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REVOLVING CREDIT AGREEMENT

dated as of December 18, 2009

among

ESSEX PORTFOLIO, L.P.,
a California limited partnership,

THE LENDERS LISTED HEREIN,

PNC BANK, NATIONAL ASSOCIATION
as Administrative Agent,

and

PNC CAPITAL MARKETS LLC
as Sole Lead Arranger and Sole Book Runner

 
 

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TABLE OF CONTENTS

               
Page
1.
 
DEFINITIONS.
 
1
   
1.1
 
Defined Terms
 
1
   
1.2
 
Other Interpretive Provisions
 
21
       
1.2.1
 
Use of Defined Terms
 
21
       
1.2.2
 
Certain Common Terms
 
21
       
1.2.3
 
Accounting Principles
 
22
       
1.2.4
 
Letter of Credit Amounts
 
22
2.
 
LOAN AMOUNTS AND TERMS
 
23
   
2.1
 
Amount and Terms of Commitment
 
23
       
2.1.1
 
No Obligation to Issue Letters of Credit Under Certain Circumstances
 
24
       
2.1.2
 
Letter of Credit Amendments
 
25
       
2.1.3
 
Applicability of ISP98
 
25
   
2.2
 
Swing Line
 
25
       
2.2.1
 
Swing Loans
 
25
       
2.2.2
 
Interest on Swing Loans
 
25
       
2.2.3
 
Principal Payable on Swing Loans
 
26
       
2.2.4
 
Prepayments of Swing Loans
 
26
       
2.2.5
 
Funding of Participations
 
26
       
2.2.6
 
Refinancing of Swing Loans
 
27
       
2.2.7
 
Termination of Swing Line
 
28
       
2.2.8
 
No Swing Loans Upon Default
 
28
   
2.3
 
Procedure for Obtaining Credit (Loans, Swing Loans and Letters of Credit)
 
28
   
2.4
 
Loan Accounts; Notes.
 
29
       
2.4.1
 
Loan Accounts
 
29
       
2.4.2
 
Notes
 
29
   
2.5
 
Letters of Credit.
 
30
       
2.5.1
 
Letter of Credit Drawings and Reimbursements; Funding of Participations.
 
30
       
2.5.2
 
Repayment of Participations
 
31
       
2.5.3
 
Obligations Absolute
 
32
       
2.5.4
 
Role of Letter of Credit Issuer
 
32
       
2.5.5
 
Cash Collateral
 
33
   
2.6
 
Conversion and Continuation Elections of Loans
 
34
       
2.6.1
 
Election to Convert and Renew
 
34
       
2.6.2
 
Notice of Conversion/Continuation
 
34
       
2.6.3
 
Failure to Select a New Interest Period
 
34
       
2.6.4
 
Number of Interest Periods
 
35
   
2.7
 
Voluntary Termination or Reduction of Commitment
 
35
   
2.8
 
Principal Payments
 
35
       
2.8.1
 
Optional Prepayments of the Loans
 
35
       
2.8.2
 
Mandatory Repayments
 
35

 
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2.8.3
 
Repayment at Maturity
 
36
   
2.9
 
Extension of Maturity Date
 
36
   
2.10
 
Interest
 
36
       
2.10.1
 
Accrual Rate
 
36
       
2.10.2
 
Payment
 
37
       
2.10.3
 
Default Interest
 
37
       
2.10.4
 
Maximum Legal Rate
 
37
   
2.11
 
Fees
 
37
       
2.11.1
 
Facility Fee
 
37
       
2.11.2
 
Letter of Credit Fees
 
38
       
2.11.3
 
Other Fees
 
38
   
2.12
 
Computation of Fees and Interest
 
38
   
2.13
 
Payments by Borrower
 
38
       
2.13.1
 
Timing of Payments
 
38
       
2.13.2
 
Non-Business Days
 
39
       
2.13.3
 
Payment May be Made by Administrative Agent
 
39
   
2.14
 
Payments by the Lenders to Administrative Agent
 
39
       
2.14.1
 
Administrative Agent May Make Borrowings Available
 
39
       
2.14.2
 
Obligations of Lenders Several
 
40
       
2.14.3
 
Failure to Satisfy Conditions Precedent
 
40
       
2.14.4
 
Funding Source
 
40
   
2.15
 
Sharing of Payments, Etc.
 
40
   
2.16
 
Defaulting Lender
 
41
       
2.16.1
 
Notice and Cure of Lender Default; Election Period; Electing Lenders
 
41
       
2.16.2
 
Removal of Rights: Indemnity
 
41
       
2.16.3
 
Commitment Adjustments
 
42
       
2.16.4
 
No Election
 
42
3.
 
TAXES, YIELD PROTECTION AND ILLEGALITY.
 
43
   
3.1
 
Taxes
     
43
       
3.1.1
 
Payments Free of Taxes
 
43
       
3.1.2
 
Payment of Other Taxes by Borrower
 
43
       
3.1.3
 
Indemnification by Borrower
 
43
       
3.1.4
 
Evidence of Payments
 
43
       
3.1.5
 
Status of Lenders
 
43
       
3.1.6
 
Treatment of Certain Refunds
 
44
   
3.2
 
Illegality
 
44
   
3.3
 
Increased Costs
 
45
       
3.3.1
 
Increased Costs Generally
 
45
       
3.3.2
 
Capital Requirements
 
45
       
3.3.3
 
Delay in Requests
 
46
   
3.4
 
Funding Losses
 
46
   
3.5
 
Inability to Determine Rates
 
47
   
3.6
 
Certificate of Lender
 
47
   
3.7
 
Mitigation Obligations; Replacement of Lenders
 
47
   
3.8
 
Survival
 
47

 
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4.
 
UNENCUMBERED ASSET POOL.
 
48
   
4.1
 
Additions of Property to the Unencumbered Asset Pool
 
48
   
4.2
 
Delivery of Information
 
51
5.
 
CONDITIONS TO DISBURSEMENTS.
 
52
   
5.1
 
Conditions to Initial Loans
 
52
       
5.1.1
 
Deliveries to Administrative Agent
 
52
       
5.1.2
 
Payment of Fees
 
53
       
5.1.3
 
Payment of Expenses
 
54
   
5.2
 
Conditions of all Borrowings and Letters of Credit
 
54
6.
 
COVENANTS OF BORROWER
 
54
   
6.1
 
Specific Affirmative Covenants
 
54
       
6.1.1
 
Compliance with Law
 
54
       
6.1.2
 
Site Visits
 
55
       
6.1.3
 
Insurance
 
55
       
6.1.4
 
Preservation of Rights
 
56
       
6.1.5
 
Taxes
 
56
   
6.2
 
Payment of Expenses
 
57
   
6.3
 
Financial and Other Information; Certification
 
57
   
6.4
 
Notices
 
60
   
6.5
 
Negative Covenants.
 
61
       
6.5.1
 
Limitations on Certain Activities
 
61
       
6.5.2
 
Acquisition Down-REITs
 
62
   
6.6
 
Type of Business; Development Covenants
 
63
   
6.7
 
Performance of Acts
 
63
   
6.8
 
Keeping Guarantor Informed
 
63
   
6.9
 
Maximum Total Liabilities to Gross Asset Value
 
64
   
6.10
 
Debt Ratios
 
64
   
6.11
 
Fixed Charge Coverage Ratio
 
64
   
6.12
 
Debt Service Coverage Ratio
 
64
   
6.13
 
Maximum Quarterly Dividends
 
64
   
6.14
 
Negative Pledge; Limitations on Affiliate Indebtedness.
 
64
   
6.15
 
Change in Ownership of Borrower or Management of the Unencumbered Asset Pool
Property
 
65
   
6.16
 
Books and Records
 
65
   
6.17
 
Audits
 
65
   
6.18
 
Cooperation
 
66
   
6.19
 
ERISA Plans
 
66
   
6.20
 
Use of Proceeds
 
66
   
6.21
 
Use of Proceeds – Ineligible Securities
 
66
7.
 
Representations and Warranties
 
66
   
7.1
 
Organization of Borrower, Guarantor and each Permitted Affiliate
 
66
   
7.2
 
Authorization
 
66
   
7.3
 
Enforceable Agreement
 
66
   
7.4
 
Good Standing
 
66
   
7.5
 
No Conflicts
 
66
   
7.6
 
Financial Information
 
67

 
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7.7
 
Borrower Not a “Foreign Person”
 
67
   
7.8
 
Lawsuits
 
67
   
7.9
 
Permits, Franchises
 
67
   
7.10
 
Other Obligations
 
67
   
7.11
 
Income Tax Returns
 
67
   
7.12
 
No Event of Default
 
67
   
7.13
 
ERISA Plans
 
68
   
7.14
 
Location of Borrower
 
68
   
7.15
 
No Required Third Party/Governmental Approvals
 
68
   
7.16
 
Regulated Entities
 
68
8.
 
DEFAULT AND REMEDIES
 
68
   
8.1
 
Events of Default
 
68
   
8.2
 
Remedies
 
71
       
8.2.1
 
Termination of Commitment to Lend
 
71
       
8.2.2
 
Acceleration of Loans
 
71
       
8.2.3
 
Security for Letters of Credit
 
71
       
8.2.4
 
Exercise of Rights and Remedies
 
71
   
8.3
 
Application of Funds
 
71
9.
 
ADMINISTRATIVE AGENT
 
72
   
9.1
 
Appointment and Authority
 
72
   
9.2
 
Rights as a Lender
 
72
   
9.3
 
Exculpatory Provisions
 
73
       
9.3.1
 
Limitation of Administrative Agent’s Duties
 
73
       
9.3.2
 
Limitation of Administrative Agent’s Liability
 
73
       
9.3.3
 
Limitation of Administrative Agent’s Responsibilities
 
73
   
9.4
 
Reliance by Administrative Agent
 
74
   
9.5
 
Delegation of Duties
 
74
   
9.6
 
Resignation of Administrative Agent
 
74
       
9.6.1
 
Notice of Resignation
 
74
       
9.6.2
 
Resignation by PNC Bank
 
75
   
9.7
 
Non-Reliance on Administrative Agent and Other Lenders
 
75
   
9.8
 
No Other Duties, Etc.
 
75
   
9.9
 
Administrative Agent May File Proofs of Claim
 
76
   
9.10
 
Release of Permitted Affiliate from Payment Guaranty
 
76
10.
 
MISCELLANEOUS PROVISIONS
 
76
   
10.1
 
Amendments and Waivers
 
76

 
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10.2
 
Notices; Effectiveness; Electronic Communication
 
78
   
10.3
 
No Waiver; Cumulative Remedies
 
80
   
10.4
 
Costs and Expenses; Indemnity; Waiver of Consequential Damages, Etc.
 
80
   
10.5
 
Successors and Assigns
 
82
   
10.6
 
Confidentiality
 
85
   
10.7
 
Right of Setoff
 
86
   
10.8
 
No Third Parties Benefited
 
86
   
10.9
 
Payments Set Aside
 
86
   
10.10
 
Counterparts; Integration; Effectiveness
 
87
   
10.11
 
Survival of Representations and Warranties
 
87
   
10.12
 
Severability
 
87
   
10.13
 
Replacement of Lenders
 
87
   
10.14
 
Governing Law; Jurisdiction; Etc.
 
88
   
10.15
 
Waiver of Jury Trial
 
89
   
10.16
 
Judicial Reference
 
89
   
10.17
 
USA PATRIOT Act Notice
 
90
   
10.18
 
Time of the Essence
 
90
   
10.19
 
No Fiduciary Relationship
 
90

SCHEDULE 1.1
 
LENDERS' NAMES AND PRO RATA SHARES
SCHEDULE 1.2
 
ADMINISTRATIVE AGENT'S OFFICE; ADMINISTRATIVE AGENT'S PAYMENT OFFICE
SCHEDULE 1.3
 
PERMITTED AFFILIATES
SCHEDULE 1.4
 
PROCESSING AND RECORDATION FEES
     
EXHIBIT A-1
 
UNENCUMBERED STABILIZED ASSET PROPERTY
EXHIBIT A-2
 
UNENCUMBERED WORK IN PROCESS PROPERTY
EXHIBIT B
 
FORM OF NOTICE OF BORROWING OR CONVERSION/CONTINUATION
EXHIBIT C
 
FORM OF LETTER OF CREDIT APPLICATION
EXHIBIT D
 
COMPLIANCE CERTIFICATE
EXHIBIT E
 
FORM OF ASSIGNMENT AND ASSUMPTION
EXHIBIT F-1
 
FORM OF PAYMENT GUARANTY (GUARANTOR)
EXHIBIT F-2
 
FORM OF PAYMENT GUARANTY (PERMITTED AFFILIATE)
EXHIBIT G-1
 
FORM OF REVOLVING NOTE
EXHIBIT G-2
 
FORM OF SWING LINE NOTE

 
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REVOLVING CREDIT AGREEMENT

This REVOLVING CREDIT AGREEMENT, dated as of December 18, 2009 (this
“Agreement”), is among ESSEX PORTFOLIO, L.P., a California limited partnership
(“Borrower”), the several financial institutions from time to time party to this
Agreement (collectively, the “Lenders” and individually, a “Lender”), and PNC
BANK, NATIONAL ASSOCIATION, as administrative agent for the Lenders (in such
capacity, “Administrative Agent”) and as Swing Line Lender and L/C Issuer.

Background

WHEREAS, Borrower has requested that Lenders make available, and Administrative
Agent administer, an unsecured revolving credit facility in the maximum
principal amount of $200,000,000; and

WHEREAS, Lenders are willing to make available to Borrower, and Administrative
Agent is willing to administer, such facility, subject to and upon the terms and
conditions set forth herein.

Agreement

NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, the parties agree as follows:

1.
DEFINITIONS.

1.1           Defined Terms.  In addition to the terms defined elsewhere in this
Agreement, the following terms have the following meanings:

“Acquisition down-RElT” shall have the meaning set forth in Section 6.5.2(1).

“Act” shall have the meaning set forth in Section 10.17.

“Administrative Agent” means PNC Bank, National Association, in its capacity as
administrative agent for the Lenders hereunder and under the other Loan
Documents, and any successor administrative agent designated under Section 9.6.

“Administrative Agent’s Office” means Administrative Agent’s address and, as
appropriate, account as set forth on Schedule 1.2, or such other address or
account as Administrative Agent may from time to time notify Borrower and the
Lenders in writing.

“Administrative Questionnaire” means an Administrative Questionnaire in a form
supplied by Administrative Agent.

“Affiliate” means, with respect to a specified Person, any other Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the specified Person.  “Control”
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise.  “Controlling” and
“Controlled” have meanings correlative thereto.

 

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“Agent’s Payment Office” means the address for payments set forth herein for
Administrative Agent, as specified in Schedule 1.2, or such other address as
Administrative Agent may from time to time specify by the delivery of a written
notice to Borrower and the Lenders.

“Agreement” means this Revolving Credit Agreement, as supplemented, modified,
amended or amended and restated from time to time.

“Applicable Margin” means the Applicable LIBOR Margin or the Applicable
Reference Rate Margin determined from the following pricing grid based on the
current published or private ratings of Guarantor’s senior unsecured long term
debt, as provided below:
 
TIER
GUARANTOR’S SENIOR UNSECURED LONG TERM DEBT RATING
APPLICABLE LIBOR  MARGIN (BPS)
FACILITY FEE (BPS PER ANNUM)
APPLICABLE REFERENCE RATE MARGIN (BPS)
I
BBB+ and/or Baal or better
250
25
150
II
BBB and/or Baa2
275
25
175
III
BBB- and/or Baa3
300
25
200
IV
Less than BBB- and/or Baa3
325
25
225

Borrower shall provide to Administrative Agent annually, on or before June 30,
written evidence of the current rating or ratings on Guarantor’s senior
unsecured long term debt by any of Moody’s, S&P and/or Fitch, if such rating
agency has provided to Guarantor a rating on such senior unsecured long term
debt, which evidence shall be reasonably acceptable to Administrative Agent;
provided, that, at a minimum, Guarantor must provide such a rating from either
Moody’s or S&P.  In the event that Guarantor has a rating on its senior
unsecured long term debt provided by (a) both Moody’s and S&P, (b) both Moody’s
and Fitch, (c) both S&P and Fitch, or (d) each of Moody’s, S&P and Fitch, and
there is a difference in rating between such rating agencies, the Applicable
Margin shall be based on the lower rating.  Changes in the Applicable Margin
shall become effective on the first day following the date on which any of
Moody’s, S&P or Fitch that has provided Guarantor a rating on Guarantor’s senior
unsecured long term debt changes such rating.  On the Closing Date, the
Applicable Margin shall be based on Tier III.

“Applicable LIBOR Margin” means the Applicable Margin for LIBOR Loans.

“Applicable Reference Rate Margin” means the Applicable Margin for Reference
Rate Loans.

“Approved Fund” means any Fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.

“Approved Subordination Agreement” has the meaning set forth in Section 6.14(b).

 
2

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“Arranger” means PNC Capital Markets LLC, in its capacity as sole lead arranger
and sole book runner.

“Assignee Group” means two or more Eligible Assignees that are Affiliates of one
another or two or more Approved Funds managed by the same investment advisor.

“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is
required by Section 10.5), and accepted by Administrative Agent, in
substantially the form of Exhibit E or any other form approved by Administrative
Agent.

“Availability” means, at any time, an amount equal to the lesser of (a) 60% of
the Unencumbered Asset Pool Value at such time or (b) the Maximum Commitment
Amount at such time.

“Borrower” has the meaning set forth in the introductory clause hereof.

“Borrower’s Knowledge” means the actual knowledge of the general counsel,
principal financial officer or chief executive officer of the general partner of
Borrower; provided, however, that, if Administrative Agent, L/C Issuer or any
Lender sends a notice with regards to any matter pursuant to the provisions of
Section 10.2 hereof, Borrower shall be deemed to have knowledge of the matters
set forth in such notice as of the date of receipt of such written notice.

“Borrowing” means a Swing Line Borrowing or a borrowing consisting of
simultaneous Loans of the same Type and, in the case of LIBOR Loans, having the
same Interest Period, made by each of the Lenders pursuant to Section 2.1.

“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks in New York, New York, Pittsburgh Pennsylvania and/or the state
where Administrative Agent’s Office is located, are authorized or required by
Law to close and, if the applicable Business Day relates to any LIBOR Loan,
means any such day on which dealings in dollar deposits are conducted by and
between banks in the London interbank eurodollar market.

“Capital Interest” means, with respect to any Joint Venture, the ratio of (i)
Borrower’s contribution to the capital of such Joint Venture to (ii) the
aggregate amount of all contributions to the capital of such Joint Venture.

“Capitalization Rate” means 7.25%.

“Capital Reserve” means $62.50 per unit per quarter for all real properties
owned by Guarantor and its consolidated subsidiaries, excluding, however, units
owned by Acquisition down-REITs.

“Cash Collateralize” has the meaning set forth in Section 2.5.5.  Derivatives of
such term have corresponding meanings.

“Change in Law” means the occurrence, after the date of this Agreement, of any
of the following: (a) the adoption or taking effect of any law, rule, regulation
or treaty by any Governmental Authority, (b) any change in any law, rule,
regulation or treaty or in the administration, interpretation or application
thereof by any Governmental Authority or (c) the making or issuance of any
request, guideline or directive (whether or not having the force of law) by any
Governmental Authority.

 
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“Closing Date” means the earliest date on which all conditions precedent set
forth in Section 5.1 are satisfied or waived in accordance with Section 10.1(a).

“Code” means the Internal Revenue Code of 1986, as amended from time to time,
and any regulations promulgated thereunder.

“Commitment” means, as to each Lender, its obligation to (a) make Loans to
Borrower pursuant to Section 2, (b) purchase participations in L/C Obligations,
and (c) purchase participations in Swing Loans, in an aggregate principal amount
at any one time outstanding not to exceed the amount set forth opposite such
Lender’s name on Schedule 1.1 or in the Assignment and Assumption pursuant to
which such Lender becomes a party hereto, as applicable, as such amount may be
adjusted from time to time in accordance with this Agreement.

“Completion of Construction” means, with respect to any real property, the date
that final certificates of occupancy have been issued for all buildings on such
property.

“Compliance Certificate” shall have the meaning set forth in Section 4.1(b).

“Creditor” has the meaning set forth in Section 6.14(b).

“Daily LIBOR Rate” shall mean, for any day, the rate per annum determined
by  Administrative Agent by dividing (x) the Published Rate by (y) a number
equal to 1.00 minus the LIBOR Reserve Percentage.

“Debt Service” means with respect to any Indebtedness, the sum of (x) the
aggregate interest payments, Letter of Credit Fee and other fees paid or payable
in respect of or relating to such Indebtedness, plus (y) the aggregate principal
installments paid and payable (but not balloon payments due at maturity) in
respect of or relating thereto.

“Default” means any event or circumstance which, with notice or the passage of
time or both, would become an Event of Default.

“Defaulting Lender” means any Lender that (a) has failed to fund any portion of
the Loans, participations in L/C Obligations or participations in Swing Loans
required to be funded by it hereunder within one Business Day of the date
required to be funded by it hereunder, unless such failure has been cured, (b)
has otherwise failed to pay over to Administrative Agent or any other Lender any
other amount required to be paid by it hereunder within one Business Day of the
date when due, unless the subject of a good faith dispute or such failure has
been cured, or (c) has been deemed insolvent or become the subject of a
bankruptcy or insolvency proceeding.

“Defaulting Lender Amount” has the meaning given to it in Section 2.16.1.

 
4

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“Defaulting Lender Notice” has the meaning given to it in Section 2.16.1.

“Default Rate” means the per annum rate of interest that is 400 basis points in
excess of the rate otherwise applicable.

“Designated Borrower’s Account” has the meaning given to it in Section 9.4.

“Dollar” and “$” mean lawful money of the United States.

“EBITDA” means, for any fiscal period of Guarantor and its consolidated
subsidiaries, (a) the sum for such period of (i) consolidated net income, (ii)
consolidated interest expense (including capitalized interest expense); (iii)
consolidated charges against income for all federal, state and local taxes based
on income, (iv) consolidated depreciation expense, (v) consolidated amortization
expense, (vi) the aggregate amount of other non-cash charges and expenses, and
(vii) the aggregate amount of extraordinary losses included in the determination
of consolidated net income for such period, less (b) the aggregate amount of
extraordinary gains included in the determination of consolidated net income for
such period, and in each case excluding all Non-Borrower Interests, all as
determined in accordance with GAAP, consistently applied.  For purposes of this
definition, EBITDA includes Borrower’s pro rata shares of interest expense,
federal, state and local taxes based on income, depreciation expense and
amortization expense for Joint Ventures, based on its Capital Interests in such
Joint Ventures.

“Electing Lender” has the meaning given to it in Section 2.16.1.

“Election Notice” has the meaning given to it in Section 2.16.1.

“Election Period” shall have the meaning set forth in Section 2.16.1.

“Eligible Assignee” means (a) a Lender; (b) an Affiliate of a Lender; (c) an
Approved Fund; (d) an Eligible Lender, and (e) any other Person (other than a
natural person) approved by (i) Administrative Agent in its reasonable
discretion, and (ii) unless an Event of Default has occurred and is continuing,
Borrower (each such approval by Borrower not to be unreasonably withheld or
delayed); provided, however, that notwithstanding the foregoing, “Eligible
Assignee” shall not include Borrower or any of Borrower’s Affiliates or
subsidiaries.  Approval by Administrative Agent or, if required, by Borrower of
any Person as an Eligible Assignee shall not constitute a waiver of any right to
approve any other Person before such other Person can become an Eligible
Assignee.

“Eligible Lender” means any Person, other than Borrower or any Affiliates or
subsidiaries of Borrower who (i) is rated BBB or better by S&P or Baa2 or better
by Moody’s or is a commercial bank, financial institution, institutional lender
with total assets of at least $5,000,000,000, and (ii) is regularly engaged in
the business of commercial real estate lending and maintains one or more lending
offices in the United States.

“EMC” means Essex Management Corporation, a California corporation.

“Engagement Letter” has the meaning given to it in Section 2.11.3.

 
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“Environmental Laws” means all federal, state, and local laws, ordinances,
rules, judgments, orders, decrees, permits, concessions, grants, franchises,
licenses, agreements, governmental restrictions and regulations relating to
pollution and the protection of the environment or the release of any Hazardous
Substances into the environment, including the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. § 9601
et seq., the Hazardous Materials Transportation Act, 49 U.S.C. § 1802, et seq.,
the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq., the Toxic
Substance Control Act of 1976, as amended, 15 U.S.C. § 2601 et seq., the Clean
Water Act, 33 U.S.C. § 466 et seq., as amended, and the Clean Air Act, 42 U.S.C.
§ 7401 et seq.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

“ERISA Affiliate” means any trade or business (whether or not incorporated)
under common control with Borrower within the meaning of Section 414(b) or (c)
of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions
relating to Section 412 of the Code).

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by Borrower or any ERISA Affiliate from a Pension Plan subject to
Section 4063 of ERISA during a plan year in which it was a substantial employer
(as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is
treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or
partial withdrawal by Borrower or any ERISA Affiliate from a Multiemployer Plan
or notification that a Multiemployer Plan is in reorganization; (d) the filing
of a notice of intent to terminate, the treatment of a Plan amendment as a
termination under Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e)
an event or condition which constitutes grounds under Section 4042 of ERISA for
the termination of, or the appointment of a trustee to administer, any Pension
Plan or Multiemployer Plan; or (f) the imposition of any liability under Title
IV of ERISA, other than for PBGC premiums due but not delinquent under Section
4007 of ERISA, upon Borrower or any ERISA Affiliate.

“Event of Default” means any of the events or circumstances specified in Section
8.1.

“Excluded Taxes” means, with respect to Administrative Agent, any Lender, the
L/C Issuer or any other recipient of any payment to be made by or on account of
any obligation of Borrower hereunder, (a) taxes imposed on or measured by its
overall net income (however denominated), and franchise taxes imposed on it,
under the laws of any Governmental Authority, (b) any branch profits taxes
imposed by the United States or any similar tax imposed by any Governmental
Authority, and (c) in the case of a Foreign Lender, any withholding tax that is
imposed on amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party hereto (or designates a new Lending Office) or is
attributable to such Foreign Lender’s failure or inability (other than as a
result of a Change in Law) to comply with Section 3.1.5, except to the extent
that such Foreign Lender (or its assignor, if any) was entitled, at the time of
designation of a new Lending Office (or assignment), to receive additional
amounts from Borrower with respect to such withholding tax pursuant to Section
3.1.5.

 
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“Extended Maturity Date” means the date that immediately follows the expiration
of the First Extension Period or the Second Extension Period, as the case may
be, if the extension option for the First Extension Period or the Second
Extension Period, as the case may be, is duly  exercised by Borrower hereunder.

“Extension Period” shall mean the First Extension Period or the Second Extension
Period, as the case may be.

“Facility Fee” has the meaning given to it in Section 2.11.1.

“Federal Funds Open Rate” shall mean, for any day, the rate per annum (based on
a year of 360 days and actual days elapsed) which is the daily federal funds
open rate as quoted by ICAP North America, Inc. (or any  successor) as set forth
on the Bloomberg Screen BTMM for that day opposite the caption “OPEN” (or on
such other substitute Bloomberg Screen that displays such rate), or as set forth
on such other recognized electronic source used for the purpose of displaying
such rate as selected by Administrative Agent (an “Alternate Source”) (or if
such rate for such day does not appear on the Bloomberg Screen BTMM (or any
substitute screen) or on any Alternate Source, or if there shall at any time,
for any reason, no longer exist a Bloomberg Screen BTMM (or any substitute
screen) or any Alternate Source, a comparable replacement rate determined by
Administrative Agent at such time (which determination shall be conclusive
absent manifest error); provided however, that if such day is not a Business
Day, the Federal Funds Open Rate for such day shall be the “open” rate on the
immediately preceding Business Day.  The rate of interest charged shall be
adjusted as of each Business Day based on changes in the Federal Funds Open Rate
without notice to Borrower.

“Federal Funds Rate” means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding Business
Day, and (b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) charged to PNC Bank on
such day on such transactions, as determined by Administrative Agent.

“First Extension Period” shall mean the consecutive twelve (12) month period
immediately following the Original Maturity Date, as set forth in Section 2.9
hereof.

“Fitch” means Fitch, Inc.

“Fixed Charges” means, for any fiscal period of Guarantor and its consolidated
subsidiaries, the sum of the following items for such period (including
Borrower’s share of each such item for each Joint Venture based on its Capital
Interest in such Joint Venture): (i) interest expense (whether paid or accrued),
other than interest expense on Permitted Affiliate Subordinated Indebtedness,
(ii) capitalized interest expense, other than capitalized interest expense with
respect to Permitted Affiliate Subordinated Indebtedness, (iii) preferred stock
dividends, (iv) scheduled principal payments on Indebtedness, other than balloon
payments and other than payments in respect to Permitted Affiliate Subordinated
Indebtedness, and (v) a reserve for recurring capital expenditures in an amount
equal to the Capital Reserve for such period.

 
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“Foreign Lender” means any Lender that is organized under the laws of a
jurisdiction other than that in which Borrower is resident for tax
purposes.  For purposes of this definition, the United States, each State
thereof and the District of Columbia shall be deemed to constitute a single
jurisdiction.  As an example, if Borrower is a resident of the United States for
tax purposes, a “Foreign Lender” will be any Lender that is organized under the
laws of any country, other than the United States.

“Fronting Fee” has the meaning set forth in Section 2.11.2.

“Fund” means any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.

“Funds From Operations” means, with respect to Guarantor and its consolidated
subsidiaries, net income calculated in conformity with the National Association
of Real Estate Investment Trusts in its White Paper on Funds From Operations, as
published from time to time.

“GAAP” means generally accepted accounting principles set forth from time to
time in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants, and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination, consistently applied.

“Governmental Authority” means the government of the United States or any other
nation, or of any political subdivision thereof, whether state or local, and any
agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including any
supra-national bodies such as the European Union or the European Central Bank).

“Gross Asset Value” means, at any time, the sum (without duplication) of (i) an
amount equal to EBITDA for Guarantor and its consolidated subsidiaries for the
most recent four (4) consecutive fiscal quarters for which Administrative Agent
has received financial statements (the “Measuring Period”) (excluding any income
attributable to properties bought or sold during such Measuring Period and any
income received during such Measuring Period attributable to the Clarewood
Office Building located at 22110-22120 Clarendon Street, Woodland Hills,
California, and the office buildings located at 925 and 935 East Meadow Drive,
Palo Alto, California), (4) and divided by the Capitalization Rate (expressed as
a decimal); (ii) the amount of cash and marketable securities held by Guarantor
and its consolidated subsidiaries as of the end of such Measuring Period; (iii)
the aggregate acquisition cost of properties acquired by Guarantor or any of its
consolidated subsidiaries during such Measuring Period (including Borrower’s pro
rata shares of any properties acquired by Joint Ventures, based on its Capital
Interests in such Joint Ventures); (iv) the aggregate book value of all
development property as of the end of such Measuring Period (including
Borrower’s pro rata share of development property held by Joint Ventures, based
on its Capital Interests in such Joint Ventures), as reported on Guarantor’s 10K
and 10Q; (v) $4,500,000, if Borrower owns the Clarewood Office Building located
at 22110-22120 Clarendon Street, Woodland Hills, California at such time; and
(vi) $9,000,000, if Borrower owns the office buildings located at 925 and 935
East Meadow Drive, Palo Alto, California at such time.

 
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“Guarantor” means Essex Property Trust, Inc., a Maryland corporation operating
as a real estate investment trust.

“Guaranty” means that certain Payment Guaranty of even date herewith, executed
by Guarantor and substantially in the form of Exhibit F-l attached hereto.

“Guaranty Obligation” means, as applied to any Person, any direct or indirect
liability of that Person with respect to any Indebtedness, lease, dividend,
letter of credit or other obligation (the “primary obligations”) of another
Person.  The amount of any Guaranty Obligation shall be deemed equal to the
stated or determinable amount of the primary obligation in respect of which such
Guaranty Obligation is made or, if not stated or if indeterminable, the maximum
reasonably anticipated liability in respect thereof.

“Hazardous Substance” means any substance, material or waste, including asbestos
and petroleum (including crude oil or any fraction thereof), polychlorinated
biphenyls, radon gas, urea formaldehyde foam insulation, explosive or
radioactive material, or infectious or medical wastes, which is or becomes
designated, classified or regulated as “toxic,” “hazardous,” a “pollutant” or
similar designation under, or which is regulated pursuant to, any Environmental
Law.

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

“Indebtedness” of any Person means, without duplication, (a) all indebtedness
for borrowed money; (b) all obligations issued, undertaken or assumed as the
deferred purchase price of property or services; (c) all reimbursement
obligations with respect to surety bonds, letters of credit and similar
instruments; (d) all obligations evidenced by notes, bonds, debentures or
similar instruments, including obligations so evidenced incurred in connection
with the acquisition of property, assets or businesses; (e) all indebtedness
created or arising under any conditional sale or other title retention
agreement, or incurred as financing, in either case with respect to property
acquired by the Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession
or sale of such property); (f) all indebtedness referred to in clauses (a)
through (e) above secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any Lien upon or
in property owned by such Person, even though such Person has not assumed or
become liable for the payment of such Indebtedness; and (g) all Guaranty
Obligations in respect of indebtedness or obligations of others of the kinds
referred to in clauses (a) through (e) above.

 
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“Indemnified Taxes” means Taxes other than Excluded Taxes.

“Indemnitee” has the meaning set forth in Section 10.4(b).

“Information” has the meaning set forth in Section 10.6.

“Insolvency Proceeding” means (a) any case, action or proceeding before any
court or other Governmental Authority relating to bankruptcy, reorganization,
insolvency, liquidation, receivership, dissolution, winding-up or relief of
debtors, or (b) any general assignment for the benefit of creditors,
composition, marshaling of assets for creditors or other similar arrangement in
respect of its creditors generally or any substantial portion of its creditors;
in each case (a) and (b) undertaken under U.S. federal, state or foreign law,
including the United States Bankruptcy Code (11 U.S.C. §101 et seq.).

“Interest Payment Date” means (a) for each Reference Rate Loan, the first day of
each calendar quarter (beginning on January 1, 2010) during the term of this
Agreement, (b) for each LIBOR Loan, the last day of the applicable Interest
Period, but not less often than every three (3) months, (c) the Maturity Date,
and (d) the date of any prepayment of any Loan made hereunder, as to the amount
prepaid.

“Interest Period” means with respect to any LIBOR Loan, the period commencing on
the Business Day the Loan is disbursed or continued or on the conversion date on
which the Loan is converted to a LIBOR Loan and ending on the date that is one,
two, three or six months thereafter, as selected by Borrower in its Notice of
Borrowing or Conversion/Continuation; provided that:

(a)           if any Interest Period pertaining to a LIBOR Loan would otherwise
end on a day that is not a Business Day, that Interest Period shall be extended
to the next succeeding Business Day unless the result of such extension would be
to carry such Interest Period into another calendar month, in which event such
Interest Period shall end on the immediately preceding Business Day; and

(b)           any Interest Period pertaining to a LIBOR Loan that begins on the
last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the end of
such Interest Period; and

(c)           no Interest Period shall extend beyond the Maturity Date.

“ISP” means, with respect to any Letter of Credit, the “International Standby
Practices 1998” published by the Institute of International Banking Law &
Practice (or such later version thereof as may be in effect at the time of
issuance).

“Issuer Documents” means with respect to any Letter of Credit, the Letter of
Credit Application, and any other document, agreement and instrument entered
into by the L/C Issuer and Borrower (or any subsidiary, Joint Venture or
Permitted Affiliate) or in favor the L/C Issuer and relating to any such Letter
of Credit.

 
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“Joint Venture” means a Person in which Borrower has an ownership interest that
is less than 100%.

“Joint Venture Investments” means the aggregate amount of Borrower’s investments
(valued in accordance with GAAP), advances and loans to Joint Ventures
unconsolidated under GAAP, excluding investments in such Joint Ventures in which
Borrower’s Capital Interest is less than 15%.

“Laws” means, collectively, all international, foreign, Federal, state and local
statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.

“L/C Advance” means, with respect to each Lender, such Lender’s funding of its
participation in any L/C Borrowing in accordance with its Pro Rata Share.

“L/C Borrowing” means an extension of credit resulting from a drawing under any
Letter of Credit which has not been reimbursed on the date when made or
refinanced as a Borrowing.

“L/C Issuer” means PNC Bank in its capacity as issuer of Letters of Credit
hereunder, or any successor issuer of Letters of Credit hereunder.

“L/C Obligations” means, as at any date of determination, the aggregate undrawn
amount of all outstanding Letters of Credit plus the aggregate of all
Unreimbursed Amounts.  For purposes of computing the amount available to be
drawn under any Letter of Credit, the amount of such Letter of Credit shall be
determined in accordance with Section 1.2.4.  For all purposes of this
Agreement, if on any date of determination a Letter of Credit has expired by its
terms but any amount may still be drawn thereunder by reason of the operation of
Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding”
in the amount so remaining available to be drawn.

“Lender Reply Period” has the meaning given to it in Section 10.2(f).

“Lenders” means PNC Bank and the several additional financial institutions from
time to time a party to this Agreement.

“Lending Office” means, as to any Lender, the office or offices of such Lender
described as such in the Administrative Questionnaire for such Lender, or such
other office as such Lender may designate to Borrower and Administrative Agent
in writing from time to time.

“Letter of Credit” means a standby letter of credit issued by PNC Bank for
Borrower’s account pursuant to Section 2.1.

“Letter of Credit Application” means an application and agreement for the
issuance or amendment of a Letter of Credit in the form from time to time in use
by the L/C Issuer.

 
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“Letter of Credit Fee” has the meaning set forth in Section 2.11.2.

“Letter of Credit Sublimit” means, at any time, the lesser of (a) $20,000,000 or
(b) the difference between (i) the Availability at such time and (ii) the sum of
the aggregate Outstanding Amount of all Loans and Swing Loans and the
Outstanding Amount of all L/C Obligations at such time.

“LIBOR Base Rate” means, for any Interest Period with respect to any LIBOR Loan,
the rate per annum equal to the rate per annum which appears on the Bloomberg
Page BBAM1 (or on a substitute Bloomberg page that displays rates at which
Dollar deposits are offered by leading banks in the London interbank deposit
market), at approximately 11:00 a.m., London time, two (2) Business Days prior
to the commencement of such Interest Period, for Dollar deposits (for delivery
on the first day of such Interest Period) with a term equivalent to such
Interest Period.  If such rate is not available at such time for any reason,
then the “LIBOR Base Rate” for such Interest Period shall be the rate per annum
determined by Administrative Agent to be the rate at which deposits in Dollars
for delivery on the first day of such Interest Period in same day funds in the
approximate amount of the LIBOR Loan being made, continued or converted by
Administrative Agent and with a term equivalent to such Interest Period as would
be offered by a source selected by Administrative Agent which has been approved
by the British Bankers’ Association as an authorized information vendor for the
purpose of displaying rates at which Dollar deposits are offered by leading
banks in the London interbank deposit market at their request at approximately
11:00 a.m. (London time) two (2) Business Days prior to the commencement of such
Interest Period.

“LIBOR Borrowing” means a Borrowing consisting of LIBOR Loans.

“LIBOR Loan” means a Loan that bears interest at a rate based upon the LIBOR
Rate.

“LIBOR Rate” means, the interest rate per annum (rounded upward, if necessary,
to a whole multiple of 1/100 of 1%) determined by Administrative Agent by
dividing (i) the LIBOR Base Rate by (ii) a number equal to 1.00 minus the LIBOR
Reserve Percentage.  The LIBOR Rate may also be expressed by the following
formula:

LIBOR Rate =
LIBOR Base Rate
 
1.00 – LIBOR Reserve Percentage

“LIBOR Reserve Percentage” means, for any day during any Interest Period, the
reserve percentage (expressed as a decimal, carried out to five decimal places)
in effect on such day, whether or not applicable to any Lender, under
regulations issued from time to time by the FRB for determining the maximum
reserve requirement (including any emergency, supplemental or other marginal
reserve requirement) with respect to eurocurrency funding (currently referred to
as “eurocurrency liabilities”).  The LIBOR Rate for the purposes of each
outstanding LIBOR Loan, and the Daily LIBOR Rate for the purposes of each
Reference Rate Loan, shall be adjusted automatically as of the effective date of
any change in the LIBOR Reserve Percentage.

“Lien” means any mortgage, deed of trust, pledge, hypothecation, assignment,
charge or deposit arrangement, encumbrance, lien (statutory or other) or
preference, priority or other security interest or preferential arrangement of
any kind or nature whatsoever (including those created by, arising under or
evidenced by any conditional sale or other title retention agreement, the
lessor’s interest under a capital lease (determined in accordance with GAAP),
any financing lease having substantially the same economic effect as any of the
foregoing, or the filing of any financing statement under the UCC or any
comparable law naming the owner of the asset to which such lien relates as
debtor) and any contingent or other agreement to provide any of the foregoing,
but not including the interest of a lessor under an operating lease (determined
in accordance with GAAP).

 
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“Loan(s)” has the meaning set forth in Section 2.1(a)(i).

“Loan Documents” means this Agreement, the Notes, the Guaranty, each Payment
Guaranty, each Issuer Document and any other documents delivered to
Administrative Agent, on behalf of the Lenders, in connection therewith, in each
case as supplemented, modified, amended or amended and restated from time to
time.

“Maturity Date” means the earlier of the following dates:  (a) the Original
Maturity Date or, if Borrower has exercised its extension option(s) pursuant to
and in accordance with Section 2.9 hereof, the applicable Extended Maturity
Date, or (b) any earlier date on which all of the Loans shall become due,
whether by acceleration, mandatory prepayment or otherwise., provided, however,
that if such date is not a Business Day, the Maturity Date shall be the next
preceding Business Day.

“Maximum Commitment Amount” means, at any time, an amount equal to $200,000,000
subject to decrease pursuant to the provisions of Section 2.7.

“Moody’s” means Moody’s Investors Service, Inc.

“Multiemployer Plan” means any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, to which Borrower or any ERISA Affiliate makes or
is obligated to make contributions, or during the preceding five plan years, has
made or been obligated to make contributions.

“Net Operating Income” for a property means, for the relevant period, the
aggregate total cash revenues actually collected from the normal operation of
such property (excluding all security deposits until such time as the tenant or
other user making such deposit is no longer entitled to return thereof), plus
amounts payable to unrelated third parties on behalf of the owner of the
property, if actually paid, plus the proceeds of any rental or business
interruption insurance actually received by the owner of the property with
respect to such property, from which there shall be deducted all costs and
expenses paid or payable by the owner and relating to such property (other than
Debt Service which is paid and balloon payments), including (a) any charges paid
in connection with the use, ownership or operation of such property, (b) any
cost of repairs and maintenance, (c) any cost associated with the management of
such property, (d) any payroll cost and other expenses for general
administration and overhead paid in connection with the use, ownership or
operation of such property, (e) current real estate taxes, (f) any sums paid or
subject to payment in the nature of a rebate, refund or other adjustment to
revenue previously collected, (g) all assessment bond indebtedness (whether
principal or interest) in respect of such property paid or payable for the
interval in question, (h) all amounts paid to unrelated third parties on behalf
of the owner of the property, and (i) any and all costs or expenses, of whatever
nature or kind, incurred in connection with the use, ownership or operation of
the property; provided, however, that such costs and expenses paid or payable by
Borrower and relating to such property shall not include tenant improvement
costs, leasing commissions or the costs and expenses of capital improvements and
capital repairs, or depreciation, amortization or other non-cash expenses.

 
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“Nominated Property” has the meaning given to it in Section 4.1(a).

“Non-Borrower Interests” means (a) the portion of capital contributed to
Borrower or any Joint Venture by a Person other than Borrower or Guarantor; and
(b) the portion of income of Borrower or any Joint Venture that is allocated to
a Person other than Borrower or Guarantor.

“Non-Recourse Indebtedness” means, with respect to any Person, Indebtedness of
that Person with respect to which recourse to such Person for payment is
contractually limited to specific assets encumbered by a Lien securing such
Indebtedness.  Notwithstanding the foregoing, Indebtedness of any Person shall
not fail to constitute Non-Recourse Indebtedness by reason of the inclusion in
any document evidencing, governing, securing or otherwise relating to such
Indebtedness to the effect that such Person shall be liable, beyond the assets
securing such Indebtedness, for (a) misapplied moneys, including insurance and
condemnation proceeds and security deposits, (b) liabilities (including
environmental liabilities) of the holders of such Indebtedness and their
affiliates to third parties, (c) breaches of customary representations and
warranties given to the holders of such Indebtedness, (d) commission of waste
with respect to any part of the collateral securing such Indebtedness, (e)
recovery of rents, profits or other income attributable to the collateral
securing such Indebtedness collected following a default, (f) fraud, gross
negligence or willful misconduct, (g) breach of any covenants regarding
compliance with ERISA, and (h) other similar exceptions to the non-recourse
nature of the Indebtedness imposed by an institutional lender.

“Notes” means, collectively, the Revolving Notes and the Swing Line Note.

“Notice of Borrowing or Conversion/Continuation” means a notice substantially in
the form of Exhibit B given by Borrower to Administrative Agent pursuant to
Section 2.3, 2.5 or Section 2.6, as applicable, which shall include, in the case
of a request for a Letter of Credit, a Letter of Credit Application.

“O&M Plan” means an operations and maintenance plan relating to any asbestos
containing materials.

“Obligations” means all Loans, Swing Loans, L/C Borrowings, advances, debts,
liabilities, obligations and covenants owing from Borrower, Guarantor or any
Permitted Affiliate to any Lender, Administrative Agent or any Indemnitee under
any Loan Document, whether absolute or contingent, due or to become due, now
existing or hereafter arising ,and including interest and fees that accrue after
the commencement by or against Borrower, Guarantor or any Permitted Affiliate of
any proceeding under any Insolvency Proceeding naming such Person as the debtor
in such proceeding, regardless of whether such interest and fees are allowed
claims in such proceeding.

 
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“Obligor” has the meaning set forth in Section 6.14(b).

“Original Maturity Date” shall mean the date that is twelve (12) months from the
Closing Date.

“Other Taxes” means all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any
payment made hereunder or under any other Loan Document or from the execution,
delivery or enforcement of, or otherwise with respect to, this Agreement or any
other Loan Document.  Other Taxes shall not include any Excluded Taxes.

“Outstanding Amount” means(s) (a) with respect to Loans and Swing Loans on any
date, the aggregate outstanding principal amount thereof after giving effect to
any borrowings and prepayments or repayments of Loans occurring on such date;
and (b) with respect to any L/C Obligations on any date, the amount of such L/C
Obligations on such date after giving effect to the issuance, extension or
increase of any Letter of Credit occurring on such date and any other changes in
the aggregate amount of the L/C Obligations as of such date, including as a
result of any reimbursements of outstanding unpaid drawings under any Letters of
Credit or any reductions in the maximum amount available for drawing under
Letters of Credit taking effect on such date.

“Participant” shall have the meaning set forth in Section 10.5(d).

“Payment Guaranty” means a guaranty by a Permitted Affiliate of the Obligations
of Borrower under this Agreement in favor of Administrative Agent, as
administrative agent for the Lenders, substantially in the form of Exhibit F-2
hereto.

“PBGC” means the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA or any entity succeeding to any or all of its
functions under ERISA.

“Pension Plan” means any “employee pension benefit plan” (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by Borrower or any
ERISA Affiliate or to which Borrower or any ERISA Affiliate contributes or has
an obligation to contribute, or in the case of a multiple employer or other plan
described in Section 4064(a) of ERISA, has made contributions at any time during
the immediately preceding five plan years.

“Permitted Affiliate” means each direct or indirect wholly-owned subsidiary of
Borrower or Guarantor that owns an Unencumbered Asset Pool Property (or holds
the interest in such Unencumbered Asset Pool Property as is described in Section
4.1(a)(i)(1) and is or becomes a party to a Payment Guaranty, including, on the
Closing Date, each entity that is listed on Schedule 1.3 hereto.  Upon removal
of the Unencumbered Asset Pool Property owned by such subsidiary from the
Unencumbered Asset Pool pursuant to Section 4.1(b) or Section 4.1(c), and as
long as such subsidiary no longer owns (or holds any interest as is described in
Section 4.1(a)(i)(l) in) any Unencumbered Asset Pool Property included in the
calculation of Availability, such subsidiary shall no longer constitute a
Permitted Affiliate hereunder.

 
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“Permitted Affiliate Subordinated Indebtedness” means Indebtedness owing by an
Obligor that is Borrower, Guarantor or a Permitted Affiliate, to a Creditor that
is Borrower, Guarantor, a Permitted Affiliate or an Affiliate that is a
consolidated subsidiary of Guarantor, provided that such Creditor has executed
an Approved Subordination Agreement.

“Permitted Liens” has the meaning given to it in Section 4.1(a)(i)(5).

“Person” means an individual, corporation, partnership, joint venture, limited
liability company, joint stock company, business trust, unincorporated
association or Governmental Authority.

“Plan” means any “employee benefit plan” (as such term is defined in Section
3(3) of ERISA) established by Borrower or, with respect to any such plan that is
subject to Section 412 of the Code or Title IV of ERISA, any ERISA Affiliate.

“Platform” has the meaning given to it in Section 6.3.

“PNC Bank” means PNC Bank, National Association.

“Prime Rate” means the rate of interest in effect for such day as publicly
announced from time to time by PNC Bank as its “prime rate.” The Prime Rate is
determined from time to time by PNC Bank as a means of pricing some loans to its
borrowers.  The Prime Rate is not tied to any external rate of interest or
index, and does not necessarily reflect the lowest rate of interest actually
charged by PNC Bank to any particular class or category of customers.  If and
when the Prime Rate changes, the rate of interest with respect to any obligation
to which the Prime Rate applies will change automatically without notice to
Borrower, effective on the date of any such change.

“Pro Rata Share” means, as to any Lender at any time, the percentage indicated
for such Lender as its “Pro Rata Share” on Schedule 1.1 (expressed as a decimal
rounded to the ninth decimal place), as such percentage may be adjusted from
time to time to account for any assignments of a Lender’s interest as provided
in Section 10.5.

“Published Rate” means the rate of interest published each Business Day in The
Wall Street Journal “Money Rates” listing under the caption “London Interbank
Offered Rates” for a one month period (or, if no such rate is published therein
for any reason, then the Published Rate shall be the eurodollar rate for a one
month period as published in another publication determined by Administrative
Agent).

“Reference Rate” means for any day a fluctuating rate per annum equal to the
highest of (a) the Federal Funds Open Rate plus one-half of one percent (.5%),
(b) the Prime Rate and (c) the Daily LIBOR Rate plus one percent (1%).

“Reference Rate Borrowing” means a Borrowing consisting of Reference Rate Loans.

“Reference Rate Loan” means a Loan that bears interest based on the Reference
Rate.

“Register” shall have the meaning set forth in Section 10.5(c).

 
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“Related Parties” means, with respect to any Person, such Person’s Affiliates
and the partners, directors, officers, employees, agents and advisors of such
Person and of such Person’s Affiliates.

“Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the 30 day notice period has been waived.

“Responsible Officer” means any officer of the general partner of Borrower
having the authority to execute Loan Documents, Notices of Borrowing or
Conversion/Continuation on behalf of Borrower, as identified to Administrative
Agent in a certificate executed by the General Counsel, Principal Financial
Officer, Chief Executive Officer, Vice President-Finance or Secretary of
Borrower’s general partner.

“Required Lenders” means, as of any date of determination, the Lenders having at
least 66-2/3% of the Commitments or, if the commitment of each Lender to make
Loans and the obligation of the L/C Issuer to issue Letters of Credit have been
terminated pursuant to Section 8.2, the Lenders holding in the aggregate at
least 66-2/3% of the Outstanding Amount of all Loans plus the Outstanding Amount
of all L/C Obligations (with the aggregate amount of each Lender’s risk
participation and funded participation in L/C Obligations and Swing Loans being
deemed “held” by such Lender for purposes of this definition); provided that the
Commitment of, and the portion of the Outstanding Amount held or deemed held by,
any Defaulting Lender shall be excluded for purposes of making a determination
of Required Lenders; and provided further that if there are fewer than three
Lenders, all Lenders shall be Required Lenders.

“Requirements of Law” means, as to any Person, any law (statutory or common),
treaty, rule or regulation, or any determination of an arbitrator or of a
Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is
subject.

“Requirements” shall have the meaning set forth in Section 6.1.1.

“Revolving Note(s)” means each promissory note of Borrower payable to the order
of a Lender, substantially in the form of Exhibit G-l hereto, and any
amendments, supplements, modifications, renewals, replacements, consolidations
or extensions thereof, evidencing the aggregate indebtedness of Borrower to a
Lender resulting from Loans made by such Lender pursuant to this Agreement;
“Revolving Notes” means, at any time, all of the Notes (other than the Swing
Line Note) executed by Borrower in favor of a Lender outstanding at such time.

“Second Extension Period” means the consecutive twelve (12) month period
immediately following the expiration of the First Extension Period, as more
fully set forth in Section 2.9 hereof.

“Secured Debt” means Indebtedness that is secured by a Lien encumbering real
property owned or leased by the obligor.  Notwithstanding the foregoing, Secured
Debt shall not include any Permitted Affiliate Subordinated Indebtedness.

“Secured Recourse Debt” means all Secured Debt that is not Non-Recourse Debt.

 
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“S&P” means Standard & Poor’s Rating Services, a division of The McGraw-Hill
Companies, Inc.

“Swing Line” has the meaning given to it in Section 2.2.1.

“Swing Line Availability” means, at any time, the lesser of (a) $20,000,000, or
(b) the difference between (i) the Availability at such time and (ii) the sum of
the aggregate Outstanding Amount of all Loans and Swing Loans and the
Outstanding Amount of all L/C Obligations outstanding at such time.

“Swing Line Borrowing” means a borrowing of a Swing Loan pursuant to Section
2.2.

“Swing Line Lender” means PNC Bank, in its capacity as the maker of Swing Loans
under Section 2.2, or any successor or replacement thereto under Sections 9.6 or
10.5(h).

“Swing Line Note” means the promissory note of Borrower payable to the order of
the Swing Line Lender, substantially in the form of Exhibit G-2 attached hereto,
to evidence the Swing Loans, and any amendments, supplements, modifications,
renewals, replacements, consolidations or extensions thereof.

“Swing Loan” and “Swing Loans” have the meanings given to them in Section 2.2.1.

“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental
Authority and arising from any payment made hereunder or under any other Loan
Document or from the execution, delivery or enforcement of, or otherwise with
respect to, this Agreement or any other Loan Document, including any interest,
additions to tax or penalties applicable thereto.

“Total Liabilities” means, without duplication, (a) all Indebtedness of
Guarantor and its consolidated subsidiaries, including subordinated debt,
capitalized leases, purchase obligations (defined as nonrefundable deposits and
non-contingent obligations), L/C Obligations and unfunded obligations of
Guarantor, Borrower or any consolidated subsidiary reported in accordance with
GAAP, (b) Borrower’s and Guarantor’s pro rata share of non-recourse liabilities
of unconsolidated Joint Ventures, based on its Capital Interests in such Joint
Ventures; and (c) all liabilities of Affiliates that are recourse to Borrower or
Guarantor.  The term “Total Liabilities” does not include (i) that portion of
Borrower’s liabilities attributable to Non-Borrower Interests; (ii) except as
provided in “(b)” above, the Non-Recourse Indebtedness of an Acquisition
down-REIT; and (iii) any Permitted Affiliate Subordinated Indebtedness.

“Type” means, in connection with a Loan, the characterization of such loan as a
Reference Rate Loan or a LIBOR Loan.

“UCC” means the Uniform Commercial Code as in effect in any jurisdiction, as the
same may be amended, modified or supplemented from time to time.

“Unencumbered Asset Pool” means, at any time, all of the Unencumbered Asset Pool
Properties at such time.

 
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“Unencumbered Asset Pool Property” means each Unencumbered Development Property
and each Unencumbered Stabilized Asset Property.

“Unencumbered Asset Pool Value” means, at any time, an amount equal to the sum
of the Unencumbered Development Property Value plus the Unencumbered Stabilized
Asset Property Value.

“Unencumbered Development Property” means a real property listed Exhibit A-2 and
any additional development property that satisfies all of the conditions set
forth in Section 4.1(a)(ii), as long as either Borrower or a Permitted Affiliate
holds fee simple title to such development property or such development property
is subject to a financeable ground lease (as determined by Administrative Agent
in its reasonable discretion) in compliance with the second sentence of Section
4.1(c) (subject to the exceptions set forth in Section 4.1(a)(i)(1)).  Such
development property shall no longer qualify as an Unencumbered Development
Property on the date that is the earlier of (i) twelve months following the date
on which Completion of Construction on such Unencumbered Development Property
has occurred, or (ii) the first fiscal quarter in which such Unencumbered
Development Property becomes a Unencumbered Stabilized Asset Property.

“Unencumbered Development Property Value” means, at any time, for all
Unencumbered Development Property, the aggregate cost book value determined in
accordance with GAAP (as shown on the Borrower’s consolidated balance sheet).

“Unencumbered Property” means any real property that satisfied the following
conditions:

(a)           such real property is wholly owned by Borrower or any of its
consolidated subsidiaries in fee simple title, or such real property is subject
to a financeable ground lease (as determined by Administrative Agent in its
reasonable discretion) in favor of Borrower or any of its consolidated
subsidiaries, in excess of 30 years (provided that no less than 15 years shall
be remaining on such ground lease) and such real property is located within the
United States);

(b)           Such real property is either (i) operated as residential
apartments, with no more than 20% of gross revenue generated by non-residential
tenants, or (ii) is real property comprised of residential apartment projects
under development, with no more than 20% of such development to be intended for
occupancy by non-residential tenants, or in pre-construction phases of the
development process; provided that such property under development shall not
qualify to be included as a development property under this clause (ii) on the
date that is the earlier of (A) twelve months following the date that Completion
of Construction on such real property has occurred, or (B) the date that such
real property qualified as an operating residential apartment with a minimum
occupancy of 70% pursuant to the foregoing clause (i) of this paragraph (b) and
paragraph (c) below;

(c)           Other than with respect to any real property under development
under clause (ii) of paragraph (b) above, such real property shall have minimum
occupancy of 70%; and

(d)           Such real property is free of all liens, encumbrances and negative
pledges, except for: (i) liens for taxes, assessments or governmental charges or
levies to the extent that the owner of such real property is not yet required to
pay the amount secured thereby; and (ii) liens imposed by law, such as
carrier’s, warehouseman’s, mechanic’s, materialman’s and other similar liens,
arising in the ordinary course of business in respect of obligations that are
not overdue or are being actively contested in good faith by appropriate
proceedings, as long as the owner of such real property, as applicable, has
established and maintained adequate reserves for the payment of the same and, by
reason of nonpayment, such real property is not in danger of being lost or
forfeited; and (iii) easements; covenants, conditions and restrictions;
reciprocal easement and access agreements and similar agreements relating to
ownership and operation.

 
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“Unencumbered Stabilized Asset Property” means a real property listed Exhibit
A-l and any additional real property that satisfies the conditions set forth in
Section 4.1(a)(i), in each case as long as either Borrower or a Permitted
Affiliate holds fee simple title to such real property or such real property is
subject to a financeable ground lease (as determined by Administrative Agent in
its reasonable discretion) in compliance with the second sentence of Section
4.1(c), subject to the exceptions set forth in Section 4.1(a)(i)(l) hereof.

“Unencumbered Stabilized Asset Property Value” means, at any time, the aggregate
of the values determined for each Unencumbered Asset Property as follows:

(a)           if at such time Borrower or a Permitted Affiliate has owned such
Unencumbered Stabilized Asset Property for four or more full consecutive
calendar quarters (or, with respect to any such real property that was formerly
an Unencumbered Development Property or a development property, if such real
property has qualified as an Unencumbered Stabilized Asset Property for four or
more full consecutive calendar quarters), an amount equal to (A) its Net
Operating Income for the most recent four consecutive quarter period, less the
Capital Reserve for such period, divided by (B) the Capitalization Rate
(expressed as a decimal);

(b)           if at such time Borrower or a Permitted Affiliate has owned such
Unencumbered Stabilized Asset Property for one full calendar quarter or more but
fewer than four full consecutive calendar quarters (or, with respect to any such
real property that was formerly an Unencumbered Development Property or a
development property, if such real property has qualified as an Unencumbered
Stabilized Asset Property for one full calendar quarter or more but fewer than
four full consecutive calendar quarters), an amount equal to (i) its annualized
Net Operating Income for the number of the most recent full consecutive calendar
quarters that Borrower has owned such property (e.g., Net Operating Income for
properties owned for two full consecutive calendar quarters is annualized by
multiplying by a factor of two), less the Capital Reserve for such period,
divided by (ii) the Capitalization Rate (expressed as a decimal); or

(c)           if at such time Borrower or a Permitted Affiliate has owned such
Unencumbered Stabilized Asset Property for less than one full calendar quarter
(or, with respect to any such real property that was formerly an Unencumbered
Development Property or a development property, if such real property has
qualified as an Unencumbered Stabilized Asset Property for less than one full
calendar quarter), an amount equal to its acquisition cost.

“Unfunded Pension Liability” means the excess of a Pension Plan’s benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan’s assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.

 
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“Unreimbursed Amount” has the meaning set forth in Section 2.5.1(a).

“Unsecured Debt” means, at any time, all Indebtedness of Borrower, Guarantor and
any wholly owned subsidiary of Borrower or Guarantor that is not Secured Debt at
the end of Guarantor’s most recent fiscal quarter, including, without
limitation, Indebtedness arising under the Loan Documents.  Notwithstanding the
foregoing, Unsecured Debt shall not include any Permitted Affiliate Subordinated
Indebtedness.

Terms capitalized in this Agreement and not defined in this Section 1 have the
meanings given to them elsewhere in this Agreement.

1.2           Other Interpretive Provisions.

1.2.1        Use of Defined Terms.  Unless otherwise specified herein or
therein, all terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant to
this Agreement.  The meaning of defined terms shall be equally applicable to the
singular and plural forms of the defined terms.

1.2.2        Certain Common Terms.

(1)           The Agreement.  The words “hereof,” “herein,” “hereunder” and
words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement, and
section, schedule and exhibit references are to this Agreement unless otherwise
specified.

(2)           Documents.  The term “documents” includes any and all instruments,
documents, agreements, certificates, indentures, notices and other writings,
however evidenced.

(3)           Meaning of Certain Terms.  The term “including” is not limiting
and means “including without limitation.” The word “will” shall be construed to
have the same meaning and effect as the word “shall.” The words “asset” and
“property” shall be construed to have the same meaning and effect and to refer
to any and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights.

(4)           Performance.  Whenever any performance obligation hereunder
(including a payment obligation) is stated to be due or required to be satisfied
on a day other than a Business Day, such performance shall be made or satisfied
on the next succeeding Business Day.  In the computation of periods of time from
a specified date to a later specified date (other than with respect to
computation of interest owed or accrued under this Agreement), the word “from”
means “from and including” and the words “to” and “until” each mean “to and
including”.  If any provision of this Agreement refers to any action taken or to
be taken by any Person, or which such Person is prohibited from taking, such
provision shall be interpreted to encompass any and all reasonable means, direct
or indirect, of taking or not taking such action.

 
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(5)           Contracts.  Unless otherwise expressly provided in this Agreement,
references to agreements and other contractual instruments shall be deemed to
include all subsequent amendments and other modifications thereto, but only to
the extent such amendments and other modifications are not prohibited by the
terms of any Loan Document.

(6)           Laws.  References to any statute or regulation are to be construed
as including all statutory and regulatory provisions consolidating, amending or
replacing the statute or regulation.

(7)           Captions.  The captions and headings of this Agreement are for
convenience of reference only, and shall not affect the construction of this
Agreement.

(8)           Independence of Provisions.  If a conflict exists between the
terms of this Agreement and those of any other Loan Document, this Agreement
shall prevail; provided, however, that the parties acknowledge that this
Agreement and the other Loan Documents may use several different limitations,
tests or measurements to regulate the same or similar matters, and that such
limitations, tests and measurements are cumulative and must each be performed,
except as expressly stated to the contrary in this Agreement, or unless the
applicable provisions are inconsistent or cannot be simultaneously enforced or
performed.

(9)           Exhibits.  All of the exhibits attached to this Agreement are
incorporated herein by this reference.

(10)         Times of Day.  Unless otherwise specified, all references herein to
times of day shall be references to Eastern time (daylight or standard, as
applicable).

1.2.3        Accounting Principles.

(1)           Accounting Terms.  Unless the context otherwise clearly requires,
all accounting terms not otherwise expressly defined herein shall be construed,
and all financial computations required under this Agreement shall be made, in
accordance with GAAP, consistently applied.

(2)           Fiscal Periods.  References herein to “fiscal year” and “fiscal
quarter” refer to such fiscal periods of Guarantor and its consolidated
subsidiaries.

(3)           Rounding.  Any financial ratios required to be maintained by
Borrower or Guarantor pursuant to this Agreement or any other Loan Document
shall be calculated by dividing the appropriate component by the other
component, carrying the result to one place more than the number of places by
which such ratio is expressed herein and rounding the result up or down to the
nearest number (with a rounding-up if there is no nearest number).

1.2.4        Letter of Credit Amounts.  Unless otherwise specified herein, the
amount of a Letter of Credit at any time shall be deemed to be the stated amount
of such Letter of Credit in effect at such time; provided, however, that with
respect to any Letter of Credit that, by its terms or the terms of any Issuer
Document related thereto, provides for one or more automatic increases in the
stated amount thereof, the amount of such Letter of Credit shall be deemed to be
the maximum stated amount of such Letter of Credit after giving effect to all
such increases, whether or not such maximum stated amount is in effect at such
time.

 
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2.
LOAN AMOUNTS AND TERMS.

2.1           Amount and Terms of Commitment.

(a)           Commitment.  Each Lender severally agrees, on the terms and
subject to the conditions hereinafter set forth,

(i)            to make loans (each such loan, a “Loan”) to Borrower from time to
time on any Business Day during the period from the Closing Date to the Maturity
Date to be used for the interim financing of acquisitions, for general working
capital, and for other purposes permitted by Borrower’s organizational documents
other than the repurchase of Guarantor’s common stock, in an aggregate amount
not to exceed such Lender’s Pro Rata Share of the Availability, and

(ii)           to fund drawings on any Letters of Credit that the L/C Issuer
issues for Borrower’s account from time to time, in an aggregate amount not to
exceed at any time outstanding such Lender’s Pro Rata Share of the amount of
such drawing.  On the date that the L/C Issuer issues a Letter of Credit for
Borrower’s account, each Lender shall be deemed to have unconditionally and
irrevocably purchased from the L/C Issuer a pro rata risk participation in the
stated amount of such Letter of Credit, without recourse or warranty, in an
amount equal to such Lender’s Pro Rata Share of the stated amount of such Letter
of Credit.

(b)           Letters of Credit.  The L/C Issuer agrees to issue Letters of
Credit in its standard form for the account of Borrower or any subsidiary, Joint
Venture or Permitted Affiliate on any Business Day during the period from the
Closing Date to the Maturity Date, for any purpose for which Borrower can obtain
Loans under this Agreement, in an aggregate amount not to exceed the Letter of
Credit Sublimit; provided, however, that no Letter of Credit shall have an
expiry date (or shall have an “evergreen” or other extension provision that
results in a final expiry date) that is later than 30 days prior to the
then-applicable Maturity Date.

(c)           Letter of Credit Applications and Issuer Documents.  Each Letter
of Credit issued hereunder (including any supplement, modification, amendment,
renewal or extension thereof) will be issued pursuant to the L/C Issuer’s
standard form of Letter of Credit Application, substantially in the form
attached hereto as Exhibit C (as such form may be modified by PNC Bank from time
to time), which will set forth the agreement between the account party and the
L/C Issuer regarding the Letter of Credit and drawings thereunder.  A copy of
each such Letter of Credit Application submitted to the L/C Issuer shall be
simultaneously delivered to the Administrative Agent.  Additionally, Borrower
shall furnish to the L/C Issuer and Administrative Agent such other documents
and information pertaining to such requested Letter of Credit issuance or
amendment, including any Issuer Documents, as the L/C Issuer or Administrative
Agent may reasonably require.  In the event of any conflict between the terms
hereof and the terms of any Issuer Document, the terms hereof shall control.

(d)           Issuance of Letter of Credit.  Promptly after receipt of any
Letter of Credit Application, the L/C Issuer will confirm with Administrative
Agent (by telephone or in writing) that Administrative Agent has received a copy
of such Letter of Credit Application from Borrower or account party thereof and,
if not, the L/C Issuer will provide Administrative Agent with a copy
thereof.  Unless the L/C Issuer has received written notice from Administrative
Agent or Borrower at least one Business Day prior to the requested date of
issuance or amendment of the applicable Letter of Credit, that one or more
applicable conditions contained in Section 5.2 shall not then be satisfied,
then, subject to the terms and conditions hereof, the L/C Issuer shall, on the
requested date, issue a Letter of Credit for the account of Borrower (or the
applicable subsidiary, Joint Venture or Permitted Affiliate) or enter into the
applicable amendment, as the case may be, in each case in accordance with the
L/C Issuer’s usual and customary business practices.  Immediately upon the
issuance of each Letter of Credit, each Lender shall be deemed to, and hereby
irrevocably and unconditionally agrees to, purchase from the L/C Issuer a risk
participation in such Letter of Credit in an amount equal to the product of such
Lender’s Pro Rata Share times the amount of such Letter of Credit.

 
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(e)           Drawings Constituting L/C Borrowings.  Notwithstanding the
provisions of Section 2.5.1, any amount drawn under a Letter of Credit shall,
from and after the date on which such drawing is made, constitute a Borrowing
for all purposes under this Agreement (including accrual and payment of interest
and repayment of principal), other than disbursement of Loan proceeds under
Section 2.5, and shall be subject to the provisions of Section
2.5.1.  Reimbursement of drawings under any Letter of Credit issued for the
account of Borrower’s subsidiary, Joint Venture or Permitted Affiliate shall be
the responsibility of, and shall create an obligation of, Borrower and any
guarantor, including Guarantor and each Permitted Affiliate.

(f)           Limited to Availability.  Notwithstanding any contrary provision
of this Agreement, the Outstanding Amount of all Loans and Swing Loans plus the
Outstanding Amount of all L/C Obligations shall not at any time exceed the
Availability.  Within the limits of the Availability, and subject to the other
terms and conditions hereof, Borrower may borrow under this Section 2.1 and
under Section 2.5 prior to the Maturity Date, repay pursuant to Section 2.8 and
reborrow pursuant to this Section 2.1 and pursuant to Section 2.5 prior to the
Maturity Date.

(g)           Benefits of L/C Issuer.  The L/C Issuer shall act on behalf of the
Lenders with respect to any Letters of Credit issued by it and the documents
associated therewith, and the L/C Issuer shall have all of the benefits and
immunities (i) provided to Administrative Agent in Article 9 with respect to any
acts taken or omissions suffered by the L/C Issuer in connection with Letters of
Credit issued by it or proposed to be issued by it and Issuer Documents
pertaining to such Letters of Credit as fully as if the term “Administrative
Agent” as used in Article 9 included the L/C Issuer with respect to such acts or
omissions, and (ii) as additionally provided herein with respect to the L/C
Issuer.

2.1.1        No Obligation to Issue Letters of Credit Under Certain
Circumstances.  The L/C Issuer shall not be under any obligation to issue any
Letter of Credit if:

(a)           any order, judgment or decree of any Governmental Authority or
arbitrator shall by its terms purport to enjoin or restrain the L/C Issuer from
issuing such Letter of Credit, or any law applicable to the L/C Issuer or any
request or directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over the L/C Issuer shall prohibit, or
request that the L/C Issuer refrain from, the issuance of letters of credit
generally or such Letter of Credit in particular or shall impose upon the L/C
Issuer with respect to such Letter of Credit any restriction, reserve or capital
requirement (for which the L/C Issuer is not otherwise compensated hereunder)
not in effect on the Closing Date, or shall impose upon the L/C Issuer any
unreimbursed loss, cost or expense which was not applicable on the Closing Date
and which the L/C Issuer in good faith deems material to it;

 
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(b)           the issuance of such Letter of Credit would violate any laws or
one or more policies of the L/C Issuer; or

(c)           a default of any Lender’s obligations to fund under Section
2.5.1(b) exists or any Lender is at such time a Defaulting Lender hereunder,
unless the L/C Issuer has entered into satisfactory arrangements with Borrower
or such Lender to eliminate the L/C Issuer’s risk with respect to such Lender
including, without limitation, Borrower providing Cash Collateral in the amount
of such Defaulting Lender’s Pro Rata Share of the requested Letter of Credit.

Letters of Credit shall be issued only for drawing in United States dollars.  No
Letters of Credit with automatic extension or reinstatement provisions shall be
permitted.

2.1.2        Letter of Credit Amendments.  The L/C Issuer shall not amend any
Letter of Credit if the L/C Issuer would not be permitted at such time to issue
such Letter of Credit in its amended form under the terms hereof.

2.1.3        Applicability of ISP98.  Unless otherwise expressly agreed by the
L/C Issuer and Borrower when a Letter of Credit is issued, the rules of the ISP
shall apply to each standby Letter of Credit.

2.2           Swing Line.

2.2.1        Swing Loans.  Upon Borrower’s request, and subject to the terms and
conditions of this Agreement, the Swing Line Lender may, in its sole and
absolute discretion, on and after the Closing Date and prior to the Maturity
Date, provide to Borrower a swing line credit facility (the “Swing Line”) of up
to $20,000,000; provided that the Swing Line Lender shall not in any event make
any Loan under the Swing Line (each a “Swing Loan” and collectively, the “Swing
Loans”) if, after giving effect thereto, (a) the sum of the Outstanding Amount
of all Loans and Swing Loans plus the Outstanding Amount of all L/C Obligations
would exceed the Availability at such time or (b) the aggregate principal amount
of all then-outstanding Swing Loans made by the Swing Line Lender would exceed
the Swing Line Availability at such time.  Within the limits of the Swing Line
Availability, Borrower may borrow under this Section 2.2.1 at any time prior to
the Maturity Date, repay pursuant to Sections 2.2.3 or 2.2.4 and reborrow
pursuant to this Section 2.2.1 prior to the Maturity Date.  Notwithstanding any
contrary provision of this Section 2.2, the Swing Line Lender shall not at any
time be obligated to make any Swing Loan.  Borrower shall not use the proceeds
of any Swing Loan to refinance any outstanding Swing Loan.

2.2.2        Interest on Swing Loans.  Notwithstanding the provisions of
Sections 2.10.1 and 2.10.2, each Swing Loan outstanding under the Swing Line
shall accrue interest at a rate per annum equal to the interest rate applicable
to a Reference Rate Loan, which interest shall be payable in arrears on each
Interest Payment Date and on the due date for Swing Loans set forth in Section
2.2.3, and shall be payable to Administrative Agent for the account of the Swing
Line Lender; provided that, notwithstanding any other provision of this
Agreement, each Swing Loan shall bear interest for a minimum of one day.

 
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2.2.3        Principal Payable on Swing Loans.  Notwithstanding the provisions
of Section 2.8. the principal outstanding under the Swing Line shall be due and
payable:

(a)           at or before 2:00 p.m., on the third Business Day immediately
following any date on which a Swing Loan is made under the Swing Line; and

(b)           in any event on the Maturity Date;

provided that, if no Event of Default has occurred and remains uncured, and
Borrower is permitted to borrow under the terms of this Agreement (the
Availability being determined for such purpose without giving effect to any
reduction thereof occasioned by such Swing Loans due and payable) at the time
such Swing Loans are due, then unless Borrower notifies the Swing Line Lender
that it will repay such Swing Loans on their due date, Borrower shall be deemed
to have submitted a Notice of Borrowing or Conversion/Continuation for Reference
Rate Loans in an amount necessary to repay such Swing Loans on their due date,
and the provisions of Section 2.3 concerning (i) the minimum principal amounts
required for Borrowings and (ii) the funding of requested Borrowings as Swing
Loans shall not apply to Loans made pursuant to this Section 2.2.3.

2.2.4        Prepayments of Swing Loans.  Notwithstanding the provisions of
Section 2.8.1, Borrower may, from time to time on any Business Day, make a
voluntary prepayment, in whole or in part, of the outstanding principal amount
of any Swing Loans, without incurring any premium or penalty; provided that:

(a)           each such voluntary prepayment shall require prior written notice
given to Administrative Agent and Swing Line Lender no later than 1:00 p.m. on
the day on which Borrower intends to make a voluntary prepayment, and

(b)           each such voluntary prepayment shall be in a minimum amount of
$500,000 (or, if less, the aggregate outstanding principal amount of all Swing
Loans then outstanding).

2.2.5        Funding of Participations.  Immediately upon the making of a Swing
Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the Swing Line Lender a risk participation in such
Swing Loan in an amount equal to the product of such Lender’s Pro Rata Share
times the amount of such Swing Loan.  The Swing Line Lender shall be responsible
for invoicing Borrower for interest on the Swing Loans.  Until each Bank funds
its Reference Rate Loan or risk participation pursuant to this Section 2.2.5 to
refinance such Bank’s Pro Rata Share of any Swing Loan, interest in respect of
such Pro Rata Share shall be solely for the account of the Swing Line
Lender.  From and after the date that any Lender funds such participation
pursuant to this Section 2.2.5, such Lender shall, to the extent of its Pro Rata
Share, be entitled to receive a ratable portion of any payment of principal
and/or interest received by the Swing Line Lender on account of such Swing
Loans, payable to such Lender promptly upon such receipt.  If any payment
received by the Swing Line Lender in respect of principal or interest on any
Swing Loan is required to be returned by the Swing Line Lender under any of the
circumstances described in Section 10.9 (including pursuant to any settlement
entered into by the Swing Line Lender in its discretion), each Lender shall pay
to the Swing Line Lender its Pro Rata Share thereof on demand of Administrative
Agent, plus interest thereon from the date of such demand to the date such
amount is returned, at a rate per annum equal to the Reference
Rate.  Administrative Agent will make such demand upon the request of the Swing
Line Lender.  The foregoing procedures for purchases of risk participations and
the funding by Lenders of their participations in Swing Loans hereunder shall
not delay the funding of any Swing Loan advanced to Borrower under Section 2.2.1
hereof.

 
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2.2.6        Refinancing of Swing Loans.

(a)           The Swing Line Lender at any time in its sole and absolute
discretion may request, on behalf of Borrower (which hereby irrevocably
authorizes the Swing Line Lender to so request on its behalf), that each Lender
make a Reference Rate Loan in an amount equal to such Lender’s Pro Rata Share of
the amount of Swing Loans then outstanding.  Such request shall be made in
writing (which written request shall be deemed to be a Notice of Borrowing or
Conversion/Continuation issued under Section 2.3 for purposes hereof) and in
accordance with the requirements of Section 2.3, without regard to the minimum
and multiples specified therein for the principal amount of Reference Rate
Loans, but subject to the unutilized portion of the Commitments and the
conditions set forth in Section 5.2.  The Swing Line Lender shall furnish
Borrower with a copy of the applicable Notice of Borrowing or
Conversion/Continuation promptly after delivering such Notice of Borrowing or
Conversion/Continuation to Administrative Agent.  Each Lender shall make an
amount equal to its Pro Rata Share of the amount specified in such Notice of
Borrowing or Conversion/Continuation available to Administrative Agent in
immediately available funds for the account of the Swing Line Lender at
Administrative Agent’s Office not later than 2:00 p.m. on the day specified in
such Notice of Borrowing or Conversion/Continuation.  Subject to Section
2.2.6(b), each Lender that so makes funds available shall be deemed to have made
a Reference Rate Loan to Borrower in such amount.  Administrative Agent shall
remit the funds so received to the Swing Line Lender.  Notwithstanding the
foregoing, the issuance of a Notice of Borrowing or Conversion/Continuation by
the Swing Line Lender under this Section 2.2.6(a) shall not delay the funding of
any Swing Loan advanced to Borrower under Section 2.2.1 hereof.

(b)           If for any reason any Swing Loan cannot be refinanced by a
Borrowing in accordance with Section 2.2.6(a), the request for Reference Rate
Loans submitted by the Swing Line Lender as set forth herein shall be deemed to
be a request by the Swing Line Lender that each of the Lenders fund its risk
participation in the relevant Swing Loan and each Lender’s payment to
Administrative Agent for the account of the Swing Line Lender pursuant to
Section 2.2.6(a) shall be deemed payment in respect of such participation.

(c)           If any Lender fails to make available to Administrative Agent for
the account of the Swing Line Lender any amount required to be paid by such
Lender pursuant to the foregoing provisions of this Section 2.2.6 by the time
specified in Section 2.2.6(a), the Swing Line Lender shall be entitled to
recover from such Lender (acting through Administrative Agent), on demand, such
amount with interest thereon for the period from the date such payment is
required to the date on which such payment is immediately available to the Swing
Line Lender at a rate per annum equal to the Federal Funds Rate from time to
time in effect.  A certificate of the Swing Line Lender submitted to any Lender
(through Administrative Agent) with respect to any amounts owing under this
Section 2.2.6(c) shall be conclusive absent manifest error.

 
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(d)           Each Lender’s obligation to make Loans or to purchase and fund
risk participations in Swing Loans pursuant to this Section 2.2.6 shall be
absolute and unconditional and shall not be affected by any circumstance,
including (i) any set-off, counterclaim, recoupment, defense or other right
which such Lender may have against the Swing Line Lender, Borrower or any other
Person for any reason whatsoever, (ii) subject to Section 2.2.8, the occurrence
or continuance of a Default, or (iii) any other occurrence, event or condition,
whether or not similar to any of the foregoing; provided, however, that each
Lender’s obligation to make Loans pursuant to this Section 2.2.6 is subject to
the conditions set forth in Section 5.2.  No such funding of risk participations
shall relieve or otherwise impair the obligation of Borrower to repay Swing
Loans, together with interest as provided herein.

2.2.7        Termination of Swing Line.  At any time during the continuance of
an Event of Default, the Swing Line Lender may, without Borrower’s consent, upon
one Business Day’s notice to Borrower, terminate the Swing Line and cause
Reference Rate Loans to be made by the Lenders in an aggregate amount equal to
the amount of principal and interest outstanding under the Swing Line (the
Availability being determined for such purpose without giving effect to any
reduction thereof occasioned by such Swing Loans), and the conditions precedent
set forth in Section 2.3 and Section 5.2, and any requirement of Section 2.3
that a Borrowing be funded as a Swing Loan shall not apply to such Loans.  The
proceeds of such Loans shall be paid to the Swing Line Lender to retire the
outstanding principal and interest owing under the Swing Line.

2.2.8        No Swing Loans Upon Default.  The Swing Line Lender shall not,
without the approval of all Lenders, make a Swing Loan if the Swing Line Lender
then has actual knowledge that a Default has occurred and is continuing.

2.3           Procedure for Obtaining Credit (Loans, Swing Loans and Letters of
Credit).  Each Borrowing shall be made and each Letter of Credit shall be issued
upon the irrevocable written notice (including notice via facsimile confirmed
immediately by a telephone call) of Borrower in the form of a Notice of
Borrowing or Conversion/ Continuation and, with respect to a Letter of Credit
request, a Letter of Credit Application (which notice and, if applicable, Letter
of Credit Application, must be received by Administrative Agent prior to 1:00
p.m., (i) three Business Days prior to the requested borrowing date, in the case
of LIBOR Loans, or (ii) one Business Day prior to the requested borrowing date,
in the case of Reference Rate Loans, or (iii) on the requested borrowing date,
in the case of Swing Loans, or (iv) five Business Days prior to the requested
issuance date of a Letter of Credit), specifying:

(a)           the amount of the Borrowing or the Letter of Credit, which in the
case of a Borrowing shall be in an aggregate principal amount of not less than
(i) $500,000 (or the remaining Availability, if less) for Reference Rate
Borrowings or Swing Loans, and (ii) $1,000,000 and increments of $500,000 in
excess thereof for any LIBOR Borrowings;

 
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(b)           the requested Borrowing or Letter of Credit issuance date, which
shall be a Business Day;

(c)           in the case of a Borrowing, the Type of Loans comprising the
Borrowing;

(d)           in the case of a LIBOR Borrowing, the duration of the Interest
Period applicable to the Loans comprising such LIBOR Borrowing.  If the Notice
of Borrowing or Conversion/Continuation fails to specify the duration of the
Interest Period for the Loans comprising a LIBOR Borrowing, such Interest Period
shall be one month.

Unless the Required Lenders otherwise agree, during the existence of a Default
or Event of Default, Borrower may not elect to have a Loan made as, or converted
into or continued as, a LIBOR Loan.  Notwithstanding the foregoing provisions of
this Section 2.3, any amount drawn under a Letter of Credit shall, from and
after the date on which such drawing is made, constitute a Borrowing for all
purposes under this Agreement (including accrual and payment of interest and
repayment of principal) other than disbursement of Loan proceeds under this
Section 2.3.  After giving effect to any Loan, there shall not be more than
seven (7) different Interest Periods in effect.

In the event a requested Borrowing constitutes a LIBOR Borrowing or a Reference
Rate Borrowing, Administrative Agent shall provide each Lender with the Notice
of Borrowing or Conversion/Continuation relating thereto on the date that
Administrative Agent receives such Notice of Borrowing or
Conversion/Continuation (as applicable) from Borrower, together with the amount
of such Lender’s Pro Rata Share of the amount of the Loans to be funded with
such Borrowing.  Each Lender shall make the amount specified by Administrative
Agent in such notice to such Lender available to Administrative Agent in
immediately available funds for the account of Administrative Agent at
Administrative Agent’s Office not later than 2:00 p.m. on the day specified in
such Notice of Borrowing or Conversion/Continuation.

2.4           Loan Accounts; Notes.

2.4.1        Loan Accounts.  The Loans made by each Lender shall be evidenced by
one or more loan accounts or records maintained by such Lender and by
Administrative Agent in the ordinary course of business.  The loan accounts or
records maintained by Administrative Agent and each Lender shall, absent
manifest error, be conclusive of the amounts of the Loans made by the Lenders to
Borrower and the interest and payments thereon.  Any failure so to record or any
error in doing so shall not, however, limit or otherwise affect Borrower’s
obligations hereunder to pay any amount owing with respect to the Loans.  In
addition to the accounts and records referred to above, each Lender and
Administrative Agent shall maintain in accordance with its usual practice
accounts or records evidencing the purchases and sales by such Lender of
participations in Letters of Credit and Swing Loans.  In the event of any
conflict between the accounts and records maintained by Administrative Agent and
the accounts and records of any Lender in respect of such matters, the accounts
and records of Administrative Agent shall control in the absence of manifest
error.

2.4.2        Notes.  The Loans made by each Lender shall be evidenced by a
Revolving Note in the form of Exhibit G-l hereto, payable to the order of such
Lender in an amount equal to such Lender’s Pro Rata Share of the Maximum
Commitment Amount on the Closing Date.  In addition, the Swing Loans made by the
Swing Line Lender may be evidenced by a Swing Line Note in the form of Exhibit
G-2 hereto, payable to the order of the Swing Line Lender in the maximum amount
of $20,000,000.  Each Lender may endorse on any schedule annexed to its Note(s)
the date, amount and maturity of each Loan that it makes (which shall not
include undrawn amounts on outstanding Letters of Credit, but shall include the
amounts of any drawings on outstanding Letters of Credit), and the amount of
each payment of principal that Borrower makes with respect thereto.  Borrower
irrevocably authorizes each Lender to endorse its Note(s), and such Lender’s
record shall be conclusive absent manifest error; provided, however, that any
Lender’s failure to make, or its error in making, a notation thereon with
respect to any Loan shall not limit or otherwise affect Borrower’s obligations
to such Lender hereunder or under its Note(s).

 
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2.5           Letters of Credit.

2.5.1        Letter of Credit Drawings and Reimbursements; Funding of
Participations.

(a)           Upon receipt from the beneficiary of any Letter of Credit of any
notice of a drawing under such Letter of Credit, the L/C Issuer shall notify
Borrower and Administrative Agent thereof.  Not later than 11:00 a.m. on the
date of any payment by the L/C Issuer under a Letter of Credit (each such date,
an “Honor Date”), Borrower shall reimburse the L/C Issuer through Administrative
Agent in an amount equal to the amount of such drawing.  If Borrower fails to so
reimburse the L/C Issuer by such time, Administrative Agent shall promptly
notify each Lender of the Honor Date, the amount of the unreimbursed drawing
(the “Unreimbursed Amount”), and the amount of such Lender’s Pro Rata Share
thereof.  In such event, Borrower shall be deemed to have requested a Borrowing
of Reference Rate Loans to be disbursed on the Honor Date in an amount equal to
the Unreimbursed Amount, without regard to the minimum and multiples specified
in Section 2.3 for the principal amount of Reference Rate Loans, but subject to
the amount of the unutilized portion of the Commitments and the conditions set
forth in Section 5.2 (other than the delivery of a Notice of Borrowing or
Conversion/Continuation).  Any notice given by the L/C Issuer or Administrative
Agent pursuant to this Section 2.5.1(a) may be given by telephone if immediately
confirmed in writing; provided that the lack of such an immediate confirmation
shall not affect the conclusiveness or binding effect of such notice.

(b)           Each Lender shall upon any notice pursuant to Section 2.5.1(a)
make funds available to Administrative Agent for the account of the L/C Issuer,
at Administrative Agent’s Office in an amount equal to its Pro Rata Share of the
Unreimbursed Amount not later than 2:00 p.m. on the Business Day specified in
such notice by Administrative Agent, whereupon, subject to the provisions of
Section 2.5.1(c), each Lender that so makes funds available shall be deemed to
have made a Reference Rate Loan to Borrower in such amount.  Administrative
Agent shall remit the funds so received to the L/C Issuer.

(c)           With respect to any Unreimbursed Amount that is not fully
refinanced by a Borrowing of Reference Rate Loans because the conditions set
forth in Section 5.2 cannot be satisfied or for any other reason, Borrower shall
be deemed to have incurred from the L/C Issuer, an L/C Borrowing in the amount
of the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall
be due and payable on demand (together with interest) and shall bear interest at
the rate set forth in Section 2.10.3.  In such event, each Lender’s payment to
Administrative Agent for the account of the L/C Issuer pursuant to
Section 2.5.1(b) shall be deemed payment in respect of its participation in such
L/C Borrowing and shall constitute an L/C Advance from such Lender in
satisfaction of its participation obligation under this Section 2.5.1.

 
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(d)           Until each Lender funds its Loan or L/C Advance pursuant to this
Section 2.5.1 to reimburse the L/C Issuer for any amount drawn under any Letter
of Credit, interest in respect of such Lender’s Pro Rata Share of such amount
shall be solely for the account of the L/C Issuer.

(e)           Each Lender’s obligation to make Loans or L/C Advances to
reimburse the L/C Issuer, for amounts drawn under Letters of Credit, as
contemplated by this Section 2.5.1, shall be absolute and unconditional and
shall not be affected by any circumstance, including (i) any set-off,
counterclaim, recoupment, defense or other right which such Lender may have
against the L/C Issuer, Borrower or any other Person for any reason whatsoever;
(ii) the occurrence or continuance of a Default, or (iii) any other occurrence,
event or condition, whether or not similar to any of the foregoing; provided,
however, that each Lender’s obligation to make Loans pursuant to this Section
2.5.1 is subject to the conditions set forth in Section 5.2 (other than delivery
by Borrower of a Notice of Borrowing or Conversion/Continuation).  No such
making of an L/C Advance shall relieve or otherwise impair the obligation of
Borrower to reimburse the L/C Issuer for the amount of any payment made by the
L/C Issuer under any Letter of Credit, together with interest as provided
herein.

(f)            If any Lender fails to make available to Administrative Agent for
the account of the L/C Issuer any amount required to be paid by such Lender
pursuant to the foregoing provisions of this Section 2.5.1 by the time specified
in Section 2.5.1(b), the L/C Issuer, shall be entitled to recover from such
Lender (acting through Administrative Agent), on demand, such amount with
interest thereon for the period from the date such payment is required to the
date on which such payment is immediately available to the L/C Issuer at a rate
per annum equal to the Federal Funds Rate from time to time in effect.  A
certificate of the L/C Issuer submitted to any Lender (through Administrative
Agent) with respect to any amounts owing under this Section 2.5.1(f) shall be
conclusive absent manifest error.

2.5.2        Repayment of Participations.

(a)           At any time after the L/C Issuer has made a payment under any
Letter of Credit and has received from any Lender such Lender’s L/C Advance in
respect of such payment in accordance with Section 2.5.1, if Administrative
Agent receives for the account of the L/C Issuer any payment in respect of the
related Unreimbursed Amount or interest thereon (whether directly from Borrower
or otherwise, including proceeds of Cash Collateral applied thereto by
Administrative Agent), Administrative Agent will distribute to such Lender its
Pro Rata Share thereof (appropriately adjusted, in the case of interest
payments, to reflect the period of time during which such Lender’s L/C Advance
was outstanding) in the same funds as those received by Administrative Agent.

(b)           If any payment received by Administrative Agent for the account of
the L/C Issuer pursuant to Section 2.5.1(a) is required to be returned under any
of the circumstances described in Section 10.9 (including pursuant to any
settlement entered into by the L/C Issuer, in its discretion), each Lender shall
pay to Administrative Agent for the account of the L/C Issuer its Pro Rata Share
thereof on demand of Administrative Agent, plus interest thereon from the date
of such demand to the date such amount is returned by such Lender, at a rate per
annum equal to the Federal Funds Rate from time to time in effect.

 
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2.5.3        Obligations Absolute.  The obligation of Borrower to reimburse the
L/C Issuer, for each drawing under each Letter of Credit and to repay each L/C
Borrowing shall be absolute, unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including the following:

(a)           any lack of validity or enforceability of such Letter of Credit,
this Agreement, or any other Loan Document;

(b)           the existence of any claim, counterclaim, set-off, defense or
other right that Borrower or any subsidiary, Joint Venture or Permitted
Affiliate may have at any time against any beneficiary or any transferee of such
Letter of Credit (or any Person for whom any such beneficiary or any such
transferee may be acting), the L/C Issuer, or any other Person, whether in
connection with this Agreement, the transactions contemplated hereby or by such
Letter of Credit or any agreement or instrument relating thereto, or any
unrelated transaction;

(c)           any draft, demand, certificate or other document presented under
such Letter of Credit proving to be forged, fraudulent, invalid or insufficient
in any respect or any statement therein being untrue or inaccurate in any
respect; or any loss or delay in the transmission or otherwise of any document
required in order to make a drawing under such Letter of Credit;

(d)           any payment by the L/C Issuer under such Letter of Credit against
presentation of a draft or certificate that does not strictly comply with the
terms of such Letter of Credit; or any payment made by the L/C Issuer under such
Letter of Credit to any Person purporting to be a trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of or successor to any beneficiary or any
transferee of such Letter of Credit, including any arising in connection with
any proceeding under any insolvency or bankruptcy law; or

(e)           any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including any other circumstance that might
otherwise constitute a defense available to, or a discharge of, Borrower or any
subsidiary, Joint Venture or Permitted Affiliate.

Borrower shall promptly examine a copy of each Letter of Credit and each
amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with Borrower’s instructions or other irregularity, Borrower will
promptly notify the L/C Issuer.  Borrower shall be conclusively deemed to have
waived any such claim against the L/C Issuer and its correspondents unless such
notice is given as aforesaid.

2.5.4        Role of Letter of Credit Issuer.  Each Lender and Borrower agree
that, in paying any drawing under a Letter of Credit, the L/C Issuer shall not
have any responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by the Letter of Credit) or to
ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document.  None of the
L/C Issuer, Administrative Agent or any of their respective Related Parties nor
any of the respective correspondents, participants or assignees of the L/C
Issuer shall be liable to any Lender for (a) any action taken or omitted in
connection herewith at the request or with the approval of the Lenders or the
Requisite Lenders, as applicable; (b) any action taken or omitted in the absence
of gross negligence or willful misconduct; or (c) the due execution,
effectiveness, validity or enforceability of any document or instrument related
to any Letter of Credit or Issuer Document.  Borrower hereby assumes all risks
of the acts or omissions of any beneficiary or transferee with respect to its
use of any Letter of Credit; provided, however, that this assumption is not
intended to, and shall not, preclude Borrower’s pursuing such rights and
remedies as it may have against the beneficiary or transferee at law or under
any other agreement.  None of the L/C Issuer, Administrative Agent or any of
their respective Related Parties, nor any of the respective correspondents,
participants or assignees of the L/C Issuer, shall be liable or responsible for
any of the matters described in clauses (a) through (e) of Section 2.5.3.  In
furtherance and not in limitation of the foregoing, the L/C Issuer may accept
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary,
and the L/C Issuer shall not be responsible for the validity or sufficiency of
any instrument transferring or assigning or purporting to transfer or assign a
Letter of Credit or the rights or benefits thereunder or proceeds thereof, in
whole or in part, which may prove to be invalid or ineffective for any
reason.  Notwithstanding anything to the contrary in Section 2.5.3 or in this
Section 2.5.4, Borrower or any subsidiary, Joint Venture or Permitted Affiliate
for whose benefit a Letter of Credit was issued may have a claim against the L/C
Issuer, and the L/C Issuer may be liable to Borrower or such subsidiary, Joint
Venture or Permitted Affiliate, to the extent, but only to the extent, of any
direct, as opposed to consequential or exemplary, damages suffered by Borrower
or such subsidiary, Joint Venture or Permitted Affiliate which Borrower or such
subsidiary, Joint Venture or Permitted Affiliate proves were caused by the
willful misconduct or gross negligence of the L/C Issuer or the willful failure
of the L/C Issuer to pay under any Letter of Credit after the presentation to it
by the beneficiary of a sight draft and certificate(s) strictly complying with
the terms and conditions of a Letter of Credit.

 
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2.5.5        Cash Collateral.  Upon the request of Administrative Agent, (a) if
the L/C Issuer has honored any full or partial drawing request under any Letter
of Credit and such drawing has resulted in an L/C Borrowing, or (b) if, as of
the Letter of Credit expiration date, any Letter of Credit for any reason
remains outstanding and partially or wholly undrawn, Borrower shall immediately
Cash Collateralize the aggregate undrawn amount of all outstanding Letters of
Credit plus the aggregate of all Unreimbursed Amounts (determined as of the date
of such L/C Borrowing or the Letter of Credit expiration date, as the case may
be).  Sections  2.8.2(a) and 8.2 .3 set forth certain additional requirements to
deliver Cash Collateral hereunder.  “Cash Collateralize” means to pledge and
deposit with or deliver to Administrative Agent, for the benefit of the L/C
Issuer and the Lenders, as collateral for the L/C Obligations, cash or deposit
account balances pursuant to documentation in form and substance reasonably
satisfactory to Administrative Agent and the L/C Issuer (which documents are
hereby consented to by the Lenders).  Borrower hereby grants to Administrative
Agent, for the benefit of the L/C Issuer and the Lenders, a security interest in
all such cash, deposit accounts and all balances therein and all proceeds of the
foregoing.  Cash Collateral shall be maintained in blocked, non-interest bearing
deposit accounts at Administrative Agent.

 
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2.6           Conversion and Continuation Elections of Loans.

2.6.1        Election to Convert and Renew.  Borrower may, upon irrevocable
written notice to Administrative Agent in accordance with Section 2.6.2:

(a)           elect to convert, on any Business Day, any Reference Rate Loans
(or any part thereof in an amount not less than $1,000,000 and increments of
$500,000 in excess thereof) into LIBOR Loans;

(b)           elect to convert on the last day of any Interest Period any LIBOR
Loans maturing on such date (or any part thereof in an amount not less than
$500,000) into Reference Rate Loans; or

(c)           elect to renew on the last day of any Interest Period (for a new
Interest Period that commences immediately upon the expiration of such existing
Interest Period) any LIBOR Loans maturing on such date (or any part thereof in
an amount not less than $1,000,000 and increments of $500,000 in excess
thereof);

provided, that if the aggregate amount of LIBOR Loans in respect of any
Borrowing shall have been reduced, by payment, prepayment or conversion of part
thereof, to less than $1,000,000, such LIBOR Loans shall automatically convert
into Reference Rate Loans, and on and after such date the right of Borrower to
continue such Loans as, and convert such Loans into, LIBOR Loans shall
terminate.

2.6.2        Notice of Conversion/Continuation.  Borrower shall deliver in
writing (including via facsimile confirmed immediately by a telephone call) a
Notice of Borrowing or Conversion/Continuation (which notice must be received by
Administrative Agent not later than 1:00 p.m., (i) at least three Business Days
prior to the conversion date or continuation date, if the Loans are to be
converted into or continued as LIBOR Loans, or (ii) on the conversion date, if
the Loans are to be converted into Reference Rate Loans) specifying:

(a)           the proposed conversion date or continuation date;

(b)           the aggregate amount of Loans to be converted or continued;

(c)           the nature of the proposed conversion or continuation; and

(d)           if Borrower elects to convert a Reference Rate Loan into a LIBOR
Loan or elects to continue a LIBOR Loan, the duration of the Interest Period
applicable to such Loan.  If the Notice of Borrowing or Conversion/Continuation
fails to specify the duration of the Interest Period for a LIBOR Loan, such
Interest Period shall be one month.

2.6.3        Failure to Select a New Interest Period.  If upon the expiration of
any Interest Period applicable to LIBOR Loans Borrower has failed to select a
new Interest Period to be applicable to LIBOR Loans, or if any Default or Event
of Default shall then exist, Borrower shall be deemed to have elected to convert
LIBOR Loans into Reference Rate Loans effective as of the expiration date of
such current Interest Period.

 
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2.6.4        Number of Interest Periods.  Notwithstanding any other provision of
this Agreement, after giving effect to any conversion or continuation of any
Loans, there shall not be more than seven (7) different Interest Periods in
effect for the Loans.

2.7           Voluntary Termination or Reduction of Commitment.  Borrower may,
upon not less than five Business Days’ prior written notice to Administrative
Agent, terminate the Lenders’ Commitment to make Loans to Borrower or issue
Letters of Credit for Borrower’s account, or permanently reduce the Maximum
Commitment Amount by a minimum amount of $5,000,000, unless, after giving effect
thereto and to any prepayments of Loans made on the effective date thereof, the
sum of the aggregate principal amount of (i) the Outstanding Amount of the Loans
and Swing Loans and (ii) the Outstanding Amount of L/C Obligations would exceed
the Availability.  Once reduced in accordance with this Section 2.7, the Maximum
Commitment Amount may not be increased.  Any reduction of the Commitment amounts
shall be applied to each Lender according to its Pro Rata Share.  No commitment
or extension fees paid prior to the effective date of any reduction of the
Maximum Commitment Amount or termination of the Lenders’ and Swing Line Lender’s
commitment(s) to make Loans or Swing Loans to Borrower or issue Letters of
Credit for Borrower’s account shall be refunded, and all accrued Facility Fee
for the period up to but not including the effective date of any reduction or
termination of the Commitments shall be payable on the effective date of such
reduction or termination.

2.8           Principal Payments.

2.8.1        Optional Prepayments of the Loans.  Subject to the provisions of
Section 3.4, Borrower may, at any time or from time to time, upon at least one
Business Day’s prior written notice to Administrative Agent with respect to any
Reference Rate Loan, or upon at least three Business Day’s prior written notice
to Administrative Agent with respect to any LIBOR Loan, ratably prepay Loans in
full or in part in an amount not less than $500,000 for Reference Rate Loans
(or, if less, the aggregate outstanding principal amount of all Reference Rate
Loans and/or Swing Loans) or $1,000,000 for LIBOR Loans.  Such notice of
prepayment shall specify the date and amount of such prepayment and the Type(s)
of Loans to be prepaid.  Administrative Agent will promptly notify each Lender
of its receipt of any such notice and such Lender’s Pro Rata Share of such
prepayment.  If Borrower gives a prepayment notice to Administrative Agent, such
notice is irrevocable and the prepayment amount specified in such notice shall
be due and payable on the date specified therein, together with accrued interest
to such date on the amount prepaid in the case of a prepayment of LIBOR Loans,
and all amounts required to be paid pursuant to Section 3.4.

2.8.2        Mandatory Repayments.

(a)           Availability Limit.  Should the Outstanding Amount of Loans and
Swing Loans plus the Outstanding Amount of L/C Obligations at any time exceed
the Availability, Borrower shall immediately repay such excess to Administrative
Agent, for the account of the Lenders and/or deliver to Administrative Agent
Cash Collateral pursuant to Section 2.5.5 hereof, in the amount of the excess of
the outstanding but undrawn Letters of Credit over the Availability.

 
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(b)           Application of Repayments.  Any repayments pursuant to this
Section 2.8.2 shall be (i) subject to Section 3.4, and (ii) applied first, to
any Reference Rate Loans then outstanding and second, to the LIBOR Loans (in
order of the shortest Interest Periods remaining).

2.8.3        Repayment at Maturity.  Borrower shall repay the principal amount
of all outstanding Loans on the Maturity Date or, if earlier, upon termination
of the Lenders’ Commitments pursuant to Section 2.7.

2.9           Extension of Maturity Date.  Upon Borrower’s written request,
delivered to Administrative Agent at least 60 days and not more than 90 days
prior to the then-scheduled Maturity Date, Borrower shall have the right to
extend the Original Maturity Date for the First Extension Period and, if the
extension option for the First Extension Period has been duly exercised, the
right to further extend the date the Loans mature for the Second Extension
Period, provided that:

(a)           No Default or Event of Default shall have occurred and remain
uncured on the applicable Maturity Date, and Administrative Agent shall have
received a certificate to that effect signed by a Responsible Officer of
Borrower;

(b)           The representations and warranties set forth in this Agreement and
the other Loan Documents shall be correct as of the applicable Maturity Date as
though made on and as of that date, and Administrative Agent shall have received
a certificate to that effect signed by a Responsible Officer of Borrower;

(c)           Borrower shall have paid to Administrative Agent, for the account
of the Lenders, an extension fee equal to (i) twenty five basis points (0.25%)
multiplied by the Maximum Commitment Amount on the Original Maturity Date (with
respect to the First Extension Period), and (ii) twenty basis points (0.20%)
multiplied by the Maximum Commitment Amount on the last day of the First
Extension Period (with respect to the Second Extension Period).  The Extension
Fee shall be determined as of the date Borrower provides the extension notice
for the applicable Extension Period and shall be paid by Borrower on the first
day of such Extension Period; and

(d)           Borrower shall have executed, acknowledged and delivered to
Administrative Agent such documents as Administrative Agent reasonably
determines to be necessary to evidence the extension of the Maturity Date.

2.10         Interest.

2.10.1      Accrual Rate.  Subject to the provisions of Section 2.10.3, (i) each
Loan shall bear interest on the outstanding principal amount thereof from the
date when made (which, in the case of a drawing on a Letter of Credit, is the
date of such drawing) until it becomes due at a rate per annum equal to (A) with
respect to a LIBOR Loan, the LIBOR Rate plus the Applicable LIBOR Margin, and
(B) with respect to a Reference Rate Loan, the Reference Rate plus the
Applicable Reference Rate Margin; and (ii) each Swing Loan shall bear interest
on the outstanding principal amount thereof from the applicable borrowing date
at the rate set forth in Section 2.2.2 hereof.

 
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2.10.2      Payment.  Interest on each Loan shall be payable in arrears on each
Interest Payment Date.  Interest shall also be payable on the date of any
repayment of Loans pursuant to Section 2.8 for the portion of the Loans so
repaid, if required by Section 2.9, and upon payment (including prepayment) of
the Loans in full.  During the existence of any Event of Default, interest shall
also be payable on demand.

2.10.3      Default Interest.  Commencing upon the occurrence of any Event of
Default, and continuing thereafter while such Event of Default remains uncured,
or after maturity or acceleration (unless and until such acceleration is
rescinded), Borrower shall pay interest (after as well as before entry of
judgment thereon to the extent permitted by law) on the principal amount of all
Obligations due and unpaid, at a rate per annum determined by adding 400 basis
points to the Applicable Margin then in effect for such Loans and, in the case
of Obligations not subject to an Applicable Margin, at a rate per annum equal to
the Reference Rate plus 400 basis points; provided, however, that on and after
the expiration of any Interest Period applicable to any LIBOR Loan outstanding
on the date of occurrence of such Event of Default, the principal amount of such
Loan shall, during the continuation of such Event of Default, bear interest at a
rate per annum equal to the Reference Rate plus 400 basis points in excess of
the Applicable Reference Rate Margin then in effect.

2.10.4      Maximum Legal Rate.  Notwithstanding anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under the
Loan Documents shall not exceed the maximum rate of non-usurious interest
permitted by applicable Law (the “Maximum Rate”).  If Administrative Agent or
any Lender shall receive interest in an amount that exceeds the Maximum Rate,
the excess interest shall be applied to the principal of the Loans or, if it
exceeds such unpaid principal, refunded to Borrower.  In determining whether the
interest contracted for, charged, or received by Administrative Agent or a
Lender exceeds the Maximum Rate, such Person may, to the extent permitted by
applicable Law, (a) characterize any payment that is not principal as an
expense, fee, or premium rather than interest, (b) exclude voluntary prepayments
and the effects thereof, and (c) amortize, prorate, allocate, and spread in
equal or unequal parts the total amount of interest throughout the contemplated
term of the Obligations hereunder.

2.11         Fees.

2.11.1      Facility Fee.  Borrower shall pay to Administrative Agent, for the
account of the Lenders (based on their respective Pro Rata Shares), a facility
fee (the “Facility Fee”) computed based on the annual Facility Fee rate
specified in the definition of the term “Applicable Margin,” multiplied by the
actual daily amount of the Maximum Commitment Amount, in each case measured
quarterly and payable quarterly in arrears on (a) each January 1, April 1, July
1, and October 1, commencing January 1, 2010 (for the calendar quarter ending
December 31, 2009, but with such initial payment of the Facility Fee pro rated
from the Closing Date) and (b) the Maturity Date (with such final payment of the
Facility Fee pro rated to the Maturity Date).

 
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2.11.2      Letter of Credit Fees.  Borrower shall pay to Administrative Agent,
for the account of the Lenders (based on their respective Pro Rata Shares), a
letter of credit fee (the “Letter of Credit Fee”) for each issued and
outstanding Letter of Credit in an amount equal to the Applicable LIBOR Margin
multiplied by the daily amount available to be drawn under such Letter of
Credit.  For purposes of computing the daily amount available to be drawn under
any Letter of Credit, the amount of such Letter of Credit shall be determined in
accordance with Section 1.2.4.  The Letter of Credit Fees shall be due and
payable quarterly in arrears on (a) each January 1, April 1, July 1, and October
1, commencing January 1, 2010 (for the calendar quarter ending December 31,
2009, but with such initial payment of the Letter of Credit Fee pro rated from
the Closing Date) and (b) the Maturity Date (with such final payment of the
Letter of Credit Fee pro rated to the Maturity Date).  Borrower shall also pay
to Administrative Agent, for the account of the L/C Issuer, at the time each
Letter of Credit is issued, a fronting fee (the “Fronting Fee”) in an amount
equal to twenty five basis points (0.25%) multiplied by the amount of such
Letter of Credit.  In addition, Borrower shall pay directly to the L/C Issuer
for its own account the other customary administrative, issuance, presentation,
amendment and other processing fees, and other standard costs and charges, of
the L/C Issuer relating to letters of credit as from time to time in
effect.  Such customary fees and standard costs and charges are due and payable
on demand and are nonrefundable.

2.11.3      Other Fees.  Borrower shall pay to Administrative Agent, for its own
account, for the account of the L/C Issuer or for the account of the Lenders, as
applicable, such other fees as are required by the engagement letter, dated
November 2, 2009, between Borrower and Administrative Agent (the “Engagement
Letter”).

2.12         Computation of Fees and Interest.  All computations of interest and
fees under this Agreement shall be made on the basis of a 360-day year and
actual days elapsed, which results in more interest or fees being paid than if
computed on the basis of a 365-day year.  Interest and fees shall accrue during
each period during which interest or such fees are computed from the first day
thereof to the last day thereof.  Any change in the interest rate on a Loan
resulting from a change in the Reference Rate or the applicable reserve
requirement, deposit insurance assessment rate or other regulatory cost shall
become effective as of the opening of business on the day on which such change
in the Reference Rate or such reserve requirement, assessment rate or other
regulatory cost becomes effective.  Each determination of an interest rate by
Administrative Agent pursuant to any provision of this Agreement shall be
conclusive and binding on Borrower and the Lenders in the absence of manifest
error.

2.13         Payments by Borrower.

2.13.1      Timing of Payments.  All payments (including prepayments) made by
Borrower on account of principal, interest, fees and other amounts required
hereunder shall be made without set-off or counterclaim.  All such payments
(other than payments on Swing Loans) shall, except as otherwise expressly
provided herein, be made to Administrative Agent for the account of the Lenders
at Agent’s Payment Office, in dollars and in immediately available funds, no
later than 2:00 p.m. on the date specified herein.  All payments in respect of
Swing Loans shall be paid to Administrative Agent for the account of the Swing
Line Lender and shall be paid in dollars and in immediately available funds, no
later than 2:00 p.m. on the date specified herein.  Any payment received by
Administrative Agent later than 2:00 p.m. shall be deemed to have been received
on the immediately succeeding Business Day and any applicable interest or fee
shall continue to accrue.  Administrative Agent will promptly (and in any event,
not later than two Business Days after Administrative Agent’s actual receipt)
distribute to each Lender its Pro Rata Share (or other applicable share as
provided herein) of such payment in like funds as received; provided, however,
if and to the extent Administrative Agent shall receive any such payment for the
account of Lenders on or before 2:00 p.m. on any Business Day and Administrative
Agent shall not have distributed to each Lender its Pro Rata Share (or other
applicable share as provided herein) on such Business Day, the distribution to
each Lender when made shall include interest at the Federal Funds Rate for each
day from the date of Administrative Agent’s actual receipt of such payment from
Borrower until the date Administrative Agent distributes to each Lender its Pro
Rata Share (or other applicable share as provided herein).

 
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2.13.2      Non-Business Days.  Subject to the provisions set forth in the
definition of the term “Interest Period.” whenever any payment hereunder is
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of interest or fees, as the case may be.

2.13.3      Payment May be Made by Administrative Agent.  Unless Administrative
Agent shall have received notice from Borrower prior to the date on which any
payment is due to Administrative Agent for the account of the Lenders or the L/C
Issuer hereunder that Borrower will not make such payment.  Administrative Agent
may assume that Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
the L/C Issuer, as the case may be, the amount due.  In such event, if Borrower
has not in fact made such payment, then each of the Lenders or the L/C Issuer,
as the case may be, severally agrees to repay to Administrative Agent forthwith
on demand the amount so distributed to such Lender or the L/C Issuer, in
immediately available funds with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to Administrative Agent, at the greater of the Federal Funds Rate and a
rate determined by Administrative Agent in accordance with banking industry
rules on interbank compensation.  A notice of Administrative Agent to any Lender
or Borrower with respect to any amount owing under this Section 2.13.3 shall be
conclusive, absent manifest error.

2.14         Payments by the Lenders to Administrative Agent.

2.14.1       Administrative Agent May Make Borrowings Available.  With respect
to any Borrowing, unless Administrative Agent receives notice from a Lender at
least one Business Day prior to the date of such Borrowing, that such Lender
will not make available to Administrative Agent, for the account of Borrower,
the amount of that Lender’s Pro Rata Share of the Borrowing as and when required
hereunder, Administrative Agent may assume that each Lender has made such amount
available to Administrative Agent in immediately available funds on the
Borrowing date and Administrative Agent may (but shall not be so required), in
reliance upon such assumption, make available to Borrower on such date a
corresponding amount.  In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to Administrative Agent, then the
applicable Lender and Borrower severally agree to pay to Administrative Agent
forthwith on demand such corresponding amount in immediately available funds
with interest thereon, for each day from and including the date such amount is
made available to Borrower to but excluding the date of payment to
Administrative Agent, at (a) in the case of a payment to be made by such Lender,
the greater of the Federal Funds Rate and a rate determined by Administrative
Agent in accordance with banking industry rules on interbank compensation and
(b) in the case of a payment to be made by Borrower, the interest rate
applicable to Reference Rate Loans.  If Borrower and such Lender shall pay such
interest to Administrative Agent for the same or an overlapping period,
Administrative Agent shall promptly remit to Borrower the amount of such
interest paid by Borrower for such period.  If such Lender pays its share of the
applicable Borrowing to Administrative Agent, then the amount so paid shall
constitute such Lender’s Loan included in such Borrowing.  Any payment by
Borrower shall be without prejudice to any claim Borrower may have against a
Lender that shall have failed to make such payment to Administrative Agent.  A
notice of Administrative Agent to any Lender or Borrower with respect to any
amount owing under this Section 2.14.1 shall be conclusive, absent manifest
error.

 
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2.14.2      Obligations of Lenders Several.  The obligations of the Lenders
hereunder to make Loans, to fund participations in Letters of Credit and Swing
Loans and to make payments pursuant to Section 10.4(c) are several and not
joint.  The failure of any Lender to make any Loan, to fund any such
participation or to make any payment under Section 10.4(c) on any date required
hereunder shall not relieve any other Lender of its corresponding obligation to
do so on such date.  No Lender shall be responsible for the failure of any other
Lender to so make its Loan, to purchase its participation or to make its payment
under Section 10.4(c).

2.14.3      Failure to Satisfy Conditions Precedent.  If any Lender makes
available to Administrative Agent funds for any Loan to be made by such Lender
as provided in the foregoing provisions of this Article 2, and such funds are
not made available to Borrower by Administrative Agent because the conditions to
the applicable credit extension set forth in Article 5 are not satisfied or
waived in accordance with the terms hereof, Administrative Agent shall return
such funds (in like funds as received from such Lender) to such Lender, without
interest.

2.14.4      Funding Source.  Nothing herein shall be deemed to obligate any
Lender to obtain the funds for any Loan in any particular place or manner or to
constitute a representation by any Lender that it has obtained or will obtain
the funds for any Loan in any particular place or manner.

2.15         Sharing of Payments, Etc.  If any Lender shall, by exercising any
right of setoff or counterclaim or otherwise, obtain payment in respect of any
principal of or interest on any of the Loans made by it, or the participations
in L/C Obligations or in Swing Loans held by it resulting in such Lender’s
receiving payment of a proportion of the aggregate amount of such Loans or
participations and accrued interest thereon greater than its Pro Rata Share
thereof as provided herein, then the Lender receiving such greater proportion
shall (a) notify Administrative Agent of such fact, and (b) purchase (for cash
at face value) participations in the Loans and subparticipations in L/C
Obligations and Swing Loans of the other Lenders, or make such other adjustments
as shall be equitable, so that the benefit of all such payments shall be shared
by the Lenders ratably in accordance with the aggregate amount of principal of
and accrued interest on their respective Loans and other amounts owing them,
provided that: (i) if any such participations or subparticipations are purchased
and all or any portion of the payment giving rise thereto is recovered, such
participations or subparticipations shall be rescinded and the purchase price
restored to the extent of such recovery, without interest; and (ii) the
provisions of this Section shall not be construed to apply to (x) any payment
made by Borrower pursuant to and in accordance with the express terms of this
Agreement, or (y) any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or
subparticipations in L/C Obligations or Swing Loans to any assignee or
participant, other than to Borrower or any subsidiary thereof (as to which the
provisions of this Section shall apply).

 
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2.16         Defaulting Lender.

2.16.1      Notice and Cure of Lender Default; Election Period; Electing
Lenders.  Administrative Agent shall promptly notify (such notice being referred
to as the “Defaulting Lender Notice”) Borrower and each non-Defaulting Lender if
any Lender is a Defaulting Lender.  Each non-Defaulting Lender shall have the
right, but in no event or under any circumstance the obligation, to fund any
amount that a Defaulting Lender fails to fund (the “Defaulting Lender Amount”),
provided that, within 20 days after the date of the Defaulting Lender Notice
(the “Election Period”), such non-Defaulting Lender or Lenders (each such
Lender, an “Electing Lender”) irrevocably commit(s) by notice in writing (an
“Election Notice”) to Administrative Agent, the other Lenders and Borrower to
fund the Defaulting Lender Amount.  If Administrative Agent receives more than
one Election Notice within the Election Period, then the commitment to fund the
Defaulting Lender Amount shall be apportioned pro rata among the Electing
Lenders in the proportion that the amount of each such Electing Lender’s
Commitment bears to the total Commitments of all Electing Lenders.  If the
Defaulting Lender fails to pay the Defaulting Lender Amount within the Election
Period, (a) the Electing Lender or Lenders, as applicable, shall be
automatically obligated to fund the Defaulting Lender Amount (and Defaulting
Lender shall no longer be entitled to fund such Defaulting Lender Amount) within
three Business Days after such notice to Administrative Agent, which Defaulting
Lender Amount shall be applied towards reimbursement to Administrative Agent or
payment to Borrower as applicable, and (b) Borrower may enforce any rights it
may have under this Agreement, at law or in equity, against Defaulting
Lender.  Notwithstanding any contrary provision of this Agreement, if
Administrative Agent has funded the Defaulting Lender Amount.  Administrative
Agent shall be entitled to reimbursement from the Electing Lenders for its
portion of the Defaulting Lender Amount.

2.16.2      Removal of Rights: Indemnity.  Administrative Agent shall not be
obligated to transfer to a Defaulting Lender any payments made by or on behalf
of Borrower to Administrative Agent for the Defaulting Lender’s benefit; nor
shall a Defaulting Lender be entitled to the sharing of any payments hereunder
or under any Note until all Defaulting Lender Amounts are paid in
full.  Administrative Agent shall hold all such payments received or retained by
it for the account of such Defaulting Lender.  Amounts payable to a Defaulting
Lender shall be paid by Administrative Agent to reimburse Administrative Agent
and any Electing Lender pro rata for all Defaulting Lender Amounts funded by
such Persons.  Solely for the purposes of voting or consenting to matters with
respect to the Loan Documents, a Defaulting Lender shall be deemed not to be a
“Lender” and such Defaulting Lender’s Commitment shall be deemed to be zero.  A
Defaulting Lender shall have no right to participate in any discussions among
and/or decisions by Lenders hereunder and/or under the other Loan
Documents.  This Section shall remain effective with respect to a Defaulting
Lender until such time as the Defaulting Lender shall no longer be in default of
any of its obligations under this Agreement by curing such default by payment of
all Defaulting Lender Amounts (a) within the Election Period, or (b) after the
Election Period with the consent of the non-Defaulting Lenders.  Such Defaulting
Lender nonetheless shall be bound by any amendment to, or waiver of, any
provision of, or any action taken or omitted to be taken by Administrative Agent
and/or the non-Defaulting Lenders under, any Loan Document which is made
subsequent to the Defaulting Lender’s becoming a Defaulting Lender and prior to
such cure or waiver.  The operation of this Section or the Section above alone
shall not be construed to increase or otherwise affect the Commitment of any
non-Defaulting Lender, or to relieve or excuse the performance by Borrower of
its duties and obligations hereunder or under any of the other Loan
Documents.  Furthermore, nothing contained in this Section shall release or in
any way limit a Defaulting Lender’s obligations as a Lender hereunder and/or
under any other of the Loan Documents.  Further, a Defaulting Lender shall
indemnify and hold harmless Administrative Agent and each of the non-Defaulting
Lenders from any claim, loss, or costs incurred by Administrative Agent and/or
the non-Defaulting Lenders as a result of a Defaulting Lender’s failure to
comply with the requirements of this Agreement, including any and all additional
losses, damages, costs and expenses (including attorneys’ fees) incurred by
Administrative Agent and any non-Defaulting Lender as a result of and/or in
connection with (i) a non-Defaulting Lender’s acting as an Electing Lender, (ii)
any enforcement action brought by Administrative Agent against a Defaulting
Lender, and (iii) any action brought against Administrative Agent and/or
Lenders.  The indemnification provided above shall survive any termination of
this Agreement.

 
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2.16.3      Commitment Adjustments.  In connection with the adjustment of the
amounts of the Commitments of the Defaulting Lender and Electing Lender(s) upon
the expiration of the Election Period described above, Borrower, Administrative
Agent and Lenders shall execute such modifications to the Loan Documents as
shall, in the reasonable judgment of Administrative Agent, be necessary or
desirable in connection with the adjustment of the amounts of Commitments in
accordance with the foregoing provisions of this Section.  For the purpose of
voting or consenting to matters with respect to the Loan Documents such
modifications shall also reflect the removal of voting rights of the Defaulting
Lender and increase in voting rights of Electing Lenders to the extent an
Electing Lender has funded the Defaulting Lender Amount.  In connection with
such adjustments, each Defaulting Lender shall execute and deliver an Assignment
and Assumption covering that Lender’s Commitment and otherwise comply with
Section 10.5.  If a Lender refuses to execute and deliver such Assignment and
Assumption or otherwise comply with Section 10.5, such Lender hereby appoints
Administrative Agent to do so on such Lender’s behalf.  Administrative Agent
shall distribute an amended schedule of Lenders, which shall thereafter be
incorporated into this Agreement, to reflect such adjustments.  However, all
such Defaulting Lender Amounts funded by Administrative Agent or Electing
Lenders shall continue to be Defaulting Lender Amounts of the Defaulting Lender
pursuant to its obligations under this Agreement.

2.16.4      No Election.  In the event that no Lender elects to commit to fund a
Defaulting Lender Amount within the applicable Election Period, Administrative
Agent shall, upon the expiration of such Election Period, so notify Borrower and
each Lender.

 
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3.
TAXES, YIELD PROTECTION AND ILLEGALITY.

3.1           Taxes.

3.1.1        Payments Free of Taxes.  Any and all payments by or on account of
any obligation of Borrower hereunder or under any other Loan Document shall be
made free and clear of and without reduction or withholding for any Indemnified
Taxes or Other Taxes, provided that if Borrower shall be required by applicable
Law to deduct any Indemnified Taxes (including any Other Taxes) from such
payments, then (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 3.1) Administrative Agent, Lender or L/C Issuer,
as the case may be, receives an amount equal to the sum it would have received
had no such deductions been made, (ii) Borrower shall make such deductions, and
(iii) Borrower shall timely pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable Law.

3.1.2        Payment of Other Taxes by Borrower.  Without limiting the
provisions of Section 3.1.1 above, Borrower shall timely pay any Other Taxes to
the relevant Governmental Authority in accordance with applicable Law.

3.1.3        Indemnification by Borrower.  Borrower shall indemnify
Administrative Agent, each Lender and the L/C Issuer, within 10 days after
demand therefor, for the full amount of any Indemnified Taxes or Other Taxes
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) paid by Administrative
Agent, such Lender or the L/C Issuer, as the case may be, and any penalties,
interest and reasonable expenses arising therefrom or with respect thereto,
whether or not such Indemnified Taxes or Other Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority.  A certificate as to
the amount of such payment or liability delivered to Borrower by a Lender or the
L/C Issuer (with a copy to Administrative Agent), or by Administrative Agent on
its own behalf or on behalf of a Lender or the L/C Issuer, shall be conclusive
absent manifest error.

3.1.4        Evidence of Payments.  As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by Borrower to a Governmental Authority,
Borrower shall deliver to Administrative Agent the original or a certified copy
of a receipt issued by such Governmental Authority evidencing such payment, a
copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to Administrative Agent.

3.1.5        Status of Lenders.  Any Foreign Lender that is entitled to an
exemption from or reduction of withholding tax under the law of the jurisdiction
in which Borrower is resident for tax purposes, or any treaty to which such
jurisdiction is a party, with respect to payments hereunder or under any other
Loan Document shall deliver to Borrower (with a copy to Administrative Agent),
at the time or times prescribed by applicable Law or reasonably requested by
Borrower or Administrative Agent, such properly completed and executed
documentation prescribed by applicable Law as will permit such payments to be
made without withholding or at a reduced rate of withholding.  In addition, any
Lender, if requested by Borrower or Administrative Agent, shall deliver such
other documentation prescribed by applicable Law or reasonably requested by
Borrower or Administrative Agent as will enable Borrower or Administrative Agent
to determine whether or not such Lender is subject to backup withholding or
information reporting requirements.  Without limiting the generality of the
foregoing, in the event that Borrower is resident for tax purposes in the United
States, any Foreign Lender shall deliver to Borrower and Administrative Agent
(in such number of copies as shall be requested by the recipient) on or prior to
the date on which such Foreign Lender becomes a Lender under this Agreement (and
from time to time thereafter upon the request of Borrower or Administrative
Agent, but only if such Foreign Lender is legally entitled to do so), whichever
of the following is applicable: (i) duly completed copies of Internal Revenue
Service Form W-8BEN claiming eligibility for benefits of an income tax treaty to
which the United States is a party, (ii) duly completed copies of Internal
Revenue Service Form W-8ECI, (iii) in the case of a Foreign Lender claiming the
benefits of the exemption for portfolio interest under Section 881(c) of the
Code, (x) a certificate to the effect that such Foreign Lender is not (A) a
“bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent
shareholder” of Borrower within the meaning of Section 881(c)(3)(B) of the Code,
or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C) of
the Code and (y) duly completed copies of Internal Revenue Service Form W-8BEN,
or (iv) any other form prescribed by applicable Law as a basis for claiming
exemption from or a reduction in United States Federal withholding tax duly
completed together with such supplementary documentation as may be prescribed by
applicable Law to permit Borrower to determine the withholding or deduction
required to be made.

 
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3.1.6        Treatment of Certain Refunds.  If Administrative Agent, any Lender
or the L/C Issuer determines, in its sole discretion, that it has received a
refund of any Taxes or Other Taxes as to which it has been indemnified by
Borrower or with respect to which Borrower has paid additional amounts pursuant
to this Section, it shall pay to Borrower an amount equal to such refund (but
only to the extent of indemnity payments made, or additional amounts paid, by
Borrower under this Section 3.1 with respect to the Taxes or Other Taxes giving
rise to such refund), net of all reasonable out-of-pocket expenses of
Administrative Agent, such Lender or the L/C Issuer, as the case may be, and
without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund), provided that Borrower, upon the request
of Administrative Agent, such Lender or the L/C Issuer, agrees to repay the
amount paid over to Borrower (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to Administrative Agent, such
Lender or the L/C Issuer in the event Administrative Agent, such Lender or the
L/C Issuer is required to repay such refund to such Governmental
Authority.  This subsection shall not be construed to require Administrative
Agent, any Lender or the L/C Issuer to make available its tax returns (or any
other information relating to its taxes that it deems confidential) to Borrower
or any other Person.

3.2           Illegality.  If any Lender determines that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund LIBOR
Loans, or to determine or charge interest rates based upon the LIBOR Base Rate,
or any Governmental Authority has imposed material restrictions on the authority
of such Lender to purchase or sell, or to take deposits of, dollars in the
London interbank market, then, on notice thereof by such Lender to Borrower
through Administrative Agent (a “LIBOR Suspension Notice”), any obligation of
such Lender to make or continue LIBOR Loans or to convert Reference Rate Loans
to LIBOR Loans shall be suspended until such Lender notifies Administrative
Agent and Borrower that the circumstances giving rise to such determination no
longer exist.  Upon receipt of such LIBOR Suspension Notice, Borrower shall,
upon demand from such Lender (with a copy to Administrative Agent), repay,
prepay or, if applicable, convert all LIBOR Loans of such Lender to Reference
Rate Loans, either on the last day of the Interest Period therefor, if such
Lender may lawfully continue to maintain such LIBOR Loans to such day, or
immediately, if such Lender may not lawfully continue to maintain such LIBOR
Loans.  Upon any such prepayment or conversion, Borrower shall also pay accrued
interest on the amount so prepaid or converted.  Delivery of a LIBOR Suspension
Notice shall not affect the obligation of any other Lender to make, maintain and
fund LIBOR Loans under the terms of this Agreement, unless such other Lender
also delivers a LIBOR Suspension Notice under this Section 3.2.

 
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3.3           Increased Costs.

3.3.1        Increased Costs Generally.  If any Change in Law shall: (i) impose,
modify or deem applicable any reserve, special deposit, compulsory loan,
insurance charge or similar requirement against assets of, deposits with or for
the account of, or credit extended or participated in by, any Lender (except any
reserve requirement reflected in the LIBOR Rate) or the L/C Issuer; (ii) subject
any Lender or the L/C Issuer to any tax of any kind whatsoever with respect to
this Agreement, any Letter of Credit, any participation in a Letter of Credit or
any LIBOR Loan made by it, or change the basis of taxation of payments to such
Lender or the L/C Issuer in respect thereof (except for Indemnified Taxes or
Other Taxes covered by Section 3.1 and the imposition of, or any change in the
rate of, any Excluded Tax payable by such Lender or the L/C Issuer); or (iii)
impose on any Lender or the L/C Issuer or the London interbank market any other
condition, cost or expense affecting this Agreement or LIBOR Loans made by such
Lender or any Letter of Credit or participation therein; and the result of any
of the foregoing shall be to increase the cost to such Lender of making or
maintaining any LIBOR Loan (or of maintaining its obligation to make any such
Loan), or to increase the cost to such Lender or the L/C Issuer of participating
in, issuing or maintaining any Letter of Credit (or of maintaining its
obligation to participate in or to issue any Letter of Credit), or to reduce the
amount of any sum received or receivable by such Lender or the L/C Issuer
hereunder (whether of principal, interest or any other amount) then, upon
request of such Lender or the L/C Issuer, Borrower will pay to such Lender or
the L/C Issuer, as the case may be, such additional amount or amounts as will
compensate such Lender or the L/C Issuer, as the case may be, for such
additional costs incurred or reduction suffered.

3.3.2        Capital Requirements.  If any Lender or the L/C Issuer determines
that any Change in Law affecting such Lender or the L/C Issuer or any Lending
Office of such Lender or such Lender’s or the L/C Issuer’s holding company, if
any, regarding capital requirements has or would have the effect of reducing the
rate of return on such Lender’s or the L/C Issuer’s capital or on the capital of
such Lender’s or the L/C Issuer’s holding company, if any, as a consequence of
this Agreement, the Commitments of such Lender or the Loans made by, or
participations in Letters of Credit held by, such Lender, or the Letters of
Credit issued by the L/C Issuer, to a level below that which such Lender or the
L/C Issuer or such Lender’s or the L/C Issuer’s holding company could have
achieved but for such Change in Law (taking into consideration such Lender’s or
the L/C Issuer’s policies and the policies of such Lender’s or the L/C Issuer’s
holding company with respect to capital adequacy), then from time to time
Borrower will pay to such Lender or the L/C Issuer, as the case may be, such
additional amount or amounts as will compensate such Lender or the L/C Issuer or
such Lender’s or the L/C Issuer’s holding company for any such reduction
suffered.

 
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3.3.3        Delay in Requests.  Failure or delay on the part of any Lender or
the L/C Issuer to demand compensation pursuant to the foregoing provisions of
this Section 3 shall not constitute a waiver of such Lender’s or the L/C
Issuer’s right to demand such compensation, provided that Borrower shall not be
required to compensate a Lender or the L/C Issuer pursuant to the foregoing
provisions of this Section 3 for any increased costs incurred or reductions
suffered more than three months prior to the date that such Lender or the L/C
Issuer, as the case may be, notifies Borrower in writing of the Change in Law
giving rise to such increased costs or reductions and of such Lender’s or the
L/C Issuer’s intention to claim compensation therefor (except that, if the
Change in Law giving rise to such increased costs or reductions is retroactive,
then the three-month period referred to above shall be extended to include the
period of retroactive effect thereof).

3.4           Funding Losses.  Borrower agrees to pay to Administrative Agent,
from time to time, for the account of the Lenders, any amount that would be
necessary to reimburse the Lenders for, and to hold the Lenders harmless from,
any loss or expense which the Lenders may reasonably sustain or incur as a
consequence of:

(a)           the failure of Borrower to make any required payment or prepayment
of principal of any LIBOR Loan (including payments made after any acceleration
thereof);

(b)           the failure of Borrower to borrow, continue or convert a Loan
after Borrower has given a Notice of Borrowing or Conversion/Continuation;

(c)           the failure of Borrower to make any prepayment after Borrower has
given a notice in accordance with Section 2.8.1;

(d)           the prepayment (including pursuant to Section 2.8.2) of a LIBOR
Loan on a day which is not the last day of the Interest Period with respect
thereto;

(e)           the conversion pursuant to Section 2.6 of any LIBOR Loan to a
Reference Rate Loan on a day that is not the last day of the respective Interest
Period; or

(f)           any assignment of a LIBOR Loan on a day other than the last day of
the Interest Period therefor as a result of a request by the Borrower pursuant
to Section 10.13;

including any such loss or expense arising from the liquidation or reemployment
of funds obtained to maintain the LIBOR Loans hereunder or from fees payable to
terminate the deposits from which such funds were obtained.  Solely for purposes
of calculating amounts payable by Borrower to Administrative Agent, for the
account of Lenders, under this Section 3.4, each LIBOR Loan (and each related
reserve, special deposit or similar requirement) shall be conclusively deemed to
have been funded at the rate of interest used to determine such LIBOR Loan by a
matching deposit or other borrowing in the London interbank eurodollar market
for a comparable amount and for a comparable period, whether or not such LIBOR
Loan is in fact so funded.

 
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3.5           Inability to Determine Rates.  If the Required Lenders determine
that for any reason in connection with any request for a LIBOR Loan or a
conversion to or continuation thereof that (a) dollar deposits are not being
offered to banks in the London interbank eurodollar market for the applicable
amount and Interest Period of such LIBOR Loan, (b) adequate and reasonable means
do not exist for determining the LIBOR Base Rate for any requested Interest
Period with respect to a proposed LIBOR Loan, or (c) the LIBOR Base Rate for any
requested Interest Period with respect to a proposed LIBOR Loan does not
adequately and fairly reflect the cost to such Lenders of funding such Loan,
Administrative Agent will promptly so notify Borrower and each
Lender.  Thereafter, the obligation of the Lenders to make or maintain LIBOR
Loans shall be suspended until Administrative Agent (upon the instruction of the
Required Lenders) revokes such notice.  Upon receipt of such notice, Borrower
may revoke any pending request for a Borrowing of, conversion to or continuation
of LIBOR Loans or, failing that, will be deemed to have converted such request
into a request for a Borrowing of Reference Rate Loans in the amount specified
therein.

3.6           Certificate of Lender.  Any Lender or the L/C Issuer if claiming
reimbursement or compensation pursuant to this Article 3, shall deliver to
Borrower through Administrative Agent a certificate setting forth in reasonable
detail the amount payable to such Lender or the L/C Issuer, or its holding
company, as the case may be, hereunder, and such certificate shall be conclusive
absent manifest error.  Borrower shall pay such Lender or the L/C Issuer, as the
case may be, the amount shown as due on any such certificate within 10 days
after receipt thereof.

3.7           Mitigation Obligations; Replacement of Lenders.

(a)           Designation of a Different Lending Office.  If any Lender requests
compensation under Section 3.3, or Borrower is required to pay any additional
amount to any Lender or any Governmental Authority for the account of any Lender
pursuant to Section 3.1, or if any Lender gives a notice pursuant to Section
3.2, then such Lender shall use reasonable efforts to designate a different
Lending Office for funding or booking its Loans hereunder or to assign its
rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to Section 3.1 or 3.3, as
the case may be, in the future, or eliminate the need for the notice pursuant to
Section 3.2, as applicable, and (ii) in each case, would not subject such Lender
to any unreimbursed cost or expense and would not otherwise be disadvantageous
to such Lender.  Borrower hereby agrees to pay all reasonable costs and expenses
incurred by any Lender in connection with any such designation or assignment.

(b)           Replacement of Lenders.  If any Lender requests compensation under
Section 3.3, or if Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 3.1, Borrower may replace such Lender in accordance with Section 10.13.

3.8           Survival.  The agreements and obligations of Borrower in this
Article 3 shall survive the payment and performance of all other Obligations for
a period of four (4) years after the Maturity Date.

 
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4.
UNENCUMBERED ASSET POOL.

4.1           Additions of Property to the Unencumbered Asset Pool.

(a)           In addition to the real property described in Exhibits A-l and A-2
attached hereto, Borrower may from time to time request that Administrative
Agent add a new property (a “Nominated Property”) to the Unencumbered Asset
Pool, as follows.

(i)            To become an Unencumbered Stabilized Asset Property, a Nominated
Property must satisfy each of the following conditions:

(1)           Borrower or a Permitted Affiliate shall hold fee simple title to
such Nominated Property or such Nominated Property is subject to a financeable
ground lease (as determined by Administrative Agent in its reasonable
discretion) in compliance with the second sentence of Section 4.1(c) and such
Nominated Property shall be located in the United States;

(2)           Such Nominated Property is operated as residential apartments,
with no more than 20% of gross revenue generated by non-residential tenants;

(3)           Such Nominated Property shall have minimum occupancy of 70%, and
if admitted to the pool of Unencumbered Stabilized Asset Properties, would not
cause the aggregate occupancy of the Unencumbered Stabilized Asset Properties to
be less than 85%;

(4)           If requested by Administrative Agent, Borrower shall have
delivered to Administrative Agent a copy of a Phase I environmental site
assessment for such Nominated Property, in form and substance reasonably
acceptable to Administrative Agent and prepared within one year of its delivery,
and such environmental site assessment (i) shall not disclose the presence of
any material toxic or Hazardous Substances on the Nominated Property (other than
asbestos or asbestos containing materials (“ACM”) or Hazardous Substances used
for cleaning, pool and other chemicals typically located on residential
properties that are otherwise consistent with all applicable Laws); and (ii) if
such environmental site assessment discloses the presence of asbestos or ACM on
the Nominated Property, all such asbestos or ACM shall be in a condition
reasonably acceptable to Administrative Agent, shall be subject to an O&M Plan
reasonably acceptable to Administrative Agent, and Borrower or a Permitted
Affiliate, as applicable, shall be performing its obligations under such O&M
Plan in a manner reasonably acceptable to Administrative Agent;

(5)           Such Nominated Property shall be free of all liens, encumbrances
and negative pledges, except for the following permitted liens (“Permitted
Liens”):  (i) liens for taxes, assessments or governmental charges or levies to
the extent that Borrower or a Permitted Affiliate is not yet required to pay the
amount secured thereby; and (ii) liens imposed by law, such as carrier’s,
warehouseman’s, mechanic’s, materialman’s and other similar liens, arising in
the ordinary course of business in respect of obligations that are not overdue
or are being actively contested in good faith by appropriate proceedings and in
compliance with Section 6.14(c) hereof, as long as Borrower or a Permitted
Affiliate, as applicable, has established and maintained adequate reserves for
the payment of the same and, by reason of nonpayment, no property of Borrower or
a Permitted Affiliate, as applicable, is in danger of being lost or forfeited;
and (iii) easements; covenants, conditions and restrictions; reciprocal easement
and access agreements and similar agreements relating to ownership and
operation; and

 
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(6)           The portion of the Unencumbered Asset Pool Value attributable to
such Nominated Property shall not exceed twenty percent (20%).

(ii)           To become an Unencumbered Development Property, a Nominated
Property must satisfy each of the following conditions:

(1)           Borrower or a Permitted Affiliate shall hold fee simple title to
such Nominated Property or such Nominated Property is subject to a financeable
ground lease (as determined by Administrative Agent in its reasonable
discretion) in compliance with the second sentence of Section 4.1(c) and such
Nominated Property shall be located in the United States;

(2)           Such Nominated Property is real property comprised of residential
apartment projects under development, with no more than 20% of the pro forma
revenue of such development expected to be generated by non-residential tenants,
or in pre-construction phases of the development process, but Completion of
Construction has not occurred or did not occur within the prior 12-month period;

(3)           If requested by Administrative Agent, Borrower shall have
delivered to Administrative Agent a copy of a Phase I environmental site
assessment for such Nominated Property as described in paragraph (4) of clause
(i) above;

(4)           Such Nominated Property shall be free of all liens, encumbrances
and negative pledges, except for Permitted Liens as described in paragraph (5)
of clause (i) above;

(5)           Upon the addition of such Nominated Property as an Unencumbered
Development of Property, no more than 25% (or 20% if at such time Guarantor has
less than a BBB- or Baa3 (as applicable) credit rating from S&P or Moody’s) of
the Unencumbered Asset Pool Value may be attributable to Unencumbered
Development Property in the aggregate; and

(6)           The portion of the Unencumbered Asset Pool Value attributable to
such Nominated Property shall not exceed twenty percent (20%).

Notwithstanding the foregoing, such Nominated Property shall no longer qualify
as an Unencumbered Development Property on the date that is the earlier of (A)
twelve months following the date that Completion of Construction on such
Nominated Property has occurred, or (B) the first fiscal quarter in which such
Nominated Property becomes an Unencumbered Stabilized Asset Property.  In
addition, if the Unencumbered Development Property Value at any time exceeds 25%
of the Unencumbered Asset Pool Value (or 20%, if Guarantor at any time has less
than a BBB- or Baa3 (as applicable) credit rating from S&P or Moody’s),
sufficient Unencumbered Development Property shall be removed from the
Unencumbered Asset Pool under Sections 4.1(b) or (c) below such that the
Unencumbered Development Property Value at any time is equal to or less than 25%
(or 20%, if applicable) of the Unencumbered Asset Pool Value.

 
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(iii)          Nominated Properties that satisfy all of the foregoing conditions
in the foregoing clause (i) or (ii), as applicable, subject to Section 4.2, will
automatically become Unencumbered Asset Pool Properties so long as Guarantor has
a BBB- or Baa3 (as applicable) or better credit rating from S&P or Moody’s at
the time such conditions are satisfied.  If Guarantor’s credit rating is less
than BBB- or Baa3 (as applicable), Nominated Properties will become Unencumbered
Asset Pool Properties at the sole and absolute discretion of the Required
Lenders.

(b)           Borrower may, at its option, elect to remove an Unencumbered Asset
Pool Property from the Unencumbered Asset Pool, from time to time, including
when such property is sold, disposed of, or no longer meets the qualifications
of an Unencumbered Asset Pool Property.  When (i) an Unencumbered Asset Pool
Property is removed from the Unencumbered Asset Pool and Borrower continues to
own the property, on or before the removal of the Unencumbered Asset Pool
Property from the Unencumbered Asset Pool, Borrower shall deliver to
Administrative Agent a written notice, setting forth the identity of the
Unencumbered Asset Pool Property to be removed and the requested date of
removal; and (ii) an Unencumbered Asset Pool Property is removed from the
Unencumbered Asset Pool and Borrower no longer has ownership of the property,
within five Business Days after such Unencumbered Asset Pool Property is sold or
disposed of, Borrower shall deliver to Administrative Agent a written notice,
setting forth the identity of the Unencumbered Asset Pool Property that has been
removed and the date of removal (which date shall be deemed to be the date that
Borrower no longer had ownership of such property).  Pursuant to the foregoing
clauses (i) and (ii), with such notice, Borrower shall also deliver a compliance
certificate, substantially similar to the form of Exhibit D (a “Compliance
Certificate”), signed and certified by an authorized financial officer of
Borrower (A) setting forth the information and computations (in sufficient
detail) to determine the Unencumbered Asset Pool Value after such removal; (B)
provided from information based upon the most recently delivered financial
statements under Section 6.3 hereof, establishing that, on a pro-forma basis as
if such Unencumbered Asset Pool Property had been removed from the Unencumbered
Asset Pool before the end of the reporting period under such financial
statements, Borrower would be in compliance with all financial covenants set
forth in this Agreement following such removal as of the date of such financial
statements; (C) stating specifically that the aggregate Outstanding Amount of
Loans and Swing Loans plus the Outstanding Amount of L/C Obligations after such
removal will be less than or equal to the Availability; (D) stating specifically
that the Unencumbered Development Property Value does not exceed 25% of the
Unencumbered Asset Pool Value (or 20% of the Unencumbered Asset Pool Value at
such time that Guarantor has less than a BBB- or Baa3 (as applicable) credit
rating from S&P or Moody’s); and (E) setting forth whether there exists or to
the best of Borrower’s knowledge as of the date of such removal there will
exist, any Default or Event of Default and, if any such Default or Event of
Default exists, specifying the nature thereof and the action Borrower is taking
and proposes to take with respect thereto.  At the time of any such removal,
Borrower shall pay Administrative Agent all reasonable attorneys’ fees
(including fees for in-house counsel) incurred by Administrative Agent in
connection with removing the property from the Unencumbered Asset Pool and shall
make any payments to continue compliance with the terms of this Agreement,
including those relating to the requirement that the aggregate Outstanding
Amount of Loans and Swing Loans plus the Outstanding Amount of L/C Obligations
not exceed the Availability, necessary as a result of the requested removal.

 
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(c)           If the Unencumbered Asset Pool as a whole fails to meet any of the
conditions set forth in Section 4.1(a)(i) or Section 4.1(a)(ii), as applicable
(including the condition that the Unencumbered Development Property Value does
not at any time exceed 25% of the Unencumbered Asset Pool Value), and any one of
two or more properties might be removed to maintain compliance of the
Unencumbered Asset Pool as a whole with the such conditions, then Borrower shall
select the property or properties to be removed, provided that if it does not do
so within ten days of written request to do so from Administrative Agent, then
Administrative Agent may in its sole discretion select the property or
properties to remove and so remove them.  Notwithstanding the foregoing, any
property subject to a financeable ground lease (as determined by Administrative
Agent in its reasonable discretion) in excess of 30 years (provided that no less
than 15 years shall be remaining on such ground lease), shall not cease to be an
Unencumbered Stabilized Asset Property solely because that property has been
acquired by ground lease and not by fee simple.  At the time of any such
removal, Borrower shall pay Administrative Agent all reasonable attorneys’ fees
(including fees for in-house counsel) incurred by Administrative Agent in
connection with removing the property from the Unencumbered Asset Pool, and
shall make any payments to continue compliance with the terms of this Agreement,
including but not limited to those relating to the requirement that the
aggregate Outstanding Amount of Loans and Swing Loans plus the Outstanding
Amount of L/C Obligations not exceed the Availability, necessary as a result of
such removal.

4.2           Delivery of Information.  In connection with each request to add a
Nominated Property to the Unencumbered Asset Pool, Borrower will submit to
Administrative Agent all of the following information and documentation:

(a)           if requested in writing by Administrative Agent, a current Phase I
environmental site assessment for such Nominated Property addressed to Borrower
or a Permitted Affiliate, as applicable; provided, however, that in any event
Borrower shall not be required to resubmit a Phase I environmental site
assessment to Administrative Agent for any Unencumbered Stabilized Asset
Property listed on Exhibit A-l attached hereto.

(b)           a title insurance policy insuring Borrower’s or a Permitted
Affiliate’s fee title to (or financeable leasehold in) such Nominated Property
free of any Liens, except for Permitted Liens, and a current title report with
respect to such Nominated Property; provided, however, Borrower shall not be
required to resubmit a title insurance policy to Administrative Agent for any
Unencumbered Stabilized Asset Property listed on Exhibit A-1 attached hereto;

(c)           if requested in writing by Administrative Agent with respect to
any such Nominated Property that is to qualify as an Unencumbered Stabilized
Asset Property, a current rent roll and leasing status report for such Nominated
Property;

(d)           if requested in writing by Administrative Agent, an operating
statement for such Nominated Property (which shall include a detailed analysis
of the net operating income generated from such property, including gross rental
receipts, detailed operating expenses, capital expenditures and other relevant
information) for the four most recent consecutive calendar quarters for which
Borrower has operating information (or, if operating information for fewer than
four consecutive calendar quarters is available to Borrower, an operating
statement for such Nominated Property for the number of the most recent
consecutive calendar quarters for which Borrower has operating information);

 
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(e)           if such Nominated Property is owned by a Permitted Affiliate, a
Payment Guaranty, executed by such Permitted Affiliate, together with all of the
items described in Sections 5.1.1(b), (c), (d), (e) and (f) with respect to such
Permitted Affiliate;

(f)           if requested in writing by Administrative Agent with respect to
any Nominated Property that is to qualify as an Unencumbered Development
Property, evidence of the cost of such property, an accounting as to all
construction and development costs incurred to date by Borrower or the
applicable Permitted Affiliate with respect to such property, a budget for
expected future construction and development costs to complete construction of
such property, and a construction timetable for such property;

(g)           a certification signed by a Responsible Officer that, to the
actual knowledge of such Responsible Officer, no material structural defects and
no material environmental condition or contamination (including, but not limited
to, with respect to any Hazardous Substances) exist with respect to the
Nominated Property; and

(h)           any other information, documentation or other items relating to
the Nominated Property that Administrative Agent may require in its sole
discretion.

Notwithstanding anything to the contrary contained herein, no property owned by
any subsidiary of Borrower of Guarantor shall be counted as an Unencumbered
Asset Pool Property unless such property is nominated as a Nominated Property
pursuant to Section 4.1 and Section 4.2 and the subsidiary becomes a “Permitted
Affiliate” hereunder by executing the Payment Guaranty and delivering the other
documents described in Section 4.2(e) hereof.

5.
CONDITIONS TO DISBURSEMENTS.

5.1           Conditions to Initial Loans.  The obligation of the Lenders to
make the initial Loan after the Closing Date is subject to the satisfaction of
all of the following conditions precedent:

5.1.1        Deliveries to Administrative Agent.  Administrative Agent shall
have received each of the following items, in form and substance satisfactory to
Administrative Agent and the Lenders:

(a)           Loan Documents.  This Agreement, each Note (including each
Revolving Note and the Swing Line Note), the Guaranty, each Payment Guaranty
issued by each Permitted Affiliate listed on Schedule 1.4, and each other
document the Required Lenders may reasonably require, executed and acknowledged
as appropriate;

(b)           Authorizations.  Evidence that the execution, delivery and
performance by Borrower, Guarantor and each Permitted Affiliate, as the case may
be, of this Agreement and the other Loan Documents have been duly authorized,
executed and delivered by Responsible Officers of Borrower, Guarantor and each
Permitted Affiliate, including, without limitation, authorizing resolutions and
incumbency certificates for such Responsible Officers;

 
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(c)           Governing Documents.  Copies of Borrower’s current partnership
agreement and certificate of limited partnership and any amendments and
modifications thereto, and Guarantor’s articles of incorporation and any
amendments and modifications thereto, and each Permitted Affiliate’s
organizational or formation documents;

(d)           Good Standing.  If required by Administrative Agent, Certificates
of Good Standing for Borrower, Guarantor and each Permitted Affiliate from their
respective states of organization and from any other state in which Borrower,
Guarantor and each Permitted Affiliate is required to qualify to conduct its
business;

(e)           Legal Opinions.  A written opinion of Borrower’s legal counsel and
a written opinion of Guarantor’s and each Permitted Affiliate’s legal counsel,
each covering such matters as the Required Lenders may reasonably require.  The
legal counsel and the terms of the opinion must be reasonably acceptable to
Administrative Agent and the Lenders;

(f)            Insurance.  If required by Administrative Agent, evidence of any
insurance coverage required by Section 6.1.3 of this Agreement;

(g)           Certificate Regarding No Default or Material Adverse Change.  A
certificate of Borrower’s Responsible Officer, dated the Closing Date,
certifying that (i) the representations and warranties contained in Article 7
are true and correct on and as of such date, as though made on and as of such
date; (ii) the calculation of the Availability as of the Closing Date is true
and correct on and as of such date; (iii) no Default or Event of Defaults exists
or would result from the extensions of credit advanced on the Closing Date; and
(iv) no material adverse change in the business, assets, operations, condition
(financial or otherwise) or prospects of Borrower, Guarantor or any of their
subsidiaries or Affiliates has occurred since June 30, 2009, and Guarantor’s
senior unsecured debt rating has not changed since June 30, 2009;

(h)           Property Information.  A copy of each item described in Sections
4.2(b) and (e) and evidence of the insurance required under Section 6.1.3 for
each Unencumbered Stabilized Asset Pool Property listed in Exhibit A-l hereto
and for each Unencumbered Development Property named in Exhibit A-2 hereto.

(i)            Other Items.  Any other items that Administrative Agent
reasonably requires.

Without limiting the generality of the provisions of Section 9.4, for purposes
of determining compliance with the conditions specified in this Section 5.1,
each Lender that has signed this Agreement shall be deemed to have consented to,
approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender unless Administrative Agent shall have received written
notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.

5.1.2        Payment of Fees.  Borrower shall have paid to Administrative Agent,
for its own account or for the account of the Lenders, as applicable, the fees
set forth in the Engagement Letter that are due on or before the Closing Date.

 
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5.1.3        Payment of Expenses.  Payment of the expenses of preparing this
Agreement and the other Loan Documents, including reasonable attorneys’ fees and
costs, the review of any Phase I environmental site assessments, and any and all
other fees due from Borrower to Administrative Agent.

5.2           Conditions of all Borrowings and Letters of Credit.  The
obligation of the Lenders to make any Loan (including the initial Loan) or of
the Swing Line Lender to make any Swing Loan or of the L/C Issuer to issue any
Letter of Credit is subject to the satisfaction of all of the following
conditions precedent on the relevant borrowing date:

(a)           Administrative Agent shall have received a Notice of Borrowing or
Conversion/Continuation requesting an extension of credit;

(b)           The requested extension of credit shall not cause the aggregate
Outstanding Amount of all Loans and Swing Loans and the Outstanding Amount of
all L/C Obligations to exceed the Availability at such time (and if the
requested extension of credit is for a Swing Loan, such requested extension
shall not cause the aggregate principal amount of all then-outstanding Swing
Loans to exceed either of the limitations contained in Sections 2.2.1(b));

(c)           The representations and warranties of Borrower set forth in
Article 7 of this Agreement shall be true and correct in all material respects
on and as of the date of such Borrowing with the same force and effect as if
made on and as of such date;

(d)           No Default or Event of Default shall exist or result from such
Borrowing; and

(e)           If Borrower has requested issuance of a Letter of Credit,
Administrative Agent shall have received a Letter of Credit Application signed
by the account party (and Borrower, if Borrower is not the account party), and
the Fronting Fee for such Letter of Credit described in Section 2.11.2.

6.           COVENANTS OF BORROWER.  Borrower promises to keep each of the
following covenants:

6.1           Specific Affirmative Covenants.

6.1.1        Compliance with Law.  Guarantor shall comply with all existing and
future laws, regulations, orders and requirements of, and all agreements with
and commitments to, all Governmental Authorities having jurisdiction over
Guarantor or Guarantor’s business.  Notwithstanding any contrary provision in
this Section, Guarantor shall have a right to contest all existing and future
Requirements of Law before complying therewith.  Borrower and each Permitted
Affiliate, as applicable, shall comply with all existing and future laws
(including Environmental Laws), regulations, orders, building restrictions and
requirements of, and all agreements with and commitments to, all Governmental
Authorities having jurisdiction over Borrower or Borrower’s business or such
Permitted Affiliate or such Permitted Affiliate’s business, as applicable,
including those pertaining to the construction, sale, leasing or financing of
any Unencumbered Asset Pool Property or the environmental condition of any
Unencumbered Asset Pool Property, and with all recorded covenants and
restrictions affecting any Unencumbered Asset Pool Property (all collectively,
the “Requirements”).  Notwithstanding any contrary provision in this Section,
(i) Borrower and each applicable Permitted Affiliate shall have a right to
contest all existing and future Requirements of Law (other than those relating
to Environmental Laws) before complying therewith, and (ii) Borrower and each
Permitted Affiliate shall have a right to contest all existing and future
Requirements relating to Environmental Laws for one year, before complying
therewith, provide that no Unencumbered Asset Pool Property is in danger of
being lost or forfeited.

 
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6.1.2        Site Visits.  Borrower, each Permitted Affiliate and Guarantor
shall allow Administrative Agent and Lenders access to each Unencumbered Asset
Pool Property at any reasonable time upon reasonable written notice by
Administrative Agent to Borrower (a) for the purpose of inspecting the
Unencumbered Asset Pool Property, and (b) upon reasonable belief by
Administrative Agent or Lenders of the existence of a matter that should be
investigated, for the purpose of taking soil or groundwater samples and
conducting tests, among other things, to investigate for the presence of
Hazardous Substances.  Borrower, each Permitted Affiliate and Guarantor shall
also allow Administrative Agent to examine, copy and audit its and their books
and records.  Neither Administrative Agent nor any Lender is under any duty to
visit or observe any Unencumbered Asset Pool Property, and Administrative Agent
is under no duty to examine any books or records.  Any site visit, observation
or examination by Administrative Agent or any Lender shall be solely for the
purpose of protecting Administrative Agent’s and such Lender’s interests and
preserving Administrative Agent’s rights under the Loan Documents.  Neither
Administrative Agent nor any Lender owes a duty of care to protect Borrower, any
Permitted Affiliate, Guarantor or any other Person against, or to inform
Borrower, Guarantor, any Permitted Affiliate, Guarantor, or any other Person of,
any adverse condition affecting any Unencumbered Asset Pool Property, including
any defects in the design or construction of any improvements located on an
Unencumbered Asset Pool Property or the presence of any Hazardous Substances on
an Unencumbered Asset Pool Property.

6.1.3        Insurance.  Borrower and each Permitted Affiliate, as applicable,
shall maintain the following insurance:

(a)           Special Form property damage insurance in non-reporting form on
each of its Unencumbered Asset Pool Properties, with a policy limit in an amount
not less than the full insurable value of the improvements located on such
property on a replacement cost basis, including tenant improvements, if any,
with a deductible amount, if any, reasonably satisfactory to Administrative
Agent, which insurance shall cover such risks as are ordinarily insured against
by similar businesses.  The policy shall include a business interruption (or
rent loss, if more appropriate) endorsement in the amount of six months’
principal and interest payments, taxes and insurance premiums, and any other
endorsements reasonably required by Administrative Agent.  In addition, with
respect to any Unencumbered Development Property, builder’s risk insurance of a
type and in an amount customarily carried in the case of similar construction in
similar locations.  Notwithstanding the foregoing, earthquake insurance with
respect to any Unencumbered Asset Pool Property shall not be required unless (i)
institutional lenders generally require earthquake insurance for similar types
of multifamily real property in the geographic location where such Unencumbered
Asset Pool Property is located, and (ii) such insurance is generally available
at commercially reasonable rates.

 
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(b)           Comprehensive General Liability coverage with such limits as
Administrative Agent may reasonably require.  This policy shall name
Administrative Agent as an additional insured.  Coverage shall be written on an
occurrence basis, not claims made, and shall cover liability for personal
injury, death, bodily injury and damage to property, products and completed
operations.

(c)           Workers’ compensation insurance for all employees of Borrower and
each subsidiary in such amount as is required by law and including employer’s
liability insurance, if required by Administrative Agent.

All policies of insurance required by Administrative Agent must be issued by
companies reasonably approved by Administrative Agent and otherwise be
reasonably acceptable to Administrative Agent as to amount, forms, risk
coverages and deductibles.  In addition, each policy (except workers’
compensation) must provide Administrative Agent at least 30 days’ prior notice
of cancellation, non-renewal or modification.  If Borrower or a Permitted
Affiliate, as applicable, fails to keep any such coverage in effect while any
Commitment is outstanding, Administrative Agent may procure the coverage at
Borrower’s expense.  Borrower shall reimburse Administrative Agent, on demand,
for all premiums advanced by Administrative Agent or Lenders, which advances
shall be considered to be additional loans to Borrower hereunder at the Default
Rate applicable to Reference Rate Loans.  Neither Administrative Agent nor any
Lender shall, because of accepting, reasonably disapproving, approving or
obtaining insurance, incur any liability for (i) the existence, nonexistence,
form or legal sufficiency thereof, (ii) the solvency of any insurer, or (iii)
the payment of losses.

6.1.4        Preservation of Rights.  Borrower or the applicable Permitted
Affiliate shall obtain and preserve all rights, privileges and franchises
necessary or desirable for the operation of each Unencumbered Asset Pool
Property owned by Borrower or such Permitted Affiliate.  Borrower, Guarantor and
each Permitted Affiliate shall also obtain and preserve all rights, privileges
and franchises necessary or desirable for the conduct of Borrower’s, Guarantor’s
and such Permitted Affiliate’s business.  Either Borrower or the applicable
Permitted Affiliate shall maintain any Unencumbered Asset Pool Property owned by
it in good condition.  Either Borrower or the applicable Permitted Affiliate
shall, at Borrower’s or such Permitted Affiliates sole cost and expense, follow
all recommendations in any asbestos survey conducted by an expert selected by
Borrower or such Permitted Affiliate and approved by Administrative Agent with
respect to any Unencumbered Asset Pool Property owned by Borrower or such
Permitted Affiliate regarding safety conditions for, and maintenance of, any
asbestos containing materials, including any recommendation to institute an O&M
Plan.

6.1.5        Taxes.  Borrower, Guarantor and each Permitted Affiliate shall make
timely payments of all local, state and federal taxes; provided, however, that
none of Borrower, Guarantor or any Permitted Affiliate need pay any such taxes
(a) that it is contesting in good faith and by appropriate proceedings that were
promptly commenced and are being diligently pursued, and (b) for which Borrower
, Guarantor or such Permitted Affiliate, as applicable, has created an
appropriate reserve or other provision as required by GAAP, and no material
property of Borrower, Guarantor or such Permitted Affiliate is in imminent
danger of being lost or forfeited.

 
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6.2           Payment of Expenses

(a)           Borrower shall pay or reimburse Administrative Agent, within
fifteen days after demand, for (i) the costs of electronic distribution services
(such as SyndTrak or IntraLinks) incurred in connection with the closing and
administration of the transactions contemplated by the Loan Documents (which
costs with respect to administration are expected to be approximately $1,500 per
year and which shall in no event exceed $2,500 per year); and (ii) costs,
expenses and other amounts described in Section 10.4(a) hereof.  Such costs and
expenses shall include fees for due diligence and environmental services
(including only those services performed by Administrative Agent or Lender
employees and the cost of those services that Administrative Agent or any Lender
incurs because it believes that such services are required), electronic
distribution service charges, legal fees and expenses of counsel, counsel’s
travel expenses associated with any syndication, lender meetings or other
conferences and any other reasonable fees and costs for services, regardless of
whether such services are furnished by Administrative Agent’s or any Lender’s
employees or by independent contractors.

(b)           Borrower shall pay or reimburse Administrative Agent for the
benefit of each Lender within fifteen days after demand for all costs and
expenses, including all electronic distribution service, legal, audit and review
fees and expenses (including the allocated cost of such services by
Administrative Agent’s employees) incurred by Administrative Agent in connection
with the enforcement or preservation of any rights or remedies under any Loan
Document with respect to a Default or an Event of Default (including any
“workout” or restructuring of the Loans, and any bankruptcy, insolvency or other
similar proceeding, judicial proceeding or arbitration).

Borrower acknowledges that none of the fees described in Section 2.11 include
amounts payable by Borrower under this Section 6.2.  All such sums incurred by
Administrative Agent or any Lender and not immediately reimbursed by Borrower
within fifteen days of written notice by Administrative Agent shall be
considered an additional loan to Borrower hereunder at the Default Rate
applicable to Reference Rate Loans.  The agreements in this Section shall
survive the termination of the Commitments and repayment of all other
Obligations.

6.3           Financial and Other Information; Certification.  Borrower shall
provide to Administrative Agent the following financial information and
statements for Guarantor and its consolidated subsidiaries prepared on a
consolidated basis:

(a)           Within 90 days after each fiscal year end, the annual audited
consolidated financial statements of Guarantor prepared in accordance with GAAP,
and accompanied by the opinion of KPMG LLP or another nationally recognized
Certified Public Accountant stating that such consolidated financial statements
present fairly the financial positions of Guarantor for the periods indicated in
conformity with GAAP applied on a basis consistent with prior years and are not
subject to any “going concern” or like qualification or exception or any
qualification or exception as to the scope of such audit.

(b)           Within 45 days after the end of each of the first three fiscal
quarters, quarterly unaudited financial statements of Guarantor, including cash
flow statements, certified by a Responsible Officer of Guarantor, and (to the
extent appropriate), be prepared on a consolidated basis according to GAAP.

 
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(c)           Within 120 days of Guarantor’s fiscal year end, Guarantor’s annual
report, certified by an appropriate Responsible Officer as being complete and
correct in all material respects.

(d)           If requested by Administrative Agent, copies of Borrower’s and
Guarantor’s federal income tax return (with all schedule K-l’s attached), within
fifteen days of filing, and, if requested by Administrative Agent, copies of any
extensions of the filing date, certified by an appropriate Responsible Officer
as being complete and correct in all material respects.

(e)           Within 45 days after the end of each calendar quarter, in form and
substance reasonably satisfactory to Administrative Agent: (i) an operating
statement and rent roll for each Unencumbered Stabilized Asset Property, and
(ii) if requested by Administrative Agent, a summary of all construction and
development costs incurred in connection with each Unencumbered Development
Property during the last calendar quarter and from the date of the acquisition
of such property, plus a budget for expected future construction and development
costs to complete construction of such property (including a summary of
revisions made since the last budget was delivered for such property), and a
construction timetable for such property (including an explanation of extensions
to such construction timetable made since the last such timetable was delivered
for such property).

(f)            Copies of Guarantor’s Form 10-K Annual Report within 90 days of
its fiscal year end.

(g)           Copies of Guarantor’s Form 10-Q Quarterly Report within 45 days
after the end of each calendar quarter except fiscal year end and copies of all
statements, reports and notices sent or made available generally by Borrower or
Guarantor to their respective security holders at the time they are so sent or
made available, any financial statements contained therein to be certified by
the chief financial officer of Borrower, and (to the extent appropriate) to be
prepared on a consolidated basis according to GAAP and to include Borrower and
Guarantor.

(h)           Within 60 days of the end of each of the first three fiscal
quarters and in addition within 90 days of the end of each fiscal year, a
Compliance Certificate of Borrower signed and certified by an authorized
financial officer of Borrower (i) setting forth the information and computations
(in sufficient detail) to determine the Gross Asset Value, the Total
Liabilities, the Unsecured Debt, the Unencumbered Stabilized Asset Property
Value, the Unencumbered Development Property Value, the Unencumbered Asset Pool
Value, the Debt Service on Unsecured Debt, the EBITDA, the Fixed Charges, the
Secured Recourse Debt and to establish that Borrower is in compliance with all
financial covenants set forth in this Agreement at the end of the period covered
by the financial statements then being furnished, (ii) stating specifically that
the Outstanding Amount of Loans and Swing Loans plus the Outstanding Amount of
L/C Obligations is less than or equal to the Availability, and (iii) setting
forth whether there existed as of the date of the most recent financial
statements of Guarantor and its consolidated subsidiaries and whether there
exists as of the date of the certificate, any Default or Event of Default under
this Agreement and, if any such Default or Event of Default exists, specifying
the nature thereof and the action Borrower is taking and proposes to take with
respect thereto.

 
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(i)            Within 30 days after the end of fiscal year, Borrower’s and
Guarantor’s one-year calendar budget (showing month-by-month projections).

(j)            Within 90 days after the end of each fiscal year, an annual
business plan for Borrower and Guarantor in form and content reasonably
acceptable to Administrative Agent.

(k)           Any other financial or other information concerning Borrower’s,
any Permitted Affiliate’s or Guarantor’s affairs and properties as
Administrative Agent may reasonably request, to be furnished promptly upon such
request.

Documents required to be delivered pursuant to Section 6.3(f) or (g) (to the
extent any such documents are included in materials otherwise filed with the
SEC) may be delivered electronically and if so delivered, shall be deemed to
have been delivered on the date (i) on which Borrower posts such documents, or
provides a link thereto on Borrower’s website on the Internet at its website
address set forth on the signature page hereof (or such other website address as
notified to Administrative Agent and the Lenders); or (ii) on which such
documents are posted on Borrower’s behalf on an Internet or intranet website, if
any, to which each Lender and Administrative Agent have access (whether a
commercial, third-party website or whether sponsored by Administrative Agent);
provided that:  (A) upon request by Administrative Agent, Borrower shall deliver
paper copies of such documents to Administrative Agent until a written request
to cease delivering paper copies is given by Administrative Agent, and (B)
Borrower shall notify (which may be by facsimile or electronic mail)
Administrative Agent of the posting of any such documents and provide to
Administrative Agent by electronic mail electronic versions (i.e., soft copies)
of such documents. Notwithstanding the foregoing in every instance Borrower
shall be required to provide paper copies of the Compliance Certificates,
Administrative Agent shall have no obligation to request the delivery or to
maintain copies of the documents referred to above, and in any event shall have
no responsibility to monitor compliance by Borrower with any such request for
delivery, and each Lender shall be solely responsible for maintaining its copies
of such documents.

Each of Borrower and, by its execution of its consent hereto, Guarantor and each
Permitted Affiliate, hereby acknowledges that (a) Administrative Agent and/or
the Arranger will make available to the Lenders and the L/C Issuer materials
and/or information provided by or on behalf of Borrower, Guarantor or any
Permitted Affiliate hereunder (collectively, “Borrower Materials”) by posting
Borrower Materials on SyndTrak or IntraLinks or another similar electronic
system (the “Platform”), and (b) certain of the Lenders may be “public-side”
Lenders (i.e., Lenders that do not wish to receive material non-public
information with respect to Borrower, Guarantor, the Permitted Affiliates or
their securities) (each, a “Public Lender”).  Each of Borrower and, by its
execution of its consent hereto, Guarantor and each Permitted Affiliate, agrees
that (w) all Borrower Materials that are to be made available to Public Lenders
shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall
mean that the word “PUBLIC” shall appear prominently on the first page thereof;
(x) by marking Borrower Materials “PUBLIC,” Borrower, Guarantor and each
Permitted Affiliate shall be deemed to have authorized Administrative Agent, the
Arranger, the L/C Issuer and the Lenders to treat such Borrower Materials as not
containing any material non-public information with respect to Borrower,
Guarantor, the Permitted Affiliates or their securities for purposes of United
States Federal and state securities laws (provided, however, that to the extent
such Borrower Materials constitute Information, they shall be treated as set
forth in Section 10.6); (y) all Borrower Materials marked “PUBLIC” are permitted
to be made available through a portion of the Platform designated “Public
Investor;” and (z) Administrative Agent and the Arranger shall be entitled to
treat any Borrower Materials that are not marked “PUBLIC” as being suitable only
for posting on a portion of the Platform not designated “Public Investor.”
Notwithstanding the foregoing, neither Borrower nor Guarantor or any Permitted
Affiliate shall be under any obligation to mark any Borrower Materials “PUBLIC.”

 
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6.4           Notices.  Borrower shall promptly notify Administrative Agent in
writing of any knowledge that any officer of Borrower, any Permitted Affiliate
or Guarantor has of:

(a)           any litigation affecting Borrower, any Permitted Affiliate,
Guarantor, any Unencumbered Asset Pool Property, and/or any subsidiary or
affiliate of Borrower or Guarantor that directly owns any Unencumbered Asset
Pool Property or any development property or whose financial results are
consolidated with those of Borrower or Guarantor for reporting purposes, in each
case where the aggregate amount at risk or at issue (including litigation costs
and attorneys’ fees and expenses, but excluding claims which, in Administrative
Agent’s reasonable judgment, are expected to be covered by insurance) exceeds:
(l) in the case of litigation affecting an Unencumbered Asset Pool Property, an
aggregate amount of $10,000,000, or (2) in the case of litigation affecting
Borrower, Guarantor, any Permitted Affiliate or any such subsidiary or affiliate
of Borrower or Guarantor, an aggregate amount of $50,000,000;

(b)           any written notice from any Governmental Authority having
jurisdiction thereover that any property or Borrower’s, any Permitted
Affiliate’s or Guarantor’s business fails in any material respect to comply with
any applicable Law (including any Environmental Law), regulation or court order,
where the failure to comply could have a material adverse effect on Borrower,
such Permitted Affiliate or Guarantor;

(c)           any material adverse change in the physical condition of any
Unencumbered Asset Pool Property or Borrower’s, any Permitted Affiliate’s or
Guarantor’s financial condition or operations, or any other circumstance that
materially adversely affects Borrower’s or a Permitted Affiliate’s intended use
of any Unencumbered Asset Pool Property or Borrower’s ability to repay the Loan;

(d)           any Default or Event of Default, and any failure to comply with
this Agreement or any other Loan Document or any other material agreement to
which Borrower, Guarantor or any Permitted Affiliate is a party, where such
noncompliance has a material adverse effect on the ability of Borrower,
Guarantor or any Permitted Affiliate to perform their respective obligations
under the terms of the Loan Documents;

(e)           any change in Borrower’s or Guarantor’s or any Permitted
Affiliate’s name, legal structure, jurisdiction of formation, place of business
to a state other than the State of California, or chief executive office to a
state other than the State of California if Borrower or Guarantor has more than
one place of business;

 
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(f)            any actual or threatened condemnation of any portion of any
Unencumbered Asset Pool Property given in writing to Borrower or any Permitted
Affiliate, as the case may be, by any Governmental Authority, or any loss of or
substantial damage to any Unencumbered Asset Pool Property;

(g)           any notice of any cancellation, alteration or non-renewal of any
insurance coverage maintained with respect to any Unencumbered Asset Pool
Property; or

(h)           any written notice received by Borrower from any Governmental
Authority that any Unencumbered Asset Pool Property, or any use activity,
operation or maintenance thereof or thereon, is not in compliance with any Law,
including any Environmental Laws, and including notice of (i) any and all
enforcement, cleanup, removal or other governmental or regulatory actions
instituted, completed or threatened against Borrower or any Permitted Affiliate
or any of their respective Unencumbered Asset Pool Properties pursuant to any
applicable Environmental Laws, and (ii) any environmental or similar condition
on any real property adjoining or in the vicinity of any Unencumbered Asset Pool
Property of Borrower or any Permitted Affiliate that could reasonably be
anticipated to cause the applicable Unencumbered Asset Pool Property or any part
thereof to be subject to any restrictions on the ownership, occupancy,
transferability or use of such Unencumbered Asset Pool Property under any
Environmental Laws.

6.5           Negative Covenants.

6.5.1        Limitations on Certain Activities.  Without the prior written
consent of the Required Lenders (or Administrative Agent at the request of the
Required Lenders), which consent shall not be unreasonably withheld or delayed:

(1)           Borrower shall not engage in any business activities that would
result in less than 70% of the Gross Asset Value being derived from multifamily
residential apartments;

(2)           other than in the ordinary course of Borrower’s business, Borrower
shall not lease all or a substantial part of Borrower’s business or Borrower’s
assets;

(3)           neither Borrower nor Guarantor shall enter into or invest in any
consolidation, merger, pool, syndicate or other combination unless Borrower or
Guarantor, as applicable, is the surviving entity and control of Borrower does
not change.

(4)           the legal structure of Borrower shall not change from a limited
partnership that is an operating partnership whose sole general partner is
Guarantor, the legal structure of Guarantor shall not change from a publicly
traded real estate investment trust under the provisions of Internal Revenue
Code Sections 856 and 857, and the legal structure of Borrower and Guarantor
shall not change from a so-called up-REIT;

 
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(5)           Borrower’s, Guarantor’s or any Permitted Affiliate’s jurisdiction
of formation, place of business, or chief executive office (if Borrower,
Guarantor or such Permitted Affiliate has more than one place of business) shall
not change except upon 30 days’ prior written notice to Administrative Agent;

(6)           Borrower’s general partner shall not change from Guarantor; and

(7)           Guarantor shall not suffer a change in its executive management
such that Keith Guericke is no longer chief executive officer and he is not
replaced by Michael J. Schall, George M. Marcus is no longer chairman of the
board of directors or Michael J. Schall is no longer chief operating officer
(unless he has become chief executive officer), unless such executive management
is replaced by parties reasonably acceptable to the Required Lenders within 180
days.

6.5.2           Acquisition Down-REITs.  Borrower and Guarantor shall not in any
case:

(1)           form additional down-REITs for property acquisitions (an
“Acquisition down-REIT”) unless they comply on an on-going basis with each of
the following conditions:

(i)            such Acquisition down-REIT is a limited partnership or limited
liability company, and EMC or any wholly owned subsidiary of Borrower or
Guarantor shall be the sole general partner of any such partnership or the sole
managing member of such limited liability company;

(ii)           Guarantor and/or Borrower and/or EMC shall have effective
management control of each Acquisition down-REIT and each property owned by such
Acquisition down-REIT; and

(iii)          limited partners or members of such Acquisition down-REIT shall
receive only partnership units or membership interests in the Acquisition
down-REIT and/or cash for value contributed.

(2)           liquidate or dissolve Borrower’s or Guarantor’s business;

(3)           liquidate or dissolve the business of any Permitted Affiliate,
unless prior to or contemporaneously with such liquidation or dissolution, (x)
all of the Unencumbered Asset Pool Property owned by such Permitted Affiliate is
removed from the Unencumbered Asset Pool by Borrower pursuant to Section 4.1(b),
(y) such Unencumbered Asset Pool Property is no longer included in the
calculation of Availability hereunder, (z) after the removal of such
Unencumbered Asset Pool Property, the aggregate Outstanding Amount of Loans and
Swing Loans plus the Outstanding Amount of L/C Obligations will be less than or
equal to the Availability and no Event of Default exists); or

(4)           dispose of all or substantially all of Borrower’s or Guarantor’s
business or of Borrower’s or Guarantor’s assets or the business or assets of any
Permitted Affiliate (with the exception of a Permitted Affiliate that owns only
one asset, in which case the business or assets of such Permitted Affiliate may
disposed of as long as, prior to or contemporaneously with such disposition, (x)
all of the Unencumbered Asset Pool Property owned by such Permitted Affiliate is
removed from the Unencumbered Asset Pool by Borrower pursuant to Section 4.1(b),
(y) such Unencumbered Asset Pool Property is no longer included in the
calculation of Availability hereunder, (z) after the removal of such
Unencumbered Asset Pool Property, the aggregate Outstanding Amount of Loans and
Swing Loans plus the Outstanding Amount of L/C Obligations will be less than or
equal to the Availability, the Unencumbered Development Property Value will not
exceed 25% of the Unencumbered Asset Pool Value, and no Event of Default
exists).

 
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6.6           Type of Business; Development Covenants.  Borrower shall own,
manage, finance, lease and/or operate as an owner, developer and/or asset
manager multifamily residential properties, and all of Borrower’s other business
activities and investments shall be incidental thereto, with the exception of
the investments described in clause (e) below.  Guarantor and its consolidated
subsidiaries shall not own at any time, on a consolidated basis:

(a)           entitled and unentitled land,

(b)           development properties,

(c)           Joint Venture Investments,

(d)           Capital Interests in Acquisition down-REITs, and

(e)           real estate assets (other than multifamily residential
properties), or investments in, or loans to, companies that own and/or develop
real estate (other than multifamily residential properties),

the value of which exceeds, in the aggregate for all assets described in clauses
(a)-(e) above, 35% of Gross Asset Value, or in the aggregate for the assets
described in clause (a) above, 10% of Gross Asset Value, or in the aggregate for
the assets described in clause (b) above, 25% of Gross Asset Value.

For the purpose of calculating the value for assets in clauses (a) and (b)
above, projects that have not yet attained a stabilized occupancy (which, for
this purpose only, shall be 90% occupancy) shall be valued at 100% of the
projected total cost of the project (multiplied, if such project is owned by a
Joint Venture, by Borrower’s Capital Interest in such Joint Venture).  Projects
that attain 90% occupancy shall no longer be considered for the purpose of
calculating the development limits contained in this Section 6.6.

6.7           Performance of Acts.  Upon request by Administrative Agent,
Borrower, Guarantor and each Permitted Affiliate shall perform all acts required
of them which may be reasonably necessary or advisable to carry out the intent
of the Loan Documents.

6.8           Keeping Guarantor Informed.  Borrower shall keep Guarantor and
each Permitted Affiliate (and any other Person giving a guaranty to
Administrative Agent and Lenders with regard to the Loans), in its capacity as a
guarantor, informed of Borrower’s financial condition and business operations
and all other circumstances that may affect Borrower’s ability to pay or perform
its obligations under the Loan Documents.  In addition, Borrower shall deliver
to Guarantor, each Permitted Affiliate and any other guarantor all of the
financial information required to be furnished to Administrative Agent
hereunder.

 
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6.9           Maximum Total Liabilities to Gross Asset Value.  Total Liabilities
at the end of each calendar quarter shall not exceed 60% of Gross Asset Value at
such time.

6.10         Debt Ratios.  (a) The amount of Unsecured Debt at the end of each
calendar quarter shall not exceed 60% of the Unencumbered Asset Pool Value at
such time; (b) the Outstanding Amount of all Loans and Swing Loans plus the
Outstanding Amount of all L/C Obligations shall not exceed the Availability at
such time; and (c) the amount of Secured Recourse Debt at the end of each
calendar quarter shall not exceed 10% of the Gross Asset Value at such time.

6.11         Fixed Charge Coverage Ratio.  The ratio determined at the end of
each calendar quarter of (a) EBITDA for the four consecutive calendar quarter
period ending on such determination date divided by (b) the amount of Fixed
Charges for such four calendar quarter period shall not be less than 1.50:1.0.

6.12         Debt Service Coverage Ratio.  The ratio determined at the end of
each calendar quarter of (a) the Net Operating Income for the Unencumbered Asset
Pool for the four consecutive calendar quarter period ending on such date
divided by (b) the amount of Debt Service on Unsecured Debt for such four
calendar quarter period shall not be less than 1.75:1.0.

6.13         Maximum Quarterly Dividends.  Guarantor shall not declare or pay
any distributions or dividends except from cash flow available for distributions
or dividends and earned during the immediately preceding fiscal year, and in any
event not in excess of 95% of Funds From Operations on a rolling four calendar
quarter basis.  The total of common and preferred stock dividends in any
calendar quarter may exceed Funds From Operations for the quarter only to the
extent necessary for Guarantor to retain its status as a real estate investment
trust under the provisions of Internal Revenue Code Sections 856 and
857.  Notwithstanding the foregoing, during the continuance of any Event of
Default, aggregate distributions shall not exceed the minimum amount that
Guarantor must distribute to its shareholders in order to qualify as a real
estate investment trust under the provisions of Internal Revenue Code Sections
856 and 857.

6.14         Negative Pledge; Limitations on Affiliate Indebtedness.

(a)           Neither Borrower nor any Permitted Affiliate shall create, assume,
or allow any Lien (including any judicial lien) on any Unencumbered Asset Pool
Property, and neither Borrower nor Guarantor shall create, assume or allow any
Lien (including any judicial lien) on Borrower’s or Guarantor’s direct or
indirect ownership interests in any Permitted Affiliate, except for Permitted
Liens.

(b)           Neither Borrower nor any Permitted Affiliate shall create, assume
or allow any negative pledge agreement in favor of any other Person affecting or
relating to any Unencumbered Asset Pool Property.  In addition, neither
Borrower, Guarantor nor any Permitted Affiliate (in this context, an “Obligor”)
shall incur any Indebtedness owing to Borrower, Guarantor, any Permitted
Affiliate or any other Affiliate (in this context, a “Creditor”) that is in
excess of $3,000,000 owing by an Obligor to any Creditor or in excess of
$10,000,000, in the aggregate, owing by the Obligors to any one or more
Creditors, unless such Indebtedness has been subordinated in right of payment to
the full and prior repayment to Administrative Agent and Lenders of the
Obligations pursuant to a subordination agreement in form and substance
acceptable to Administrative Agent in its reasonable discretion (an “Approved
Subordination Agreement”).

 
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(c)           Borrower and each Permitted Affiliate shall have the right to
contest in good faith by appropriate legal or administrative proceeding the
validity of any prohibited Lien affecting its properties so long as (i) no Event
of Default exists and is continuing, (ii) Borrower or such Permitted Affiliate,
as applicable, first deposits with Administrative Agent a bond or other security
satisfactory to Administrative Agent in the amount reasonably required by
Administrative Agent; (iii) Borrower or such Permitted Affiliate, as applicable,
immediately commences its contest of such Lien and continuously pursues the
contest in good faith and with due diligence; (iv) foreclosure of the Lien is
stayed; and (v) Borrower or such Permitted Affiliate, as applicable, pays any
judgment rendered for the Lien claimant or other third party, unless such
judgment has been stayed as the result of an appeal, within 30 days after the
entry of the judgment.  Borrower or such Permitted Affiliate, as applicable,
will discharge or elect to contest and post an appropriate bond or other
security within 30 days of written demand by Administrative Agent.

6.15         Change in Ownership of Borrower or Management of the Unencumbered
Asset Pool Property.  Borrower shall not cause, permit or suffer (a) any change
of the general partner of Borrower, (b) any change in the control of Guarantor
(whether by tender offer for a majority of the outstanding shares of Guarantor,
a merger in which Guarantor is not the surviving entity, or otherwise), (c) any
Permitted Affiliate to be less than wholly-owned (directly or indirectly) by
Borrower or Guarantor, as long as any Unencumbered Asset Pool Property owned by
such Permitted Affiliate is included in the Unencumbered Asset Pool and the
calculation of Availability; or (d) any Person other than Guarantor or an
Affiliate of Guarantor to manage an Unencumbered Asset Pool
Property.  Notwithstanding the foregoing, a Permitted Affiliate or, subject to
the prior written consent of the Required Lenders [(except in the case of R.A.
Snyder Properties, Inc., and Con Am Management Corporation, for which no prior
written consent shall be required)], which consent shall not be unreasonably
withheld or delayed, an independent third-party, may manage an Unencumbered
Asset Pool Property following the addition of such property into the
Unencumbered Asset Pool pursuant to Section 4.

6.16         Books and Records.  Each of Guarantor, Borrower and each Permitted
Affiliate and each of their respective subsidiaries shall maintain adequate
books and records (provided that, with respect to the Permitted Affiliates and
subsidiaries, such books and records shall mean its income and expense
statements).

6.17         Audits.  Borrower, Guarantor and each Permitted Affiliate shall
allow Administrative Agent and its agents to inspect its properties and examine,
audit and make copies of its books and records at any reasonable time upon
reasonable notice to Borrower.  If any of the properties, books or records of
Borrower, Guarantor or any Permitted Affiliate are in the possession of a third
party, Borrower, Guarantor or such Permitted Affiliate, as applicable, shall
authorize that third party to permit Administrative Agent or its agents to have
access to perform inspections or audits and to respond to Administrative Agent’s
requests for information concerning such properties, books and records.

 
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6.18         Cooperation.  Borrower, Guarantor and each Permitted Affiliate
shall take any action reasonably requested by Administrative Agent to carry out
the intent of this Agreement.

6.19         ERISA Plans.  Borrower shall give prompt written notice to
Administrative Agent of the occurrence of any ERISA Event.

6.20         Use of Proceeds.  Borrower shall use the proceeds of the Loan only
for (a) financing for acquisition, development and/or redevelopment of real and
personal property, (b) letters of credit, (c) working capital in Borrower’s
business, and (d) other purposes permitted by Borrower’s organizational
documents as they appear as of the Closing Date.

6.21         Use of Proceeds – Ineligible Securities.  Borrower shall not use
any proceeds of the Loans, directly or indirectly, to purchase or carry, or
reduce or retire any loan incurred to purchase or carry, any “Margin Stock”
(within the meaning of Regulation U of the Board of Governors of the Federal
Reserve System) or to extend credit to others for the purpose of purchasing or
carrying any Margin Stock.

7.             Representations and Warranties.  When Borrower and Guarantor sign
this Agreement, and until Administrative Agent and Lenders are repaid in
full.  Borrower and Guarantor make the following representations and
warranties.  Each request for an extension of credit constitutes a renewed
representation and warranty.

7.1           Organization of Borrower, Guarantor and each Permitted
Affiliate.  Borrower is a limited partnership duly formed, validly existing and
in good standing under the laws of California.  Guarantor and each Permitted
Affiliate is an entity duly organized, validly existing and in good standing
under the laws of its state of formation or organization.

7.2           Authorization.  The execution and compliance with this Agreement
and each Loan Document to which Borrower, Guarantor and each Permitted Affiliate
is a party are within such Person’s powers, have been duly authorized, and do
not conflict with any of such Person’s organizational or formation papers.

7.3           Enforceable Agreement.  This Agreement is a legal, valid and
binding agreement of Borrower, enforceable against Borrower in accordance with
its terms, and it and any Loan Document to which it, Guarantor or any Permitted
Affiliate is a party, when executed and delivered, will be similarly legal,
valid, binding and enforceable, except as the same may be limited by insolvency,
bankruptcy, reorganization, or other laws relating to or affecting the
enforcement of creditors’ rights or by general equitable principles.

7.4           Good Standing.  In each state in which Borrower, Guarantor and
each Permitted Affiliate does business, it is properly licensed, in good
standing, and, where required, in compliance with fictitious name statutes.

7.5           No Conflicts.  Neither Borrower, Guarantor, any Permitted
Affiliate, nor the Unencumbered Asset Pool Property, are in violation of, nor do
the terms of this Agreement or any other Loan Document conflict with, any law
(including any Environmental Laws), regulation or ordinance, any order of any
court or governmental entity, any organizational documents of Borrower or
Guarantor, or any covenant or agreement affecting Borrower, Guarantor or any
Permitted Affiliate or the Unencumbered Asset Pool Property, which has a
material adverse effect on Borrower, Guarantor or any Permitted Affiliate or the
Unencumbered Asset Pool Property.

 
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7.6           Financial Information.  All financial information which has been
and will be delivered to Administrative Agent, including all information
relating to the financial condition of Borrower, Guarantor, any Permitted
Affiliate and the Unencumbered Asset Pool Property, did as of its date fairly
and accurately represent the financial condition being reported on.  All such
information was and will be prepared in accordance with GAAP, unless otherwise
noted.  Since June 30, 2009, there has been no material adverse change in the
financial condition of Borrower, Guarantor, any Permitted Affiliate or the
Unencumbered Asset Pool Property.

7.7           Borrower Not a “Foreign Person”.  Borrower is not a “foreign
person” within the meaning of Section 1445(f)(3) of the Internal Revenue Code of
1986, as amended from time to time.

7.8           Lawsuits.  There are no lawsuits, actions, tax claims,
investigations, proceedings, or other disputes, pending or threatened, in any
court or before any arbitrator or Governmental Authority that purport to affect
Borrower, Guarantor, any subsidiaries or affiliates of Borrower or Guarantor,
any Unencumbered Asset Pool Property, or any transaction contemplated by this
Agreement or any other Loan Document that will have a material adverse effect on
Borrower, Guarantor, any Unencumbered Asset Pool Property, or any subsidiaries
or affiliates of Borrower or Guarantor, or any transaction contemplated by this
Agreement or any other Loan Document, or on the ability of Borrower, Guarantor
or any of their subsidiaries or affiliates, to perform their respective
obligations under the Loan Documents,

7.9           Permits, Franchises.  Borrower, Guarantor and each Permitted
Affiliate possesses all permits, memberships, franchises, contracts and licenses
required and all trademark rights, trade name rights, patent rights and
fictitious name rights necessary to enable it to conduct the business in which
it is now engaged.

7.10         Other Obligations.  None of Borrower, Guarantor or any Permitted
Affiliate is in material default (taking into account all applicable cure
periods, if any) on any material obligation for borrowed money, any purchase
money obligation or any other material lease, commitment, contract, instrument
or obligation.

7.11         Income Tax Returns.  Except as otherwise disclosed to
Administrative Agent in a writing referring to this Section 7.11, Borrower has
no knowledge of any pending assessments or adjustments of the income tax of
Borrower, Guarantor or any Permitted Affiliate in an amount in excess $500,000
for any year, individually or in the aggregate.

7.12         No Event of Default.  There is no event which is, or with notice or
lapse of time or both would be, an Event of Default under this Agreement.

 
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7.13         ERISA Plans.

(a)           Borrower has fulfilled its obligations, if any, under the minimum
funding standards of ERISA and the Code with respect to each Plan and is in
compliance in all material respects with the presently applicable provisions of
ERISA and the Code, and has not incurred any liability with respect to any Plan
under Title IV of ERISA.

(b)           No Reportable Event has occurred.

(c)           No action by Borrower to terminate or withdraw from any Plan has
been taken and no notice of intent to terminate a Plan has been filed under
Section 4041 of ERISA.

(d)           No proceeding has been commenced with respect to a Plan under
Section 4042 of ERISA, and no event has occurred or condition exists which might
constitute grounds for the commencement of such a proceeding.

7.14         Location of Borrower.  Borrower’s place of business (or, if
Borrower has more than one place of business, its chief executive office) is
located at the address listed under Borrower’s signature on this Agreement or at
such other place as to which Borrower has notified Administrative Agent in
writing.

7.15         No Required Third Party/Governmental Approvals.  No approval,
consent, exemption, authorization, or other action by, or notice to, or filing
with any third party or any Governmental Authority, is necessary or required in
connection with the execution, delivery or performance of this Agreement or any
other Loan Document to which Borrower, Guarantor or any Permitted Affiliate is a
party, or the enforcement of any such agreements against Borrower, Guarantor or
any Permitted Affiliate.

7.16         Regulated Entities.  Neither Borrower nor any Person controlling
Borrower is an “Investment Company” within the meaning of the Investment Company
Act of 1940; or subject to regulation under the Public Utility Holding Company
Act of 1935, the Federal Power Act, the Interstate Commerce Act, any state
public utilities code, or any other federal or state statute or regulation
limiting its ability to incur Indebtedness.

8.
DEFAULT AND REMEDIES.

8.1           Events of Default.  Borrower will be in default under this
Agreement upon the occurrence of any one or more of the following events (“Event
of Default”):

(a)           Borrower fails to make any payment due hereunder, or fails to make
any payment demanded by Administrative Agent under any Loan Document, on the
earlier of (i) the Maturity Date or (ii) within fifteen days after (x) the date
when due or (y) if the payment is unscheduled, the date when payment is demanded
by Administrative Agent; or

(b)           Borrower fails to perform or observe any term, covenant or
agreement contained in (i) any of Sections 6.13 or 6.21; or (ii) any of Sections
6.1.3, 6.3, 6.5, 6.14 or 6.17 and does not cure that failure within fifteen days
after written notice from Administrative Agent; or (iii) Section 6.4 and does
not cure that failure within fifteen days after Borrower’s Knowledge of such
failure; or (iv) Section 6.15 and does not cure such failure within fifteen days
after the occurrence of such failure; or (v) any of Sections 6.9, 6.10, 6.11 or
6.12 and does not cure that failure within 45 days after the end of the fiscal
quarter in which such Default arose; or

 
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(c)           Borrower fails to comply with any covenant contained in this
Agreement other than those referred to in clauses (a) and (b), and does not
either cure that failure within 30 days after written notice from Administrative
Agent, or, if the default cannot be cured in 30 days, Borrower fails to promptly
commence cure (in any event, within ten days after receipt of such notice), and
thereafter diligently prosecute such cure to completion, and complete such cure
within 90 days after receipt of such notice; or

(d)           (i) Borrower, any Permitted Affiliate or Guarantor institutes or
consents to the institution of any Insolvency Proceeding, makes an assignment
for the benefit of creditors or applies for or consents to the appointment of
any receiver, trustee, custodian, conservator, liquidator, rehabilitator or
similar officer for it or for all or any material part of its property; (ii) any
receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar
officer is appointed without the application or consent of Borrower, any
Permitted Affiliate or Guarantor and the appointment continues undischarged or
unstayed for 60 calendar days; (iii) any Insolvency Proceeding relating to
Borrower, any Permitted Affiliate or Guarantor or to all or any material part of
its property is instituted without the consent of such Person and continues
undismissed or unstayed for 60 calendar days, or an order for relief is entered
in any such proceeding; (iv) Borrower, any Permitted Affiliate or Guarantor
becomes unable or admits in writing its inability or fails generally to pay its
debts as they become due, or (b) any writ or warrant of attachment or execution
or similar process is issued or levied against all or any material part of the
property of Borrower, any Permitted Affiliate or Guarantor and is not released,
vacated or fully bonded within 30 days after its issue or levy; or

(e)           Borrower, any Permitted Affiliate or Guarantor dissolves or
liquidates; or

(f)            Any representation or warranty made or given in any of the Loan
Documents proves to be false or misleading in any material respect; or

(g)           Guarantor or any Permitted Affiliate breaches or fails to comply
with any covenant contained in this Agreement or any other Loan Document
applicable to it, other than those defaults included within clause (b) above,
and does not cure that failure within 30 days after written notice from
Administrative Agent, or, if the default cannot be cured in 30 days, Guarantor
or such Permitted Affiliate fails to promptly commence cure (in any event,
within ten days after receipt of such notice), and thereafter diligently
prosecute such cure to completion, and complete such cure within 90 days after
receipt of such notice; or

(h)           A defined event of default occurs under any of the Loan Documents;
or

(i)            A final non-appealable judgment or order is entered against
Borrower, any Permitted Affiliate or Guarantor that materially adversely affects
(i) Borrower’s or such Permitted Affiliate’s intended use of one or more of the
Unencumbered Asset Pool Properties (subject to Borrower’s right to remove any
Unencumbered Asset Pool Property from the Unencumbered Asset Pool pursuant to
Section 4.1 (b)) or (ii) Borrower’s, any Permitted Affiliate’s or Guarantor’s
ability to repay the Loans; or

 
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(j)            Borrower, Guarantor or any Permitted Affiliate fails, after the
expiration of applicable cure periods, if any, to perform any obligation under
any other agreement Borrower has with Administrative Agent or any Lender or any
Affiliate of Administrative Agent or any Lender; or

(k)           Borrower, Guarantor or a Permitted Affiliate defaults (taking into
account applicable cure periods, if any) in connection with any credit such
Person has with any holder of Indebtedness of such Person, if (1) the default
consists of the failure to make a payment in excess of $5,000,000 when due, or
(2) one or more obligations that are recourse to Borrower, Guarantor or a
Permitted Affiliate whose outstanding principal amount exceeds $20,000,000 in
the aggregate have been accelerated; or

(l)            There is a material adverse change in Borrower’s or Guarantor’s
financial condition, or an event or condition that materially impairs Borrower’s
or a Permitted Affiliate’s intended use of one or more of the Unencumbered Asset
Pool Properties (subject to Borrower’s right to remove any Unencumbered Asset
Pool Property from the Unencumbered Asset Pool pursuant to Section 4.1 (b))
which materially impairs Borrower’s or Guarantor’s ability to repay the Loan; or

(m)          Guarantor shall no longer qualify as a real estate investment trust
under the provisions of Code Sections 856 and 857; or

(n)           (i) An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in liability of Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $15,000,000,
or (ii) Borrower or any ERISA Affiliate fails to pay when due, after the
expiration of any applicable grace period, any installment payment with respect
to its withdrawal liability under Section 4201 of ERISA under a Multiemployer
Plan in an aggregate amount in excess of $15,000,000; or

(o)           Any Loan Document, at any time after its execution and delivery
and for any reason other than as expressly permitted hereunder or satisfaction
in full of all the Obligations, ceases to be in full force and effect (unless
such Loan Document is replaced in a manner reasonably satisfactory to
Administrative Agent); or any of Borrower, Guarantor or a Permitted Affiliate or
a subsidiary of any of them contests in any manner the validity or
enforceability of the remedies of Administrative Agent, the L/C Issuer or any
Lender under any Loan Document; or a party to a Loan Document (other than any
Lender or Administrative Agent) denies that it has any further liability or
obligation under any Loan Document, or purports to revoke, terminate or rescind
any Loan Document.

Notwithstanding the foregoing, any event or circumstance described in the
foregoing clauses (a)-(o) with respect to any Permitted Affiliate shall not
constitute an Event of Default hereunder as long as, no later than 30 days after
Borrower’s Knowledge of such event or circumstance, (i) all of the Unencumbered
Asset Pool Property owned by such Permitted Affiliate is removed from the
Unencumbered Asset Pool by Borrower pursuant to Section 4.1(b), (ii) such
Unencumbered Asset Pool Property is no longer included in the calculation of
Availability hereunder, (iii) after the removal of such Unencumbered Asset Pool
Property, the aggregate Outstanding Amount of Loans and Swing Loans plus the
Outstanding Amount of L/C Obligations will be less than or equal to the
Availability, the Unencumbered Development Property Value does not exceed 20% of
the Unencumbered Asset Pool Value, and no Event of Default exists.

 
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8.2           Remedies.  If any Event of Default occurs, Administrative Agent
shall, at the request of, or may, with the consent of, the Required Lenders:

8.2.1        Termination of Commitment to Lend.  Declare the Commitment of each
Lender and the commitment of the Swing Line Lender to make Loans or Swing Loans,
as the case may be, and the commitment of the L/C Issuer to issue Letters of
Credit to be terminated, whereupon such commitments shall forthwith be
terminated; provided, however, that Administrative Agent and the Lenders shall
continue to honor any outstanding Letter of Credit; and

8.2.2        Acceleration of Loans.  Declare the unpaid principal amount of all
outstanding Loans and Swing Loans, all interest accrued and unpaid thereon, and
all other amounts owing or payable hereunder or under any other Loan Document to
be immediately due and payable, without presentment, demand, protest or other
notice of any kind, all of which are hereby expressly waived by Borrower; and

8.2.3        Security for Letters of Credit.  Require that Borrower deposit with
Administrative Agent, for the benefit of the Lenders, on demand and as cash
security for Borrower’s obligations under the Loan Documents, Cash Collateral in
an amount equal to the aggregate undrawn amount of all then outstanding Letters
of Credit (and Borrower hereby grants to Administrative Agent, as administrative
agent for the Lenders, a security interest in any such amount deposited with
Administrative Agent (and any amount deposited with Administrative Agent
pursuant to Section 2.8.2(a)), all earnings thereon and all proceeds thereof,
and as to such amounts Administrative Agent shall have the rights and remedies
of a secured party under the California Uniform Commercial Code); provided that
upon the occurrence of any event specified in Section 8.1(d) above with respect
to Borrower or Guarantor, such amounts shall automatically become due and
payable without further act of Administrative Agent or the Lenders; and

8.2.4        Exercise of Rights and Remedies.  Exercise all rights and remedies
available to it under the Loan Documents or applicable Law; provided, however,
that upon the occurrence of any event specified in Section 8.1(d) above, the
obligation of each Lender and the Swing Line Lender to make Loans or Swing
Loans, as the case may be, and the obligation of the L/C Issuer to issue Letters
of Credit shall automatically terminate, and the unpaid principal amount of all
outstanding Loans and Swing Loans and all interest and other amounts as
aforesaid shall automatically become due and payable without further act of
Administrative Agent or any Lender.

8.3           Application of Funds.  After the exercise of remedies provided for
in Section 8.2 (or after the Loans and Swing Loans have automatically become
immediately due and payable and the undrawn amount of outstanding Letters of
Credit have automatically been required to be Cash Collateralized as set forth
in the proviso to Section 8.2.3), any amounts received on account of the
Obligations shall be applied by Administrative Agent in the following order:

 
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First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including legal fees and expenses and
amounts payable under Sections 2.11, 6.2, and 10.4) payable to Administrative
Agent in its capacity as such;

Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal and interest) payable to the
Lenders (including amounts payable under Sections 2.11, 3.1, 3.3, 3.4, 6.2, and
10.4), ratably among them in proportion to the amounts described in this clause
Second are payable to them;

Third, to payment of that portion of the Obligations constituting accrued and
unpaid interest on the Loans, Swing Loans, L/C Borrowings and other Obligations,
ratably among the Lenders in proportion to the respective amounts described in
this clause Third payable to them;

Fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans, Swing Loans and L/C Borrowings, ratably among the
Lenders in proportion to the respective amounts described in this clause Fourth
held by them;

Fifth, to Administrative Agent for the account of the L/C Issuer to Cash
Collateralize the aggregate undrawn amount of Letters of Credit; and

Last, the balance, if any, after all of the Obligations have been indefeasibly
paid in full, to Borrower or as otherwise required by law.

Subject to Section 2.5.5, amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause Fifth above shall be
applied to satisfy drawings under such Letters of Credit as they occur.  If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.

9.
ADMINISTRATIVE AGENT.

9.1           Appointment and Authority.  Each of the Lenders and the L/C Issuer
hereby irrevocably appoints PNC Bank to act on its behalf as Administrative
Agent hereunder and under the other Loan Documents and authorizes Administrative
Agent to take such actions on its behalf and to exercise such powers as are
delegated to Administrative Agent by the terms hereof or thereof, together with
such actions and powers as are reasonably incidental thereto.  The provisions of
this Article 9 are solely for the benefit of Administrative Agent, the Lenders
and the L/C Issuer, and Borrower shall not have rights as a third party
beneficiary of any of such provisions.

9.2           Rights as a Lender.  The Person serving as Administrative Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not Administrative
Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly
indicated or unless the context otherwise requires, include the Person serving
as Administrative Agent hereunder in its individual capacity.  Such Person and
its Affiliates may accept deposits from, lend money to, act as the financial
advisor or in any other advisory capacity for and generally engage in any kind
of business with Borrower or any subsidiary or other Affiliate thereof as if
such Person were not Administrative Agent hereunder and without any duty to
account therefor to the Lenders.

 
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9.3           Exculpatory Provisions.

9.3.1        Limitation of Administrative Agent’s Duties.  Administrative Agent
shall not have any duties or obligations except those expressly set forth herein
and in the other Loan Documents.  Without limiting the generality of the
foregoing, Administrative Agent: (a) shall not be subject to any fiduciary or
other implied duties, regardless of whether a Default or Event of Default has
occurred and is continuing; (b) shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby or by the other Loan Documents
that Administrative Agent is required to exercise as directed in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be
expressly provided for herein or in the other Loan Documents), provided that
Administrative Agent shall not be required to take any action that, in its
opinion or the opinion of its counsel, may expose Administrative Agent to
liability or that is contrary to any Loan Document or applicable law; and (c)
shall not, except as expressly set forth herein and in the other Loan Documents,
have any duty to disclose, and shall not be liable for the failure to disclose,
any information relating to Borrower or any of its Affiliates that is
communicated to or obtained by the Person serving as Administrative Agent or any
of its Affiliates in any capacity.

9.3.2        Limitation of Administrative Agent’s Liability.  Administrative
Agent shall not be liable to any Lender for any action taken or not taken by it
(i) with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary, or as Administrative
Agent shall believe in good faith shall be necessary, under the circumstances as
provided in Sections 8.2 and 9.1), or (ii) in the absence of its own gross
negligence or willful misconduct.  Administrative Agent shall be deemed not to
have knowledge of any Default or Event of Default unless and until notice
describing such Default or Event of Default is given to Administrative Agent by
Borrower, a Lender or the L/C Issuer.

9.3.3        Limitation of Administrative Agent’s
Responsibilities.  Administrative Agent shall not be responsible to any Lender
or L/C Issuer for, or have any duty to ascertain or inquire for the benefit of
any Lender or L/C Issuer into, (i) any statement, warranty or representation
made in or in connection with this Agreement or any other Loan Document, (ii)
the contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein or therein or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other Loan
Document or any other agreement, instrument or document, or (v) the satisfaction
of any condition set forth in Article 5 or elsewhere herein, other than to
confirm receipt of items expressly required to be delivered to Administrative
Agent.

 
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9.4           Reliance by Administrative Agent.  Administrative Agent shall be
entitled to rely upon, and shall not incur any liability to any Lender or L/C
Issuer for relying upon, any notice, request, certificate, consent, statement,
instrument, document or other writing (including any electronic message,
Internet or intranet website posting or other distribution) believed by it to be
genuine and to have been signed, sent or otherwise authenticated by the proper
Person; provided, however, that notwithstanding any such notice, request or
other direction to the contrary, in all events Administrative Agent shall direct
that the proceeds of a Borrowing be deposited in the account of the Borrower
designated to Administrative Agent on the Closing Date (the “Designated
Borrower’s Account”).  Subject to the foregoing sentence, Administrative Agent
also may rely upon any statement made to it orally or by telephone and believed
by it to have been made by the proper Person, and shall not incur any liability
for relying thereon.  In determining compliance with any condition hereunder to
the making of a Loan, or the issuance of a Letter of Credit, that by its terms
must be fulfilled to the satisfaction of a Lender or the L/C Issuer,
Administrative Agent may presume that such condition is satisfactory to such
Lender or the L/C Issuer unless Administrative Agent shall have received notice
to the contrary from such Lender or the L/C Issuer prior to the making of such
Loan or the issuance of such Letter of Credit.  Administrative Agent may consult
with legal counsel (who may be counsel for Borrower), independent accountants
and other experts selected by it, and shall not be liable for any action taken
or not taken by it in accordance with the advice of any such counsel,
accountants or experts.

9.5           Delegation of Duties.  Administrative Agent may perform any and
all of its duties and exercise its rights and powers hereunder or under any
other Loan Document by or through any one or more sub-agents appointed by
Administrative Agent.  Administrative Agent and any such sub-agent may perform
any and all of its duties and exercise its rights and powers by or through their
respective Related Parties.  The exculpatory provisions of this Article shall
apply to any such sub-agent and to the Related Parties of Administrative Agent
and any such sub-agent, and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities as Administrative Agent.

9.6           Resignation of Administrative Agent.

9.6.1        Notice of Resignation.  Administrative Agent may at any time give
notice of its resignation to the Lenders, the L/C Issuer and Borrower.  Upon
receipt of any such notice of resignation, the Required Lenders shall have the
right, in consultation with Borrower, to appoint a successor, which shall be a
bank with an office in the United States, or an Affiliate of any such bank with
an office in the United States; provided that as long as no Event of Default
hereunder has occurred and is continuing, Borrower shall have the right to
consent to such successor, such consent to not be unreasonably withheld.  If no
such successor shall have been so appointed by the Required Lenders and shall
have accepted such appointment within 30 days after the retiring Administrative
Agent gives notice of its resignation, then the retiring Administrative Agent
may on behalf of the Lenders and the L/C Issuer, appoint a successor
Administrative Agent meeting the qualifications set forth above, provided that
as long as no Event of Default hereunder has occurred and is continuing,
Borrower shall have the right to consent to such successor, such consent to not
be unreasonably withheld; provided further that if Administrative Agent shall
notify Borrower and the Lenders that no qualifying Person has accepted such
appointment, then such resignation shall nonetheless become effective in
accordance with such notice and (1) the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder and under the other Loan
Documents and (2) all payments, communications and determinations provided to be
made by, to or through Administrative Agent shall instead be made by or to each
Lender and the L/C Issuer directly, until such time as the Required Lenders
appoint a successor Administrative Agent as provided for above in this
Section.  Upon the acceptance of a successor’s appointment as Administrative
Agent hereunder, such successor shall succeed to and become vested with all of
the rights, powers, privileges and duties of the retiring (or retired)
Administrative Agent, and the retiring Administrative Agent shall be discharged
from all of its duties and obligations hereunder or under the other Loan
Documents (if not already discharged therefrom as provided above in this
Section).  The fees payable by Borrower to a successor Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed in
writing between Borrower and such successor.  After the retiring Administrative
Agent’s resignation hereunder and under the other Loan Documents, the provisions
of this Article and Section 10.4 shall continue in effect for the benefit of
such retiring Administrative Agent, its sub-agents and their respective Related
Parties in respect of any actions taken or omitted to be taken by any of them
while the retiring Administrative Agent was acting as Administrative Agent.

 
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9.6.2        Resignation by PNC Bank.  Any resignation by PNC Bank as
Administrative Agent pursuant to this Section shall also constitute its
resignation as L/C Issuer and Swing Line Lender.  Upon the acceptance of a
successor’s appointment as Administrative Agent hereunder, (a) such successor
shall succeed to and become vested with all of the rights, powers, privileges
and duties of the retiring L/C Issuer and Swing Line Lender, (b) the retiring
L/C Issuer and Swing Line Lender shall be discharged from all of their
respective duties and obligations hereunder or under the other Loan Documents,
and (c) the successor L/C Issuer shall issue letters of credit in substitution
for the Letters of Credit, if any, outstanding at the time of such succession or
make other arrangements satisfactory to the retiring L/C Issuer to effectively
assume the obligations of the retiring L/C Issuer with respect to such Letters
of Credit.

9.7           Non-Reliance on Administrative Agent and Other Lenders.  Each
Lender and the L/C Issuer acknowledges that it has, independently and without
reliance upon Administrative Agent or any other Lender or any of their Related
Parties and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement.  Each Lender and the L/C Issuer also acknowledges that it will,
independently and without reliance upon Administrative Agent or any other Lender
or any of their Related Parties and based on such documents and information as
it shall from time to time deem appropriate, continue to make its own decisions
in taking or not taking action under or based upon this Agreement, any other
Loan Document or any related agreement or any document furnished hereunder or
thereunder.

9.8           No Other Duties, Etc.  Anything herein to the contrary
notwithstanding, none of the Sole Lead Arranger or the Sole Book Manager listed
on the cover page hereof shall have any powers, duties or responsibilities under
this Agreement or any of the other Loan Documents, except in its capacity, as
applicable, as Administrative Agent, a Lender or the L/C Issuer hereunder.

 
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9.9           Administrative Agent May File Proofs of Claim.  In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to Borrower, Guarantor or any Permitted Affiliate,
Administrative Agent (irrespective of whether the principal of any Loan or L/C
Obligation shall then be due and payable as herein expressed or by declaration
or otherwise and irrespective of whether Administrative Agent shall have made
any demand on Borrower) shall be entitled and empowered, by intervention in such
proceeding or otherwise (a) to file and prove a claim for the whole amount of
the principal and interest owing and unpaid in respect of the Loans, Swing
Loans, L/C Obligations and all other Obligations that are owing and unpaid and
to file such other documents as may be necessary or advisable in order to have
the claims of the Lenders, the L/C Issuer and Administrative Agent (including
any claim for the reasonable compensation, expenses, disbursements and advances
of the Lenders, the L/C Issuer and Administrative Agent and their respective
agents and counsel and all other amounts due the Lenders, the L/C Issuer and
Administrative Agent under Sections 2.11, 6.2 and 10.4) allowed in such judicial
proceeding; and (b) to collect and receive any monies or other property payable
or deliverable on any such claims and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender and the L/C
Issuer to make such payments to Administrative Agent and, in the event that
Administrative Agent shall consent to the making of such payments directly to
the Lenders and the L/C Issuer, to pay to Administrative Agent any amount due
for the reasonable compensation, expenses, disbursements and advances of
Administrative Agent and its agents and counsel, and any other amounts due
Administrative Agent under Sections 2.11, 6.2 and 10.4.  Nothing contained
herein shall be deemed to authorize Administrative Agent to authorize or consent
to or accept or adopt on behalf of any Lender or the L/C Issuer any plan of
reorganization, arrangement, adjustment or composition affecting the Obligations
or the rights of any Lender or to authorize Administrative Agent to vote in
respect of the claim of any Lender in any such proceeding.

9.10         Release of Permitted Affiliate from Payment Guaranty.  The Lenders
irrevocably authorize Administrative Agent, at its option and in its discretion
and without the consent of any Lender, to release any Permitted Affiliate from
its obligations under its Payment Guaranty if such Person ceases to be an owner
of an Unencumbered Asset Pool Property as a result of a transaction permitted
hereunder.  Upon request by Administrative Agent at any time, the Required
Lenders will confirm in writing Administrative Agent’s authority to release any
Permitted Affiliate from its obligations under its Payment Guaranty pursuant to
this Section 9.10.

10.
MISCELLANEOUS PROVISIONS.

10.1         Amendments and Waivers.  No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent with respect to any
departure by Borrower, Guarantor or any Permitted Affiliate therefrom, shall be
effective unless the same shall be in writing and signed by the Required Lenders
(or by Administrative Agent at the written request of the Required Lenders) and,
in the case of an amendment, by Borrower or Guarantor or, if required, a
Permitted Affiliate, and acknowledged by Administrative Agent, and then any such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no such waiver,
amendment or consent shall:

 
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(a)           waive any condition set forth in Section 5.1 without the written
consent of each Lender;

(b)           increase the aggregate Commitment or increase the Commitment of
any Lender without the written consent of such Lender;

(c)           postpone or delay any date fixed by this Agreement or any other
Loan Document for any payment of principal, interest, fees or other amounts due
to the Lenders, or any of them, hereunder or under any other Loan Document
without the written consent of each Lender directly affected thereby;

(d)           reduce the rate of interest or any fees or other amounts payable
in connection with the Loans, Swing Loans or L/C Borrowings except as expressly
provided in this Agreement without the written consent of each Lender directly
affected thereby; provided, however, that only the consent of the Required
Lenders shall be necessary (i) to amend the definition of “Default Rate” or to
waive any obligation of Borrower to pay interest or Letter of Credit Fees at the
Default Rate, or (ii) to amend any financial covenant hereunder (or any defined
term used therein);

(e)           change Section 2.16 or Section 8.3 in a manner that would alter
the pro rata sharing of payments required thereby without the written consent of
each Lender;

(f)           change the voting percentage of the Commitments or of the
aggregate unpaid principal amount of the Loans that is required for the Lenders,
or any of them, to take any action hereunder (e.g., the provisions of this
Section 10.1 or the definition of the term “Required Lenders”), without the
written consent of each Lender;

(g)           amend this or any provision requiring consent of all Lenders for
action by the Lenders or Administrative Agent, without the written consent of
each Lender; or

(h)           discharge Borrower, Guarantor or any Permitted Affiliate, or
release all or substantially all of the collateral securing the Obligations, if
any, without the written consent of each Lender, except as otherwise may be
provided in the Loan Documents (including Section 9.10 hereof, which permits the
release of a Permitted Affiliate without the consent of the Lenders under the
terms and conditions set forth therein), or except where only the consent of the
Required Lenders is expressly required by any Loan Document;

and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer under this Agreement or any Issuer
Document relating to any Letter of Credit issued or to be issued by it; (ii) no
amendment, waiver or consent shall, unless in writing and signed by the Swing
Line Lender in addition to the Lenders required above, affect the rights or
duties of the Swing Line Lender under this Agreement; (iii) no amendment, waiver
or consent shall, unless in writing and signed by Administrative Agent in
addition to the Lenders required above, affect the rights or duties of
Administrative Agent under this Agreement or any other Loan Document; and (iv)
the Engagement Letter may be amended, or rights or privileges thereunder waived,
in a writing executed only by the parties thereto.  Notwithstanding anything to
the contrary herein, no Defaulting Lender shall have any right to approve or
disapprove any amendment, waiver or consent hereunder, except that the
Commitment of such Lender may not be increased or extended without the consent
of such Lender.

 
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10.2           Notices; Effectiveness; Electronic Communication.

(a)           Notices Generally.  Except in the case of notices and other
communications expressly permitted to be given by telephone (and except as
provided in Section 10.2(b) below), all notices and other communications
provided for herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail or sent by
facsimile as follows, and all notices and other communications expressly
permitted hereunder to be given by telephone shall be made to the applicable
telephone number, as follows:

(i)            if to Borrower, Administrative Agent, the L/C Issuer or the Swing
Line Lender, to the address, facsimile number, electronic mail address or
telephone number specified for such Person on Schedule 1.2; and

(ii)           if to any other Lender, to the address, facsimile number,
electronic mail address or telephone number specified in its Administrative
Questionnaire.

Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received; notices sent
by facsimile shall be deemed to have been given when sent (except that if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next business day for the
recipient).  Notices delivered through electronic communications to the extent
provided in Section 10.2(b) below, shall be effective as provided in such
Section 10.2(b).

(b)           Electronic Communications.  (i) Notices and other communications
to the Lenders and the L/C Issuer hereunder may be delivered or furnished by
electronic communication (including e-mail and Internet or intranet websites)
pursuant to procedures approved by Administrative Agent, provided that the
foregoing shall not apply to notices to any Lender or the L/C Issuer pursuant to
Article 2 if such Lender or the L/C Issuer, as applicable, has notified
Administrative Agent that it is incapable of receiving notices under such
Article by electronic communication.  Administrative Agent or Borrower may, in
its discretion, agree to accept notices and other communications to it hereunder
by electronic communications pursuant to procedures approved by it, provided
that approval of such procedures may be limited to particular notices or
communications, and (ii) unless Administrative Agent otherwise prescribes, (y)
notices and other communications sent to an e-mail address shall be deemed
received upon the sender’s receipt of an acknowledgement from the intended
recipient (such as by the “return receipt requested” function, as available,
return e-mail or other written acknowledgement), provided that if such notice or
other communication is not sent during the normal business hours of the
recipient, such notice or communication shall be deemed to have been sent at the
opening of business on the next business day for the recipient, and (z) notices
or communications posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail address
as described in the foregoing clause (y) of notification that such notice or
communication is available and identifying the website address therefor.

 
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(c)           The Platform.  THE PLATFORM IS PROVIDED “AS IS” AND “AS
AVAILABLE.” THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR
COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND
EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER
MATERIALS.  NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING
ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE
DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR
THE PLATFORM.  In no event shall Administrative Agent or any of its Related
Parties (collectively, the “Agent Parties”) have any liability to Borrower,
Guarantor, any Lender, the L/C Issuer or any other Person for losses, claims,
damages, liabilities or expenses of any kind (whether in tort, contract or
otherwise) arising out of Borrower’s, Guarantor’s or Administrative Agent’s
transmission of Borrower Materials through the Internet, except to the extent
that such losses, claims, damages, liabilities or expenses are determined by a
court of competent jurisdiction by a final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Agent Party;
provided, however, that in no event shall any Agent Party have any liability to
Borrower, Guarantor, any Lender, the L/C Issuer or any other Person for
indirect, special, incidental, consequential or punitive damages (as opposed to
direct or actual damages).

(d)           Change of Address, Etc. Each of Borrower, Administrative Agent,
the L/C Issuer and the Swing Line Lender may change its address, facsimile or
telephone number for notices and other communications hereunder by notice to the
other parties hereto.  Each other Lender may change its address, facsimile or
telephone number for notices and other communications hereunder by notice to
Borrower, Administrative Agent, the L/C Issuer and the Swing Line Lender.  In
addition, each Lender agrees to notify Administrative Agent from time to time to
ensure that Administrative Agent has on record (i) an effective address, contact
name, telephone number, facsimile number and electronic mail address to which
notices and other communications may be sent and (ii) accurate wire instructions
for such Lender.

(e)           Reliance by Administrative Agent, L/C Issuer and
Lenders.  Administrative Agent, the L/C Issuer and the Lenders shall be entitled
to rely and act upon any notices (including telephonic Notices of Borrowing)
purportedly given by or on behalf of Borrower by a Person identifying himself or
herself as a Responsible Officer, even if (i) such notices were not made in a
manner specified herein, were incomplete or were not preceded or followed by any
other form of notice specified herein, or (ii) the terms thereof, as understood
by the recipient, varied from any confirmation thereof.  Borrower shall
indemnify Administrative Agent, the L/C Issuer, each Lender and the Related
Parties of each of them from all losses, costs, expenses and liabilities
resulting from the reliance by such Person on each notice purportedly given by
or on behalf of Borrower by a Person identifying himself or herself as a
Responsible Officer.  All telephonic notices to and other telephonic
communications with Administrative Agent may be recorded by Administrative
Agent, and each of the parties hereto hereby consents to such recording.

(f)           Communication with Lenders; Availability of Documents.  All
communications from Administrative Agent to the Lenders requesting the Lenders’
determination, consent, approval or disapproval (a) shall be given in the form
of a written notice to each Lender, (b) shall be accompanied by a description of
the matter or time as to which such determination, approval, consent or
disapproval is requested, or shall advise each Lender where such matter or item
may be inspected, or shall otherwise describe the matter or issue to be
resolved, and (c) shall include Administrative Agent’s recommended course of
action or determination in respect thereof.  Each Lender shall reply promptly,
but in any event within ten (10) Business Days after receipt of the request from
Administrative Agent (the “Lender Reply Period”).  Unless a Lender shall give
written notice to Administrative Agent that it objects to the recommendation or
determination of Administrative Agent (together with a written explanation of
the reasons behind such objection) within the Lender Reply Period, such Lender
shall be deemed to have approved of or consented to such recommendation or
determination.  With respect to decisions requiring the approval of the Required
Lenders or all the Lenders, Administrative Agent shall submit its recommendation
or determination for approval of or consent to such recommendation or
determination to all Lenders and upon receiving the required approval or consent
shall follow the course of action or determination of the Required Lenders (and
each nonresponding Lender shall be deemed to have concurred with such
recommended course of action) or all the Lenders, as the case may
be.  Administrative Agent will make available to the Lenders copies of the Loan
Documents and any notices of default given to Borrower and, to the extent made
available to Administrative Agent pursuant to the terms of this Agreement,
copies of the organizational documents and financial information of Borrower,
Guarantor and the Permitted Affiliates.

 
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10.3         No Waiver; Cumulative Remedies.  No failure by any Lender, the L/C
Issuer or Administrative Agent to exercise, and no delay by any such Person in
exercising, any right, remedy, power or privilege hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege.  The rights,
remedies, powers and privileges herein provided are cumulative and not exclusive
of any rights, remedies, powers and privileges provided by law.

10.4         Costs and Expenses; Indemnity; Waiver of Consequential Damages,
Etc.

(a)           Costs and Expenses.  Borrower shall pay (i) all reasonable
out-of-pocket expenses incurred by Administrative Agent and its Affiliates
(including the reasonable fees, charges and disbursements of counsel for
Administrative Agent), in connection with the syndication of the credit
facilities provided for herein, the preparation, negotiation, execution and
delivery of this Agreement and the other Loan Documents or any amendments,
modifications or waivers of the provisions hereof or thereof (whether or not the
transactions contemplated hereby or thereby shall be consummated), and (ii) all
reasonable out-of-pocket expenses incurred by Administrative Agent, any Lender
or the L/C Issuer (including the fees, charges and disbursements of any counsel
for Administrative Agent, any Lender or the L/C Issuer), and shall pay all fees
and time charges for attorneys who may be employees of Administrative Agent, any
Lender or the L/C Issuer, in connection with the enforcement or protection of
its rights (A) in connection with this Agreement and the other Loan Documents,
including its rights under this Section, or (B) in connection with the Loans
made or Letters of Credit issued hereunder, including all such out-of-pocket
expenses incurred during any workout, restructuring or negotiations in respect
of such Loans or Letters of Credit.

 
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(b)           Indemnification by the Borrower.  Borrower shall indemnify
Administrative Agent (and any sub-agent thereof), each Lender and the L/C
Issuer, and each Related Party of any of the foregoing Persons (each such Person
being called an “Indemnitee”) against, and hold each Indemnitee harmless from,
any and all losses, claims, damages, liabilities and related expenses (including
the fees, charges and disbursements of any counsel for any Indemnitee), and
shall indemnify and hold harmless each Indemnitee from all fees and time charges
and disbursements for attorneys who may be employees of any Indemnitee, incurred
by any Indemnitee or asserted against any Indemnitee by any third party or by
Borrower, Guarantor or any Permitted Affiliate arising out of, in connection
with, or as a result of (i) the execution or delivery of this Agreement, any
other Loan Document or any agreement or instrument contemplated hereby or
thereby, the performance by the parties hereto of their respective obligations
hereunder or thereunder, the consummation of the transactions contemplated
hereby or thereby, or, in the case of Administrative Agent (and any sub-agent
thereof) and its Related Parties only, the administration of this Agreement and
the other Loan Documents, (ii) any Loan or Letter of Credit or the use or
proposed use of the proceeds therefrom (including any refusal by the L/C Issuer
to honor a demand for payment under a Letter of Credit if the documents
presented in connection with such demand do not strictly comply with the terms
of such Letter of Credit), (iii) any actual or alleged presence or release of
Hazardous Substances on or from any property owned or operated by Borrower or
any of its subsidiaries, or any liability under any Environmental Laws related
in any way to Borrower or any of its subsidiaries, or (iv) any actual or
prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory, whether
brought by a third party or by Borrower, Guarantor or any Permitted Affiliate,
and regardless of whether any Indemnitee is a party thereto; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses (x) are determined by a
court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Indemnitee or
(y) result from a claim brought by Borrower, Guarantor or any Permitted
Affiliate against an Indemnitee for breach in bad faith of such Indemnitee’s
obligations hereunder or under any other Loan Document, if Borrower, Guarantor
or such Permitted Affiliate has obtained a final and nonappealable judgment in
its favor on such claim as determined by a court of competent jurisdiction.

(c)           Reimbursement by Lenders.  To the extent that Borrower for any
reason fails to indefeasibly pay any amount required under Sections 10.4(a) or
(b) to be paid by it to Administrative Agent (or any sub-agent thereof), the L/C
Issuer or any Related Party of any of the foregoing, each Lender severally
agrees to pay to Administrative Agent (or any such sub-agent), the L/C Issuer or
such Related Party, as the case may be, such Lender’s Pro Rata Share (determined
as of the time that the applicable unreimbursed expense or indemnity payment is
sought) of such unpaid amount, provided that the unreimbursed expense or
indemnified loss, claim, damage, liability or related expense, as the case may
be, was incurred by or asserted against Administrative Agent (or any such
sub-agent) or the L/C Issuer in its capacity as such, or against any Related
Party of any of the foregoing acting for Administrative Agent (or any such
sub-agent) or L/C Issuer in connection with such capacity.  The obligations of
the Lenders under this Section 10.4(c) are subject to the provisions of Section
2.14.2.

(d)           Payments.  All amounts due under this Section shall be payable not
later than fifteen days after demand therefor.

 
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(e)           Survival.  The agreements in this Section shall survive the
resignation of Administrative Agent and the L/C Issuer, the replacement of any
Lender, the termination of the Commitments and the repayment, satisfaction or
discharge of all the other Obligations.

10.5         Successors and Assigns.

(a)           Successors and Assigns Generally.  The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby, except that
Borrower may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of Administrative Agent and each
Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of Section 10.5(b), (ii) by way of participation in accordance with
the provisions of Section 10.5(d), or (iii) by way of pledge or assignment of a
security interest subject to the restrictions of Section 10.5(f).  Nothing in
this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in Section 10.5(d) and, to
the extent expressly contemplated hereby, the Related Parties of each of
Administrative Agent, the L/C Issuer and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

(b)           Assignment by Lenders.  Any Lender may at any time assign to one
or more Eligible Assignees all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Commitment and the Loans
(including for purposes of this clause (a), participations in L/C Obligations
and in Swing Loans) at the time owing to it; provided that (i) except in the
case of an assignment of the entire remaining amount of the assigning Lender’s
Commitment and the Loans at the time owing to it or in the case of an assignment
to a Lender or an Affiliate of a Lender or an Approved Fund with respect to a
Lender, the aggregate amount of the Commitment (which for this purpose includes
Loans outstanding thereunder) subject to each such assignment, determined as of
the date the Assignment and Assumption with respect to such assignment is
delivered to Administrative Agent or, if “Trade Date” is specified in the
Assignment and Assumption, as of the Trade Date, shall not be less than
$5,000,000 unless each of Administrative Agent and, so long as no Event of
Default has occurred and is continuing, Borrower otherwise consents (each such
consent not to be unreasonably withheld or delayed), provided that concurrent
assignments to members of an Assignee Group and concurrent assignments from
members of an Assignee Group to a single Eligible Assignee (or to an Eligible
Assignee and members of its Assignee Group) will be treated as a single
assignment for purposes of determining whether such minimum amount has been met;
(ii) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement
with respect to the Loans or the Commitment assigned, except that this clause
(ii) shall not apply to rights in respect of Swing Loans; (iii) any assignment
of a Commitment must be approved by Administrative Agent, the L/C Issuer and the
Swing Line Lender (which consent will not be unreasonably withheld or delayed)
unless the Person that is the proposed assignee is itself a Lender (whether or
not the proposed assignee would otherwise qualify as an Eligible Assignee); and
(iv) the parties to each assignment shall execute and deliver to Administrative
Agent an Assignment and Assumption, together with a processing and recordation
fee in the amount, if any, required as set forth in Schedule 1.4, and the
Eligible Assignee, if it shall not be a Lender, shall deliver to Administrative
Agent an Administrative Questionnaire.  Subject to acceptance and recording
thereof by Administrative Agent pursuant to clause (b) of this Section, from and
after the effective date specified in each Assignment and Assumption, the
Eligible Assignee thereunder shall be a party to this Agreement and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of Sections
3.1, 3.3, 3.4, and 10.4 with respect to facts and circumstances occurring prior
to the effective date of such assignment).  Upon request, Borrower (at its
expense) shall execute and deliver a Revolving Note and Note to the assignee
Lender and, in such event, the assigning Lender shall return the original
Revolving Note and Note for cancellation and, if the assignment is for a portion
of the assigning Lender’s Commitment, replacement by a new Revolving Note issued
by Borrower and evidencing the assigning Lender’s reduced Commitment.  Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this Section shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with clause (d) of this Section.  Notwithstanding the
foregoing, assignment of the obligations of the L/C Issuer after the resignation
of PNC Bank as L/C Issuer, or any other successor thereafter acting as L/C
Issuer, shall be governed by Section 10.5(h) hereof.

 
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(c)           Register.  Administrative Agent, acting solely for this purpose as
an agent of Borrower, shall maintain at Administrative Agent’s Office a copy of
each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amounts of the Loans and L/C Obligations owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”).  The entries in
the Register shall be conclusive, and Borrower, Administrative Agent and the
Lenders may treat each Person whose name is recorded in the Register pursuant to
the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary.  The Register shall be available for
inspection by each of Borrower and the L/C Issuer at any reasonable time and
from time to time upon reasonable prior notice.  In addition, at any time that a
request for a consent for a material or substantive change to the Loan Documents
is pending, any Lender may request and receive from Administrative Agent a copy
of the Register.

(d)           Participations.  Any Lender may at any time, without the consent
of, or notice to, Borrower or Administrative Agent, sell participations to any
Person (other than a natural person or Borrower or any of Borrower’s Affiliates
or subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and/or the Loans (including such Lender’s participations in L/C
Obligations and/or Swing Loans) owing to it); provided that (i) such Lender’s
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (iii) Borrower, Guarantor, each Permitted Affiliate,
Administrative Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.  Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, waiver or other modification
described in clauses (a)-(g) of Section 10.1 that directly affects such
Participant.  Subject to clause (e) of this Section, Borrower agrees that each
Participant shall be entitled to the benefits of Sections 3.1, 3.3, 3.4, and
10.4 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to clause (b) of this Section.

 
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(e)           Limitations on Participant Rights.  A Participant shall not be
entitled to receive any greater payment under Section 3.1 or 3.3 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant.  A Participant that would be a Foreign
Lender if it were a Lender shall not be entitled to the benefits of Section 3.1
unless Borrower is notified of the participation sold to such Participant and
such Participant agrees, for the benefit of Borrower, to comply with Sections
3.1.5 and 3.3.3 as though it were a Lender.

(f)           Certain Pledges.  Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement
(including under its Note, if any) to secure obligations of such Lender,
including any pledge or assignment to secure obligations to a Federal Reserve
Bank; provided that no such pledge or assignment shall release such Lender from
any of its obligations hereunder or substitute any such pledgee or assignee for
such Lender as a party hereto.

(g)           Electronic Execution of Assignments.  The words “execution,”
“signed,” “signature,” and words of like import in any Assignment and Assumption
shall be deemed to include electronic signatures or the keeping of records in
electronic form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any other similar state laws based on the Uniform Electronic Transactions
Act.

(h)           Resignation as L/C Issuer or Swing Line Lender after
Assignment.  Notwithstanding anything to the contrary contained herein, if at
any time PNC Bank assigns all of its Commitment and Loans pursuant to clause (a)
above, PNC Bank may, (i) upon 30 days’ notice to Borrower and the Lenders,
resign as L/C Issuer and/or (ii) upon 30 days’ notice to Borrower, resign as
Swing Line Lender.  In the event of any such resignation as L/C Issuer or Swing
Line Lender, Borrower shall be entitled to appoint from among the Lenders a
successor L/C Issuer or Swing Line Lender hereunder and, if such designated
appointee agrees to act as successor L/C Issuer or Swing Line Lender hereunder,
Lenders hereby agree to accept such appointment; provided, however, that no
failure by Borrower to appoint any such successor shall affect the resignation
of PNC Bank as L/C Issuer or Swing Line Lender, as the case may be.  In
addition, if PNC Bank fails to issue a Letter of Credit under Section 2.1.2(b)
hereof because the issuance of such Letter of Credit would violate any of its
policies.  PNC Bank will, upon the request of Borrower, resign as L/C Issuer
hereunder and Borrower shall be entitled to appoint from among the Lenders a
successor L/C Issuer hereunder and, if such designated appointee agrees to act
as successor L/C Issuer hereunder, Lenders hereby agree to accept such
appointment; provided, however, that no failure by Borrower to appoint any such
successor shall affect the resignation of PNC Bank as L/C Issuer.  If PNC Bank
resigns as L/C Issuer, it shall retain all the rights and obligations of the L/C
Issuer hereunder with respect to all Letters of Credit outstanding as of the
effective date of its resignation as L/C Issuer and all L/C Obligations with
respect thereto (including the right to require the Lenders to make Reference
Rate Loans or fund risk participations in Unreimbursed Amounts pursuant to
Section 2.5.1).  If PNC Bank resigns as Swing Line Lender, it shall retain all
the rights of the Swing Line Lender provided for hereunder with respect to Swing
Loans made by it and outstanding as of the effective date of such resignation,
including the right to require the Lenders to make Reference Rate Loans or fund
risk participations in outstanding Swing Loans pursuant to Section 2.2.5.  Upon
the appointment of a successor L/C Issuer and/or Swing Line Lender, (a) such
successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring L/C Issuer or Swing Line Lender, as the
case may be, and (b) the successor L/C Issuer shall issue letters of credit in
substitution for the Letters of Credit, if any, outstanding at the time of such
succession or make other arrangements satisfactory to PNC Bank to effectively
assume the obligations of PNC Bank with respect to such Letters of Credit.

 
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10.6           Confidentiality.  Each of Administrative Agent, the Lenders and
the L/C Issuer agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its Affiliates
and to its and its Affiliates’ respective partners, directors, officers,
employees, agents, advisors and representatives (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority
purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to this Agreement or any other Loan Document or
the enforcement of rights hereunder or thereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section, to (i)
any assignee of or Participant in, or any prospective assignee of or Participant
in, any of its rights or obligations under this Agreement or (ii) any actual or
prospective counterparty (or its advisors) to any swap or derivative transaction
relating to Borrower and its obligations, (g) with the consent of Borrower or
(h) to the extent such Information (x) becomes publicly available other than as
a result of a breach of this Section or (y) becomes available to Administrative
Agent, any Lender, the L/C Issuer or any of their respective Affiliates on a
nonconfidential basis from a source other than Borrower.

For purposes of this Section, “Information” means all information received from
Borrower or any subsidiary thereof relating to Borrower or any subsidiary
thereof or any of their respective businesses, other than any such information
that is available to Administrative Agent, any Lender or the L/C Issuer on a
nonconfidential basis prior to disclosure by Borrower or any subsidiary thereof,
provided that, in the case of information received from Borrower or any
subsidiary thereof after the date hereof, such information is clearly identified
at the time of delivery as confidential.  Any Person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.

 
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Each of Administrative Agent, the Lenders and the L/C Issuer acknowledges that
(a) the Information may include material non-public information concerning
Borrower or a subsidiary thereof, as the case may be, (b) it has developed
compliance procedures regarding the use of material non-public information and
(c) it will handle such material non-public information in accordance with
applicable Law, including Federal and state securities Laws.

10.7         Right of Setoff.  If an Event of Default shall have occurred and be
continuing, each Lender and the L/C Issuer is hereby authorized at any time and
from time to time, to the fullest extent permitted by applicable law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final, in whatever currency) at any time held and other obligations (in
whatever currency) at any time owing by such Lender or the L/C Issuer to or for
the credit or the account of Borrower against any and all of the obligations of
Borrower now or hereafter existing under this Agreement or any other Loan
Document to such Lender or the L/C Issuer, irrespective of whether or not such
Lender or the L/C Issuer shall have made any demand under this Agreement or any
other Loan Document and although such obligations of Borrower may be contingent
or unmatured or are owed to a branch or office of such Lender or the L/C Issuer
different from the branch or office holding such deposit or obligated on such
indebtedness.  The rights of each Lender and the L/C Issuer under this Section
are in addition to other rights and remedies (including other rights of setoff)
that such Lender, the L/C Issuer or their respective Affiliates may have.  Each
Lender and the L/C Issuer agrees to notify Borrower and Administrative Agent
promptly after any such setoff and application, provided that the failure to
give such notice shall not affect the validity of such setoff and application.

10.8         No Third Parties Benefited.  This Agreement is made and entered
into for the sole protection and benefit of the parties signing this Agreement
and their successors and assigns.  No trust is created by this Agreement and no
other persons or entities shall have any right of action under this Agreement or
any right to the Loan funds.

10.9         Payments Set Aside.  To the extent that any payment by or on behalf
of Borrower, Guarantor or any Permitted Affiliate is made to Administrative
Agent, the L/C Issuer or any Lender, or Administrative Agent, the L/C Issuer or
any Lender exercises its right of setoff, and such payment or the proceeds of
such setoff or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by Administrative Agent, the L/C Issuer or such Lender
in its discretion) to be repaid to a trustee, receiver or any other party, in
connection with any Insolvency Proceeding or otherwise, then (a) to the extent
of such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred, and (b) each Lender
and the L/C Issuer severally agrees to pay to Administrative Agent upon demand
its applicable share (without duplication) of any amount so recovered from or
repaid by Administrative Agent, plus interest thereon from the date of such
demand to the date such payment is made at a rate per annum equal to the Federal
Funds Rate from time to time in effect.  The obligations of the Lenders and the
L/C Issuer under clause (b) of the preceding sentence shall survive the payment
in full of the Obligations and the termination of this Agreement.

 
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10.10       Counterparts; Integration; Effectiveness.  This Agreement may be
executed in counterparts (and by different parties hereto in different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract.  This Agreement and the other
Loan Documents constitute the entire contract among the parties relating to the
subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof.  This
Agreement shall become effective when it shall have been executed by
Administrative Agent and when Administrative Agent shall have received
counterparts hereof that, when taken together, bear the signatures of each of
the other parties hereto.  Delivery of an executed counterpart of a signature
page of this Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Agreement.

10.11       Survival of Representations and Warranties.  All representations and
warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof.  Such
representations and warranties have been or will be relied upon by
Administrative Agent and each Lender, regardless of any investigation made by
Administrative Agent or any Lender or on their behalf and notwithstanding that
Administrative Agent or any Lender may have had notice or knowledge of any
Default or Event of Default at the time of any credit extension, and shall
continue in full force and effect as long as any Loan or any other Obligation
hereunder shall remain unpaid or unsatisfied or any Letter of Credit shall
remain outstanding.

10.12       Severability.  If any provision of this Agreement or the other Loan
Documents is held to be illegal, invalid or unenforceable, (a) the legality,
validity and enforceability of the remaining provisions of this Agreement and
the other Loan Documents shall not be affected or impaired thereby and (b) the
parties shall endeavor in good faith negotiations to replace the illegal,
invalid or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the illegal, invalid or
unenforceable provisions.  The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

10.13       Replacement of Lenders.  If any Lender requests compensation under
Section 3.4, or if the Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 3.1 or Section 3.3, or if any Lender is a Defaulting Lender, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in, and
consents required by, Section 10.5), all of its interests, rights and
obligations under this Agreement and the related Loan Documents to an assignee
that shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment), provided that:

(a)           the Borrower shall have paid to Administrative Agent the
assignment fee specified in Section 10.5(b);

(b)           such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans and L/C Advances, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder and under the other
Loan Documents (including any amounts under Section 3.4) from the assignee (to
the extent of such outstanding principal and accrued interest and fees) or the
Borrower (in the case of all other amounts);

 
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(c)           in the case of any such assignment resulting from a claim for
compensation under Section 3.3 or payments required to be made pursuant to
Section 3.1, such assignment will result in a reduction in such compensation or
payments thereafter; and

(d)           such assignment does not conflict with applicable Laws.

(e)           A Lender shall not be required to make any such assignment or
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment
and delegation cease to apply.

10.14       Governing Law; Jurisdiction; Etc.

(a)           GOVERNING LAW.  THIS AGREEMENT IS TO BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF CALIFORNIA (AS PERMITTED
BY SECTION 1646.5 OF THE CALIFORNIA CIVIL CODE OR ANY SIMILAR SUCCESSOR
PROVISION), WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW RULE THAT WOULD CAUSE THE
APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE INTERNAL LAWS OF THE
STATE OF CALIFORNIA TO THE RIGHTS AND DUTIES OF THE PARTIES.

(b)           SUBMISSION TO JURISDICTION.  BORROWER AND ADMINISTRATIVE AGENT
EACH IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO
THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA SITTING
IN SAN FRANCISCO COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE NORTHERN
DISTRICT OF CALIFORNIA, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT
OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH CALIFORNIA
STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH
FEDERAL COURT.  EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY
SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY
LAW.  NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY
RIGHT THAT ADMINISTRATIVE AGENT, ANY LENDER OR THE L/C ISSUER MAY OTHERWISE HAVE
TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AGAINST THE BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION WHERE THE BORROWER OR ITS PROPERTIES ARE LOCATED.

 
88

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(c)           WAIVER OF VENUE.  BORROWER AND ADMINISTRATIVE AGENT EACH
IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS
SECTION.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

(d)           SERVICE OF PROCESS.  EACH PARTY HERETO IRREVOCABLY CONSENTS TO
SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION
10.2(a).  NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

10.15       Waiver of Jury Trial.  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

10.16       Judicial Reference.  If any action or proceeding by or against any
party hereto in connection with any of the transactions contemplated by this
Agreement or any other Loan Document is filed in a forum in which predispute
waivers of the right to trial by jury are invalid under applicable law, (a) the
court shall, and is hereby directed to, make a general reference pursuant to
California Code of Civil Procedure Section 638 (or similar applicable law) to a
referee (who shall be a single active or retired judge) to hear and determine
all of the issues in such action or proceeding (whether of fact or of law) and
to report a statement of decision, provided that at the option of any party to
such proceeding, any such issues pertaining to a “provisional remedy” (or
similar term) as defined in California Code of Civil Procedure Section 1281.8
(or similar applicable law) shall be heard and determined by the court, and (b)
the prevailing party, or the non-dismissing party in the event of a voluntary
dismissal by the party instituting the action, shall be entitled to the full
amount of all fees and expenses of any referee appointed in such action or
proceeding.

 
89

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10.17       USA PATRIOT Act Notice.  Each Lender that is subject to the Act (as
hereinafter defined) and Administrative Agent (for itself and not on behalf of
any Lender) hereby notifies Borrower that pursuant to the requirements of the
USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the “Act”), it is required to obtain, verify and record information that
identifies Borrower, which information includes the name and address of Borrower
and other information that will allow such Lender or Administrative Agent, as
applicable, to identify Borrower in accordance with the Act.

10.18       Time of the Essence.  Time is of the essence of the Loan Documents.

10.19       No Fiduciary Relationship.  In connection with all aspects of each
transaction contemplated by the Loan Documents, Borrower, Guarantor and each
Permitted Affiliate acknowledges and agrees that: (i) the Loan Documents and any
related arranging or other services described in any of the Loan Documents (or
in any commitment letter by PNC Bank, the Arranger or any affiliate thereof) is
an arm’s-length commercial transaction between Borrower and its affiliates, on
the one hand, and the Arranger, on the other hand, and Borrower, Guarantor, each
Permitted Affiliate and their respective affiliates are capable of evaluating
and understanding and understand and accept the terms, risks and conditions of
the transactions contemplated by the Loan Documents; (ii) in connection with the
process leading to such transaction, PNC Bank and the Arranger each is and has
been acting solely as a principal and is not the financial advisor, agent or
fiduciary, for Borrower, Guarantor, any Permitted Affiliate or any of their
respective affiliates, stockholders, creditors or employees or any other party;
(iii) neither PNC Bank nor the Arranger has assumed or will assume an advisory,
agency or fiduciary responsibility in Borrower’s, Guarantor’s, any Permitted
Affiliate’s or any of their respective affiliates’ favor with respect to any of
the transactions contemplated by the Loan Documents or the process leading
thereto (irrespective of whether PNC Bank or the Arranger has advised or is
currently advising any such Person or its affiliates on other matters) and
neither PNC Bank nor the Arranger has any obligation to Borrower, Guarantor, any
Permitted Affiliate or any of their respective affiliates with respect to the
transactions contemplated by the Loan Documents except those obligations
expressly set forth herein and therein; (iv) PNC Bank and the Arranger and their
respective affiliates may be engaged in a broad range of transactions that
involve interests that differ from those of Borrower, Guarantor, the Permitted
Affiliates and their respective affiliates and PNC Bank and the Arranger have no
obligation to disclose any of such interests by virtue of any advisory, agency
or fiduciary relationship; and (v) PNC Bank and the Arranger have not provided
any legal, accounting, regulatory or tax advice with respect to any of the
transactions contemplated by the Loan Documents and Borrower, Guarantor, any
Permitted Affiliate and their respective affiliates have consulted their own
legal, accounting, regulatory and tax advisors to the extent they have deemed
appropriate.  Borrower, Guarantor and each Permitted Affiliate hereby waive and
release, to the fullest extent permitted by law, any claims that it may have
against PNC Bank and the Arranger with respect to any breach or alleged breach
of agency or fiduciary duty relating to the transactions contemplated by the
Loan Documents.

[Remainder of page intentionally left blank]

 
90

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IN WITNESS WHEREOF, Borrower and the other parties hereto have executed this
Agreement as of the date first above written.
 
ESSEX PORTFOLIO, L.P.,
a California limited partnership

BY:
ESSEX PROPERTY TRUST, INC.,
   
a Maryland corporation, its general partner
           
By:
       
Jordan E. Ritter
     
Senior Vice President
                   
925 East Meadow Drive
   
Palo Alto, CA 94303
   
Attn:
Mark J. Mikl (facsimile: (650) 843-1514)
     
Jordan E. Ritter (facsimile: (650) 858-1372)
     
Michael T. Dance (facsimile: (650) 858-0139)
   
Internet Website: www.essexpropertytrust.com
 

 
[Signatures Continue on the Next Page]

 

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PNC BANK, NATIONAL ASSOCIATION,
as Administrative Agent

By:
     
Karen J. Kennedy, Vice President
 

 
[Signatures Continue on the Next Page]

 

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PNC BANK, NATIONAL ASSOCIATION,
as L/C Issuer, Swing Line Lender and Lender
 

By:
     
Karen J. Kennedy, Vice President
 

[Signatures Continue on the Next Page]

 

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UNION BANK, N.A.,
as Lender

By:
     
Name:
     
Title:
   

 
[Signatures Continue on the Next Page]

 

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COMERICA BANK,
as Lender

By:
     
Casey L. Stevenson
   
Title:
   

[Signatures Continue on the Next Page]

 

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KEYBANK NATIONAL ASSOCIATION,
as Lender

By:
     
Jason R. Weaver, Senior Vice President
 

 
[Signatures Continue on the Next Page]

 

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US BANK, NATIONAL ASSOCIATION
as Lender

By:
     
Ben Lewis, Vice President
 

[Signatures Continue on the Next Page]

 

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CHEVY CHASE BANK, F.S.B.,
as Lender
 

By:
     
Name:
   
Title:
 

 
[Signatures Continue on the Next Page]

 

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WELLS FARGO BANK, NATIONAL ASSOCIATION
as Lender
 

By:
     
Torsten Galley, Vice President
 

 

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CONSENT OF GUARANTOR

Reference is made to that certain Revolving Credit Agreement dated as of
December 18, 2009 (the “Credit Agreement”).
 
Essex Property Trust, Inc., a Maryland corporation, as the “Guarantor” under the
Credit Agreement (a) acknowledges and consents to the Credit Agreement, (b)
makes the representations set forth in Article 7 of the Credit Agreement that
apply to Guarantor, and (c) agrees to be bound by the covenants of Articles 6
and 10 of the Credit Agreement that apply to Guarantor.
 

Dated as of December 18, 2009

ESSEX PROPERTY TRUST, INC.,
a Maryland corporation, as Guarantor

By:
     
Jordan E. Ritter
   
Senior Vice President
 

925 East Meadow Drive
Palo Alto, CA 94303
Attn.: Mark J. Mikl, Jordan E. Ritter and Michael T. Dance

 

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CONSENT OF PERMITTED AFFILIATES
 
Reference is made to that certain Revolving Credit Agreement dated as of
December 18, 2009 (the “Credit Agreement”).
 
Each of the undersigned, as “Permitted Affiliates” under the Credit Agreement,
(a) acknowledges and consents to the Credit Agreement, (b) makes the
representations set forth in Article 7 of the Credit Agreement that apply to
such Permitted Affiliate, and (c) agrees to be bound by the covenants of
Articles 6 and 10 of the Credit Agreement that apply to such Permitted
Affiliate.
 
Dated as of December 18, 2009

PERMITTED AFFILIATES:

JMS ACQUISITION LLC, a Delaware limited liability company
 
ESSEX PARK BOULEVARD, LLC, a Delaware limited liability company
     
By:
ESSEX PORTFOLIO, L.P., a California limited partnership, its sole member
 
By:
Essex Portfolio, L.P., a California limited partnership, its sole member
           
By:
Essex Property Trust, Inc., a Maryland corporation, its general partner
   
By:
Essex Property Trust, Inc., a Maryland corporation, its general partner
                 
By: 
       
By:  
       
Name:
       
Name:
     
Title:
       
Title:

 
[Signatures Continue on Following Pages]

 

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ESSEX BRIDLE TRAILS, L.P., a California limited partnership
 
ESSEX CHESTNUT APARTMENTS, L.P., a California limited partnership
     
By:
Essex Management Corporation, a California corporation, its general partner
 
By:
Essex SPE, LLC, a Delaware limited liability company, its general partner
           
By:
     
By:
Essex Portfolio, L.P., a California limited partnership, its sole member
   
Name:
           
Title:
   
By:
Essex Property Trust, Inc., a Maryland corporation, its general partner
                         
By:
               
Name:
             
Title:

ESSEX COLUMBUS LLC, a Delaware limited liability company
 
ESSEX MARINA CITY CLUB, L.P., a California limited partnership
         
By:
Essex Columbus, Inc.,
 
By:
Essex MCC, LLC,
 
a California corporation,
   
a Delaware limited liability company,
 
its managing member
   
its general partner
               
By:
     
By:
Essex Portfolio, L.P.,
   
Name:
     
a California limited partnership,
   
Title:
     
its sole member
                           
By:
Essex Property Trust, Inc., a Maryland corporation, its general partner
                               
By:
                 
Name:
               
Title:

 

[Signatures Continue on Following Pages]

 

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NEWPORT BEACH NORTH LLC, a Delaware limited liability company
 
ESSEX EUCLID, LLC, a Delaware limited liability company
         
By:
Newport Beach North, Inc.,
 
By:
Essex Portfolio, L.P.,
 
a Delaware corporation,
   
a California limited partnership,
 
its managing member
   
its sole member
               
By:  
     
By:
Essex Property Trust, Inc., a Maryland corporation, its general partner
   
Name:
             
Title:
     
By:  
             
Name:
             
Title:

ESSEX BLUFFS, L.P., a California limited partnership
 
ESSEX SUNPOINTE LTD., a California limited partnership
         
By:
Essex Management Corporation, a California corporation, its general partner
 
By:
Essex Portfolio, L.P., a California limited partnership, its general partner
               
By:  
     
By:
Essex Property Trust, Inc., a Maryland corporation, its general partner
   
Name:
             
Title:
     
By:  
             
Name:
             
Title:

[Signatures Continue on Following Pages]

 

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ESSEX GLENBROOK, LLC, a Delaware limited liability company
 
ESSEX TRACY DEVELOPMENT, INC., a California corporation
     
By:
Essex Portfolio, L.P.,
       
a California limited partnership,
 
By:  
   
its sole member
   
Name:
       
Title:
 
By:
Essex Property Trust, Inc., a Maryland corporation, its general partner
   
 
               
By:  
             
Name:
           
Title:
     

ESSEX BERKELEY 4th STREET, L.P., a California limited partnership
 
JAYSAC, LTD., Texas limited partnership
     
By:
Essex Berkeley, LLC, a Delaware limited liability company, its general partner
 
By:
Jaysac GP Corp., a Delaware corporation, its general partner
       
 
 
By:
Essex Portfolio, L.P., a California limited partnership, its sole member
 
 
 
           
By:
     
By:
Essex Property Trust, Inc., a Maryland corporation, its general partner
   
 
Name:
              Title:      
By:
                 
Name:
               
Title:
   
 
 

[Signatures Continue on Following Pages]

 

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ESSEX VIEW POINTE, LLC, a Delaware limited liability company
       
By:
Essex Fidelity I Corporation, a California corporation
           
By:  
       
Name:
     
Title:
 

 
 

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EXHIBIT A-1

UNENCUMBERED STABILIZED ASSET POOL PROPERTIES

AS OF DECEMBER 18, 2009

 
PROPERTY NAME
NAME OF OWNER
#OF UNITS
LOCATION
Marina Cove #
Essex Portfolio, L.P.
292
Santa Clara, PA
Foothill Gardens
Essex Portfolio, L.P.
132
San Ramon, CA
Foothill/Twin Creeks
Essex Portfolio, L.P.
44
San Ramon, CA
Marina City Club #
Essex Marina City Club, L.P.
101
Marina Del Rey, CA
Monterra del Mar (Windsor Terrace)
Essex Portfolio, L.P.
123
Pasadena, CA
Lofts at Pinehurst, The (Villa Scandia)
Essex Portfolio, L.P.
118
Ventura, CA
Alpine Country
JMS Acquisition LLC
108
Alpine, CA
Cambridge
JMS Acquisition LLC
40
Chula Vista, CA
Mesa Village
JMS Acquisition LLC
133
Claremont, CA
Tierra del Sol/Norte
JMS Acquisition LLC
156
El Cajon, CA
Country Villas
JMS Acquisition LLC
180
Oceanside, CA
Vista Capri - North
JMS Acquisition LLC
106
San Diego, CA
Shadow Point
JMS Acquisition LLC
172
Spring Valley, CA
Salmon Run at Perry Creek
Essex Portfolio, L.P.
132
Bothell, WA
Laurels at Mill Creek
Essex Portfolio, L.P.
164
Mill Creek, WA
Linden Square
Essex Portfolio, L.P.
183
Seattle, WA
Columbus (aka Hampton Court)
Essex Columbus LLC
83
Glendale, CA
Bridle Trails
Essex Bridle Trails, L.P.
108
Kirkland, WA
Pinehurst #
Essex Portfolio, L.P.
28
Ventura, CA
Woodside Village*
Newport Beach North LLC
145
Ventura, CA
Fairway Apartments #
Essex Portfolio, L.P.
74
Newport Beach, CA
Cedar Terrace
JMS Acquisition LLC
180
Bellevue, WA
Marabella
Essex Portfolio, L.P.
60
Los Angeles, CA
Chimney Sweep
Essex Portfolio, L.P.
91
Santa Barbara, CA
Belmont Terrace
Essex Portfolio, L.P.
71
Belmont, CA
Hope Ranch
Essex Portfolio, L.P.
108
Santa Barbara, CA
CBC Colonial
Essex Portfolio, L.P.
148
Santa Barbara, CA
Tuscana
Essex Tracy Development, Inc.
30
Tracy, CA
Monterra Del Sol
Essex Euclid, LLC
85
Pasadena, CA
Bluffs, The
Essex Bluffs, L.P.
224
San Diego, CA
Woodland Commons
Essex Sunpointe Ltd.
236
Bellevue, WA
Foothill Commons
Essex Sunpointe, Ltd.
360
Bellevue, WA
Chestnut Street
Essex Chestnut Apartments, L.P.
96
Santa Cruz, CA
Mariners Place
Essex Portfolio, L.P.
105
Oxnard, CA
Monterra Del Rey (Glenbrook)
Essex Glenbrook LLC
84
Pasadena, CA
TOTAL:
 
4,500
 

* Properties owned at least 99% by Borrower or a Permitted Affiliates
# Properties subject to a financeable ground lease; provided, however, as to
Marina Cove, only 1 parcel is subject to such a ground lease.

 
A-1-1

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EXHIBIT A-2

UNENCUMBERED WORK IN PROCESS PROPERTIES

AS OF DECEMBER 18, 2009

 
PROPERTY NAME
NAME OF OWNER
LOCATION
Moorpark
Essex Portfolio, L.P.
Moorpark, CA
Park Blvd
Essex Park Boulevard, LLC
Palo Alto, CA
Tasman
Jaysac, Ltd.
Sunnyvale, CA
Berkeley
Essex Berkeley 4th Street, L.P.
Berkeley, CA
View Pointe
Essex View Point, LLC
Newcastle, WA

 
A-2-1

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EXHIBIT B

FORM OF NOTICE OF COMMITTED BORROWING OR
CONVERSION/CONTINUATION

 
Date:

To:
PNC Bank, National Association, as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain Revolving Credit Agreement dated as of
December 18, 2009, among Essex Portfolio L.P., a California limited partnership
(“Borrower”), the financial institutions from time to time party thereto (the
“Lenders”), and PNC Bank, National Association, individually as a Lender and as
administrative agent (in such capacity, “Administrative Agent”) and as Swing
Line Lender and as L/C Issuer (as amended, restated, extended, supplemented or
otherwise modified in writing from time to time, the “Agreement”; the terms
defined therein being used herein as therein defined).

The undersigned hereby requests (select one):

 
[     ]
A Borrowing of Committed Loans

 
[     ]
A Borrowing of Swing Loans

 
[     ]
A Conversion or Continuation of Committed Loans

 
[     ]
Issuance of a Letter of Credit (Letter of Credit Application enclosed)

Borrower’s new Availability under the Agreement $___________.

1.
On ______________________________ (a Business Day).

2.
In the amount of $_______________.

3.
Comprised of [type of credit requested]:

 
[     ]
Swing Loan

 
[     ]
Reference Rate Committed Loan

 
[     ]
LIBOR Committed Loan

 
[     ]
Letter of Credit

4.
If applicable: with an Interest Period of _____ months.

The foregoing request complies with the requirements of [Section 2.3 (for a
Borrowing of Loans and Issuance of Letters of Credit)] [Section 2.7 (for a
conversion/continuation of Loans)] of the Agreement.  The undersigned hereby
certifies that the following statements are true on the date hereof, and will be
true on the above date, before and after giving effect to the application of the
proceeds therefrom:

 
B-1

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(a)           After giving effect to the requested Borrowing or Letter of
Credit, the Outstanding Amount of Loans and Swing Loans plus the Outstanding
Amount of L/C Obligations shall not exceed the Availability, the aggregate
outstanding amount of the Swing Loans shall not exceed the Swing Line
Availability.

(b)           Borrower and Guarantor, and any Subsidiaries or affiliates whose
financial results are consolidated with those of Borrower and Guarantor for
reporting purposes, are in compliance with all of the material covenants and
financial covenants in the Agreement.

(c)           All of the representations and warranties contained in the
Agreement and the other Loan Documents are true and correct as of the date
hereof and shall be true and correct on the date of the Borrowing or the
issuance of the requested Letter of Credit, both before and after giving effect
to such Borrowing or issuance of the requested Letter of Credit; provided,
however, that the representations and warranties set forth in the Agreement
regarding financial statements shall be deemed to be made with respect to the
financial statements most recently delivered to Administrative Agent pursuant to
the Agreement.

(d)           No Default or Event of Default has occurred and is continuing on
the date hereof or after giving effect to the requested extension of credit.

(e)           The proceeds of the Borrowing, or the purpose of the Letter of
Credit, are only as permitted by the Agreement.

(f)           No act, omission, change or event which would have a material
adverse effect on Borrower has occurred since the date of the Agreement.

(g)           Enclosed are the documents and information requested by Lender as
a condition to the requested Borrowing or the issuance of the Letter of
Credit.**

Dated as of _____________, 200__
ESSEX PORTFOLIO, L.P.,
   
a California limited partnership
             
By:
Essex Property Trust, Inc.,
     
a Maryland corporation,
     
its General Partner
               
By:
       
Name:
     
Title
 

** Pursuant to Section 9.4 of the Credit Agreement, the proceeds of a Borrowing
must be sent to the Designated Account.

 
B-2

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EXHIBIT C

FORM OF LETTER OF CREDIT APPLICATION

Application for Irrevocable
PNC Bank, National Association
Standby Letter of Credit
500 First Avenue, Third Floor P7-PFSC-03-T
 
Pittsburgh, PA 15219
 
The undersigned hereby applies for the establishment of an Irrevocable Standby
Letter of Credit as set forth below.  This Application is delivered under, and
such Credit when issued will be subject to, the undersigned’s Reimbursement
Agreement for Standby Letters of Credit, or such other agreement with PNC Bank
National Association for the issuance and reimbursement of letters of credit, as
the case may be.
Letter of Credit to be established as follows:

1.
Date of Application
 
2.
L/C No.  (Bank Use Only)
               
3.
Applicant: (name as it is to appear in letter of credit)
 
4.
Amount:
         
5.
Currency:  __  US Dollars   __  Other (Specify)
                       
6
a.  Expiration Date:
           
b.  Place of expiration: Pittsburgh, PA __  Other _________
 
7.
In Favor of (Beneficiary) (Leave blank if 11E below applies)
               
8.
Transmit Credit by (Check One)
     
Name
               
__
Courier
                   
Address - (Do Not Use a PO Box)
                     
Attention:
   
__
Teletransmission
               
Telephone:
Fax:
 
__
Other (Specify)
 

 
Credit available by sight draft(s) on you or your correspondent, at your option,
and accompanied by the following documents:
9.  __
Beneficiary’s statement purportedly signed by one of its authorized officers
reading as follow:  (Indicate within quotation marks the exact wording to appear
on the statement to be presented.)
 
“
      "
10.  __
Other Documents:
       
11.  __
Other Instructions: (Mark or complete applicable instructions)
   

 
A.  __
The wording of the credit should be similar to the attached specimen/addendum
forming a part hereof.  Please initial all pages.
  B.  __
Clean credit: available by sight draft only; no certification of default or
beneficiary’s entitlement to draw on the letter of credit required.
 
C.  __
Letter of credit to be automatically renewable with at least ___ days notice for
non-renewal by the Bank.
 
D.  __
Partial drawings:
__  Permitted
     
__  Not Permitted (i.e., only one drawing for the full amount is allowed )
     
If partial drawings are not permitted, is the beneficiary permitted to draw for
less than the full amount?
     
__  yes   __  no (if no, then only one drawing for the full amount is permitted)

 

 
E.  __
Letter of Credit is to be issued in favor of foreign bank to support their
guarantee letter of credit to Applicant s customer:
   
1)
Name and address of beneficiary of guarantee/letter of credit issued by foreign
bank:
                   
2)
Name city and country of foreign bank if designated.  If no foreign bank is
designated, PNC Bank will select a correspondent bank.
                 
F.  __
Letter of Credit is to be advised through (name and address of bank, if known):
   
(If beneficiary is located outside the U.S. and no advising bank is designated,
the Credit will be advised through a correspondent bank of PNC Bank.)
           
1.  __
Request advising bank to add their confirmation
   
2.  __
Advising/ confirming bank charges are for account
of   __  Applicant   __  Beneficiary
       
12.
Special Instructions:

 
C-1

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This Credit will be (i) issued by PNC Bank National Association unless otherwise
agreed, and (ii) subject to the current revision of the Uniform Customs and
Practice for Documentary Credits or International Standby Practices 1998 (ISP98)
at PNC Bank’s discretion.

 
13.  Obligor
Name:
     
By:
 
(Signature)
 
Print Name:
   

See reverse side for instructions
         
For assistance, please call Customer Service at (800) 682-4689
Title:
         
Tel:
   
Fax:
 

 
C-2

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Instructions for Application for Irrevocable Standby Letter of Credit

The following are step-by-step instructions for completing this form:

1.
Date of Application - Insert the date on which the Applicant completed the
Application.

2.
L/C No. (Bank Use Only) - Leave blank.  This area will be completed by Letter of
Credit department.

3.
For Account of (Applicant) - Required Field - Complete name and address of the
Applicant of the letter of credit.  The name in this section should be exactly
as the Applicant wants it to appear in the letter of credit.

4.
Amount - Required Field - Insert amount of letter of credit.

5.
Currency - Required Field - Insert currency of letter of credit.

6.
(a) Expiration Date - Required Field - Insert expiration date of letter of
credit.

(b) Place of Expiration - Unless otherwise specified, the letter of credit will
expire at the Bank’s office in Pittsburgh, PA.

7.
In Favor Of (Beneficiary) - Required Field - Complete name and address of
beneficiary as it should appear in the letter of credit.  It is very important
that this section be completed with an attention party of the beneficiary to
ensure that the letter of credit is delivered to the proper party.  Also, please
provide a telephone number for the attention party.

8.
Transmit By - Complete with any special delivery instructions.  Unless otherwise
specified, the letter of credit will be delivered by overnight courier for
domestic transactions.  For foreign transactions, the letter of credit will be
issued via SWIFT/TELEX.

9.
Beneficiary’s Certification - Unless you have attached a specimen format for the
letter of credit, this section should set forth the statement that the
beneficiary must certify to the Bank in order to make a drawing.  This section
is necessary for the Letter of Credit Department to correctly draft the letter
of credit.

10.
Other Documents - This is an optional field for other documents, statements or
certifications which the beneficiary must present to draw against the letter of
credit.

A.   Other Instructions -
 
(a)
If applicable, place an “X”‘ in this box and attach to the Application a copy of
the requested format with all pages initialed.

 
(b)
Place an “X” in this box if the letter of credit is to be issued without a
beneficiary’s certification.  In this event, the letter of credit will be
payable to the beneficiary on demand or by presentation of a sight draft
only.  No other documentation would be required for the beneficiary to obtain
payment.

 
(c)
Place an “X” in this box if the letter of credit is to be automatically
renewable.  This means that unless a notice is sent by the Bank to the
beneficiary that the letter of credit will not be further extended, it will
automatically be renewed for the next year (or other applicable period).  It is
the obligation of the Applicant to notify the Bank that the letter of credit is
no longer required and a non-renewal notice should be sent

 
(d)
Place an “X” in the appropriate box with regard to partial drawings by the
beneficiary.  If partial drawings are not permitted, place an “X” in the
appropriate box as to whether the beneficiary is permitted to draw for less than
the full amount.  If “no” is designated, then only one drawing for the full
amount will be permitted.

 
(e)
If the Applicant needs to provide a foreign entity with a guarantee or a standby
letter of credit issued by a foreign bank, PNC Bank will issue a letter of
credit in favor of the foreign bank to support the guarantee or letter of credit
to be issued by the foreign bank.  If the foreign bank has been designated, it
should be entered in this section, otherwise a PNC Bank correspondent will be
used.

 
(f)
This field should be completed if the letter of credit is to be
advised/confirmed through the beneficiary’s bank.  If the beneficiary is located
outside the United States and no advising bank is designated, a PNC Bank
correspondent bank will be used.

 
(i)
Place an “ X” in this box if the beneficiary has instructed that the advising
bank must also confirm the letter of credit.

 
(ii)
Place an “X” in the appropriate box as to who will pay the fees and charges of
the advising/confirming bank the amount of which are determined by the
advising/confirming bank.  If this field is left blank, fees will be charged to
the Applicant’s account.

Note: Under the Uniform Customs and Practice for Documentary Credits, the
Applicant may be required to pay the advising/confirming bank charges if the
beneficiary refuses to do so, even if the letter of credit provides that such
charges are for the beneficiary’s account.

11.
Special Instructions - Complete with any special instructions, i.e., mailing
instructions, fax information, special handling, special instructions to be
included in the letter of credit.

12.
Type/print complete name of Obligor and name and title of person who signed the
Application.  If a parent company is applying for a letter of credit on behalf
of its subsidiary, the name of the parent company and signature of an authorized
officer of the parent company should appear in this section.  The name of the
Applicant as it should appear in the letter of credit should be stated in
Section 3.

 
C-3

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EXHIBIT D

COMPLIANCE CERTIFICATE

_______, 20___

PNC Bank, National Association
PNC Firstside Center, 4th Floor
500 First Avenue
Pittsburgh, PA 15219
Attention:_______________

Re:  Credit Agreement dated as of December 18, 2009 as amended and modified from
time to time (the “Agreement”), among Essex Portfolio L.P., a California limited
partnership (“Borrower”), the several financial institutions from time to time
party thereto (each a “Lender” and collectively, the “Lenders”), and PNC Bank,
National Association, individually as a Lender and as administrative agent for
the Lenders (in such capacity, “Administrative Agent”), and as Swing Line Lender
and L/C Issuer

To the Agent:

Reference is made to the above-mentioned Agreement.  Capitalized terms used
herein and not defined herein shall have the meanings ascribed to such terms in
the Agreement.

The undersigned Responsible Officer hereby certifies as of the date hereof that
he is the Principal Financial Officer of the General Partner of Borrower, and
that, as such, he is authorized to execute and deliver this Certificate to
Administrative Agent on the behalf of Borrower, and that:

1.           The undersigned has reviewed and is familiar with the terms of the
Agreement and has made, or has caused to be made under his supervision, a
detailed review of the transactions and condition (financial or otherwise) of
Borrower during the accounting period covered by the attached financial
statements.

2.           A review of the activities of Borrower during such fiscal period
has been made under the supervision of the undersigned with a view to
determining whether during such fiscal period Borrower performed and observed
all its Obligations under the Loan Documents, and

3.           The representations and warranties of Borrower contained in Article
7 of the Agreement, and any  representations and warranties of Borrower,
Guarantor and each Permitted Affiliate that are contained in any document
furnished at any time under or in connection with the Loan Documents, are true
and correct on and as of the date hereof, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct as of such earlier date, and except that for
purposes of this Compliance Certificate, the representations and warranties
contained in Section 7.6 of the Agreement shall be deemed to refer to the most
recent statements furnished pursuant to clauses (a) and (b), respectively, of
Section 6.3 of the Agreement, including the statements in connection with which
this Compliance Certificate is delivered.

 
D-1

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

 

4.           As of the date of this Certificate the aggregate Outstanding Amount
of Loans and Swing Loans plus the Outstanding Amount of L/C Obligations is less
than or equal to the Availability.

5.           The financial covenant analyses and information set forth on the
Annexes and Schedules attached hereto are true and accurate on and as of the
date of this Certificate.

[Signature Page Follows]

 
D-2

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IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
___________.

 
ESSEX PORTFOLIO, L.P.,
 
a California limited partnership
             
By:
ESSEX PROPERTY TRUST, INC.,
     
a Maryland corporation
                         
By:
       
Name: Michael T. Dance
     
Title: Executive VP, Chief Financial Officer

 
D-3

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Annex A
FINANCIAL COVENANT COMPLIANCE SUMMARY
_______, 20___
(Dollars in Thousands)
 
[reserved]
                 
Maximum Total Liabilities to Gross Asset Value
       
(Section 6.9)
       
See Annex A-2
 
Not to exceed
 
0.60 :1.00
   
Actual
       
Margin (increase to total liabilities)
                                 
Fixed Charge Coverage Ratio (Section 6.11)
       
See Annex A-3
 
Not less than
 
1:50 :1.00
   
Actual
       
Margin (change to fixed charges)
                       
Unsecured Debt to Unencumbered Property Value
       
(Section 6.10(a))
       
See Annex A-4
 
Not to exceed
 
0.60 :1.00
   
Actual
       
Margin
                       
Secured Recourse Debt to Gross Asset
       
Value (Section 6.10(c))
       
See Annex A-5
 
Not to exceed
 
0.10 :1.00
   
Actual
       
Margin
                       
(a) Unencumbered Development Property to
       
Unencumbered Asset Pool Value (Section 4.1(b))*
       
See Annex A-6
 
Not to exceed
 
0.25 :1.00
   
Actual
       
Margin
   
*Not to exceed 0.20:1.00 at such time that Essex Property Trust, Inc. has less
than a BBB- or Baa3 (as applicable) rating from S&P or Moody’s
                 
(b) Maximum Quarterly Dividends (Section 6.13)
       

See Annex A-7
Not to exceed 95% of Funds From Operations
             
Actual (Line 7(b))
   

 
D-4

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(Under)/Over
                 
(c)
Development – percentage of Gross Asset Value (Section 6.6)
 
Total actual
   
See Annex A-8
 
Not to exceed 35%
           
(Under)/Over
                                               
(i)
Entitled and Unentitled Land 6.6(a)
 
Not to exceed 35%
(Under)/Over
     
(ii)
Total development properties 6.6(b)
 
Not to exceed 35%
(Under)/Over
     
(iii)
Joint Venture Investments 6.6(c)
         
(iv)
Capital Interests in Acquisition down-REITs 6.6(d)
         
(v)
Real estate assets (other than multifamily residential properties), or
investments in, or loans to, companies that own and/or develop real estate
(other than multifamily residential properties) 6.6(e)
                     
(9)
Debt Service Coverage Ratio (Section 6.12)
                       
(a)
Net Operating Income for the Unencumbered
       
Asset Pool for the most recent consecutive calendar quarter
                       
(b)
Debt Service on Unsecured Debt for the most recent
       
consecutive calendar quarter
                       
(c)
Ratio of (a). to (b).
                         
Minimum Required: 1.75: 1.00
                                                               

 
D-5

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Annexes to Compliance Certificate

________, 20____

(Dollars in Thousands)

Annex A-1
                           
(a)
[reserved]
                 
Annex A-2
             
(b)
Maximum Total Liabilities to Gross Asset Value (Section 6.9)
     
Not to exceed 60%
     
Actual (Line 2(a)(vii) to Line 2(b)(viii))
       
Margin (increase to total liabilities)
                   
(i)
Maximum Total Liabilities
       
(1)
Total Liabilities of Guarantor and Subsidiaries
       
(2)
Add: L/C Obligations (Sch. 2)
       
(3)
Add: Guarantees
       
(4)
Add: Guarantor and Subsidiaries pro rata share of total liabilities in joint
ventures (Sch. 7)
       
(5)
Add: Liabilities of unconsolidated Affiliates recourse to Guarantor or Borrower
(Sch. 1)
       
(6)
Less: Minority interest liabilities of Borrower (Sch. 4)
       
(7)
Less: Down Reits liabilities (Sch. 8)
       
(8)
Total Liabilities (sum of (i) to (vii))
                 
(ii)
Gross Asset Value:
     
EBITDA Calculation:
         
a.
Consolidated net income before minority interest
         
b.
Less: extraordinary gains
         
c.
Add: discontinued operations depreciation and interest expense
         
d.
Add: consolidated interest expense
         
e.
Add: consolidated provision for federal and state income taxes
         
f.
Add: consolidated corporate depreciation expense
         
g.
Add: consolidated depreciation expense
         
h.
Add: consolidated amortization expense
         
i.
Add: other non cash charges and expenses
         
j.
Add: extraordinary losses
         
k.
Add: prepayment penalties and write off of deferred charges
         
l.
Less: minority interest of such EBITDA (Sch. 4)
         
m.
Add: JV EBITDA (Sch. 7)
         
n.
Less: GAAP Book (income)/loss (Sch. 7)
                                   
(1)
EBITDA (sum of (A) through (N))
       
Deductions from EBITDA making up Gross Asset value
   

 
D-6

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

 
 

     
a.
Income attributable to properties bought during the fiscal quarter (Sch. 3)
         
b.
Income attributable to Clarewood Office and Palo Alto Office
         
c.
Income attributable to properties sold during the fiscal quarter
         
d.
Gain on sale of marketable securities
       
(2)
Deductions from EBITDA (sum of (A) through (C))
                     
(3)
Quarterly EBITDA
         
a.
3Q ___
         
b.
2Q ___
         
c.
1Q ___
         
d.
4Q ___
       
(4)
Annualized EBITDA
       
(5)
Capitalization rate
       
(6)
Preliminary Gross Asset Value (Line 2(b)(iv) / Line 2(b)(v))
                     
Addition to Preliminary Gross Asset Value
         
a.
Add: cash and marketable securities
         
b.
Add: Acquisition cost of consolidated asserts acquired during the previous four
quarters (Sch. 3)
         
c.
Add: Prorata share of acquisition price of assets held in joint ventures during
the previous four quarters (Sch. 3)
         
d.
Add: Consolidated development properties (Sch. 6)
         
e.
Add: pro rata share of cost of development properties held in joint ventures
(Sch. 6)
         
f.
Add: $4,500,000 if Borrower owns Clarewood office building
         
g.
Add: $9,000,000 if Borrower owns 925 and 935 East Meadow Dr office building
       
(7)
Sum of Additions to Preliminary Gross Asset Value (sum of (A) through (G))
                     
(8)
Gross Asset Value (Line 2(b)(vi) + Line 2(b)(vii))
   

 
D-7

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Annex A-3
(c)
Fixed Charge Coverage Ratio (Section 6.11)
       
Not less than
 
1.50
   
Actual (ratio of Line 3(a) to 3(b))
       
Margin (change to fixed charges)
       
Margin (change to EBITDA)
                 
(i)
Annualized EBITDA (line 2(b)(iv)) plus Gain on sale of marketable securities
(Line 2b(i)D.)
     
Fixed Charges Calculation:
       
(1)
Consolidated interest expense
       
(2)
Capitalized interest expense (includes 28.2% of Fund II Cap. Int.)
       
(3)
Preferred stock dividends (preferred perpetual plus series F & G)
       
(4)
Schedule of principal payments, other than balloon payments (Sch. 1)
       
(5)
Capital Reserve ($62.50/ unit/qtr)
       
(6)
Pro rata share of lines (i) through (iv) in joint ventures (Sch. 7)
     
(ii)
Quarterly fixed charges (sum of (i) through (vi))
       
(1)
3Q ___
       
(2)
2Q ___
       
(3)
1Q ___
       
(4)
4Q ___
   

 
D-8

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Annex A-4
(d)
Unsecured Debt to Unencumbered Asset Pool Value (Section 6.10)(a))
   
Not to exceed 60%
   
Actual (ratio of Line 4(a) plus Line 4(b) to Line 4(c))
   
Margin
       
(i)
Unsecured Debt (Sch. 2)
 
(ii)
Guarantees
 
(iii)
Unencumbered Asset Pool Value (Sch. 2)

 
D-9

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Annex A-5
(e)
Secured Recourse Debt to Gross Asset Value (Section 6.10(c))
     
Not to exceed
10%
   
Actual (Ratio of Line 5(a) to Line 5(b))
     
Margin
           
(i)
Secured Recourse Debt (Sch. 10)
   
(ii)
Gross Asset Value (Annex A-2)
 

 
D-10

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Annex A-6
(f)
Unencumbered Development Property to Unencumbered Asset Pool Value (Section
4.1(a)(ii)(5)
     
Not to exceed
25%*
   
Actual (ratio of Line 6(a) to Line 6(b))
     
Margin
             
*Not to exceed 20% at such time that Essex Property Trust, Inc. has less than a
BBB- or Baa3 (as applicable) rating from S&P or Moody’s
           
(i)
Unencumbered Development Property Value (Sch. 2)
   
(ii)
Unencumbered Asset Pool Value (Sch. 2)
 

 
D-11

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Annex A-7
(g)
Maximum Quarterly Dividends (Section 6.13)
       
Not to exceed 95% of Funds From Operations (95% of Line 7(a))
       
Actual (Line 7(b))
       
(Under)/Over
               
Actual FFO (trailing 4 qtrs-specify dates)
       
3Q___
       
4Q___
       
1Q___
       
2Q___
               
(i)
Total Funds from Operations for 4 qtrs
                 
3Q__
       
4Q__
       
1Q__
       
2Q__
               
(ii)
Total Distributions for 4 qtrs
   

 
D-12

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Annex A-8
(h)
Development; Type of Business (% of adjusted GAV) (Section 6.6)
             
Total actual
     
Not to exceed 35%
     
(Under)/Over
           
(i)
Entitled and Unentitled Land (Sch.__)  -- Not to exceed 10% of Gross Asset Value
                   
(ii)
Total actual Development (Sch. 6)  -- Not to exceed 25% of Gross Asset Value
           
(iii)
Joint Venture Investments (Sch. 9) --
     
[Not to exceed 20% of Gross Asset Value (20% of line 2(b)(viii))]
           
(iv)
Acquisition down REITs Capital Interests (Sch. 8)
           
(v)
Real Estate Assets (other than multi-family residential properties) or
Investments in Real Estate Companies (Sch. 11)
         

 
D-13

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Essex Portfolio L.P. – Schedule I
Schedule of Debt Maturities
_____, 20___

Loan
Security
Pay Rate
Maturity
Current Loan Amount
Prin Amort 2Q__
Prin Amort 20__
Prin Amort 20__
Prin Amort 20__
Prin Amort 20__
Prin Amort Thereafter
Total
                                               

 
D-14

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Essex Portfolio L.P. – Schedule 2
Unencumbered Asset Pool
______, 20__

 
Units
 
Reserves 250
Adjust NOI
CAP
Current Value
60% of Cap Value
Line Availability
Property not included if % >30%
 
Current Vacancy
Q3__
Q4__
Q1__
Q2__
Total or Annualized
                                                       

 
D-15

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Essex Portfolio L.P. – Schedule 3
Property Acquisitions
_______, 20___

         
Pro-Rata
         
Lender
   
Classification
Size
Units/Acres
Location
Percent
Ownership
JV
Partner
Cost
 
Quarter NOI
 
Trailing 12 Month NOI
Cap Rate
Occupancy
Closing Date
Financing Source
$
Debt
Recourse
                               
2Q__ Unentitled Land
                                                                               
                                                       
0
 
0
 
0
                                           
2Q__ Undeveloped Land
                                                                               
                                                       
0
 
0
 
0
                                           
2Q__ Single Assets
                                                                               
                                                       
0
 
0
 
0
                                           
2Q__ Fund II
                                                                               
                                                       
0
 
0
 
0
                                                                               
                       
Total Acquisitions (current quarter only)
0
 
0
 
0
 
0
           

 
D-16

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Essex Portfolio L.P. – Schedule 4
Joint Venture-Minority Interest (unconsolidated)
________, 20___

           
NOI
%NOI
           
Property
Units
Location
Percent
Ownership
JV
Partner
Cost
3Q__
4Q___
1Q___
2Q__
3Q__
4Q__
1Q__
2Q__
Occupancy
Closing
Date
Financing
Source
Property
Liabilities
Pro-Rata Liabilities
Recourse
                                                                               
                                                                               
                                                                               
                                                                               
                                       

 
D-17

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Essex Portfolio L.P. – Schedule 5
Property Dispositions
_____, 20___

 
Property
Units
Location
Percent Ownership
Quarter NOI
 
Sale
Price
 
Net
Proceeds
Cap
Rate
Closing
Date
                                               
Quarter Dispositions
                                                                     
TTM Dispositions (current quarter only)
                                                                   

 
D-18

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Essex Portfolio L.P. – Schedule 6
Development Pipeline
_______, 20___

Classification
Amount
 
Units
 
Retail
Sq. Ft.
Location
Percent
Ownership
JV Partner
Total Projected Cost
 
Essex Max. Liability
 
Essex
Max.
Commitment
Percentage Complete
Estimated Completion
Financing
Source
Loan
Commitment
Essex
Recourse
                                     
Undeveloped Land-Equity Fund
                                                                               
                                                                               
                                                                 
Unidentified Land
                                                                               
                                                                               
                                                                               
                       
Single Assets
                                                                               
                                                                               
                                                                               
                       
Joint Venture Development
                                                                               
                                                                     
For-Sale Projects (TRS)
                                                                         
Joint Venture Pre Development
                                                                               
                               
Total Development
                                                                         
Consolidated (less Fund)
                                   
Prorata Consolidated JV Assets to decrease
                                   

 
D-19

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Classification
Amount
Units
Retail
Sq. Ft.
Location
Percent
Ownership
JV Partner
Total Projected Cost
Essex Max. Liability
Essex
Max.
Commitment
Percentage Complete
Estimated Completion
Financing
Source
Loan
Commitment
Essex
Recourse
Total Development Properties
                                                         
Prorata Fund Assets to Include
                           

 
D-20

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Essex Portfolio L.P. – Schedule 7
Joint Ventures
_________, 20__

Property Name
# of units
Capital
Interest
Weighted #
of units
Total
Property
Liabilities (1)
Essex pro
rata Liabilities
P&L
Ownership Interest
Net
Operating
Income
Total
Fixed
Charges
Preferred
Return
L.P.’s
Actual Share
of EBITDA
Prorata
Fixed
Charges
GAAP Book
Income QTR
Ended ______
Fund I
                                                 
Fund II
                                                                               
                     

 
Notes:
(1) Excludes Mark-to-market adjustment for Fun II debt.

 
D-21

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Essex Portfolio L.P. – Schedule 8
Down Reits
_______, 20___

Property Name
Units
 
Capital
Interests
 
Total
Property
Indebtedness
 
JV Percent
Ownership
 
Prorata
JV
                                                                               
                                       

 
D-22

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Essex Portfolio L.P. – Schedule 9
Joint Venture Investments
_______, 20___

Joint Ventures
Book Value
   
Essex Apartment Value Fund II, L.P. (Fund II)
         
Capitalized Costs
         
Other
             

 
D-23

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Essex Portfolio L.P. – Schedule 10
Secured Recourse Debt
_______, 20__

 
Subtotal
0
 
Secured Recourse Debt
0
     
% of Secured Recourse Debt to Gross Asset Value (Sec. 6.10(c))
         
May not exceed 10% of Gross Asset Value
 

 
D-24

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Essex Portfolio L.P. – Schedule 11
Real Estate Assets
_______, 20___

Real Estate Assets (other than multifamily properties) or investments in
companies that own or develop real estate (other than multifamily properties)
     
Other real estate assets:
             
Subtotal
     
Loans to other real estate companies:
         
Subtotal
     
Total
 

 
D-25

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EXHIBIT E

FORM OF ASSIGNMENT AND ASSUMPTION

THIS ASSIGNMENT AND ASSUMPTION (the “Assignment and Assumption”) is dated as of
the Effective Date set forth below and is entered into by and between [Insert
name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the
“Assignee”), Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended, the
“Credit Agreement”), receipt of a copy of which is hereby acknowledged by the
Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached
hereto are hereby agreed to and incorporated herein by reference and made a part
of this Assignment and Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below, (i) all of the Assignor’s rights and
obligations in its capacity as a Lender under the Credit Agreement and any other
documents or instruments delivered pursuant thereto to the extent related to the
amount and percentage interest identified below of all of such outstanding
rights and obligations of the Assignor under the respective facilities
identified below (including, without limitation, Swing Loans, Letters of Credit,
the Guaranty and each Payment Guaranty included in such facilities) and (ii) to
the extent permitted to be assigned under applicable law, all claims, suits,
causes of action and any other right of the Assignor (in its capacity as a
Lender) against any Person, whether known or unknown, arising under or in
connection with the Credit Agreement, any other documents or instruments
delivered pursuant thereto or the loan transactions governed thereby or in any
way based on or related to any of the foregoing, including, but not limited to,
contract claims, tort claims, malpractice claims, statutory claims and all other
claims at law or in equity related to the rights and obligations sold and
assigned pursuant to clause (i) above (the rights and obligations sold and
assigned pursuant to clauses (i) and (ii) above being referred to herein
collectively as, the “Assigned Interest”).  Such sale and assignment is without
recourse to the Assignor and, except as expressly provided in this Assignment
and Assumption, without representation or warranty by the Assignor.

 
1.
Assignor:
_____________________

 
2.
Assignee:
_____________________

[and is an Affiliate/Approved Fund of [identify Lender] ]

 
3.
Borrowers):
_____________________

 
4.
Administrative Agent:  PNC Bank, National Association, as the administrative
agent under the Credit Agreement

 
5.
Credit Agreement:  Revolving Credit Agreement, dated as of December 18, 2009,
among Essex Portfolio, L.P., the several financial institutions from time to
time party thereto (each a “Lender” and collectively, the “Lenders”), and PNC
Bank, National Association, individually as a Lender and as administrative agent
for the Lenders (in such capacity, the “Administrative Agent”) and as Swing Line
Lender and as L/C Issuer.

 
E-1

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

 

 
6.
Assigned Interest:
_____________________

Facility Assigned
Aggregate Amount of Commitment/Loans for all Lender1
Amount of Commitment/Loans Assigned1
Percentage Assigned of Commitment/Loans2
CUSIP Number
 
$
$
___________%
   
$
$
___________%
   
$
$
___________%
 

 
[7.
Trade Date:__________]3

Effective Date: ______________, 20__ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND
WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]

The terms set forth in this Assignment and Assumption are hereby agreed to:

 
ASSIGNOR
           
[NAME OF ASSIGNOR]
                   
By
     
Title:
                     
ASSIGNEE
           
[NAME OF ASSIGNEE]
                   
By
     
Title:
   

________________________________
 
1
Amount to be adjusted by the counterparties to take into account any payments or
prepayments made between the Trade Date and the Effective Date.

2
Set forth, to at least 9 decimals, as a percentage of the Commitment Loans of
all Lenders thereunder.

3
To be completed if the Assignor and the Assignee intend that the minimum
assignment amount is to be determined as of the Trade Date

 
 
E-2

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

 
 

 
Consented to and Accepted:
           
PNC BANK, NATIONAL ASSOCIATION,
   
as Administrative Agent
                   
By:
     
Name:
     
Title:
                     
PNC BANK, NATIONAL ASSOCIATION,
   
as L/C Issuer and Swing Line Lender
                   
By:
     
Name:
     
Title:
                     
[Consented to:]4
           
ESSEX PORTFOLIO, L.P.,
   
a California limited partnership
           
By:
ESSEX PROPERTY TRUST, INC.,
     
a Maryland corporation
     
its General Partner
                   
By:
     
Name:
     
Title:
   

________________________________
 
4
To be added only if the consent of Borrower is required by the terms of the
Credit Agreement.

 
E-3

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ANNEX I TO ASSIGNMENT AND ASSUMPTION

ESSEX PORTFOLIO, L.P.
REVOLVING CREDIT AGREEMENT
DATED AS OF DECEMBER 18, 2009

STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION

1.              Representations and Warranties.

1.1           Assignor.  The Assignor (a) represents and warrants that (i) it is
the legal and beneficial owner of the Assigned Interest, (ii) the Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim, and
(iii) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby; and (b) assumes no responsibility with respect
to (i) any statements, warranties or representations made in or in connection
with the Credit Agreement or any other Loan Document, (ii) the execution,
legality, validity, enforceability, genuineness, sufficiency or value of the
Loan Documents or any collateral thereunder, (iii) the financial condition of
Borrower, any of its subsidiaries or affiliates or any other Person obligated in
respect of any Loan Document or (iv) the performance or observance by Borrower,
any of its subsidiaries or affiliates or any other Person of any of their
respective obligations under any Loan Document.

1.2.           Assignee.  The Assignee (a) represents and warrants that (i) it
has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) it
meets all requirements of an Eligible Assignee under the Credit Agreement
(subject to receipt of such consents as may be required under the Credit
Agreement), (iii) from and after the Effective Date, it shall be bound by the
provisions of the Credit Agreement as a Lender thereunder and, to the extent of
the Assigned Interest, shall have the obligations of a Lender thereunder, (iv)
it has received a copy of the Credit Agreement, together with copies of the most
recent financial statements delivered pursuant to Section 6.3 thereof, as
applicable, and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase the Assigned Interest on the basis of
which it has made such analysis and decision independently and without reliance
on the Administrative Agent or any other Lender, and (v) if it is a foreign
Lender, attached to the Assignment and Assumption is any documentation required
to be delivered by it pursuant to the terms of the Credit Agreement, duly
completed and executed by the Assignee; and (b) agrees that (i) it will,
independently and without reliance on the Administrative Agent, the Assignor or
any other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents, and (ii) it will perform in
accordance with their terms all of the obligations which by the terms of the
Loan Documents are required to be performed by it as a Lender.

 
EA-1

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2..             Payments.  From and after the Effective Date, the Administrative
Agent shall make all payments in respect of the Assigned Interest (including
payments of principal, interest, fees and other amounts) to the Assignor for
amounts which have accrued to, but excluding, the Effective Date and to the
Assignee for amounts which have accrued from and after the Effective Date.

3.              General Provisions.  This Assignment and Assumption shall be
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns.  This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument.  Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by telecopy shall be effective as delivery of a
manually executed counterpart of this Assignment and Assumption.  THIS
ASSIGNMENT AND ASSUMPTION AGREEMENT IS TO BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF CALIFORNIA (AS PERMITTED BY
SECTION 1646.5 OF THE CALIFORNIA CIVIL CODE OR ANY SIMILAR SUCCESSOR PROVISION),
WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW RULE THAT WOULD CAUSE THE APPLICATION
OF THE LAWS OF ANY JURISDICTION OTHER THAN THE INTERNAL LAWS OF THE STATE OF
CALIFORNIA TO THE RIGHTS AND DUTIES OF THE PARTIES.

 
EA-2

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EXHIBIT F-l

FORM OF PAYMENT GUARANTY (GUARANTOR)

[See Attached]

 
F-1

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

 

PAYMENT GUARANTY
(Guarantor - Revolving Loans and Letters of Credit)

THIS PAYMENT GUARANTY (this “Guaranty”) is dated as of December 18, 2009, and is
made by ESSEX PROPERTY TRUST, INC., a Maryland corporation (“Guarantor”), in
favor of PNC BANK, NATIONAL ASSOCIATION, as administrative agent (in such
capacity, “Administrative Agent”) for the lenders (each, a “Lender” and
collectively, “Lenders”) from time to time party to the Agreement (as
hereinafter defined) and as Swing Line Lender and L/C Issuer.  The
Administrative Agent, the Lenders, the Swing Line Lender and the L/C Issuer are
sometimes hereinafter referred to collectively as the “Guaranteed Parties” and
each, individually, as a “Guaranteed Party”.

Factual Background

A.            Essex Portfolio, L.P., a California limited partnership
(“Borrower”), Administrative Agent and the lenders party thereto entered into a
Revolving Credit Agreement dated as of December 18, 2009 (as amended from time
to time, the “Agreement”), pursuant to which such lenders agreed to make
available to Borrower an unsecured revolving line of credit and letter of credit
facility (the “Credit Line”) on the terms and subject to the conditions set
forth therein.

B.             Guarantor is executing this Guaranty to induce Lenders to extend
the Credit Line and enter into the Agreement.

C.             This Guaranty is one of several Loan Documents, as defined and
designated in the Agreement.  The Loan Documents also include the Agreement and
certain other specified instruments and agreements.  Capitalized terms used in
this Guaranty shall have the meanings set forth in Section 33 or in the text of
this Guaranty and, if not defined in Section 33 or otherwise herein, shall have
the meanings given to them in the Agreement.

Guaranty

Section 1.               Guaranty of Credit Line.  Guarantor hereby
unconditionally and irrevocably guaranties to the Guaranteed Parties, and their
respective successors, transferees and assigns, the full and prompt payment of
the Credit Line when due (whether at stated maturity, by required prepayment,
declaration, acceleration, demand or otherwise) and performance of the
indebtedness, liabilities and other obligations of Borrower to the Guaranteed
Parties under or in connection with the Agreement, the Notes and the other Loan
Documents, and unconditionally and irrevocably agrees to pay to Administrative
Agent, for its own account and for the account of the other Guaranteed Parties,
upon the occurrence of an Event of Default under and as defined in the
Agreement, the full amount of the Credit Line.  This is a guaranty of payment,
not of collection.  If Borrower defaults in the payment when due of all or any
part of the Credit Line, Guarantor shall in lawful money of the United States
pay to Administrative Agent or order, on demand, all sums due and owing on the
Credit Line, including all interest, charges, fees and other sums, costs and
expenses.

Section 2.              Credit Line.  In this Guaranty, the term “Credit Line”
is broadly defined to mean and include all primary, secondary, direct, indirect,
fixed and contingent obligations of Borrower to pay principal, interest,
prepayment charges, late charges, loan fees and any other fees, charges, sums,
costs and expenses which may be owing at any time under the Loan Documents, as
any or all of them may from time to time be modified, amended, extended or
renewed, including all unpaid principal of the Loans, all amounts owing in
respect of the L/C Obligations, all interest accrued thereon, all
indemnification obligations of Borrower under or in connection with the
Agreement, the Notes and the other Loan Documents, and all other amounts payable
by Borrower to the Guaranteed Parties thereunder or in connection therewith,
including all such amounts that may be or hereafter become unenforceable or be
or hereafter become an allowed or disallowed claim under any Insolvency
Proceeding, and including interest that accrues after the commencement by or
against Borrower or any Affiliate thereof under any Insolvency Proceeding naming
such Person as the debtor in such proceeding.  For purposes of this Guaranty,
the Credit Line includes all such obligations which may arise in connection with
any transactions between Borrower and Lenders which may afford interest rate
protection to all or part of the Credit Line, if any, and all other
indebtedness, liabilities and obligations to be paid or performed by Guarantor
in connection with this Guaranty (including any and all amounts due under
Section 22).

 
F-1-1

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Section 3.              Rights of Administrative Agent and the other Guaranteed
Parties.  Guarantor authorizes Administrative Agent and/or the other Guaranteed
Parties to perform any or all of the following acts at any time in its sole
discretion, all without notice to Guarantor and without affecting Guarantor’s
obligations under this Guaranty:

(a)            alter any terms of the Credit Line or any part of it, including
renewing, compromising, extending or accelerating, or otherwise changing the
time for payment of, or increasing or decreasing the rate of interest on, the
Credit Line or any part of it;

(b)            take and hold security for the Credit Line or this Guaranty,
accept additional or substituted security for either, and subordinate, exchange,
enforce, waive, release, compromise, fail to perfect and sell or otherwise
dispose of any such security;

(c)            direct the order and manner of any sale of all or any part of any
security now or later to be held for the Credit Line or this Guaranty, and
Administrative Agent or any other Guaranteed Party may also bid at any such
sale;

(d)            apply any payments or recoveries from Borrower, Guarantor or any
other source, and any proceeds of any security, to Borrower’s obligations under
the Loan Documents in such manner, order and priority as Administrative Agent
may elect whether or not those obligations are guarantied by this Guaranty or
secured at the time of the application;

(e)            release Borrower of its liability for the Credit Line or any part
of it;

(f)             substitute, add or release any one or more guarantors or
endorsers; or

(g)            in addition to the Credit Line, extend other credit to Borrower,
and may take and hold security for the credit so extended, all without affecting
Guarantor’s liability under this Guaranty.

 
F-1-2

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

 

Section 4.               Guaranty to be Absolute.  Guarantor expressly agrees
that until the Credit Line is paid and performed in full and each and every
term, covenant and condition of this Guaranty is fully performed, Guarantor
shall not be released by or because of:

(a)            any act or event that might otherwise discharge, reduce, limit or
modify Guarantor’s obligations under this Guaranty;

(b)            any waiver, extension, modification, forbearance, delay or other
act or omission of Administrative Agent or any other Guaranteed Party, or its
failure to proceed promptly or otherwise as against Borrower, Guarantor or any
security;

(c)            any action, omission or circumstance which might increase the
likelihood that Guarantor may be called upon to perform under this Guaranty or
which might affect the rights or remedies of Guarantor as against Borrower or
any other Person;

(d)            any dealings occurring at any time between Borrower,
Administrative Agent or any other Guaranteed Party, whether relating to the
Credit Line or otherwise; or

(e)            any action of Administrative Agent or any other Guaranteed Party
described in Section 3.

Guarantor hereby acknowledges that absent this Section 4, Guarantor might have a
defense to the enforcement of this Guaranty as a result of one or more of the
foregoing acts, omissions, agreements, waivers or matters.  Guarantor hereby
expressly waives and surrenders any defense to any liability under this Guaranty
based upon any of such acts, omissions, agreements, waivers or matters.

Section 5.              Liability of Guarantor.  Guarantor’s obligations under
this Guaranty are and shall be independent, absolute, unconditional and
irrevocable, and shall not be affected by any circumstance which might
constitute a discharge of a surety or guarantor, other than the indefeasible
payment and performance in full of the Credit Line.  Guarantor’s liability with
respect to the Credit Line shall remain in full force and effect without regard
to, and shall not be impaired or affected by, any Insolvency Proceeding with
respect to Borrower, Guarantor or any other Person, or any assignment or other
transfer of any Guaranteed Party’s interests in and rights under this Guaranty
or the other Loan Documents, or any claim, defense, counterclaim or setoff
(other than that of prior performance), that Borrower, Guarantor or any other
Person may have or assert; or any amendment, modification, renewal, extension,
cancellation or surrender of any Loan Document or any collateral that may at any
time secure the Credit Line, or any Guaranteed Party’s exchange, release, or
waiver of any other guaranty of all or any part of the Credit Line or any other
indebtedness, obligations or liabilities of Borrower or any other guarantor to
any Guaranteed Party under the Credit Line.

Section 6.               Guarantor’s Waivers.  Guarantor waives:

(a)            all statutes of limitations as a defense to any action or
proceeding brought against Guarantor by Administrative Agent, to the fullest
extent permitted by law;

 
F-1-3

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

 

(b)            any right it may have to require Administrative Agent or any
other Guaranteed Party to proceed against Borrower, proceed against or exhaust
any security held from Borrower, or pursue any other remedy in Administrative
Agent’s or any other Guaranteed Party’s power to pursue;

(c)            any defense based on any claim that Guarantor’s obligations
exceed or are more burdensome than those of Borrower;

(d)            any defense based on: (i) any legal disability of Borrower, (ii)
any release, discharge, modification, impairment or limitation of the liability
of Borrower to Administrative Agent or any other Guaranteed Party from any
cause, whether consented to by Administrative Agent or any other Guaranteed
Party or arising by operation of law or from any Insolvency Proceeding, and
(iii) any rejection or disaffirmance of the Credit Line, or any part of it, or
any security held for it, in any such Insolvency Proceeding;

(e)            any defense based on any action taken or omitted by
Administrative Agent or any other Guaranteed Party in any Insolvency Proceeding
involving Borrower, including any election to have Administrative Agent’s or any
other Guaranteed Party’s claim allowed as being secured, partially secured or
unsecured, any extension of credit by Lenders to Borrower in any Insolvency
Proceeding, and the taking and holding by Administrative Agent or the other
Guaranteed Parties of any security for any such extension of credit;

(f)            all presentments, demands for performance, notices of
nonperformance, protests, notices of protest, notices of dishonor, notices of
acceptance of this Guaranty and of the existence, creation, or incurring of new
or additional indebtedness, and demands and notices of every kind except for any
demand or notice by Administrative Agent to Guarantor expressly provided for in
Section 1;

(g)            any defense based on or arising out of any defense that Borrower
may have to the payment or performance of the Credit Line or any part of it; and

(h)            any defense based on or arising out of any action of
Administrative Agent or any Lender described in Section 3 or Section 4.

Section 7.                Waivers of Subrogation and Other Rights and Defenses.

(a)            Upon a default by Borrower, Administrative Agent and/or any other
Guaranteed Party in their sole discretion, without prior notice to or consent of
Guarantor, may elect to: (i) foreclose either judicially or nonjudicially
against any real or personal property security they may hold for the Credit
Line, (ii) accept a transfer of any such security in lieu of foreclosure, (iii)
compromise or adjust the Credit Line or any part of it or make any other
accommodation with Borrower or Guarantor, or (iv) exercise any other remedy
against Borrower or any security.  No such action by Administrative Agent and/or
any other Guaranteed Party shall release or limit the liability of Guarantor,
who shall remain liable under this Guaranty after the action, even if the effect
of the action is to deprive Guarantor of any subrogation rights, rights of
indemnity, or other rights to collect reimbursement from Borrower for any sums
paid to Administrative Agent for its own account or for the account of any other
Guaranteed Party, whether contractual or arising by operation of law or
otherwise.  Guarantor expressly agrees that under no circumstances shall it be
deemed to have any right, title, interest or claim in or to any real or personal
property to be held by Administrative Agent or any other Guaranteed Party or any
third party after any foreclosure or transfer in lieu of foreclosure of any
security for the Credit Line.

 
F-1-4

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(b)            Regardless of whether Guarantor may have made any payments to
Administrative Agent for its own account or for the account of any other
Guaranteed Party, Guarantor waives, until all indebtedness, liabilities and
other obligations of Borrower to the Guaranteed Parties under or in connection
with the Agreement, the Notes and the other Loan Documents have been
indefeasibly paid in full: (i) all rights of subrogation, all rights of
indemnity, and any other rights to collect reimbursement from Borrower for any
sums paid to Administrative Agent or any other Guaranteed Party, whether
contractual or arising by operation of law (including the United States
Bankruptcy Code or any successor or similar statute) or otherwise, (ii) all
rights to participate in any security now or later to be held by Administrative
Agent or the other Guaranteed Parties for the Credit Line, and (iii) all rights
to enforce any remedy that Administrative Agent or any other Guaranteed Party
may have against Borrower.

(c)            Guarantor waives Guarantor’s rights of subrogation and
reimbursement and any other rights and defenses available to Guarantor by reason
of Sections 2787 to 2855, inclusive, of the California Civil Code including,
without limitation, any defenses Guarantor may have to the Guaranty obligation
by reason of an election of remedies by Administrative Agent or any other
Guaranteed Party, and any and all benefits that otherwise might be available to
such Guarantor under California Civil Code §§1432, 2809, 2810, 2815, 2819, 2839,
2845, 2848, 2849, 2850, 2899 and 3433 and California Code of Civil Procedure
§§580a, 580b, 580d and 726.  Accordingly, Guarantor waives all rights and
defenses that Guarantor may have because Borrower’s debt may at any time be
secured by real property.  This means, among other things: (A) the Guaranteed
Parties may collect from Guarantor without first foreclosing on any real or
personal property collateral that may at any time be pledged by Borrower; and
(B) if the Administrative Agent forecloses on any real property collateral that
may at any time be pledged by Borrower: (1) the amount of the debt may be
reduced only by the price for which such collateral is sold at the foreclosure
sale, even if such collateral is worth more than the sale price, and (2) the
Guaranteed Parties may collect from Guarantor even if the Administrative Agent,
by foreclosing on such real property collateral, has destroyed any right
Guarantor may have to collect from Borrower.  This is an unconditional and
irrevocable waiver of any rights and defenses Guarantor may have because
Borrower’s debt may at any time be secured by real property.  These rights and
defenses include, but are not limited to, any rights of defenses based upon
Section 580a, 580b, 580d or 726 of the California Code of Civil Procedure.

(d)            Guarantor waives all right and defenses arising out of an
election of remedies by Administrative Agent or the other Guaranteed Parties,
even though that election of remedies has destroyed Guarantor’s rights of
subrogation and reimbursement against Borrower.

(e)            No provision or waiver in this Guaranty shall be construed as
limiting the generality of any other waiver contained in this Guaranty.

Section 8.              Continuing Guaranty; Reinstatement.  This Guaranty is a
continuing guaranty and agreement of subordination relating to any Guaranteed
Obligations, including Guaranteed Obligations which may exist continuously or
which may arise from time to time under successive transactions, and Guarantor
expressly acknowledges that this Guaranty shall remain in full force and effect
notwithstanding that there may be periods in which no Guaranteed Obligations
exist.  This Guaranty shall continue in effect and be binding upon Guarantor
until termination of the Commitments and payment and performance in full of the
Guaranteed Obligations.  This Guaranty shall continue to be effective or shall
be reinstated and revived, as the case may be, if, for any reason, any payment
of the Guaranteed Obligations by or on behalf of Borrower shall be rescinded,
invalidated, declared to be fraudulent or preferential, set aside, voided or
otherwise required to be repaid to Borrower, its estate, trustee, receiver or
any other Person (including under the Bankruptcy Code or other state or federal
law), or must otherwise be restored by any Guaranteed Party, whether as a result
of Insolvency Proceedings or otherwise.  To the extent any payment is so
rescinded, set aside, voided or otherwise repaid or restored, the Guaranteed
Obligations shall be revived in full force and effect without reduction or
discharge for such payment.

 
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Section 9.               Information Regarding Borrower and the
Property.  Before signing this Guaranty, Guarantor investigated the financial
condition and business operations of Borrower, the present and former condition,
uses and ownership of the Unencumbered Asset Pool, and such other matters as
Guarantor deemed appropriate to assure itself of Borrower’s ability to discharge
its obligations under the Loan Documents.  Guarantor assumes full responsibility
for that due diligence, as well as for keeping informed of all matters which may
affect Borrower’s ability to pay and perform its obligations to Administrative
Agent and the other Guaranteed Parties.  Neither Administrative Agent nor any
Lender has a duty to disclose to Guarantor any information that Administrative
Agent or any Lender may have or receive about Borrower’s financial condition or
business operations, or any other circumstances bearing on Borrower’s ability to
perform.

Section 10.             Subordination.  Any rights of Guarantor, whether now
existing or later arising, to receive payment on account of any indebtedness
(including interest) owed to it by Borrower, or to withdraw capital invested by
it in Borrower, or to receive distributions from Borrower, shall at all times be
subordinate as to lien and time of payment and in all other respects to the full
and prior repayment to Administrative Agent and the other Guaranteed Parties of
the Credit Line.  Guarantor shall not be entitled to enforce or receive payment
of any sums hereby subordinated until the Credit Line has been paid and
performed in full and any such sums received in violation of this Guaranty shall
be received by Guarantor in trust for Administrative Agent and the other
Guaranteed Parties.  The foregoing notwithstanding, Guarantor is not prohibited
from receiving (a) such reasonable management fees or reasonable salary from
Borrower as Administrative Agent may find reasonably acceptable from time to
time, (b) distributions from Borrower in an amount equal to any income taxes
imposed on Guarantor which are attributable to Borrower’s income from any
property owned by Borrower, and (c) distributions or dividends from Borrower
from cash flow available for such distributions or dividends that was earned
during the immediately preceding fiscal year in an amount that does not exceed
ninety-five percent (95%) of Funds From Operations on a rolling four calendar
quarter basis.  Notwithstanding the above, Guarantor may receive distributions
from Borrower to pay common and preferred stock dividends in any calendar
quarter in an amount that exceeds Funds From Operations for such calendar
quarter only to the extent necessary to enable Guarantor to make distributions
necessary to continue to qualify as a REIT as that term is defined in Section
12(b).

 
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Section 11.             Guarantor’s Representations and Warranties.  Guarantor
represents and warrants that:

(a)            Financial Statements True and Correct.  All financial statements
and other financial information furnished or to be furnished to Administrative
Agent are or will be true and correct in all material respects determined
according to GAAP unless otherwise provided for herein and do or will fairly
represent the financial condition of Guarantor (including all contingent
liabilities) (for purposes of this Section 11(a), the term “material respects”
means any variance in the aggregate amount of $10,000,000.00);

(b)            Financial Statements According to GAAP.  All financial statements
were or will be prepared in accordance with GAAP;

(c)            No Material Adverse Change.  There has been no material adverse
change in Guarantor’s financial condition since the dates of the statements most
recently furnished to Administrative Agent;

(d)            Organization of Guarantor.  Guarantor is a corporation duly
formed, validly existing and in good standing under the laws of Maryland;

(e)            Authorization.  The execution and compliance with this Guaranty,
the Agreement, and the other Loan Documents to which Guarantor is a party are
within Guarantor’s powers, have been duly authorized, and do not conflict with
any of Guarantor’s organizational documents;

(f)            Enforceable Agreement.  This Guaranty is a legal, valid and
binding agreement of Guarantor, enforceable against Guarantor in accordance with
its terms, and any other Loan Document to which Guarantor is a party, when
executed and delivered, will be similarly legal, valid, binding and enforceable,
except to the extent that the enforcement of the rights and remedies of
Administrative Agent or the other Guaranteed Parties may hereafter be subject to
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
generally the enforcement of creditors’ rights and remedies, and the
availability of equitable remedies may be subject to the discretion of the court
before which any proceeding thereof is brought;

(g)            Good Standing.  In each state in which Guarantor does business,
it is, where required, properly licensed, in good standing and in compliance
with fictitious name statutes;

(h)            No Conflicts.  Guarantor, to the best of its knowledge, is not in
violation of, nor do the terms of this Guaranty or any other Loan Document
conflict with, any law (including Environmental Laws), regulation or ordinance,
any order of any court or governmental entity, or any covenant or agreement
affecting Guarantor which would materially and adversely affect Guarantor’s
ability to perform its obligations under this Guaranty or under any other Loan
Document to which Guarantor is a party;

 
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(i)             Lawsuits.  There is no lawsuit, tax claim or other dispute
pending or threatened against Guarantor which, if lost, would materially
adversely impair Guarantor’s financial condition or ability to repay the Credit
Line;

(j)             Other Obligations.  Guarantor is not in material default (taking
into account all applicable cure periods, if any) on any material obligation for
borrowed money, any purchase money obligation or any other material lease,
commitment, contract, instrument or obligation;

(k)            No Required Third Party/Governmental Approvals.  No approval,
consent, exemption, authorization, or other action by, or notice to, or filing
with any third party or any Governmental Authority, is necessary or required in
connection with the execution, delivery or performance of this Guaranty or any
other Loan Document to which Guarantor is a party; and

(l)             Solvency.  Immediately prior to and after and giving effect to
the incurrence of Guarantor’s obligations under this Guaranty Guarantor is and
will be Solvent.  “Solvent” shall mean that (i) the fair value of Guarantor’s
assets is greater than the amount of Guarantor’s liabilities as such value is
established and liabilities evaluated for purposes of Section 101(32) of the
Bankruptcy Code and, in the alternative, for purposes of the California Uniform
Fraudulent Transfer Act and any other applicable fraudulent conveyance statute;
(ii) the present fair saleable value of Guarantor’s assets is not less than the
amount that will be required to pay the probable liability of Guarantor on its
debts as they become absolute and matured; (iii) Guarantor is able to realize
upon its assets and pay its debts and other liabilities as they mature in the
normal course of business; (iv) Guarantor does not intend to, and does not
believe that it will, incur debts or liabilities beyond Guarantor’s ability to
pay as such debts and liabilities mature; and (v) Guarantor is not engaged in
business or a transaction, and is not about to engage in business or a
transaction, for which Guarantor’s property would constitute unreasonably small
capital.

Section 12.             Guarantor promises to keep each of the following
covenants:

(a)            Compliance with Law.  Guarantor shall comply with all existing
and future laws, regulations, orders, building restrictions and requirements of,
and all agreements with and commitments to, all Governmental Authorities having
jurisdiction over Guarantor or Guarantor’s business.  Notwithstanding any
contrary provision in this Section, Guarantor shall have a right to contest all
existing and future Requirement of Law before complying therewith.

(b)            REIT Status.  Guarantor has elected and shall continue to elect
to be taxed as, and shall conduct its affairs in a manner so as to retain its
status as a real estate investment trust (“REIT”) pursuant to Sections 856 and
857 of the Internal Revenue Code of 1986, as amended from time to time (the
“Code”).

(c)            Stock Listing.  Guarantor shall maintain a listing on the New
York Stock Exchange.

(d)            Financial and Other Information.  Guarantor shall keep true and
correct financial books and records, using generally accepted accounting
principles consistently applied, or such other accounting principles as
Administrative Agent in its reasonable judgment may find acceptable from time to
time.  Guarantor shall provide Administrative Agent with the items specified in
Sections 6.3(a), (b), (c), (d), (f), (g), (i), (j) and (k) of the Agreement with
respect to Guarantor, and any other financial or other information concerning
Guarantor’s affairs and property as Administrative Agent may reasonably request,
to be furnished promptly upon such request.

 
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(e)            Agreement Covenants.  Guarantor shall observe, perform and comply
with all covenants expressly applicable to Guarantor set forth in Articles 6 and
10 of the Agreement, which by their terms Borrower is required to cause
Guarantor to observe, perform and comply with, as if such covenants were set
forth in full herein.

Section 13.             Negative Covenants.

(a)            Without Required Lender’s prior written consent, which consent
shall not be unreasonably withheld or delayed, Guarantor shall not:

(i)             enter into or invest in any consolidation, merger, pool,
syndicate or other combination unless Guarantor is the surviving entity and
control of Guarantor does not change;

(ii)            change the legal structure of Guarantor from a publicly traded
real estate investment trust under the provisions of Sections 856 and 857 of the
Code, or change the legal structure of Guarantor as a so-called up-REIT, or
without 30 days’ prior written notice to Administrative Agent, change
Guarantor’s jurisdiction of formation, place of business or chief executive
office if Guarantor has more than one place of business; or

(iii)           withdraw as Borrower’s general partner, or allow Guarantor to
suffer a change in its executive management such that Keith Guericke is no
longer Chief Executive Officer and he is not replaced by Michael J. Schall,
George M. Marcus is no longer Chairman of the Board of Directors or Michael J.
Schall is no longer Chief Operating Officer (unless he becomes Chief Executive
Officer), unless such executive management is replaced by parties reasonably
acceptable to Administrative Agent within 180 days.

(b)            Guarantor shall not in any case:

(i)             form additional unconsolidated down-REITs for property
acquisitions (an “Acquisition down-REIT”) unless they comply on an on-going
basis with each of the following conditions:

(A)           such Acquisition down-REIT is a limited partnership or limited
liability company, and Essex Management Corporation (“EMC”) or any wholly owned
subsidiary of Borrower or Guarantor shall be the sole general partner of any
such partnership or the sole managing member of such limited liability company;

(B)           Guarantor and/or Borrower and/or EMC shall have effective
management control of each Acquisition down-REIT and each property owned by such
Acquisition down-REIT; and

 
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(C)           limited partners or members of such Acquisition down-REIT shall
receive only partnership units or membership interests in the Acquisition
down-REIT and/or cash for value contributed;

(ii)            liquidate or dissolve Guarantor’s business or, as general
partner of Borrower, cause or permit Borrower to liquidate or dissolve
Borrower’s business; or

(iii)           dispose of all or substantially all of Guarantor’s business or
Guarantor’s assets or, as general partner of Borrower, cause or permit Borrower
to dispose of all or substantially all of Borrower’s business or Borrower’s
assets.

Section 14.             Governing Law; Jurisdiction and Dispute Resolution.

(i)             GOVERNING LAW. THIS GUARANTY IS TO BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF CALIFORNIA (AS PERMITTED
BY SECTION 1646.5 OF THE CALIFORNIA CIVIL CODE OR ANY SIMILAR SUCCESSOR
PROVISION), WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW RULE THAT WOULD CAUSE THE
APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE INTERNAL LAWS OF THE
STATE OF CALIFORNIA TO THE RIGHTS AND DUTIES OF THE PARTIES.

(ii)            SUBMISSION TO JURISDICTION. GUARANTOR AND, BY ITS ACCEPTANCE OF
THIS GUARANTY, THE ADMINISTRATIVE AGENT, EACH IRREVOCABLY AND UNCONDITIONALLY
SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF CALIFORNIA SITTING IN SAN FRANCISCO COUNTY AND OF THE
UNITED STATES DISTRICT COURT OF THE NORTHERN DISTRICT OF CALIFORNIA, AND ANY
APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR
ENFORCEMENT OF ANY JUDGMENT, AND GUARANTOR AND EACH GUARANTEED PARTY (BY ITS
ACCEPTANCE OF THIS GUARANTY) IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL
CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED
IN SUCH CALIFORNIA STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, IN SUCH FEDERAL COURT.  GUARANTOR AND EACH GUARANTEED PARTY (BY ITS
ACCEPTANCE OF THIS GUARANTY) AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.  NOTHING IN THIS
GUARANTY OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT ANY
GUARANTEED PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING
TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT AGAINST GUARANTOR OR ITS PROPERTIES
IN THE COURTS OF ANY JURISDICTION WHERE THE GUARANTOR OR ITS PROPERTIES ARE
LOCATED.

 
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(iii)           WAIVER OF VENUE.  GUARANTOR AND, BY ITS ACCEPTANCE OF THIS
GUARANTY, THE ADMINISTRATIVE AGENT, EACH IRREVOCABLY AND UNCONDITIONALLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW
OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED
TO IN PARAGRAPH (i) OF THIS SECTION.  GUARANTOR AND EACH GUARANTEED PARTY (BY
ITS ACCEPTANCE OF THIS GUARANTY) HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

(iv)           SERVICE OF PROCESS.  GUARANTOR IRREVOCABLY CONSENTS TO SERVICE OF
PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 20.  NOTHING IN THIS
GUARANTY WILL AFFECT THE RIGHT OF ANY GUARANTEED PARTY TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY APPLICABLE LAW.

(v)            WAIVER OF JURY TRIAL.  GUARANTOR AND EACH OTHER GUARANTEED PARTY
(BY ITS ACCEPTANCE HEREOF) HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY
LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
GUARANTY OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  GUARANTOR AND
EACH GUARANTEED PARTY (BY ITS ACCEPTANCE HEREOF) (i) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (ii) ACKNOWLEDGES THAT IT HAVE BEEN INDUCED
TO ENTER INTO THIS GUARANTY AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

(vi)           Judicial Reference.  If any action or proceeding by or against
any party hereto in connection with any of the transactions contemplated by this
Guaranty or any other Loan Document is filed in a forum in which predispute
waivers of the right to trial by jury are invalid under applicable law, (a) the
court shall, and is hereby directed to, make a general reference pursuant to
California Code of Civil Procedure Section 638 (or similar applicable law) to a
referee (who shall be a single active or retired judge) to hear and determine
all of the issues in such action or proceeding (whether of fact or of law) and
to report a statement of decision, provided that at the option of any party to
such proceeding, any such issues pertaining to a “provisional remedy” (or
similar term) as defined in California Code of Civil Procedure Section 1281.8
(or similar applicable law) shall be heard and determined by the court, and (b)
the prevailing party, or the non-dismissing party in the event of a voluntary
dismissal by the party instituting the action, shall be entitled to the full
amount of all fees and expenses of any referee appointed in such action or
proceeding.

 
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Section 15.            Authorization; No Violation.  Guarantor is authorized to
execute, deliver and perform under this Guaranty, which is a valid and binding
obligation of Guarantor, except as the same may be limited by insolvency,
bankruptcy, reorganization, or other laws relating to or affecting the
enforcement of creditors’ rights or by general equitable principles.  No
provision or obligation of Guarantor contained in this Guaranty violates any
applicable law, regulation or ordinance, or any order or ruling of any court or
governmental agency.  No such provision or obligation conflicts with, or
constitutes a breach or default under, any agreement to which Guarantor is a
party.  No consent, approval or authorization of or notice to any person or
entity is required in connection with Guarantor’s execution of and obligations
under this Guaranty.

Section 16.            Additional and Independent Obligations.  Guarantor’s
obligations under this Guaranty are in addition to its obligations under any
other existing or future guaranties, each of which shall remain in full force
and effect until it is expressly modified or released in a writing signed by
Administrative Agent.  Guarantor’s obligations under this Guaranty are
independent of those of Borrower on the Credit Line.  Administrative Agent or
any other Guaranteed Party may bring a separate action, or commence a separate
reference or arbitration proceeding against Guarantor without first proceeding
against Borrower, any other person or any security that Administrative Agent or
any other Guaranteed Party may hold, and without pursuing any other
remedy.  Administrative Agent’s rights under this Guaranty shall not be
exhausted by any action by Administrative Agent until the Credit Line has been
paid and performed in full.

Section 17.            No Waiver; Consents; Cumulative Remedies.  Each waiver by
Administrative Agent must be in writing, and no waiver shall be construed as a
continuing waiver.  No waiver shall be implied from Administrative Agent’s or
any other Guaranteed Party’s delay in exercising or failure to exercise any
right or remedy against Borrower, Guarantor or any security.  Consent by
Administrative Agent or the other Guaranteed Parties to any act or omission by
Borrower or Guarantor shall not be construed as a consent to any other or
subsequent act or omission, or as a waiver of the requirement for Administrative
Agent’s or the other Guaranteed Parties’ consent to be obtained in any future or
other instance.  All remedies of Administrative Agent or the other Guaranteed
Parties against Borrower and Guarantor are cumulative.

Section 18.             No Release.  Guarantor shall not be released from its
obligations under this Guaranty except by a writing signed by Administrative
Agent and the other Guaranteed Parties.

Section 19.             Heirs, Successors and Assigns; Participations.  The
terms of this Guaranty shall bind and benefit the heirs, legal representatives,
successors and assigns of Administrative Agent, each Guaranteed Party and
Guarantor; provided, however, that Guarantor may not assign this Guaranty, or
assign or delegate any of its rights or obligations under this Guaranty, without
the prior written consent of Administrative Agent, given only with the consent
of all of the other Guaranteed Parties in each instance.  Each Lender shall have
the right to transfer its Commitment and its outstanding Loans to any other
Person on the terms and subject to the conditions set forth in Section 10.5 of
the Agreement.  Without the consent of or notice to Guarantor, Administrative
Agent and the other Guaranteed Parties may disclose to any prospective or actual
purchasers of any interest in any Loan or any other loans made by Lenders to
Borrower (in the case of a prospective purchase of an interest in the Loans or
any other loan, upon Lender’s receiving its standard confidentiality letter from
the prospective purchaser of the interest in the Loan or any other loan), any
financial or other information relating to Guarantor, this Guaranty or any
security that may at any time be given for this Guaranty.

 
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Section 20.             Notices.  All notices and other communications provided
for herein shall be in writing and shall be delivered by hand or overnight
courier service, mailed by certified or registered mail or sent by telecopier,
in the case of Guarantor, to the address or telecopier number specified on the
signature page hereof, and in the case of the Administrative Agent, the L/C
Issuer and the Lenders, to the addresses or telecopier numbers specified in the
Credit Agreement.  Notices sent by hand or overnight courier service, or mailed
by certified or registered mail, shall be deemed to have been given when
received; notices sent by telecopier shall be deemed to have been given when
sent (except that, if not given during normal business hours for the recipient,
shall be deemed to have been given at the opening of business on the next
business day for the recipient).  Each of Guarantor and the Guaranteed Parties
may change its address or telecopier number for notices and other communications
hereunder by notice to the other parties.

Section 21.             Rules of Construction.  In this Guaranty, the word
“Borrower” includes each of the named Borrower, each other Loan Party and any
other person who at any time assumes or otherwise becomes primarily liable for
all or any part of the obligations of the named Borrower on the Credit
Line.  The word “person” includes any individual, company, trust or other legal
entity of any kind.  The word “include(s)” means “include(s), without
limitation,” and the word “including” means “including, but not limited to.”
When the context and construction so require, all words used in the singular
shall be deemed to have been used in the plural and vice versa.  No listing of
specific instances, items or matters in any way limits the scope or generality
of any language of this Guaranty.  All headings appearing in this Guaranty are
for convenience only and shall be disregarded in construing this Guaranty.  The
rules of interpretation set forth in Section 1.2 of the Agreement shall be
applicable to this Guaranty and are incorporated herein by this reference.

Section 22.             Costs and Expenses; Indemnification.

(a)            Costs and Expenses.  Guarantor shall pay (i) all reasonable
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates
(including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent), in connection with the preparation, negotiation,
execution and delivery of this Guaranty and the other Guarantor Documents or any
amendments, modifications or waivers of the provisions hereof or thereof
(whether or not the transactions contemplated hereby or thereby shall be
consummated), and (ii) all out-of-pocket expenses incurred by the Administrative
Agent or any other Guaranteed Party (including the fees, charges and
disbursements of any counsel for any Guaranteed Party), in connection with the
enforcement or protection of its rights in connection with this Guaranty and the
other Loan Documents, including its rights under this Section, including all
such out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of the Guaranteed Obligations.

 
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(b)            Indemnification.  Guarantor shall indemnify the Administrative
Agent (and any sub-agent thereof), each other Guaranteed Party, and each Related
Party of any of the foregoing Persons (each such Person being called an
“Indemnitee”) against, and hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and related expenses (including the fees,
charges and disbursements of any counsel for any Indemnitee), incurred by any
Indemnitee or asserted against any Indemnitee by any third party or by Guarantor
or any other Loan Party arising out of, in connection with, or as a result of
(i) the execution or delivery of this Guaranty or any other Loan Document or any
agreement or instrument contemplated hereby or thereby, the performance by the
parties hereto or thereto of their respective obligations hereunder or
thereunder or the consummation of the transactions contemplated hereby or
thereby, (ii) any Loan or Letter of Credit or the use or proposed use of the
proceeds therefrom (including any refusal by the L/C Issuer to honor a demand
for payment under a Letter of Credit if the documents presented in connection
with such demand do not strictly comply with the terms of such Letter of
Credit), (iii) any actual or alleged presence or release of Hazardous Materials
on or from any property owned or operated by Borrower or any of its
Subsidiaries, or any Environmental Liability related in any way to Borrower or
any of its Subsidiaries, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory, whether brought by a third party or by
Borrower or any other Loan Party, and regardless of whether any Indemnitee is a
party thereto; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related expenses (x) are determined by a court of competent jurisdiction by
final and nonappealable judgment to have resulted from the gross negligence or
willful misconduct of such Indemnitee or (y) result from a claim brought by
Borrower or any other Loan Party against an Indemnitee for breach in bad faith
of such Indemnitee’s obligations hereunder or under any other Loan Document, if
Borrower or such other Loan Party has obtained a final and nonappealable
judgment in its favor on such claim as determined by a court of competent
jurisdiction.

(c)            Interest.  Any amounts payable to by Guarantor under this Section
22 or otherwise under this Guaranty if not paid upon demand shall bear interest
from the date of such demand until paid in full, at a fluctuating interest rate
per annum at all times equal to the Default Rate applicable to Reference Rate
Committed Loans to the fullest extent permitted by applicable Law.  Any such
interest shall be due and payable upon demand and shall be calculated on the
basis of a year of 365 or 366 days, as the case may be, and the actual number of
days elapsed.

(d)            Payment.  All amounts due under this Section 22 shall be payable
within fifteen days after demand therefor.

(e)            Survival.  The agreements in this Section 22 shall survive the
resignation of the Administrative Agent and the L/C Issuer, the replacement of
any Lender, the termination of the Commitments and the repayment, satisfaction
or discharge of all the other Guaranteed Obligations.

Section 23.             Consideration.  Guarantor acknowledges that it expects
to benefit from Lenders’ extension of the Credit Line to Borrower because of its
relationship to Borrower, and that it is executing this Guaranty in
consideration of that anticipated benefit.

 
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Section 24.             Payments.

(a)            Guarantor hereby agrees, in furtherance of the foregoing
provisions of this Guaranty and not in limitation of any other right which any
Guaranteed Party or any other Person may have against Guarantor by virtue
hereof, upon the failure of Borrower to pay any of the Guaranteed Obligations
when and as the same shall become due, whether at stated maturity, by required
prepayment, declaration, acceleration, demand or otherwise (including amounts
that would become due but for the operation of the automatic stay under §362(a)
of the Bankruptcy Code), Guarantor shall forthwith pay, or cause to be paid, in
cash, to the Administrative Agent an amount equal to the amount of the
Guaranteed Obligations then due as aforesaid (including interest which, but for
the filing of a petition in any Insolvency Proceeding with respect to Borrower,
would have accrued on such Guaranteed Obligations, whether or not a claim is
allowed against Borrower for such interest in any such Insolvency
Proceeding).  Guarantor shall make each payment hereunder, unconditionally in
full without set-off, counterclaim or other defense, on the day when due in
Dollars, in immediately available funds, to the Administrative Agent at such
office of the Administrative Agent and to such account as the Administrative
Agent shall specify in writing to Guarantor.

(b)            Any and all payments by or on account of any Guaranteed
Obligation hereunder or under any other Guarantor Document shall be made free
and clear of and without reduction or withholding for any Indemnified Taxes or
Other Taxes, provided that if Guarantor shall be required by applicable law to
deduct any Indemnified Taxes (including any Other Taxes) from such payments,
then (i) the sum payable shall be increased as necessary so that after making
all required deductions (including deductions applicable to additional sums
payable under this Section) the Guaranteed Party receives an amount equal to the
sum it would have received had no such deductions been made, (ii) Guarantor
shall make such deductions and (iii) Guarantor shall timely pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
law.

(c)            Without limiting the provisions of paragraph (b) above, Guarantor
shall timely pay any Other Taxes to the relevant Governmental Authority in
accordance with applicable law.

(d)            Guarantor shall indemnify the Guaranteed Parties, within ten days
after demand therefor, for the full amount of any Indemnified Taxes or Other
Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) paid by the Guaranteed
Parties and any penalties, interest and reasonable expenses arising therefrom or
with respect thereto, whether or not such Indemnified Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental
Authority.  A certificate as to the amount of such payment or liability
delivered to Guarantor by a Guaranteed Party (with a copy to the Administrative
Agent), or by the Administrative Agent on its own behalf or on behalf of another
Guaranteed Party, shall be conclusive absent manifest error.

(e)            As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by Guarantor to a Governmental Authority, Guarantor shall deliver to
the Administrative Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Administrative Agent.

 
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(f)             Any payments by Guarantor hereunder the application of which is
not otherwise provided for herein, shall be applied in the order specified in
Section 8.3 of the Credit Agreement.

(g)            To the extent that any payment by or on behalf of Borrower is
made to the Administrative Agent or any other Guaranteed Party, or the
Administrative Agent or any other Guaranteed Party exercises its right of
setoff, and such payment or the proceeds of such setoff or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required (including pursuant to any settlement entered into by the
Administrative Agent or any other Guaranteed Party in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Insolvency Proceeding or otherwise, then (i) to the extent
of such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred, and (ii) each Lender
and the L/C Issuer severally (by its acceptance hereof) agrees to pay to the
Administrative Agent upon demand its applicable share (without duplication) of
any amount so recovered from or repaid by the Administrative Agent, plus
interest thereon from the date of such demand to the date such payment is made
at a rate per annum equal to the Federal Funds Rate from time to time in
effect.  The obligations of the Lenders and the L/C Issuer under clause (ii) of
the preceding sentence shall survive the payment in full of the Guaranteed
Obligations and the termination of this Guaranty.

(h)            Notwithstanding anything to the contrary contained herein or in
Guarantor Document, the interest paid or agreed to be paid hereunder and under
the other Guarantor Documents shall not exceed the maximum rate of non-usurious
interest permitted by applicable Law (the “Maximum Rate”).  If the
Administrative Agent or any other Guaranteed Party shall receive interest in an
amount that exceeds the Maximum Rate, the excess interest shall be applied to
the principal of the Guaranteed Obligations or, if it exceeds such unpaid
principal, refunded to Guarantor.  In determining whether the interest
contracted for, charged, or received by the Administrative Agent or any other
Guaranteed Party exceeds the Maximum Rate, such Person may, to the extent
permitted by applicable Law, (i) characterize any payment that is not principal
as an expense, fee, or premium rather than interest, (ii) exclude voluntary
prepayments and the effects thereof, and (iii) amortize, prorate, allocate, and
spread in equal or unequal parts the total amount of interest throughout the
contemplated term of the Obligations hereunder.

(i)             The agreements in this Section 24 shall survive the payment of
all Guaranteed Obligations.

Section 25.            Stay of Acceleration.  In the event that acceleration of
the time for payment of any of the obligations guaranteed hereunder is stayed,
in connection with any Insolvency Proceeding commenced by or against Guarantor
or Borrower, or otherwise, all such amounts shall nonetheless be payable by
Guarantor immediately upon demand by the Administrative Agent.

 
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Section 26.             Setoff.  If an Event of Default shall have occurred and
be continuing, each Lender and the L/C Issuer is hereby authorized at any time
and from time to time, to the fullest extent permitted by applicable law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final, in whatever currency) at any time held and other
obligations (in whatever currency) at any time owing by such Lender or the L/C
Issuer to or for the credit or the account of Guarantor against any and all of
the obligations of Guarantor now or hereafter existing under this Guaranty or
any other Guarantor Document to such Lender or the L/C Issuer, irrespective of
whether or not such Lender or the L/C Issuer shall have made any demand under
this Guaranty or any other Loan Document and although such obligations of
Guarantor may be contingent or unmatured or are owed to a branch or office of
such Lender or the L/C Issuer different from the branch or office holding such
deposit or obligated on such indebtedness.  The rights of each Lender and the
L/C Issuer under this Section are in addition to other rights and remedies
(including other rights of setoff) that such Lender or the L/C Issuer may
have.  Each Lender and the L/C Issuer (by its acceptance hereof) agrees to
notify Guarantor and the Administrative Agent promptly after any such setoff and
application, provided that the failure to give such notice shall not affect the
validity of such setoff and application.

Section 27.             Integration; Modifications.  This Guaranty (a)
integrates all the terms and conditions mentioned in or incidental to this
Guaranty, (b) supersedes all oral negotiations and prior writings with respect
to its subject matter, and (c) is intended by Guarantor, the Administrative
Agent and the other Guaranteed Parties as the final expression of the agreement
with respect to the terms and conditions set forth in this Guaranty and as the
complete and exclusive statement of the terms agreed to by Guarantor, the
Administrative Agent and the other Guaranteed Parties.  No representation,
understanding, promise or condition shall be enforceable against Guarantor or
any Guaranteed Party unless it is contained in this Guaranty.  This Guaranty may
not be modified except in a writing signed by both Administrative Agent and
Guarantor.  No course of prior dealing, usage of trade, parol or extrinsic
evidence of any nature shall be used to supplement, modify or vary any of the
terms hereof.

Section 28.             Miscellaneous.  The legal incapacity of any Guarantor
shall not terminate the obligations of such Guarantor under this Guaranty,
including its obligations with regard to future advances under the Loan
Documents.  The liability of all persons who are in any manner obligated under
this Guaranty shall be joint and several.  The illegality or unenforceability of
one or more provisions of this Guaranty shall not affect any other
provision.  Time is of the essence in the performance of this Guaranty by
Guarantor.

Section 29.             Counsel.  Guarantor acknowledges that Guarantor has had
adequate opportunity to carefully read this Guarantee and to consult with an
attorney of Guarantor’s choice prior to signing it.

Section 30.             USA PATRIOT Act Notice.  Each Lender that is subject to
the Act (as hereinafter defined) and the Administrative Agent (for itself and
not on behalf of any Lender) hereby notifies Guarantor that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Act”), it is required to obtain, verify and record
information that identifies Guarantor, which information includes the name and
address of Guarantor and other information that will allow such Lender or the
Administrative Agent, as applicable, to identify Guarantor in accordance with
the Act.

 
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Section 31.             Time is of the Essence.  Time is of the essence of this
Guaranty and the other Guarantor Documents.

Section 32.             Severability.  If any provision of this Guaranty or the
other Guarantor Documents is held to be illegal, invalid or unenforceable, (a)
the legality, validity and enforceability of the remaining provisions of this
Guaranty and the other Guarantor Documents shall not be affected or impaired
thereby and (b) the parties shall endeavor in good faith negotiations to replace
the illegal, invalid or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the illegal,
invalid or unenforceable provisions.  The invalidity of a provision in a
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.

Section 33.             Defined Terms.  As used in this Guaranty (including in
the recitals hereof), the following terms shall have the following meanings:

“Bankruptcy Code” means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C.
§101, et seq.).

“Excluded Taxes” means, with respect to any Guaranteed Party or any other
recipient of any payment to be made by or on account of any Guaranteed
Obligation hereunder, (a) taxes imposed on or measured by its overall net income
(however denominated), and franchise taxes imposed on it, under the laws of any
Governmental Authority, (b) any branch profits taxes imposed by any Governmental
Authority, and (c) in the case of a Guaranteed Party that is a Foreign Lender,
any withholding tax that is imposed on amounts payable to such Foreign Lender at
the time such Foreign Lender becomes a party to the Agreement (or designates a
new Lending Office) or is attributable to such Foreign Lender’s failure or
inability (other than as a result of a Change in Law) to comply with Section
3.1.5 of the Agreement, except to the extent that such Foreign Lender (or its
assignor, if any) was entitled, at the time of designation of a new Lending
Office (or assignment), to receive additional amounts with respect to such
withholding tax pursuant to Section 3.1.5 of the Agreement.

“Guaranteed Obligations” means the obligations guaranteed by Guarantor
hereunder, as set forth in Sections 1 and 2.

“Guaranteed Parties” means the Administrative Agent, the L/C Issuer, the Swing
Line Lender and the Lenders.

“Guarantor Documents” means this Guaranty and all other certificates, documents,
agreements and instruments delivered to any Guaranteed Party under or in
connection with this Guaranty.

“Indemnified Taxes” means Taxes other than Excluded Taxes.

“Loan Party” means Borrower, Guarantor and each Permitted Affiliate.

“Other Taxes” means all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any
payment made hereunder or under any other Guarantor Document or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Guaranty or any other Guarantor Document.  Other Taxes shall not include any
Excluded Taxes.

 
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“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental
Authority and arising from any payment made hereunder or under any other
Guarantor Document or from the execution, delivery or enforcement of, or
otherwise with respect to, this Guaranty or any other Guarantor Document,
including any interest, additions to tax or penalties applicable thereto.

IN WITNESS WHEREOF, Guarantor has executed this Payment Guaranty, as of the date
first above written.

 
ESSEX PROPERTY TRUST, INC.,
   
a Maryland corporation
                   
By:
     
Name:
     
Title:
                     
Address Where Notices to Guarantor are to be
           
Essex Property Trust, Inc.
   
925 E. Meadow Drive
   
Palo Alto, California  94303
   
Attn:  Mark J. Mikl; Jordan E. Ritter and Michael T. Dance
   
Facsimile:
(650) 843-1514; (650) 858-1372
     
and (650) 858-0139
           
Address Where Notices to Administrative Agent
   
are to be sent:
           
PNC Bank, National Association
   
500 First Avenue
   
Pittsburgh PA  5219
   
Attention:  Trina Barkley
   
Mail Stop:  P7-PFSC-04-P
   
Telephone:  412-768-0423
   
Facsimile:  412-762-8672
   
Email:  trina.barkley@pncbank.com
           
and
           
PNC Real Estate
   
One PNC Plaza, 249 Fifth Avenue
   
Pittsburgh PA  15222
 

 
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Attention:  Karen Kennedy
 
Mailstop:  P1-POPP-19-1
 
Telephone:  412-762-3293
 
Facsimile:  412-762-6500
 
Email:  kkennedy@pnc.com

 
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EXHIBIT F-2

FORM OF PAYMENT GUARANTY (PERMITTED AFFILIATE)

[See Attached]

 
F-2

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PAYMENT GUARANTY
(Permitted Affiliate - Revolving Loans and Letters of Credit)

THIS PAYMENT GUARANTY (this “Payment Guaranty”) is dated as of December 18,
2009, and is made by each entity named in the signature pages hereof (each a
“Permitted Affiliate” and collectively, the “Permitted Affiliates”), in favor of
PNC BANK, NATIONAL ASSOCIATION, as administrative agent (in such capacity,
“Administrative Agent”) for the lenders (each, a “Lender” and collectively,
“Lenders”) from time to time party to the Agreement (as hereinafter defined) and
as Swing Line Lender and L/C Issuer.  The Administrative Agent, the Lenders, the
Swing Line Lender and the L/C Issuer are sometimes hereinafter referred to
collectively as the “Guaranteed Parties” and each, individually, as a
“Guaranteed Party”.

Factual Background

A.            Essex Portfolio, L.P., a California limited partnership
(“Borrower”), Administrative Agent and the lenders party thereto entered into a
Revolving Credit Agreement dated as of December 18, 2009 (as amended from time
to time, the “Agreement”), pursuant to which such lenders agreed to make
available to Borrower an unsecured revolving line of credit and letter of credit
facility (the “Credit Line”) to Borrower on the terms and subject to the
conditions set forth therein.

B.            Each Permitted Affiliate is executing this Payment Guaranty to
induce Lenders to extend the Credit Line and enter into the Agreement.

C.            This Payment Guaranty is one of several Loan Documents, as defined
and designated in the Agreement.  The Loan Documents also include the Agreement
and certain other specified instruments and agreements.  Capitalized terms used
in this Payment Guaranty shall have the meanings set forth in Section 35 or in
the text of this Payment Guaranty and, if not defined in Section 35 or otherwise
herein, shall have the meanings given to them in the Agreement.

Guaranty

Section 1.              Guaranty of Credit Line; Limitation.

(a)           Each Permitted Affiliate hereby unconditionally and irrevocably
jointly and severally guaranties to the Guaranteed Parties, and their respective
successors, transferees and assigns, the full and prompt payment of the Credit
Line when due (whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise) and performance of the indebtedness,
liabilities and other obligations of Borrower to the Guaranteed Parties under or
in connection with the Agreement, the Notes and the other Loan Documents, and
unconditionally and irrevocably agrees to pay to Administrative Agent, for its
own account and for the account of the other Guaranteed Parties, upon the
occurrence of an Event of Default under and as defined in the Agreement, the
full amount of the Credit Line.  This is a guaranty of payment, not of
collection.  If Borrower defaults in the payment when due of all or any part of
the Credit Line, Permitted Affiliates shall in lawful money of the United States
pay to Administrative Agent or order, on demand, all sums due and owing on the
Credit Line, including all interest, charges, fees and other sums, costs and
expenses.

 
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(b)           Notwithstanding anything to the contrary contained herein, to the
extent that any Permitted Affiliate shall, under this Payment Guaranty, repay
any of the Credit Line, the liability of such Permitted Affiliate hereunder
shall be limited to an amount equal to the maximum amount of liability for
payments on the Credit Line which could be asserted against such Permitted
Affiliate hereunder without (i) rendering such Permitted Affiliate “insolvent”
within the meaning of Section 101(31) of the Bankruptcy Code, Section 2 of the
Uniform Fraudulent Transfer Act (“UFTA”) or Section 2 of the Uniform Fraudulent
Conveyance Act (“UFCA”), (ii) rendering such Permitted Affiliate no longer
Solvent, or (iii) rendering such Permitted Affiliate’s obligations hereunder
unlawful or subject to avoidance as a fraudulent transfer or conveyance under
Section 548 of the Bankruptcy Code or any comparable provisions of applicable
state law (collectively, the “Fraudulent Transfer Laws”), in each case after
giving effect to all other liabilities of such Permitted Affiliate, contingent
or otherwise, that are relevant under the Fraudulent Transfer Laws (the greatest
amount payable by such Permitted Affiliate without rendering such Permitted
Affiliate’s obligations hereunder unlawful or being subject to avoidance under
the Fraudulent Transfer Laws being at any time, the “Maximum Liability”).  To
the extent that any Permitted Affiliate shall, under this Payment Guaranty,
repay any of the Credit Line, then such Permitted Affiliate shall, subject to
the provisions of Sections 7 and 10 below, be entitled to contribution and
indemnification from, and be reimbursed by, each of the other Permitted
Affiliates with respect thereto in an amount, for each other Permitted
Affiliate, equal to a fraction of such payment, the numerator of which fraction
is such other Permitted Affiliate’s Maximum Liability as of the date of
determination and the denominator of which is the sum of the Maximum Liability
of such Permitted Affiliate and all of the other Permitted Affiliates as of the
date of determination.

Section 2.              Credit Line.  In this Payment Guaranty, the term “Credit
Line” is broadly defined to mean and include all primary, secondary, direct,
indirect, fixed and contingent obligations of Borrower to pay principal,
interest, prepayment charges, late charges, loan fees and any other fees,
charges, sums, costs and expenses which may be owing at any time under the Loan
Documents, as any or all of them may from time to time be modified, amended,
extended or renewed, including all unpaid principal of the Loans, all amounts
owing in respect of the L/C Obligations, all interest accrued thereon, all
indemnification obligations of Borrower under or in connection with the
Agreement, the Notes and the other Loan Documents, and all other amounts payable
by Borrower to the Guaranteed Parties thereunder or in connection therewith,
including all such amounts that may be or hereafter become unenforceable or be
or hereafter become an allowed or disallowed claim under any Insolvency
Proceeding, and including interest that accrues after the commencement by or
against Borrower or any Affiliate thereof under any Insolvency Proceeding naming
such Person as the debtor in such proceeding.  For purposes of this Payment
Guaranty, the Credit Line includes all such obligations which may arise in
connection with any transactions between Borrower and Lenders which may afford
interest rate protection to all or part of the Credit Line, if any, and all
other indebtedness, liabilities and obligations to be paid or performed by
Permitted Affiliates in connection with this Payment Guaranty (including any and
all amounts due under Section 22).

 
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Section 3.              Rights of Administrative Agent and the other Guaranteed
Parties.  Each Permitted Affiliate authorizes Administrative Agent and/or the
other Guaranteed Parties to perform any or all of the following acts at any time
in its sole discretion, all without notice to any Permitted Affiliate and
without affecting any Permitted Affiliate’s obligations under this Payment
Guaranty:

(a)            alter any terms of the Credit Line or any part of it, including
renewing, compromising, extending or accelerating, or otherwise changing the
time for payment of, or increasing or decreasing the rate of interest on, the
Credit Line or any part of it;

(b)            take and hold security for the Credit Line or this Payment
Guaranty, accept additional or substituted security for either, and subordinate,
exchange, enforce, waive, release, compromise, fail to perfect and sell or
otherwise dispose of any such security;

(c)            direct the order and manner of any sale of all or any part of any
security now or later to be held for the Credit Line or this Payment Guaranty,
and Administrative Agent or any other Guaranteed Party may also bid at any such
sale;

(d)            apply any payments or recoveries from Borrower, any Permitted
Affiliate, any other guarantor or any other source, and any proceeds of any
security, to Borrower’s obligations under the Loan Documents in such manner,
order and priority as Administrative Agent may elect whether or not those
obligations are guarantied by this Payment Guaranty or secured at the time of
the application;

(e)            release Borrower of its liability for the Credit Line or any part
of it;

(f)            substitute, add or release any one or more guarantors or
endorsers; or

(g)            in addition to the Credit Line, extend other credit to Borrower,
and may take and hold security for the credit so extended, all without affecting
any Permitted Affiliate’s liability under this Payment Guaranty.

Section 4.              Guaranty to be Absolute.  Each Permitted Affiliate
expressly agrees that until the Credit Line is paid and performed in full and
each and every term, covenant and condition of this Payment Guaranty is fully
performed, none of the Permitted Affiliates shall be released by or because of:

(a)            any act or event that might otherwise discharge, reduce, limit or
modify any Permitted Affiliate’s obligations under this Payment Guaranty;

(b)            any waiver, extension, modification, forbearance, delay or other
act or omission of Administrative Agent or any other Guaranteed Party, or its
failure to proceed promptly or otherwise as against Borrower, any Permitted
Affiliate, any other guarantor or any security;

(c)            any action, omission or circumstance which might increase the
likelihood that any Permitted Affiliate may be called upon to perform under this
Payment Guaranty or which might affect the rights or remedies of any Permitted
Affiliate as against Borrower or any other Person;

 
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(d)            any dealings occurring at any time between Borrower,
Administrative Agent or any other Guaranteed Party, whether relating to the
Credit Line or otherwise; or

(e)            any action of Administrative Agent or any other Guaranteed Party
described in Section 3.

Each Permitted Affiliate hereby acknowledges that absent this Section 4, each
Permitted Affiliate might have a defense to the enforcement of this Payment
Guaranty as a result of one or more of the foregoing acts, omissions,
agreements, waivers or matters.  Each Permitted Affiliate hereby expressly
waives and surrenders any defense to any liability under this Payment Guaranty
based upon any of such acts, omissions, agreements, waivers or matters.

Section 5.              Liability of Permitted Affiliates.  Each Permitted
Affiliate’s obligations under this Payment Guaranty are and shall be
independent, absolute, unconditional and irrevocable, and shall not be affected
by any circumstance which might constitute a discharge of a surety or guarantor,
other than the indefeasible payment and performance in full of the Credit
Line.  Each Permitted Affiliate’s liability with respect to the Credit Line
shall remain in full force and effect without regard to, and shall not be
impaired or affected by, any Insolvency Proceeding with respect to Borrower, any
Permitted Affiliate or any other Person, or any assignment or other transfer of
any Guaranteed Party’s interests in and rights under this Payment Guaranty or
the other Loan Documents, or any claim, defense, counterclaim or setoff (other
than that of prior performance), that Borrower, any Permitted Affiliate or any
other Person may have or assert; or any amendment, modification, renewal,
extension, cancellation or surrender of any Loan Document or any collateral that
may at any time secure the Credit Line, or any Guaranteed Party’s exchange,
release, or waiver of any other guaranty of all or any part of the Credit Line
or any other indebtedness, obligations or liabilities of Borrower or any other
guarantor to any Guaranteed Party under the Credit Line.

Section 6.               Permitted Affiliate’s Waivers.  Each Permitted
Affiliate waives:

(a)           all statutes of limitations as a defense to any action or
proceeding brought against any Permitted Affiliate by Administrative Agent, to
the fullest extent permitted by law;

(b)           any right it may have to require Administrative Agent or any other
Guaranteed Party to proceed against Borrower, proceed against or exhaust any
security held from Borrower, or pursue any other remedy in Administrative
Agent’s or any other Guaranteed Party’s power to pursue;

(c)           any defense based on any claim that any Permitted Affiliate’s
obligations exceed or are more burdensome than those of Borrower;

(d)           any defense based on: (i) any legal disability of Borrower, (ii)
any release, discharge, modification, impairment or limitation of the liability
of Borrower to Administrative Agent or any other Guaranteed Party from any
cause, whether consented to by Administrative Agent or any other Guaranteed
Party or arising by operation of law or from any Insolvency Proceeding, and
(iii) any rejection or disaffirmance of the Credit Line, or any part of it, or
any security held for it, in any such Insolvency Proceeding;

 
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(e)           any defense based on any action taken or omitted by Administrative
Agent or any other Guaranteed Party in any Insolvency Proceeding involving
Borrower, including any election to have Administrative Agent’s or any other
Guaranteed Party’s claim allowed as being secured, partially secured or
unsecured, any extension of credit by Lenders to Borrower in any Insolvency
Proceeding, and the taking and holding by Administrative Agent or the other
Guaranteed Parties of any security for any such extension of credit;

(f)           all presentments, demands for performance, notices of
nonperformance, protests, notices of protest, notices of dishonor, notices of
acceptance of this Payment Guaranty and of the existence, creation, or incurring
of new or additional indebtedness, and demands and notices of every kind except
for any demand or notice by Administrative Agent to such Permitted Affiliate
expressly provided for in Section 1:

(g)           any defense based on or arising out of any defense that Borrower
may have to the payment or performance of the Credit Line or any part of it; and

(h)           any defense based on or arising out of any action of
Administrative Agent or any Lender described in Section 3 or Section 4.

Section 7.               Waivers of Subrogation and Other Rights and Defenses.

(a)           (Upon a default by Borrower, Administrative Agent and/or any other
Guaranteed Party in their sole discretion, without prior notice to or consent of
any Permitted Affiliate, may elect to: (i) foreclose either judicially or
nonjudicially against any real or personal property security they may hold for
the Credit Line, (ii) accept a transfer of any such security in lieu of
foreclosure, (iii) compromise or adjust the Credit Line or any part of it or
make any other accommodation with Borrower, any Permitted Affiliate or any other
guarantor, or (iv) exercise any other remedy against Borrower or any
security.  No such action by Administrative Agent and/or any other Guaranteed
Party shall release or limit the liability of any Permitted Affiliate, who shall
remain liable under this Payment Guaranty after the action, even if the effect
of the action is to deprive such Permitted Affiliate of any subrogation rights,
rights of indemnity, or other rights to collect reimbursement from Borrower for
any sums paid to Administrative Agent for its own account or for the account of
any other Guaranteed Party, whether contractual or arising by operation of law
or otherwise.  Each Permitted Affiliate expressly agrees that under no
circumstances shall it be deemed to have any right, title, interest or claim in
or to any real or personal property to be held by Administrative Agent or any
other Guaranteed Party or any third party after any foreclosure or transfer in
lieu of foreclosure of any security for the Credit Line.

(b)           Regardless of whether any Permitted Affiliate may have made any
payments to Administrative Agent for its own account or for the account of any
other Guaranteed Party, each Permitted Affiliate waives, until all indebtedness,
liabilities and other obligations of Borrower to the Guaranteed Parties under or
in connection with the Agreement, the Notes and the other Loan Documents have
been indefeasibly paid in full: (i) all rights of subrogation, all rights of
indemnity, and any other rights to collect reimbursement from Borrower, any
other Permitted Affiliate or any other guarantor for any sums paid to
Administrative Agent or any other Guaranteed Party, whether contractual or
arising by operation of law (including the United States Bankruptcy Code or any
successor or similar statute) or otherwise, (ii) all rights to participate in
any security now or later to be held by Administrative Agent or the other
Guaranteed Parties for the Credit Line, and (iii) all rights to enforce any
remedy that Administrative Agent or any other Guaranteed Party may have against
Borrower, any other Permitted Affiliate or any other guarantor.

 
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(c)           Each Permitted Affiliate waives such Permitted Affiliate’s rights
of subrogation and reimbursement and any other rights and defenses available to
such Permitted Affiliate by reason of Sections 2787 to 2855, inclusive, of the
California Civil Code including, without limitation, any defenses such Permitted
Affiliate may have to the Payment Guaranty obligation by reason of an election
of remedies by Administrative Agent or any other Guaranteed Party, and any and
all benefits that otherwise might be available to such Permitted Affiliate under
California Civil Code §§1432, 2809, 2810, 2815, 2819, 2839, 2845, 2848, 2849,
2850, 2899 and 3433 and California Code of Civil Procedure §§580a, 580b, 580d
and 726.  Accordingly, each Permitted Affiliate waives all rights and defenses
that such Permitted Affiliate may have because Borrower’s debt may at any time
be secured by real property.  This means, among other things: (A) the Guaranteed
Parties may collect from such Permitted Affiliate without first foreclosing on
any real or personal property collateral that may at any time be pledged by
Borrower; and (B) if the Administrative Agent forecloses on any real property
collateral that may at any time be pledged by Borrower: (1) the amount of the
debt may be reduced only by the price for which such collateral is sold at the
foreclosure sale, even if such collateral is worth more than the sale price, and
(2) the Guaranteed Parties may collect from such Permitted Affiliate even if the
Administrative Agent, by foreclosing on such real property collateral, has
destroyed any right such Permitted Affiliate may have to collect from
Borrower.  This is an unconditional and irrevocable waiver of any rights and
defenses any Permitted Affiliate may have because Borrower’s debt may at any
time be secured by real property.  These rights and defenses include, but are
not limited to, any rights of defenses based upon Section 580a, 580b, 580d or
726 of the California Code of Civil Procedure.

(d)           Each Permitted Affiliate waives all right and defenses arising out
of an election of remedies by Administrative Agent or the other Guaranteed
Parties, even though that election of remedies has destroyed such Permitted
Affiliate’s rights of subrogation and reimbursement against Borrower.

(e)           No provision or waiver in this Payment Guaranty shall be construed
as limiting the generality of any other waiver contained in this Payment
Guaranty.

Section 8.              Continuing Guaranty; Reinstatement.  This Guaranty is a
continuing guaranty and agreement of subordination relating to any Guaranteed
Obligations, including Guaranteed Obligations which may exist continuously or
which may arise from time to time under successive transactions, and each
Permitted Affiliate expressly acknowledge that this Payment Guaranty shall
remain in full force and effect notwithstanding that there may be periods in
which no Guaranteed Obligations exist.  This Guaranty shall continue in effect
and be binding upon each Permitted Affiliate until termination of the
Commitments and payment and performance in full of the Guaranteed
Obligations.  This Guaranty shall continue to be effective or shall be
reinstated and revived, as the case may be, if, for any reason, any payment of
the Guaranteed Obligations by or on behalf of Borrower (or receipt of any
proceeds of Collateral) shall be rescinded, invalidated, declared to be
fraudulent or preferential, set aside, voided or otherwise required to be repaid
to Borrower, its estate, trustee, receiver or any other Person (including under
the Bankruptcy Code or other state or federal law), or must otherwise be
restored by any Guaranteed Party, whether as a result of Insolvency Proceedings
or otherwise.  To the extent any payment is so rescinded, set aside, voided or
otherwise repaid or restored, the Guaranteed Obligations shall be revived in
full force and effect without reduction or discharge for such payment.

 
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Section 9.              Information Regarding Borrower and the Property.  Before
signing this Payment Guaranty, each Permitted Affiliate investigated the
financial condition and business operations of Borrower, the present and former
condition, uses and ownership of the Unencumbered Asset Pool, and such other
matters as each Permitted Affiliate deemed appropriate to assure itself of
Borrower’s ability to discharge its obligations under the Loan Documents.  Each
Permitted Affiliate assumes full responsibility for that due diligence, as well
as for keeping informed of all matters which may affect Borrower’s ability to
pay and perform its obligations to Administrative Agent and the other Guaranteed
Parties.  Neither Administrative Agent nor any Lender has a duty to disclose to
any Permitted Affiliate any information that Administrative Agent or any Lender
may have or receive about Borrower’s financial condition or business operations,
or any other circumstances bearing on Borrower’s ability to perform.

Section 10.            Subordination.  Any rights of any Permitted Affiliate,
whether now existing or later arising, to receive payment on account of any
indebtedness (including interest) owed to it by Borrower or any other Permitted
Affiliate, or to withdraw capital invested by it in Borrower or any other
Permitted Affiliate, or to receive distributions from Borrower or any other
Permitted Affiliate, shall at all times be subordinate as to lien and time of
payment and in all other respects to the full and prior repayment to
Administrative Agent and the other Guaranteed Parties of the Credit Line.  After
and during the continuation of an Event of Default, each Permitted Affiliate
shall not be entitled to enforce or receive payment of any sums hereby
subordinated until the Credit Line has been paid and performed in full and any
such sums received in violation of this Payment Guaranty shall be received by
such Permitted Affiliate in trust for Administrative Agent and the other
Guaranteed Parties.  The foregoing notwithstanding, as long as no Event of
Default is continuing, the Permitted Affiliates may from receive such reasonable
management fees or reasonable salary from Borrower as Administrative Agent may
find reasonably acceptable from time to time and may receive from Borrower and
retain any other amounts that are not prohibited by the terms of the Agreement.

Section 11.            Permitted Affiliates’ Representations and
Warranties.  Each Permitted Affiliate represents and warrants that:

(a)           Financial Statements True and Correct.  All financial information
furnished or to be furnished to Administrative Agent regarding such Permitted
Affiliate are or will be true and correct in all material respects determined
according to GAAP unless otherwise provided for herein and do or will fairly
represent the financial condition of such Permitted Affiliate (including all
contingent liabilities) (for purposes of this Section 11(a), the term “material
respects” means any variance in the aggregate amount of $10,000,000.00);

 
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(b)           No Material Adverse Change.  There has been no material adverse
change in any Permitted Affiliate’s financial condition since the dates of the
statements most recently furnished to Administrative Agent;

(c)           Organization of Permitted Affiliate.  Each Permitted Affiliate is
a corporation, partnership, or limited liability company duly organized or
formed, validly existing and in good standing under the laws of the jurisdiction
of its incorporation or organization;

(d)           Authorization.  The execution and compliance with this Payment
Guaranty, the Agreement, and the other Loan Documents to which any Permitted
Affiliate is a party are within such Permitted Affiliate’s powers, have been
duly authorized, and do not conflict with any of such Permitted Affiliate’s
organizational documents;

(e)           Enforceable Agreement.  This Payment Guaranty is a legal, valid
and binding agreement of each Permitted Affiliate, enforceable against such
Permitted Affiliate in accordance with its terms, and any other Loan Document to
which such Permitted Affiliate is a party, when executed and delivered, will be
similarly legal, valid, binding and enforceable, except to the extent that the
enforcement of the rights and remedies of Administrative Agent or the other
Guaranteed Parties may hereafter be subject to bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting generally the enforcement
of creditors’ rights and remedies, and the availability of equitable remedies
may be subject to the discretion of the court before which any proceeding
thereof is brought;

(f)           Good Standing.  In each state in which each Permitted Affiliate
does business, such Permitted Affiliate is, where required, properly licensed,
in good standing and in compliance with fictitious name statutes;

(g)           No Conflicts.  Each Permitted Affiliate, to the best of such
Permitted Affiliate’s knowledge, is not in violation of, nor do the terms of
this Payment Guaranty or any other Loan Document conflict with, any law
(including Environmental Laws), regulation or ordinance, any order of any court
or governmental entity, or any covenant or agreement affecting any Permitted
Affiliate which would materially and adversely affect such Permitted Affiliate’s
ability to perform its obligations under this Payment Guaranty or under any
other Loan Document to which such Permitted Affiliate is a party;

(h)           Lawsuits.  There is no lawsuit, tax claim or other dispute pending
or threatened against any Permitted Affiliate which, if lost, would materially
adversely impair such Permitted Affiliate’s financial condition or ability to
repay the Credit Line;

(i)            Other Obligations.  Each Permitted Affiliate is not in material
default (taking into account all applicable cure periods, if any) on any
material obligation for borrowed money, any purchase money obligation or any
other material lease, commitment, contract, instrument or obligation;

(j)            No Required Third Party/Governmental Approvals.  No approval,
consent, exemption, authorization, or other action by, or notice to, or tiling
with any third party or any Governmental Authority, is necessary or required in
connection with the execution, delivery or performance of this Payment Guaranty
or any other Loan Document to which any Permitted Affiliate is a party; and

 
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(k)           Solvency.  Immediately prior to and after and giving effect to the
incurrence of the Permitted Affiliates’ obligations under this Payment Guaranty
each Permitted Affiliate is and will be Solvent.  “Solvent” shall mean that (i)
the fair value of such Permitted Affiliate’s assets is greater than the amount
of such Permitted Affiliate’s liabilities as such value is established and
liabilities evaluated for purposes of Section 101(32) of the Bankruptcy Code
and, in the alternative, for purposes of the California Uniform Fraudulent
Transfer Act and any other applicable fraudulent conveyance statute; (ii) the
present fair saleable value of such Permitted Affiliate’s assets is not less
than the amount that will be required to pay the probable liability of such
Permitted Affiliate on its debts as they become absolute and matured; (iii) such
Permitted Affiliate is able to realize upon its assets and pay its debts and
other liabilities as they mature in the normal course of business; (iv) such
Permitted Affiliate does not intend to, and does not believe that it will, incur
debts or liabilities beyond such Permitted Affiliate’s ability to pay as such
debts and liabilities mature; and (v) such Permitted Affiliate is not engaged in
business or a transaction, and is not about to engage in business or a
transaction, for which such Permitted Affiliate’s property would constitute
unreasonably small capital.

Section 12.             Affirmative Covenant.  Each Permitted Affiliate promises
to keep the following covenant:

(a)           Compliance with Law.  Each Permitted Affiliate shall comply with
all existing and future laws (including Environmental Laws), regulations,
orders, building restrictions and requirements of, and all agreements with and
commitments to, all Governmental Authorities having jurisdiction over such
Permitted Affiliate or such Permitted Affiliate’s business, as applicable,
including those pertaining to the construction, sale, leasing or financing of
any Unencumbered Asset Pool Property or the environmental condition of any
Unencumbered Asset Pool Property, and with all recorded covenants and
restrictions affecting any Unencumbered Asset Pool Property (all collectively,
the “Requirements”).  Notwithstanding any contrary provision in this Section,
(i) each Permitted Affiliate shall have a right to contest all existing and
future Requirements of Law (other than those relating to Environmental Laws)
before complying therewith, and (ii) each Permitted Affiliate shall have a right
to contest all existing and future Requirements relating to Environmental Laws
for one year, before complying therewith, provide that no Unencumbered Asset
Pool Property is in danger of being lost or forfeited.

(b)           Agreement Covenants.  Each Permitted Affiliate shall observe,
perform and comply with all covenants expressly applicable to such Permitted
Affiliate set forth in Articles 4, 6 and 10 of the Agreement, which by their
terms Borrower is required to cause such Permitted Affiliate to observe, perform
and comply with, as if such covenants were set forth in full herein.

Section 13.           Negative Covenants.  Without Administrative Agent’s prior
written consent, which consent shall not be unreasonably withheld or delayed, no
Permitted Affiliate’s jurisdiction of formation, place of business, or chief
executive office (if such Permitted Affiliate has more than one place of
business) shall change, except upon thirty (30) days’ prior written notice to
Administrative Agent.

 
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Section 14.             Governing Law; Jurisdiction and Dispute Resolution.

(i)            GOVERNING LAW.  THIS PAYMENT GUARANTY IS TO BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF CALIFORNIA (AS
PERMITTED BY SECTION 1646.5 OF THE CALIFORNIA CIVIL CODE OR ANY SIMILAR
SUCCESSOR PROVISION), WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW RULE THAT WOULD
CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE INTERNAL
LAWS OF THE STATE OF CALIFORNIA TO THE RIGHTS AND DUTIES OF THE PARTIES.

(ii)            SUBMISSION TO JURISDICTION.  EACH PERMITTED AFFILIATE AND, BY
ITS ACCEPTANCE OF THIS GUARANTY, THE ADMINISTRATIVE AGENT, EACH IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE
JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA SITTING IN SAN FRANCISCO
COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE NORTHERN DISTRICT OF
CALIFORNIA, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS PAYMENT GUARANTY OR ANY OTHER LOAN
DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH PERMITTED
AFFILIATE AND EACH GUARANTEED PARTY (BY ITS ACCEPTANCE OF THIS PAYMENT GUARANTY)
IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH
ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH CALIFORNIA STATE COURT
OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT,
AND EACH PERMITTED AFFILIATE AND EACH GUARANTEED PARTY (BY ITS ACCEPTANCE OF
THIS PAYMENT GUARANTY) AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.  NOTHING IN THIS
PAYMENT GUARANTY OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT ANY
GUARANTEED PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING
TO THIS PAYMENT GUARANTY OR ANY OTHER LOAN DOCUMENT AGAINST ANY PERMITTED
AFFILIATE OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION WHERE SUCH
PERMITTED AFFILIATE OR ITS PROPERTIES ARE LOCATED.

(iii)           WAIVER OF VENUE.  EACH PERMITTED AFFILIATE AND, BY ITS
ACCEPTANCE OF THIS GUARANTY, THE ADMINISTRATIVE AGENT, IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS PAYMENT GUARANTY OR ANY OTHER
LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (i) OF THIS SECTION.  EACH
PERMITTED AFFILIATE AND EACH GUARANTEED PARTY (BY ITS ACCEPTANCE OF THIS PAYMENT
GUARANTY) IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.

 
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(iv)           SERVICE OF PROCESS.  EACH PERMITTED AFFILIATE IRREVOCABLY
CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION
20.  NOTHING IN THIS PAYMENT GUARANTY WILL AFFECT THE RIGHT OF ANY GUARANTEED
PARTY TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

(v)           WAIVER OF JURY TRIAL.  EACH PERMITTED AFFILIATE AND EACH
GUARANTEED PARTY (BY ITS ACCEPTANCE HEREOF) IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
PAYMENT GUARANTY OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH
PERMITTED AFFILIATE AND EACH GUARANTEED PARTY (BY ITS ACCEPTANCE HEREOF) (i)
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (ii) ACKNOWLEDGES
THAT IT HAVE BEEN INDUCED TO ENTER INTO THIS PAYMENT GUARANTY AND THE OTHER LOAN
DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.

(vi)           Judicial Reference.  If any action or proceeding by or against
any party hereto in connection with any of the transactions contemplated by this
Payment Guaranty or any other Loan Document is filed in a forum in which
predispute waivers of the right to a trial by jury are invalid under applicable
law, (a) the court shall, and is hereby directed to, make a general reference
pursuant to California Code of Civil Procedure Section 638 (or similar
applicable law) to a referee (who shall be a single active or retired judge) to
hear and determine all of the issues in such action or proceeding (whether of
fact or of law) and to report a statement of decision, provided that at the
option of any party to such proceeding, any such issues pertaining to a
“provisional remedy” (or similar term) as defined in California Code of Civil
Procedure Section 1281.8 (or similar applicable law) shall be heard and
determined by the court, and (b) the prevailing party, or the non-dismissing
party in the event of a voluntary dismissal by the party instituting the action,
shall be entitled to the full amount of all fees and expenses of any referee
appointed in such action or proceeding.

Section 15.             Authorization; No Violation.  Each Permitted Affiliate
is authorized to execute, deliver and perform under this Payment Guaranty, which
is a valid and binding obligation of such Permitted Affiliate, except as the
same may be limited by insolvency, bankruptcy, reorganization, or other laws
relating to or affecting the enforcement of creditors’ rights or by general
equitable principles.  No provision or obligation of any Permitted Affiliate
contained in this Payment Guaranty violates any applicable law, regulation or
ordinance, or any order or ruling of any court or governmental agency.  No such
provision or obligation conflicts with, or constitutes a breach or default
under, any agreement to which such Permitted Affiliate is a party.  No consent,
approval or authorization of or notice to any person or entity is required in
connection with such Permitted Affiliate’s execution of and obligations under
this Payment Guaranty.

 
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Section 16.            Additional and Independent Obligations.  Each Permitted
Affiliate’s obligations under this Payment Guaranty are in addition to its
obligations under any other existing or future guaranties, each of which shall
remain in full force and effect until it is expressly modified or released in a
writing signed by Administrative Agent in accordance with the terms of the
Agreement.  Each Permitted Affiliate’s obligations under this Payment Guaranty
are joint and several, and are independent of those of each other Permitted
Affiliate, each other guarantor and Borrower on the Credit Line.  Administrative
Agent or any other Guaranteed Party may bring a separate action, or commence a
separate reference or arbitration proceeding against any Permitted Affiliate
without first proceeding against Borrower, any other Permitted Affiliate, any
other guarantor, any other Person or any security that Administrative Agent or
any other Guaranteed Party may hold, and without pursuing any other
remedy.  Administrative Agent’s rights under this Payment Guaranty shall not be
exhausted by any action by Administrative Agent until the Credit Line has been
paid and performed in full.

Section 17.            No Waiver; Consents; Cumulative Remedies.  Each waiver by
Administrative Agent must be in writing, and no waiver shall be construed as a
continuing waiver.  No waiver shall be implied from Administrative Agent’s or
any other Guaranteed Party’s delay in exercising or failure to exercise any
right or remedy against Borrower, any Permitted Affiliate, any other guarantor
or any security.  Consent by Administrative Agent or the other Guaranteed
Parties to any act or omission by Borrower, any Permitted Affiliate, any other
guarantor or any other Person shall not be construed as a consent to any other
or subsequent act or omission, or as a waiver of the requirement for
Administrative Agent’s or the other Guaranteed Parties’ consent to be obtained
in any future or other instance.  All remedies of Administrative Agent or the
other Guaranteed Parties against Borrower, each Permitted Affiliate and each
other guarantor are cumulative.

Section 18.            No Release.  Each Permitted Affiliate shall not be
released from its obligations under this Payment Guaranty except by a writing
signed by Administrative Agent in accordance with the terms of the Agreement.

Section 19.            Heirs, Successors and Assigns; Participations.  The terms
of this Payment Guaranty shall bind and benefit the heirs, legal
representatives, successors and assigns of Administrative Agent, each Guaranteed
Party and each Permitted Affiliate; provided, however, that no Permitted
Affiliate may assign this Payment Guaranty, or assign or delegate any of its
rights or obligations under this Payment Guaranty, without the prior written
consent of Administrative Agent in accordance with the terms of the
Agreement.  Each Lender shall have the right to transfer its Commitment and its
outstanding Loans to any other Person on the terms and subject to the conditions
set forth in Section 10.5 of the Agreement.  Without the consent of or notice to
any Permitted Affiliate, Administrative Agent and the other Guaranteed Parties
may disclose to any prospective or actual purchasers of any interest in any Loan
or any other loans made by Lenders to Borrower (in the case of a prospective
purchase of an interest in the Loans or any other loan, upon Lender’s receiving
its standard confidentiality letter from the prospective purchaser of the
interest in the Loan or any other loan), any financial or other information
relating to any Permitted Affiliate, this Payment Guaranty or any security that
may at any time be given for this Payment Guaranty.

 
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Section 20.            Notices.  All notices and other communications provided
for herein shall be in writing and shall be delivered by hand or overnight
courier service, mailed by certified or registered mail or sent by telecopier,
in the case of any Permitted Affiliate, to the address or telecopier number
specified on the signature page hereof, and in the case of the Administrative
Agent, the L/C Issuer and the Lenders, to the addresses or telecopier numbers
specified in the Agreement.  Notices sent by hand or overnight courier service,
or mailed by certified or registered mail, shall be deemed to have been given
when received; notices sent by telecopier shall be deemed to have been given
when sent (except that, if not given during normal business hours for the
recipient, shall be deemed to have been given at the opening of business on the
next business day for the recipient).  Each of the Permitted Affiliates and the
Guaranteed Parties may change its address or telecopier number for notices and
other communications hereunder by notice to the other parties.

Section 21.            Rules of Construction.  In this Payment Guaranty, the
word “Borrower” includes each of the named Borrower, each other Loan Party and
any other person who at any time assumes or otherwise becomes primarily liable
for all or any part of the obligations of the named Borrower on the Credit
Line.  The word “person” includes any individual, company, trust or other legal
entity of any kind.  The word “include(s)” means “include(s), without
limitation,” and the word “including” means “including, but not limited to.”
When the context and construction so require, all words used in the singular
shall be deemed to have been used in the plural and vice versa.  No listing of
specific instances, items or matters in any way limits the scope or generality
of any language of this Payment Guaranty.  All headings appearing in this
Payment Guaranty are for convenience only and shall be disregarded in construing
this Payment Guaranty.  The rules of interpretation set forth in Section 1.2 of
the Agreement shall be applicable to this Payment Guaranty and are incorporated
herein by this reference.

Section 22.            Costs and Expenses; Indemnification.

(i)            Costs and Expenses.  Each Permitted Affiliate shall pay (i) all
reasonable out-of-pocket expenses incurred by the Administrative Agent and its
Affiliates (including the reasonable fees, charges and disbursements of counsel
for the Administrative Agent), in connection with the preparation, negotiation,
execution and delivery of this Payment Guaranty and the other Guarantor
Documents or any amendments, modifications or waivers of the provisions hereof
or thereof (whether or not the transactions contemplated hereby or thereby shall
be consummated), and (ii) all out-of-pocket expenses incurred by the
Administrative Agent or any other Guaranteed Party (including the fees, charges
and disbursements of any counsel for any Guaranteed Party) in connection with
the enforcement or protection of its rights in connection with this Payment
Guaranty and the other Loan Documents, including its rights under this Section,
including all such out-of-pocket expenses incurred during any workout,
restructuring or negotiations in respect of the Guaranteed Obligations.

 
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(ii)            Indemnification.  Each Permitted Affiliate shall indemnify the
Administrative Agent (and any sub-agent thereof), each other Guaranteed Party,
and each Related Party of any of the foregoing Persons (each such Person being
called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and
all losses, claims, damages, liabilities and related expenses (including the
fees, charges and disbursements of any counsel for any Indemnitee) incurred by
any Indemnitee or asserted against any Indemnitee by any third party or by any
Permitted Affiliate or any other Loan Party arising out of, in connection with,
or as a result of (i) the execution or delivery of this Payment Guaranty or any
other Loan Document or any agreement or instrument contemplated hereby or
thereby, the performance by the parties hereto or thereto of their respective
obligations hereunder or thereunder or the consummation of the transactions
contemplated hereby or thereby, (ii) any Loan or Letter of Credit or the use or
proposed use of the proceeds therefrom (including any refusal by the L/C Issuer
to honor a demand for payment under a Letter of Credit if the documents
presented in connection with such demand do not strictly comply with the terms
of such Letter of Credit), (iii) any actual or alleged presence or release of
Hazardous Materials on or from any property owned or operated by Borrower, any
Permitted Affiliates or any of its Subsidiaries, or any Environmental Liability
related in any way to Borrower, any Permitted Affiliate or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether based on contract, tort
or any other theory, whether brought by a third party or by Borrower or any
other Loan Party, and regardless of whether any Indemnitee is a party thereto;
provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that such losses, claims, damages, liabilities or related expenses
(x) are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnitee or (y) result from a claim brought by Borrower or
any other Loan Party against an Indemnitee for breach in bad faith of such
Indemnitee’s obligations hereunder or under any other Loan Document, if Borrower
or such other Loan Party has obtained a final and nonappealable judgment in its
favor on such claim as determined by a court of competent jurisdiction.

(iii)           Interest.  Any amounts payable to by any Permitted Affiliate
under this Section 22 or otherwise under this Payment Guaranty if not paid upon
demand shall bear interest from the date of such demand until paid in full, at a
fluctuating interest rate per annum at all times equal to the Reference Rate
applicable to Reference Rate Committed Loans to the fullest extent permitted by
applicable Law.  Any such interest shall be due and payable upon demand and
shall be calculated on the basis of a year of 365 or 366 days, as the case may
be, and the actual number of days elapsed.

(iv)           Payment.  All amounts due under this Section 22 shall be payable
within fifteen days after demand therefor.

(v)           Survival.  The agreements in this Section 22 shall survive the
resignation of the Administrative Agent and the L/C Issuer, the replacement of
any Lender, the termination of the Commitments and the repayment, satisfaction
or discharge of all the other Guaranteed Obligations.

Section 23.            Consideration.  Each Permitted Affiliate acknowledges
that it expects to benefit from Lenders’ extension of the Credit Line to
Borrower because of its relationship to Borrower, and that it is executing this
Payment Guaranty in consideration of that anticipated benefit.

 
F-2-14

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Section 24.             Payments.

(a)            Each Permitted Affiliate hereby agrees, in furtherance of the
foregoing provisions of this Payment Guaranty and not in limitation of any other
right which any Guaranteed Party or any other Person may have against any
Permitted Affiliate by virtue hereof, upon the failure of Borrower to pay any of
the Guaranteed Obligations when and as the same shall become due, whether at
stated maturity, by required prepayment, declaration, acceleration, demand or
otherwise (including amounts that would become due but for the operation of the
automatic stay under §362(a) of the Bankruptcy Code), such Permitted Affiliate
shall forthwith pay, or cause to be paid, in cash, to the Administrative Agent
an amount equal to the amount of the Guaranteed Obligations then due as
aforesaid (including interest which, but for the filing of a petition in any
Insolvency Proceeding with respect to Borrower, would have accrued on such
Guaranteed Obligations, whether or not a claim is allowed against Borrower for
such interest in any such Insolvency Proceeding).  Each Permitted Affiliate
shall make each payment hereunder, unconditionally in full without set-off,
counterclaim or other defense, on the day when due in Dollars, in immediately
available funds, to the Administrative Agent at such office of the
Administrative Agent and to such account as the Administrative Agent shall
specify in writing to the Permitted Affiliates.

(b)            Any and all payments by or on account of any Guaranteed
Obligation hereunder or under any other Guarantor Document shall be made free
and clear of and without reduction or withholding for any Indemnified Taxes or
Other Taxes, provided that if any Permitted Affiliate shall be required by
applicable law to deduct any Indemnified Taxes (including any Other Taxes) from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Guaranteed Party receives an
amount equal to the sum it would have received had no such deductions been made,
(ii) such Permitted Affiliate shall make such deductions and (iii) such
Permitted Affiliate shall timely pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.

(c)            Without limiting the provisions of paragraph (b) above, each
Permitted Affiliate shall timely pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.

(d)            Each Permitted Affiliate shall indemnify the Guaranteed Parties,
within fifteen days after demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes
imposed or asserted on or attributable to amounts payable under this Section)
paid by the Guaranteed Parties and any penalties, interest and reasonable
expenses arising therefrom or with respect thereto, whether or not such
Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted
by the relevant Governmental Authority.  A certificate as to the amount of such
payment or liability delivered to any Permitted Affiliate by a Guaranteed Party
(with a copy to the Administrative Agent), or by the Administrative Agent on its
own behalf or on behalf of another Guaranteed Party, shall be conclusive absent
manifest error.

 
F-2-15

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(e)            As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by any Permitted Affiliate to a Governmental Authority, such
Permitted Affiliate shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.

(f)            Any payments by any Permitted Affiliate hereunder the application
of which is not otherwise provided for herein, shall be applied in the order
specified in Section 8.3 of the Credit Agreement.

(g)            To the extent that any payment by or on behalf of Borrower is
made to the Administrative Agent or any other Guaranteed Party, or the
Administrative Agent or any other Guaranteed Party exercises its right of
setoff, and such payment or the proceeds of such setoff or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required (including pursuant to any settlement entered into by the
Administrative Agent or any other Guaranteed Party in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Insolvency Proceeding or otherwise, then (i) to the extent
of such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred, and (ii) each Lender
and the L/C Issuer severally (by its acceptance hereof) agrees to pay to the
Administrative Agent upon demand its applicable share (without duplication) of
any amount so recovered from or repaid by the Administrative Agent, plus
interest thereon from the date of such demand to the date such payment is made
at a rate per annum equal to the Federal Funds Rate from time to time in
effect.  The obligations of the Lenders and the L/C Issuer under clause (ii) of
the preceding sentence shall survive the payment in full of the Guaranteed
Obligations and the termination of this Payment Guaranty.

(h)            Notwithstanding anything to the contrary contained herein or in
Guarantor Document, the interest paid or agreed to be paid hereunder and under
the other Guarantor Documents shall not exceed the maximum rate of non-usurious
interest permitted by applicable Law (the “Maximum Rate”).  If the
Administrative Agent or any other Guaranteed Party shall receive interest in an
amount that exceeds the Maximum Rate, the excess interest shall be applied to
the principal of the Guaranteed Obligations or, if it exceeds such unpaid
principal, refunded to such Permitted Affiliate.  In determining whether the
interest contracted for, charged, or received by the Administrative Agent or any
other Guaranteed Party exceeds the Maximum Rate, such Person may, to the extent
permitted by applicable Law, (i) characterize any payment that is not principal
as an expense, fee, or premium rather than interest, (ii) exclude voluntary
prepayments and the effects thereof, and (iii) amortize, prorate, allocate, and
spread in equal or unequal parts the total amount of interest throughout the
contemplated term of the Obligations hereunder.

(i)            The agreements in this Section 24 shall survive the payment of
all Guaranteed Obligations.

Section 25.            Stay of Acceleration.  In the event that acceleration of
the time for payment of any of the obligations guaranteed hereunder is stayed,
in connection with any Insolvency Proceeding commenced by or against any
Permitted Affiliate or Borrower, or otherwise, all such amounts shall
nonetheless be payable jointly and severally by each Permitted Affiliate
immediately upon demand by the Administrative Agent.

 
F-2-16

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Section 26.             Setoff.  If an Event of Default shall have occurred and
be continuing, each Lender and the L/C Issuer is hereby authorized at any time
and from time to time, to the fullest extent permitted by applicable law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final, in whatever currency) at any time held and other
obligations (in whatever currency) at any time owing by such Lender or the L/C
Issuer to or for the credit or the account of any Permitted Affiliate against
any and all of the obligations of the Permitted Affiliates now or hereafter
existing under this Payment Guaranty or any other Guarantor Document to such
Lender or the L/C Issuer, irrespective of whether or not such Lender or the L/C
Issuer shall have made any demand under this Payment Guaranty or any other Loan
Document and although such obligations of such Permitted Affiliate may be
contingent or unmatured or are owed to a branch or office of such Lender or the
L/C Issuer different from the branch or office holding such deposit or obligated
on such indebtedness.  The rights of each Lender and the L/C Issuer under this
Section are in addition to other rights and remedies (including other rights of
setoff) that such Lender or the L/C Issuer may have.  Each Lender and the L/C
Issuer (by its acceptance hereof) agrees to notify the affected Permitted
Affiliate and the Administrative Agent promptly after any such setoff and
application, provided that the failure to give such notice shall not affect the
validity of such setoff and application.

Section 27.             Integration; Modifications.  This Payment Guaranty (a)
integrates all the terms and conditions mentioned in or incidental to this
Payment Guaranty, (b) supersedes all oral negotiations and prior writings with
respect to its subject matter, and (c) is intended by each Permitted Affiliate,
the Administrative Agent and the other Guaranteed Parties as the final
expression of the agreement with respect to the terms and conditions set forth
in this Payment Guaranty and as the complete and exclusive statement of the
terms agreed to by each Permitted Affiliate, the Administrative Agent and the
other Guaranteed Parties.  No representation, understanding, promise or
condition shall be enforceable against any Permitted Affiliate or any Guaranteed
Party unless it is contained in this Payment Guaranty.  This Payment Guaranty
may not be modified except in a writing signed by both Administrative Agent and
the Permitted Affiliate that is to be bound by such modification.  No course of
prior dealing, usage of trade, parol or extrinsic evidence of any nature shall
be used to supplement, modify or vary any of the terms hereof.

Section 28.            Miscellaneous.  The legal incapacity of any Permitted
Affiliate shall not terminate the obligations of such Permitted Affiliate under
this Payment Guaranty, including its obligations with regard to future advances
under the Loan Documents.  The liability of all persons who are in any manner
obligated under this Payment Guaranty shall be joint and several.  The
illegality or unenforceability of one or more provisions of this Payment
Guaranty shall not affect any other provision.  Time is of the essence in the
performance of this Payment Guaranty by each Permitted Affiliate.

Section 29.            Counsel.  Each Permitted Affiliate acknowledges that such
Permitted Affiliate has had adequate opportunity to carefully read this
Guarantee and to consult with an attorney of such Permitted Affiliate’s choice
prior to signing it.

 
F-2-17

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Section 30.            Future Permitted Affiliates.  At such time following the
date hereof as any subsidiary of Borrower, Guarantor or any Permitted Affiliate
becomes an owner of an Unencumbered Asset Pool Property (an “Acceding Permitted
Affiliate”), such Acceding Permitted Affiliate shall execute and deliver to the
Administrative Agent an accession agreement substantially in the form of Annex 1
(the “Accession Agreement”), signifying its agreement to be bound by the
provisions of this Payment Guaranty as a Permitted Affiliate to the same extent
as if such Acceding Permitted Affiliate had originally executed this Payment
Guaranty as of the date hereof.

Section 31.            Counterparts.  This Payment Guaranty may be executed in
one or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.

Section 32.            USA PATRIOT Act Notice.  Each Lender that is subject to
the Act (as hereinafter defined) and the Administrative Agent (for itself and
not on behalf of any Lender) hereby notifies each Permitted Affiliate that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the “Act”), it is required to obtain,
verify and record information that identifies such Permitted Affiliate, which
information includes the name and address of such Permitted Affiliate and other
information that will allow such Lender or the Administrative Agent, as
applicable, to identify such Permitted Affiliate in accordance with the Act.

Section 33.            Time is of the Essence.  Time is of the essence of this
Payment Guaranty and the other Guarantor Documents.

Section 34.            Severability.  If any provision of this Payment Guaranty
or the other Guarantor Documents is held to be illegal, invalid or
unenforceable, (a) the legality, validity and enforceability of the remaining
provisions of this Payment Guaranty and the other Guarantor Documents shall not
be affected or impaired thereby and (b) the parties shall endeavor in good faith
negotiations to replace the illegal, invalid or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to that
of the illegal, invalid or unenforceable provisions.  The invalidity of a
provision in a particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

Section 35.            Defined Terms.  As used in this Payment Guaranty
(including in the recitals hereof), the following terms shall have the following
meanings:

“Bankruptcy Code” means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C.
§101, et seq.).

“Excluded Taxes” means, with respect to any Guaranteed Party or any other
recipient of any payment to be made by or on account of any Guaranteed
Obligation hereunder, (a) taxes imposed on or measured by its overall net income
(however denominated), and franchise taxes imposed on it, under the laws of any
Governmental Authority, (b) any branch profits taxes imposed by the United
States or any similar tax imposed by any Governmental Authority, and (c) in the
case of a Guaranteed Party that is a Foreign Lender, any withholding tax that is
imposed on amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party to the Agreement (or designates a new Lending Office) or
is attributable to such Foreign Lender’s failure or inability (other than as a
result of a Change in Law) to comply with Section 3.1.5 of the Agreement, except
to the extent that such Foreign Lender (or its assignor, if any) was entitled,
at the time of designation of a new Lending Office (or assignment), to receive
additional amounts with respect to such withholding tax pursuant to Section
3.1.5 of the Agreement.

 
F-2-18

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“Guaranteed Obligations” means the obligations guaranteed by the Permitted
Affiliates hereunder, as set forth in Sections 1 and 2.

“Guaranteed Parties” means the Administrative Agent, the L/C Issuer, the Swing
Line Lender and the Lenders.

“Guarantor Documents” means this Payment Guaranty and all other certificates,
documents, agreements and instruments delivered to any Permitted Affiliate under
or in connection with this Payment Guaranty.

“Indemnified Taxes” means Taxes other than Excluded Taxes.

“Loan Party” means Borrower, Guarantor and each Permitted Affiliate.

“Other Taxes” means all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any
payment made hereunder or under any other Guarantor Document or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Payment Guaranty or any other Guarantor Document.  Other Taxes shall not include
any Excluded Taxes.

“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental
Authority and arising from any payment made hereunder or under any other
Guarantor Document or from the execution, delivery or enforcement of, or
otherwise with respect to, this Payment Guaranty or any other Guarantor
Document, including any interest, additions to tax or penalties applicable
thereto.

 
F-2-19

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IN WITNESS WHEREOF, each Permitted Affiliate has executed this Payment Guaranty,
as of the date first above written.

Address Where Notices to Administrative
JMS ACQUISITION LLC, a Delaware limited
 
Agent are to be Sent:
liability company
             
PNC Bank, National Association
By:
ESSEX PORTFOLIO, L.P., a California
 
500 First Avenue
 
limited partnership, its sole member
 
Pittsburgh PA  5219
         
Attention:  Trina Barkley
 
By:
Essex Property Trust, Inc.,
 
Mail Stop:  P7-PFSC-04-P
   
a Maryland corporation, its
 
Telephone:  412-768-0423
   
General Partner
 
Facsimile:  412-762-8672
         
Email:  trina.barkley@pncbank.com
   
By:
           
Name:
 
and
     
Title
         
 
 
PNC Real Estate
         
One PNC Plaza, 249 Fifth Avenue
Address where Notices are to be sent:
 
Pittsburgh PA  15222
         
Attention:  Karen Kennedy
JMS Acquisition, LLC
 
Mailstop:  P1-POPP-19-1
c/o Essex Property Trust, Inc.
 
Telephone:  412-762-3293
925 E. Meadow Drive
 
Facsimile:  412-762-6500
Palo Alto, California  94303
 
Email:  kkennedy@pnc.com
Attn:  Mark J. Mikl; Jordan E. Ritter and
   
Michael T. Dance
   
Facsimile:  (650) 843-1514; (650) 858-1372
   
and (650) 858-0139
       

 
F-2-20

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ESSEX BRIDLE TRAILS, L.P., a California
 
ESSEX GLENBROOK, LLC, a Delaware
 
limited partnership
 
limited liability company
                   
By:
Essex Management Corporation,
 
By:
Essex Portfolio, L.P.,
   
a California corporation, its general
   
a California limited partnership,
   
partner
   
its sole member
                     
By:
     
By:
Essex Property Trust, Inc., a
     
Name:
     
Maryland corporation, its general
     
Title:
     
partner
                   
Address where Notices are to be sent:
     
By:
                 
Name:
 
Essex Bridle Trails, L.P.
       
Title:
 
c/o Essex Property Trust, Inc.
           
925 E. Meadow Drive
 
Address where Notices are to be sent:
 
Palo Alto, California  94303
     
Attn:  Mark J. Mikl; Jordan E. Ritter and
 
Essex Glenbrook, LLC
 
Michael T. Dance
 
c/o Essex Property Trust, Inc.
 
Facsimile:  (650) 843-1514; (650) 858-1372
 
925 E. Meadow Drive
 
and (650) 858-0139
 
Palo Alto, California  94303
     
Attn:  Mark J. Mikl; Jordan E. Ritter and
         
Michael T. Dance
         
Facsimile:  (650) 843-1514; (650) 858-1372
         
and (650) 858-0139
             

 
F-2-21

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ESSEX CHESTNUT APARTMENTS, L.P.,
 
ESSEX MARINA CITY CLUB, L.P.,
 
a California limited partnership
 
a California limited partnership
                         
By:
ESSEX SPE, LLC, a Delaware limited
 
By:
Essex MCC, LLC, a Delaware limited
   
liability company, its general partner
   
liability company, its general partner
                           
By:
Essex Portfolio, L.P., a California
   
By:
Essex Portfolio, L.P., a California
     
limited partnership, its sole member
     
limited partnership, its sole
                 
member
     
By:
Essex Property Trust, Inc.,
                   
a Maryland corporation, its
     
By:
Essex Property Trust, Inc.,
       
general partner
       
a Maryland corporation, its
                   
general partner
       
By:
                       
Name:
       
By:
           
Title:
         
Name:
                     
Title:
 
Address where Notices are to be sent:
                         
Address where Notices are to be sent:
 
Essex Chestnut Apartments, L.P.
             
c/o Essex Property Trust, Inc.
 
Essex Marina City Club, L.P.
 
925 E. Meadow Drive
 
c/o Essex Property Trust, Inc.
 
Palo Alto, California  94303
 
925 E. Meadow Drive
 
Attn:  Mark J. Mikl; Jordan E. Ritter and
 
Palo Alto, California  94303
 
Michael T. Dance
 
Attn:  Mark J. Mikl; Jordan E. Ritter and
 
Facsimile:  (650) 843-1514; (650) 858-1372
 
Michael T. Dance
 
and (650) 858-0139
 
Facsimile:  (650) 843-1514; (650) 858-1372
             
and (650) 858-0139
                         

 
F-2-22

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ESSEX COLUMBUS LLC, a Delaware
 
NEWPORT BEACH NORTH LLC,
 
limited liability company
 
a Delaware limited liability company
                 
By:
Essex Columbus, Inc., a California
 
By:
Newport Beach North, Inc., a Delaware
   
corporation, its managing member
   
corporation, its managing member
                   
By:
     
By:
       
Name:
     
Name:
     
Title:
     
Title:
                 
Address to where Notices are to be sent:
 
Address where Notices are to be sent:
                 
Essex Columbus LLC
 
Newport Beach North LLC
 
c/o Essex Property Trust, Inc.
 
c/o Essex Property Trust, Inc.
 
925 E. Meadow Drive
 
925 E. Meadow Drive
 
Palo Alto, California  94303
 
Palo Alto, California  94303
 
Attn:  Mark J. Mikl; Jordan E. Ritter and
 
Attn:  Mark J. Mikl; Jordan E. Ritter and
 
Michael T. Dance
 
Michael T. Dance
 
Facsimile:  (650) 843-1514; (650) 858-1372
 
Facsimile:  (650) 843-1514; (650) 858-1372
 
and (650) 858-0139
 
and (650) 858-0139
                 

ESSEX TRACY DEVELOPMENT, INC.,
 
ESSEX EUCLID, LLC, a Delaware limited
 
a California corporation
 
liability company
                       
By:
Essex Portfolio, L.P., a California
         
limited partnership, its sole member
 
By:
               
Name:
   
By:
Essex Property Trust, Inc., a
   
Title:
     
Maryland corporation, its general
           
partner
   
Address where Notices are to be sent:
                     
By:
   
Essex Tracy Development, Inc.
       
Name:
 
c/o Essex Property Trust, Inc.
       
Title:
 
925 E. Meadow Drive
           
Palo Alto, California  94303
 
Address where Notices are to be sent:
 
Attn:  Mark J. Mikl; Jordan E. Ritter and
           
Michael T. Dance
 
Essex Euclid, LLC
 
Facsimile:  (650) 843-1514; (650) 858-1372
 
c/o Essex Property Trust, Inc.
 
and (650) 858-0139
 
925 E. Meadow Drive
       
Palo Alto, California  94303
       
Attn:  Mark J. Mikl; Jordan E. Ritter and
       
Michael T. Dance
       
Facsimile:  (650) 843-1514; (650) 858-1372
       
and (650) 858-0139
                 

 
F-2-23

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ESSEX BLUFFS, L.P., a California limited
 
ESSEX SUNPOINTE LTD., a California
 
partnership
 
limited partnership
                   
By:
Essex Management Corporation,
 
By:
Essex Portfolio, L.P., a California
   
a California corporation, its general
   
limited partnership, its general partner
   
partner
                       
By:
Essex Property Trust, Inc.,
   
By:
       
a Maryland corporation, its general
     
Name:
     
partner
     
Title:
                       
By:
   
Address where Notices are to be sent:
       
Name:
               
Title:
 
Essex Bluffs, L.P.
           
c/o Essex Property Trust, Inc.
 
Address where Notices are to be sent:
 
925 E. Meadow Drive
           
Palo Alto, California  94303
 
Essex Sunpointe Ltd.
 
Attn:  Mark J. Mikl; Jordan E. Ritter and
 
c/o Essex Property Trust, Inc.
 
Michael T. Dance
 
925 E. Meadow Drive
 
Facsimile:  (650) 843-1514; (650) 858-1372
 
Palo Alto, California  94303
 
and (650) 858-0139
 
Attn:  Mark J. Mikl; Jordan E. Ritter and
         
Michael T. Dance
         
Facsimile:  (650) 843-1514; (650) 858-1372
         
and (650) 858-0139
                   

 
F-2-24

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ESSEX BERKELEY 4th STREET, L.P.,
 
JAYSAC, LTD., Texas limited partnership
 
a California limited partnership
                     
By:
Jaysac GP Corp., a Delaware
 
By:
Essex Berkeley, LLC, a Delaware
   
corporation, its General Partner
   
limited liability company, its general
           
partner
                       
By:
     
By:
Essex Portfolio, L.P., a California
     
Name:
     
limited partnership, its sole
     
Title:
     
member
                     
Address where Notices are to be sent:
     
By:
Essex Property Trust, Inc.,
               
a Maryland corporation, its
 
Jaysac, Ltd.
       
general partner
 
c/o Essex Property Trust, Inc.
             
925 E. Meadow Drive
       
By:
   
Palo Alto, California  94303
         
Name:
 
Attn:  Mark J. Mikl; Jordan E. Ritter and
         
Title:
 
Michael T. Dance
             
Facsimile:  (650) 843-1514; (650) 858-1372
 
Address where Notices are to be sent:
 
and (650) 858-0139
                     
Essex Berkeley 4th Street, L.P.
         
c/o Essex Property Trust, Inc.
         
925 E. Meadow Drive
         
Palo Alto, California  94303
         
Attn:  Mark J. Mikl; Jordan E. Ritter and
         
Michael T. Dance
         
Facsimile:  (650) 843-1514; (650) 858-1372
         
and (650) 858-0139
                             

 
F-2-25

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ESSEX PARK BOULEVARD, LLC,
 
ESSEX VIEW POINT, LLC, a Delaware
 
a Delaware limited liability company
 
limited liability company
                   
By:
Essex Portfolio, L.P., a California limited
 
By:
Essex Fidelity I Corporation,
   
partnership, its sole member
   
a California corporation
                     
By:
Essex Property Trust, Inc.,
   
By:
       
a Maryland corporation, its general
     
Name:
     
partner
       
Title:
                       
By:
   
Address where Notices are to be sent:
       
Name:
               
Title:
 
Essex View Point, LLC
           
c/o Essex Property Trust, Inc.
 
Address where Notices are to be sent:
 
925 E. Meadow Drive
           
Palo Alto, California  94303
 
Essex Park Boulevard, LLC
 
Attn:  Mark J. Mikl; Jordan E. Ritter and
 
c/o Essex Property Trust, Inc.
 
Michael T. Dance
 
925 E. Meadow Drive
 
Facsimile:  (650) 843-1514; (650) 858-1372
 
Palo Alto, California  94303
 
and (650) 858-0139
 
Attn:  Mark J. Mikl; Jordan E. Ritter and
         
Michael T. Dance
         
Facsimile:  (650) 843-1514; (650) 858-1372
         
and (650) 858-0139
                           

 
F-2-26

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Annex 1
to the Guaranty

FORM OF ACCESSION AGREEMENT

To:
PNC Bank, National Association, as Administrative Agent

Re:
____________________

Ladies and Gentlemen:

This Accession Agreement is made and delivered pursuant to Section 30 of that
certain Payment Guaranty dated as of December ___, 2009 (as amended, modified,
renewed or extended from time to time, the “Payment Guaranty”), made by each
Permitted Affiliate named in the signature pages thereof (each a “Permitted
Affiliate”), in favor of the Lenders party to the Agreement referred to below,
and the L/C Issuer, the Swing Line Lender and PNC Bank, National Association, as
Administrative Agent (in such capacity, the “Administrative Agent”).  All
capitalized terms used in this Accession Agreement and not otherwise defined
herein shall have the meanings assigned to them in either the Payment Guaranty
or the Agreement.

Essex Portfolio, L.P., a California limited partnership (“Borrower”), is party
to that certain Revolving Credit Agreement dated as of December 18, 2009 (the
“Agreement”) by and among Borrower, the Lenders from time to time party thereto
(the “Lenders”), the L/C Issuer, the Swing Line Lender and the Administrative
Agent.

The undersigned, ___________________________ [insert name of acceding Permitted
Affiliate], a ____________________ [corporation, partnership, limited liability
company, etc.], is a direct or indirect wholly-owned subsidiary of Borrower,
Guarantor or any Permitted Affiliate that owns an Unencumbered Asset Pool
Property and hereby acknowledges for the benefit of the Guaranteed Parties that
it shall be a “Permitted Affiliate” for all purposes of the Payment Guaranty
effective from the date hereof.  The undersigned confirms that the
representations and warranties set forth in Section 11 of the Payment Guaranty
are true and correct in all material respects as to the undersigned as of the
date hereof.

Without limiting the foregoing, the undersigned hereby agrees to perform all of
the obligations of a Permitted Affiliate under, and to be bound in all respects
by the terms of, the Payment Guaranty, including, without limitation, Section
11, Section 12 and Section 13 thereof, to the same extent and with the same
force and effect as if the undersigned were an original signatory thereto.

This Accession Agreement shall constitute a Loan Document under the Agreement.

THIS ACCESSION AGREEMENT IS TO BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE INTERNAL LAWS OF THE STATE OF CALIFORNIA (AS PERMITTED BY SECTION 1646.5 OF
THE CALIFORNIA CIVIL CODE OR ANY SIMILAR SUCCESSOR PROVISION), WITHOUT GIVING
EFFECT TO ANY CHOICE OF LAW RULE THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF
ANY JURISDICTION OTHER THAN THE INTERNAL LAWS OF THE STATE OF CALIFORNIA TO THE
RIGHTS AND DUTIES OF THE PARTIES.
 
 
FA-1

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IN WITNESS WHEREOF, the undersigned has executed this Accession Agreement, as of
the date first above written.

 
[Acceding Permitted Affiliate]
       
By
   
Title
         
Address for Notices:
 
c/o
               
Attn.:
   
Fax No.:
   
Email:
 

 
FA-2

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EXHIBIT G-l

FORM OF REVOLVING NOTE

REVOLVING NOTE
 
$_________________________
San Francisco, California
 
December 18, 2009

 
FOR VALUE RECEIVED, ESSEX PORTFOLIO, L.P., a California limited partnership
(“Borrower”), promises to pay to the order of ___________ (“Lender”), at the
offices of PNC Bank, National Association, Administrative Agent for Lender, at
PNC Bank, National Association, PNC Firstside Center, 4th Floor, 500 First
Avenue, Pittsburgh, PA 15219, Attention:  PNC Agency Services, Latonya Tench,
Loan Administrator, or at such other place as Lender may designate in writing
from time to time, the sum of ______________ DOLLARS ($___________), or the
aggregate unpaid principal amount outstanding hereunder, whichever may be the
lesser, in immediately available funds and lawful money of the United States of
America.

Interest shall accrue on amounts outstanding hereunder in accordance with that
certain Revolving Credit Agreement, dated as of December 18, 2009 (the
“Agreement”), among Borrower, the financial institutions party thereto
(collectively, the “Lenders”), and PNC Bank, National Association, as
Administrative Agent for the Lenders (in such capacity, the “Administrative
Agent”), Swing Line Lender and L/C Issuer (capitalized terms used and not
defined herein shall have the meanings given to them in the
Agreement).  Pursuant thereto, interest shall accrue on amounts outstanding
hereunder from time to time: (a) at a fluctuating per annum rate equal to the
Reference Rate plus the Applicable Reference Rate Margin, or (b) at Borrower’s
option, subject to the terms of the Agreement, at a per annum rate equal to the
LIBOR Rate plus the Applicable LIBOR Margin.  A change in the interest rate for
Reference Rate Loans shall take effect on the day specified in the public
announcement of the change in the Reference Rate.  Except as otherwise specified
in the Agreement, interest shall be computed on the basis of a 360-day year and
actual days elapsed.  Interest shall become due and payable in accordance with
the terms of the Agreement.

All unpaid principal and interest outstanding hereunder shall be due and payable
as provided in the Agreement.  This Note may be amended, modified, supplemented
or replaced as provided in the Agreement.

This Note is one of the Notes referred to in the Agreement, and is issued in
conjunction with, and is entitled to all of the rights, benefits and privileges
provided in, the Agreement, as now existing or as the same may from time to time
be supplemented, modified or amended.  The Agreement, among other things,
provides that amounts outstanding hereunder from time to time may be repaid
pursuant to the Agreement and reborrowed from time to time pursuant to the
Agreement, and contains provisions for acceleration of the maturity hereof upon
the happening of certain stated events.  This Note is entitled to the benefits
of the Guaranty and each Payment Guaranty.

 
G-1-1

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

 

Lender may endorse on a schedule annexed to this Note the date, amount and
maturity of each Loan that it makes pursuant to the Agreement and the amount of
each payment of principal that Borrower makes with respect thereto.  Borrower
irrevocably authorizes Lender to endorse this Note, and Lender’s record shall be
conclusive absent manifest error; provided, however, that Lender’s failure to
make, or its error in making, a notation on the attached schedule with respect
to any Loan shall not limit or otherwise affect Borrower’s obligations to Lender
hereunder or under the Agreement.

Borrower waives presentment, demand, protest, notice of protest, notice of
nonpayment or dishonor and all other notices in connection with the delivery,
acceptance, performance, default or enforcement of this Note.  Time is of the
essence hereof.

This Note has been executed by the undersigned in the State of California.  THIS
NOTE IS TO BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF CALIFORNIA (AS PERMITTED BY SECTION 1646.5 OF THE CALIFORNIA CIVIL
CODE OR ANY SIMILAR SUCCESSOR PROVISION), WITHOUT GIVING EFFECT TO ANY CHOICE OF
LAW RULE THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER
THAN THE INTERNAL LAWS OF THE STATE OF CALIFORNIA TO THE RIGHTS AND DUTIES OF
THE PARTIES.

 
ESSEX PORTFOLIO, L.P.,
 
a California limited partnership
         
By:
ESSEX PROPERTY TRUST, INC.,
   
a Maryland corporation
   
its General Partner
           
By:
     
Name:
     
Title:
 

 
G-1-2

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EXHIBIT G-2

FORM OF SWING LINE NOTE

REVOLVING NOTE
 (Swing Line)

$20,000,000
San Francisco, California
 
December 18, 2009

FOR VALUE RECEIVED, ESSEX PORTFOLIO, L.P., a California limited partnership
(“Borrower”), promises to pay to the order of PNC BANK, NATIONAL ASSOCIATION
(“Swing Line Lender”), at the offices of PNC Bank, National Association,
Administrative Agent for Swing Line Lender, at PNC Bank, National Association,
Administrative Agent for Lender, at PNC Bank, National Association, PNC
Firstside Center, 4th Floor, 500 First Avenue, Pittsburgh, PA 15219,
Attention:  PNC Agency Services, Latonya Tench, Loan Administrator, or at such
other place as Swing Line Lender may designate in writing from time to time, the
sum of TWENTY MILLION DOLLARS ($20,000,000), or the aggregate unpaid principal
amount outstanding hereunder, whichever may be the lesser, in immediately
available funds and lawful money of the United States of America.

Interest shall accrue on amounts outstanding hereunder in accordance with that
certain Revolving Credit Agreement, dated as of December 18, 2009 (the
“Agreement”), among Borrower, the financial institutions party thereto
(collectively, the “Lenders”), and PNC Bank, National Association, as
Administrative Agent for the Lenders (in such capacity, the “Administrative
Agent”), Swing Line Lender and L/C Issuer (capitalized terms used and not
defined herein shall have the meanings given to them in the
Agreement).  Pursuant thereto, interest shall accrue on amounts outstanding
hereunder from time to time at a fluctuating per annum rate equal to the
Reference Rate plus the Applicable Reference Rate Margin.  A change in the
interest rate for Swing Line Loans shall take effect on the day specified in the
public announcement of the change in the Reference Rate.  Except as otherwise
specified in the Agreement, interest shall be computed on the basis of a 360-day
year and actual days elapsed.  Interest shall become due and payable in
accordance with the terms of the Agreement.

All unpaid principal and interest outstanding hereunder shall be due and payable
as provided in the Agreement.

This is the Swing Line Note referred to in the Agreement, and is issued in
conjunction with, and is entitled to all of the rights, benefits and privileges
provided in, the Agreement, as now existing or as the same may from time to time
be supplemented, modified or amended.  The Agreement, among other things,
provides that amounts outstanding hereunder from time to time may be repaid
pursuant to the Agreement and reborrowed from time to time pursuant to the
Agreement, and contains provisions for acceleration of the maturity hereof upon
the happening of certain stated events.  This Swing Line Note is entitled to the
benefits of the Guaranty and each Payment Guaranty.

 
G-2-1

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

 

Swing Line Lender may endorse on a schedule annexed to this Swing Line Note the
date, amount and maturity of each Swing Loan that it makes pursuant to the
Agreement and the amount of each payment of principal that Borrower makes with
respect thereto.  Borrower irrevocably authorizes Swing Line Lender to endorse
this Swing Line Note, and Swing Line Lender’s record shall be conclusive absent
manifest error; provided, however, that Swing Line Lender’s failure to make, or
its error in making, a notation on the attached schedule with respect to any
Swing Loan shall not limit or otherwise affect Borrower’s obligations to Swing
Line Lender hereunder or under the Agreement.

Borrower waives presentment, demand, protest, notice of protest, notice of
nonpayment or dishonor and all other notices in connection with the delivery,
acceptance, performance, default or enforcement of this Swing Line Note.  Time
is of the essence hereof.

This Swing Line Note has been executed by the undersigned in the State of
California.  THIS SWING LINE NOTE IS TO BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF CALIFORNIA (AS PERMITTED BY
SECTION 1646.5 OF THE CALIFORNIA CIVIL CODE OR ANY SIMILAR SUCCESSOR PROVISION),
WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW RULE THAT WOULD CAUSE THE APPLICATION
OF THE LAWS OF ANY JURISDICTION OTHER THAN THE INTERNAL LAWS OF THE STATE OF
CALIFORNIA TO THE RIGHTS AND DUTIES OF THE PARTIES.

 
ESSEX PORTFOLIO, L.P.,
 
a California limited partnership
         
By:
ESSEX PROPERTY TRUST, INC.,
   
a Maryland corporation its
   
General Partner
           
By:
     
Name:
     
Title:
 

 
G-2-2

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SCHEDULE 1.1

LENDERS NAMES, ADDRESSES AND PRO RATA SHARES

Lender
 
Commitment
   
Pro Rata Share
               
PNC Bank, National Association
  $ 35,000,000       17.50 %                  
Union Bank, N.A.
  $ 35,000,000       17.50 %                  
Wells Fargo, National Association
  $ 35,000,000       17.50 %                  
Chevy Chase Bank, F.S.B.
  $ 25,000,000       12.50 %                  
Comerica Bank
  $ 25,000,000       12.50 %                  
US Bank, National Association
  $ 25,000,000       12.50 %                  
Keybank, N.A.
  $ 20,000,000       10.00 %                  
Total
  $ 200,000,000       100.00 %

 
Sch.1.1-1

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SCHEDULE 1.2

ADMINISTRATIVE AGENT’S OFFICE;
AGENT’S PAYMENT OFFICE

BORROWER:

ESSEX PORTFOLIO, L.P.
c/o: Essex Property Trust, Inc.
925 East Meadow Drive
Palo Alto CA  94303
Attention:  Mark J. Mikl; Jordan E. Ritter and Michael T. Dance
Facsimile:  (650) 843-1514; (650) 858-1372 and (650) 858-0139
Telephone: (650) 849-1614; (650) 849-1659 and 650-849-1706
Email: mmikl@essexpropertytrust.com; jritter@essexpropertytrust.com and
mdance@essexpropertytrust.com

ADMINISTRATIVE AGENT:

Administrative Agent’s Office
(for payments, advances and financial information):

PNC Bank, National Association
PNC Firstside Center, 4th Floor
500 First Avenue
Pittsburgh PA  15219
Attention:
PNC Agency Services

Latonya Tench
Loan Administrator
Telephone:  412-768-0403
Facsimile:  412-762-8672
Email:  latonya.tench@pnc.com

Wire instructions for PNC Agency Services:
PNC Bank, Pgh
ABA 043 000 096
Account #GL 13076-001-7005
Account Name:  Wire Suspense-Agency Services
Ref:  Essex Portfolio, L.P.

 
Sch.1.2-1

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(for extensions of the maturity date, amendments and/or changes to credit
agreement and any other notices to Administrative Agent):

PNC Bank, National Association
PNC Firstside Center, 5th Floor
500 First Avenue
Pittsburgh PA  15219
Attention:
PNC Agency Services

Trina Barkley
Assistant Vice President
Mailstop:  P7-PFSC-05-W
Telephone:  412-768-0423
Facsimile:  412-705-2006
Email:  trina.barkley@pncbank.com

and

PNC Real Estate
One PNC Plaza, 249 Fifth Avenue
Pittsburgh PA  15222
Attention:  Karen Kennedy
Mailstop:  P1-POPP-19-1
Telephone:  412-762-3293
Facsimile:  412-762-6500
Email:  kkennedy@pnc.com

L/C ISSUER:
PNC Bank, National Association
PNC Firstside Center, 4th Floor
500 First Avenue
Pittsburgh PA  15219
Attention:
PNC Agency Services

Latonya Tench
Loan Administrator
Telephone:  412-768-0403
Facsimile:  412-762-8672
Email:  latonya.tench@pnc.com

and

PNC Real Estate
One PNC Plaza, 249 Fifth Avenue
Pittsburgh PA  15222
Attention:  Karen Kennedy
Mailstop:  P1-POPP-19-1
Telephone:  412-762-3293
 
Sch.1.2-2

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Facsimile:  412-762-6500
Email:  kkennedy@pnc.com

 
Sch.1.2-3

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SWING LINE LENDER:
 
PNC Bank, National Association
500 First Avenue
Pittsburgh PA  5219
Attention:  Trina Barkley
Mail Stop:  P7-PFSC-04-P
Telephone:  412-768-0423
Facsimile:  412-762-8672
Email:  trina.barkley@pncbank.com

and

PNC Real Estate
One PNC Plaza, 249 Fifth Avenue
Pittsburgh PA  15222
Attention:  Karen Kennedy
Mailstop:  P1-POPP-19-1
Telephone:  412-762-3293
Facsimile:  412-762-6500
Email:  kkennedy@pnc.com

Wire instructions for Agency Services:
PNC Bank, Pgh
ABA 043 000 096
Account #GL 13076-001-7005
Account Name:  Wire Suspense-Agency Services
Ref:  Essex Portfolio, L.P.

 
Sch.1.2-4

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SCHEDULE 1.3

PERMITTED AFFILIATES

Essex Berkeley 4th Street, L.P.

Essex Bluffs, L.P.

Essex Bridle Trails, L.P.

Essex Chestnut Apartments, L.P.

Essex Columbus LLC

Essex Euclid, LLC

Essex Glenbrook LLC

Essex Marina City Club, L.P.

Essex Park Boulevard, LLC

Essex Sunpointe Ltd.

Essex Tracy Development, Inc.

Jaysac, Ltd.

JMS Acquisition LLC

Newport Beach North LLC

Essex View Pointe, LLC

 
Sch.1.3-1

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SCHEDULE 1.4

PROCESSING AND RECORDATION FEES

The Administrative Agent will charge a processing and recordation fee (an
“Assignment Fee”‘) in the amount of $3,500 for each assignment; provided,
however, that in the event of two or more concurrent assignments to members of
the same Assignee Group (which may be effected by a suballocation of an assigned
amount among members of such Assignee Group) or two or more concurrent
assignments by members of the same Assignee Group to a single Eligible Assignee
(or to an Eligible Assignee and members of its Assignee Group), the Assignment
Fee will be $3,500 plus the amount set forth below:

Transaction
 
Assignment Fee
 
First four concurrent assignments or suballocations to members of an Assignee
Group (or from members of an Assignee Group, as applicable)
  $ 0.00  
Each additional concurrent assignment or suballocation to a member of such
Assignee Group (or from a member of such Assignee Group, as applicable)
  $ 500  

 
Sch.1.4-1

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