--------------------------------------------------------------------------------

Exhibit 10.1
 
LOAN AGREEMENT

Dated as of July 18, 2017

Between

IONIS GAZELLE, LLC
as Borrower

and

UBS AG, BY AND THROUGH ITS BRANCH OFFICE AT
1285 AVENUE OF THE AMERICAS, NEW YORK, NEW YORK,
as Lender
 

--------------------------------------------------------------------------------

TABLE OF CONTENTS

         
Page
           
I.
 
DEFINITIONS; PRINCIPLES OF CONSTRUCTION
1
 
Section 1.1.
 
Definitions.
1
 
Section 1.2.
 
Principles of Construction.
33
II.
  THE LOAN
34
 
Section 2.1.
 
The Loan.
34
   
2.1.1
Agreement to Lend and Borrow
34
   
2.1.2
Single Disbursement to Borrower
34
   
2.1.3
The Note
34
   
2.1.4
Use of Proceeds
34
 
Section 2.2.
Interest Rate.
34
   
2.2.1
Interest Rate
34
   
2.2.2
Default Rate
34
   
2.2.3
Interest Calculation
34
   
2.2.4
Usury Savings
35
 
Section 2.3.
 
Loan Payments.
35
   
2.3.1
Payment Before Maturity Date
35
   
2.3.2
Intentionally Omitted.
35
   
2.3.3
Payment on Maturity Date
35
   
2.3.4
Late Payment Charge
35
   
2.3.5
Method and Place of Payment.
35
 
Section 2.4.
 
Prepayments.
36
   
2.4.1
Voluntary Prepayments
36
   
2.4.2
Mandatory Prepayments
36
   
2.4.3
Prepayments After Default
37
   
2.4.4
Prepayment Prior to Defeasance Lockout Expiration Date
37
 
Section 2.5.
 
Defeasance.
37
   
2.5.1
Conditions to Defeasance
38
   
2.5.2
Defeasance Collateral Account
39
   
2.5.3
Successor Borrower
40
 
Section 2.6.
 
Release of Property.
40
   
2.6.1
Release of Property
40
   
2.6.2
Release on Payment in Full.
41
 
Section 2.7.
 
Clearing Account/Cash Management Account.
41
   
2.7.1
Clearing Account.
41
   
2.7.2
Cash Management Account.
42
   
2.7.3
Payments Received Under Cash Management Agreement
43
III.
 
REPRESENTATIONS AND WARRANTIES
44
 
Section 3.1.
 
Borrower Representations.
44
   
3.1.1
Organization.
44
   
3.1.2
Proceedings
44
   
3.1.3
No Conflicts
45
   
3.1.4
Litigation
45
   
3.1.5
Agreements
45
   
3.1.6
Consents
45

 

--------------------------------------------------------------------------------

   
3.1.7
 
Title
45
   
3.1.8
 
No Plan Assets
46
   
3.1.9
 
Compliance
46
   
3.1.10
 
Financial Information
46
   
3.1.11
 
Condemnation
47
   
3.1.12
 
Easements; Utilities and Public Access
47
   
3.1.13
 
Separate Lots
47
   
3.1.14
 
Assessments
47
   
3.1.15
 
Enforceability
47
   
3.1.16
 
Assignment of Leases
47
   
3.1.17
 
Insurance
47
   
3.1.18
 
Licenses
48
   
3.1.19
 
Flood Zone
48
   
3.1.20
 
Physical Condition
48
   
3.1.21
 
Boundaries
48
   
3.1.22
 
Leases
48
   
3.1.23
 
Filing, Recording and Other Taxes
49
   
3.1.24
 
Single Purpose.
49
   
3.1.25
 
Tax Filings
56
   
3.1.26
 
Solvency
56
   
3.1.27
 
Federal Reserve Regulations
57
   
3.1.28
 
Organizational Chart
57
   
3.1.29
 
Bank Holding Company
57
   
3.1.30
 
No Other Debt
57
   
3.1.31
 
Investment Company Act
57
   
3.1.32
 
Intentionally Omitted.
57
   
3.1.33
 
No Bankruptcy Filing
57
   
3.1.34
 
Full and Accurate Disclosure
57
   
3.1.35
 
Foreign Person
58
   
3.1.36
 
No Change in Facts or Circumstances; Disclosure
58
   
3.1.37
 
Management Agreement
58
   
3.1.38
 
Perfection of Accounts
58
   
3.1.39
 
Intentionally Omitted
58
   
3.1.40
 
REA
58
   
3.1.41
 
Patriot Act.
59
   
3.1.42
 
Intentionally Omitted.
60
   
3.1.43
 
No Casualty
60
   
3.1.44
 
Purchase Options
60
   
3.1.45
 
Use of Property
60
   
3.1.46
 
Fiscal Year
60
   
3.1.47
 
Material Agreements.
60
   
3.1.48
 
Other Obligations and Liabilities
60
   
3.1.49
 
Illegal Activity
60
   
3.1.50
 
Underwriting Representations
60
   
3.1.51
 
Employees.
61
   
3.1.52
 
Acquisition Documents.
61

 
ii

--------------------------------------------------------------------------------

   
Section 3.2.
 
Survival of Representations.
61
IV.
BORROWER COVENANTS
61
   
Section 4.1.
 
Borrower Affirmative Covenants.
61
   
4.1.1
Existence; Compliance with Legal Requirements
62
   
4.1.2
Taxes and Other Charges
62
   
4.1.3
Litigation
63
   
4.1.4
Access to Property
63
   
4.1.5
Further Assurances; Supplemental Mortgage Affidavits
63
   
4.1.6
Financial Reporting.
64
   
4.1.7
Title to Property
69
   
4.1.8
Estoppel Statement.
69
   
4.1.9
Leases.
69
   
4.1.10
Alterations
72
   
4.1.11
Existing Project.
73
   
4.1.12
Material Agreements
74
   
4.1.13
Performance by Borrower
74
   
4.1.14
Costs of Enforcement/Remedying Defaults
75
   
4.1.15
Business and Operations
75
   
4.1.16
Landlord Consent Under Ionis Lease
75
   
4.1.17
Intentionally Omitted.
75
   
4.1.18
Handicapped Access.
75
   
4.1.19
Additional Reports
76
   
4.1.20
Notice of Certain Events
76
   
4.1.21
Further Assurances; Power of Attorney
76
   
4.1.22
Taxes on Security
76
   
4.1.23
Intentionally Omitted.
76
   
4.1.24
REA
77
   
4.1.25
Patriot Act Compliance
78
   
4.1.26
Prohibited Entity
78
   
Section 4.2.
Borrower Negative Covenants.
78
   
4.2.1
Liens
78
   
4.2.2
Dissolution
78
   
4.2.3
Change in Business
78
   
4.2.4
Debt Cancellation
78
   
4.2.5
Affiliate Transactions
79
   
4.2.6
Zoning
79
   
4.2.7
Assets
79
   
4.2.8
No Joint Assessment
79
   
4.2.9
Principal Place of Business
79
   
4.2.10
ERISA.
79
   
4.2.11
Material Agreements
80
   
4.2.12
Change of Name, Identity or Structure
80
   
4.2.13
Special Purpose
80
   
4.2.14
Prohibited Person
80
   
4.2.15
Intentionally Omitted.
81
   
4.2.16
REA.
81

 
iii

--------------------------------------------------------------------------------

V.
  INSURANCE, CASUALTY AND CONDEMNATION
81
 
Section 5.1.
 
Insurance.
81
 
5.1.1
Insurance Policies.
81
 
5.1.2
Insurance Company
85
 
5.1.3
Ionis Lease
85
 
Section 5.2.
Casualty and Condemnation.
86
 
5.2.1
Casualty
86
 
5.2.2
Condemnation
86
 
5.2.3
Casualty Proceeds
87
 
Section 5.3.
Delivery of Net Proceeds.
87
 
5.3.1
Minor Casualty or Condemnation
87
 
5.3.2
Major Casualty or Condemnation.
87
VI.
RESERVE FUNDS AND CASH MANAGEMENT
92
 
Section 6.1.
[Reserved].
92
 
Section 6.2.
Tax Funds.
92
 
6.2.1
Deposits of Tax Funds
92
 
6.2.2
Release of Tax Funds.
92
 
Section 6.3.
Insurance Funds.
93
 
6.3.1
Deposits of Insurance Funds
93
 
6.3.2
Release of Insurance Funds.
93
 
Section 6.4.
Capital Expenditure Funds.
94
 
6.4.1
Deposits of Capital Expenditure Funds
94
 
6.4.2
Release of Capital Expenditure Funds.
94
 
6.4.3
Failure to Perform Capital Expenditure Works
96
 
Section 6.5.
Rollover Funds.
96
 
6.5.1
Deposits of Rollover Funds.
96
 
6.5.2
Release of Rollover Funds.
97
 
Section 6.6.
[Reserved].
98
 
Section 6.7.
Excess Cash Flow Funds.
98
 
6.7.1
Deposits of Excess Cash Flow Funds
98
 
6.7.2
Release of Excess Cash Flow Funds.
98
 
Section 6.8.
Reserve Funds.
99
 
6.8.1
Security Interest
99
 
6.8.2
Investments; Income Taxes
99
 
6.8.3
Indemnity
99
 
Section 6.9.
[Reserved].
99
  Section 6.10.
[Reserved].
99
 
Section 6.11.
[Reserved].
99
 
Section 6.12.
[Reserved].
99
 
Section 6.13.
Material Tenant Rollover Funds.
99
 
6.13.1
Deposits of Material Tenant Rollover Funds.
99
 
6.13.2
Release of Material Tenant Rollover Funds.
100
VII.
PROPERTY MANAGEMENT
101
 
Section 7.1.
Management Agreement.
101
 
Section 7.2.
Prohibition Against Termination or Modification.
102
 
Section 7.3.
Replacement of Manager.
102

 
iv

--------------------------------------------------------------------------------

VIII.
TRANSFERS
102
   
Section 8.1.
Transfer or Encumbrance of Property.
102
   
Section 8.2.
Permitted Transfers of Interests in Borrower
106
   
8.2.1
Permitted Transfers Generally.
106
   
8.2.2
Permitted Merger.
107
   
8.2.3
Corporate Transfer.
108
   
8.2.4
Prohibited Entity.
108
   
Section 8.3.
Insolvency Opinion.
108
IX.
 
SALE AND SECURITIZATION OF MORTGAGE
109
   
Section 9.1.
Sale of Mortgage and Securitization.
109
   
Section 9.2.
Securitization Indemnification.
113
   
X.
 
DEFAULTS
116
   
Section 10.1.
Event of Default.
116
   
Section 10.2.
Remedies.
119
   
Section 10.3.
Right to Cure Defaults.
120
   
Section 10.4.
Remedies Cumulative.
120
XI.
 
MISCELLANEOUS
121
   
Section 11.1.
Successors and Assigns.
121
   
Section 11.2.
Lender’s Discretion.
121
   
Section 11.3.
Governing Law.
121
   
Section 11.4.
Modification, Waiver in Writing.
123
   
Section 11.5.
Delay Not a Waiver.
123
   
Section 11.6.
Notices.
123
   
Section 11.7.
Trial by Jury.
124
   
Section 11.8.
Headings.
124
   
Section 11.9.
Severability.
124
   
Section 11.10.
Preferences.
125
   
Section 11.11.
Waiver of Notice.
125
   
Section 11.12.
Remedies of Borrower.
125
   
Section 11.13.
Expenses; Indemnity.
126
   
Section 11.14.
Schedules Incorporated.
127
   
Section 11.15.
Offsets, Counterclaims and Defenses.
127
   
Section 11.16.
No Joint Venture or Partnership.
127
   
Section 11.17.
 
Publicity.
127
   
Section 11.18.
Waiver of Marshalling of Assets.
127
   
Section 11.19.
Waiver of Offsets/Defenses/Counterclaims.
128
   
Section 11.20.
Conflict; Construction of Documents; Reliance.
128
   
Section 11.21.
Brokers and Financial Advisors.
128
   
Section 11.22.
Exculpation.
129
   
Section 11.23.
Prior Agreements.
133
   
Section 11.24.
Servicer.
133
   
Section 11.25.
Joint and Several Liability.
133
   
Section 11.26.
Creation of Security Interest.
133
   
Section 11.27.
Intentionally Omitted.
134
   
Section 11.28.
Set-Off.
134
   
Section 11.29.
Component Notes.
134

 
v

--------------------------------------------------------------------------------

   
Section 11.30.
 
Mezzanine Loan.
135
   
Section 11.31.
 
Approvals; Third Parties; Conditions.
136
   
Section 11.32.
 
Limitation on Liability of Lender’s Officers, Employees, etc.
136
   
Section 11.33.
 
Certain Additional Rights of Lender (VCOC).
137
   
Section 11.34.
 
Acknowledgement and Consent to Bail-In of EEA Financial Institutions.
137
   
Section 11.35.
 
Co-Lenders.
138

 
SCHEDULES
 
Schedule 1.1A
-
Description of REA
 
Schedule 1.1B
-
Investment Policy Guidelines
 
Schedule 3.1.22
-
Rent Roll
 
Schedule 3.1.28
-
Organizational Chart
 
Schedule 4.1.10
-
Existing Project
 
Schedule 9.1(b)
-
Updated Information
 

 
vi

--------------------------------------------------------------------------------

LOAN AGREEMENT

THIS LOAN AGREEMENT, dated as of July 18, 2017 (as amended, restated, replaced,
supplemented or otherwise modified from time to time, this “Agreement”), between
UBS AG, by and through its branch office at 1285 Avenue of the Americas, New
York, New York, having an address at 1285 Avenue of the Americas, 11th Floor,
New York, New York 10019 (together with its successors and assigns,
collectively, “Lender”), and IONIS GAZELLE, LLC, a Delaware limited liability
company having an address at 2855 Gazelle Court, Carlsbad, California 92010
(together with its permitted successors and assigns, collectively, “Borrower”).

All capitalized terms used herein shall have the respective meanings set forth
in Article I hereof.

W I T N E S S E T H :

WHEREAS, Borrower desires to obtain the Loan from Lender; and

WHEREAS, subject to and in accordance with the terms and conditions of this
Agreement and the other Loan Documents and based upon the representations,
warranties, covenants and undertakings of Borrower herein and therein contained,
Lender is willing to make the Loan to Borrower.

NOW, THEREFORE, in consideration of the covenants set forth in this Agreement,
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto hereby agree, represent and warrant
as follows:

I.              DEFINITIONS; PRINCIPLES OF CONSTRUCTION

Section 1.1.           Definitions.

For all purposes of this Agreement, except as otherwise expressly provided:

“Acceptable Accounting Basis” shall mean GAAP, income tax basis, or such other
accounting basis reasonably acceptable to Lender in all cases, consistently
applied, which accounting basis is utilized by Borrower and Guarantor for
purposes of financial reporting in accordance with this Agreement and the other
Loan Documents.

“Acceptable Material Tenant Lease Extension” shall mean an extension or renewal
of a Material Tenant Lease with respect to all of the applicable Material Tenant
Space upon terms and conditions reasonably acceptable to Lender.

“Acceptable Material Tenant Space Re-tenanting Event” shall mean the leasing of
all or a portion of the applicable Material Tenant Space to a replacement Tenant
pursuant to a Lease entered into in accordance with the terms and conditions of
this Agreement on terms reasonably acceptable to Lender.

“Act” shall have the meaning set forth in Section 3.1.24(s) hereof.
 

--------------------------------------------------------------------------------

“Affiliate” shall mean, as to any Person, any other Person that (i) directly or
indirectly, owns twenty percent (20%) or more of legal, beneficial or economic
interests in such Person, (ii) is in Control of, is Controlled by or is under
common ownership or Control with such Person, (iii) is a director or officer of
such Person or of an Affiliate of such Person and/or (iv) is the spouse, issue
or parent of such Person or of an Affiliate of such Person.

“Agreement” shall have the meaning set forth in the introductory paragraph
hereto.

“ALTA” shall mean American Land Title Association or any successor thereto.

“Alteration Threshold” shall mean five percent (5%) of the Outstanding Principal
Balance.

“Annual Budget” shall mean the operating and capital budget for the Property
prepared by Borrower in accordance with Section 4.1.6(h) hereof for the
applicable period or Fiscal Year.

“Appraisal” shall mean an appraisal of the Property in its then “as is”
condition, prepared not more than ninety (90) days prior to the Closing Date (or
other relevant date with respect to an updated Appraisal or an Appraisal) by a
member of the American Institute of Real Estate Appraisers selected by Lender,
which appraisal (i) shall meet the minimum appraisal standards for national
banks promulgated by the Comptroller of the Currency pursuant to Title XI of the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989, as amended
(FIRREA), and (ii) otherwise shall be in form and substance satisfactory to
Lender in its sole and absolute discretion.

“Approved Annual Budget” shall have the meaning set forth in Section 4.1.6(h)
hereof.

“Assignment of Leases” shall mean that certain first priority Assignment of
Leases and Rents, dated as of the date hereof, from Borrower, as assignor, to
Lender, as assignee, 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.

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by
the applicable EEA Resolution Authority in respect of any liability of an EEA
Financial Institution.

“Bail-In Legislation” means, with respect to any EEA Member Country implementing
Article 55 of Directive 2014/59/EU of the European Parliament and of the Council
of the European Union, the implementing law for such EEA Member Country from
time to time which is described in the EU Bail-In Legislation Schedule.

“Bankruptcy Action” shall mean, with respect to any Person, (i) such Person
filing a voluntary petition under the Bankruptcy Law; (ii) the filing of an
involuntary petition against such Person under the Bankruptcy Law, or soliciting
or causing to be solicited petitioning creditors for any involuntary petition
against such Person; (iii) such Person filing an answer consenting to or
otherwise acquiescing in or joining in any involuntary petition filed against
it, by any other Person under the Bankruptcy Law; (iv) such Person consenting to
or acquiescing in or joining in an application for the appointment of a
custodian, receiver, trustee, or examiner for such Person or any portion of the
Property; or (v) such Person making an assignment for the benefit of creditors,
or admitting, in writing or in any legal proceeding, its insolvency or inability
to pay its debts as they become due.
 
2

--------------------------------------------------------------------------------

“Bankruptcy Law” shall mean the U.S. Bankruptcy Code, any other federal, state
or foreign bankruptcy or insolvency law and any comparable foreign laws relating
to bankruptcy, insolvency or creditors’ rights.

“Basic Carrying Costs” shall mean the sum of the following costs associated with
the Property for the applicable period or Fiscal Year: (i) Taxes, (ii) Other
Charges and (iii) Insurance Premiums.

“Borrower” shall have the meaning set forth in the introductory paragraph
hereto.

“Borrower Related Party” shall have the meaning set forth in Section 11.22
hereof.

“Borrower’s Recourse Liabilities” shall have the meaning set forth in Section
11.22 hereof.

“Broker” shall have the meaning set forth in Section 11.21 hereof.

“Business Day” shall mean any day other than a Saturday, a Sunday or a legal
holiday on which national banks are not open for general business in (i) the
State of New York, (ii) the state where the corporate trust office of the
Trustee is located, or (iii) the state where the servicing offices of the
Servicer are located.

“Capital Expenditure Account” shall have the meaning set forth in Section 6.4.1
hereof.

“Capital Expenditure Reserve Waiver Conditions Precedent” shall collectively
mean the following conditions precedent: (i) no Event of Default has occurred
and is continuing, (ii) all of the Property shall be demised pursuant to the
Ionis Lease, (iii) the Ionis Lease is in full force and effect, (iv) no Material
Tenant Trigger Event shall have occurred and be continuing, (v) Ionis is
expressly obligated pursuant to the terms and conditions of the Ionis Lease to
maintain the Property in a condition reasonably acceptable to Lender, and (vi)
Ionis performs its obligation as described in clause (v) above in a timely
manner and Borrower provides evidence, in form and substance reasonably
satisfactory to Lender, of such performance by Ionis in a timely manner.

“Capital Expenditure Funds” shall have the meaning set forth in Section 6.4.1
hereof.

“Capital Expenditure Work” shall mean any labor performed or materials provided
or installed in connection with any Capital Expenditures.
 
3

--------------------------------------------------------------------------------

“Capital Expenditures” shall mean, for any period, the amounts expended for
items required to be capitalized under GAAP (including expenditures for
replacements, building improvements, major repairs, alterations, tenant
improvements and leasing commissions).

“Cash Management Account” shall have the meaning set forth in Section 2.7.2
hereof.

“Cash Management Activation Notice” shall mean a written notice from Lender or
Servicer to Clearing Bank stating that a Cash Management Trigger Event has
occurred and instructing Clearing Bank to transfer all available funds in the
Clearing Account to the Cash Management Account in accordance with the Clearing
Account Agreement.

“Cash Management Agreement” shall mean that certain Cash Management Agreement,
dated as of the date hereof, among Lender, Borrower and Cash Management Bank, as
the same may be amended, restated, replaced, supplemented or otherwise modified
from time to time.

“Cash Management Bank” shall mean Wells Fargo Bank, N.A. or any successor
Eligible Institution acting as Cash Management Bank under the Cash Management
Agreement.

“Cash Management De-Activation Notice” shall mean a written notice from Lender
or Servicer to Clearing Bank stating that a Cash Management Trigger Event no
longer exists and instructing Clearing Bank to transfer all available funds in
the Clearing Account to an account designated by Borrower in accordance with the
Clearing Account Agreement.

“Cash Management DSCR Trigger Event” shall mean that, as of any date on which
Lender determines the Debt Service Coverage Ratio, the Debt Service Coverage
Ratio is less than 1.25 to 1.0.

“Cash Management Trigger Event” shall mean the occurrence of:

(i)         an Event of Default;

(ii)        any Bankruptcy Action of Borrower;
 
(iii)        any Bankruptcy Action of Guarantor;

(iv)       any Bankruptcy Action of Manager;
       

(v)        any Bankruptcy Action of Sponsor;

(vi)       a Cash Management DSCR Trigger Event;

(vii)      a Material Tenant Trigger Event;

(viii)     a Manager Trigger Event; or

(ix)       an Indictment Trigger Event.

“Cash Management Trigger Event Cure” shall mean:
 
4

--------------------------------------------------------------------------------

(i)        if the Cash Management Trigger Event is caused solely by the
occurrence of clause (i) in the definition of “Cash Management Trigger Event,” a
cure of the Event of Default which is accepted or waived in writing by Lender
(which acceptance shall not be unreasonably withheld, conditioned or delayed)
which gave rise to such Cash Management Trigger Event; provided that Lender
shall not have exercised any of its rights under Section 10.2 hereof to
accelerate the Loan, move to appoint a receiver or commence a foreclosure
action;
 
(ii)       if the Cash Management Trigger Event is caused solely by the
occurrence of clause (ii) in the definition of “Cash Management Trigger Event,”
if such Cash Management Trigger Event is as a result of the filing of an
involuntary petition against Borrower with respect to which neither Borrower,
Guarantor nor any Affiliate of Borrower or Guarantor solicited or caused to be
solicited petitioning creditors or consented to or otherwise acquiesced in or
joined in such involuntary petition, upon the same being discharged, stayed or
dismissed within ninety (90) days of such filing; provided that Borrower is not
in Default of the provisions set forth in Section 3.1.24 hereof or Section 8.1
hereof;
 
(iii)       if the Cash Management Trigger Event is caused solely by the
occurrence of clause (iii) in the definition of “Cash Management Trigger Event,”
if such Cash Management Trigger Event is as a result of the filing of an
involuntary petition against Guarantor with respect to which neither Guarantor
nor any Affiliate of Guarantor solicited or caused to be solicited petitioning
creditors or consented to or otherwise acquiesced in or joined in such
involuntary petition, upon the same being discharged, stayed or dismissed within
ninety (90) days of such filing;
 
(iv)       if the Cash Management Trigger Event is caused solely by the
occurrence of clause (iv) in the definition of “Cash Management Trigger Event,”
(A) if Borrower replaces Manager with a Qualified Manager pursuant to a
Replacement Management Agreement, or (B) if such Cash Management Trigger Event
is as a result of the filing of an involuntary petition against Manager with
respect to which neither Manager nor any Affiliate of Manager solicited or
caused to be solicited petitioning creditors or consented to or otherwise
acquiesced in or joined in such involuntary petition, upon the same being
discharged, stayed or dismissed within one hundred twenty (120) days of such
filing;
 
(v)       if the Cash Management Trigger Event is caused solely by the
occurrence of clause (v) in the definition of “Cash Management Trigger Event,”
if such Cash Management Trigger Event is as a result of the filing of an
involuntary petition against Sponsor with respect to which neither Sponsor nor
any Affiliate of Sponsor solicited or caused to be solicited petitioning
creditors or consented to or otherwise acquiesced in or joined in such
involuntary petition, upon the same being discharged, stayed or dismissed within
ninety (90) days of such filing;
 
(vi)      if the Cash Management Trigger Event is caused solely by the
occurrence of clause (vi) in the definition of “Cash Management Trigger Event,”
once the Debt Service Coverage Ratio is equal to or greater than 1.25 to 1:0 for
each of two (2) consecutive quarters;
 
5

--------------------------------------------------------------------------------

(vii)      if the Cash Management Trigger Event is caused solely by the
occurrence of clause (vii) in the definition of “Cash Management Trigger Event,”
the occurrence of a Material Tenant Trigger Event Cure and, after giving effect
to such Material Tenant Trigger Event Cure, no other Material Tenant Trigger
Event shall have occurred with respect to which a Material Tenant Trigger Event
Cure has not occurred;
 
(viii)     if the Cash Management Trigger Event is caused solely by the
occurrence of clause (viii) in the definition of “Cash Management Trigger
Event,” if Borrower engages a Qualified Manager pursuant to a Management
Agreement or Borrower replaces Manager with a Qualified Manager pursuant to a
Replacement Management Agreement, as applicable; and
 
(ix)       if the Cash Management Trigger Event is caused solely by the
occurrence of clause (ix) in the definition of “Cash Management Trigger Event,”
upon judicial determination pursuant to a final, non-appealable judgment, that
no such fraud or misappropriation of funds has occurred,

provided that each Cash Management Trigger Event Cure set forth above shall be
subject to the following conditions: (1) after giving effect to such Cash
Management Trigger Event Cure, no Cash Management Trigger Event shall have
occurred and remain outstanding, (2) Borrower shall have notified Lender in
writing of its election to cure the applicable Cash Management Trigger Event,
(3) a Cash Management Trigger Event Cure may occur no more than six (6) times
during the term of the Loan, and (4) Borrower shall have paid all of Lender’s
reasonable costs and expenses incurred in connection with such Cash Management
Trigger Event Cure (including reasonable attorneys’ fees and expenses).

“Cash Management Trigger Event Period” shall mean any period commencing on the
occurrence of a Cash Management Trigger Event and continuing until the earlier
of (i) the Monthly Payment Date following the occurrence of the applicable Cash
Management Trigger Event Cure or (ii) the payment in full of all principal and
interest on the Loan and all other amounts payable under the Loan Documents in
accordance with the terms and provisions of the Loan Documents.

“Cash Sweep DSCR Trigger Event” shall mean that, as of any date on which Lender
determines the Debt Service Coverage Ratio, the Debt Service Coverage Ratio is
less than 1.20 to 1.0.

“Cash Sweep Trigger Event” shall mean the occurrence of:

(i)         an Event of Default;
 
(ii)        any Bankruptcy Action of Borrower;
 
(iii)       any Bankruptcy Action of Guarantor;
 
6

--------------------------------------------------------------------------------

(iv)       any Bankruptcy Action of Manager;
 
(v)        any Bankruptcy Action of Sponsor; or
 
(vi)      a Cash Sweep DSCR Trigger Event.

“Cash Sweep Trigger Event Cure” shall mean:

(i)         if the Cash Sweep Trigger Event is caused solely by the occurrence
of clause (i) in the definition of “Cash Sweep Trigger Event,” a cure of the
Event of Default which is accepted or waived in writing by Lender which gave
rise to such Cash Sweep Trigger Event; provided that Lender shall not have
exercised any of its rights under Section 10.2 hereof to accelerate the Loan,
move to appoint a receiver or commence a foreclosure action;
 
(ii)        if the Cash Sweep Trigger Event is caused solely by the occurrence
of clause (ii) in the definition of “Cash Sweep Trigger Event,” if such Cash
Sweep Trigger Event is as a result of the filing of an involuntary petition
against Borrower with respect to which neither Borrower, Guarantor nor any
Affiliate of Borrower or Guarantor solicited or caused to be solicited
petitioning creditors or consented to or otherwise acquiesced in or joined in
such involuntary petition, upon the same being discharged, stayed or dismissed
within ninety (90) days of such filing;
 
(iii)       if the Cash Sweep Trigger Event is caused solely by the occurrence
of clause (iii) in the definition of “Cash Sweep Trigger Event,” if such Cash
Sweep Trigger Event is as a result of the filing of an involuntary petition
against Guarantor with respect to which neither Guarantor nor any Affiliate of
Guarantor solicited or caused to be solicited petitioning creditors or consented
to or otherwise acquiesced in or joined in such involuntary petition, upon the
same being discharged, stayed or dismissed within ninety (90) days of such
filing;
 
(iv)       if the Cash Sweep Trigger Event is caused solely by the occurrence of
clause (iv) in the definition of “Cash Sweep Trigger Event,” (A) if Borrower
replaces Manager with a Qualified Manager pursuant to a Replacement Management
Agreement, or (B) if such Cash Sweep Trigger Event is as a result of the filing
of an involuntary petition against Manager to which Manager did not consent,
upon the same being discharged, stayed or dismissed within one hundred twenty
(120) days of such filing; and
 
(v)        if the Cash Sweep Trigger Event is caused solely by the occurrence of
clause (v) in the definition of “Cash Sweep Trigger Event,” if such Cash Sweep
Trigger Event is as a result of the filing of an involuntary petition against
Sponsor with respect to which neither Sponsor nor any Affiliate of Sponsor
solicited or caused to be solicited petitioning creditors or consented to or
otherwise acquiesced in or joined in such involuntary petition, upon the same
being discharged, stayed or dismissed within ninety (90) days of such filing;
 
7

--------------------------------------------------------------------------------

(vi)       if the Cash Sweep Trigger Event is caused solely by the occurrence of
clause (v) in the definition of “Cash Sweep Trigger Event,” once the Debt
Service Coverage Ratio is equal to or greater than 1.20 to 1:0 for each of two
(2) consecutive quarters;

provided that each Cash Sweep Trigger Event Cure set forth above shall be
subject to the following conditions: (1) after giving effect to such Cash Sweep
Trigger Event Cure, no Cash Sweep Trigger Event shall have occurred and remain
outstanding, (2) Borrower shall have notified Lender in writing of its election
to cure the applicable Cash Sweep Trigger Event, and (3)  Borrower shall have
paid all of Lender’s reasonable costs and expenses incurred in connection with
such Cash Sweep Trigger Event Cure (including reasonable attorneys’ fees and
expenses).

“Cash Sweep Trigger Event Period” shall mean any period commencing on the
occurrence of a Cash Sweep Trigger Event and continuing until the earlier of (i)
the Monthly Payment Date following the occurrence of the applicable Cash Sweep
Trigger Event Cure or (ii) the payment in full of all principal and interest on
the Loan and all other amounts payable under the Loan Documents in accordance
with the terms and provisions of the Loan Documents.

“Casualty” shall mean any casualty, damage or injury, by fire or otherwise, to
the Property or any part thereof.

“Casualty Consultant” shall have the meaning set forth in Section 5.3.2(c)
hereof.

“Casualty Retainage” shall have the meaning set forth in Section 5.3.2(d)
hereof.

“Cause” shall mean, with respect to an Independent Director, (i) any acts or
omissions by such Independent Director that constitute systematic, persistent or
willful disregard of, or gross negligence with respect to, such Independent
Director’s duties, or (ii) such Independent Director has engaged in or has been
charged with or has been indicted or convicted for any crime or crimes of moral
turpitude or dishonesty or other acts constituting a crime under any law
applicable to such Independent Director or for any violation of any Legal
Requirements (iii) such Independent Director has intentionally breached its
fiduciary duties of loyalty and care as and to the extent of such duties set
forth in the Organizational Documents, (iv) there is a material increase in the
fees charged by such Independent Director (which, for purposes of this
Agreement, shall be an increase of one hundred percent (100%) or more) or a
material change to such Independent Director’s terms of service, (v) such
Independent Director is unable to perform his or her duties as Independent
Director due to death, disability or incapacity, or (vi) such Independent
Director no longer meets the definition of Independent Director.

“Clearing Account” shall have the meaning set forth in Section 2.7.1 hereof.

“Clearing Account Agreement” shall mean that certain Deposit Account Control
Agreement, dated as of the date hereof, among Lender, Borrower, Manager and
Clearing Bank, as the same may be amended, restated, replaced, supplemented or
otherwise modified from time to time.
 
8

--------------------------------------------------------------------------------

“Clearing Bank” shall mean Wells Fargo Bank, N.A. or any successor Eligible
Institution acting as Clearing Account Bank under the Clearing Account
Agreement.

“Closing Date” shall mean the date hereof.

“Co-Lender” shall mean each holder of a Note.

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

“Condemnation” shall mean a temporary or permanent taking by any Governmental
Authority as the result or 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 of Borrower's interest therein or right accruing thereto, including any
right of access thereto or any change of grade affecting the Property or any
part thereof.

“Control” shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management, policies or activities of a
Person, whether through ownership of voting securities, by contract or otherwise
and the terms “Controlled” and “Controlling” shall have correlative meanings.

“Crowdfunding” means, any offer or sale of equity or debt securities of any
Person involving or relating to direct or indirect interests, or any combination
of direct or indirect interests, in such Person, that is conducted or proposed
to be conducted via the internet or through the use of other general
solicitation or advertising of the investment opportunity to prospective
investors by the issuer of such securities or an online or other funding portal
in a transaction or series of transactions intended to be exempt from the
registration requirements of the Securities Act of 1933, as amended, including
but not limited to pursuant to the exemptions provided by Section 4(a)(6)
thereof or Rule 506(c) promulgated thereunder, any other similar state
securities law, or any similar transaction.

“Debt” shall mean the Outstanding Principal Balance, 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 or any other Loan Document.

“Debt Service” shall mean, with respect to any particular period of time, the
aggregate amount of scheduled principal and interest payments due and payable
under the Note and this Agreement.

“Debt Service Coverage Ratio” shall mean the ratio, as determined by Lender,
based on the trailing twelve (12) calendar month period immediately preceding
the date of such determination, in which:

(i)         the numerator is the Net Operating Income (excluding interest on
credit accounts) for such period, without deduction for (a) actual management
fees incurred in connection with the operation of the Property during such
period or (b) actual amounts paid to the Reserve Funds during such period, less
(1) management fees equal to the greater of (A) assumed management fees of
percent (3%) of Gross Income from Operations during such period and (B) the
actual management fees incurred during such period, (2) Capital Expenditure Fund
contributions for such period based on an assumed annual amount equal to $0.20
per square foot of gross leasable area at the Property, (3) tenant improvements
and leasing commissions for such period based on an assumed annual amount equal
to $2.00 per square foot of gross leasable area at the Property and (4) a
vacancy allowance based on the greater of (A) an assumed vacancy rate of 5% and
(B) the actual vacancy at the Property; and
 
9

--------------------------------------------------------------------------------

 (ii)       the denominator is the aggregate Debt Service due and payable during
such period; provided that if scheduled principal payments are not due for the
entirety of such period (i.e., on each Monthly Payment Date that occurs during
such period), such aggregate Debt Service shall be determined based on a payment
constant based on the Interest Rate and an amortization period of thirty (30)
years.

It is acknowledged and agreed that, for so long as the Ionis Lease Condition
remains satisfied, (x) the determination of the Debt Service Coverage Ratio
shall not be required, and (y) each requirement, covenant or threshold contained
herein requiring a Debt Service Coverage Ratio calculation s shall be deemed
waived.

“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 mean, with respect to the Loan, a rate per annum equal to
the lesser of (i) the Maximum Legal Rate or (ii) five percent (5%) above the
Interest Rate.

“Defeasance Collateral” shall mean, in connection with the Defeasance Event,
U.S. Obligations which provide payments (i) on or prior to, but as close as
possible to, the Business Day immediately preceding all scheduled Monthly
Payment Dates and other scheduled payment dates, if any, under the Note after
the Defeasance Date upon which payments are required under the Note and this
Agreement, and (ii) in amounts equal to the scheduled payments due on such
Monthly Payment Dates or other scheduled payment dates under the Note and this
Agreement (including, without limitation, scheduled payments of principal,
interest, servicing fees (if any), and any other amounts due under the Loan
Documents on such Monthly Payment Dates or other scheduled payment dates);
provided that the Note shall be deemed, for purposes of this definition, to be
due and payable and shall be prepaid in full on the Open Prepayment Commencement
Date (such scheduled payments, collectively, the “Scheduled Defeasance
Payments”).

“Defeasance Collateral Account” shall have the meaning set forth in Section
2.5.2 hereof.

“Defeasance Date” shall have the meaning set forth in Section 2.5.1(a) hereof.

“Defeasance Event” shall have the meaning set forth in Section 2.5.1 hereof.
 
10

--------------------------------------------------------------------------------

“Defeasance Lockout Expiration Date” shall mean the date that is two (2) years
from the “startup day” within the meaning of Section 860G(a)(9) of the Code for
the Securitization Vehicle established in connection with the last
Securitization involving any portion of the Loan.

“Defeasance Security Agreement” shall mean a pledge and security agreement in
form and substance that would be reasonably satisfactory to a prudent lender
pursuant to which Borrower grants Lender a perfected, first priority security
interest in the Defeasance Collateral Account and the Defeasance Collateral.

“Disclosure Documents” shall mean, collectively, any written materials used or
provided to any prospective investors and/or NRSROs in connection with any
public offering or private placement in connection with a Securitization
(including, without limitation, a prospectus, prospectus supplement, private
placement memorandum, offering memorandum, offering circular, term sheet, road
show presentation materials or other offering documents, marketing materials or
information provided to prospective investors), in each case in preliminary or
final form and including any amendments, supplements, exhibits, annexes and
other attachments thereto.

“EEA Financial Institution” means (a) any credit institution or investment firm
established in any EEA Member Country which is subject to the supervision of an
EEA Resolution Authority, (b) any entity established in an EEA Member Country
which is a parent of an institution described in clause (a) of this definition,
or (c) any financial institution established in an EEA Member Country which is a
subsidiary of an institution described in clauses (a) or (b) of this definition
and is subject to consolidated supervision with its parent.

“EEA Member Country” means any of the member states of the European Union,
Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” means any public administrative authority or any
person entrusted with public administrative authority of any EEA Member Country
(including any delegee) having responsibility for the resolution of any EEA
Financial Institution.

“Eligible Account” shall mean a separate and identifiable account from all other
funds held by the holding institution that is either (i) an account or accounts
(or subaccounts thereof) maintained with a federal or state-chartered depository
institution or trust company which complies with the definition of Eligible
Institution or (ii) a segregated trust account or accounts (or subaccounts
thereof) maintained with a federal or state chartered depository institution or
trust company acting in its fiduciary capacity that has a Moody’s rating of at
least “Baa3” and that, 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 and 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 Letters of Credit or
accounts in which funds are held for more than thirty (30) days, the long term
unsecured debt obligations of which are rated at least “A” by S&P, “A2” by
Moody’s and “A” by Fitch.
 
11

--------------------------------------------------------------------------------

“Environmental Indemnity” shall mean that certain Environmental Indemnity
Agreement, dated as of the date hereof, executed by Borrower and Guarantor in
connection with the Loan for the benefit of Lender, as the same may be amended,
restated, replaced, supplemented or otherwise modified from time to time.

“Environmental Law” shall have the meaning set forth in the Environmental
Indemnity.

“ERISA” shall have the meaning set forth in Section 4.2.10 hereof.

“ESA” shall have the meaning set forth in Section 3.1.50(d) hereof.

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule
published by the Loan Market Association (or any successor person), as in effect
from time to time.

“Event of Default” shall have the meaning set forth in Section 10.1 hereof.

“Excess Cash Flow” shall have the meaning set forth in Section 2.7.2 hereof.

“Excess Cash Flow Account” shall have the meaning set forth in Section 6.7.1
hereof.

“Excess Cash Flow Funds” shall have the meaning set forth in Section 6.7.1
hereof.

“Exchange Act” shall have the meaning set forth in Section 9.2(a) hereof.

“Exchange Act Filing” shall mean a filing pursuant to the Exchange Act in
connection with or relating to a Securitization.

“Executive Order” shall mean an Executive Order of the President of the United
States of America.

“Existing Project” shall mean, collectively, certain capital improvements and
renovations being performed at the Property, as more particularly set on
Schedule 4.1.10 attached hereto.

“Equipment” shall have the meaning set forth in the granting clause of the
Security Instrument.

“Extraordinary Expense” shall have the meaning set forth in Section 4.1.6(h)
hereof.

“Extraordinary Lease Payments” shall have the meaning set forth in Section
6.5.1(b) hereof.
 
12

--------------------------------------------------------------------------------

“Fiscal Year” shall mean each twelve (12) month period commencing on January 1
and ending on December 31 during each year of the Term.

“Fitch” shall mean Fitch, Inc.

“GAAP” shall mean generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board (or agencies with similar functions of
comparable stature and authority within the accounting profession), or in such
other statements by such entity as may be in general use by significant segments
of the U.S. accounting profession.

“Government Lists” shall mean, collectively, (i) the Specially Designated
Nationals and Blocked Persons Lists maintained by OFAC, (ii) any other list of
terrorists, terrorist organizations or narcotics traffickers maintained pursuant
to any of the Rules and Regulations of OFAC, and (iii) any similar lists
maintained by the United States Department of State, the United States
Department of Commerce or any other Governmental Authority or pursuant to any
Executive Order.

“Governmental Authority” shall mean any court, agency, board, bureau,
commission, department, office or other authority of any nature whatsoever of
any governmental unit (foreign, federal, state, county, district, municipal,
city or otherwise) whether now or hereafter in existence.

“Grantor Trust” shall mean a grantor trust under Subpart E of Part 1 of
Subchapter J of the Code.

“Gross Income from Operations” shall mean, for any period, all sustainable
income, computed in accordance with the Acceptable Accounting Basis, derived
from the ownership and operation of the Property from whatever source during
such period, including, but not limited to, Rents, utility charges, escalations,
forfeited security deposits, interest on credit accounts, service fees or
charges, license fees, parking fees, and other pass-through or reimbursements
paid by tenants under the Leases of any nature, but excluding Rents from
month-to-month tenants, tenants that are included as debtors in any Bankruptcy
Action, tenants whose lease guarantors are included as debtors in any Bankruptcy
Action, tenants that have given notice of their intention to terminate or not
extend or renew their Leases (unless, subsequent to such notice, the applicable
tenant has extended or renewed its Lease or entered into a new Lease or
rescinded such notice in writing), or tenants that have “gone dark”, vacated,
ceased to occupy or discontinued their operations at the Property (other than
temporary cessation of operations in connection with remodeling, renovation or
restoration of their leased premises), Extraordinary Lease Payments, sales, use
and occupancy or other taxes on receipts required to be accounted for by
Borrower to any Governmental Authority, rent concessions, credits, and free
rent, refunds and uncollectible accounts, sales of furniture, fixtures and
equipment, Net Proceeds (other than business or rental interruption or other
loss of income insurance proceeds to the extent Lender elects to treat such
Insurance Proceeds as business or rental interruption Insurance Proceeds that
replace lost Rents for such period in accordance with Section 5.2.3 hereof),
unforfeited security deposits, utility and other similar deposits and any
disbursements to Borrower from the Reserve Funds, if any.
 
13

--------------------------------------------------------------------------------

“Guarantor” shall mean Ionis.

“Guaranty” shall mean that certain Guaranty, dated as of the date hereof,
executed by Guarantor in connection with the Loan for the benefit of Lender, as
the same may be amended, restated, replaced, supplemented or otherwise modified
from time to time.

“Hazardous Substances” shall have the meaning set forth in the Environmental
Indemnity.

“Improvements” shall have the meaning set forth in the granting clause of the
Security Instrument.

“Indebtedness” shall mean, for any Person, without duplication: (i) all
indebtedness or liability of such Person (including, without limitation, for
borrowed money, for amounts drawn under a letter of credit, or for deferred
purchase price of property or services (including trade obligations) for which
such Person or its assets is liable), (ii) all unfunded amounts under a loan
agreement, letter of credit, or other credit facility for which such Person
would be liable if such amounts were advanced thereunder, (iii) all amounts
required to be paid by such Person pursuant to any agreement to purchase, to
provide funds for payment, to supply funds, or to invest in any Person, (iv) all
indebtedness or liabilities guaranteed by such Person, directly or indirectly,
(v) all obligations under leases that constitute capital leases for which such
Person is liable, and (vi) all obligations of such Person under interest rate
swaps, caps, floors, collars and other interest hedge agreements, in each case
whether such Person is liable contingently or otherwise, as obligor, guarantor
or otherwise, or in respect of which obligations such Person otherwise assures
any other Person against loss.

“Indemnified Liabilities” shall have the meaning set forth in Section 11.13(b)
hereof.

“Independent Director” shall have the meaning set forth in Section 3.1.24(o)
hereof.

“Indictment Trigger Event” shall mean the occurrence of an indictment for fraud
or misappropriation of funds by Borrower or any Guarantor or any director or
officer of Borrower or any Guarantor.

 “Insolvency Opinion” shall mean, as the context may require, (i) that certain
bankruptcy non-consolidation opinion letter, dated the date hereof, rendered by
Richards, Layton & Finger, P.A. in connection with the Loan or (ii) any other
bankruptcy non-consolidation opinion delivered to Lender in connection with the
Loan (including any bankruptcy non-consolidation opinion delivered to Lender
subsequent to the closing of the Loan in accordance with the Loan Documents).

“Insurance Account” shall have the meaning set forth in Section 6.3.1 hereof.

“Insurance Funds” shall have the meaning set forth in Section 6.3.1 hereof.

“Insurance Premiums” shall have the meaning set forth in Section 5.1.1(b)
hereof.
 
14

--------------------------------------------------------------------------------

“Insurance Proceeds” shall mean the amount of all insurance proceeds paid under
the Policies.

“Insurance Reserve Waiver Conditions Precedent” shall mean the following
conditions precedent: (i) no Event of Default has occurred and is continuing,
(ii) all of the Property shall be demised pursuant to the Ionis Lease, (iii) the
Ionis Lease is in full force and effect, (iv) no Material Tenant Trigger Event
shall have occurred and be continuing, (v) Ionis is obligated pursuant to the
terms and conditions of the Ionis Lease to maintain insurance, and with
insurance companies, that satisfy the requirements set forth in Article V
hereof, and (vi) Ionis performs its obligation under clause (v) above in a
timely manner and Borrower provides evidence, in form and substance reasonably
satisfactory to Lender, of such performance by Ionis in a timely manner.

“Interest Period” shall mean, with respect to any Monthly Payment Date, the
period commencing on the eleventh (11th) day of the preceding calendar month and
terminating on the tenth (10th) day of the calendar month in which such Monthly
Payment Date occurs; provided, however, that the initial Interest Period shall
begin on the Closing Date and shall end on the immediately following tenth
(10th) day of a calendar month.

“Interest Rate” shall mean a rate per annum equal to three and eight hundred
eighty-one thousandths percent (3.881%).

“Investment Grade” shall mean a long term unsecured debt rating of at least
“BBB-” by S&P, “Baa3” by Moody’s and “BBB-” by Fitch (or its equivalent by the
other Rating Agencies).

“Ionis” shall mean Ionis Pharmaceuticals, Inc., a Delaware corporation.

“Ionis Lease” shall mean that certain Lease Agreement, dated as of the date
hereof, between Ionis, as tenant and Borrower, as landlord, demising the entire
Property to Ionis, as the same may be amended, restated, replaced, supplemented
or otherwise modified from time to time in accordance with the terms of this
Agreement.

“Ionis Lease Condition” shall mean all of the following: (i) the Property is, as
of the applicable date of determination, subject to the Ionis Lease, (ii) no
default under the Ionis Lease shall have occurred and is continuing beyond
applicable notice and cure periods expressly set forth in the Ionis Lease, (iii)
the Ionis Lease is in full force and effect, (iv) no Material Tenant Trigger
Event with respect to the Ionis Lease has occurred and is continuing, and (v)
Ionis is paying full unabated rent pursuant to the terms of the Ionis Lease and
is otherwise performing all of its obligations under the Ionis Lease in a timely
manner and otherwise pursuant to the express terms of the Ionis Lease.

“Ionis Reporting Condition” shall mean all of the following: (i) Ionis remains a
publicly traded company whose shares of stock are listed on the New York Stock
Exchange or another nationally recognized stock exchange located within the
United States, (ii) Ionis is subject to the reporting requirements under the
Exchange Act, (iii) Ionis complies with such reporting requirements, and (iv)
Ionis’ annual financial statements are audited by a “Big Four” accounting firm
or other independent certified public accountant acceptable to Lender.
 
15

--------------------------------------------------------------------------------

“Ionis Sublease” shall mean a written sublease of a portion of the Property (not
to exceed twenty-five percent (25%) in the aggregate of the total rentable
square footage at the Property) by Ionis, as sublandlord, to a wholly owned
subsidiary of Ionis (or a subsidiary majority owned and Controlled by Ionis), as
subtenant.

“Land” shall have the meaning set forth in the granting clause of the Security
Instrument.

“Lease” shall mean any lease, sublease, subsublease, letting, license,
concession or other agreement (whether written or oral and whether now or
hereafter in effect) pursuant to which any Person is granted a possessory
interest in, or right to use or occupy all or any portion of any space in the
Property, and every modification, amendment or other agreement relating to such
lease, sublease, subsublease, letting, license, concession or other agreement
and every guarantee of the performance and observance of the covenants,
conditions and agreements to be performed and observed by the other party
thereto.

“Legal Requirements” shall mean all federal, state, county, municipal and other
governmental statutes, laws, rules, orders, regulations, ordinances, judgments,
decrees, demands and injunctions of Governmental Authorities affecting the Loan,
any Secondary Market Transactions with respect to the Loan, Borrower, Guarantor
or the Property or any part thereof or the ownership, construction, alteration,
use, management or operation of the Property or any part thereof, whether now or
hereafter enacted and in force, including, without limitation, the Securities
Act, the Exchange Act, Regulation AB, the rules and regulations promulgated
pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act,
zoning and land use laws and the Americans with Disabilities Act of 1990, and
all permits, licenses and 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 Borrower, Guarantor or the Property or any part thereof, including,
without limitation, any which may (i) require repairs, modifications or
alterations in or to the Property or any part thereof or (ii) in any way limit
the use and enjoyment thereof.

“Lender” shall have the meaning set forth in the introductory paragraph hereto.

“Lender Indemnitees” shall mean (i) Lender, (ii) any Affiliate of Lender that
has filed any registration statement relating to a Securitization or has acted
as the sponsor or depositor in connection with such Securitization, (iii) any
Affiliate of Lender that acts as an underwriter, placement agent or initial
purchaser in connection with a Securitization, (iv) any other co-underwriters,
co-placement agents or co-initial purchasers in connection with a
Securitization, (v) each Person who Controls (within the meaning of Section 15
of the Exchange Act) any Person described in any of the foregoing clauses, (vi)
any Person who is or will have been involved in the origination of the Loan,
(vii) any Person who is or will have been involved in the servicing of the Loan,
(viii) any Person in whose name the Lien created by the Security Instrument and
the other Loan Documents are or will be recorded or filed, (ix) any Person who
may hold or acquire or will have held a full or partial interest in the Loan
(including, but not limited to, investors or prospective investors in the
Securities, as well as custodians, trustees and other fiduciaries who hold or
have held a full or partial interest in the Loan evidenced for the benefit of
third parties), (x) any Person who holds or acquires or will have held a
participation or other full or partial interest in the Loan, whether during the
term of the Loan or as a part of or following a foreclosure of the Loan, (xi)
any successors by merger, consolidation or acquisition of all or a substantial
portion of Lender’s assets and business and (xii) the respective officers,
directors, shareholders, partners, members, employees, agents, representatives,
contractors, subcontractors, Affiliates, participants, successors and assigns of
any Person described in any of the foregoing clauses.
 
16

--------------------------------------------------------------------------------

“Letter of Credit” shall mean an irrevocable, unconditional, transferable
(without payment of any transfer fee), clean sight draft letter of credit
reasonably acceptable to Lender and the Rating Agencies (either an evergreen
letter of credit or one which does not expire until at least thirty (30) days
after (i) the Stated Maturity Date or (ii) such earlier date as such Letter of
Credit is no longer required pursuant to the terms of this Agreement and the
other Loan Documents) in favor of Lender and entitling Lender to draw thereon in
New York, New York based solely on a statement purportedly executed by an
officer of Lender stating that it has the right to draw thereon, issued by a
domestic Eligible Institution or the U.S. agency or branch of a foreign Eligible
Institution.  If at any time the bank issuing any such Letter of Credit shall
cease to be an Eligible Institution, Lender shall have the right immediately to
draw down the same in full and hold the proceeds of such draw in accordance with
the applicable provisions of this Agreement.

“Lien” shall mean any mortgage, deed of trust, deed to secure debt, indemnity
deed of trust, lien (statutory or otherwise), pledge, hypothecation, assignment,
security interest, easement, restrictive covenant, preference, or any other
encumbrance (other than a Permitted Encumbrance), charge or transfer of, or any
agreement to enter into or create any of the foregoing affecting (i) all or any
portion of the Property or any interest therein or (ii) any direct or indirect
interest in Borrower, 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, materialman’s and other similar liens and
encumbrances.

“Liquid Asset” shall mean any of the following, but only to the extent owned
individually, free of all security interests, liens, pledges, charges or any
other encumbrance: (a) cash, (b) certificates of deposit (with a maturity of two
years or less) issued by, or savings account with, any bank or other financial
institution reasonably acceptable to Lender, (c) marketable securities listed on
a national or international exchange reasonably acceptable to Lender, marked to
market, or (d) solely with respect to Ionis, such securities or other liquid
assets acquired by Ionis pursuant to the terms of that certain Investment Policy
Guidelines provided to Lender prior to the date hereof and attached hereto as
Schedule 1.1(B), as may be updated from time to time, subject to Lender’s
reasonable approval (not to be unreasonably withheld, conditioned or delayed).

“Loan” shall mean the loan in the original principal amount of Fifty-One Million
Three Hundred Fifty Thousand and No/100 Dollars ($51,350,000.00) made by Lender
to Borrower pursuant to this Agreement.

“Loan Documents” shall mean, collectively, this Agreement, the Note, the
Security Instrument, the Assignment of Leases, the Guaranty, the Environmental
Indemnity, the Assignment of Management Agreement, the Cash Management
Agreement, the Clearing Account Agreement, and all other documents, agreements,
certificates and instruments now or hereafter executed and/or delivered in
connection with the Loan.
 
17

--------------------------------------------------------------------------------

“Loan-to-Value Ratio” shall mean a ratio, as of a particular date, in which: (i)
the numerator is equal to the Outstanding Principal Balance and (ii) the
denominator is equal to the appraised value of the Property based on an
Appraisal.

“Major Lease” shall mean any Lease which (i) either individually or when taken
together with any other Lease with the same Tenant or any Affiliate of such
Tenant, and assuming the exercise of all expansion rights and preferential
rights to lease additional space contained in such Lease or Leases, (a) covers
or is expected to cover more than thirty percent (30%) of the total rentable
square footage at the Property or (b) requires the payment of base rent in an
amount equal to or exceeding thirty percent (30%) of the Gross Income from
Operations, (ii) contains an option or preferential right to purchase all or any
portion of the Property, (iii) is with an Affiliate of Borrower, Guarantor or
Manager as Tenant, (iv) is entered into during the continuation of an Event of
Default or (v) is a Material Tenant Lease.

“Management Agreement” shall have the meaning set forth in Section 7.1(a).

“Manager” shall mean such Person (other than Borrower) who is managing the
Property in accordance with the terms and provisions of this Agreement.

“Manager Trigger Event” shall mean the occurrence of an indictment for fraud or
misappropriation of funds by Manager or any director or any officer of Manager.

“Material Adverse Effect” shall mean any material adverse effect upon (i) the
business operations, economic performance, assets, condition (financial or
otherwise), equity, contingent liabilities, prospects, material agreements or
results of operations of Borrower, Guarantor or the Property, (ii) the ability
of Borrower or Guarantor to perform its obligations under any Loan Document to
which it is a party, (iii) the enforceability or validity of any Loan Document,
the perfection or priority of any Lien created under any Loan Document or the
rights, interests and remedies of Lender under any Loan Document, to the extent
not caused by Lender’s actions or omissions, provided Borrower cooperates with
all reasonable requests of Lender in order to preserve any of the foregoing, or
(iv) the value, use or operation of the Property or the cash flows from the
Property.

“Material Agreements” shall mean (i) each management, brokerage or leasing
agreement (other than the Management Agreement), and (ii) any cleaning,
maintenance, service or other contract or agreement of any kind (other than the
Leases) of a material nature (materiality for purposes of this definition shall
include, without limitation, any contract with a term longer than one year or
any contract that is not cancelable on thirty (30) days’ or less notice without
the payment of any termination fee or payments of any kind), in either case
relating to the ownership, development, leasing, management, use, operation,
maintenance, repair, improvement or restoration of the Property, whether written
or oral.

 “Material Tenant” shall mean any tenant of all or a portion of the Property
under a Material Tenant Lease.
 
18

--------------------------------------------------------------------------------

“Material Tenant Lease” shall mean (i) the Ionis Lease and (ii) any Lease which,
either individually or when taken together with any other Lease with the same
Tenant or any Affiliate of such Tenant, and assuming the exercise of all
expansion rights and preferential rights to lease additional space contained in
such Lease or Leases, (a) covers (or, after giving effect to any such proposed
Lease, would cover) no less than 30% of the total rentable square footage at the
Property or (b) requires (or, after giving effect to any such proposed Lease,
would require) the payment of base rent that is no less than 30% of the total
in-place base rent at the Property, in each case under clause (i) or (ii), as
the same may be amended, restated, replaced, supplemented or otherwise modified
from time to time in accordance with the terms and conditions of this Agreement.

“Material Tenant Rollover Account” shall have the meaning set forth in Section
6.13.1 hereof.

“Material Tenant Rollover Funds” shall have the meaning set forth in Section
6.13.1 hereof.

“Material Tenant Satisfactory Extension or Re-tenanting Conditions” shall mean
(i) an Acceptable Material Tenant Lease Extension with respect to all of the
applicable Material Tenant Space or (ii) one or more Acceptable Material Tenant
Space Re-tenanting Events with respect to all of the applicable Material Tenant
Space; provided that (a) in connection with such Acceptable Material Tenant
Lease Extension, (1) the applicable Material Tenant Lease shall be in full force
and effect and no Material Tenant Trigger Event shall have occurred and then be
continuing with respect to such Material Tenant Lease or the related Material
Tenant (or, if applicable, any guarantor with respect to such Material Tenant
Lease), (2) the applicable Material Tenant shall be in actual, physical
possession of and utilizing (i.e., not “dark”) in the conduct of its normal
business operations (which utilization, for purposes of this definition, shall
include remodeling or renovation of all or a portion of such space in order for
such Material Tenant to continue its normal business operations) and paying full
unabated rent (including reimbursements, if any) under such Material Tenant
Lease as evidenced by a tenant estoppel certificate in form and substance
reasonably acceptable to Lender, (3) all tenant improvement work required to be
completed or caused to be completed by Borrower in connection with such
Acceptable Material Tenant Lease Extension shall have been completed in a good
and workmanlike manner on a lien free basis in accordance with the terms and
conditions of such Material Tenant Lease and this Agreement, and (4) all tenant
allowances, leasing commissions and costs and expenses in connection with such
Acceptable Material Tenant Lease Extension shall have been paid in full, and all
other concessions shall have been satisfied, in accordance with the terms and
conditions of such Material Tenant Lease and this Agreement and (b) in
connection with each applicable Acceptable Material Tenant Space Re-tenanting
Event, (1) the applicable replacement Lease shall be in full force and effect,
no event of default shall have occurred and be then continuing thereunder and,
if any such replacement Lease is a Material Tenant Lease, no Material Tenant
Trigger Event shall have occurred and then be continuing with respect to such
Material Tenant Lease or the related Material Tenant (or, if applicable, any
guarantor with respect to such Material Tenant Lease), (2) the Tenant under the
applicable replacement Lease shall be in actual, physical possession of and
utilizing (i.e., not “dark”) the space demised under such replacement Lease in
the conduct of its normal business operations (which utilization, for purposes
of this definition, shall include remodeling or renovation of all or a portion
of such space in order for such Tenant to commence or continue its normal
business operations) and paying full unabated rent (including reimbursements, if
any) under such replacement Lease as evidenced by a tenant estoppel certificate
in form and substance reasonably acceptable to Lender, (3) all tenant
improvement work required to be completed or caused to be completed by Borrower
in connection with the applicable replacement Lease shall have been completed in
a good and workmanlike manner on a lien free basis in accordance with the terms
and conditions of the applicable replacement Lease and this Agreement, and (4)
all tenant allowances, leasing commissions and costs and expenses in connection
with the applicable replacement Lease shall have been paid in full, and all
other concessions shall have been satisfied, in accordance with the terms and
conditions of the applicable replacement Lease and this Agreement.
 
19

--------------------------------------------------------------------------------

“Material Tenant Space” shall mean the Property or the portion of the Property,
as applicable, demised to a Tenant pursuant to a Material Tenant Lease (or
previously demised to a Tenant pursuant to a Material Tenant Lease that has
expired or terminated and, following such expiration or termination and as of
the date of determination, has not been demised to a replacement Tenant pursuant
to a Lease entered into in accordance with the terms and conditions of this
Agreement).

“Material Tenant Trigger Event” shall mean:

(i)         if a Material Tenant gives written notice to Borrower of its
intention to terminate or cancel its Material Tenant Lease or of its intention
not to extend or renew its Material Tenant Lease;
 
(ii)        if, on or prior to the date that is 12 months prior to the then
applicable expiration date under its Material Tenant Lease, a Material Tenant
does not extend or renew such Material Tenant Lease on terms and conditions
reasonably acceptable to Lender (it being understood and agreed that an
extension or renewal of a Material Tenant Lease strictly in accordance with the
terms and conditions thereof applicable to such extension or renewal (including,
for example, terms and conditions pursuant to which the rent applicable to the
extension or renewal term are determined) shall be deemed to be reasonably
acceptable to Lender);
 
(iii)       if, on or prior to the date by which a Material Tenant is required
under its Material Tenant Lease to notify Borrower of its election to extend or
renew such Material Tenant Lease, such Material Tenant does not give such
notice;
 
(iv)       if an event of default under a Material Tenant Lease occurs and
continues beyond any applicable notice and cure period;
 
(v)        if a Material Tenant (or, if applicable, any lease guarantor with
respect to a Material Tenant Lease) becomes insolvent or a debtor in a
Bankruptcy Action;
 
(vi)       if a Material Tenant Lease is terminated or is no longer in full
force and effect;
 
20

--------------------------------------------------------------------------------

(vii)     if a Material Tenant "goes dark", vacates, ceases to occupy or ceases
to conduct business in the ordinary course at the Material Tenant Space demised
under its Material Tenant Lease (other than temporary cessation of operations in
connection with remodeling, renovation or restoration of their leased premises);
or
 
(viii)        if Ionis, the tenant under the Ionis Lease, fails to maintain
Liquid Assets of at least $85,000,000.00 (it is acknowledged and agreed that, if
at any time the Ionis Reporting Condition is not satisfied, the determination of
whether Ionis maintains Liquid Assets of at least $85,000,000.00 shall be made
by Lender).

For purposes of clarification and without limitation, it is understood and
agreed that, with respect to any Material Tenant (or, if applicable, any lease
guarantor with respect to the applicable Material Tenant Lease) or the
applicable Material Tenant Lease, (a) more than one Material Tenant Trigger
Event may exist at any time, (b) more than one Material Tenant Trigger Event may
exist at any time pursuant to clause (iv) of this definition of “Material Tenant
Trigger Event”, and (c) more than one Material Tenant Trigger Event may exist at
any time pursuant to clause (v) of this definition of “Material Tenant Trigger
Event”.

“Material Tenant Trigger Event Cure” shall mean:

(i)         if the Material Tenant Trigger Event is caused solely by the
occurrence of clause (i) in the definition of “Material Tenant Trigger Event”,
(a) the unconditional revocation or rescission by the applicable Material Tenant
of all termination or cancellation notices with respect to its Material Tenant
Lease (or, if applicable, the unconditional revocation or rescission by the
applicable Material Tenant of all notices of any intention to terminate or
cancel, or to not extend or renew, its Material Tenant Lease), (b) an Acceptable
Material Tenant Lease Extension with respect to all of the applicable Material
Tenant Space; provided that each of the Material Tenant Satisfactory Extension
or Re-tenanting Conditions applicable thereto shall have been satisfied, or (c)
one or more Acceptable Material Tenant Space Re-tenanting Events with respect to
all of the applicable Material Tenant Space; provided that each of the Material
Tenant Satisfactory Extension or Re-tenanting Conditions applicable thereto
shall have been satisfied;
 
(ii)        if the Material Tenant Trigger Event is caused solely by the
occurrence of clause (ii) in the definition of “Material Tenant Trigger Event”,
(a) an Acceptable Material Tenant Lease Extension with respect to all of the
applicable Material Tenant Space; provided that each of the Material Tenant
Satisfactory Extension or Re-tenanting Conditions applicable thereto shall have
been satisfied or (b) one or more Acceptable Material Tenant Space Re-tenanting
Events with respect to all of the applicable Material Tenant Space; provided
that each of the Material Tenant Satisfactory Extension or Re-tenanting
Conditions applicable thereto shall have been satisfied;
 
21

--------------------------------------------------------------------------------

(iii)       if the Material Tenant Trigger Event is caused solely by the
occurrence of clause (iii) in the definition of “Material Tenant Trigger Event”,
(a) an Acceptable Material Tenant Lease Extension with respect to all of the
applicable Material Tenant Space; provided that each of the Material Tenant
Satisfactory Extension or Re-tenanting Conditions applicable thereto shall have
been satisfied or (b) one or more Acceptable Material Tenant Space Re-tenanting
Events with respect to all of the applicable Material Tenant Space; provided
that each of the Material Tenant Satisfactory Extension or Re-tenanting
Conditions applicable thereto shall have been satisfied;
 
(iv)       if the Material Tenant Trigger Event is caused solely by the
occurrence of clause (iv) in the definition of “Material Tenant Trigger Event,”
a cure of the applicable event of default under the applicable Material Tenant
Lease, as determined by Lender in its reasonable discretion;
 
(v)        if the Material Tenant Trigger Event is caused solely by the
occurrence of clause (v) in the definition of “Material Tenant Trigger Event,”
the affirmation of the applicable Material Tenant Lease in the applicable
bankruptcy proceeding; provided that the applicable Material Tenant shall be
actually paying all contractual rents and other amounts due under its Material
Tenant Lease (or, if applicable, the discharge or dismissal of the applicable
lease guarantor from the applicable bankruptcy proceeding;
 
(vi)       if the Material Tenant Trigger Event is caused solely by the
occurrence of clause (vi) in the definition of “Material Tenant Trigger Event,”
one or more Acceptable Material Tenant Space Re-tenanting Events with respect to
all of the applicable Material Tenant Space; provided that each of the Material
Tenant Satisfactory Extension or Re-tenanting Conditions applicable thereto
shall have been satisfied;
 
(vii)      if the Material Tenant Trigger Event is caused solely by the
occurrence of clause (vii) in the definition of “Material Tenant Trigger Event,”
Borrower has provided Lender with written evidence, reasonably acceptable to
Lender in all respects, that such (A) Material Tenant has re-opened for business
or (B) one or more Acceptable Material Tenant Space Re-tenanting Events with
respect to all of the applicable Material Tenant Space; provided that in each
case, each of the Material Tenant Satisfactory Extension or Re-tenanting
Conditions applicable thereto shall have been satisfied; and
 
(viii)     if the Material Tenant Trigger Event is caused solely by the
occurrence of clause (viii) in the definition of “Material Tenant Trigger
Event,” Borrower delivers written evidence, reasonably acceptable to Lender,
that Ionis has Liquid Assets of at least $85.000.000.00,

provided that each Material Tenant Trigger Event Cure set forth above shall be
subject to the following conditions: (1) after giving effect to such Material
Tenant Trigger Event Cure, no Material Tenant Trigger Event shall have occurred
and remain outstanding with respect to any Material Tenant, any lease guarantor
with respect to any Material Tenant Lease or any Material Tenant Lease, and (2)
Borrower shall have paid all of Lender’s reasonable costs and expenses incurred
in connection with such Material Tenant Trigger Event Cure (including, without
limitation, reasonable attorneys’ fees and expenses).

“Material Tenant Trigger Event Excess Cash Flow” shall have the meaning set
forth in Section 2.7.2 hereof.
 
22

--------------------------------------------------------------------------------

“Maturity Date” shall mean the date on which the final payment of principal of
the Note becomes due and payable as therein or herein provided, whether at the
Stated Maturity Date, by declaration of acceleration, or otherwise.

“Maximum Legal Rate” shall mean the maximum non-usurious interest rate, if any,
that at any time or from time to time may be contracted for, taken, reserved,
charged or received on the indebtedness evidenced by the Note and as provided
for herein or in the other Loan Documents, under the laws of such Governmental
Authorities whose laws are held by any court of competent jurisdiction to govern
the interest rate provisions of the Loan.

“Merged Entity” shall have the meaning set forth in Section 8.2.2 hereof.

“Merger” shall have the meaning set forth in Section 8.2.2 hereof.

“Mezzanine Borrower” shall have the meaning set forth in Section 11.30 hereof.

“Mezzanine Lender” shall have the meaning set forth in Section 11.30 hereof.

“Mezzanine Loan” shall have the meaning set forth in Section 11.30 hereof.

“Mezzanine Option” shall have the meaning set forth in Section 11.30 hereof.

“Minimum Disbursement Amount” shall mean Ten Thousand and No/100 Dollars
($10,000).

 “Monthly Capital Expenditure Deposit” shall have the meaning set forth in
Section 6.4.1 hereof.

“Monthly Debt Service Payment Amount” shall mean (i) with respect to each
Monthly Payment Date occurring on or prior to August, 2022, an amount equal to
interest which is scheduled to accrue on the Loan through the end of the
Interest Period in which such Monthly Payment Date occurs and (ii) with respect
to each Monthly Payment Date thereafter, a constant monthly payment amount of
$241,643.01.

“Monthly Insurance Deposit” shall have the meaning set forth in Section 6.3.1
hereof.

“Monthly Payment Date” shall mean the sixth (6th) day of every calendar month
occurring during the Term commencing with September 6, 2017; provided, however,
that Lender shall have the right, in connection with a Securitization, to change
the Monthly Payment Date to any other day of a calendar month selected by
Lender, in its sole and absolute discretion,  upon at least five (5) Business
Days written notice to Borrower (in which event such change shall then be deemed
effective) and, if requested by Lender, Borrower shall promptly execute an
amendment to this Agreement to evidence such change; provided that if Lender
shall have elected to change the Monthly Payment Date as aforesaid, Lender shall
adjust the Interest Period accordingly.

“Monthly Rollover Deposit” shall have the meaning set forth in Section 6.5.1
hereof.

“Monthly Tax Deposit” shall have the meaning set forth in Section 6.2.1 hereof.
 
23

--------------------------------------------------------------------------------

“Moody’s” shall mean Moody’s Investors Service, Inc.

“Mortgage Borrower” shall have the meaning set forth in Section 11.30 hereof.

“Mortgage Loan” shall have the meaning set forth in Section 11.30 hereof.

“Net Cash Flow” shall mean, for any period, the amount obtained by subtracting
Operating Expenses and Capital Expenditures for such period from Gross Income
from Operations for such period.

“Net Operating Income” shall mean, for any period, the amount obtained by
subtracting Operating Expenses for such period from Gross Income from Operations
for such period.

“Net Proceeds” shall mean:  (i) the net amount of all Insurance Proceeds, after
deduction of reasonable costs and expenses (including, but not limited to,
reasonable attorneys’ fees), if any, in collecting such Insurance Proceeds;
provided that, for purposes of Section 5.3 hereof, “Net Proceeds” shall mean
such net amount of Insurance Proceeds to the extent received by Lender pursuant
to the Policies required under Sections 5.1.1(a)(i), (iv), (vi), (xi) and (xii)
as a result of the applicable Casualty, or (ii) the net amount of the Award,
after deduction of reasonable costs and expenses (including, but not limited to,
reasonable attorneys’ fees), if any, in collecting such Award.

“Net Proceeds Deficiency” shall have the meaning set forth in Section 5.3.2(f)
hereof.

“Net Worth” shall mean, as of a given date, (i) a Person’s total assets as of
such date less (ii) such Person’s total liabilities as of such date, determined
in accordance with the Acceptable Accounting Basis.

“Note” shall mean, individually and/or collectively, as the context may require,
Note A-1, Note A-2 and Note A-3, as the same may be amended, restated, replaced,
extended, renewed, supplemented, severed, split or otherwise modified from time
to time (including any component notes created pursuant to Section 11.29 from to
time to time).

“Note A-1” shall mean that certain Promissory Note A-1, dated the date hereof,
in the stated principal amount of Thirty-Six Million Three Hundred Five Thousand
and No/100 Dollars ($36,350,000.00), made by Borrower in favor of Lender, as the
same may be amended, restated, replaced, extended, renewed, supplemented,
severed, split or otherwise modified from time to time (including any component
notes created pursuant to Section 11.29 from to time to time).

“Note A-2” shall mean that certain Promissory Note A-2, dated the date hereof,
in the stated principal amount of Five Million and No/100 Dollars
($5,000,000.00), made by Borrower in favor of Lender, as the same may be
amended, restated, replaced, extended, renewed, supplemented, severed, split or
otherwise modified from time to time (including any component notes created
pursuant to Section 11.29 from to time to time).

“Note A-3” shall mean that certain Promissory Note A-3, dated the date hereof,
in the stated principal amount of Ten Million and No/100 Dollars
($10,000,000.00), made by Borrower in favor of Lender, as the same may be
amended, restated, replaced, extended, renewed, supplemented, severed, split or
otherwise modified from time to time (including any component notes created
pursuant to Section 11.29 from to time to time).
 
24

--------------------------------------------------------------------------------

 “Notice” shall have the meaning set forth in Section 11.6 hereof.

“NRSRO” shall mean any credit rating agency that has elected to be treated as a
nationally recognized statistical rating organization for purposes of Section
15E of the Exchange Act, without regard to whether or not such credit rating
agency has been engaged by Lender or other Securitization Indemnified Parties in
connection with, or in anticipation of, a Securitization.

“Obligations” shall mean, collectively, Borrower’s obligations for the payment
of the Debt and the performance of the Other Obligations.

“OFAC” shall mean the Office of Foreign Assets Control or, if the context
requires, any successor Governmental Authority.

“Officer’s Certificate” shall mean a certificate delivered to Lender by Borrower
which is signed by an authorized senior officer of Sole Member.

“Open Prepayment Commencement Date” shall mean the Monthly Payment Date that
occurs four (4) months prior to the Stated Maturity Date.

“Operating Agreements” shall mean, collectively, the REA and any other
covenants, restrictions or agreements of record relating to the construction,
operation or use of the Property.

“Operating Expenses” shall mean, for any period, the total of all expenditures,
computed in accordance with the Acceptable Accounting Basis of whatever kind
during such period relating to the operation, maintenance and management of the
Property that are incurred on a regular monthly or other periodic basis,
including, without limitation, utilities, ordinary repairs and maintenance,
insurance, license fees, property taxes and assessments, advertising expenses,
management fees, payroll and related taxes, computer processing charges,
operational equipment or other lease payments as approved by Lender, and other
similar costs, but excluding depreciation and amortization, Debt Service,
Capital Expenditures, and contributions to the Reserve Funds.

“Organizational Documents” shall mean, as to any Person, the organizational or
governing documents of such Person, including the certificate of incorporation
and by-laws with respect to a corporation; the certificate of formation or
organization and operating agreement with respect to a limited liability
company; and the certificate of limited partnership and partnership agreement
with respect to a limited partnership.

“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.
 
25

--------------------------------------------------------------------------------

“Other Obligations” shall mean: (i) all obligations of Borrower contained in
this Agreement, the Note or any other Loan Document, and (ii) all obligations of
Borrower contained in any renewal, extension, amendment, restatement,
modification, consolidation, change of, or substitution or replacement for all
or any part of this Agreement, the Note or any other Loan Document, excluding,
in each case, Borrower’s obligation for the payment of the Debt.

“Outstanding Principal Balance” shall mean, as of any date, the outstanding
principal balance of the Loan.

“PACE Loan” shall mean any Property-Assessed Clean Energy loan or any similar
financing.

“Patriot Act” shall mean, collectively, all laws relating to terrorism or money
laundering, including Executive Order No. 13224 on Terrorist Financing
(effective September 24, 2001) and the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001 (Public Law 107‑56), as the same may be amended, replaced, supplemented or
otherwise modified from time to time.

“Patriot Act Offense” shall mean (i) any violation of the laws of the United
States of America or of any of the several states, or any act or omission that
would constitute a violation of such laws if committed within the jurisdiction
of the United States of America or any of the several states, relating to
terrorism or money laundering, including any offense under (a) the laws against
terrorism; (b) the laws against money laundering, (c) the Bank Secrecy Act, as
amended, (d) the Money Laundering Control Act of 1986, as amended, or (e) the
Patriot Act, or (ii) the conspiracy to commit, or aiding and abetting another to
commit, any violation of any such laws.

“Permitted Encumbrances” shall mean, collectively, (i) the Liens and security
interests created by the Loan Documents, (ii) all Liens, encumbrances and other
matters expressly set forth on Schedule A or Schedule B of the Title Insurance
Policy, (iii) Liens, if any, for Taxes imposed by any Governmental Authority not
yet delinquent (provided no fees, interest and/or penalties have begun to
accrue), other than Liens securing a PACE Loan and (iv) such other title and
survey exceptions as Lender has approved or may approve in writing in Lender’s
sole discretion.

“Permitted Investments” shall have the meaning set forth in the Cash Management
Agreement.

“Permitted Merger” shall have the meaning set forth in Section 8.2.2 hereof.

“Permitted Release Date” shall mean the date that is the third (3rd) anniversary
of the first (1st) Monthly Payment Date.

“Permitted Transfer” shall mean any of the following:  (i) any transfer,
directly as a result of the death of a natural person, of stock, membership
interests, partnership interests or other ownership interests previously held by
the decedent in question to the Person or Persons lawfully entitled thereto,
(ii) any transfer, directly as a result of the legal incapacity of a natural
person, of stock, membership interests, partnership interests or other ownership
interests previously held by such natural person to the Person or Persons
lawfully entitled thereto, (iii) any Lease of space in the Improvements to
Tenants in accordance with the terms and provisions of Section 4.1.9 hereof and
(iv) any Transfer permitted without Lender’s prior consent in accordance with
the terms and provisions of Section 8.2 hereof.
 
26

--------------------------------------------------------------------------------

“Person” shall mean any individual, corporation, partnership, limited liability
company, joint venture, estate, trust, unincorporated association, any other
entity, any Governmental Authority 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 Security Instrument.

“Policies” or “Policy” shall have the meaning set forth in Section 5.1.1(b)
hereof.

“Prepayment Date” shall mean the date on which the Loan is prepaid in accordance
with the terms hereof.

“Prohibited Entity” shall mean (a) a statutory trust organized under 12 Del.C. §
3801 et seq., or any successor statute thereto, or under any similar other state
or federal law, (b) any one or more Persons as tenants in common or any similar
ownership structure, or (c) any one or more Persons as a result of any
Crowdfunding.

“Prohibited Person” shall mean any Person:

(i)          listed in the Annex to, or is otherwise subject to the prohibitions
of, Executive Order No. 13224 on Terrorist Financing, effective September 24,
2001, and relating to Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten to Commit, or Support Terrorism or any other
similar prohibitions contained in the rules and regulations of OFAC or in any
enabling legislation or other Executive Orders;
 
(ii)        that is owned or Controlled by, or acting for or on behalf of, any
Person that is listed in the Annex to, or is otherwise subject to the
prohibitions of, Executive Order No. 13224;
 
(iii)       with whom Lender is prohibited from dealing or otherwise engaging in
any transaction by any terrorism or money laundering law, including Executive
Order No. 13224;
 
(iv)       who commits, threatens, conspires to commit or supports “terrorism”
as defined in Executive Order No. 13224;
 
(v)        that is named as a “specially designated national and blocked person”
on the most current list published by OFAC at its official website or at any
replacement website or other replacement official publication of such list;
 
(vi)       that is subject to trade restrictions under United States law,
including, without limitation, the Patriot Act, the International Emergency
Economic Powers Act, 50 U.S.C. §§ 1701 et seq., The Trading with the Enemy Act,
50 U.S.C. App. 1 et seq., and any Executive Orders or regulations promulgated
thereunder;
 
27

--------------------------------------------------------------------------------

(vii)      that is listed on any Government List;
 
(viii)     that has been previously indicted for or convicted of any felony
involving a crime or crimes of moral turpitude or for any Patriot Act Offense;
 
(ix)       that is currently under investigation by any Governmental Authority
for alleged criminal activity; or
 
(x)        who is an Affiliate of any Person that is described by or that
satisfies any of clauses (i) through (ix) above.

“Property” shall mean the parcel of real property, the Improvements now or
hereafter erected, situated or installed thereon and all personal property owned
by Borrower and encumbered by the Security Instrument, together with all rights
pertaining to such property (real and personal) and the Improvements, all as
more particularly described in the granting clauses of the Security Instrument.

“Purchase and Sale Agreement” shall have the meaning set forth in Section 3.1.52
hereof.

“Qualified Manager” shall mean a reputable and experienced manager (which, prior
to the occurrence of a Manager Trigger Event, may be an Affiliate of Borrower)
which, in the reasonable judgment of Lender, possesses experience in managing
properties similar in location, size, class, use, operation and value as the
Property; provided, that Borrower shall have obtained (a) if required by Lender,
a Rating Agency Confirmation from the Rating Agencies if required by Lender to
comply with the terms of the Serving Agreement, a Rating Agency Confirmation
from the Rating Agencies and (b) if such Person is an Affiliate of Borrower, a
new bankruptcy non-consolidation opinion reasonably acceptable to Lender and
acceptable to the Rating Agencies in their sole discretion.

“Ratable Share” shall mean, with respect to any Co-Lender, its share of the Loan
based on the proportion of the Outstanding Principal Balance advanced by such
Co-Lender to the total Outstanding Principal Balance.

“Rating Agencies” shall mean, prior to the final Securitization of the Loan,
each of S&P, Moody’s, Fitch, Realpoint LLC and DBRS, Inc. or any other
nationally-recognized statistical rating agency which has been designated by
Lender and, after the final Securitization of the Loan, shall mean any of the
foregoing that has rated any of the Securities.

“Rating Agency Confirmation” shall mean, collectively, a written affirmation
from each of the Rating Agencies that the rating of the Securities (or any class
thereof) by such Rating Agency immediately prior to the occurrence of the event
with respect to which such Rating Agency Confirmation is sought will not be
qualified, downgraded or withdrawn as a result of the occurrence of such event,
which affirmation may be granted or withheld in such Rating Agency’s sole and
absolute discretion.  In the event that, at any given time, no Rating Agency has
elected to consider whether to grant or withhold such an affirmation, then the
term “Rating Agency Confirmation” shall be deemed instead to require the written
approval of Lender based on its good faith determination of whether the Rating
Agencies would issue a Rating Agency Confirmation; provided that the foregoing
shall be inapplicable in any case in which Lender has an independent approval
right in respect of the matter at issue pursuant to the terms of this Agreement.
 
28

--------------------------------------------------------------------------------

“REA” shall collectively mean those certain agreements more specifically
described on Schedule 1.1A hereto, as the same may be amended, supplemented or
otherwise modified from time to time in accordance with the terms and provisions
of this Agreement.

“Regulation AB” shall mean Regulation AB under the Securities Act and the
Exchange Act, as such regulation may be amended from time to time.

“Regulation S-K” means Regulation S-K of the Securities Act, as such regulation
may be amended from time to time.

“Regulation S-X” means Regulation S-X of the Securities Act, as such regulation
may be amended from time to time.

“Related Loan” shall mean (i) a loan made to an Affiliate of Borrower or
Guarantor or secured by a Related Property that is included in a Securitization
with the Loan or any portion thereof or interest therein or (ii) any loan that
is cross-collateralized or cross-defaulted with the Loan.

“Related Property” shall mean a parcel of real property, together with
improvements thereon and personal property related thereto, that is “related”
within the meaning of the definition of “Significant Obligor” to the Property.

“REMIC Trust” shall mean a “real estate mortgage investment conduit” within the
meaning of Section 860D of the Code that holds the Note or any interest therein.

“Rents” shall mean all rents (including, without limitation, percentage rents),
rent equivalents, moneys payable as damages (including payments by reason of the
rejection of a Lease in a Bankruptcy Action) or in lieu of rent or rent
equivalents, Extraordinary Lease Payments, royalties (including, without
limitation, all oil and gas or other mineral royalties and bonuses), income,
fees, receivables, receipts, revenues, deposits (including, without limitation,
security, utility and other deposits), accounts, cash, issues, profits, charges
for services rendered, and other payment and consideration of whatever form or
nature received by or paid to or for the account of or the benefit of Borrower,
Manager (if any) or any of their respective agents or employees from any and all
sources arising from or attributable to the Property, including all receivables,
customer obligations, installment payment obligations and other obligations now
existing or hereafter arising or created out of the sale, lease, sublease,
license, concession or other grant of the right of the use and occupancy of the
Property or rendering of services by Borrower, Manager or any of their
respective agents or employees, and the Insurance Proceeds, if any, from
business or rental interruption or other loss of income insurance.
 
29

--------------------------------------------------------------------------------

“Replacement Management Agreement” shall mean, collectively, (i) a management
agreement with a Qualified Manager, which management agreement shall be in form
and substance reasonably acceptable to Lender; provided, that Borrower shall
have obtained a Rating Agency Confirmation from the Rating Agencies, and (ii) an
assignment of management agreement and subordination of management fees
substantially in the form then used by Lender (or in such other form and
substance reasonably acceptable to Lender), executed and delivered to Lender by
Borrower and such Qualified Manager.

 “Reserve Funds” shall mean, collectively, the Tax Funds, the Insurance Funds,
the Capital Expenditure Funds, the Rollover Funds, the Excess Cash Flow Funds,
the Material Tenant Rollover Funds and any other escrow or reserve fund
established by the Loan Documents.

“Restoration” shall mean the repair and restoration of the Property after a
Casualty or Condemnation as nearly 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.

“Restoration Threshold” shall mean five percent (5%) of the Outstanding
Principal Balance.

“Restricted Party” shall mean, collectively, (i) Borrower, Sole Member and
Guarantor, and (ii) any shareholder, partner, member, non-member manager or any
other direct or indirect legal or beneficial owner of Borrower, Sole Member and
Guarantor, or any non-member manager.

“Rollover Account” shall have the meaning set forth in Section 6.5.1 hereof.

“Rollover Funds” shall have the meaning set forth in Section 6.5.1 hereof.

“Rollover Reserve Waiver Conditions Precedent” shall collectively mean the
following conditions precedent: (i) no Event of Default has occurred and is
continuing, (ii) all of the Property shall be demised pursuant to the Ionis
Lease, (iii) the Ionis Lease is in full force and effect and (iv) no Material
Tenant Trigger Event shall have occurred and be continuing.

“S&P” shall mean Standard & Poor’s Ratings Services.

“Scheduled Defeasance Payments” shall have the meaning set forth in the
definition of the term “Defeasance Collateral”.

“Secondary Market Transaction” shall have the meaning set forth in Section
9.1(a) hereof.

“Securities” shall have the meaning set forth in Section 9.1(a) hereof.

“Securities Act” shall have the meaning set forth in Section 9.2(a) hereof.
 
“Securitization” shall have the meaning set forth in Section 9.1(a) hereof.
 
30

--------------------------------------------------------------------------------

“Securitization Indemnification Liabilities” shall have the meaning set forth in
Section 9.2(b) hereof.

“Securitization Indemnified Parties” shall have the meaning set forth in Section
9.2(b) hereof.

“Securitization Vehicle” means each REMIC Trust or Grantor Trust into which all
or a portion of the Loan or an interest therein has been transferred.

“Security Instrument” shall mean that certain first priority Deed of Trust,
Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as
of 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.

“Servicer” shall have the meaning set forth in Section 11.24(a) hereof.

“Servicing Agreement” shall have the meaning set forth in Section 11.24(a)
hereof.

“Settlement Statement” shall have the meaning set forth in Section 3.1.52
hereof.

 “Severed Loan Documents” shall have the meaning set forth in Section 10.2(c)
hereof.

“Significant Obligor” shall have the meaning set forth in Item 1101(k) of
Regulation AB under the Securities Act.

“Sole Member” shall have the meaning set forth in Section 3.1.24(q) hereof.

“Special Member” shall have the meaning set forth in Section 3.1.24(q) hereof.

“Sponsor” shall mean Ionis.

 “Springing Recourse Event” shall have the meaning set forth in Section 11.22
hereof.

“State” shall mean the State or Commonwealth in which the Property or any part
thereof is located.

“Stated Maturity Date” shall mean August 6, 2027; provided, however, that, in
the event Lender changes the Monthly Payment Date in accordance with this
Agreement, the Stated Maturity Date shall also be deemed to have been changed
such that the Stated Maturity Date and the Monthly Payment Date shall occur on
the same calendar day and, if requested by Lender, Borrower shall promptly
execute an amendment to this Agreement to evidence such change.

“Successor Borrower” shall have the meaning set forth in Section 2.5.3 hereof.

“Survey” shall mean a current land survey for the Property, certified to the
title insurance company and Lender and its successors and assigns, in form and
substance satisfactory to Lender and prepared by a professional and properly
licensed land surveyor satisfactory to Lender in accordance with the most
current Minimum Standard Detail Requirements for ALTA/ACSM Land Title Surveys
together with the surveyor’s seal affixed to the Survey and a certification from
the surveyor in form and substance acceptable to Lender.
 
31

--------------------------------------------------------------------------------

“Tax Account” shall have the meaning set forth in Section 6.2.1 hereof.

“Tax Funds” shall have the meaning set forth in Section 6.2.1 hereof.

 “Tax Reserve Waiver Conditions Precedent” shall mean the following conditions
precedent: (i) no Event of Default has occurred and is continuing, (ii) all of
the Property shall be demised pursuant to the Ionis Lease, (iii) the Ionis Lease
is in full force and effect, (iv) no Material Tenant Trigger Event shall have
occurred and be continuing, (v) Ionis is obligated pursuant to the terms and
conditions of the Ionis Lease to pay all Taxes directly to the applicable
Governmental Authorities in full in a timely manner, and (vi) Ionis performs its
obligation under clause (v) in a timely manner and Borrower provides evidence,
in form and substance reasonably satisfactory to Lender, of such performance by
Ionis to Lender in a timely manner.

“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 any part thereof, together with all interest and
penalties thereon.

“Tenant” shall mean any Person obligated by contract or otherwise to pay monies
(including a percentage of gross income, revenue or profits) under any Lease now
or hereafter affecting all or any part of the Property.

“Term” shall mean the term of the Loan.

“Title Insurance Policy” shall mean an ALTA mortgagee title insurance policy in
the form acceptable to Lender (or, if the Property is in a State which does not
permit the issuance of such ALTA policy, such form as shall be permitted in such
State and acceptable to Lender) issued with respect to the Property and insuring
the Lien of the Security Instrument, together with such endorsements and
affirmative coverages as Lender may require.

“Transfer” shall have the meaning set forth in Section 8.1(a) hereof.

“Transferee” shall have the meaning set forth in Section 8.1(f)(iii) hereof.

“Transferee’s SPE Constituent Entity” shall mean, with respect to any
Transferee, the entity that qualifies as a single purpose, bankruptcy remote
entity under criteria established by the Rating Agencies that is (i) the general
partner of such Transferee, if such Transferee is a limited partnership, or (ii)
the managing member of such Transferee, if such Transferee is a multi-member
limited liability company.

“Transferee’s Sponsors” shall mean, with respect to any Transferee, such
Transferee’s shareholders, general partners or managing members that, directly
or indirectly, (i) own fifty-one percent (51%) or more of legal, beneficial and
economic interests in such Transferee, or (ii) are in Control of such
Transferee.
 
32

--------------------------------------------------------------------------------

“Treasury Note Rate” shall mean, at the time of the prepayment, as applicable,
the rate of interest per annum equal to the yield to maturity (converted by
Lender to the equivalent monthly yield using Lender’s then system of conversion)
of the United States Treasury obligations selected by the holder of the Note
having maturity dates closest to, but not exceeding, the remaining term to the
Open Prepayment Commencement Date.

“Trustee” shall mean any trustee of a Securitization Vehicle.

“UBS AG” shall mean UBS AG, by and through its branch office at 1285 Avenue of
the Americas, New York, New York, and its successors in interest.

“UCC” or “Uniform Commercial Code” shall mean the Uniform Commercial Code as in
effect in the State of New York.

“Updated Information” shall have the meaning set forth in Section 9.1(b)(i)
hereof.

“U.S. Bankruptcy Code” shall mean Title 11 of the United States Code entitled
“Bankruptcy”, as amended from time to time, and any successor statute or
statutes and all rules and regulations from time to time promulgated thereunder.

“U.S. Obligations” shall mean (i) direct full faith and credit obligations of
the United States of America that are not subject to prepayment, call or early
redemption or (ii) to the extent acceptable to the Rating Agencies, other
“government securities” within the meaning of Treasury Regulations Section
1.860G-2(a)(8)(ii) that are not subject to prepayment, call or early redemption.

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution
Authority, the write-down and conversion powers of such EEA Resolution Authority
from time to time under the Bail-In Legislation for the applicable EEA Member
Country, which write-down and conversion powers are described in the EU Bail-In
Legislation Schedule.

“Yield Maintenance Default Premium” shall mean an amount equal to the greater
of:  (i) five percent (5%) of the principal amount of the Loan being prepaid and
(ii) the excess, if any, of (a) the present value (determined using a discount
rate equal to the Treasury Note Rate at such time) of all scheduled payments of
principal and interest payable in respect of the principal amount of the Loan
being prepaid, provided that the Note shall be deemed, for purposes of this
definition, to be due and payable on the Open Prepayment Commencement Date, over
(b) the principal amount of the Loan being prepaid.

“Yield Maintenance Premium” shall mean an amount equal to the greater of:  (i)
one percent (1%) of the principal amount of the Loan being prepaid and (ii) the
excess, if any, of (a) the present value (determined using a discount rate equal
to the Treasury Note Rate at such time) of all scheduled payments of principal
and interest payable in respect of the principal amount of the Loan being
prepaid, provided that the Note shall be deemed, for purposes of this
definition, to be due and payable on the Open Prepayment Commencement Date, over
(b) the principal amount of the Loan being prepaid.

Section 1.2.          Principles of Construction.
 
33

--------------------------------------------------------------------------------

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.

II.         THE LOAN

Section 2.1.           The Loan.

2.1.1        Agreement to Lend and Borrow.  Subject to and upon the terms and
conditions set forth herein, Lender shall make the Loan to Borrower and Borrower
shall accept the Loan from Lender on the Closing Date.

2.1.2        Single Disbursement to Borrower.  Borrower shall receive only one
(1) borrowing hereunder in respect of the Loan and any amount borrowed and
repaid hereunder in respect of the Loan may not be reborrowed.

2.1.3        The Note.  The Loan shall be evidenced by the Note and shall be
repaid in accordance with the terms of this Agreement and the Note.

2.1.4        Use of Proceeds.  Borrower shall use the proceeds of the Loan to
(a) acquire the Property and/or repay and discharge any existing loans relating
to the Property, (b) pay all past-due Basic Carrying Costs, if any, in respect
of the Property, (c) deposit the Reserve Funds, (d) pay costs and expenses
incurred in connection with the closing of the Loan, as approved by Lender, (e)
fund any working capital requirements of the Property, as approved by Lender,
and (f) distribute the balance of the proceeds, if any, to Borrower for further
application pursuant to the terms and provisions of the Organizational Documents
of Borrower.

Section 2.2.           Interest Rate.

2.2.1       Interest Rate.  Interest on the Outstanding Principal Balance shall
accrue and be payable from the Closing Date up to and including the end of the
last Interest Period in which the Maturity Date occurs at the Interest Rate.

2.2.2       Default Rate.  In the event that, and for so long as, any Event of
Default has occurred and remains outstanding, the Outstanding Principal Balance
and, to the extent permitted by law, overdue interest in respect of the Loan,
shall accrue interest at the Default Rate, calculated from the date such payment
was due without regard to any grace or cure periods contained herein.

2.2.3        Interest Calculation.  Interest on the Outstanding Principal
Balance shall be calculated by multiplying (a) the actual number of days in the
period for which the calculation is being made by (b) a daily rate based on a
three hundred sixty (360) day year (that is, the Interest Rate or the Default
Rate, as then applicable, expressed as an annual rate divided by 360) by (c) the
Outstanding Principal Balance.
 
34

--------------------------------------------------------------------------------

2.2.4       Usury Savings.  This Agreement and the other Loan Documents are
subject to the express condition that at no time shall Borrower be required or
obligated to pay interest on the principal balance of the Loan at a rate which
could subject Lender to either civil or criminal liability as a result of being
in excess of the Maximum Legal Rate.  If, by the terms of this Agreement or the
other Loan Documents, Borrower is at any time required or obligated to pay
interest on the principal balance due hereunder at a rate in excess of the
Maximum Legal Rate, the Interest Rate or the Default Rate, as the case may be,
shall be deemed to be immediately reduced to the Maximum Legal Rate and all
previous payments in excess of the Maximum Legal Rate shall be deemed to have
been payments in reduction of principal and not on account of the interest due
hereunder.  All sums paid or agreed to be paid to Lender for the use,
forbearance, or detention of the sums due under the Loan shall, to the extent
permitted by the applicable Legal Requirements, be amortized, prorated,
allocated, and spread throughout the full stated term of the Loan until payment
in full so that the rate or amount of interest on account of the Loan does not
exceed the Maximum Legal Rate from time to time in effect and applicable to the
Loan for so long as the Loan is outstanding.

Section 2.3.          Loan Payments.

2.3.1       Payment Before Maturity Date.  Borrower shall make a payment to
Lender of interest only on the Closing Date for the initial Interest Period. 
Borrower shall make a payment to Lender equal to the Monthly Debt Service
Payment Amount on the Monthly Payment Date occurring in September, 2017 and on
each Monthly Payment Date thereafter to and including the Maturity Date.

2.3.2       Intentionally Omitted.

2.3.3       Payment on Maturity Date.  Borrower shall pay to Lender on the
Maturity Date the Outstanding Principal Balance, all interest which has accrued
or would accrue through and including the last day of the Interest Period in
which the Maturity Date occurs and all other amounts due hereunder and under the
Note and the other Loan Documents.

2.3.4       Late Payment Charge.  If any principal, interest or any other sum
due under the Loan Documents (including the Outstanding Principal Balance due
and payable on the Maturity Date) is not paid by Borrower on the date on which
it is due, Borrower shall pay to Lender upon demand an amount equal to the
lesser of (a) five percent (5%) of such unpaid sum or (b) the maximum amount
permitted by applicable law in order to defray the expense incurred by Lender in
handling and processing such delinquent payment and to compensate Lender for the
loss of the use of such delinquent payment.  Any such amount shall be secured by
the Security Instrument and the other Loan Documents to the extent permitted by
applicable law.

2.3.5           Method and Place of Payment.

(a)            Except as otherwise specifically provided herein, all payments
and prepayments under this Agreement, the Note and the other Loan Documents
shall be made to Lender not later than 2:00 P.M., New York City time, on the
date when due and shall be made in lawful money of the United States of America
in immediately available funds at Lender’s office or as otherwise directed by
Lender, and any funds received by Lender after such time shall, for all purposes
hereof, be deemed to have been paid on the next succeeding Business Day.
 
35

--------------------------------------------------------------------------------

(b)             Whenever any payment to be made hereunder or under any other
Loan Document shall be stated to be due on a day which is not a Business Day,
the due date thereof shall be the first (1st) Business Day that is immediately
preceding such due date (notwithstanding such adjustment of due dates, Borrower
shall not be entitled to any deduction of interest due under this Agreement, the
Note or any of the other Loan Documents).
 
(c)              All payments required to be made by Borrower hereunder or under
the Note or the other Loan Documents shall be made irrespective of, and without
deduction for, any setoff, claim or counterclaim and shall be made irrespective
of any defense thereto.

Section 2.4.           Prepayments.

2.4.1       Voluntary Prepayments.  Except as otherwise provided herein,
Borrower shall not have the right to prepay the Loan in whole or in part. 
Subject to Sections 2.4.3 and 2.4.4 hereof, on and after the Open Prepayment
Commencement Date, Borrower may, at its option and upon thirty (30) days’ prior
notice to Lender (which notice shall specify the proposed Prepayment Date),
prepay the Debt in whole (but not in part), on any date.  Notwithstanding the
foregoing, Borrower may withdraw its notice of prepayment tendered pursuant to
this Section 2.4.1 no later than two (2) Business Days prior to the proposed
Prepayment Date set forth in such notice to Lender; provided, however, that
Borrower shall pay all reasonable out-of-pocket costs, fees and expenses
(including, but not limited to, reasonable attorneys’ fees and disbursements)
incurred by Lender in connection with actions taken as a result of its receipt
of the notice of prepayment and the revocation thereof.  Any prepayment received
by Lender shall be accompanied by (a) all interest which would have accrued on
the amount of the Loan to be prepaid through and including the last day of the
Interest Period related to the Monthly Payment Date next occurring following the
date of such prepayment (or, if such prepayment occurs on a Monthly Payment
Date, through and including the last day of the Interest Period related to such
Monthly Payment Date), (b) all out-of-pocket, third party costs and expenses
actually incurred by Lender in connection with such prepayment and (c) all other
sums due and payable under this Agreement, the Note, and the other Loan
Documents.  Subject to Borrower’s right to withdraw a notice of prepayment in
accordance with this Section 2.4.1, if a notice of prepayment is given by
Borrower to Lender pursuant to this Section 2.4.1, the amount designated for
prepayment and all other sums required under this Section 2.4 shall be due and
payable on the proposed Prepayment Date.

2.4.2       Mandatory Prepayments.  On each date on which Lender actually
receives any Net Proceeds, and if Lender is not obligated to and elects not to
make such Net Proceeds available to Borrower for a Restoration in accordance
with this Agreement, Borrower shall, at Lender’s option, prepay all or a portion
of the Debt in an amount equal to one hundred percent (100%) of such Net
Proceeds; provided that, if an Event of Default has occurred and remains
outstanding, Lender may apply such Net Proceeds to the payment of the Debt in
any order, proportion and priority as Lender may determine in its sole and
absolute discretion.  Any prepayment received by Lender in accordance with this
Section 2.4.2 shall be (a) accompanied by (i) all interest which would have
accrued on the amount of the Loan to be prepaid through and including the last
day of the Interest Period related to the Monthly Payment Date next occurring
following the date of such prepayment (or, if such prepayment occurs on a
Monthly Payment Date, through and including the last day of the Interest Period
related to such Monthly Payment Date), (ii) all reasonable out-of-pocket, third
party costs and expenses actually incurred by Lender in connection with such
prepayment and (iii) all other sums due and payable under this Agreement, the
Note, and the other Loan Documents and (b) subject to Sections 2.4.3 and 2.4.4
hereof.
 
36

--------------------------------------------------------------------------------

2.4.3       Prepayments After Default.  If, during the continuation of any Event
of Default, prepayment of all or any part of the Debt is tendered by Borrower
(which tender Lender may reject to the extent permitted by the applicable Legal
Requirements), a purchaser at foreclosure or any other Person, Borrower, such
purchaser at foreclosure or other Person shall pay, in addition to the amount of
the Loan to be prepaid, (a) an amount equal to the Yield Maintenance Default
Premium, (b) all interest which would have accrued on the amount of the Loan to
be prepaid through and including the last day of the Interest Period related to
the Monthly Payment Date next occurring following the date of such prepayment
(or, if such prepayment occurs on a Monthly Payment Date, through and including
the last day of the Interest Period related to such Monthly Payment Date), (c)
all reasonable out-of-pocket, third party costs and expenses actually incurred
by Lender in connection with such prepayment and (d) all other sums due and
payable under the Loan Documents.

2.4.4       Prepayment Prior to Defeasance Lockout Expiration Date.  If the
Permitted Release Date has occurred but the Defeasance Lockout Expiration Date
has not occurred, the Debt may be prepaid in whole (but not in part) upon not
less than thirty (30) days’ prior notice to Lender specifying the Monthly
Payment Date on which prepayment is to be made; provided that (a) no Event of
Default has occurred and remains outstanding and (b) such prepayment shall be
accompanied by (i) the Yield Maintenance Premium, (ii) all interest which would
have accrued on the amount of the Loan to be prepaid through and including the
last day of the Interest Period related to the Monthly Payment Date next
occurring following the date of such prepayment (or, if such prepayment occurs
on a Monthly Payment Date, through and including the last day of the Interest
Period related to such Monthly Payment Date), (iii) all reasonable
out-of-pocket, third party costs and expenses actually incurred by Lender in
connection with such prepayment and (iv) all other sums due and payable under
the Loan Documents.  Lender shall notify Borrower of the amount and the basis of
determination of the required prepayment consideration.  Notwithstanding the
foregoing, Borrower may withdraw its notice of prepayment tendered pursuant to
this Section 2.4.4 no later than two (2) Business Days prior to the proposed
Prepayment Date set forth in such notice to Lender; provided, however, that
Borrower shall pay all reasonable out-of-pocket costs, fees and expenses
(including, but not limited to, reasonable attorneys’ fees and disbursements)
incurred by Lender in connection with actions taken as a result of its receipt
of the notice of prepayment and the revocation thereof.  Subject to Borrower’s
right to withdraw a notice of prepayment in accordance with this Section 2.4.4,
if a notice of prepayment is given by Borrower to Lender pursuant to this
Section 2.4.4, the Debt shall be due and payable on the proposed Prepayment
Date.  Lender shall not be obligated to accept any prepayment of the Debt unless
it is accompanied by the prepayment consideration due in connection therewith.

Section 2.5.           Defeasance.
 
37

--------------------------------------------------------------------------------

2.5.1       Conditions to Defeasance.  So long as no Event of Default has
occurred and remains outstanding, following the Permitted Release Date, Borrower
shall have the right at any time after the Defeasance Lockout Expiration Date
and prior to the Open Prepayment Commencement Date, to voluntarily defease the
entire Loan and obtain a release of the Lien of the Security Instrument (a
“Defeasance Event”), subject to the satisfaction of the following conditions
precedent:

(a)           Borrower shall provide Lender not less than thirty (30) days’
prior notice (or such shorter period of time if permitted by Lender in its sole
discretion) specifying the Business Day (the “Defeasance Date”) on which the
Defeasance Event is to occur.  Notwithstanding the foregoing, Borrower may
withdraw its notice of defeasance tendered pursuant to this Section 2.5.1(a) no
later than two (2) Business Days prior to the proposed Defeasance Date set forth
in such notice to Lender; provided, however, that Borrower shall pay all
out-of-pocket costs, fees and expenses (including, but not limited to,
reasonable attorneys’ fees and disbursements) incurred by Lender in connection
with actions taken as a result of its receipt of the notice of defeasance and
the revocation thereof;
 
(b)           Borrower shall pay to Lender (i) if the Defeasance Date is a
Monthly Payment Date, the Monthly Debt Service Payment Amount due on the
Defeasance Date and (ii) all other sums due and payable under this Agreement,
the Note and the other Loan Documents;
 
(c)            Borrower shall deposit the applicable Defeasance Collateral into
the Defeasance Collateral Account and otherwise comply with the provisions of
Sections 2.5.2 and 2.5.3 hereof;
 
(d)           Intentionally Omitted;
 
(e)            Borrower shall execute and deliver to Lender a Defeasance
Security Agreement in respect of the Defeasance Collateral Account and the
Defeasance Collateral;
 
(f)            Borrower shall deliver to Lender an opinion of counsel for
Borrower that is standard in commercial lending transactions and subject only to
customary qualifications, assumptions and exceptions opining, among other
things, that (i) Borrower has legally and validly transferred and assigned the
Defeasance Collateral and all rights and obligations under the Note to Successor
Borrower, (ii) Lender has a legal and valid perfected first priority security
interest in the Defeasance Collateral Account and the Defeasance Collateral,
(iii) if a Securitization has occurred, the Securitization Vehicle formed in
connection with such Securitization will not fail to maintain its status as a
Securitization Vehicle as a result of the Defeasance Event, (iv) the Defeasance
Event will not result in a deemed exchange for purposes of the Code and will not
adversely affect the status of the Note as indebtedness for federal income tax
purposes, and (v) the delivery of the Defeasance Collateral and the grant of a
security interest in the Defeasance Collateral Account and the Defeasance
Collateral to Lender shall not constitute an avoidable preference under Section
547 of the U.S. Bankruptcy Code or any other Bankruptcy Law;
 
38

--------------------------------------------------------------------------------

(g)           If required by the Rating Agencies, Borrower shall deliver to
Lender a bankruptcy non-consolidation opinion with respect to Successor Borrower
reasonably acceptable to Lender and acceptable to the Rating Agencies in their
sole discretion;
 
(h)           Borrower shall deliver to Lender a Rating Agency Confirmation as
to the Defeasance Event;
 
(i)            Borrower shall deliver a certificate of a “big four” or other
nationally recognized public accounting firm reasonably acceptable to Lender
certifying that the Defeasance Collateral will generate amounts equal to or
greater than the applicable Scheduled Defeasance Payment on or prior to each
corresponding Monthly Payment Date or other scheduled payment date;
 
(j)             Borrower shall deliver such other certificates, opinions,
documents and instruments as Lender may reasonably request;
 
(k)            Borrower shall deliver an Officer’s Certificate certifying that
the requirements set forth in this Section 2.5 have been satisfied; and
 
(l)             Borrower shall pay all fees, costs and expenses incurred by
Lender in connection with the Defeasance Event or otherwise required to
accomplish the agreements set forth in this Section 2.5, including (i)
reasonable attorneys’ fees and expenses, (ii) the fees, costs and expenses of
the Rating Agencies, (iii) any revenue, documentary stamp or intangible taxes or
any other tax or charge due in connection with the transfer of the Note, and
(iv) the fees, costs and expenses of Servicer and any Trustee.  Simultaneously
with the notice described in Section 2.5.1(a) above, Borrower shall deliver to
Lender an amount reasonably determined by Lender to be sufficient to pay such
fees, costs and expenses, which amount may be used by Lender to pay such fees,
costs and expenses if a proposed Defeasance Event does not occur.

2.5.2       Defeasance Collateral Account.  On or before the date on which
Borrower delivers the Defeasance Collateral, Borrower shall open at an Eligible
Institution the defeasance collateral account (the “Defeasance Collateral
Account”) which shall at all times be an Eligible Account.  Each of the U.S.
Obligations that constitutes a part of the Defeasance Collateral shall be duly
endorsed by the holder thereof as directed by Lender or accompanied by a written
instrument of transfer in form and substance that would be reasonably
satisfactory to a prudent lender (including, without limitation, such
instruments as may be required by the Eligible Institution at which the
Defeasance Collateral Account is to be maintained to effectuate book‑entry
transfers and pledges through the book‑entry facilities of such Eligible
Institution) in order to perfect, upon the delivery of the Defeasance
Collateral, a first priority security interest therein in favor of Lender in
conformity with all applicable Legal Requirements governing the granting of such
security interest.  The Defeasance Collateral Account shall contain only (a) the
Defeasance Collateral and (b) cash from principal and interest paid on the
Defeasance Collateral or other cash proceeds thereof.  Pursuant to the
Defeasance Security Agreement or other appropriate agreement or instrument,
Borrower or Successor Borrower, as applicable, shall authorize and direct that
all payments received from and all proceeds of the Defeasance Collateral be made
or paid directly to the Cash Management Account (unless otherwise directed by
Lender) and applied to satisfy the Debt Service and, if applicable, other
payment obligations of Borrower under the Note or the Defeased Note, as
applicable.  Borrower or Successor Borrower, as applicable, shall be the owner
of the Defeasance Collateral Account and shall report all income accrued on the
Defeasance Collateral for federal, state and local income tax purposes in its
income tax return.  Borrower or Successor Borrower, as applicable, shall prepay
all fees, costs and expenses associated with opening and maintaining the
Defeasance Collateral Account.  Lender shall not in any way be liable by reason
of any insufficiency in the Defeasance Collateral Account.
 
39

--------------------------------------------------------------------------------

2.5.3       Successor Borrower.  In connection with a Defeasance Event, Borrower
shall establish a successor entity designated by Lender or, at Lender’s option,
a successor entity designated by Borrower (in each case, a “Successor Borrower”)
which (a) shall be a single purpose, bankruptcy remote entity under criteria
established by the Rating Agencies and (b) shall be approved by the Rating
Agencies.  Any Successor Borrower may, at Borrower’s option, be an Affiliate of
Borrower unless the Rating Agencies shall require otherwise.  Borrower shall
transfer and assign all rights and obligations under and to the Note, and the
Defeasance Security Agreement, together with the Defeasance Collateral, to such
Successor Borrower.  Such Successor Borrower shall assume the obligations under
the Note and the Defeasance Security Agreement and Borrower shall be relieved of
its obligations under such documents.  Borrower shall pay a minimum of One
Thousand and No/100 Dollars ($1,000) to any Successor Borrower as consideration
for assuming the obligations under the Note and the Defeasance Security
Agreement.  Borrower shall pay (i) all reasonable fees, costs and expenses
incurred by Lender in connection therewith and (ii) all fees, costs and expenses
incurred by the Rating Agencies in connection therewith.

Section 2.6.           Release of Property.

2.6.1       Release of Property.  Except as set forth in Section 2.5 and this
Section 2.6, no repayment, prepayment or defeasance of all or any portion of the
Loan shall cause, give rise to a right to require, or otherwise result in, the
release of the Lien of the Security Instrument on the Property.

(a)            If Borrower has elected to defease the entire Loan and the
requirements of Section 2.5 and this Section 2.6 have been fully satisfied, the
Property shall be released from the Lien of the Security Instrument and the
Defeasance Collateral Account and the Defeasance Collateral, pledged pursuant to
the Defeasance Security Agreement, shall be the sole source of collateral
securing the Note.
 
(b)            In connection with the release of the Security Instrument,
Borrower shall submit to Lender, concurrently with the notice under Section
2.5.1(a), a release of Lien (and the related Loan Documents) for the Property
for execution by Lender.  Such release shall be in a form appropriate in the
jurisdiction in which the Property is located and that would be satisfactory to
a prudent lender and contains standard provisions, if any, protecting the rights
of the releasing lender.  In addition, Borrower shall provide all other
certificates, documents and instruments Lender reasonably requires to be
delivered by Borrower in connection with such release, together with an
Officer’s Certificate certifying that such documentation (i) is in compliance
with all applicable Legal Requirements, and (ii) will effect such release in
accordance with the terms of this Agreement.
 
40

--------------------------------------------------------------------------------

2.6.2       Release on Payment in Full.

(a)            Upon payment in full of all principal and interest due on the
Loan and all other amounts due and payable under the Loan Documents in
accordance with the terms and provisions of the Loan Documents, upon the written
request and at the sole cost and expense of Borrower, Lender shall release the
Lien of the Security Instrument.
 
(b)            In connection with the release of the Security Instrument,
Borrower shall submit to Lender, concurrently with the request under Section
2.6.2(a), a release of Lien (and the related Loan Documents) for the Property
for execution by Lender.  Such release shall be in a form appropriate in the
jurisdiction in which the Property is located and that would be satisfactory to
a prudent lender and contains standard provisions, if any, protecting the rights
of the releasing lender.  In addition, Borrower shall provide all other
certificates, documents and instruments Lender reasonably requires to be
delivered by Borrower in connection with such release, together with an
Officer’s Certificate certifying that such documentation (i) is in compliance
with all applicable Legal Requirements, and (ii) will effect such release in
accordance with the terms of this Agreement.

Section 2.7.           Clearing Account/Cash Management Account.

2.7.1       Clearing Account.

(a)            During the term of the Loan, Borrower shall establish and
maintain an account (the “Clearing Account”) with Clearing Bank in trust for the
benefit of Lender in accordance with the Clearing Account Agreement.  The
Clearing Account shall be under the sole dominion and Control of Lender.  Lender
and Servicer shall have the sole right to make withdrawals from the Clearing
Account, subject to the terms set forth herein and in the other Loan Documents
permitting disbursements from the same.  All costs and expenses for establishing
and maintaining the Clearing Account shall be paid by Borrower.
 
(b)           Borrower shall cause all Rents to be delivered directly to the
Clearing Account.  In accordance with the Clearing Account Agreement, Borrower
shall, or, if applicable, shall cause Manager to, deliver irrevocable written
instructions to all tenants under Leases to deliver all Rents payable thereunder
directly to the Clearing Account.   Notwithstanding anything to the contrary
contained herein or in any other Loan Documents, in the event Borrower or
Manager (if any) shall receive any amounts constituting Rents, Borrower shall,
and shall cause Manager (if any) to, deposit all such amounts received by
Borrower or Manager into the Clearing Account within two (2) Business Day after
receipt thereof.
 
(c)            Borrower shall obtain from Clearing Bank its agreement to
transfer, from and after such time as Clearing Bank has received a Cash
Management Activation Notice and until such time as Clearing Bank has received a
Cash Management De-Activation Notice, all amounts on deposit in the Clearing
Account to the Cash Management Account in immediately available funds by federal
wire transfer once every Business Day.
 
(d)           Upon the occurrence and during the continuation of an Event of
Default, Lender may, in addition to any and all other rights and remedies
available to Lender, apply any amounts then on deposit in the Clearing Account
to the payment of the Debt in any order, proportion and priority as Lender may
determine in its sole and absolute discretion.

41

--------------------------------------------------------------------------------

(e)            The Clearing Account shall not be commingled with other monies
held by Borrower or Clearing Bank.
 
(f)            Borrower shall not further pledge, assign or grant any security
interest in the Clearing Account or the monies deposited therein or permit any
lien or encumbrance to attach thereto, or any levy to be made thereon, or any
UCC-1 Financing Statements, except those naming Lender as the secured party, to
be filed with respect thereto.
 
(g)           Borrower shall indemnify Lender and hold Lender harmless from and
against any and all actions, suits, claims, demands, liabilities, losses,
damages, obligations and reasonable costs and expenses (including reasonable
attorneys’ fees and expenses) arising from or in any way connected with the
Clearing Account and/or the Clearing Account Agreement or the performance of the
obligations for which the Clearing Account was established.

2.7.2        Cash Management Account.

(a)           During the term of the Loan, Borrower shall establish and maintain
a segregated Eligible Account (the “Cash Management Account”) to be held by Cash
Management Bank in trust and for the benefit of Lender in accordance with the
Cash Management Agreement.  The Cash Management Account shall be under the sole
dominion and Control of Lender.  Lender and Servicer shall have the sole right
to make withdrawals from the Cash Management Account, subject to the terms set
forth herein and in the other Loan Documents permitting disbursements from the
same.  All costs and expenses for establishing and maintaining the Cash
Management Account shall be paid by Borrower.
 
(b)              Provided that no Event of Default shall have occurred and
remain outstanding, on each Business Day during a Cash Management Trigger Event
Period, all funds on deposit in the Cash Management Account shall be applied in
the following amounts and order of priority:
 
(i)             First, funds sufficient to pay the next monthly deposit to the
Tax Funds in accordance with the terms and conditions of Section 6.2 hereof;
 
(ii)            Second, funds sufficient to pay the next monthly deposit to the
Insurance Funds in accordance with the terms and conditions of Section 6.3
hereof;
 
(iii)           Third, funds sufficient to pay the fees and expenses of Cash
Management Bank then due and payable to Cash Management Bank in accordance with
the Cash Management Agreement;
 
(iv)           Fourth, funds sufficient to pay the next Monthly Debt Service
Payment Amount;
 
(v)            Fifth, funds sufficient to pay the next monthly deposit to the
Capital Expenditure Funds in accordance with the terms and conditions of Section
6.4 hereof;
 
42

--------------------------------------------------------------------------------

(vi)         Sixth, funds sufficient to pay the next monthly deposit to the
Rollover Funds in accordance with the terms and conditions of Section 6.5
hereof;
 
(vii)         Seventh, funds sufficient to pay any interest accruing at the
Default Rate (without duplication with clause (iv) above), late payment charges
and any other amounts then due and payable under the Loan Documents;
 
(viii)         Eighth, funds sufficient to pay for Operating Expenses for the
applicable period incurred in accordance with an Approved Annual Budget and as
set forth in a request for payment submitted by Borrower to Lender specifying
the individual Operating Expenses in form and substance reasonably acceptable to
Lender;
 
(ix)           Ninth, funds sufficient to pay for Extraordinary Expenses for the
applicable period approved by Lender, if any;
 
(x)            Tenth, during the continuation of a Material Tenant Trigger Event
with respect to which a Material Tenant Trigger Event Cure has not occurred, the
remaining amount (the “Material Tenant Trigger Event Excess Cash Flow”) shall be
deposited into the Material Tenant Rollover Account in accordance with the terms
and conditions of Section 6.13 hereof.
 
(xi)           Eleventh, during the continuation of a Cash Sweep Trigger Event
(other than a Material Tenant Trigger Event), the remaining amount (the “Excess
Cash Flow”) shall be deposited into the Excess Cash Flow Account and held and
applied in accordance with the terms and conditions of Sections 6.7 hereof; and
 
(xii)          Lastly, provided no Cash Sweep Trigger Event or Material Tenant
Trigger Even exists, the remaining amount shall be deposited into an account
designated by Borrower in accordance with the Cash Management Agreement.
 
(c)           Notwithstanding anything to the contrary contained in this
Agreement, the Note or the other Loan Documents, upon the occurrence and during
the continuation of an Event of Default, Lender may, in addition to any and all
other rights and remedies available to Lender, apply any amounts then on deposit
in the Cash Management Account to the payment of the Debt in any order,
proportion and priority as Lender may determine in its sole and absolute
discretion.
 
(d)           Borrower hereby agrees that Lender may modify the Cash Management
Agreement for the purpose of establishing additional sub-accounts in connection
with any payments otherwise required under this Agreement, the Note and the
other Loan Documents, which sub-accounts shall at all times be Eligible Accounts
(and may be ledger or book entry accounts and not actual accounts).  All costs
and expenses for establishing and maintaining such accounts shall be paid by
Borrower.

2.7.3       Payments Received Under Cash Management Agreement.  The
insufficiency of funds on deposit in the Cash Management Account shall not
relieve Borrower from the obligation to make any payments, as and when due
pursuant to this Agreement, the Note and the other Loan Documents, and such
obligation shall be separate and independent, and not conditioned on any event
or circumstance whatsoever.  Notwithstanding anything to the contrary contained
in this Agreement, the Note or the other Loan Documents, and provided that no
Event of Default shall have occurred and remain outstanding, Borrower’s
obligations with respect to the payment of the Monthly Debt Service Payment
Amount and amounts required to be deposited into the Reserve Funds, if any,
shall be deemed satisfied to the extent sufficient amounts are deposited in the
Cash Management Account to satisfy such obligations pursuant to the Cash
Management Agreement on the dates each such payment is required, regardless of
whether any of such amounts are so applied by Lender.
 

43

--------------------------------------------------------------------------------

III.           REPRESENTATIONS AND WARRANTIES
 
Section 3.1.           Borrower Representations.
 
Borrower represents and warrants to Lender as of the Closing Date (and as of
such other dates specified below) that:
 
3.1.1       Organization.
 
(a)           Each of Borrower and Sole Member is, and since the date of its
respective formation has been, duly organized, validly existing and in good
standing with full power and authority to own its assets and conduct its
business, and is, and since the date of its respective formation has been, duly
qualified and in good standing in all jurisdictions in which the ownership or
leasing of its property or the conduct of its business requires such
qualification (except where the failure to be so qualified would not have a
Material Adverse Effect) and Borrower has taken all necessary action to
authorize the execution, delivery and performance of this Agreement and the
other Loan Documents by it, and has the power and authority to execute, deliver
and perform under this Agreement, the other Loan Documents and all the
transactions contemplated hereby and thereby.
 
(b)           Borrower’s exact legal name is correctly set forth in the first
paragraph of this Agreement.  Borrower is an organization of the type specified
in the first paragraph of this Agreement.  Borrower is incorporated or organized
under the laws of the state specified in the first paragraph of this Agreement. 
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 (4) months
(or, if less than four (4) months, the entire period of the existence of
Borrower) and will continue to be the address of Borrower set forth in the first
paragraph of this Agreement (unless Borrower notifies Lender in writing at least
thirty (30) days prior to the date of such change).  Borrower’s organizational
identification number, if any, assigned by the state of its incorporation or
organization is 6460062.  Borrower’s federal tax identification number is
33-0336973.
 
3.1.2       Proceedings.  This Agreement and the other Loan Documents have been
duly authorized, executed and delivered by or on behalf of Borrower and, to
Borrower’s knowledge, constitute legal, valid and binding obligations of
Borrower, enforceable against Borrower in accordance with their respective
terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors’ rights
generally and by general principles of equity (regardless of whether such
enforcement is sought in a proceeding in equity or at law).
 
44

--------------------------------------------------------------------------------

3.1.3       No Conflicts.  The execution, delivery and performance of this
Agreement and the other Loan Documents by Borrower 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 asset or
property of Borrower pursuant to the terms of any indenture, mortgage, deed of
trust, loan agreement, partnership agreement, management agreement or other
agreement or instrument to which Borrower is a party or by which any of
Borrower’s assets or properties is subject, nor will such action result in any
violation of the provisions of any Legal Requirements of any Governmental
Authority having jurisdiction over Borrower or any of Borrower’s assets or
properties.
 
3.1.4       Litigation.  There is no action, suit, proceeding or investigation
pending or, to Borrower’s knowledge, threatened against Borrower, Sole Member,
Guarantor, Manager or the Property in any court or by or before any other
Governmental Authority that is reasonably likely to have a Material Adverse
Effect.
 
3.1.5       Agreements.  Borrower is not a party to any agreement or instrument
or subject to any restriction which could materially and adversely affect
Borrower or the Property, or Borrower’s business, assets or properties,
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 Permitted Encumbrance or
any other agreement or instrument to which it is a party or by which Borrower or
the Property is bound.  Borrower has no material financial obligation
(contingent or otherwise) under any indenture, mortgage, deed of trust, loan
agreement or other 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 as permitted
under Section 3.1.24(d) hereof and (b) obligations under the Loan Documents.
 
3.1.6       Consents.  Each consent, approval, authorization, order,
registration or qualification of or with any court or any other Governmental
Authority required for the execution, delivery and performance by Borrower of
this Agreement and the other Loan Documents has been obtained and is in full
force and effect.
 
3.1.7       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.  The Security Instrument, together with any Uniform
Commercial Code financing statements required to be filed in connection
therewith, when properly recorded in the appropriate records, 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 thereof, in each case subject only to the Permitted
Encumbrances.  There are no claims for payment or mechanic’s, materialman’s or
other similar liens or claims which have been filed for work, labor or materials
affecting the Property which are or may become Liens prior to, or of equal
priority with, the Lien of the Security Instrument and the other Loan
Documents.  None of the Permitted Encumbrances, individually or in the
aggregate, materially interfere with the benefits of the security intended to be
provided by the Security Instrument and the other Loan Documents, materially and
adversely affect the value of the Property, impair the use or operation of the
Property or impair Borrower’s ability to perform its Obligations in a timely
manner.
 
45

--------------------------------------------------------------------------------

3.1.8       No Plan Assets.  As of the date hereof and throughout the Term, (a)
Borrower does not sponsor, is not obligated to contribute to and is not itself
and will not be an “employee benefit plan,” as defined in Section 3(3) of ERISA,
subject to Title I of ERISA or Section 4975 of the Code, (b) 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, (c) Borrower is not
and will not be a “governmental plan” within the meaning of Section 3(32) of
ERISA, and (d) transactions by or with Borrower are not and will not be subject
to any statute, rule or regulation regulating investments of, or fiduciary
obligations with respect to, “governmental plans” within the meaning of Section
3(32) of ERISA which is similar to the provisions of Section 406 of ERISA or
Section 4975 of the Code and which prohibit or otherwise restrict the
transactions contemplated by this Agreement (including, but not limited to, the
exercise by Lender of any of its rights under the Loan Documents).
 
3.1.9       Compliance.  Borrower and the Property and the use thereof comply in
all material respects with all applicable Legal Requirements, including, without
limitation, building and zoning ordinances and codes.  In the event that all or
any part of the Improvements are destroyed or damaged, said Improvements can be
legally reconstructed in all material respects to their condition prior to such
damage or destruction, and thereafter exist for the same use without violating
any zoning or other ordinances applicable thereto and without the necessity of
obtaining any variances or special permits.  No legal proceedings are pending
or, to the knowledge of Borrower, threatened in writing with respect to the
zoning of the Property.  Neither the zoning nor any other right to construct,
use or operate the Property is in any way dependent upon or related to any
property other than the Property.  Borrower is not in default or violation of
any order, regulation, writ, injunction, decree or demand of any Governmental
Authority, the violation of which could have a Material Adverse Effect.  There
has not been committed by Borrower or any other Person in occupancy of or
involved with the operation or use of the Property any act or omission affording
the federal government, any state or local government or any other 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.
 
3.1.10     Financial Information.  All financial data, including, without
limitation, the statements of cash flow and income and operating expense, that
have been delivered to Lender in respect of the Property or otherwise in
connection with the Loan (i) are true, correct and complete in all material
respects, (ii) accurately represent the financial condition of Borrower and the
Property, as applicable, as of the date of such reports, and (iii) have been
prepared in accordance with the Acceptable Accounting Basis and consistently
applied throughout the periods covered.  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 that could have a Material Adverse Effect.  Since the date of
such financial statements, there has been no material adverse change in the
financial condition, operation or business of Borrower or the Property from that
set forth in said financial statements.
 
46

--------------------------------------------------------------------------------

3.1.11     Condemnation.  No Condemnation or other similar proceeding has been
commenced or, to Borrower’s best knowledge, has been threatened or is
contemplated with respect to all or any portion of the Property or for the
relocation of roadways providing access to the Property.
 
3.1.12     Easements; Utilities and Public Access.  The Property has rights of
access to public ways and is served by water, sewer, sanitary sewer and storm
drain facilities adequate to service the Property for its intended uses.  All
public utilities necessary or convenient to the continued use and enjoyment of
the Property are located either in the public right‑of‑way abutting the Property
(which are connected so as to serve the Property without passing over any 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 applicable Governmental Authorities.
 
3.1.13     Separate Lots.  The Property is comprised of one (1) or more parcels
which constitute a separate tax lot or lots and does not constitute a portion of
any other tax lot not a part of the Property.
 
3.1.14     Assessments.  There are no pending or, to Borrower’s best knowledge,
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.
 
3.1.15     Enforceability .  The Loan Documents are not subject to any right of
rescission, set‑off, counterclaim or defense by Borrower, Sole Member or
Guarantor, 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 (subject only to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors’ rights
generally and, as to enforceability, to principles of equity), and neither
Borrower, Sole Member nor Guarantor has asserted any right of rescission,
set‑off, counterclaim or defense with respect thereto.
 
3.1.16     Assignment of Leases.  The Assignment of Leases creates a valid
assignment of, or a valid security interest in, certain rights under the Leases,
subject only to a license granted to Borrower to exercise certain rights and to
perform certain obligations of the lessor under the Leases, as more particularly
set forth therein.  No Person other than Lender has any interest in or
assignment of the Leases or any portion of the Rents due and payable or to
become due and payable thereunder.
 
3.1.17     Insurance.  Borrower has obtained and has delivered to Lender (a)
original or certified copies of the Policies or certificates of insurance
reasonably acceptable to Lender reflecting the insurance coverages, amounts and
other requirements set forth in this Agreement and (b) evidence reasonably
acceptable to Lender that all premiums thereunder have been prepaid.  No claims
have been made under any of the Policies, and no Person, including Borrower, has
done, by act or omission, or anything which would impair the coverage of any of
the Policies.
 
47

--------------------------------------------------------------------------------

3.1.18     Licenses.  All approvals, authorizations, certifications, licenses
and permits, including, without limitation, certificates of completion and
occupancy, required by any Governmental Authority or otherwise necessary for the
legal ownership, use, occupancy and operation of the Property in the manner in
which the Property is currently being owned, used, occupied and operated have
been obtained by or on behalf of Borrower and are in full force and effect.
 
3.1.19     Flood Zone.  None of the Improvements on the Property is located in
an area identified by the Federal Emergency Management Agency as a special flood
hazard area (or, if so located, the flood insurance required pursuant to Section
5.1.1(a)(i) is in full force and effect with respect to the Property).
 
3.1.20     Physical Condition.  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; to Borrower’s knowledge, there exists no
structural or other material defects or damages in the Property, whether latent
or otherwise; and 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 any termination or
threatened termination of any policy of insurance or bond.
 
3.1.21    Boundaries.  All of the improvements which were included in
determining the appraised value of the Property lie wholly within the boundaries
and building restriction lines of the Property, and no improvements on adjoining
properties encroach upon the Property.  No easements or other encumbrances
affecting the Property encroach upon any of the Improvements so as to affect the
value, marketability, use or operation of the Property except those which are
insured against by the Title Insurance Policy, each of which, whether or not
insured against by the Title Insurance Policy, is shown on the Survey.
 
48

--------------------------------------------------------------------------------

3.1.22     Leases .  Borrower represents and warrants to Lender with respect to
the Leases that:  (a) the rent roll attached hereto as Schedule 3.1.22 is true,
correct and complete and the Property is not subject to any Leases other than
the Ionis Lease, (b) the Ionis Lease is in full force and effect and there are
no defaults thereunder by any party thereto and there are no conditions that,
with the passage of time or the giving of notice, or both, would constitute
defaults thereunder by any party thereto, (c) the copies of the Leases delivered
to Lender are true, correct and complete, and there are no oral agreements with
respect thereto, (d) no Rent (including security or other deposits) has been
paid more than one (1) month in advance of its due date, (e) all work to be
performed by the landlord under each Lease has been performed as required and
has been accepted by the applicable Tenant, (f) any payments, free rent, partial
rent, rebate of rent or other payments, credits, allowances or abatements
required to be given by the landlord to any Tenant has already been received by
such Tenant, (g) all security or other deposits are being held in accordance
with the applicable Leases and all applicable Legal Requirements, (h) Borrower
has no knowledge of any notice of termination or default with respect to any
Lease, (i) Borrower has not assigned or pledged any of the Leases, the rents or
any interest therein except to Lender, (j) no Tenant or other Person has an
option, right of first refusal or offer or any other preferential right to
purchase all or any portion of, or interest in, the Property, (k) no Tenant has
any right or option for additional space in the Improvements, (l) no Tenant has
assigned its Lease or sublet all or any portion of the premises demised thereby,
(m) no Tenant has the right to terminate its Lease prior to expiration of the
stated term of such Lease, (n) to Borrower’s knowledge, no  Hazardous Substances
have been disposed, stored or treated by any Tenant on, under or about the
Property, other than in compliance with all Legal Requirements and Environmental
Laws, (o) Borrower does not have any knowledge of any Tenant’s intention to use
its leased premises for any activity which, directly or indirectly, involves the
use, generation, treatment, storage, disposal or transportation of any petroleum
product or any other Hazardous Substances, other than in compliance with all
legal requirements and Environmental Laws, and (p) all existing Leases are
subordinate to the Security Instrument either pursuant to their terms or a
recorded subordination agreement.  Borrower acknowledges and agrees that the
Ionis Lease is a “true lease” and does not represent a financing arrangement and
Borrower covenants and agrees that it will reflect the Ionis Lease in all
applicable books, records and reports in a manner consistent with true lease
treatment.
 
3.1.23     Filing, Recording and Other Taxes.  All transfer taxes, deed stamps,
intangible taxes or other amounts in the nature of transfer taxes required to be
paid under the applicable Legal Requirements in connection with the transfer of
the Property to Borrower have been paid or are being paid simultaneously
herewith.  All mortgage, mortgage recording, stamp, intangible or other similar
taxes required to be paid under the applicable Legal Requirements in connection
with the execution, delivery, recordation, filing, registration, perfection or
enforcement of any of the Loan Documents, including, without limitation, the
Security Instrument, have been paid or are being paid simultaneously herewith. 
All taxes and governmental assessments due and owing in respect of the Property
have been paid, or an escrow of funds in an amount sufficient to cover such
payments has been established under the Loan Documents.
 
3.1.24     Single Purpose.
 
Borrower hereby represents and warrants to, and covenants with, Lender that
since the date of its formation and at all times on and after the date hereof
and until such time as the Debt shall be paid in full:
 
(a)           Borrower (i) has been, is, and will be organized solely for the
purpose of acquiring, owning, leasing, managing and operating the Property,
entering into and performing its obligations under the Loan Documents,
refinancing the Property in connection with a permitted repayment of the Loan,
and transacting lawful business that is incident, necessary and appropriate to
accomplish the foregoing, and (ii) has not owned, does not own, and will not own
any asset or property other than (A) the Property, and (B) incidental personal
property necessary for the  ownership, leasing, management or operation of the
Property.
 
49

--------------------------------------------------------------------------------

(b)           Borrower has not engaged and will not engage in any business or
activity other than the acquisition, ownership, leasing, management and
operation of the Property and Borrower will conduct and operate its business as
presently conducted and operated.
 
(c)           Borrower has not entered and will not enter into any contract or
agreement with any Affiliate of Borrower, any constituent party of Borrower or
any Affiliate of any constituent party, except in the ordinary course of
business and 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 from an unrelated third party.
 
(d)           Borrower has not incurred and will not incur any Indebtedness
other than (i) the Debt and (ii) unsecured trade payables and operational debt
not evidenced by a note and in an aggregate amount not exceeding three percent
(3%) of the Outstanding Principal Balance at any one time; provided that any
Indebtedness incurred pursuant to clause (ii) shall be (A) outstanding not more
than sixty (60) days and (B) incurred in the ordinary course of business.  No
Indebtedness, other than the Debt, may be secured (senior, subordinate or pari
passu) by the Property.
 
(e)           Borrower has not made and will not make any loans or advances to
any other Person (including any Affiliate of Borrower, any constituent party of
Borrower or any Affiliate of any constituent party), and has not acquired and
shall not acquire obligations or securities of its Affiliates.
 
(f)            Borrower has been, is, and will endeavor to remain solvent and
Borrower has paid its debt and liabilities (including, as applicable, shared
personnel and overhead expenses) from its assets as the same became due and will
pay its debts and liabilities (including, as applicable, shared personnel and
overhead expenses) from its assets as the same shall become due; provided that
the foregoing shall not create an obligation on the part of any direct or
indirect member, partner, shareholder, beneficiary or other beneficial interest
holder in Borrower, or any officer, director, employee, trustee, beneficiary or
Affiliate of any of the foregoing to make capital contributions, equity
infusions or loans to Borrower.
 
(g)           Borrower has done or caused to be done, and will do and cause to
be done, all things necessary to observe its organizational formalities and
preserve its separate existence, (ii) Borrower has not terminated or failed to
comply with and will not terminate or fail to comply with the provisions of its
Organizational Documents, (iii) Borrower has not amended, modified or otherwise
changed its Organizational Documents and (iv) unless (A) Lender has consented in
writing and (B) following a Securitization of the Loan, the Rating Agencies have
issued a Rating Agency Confirmation in connection therewith, Borrower will not
amend, modify or otherwise change its Organizational Documents except:  (i) to
cure any obvious ambiguity or (ii) to correct or supplement any provision in a
manner consistent with the intent of this Agreement and the other Loan
Documents.
 
(h)           Borrower has maintained and will maintain all of its books,
records, financial statements and bank accounts separate from those of its
Affiliates and any other Person.  Borrower’s assets have not been listed as
assets on the financial statement of any other Person; provided, however, that
Borrower’s assets may have been included in a consolidated financial statement
of its Affiliates; provided that, if applicable, (i) appropriate notation (e.g.,
footnote) were made on such consolidated financial statements to indicate the
separateness of Borrower and such Affiliates and to indicate that Borrower’s
assets and credit were not available to satisfy the debts and other obligations
of such Affiliates or any other Person, and (ii) such assets were listed on
Borrower’s own separate balance sheet.  Borrower’s assets will not be listed as
assets on the financial statement of any other Person; provided, however, that
Borrower’s assets may be included in a consolidated financial statement of its
Affiliates provided that (A) appropriate notation (e.g., footnote) shall be made
on such consolidated financial statements to indicate the separateness of
Borrower and such Affiliates and to indicate that Borrower’s assets and credit
are not available to satisfy the debts and other obligations of such Affiliates
or any other Person, and (B) such assets shall be listed on Borrower’s own
separate balance sheet.  Borrower shall file its own tax returns (except to the
extent that Borrower is treated as a “disregarded entity” for tax purposes and
was or is not required to file tax returns under applicable law), has not filed
and shall not file a consolidated federal income tax return with any other
Person, and has paid and shall pay any taxes required to be paid under
applicable law.  Borrower has maintained and shall maintain its books, records,
resolutions and agreements as official records.
 
50

--------------------------------------------------------------------------------

(i)             Borrower (i) has been, will be, and at all times has held and
will hold itself out to the public as, a legal entity separate and distinct from
any other entity (including any Affiliate of Borrower or any constituent party
of Borrower), (ii) has corrected and shall correct any known misunderstanding
regarding its status as a separate entity, (iii) has conducted and shall conduct
business solely in its own name, (iv) has not identified and shall not identify
itself or any of its Affiliates as a division or department or part of the other
(except as required under Acceptable Accounting Basis with respect to a
disregarded entity for tax purposes) and (v) has maintained and utilized and
shall maintain and utilize separate stationery, invoices and checks bearing its
own name.
 
(j)             Borrower has maintained and will endeavor 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;
provided, that the foregoing shall not create an obligation on the part of any
direct or indirect member, partner, shareholder, beneficiary or other beneficial
interest holder in Borrower, or any officer, director, employee, trustee,
beneficiary or Affiliate of any of the foregoing to make capital contributions,
equity infusions or loans to Borrower.
 
(k)           Neither Borrower nor any constituent party of Borrower has sought
and, to the fullest extent permitted by applicable law, neither Borrower nor any
constituent party of Borrower will seek or effect the liquidation, dissolution,
winding up, consolidation or merger, in whole or in part, of Borrower, any sale
or other transfer of all or substantially all of its assets or any sale or other
transfer outside the ordinary course of business.
 
(l)             Borrower has not commingled and will not commingle funds or
other assets of Borrower with those of any Affiliate or constituent party or any
other Person, and has held and will hold all of its assets solely in its own
name.
 
51

--------------------------------------------------------------------------------

(m)           Borrower has maintained and will maintain its assets in such a
manner that it will not be costly or difficult to segregate, ascertain or
identify its individual assets from those of any Affiliate or constituent party
or any other Person.
 
(n)           Borrower did not assume, guarantee or become obligated for the
debts or obligations of any other Person and did not hold itself out to be
responsible for or have its credit or assets available to satisfy the debts or
obligations of any other Person.  Borrower will not assume, guarantee or become
obligated for the debts or obligations of any other Person and does not and will
not hold itself out to be responsible for or have its credit or assets available
to satisfy the debts or obligations of any other Person.
 
(o)           The Organizational Documents of Borrower shall provide that the
business and affairs of Borrower shall be managed by Sole Member and at all
times shall have at least one (1) Independent Director designated by Sole
Member.  As used herein, the term “Independent Director” shall refer to a duly
appointed individual, who has at least three (3) years prior employment
experience and continues to be employed as an independent director, independent
manager or independent member by CT Corporation, Corporation Service Company,
National Registered Agents, Inc., Wilmington Trust Company, Wilmington Trust
National Association, Wilmington Trust SP Services, Inc., Stewart Management
Company, Lord Securities Corporation or, if none of those companies is then
providing professional independent directors, independent managers and
independent members, another nationally-recognized company that provides such
services and which is reasonably approved by Lender; (ii) is not, and has never
been, and will not, while serving as an Independent Director be, any of the
following: (A) a director, manager, officer, employee, partner, member, attorney
or counsel of Borrower, any Affiliate of Borrower any direct or indirect equity
holder of any of them, (B) a creditor, supplier, service provider (including
provider of professional services) to Borrower or any Affiliate of Borrower
(other than a nationally-recognized company that routinely provides professional
independent directors, independent managers or independent members and other
corporate services to Borrower or any Affiliate of Borrower in the ordinary
course of its business), (C) a member of the immediate family of any such
director, manager, officer, employee, partner, member, creditor, supplier,
service provider or other Person, or (D) a Person Controlling or under common
Control with any of the Persons described in clause (A), (B) or (C) above.  A
natural person who satisfies the foregoing definition other than clause (ii)
shall not be disqualified as a result of clause (ii)(A) by reason of (I) being,
having been or becoming an Independent Director of an Affiliate of Borrower that
is not in the direct chain of ownership of Borrower or Sole Member and that is
required by a creditor to be a “single purpose entity”; provided that such
Independent Director is, was or will be employed by a company that routinely
provides professional independent directors, independent managers or independent
members, or (II) being, having been or becoming a member of Borrower pursuant to
an express provision in Borrower’s operating agreement providing for the
appointment of such Independent Director as a member of Borrower upon the
occurrence of any event pursuant to which Sole Member ceases to be a member of
Borrower (including the withdrawal or dissolution of Sole Member).  A natural
person who satisfies the foregoing definition other than clause (ii) shall not
be disqualified as a result of clause (ii)(A) or (ii)(B) by reason of being,
having been or becoming an Independent Director of a “single purpose entity”
affiliated with Borrower; provided that the fees or other compensation that such
individual earns by serving as an Independent Director of one or more Affiliates
of Borrower in any given year constitute, in the aggregate, less than five
percent (5%) of such individual’s income for such year.  The Organizational
Documents of Borrower shall provide that no Independent Director of Borrower may
be removed or replaced without Cause, and unless Borrower provides Lender with
not less than three (3) Business Days’ prior notice of (1) any proposed removal
of any Independent Director, together with a statement as to the reasons for
such removal, and (2) the identity of the proposed replacement Independent
Director, together with a certification that such replacement satisfies the
requirements set forth in the Organizational Documents of Borrower relating to
an Independent Director.  In addition, the Organizational Documents of Borrower
shall provide an express acknowledgment that Lender is an intended third-party
beneficiary of the “special purpose” and “separateness” provisions of such
Organizational Documents.  As used in this paragraph, the term “single purpose
entity” shall mean a Person whose Organizational Documents contain, and who
covenants that such Person shall comply or cause compliance with, provisions
substantially similar to those set forth in this Section 3.1.24.
 
52

--------------------------------------------------------------------------------

(p)           The Organizational Documents of Borrower shall provide that
Borrower will not (and Borrower agrees that it will not), without the consent of
the Independent Director, (i) file or consent to the filing of any petition,
either voluntary or involuntary, to take advantage of any applicable insolvency,
bankruptcy, liquidation or reorganization statute, (ii) seek or consent to the
appointment of a receiver, liquidator or any similar official for Borrower or a
substantial portion of its assets or properties, (iv) make an assignment for the
benefit of creditors, (v) admit in writing Borrower’s inability to pay its debts
generally as they become due, or (vi) take any action in furtherance of any of
the foregoing.  In addition, the Organizational Documents of Borrower shall
provide that, when voting with respect to any of the matters set forth in the
immediately preceding sentence of this Section 3.1.24(p), the Independent
Director shall consider only the interests of Borrower, including its creditors.
 
(q)           The Organizational Documents of Borrower shall provide that, as
long as any portion of the Debt remains outstanding, upon the occurrence of any
event that causes the sole member of Borrower (“Sole Member”) to cease to be a
member of Borrower (other than (i) upon an assignment by Sole Member of all of
its limited liability company interests in Borrower and the admission of the
transferee, if permitted pursuant to the Organizational Documents of Borrower
and the Loan Documents, or (ii) the resignation of Sole Member and the admission
of an additional member of Borrower, if permitted pursuant to the Organizational
Documents of Borrower and the Loan Documents), the person acting as an
Independent Director of Borrower shall, without any action of any Person and
simultaneously with Sole Member ceasing to be a member of Borrower,
automatically be admitted as a member of Borrower (a “Special Member”) and shall
preserve and continue the existence of Borrower without dissolution.  The
Organizational Documents of Borrower shall further provide that for so long as
any portion of the Debt is outstanding, no Special Member may resign or transfer
its rights as a Special Member unless (A) a successor Special Member has been
admitted to Borrower as a Special Member, and (B) such successor Special Member
has also accepted its appointment as an Independent Director of Borrower.
 
(r)            The Organizational Documents of Borrower shall provide that, as
long as any portion of the Debt remains outstanding, except as expressly
permitted pursuant to the terms of the Loan Documents, (i) Sole Member may not
resign, and (ii) no additional member shall be admitted to Borrower.
 
53

--------------------------------------------------------------------------------

(s)           The Organizational Documents of Borrower shall provide that, as
long as any portion of the Debt remains outstanding: (i) Borrower shall be
dissolved, and its affairs shall be wound up, only upon the first to occur of
the following: (A) the termination of the legal existence of the last remaining
member of Borrower or the occurrence of any other event which terminates the
continued membership of the last remaining member of Borrower in Borrower unless
the business of Borrower is continued in a manner permitted by its operating
agreement or the Delaware Limited Liability Company Act (the “Act”), or (B) the
entry of a decree of judicial dissolution under Section 18-802 of the Act; (ii)
upon the occurrence of any event that causes the last remaining member of
Borrower to cease to be a member of Borrower or that causes Sole Member to cease
to be a member of Borrower (other than (A) upon an assignment by Sole Member of
all of its limited liability company interests in Borrower and the admission of
the transferee, if permitted pursuant to the Organizational Documents of
Borrower and the Loan Documents, or (B) the resignation of Sole Member and the
admission of an additional member of Borrower, if permitted pursuant to the
Organizational Documents of Borrower and the Loan Documents), to the fullest
extent permitted by applicable law, the personal representative of such last
remaining member shall be authorized to, and shall, within ninety (90) days
after the occurrence of the event that terminated the continued membership of
such member in Borrower, agree in writing (1) to continue the existence of
Borrower, and (2) 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
such member in Borrower; (iii) the bankruptcy of Sole Member or a Special Member
shall not cause such Sole Member or Special Member to cease to be a member of
Borrower and upon the occurrence of such event, the business of Borrower shall
continue without dissolution; (iv) in the event of the dissolution of Borrower,
Borrower shall conduct only such activities as are necessary to wind up its
affairs (including the sale of its assets and properties in an orderly manner),
and its assets and properties shall be applied in the manner, and in the order
of priority, set forth in Section 18-804 of the Act; and (v) to the fullest
extent permitted by applicable law, each of Sole Member and Special Members
shall irrevocably waive any right or power that they might have to cause
Borrower or any of its assets or properties to be partitioned, to cause the
appointment of a receiver for all or any portion of the assets or properties of
Borrower, to compel any sale of all or any portion of the assets or properties
of Borrower pursuant to any applicable law or to file a complaint or to
institute any proceeding at law or in equity to cause the dissolution,
liquidation, winding up or termination of Borrower.
 
(t)            Borrower shall conduct its business so that the assumptions made
with respect to Borrower in the Insolvency Opinion shall be true and correct in
all respects.  In connection with the foregoing, Borrower hereby covenants and
agrees that it will comply with or cause the compliance with, (i) all of the
facts and assumptions (whether regarding Borrower or any other Person) set forth
in the Insolvency Opinion, (ii) all of the representations, warranties and
covenants in this Section 3.1.24, and (iii) all of the Organizational Documents
of Borrower.
 
(u)           Borrower has not permitted and will not permit any Affiliate
(other than Sole Member pursuant to the terms of the Organizational Documents of
Borrower) or constituent party independent access to its bank accounts.
 
(v)           Borrower has paid and shall pay its own liabilities and expenses,
including the salaries of its own employees (if any) from its own funds, and has
maintained and shall maintain a sufficient number of employees (if any) in light
of its contemplated business operations; provided that the foregoing shall not
create an obligation on the part of any direct or indirect member, partner,
shareholder, beneficiary or other beneficial interest holder in Borrower, or any
officer, director, employee, trustee, beneficiary or Affiliate of any of the
foregoing to make capital contributions, equity infusions or loans to Borrower.
 
54

--------------------------------------------------------------------------------

(w)          Borrower has compensated and shall compensate each of its
consultants and agents from its funds for services provided to it and Borrower
has paid and shall pay from its assets all obligations of any kind incurred;
provided that the foregoing shall not create an obligation on the part of any
direct or indirect member, partner, shareholder, beneficiary or other beneficial
interest holder in Borrower, or any officer, director, employee, trustee,
beneficiary or Affiliate of any of the foregoing to make capital contributions,
equity infusions or loans to Borrower.
 
(x)            Borrower has not (i) filed a bankruptcy, insolvency or
reorganization petition or otherwise instituted insolvency proceedings or
otherwise sought any relief under any laws relating to the relief from debts or
the protection of debtors generally, (ii) sought or consented to the appointment
of a receiver, liquidator, assignee, trustee, sequestrator, custodian or any
similar official for Borrower or for all or any portion of Borrower’s assets or
properties, (iii) made any assignment for the benefit of Borrower’s creditors or
(iv) admitted in writing Borrower’s inability to pay its debts generally as they
become due.  Without the unanimous consent of all of its directors or managers:
(including the Independent Director), as applicable, Borrower will not (A) file
a bankruptcy, insolvency or reorganization petition or otherwise institute
insolvency proceedings or otherwise seek any relief under any laws relating to
the relief from debts or the protection of debtors generally, (B) seek or
consent to the appointment of a receiver, liquidator, assignee, trustee,
sequestrator, custodian or any similar official for Borrower or for all or any
portion of Borrower’s assets or properties, (C) make any assignment for the
benefit of Borrower’s creditors or (D) admit in writing Borrower’s inability to
pay its debts generally as they become due.
 
(y)           Borrower has maintained and will maintain an arm’s-length
relationship with its Affiliates.
 
(z)            Borrower has allocated and will allocate fairly and reasonably
any overhead expenses that are shared with any Affiliate, including, without
limitation, shared office space.
 
(aa)         Except to Lender in connection with the Loan, Borrower has not
pledged and will not pledge its assets or properties for the benefit of, or to
secure the obligations of, any other Person.
 
(bb)        Borrower has had, has and will have no obligation to indemnify its
directors, managers, officers, members or Special Members, as the case may be,
or, if applicable, has such an obligation that is fully subordinated to the Debt
and that will not constitute a claim against Borrower if cash flow in excess of
the amount required to pay the Debt is insufficient to pay such obligation.
 
55

--------------------------------------------------------------------------------

(cc)         The Organizational Documents of Borrower shall provide that
Borrower will not:  (i) dissolve, merge, liquidate, consolidate; (ii) sell,
transfer, dispose, or encumber (except in accordance with the Loan Documents)
all or substantially all of its assets or properties or acquire all or
substantially all of the assets or properties of any other Person; or (iii)
engage in any other business activity, or amend its Organizational Documents
with respect to any of the matters set forth in this Section 3.1.24, without the
prior consent of Lender in its sole discretion.
 
(dd)        Borrower and the Independent Director will consider the interests of
Borrower’s creditors in connection with all actions.
 
(ee)         Borrower has not had and, except in connection with the Loan, does
not have and will not have any of its obligations guaranteed by any Affiliate.
 
(ff)           Borrower has not owned or acquired and will not own or acquire
any stock or securities of any Person (except to the extent expressly permitted
under the Loan Documents).
 
(gg)         Borrower has not bought or held and will not buy or hold evidence
of indebtedness issued by any other Person (other than cash or investment-grade
securities).
 
(hh)         Borrower has not formed, acquired or held and will not form,
acquire or hold any subsidiary (whether corporation, partnership, limited
liability company or other entity), and Borrower has not owned and will not own
any equity interest in any other entity.
 
3.1.25     Tax Filings.  To the extent required, Borrower has filed (or has
obtained effective extensions for filing) all federal, state and local tax
returns required to be filed and have paid or made adequate provision for the
payment of all federal, state and local taxes, charges and assessments payable
by Borrower.  Borrower believes that its tax returns (if any) properly reflect
the income and taxes of Borrower for the periods covered thereby, subject only
to reasonable adjustments required by the Internal Revenue Service or other
applicable tax authority upon audit.
 
3.1.26     Solvency.  Borrower (a) has not entered into the transaction or any
Loan Document with the actual intent to hinder, delay, or defraud any creditor
and (b) received reasonably equivalent value in exchange for its obligations
under the Loan Documents.  Giving effect to the Loan, the fair saleable value of
Borrower’s assets exceeds and will, immediately following the making of the
Loan, exceed Borrower’s total liabilities, including, without limitation,
subordinated, unliquidated, disputed and contingent liabilities.  The fair
saleable value of Borrower’s assets is and will, immediately following the
making of the Loan, be greater than Borrower’s probable liabilities, including
the maximum amount of its contingent liabilities on its debts as such debts
become or may become absolute and matured.  Borrower’s assets do not and,
immediately following the making of the Loan will not, constitute unreasonably
small capital to carry out its business as conducted or as proposed to be
conducted.  Borrower does not intend to, and does not believe that it will,
incur debt and liabilities (including contingent liabilities and other
commitments) beyond its ability to pay such debt and liabilities as they mature
(taking into account the timing and amounts of cash to be received by Borrower
and the amounts to be payable on or in respect of obligations of Borrower).
 
56

--------------------------------------------------------------------------------

3.1.27     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 Regulations T, U or X of the Board of Governors of the
Federal Reserve System or for any other purpose which would be inconsistent with
such Regulations T, U or X or any other Regulations of such Board of Governors,
or for any purposes prohibited by any Legal Requirements or by the terms and
conditions of this Agreement or the other Loan Documents.
 
3.1.28     Organizational Chart.  The organizational chart attached hereto as
Schedule 3.1.28, relating to Borrower and certain Affiliates and other Persons,
is true, correct and complete on and as of the date hereof.  No Person, other
than those Persons shown on Schedule 3.1.28, has any ownership interest in, or
right of Control, directly or indirectly, in Borrower, and no Prohibited Entity
holds any direct and/or indirect ownership interest in Borrower or the Property.
 
3.1.29     Bank Holding Company.  Borrower is not a “bank holding company” or a
direct or indirect subsidiary of a “bank holding company” as defined in the Bank
Holding Company Act of 1956, as amended, and Regulation Y thereunder of the
Board of Governors of the Federal Reserve System.
 
3.1.30     No Other Debt.  Borrower has not borrowed or received debt financing
(other than permitted pursuant to this Agreement) that has not been heretofore
repaid in full.
 
3.1.31     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; or (b) subject to any other federal
or state law or regulation which purports to restrict or regulate its ability to
borrow money.
 
3.1.32     Intentionally Omitted. 
 
3.1.33    No Bankruptcy Filing.  No petition in bankruptcy has ever been filed
against Borrower or any constituent party of Borrower, and neither Borrower nor
any constituent party of Borrower has ever made an assignment for the benefit of
creditors or taken advantage of any insolvency act for the benefit of debtors. 
Neither Borrower nor any of its constituent parties is contemplating either the
filing of a petition by it under any state or federal bankruptcy or insolvency
laws or the liquidation of all or a major portion of Borrower’s or such
constituent party’s assets or properties, and Borrower has no knowledge of any
Person contemplating the filing of any such petition against Borrower or any of
its constituent parties.
 
3.1.34     Full and Accurate Disclosure.  No information contained in this
Agreement, the other Loan Documents, or any written statement or document
furnished by or on behalf of Borrower in connection with the Loan (or, to the
best of Borrower’s knowledge, contained in any third party report obtained by
Borrower with respect to the Property (other than any third party reports
obtained by Lender in connection with the closing of the Loan)) or pursuant to
the terms of this Agreement or any other Loan Document contains any untrue
statement of a material fact or omits to state a material fact necessary to make
the statements contained herein or therein not misleading in light of the
circumstances under which they were made.  There is no fact or circumstance
presently known to Borrower which has not been disclosed to Lender and which is
reasonably likely to have a Material Adverse Effect.
 
57

--------------------------------------------------------------------------------

3.1.35     Foreign Person.  Borrower is not a “foreign person” within the
meaning of Section 1445(f)(3) of the Code.
 
3.1.36     No Change in Facts or Circumstances; Disclosure.  All information
submitted by and on behalf of Borrower to Lender and in all financial
statements, rent rolls (including the rent roll attached hereto as Schedule
3.1.22), reports, certificates and other documents submitted in connection with
the Loan or in satisfaction of the terms of this Agreement or the other Loan
Documents and all statements of fact made by or on behalf of Borrower in this
Agreement or in any other Loan Document, are true, correct and complete in all
material respects.  To the best of Borrower’s knowledge, there has been no
material adverse change in any condition, fact, circumstance or event that would
make any such information or statement of fact inaccurate, incomplete or
otherwise misleading in any material respect or that otherwise has or could have
a Material Adverse Effect.
 
3.1.37     Management Agreement.  As of the date hereof, the Property is not
subject to any Management Agreement and is self-managed by the Borrower.
 
3.1.38     Perfection of Accounts.  Borrower hereby represents and warrants to
Lender that:
 
(a)           This Agreement, together with the other Loan Documents, creates a
valid and continuing security interest (as defined in the Uniform Commercial
Code) in the Clearing Account and the Cash Management Account in favor of
Lender, which security interest is prior to all other Liens, and is enforceable
as such against creditors of and purchasers from Borrower.  The Clearing Account
and the Cash Management Account are not in the name of any Person other than
Borrower, as pledgor, and Lender, as pledgee.  Other than in connection with the
Loan Documents, Borrower has not sold, pledged, transferred or otherwise
conveyed the Clearing Account and the Cash Management Account;
 
(b)           The Clearing Account and the Cash Management Account constitute
“deposit accounts” or “securities accounts” within the meaning of the Uniform
Commercial Code; and
 
(c)           Borrower has not consented to Clearing Bank or Cash Management
Bank complying with instructions with respect to the Clearing Account or the
Cash Management Account from any Person other than Lender.
 
3.1.39     Intentionally Omitted.
 
3.1.40     REA. Borrower hereby represents and warrants to Lender with respect
to the REA:
 
(a)           Borrower is a party to the REA and, to the best of Borrower’s
knowledge, after due inquiry, the REA is in full force and effect and has not
been amended or modified and Borrower’s interest therein has not been assigned
pursuant to any assignment which survives the Closing Date except the assignment
to Lender pursuant to the Loan Documents.
 
58

--------------------------------------------------------------------------------

(b)           Borrower is not in default under the REA and, to the best of
Borrower’s knowledge, no other party to the REA is in default thereunder and
there is no existing condition which, but for the passage of time or the giving
of notice or both, could result in a default under the REA.
 
(c)           To the best of Borrower’s knowledge, after due inquiry, the
current addresses to which notices are sent to Borrower or any other party to
the REA are correctly set forth in the REA.
 
(d)           There are no set-offs, claims, counterclaims or defenses being
asserted or capable of being asserted after giving the requisite notice, if any,
required under the REA or otherwise known by Borrower or any other party to the
REA for the enforcement of the obligations of any party under the REA.
 
(e)           There are no Liens capable of being asserted for amounts due under
the provisions of the REA which, if unpaid, may be asserted as a Lien prior to
the Lien of the Security Instrument.
 
(f)            All common charges and other sums due from Borrower under the REA
have been paid to the extent they are payable on or prior to the date hereof.
 
(g)           Lender is a “Mortgagee” for purposes of the REA and is entitled to
all rights of a “Mortgagee” or holder of a “Mortgage” as defined in the REA.
 
3.1.41     Patriot Act.
 
(a)           None of Borrower, Guarantor or any Person who Controls Borrower or
Guarantor, and to the best of Borrower’s knowledge, any of their respective
brokers or other agents acting or benefiting in any capacity in connection with
the Loan is a Prohibited Person.
 
(b)           None of Borrower, Guarantor or any Person who Controls Borrower or
Guarantor and, and to the best of Borrower’s knowledge, any of their respective
brokers or other agents acting in any capacity in connection with the Loan, (i)
has conducted or will conduct any business or has engaged or will engage in any
transaction or dealing with any Prohibited Person, including making or receiving
any contribution of funds, goods or services to or for the benefit of any
Prohibited Person, (ii) has dealt or will deal in, or otherwise has engaged or
will engage in, any transaction relating to, any property or interests in
property blocked pursuant to Executive Order No. 13224; or (iii) has engaged or
will engage in or has conspired or will conspire to engage in any transaction
that evades or avoids, or has the purpose of evading or avoiding, or attempts to
violate, any of the prohibitions set forth in the Patriot Act.
 
(c)            Borrower covenants and agrees to deliver to Lender any
certification or other evidence requested from time to time by Lender in its
sole discretion, confirming Borrower’s compliance with this Section 3.1.41.
 
59

--------------------------------------------------------------------------------

3.1.42     Intentionally Omitted..
 
3.1.43     No Casualty.  The Property has suffered no material Casualty which
has not been fully repaired and the cost thereof fully paid.
 
3.1.44     Purchase Options.  Neither the Property, any part thereof nor any
interest therein is subject to any purchase options, rights of first refusal to
purchase, rights of first offer to purchase or other similar rights in favor of
any Person.
 
3.1.45    Use of Property.  The Property consists solely of an office building,
research and development facilities and related operations and is used for no
other purpose.
 
3.1.46     Fiscal Year.  Each fiscal year of Borrower commences on January 1.
 
3.1.47     Material Agreements.
 
(a)           Borrower has not entered into, and is not bound by, any Material
Agreement which continues in existence, except those previously disclosed in
writing to Lender.
 
(b)           Each of the Material Agreements is in full force and effect, there
are no monetary or other defaults by Borrower thereunder and, to the best
knowledge of Borrower, there are no monetary or other defaults thereunder by any
other party thereto.  None of Borrower or any other Person acting on Borrower’s
behalf has given or received any notice of default under any Material Agreement
that remains outstanding or in dispute.
 
(c)           Borrower has delivered true, correct and complete copies of the
Material Agreements (including all amendments and supplements thereto) to
Lender.
 
(d)           No Material Agreement has as a party an Affiliate of Borrower.
 
3.1.48    Other Obligations and Liabilities.  Borrower has no liabilities or
other obligations that arose or accrued prior to the date hereof that, either
individually or in the aggregate, could have a Material Adverse Effect that has
not been disclosed to Lender in writing prior to the Closing Date.  Borrower has
no known contingent liabilities.
 
3.1.49     Illegal Activity.  No portion of the Property has been or will be
purchased with proceeds of any illegal activity.
 
3.1.50     Underwriting Representations.  Borrower hereby represents that it:
 
(a)           has no judgments or liens of any nature against it except for tax
liens not yet due;
 
(b)           is not involved in any dispute with any taxing authority;
 
(c)           is not now, nor has ever been, a party to any lawsuit,
arbitration, summons, or legal proceeding that is still pending or that resulted
in a judgment against it or its assets or properties that has not been paid in
full;
 
60

--------------------------------------------------------------------------------

(d)           has obtained a current Phase I environmental site assessment (and,
if applicable, a current Phase II environmental assessment) (collectively, the
“ESA”) for the Property prepared consistent with ASTM Practice E 1527 and the
ESA has not identified any recognized environmental conditions that require
further investigation or remediation; and
 
(e)           each amendment and restatement of Borrower’s Organizational
Documents has been accomplished in accordance with, and was permitted by, the
relevant provisions of said documents prior to such amendment or restatement
from time to time.
 
3.1.51     Employees.  Borrower has no direct employees.
 
3.1.52    Acquisition Documents.  Borrower has delivered to Lender true, correct
and complete copies of (a) the agreement pursuant to which Borrower is acquiring
the Property on the date hereof (including all amendments and supplements
thereto) (collectively, the “Purchase and Sale Agreement”) and (b) the
settlement statement related to the sale of the Property to Borrower (the
“Settlement Statement”).  There is no agreement (other than the Purchase and
Sale Agreement) related to the sale of the Property to Borrower.  The Settlement
Statement sets forth all payments, credits, prorations and other considerations
related to the sale of the Property to Borrower.
 
Section 3.2.           Survival of Representations. The representations and
warranties set forth in Section 3.1 hereof shall survive for so long as any
amount remains payable to Lender under this Agreement or any of the other Loan
Documents.
 
IV.           BORROWER COVENANTS
 
Section 4.1.          Borrower Affirmative Covenants.
 
Borrower hereby covenants and agrees with Lender that:
 
61

--------------------------------------------------------------------------------

4.1.1       Existence; Compliance with Legal Requirements.  Each of Borrower and
Sole Member 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.  There shall never be committed by Borrower, and Borrower shall use
commercially reasonable efforts not to permit any other Person in occupancy of
or involved with the operation or use of the Property to commit, any act or
omission affording the federal government, any state or local government or any
other Governmental Authority the right of forfeiture against the Property or any
part thereof or any monies paid in performance of Borrower’s obligations under
any of the Loan Documents.  Borrower hereby covenants and agrees not to commit,
and to use commercially reasonable efforts not to permit or suffer to exist, any
act or omission affording such right of forfeiture.  Borrower shall at all times
maintain, preserve and protect all franchises and trade names and preserve all
of its assets and properties used or useful in the conduct of its business and
shall keep the Property in good working order and repair, and from time to time
make, or cause to be made, all reasonably necessary repairs, renewals,
replacements, betterments and improvements thereto, all as more fully provided
in the Security Instrument.  Borrower shall keep the Property insured at all
times by financially sound and reputable insurers, to such extent and against
such risks, and maintain liability and such other insurance, as is more fully
provided in this Agreement.  After prior notice to Lender, Borrower, at its sole
cost and expense, may contest by appropriate legal proceeding promptly initiated
and conducted in good faith and with due diligence, the validity of any Legal
Requirement, the applicability of any Legal Requirement to Borrower or the
Property or any alleged violation of any Legal Requirement; provided that (a) no
Default or Event of Default has occurred and remains outstanding; (b) Borrower
is permitted to do so under the provisions of any mortgage or deed of trust
superior in lien to the Security Instrument; (c) such proceeding shall be
permitted under and be conducted in accordance with the provisions of any
instrument to which Borrower or the Property is subject and shall not constitute
a default thereunder and such proceeding shall be conducted in accordance with
all applicable statutes, laws and ordinances; (d) neither the Property nor any
part thereof or interest therein will be in danger of being sold, forfeited,
terminated, canceled or lost; (e) Borrower shall promptly upon final
determination thereof comply with such Legal Requirement determined to be valid
or applicable or cure any violation of such Legal Requirement; (f) such
proceeding shall suspend the enforcement of the contested Legal Requirement
against Borrower or the Property; (g) Borrower shall furnish such cash or other
security as may be required in the proceeding, or as may be requested by Lender,
to ensure compliance with such Legal Requirement, together with all interest and
penalties payable in connection therewith; and (h) such contest by Borrower is
not in violation of the Leases.  Lender may apply any such security or part
thereof as necessary to cause compliance with such Legal Requirement at any time
when, in the reasonable judgment of Lender, the validity, applicability or
violation of such Legal Requirement is finally established or the Property (or
any 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 Security Instrument being primed by any related Lien.  Upon the final
resolution of any such contest in favor of Borrower determining that Borrower is
not in violation of the applicable Legal Requirement, Lender shall return any
remaining portion of such security to Borrower.
 
4.1.2       Taxes and Other Charges.  Borrower shall pay, or cause Tenant to
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. 
Borrower shall furnish to Lender receipts for the payment of the Taxes and the
Other Charges no later than ten (10) Business Days prior to the date the same
shall become delinquent.  Borrower shall not permit or suffer and shall promptly
cause to be paid and discharged any Lien or charge against the Property.  After
prior notice to Lender, Borrower, at its sole cost and 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 (a) no Default or Event of Default has
occurred and remains outstanding; (b) Borrower is permitted to do so under the
provisions of any mortgage or deed of trust superior in lien to the Security
Instrument; (c) 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 and such
proceeding shall be conducted in accordance with all applicable Legal
Requirements; (d) neither the Property nor any part thereof or interest therein
will be in danger of being sold, forfeited, terminated, canceled or lost; (e)
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; (f) such proceeding shall suspend
the collection of such contested Taxes or Other Charges from the Property; (g)
Borrower shall furnish such cash or other security as may be required in the
proceeding, or as may be requested by Lender, to ensure the payment of any such
Taxes or Other Charges, together with all interest and penalties thereon; and
(h) such contest by Borrower is not in violation of the Leases.  Lender may pay
over, assign or transfer any such security or part thereof to the claimant
entitled thereto at any time when, in the reasonable judgment of Lender, the
entitlement of such claimant is established or the Property (or any 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 Security
Instrument being primed by any related Lien.  Upon the final resolution of any
such contest in favor of Borrower, Lender shall return any remaining portion of
such security to Borrower.
 
62

--------------------------------------------------------------------------------

4.1.3       Litigation.  Borrower shall give prompt notice to Lender of any
litigation or governmental proceedings pending or threatened against the
Property, Borrower, Sole Member or Guarantor which, if adversely determined, is
reasonably likely to have a Material Adverse Effect.  Borrower shall 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 under any of the other Loan Documents and, in connection therewith,
permit Lender, at its election, to participate in any such proceedings.
 
4.1.4       Access to Property.  Borrower shall permit agents, representatives
and employees of Lender to inspect the Property or any part thereof at
reasonable hours upon reasonable advance notice, subject to rights of Tenants
under their Leases.
 
4.1.5       Further Assurances; Supplemental Mortgage Affidavits.  Borrower
shall, at Borrower’s sole cost and expense:
 
(a)           furnish to Lender all instruments, documents, boundary surveys,
footing or foundation surveys, certificates, plans and specifications,
appraisals, title and other insurance reports and agreements, and each and every
other document, certificate, agreement and instrument required to be furnished
by Borrower pursuant to the terms of the Loan Documents or which are reasonably
requested by Lender in connection therewith;
 
(b)           cure, or cause to be cured, any defects in the execution and
delivery by Borrower and Guarantor of the Loan Documents;
 
(c)           execute and deliver, or cause to be executed and delivered, all
such documents, instruments, certificates, assignments and other writings and
do, or cause to be done, such other acts necessary or desirable (i) to correct
any omissions in the Loan Documents, (ii) to evidence and more fully describe
the collateral at any time securing or intended to secure the Obligations, (iii)
to perfect, protect or preserve any Liens created under any of the Loan
Documents or (iv) to make any recordings, file any notices, or obtain any
consents, as may be necessary or appropriate in connection therewith; and
 
(d)           do and execute, or cause to be done and executed, all such further
lawful and reasonable acts, conveyances and assurances for the better and more
effective carrying out of the intents and purposes of this Agreement and the
other Loan Documents, as Lender shall reasonably require from time to time
(provided the foregoing does not materially increase Borrower’s obligations or
materially decrease its rights under the Loan Documents).
 
63

--------------------------------------------------------------------------------

4.1.6       Financial Reporting.
 
(a)           Acceptable Accounting Basis.  Borrower shall keep and maintain, or
shall cause to be kept and maintained, in accordance with the Acceptable
Accounting Basis and, if applicable, the requirements of Regulation AB, proper
and accurate books, records and accounts reflecting all of the financial affairs
of Borrower and all items of income and expense in connection with the operation
of the Property.  All financial statements delivered to Lender pursuant to this
Section 4.1.6 shall be prepared in accordance with the Acceptable Accounting
Basis and consistently applied and, if applicable, the requirements of
Regulation AB.
 
(b)           Monthly Reports.  Prior to a Securitization, and at the request of
Lender, Borrower shall furnish, or cause to be furnished, to Lender on or before
twenty (20) days after the end of each calendar month the following items,
accompanied by an Officer’s Certificate stating that such items are true,
correct and complete and fairly present the financial condition and results of
the operations of Borrower and the Property (subject to normal year-end
adjustments) as applicable:  (i) a rent roll for the subject month; (ii) monthly
and year-to-date operating statements prepared for such month, noting Gross
Income from Operations, Operating Expenses, Capital Expenditures, Net Operating
Income, Net Cash Flow and such other information necessary and sufficient to
fairly represent the financial position and results of operation of the Property
during such month, all in form satisfactory to Lender; and (iii) a calculation
reflecting the Debt Service Coverage Ratio as of the last day of such month for
such month and for the immediately preceding twelve (12) month period.  In
addition, such Officer’s Certificate shall also state the representations and
warranties of Borrower set forth in Section 3.1.24 are true and correct in all
material respects as of the date of such certificate and that there are no trade
payables and operational debt outstanding for more than sixty (60) days.
 
(c)           Quarterly Reports.  Borrower shall furnish, or cause to be
furnished, to Lender on or before sixty (60) days after the end of each calendar
quarter the following items, accompanied by an Officer’s Certificate stating
that such items are true, correct and complete and fairly present the financial
condition and results of the operations of Borrower and the Property (subject to
normal year-end adjustments) as applicable:  (i)  a rent roll for the subject
quarter; (ii) (A) a balance sheet for Borrower as of the last day of such
quarter prepared by a certified public accountant reasonably acceptable to
Lender (provided, however, for so long as the Ionis Lease is in full force and
effect and no Event of Default exists, such certified public accountant may be
an employee of Sponsor) and (B) quarterly and year-to-date operating statements
prepared by a certified public accountant reasonably acceptable to Lender
(provided, however, for so long as the Ionis Lease is in full force and effect
and no Event of Default exists, such certified public accountant may be an
employee of Sponsor) for such quarter, noting Gross Income from Operations,
Operating Expenses, Capital Expenditures, Net Operating Income, Net Cash Flow
and such other information necessary and sufficient to fairly represent the
financial position and results of operation of the Property during such quarter,
all in form satisfactory to Lender; and (iii) a calculation reflecting the Debt
Service Coverage Ratio as of the last day of such quarter for such quarter and
for the last four quarters.  In addition, such Officer’s Certificate shall also
state that the representations and warranties of Borrower set forth in Section
3.1.24 are true and correct in all material respects as of the date of such
certificate and that there are no trade payables and operational debt
outstanding for more than sixty (60) days.
 
64

--------------------------------------------------------------------------------

(d)           Annual Reports.  Borrower shall furnish, or cause to be furnished,
to Lender annually, within ninety (90) days following the end of each Fiscal
Year of Borrower, a complete copy of Borrower’s annual financial statements
audited by a “Big Four” accounting firm or other independent certified public
accountant reasonably acceptable to Lender in accordance with the Acceptable
Accounting Basis and, if applicable, the requirements of Regulation AB covering
the Property for such Fiscal Year and containing statements of profit and loss
for Borrower and the Property and a balance sheet for Borrower.  Such statements
shall set forth the financial condition and the results of operations for the
Property for such Fiscal Year and shall include, but not be limited to, amounts
representing annual Gross Income from Operations, Operating Expenses, Capital
Expenditures, Net Operating Income and Net Cash Flow.  Borrower’s annual
financial statements shall be accompanied by (i) an Officer’s Certificate
stating that each such annual financial statement presents fairly the financial
condition and the results of operations of Borrower and the Property being
reported upon and has been prepared in accordance with the Acceptable Accounting
Basis and, if required, the requirements of Regulation AB, (ii) an unqualified
opinion of a “Big Four” accounting firm or other independent certified public
accountant reasonably acceptable to Lender, (iii) a rent roll for the subject
Fiscal Year, (iv) unless shown on the rent roll delivered to Lender pursuant to
clause (iii) above, a list of tenants, if any, occupying more than ten percent
(10%) of the total floor area of the Improvements, (v) unless shown on the rent
roll delivered to Lender pursuant to clause (iii) above, a breakdown showing the
year in which each Lease then in effect expires and the percentage of total
floor area of the Improvements and the percentage of base rent with respect to
which Leases shall expire in each such year, each such percentage to be
expressed on both a per year and cumulative basis, and  (vi) a schedule audited
by such accounting firm or independent certified public accountant reconciling
Net Operating Income to Net Cash Flow, which shall itemize all adjustments made
to Net Operating Income to arrive at Net Cash Flow deemed material by such
accounting firm or independent certified public accountant.  Notwithstanding the
immediately preceding sentence, for so long as the Ionis Lease is in full force
and effect and no Event of Default exists, Borrower shall only be required to
furnish, or cause to be furnished, to Lender annually, within ninety (90) days
following the end of each Fiscal Year of Borrower, a complete copy of Borrower’s
annual financial statements prepared by a certified public accountant acceptable
to Lender (it being understood that such certified public accountant may be an
employee of Sponsor) in accordance with the Acceptable Accounting Basis and, if
applicable, the requirements of Regulation AB covering the Property for such
Fiscal Year and containing statements of profit and loss for Borrower and the
Property and a balance sheet for Borrower.  Such statements shall set forth the
financial condition and the results of operations for the Property for such
Fiscal Year and shall include, but not be limited to, amounts representing
annual Gross Income from Operations, Operating Expenses, Capital Expenditures,
Net Operating Income and Net Cash Flow.  Borrower’s annual financial statements
shall be accompanied by (i) an Officer’s Certificate stating that each such
annual financial statement presents fairly the financial condition and the
results of operations of Borrower and the Property being reported upon and has
been prepared in accordance with the Acceptable Accounting Basis and, if
required, the requirements of Regulation AB, (ii) intentionally omitted, (iii) a
rent roll for the subject Fiscal Year, (iv) unless shown on the rent roll
delivered to Lender pursuant to clause (iii) above, a list of tenants, if any,
occupying more than ten percent (10%) of the total floor area of the
Improvements, (v) unless shown on the rent roll delivered to Lender pursuant to
clause (iii) above, a breakdown showing the year in which each Lease then in
effect expires and the percentage of total floor area of the Improvements and
the percentage of base rent with respect to which Leases shall expire in each
such year, each such percentage to be expressed on both a per year and
cumulative basis, and (vi) a schedule prepared by the applicable certified
public accountant or certified public accounting firm reconciling Net Operating
Income to Net Cash Flow, which shall itemize all adjustments made to Net
Operating Income to arrive at Net Cash Flow deemed material by such certified
public accountant or accounting firm.
 
65

--------------------------------------------------------------------------------

(e)           Certification; Supporting Documentation.  Each such financial
statement shall be in scope and detail satisfactory to Lender and certified by
the chief financial officer or representative of Borrower.
 
(f)            Access.  Lender shall have the right from time to time, upon
prior notice unless an Event of Default has occurred and is continuing, during
normal business hours to examine such books, records and accounts at the office
of Borrower or other Person maintaining such books, records and accounts and to
make such copies or extracts thereof as Lender shall desire.  During the
continuation of an Event of Default, Borrower shall pay any costs and expenses
incurred by Lender to examine Borrower’s accounting records with respect to the
Property, as Lender shall determine to be necessary or appropriate in the
protection of Lender’s interest.
 
(g)           Format of Delivery.  Any reports, statements or other information
required to be delivered under this Agreement shall be delivered (i) in
electronic form such as PDF via e-mail, if acceptable to Lender and Servicer (it
is being understood and agreed that such format is acceptable to UBS AG), (ii)
if requested by Lender, in paper form, and (iii) if requested by Lender, on a
diskette, compact disk or another portable memory storage device.
 
66

--------------------------------------------------------------------------------

(h)           Annual Budget.  For the partial year period commencing on the date
hereof, and for each Fiscal Year thereafter, Borrower shall submit to Lender an
Annual Budget not later than thirty (30) days prior to the commencement of such
period or Fiscal Year, which Annual Budget shall set forth, on a month-by-month
basis, in reasonable detail, each line item of Borrower’s good faith estimate of
Gross Income from Operations, Operating Expenses and Capital Expenditures (it is
being acknowledged and agreed that, for so long as (x) the Ionis Lease Condition
is satisfied, and (ii) Borrower does not intend to perform any Capital
Expenditures, such estimate may omit Capital Expenditures) for such period or
Fiscal Year and shall otherwise be in form reasonably satisfactory to Lender,
which budget shall be subject to Lender's prior written approval (not be
unreasonably withheld or delayed) (upon Lender's approval, an “Approved Annual
Budget”).  In the event that Lender objects to a proposed Annual Budget
submitted by Borrower for Lender's approval, 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 Section 4.1.6(h) until
Lender approves the Annual Budget.  Until such time that Lender approves a
proposed Annual Budget, the most recent Approved Annual Budget shall apply;
provided that, such Approved Annual Budget shall be adjusted to reflect actual
increases in Taxes, Insurance Premiums, Other Charges and utility expenses.  In
the event that Borrower must incur an extraordinary operating expense or capital
expense not set forth in the applicable Approved Annual Budget (each, an
“Extraordinary Expense”), then Borrower shall promptly deliver to Lender a
reasonably detailed explanation of such proposed Extraordinary Expense for
Lender’s approval, which approval shall not be unreasonably withheld or
delayed.  Notwithstanding anything to the contrary contained in this Section
4.1.6(h), to the extent that Lender's approval is required in connection with
any proposed Annual Budget (including any proposed revised Annual Budget)
submitted by Borrower, Lender's approval shall be deemed to have been given;
provided that (A)(1) Borrower's initial request for approval is submitted with
the notation “FIRST NOTICE.  FAILURE TO RESPOND TO THIS REQUEST FOR APPROVAL
WITHIN FIFTEEN (15) DAYS AFTER LENDER’S RECEIPT MAY RESULT IN THE REQUEST BEING
DEEMED APPROVED BY LENDER” prominently displayed in bold, all caps and fourteen
(14) point or larger font and is accompanied by the applicable proposed Annual
Budget and such other documents and information as Borrower believes in good
faith are reasonably required for Lender to adequately evaluate such request and
(2) Lender fails to approve or object to the proposed Annual Budget, or request
additional documents and information reasonably required for Lender to
adequately evaluate such request, within fifteen (15) days after Lender’s
receipt of the first request for approval, and (B)(1) Borrowers submits a second
request for approval with the notation “SECOND AND FINAL NOTICE.  IMMEDIATE
RESPONSE REQUIRED.  FAILURE TO RESPOND TO THIS REQUEST FOR APPROVAL WITHIN TEN
(10) DAYS AFTER LENDER’S RECEIPT SHALL CONSTITUTE DEEMED APPROVAL BY LENDER”
prominently displayed in bold, all caps and fourteen (14) point or larger font
and such request for approval is accompanied by the applicable proposed Annual
Budget and such other documents and information as Borrower believes in good
faith are reasonably required for Lender to adequately evaluate such request and
(2) Lender fails to approve or object to the proposed Annual Budget, or request
additional documents and information reasonably required for Lender to
adequately evaluate such request, within ten (10) days after Lender’s receipt of
the second request for approval.
 
67

--------------------------------------------------------------------------------

(i)            Additional Information.  Borrower shall submit to Lender the
financial data and financial statements required, and within the time periods
required, under Sections 9.1(d), (e) and (f), if and when applicable.
 
(j)            Other Required Information.  Borrower shall furnish to Lender,
within five (5) Business Days after request (or as soon thereafter as may be
reasonably possible), such further detailed information with respect to the
operation of the Property and the financial affairs of Borrower as may be
reasonably requested by Lender (including, without limitation, a comparison of
the budgeted income and expenses as set forth in the applicable Approved Annual
Budget and the actual income and expenses for the applicable month (if required
in connection with a Securitization), quarter or year and year-to-date for the
Property, together with a detailed explanation of any variances of more than
five percent (5%) between budgeted and actual amounts for such periods).
 
(k)           Reporting Default.  If Borrower fails to provide to Lender the
financial statements and other information specified in this Section 4.1.6
(except for subclause (j), unless such information is required to comply with
Regulation AB) within the respective time period specified, then such failure
shall constitute an Event of Default if it continues for ten (10) days after
notice to Borrower from Lender.
 
68

--------------------------------------------------------------------------------

4.1.7       Title to Property.  Borrower shall warrant and defend (a) its title
to the Property, subject only to Permitted Encumbrances, and (b) the validity
and priority of the Liens of the Security Instrument and the Assignment of
Leases on the Property, subject only to Permitted Encumbrances, in each case
against the claims of all Persons whomsoever.  Borrower shall reimburse Lender
for any losses, costs, damages or expenses (including reasonable attorneys’ fees
and court costs) incurred by Lender if an interest in the Property or any part
thereof is claimed by any other Person except as expressly permitted hereunder.
 
4.1.8       Estoppel Statement.
 
(a)           Borrower shall deliver to Lender, within ten (10) Business Days
after Lender’s written request, a statement, duly acknowledged and certified,
setting forth (i) the original principal amount of the Loan, (ii) the unpaid
principal amount of the Loan, (iii) the interest rate of the Loan, (iv) the date
installments of principal and/or interest were last paid, (v) any offsets or
defenses to the payment and performance of the Obligations, if any, and (vi)
that this Agreement and the other Loan Documents are valid, legal and binding
obligations of Borrower and have not been modified (or, if modified, giving
particulars of such modification).
 
(b)           Borrower shall deliver to Lender, within thirty (30) days after
Lender’s request, an estoppel certificate from each Tenant under any Lease in
form and substance reasonably satisfactory to Lender; provided that (i) Borrower
shall only be required to use commercially reasonable efforts to obtain an
estoppel certificate from any Tenant, (ii) such estoppel certificate may be in
the form required under such Lease, and (iii) after the final Securitization of
the Loan, Borrower shall not be required to deliver such estoppel certificate
from any Tenant more frequently than two (2) times in any calendar year.
 
(c)           Borrower shall use commercially reasonable deliver to Lender,
within forty-five (45) days after Lender’s request, an estoppel certificate from
each party under the REA in form and substance reasonably satisfactory to
Lender; provided that (i) Borrower shall only be required to use commercially
reasonable efforts to obtain such estoppel certificate and (ii) such estoppel
certificate may be in the form required under the REA.
 
4.1.9       Leases.
 
(a)           All Leases and all renewals of Leases executed after the date
hereof shall (i) provide for economic terms, including rental rates, comparable
to existing local market rates for similar properties, (ii) be on commercially
reasonable terms, (iii) have a term of not less than five (5) years (unless
Lender approves in writing a shorter term), (iv) have a term of not more than
fifteen (15) years, including all extensions and renewals (unless Lender
approves in writing a longer term), (v) provide that such Lease is subordinate
to the Security Instrument and the Assignment of Leases and that the Tenant
thereunder will attorn to Lender and any purchaser at a foreclosure sale, (vi)
be with Tenants that are creditworthy as determined by Borrower in the exercise
of prudent property management practices, (vii) be written substantially in
accordance with a standard form of Lease which shall have been approved in
writing by Lender (subject to any commercially reasonable changes made in the
course of negotiations with the applicable Tenant), (viii) other than the Ionis
Lease, not be with any Affiliate of Borrower, Guarantor or Manager, and (ix) not
contain any option to purchase, any right of first option to purchase, any right
of first refusal to purchase, any right to terminate (except in the event of
destruction or condemnation of all or substantially all of the Property, any
requirement for a non-disturbance or recognition agreement (other than on the
standard form previously approved by Lender), or any other terms which are
reasonably likely to materially adversely affect Lender’s rights under the Loan
Documents; provided that, in connection with extensions or renewals of Leases
existing on the date hereof, any applicable term that would otherwise breach the
requirements set forth in this Section 4.1.9(a) shall be permitted to the extent
necessary to implement an extension or renewal term expressly contained in the
applicable Lease and with respect to which Borrower has no discretion. Any
non‑compliance with the foregoing requirements shall require Lender’s prior
written approval, which shall not be unreasonably withheld or delayed.
 
69

--------------------------------------------------------------------------------

(b)           Borrower (i) shall perform the obligations which Borrower is
required to perform under the Leases; (ii) shall enforce in a commercially
reasonable manner the obligations to be performed by the Tenants thereunder;
(iii) shall promptly furnish to Lender any notice of default or termination
received by Borrower from any Tenant, and any notice of default or termination
given by Borrower to any Tenant; (iv) shall not collect any Rents for more than
one (1) month in advance of the time when the same shall become due, except for
bona fide security deposits not in excess of an amount equal to two (2) months’
rent; (v) shall not enter into any ground lease or master lease of any part of
the Property; (vi) shall not further assign or encumber any Lease or the Rents
(except as contemplated by the Loan Documents); (vii) shall not cancel or
terminate, or accept the surrender or termination of, any Lease (except (A) with
Lender’s prior written approval, (B) in the case of any Lease that is not a
Major Lease, if (1) no Event of Default has occurred and is continuing, or (2) a
material event of default by the Tenant under such Lease has occurred and is
continuing and (3) such cancellation or termination is consistent with prudent
property management practices); and (viii) shall not modify or amend any Lease
(except (A) with Lender’s prior written approval or (B) in the case of any Lease
that is not a Major Lease, if (1) no Event of Default has occurred and is
continuing, (2) such modification or amendment is not material and does not
affect the economic terms of the applicable Lease, and (3) such modification or
amendment is entered into in the ordinary course of business and is consistent
with prudent property management practices).  Any action in violation of clause
(v), (vi), (vii) or (viii) of this Section 4.1.9(b) shall be void at the
election of Lender.
 
(c)           All Major Leases and all renewals, modifications and amendments
thereof  executed after the date hereof shall be subject to Lender’s prior
approval, which approval shall not be unreasonably withheld so long as the
applicable Tenant is not an Affiliate of Borrower.
 
(d)           [Reserved.]
 
(e)          Borrower shall not permit or consent to any assignment or sublease
of any Major Lease without Lender’s prior approval, which approval shall not be
unreasonably withheld, conditioned or delayed; notwithstanding the foregoing, it
is acknowledged and agreed that Lender’s consent shall not be required for an
Ionis Sublease, provided each of the following conditions is satisfied: (i) no
Event of Default has occurred and is continuing, (ii) the Ionis Lease Condition
is satisfied, (iii) Ionis continues to remain liable for all obligations and
liabilities of tenant under the Ionis Lease, including, without limitation, any
obligations and liabilities of subtenant under the Ionis Sublease (i.e., Ionis
is not releaased from any liability under the Ionis Lease as a result of such
Ionis Sublease), (iv) such Ionis Sublease, either individually or when taken
together with any other Ionis Subleases then in effect, and assuming the
exercise of all expansion rights and preferential rights to lease additional
space contained in such Ionis Sublease or Ionis Subleases, as applicable, covers
twenty-five percent (25%) or less of the total rentable square footage at the
Property, and (v) Borrower shall give (or shall cause Ionis to give) to Lender
written notice of such proposed Ionis Sublease, together with a copy of such
proposed Ionis Sublease, not less than thirty (30) days prior to the effective
date of such Ionis Sublease, and provide a true, correct and complete copy of
the fully executed Ionis Sublease within five (5) Business Days of the execution
thereof.
 
70

--------------------------------------------------------------------------------

(f)            [Reserved.]
 
(g)           Borrower agrees to bear and shall pay or reimburse Lender on
demand for all reasonable costs and expenses (including, without limitation,
reasonable attorneys’ fees and expenses) incurred by Lender in connection with
the review of any proposed Lease, any other matter requiring Lender’s consent or
approval under this Section 4.1.9 or execution and delivery of any
subordination, non-disturbance and attornment agreement in accordance with this
Section 4.1.9.
 
(h)           Within ten (10) days after Lender’s request, Borrower shall
furnish to Lender (i) a statement of all tenant security or other deposits and
(ii) copies of all Leases not previously delivered to Lender, in each case,
certified as being true, correct and complete.
 
(i)            All security deposits of Tenants, whether held in cash or any
other form, shall be held in compliance with all applicable Legal Requirements,
shall not be commingled with any other funds of Borrower and, if cash, shall be
deposited by Borrower in a separately designated account under Borrower’s
control at Clearing Bank.  After the occurrence of an Event of Default, upon
Lender's request, Borrower shall, if permitted by the applicable Legal
Requirements, cause all such security deposits (and any interest thereon) to be
transferred to Lender to be held by Lender in a separate Eligible Account
subject to the terms of the Leases.  Any bond or other instrument which Borrower
is permitted to hold in lieu of cash security deposits under the applicable
Legal Requirements (i) shall be maintained in full force and effect in the full
amount of such deposits unless replaced by cash deposits as described above,
(ii) shall be issued by an institution reasonably satisfactory to Lender, (iii)
shall, if permitted by the applicable Legal Requirements, name Lender as payee
or mortgagee thereunder (or, at Lender’s option, be fully assignable to Lender),
and (iv) shall in all respects comply with the applicable Legal Requirements and
otherwise be satisfactory to Lender.  Borrower shall, upon request, provide
Lender with evidence satisfactory to Lender of Borrower’s compliance with the
foregoing.
 
71

--------------------------------------------------------------------------------

4.1.10     Alterations.  Lender’s prior approval shall be required in connection
with any alterations to the Property (a)(i) that is reasonably likely to have a
Material Adverse Effect, (ii) the cost of which (including any related
alteration, improvement or replacement) is reasonably anticipated to exceed the
Alteration Threshold, or (iii) that could adversely affect any structural
component of any Improvements, any utility or HVAC system at the Property or the
exterior of any building constituting a part of any Improvements or (b) any
alterations to the Property during the continuation of any Event of Default,
which approval, in each case under clause (a) or (b), may be granted or withheld
in Lender’s sole discretion.  Any alteration to the Property shall be done and
completed by Borrower in an expeditious and diligent fashion and in compliance
with all applicable Legal Requirements.  If the total unpaid amounts incurred
and to be incurred with respect to such alterations to the Property shall at any
time exceed the Alteration Threshold, Borrower shall promptly deliver to Lender
as security for the payment of such amounts and as additional security for
Borrower’s obligations under the Loan Documents any of the following:  (A) cash,
(B) Letters of Credit, (C) U.S. Obligations or (D) other securities acceptable
to Lender, provided that, with respect to clause (D), Lender shall have received
a Rating Agency Confirmation as to the form and issuer of same.  Such security
shall be in an amount equal to the excess of the total unpaid amounts incurred
and to be incurred with respect to such alterations to the Improvements (other
than such amounts to be paid or reimbursed by Tenants under the Leases; provided
that the applicable Leases shall be in full force and effect) over the
Alteration Threshold, and, at Lender’s option, Lender shall have the right to
apply such security from time to time to pay for such alterations if not
otherwise paid by Borrower prior to the date such amounts are due.  Upon
substantial completion of any alteration to the Property, Borrower shall provide
(or cause Tenant to provide) evidence reasonably satisfactory to Lender that (1)
such alteration was constructed in accordance with all applicable Legal
Requirements, (2) all contractors, subcontractors, materialmen and professionals
who provided work, materials or services in connection with such alteration have
been paid in full and have delivered unconditional releases of liens, and (3)
all licenses and permits necessary for the use, operation and occupancy of the
Improvements have been issued, provided that, if any such license or permit is
temporary in nature, Borrower shall diligently pursue procuring a permanent
license or permit from the applicable Governmental Authority.  Notwithstanding
anything to the contrary contained in this Agreement, Lender’s consent shall not
be required in connection with the Existing Project, provided that each of the
following conditions is satisfied and remains satisfied at all times until
completion of the Existing Project: (i) no Event of Default has occurred and is
continuing, (ii) the Ionis Lease Condition is satisfied, (iii) Ionis is solely
responsible for the payment for, and performance and completion of the Existing
Project, (iv) Borrower provides to Lender written evidence reasonably acceptable
to Lender in all respects that the Existing Project complies with all applicable
Legal Requirements of all Governmental Authorities having jurisdiction over the
Property and all applicable insurance requirements (including, without
limitation, applicable building codes, special use permits, environmental
regulations, and requirements of insurance underwriters) and any other
restrictions encumbering the Property, including, without limitation, the REAs
(to the extent any such approvals are required pursuant to the terms of any
REA), (v) all approvals, authorizations, certifications, licenses and permits,
including, without limitation, certificates of completion and occupancy,
required by any Governmental Authority or otherwise necessary for the use,
occupancy and operation of the Property (including any new improvements) in the
manner in which the Property was being used, occupied and operated prior to
commencement of the Existing Project have been obtained by Ionis and/or Borrower
and are in full force and effect (to the extent any of the foregoing are
required by any Governmental Authorities having jurisdiction over the Property,
Borrower or Tenant), (vi) the Existing Project is being completed in a good and
workmanlike manner on a lien free basis in accordance with the terms and
conditions of the Ionis Lease and this Agreement, (vii) at Lender’s request,
Borrower shall deliver lien waivers or conditioned lien waivers with respect to
all work that has been completed, (viii) upon completion of the applicable
Existing Project (and to the extent any new building or structure is constructed
as part of such Existing Project, and such new building or structure is not
depicted on the Survey delivered to Lender in connection with the closing of the
Loan), Borrower shall deliver to Lender an updated Survey reasonably acceptable
to Lender in all respects, (ix) upon completion of the applicable Existing
Project (and to the extent required pursuant to the applicable Legal
Requirements), Borrower shall deliver a new or updated certificate of occupancy
with respect to the Property, (x) upon completion of the Existing Project,
Lender receives an endorsement to the Title Insurance Policy insuring the
continued priority of the Lien of the Security Instrument and evidence of
payment of any premium payable in connection with such endorsement, and (xi)
Ionis maintains (x) a Net Worth of not less than $51,350,000.00 plus the
estimated cost of the Existing Project (excluding Guarantor’s interest in the
Property) and (y) Liquid Assets of not less than $5,135,000.00 plus the
estimated cost of the Existing Project.
 
72

--------------------------------------------------------------------------------

4.1.11     Existing Project.
 
(a)           Borrower shall cause Ionis to complete the Existing Project in a
good and workmanlike manner and on a lien-free basis.
 
(b)           The Existing Project and all materials, equipment, fixtures, or
any other item comprising a part of the Existing Project shall be constructed,
installed or completed, as applicable, free and clear of all liens, claims and
other encumbrances not previously approved by Lender.
 
(c)           The Existing Project shall comply with all applicable Legal
Requirements of all Governmental Authorities having jurisdiction over the
Property and all applicable insurance requirements (including, without
limitation, applicable building codes, special use permits, environmental
regulations, and requirements of insurance underwriters) and any other
restrictions encumbering the Property, including, without limitation, the REAs.
 
(d)           In addition to any insurance required under the Loan Documents,
Borrower shall provide or cause Ionis to provide builder’s risk insurance,
workers’ compensation insurance, public liability insurance and other insurance
to the extent required by the applicable Legal Requirements in connection with
any portion of the Existing Project.  All such policies shall be in form and
amount reasonably satisfactory to Lender.  All such policies which can be
endorsed with a non-contributing mortgagee clause (or its equivalent) making
loss thereunder payable to Lender and its successors and/or assigns shall be so
endorsed.  At Lender’s written request, certified copies of such policies shall
be delivered to Lender.
 
(e)           Borrower shall provide (or cause Ionis to provide) to Lender
copies of such contracts, plans, specifications, budgets, surveys and other
information and/or documents with respect to the Existing Project as Lender may
reasonably request.
 
(f)            [Reserved].
 
(g)           All of the Existing Projects shall be completed prior to the date
that is at least six (6) months prior to the Stated Maturity Date.
 
(h)           Borrower provides (or causes Ionis to provide) to Lender written
evidence reasonably acceptable to Lender in all respects that the Existing
Project complies with all applicable requirements set forth in the REA, and all
approvals required pursuant to the terms of any REA have been obtained by
Borrower or Ionis, as applicable (to the extent any such approvals are required
pursuant to the terms of any REA).
 
73

--------------------------------------------------------------------------------

(i)            Upon completion of the Existing Project, Borrower provides to
Lender written evidence reasonably acceptable to Lender in all respects that the
Property continues to comply with all applicable Legal Requirements of all
Governmental Authorities having jurisdiction over the Property and all
applicable insurance requirements (including, without limitation, applicable
building codes, special use permits, environmental regulations, and requirements
of insurance underwriters) and any other restrictions encumbering the Property,
including, without limitation, the REAs.
 
(j)            Upon completion of the applicable Existing Project (and to the
extent any new building or structure is constructed as part of such Existing
Project), Borrower shall deliver to Lender an updated Survey reasonably
acceptable to Lender in all respects.
 
(k)           Upon completion of the applicable Existing Project (and to the
extent required pursuant to the applicable Legal Requirements), Borrower shall
deliver a new or updated certificate of occupancy with respect to the Property.
 
(l)            Upon completion of the Existing Project, Borrower shall deliver
an endorsement to the Title Insurance Policy insuring the continued priority of
the Lien of the Security Instrument and evidence of payment of any premium
payable in connection with such endorsement.
 
(m)          Upon completion of the Existing Project, Borrower shall deliver to
Lender notice of such completion of the applicable Existing Project, together
with an Officer’s Certificate certifying that all of the requirements of this
Section 4.1.11 have been satisfied.
 
4.1.12     Material Agreements.  Borrower shall (a) promptly perform and/or
observe the covenants, agreements and conditions required to be performed and
observed by it under each Material Agreement and Operating Agreement to which it
is a party, and do all things necessary to preserve and to keep unimpaired its
rights thereunder, (b) promptly notify Lender in writing of the giving of any
notice of any default by any party under any Material Agreement and Operating
Agreement of which it is aware, (c) promptly deliver to Lender copies of all
material notices, summonses, pleadings, applications and other documents
received in connection with any Material Agreement or Operating Agreement, and
(d) promptly enforce the performance and observance in all material respects of
all of the covenants, agreements and conditions required to be performed and/or
observed by any other party under each Material Agreement and Operating
Agreement to which Borrower is a party in a commercially reasonable manner.
 
4.1.13     Performance by Borrower.  Borrower shall, in a timely manner,
observe, perform and fulfill each and every covenant, term and provision of each
Loan Document executed and delivered by Borrower, and shall not enter into or
otherwise suffer or permit any amendment, waiver, supplement, termination or
other modification of any Loan Document executed and delivered by Borrower
without the prior consent of Lender.
 
74

--------------------------------------------------------------------------------

4.1.14     Costs of Enforcement/Remedying Defaults.  In the event (a) that the
Security Instrument is foreclosed in whole or in part or the Note or any other
Loan Document is put into the hands of an attorney for collection, suit, action
or foreclosure, (b) of the foreclosure of any Lien or mortgage, whether senior
or junior to the Security Instrument, in which proceeding Lender is made a
party, (c) of the bankruptcy, insolvency, rehabilitation or other similar
proceeding in respect of Borrower or Guarantor or an assignment by Borrower or
Guarantor for the benefit of its creditors, or (d) Lender shall remedy or
attempt to remedy any Event of Default, Borrower shall be chargeable with and
agrees to pay all reasonable out-of-pocket costs and expenses incurred by Lender
as a result thereof, including costs of collection and defense (including
reasonable attorneys’, experts’, consultants’ and witnesses’ fees and
disbursements) in connection therewith and in connection with any appellate
proceeding or post-judgment action, which shall be due and payable on demand,
together with interest at the Default Rate from the date such costs and expenses
were incurred to and including the date the reimbursement payment is received by
Lender.  All such indebtedness shall be secured by the Security Instrument.
 
4.1.15     Business and Operations.  Borrower will continue to engage in the
businesses currently conducted by it as and to the extent the same are necessary
for the ownership, management and operation of the Property.  Borrower will
qualify to do business and will remain in good standing under the laws of each
jurisdiction as and to the extent the same are required for the ownership,
management and operation of the Property.  Borrower shall at all times cause the
Property to be maintained as an office building and research and development
facilities as currently used (or reasonably related thereto).
 
4.1.16     Landlord Consent Under Ionis Lease.  Borrower acknowledges and agrees
that, to the extent the terms of the Ionis Lease expressly require the approval
or consent by Borrower with respect to any related matter, then Borrower shall
be required to obtain Lender’s prior written consent prior to the granting,
withholding or waiving such approval or consent.
 
4.1.17     Intentionally Omitted.
 
4.1.18     Handicapped Access.
 
(a)           Borrower covenants and agrees that the Property shall at all times
strictly comply to the extent applicable with the requirements of the Americans
with Disabilities Act of 1990, the Fair Housing Amendments Act of 1988, all
federal, state and local laws and ordinances related to handicapped access and
all rules, regulations, and orders issued pursuant thereto including, without
limitation, the Americans with Disabilities Act Accessibility Guidelines for
Buildings and Facilities (collectively, the “Access Laws”).
 
(b)           Notwithstanding anything to the contrary set forth herein or in
any other Loan Document, Borrower shall not alter or cause or permit to be
altered the Property in any manner which would materially increase Borrower’s
responsibilities for compliance with any Access Laws without the prior approval
of Lender (provided, however, that such approval shall not be required for so
long as the Ionis Lease Condition remains satisfied and no Event of Default has
occurred and is continuing).  The foregoing shall apply to tenant improvements
constructed by Borrower or by any Tenant.  Lender may condition any such
approval upon receipt of a certificate of compliance with the Access Laws from
an architect, engineer, or other Person acceptable to Lender.
 
75

--------------------------------------------------------------------------------

(c)           Borrower covenants and agrees to give prompt notice to Lender of
the receipt by Borrower of any complaints related to the violation of any Access
Laws and of the commencement of any proceedings or investigations which relate
to compliance with any Access Laws.
 
4.1.19     Additional Reports.  Borrower shall deliver to Lender as soon as
reasonably available, but in no event later than thirty (30) days after such
items become available to Borrower in final form, copies of any final
engineering, environmental or seismic reports prepared for Borrower with respect
to the Property.
 
4.1.20     Notice of Certain Events.  Borrower shall promptly notify Lender of
(a) any Default or Event of Default, together with a detailed statement of the
steps being taken to cure such Default or Event of Default; (b) any notice of
default received by Borrower under any agreement, document or instrument to
which Borrower is a party or to which Borrower or the Property is subject, which
is reasonably likely to have a Material Adverse Effect; (c) any notice of
default received by Borrower under any other obligations relating to the
Property or otherwise material to Borrower’s business; and (d) any pending or
threatened in writing legal, judicial, administrative or regulatory proceedings,
including any disputes between Borrower and any Governmental Authority,
affecting Borrower or the Property.
 
4.1.21     Further Assurances; Power of Attorney.  Borrower irrevocably appoints
Lender as its true and lawful attorney-in-fact to do, in its name or otherwise,
any and all acts and to execute any and all documents that are necessary for the
purpose of exercising, perfecting or preserving any and all rights and remedies
available to Lender under the Loan Documents, at law and in equity, including,
without limitation, such rights and remedies available to Lender pursuant to
Section 10.2, Section 10.3, and Section 10.4 hereof (and the above powers
granted to Lender are coupled with an interest and shall be irrevocable).
 
4.1.22     Taxes on Security.  Borrower shall pay all taxes, charges, filing,
registration and recording fees, excises and levies payable with respect to the
Note or the Liens created or secured by the Loan Documents, other than income,
franchise and doing business taxes imposed on Lender.  If there shall be enacted
any law (a) deducting the Loan from the value of the Property for the purpose of
taxation, (b) affecting any Lien on the Property, or (c) changing existing laws
of taxation of mortgages, deeds of trust, security deeds, or debts secured by
real property, or changing the manner of collecting any such taxes, Borrower
shall promptly pay to Lender, on demand, all taxes, costs and charges for which
Lender is or may be liable as a result thereof; provided, however, that if such
payment would be prohibited by law or would render the Loan usurious, then
instead of collecting such payment, Lender may declare all amounts owing under
the Loan Documents to be immediately due and payable without any prepayment
premium or penalty.
 
4.1.23     Intentionally Omitted.
 
76

--------------------------------------------------------------------------------

4.1.24     REA.  The Borrower hereby covenants and agrees with Lender with
respect to the REA as follows:
 
(a)            Borrower shall pay all charges and other sums to be paid by
Borrower pursuant to the terms of the REA as the same shall become due and
payable and prior to the expiration of any applicable grace period therein
provided.  After prior notice to Lender, Borrower, at its own cost and 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 charges required to be paid by Borrower pursuant to the
REA; provided that (i) no Default or Event of Default has occurred and remains
outstanding; (ii) Borrower is permitted to do so under the provisions of any
mortgage or deed of trust superior in lien to the Security Instrument; (iii)
such proceeding shall be permitted under and be conducted in accordance with the
provisions of the REA and any other instrument to which Borrower is subject or
by which the Property is bound and shall not constitute a default thereunder and
such proceeding shall be conducted in accordance with all applicable Legal
Requirements; (iv) neither the Property nor any part thereof or interest therein
will be in danger of being sold, forfeited, terminated, cancelled or lost; (v)
the REA will not be in danger of being terminated; (vi) Borrower shall promptly
upon final determination thereof pay the amount of any such charges, together
with all interest and penalties which may be payable in connection therewith;
(vii) such proceeding shall suspend the collection of such charges from Borrower
and the Property; (viii) Borrower shall furnish such cash or other security as
may be required in the proceeding or as may be required by Lender to ensure the
payment of any such charges, together with all interest and penalties thereon;
and (ix) such contest by Borrower is not in violation of the Leases.  Lender may
pay over, assign or transfer any such security or part thereof to the claimant
entitled thereto at any time when, in the reasonable judgment of Lender, the
entitlement of such claimant is established or the Property (or any 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 Security
Instrument being primed by any related Lien.
 
(b)           Borrower shall perform and observe (or cause Tenant to perform and
observe) all of the terms, covenants and conditions required to be performed and
observed by Borrower pursuant to the terms of the REA.
 
(c)            Borrower shall take all actions as may be necessary from time to
time to preserve and maintain the REA in accordance with all applicable Legal
Requirements.
 
(d)           Borrower shall enforce, in a commercially reasonably manner and in
all material respects, the terms, covenants and conditions to be performed and
observed by the parties to the REA (other than Borrower).
 
(e)           Borrower shall promptly furnish to Lender any written notice of
default or other communication delivered in connection with the REA by any party
to the REA or any third‑party (other than routine correspondences and invoices).
 
(f)            If Lender or its nominee, designee, successor, or assignee
acquires title and/or rights of Borrower under the REA by reason of foreclosure
of the Security Instrument, deed‑in‑lieu of foreclosure or otherwise, Lender or
such other party shall (i) succeed to all of the rights of and benefits accruing
to Borrower under the REA, and (ii) be entitled to exercise all of the rights
and benefits accruing to Borrower under the REA.  At such time as Lender shall
request, Borrower agrees to execute and deliver to Lender such documents as
Lender and its counsel may require in order to ensure that the provisions of
this Section 4.1.24(f) will be validly and legally enforceable and effective
against Borrower and all parties claiming by, through, under or against
Borrower.
 
77

--------------------------------------------------------------------------------

4.1.25     Patriot Act Compliance.  Borrower will use its good faith and
commercially reasonable efforts to comply with the Patriot Act and all
applicable requirements of Governmental Authorities relating to terrorism and
money laundering.  Lender shall have the right to audit Borrower’s compliance
with the Patriot Act and all applicable requirements of Governmental Authorities
relating to terrorism and money laundering.  In the event that Borrower fails to
comply with the Patriot Act or any such requirements of Governmental
Authorities, Lender may, at its option, cause Borrower to comply therewith.  All
costs and expenses incurred by Lender in connection therewith shall be paid by
Borrower to Lender, upon demand, with interest at the Default Rate from the date
such costs and expenses were incurred to and including the date the
reimbursement payment is received by Lender.  All such indebtedness shall be
secured by the Security Instrument.
 
4.1.26     Prohibited Entity.  Borrower hereby represents and warrants to, and
covenants with, Lender that until such time as the Debt shall be paid in full,
no Prohibited Entity shall hold any direct and/or indirect ownership interest in
Borrower or the Property.
 
Section 4.2.           Borrower Negative Covenants.
 
Borrower covenants and agrees with Lender that:
 
4.2.1       Liens.  Borrower shall not create, incur, assume or suffer to exist
any Lien on any direct or indirect interest in Borrower or on any portion of the
Property except for Permitted Encumbrances.
 
4.2.2       Dissolution.  Borrower shall not (a) engage in any dissolution,
winding up, liquidation or consolidation or merger with or into any other
business entity, (b) engage in any business activity not related to the
ownership, management and operation of the Property, (c) amend, modify, waive or
terminate any Organizational Document or any provision thereof, (d) transfer,
lease or sell, in one transaction or any combination of transactions, all or
substantially all of the assets or properties of Borrower except to the extent
expressly permitted by the Loan Documents, or (e) cause, permit or suffer Sole
Member to dissolve, wind up or liquidate or take any action, or omit to take an
action, as a result of which Sole Member would be dissolved, wound up or
liquidated in whole or in part.
 
4.2.3       Change in Business.  Borrower shall not (a) enter into any line of
business other than the ownership, management and operation of the Property, (b)
make any material change in the scope or nature of its business objectives,
purposes or operations, or (c) undertake or participate in activities other than
the continuance of its present business.
 
4.2.4       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.
 
78

--------------------------------------------------------------------------------

4.2.5       Affiliate Transactions.  Borrower shall not enter into, or be a
party to, any transaction with any Affiliate of Borrower or any partner, member,
or shareholder, as applicable, of Borrower or any Affiliate of Borrower except
in the ordinary course of business and on terms and conditions that are fully
disclosed to Lender in advance and that are intrinsically fair, commercially
reasonable and substantially similar to those that would be available on an
arm’s-length basis with an unrelated third party.
 
4.2.6       Zoning.  Borrower shall not initiate or consent to any zoning
reclassification of any portion of the Property or seek any variance under any
existing zoning ordinance or 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, without the prior consent of Lender.
 
4.2.7       Assets.  Borrower shall not purchase or own any asset or property
other than the Property and any asset or property necessary for or incidental to
the operation of the Property.
 
4.2.8       No Joint Assessment.  Borrower shall not suffer, permit or initiate
the joint assessment of the Property (a) with any other real property
constituting a tax lot separate from the Property, and (b) with any portion of
the Property which may be deemed to constitute personal property, or any other
action or 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 or
any portion thereof.
 
4.2.9       Principal Place of Business.  Borrower shall not change its
principal place of business from the address set forth on the first page of this
Agreement without first giving Lender thirty (30) days’ prior notice.
 
4.2.10     ERISA.
 
(a)           Borrower shall not engage in any transaction which would cause any
obligation, or any action taken or to be taken, hereunder or under the other
Loan Documents (or the exercise by Lender of any of its rights under this
Agreement or the other Loan Documents) to be a non-exempt (under a statutory or
administrative class exemption) prohibited transaction under the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”).
 
(b)           Borrower shall deliver to Lender such certifications or other
evidence from time to time throughout the Term, as requested by Lender in its
sole discretion, that (i) Borrower is not 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(32) of ERISA; (ii) Borrower
is not subject to any state statute regulating investments of, or fiduciary
obligations with respect to, governmental plans; and (iii) one (1) or more of
the following circumstances is true:
 
79

--------------------------------------------------------------------------------

(A)         Equity interests in Borrower are publicly offered securities, within
the meaning of 29 C.F.R. §2510.3-101(b)(2);
 
(B)          Less than twenty-five percent (25%) of each outstanding class of
equity interests in Borrower is held by “benefit plan investors” within the
meaning of 29 C.F.R. §2510.3-101(f)(2); or
 
(C)          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).
 
4.2.11     Material Agreements.  Borrower shall not, without Lender’s prior
consent:  (a) enter into, surrender or terminate any Material Agreement or
Operating Agreement to which it is a party or to which Borrower or the Property
is subject (unless the other party thereto is in material default and the
termination of such agreement would be commercially reasonable), (b) increase or
consent to the increase of the amount of any charges under any Material
Agreement or Operating Agreement to which it is a party or to which Borrower or
the Property is subject, except as provided therein or on an arm’s-length basis
and commercially reasonable terms; or (c) otherwise modify, change, supplement,
alter or amend, or waive or release any of its rights and remedies under any
Material Agreement or Operating Agreement to which it is a party or to which
Borrower or the Property is subject in any material respect, except on an
arm’s-length basis and commercially reasonable terms.
 
4.2.12     Change of Name, Identity or Structure.  Borrower will not cause or
permit any change to be made to its name, identity (including its trade name or
names) or Borrower’s organizational structure (other than as expressly permitted
pursuant to the terms and conditions of Section 8.2 hereof) without notifying
Lender of such change in writing at least thirty (30) days prior to the
effective date of such change and without first obtaining the prior consent of
Lender.  Borrower shall execute and deliver to Lender, prior to or
contemporaneously with the effective date of any such change, any financing
statement or amendment to financing statement required by Lender to establish or
maintain the validity, perfection and priority of the security interests granted
by the Loan Documents.  At Lender’s request, Borrower shall execute a
certificate in form satisfactory to Lender listing each trade name under which
Borrower operates or intends to operate the Property, and representing and
warranting that Borrower does business under no other trade name with respect to
the Property.
 
4.2.13     Special Purpose.  Without in any way limiting the provisions of this
Article IV, Borrower shall not take or permit any action that would result in
Borrower or Sole Member not being in compliance with the representations,
warranties and covenants set forth in Section 3.1.24.
 
4.2.14     Prohibited Person.  At all times throughout the Term, including after
giving effect to any Transfers permitted pursuant to the Loan Documents, (a)
none of the funds or other assets of Borrower, Sponsor or Guarantor shall
constitute property of, or shall be beneficially owned, directly or indirectly,
by any Prohibited Person, with the result that the investment in Borrower,
Sponsor or Guarantor, as applicable (whether directly or indirectly), would be
prohibited by law, or the Loan made by Lender would be in violation of law, (b)
no Prohibited Person shall have any interest of any nature whatsoever in
Borrower, Sponsor or Guarantor, as applicable, with the result that the
investment in Borrower, Sponsor or Guarantor, as applicable (whether directly or
indirectly), would be prohibited by law or the Loan would be in violation of
law, and (c) none of the funds of Borrower, Sponsor or Guarantor, as applicable,
shall be derived from any unlawful activity with the result that the investment
in Borrower, Sponsor or Guarantor, as applicable (whether directly or
indirectly), would be prohibited by law or the Loan would be in violation of
law.
 
80

--------------------------------------------------------------------------------

4.2.15     Intentionally Omitted.
 
4.2.16     REA.
 
(a)           Borrower shall not, without Lender’s prior consent, modify, amend
or supplement, or consent to or suffer any modification, amendment, or
supplementation of the REA.
 
(b)           Borrower shall not, without Lender’s prior consent, otherwise
modify, change, supplement, alter or amend, or waive or release any of its
rights and remedies under the REA.
 
(c)           Borrower shall not take (and hereby assigns to Lender any right it
may have to take) any action to surrender, terminate, cancel, or accept any
surrender, termination or cancellation of the REA.
 
(d)           Borrower shall not assign (other than to Lender) or encumber
(other than in favor of Lender as security for the Obligations) any of its
rights under the REA.
 
V.             INSURANCE, CASUALTY AND CONDEMNATION
 
Section 5.1.           Insurance.
 
5.1.1       Insurance Policies.
 
(a)           Borrower shall obtain and maintain, or cause to be maintained,
insurance for Borrower and the Property providing at least the following
coverages:
 
(i)            comprehensive all risk insurance (including wind and named
storms) on the Improvements and the personal property at the Property (A) in an
amount equal to one hundred percent (100%) of the “full replacement cost” of the
Property, which for purposes of this Agreement shall mean actual replacement
value (exclusive of costs of excavations, foundations, underground utilities and
footings) with a waiver of depreciation; (B) containing an agreed amount
endorsement with respect to the Improvements and personal property at the
Property waiving all co-insurance provisions; (C) providing for no deductible in
excess of Seventy-Five Thousand and No/100 Dollars ($75,000) for all such
insurance coverage (except, in the case of wind and named storms or earthquake
insurance coverage, providing for no deductible in excess of 5% of the total
insurable value of the Property); and (D) containing “law and ordinance”
coverage if any of the Improvements or the use of the Property shall at any time
constitute a legal non-conforming structure or use.  In addition, Borrower shall
obtain:  (1) if any portion of the Improvements is currently or at any time in
the future located in a federally designated “special flood hazard area,” 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, plus such excess amount as Lender shall require; and (2) if
the Property is located in an area with a high degree of seismic activity and
the probable maximum loss (PML) or scenario expected loss (SEL) is greater than
20%, earthquake insurance in amounts and in form and substance satisfactory to
Lender, provided that the insurance pursuant to clauses (1) and (2) hereof shall
be on terms consistent with the comprehensive all risk insurance policy required
under this Section 5.1.1(a)(i).
 
81

--------------------------------------------------------------------------------

(ii)           broad form commercial general liability insurance against claims
for personal injury, bodily injury, death or property damage occurring upon, in
or about the Property, such insurance (A) to be on the so-called “occurrence”
form with an occurrence limit of not less than One Million and No/100 Dollars
($1,000,000) and an aggregate limit of not less than Two Million and No/100
Dollars ($2,000,000); (B) to continue at not less than the aforesaid limit until
required to be changed by Lender 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 on an “if
any” basis; (3) independent contractors; (4) contractual liability for all
insured contracts; and (5) contractual liability covering the indemnities
contained in Article 9 of the Security Instrument to the extent the same is
available;
 
(iii)          business income insurance (A) with loss payable to Lender; (B)
covering all risks required to be covered by insurance pursuant to Sections
5.1.1(a)(i), (iv), (vi), (xi) and (xii) for a period commencing at the time of
loss for such length of time as it takes to repair or replace with the exercise
of due diligence and dispatch or the expiration of eighteen (18) months from the
date of loss, whichever first occurs, and notwithstanding that the Policy may
expire prior to the end of such period; (C) in an amount equal to one hundred
percent (100%) of the projected gross income from the Property for a period from
the date of loss to a date (assuming total destruction) which is eighteen
(18) months from the date that the Property is repaired or replaced and
operations are resumed; and (D) containing an extended period of indemnity
endorsement which provides that after the physical loss to the Improvements and
the 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.  The amount of such business income insurance 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
twelve (12) month period.  All proceeds payable to Lender pursuant to this
Section 5.1.1(a)(iii) 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 obligation to pay the Debt at the
time and in the manner provided for in this Agreement, the Note and the other
Loan Documents except to the extent such amounts are actually paid out of the
proceeds of such business income insurance;
 
82

--------------------------------------------------------------------------------

(iv)          at all times during which structural construction, repairs or
alterations are being made with respect to the Improvements, and only if the
property and liability coverage forms do not otherwise apply, (A) commercial
general liability and umbrella liability insurance covering claims related to
construction, repair and alteration at the Property not covered by or under the
terms or provisions of the commercial general liability insurance and umbrella
liability insurance policies required under this Section 5.1.1; and (B) the
insurance provided for in Section 5.1.1(a)(i) above written in a so-called
builder’s risk completed value form in amounts and with deductibles, terms and
conditions required by Lender (1) on a non-reporting basis, (2) covering all
risks required to be insured against pursuant to Sections 5.1.1(a)(i), (iii),
(vi), (xi) and (xii), (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 in which the Property is located, and employer’s liability insurance with
a limit of at least One Million and No/100 Dollars ($1,000,000) per accident and
per disease per employee, and One Million and No/100 Dollars ($1,000,000) for
disease aggregate 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 in amounts required
by Lender and on terms consistent with the insurance required under Section
5.1.1(a)(i) above (if applicable);
 
(vii)         umbrella liability insurance in addition to primary coverage in an
amount not less than Twenty-Five Million and No/100 Dollars ($25,000,000) per
occurrence on terms consistent with the insurance required under Section
5.1.1(a)(ii) and (viii);
 
(viii)        commercial auto liability coverage for all owned and non-owned
vehicles, including rented and leased vehicles, containing minimum limits per
occurrence of One Million and No/100 Dollars ($1,000,000) (if applicable);
 
(ix)           liquor liability insurance or other liability insurance required
in connection with the sale of alcoholic beverages (if applicable);
 
(x)            insurance against employee dishonesty with respect to any
employee of Borrower in an amount required by Lender and with a deductible not
greater than Ten Thousand and No/100 Dollars ($10,000) (if applicable);
 
(xi)           with respect to commercial property, general liability, business
income, and umbrella liability insurance required under this Section 5.1.1(a)
(including, if applicable, insurance required under Section 5.1.1(a)(iv) above),
insurance for loss resulting from perils and acts of terrorism in amounts and
with terms and conditions applicable to commercial property, general liability,
business income, and umbrella liability insurance required under this Section
5.1.1(a).  The Policy or endorsement providing for such insurance shall be in
form and substance satisfactory to Lender and shall satisfy Rating Agency
criteria for securitized loans; and
 
83

--------------------------------------------------------------------------------

(xii)          upon sixty (60) days’ notice, such other insurance and in such
amounts as Lender may, from time to time, reasonably request against such other
insurable hazards which at the time are commonly insured against for properties
similar to the Property located in or around the region in which the Property is
located.
 
(b)           All insurance provided for in Section 5.1.1(a) shall be obtained
under valid and enforceable policies (each individually, a “Policy” and
collectively, the “Policies”) and, to the extent not specified above, shall be
subject to the approval of Lender as to insurers, amounts, deductibles, loss
payees and insureds.  Not less than fifteen (15) days prior to the expiration
dates of the Policies theretofore furnished to Lender, certificates of insurance
evidencing the Policies (and, upon Lender’s request, certified copies of such
Policies) accompanied by evidence satisfactory to Lender of payment of the
premiums then due thereunder (the “Insurance Premiums”) shall be delivered by
Borrower to Lender.
 
(c)           Any blanket insurance Policy shall be subject to Lender’s
approval, which approval shall be conditioned upon, among other things, evidence
satisfactory to Lender that such Policy provides the same protection as would a
separate Policy insuring only the Property in compliance with the provisions of
Section 5.1.1(a).
 
(d)           All Policies of insurance provided for or contemplated by Section
5.1.1(a) shall be primary coverage and shall name Borrower as a named insured
and, in the case of liability insurance, except for the Policies referenced in
Sections 5.1.1(a)(v) and (viii), shall name Lender and its successors and/or
assigns as the additional insured, as its interests may appear, and, in the case
of property insurance (including, but not limited to, flood, earthquake, boiler
and machinery, and terrorism insurance), shall name Lender and its successors
and/or assigns, as their interests may appear, as mortgagee pursuant to a
non‑contributing mortgagee clause in favor of Lender and its successors and/or
assigns providing that the loss thereunder shall be payable to Lender and its
successors and/or assigns.  Borrower shall not procure or permit any of its
constituent entities to procure any other insurance coverage which would be on
the same level of payment as the Policies or would adversely impact in any way
the ability of Borrower or Lender to collect any proceeds under any of the
Policies.
 
(e)           All Policies of insurance provided for in Section 5.1.1(a) shall:
 
(i)            contain clauses or endorsements to the effect that, with respect
to the Policies of property insurance, (A) no foreclosure or similar action, or
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, (B) the Policies shall not be canceled without at least
thirty (30) days’ written notice to Lender (or, in the case of non-payment of
premiums, ten (10) days' notice to Lender) and (C) the issuer(s) of the Policies
shall give written notice to Lender if the issuer(s) elect(s) not to renew the
Policies prior to the expiration thereof;
 
84

--------------------------------------------------------------------------------

(ii)           contain clauses or endorsements to the effect that the Policies
shall not be canceled or permitted to lapse without at least thirty (30) days’
written notice to Lender and any other party named therein as an additional
insured and shall not be materially changed (other than to increase the coverage
provided thereby) without such a thirty (30) days’ written notice.  If the
issuer(s) cannot or will not provide such notice, Borrower shall be obligated to
provide such notice to Lender;
 
(iii)          not contain any clause or provision that would make Lender liable
for any Insurance Premiums thereon or subject to any assessments thereunder; and
 
(iv)          contain clauses or endorsements to the effect that the issuer(s)
thereof shall give written notice to Lender if the issuer(s) elect(s) not to
renew such Policies prior to the expiration thereof.  If the issuer(s) cannot or
will not provide such notice, Borrower shall be obligated to provide such notice
to Lender.
 
(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, the obtaining of such insurance coverage as Lender in its sole
discretion deems appropriate and all costs and expenses (including any Insurance
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 with interest at the Default Rate from the date such costs and expenses
were incurred to and including the date the reimbursement payment is received by
Lender.  All such indebtedness shall be secured by the Security Instrument.
 
(g)           In the event of foreclosure of the Security Instrument or other
transfer of title to the Property in extinguishment in whole or in part of the
Obligations, 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 Lender, the purchaser at such foreclosure or the transferee in
the event of such other transfer of title.
 
5.1.2       Insurance Company.  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.
 
5.1.3       Ionis Lease.  Notwithstanding the provisions of Section 5.1.1 hereof
to the contrary, Borrower shall not be required to maintain the coverages
otherwise required pursuant to Section 5.1.1 hereof, provided that each of the
following conditions is satisfied and remains satisfied at all times: (i) the
Ionis Lease Condition is satisfied, (ii) Ionis, as Tenant under the Ionis Lease,
maintains insurance, and with insurance companies, that satisfy the requirements
set forth in Sections 5.1.1 and 5.1.2 hereof, which insurance policies name
Lender as mortgagee/loss payee and additional insured, and (iii) Ionis performs
its obligation under the preceding clause (ii) in a timely manner and Borrower
provides evidence to Lender, in form and substance reasonably satisfactory to
Lender, of such performance by Ionis in a timely manner.  If at any time any or
all of the conditions set forth in the immediately preceding sentence are no
longer met, Borrower shall, at Borrower’s sole cost and expense, immediately
obtain and shall thereafter continue to maintain insurance, and with insurance
companies, that satisfy the requirements set forth in Sections 5.1.1 and 5.1.2
hereof.  Such insurance shall either be (x) “primary” insurance coverage in the
event that Ionis does not provide the applicable insurance coverage required by
this Section 5.1, or (y) “excess and contingent” insurance coverage, over and
above any other valid and collectible coverage then in existence, in the event
that Ionis does not have sufficient coverage to meet the requirements set forth
in Section 5.1.1 above, in each case, as shall be necessary to bring the
insurance coverage for the Property into full compliance with all of the terms
and conditions of this Section 5.1.
 
85

--------------------------------------------------------------------------------

Section 5.2.           Casualty and Condemnation.
 
5.2.1       Casualty.  If the Property shall sustain a Casualty, Borrower shall
give prompt notice of such Casualty to Lender and shall promptly commence and
diligently prosecute to completion the Restoration of the Property in accordance
with Section 5.3 hereof.  Borrower shall pay all costs and expenses of such
Restoration whether or not such costs and expenses are covered by insurance. 
Lender may, but shall not be obligated to, make proof of loss if not made
promptly by Borrower.  In the event of a Casualty where the loss and the
applicable Net Proceeds are less than the Restoration Threshold, Borrower may
settle and adjust such claim; provided that (a) no Event of Default has occurred
and remains outstanding and (b) such adjustment is carried out in a commercially
reasonable and timely manner.  In the event of a Casualty where the loss or the
applicable Net Proceeds is equal to or greater than the Restoration Threshold or
if an Event of Default has occurred and remains outstanding, Borrower may settle
and adjust such claim only with the prior consent of Lender (which consent shall
not be unreasonably withheld or delayed) and Lender shall have the opportunity
to participate, at Borrower’s cost and expense, in any such adjustments. 
Notwithstanding any Casualty, Borrower shall continue to pay the Debt at the
time and in the manner provided for in this Agreement, the Note and the other
Loan Documents.
 
5.2.2       Condemnation.  Borrower shall give Lender prompt notice of any
actual or threatened Condemnation by any Governmental Authority of all or any
part of the Property and shall deliver to Lender a copy of any and all notices
or papers served in connection with such Condemnation or related proceedings. 
Borrower may settle and compromise any Condemnation only with the prior consent
of Lender (which consent shall not be unreasonably withheld or delayed) and
Lender shall have the opportunity to participate, at Borrower’s cost and
expense, in any applicable litigation or proceeding and settlement discussions
in respect thereof and Borrower shall from time to time deliver to Lender all
instruments requested by Lender to permit such participation.  Borrower shall,
at its cost and expense, diligently prosecute any such litigations or
proceedings, and shall consult with Lender, its attorneys and experts, and
cooperate with them in the carrying on or defense of any such litigations or
proceedings.  Lender is hereby irrevocably appointed as Borrower’s
attorney-in-fact, coupled with an interest, with exclusive power to collect,
receive and retain any Award and to make any compromise or settlement in
connection with any Condemnation.  Notwithstanding any Condemnation, Borrower
shall continue to pay the Debt at the time and in the manner provided for in
this Agreement, the Note and the other Loan Documents.  Lender shall not be
limited to the interest paid on the Award by any Governmental Authority but
shall be entitled to receive interest at the rate or rates provided herein or in
the Note.  If any portion of the Property is taken by any Governmental
Authority, Borrower shall promptly commence and diligently prosecute to
completion the Restoration of the Property and otherwise comply with the
provisions of Section 5.3 hereof.  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 in full.
 
86

--------------------------------------------------------------------------------

5.2.3       Casualty Proceeds.  Notwithstanding the last sentence of Section
5.1.1(a)(iii) above, and provided that no Event of Default has occurred and
remains outstanding, proceeds received by Lender on account of business or
rental interruption or other loss of income insurance specified in Section
5.1.1(a)(iii) above with respect to any Casualty shall be (a) during any Cash
Management Trigger Event Period, deposited by Lender into the Cash Management
Account (in installments from time to time, if applicable) to the extent such
proceeds (or a portion thereof) reflects a replacement for lost Rents for the
relevant period, as determined by Lender in good faith and (b) during the
absence of a Cash Management Trigger Event Period, held by Lender and disbursed
to Borrower (in installments from time to time, if applicable) to the extent
such proceeds (or a portion thereof) reflects a replacement for lost Rents for
the relevant period, as determined by Lender in good faith.  All other such
proceeds shall be held by Lender and disbursed in accordance with Section 5.3
hereof.
 
Section 5.3.           Delivery of Net Proceeds.
 
5.3.1       Minor Casualty or Condemnation.  If a Casualty or Condemnation has
occurred to the Property and the Net Proceeds shall be less than the Restoration
Threshold and the costs and expenses to complete the Restoration shall be less
than the Restoration Threshold, the Net Proceeds will be disbursed by Lender to
Borrower upon receipt; provided that, subject to Section 5.3.2(i) hereof, all of
the conditions set forth in Section 5.3.2(a) hereof are met and Borrower
delivers a written undertaking to commence and complete the Restoration in an
expeditious and diligent fashion and in accordance with all applicable Legal
Requirements.  If any Net Proceeds are received by Borrower and may be retained
by Borrower pursuant to the terms hereof, such Net Proceeds shall, until
completion of the Restoration, be held by Borrower in trust for Lender and shall
be segregated from other funds of Borrower to be used to pay for the costs and
expenses of Restoration in accordance with the terms hereof.
 
5.3.2       Major Casualty or Condemnation.
 
(a)           If a Casualty or Condemnation has occurred to the Property and the
Net Proceeds are equal to or greater than the Restoration Threshold or the costs
and expenses to complete the Restoration are equal to or greater than the
Restoration Threshold, Lender shall make the Net Proceeds available for the
Restoration, provided that each of the following conditions is satisfied:
 
(i)            no Event of Default shall have occurred and remain outstanding;
 
(ii)           (A) in the event the Net Proceeds are Insurance Proceeds, less
than thirty-five percent (35%) of the total floor area of the Improvements at
the Property has been damaged, destroyed or rendered unusable as a result of
such Casualty or (B) in the event the Net Proceeds are an Award, less than ten
percent (10%) of the land constituting the Property is taken, and such land is
located along the perimeter or periphery of the Property, and no portion of the
Improvements is the subject of the Condemnation;
 
87

--------------------------------------------------------------------------------

(iii)          [reserved]
 
(iv)          [reserved]
 
(v)           Leases requiring payment of annual rent equal to not less than
seventy-five percent (75%) of the Gross Income from Operations received by
Borrower during the twelve (12) month period immediately preceding the Casualty
or Condemnation and all Major Leases 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, notwithstanding the occurrence of such
Casualty or Condemnation;
 
(vi)          Borrower shall commence the process of completing the Restoration
as soon as reasonably practicable (but in no event later than ninety (90) days
after the occurrence of such Casualty or Condemnation provided however, Lender
in its reasonable discretion may extend such time period in the event Borrower
is unable to obtain permits with respect to the Restoration within this time
period from any applicable Governmental Authority provided that Borrower has
commenced and is diligently pursuing the issuance of same) and shall diligently
pursue the same to satisfactory completion;
 
(vii)         Lender shall be satisfied that any operating deficits and all
scheduled payments under this Agreement and the other Loan Documents (including
scheduled payments of principal and interest) will be paid during the period
required for Restoration from (A) the Net Proceeds, (B) the Insurance Proceeds
of the business or rental interruption or other loss of income insurance
specified in Section 5.1.1(a)(iii) hereof or (C) other funds of Borrower;
 
(viii)        Lender shall be satisfied that the Restoration will be completed
on or before the earliest to occur of (A) the date that is six (6) months prior
to the Maturity Date, (B) the earliest date required for such completion under
the terms of any Lease, (C) the date required for such completion pursuant to
the REA, (D) the date, if any, required under the applicable Legal Requirements
for such completion, (E) the date required for such completion under the terms
of the Ionis Lease or (F) 6 months prior to the expiration of the insurance
coverage specified in Section 5.1.1(a)(iii) hereof;
 
(ix)           the Property and the use thereof after the Restoration will be in
compliance with and permitted under all applicable Legal Requirements;
 
(x)            the Restoration shall be done and completed by Borrower in an
expeditious and diligent fashion and in compliance with all applicable Legal
Requirements;
 
88

--------------------------------------------------------------------------------

(xi)          such Casualty or Condemnation, as applicable, does not result in
the loss of access to the Property or the Improvements;
 
(xii)          the Management Agreement, if any, shall remain in full force and
effect, notwithstanding the occurrence of such Casualty or Condemnation;
 
(xiii)         [reserved];
 
(xiv)         all Operating Agreements shall remain in full force and effect,
notwithstanding the occurrence of such Casualty or Condemnation;
 
(xv)          after giving effect to such Restoration, the pro forma Debt
Service Coverage Ratio shall not be less than the Debt Service Coverage Ratio as
of the Closing Date;
 
(xvi)         Lender shall be satisfied that, upon the completion of the
Restoration, the Loan-to-Value Ratio shall not be greater than the Loan-to-Value
Ratio as of the Closing Date;
 
(xvii)        Borrower shall deliver, or cause to be delivered, to Lender a
signed, detailed budget approved in writing by Borrower’s architect or engineer
stating all of the costs and expenses of completing the Restoration, which
budget shall be acceptable to Lender; and
 
(xviii)      the Net Proceeds, together with any cash or cash equivalent
deposited by Borrower with Lender, are sufficient, in Lender’s reasonable
judgment, to pay for all costs and expenses of the Restoration in full.
 
(b)           The Net Proceeds shall be paid directly to Lender and held by
Lender in an interest-bearing account and, until disbursed in accordance with
the provisions of this Section 5.3.2, shall constitute additional security for
the Obligations.  The Net Proceeds (including all interest earned thereon) 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 (i) all requirements set forth in Section 5.3.2(a) have been satisfied,
(ii) 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 Restoration have been paid for in full, and (iii) 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 arising out of the Restoration which have not either
been fully bonded by a surety company acceptable to Lender and the Rating
Agencies to the satisfaction of Lender and discharged of record or, in the
alternative, fully insured to the satisfaction of Lender by the title insurance
company issuing the Title Insurance Policy.
 
89

--------------------------------------------------------------------------------

(c)           All plans and specifications in connection with the Restoration
shall be subject to the prior approval of Lender, which approval shall not be
unreasonably withheld or delayed, and an independent architect or engineer
selected by Lender (such selection not be unreasonably delayed) (the “Casualty
Consultant”).  The plans and specifications shall require that the Restoration
be completed in a first-class workmanlike manner at least equivalent to the
quality and character of the original work in the Improvements so that, upon
completion thereof, the Property shall be at least equal in value and general
utility to the Property prior to the Casualty or Condemnation, as applicable (it
being understood, however, that (i) Borrower shall not be obligated to restore
the Property to the precise condition of the Property prior to such Casualty or
Condemnation, as applicable, and (ii) in the case of a partial Condemnation, the
Restoration shall be done to the extent reasonably practicable after taking into
account the consequences of such partial Condemnation; provided that the
Property shall be restored, to the extent reasonably practicable, to be of at
least equal value and of substantially the same character as prior to the
Casualty or Condemnation, as applicable).  Borrower shall restore all
Improvements such that when they are fully restored and/or repaired, such
Improvements and their contemplated use fully comply with all applicable Legal
Requirements.  The identity of the contractors, subcontractors and materialmen
engaged in the Restoration, as well as the contracts under which they have been
engaged, shall be subject to the prior approval of Lender and the Casualty
Consultant.  All costs and expenses incurred by Lender in connection with
recovering, holding and disbursing the Net Proceeds for the Restoration
(including, without limitation, reasonable attorneys’ fees and expenses and the
Casualty Consultant’s fees and disbursements) shall be paid by Borrower.
 
(d)           In no event shall Lender be obligated to make disbursements of the
Net Proceeds in excess of an amount equal to the costs and expenses actually
incurred from time to time for work in place as part of the Restoration, as
certified by the Casualty Consultant, less the Casualty Retainage.  The term
“Casualty Retainage” shall mean, as to each contractor, subcontractor or
materialman engaged in the Restoration, an amount equal to ten percent (10%) of
the costs and expenses actually incurred for work in place as part of the
Restoration, as certified by the Casualty Consultant, until the Restoration has
been completed.  The Casualty Retainage shall in no event, and notwithstanding
anything to the contrary set forth above in this Section 5.3.2(d), be less than
the amount actually held back by Borrower from contractors, subcontractors and
materialmen engaged in the Restoration.  The Casualty Retainage shall not be
released until the Casualty Consultant certifies to Lender that the Restoration
has been completed in accordance with the provisions of this Section 5.3.2 and
that all approvals necessary for the re-occupancy and use of the Property have
been obtained from all applicable Governmental Authorities, and Lender receives
evidence satisfactory to Lender that the costs and expenses of the Restoration
have been paid in full or will be paid in full out of the Casualty Retainage;
provided, however, that Lender will release the portion of the Casualty
Retainage being held with respect to any contractor, subcontractor or
materialman engaged in the Restoration as of the date upon which (i) the
Casualty Consultant certifies to Lender that such 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, (ii) such contractor, subcontractor or materialman
delivers lien waivers and evidence of payment in full of all sums due to such
contractor, subcontractor or materialman as may be reasonably requested by
Lender or by the title insurance company issuing the Title Insurance Policy, and
(iii) Lender receives an endorsement to the Title Insurance Policy insuring the
continued priority of the Lien of the Security Instrument and evidence of
payment of any premium payable in connection with such endorsement.  If required
by Lender, the release of any such portion of the Casualty Retainage shall be
approved by the surety company, if any, which has issued a payment or
performance bond with respect to the applicable contractor, subcontractor or
materialman.
 
90

--------------------------------------------------------------------------------

(e)            Lender shall not be obligated to make disbursements of the Net
Proceeds more frequently than once every calendar month.
 
(f)            If at any time the Net Proceeds or the undisbursed balance
thereof shall not, in the opinion of Lender in consultation with the Casualty
Consultant, be sufficient to pay in full the balance of the costs and expenses
which are estimated by the Casualty 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 and expenses actually
incurred in connection with the Restoration on the same terms and conditions
applicable to the disbursement of the Net Proceeds, and until so disbursed
pursuant to this Section 5.3.2 shall constitute additional security for the
Obligations.
 
(g)           The excess, if any, of the Net Proceeds and the remaining balance,
if any, of the Net Proceeds Deficiency deposited with Lender after (i) the
Casualty Consultant certifies to Lender that the Restoration has been completed
in accordance with the provisions of this Section 5.3.2 and (ii) the receipt by
Lender of evidence satisfactory to Lender that all costs and expenses incurred
in connection with the Restoration have been paid in full shall be remitted by
Lender to Borrower, provided that no Event of Default has occurred and remains
outstanding; provided, however, that, in the case of a Condemnation, the amount
returned to Borrower in accordance with this Section 5.3.2(g) shall not exceed
the amount of the Net Proceeds Deficiency deposited by Borrower with the balance
being applied to the Debt in the manner provided for in Section 5.3.2(h) hereof.
 
(h)           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 5.3.2(g) hereof may be retained and applied by Lender toward the
payment of the Debt in accordance with Section 2.4.2 hereof, whether or not then
due and payable, in such order, proportion and priority as Lender in its sole
discretion shall deem proper, or, at the discretion of Lender, the same may be
paid, either in whole or in part, to Borrower for such purposes as Lender shall
approve in its sole discretion.
 
(i)            Notwithstanding anything to the contrary contained herein or in
any other Loan Document, if the Loan or any portion thereof or interest therein
is included in a REMIC Trust and, immediately following a release of any portion
of the Lien of the Security Instrument following a Casualty or Condemnation (but
taking into account any proposed Restoration of the remaining Property), the
ratio of the unpaid principal balance of the Loan to the value of the remaining
Property is greater than 125% (such value to be determined, in Lender’s sole
discretion, by any commercially reasonable method permitted to a REMIC Trust,
(i) based solely on real property and excluding any personal property and going
concern value, if any, and (ii) for purposes of clarification, it being
understood and agreed that such value shall be determined by Lender in
compliance with Treasury Regulations Section 1.860G-2(a)(2) (i.e., for purposes
of such loan-to-value ratio, such value of the remaining Property shall be
reduced by (A) the amount of any lien on real property that is senior to the
Loan and (B) the proportionate amount of any lien on real property that is in
parity with the Loan), the principal balance of the Loan must be paid down by an
amount equal to the least of the following amounts:  (1) the Net Proceeds, (2)
the fair market value of the released property at the time of the release, or
(3) an amount such that the loan-to-value ratio of the Loan (as so determined by
Lender) does not increase after the release, unless Lender receives an opinion
of counsel that if such amount is not paid, the applicable Securitization will
not fail to maintain its status as a REMIC Trust as a result of the related
release of such portion of the Lien of the Security Instrument.  If and to the
extent the preceding sentence applies, only such amount of the Net Proceeds, if
any, in excess of the amount required to pay down the principal balance of the
Loan may be released for purposes of Restoration or released to Borrower as
otherwise expressly provided in this Section 5.3.
 
91

--------------------------------------------------------------------------------

VI.           RESERVE FUNDS AND CASH MANAGEMENT
 
Section 6.1.           [Reserved].
 
Section 6.2.           Tax Funds.
 
6.2.1       Deposits of Tax Funds.  (a) On each Monthly Payment Date, Borrower
shall deposit with Lender an amount equal to one-twelfth (1/12) of the Taxes
(the “Monthly Tax Deposit”) that Lender estimates will be payable during the
next ensuing twelve (12) months in order to accumulate sufficient funds to pay
all such Taxes at least thirty (30) days prior to their respective due dates. 
Amounts deposited pursuant to this Section 6.2.1 are referred to herein as the
“Tax Funds” and the account in which such amounts are held by Lender shall
hereinafter be referred to as the “Tax Account.”  If at any time Lender
reasonably determines that the Tax Funds will not be sufficient to pay the Taxes
at least thirty (30) days prior to the respective due dates, Lender shall notify
Borrower of such determination and the monthly deposits for Taxes shall be
increased by the amount that Lender estimates is sufficient to make up the
deficiency at least thirty (30) days prior to the respective due dates for the
Taxes; provided that if Borrower receives notice of any such deficiency after
the date that is thirty (30) days prior to the date that Taxes are due, Borrower
will deposit such amount within one (1) Business Day after its receipt of such
notice.
 
(b)           Notwithstanding the provisions of Section 4.6(a) hereof to the
contrary, provided that each of the Tax Reserve Waiver Conditions Precedent are
satisfied and remain satisfied at all times, Borrower shall not be required to
make an initial deposit to the Tax Account or the Monthly Tax Deposit on account
of Taxes as provided herein.  If at any time any or all of the Tax Reserve
Waiver Conditions Precedent are no longer met, Borrower shall immediately
commence and shall continue to fund the Tax Account on account of Taxes as
provided herein.
 
6.2.2       Release of Tax Funds.
 
(a)           Lender will apply the Tax Funds to payments of Taxes required to
be made by Borrower pursuant to Section 4.1.2 hereof and under the Security
Instrument.  Borrower shall furnish Lender with all bills, statements and
estimates for Taxes at least thirty (30) days prior to the date on which such
Taxes first become payable.  In making any payment relating to Taxes, Lender may
do so according to any bill, statement or estimate procured from the public
office (with respect to Taxes) 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 Funds
shall exceed the amounts due for Taxes, Lender shall, in its sole discretion,
return any excess to Borrower or credit such excess against future payments to
be made to the Tax Funds.  Any Tax Funds remaining after the Debt has been paid
in full shall be returned to Borrower.
 
92

--------------------------------------------------------------------------------

(b)           All costs and expenses incurred by Lender in connection with
holding and disbursing the Tax Funds (including, without limitation, the costs
and expenses of the inspections, if any, required hereunder) shall be paid by
Borrower.
 
Section 6.3.           Insurance Funds.
 
6.3.1       Deposits of Insurance Funds.  (a)  On each Monthly Payment Date,
Borrower shall deposit with Lender an amount equal to one-twelfth (1/12) of the
Insurance Premiums (the “Monthly Insurance Deposit”) that Lender estimates will
be payable for the renewal of the coverages afforded by the Policies upon the
expiration thereof in order to accumulate sufficient funds to pay all such
Insurance Premiums at least thirty (30) days prior to the expiration of the
Policies.  Amounts deposited pursuant to this Section 6.3.1 are referred to
herein as the “Insurance Funds” and the account in which such amounts are held
by Lender shall hereinafter be referred to as the “Insurance Account.”  If at
any time Lender reasonably determines that the Insurance Funds will not be
sufficient to pay the Insurance Premiums at least thirty (30) days prior to the
expiration of the Policies, Lender shall notify Borrower of such determination
and the monthly deposits for Insurance Premiums shall be increased by the amount
that Lender estimates is sufficient to make up the deficiency at least thirty
(30) days prior to expiration of the Policies; provided that if Borrower
receives notice of any such deficiency after the date that is thirty (30) days
prior to expiration of the Policies, Borrower will deposit such amount within
one (1) Business Day after its receipt of such notice.
 
(b)           Notwithstanding the provisions of Section 6.3.1(a) hereof to the
contrary, provided that each of the Insurance Reserve Waiver Conditions
Precedent are satisfied and remain satisfied at all times, Borrower shall not be
required to make an initial deposit to the Insurance Account nor the Monthly
Insurance Deposits on account of Insurance Premiums as provided herein.  If at
any time any or all of the Insurance Reserve Waiver Conditions Precedent are no
longer met, Borrower shall immediately begin and shall continue to fund the
Insurance Account on account of Insurance Premiums as provided herein.
 
6.3.2       Release of Insurance Funds.
 
(a)           Lender will apply the Insurance Funds to payments of Insurance
Premiums for the Policies required to be maintained by Borrower pursuant to
Section 5.1.1 hereof.  Borrower shall furnish Lender with all bills, invoices
and statements for Insurance Premiums at least thirty (30) days prior to the
date on which such Insurance Premiums first become payable.  In making any
payment relating to Insurance Premiums, Lender may do so according to any bill,
invoice or statement procured from the insurance company or its agent, without
inquiry into the accuracy of such bill, invoice or statement.  If the amount of
the Insurance Funds shall exceed the amounts due for Insurance Premiums, Lender
shall, in its sole discretion, return any excess to Borrower or credit such
excess against future payments to be made to the Insurance Funds.
 
93

--------------------------------------------------------------------------------

(b)           All costs and expenses incurred by Lender in connection with
holding and disbursing the Insurance Funds (including, without limitation, the
costs and expenses of the inspections, if any, required hereunder) shall be paid
by Borrower.
 
Section 6.4.           Capital Expenditure Funds.
 
6.4.1       Deposits of Capital Expenditure Funds(a).  On each Monthly Payment
Date, Borrower shall deposit with Lender an amount equal to Twenty-Nine Thousand
Three Hundred Thirty-Three and 33/100 Dollars ($29,333.33) (the “Monthly Capital
Expenditure Deposit”) for annual Capital Expenditures set forth in the Approved
Annual Budget or otherwise approved by Lender, which approval shall not be
unreasonably withheld or delayed.  Amounts deposited pursuant to this Section
6.4.1 are referred to herein as the “Capital Expenditure Funds” and the account
in which such amounts are held by Lender shall hereinafter be referred to as the
“Capital Expenditure Account.”  Lender may reassess its estimate of the amount
necessary for Capital Expenditures from time to time and may require Borrower to
increase the monthly deposits required pursuant to this Section 6.4.1 upon
thirty (30) days’ notice to Borrower if Lender determines in its reasonable
discretion that an increase is necessary for proper maintenance and operation of
the Property.  Notwithstanding any provisions of Section 6.4.1(a) hereof to the
contrary, provided and on condition that each of the Capital Expenditure Reserve
Waiver Conditions Precedent are satisfied and remain satisfied at all times,
Borrower shall not be required to make the initial deposit to the Capital
Expenditure Account on account of Capital Expenditures or make the Monthly
Capital Expenditure Deposit on account of Capital Expenditures as provided
herein.  If at any time any or all of the Capital Expenditure Reserve Waiver
Conditions Precedent are no longer met, Borrower shall immediately begin and
shall continue to fund the Capital Expenditure Account on account of Capital
Expenditures as provided herein.
 
6.4.2       Release of Capital Expenditure Funds.
 
(a)           Lender shall disburse Capital Expenditure Funds only for Capital
Expenditures.
 
(b)           Lender shall disburse to Borrower the Capital Expenditure Funds
upon satisfaction by Borrower of each of the following conditions:  (i) Borrower
shall submit a request for payment to Lender at least thirty (30) days prior to
the date on which Borrower requests such payment be made and specifies the
Capital Expenditures to be paid, (ii) on the date such request is received by
Lender and on the date such payment is to be made, no Default or Event of
Default shall have occurred and remain outstanding, (iii) Lender shall have
received an Officer’s Certificate (A) stating that all items to be funded by the
requested disbursement are Capital Expenditures, (B) stating that all Capital
Expenditures to be funded by the requested disbursement have been completed in a
good and workmanlike manner and in accordance with all applicable Legal
Requirements, such certificate to be accompanied by a copy of any license,
permit or other approval required by any Governmental Authority in connection
with such Capital Expenditures, (C) identifying each Person that supplied
materials or labor in connection with the Capital Expenditures to be funded by
the requested disbursement, (D) stating that each such Person has been paid in
full or will be paid in full upon such disbursement, such certificate to be
accompanied by lien waivers or other evidence of payment satisfactory to Lender,
and (E) stating that the Capital Expenditures to be funded by the requested
disbursement have not been the subject of a previous disbursement, (iv) at
Lender’s option, a title search for the Property indicating that the Property is
free from all liens, claims and other encumbrances not previously approved by
Lender, and (v) Lender shall have received such other evidence as Lender shall
reasonably request that the Capital Expenditures to be funded by the requested
disbursement have been completed and are paid for or will be paid for in full
upon such disbursement to Borrower.  Lender shall not be required to disburse
Capital Expenditure Funds more frequently than once each calendar month, and
each disbursement of Capital Expenditure Funds must be in an amount not less
than the Minimum Disbursement Amount (or a lesser amount if the total remaining
balance of Capital Expenditure Funds is less than the Minimum Disbursement
Amount, in which case only one disbursement of the amount remaining in the
Capital Expenditure Account shall be made).
 
94

--------------------------------------------------------------------------------

 
 
(c)           Nothing in this Section 6.4 shall (i) make Lender responsible for
making or completing any Capital Expenditure Work; (ii) obligate Lender to
commence or proceed with any Capital Expenditure Work; (iii) require Lender to
expend funds in addition to the Capital Expenditure Funds to complete any
Capital Expenditure Work; or (iv) obligate Lender to demand from Borrower
additional sums to perform or complete any Capital Expenditure Work.

(d)           If a disbursement of Capital Expenditure Funds will exceed Fifty
Thousand and No/100 Dollars ($50,000), Lender may require an inspection of the
Property prior to such disbursement in order to verify completion of the Capital
Expenditure Work for which reimbursement is sought.  Lender may require that
such inspection be conducted by an independent professional selected by Lender
and may require a certificate of completion by an independent professional
acceptable to Lender prior to such disbursement of Capital Expenditure Funds.
 
(e)           Borrower shall permit Lender and its agents and representatives
(including, without limitation, Lender’s engineer or architect) or third parties
to enter onto the Property during normal business hours (subject to the rights
of Tenants under their Leases) to inspect the progress of any Capital
Expenditure Work and all materials being used in connection therewith and to
examine all plans, specifications and shop drawings relating to such Capital
Expenditure Work.  Borrower shall cause all contractors, subcontractors and
materialmen to cooperate with Lender and its agents and representatives or such
other Persons described above in connection with the inspections, if any,
required by Lender in accordance with this Section 6.4.2.
 
(f)            All Capital Expenditure Works and all materials, equipment,
fixtures, or any other item comprising a part of any Capital Expenditure Work
shall be constructed, installed or completed, as applicable, free and clear of
all liens, claims and other encumbrances not previously approved by Lender.
 
(g)           All Capital Expenditure Works shall comply with all applicable
Legal Requirements of all Governmental Authorities having jurisdiction over the
Property and all applicable insurance requirements (including, without
limitation, applicable building codes, special use permits, environmental
regulations, and requirements of insurance underwriters).
 
95

--------------------------------------------------------------------------------

(h)           In addition to any insurance required under the Loan Documents,
Borrower shall provide or cause to be provided builder’s risk insurance,
workers’ compensation insurance, public liability insurance and other insurance
to the extent required by the applicable Legal Requirements in connection with
any Capital Expenditure Work.  All such policies shall be in form and amount
reasonably satisfactory to Lender.  All such policies which can be endorsed with
a non-contributing mortgagee clause (or its equivalent) making loss thereunder
payable to Lender and its successors and/or assigns shall be so endorsed.  At
Lender’s request, certified copies of such policies shall be delivered to
Lender.
 
(i)            Any Capital Expenditure Funds remaining after the Debt has been
paid in full shall be returned to Borrower.
 
(j)           All reasonable costs and expenses incurred by Lender in connection
with holding and disbursing the Capital Expenditure Funds (including, without
limitation, the costs and expenses of the inspections, if any, required
hereunder) shall be paid by Borrower.
 
6.4.3       Failure to Perform Capital Expenditure Works.  It shall be an Event
of Default if Borrower fails to comply with any provision of this Section 6.4
and such failure is not cured within thirty (30) days after notice from Lender. 
Upon the occurrence of an Event of Default, Lender may, at its option, use the
Capital Expenditure Funds (or any portion thereof) to perform or complete any
Capital Expenditure Work as provided in Section 6.4.2 hereof or any other repair
or replacement to the Property.  Such right to withdraw and apply the Capital
Expenditure Funds shall be in addition to all other rights and remedies provided
to Lender under this Agreement and the other Loan Documents.
 
Section 6.5.           Rollover Funds.
 
6.5.1       Deposits of Rollover Funds.
 
(a)           On each Monthly Payment Date, Borrower shall deposit with Lender
an amount equal to Two Thousand Nine Hundred Thirty-Three and 33/100 Dollars
($2,933.33) (the “Monthly Rollover Deposit”) for tenant improvements and leasing
commissions that may be incurred following the date hereof.  Amounts deposited
pursuant to this Section 6.5.1 are referred to herein as the “Rollover Funds”
and the account in which such amounts are held by Lender shall hereinafter be
referred to as the “Rollover Account.”  Notwithstanding any provisions of
Section 6.5.1(a) hereof to the contrary, provided and on condition that each of
the Rollover Reserve Waiver Conditions Precedent are satisfied and remain
satisfied at all times, Borrower shall not be required to make the initial
deposit to the Rollover Account on account of tenant improvements or leasing
conditions or make the Monthly Rollover Deposit on account of tenant
improvements or leasing conditions as provided herein.  If at any time any or
all of the Rollover Reserve Waiver Conditions Precedent are no longer met,
Borrower shall immediately begin and shall continue to fund the Rollover Account
on account of tenant improvements and leasing commissions as provided herein.
 
96

--------------------------------------------------------------------------------

(b)           In addition to the deposits required under Section 6.5.1(a),
Borrower shall deposit, or cause to be deposited, with Lender all amounts paid
to Borrower in connection with (i) any modification or amendment of any Lease,
(ii) any consent (including any consent to an assignment or sublease of any
Lease) or waiver by Borrower of any term, condition or provision under any
Lease, (iii) any settlement of claims of Borrower against third parties in
connection with any Lease, (iv) any rejection, termination, surrender,
cancellation or buy-out of any Lease (including in connection with any
Bankruptcy Action and including any payment relating to unamortized tenant
improvements and/or leasing commissions), and (v) any other extraordinary event
pursuant to which Borrower receives payment (in whatever form) derived from or
generated by the use, ownership or operation of the Property not otherwise
covered by this Agreement or the Cash Management Agreement (collectively, the
“Extraordinary Lease Payments”), in each case, with respect to clauses (i),
(ii), (iii), (iv) and (v), net of reasonable, out-of-pocket costs and expenses,
if any, incurred by Borrower.  In connection with any amount required to be
deposited with Lender pursuant to this Section 6.5.1(b), Borrower shall provide
prior notice to Lender of the amount and the nature thereof and otherwise
cooperate with Lender to ensure that such amounts are properly accounted for and
held as Rollover Funds.
 
6.5.2       Release of Rollover Funds.
 
(a)           Lender shall disburse to Borrower the Rollover Funds upon
satisfaction by Borrower of each of the following conditions:  (i) Borrower
shall submit a request for payment to Lender at least thirty (30) days prior to
the date on which Borrower requests such payment be made and specifies the
tenant improvement costs and leasing commissions to be paid or reimbursed, (ii)
on the date such request is received by Lender and on the date such payment or
reimbursement is to be made, no Default or Event of Default shall have occurred
and remain outstanding, (iii) Lender shall have received and, if applicable,
approved the Lease in respect of which Borrower is obligated to pay or reimburse
certain tenant improvement costs and leasing commissions, (iv) Lender shall have
received and, if applicable, approved a budget for tenant improvement costs and
a schedule of leasing commission payments and the requested disbursement will be
used to pay all or a portion of such costs and payments, (v) Lender shall have
received an Officer’s Certificate (A) stating that all tenant improvements at
the Property to be funded by the requested disbursement have been completed in a
good and workmanlike manner and in accordance with all applicable Legal
Requirements, such certificate to be accompanied by a copy of any license,
permit or other approval required by any Governmental Authority in connection
with such tenant improvements, (B) identifying (1) each Person that supplied
materials or labor in connection with the tenant improvements to be funded by
the requested disbursement and (2) each Person that provided brokerage services
in connection with the leasing commissions to be funded by the requested
disbursement, (C) stating that each such Person has been paid in full or will be
paid in full upon such disbursement, such certificate to be accompanied by lien
waivers or other evidence of payment satisfactory to Lender, and (D) stating
that the tenant improvement costs and/or leasing commission payments to be
funded have not been the subject of a previous disbursement,  (vi) at Lender’s
option, a title search for the Property indicating that the Property is free
from all liens, claims and other encumbrances not previously approved by Lender,
(vii) Lender shall have received an estoppel certificate from the applicable
Tenant stating that (A) (1) all work required to be performed by Borrower have
been completed in accordance with the applicable Lease and have been accepted by
such Tenant or (2) all work required to be performed by such Tenant have been
completed and a reimbursement of the amount specified in such estoppel
certificate is due to such Tenant pursuant to its Lease and (B) such Tenant is
in occupancy and paying full unabated rent or has taken possession of the
demised premises, and (viii) Lender shall have received such other evidence as
Lender may reasonably request that (A) the tenant improvements at the Property
to be funded by the requested disbursement have been completed and are paid for
or will be paid for in full upon such disbursement to Borrower and (B) the
leasing commissions to be funded by the requested disbursement have been paid
for or will be paid for in full upon such disbursement to Borrower.  Lender
shall not be required to disburse Rollover Funds more frequently than once each
calendar month, and each disbursement of the Rollover Funds must be in an amount
not less than the Minimum Disbursement Amount (or a lesser amount if the total
remaining balance of Rollover Funds is less than the Minimum Disbursement
Amount, in which case only one disbursement of the amount remaining in the
Rollover Account shall be made).  Any Rollover Funds remaining after the Debt
has been paid in full shall be returned to Borrower.
 
97

--------------------------------------------------------------------------------

(b)           All reasonable costs and expenses incurred by Lender in connection
with holding and disbursing the Rollover Funds shall be paid by Borrower.
 
Section 6.6.          [Reserved].
 
Section 6.7.           Excess Cash Flow Funds.
 
6.7.1       Deposits of Excess Cash Flow Funds.  During a Cash Sweep Trigger
Event Period, Borrower shall deposit with Lender all Excess Cash Flow, which
sums shall be held by Lender as additional security for the Loan.  Amounts so
deposited shall hereinafter be referred to as the “Excess Cash Flow Funds” and
the account in which such amounts are held by Lender shall hereinafter be
referred to as the “Excess Cash Flow Account.”
 
6.7.2       Release of Excess Cash Flow Funds.
 
(a)           Upon the termination of a Cash Sweep Trigger Event Period and
provided that no other Cash Sweep Trigger Event shall have occurred and remain
outstanding, all funds on deposit in the Excess Cash Flow Account shall be
deposited into the Cash Management Account and applied in accordance with this
Agreement and the Cash Management Agreement.
 
(b)           All costs and expenses incurred by Lender in connection with
holding and disbursing the Excess Cash Flow Funds shall be paid by Borrower.
 
98

--------------------------------------------------------------------------------

Section 6.8.           Reserve Funds.
 
6.8.1      Security Interest. Borrower hereby pledges to Lender, and grants a
security interest in, any and all monies now or hereafter deposited in the
Reserve Funds as additional security for the performance of the Obligations.
Until expended or applied as provided in this Agreement, the Reserve Funds shall
constitute additional security for the performance of the Obligations. Lender
shall have no obligation to release any of the Reserve Funds while any Default
or Event of Default has occurred and remains outstanding. Notwithstanding
anything to the contrary contained herein or in any other Loan Document, upon
the occurrence and during the continuance of an Event of Default, Lender may, in
addition to any and all other rights and remedies available to Lender, apply any
sums then present in the Reserve Funds to the payment of the Debt in any order,
proportion and priority as Lender may determine in its sole and absolute
discretion. Borrower shall not further pledge, assign or grant any security
interest in any Reserve Fund or permit any lien or encumbrance to attach
thereto, or any levy to be made thereon, or any UCC-1 Financing Statements,
except those naming Lender as the secured party, to be filed with respect
thereto.
 
6.8.2       Investments; Income Taxes. The Reserve Funds shall be held in
Lender’s name and may be commingled with Lender’s own funds at financial
institutions selected by Lender in its sole discretion. The Reserve Funds shall
be held in an Eligible Account and may be invested in Permitted Investments as
directed by Lender. Lender shall not be liable for any loss sustained on the
investment of any funds constituting the Reserve Funds. Borrower shall deposit
with Lender an amount equal to the actual losses sustained on the investment of
any funds constituting the Reserve Funds in Permitted Investments within one (1)
Business Day of Lender’s notice. All interest on a Reserve Fund shall not be
added to or become a part thereof and shall be the sole property of and shall be
paid to Lender.
 
6.8.3       Indemnity.  Borrower shall indemnify Lender and hold Lender harmless
from and against any and all actions, suits, claims, demands, liabilities,
losses, damages, obligations and costs and expenses (including reasonable
attorneys’ fees and expenses) arising from or in any way connected with the
Reserve Funds or the performance of the obligations for which the Reserve Funds
were established.  Borrower shall assign to Lender all rights and claims
Borrower may have against all Persons supplying labor, materials or other
services which are to be paid or reimbursed from or secured by the Reserve
Funds; provided, however, that Lender may not pursue any such right or claim
unless an Event of Default has occurred and remains outstanding.
 
Section 6.9.          [Reserved].
 
Section 6.10.        [Reserved].
 
Section 6.11.        [Reserved].
 
Section 6.12.        [Reserved].
 
Section 6.13.        Material Tenant Rollover Funds.
 
6.13.1     Deposits of Material Tenant Rollover Funds.  Upon the occurrence and
during the continuation of a Material Tenant Trigger Event with respect to which
a Material Tenant Trigger Event Cure has not occurred, on each Monthly Payment
Date, Borrower shall deposit with Lender the Material Tenant Trigger Event
Excess Cash Flow (the “Monthly Material Tenant Rollover Deposit”) for tenant
improvements and leasing commissions that may be incurred by Borrower following
the occurrence of either (a) an Acceptable Material Tenant Lease Extension or
(b) an Acceptable Re-tenanting Event with respect to the Material Tenant Space. 
Amounts deposited pursuant to this Section 6.13.1 are referred to herein as the
“Material Tenant Rollover Funds” and the account in which such amounts are held
by Lender shall hereinafter be referred to as the “Material Tenant Rollover
Account.”
 
99

--------------------------------------------------------------------------------

6.13.2     Release of Material Tenant Rollover Funds.
 
(a)           Lender shall disburse to Borrower the Material Tenant Rollover
Funds on deposit in the Material Tenant Rollover Account upon satisfaction by
Borrower of each of the following conditions, only with respect to specified
tenant improvements and leasing commissions with respect to the related Material
Tenant Lease:  (i) an Acceptable Material Tenant Lease Extension or an
Acceptable Re-tenanting Event shall have occurred; (ii) Borrower shall submit a
request for payment to Lender at least thirty (30) days prior to the date on
which Borrower requests such payment be made and specifies the tenant
improvement costs and leasing commissions to be paid or reimbursed, (iii) on the
date such request is received by Lender and on the date such payment or
reimbursement is to be made, no Event of Default shall have occurred and remain
outstanding, (iv) regarding an Acceptable Re-tenanting Event, Lender shall have
received and approved the new Lease in respect of which Borrower is obligated to
pay or reimburse for certain tenant improvement costs and leasing commissions,
(v) regarding an Acceptable Material Tenant Lease Extension, Lender shall have
received and approved the written notice of extension of the Material Tenant
Lease, in respect of which Borrower is obligated to pay or reimburse for certain
tenant improvement costs and leasing commissions, (vi) Lender shall have
received and, if applicable, approved a budget for tenant improvement costs and
a schedule of leasing commission payments and the requested disbursement will be
used to pay all or a portion of such costs and payments, (vii) Lender shall have
received an Officer’s Certificate (A) stating that all tenant improvements at
the Property to be funded by the requested disbursement have been completed in a
good and workmanlike manner and in accordance with all applicable Legal
Requirements, in the case of a final disbursement with respect to the tenant
improvements such certificate to be accompanied by a copy of any license, permit
or other approval required by any Governmental Authority in connection with such
tenant improvements, (B) identifying (1) each Person that supplied materials or
labor in connection with the tenant improvements to be funded by the requested
disbursement and (2) each Person that provided brokerage services in connection
with the leasing commissions to be funded by the requested disbursement, (C)
stating that each such Person has been paid in full or will be paid in full upon
such disbursement, such certificate to be accompanied by lien waivers or other
evidence of payment satisfactory to Lender, and (D) stating that the tenant
improvement costs and/or leasing commission payments to be funded have not been
the subject of a previous disbursement, (viii) at Lender’s option, a title
search for the Property indicating that the Property is free from all liens,
claims and other encumbrances not previously approved by Lender, (ix) regarding
an Acceptable Re-tenanting Event, with respect to the last disbursement for the
applicable leased space for which the tenant improvements or leasing commissions
are being funded pursuant to this Section 6.13.2, Lender shall have received an
estoppel certificate from the applicable replacement Tenant or Tenants stating
that (A) (1) all work required to be performed by Borrower have been completed
in accordance with the applicable Lease and have been accepted by such Tenant or
(2) all work required to be performed by such Tenant have been completed and a
reimbursement of the amount specified in such estoppel certificate is due to
such Tenant pursuant to its Lease and (B) such Tenant is in occupancy and paying
full unabated rent without offset or has taken possession of the demised
premises and is paying full unabated rent without offset, (x) regarding an
Acceptable Material Tenant Lease Extension, with respect to the last
disbursement for the applicable leased space for which the tenant improvements
or leasing commissions are being funded pursuant to this Section 6.13.2, Lender
shall have received an estoppel certificate from Material Tenant stating that
(A) (1) all work required to be performed by Borrower have been completed in
accordance with the applicable Lease and have been accepted by Material Tenant
or (2) all work required to be performed by Material Tenant has been completed
and a reimbursement of the amount specified in such estoppel certificate is due
to Material Tenant pursuant to its Lease and (B) Material Tenant is in occupancy
and paying full unabated rent without offset or has taken possession of the
demised premises and is paying full unabated rent without offset, and (xi)
Lender shall have received such other evidence as Lender may reasonably request
that (A) the tenant improvements at the Property to be funded by the requested
disbursement have been completed and are paid for or will be paid for in full
upon such disbursement to Borrower and (B) the leasing commissions to be funded
by the requested disbursement have been paid for or will be paid for in full
upon such disbursement to Borrower.  Lender shall not be required to disburse
Material Tenant Rollover Funds more frequently than once each calendar month,
and each disbursement of the Material Tenant Rollover Funds must be in an amount
not less than the Minimum Disbursement Amount (or a lesser amount if the total
remaining balance of Material Tenant Rollover Funds is less than the Minimum
Disbursement Amount, in which case only one disbursement of the amount remaining
in the Material Tenant Rollover Account shall be made).
 
100

--------------------------------------------------------------------------------

(b)           All reasonable costs and expenses incurred by Lender in connection
with holding and disbursing the Material Tenant Rollover Funds shall be paid by
Borrower.
 
VII.         PROPERTY MANAGEMENT
 
Section 7.1.           Management Agreement.
 
Borrower represents and warrants that Borrower self-manages the Property, and no
agent, affiliated or unaffiliated with Borrower, receives a fee or other
compensation for managing the Property.  Borrower shall not engage a property
manager for the Property without Lender’s prior written consent, which consent
may be conditioned on, among other things, such manager being a Qualified
Manager.  In the event that Lender determines that the Property is not being
managed in accordance with generally accepted management practices for
properties similar to such Property, Lender shall deliver written notice thereof
to Borrower, which notice shall specify with particularity the grounds for
Lender’s determination.  If (A) Lender determines that the conditions specified
in Lender’s notice delivered in accordance with the immediately preceding
sentence are not remedied to Lender’s satisfaction by Borrower within thirty
(30) days from receipt of such notice or that Borrower has failed to diligently
undertake correcting such conditions within such thirty (30) day period, or (B)
an Event of Default has occurred and is continuing, (C) the Debt Service
Coverage Ratio is equal to or less than 1.10 to 1.0 or (D) Borrower notifies
Lender in writing that it no longer wishes to self-manage the Property, (i)
Borrower shall, at Lender’s direction, engage a professional third party
property manager acceptable to Lender and enter into a property management
agreement acceptable to Lender with such management company (the “Management
Agreement”), (ii) Borrower and such third party manager shall execute Lender’s
then standard assignment of management agreement and subordination of management
fees reasonably  acceptable to Lender conditionally assigning Borrower’s
interest in such management agreement to Lender and subordinating manager’s
right to receive fees and expenses under such agreement while the Debt remains
outstanding, and (iii) Borrower shall thereafter comply with the terms of
Sections 7.2 and 7.3 below.
 
101

--------------------------------------------------------------------------------

Section 7.2.          Prohibition Against Termination or Modification.
 
(a)           Borrower shall not, without prior consent of Lender, (i)
surrender, terminate, cancel, modify, renew, amend, or extend the Management
Agreement; provided that Borrower may, without Lender’s consent, replace Manager
with a Qualified Manager pursuant to a Replacement Management Agreement, (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 fees or other
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 connection with the
replacement of Manager with a Qualified Manager, Borrower shall: (A) execute and
cause Qualified Manager to execute an assignment of management agreement and
subordination of management fees in the form then used by Lender and (B) execute
and cause Qualified Franchisor to execute an assignment of franchise agreement
and subordination of franchise fees in the form then used by Lender, as
applicable.
 
(b)           In the event that the Management Agreement expires or is
terminated (without limiting any obligation of Borrower to obtain Lender’s
consent to any termination or modification of the Management Agreement in
accordance with the terms and provisions of this Agreement), Borrower shall
promptly enter into a Replacement Management Agreement with a Qualified Manager.
 
(c)           Upon the occurrence and during the continuation of an Event of
Default, Borrower shall not exercise any rights, make any decisions, grant any
approvals or otherwise take any action under the Management Agreement without
the prior consent of Lender, which consent may be granted, conditioned or
withheld in Lender’s sole discretion.
 
Section 7.3.           Replacement of Manager.
 
Lender shall have the right to require Borrower to replace Manager (if any) with
a Qualified Manager pursuant to Replacement Management Agreement, which is not
an Affiliate of, but is chosen by, Borrower upon the occurrence of any one or
more of the following events:  (a) at any time following the occurrence of an
Event of Default, (b) if Manager shall be in default under the Management
Agreement beyond any applicable notice and cure period, (c) if Borrower,
Guarantor, Sponsor or Manager shall become insolvent or a debtor in any
Bankruptcy Action, (d) if at any time Manager has engaged in gross negligence,
fraud, willful misconduct or misappropriation of funds, and/or (e) if at any
time the Debt Service Coverage Ratio (based upon the trailing twelve (12) month
period immediately preceding the date of such determination is less than 1.10 to
1.0.
 
VIII.        TRANSFERS
 
Section 8.1.           Transfer or Encumbrance of Property.
 
(a)           Without the prior consent of Lender, neither Borrower nor any
Restricted Party shall do any of the following (each, a “Transfer”): sell,
transfer, convey, assign, mortgage, pledge, encumber, alienate, grant a Lien on,
grant any option with respect to or grant any other interest in the Property,
any part thereof or any interest therein (including any legal, beneficial or
economic interest in Borrower or any Restricted Party), directly or indirectly,
voluntarily or involuntarily, by operation of law or otherwise, and whether or
not for consideration or of record, other than Permitted Transfers.
 
102

--------------------------------------------------------------------------------

(b)           A Transfer shall include (i) an installment sales agreement
wherein Borrower agrees to sell the Property, any part thereof or any interest
therein 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 Borrower or any Restricted Party is
a corporation, the voluntary or involuntary sale, conveyance or transfer of such
corporation’s stock (or the stock of any corporation directly or indirectly
Controlling such corporation by operation of law or otherwise) or the creation
or issuance of new stock such that such corporation’s stock shall be vested in a
party or parties who are not now stockholders or any change in the Control of
such corporation; (iv) if Borrower or any Restricted Party is a limited or
general partnership, joint venture or limited liability company, the change,
removal, resignation or addition of a general partner, managing partner, limited
partner, joint venturer or member, the voluntary or involuntary transfer of the
partnership interest of any general partner, managing partner or limited
partner, the creation or issuance of new limited partnership interests, the
voluntary or involuntary transfer of the interest of any joint venturer or
member or the creation or issuance of new non-managing member interests; (v) if
Borrower or any Restricted Party is a trust or nominee trust, the voluntary or
involuntary transfer of the legal or beneficial interest in such trust or
nominee trust or the creation or issuance of new legal or beneficial interests;
and (vi) if Borrower enters into, or the Property is subject to, any PACE Loan.
 
(c)           Lender shall not be required to demonstrate any actual impairment
of its security or any increased risk of default hereunder or under the other
Loan Documents in order to declare the Debt immediately due and payable upon a
Transfer (other than a Permitted Transfer) without Lender’s prior consent.  This
provision shall apply to every Transfer regardless of whether voluntary or not,
and whether or not Lender has consented to any previous Transfer.
 
(d)           Lender’s consent to one Transfer shall not be deemed to be a
waiver of Lender’s right to require such consent to any future occurrence of
same.  Any Transfer made in contravention of this Section 8.1 shall be null and
void and of no force and effect.
 
(e)           Borrower agrees to bear and shall pay or reimburse Lender on
demand for all reasonable costs and expenses (including, without limitation,
reasonable attorneys’ fees and expenses, title search costs and title insurance
endorsement premiums) incurred by Lender in connection with the review, approval
and/or documentation of any proposed Transfer.  If required by Lender, Borrower
shall deposit with Lender an amount equal to Lender’s anticipated costs and
expenses in evaluating any proposed Transfer.
 
(f)           No consent to any assumption of the Loan shall occur on or before
the first (1st) anniversary of the first (1st) Monthly Payment Date. 
Thereafter, Lender’s consent to a Transfer of the Property and the assumption of
the Loan shall not be unreasonably withheld after consideration of all relevant
factors and provided that the following conditions are satisfied:
 
103

--------------------------------------------------------------------------------

(i)            Lender shall have received a notice from Borrower requesting
Lender’s consent to such Transfer not less than sixty (60) days prior to the
proposed date of such Transfer;
 
(ii)           No Default or Event of Default shall have occurred and remain
outstanding;
 
(iii)          The proposed transferee (“Transferee”) shall be a corporation,
partnership or limited liability company that qualifies as a single purpose,
bankruptcy remote entity under criteria established by the Rating Agencies
(including, without limitation, criteria applicable to Transferee’s SPE
Constituent Entities); provided, however, that Transferee shall not be a
Prohibited Entity;
 
(iv)        The Organizational Documents of Transferee and Transferee’s SPE
Constituent Entities shall be reasonably satisfactory to Lender;
 
(v)           Neither any Transferee’s Sponsor, Transferee nor any other Person
owned or Controlled, directly or indirectly, by Transferee’s Sponsors shall have
been a debtor in any Bankruptcy Action or taken advantage of any Bankruptcy Law
or any law for the benefit of debtors within seven (7) years prior to the date
of the proposed Transfer;
 
(vi)          Neither any Transferee’s Sponsor, Transferee nor any other Person
owned or Controlled, directly or indirectly, by Transferee’s Sponsors shall have
defaulted under its obligations with respect to any Indebtedness in a manner
which is not reasonably acceptable to Lender;
 
(vii)         There shall be no material litigation or regulatory action pending
or threatened against any Transferee’s Sponsor, Transferee or any other Person
owned or Controlled, directly or indirectly, by Transferee’s Sponsors which is
not reasonably acceptable to Lender;
 
(viii)        Transferee and Transferee’s Sponsors shall, as of the date of such
Transfer, have an aggregate net worth and liquidity reasonably satisfactory to
Lender;
 
(ix)          Transferee and Transferee’s Sponsors (together with Transferee’s
proposed property manager) shall be experienced owners and operators of
properties similar in location, size, class, use, operation and value as the
Property, as evidenced by financial statements and other information reasonably
satisfactory to Lender (it being understood and agreed that Lender reserves the
right to approve Transferee without approving its proposed property manager);
 
(x)           If the Management Agreement (if any) will be terminated as a
result of such Transfer, the Property shall be managed by a Qualified Manager in
accordance with a Replacement Management Agreement;
 
(xi)          Transferee and Transferee’s SPE Constituent Entities shall have
delivered all agreements, certificates and opinions reasonably required by
Lender (including, if applicable, an amendment to Section 3.1.24 hereof to
incorporate necessary changes based on differences in the organizational
structures of Borrower and Transferee);
 
104

--------------------------------------------------------------------------------

(xii)         No Default or Event of Default shall occur as a result of such
Transfer;
 
(xiii)        Transferee shall have assumed all obligations of Borrower under
the Loan Documents pursuant to an assumption agreement in form and substance
reasonably satisfactory to Lender;
 
(xiv)        Borrower shall have delivered, at its sole cost and expense, an
endorsement to the Title Insurance Policy, as modified by the assumption
agreement, as a valid first lien on the Property and naming Transferee as owner
of the Property, which endorsement shall insure that, as of the date of the
recording of the assumption agreement, the Property shall not be subject to any
Liens other than those contained in the Title Insurance Policy issued on the
date hereof and the Permitted Encumbrances;
 
(xv)         Prior to any release of Guarantor, one (1) or more substitute
guarantors reasonably acceptable to Lender shall (A) have assumed all
obligations of Guarantor under the Guaranty and the Environmental Indemnity or
(B) have executed a replacement guaranty and a replacement environmental
indemnity in form and substance reasonably satisfactory to Lender;
 
(xvi)        Borrower or Transferee, at its sole cost and expense, shall have
delivered a new bankruptcy non-consolidation opinion reflecting such Transfer
reasonably acceptable to Lender and acceptable to the Rating Agencies;
 
(xvii)       If required by Lender, Borrower shall have delivered a Rating
Agency Confirmation as to such Transfer and Transferee;
 
(xviii)      The Ionis Lease permits the assignment and sale to Transferee and
following the proposed transfer and assumption, the Ionis Lease shall remain in
full force and effect;
 
(xix)         Borrower shall have paid to Lender an assumption fee equal to one
percent (1%) of the Outstanding Principal Balance; and
 
(xx)          Borrower shall have paid all reasonable out-of-pocket costs and
expenses incurred in connection with such Transfer (including reasonable fees
and disbursements of Lender’s counsel and fees, costs and expenses of the Rating
Agencies).
 
Upon such Transfer of the Property and assumption of the Loan, Borrower and
Guarantor shall be relieved of all liability under the Loan Documents for acts,
events, conditions, or circumstances first occurring or arising after the date
of such Transfer (other than with respect to any liabilities and obligations
that specifically stated to survive the repayment of the Loan), 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, and Borrower and Guarantor shall bear the burden of proof that
such acts, events, conditions, or circumstances first occurred or arose after
the date of such Transfer and/or that such acts, events, conditions, or
circumstances were not the proximate result of acts, events, conditions, or
circumstances that existed prior to the date of such Transfer, as applicable.
 
105

--------------------------------------------------------------------------------

Section 8.2.           Permitted Transfers of Interests in Borrower
 
8.2.1       Permitted Transfers Generally.
 
Notwithstanding anything to the contrary contained in Section 8.1 hereof,
Lender’s consent shall not be required in connection with (1) the Transfer or
issuance of shares of common stock in any Restricted Party that is a publicly
traded entity, provided such shares of stock are listed on the New York Stock
Exchange or another nationally recognized stock exchange located within the
United States, or (2) one or a series of Transfers, of not more than forty-nine
percent (49%) in the aggregate of the direct or indirect ownership interests in
any Restricted Party; provided that after giving effect to each such Transfer
described in clauses (1) and (2) above, the following conditions are satisfied:
(a) no Default or Event of Default shall have occurred and remain outstanding or
shall occur solely as a result of such Transfer, (b) such Transfer shall not (i)
cause the transferee, together with its Affiliates, to acquire Control of any
Restricted Party, (ii) result in Borrower no longer being Controlled by
Guarantor, or (iii) cause the transferee, together with its Affiliates, to
increase its direct or indirect interest in any Restricted Party to an amount
which exceeds forty-nine percent (49%) in the aggregate, (c) to the extent the
transferee owns twenty percent (20%) or more of the direct or indirect interests
in any Restricted Party immediately following such Transfer (provided that such
Transferee did not own 20% or more of the direct or indirect ownership interests
in such Restricted Party as of the Closing Date), Borrower shall deliver, at
Borrower’s sole cost and expense, customary searches (credit, judgment, lien,
bankruptcy, etc.) reasonably acceptable to Lender with respect to such
transferee and its Affiliates as Lender may reasonably require, (d) after giving
effect to such Transfer, Guarantor shall continue to own, directly or
indirectly, at least fifty- one percent (51%) of all legal, beneficial and
economic interests in each Restricted Party, (e) the Property shall continue to
be self-managed by Borrower in accordance with the terms of this Agreement or
managed by a Qualified Manager, (f) Borrower shall give Lender notice of such
Transfer request, together with copies of all instruments effecting such
Transfer and copies of any Organizational Documents that Lender shall require,
not less than thirty (30) days prior to the proposed date of such Transfer, (g)
Borrower shall continue to comply with the representations, warranties and
covenants contained in Sections 3.1.41, 4.1.25, 4.2.10 and 4.2.14 hereof (and
upon request of Lender, deliver to Lender a statement signed by an authorized
officer of Borrower which certifies to such compliance), and (h) the legal and
financial structure of Borrower and its stockholders, partners or members, as
applicable, and the single purpose nature and bankruptcy remoteness of Borrower
and its stockholders, partners or members, as applicable, after such Transfer,
shall satisfy Lender’s the then current applicable underwriting criteria and
requirements.
 
106

--------------------------------------------------------------------------------

8.2.2       Permitted Merger.
 
Additionally, notwithstanding anything to the contrary contained in Section 8.1
or Section 8.2.1 hereof, Lender’s consent shall not be required in connection
with a Permitted Merger of Ionis.  As used herein, the term “Permitted Merger”
shall mean an acquisition by, merger with or consolidation with or into (any
such transaction, the “Merger”) an entity (the “Merged Entity”) in which each of
the following conditions have been satisfied as of the date of consummation of
the Merger: (a) after giving effect to such Merger, no Default or Event of
Default shall have occurred and remain outstanding or shall occur solely as a
result of such Merger; (b) [reserved]; (c) to the extent any transferee owns
twenty percent (20%) or more of the direct or indirect interests in any
Restricted Party immediately following such Merger (provided that such
transferee did not own 20% or more of the direct or indirect ownership interests
in such Restricted Party as of the Closing Date), Borrower shall deliver, at
Borrower’s sole cost and expense, customary searches (credit, judgment, lien,
bankruptcy, etc.) reasonably acceptable to Lender with respect to such
transferee and its Affiliates as Lender may reasonably require; (d) [reserved];
(e) the Property shall continue to be self-managed by Borrower in accordance
with the terms of this Agreement or managed by a Qualified Manager; (f) Borrower
shall give Lender notice of such Merger, together with copies of all instruments
effecting such Merger and copies of any Organizational Documents that Lender
shall require, not less than fifteen (15) days prior to the proposed closing
date of such Merger; (g) after giving effect to such Merger, Borrower shall
continue to comply with the representations, warranties and covenants contained
in Sections 3.1.41, 4.1.25, 4.2.10 and 4.2.14 hereof (and upon request of
Lender, deliver to Lender a statement signed by an authorized officer of
Borrower which certifies to such compliance); (h) after giving effect to such
Merger, the legal and financial structure of Borrower and the single purpose
nature and bankruptcy remoteness of Borrower shall satisfy Lender’s the then
current applicable underwriting criteria and requirements; (i) the Merged Entity
(after giving effect to such Merger) has a credit rating of Investment Grade or
better; (j) the Merged Entity is a reputable pharmaceutical company; (k) after
giving effect to such Merger, the Merged Entity owns, directly or indirectly,
all or substantially all of the assets which Ionis owned immediately prior to
the effective date of the Merger; (l) the Merged Entity immediately following
such Merger (and after giving effect to such Merger) shall have an aggregate Net
Worth of not less than $600,000,000.00 and Liquid Assets of not less than
$250,000,000.00; (m) the Merged Entity shall have assumed all obligations of
Ionis, as tenant, under the Ionis Lease; (n) the Merged Entity have assumed all
obligations of Guarantor under the Guaranty and the Environmental Indemnity or
have executed a replacement guaranty and a replacement environmental indemnity
in substantially the same form as the Guaranty and Environmental Indemnity; (o)
Borrower shall have obtained a Rating Agency Confirmation from the Rating
Agencies with respect to such Merger; and (p) Borrower shall have paid all
reasonable out-of-pocket costs and expenses incurred in connection with such
Merger (including reasonable fees and disbursements of Lender’s counsel and
fees, costs and expenses of the Rating Agencies).
 
107

--------------------------------------------------------------------------------

8.2.3       Corporate Transfer.
 
Furthermore, notwithstanding anything to the contrary contained in Section 8.1
or Section 8.2.1 hereof, Lender’s consent shall not be required in connection
with a Transfer of not more than fifty percent (50%) in the aggregate of the
direct or indirect ownership interests in a Restricted Party to an entity (the
“New Entity”), provided all of the following conditions have been satisfied as
of the date of consummation of such Transfer: (a) after giving effect to such
Transfer, no Default or Event of Default shall have occurred and remain
outstanding or shall occur solely as a result of such Transfer; (b) after giving
effect to such Transfer, Ionis will own, directly or indirectly, at least fifty
percent (50%) of the direct ownership interests in such New Entity; (c) to the
extent any transferee owns twenty percent (20%) or more of the direct or
indirect interests in any Restricted Party immediately following such Transfer
(provided that such transferee did not own 20% or more of the direct or indirect
ownership interests in such Restricted Party as of the Closing Date), Borrower
shall deliver, at Borrower’s sole cost and expense, customary searches (credit,
judgment, lien, bankruptcy, etc.) reasonably acceptable to Lender with respect
to such transferee and its Affiliates as Lender may reasonably require; (d)
[reserved]; (e) the Property shall continue to be self-managed by Borrower in
accordance with the terms of this Agreement or managed by a Qualified Manager;
(f) Borrower shall give Lender notice of such Transfer, together with copies of
all instruments effecting such Transfer and copies of any Organizational
Documents that Lender shall require, not less than fifteen (15) days prior to
the proposed effective date of such Transfer; (g) after giving effect to such
Transfer, Borrower shall continue to comply with the representations, warranties
and covenants contained in Sections 3.1.41, 4.1.25, 4.2.10 and 4.2.14 hereof
(and upon request of Lender, deliver to Lender a statement signed by an
authorized officer of Borrower which certifies to such compliance); (h) after
giving effect to such Transfer, the legal and financial structure of Borrower
and the single purpose nature and bankruptcy remoteness of Borrower shall
satisfy Lender’s the then current applicable underwriting criteria and
requirements; (i) the New Entity (after giving effect to such Transfer) has a
credit rating of Investment Grade or better; (j) the New Entity is a reputable
pharmaceutical company; (k) after giving effect to such Transfer, the New Entity
will own a significant amount of assets previously owned by Ionis immediately
prior to such Transfer; (l) the New Entity immediately following such Transfer
(and after giving effect to such Transfer) shall have an aggregate Net Worth of
not less than $600,000,000.00 and Liquid Assets of not less than
$250,000,000.00; (m) the New Entity shall have assumed all obligations of Ionis,
as tenant, under the Ionis Lease; (n) the New  Entity have assumed all
obligations of Guarantor under the Guaranty and the Environmental Indemnity or
have executed a replacement guaranty and a replacement environmental indemnity
in substantially the same form as the Guaranty and Environmental Indemnity; (o)
Borrower shall have obtained a Rating Agency Confirmation from the Rating
Agencies with respect to such Transfer; and (p) Borrower shall have paid all
reasonable out-of-pocket costs and expenses incurred in connection with such
Transfer (including reasonable fees and disbursements of Lender’s counsel and
fees, costs and expenses of the Rating Agencies).
 
8.2.4      Prohibited Entity.
 
Notwithstanding anything to the contrary contained herein or in any other Loan
Document, in no event shall Borrower be (I) a Prohibited Entity, (II) Controlled
(directly or indirectly) by any Prohibited Entity or (II) more than 49% owned
(directly or indirectly) by any Prohibited Entity (whether individually or in
the aggregate), unless, in the case of each of the foregoing, Lender’s prior
written consent is first obtained (which such consent shall be given or withheld
in Lender’s sole discretion and may be conditioned on, among other things,
Lender’s receipt of a Rating Agency Confirmation).
 
Section 8.3.         Insolvency Opinion.
 
Notwithstanding anything in this Agreement to the contrary, if after giving
effect to any Transfer (including, without limitation, a Permitted Transfer and
Transfers contemplated under Sections 8.2.2 and 8.2.3), more than forty-nine
percent (49%) in the aggregate of direct and/or indirect interests in Borrower
are owned by any Person and its Affiliates that owned less than forty-nine
percent (49%) direct or indirect interest in Borrower as of the Closing Date,
Borrower shall deliver to Lender prior to the effective date of such Transfer an
updated Insolvency Opinion reasonably acceptable to Lender and acceptable to the
Rating Agencies.
 
108

--------------------------------------------------------------------------------

IX.          SALE AND SECURITIZATION OF MORTGAGE
 
Section 9.1.         Sale of Mortgage and Securitization.
 
(a)          Lender shall have the right (i) to sell or otherwise transfer the
Loan as a whole loan or sell or otherwise transfer any portion thereof or any
interest therein, (ii) to sell participation interests in the Loan or (iii) to
securitize the Loan or any portion thereof or any interest therein in one or
more private or public securitizations.  (The transactions referred to in
clauses (i), (ii) and (iii) are each hereinafter referred to as a “Secondary
Market Transaction” and the transaction referred to in clause (iii) shall
hereinafter be referred to as a “Securitization.”  Any certificates, notes or
other securities issued in connection with a Securitization are hereinafter
referred to as “Securities.”)
 
(b)          If requested by Lender, Borrower shall assist Lender in satisfying
the market standards to which Lender customarily adheres or which may be
required in the marketplace, by the Rating Agencies or by any Legal Requirements
in connection with any Secondary Market Transactions (including, without
limitation, any Exchange Act Filings or any report that is required to be made
“available” to holders of the Securities under Regulation AB or applicable Legal
Requirements), including, without limitation, to:
 
(i)           (A) provide updated financial and other information with respect
to the Property, the business operated at the Property, Borrower, Guarantor, any
Affiliate of Borrower or Guarantor and Manager (including, without limitation,
the information set forth on Schedule 9.1(b) hereto), (B) provide updated
budgets and rent rolls (including itemized percentage of floor area occupied and
percentage of aggregate base rent for each Tenant) relating to the Property and
(C) provide updated appraisals, market studies, environmental audits, reviews
and reports (Phase I’s and, if appropriate, Phase II’s), property condition
reports and other due diligence investigations of the Property (the information
required under clauses (A), (B) and (C) shall hereinafter be referred to
collectively as the “Updated Information”), together with appropriate
verification of the Updated Information through letters of auditors,
certificates of third party providers or opinions of counsel acceptable to
Lender and the Rating Agencies;
 
(ii)          provide opinions of counsel, which may be relied upon by Lender,
the NRSROs and their respective counsel, agents and representatives, as to
bankruptcy non-consolidation, fraudulent conveyance, and “true lease”, “true
sale” or any other opinion customary in Secondary Market Transactions or
required by the Rating Agencies with respect to the Property, Borrower,
Guarantor and any Affiliate of Borrower or Guarantor, which counsel and opinions
shall be satisfactory to Lender and the Rating Agencies;
 
(iii)         provide, and cause to be provided, updated representations and
warranties made in the Loan Documents and make, and cause to be made, such
additional representations and warranties as may be requested by Lender or the
Rating Agencies and consistent with the facts covered by such representations
and warranties as they exist on the date thereof;
 
109

--------------------------------------------------------------------------------

(iv)          execute, and cause to be executed, such amendments, replacements
or other modifications to Borrower’s Organizational Documents or the Loan
Documents as may be requested by Lender or the Rating Agencies to effect the
Secondary Market Transactions, including, without limitation, (A) to amend
and/or supplement the Independent Director provisions provided herein and
therein, in each case, in accordance with the applicable requirements of the
Rating Agencies; provided, however, that Borrower shall not be required to
amend, restate or otherwise modify any Loan Document if such amendment,
restatement or other modification would (A) increase the initial weighted
average interest rate or change the amortization of principal set forth herein
or in the Note (except that the weighted average interest rate or the
amortization of principal may subsequently change due to involuntary prepayments
or if an Event of Default shall occur) or (B) amend or otherwise modify any
other material economic term of the Loan; and
 
(v)           attend management meetings with respect to Borrower or the
Property, provide access to the Property and conduct tours of the Property; and
 
(vi)          provide, and cause to be provided, certificates or other evidence
of reliance satisfactory to Lender and the Rating Agencies with respect to any
information or third party reports obtained in connection with the origination
of the Loan or any Updated Information from Borrower, Guarantor, any Affiliate
of Borrower or Guarantor, Manager and any accountants, appraisers, engineers,
environmental assessment experts and other experts or third party providers of
such information, reports or Updated Information.
 
(c)           If, at the time one or more Disclosure Documents are being
prepared for or in connection with a Securitization, Lender expects that
Borrower alone or Borrower and one or more Affiliates of Borrower (including any
guarantor or other Person that is directly or indirectly committed by contract
or otherwise to make payments on all or a part of the Loan) collectively, or the
Property alone or the Property and Related Properties collectively, will be a
Significant Obligor, Borrower shall furnish to Lender upon request the following
financial information:
 
(i)            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
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 in the Securitization, net operating income for the Property and the
Related Properties for the most recent Fiscal Year and interim period as
required under Item 1112(b)(1) of Regulation AB (or, if the Loan is not treated
as a non-recourse loan under Instruction 3 for Item 1101(k) of Regulation AB,
selected financial data meeting the requirements and covering the time periods
specified in Item 301 of Regulation S-K and Item 1112(b)(1) of Regulation AB),
or
 
110

--------------------------------------------------------------------------------

(ii)            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
equal or exceed twenty percent (20%) of the aggregate principal amount of all
mortgage loans included or expected to be included in the Securitization, the
financial statements required under Item 1112(b)(2) of Regulation AB (which
includes, but may not be limited to, a balance sheet with respect to the entity
that Lender determines to be a Significant Obligor for the two most recent
Fiscal Years and applicable interim periods, meeting the requirements of Rule
3-01 of Regulation S-X, and statements of income and statements of cash flows
with respect to the Property for the three most recent Fiscal Years and
applicable interim periods, meeting the requirements of Rule 3-02 of Regulation
S-X (or if Lender determines that the Property is the Significant Obligor and
the Property (other than properties that are hotels, nursing homes, or other
properties that would be deemed to constitute a business and not real estate
under Regulation S-X or other legal requirements) was acquired from an
unaffiliated third party and the other conditions set forth in Rule 3-14 of
Regulation S-X have been met, the financial statements required by Rule 3-14 of
Regulation S-X)).
 
(d)           Further, if requested by Lender, Borrower shall, promptly upon
Lender’s request, furnish to Lender financial data or financial statements
meeting the requirements of Item 1112(b)(1) or (2) of Regulation AB, as
specified by Lender, for any tenant of the Property if, in connection with a
Securitization, Lender expects there to be, as of the cut-off date for such
Securitization, a concentration with respect to such tenant or group of
Affiliated tenants within all of the mortgage loans included or expected to be
included in the Securitization such that such tenant or group of Affiliated
tenants would constitute a Significant Obligor. Borrower shall furnish to
Lender, on an ongoing basis, financial data or financial statements with respect
to such tenants meeting the requirements of Item 1112(b)(1) or (2) of Regulation
AB, as specified by Lender, but only for so long as such entity or entities are
a Significant Obligor and either (i) Exchange Act Filings in connection with or
relating to the Securitization are required to be made under applicable Legal
Requirements or (ii) comparable information is required to otherwise be
“available” to holders of the Securities under Regulation AB or applicable Legal
Requirements.
 
(e)           If Lender reasonably determines that Borrower alone or Borrower
and one or more Affiliates of any Borrower collectively, or the Property alone
or the Property and Related Properties collectively, are a Significant Obligor,
then Borrower shall furnish to Lender, on an ongoing basis, selected financial
data or financial statements meeting the requirements of Item 1112(b)(1) or (2)
of Regulation AB, as specified by Lender, but only for so long as such entity or
entities are a Significant Obligor and either (i) Exchange Act Filings are
required to be made under applicable Legal Requirements or (ii) comparable
information is required to otherwise be “available” to holders of the Securities
under Regulation AB or applicable Legal Requirements.
 
(f)            Any financial data or financial statements provided pursuant to
this Section 9.1 shall be furnished to Lender within the following time periods:
 
(i)            with respect to information requested in connection with the
preparation of Disclosure Documents for a Securitization, within ten (10)
Business Days after notice from Lender; and
 
111

--------------------------------------------------------------------------------

(ii)           with respect to ongoing information required under Sections
9.1(d) and (e) above, (A) not later than thirty (30) days after the end of each
fiscal quarter of Borrower and (B) not later than seventy-five (75) days after
the end of each Fiscal Year of Borrower.
 
(g)           All financial data and financial statements provided by Borrower
hereunder pursuant to Sections 9.1(c), (d), (e) and (f) hereof shall be prepared
in accordance with GAAP (or such other accounting basis reasonably acceptable to
Lender) and, if applicable, shall meet the requirements of Regulation S-K or
Regulation S-X, as applicable, Regulation AB, and any and all other applicable
Legal Requirements.  All financial statements relating to a Fiscal Year shall be
audited by independent accountants of Borrower reasonably acceptable to Lender
in accordance with generally accepted auditing standards, Regulation S-X or
Regulation S-K, as applicable, Regulation AB, and all other applicable Legal
Requirements, shall be accompanied by the manually executed report of the
independent accountants thereon, which report shall meet the requirements of
Regulation S-K or Regulation S-X, as applicable, Regulation AB, and all other
applicable Legal Requirements, and shall be further accompanied by a manually
executed consent of the independent accountants, in form and substance
reasonably acceptable to Lender, to the inclusion of such financial statements
in any Disclosure Document, any Exchange Act Filing or any report that is
required to be made “available” to holders of the Securities under Regulation AB
or applicable Legal Requirements and to the use of the name of such independent
accountants and the reference to such independent accountants as “experts” in
any Disclosure Document, any Exchange Act Filing or any report that is required
to be made “available” to holders of the Securities under Regulation AB or
applicable Legal Requirements, all of which shall be provided at the same time
as the related financial statements are required to be provided.  All other
financial data and financial statements (audited or unaudited) provided by
Borrower shall be accompanied by an Officer’s Certificate which shall state that
such financial data and financial statements meet the requirements set forth in
the first sentence of this paragraph.
 
(h)           In the event Lender reasonably determines, in connection with a
Securitization, that financial statements and financial data required in order
to comply with Regulation AB or any amendment, modification or replacement
thereto or any other Legal Requirements are other than as provided herein, then
notwithstanding the foregoing provisions of this Section 9.1, Lender may
request, and Borrower shall promptly provide, such other financial statements
and financial data as Lender reasonably determines to be necessary or
appropriate for such compliance.
 
(i)             Without limiting the generality of Section 9.1(h) above, if
requested by Lender, Borrower shall promptly provide Lender with any financial
statements or financial, statistical, operating or other information as Lender
shall determine to be required pursuant to Regulation AB or any amendment,
modification or replacement thereto or any other Legal Requirements in
connection with any Disclosure Document, any Exchange Act Filing or any report
that is required to be made “available” to holders of the Securities under
Regulation AB or applicable Legal Requirements or as shall otherwise be
reasonably requested by Lender.
 
(j)            Borrower agrees that Lender may disclose any information relating
to Borrower, its Affiliates, the Property or any aspect of the Loan (including
information provided by or on behalf of Borrower or any of its Affiliates to
Lender) to the parties requesting such information and, if applicable, the
NRSROs in connection with any Secondary Market Transaction.  Borrower also
understands that the findings and conclusions of any third-party due diligence
report obtained by Lender or other Securitization Indemnified Parties may be
made publicly available if required, and in the manner prescribed, by Section
15E(s)(4)(A) of the Exchange Act, any rules promulgated thereunder or any other
applicable Legal Requirements.
 
112

--------------------------------------------------------------------------------

(k)           In connection with Lender’s efforts to effect any Secondary Market
Transaction, all reasonable, out-of-pocket third party costs and expenses
incurred by Borrower and Guarantor on or prior to the closing of such Secondary
Market Transaction pursuant to this Section 9.1 (including, without limitation,
the fees and expenses of the Rating Agencies but excluding Borrower and
Guarantor’s own legal fees) shall be reimbursed by Lender.
 
Section 9.2.          Securitization Indemnification.
 
(a)           Borrower understands that information provided to Lender by
Borrower or its agents, counsel and representatives may be included in
Disclosure Documents in connection with a Securitization and may also be
included in filings with the Securities and Exchange Commission pursuant to the
Securities Act of 1933, as amended (the “Securities Act”), or the Securities and
Exchange Act of 1934, as amended (the “Exchange Act”), and may be made available
to investors or prospective investors in the Securities, the NRSROs and other
advisory and service providers relating to a Securitization.  In the event that
any Disclosure Document is required to be revised prior to the sale of all
Securities in connection with a Securitization, Borrower will cooperate with
Lender (or, if applicable, the holder of the applicable interest in the Loan) in
updating the Disclosure Document by providing all current information necessary
to keep the Disclosure Document accurate and complete in all material respects.
 
(b)           Borrower hereby agrees to indemnify Lender, UBSRESI, any Affiliate
of UBSRESI that has filed any registration statement relating to the
Securitization or has acted as the issuer, the sponsor or depositor in
connection with a Securitization, any Affiliate of UBSRESI that acts as an
underwriter, placement agent or initial purchaser of the Securities issued in
connection with a Securitization, any other issuers, depositors, underwriters,
placement agents or initial purchasers of the Securities issued in connection
with a Securitization, and each of their respective directors, officers,
partners, employees, representatives, agents and Affiliates, and each Person
that controls any such Person within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act (collectively, the “Securitization
Indemnified Parties”) for any liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, claims, costs and expenses (collectively,
the “Securitization Indemnification Liabilities”) to which any Securitization
Indemnified Party may become subject insofar as the Securitization
Indemnification Liabilities arise out of or are based upon (i) any untrue
statement or alleged untrue statement of any material fact contained in the
information provided to Lender by Borrower, any Affiliate of Borrower or any of
their respective agents, counsel or representatives, (ii) the omission or
alleged omission to state therein a material fact required to be stated in such
information or necessary in order to make the statements in such information, in
light of the circumstances under which they were made, not misleading, and (iii)
a breach of the representations and warranties made by Borrower in Section
3.1.34 of this Agreement.  Borrower also agrees to reimburse each Securitization
Indemnified Party for any legal or other costs and expenses reasonably incurred
by such Securitization Indemnified Party in connection with investigating or
defending the Securitization Indemnification Liabilities.  Borrower’s liability
under this paragraph will be limited to any such liability, obligation, loss,
damage, penalty, action, judgment, suit, claim, cost or expense that arises out
of or is based upon an  untrue statement or omission made therein in reliance
upon and in conformity with information furnished by or on behalf of Borrower in
connection with the preparation of the Disclosure Documents or in connection
with the underwriting or closing of the Loan (including, without limitation,
financial statements of Borrower, operating statements and rent rolls with
respect to the Property).  This indemnity provision will be in addition to any
obligation or liability which Borrower may otherwise have.
 
113

--------------------------------------------------------------------------------

(c)           In connection with Exchange Act Filings and information therein or
other reports containing comparable information that are required to be made
“available” to holders of the Securities under Regulation AB or applicable Legal
Requirements, as it relates to the Property, Borrower, Guarantor, any Affiliate
of Borrower or Guarantor, Manager (if any) or any other aspect of the Loan,
Borrower agrees to (i) indemnify the Securitization Indemnified Parties for
Securitization Indemnification Liabilities to which any Securitization
Indemnified Party may become subject insofar as the Securitization
Indemnification Liabilities arise out of, or are based upon, an untrue statement
or omission made in reliance upon, and in conformity with, information furnished
to Lender by or on behalf of Borrower in connection with the preparation of the
Disclosure Document, in connection with the underwriting or closing of the Loan
or any of the reports, statements or other information furnished by or on behalf
of Borrower pursuant to the terms of this Agreement, including financial
statements of Borrower, operating statements and rent rolls with respect to the
Property, and (ii) reimburse each Securitization Indemnified Party for any legal
or other costs and expenses reasonably incurred by such Securitization
Indemnified Party in connection with defending or investigating the
Securitization Indemnification Liabilities.
 
(d)           Promptly after receipt by a Securitization Indemnified Party of
notice of any claim or the commencement of any action or suit, such
Securitization Indemnified Party shall, if a claim for indemnification in
respect thereof is to be made against Borrower, notify Borrower in writing of
the claim or the commencement of such action or suit; provided, however, that
the failure to notify Borrower shall not relieve Borrower from any liability
which it may have under the indemnification provisions of this Section 9.2
except to the extent that it has been materially prejudiced by such failure and,
provided further that the failure to notify Borrower shall not relieve Borrower
from any liability which it may have to any Securitization Indemnified Party
otherwise than under the provisions of this Section 9.2.  If any such claim,
action or suit shall be brought against any Securitization Indemnified Party,
and it shall notify Borrower thereof, Borrower shall be entitled to participate
therein and, to the extent that it wishes, assume the defense thereof with
counsel reasonably satisfactory to such Securitization Indemnified Party.  After
notice from Borrower to the applicable Securitization Indemnified Party of
Borrower’s election to assume the defense of such claim, action or suit,
Borrower shall not be liable to such Securitization Indemnified Party for any
legal or other costs and expenses subsequently incurred by such Securitization
Indemnified Party in connection with the defense thereof except as provided in
the following sentence; provided, however, if the defendants in any such action
or suit include both Borrower, on the one hand, and one or more Securitization
Indemnified Parties on the other hand, and a Securitization Indemnified Party
shall have reasonably concluded that there are legal defenses available to it
and/or other Securitization Indemnified Parties that are different or in
addition to those available to Borrower, the Securitization 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 or suit on
behalf of such Securitization Indemnified Party or Parties.  The Securitization
Indemnified Party shall instruct its counsel to maintain reasonably detailed
billing records for fees and disbursements for which such Securitization
Indemnified Party is seeking or intends to seek reimbursement hereunder and
shall submit copies of such detailed billing records to substantiate that such
counsel’s fees and disbursements are related solely to the defense of a claim
for which Borrower is required hereunder to indemnify such Securitization
Indemnified Party.  Borrower shall not be liable for the costs and expenses of
more than one (1) such separate counsel unless a Securitization 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
Securitization Indemnified Party.
 
114

--------------------------------------------------------------------------------

(e)           Without the prior written consent of the applicable Securitization
Indemnified Party (which consent shall not be unreasonably withheld or delayed),
Borrower shall not settle or compromise or consent to the entry of any judgment
in any pending or threatened claim, action, suit or proceeding in respect of
which indemnification may be sought hereunder (whether or not any Securitization
Indemnified Party is an actual or potential party to such claim, action, suit or
proceeding) unless Borrower shall have given the applicable Securitization
Indemnified Party reasonable prior notice thereof and shall have obtained an
unconditional release of each Securitization Indemnified Party from all
Securitization Indemnification Liabilities arising out of or relating to such
claim, action, suit or proceeding.  As long as Borrower has complied with its
obligations to defend and indemnify hereunder, Borrower shall not be liable for
any settlement made by any Securitization Indemnified Party without the consent
of Borrower (which consent shall not be unreasonably withheld or delayed).
 
(f)            Borrower agrees that if any indemnification or reimbursement
sought pursuant to this Section 9.2 is finally judicially determined to be
unavailable for any reason or is insufficient to hold any Securitization
Indemnified Party harmless (with respect only to the Securitization
Indemnification Liabilities that are the subject of this Section 9.2), then
Borrower, on the one hand, and such Securitization Indemnified Party, on the
other hand, shall contribute to the Securitization Indemnification Liabilities
for which such indemnification or reimbursement is held unavailable or is
insufficient:  (i) in such proportion as is appropriate to reflect the relative
benefits to Borrower, on the one hand, and such Securitization Indemnified
Party, on the other hand, from the transactions to which such indemnification or
reimbursement relates; or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative faults of Borrower, on the one hand, and all Securitization Indemnified
Parties, on the other hand, as well as any other equitable considerations. 
Notwithstanding the provisions of this Section 9.2, (A) no Person found liable
for a fraudulent misrepresentation shall be entitled to contribution from any
other Person who is not also found liable for such fraudulent misrepresentation,
and (B) Borrower agrees that in no event shall the amount to be contributed by
the Securitization Indemnified Parties collectively pursuant to this Section
9.2(f) exceed the amount of the fees actually received by the Securitization
Indemnified Parties in connection with the closing of the Loan.
 
115

--------------------------------------------------------------------------------

(g)           Borrower agrees that the indemnification, contribution and
reimbursement obligations set forth in this Section 9.2 shall apply whether or
not any Securitization Indemnified Party is a formal party to any claim, action,
suit or proceeding.  Borrower further agrees that the Securitization Indemnified
Parties are intended third party beneficiaries under this Section 9.2.
 
(h)           The liabilities and obligations of Borrower and the Securitization
Indemnified Parties under this Section 9.2 shall survive the termination of this
Agreement and the satisfaction and discharge of the Debt.
 
X.            DEFAULTS
 
Section 10.1.        Event of Default.
 
(a)           Each of the following events shall constitute an event of default
hereunder (an “Event of Default”):
 
(i)            (A) if any monthly Debt Service, any monthly deposit of Reserve
Funds or the payment due on the Maturity Date is not paid when due or (B) if any
other portion of the Debt is not paid when due; provided that, with respect to
this clause (B), such non-payment continues for five (5) days following notice
to Borrower that the same is due and payable;
 
(ii)           if any of the Taxes or Other Charges are not paid when due;
 
(iii)          if the Policies are not kept in full force and effect;
 
(iv)          if Borrower commits, permits or suffers a Transfer in violation of
the provisions of this Agreement or Article 6 of the Security Instrument;
 
(v)           if any certification, representation or warranty made by Borrower
herein or in any other Loan Document, or in any report, certificate, financial
statement or other instrument, agreement or document furnished to Lender shall
have been false or misleading in any material respect as of the date such
certification, representation or warranty was made;
 
(vi)          (A) if Borrower or Sole Member shall make an assignment for the
benefit of creditors or (B) if Guarantor shall make an assignment for the
benefit of creditors;
 
(vii)         (A) if Borrower or Sole Member fails or admits its inability to
pay debts generally as they become due or (B) if, Guarantor fails or admits its
inability to pay debts generally as they become due;
 
116

--------------------------------------------------------------------------------

(viii)       (A) if a receiver, liquidator or trustee shall be appointed for
Borrower or Sole Member or if Borrower or Sole Member shall be adjudicated as
bankrupt or insolvent, or if any petition for bankruptcy, reorganization or
arrangement pursuant to federal bankruptcy law, or any similar federal or state
law, shall be filed by or against, consented to, or acquiesced in by, Borrower
or Sole Member, or if any proceeding for the dissolution or liquidation of
Borrower or Sole Member shall be instituted; provided, however, if such
appointment, adjudication, petition or proceeding was involuntary and not
consented to by Borrower or Sole Member, upon the same not being discharged,
stayed or dismissed within sixty (60) days, or (B) if a receiver, liquidator or
trustee shall be appointed for Guarantor or if Guarantor shall be adjudicated as
bankrupt or insolvent, or if any petition for bankruptcy, reorganization or
arrangement pursuant to federal bankruptcy law, or any similar federal or state
law, shall be filed by or against, consented to, or acquiesced in by, Guarantor,
or if any proceeding for the dissolution or liquidation of Guarantor shall be
instituted; provided, however, if such appointment, adjudication, petition or
proceeding was involuntary and not consented to by Guarantor, upon the same not
being discharged, stayed or dismissed within sixty (60) days or if an order for
relief is entered
 
(ix)          if Borrower or Guarantor attempts to assign its rights under this
Agreement or any of the other Loan Documents or any interest herein or therein
in contravention of the Loan Documents;
 
(x)           if Borrower shall be in default beyond any applicable cure periods
under any agreement (other than the Loan Documents) creating a Lien on the
Property or any part thereof;
 
(xi)          with respect to any term, covenant or provision set forth herein
which specifically contains a notice requirement or grace period, if Borrower
shall be in default under such term, covenant or condition after the giving of
such notice and the expiration of such grace period;
 
(xii)         if Borrower shall continue to be in Default under any of the
terms, covenants or provisions set forth in Section 9.1, Section 11.29 or
Section 11.30 hereof, or fails to cooperate with Lender in connection with a
Secondary Market Transaction in accordance with the terms, covenants and
provisions set forth in Section 9.1 hereof, for three (3) days after notice to
Borrower from Lender;
 
(xiii)        if any of the assumptions contained in any Insolvency Opinion is
or shall become untrue in any material respect;
 
(xiv)        if Borrower breaches any representation, warranty or covenant
contained in Section 3.1.24 hereof;
 
(xv)         (A) if a breach or default by Borrower under any condition or
obligation contained in any Operating Agreement is not cured within any
applicable cure period provided therein, (B) if there occurs any event or
condition that gives any party to any Operating Agreement (other than Borrower)
the right to terminate or cancel such Operating Agreement and such event or
condition is not cured within any applicable cure period under such Operating
Agreement, or (C) if any Operating Agreement is terminated or cancelled without
Lender’s prior consent, the termination of cancellation of which could result in
a Material Adverse Effect as reasonably determined by Lender, or (D) if any of
the terms, covenants or conditions of any Operating Agreement shall in any
manner be modified, changed, supplemented, altered, or amended without Lender’s
prior consent, which modification, change, supplementation, alteration or
amendment, in each case, could result in a Material Adverse Effect as reasonably
determined by Lender;
 
117

--------------------------------------------------------------------------------

(xvi)        if a material default has occurred and continues beyond any
applicable cure period under the Management Agreement (if any) and such default
permits Manager thereunder to terminate or cancel the Management Agreement;
 
(xvii)       if a default (beyond all applicable notice and cure periods) occurs
under the Ionis Lease or any replacement Lease entered into in accordance with
the terms of this Agreement;
 
(xviii)      if Borrower shall continue to be in Default under any of the other
terms, covenants or conditions of this Agreement not specified in clauses (i) to
(xvii) above, for ten (10) days after notice to Borrower 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, however, that if such non-monetary Default is susceptible of cure but
cannot reasonably be cured within such thirty (30) day period and provided
further that 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 such time as is
reasonably necessary for Borrower in the exercise of due diligence to cure such
Default, such additional period not to exceed sixty (60) days; or
 
(xix)         if there shall be Default under any of the other Loan Documents
beyond any applicable cure periods contained in such Loan Documents, whether as
to Borrower, Guarantor or the Property, or if any other such event shall occur
or condition shall exist, if the effect of such event or condition is to
accelerate the maturity of any portion of the Debt or to permit Lender to
accelerate the maturity of all or any portion of the Debt.
 
(b)           Upon the occurrence of an Event of Default (other than an Event of
Default described in Section 10.1(a)(vi), (vii) or (viii) 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 and to 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 10.1(a)(vi), (vii) or (viii)
above, the Debt 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.
 
118

--------------------------------------------------------------------------------

Section 10.2.        Remedies.
 
(a)           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 portion
of the Debt shall be declared due and payable, and whether or not Lender shall
have commenced any foreclosure proceeding or initiated or taken other action for
the enforcement of its rights and remedies under any of the Loan Documents with
respect to all or any part of the Property.  Any such actions taken by Lender
shall be cumulative and concurrent and may be pursued independently, singly,
successively, together or otherwise, at such time and in such order as Lender
may determine in its sole and absolute 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.  Without limiting the generality of the
foregoing, Borrower agrees that, if an Event of Default has occurred and remains
outstanding, to the extent not prohibited by applicable laws (i) Lender is not
subject to any “one action” or “election of remedies” law or rule, and (ii) all
liens and other rights, remedies or privileges provided to Lender shall remain
in full force and effect until Lender has exhausted all of its rights and
remedies against the Property and the Security Instrument has been foreclosed,
sold and/or otherwise realized upon in satisfaction of the Obligations or the
Debt has been paid in full.
 
(b)           With respect to Borrower and the Property, nothing contained
herein or in any other Loan Document shall be construed as requiring Lender to
resort to the Property for the satisfaction of any of the Debt in any order,
proportion or priority, and Lender may seek satisfaction out of the Property, or
any part thereof, in its sole and absolute discretion in respect of the Debt. 
In addition, Lender shall have the right from time to time to partially
foreclose the Security Instrument in any manner and for any amounts secured by
the Security Instrument then due and payable as determined by Lender in its sole
and absolute discretion including, without limitation, the following
circumstances:  (i) in the event Borrower defaults beyond any applicable grace
period in the payment of one or more scheduled payments of principal and
interest, Lender may foreclose the Security Instrument to recover such
delinquent payments or (ii) in the event Lender elects to accelerate less than
the entire Outstanding Principal Balance, Lender may foreclose the Security
Instrument to recover so much of the principal balance of the Loan as Lender may
accelerate and such other sums secured by the Security Instrument as Lender may
elect.  Notwithstanding one or more partial foreclosures, the Property shall
remain subject to the Security Instrument to secure payment of sums secured by
the Security Instrument and not previously recovered.
 
(c)           Upon the occurrence of an Event of Default (but without limiting
Lender’s rights under Section 9.1, Section 11.29 or Section 11.30 hereof),
Lender shall have the right from time to time to sever the Note and the other
Loan Documents into one or more separate notes, mortgages and other security
documents (collectively, the “Severed Loan Documents”) in such denominations and
priority as Lender shall determine in its sole and absolute discretion for
purposes of evidencing and enforcing its rights and remedies provided
hereunder.  Borrower shall execute and deliver to Lender from time to time,
promptly after the request of Lender, a severance agreement and such other
documents as Lender shall request in order to effect the severance described in
the preceding sentence, all in form and substance reasonably satisfactory to
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 the aforesaid severance,
Borrower ratifying all that its said attorney shall do by virtue thereof;
provided, however, Lender shall not make or execute any such documents under
such power until three (3) days after notice has been given to Borrower by
Lender of Lender’s intent to exercise its rights under such power.  Borrower
shall be obligated to pay any costs or expenses incurred in connection with the
preparation, execution, recording or filing of the Severed Loan Documents and
other matters and documentation in connection therewith.  The Severed Loan
Documents shall not contain any representations, warranties or covenants not
contained in the Loan Documents and any such representations and warranties
contained in the Severed Loan Documents will be given by Borrower only as of the
Closing Date.
 
119

--------------------------------------------------------------------------------

(d)          Any amounts recovered from the Property or any other collateral for
the Loan after the occurrence of an Event of Default may be applied by Lender
toward the payment of any principal and/or interest of the Loan and/or any other
amounts due under the Loan Documents in such order, proportion and priority as
Lender in its sole and absolute discretion shall determine.
 
Section 10.3.        Right to Cure Defaults.
 
Lender may, but without any obligation to do so and without notice to or demand
on Borrower and without releasing Borrower from any obligation hereunder or
under the other Loan Documents or being deemed to have cured any Event of
Default, make, do or perform any obligation of Borrower hereunder or under the
other Loan Documents in such manner and to such extent as Lender may deem
necessary.  Lender is authorized to enter upon the Property for such purposes,
or appear in, defend, or bring any action or proceeding to protect its interest
in the Property for such purposes.  All costs and expenses incurred by Lender in
remedying or attempting to remedy such Event of Default or such other breach or
default by Borrower or in appearing in, defending, or bringing any action or
proceeding shall bear interest at the Default Rate from the date such costs and
expenses were incurred to the date reimbursement payment is received by Lender. 
All such costs and expenses incurred by Lender, together with interest thereon
calculated at the Default Rate, shall be deemed to constitute a portion of the
Obligations, shall be secured by the liens and security interests provided to
Lender under the Loan Documents and shall be immediately due and payable upon
demand by Lender therefore.
 
Section 10.4.        Remedies Cumulative.
 
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 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 singly, concurrently or otherwise, at such
time and in such order as Lender may determine in Lender’s sole and absolute
discretion.  No delay or omission to exercise any right, power or remedy
accruing upon an Event of Default shall impair any such right, power or remedy
or shall be construed as a waiver thereof, but any such right, power or remedy
may be exercised from time to time and as often as may be deemed expedient.  A
waiver of one Default or Event of Default shall not be construed to be a waiver
of any subsequent Default or Event of Default or to impair any right, power or
remedy consequent thereon.
 
120

--------------------------------------------------------------------------------

XI.          MISCELLANEOUS
 
Section 11.1.        Successors and Assigns.
 
This Agreement and all agreements, covenants, representations and warranties in
this Agreement, by or on behalf of Borrower, shall inure to the benefit of the
legal representatives, successors and assigns of Lender.
 
Section 11.2.        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.  Prior to a Securitization, whenever pursuant to
this Agreement the Rating Agencies are given any right to approve or disapprove,
or any arrangement or term is to be satisfactory to the Rating Agencies, the
decision of Lender to approve or disapprove or to decide whether arrangements or
terms are satisfactory or not satisfactory, based upon Lender’s determination of
Rating Agency criteria, shall be substituted therefore.
 
Section 11.3.        Governing Law.
 
(a)           THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK, THE LOAN
WAS MADE BY LENDER AND ACCEPTED BY BORROWER IN THE STATE OF NEW YORK, AND THE
PROCEEDS OF THE LOAN DELIVERED PURSUANT HERETO WERE DISBURSED FROM THE STATE OF
NEW YORK, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE
PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS,
INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT, THE NOTE AND THE OTHER
LOAN DOCUMENTS AND THE OBLIGATIONS ARISING HEREUNDER AND THEREUNDER SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE (WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS) AND ANY APPLICABLE LAW OF THE UNITED STATES OF
AMERICA, EXCEPT THAT AT ALL TIMES THE PROVISIONS FOR THE CREATION, PERFECTION,
AND ENFORCEMENT OF THE LIEN AND SECURITY INTEREST CREATED PURSUANT HERETO AND
PURSUANT TO THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED
ACCORDING TO THE LAW OF THE STATE IN WHICH THE PROPERTY IS LOCATED, IT BEING
UNDERSTOOD THAT, TO THE FULLEST EXTENT PERMITTED BY THE LAW OF SUCH STATE, THE
LAW OF THE STATE OF NEW YORK SHALL GOVERN THE CONSTRUCTION, VALIDITY AND
ENFORCEABILITY OF ALL LOAN DOCUMENTS AND ALL OF THE OBLIGATIONS ARISING
HEREUNDER OR THEREUNDER.  TO THE FULLEST EXTENT PERMITTED BY LAW, BORROWER
HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW
OF ANY OTHER JURISDICTION GOVERNS THIS AGREEMENT, THE NOTE AND THE OTHER LOAN
DOCUMENTS, AND THIS AGREEMENT, THE NOTE AND THE OTHER LOAN DOCUMENTS SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
 
121

--------------------------------------------------------------------------------

(b)          ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR BORROWER
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE NOTE OR THE OTHER LOAN
DOCUMENTS MAY AT LENDER’S OPTION BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN
THE CITY OF NEW YORK, COUNTY OF NEW YORK, PURSUANT TO SECTION 5-1402 OF THE NEW
YORK GENERAL OBLIGATIONS LAW AND BORROWER WAIVES ANY OBJECTIONS WHICH IT MAY NOW
OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT,
ACTION OR PROCEEDING, AND BORROWER HEREBY IRREVOCABLY SUBMITS TO THE
JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING.  BORROWER DOES
HEREBY DESIGNATE AND APPOINT:
 
CT Corporation System
111 Eighth Avenue, 13th Floor
New York, New York 10011
 
AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY
AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN
ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES THAT SERVICE OF
PROCESS UPON SAID AGENT AT SAID ADDRESS AND NOTICE OF SAID SERVICE MAILED OR
DELIVERED TO BORROWER IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY
RESPECT EFFECTIVE SERVICE OF PROCESS UPON BORROWER IN ANY SUCH SUIT, ACTION OR
PROCEEDING IN THE STATE OF NEW YORK.  BORROWER (I) SHALL GIVE PROMPT NOTICE TO
LENDER OF ANY CHANGED ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (II) MAY AT ANY
TIME AND FROM TIME TO TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN
OFFICE IN NEW YORK, NEW YORK (WHICH SUBSTITUTE AGENT AND OFFICE SHALL BE
DESIGNATED AS THE PERSON AND ADDRESS FOR SERVICE OF PROCESS), AND (III) SHALL
PROMPTLY DESIGNATE SUCH A SUBSTITUTE AGENT IF ITS AUTHORIZED AGENT CEASES TO
HAVE AN OFFICE IN NEW YORK, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A
SUCCESSOR.
 
122

--------------------------------------------------------------------------------

Section 11.4.        Modification, Waiver in Writing.
 
No modification, amendment, extension, discharge, termination or waiver of any
provision of this Agreement 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 11.5.        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 in, or exercising any
right, power, remedy or privilege under, this Agreement or any other Loan
Document 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 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 or the other Loan Documents, or to declare a default
for failure to effect prompt payment of any such other amount.  Lender shall
have the right to waive or reduce any time periods that Lender is entitled to
under the Loan Documents in its sole and absolute discretion.
 
Section 11.6.        Notices.
 
All notices, demands, requests, consents, approvals or other communications (any
of the foregoing, a “Notice”) required, permitted, or desired to be given
hereunder shall be in writing (a) sent by telefax (with answer back
acknowledged), (b) sent by registered or certified mail, postage prepaid, return
receipt requested, (c) delivered by hand or (d) delivered by reputable overnight
courier addressed to the party to be so notified at its address hereinafter set
forth, or to such other address as such party may hereafter specify in
accordance with the provisions of this Section 11.6.  Any Notice shall be deemed
to have been received:  (i) if sent by telefax, on the date of sending the
telefax if sent during business hours on a Business Day (otherwise on the next
Business Day), (ii) if sent by registered or certified mail, on the date of
delivery or the date of the first attempted delivery, in either case on a
Business Day (otherwise on the next Business Day), (iii) if delivered by hand,
on the date of delivery if delivered during business hours on a Business Day
(otherwise on the next Business Day), and (iv) if sent by an overnight
commercial courier, on the next Business Day, in each case addressed to the
parties as follows:
 
If to Lender:
 
UBS AG, by and through its branch office at
1285 Avenue of the Americas, New York, New York
1285 Avenue of the Americas
New York, New York 10019
Attention:  Transaction Management - Henry Chung
Facsimile No.:  (212) 821-2943
 
with a copy to:
 
123

--------------------------------------------------------------------------------

Alston & Bird LLP
90 Park Avenue
New York, New York 10016
Attention: Stephen J. Cerniglia, Esq.
Facsimile No.: (212) 210-9444
 
If to Borrower:

Ionis Gazelle, LLC
c/o Ionis Pharmaceuticals, Inc.
2855 Gazelle Court
Carlsbad, California 92010
Attention: CFO and General Counsel
Facsimile No.: (760) 918-3599

with a copy to:
 
Cooley LLP
4401 Eastgate Mall
San Diego, California  92121-1909
Attention:  Samantha M. LaPine, Esq.
Facsimile No.:  (858) 550-6420

Section 11.7.        Trial by Jury.
 
BORROWER 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 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 PARTY IS HEREBY AUTHORIZED TO FILE A COPY OF THIS
PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER.
 
Section 11.8.        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 11.9.        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.
 
124

--------------------------------------------------------------------------------

Section 11.10.      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.  To
the extent Borrower makes any payment 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 Person under any bankruptcy law, state or federal law, common law or
equitable cause, then, to the extent of such payment or proceeds received, the
Obligations or a portion 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.
 
Section 11.11.      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 the 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 11.12.      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 remedy 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 or its agent has acted
reasonably shall be determined by an action seeking declaratory judgment.
 
125

--------------------------------------------------------------------------------

Section 11.13.      Expenses; Indemnity.
 
(a)           Borrower shall pay or, if Borrower fails to pay, reimburse Lender
upon receipt of notice from Lender, for all reasonable costs and expenses
(including reasonable attorneys’ fees and expenses) incurred by Lender in
connection with (i) Borrower’s ongoing performance of and compliance with
Borrower’s 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; (ii) Lender’s ongoing performance of and compliance
with all 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;
(iii) 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
Borrower; (iv) 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 Liens in favor of Lender pursuant to this Agreement and the other Loan
Documents; (v) enforcing or preserving any rights in response to third party
claims or the prosecuting or defending of any action or proceeding or other
litigation or otherwise, in each case against, under or affecting Borrower, this
Agreement, any other Loan Document, the Property, or any other security given
for the Loan; (vi) enforcing any obligations of, or collecting any payments due
from, Borrower or Guarantor under this Agreement or 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; and (vii)
securing Borrower’s compliance with any requests made by Lender pursuant to the
provisions of this Agreement, including Section 9.1, Section 11.29 or Section
11.30 hereof; 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, its
employees, officers, agents, servicers and other representatives.  At Lender’s
discretion, any such costs and expenses due and payable to Lender may be paid to
Lender from any amounts in the Clearing Account or the Cash Management Account.
 
(b)           Borrower shall indemnify, defend and hold harmless Lender
Indemnitees from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, claims, costs, expenses and
disbursements of any kind or nature whatsoever (including, without limitation,
the reasonable fees and expenses of counsel for any Lender Indemnitee in
connection with any investigative, administrative or judicial proceeding
commenced or threatened, whether or not such Lender Indemnitee shall be
designated a party thereto), that may be imposed on, incurred by, or asserted
against any Lender Indemnitee in any manner relating to or arising out of (i)
any breach by Borrower of its obligations under, or any misrepresentation by
Borrower contained in, this Agreement or the other Loan Documents, (ii) any
misstatement or omission in any report, certificate, financial statement, other
agreement, instrument or document or other materials or information provided by
or on behalf of Borrower pursuant to this Agreement or any other Loan Document
or in connection with the Loan, or (iii) the use or intended use of the proceeds
of the Loan (collectively, the “Indemnified Liabilities”); provided, however,
that Borrower shall not have any obligation to the Lender Indemnitees hereunder
to the extent that such Indemnified Liabilities arise from the gross negligence,
illegal acts, fraud or willful misconduct of the Lender Indemnitees.  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 the Lender Indemnitees.
 
(c)           Borrower shall pay for or, if Borrower fails to pay, to reimburse
Lender for, any fees, costs and expenses of any Rating Agency in connection with
any consent, approval, waiver or confirmation obtained from such Rating Agency
pursuant to the terms and conditions of this Agreement or any other Loan
Document and Lender shall be entitled to require payment of such fees, costs and
expenses as a condition precedent to the obtaining of any such consent,
approval, waiver or confirmation.
 
126

--------------------------------------------------------------------------------

Section 11.14.      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 11.15.      Offsets, Counterclaims and Defenses.
 
Any assignee of Lender’s interest in and to this Agreement and the other Loan
Documents shall take the same free and clear of all offsets, counterclaims or
defenses which are unrelated to such documents which Borrower may otherwise have
against any assignor of such documents, and no such unrelated offset,
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 11.16.      No Joint Venture or Partnership.
 
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 or
to grant Lender any interest in the Property other than that of mortgagee,
beneficiary or lender.
 
Section 11.17.      Publicity.
 
All news releases, publicity or advertising by Borrower or its Affiliates
through any media which refers to the Loan, the Loan Documents or Lender or any
of its Affiliates shall be subject to the prior approval of Lender and
confidentiality requirements of Borrower.  In connection with Lender’s
promotional and/or marketing activities, Lender shall submit any press releases,
advertisements and other promotional materials for Borrower’s review and
approval (not to be unreasonably withheld, conditioned or delayed) prior to
issuance of any such materials, and such materials may describe the Loan in
general terms or in detail and Lender’s participation therein in the Loan (for
the avoidance of doubt, it is acknowledged and agreed that no Borrower’s review
and/or approval shall be required in connection with a Secondary Market
Transaction).
 
Section 11.18.       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, members 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.
 
127

--------------------------------------------------------------------------------

Section 11.19.      Waiver of Offsets/Defenses/Counterclaims.
 
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 or otherwise to offset any obligations to make the payments
required by the Loan Documents.  No failure by Lender to perform any of its
obligations hereunder shall be a valid defense to, or result in any offset
against, any payments which Borrower is obligated to make under any of the Loan
Documents.
 
Section 11.20.      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 and
agrees 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 legal, beneficial or economic 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 11.21.      Brokers and Financial Advisors.
 
Borrower hereby represents that, except for Jones Lang LaSalle (“Broker”), it
has dealt with no financial advisors, brokers, underwriters, placement agents,
agents or finders in connection with the transactions contemplated by this
Agreement.  Borrower will pay Broker a commission pursuant to a separate
agreement.  Borrower shall indemnify, defend and hold Lender harmless from and
against any and all liabilities, obligations, losses, damages, claims, costs and
expenses of any kind (including Lender’s attorneys’ fees and expenses) in any
way relating to or arising from a claim by any Person (including Broker) that
such Person acted on behalf of Borrower or Lender in connection with the
transactions contemplated herein.  The provisions of this Section 11.21 shall
survive the expiration and termination of this Agreement and the payment of the
Debt.
 
128

--------------------------------------------------------------------------------

Section 11.22.      Exculpation.
 
Subject to the qualifications below, Lender shall not enforce the liability and
obligation of Borrower to perform and observe the obligations contained in this
Agreement, the Note, the Security Instrument or the other Loan Documents by any
action or proceeding wherein a money judgment shall be sought against Borrower,
except that Lender may bring a foreclosure action, an action for specific
performance or any other appropriate action or proceeding to enable Lender to
enforce and realize upon its interest under this Agreement, the Note, the
Security Instrument and the other Loan Documents, or in the Property, the Rents,
or any other collateral given to Lender pursuant to the Loan Documents;
provided, however, that, except as specifically provided herein, any judgment in
any such action or proceeding shall be enforceable against Borrower only to the
extent of Borrower’s interest in the Property, in the Rents, and in any other
collateral given to Lender, and Lender, by accepting this Agreement, the Note,
the Security Instrument and the other Loan Documents, agrees that it shall not
sue for, seek or demand any deficiency judgment against Borrower in any such
action or proceeding under or by reason of or under or in connection with this
Agreement, the Note, the Security Instrument or the other Loan Documents.  The
provisions of this Section 11.22 shall not, however, (a) constitute a waiver,
release or impairment of any obligation evidenced or secured by any of the Loan
Documents; (b) impair the right of Lender to name Borrower as a party defendant
in any action or suit for foreclosure and sale under the Security Instrument;
(c) affect the validity or enforceability of any guaranty or indemnity made in
connection with the Loan or any of the rights and remedies of Lender thereunder;
(d) impair the right of Lender to obtain the appointment of a receiver; (e)
impair the enforcement of the Assignment of Leases; (f) constitute a prohibition
against Lender to seek a deficiency judgment against Borrower in order for
Lender to fully realize the security granted by the Security Instrument or to
commence any other appropriate action or proceeding in order for Lender to
exercise its rights and remedies against the Property, the Rents or any other
collateral given to Lender pursuant to the Loan Documents; or (g) constitute a
waiver of the right of Lender to enforce the liability and obligation of
Borrower, by money judgment or otherwise, to the extent of any loss, damage,
cost, expense, liability, claim or other obligation incurred by Lender
(including attorneys’ fees and costs reasonably incurred) arising out of or in
connection with, and Borrower shall be personally liable for, the following (all
such liability and obligation of Borrower for any or all of the following being
referred to herein as the “Borrower’s Recourse Liabilities”):
 
(i)            fraud or intentional or material misrepresentation by Borrower,
Guarantor, or any Borrower Related Party in connection with the Loan;
 
(ii)           the willful misconduct by or on behalf of Borrower, Guarantor, or
any Borrower Related Party in connection with the Loan;
 
(iii)          the breach of any representation, warranty, covenant or
indemnification provision in the Environmental Indemnity or in the Security
Instrument concerning Environmental Laws and Hazardous Substances;
 
(iv)         the removal or disposal of any portion of the Property during the
continuation of an Event of Default other than in the ordinary course of owning
and operating the Property with respect to the portion of the Property that is
either being replaced or that is no longer necessary in connection with the
operation of the Property; provided that such removal or disposal will not (A)
have a material adverse effect, (B) impair the utility or operation of the
Property in any material respect or (C) result in a reduction or abatement of,
or right of offset against, the rents under any Lease in respect of the
Property;
 
129

--------------------------------------------------------------------------------

(v)           (A) the misappropriation, misapplication or conversion by
Borrower, Guarantor or any Borrower Related Party of any Insurance Proceeds paid
by reason of any Casualty or any Awards or other amounts received in connection
with a Condemnation of all or a portion of the Property, (B) the
misappropriation or conversion by Borrower, Guarantor or any Borrower Related
Party of Rents or (C) the misapplication by Borrower, Guarantor or any Borrower
Related Party of any Rents during the continuation of an Event of Default;
 
(vi)          any security deposits, advance deposits or any other deposits
collected with respect to the Property which are not delivered to Lender upon a
foreclosure of the Property or action in lieu thereof, except, if applicable, to
the extent any such security deposits were applied in accordance with the terms
and conditions of the applicable Leases prior to the occurrence of the Event of
Default that gave rise to such foreclosure or action in lieu thereof;
 
(vii)         Borrower’s failure to pay any Taxes or assessments affecting the
Property, subject in all cases to Borrower's right to contest Taxes as set forth
in, and in accordance with, the terms and conditions of the Loan Documents;
provided that there shall be no liability hereunder if (A)(1) there are
sufficient funds on deposit in the Tax Account that are fully available to
Lender in accordance with the terms and conditions of the Loan Documents and (2)
Lender fails to apply the requisite portion of the Tax Funds, in accordance with
the terms and conditions of the Loan Documents, to the payment of such taxes or
assessments or (B) there is insufficient Gross Income from Operations from the
operation of the Property to pay such amounts;
 
(viii)        Borrower’s failure to obtain and maintain in full force and effect
fully paid for Policies as required by this Agreement; provided that there shall
be no liability hereunder if, to the extent such failure arises solely due to
non-payment of the applicable Insurance Premiums, (A)(1) there are sufficient
funds on deposit in the Insurance Account that are fully available to Lender in
accordance with the terms and conditions of the Loan Documents and (2) Lender
fails to apply the requisite portion of the Insurance Funds, in accordance with
the terms and conditions of the Loan Documents, to the payment of such Insurance
Premiums or (B) there is insufficient Gross Income from Operations to pay the
applicable Insurance Premiums;
 
(ix)          Borrower's failure to pay charges for labor or materials or other
charges that can create Liens on any portion of the Property, except, in the
case of any such charges incurred in accordance with the provisions of the Loan
Documents, (A) subject in all cases to Borrower's right to contest Liens as set
forth in, and in accordance with, the terms and conditions of the Loan Documents
and (B) except to the extent that (1) sums sufficient to pay such amounts have
been deposited in escrow accounts with Lender pursuant to the terms hereof which
accounts were established for the payment thereof, such escrowed sums are fully
available to Lender in accordance with the terms and conditions of the Loan
Documents, and Lender fails to apply the requisite portion thereof in accordance
with the terms and conditions of the Loan Documents to the payment of such
amounts or (2) there is insufficient Gross Income from Operations to pay such
amounts);
 
130

--------------------------------------------------------------------------------

(x)           Borrower’s indemnification of Lender set forth in Section 9.2
hereof and Sections 9.2 and 9.3 of the Security Instrument;
 
(xi)          any material physical waste at the Property caused by the
intentional or willful acts or omissions of Borrower, Guarantor or any Borrower
Related Party, except, with respect to any such waste arising solely from
omissions of Borrower, Guarantor or any Affiliate of Borrower or Guarantor
resulting from insufficient Gross Income from Operations to prevent such waste
at the Property;
 
(xii)         any matters relating to the completion of (1) the Existing Project
and/or (2) any other alterations, improvements, additions or changes to the
Property that have been commenced by Ionis, as tenant under the Ionis Lease;
 
(xiii)        the payment of fees or other amounts by Borrower to any of its
Affiliates in violation of the Loan Documents;
 
(xiv)        subject to clause (9) below under Springing Recourse Events, any
default occurs under the Ionis Lease beyond applicable notice and cure periods
expressly set forth in the Ionis Lease;
 
(xv)         commission of any criminal act by Borrower, Guarantor or any
Borrower Related Party which results in the forfeiture of the Property or any
portion thereof;
 
(xvi)        the breach of any representation, warranty or covenant set forth in
Section 3.1.8 or Section 4.2.10 hereof;
 
(xvii)       subject to clause (1) in the immediately following paragraph, if
Borrower fails to maintain its status as a single purpose entity as required by,
and in accordance with, the terms and provisions of this Agreement;
 
(xviii)      [reserved];
 
(xix)         Borrower fails to permit on-site inspections of the Property,
fails to provide financial information or fails to appoint a new property
manager upon the request of Lender, in each case as required by, and in
accordance with, the terms and provisions of, this Agreement and the other Loan
Documents; or
 
(xx)         Borrower, Guarantor or any Affiliate of Borrower or Guarantor
contests, impedes, delays or opposes the exercise by Lender of any enforcement
actions, remedies or other rights it has under or in connection with this
Agreement or the other Loan Documents or objects to any notice of strict
foreclosure or similar notice; provided that neither Borrower nor Guarantor
shall be liable to the extent of any applicable loss, damage, cost, expense,
liability, claim or other obligation arising solely from a defense of Borrower,
Guarantor or any Affiliate of Borrower or Guarantor raised in good faith.
 
131

--------------------------------------------------------------------------------

Notwithstanding anything to the contrary in this Agreement, the Note or any of
the other Loan Documents, (A) Lender shall not be deemed to have waived any
right which Lender may have under Section 506(a), 506(b) or 1111(b) or any other
provisions of the U.S. Bankruptcy Code or any other Bankruptcy Law to file a
claim for the full amount of the Debt or to require that all collateral shall
continue to secure all of the Obligations in accordance with the Loan Documents,
and (B) the Debt shall be fully recourse to Borrower in the event that any of
the following occurs (each, a “Springing Recourse Event”):  (1) Borrower fails
to maintain its status as a single purpose entity as required by, and in
accordance with the terms and provisions of, this Agreement and the other Loan
Documents (other than those single purpose entity covenants that relate to
solvency or adequacy of capital and excluding any breach to the extent arising
out of insufficient cash flow from the operation of the Property), which failure
is cited as a factor in a substantive consolidation of the assets and
liabilities of Borrower with any other Person in connection with a proceeding
under the Bankruptcy Law (other than a motion or pleading seeking a substantive
consolidation brought by Lender); (2) Borrower fails to obtain Lender’s prior
consent to any Indebtedness or any voluntary Lien encumbering the Property or
any portion thereof or interest therein except, in each case, to the extent
expressly permitted by this Agreement or the other Loan Documents; (3) Borrower
fails to obtain Lender’s prior consent to any Transfer except to the extent
expressly permitted by this Agreement and the other Loan Documents; (4) Borrower
files a voluntary petition under the Bankruptcy Law; (5) Guarantor or any
Borrower Related Party which controls, directly or indirectly, Borrower files,
or joins in the filing of, an involuntary petition against Borrower under the
Bankruptcy Law, or solicits or causes to be solicited petitioning creditors for
any involuntary petition against Borrower from any Person; (6) Borrower,
Guarantor or any Borrower Related Party which Controls, directly or indirectly,
Borrower files an answer consenting to or otherwise acquiescing in or joining in
any involuntary petition filed against such Person by any other Person under the
Bankruptcy Law, or solicits or causes to be solicited petitioning creditors for
any involuntary petition against Borrower from any Person; (7) Guarantor or any
Borrower Related Party which Controls, directly or indirectly, Borrower consents
to or acquiesces in or joins in an application for the appointment of a
custodian, receiver, trustee, or examiner for Borrower or all or any portion of
the Property; (8) Borrower makes an assignment for the benefit of creditors, or
admits, in writing or in any action or proceeding, its insolvency or inability
to pay its debts as they become due (unless failure to make such admission would
be a violation of applicable law); (9) the Ionis Lease is amended, modified or
terminated without Lender’s prior written consent; or (10) the first full
monthly payment of principal and interest under the Note is not paid when due.
 
In addition, notwithstanding anything contained in this Agreement or the other
Loan Documents, no direct or indirect partner, member, shareholder, principal,
officer, director, employee, agent, representative or affiliate of Borrower or
Guarantor (each a “Borrower Related Party”) (other than Borrower and Guarantor
pursuant to this Agreement, the Guaranty or the Environmental Indemnity) shall
have any personal liability for, nor be joined as a party to any action with
respect to (i) the payment of any sum of money which is or may be payable
hereunder or under any other Loan Document (including, but not limited to, the
repayment of the Debt) or (ii) the performance or discharge of any covenants,
obligations or undertakings of Borrower or Guarantor with respect thereto.
 
132

--------------------------------------------------------------------------------

Section 11.23.      Prior Agreements.
 
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, including, without limitation, the Term Sheet dated June 26,
2017 between Ionis Pharmaceuticals, Inc. and Lender, are superseded by the terms
of this Agreement and the other Loan Documents.
 
Section 11.24.      Servicer.
 
(a)          At the option of Lender, the Loan may be serviced by a master
servicer, primary servicer, special servicer and/or trustee (any such master
servicer, primary servicer, special servicer and trustee, together with its
agents, nominees or designees, are collectively referred to herein as
“Servicer”) selected by Lender and Lender may delegate all or any portion of its
responsibilities under this Agreement and the other Loan Documents to Servicer
pursuant to a pooling and servicing agreement, servicing agreement, special
servicing agreement and/or other agreement providing for the servicing of one
(1) or more mortgage loans (collectively, the “Servicing Agreement”) between
Lender and Servicer.  Borrower shall be responsible for (i) any reasonable
set-up fees not to exceed $1,000.00 or any other initial costs and expenses
relating to or arising under the Servicing Agreement and (ii) any fees and
expenses of Servicer (including, without limitation, attorneys’ fees and
disbursements) in connection with any release of the Property, any prepayment,
defeasance, assumption, amendment or modification of the Loan, any documents or
matters requested by Borrower, special servicing or work-out of the Loan or
enforcement of the Loan Documents.  Without limiting the generality of the
foregoing, Servicer shall be entitled to reimbursement of costs and expenses as
and to the same extent (but without duplication) as Lender is entitled thereto
under this Agreement and the other Loan Documents.
 
(b)          Upon notice thereof from Lender, Servicer shall have the right to
exercise all rights of Lender and enforce all obligations of Borrower and
Guarantor pursuant to the provisions of this Agreement and the other Loan
Documents.
 
(c)          Provided Borrower shall have been given notice of Servicer’s
address by Lender, Borrower shall deliver, or cause to be delivered, to Servicer
duplicate originals of all notices and other documents and instruments which
Borrower or Guarantor may or shall be required to deliver to Lender pursuant to
this Agreement and the other Loan Documents (and no delivery of such notices or
other documents and instruments by Borrower or Guarantor shall be of any force
or effect unless delivered to Lender and Servicer as provided above).
 
Section 11.25.      Joint and Several Liability.
 
If Borrower consists of more than one (1) Person, the representations,
warranties, covenants, obligations and liabilities of each Person shall be joint
and several.
 
Section 11.26.     Creation of Security Interest.
 
Notwithstanding any other provision set forth in this Agreement, the Note, the
Security Instrument or any of the other Loan Documents, Lender may at any time
grant a security interest in all or any portion of its rights under this
Agreement, the Note, the Security Instrument or any of the other Loan Documents
(including, without limitation, the payments owing to it) (a) to any Federal
Reserve Bank in accordance with Regulation A of the Board of Governors of the
Federal Reserve System or to the central reserve bank or similar authority of
any other country to secure any obligation of Lender or its Affiliates to such
bank or similar authority or (b) to secure any borrowing by Lender or its
Affiliates from any company that purchases or funds financial assets by issuing
commercial paper.
 
133

--------------------------------------------------------------------------------

Section 11.27.      Intentionally Omitted.
 
Section 11.28.      Set-Off.
 
In addition to any other rights and remedies of Lender provided by the Loan
Documents and by law, after the occurrence and during the continuance of an
Event of Default, Lender shall have the right, without prior notice to Borrower,
any such notice being expressly waived by Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by Borrower hereunder
or under the other Loan Documents (whether at the stated maturity, by
acceleration or otherwise) to set-off and appropriate and apply against such
amount any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by Lender or any Affiliate of
Lender to or for the credit or the account of Borrower.  Lender agrees to
promptly notify Borrower after any such set-off and application made by Lender;
provided that the failure to give such notice shall not affect the validity of
such set-off and application.
 
Section 11.29.      Component Notes.
 
Without in any way limiting Lender’s other rights under this Agreement or any
other Loan Document (including Lender’s rights under Section 9.1 and Section
11.30 hereof), Lender shall have the right, at any time and in its sole and
absolute discretion, to require Borrower to execute and deliver new component
notes (including senior and junior notes) to replace the original note or modify
the original note to reflect multiple components of the Loan, which notes may be
paid in such order of priority as may be designated by Lender, provided that (a)
the aggregate principal amount of such component notes shall, on the date
created, equal the Outstanding Principal Balance immediately prior to the
creation of such component notes, (b) the weighted average interest rate of all
such component notes shall, on the date created, equal the interest rate which
was applicable to the Loan immediately prior to the creation of such component
notes, and (c) the scheduled debt service payments on all such component notes
shall, on the date created, equal the scheduled debt service payments under the
Loan immediately prior to the creation of such component notes.  Borrower, at
its cost and expense, shall cooperate with all reasonable requests of Lender in
order to establish the component notes and shall execute and deliver, and cause
to be executed and delivered, such documents as shall reasonably be required by
Lender or any Rating Agency in connection therewith, all in form and substance
reasonably satisfactory to Lender and, if applicable, satisfactory to such
Rating Agency (including, without limitation, the severance of security
documents).  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 establish the component
notes as described in this Section 11.29, Borrower ratifying all that its said
attorney shall do by virtue thereof; provided, however, Lender shall not make or
execute any such documents under such power until three (3) days after notice
has been given to Borrower by Lender of Lender’s intent to exercise its rights
under such power.  All reasonable out-of-pocket third party costs and expenses
incurred by Borrower and Guarantor in connection with Borrower’s compliance with
Section 11.29 (including, without limitation, the fees and expenses of the
Rating Agencies but excluding Borrower and Guarantor’s own attorney’s fees)
shall be reimbursed by Lender.
 
134

--------------------------------------------------------------------------------

Section 11.30.      Mezzanine Loan.
 
Without in any way limiting Lender’s other rights under this Agreement or any
other Loan Document (including Lender’s rights under Section 9.1 and Section
11.29 hereof), Lender shall have the right (the “Mezzanine Option”) at any time,
in its sole and absolute discretion, to divide the Loan into two parts:  a
mortgage loan (the “Mortgage Loan”) and one or more mezzanine loans (each
individually, a “Mezzanine Loan”).  In effectuating the foregoing, Lender (in
its capacity as the lender under the Mezzanine Loans, “Mezzanine Lender”) will
make one or more mezzanine loans to single purpose, bankruptcy remote entities
that own, directly or indirectly, all of the legal, beneficial and economic
interests in Borrower (each individually, a “Mezzanine Borrower”) in the amount
of the related Mezzanine Loan; each Mezzanine Borrower will contribute the
amount of its Mezzanine Loan and the proceeds of any junior Mezzanine Loan
contributed to such Mezzanine Borrower by its immediately junior Mezzanine
Borrower to Borrower (Borrower, in its capacity as the borrower under the
Mortgage Loan, “Mortgage Borrower”) or to its immediately senior Mezzanine
Borrower, as applicable; and Mortgage Borrower will apply the contribution to
pay down the Loan to the amount of the Mortgage Loan.  In connection with the
Mezzanine Option:
 
(a)           Lender shall have the right to establish different interest rates
and debt service payments for the Mortgage Loan and the Mezzanine Loans and to
require the payment of the Mortgage Loan and the Mezzanine Loans in such order
of priority as may be designated by Lender; provided, that (i) the aggregate
principal amount of the Mortgage Loan and the Mezzanine Loans shall equal the
Outstanding Principal Balance immediately prior to the creation of the Mortgage
Loan and the Mezzanine Loans, (ii) the weighted average interest rate of the
Mortgage Loan and the Mezzanine Loans shall, on the date created, equal the
interest rate which was applicable to the Loan immediately prior to creation of
the Mortgage Loan and the Mezzanine Loans and (iii) the scheduled debt service
payments on the Mortgage Loan and the Mezzanine Loans shall, on the date
created, equal the scheduled debt service payments under the Loan immediately
prior to creation of the Mortgage Loan and the Mezzanine Loans.
 
(b)           Each Mezzanine Borrower shall be a single purpose, bankruptcy
remote entity under the criteria established by the Rating Agencies and shall
own directly one hundred percent (100%) of the legal, beneficial and economic
interests in Mortgage Borrower or its immediately senior Mezzanine Borrower, as
applicable.  The security for any Mezzanine Loan shall include a pledge by the
related Mezzanine Borrower of one hundred percent (100%) of the direct ownership
interests in Mortgage Borrower or its immediately senior Mezzanine Borrower, as
applicable.
 
135

--------------------------------------------------------------------------------

(c)           Borrower, Mortgage Borrower and Mezzanine Borrowers shall
cooperate with all reasonable requests of Lender in order to convert the Loan
into the Mortgage Loan and the Mezzanine Loans and shall execute and deliver,
and cause to be executed and delivered, such documents as shall reasonably be
required by Lender or any Rating Agency in connection therewith, all in form and
substance reasonably satisfactory to Lender and, if applicable, satisfactory to
such Rating Agency (including, without limitation, the delivery of bankruptcy
non-consolidation opinions and the modification of organizational documents and
loan documents).  Each of Borrower, Mortgage Borrower and Mezzanine Borrowers
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 convert the Loan as described in this
Section 11.30, each of Borrower, Mortgage Borrower and Mezzanine Borrowers
ratifying all that its said attorney shall do by virtue thereof; provided,
however, Lender shall not make or execute any such documents under such power
until three (3) days after notice has been given to Borrower by Lender of
Lender’s intent to exercise its rights under such power.  Borrower, Mortgage
Borrower and Mezzanine Borrowers shall pay all costs and expenses in connection
with the creation of the Mortgage Loan and the Mezzanine Loans and all
requirements relating thereto but, excluding Borrower and Guarantor’s own
attorney’s fees.
 
Section 11.31.     Approvals; Third Parties; Conditions.
 
(a)           All approval rights retained or exercised by Lender with respect
to any Leases, contracts, plans, studies and other matters are solely to
facilitate Lender’s credit underwriting, and shall not be deemed or construed as
a determination that Lender has passed on the adequacy thereof for any other
purpose and may not be relied upon by Borrower or any other Person.
 
(b)           This Agreement and the other Loan Documents are for the sole and
exclusive use of Borrower and Lender and may not be enforced, nor relied upon,
by any other Person.  Nothing contained in this Agreement or the other Loan
Documents shall be deemed to confer upon any Person other than Borrower and
Lender any right to insist upon or to enforce the performance or observance of
any of the terms, covenants and conditions contained herein or therein.  All
conditions to the obligations of Lender hereunder or under the other Loan
Documents are imposed solely and exclusively for the benefit of Lender and no
other Person shall have standing to require satisfaction of such conditions or
be entitled to assume that Lender will refuse to make the Loan (or, if
applicable, make any advances) or otherwise perform or satisfy such obligations
in the absence of strict compliance with any or all of such conditions 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 at any time in Lender’s sole and absolute discretion.
 
Section 11.32.      Limitation on Liability of Lender’s Officers, Employees,
etc. Any obligation or liability whatsoever of Lender which may arise at any
time under this Agreement or any other Loan Document shall be satisfied, if at
all, out of Lender’s interest in the Property only.  No such obligation or
liability shall be personally binding upon, nor shall resort for the enforcement
thereof be had to, any other asset or property of Lender or the asset or
property of any of Lender’s shareholders, directors, officers, employees or
agents, regardless of whether such obligation or liability is in the nature of
contract, tort or otherwise.
 
136

--------------------------------------------------------------------------------

Section 11.33.      Certain Additional Rights of Lender (VCOC).
 
Notwithstanding anything to the contrary contained in this Agreement, Lender
shall have:
 
(a)           the right to routinely consult with and advise Borrower’s
management regarding the significant business activities and business and
financial developments of Borrower; provided, however, that such consultations
shall not include discussions of environmental compliance programs or disposal
of Hazardous Substances.  Consultation meetings should occur on a regular basis
(no less frequently than quarterly) with Lender having the right to call special
meetings at any reasonable times upon reasonable notice;
 
(b)           the right, in accordance with the terms of this Agreement, to
examine the books and records of Borrower at any reasonable times upon
reasonable notice;
 
(c)           the right, in accordance with the terms of this Agreement,
including, without limitation, Section 4.1.6 hereof, to receive monthly,
quarterly and year end financial reports, including balance sheets, statements
of income, shareholder’s equity and cash flow, a management report and schedules
of outstanding indebtedness; and
 
(d)           the right, without restricting any other rights of Lender under
this Agreement (including any similar right), to approve any acquisition by
Borrower of any other significant property (other than personal property
required for the day to day operation of the Property).
 
The rights described above in this Section 11.33 may be exercised by any entity
which owns and Controls, directly or indirectly, substantially all of the
interests in Lender.
 
Section 11.34.     Acknowledgement and Consent to Bail-In of EEA Financial
Institutions. Notwithstanding anything to the contrary in any Loan Document or
in any other agreement, arrangement or understanding among any of the following
Persons, Borrower, each Borrower Related Party and Lender acknowledge that any
liability of any EEA Financial Institution arising under any Loan Document, to
the extent such liability is unsecured, may be subject to the Write-Down and
Conversion Powers of an EEA Resolution Authority and agrees and consents to, and
acknowledges and agrees to be bound by (i) the application of any Write-Down and
Conversion Powers by an EEA Resolution Authority to any such liabilities arising
hereunder which may be payable to it by any party hereto that is an EEA
Financial Institution; and (ii) the effects of any Bail-in Action on any such
liability, including, if applicable (A) a reduction in full or in part or
cancellation of any such liability; (B) a conversion of all, or a portion of,
such liability into shares or other instruments of ownership in such EEA
Financial Institution, its parent undertaking, or a bridge institution that may
be issued to it or otherwise conferred on it, and that such shares or other
instruments of ownership will be accepted by it in lieu of any rights with
respect to any such liability under this Agreement or any other Loan Document;
and/or (C) the variation of the terms of such liability in connection with the
exercise of the Write-Down and Conversion Powers of any EEA Resolution
Authority.
 
137

--------------------------------------------------------------------------------

Section 11.35.      Co-Lenders.
 
(a)           Borrower hereby acknowledges and agrees that the Loan may be held
by one or more Co-Lenders.  Borrower acknowledges that any such Co-Lenders may
be party to one or more co-lending agreements which may contain provisions
regarding the granting of consents and approval with respect to the Loan, and
that any such co-lending agreement is solely for the benefit of the Co-Lenders
and Borrower shall in no event be deemed a third-party beneficiary of any such
co-lending agreement.  Notwithstanding the foregoing, unless Lender has
appointed a Servicer in accordance with Section 11.24(a), all requests for
approval and consents hereunder and in every instance in which Lender’s consent
or approval is required, Borrower shall be required to obtain the consent and
approval of UBS AG and all copies of documents, reports, requests and other
delivery obligations of Borrower required hereunder shall be delivered by
Borrower to UBS AG.  Borrower shall be entitled to rely on the consent or
approval of UBS AG in all such instances.
 
(b)          The liabilities of Lender shall be several and not joint, (ii) no
Co-Lender shall be responsible for the obligations of any other Co-Lender, and
(iii) each Co-Lender shall be liable to Borrower only for its respective Ratable
Share of the Loan.  Notwithstanding anything to the contrary herein, all
indemnities by Borrower and obligations for costs, expenses, damages or advances
set forth herein shall run to and benefit each Co-Lender in accordance with its
Ratable Share.
 
(c)          Each Co-Lender agrees that it has, independently and without
reliance on any other Co-Lender, and based on such documents and information as
it has deemed appropriate, made its own credit analysis of Borrower and decision
to enter into this Agreement and that it will, independently and without
reliance upon any other Co-Lender, and based on such documents and information
as it shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under this Agreement or under any other
Loan Document.
 
[NO FURTHER TEXT ON THIS PAGE]
 
138

--------------------------------------------------------------------------------

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.
 

 
LENDER:
           
UBS AG
           
By:
       
Name:
     
Title:
           
By:
       
Name:
     
Title:
 

 
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK;
 SIGNATURE PAGE FOLLOWS]
 

--------------------------------------------------------------------------------

 
BORROWER:
         
 
Ionis Gazelle, LLC
         
By:
/s/ B. Lynne Parshall     Name: B. Lynne Parshall     Title: Chief Operating
Officer  

 

--------------------------------------------------------------------------------

SCHEDULE 1.1A
 
(DESCRIPTION OF REA)
 

●
That certain Declaration of Covenants, Conditions and Restrictions for Carlsbad
Oaks North Business Park by Techbilt Construction Corp, a California
corporation, dated January 10, 2007 and recorded as Document Number 2007-0081082
of the Official Records of San Diego County Recorder’s Office on February 5,
2007, as amended by that certain First Amendment to Declaration of Covenants,
Conditions and Restrictions for Carlsbad Oaks North Business Park, by and among
Techbilt Construction Corp, a California corporation, Carlsbad Oaks North
Ventures L.P., a California limited partnership, Kilroy Realty Finance
Partnership, L.P., a Delaware limited partnership, and BMR-Gazelle LP, a
Delaware limited partnership, dated August 1, 2012 and recorded as Document
Number 2003-0175873 of the Official Records of San Diego County Recorder’s
Office on March 20, 2013, as affected by that certain Declaration of Annexation
and Supplement to Declaration (Annexation: Phase 3 / Carlsbad Oaks North
Business Park) by Carlsbad Oaks North Partners, L.P., a California limited
partnership, dated October 24, 2016 and recorded as Document Number 2016-0576403
of the Official Records of San Diego County Recorder’s Office on October 25,
2016.

●
That certain Landscape Maintenance Agreement by and between BMR-Gazelle Court
LLC, a Delaware limited partnership, and Carlsbad Oaks North Business Park
Owners Association, a California nonprofit mutual benefit corporation, dated
March 21, 2011 and recorded as Document Number 2011-0245163 of the Official
Records of San Diego County Recorder’s Office on May 11, 2011.

●
That certain Permanent Stormwater Quality Best Management Practice Maintenance
Agreement, dated June 14, 2010, by and between BMR-Gazelle Court LLC and City of
Carlsbad, California, a municipal corporation, recorded as Document Number
2010-0371455 of the Official Records of San Diego County Recorder’s Office on
June 23, 2010

●
That certain Permanent Stormwater Quality Best Management Practice Maintenance
Agreement, dated March 23, 2017, by and between BMR-Gazelle LP and the City of
Carlsbad, California, a municipal corporation, recorded as Document Number
2017-0151310 of the Official Records of San Diego County Recorder’s Office on
April 4, 2017

 

--------------------------------------------------------------------------------

SCHEDULE 1.1B
 
(INVESTMENT POLICY GUIDELINES)
 

--------------------------------------------------------------------------------

SCHEDULE 3.1.22
 
(RENT ROLL)
 

--------------------------------------------------------------------------------

SCHEDULE 3.1.28
 
(ORGANIZATIONAL CHART)
 

--------------------------------------------------------------------------------

SCHEDULE 4.1.10
 
EXISTING PROJECT
 
Fitness Center: construction of a new stand-alone fitness center
 
Laboratory expansion from 2nd floor to 1st floor
 
Solar Power Panels: install solar panels on unimproved land (next to the new
fitness center)
 
Office Space Build- out: convert former fitness center to office space
 

--------------------------------------------------------------------------------

SCHEDULE 9.1(b)
 
(UPDATED INFORMATION)
 

1.
Any proposed program for the renovation, improvement or development of the
Property, or any part thereof, including the estimated cost thereof and the
method of financing to be used.

 

2.
The general competitive conditions to which the Property is or may be subject.

 

3.
Management of the Property.

 

4.
Occupancy rate expressed as a percentage for each of the last five (5) years.

 

5.
Principal businesses, occupations and professions carried on, in or from the
Property.

 

6.
Number of tenants occupying 10% or more of the total rentable square footage of
the Property, the principal business of each such tenant, and the principal
provisions of the Leases with such tenants (including, but not limited to: rent
per annum, expiration date, and renewal options).

 

7.
The average effective annual rent per square foot or unit for each of the last
three (3) years.

 

8.
Schedule of the lease expirations for each of the following ten (10) years
stating:

 
(a)           The number of tenants whose leases will expire.
 
(b)           The total area in square feet covered by such Leases.
 
(c)           The annual rent represented by such Leases.
 
(d)           The percentage of gross annual rent represented by such Leases.
 
 

--------------------------------------------------------------------------------