with
Borrower.
 
“Tenant Direction Letter” shall have the meaning set forth in Section 10.2(a)(i)
hereof.
 
“Termination Fee Deposit” shall have the meaning set forth in Section 9.3(b).
 
“Terrorism Insurance” shall have the meaning set forth in Section 8.1(e)(v).
 
 
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“Terrorism Insurance Cap” shall have the meaning set forth in Section 8.1(e)(v).
 
“Title Insurance Policy” shall mean that certain ALTA (or its equivalent)
mortgagee title insurance policy issued with respect to the Property and
insuring the lien of the Mortgage.
 
“Transferee” shall have the meaning set forth in Section 7.5 hereof.
 
“UCC” or “Uniform Commercial Code” shall mean the Uniform Commercial Code as in
effect in the State where the applicable Property is located.
 
“Underwriter Group” shall have the meaning set forth in Section 13.5(b) hereof.
 
“Ulta” shall mean Ulta Salon, Cosmetics & Fragrance, Inc..
 
“Ulta Lease” shall mean that certain Lease dated March 26, 2010, between Polaris
Center, LLC, as landlord, as assigned to Borrower, and Ulta as tenant.
 
Section 1.2                      Principles of Construction
 
All references to sections and schedules are to sections and schedules in or to
this Agreement unless otherwise specified.  All uses of the word “including”
shall mean “including, without limitation” unless the context shall indicate
otherwise.  Unless otherwise specified, the words “hereof,” “herein” and
“hereunder” and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement.  Unless otherwise specified, all meanings attributed to defined terms
herein shall be equally applicable to both the singular and plural forms of the
terms so defined.
 
ARTICLE 2
GENERAL TERMS
 
Section 2.1                      The Loan
 
Subject to and upon the terms and conditions set forth herein, Lender hereby
agrees to make and Borrower hereby agrees to accept the Loan on the Closing
Date.
 
Section 2.2                      Disbursement to Borrower
 
Borrower may request and receive only one borrowing in respect of the Loan and
any amount borrowed and repaid in respect of the Loan may not be reborrowed.
 
Section 2.3                      The Note, Mortgage and Loan Documents
 
The Loan shall be evidenced by the Note and secured by the Mortgage and the
other Loan Documents.
 
Section 2.4                      Loan Payments
 
The Loan and interest thereon shall be payable pursuant to the terms of the
Note.
 
 
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Section 2.5                      Loan Prepayments
 
The Loan may not be prepaid, in whole or in part, except in strict accordance
with the express terms and conditions of the Note.
 
ARTICLE 3
CONDITIONS PRECEDENT
 
Section 3.1                      Conditions Precedent
 
The obligation of Lender to make the Loan hereunder is subject to the
fulfillment by Borrower or waiver by Lender of all of the conditions precedent
to closing set forth in the application or term sheet for the Loan delivered by
Borrower to Lender and the commitment or commitment rider, if any, to the
application for the Loan issued by Lender.
 
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
 
Borrower and, where specifically indicated, each Borrower Principal, represents
and warrants to Lender as of the Closing Date that:
 
Section 4.1                      Organization
 
Borrower and each Borrower Principal (when not an individual) (a) has been duly
organized and is validly existing and in good standing with requisite power and
authority to own its properties and to transact the businesses in which it is
now engaged, (b) is duly qualified to do business and is in good standing in
each jurisdiction where it is required to be so qualified in connection with its
properties, businesses and operations, (c) possesses all rights, licenses,
permits and authorizations, governmental or otherwise, necessary to entitle it
to own its properties and to transact the businesses in which it is now engaged,
and the sole business of Borrower is the ownership, management and operation of
the Property, and (d) in the case of Borrower, has full power, authority and
legal right to mortgage, grant, bargain, sell, pledge, assign, warrant, transfer
and convey the Property pursuant to the terms of the Loan Documents, and in the
case of Borrower and each Borrower Principal, has full power, authority and
legal right to keep and observe all of the terms of the Loan Documents to which
it is a party.  Borrower and each Borrower Principal represent and warrant that
the chart attached hereto as Exhibit A sets forth an accurate listing of the
direct and indirect owners of the equity interests in Borrower, each SPE
Component Entity (if any) and each Borrower Principal (when not an individual).
 
Section 4.2                      Status of Borrower
 
Borrower’s exact legal name is correctly set forth on the first page of this
Agreement, on the Mortgage and on any UCC-1 Financing Statements filed in
connection with the Loan.  Borrower is an organization of the type specified on
the first page of this Agreement.  Borrower is incorporated in or organized
under the laws of the state of Delaware. Borrower’s principal place of business
and chief executive office, and the place where Borrower keeps its books and
records, including recorded data of any kind or nature, regardless of the medium
of recording, including software, writings, plans, specifications and
schematics, has been for the preceding four months (or, if less, the entire
period of the existence of Borrower) the address of Borrower set forth on the
first page of this Agreement.  Borrower’s organizational identification number,
if any, assigned by the state of incorporation or organization is correctly set
forth on the first page of the Note.
 
 
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Section 4.3                      Validity of Documents
 
Borrower and each Borrower Principal have taken all necessary action to
authorize the execution, delivery and performance of this Agreement and the
other Loan Documents to which they are parties.  This Agreement and such other
Loan Documents have been duly executed and delivered by or on behalf of Borrower
and each Borrower Principal and constitute the legal, valid and binding
obligations of Borrower and each Borrower Principal enforceable against Borrower
and each Borrower Principal in accordance with their respective terms, subject
only to applicable bankruptcy, insolvency and similar laws affecting rights of
creditors generally, and subject, as to enforceability, to general principles of
equity (regardless of whether enforcement is sought in a proceeding in equity or
at law).
 
Section 4.4                      No Conflicts
 
The execution, delivery and performance of this Agreement and the other Loan
Documents by Borrower and each Borrower Principal will not conflict with or
result in a breach of any of the terms or provisions of, or constitute a default
under, or result in the creation or imposition of any lien, charge or
encumbrance (other than pursuant to the Loan Documents) upon any of the property
or assets of Borrower or any Borrower Principal pursuant to the terms of any
agreement or instrument to which Borrower or any Borrower Principal is a party
or by which any of Borrower’s or Borrower Principal’s property or assets is
subject, nor will such action result in any violation of the provisions of any
statute or any order, rule or regulation of any Governmental Authority having
jurisdiction over Borrower or any Borrower Principal or any of Borrower’s or
Borrower Principal’s properties or assets, and any consent, approval,
authorization, order, registration or qualification of or with any Governmental
Authority required for the execution, delivery and performance by Borrower or
Borrower Principal of this Agreement or any of the other Loan Documents has been
obtained and is in full force and effect.
 
Section 4.5                      Litigation
 
There are no actions, suits or proceedings at law or in equity by or before any
Governmental Authority or other agency now pending or, to Borrower’s or Borrower
Principal’s knowledge, threatened against or affecting Borrower, any Borrower
Principal, Manager or the Property, which actions, suits or proceedings, if
determined against Borrower, any Borrower Principal, Manager or the Property,
would materially adversely affect the condition (financial or otherwise) or
business of Borrower or any Borrower Principal or the condition or ownership of
the Property.
 
Section 4.6                      Agreements
 
Borrower is not a party to any agreement or instrument or subject to any
restriction which would materially and adversely affect Borrower or the
Property, or Borrower’s business, properties or assets, operations or condition,
financial or otherwise.  Borrower is not in default in any material respect 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 the Property is bound.  Borrower has no material financial
obligation under any agreement or instrument to which Borrower is a party or by
which Borrower or the Property is otherwise bound, other than (a) obligations
incurred in the ordinary course of the operation of the Property and (b)
obligations under the Loan Documents.
 
 
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Section 4.7                      Solvency
 
Borrower and each Borrower Principal have (a) not entered into the transaction
or executed the Note, this Agreement or any other Loan Documents with the actual
intent to hinder, delay or defraud any creditor and (b) received reasonably
equivalent value in exchange for their obligations under such Loan
Documents.  Giving effect to the Loan, the fair saleable value of the assets of
Borrower and each Borrower Principal exceeds and will, immediately following the
making of the Loan, exceed the total liabilities of Borrower and each Borrower
Principal, including, without limitation, subordinated, unliquidated, disputed
and contingent liabilities.  No petition in bankruptcy has been filed against
Borrower, any Borrower Principal, any SPE Component Entity (if any) or Manager
in the last ten (10) years, and neither Borrower nor any Borrower Principal, any
SPE Component Entity (if any) or Manager in the last ten (10) years has made an
assignment for the benefit of creditors or taken advantage of any Creditors
Rights Laws.  Neither Borrower nor any Borrower Principal, any SPE Component
Entity (if any) or Manager is contemplating either the filing of a petition by
it under any Creditors Rights Laws or the liquidation of all or a major portion
of Borrower’s assets or property, and Borrower has no knowledge of any Person
contemplating the filing of any such petition against Borrower or  any Borrower
Principal, any SPE Component Entity (if any) or Manager.
 
Section 4.8                      Full and Accurate Disclosure
 
No statement of fact made by or on behalf of Borrower or any Borrower Principal
in this Agreement or in any of the other Loan Documents or in any other document
or certificate delivered by or on behalf of Borrower or any Borrower Principal
contains any untrue statement of a material fact or omits to state any material
fact necessary to make statements contained herein or therein not
misleading.  There is no material fact presently known to Borrower or any
Borrower Principal which has not been disclosed to Lender which adversely
affects, nor as far as Borrower or any Borrower Principal can reasonably
foresee, might adversely affect, the Property or the business, operations or
condition (financial or otherwise) of Borrower or any Borrower Principal.
 
Section 4.9                      No Plan Assets
 
Borrower is not an “employee benefit plan,” as defined in Section 3(3) of ERISA,
subject to Title I of ERISA, and none of the assets of Borrower constitutes or
will constitute “plan assets” of one or more such plans within the meaning of 29
C.F.R. Section 2510.3-101.  In addition, (a) Borrower is not a “governmental
plan” within the meaning of Section 3(32) of ERISA and (b) transactions by or
with Borrower are not subject to state statutes regulating investment of, and
fiduciary obligations with respect to, governmental plans similar to the
provisions of Section 406 of ERISA or Section 4975 of the Internal Revenue Code
currently in effect, which prohibit or otherwise restrict the transactions
contemplated by this Agreement.
 
 
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Section 4.10                    Not a Foreign Person
 
Neither Borrower nor Borrower Principal is a foreign corporation, foreign
partnership, foreign trust, foreign estate or nonresident alien or a disregarded
entity owned by any of them (as those terms are defined in the Internal Revenue
Code of 1986), and if requested by Lender, Borrower or Borrower Principal will
so certify (or in the case of a disregarded entity, its owner will certify) to
Lender or a person designated by Lender under penalties of perjury to the
accuracy of this representation, and will provide in such certification such
additional information as Lender may reasonably request.
 
Section 4.11                    Enforceability
 
The Loan Documents are not subject to any right of rescission, set-off,
counterclaim or defense by Borrower or Borrower Principal, including the defense
of usury, nor would the operation of any of the terms of the Loan Documents, or
the exercise of any right thereunder, render the Loan Documents unenforceable,
and neither Borrower nor Borrower Principal has asserted any right of
rescission, set-off, counterclaim or defense with respect thereto.  No Default
or Event of Default exists under or with respect to any Loan Document.
 
Section 4.12                    Business Purposes
 
The Loan is solely for the business purpose of Borrower, and is not for
personal, family, household, or agricultural purposes.
 
Section 4.13                    Compliance
 
Borrower and the Property, and the use and operation thereof, comply in all
material respects with all Legal Requirements, including, without limitation,
building and zoning ordinances and codes and the Americans with Disabilities
Act.  To Borrower’s knowledge, Borrower is not in default or violation of any
order, writ, injunction, decree or demand of any Governmental Authority and
Borrower has received no written notice of any such default or violation.  There
has not been committed by Borrower or, to Borrower’s knowledge, any other Person
in occupancy of or involved with the operation or use of the Property any act or
omission affording any Governmental Authority the right of forfeiture as against
the Property or any part thereof or any monies paid in performance of Borrower’s
obligations under any of the Loan Documents.
 
Section 4.14                    Financial Information
 
All financial data, including, without limitation, the balance sheets,
statements of cash flow, statements of income and operating expense and Rent
Rolls, that have been delivered to Lender in respect of Borrower, any Borrower
Principal and/or the Property (a) are true, complete and correct in all material
respects, (b) accurately represent the financial condition of Borrower, Borrower
Principal or the Property, as applicable, as of the date of such reports, and
(c) to the extent prepared or audited by an independent certified public
accounting firm, have been prepared in accordance with GAAP throughout the
periods covered, except as disclosed therein.  Borrower does not have any
contingent liabilities, liabilities for taxes, unusual forward or long-term
commitments or unrealized or anticipated losses from any unfavorable commitments
that are known to Borrower and reasonably likely to have a material adverse
effect on the Property or the current and/or intended operation thereof, except
as referred to or reflected in said financial statements.  Since the date of
such financial statements, there has been no materially adverse change in the
financial condition, operations or business of Borrower or Borrower Principal
from that set forth in said financial statements.
 
 
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Section 4.15                    Condemnation
 
No Condemnation or other proceeding has been commenced or, to Borrower’s best
knowledge, is threatened or contemplated with respect to all or any portion of
the Property or for the relocation of roadways providing access to the Property.
 
Section 4.16                    Utilities and Public Access; Parking
 
The Property has adequate rights of access to public ways and is served by
water, sewer, sanitary sewer and storm drain facilities adequate to service the
Property for full utilization of the Property for its intended uses.  All public
utilities necessary to the full use and enjoyment of the Property as currently
used and enjoyed are located either in the public right-of-way abutting the
Property (which are connected so as to serve the Property without passing over
other property) or in recorded easements serving the Property and such easements
are set forth in and insured by the Title Insurance Policy.  All roads necessary
for the use of the Property for its current purposes have been completed and
dedicated to public use and accepted by all Governmental Authorities.  The
Property has, or is served by, parking to the extent required to comply with all
Legal Requirements.
 
Section 4.17                    Separate Lots
 
The Property is assessed for real estate tax purposes as one or more wholly
independent tax lot or lots, separate from any adjoining land or improvements
not constituting a part of such lot or lots, and no other land or improvements
is assessed and taxed together with the Property or any portion thereof.
 
Section 4.18                    Assessments
 
To Borrower’s knowledge, there are no pending or 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.
 
Section 4.19                    Insurance
 
Borrower has obtained and has delivered to Lender certified copies of all
Policies or, to the extent such Policies are not available as of the Closing
Date, certificates of insurance with respect to all such Policies reflecting the
insurance coverages, amounts and other requirements set forth in this
Agreement.  No claims have been made under any of the Policies, and to
Borrower’s knowledge, no Person, including Borrower, has done, by act or
omission, anything which would impair the coverage of any of the Policies.
 
 
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Section 4.20                    Use of Property
 
The Property is used exclusively for retail purposes and other appurtenant and
related uses.
 
Section 4.21                    Certificate of Occupancy; Licenses
 
All certifications, permits, licenses and approvals, including, without
limitation, certificates of completion or occupancy and any applicable liquor
license required for the legal use, occupancy and operation of the Property for
the purpose intended herein, have been obtained and are valid and in full force
and effect.  Borrower shall keep and maintain (or cause to be kept and
maintained) all licenses necessary for the operation of the Property for the
purpose intended herein.  The use being made of the Property is in conformity
with the final certificate of occupancy (or compliance, if applicable) and any
other permits or licenses issued for the Property.
 
Section 4.22                    Flood Zone
 
None of the Improvements on the Property are located in an area identified by
the Federal Emergency Management Agency as an area having special flood hazards,
or, if any portion of the Improvements is located within such area, Borrower has
obtained the insurance prescribed in Section 8.1(a)(i).
 
Section 4.23                    Physical Condition
 
Except as set forth in the Property Condition Report, to Borrower’s knowledge
after due inquiry, the Property, including, without limitation, all buildings,
improvements, parking facilities, sidewalks, storm drainage systems, roofs,
plumbing systems, HVAC systems, fire protection systems, electrical systems,
equipment, elevators, exterior sidings and doors, landscaping, irrigation
systems and all structural components, are in good condition, order and repair
in all material respects.  Except as set forth in the Property Condition Report,
to Borrower’s knowledge after due inquiry, there exists no structural or other
material defects or damages in the Property, as a result of a Casualty or
otherwise, and whether latent or otherwise.  Borrower has not received notice
from any insurance company or bonding company of any defects or inadequacies in
the Property, or any part thereof, which would adversely affect the insurability
of the same or cause the imposition of extraordinary premiums or charges thereon
or of any termination or threatened termination of any policy of insurance or
bond.
 
Section 4.24                    Boundaries
 
(a)           None of the Improvements which were included in determining the
appraised value of the Property lie outside the boundaries and building
restriction lines of the Property to any material extent, and (b) no
improvements on adjoining properties encroach upon the Property and no easements
or other encumbrances upon the Property encroach upon any of the Improvements so
as to materially affect the value or marketability of the Property.
 
 
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Section 4.25                    Leases and Rent Roll
 
Borrower has delivered to Lender a true, correct and complete rent roll for the
Property which includes all Leases (other than Short Term Leases) affecting the
Property (including schedules for all executed Leases for Tenants not yet in
occupancy or under which the rent commencement date has not occurred) (a “Rent
Roll”) .  Except as set forth in (i) the Rent Roll (as same has been updated by
written notice thereof to Lender), (ii) Schedule 4.25 attached hereto and (iii)
estoppel certificates delivered to Lender on or prior to the Closing Date:  (a)
each Lease is in full force and effect; (b) the premises demised under the
Leases have been completed and the Tenants under the Leases have accepted
possession of and are in occupancy of all of their respective demised premises;
(c) the Tenants under the Leases have commenced the payment of rent under the
Leases, there are no offsets, claims or defenses to the enforcement thereof, and
Borrower has no monetary obligations to any Tenant under any Lease; (d) all
Rents due and payable under the Leases have been paid and no portion thereof has
been paid for any period more than thirty (30) days in advance; (e) the rent
payable under each Lease is the amount of fixed rent set forth in the Rent Roll,
and there is no claim or basis for a claim by the Tenant thereunder for an
offset or adjustment to the rent; (f) no Tenant has made any written claim of a
material default against the landlord under any Lease which remains outstanding
nor has Borrower or Manager received, by telephonic, in-person, e-mail or other
communication, any notice of a material default under any Lease; (g) to
Borrower’s knowledge there is no present material default by the Tenant under
any Lease; (h) all security deposits under the Leases have been collected by
Borrower; (i) Borrower is the sole owner of the entire landlord’s interest in
each Lease; (j) each Lease is the valid, binding and enforceable obligation of
Borrower and the applicable Tenant thereunder and there are no agreements with
the Tenants under the Leases other than as expressly set forth in the Leases;
(k) no Person has any possessory interest in, or right to occupy, the Property
or any portion thereof except under the terms of a Lease;  (l) none of the
Leases contains any option or offer to purchase or right of first refusal or
right of first offer to purchase the Property or any part thereof; (m) neither
the Leases nor the Rents have been assigned, pledged or hypothecated except to
Lender, and no other Person has any interest therein except the Tenants
thereunder; and (n) no conditions exist which now give any Tenant or party the
right to “go dark” pursuant to the provision of its Lease and/or the REA.
 
Section 4.26                     Filing and Recording Taxes
 
All mortgage, mortgage recording, stamp, intangible or other similar tax
required to be paid by any Person under applicable Legal Requirements currently
in effect in connection with the execution, delivery, recordation, filing,
registration, perfection or enforcement of any of the Loan Documents, including,
without limitation, the Mortgage, have been paid or will be paid by Borrower,
and, under current Legal Requirements, the Mortgage is enforceable in accordance
with its terms by Lender (or any subsequent holder thereof).
 
Section 4.27                     Management Agreement
 
The Management Agreement is in full force and effect and there is no default
thereunder by any party thereto and, to Borrower’s knowledge, no event has
occurred that, with the passage of time and/or the giving of notice would
constitute a default thereunder.  No management fees under the Management
Agreement are accrued and unpaid.
 
 
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Section 4.28                     Illegal Activity
 
No portion of the Property has been or will be purchased, improved, equipped or
fixtured with proceeds of any illegal activity, and no part of the proceeds of
the Loan will be used in connection with any illegal activity.
 
Section 4.29                     Construction Expenses
 
All costs and expenses of any and all labor, materials, supplies and equipment
used in the construction maintenance or repair of the Improvements have been
paid in full.  To Borrower’s knowledge after due inquiry, there are no claims
for payment for work, labor or materials affecting the Property which are or may
become a lien prior to, or of equal priority with, the Liens created by the Loan
Documents.
 
Section 4.30                     Personal Property
 
Borrower has paid in full for, and is the owner of, all Personal Property (other
than tenants’ property) used in connection with the operation of the Property,
free and clear of any and all security interests, liens or encumbrances, except
for Permitted Encumbrances and the Lien and security interest created by the
Loan Documents.
 
Section 4.31                     Taxes
 
Borrower and Borrower Principal have filed all federal, state, county,
municipal, and city income, personal property and other tax returns required to
have been filed by them and have paid all taxes and related liabilities which
have become due pursuant to such returns or pursuant to any assessments received
by them. Neither Borrower nor Borrower Principal knows of any basis for any
additional assessment in respect of any such taxes and related liabilities for
prior years.
 
Section 4.32                     Title
 
Borrower has good, marketable and insurable fee simple title to the real
property comprising part of the Property and good title to the balance of the
Property, free and clear of all Liens whatsoever except the Permitted
Encumbrances.  None of the Permitted Encumbrances, individually or in the
aggregate, materially interferes with the benefits of the security intended to
be provided by the Loan Documents, materially and adversely affects the value of
the Property, impairs the use or the operation of the Property or impairs
Borrower’s ability to pay its obligations in a timely manner.  The Mortgage,
when properly recorded in the appropriate records, together with any Uniform
Commercial Code financing statements required to be filed in connection
therewith, will create (a) a valid, perfected first priority lien on the
Property, subject only to Permitted Encumbrances and (b) perfected security
interests in and to, and perfected collateral assignments of, all personalty
(including the Leases), all in accordance with the terms hereof, in each case
subject only to Permitted Encumbrances.  There are no claims for payment for
work, labor or materials affecting the Property which are or may become a Lien
prior to, or of equal priority with, the Liens created by the Loan Documents.
 
 
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Section 4.33                      Federal Reserve Regulations
 
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 or prohibited by
the terms and conditions of this Agreement or the other Loan Documents.
 
Section 4.34                      Investment Company Act
 
Borrower is not (a) an “investment company” or a company “controlled” by an
“investment company,” within the meaning of the Investment Company Act of 1940,
as amended; (b) a “holding company” or a “subsidiary company” of a “holding
company” or an “affiliate” of either a “holding company” or a “subsidiary
company” within the meaning of the Public Utility Holding Company Act of 1935,
as amended; or (c) subject to any other federal or state law or regulation which
purports to restrict or regulate its ability to borrow money.
 
Section 4.35                      Reciprocal Easement Agreements
 
(a)           Neither Borrower, nor any other party is currently in default (nor
has any notice been given or received with respect to an alleged or current
default) under any of the terms and conditions of the REA, and the REA remains
unmodified and in full force and effect;
 
(b)           All easements granted pursuant to the REA which were to have
survived the site preparation and completion of construction (to the extent that
the same has been completed), remain in full force and effect and have not been
released, terminated, extinguished or discharged by agreement or otherwise;
 
(c)           All sums due and owing by Borrower to the other parties to the REA
(or by the other parties to the REA to Borrower) pursuant to the terms of the
REA, including without limitation, all sums, charges, fees, assessments, costs,
and expenses in connection with any taxes, site preparation and construction,
non-shareholder contributions, and common area and other property management
activities have been paid, are current, and no lien has attached on the Property
(or threat thereof been made) for failure to pay any of the foregoing;
 
(d)           The terms, conditions, covenants, uses and restrictions contained
in the REA do not conflict in any manner with any terms, conditions, covenants,
uses and restrictions contained in any Lease or in any agreement between
Borrower and occupant of any peripheral parcel, including without limitation,
conditions and restrictions with respect to kiosk placement, tenant restrictions
(type, location or exclusivity), sale of certain goods or services, and/or other
use restrictions; and
 
(e)           The terms, conditions, covenants, uses and restrictions contained
in each Lease do not conflict in any manner with any terms, conditions,
covenants, uses and restrictions contained in the REA, any other Lease or in any
agreement between Borrower and occupant of any peripheral parcel, including
without limitation, conditions and restrictions with respect to kiosk placement,
tenant restrictions (type, location or exclusivity), sale of certain goods or
services, and/or other use restrictions.
 
 
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Section 4.36                      No Change in Facts or Circumstances;
Disclosure
 
All information submitted by Borrower or its agents to Lender and in all
financial statements, rent rolls, reports, certificates and other documents
submitted in connection with the Loan or in satisfaction of the terms thereof
and all statements of fact made by Borrower in this Agreement or in any other
Loan Document, are accurate, complete and correct in all material
respects.  There has been no material adverse change in any condition, fact,
circumstance or event that would make any such information inaccurate,
incomplete or otherwise misleading in any material respect or that otherwise
materially and adversely affects or might materially and adversely affect the
Property or the business operations or the financial condition of
Borrower.  Borrower has disclosed to Lender all material facts and has not
failed to disclose any material fact that could cause any representation or
warranty made herein to be materially misleading.
 
Section 4.37                      Intellectual Property
 
All trademarks, trade names and service marks necessary to the business of
Borrower as presently conducted or as Borrower contemplates conducting its
business are in good standing and, to the extent of Borrower’s actual knowledge,
uncontested.  Borrower has not infringed, is not infringing, and has not
received notice of infringement with respect to asserted trademarks, trade names
and service marks of others.  To Borrower’s knowledge, there is no infringement
by others of trademarks, trade names and service marks of Borrower.
 
Section 4.38                      Compliance with Anti-Terrorism Laws
 
None of Borrower, Borrower Principal or any Person who Controls Borrower or
Borrower Principal currently is identified by the Office of Foreign Assets
Control, Department of the Treasury (“OFAC”) or otherwise qualifies as a
Embargoed Person, and Borrower has implemented procedures to ensure that no
Person who now or hereafter owns a direct or indirect equity interest in
Borrower or Borrower Principal is an Embargoed Person or is Controlled by an
Embargoed Person. None of Borrower or Borrower Principal is in violation of any
applicable law relating to anti-money laundering or anti-terrorism, including,
without limitation, those related to transacting business with Embargoed Persons
or the requirements of the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, U.S.
Public Law 107-56, and the related regulations issued thereunder,  including
temporary regulations (collectively, as the same may be amended from time to
time, the “Patriot Act”). To the best of Borrower’s knowledge, no tenant at the
Property is currently identified by OFAC or otherwise qualifies as an Embargoed
Person, or is owned or Controlled by an Embargoed Person.  Borrower has
determined that Manager has implemented procedures approved by Borrower to
ensure that no tenant at the Property is currently  identified by OFAC or
otherwise qualifies as an Embargoed Person, or is owned or Controlled by an
Embargoed Person.
 
Section 4.39                      Patriot Act
 
Neither Borrower nor Borrower Principal shall (a) be or become subject at any
time to any law, regulation, or list of any government agency (including,
without limitation, the list maintained by OFAC and accessible through the OFAC
website) that prohibits or limits any lender from making any advance or
extension of credit to Borrower or from otherwise conducting business with
Borrower and Borrower Principal, or (b) fail to provide documentary and other
evidence of Borrower’s identity as may be requested by any lender at any time to
enable any lender to verify Borrower’s identity or to comply with any applicable
law or regulation, including, without limitation, the Patriot Act. In addition,
Borrower hereby agrees to provide to Lender any additional information that
Lender deems necessary from time to time in order to ensure compliance with all
applicable laws concerning money laundering and similar activities.
 
 
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Section 4.40                      Brokers and Financial Advisors
 
Borrower has dealt with no financial advisors, brokers, underwriters, placement
agents, agents or finders in connection with the transactions contemplated by
this Agreement other than Eastdil Secured LLC, whose fees shall be paid in full
by Borrower on or prior to the date hereof.
 
Section 4.41                      Survival
 
Borrower agrees that, unless expressly provided otherwise, all of the
representations and warranties of Borrower set forth in this Article 4 and
elsewhere in this Agreement and in the other Loan Documents shall survive for so
long as any portion of the Debt remains owing to Lender.  All representations,
warranties, covenants and agreements made in this Agreement or in the other Loan
Documents by Borrower shall be deemed to have been relied upon by Lender
notwithstanding any investigation heretofore or hereafter made by Lender or on
its behalf.
 
ARTICLE 5
BORROWER COVENANTS
 
From the date hereof and until repayment of the Debt in full and performance in
full of all obligations of Borrower under the Loan Documents or the earlier
release of the Lien of the Mortgage (and all related obligations) in accordance
with the terms of this Agreement and the other Loan Documents, Borrower hereby
covenants and agrees with Lender that:
 
Section 5.1                      Existence; Compliance with Requirements
 
(a)           Borrower shall do or cause to be done all things necessary to
preserve, renew and keep in full force and effect its existence, rights,
licenses, permits and franchises and comply with all Legal Requirements
applicable to it and the Property.  Borrower hereby covenants and agrees not to
commit, permit or suffer to exist any act or omission affording any Governmental
Authority the right of forfeiture as against the Property or any part thereof or
any monies paid in performance of Borrower’s obligations under any of the Loan
Documents.  Borrower shall at all times maintain, preserve and protect all
franchises and trade names used in connection with the operation of the
Property.
 
(b)           After prior written notice to Lender, Borrower, at its own
expense, may contest by appropriate legal proceeding, promptly initiated and
conducted in good faith and with due diligence, the Legal Requirements affecting
the Property, provided that (i) no Default or Event of Default has occurred and
is continuing; (ii) such proceeding shall be permitted under and be conducted in
accordance with the provisions of any other instrument to which Borrower or the
Property is subject and shall not constitute a default thereunder; (iii) neither
the Property, any part thereof or interest therein, any of the tenants or
occupants thereof, nor Borrower shall be affected in any material adverse way as
a result of such proceeding; (iv) non-compliance with the Legal Requirements
shall not impose civil or criminal liability on Borrower or Lender; (v) Borrower
shall have furnished the security as may be required in the proceeding or by
Lender to ensure compliance by Borrower with the Legal Requirements; and (vi)
Borrower shall have furnished to Lender all other items reasonably requested by
Lender.
 
 
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Section 5.2                      Maintenance and Use of Property
 
Borrower shall cause the Property to be maintained in a good, safe and insurable
condition and in compliance with all applicable Legal Requirements, and shall
promptly make all repairs to the Property, above grade and below grade, interior
and exterior, structural and nonstructural, ordinary and extraordinary,
unforeseen and forseen.  All repairs made by Borrower shall be made with
first-class materials, in a good and workmanlike manner, shall be equal or
better in quality and class to the original work and shall comply with all
applicable Legal Requirements and insurance requirements.  The Improvements and
the Personal Property shall not be removed, demolished or other than in
accordance with the provisions of Section 5.21, materially altered (except for
normal replacement of the Personal Property) without the prior written consent
of Lender.  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 the nonconforming use to be discontinued or the nonconforming
Improvement to be abandoned without the express written consent of Lender.
 
Section 5.3                      Waste
 
Borrower shall not commit or suffer any waste of the Property or make any change
in the use of the Property which will in any way materially increase the risk of
fire or other hazard arising out of the operation of the Property, or take any
action that might invalidate or give cause for cancellation of any Policy, or do
or permit to be done thereon anything that may in any way impair the value of
the Property or the security for the Loan.  Borrower will not, without the prior
written consent of Lender, permit any drilling or exploration for or extraction,
removal, or production of any minerals from the surface or the subsurface of the
Property, regardless of the depth thereof or the method of mining or extraction
thereof.
 
Section 5.4                      Taxes and Other Charges
 
(a)           Borrower shall pay all Taxes and Other Charges now or hereafter
levied or assessed or imposed against the Property or any part thereof as the
same become due and payable; provided, however, Borrower’s obligation to
directly pay Taxes shall be suspended for so long as Borrower complies with the
terms and provisions of Section 9.6 hereof.  Borrower shall furnish to Lender
receipts for the payment of the Taxes and the Other Charges at least five (5)
days prior to the date the same shall become delinquent (provided, however, that
Borrower is not required to furnish such receipts for payment of Taxes in the
event that such Taxes have been paid by Lender pursuant to Section 9.6
hereof).  Borrower shall not suffer and shall promptly cause to be paid and
discharged any Lien or charge whatsoever which may be or become a Lien or charge
against the Property, and shall promptly pay for all utility services provided
to the Property.  If Borrower shall fail to pay any Taxes or Other Charges in
accordance with this Section 5.4 and is not contesting or causing a contesting
of such Taxes or Other Charges in accordance with Section 5.4(b) below, or if
there are insufficient funds in the Tax and Insurance Reserve Account to pay any
Taxes or Other Charges, Lender shall have the right, but shall not be obligated,
to pay such Taxes or Other Charges, and Borrower shall repay to Lender, on
demand, any amount paid by Lender, with interest thereon at the Default Rate
from the date of the advance thereof to the date of repayment, and such amount
shall constitute a portion of the Debt secured by the Mortgage.
 
 
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(b)           After prior written notice to Lender, Borrower, at its own
expense, may contest by appropriate legal proceeding, promptly initiated and
conducted in good faith and with due diligence, the amount or validity or
application in whole or in part of any Taxes or Other Charges, provided that (i)
no Default or Event of Default has occurred and remains uncured; (ii) such
proceeding shall be permitted under and be conducted in accordance with the
provisions of any other instrument to which Borrower is subject and shall not
constitute a default thereunder and such proceeding shall be conducted in
accordance with all applicable Legal Requirements; (iii) neither the Property
nor any part thereof or interest therein will be in danger of being sold,
forfeited, terminated, canceled or lost; (iv) Borrower shall promptly upon final
determination thereof pay the amount of any such Taxes or Other Charges,
together with all costs, interest and penalties which may be payable in
connection therewith; (v) such proceeding shall suspend the collection of such
contested Taxes or Other Charges from the Property (unless Borrower first pays
the Imposition or charge; (vi) Borrower shall furnish such security as may be
required in the proceeding, or deliver to Lender such reserve deposits as may be
requested by Lender, to insure the payment of any such Taxes or Other Charges,
together with all interest and penalties thereon (unless Borrower has paid all
of the Taxes or Other Charges under protest); (vii) failure to pay such Taxes or
Other Charges will not subject Lender to any civil or criminal liability; (viii)
such contest shall not affect the ownership, use or occupancy of the Property;
and (ix) Borrower shall, upon request by Lender, give Lender prompt notice of
the status of such proceedings and/or confirmation of the continuing
satisfaction of the conditions set forth in clauses (i) –(viii) of this Section
5.4(b).  Lender may pay over any such cash deposit or part thereof held by
Lender to the claimant entitled thereto at any time when, in the judgment of
Lender, the entitlement of such claimant is established or the Property (or part
thereof or interest therein) shall be in danger of being sold, forfeited,
terminated, canceled or lost or there shall be any danger of the Lien of the
Mortgage being primed by any related Lien.
 
Section 5.5                      Litigation
 
Borrower shall give prompt written notice to Lender of any litigation or
governmental proceedings pending or threatened in writing against any of
Borrower, Borrower Principal or the Property which might materially adversely
affect either Borrower’s or Borrower Principal’s condition (financial or
otherwise) or business or the Property.
 
Section 5.6                      Access to Property
 
Subject to the rights of Tenants under Leases, Borrower shall permit agents,
representatives and employees of Lender to inspect the Property or any part
thereof at reasonable hours upon reasonable advance notice.
 
 
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Section 5.7                      Notice of Default
 
Borrower shall promptly advise Lender of any material adverse change in the
condition (financial or otherwise) of Borrower, any Borrower Principal or the
Property or of the occurrence of any Default or Event of Default of which
Borrower has knowledge.
 
Section 5.8                      Cooperate in Legal Proceedings
 
Borrower shall at Borrower’s expense cooperate fully with Lender with respect to
any proceedings before any court, board or other Governmental Authority which
may in any way affect the rights of Lender hereunder or any rights obtained by
Lender under any of the other Loan Documents and, in connection therewith,
permit Lender, at its election, to participate in any such proceedings.
 
Section 5.9                      Performance by Borrower
 
Borrower shall in a timely manner observe, perform and fulfill each and every
covenant, term and provision to be observed and performed by Borrower under this
Agreement and the other Loan Documents and any other agreement or instrument
affecting or pertaining to the Property and any amendments, modifications or
changes thereto.
 
Section 5.10                    Awards; Insurance Proceeds
 
Borrower shall cooperate with Lender in obtaining for Lender the benefits of any
Awards or Insurance Proceeds lawfully or equitably payable in connection with
the Property, and Lender shall be reimbursed for any expenses incurred in
connection therewith (including reasonable, actual attorneys’ fees and
disbursements, and the payment by Borrower of the expense of an appraisal on
behalf of Lender in case of a Casualty or Condemnation affecting the Property or
any part thereof) out of such Awards or Insurance Proceeds.
 
Section 5.11                    Financial Reporting
 
(a)           Borrower and Borrower Principal shall keep adequate books and
records of account in accordance with GAAP (or such other method of accounting
acceptable to Lender), consistently applied and shall furnish to Lender:
 
(i)            a Rent Roll, prepared and certified by Borrower monthly in the
form attached hereto as Exhibit C, within thirty (30) days after the end of each
calendar month;
 
(ii)           monthly and year-to-date operating statements of the Property,
prepared and certified by Borrower in the form attached hereto as Exhibit D,
within thirty (30) days after the end of each calendar month;
 
(iii)          annual balance sheets, profit and loss statements, statements of
cash flows, and statements of change in financial position of Borrower and
Borrower Principal in the form required by Lender, prepared and certified by
Borrower and Borrower Principal (or if required by Lender, annual audited
financial statements prepared by an Acceptable Accountant), within ninety (90)
days after the close of each fiscal year of Borrower and Borrower Principal, as
the case may be;
 
 
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(iv)           an Annual Budget not later than thirty (30) days prior to the
commencement of each fiscal year of Borrower in form reasonably satisfactory to
Lender.  Only during a Cash Sweep Period, in the event that Lender objects to a
proposed Annual Budget submitted by Borrower, Lender shall advise Borrower of
such objections within fifteen (15) days after receipt thereof (and deliver to
Borrower a reasonably detailed description of such objections) and Borrower
shall promptly revise such Annual Budget and resubmit the same to
Lender.  Lender shall advise Borrower of any objections to such revised Annual
Budget within ten (10) days after receipt thereof (and deliver to Borrower a
reasonably detailed description of such objections) and Borrower shall promptly
revise the same in accordance with the process described in this subsection
until Lender approves the Annual Budget.  Only during a Cash Sweep Period, until
such time that Lender approves a proposed Annual Budget, which approval shall
not be unreasonably withheld, conditioned or delayed, the most recent Annual
Budget shall apply; provided that, such approved Annual Budget shall be adjusted
to reflect actual increases in Taxes, Insurance Premiums, utilities expenses and
expenses under the Management Agreement; and
 
(v)            a monthly calculation of the Debt Service Coverage Ratio for the
immediately preceding twelve (12) month period as of the last day of such month,
prepared and certified by Borrower in the form required by Lender.
 
(b)           Upon request from Lender during a Cash Sweep Period or in
connection with a Securitization, Borrower shall promptly furnish to Lender:
 
(i)            a property management report for the Property, showing the number
of inquiries made and/or rental applications received from tenants or
prospective tenants and deposits received from tenants and any other information
requested by Lender, in reasonable detail and certified by Borrower to be true
and complete, but no more frequently than quarterly;
 
(ii)           an accounting of all security deposits held in connection with
any Lease of any part of the Property, including the name and account number of
the accounts in which such security deposits are held, the name and address of
the financial institutions in which such security deposits are held and the name
of the Person to contact at such financial institution, along with any authority
or release necessary for Lender to obtain information regarding such accounts
directly from such financial institutions; and
 
(iii)           a report of all letters of credit provided by any Tenant in
connection with any Lease of any part of the Property, including the account
numbers of such letters of credit, the names and addresses of the financial
institutions that issued such letters of credit and the names of the Persons to
contact at such financial institutions, along with any authority or release
necessary for Lender to obtain information regarding such letters of credit
directly from such financial institutions.
 
 
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(c)           Borrower and Borrower Principal shall furnish Lender with such
other additional financial or management information (including state and
federal tax returns) as may, from time to time, be reasonably required by Lender
in form and substance reasonably satisfactory to Lender (including, without
limitation, any financial reports required to be delivered by any Tenant or any
guarantor of any Lease pursuant to the terms of such Lease or otherwise in
Borrower’s possession), and shall furnish to Lender and its agents convenient
facilities for the examination and audit of any such books and records.
 
(d)           All items requiring the certification of Borrower shall, except
where Borrower is an individual, require a certificate executed by an authorized
officer of Borrower or the general partner or managing member of Borrower, as
applicable, and shall contain a statement by Borrower as to whether there
exists, to Borrower’s knowledge, an Event of Default under the Loan Documents,
and if an Event of Default exists, the nature thereof, the period of time it has
existed and the action then being taken to remedy the same.
 
(e)           Without limiting any other rights available to Lender under this
Loan Agreement or any of the other Loan Documents, in the event Borrower shall
fail to timely furnish Lender any financial document or statement in accordance
with this Section 5.11 within ten (10) days of Lender’s written request
therefor, Borrower shall promptly pay to Lender a non-refundable charge in the
amount of $1,000 for each such failure.  The payment of such amount shall not be
construed to relieve Borrower of any Event of Default hereunder arising from
such failure.
 
Section 5.12                      Estoppel Statement
 
(a)           After request by Lender, Borrower shall within ten (10) Business
Days furnish Lender with a statement, duly acknowledged and certified, setting
forth (i) the amount of the original principal amount of the Note, (ii) the rate
of interest on the Note, (iii) the unpaid principal amount of the Note, (iv) the
date installments of interest and/or principal were last paid, (v) the Maturity
Date, (vi) any known offsets or defenses to the payment of the Debt, if any, and
(vii) that the Note, this Agreement, the Mortgage and the other Loan Documents
are valid, legal and binding obligations and have not been modified or if
modified, giving particulars of such modification.
 
(b)           Borrower shall use its commercially reasonable efforts to deliver
to Lender, consistent with the terms of the Leases, promptly upon request, duly
executed estoppel certificates from any one or more Tenants as required by
Lender attesting to such facts regarding the related Lease as Lender may
require, including, but not limited to attestations that each Lease covered
thereby is in full force and effect with no defaults thereunder on the part of
any party, that none of the Rents have been paid more than one month in advance,
except as security, and that the Tenant claims no defense or offset against the
full and timely performance of its obligations under the Lease; provided,
however, other than in connection with a Securitization, Borrower shall not be
obligated to request tenant estoppel certificates more than once in any eighteen
(18) month period.
 
Section 5.13                      Leasing Matters
 
(a)           Borrower may enter into a proposed Lease (including the renewal or
extension of an existing Lease (a “Renewal Lease”)) without the prior written
consent of Lender, provided such proposed Lease or Renewal Lease (i) provides
for rental rates and terms comparable to existing local market rates and terms
(taking into account the type and quality of the tenant) as of the date such
Lease is executed by Borrower (unless, in the case of a Renewal Lease, the rent
payable during such renewal, or a formula or other method to compute such rent,
is provided for in the original Lease), (ii) is an arm’s-length transaction with
a bona fide, independent third party tenant, (iii) does not have a materially
adverse effect on the value of the Property taken as a whole, (iv) is subject
and subordinate to the Mortgage and requires the Tenant thereunder to attorn to
Lender, (v) does not contain any option, offer, right of first refusal, right of
first offer or other similar right to acquire all or any portion of the
Property, (vi) has no rent, credits, free rents or concessions granted
thereunder other than those which are reasonable and customary and comparable to
existing local market terms, (vii) other than with respect to a Short Term
Lease, is written on the standard form of lease approved by Lender with such
reasonable and customary modifications as would not have a material and adverse
affect on the value of the Property, and (viii) is not a Major Lease.  All
proposed Leases which do not satisfy the requirements set forth in this
subsection shall be subject to the prior approval of Lender and its counsel, at
Borrower’s expense (not to exceed $5,000).  Borrower shall promptly deliver to
Lender copies of all Leases which are entered into pursuant to this subsection
together with Borrower’s certification that it has satisfied all of the
conditions of this Section.
 
 
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(b)           Borrower (i) shall observe and perform all the obligations imposed
upon the landlord under the Leases and shall not do or permit to be done
anything to impair the value of any of the Leases as security for the Debt; (ii)
shall promptly send copies to Lender of all notices of default which Borrower
shall send pursuant to a Major Lease or Borrower shall receive pursuant to a
Major Lease; (iii) shall enforce all of the material terms, covenants and
conditions contained in the Leases (other than the Short Term Leases) upon the
part of the tenant thereunder to be observed or performed; (iv) shall not
collect any of the Rents more than one (1) month in advance (except security
deposits shall not be deemed Rents collected in advance); (v) except as
expressly permitted pursuant to Article 7 hereof, shall not execute any other
assignment of the landlord’s interest in any of the Leases or the Rents; and
(vi) except as expressly permitted pursuant to Article 7 hereof, shall not
consent to any assignment of or subletting under any Leases not in accordance
with their terms if such assignment or sublet could have a material adverse
effect on the Property or the current and/or intended operation thereof, without
the prior written consent of Lender.
 
(c)           Borrower may, without the prior written consent of Lender, amend,
modify or waive the provisions of any Lease or terminate, reduce Rents under,
accept a surrender of space under, or shorten the term of, any Lease (including
any guaranty, letter of credit or other credit support with respect thereto)
provided that (i) such action (taking into account, in the case of a
termination, reduction in rent, surrender of space or shortening of term, the
planned alternative use of the affected space) does not have a materially
adverse effect on the value of the Property taken as a whole, (ii) such action
is in the normal course of business and in a manner which is consistent with
sound and customary leasing and management practices for similar properties in
the community in which the Property is located, and (iii) such Lease, as
amended, modified or waived, is otherwise in compliance with the requirements of
this Agreement and any subordination agreement binding upon Lender with respect
to such Lease.  A termination of a Lease with a tenant who is in default beyond
applicable notice and grace periods shall not be considered an action which has
a materially adverse effect on the value of the Property taken as a whole.  Any
amendment, modification, waiver, termination, rent reduction, space surrender or
term shortening which does not satisfy the requirements set forth in this
subsection shall be subject to the prior written approval of Lender (not to be
unreasonably withheld, conditioned or delayed), at Borrower’s expense.  Borrower
shall promptly deliver to Lender copies of amendments, modifications and waivers
of any Major Lease which are entered into pursuant to this subsection together
with Borrower’s certification that it has satisfied all of the conditions of
this subsection.
 
 
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(d)           Notwithstanding anything contained herein to the contrary,
Borrower shall not, without the prior written consent of Lender, enter into,
renew, extend, amend, modify, waive any provisions of, terminate, reduce Rents
under, accept a surrender of space under, or shorten the term of any Major
Lease.
 
(e)           Notwithstanding anything contained herein to the contrary,
Borrower shall not, without the prior written consent of Lender, enter into,
renew, extend, amend, modify, waive any provisions of, terminate, reduce Rents
under, accept a surrender of space under, or shorten the term of any Lease
(other than a Short Term Lease) during a Cash Sweep Period.
 
(f)           Notwithstanding the provisions of Section 5.13, to the extent that
Lender’s prior written consent or approval is required pursuant to this Section
5.13, Borrower may, at Borrower’s option, submit to Lender a summary of the
economic and other material terms of the proposed transaction (together with the
current draft of the documents memorializing the terms contemplated in such term
sheet).  Such summary shall include, among other things, the lease term, rental
rate, capital expenditures (lease commissions and tenant improvements, if any),
other concessions (free rent, moving allowance, etc.), and lease options
(termination, renewal, contraction and expansion, including the financial terms,
if any, associated with such lease options), if any, for the proposed
transaction.  The summary of economic terms shall be deemed approved by Lender
if Lender shall have failed to notify Borrower of its approval or disapproval
within ten (10) Business Days after such submission; provided, however, all such
request to Lender must be marked in bold lettering with the following language:
“LENDER’S RESPONSE IS REQUIRED WITHIN A SPECIFIED TIME FRAME OF RECEIPT OF THIS
NOTICE PURSUANT TO THE TERMS OF A LOAN AGREEMENT BETWEEN THE UNDERSIGNED AND
LENDER” and, unless sent via overnight carrier, the envelope containing the
request must be marked “PRIORITY”. If (i) Borrower has not submitted such a
summary to Lender for approval or (ii) if the actual terms of the proposed Lease
differ from the Lender approved summary of economic and other material terms,
Borrower shall submit the Lease (or amendment or modification thereto) to Lender
for its approval which shall be deemed approved by Lender if Lender shall have
failed to notify Borrower of its approval or disapproval within ten (10)
Business Days after such submission; provided, however, all such request to
Lender must be marked in bold lettering with the following language: “LENDER’S
RESPONSE IS REQUIRED WITHIN A SPECIFIED TIME FRAME OF RECEIPT OF THIS NOTICE
PURSUANT TO THE TERMS OF A LOAN AGREEMENT BETWEEN THE UNDERSIGNED AND LENDER”
and, unless sent via overnight carrier, the envelope containing the request must
be marked “PRIORITY”.
 
Section 5.14                      Property Management
 
(a)           Borrower shall (i) promptly perform and observe all of the
covenants required to be performed and observed by it under the Management
Agreement and do all things necessary to preserve and to keep unimpaired its
material rights thereunder; (ii) promptly notify Lender of any default under the
Management Agreement of which it is aware; (iii) promptly deliver to Lender a
copy of any notice of default or other material notice received by Borrower
under the Management Agreement; (iv) promptly give notice to Lender of any
notice or information that Borrower receives which indicates that Manager is
terminating the Management Agreement or that Manager is otherwise discontinuing
its management of the Property; and (v) promptly enforce the performance and
observance of all of the covenants required to be performed and observed by
Manager under the Management Agreement.
 
 
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(b)           If at any time, (i) Manager shall become insolvent or a debtor in
a bankruptcy proceeding; (ii) an Event of Default has occurred and is
continuing; (iii) a default has occurred and is continuing under the Management
Agreement, or (iv) Manager has engaged in gross negligence, fraud, willful
misconduct or misappropriation of funds as determined by Lender and described in
a written notice to Borrower, and as to any item of either gross negligence or
willful misconduct, Borrower has not cured same within ten (10) Business Days of
receipt of such notice,  Borrower shall, at the request of Lender, terminate the
Management Agreement upon thirty (30) days prior notice to Manager and replace
Manager with a Qualified Manager reasonably approved by Lender on terms and
conditions reasonably satisfactory to Lender, it being understood and agreed
that the management fee for such replacement Manager shall not exceed then
prevailing market rates.
 
(c)           Borrower shall not, without the prior written consent of Lender
(which consent shall not be unreasonably withheld, conditioned or delayed): (i)
surrender, terminate or cancel the Management Agreement or otherwise replace
Manager or enter into any other management agreement with respect to the
Property; (ii) reduce or consent to the reduction of the term 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.  In the event that
Borrower replaces Manager at any time during the term of Loan pursuant to this
subsection, such Manager shall be a Qualified Manager.
 
(d)           In connection with any Sale or Pledge as permitted by the terms of
Article 7 of this Agreement, Borrower shall have the right, without payment of
any fee other than payment of Lender’s reasonable and customary out-of-pocket
costs and expenses, to terminate the Management Agreement upon thirty (30) days
prior notice to Manager and replace Manager with a Qualified Manager operating
pursuant to a Replacement Management Agreement reasonably approved by Lender on
terms and conditions reasonably satisfactory to Lender, it being understood and
agreed that the management fee for such replacement Manager shall not exceed the
then prevailing market rate.
 
Section 5.15                      Liens
 
Subject to Borrower’s right to contest same pursuant to the terms of the
Mortgage, Borrower shall not, without the prior written consent of Lender,
create, incur, assume or suffer to exist any Lien on any portion of the Property
or permit any such action to be taken, except Permitted Encumbrances.
 
 
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Section 5.16                      Debt Cancellation
 
Borrower shall not cancel or otherwise forgive or release any claim or debt
(other than termination of Leases in accordance herewith) owed to Borrower by
any Person, except for adequate consideration and in the ordinary course of
Borrower’s business.
 
Section 5.17                      Zoning
 
Borrower shall not (i) initiate or consent to any zoning reclassification of any
portion of the Property or seek any variance under any existing zoning ordinance
or (ii) use or permit the use of any portion of the Property in any manner that
could result in such use becoming a non-conforming use under any zoning
ordinance or any other applicable land use law, rule or regulation, in each case
without the prior written consent of Lender.
 
Section 5.18                      ERISA
 
(a)           Borrower shall not engage in any transaction which would cause any
obligation, or action taken or to be taken, hereunder (or the exercise by Lender
of any of its rights under the Note, this Agreement or the other Loan Documents)
to be a non-exempt (under a statutory or administrative class exemption)
prohibited transaction under ERISA.
 
(b)           Borrower further covenants and agrees to deliver to Lender such
certifications or other evidence from time to time throughout the term of the
Loan, as requested by Lender in its sole discretion, that (i) Borrower is not
and does not maintain an “employee benefit plan” as defined in Section 3(3) of
ERISA, which is subject to Title I of ERISA, or a “governmental plan” within the
meaning of Section 3(3) of ERISA; (ii) Borrower is not subject to state statutes
regulating investments and fiduciary obligations with respect to governmental
plans; and (iii) one or more of the following circumstances is true:
 
(i)             Equity interests in Borrower are publicly offered securities,
within the meaning of 29 C.F.R. §2510.3-101(b)(2);
 
(ii)            Less than twenty-five percent (25%) of each outstanding class of
equity interests in Borrower are held by “benefit plan investors” within the
meaning of 29 C.F.R. §2510.3-101(f)(2); or
 
(iii)           Borrower qualifies as an “operating company” or a “real estate
operating company” within the meaning of 29 C.F.R. §2510.3-101(c) or (e).
 
Section 5.19                      No Joint Assessment
 
Borrower shall not suffer, permit or initiate the joint assessment of the
Property with (a) any other real property constituting a tax lot separate from
the Property, or (b) 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.
 
 
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Section 5.20                      Reciprocal Easement Agreements
 
Borrower shall not enter into, terminate or modify any REA without Lender’s
prior written consent, which consent shall not be unreasonably withheld,
conditioned or delayed.  Borrower shall enforce, comply with, and cause each of
the parties to the REA to comply with all of the material economic terms and
conditions contained in the REA.
 
Section 5.21                      Alterations
 
Lender’s prior written approval shall be required in connection with any
alterations to any Improvements, exclusive of alterations to tenant spaces
required under any Lease, (a) that may have a material adverse effect on the
Property, (b) that are structural in nature or have an adverse affect on any
utility or HVAC system contained in the Improvements or the exterior of any
building constituting a part of any Improvements or (c) that, together with any
other alterations undertaken at the same time (including any related
alterations, improvements or replacements), are reasonably anticipated to have a
cost in excess of the Alteration Threshold.  If the total unpaid amounts
incurred and to be incurred with respect to such alterations to the Improvements
shall at any time exceed the Alteration Threshold, Borrower shall deposit into
the Replacement Reserve Account that is established pursuant to the requirements
of Section 9.2(b) below, in cash or a Letter of Credit in an amount equal to the
difference between the projected amount for the cost of such alterations to the
Improvements and the Alteration Threshold.
 
ARTICLE 6
ENTITY COVENANTS
 
Section 6.1                      Single Purpose Entity/Separateness
 
Until the Debt has been paid in full, Borrower represents, warrants and
covenants as follows:
 
(a)           Borrower has not and will not:
 
(i)            engage in any business or activity other than the ownership,
operation and maintenance of the Property, and activities incidental thereto;
 
(ii)           acquire or own any assets other than (A) the Property, and (B)
such incidental Personal Property as may be necessary for the operation of the
Property;
 
(iii)          merge into or consolidate with any Person, or dissolve,
terminate, liquidate in whole or in part, transfer or otherwise dispose of all
or substantially all of its assets or change its legal structure;
 
(iv)          fail to observe all organizational formalities, or fail to
preserve its existence as an entity duly organized, validly existing and in good
standing (if applicable) under the applicable Legal Requirements of the
jurisdiction of its organization or formation, or amend, modify, terminate or
fail to comply with the provisions of its organizational documents;
 
 
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(v)           own any subsidiary, or make any investment in, any Person;
 
(vi)          commingle its assets with the assets of any other Person, or
permit any Affiliate or constituent party independent access to its bank
accounts;
 
(vii)         incur any debt, secured or unsecured, direct or contingent
(including guaranteeing any obligation), other than (A) the Debt, (B) trade and
operational indebtedness incurred in the ordinary course of business with trade
creditors, provided such indebtedness is (1) unsecured, (2) not evidenced by a
note, (3) on commercially reasonable terms and conditions, and (4) due not more
than sixty (60) days past the date incurred and paid on or prior to such date,
and/or (C) financing leases and purchase money indebtedness incurred in the
ordinary course of business relating to Personal Property on commercially
reasonable terms and conditions; provided, however, the aggregate amount of the
indebtedness described in (B) and (C) shall not exceed at any time two percent
(2%) of the outstanding principal amount of the Note;
 
(viii)         fail to maintain its records, books of account, bank accounts,
financial statements, accounting records and other entity documents separate and
apart from those of any other Person; except that Borrower’s financial position,
assets, liabilities, net worth and operating results may be included in the
consolidated financial statements of an Affiliate, provided that (A) appropriate
notation shall be made on such consolidated financial statements to indicate the
separate identity of Borrower from such Affiliate and that Borrower’s assets and
credit are not available to satisfy the debts and other obligations of such
Affiliate or any other Person, and (B) Borrower’s assets, liabilities and net
worth shall also be listed on Borrower’s own separate balance sheet;
 
(ix)           enter into any contract or agreement with any general partner,
member, shareholder, principal, guarantor of the obligations of Borrower, or any
Affiliate of the foregoing, except upon terms and conditions that are
intrinsically fair, commercially reasonable and substantially similar to those
that would be available on an arm’s-length basis with unaffiliated third
parties;
 
(x)            maintain its assets in such a manner that it will be costly or
difficult to segregate, ascertain or identify its individual assets from those
of any other Person;
 
(xi)           except as contemplated by the Loan Documents, assume or guaranty
the debts of any other Person, hold itself out to be responsible for the debts
of any other Person, or otherwise pledge its assets to secure the obligations of
any other Person or hold out its credit as being available to satisfy the
obligations of any other Person;
 
(xii)           make any loans or advances to any Person;
 
(xiii)          fail to (A) file its own tax returns separate from those of any
other Person, except to the extent that Borrower is treated as a “disregarded
entity” for tax purposes and is not required to file tax returns under
applicable Legal Requirements, and (B) pay any taxes required to be paid under
applicable Legal Requirements;
 
(xiv)         fail either to hold itself out to the public as a legal entity
separate and distinct from any other Person or to conduct its business solely in
its own name or fail to correct any known misunderstanding regarding its
separate identity;
 
 
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(xv)            fail to maintain adequate capital for the normal obligations
reasonably foreseeable in a business of its size and character and in light of
its contemplated business operations;
 
(xvi)           if it is a partnership or limited liability company, without the
unanimous written consent of all of its partners or members, as applicable, and
the written consent of 100% of the managers of Borrower, including, without
limitation, each Independent Director, take any Material Action or action that
might cause such entity to become insolvent;
 
(xvii)           fail to allocate shared expenses (including, without
limitation, shared office space and services performed by an employee of an
Affiliate) among the Persons sharing such expenses and to use separate
stationery, invoices and checks;
 
(xviii)          fail to remain solvent or pay its own liabilities (including,
without limitation, salaries of its own employees) only from its own funds;
 
(xix)            acquire obligations or securities of its partners, members,
shareholders or other affiliates, as applicable;
 
(xx)             violate or cause to be violated the assumptions made with
respect to Borrower and its principals in any opinion letter pertaining to
substantive consolidation delivered to Lender in connection with the Loan; or
 
    (xxi)            fail to maintain a sufficient number of employees in light
of its contemplated business operations.
 
(b)           If Borrower is a partnership or limited liability company, each
general partner in the case of a partnership, or the managing member in the case
of a limited liability company (each an “SPE Component Entity”) of Borrower, as
applicable, shall be a corporation or a limited liability company whose sole
asset is its interest in Borrower, provided that if such SPE Component Entity is
a limited liability company, each of its managing members shall also be a SPE
Component Entity.  Each SPE Component Entity (i) will at all times comply with
each of the covenants, terms and provisions contained in Section 6.1(a)(iii) -
(vi) and (viii) - (xxi), as if such representation, warranty or covenant was
made directly by such SPE Component Entity; (ii) will not engage in any business
or activity other than owning an interest in Borrower; (iii) will not acquire or
own any assets other than its partnership, membership, or other equity interest
in Borrower; (iv) will not incur any debt, secured or unsecured, direct or
contingent (including guaranteeing any obligation); and (v) will cause Borrower
to comply with the provisions of this Section 6.1 and Section 6.4.  Prior to the
withdrawal or the disassociation of any SPE Component Entity from Borrower,
Borrower shall immediately appoint a new general partner or managing member
whose articles of incorporation or organization, as applicable, are
substantially similar to those of such SPE Component Entity and deliver a new
opinion letter pertaining to substantive consolidation acceptable to Lender and
the Rating Agencies with respect to the new SPE Component Entity and its equity
owners.  Notwithstanding the foregoing, to the extent Borrower is a single
member Delaware limited liability company, so long as Borrower maintains such
formation status and complies with the requirements set forth in subsections (c)
and (d) below, no SPE Component Entity shall be required.
 
 
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(c)           In the event Borrower is a single-member Delaware limited
liability company, the limited liability company agreement of Borrower (the “LLC
Agreement”) shall provide that (i) upon the occurrence of any event that causes
the sole member of Borrower (“Member”) to cease to be the member of Borrower
(other than (A) upon an assignment by Member of all of its limited liability
company interest in Borrower and the admission of the transferee in accordance
with the Loan Documents and the LLC Agreement, or (B) the resignation of Member
and the admission of an additional member of Borrower, in either case in
accordance with the terms of the Loan Documents and the LLC Agreement), any
person acting as Independent Director of Borrower (“Special Member”) shall,
without any action of any other Person and simultaneously with the Member
ceasing to be the member of Borrower, automatically be admitted to Borrower and
shall continue Borrower without dissolution and (ii) Special Member may not
resign from Borrower or transfer its rights as Special Member unless (A) a
successor Special Member has been admitted to Borrower as Special Member in
accordance with requirements of Delaware law and (B) such successor Special
Member has also accepted its appointment as an Independent Director.  The LLC
Agreement shall further provide that (i) Special Member shall automatically
cease to be a member of Borrower upon the admission to Borrower of a substitute
Member, (ii) Special Member shall be a member of Borrower that has no interest
in the profits, losses and capital of Borrower and has no right to receive any
distributions of Borrower assets, (iii) pursuant to Section 18-301 of the
Delaware Limited Liability Company Act (the “Act”), Special Member shall not be
required to make any capital contributions to Borrower and shall not receive a
limited liability company interest in Borrower, (iv) Special Member, in its
capacity as Special Member, may not bind Borrower, and (v) except as required by
any mandatory provision of the Act, Special Member, in its capacity as Special
Member, shall have no right to vote on, approve or otherwise consent to any
action by, or matter relating to, Borrower, including, without limitation, the
merger, consolidation or conversion of Borrower; provided, however, such
prohibition shall not limit the obligations of Special Member, in its capacity
as Independent Director, to vote on such matters required by the Loan Documents
or the LLC Agreement.  In order to implement the admission to Borrower of
Special Member, Special Member shall execute a counterpart to the LLC
Agreement.  Prior to its admission to Borrower as Special Member, Special Member
shall not be a member of Borrower.
 
(d)           In the event Borrower is a single-member Delaware limited
liability company, the LLC Agreement shall provide that upon the occurrence of
any event that causes the Member to cease to be a member of Borrower, to the
fullest extent permitted by law, the personal representative of Member shall,
within ninety (90) days after the occurrence of the event that terminated the
continued membership of Member in Borrower, agree in writing (i) to continue
Borrower and (ii) to the admission of the personal representative or its nominee
or designee, as the case may be, as a substitute member of Borrower, effective
as of the occurrence of the event that terminated the continued membership of
Member of Borrower in Borrower.  Any action initiated by or brought against
Member or Special Member under any Creditors Rights Laws shall not cause Member
or Special Member to cease to be a member of Borrower and upon the occurrence of
such an event, the business of Borrower shall continue without dissolution.  The
LLC Agreement shall provide that each of Member and Special Member waives any
right it might have to agree in writing to dissolve Borrower upon the occurrence
of any action initiated by or brought against Member or Special Member under any
Creditors Rights Laws, or the occurrence of an event that causes Member or
Special Member to cease to be a member of Borrower.
 
 
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(e)           The organizational documents of Borrower and each SPE Component
Entity shall provide an express acknowledgment that Lender is an intended
third-party beneficiary of the “special purpose” provisions of such
organizational documents.
 
Section 6.2                      Change of Name, Identity or Structure
 
Borrower shall not change or permit to be changed (a) Borrower’s name, (b)
Borrower’s identity (including its trade name or names), (c) Borrower’s
principal place of business set forth on the first page of this Agreement, (d)
other than as expressly permitted pursuant to Article 7 hereof, the corporate,
partnership or other organizational structure of Borrower, each SPE Component
Entity (if any), or Borrower Principal, (e) Borrower’s state of organization, or
(f) Borrower’s organizational identification number, without in each case
notifying Lender of such change in writing at least thirty (30) days prior to
the effective date of such change and, other than as expressly permitted
pursuant to Article 7 hereof, in the case of a change in Borrower’s structure,
without first obtaining the prior written consent of Lender.  In addition,
Borrower shall not change or permit to be changed any organizational documents
of Borrower or any SPE Component Entity (if any) if such change would adversely
impact the covenants set forth in Section 6.1 and 6.4 hereof.  Borrower
authorizes Lender to file any financing statement or financing statement
amendment required by Lender to establish or maintain the validity, perfection
and priority of the security interest granted herein.  At the request of Lender,
Borrower shall execute a certificate in form satisfactory to Lender listing the
trade names under which Borrower intends to operate the Property, and
representing and warranting that Borrower does business under no other trade
name with respect to the Property.  If Borrower does not now have an
organizational identification number and later obtains one, or if the
organizational identification number assigned to Borrower subsequently changes,
Borrower shall promptly notify Lender of such organizational identification
number or change.
 
Section 6.3                      Business and Operations
 
Borrower will qualify to do business and will remain in good standing under the
laws of the State as and to the extent the same are required for the ownership,
maintenance, management and operation of the Property.
 
Section 6.4                      Independent Director
 
The organizational documents of Borrower shall include the following provisions:
(a) at all times there shall be, and Borrower shall cause there to be, at least
two (2) Independent Directors; (b) the board of managers of Borrower shall not
take any action which, under the terms of any certificate of incorporation,
by-laws or any voting trust agreement with respect to any common stock, requires
unanimous vote of the board of managers of Borrower unless at the time of such
action there shall be at least two members of the board of managers who are
Independent Directors; (c) Borrower shall not, without the unanimous written
consent of its board of managers including the Independent Directors, on behalf
of itself or Borrower, take any Material Action or any action that might cause
such entity to become insolvent, and when voting with respect to such matters,
the Independent Directors shall consider only the interests of Borrower,
including its creditors; and (d) no Independent Director of Borrower may be
removed or replaced unless Borrower provides Lender with not less than three (3)
Business Days’ prior written notice of (i) any proposed removal of an
Independent Director, together with a statement as to the reasons for such
removal, and (ii) the identity of the proposed replacement Independent Director,
together with a certification that such replacement satisfies the requirements
set forth in the organizational documents for an Independent Director.
 
 
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ARTICLE 7
NO SALE OR ENCUMBRANCE
 
Section 7.1                      Transfer Definitions
 
For purposes of this Article 7 an “Affiliated Manager” shall mean any managing
agent in which Borrower, Borrower Principal, any SPE Component Entity (if any)
or any affiliate of such entities has, directly or indirectly, any legal,
beneficial or economic interest; “Control” shall mean the power to direct the
management and policies of a Restricted Party, directly or indirectly, whether
through the ownership of voting securities or other beneficial interests, by
contract or otherwise; “Restricted Party” shall mean Borrower, Borrower
Principal, any SPE Component Entity (if any), any Affiliated Manager, or any
shareholder, partner, member or non-member manager, or any direct or indirect
legal or beneficial owner of Borrower, Borrower Principal, any SPE Component
Entity (if any), any Affiliated Manager or any non-member manager; and a “Sale
or Pledge” shall mean a voluntary or involuntary sale, conveyance, mortgage,
grant, bargain, encumbrance, pledge, assignment, grant of any options with
respect to, or any other transfer or disposition of (directly or indirectly,
voluntarily or involuntarily, by operation of law or otherwise, and whether or
not for consideration or of record) of a legal or beneficial interest.
 
Section 7.2                      No Sale/Encumbrance
 
(a)           Except as otherwise permitted by this Agreement, Borrower shall
not (i) cause or permit a Sale or Pledge of the Property or any part thereof or
any legal or beneficial interest therein (other than pursuant to Leases of space
in the Improvements to Tenants in accordance with the provisions of Section
5.13) or (ii) permit a Sale or Pledge of an equity interest in any Restricted
Party (in each case, a “Prohibited Transfer”), without the prior written consent
of Lender.
 
(b)           Except as otherwise expressly permitted by this Article 7, a
Prohibited Transfer shall include (i) an installment sales agreement wherein
Borrower agrees to sell the Property or any part thereof for a price to be paid
in installments; (ii) an agreement by Borrower leasing all or a substantial part
of the Property for other than actual occupancy by a space tenant thereunder or
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 Rents; (iii) if
a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge
of such corporation’s stock or the creation or issuance of new stock in one or a
series of transactions; (iv) if a Restricted Party is a limited or general
partnership or joint venture, any merger or consolidation or the change,
removal, resignation or addition of a general partner or the Sale or Pledge of
the partnership interest of any general or limited partner or any profits or
proceeds relating to such partnership interests or the creation or issuance of
new partnership interests; (v) if a Restricted Party is a limited liability
company, any merger or consolidation or the change, removal, resignation or
addition of a managing member or non-member manager (or if no managing member,
any member) or the Sale or Pledge of the membership interest of any member or
any profits or proceeds relating to such membership interest; (vi) if a
Restricted Party is a trust or nominee trust, any merger, consolidation or the
Sale or Pledge of the legal or beneficial interest in a Restricted Party or the
creation or issuance of new legal or beneficial interests; or (vii) the removal
or the resignation of Manager (including, without limitation, an Affiliated
Manager) other than in accordance with Section 5.14.
 
 
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Section 7.3                      Permitted Transfers
 
Notwithstanding the provisions of Section 7.2, each of the following Sales or
Pledges shall not be deemed to be Prohibited Transfers: (a) a transfer by devise
or descent or by operation of law upon the death of a member, partner or
shareholder of a Restricted Party, so long as following the death of such
member, partner or shareholder there is no change in Control of such Restricted
Party as a result of such transfer; (b) transfers for estate planning purposes
of an individual's interests in any Restricted Party to the spouse or any lineal
descendant of such individual, or to a trust for the benefit of any one or more
of such individual, spouse or lineal descendant, so long as following such
transfer and there is no change in Control of such Restricted Party as a result
of such transfer; (c) the Sale or Pledge, in one or a series of transactions, of
not more than forty-nine percent (49%) of the stock, limited partnership
interests or non-managing membership interests (as the case may be) in a
Restricted Party; provided, however, (i) no such transfers shall result in a
change in Control in the Restricted Party or change in control of the Property,
(ii) following any transfers, Borrower and any SPE Component Entity shall
continue to satisfy the requirements of Section 6.1 hereof and (iii) as a
condition to each such transfer, Lender shall receive not less than thirty (30)
days prior written notice of such proposed transfer; (d) a Sale or Pledge in
connection with any Mezzanine Loan entered into in accordance with the terms of
Section 7.6 hereof (and the transfer to the mezzanine lender under such
Mezzanine Loan in connection with the exercise of any rights such mezzanine
lender may have under the Mezzanine Loan); (e) a Sale or Pledge or issuance of
limited partnership interests in Borrower Principal; or (f) the sale, transfer
or issuance of stock in GRT provided (I) such stock is then listed on the New
York Stock Exchange or such other nationally recognized publicly-traded stock
exchange or (II) in connection with the privatization of GRT, provided that
after such privatization, further transfers of the shares of GRT shall be
subject to the transfer restrictions of this Article 7. Notwithstanding anything
to the contrary contained in this Section 7.3, (i) GRT must continue to own,
directly or indirectly, one hundred percent (100%) of the interests in, and
Control, the general partner of Borrower Principal and (ii) any transfer that
results in any Person and its Affiliates owning in excess of forty-nine percent
(49%) of the ownership interests in a Restricted Party shall comply with the
requirements of Section 7.4 hereof, provided, however, for the purposes of this
Subsection (ii) only, in connection with a privatization of GRT in accordance
with Section 7.3(f)(II) above, (1) Lender’s prior written consent shall not be
required and (2) Borrower shall not be required to comply with the provisions of
Section 7.4(b) below and, unless the existing Management Agreement is being
terminated in connection with such privatization, Section 7.4(e) below.
 
Section 7.4                      Lender’s Rights
 
Borrower shall have the right to request Lender to consent to a Sale or Pledge
that is a Prohibited Transfer, but Lender reserves the right to condition the
consent to a Prohibited Transfer requested hereunder upon, among other things,
(a) a modification of the terms hereof and an assumption of the Note and the
other Loan Documents as so modified by the proposed Prohibited Transfer, (b)
receipt of payment of a transfer fee equal to one percent (1%) of the
outstanding principal balance of the Loan and all of Lender’s expenses incurred
in connection with such Prohibited Transfer, (c) receipt of written confirmation
from the Rating Agencies that the Prohibited Transfer will not result in a
downgrade, withdrawal or qualification of the initial, or if higher, then
current ratings issued in connection with a Securitization, or if a
Securitization has not occurred, any ratings to be assigned in connection with a
Securitization, (d) the proposed transferee’s continued compliance with the
covenants set forth in this Agreement (including, without limitation, the
covenants in Article 6) and the other Loan Documents, (e) the appointment of a
new Manager for the Property under a new Management Agreement reasonably
satisfactory to Lender, (f) to the extent such transferee shall own twenty
percent (20%) or more of the direct or indirect ownership interests in Borrower
immediately following such transfer (provided such transferee owned less than
twenty percent (20%) of the direct or indirect ownership interests in Borrower
as of the Closing Date), delivery by Borrower, at Borrower’s sole cost and
expense, customary searches (including without limitation credit, judgment,
lien, litigation, bankruptcy, criminal and watch list) reasonably acceptable to
Lender with respect to such transferee, and (g) the satisfaction of such other
customary and commercially reasonable conditions and/or legal opinions as Lender
shall determine in its reasonable discretion to be in the interest of
Lender.  All expenses incurred by Lender shall be payable by Borrower whether or
not Lender consents to the Prohibited Transfer.  Lender shall not be required to
demonstrate any actual impairment of its security or any increased risk of
default hereunder in order to declare the Debt immediately due and payable upon
a Prohibited Transfer made without Lender’s consent. This provision shall apply
to each and every Prohibited Transfer, whether or not Lender has consented to
any previous Prohibited Transfer.  If any Sale or Pledge permitted under this
Article 7 results in any Person and its Affiliates owning in excess of
forty-nine percent (49%) of the ownership interests in a Restricted Party,
Borrower shall, prior to such transfer, and in addition to any other requirement
for Lender consent contained herein, deliver a revised opinion letter pertaining
to substantive consolidation to Lender, which opinion shall be in a customary
and commercially reasonable form, scope and substance reasonably acceptable to
Lender and the Rating Agencies.
 
 
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Section 7.5                      Assumption
 
Notwithstanding the foregoing provisions of this Article 7, other than with
respect to the period beginning sixty (60) days prior to a Securitization or
sale, transfer or assignment of the Loan and ending sixty (60) days after the
closing of such Securitization or sale, transfer or assignment of the Loan,
Lender shall not unreasonably withhold consent to a transfer of the Property in
its entirety to or the transfer of one hundred percent (100%) of the equity
interests in Borrower, and the related assumption of the Loan by, any Person (a
“Transferee”); provided, however, Lender’s consent shall not be required if the
Transferee qualifies as Qualified Transferee; provided, further, that in all
cases each of the following terms and conditions are satisfied:
 
(a)           no Default or Event of Default has occurred;
 
(b)           Borrower shall have (i) delivered written notice to Lender of the
terms of such prospective transfer not less than sixty (60) days before the date
on which such transfer is scheduled to close and, concurrently therewith, all
such information concerning the proposed Transferee as Lender shall reasonably
require and (ii) paid to Lender a non-refundable processing fee in the amount of
$25,000.  Unless the Transferee is a Qualified Transferee, Lender shall have the
right to approve or disapprove the proposed transfer based on its then current
underwriting and credit requirements for similar loans secured by similar
properties which loans are sold in the secondary market, such approval not to be
unreasonably withheld. Unless the Transferee is a Qualified Transferee, in
determining whether to give or withhold its approval of the proposed transfer,
Lender shall consider the experience and track record of Transferee and its
principals in owning and operating facilities similar to the Property, the
financial strength of Transferee and its principals, the general business
standing of Transferee and its principals and Transferee’s and its principals’
relationships and experience with contractors, vendors, tenants, lenders and
other business entities; provided, however, that, notwithstanding Lender’s
agreement to consider the foregoing factors in determining whether to give or
withhold such approval, such approval shall be given or withheld based on what
Lender determines to be commercially reasonable and, if given, may be given
subject to such conditions as Lender may deem reasonably appropriate;
 
 
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(c)           Borrower shall have paid to Lender, concurrently with the closing
of such transfer, (i) a non-refundable assumption fee in an amount equal to (1)
with respect to an assumption by a Transferee who qualifies as Qualified
Transferee, one-half of one percent (0.5 %) of the then outstanding principal
balance of the Note or (2) with respect to an assumption by a Transferee who
does not qualify as a Qualified Transferee, one percent (1.0%) of the then
outstanding principal balance of the Note, and (ii) all out-of-pocket costs and
expenses, including reasonable attorneys’ fees and Rating Agency fees, incurred
by Lender in connection with the transfer;
 
(d)           (i) Transferee shall have assumed and agreed to pay the Debt as
and when due and shall have assumed all other obligations of Borrower under the
Loan Documents subject to the provisions of Article 15 hereof and, prior to or
concurrently with the closing of such transfer, Transferee shall have executed,
without any cost or expense to Lender, such documents and agreements as Lender
shall reasonably require to evidence and effectuate said assumption and (ii) if
required by Lender, a Person affiliated with Transferee and acceptable to Lender
(a “Transferee Principal”) shall, subject to the provisions of Article 15, have
assumed the obligations of Borrower Principal under the Loan Documents with
respect to all acts and events occurring or arising after the transfer of the
Property pursuant to this Section 7.5;
 
(e)            Borrower and Transferee, without any cost to Lender, shall
furnish any information requested by Lender for the preparation of, and shall
authorize Lender to file, new financing statements and financing statement
amendments and other documents to the fullest extent permitted by applicable
law, and shall execute any additional documents reasonably requested by Lender;
 
(f)             In connection with any transfer of the Property (but not in
connection with the transfer of the entire equity interests in Borrower),
Borrower shall have delivered to Lender, without any cost or expense to Lender,
such endorsements to Lender’s Title Insurance Policy insuring that fee simple or
leasehold title to the Property, as applicable, is vested in Transferee (subject
to Permitted Encumbrances), hazard insurance endorsements or certificates and
other similar materials as Lender may deem necessary at the time of the
transfer, all in form and substance satisfactory to Lender;
 
 
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(g)            Transferee shall have furnished to Lender, if Transferee is a
corporation, partnership, limited liability company or other entity, all
appropriate papers evidencing Transferee’s organization and good standing, and
the qualification of the signers to execute the assumption of the Debt, which
papers shall include certified copies of all documents relating to the
organization and formation of Transferee and of the entities, if any, which are
partners or members of Transferee.  Transferee and, as applicable, such
constituent partners, members or shareholders of Transferee (as the case may
be), as Lender shall require, shall comply with the applicable covenants set
forth in Article 6 hereof;
 
(h)            Transferee shall assume the obligations of Borrower under any
Management Agreement or provide a new Management Agreement with a new Manager
which meets with the requirements of Section 5.14 hereof and assign to Lender as
additional security such new Management Agreement;
 
(i)             Transferee shall furnish an opinion of counsel satisfactory to
Lender and its counsel (A) that Transferee’s formation documents provide for the
matters described in subparagraph (g) above, (B) that the assumption of the Debt
has been duly authorized, executed and delivered, and that the Note, the
Mortgage, this Agreement, the assumption agreement and the other Loan Documents
are valid, binding and enforceable against Transferee in accordance with their
terms, (C) that Transferee and any entity which is a controlling stockholder,
member or general partner of Transferee, have been duly organized, and are in
existence and good standing, and (E) with respect to such other matters as
Lender may reasonably request;
 
(j)              if required by Lender, Lender shall have received confirmation
in writing from the Rating Agencies that rate the Securities to the effect that
the transfer will not result in a qualification, downgrade or withdrawal of any
rating initially assigned or to be assigned to the Securities;
 
(k)             Borrower’s obligations under the contract of sale pursuant to
which the transfer is proposed to occur shall expressly be subject to the
satisfaction of the terms and conditions of this Section 7.5; and
 
(l)              Transferee shall, prior to such transfer, deliver a substantive
non-consolidation opinion to Lender, which opinion shall be in form, scope and
substance reasonably acceptable in all respects to Lender and the Rating
Agencies.
 
A consent by Lender with respect to a transfer of the Property in its entirety
or the entire equity interests in Borrower, to, and the related assumption of
the Loan by, a Transferee pursuant to this Section 7.5 shall not be construed to
be a waiver of the right of Lender to consent to any subsequent Sale or Pledge
of the Property or the entire equity interests in Borrower.  Upon the transfer
of the Property pursuant to this Section 7.5, Borrower and Borrower Principal
(if a Transferee Principal has assumed the obligations of Borrower Principal
under the Loan Documents with respect to all acts and events occurring or
arising after the transfer of the Property pursuant to this Section 7.5) shall
be relieved of all liability under the Loan Documents for acts, events,
conditions, or circumstances occurring or arising after the date of such
transfer, except to the extent that such acts, events, conditions, or
circumstances are the proximate result of acts, events, conditions, or
circumstances that existed prior to the date of such transfer, whether or not
discovered prior or subsequent to the date of such transfer.  All out-of-pocket
costs and expenses incurred by Lender pursuant to this Section 7.5 shall be
payable by Borrower whether or not the transfer contemplated hereunder actually
occurs.
 
 
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Section 7.6                      Permitted Mezzanine Debt
 
Provided no Event of Default has occurred and is continuing, at any time after
sixty (60) months after the date hereof, and in connection with a sale of the
Property, or the transfer of one hundred percent (100%) of the equity interests
in Borrower, to an unaffiliated third party and an assumption of the Loan
pursuant to Section 7.5 hereof, the owners of the beneficial interests in
Borrower may incur indebtedness (the “Mezzanine Loan”), provided (a) Lender has
received not less than sixty (60) days prior written notice to Lender; (b) the
amount of such Mezzanine Loan shall not exceed at the time of closing of such
Mezzanine Loan, an amount which, when added to the outstanding principal balance
of the Note, results in a loan-to-value ratio not in excess of the Permitted LTV
and a minimum Debt Service Coverage Ratio of 1.25 to 1:00; (c) the Mezzanine
Loan may be secured by a pledge of the direct and/or indirect interests in
Borrower (provided, however, the pledge of SPE Component Entity’s interest in
Borrower shall not be permitted) but such Mezzanine Loan shall be subordinate to
any New Mezzanine Loan already created, or in the future created, pursuant to
Section 13.9 hereof, (d) the holder of the Mezzanine Loan shall at all times be
a Qualified Mezzanine Lender, (e) Lender shall receive written confirmation from
the Rating Agencies that the making of the Mezzanine Loan shall not, in and of
itself, result in a downgrade, qualification or withdrawal of the then current
ratings assigned to the Securities and (f) all documents and instruments
evidencing or securing the Mezzanine Loan including, without limitation, a
subordination and intercreditor agreement, shall be in form and substance
reasonably satisfactory to Lender.
 
ARTICLE 8
INSURANCE; CASUALTY; CONDEMNATION; RESTORATION
 
Section 8.1                      Insurance
 
(a)           Borrower shall obtain and maintain, or cause to be maintained, at
all times insurance for Borrower and the Property providing at least the
following coverages:
 
(i)           comprehensive “special causes of loss” form of insurance (or its
equivalent) on the Improvements and the Personal Property (A) in an amount equal
to not less than one hundred percent (100%) of the “Full Replacement Cost,”
which for purposes of this Agreement shall mean actual replacement value
(exclusive of costs of excavations, foundations, underground utilities and
footings); (B) written on a replacement cost basis and containing either an
agreed amount endorsement with respect to the Improvements and Personal Property
or a waiver of all co-insurance provisions; (C) providing for no deductible in
excess of $25,000 for all such insurance coverage; (D) at all times insuring
against at least those hazards that are commonly insured against under a
“special causes of loss” form of policy, as the same shall exist on the date
hereof, and together with any increase in the scope of coverage provided under
such form after the date hereof; and (E)  if any of the Improvements or the use
of the Property shall at any time constitute legal non-conforming structures or
uses, providing coverage for contingent liability from Operation of Building
Laws, Demolition Costs and Increased Cost of Construction Endorsements and
containing an “Ordinance or Law Coverage” or “Enforcement” endorsement.  In
addition, Borrower shall obtain: (y) if any portion of the Improvements is
currently or at any time in the future located in a “special flood hazard area”
designated by the Federal Emergency Management Agency, flood hazard insurance in
an amount equal to the maximum amount of such insurance 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, as each may be amended,
together with such “excess flood” insurance in such amount and with such
deductible as Lender may reasonably require; and (z) earthquake insurance in
amounts and in form and substance reasonably satisfactory to Lender in the event
the Property is located in an area with a high degree of seismic risk, provided
that the insurance pursuant to clauses (y) and (z) hereof shall be on terms
consistent with the special causes of loss form required under this subsection
(i);
 
 
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(ii)           commercial general liability insurance against claims for
personal injury, bodily injury, death or property damage occurring upon, in or
about the Property, with such insurance (A) to be on the so-called “occurrence”
form with a general aggregate limit of not less than $2,000,000 and a per
occurrence limit of not less than $1,000,000; (B) to continue at not less than
the aforesaid limit until required to be changed by Lender in writing by reason
of changed economic conditions making such protection inadequate; and (C) to
cover at least the following hazards: (1) premises and operations; (2) products
and completed operations; (3) independent contractors; and (4) contractual
liability;
 
(iii)           loss of rents insurance or business income insurance, as
applicable, (A) with loss payable to Lender; (B) covering all risks required to
be covered by the insurance provided for in subsection (i) above; and (C) which
provides that after the physical loss to the Improvements and Personal Property
occurs, the loss of rents or income, as applicable, will be insured until
completion of Restoration or the expiration of eighteen (18) months, whichever
first occurs, and notwithstanding that the policy may expire prior to the end of
such period; and (D) which contains an extended period of indemnity endorsement
which provides that after the physical loss to the Improvements and Personal
Property has been repaired, the continued loss of income will be insured until
such income either returns to the same level it was at prior to the loss, or the
expiration of twelve (12) months from the date that the Property is repaired or
replaced and operations are resumed, whichever first occurs, and notwithstanding
that the policy may expire prior to the end of such period.  For hotels, motels,
health care, and other property types without a standard rent roll, the amount
of business income insurance required shall be not less than eighteen (18)
months of debt service, taxes, insurance, and other fixed expenses. The amount
of such loss of rents or business income insurance, as applicable, shall be
determined prior to the date hereof and at least once each year thereafter based
on Borrower’s reasonable estimate of the gross income from the Property for the
succeeding period of coverage as required above.  All proceeds payable to Lender
pursuant to this subsection shall be held by Lender and shall be applied to the
obligations secured by the Loan Documents from time to time due and payable
hereunder and under the Note; provided, however, that nothing herein contained
shall be deemed to relieve Borrower of its obligations to pay the obligations
secured by the Loan Documents on the respective dates of payment provided for in
the Note, this Agreement and the other Loan Documents except to the extent such
amounts are actually paid out of the proceeds of such loss of rents or business
income insurance, as applicable;
 
 
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(iv)           at all times during which structural construction, repairs or
alterations are being made with respect to the Improvements, and only if the
Property coverage form does not otherwise apply, (A) owner’s contingent or
protective liability insurance covering claims not covered by or under the terms
or provisions of the above mentioned commercial general liability insurance
policy; and (B) the insurance provided for in subsection (i) above written in a
so-called Builder’s Risk Completed Value form (1) on a non-reporting basis, (2)
against “special causes of loss” insured against pursuant to subsection (i)
above, (3) including permission to occupy the Property, and (4) with an agreed
amount endorsement waiving co-insurance provisions;
 
(v)           workers’ compensation, subject to the statutory limits of the
State, and employer’s liability insurance in respect of any work or operations
on or about the Property, or in connection with the Property or its operation
(if applicable);
 
(vi)          comprehensive boiler and machinery insurance, if applicable, in
amounts as shall be reasonably required by Lender on terms consistent with the
commercial property insurance policy required under subsection (i) above;
 
(vii)          excess liability insurance in an amount not less than $25,000,000
per occurrence on terms consistent with the commercial general liability
insurance required under subsection (ii) above; and
 
(viii)         upon sixty (60) days’ written notice, such other reasonable
insurance and in such reasonable amounts as Lender from time to time may
reasonably request against such other insurable hazards (including, but not
limited to, sinkhole, mine subsidence, mold, spores or fungus) which at the time
are commonly insured against for property similar to the Property located in or
around the region in which the Property is located.
 
(b)           All insurance provided for in Section 8.1(a) shall be obtained
under valid and enforceable policies (collectively, the “Policies” or in the
singular, the “Policy”), and shall be subject to the approval of Lender as to
insurance companies, amounts, deductibles, loss payees and insureds. The
Policies shall be issued by financially sound and responsible insurance
companies authorized to do business in the State and having a claims paying
ability rating of “A-” or better by S&P (and the equivalent ratings for Moody’s
and Fitch) or such other ratings approved by Lender.  The Policies described in
Section 8.1(a) shall designate Lender and its successors and assigns as
additional insureds, mortgagees and/or loss payee as deemed appropriate by
Lender.  To the extent such Policies are not available as of the Closing Date,
Borrower shall deliver to Lender prior to the Closing Date an Acord 28 or
similar certificate of insurance evidencing the coverages and amounts required
hereunder and, upon request of Lender as soon as available after the Closing
Date, certified copies of all Policies.  Not less than ten (10) days prior to
the expiration dates of any insurance coverage in place with respect to the
Property, Borrower shall deliver to Lender an Acord 28 or similar certificate,
accompanied by evidence satisfactory to Lender of payment of the premiums due in
connection therewith (the “Insurance Premiums”), and, as soon as available
thereafter, certified copies of all renewal Policies.
 
 
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(c)           Any blanket insurance Policy shall provide the same protection as
would a separate Policy insuring only the Property in compliance with the
provisions of Section 8.1(a) hereof; provided, however, any blanket insurance
policy that does not specifically allocate to the Property the amount of
coverage from time to time required hereunder shall be subject to Lender’s
reasonable approval after taking into account, among other things, the amount,
location, number and type of properties covered by such blanket insurance
policy.
 
(d)           All Policies provided for or contemplated by Section 8.1(a),
except for the Policy referenced in Section 8.1(a)(v), shall name Borrower as
the insured and Lender as the additional insured, as its interests may appear,
and in the case of property damage, boiler and machinery, flood and earthquake
insurance, shall contain a standard non-contributing mortgagee clause in favor
of Lender providing that the loss thereunder shall be payable to Lender.
 
(e)           All Policies provided for in Section 8.1(a) shall contain clauses
or endorsements to the effect that:
 
(i)           no act or negligence of Borrower, or anyone acting for Borrower,
or of any Tenant or other occupant, or failure to comply with the provisions of
any Policy, which might otherwise result in a forfeiture of the insurance or any
part thereof, shall in any way affect the validity or enforceability of the
insurance insofar as Lender is concerned;
 
(ii)           the Policies shall not be materially changed (other than to
increase the coverage provided thereby) or canceled without at least thirty (30)
days’ prior written notice to Lender and any other party named therein as an
additional insured;
 
(iii)          the issuers thereof shall give written notice to Lender if the
Policies have not been renewed thirty (30) days prior to its expiration;
 
(iv)          Lender shall not be liable for any Insurance Premiums thereon or
subject to any assessments thereunder; and
 
(v)           the Policies do not contain an exclusion for acts of terrorism
(“Terrorism Insurance”); provided however, Borrower shall not be obligated to
expend more than $40,000 in any fiscal year on Insurance Premiums for Terrorism
Insurance (the “Terrorism Insurance Cap”) and if the cost of the Terrorism
Insurance exceeds the Terrorism Insurance Cap, Borrower shall purchase the
maximum amount of Terrorism Insurance available with funds equal to the
Terrorism Insurance Cap.
 
(f)           If at any time Lender is not in receipt of written evidence that
all insurance required hereunder is in full force and effect, Lender shall have
the right, without notice to Borrower, to take such action as Lender deems
necessary to protect its interest in the Property, including, without
limitation, obtaining such insurance coverage as Lender in its sole discretion
deems appropriate.  All premiums incurred by Lender in connection with such
action or in obtaining such insurance and keeping it in effect shall be paid by
Borrower to Lender upon demand and, until paid, shall be secured by the Mortgage
and shall bear interest at the Default Rate.
 
 
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Section 8.2                      Casualty
 
If the Property shall be damaged or destroyed, in whole or in part, by fire or
other casualty (a “Casualty”), Borrower shall give prompt notice of such damage
to Lender and shall promptly commence and diligently prosecute the Restoration
of the Property in accordance with Section 8.4.  Borrower shall pay all costs of
such Restoration whether or not such costs are covered by insurance.  Lender
may, but shall not be obligated to make proof of loss if not made promptly by
Borrower.  Borrower shall adjust all claims for Insurance Proceeds in
consultation with, and approval of, Lender; provided, however, if an Event of
Default has occurred and is continuing, Lender shall have the exclusive right to
participate in the adjustment of all claims for Insurance Proceeds.
 
Section 8.3                      Condemnation
 
Borrower shall promptly give Lender notice of the actual or threatened
commencement of any proceeding for the Condemnation of the Property of which
Borrower has knowledge and shall deliver to Lender copies of any and all papers
served in connection with such proceedings.  Lender may participate in any such
proceedings, and Borrower shall from time to time deliver to Lender all
instruments requested by it to permit such participation.  Borrower shall, at
its expense, diligently prosecute any such proceedings, and shall consult with
Lender, its attorneys and experts, and cooperate with them in the carrying on or
defense of any such proceedings.  Notwithstanding any taking by any public or
quasi-public authority through Condemnation or otherwise (including but not
limited to any transfer made in lieu of or in anticipation of the exercise of
such taking), Borrower shall continue to pay the Debt at the time and in the
manner provided for its payment in the Note and in this Agreement and the Debt
shall not be reduced until any Award shall have been actually received and
applied by Lender, after the deduction of expenses of collection, to the
reduction or discharge of the Debt.  Lender shall not be limited to the interest
paid on the Award by the condemning authority but shall be entitled to receive
out of the Award interest at the rate or rates provided herein or in the
Note.  If the Property or any portion thereof is taken by a condemning
authority, Borrower shall promptly commence and diligently prosecute the
Restoration of the Property and otherwise comply with the provisions of Section
8.4, whether or not Lender makes any Net Proceeds available pursuant to Section
8.4.  If the Property is sold, through foreclosure or otherwise, prior to the
receipt by Lender of the Award, Lender shall have the right, whether or not a
deficiency judgment on the Note shall have been sought, recovered or denied, to
receive the Award, or a portion thereof sufficient to pay the Debt.
 
Section 8.4                      Restoration
 
The following provisions shall apply in connection with the Restoration of the
Property:
 
(a)           If the Net Proceeds shall be less than $1,000,000 and the costs of
completing the Restoration shall be less than $1,000,000, the Net Proceeds will
be disbursed by Lender to Borrower upon receipt, provided that all of the
conditions set forth in Section 8.4(b)(i) are met and Borrower delivers to
Lender a written undertaking to expeditiously commence and to satisfactorily
complete with due diligence the Restoration in accordance with the terms of this
Agreement.
 
 
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(b)           If the Net Proceeds are equal to or greater than $1,000,000 or the
costs of completing the Restoration are equal to or greater than $1,000,000,
Lender shall make the Net Proceeds available for the Restoration subject to the
conditions of and in accordance with the provisions of this Section 8.4.  The
term “Net Proceeds” for purposes of this Section 8.4 shall mean: (i) the net
amount of all insurance proceeds received by Lender pursuant to Section
8.1(a)(i), (iv), (vi) and (viii) as a result of a Casualty, after deduction of
its reasonable costs and expenses (including, but not limited to, reasonable
counsel fees), if any, in collecting the same (“Insurance Proceeds”), or (ii)
the net amount of the Award as a result of a Condemnation, after deduction of
its reasonable costs and expenses (including, but not limited to, reasonable
counsel fees), if any, in collecting the same (“Condemnation Proceeds”),
whichever the case may be.
 
(i)            The Net Proceeds shall be made available to Borrower for
Restoration provided that each of the following conditions are met:
 
(A)           no Event of Default shall have occurred and be continuing;
 
(B)           (1)  in the event the Net Proceeds are Insurance Proceeds, less
than thirty percent (30%) of the total floor area of the Improvements on the
Property has been damaged, destroyed or rendered unusable as a result of a
Casualty and the amount of damage does not exceed thirty percent (30%) of the
Property’s fair market value immediately prior to the occurrence of such
Casualty, or (2) in the event the Net Proceeds are Condemnation Proceeds, less
than ten percent (10%) of the land constituting the Property is taken, such land
is located along the perimeter or periphery of the Property, and less than
fifteen percent (15%) of the aggregate floor area of the Improvements is taken
and the taking does not exceed fifteen percent (15%) of the Property’s fair
market value immediately prior to the occurrence of such taking;
 
(C)           Leases covering in the aggregate at least seventy-five percent
(75%) of the total rentable space in the Property which has been demised under
executed and delivered Leases in effect as of the date of the occurrence of such
Casualty or Condemnation, whichever the case may be, and each Major Lease in
effect as of such date shall remain in full force and effect during and after
the completion of the Restoration without abatement of rent beyond the time
required for Restoration;
 
(D)           Borrower shall covenant to commence the Restoration as soon as
reasonably practicable (but in no event later than sixty (60) days after
receiving the Net Proceeds from such Casualty or Condemnation, whichever the
case may be, occurs) and shall diligently pursue the same to satisfactory
completion;
 
(E)           Lender shall be satisfied that any operating deficits, including
all scheduled payments of principal and interest under the Note, which will be
incurred with respect to the Property as a result of the occurrence of any such
Casualty or Condemnation, whichever the case may be, will be covered out of the
insurance coverage referred to in Section 8.1(a)(iii) above;
 
 
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(F)           Lender shall be satisfied that the Restoration will be completed
on or before the earliest to occur of (1) six (6) months prior to the Maturity
Date, (2) the earliest date required for such completion under the terms of any
Leases or material agreements affecting the Property, (3) such time as may be
required under applicable zoning law, ordinance, rule or regulation, or (4) the
expiration of the insurance coverage referred to in Section 8.1(a)(iii);
 
(G)           the Property and the use thereof after the Restoration will be in
compliance with and permitted under all Legal Requirements;
 
(H)           the Restoration shall be done and completed by Borrower in an
expeditious and diligent fashion and in compliance with all applicable Legal
Requirements;
 
(I)             such Casualty or Condemnation, as applicable, does not result in
the loss of access to the Property or the Improvements;
 
(J)            Borrower shall deliver, or cause to be delivered, to Lender a
signed detailed budget approved in writing by Borrower’s architect or engineer
stating the entire cost of completing the Restoration, which budget shall be
acceptable to Lender;
 
(K)           the Net Proceeds together with any cash or cash equivalent
deposited by Borrower with Lender are sufficient in Lender’s reasonable judgment
to cover the cost of the Restoration; and
 
(L)            Lender shall be satisfied that the Debt Service Coverage Ratio
for the Property, after giving effect to the Restoration, shall be equal or
greater than 1.10 to 1.0.
 
(ii)           The Net Proceeds shall be held by Lender until disbursements
commence, and, until disbursed in accordance with the provisions of this Section
8.4(b), shall constitute additional security for the Debt and other obligations
under the Loan Documents.  The Net Proceeds shall be disbursed by Lender to, or
as directed by, Borrower from time to time during the course of the Restoration,
upon receipt of evidence satisfactory to Lender that (A) all the conditions
precedent to such advance, including those set forth in Section 8.4(b)(i), have
been satisfied, (B) all materials installed and work and labor performed (except
to the extent that they are to be paid for out of the requested disbursement) in
connection with the related Restoration item have been paid for in full, and (C)
there exist no notices of pendency, stop orders, mechanic’s or materialman’s
liens or notices of intention to file same, or any other liens or encumbrances
of any nature whatsoever on the Property which have not either been fully bonded
to the satisfaction of Lender and discharged of record or in the alternative
fully insured to the satisfaction of Lender by the title company issuing the
Title Insurance Policy.  Notwithstanding the foregoing, Insurance Proceeds from
the Policies required to be maintained by Borrower pursuant to Section
8.1(a)(iii) shall be controlled by Lender at all times, shall not be subject to
the provisions of this Section 8.4 and shall be used solely for the payment of
the obligations under the Loan Documents and Operating Expenses.
 
 
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(iii)           All plans and specifications required in connection with the
Restoration shall be subject to prior review and acceptance in all respects by
Lender and by an independent consulting engineer selected by Lender (the
“Restoration Consultant”).  Lender shall have the use of the plans and
specifications and all permits, licenses and approvals required or obtained in
connection with the Restoration.  The identity of the contractors,
subcontractors and materialmen engaged in the Restoration, as well as the
contracts in excess of $500,000 under which they have been engaged, shall be
subject to prior review and acceptance by Lender and the Restoration Consultant
not to be unreasonably withheld, delayed or conditioned.  All costs and expenses
incurred by Lender in connection with making the Net Proceeds available for the
Restoration, including, without limitation, reasonable counsel fees and
disbursements and the Restoration Consultant’s fees, shall be paid by Borrower.
 
(iv)           In no event shall Lender be obligated to make disbursements of
the Net Proceeds in excess of an amount equal to the costs actually incurred
from time to time for work in place as part of the Restoration, as certified by
the Restoration Consultant, minus the Restoration Retainage.  The term
“Restoration Retainage” shall mean an amount equal to ten percent (10%) of the
costs actually incurred for work in place as part of the Restoration, as
certified by the Restoration Consultant, until the Restoration has been
completed.  The Restoration Retainage shall be reduced to five percent (5%) of
the costs incurred upon receipt by Lender of satisfactory evidence that fifty
percent (50%) of the Restoration has been completed.  The Restoration Retainage
shall in no event, and notwithstanding anything to the contrary set forth above
in this Section 8.4(b), be less than the amount actually held back by Borrower
from contractors, subcontractors and materialmen engaged in the
Restoration.  The Restoration Retainage shall not be released until the
Restoration Consultant certifies to Lender that the Restoration has been
completed in accordance with the provisions of this Section 8.4(b)and that all
approvals necessary for the re-occupancy and use of the Property have been
obtained from all appropriate Governmental Authorities, and Lender receives
evidence satisfactory to Lender that the costs of the Restoration have been paid
in full or will be paid in full out of the Restoration Retainage; provided,
however, that Lender will release the portion of the Restoration Retainage being
held with respect to any contractor, subcontractor or materialman engaged in the
Restoration as of the date upon which the Restoration Consultant certifies to
Lender that the contractor, subcontractor or materialman has satisfactorily
completed all work and has supplied all materials in accordance with the
provisions of the contractor’s, subcontractor’s or materialman’s contract, the
contractor, subcontractor or materialman delivers the lien waivers and evidence
of payment in full of all sums due to the contractor, subcontractor or
materialman as may be reasonably requested by Lender or by the title company
issuing the Title Insurance Policy, and Lender receives an endorsement to the
Title Insurance Policy insuring the continued priority of the lien of the
Mortgage and evidence of payment of any premium payable for such
endorsement.  If required by Lender, the release of any such portion of the
Restoration Retainage shall be approved by the surety company, if any, which has
issued a payment or performance bond with respect to the contractor,
subcontractor or materialman.
 
 
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(v)            Lender shall not be obligated to make disbursements of the Net
Proceeds more frequently than once every calendar month.
 
(vi)           If at any time the Net Proceeds or the undisbursed balance
thereof shall not, in the reasonable opinion of Lender in consultation with the
Restoration Consultant, be sufficient to pay in full the balance of the costs
which are estimated by the Restoration Consultant to be incurred in connection
with the completion of the Restoration, Borrower shall deposit the deficiency
(the “Net Proceeds Deficiency”) with Lender before any further disbursement of
the Net Proceeds shall be made.  The Net Proceeds Deficiency deposited with
Lender shall be held by Lender and shall be disbursed for costs actually
incurred in connection with the Restoration on the same conditions applicable to
the disbursement of the Net Proceeds, and until so disbursed pursuant to this
Section 8.4(b) shall constitute additional security for the Debt and other
obligations under the Loan Documents.
 
(vii)           The excess, if any, of the Net Proceeds and the remaining
balance, if any, of the Net Proceeds Deficiency deposited with Lender after the
Restoration Consultant certifies to Lender that the Restoration has been
completed in accordance with the provisions of this Section 8.4(b), and the
receipt by Lender of evidence satisfactory to Lender that all costs incurred in
connection with the Restoration have been paid in full, shall be remitted by
Lender to Borrower, provided no Event of Default shall have occurred and shall
be continuing under the Note, this Agreement or any of the other Loan Documents.
 
(c)           All Net Proceeds not required (i) to be made available for the
Restoration or (ii) to be returned to Borrower as excess Net Proceeds pursuant
to Section 8.4(b)(vii) may (x) be retained and applied by Lender toward the
payment of the Debt whether or not then due and payable in such order, priority
and proportions as Lender in its sole discretion shall deem proper, or, (y) at
the sole discretion of Lender, the same may be paid, either in whole or in part,
to Borrower for such purposes and upon such conditions as Lender shall
designate.  If, pursuant to this Section 8.4, Lender shall receive and retain
Net Proceeds, the Debt shall be reduced only by the amount thereof received and
retained by Lender and actually applied by Lender in reduction thereof.
 
(d)           In the event of foreclosure of the Mortgage, or other transfer of
title to the Property in extinguishment in whole or in part of the Debt, all
right, title and interest of Borrower in and to the Policies then in force
concerning the Property and all proceeds payable thereunder shall thereupon vest
in the purchaser at such foreclosure, Lender or other transferee in the event of
such other transfer of title.
 
 
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ARTICLE 9
RESERVE FUNDS
 
Section 9.1                      Required Repairs
 
(a)           Borrower shall make the repairs and improvements to the Property
set forth on Schedule 9.1 and as more particularly described in the Property
Condition Report prepared in connection with the closing of the Loan (such
repairs hereinafter referred to as “Required Repairs”).  Borrower shall complete
the Required Repairs in a good and workmanlike manner on or before the date that
is twelve (12) months from the date hereof or within such other time frame for
completion specifically set forth on Schedule 9.1.
 
(b)           Borrower shall establish on the date hereof an Eligible Account
with Lender or Lender’s agent to fund the Required Repairs (the “Required Repair
Account”) into which Borrower shall deposit on the date hereof the amount of
$328,125, which amount equals 125% of the estimated cost for the completion of
the Required Repairs.  Amounts so deposited shall hereinafter be referred to as
the “Required Repair Funds.”
 
Section 9.2                      Replacements
 
(a)           On an ongoing basis throughout the term of the Loan, Borrower
shall make capital repairs, replacements and improvements necessary to keep the
Property in good order and repair and in a good marketable condition or prevent
deterioration of the Property, including, but not limited to, those repairs,
replacements and improvements more particularly described in the Property
Condition Report prepared in connection with the closing of the Loan
(collectively, the “Replacements”).  Borrower shall complete all Replacements in
a good and workmanlike manner as soon as commercially reasonable after
commencing to make each such Replacement.
 
(b)           Borrower shall establish on the date hereof an Eligible Account
with Lender or Lender’s agent to fund the Replacements (the “Replacement Reserve
Account”).  Borrower shall deposit $11,447.71 (the “Replacement Reserve Monthly
Deposit”) into the Replacement Reserve Account on each Scheduled Payment
Date.  Amounts so deposited shall hereinafter be referred to as “Replacement
Reserve Funds.”
 
Section 9.3                      Tenant Improvements and Leasing Commissions
 
(a)           Borrower hereby agrees to (a) perform, or cause to be performed,
tenant improvements required under any Lease entered into in accordance with the
provisions of Section 5.13 of this Agreement (collectively, the “Tenant
Improvements”), and (b) pay the costs of leasing commissions incurred by
Borrower in connection with the leasing of the Property or a portion thereof
(collectively, “Leasing Commissions”).
 
(b)           Borrower shall establish on the date hereof an Eligible Account
with Lender or Lender’s agent to fund Tenant Improvements and Leasing
Commissions (the “Leasing Reserve Account”).  Borrower shall deposit with Lender
into the Leasing Reserve Account (i) $22,042.42 (the “Leasing Reserve Monthly
Deposit”) on each Scheduled Payment Date and (ii) any sum or termination fee
payable to Borrower in connection with any Tenant’s election to exercise any
early termination option contained in its respective lease of space at the
Property (the “Termination Fee Deposit”) on the date of Borrower’s receipt
thereof; provided, however, Borrower’s obligation to make the Leasing Reserve
Monthly Deposit shall be suspended for so long as the Leasing Reserve Account
contains at least $1,300,000.00.  Amounts so deposited shall hereinafter be
referred to as the “Leasing Reserve Funds.”
 
 
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Section 9.4                      Required Work
 
Borrower shall diligently pursue all Required Repairs and Replacements and
Tenant Improvements (collectively, the “Required Work”) to completion in
accordance with the following requirements:
 
(a)           Lender reserves the right, at its option, to approve all contracts
or work orders with materialmen, mechanics, suppliers, subcontractors,
contractors or other parties providing labor or materials in connection with the
Required Work to the extent such contracts or work orders exceed $500,000, which
approval shall not be unreasonably withheld, delayed or conditioned.  Upon
Lender’s request, Borrower shall assign any contract or subcontract to Lender.
 
(b)           In the event Lender determines in its reasonable discretion that
any Required Work is not being or has not been performed in a workmanlike or
timely manner, Lender shall have the option to (i) withhold disbursement for
such unsatisfactory Required Work and/or (ii) after giving ten (10) days prior
written notice to Borrower describing in reasonable particularity the lack of
performance or deficient performance in any Required Work being done, and
Borrower’s failure to either cure such deficiency within such ten (10) day
period to proceed under existing contracts or to contract with third parties to
complete such Required Work and to apply the Required Repair Funds or the
Replacement Reserve Funds, as applicable, toward the labor and materials
necessary to complete such Required Work and to exercise any and all other
remedies available to Lender upon an Event of Default hereunder.
 
(c)           In order to facilitate Lender’s completion of the Required Work,
Borrower grants Lender the right to enter onto the Property and perform any and
all work and labor necessary to complete the Required Work and/or employ
watchmen to protect the Property from damage.  All sums so expended by Lender,
to the extent not from the Reserve Funds, shall be deemed to have been advanced
under the Loan to Borrower and secured by the Mortgage.  For this purpose
Borrower constitutes and appoints Lender its true and lawful attorney-in-fact
with full power of substitution to complete or undertake the Required Work in
the name of Borrower upon Borrower’s failure to do so in a workmanlike and
timely manner.  Such power of attorney shall be deemed to be a power coupled
with an interest and cannot be revoked.  Borrower empowers said attorney-in-fact
as follows: (i) to use any of the Reserve Funds for the purpose of making or
completing the Required Work; (ii) to make such additions, changes and
corrections to the Required Work as shall be necessary or desirable to complete
the Required Work; (iii) to employ such contractors, subcontractors, agents,
architects and inspectors as shall be required for such purposes; (iv) to pay,
settle or compromise all existing bills and claims which are or may become Liens
against the Property, or as may be necessary or desirable for the completion of
the Required Work, or for clearance of title; (v) to execute all applications
and certificates in the name of Borrower which may be required by any of the
contract documents; (vi) to prosecute and defend all actions or proceedings in
connection with the Property or the rehabilitation and repair of the Property;
and (vii) to do any and every act which Borrower might do on its own behalf to
fulfill the terms of this Agreement.
 
 
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(d)           Nothing in this Section 9.4 shall: (i) make Lender responsible for
making or completing the Required Work; (ii) require Lender to expend funds in
addition to the Reserve Funds to make or complete any Required Work; (iii)
obligate Lender to proceed with the Required Work; or (iv) obligate Lender to
demand from Borrower additional sums to make or complete any Required Work.
 
(e)           Borrower shall permit Lender and Lender’s agents and
representatives (including, without limitation, Lender’s engineer, architect, or
inspector) or third parties performing Required Work pursuant to this Section
9.4 to enter onto the Property during normal business hours (subject to the
rights of tenants under their Leases) to inspect the progress of any Required
Work and all materials being used in connection therewith, to examine all plans
and shop drawings relating to such Required Work which are or may be kept at the
Property, and to complete any Required Work made pursuant to this Section
9.4.  Borrower shall cause all contractors and subcontractors to cooperate with
Lender and Lender’s representatives or such other persons described above in
connection with inspections described in this Section 9.4 or the completion of
Required Work pursuant to this Section 9.4.
 
(f)           Lender may, to the extent any Required Work would reasonably
require an inspection of the Property, inspect the Property at Borrower’s
expense prior to making a disbursement of the Reserve Funds in order to verify
completion of the Required Work for which reimbursement is sought.  Borrower
shall pay Lender a reasonable inspection fee not exceeding $1,000 for each such
inspection.  Lender may require that such inspection be conducted by an
appropriate independent qualified professional selected by Lender and/or may
require a copy of a certificate of completion by an independent qualified
professional acceptable to Lender prior to the disbursement of the Reserve
Funds.  Borrower shall pay the expense of the inspection as required hereunder,
whether such inspection is conducted by Lender or by an independent qualified
professional.
 
(g)           The Required Work and all materials, equipment, fixtures, or any
other item comprising a part of any Required Work shall be constructed,
installed or completed, as applicable, free and clear of all mechanic’s,
materialman’s or other Liens (except for Permitted Encumbrances).
 
(h)           Before each disbursement of the Reserve Funds for Required Work of
$250,000 or more, Lender may require Borrower to provide Lender with a search of
title to the Property effective to the date of the disbursement, which search
shows that no mechanic’s or materialmen’s or other Liens of any nature have been
placed against the Landlord’s interest in the Property since the date of
recordation of the Mortgage and that title to the Landlord’s interest in the
Property is free and clear of all Liens (except for Permitted Encumbrances).
 
(i)            All Required Work shall comply with all Legal Requirements and
applicable insurance requirements including, without limitation, applicable
building codes, special use permits, environmental regulations, and requirements
of insurance underwriters.
 
(j)            Borrower hereby assigns to Lender all rights and claims Borrower
may have against all Persons supplying labor or materials in connection with the
Required Work; provided, however, that Lender may not pursue any such rights or
claims unless an Event of Default has occurred and remains uncured.
 
 
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Section 9.5                      Release of Reserve Funds
 
(a)           Upon written request from Borrower and satisfaction of the
requirements set forth in this Agreement, Lender shall disburse to Borrower
amounts from (i) the Required Repair Account to the extent necessary to pay for
or reimburse Borrower for the actual costs of each Required Repair (but not
exceeding 125% of the original estimated cost of such Required Repair as set
forth on Schedule 9.1, unless Lender has agreed to reimburse Borrower for such
excess cost pursuant to Section 9.5(f)),  (ii) the Replacement Reserve Account
to the extent necessary to pay for or reimburse Borrower for the actual costs of
any approved Replacements or (iii) the Leasing Reserve Account to the extent
necessary to pay for or reimburse Borrower for the actual costs of Tenant
Improvements and/or Leasing Commissions incurred in connection with Leases
entered into in accordance with the Loan Documents, provided that (A) such
Leasing Commissions are reasonable and customary for properties similar to the
Property and the portion of the Property leased for which such Leasing
Commissions are due, and (B) the amount of such Leasing Commissions are
determined pursuant to arm’s-length transactions between Borrower and any
leasing agent to which a Leasing Commission is due, and excluding any Leasing
Commissions which shall be due any member, general partner or shareholder of
Borrower or any Affiliate of Borrower.  Notwithstanding the preceding sentence,
in no event shall Lender be required to (x) disburse any amounts which would
cause the amount of funds remaining in the Required Repair Account after any
disbursement (other than with respect to the final disbursement) to be less than
125% of the then current estimated cost of completing all remaining Required
Repairs for the Property, (y) disburse funds from any of the Reserve Accounts if
an Event of Default exists, or (z) disburse funds from the Replacement Reserve
Account to reimburse Borrower for the costs of routine repairs or maintenance to
the Property or for costs which are to be reimbursed from funds held in the
Required Repair Account or for Tenant Improvements and Leasing Commissions.
 
(b)           With each request for disbursement, Borrower shall certify in
writing to Lender that all Required Work has been performed in accordance with
all Legal Requirements and that all such Required Work has been completed lien
free and paid for in full or will be paid for in full upon disbursement of the
requested funds. In addition, each request for disbursement in excess of $50,000
shall be on a form provided or approved by Lender and shall (i) include copies
of invoices for all items or materials purchased and all labor or services
provided, (ii) specify (A) the Required Work for which the disbursement is
requested, (B) the quantity and price of each item purchased, if the Required
Work includes the purchase or replacement of specific items, (C) the price of
all materials (grouped by type or category) used in any Required Work other than
the purchase or replacement of specific items, and (D) the cost of all
contracted labor or other services applicable to each Required Work for which
such request for disbursement is made, (iii) if requested by Lender, conditional
lien waivers from each contractor, supplier, materialman, mechanic or
subcontractor with respect to the completion of its work or delivery of its
materials, and (iv) include, if such request for disbursement is in connection
with Tenant Improvements, a certificate from the Tenant(s) for which the Tenant
Improvements have been performed stating that such Tenant Improvements have been
completed in a manner satisfactory and acceptable to such Tenant(s) and (unless
disbursement is requested pursuant to Section 9.5(d)), such Tenant(s) has
accepted the premises demised under the applicable Lease(s), and containing such
other information as Lender may require, in form and substance reasonably
satisfactory to Lender, and/or if such request for disbursement is in connection
with Leasing Commissions, a certificate from the leasing agent that no further
sums are due to it in connection with the applicable Lease.  Except as provided
in Section 9.5(d), each request for disbursement shall be made only after
completion of the Required Repair, Replacement or Tenant Improvement (or the
portion thereof completed in accordance with Section 9.5(d)), or the full
performance by the leasing agent of its obligations (in the case of Leasing
Commissions), as applicable, for which disbursement is requested.  Borrower
shall provide Lender evidence satisfactory to Lender in its reasonable judgment
of such completion or performance.
 
 
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(c)           Any lien waiver delivered hereunder shall conform to all Legal
Requirements and shall cover all work performed and materials supplied
(including equipment and fixtures) for the Property by that contractor,
supplier, subcontractor, mechanic or materialman through the date covered by the
current disbursement request.  In the case of Leasing Commissions, payment shall
be made to any leasing agent to which a Leasing Commission is due in the amount
of invoices submitted by such leasing agent, provided all of the other
conditions for disbursements for such Leasing Commissions are satisfied in the
judgment of Lender.
 
(d)           If (i) the cost of any item of Required Work exceeds $50,000, (ii)
the contractor performing such Required Work requires periodic payments pursuant
to terms of a written contract, and (iii) Lender has approved in writing in
advance such periodic payments, a request for disbursement from the Reserve
Accounts may be made after completion of a portion of the work under such
contract, provided (A) such contract requires payment upon completion of such
portion of work, (B) the materials for which the request is made are on site at
the Property and are properly secured or have been installed in the Property,
(C) all other conditions in this Agreement for disbursement have been satisfied,
and (D) in the case of a Replacement, funds remaining in the Replacement Reserve
Account are, in Lender’s judgment, sufficient to complete such Replacement and
other Replacements when required.
 
(e)           Borrower shall not make a request for, nor shall Lender have any
obligation to make, any disbursement from any Reserve Account more frequently
than once in any calendar month and (except in connection with the final
disbursement) in any amount less than the lesser of (i) $10,000 or (ii) the
total cost of the Required Work or Leasing Commission for which the disbursement
is requested.
 
(f)            In the event any Borrower requests a disbursement from the
Required Repair Account to pay for or to reimburse Borrower for the actual cost
of labor or materials used in connection with repairs or improvements other than
the Required Repairs specified on Schedule 9.1, or for a Required Repair to the
extent the cost of such Required Repair exceeds 125% of the estimated cost of
such Required Repair as set forth on Schedule 9.1 (in either case, an
“Additional Required Repair”), Borrower shall disclose in writing to Lender the
reason why funds in the Required Repair Account should be used to pay for such
Additional Required Repair.  If Lender determines that (i) such Additional
Required Repair is of the type intended to be covered by the Required Repair
Account, (ii) such Additional Required Repair is not covered or is not of the
type intended to be covered by the Replacement Reserve Account, (iii) costs for
such Additional Required Repair are reasonable, (iv) the funds in the Required
Repair Account are sufficient to pay for such Additional Required Repair and all
other Required Repairs for the Property specified on Schedule 9.1, and (v) all
other conditions for disbursement under this Agreement have been met, Lender may
disburse funds from the Required Repair Account.
 
 
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(g)           In the event any Borrower requests a disbursement from the
Replacement Reserve Account to pay for or to reimburse Borrower for the actual
cost of labor or materials used in connection with repairs or improvements other
than the Replacements specified in the Property Condition Report prepared in
connection with the closing of the Loan (an “Additional Replacement”), Borrower
shall disclose in writing to Lender the reason why funds in the Replacement
Reserve Account should be used to pay for such Additional Replacement.  If
Lender determines that (i) such Additional Replacement is of the type intended
to be covered by the Replacement Reserve Account, (ii) such Additional
Replacement is not covered or is not of the type intended to be covered by the
Required Repair Account, (iii) costs for such Additional Replacement are
reasonable, (iv) the funds in the Replacement Reserve Account are sufficient to
pay for such Additional Replacement and all other Replacements for the Property
specified in the Property Condition Report, and (v) all other conditions for
disbursement under this Agreement have been met, Lender may disburse funds from
the Replacement Reserve Account.
 
(h)           Lender’s disbursement of any Reserve Funds or other acknowledgment
of completion of any Required Work in a manner satisfactory to Lender shall not
be deemed a certification or warranty by Lender to any Person that the Required
Work has been completed in accordance with Legal Requirements.
 
(i)            If the funds in any Reserve Account should exceed the amount of
payments actually applied by Lender for the purposes of the account, Lender in
its sole discretion shall either return any excess to Borrower or credit such
excess against future payments to be made to that Reserve Account.  If at any
time Lender reasonably determines that the Reserve Funds are not or will not be
sufficient to make the required payments, Lender shall notify Borrower of such
determination and Borrower shall pay to Lender any amount necessary to make up
the deficiency within ten (10) days after notice from Lender to Borrower
requesting payment thereof.
 
(j)            The insufficiency of any balance in any of the Reserve Accounts
shall not relieve Borrower from its obligation to fulfill all preservation and
maintenance covenants in the Loan Documents.
 
(k)           Upon the earlier to occur of (i) the timely completion of all
Required Repairs and any Additional Required Repairs, if any, in accordance with
the requirements of this Agreement, as verified by Lender in its reasonable
discretion, or (ii) the payment in full of the Debt, all amounts remaining on
deposit, if any, in the Required Repair Account shall be returned to Borrower or
the Person shown on Lender's records as being the owner of the Property and no
other party shall have any right or claim thereto.
 
(l)            Upon payment in full of the Debt, all amounts remaining on
deposit, if any, in the Replacement Reserve Account shall be returned to
Borrower or the Person shown on Lender's records as being the owner of the
Property and no other party shall have any right or claim thereto.
 
(m)          Upon the payment in full of the Debt, all amounts remaining on
deposit, if any, in the Leasing Reserve Account shall be returned to Borrower or
the Person shown on Lender's records as being the owner of the Property and no
other party shall have any right or claim thereto.
 
 
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Section 9.6                      Tax and Insurance Reserve Funds
 
Borrower shall establish on the date hereof an Eligible Account with Lender or
Lender’s agent sufficient to discharge Borrower’s obligations for the payment of
Taxes and Insurance Premiums pursuant to Section 5.4 and Section 8.1 hereof (the
“Tax and Insurance Reserve Account”) into which Borrower shall deposit an
amount, when added to the required monthly deposits set forth in the next
sentence, is sufficient to make the payments of Taxes and Insurance Premiums as
required herein.  Borrower shall deposit into the Tax and Insurance Reserve
Account on each Scheduled Payment Date (a) one-twelfth of the Taxes that Lender
estimates will be payable during the next ensuing twelve (12) months or such
higher amount necessary to accumulate with Lender sufficient funds to pay all
such Taxes at least thirty (30) days prior to the earlier of (i) the date that
the same will become delinquent and (ii) the date that additional charges or
interest will accrue due to the non-payment thereof, and (b) except to the
extent the insurance required hereunder is maintained under a blanket insurance
Policy acceptable to Lender in accordance with Section 8.1(c), one-twelfth of
the Insurance Premiums that Lender estimates will be payable during the next
ensuing twelve (12) months for the renewal of the coverage afforded by the
Policies upon the expiration thereof or such higher amount necessary to
accumulate with Lender sufficient funds to pay all such Insurance Premiums at
least thirty (30) days prior to the expiration of the Policies (said amounts in
(a) and (b) above hereinafter called the “Tax and Insurance Reserve
Funds”).  Lender will apply the Tax and Insurance Reserve Funds to payments of
Taxes and Insurance Premiums required to be made by Borrower pursuant to Section
5.4 and Section 8.1 hereof.  In making any disbursement from the Tax and
Insurance Reserve Account, Lender may do so according to any bill, statement or
estimate procured from the appropriate public office or tax lien service (with
respect to Taxes) or insurer or agent (with respect to Insurance Premiums),
without inquiry into the accuracy of such bill, statement or estimate or into
the validity of any tax, assessment, sale, forfeiture, tax lien or title or
claim thereof.  If the amount of the Tax and Insurance Reserve Funds shall
exceed the amounts due for Taxes and Insurance Premiums pursuant to Section 5.4
and Section 8.1 hereof, Lender shall, in its sole discretion, return any excess
to Borrower or credit such excess against future payments to be made to the Tax
and Insurance Reserve Account.  In allocating any such excess, Lender may deal
with the person shown on Lender’s records as being the owner of the
Property.  Any amount remaining in the Tax and Insurance Reserve Account after
the Debt has been paid in full shall be returned to Borrower or the person shown
on Lender’s records as being the owner of the Property and no other party shall
have any right or claim thereto.  If at any time Lender reasonably determines
that the Tax and Insurance Reserve Funds are not or will not be sufficient to
pay Taxes and Insurance Premiums by the dates set forth in (a) and (b) above,
Lender shall notify Borrower of such determination and Borrower shall pay to
Lender any amount necessary to make up the deficiency within ten (10) days after
notice from Lender to Borrower requesting payment thereof.
 
Section 9.7                      Excess Cash; Operating Expenses; Extraordinary
Expenses
 
(a)           Borrower shall establish on the date hereof an Eligible Account
with Lender or Lender’s agent into which Borrower shall deposit all Excess Cash
on each Scheduled Payment Date during the continuation of a Cash Sweep Period
(the “Excess Cash Reserve Account”) to be held by Lender as additional security
for the Loan.  Amounts so deposited shall hereinafter be referred to as the
“Excess Cash Reserve Funds.”  Provided no Event of Default has occurred and is
continuing, all sums on deposit in the Excess Cash Reserve Account shall be
disbursed to Borrower’s Account upon the earlier to occur of (a) payment in full
of the Debt or (b) the discontinuation of a Cash Sweep Period.  In the event a
Cash Sweep Period occurs twice during the term of the Loan, Borrower shall not
be entitled to any disbursement of Excess Cash Reserve Funds during the
remaining term of the Loan, the Cash Sweep Period shall continue, and Borrower
shall continue to be obligated to pay Excess Cash to Lender on each Scheduled
Payment Date until the Debt is paid in full.
 
 
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(b)           During the continuation of a Cash Sweep Period, Borrower shall
submit to Lender not later than the twentieth (20th) day of each calendar month,
a statement certified by Borrower in the form required by Lender (i) setting
forth those Operating Expenses and Extraordinary Expenses to be paid by Borrower
during the following calendar month, (ii) stating that no Operating Expenses or
Extraordinary Expenses are more than sixty (60) days past due.  Together with
each such request, Borrower shall furnish Lender with bills and all other
documents necessary for the payment of the Operating Expenses and/or
Extraordinary Expenses which are the subject of such request.  Only those
Operating Expenses which are consistent with the Annual Budget, as well as those
Operating Expenses and Extraordinary Expenses otherwise approved by Lender in
writing in its reasonable discretion, shall be approved for payment and shall be
disbursed to Borrower’s Account on the next Scheduled Payment Date.
 
Section 9.8                      Holdback Reserve.
 
(a)           Borrower hereby agrees to perform, or cause to be performed,
tenant improvements, tenant’s work and similar items required under the Ulta
Lease and the Oshkosh Lease in accordance with the applicable Lease
(collectively, the “Holdback Work”).
 
(b)           Borrower shall establish on the date hereof an Eligible Account
with Lender or Lender’s agent to fund the Holdback Work (the “Holdback Reserve
Account”) into which Borrower shall deposit on the date hereof [$1,400,000].
Amounts so deposited shall hereinafter be referred to as the “Holdback Reserve
Funds.”
 
(c)           Lender shall disburse to Borrower (i) [$125,000], upon Lender’s
receipt of a Holdback Estoppel reasonably acceptable to Lender from Oshkosh and
(ii) [$1,275,000] upon Lender’s receipt of a Holdback Estoppel reasonably
acceptable to Lender from Ulta.
 
Section 9.9                      Reserve Funds Generally
 
(a)                      (i) Except for the Required Repair Account, the
Replacement Reserve Account, the Leasing Reserve Account, the Holdback Reserve
Account and the Excess Cash Reserve Account, no earnings or interest on the
Reserve Accounts shall be payable to Borrower.  Neither Lender nor any loan
servicer that at any time holds or maintains such non-interest-bearing Reserve
Accounts shall have any obligation to keep or maintain such Reserve Accounts or
any funds deposited therein in interest-bearing accounts.  If Lender or any such
loan servicer elects in its sole and absolute discretion to keep or maintain any
non-interest-bearing Reserve Account or any funds deposited therein in an
interest-bearing account, the account shall be an Eligible Account and (A) such
funds shall not be invested except in Permitted Investments, and (B) all
interest earned or accrued thereon shall be for the account of and be retained
by Lender or such loan servicer.
 
 
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(ii)           Funds deposited in the Required Repair Account, the Replacement
Reserve Account, the Holdback Reserve Account, the Leasing Reserve Account and
the Excess Cash Reserve Account shall be held in an interest-bearing business
savings account and interest shall be credited to Borrower.  In no event shall
Lender or any loan servicer that at any time holds or maintains such Reserve
Accounts be required to select any particular interest-bearing account or the
account that yields the highest rate of interest, provided that selection of the
account shall be consistent with the general standards at the time being
utilized by Lender or the loan servicer, as applicable, in establishing similar
accounts for loans of comparable type.  All such interest shall be and become
part of the applicable Reserve Account and shall be disbursed in accordance with
the terms hereof; provided, however, that Lender may, at its election, retain
any such interest for its own account during the occurrence and continuance of
an Event of Default.  Borrower agrees that it shall include all interest on the
interest-bearing Reserve Funds as the income of Borrower (and, if Borrower is a
partnership or other pass-through entity, the partners, members or beneficiaries
of Borrower, as the case may be), and shall be the owner of the such Reserve
Funds for federal and applicable state and local tax purposes, except to the
extent that Lender retains any interest for its own account during the
occurrence and continuance of an Event of Default as provided herein.
 
(b)           Borrower grants to Lender a first-priority perfected security
interest in, and assigns and pledges to Lender, each of the Reserve Accounts and
any and all Reserve Funds now or hereafter deposited in the Reserve Accounts as
additional security for payment of the Debt.  Until expended or applied in
accordance herewith, the Reserve Accounts and the Reserve Funds shall constitute
additional security for the Debt.  The provisions of this Section 9.9 are
intended to give Lender or any subsequent holder of the Loan “control” of the
Reserve Accounts within the meaning of the UCC.
 
(c)           The Reserve Accounts and any and all Reserve Funds now or
hereafter deposited in the Reserve Accounts shall be subject to the exclusive
dominion and control of Lender, which shall hold the Reserve Accounts and any or
all Reserve Funds now or hereafter deposited in the Reserve Accounts subject to
the terms and conditions of this Agreement.  Borrower shall have no right of
withdrawal from the Reserve Accounts or any other right or power with respect to
the Reserve Accounts or any or all of the Reserve Funds now or hereafter
deposited in the Reserve Accounts, except as expressly provided in this
Agreement.
 
(d)           Lender shall furnish or cause to be furnished to Borrower, without
charge, an annual accounting of each Reserve Account in the normal format of
Lender or its loan servicer, showing credits and debits to such Reserve Account
and the purpose for which each debit to each Reserve Account was made.
 
(e)           As long as no Event of Default has occurred, Lender shall make
disbursements from the Reserve Accounts in accordance with this Agreement.  All
such disbursements shall be deemed to have been expressly pre-authorized by
Borrower, and shall not be deemed to constitute the exercise by Lender of any
remedies against Borrower unless an Event of Default has occurred and is
continuing and Lender has expressly stated in writing its intent to proceed to
exercise its remedies as a secured party, pledgee or lienholder with respect to
the Reserve Accounts.
 
 
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(f)           If any Event of Default occurs, Borrower shall immediately lose
all of its rights to receive disbursements from the Reserve Accounts until the
earlier to occur of (i) the date on which such Event of Default is cured to
Lender’s satisfaction, or (ii) the payment in full of the Debt.  In addition, at
Lender's election, Borrower shall lose all of its rights to receive interest on
the interest-bearing Reserve Accounts during the occurrence and continuance of
an Event of Default. Upon the occurrence of any Event of Default, Lender may
exercise any or all of its rights and remedies as a secured party, pledgee and
lienholder with respect to the Reserve Accounts.  Without limitation of the
foregoing, upon any Event of Default, Lender may use and disburse the Reserve
Funds (or any portion thereof) for any of the following purposes: (A) repayment
of the Debt, including, but not limited to, principal prepayments and the
prepayment premium applicable to such full or partial prepayment (as
applicable); (B) reimbursement of Lender for all losses, fees, costs and
expenses (including, without limitation, reasonable legal fees) suffered or
incurred by Lender as a result of such Event of Default; (C) payment of any
amount expended in exercising any or all rights and remedies available to Lender
at law or in equity or under this Agreement or under any of the other Loan
Documents; (D) payment of any item from any of the Reserve Accounts as required
or permitted under this Agreement; or (E) any other purpose permitted by
applicable law; provided, however, that any such application of funds shall not
cure or be deemed to cure any Event of Default.  Without limiting any other
provisions hereof, each of the remedial actions described in the immediately
preceding sentence shall be deemed to be a commercially reasonable exercise of
Lender's rights and remedies as a secured party with respect to the Reserve
Funds and shall not in any event be deemed to constitute a setoff or a
foreclosure of a statutory banker's lien.  Nothing in this Agreement shall
obligate Lender to apply all or any portion of the Reserve Funds to effect a
cure of any Event of Default, or to pay the Debt, or in any specific order of
priority.  The exercise of any or all of Lender's rights and remedies under this
Agreement or under any of the other Loan Documents shall not in any way
prejudice or affect Lender's right to initiate and complete a foreclosure under
the Mortgage.
 
(g)           The Reserve Funds shall not constitute escrow or trust funds and
may be commingled with other monies held by Lender.  Notwithstanding anything
else herein to the contrary, Lender may commingle in one or more Eligible
Accounts any and all funds controlled by Lender, including, without limitation,
funds pledged in favor of Lender by other borrowers, whether for the same
purposes as the Reserve Accounts or otherwise; provided, however, such
commingling by Lender shall not constitute a default by Borrower pursuant to the
Section of Section 6.1 hereof.  Without limiting any other provisions of this
Agreement or any other Loan Document, the Reserve Accounts may be established
and held in such name or names as Lender or its loan servicer, as agent for
Lender, shall deem appropriate, including, without limitation, in the name of
Lender or such loan servicer as agent for Lender.  In the case of any Reserve
Account which is held in a commingled account, Lender or its loan servicer, as
applicable, shall maintain records sufficient to enable it to determine at all
times which portion of such account is related to the Loan.  The Reserve
Accounts are solely for the protection of Lender to be used in accordance with
the terms hereof.  With respect to the Reserve Accounts, Lender shall have no
responsibility beyond the allowance of due credit for the sums actually received
by Lender or beyond the reimbursement or payment of the costs and expenses for
which such accounts were established in accordance with their terms.  Upon
assignment of the Loan by Lender, any Reserve Funds shall be turned over to the
assignee and any responsibility of Lender as assignor shall terminate.  The
requirements of this Agreement concerning the Reserve Accounts in no way
supersede, limit or waive any other rights or obligations of the parties under
any of the Loan Documents or under applicable law.
 
 
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(h)           Borrower shall not, without obtaining the prior written consent of
Lender, further pledge, assign or grant any security interest in the Reserve
Accounts or the Reserve Funds deposited therein or permit any Lien to attach
thereto, except for the security interest granted in this Section 9.9, or any
levy to be made thereon, or any UCC Financing Statements, except those naming
Lender as the secured party, to be filed with respect thereto.
 
(i)            Borrower will maintain the security interest created by this
Section 9.9 as a first priority perfected security interest and will defend the
right, title and interest of Lender in and to the Reserve Accounts and the
Reserve Funds against the claims and demands of all Persons whomsoever.  At any
time and from time to time, upon the written request of Lender, and at the sole
expense of Borrower, Borrower will promptly and duly execute and deliver such
further instruments and documents and will take such further actions as Lender
reasonably may request for the purpose of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein granted.
 
(j)            Lender shall be protected in acting upon any notice, resolution,
request, consent, order, certificate, report, opinion, bond or other paper,
document or signature believed by Lender to be genuine, and it may be assumed
conclusively that any Person purporting to give any of the foregoing in
connection with the Reserve Account’s has been duly authorized to do so.  Lender
may consult with counsel, and the opinion of such counsel shall be full and
complete authorization and protection in respect of any action taken or suffered
by them hereunder and in good faith in accordance therewith.  Lender shall not
be liable to Borrower for any act or omission done or omitted to be done by
Lender in reliance upon any instruction, direction or certification received by
Lender and without gross negligence or willful misconduct.
 
(k)           Beyond the exercise of reasonable care in the custody thereof,
Lender shall have any duty as to any Reserve Funds in its possession or control
as agent therefor or bailee thereof or any income thereon or the preservation of
rights against any person or otherwise with respect thereto.  In no event shall
Lender or its Affiliates, agents, employees or bailees, be liable or responsible
for any loss or damage to any of the Reserve Funds, or for any diminution in
value thereof, by reason of the act or omission of Lender, except to the extent
that such loss or damage results from Lender’s gross negligence or willful
misconduct or intentional nonperformance by Lender of its obligations under this
Agreement.
 
ARTICLE 10
CASH MANAGEMENT
 
Section 10.1                      Lockbox Account and Cash Management Account
 
(a)           Borrower acknowledges and confirms that Borrower has established,
and Borrower covenants that it shall maintain, pursuant to the Lockbox
Agreement, a non-interest bearing Eligible Account into which Borrower shall,
and shall cause Manager to, deposit or cause to be deposited, all Rents and
other revenue from the Property (such account, all funds at any time on deposit
therein and any proceeds, replacements or substitutions of such account or funds
therein, are collectively referred to herein as the “Lockbox Account”).  In the
event Lockbox Bank ceases to qualify as an Eligible Institution, Borrower shall
cooperate with Lender in designating a successor financial institution that
meets such qualifications and is otherwise acceptable to Lender and transferring
the Lockbox Account to such institution, each within thirty (30) days after
request by Lender.  In the event Borrower fails to do so, Lender shall have the
right, and Borrower hereby grants to Lender a power of attorney (which power of
attorney shall be coupled with an interest and irrevocable so long as any
portion of the Debt remains outstanding), to designate a successor institution
to serve as Lockbox Bank.
 
 
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(b)           Simultaneously herewith, Lender shall establish a non-interest
bearing Eligible Account into which funds in the Lockbox Account shall be
transferred pursuant to the terms of Section 10.2(b) hereof (such account, the
sub-accounts thereof, all funds at any time on deposit therein and any proceeds,
replacements or substitutions of such account or funds therein, are collectively
referred to herein as the “Cash Management Account”).  The following subaccounts
of the Cash Management Account shall be established and maintained on a
ledger-entry basis:
 
(i)            A subaccount into which amounts required to be deposited into the
Tax and Insurance Reserve Account pursuant to Section 9.6 hereof (the “Tax and
Insurance Reserve Subaccount”) shall be allocated;
 
(ii)           A subaccount into which amounts required to be paid by Borrower
pursuant to Lockbox Bank or Lender pursuant to Section 10.1(e) hereof (the
“Account Maintenance Subaccount”) shall be allocated;
 
(iii)          A subaccount into which the Monthly Payment Amount and other
amounts required to be paid to Lender pursuant to the Note, this Agreement and
the other Loan Documents (the “Debt Service Subaccount”) shall be allocated;
 
(iv)          A subaccount into which amounts required to be deposited into the
Replacement Reserve Account pursuant to Section 9.2 hereof (the “Replacement
Reserve Subaccount”) shall be allocated;
 
(v)           A subaccount into which amounts required to be deposited into the
Leasing Reserve Account pursuant to Section 9.3 hereof (the “Leasing Reserve
Subaccount”) shall be allocated;
 
(vi)          A subaccount into which amounts required to be paid to Borrower
for Operating Expenses pursuant to Section 9.7(b) hereof (the “Operating Expense
Subaccount”) shall be allocated;
 
(vii)         A subaccount into which amounts required to be paid to Borrower
for Extraordinary Expenses pursuant to Section 9.7(b) hereof (the “Extraordinary
Expense Subaccount”) shall be allocated;
 
(viii)        A subaccount into which all Excess Cash required to be deposited
into the Excess Cash Reserve Account pursuant to Section 9.7(a) hereof (the
“Excess Cash Subaccount”) shall be allocated; and
 
(ix)           A subaccount into which all amounts required to be paid to
Borrower after application of all disbursements required pursuant to Section
10.2(c) hereof (the “Borrower Subaccount”) shall be allocated.
 
 
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(c)           The Lockbox Account and Cash Management Account shall each be in
the name of Borrower for the benefit of Lender, provided that Borrower shall be
the owner of all funds on deposit in such accounts for federal and applicable
state and local tax purposes.  Sums on deposit in the Cash Management Account
shall not be invested except in such Permitted Investments as determined and
directed by Lender and all income earned thereon shall be the income of Borrower
and be applied to and become part of the Cash Management Account, to be
disbursed in accordance with this Article 10.  Neither Lockbox Bank nor Lender
shall have any liability for any loss resulting from the investment of funds in
Permitted Investments in accordance with the terms and conditions of this
Agreement.
 
(d)           The Lockbox Account and Cash Management Account shall be subject
to the exclusive dominion and control of Lender and, except as otherwise
expressly provided herein, neither Borrower, Manager nor any other party
claiming on behalf of, or through, Borrower or Manager, shall have any right of
withdrawal therefrom or any other right or power with respect thereto.
 
(e)           Borrower agrees to pay the reasonable and customary fees, expenses
and charges (which fees, expenses and charges shall be subject to change from
time to time) of (i) Lockbox Bank in connection with administering and
maintaining the Lockbox Account and processing all items for payment therefrom,
and (ii) Lender in connection with administering and maintaining the Cash
Management Account and processing all distributions therefrom.
 
(f)           Lender shall be responsible for the performance only of such
duties with respect to the Cash Management Account as are specifically set forth
herein, and no duty shall be implied from any provision hereof.  Lender shall
not be under any obligation or duty to perform any act which would involve it in
expense or liability or to institute or defend any suit in respect hereof, or to
advance any of its own monies.  Borrower shall indemnify and hold Lender and its
directors, employees, officers and agents harmless from and against any loss,
cost or damage (including, without limitation, reasonable attorneys’ fees and
disbursements) incurred by such parties in connection with the Cash Management
Account other than such as result from the gross negligence or willful
misconduct of Lender or intentional nonperformance by Lender of its obligations
under this Agreement.
 
Section 10.2                      Deposits and Withdrawals
 
(a)           Borrower represents, warrants and covenants that:
 
(i)           Concurrently with the execution of this Agreement, Borrower shall
notify and advise each Tenant under each Lease in effect as of the date hereof
and Borrower shall notify and advise each Tenant under any Lease executed after
the date hereof to send directly to the Lockbox all payments of Rents or any
other item payable under such Leases pursuant to an instruction letter in the
form of Exhibit B attached hereto (a “Tenant Direction Letter”).  If Borrower
fails to provide any such notice (and without prejudice to Lender’s rights with
respect to such default), Lender shall have the right, and Borrower hereby
grants to Lender a power of attorney (which power of attorney shall be coupled
with an interest and irrevocable so long as any portion of the Debt remains
outstanding), to sign and deliver a Tenant Direction Letter;
 
 
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(ii)           Borrower shall, and shall cause Manager to, instruct all Persons
that maintain open accounts with Borrower or Manager with respect to the
Property or with whom Borrower or Manager does business on an “accounts
receivable” basis with respect to the Property to deliver all payments due under
such accounts to the Lockbox.  Neither Borrower nor Manager shall direct any
such Person to make payments due under such accounts in any other manner;
 
(iii)           All Rents or other income from the Property shall (A) be deemed
additional security for payment of the Debt and shall be held in trust for the
benefit, and as the property, of Lender, (B) not be commingled with any other
funds or property of Borrower or Manager, and (C) if received by Borrower or
Manager notwithstanding the delivery of a Tenant Direction Letter, be deposited
in the Lockbox Account within one (1) Business Day of receipt;
 
(iv)           Without the prior written consent of Lender, so long as any
portion of the Debt remains outstanding, neither Borrower nor Manager shall
terminate, amend, revoke or modify any Tenant Direction Letter in any manner
whatsoever or direct or cause any Tenant to pay any amount in any manner other
than as provided in the related Tenant Direction Letter; and
 
(v)            So long as any portion of the Debt remains outstanding, neither
Borrower, Manager nor any other Person shall open or maintain any accounts other
than the Lockbox Account into which revenues from the ownership and operation of
the Property are deposited.  The foregoing shall not prohibit Borrower from
utilizing one or more separate accounts for the disbursement or retention of
funds that have been transferred to Borrower pursuant to the express terms of
this Agreement.
 
(b)           Borrower hereby irrevocably authorizes Lender to instruct Lockbox
Bank to transfer, or cause to be transferred, on each Business Day by wire
transfer or other method of transfer mutually agreeable to Lockbox Bank and
Lender of immediately available funds, all collected and available balances in
the Lockbox Account (subject to any minimum retained or “peg” balance that may
be required pursuant to the terms of the Lockbox Agreement) to the Cash
Management Account to be held until disbursed by Lender pursuant to Section
10.2(d).
 
(c)           Provided no Event of Default shall have occurred and be
continuing, on or before each Scheduled Payment Date Lender shall apply all
funds on deposit in the Cash Management Account to the following subaccounts of
the Cash Management Account in the following amounts and order of priority:
 
(i)           First, to the Tax and Insurance Reserve Subaccount, in an amount
up to the monthly deposit to the Tax and Insurance Reserve Account due on the
next Scheduled Payment Date;
 
 
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(ii)           Second, to the Account Maintenance Subaccount, up to the amount
due and payable by Borrower to Lockbox Bank or Lender pursuant to Section
10.1(e) hereof;
 
(iii)          Third, to the Debt Service Subaccount, in an amount up to the
Monthly Payment Amount due on the next Scheduled Payment Date;
 
(iv)          Fourth, to the Replacement Reserve Subaccount, in an amount up to
the Replacement Reserve Monthly Deposit due on the next Scheduled Payment Date;
 
(v)           Fifth, to the Leasing Reserve Subaccount, in an amount up to the
Leasing Reserve Monthly Deposit due on the next Scheduled Payment Date and any
Termination Fee Deposit due;
 
(vi)          Sixth, to the Debt Service Subaccount, in an amount up to any
interest accruing at the Default Rate, late payment charges, and any other sums
due and payable to Lender under the Note, this Agreement or the other Loan
Documents;
 
(vii)         Seventh, during the continuation of a Cash Sweep Period, to the
Operating Expense Subaccount, up to the amount approved pursuant to Section
9.7(b) for disbursement to Borrower for Operating Expenses on the next Scheduled
Payment Date;
 
(viii)        Eighth, during the continuation of a Cash Sweep Period, to the
Extraordinary Expense Subaccount, up to the amount approved pursuant to Section
9.7(b) for disbursement to Borrower for Extraordinary Expenses on the next
Scheduled Payment Date; and
 
(ix)           Ninth, during the continuation of a Cash Sweep Period, to the
Excess Cash Subaccount, otherwise to the Borrower Subaccount, all amounts
remaining in the Cash Management Account after all prior allocations under this
Section 10.2(c) (the “Excess Cash”).
 
(d)           Provided no Event of Default shall have occurred and be
continuing, on each Scheduled Payment Date (and if such day is not a Business
Day, then the immediately preceding day which is a Business Day) commencing the
month during which the first Scheduled Payment Date occurs, Borrower hereby
irrevocably authorizes Lender to withdraw all funds on deposit in the Cash
Management Account and disburse such funds as follows:
 
(i)            Funds on deposit in the Tax and Insurance Reserve Subaccount, to
Lender for deposit into the Tax and Insurance Reserve Account to be held and
disbursed in accordance with Section 9.6;
 
(ii)           Funds on deposit in the Account Maintenance Subaccount, to
Lockbox Bank or Lender, as applicable, for amounts payable pursuant to Section
10.1(e);
 
(iii)          Funds on deposit in the Debt Service Subaccount, to Lender for
payment of the Monthly Payment Amount due on such Scheduled Payment Date
together with any interest accruing at the Default Rate, late payment charges,
and any other sums due and payable to Lender under the Note, this Agreement or
the other Loan Documents;
 
 
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(iv)          Funds on deposit in the Replacement Reserve Subaccount, to Lender
for deposit into the Replacement Reserve Account to be held and disbursed in
accordance with Section 9.5;
 
(v)           Funds on deposit in the Leasing Reserve Subaccount, to Lender for
deposit into the Leasing Reserve Account to be held and disbursed in accordance
with Section 9.5;
 
(vi)          During the continuation of a Cash Sweep Period, funds on deposit
in the Operating Expense Subaccount, to Borrower’s Account for payment of
Operating Expenses for such month pursuant to Section 9.7(b);
 
(vii)         During the continuation of a Cash Sweep Period, funds on deposit
in the Extraordinary Expense Subaccount, to Borrower’s Account for payment of
Extraordinary Expenses for such month pursuant to Section 9.7(b);
 
(viii)        During the continuation of a Cash Sweep Period, funds on deposit
in the Excess Cash Subaccount, to Lender for deposit into the Excess Cash
Reserve Account to be held and disbursed in accordance with Section 9.7(a); and
 
(ix)           Funds on deposit in the Borrower Subaccount, to Borrower’s
Account.
 
(e)           Notwithstanding anything to the contrary herein, Borrower
acknowledges that Borrower is responsible for monitoring the sufficiency of
funds deposited in the Cash Management Account and that Borrower is liable for
any deficiency in available funds, irrespective of whether Borrower has received
any account statement, notice or demand from Lender or Lender’s servicer.  If
the amount on deposit in the Cash Management Account is insufficient to allocate
the full amounts required pursuant to Section 10.2(c)(i) through (vi) above,
Borrower shall deposit such deficiency into the Cash Management Account within
five (5) days (provided that such five day period shall not constitute a grace
period for any default or Event of Default under this Agreement or any other
Loan Document based on a failure to satisfy any monetary obligation provided in
any Loan Document).
 
(f)           If an Event of Default shall have occurred and be continuing,
Borrower hereby irrevocably authorizes Lender to make any and all withdrawals
from the Lockbox Account and Cash Management Account and transfers between any
of the Reserve Accounts as Lender shall determine in Lender’s sole and absolute
discretion and Lender may use all funds contained in any such accounts for any
purpose, including but not limited to repayment of the Debt in such order,
proportion and priority as Lender may determine in its sole and absolute
discretion.  Lender’s right to withdraw and apply funds as stated herein shall
be in addition to all other rights and remedies provided to Lender under this
Agreement, the Note, the Mortgage and the other Loan Documents.
 
 
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Section 10.3                      Security Interest
 
(a)           To secure the full and punctual payment of the Debt and
performance of all obligations of Borrower now or hereafter existing under this
Agreement and the other Loan Documents, Borrower hereby grants to Lender a
first-priority perfected security interest in the Lockbox Account and Cash
Management Account, all interest, cash, checks, drafts, certificates and
instruments, if any, from time to time deposited or held therein, any and all
amounts invested in Permitted Investments, and all “proceeds” (as defined in the
UCC as in effect in the state in which the Lockbox Account and Cash Management
Account are located or maintained) of any or all of the foregoing.  Furthermore,
Borrower shall not, without obtaining the prior written consent of Lender,
further pledge, assign or grant any security interest in any of the foregoing or
permit any Lien to attach thereto or any levy to be made thereon or any UCC
Financing Statements to be filed with respect thereto.  Borrower will maintain
the security interest created by this Section 10.3(a) as a first priority
perfected security interest and will defend the right, title and interest of
Lender in and to the Lockbox Account and Cash Management Account against the
claims and demands of all Persons whomsoever.
 
(b)           Borrower authorizes Lender to file any financing statement or
statements required by Lender to establish or maintain the validity, perfection
and priority of the security interest granted herein in connection with the
Lockbox Account and Cash Management Account.  Borrower  agrees that at any time
and from time to time, at the expense of Borrower, Borrower will promptly and
duly execute and deliver all further instruments and documents, and take all
further action, that may be necessary or desirable, or that Lender may
reasonably request, in order to perfect and protect any security interest
granted or purported to be granted hereby (including, without limitation, any
security interest in and to any Permitted Investments) or to enable Lender to
exercise and enforce its rights and remedies hereunder.
 
(c)           Upon the occurrence of an Event of Default, Lender may exercise
any or all of its rights and remedies as a secured party, pledgee and lienholder
with respect to the Lockbox Account and Cash Management Account.  Without
limitation of the foregoing, upon any Event of Default, Lender may use the
Lockbox Account and Cash Management Account for any of the following purposes:
(A) repayment of the Debt, including, but not limited to, principal prepayments
and the prepayment premium applicable to such full or partial prepayment (as
applicable); (B) reimbursement of Lender for all losses, fees, costs and
expenses (including, without limitation, reasonable legal fees) suffered or
incurred by Lender as a result of such Event of Default; (C) payment of any
amount expended in exercising any or all rights and remedies available to Lender
at law or in equity or under this Agreement or under any of the other Loan
Documents; (D) payment of any item as required or permitted under this
Agreement; or (E) any other purpose permitted by applicable law; provided,
however, that any such application of funds shall not cure or be deemed to cure
any Event of Default.  Without limiting any other provisions hereof, each of the
remedial actions described in the immediately preceding sentence shall be deemed
to be a commercially reasonable exercise of Lender's rights and remedies as a
secured party with respect to the Lockbox Account and Cash Management Account
and shall not in any event be deemed to constitute a setoff or a foreclosure of
a statutory banker's lien.  Nothing in this Agreement shall obligate Lender to
apply all or any portion of the Lockbox Account or Cash Management Account to
effect a cure of any Event of Default, or to pay the Debt, or in any specific
order of priority.  The exercise of any or all of Lender's rights and remedies
under this Agreement or under any of the other Loan Documents shall not in any
way prejudice or affect Lender's right to initiate and complete a foreclosure
under the Mortgage.
 
 
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(d)           Notwithstanding anything to the contrary contained herein, For
purposes of this Article 10 only, “Business Day” shall mean a day on which
Lender and Lockbox Bank are both open for the conduct of substantially all of
their respective banking business at the office in the city in which the Note is
payable, with respect to Lender, and at the office in the city where the Lockbox
Account is maintained, with respect to Lockbox Bank (in both instances,
excluding Saturdays and Sundays).
 
ARTICLE 11
EVENTS OF DEFAULT; REMEDIES
 
Section 11.1                      Event of Default
 
The occurrence of any one or more of the following events shall constitute an
“Event of Default”:
 
(a)           if any portion of the Debt is not paid prior to the fifth (5th)
day following the date the same is due or if the entire Debt is not paid on or
before the Maturity Date;
 
(b)           except as otherwise expressly provided in the Loan Documents, if
any of the Taxes or Other Charges are not paid when the same are due and
payable, unless there is sufficient money in the Tax and Insurance Reserve
Account for payment of amounts then due and payable and Lender’s access to such
money has not been constrained or restricted in any manner;
 
(c)           if (i) the Policies are not kept in full force and effect, (ii)
the Acord  28 (or similar) certificate is not delivered to Lender in accordance
with Section 8.1 or (iii) certified copies of the Policies are not delivered to
Lender upon request, provided such copies are available;
 
(d)           if Borrower is in material breach of any covenant with respect to
itself or any SPE Component Entity (if any) contained in Article 6 or any
covenant contained in Article 7 hereof;
 
(e)           if any representation or warranty of, or with respect to,
Borrower, Borrower Principal, any SPE Component Entity, or any member, general
partner, principal or beneficial owner of any of the foregoing, made herein, in
any other Loan Document, or in any certificate, report, financial statement or
other instrument or document furnished to Lender at the time of the closing of
the Loan or during the term of the Loan shall have been false or misleading in
any material respect when made;
 
(f)           if (i) Borrower, or any managing member or general partner of
Borrower, Borrower Principal, or any SPE Component Entity (if any) shall
commence any case, proceeding or other action (A) under any Creditors Rights
Laws, seeking to have an order for relief entered with respect to it, or seeking
to adjudicate it a bankrupt or insolvent, or seeking reorganization, or (B)
seeking appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets, or
Borrower, any managing member or general partner of Borrower, Borrower
Principal, or any SPE Component Entity (if any) shall make a general assignment
for the benefit of its creditors; or (ii) there shall be commenced against
Borrower, any managing member or general partner of Borrower, Borrower
Principal, or any SPE Component Entity (if any) any case, proceeding or other
action of a nature referred to in clause (i) above which (A) results in the
entry of an order for relief or any such adjudication or appointment or (B)
remains undismissed, undischarged or unbonded for a period of sixty (60) days;
or (iii) there shall be commenced against Borrower, any managing member or
general partner of Borrower, Borrower Principal, or any SPE Component Entity (if
any) any case, proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of its assets which results in the entry of any order for any
such relief which shall not have been vacated, discharged, or stayed or bonded
pending appeal within sixty (60) days from the entry thereof; or (iv) Borrower,
any managing member or general partner of Borrower, Borrower Principal, or any
SPE Component Entity (if any) shall take any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the acts set
forth in clause (i), (ii), or (iii) above; or (v) Borrower, any managing member
or general partner of Borrower, Borrower Principal, or any SPE Component Entity
(if any) shall generally not, or shall be unable to, or shall admit in writing
its inability to, pay its debts as they become due;
 
 
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(g)           if Borrower shall be in default beyond applicable notice and grace
periods under any other mortgage, deed of trust, deed to secure debt or other
security agreement covering any part of the Property, whether it be superior or
junior in lien to the Mortgage;
 
(h)           if the Property becomes subject to any mechanic’s, materialman’s
or other Lien other than a Lien for any Taxes or Other Charges not then due and
payable and the Lien shall remain undischarged of record (by payment, bonding or
otherwise) for a period of ninety (90) days;
 
(i)           if any federal tax lien is filed against Borrower, any member or
general partner of Borrower, Borrower Principal, or any SPE Component Entity (if
any) or the Property and same is not discharged of record within thirty (30)
days after same is filed;
 
(j)           if a judgment is filed against Borrower in excess of $100,000
which is not vacated, discharged or bonded within thirty (30) days but only with
respect to judgments that are not covered by the insurance maintained by
Borrower pursuant to the terms of this Agreement;
 
(k)           if any default occurs under any guaranty or indemnity executed in
connection herewith and such default continues after the expiration of
applicable grace periods, if any;
 
(l)           if Borrower shall permit any event within its control to occur
that would cause any REA to terminate without notice or action by any party
thereto or would entitle any party to terminate any REA and the term thereof by
giving notice to Borrower; or any REA shall be surrendered, terminated or
canceled for any reason or under any circumstance whatsoever except as provided
for in such REA; or any term of any REA shall be modified or supplemented
without Lender’s prior written consent; or Borrower shall fail, within ten (10)
Business Days after demand by Lender, to exercise its option to renew or extend
the term of any REA or shall fail or neglect to pursue diligently all actions
necessary to exercise such renewal rights pursuant to such REA except as
provided for in such REA
 
 
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(m)          if any Letter of Credit is not renewed, replaced or substituted
with cash in accordance with the terms hereof at least thirty (30) days prior to
the expiration date of such Letter of Credit;
 
(n)           in the event that the long term credit rating of the Issuing Bank
falls below the Minimum L/C Rating and Borrower fails to deliver to Lender
within fifteen (15) Business Days cash into the respective Reserve Account or a
Letter of Credit in an amount equal to the amount of the Letter of Credit being
replaced from an Issuing Bank having a credit rating of no less than the Minimum
L/C Rating; or
 
(o)           if Borrower shall continue to be in default under any other term,
covenant or condition of this Agreement or any of the Loan Documents for more
than ten (10) days after notice from Lender in the case of any default which can
be cured by the payment of a sum of money or for thirty (30) days after notice
from Lender in the case of any other default, provided that if such default
cannot reasonably be cured within such thirty (30) day period and Borrower 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 so long as it shall require Borrower in
the exercise of due diligence to cure such default, it being agreed that no such
extension shall be for a period in excess of sixty (60) days.
 
Section 11.2                      Remedies
 
(a)           Upon the occurrence of an Event of Default (other than an Event of
Default described in Section 11.1(f) above) and at any time thereafter Lender
may, in addition to any other rights or remedies available to it pursuant to
this Agreement and the other Loan Documents or at law or in equity, take such
action, without notice or demand, that Lender deems advisable to protect and
enforce its rights against Borrower and in the Property, including, without
limitation, declaring the Debt to be immediately due and payable, and Lender may
enforce or avail itself of any or all rights or remedies provided in the Loan
Documents against Borrower and the Property, including, without limitation, all
rights or remedies available at law or in equity; and upon any Event of Default
described in Section 11.1(f) above, the Debt and all other obligations of
Borrower hereunder and under the other Loan Documents shall immediately and
automatically become due and payable, without notice or demand, and Borrower
hereby expressly waives any such notice or demand, anything contained herein or
in any other Loan Document to the contrary notwithstanding.
 
(b)           Upon the occurrence of an Event of Default, all or any one or more
of the rights, powers, privileges and other remedies available to Lender against
Borrower under this Agreement or any of the other Loan Documents executed and
delivered by, or applicable to, Borrower or at law or in equity may be exercised
by Lender at any time and from time to time, whether or not all or any of the
Debt shall be declared due and payable, and whether or not Lender 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 the
Property.  Any such actions taken by Lender shall be cumulative and concurrent
and may be pursued independently, singularly, successively, together or
otherwise, at such time and in such order as Lender may determine in its sole
discretion, to the fullest extent permitted by law, without impairing or
otherwise affecting the other rights and remedies of Lender permitted by law,
equity or contract or as set forth herein or in the other Loan Documents.
 
 
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Section 11.3                      Provisions Regarding Letters of Credit
 
(a)           Any Letter of Credit delivered under this Agreement shall be
additional security for the payment of the Debt.  Upon the occurrence and
continuance of an Event of Default, Lender shall have the right, at its option,
to draw on any such Letter of Credit and to apply all or any part thereof to
payment of the Debt in such order, proportion or priority as Lender may
determine.  On the Maturity Date if the Debt is not paid in full, any such
Letter of Credit may be applied to reduce the Debt.
 
(b)           In addition to any other right Lender may have to draw upon a
Letter of Credit pursuant to the terms and conditions of this Agreement, Lender
shall have the additional rights to draw in full on any Letter of Credit: (i) if
Lender has received a notice from the Issuing Bank that the Letter of Credit
will not be renewed and a substitute Letter of Credit in the amount of the
Letter of Credit is not provided at least thirty (30) days prior to the date on
which the outstanding Letter of Credit is scheduled to expire; (ii) upon receipt
of notice from the Issuing Bank that the Letter of Credit will be terminated; or
(iii) if the Issuing Bank shall cease to satisfy the Minimum L/C Rating and
Borrower fails to deliver cash into the respective Reserve Account or a
substitute Letter of Credit in the amount of the Letter of Credit within fifteen
(15) Business Days of such event.  Notwithstanding anything to the contrary
contained in the above, Lender is not obligated to draw down on any Letter of
Credit upon the happening of an event specified in (i), (ii) or (iii) above and
shall not be liable for any losses sustained by Borrower due to the insolvency
of the Issuing Bank if Lender has not drawn the Letter of Credit and in the
event of the insolvency of the Issuing Bank or if the Issuing Bank ceases to
satisfy the Minimum L/C Rating, Borrower shall provide to Lender within the time
frames set forth above substitute Letter of Credit meeting the requirements
hereof.
 
ARTICLE 12
ENVIRONMENTAL PROVISIONS
 
Section 12.1                      Environmental Representations and Warranties
 
Borrower represents and warrants, based upon an Environmental Report of the
Property and information that Borrower knows or should reasonably have known,
that:  (a) there are no Hazardous Materials or underground storage tanks in, on,
or under the Property, except those that are both (i) in compliance with
Environmental Laws and with permits issued pursuant thereto (if such permits are
required), if any, and (ii) either (A) in the case of Hazardous Materials, in
amounts not in excess of that necessary to operate the Property for the purposes
set forth herein or (B) fully disclosed to and approved by Lender in writing
pursuant to an Environmental Report; (b) there are no past, present or
threatened Releases of Hazardous Materials in violation of any Environmental Law
or which would require remediation by a Governmental Authority in, on, under or
from the Property except as described in the Environmental Report; (c) there is
no threat of any Release of Hazardous Materials migrating to the Property except
as described in the Environmental Report; (d) there is no past or present
non-compliance with Environmental Laws, or with permits issued pursuant thereto,
in connection with the Property except as described in the Environmental Report;
(e) Borrower does not know of, and has not received, any written or oral notice
or other communication from any Person relating to Hazardous Materials in, on,
under or from the Property; (f) the Property is free of Mold; and (g) Borrower
has truthfully and fully provided to Lender, in writing, any and all information
relating to environmental conditions in, on, under or from the Property known to
Borrower or contained in Borrower’s files and records, including but not limited
to any reports relating to Hazardous Materials in, on, under or migrating to or
from the Property and/or to the environmental condition of or the presence of
Mold at the Property.
 
 
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Section 12.2                      Environmental Covenants
 
Borrower covenants and agrees that so long as Borrower owns, manages, is in
possession of, or otherwise controls the operation of the Property:  (a) all
uses and operations on or of the Property, whether by Borrower or any other
Person, shall be in compliance with all Environmental Laws and permits issued
pursuant thereto; (b) there shall be no Releases of Hazardous Materials in, on,
under or from the Property; (c) there shall be no Hazardous Materials in, on, or
under the Property, except those that are both (i) in compliance with all
Environmental Laws and with permits issued pursuant thereto, if and to the
extent required, and (ii) (A) in amounts not in excess of that necessary to
operate the Property for the purposes set forth herein or (B) fully disclosed to
and approved by Lender in writing or (C) with respect to Mold, not in a
condition, location, or of a type which may pose a risk to human health or
safety or the environment or which may result in damage to or would adversely
affect or impair the value or marketability of the Property; (d) Borrower shall
keep the Property free and clear of all Environmental Liens; (e) Borrower shall,
at its sole cost and expense, fully and expeditiously cooperate in all
activities pursuant to Section 12.4 below, including but not limited to
providing all relevant information and making knowledgeable persons available
for interviews; (f) Borrower shall, at its sole cost and expense, perform any
environmental site assessment or other investigation of environmental conditions
in connection with the Property, pursuant to any reasonable written request of
Lender, upon Lender’s reasonable belief that the Property is not in full
compliance with all Environmental Laws, and share with Lender the reports and
other results thereof, and Lender and other Indemnified Parties shall be
entitled to rely on such reports and other results thereof; (g) Borrower shall
keep the Property free of Mold; (h) Borrower shall, at its sole cost and
expense, comply with all reasonable written requests of Lender to (i) reasonably
effectuate remediation of any Hazardous Materials in, on, under or from the
Property; and (ii) comply with any Environmental Law; (i) Borrower shall not
allow any tenant or other user of the Property to violate any Environmental Law;
and (j) Borrower shall immediately notify Lender in writing after it has become
aware of (A) any presence or Release or threatened Release of Hazardous
Materials in, on, under, from or migrating towards the Property; (B) any
non-compliance with any Environmental Laws related in any way to the Property;
(C) any actual or potential Environmental Lien against the Property; (D) any
required or proposed remediation of environmental conditions relating to the
Property; and (E) any written or oral notice or other communication of which
Borrower becomes aware from any source whatsoever (including but not limited to
a Governmental Authority) relating in any way to Hazardous Materials.  Any
failure of Borrower to perform its obligations pursuant to this Section 12.2
shall constitute bad faith waste with respect to the Property.
 
Section 12.3                      Lender’s Rights
 
Lender and any other Person designated by Lender, including but not limited to
any representative of a Governmental Authority, and any environmental
consultant, and any receiver appointed by any court of competent jurisdiction,
shall have the right, but not the obligation, to enter upon the Property at all
reasonable times to assess any and all aspects of the environmental condition of
the Property and its use, including but not limited to conducting any
environmental assessment or audit (the scope of which shall be determined in
Lender’s sole discretion) and taking samples of soil, groundwater or other
water, air, or building materials, and conducting other invasive
testing.  Borrower shall cooperate with and provide access to Lender and any
such person or entity designated by Lender.
 
 
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Section 12.4                      Operations and Maintenance
 
If recommended by the Environmental Report or any other environmental assessment
or audit of the Property,  Borrower shall establish and comply with an
operations and maintenance program with respect to the Property, in form and
substance reasonably acceptable to Lender, prepared by an environmental
consultant reasonably acceptable to Lender, which program shall address any
asbestos-containing material or lead based paint or Mold that may now or in the
future be detected at or on the Property.  Without limiting the generality of
the preceding sentence, Lender may require (a) periodic notices or reports to
Lender in form, substance and at such intervals as Lender may specify, (b) an
amendment to such operations and maintenance program to address changing
circumstances, laws or other matters, (c) at Borrower’s sole expense,
supplemental examination of the Property by consultants specified by Lender, (d)
access to the Property by Lender, its agents or servicer, to review and assess
the environmental condition of the Property and Borrower’s compliance with any
operations and maintenance program, and (e) variation of the operations and
maintenance program in response to the reports provided by any such consultants.
 
Section 12.5                      Environmental Definitions
 
“Environmental Law” means any present and future federal, state and local laws,
statutes, ordinances, rules, regulations, standards, policies and other
government directives or requirements, as well as common law, including but not
limited to the Comprehensive Environmental Response, Compensation and Liability
Act and the Resource Conservation and Recovery Act, that apply to Borrower or
the Property and relate to Hazardous Materials or protection of human health or
the environment.  “Environmental Liens” means all Liens and other encumbrances
imposed pursuant to any Environmental Law, whether due to any act or omission of
Borrower or any other Person.  “Environmental Report” means the written reports
resulting from the environmental site assessments of the Property delivered to
Lender in connection with the Loan.  “Hazardous Materials” shall mean petroleum
and petroleum products and compounds containing them, including gasoline, diesel
fuel and oil; explosives, flammable materials; radioactive materials;
polychlorinated biphenyls and compounds containing them; lead and lead-based
paint; asbestos or asbestos-containing materials in any form that is or could
become friable; underground or above-ground storage tanks, whether empty or
containing any substance; any substance the presence of which on the Property is
prohibited by any federal, state or local authority; any substance that requires
special handling; and any other material or substance now or in the future
defined as a “hazardous substance,” “hazardous material”, “hazardous waste”,
“toxic substance”, “toxic pollutant”, “contaminant”, or “pollutant” within the
meaning of any Environmental Law.  “Mold” shall mean any mold, fungi, bacterial
or microbial matter present at or in the Property, including, without
limitation, building materials which is in a condition, location or a type which
may pose a risk to human health or safety or the environment, may result in
damage to or would adversely affect or impair the value or marketability of the
Property.  “Release” of any Hazardous Materials includes but is not limited to
any release, deposit, discharge, emission, leaking, spilling, seeping,
migrating, injecting, pumping, pouring, emptying, escaping, dumping, disposing
or other movement of Hazardous Materials.
 
 
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Section 12.6                      Indemnification
 
(a)           Borrower and Borrower Principal covenant and agree at their sole
cost and expense, to protect, defend, indemnify, release and hold Indemnified
Parties harmless from and against any and all Losses imposed upon or incurred by
or asserted against any Indemnified Parties and directly or indirectly arising
out of or in any way relating to any one or more of the following:  (i) any
presence of any Hazardous Materials in, on, above, or under the Property; (ii)
any past, present or threatened Release of Hazardous Materials in, on, above,
under or from the Property; (iii) any activity by Borrower, any Person
affiliated with Borrower, and any Tenant or other user of the Property in
connection with any actual, proposed or threatened use, treatment, storage,
holding, existence, disposition or other Release, generation, production,
manufacturing, processing, refining, control, management, abatement, removal,
handling, transfer or transportation to or from the Property of any Hazardous
Materials at any time located in, under, on or above the Property or any actual
or proposed remediation of any Hazardous Materials at any time located in,
under, on or above the Property, whether or not such remediation is voluntary or
pursuant to court or administrative order, including but not limited to any
removal, remedial or corrective action; (iv) any past, present or threatened
non-compliance or violations of any Environmental Laws (or permits issued
pursuant to any Environmental Law) in connection with the Property or operations
thereon, including but not limited to any failure by Borrower, any person or
entity affiliated with Borrower, and any tenant or other user of the Property to
comply with any order of any Governmental Authority in connection with any
Environmental Laws; (v) the imposition, recording or filing or the threatened
imposition, recording or filing of any Environmental Lien encumbering the
Property; (vi) any acts of Borrower, any person or entity affiliated with
Borrower, and any tenant or other user of the Property in (A) arranging for
disposal or treatment, or arranging with a transporter for transport for
disposal or treatment, of Hazardous Materials at any facility or incineration
vessel containing such or similar Hazardous Materials or (B) accepting any
Hazardous Materials for transport to disposal or treatment facilities,
incineration vessels or sites from which there is a Release, or a threatened
Release of any Hazardous Substance which causes the incurrence of costs for
remediation; and (vii) any misrepresentation or inaccuracy in any representation
or warranty or material breach or failure to perform any covenants or other
obligations pursuant to this Agreement relating to environmental matters.
 
(b)           Upon written request by any Indemnified Party, Borrower and
Borrower Principal shall defend same (if requested by any Indemnified Party, in
the name of the Indemnified Party) by attorneys and other professionals approved
by the Indemnified Parties.  Notwithstanding the foregoing, any Indemnified
Parties may, in their sole discretion, engage their own attorneys and other
professionals to defend or assist them, and, at the option of Indemnified
Parties, their attorneys shall control the resolution of any claim or
proceeding.  Upon demand, Borrower and Borrower Principal shall pay or, in the
sole discretion of the Indemnified Parties, reimburse, the Indemnified Parties
for the payment of reasonable fees and disbursements of attorneys, engineers,
environmental consultants, laboratories and other professionals in connection
therewith.
 
 
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(c)           Notwithstanding the foregoing, neither Borrower nor Borrower
Principal shall have any liability for any Losses imposed upon or incurred by or
asserted against any Indemnified Parties and described in subsection (a) above
to the extent that Borrower and/or Borrower Principal can conclusively prove
both that such Losses were caused solely by actions, conditions or events that
occurred after the date that Lender (or any purchaser at a foreclosure sale)
actually acquired title to the Property and that such Losses were not caused by
the direct or indirect actions of Borrower, Borrower Principal, or any partner,
member, principal, officer, director, trustee or manager of Borrower or Borrower
Principal or any employee, agent, contractor or Affiliate of Borrower or
Borrower Principal.  The obligations and liabilities of Borrower and Borrower
Principal under this Section 12.6 shall fully survive indefinitely
notwithstanding any termination, satisfaction, assignment, entry of a judgment
of foreclosure, exercise of any power of sale, or delivery of a deed in lieu of
foreclosure of the Mortgage, except that, upon payment in full of the Loan,
Borrower and Borrower Principal shall be released from liability under this
Section 12.6 upon delivery to Lender of an environmental report indicating that
the Property is in compliance with all Environmental Laws and otherwise in form
and substance and from an environmental consultant acceptable to Lender and
dated no earlier than the date on which the Loan is paid in full.
 
ARTICLE 13
SECONDARY MARKET
 
Section 13.1                      Transfer of Loan
 
Lender may, at any time, sell, transfer or assign the Loan Documents, or grant
participations therein (“Participations”) or syndicate the Loan (“Syndication”)
or issue mortgage pass-through certificates or other securities evidencing a
beneficial interest in a rated or unrated public offering or private placement
(“Securities”) (a Syndication or the issuance of Participations and/or
Securities, a “Securitization”).
 
Section 13.2                      Delegation of Servicing
 
At the option of Lender, the Loan may be serviced by a servicer/trustee selected
by Lender and Lender may delegate all or any portion of its responsibilities
under this Agreement and the other Loan Documents to such servicer/trustee
pursuant to a servicing agreement between Lender and such servicer/trustee.
 
Section 13.3                      Dissemination of Information
 
Lender may forward to each purchaser, transferee, assignee, or servicer of, and
each participant, or investor in, the Loan, or any Participations and/or
Securities or any of their respective successors (collectively, the “Investor”)
or any Rating Agency rating the Loan, or any Participations and/or Securities,
each prospective Investor, and any organization maintaining databases on the
underwriting and performance of commercial mortgage loans, all documents and
information which Lender now has or may hereafter acquire relating to the Debt
and to Borrower, any managing member or general partner thereof, Borrower
Principal, any SPE Component Entity (if any) and the Property, including
financial statements, whether furnished by Borrower or otherwise, as Lender
determines necessary or desirable.  Borrower irrevocably waives any and all
rights it may have under applicable Legal Requirements to prohibit such
disclosure, including but not limited to any right of privacy.
 
 
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Section 13.4                      Cooperation
 
In connection with a Securitization, at the request of the holder of the Note
and, to the extent not already required to be provided by Borrower under this
Agreement, Borrower and Borrower Principal shall use reasonable efforts to
provide information not in the possession of the holder of the Note in order to
satisfy the market standards to which the holder of the Note customarily adheres
or which may be reasonably required in the marketplace or by the Rating Agencies
in connection with such sales or transfers, including, without limitation, to:
 
(a)           provide updated financial, budget and other information with
respect to the Property, Borrower and Borrower Principal and provide
modifications and/or updates to the appraisals, market studies, environmental
reviews and reports (Phase I reports and, if appropriate, Phase II reports) and
engineering reports of the Property obtained in connection with the making of
the Loan (all of the foregoing being referred to as the “Provided Information”),
together, if customary, with appropriate verification and/or consents of the
Provided Information through letters of auditors or opinions of counsel of
independent attorneys acceptable to Lender and the Rating Agencies;
 
(b)           make changes to the organizational documents of Borrower, any SPE
Component Entity and their respective principals;
 
(c)           cause counsel to render or update existing opinion letters as to
enforceability and non-consolidation, and a 10b-5 comfort letter, which may be
relied upon by the holder of the Note, the Rating Agencies and their respective
counsel, which shall be dated as of the closing date of the Securitization;
 
(d)           permit site inspections, appraisals, market studies and other due
diligence investigations of the Property, as may be reasonably requested by the
holder of the Note or the Rating Agencies or as may be necessary or appropriate
in connection with the Securitization;
 
(e)           make the representations and warranties with respect to the
Property, Borrower,  Borrower Principal and the Loan Documents as are made in
the Loan Documents and such other representations and warranties as may be
reasonably requested by the holder of the Note or the Rating Agencies;
 
(f)            execute such amendments to the Loan Documents as may be requested
by the holder of the Note or the Rating Agencies or otherwise to effect the
Securitization including, without limitation, bifurcation of the Loan into two
or more components and/or separate notes and/or creating a senior/subordinate
note structure; provided, however, that Borrower shall not be required to modify
or amend any Loan Document if such modification or amendment would (i) change
the interest rate, the stated maturity or the amortization of principal set
forth in the Note, except in connection with a bifurcation of the Loan which may
result in varying fixed interest rates and amortization schedules, but which
shall have the same initial weighted average coupon of the original Note, or
(ii) modify or amend any other material economic term of the Loan, or (iii)
materially increase Borrower’s obligations and liabilities under the Loan
Documents;
 
 
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(g)           deliver to Lender and/or any Rating Agency, (i) one or more
certificates executed by an officer of Borrower certifying as to the accuracy,
as of the closing date of the Securitization, of all representations made by
Borrower in the Loan Documents as of the Closing Date in all relevant
jurisdictions or, if such representations are no longer accurate, certifying as
to what modifications to the representations would be required to make such
representations accurate as of the closing date of the Securitization, and (ii)
certificates of the relevant Governmental Authorities in all relevant
jurisdictions indicating the good standing and qualification of Borrower as of
the date of the closing date of the Securitization;
 
(h)           have reasonably appropriate personnel participate in a bank
meeting and/or presentation for the Rating Agencies or Investors; and
 
(i)            cooperate with and assist Lender in obtaining ratings of the
Securities from two (2) or more of the Rating Agencies; and
 
(j)            supply to Lender such documentation, financial statements and
reports in form and substance required for Lender to comply with Regulations S-X
and AB of the federal securities laws, if applicable.
 
In the event that Borrower requests any consent or approval hereunder and the
provisions of this Agreement or any Loan Documents require the receipt of
written confirmation from each of the Rating Agencies with respect to the
ratings on the Securities, or, in accordance with the terms of the transaction
documents relating to a Securitization, such a rating confirmation is required
in order for the consent of Lender to be given, Borrower shall pay all of the
costs and expenses of Lender, Lender’s servicer and each Rating Agency in
connection therewith, and, if applicable, shall pay any fees imposed by any
Rating Agency as a condition to the delivery of such
confirmation.  Notwithstanding the provisions of this Article 13 to the
contrary, Borrower shall not be obligated to spend more than the Cooperation Cap
in the aggregate in connection with complying with the provisions of this
Article 13, but Borrower shall still be obligated to pay for other costs and
expenses (including, without limitation, it’s own legal fees) in excess of such
limitation.
 
Section 13.5                      Securitization
 
(a)           Borrower and Borrower Principal understand that certain of the
Provided Information may be included in disclosure documents in connection with
the Securitization, including, without limitation, a prospectus, prospectus
supplement, offering memorandum or private placement memorandum (each, a
“Disclosure Document”) and may also be included in filings with the Securities
and Exchange Commission pursuant to the Securities Act or the Exchange Act, or
provided or made available to investors or prospective investors in the
Securities, the Rating Agencies, and service providers relating to the
Securitization.  In the event that the Disclosure Document is required to be
revised prior to the sale of all Securities, Borrower and Borrower Principal
will cooperate with the holder of the Note in updating the Disclosure Document
by providing all current information necessary to keep the Disclosure Document
accurate and complete in all material respects.
 
 
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(b)           Borrower and Borrower Principal agree to provide in connection
with each of (i) a preliminary and a final offering memorandum or private
placement memorandum or similar document (including any Investor or Rating
Agency “term sheets” or presentations relating to the Property and/or the Loan)
or (ii) a preliminary and final prospectus or prospectus supplement, as
applicable, an indemnification certificate (A) certifying that Borrower and
Borrower Principal have carefully examined such memorandum or prospectus or
other document (including any Investor or Rating Agency “term sheets” or
presentations relating to the Property and/or the Loan), as applicable,
including without limitation, the sections entitled “Special Considerations,”
and/or “Risk Factors,” and “Certain Legal Aspects of the Mortgage Loan,” or
similar sections, and all sections relating to Borrower, Borrower Principal,
Manager, their Affiliates, the Loan, the Loan Documents and the Property, and
any risks or special considerations relating thereto, and that, to the best of
Borrower’s knowledge, such sections (and any other sections reasonably
requested) do not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements made, in the
light of the circumstances under which they were made, not misleading, (B)
indemnifying Lender (and for purposes of this Section 13.5, Lender hereunder
shall include its officers and directors) and the Affiliate of Lender that (i)
has filed the registration statement, if any, relating to the Securitization
and/or (ii) which is acting as issuer, depositor, sponsor and/or a similar
capacity with respect to the Securitization (any Person described in (i) or
(ii), an “Issuer Person”), and each director and officer of any Issuer Person,
and each Person or entity who controls any Issuer Person within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act
(collectively, the “Issuer Group”), and each Person which is acting as an
underwriter, manager, placement agent, initial purchaser or similar capacity
with respect to the Securitization, each of its directors and officers and each
Person who controls any such Person within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act (collectively, the
“Underwriter Group”) for any Losses to which Lender, the Issuer Group or the
Underwriter Group may become subject insofar as the Losses arise out of or are
based upon any untrue statement or alleged untrue statement of any material fact
contained in such sections (including any Investor or Rating Agency “term
sheets” or presentations relating to the Property and/or the Loan) or arise out
of or are based upon the omission or alleged omission to state therein a
material fact required to be stated in such sections (including any Investor or
Rating Agency “term sheets” or presentations relating to the Property and/or the
Loan) or necessary in order to make the statements in such sections (including
any Investor or Rating Agency “term sheets” or presentations relating to the
Property and/or the Loan) or in light of the circumstances under which they were
made, not misleading (collectively the “Securities Liabilities”) and (C)
agreeing to reimburse Lender, the Issuer Group and the Underwriter Group for any
legal or other expenses reasonably incurred by Lender and Issuer Group in
connection with investigating or defending the Securities Liabilities; provided,
however, that Borrower will be liable in any such case under clauses (B) or (C)
above only to the extent that any such Securities Liabilities arise out of or is
based upon any such untrue statement or omission made therein in reliance upon
and in conformity with information furnished to Lender or any member of the
Issuer Group or Underwriter Group by or on behalf of Borrower or Borrower
Principal in connection with the preparation of the memorandum or prospectus or
other document (including any Investor or Rating Agency “term sheets” or
presentations relating to the Property and/or the Loan) or in connection with
the underwriting of the Loan, including, without limitation, financial
statements of Borrower or Borrower Principal, operating statements, Rent Rolls,
environmental site assessment reports and Property condition reports with
respect to the Property.  This indemnity agreement will be in addition to any
liability which Borrower and Borrower Principal may otherwise have.  Moreover,
the indemnification provided for in clauses (B) and (C) above shall be effective
whether or not an indemnification certificate described in (A) above is provided
and shall be applicable based on information previously provided by Borrower and
Borrower Principal or their Affiliates if Borrower or Borrower Principal do not
provide the indemnification certificate.
 
 
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(c)           In connection with filings under the Exchange Act or any
information provided to holders of Securities on an ongoing basis, Borrower and
Borrower Principal agree to indemnify (i) Lender, the Issuer Group and the
Underwriter Group for Losses to which Lender, the Issuer Group or the
Underwriter Group may become subject insofar as the Securities Liabilities arise
out of or are based upon the omission or alleged omission to state in the
Provided Information a material fact required to be stated in the Provided
Information in order to make the statements in the Provided Information, in
light of the circumstances under which they were made not misleading and (ii)
reimburse Lender, the Issuer Group or the Underwriter Group for any legal or
other expenses reasonably incurred by Lender, the Issuer Group or the
Underwriter Group in connection with defending or investigating the Securities
Liabilities arising from the errors and/or omissions referenced in subsection
(i) immediately above.
 
(d)           Promptly after receipt by an indemnified party under this Section
13.5 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party under
this Section 13.5, notify the indemnifying party in writing of the commencement
thereof, but the omission to so notify the indemnifying party will not relieve
the indemnifying party from any liability which the indemnifying party may have
to any indemnified party hereunder except to the extent that failure to notify
causes prejudice to the indemnifying party.  In the event that any action is
brought against any indemnified party, and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled, jointly with
any other indemnifying party, to participate therein and, to the extent that it
(or they) may elect by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified party, to
assume the defense thereof with counsel reasonably satisfactory to such
indemnified party.  After notice from the indemnifying party to such indemnified
party under this Section 13.5 the indemnifying party shall be responsible for
any legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation; provided, however, if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there are any legal defenses available to
it and/or other indemnified parties that are different from or additional to
those available to the indemnifying party, the indemnified party or parties
shall have the right to select separate counsel to assert such legal defenses
and to otherwise participate in the defense of such action on behalf of such
indemnified party or parties.  The indemnifying party shall not be liable for
the expenses of more than one such separate counsel unless an indemnified party
shall have reasonably concluded that there may be legal defenses available to it
that are different from or additional to those available to another indemnified
party.
 
(e)           In order to provide for just and equitable contribution in
circumstances in which the indemnity agreements provided for in Section 13.5(c)
or Section 13.5(d) is or are for any reason held to be unenforceable by an
indemnified party in respect of any losses, claims, damages or liabilities (or
action in respect thereof) referred to therein which would otherwise be
indemnifiable under Section 13.5(c) or Section 13.5(d), the indemnifying party
shall contribute to the amount paid or payable by the indemnified party as a
result of such losses, claims, damages or liabilities (or action in respect
thereof); provided, however, that no Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.  In determining the amount of contribution to
which the respective parties are entitled, the following factors shall be
considered:  (i) the indemnified party’s, Borrower’s and Borrower Principal’s
relative knowledge and access to information concerning the matter with respect
to which claim was asserted; (ii) the opportunity to correct and prevent any
statement or omission; and (iii) any other equitable considerations appropriate
in the circumstances.  Lender, Borrower and Borrower Principal hereby agree that
it would not be equitable if the amount of such contribution were determined by
pro rata or per capita allocation.
 
 
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(f)           The liabilities and obligations of Borrower, Borrower Principal
and Lender under this Section 13.5 shall survive the satisfaction of this
Agreement and the satisfaction and discharge of the Debt.
 
Section 13.6                      Regulation AB Information
 
(a)           If, at the time one or more Disclosure Documents are being
prepared for a securitization, Lender expects that Borrower alone or Borrower
and one or more affiliates of Borrower collectively, or the Property alone or
the Property and any other parcel(s) of real property, together with
improvements thereon and personal property related thereto, that is “related”,
within the meaning of the definition of Significant Obligor (as defined in Item
1101(k) of Regulation AB), to the Property (a “Related Property”) collectively,
will be a Significant Obligor, Borrower shall furnish to Lender upon request (i)
the selected financial data or, if applicable, net operating income, required
under Item 1112(b)(1) of Regulation AB and meeting the requirements thereof, if
Lender expects that the principal amount of the Loan, together with any loans
made to an affiliate of Borrower or secured by a Related Property that is
included in a securitization with the Loan (a “Related Loan”), as of the cut-off
date for such securitization may, or if the principal amount of the Loan
together with any Related Loans as of the cut-off date for such securitization
and at any time during which the Loan and any Related Loans are included in a
securitization does, equal or exceed ten percent (10%) (but less than twenty
percent (20%)) of the aggregate principal amount of all mortgage loans included
or expected to be included, as applicable, in the securitization or (ii) the
financial statements required under Item 1112(b)(2) of Regulation AB and meeting
the requirements thereof, if Lender expects that the principal amount of the
Loan together with any Related Loans as of the cut-off date for such
securitization may, or if the principal amount of the Loan together with any
Related Loans as of the cut-off date for such securitization and at any time
during which the Loan and any Related Loans are included in a securitization
does, equal or exceed twenty percent (20%) of the aggregate principal amount of
all mortgage loans included or expected to be included, as applicable, in the
securitization.  Such financial data or financial statements shall be furnished
to Lender (A) within ten (10) Business Days after notice from Lender in
connection with the preparation of Disclosure Documents for the securitization,
(B) not later than thirty (30) days after the end of each fiscal quarter of
Borrower and (C) not later than seventy-five (75) days after the end of each
fiscal year of Borrower; provided, however, that Borrower shall not be obligated
to furnish financial data or financial statements pursuant to clauses (B) or (C)
of this sentence with respect to any period for which a filing pursuant to the
Exchange Act in connection with or relating to the securitization (an “Exchange
Act Filing”) is not required.
 
(b)           If requested by Lender, Borrower shall furnish, or shall cause the
applicable tenant to furnish, to Lender financial data and/or financial
statements in accordance with Regulation AB for any tenant of any Property if,
in connection with a securitization, Lender expects there to be, with respect to
such tenant or group of affiliated tenants, a concentration within all of the
mortgage loans included or expected to be included, as applicable, in such
securitization such that such tenant or group of affiliated tenants would
constitute a Significant Obligor; provided, however, that in the event the
related lease does not require the related tenant to provide the foregoing
information, Borrower shall use commercially reasonable efforts to cause the
applicable tenant to furnish such information.
 
 
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Section 13.7                      Rating Surveillance
 
Borrower will retain the Rating Agencies to provide rating surveillance services
on any certificates issued in a Securitization.  Such rating surveillance will
be at the expense of Borrower in an amount determined by Lender in its
reasonable discretion prior to the occurrence of a Securitization and such
expense will be paid at the closing of the Securitization.
 
Section 13.8                      New Mezzanine Loan
 
Lender, without in any way limiting Lender’s other rights hereunder, shall have
the right, in its sole and absolute discretion, at any time to require Borrower
to restructure a portion of the Loan and create a mezzanine loan (the “New
Mezzanine Loan”) to the owners of the direct equity interests in Borrower which
shall be secured by a pledge of such direct equity interests (which New
Mezzanine Loan shall be superior to any Mezzanine Loan created pursuant to
Section 7.6 hereof), and for which different interest rates and debt service
payments may be established for the Loan and the New Mezzanine Loan in such
order of priority as may be designated by Lender; provided, that (a) (i) the
total amounts of the Loan and the New Mezzanine Loan shall equal the amount of
the Loan immediately prior to the restructuring, (ii) the weighted average
interest rate of the Loan and the New Mezzanine Loan, shall on the date created
equal the interest rate which was applicable to the Loan immediately prior to
the restructuring and (iii) the debt service payments on the Loan and the New
Mezzanine Loan shall on the date created equal the debt service payment which
was due under the Loan immediately prior to the restructuring; and provided
further that any such restructuring carried out after the closing of the Loan
shall be at no material cost to Borrower.  At Borrower’s expense, Borrower shall
cooperate with all reasonable requests of Lender in order to restructure the
Loan and create the New Mezzanine Loan and shall (A) execute and deliver such
documents including, without limitation, in the case of the New Mezzanine Loan,
a mezzanine note, a mezzanine loan agreement, a pledge and security agreement
and a mezzanine deposit account agreement, (B) cause Borrower’s counsel to
deliver such legal opinions and (C) create such bankruptcy remote borrower under
the New Mezzanine Loan as, in the case of each of (A), (B) and (C) above, shall
be reasonably required by Lender and required by any Rating Agency in connection
therewith, all in form and substance reasonably satisfactory to Lender and
satisfactory to any such Rating Agency, including the severance of this
Agreement, the Mortgage and other Loan Documents if requested.  In the event
Borrower fails to execute and deliver such documents to Lender within ten (10)
Business Days following such request by Lender, Borrower hereby absolutely and
irrevocably appoints Lender as its true and lawful attorney, coupled with an
interest, in its name and stead to make and execute all documents necessary or
desirable to effect such transactions, Borrower ratifying all that such attorney
shall do by virtue thereof.  It shall be an Event of Default if Borrower fails
to comply with any of the terms, covenants or conditions of this Section 13.9
after the expiration of ten (10) Business Days after notice
thereof.  Notwithstanding the provisions of this Article 13 to the contrary,
Borrower shall not be obligated to spend more than the Cooperation Cap in the
aggregate in connection with complying with the provisions of this Article 13,
but Borrower shall still be obligated to pay for other costs and expenses
(including, without limitation, it’s own legal fees) in excess of such
limitation.
 
 
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ARTICLE 14
INDEMNIFICATIONS
 
Section 14.1                      General Indemnification
 
Borrower shall indemnify, defend and hold harmless the Indemnified Parties from
and against any and all Losses imposed upon or incurred by or asserted against
any Indemnified Parties and directly or indirectly arising out of or in any way
relating to any one or more of the following: (a) 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; (b) 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;
(c) performance of any labor or services or the furnishing of any materials or
other property in respect of the Property or any part thereof; (d) any failure
of the Property to be in compliance with any applicable Legal Requirements; (e)
any and all claims and demands whatsoever which may be asserted against Lender
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; (f)
the holding or investing of the Reserve Accounts or the performance of the
Required Work, Additional Required Repairs or Additional Replacements, or (g)
the payment of any commission, charge or brokerage fee to anyone which may be
payable in connection with the funding of the Loan (collectively, the
“Indemnified Liabilities”); provided, however, that Borrower shall not have any
obligation to Lender hereunder to the extent that such Indemnified Liabilities
arise from the gross negligence, illegal acts, fraud, willful misconduct of
Lender or Lender’s failure to comply with any applicable obligations imposed
upon it by the terms of this Agreement.  To the extent that the undertaking to
indemnify, defend and hold harmless set forth in the preceding sentence may be
unenforceable because it violates any law or public policy, Borrower shall pay
the maximum portion that it is permitted to pay and satisfy under applicable law
to the payment and satisfaction of all Indemnified Liabilities incurred by
Lender.
 
Section 14.2                      Mortgage and Intangible Tax Indemnification
 
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 Indemnified Parties
and directly or indirectly arising out of or in any way relating to any tax on
the making and/or recording of the Mortgage, the Note or any of the other Loan
Documents, but excluding any income, franchise or other similar taxes.
 
Section 14.3                      ERISA Indemnification
 
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 Lender’s sole discretion) that Lender may incur, directly or
indirectly, as a result of a default under Section 4.9 or Section 5.18 of this
Agreement.
 
 
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Section 14.4                      Survival
 
The obligations and liabilities of Borrower under this Article 14 shall fully
survive indefinitely notwithstanding any termination, satisfaction, assignment,
entry of a judgment of foreclosure, exercise of any power of sale, or delivery
of a deed in lieu of foreclosure of the Mortgage.
 
ARTICLE 15
EXCULPATION
 
Section 15.1                      Exculpation
 
(a)           Except as otherwise provided herein or in the other Loan
Documents, Lender shall not enforce the liability and obligation of Borrower or
Borrower Principal, as applicable, to perform and observe the obligations
contained herein or in the other Loan Documents by any action or proceeding
wherein a money judgment shall be sought against Borrower or Borrower Principal,
except that Lender may bring a foreclosure action, action for specific
performance or other appropriate action or proceeding to enable Lender to
enforce and realize upon this Agreement, the Note, the Mortgage and the other
Loan Documents, and the interest in the Property, the Rents and any other
collateral given to Lender created by this Agreement, the Note, the Mortgage and
the other Loan Documents; provided, however, that any judgment in any such
action or proceeding shall be enforceable against Borrower or Borrower
Principal, as applicable, only to the extent of Borrower’s or Borrower
Principal’s interest in the Property, in the Rents and in any other collateral
given to Lender.  Lender, by accepting this Agreement, the Note, the Mortgage
and the other Loan Documents, agrees that it shall not, except as otherwise
provided in this Section 15.1, sue for, seek or demand any deficiency judgment
against Borrower or Borrower Principal in any such action or proceeding, under
or by reason of or under or in connection with this Agreement, the Note, the
Mortgage or the other Loan Documents.  The provisions of this Section 15.1 shall
not, however, (i) constitute a waiver, release or impairment of any obligation
evidenced or secured by this Agreement, the Note, the Mortgage or the other Loan
Documents; (ii) impair the right of Lender to name Borrower or Borrower
Principal as a party defendant in any action or suit for judicial foreclosure
and sale under this Agreement and the Mortgage; (iii) affect the validity or
enforceability of any indemnity (including, without limitation, those contained
in Section 12.6 and Article 14 of this Agreement), guaranty, master lease or
similar instrument made in connection with this Agreement, the Note, the
Mortgage and the other Loan Documents; (iv) impair the right of Lender to obtain
the appointment of a receiver; (v) impair the enforcement of the assignment of
leases provisions contained in the Mortgage; or (vi) impair the right of Lender
to obtain a deficiency judgment or other judgment on the Note against Borrower
or Borrower Principal if necessary to obtain any Insurance Proceeds or Awards to
which Lender would otherwise be entitled under this Agreement; provided,
however, Lender shall only enforce such judgment to the extent of the Insurance
Proceeds and/or Awards.
 
 
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(b)           Notwithstanding the provisions of this Section 15.1 to the
contrary, Borrower and Borrower Principal shall be personally liable to Lender
on a joint and several basis for Losses due to:
 
(i)           fraud or intentional misrepresentation by Borrower, Borrower
Principal or any other Affiliate of Borrower or Borrower Principal in connection
with the execution and the delivery of this Agreement, the Note, the Mortgage,
any of the other Loan Documents, or any certificate, report, financial statement
or other instrument or document furnished to Lender at the time of the closing
of the Loan or during the term of the Loan;
 
(ii)           Borrower’s misapplication or misappropriation of Rents received
by Borrower after the occurrence of an Event of Default;
 
(iii)          Borrower’s misapplication or misappropriation of tenant security
deposits or Rents collected in advance;
 
(iv)          the misapplication or the misappropriation of Insurance Proceeds
or Awards;
 
(v)           Borrower’s failure to pay Taxes, Other Charges (except to the
extent that (A) sums sufficient to pay such amounts have been deposited in
escrow with Lender pursuant to the terms hereof and there exists no impediment
to Lender’s utilization thereof or (B) there is insufficient cash flow from the
operation of the Property);
 
(vi)          Borrower’s failure to return or to reimburse Lender for all
Personal Property taken from the Property by or on behalf of Borrower and not
replaced with Personal Property of the same utility and of the same or greater
value;
 
(vii)         any act of actual waste or arson by Borrower, any principal,
Affiliate, member or general partner thereof or by Borrower Principal, any
principal, Affiliate, member or general partner thereof; or
 
(viii)        the breach of any representation, warranty, covenant or
indemnification set forth in Article 12 or Article 14 hereof or in any other
Loan Document concerning environmental laws, hazardous substances and asbestos
and any indemnification of Lender with respect thereto in any document.
 
(c)           Notwithstanding the foregoing, the agreement of Lender not to
pursue recourse liability as set forth in subsection (a) above SHALL BECOME NULL
AND VOID and shall be of no further force and effect and the Debt shall be fully
recourse to Borrower and Borrower Principal on a joint and several basis in the
event (i) of a breach by Borrower, Borrower Principal or any SPE Component
Entity (if any) of any of the covenants set forth in Article 6 hereof, to the
extent that such breach is (A) material and (B) is not cured within fifteen (15)
days of the earlier to occur of notice from Lender or such breach becomes
actually known by a officer of Borrower, (ii) of a material breach of any of the
covenants set forth in Article 7 hereof, (iii) the Property or any part thereof
shall become an asset in a voluntary bankruptcy or voluntary insolvency
proceeding of Borrower, (iv) Borrower, Borrower Principal or any Affiliate,
officer, director, or representative which controls, directly or indirectly,
Borrower or Borrower Principal files, or joins in the filing of, an involuntary
petition against Borrower under any Creditors Rights Laws, or solicits or causes
to be solicited petitioning creditors for any involuntary petition against
Borrower from any Person; (v)  Borrower files an answer consenting to or
otherwise acquiescing in or joining in any involuntary petition filed against
it, by any other Person under any Creditors Rights Laws, or solicits or causes
to be solicited petitioning creditors for any involuntary petition from any
Person; (vi) any Affiliate, officer, director, or representative which controls
Borrower consents to or acquiesces in or joins in an application for the
appointment of a custodian, receiver, trustee, or examiner for Borrower or any
portion of the Property; or (vii) Borrower fails to obtain Lender’s prior
written consent to any subordinate financing or other voluntary Lien encumbering
the Property, if such consent is required by the Loan Documents.
 
 
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(d)           Nothing herein shall be deemed to be a waiver of any right which
Lender may have under Section 506(a), 506(b), 1111(b) or any other provision of
the U.S. Bankruptcy Code to file a claim for the full amount of the indebtedness
secured by the Mortgage or to require that all collateral shall continue to
secure all of the indebtedness owing to Lender in accordance with this
Agreement, the Note, the Mortgage or the other Loan Documents.
 
(e)           Subject to the terms of Section 12.6, upon payment in full of the
Loan, Borrower Principal shall be relieved of its obligations under this Article
15.
 
ARTICLE 16
NOTICES
 
Section 16.1                      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, return receipt requested, (b) expedited prepaid
overnight delivery service, either commercial or United States Postal Service,
with proof of attempted delivery, or by (c) telecopier (with answer back
acknowledged provided an additional notice is given pursuant to subsection (b)
above), addressed as follows (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):
 

  If to Lender: Bank of America, N.A.     Real Estate Structured Finance -
Servicing     900 West Trade Street     Suite 650     NC1-026-06-01    
Charlotte, North Carolina 28255     Attn:  Servicing Manager     Telephone No:
(866) 531-0957     Facsimile No.: (704) 317-4501         With a copy to: 
Sonnenschein Nath & Rosenthal LLP     Two World Financial Center    
New York, New York 10281
    Attention:  David S. Hall, Esq.     Telephone No.:  (212) 768-6806    
Facsimile No.:  (212) 768-6800

 
 
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  If to Borrower:  PTC Columbus, LLC     180 East Broad Street, 21st Floor    
Columbus, Ohio 43215     Attention:  Richard Burkhart     Telephone No.:  (614)
887-5889     Facsimile No.:  (614) 621-2326         With a copy to: PTC
Columbus, LLC     180 East Broad Street, 21st Floor     Columbus, Ohio 43215    
Attention:  General Counsel     Telephone No.:  (614) 887-5623     Facsimile
No.:  (614) 621-8863           and           John I. Cadwallader, Esq.     Frost
Brown Todd LLC     One Columbus     10 West Broad Street    
Suite 2300
    Columbus, OH 43215     Phone:  (614) 464-1211     Fax:  (614) 464-1737      
  If to Borrower     Principal:   Glimcher Properties Limited Partnership    
180 East Broad Street, 21st Floor     Attention:  Richard Burkhart     Telephone
No.:  (614) 887-5889     Facsimile No.:  (614) 621-2326         With a copy
to:   Glimcher Properties Limited Partnership     180 East Broad Street, 21st
Floor     Attention:  General Counsel     Telephone No.:  (614) 889-5623    
Facsimile No.:  (614) 621-8863           and           John I. Cadwallader, Esq.
    Frost Brown Todd LLC     One Columbus     10 West Broad Street     Suite
2300     Columbus, OH 43215     Phone:  (614) 464-1211     Fax:  (614) 464-1737

 
 
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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 the first attempted delivery on a Business Day; or in the case of
expedited prepaid delivery and telecopy, upon the first attempted delivery on a
Business Day.
 
ARTICLE 17
FURTHER ASSURANCES
 
Section 17.1                      Replacement Documents
 
Upon receipt of an affidavit of an officer of Lender as to the loss, theft,
destruction or mutilation of the Note or any other Loan Document which is not of
public record:  (i) with respect to any Loan Document other than the Note,
Borrower will issue, in lieu thereof, a replacement of such other Loan Document,
dated the date of such lost, stolen, destroyed or mutilated Loan Document in the
same principal amount thereof and otherwise of like tenor and (ii) with respect
to the Note, (a) Borrower will execute a reaffirmation of the Debt as evidenced
by such Note acknowledging that Lender has informed Borrower that the Note was
lost, stolen destroyed or mutilated and that such Debt continues to be an
obligation and liability of Borrower as set forth in the Note, a copy of which
shall be attached to such reaffirmation and (b) if requested by Lender, Borrower
will execute a replacement note and Lender or Lender’s custodian (at Lender’s
option) shall provide to Borrower Lender’s (or Lender’s custodian’s) then
standard form of lost note affidavit and indemnity, which such form shall be
reasonably acceptable to Borrower.
 
Section 17.2                      Recording of Mortgage, etc
 
Borrower forthwith upon the execution and delivery of the Mortgage and
thereafter, from time to time, will cause the Mortgage and any of the other Loan
Documents creating a lien or security interest or evidencing the lien hereof
upon the Property and each instrument of further assurance to be filed,
registered or recorded in such manner and in such places as may be required by
any present or future law in order to publish notice of and fully to protect and
perfect the lien or security interest hereof upon, and the interest of Lender
in, the Property.  Borrower will pay all taxes, filing, registration or
recording fees, and all expenses incident to the preparation, execution,
acknowledgment and/or recording of the Note, the Mortgage, the other Loan
Documents, any note, deed of trust or mortgage supplemental hereto, any security
instrument with respect to the Property and any instrument of further assurance,
and any modification or amendment of the foregoing documents, and all federal,
state, county and municipal taxes, duties, imposts, assessments and charges
arising out of or in connection with the execution and delivery of the Mortgage,
any deed of trust or mortgage supplemental hereto, any security instrument with
respect to the Property or any instrument of further assurance, and any
modification or amendment of the foregoing documents, except where prohibited by
law so to do.
 
 
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Section 17.3                      Further Acts, etc
 
Borrower will, at the cost of Borrower, and without expense to Lender, do,
execute, acknowledge and deliver all and every further acts, deeds, conveyances,
deeds of trust, mortgages, assignments, security agreements, control agreements,
notices of assignments, transfers and assurances as Lender shall, from time to
time, reasonably require, for the better assuring, conveying, assigning,
transferring, and confirming unto Lender the property and rights hereby
mortgaged, deeded, granted, bargained, sold, conveyed, confirmed, pledged,
assigned, warranted and transferred or intended now or hereafter so to be, or
which Borrower may be or may hereafter become bound to convey or assign to
Lender, or for carrying out the intention or facilitating the performance of the
terms of this Agreement or for filing, registering or recording the Mortgage, or
for complying with all Legal Requirements.  Borrower, on demand, will execute
and deliver, and in the event it shall fail to so execute and deliver, hereby
authorizes Lender to execute in the name of Borrower or without the signature of
Borrower to the extent Lender may lawfully do so, one or more financing
statements and financing statement amendments to evidence more effectively,
perfect and maintain the priority of the security interest of Lender in the
Property.  Borrower grants to Lender an irrevocable power of attorney coupled
with an interest for the purpose of exercising and perfecting any and all rights
and remedies available to Lender at law and in equity, including without
limitation, such rights and remedies available to Lender pursuant to this
Section 17.3.
 
Section 17.4                      Changes in Tax, Debt, Credit and Documentary
Stamp Laws
 
(a)           If any law is enacted or adopted or amended after the date of this
Agreement which deducts the Debt from the value of the Property for the purpose
of taxation or which imposes a tax, either directly or indirectly, on the Debt
or Lender’s interest in the Property, Borrower will pay the tax, with interest
and penalties thereon, if any.  If Lender is advised by counsel chosen by it
that the payment of tax by Borrower would be unlawful or taxable to Lender or
unenforceable or provide the basis for a defense of usury then Lender shall have
the option by written notice of not less than one hundred twenty (120) days to
declare the Debt immediately due and payable.
 
(b)           Borrower will not claim or demand or be entitled to any credit or
credits on account of the Debt for any part of the Taxes or Other Charges
assessed against the Property, or any part thereof, and no deduction shall
otherwise be made or claimed from the assessed value of the Property, or any
part thereof, for real estate tax purposes by reason of the Mortgage or the
Debt.  If such claim, credit or deduction shall be required by law, Lender shall
have the option, by written notice of not less than one hundred twenty (120)
days, to declare the Debt immediately due and payable.
 
If at any time the United States of America, any State thereof or any
subdivision of any such State shall require revenue or other stamps to be
affixed to the Note, the Mortgage, or any of the other Loan Documents or impose
any other tax or charge on the same, Borrower will pay for the same, with
interest and penalties thereon, if any.
 
 
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Section 17.5                      Expenses
 
Borrower covenants and agrees to pay or, if Borrower fails to pay, to reimburse,
Lender upon receipt of written notice from Lender for all reasonable costs and
expenses (including reasonable, actual attorneys’ fees and disbursements and the
allocated costs of internal legal services and all actual disbursements of
internal counsel) reasonably incurred by Lender in accordance with this
Agreement (all of which shall be deemed part of the Debt) in connection with (a)
the preparation, negotiation, execution and delivery of this Agreement and the
other Loan Documents and the consummation of the transactions contemplated
hereby and thereby and all the costs of furnishing all opinions by counsel for
Borrower (including without limitation any opinions requested by Lender as to
any legal matters arising under this Agreement or the other Loan Documents with
respect to the Property); (b) Borrower’s ongoing performance of and compliance
with Borrower’s respective agreements and covenants contained in this Agreement
and the other Loan Documents on its part to be performed or complied with after
the Closing Date, including, without limitation, confirming compliance with
environmental and insurance requirements; (c) following a request by Borrower,
Lender’s ongoing performance and compliance with all agreements and conditions
contained in this Agreement and the other Loan Documents on its part to be
performed or complied with after the Closing Date; (d) the negotiation,
preparation, execution, delivery and administration of any consents, amendments,
waivers or other modifications to this Agreement and the other Loan Documents
and any other documents or matters requested by Lender; (e) securing Borrower’s
compliance with any requests made pursuant to the provisions of this Agreement;
(f) the filing and recording fees and expenses, title insurance and reasonable
fees and expenses of counsel for providing to Lender all required legal
opinions, and other similar expenses incurred in creating and perfecting the
Lien in favor of Lender pursuant to this Agreement and the other Loan Documents;
(g) enforcing or preserving any rights, in response to third party claims or the
prosecuting or defending of any action or proceeding or other litigation, in
each case against, under or affecting Borrower, this Agreement, the other Loan
Documents, the Property, or any other security given for the Loan; and (h)
enforcing any obligations of or collecting any payments due from Borrower under
this Agreement, the other Loan Documents or with respect to the Property or in
connection with any refinancing or restructuring of the credit arrangements
provided under this Agreement in the nature of a “work-out” or of any insolvency
or bankruptcy proceedings; provided, however, that Borrower shall not be liable
for the payment of any such costs and expenses to the extent the same arise by
reason of the gross negligence, illegal acts, fraud or willful misconduct of
Lender.
 
Section 17.6                      Cost of Enforcement.
 
In the event (a) that the Mortgage is foreclosed in whole or in part, (b) of the
bankruptcy, insolvency, rehabilitation or other similar proceeding in respect of
Borrower or any of its constituent Persons or an assignment by Borrower or any
of its constituent Persons for the benefit of its creditors, or (c) Lender
exercises any of its other remedies under this Agreement or any of the other
Loan Documents, Borrower shall be chargeable with and agrees to pay all costs of
collection and defense, including attorneys’ fees and costs, incurred by Lender
or Borrower in connection therewith and in connection with any appellate
proceeding or post-judgment action involved therein, together with all required
service or use taxes, all of which shall be deemed part of the Debt.  In
addition, Borrower shall be responsible for any fees and expenses of any
servicer and any third-party fees and expenses, including, without limitation,
special servicing fees, work-out fees and attorneys fees and disbursements in
connection with a prepayment, release of the Property, assumption or
modification of the Loan, special servicing or work-out of the Loan or
enforcement of the Loan Documents.
 
 
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ARTICLE 18
WAIVERS
 
Section 18.1                      Remedies Cumulative; Waivers
 
The rights, powers and remedies of Lender under this Agreement shall be
cumulative and not exclusive of any other right, power or remedy which Lender
may have against Borrower or Borrower Principal pursuant to this Agreement or
the other Loan Documents, or existing at law or in equity or
otherwise.  Lender’s rights, powers and remedies may be pursued singularly,
concurrently or otherwise, at such time and in such order as Lender may
determine in Lender’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 one Default or Event of Default with respect to
Borrower shall not be construed to be a waiver of any subsequent Default or
Event of Default by Borrower or to impair any remedy, right or power consequent
thereon.
 
Section 18.2                      Modification, Waiver in Writing
 
No modification, amendment, extension, discharge, termination or waiver of any
provision of this Agreement, or of the Note, or of any other Loan Document, nor
consent to any departure 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 18.3                      Delay Not a Waiver
 
Neither any failure nor any delay on the part of Lender in insisting upon strict
performance of any term, condition, covenant or agreement, or exercising any
right, power, remedy or privilege hereunder, or under the Note 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, 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 18.4                      Trial by Jury
 
BORROWER, BORROWER PRINCIPAL AND LENDER EACH HEREBY AGREES NOT TO ELECT A TRIAL
BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVES ANY RIGHT TO TRIAL BY
JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH
REGARD TO THE LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING
IN CONNECTION THEREWITH.  THIS WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN
KNOWINGLY AND VOLUNTARILY BY BORROWER, BORROWER PRINCIPAL AND LENDER, AND IS
INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE
RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE.  EACH OF LENDER, BORROWER
PRINCIPAL AND BORROWER IS HEREBY AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN
ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER BY BORROWER, BORROWER
PRINCIPAL AND LENDER.
 
 
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Section 18.5                      Waiver of Notice
 
Borrower shall not be entitled to any notices of any nature whatsoever from
Lender except with respect to matters for which this Agreement or the other Loan
Documents specifically and expressly provide for the giving of notice by Lender
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
Lender with respect to any matter for which this Agreement or the other Loan
Documents do not specifically and expressly provide for the giving of notice by
Lender to Borrower.
 
Section 18.6                      Remedies of Borrower
 
In the event that a claim or adjudication is made that Lender or its agents have
acted unreasonably or unreasonably delayed acting in any case where by law or
under this Agreement or the other Loan Documents, Lender or such agent, as the
case may be, has an obligation to act reasonably or promptly, Borrower agrees
that neither Lender nor its agents shall be liable for any monetary damages, and
Borrower’s sole remedies shall be limited to commencing an action seeking
injunctive relief or declaratory judgment.  The parties hereto agree that any
action or proceeding to determine whether Lender has acted reasonably shall be
determined by an action seeking declaratory judgment.  Lender agrees that, in
such event, it shall cooperate in expediting any action seeking injunctive
relief or declaratory judgment.
 
Section 18.7                      Waiver of Marshalling of Assets
 
To the fullest extent permitted by law, Borrower, for itself and its successors
and assigns, waives all rights to a marshalling of the assets of Borrower,
Borrower’s partners and others with interests in Borrower, and of the Property,
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 Lender under the Loan Documents to a sale
of the Property for the collection of the Debt without any prior or different
resort for collection or of the right of Lender to the payment of the Debt out
of the net proceeds of the Property in preference to every other claimant
whatsoever.
 
 
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Section 18.8                      Waiver of Statute of Limitations
 
Borrower hereby expressly waives and releases, to the fullest extent permitted
by law, the pleading of any statute of limitations as a defense to payment of
the Debt or performance of its Other Obligations.
 
Section 18.9                      Waiver of Counterclaim
 
Borrower hereby waives the right to assert a counterclaim, other than a
compulsory counterclaim, in any action or proceeding brought against it by
Lender or its agents.
 
ARTICLE 19
GOVERNING LAW
 
Section 19.1                      Choice of Law
 
This Agreement shall be governed, construed, applied and enforced in accordance
with the laws of the State and applicable laws of the United States of America,
except that, with respect to the security interest in each of the Reserve
Accounts, the Lockbox Account and the Cash Management Account, the laws of the
state where each such account is located shall apply.
 
Section 19.2                      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 19.3                      Preferences
 
Lender 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.  To the extent Borrower makes a payment or payments to
Lender, 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 Creditors Rights
Laws, 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 Lender.
 
 
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ARTICLE 20
MISCELLANEOUS
 
Section 20.1                      Survival
 
This Agreement and all covenants, agreements, representations and warranties
made herein and in the certificates delivered pursuant hereto shall survive the
making by Lender of the Loan and the execution and delivery to Lender of the
Note, and shall continue in full force and effect so long as all or any of the
Debt is outstanding and unpaid unless a longer period is expressly set forth
herein or in the other Loan Documents.  Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
legal representatives, successors and assigns of such party.  All covenants,
promises and agreements in this Agreement,  by or on behalf of Borrower, shall
inure to the benefit of the legal representatives, successors and assigns of
Lender.
 
Section 20.2                      Lender’s Discretion
 
Whenever pursuant to this Agreement, Lender exercises any right given to it to
approve or disapprove, or any arrangement or term is to be satisfactory to
Lender, the decision of Lender 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 Lender and
shall be final and conclusive.
 
Section 20.3                      Headings
 
The Article and/or Section headings and the Table of Contents in this Agreement
are included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose.
 
Section 20.4                      Schedules Incorporated
 
The Schedules annexed hereto are hereby incorporated herein as a part of this
Agreement with the same effect as if set forth in the body hereof.
 
Section 20.5                      Offsets, Counterclaims and Defenses
 
Any assignee of Lender’s interest in and to this Agreement, the Note and the
other Loan Documents shall take the same free and clear of all offsets,
counterclaims or defenses which are unrelated to such documents which Borrower
may otherwise have against any assignor of such documents, and no such unrelated
counterclaim or defense shall be interposed or asserted by Borrower in any
action or proceeding brought by any such assignee upon such documents and 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 20.6                      No Joint Venture or Partnership; No Third
Party Beneficiaries
 
(a)           Borrower and Lender intend that the relationships created
hereunder and under the other Loan Documents be solely that of borrower and
lender.  Nothing herein or therein is intended to create a joint venture,
partnership, tenancy-in-common, or joint tenancy relationship between Borrower
and Lender nor to grant Lender any interest in the Property other than that of
mortgagee, beneficiary or lender.
 
 
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(b)           This Agreement and the other Loan Documents are solely for the
benefit of Lender and Borrower and nothing contained in this Agreement or the
other Loan Documents shall be deemed to confer upon anyone other than Lender and
Borrower any right to insist upon or to enforce the performance or observance of
any of the obligations contained herein or therein.  All conditions to the
obligations of Lender to make the Loan hereunder are imposed solely and
exclusively for the benefit of Lender and no other Person shall have standing to
require satisfaction of such conditions in accordance with their terms or be
entitled to assume that Lender will refuse to make the Loan in the absence of
strict compliance with any or all thereof and no other Person shall under any
circumstances be deemed to be a beneficiary of such conditions, any or all of
which may be freely waived in whole or in part by Lender if, in Lender’s sole
discretion, Lender deems it advisable or desirable to do so.
 
(c)           The general partners, members, principals and (if Borrower is a
trust) beneficial owners of Borrower are experienced in the ownership and
operation of properties similar to the Property, and Borrower and Lender are
relying solely upon such expertise and business plan in connection with the
ownership and operation of the Property.  Borrower is not relying on Lender’s
expertise, business acumen or advice in connection with the Property.
 
(d)           Notwithstanding anything to the contrary contained herein, Lender
is not undertaking the performance of (i) any obligations under the Leases; or
(ii) any obligations with respect to such agreements, contracts, certificates,
instruments, franchises, permits, trademarks, licenses and other documents.
 
(e)           By accepting or approving anything required to be observed,
performed or fulfilled or to be given to Lender pursuant to this Agreement, the
Mortgage, the Note or the other Loan Documents, including, without limitation,
any officer’s certificate, balance sheet, statement of profit and loss or other
financial statement, survey, appraisal, or insurance policy, Lender shall not be
deemed to have warranted, consented to, or affirmed the sufficiency, the
legality or effectiveness of same, and such acceptance or approval thereof shall
not constitute any warranty or affirmation with respect thereto by Lender.
 
(f)           Borrower recognizes and acknowledges that in accepting this
Agreement, the Note, the Mortgage and the other Loan Documents, Lender is
expressly and primarily relying on the truth and accuracy of the representations
and warranties set forth in Article 4 of this Agreement without any obligation
to investigate the Property and notwithstanding any investigation of the
Property by Lender; that such reliance existed on the part of Lender prior to
the date hereof, that the warranties and representations are a material
inducement to Lender in making the Loan; and that Lender would not be willing to
make the Loan and accept this Agreement, the Note, the Mortgage and the other
Loan Documents in the absence of the warranties and representations as set forth
in Article 4 of this Agreement.
 
Section 20.7                      Publicity
 
All news releases, publicity or advertising by Borrower or its Affiliates
through any media intended to reach the general public which refers to the Loan,
Lender, Banc of America Securities LLC, or any of their Affiliates shall be
subject to the prior written approval of Lender, not to be unreasonably
withheld.  Lender shall be permitted to make any news, releases, publicity or
advertising by Lender or its Affiliates through any media intended to reach the
general public which refers to the Loan, the Property, Borrower, Borrower
Principal and their respective Affiliates without the approval of Borrower or
any such Persons.  Borrower also agrees that Lender may share any information
pertaining to the Loan with Bank of America Corporation, including its bank
subsidiaries, Banc of America Securities LLC and any other Affiliates of the
foregoing, in connection with the sale or transfer of the Loan or any
Participations and/or Securities created; provided however, nothing in this
Section shall in any way restrict or inhibit Borrower, Borrower Principal or any
of its Affiliates from issuing any press releases or from making any filings
required by any of the aforesaid due to obligations imposed by applicable laws
or regulations, including without limitation, all applicable securities laws and
regulations.
 
 
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Section 20.8                      Conflict; Construction of Documents; Reliance
 
In the event of any conflict between the provisions of this Agreement and any of
the other Loan Documents, the provisions of this Agreement shall control.  The
parties hereto acknowledge that they were represented by competent counsel in
connection with the negotiation, drafting and execution of the Loan Documents
and that such Loan Documents shall not be subject to the principle of construing
their meaning against the party which drafted same.  Borrower acknowledges that,
with respect to the Loan, Borrower shall rely solely on its own judgment and
advisors in entering into the Loan without relying in any manner on any
statements, representations or recommendations of Lender or any parent,
subsidiary or Affiliate of Lender.  Lender shall not be subject to any
limitation whatsoever in the exercise of any rights or remedies available to it
under any of the Loan Documents or any other agreements or instruments which
govern the Loan by virtue of the ownership by it or any parent, subsidiary or
Affiliate of Lender of any equity interest any of them may acquire in Borrower,
and Borrower hereby irrevocably waives the right to raise any defense or take
any action on the basis of the foregoing with respect to Lender’s exercise of
any such rights or remedies.  Borrower acknowledges that Lender engages in the
business of real estate financings and other real estate transactions and
investments which may be viewed as adverse to or competitive with the business
of Borrower or its Affiliates.
 
Section 20.9                      Duplicate Originals; Counterparts
 
This Agreement and each of the other Loan Documents may be executed in any
number of duplicate originals, and each duplicate original shall be deemed to be
an original.  This Agreement and each of the other Loan Documents (and each
duplicate original) also may be executed in any number of counterparts, each of
which shall be deemed an original and all of which together constitute a fully
executed agreement even though all signatures do not appear on the same
document.
 
Section 20.10                    Entire Agreement
 
This Agreement and the other Loan Documents contain the entire agreement of the
parties hereto and thereto in respect of the transactions contemplated hereby
and thereby, and all prior agreements among or between such parties, whether
oral or written between Borrower and Lender are superseded by the terms of this
Agreement and the other Loan Documents.
 
 
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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.
 
BORROWER:
 
PTC COLUMBUS, LLC, a Delaware limited liability company

 
By:
POLARIS CENTER, LLC, a Delaware limited liability company, its sole member

By:           GLIMCHER PTC, INC., a Delawarecorporation, its Managing Member
 
By:  ________________________                                                    
        Mark E. Yale
        Executive Vice President
        Chief Financial Officer and
        Treasurer
 
BORROWER PRINCIPAL:
 
Acknowledged and agreed to with respect to its obligations set forth in Article
4, Section 12.6, Article 15 and Article 18 hereof:
 
GLIMCHER PROPERTIES LIMITED PARTNERSHIP, a Delaware limited partnership
 
By:  Glimcher Properties Corporation, a
        Delaware corporation, sole general
        partner

By:  ________________________                                                        
        Mark E. Yale
        Executive Vice President
        Chief Financial Officer and
        Treasurer
LENDER:
 
BANK OF AMERICA, N.A., a national banking association
 
By:          ________________________ 
Name:
Title:
 
 
 

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EXHIBIT A – BORROWER EQUITY OWNERSHIP STRUCTURE
 
POLARIS TOWNE CENTER
PROPOSED BORROWER STRUCTURE CHART

PTC COLUMBUS, LLC
 
[Note: Excepting existing owner, Polaris Center, LLC & Glimcher PTC, Inc. and
the new SPE, PTC Columbus, LLC, ownership percentages are as of 12/31/09 for
other entities.]
 
 
[exhibita.jpg]
 
 
 

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EXHIBIT B
Form of Tenant Direction Letter
 
PTC COLUMBUS, LLC
c/o Glimcher Properties Limited Partnership
180 East Broad Street, 21st Floor
Columbus, Ohio 43215
 
March 31, 2010
 
VIA CERTIFIED MAIL – RETURN RECEIPT REQUESTED

[Tenant name & address]
 
 
Re:
DBA Name

 
Polaris Towne Center

 
Columbus, Ohio (the "Property")

Dear Tenant:

Please be advised that effective as of the date of this Notice, in connection
with a refinancing of the mortgage on the above-referenced Property, Polaris
Center, LLC has transferred ownership of the Property to a newly formed
subsidiary, PTC COLUMBUS, LLC, and PTC COLUMBUS, LLC is now your new landlord
(“Landlord”).  You are further advised that Landlord, has granted a mortgage in
favor of BANK OF AMERICA, N.A., a national banking association (together with
its successors and assigns "Lender") on the above-referenced Property in which
you are a tenant.  Pursuant to the mortgage, the Landlord has granted a security
interest in favor of Lender in the leases relating to the Property and all
rents, additional rent and all other monetary obligations to Landlord thereunder
(collectively, "Rent").  The Landlord hereby irrevocably instructs and
authorizes you to disregard any and all previous notices sent to you in
connection with Rent and hereafter to deliver all Rent to the following new
address:

PTC Columbus, LLC
L-2017
Columbus, OH 43260

All checks should be made payable to “PTC Columbus, LLC”.

These payment instructions cannot be withdrawn or modified without the prior
written consent of Lender or its agent (“Servicer”), or pursuant to a joint
written instruction from Landlord and Lender or the Servicer.

You are hereby further advised that the Property will continue to be managed by
Glimcher Properties Limited Partnership, as property manager.  In accordance
with the terms of your lease, copies of all future notices to landlord should be
sent to:

 
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PTC Columbus, LLC
c/o Glimcher Properties Limited Partnership
180 East Broad Street, 21st Floor
Columbus, Ohio 43215
Attention: General Counsel

Also, in accordance with the provisions of your lease, please send an updated
Certificate of Insurance naming the Landlord (PTC Columbus, LLC) as Holder and
additional insured; as well as naming the property manager (Glimcher Properties
Limited Partnership) as additional insured parties.  The Certificate of
Insurance should be sent to Landlord, Attention: Risk Management, at the address
above.

Enclosed is a copy of an IRS W-9 form certifying the Federal Tax ID number for
Glimcher MJC, LLC, as well as a blank gross sales reporting form, with
instructions, for future use.  Please forward these items to the appropriate
personnel of your company.

If you have any questions or need any additional information, please feel free
to contact the management office at (614) 621-9000.
 

(i)           POLARIS CENTER, LLC,  PTC COLUMBUS, LLC,   a Delaware limited
liability company a Delaware limited liability company         By:  Glimcher
PTC, Inc.,  By:  Polaris Center, LLC,   a Delaware corporation, a Delaware
limited liability company,   its managing member its sole member        
By:______________________________   By:  Glimcher PTC, Inc.,   Kim A. Rieck  a
Delaware corporation,   Senior Vice President its managing member          
By:______________________________       Kim A. Rieck      Senior Vice President
 

 
Enclosures:

(1)           Copy of IRS Form W-9
(2)           Blank Gross Sales Reporting Form
 
 
 

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EXHIBIT C
 
FORM OF RENT ROLL
 
 
 

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EXHIBIT D
 
FORM OF OPERATING STATEMENTS
 
 
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SCHEDULE 4.25

SPECIAL DISCLOSURES RELATING TO CERTAIN OF THE LEASES
 
NONE.
 
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SCHEDULE 9.1
 
REQUIRED REPAIRS
 
REPAIR
 
RESERVE AMOUNT
Concrete Sidewalk Repairs
 
$82,500
Full depth asphalt repairs
 
$180,000

 
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