Exhibit 10.1
EXECUTION COPY
SECOND AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF
NET LEASE STRATEGIC ASSETS FUND L.P.
Dated as of February 20, 2008

 

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TABLE OF CONTENTS

              Page  
ARTICLE I DEFINITIONS
    1  
Section 1.1 Definitions
    1  
ARTICLE II FORMATION, DURATION AND PURPOSES; PURCHASE OF INITIAL PROPERTIES
    18  
Section 2.1 Formation
    18  
Section 2.2 Name; Registered Agent and Registered Office
    18  
Section 2.3 Principal Office
    18  
Section 2.4 Purposes and Business
    18  
Section 2.5 Term
    18  
Section 2.6 Other Qualifications
    19  
Section 2.7 Limitation on the Rights of Partners
    19  
Section 2.8 Purchase of Qualified Sale Assets
    19  
Section 2.9 Remuneration To Partners
    19  
ARTICLE III MANAGEMENT RIGHTS, DUTIES, AND POWERS OF THE GENERAL PARTNER;
TRANSACTIONS INVOLVING PARTNERS
    19  
Section 3.1 Management
    19  
Section 3.2 Actions of the General Partner
    21  
Section 3.3 Authority of the General Partner
    21  
Section 3.4 Major Decisions
    23  
Section 3.5 Preliminary and Annual Plans
    26  
Section 3.6 Qualified Asset Acquisitions
    27  
Section 3.7 Sale of Qualified Assets
    30  
Section 3.8 Partnership Indebtedness
    31  
Section 3.9 Business Opportunity
    32  
Section 3.10 Payments to the Asset Manager of the General Partner
    34  
Section 3.11 Exculpation
    35  
Section 3.12 Indemnification
    36  
ARTICLE IV BOOKS AND RECORDS; REPORTS TO PARTNERS
    37  
Section 4.1 Books
    37  
Section 4.2 Monthly and Quarterly Reports
    37  

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TABLE OF CONTENTS
(continued)

              Page  
Section 4.3 Annual Reports
    38  
Section 4.4 Accountants; Tax Returns
    38  
Section 4.5 Accounting and Fiscal Year
    38  
Section 4.6 Partnership Funds
    38  
Section 4.7 Insurance
    39  
ARTICLE V CONTRIBUTIONS
    39  
Section 5.1 Capital Contributions
    39  
Section 5.2 Preferred Equity Capital Contribution
    42  
Section 5.3 Return of Capital Contribution
    42  
Section 5.4 Liability of the Limited Partners
    42  
Section 5.5 No Third Party Beneficiaries
    42  
ARTICLE VI MAINTENANCE OF CAPITAL ACCOUNTS; ALLOCATION OF PROFITS AND LOSSES FOR
BOOK AND TAX PURPOSES
    42  
Section 6.1 Capital Accounts
    42  
Section 6.2 Profits and Losses
    43  
Section 6.3 Regulatory Allocations
    44  
Section 6.4 Allocation of Tax Items for Tax Purposes
    46  
Section 6.5 Tax Matters Partner
    47  
Section 6.6 Adjustments
    47  
ARTICLE VII DISTRIBUTIONS
    47  
Section 7.1 Cash Available for Distributions
    47  
ARTICLE VIII TRANSFER; REMOVAL OF GENERAL PARTNER
    51  
Section 8.1 Prohibition on Transfers and Withdrawals by Partners
    51  
Section 8.2 Removal of LMLP GP as General Partner
    52  
ARTICLE IX TERMINATION
    52  
Section 9.1 Dissolution
    52  
Section 9.2 Termination
    53  
Section 9.3 Certificate of Cancellation
    54  
Section 9.4 Acts in Furtherance of Liquidation
    54  
ARTICLE X REPRESENTATIONS OF THE PARTNERS
    54  

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TABLE OF CONTENTS
(continued)

              Page  
Section 10.1 Representations of Inland
    54  
Section 10.2 Representations of the LMLP Partners
    56  
ARTICLE XI SPECIAL PARTNER RIGHTS AND OBLIGATIONS
    57  
Section 11.1 Right of First Offer
    57  
Section 11.2 Buy/Sell
    58  
Section 11.3 Provisions Applicable to Right of First Offer and Buy/Sell
    60  
ARTICLE XII GENERAL PROVISIONS
    61  
Section 12.1 Notices
    61  
Section 12.2 Governing Laws
    62  
Section 12.3 Entire Agreement
    63  
Section 12.4 Waiver
    63  
Section 12.5 Validity
    63  
Section 12.6 Terminology; Captions
    63  
Section 12.7 Remedies Not Exclusive
    63  
Section 12.8 Action by the Partners
    64  
Section 12.9 Further Assurances
    64  
Section 12.10 Liability of the Limited Partners
    64  
Section 12.11 Binding Effect
    64  
Section 12.12 Amendments
    64  
Section 12.13 Counterparts
    64  
Section 12.14 Waiver of Partition
    64  
Section 12.15 No Third Party Beneficiaries
    64  
Section 12.16 Expenses
    64  
Section 12.17 Jurisdiction; Venue
    65  
Section 12.18 Jury Waiver
    65  
Section 12.19 REIT Provisions.
    65  

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TABLE OF CONTENTS
(continued)

                  Page
SCHEDULE 1
  CAPITAL COMMITMENT OF PARTNERS/INITIAL CAPITAL CONTRIBUTIONS/PERCENTAGE
INTERESTS/PREFERRED EQUITY CAPITAL CONTRIBUTION/QUALIFIED CONTRIBUTED ASSETS    
SCHEDULE 2
  ACQUISITION PARAMETERS    
SCHEDULE 2.8
  QUALIFIED SALE ASSETS    
SCHEDULE 3.5
  FORM OF ANNUAL PLAN    
SCHEDULE 3.9
  LMLP EXISTING JOINT VENTURE EXCLUSIVITY TERMS    
SCHEDULE 4.7
  INSURANCE REQUIREMENTS    
 
       
EXHIBIT A
EXHIBIT B
EXHIBIT C
EXHIBIT D
EXHIBIT E
  FORM OF ANNUAL BUDGET
FORM OF CONTRIBUTION AGREEMENT
FORM OF MANAGEMENT AGREEMENT
FORM OF PURCHASE AGREEMENT
FORM OF SP SUBSIDIARY PARTNERSHIP AGREEMENT    
EXHIBIT F
  FORM OF SP SUBSIDIARY LIMITED LIABILITY COMPANY AGREEMENT    

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SECOND AMENDED AND RESTATED
LIMITED PARTNERSHIP AGREEMENT
OF
NET LEASE STRATEGIC ASSETS FUND L.P.
     THIS SECOND AMENDED AND RESTATED LIMITED PARTNERSHIP AGREEMENT (as it may
be amended, modified, supplemented or restated from time to time, this
“Agreement”) of NET LEASE STRATEGIC ASSETS FUND L.P. (the “Partnership”), made
and entered into as of February 20, 2008 by and among The Lexington Master
Limited Partnership, a Delaware limited partnership (“LMLP”), as a limited
partner of the Partnership, LMLP GP LLC, a Delaware limited liability company
(“LMLP GP”), as a general partner of the Partnership, and Inland American (Net
Lease) Sub, LLC, a Delaware limited liability company (“Inland”), as a limited
partner of the Partnership, amends and restates in its entirety the Amended and
Restated Limited Partnership Agreement, made and entered into as of November 5,
2007 (the “Prior Agreement”), by and among LMLP, LMLP GP and Inland, as amended
by that certain First Amendment to the Limited Partnership Agreement of the
Partnership, dated December 20, 2007.
     LMLP and Inland are sometimes individually referred to herein as a “Limited
Partner” and collectively referred to herein as the “Limited Partners”. The
Limited Partners and the General Partner are sometimes individually referred to
herein as a “Partner” and collectively referred to herein as the “Partners”.
LMLP and LMLP GP are sometimes individually referred to herein as a “LMLP
Partner” and collectively referred to herein as the “LMLP Partners”.
     In consideration of the covenants and agreements set forth herein, the
Partners hereby amend and restate the Prior Agreement in its entirety and agree
as follows:
ARTICLE I
DEFINITIONS
          Section 1.1 Definitions. For the purposes of this Agreement, initially
capitalized terms used herein shall have the following meanings:
     “Acquisition Activities” is defined in Section 3.6(f) hereof.
     “Acquisition Costs” is defined in Section 3.6(f) hereof.
     “Acquisition Fee” is defined in Section 3.6(g) hereof.
     “Acquisition Memorandum” shall mean a memorandum with respect to any
Proposed Qualified Asset as provided in Section 3.6(b) hereof.
     “Acquisition Parameters” shall mean the guidelines and requirements for any
Proposed Qualified Asset that are set forth on Schedule 2 hereto.

 

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     “Acquisition Period” shall mean the period commencing on August 10, 2007
and ending the earliest of (a) the second anniversary of August 10, 2007 and
(b) a Removal Event; provided that, if the Acquisition Period has not ended
because of a Removal Event, the Acquisition Period may, pursuant to Section 3.4
hereof, be extended for a period of six months.
     “Act” is defined in Section 2.1 hereof.
     “Additional Capital Contribution” is defined in Section 5.1(b) hereof.
     “Adjusted Capital Account Deficit” shall mean the deficit balance, if any,
in a Partner’s Capital Account at the end of any fiscal year, with the following
adjustments: (a) credit to such Capital Account any amount that such Partner is
obligated or deemed obligated to restore under Regulations
Section 1.704-1(b)(2)(ii)(c), as well as any additions thereto pursuant to the
next to last sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5),
after taking into account thereunder any changes during such year in Partnership
Minimum Gain and in the minimum gain attributable to any Partner Nonrecourse
Debt; and (b) debit to such Capital Account the items described in Regulations
Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6). The foregoing definition of
Adjusted Capital Account Deficit is intended to comply with the provisions of
Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted in a manner
consistent with such intent.
     “Affiliate” when used with respect to any particular Person, shall mean
(a) any Person or group of Persons acting in concert that directly or indirectly
through one or more intermediaries controls or is controlled by or is under
common control with such particular Person, (b) any Person that is an officer,
partner, manager, member or trustee of, or serves in a similar capacity with
respect to, such particular Person or of which such particular Person is an
officer, partner, manager, member or trustee or with respect to which such
particular Person serves in a similar capacity, (c) any Person that, directly or
indirectly, is the beneficial owner of 10% or more of any class of voting
securities of, or otherwise has an equivalent beneficial interest in, such
particular Person or of which such particular Person is directly or indirectly
the owner of 10% or more of any class of voting securities or in which such
particular Person has an equivalent beneficial interest or (d) any relative or
spouse of such particular Person. Notwithstanding the foregoing, (a) neither
LMLP nor LMLP GP shall be deemed to be an Affiliate of Inland and (b) Inland
shall not be deemed to be an Affiliate of the LMLP Partners. The definition of
“Affiliate” as used in this Agreement shall not be affected by the Regulations
under Code Section 752 describing certain “related” parties.
     “Agreement” is defined in the Preamble hereto. This Agreement shall be the
“partnership agreement” for the Partnership within the meaning of
Section 17-101(12) of the Act.
     “Annual Budget” shall mean the annual budget for the Partnership and each
Qualified Asset for any fiscal year, including without limitation a reasonable
description of the amount, source and character of each item of gross income,
expense and services to be rendered in the form attached hereto as Exhibit A,
approved by the Executive Committee as provided in Section 3.5 hereof.

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     “Annual Plan” is defined in Section 3.5(a) hereof.
     “Approved Qualified Asset” is defined in Section 3.6(d) hereof.
     “Asset Manager” shall mean (i) so long as LMLP GP is the General Partner,
Lexington Realty Advisors, Inc. or another Affiliate of LMLP, or (ii) so long as
LMLP GP is no longer the General Partner, such other entity, including an
Affiliate of Inland, that may be appointed by the Executive Committee, in each
case to provide asset management services to the Partnership on market terms if
a third party manager is hired or pursuant to the terms of the Management
Agreement if an Inland Affiliate.
     “Bankruptcy” of the Partnership or a Partner shall be deemed to have
occurred upon the happening of any of the following: (a) the filing of an
application by the Partnership or such Partner for, or a consent to, the
appointment of a trustee, receiver or liquidator of its assets; (b) the filing
by the Partnership or such Partner of a voluntary petition or answer in
bankruptcy or the filing of a pleading in any court of record admitting in
writing its inability to pay its debts as such debts come due or seeking
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any statute, law or regulation; (c) the making by the
Partnership or such Partner of a general assignment for the benefit of
creditors; (d) the filing by the Partnership or such Partner of an answer
admitting the material allegations of, or its consenting to or defaulting in
answering, a bankruptcy or insolvency petition filed against it in any
bankruptcy or similar proceeding; (e) the entry by any court of competent
jurisdiction of an order for relief in any bankruptcy or insolvency proceeding
involving the Partnership or such Partner or of an order, judgment or decree
adjudicating the Partnership or such Partner a bankrupt or insolvent or
appointing a trustee, receiver or liquidator of its assets; or (f) the filing by
a third party against the Partnership of such Partner of an involuntary petition
under any bankruptcy or insolvency law, which petition is not dismissed within
sixty (60) days from the date of such filing.
     “Book Basis” shall mean, with respect to any asset of the Partnership, the
adjusted basis of such asset for federal income tax purposes; provided, however,
that (a) if any asset is contributed to the Partnership, the initial Book Basis
of such asset shall equal its fair market value on the date of contribution (as
agreed to by the Partners), and (b) if the Capital Accounts of the Partners are
adjusted pursuant to Treasury Regulations Section 1.704-1(b) to reflect the fair
market value of any asset of the Partnership, the Book Basis of such asset shall
be adjusted to equal its respective fair market value as of the time of such
adjustment (as agreed to by the Partners), in accordance with such Treasury
Regulations. The Book Basis of all assets of the Partnership shall be adjusted
thereafter by depreciation or amortization as provided in Treasury Regulations
Section 1.704-1(b)(2)(iv)(g) and any other adjustment to the basis of such
assets other than depreciation or amortization.
     “Book Depreciation” shall mean all deductions attributable to the
depreciation, amortization or other cost recovery, including additions, of any
Qualified Asset or other asset (whether tangible or intangible) acquired by the
Partnership that has a useful life in excess of one year, as such deductions are
computed for federal income tax purposes; provided, that with respect to any
Partnership asset the tax basis of which differs from the Book Value of such
asset, Book Depreciation for any period shall equal (a) the sum total of all
deductions taken during

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such period attributable to depreciation, amortization or other cost recovery
deduction for federal income tax purposes with respect to such asset, multiplied
by (b) the Book Value of such asset divided by the tax basis thereof; provided
further, that if the depreciation, amortization or other cost recovery deduction
for federal income tax purposes with respect to any Partnership asset for any
period is zero ($0.00), Book Depreciation shall be determined by the Tax Matters
Partner using any reasonable method selected by the Tax Matters Partner that is
based on the Book Value of such asset.
     “Book Value” shall mean, with respect to any Partnership asset at any time,
the adjusted basis of such asset for federal income tax purposes, except that
(a) the initial Book Value of any asset contributed by a Partner to the
Partnership shall be the Fair Market Value of such asset, and (b) the Book Value
of all Partnership assets shall be adjusted to equal their Fair Market Values,
as determined in good faith by the General Partner, upon the occurrence of
certain events as described below. In either case, the Book Value of Partnership
assets shall thereafter be adjusted for Book Depreciation taken into account
with respect to such asset. Provided the Tax Matters Partner makes an election
to do so as provided under Section 1.704-1(b)(2)(iv)(f) of the Regulations, the
Book Value of Partnership assets shall be adjusted to equal their Fair Market
Value, as determined in good faith by the General Partner, as of the following
times to which the election relates: (a) the admission of a new Partner to the
Partnership or acquisition by an existing Partner of an additional interest in
the Partnership, provided that the consideration contributed to the Partnership
upon such admission or acquisition is more than a de minimis amount of money or
assets; (b) the distribution by the Partnership to a Partner of more than a de
minimis amount of money or other assets; and (c) the termination of the
Partnership for federal income tax purposes pursuant to Code
Section 708(b)(1)(B).
     The Book Value of all Partnership assets shall also be increased (or
decreased) to the extent that adjustments to the adjusted basis of such assets
pursuant to Code Section 734(b) or Code Section 743(b) have been taken into
account for purposes of determining Capital Accounts in accordance with
Regulation Section 1.704-1(b)(2)(iv)(m), unless such adjustments have already
been accounted for pursuant to the preceding paragraph. If the Book Value of an
asset has been determined or adjusted pursuant hereto, such value shall
thereafter be the basis for, and be adjusted by, the depreciation taken into
account with respect to, such asset for purposes of computing Profits and
Losses. Moreover, notwithstanding the foregoing, the Book Value of any
Partnership asset distributed to any Partner shall be the gross Fair Market
Value of such asset on the date of distribution.
     “Business Day” shall mean any day other than a Saturday, Sunday or any day
on which national banks in New York, New York are not open for business.
     “Buy/Sell Asset” is defined in Section 11.2(a) hereof.
     “Buy/Sell Notice” is defined in Section 11.2(a) hereof.
     “Buy/Sell Offer Price” is defined in Section 11.2(a) hereof.
     “Buy/Sell Offering Partner” is defined in Section 11.2(a) hereof.

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     “Buy/Sell Responding Interest Price” is defined in Section 11.2(c) hereof.
     “Buy/Sell Responding Partner” is defined in Section 11.2(a) hereof.
     “Buy/Sell Response Notice” is defined in Section 11.2(a) hereof.
     “Cap Ex/Lease Assumed Asset” shall mean the following Qualified Assumed
Assets: (i) the property located at 940 Industrial Road, Marshall, Michigan;
(ii) the property located at 10419 North 30th Street, Tampa, Florida; and
(iii) the property located at 601 & 701 Experian Parkway, Allen, Texas.
     “Cap Ex/Lease Assumed Asset Amount” is defined in Section 5.1(a) hereof.
     “Capital Account” shall mean, with respect to any Partner, the separate
“book” account which the Partnership shall establish and maintain for such
Partner as provided in Section 6.1 hereof and in accordance with Section 704(b)
of the Code and Regulations Section 1.704-1(b)(2)(iv) and such other provisions
of Section 1.704-1(b) of the Regulations as must be complied with in order for
the Capital Accounts to be determined in accordance with the provisions of said
Regulations. In furtherance of the foregoing, the Capital Accounts shall be
maintained in compliance with Section 1.704-1(b)(2)(iv) of the Regulations, and
the provisions hereof shall be interpreted and applied in a manner consistent
therewith.
     “Capital Call” is defined in Section 5.1(b) hereof.
     “Capital Commitment” shall mean, with respect to each Partner, the amount
set forth opposite its name on Schedule 1 hereto, as such Schedule may be
amended or modified from time to time upon the Partners’ unanimous consent.  Any
payment of the Acquisition Fees by Inland shall decrease Inland’s Capital
Commitment, and, in such event, LMLP’s Capital Commitment shall be decreased by
17.65% of the amount Inland’s Capital Commitment is decreased. 
     “Capital Contribution” shall mean, (a) the Initial Capital Contributions
set forth on Schedule 1 hereto, (b) the Remaining Qualified Assumed Assets
Capital Contribution, which when made shall be added to Schedule 1 hereto, and
(c) at any particular time thereafter and with respect to any Partner, an amount
equal to the sum of (a) the total amount of cash and (b) the Fair Market Value
of any asset (determined as of the date such asset is contributed by such
Partner and net of any liabilities secured by such asset that the Partnership is
considered to assume or take subject to under Section 752 of the Code) that has
in each case been contributed to the Partnership by such Partner pursuant to
Section 5.1 hereof.
     “Change of Control” shall be deemed to occur upon (a) any Person (and its
Affiliates) becoming the beneficial owner, directly or indirectly, of more than
fifty percent (50%) of the outstanding partnership interests in LMLP (other than
an LMLP Affiliated Party) and (b) the resignation or removal (including death or
permanent disability) of at least two of the following individuals from the
management of LMLP: Michael L. Ashner, E. Robert Roskind and T. Wilson Eglin.
     “Closing” is defined in Section 11.3(c) hereof.
     “Closing Date” is defined in Section 11.3(c) hereof.

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     “Code” shall mean the Internal Revenue Code of 1986, as amended, or
corresponding provisions of future laws.
     “Contributed Asset” is defined in the Contribution Agreement.
     “Contribution Agreement” shall mean the Contribution Agreement, dated as of
August 10, 2007, pursuant to which LMLP contributes the Qualified Contribution
Assets to the Partnership pursuant to Section 5.1 hereof and a copy of which is
attached as Exhibit B to this Agreement.
     “CPI” shall mean the Revised Consumer Price Index for All Urban Consumers
published by the Bureau of Labor Statistics of the United States Department of
Labor, U.S. City Average, All Items, based on 2002 as 100. If the CPI hereafter
ceases to use the 2002 Base as 100, then the CPI with the new base shall be
used. If the Bureau of Labor Statistics ceases to publish the CPI, then the
successor or most nearly comparable index shall be used. In the event that the
U.S. Department of Labor, Bureau of Labor Statistics, changes the publication
frequency of the CPI so that it is not available when required under the
Agreement, then the CPI for the closest preceding month for which a CPI is
available shall be used in place of the CPI no longer available.
     “Default Sale Period” is defined in Section 11.3(d) hereof.
     “Defaulting Partner” is defined in Section 11.3(b) hereof.
     “Delayed Qualified Assumed Assets” shall mean the following Qualified
Assumed Assets: (i) the property located at 9110 Grogans Mill Road, Houston,
Texas; and (ii) the property located at 1200 Jupiter Road, Garland, Texas.
     “Deposit” is defined in Section 5.1(d) hereof.
     “Distributable Cash” shall mean the amounts distributed pursuant to
Sections 7.1(b) and (c) hereof.
     “Distribution Date” is defined in Section 7.1(b)(i) hereof.
     “Economic Interest” shall mean, with respect to any Percentage Interest,
(a) all income, profits, cash flow, proceeds of sales and/or refinancing of the
Qualified Assets, fees or payments of whatever nature and all distributions to
which any Partner would be entitled, now or at any time hereafter, of whatsoever
description or character; (b) all of any Partner’s present and future rights to
and in its Capital Account, whether by way of liquidating distributions or
otherwise, and all of such Partner’s right to receive or share in any surplus of
the Partnership in the event of the dissolution of the Partnership; and (c) all
damages, awards, money and considerations of any kind or character to which any
Partner would be entitled, now or at any time hereafter, arising out of or
derived from any proceeding by or against such Partner in any federal or state
court, under any bankruptcy or insolvency law or under any law relating to
assignments for the benefit of creditors, compositions, extensions or
adjustments of indebtedness, or to any other relief of debtors, or otherwise in
connection with its interest in the Partnership.

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     “Economic Risk of Loss” shall have the meaning specified in Regulations
Section 1.752-2.
     “Environmental Assessment” shall mean with respect to any Proposed
Qualified Asset, a phase one environmental site assessment performed by a
qualified environmental consultant selected by the General Partner in accordance
with the then current ASTM Standard Practice for Environmental Site Assessments,
E1527 and, if required by the General Partner, any additional Phase II sampling,
investigation, monitoring or other activities performed by a qualified
environmental consultant.
     “Environmental Law” shall mean every federal, state, county or other
governmental law, statute, ordinance, rule, regulation, requirement, order
(including any consent order), or other binding obligation, injunction, writ or
decision relating to or addressing the environment or hazardous materials,
including, but not limited to, those federal statutes commonly referred to as
the Clean Air Act, Clean Water Act, Resource Conservation Recovery Act, Toxic
Substances Control Act, Comprehensive Environmental Response, Compensation and
Liability Act and the Endangered Species Act as well as all regulations
promulgated thereunder and all state laws and regulations equivalent thereto, as
each such statute, regulation or state law or regulation equivalent may be
amended from time to time.
     “Equity Capital” shall mean the book equity of the Partnership, computed in
accordance with GAAP and based on the monthly average over the fiscal year,
adjusted to exclude the effect of any depreciation, unrealized gains, unrealized
losses and other non-cash items. For realized gains or losses, the amount of
gain or loss shall be based on unadjusted book value.
     “Event of Default” shall mean with respect to or by any Partner (a) the
declaration of Bankruptcy, (b) a failure to timely perform its obligations under
this Agreement (or with respect to the LMLP Partners, the failure by an LMLP
Affiliated Party to timely perform its obligations under the Contribution
Agreement, the Purchase Agreement or the Management Agreement), including the
failure of the General Partner to timely enforce any material term of the
Management Agreement, or other material breach of this Agreement (or with
respect to the LMLP Partners, any other material breach by an LMLP Affiliated
Party of a material provision of the Contribution Agreement, the Purchase
Agreement or the Management Agreement) and the continuation of such failure or
other material breach beyond the applicable grace, notice or cure periods, if
any, including, without limitation, the obligation to make any Additional
Capital Contributions, (c) any attempted assignment, mortgage, pledge, transfer
or other disposition, whether voluntary or involuntary, of its Percentage
Interests (in whole or in part) not expressly permitted in this Agreement,
(d) the dissolution, withdrawal or incapacity of such Partner, which prohibits
such Partner’s ability to continue as a Partner of the Partnership, (e) the
intentional misrepresentation by such Partner or any of its Affiliates of a
material fact involving the Partnership to another Partner or an Affiliate
thereof or to the Partnership, (f) the entry of a final judgment or decree of a
court or governmental agency having proper jurisdiction, declaring such Partner
guilty of a felony involving moral turpitude, fraud or wrongdoing in connection
with any business activity, (g) the misapplication by such Partner or any of its
Affiliates of any assets of the Partnership, or (h) fraud or material and
willful misconduct by such Partner or any of its Affiliates involving the
Partnership or in the performance of its obligations under this Agreement

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or the Management Agreement, Contribution Agreement or Purchase Agreement. The
matters set forth in clauses (b), (c), (e), (f), (g) and (h) above shall not
constitute an Event of Default if such matter does not pertain to wrongdoing
involving a criminal conviction and such matter is cured (including the payment
of any damages) within thirty (30) days following receipt of notice of such
failure from any other Partner, unless such matter by its very nature is
incapable of being cured within such thirty (30) day period and the defaulting
Partner has commenced and is diligently pursuing a cure, in which event such
defaulting Partner shall have a commercially reasonable period not to exceed
ninety (90) days to effect such cure; provided that in the case of matters set
forth in (f), (g) and (h), the cure shall include the removal of the employees
or agents involved in such event from the active management of the Partnership.
So long as LMLP GP is the General Partner, a breach of Section 3.8(a) or
Section 12.19 shall be considered an Event of Default by LMLP, unless such
breach (i) has been cured within ninety (90) days of such breach and a similar
breach of Section 3.8(a) has not occurred in the previous twelve (12) months in
the case of Section 3.8(a), (ii) was directly and proximately caused by an
action approved by a Supermajority Vote of the Executive Committee or consented
to by Inland and Inland had knowledge of the possibility of such breach.
     “Executive Committee” shall mean a committee of five (5) members,
consisting of three (3) members appointed by LMLP and two (2) members appointed
by Inland. The initial members of the Executive Committee appointed by the LMLP
Partners shall be Michael L. Ashner, T. Wilson Eglin and Brendan P. Mullinix.
The initial members of the Executive Committee appointed by Inland shall be Lori
Foust and Thomas McGuinness.
     “Exclusivity Right” is defined in Section 3.9(a)(ii) hereof.
     “Existing Indebtedness” shall mean the existing indebtedness encumbering
the Qualified Contribution Assets and the Qualified Sale Assets, the principal
balances as of August 1, 2007 are respectively set forth on Schedules 1 and 2.8
hereto.
     “Extraordinary Call” is defined in Section 5.1(c) hereof.
     “Extraordinary Call Cap” is defined in Section 5.1(c) hereof.
     “Extraordinary Capital Contribution” is defined in Section 5.1(c) hereof.
     “Extraordinary Funding” is defined in Section 5.1(c) hereof.
     “Fair Market Value” shall mean an amount (in cash) that a bona fide,
willing buyer under no compulsion to buy and a bona fide, willing and unrelated
seller under no compulsion to sell would pay and accept, respectively, for the
purchase and sale of a Qualified Asset, taking into account any liens,
restrictions and agreements then in effect and binding upon the Qualified Asset
or any successor owner thereof and any options, rights of first refusal or offer
or other rights or options that either burden the Qualified Asset or run to the
benefit of the owner of the Qualified Asset; provided, however, that in
determining the Fair Market Value of any Qualified Asset, none of the options,
rights of first refusal or offer or other rights of the Partners hereunder shall
be taken into consideration.

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     “General Partner” shall mean the Person appointed general partner of the
Partnership pursuant to the terms of this Agreement. The initial General Partner
shall be LMLP GP.
     “Gross Revenues” is defined in Section 3.10(a) hereof.
     “Indemnified Party” is defined in Section 3.12(a) hereof.
     “Initial Capital Contribution” shall mean, (a) with respect to Inland, the
amount of cash and (b) with respect to each LMLP Partner, the amount of cash and
the amount of the Contribution Value (as defined in the Contribution Agreement),
in each case as pursuant to Section 5.1 hereof, as set forth on Schedule 1
hereto.
     “Initiating Partner” is defined in Section 11.3(f) hereof.
     “Inland” is defined in the Preamble hereto.
     “Inland Priority Return” is defined in Section 7.1(b)(i)(A) hereof.
     “Letter Agreement” shall mean that certain Letter Agreement, dated as of
February 20, 2008, among Inland, LMLP and LMLP GP, as the same may be amended
from time to time upon agreement by each of the Partners.
     “Limited Partner” is defined in the Preamble hereto.
     “Liquidating Events” is defined in Section 9.1 hereof.
     “Liquidation” shall mean (a) when used with respect to the Partnership, the
date upon which the Partnership ceases to be a going concern, and (b) when used
with respect to any Partner, the earlier of (i) the date upon which there is a
Liquidation of the Partner and (ii) the date upon which such Partner’s entire
interest in the Partnership is terminated other than by transfer, assignment or
other disposition to a Person other than the Partnership.
     “Liquidator” shall mean any Person designated as such by a Supermajority
Vote of the Executive Committee.
     “Losses” and “Profits” are defined in Section 6.2(b) hereof.
     “LMLP” is defined in the Preamble hereto.
     “LMLP Affiliated Party” shall mean any LMLP Partner, the Asset Manager
and/or any of their respective Affiliates (but shall in no event include the
Partnership, any SP Subsidiary, Inland or any of its Affiliates).
     “LMLP GP” is defined in the Preamble hereto.
     “LMLP Partner” is defined in the Preamble hereto.
     “LMLP Priority Return” is defined in Section 7.1(b)(i)(C) hereof.

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     “LMLP Sale Affiliates” shall mean the LMLP Affiliates set forth on Schedule
2.8 hereto that are selling the Qualified Sale Assets to the Partnership
pursuant to Section 2.8 hereof.
     “LXP” shall mean Lexington Realty Trust, a Maryland real estate investment
trust, or its successors or assigns.
     “Major Decision” is defined in Section 3.4 hereof.
     “Majority Vote” shall mean the written consent of three (3) of the five
(5) members of the Executive Committee.
     “Management Agreement” shall mean the Management Agreement, dated as of
August 10, 2007, between the Asset Manager and the Partnership, a copy of which
is attached as Exhibit C hereto, and the agreement between any subsequent Asset
Manager and the Partnership, which shall be substantially in the form as the
Management Agreement attached hereto as Exhibit C, and which shall in all cases
provide that the Management Agreement may be terminated by the Partnership at
any time and the terms of which shall be monitored and enforced by the General
Partner.
     “Management Fees” shall mean the Property Management Fee and the
Partnership Management Fee.
     “Material Modification” shall mean a modification relating to the treatment
of Capital Accounts, distributions and/or allocations hereunder which, when
considered on a cumulative basis with the effect of all other such modifications
previously made, is likely to adversely affect the amount ultimately
distributable or paid to any Partner hereunder as determined by the independent
accountants of the Partnership.
     “Net Cash Flow” shall mean Net Cash Flow from Operations and Net Cash Flow
from Sales and Refinancings.
     “Net Cash Flow from Operations” shall mean Net Cash Flow from Operations of
Qualified Acquired Assets and Net Cash Flow from Operations of Qualified Assumed
Assets.
     “Net Cash Flow from Operations of Qualified Acquired Assets” shall mean the
gross revenues from Qualified Acquired Assets (excluding sales or other
dispositions or refinancings of Qualified Acquired Assets) less, without
duplication, the sum of any portion thereof used to (a) pay Operating Expenses,
capital improvements, replacements or debt payments related to the Qualified
Acquired Assets or the Qualified Acquired Assets Portion thereof; (b) pay the
Qualified Acquired Assets Portion of (i) the general and administrative costs
and overhead of the Partnership, (ii) any Management Fees payable to the General
Partner or Asset Manager pursuant to Section 3.10 hereof, (iii) any credits
reserved pursuant to Section 3.10 hereof, indemnities and other extraordinary
payments made pursuant to this Agreement; or (c) establish reasonable reserves
for Operating Expenses, capital improvements, replacements, debt payments and
contingencies as provided in the Annual Plan, in each case related to the
Qualified Acquired Assets or the Qualified Acquired Assets Portion thereof, as
such reserves are calculated, established and maintained by the General Partner
pursuant to Section 3.4. “Net

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Cash Flow from Operations of Qualified Acquired Assets” shall not be reduced by
real estate depreciation or by cost amortization, cost recovery deductions or
similar allowances related to the Qualified Acquired Assets, but shall be
increased by any related reduction of reserves related to the Qualified Acquired
Assets previously described in an Annual Plan.
     “Net Cash Flow from Operations of Qualified Assumed Assets” shall mean the
gross revenues from Qualified Assumed Assets (excluding sales or other
dispositions or refinancings of Qualified Assumed Assets) less, without
duplication, the sum of any portion thereof used to (a) pay Operating Expenses,
capital improvements, replacements or debt payments related to the Qualified
Assumed Assets or the Qualified Assumed Assets portion thereof; (b) pay the
Qualified Assumed Assets Portion of (i) the general and administrative costs and
overhead of the Partnership, (ii) any Management Fees payable to the General
Partner or Asset Manager pursuant to Section 3.10 hereof, (iii) any credits
reserved pursuant to Section 3.10 hereof, indemnities and other extraordinary
payments made pursuant to this Agreement; or (c) establish reasonable reserves
for Operating Expenses, capital improvements, replacements, debt payments and
contingencies as provided in the Annual Plan, in each case related to the
Qualified Assumed Assets or the Qualified Assumed Assets Portion thereof, as
such reserves are calculated, established and maintained by the General Partner
pursuant to Section 3.4. “Net Cash Flow from Operations of Qualified Assumed
Assets” shall not be reduced by real estate depreciation or by cost
amortization, cost recovery deductions or similar allowances related to the
Qualified Assumed Assets, but shall be increased by any related reduction of
reserves related to the Qualified Assumed Assets previously described in an
Annual Plan.
     “Net Cash Flow from Sales or Refinancings” shall mean Net Cash Flow from
Sales or Refinancings of Qualified Acquired Assets and Net Cash Flow from Sales
or Refinancings of Qualified Assumed Assets.
     “Net Cash from Sales or Refinancings of Qualified Acquired Assets” shall
mean the gross cash proceeds from the sale or other disposition or refinancing
or repayment or exercise of Qualified Acquired Assets less (a) any closing,
transaction and other costs incurred by the Partnership in connection with such
sale or other disposition or refinancing or repayment or exercise, as the case
may be; (b) the amount required to retire any debt outstanding against such
Qualified Acquired Assets; and (c) any amounts required to fund any related
reserves up to the levels required. Net Cash from Sales or Refinancings of
Qualified Acquired Assets shall be increased by releases of reserves previously
funded from Net Cash from Sales or Refinancings of Qualified Acquired Assets.
“Net Cash from Sales or Refinancings of Qualified Acquired Assets” shall include
all principal and interest payments made with respect to any note or other
obligation received by the Partnership in connection with the sale or other
disposition of any Qualified Acquired Asset.
     “Net Cash from Sales or Refinancings of Qualified Assumed Assets” shall
mean the gross cash proceeds from the sale or other disposition or refinancing
or repayment or exercise of Qualified Assumed Assets less (a) any closing,
transaction and other costs incurred by the Partnership in connection with such
sale or other disposition or refinancing or repayment or exercise, as the case
may be; (b) the amount required to retire any debt outstanding against such
Qualified Assumed Assets; and (c) any amounts required to fund any related
reserves up to the levels required. Net Cash from Sales or Refinancings of
Qualified Assumed Assets shall be

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increased by releases of reserves previously funded from Net Cash from Sales or
Refinancings of Qualified Assumed Assets. “Net Cash from Sales or Refinancings
of Qualified Assumed Assets” shall include all principal and interest payments
made with respect to any note or other obligation received by the Partnership in
connection with the sale or other disposition of any Qualified Assumed Asset.
     “9% Cash on Cash Return” shall mean, with respect to either Inland or LMLP
a return sufficient to achieve a 9% cash on cash annual yield calculated by
dividing (a) Distributable Cash distributed to such Partner by (b) the Capital
Contributions (including credited amounts under Section 3.10 hereof) made, plus,
(i) solely with respect to Inland, the Acquisition Fees (if any) paid by Inland,
or (ii) solely with respect to LMLP, 17.65% of the amount the Acquisition Fees
(if any) paid by Inland; provided, that if the Partnership fails to (i) make a
distribution to either Inland or LMLP in an amount equal to the applicable 9%
Cash on Cash Return on a Distribution Date, such amount shall accrue, and such
Partner shall be entitled to additional distributions on such accrued amount, at
the rate of 9% per annum compounded quarterly. For purposes of calculating
Inland’s 9% Cash on Cash Return, clause (b) hereof shall be increased by the
outstanding Cap Ex/Lease Assumed Asset Amount. For the avoidance of doubt, the
amount of Capital Contributions under clause (b) herein shall not include the
outstanding amount, if any, of Preferred Equity Capital Contributions for
purposes of calculating the 9% Cash on Cash Return.
     “Nonrecourse Liability” shall mean any Partnership liability (or portion
thereof) the Economic Risk of Loss of which is not borne by any Partner or any
party related to any Partner, as such related party is described in the
applicable Regulations under Code Section 752.
     “Non-Parameter Asset” is defined in Section 3.6(c) hereof.
     “Offer Price” shall mean the ROFO Offer Price or the Buy/Sell Offer Price,
as applicable.
     “Offered Agreement” is defined in Section 11.2(a) hereof.
     “O.P. Unit” shall mean a partnership interest in a partnership in which LXP
or its Affiliate is a partner.
     “Operating Expenses” shall mean (a) all reasonable and customary costs and
expenses of Third Parties retained in connection with the ownership, leasing,
operation, repair and maintenance of the Qualified Assets and (b) real estate
taxes, insurance premiums, utility charges, rent collection and lease
enforcement costs, brokerage commissions to the extent applicable to the period
in question (but excluding any Acquisition Fees payable to the Asset Manager
under Section 3.6(g) hereof), maintenance expenses, costs of repairs and
replacements (which, under generally accepted accounting principles consistently
applied, may be expensed during the period when made) and management fees
(including any Management Fees payable to the Asset Manager pursuant to
Section 3.10 hereof) in connection with the ownership, leasing, operation,
repair and maintenance of the Qualified Assets. Operating Expenses shall not
include general and administrative costs and overhead of the Partnership and
debt payments.

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     “Other Partner(s)” in respect of either or both of the LMLP Partners shall
mean Inland and in respect of Inland shall mean either or both of the LMLP
Partners.
     “Partially Adjusted Capital Account” shall mean, with respect to any
Partner for any taxable year of the Partnership, the Capital Account balance of
such Partner at the beginning of such year, adjusted for all contributions and
distributions during such year and all special allocations pursuant to
Section 6.3 hereof with respect to such year but before giving effect to any
allocations pursuant to Section 6.2 hereof with respect to such year.
     “Partner” is defined in the Preamble hereto.
     “Partner Nonrecourse Debt” shall have the meaning set forth in Regulations
Section 1.704-2(b)(4).
     “Partner Nonrecourse Debt Minimum Gain” shall have the meaning set forth in
Regulations Section 1.704-2(i)(2).
     “Partner Nonrecourse Deductions” is defined in Section 6.3(d) hereof.
     “Partnership” is defined in the Preamble hereto.
     “Partnership Management Fee” is defined in Section 3.10(b) hereof.
     “Partnership Minimum Gain” shall have the meaning set forth in
Section 1.704-2(b)(2) and (d) of the Regulations.
     “Percentage Interest” shall mean the entire undivided ownership interest in
the Partnership of any Partner at any particular time, (a) expressed as a
percentage rounded to the nearest one one-hundredth (0.01%), (b) determined at
such time by dividing the total Capital Contributions (excluding Preferred
Equity Capital Contributions) made by such Partner by the total Capital
Contributions (excluding Preferred Equity Capital Contributions) made to the
Partnership by all Partners and (z) as may be adjusted from time to time in
accordance with the terms hereof. The Percentage Interest of each Partner as of
the date first set forth above shall be as described on Schedule 1 hereto
(without regard to the Preferred Equity Capital Contribution).
     “Permitted Expenses” shall mean, for each annual period covered by an
Annual Plan, Operating Expenses, capital improvements, replacements and debt
payments as set forth therein plus, with respect to each budget line item in the
Annual Budget portion of such Annual Plan, the greater of (a) five percent (5%)
of each such budget line item or (b) Twenty Thousand Dollars ($20,000.00);
provided, however, that the aggregate Permitted Expenses (other than the
Management Fees payable to the Asset Manager pursuant to Section 3.10 hereof),
when added to all other obligations incurred or reserve amounts accrued in
excess of the applicable budget line items in such Annual Budget portion of the
Annual Plan, shall not exceed (i) One Hundred Thousand Dollars ($100,000) in any
fiscal year for a particular Qualified Asset or (ii) an average (taking into
account all Qualified Assets then owned by the Partnership) of Fifty Thousand
Dollars ($50,000) per Qualified Asset. Permitted Expenses shall also mean
(a) all reasonable and customary costs and expenses of Third Parties retained in
connection with the Acquisition Activities as provided in Section 3.6(f) hereof,
(b) any reasonable costs or expenses incurred in

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implementing a Major Decision approved as provided in Section 3.4 hereof and not
otherwise already included in an Annual Plan, and (c) costs and expenses
incurred by and on behalf of the Partnership in connection with the formation of
the Partnership, including legal fees and costs and expenses associated with
assumption or refinancing the Existing Indebtedness, but excluding fees and
expenses set forth in Section 12.16 hereof.
     “Person” shall mean any individual, trust (including a business trust),
unincorporated association, corporation, limited liability company, joint stock
company, general partnership, limited partnership, joint venture, governmental
authority or other entity.
     “Physical Inspection Report” shall mean a report prepared by a qualified
independent third party engineer, architect or other real estate inspector
selected by the General Partner concerning the physical condition of any
Proposed Qualified Asset.
     “Plan Amendment” is defined in Section 3.5(c).
     “Preferred Equity” shall mean the Preferred Equity Capital Contribution by
LMLP pursuant to Section 5.2 hereof.
     “Preferred Equity Capital Contribution” shall mean the contribution to the
Partnership by LMLP pursuant to Section 5.2 hereto.
     “Preferred Equity Redemption Amount” shall mean one hundred and twenty five
(125%) percent of the allocated amount of the outstanding Preferred Equity
Capital Contribution set forth opposite a Qualified Assumed Asset on Schedule 1
hereto; provided, that for the purposes of Section 3.8(e) hereof only, if LMLP
is no longer the General Partner because of an Event of Default caused by an
LMLP Partner or an LMLP Affiliated Party, then the Preferred Equity Redemption
Amount shall mean one hundred percent (100%) of the allocated amount of the
Outstanding Preferred Equity Capital Contribution set forth opposite a Qualified
Assumed Asset on Schedule 1 hereto.
     “Preferred Equity Return” shall mean a cumulative distribution on the
outstanding Preferred Equity paid quarterly in accordance with Section 7.1
hereof at a rate of 6.5% per annum; provided, that if the Partnership fails to
(i) make a distribution to LMLP in an amount equal to the Preferred Equity
Return on a Distribution Date, such amount shall accrue, and LMLP shall be
entitled to additional distributions on such accrued amount, at the rate of 6.5%
per annum compounded quarterly, or (ii) redeem any Preferred Equity when such
redemption is required hereunder, such redemption amount shall accrue, and LMLP
shall be entitled to additional distributions on such accrued amount, at the
rate of 10.5% per annum compounded quarterly.
     “Prior Agreement” is defined in the Preamble hereto.
     “Priority Loan” is defined in Section 5.1(a) hereof.
     “Priority Return” shall mean the Inland Priority Return and/or the LMLP
Priority Return, as applicable.

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     “Profits” and “Losses” are defined in Section 6.2(b) hereof.
     “Property Management Fee” is defined in Section 3.10(a) hereof.
     “Proposed Plan” is defined in Section 3.5(a) hereof.
     “Proposed Qualified Asset” is defined in Section 3.6(a) hereof.
     “Purchase Agreement” shall mean the Purchase Agreement, dated as of
August 10, 2007, pursuant to which the Partnership purchases the Qualified Sale
Assets from the LMLP Sale Affiliates pursuant to Section 2.8 hereof and a copy
of which is attached as Exhibit D to this Agreement.
     “Purchasing Partner” shall mean the purchasing Partner under Section 11.1
or Section 11.2 hereof, as the case may be.
     “Purchase Price” shall mean (a) with respect to each Qualified Contribution
Asset, the Contribution Value which will be set forth on Schedule 1 to the
Contribution Agreement upon acquisition of the Qualified Contribution Asset,
(b) with respect to each Qualified Sale Asset, the Sales Price which will be set
forth on Schedule 1 to the Purchase Agreement upon acquisition of the Qualified
Sale Asset, and (c) with respect to each other Qualified Asset, the gross
purchase cost of the Qualified Asset.
     “Qualified Acquired Assets” shall mean the Qualified Assets acquired by the
Partnership pursuant to Section 3.6 hereof, but shall not include Qualified
Assumed Assets.
     “Qualified Acquired Assets Portion” shall mean a portion of an applicable
amount determined by dividing such amount by a quotient, the numerator of which
is the gross acquisition cost of the Qualified Acquired Assets and the
denominator of which is the gross acquisition cost of the Qualified Assets.
     “Qualified Asset” or “Qualified Assets” shall mean the direct or indirect
interest of the Partnership in (a) each Approved Qualified Asset and
Non-Parameter Asset acquired by the Partnership pursuant to Section 3.6 hereof,
and (b) the Qualified Assumed Assets.
     “Qualified Assumed Assets” shall mean the Qualified Contribution Assets and
the Qualified Sale Assets.
     “Qualified Assumed Assets Portion” shall mean a portion of an applicable
amount determined by dividing such amount by a quotient, the numerator of which
is the gross acquisition cost of the Qualified Assumed Assets and the
denominator of which is the gross acquisition cost of the Qualified Assets.
     “Qualified Contribution Assets” shall mean the assets set forth on
Schedule 1, each of which shall be a Qualified Asset upon contribution to the
Partnership pursuant to the Contribution Agreement and Section 5.1(a) hereof.

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     “Qualified Sale Assets” shall mean the interests of the LMLP Sale
Affiliates in the assets set forth on Schedule 2.8, each of which shall be a
Qualified Asset upon acquisition by the Partnership pursuant to the Purchase
Agreement.
     “Recoverable Amounts” is defined in Section 3.10(a) hereof.
     “Regulations” shall mean the income tax regulations promulgated under the
Code, whether temporary, proposed or finalized, as such regulations may be
amended from time to time (including corresponding provisions of future
regulations).
     “Regulatory Allocations” is defined in Section 6.3(f) hereof.
     “REIT” shall mean “real estate investment trust” within the meaning of
Sections 856-860 of the Code.
     “Remaining Qualified Assumed Assets Capital Contribution” shall mean,
(a) with respect to Inland, the amount of cash and (b) with respect to each LMLP
Partner, the amount of cash and/or the amount of the Contribution Value (as
defined in the Contribution Agreement), in each case as pursuant to
Section 5.1(a) hereof and made prior to June 30, 2008 and as set forth on
Schedule 1 hereto, which shall be amended and restated to reflect each the
acquisition of each Qualified Assumed Asset acquired after the date hereof.
     “Removal Event” shall mean (a) an Event of Default caused by an LMLP
Partner or an LMLP Affiliated Party or (b) a Change of Control.
     “Required Third Party Price” is defined in Section 11.1(a) hereof.
     “Responding Partner” shall mean the ROFO Responding Partner or the Buy/Sell
Responding Partner, as applicable.
     “Rights Trigger Date” shall mean the earliest of the following: (a) the
fourth anniversary of the date first set forth above; (b) an Event of Default;
(c) a Change of Control; (d) termination of the Management Agreement by the
Partnership; and (e) a Removal Event.
     “ROFO Notice” is defined in Section 11.1(a) hereof.
     “ROFO Offer Price” is defined in Section 11.1(a) hereof.
     “ROFO Offering Partner” is defined in Section 11.1(a) hereof.
     “ROFO Responding Partner” is defined in Section 11.1(a) hereof.
     “ROFO Response Notice” is defined in Section 11.1(a) hereof.
     “ROFO Terms” is defined in Section 11.1(a) hereof.
     “Section 704(c) Property” shall mean (a) each item of property to which
Section 704(c) of the Code or Section 1.704-3(a)(3) of the Regulations applies
that is contributed to the Partnership, and (b) any property owned by the
Partnership which is governed by the principles of Section 704(c) of the Code,
as contemplated by Section 1.704-1(b)(4)(i) and other analogous provisions of
the Regulations.

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     “Selling Partner” shall mean the selling Partner under Section 11.1 or
Section 11.2 hereof, as the case may be.
     “SP Subsidiary” shall mean an entity selected by the General Partner which
shall be wholly-owned (directly or indirectly) by the Partnership, the purpose
of which is limited to acquiring, financing, holding for investment, preserving,
managing, operating, improving, leasing, selling, exchanging, transferring and
otherwise using or disposing of a Qualified Asset or Qualified Assets.
     “SP Subsidiary Limited Liability Company Agreement” shall mean the limited
liability company agreement of an SP Subsidiary that is the general partner of
another SP Subsidiary, which, except as provided in Section 3.4 hereof, shall be
substantially in the form attached hereto as Exhibit E.
     “SP Subsidiary Partnership Agreement” shall mean the limited partnership
agreement of an SP Subsidiary that is the owner of a Qualified Asset, which,
except as provided in Section 3.4 hereof, shall be substantially in the form
attached hereto as Exhibit F.
     “SP Subsidiary Agreements” shall mean the SP Subsidiary Limited Liability
Company Agreements and the SP Subsidiary Partnership Agreements.
     “Supermajority Vote” shall mean the written consent of four (4) of the five
(5) members of the Executive Committee.
     “Target Account” shall mean, with respect to any Partner for any taxable
year of the Partnership, the excess of (a) an amount (which may be either a
positive balance or a negative balance) equal to the hypothetical distribution
(or contribution) such Partner would receive (or contribute) if all assets of
the Partnership, including cash, were sold for cash equal to their Book Basis
(taking into account any adjustments to Book Basis for such year), all
liabilities (including prepayment penalties, yield maintenance fees and similar
costs) of the Partnership were then satisfied according to their terms (except
that if the nonrecourse liabilities secured by an asset exceed the Book Basis of
such asset, such calculation shall be made assuming that the asset were
transferred to the lender in satisfaction of the debt) and all remaining
proceeds from such sale were distributed pursuant to Section 9.2 over (b) such
Partner’s share of Partnership Minimum Gain and Partner Nonrecourse Debt Minimum
Gain immediately prior to such sale.
     “Tax Depreciation” shall mean with respect to any property owned by the
Partnership depreciation, accelerated cost recovery, or modified cost recovery,
and any other amortization or deduction allowed or allowable for federal, state
or local income tax purposes.
     “Tax Matters Partner” is defined in Section 6.5 hereof.
     “Third Parties” shall mean consultants, engineers, environmental
consultants, accountants, attorneys, contractors and subcontractors, brokers or
managers, but excluding any LMLP Affiliated Party.

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     “Third Party Sale Period” is defined in Section 11.1(b) hereof.
ARTICLE II
FORMATION, DURATION AND PURPOSES; PURCHASE OF INITIAL PROPERTIES
               Section 2.1 Formation. Pursuant to the Delaware Revised Uniform
Limited Partnership Act, codified in the Delaware Code Annotated, Title 6,
Sections 17-101 to 17-1111, as the same may be amended from time to time (the
“Act”), the Partners agree to form and hereby form the Partnership by entering
into this Agreement. The Partners hereby acknowledge that a certificate of
limited partnership has been executed and filed in the office of the Delaware
Secretary of State on August 8, 2007. The execution and filing of such
certificate of limited partnership with the Delaware Secretary of State is
hereby authorized, ratified and approved by the Partners. The rights,
liabilities and obligations of any Partner with respect to the Partnership shall
be determined in accordance with the Act and this Agreement. To the extent
anything contained in this Agreement modifies, supplements or otherwise affects
any such right, liability, or obligation arising under the Act, this Agreement
shall supercede the Act to the extent not restricted thereby.
               Section 2.2 Name; Registered Agent and Registered Office. The
name of the Partnership and the name under which the business of the Partnership
shall be conducted shall be “Net Lease Strategic Assets Fund L.P.” The
registered agent of the Partnership shall be Corporation Service Company, and
the registered office of the Partnership shall be at Corporation Service
Company, 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808. The
General Partner may select another such registered agent or registered office
from time to time.
               Section 2.3 Principal Office. The principal place of business and
office of the Partnership shall be located at c/o The Lexington Master Limited
Partnership, One Penn Plaza, Suite 4015, New York, New York 10119-4015, or at
such other place as the General Partner may determine from time to time. The
business of the Partnership may also be conducted at such additional place or
places as the General Partner may determine.
               Section 2.4 Purposes and Business. The business of the
Partnership is to, directly or indirectly, acquire, finance, refinance, hold for
investment, preserve, manage, operate, improve, lease, sell, exchange, transfer
and otherwise use or dispose of the Qualified Assets as may be, directly or
indirectly, acquired by the Partnership from time to time pursuant to the terms
hereof, which Qualified Assets may be located anywhere in the United States. In
connection therewith and without limiting the foregoing, the Partnership shall
have the power to dispose of the Qualified Assets in accordance with the terms
of this Agreement and to engage in any and all activities related or incidental
thereto, all for the benefit of the Partners.
               Section 2.5 Term. The term of the Partnership shall commence on
the date of this Agreement and shall continue in full force and effect until
terminated pursuant to the terms hereof. No Partner may withdraw from the
Partnership without the prior consent of the General Partner, other than as
expressly provided in this Agreement.

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               Section 2.6 Other Qualifications. The Partnership shall file or
record such documents and take such other actions under the laws of any
jurisdiction in which the Partnership does business as are necessary or
desirable to permit the Partnership to do business in any such jurisdiction and
to promote the limitation of liability for the Partners in any such
jurisdiction.
               Section 2.7 Limitation on the Rights of Partners. Except as
otherwise specifically provided in this Agreement, (a) no Partner shall have the
right to withdraw or retire from, or reduce its contribution to the capital of,
the Partnership; (b) no Partner shall have the right to demand or receive assets
other than cash in return for its Capital Contribution; and (c) no Partner shall
have priority over any other Partner either as to the return of its Capital
Contribution or as to profits or distributions.
               Section 2.8 Purchase of Qualified Sale Assets. The LMLP Sale
Affiliates have agreed to sell, and the Partnership has agreed to purchase the
Qualified Sale Assets described on Schedule 2.8 hereto at the purchase prices
set forth on Schedule 2.8 hereto pursuant to the Purchase Agreement.
               Section 2.9 Remuneration To Partners. No Partner is entitled to
remuneration for acting on behalf of the Partnership. Except as otherwise
authorized in this Agreement, including but not limited to Sections 3.6 and
3.10, no Partner is entitled to remuneration for acting in the Partnership
business.
ARTICLE III
MANAGEMENT RIGHTS, DUTIES, AND POWERS
OF THE GENERAL PARTNER; TRANSACTIONS INVOLVING PARTNERS
               Section 3.1 Management.
               (a) Management by the General Partner. LMLP GP shall be the
General Partner until (x) a Removal Event, or (y) LMLP GP resigns as the General
Partner. The General Partner shall manage the investments, business and
day-to-day affairs of the Partnership and shall be responsible for acquisitions
and dispositions of Qualified Assets, subject, however, to the provisions of
Section 3.4 hereof with respect to Major Decisions, of Section 3.6, Section 3.7
and Article XI hereof with respect to the acquisition or sale of Qualified
Assets and any other provisions of this Agreement concerning the investments,
business and day-to-day affairs of the Partnership. The General Partner shall
use commercially reasonable efforts to manage the investments, business and
day-to-day affairs of the Partnership in accordance with the Annual Plan
approved in accordance with Section 3.5 hereof. Any action taken by the General
Partner in accordance with the terms of this Agreement shall constitute the act
of and serve to bind the Partnership. The General Partner may delegate certain
of the tasks that are to be performed in connection with the acquisition of
Qualified Assets, the management of the Qualified Assets or the business and
day-to-day affairs of the Partnership. Any such delegation to third parties
provided in the previous sentence shall be at the cost of the General Partner
and supervised by the General Partner and such delegation shall not relieve the
General Partner of

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any of its obligations hereunder. Any right of any Partner to consent to any
action requiring its consent hereunder shall not be diminished or otherwise
affected by such delegation.
               (b) Delegation to the Executive Committee.
          (i) The Executive Committee shall be delegated the authority to
exercise the authority conferred on it by this Agreement. No member of the
Executive Committee shall (x) have any interest in or rights under this
Agreement, (y) be admitted as a substitute for any Partner or (z) have any of
the rights of a Partner under the Act or this Agreement.
          (ii) Action requiring a Supermajority Vote by the Executive Committee
shall be taken without a meeting by a consent in writing setting forth the
action taken, which shall be signed by at least four (4) of the five (5) members
of the Executive Committee. Action requiring a Majority Vote of the Executive
Committee shall be taken at a special meeting of the Executive Committee, upon
not less than five (5) Business Days’ prior written notice by the General
Partner to the members of the Executive Committee. Such meetings shall be held
at the time specified in the notice at a location selected by the General
Partner or, if requested by any member of the Executive Committee, by
teleconference.
          (iii) Any member of the Executive Committee may resign at any time by
giving written notice to each Partner. The resignation of any member of the
Executive Committee shall take effect upon receipt of the notice thereof or at
such later time as shall be specified in such notice; and, unless otherwise
specified therein, the acceptance of such resignation shall not be necessary to
make such resignation effective. The Partner who appointed the resigning
Executive Committee member shall appoint a replacement Executive Committee
member within seven (7) Business Days of such resignation. Any Partner who
appointed an Executive Committee member may remove such member at any time upon
written notice to the other Partners, which notice shall name and appoint a new
Executive Committee member to replace the Executive Committee member so removed.
          (iv) The members of the Executive Committee shall not be entitled to
receive any fees or reimbursement for any expenses for their service in such
capacity.
               (c) Delegation to the Asset Manager. The General Partner shall
retain the Asset Manager pursuant to a Management Agreement substantially in the
from attached hereto as Exhibit C and delegate (pursuant to Sections 3.1(a) and
(b) above) to the Asset Manager the management of the Qualified Assets and,
during the Acquisition Period, the performance of the tasks necessary for the
evaluation of Proposed Qualified Assets and the acquisition of Approved
Qualified Assets as contemplated in Section 3.6 hereof. The Asset Manager shall
(x) have no interest in or rights under this Agreement, (y) not be admitted as a
substitute for any Partner and (z) not have any of the rights of a Partner under
the Act or this Agreement. Any delegation to the Asset Manager provided in this
Section 3.1(b) shall be supervised by the General Partner and the Executive
Committee and such delegation shall not relieve the General Partner of any of
its obligations hereunder as General Partner.

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               (d) Right to Rely on Authority of the General Partner. Any action
taken by the General Partner, acting on behalf of the Partnership pursuant to
the authority conferred thereon in this Agreement, shall be binding on the
Partnership. In no event shall any Person dealing with the General Partner with
respect to the conduct of the affairs of the Partnership be obligated to
ascertain whether the terms of this Agreement have been complied with, or be
obligated to inquire into the necessity or expediency of any action of the
General Partner.
               (e) Inland’s Right to Enforce Partnership Rights Against LMLP
Affiliated Parties. Notwithstanding anything herein to the contrary, if LMLP GP,
in its capacity as General Partner, has failed to enforce any of the
Partnership’s rights against any LMLP Affiliated Party that has defaulted on any
obligation owed to the Partnership under this Agreement, the Contribution
Agreement, the Purchase Agreement or any agreement between the Partnership and
any LMLP Affiliated Party (including the Management Agreement), Inland shall be
entitled to exercise, on behalf of the Partnership and at the expense of the
Partnership, the Partnership’s rights and obligations arising under such
agreements all without the consent or approval of LMLP GP or the Executive
Committee.
               Section 3.2 Actions of the General Partner.
               (a) Acts of the General Partner. Any action required or permitted
to be taken by the General Partner shall be taken by written consent of the
General Partner, and the writing or writings shall be filed with the books and
records of the Partnership.
               (b) General Informational Meetings. The General Partner shall
hold informational meetings with the Partners to review and discuss the
Partnership’s activities and business at least once annually and, so long as
LMLP GP is the general partner and if requested by Inland upon not less than ten
(10) Business Days’ prior written notice, at least once quarterly. Such meetings
shall be held at a mutually convenient time at a location selected by the
General Partner and teleconferencing will be made available.
               Section 3.3 Authority of the General Partner.
               (a) Except as otherwise provided in this Article III, the General
Partner is hereby authorized to do the following, for and in the name and on
behalf of the Partnership, as may be necessary, convenient or incidental to the
implementation of the Annual Plan or to the accomplishment of the purposes of
the Partnership (provided, that if any of the following constitutes a Major
Decision that is not specifically set forth in the Annual Plan, the General
Partner shall first obtain the consent of the Executive Committee pursuant to
Section 3.4 hereof):
          (i) enter into a good faith non-binding letter of intent concerning
the acquisition of a Proposed Qualified Asset.
          (ii) acquire by purchase, exchange or otherwise, any Proposed
Qualified Asset consistent with the purposes of the Partnership, but only in
accordance with Sections 3.4 and  3.6 hereof;

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          (iii) operate, manage and maintain each of the Qualified Assets;
          (iv) take such action as is necessary to form, create or set up any SP
Subsidiary that has been approved in accordance with Section 3.6 hereof;
          (v) dissolve, terminate or wind-up any SP Subsidiary, provided that
any Qualified Asset held by such SP Subsidiary has been disposed of in
accordance with Article XI hereof or transferred to the Partnership or any other
SP Subsidiary;
          (vi) enter into, amend, extend or renew any lease of any Qualified
Asset or any part thereof or interest therein approved as part of the Annual
Plan;
          (vii) initiate legal proceedings or arbitration with respect to any
lease of any Qualified Asset or part thereof or interest therein; provided that
the initiation of such legal proceedings or arbitration shall have arisen (x) in
connection with any matter of an emergency nature, (y) for the collection of
rent or (z) involving an uninsured claim of less than $100,000;
          (viii) dispose of any or all of the Qualified Assets by sale, lease,
exchange or otherwise, and grant an option for the sale, lease, exchange or
otherwise of any or all the Qualified Assets, but only in accordance with
Section 3.7 hereof;
          (ix) employ and dismiss from employment any and all employees, agents,
independent contractors, attorneys and, subject to Section 3.4 hereof,
independent accountants for the Partnership;
          (x) pay all Permitted Expenses (and maintain in reserve the amount of
any credits pursuant to Section 3.10 hereof);
          (xi) execute and deliver any and all agreements, contracts, documents,
certifications and instruments necessary or convenient in connection with the
management, maintenance and ownership of the Qualified Assets and in connection
with any other matters with respect to which the General Partner has authority
to act pursuant to the Annual Plan or as set forth in this Section 3.3;
          (xii) draw down funds as needed under any approved lines of credit or
other financing previously approved under Section 3.4 hereof;
          (xiii) finance or refinance a portion of the purchase price of any
Qualified Asset and incur (and refinance) indebtedness secured by any Qualified
Asset, or any portion thereof or any interest or estate therein and incur any
other secured or unsecured borrowings or other indebtedness;
          (xiv) implement those Major Decisions that are specifically set forth
in the Annual Plan or that have been approved by the Executive Committee
pursuant to Section 3.4 below; and

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          (xv) subject to any conditions expressly provided in this Agreement,
engage in any kind of activity and perform and carry out contracts of any kind
necessary or incidental to or in connection with the accomplishment of the
purposes of the Partnership as may be lawfully carried out or performed by a
limited partnership under the laws of each state in which the Partnership is
then formed or registered or qualified to do business.
               Section 3.4 Major Decisions.
               (a) Major Decisions. Notwithstanding anything to the contrary
contained in this Agreement, but subject to Section 3.4(b), Section 3.8(e) and
Section 3.8(f) hereof, the General Partner shall not take, on behalf of the
Partnership, and shall not permit the Partnership or the Asset Manager to take,
any action, make any decision, expend any sum or undertake or suffer any
obligation which comes within the scope of any Major Decision unless such Major
Decision is approved by the Executive Committee in the manner required by
Section 3.4(b) in advance in writing or as specifically set forth in the Annual
Plan.
               As used herein, “Major Decision” shall mean a decision to take
any of the following actions directly or indirectly through or for an SP
Subsidiary:
          (i) the acquisition (including any decisions under Section 3.6) by
purchase, exchange or otherwise of any Qualified Asset or other asset and except
for the acquisition of the Qualified Assumed Assets; provided that acquisitions
of Qualified Assets shall only occur during the Acquisition Period;
          (ii) the construction, alteration, improvement, repair,
rehabilitation, razing, rebuilding or replacement of any building or other
improvements or the making of any capital improvements, replacements, repairs,
alterations or changes in, to or on any Qualified Asset, or any part thereof,
except to the extent provided for in the Annual Plan; provided that repairs of
an emergency nature may be undertaken without prior approval of a majority of
the members of the Executive Committee provided the General Partner notifies
each member of the Executive Committee in writing thereof within two
(2) Business Days following the commencement of such emergency repairs;
          (iii) the reinvestment for restoration purposes of (i) insurance
proceeds in excess of $500,000 received by the Partnership in connection with
the damage or destruction of any Qualified Asset or (ii) condemnation proceeds
in excess of $500,000 received by the Partnership in connection with the taking
or settlement in lieu of a threatened taking of all or any portion of any
Qualified Asset; provided that (x) if the determination is made not to reinvest
any such insurance or condemnation proceeds, then so much thereof as may be
necessary shall be applied to the razing or other disposition of the remaining
improvements as may be required by law or by a reasonably prudent property
manager and the balance of such insurance or condemnation proceeds shall be
distributed in accordance with this Agreement and (y) any distribution of such
insurance or condemnation proceeds shall be made in accordance with
Section 7.1(c) hereof.
          (iv) the commencement of any case, proceeding or other action seeking
protection for the Partnership as debtor under any existing or future law of any

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jurisdiction relating to Bankruptcy, insolvency, reorganization or relief of
debtors; any consent to the entry of an order for relief in or institution of
any case, proceeding or other action brought by any third party against the
Partnership as a debtor under any existing or future law of any jurisdiction
relating to Bankruptcy, insolvency, reorganization or relief of debtors; the
filing of an answer in any involuntary case or proceeding described in the
previous clause admitting the material allegations of the petition therefor or
otherwise failing to contest any such involuntary case or proceeding; the
seeking of or consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator, custodian or any similar official for the Partnership or
for a substantial portion of its Qualified Assets; any assignment for the
benefit of the creditors of the Partnership; or the admission in writing that
the Partnership is unable to pay its debts as they mature or that the
Partnership is not paying its debts as they become due;
          (v) the extension of the statute of limitations for assessing or
computing any tax liability against the Partnership or the amount of any
Partnership tax item or to settle any dispute with respect to any income, or any
other material, tax;
          (vi) a merger, sale or recapitalization of the Partnership or a sale
or other disposition, including a disposition by lease, of any or all of the
Qualified Assets, except in accordance with Article XI hereof;
          (vii) the financing or refinancing of, or the increasing of any
mortgage indebtedness encumbering, any Qualified Asset, or any portion thereof
or any interest or estate therein, whether recourse or non-recourse to the
Partnership, or the incurrence of indebtedness secured by any Qualified Asset,
or any portion thereof or any interest or estate therein, or the incurrence of
any other secured or unsecured borrowings or other indebtedness by the
Partnership, including determination of the terms and conditions thereof, and
any amendments to such terms and conditions or otherwise with respect to
anything in this clause (vii) except (A) in accordance with Section 3.8(f)
hereof or (B) as contemplated in an Annual Plan or in accordance with
Section 3.4 hereof;
          (viii) the approval of the Annual Plan, including any budget line
item, and any amendment to the Annual Plan;
          (ix) the incurring of any cost or expense for any fiscal year, other
than a Permitted Expense;
          (x) the entering into of any transaction or agreement with or for the
benefit of, or the employment or engagement of, any LMLP Affiliated Party,
except as expressly contemplated in Sections 3.1(c) and 3.10 hereof;
          (xi) except as required by the lenders under the loan documents
governing indebtedness of the Partnership, the establishment of a reserve for
working capital, capital expenditures or to pay other costs and expenses
incident to ownership of the Qualified Assets and for such other Partnership
purposes in excess of an aggregate of (A) $100,000 or (B) $500,000;
          (xii) the initiation of legal proceedings or arbitration by the
Partnership or the settlement of any litigation against the Partnership
involving an uninsured

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claim in excess of (A) $100,000 or (B) $500,000; provided that the initiation of
such legal proceedings or arbitration (x) in connection with any matter of an
emergency nature, or (y) for the collection of rent, shall not be a Major
Decision subject to this Section 3.4(a);
          (xiii) with respect to any lease of any Qualified Asset, or part
thereof or interest therein, the entering into, amending, extending or renewing
thereof, in each case not already approved as part of the Annual Plan;
          (xiv) the admission of a new Partner to the Partnership or acquisition
by an existing Partner of an additional interest in the Partnership, except in
accordance with Article VIII and XI hereof;
          (xv) the engagement of an accounting firm to audit the financial
statements of the Partnership;
          (xvi) the extension of the Acquisition Period, which decision to
extend shall be made not less than 60 days prior to the end of the Acquisition
Period;
          (xvii) making an Extraordinary Call to the Partners to fund an
operating deficit of the Partnership in excess of the Extraordinary Call Cap;
          (xviii) except in connection with items set forth in the Annual Budget
or items constituting a Permitted Expense, the entry into any agreement by the
Partnership involving more than $100,000 of consideration or having a term in
excess of 1 year and in all cases any property management agreement or brokerage
agreement;
          (xix) the winding up or dissolution of the Partnership;
          (xx) any deviation from the SP Subsidiary Agreements, which directly
or indirectly impairs the economic or management rights of the Partnership; and
          (xxi) subject to Section 3.3 hereof, the execution of any agreement,
contract or understanding or other arrangement to effectuate a Major Decision.
                    (b) Vote Required. Major Decisions shall require the
following approvals:
               (i) A Supermajority Vote shall be required for the Major
Decisions set forth in Section 3.4(a)(i)-(iv), (vi)-(x), (xi)(B), (xii)(B) and
(xiii)-(xxi).
               (ii) A Majority Vote shall be required for the Major Decisions
set forth in Section 3.4 (v), (xi)(A) and (xii)(A).
                    (c) Non-Binding Letters of Intent. Notwithstanding the
foregoing, the General Partner shall be authorized to execute non-binding
letters of intent with respect to property and operational actions that
constitute Major Decisions.

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               Section 3.5 Preliminary and Annual Plans.
               (a) Preparation and Approval of Plans. The General Partner shall
prepare and deliver to the Executive Committee for its approval or disapproval a
proposed annual plan for the next fiscal year of the Partnership (as further
described below, a “Proposed Plan”). The Proposed Plan shall cover the
Partnership and each Qualified Asset and shall include:
          (i) a proposed Annual Budget covering the Partnership and each
Qualified Asset and a brief narrative description of the material portions
thereof;
          (ii) a plan of operations for each Qualified Asset, including
anticipated repairs and improvements;
          (iii) estimated financing needs and estimated financing costs for the
Partnership and each Qualified Asset;
          (iv) estimated cash flow projections for the Partnership and each
Qualified Asset;
          (v) a description of tenants then in occupancy in each Qualified
Asset;
          (vi) a schedule of Qualified Assets, any leases which are expiring
during such fiscal year and the plans for the re-leasing of such Qualified
Assets and any lease restructures (such as subleasing or expansion by a tenant)
of which the General Partner is aware;
          (vii) projected capital improvements and capital repairs;
          (viii) a description of any Proposed Qualified Assets to the extent
identified, including the terms of acquisition, provided that nothing in the
Proposed Plan shall affect or limit the provisions of Section 3.6 hereof; and
          (ix) any other information relative to the management of the Qualified
Assets or the Partnership reasonably requested by any member of the Executive
Committee.
               The General Partner shall prepare and submit a Proposed Plan to
the Executive Committee on or before November 15th of the year prior to such
fiscal year. The Executive Committee shall approve or disapprove such revised
Proposed Plan no later than December 15th of the year prior to the fiscal year
covered by such revised Proposed Plan. Any Proposed Plan approved by the
Executive Committee in accordance with Section 3.4 shall become the annual plan
for the next fiscal year of the Partnership (any Proposed Plan approved by the
Executive Committee for any fiscal year of the Partnership, and as may be
amended from time to time by a Plan Amendment, an “Annual Plan”). A model of an
Annual Plan is attached as Schedule 3.5 and made a part hereof. The General
Partner, within thirty (30) days after the closing of the last to be acquired of
Qualified Assumed Assets, shall submit the initial Annual

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Plan, covering all of the Qualified Assets held by the Partnership for the
remainder of the then current year, to the Executive Committee for approval or
disapproval in accordance with the procedures outlined herein which Proposed
Plan upon approval shall become the Annual Plan.
               (b) Dispute Concerning an Annual Budget. If, prior to the
commencement of any fiscal year, the Executive Committee has disapproved the
Proposed Plan because it could not reach an agreement as to the amount to be
allocated to any budget line item set forth in the Annual Budget portion of the
Proposed Plan for such fiscal year, then (i) as to any such disputed budget line
item, the Annual Budget portion of the Annual Plan for the immediately preceding
fiscal year (exclusive of any non-recurring capital expenditures) shall be
controlling but only with respect to such disputed budget line item (in each
case adjusted to reflect the increases in the CPI for November of such fiscal
year over the CPI for November of such immediately preceding fiscal year) and
only until such time as the Executive Committee has approved the amount to be
allocated to such budget line item, and (ii) as to any budget line item or items
that are not in dispute, the Annual Budget portion of the Proposed Plan shall
control.
               (c) Amendments to Annual Plans. If in any Partner’s judgment an
Annual Plan requires amendment, such Partner shall deliver to the Executive
Committee a written notice setting forth the proposed amendment to the Annual
Plan and the basis therefor. The Executive Committee shall approve or
disapprove, in accordance with Section 3.4 hereof, such proposed amendment
within ten (10) Business Days after receipt thereof, and, if the Executive
Committee shall approve such proposed amendment (any such amendment, a “Plan
Amendment”), the Annual Plan (including, without limitation any amendments to
the Annual Budget portion thereof) shall be amended by the Plan Amendment as set
forth in the written notice described in the preceding sentence. If the
Executive Committee shall disapprove a Plan Amendment, then the Annual Plan then
in effect shall not be amended pursuant to such disapproved Plan Amendment.
               Section 3.6 Qualified Asset Acquisitions.
               (a) Generally; Approval by Executive Committee. During the
Acquisition Period, LMLP GP shall identify net-leased assets that meet the
Acquisition Parameters as candidates for acquisition, directly or indirectly, by
the Partnership (any such asset, a “Proposed Qualified Asset”). LMLP GP or Asset
Manager shall submit the Acquisition Memorandum described in Section 3.6(b)
hereof with respect to the Proposed Qualified Asset or a Non-Parameter Asset
that LMLP GP recommends for acquisition by the Partnership to the Executive
Committee. The Executive Committee shall have seven (7) Business Days after its
receipt of the Acquisition Memorandum to approve or disapprove of the
acquisition of a Proposed Qualified Asset or Non-Parameter Asset in accordance
with Section 3.4 hereof.
               (b) Acquisition Memorandum. For each Proposed Qualified Asset and
Non-Parameter Asset, LMLP GP or Asset Manager shall deliver to the Executive
Committee an Acquisition Memorandum describing such Proposed Qualified Asset or
Non-Parameter Asset in reasonable detail, including without limitation:
          (i) whether it is a Proposed Qualified Asset or a Non-Parameter Asset;

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          (ii) the size and location thereof;
          (iii) the improvements thereon;
          (iv) the operating history, if any, financial status and financial
projections (for a minimum of five (5) years, including any anticipated
expenditures or allowances) thereof;
          (v) market data, including rental and sales comparables and
competitive submarket survey, if necessary;
          (vi) the material findings of all due diligence undertaken to date
with respect thereto, if any, including a summary of any litigation involving
the Proposed Qualified Asset or Non-Parameter Asset and the material findings to
date of any Environmental Assessment and/or Physical Inspection Report;
          (vii) photographs and site plans;
          (viii) the estimated cost to the Partnership, including the estimated
purchase price and estimated due diligence costs, the amount and material terms
of any mortgage indebtedness to be assumed, incurred or taken subject to;
          (ix) the material provisions of the net lease or leases thereon and
copies of such leases (or in the case of proposed leases, drafts or reasonably
detailed abstracts of proposed leases);
          (x) the identification of each tenant and financial information
relating to each such tenant;
          (xi) such other information and documentation any member of the
Executive Committee may reasonably request and is reasonably available,
including the purchase and sale agreement and loan documents.
               (c) Assets Which Do Not Comply With Acquisition Parameters. LMLP
GP may submit net-leased assets that do not comply in all respects with the
Acquisition Parameters (each, a “Non-Parameter Asset”) to the Executive
Committee for approval pursuant to Section 3.6(a) hereof.
               (d) Acquisition of Approved Qualified Assets. Upon receipt of the
written approval of a majority of the members of the Executive Committee as
provided in Section 3.6(a) above of the acquisition by the Partnership of a
Proposed Qualified Asset or Non-Parameter Asset (any Proposed Qualified Asset or
Non-Parameter Asset so approved, an “Approved Qualified Asset”), LMLP GP or
Asset Manager shall take all commercially reasonable efforts on behalf of the
Partnership to negotiate and execute all documents necessary to acquire the
Approved Qualified Asset pursuant to and in accordance with the terms approved
by the Partners (including formation of an SP Subsidiary, if applicable) and to
complete due diligence that the General Partner deems reasonably necessary,
including (to the extent not already completed) obtaining an Environmental
Assessment and a Physical Inspection Report.

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LMLP GP or Asset Manager shall keep the Executive Committee reasonably informed
of the progress of the Partnership’s acquisition of any Approved Qualified
Asset, including the material findings of all due diligence and of any material
matters that arise during the course thereof. Upon completion of all due
diligence undertaken as specified above with respect to an Approved Qualified
Asset and as a condition to completing the acquisition of the Approved Qualified
Asset, LMLP GP or Asset Manager shall deliver to the Executive Committee a
memorandum summarizing the material findings of the completed due diligence and
any changes in the status of such Approved Qualified Asset since the date of the
Acquisition Memorandum described in Section 3.6(b) above and the Executive
Committee, in accordance with Section 3.4 hereof, shall confirm its continuing
approval of the acquisition before LMLP GP commits (on a nonrefundable basis)
the Partnership’s funds as provided below. Upon request by any member of the
Executive Committee, LMLP GP or Asset Manager will provide to the Executive
Committee copies of the Environmental Assessment, the Physical Inspection Report
and the survey after completion thereof.
                    It is understood and agreed that (x) LMLP GP may deposit its
own funds, or cause the Partnership to deposit Partnership funds, as refundable
earnest money, and (y) the Partnership’s funds shall be substituted (and such
funds reimbursed to LMLP GP) or committed, as the case may be, on a
nonrefundable basis only after due diligence is completed and the Executive
Committee has confirmed its continuing approval of the acquisition. After the
Partnership has committed its funds on a nonrefundable basis in accordance with
the prior sentence, if the terms of the acquisition change in any material
respect from the terms described in the Acquisition Memorandum, such change
shall require the consent of a majority of the members of the Executive
Committee.
                    An acquisition of a Approved Qualified Asset shall be made
through SP Subsidiaries utilizing the SP Subsidiary Agreements.
                    Within five (5) Business Days after the closing of the
acquisition of an Approved Qualified Asset, LMLP GP shall deliver to the
Partners a closing statement acknowledging the receipt of and setting forth the
application of the Partners’ Capital Contributions and any other funds of the
Partnership used to acquire such Approved Qualified Asset or to pay closing
costs (including an estimate of costs not finalized at closing, including legal
fees and costs) associated therewith.
               (e) Disapproved Qualified Assets. If the Executive Committee
(x) disapproves any Proposed Qualified Asset or any proposed Non-Parameter
Asset, (y) fails after the completion of due diligence to confirm its continuing
approval of the acquisition of an Approved Qualified Asset as provided in
Section 3.6(d) above, or (z) otherwise withdraws its approval of an Approved
Qualified Asset as provided in Section 3.6(d) above, LMLP GP shall not cause or
permit the Partnership to acquire such Proposed Qualified Asset, proposed Non-
Parameter Asset or Approved Qualified Asset and the LMLP Partners or their
designee shall have the right to acquire such Proposed Qualified Asset, proposed
Non-Parameter Asset or Approved Qualified Asset for their own account or with or
in connection with any other Person; provided that such right shall not apply if
the members of the Executive Committee appointed by Inland vote to approve the
acquisition in accordance with Section 3.4 hereof.

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               (f) Acquisition Costs. Except as provided in this Section 3.6(f)
and in Section 3.6(g) hereof, LMLP GP or the Asset Manager (as the case may be)
shall be liable for all costs and expenses (“Acquisition Costs”) arising in
connection with the identification or evaluation of, the bidding on and the
structuring and negotiation of and contracting for the acquisition or attempted
acquisition of, and the due diligence undertaken in connection with, any
Proposed Qualified Asset or Approved Qualified Asset (such activities, the
“Acquisition Activities”); provided that:
          (i) the Partnership shall (x) reimburse LMLP GP or the Asset Manager
(as the case may be) for all Acquisition Costs and (y) be liable for all
reasonable and customary costs and expenses of Third Parties retained in
connection with the Acquisition Activities related to Approved Qualified Assets;
          (ii) the Partnership shall reimburse LMLP GP or the Asset Manager (as
the case may be) for 60% of the Acquisition Costs in connection with Acquisition
Activities related to Proposed Qualified Assets and Approved Qualified Assets
that are disapproved by the Executive Committee;
               Notwithstanding the foregoing, but subject to Section 3.9 hereof,
if for any reason other than pursuant to Article XI hereof any LMLP Affiliated
Party (instead of the Partnership or an SP Subsidiary) acquires title to any
Proposed Qualified Asset or Approved Qualified Asset, LMLP shall pay all of the
costs and expenses (and reimburse the Partnership for any refundable or
nonrefundable deposits funded by the Partnership in connection with the
acquisition of such asset) incurred or to be incurred in connection with the
Acquisition Activities relating to such Proposed Qualified Asset or Approved
Qualified Asset.
               (g) Acquisition Fee. Upon the acquisition of any Approved
Qualified Asset by the Partnership or by an SP Subsidiary (including any
Approved Qualified Asset contributed in whole or in part by LMLP to the
Partnership), pursuant to this Section 3.6, Inland shall pay LMLP GP or the
Asset Manager an acquisition fee (the “Acquisition Fee”) equal to the sum of the
gross purchase price of such acquired Approved Qualified Asset multiplied by
0.425%.
               For example, if the purchase price of such acquired Approved
Qualified Asset were $25 million, Inland’s Acquisition Fee would equal $106,250.
               Section 3.7 Sale of Qualified Assets.
               (a) Authority to Sell. Subject to Article XI, the General Partner
shall have no authority to and shall not initiate the sale of any Qualified
Asset without approval by the Executive Committee in accordance with Section 3.4
of this Agreement.
               (b) Assets in Foreclosure. In the event a lender to the
Partnership or a SP Subsidiary has initiated or threatens to initiate a
foreclosure proceeding with respect to any Qualified Asset securing such
lender’s loan to the Partnership or such SP Subsidiary, and a Partner disagrees
as to whether such Qualified Asset shall be transferred to the lender in
satisfaction of such loan, the Partner not in favor of such transfer shall have
the right to purchase such Qualified Asset from the Partnership for One Dollar
($1.00) provided such Partner

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assumes such loan in full and such lender releases the Partnership and any
guarantors therefrom. No adjustments to the Capital Contributions, Capital
Commitments, or Capital Account shall be made on account of a transfer made in
accordance with this Section 3.7(b).
               Section 3.8 Partnership Indebtedness.
               (a) Maximum Debt. The Partnership on a consolidated basis with
the SP Subsidiaries shall maintain a total debt (secured or unsecured) of not
greater than seventy-five percent (75%) of the gross acquisition cost of the
Partnership’s Qualified Assets; provided, that the gross acquisition cost of a
Qualified Assumed Asset shall include the refinancing costs (including
defeasance costs and prepayment costs) related to the Qualified Assumed Asset.
The total debt secured by any Qualified Asset shall not exceed 75% of the gross
acquisition cost of such Qualified Asset; provided, that the gross acquisition
cost of a Qualified Assumed Asset shall include the refinancing costs (including
defeasance costs and prepayment costs) related to the Qualified Assumed Asset.
               (b) Non-Recourse to the Partners. Notwithstanding anything to the
contrary contained in this Agreement, the Partnership shall not incur debt that
is recourse to the Partners, and the Partners shall not be liable for any debts
or other obligations or liabilities incurred by the Partnership; provided, that,
if a lender will not accept the Partnership as a guarantor for “non-recourse
carve-outs,” LMLP shall provide such “non-recourse carve-out” guarantee.
               (c) Cross-Default Provisions. Unless approved by a Supermajority
Vote of the Executive Committee, the Partnership shall not incur any
indebtedness that contains cross-default provisions, except for any financing
the Partnership shall obtain pursuant to Sections 3.8 (e) and (f) hereof.
               (d) Loan Terms. The Partnership shall endeavor to procure
indebtedness, the terms of which will:
                    (i) not prohibit the replacement of the General Partner or
the Asset Manager with a Person, including an Affiliate of Inland, so long as
such Person meets the standards of the commercial mortgage backed securities
market; and
                    (ii) not prohibit transfers pursuant to Articles VIII or XI
hereof;
                    in each case without triggering the due on sale provision, a
prepayment penalty or an assumption fee (other than administrative fees and
other nominal lender fees, including legal costs).
               (e) Restriction on Indebtedness. Notwithstanding anything in this
Agreement to the contrary, but subject to Sections 3.8(a), (b), (c) and (d), so
long as any Preferred Equity is outstanding, the Partnership shall be prohibited
from refinancing any Qualified Assumed Asset with allocated Preferred Equity
without the prior written consent of LMLP; provided that the Partnership shall,
without the approval of LMLP, be permitted to obtain a loan or loans to
refinance any such Qualified Assumed Assets if (i) the annual total debt

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service payments required to be paid on such loan or loans is equal to or less
than the payments that the Partnership is otherwise required to make on any
Existing Indebtedness and any other indebtedness related to such Qualified
Assumed Assets and the Preferred Equity being redeemed with the proceeds of such
loan or loans, (ii) a portion of the proceeds of such loan or loans will be used
to sufficiently redeem the Preferred Equity Redemption Amount related to such
Qualified Assumed Asset in accordance with Section 7.1(c) hereof, (iii) such
loan or loans are on commercially reasonable terms and (iv) LMLP is provided
with 10 Business Days advance notice of the terms of each such loan or loans.
               (f) Qualified Assumed Asset Debt Placement. Notwithstanding
anything in this Agreement to the contrary, but subject to Sections 3.8(a), (b),
(c) and (d), LMLP GP or LMLP is hereby authorized to obtain a loan or loans on
behalf of the Partnership or an SP Subsidiary to refinance any or all of the
Qualified Assumed Assets with allocated Preferred Equity, without the approval
of the Executive Committee or the consent of Inland, so long as (i) the annual
total debt service payments required to be paid on such loan or loans is equal
to or less than the payments that the Partnership is otherwise required to make
on any Existing Indebtedness and any other indebtedness related to such
Qualified Assumed Assets and the Preferred Equity being redeemed with the
proceeds of such loan or loans, (ii) a portion of the proceeds of such loan or
loans will be used to redeem the Preferred Equity Redemption Amount related to
such Qualified Assumed Asset in accordance with Section 7.1(c) hereof, (iii)
such loan or loans are on commercially reasonable terms and (iv) Inland is
provided with 10 Business Days advance notice of the terms of each such loan or
loans.
               (g) Future Debt Placement. For any future debt financings, the
Partnership shall give each of Inland Mortgage Brokerage Corporation and Concord
Debt Holdings LLC the opportunity to bid to place or originate such debt
financing, but the Partnership shall not be obligated to use either Inland
Mortgage Brokerage Corporation or Concord Debt Holdings LLC for any future debt
financing.
               Section 3.9 Business Opportunity.
               (a) LMLP.
          (i) General. Each LMLP Affiliated Party may each engage in or possess
any interest in other business ventures of any kind, independently or with
others, including but not limited to the ownership, operation and management of
net-leased real estate assets, except as provided in this Section 3.9(a).
          (ii) Exclusivity. During the Acquisition Period and except as provided
in Section 3.9(iii) hereof or with respect to obligations to the existing joint
ventures set forth on Schedule 3.9 hereto, (a) the LMLP Affiliated Parties shall
not acquire, or earn any incentive fee for the management or leasing of, any
net-leased assets which satisfy or comply with all of the “Acquisition
Parameters,” and (b) LMLP GP shall make available for purchase by the
Partnership, and the Partnership shall have the right to purchase pursuant to
Section 3.6 hereof, all net-leased assets offered to or discovered by the LMLP
Affiliated Parties which satisfy or comply with all of the “Required Parameters”
comprising the Acquisition Parameters (collectively, the “Exclusivity Right”).

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          (iii) Acquisition by LMLP Affiliated Parties. Notwithstanding anything
to the contrary contained in this Agreement, any LMLP Affiliated Party may
acquire (A) the assets LMLP GP is required to offer to the Partnership in
accordance with this Section 3.9(a) only (1) if the asset is owned by an LMLP
Affiliated Party or related (through adjacent or common ownership or constitutes
land or other assets underlying or constituting part of an asset owned by an
LMLP Affiliated Party) to an asset owned by an LMLP Affiliated Party, (2) if the
seller will accept only O.P. Units in exchange therefor, (3) if any LMLP
Affiliated Party is required to offer the asset pursuant to an existing joint
venture arrangement, or (4) after the Executive Committee (including at least
one (1) of the two (2) members appointed by Inland) has disapproved such
acquisition as provided in Section 3.4 hereof and (B) assets that it is not
required to offer to the Partnership under this Section 3.9(a).
          (iv) Termination of Exclusivity Right. Notwithstanding anything to the
contrary contained in this Agreement, the Exclusivity Right and the provisions
of this Section 3.9(a) shall terminate on the earlier of (A) the expiration of
the Acquisition Period and (B) at such time as the Executive Committee
(including at least one (1) of the two (2) members appointed by Inland)
disapproves, within any consecutive twelve (12) month period, the lesser of
(x) four (4) Proposed Qualified Assets or Approved Qualified Assets pursuant to
this Agreement and (x) the number (but in no event less than three (3)) of
Proposed Qualified Assets and Approved Qualified Assets requiring an equity
investment by the Partnership of at least $100,000,000.00 assuming 70% debt to
the proposed purchase price.
          (v) LMLP Existing Joint Ventures. From time to time, upon reasonable
written request from Inland, the LMLP Partners shall provide a schedule of the
LMLP Affiliated Parties’ existing joint ventures’ respective investment criteria
and exclusivity terms. A current list the LMLP Affiliated Parties’ existing
joint ventures’ respective investment criteria and exclusivity terms is set
forth on Schedule 3.9 hereto.
          (vi) LMLP Restrictions.
               (A) The LMLP Partners shall cause the LMLP Affiliated Parties not
to directly or indirectly solicit or otherwise attempt to persuade any tenant of
any Qualified Asset to vacate the Qualified Asset to purchase, or relocate to,
another asset that is not a Qualified Asset.
               (B) LMLP and its Affiliates shall not discriminate against any
Qualified Asset when making a proposal to any existing or prospective tenant in
connection with the leasing of available space.
               (C) In the event that an LMLP Affiliated Party leases space to a
then tenant of a Qualified Asset, LMLP GP, so long as it is the General Partner,
shall provide written notice to Inland of such leasing activity.
               (b) Inland. Inland and any of its Affiliates and related parties
may engage in or possess any interest in other business ventures of any kind,
independently or with others, including but not limited to the ownership,
operation and management of net-leased real estate asset.

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               (c) Duties and Conflicts. Subject to LMLP GP’s obligation to
present net-leased real estate assets to the Partnership pursuant to Section 3.6
and Section 3.9(a) hereof, each Partner recognizes that the other Partners and
their Affiliates have or may have other business interests, activities and
investments, some of which may be in conflict or competition with the business
of the Partnership, and that such Persons are entitled to carry on such other
business interests, activities and investments. The Partners and their
Affiliates may engage in or possess an interest in any other business or venture
of any kind, independently or with others, on their own behalf or on behalf of
other entities with which they are affiliated or associated, and such Persons
may engage in any activities, whether or not competitive with the Partnership,
without any obligation (except as expressed in Sections 3.6 and 3.9(a)) to offer
any interest in such activities to the Partnership or to any Partner. Except as
provided in Sections 3.6 or 3.9(a), neither the Partnership nor any Partner
shall have any right, by virtue of this Agreement, in such activities, or the
income or profits derived therefrom, and the pursuit of such activities, even if
competitive with the business of the Partnership, shall not be deemed wrongful
or improper.
               Section 3.10 Payments to the Asset Manager of the General
Partner.
               (a) Property Management Fee. The General Partner shall cause the
Partnership to pay to the Asset Manager (or its designee) pursuant to the
Management Agreement an annual Property Management Fee (“Property Management
Fee”) equal to the sum of (x) three percent (3%) of actual gross revenues for
the fiscal year (or applicable portion thereof) derived from Qualified Assets
encumbered by leases that provide for full recovery of the Property Management
Fee from the tenant (“Gross Revenues”), plus (y) on Qualified Assets where the
leases do not provide for full recovery of the Property Management Fee from the
tenant, the amount recoverable for the fiscal year (or applicable portion
thereof) from the tenants of such Qualified Assets for property management
expenses under such leases (“Recoverable Amounts”), payable monthly.
               (b) Partnership Management Fee. The General Partner shall cause
the Partnership to pay to the Asset Manager pursuant to the Management Agreement
an annual Partnership Management Fee (“Partnership Management Fee”) equal to
(x) so long as LMLP GP is the General Partner, Inland’s Percentage Interest
multiplied by three hundred seventy five thousandths of a percent (0.375%) of
the Equity Capital for a fiscal year (pro rated for partial years), or (y) so
long as LMLP GP is no longer the General Partner, three hundred seventy five
thousandths of a percent (0.375%) of the Equity Capital for a fiscal year (pro
rated for partial years), in either case payable monthly and adjusted as
provided herein. Within thirty (30) days of the Partnership’s receipt of the
annual reports described in Section 4.3 hereof for a fiscal year, the Asset
Manager shall provide to the Partners a written statement of reconciliation
(which the Partners shall have the right to contest) setting forth (x) the
Equity Capital for such fiscal year (or partial year) and the Partnership
Management Fee payable to the Asset Manager in connection therewith, pursuant to
this Agreement, (y) the Partnership Management Fee already paid by the
Partnership to the Asset Manager during such fiscal year (or partial year), and
(z) either the amount owed to the Asset Manager by the Partnership (which shall
be the excess, if any, of the Partnership Management Fee payable to the Asset
Manager for such fiscal year (or partial year) pursuant to this Agreement over
the Partnership Management Fee actually paid by

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the Partnership to the Asset Manager for such fiscal year (or partial year)) or
the amount owed to the Partnership by the Asset Manager (which shall be the
excess, if any, of the Partnership Management Fee actually paid by the
Partnership to the Asset Manager for such fiscal year (or partial year) over the
Partnership Management Fee payable to the Asset Manager for such fiscal year
pursuant to this Agreement). The Asset Manager or the Partnership, as the case
may be, shall pay to the other the amount owed pursuant to clause (z) above
within five (5) Business Days of the receipt by the Partners of the written
statement of reconciliation described in this Section 3.10(b).
               In addition, a credit in an amount equal to three hundred seventy
five thousandths of a percent (0.375%) of the Equity Capital for a fiscal year
(pro rated for partial years), less the Partnership Management Fee, as adjusted
above (or the applicable portion thereof), shall accrue and be reserved on the
Partnership books until a Capital Call is made by the General Partner in
accordance with Section 5.1(b) hereof, whereupon the amount of the credit shall
be applied, in whole or in part, to the extent necessary to fund LMLP’s pro rata
shares of such Capital Call and will be treated for purposes of this Agreement
as if each pro rata share of such amount were an actual Capital Contribution
made by the respective LMLP Partner which (1) reduces the respective aggregate
Capital Commitment of each LMLP Partner and (2) gives rise to an entitlement to
allocations (but only out of subsequent Profits), and related distributions, in
amounts that reflect the amounts that would have been allocated and distributed
if such notional capital contributions had constituted actual Capital
Contributions, including a return of such notional capital contributions to LMLP
pursuant to Section 7.1 hereof.
               (c) Acquisition Fees. Inland shall pay the Acquisition Fees in
accordance with the provisions of Section 3.6(g).
               Section 3.11 Exculpation.
               (a) LMLP. No LMLP Affiliated Party nor or any officer, director,
trustee, shareholder, member, manager, partner, employee, Affiliate or agent of
any LMLP Affiliated Party shall be liable, responsible or accountable in damages
or otherwise to the Partnership or any other Partner for any act or omission on
behalf of the Partnership, in good faith and within the scope of the authority
conferred on LMLP GP as General Partner under this Agreement or otherwise under
this Agreement or the Asset Manager, as the case may be, or by law unless such
act or failure to act (i) is or results in a breach of any representation,
warranty or covenant of any LMLP Partner contained in this Agreement or any
other agreement entered into in connection therewith or related thereto,
(ii) was fraudulent or committed in bad faith or (iii) constituted gross
negligence, willful misconduct or a breach of fiduciary duty.
               (b) Inland. None of Inland, or any officer, director, trustee,
shareholder, member, manager, partner, employee, Affiliate or agent of Inland,
or any Affiliate of Inland shall be liable, responsible or accountable in
damages or otherwise to the Partnership or to any other Partner for any act or
omission on behalf of the Partnership, in good faith and within the scope of
authority conferred on Inland under this Agreement or by law unless such act or
failure to act (i) is or results in a breach of any representation, warranty or
covenant of Inland contained in this Agreement or any other agreement entered
into in connection therewith or

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related thereto, (ii) was fraudulent or committed in bad faith or
(iii) constituted gross negligence, willful misconduct or a breach of fiduciary
duty.
               (c) Survival. The provisions of this Section 3.12 shall survive
any termination of the Partnership or this Agreement.
               Section 3.12 Indemnification.
               (a) By the Partnership. The Partnership shall indemnify, defend
and hold harmless any Person (an “Indemnified Party”) who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of any act or omission or alleged act or omission arising out of such
Indemnified Party’s activities as (i) a Partner or an officer, director,
trustee, shareholder, member, manager, partner, employee, Affiliate or agent of
the Partner, (ii) the General Partner or the Asset Manager or an officer,
director, trustee, shareholder, member, manager, partner, employee, Affiliate or
agent of any of them on behalf of the Partnership or in furtherance of the
interest of the Partnership, or (iii) LMLP or any LMLP Affiliated Party, but
only if LMLP GP is no longer the General Partner, that is obligated to enter
into a direct financial obligation (including, without limitation, a
“non-recourse carve-out” guarantee) in connection with the financing of any
Qualified Asset, in each case against personal liability, claims, losses,
damages and expenses for which such Indemnified Party has not been reimbursed by
insurance proceeds or otherwise (including reasonable attorneys’ fees,
judgments, fines and amounts paid in settlement) actually and reasonably
incurred by such Indemnified Party in connection with such action, suit or
proceeding and any appeal therefrom, unless such Indemnified Party (A) acted
fraudulently, in bad faith or with gross negligence or willful misconduct or
(B) by such act or failure to act breached any representation, warranty or
covenant contained in this Agreement, which breach had or has a material adverse
effect on the Partnership or any Partner and, if capable of cure, is not cured
within fifteen (15) days after notice thereof by the aggrieved Partner(s). Any
indemnity by the Partnership under this Agreement shall be provided out of, and
to the extent of, Partnership revenues and assets only, and no Partner shall
have any personal liability on account thereof. The indemnification provided
under this Section 3.12 shall (x) be in addition to, and shall not limit or
diminish, the coverage of the Partners or any Affiliates under any insurance
maintained by the Partnership and (y) apply to any legal action, suit or
proceeding commenced by a Partner or in the right of a Partner or the
Partnership. The indemnification provided under this Section 3.12 shall be a
contract right and shall include the right to be reimbursed for reasonable
expenses incurred by any such Indemnified Party within thirty (30) days after
such expenses are incurred.
               (b) By the LMLP Partners. The LMLP Partners, so long as LMLP GP
is the General Partner, shall indemnify and hold harmless Inland and any
Affiliate and related party or agent thereof from and against any liabilities,
claims, losses, damages and expenses incurred by any such person (including
reasonable attorneys’ fees, judgments, fines and amounts paid in settlement) as
a result of any act or omission by any LMLP Affiliated Party which
(i) constitutes or results in a breach of any representation, warranty or
covenant of any LMLP Partner contained in this Agreement or any other agreement
entered into in connection herewith or related hereto, (ii) was performed or
omitted fraudulently or in bad faith or (iii) constituted gross negligence,
willful misconduct or breach of fiduciary duty.

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               (c) By Inland. Inland, so long as LMLP GP is no longer the
General Partner, shall indemnify and hold harmless the LMLP Affiliated Parties
or agent thereof from and against any liabilities, claims, losses, damages and
expenses incurred by any such person (including reasonable attorneys’ fees,
judgments, fines and amounts paid in settlement) as a result of any act or
omission by Inland or any successor General Partner which (i) constitutes or
results in a breach of any representation, warranty or covenant of Inland or any
successor General Partner contained in this Agreement or any other agreement
entered into in connection herewith or related hereto, (ii) was performed or
omitted fraudulently or in bad faith or (iii) constituted gross negligence,
willful misconduct or breach of fiduciary duty.
ARTICLE IV
BOOKS AND RECORDS; REPORTS TO PARTNERS
               Section 4.1 Books. The General Partner shall maintain or cause to
be maintained separate, full and accurate books and records of the Partnership,
and any Partner or any authorized representative of any Partner, shall have the
right to inspect, examine and copy the same and to meet with employees of the
General Partner responsible for preparing the same at reasonable times during
business hours and upon reasonable notice. All policies of the Partnership with
respect to the maintenance of such books and records shall be subject to
approval by all of the Partners.
               Section 4.2 Monthly and Quarterly Reports.
               (a) Monthly Reports. The General Partner shall prepare and
distribute to Inland within twenty (20) days after the last day of each month a
report with respect to the Partnership, which shall include (i) unaudited
financial statements, consisting of at least an operating statement for the
monthly period and year-to-date showing variances from the Annual Budget portion
of the Annual Plan and (ii) a schedule of aged accounts receivable and accounts
payable. Variances from any line item in the Annual Budget exceeding the greater
of One Hundred Thousand Dollars ($100,000) and ten percent (10%) of the amount
allocated to such budget line item through the end of such month shall be
explained in writing, unless already approved by the Executive Committee
pursuant to Section 3.4 hereof.
               (b) Quarterly Reports. The General Partner shall, no later than
the thirtieth (30th) day after the end of each fiscal quarter, prepare and
distribute:
          (i) a year-to-date consolidated report with respect to the Partnership
(with the last month of each such report comprised of forecasted, rather than
actual, results), prepared in accordance with generally accepted accounting
principles, consistently applied, including (a) a balance sheet, (b) a profit
and loss statement, (c) a statement of changes in the Partners’ Capital
Accounts, (d) a report briefly describing each variance from the applicable
budget line item in the consolidated Annual Budget portion of the Annual Plan
exceeding the greater of One Hundred Thousand Dollars ($100,000) and ten percent
(10%) of the amount allocated to such budget line item through the date of such
report, and (e) calculations in sufficient detail to verify the accuracy of all
fees and other amounts paid or payable to the Asset Manager under the Management
Agreement;

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          (ii) a report with respect to each Qualified Asset, including an
operating statement for the quarter and year-to-date showing each variance from
the budget line items in the Annual Budget portion of the Annual Plan, and a
narrative describing material changes in property operations, physical
condition, capital expenditures and leasing and occupancy; and
          (iii) so long as LMLP GP is the General Partner, such other reports,
statements and information regarding the Partnership and Qualified Assets as
Inland may reasonably request from time to time.
               Section 4.3 Annual Reports. The General Partner shall prepare and
distribute to Inland within (x) forty-five (45) days after the end of each
fiscal year draft unaudited financial statements with respect to the
Partnership, and (y) within seventy-five (75) days after the end of each fiscal
year audited financial statements with respect to the Partnership. Such
financial statements shall be prepared in accordance with generally accepted
accounting principles, consistently applied, and shall be audited at the
Partnership’s expense by such nationally recognized firm of independent
certified public accountants approved by the Executive Committee as provided in
Section 3.4 hereof. All reports delivered pursuant to this Section 4.3 shall
also include unaudited calculations in sufficient detail to verify the accuracy
of all distributions paid by the Partnership.
               Section 4.4 Accountants; Tax Returns. The General Partner shall
also engage such nationally recognized firm of independent certified public
accountants approved by the Executive Committee as provided in Section 3.4
hereof to review, or to sign as preparer, all federal, state and local tax
returns which the Partnership is required to file. The General Partner will
furnish to each Partner within one hundred twenty (120) days after the end of
each calendar year, or as soon thereafter as is practicable, a Schedule K-1 or
such other statement as is required by the Internal Revenue Service which sets
forth such Partner’s share of the profits or losses and other relevant fiscal
items of the Partnership for such fiscal year. If requested by a Partner, the
General Partner shall deliver to such Partner copies of any federal, state and
local income tax returns and information returns which the Partnership is
required to file.
               Section 4.5 Accounting and Fiscal Year. The General Partner shall
keep the Partnership books and records on the accrual basis. The fiscal year of
the Partnership shall end on December 31.
               Section 4.6 Partnership Funds.
               (a) Generally. The funds of the Partnership shall be deposited
into such account or accounts as are designated by the General Partner. All
withdrawals from or charges against such accounts shall be made by the General
Partner or by those Persons designated from time to time by the General Partner.
               (b) Restrictions on Deposits. Pending distribution or expenditure
in accordance with the terms of this Agreement, funds of the Partnership may be
invested, in the reasonable discretion of the General Partner, in United States
government

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obligations, insured obligations which are rated not lower than AA by Standard &
Poor’s or have a comparable rating from a nationally recognized rating agency,
collateralized bank time deposits, repurchase agreements, money market funds,
commercial paper which is rated not lower than P-1, certificates of deposit
which are rated not lower than AA by Standard & Poor’s or have a comparable
rating from a nationally recognized rating agency, banker’s acceptances eligible
for purchase by the Federal Reserve and bonds and other evidences of
indebtedness and preferred stock which are rated not lower than AA by Standard &
Poor’s or are of a comparable credit quality.
               Section 4.7 Insurance. The General Partner shall cause the tenant
or tenants of each Qualified Asset to maintain insurance thereon of such types
and in such amounts that are in accordance with the applicable lease. Unless
otherwise determined by Supermajority Vote of the Executive Committee, the
General Partner shall cause the Partnership to obtain, at the Partnership’s
expense, such types and amounts of insurance that the tenant or tenants of any
Qualified Asset are not required to maintain and that are included within the
insurance standards listed on Schedule 4.7 hereto, as may be revised from time
to time by a Supermajority Vote of the Executive Committee.
ARTICLE V
CONTRIBUTIONS
               Section 5.1 Capital Contributions.
               (a) Generally; Percentage Interests.
                    (i) LMLP has made an Initial Capital Contribution to the
Partnership by contributing to the Partnership cash in an amount set forth on
Schedule 1 hereto and Contributed Assets pursuant to the Contribution Agreement
having a value set forth on Schedule 1 to the Contribution Agreement. Inland has
made an Initial Capital Contribution to the Partnership by contributing to the
Partnership cash in the amount set forth on Schedule 1 hereto (which reflects a
$250,000 credit as satisfaction of its underwriting fees in connection with the
formation of the Partnership).
                    (ii) The aggregate of Inland’s Initial Capital Contribution
and Remaining Qualified Assumed Asset Capital Contribution shall not exceed
$214,259,817, less the designated amounts with respect to each Cap/Ex Lease
Assumed Asset (which shall not exceed $3,000,000) (the “Cap Ex/Lease Assumed
Asset Amount”), but only to the extent one or more of the Cap Ex/Lease Assumed
Assets are acquired         .
                    (iii) Except as provided in this Section 5.1, (i) no Partner
shall be obligated to make any Additional Capital Contribution or Extraordinary
Funding to the Partnership and (ii) any Additional Capital Contribution or
Extraordinary Funding shall be made by the Partners in proportion to their
respective Percentage Interests as determined at the time of the Capital Call or
Extraordinary Call.
                    (iv) The Partners shall have the Percentage Interests in the
Partnership set forth opposite each Partner’s name on Schedule 1 hereto.

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                    (v) The aggregate Purchase Price for all of the Qualified
Assumed Assets shall be $747,474,914, subject to adjustment in accordance with
the Contribution Agreement, the Purchase Agreement and the Letter Agreement.
Subject to the Contribution Agreement, the Purchase Agreement and the Letter
Agreement, the Qualified Assumed Assets shall be acquired by the Partnership,
from time to time, on or prior to March 31, 2008; provided, that the Delayed
Qualified Assumed Assets shall be acquired by the Partnership, from time to
time, on or prior to June 30, 2008. Simultaneously with the acquisition of a
Qualified Assumed Asset, (i) Inland shall make an attendant Remaining Qualified
Assumed Assets Capital Contribution in cash in an amount equal to the product of
0.85 multiplied by the difference between (x) the Purchase Price (as adjusted
pursuant to the Contribution Agreement or the Purchase Agreement and the Letter
Agreement) of such Qualified Assumed Asset and (y) the principal balance of any
mortgage financing secured by such Qualified Assumed Asset and the amount of
Preferred Equity determined in accordance with the Letter Agreement; and
(i) LMLP shall make an attendant Remaining Qualified Assumed Assets Capital
Contribution in cash or in Contributed Assets in an amount or having a value
equal to the product of 0.15 multiplied by the difference between the Purchase
Price (as adjusted pursuant to the Contribution Agreement or the Purchase
Agreement and the Letter Agreement) of such Qualified Assumed Asset less the
principal balance of any mortgage financing secured by such Qualified Assumed
Asset and the amount of Preferred Equity determined in accordance with the
Letter Agreement.
                    (vi) In the event that by June 30, 2008 not all of the
Qualified Assumed Assets have been acquired by the Partnership and LMLP has made
a Capital Contribution in excess of 15% of the aggregate Capital Contributions
of the Partners, then the General Partner shall cause the amount of LMLP’s
Capital Contribution that is in excess of 15% of the aggregate Capital
Contributions of the Partners to accrue and be reserved on the Partnership’s
books as a credit toward satisfying LMLP’s share of any future Capital Call and
such credit shall be treated as if it were an actual Capital Contribution for
purposes of determining corresponding allocations and distributions.
               (b) Additional Capital Contributions. In the event the
Partnership requires capital to acquire an Approved Qualified Asset during the
Acquisition Period, the General Partner shall be entitled to require, by written
notice to the Partners, an additional Capital Contribution (an “Additional
Capital Contribution”) from the Partners in an amount not in excess of the
amount necessary to acquire such Approved Qualified Asset plus all reasonable
and customary costs and expenses incurred by the Partnership in connection
therewith; provided that (x) each Partner shall be required to contribute the
amount determined by multiplying such Partner’s Percentage Interest by the
amount of such Additional Capital Contribution and (y) no Partner shall be
required to contribute the amount described in clause (x) above if such amount,
when added to the total of all of such Partner’s prior Capital Contributions,
exceeds such Partner’s Capital Commitment. If the General Partner shall provide
to the Partners a written notice calling for an Additional Capital Contribution
(any such notice, a “Capital Call”) setting forth the total amount of such
Additional Capital Contribution, the amount of each Partner’s share of such
Additional Capital Contribution as determined pursuant to clause (x) above and
the due date on which the General Partner is requiring that such Additional
Capital Contribution be contributed to the Partnership, which due date shall be
at least ten (10) Business Days after the date on which the Partners actually
received the Capital Call and not more than one (1) Business Day prior to the
scheduled closing of the acquisition of

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such Approved Qualified Asset; each Partner shall contribute its share of such
Additional Capital Contribution in immediately available funds on or before such
due date. If the acquisition of an Approved Qualified Asset fails to close and
the General Partner determines there will not be a closing within fifteen
(15) days of the date of the originally scheduled closing, the General Partner
(x) shall inform the Partners of such failure and return each Partner’s share of
the Additional Capital Contribution made with respect thereto and (y) each
Partner’s Capital Contribution shall be restored to the level thereof
immediately prior to such Additional Capital Contribution. If, at any time after
the Partners have each contributed their entire Capital Commitment, the Partners
elect to contribute additional capital, the Partners shall contribute such
additional capital in accordance with their respective Percentage Interests.
               (c) Extraordinary Fundings. In the event the Partnership requires
additional funds to cover any costs and expenses for which the Partnership has
insufficient funds, including tenant improvements and capital expenditures, the
General Partner may make a written request therefor (any such request, an
“Extraordinary Call”) setting forth the amount requested and the due date
therefor, which due date shall be at least ten (10) Business Days after the date
on which the Partners actually received the Extraordinary Call; provided that
(i) any amount requested shall not exceed 5% of the Purchase Price of the
Qualified Asset if such funds are to be used for a specific Qualified Asset or
(ii) the aggregate of all amounts requested shall not exceed $20,000,000 if such
funds are to be used for the Partnership generally (such amount, the
“Extraordinary Call Cap”); provided further that no Partner shall be required to
contribute any capital to the Partnership in excess of such Partner’s Capital
Commitment. Each Partner shall be required to fund an amount equal to the amount
determined by multiplying such Partner’s Percentage Interest by the amount set
forth in such approved Extraordinary Call (each such Extraordinary Call required
to be funded hereunder, an “Extraordinary Funding”). Each Extraordinary Funding
shall be made as a supplementary capital contribution by the Partners to the
Partnership (any such contribution, an “Extraordinary Capital Contribution”).
Each Partner shall contribute its share of such Extraordinary Capital
Contribution in immediately available funds on or before the due date in the
Extraordinary Call.
               (d) Failure to Fund an Additional Capital Contribution or
Extraordinary Funding. If any Partner (a “Defaulting Partner”) fails to make any
Additional Capital Contribution or Extraordinary Funding which it is required to
make under this Section 5.1 by the due date therefor, then any non-defaulting
Partner shall not be permitted to make such Additional Capital Contribution or
Extraordinary Funding, but may, at its election, make a loan to the Partnership
(a “Priority Loan”) in an amount equal to the amount that Additional Capital
Contribution or Extraordinary Funding required. Upon election to make a Priority
Loan, (i) the non-defaulting Partner shall loan to the Partnership the amount of
the Defaulting Partner’s share of the Additional Capital Contribution or
Extraordinary Funding, as the case may be, as determined in accordance with
Section 5.1(b) or Section 5.1(c), as the case may be, (ii) such Priority Loan
shall bear interest at a rate of 18% per annum cumulative compounded from the
date such Priority Loan is made, (iii) the Annual Budget portion of the Annual
Plan shall be amended to reflect such Priority Loan, and (iv) such Priority Loan
(including interest accrued thereon) shall be repaid from Net Cash Flow from
Operations or Net Cash from Sales or Refinancing prior to any distribution.

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               Section 5.2 Preferred Equity Capital Contribution. Upon the
acquisition of a Qualified Assumed Asset and subject to Section 3.8(a), LMLP
shall make a Preferred Equity Capital Contribution in an amount determined in
accordance with this Agreement and the Letter Agreement; provided that the
aggregate Preferred Equity Capital Contribution shall not exceed $163,500,000.
The Preferred Equity shall be redeemed by the Partnership (i) in accordance with
Section 7.1(c) and Section 11.3(g) hereof and (ii) at the election of either the
Partnership or LMLP, if any Preferred Equity remains outstanding on the tenth
anniversary of the date first set forth above, on the tenth anniversary of the
date first set forth above in full together with all accrued and unpaid
Preferred Equity Return. The General Partner shall update Schedule 1 hereto to
reflect the Preferred Equity Capital Contribution and any redemption of
Preferred Equity pursuant to this Section 5.2 or Section 7.1 hereof.
               Section 5.3 Return of Capital Contribution. Except as otherwise
expressly provided in this Agreement, (a) the Capital Contribution of a Partner
will be returned to that Partner only in the manner and to the extent provided
in Article VII and Article IX hereof and (b) no Partner shall have any right to
demand or receive the return of its Capital Contribution. In the event the
Partnership is required or compelled to return any Capital Contribution, no
Partner shall have the right to receive assets other than cash. No Partner shall
be entitled to interest on its Capital Contribution or Capital Account
notwithstanding any disproportion therein as between the Partners.
               Section 5.4 Liability of the Limited Partners. No Limited Partner
shall have any personal liability to the Partnership, to any Partner, to the
creditors of the Partnership or to any other Person for any debt, liability or
obligation of the Partnership. No Limited Partner shall be required to
contribute funds or capital to the Partnership in excess of its Capital
Commitment although Limited Partners may at their option contribute funds in
excess of their respective Capital Commitments pursuant to Section 5.1(c) and
Section 5.1(d) hereof.
               Section 5.5 No Third Party Beneficiaries. The foregoing
provisions of this Article V are not intended to be for the benefit of any
creditor of the Partnership or any other Person, and no creditor of the
Partnership or any other Person may rely on the commitment of any Partner to
make any Capital Contribution. Additional Capital Contributions and
Extraordinary Fundings are not payable unless and until the conditions set forth
in Section 5.1 hereof have been satisfied, and no creditor of the Partnership or
any other Person shall have, or be given, any right to cause a Capital Call or
Extraordinary Call to be given by the General Partner.
ARTICLE VI
MAINTENANCE OF CAPITAL ACCOUNTS;
ALLOCATION OF PROFITS AND LOSSES
FOR BOOK AND TAX PURPOSES
               Section 6.1 Capital Accounts.
               (a) Generally: Credits to Capital Accounts. A Capital Account
shall be established and maintained for each Partner. Initially, the Capital
Account of each Partner shall be credited with each Partner’s respective Initial
Capital Contribution.

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Thereafter, each Partner’s Capital Account shall be credited with any Remaining
Qualified Assumed Assets Capital Contributions, Preferred Equity Capital
Contributions, Additional Capital Contributions or Extraordinary Capital
Contributions made or contributed by such Partner and such Partner’s allocable
share of Profits, any individual items of income and gain allocated to such
Partner pursuant to the provisions of this Article VI, and the amount of
additional cash, or the Fair Market Value of any Partnership asset (net of any
liabilities assumed by the Partnership and liabilities to which the asset is
subject), contributed to the Partnership by such Partner or deemed contributed
to the Partnership by such Partner in accordance with Regulations
Section 1.704-1(b)(2)(iv)(c).
               (b) Debits to Capital Account. The Capital Account of each
Partner shall be debited with the Partner’s allocable share of Losses, any
individual items of expenses and loss allocated to such Partner pursuant to the
provisions of this Article VI, the amount of any cash distributed to such
Partner and the Fair Market Value of any Partnership asset (net of any
liabilities assumed by the Partner and liabilities to which the asset is
subject) distributed to such Partner or deemed distributed to such Partner in
accordance with Regulations Section 1.704-1(b)(2)(iv)(c).
               (c) Capital Account of Transferee. In the event that any
Percentage Interest of a Partner is transferred in accordance with the terms of
this Agreement, the transferee shall succeed to the Capital Account of the
transferor to the extent it relates to the transferred Percentage Interest in
such Partner.
               (d) Adjustments of Book Value. In the event that the Book Value
of any Partnership asset is adjusted as described in the definition of “Book
Value”, the Capital Accounts of all Partners shall be adjusted in accordance
with Regulation Section 1.704-1(b)(2)(iv)(f) or Regulation
Section 1.704-1(b)(2)(iv)(m), as applicable, to reflect such adjustment.
               (e) Compliance with Regulations. The foregoing provisions and the
other provisions of this Agreement relating to the maintenance of Capital
Accounts are intended to comply with Regulation Section 1.704-1(b) and shall be
interpreted and applied in a manner consistent with such Regulation. In the
event that the General Partner shall determine that it is prudent to modify the
manner in which the Capital Accounts, or any debits or credits thereto, are
computed in order to comply with such Regulation, the General Partner may make
such modification; provided, however, that if such modification constitutes a
Material Modification, it shall become effective only upon the consent of any
Partner to whom such modification would constitute a Material Modification.
               Section 6.2 Profits and Losses.
               (a) Allocation. For each Partnership taxable year or portion
thereof, Profit and Loss shall be allocated (after all allocations pursuant to
Section 6.3 hereof have been made) in such a manner so as to cause the Partially
Adjusted Capital Accounts of the Partners to equal, as nearly as possible, their
respective Target Accounts.

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               (b) Adjustments to “Profits” and “Losses”. When used in this
Agreement, “Profits” and “Losses” shall mean, for each fiscal year or other
period, an amount equal to the Partnership’s taxable income or loss for such
year or period, determined in accordance with Code Section 703(a) (for this
purpose, all items of income, gain, loss or deduction required to be stated
separately pursuant to Code Section 703(a)(1) shall be included in taxable
income or loss), and otherwise in accordance with the methods of accounting
followed by the Partnership for federal income tax purposes, with the following
adjustments:
          (i) any income of the Partnership that is exempt from federal income
tax and not otherwise taken into account in computing Profits or Losses shall be
added to such taxable income or loss;
          (ii) any items that are specially allocated pursuant to this Agreement
shall not be taken into account in computing Profits or Losses;
          (iii) any expenditure of the Partnership described in
Section 705(a)(2)(B) of the Code (or treated as such under
Regulation Section 1.704-1(b)(2)(iv)(i)) and not otherwise taken into account in
computing Profits or Losses pursuant to this Definition shall be deducted from
such taxable income or loss;
          (iv) any depreciation, amortization and/or cost recovery deductions
with respect to any asset shall be deemed to be equal to the Book Depreciation
available with respect to such asset;
          (v) the computation of all items of income, gain, loss and deduction
shall be made without regard to any basis adjustment under Section 743 of the
Code;
          (vi) in the event the Book Value of any Partnership asset is adjusted
pursuant to the definition of Book Value, the amount of such adjustment shall be
taken into account as gain or loss from the disposition of such asset for
purposes of computing Profits or Losses; and
          (vii) gain or loss resulting from any disposition of assets with
respect to which gain or loss is recognized for federal income tax purposes
shall be computed by reference to the Book Value of the asset disposed of,
notwithstanding that the adjusted tax basis of such asset differs from its Book
Value.
               Section 6.3 Regulatory Allocations.
               (a) Minimum Gain Chargeback. If there is a net decrease in
Partnership Minimum Gain during any fiscal year, each Partner shall be specially
allocated items of Partnership income and gain for such fiscal year (and, if
necessary, subsequent fiscal years) in an amount equal to such Partner’s share
of the net decrease in Partnership Minimum Gain, as determined under Regulations
Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made
in proportion to the respective amounts required to be allocated to each Partner
pursuant thereto. The items to be so allocated shall be determined in accordance
with Regulations Sections 1.704-2(f)(6) and 1.704-2(j)(2). This Section 6.3(a)
is intended to comply

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with the “minimum gain chargeback” requirements of Regulations
Section 1.704-2(f) and shall be interpreted consistently therewith.
               (b) Chargeback Attributable to Partner Nonrecourse Debt. If there
is a net decrease in Partner Nonrecourse Debt Minimum Gain during any fiscal
year attributable to a Partner Nonrecourse Debt, each Partner with a share of
Partner Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse
Debt at the beginning of such year shall be specially allocated items of income
and gain for such fiscal year (and, if necessary, for subsequent fiscal years)
in an amount equal to such Partner’s share of the net decrease in Partner
Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse Debt,
determined in accordance with Regulations Section 1.704-2(i)(4) and (5).
Allocations pursuant to the previous sentence shall be made in proportion to the
respective amounts required to be allocated to each Partner pursuant thereto.
The items to be so allocated shall be determined in accordance with Regulations
Sections 1.704-2(i)(4) and 1.704-2(j)(2). This Section 6.3(b) is intended to
comply with the “minimum gain chargeback” requirements of Regulations
Section 1.704-2(i)(4) and shall be interpreted consistently therewith.
               (c) Qualified Income Offset. If any Partner unexpectedly receives
any adjustment, allocation or distribution described in Regulations
Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6) which results in or increases an
Adjusted Capital Account Deficit for the Partner, such Partner shall be
allocated items of income and book gain in an amount and manner sufficient to
eliminate such Adjusted Capital Account Deficit or increase therein as quickly
as possible; provided, that an allocation pursuant to this Section 6.3(c) shall
be made if and only to the extent that such Partner would have an Adjusted
Capital Account Deficit after all other allocations provided in this Article VI
have been tentatively made as if this Section 6.3(c) were not in the Agreement.
This Section 6.3(c) is intended to constitute a “qualified income offset” as
provided by Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted
consistently therewith.
               (d) Partner Nonrecourse Deductions. Items of Partnership loss,
deduction or Section 705(a)(2)(B) expenditures that are attributable to a
Partner Nonrecourse Debt (“Partner Nonrecourse Deductions”) shall be allocated
among the Partners who bear the Economic Risk of Loss for such Partner
Nonrecourse Debt in the ratio in which they share Economic Risk of Loss for such
Partner Nonrecourse Debt. This provision is to be interpreted in a manner
consistent with the requirements of Regulations Section 1.704-2(b)(4) and
(i)(1).
               (e) Limitation on Allocation of Net Loss. To the extent any
allocation of Losses or other items of loss or deduction would cause or increase
an Adjusted Capital Account Deficit as to any Partner, such allocation shall be
reallocated among the other Partners in accordance with their respective
Percentage Interests, subject to the limitations hereof.
               (f) Curative Allocation. The allocations set forth in this
Section 6.3 (the “Regulatory Allocations”) are intended to comply with certain
requirements of the applicable Regulations promulgated under Code
Section 704(b). Notwithstanding any other provision of this Article VI, the
Regulatory Allocations shall be taken into account in allocating other operating
Profits, Losses and other items of income, gain, loss and deduction to the

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Partners for Capital Account purposes so that, to the extent possible, the net
amount of such allocations of Profits, Losses and other items shall be equal to
the amount that would have been allocated to each Partner if the Regulatory
Allocations had not occurred.
               Section 6.4 Allocation of Tax Items for Tax Purposes.
               (a) Generally. Subject to Sections 1.704-1(b)(4)(i) and
1.704-1(b)(2)(iv)(m) of the Regulations and except as otherwise provided in this
Article VI, allocations of income, gain, loss, deduction and credit for federal,
state and local tax purposes shall be allocated to the Partners in the same
manner and amounts as the book items corresponding to such tax items are
allocated for Capital Account purposes.
               (b) Recapture Income. Notwithstanding Section 6.4(a) hereof, if
there is a gain on any sale, exchange or other disposition of Partnership assets
and all or a portion of such gain is characterized as ordinary income by virtue
of the recapture rules of Code Section 1245 or 1250, or under the corresponding
recapture rules of state or local income tax law, as the case may be, then, to
the extent possible, such recapture income for United States and state and local
tax purposes shall be allocated to the Partners in the ratio that they were
allocated Tax Depreciation previously taken and allowed with respect to the
Partnership assets being sold or otherwise disposed of.
               (c) Section 754 Adjustments. Notwithstanding Section 6.4(a)
hereof, any increase or decrease in the amount of any items of income, gain,
loss, deduction or credit for tax purposes attributable to an adjustment to the
basis of Partnership assets made pursuant to a valid election or deemed election
under Sections 732(d), 734, 743, and 754 of the Code, and any increase or
decrease in the amount of any item of credit or tax preference attributable to
any such adjustment, shall be allocated to those Partners entitled thereto under
such law. Such items shall be excluded in determining the Capital Accounts of
the Partners, except as otherwise provided by Section 1.704-1(b)(2)(iv)(m) of
the Regulations.
               (d) Nonrecourse Deductions. Any “Nonrecourse Deductions” as
defined in Treasury Regulations Section 1.704-2(c) for any fiscal year or other
period shall be specially allocated as items of loss in the manner provided in
Treasury Regulations Section 1.704-2(j)(1)(ii). Depreciation deductions shall be
treated as Nonrecourse Deductions with respect to a property only to the extent
that such deductions reduce the property’s tax basis below the amount of the
Nonrecourse Liability encumbering the property.
               (e) Sharing of Excess Nonrecourse Liabilities. For purposes of
Section 1.752-3(a)(3) of the Regulations, the excess Nonrecourse Liabilities of
the Partnership shall be allocated one hundred (100%) percent to LMLP. In the
event it is determined that Inland would be allocated less than its
proportionate share of depreciation in any year as a result of the allocation of
liabilities to LMLP, the Partners agree to reallocate the liabilities in
accordance with Percentage Interests.
               (f) Section 704(c). Notwithstanding Section 6.4 hereof, if the
Partnership owns or acquires Section 704(c) Property, or if the Tax Matters
Partner makes an election referred to in the definition of “Book Value” herein,
then, solely for tax purposes and

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not for Capital Account purposes, Tax Depreciation, and any gain or loss,
attributable to such Section 704(c) Property shall be allocated between or among
the Partners in a manner that takes into account the variation between such Book
Value and such adjusted tax basis, using the traditional method of allocation,
in accordance with the principles of Code Section 704(c) and the Regulations
promulgated thereunder and such method set forth in Regulations
Section 1.704-3(b).
               Section 6.5 Tax Matters Partner. The General Partner is hereby
designated as the “tax matters partner” for the Partnership as such term is
defined in Section 6231(a)(7) of the Code (the “Tax Matters Partner”), and all
federal, state and local tax audits and litigation shall be conducted under the
direction of the General Partner. All expenses incurred with respect to any tax
matter which does or may affect the Partnership, including but not limited to
expenses incurred in connection with Partnership level administrative or
judicial tax proceedings, shall be paid out of Partnership assets, whether or
not included in an Annual Plan. The Tax Matters Partner shall, promptly upon
receipt thereof, forward to each Partner a copy of any correspondence relating
to the Partnership received from the Internal Revenue Service or any other tax
authority which relates to matters that are of material importance to the
Partnership and/or the Partners. The Tax Matters Partner shall promptly advise
each Partner in writing of the substance of any material conversation held with
any representative of the Internal Revenue Service which relates to an audit or
administrative proceeding relating to a tax return of the Partnership.
               Section 6.6 Adjustments.
               (a) Generally. Except as otherwise provided in this Agreement,
all items of Partnership income, gain, loss and deduction and any other
allocations not otherwise provided for shall be divided among the Partners in
the same proportions as they share Profits and Losses, as the case may be, for
the year.
               (b) Upon Transfer or Change in Percentage Interest. If any
Percentage Interest is transferred in any fiscal year in accordance with this
Agreement, or if a Partner’s Percentage Interest changes during any fiscal year,
all Profits and Losses attributable to such Percentage Interest for such fiscal
year shall be divided and allocated in accordance with an interim closing of the
books as of the date of a transfer or change.
               (c) Amendments to this Article VI. The General Partner is
specifically authorized by each Partner, upon the advice of the accountants or
legal counsel for the Partnership, to amend this Article VI to comply with any
Regulations with respect to the distributions and allocations of the Partnership
and any such amendment shall become effective; provided, however, that if such
amendment constitutes a Material Modification for any Partner, then such
amendment shall become effective only upon the express written consent of such
Partner.
ARTICLE VII
DISTRIBUTIONS
               Section 7.1 Cash Available for Distributions.

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               (a) Generally. Notwithstanding anything herein to the contrary,
no distribution shall be made until all Priority Loans are paid in full.
               (b) Net Cash Flow from Operations.
          (i) Net Cash Flow from Operations of Qualified Acquired Assets.
Following (x) the satisfaction of accrued and unpaid interest on Priority Loans,
in proportion to the outstanding Priority Loans, if any, and (y) the
satisfaction of outstanding principal balances on Priority Loans, in proportion
to the outstanding Priority Loans, if any, the General Partner shall cause the
Partnership to distribute all Net Cash Flow from Operations of Qualified
Acquired Assets quarterly on the 15th of January, April, July and October (each
a “Distribution Date”, as follows:
               (A) first, to Inland until such time as Inland has received
cumulative distributions in an amount sufficient to achieve a 9% Cash-On-Cash
Return (“Inland Priority Return”);
               (B) second, to LMLP in an amount equal to the Preferred Equity
Return;
               (C) third, to LMLP, until such time as LMLP has received
cumulative distributions in an amount sufficient to achieve a 9% Cash-On-Cash
Return (“LMLP Priority Return”);
               (D) fourth, to LMLP until all of the Preferred Equity has been
redeemed (and any allocation of Preferred Equity shall be reduced ratably in
accordance with the Preferred Equity allocation set forth on Schedule 1 hereto);
               (E) fifth, to the Partners pro rata in accordance with their
Percentage Interests until all Capital Contributions related to Qualified
Acquired Assets made by the Partners have been returned (for the purposes of
this Section 7.1(a)(i)(E), Capital Contributions made by Inland related to the
Qualified Acquired Assets shall include Acquisition Fees (if any) paid by Inland
and Capital Contributions made by LMLP related to the Qualified Acquired Assets
shall include 17.65% of the amount of the Acquisition Fees (if any) paid by
Inland); and
               (F) thereafter, (x) so long as LMLP GP is the General Partner,
(1) 65% to Inland and (2) 35% to LMLP, or (y) so long as LMLP GP is no longer
the General Partner, (2) 85% to Inland and (2) 15% to LMLP.
          (ii) Net Cash Flow from Operations of Qualified Assumed Assets.
Following (x) the satisfaction of accrued and unpaid interest on Priority Loans,
in proportion to the outstanding Priority Loans, if any, and (y) the
satisfaction of outstanding principal balances on Priority Loans, in proportion
to the outstanding Priority Loans, if any, the General Partner shall cause the
Partnership to distribute all Net Cash Flow from Operations of Qualified Assumed
Assets quarterly on the Distribution Dates, as follows:

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               (A) first, to Inland until such time as Inland has received the
Inland Priority Return;
               (B) second, to LMLP in an amount equal to the Preferred Equity
Return;
               (C) third, to LMLP, until such time as LMLP has received the LMLP
Priority Return;
               (D) fourth, to LMLP until all of the Preferred Equity has been
redeemed (and any allocation of Preferred Equity shall be reduced ratably in
accordance with the Preferred Equity allocation set forth on Schedule 1 hereto);
               (E) fifth, to Inland until all Capital Contributions related to
Qualified Assumed Assets made by Inland have been returned;
               (F) sixth, to LMLP until all Capital Contributions (excluding
Preferred Equity Capital Contributions) made by LMLP or credited on LMLP’s
behalf have been returned; and
               (G) thereafter, (x) so long as LMLP GP is the General Partner,
(1) 65% to Inland and (2) 35% to LMLP, or (y) so long as LMLP GP is no longer
the General Partner, (2) 85% to Inland and (2) 15% to LMLP.
               (c) Net Cash Flow from Sales and Refinancings.
          (i) Net Cash Flow from Sales and Refinancings of Qualified Acquired
Assets. Following (w) the satisfaction of accrued and unpaid interest on
Priority Loans, in proportion to the outstanding Priority Loans, if any, and
(x) the satisfaction of outstanding principal balances on Priority Loans, in
proportion to the outstanding Priority Loans, if any, the General Partner shall
cause the Partnership to distribute Net Cash from Sales and Financings of
Qualified Acquired Assets as soon as practicable after the receipt of such Net
Cash from Sales or Refinancings of Acquired Assets, as follows:
               (A) first, to LMLP to the extent of any unpaid Preferred Equity
Redemption Amount related to a prior sale or refinancing;
               (B) second, to Inland to the extent of any unpaid Inland Priority
Return;
               (C) third, to LMLP to the extent of any accrued and unpaid
Preferred Equity Return;
               (D) fourth, to LMLP to the extent of any unpaid LMLP Priority
Return;
               (E) fifth, to the Partners pro rata in accordance with their
Percentage Interests until all Capital Contributions related to Qualified
Acquired Assets made by

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the Partners have been returned (for the purposes of this Section 7.1(b)(i)(E),
Capital Contributions made by Inland related to the Qualified Acquired Assets
shall include Acquisition Fees (if any) paid by Inland and Capital Contributions
made by LMLP related to the Qualified Acquired Assets shall include 17.65% of
the amount of the Acquisition Fees (if any) paid by Inland); and
               (F) thereafter, (x) so long as LMLP GP is the General Partner,
(1) 65% to Inland and (2) 35% to LMLP, or (y) so long as LMLP GP is no longer
the General Partner, (2) 85% to Inland and (2) 15% to LMLP.
                    (ii) Net Cash Flow from Sales and Refinancings of Qualified
Assumed Assets. Following (w) the satisfaction of accrued and unpaid interest on
Priority Loans, in proportion to the outstanding Priority Loans, if any, and
(x) the satisfaction of outstanding principal balances on Priority Loans, in
proportion to the outstanding Priority Loans, if any, the General Partner shall
cause the Partnership to distribute Net Cash from Sales and Financings of
Qualified Assumed Assets as soon as practicable after the receipt of such Net
Cash from Sales or Refinancings of Qualified Assumed Assets, as follows:
               (A) first, to LMLP to the extent of any unpaid Preferred Equity
Redemption Amount related to a prior sale or refinancing;
               (B) second, to Inland to the extent of any unpaid Inland Priority
Return;
               (C) third, to LMLP to the extent of any accrued and unpaid
Preferred Equity Return;
               (D) fourth to LMLP in an amount equal to the Preferred Equity
Redemption Amount related to such Qualified Assumed Asset (but in no event will
the total amount distributed under this clause (D) exceed the outstanding
Preferred Equity Capital Contribution);
               (E) fifth, to LMLP to the extent of any unpaid LMLP Priority
Return;
               (F) sixth, to Inland until all Capital Contributions related to
Qualified Assumed Assets made by Inland have been returned;
               (G) seventh, to LMLP until all Preferred Equity Capital
Contributions have been returned or redeemed;
               (H) eighth, to LMLP until all Capital Contributions related to
Qualified Assumed Assets (excluding Preferred Equity Capital Contributions) made
by LMLP or credited on LMLP’s behalf have been returned; and
               (I) thereafter, (x) so long as LMLP GP is the General Partner,
(1) 65% to Inland and (2) 35% to LMLP, or (y) so long as LMLP GP is no longer
the General Partner, (1) 85% to Inland and (2) 15% to LMLP.

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               (d) Restrictions on Use of Distributable Cash. Distributable Cash
shall not be used to acquire Qualified Assets or make capital improvements on
Qualified Assets unless approved in accordance with Section 3.4 hereof.
               (e) Withholdings. The General Partner is authorized to withhold
from distributions or allocations to any Partner (or, in the event there are
insufficient funds, require such Partner to contribute to the Partnership) and
to pay over to any federal, state or local government any amounts required to be
withheld pursuant to the Code or any provisions of any other federal, state or
local law with respect to any payment, distribution or allocation to the
Partnership or such Partner and shall allocate any such amounts to such Partner
with respect to which such amount was withheld. All amounts so withheld
(including such amounts contributed by the Partner) shall be treated as amounts
distributed to such Partner, and will reduce the amount otherwise distributable
to such Partner, pursuant to this Article VII for all purposes under this
Agreement.
               (f) Restrictions on Distributions. Notwithstanding anything to
the contrary contained in this Section 7.1, the Partnership shall not make a
distribution to the extent that, at the time of such distribution and after
giving effect to such distribution, all liabilities of the Partnership (other
than liabilities to the Partners on account of their Capital Contributions or
liabilities for which the recourse of creditors is limited to specific assets of
the Partnership) shall exceed the Fair Market Value of the Partnership assets,
except that the Fair Market Value of Qualified Asset that is subject to a
liability for which the recourse of the creditors is limited shall be included
in the Partnership assets only to the extent that the Fair Market Value of such
Qualified Asset exceeds that liability.
ARTICLE VIII
TRANSFER; REMOVAL OF GENERAL PARTNER
               Section 8.1 Prohibition on Transfers and Withdrawals by Partners.
               (a) The Partners shall be prohibited from, directly or
indirectly, transferring, assigning, pledging or hypothecating their respective
interests (or any part of such interests) in the Partnership and any attempted
transfer shall be void ab initio; provided, that the following transfers shall
be permitted:
          (i) assignments of a Partner’s interest in the Partnership (but only
its entire interest) to an Affiliate of such Partner, but only upon fifteen
(15) days written notice to the other Partners;
          (ii) transfers up to 49% of the ownership interests in a Partner, so
long as the management of such Partner immediately prior to such transfer
possesses, directly or indirectly, the power to direct or cause the direction of
the management or policies of such Partner following such transfer, whether
through the ability to exercise voting power, by contract or otherwise;
          (iii) transfers by inheritance, devise, bequest or by operation of law
upon the death of a natural person; and

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          (iv) sales, transfers or issuance of shares of capital stock in LXP
and securities convertible into capital stock in LXP, provided a class of
capital stock in LXP is listed on a nationally recognized stock exchange or
market.
               (b) Except as provided in this Section 8.1 and in Section 8.2,
Section 11.1 and Section 11.2 hereof, the Partners shall be prohibited from
withdrawing from the Partnership. If any Partner withdraws from the Partnership,
it shall be and remain liable for all obligations and liabilities incurred by it
as a Partner, and shall be liable to the Partnership and the other Partners for
all indemnifications set forth herein and for any liabilities, losses, claims,
damages, costs and expenses (including reasonable attorneys’ fees) incurred by
the Partnership as a result of any withdrawal in breach of this Agreement.
               Section 8.2 Removal of LMLP GP as General Partner. Upon a Removal
Event, Inland shall have the right to remove the General Partner for a period of
sixty (60) days following the occurrence of a Removal Event, and if such right
is timely exercised, Inland shall have the right to appoint either Inland or an
Affiliate of Inland as the new General Partner. Such removal of LMLP GP shall be
effective ten (10) Business Days after receipt by LMLP GP of written notice from
Inland. Upon such removal, notwithstanding anything in this Agreement or the
Management Agreement to the contrary, (a) LMLP GP shall cease to be a general
partner and a partner of the Partnership; (b) two of the three members of the
Executive Committee appointed by LMLP shall be removed and replacements shall be
appointed by Inland; (c) the Management Agreement shall terminate; and (d)
either Inland or one of its Affiliates shall be appointed the General Partner of
the Partnership and this Agreement shall be amended to reflect such appointment.
ARTICLE IX
TERMINATION
               Section 9.1 Dissolution. The Partnership shall dissolve and
commence winding up and liquidating upon the first to occur of any of the
following (collectively, the “Liquidating Events”):
          (i) the reduction to cash or cash equivalents (other than purchase
money notes obtained by the Partnership from the sale of Qualified Asset) of the
last remaining Qualified Asset;
          (ii) the agreement in writing by the Partners to dissolve the
Partnership;
          (iii) the entry of a decree of judicial dissolution of the Partnership
pursuant to Section 17-802 of the Act;
          (iv) the election of any Partner to dissolve the Partnership on the
seventh anniversary of March 1, 2008 or any anniversary thereafter;
          (v) all of the Qualified Assets have been sold to LMLP, or its
designees, or to Inland, or its designees, pursuant to the exercise of the
Buy/Sell as provided in Section 11.2 hereof;

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          (vi) the Bankruptcy of any LMLP Partner or Inland;
          (vii) the election of LMLP to dissolve the Partnership after (A) LMLP
GP is no longer the General Partner and (B) a breach by Inland or the General
Partner of (x) Articles VI or VII hereof, which remains uncured for thirty
(30) days following receipt of notice of such breach from LMLP, or (y)
Section 12.19 hereof.
          (viii) the election of Inland to dissolve the Partnership after the
removal of LMLP GP as the General Partner upon a Removal Event.
               Section 9.2 Termination. In all cases of dissolution of the
Partnership, the business of the Partnership shall be wound up and the
Partnership terminated as promptly as practicable thereafter, and each of the
following shall be accomplished:
          (i) The Liquidator shall cause to be prepared a statement setting
forth the assets and liabilities of the Partnership as of the date of
dissolution, a copy of which statement shall be furnished to each Partner;
          (ii) The Qualified Assets and assets of the Partnership shall be
liquidated by the Liquidator as promptly as possible, but in an orderly and
businesslike and commercially reasonable manner, consistent with maximizing the
price to be received. The Liquidator in its reasonable discretion shall
determine whether to sell any Qualified Asset at a public or private sale, for
such price and on such terms as the Liquidator shall determine in its sole
discretion. The Liquidator may, in the exercise of its good faith business
judgment and if commercially reasonable, determine not to sell a portion of the
Qualified Assets and assets of the Partnership, in which event such Qualified
Assets and assets shall be distributed in kind pursuant to clause (iv) below;
          (iii) Any Profit or Loss realized by the Partnership upon the sale or
other disposition of its assets pursuant to Section 9.2(ii) above shall be
allocated to the Partners as required by Article VI hereof; and
          (iv) The proceeds of sale and all other assets of the Partnership
shall be applied and distributed as follows and in the following order of
priority:
               (A) To the payment of the debts and liabilities of the
Partnership and the expenses of Liquidation;
               (B) To the setting up of any reserves which the Liquidator shall
reasonably determine to be necessary for contingent, unliquidated or unforeseen
liabilities or obligations of the Partnership or the Partners arising out of or
in connection with the Partnership. Such reserves may, in the discretion of the
Liquidator, be paid over to a national bank or national title company selected
by it and authorized to conduct business as an escrowee to be held by such bank
or title company as escrowee for the purposes of disbursing such reserves to
satisfy the liabilities and obligations described above, and at the expiration
of such period as the Liquidator may reasonably deem advisable, distribute any
remaining balance in the manner set forth below; and

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               (C) The balance, if any, to the Partners in accordance with
Sections 7.1(c) hereof.
               No payment or distribution in any of the foregoing categories
shall be made until all payments in each prior category shall have been made in
full. If the payments due to be made in any of the foregoing categories exceed
the remaining assets available for such purpose, such payment shall be made to
the Persons entitled to receive the same pro rata in accordance with the
respective amount due them.
               Payments described in clause (iv) above must be made in cash. The
Partners shall continue to share profits, losses and other tax items during the
period of liquidation in the same proportions as before dissolution.
               Section 9.3 Certificate of Cancellation. Upon completion of the
distribution of the Partnership’s assets as provided in this Article IX and the
completion of the winding-up of the affairs of the Partnership, the Partnership
shall be terminated, and the Liquidator shall cause the filing of a certificate
of cancellation of the certificate of limited partnership in the office of the
Secretary of State of the State of Delaware in accordance with the Act and shall
take all such other actions as may be necessary to terminate the Partnership in
accordance with the Act and shall take such other actions as may be necessary to
terminate the Partnership’s registration in any other jurisdictions where the
Partnership is registered or qualified to do business.
               Section 9.4 Acts in Furtherance of Liquidation. Each Partner or
former Partner, upon the request of the Liquidator, shall promptly execute,
acknowledge and deliver all documents and other instruments as the Liquidator
shall reasonably request to effectuate the proper dissolution and termination of
the Partnership, including the winding up of the business of the Partnership.
ARTICLE X
REPRESENTATIONS OF THE PARTNERS
               Section 10.1 Representations of Inland. Inland hereby represents
and warrants to the LMLP Partners and the Partnership as follows:
          (i) this Agreement constitutes the valid and binding agreement of
Inland, enforceable against Inland in accordance with its terms, subject as to
enforcement of bankruptcy, insolvency and other similar laws affecting the
rights of creditors and to general principles of equity;
          (ii) Inland has been duly formed and is validly existing as a limited
liability company in good standing under the laws of the State of Delaware, with
all requisite power and authority to enter into this Agreement, to carry out the
provisions and conditions hereof and to perform all acts necessary or
appropriate to consummate all of the transactions contemplated hereby;
          (iii) Inland has all requisite power and authority to enter into this
Agreement, to carry out the provisions and conditions hereof and to perform all
acts

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necessary or appropriate to consummate all of the transactions contemplated
hereby and no further action by Inland is necessary to authorize the execution
or delivery of this Agreement;
          (iv) this Agreement has been duly and validly executed and delivered
by Inland and the execution, delivery and performance hereof by Inland does not
and will not (i) require the approval of any other Person, or (ii) contravene or
result in any breach of or constitute any default under, or result in the
creation of any lien upon Inland’s assets under, any indenture, mortgage, loan
agreement, lease or other agreement or instrument to which Inland is a party or
by which Inland or any of its assets is bound;
          (v) the formation of the Partnership does not and the consummation of
the transactions contemplated herein will not result in any violation of the
organizational documents of Inland;
          (vi) Inland has the financial capacity to perform its obligations
under this Agreement;
          (vii) no finder’s, broker’s or similar fee or commission has been paid
or shall be paid by Inland to any individual or organization in connection with
the formation of the Partnership; provided, however, that Inland may pay fees to
related parties;
          (viii) there is no action, suit or proceeding pending or, to its
knowledge, threatened against Inland that questions the validity or
enforceability of this Agreement or, if determined adversely to it, would
materially adversely affect the ability of Inland to perform its obligations
hereunder;
          (ix) Inland is not the subject of any Bankruptcy;
          (x) to Inland’s knowledge, Inland has not received from any
governmental agency any notice of violation of any law, statute or regulation
which would have a material adverse effect on the Partnership;
          (xi) to Inland’s knowledge, Inland is not in default in the
performance or observation of any obligation under any agreement or instrument
to which it is a party or by which it or any of its assets is bound, which
default would individually or in the aggregate with other defaults materially
adversely affect the business or financial condition of Inland or the
Partnership; and
          (xii) Inland (which for the purposes of this Section 10.2(x) includes
its partners, members, principal stockholders owning more than ten percent (10%)
of the outstanding capital stock of Inland, and any other constituent entities)
(1) has not been designated as a “specifically designated national and blocked
person” on the most current list published by the U.S. Treasury Department
Office of Foreign Assets Control at its official website,
http://www.treas.gove/ofac/t11sdn.pdf or at any replacement website or other
replacement official publication of such list, and (2) is currently in
compliance with the regulations of the Office of Foreign Asset Control of the
Department of the Treasury and any statute, executive order (including the
September 24, 2001, Executive Order Blocking Property

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and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or
Support Terrorism), or other governmental action relating thereto.
               Section 10.2 Representations of the LMLP Partners. Each LMLP
Partner represents and warrants to Inland and the Partnership as follows:
          (i) this Agreement constitutes the valid and binding agreement of such
LMLP Partner enforceable against such LMLP Partner in accordance with its terms,
subject as to enforcement to bankruptcy, insolvency and other similar laws
affecting the rights of creditors and to general principles of equity;
          (ii) LMLP has been duly formed and is validly existing as a limited
partnership in good standing under the laws of the State of Delaware, with all
requisite power and authority to enter into this Agreement, to carry out the
provisions and conditions hereof and to perform all acts necessary or
appropriate to consummate all of the transactions contemplated hereby;
          (iii) LMLP GP has been duly formed and is validly existing as a
limited liability company in good standing under the laws of the State of
Delaware, with all requisite power and authority to enter into this Agreement,
to carry out the provisions and conditions hereof and to perform all acts
necessary or appropriate to consummate all of the transactions contemplated
hereby;
          (iv) such LMLP Partner has all requisite power and authority to enter
into this Agreement, to carry out the provisions and conditions hereof and to
perform all acts necessary or appropriate to consummate all of the transactions
contemplated hereby and no further action by such LMLP Partner is necessary to
authorize the execution or delivery of this Agreement;
          (v) this Agreement has been duly and validly executed and delivered by
such LMLP Partner and the execution, delivery and performance hereof by such
LMLP Partner does not and will not (x) require the approval of any other Person
or (y) contravene or result in any breach of or constitute any default under, or
result in the creation of any lien upon such LMLP Partner’s assets under, any
indenture, mortgage, loan agreement, lease or other agreement or instrument to
which such LMLP Partner or any LMLP Affiliated Party is a party or by which such
LMLP Partner or any of its assets is bound;
          (vi) to such LMLP Partner’s knowledge, such LMLP Partner is not in
default in the performance or observation of any obligation under any agreement
or instrument to which it is a party or by which it or any of its assets is
bound, which default would individually or in the aggregate with other defaults
materially adversely affect the business or financial condition of such LMLP
Partner or the Partnership;
          (vii) the formation of the Partnership does not and the consummation
of the transactions contemplated herein will not result in any violation of the
organizational documents of such LMLP Partner;

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          (viii) no finder’s, broker’s or similar fee or commission has been
paid or shall be paid to any individual or organization in connection with the
formation of the Partnership except for fees payable to Wachovia Capital
Markets, LLC, which shall be paid by LMLP and not the Partnership;
          (ix) there is no action, suit or proceeding pending or, to its
knowledge, threatened against such LMLP Partner that questions the validity or
enforceability of this Agreement or, if determined adversely to it, would
materially adversely affect the ability of such LMLP Partner to perform its
obligations hereunder;
          (x) such LMLP Partner is not the subject of any Bankruptcy;
          (xi) to such LMLP Partner’s knowledge, such LMLP Partner has not
received from any governmental agency any notice of violation of any law,
statute or regulation which would have a material adverse effect on the
financial condition of such LMLP Partner or of the Partnership;
          (xii) each LMLP Partner has the financial capacity to perform its
obligations under this Agreement; and
          (xiii) each LMLP Partner (which for the purposes of this
Section 10.2(x) includes its partners, members, principal stockholders owning
more than ten percent (10%) of the outstanding capital stock of such LMLP
Partner, and any other constituent entities) (1) has not been designated as a
“specifically designated national and blocked person” on the most current list
published by the U.S. Treasury Department Office of Foreign Assets Control at
its official website, http://www.treas.gove/ofac/t11sdn.pdf or at any
replacement website or other replacement official publication of such list, and
(2) is currently in compliance with the regulations of the Office of Foreign
Asset Control of the Department of the Treasury and any statute, executive order
(including the September 24, 2001, Executive Order Blocking Property and
Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support
Terrorism), or other governmental action relating thereto.
ARTICLE XI
SPECIAL PARTNER RIGHTS AND OBLIGATIONS
               Section 11.1 Right of First Offer.
               (a) At any time after the Rights Trigger Date, if either Inland
or LMLP (except if the Rights Trigger Date occurs because of an Event of Default
by an LMLP Partner) wishes to sell their Percentage Interest or cause the
Partnership to sell any Qualified Asset (for the purposes of this section, such
selling Partner, the “ROFO Offering Partner”), the ROFO Offering Partner shall
deliver a written notice (a “ROFO Notice”) to the Other Partner (the “ROFO
Responding Partner)”) specifying to the ROFO Responding Partner in writing the
terms and conditions (the “ROFO Terms”) and the price (the “ROFO Offer Price”)
at which the ROFO Offering Partner would be willing to sell their entire
Percentage Interest or the ROFO Offering Partner would be willing to permit the
Partnership to sell any of the Qualifying Assets, as the case may be, to the
ROFO Responding Partner. Any ROFO Notice shall reference the

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invocation of this Section 11.1 and shall constitute an irrevocable offer from
the ROFO Offering Partner to the ROFO Responding Partner to sell its entire
Percentage Interest or permit the sale by the Partnership of the stated
Qualifying Assets, as the case may be, at the ROFO Offer Price. If the ROFO
Responding Partner does not elect to buy the ROFO Offering Partner’s entire
Percentage Interest or the stated Qualifying Assets, as the case may be, within
forty-five (45) days following receipt of the ROFO Notice by delivering an
election notice to the ROFO Offering Partner (the “ROFO Response Notice”),
subject to Sections 11.1(b) and (c), the ROFO Offering Partner shall be
permitted to sell their entire Percentage Interest or the stated Qualifying
Assets on behalf of the Partnership, as the case may be, to a bona fide third
party pursuant to an arm’s length transaction on terms not more favorable to
such bona fide third party than the ROFO Terms and for an amount equal to or
greater than the ROFO Offer Price (the “Required Third Party Price and Terms”).
In the event the ROFO Responding Partner fails to timely deliver a ROFO Response
Notice, subject to Sections 11.1(b) and (c), the ROFO Offering Partner shall be
permitted to sell its entire Percentage Interest or any of the Qualifying Assets
on behalf of the Partnership, as the case may be, for the Required Third Party
Price and Terms.
               (b) In the event the ROFO Offering Partner is permitted to sell
its entire Percentage Interest or the stated Qualifying Assets on behalf of the
Partnership, as the case may be, pursuant to Section 11.1(a) above, the ROFO
Offering Partner shall have the right for a period of six (6) months after the
date of the ROFO Notice (the “Third Party Sale Period”) to sell its entire
Percentage Interest or the stated Qualifying Assets on behalf of the
Partnership, as the case may be, to a bona fide third party for and on the
Required Third Party Price and Terms. In the event the ROFO Offering Partner
fails to consummate the sale of its entire Percentage Interest or the stated
Qualifying Assets on behalf of the Partnership, as the case may be, for the
Required Third Party Price prior to the expiration of the Third Party Sale
Period, the ROFO Offering Partner’s right to sell its entire Percentage Interest
or the stated Qualifying Assets on behalf of the Partnership, as the case may
be, to a bona fide third party will be revoked until such time as the ROFO
Offering Partner has repeated the process set forth in Section 11.1(a) and
provided the ROFO Responding Partner with the right to make its election
pursuant to Section 11.1(a) above.
               (c) Any exercise of the provisions of this Section 11.1 is also
subject to the provisions of Section 11.3 below.
               Section 11.2 Buy/Sell.
               (a) Generally. After the Rights Trigger Date, Inland or LMLP
(except if the Rights Trigger Date occurs because of an Event of Default by an
LMLP Partner), as specified therein (the "Buy/Sell Offering Partner”), may
provide the Other Partner (the “Buy/Sell Responding Partner”) with notice (the
“Buy/Sell Notice”) of a price (the “Buy/Sell Offer Price”) that the Buy/Sell
Offering Partner, or its designated Affiliate(s), is willing to pay to purchase
(A) those Qualified Assets which the Buy/Sell Offering Partner, or its
designated Affiliate(s), desire to purchase if the Buy/Sell Offering Partner, or
its designated Affiliate(s), desire to purchase less than all of the Qualified
Assets from the Partnership, or (B) all of the Qualified Assets if the Buy/Sell
Offering Partner, or its designated Affiliate(s), desire to purchase all of the
Qualified Assets (provided that an offer to purchase all of the Qualified Assets
shall be implemented as a purchase by the Buy/Sell Offering Partner, or its
designated

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Affiliate(s), of the Percentage Interests of the Buy/Sell Responding Partner)
(such Qualified Assets or such Percentage Interests, as the case may be, the
“Buy/Sell Asset”). The Buy/Sell Notice shall include, as an attachment thereto,
a bona fide proposed purchase and sale agreement on terms reasonably customary
for the sale of real estate assets or for the sale of partnership interests in a
limited partnership that owns primarily real estate assets (the “Offered
Agreement”). Upon receipt of the Buy/Sell Notice, the Buy/Sell Responding
Partner shall have forty-five (45) days to provide to the Buy/Sell Offering
Partner a notice (the “Buy/Sell Response Notice”) specifying the Buy/Sell
Responding Partner’s election either, (i) if the Buy/Sell Asset comprises less
than all of the Qualified Assets, to cause the Partnership to sell the Buy/Sell
Asset to the Buy/Sell Offering Partner, or its designated Affiliate(s), at the
Buy/Sell Offer Price pursuant to the Offered Agreement or (y) to purchase (or
have a designated Affiliate(s) purchase) the Buy/Sell Asset from the Partnership
for a purchase price equal to the Buy/Sell Offer Price and on substantially the
same terms and conditions as provided in the Offered Agreement, or, (ii) if the
Buy/Sell Asset comprises all of the Qualified Assets, purchase the Percentage
Interest of the Buy/Sell Offering Partner or sell its Percentage Interest to the
Buy/Sell Offering Partner, or its designated Affiliate(s), for a purchase price
equal to the amount the Buy/Sell Responding Partner would receive under
Section 9.2 hereof if the Partnership assets were sold at the Buy/Sell Offer
Price and the Partnership were liquidated and dissolved (the “Buy/Sell
Responding Interest Price”) and on substantially the same terms and conditions
as provided in the Offered Agreement. Any Buy/Sell Notice made with respect to
all of the Qualified Assets in connection with an Event of Default shall
supersede and render of no further effect any Buy/Sell Notice or ROFO Notice
(x) made with respect to less than all of the Qualified Assets and (y) to which
no Buy/Sell Response Notice or ROFO Response Notice, as the case may be, has
been provided to the Buy/Sell Offering Partner or ROFO Offering Partner, as the
case may be.
               (b) Buy/Sell Responding Partner’s Election to Purchase. If the
Responding Partner timely delivers a Buy/Sell Response Notice that specifies the
Buy/Sell Responding Partner’s election to purchase the Buy/Sell Asset, as
described in Section 11.2(a) above, then the Buy/Sell Responding Partner shall
have up to seventy-five (75) days from the date of the delivery of the Buy/Sell
Response Notice to close the purchase of the Buy/Sell Asset on substantially the
same terms and conditions as contained in the Offered Agreement.
               (c) Buy/Sell Responding Partner’s Election not to Purchase. If
the Buy/Sell Responding Partner timely delivers a Buy/Sell Response Notice that
specifies the Buy/Sell Responding Partner’s election not to purchase the
Buy/Sell Asset, or if the Buy/Sell Responding Partner fails to deliver a timely
Buy/Sell Response Notice, then (i) if the Buy/Sell Asset comprises less than all
of the Qualified Assets, the General Partner shall cause the Partnership to
proceed to close the acquisition of the Buy/Sell Asset at the Buy/Sell Offer
Price in accordance with the terms and conditions of the Offered Agreement,
provided, however, that such closing must take place within the seventy-five
(75) day period beginning on the date of delivery of the Buy/Sell Response
Notice, or, (ii) if the Buy/Sell Asset comprises all of the Qualified Assets,
the Buy/Sell Offering Partner shall purchase the Percentage Interests of the
Buy/Sell Responding Partner within the seventy-five (75) day period described in
clause (i) above, for the Buy/Sell Responding Interest Price. In determining the
amount of the Buy/Sell Responding Interest Price, it will be assumed that no
reserves will be required pursuant to Section 9.2 hereof.

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               Section 11.3 Provisions Applicable to Right of First Offer and
Buy/Sell
               (a) The Purchasing Partner shall deliver to a mutually acceptable
escrow agent a non-refundable cash deposit within forty-five (45) days of the
Responding Partner’s actual or deemed notice in an amount equal to the lesser of
(i) five percent (5%) of the Offer Price, as applicable, or (ii) $1,000,000 (the
“Deposit”) to secure the Purchasing Partner’s obligations hereunder.
               (b) Closing of any transfer pursuant to Section 11.1 or
Section 11.2 above (“Closing”) shall occur on the thirtieth (30th) day following
the date of the escrow agent’s receipt of the Purchasing Partner’s deposit as
contemplated by Section 11.3(b) above (or, if such day is not a Business Day,
the next succeeding Business Day) (the “Closing Date”), at the principal place
of business of the Partnership, or at such other time and place as may be
mutually agreed upon by the Purchasing Partner and the Selling Partner, and
(unless otherwise agreed to by the Purchasing Partner and the Selling Partner)
shall be on a cash basis. At such Closing: (i) the Selling Partner shall convey
all of its Percentage Interest in the Partnership, and, if applicable, all of
their debt claims against the Partnership, and warrant that such interests and
claims are free of all adverse claims and encumbrances (unless otherwise agreed
upon by the Purchasing Partner and the Selling Partner); (ii) the Purchasing
Partner shall pay the Selling Partner the Offer Price, less a credit for the
Deposit (which shall be delivered by the escrow agent to the Selling Partner and
the amount thereof credited against the Offer Price), and as adjusted by
customary closing prorations and customary closing costs, in cash; and (iii) the
Selling Partner, the Purchasing Partner and the Partnership shall execute and
deliver such other documents as may be appropriate to effect, evidence and
perfect the transaction.
               (c) Should the Purchasing Partner fail to close the transactions
elected pursuant to Section 11.1 or Section 11.2 above prior to the Closing
Date, the Selling Partner, as its exclusive remedies in the circumstances,
(i) shall be entitled to receive from the escrow agent, as liquidated damages
for such failure, the Deposit deposited pursuant to Section 11.3(b) of this
Agreement, (ii) shall have the right for a period of twelve (12) months after
the scheduled Closing Date (the “Default Sale Period”) to acquire the Purchasing
Partner’s Percentage Interest or interest in the stated Qualified Assets, as the
case may be, for 95% of the Offer Price, and (iii) the Purchasing Partner’s
rights pursuant to Section 11.1 and 11.2 hereof shall be suspended for a period
of twelve (12) months after the scheduled Closing Date.
               (d) In connection with a transfer pursuant to Sections 11.1 or
11.2, the Purchasing Partner may designate an Affiliate or Affiliates to acquire
the Selling Partner’s Percentage Interests or interests in the stated Qualified
Assets, as the case may be, in which event such Affiliate(s) shall acquire such
Percentage Interest or interests in the stated Qualified Assets, as the case may
be, but no such designation or acquisition shall relieve the Purchasing Partner
(as determined without regard to this Section 11.3(e)) from any obligation under
this Article XI.
               (e) Each of Inland and LMLP shall have the right to exercise
either the Right of First Offer pursuant to Section 11.1 above or the Buy/Sell
pursuant to Section 11.2 above (such Partner being the “Initiating Partner”);
provided, however, that upon any

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Initiating Partner’s exercise of either of these provisions, the Other Partner
may not again trigger the provisions of either Section 11.1 or 11.2 until the
termination of all procedures and timeframes pursuant to the Initiating
Partner’s chosen provision.
               (f) As a condition to any transfer by either Inland or LMLP of
its Percentage Interest or the stated Qualified Assets by the Partnership, as
the case may be, pursuant to either Section 11.1 or Section 11.2 of this
Agreement, the Selling Partner must be released at the closing from any
indemnities, guaranties or other credit enhancements granted by such Selling
Partner on behalf of the Partnership to any third party relating to the interest
being transferred.
               (g) As a condition to any transfer by Inland of its Percentage
Interest or the stated Qualified Assets by the Partnership, as the case may be,
pursuant to either Section 11.1 or Section 11.2 of this Agreement, any Preferred
Equity relating to a Qualified Assumed Asset that is being, directly or
indirectly, transferred shall be redeemed as if such Qualified Assumed was sold
and the proceeds were distributed in accordance with Section 7.2(c) hereof.
               (h) If either Inland or LMLP initiates a legal action with
respect to any exercise of the other Partner’s rights under this Article XI, the
losing Partner shall pay all attorneys’ fees and court costs arising in
connection with such legal action.
               (i) Each Partner shall bear its own costs, such as due diligence
expenses and consultants’ and attorneys’ fees, incurred in connection with its
exercise of, or response to, any rights under this Article XI.
ARTICLE XII
GENERAL PROVISIONS
               Section 12.1 Notices.
               (a) Generally. All notices, demands, approvals, consents or
requests provided for or permitted to be given pursuant to this Agreement must
be in writing.
               (b) Manner of Notice. All notices, demands, approvals, consents
and requests to be sent to the Partnership or any Partner pursuant to the terms
hereof shall be deemed to have been properly given or served, if personally
delivered, sent by recognized messenger or next day courier service, or sent by
United States mail, telex or facsimile transmission to the addresses or
facsimile numbers listed below, and will be deemed received, unless earlier
received: (a) if sent by express, certified or registered mail, return receipt
requested, when actually received or delivery refused; (b) if sent by messenger
or courier, when actually received; (c) if sent by telex or facsimile
transmission, on the date sent, so long as a confirming notice is sent by
messenger or courier or by express, certified, registered, or first-class mail;
(d) if delivered by hand, on the date of delivery; and (e) if sent by
first-class mail, seven days after it was mailed. Rejection or other refusal to
accept or the inability to deliver because of changed address of which no notice
was given shall be deemed to be receipt of the notice, demand or request sent.

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If to the Partnership:
  Net Lease Strategic Assets Fund L.P.
c/o Lexington Realty Trust
One Penn Plaza, Suite 4015
New York, New York 10119-4015
Attention: Chief Executive Officer
Fax No. (212) 594-6600
 
   
with a copy to:
  Inland American (Net Lease) Sub, LLC
c/o Inland American Real Estate Trust, Inc.
2901 Butterfield Road
Oak Brook, Illinois 60523
Attention:
Fax No.: (630)
 
   
If to either LMLP Partner:
  c/o Lexington Realty Trust
One Penn Plaza, Suite 4015
New York, New York 10119-4015
Attention: Chief Executive Officer
Fax No. (212) 594-6600

 
   
with a copy of any notice to:
  Post, Heymann & Koffler LLP
Wing A, Suite 211
Two Jericho Plaza
Jericho, New York 11753
Attention: David Heymann, Esq.
Fax No.: (516) 433-2777
 
   
If to Inland:
  Inland American (Net Lease) Sub, LLC
c/o Inland America Real Estate Trust, Inc.
2901 Butterfield Road
Oak Brook, Illinois 60523
Attention: Lori Foust and Scott Wilton
Fax No.: (630)
 
   
and a copy of any notices to:
  Levenfeld Pearlstein LLC
2 North LaSalle, Suite 1300
Chicago, Illinois 60602
Attention: Marc Joseph and Russell Shapiro
Fax No.: (312) 346-8434

               (c) Right to Change Addresses. A Partner shall have the right
from time to time and at any time during the term of this Agreement to change
its notice address or addresses by giving to the Other Partners at least ten
(10) Business Days’ prior written notice thereof in the manner provided by this
Section 12.1.
               Section 12.2 Governing Laws. This Agreement and the obligations
of the Partners hereunder shall be interpreted, construed and enforced in
accordance with the laws of the State of Delaware without regard to its choice
of law provisions. Except as otherwise provided herein, the rights and
obligations of the Partners and the administration and termination of the
Partnership shall be governed by the Act.

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               Section 12.3 Entire Agreement. This Agreement (including the
exhibits and schedules hereto) contains the entire agreement between the
parties, supercedes any prior agreements or understandings between them and may
not be modified or amended in any manner other than pursuant to Section 12.12
hereof; provided that this Agreement shall not supercede the Agreement Relating
To Post Closing Matters, dated December 20, 2007, among the Partners.
               Section 12.4 Waiver. No consent or waiver, express or implied, by
any Partner to or of any breach or default by any other Partner in the
performance by the other Partner of its obligations hereunder shall be deemed or
construed to be a consent or waiver to or of any other breach or default in the
performance by such other Partner of the same or any other obligations of such
other Partner hereunder. Failure on the part of any Partner to complain of any
act or failure to act of any of the other Partners or to declare any of the
other Partners in default, irrespective of how long such failure continues,
shall not constitute a waiver by such Partner of its rights hereunder. No
custom, practice or course of dealings arising among the Partners in the
administration hereof shall be construed as a waiver or diminution of the right
of any Partner to insist upon the strict performance by any other Partner of the
terms, covenants, agreements and conditions herein contained.
               Section 12.5 Validity. If any provision of this Agreement or the
application thereof to any Person or circumstance shall be invalid or
unenforceable to any extent, the remainder of this Agreement and the application
of such provisions to other Persons or circumstances shall not be affected
thereby and shall be enforced to the greatest extent permitted by law.
               Section 12.6 Terminology; Captions. All personal pronouns used in
this Agreement, whether used in the masculine, feminine, or neuter gender, shall
include all other genders; the singular shall include the plural, and vice versa
and shall refer solely to the parties signatory hereto except where otherwise
specifically provided. Titles of Articles, Sections, Subsections, Schedules and
Exhibits are for convenience only, and neither limit nor amplify the provisions
of the Agreement itself, and all references herein to Articles, Sections,
Subsections, Schedules and Exhibits shall refer to the corresponding Articles,
Sections, Subsections, Schedules and Exhibits of this Agreement unless specific
reference is made to such Articles, Sections, Subsections, Schedules and
Exhibits of another document or instrument. Any use of the word “including”
herein shall, unless the context otherwise requires, be deemed to mean
“including without limitation”.
               Section 12.7 Remedies Not Exclusive. Except as otherwise provided
herein, the rights and remedies of the Partnership and of the Partners hereunder
shall not be mutually exclusive, i.e., the exercise of one or more of the
provisions hereof shall not preclude the exercise of any other provisions
hereof. Each of the Partners confirms that damages at law may be an inadequate
remedy for a breach or threatened breach of this Agreement and agrees that in
the event of a breach or threatened breach of any provision hereof, the
respective rights and obligations hereunder shall be enforceable by specific
performance, injunction or other equitable remedy but nothing herein contained
is intended to, nor shall it, limit or affect any rights or rights at law or by
statute or otherwise of any party aggrieved as against the other for breach or
threatened breach of any provision hereof, it being the intention by this
section to

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make clear the agreement of the Partners that the respective rights and
obligations of the Partners hereunder shall be enforceable in equity as well as
at law or otherwise.
               Section 12.8 Action by the Partners. No approval, consent,
designation or other action by a Partner shall be binding upon such Partner
unless the same is in writing and executed on behalf of such Partner by a duly
authorized representative of such Partner.
               Section 12.9 Further Assurances. Each of the Partners shall
hereafter execute and deliver such further instruments and do such further acts
and things as may be required or useful to carry out the intent and purpose of
this Agreement and as are not inconsistent with the terms hereof.
               Section 12.10 Liability of the Limited Partners. Each Limited
Partner’s exposure to liabilities hereunder is limited to its interest in the
Partnership. No Limited Partner shall be personally liable for the expenses,
liabilities, debts, or obligations of the Partnership.
               Section 12.11 Binding Effect. Except as otherwise provided in
this Agreement, every covenant, term, and provision of this Agreement shall be
binding upon and inure to the benefit of the Partners and their respective
successors, transferees, and assigns.
               Section 12.12 Amendments. Except as otherwise provided in this
Agreement, this Agreement may not be amended without the written consent of all
the Partners.
               Section 12.13 Counterparts. This Agreement may be executed in any
number of counterparts and by the different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original, but all such counterparts together shall constitute but one and the
same instrument; signature and acknowledgment pages may be detached from
multiple separate counterparts and attached to a single counterpart so that all
signature and acknowledgement pages are physically attached to the same
document. This Agreement shall become effective upon the execution of a
counterpart hereof by each of the parties hereto and delivery to each of the
Partners of a fully executed original counterpart of this Agreement.
               Section 12.14 Waiver of Partition. Each of the Partners hereby
irrevocably waives any and all rights (if any) that it may have to maintain any
action for partition of any of the Qualified Assets to be acquired.
               Section 12.15 No Third Party Beneficiaries. Supplementing
Section 5.4 hereof, nothing in this Agreement, expressed or implied, is intended
to confer any rights or remedies upon any Person, other than the Partners and,
subject to the restrictions on assignment contained herein, their respective
successors and assigns.
               Section 12.16 Expenses. Each party hereto shall pay all of its
own legal and accounting fees and expenses incurred in connection with the
formation of the Partnership and the preparation and negotiation of this
Agreement and the agreements ancillary hereto.

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               Section 12.17 Jurisdiction; Venue. Each party hereto hereby
irrevocably and unconditionally (a) agrees that any action, suit or other legal
proceeding brought in connection with or relating to this Agreement or any
matter contemplated hereby shall be brought exclusively in a court of competent
jurisdiction located in New Castle County, Delaware, whether a state or federal
court, and shall not be brought in any court or forum outside New Castle County,
Delaware; (b) consents and submits to, and agrees that it will not assert (by
way of motion, as a defense or otherwise) that it is not subject to, personal
jurisdiction in connection with any such action, suit or proceeding in any such
court; and (c) waives to the fullest extent permitted by law, and agrees that it
will not assert (by way of motion, as a defense or otherwise), any claim that
the laying of venue of any such action, suit or proceeding in any such court is
improper or that any such action, suit or proceeding brought in any such court
was brought in an inconvenient forum or should be stayed by reason of the
pendency of some other action, suit or other legal proceeding in a court or
forum other than any such court.
               Section 12.18 Jury Waiver. EACH PARTY HERETO HEREBY IRREVOCABLY
AND UNCONDITIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW, AND AGREES
THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY
RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT OR OTHER LEGAL PROCEEDING IN
CONNECTION WITH OR RELATING TO THIS AGREEMENT OR ANY MATTER CONTEMPLATED HEREBY.
               Section 12.19 REIT Provisions.
               (a) The General Partner and the Partnership shall use
commercially reasonable efforts to cause the Partnership to operate as if it
were subject to the real estate investment trust (“REIT”) rules of the Code
described below, except as otherwise permitted by prior written consent of the
Partners:
                    (i) the “75 percent gross income test” set forth in
Section 856(c)(3) of the Code and the "95 percent gross income test” set forth
in Section 856(c)(2) of the Code; and
                    (ii) the gross assets tests set forth in Section 856(c) of
the Code: (A) the “75 percent asset test" set forth in Section 856(c)(4)(A) of
the Code, (B) the “25 percent asset test" set forth in Section 856(c)(4)(B)(i)
of the Code, (C) the "20 percent value limitation” set forth in
Section 856(c)(4)(B)(ii) of the Code, (D) the “5 percent value limitation” set
forth in Section 856(c)(4)(B)(iii)(I) of the Code and (E) the “10 percent vote
and value limitations” set forth in Sections 856(c)(4)(B)(iii)(II) and (III) of
the Code.
          For purposes of the foregoing tests, any “mezzanine” loans secured by
an equity interest in an entity and any interest therefrom shall not be treated
as satisfying such tests unless such loans and interest are in substantial
compliance with the requirements of Revenue Procedure 2003-65, except as
otherwise permitted by prior written consent of the Partners.
               (b) The General Partner and the Partnership shall use
commercially reasonable efforts to cause the Partnership not to dispose of any
real property in a transaction that would be treated as a “prohibited
transaction” within the meaning of Section

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857(b)(6)(B)(iii) of the Code, unless (i) the transaction qualifies for the safe
harbor, set forth in Section 857(b)(6)(C) of the Code, applied to the
Partnership as if the Partnership were subject to Section 857(b)(6), taking into
account any other “safe harbor” transactions engaged in by the respective
Partner in determining whether seven sales has occurred during the year,
including any such transactions engaged in by a joint venture, partnership or
limited liability company in which such Partner invests (which information such
Partner will provide to the General Partner and Partnership upon written
request), (ii) the transaction is required under this Agreement, (iii) the
property is disposed of in connection with or in lieu of foreclosure, (iv) the
property is transferred in a tax free exchange under the Code, (v) the Partners
consent or (vi) the Executive Committee approves such transaction by a
Supermajority Vote.
               (c) The General Partner and the Partnership shall use
commercially reasonable efforts to cause the Partnership to make distributions
to the Partners in compliance with the “90% distribution requirement” of
Section 857(a)(1) of the Code, provided that the General Partner and the
Partnership shall not be in violation of this Section 12.19(c) if:
                    (i) the Partnership makes the distributions required by
Articles 7 and 9 of this Agreement, and
                    (ii) if the distributions required by Articles 7 and 9 of
this Agreement are insufficient to satisfy the 90% distribution requirement, the
General Partner and Partnership shall
                         (A) notify the Partners of the insufficiency,
                         (B) (B) notify the Partners of whether the Partnership
is fully leveraged to the extent permitted by the debt ratio set forth in
Section 3.8(a) of the Agreement (75%), and
                         (C) (C) (1) if the Partnership’s debt ratio is below
the permitted threshold (75%), the General Partner shall not be required to
incur debt to make additional distributions unless a Partner requests it, in
which case the General Partner and the Partnership shall use commercially
reasonable efforts to cause the Partnership to incur additional debt on
commercially reasonable terms in order to make such additional distributions to
the requesting Partner and (2) if the Partnership’s debt ratio is at the maximum
permitted (75%), the General Partner shall not be required to incur debt to make
additional distributions unless both LMLP and Inland consent, in which case the
General Partner and the Partnership shall use commercially reasonable efforts to
cause the Partnership to incur additional debt on commercially reasonable terms
in order to make such additional distributions to both Partners.
          If an amount otherwise available for distribution pursuant to
Article 7 of the Agreement is used to acquire an Approved Qualified Asset or
fund a capital expenditure approved by a Supermajority Vote of the Executive
Committee or consented to by the distributee Partner, such Partner’s share of
such distribution shall be treated as distributed to the Partner for purposes of
satisfying this Section 12.19(c).
               (d) Without limiting the foregoing, the General Partner and the
Partnership shall take such other reasonable steps as shall be requested in
writing in good faith

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by each Partner and its ultimate Parent entity (Inland Real Estate Trust, Inc.
in the case of Inland and Lexington Realty Trust in the case of LMLP), which the
requesting Partner and Parent believe in good faith is necessary in order for
the Parent (and, in the case of LMLP, LMLP) to continue to qualify as a REIT
(determined assuming that, without regard to its investment in the Partnership,
such ultimate Parent entity (or LMLP) otherwise would qualify as a REIT) and no
other reasonable steps or action could be taken by the requesting Partner or
Parent (in lieu of the Partnership taking any requested steps) to enable the
Parent to so qualify.
               (e) Notwithstanding anything to the contrary in this Agreement,
in no event shall the General Partner or Partnership have any liability to a
Partner or Affiliate with respect to its failure to qualify as a REIT so long as
the General Partner and Partnership have acted in good faith and used
commercially reasonable efforts to satisfy the obligations set forth in this
Section 12.19.
[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.]

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          IN WITNESS WHEREOF, this Agreement is executed effective as of the
date first set forth above.

                  LMLP GP    
 
                LMLP GP LLC    
 
           
 
  By:   /s/ Joseph S. Bonventre
 
        Name: Joseph S. Bonventre         Title: Senior Vice President    
 
                LMLP    
 
                THE LEXINGTON MASTER LIMITED PARTNERSHIP    
 
           
 
  By:   Lex GP-1 Trust, its general partner    
 
           
 
  By:   /s/ Joseph S. Bonventre    
 
                Name: Joseph S. Bonventre         Title: Senior Vice President  
 
 
                INLAND    
 
                INLAND AMERICAN (NET LEASE) SUB, LLC    
 
 
  By:   Inland American Real Estate Trust, Inc.    
 
           
 
  By:   /s/ Lori Foust    
 
                Name: Lori Foust         Title: Treasurer    
 
                The undersigned hereby unconditionally and irrevocably
guarantees the obligations of Inland American (Net Lease) Sub, LLC under
Sections 3.10(c), 3.11, 3.12 and 5.1:    
 
                INLAND AMERICAN REAL ESTATE TRUST, INC.    
 
           
 
  By:   /s/ Lori Foust    
 
                Name: Lori Foust         Title: Treasurer    

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SCHEDULE 1
Capital Commitment; Initial Capital Contribution; Percentage Interest

                                                      Remaining                
        Qualified                         Assumed Assets         Capital  
Initial Capital   Capital   Percentage Partner Name   Commitment   Contribution
  Contribution   Interest
The Lexington Master Limited Partnership
  $ 22,500,000.00     $ 21,516,440.08     $ [                    ]       15.00 %
LMLP GP LLC
  $ 0.00     $ 0.00     $ 0.00       0.00 %
Inland American (Net Lease) Sub, LLC
  $ 127,500,000.00     $ 121,926,493.79     $ [                    ]       85.00
%

Preferred Equity Capital Contribution

                              Preferred Equity Partner Name   Tenant   Address  
Capital Contribution  
The Lexington Master
Limited Partnership
  Advance PCS, Inc.   2401 Cherahala Boulevard, Knoxville, Tennessee   $
2,639,426    
The Lexington Master
Limited Partnership
  American Electric Power   420 Riverport Road, Kingport, Tennessee   $
2,632,074    
The Lexington Master
Limited Partnership
  American Golf
Corporation   11411 N. Kelly Avenue, Oklahoma City, Oklahoma   $ 2,799,838    
The Lexington Master
Limited Partnership
  ASML Lithography
Holding NV   8555 South River Parkway, Tempe, Arizona   $ —    
The Lexington Master
Limited Partnership
  AT&T Wireless Services, Inc.   3201 Quail Springs Parkway, Oklahoma City,
Oklahoma   $ 393,154    
The Lexington Master
Limited Partnership
  Baker Hughes, Inc.   9110 Grogans Mill Road, Houston, Texas   $ —    
The Lexington Master
Limited Partnership
  Baker Hughes, Inc.   2529 West Thorne Drive, Houston, Texas   $ —    
The Lexington Master
Limited Partnership
  Bay Valley Foods, LLC   2935 Van Vactor Way, Plymouth, Indiana   $ 442,985    
The Lexington Master
Limited Partnership
  Corning, Inc.   736 Addison Road, Erwin, New York   $ 929,272    
The Lexington Master
Limited Partnership
  Cox Communications, Inc.   1440 East 15th Street, Tucson, Arizona   $
1,968,812    
The Lexington Master
Limited Partnership
  Dana Corporation   6938 Elm Valley Drive, Kalamazoo, Michigan   $ —    
The Lexington Master
  EDS Information Services,
LLC (Electronic Data   3600 Army Post Road, Des Moines, Iowa   $ 2,811,473  

Schedule 1-1

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                              Preferred Equity Partner Name   Tenant   Address  
Capital Contribution  
Limited Partnership
  Systems Corporation)              
The Lexington Master
Limited Partnership
  Entergy Services, Inc.   5201 W. Barraque Street, Pine Bluff, Arkansas   $
1,633,393    
The Lexington Master
Limited Partnership
  Georgia Power Company   2500 Patrick Henry Parkway, McDonough, Georgia   $
788,468    
The Lexington Master
Limited Partnership
  Honeywell, Inc.   19019 N. 59th Avenue, Glendale, Arizona   $ —    
The Lexington Master
Limited Partnership
  Ivensys Systems, Inc.
(Siebe, Inc.)   70 Mechanic Street, Foxboro, Massachusetts   $ —    
The Lexington Master
Limited Partnership
  Kelsey Hayes Company
(TRW Automotive)   1200 & 12025 Tech Center Drive, Livonia, Michigan   $
6,202,234    
The Lexington Master
Limited Partnership
  Kelsey-Seybold Clinic (St. Lukes Episcopal Health System)   11555 University
Boulevard, Houston, Texas   $ —    
The Lexington Master
Limited Partnership
  Lithia Motors   101 Creger, Fort Collins, Colorado   $ 1,990,894    
The Lexington Master
Limited Partnership
  Litton Loan Servicing L.P. (Credit-Based Asset Servicing and Securitization
LLC)   3500 North Loop Court, McDonough, Georgia   $ 9,333,584    
The Lexington Master
Limited Partnership
  Montgomery County
Management, LLC   17191 St. Lukes Way, Woodlands, Texas   $ 353,061    
The Lexington Master
Limited Partnership
  Nextel of Texas   1600 Eberhardt Road, Temple, Texas   $ 4,209,577    
The Lexington Master
Limited Partnership
  Nextel West Corporation   6455 State Highway 303 N.E., Bremerton, Washington  
$ 3,399,973    
The Lexington Master
Limited Partnership
  Northrop Grumman
Systems Corp.   3943 Denny Avenue, Pascagoula, Mississippi   $ 4,909,261    
The Lexington Master
Limited Partnership
  Omnipoint Holdings, Inc.
(T-Mobile USA, Inc.)   133 First Park Drive, Oakland, Maine   $ 1,042,339    
The Lexington Master
Limited Partnership
  Owens Corning   590 Ecology Lane, Chester, South Carolina   $ 6,949,242    
The Lexington Master
Limited Partnership
  Owens Corning   1901 49th Avenue, Minneapolis, Minnesota   $ 4,960,221    
The Lexington Master
Limited Partnership
  Parkway Chevrolet, Inc.   25500 SH 249, Tomball, Texas   $ 1,394,239    
The Lexington Master
Limited Partnership
  Raytheon Company   1200 Jupiter Road, Garland, Texas   $ —    
The Lexington Master
Limited Partnership
  Seimens Dematic Postal
Automation   1404-1501 Nolan Ryan Parkway, Arlington, Texas   $ —    
The Lexington Master
Limited Partnership
  Silver Spring Gardens, Inc. (Huntsinger Farms, Inc.)   2424 Alpine Road, Eau
Claire, Wisconsin   $ 8,419,695  

 

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                              Preferred Equity Partner Name   Tenant   Address  
Capital Contribution  
The Lexington Master
Limited Partnership
  SKF USA Inc.   324 Industrial Park Road, Franklin, North Carolina   $
1,930,711    
The Lexington Master
Limited Partnership
  Tenneco Automotive Operation Company (Tenneco Automotive Inc.)   904
Industrial Road, Marshall, Michigan   $ —    
The Lexington Master
Limited Partnership
  TI Group Automotive
Systems, LLC (TI
Automotive LTD)   359 Gateway Drive, Livonia, Georgia   $ 629,591    
The Lexington Master
Limited Partnership
  Time Customer Service, Inc. (Time, Inc.)   10419 North 30th Street, Tampa,
Florida   $ —    
The Lexington Master
Limited Partnership
  TRW, Inc. (Experian Information Solutions, Inc.)   601 & 701 Experian Parkway,
Allen, Texas   $ —    
The Lexington Master
Limited Partnership
  Unisource Worldwide, Inc.   109 Stevens Street, Jacksonville, Florida   $
5,297,120    
The Lexington Master
Limited Partnership
  United Technologies Corp.   120 S.E. Parkway Drive, Franklin, Tennessee   $ —
   
The Lexington Master
Limited Partnership
  Voicestream PCS I (T-Mobile USA, Inc.)   2999 S.W. 6th Street, Redmond, Oregon
  $ 3,507,105    
The Lexington Master
Limited Partnership
  Voicestream PCS II (T-Mobile USA, Inc.)   9601 Renner Boulevard, Lenexa,
Kansas   $ 1,247,249    
The Lexington Master
Limited Partnership
  Voicestream PCS II (T-Mobile USA, Inc.)   3265 East Goldstone Drive, Meridian,
Idaho   $ 1,119,875    
The Lexington Master
Limited Partnership
  Voicestream PCS II (T-Mobile USA, Inc.)   3711 San Gabrial, Mission, Texas   $
1,425,877    
The Lexington Master
Limited Partnership
  Wachovia Bank, N.A.   265 Lehigh Street, Allentown, Pennsylvania   $ 2,254,111
 

Qualified Contribution Assets
     Property (defined in Contribution Agreement)

                                  Existing                 Indebtedness at  
Contributed Asset (defined     Primary Tenant   Address   Contribution   in
Contribution Agreement)  
Fee interest
  Advance PCS, Inc.   2401 Cherahala Boulevard,
Knoxville, Tennessee   $ 5,022,910     100% membership
interest in
Lexington Knoxville
Manager LLC  
Fee Interest
  American Electric Power   420 Riverport Road, Kingport,
Tennessee     —     Fee Interest  
Leasehold
interest
  ASML Lithography
Holding NV   8555 South River Parkway, Tempe,
Arizona   $ —     100% membership interest in Lexington Tempe Manager LLC and
100% limited partnership interest

 

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     Property (defined in Contribution Agreement)

                                  Existing                 Indebtedness at  
Contributed Asset (defined     Primary Tenant   Address   Contribution   in
Contribution Agreement)  
 
                  in Lexington Tempe L.P.  
Fee interest
  Baker Hughes, Inc.   2529 West Thorne Drive, Houston,
Texas   $ —     100% membership interest in NLSAF BHI Train GP LLC (after
transfer of general partner interest in Texan Training Limited Partnership from
Lexington BHI Trust) and 99.5% limited partnership interest in Texan Training
Limited Partnership  
Fee interest
  Dana Corporation   6938 Elm Valley Drive, Kalamazoo,
Michigan   $ —     100% membership interest in Lexington Kalamazoo Manager LLC
and 100% limited partnership interest in Lexington Kalamazoo L.P.  
Fee interest
  EDS Information
Services, LLC
(Electronic Data
Systems Corporation)   3600 Army Post Road,
Des Moines,
Iowa   $ 22,761,297     100% membership interest in Lexington TNI Des Moines
Manager LLC and 100% limited partnership interest in Lexington TNI Des Moines
L.P.  
Fee Interest
  Entergy Services, Inc.   5201 W. Barraque Street, Pine Bluff, Arkansas     —  
  Fee Interest  
Fee interest
  Honeywell, Inc.   19019 N. 59th Avenue, Glendale, Arizona   $ —     100%
interest in
Lexington Manager
Glendale LLC  
Fee Interest
  Lithia Motors   101 Creger, Fort Collins, Colorado     —     Fee Interest  
Fee interest
  Owens Corning   590 Ecology Lane, Chester, South
Carolina   $ 13,055,864     100% interest in a to be formed SP Subsidiary and
100% interest in Lexington Chester Industrial LLC  
Fee Interest (to be
acquired)
  Raytheon Company   1200 Jupiter Road, Garland, Texas     —     100% interest
in NLSAF Garland L.P. (to be formed)  
Leasehold interest
  TI Group Automotive
Systems, LLC (TI
Automotive LTD)   359 Gateway Drive, Livonia,
Georgia   $ 9,715,415     100% membership interest in Lexington Livonia TI
Manager LLC and 100% limited partnership interest in Lexington Livonia TI L.P.  
Fee interest
  Unisource Worldwide, Inc.   109 Stevens Street, Jacksonville,
Florida   —     Fee interest  
Ground Lease
  United Technologies   120 S.E. Parkway Drive, Franklin,   —      

 

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

 

     Property (defined in Contribution Agreement)

                                  Existing                 Indebtedness at  
Contributed Asset (defined     Primary Tenant   Address   Contribution   in
Contribution Agreement)  
 
  Corp.   Tennessee              
Fee interest
  Voicestream PCS II (T-Mobile USA, Inc.)   3265 East Goldstone Drive,
Meridian, Idaho   $ 10,033,141     100% membership
interest in
Acquiport Meridian
Manager LLC  
Fee interest
  Voicestream PCS II (T-Mobile USA, Inc.)   3711 San Gabrial, Mission, Texas   $
6,251,476     100% membership interest in Lexington Mission Manager LLC and
99.5% limited partnership interest in Lexington Mission L.P.  
Fee Interest
  Wachovia Bank, N.A.   265 Lehigh Street, Allentown,
Pennsylvania   —      

 

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

 

SCHEDULE 2
Acquisition Parameters
               Required Parameters

  •   Single tenant, net leased, commercial real estate properties in the
office, retail and industrial sectors.     •   Real estate properties that have
a specialized use, design or other feature providing for higher initial
capitalization rates than those of more conventional net leased assets.     •  
Not less than $15,000,000 nor greater than $75,000,000 in total acquisition
costs.     •   Real estate properties that are fully occupied and rent bearing
at purchase.     •   Tenants are solvent.     •   Real estate properties that
have strategic value and/or are mission critical to tenant’s business.

Schedule 2-1

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SCHEDULE 2.8
Qualified Sale Assets

                                  Existing                     Indebtedness at  
Sold Assets (defined in Purchase         Primary Tenant   Address   Sale  
Agreement)   LMLP Sale Affiliate  
40% tenancy-in-common
              100% membership interest in   Lexington TIC OK
interest
              Lexington Oklahoma City Manager   Holdings L.P.
 
          $5,889,549   LLC and 100% limited    
 
  AT&T Wireless   3201 Quail Springs Parkway,   (proportionate   partnership
interest in    
 
  Services, Inc.   Oklahoma City, Oklahoma   share)   Lexington Oklahoma City
L.P.      
Fee interest
                          —   100% membership interest in   LSAC Operating
 
              LSAC Oklahoma City Manager LLC   Partnership L.P.
 
  American Golf   11411 N. Kelly Avenue,       and 100 limited partnership    
 
  Corporation   Oklahoma City, Oklahoma       interest in LSAC Oklahoma L.P.    
 
Fee interest
          $              —   100% membership interest in   Lexington Realty
Trust
 
              NLSAF BHI Christen GP LLC    
 
              (after transfer of general    
 
              partner interest in Texan    
 
              Christen Limited Partnership    
 
              from Lexington BHI Trust) and    
 
              99.5% limited partnership    
 
      9110 Grogans Mill Road,       interest in Texan Christensen    
 
  Baker Hughes, Inc.   Houston, Texas       Limited Partnership      
Fee interest
          $6,584,860   100% membership interest in   LSAC Operating
 
              LSAC Plymouth Manager LLC and   Partnership L.P.
 
  Bay Valley Foods,   2935 Van Vactor Way,       100% limited partnership    
 
  LLC   Plymouth, Indiana       interest in LSAC Plymouth L.P.      
Fee interest
          $9,299,052   100% membership interest in   Triple Net Investment
 
              Lexington TNI Erwin Manager LLC   Company LLC
 
              and 100% limited partnership    
 
      736 Addison Road, Erwin,       interest in Lexington TNI Erwin    
 
  Corning, Inc.   New York       L.P.      
Fee interest
  Cox Communications,   1440 East 15th Street,   $2,257,957   100% membership
interest in Net   Net 3 Acquisition L.P.
 
  Inc.   Tucson, Arizona       2 Cox LLC    

Schedule 2.8-1

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                                  Existing                     Indebtedness at  
Sold Assets (defined in Purchase         Primary Tenant   Address   Sale  
Agreement)   LMLP Sale Affiliate  
Fee interest
          $12,675,000   100% membership interest in   Lexington Acquiport
 
              Acquiport McDonough Manager LLC   Company II, LLC
 
              and 100% limited partnership    
 
  Georgia Power   2500 Patrick Henry Parkway,       interest in Acquiport
McDonough    
 
  Company   McDonough, Georgia       L.P.      
Fee interest
  Ivensys Systems,   70 Mechanic Street,           Lepercq Corporate
 
  Inc. (Siebe, Inc.)   Foxboro, Massachusetts   $              —   Fee interest
  Income Fund L.P.  
Fee interest
  Kelsey Hayes                
 
  Company (TRW   1200 & 12025 Tech Center   $10,467,458   100% interest in
Lexington   Lepercq Corporate
 
  Automotive)   Drive, Livonia, Michigan       Livonia L.L.C.   Income Fund L.P.
 
Fee interest
          $              —   100% membership interest in   Westport View
 
  Kelsey-Seybold           Lexington Sugarland Manager LLC   Corporate Center
L.P.
 
  Clinic (St. Lukes           and 100% limited partnership    
 
  Episcopal Health   11555 University Boulevard,       interest in Lexington
Sugarland    
 
  System)   Houston, Texas       L.P.      
Fee interest
          $ 7,500,000   100% membership interest in   LSAC Operating
 
              LSAC Woodlands Manager LLC and   Partnership L.P.
 
  Montgomery County   17191 St. Lukes Way,       100% limited partnership    
 
  Management, LLC   Woodlands, Texas       interest in LSAC Woodlands L.P.      
Fee interest
          $ 8,757,807   100% membership interest in   Lexington Realty Trust
 
              Lexington Temple Manager LLC    
 
              (current Lexington Temple    
 
              Trust) and 99% limited    
 
      1600 Eberhardt Road,       partnership interest in    
 
  Nextel of Texas   Temple, Texas       Lexington Temple L.P.      
Fee interest
  Nextel West   6455 State Highway 303 N.E.,   $ 6,473,162   100% membership
interest in   Lexington Realty Trust
 
  Corporation   Bremerton, Washington       Lexington Bremerton Manager LLC    
 
Fee interest
                          —   100% membership interest in   LSAC Operating
 
              LSAC Pascagoula Manager LLC and   Partnership L.P.
 
              100% limited partnership    
 
  Northrop Grumman   3943 Denny Avenue,       interest in LSAC Pascagoula    
 
  Systems Corp.   Pascagoula, Mississippi       L.P.      
Fee interest
          $10,226,839   100% membership interest in   Lexington Acquiport
 
              Acquiport Oakland Manager LLC   Company II, LLC
 
  Omnipoint Holdings,           and 100% limited partnership    
 
  Inc. (T-Mobile USA,   133 First Park Drive,       interest in Acquiport
Oakland    
 
  Inc.)   Oakland, Maine       L.P.    

Schedule 2.8-2

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                                  Existing                     Indebtedness at  
Sold Assets (defined in Purchase         Primary Tenant   Address   Sale  
Agreement)   LMLP Sale Affiliate  
Fee interest
      1901 49th            
 
      Avenue, Minneapolis,                     —   100% membership interest in  
Lepercq Corporate
 
  Owens Corning   Minnesota       Lexington Minneapolis L.L.C.   Income Fund
L.P.  
Fee interest
          $  9,308,850   100% membership interest in   LSAC Operating
 
              LSAC Tomball Manager LLC and   Partnership L.P.
 
  Parkway Chevrolet,           100% limited partnership    
 
  Inc.   25500 SH 249, Tomball, Texas       interest in LSAC Tomball L.P.      
Fee interest
          $                 —   100% membership interest in   Lexington
Acquiport
 
              Lexington Arlington Manager LLC   Company II, LLC
 
              and 99.5% limited partnership    
 
  Seimens Dematic   1404-1501 Nolan Ryan       interest in Lexington Arlington  
 
 
  Postal Automation   Parkway, Arlington, Texas       L.P.      
Fee interest
                            —   100% membership interest in   LSAC Operating
 
  Silver Spring           LSAC Eau Claire Manager LLC and   Partnership L.P.
 
  Gardens, Inc.           100% limited partnership    
 
  (Huntsinger Farms,   2424 Alpine Road, Eau       interest in LSAC Eau Claire  
 
 
  Inc.)   Claire, Wisconsin       L.P.      
 
      324 Industrial Park Road,            
Fee interest
  SKF USA Inc.   Franklin, North Carolina   $  1,472,638   Fee interest  
Lexington Realty Trust  
Fee interest
  Tenneco Automotive                
 
  Operation Company                
 
  (Tenneco Automotive   904 Industrial Road,            
 
  Inc.)   Marshall, Michigan -                      —   Fee interest   LXP I,
L.P.  
Fee interest
  Time Customer                
 
  Service, Inc.   10419 North 30th            
 
  (Time, Inc.)   Street, Tampa, Florida   $                 —   Fee interest  
North Tampa Associates  
 
              100% membership interest in    
 
              Lexington Allen Manager LLC and      
Fee interest
  TRW, Inc. (Experian       $                 —   100% limited partnership  
Lexington Texas
 
  Information   601 & 701 Experian Parkway,       interest in Lexington Allen  
Holdings L.P.
 
  Solutions, Inc.)   Allen, Texas       L.P.      
Fee interest
  Voicestream PCS I                
 
  (T-Mobile USA,   2999 S.W. 6th   $  9,605,384   100% membership interest in  
Lepercq Corporate
 
  Inc.)   Street, Redmond, Oregon       Lexington Redmond Manager LLC   Income
Fund II L.P.  
Fee interest
  Voicestream PCS II                
 
  (T-Mobile USA,   9601 Renner Boulevard,   $10,098,936   100% membership
interest in   Lexington Acquiport
 
  Inc.)   Lenexa, Kansas       Acquiport Lenexa Manager LLC   Company II, LLC  
Fee interest
  Litton Loan           100% membership interest in   Lexington Realty Trust
(currently under
  Servicing L.P.           NLSAF McDonough Manager LLC and    
contract)
  (Credit-Based Asset           100% limited partnership    
 
  Servicing and   3500 North Loop Court,       interest in NLSAF McDonough    
 
  Securitization LLC)   McDonough, Georgia                     —   L.P.    

     Property ( defined in Purchase Agreement)

Schedule 2.8-3

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SCHEDULE 3.5
[Intentionally omitted from filing]

 

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SCHEDULE 3.9
LMLP Existing Joint Venture Exclusivity Terms
Lex-Win Acquisition LLC — exclusive vehicle through which LMLP and its
Affiliates will enter into any transaction or acquire directly or indirectly,
any shares of common stock of Wells Real Estate Investment Trust, Inc.
(“Wells”), any interest in Wells or any asset owned by Wells.

Schedule 3.9-1

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SCHEDULE 4.7
INSURANCE REQUIREMENTS
EXHIBIT C
INSURANCE REQUIREMENTS
     The Partnership shall, at a minimum, obtain and maintain, and/or cause the
SP Subsidiaries to obtain and maintain, without interruption, the insurance
coverages stipulated hereunder for the benefit of the Partnership and each
Partner thereof, but only to the extent of such party’s interest in each
Qualified Asset:
     (a) Property and Related Insurance.
          (i) Qualified Assets. At all times following commencement of
construction of any above-ground improvements thereon, each Qualified Asset
shall be insured on a 100% Full Replacement Cost basis. Full Replacement Cost is
defined as the cost of replacing the improvements, together with appurtenances
and betterments in compliance with prevailing building codes, without deduction
for physical depreciation thereof, at the time of replacement of the Qualified
Asset, following a loss. The value so determined shall be binding and
conclusive. The policy shall further provide that, in the event of a total or
constructive total loss, the Partnership or SP Subsidiary shall not be
unreasonably restricted from applying the proceeds to the re-building of the
improvements at such other location as the Partnership shall elect. At all times
following commencement of construction of any vertical improvements thereon,
Qualified Assets shall be insured against physical loss or damage by fire,
lightning and other risks and supplementary perils from time to time included
under Special Form policies including, vandalism and malicious mischief (with
agreed amount endorsements), windstorm, earthquake, and certified and
non-certified acts of terrorism. The policy shall be endorsed to provide
coverage for demolition and increased cost of construction to conform to local
ordinance, and will include “extra expense” and “expediting expense” coverage.
          (ii) Rent Loss/Business Interruption. The Partnership shall maintain,
after substantial completion of any above-ground improvements, rent
loss/business interruption insurance sufficient to prevent the Partnership or
the SP Subsidiary from being a coinsurer under the terms of the policy, and in
an amount equal to twelve months’ projected gross income from the Qualified
Asset. The policy must contain an extended period of indemnity endorsement which
provides that after the loss to the Improvements and personal property has been
repaired, the continued loss of income will be insured until the earlier of such
time that such income returns to the same level it was prior to the loss or the
expiration of six (6) months from the date of restoration. This requirement
shall apply in the event the Partnership, by upon approval of the Executive
Committee by a Supermajority vote,, has elected to offer all or any portion of
the Qualified Asset for rent pursuant to leases or other occupancy agreements.
          (iii) Boiler and Machinery. The Partnership or the SP Subsidiary shall
maintain, after substantial completion of any above-ground improvements, boiler
and machinery insurance covering physical damage to the Qualified Asset and to
the major components of any central heating, air conditioning or ventilation
systems, and such other equipment as is usual for similar properties in the
area. The policy shall include coverage for business interruption, including
expediting and extra expense, in an amount not less than $500,000. Unless the
insurance required in subsections (a) (i), (iii) and (iv) is provided on the
same policy or by the same insurance carrier, a Joint Loss Agreement between
separate primary policies will be required.

Schedule 4.7-1

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

 

          (iv) Builder’s Risk. During the period of any construction, repair,
renovation, restoration or replacement of the improvements or the Qualified
Asset, the Partnership shall obtain and maintain or cause to be obtained and
maintained a completed value “All Risk” Builder’s Risk policy in an amount equal
to one hundred percent (100%) of the replacement cost of the Qualified Asset.
Coverage should include, but not be limited to, collapse, soft costs, transit,
earthquake, flood, windstorm, terrorism, off-site storage, expediting expenses,
demolition and increased cost of construction (for renovation and/or additions
to existing structures), water damage, permission for partial occupancy, and
automatic reinstatement. The policy is to be in an amount not less than the
total value of the Qualified Asset (less the value of such uninsurable items as
land, site preparation, grading, paving, parking lots). The coverage may be
provided as an extension to the property policy in force if the requirements
herein are satisfied, subject to approval by the Partners of the Partnership.
The Partnership shall cause the contracts with any contractors to provide that
(i) such contractor will be responsible for claims arising out of such
contractor’s negligence, and (ii) except to the extent that such contractor’s
tools and equipment will become part of the job, such tools and equipment shall
not be considered insurable items.
          (v) Flood. If the Qualified Asset is located in a federally designated
flood zone A or V and flood insurance has been made available under the National
Flood Insurance Act of 1968, flood insurance is required in an amount equal to
maximum coverage available, replacement cost, or such amount as a mortgage
lender may require.
          (vi) Earthquake. If a Qualified Asset is in an area identified by any
governmental, engineering or any hazard underwriting agencies as being subject
to the peril of earthquake, and the project is in a high-risk seismic area
denoted as Zones 3 and 4 under the Uniform Building Code (UBC), appropriate
earthquake insurance coverage as required by lender is required.
     (b) Liability.
          (i) The Partnership and the SP Subsidiaries shall obtain and maintain
Commercial General Liability insurance on the broadest forms available for
similar risks, written on an “occurrence policy form,” against all claims for
bodily injury, disease or death, property damage, personal injury, certified and
non-certified acts of terrorism products and completed operations, and
contractual liability (deleting any exclusion restricting coverage for
contractual obligations for claims occurring on, in or about the Qualified Asset
and adjoining premises, and for explosion, collapse, and underground property
damage) in an amount of not less than $5,000,000 arising out of any one
occurrence; provided, however that coverage for explosion, collapse, and
underground property damage shall not be required until such time as any
excavation at the Qualified Asset commences, and may be in the form of coverage
carried by the applicable contractor. Such insurance may be provided under a
primary and an umbrella policy or policies, provided that such umbrella policy
or policies shall not exclude “real estate activities.” If liability coverage
for any Qualified Asset procured by the contractor is included under any blanket
policy written on an aggregate form, then the annual aggregate limit of
insurance must apply per location. The policy shall be endorsed to include the
SP Subsidiary, the Partnership, the lender and each Partner thereof as an
additional insured subject to the benefits stipulated under subsection (i)(iv)
hereof. Such insurance will be endorsed as primary and non-contributory with any
other insurance available to the SP Subsidiary, the Partnership, the lender and
each Partner.
          (ii) During any period of construction, repair, restoration,
renovation or replacement of the Qualified Asset, the Partnership shall cause
the general contractor to maintain commercial liability insurance (or the
Partnership’s or SP Subsidiary’s and Contractor’s protective liability insurance
in the name of the Partnership or SP Subsidiary and each Partner thereof), with
extension for, but not limited to, products/completed operations, with limits of
not less than $10,000,000 per occurrence. Completed Operations insurance shall
remain in effect for the length of time statutorily required in the state in
which

Sched. 4.7-2

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the construction occurs. This coverage shall be maintained as was agreed to at
the time of substantial completion of the Qualified Asset and shall be for the
same limits as required above. The Partnership shall also cause the general
contractor to require its subcontractors of any tier to provide confirmation of
commercial liability coverage (including products/completed operations), and
such insurance shall be on a primary and non-contributory basis with a limit of
not less than $1,000,000 per Qualified Asset. The general contractors and the
subcontractors shall have the Partnership and the SP Subsidiary included on the
insurance required herein as additional insureds.
     (c) Worker’s Compensation. The Partnership and the SP Subsidiaries will
maintain Worker’s Compensation as statutorily required and Employer’s Liability
insurance, or their equivalent, for all of their respective employees, and will
cause any of their agents, contractors and subcontractors of any tier to
maintain similar insurance for all their respective employees, to the fullest
extent required under the laws of the jurisdiction in which a Qualified Asset is
located.
     (d) Errors and Omission. The Partnership will cause any professional
consultants, including, but not limited to, architects and engineers, to
maintain coverage in limits of not less than $1,000,000.
     (e) Crime. The Partnership will maintain crime insurance in an amount of
not less than $1,000,000 for the benefit of the Partnership and each Partner
thereof against loss caused by infidelity of its officers, agents, servants and
employees; and against robbery or burglary both on and off premises.
     (f) Other Insurance. In addition to the above, the Partnership and the SP
Subsidiaries shall maintain all insurance, surety and fidelity bonds in amounts
and for such periods that are deemed to be prudent, or are customarily
maintained by persons or entities operating properties of like kind,
construction and occupancy in the locality of each Qualified Asset. Compliance
with insurance requirements will not in itself be construed to be a limitation
of the Partnership’s or the SP Subsidiaries’ liability.
     (g) All Insurance. All insurance required herein will be primary and not
excess over, contributory or participating with any other insurance carried by
individual Partners of the Partnership or their respective affiliates or agents.
     (h) Other Requirements With Respect to Insurance. The following provisions
shall apply with respect to all insurance coverage required above:
          (i) Insurance Companies: All insurance required herein shall be issued
by insurance companies of recognized good standing, with a rating of at least
A-VII in Best’s Key Rating Guide, except for loans in excess of $35,000,000
where required by lender and in in such case a rating of at lease AVII in Best’s
Key Rating Guide, and must be licensed to do business in the state in which the
Qualified Asset is located or must otherwise be acceptable to the Partnership.
Insurance ratings are subject to the approval of mortgagee. Coverage under
blanket policies may be extended by endorsements provided the insurers meet the
requirements stipulated herein. Each policy shall not have more than a $25,000
deductible for any occurrence, except for mandatory deductibles where required
under local regulations, or when required by insurers for specific catastrophic
perils, or with respect to flood insurance pursuant to Section (a)(v) which
deductible shall not exceed $250,000 for any occurrence. An allowance for
deductibles in excess of $25,000 on all-risk policies will be allowed upon the
approval of mortgagee, but in any event cannot exceed $100,000.
          (ii) Evidence of Insurance: The Partnership or the SP Subsidiaries
shall obtain, before the expiration date of each such policy, original policies
(or renewals or extensions of the insurance afforded thereby) or certified
duplicates thereof, or binders evidencing such insurance, or

Sched. 4.7-3

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endorsements, or certificates thereof. Evidence of Property insurance shall be
on ACORD 28 forms acceptable to lenders and naming lender as mortgagee and loss
payee. Certificates of General Liability shall be on ACORD 25 forms and shall
name lender as additional insured.
          (iii) Insurance (Cut-Through Endorsement). Except to the extent
prohibited by applicable law, insurance placed with a non-admitted insurer or
excess and surplus lines insurer will (upon written request of the Partners)
require a “cut-through” endorsement for reinsurance purposes to allow for
recovery directly from a reinsurer in the event of the primary insurer’s
insolvency or cessation of insurance operations. This will be addressed on a
case by case basis, dependent on the insurance carriers involved.
          (iv) Cancellation: The Partnership shall immediately notify each
Partner of the Partnership of any cancellation of, non-renewal, or such material
change as may adversely affect any insurance policy or coverage in force. Each
policy shall contain a provision obligating the insurer to send at least thirty
(30) days’ prior written notice to any party included as an additional insured
or loss payee notifying them of the intent to cancel or make such change, and
that any loss otherwise payable to them thereunder shall be paid notwithstanding
any act or negligence on their part or that of the Partnership which might,
absent such provision, result in a forfeiture of all or part of such insurance
payment.
          (v) Separate Insurance: Without the prior written consent of all
Partners of the Partnership, neither the Partnership not any SP Subsidiary shall
purchase separate insurance concurrent in form or contributing in the event of
loss, with the insurance required hereunder.
          (vi) Payment of Premium. The Partnership or the applicable SP
Subsidiary shall be solely responsible for, and promptly pay when due, any and
all premiums on all such insurance.

Sched. 4.7-4

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EXHIBIT A
Form of Annual Budget
[Intentionally omitted from filing]

Exhibit A-1

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EXHIBIT B
Contribution Agreement
[Intentionally omitted from filing]

Exhibit B-1

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EXHIBIT C
Management Agreement
[Intentionally omitted from filing]

Exhibit C-2

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EXHIBIT D
Purchase Agreement
[Intentionally omitted from filing]

Exhibit D-1

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EXHIBIT E
SP Subsidiary Limited Liability Company Agreement
[Intentionally omitted from filing]

Exhibit E-2

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EXHIBIT F
SP Subsidiary Partnership Agreement
[Intentionally omitted from filing]

Exhibit I-1