Exhibit 10.3

SECOND AMENDED AND RESTATED AGREEMENT
OF LIMITED PARTNERSHIP

OF

BEHRINGER HARVARD OPERATING PARTNERSHIP I LP

January 1, 2007

 

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TABLE OF CONTENTS

 

 

 

 

 

 

 

 

ARTICLE I  DEFINED TERMS

 

 

 

 

 

 

 

ARTICLE II  PARTNERSHIP FORMATION AND IDENTIFICATION

 

 

2.01

 

Formation.

 

 

2.02

 

Name, Office and Registered Agent.

 

 

2.03

 

Partners.

 

 

2.04

 

Term and Dissolution.

 

 

2.05

 

Filing of Certificate and Perfection of Limited Partnership.

 

 

2.06

 

Certificates Describing Partnership Units.

 

 

 

 

 

 

 

ARTICLE III  BUSINESS OF THE PARTNERSHIP

 

 

 

 

 

 

 

ARTICLE IV  CAPITAL CONTRIBUTIONS AND ACCOUNTS

 

 

4.01

 

Capital Contributions.

 

 

4.02

 

Additional Capital Contributions and Issuances of Additional Partnership
Interests.

 

 

4.03

 

Additional Funding.

 

 

4.04

 

Capital Accounts.

 

 

4.05

 

Percentage Interests.

 

 

4.06

 

No Interest on Contributions.

 

 

4.07

 

Return of Capital Contributions.

 

 

4.08

 

No Third-Party Beneficiary.

 

 

 

 

 

 

 

ARTICLE V  PROFIT AND LOSS; DISTRIBUTIONS

 

 

5.01

 

Allocation of Profit and Loss.

 

 

5.02

 

Distributions of Cash.

 

 

5.03

 

REIT Distribution Requirements.

 

 

5.04

 

No Right to Distributions in Kind.

 

 

5.05

 

Limitations on Return of Capital Contributions.

 

 

5.06

 

Distributions Upon Liquidation.

 

 

5.07

 

Substantial Economic Effect.

 

 

5.08

 

Withholding.

 

 

5.09

 

Tax Consequences to Limited Partners.

 

 

 

 

 

 

 

ARTICLE VI  RIGHTS, OBLIGATIONS AND POWERS OF THE GENERAL PARTNER

 

 

6.01

 

Management of the Partnership.

 

 

6.02

 

Delegation of Authority.

 

 

6.03

 

Indemnification and Exculpation of Indemnitees.

 

 

6.04

 

Liability of the General Partner.

 

 

6.05

 

Reimbursement of or by General Partner.

 

 

6.06

 

Outside Activities.

 

 

6.07

 

Employment or Retention of Affiliates.

 

 

 

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6.08

 

Reserved.

 

 

6.09

 

Title to Partnership Assets.

 

 

6.10

 

Miscellaneous.

 

 

 

 

 

 

 

ARTICLE VII  TRANSFERS OF GENERAL PARTNERSHIP INTERESTS

 

 

7.01

 

Transfers of General Partnership Interests.

 

 

7.02

 

Admission of a Substitute or Additional General Partner.

 

 

7.03

 

Effect of Bankruptcy, Withdrawal, Death or Dissolution of a General Partner.

 

 

7.04

 

Removal of a General Partner.

 

 

 

 

 

 

 

ARTICLE VIII  RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS

 

 

8.01

 

Management of the Partnership.

 

 

8.02

 

Power of Attorney.

 

 

8.03

 

Limitation on Liability of Limited Partners.

 

 

8.04

 

Ownership by Limited Partner of Corporate General Partner or Affiliate.

 

 

8.05

 

Exchange Right.

 

 

8.06

 

Call Right.

 

 

8.07

 

Duties and Conflicts.

 

 

 

 

 

 

 

ARTICLE IX  TRANSFERS OF LIMITED PARTNERSHIP INTERESTS

 

 

9.01

 

Purchase for Investment.

 

 

9.02

 

Restrictions on Transfer of Limited Partnership Interests.

 

 

9.03

 

Admission of Substitute Limited Partner.

 

 

9.04

 

Rights of Assignees of Partnership Interests.

 

 

9.05

 

Effect of Bankruptcy, Death, Incompetence or Termination of a Limited Partner.

 

 

9.06

 

Joint Ownership of Interests.

 

 

 

 

 

 

 

ARTICLE X  BOOKS AND RECORDS; ACCOUNTING; TAX MATTERS

 

 

10.01

 

Books and Records.

 

 

10.02

 

Custody of Partnership Funds; Bank Accounts.

 

 

10.03

 

Fiscal and Taxable Year.

 

 

10.04

 

Annual Tax Information and Report.

 

 

10.05

 

Tax Matters Partner; Tax Elections; Special Basis Adjustments.

 

 

10.06

 

Reports to Limited Partners.

 

 

 

 

 

 

 

ARTICLE XI  AMENDMENT OF AGREEMENT; MEETINGS

 

 

11.01

 

Amendment.

 

 

11.02

 

Meetings of Partners.

 

 

 

 

 

 

 

ARTICLE XII  MERGER, EXCHANGE OR CONVERSION

 

 

12.01

 

Merger, Exchange or Conversion of Partnership.

 

 

12.02

 

Approval of Plan of Merger, Exchange or Conversion.

 

 

12.03

 

Rights of Dissenting Limited Partners.

 

 

12.04

 

Roll-Up Transactions.

 

 

 

 

 

 

 

 

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ARTICLE XIII  GENERAL PROVISIONS

 

 

13.01

 

Notices.

 

 

13.02

 

Survival of Rights.

 

 

13.03

 

Additional Documents.

 

 

13.04

 

Severability.

 

 

13.05

 

Entire Agreement.

 

 

13.06

 

Pronouns and Plurals.

 

 

13.07

 

Headings.

 

 

13.08

 

Counterparts.

 

 

13.09

 

Governing Law.

 

 

13.10

 

Arbitration.

 

 

13.11

 

Vote of Affiliated Limited Partners.

 

 

13.12

 

Acknowledgement as to Exculpation and Indemnification.

 

 

 

EXHIBIT A — Limited Partners and Limited Partners’ Capital Contributions and
Partnership Units

EXHIBIT B — Notice of Exercise of Exchange Right

EXHIBIT C — Call Notice

 

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SECOND AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP

OF

BEHRINGER HARVARD OPERATING PARTNERSHIP I LP

January 1, 2007

This Second Amended and Restated Agreement of Limited Partnership (this
“Agreement”) is entered into effective as of January 1, 2007 by and among BHR,
Inc., a Delaware corporation (the “General Partner”), BHR Business Trust, a
Maryland business trust (“BHR Business Trust”), BHR Partners, LLC, a Delaware
limited liability company (“BHR Partners” and, collectively with BHR Business
Trust, the “Original Limited Partners”), Behringer Harvard REIT I, Inc., a
Maryland corporation (the “Company”), the McCormick Family Trust 1/20/82, a
California trust, Gary S. Carr, an individual, and the Limited Partner(s) set
forth or which may, in the future, be set forth on Exhibit A hereto, as amended
from time to time, with respect to Behringer Harvard Operating Partnership I LP 
(the “Partnership”), a limited partnership formed under the laws of the State of
Texas, pursuant to a Certificate of Limited Partnership filed with the Office of
the Secretary of State of the State of Texas effective as of June 27, 2002.

RECITALS

WHEREAS, that certain Agreement of Limited Partnership of the Partnership dated
June 27, 2002, as amended by that certain Amended and Restated Agreement of
Limited Partnership of the Partnership dated May 11, 2005 (collectively, the
“Original Agreement”), was entered into by and among the Company as the general
partner and BHR Partners as the original limited partner;

WHEREAS, the McCormick Family Trust 1/20/82 and Gary S. Carr were each admitted
as an Additional Limited Partner to the Partnership on July 28, 2005;

WHEREAS, the parties hereto desire to amend and restate the Original Agreement
in order to set forth (a) the number of issued and outstanding Partnership Units
as of the date hereof, (b) the terms and conditions under which the Partnership
will be operated and (c) the rights, obligations, and limitations of the parties
thereto and any additional Limited Partners with respect to each other and the
Partnership as a whole;

WHEREAS, simultaneously with the execution of this Agreement, the Company
transferred 100% of its General Partnership Interest to its wholly-owned
subsidiary, BHR, Inc.;

WHEREAS, simultaneously with the execution of this Agreement, BHR Partners
transferred approximately 88% of its Limited Partnership Interest to BHR
Business Trust, a wholly-owned subsidiary of BHR BT, Inc., a Delaware
corporation, which is itself a wholly-owned subsidiary of the Company;

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WHEREAS, BHR, Inc. has executed any and all documents necessary to be admitted
as General Partner of the Partnership in substitution of the Company; and

WHEREAS, BHR Business Trust has executed any and all documents necessary to be
admitted as a Limited Partner in the Partnership in partial substitution of BHR
Partners.

NOW, THEREFORE, in consideration of the foregoing, of mutual covenants between
the parties hereto, and of other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged by the parties, the parties
hereto agree as follows:

AGREEMENT

ARTICLE I

DEFINED TERMS

The following defined terms used in this Agreement shall have the meanings
specified below:

“Act” means the Texas Revised Uniform Limited Partnership Act, as it may be
amended from time to time.

“Additional Funds” has the meaning set forth in Section 4.03 hereof.

“Additional Limited Partner” means a Person admitted to the Partnership as a
Limited Partner pursuant to Section 4.02 hereof and who is shown as such on the
books and records of the Partnership.

“Additional Securities” means any additional REIT Shares (other than REIT Shares
issued in connection with an exchange pursuant to Section 8.05 hereof) or
rights, options, warrants or convertible or exchangeable securities containing
the right to subscribe for or purchase REIT Shares, as set forth in Section
4.02(a)(ii).

“Administrative Expenses” means (i) all administrative and operating costs and
expenses incurred by the Partnership, (ii) those administrative costs and
expenses of the General Partner, including any salaries or other payments to
directors, officers or employees of the General Partner, any expenses of the
Company that are paid or incurred by the Company or any of its Affiliates on
behalf of the General Partner and reimbursable by the General Partner, and any
accounting and legal expenses of the General Partner, which expenses, the
Partners have agreed, are expenses of the Partnership and not the General
Partner, and (iii) to the extent not included in clause (ii) above, REIT
Expenses; provided, however, that Administrative Expenses shall not include any
administrative costs and expenses incurred by the General Partner that are
attributable to Properties or partnership interests in a Subsidiary Partnership
that are owned by the Company directly.

“Advisor” or “Advisors” means the Person or Persons, if any, appointed, employed
or contracted with by the Company pursuant to its Articles of Incorporation and
responsible for

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directing or performing the day-to-day business affairs of the Company,
including any Person to whom the Advisor subcontracts all or substantially all
of such functions.

“Affiliate” or “Affiliated” means, with respect to any Person, (i) any Person
directly or indirectly owning, controlling or holding, with the power to vote,
10% or more of the outstanding voting securities of such other Person; (ii) any
Person 10% or more of whose outstanding voting securities are directly or
indirectly owned, controlled or held, with the power to vote, by such other
Person; (iii) any Person directly or indirectly controlling, controlled by or
under common control with such other Person; (iv) any executive officer,
director, trustee or general partner of such other Person; and (v) any legal
entity for which such Person acts as an executive officer, director, trustee or
general partner.

“Agreed Value” means (i) the fair market value of a Partner’s non-cash Capital
Contribution as of the date of contribution as agreed to by such Partner and the
General Partner as of the date of contribution as set forth on Exhibit A hereto,
as it may be amended from time to time, or (ii) in the case of any contribution
or distribution of property other than cash not set forth on Exhibit A, the fair
market value of such property as determined by the General Partner at the time
such property is contributed or distributed, reduced by liabilities either
assumed by the Partnership or Partner upon such contribution or distribution or
to which such property is subject when the property is contributed or
distributed.

“Agreement” means this Second Amended and Restated Agreement of Limited
Partnership, as it may be amended or restated from time to time.

“Articles of Incorporation” means the Articles of Incorporation of the Company
filed with the Maryland State Department of Assessments and Taxation, as amended
or restated from time to time.

“Call Notice” means a Call Notice, as defined in Section 8.06(a) hereof and
substantially in the form of Exhibit C hereto.

“Call Right” has the meaning provided in Section 8.06(a) hereof.

“Capital Account” has the meaning provided in Section 4.04 hereof.

“Capital Contribution” means the total amount of cash, cash equivalents, and the
Agreed Value of any Property or other asset contributed or agreed to be
contributed, as the context requires, to the Partnership by each Partner
pursuant to the terms of the Agreement.  Any reference to the Capital
Contribution of a Partner shall include the Capital Contribution made by a
predecessor holder of the Partnership Interest of such Partner.

“Cash Amount” means an amount of cash equal to the Value of the REIT Shares
Amount on the date of receipt by the General Partner of an Exchange Notice.

“Certificate” means any instrument or document that is required under the laws
of the State of Texas, or any other jurisdiction in which the Partnership
conducts business, to be signed

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and sworn to by the Partners of the Partnership (either by themselves or
pursuant to the power-of-attorney granted to the General Partner in Section 8.02
hereof) and filed for recording in the appropriate public offices within the
State of Texas or such other jurisdiction to perfect or maintain the Partnership
as a limited partnership, to effect the admission, withdrawal, or substitution
of any Partner from or to the Partnership, or to protect the limited liability
of the Limited Partners as limited partners under the laws of the State of Texas
or such other jurisdiction.

“Code” means the Internal Revenue Code of 1986, as amended, and as hereafter
amended from time to time.  Reference to any particular provision of the Code
shall mean that provision in the Code at the date hereof and any successor
provision of the Code.

“Commission” means the U.S. Securities and Exchange Commission.

“Company” means Behringer Harvard REIT I, Inc., a Maryland corporation.

“Competent Independent Expert” shall mean a Person with no material current or
prior business or personal relationship with the Advisor, the General Partner or
the Partnership who is engaged to a substantial extent in the business of
rendering opinions regarding the value of the assets of the type held by the
Partnership and who is qualified to perform such work.  Membership in a
nationally recognized appraisal society such as the American Institute of Real
Estate Appraisers or the Society of Real Estate Appraisers shall be conclusive
evidence of such qualification.

“Conversion Factor” means 1.0, provided, that in the event that the Company (i)
declares or pays a dividend on its outstanding REIT Shares in REIT Shares or
makes a distribution to all holders of its outstanding REIT Shares in REIT
Shares, (ii) subdivides its outstanding REIT Shares, or (iii) combines its
outstanding REIT Shares into a smaller number of REIT Shares, the Conversion
Factor shall be adjusted by multiplying the Conversion Factor by a fraction, the
numerator of which shall be the number of REIT Shares issued and outstanding on
the record date for such dividend, distribution, subdivision or combination
(assuming for such purposes that such dividend, distribution, subdivision or
combination has occurred as of such time), and the denominator of which shall be
the actual number of REIT Shares (determined without the above assumption)
issued and outstanding on such date, and provided further, that in the event
that an entity other than an Affiliate of the Company shall become General
Partner pursuant to any merger, consolidation or combination of the Company with
or into another entity (the “Successor Entity”), the Conversion Factor shall be
adjusted by multiplying the Conversion Factor by the number of shares of the
Successor Entity into which one REIT Share is converted pursuant to such merger,
consolidation or combination, determined as of the date of such merger,
consolidation or combination.  Any adjustment to the Conversion Factor shall
become effective immediately after the effective date of such event retroactive
to the record date, if any, for such event; provided, however, that if the
General Partner receives an Exchange Notice after the record date, but prior to
the effective date of such dividend, distribution, subdivision or combination,
the Conversion Factor shall be determined as if the General Partner had received
the Exchange Notice immediately prior to the record date for such dividend,
distribution, subdivision or combination; and provided further, however, that if
the General Partner, in its sole

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and absolute discretion, causes the Partnership to make a distribution of
Partnership Units or to subdivide or combine the outstanding Partnership Units
in order to give equivalent effect to a dividend or distribution of REIT Shares
or a subdivision or combination or REIT Shares, then the Conversion Factor shall
remain the factor which it was immediately prior to such dividend or
distribution of REIT Shares or subdivision or combination of REIT Shares.

“Dissenting Limited Partner” has the meaning provided in Section 12.03(a)
hereof.

“Event of Bankruptcy” as to any Person means (i) the filing of a petition for
relief as to such Person as debtor or bankrupt under the Bankruptcy Code of 1978
or similar provision of law of any jurisdiction (except if such petition is
contested by such Person and has been dismissed within 90 days); (ii) the
insolvency or bankruptcy of such Person as finally determined by a court
proceeding; (iii) the filing by such Person of a petition or application to
accomplish the same or for the appointment of a receiver or a trustee for such
Person or a substantial part of his assets; and (iv) the commencement of any
proceedings relating to such Person as a debtor under any other reorganization,
arrangement, insolvency, adjustment of debt or liquidation law of any
jurisdiction, whether now in existence or hereinafter in effect, either by such
Person or by another, provided, that if such proceeding is commenced by another,
such Person indicates his approval of such proceeding, consents thereto or
acquiesces therein, or such proceeding is contested by such Person and has not
been finally dismissed within 90 days.

“Exchange Amount” means either the Cash Amount or the REIT Shares Amount, as
selected by the Company in its sole and absolute discretion pursuant to Section
8.05(b) hereof.

“Exchange Notice” means a Notice of Exercise of Exchange Right, as defined in
Section 8.05(a) hereof and substantially in the form of Exhibit B hereto.

“Exchange Right” has the meaning provided in Section 8.05(a) hereof.

“Exchanging Partner” has the meaning provided in Section 8.05(a) hereof.

“General Partner” means BHR, Inc., a Delaware corporation, and any Person who
becomes a substitute or additional General Partner as provided herein, and any
successors thereto.

“General Partnership Interest” means a Partnership Interest held by the General
Partner that is a general partnership interest.

“GP Capital” means the aggregate of Capital Contributions of cash made by the
General Partner in accordance with Sections 4.01 and 4.02 hereof.

“GP Minimum Return” means such amount as may be necessary or required to allow
the Company to meet its distribution requirement for qualification as a REIT as
set forth in Section 857 of the Code and to avoid any federal income or excise
tax liability imposed by the Code.

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“Holding Period” means, with respect to Partnership Units acquired by Additional
Limited Partners hereunder, the period commencing on the date of issuance of
such Units through and including the fourth anniversary of such date of
acquisition.

“Indemnitee” means (i) any Person made a party to a proceeding by reason of its
status as the General Partner, as the sole owner of all of the voting securities
of the General Partner, or a director, officer or employee of the General
Partner or the Partnership, and (ii) such other Persons (including Affiliates of
the General Partner or the Partnership) as the General Partner may designate
from time to time, in its sole and absolute discretion.

“Independent Director” means a member of the board of directors of the Company
who is not on the date of determination, and within the last two (2) years from
the date of determination has not been, directly or indirectly associated with
the Company, the Sponsor or the Advisor or any of their respective Affiliates by
virtue of (i) ownership of an interest in the Sponsor or the Advisor or any of
their respective Affiliates, other than the Company, (ii) employment by the
Company, the Sponsor or the Advisor or any of their respective Affiliates, (iii)
service as an officer or director of the Sponsor or the Advisor or their
respective Affiliates, other than as a director of the Company, (iv) performance
of services, other than as a director of the Company, (v) service as a director
or trustee of more than three (3) real estate investment trusts organized by the
Sponsor or advised by the Advisor, or (vi) maintenance of a material business or
professional relationship with the Company, the Sponsor or the Advisor or any of
their respective Affiliates.  A business or professional relationship is
considered “material” if the gross revenue derived by the director from the
Sponsor and the Advisor and their Affiliates exceeds five percent (5%) of either
the director’s annual gross income during either of the last two (2) years or
the director’s net worth on a fair market value basis.  An indirect relationship
with the Sponsor or the Advisor shall include circumstances in which a
director’s spouse, parent, child, sibling, mother- or father-in-law, son- or
daughter-in-law or brother- or sister-in-law is or has been associated with the
Sponsor or the Advisor, any of their respective Affiliates or the Company.

“Joint Venture” means any joint venture or partnership arrangement in which the
Partnership is a co-venturer or general partner established to acquire or hold
Properties, Mortgages or other investments of the Company.

“Limited Partner” means the Original Limited Partners, any Person named as a
Limited Partner on Exhibit A attached hereto, and any Person who becomes a
Substitute or Additional Limited Partner in such person’s capacity as a Limited
Partner in the Partnership.

“Limited Partnership Interest” means the ownership interest of a Limited Partner
in the Partnership at any particular time, including the right of such Limited
Partner to any and all benefits to which such Limited Partner may be entitled as
provided in this Agreement and in the Act, together with the obligations of such
Limited Partner to comply with all the provisions of this Agreement and of such
Act.

“Liquidating Event” has the meaning set forth in Section 2.04 hereof.

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“Loss” has the meaning provided in Section 5.01(f) hereof.

“LP Capital” means the aggregate of Capital Contributions in cash or cash
equivalents and the Agreed Value of any non-cash contributions to the
Partnership made by a Limited Partner in accordance with Sections 4.01 and 4.02
hereof.

“LP Return” means, with regard to any Limited Partner, an amount equal to the
aggregate cash dividends that would have been payable to such Limited Partner
with respect to the applicable fiscal period if such Limited Partner had owned
REIT Shares equal in number to the number of Partnership Units owned by such
Limited Partner during such fiscal period.

“Mortgage” means, in connection with mortgage financing provided, invested in or
purchased by the Partnership, any note, deed of trust, security interest or
other evidence of indebtedness or obligations, which is secured or
collateralized by real property owned by the borrower under such note, deed of
trust, security interest or other evidence of indebtedness or obligations.

“Net Capital Proceeds” means the net cash proceeds received by the Partnership
in connection with (i) any Sale, (ii) any borrowing or refinancing of
borrowing(s) by the Partnership, (iii) any condemnation or deeding in lieu of
condemnation of all or a portion of any Property, (iv) any collection in respect
of property, hazard, or casualty insurance (but not business interruption
insurance) or any damage award; or (v) any other transaction the proceeds of
which, in accordance with generally accepted accounting principles, are
considered to be capital in nature, in each case, after deduction of (a) all
costs and expenses incurred by the Partnership with regard to such transactions
(including, without limitation, any repayment of any indebtedness required to be
repaid as a result of such transaction or which the General Partner elects to
pay out of the proceeds of such transaction, together with accrued interest and
premium, if any, thereon and any sales commissions or other costs or expenses
due and payable to any Person in connection therewith, including to a Partner or
its Affiliates), and (b) all amounts expended by the Partnership for the
acquisition of additional Properties, Mortgages or other investments or for
capital repairs or improvements to any Property with such cash proceeds.

“Offer” has the meaning set forth in Section 7.01(c)(ii) hereof.

“Offering” means the offer and sale of REIT Shares to the public by the Company.

“Original Limited Partners” means the Limited Partners designated as such on
Exhibit A hereto.

“Partner” means any General Partner or Limited Partner.

“Partner Nonrecourse Debt Minimum Gain” has the meaning set forth in Regulations
Section 1.704-2(i).  A Partner’s share of Partner Nonrecourse Debt Minimum Gain
shall be determined in accordance with Regulations Section 1.704-2(i)(5).

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“Partnership” means Behringer Harvard Operating Partnership I LP, a Texas
limited partnership.

“Partnership Interest” means an ownership interest in the Partnership held by
either a Limited Partner or the General Partner and includes any and all
benefits to which the holder of such a Partnership Interest may be entitled as
provided in this Agreement, together with all obligations of such Person to
comply with the terms and provisions of this Agreement.

“Partnership Minimum Gain” has the meaning set forth in Regulations Section
1.704-2(b)(2).  In accordance with Regulations Section 1.704-2(d), the amount of
Partnership Minimum Gain is determined by first computing, for each Partnership
nonrecourse liability, any gain the Partnership would realize if it disposed of
the property subject to that liability for no consideration other than full
satisfaction of the liability, and then aggregating the separately computed
gains.  A Partner’s share of Partnership Minimum Gain shall be determined in
accordance with Regulations Section 1.704-2(g)(1).

“Partnership Record Date” means the record date established by the General
Partner for the distribution of cash pursuant to Section 5.02 hereof, which
record date shall be the same as the record date established by the General
Partner for a distribution to its stockholders.

“Partnership Unit” means a fractional, undivided share of the Partnership
Interests of all Partners issued hereunder.  The number of Partnership Units
held by the Original Limited Partners will, as of any relevant date, equal the
difference between (a) the product of the number of shares of the Company issued
since the formation of the Company through such relevant date (adjusted to
reflect any subdivisions or combinations of shares of the Company through such
relevant date), multiplied by the inverse of the Conversion Factor as of such
relevant date (i.e., one (1) divided by the Conversion Factor as of such
relevant date), and (b) the sum of (i) the number of Partnership Units of the
Original Limited Partners deemed purchased or redeemed pursuant to Section 6.10
since the inception of the Partnership through such relevant date and (ii) all
Partnership Units held by the General Partner.  It is acknowledged that the
Original Limited Partners will contribute the proceeds from the sale of shares
in the Company to the Partnership and the Partnership Units resulting from the
contribution of such proceeds by the Original Limited Partners to the
Partnership will be issued by the Partnership to the Original Limited Partners. 
Furthermore, it is acknowledged that if the Partnership makes a distribution of
Partnership Units or subdivides or combines the outstanding Partnership Units in
order to give equivalent effect to a dividend or distribution of the Company’s
shares or a subdivision or combination of the Company’s shares, then the
Partnership Units held by the Original Limited Partners will not be entitled to
any such distribution of Partnership Units or affected by any such subdivision
or combination of Partnership Units because the number of the Original Limited
Partners’ Partnership Units will have already been adjusted by virtue of the
dividend or distribution of the Company’s shares or the subdivision or
combination of the Company’s shares.

“Percentage Interest” means the percentage ownership interest in the Partnership
of each Partner, as determined by dividing the number of Partnership Units owned
by a Partner by the aggregate number of Partnership Units owned by all Partners.

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“Person” means any individual, partnership, corporation, joint venture, limited
liability company, trust or other entity.

“Profit” has the meaning provided in Section 5.01(f) hereof.

“Property” means any office, industrial or other commercial real property in
which the Partnership holds an ownership interest, either directly or pursuant
to the Partnership’s ownership of an interest in a subsidiary which owns an
interest in any such office, industrial or other commercial real property.

“Prospectus” means the final prospectus, as amended or supplemented, that is
delivered to purchasers of REIT Shares in the Offering.

“Regulations” means the Federal Income Tax Regulations, including temporary or
proposed regulations, issued under the Code, as amended and as hereafter amended
from time to time.  Reference to any particular provision of the Regulations
shall mean that provision of the Regulations on the date hereof and any
successor provision of the Regulations.

“REIT” means a real estate investment trust under Sections 856 through 860 of
the Code.

“REIT Expenses” means (i) costs and expenses relating to the formation and
continuity of existence and operation of the Company and any Subsidiaries
thereof (which Subsidiaries shall, for purposes hereof, be included within the
definition of “Company”), including taxes, fees and assessments associated
therewith, any and all costs, expenses or fees payable to any director, officer,
or employee of the Company, (ii) costs and expenses relating to (A) any
registration and public offering of securities by the Company, the net proceeds
of which were used to make a contribution to the Partnership, and (B) all
statements and reports incidental thereto, including, without limitation,
underwriting discounts and selling commissions applicable to any such offering
of securities, and any costs and expenses associated with any claims made by any
holders of such securities or any underwriters or placement agents thereof,
(iii) costs and expenses associated with any repurchase of any securities by the
Company, (iv) costs and expenses associated with the preparation and filing, of
any periodic or other reports and communications by the Company under federal,
state or local laws or regulations, including filings with the Commission, (v)
costs and expenses associated with compliance by the Company with laws, rules
and regulations promulgated by any regulatory body, including the Commission and
any securities exchange, (vi) costs and expenses associated with any section
401(k) plan, incentive plan, bonus plan or other plan providing for compensation
for the employees of the Company, (vii) costs and expenses incurred by the
Company relating to any issuance or redemption of Partnership Interests or REIT
Shares, and (viii) all other operating or administrative costs of the Company
incurred in the ordinary course of its business on behalf of or in connection
with the Partnership.

“REIT Share” means a share of common stock in the Company (or Successor Entity,
as the case may be).

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“REIT Shares Amount” means a number of REIT Shares equal to the product of the
number of Partnership Units offered for exchange by an Exchanging Partner,
multiplied by the Conversion Factor as adjusted to and including the Specified
Exchange Date; provided that in the event the Company issues to all holders of
REIT Shares rights, options, warrants or convertible or exchangeable securities
entitling the stockholders to subscribe for or purchase REIT Shares, or any
other securities or property (collectively, the “Rights”), and the rights have
not expired at the Specified Exchange Date, then the REIT Shares Amount shall
also include the rights issuable to a holder of the REIT Shares on the record
date fixed for purposes of determining the holders of REIT Shares entitled to
Rights.

“Sale” means any transaction or series of transactions whereby (i) the
Partnership directly or indirectly (except as described in other subsections of
this definitions) sells, grants, transfers, conveys or relinquishes its
ownership of any Property or portion thereof, including the lease of any
Property consisting of a building only, and including any event with respect to
any Property which gives rise to a significant amount of insurance proceeds or
condemnation awards; (ii) the Partnership directly or indirectly (except as
described in other subsections of this definition) sells, grants, transfers,
conveys or relinquishes its ownership of all or substantially all the interest
of the Partnership in any Joint Venture in which it is a co-venturer or partner;
(iii) any Joint Venture directly or indirectly (except as described in other
subsections of this definition) in which the Partnership as a co-venturer or
partner sells, grants, transfers, conveys or relinquishes its ownership of any
Property or portion thereof, including any event with respect to any Property
which gives rise to insurance claims or condemnation awards; (iv) the
Partnership directly or indirectly (except as described in other subsections of
this definition) sells, grants, conveys or relinquishes its interest in any
Mortgage or portion thereof (including with respect to any Mortgage, all
payments thereunder or in satisfaction thereof other than regularly scheduled
interest payments) of amounts owed pursuant to such Mortgage and any event with
respect to a Mortgage which gives rise to a significant amount of insurance
proceeds or similar awards, or (v) the Partnership directly or indirectly
(except as described in other subsections of this definition) sells, grants,
transfers, conveys or relinquishes its ownership of any other asset (other than
investments in bank accounts, money market funds or other current assets) not
previously described in this definition or any portion thereof.

“Securities Act” means the Securities Act of 1933, as amended.

“Service” means the Internal Revenue Service.

“Specified Exchange Date” means the first business day of the month first
occurring after the expiration of 60 business days from the date of receipt by
the General Partner of the Exchange Notice.

“Sponsor” means any Person which (i) is directly or indirectly instrumental in
organizing, wholly or in part, the Company, (ii) will manage or participate in
the management of the Company, and any Affiliate of any such Person, other than
a Person whose only relationship with the Company is that of an independent
property manager and whose only compensation is as such, (iii) takes the
initiative, directly or indirectly, in founding or organizing the Company,
either alone or in conjunction with one or more other Persons, (iv) receives a
material

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participation in the Company in connection with the founding or organizing of
the business of the Company, in consideration of services or property, or both
services and property, (v) has a substantial number of relationships and
contacts with the Company, (vi) possesses significant rights to control
Properties, (vii) receives fees for providing services to the Company which are
paid on a basis that is not customary in the industry, or (viii) provides goods
or services to the Company on a basis which was not negotiated at arm’s-length
with the Company.

“Subsidiary” means, with respect to any Person, any corporation or other entity
of which a majority of (i) the voting power of the voting equity securities or
(ii) the outstanding equity interests is owned, directly or indirectly, by such
Person.

“Subsidiary Partnership” means any partnership, limited liability company or
other entity taxed as a partnership for federal income tax purposes in which
interests are owned by the Company or by a wholly-owned Subsidiary or
Subsidiaries of the Company.

“Substitute Limited Partner” means any Person admitted to the Partnership as a
Limited Partner pursuant to Section 9.03 hereof.

“Successor Entity” has the meaning provided in the definition of “Conversion
Factor” contained herein.

“Survivor” has the meaning set forth in Section 7.01(d) hereof.

“Transaction” has the meaning set forth in Section 7.01(c) hereof.

“Transfer” has the meaning set forth in Section 9.02(a) hereof.

“Transfer Restriction Date” means the effective date upon which Behringer
Advisors LP, a Texas limited partnership, shall cease acting as the advisor to
the Company under the terms of an advisory agreement entered into between
Behringer Advisors LP and the Company.

“Unaffiliated Percentage Interest” means a Percentage Interest held by a Limited
Partner that is not an Affiliate of the Company.

“Unpaid Return” means any accrued but unpaid LP Return or GP Minimum Return less
all amounts distributed by the Partnership to a Limited Partner or the General
Partner in reduction thereof.

“Value” means, with respect to any security, the average of the daily market
price of such security for the ten consecutive trading days immediately
preceding the date as of which such Value is to be determined.  The market price
for each such trading day shall be: (i) if the security is listed or admitted to
trading on any securities exchange, the sale price, regular way, on such day, or
if no such sale takes place on such day, the average of the closing bid and
asked prices, regular way, on such day; (ii) if the security is not listed or
admitted to trading on any securities exchange, the last reported sale price on
such day or, if no sale takes place on such day, the average of the closing bid
and asked prices on such day, as reported by a reliable

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quotation source designated by the Company; or (iii) if the security is not
listed or admitted to trading on any securities exchange and no such last
reported sale price or closing bid and asked prices are available, the average
of the reported high bid and low asked prices on such day, as reported by a
reliable quotation source designated by the Company, or if there shall be no bid
and asked prices on such day, the average of the high bid and low asked prices,
as so reported, on the most recent day (not more than ten days prior to the date
in question) for which prices have been so reported; provided, that if there are
no bid and asked prices reported during the ten days prior to the date in
question, the value of the security shall be determined by the Company acting in
good faith on the basis of such quotations and other information as it
considers, in its reasonable judgment, appropriate.  In the event the security
includes any additional rights, then the value of such rights shall be
determined by the Company acting in good faith on the basis of such quotations
and other information as it considers, in its reasonable judgment, appropriate.

ARTICLE II

PARTNERSHIP FORMATION AND IDENTIFICATION

2.01        FORMATION.  THE PARTNERSHIP IS A LIMITED PARTNERSHIP FORMED PURSUANT
TO THE ACT AND UPON THE TERMS AND CONDITIONS SET FORTH IN THE ORIGINAL
AGREEMENT.  THE PARTNERSHIP SHALL CONTINUE UPON THE EXECUTION OF THIS AGREEMENT.

2.02        NAME, OFFICE AND REGISTERED AGENT.  THE NAME OF THE PARTNERSHIP IS
“BEHRINGER HARVARD OPERATING PARTNERSHIP I LP”  THE REGISTERED OFFICE AND
PRINCIPAL PLACE OF BUSINESS OF THE PARTNERSHIP SHALL BE 15601 DALLAS PKWY.,
SUITE 600, ADDISON, TEXAS 75001.  THE GENERAL PARTNER MAY AT ANY TIME CHANGE THE
LOCATION OF SUCH OFFICE, PROVIDED THE GENERAL PARTNER GIVES NOTICE TO THE
PARTNERS OF ANY SUCH CHANGE.  THE NAME AND ADDRESS OF THE PARTNERSHIP’S
REGISTERED AGENT IS CT CORPORATION SYSTEM, 350 NORTH ST. PAUL, DALLAS, TEXAS
75201.  THE SOLE DUTY OF THE REGISTERED AGENT AS SUCH IS TO FORWARD TO THE
PARTNERSHIP ANY NOTICE THAT IS SERVED ON IT AS REGISTERED AGENT.

2.03        PARTNERS.

(a)           The General Partner of the Partnership is BHR, Inc., a Delaware
corporation.  Its principal place of business is the same as that of the
Partnership.

(b)           The Limited Partners are those Persons identified as Limited
Partners (including the Original Limited Partners) on Exhibit A hereto, as it
may be amended from time to time.

2.04        TERM AND DISSOLUTION.

(a)           The term of the Partnership shall continue in full force and
effect until December 31, 2054, except that the Partnership shall be dissolved
earlier upon the first to occur of any of the following events (“Liquidating
Events”):

(i)            the occurrence of an Event of Bankruptcy as to a General Partner
or the dissolution, death, removal or withdrawal of a General Partner unless the
business of the Partnership is continued pursuant to Section 7.03(b) hereof,
provided, that if a General

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Partner is on the date of such occurrence a partnership, the dissolution of such
General Partner as a result of the dissolution, death, withdrawal, removal or
Event of Bankruptcy of a partner in such partnership shall not be an event of
dissolution of the Partnership if the business of such General Partner is
continued by the remaining partner or partners thereof, either alone or with
additional partners, and such General Partner and such partners comply with any
other applicable requirements of this Agreement;

(ii)           the passage of 90 days after the sale or other disposition of all
or substantially all of the assets of the Partnership (provided, that if the
Partnership receives an installment obligation as consideration for such sale or
other disposition, the Partnership shall continue, unless sooner dissolved under
the provisions of this Agreement, until such time as such obligation is paid in
full);

(iii)          the exchange of all Limited Partnership Interests (other than any
of such interests held by the General Partner or Affiliates of the General
Partner); or

(iv)          the election by the General Partner that the Partnership should be
dissolved.

(b)           Upon dissolution of the Partnership (unless the business of the
Partnership is continued pursuant to Section 7.03(b) hereof), the General
Partner (or its trustee, receiver, successor or legal representative) shall
amend or cancel the Certificate and liquidate the Partnership’s assets and apply
and distribute the proceeds thereof in accordance with Section 5.06 hereof. 
Notwithstanding the foregoing, the liquidating General Partner may either (i)
defer liquidation of, or withhold from distribution for a reasonable time, any
assets of the Partnership (including those necessary to satisfy the
Partnership’s debts and obligations), or (ii) distribute the assets to the
Partners in kind.

2.05        FILING OF CERTIFICATE AND PERFECTION OF LIMITED PARTNERSHIP.  THE
GENERAL PARTNER SHALL EXECUTE, ACKNOWLEDGE, RECORD AND FILE, AT THE EXPENSE OF
THE PARTNERSHIP, THE CERTIFICATE AND ANY AND ALL AMENDMENTS THERETO AND ALL
REQUISITE FICTITIOUS NAME STATEMENTS AND NOTICES IN SUCH PLACES AND
JURISDICTIONS AS MAY BE NECESSARY TO CAUSE THE PARTNERSHIP TO BE TREATED AS A
LIMITED PARTNERSHIP UNDER, AND OTHERWISE TO COMPLY WITH, THE LAWS OF EACH STATE
OR OTHER JURISDICTION IN WHICH THE PARTNERSHIP CONDUCTS BUSINESS.

2.06        CERTIFICATES DESCRIBING PARTNERSHIP UNITS.  AT THE REQUEST OF A
LIMITED PARTNER, THE GENERAL PARTNER MAY, AT ITS OPTION AND IN ITS DISCRETION,
ISSUE A CERTIFICATE SUMMARIZING THE TERMS OF SUCH LIMITED PARTNER’S INTEREST IN
THE PARTNERSHIP, INCLUDING THE NUMBER OF PARTNERSHIP UNITS OWNED AS OF THE DATE
OF SUCH CERTIFICATE.  IF ISSUED, ANY SUCH CERTIFICATES (A) SHALL BE IN FORM AND
SUBSTANCE AS APPROVED BY THE GENERAL PARTNER, (B) SHALL NOT BE NEGOTIABLE, AND
(C) SHALL BEAR A LEGEND SUBSTANTIALLY SIMILAR TO THE FOLLOWING:

“This certificate is not negotiable.  The Partnership Units represented by this
certificate are governed by and transferable only in accordance with the
provisions of the Agreement of Limited Partnership of Behringer Harvard
Operating Partnership I LP, as amended from time to time.”

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ARTICLE III

BUSINESS OF THE PARTNERSHIP

The purpose and nature of the business to be conducted by the Partnership is (a)
to conduct any business that may be lawfully conducted by a limited partnership
organized pursuant to the Act, provided, however, that such business shall be
limited to and conducted in such a manner as to permit the General Partner at
all times to qualify as a REIT, unless the General Partner otherwise ceases to
qualify as a REIT, (b) to enter into any partnership, joint venture or other
similar arrangement to engage in any of the foregoing or the ownership of
interests in any entity engaged in any of the foregoing, and (c) to do anything
necessary or incidental to the foregoing.  In connection with the foregoing, and
without limiting the Company’s right in its sole and absolute discretion to
cease qualifying as a REIT, the Partners acknowledge that the Company’s current
status as a REIT and the avoidance of income and excise taxes on the Company
inures to the benefit of all the Partners and not solely to the Company and the
General Partner.  Notwithstanding the foregoing, the Limited Partners agree that
the Company may terminate its status as a REIT under the Code at any time to the
full extent permitted under its Articles of Incorporation.  The General Partner
shall be empowered to do any and all acts and things necessary or prudent to
ensure that the Partnership will not be classified as a “publicly traded
partnership” for purposes of Section 7704 of the Code.

ARTICLE IV

CAPITAL CONTRIBUTIONS AND ACCOUNTS

4.01        CAPITAL CONTRIBUTIONS.  AS OF JANUARY 1, 2007, THE PARTIES HERETO,
OR THEIR RESPECTIVE PREDECESSORS IN INTEREST AS THE CASE MAY BE, HAVE MADE
CAPITAL CONTRIBUTIONS TO THE PARTNERSHIP, AS APPLICABLE, IN EXCHANGE FOR THE
NUMBER OF PARTNERSHIP UNITS (ESTIMATED AS OF JANUARY 1, 2007 WITH RESPECT TO THE
ORIGINAL LIMITED PARTNERS ONLY) SET FORTH OPPOSITE THEIR NAMES ON EXHIBIT A. 
AFTER THE COMPANY HAS FILED ITS ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR
ENDED DECEMBER 31, 2006, THE GENERAL PARTNER SHALL, WITHOUT THE APPROVAL OF ANY
OTHER PARTNER, ATTACH AN AMENDED EXHIBIT A TO THIS AGREEMENT TO REFLECT THE
ACTUAL NUMBER OF PARTNERSHIP UNITS HELD BY THE ORIGINAL LIMITED PARTNERS AS OF
JANUARY 1, 2007.  AT SUCH TIME AS ADDITIONAL LIMITED PARTNERS ARE ADMITTED TO
THE PARTNERSHIP, EACH SHALL MAKE CAPITAL CONTRIBUTIONS AS SET FORTH OPPOSITE
THEIR NAMES ON EXHIBIT A, AS IT MAY BE AMENDED FROM TIME TO TIME.  EXHIBIT A
SHALL BE DEEMED AMENDED UPON, AND THE GENERAL PARTNER MAY, WITHOUT THE APPROVAL
OF ANY OTHER PARTNER, ATTACH AN AMENDED EXHIBIT A TO THIS AGREEMENT TO REFLECT:
(A) THE ISSUANCE OF PARTNERSHIP UNITS ISSUED TO ADDITIONAL LIMITED PARTNERS OR
TO ANY EXISTING LIMITED PARTNER PURSUANT TO SECTION 4.02 (INCLUDING THE ORIGINAL
LIMITED PARTNERS), (B) ANY PARTNERSHIP UNITS PURCHASED OR REDEEMED PURSUANT TO
SECTION 6.10, (C) ANY REDEMPTION OR PURCHASE OF PARTNERSHIP UNITS BY THE
PARTNERSHIP OR THE COMPANY BY REASON OF THE EXERCISE BY A LIMITED PARTNER OF THE
EXCHANGE RIGHT, (D) ANY PURCHASE BY THE COMPANY (OR ANY OF ITS AFFILIATES) OF
PARTNERSHIP UNITS PURSUANT TO THE CALL RIGHT AND (E) ANY CHANGES REQUIRED
PURSUANT TO THE SECOND SENTENCE OF THIS SECTION 4.01.

4.02        ADDITIONAL CAPITAL CONTRIBUTIONS AND ISSUANCES OF ADDITIONAL
PARTNERSHIP INTERESTS.

Except as provided in this Section 4.02 or in Section 4.03, the Partners shall
have no right

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or obligation to make any additional Capital Contributions or loans to the
Partnership.  The General Partner may contribute additional capital to the
Partnership, from time to time, and receive additional Partnership Units in
respect thereof in the manner contemplated by this Section 4.02.

(a)           Issuances of Additional Partnership Interests.

(i)            General.  The General Partner is hereby authorized to cause the
Partnership to issue additional Partnership Interests in the form of Partnership
Units for any Partnership purpose, at any time or from time to time, to the
Partners (including the General Partner) or to other Persons for such
consideration and on such terms and conditions as shall be established by the
General Partner in its sole and absolute discretion, all without the approval of
any Limited Partners.  Any additional Partnership Interests issued thereby may
be issued in one or more classes, or one or more series of any of such classes,
with such designations, preferences and relative participating, optional or
other special rights, powers and duties, including rights, powers and duties
senior to Limited Partnership Interests, all as shall be determined by the
General Partner in its sole and absolute discretion and without the approval of
any Limited Partner, subject to Texas law, including, without limitation, (A)
the allocations of items of Partnership income, gain, loss, deduction and credit
to each such class or series of Partnership Interests; (B) the right of each
such class or series of Partnership Interests to share in Partnership
distributions; and (C) the rights of each such class or series of Partnership
Interests upon dissolution and liquidation of the Partnership; provided,
however, that no additional Partnership Interests shall be issued to the General
Partner or the Original Limited Partners unless:

(1)           the additional Partnership Interests are issued in connection with
an issuance of REIT Shares or other interests in, the Company, which shares or
interests have designations, preferences and other rights such that the economic
interests are substantially similar to the designations, preferences and other
rights of the additional Partnership Interests issued to the General Partner or
the Original Limited Partners by the Partnership in accordance with this Section
4.02, and the General Partner, on its own or with the Original Limited Partners,
shall make a Capital Contribution to the Partnership in an amount equal to the
aggregate proceeds raised in connection with the issuance of such shares of
stock of or other interests in the Company;

(2)           the additional Partnership Interests are issued in exchange for
property or other assets owned by the General Partner or Original Limited
Partners with a fair market value, as determined by the General Partner, in good
faith, equal to the value of the Partnership Interests; or

(3)           the additional Partnership Interests are issued to all Partners in
proportion to their respective Percentage Interests.

Without limiting the foregoing, the General Partner is expressly authorized to
cause the Partnership to issue Partnership Units for less than fair market
value, so long as the General

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Partner concludes in good faith that such issuance is in the best interests of
the Company and the Partnership.

(ii)           Issuance of Additional Securities.  The Company shall not issue
any additional REIT Shares (other than REIT Shares issued in connection with an
exchange made pursuant to Section 8.05 hereof) or rights, options, warrants or
convertible or exchangeable securities containing the right to subscribe for or
purchase REIT Shares (collectively, “Additional Securities”), other than to all
holders of REIT Shares or pursuant to an Offering, unless (A) the General
Partner shall cause the Partnership to issue to the General Partner (or to the
General Partner and/or the Original Limited Partners), as the General Partner
may designate, Partnership Interests or rights, options, warrants or convertible
or exchangeable securities of the Partnership having designations, preferences
and other rights such that the economic interests are substantially similar to
those of the Additional Securities, and (B) the Company through the General
Partner (or the General Partner and/or the Original Limited Partners)
contributes the proceeds from the issuance of such Additional Securities and
from any exercise of rights contained in such Additional Securities to the
Partnership; provided, however, that the Company is allowed to issue Additional
Securities in connection with an acquisition of a Property or other asset to be
held directly by the General Partner, but if and only if, such direct
acquisition and issuance of Additional Securities have been approved and
determined to be in the best interests of the Company and the Partnership by a
majority of the Independent Directors and Limited Partners holding more than 50%
of the Unaffiliated Percentage Interests, if any.  Without limiting the
foregoing, the General Partner is expressly authorized to issue Additional
Securities for less than fair market value, and to cause the Partnership to
issue to the General Partner (or to the General Partner and/or the Original
Limited Partners) corresponding Partnership Interests, so long as (1) the
Company concludes in good faith that such issuance is in the best interests of
the Company and the Partnership, including without limitation, the issuance of
REIT Shares and corresponding Partnership Units pursuant to an employee share
purchase plan providing for employee purchases of REIT Shares at a discount from
fair market value or employee stock options that have an exercise price that is
less than the fair market value of the REIT Shares, either at the time of
issuance or at the time of exercise, and (2) the Company through the General
Partner (or the General Partner and/or the Original Limited Partners)
contributes all proceeds from such issuance to the Partnership.

(b)           Certain Deemed Contributions of Proceeds of Issuance of REIT
Shares.  In connection with any and all issuances of REIT Shares, the Company
through the General Partner (or the General Partner and/or the Original Limited
Partners) shall make Capital Contributions to the Partnership of the proceeds
therefrom, provided, that if the proceeds actually received and contributed by
the Company are less than the gross proceeds of such issuance as a result of any
underwriter’s discount or other fees or expenses paid or incurred in connection
with such issuance, then the General Partner (or the General Partner together
with the Original Limited Partners, as applicable) shall be deemed to have made
Capital Contributions to the Partnership in the aggregate amount of the gross
proceeds of such issuance and the Partnership shall be deemed simultaneously to
have paid such offering expenses in accordance with Section 6.05 hereof and in
connection with the required issuance of additional Partnership Units for such
Capital Contributions pursuant to Section 4.02(a) hereof.

 

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(c)           Original Limited Partner Deemed Contributions.  In the event that
any Original Limited Partner elects to defer any distribution of cash hereunder
to be made to it pursuant to Section 5.02(a) hereof, then such amount shall be
deemed to be an additional contribution of capital to the Partnership by the
Original Limited Partner, which shall be added to the Original Limited Partner’s
Capital Contribution to the Partnership and the Original Limited Partner’s
Capital Account as established and maintained under Section 4.04 hereof.

4.03        ADDITIONAL FUNDING.  IF THE GENERAL PARTNER DETERMINES THAT IT IS IN
THE BEST INTERESTS OF THE PARTNERSHIP TO PROVIDE FOR ADDITIONAL PARTNERSHIP
FUNDS (“ADDITIONAL FUNDS”) FOR ANY PARTNERSHIP PURPOSE, THE GENERAL PARTNER MAY
(A) CAUSE THE PARTNERSHIP TO OBTAIN SUCH FUNDS FROM OUTSIDE BORROWINGS, OR (B)
ELECT TO HAVE THE GENERAL PARTNER OR ANY OF ITS AFFILIATES PROVIDE SUCH
ADDITIONAL FUNDS TO THE PARTNERSHIP THROUGH LOANS OR OTHERWISE.

4.04        CAPITAL ACCOUNTS.  A SEPARATE CAPITAL ACCOUNT (A “CAPITAL ACCOUNT”)
SHALL BE ESTABLISHED AND MAINTAINED FOR EACH PARTNER IN ACCORDANCE WITH
REGULATIONS SECTION 1.704-1(B)(2)(IV).  IF (A) A NEW OR EXISTING PARTNER
ACQUIRES AN ADDITIONAL PARTNERSHIP INTEREST IN EXCHANGE FOR MORE THAN A DE
MINIMIS CAPITAL CONTRIBUTION, (B) THE PARTNERSHIP DISTRIBUTES TO A PARTNER MORE
THAN A DE MINIMIS AMOUNT OF PARTNERSHIP PROPERTY AS CONSIDERATION FOR THE
REDEMPTION OF A PARTNERSHIP INTEREST, OR (C) THE PARTNERSHIP IS LIQUIDATED
WITHIN THE MEANING OF REGULATIONS SECTION 1.704-1(B)(2)(II)(G), THE GENERAL
PARTNER SHALL REVALUE THE PROPERTY OF THE PARTNERSHIP TO ITS FAIR MARKET VALUE
(AS DETERMINED BY THE GENERAL PARTNER, IN ITS SOLE AND ABSOLUTE DISCRETION, AND
TAKING INTO ACCOUNT SECTION 7701(G) OF THE CODE) IN ACCORDANCE WITH REGULATIONS
SECTION 1.704-L(B)(2)(IV)(F).  WHEN THE PARTNERSHIP’S PROPERTY IS REVALUED BY
THE GENERAL PARTNER, THE CAPITAL ACCOUNTS OF THE PARTNERS SHALL BE ADJUSTED IN
ACCORDANCE WITH REGULATIONS SECTIONS 1.704-1(B)(2)(IV)(F) AND (G), WHICH
GENERALLY REQUIRE SUCH CAPITAL ACCOUNTS TO BE ADJUSTED TO REFLECT THE MANNER IN
WHICH THE UNREALIZED GAIN OR LOSS INHERENT IN SUCH PROPERTY (THAT HAS NOT BEEN
REFLECTED IN THE CAPITAL ACCOUNTS PREVIOUSLY) WOULD BE ALLOCATED AMONG THE
PARTNERS PURSUANT TO SECTION 5.01 HEREOF IF THERE WERE A TAXABLE DISPOSITION OF
SUCH PROPERTY FOR ITS FAIR MARKET VALUE (AS DETERMINED BY THE GENERAL PARTNER,
IN ITS SOLE AND ABSOLUTE DISCRETION, AND TAKING INTO ACCOUNT SECTION 7701(G) OF
THE CODE) ON THE DATE OF THE REVALUATION.

4.05        PERCENTAGE INTERESTS.  IF THE NUMBER OF OUTSTANDING PARTNERSHIP
UNITS INCREASES OR DECREASES DURING A TAXABLE YEAR, EACH PARTNER’S PERCENTAGE
INTEREST SHALL BE ADJUSTED BY THE GENERAL PARTNER EFFECTIVE AS OF THE DATE OF
EACH SUCH INCREASE OR DECREASE TO A PERCENTAGE EQUAL TO THE NUMBER OF
PARTNERSHIP UNITS HELD BY SUCH PARTNER DIVIDED BY THE AGGREGATE NUMBER OF
PARTNERSHIP UNITS OUTSTANDING AFTER GIVING EFFECT TO SUCH INCREASE OR DECREASE. 
IN SUCH EVENT, THE GENERAL PARTNER SHALL REVALUE THE PROPERTY OF THE PARTNERSHIP
AND THE CAPITAL ACCOUNT FOR EACH PARTNER SHALL BE ADJUSTED AS SET FORTH IN
SECTION 4.04 HEREOF.  IF THE PARTNERS’ PERCENTAGE INTERESTS ARE ADJUSTED
PURSUANT TO THIS SECTION 4.05, THE PROFIT AND LOSS FOR THE TAXABLE YEAR IN WHICH
THE ADJUSTMENT OCCURS SHALL BE PRORATED BETWEEN THE PART OF THE YEAR ENDING ON
THE DAY WHEN THE PARTNERSHIP’S PROPERTY IS REVALUED BY THE GENERAL PARTNER AND
THE PART OF THE YEAR BEGINNING ON THE FOLLOWING DAY AND, AS SO DIVIDED, SHALL BE
ALLOCATED TO THE PARTNERS BASED ON THEIR PERCENTAGE INTERESTS BEFORE ADJUSTMENT,
AND THEIR ADJUSTED PERCENTAGE INTERESTS, RESPECTIVELY, EITHER (A) AS IF THE
TAXABLE YEAR HAD ENDED ON THE DATE OF THE ADJUSTMENT OR (B) BASED ON THE NUMBER
OF DAYS IN EACH PART.  THE GENERAL PARTNER, IN ITS SOLE AND ABSOLUTE DISCRETION,
SHALL DETERMINE WHICH METHOD

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SHALL BE USED TO ALLOCATE PROFIT AND LOSS FOR THE TAXABLE YEAR IN WHICH AN
ADJUSTMENT OCCURS, AS MAY BE REQUIRED OR PERMITTED UNDER SECTION 706 OF THE
CODE.

4.06        NO INTEREST ON CONTRIBUTIONS.  NO PARTNER SHALL BE ENTITLED TO
INTEREST ON ITS CAPITAL CONTRIBUTION, EXCEPT AS SPECIFICALLY PROVIDED IN THIS
AGREEMENT.

4.07        RETURN OF CAPITAL CONTRIBUTIONS.  NO PARTNER SHALL BE ENTITLED TO
WITHDRAW ANY PART OF ITS CAPITAL CONTRIBUTION OR ITS CAPITAL ACCOUNT OR TO
RECEIVE ANY DISTRIBUTION FROM THE PARTNERSHIP, EXCEPT AS SPECIFICALLY PROVIDED
IN THIS AGREEMENT.  EXCEPT AS OTHERWISE PROVIDED HEREIN, THERE SHALL BE NO
OBLIGATION TO RETURN TO ANY PARTNER OR WITHDRAWN PARTNER ANY PART OF SUCH
PARTNER’S CAPITAL CONTRIBUTION FOR SO LONG AS THE PARTNERSHIP CONTINUES IN
EXISTENCE.

4.08        NO THIRD-PARTY BENEFICIARY.  NO CREDITOR OR OTHER THIRD PARTY HAVING
DEALINGS WITH THE PARTNERSHIP SHALL HAVE THE RIGHT TO ENFORCE THE RIGHT OR
OBLIGATION OF ANY PARTNER TO MAKE CAPITAL CONTRIBUTIONS OR LOANS OR TO PURSUE
ANY OTHER RIGHT OR REMEDY HEREUNDER OR AT LAW OR IN EQUITY, IT BEING UNDERSTOOD
AND AGREED THAT THE PROVISIONS OF THIS AGREEMENT SHALL BE SOLELY FOR THE BENEFIT
OF, AND MAY BE ENFORCED SOLELY BY, THE PARTIES HERETO AND THEIR RESPECTIVE
SUCCESSORS AND ASSIGNS.  NONE OF THE RIGHTS OR OBLIGATIONS OF THE PARTNERS
HEREIN SET FORTH TO MAKE CAPITAL CONTRIBUTIONS OR LOANS TO THE PARTNERSHIP SHALL
BE DEEMED AN ASSET OF THE PARTNERSHIP FOR ANY PURPOSE BY ANY CREDITOR OR OTHER
THIRD PARTY, NOR MAY SUCH RIGHTS OR OBLIGATIONS BE SOLD, TRANSFERRED OR ASSIGNED
BY THE PARTNERSHIP OR PLEDGED OR ENCUMBERED BY THE PARTNERSHIP TO SECURE ANY
DEBT OR OTHER OBLIGATION OF THE PARTNERSHIP OR OF ANY OF THE PARTNERS.  IN
ADDITION, IT IS THE INTENT OF THE PARTIES HERETO THAT NO DISTRIBUTION TO ANY
LIMITED PARTNER SHALL BE DEEMED A RETURN OF MONEY OR OTHER PROPERTY IN VIOLATION
OF THE ACT.  HOWEVER, IF ANY COURT OF COMPETENT JURISDICTION HOLDS THAT,
NOTWITHSTANDING THE PROVISIONS OF THIS AGREEMENT, ANY LIMITED PARTNER IS
OBLIGATED TO RETURN SUCH MONEY OR PROPERTY, SUCH OBLIGATION SHALL BE THE
OBLIGATION OF SUCH LIMITED PARTNER AND NOT OF THE GENERAL PARTNER.  WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, A DEFICIT CAPITAL ACCOUNT OF A PARTNER
SHALL NOT BE DEEMED TO BE A LIABILITY OF SUCH PARTNER NOR AN ASSET OR PROPERTY
OF THE PARTNERSHIP.

ARTICLE V

PROFIT AND LOSS; DISTRIBUTIONS

5.01        ALLOCATION OF PROFIT AND LOSS.

(a)           After giving effect to the special allocations set forth in
Sections 5.01(b), (c) and (d), Profit for each fiscal year of the Partnership
shall be allocated as follows: (i) first to the Partners, pro rata, in
accordance with and in proportion to their respective Partnership Interests, in
amounts equal to the amount of cash distributed to the Partners pursuant to
Section 5.02(a) hereof with respect to such fiscal year; (ii) second, to the
extent the amount of Profit for such fiscal year exceeds the amount of cash
distributed to the Partners pursuant to Section 5.02(a) hereof, such excess
shall be allocated to the General Partner and the Limited Partners in amounts
and in proportion to the cumulative Loss allocated to the General Partner
pursuant to clause (y) of this Section 5.01(a) and the cumulative Loss allocated
to the Limited Partners pursuant to clause (x) of this Section 5.01(a),
respectively; and (iii) finally, the balance, if any, of Profit shall be
allocated to the Partners in accordance with and in proportion to their
respective Percentage

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Interests.  Notwithstanding the foregoing, however, it is the intent of the
Partners that allocations of Profit to the Limited Partners be such that the
amount of Profit allocated to each Limited Partner be equal to the amount of
income that would have been allocated to such Limited Partner with respect to
the applicable fiscal period if such Limited Partner had owned REIT Shares equal
in number to the number of Partnership Units owned by such Limited Partner
during such fiscal period, and if, for any reason, the foregoing allocations of
Profit result in any material variation from this concept, Profit shall be
allocated to each Limited Partner in an amount equal to the aggregate amount of
income that would have been allocated to such Limited Partner with respect to
the applicable fiscal period if such Limited Partner had owned REIT Shares equal
in number to the number of Partnership Units owned by such Limited Partner
during such fiscal period.  After giving effect to the special allocations set
forth in Sections 5.01(b), (c) and (d), Loss for a fiscal year of the
Partnership shall be allocated as follows: (w) first, to the Partners, pro rata,
in accordance with and in proportion to their respective Partnership Interests,
until the cumulative Loss allocated to each Partner under this clause (w) equals
the cumulative Profit allocated to each Partner under clause (ii) of this
Section 5.01(a); (x) second, to the Limited Partners in an amount equal to each
such Limited Partner’s Capital Account balance prior to the allocation made
under this clause (x); (y) third, to the General Partner in an amount equal to
the General Partner’s Capital Account balance prior to the allocation made under
this clause (y); and (z) fourth, to the General Partner to the extent that any
further allocation of Loss to Limited Partners would result in any such Limited
Partners having a deficit balance in their Capital Accounts.

(b)           Notwithstanding any provision to the contrary herein, (i) any
expense of the Partnership that is a “nonrecourse deduction” within the meaning
of Regulations Section 1.704-2(b)(1) shall be allocated in accordance with the
Partners’ respective Percentage Interests, (ii) any expense of the Partnership
that is a “partner nonrecourse deduction” within the meaning of Regulations
Section 1.704-2(i)(2) shall be allocated to the Partner that bears the “economic
risk of loss” of such deduction in accordance with Regulations Section
1.704-2(i)(1), (iii) if there is a net decrease in Partnership Minimum Gain
within the meaning of Regulations Section 1.704-2(f)(1) for any Partnership
taxable year, then, subject to the exceptions set forth in Regulations Section
1.704-2(f)(2), (3), (4) and (5), items of gain and income shall be allocated
among the Partners in accordance with Regulations Section 1.704-2(f) and the
ordering rules contained in Regulations Section 1.704-2(j), and (iv) if there is
a net decrease in Partner nonrecourse debt minimum gain within the meaning of
Regulations Section 1.704-2(i)(4) for any Partnership taxable year, then,
subject to the exceptions set forth in Regulations Section 1.704-2(g), items of
gain and income shall be allocated among the Partners, in accordance with
Regulations Section 1.704-2(i)(4) and the ordering rules contained in
Regulations Section 1.704-2(j).  A Partner’s “interest in partnership profits”
for purposes of determining its share of the nonrecourse liabilities of the
Partnership within the meaning of Regulations Section 1.752-3(a)(3) shall be
such Partner’s Percentage Interest.

(c)           If a Partner receives in any taxable year an adjustment,
allocation, or distribution described in subparagraphs (4), (5), or (6) of
Regulations Section 1.704-1(b)(2)(ii)(d) that causes or increases a deficit
balance in such Partner’s Capital Account that exceeds the sum of such Partner’s
shares of Partnership Minimum Gain and Partner nonrecourse debt minimum gain, as
determined in accordance with Regulations Sections 1.704-2(g) and 1.704-2(i),
such Partner shall be allocated specially for such taxable year (and, if
necessary, later taxable years) items of income and gain in an amount and manner
sufficient to eliminate such deficit Capital Account

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balance as quickly as possible as provided in Regulations Section
1.704-1(b)(2)(ii)(d).  After the occurrence of an allocation of income or gain
to a Partner in accordance with this Section 5.01(c), to the extent permitted by
Regulations Section 1.704-1(b), items of expense or loss shall be allocated to
such Partner in an amount necessary to offset the income or gain previously
allocated to such Partner under this Section 5.01(c).

(d)           Loss shall not be allocated to a Limited Partner to the extent
that such allocation would cause a deficit in such Partner’s Capital Account
(after reduction to reflect the items described in Regulations Section
1.704-1(b)(2)(ii)(d)(4), (5) and (6)) to exceed the sum of such Partner’s shares
of Partnership Minimum Gain and Partner nonrecourse debt minimum gain.  Any Loss
in excess of that limitation shall be allocated to the General Partner.  After
the occurrence of an allocation of Loss to the General Partner in accordance
with this Section 5.01(d), to the extent permitted by Regulations Section
1.704-1(b), Profit shall be allocated to the General Partner in an amount
necessary to offset the Loss previously allocated to the General Partner under
this Section 5.01(d).

(e)           If a Partner transfers any part or all of its Partnership
Interest, the distributive shares of the various items of Profit and Loss
allocable among the Partners during such fiscal year of the Partnership shall be
allocated between the transferor and the transferee Partner either (i) as if the
Partnership’s fiscal year had ended on the date of the transfer, or (ii) based
on the number of days of such fiscal year that each was a Partner without regard
to the results of Partnership activities in the respective portions of such
fiscal year in which the transferor and the transferee were Partners.  The
General Partner, in its sole and absolute discretion, shall determine which
method shall be used to allocate the distributive shares of the various items of
Profit and Loss between the transferor and the transferee Partner.

(f)            “Profit” and “Loss” and any items of income, gain, expense, or
loss referred to in this Agreement shall be determined in accordance with
federal income tax accounting principles, as modified by Regulations Section
1.704-(b)(2)(iv), except that Profit and Loss shall not include items of income,
gain and expense that are specially allocated pursuant to Sections 5.01(b),
5.01(c), or 5.01(d).  All allocations of income, Profit, gain, Loss, and expense
(and all items contained therein) for federal income tax purposes shall be
identical to all allocations of such items set forth in this Section 5.01,
except as otherwise required by Section 704(c) of the Code and Regulations
Section 1.704-1(b)(4).  Any deductions, income, gain or loss (“Tax Items”) with
respect to Partnership property that is contributed to the Partnership by a
Partner shall be shared among the Partners for income tax purposes pursuant to
Regulations promulgated under Section 704(c) of the Code, so as to take into
account the variation, if any, between the basis of the property to the
Partnership and its initial Agreed Value.  With respect to any property that is
contributed to the Partnership by Ryanco Partners Ltd. No. X, a California
limited partnership, such variation between basis and initial Agreed Value shall
be taken into account under the “traditional method” with curative allocations
on sale as described in Regulations Section 1.704-3.  With respect to any other
non-cash properties subsequently contributed to the Partnership, the Partnership
shall account for such variation under any method approved under Section 704(c)
of the Code and the applicable regulations as chosen by the General Partner.  In
the event Agreed Value of any Partnership asset is adjusted, subsequent
allocations of Tax Items with respect to such asset shall take account of the
variation, if any, between the adjusted basis of such asset and its Agreed Value
in the same manner as under Section 704(c) of the Code and the applicable

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regulations consistent with the requirements of Regulations Section
1.704-1(b)(2)(iv)(g) using any method approved under 704(c) of the Code and the
applicable regulations as chosen by the General Partner.

(g)           If the General Partner determines that is advantageous to the
business of the Partnership to amend the allocation provisions of this Agreement
so as to permit the Partnership to avoid the characterization of Partnership
income allocable to various qualified plans, IRAs and other entities which are
exempt from federal income taxation (“Tax Exempt Partners”) as constituting
Unrelated Business Taxable Income (“UBTI”) within the meaning of the Code,
specifically including, but not limited to, amendments to satisfy the so-called
“fractions rule” contained in Code Section 514(c)(9), the General Partner is
authorized, in its discretion, to amend this Agreement so as to allocate income,
gain, loss, deduction or credit (or items thereof) arising in any year
differently than as provided for in this Section if, and to the extent, that
such amendments will achieve such result or otherwise permit the avoidance of
characterization of Partnership income as UBTI to Tax Exempt Partners.  Any
allocation made pursuant to this Section 5.01(g) shall be deemed to be a
complete substitute for any allocation otherwise provided for in this Agreement,
and no further amendment of this Agreement or approval by any Limited Partner
shall be required to effectuate such allocation.  In making any such allocations
under this Section 5.01(g) (“New Allocations”), the General Partner is
authorized to act in reliance upon advice of counsel to the Partnership or the
Partnership’s regular certified public accountants that, in their opinion, after
examining the relevant provisions of the Code and any current or future proposed
or final Treasury Regulations thereunder, the New Allocation will achieve the
intended result of this Section 5.01(g).

New Allocations made by the General Partner in reliance upon the advice of
counsel or accountants as described above shall be deemed to be made in the best
interests of the Partnership and all of the Partners, and any such New
Allocations shall not give rise to any claim or cause of action by any Partner
against the Partnership or any General Partner.  Nothing herein shall require or
obligate the General Partner, by implication or otherwise, to make any such
amendments or undertake any such action.

5.02        DISTRIBUTIONS OF CASH.

(a)           The Partnership shall distribute cash on a quarterly (or, at the
election of the General Partner, more frequent) basis, in an amount determined
by the General Partner in its sole and absolute discretion, to the Partners who
are Partners on the Partnership Record Date with respect to such quarter (or
other distribution period) in the following manner: (i) first, to the General
Partner in an amount equal to the GP Minimum Return with respect to the fiscal
year of the General Partner; (ii) second, to the Limited Partners pro rata among
them in proportion to the their respective Unpaid Return, if any, owing to each
such Limited Partners with respect to prior fiscal years, in an amount equal to
their respective Unpaid Return for such prior fiscal years owing to each such
Limited Partner; (iii) third, after the establishment of reasonable cash
reserves to meet REIT Expenses and other obligations of the Partnership, as
determined in the sole and absolute discretion of the General Partner, to the
General Partner and the Limited Partners in such aggregate amount as may be
determined by the General Partner in its sole and absolute discretion to be
allocated among the General Partner and the Limited Partners such that each
Limited Partner will receive an amount equal to its LP Return for such fiscal
year; and (iv)

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finally, to the Partners in accordance with and in proportion to their
respective Percentage Interests; provided, however, that if a new or existing
Partner acquires an additional Partnership Interest in exchange for a Capital
Contribution on any date other than a Partnership Record Date, the cash
distribution attributable to such additional Partnership Interest relating to
the Partnership Record Date next following the issuance of such additional
Partnership Interest shall be reduced to the proportion thereof which equals (i)
the number of days that such additional Partnership Interest is held by such
Partner divided by (ii) the number of days between such Partnership Record Date
and the immediately preceding Partnership Record Date.  Notwithstanding the
foregoing, however, the Original Limited Partners may, in their sole and
absolute discretion, elect to defer any distribution to be made to it, in which
case the amount so deferred shall be deemed to be an additional Capital
Contribution made on behalf of the Original Limited Partners under Section
4.02(c) hereof, to be distributed to the Original Limited Partners upon
liquidation of the Partnership under Section 5.06 hereof, or at such time as the
Original Limited Partners may otherwise be allowed to withdraw from the
Partnership after the Transfer Restriction Date.

(b)           Notwithstanding any other provision of this Agreement, the General
Partner is authorized to take any action that it determines to be necessary or
appropriate to cause the Partnership to comply with any withholding requirements
established under the Code or any other federal, state or local law including,
without limitation, the requirements of Sections 1441, 1442, 1445 and 1446 of
the Code.  To the extent that the Partnership is required to withhold and pay
over to any taxing authority any amount resulting from the allocation or
distribution of income to a Partner or its assignee (including by reason of
Section 1446 of the Code), either (i) if the actual amount to be distributed to
the Partner or assignee equals or exceeds the amount required to be withheld by
the Partnership, the amount withheld shall be treated as a distribution of cash
in the amount of such withholding to such Partner or assignee, or (ii) if the
actual amount to be distributed to the Partner or assignee is less than the
amount required to be withheld by the Partnership, the amount required to be
withheld shall be treated as a loan (a “Partnership Loan”) from the Partnership
to the Partner or assignee on the day the Partnership pays over such amount to a
taxing authority.  A Partnership Loan shall be repaid through withholding by the
Partnership with respect to subsequent distributions to the applicable Partner
or assignee.  In the event that a Limited Partner (a “Defaulting Limited
Partner”) fails to pay any amount owed to the Partnership with respect to the
Partnership Loan within 15 days after demand for payment thereof is made by the
Partnership on the Limited Partner, the General Partner, in its sole and
absolute discretion, may elect to make the payment to the Partnership on behalf
of such Defaulting Limited Partner.  In such event, on the date of payment, the
General Partner shall be deemed to have extended a loan (a “General Partner
Loan”) to the Defaulting Limited Partner in the amount of the payment made by
the General Partner and shall succeed to all rights and remedies of the
Partnership against the Defaulting Limited Partner as to that amount.  Without
limitation, the General Partner shall have the right to receive any
distributions that otherwise would be made by the Partnership to the Defaulting
Limited Partner until such time as the General Partner Loan has been paid in
full, and any such distributions so received by the General Partner shall be
treated as having been received by the Defaulting Limited Partner and
immediately paid to the General Partner.  Any amounts treated as a Partnership
Loan or a General Partner Loan pursuant to this Section 5.02(b) shall bear
interest at the lesser of (A) the base rate on corporate loans at large United
States money center commercial banks, as published from time to time in The Wall
Street Journal, or (B) the maximum lawful rate of interest on such

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obligation, such interest to accrue from the date the Partnership or the General
Partner, as applicable, is deemed to extend the loan until such loan is repaid
in full.

(c)           To the extent not utilized for expenses of the Partnership or for
investment in additional Properties, the General Partner may, in its discretion,
cause the Partnership to distribute Net Capital Proceeds in such amount as shall
be determined by the General Partner in its discretion in accordance with the
provisions of Section 5.02(a) hereof.

(d)           In no event may a Partner receive a distribution of cash with
respect to a Partnership Unit if such Partner is entitled to receive a cash
dividend as the holder of record of a REIT Share for which all or part of such
Partnership Unit has been or will be exchanged, and the Unpaid Return with
respect to such Partnership Unit shall be deemed to be reduced by the amount of
any such cash dividend.

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5.03        REIT DISTRIBUTION REQUIREMENTS.  THE GENERAL PARTNER SHALL USE ITS
REASONABLE EFFORTS TO CAUSE THE PARTNERSHIP TO DISTRIBUTE AMOUNTS SUFFICIENT TO
ENABLE THE COMPANY TO PAY STOCKHOLDER DIVIDENDS THAT WILL ALLOW THE COMPANY TO
(A) MEET ITS DISTRIBUTION REQUIREMENT FOR QUALIFICATION AS A REIT AS SET FORTH
IN SECTION 857 OF THE CODE AND (B) AVOID ANY FEDERAL INCOME OR EXCISE TAX
LIABILITY IMPOSED BY THE CODE.

5.04        NO RIGHT TO DISTRIBUTIONS IN KIND.  NO PARTNER SHALL BE ENTITLED TO
DEMAND PROPERTY OTHER THAN CASH IN CONNECTION WITH ANY DISTRIBUTIONS BY THE
PARTNERSHIP.

5.05        LIMITATIONS ON RETURN OF CAPITAL CONTRIBUTIONS.  NOTWITHSTANDING ANY
OF THE PROVISIONS OF THIS ARTICLE V, NO PARTNER SHALL HAVE THE RIGHT TO RECEIVE
AND THE GENERAL PARTNER SHALL NOT HAVE THE RIGHT TO MAKE A DISTRIBUTION THAT
INCLUDES A RETURN OF ALL OR PART OF A PARTNER’S CAPITAL CONTRIBUTIONS, UNLESS
AFTER GIVING EFFECT TO THE RETURN OF A CAPITAL CONTRIBUTION, THE SUM OF ALL
PARTNERSHIP LIABILITIES, OTHER THAN THE LIABILITIES TO A PARTNER FOR THE RETURN
OF ITS CAPITAL CONTRIBUTION, DOES NOT EXCEED THE FAIR MARKET VALUE OF THE
PARTNERSHIP’S ASSETS.

5.06        DISTRIBUTIONS UPON LIQUIDATION.  UPON LIQUIDATION OF THE
PARTNERSHIP, AFTER PAYMENT OF, OR ADEQUATE PROVISION FOR, DEBTS AND OBLIGATIONS
OF THE PARTNERSHIP, INCLUDING ANY PARTNER LOANS, ANY REMAINING ASSETS OF THE
PARTNERSHIP SHALL BE DISTRIBUTED TO ALL PARTNERS WITH POSITIVE CAPITAL ACCOUNTS
IN ACCORDANCE WITH THEIR RESPECTIVE POSITIVE CAPITAL ACCOUNT BALANCES.  FOR
PURPOSES OF THE PRECEDING SENTENCE, THE CAPITAL ACCOUNT OF EACH PARTNER SHALL BE
DETERMINED AFTER ALL ADJUSTMENTS MADE IN ACCORDANCE WITH SECTIONS 5.01 AND 5.02
RESULTING FROM PARTNERSHIP OPERATIONS AND FROM ALL SALES AND DISPOSITIONS OF ALL
OR ANY PART OF THE PARTNERSHIP’S ASSETS HAVE BEEN MADE.  TO THE EXTENT DEEMED
ADVISABLE BY THE GENERAL PARTNER, APPROPRIATE ARRANGEMENTS (INCLUDING THE USE OF
A LIQUIDATING TRUST) MAY BE MADE TO ASSURE THAT ADEQUATE FUNDS ARE AVAILABLE TO
PAY ANY CONTINGENT DEBTS OR OBLIGATIONS.

5.07        SUBSTANTIAL ECONOMIC EFFECT.  IT IS THE INTENT OF THE PARTNERS THAT
THE ALLOCATIONS OF PROFIT AND LOSS UNDER THIS AGREEMENT HAVE SUBSTANTIAL
ECONOMIC EFFECT (OR BE CONSISTENT WITH THE PARTNERS’ INTERESTS IN THE
PARTNERSHIP IN THE CASE OF THE ALLOCATION OF LOSSES ATTRIBUTABLE TO NONRECOURSE
DEBT) WITHIN THE MEANING OF SECTION 704(B) OF THE CODE AS INTERPRETED BY THE
REGULATIONS PROMULGATED PURSUANT THERETO.  ARTICLE V AND OTHER RELEVANT
PROVISIONS OF THIS AGREEMENT SHALL BE INTERPRETED IN A MANNER CONSISTENT WITH
SUCH INTENT.

5.08        WITHHOLDING.

All amounts required to be withheld pursuant to Section 1446 of the Code or any
other provision of federal, state, or local tax law shall be treated as amounts
actually distributed to the affected Partners for all purposes under this
Agreement.  If the Partnership’s withholding obligations with respect to a
Partner shall exceed the cash distributable to such Partner, such Partner shall
be liable for a mandatory capital contribution equal to such excess.  Failure to
make such capital contribution shall result in the deemed sale by such Partner
of a portion of such Partner’s Partnership Interest; such portion having an
agreed value equal to such excess.

5.09        TAX CONSEQUENCES TO LIMITED PARTNERS.

In exercising its authority under this Agreement, the General Partner may, but
shall be under no obligation to, take into account the tax consequences to any
Partner (including the

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General Partner) of any action taken by it. The General Partner and the
Partnership shall not have liability to a Partner under any circumstances as a
result of an income tax liability incurred by such Limited Partner as a result
of an action (or inaction) by the General Partner pursuant to its authority
under this Agreement.

ARTICLE VI

RIGHTS, OBLIGATIONS AND
POWERS OF THE GENERAL PARTNER

6.01        MANAGEMENT OF THE PARTNERSHIP.

(a)           Except as otherwise expressly provided in this Agreement, the
General Partner shall have full, complete and exclusive discretion to manage and
control the business of the Partnership for the purposes herein stated, and
shall make all decisions affecting the business and assets of the Partnership. 
Subject to the restrictions specifically contained in this Agreement, the powers
and obligations, as the context requires, of the General Partner shall include,
without limitation, the authority to take the following actions on behalf of the
Partnership:

(i)            to acquire, purchase, own, operate, lease and dispose of any real
property and any other property or assets including, but not limited to notes,
Mortgages, partnership or joint venture interests or securities, that the
General Partner determines are necessary or appropriate or in the best interests
of the business of the Partnership;

(ii)           to construct buildings and make other improvements on the
Properties owned or leased by the Partnership;

(iii)          to authorize, issue, sell, redeem or otherwise purchase any
Partnership Interests or any securities (including secured and unsecured debt
obligations of the Partnership, debt obligations of the Partnership convertible
into any class or series of Partnership Interests, or options, rights, warrants
or appreciation rights relating to any Partnership Interests) of the
Partnership;

(iv)          to borrow or lend money for the Partnership, issue or receive
evidences of indebtedness in connection therewith, refinance, increase the
amount of, modify, amend or chance the terms of, or extend the time for the
payment of, any such indebtedness, and secure such indebtedness by mortgage,
deed of trust, pledge or other lien on the Partnership’s assets;

(v)           to pay, either directly or by reimbursement, for all operating
costs and general administrative expenses of the Partnership to third parties or
to the Company, the General Partner or any of their Affiliates as set forth in
this Agreement;

(vi)          to guarantee or become a co-maker of indebtedness of the Company
or any Subsidiary thereof, refinance, increase the amount of, modify, amend or
change the terms of, or extend the time for the payment of, any such guarantee
or indebtedness, and secure such guarantee or indebtedness by mortgage, deed of
trust, pledge or other lien on the Partnership’s assets;

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(vii)         to use assets of the Partnership (including, without limitation,
cash on hand) for any purpose consistent with this Agreement, including, without
limitation, payment, either directly or by reimbursement, of all operating costs
and general administrative expenses of the Company, the General Partner, the
Partnership or any Subsidiary of any of them, to third parties or to the Company
or the General Partner as set forth in this Agreement;

(viii)        to lease all or any portion of any of the Partnership’s assets,
whether or not the terms of such leases extend beyond the termination date of
the Partnership and whether or not any portion of the Partnership’s assets so
leased are to be occupied by the lessee, or, in turn, subleased in whole or in
part to others, for such consideration and on such terms as the General Partner
may determine;

(ix)           to prosecute, defend, arbitrate, or compromise any and all claims
or liabilities in favor of or against the Partnership, on such terms and in such
manner as the General Partner may reasonably determine, and similarly, to
prosecute, settle or defend litigation with respect to the Partners, the
Partnership, or the Partnership’s assets;

(x)            to file applications, communicate, and otherwise deal with any
and all governmental agencies having jurisdiction over, or in any way affecting,
the Partnership’s assets or any other aspect of the Partnership business;

(xi)           to make or revoke any election permitted or required of the
Partnership by any taxing authority;

(xii)          to maintain such insurance coverage for public liability, fire
and casualty, and any and all other insurance for the protection of the
Partnership, for the conservation of Partnership assets, or for any other
purpose convenient or beneficial to the Partnership, in such amounts and such
types, as it shall determine from time to time;

(xiii)         to determine whether or not to apply any insurance proceeds for
any Property to the restoration of such Property or to distribute the same;

(xiv)        to establish one or more divisions of the Partnership, to hire and
dismiss employees of the Partnership or any division of the Partnership, and to
retain legal counsel, accountants, consultants, real estate brokers, and such
other persons, as the General Partner may deem necessary or appropriate in
connection with the Partnership business and to pay such persons remuneration as
the General Partner may deem reasonable and proper;

(xv)         to retain other services of any kind or nature in connection with
Partnership business and to pay such remuneration as the General Partner may
deem reasonable and proper for same;

(xvi)        to negotiate and conclude agreements on behalf of the Partnership
with respect to any of the rights, powers and authority conferred upon the
General Partner;

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(xvii)       to maintain accurate accounting records and to file promptly all
federal, state and local income tax returns on behalf of the Partnership;

(xviii)      to distribute Partnership cash or other Partnership assets in
accordance with this Agreement;

(xix)         to form or acquire an interest in, and contribute property to, any
further limited or general partnerships, joint ventures, limited liability
companies or other entities or relationships that it deems desirable (including,
without limitation, the acquisition of interests in, and the contributions of
property to, its Subsidiaries and any other Person in which it has an equity
interest from time to time);

(xx)          to establish Partnership reserves for working capital, capital
expenditures, contingent liabilities, or any other valid Partnership purpose;

(xxi)         to merge, consolidate or combine the Partnership with or into
another Person;

(xxii)        to do any and all acts and things necessary or prudent to ensure
that the Partnership will not be classified as a “publicly traded partnership”
for purposes of Section 7704 of the Code; and

(xxiii)       to take such other action, execute, acknowledge, swear to or
deliver such other documents and instruments, and perform any and all other acts
that the General Partner deems necessary or appropriate for the formation,
continuation and conduct of the business and affairs of the Partnership
(including, without limitation, all actions consistent with allowing the Company
at all times to qualify as a REIT unless the Company voluntarily terminates its
REIT status) and to possess and enjoy all of the rights and powers of a general
partner as provided by the Act.

(b)           Except as otherwise provided herein, to the extent the duties of
the General Partner require expenditures of funds to be paid to third parties,
the General Partner shall not have any obligations hereunder except to apply
Partnership funds to the extent that Partnership funds are reasonably available
to it for the performance of such duties, and nothing herein contained shall be
deemed to authorize or require the General Partner, in its capacity as such, to
expend its individual funds for payment to third parties or to undertake any
individual liability or obligation on behalf of the Partnership.

(c)           Any actions taken by the General Partner pursuant to its authority
under this Agreement on behalf of the Partnership regarding the approval of any
transaction between the Partnership and the Sponsor, Advisor, a member of the
Board of Directors of the Company or any Affiliate thereof, shall require
approval by a majority of the members of the Board of Directors of the Company
(including a majority of the independent directors) not otherwise interested in
such transaction as being fair and reasonable to the Company and the Partnership
on terms and conditions not less favorable to the Company or the Partnership, as
applicable, than those available from unaffiliated third parties.

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6.02        DELEGATION OF AUTHORITY.  THE GENERAL PARTNER MAY DELEGATE ANY OR
ALL OF ITS POWERS, RIGHTS AND OBLIGATIONS HEREUNDER, AND MAY APPOINT, EMPLOY,
CONTRACT OR OTHERWISE DEAL WITH ANY PERSON (INCLUDING WITHOUT LIMITATION
OFFICERS OR OTHER AGENTS OF THE PARTNERSHIP, THE COMPANY OR THE GENERAL PARTNER
APPOINTED BY THE GENERAL PARTNER) FOR THE TRANSACTION OF THE BUSINESS OF THE
PARTNERSHIP, WHICH PERSON MAY, UNDER SUPERVISION OF THE GENERAL PARTNER, PERFORM
ANY ACTS OR SERVICES FOR THE PARTNERSHIP AS THE GENERAL PARTNER MAY APPROVE.

6.03        INDEMNIFICATION AND EXCULPATION OF INDEMNITEES.

(a)           The Partnership shall indemnify an Indemnitee from and against any
and all losses, claims, damages, liabilities, joint or several, expenses
(including reasonable legal fees and expenses), judgments, fines, settlements,
and other amounts arising from any and all claims, demands, actions, suits or
proceedings, civil, criminal, administrative or investigative, that relate to
the operations of the Partnership as set forth in this Agreement in which any
Indemnitee may be involved, or is threatened to be involved, as a party or
otherwise, as a result of acting on behalf of or performing services for the
Partnership, only if it is determined that (i) the Indemnitee acted in good
faith and (ii) that the Indemnitee reasonably believed that the act or omission
was in the Partnership’s best interests, or if the act or omission was outside
the Indemnitee’s official capacity as a general partner of the Partnership, that
the act or omission was at least not opposed to the Partnership’s best
interests.  Notwithstanding the foregoing, each Indemnitee shall be liable,
responsible and accountable, and the Partnership shall not be liable to an
Indemnitee, other than for reasonable expenses actually incurred by the
Indemnitee with respect to a proceeding in which (i) the Indemnitee is found
liable on the basis that the Indemnitee improperly received personal benefit,
whether or not the benefit resulted from an action taken in the Indemnitee’s
official capacity, or (ii) the Indemnitee is found liable to the Partnership or
the Limited Partners.  The Partnership shall not indemnify or hold harmless the
Indemnitee:  (a) in the case in which the Indemnitee is an Independent 
Director, if the loss or liability was the result of gross negligence or willful
misconduct by the Indemnitee, or (b) in any other case, if the loss or liability
was the result of negligence or misconduct by the Indemnitee.  The termination
of any proceeding by judgment, order or settlement does not create a presumption
that the Indemnitee did not meet the requisite standard of conduct set forth in
this Section 6.03(a).  The termination of any proceeding by conviction or upon a
plea of nolo contendere or its equivalent, or an entry of an order of probation
prior to judgment, does not alone determine that the Indemnitee acted in a
manner contrary to that specified in this Section 6.03(a).  Any indemnification
pursuant to this Section 6.03 shall be made only out of the assets of the
Partnership.

(b)           Notwithstanding anything to the contrary contained in the
provisions of subsection (a) of this Section, the Partnership shall not provide
indemnification for any loss, liability or expense arising from or out of an
alleged violation of federal or state securities laws by an Indemnitee unless
one or more of the following conditions are met:  (i) there has been a
successful adjudication on the merits of each count involving alleged securities
law violations as to the particular Indemnitee, (ii) such claims have been
dismissed with prejudice on the merits by a court of competent jurisdiction as
to the particular Indemnitee, or (iii) a court of competent jurisdiction
approves a settlement of the claims against a particular Indemnitee and finds
that indemnification of the settlement and the related costs should be made, and
the court considering the request for indemnification has been advised of the
position of the SEC and of the published

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position of any state securities regulatory authority in which securities of the
Partnership were offered or sold as to indemnification for violations of
securities laws.

(c)           The Partnership shall pay or reimburse reasonable legal expenses
and other costs incurred by an Indemnitee in advance of final disposition of a
proceeding if all of the following are satisfied:  (i) the proceeding relates to
acts or omissions with respect to the performance of duties for services on
behalf of the Partnership, (ii) the Indemnitee provides the Partnership with
written affirmation of the Indemnitee’s good faith belief that the Indemnitee
has met the standard of conduct necessary for indemnification by the Partnership
as authorized in this Section 6.03, (iii) the legal proceeding was initiated by
a third party who is not a stockholder of the Company or, if by a stockholder of
the Company acting in his or her capacity as such, a court of competent
jurisdiction approves such advancement, and (iv) the Indemnitee provides the
Partnership with a written agreement to repay the amount paid or reimbursed by
the Partnership, together with the applicable legal rate of interest thereon, if
it is ultimately determined that the Indemnitee did not comply with the
requisite standard of conduct and is not entitled to indemnification.

(d)           The Indemnification provided by this Section 6.03 shall be in
addition to any other rights to which an Indemnitee or any other Person may be
entitled under any agreement, pursuant to any vote of the Partners, as a matter
of law or otherwise, and shall continue as to an Indemnitee who has ceased to
serve in such capacity.

(e)           The Partnership may purchase and maintain insurance or establish
other arrangements, including without limitation trust arrangements and letters
of credit on behalf of or to secure indemnification obligations owed to the
Indemnitees and such other Persons as the General Partner shall determine
against any liability that may be asserted against or expenses that may be
incurred by such Person in connection with the Partnership’s activities,
regardless of whether the Partnership would have the power to indemnify such
Person against such liability under the provisions of this Agreement.

(f)            For purposes of this Section 6.03, (i) the Partnership shall be
deemed to have requested an Indemnitee to serve as a fiduciary of an employee
benefit plan whenever the performance by the Indemnitee of its duties to the
Partnership also imposes duties on the Indemnitee, or otherwise involves
services by the Indemnitee to the plan or participants or beneficiaries of the
plan; (ii) excise taxes assessed on an Indemnitee with respect to an employee
benefit plan pursuant to applicable law shall constitute fines within the
meaning of this Section 6.03; and (iii) actions taken or omitted by the
Indemnitee with respect to an employee benefit plan in the performance of its
duties for a purpose reasonably believed by it to be in the interest of the
participants and beneficiaries of the plan shall be deemed to be for a purpose
which is not opposed to the best interests of the Partnership.

(g)           In no event may an Indemnitee subject the Limited Partners to
personal liability by reason of the indemnification provisions set forth in this
Agreement.

(h)           An Indemnitee shall not be denied indemnification in whole or in
part under this Section 6.03 because the Indemnitee had an interest in the
transaction with respect to which the indemnification applies if the transaction
was otherwise permitted by the terms of this Agreement.

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(i)            The provisions of this Section 6.03 are for the benefit of the
Indemnitees, their heirs, successors, assigns and administrators and shall not
be deemed to create any rights in or be for the benefit of any other Persons.

6.04        LIABILITY OF THE GENERAL PARTNER.

(a)           Notwithstanding anything to the contrary set forth in this
Agreement, the General Partner shall not be liable for monetary damages to the
Partnership or any Partners for losses sustained or liabilities incurred as a
result of errors in judgment or any act or omission if the General Partner acted
in good faith.  The General Partner shall not be in breach of any duty that the
General Partner may owe to the Limited Partners or the Partnership or any other
Persons under this Agreement or of any duty stated or implied by law or equity,
provided, the General Partner, acting in good faith, abides by the terms of this
Agreement.  In addition, to the extent the General Partner or any officer,
director, employee, agent or stockholder of the General Partner performs its
duties in accordance with the standards provided by the Act, as it may be
amended from time to time, or under any successor statute thereto, such Person
or Persons shall have no liability by reason of being or having been the General
Partner, or by reason of being an officer, director, employee, agent or
stockholder of the General Partner.  To the maximum extent that the Act and the
general laws of the State of Texas, in effect from time to time, permit
limitation of the liability of general partners of a limited partnership, the
General Partner and its officers, directors, employees, agents and stockholders
shall not be liable to the Partnership or to any Partner for money damages
except to the extent that (i) the General Partner or its officers, directors,
employees, agents or stockholders actually received an improper benefit or
profit in money, property or services, in which case the liability shall not
exceed the amount of the benefit or profit in money, property or services
actually received; or (ii) a judgment or other final adjudication adverse to the
General Partner or one or more of its officers, directors, employees, agents or
stockholders is entered in a proceeding based on a finding in the proceeding
that the action or failure to act of the General Partner or one or more of its
officers, directors, employees, agents or stockholders was the result of active
and deliberate dishonesty and was material to the cause of action adjudicated in
the proceeding.  Neither the amendment nor repeal of this Section 6.04(a), nor
the adoption or amendment of any other provision of this Agreement inconsistent
with this Section 6.04(a), shall apply to or affect in any respect the
applicability of the preceding sentence with respect to any act or failure to
act which occurred prior to such amendment, repeal or adoption.  In the absence
of any Texas statute limiting the liability of the General Partner or its
directors or officers for money damages in a suit by or on behalf of the
Partnership or by any Partner, the General Partner and the officers, directors,
employees, agents and stockholders of the General Partner shall not be liable to
the Partnership or to any Partner for money damages except to the extent that
(i) the General Partner or one or more of its officers, directors, employees,
agents or stockholders actually received an improper benefit or profit in money,
property or services, in which case the liability shall not exceed the amount of
the benefit or profit in money, property or services actually received; or (ii)
a judgment or other final adjudication adverse to the General Partner or one or
more of its officers, directors, employees, agents or stockholders is entered in
a proceeding based on a finding in the proceeding that the action of the General
Partner or one or more of its officers, directors, employees or stockholders
action or failure to act was the result of active and deliberate dishonesty and
was material to the cause of action adjudicated in the proceeding.

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(b)           The Limited Partners expressly acknowledge that the General
Partner is acting on behalf of the Partnership, itself and its stockholders
collectively, that the General Partner is under no obligation to consider the
separate interests of the Limited Partners (including, without limitation, the
tax consequences to Limited Partners or the tax consequences of some, but not
all, of the Limited Partners) in deciding whether to cause the Partnership to
take (or decline to take) any actions.  In the event of a conflict between the
interests of its stockholders on the one hand and the Limited Partners on the
other, the General Partner shall endeavor in good faith to resolve the conflict
in a manner not adverse to either its stockholders or the Limited Partners;
provided, however, that for so long as the General Partner directly owns a
controlling interest in the Partnership, any such conflict that the General
Partner, in its sole and absolute discretion, determines cannot be resolved in a
manner not adverse to either its stockholders or the Limited Partners shall be
resolved in favor of its stockholders.  The General Partner shall not be liable
for monetary damages for losses sustained, liabilities incurred, or benefits not
derived by Limited Partners in connection with such decisions, provided that the
General Partner has acted in good faith.

(c)           Subject to its obligations and duties as General Partner set forth
in Section 6.01 hereof, the General Partner may exercise any of the powers
granted to it under this Agreement and perform any of the duties imposed upon it
hereunder either directly or by or through its agents.  The General Partner
shall not be responsible for any misconduct or negligence on the part of any
such agent appointed by it in good faith.

(d)           Notwithstanding any other provisions of this Agreement or the Act,
any action of the General Partner on behalf of the Partnership or any decision
of the General Partner to refrain from acting on behalf of the Partnership,
undertaken in the good faith belief that such action or omission is necessary or
advisable in order to (i) protect the ability of the Company to continue to
qualify as a REIT or (ii) prevent the Company from incurring any taxes under
Section 857, Section 4981, or any other provision of the Code, is expressly
authorized under this Agreement and is deemed approved by all of the Limited
Partners.

(e)           Any amendment, modification or repeal of this Section 6.04 or any
provision hereof shall be prospective only and shall not in any way affect the
limitations on the General Partner’s liability to the Partnership and the
Limited Partners under this Section 6.04 as in effect immediately prior to such
amendment, modification or repeal with respect to matters occurring, in whole or
in part, prior to such amendment, modification or repeal, regardless of when
claims relating to such matters may arise or be asserted.

6.05        REIMBURSEMENT OF OR BY GENERAL PARTNER.

(a)           Except as provided in this Section 6.05 and elsewhere in this
Agreement (including the provisions of Articles V and VI regarding
distributions, payments, and allocations to which it may be entitled), the
General Partner shall not be compensated for its services as general partner of
the Partnership.

(b)           The General Partner shall be reimbursed by the Partnership on a
monthly basis, or such other basis as the General Partner may determine in its
sole and absolute discretion, for all REIT Expenses and Administrative Expenses
incurred by the General Partner.

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(c)           The Company shall be reimbursed by the Partnership on a monthly
basis, or such other basis as the General Partner may determine in its sole and
absolute discretion, for all REIT Expenses and Administrative Expenses incurred
by the Company.

6.06        OUTSIDE ACTIVITIES.  SUBJECT TO THE ARTICLES OF INCORPORATION AND
ANY AGREEMENTS ENTERED INTO BY THE GENERAL PARTNER OR ITS AFFILIATES WITH THE
PARTNERSHIP OR A SUBSIDIARY, OR ANY OFFICER, DIRECTOR, MANAGER, EMPLOYEE, AGENT,
TRUSTEE, AFFILIATE OR OWNER OF THE GENERAL PARTNER, THE AFFILIATES OF THE
GENERAL PARTNER AND THE OFFICERS, DIRECTORS, MANAGERS, AGENTS, TRUSTEES AND
OWNERS OF THE GENERAL PARTNER AND ITS AFFILIATES SHALL BE ENTITLED TO AND MAY
HAVE BUSINESS INTERESTS AND ENGAGE IN BUSINESS ACTIVITIES IN ADDITION TO THOSE
RELATING TO THE PARTNERSHIP, INCLUDING BUSINESS INTERESTS AND ACTIVITIES
SUBSTANTIALLY SIMILAR OR IDENTICAL TO THOSE OF THE PARTNERSHIP.  NEITHER THE
PARTNERSHIP NOR ANY OF THE LIMITED PARTNERS SHALL HAVE ANY RIGHTS BY VIRTUE OF
THIS AGREEMENT IN ANY SUCH BUSINESS VENTURES, INTERESTS OR ACTIVITIES.  NONE OF
THE LIMITED PARTNERS OR ANY OTHER PERSON SHALL HAVE ANY RIGHTS BY VIRTUE OF THIS
AGREEMENT OR THE PARTNERSHIP RELATIONSHIP ESTABLISHED HEREBY IN ANY SUCH
BUSINESS VENTURES, INTERESTS OR ACTIVITIES, AND NEITHER THE GENERAL PARTNER, NOR
ANY AFFILIATES OF THE GENERAL PARTNER NOR ANY OFFICERS, DIRECTORS, MANAGERS,
EMPLOYEES, AGENTS, TRUSTEES OR OWNERS OF THE GENERAL PARTNER OR THE GENERAL
PARTNER’S AFFILIATES SHALL HAVE ANY OBLIGATION PURSUANT TO THIS AGREEMENT TO
OFFER ANY INTEREST IN ANY SUCH BUSINESS VENTURES, INTERESTS AND ACTIVITIES TO
THE PARTNERSHIP OR ANY LIMITED PARTNER, EVEN IF SUCH OPPORTUNITY IS OF A
CHARACTER WHICH, IF PRESENTED TO THE PARTNERSHIP OR ANY LIMITED PARTNER, COULD
BE TAKEN BY SUCH PERSON.  WITHOUT THE CONSENT OF THE LIMITED PARTNERS HOLDING
MORE THAN 50% OF THE PERCENTAGE INTERESTS, THE GENERAL PARTNER SHALL NOT,
DIRECTLY OR INDIRECTLY, ENTER INTO OR CONDUCT ANY BUSINESS, OTHER THAN IN
CONNECTION WITH THE OWNERSHIP, ACQUISITION AND DISPOSITION OF PARTNERSHIP
INTERESTS AS A GENERAL PARTNER AND THE MANAGEMENT OF THE BUSINESS OF THE
PARTNERSHIP, THE FACILITATION OF THE COMPANY’S OPERATION AS A REIT AND SUCH
ACTIVITIES AS ARE INCIDENTAL TO THE SAME.  WITHOUT THE CONSENT OF THE LIMITED
PARTNERS HOLDING MORE THAN 50% OF THE UNAFFILIATED PERCENTAGE INTERESTS (IF
ANY), NEITHER THE GENERAL PARTNER NOR THE COMPANY SHALL, DIRECTLY OR INDIRECTLY,
PARTICIPATE IN OR OTHERWISE ACQUIRE ANY INTEREST IN ANY REAL OR PERSONAL
PROPERTY, EXCEPT ITS GENERAL PARTNER INTEREST OR ITS MINORITY INTEREST IN ANY
SUBSIDIARY OF THE PARTNERSHIP (HELD DIRECTLY OR INDIRECTLY THROUGH A QUALIFIED
REIT SUBSIDIARY (AS DEFINED IN CODE SECTION 856(I)(2), LIMITED LIABILITY COMPANY
OR TAXABLE CORPORATE AFFILIATE, AS THE COMPANY SHALL DETERMINE CONSISTENT WITH
ITS NEED TO MAINTAIN ITS STATUS AS A REIT) THAT THE GENERAL PARTNER HOLDS IN
ORDER TO MAINTAIN SUCH SUBSIDIARY’S STATUS AS A PARTNERSHIP FOR FEDERAL INCOME
TAX PURPOSE OR TO SATISFY ANY COVENANTS OR TERMS OF ANY DOCUMENTS EVIDENCING A
LOAN THAT IS EITHER MADE TO SUCH SUBSIDIARY OR THAT RELATES TO ANY PROPERTY
OWNED DIRECTLY OR INDIRECTLY BY SUCH SUBSIDIARY, AND SUCH BANK ACCOUNTS, SIMILAR
INSTRUMENTS OR OTHER SHORT TERM INVESTMENTS AS IT DEEMS NECESSARY TO CARRY OUT
ITS RESPONSIBILITIES CONTEMPLATED UNDER THIS AGREEMENT AND THE CERTIFICATE.

6.07        EMPLOYMENT OR RETENTION OF AFFILIATES.

(a)           Any Affiliate of the General Partner may be employed or retained
by the Partnership and may otherwise deal with the Partnership (whether as an
advisor, buyer, lessor, lessee, manager, property management agent, asset
manager, furnisher of goods or services, broker, agent, lender or otherwise) and
may receive from the Partnership any compensation, price, or other payment
therefor which the General Partner determines to be fair and reasonable.

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(b)           The Partnership may lend or contribute to its Subsidiaries or
other Persons in which it has an equity investment, and such Persons may borrow
funds from the Partnership, on terms and conditions established in the sole and
absolute discretion of the General Partner.  The foregoing authority shall not
create any right or benefit in favor of any Subsidiary or any other Person.

(c)           The Partnership may transfer assets to joint ventures, limited
liability companies, other partnerships, corporations or other business entities
in which it is or thereby becomes a participant upon such terms and subject to
such conditions as the General Partner deems to be consistent with this
Agreement and applicable law.

(d)           Except as expressly permitted by this Agreement, neither the
General Partner nor any of its Affiliates shall sell, transfer or convey any
property to, or purchase any property from, the Partnership, directly or
indirectly, except pursuant to transactions that are on terms that are fair and
reasonable to the Partnership.

6.08        RESERVED.

6.09        TITLE TO PARTNERSHIP ASSETS.  PARTNERSHIP ASSETS, WHETHER REAL,
PERSONAL OR MIXED AND WHETHER TANGIBLE OR INTANGIBLE, SHALL BE DEEMED TO BE
OWNED BY THE PARTNERSHIP AS AN ENTITY, AND NO PARTNER, INDIVIDUALLY OR
COLLECTIVELY, SHALL HAVE ANY OWNERSHIP INTEREST IN SUCH PARTNERSHIP ASSETS OR
ANY PORTION THEREOF; PROVIDED, THAT TITLE TO ANY OR ALL OF THE PARTNERSHIP
ASSETS MAY BE HELD IN THE NAME OF THE PARTNERSHIP, THE GENERAL PARTNER OR ONE OR
MORE NOMINEES, AS THE GENERAL PARTNER MAY DETERMINE, INCLUDING AFFILIATES OF THE
GENERAL PARTNER.  THE GENERAL PARTNER HEREBY DECLARES AND WARRANTS THAT ANY
PARTNERSHIP ASSETS FOR WHICH LEGAL TITLE IS HELD IN THE NAME OF THE GENERAL
PARTNER OR ANY NOMINEE OR AFFILIATE OF THE GENERAL PARTNER SHALL BE HELD BY SUCH
PERSON FOR THE USE AND BENEFIT OF THE PARTNERSHIP IN ACCORDANCE WITH THE
PROVISIONS OF THIS AGREEMENT; PROVIDED, THAT THE GENERAL PARTNER SHALL USE ITS
BEST EFFORTS TO CAUSE LEGAL TITLE TO SUCH ASSETS TO BE VESTED IN THE PARTNERSHIP
AS SOON AS REASONABLY PRACTICABLE.  ALL PARTNERSHIP ASSETS SHALL BE RECORDED AS
THE PROPERTY OF THE PARTNERSHIP IN ITS BOOKS AND RECORDS, IRRESPECTIVE OF THE
NAME IN WHICH LEGAL TITLE TO SUCH PARTNERSHIP ASSETS IS HELD.

6.10        MISCELLANEOUS.  IN THE EVENT THE COMPANY REDEEMS ANY REIT SHARES,
THEN THE PARTNERSHIP WILL BE DEEMED TO HAVE PURCHASED FROM THE ORIGINAL LIMITED
PARTNERS A NUMBER OF PARTNERSHIP UNITS DETERMINED BY, AND BASED UPON, THE
APPLICATION OF THE CONVERSION FACTOR ON THE SAME TERMS UPON WHICH THE COMPANY
REDEEMED SUCH REIT SHARES.  MOREOVER, IF THE COMPANY MAKES A CASH TENDER OFFER
OR OTHER OFFER TO ACQUIRE REIT SHARES, THEN THE COMPANY SHALL BE DEEMED TO HAVE
MADE A CORRESPONDING OFFER TO THE ORIGINAL LIMITED PARTNERS TO ACQUIRE AN
EQUIVALENT NUMBER OF PARTNERSHIP UNITS HELD BY THE ORIGINAL LIMITED PARTNERS
BASED ON THE APPLICATION OF THE CONVERSION FACTOR.  IN THE EVENT ANY REIT SHARES
ARE REDEEMED BY THE COMPANY PURSUANT TO SUCH CASH TENDER OFFER, THEN THE
PARTNERSHIP SHALL BE DEEMED TO HAVE REDEEMED AN EQUIVALENT NUMBER OF THE
ORIGINAL LIMITED PARTNERS’ PARTNERSHIP UNITS FOR AN EQUIVALENT PURCHASE PRICE
BASED ON THE APPLICATION OF THE CONVERSION FACTOR.  IF THE ORIGINAL LIMITED
PARTNERS HOLD AN INSUFFICIENT NUMBER OF PARTNERSHIP UNITS TO EFFECT A PURCHASE
OR REDEMPTION CONTEMPLATED BY THIS SECTION 6.10, THEN THE PARTNERSHIP WILL BE
DEEMED TO HAVE PURCHASED OR REDEEMED FROM THE GENERAL PARTNER, AFTER IT HAS
PURCHASED OR REDEEMED ALL OF THE

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ORIGINAL LIMITED PARTNERS’ PARTNERSHIP UNITS, THE NUMBER OF PARTNERSHIP UNITS
NECESSARY TO EFFECT SUCH PURCHASE OR REDEMPTION.

ARTICLE VII

TRANSFERS OF GENERAL PARTNERSHIP INTERESTS

7.01        TRANSFERS OF GENERAL PARTNERSHIP INTERESTS.

(a)           The General Partner shall not transfer all or any portion of its
General Partnership Interest or withdraw as General Partner except as provided
in or in connection with a transaction contemplated by Sections 7.01(c), 7.01(d)
or 7.01(e).

(b)           The Company shall not transfer all or any portion of its interest
in the General Partner except as provided in or in connection with a transaction
contemplated by Sections 7.01(c), 7.01(d) or 7.01(e).

(c)           Except as otherwise provided in Sections 7.01(d) or (e) hereof,
neither the Company nor the General Partner shall engage in any merger,
consolidation or other combination with or into another Person or sale of all or
substantially all of its assets (other than in connection with a change in the
Company’s or the General Partner’s state of incorporation or organizational
form), which, in any such case, results in a change of control of the Company or
the General Partner (a “Transaction”), unless:

(i)            the consent of Limited Partners holding more than 50% of the
Percentage Interests of the Limited Partners is obtained; or

(ii)           as a result of such Transaction all Limited Partners are granted
the right to receive for each Partnership Unit an amount of cash, securities, or
other property equal to the product of the Conversion Factor and the greatest
amount of cash, securities or other property paid in the Transaction to a holder
of one REIT Share in consideration of the transfer of one REIT Share; provided,
that if, in connection with the Transaction, a purchase, tender or exchange
offer (“Offer”) shall have been made to and accepted by the holders of more than
50% of the outstanding REIT Shares, each holder of Partnership Units shall be
given the option to exchange its Partnership Units for the greatest amount of
cash, securities, or other property which a Limited Partner would have received
had it (A) exercised its Exchange Right and (B) sold, tendered or exchanged
pursuant to the Offer the REIT Shares received upon exercise of the Exchange
Right immediately prior to the expiration of the Offer; or

(iii)          the Company or the General Partner is the surviving entity in the
Transaction and either (A) the holders of REIT Shares in the case of a
Transaction involving the Company, or the Company in the case of a Transaction
involving the General Partner, do not receive cash, securities, or other
property in the Transaction or (B) all Limited Partners (other than the General
Partner or any Subsidiary) receive an amount of cash, securities, or other
property (expressed as an amount per REIT Share) that is no less than the
product of the Conversion Factor and the greatest amount of cash, securities, or
other property (expressed as an amount per REIT Share) received in the

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Transaction by any holder of REIT Shares in the case of a Transaction involving
the Company, or the Company in the case of a Transaction involving the General
Partner.

(d)           Notwithstanding Section 7.01(c), either the Company or the General
Partner may merge with or into or consolidate with another entity if immediately
after such merger or consolidation (i) substantially all of the assets of the
successor or surviving entity (the “Survivor”), other than Partnership Units
held by the General Partner, are contributed, directly or indirectly, to the
Partnership as a Capital Contribution in exchange for Partnership Units with a
fair market value equal to the value of the assets so contributed as determined
by the Survivor in good faith and (ii) the Survivor expressly agrees to assume
all obligations of the General Partner, as appropriate, hereunder.  Upon such
contribution and assumption, the Survivor shall have the right and duty to amend
this Agreement as set forth in this Section 7.01(d).  The Survivor shall in good
faith arrive at a new method for the calculation of the Cash Amount, the REIT
Shares Amount and the Conversion Factor for a Partnership Unit after any such
merger or consolidation so as to approximate the existing method for such
calculation as closely as reasonably possible.  Such calculation shall take into
account, among other things, the kind and amount of securities, cash and other
property that was receivable upon such merger or consolidation by a holder of
REIT Shares or options, warrants or other rights relating thereto, and which a
holder of Partnership Units could have acquired had such Partnership Units been
exchanged immediately prior to such merger or consolidation.  Such amendment to
this Agreement shall provide for adjustments to such method of calculation,
which shall be as nearly equivalent as may be practicable to the adjustments
provided for herein with respect to the Conversion Factor.  The Survivor also
shall in good faith modify the definition of REIT Shares and make such
amendments to Section 8.05 hereof so as to approximate the existing rights and
obligations set forth in Section 8.05 as closely as reasonably possible.  The
above provisions of this Section 7.01(d) shall similarly apply to successive
mergers or consolidations permitted hereunder.

In respect of any transaction described in the preceding paragraph, the General
Partner is required to use its commercially reasonable efforts to structure such
transaction to avoid causing the Limited Partners to recognize a gain for
federal income tax purposes by virtue of the occurrence of or their
participation in such transaction, provided, such efforts are consistent with
the exercise of the Board of Directors’ fiduciary duties to the stockholders of
the General Partner under applicable law.

(e)           Notwithstanding Section 7.01(c),

(i)            a General Partner may transfer all or any portion of its General
Partnership Interest to (A) a wholly-owned Subsidiary of such General Partner or
(B) the owner of all of the ownership interests of such General Partner, and
following a transfer of all of its General Partnership Interest, may withdraw as
General Partner; and

(ii)           the General Partner or the Company may engage in a transaction
not required by law or by the rules of any national securities exchange on which
the REIT Shares are listed to be submitted to the vote of the holders of the
REIT Shares.

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7.02        ADMISSION OF A SUBSTITUTE OR ADDITIONAL GENERAL PARTNER.  A PERSON
SHALL BE ADMITTED AS A SUBSTITUTE OR ADDITIONAL GENERAL PARTNER OF THE
PARTNERSHIP ONLY IF THE FOLLOWING TERMS AND CONDITIONS ARE SATISFIED:

(a)           the Person to be admitted as a substitute or additional General
Partner shall have accepted and agreed to be bound by all the terms and
provisions of this Agreement by executing a counterpart hereof and such other
documents or instruments as may be required or appropriate in order to effect
the admission of such Person as a General Partner, a certificate evidencing the
admission of such Person as a General Partner shall have been filed for
recordation and all other actions required by Section 2.05 hereof in connection
with such admission shall have been performed;

(b)           if the Person to be admitted as a substitute or additional General
Partner is a corporation or a partnership, it shall have provided the
Partnership with evidence satisfactory to counsel for the Partnership of such
Person’s authority to become a General Partner and to be bound by the terms and
provisions of this Agreement; and

(c)           counsel for the Partnership shall have rendered an opinion
(relying on such opinions from other counsel in the state or any other
jurisdiction as may be necessary) that the admission of the Person to be
admitted as a substitute or additional General Partner is in conformity with the
Act, and that none of the actions taken in connection with the admission of such
Person as a substitute or additional General Partner will cause (i) the
Partnership to be classified other than as a partnership for federal income tax
purposes, or (ii) the loss of any Limited Partner’s limited liability.

7.03        EFFECT OF BANKRUPTCY, WITHDRAWAL, DEATH OR DISSOLUTION OF A GENERAL
PARTNER.

(a)           Upon the occurrence of an Event of Bankruptcy as to a General
Partner (and its removal pursuant to Section 7.04(a) hereof) or the death,
withdrawal, removal or dissolution of a General Partner (except that, if a
General Partner is, on the date of such occurrence a partnership, the
withdrawal, death, dissolution, Event of Bankruptcy as to, or removal of a
partner in, such partnership shall be deemed not to be a dissolution of such
General Partner if the business of such General Partner is continued by the
remaining partner or partners thereof), the Partnership shall be dissolved and
terminated unless the Partnership is continued pursuant to Section 7.03(b)
hereof.  The merger of the General Partner with or into any entity that is
admitted as a substitute or successor General Partner pursuant to Section 7.02
hereof shall not be deemed to be the withdrawal, dissolution or removal of the
General Partner.

(b)           Following the occurrence of an Event of Bankruptcy as to a General
Partner (and its removal pursuant to Section 7.04(a) hereof) or the death,
withdrawal, removal or dissolution of a General Partner (except that, if a
General Partner is, on the date of such occurrence a partnership, the
withdrawal, death, dissolution, Event of Bankruptcy as to, or removal of a
partner in, such partnership shall be deemed not to be a dissolution of such
General Partner if the business of such General Partner is continued by the
remaining partner or partners thereof), the Limited Partners, within 90 days
after such occurrence, may elect to continue the business of the Partnership for
the balance of the term specified in Section 2.04 hereof by selecting, subject
to Section 7.02 hereof and any other provisions of this Agreement, a substitute
General Partner by

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consent of a majority in interest of the Limited Partners.  If the Limited
Partners elect to continue the business of the Partnership and admit a
substitute General Partner, the relationship with the Partners and of any Person
who has acquired an interest of a Partner in the Partnership shall be governed
by this Agreement.

7.04        REMOVAL OF A GENERAL PARTNER.

(a)           Upon the occurrence of an Event of Bankruptcy as to, or the
dissolution of, a General Partner, such General Partner shall be deemed to be
removed automatically; provided, however, that if a General Partner is on the
date of such occurrence a partnership, the withdrawal, death, dissolution, Event
of Bankruptcy as to or removal of a partner in such partnership shall be deemed
not to be a dissolution of the General Partner if the business of such General
Partner is continued by the remaining partner or partners thereof.  The Limited
Partners may not remove the General Partner, with or without cause.

(b)           If a General Partner has been removed pursuant to this Section
7.04 and the Partnership is continued pursuant to Section 7.03 hereof, such
General Partner shall promptly transfer and assign its General Partnership
Interest in the Partnership to the substitute General Partner approved by a
majority in interest of the Limited Partners in accordance with Section 7.03(b)
hereof and otherwise admitted to the Partnership in accordance with Section 7.02
hereof.  At the time of assignment, the removed General Partner shall be
entitled to receive from the substitute General Partner the fair market value of
the General Partnership Interest of such removed General Partner as reduced by
any damages caused to the Partnership by such General Partner’s removal.  Such
fair market value shall be determined by an appraiser mutually agreed upon by
the General Partner and Limited Partners holding more than 50% of the Percentage
Interests of the Limited Partners within 10 days following the removal of the
General Partner.  In the event that the parties are unable to agree upon an
appraiser, the removed General Partner and Limited Partners holding more than
50% of the Percentage Interests of the Limited Partners shall each select an
appraiser.  Each such appraiser shall complete an appraisal of the fair market
value of the removed General Partner’s General Partnership Interest within 30
days of the General Partner’s removal, and the fair market value of the removed
General Partner’s General Partnership Interest shall be the average of the two
appraisals; provided, however, that if the higher appraisal exceeds the lower
appraisal by more than 20% of the amount of the lower appraisal, the two
appraisers, no later than 40 days after the removal of the General Partner,
shall select a third appraiser who shall complete an appraisal of the fair
market value of the removed General Partner’s General Partnership Interest no
later than 60 days after the removal of the General Partner.  In such case, the
fair market value of the removed General Partner’s General Partnership Interest
shall be the average of the two appraisals closest in value.

(c)           The General Partnership Interest of a removed General Partner,
during the time after removal until the date of transfer under Section 7.04(b),
shall be converted to that of a special Limited Partner; provided, however, such
removed General Partner shall not have any rights to participate in the
management and affairs of the Partnership, and shall not be entitled to any
portion of the income, expense, Profit, gain or Loss allocations or cash
distributions allocable or payable, as the case may be, to the Limited
Partners.  Instead, such removed General Partner shall receive and be entitled
only to retain distributions or allocations of such items that it

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would have been entitled to receive in its capacity as General Partner, until
the transfer is effective pursuant to Section 7.04(b).

(d)           All Partners shall have given and hereby do give such consents,
shall take such actions and shall execute such documents as shall be legally
necessary and sufficient to effect all the foregoing provisions of this Section
7.04.

ARTICLE VIII

RIGHTS AND OBLIGATIONS
OF THE LIMITED PARTNERS

8.01        MANAGEMENT OF THE PARTNERSHIP.  THE LIMITED PARTNERS SHALL NOT
PARTICIPATE IN THE MANAGEMENT OR CONTROL OF PARTNERSHIP BUSINESS NOR SHALL THEY
TRANSACT ANY BUSINESS FOR OR ON BEHALF OF THE PARTNERSHIP, NOR SHALL THEY HAVE
THE POWER TO SIGN FOR OR BIND THE PARTNERSHIP, SUCH POWERS BEING VESTED SOLELY
AND EXCLUSIVELY IN THE GENERAL PARTNER.

8.02        POWER OF ATTORNEY.  EACH LIMITED PARTNER HEREBY IRREVOCABLY APPOINTS
THE GENERAL PARTNER ITS TRUE AND LAWFUL ATTORNEY-IN-FACT, WHO MAY ACT FOR EACH
LIMITED PARTNER AND IN ITS NAME, PLACE AND STEAD, AND FOR ITS USE AND BENEFIT,
SIGN, ACKNOWLEDGE, SWEAR TO, DELIVER, FILE OR RECORD, AT THE APPROPRIATE PUBLIC
OFFICES, ANY AND ALL DOCUMENTS, CERTIFICATES, AND INSTRUMENTS AS MAY BE DEEMED
NECESSARY OR DESIRABLE BY THE GENERAL PARTNER TO CARRY OUT FULLY THE PROVISIONS
OF THIS AGREEMENT AND THE ACT IN ACCORDANCE WITH THEIR TERMS, WHICH POWER OF
ATTORNEY IS COUPLED WITH AN INTEREST AND SHALL SURVIVE THE DEATH, DISSOLUTION OR
LEGAL INCAPACITY OF THE LIMITED PARTNER, OR THE TRANSFER BY THE LIMITED PARTNER
OF ANY PART OR ALL OF ITS PARTNERSHIP INTEREST.

8.03        LIMITATION ON LIABILITY OF LIMITED PARTNERS.  NO LIMITED PARTNER
SHALL BE LIABLE FOR ANY DEBTS, LIABILITIES, CONTRACTS OR OBLIGATIONS OF THE
PARTNERSHIP.  A LIMITED PARTNER SHALL BE LIABLE TO THE PARTNERSHIP ONLY TO MAKE
PAYMENTS OF ITS CAPITAL CONTRIBUTION, IF ANY, AS AND WHEN DUE HEREUNDER.  AFTER
ITS CAPITAL CONTRIBUTION IS FULLY PAID, NO LIMITED PARTNER SHALL, EXCEPT AS
OTHERWISE REQUIRED BY THE ACT, BE REQUIRED TO MAKE ANY FURTHER CAPITAL
CONTRIBUTIONS OR OTHER PAYMENTS OR LEND ANY FUNDS TO THE PARTNERSHIP.

8.04        OWNERSHIP BY LIMITED PARTNER OF CORPORATE GENERAL PARTNER OR
AFFILIATE.  NO LIMITED PARTNER SHALL AT ANY TIME, EITHER DIRECTLY OR INDIRECTLY,
OWN ANY STOCK OR OTHER INTEREST IN THE GENERAL PARTNER OR IN ANY AFFILIATE
THEREOF, IF SUCH OWNERSHIP BY ITSELF OR IN CONJUNCTION WITH OTHER STOCK OR OTHER
INTERESTS OWNED BY OTHER LIMITED PARTNERS WOULD, IN THE OPINION OF COUNSEL FOR
THE PARTNERSHIP, JEOPARDIZE THE CLASSIFICATION OF THE PARTNERSHIP AS A
PARTNERSHIP FOR FEDERAL INCOME TAX PURPOSES.  THE GENERAL PARTNER SHALL BE
ENTITLED TO MAKE SUCH REASONABLE INQUIRY OF THE LIMITED PARTNERS AS IS REQUIRED
TO ESTABLISH COMPLIANCE BY THE LIMITED PARTNERS WITH THE PROVISIONS OF THIS
SECTION 8.04.

8.05        EXCHANGE RIGHT.

(a)           Subject to Sections 8.05(b), 8.05(c), 8.05(d) and 8.05(e) hereof,
and subject to the potential modification of any rights or obligations provided
for herein by agreement(s) between the Partnership and any one or more Limited
Partners with respect to Partnership Units held by them, each Limited Partner
shall have the right (the “Exchange Right”) to require the

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Partnership to redeem on a Specified Exchange Date all or a portion of the
Partnership Units held by such Limited Partner at an exchange price equal to and
in the form of the Cash Amount to be paid by the Partnership; provided, that
such Partnership Units shall have been outstanding for at least one year.  The
Exchange Right shall be exercised pursuant to the delivery of an Exchange Notice
to the Partnership (with a copy to the Company) by the Limited Partner who is
exercising the Exchange Right (the “Exchanging Partner”); provided, however,
that the Partnership shall not be obligated to satisfy such Exchange Right if
the Company elects to purchase the Partnership Units subject to the Exchange
Notice pursuant to Section 8.05(b); and provided further, that no Limited
Partner may deliver more than two Exchange Notices during each calendar year.  A
Limited Partner may not exercise the Exchange Right for less than 1,000
Partnership Units or, if such Limited Partner holds less than 1,000 Partnership
Units, all of the Partnership Units held by such Partner.  The Exchanging
Partner shall have no right, with respect to any Partnership Units so exchanged,
to receive any distribution paid with respect to such Partnership Units if the
record date for such distribution is on or after the Specified Exchange Date.

(b)           Notwithstanding the provisions of Section 8.05(a), a Limited
Partner that exercises the Exchange Right shall be deemed to have also offered
to sell the Partnership Units described in the Exchange Notice to the Company,
and the Company may, in its sole and absolute discretion, elect to purchase
directly and acquire such Partnership Units by paying to the Exchanging Partner
either the Cash Amount or the REIT Shares Amount, as elected by the Company (in
its sole and absolute discretion), on the Specified Exchange Date, whereupon the
Company shall acquire the Partnership Units offered for exchange by the
Exchanging Partner and shall be treated for all purposes of this Agreement as
the owner of such Partnership Units.  If the Company shall elect to exercise its
right to purchase Partnership Units under this Section 8.05(b) with respect to
an Exchange Notice, it shall so notify the Exchanging Partner within five
business days after the receipt by the Company of such Exchange Notice.  Unless
the Company (in its sole and absolute discretion) shall exercise its right to
purchase Partnership Units from the Exchanging Partner pursuant to this Section
8.05(b), the Company shall have no obligation to the Exchanging Partner or the
Partnership with respect to the Exchanging Partner’s exercise of an Exchange
Right.  In the event the Company shall exercise its right to purchase
Partnership Units with respect to the exercise of an Exchange Right in the
manner described in the first sentence of this Section 8.05(b), the Partnership
shall have no obligation to pay any amount to the Exchanging Partner with
respect to such Exchanging Partner’s exercise of such Exchange Right, and each
of the Exchanging Partner and the Company shall treat the transaction between
the Company and the Exchanging Partner for federal income tax purposes as a sale
of the Exchanging Partner’s Partnership Units to the Company.  Each Exchanging
Partner agrees to execute such documents as the Company may reasonably require
in connection with the issuance of REIT Shares to such Exchanging Partner upon
exercise of its Exchange Right.

(c)           Notwithstanding the provisions of Sections 8.05(a) and 8.05(b), a
Limited Partner shall not be entitled to exercise the Exchange Right if the
delivery of REIT Shares to such Partner on the Specified Exchange Date by the
Company pursuant to Section 8.05(b) (regardless of whether or not the Company
would in fact exercise its rights under Section 8.05(b)) would (i) result in
such Partner or any other person owning, directly or indirectly, REIT Shares in
excess of the ownership limitations described in the Articles of Incorporation
and calculated in accordance therewith, (ii) result in REIT Shares being owned
by fewer than 100 persons

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(determined without reference to any rules of attribution), except as provided
in the Articles of Incorporation, (iii) result in the Company being “closely
held” within the meaning of Section 856(h) of the Code, (iv) cause the Company
to own, directly or constructively, 10% or more of the ownership interests in a
tenant of the Company’s, the Partnership’s, or a Subsidiary Partnership’s real
property within the meaning of Section 856(d)(2)(B) of the Code, or (v) cause
the acquisition of REIT Shares by such Partner to be “integrated” with any other
distribution of REIT Shares for purposes of complying with the registration
provisions of the Securities Act, provided, that if such Partner delivers an
opinion of counsel that is reasonably satisfactory to the Company providing that
the acquisition of REIT Shares by such Partner will not be “integrated” with any
other distribution of REIT Shares for purposes of complying with the Securities
Act, then the General Partner may not prevent such Partner from exercising the
Exchange Right by virtue of this clause (v).  The General Partner, in its sole
and absolute discretion, may, with the consent of the Company, waive any of the
restrictions on exchange set forth in this Section 8.05(c); provided, however,
that in the event any such restriction is waived, the Exchanging Partner shall
be paid the Cash Amount.

(d)           Any Cash Amount to be paid to an Exchanging Partner pursuant to
this Section 8.05 shall be paid on the Specified Exchange Date; provided,
however, that the General Partner may elect to cause the Specified Exchange Date
to be delayed for up to 180 days to the extent required for the General Partner
to cause additional REIT Shares to be issued to provide financing to be used to
make such payment of the Cash Amount.  Notwithstanding the foregoing, the
General Partner agrees to use its best efforts to cause the closing of the
acquisition of exchanged Partnership Units hereunder to occur as quickly as
reasonably possible.

(e)           Notwithstanding any other provision of this Agreement, the General
Partner shall place appropriate restrictions on the ability of the Limited
Partners to exercise their Exchange Rights as and if deemed necessary to ensure
that the Partnership does not constitute a “publicly traded partnership” under
Section 7704 of the Code.  If and when the General Partner determines that
imposing such restrictions is necessary, the General Partner shall give prompt
written notice thereof (a “Restriction Notice”) to each of the Limited Partners,
which notice shall be accompanied by a copy of an opinion of counsel to the
Partnership which states that, in the opinion of such counsel, restrictions are
necessary in order to avoid the Partnership being treated as a “publicly traded
partnership” under Section 7704 of the Code.

8.06        CALL RIGHT.

(a)           Subject to Section 8.06(c) below, and subject to the modification
of any rights or obligations provided for herein by agreement(s) between the
Company and any one or more Limited Partners with respect to the Partnership
Units held by them, at any time after the expiration of the Holding Period for
the Partnership Units in question, the Company shall have the right (the “Call
Right”) to purchase all of the Partnership Units held by a Limited Partner at a
price equal to the Cash Amount; provided, however, that the Company (or any of
its Affiliates) may, in the Company’s sole and absolute discretion, elect to
purchase such Partnership Units by paying to the Partner in question the REIT
Shares Amount in lieu of the Cash Amount.  The Call Right shall be exercised
pursuant to a Call Notice delivered by the Company to any such Limited Partner. 
The Company may not exercise the Call Right for less than the entire interest of
a Limited Partner in the Partnership.  A Limited Partner receiving the Call
Notice described above

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shall have no rights with respect to any interest in the Partnership other than
the right to receive payment for its interest in the Partnership in cash or REIT
Shares in accordance with this Section 8.06.  An assignee of a Limited Partner
shall be bound by and subject to the Call Right of the Company pursuant to this
Section 8.06.  In connection with any exercise of such Call Right by the Company
with respect to an assignee, the Cash Amount (or REIT Shares Amount) shall be
paid by the Company directly to such assignee and not to the Limited Partner
from which such assignee acquired its Partnership Units.  The Company shall be
unable to exercise the Call Right and the Call Right shall lapse upon the
occurrence of a Liquidating Event unless and until the Partners shall continue
the business of the Partnership under Section 7.03 hereof.

(b)           (i)            Within 30 days after the delivery of the Call
Notice by the Company to a Limited Partner under this Section 8.06, the Company
(subject to the limitations set forth in Section 8.06(c)) shall transfer and
deliver the Cash Amount (or the REIT Shares Amount) to such Limited Partner or,
as applicable, its assignee, whereupon the Company (or its designee) shall
acquire the Partnership Units of such Limited Partner or, as applicable, its
assignee, and shall be treated for all purposes of this Agreement as the owner
of such Partnership Units (and as a Limited Partner with respect to such
Partnership Units).

(ii)           In the event that the Company elects to pay such Limited Partner
in the form of the REIT Shares Amount and such REIT Shares Amount is not a whole
number of REIT Shares, the Limited Partner shall be paid (A) the number of REIT
Shares which equals the nearest whole number less than such amount plus (B) an
amount of cash which the Company determines, in its reasonable discretion, to
represent the fair value of the remaining fractional REIT Share which would
otherwise be payable to the Limited Partner.

(iii)          Each Limited Partner agrees to deliver to the Company the
Partnership Unit Certificate(s) representing its Limited Partnership Interest
and to execute such documents as the Company may reasonably require in
connection with the issuance of REIT Shares upon exercise of the Call Right
(including without limitation an assignment of Partnership Units pursuant to the
terms of which such Limited Partner (A) represents, warrants and certifies that
it has marketable and unencumbered title to its Partnership Units, free and
clear of the rights of or interest of any other person or entity, that it has
the full right, power and authority to transfer and surrender its Partnership
Units, and that it has obtained the consent or approval of all persons or
entities, if any, having the right to consent to or approve of such transfer and
surrender, and (B) agrees to indemnify and hold the Company harmless from and
against any and all liabilities, charges, costs and expenses relating to such
Limited Partner’s Partnership Units which are subject to the Call Right or the
exercise of the Call Right).

(c)           Notwithstanding the provisions of Sections 8.06(a) and 8.06(b)
above, the Company shall not be entitled to exercise the Call Right if (i) a
Liquidating Event has occurred with regard to the Partnership and the
Partnership has not been continued under Section 7.03 hereof; or (ii) the
delivery of REIT Shares to the Limited Partner (A) would be prohibited under the
Articles of Incorporation, (B) would adversely affect the ability of the Company
to continue to qualify as a REIT or subject the Company to any additional taxes
under Section 857 or Section 4981 of the Code, or (C) would be prohibited under
applicable federal or state securities laws or regulations.

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(d)           Each Limited Partner covenants and agrees with the Company that
all Partnership Units delivered in connection with the Call Right shall be
delivered to the Company free and clear of all liens and encumbrances and,
notwithstanding anything contained herein to the contrary, the General Partner
shall not be under any obligation to acquire a Limited Partner’s Partnership
Units (i) to the extent that any such Partnership Units are subject to any such
liens or encumbrances or (ii) in the event that the Limited Partner shall fail
to give the Company adequate assurances that such Partnership Units are not
subject to any such liens or encumbrances or shall fail to agree to fully
indemnify the Company from any such liens or encumbrances as well as the
liabilities, charges, costs and expenses referenced in the last section of
Section 8.06(b)(iii).  Each Limited Partner further agrees that, in the event
any state or local transfer tax is payable as a result of the transfer of its
Partnership Units to the Company, such Limited Partner shall assume and pay such
transfer tax.

8.07        DUTIES AND CONFLICTS.  THE GENERAL PARTNER RECOGNIZES THAT THE
LIMITED PARTNERS AND THEIR AFFILIATES HAVE OR MAY HAVE OTHER BUSINESS INTERESTS,
ACTIVITIES AND INVESTMENTS, SOME OF WHICH MAY BE IN CONFLICT OR COMPETITION WITH
THE BUSINESS OF THE PARTNERSHIP, AND THAT SUCH PERSONS ARE ENTITLED TO CARRY ON
SUCH OTHER BUSINESS INTERESTS, ACTIVITIES AND INVESTMENTS.  THE LIMITED PARTNERS
AND THEIR AFFILIATES MAY ENGAGE IN OR POSSESS AN INTEREST IN ANY OTHER BUSINESS
OR VENTURE OF ANY KIND, INDEPENDENTLY OR WITH OTHERS, ON THEIR OWN BEHALF OR ON
BEHALF OF OTHER ENTITIES WITH WHICH THEY ARE AFFILIATED OR ASSOCIATED, AND SUCH
PERSONS MAY ENGAGE IN ANY ACTIVITIES, WHETHER OR NOT COMPETITIVE WITH THE
PARTNERSHIP, WITHOUT ANY OBLIGATION TO OFFER ANY INTEREST IN SUCH ACTIVITIES TO
THE PARTNERSHIP OR TO ANY PARTNER.  NEITHER THE PARTNERSHIP NOR ANY PARTNER
SHALL HAVE ANY RIGHT, BY VIRTUE OF THIS AGREEMENT, IN OR TO SUCH ACTIVITIES, OR
THE INCOME OR PROFITS DERIVED THEREFROM, AND THE PURSUIT OF SUCH ACTIVITIES,
EVEN IF COMPETITIVE WITH THE BUSINESS OF THE PARTNERSHIP, AND SUCH ACTIVITIES
SHALL NOT BE DEEMED WRONGFUL OR IMPROPER.

ARTICLE IX

TRANSFERS OF LIMITED PARTNERSHIP INTERESTS

9.01        PURCHASE FOR INVESTMENT.

(a)           Each Limited Partner hereby represents and warrants to the General
Partner and to the Partnership that the acquisition of its Partnership Interest
is made as a principal for its account for investment purposes only and not with
a view to the resale or distribution of such Partnership Interest.

(b)           Each Limited Partner agrees that it will not sell, assign or
otherwise transfer its Partnership Interest or any fraction thereof, whether
voluntarily or by operation of law or at judicial sale or otherwise, to any
Person who does not make the representations and warranties to the General
Partner set forth in Section 9.01(a) above.

9.02        RESTRICTIONS ON TRANSFER OF LIMITED PARTNERSHIP INTERESTS.

(a)           Subject to the provisions of Sections 9.02(b), 9.02(c) and
9.02(d), no Limited Partner may offer, sell, assign, hypothecate, pledge or
otherwise transfer all or any portion of its Limited Partnership Interest, or
any of such Limited Partner’s economic rights as a Limited

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Partner, whether voluntarily or by operation of law or at judicial sale or
otherwise (collectively, a “Transfer”), without the consent of the General
Partner, which consent may be granted or withheld in its sole and absolute
discretion.  Any such purported transfer undertaken without such consent shall
be considered to be null and void ab initio and shall not be given effect.  The
Original Limited Partners acknowledge that the General Partner may or may not
grant its consent with respect to any Transfer by the Original Limited Partners
prior to the Transfer Restriction Date; provided, that the Original Limited
Partners shall not be prohibited from a Transfer of its Partnership Interest
pursuant to the exercise of its right to exchange its Partnership Interest for
REIT Shares pursuant to Section 8.05 above, in which case the Original Limited
Partners acknowledge that the General Partner also may or may not grant its
consent with respect to any Transfer of said REIT Shares prior to the Transfer
Restriction Date.  The General Partner may require, as a condition of any
Transfer to which it consents, that the transferor assume all costs incurred by
the Partnership in connection therewith.

(b)           No Limited Partner may withdraw from the Partnership other than as
a result of: (i) a permitted Transfer (i.e., a Transfer consented to as
contemplated by paragraph (a) above or paragraph (c) below or a Transfer made
pursuant to Section 9.05 below) of all of its Partnership Units pursuant to this
Article IX pursuant to an exchange of all of its Partnership Units pursuant to
Section 8.05 above; or (ii) a Transfer made pursuant to the sale of all its
Partnership Units pursuant to Section 8.06 above.  Upon the permitted Transfer
or redemption of all of a Limited Partner’s Partnership Units, such Limited
Partner shall cease to be a Limited Partner.

(c)           Subject to Sections 9.02(d), 9.02(e) and 9.02(f), a Limited
Partner may Transfer, with the consent of the General Partner, all or a portion
of its Partnership Units to (i) a parent or parent’s spouse, natural or adopted
descendants, a spouse of any such descendant, a brother or sister, or a trust
created by such Limited Partner for the benefit of such Limited Partner and/or
any such person(s), for which trust such Limited Partner or any such person(s)
is a trustee, (ii) a corporation controlled by a Person or Persons named in (i)
above, or (iii) if the Limited Partner is an entity, its beneficial owners.

(d)           No Limited Partner may effect a Transfer of its Limited
Partnership Interest, in whole or in part, if, in the opinion of legal counsel
for the Partnership, such proposed Transfer would require the registration of
the Limited Partnership Interest under the Securities Act, or would otherwise
violate any applicable federal or state securities or blue sky law (including
investment suitability standards).

(e)           No Transfer by a Limited Partner of its Partnership Units, in
whole or in part, may be made to any Person if (i) in the opinion of legal
counsel for the Partnership, the transfer would result in the Partnership’s
being treated as an association taxable as a corporation (other than a qualified
REIT subsidiary within the meaning of Section 856(i) of the Code), (ii) in the
opinion of legal counsel for the Company, it would adversely affect the ability
of the Company to continue to qualify as a REIT or subject the Company to any
additional taxes under Section 857 or Section 4981 of the Code, or (iii) such
transfer is effectuated through an “established securities market” or a
“secondary market” (or the substantial equivalent thereof) within the meaning of
Section 7704 of the Code.

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(f)            No transfer of any Partnership Units may be made to a lender to
the Partnership or any Person who is related (within the meaning of Regulations
Section 1.752-4(b)) to any lender to the Partnership whose loan constitutes a
nonrecourse liability (within the meaning of Regulations Section 1.752-1(a)(2)),
without the consent of the General Partner, which may be withheld in its sole
and absolute discretion; provided, that as a condition to such consent the
lender will be required to enter into an arrangement with the Partnership and
the Company to exchange or redeem for the Cash Amount any Partnership Units in
which a security interest is held simultaneously with the time at which such
lender would be deemed to be a partner in the Partnership for purposes of
allocating liabilities to such lender under Section 752 of the Code.

(g)           Any Transfer in contravention of any of the provisions of this
Article IX shall be void and ineffectual and shall not be binding upon, or
recognized by, the Partnership.

(h)           Prior to the consummation of any Transfer under this Article IX,
the transferor and/or the transferee shall deliver to the General Partner such
opinions, certificates and other documents as the General Partner shall request
in connection with such Transfer.

9.03        ADMISSION OF SUBSTITUTE LIMITED PARTNER.

(a)           Subject to the other provisions of this Article IX, an assignee of
the Limited Partnership Interest of a Limited Partner (which shall be understood
to include any purchaser, transferee, donee or other recipient of any
disposition of such Limited Partnership Interest) shall be deemed admitted as a
Limited Partner of the Partnership only with the consent of the General Partner
and upon the satisfactory completion of the following:

(i)            the assignee shall have accepted and agreed to be bound by the
terms and provisions of this Agreement by executing a counterpart or an
amendment thereof, including a revised Exhibit A, and such other documents or
instruments as the General Partner may require in order to effect the admission
of such Person as a Limited Partner;

(ii)           to the extent required, an amended Certificate evidencing the
admission of such Person as a Limited Partner shall have been signed,
acknowledged and filed for record in accordance with the Act;

(iii)          the assignee shall have delivered a letter containing the
representation set forth in Section 9.01(a) hereof and the agreement set forth
in Section 9.01(b) hereof;

(iv)          if the assignee is a corporation, partnership or trust, the
assignee shall have provided the General Partner with evidence satisfactory to
counsel for the Partnership of the assignee’s authority to become a Limited
Partner under the terms and provisions of this Agreement;

(v)           the assignee shall have executed a power of attorney containing
the terms and provisions set forth in Section 8.02 hereof;

(vi)          the assignee shall have paid all legal fees and other expenses of
the Partnership and the General Partner and filing and publication costs in
connection with its substitution as a Limited Partner; and

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(vii)         the assignee shall have obtained the prior written consent of the
General Partner to its admission as a Substitute Limited Partner, which consent
may be given or denied in the exercise of the General Partner’s sole and
absolute discretion.

(b)           For the purpose of allocating Profit and Loss and distributing
cash received by the Partnership, a Substitute Limited Partner shall be treated
as having become, and appearing in the records of the Partnership as, a Partner
upon the filing of the Certificate described in Section 9.03(a)(ii) hereof or,
if no such filing is required, the later of the date specified in the transfer
documents or the date on which the General Partner has received all necessary
instruments of transfer and substitution.

(c)           The General Partner shall cooperate with the Person seeking to
become a Substitute Limited Partner by preparing the documentation required by
this Section 9.03 and making all official filings and publications.  The
Partnership shall take all such action as promptly as practicable after the
satisfaction of the conditions in this Article IX to the admission of such
Person as a Limited Partner of the Partnership.

9.04        RIGHTS OF ASSIGNEES OF PARTNERSHIP INTERESTS.

(a)           Subject to the provisions of Sections 9.01 and 9.02 hereof, except
as required by operation of law, the Partnership shall not be obligated for any
purposes whatsoever to recognize the assignment by any Limited Partner of its
Partnership Interest until the Partnership has received notice thereof.

(b)           Any Person who is the assignee of all or any portion of a Limited
Partner’s Limited Partnership Interest, but who does not become a Substitute
Limited Partner and desires to make a further assignment of such Limited
Partnership Interest, shall be subject to all the provisions of this Article IX
to the same extent and in the same manner as any Limited Partner desiring to
make an assignment of its Limited Partnership Interest.

9.05        EFFECT OF BANKRUPTCY, DEATH, INCOMPETENCE OR TERMINATION OF A
LIMITED PARTNER.

The occurrence of an Event of Bankruptcy as to a Limited Partner, the death of a
Limited Partner or a final adjudication that a Limited Partner is incompetent
(which term shall include, but not be limited to, insanity) shall not cause the
termination or dissolution of the Partnership, and the business of the
Partnership shall continue if an order for relief in a bankruptcy proceeding is
entered against a Limited Partner, the trustee or receiver of his estate or, if
he dies, his executor, administrator or trustee, or, if he is finally
adjudicated incompetent, his committee, guardian or conservator, and any such
Person shall have the rights of such Limited Partner for the purpose of settling
or managing his estate property and such power as the bankrupt, deceased or
incompetent Limited Partner possessed to assign all or any part of his
Partnership Interest and to join with the assignee in satisfying conditions
precedent to the admission of the assignee as a Substitute Limited Partner.

9.06        JOINT OWNERSHIP OF INTERESTS.  A PARTNERSHIP INTEREST MAY BE
ACQUIRED BY TWO INDIVIDUALS AS JOINT TENANTS WITH RIGHT OF SURVIVORSHIP,
PROVIDED, THAT SUCH INDIVIDUALS EITHER ARE MARRIED OR ARE RELATED AND SHARE THE
SAME PERSONAL RESIDENCE.  THE WRITTEN CONSENT OR VOTE OF BOTH OWNERS OF ANY SUCH
JOINTLY-HELD PARTNERSHIP INTEREST SHALL BE REQUIRED TO CONSTITUTE THE ACTION OF

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THE OWNERS OF SUCH PARTNERSHIP INTEREST; PROVIDED, HOWEVER, THAT THE WRITTEN
CONSENT OF ONLY ONE JOINT OWNER WILL BE REQUIRED IF THE PARTNERSHIP HAS BEEN
PROVIDED WITH EVIDENCE SATISFACTORY TO THE COUNSEL FOR THE PARTNERSHIP THAT THE
ACTIONS OF A SINGLE JOINT OWNER CAN BIND BOTH OWNERS UNDER THE APPLICABLE LAWS
OF THE STATE OF RESIDENCE OF SUCH JOINT OWNERS.  UPON THE DEATH OF ONE OWNER OF
A PARTNERSHIP INTEREST HELD IN A JOINT TENANCY WITH A RIGHT OF SURVIVORSHIP, THE
PARTNERSHIP INTEREST SHALL BECOME OWNED SOLELY BY THE SURVIVOR AS A LIMITED
PARTNER AND NOT AS AN ASSIGNEE.  THE PARTNERSHIP NEED NOT RECOGNIZE THE DEATH OF
ONE OF THE OWNERS OF A JOINTLY HELD PARTNERSHIP INTEREST UNTIL IT SHALL HAVE
RECEIVED NOTICE OF SUCH DEATH.  UPON NOTICE TO THE GENERAL PARTNER FROM EITHER
OWNER, THE GENERAL PARTNER SHALL CAUSE THE PARTNERSHIP INTEREST TO BE DIVIDED
INTO TWO EQUAL PARTNERSHIP INTERESTS, WHICH SHALL THEREAFTER BE OWNED SEPARATELY
BY EACH OF THE FORMER JOINT OWNERS.

ARTICLE X

BOOKS AND RECORDS; ACCOUNTING; TAX MATTERS

10.01      BOOKS AND RECORDS.  AT ALL TIMES DURING THE CONTINUANCE OF THE
PARTNERSHIP, THE PARTNERS SHALL KEEP OR CAUSE TO BE KEPT AT THE PARTNERSHIP’S
SPECIFIED OFFICE TRUE AND COMPLETE BOOKS OF ACCOUNT MAINTAINED IN ACCORDANCE
WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES, INCLUDING (A) A CURRENT LIST OF
THE FULL NAME AND LAST-KNOWN BUSINESS ADDRESS OF EACH PARTNER; (B) A COPY OF THE
CERTIFICATE OF LIMITED PARTNERSHIP AND ALL CERTIFICATES OF AMENDMENT THERETO;
(C) COPIES OF THE PARTNERSHIP’S FEDERAL, STATE AND LOCAL INCOME TAX RETURNS AND
REPORTS; (D) COPIES OF THE AGREEMENT AND ANY FINANCIAL STATEMENTS OF THE
PARTNERSHIP FOR THE THREE MOST RECENT YEARS; AND (E) ALL DOCUMENTS AND
INFORMATION REQUIRED UNDER THE ACT.  ANY PARTNER OR ITS DULY AUTHORIZED
REPRESENTATIVE, AND ANY STOCKHOLDER OF THE COMPANY, UPON PAYING THE COSTS OF
COLLECTION, DUPLICATION AND MAILING, SHALL BE ENTITLED TO INSPECT OR COPY SUCH
RECORDS DURING ORDINARY BUSINESS HOURS.

10.02      CUSTODY OF PARTNERSHIP FUNDS; BANK ACCOUNTS.

(a)           All funds of the Partnership not otherwise invested shall be
deposited in one or more accounts maintained in such banking or brokerage
institutions as the General Partner shall determine, and withdrawals shall be
made only on such signature or signatures as the General Partner may, from time
to time, determine.

(b)           All deposits and other funds not needed in the operation of the
business of the Partnership may be invested by the General Partner in investment
grade instruments (or investment companies whose portfolio consists primarily
thereof, government obligations, certificates of deposit, bankers’ acceptances
and municipal notes and bonds.  The funds of the Partnership shall not be
commingled with the funds of any other Person except for such commingling as may
necessarily result from an investment in those investment companies permitted by
this Section 10.02(b).

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10.03      FISCAL AND TAXABLE YEAR.  THE FISCAL AND TAXABLE YEAR OF THE
PARTNERSHIP SHALL BE THE CALENDAR YEAR.

10.04      ANNUAL TAX INFORMATION AND REPORT.  THE GENERAL PARTNER WILL USE ITS
BEST EFFORTS TO SUPPLY WITHIN 75 DAYS AFTER THE END OF EACH FISCAL YEAR OF THE
PARTNERSHIP TO EACH PERSON WHO WAS A LIMITED PARTNER AT ANY TIME DURING SUCH
YEAR THE TAX INFORMATION NECESSARY TO FILE SUCH LIMITED PARTNER’S INDIVIDUAL TAX
RETURNS AS SHALL BE REASONABLY REQUIRED BY LAW, AND IN ALL EVENTS THE GENERAL
PARTNER SHALL FURNISH SUCH INFORMATION WITHIN THE TIME REQUIRED BY APPLICABLE
LAW.

10.05      TAX MATTERS PARTNER; TAX ELECTIONS; SPECIAL BASIS ADJUSTMENTS.

(a)           The General Partner shall be the Tax Matters Partner of the
Partnership within the meaning of Section 6231(a)(7) of the Code.  As Tax
Matters Partner, the General Partner shall have the right and obligation to take
all actions authorized and required, respectively, by the Code for the Tax
Matters Partner.  The General Partner shall have the right to retain
professional assistance in respect of any audit of the Partnership by the
Service and all out-of-pocket expenses and fees incurred by the General Partner
on behalf of the Partnership as Tax Matters Partner shall constitute Partnership
expenses.  In the event the General Partner receives notice of a final
Partnership adjustment under Section 6223(a)(2) of the Code, the General Partner
shall either (i) file a court petition for judicial review of such final
adjustment within the period provided under Section 6226(a) of the Code, a copy
of which petition shall be mailed to all Limited Partners on the date such
petition is filed, or (ii) mail a written notice to all Limited Partners, within
such period, that describes the General Partner’s reasons for determining not to
file such a petition.

(b)           All elections required or permitted to be made by the Partnership
under the Code or any applicable state or local tax law shall be made by the
General Partner in its sole and absolute discretion.

(c)           In the event of a transfer of all or any part of the Partnership
Interest of any Partner, the Partnership, at the option and in the sole and
absolute discretion of the General Partner, may elect pursuant to Section 754 of
the Code to adjust the basis of the Properties.  Notwithstanding anything
contained in Article V of this Agreement, any adjustments made pursuant to
Section 754 shall affect only the successor-in-interest to the transferring
Partner and in no event shall be taken into account in establishing, maintaining
or computing Capital Accounts for the other Partners for any purpose under this
Agreement.  Each Partner will furnish the Partnership with all information
necessary to give effect to such election.

10.06      REPORTS TO LIMITED PARTNERS.

(a)           As soon as practicable after the close of each fiscal quarter
(other than the last quarter of the fiscal year), the General Partner shall
cause to be mailed to each Limited Partner a quarterly report containing
financial statements of the Partnership, or of the Company if such statements
are prepared solely on a consolidated basis with the Company, for such fiscal
quarter presented in accordance with generally accepted accounting principles. 
As soon as practicable after the close of each fiscal year, the General Partner
shall cause to be mailed to each Limited Partner an annual report containing
financial statements of the Partnership, or of the Company if such statements
are prepared solely on a consolidated basis with the Company, for such fiscal

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year, presented in accordance with generally accepted accounting principles. 
The annual financial statements shall be audited by accountants selected by the
General Partner.

(b)           Any Partner shall further have the right to a private audit of the
books and records of the Partnership, provided such audit is made for
Partnership purposes and at the expense of the Partner desiring it, and it is
made during normal business hours.

ARTICLE XI

AMENDMENT OF AGREEMENT; MEETINGS

11.01      AMENDMENT.  THE GENERAL PARTNER’S CONSENT SHALL BE REQUIRED FOR ANY
AMENDMENT TO THIS AGREEMENT.  THE GENERAL PARTNER, WITHOUT THE CONSENT OF THE
LIMITED PARTNERS, MAY AMEND THIS AGREEMENT IN ANY RESPECT; PROVIDED, HOWEVER,
THAT THE FOLLOWING AMENDMENTS SHALL REQUIRE THE CONSENT OF LIMITED PARTNERS
HOLDING MORE THAN 50% OF THE PERCENTAGE INTERESTS OF THE LIMITED PARTNERS:

(a)           any amendment affecting the operation of the Conversion Factor or
the Exchange Right (except as provided in Sections 8.05(d) or 7.01(d) hereof) in
a manner adverse to the Limited Partners;

(b)           any amendment that would adversely affect the rights of the
Limited Partners to receive the distributions payable to them hereunder, other
than with respect to the issuance of additional Partnership Units pursuant to
Section 4.02 hereof;

(c)           any amendment that would alter the Partnership’s allocations of
Profit and Loss to the Limited Partners, other than with respect to the issuance
of additional Partnership Units pursuant to Section 4.02 hereof; or

(d)           any amendment that would impose on the Limited Partners any
obligation to make additional Capital Contributions to the Partnership.

The foregoing notwithstanding, the approval of any amendment to this Agreement
that shall be part of a plan of merger, plan of exchange or plan of conversion
involving the Partnership or the Partnership Interests shall be governed by
Article XII.

11.02      MEETINGS OF PARTNERS.

(a)           The Partners may but shall not be required to hold any annual,
periodic or other formal meetings.  Meetings of the Partners may be called by
the General Partner or by any Limited Partner or Limited Partners holding at
least 10% of the Partnership Units in the Partnership.

(b)           The Partner or Partners calling the meeting may designate any
place within the State of Texas as the place of meeting for any meeting of the
Partners; and Partners holding at least a majority of the Partnership Units in
the Partnership may designate any place outside the State of Texas as the place
of meeting for any meeting of the Partners.  If no designation is made,

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or if a special meeting is called, the place of meeting shall be the principal
place of business of the Partnership.

(c)           Except as provided in Section 11.02(d), written notice stating the
place, day and hour of the meeting and the purpose or purposes for which the
meeting is called shall be delivered not less than ten (10) nor more than ninety
(90) days before the date of the meeting, either personally or by mail, by or at
the direction of the Partner or Partners calling the meeting, to each Partner
entitled to vote at such meeting and to each Partner not entitled to vote who is
entitled to notice of the meeting.

(d)           Anything in this Agreement to the contrary notwithstanding, with
respect to any meeting of the Partners, any Partner who in person or by proxy
shall have waived in writing notice of the meeting, either before or after such
meeting, or who shall attend the meeting in person or by proxy, shall be deemed
to have waived notice of such meeting unless such Partner attends for the
express purpose of objecting, at the beginning of the meeting, and does so
object to the transaction of any business because the meeting is not lawfully
called or convened.

(e)           If all of the Partners shall meet at any time and place, either
within or outside of the State of Texas, in person or by proxy, and consent to
the holding of a meeting at such time and place, such meeting shall be valid
without call or notice, and at such meeting lawful action may be taken.

(f)            For the purpose of determining Partners entitled to notice of or
to vote at any meeting of Partners or any adjournment thereof, the date on which
notice of the meeting is mailed shall be the record date. When a determination
of Partners entitled to vote at any meeting of Partners has been made as
provided in this Section, such determination shall apply to any adjournment
thereof.

(g)           Partners holding at least a majority of the Partnership Units
entitled to vote at a meeting, represented in person or by proxy, shall
constitute a quorum at any meeting of Partners. In the absence of a quorum at
any such meeting, Partners holding at least a majority of Partnership Units so
represented may adjourn the meeting to another time and place.  Any business
which might have been transacted at the original meeting may be transacted at
any adjourned meeting at which a quorum is present.  No notice of an adjourned
meeting need be given if the time and place are announced at the meeting at
which the adjournment is taken unless the adjournment is for more than 120
days.  The Partners present at a duly organized meeting may continue to transact
business until adjournment, notwithstanding the withdrawal during such meeting
of that number Partnership Units whose absence would cause less than a quorum to
be present.

(h)           If a quorum is present, the affirmative vote of Partners holding a
majority of the Partnership Units entitled to vote, present in person or
represented by proxy, shall be binding on all Partners, unless the vote of a
greater or lesser proportion or number of Partnership Units or Partners is
otherwise required by applicable law or by this Agreement.  Unless otherwise
expressly provided herein or required under applicable law, Partners who have an
interest (economic or otherwise) in the outcome of any particular matter upon
which the Partners’ vote or consent is required may vote or consent upon any
such matter and their Partnership Units, vote

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or consent, as the case may be, shall be counted in the determination of whether
the requisite matter was approved by the Partners.

(i)            At all meetings of Partners, a Partner may vote in person or by
proxy executed in writing by the Partner or by the Partner’s duly authorized
attorney-in-fact. Such proxy shall be filed with the General Partner before or
at the time of the meeting. No proxy shall be valid after eleven months from the
date of its execution, unless otherwise provided in the proxy.

(j)            Action required or permitted to be taken at a meeting of Partners
may be taken without a meeting if the action is evidenced by one or more written
consents or approvals describing the action taken and signed by sufficient
Partners or Partners holding sufficient Partnership Units, as the case may be,
to approve such action had such action been properly voted on at a duly called
meeting of the Partners.  Action taken under this Section 11.02(j) is effective
when the requisite Partners or Partners with the requisite Partnership Units, as
the case may be, have signed the consent or approval, unless the consent
specifies a different effective date.

ARTICLE XII

MERGER, EXCHANGE OR CONVERSION

12.01      MERGER, EXCHANGE OR CONVERSION OF PARTNERSHIP.  (A) THE PARTNERSHIP
MAY (I) ADOPT A PLAN OF MERGER AND MAY MERGE WITH OR INTO ONE OR MORE DOMESTIC
OR FOREIGN LIMITED PARTNERSHIPS OR OTHER ENTITIES WITH THE RESULTING ENTITY
BEING ONE OR MORE SURVIVING ENTITIES, (II) ADOPT A PLAN OF EXCHANGE BY WHICH A
DOMESTIC OR FOREIGN LIMITED PARTNERSHIP OR OTHER ENTITY IS TO ACQUIRE ALL OF THE
OUTSTANDING PARTNERSHIP INTERESTS OF THE PARTNERSHIP IN EXCHANGE FOR CASH,
SECURITIES OR OTHER PROPERTY OF THE ACQUIRING DOMESTIC OR FOREIGN LIMITED
PARTNERSHIP OR OTHER ENTITY OR (III) ADOPT A PLAN OF CONVERSION AND CONVERT TO A
FOREIGN LIMITED PARTNERSHIP OR OTHER ENTITY.  ANY SUCH PLAN OF MERGER, PLAN OF
EXCHANGE, OR PLAN OF CONVERSION SHALL OTHERWISE COMPLY WITH THE REQUIREMENTS OF
THIS AGREEMENT AND THE ACT.

(b)           Any merger pursuant to a plan of merger described in Section
12.01(a)(i) hereof shall be conditioned upon the merger being permitted by the
laws under which each other entity that is a party to the merger is incorporated
or organized or by the constituent documents of such other entity that are not
inconsistent with such laws.  Any exchange pursuant to a plan of exchange
described in Section 12.01(a)(ii) hereof shall be conditioned upon the issuance
of

shares or other interests of the acquiring foreign limited partnership or other
entity being permitted by the laws under which such foreign limited partnership
or other entity is incorporated or organized or is not inconsistent with such
laws.  Any conversion pursuant to a plan of conversion described in Section
12.01(a)(iii) hereof shall be conditioned upon such conversion being permitted
by, or not inconsistent with, the laws of the jurisdiction in which the
converted entity is to be incorporated, formed or organized and the
incorporation, formation or organization of the converted entity is effected in
compliance with such laws.

(c)           The Partnership may adopt a plan of merger, plan of exchange or
plan of conversion if the General Partner acts upon and the Limited Partners (if
required by Section

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12.02 below) approve the plan of merger, plan of exchange or plan of conversion
in the manner prescribed in Section 12.02 below.

12.02      APPROVAL OF PLAN OF MERGER, EXCHANGE OR CONVERSION.

(a)           Except as provided by Section 12.02(g) below, after acting on a
plan of merger, plan of exchange or plan of conversion in the manner prescribed
by Section 12.02(b)(i), the General Partner shall submit the plan of merger,
plan of exchange or plan of conversion for approval by the Limited Partners.

(b)           Except as provided by Section 12.02(f) below, for a plan of
merger, plan of exchange or plan of conversion to be approved:

(i)            the General Partner shall adopt a resolution recommending that
the plan of merger, plan of exchange or plan of conversion be approved by the
Limited Partners, unless the General Partner determines that for any reason it
should not make that recommendation, in which case the General Partner shall
adopt a resolution directing that the plan of merger, plan of exchange or plan
of conversion be submitted to the Limited Partners for approval without
recommendation; and

(ii)           the Limited Partners entitled to vote on the plan of merger, plan
of exchange or plan of conversion must approve the plan.

(c)           The General Partner may condition its submission to the Limited
Partners of a plan of merger, plan of exchange or plan of conversion, and the
effectiveness of such plan, on any basis, including without limitation that a
specified percentage of the Percentage Interests of the Limited Partners in
excess of a majority of the Percentage Interests of the Limited Partners be
required for the approval of the plan of merger, plan of exchange or plan of
conversion.

(d)           The General Partner shall notify each Limited Partner, whether or
not entitled to vote, of the meeting of the Limited Partners at which the plan
of merger, plan of exchange or plan of conversion is to be submitted for
approval in accordance with this Section 12.02 and applicable law.  The notice
shall be given at least twenty (20) days before the meeting and shall state that
the purpose, or one of the purposes, of the meeting is to consider the plan of
merger, plan of exchange or plan of conversion and shall contain or be
accompanied by a copy or summary of the plan.  Any such approval may be by
written consent of the requisite Limited Partners as would be required to
approve the plan at any meeting where all the Limited Partners are present.

(e)           Unless the General Partner (acting pursuant to Section 12.02(c))
requires a greater vote, the vote of the Limited Partners required for approval
of a plan of merger, plan of exchange or plan of conversion shall be the
affirmative vote of the holders of more than 50% of the Percentage Interests of
the Limited Partners entitled to vote thereon.

(f)            Unless applicable law otherwise requires (in which case the
approval of the Limited Partners shall continue to be required and the foregoing
provisions of this Section 12.02 shall continue to apply), (1) approval by the
Limited Partners on a plan of exchange shall not be required, and the foregoing
provisions of this Section 12.02 do not apply, if the Partnership is the

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acquiring entity in the plan of exchange, and (2) approval by the Limited
Partners on a plan of merger or a plan of conversion shall not be required and
the foregoing provisions of this Section 12.02 do not apply, if:

(i)            a limited partnership is the sole surviving or resulting entity;

(ii)           the partnership agreement of the surviving or resulting limited
partnership will not materially differ from this Agreement before the merger or
conversion in any manner other than as to applicable law or other insignificant
conforming differences;

(iii)          Limited Partners who held Limited Partnership Interests
immediately before the effective date of the merger or conversion will hold
interests in the surviving or resulting entity in the same proportions,
immediately after the effective date of the merger or conversion; and

(iv)          the General Partner adopts a resolution approving the plan of
merger or plan of conversion.

(g)           After a plan of merger, plan of exchange or plan of conversion is
approved, and at any time before the merger, exchange or conversion has become
effective, the plan of merger, plan of exchange or plan of conversion may be
abandoned (subject to any contractual rights by any of the entities that are a
party thereto), without action by the Limited Partners, in accordance with the
procedures set forth in the plan of merger, plan of exchange or plan of
conversion or, if no such procedures are set forth in the plan, in the manner
determined by the General Partner.

12.03      RIGHTS OF DISSENTING LIMITED PARTNERS.

(a)           In the absence of fraud in the transaction, the remedy provided by
this Section 12.03 to a Limited Partner voting against any merger, exchange or
conversion or objecting to a merger, exchange or conversion approved by the
written consent of Limited Partners (a “Dissenting Limited Partner”) is the
exclusive remedy for the recovery of the value of his Limited Partnership
interests or money damages with respect to the transaction.  If the existing,
surviving, or new corporation or limited partnership (foreign or domestic) or
other entity, as the case may be, complies with the requirements of this Section
12.03, any Dissenting Limited Partner who fails to comply with the requirements
of this Section 12.03 shall not be entitled to bring suit for the recovery of
the value of his Limited Partnership interests or money damages with respect to
the transaction.  A “Dissenting Limited Partner” in respect of any merger,
exchange or conversion shall expressly exclude any Limited Partner who votes in
favor of the related plan of merger, plan of exchange or plan of conversion or
who abstains or fails to timely vote therefor.  In the event of a plan of
merger, plan of exchange or plan of conversion approved by written consent, a
“Dissenting Limited Partner” in respect of any related merger, exchange or
conversion shall expressly exclude Limited Partners who provide such written
consent and Limited Partners who fail to object to the merger, exchange or
conversion and demands payment for such Limited Partner’s Limited Partnership
Interest in writing to the General Partner within twenty (20) days after notice
to the Limited Partners of the receipt by the Partnership of written consents
sufficient to approve such merger, exchange or conversion.  All such Limited
Partners who are not included within the definition of Dissenting Limited
Partner in respect of any

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merger, exchange or conversion shall participate in the merger, exchange or
conversion according to the approved plan of merger, plan of exchange or plan of
conversion.

(b)           Any Dissenting Limited Partner who has opted for payment for his
Limited Partnership interests shall not thereafter be entitled to vote or
exercise any other rights of a Limited Partner except the right to receive
payment for his Limited Partnership interests and the right to maintain an
appropriate action to obtain relief on the ground that the transaction would be
or was fraudulent.  Limited Partnership Interests of Dissenting Limited Partners
for which payment has been made shall not thereafter be considered outstanding
for the purposes of any subsequent vote of the Limited Partners.

(c)           Within twenty (20) days after a Dissenting Limited Partner votes
against any plan of merger, plan of exchange or plan of conversion which is
approved by a vote of the Limited Partners, or in connection with a Limited
Partner’s objection to any plan of merger, plan of exchange or plan of
conversion approved by the written consent of the Limited Partners, the
Dissenting Limited Partner may demand by written notice to the General Partner
that payment for his Limited Partnership Interest be made.  Upon receipt of such
a payment demand, the General Partner shall (i) make a notation on the records
of the Partnership that such demand has been made and (ii) within a reasonable
period of time after the later of the receipt of a payment demand or the
consummation of the merger, exchange or conversion, cause the Partnership to pay
to the Dissenting Limited Partner the fair value of such Dissenting Limited
Partner’s Partnership Interest without interest.  The fair value of a Dissenting
Limited Partner’s Partnership Interest shall be an amount equal to the
Dissenting Limited Partner’s pro rata share (as would be determined under
Section 5.06 hereof if the Partnership were liquidating) of the appraised value
of the net assets of the Partnership based on an appraisal of all assets of the
Partnership from a Competent Independent Expert.  The assets of the Partnership
shall be appraised on a consistent basis.  The appraisal shall be based on an
evaluation of all relevant information and shall include the current value of
the Partnership’s assets as of the date immediately prior to the proposed
merger, exchange or conversion.  The appraisal shall assume an orderly
liquidation of the Partnership’s assets over a twelve (12) month period, shall
consider other balance sheet items, and shall be net of the assumed cost of
sale.  The terms of the engagement of the appraiser shall clearly state that the
engagement is for the benefit of the Partnership and its Limited Partners.  A
summary of the independent appraisal, including all material assumptions
underlying the appraisal, shall be provided to Dissenting Limited Partners in
connection with the payment of the fair value of their Limited Partnership
Interests.

(d)           If a Dissenting Limited Partner shall fail to make a payment
demand within the period provided in Section 12.03(c) hereof or, in respect of a
plan of merger, plan of exchange or plan of conversion approved by written
consent of the Limited Partners, shall fail to provide notice of dissent within
the period set forth in Section 12.03(a) hereof, such Dissenting Limited Partner
and all persons claiming under him shall be conclusively presumed to have
approved and ratified the merger, conversion or exchange and shall be bound
thereby, the right of such Dissenting Limited Partner to be paid the fair value
of his Limited Partnership Interest shall cease, and his status as a Limited
Partner shall be restored without prejudice to any proceedings which may have
been taken during the interim, and such Dissenting Limited Partner shall be
entitled to receive any distributions made to Limited Partners in the interim.

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12.04      ROLL-UP TRANSACTIONS.

If the Partnership adopts any plan of merger, plan of exchange or plan of
conversion which, if effected, would result in a “Roll-Up Transaction”, as
defined in the Articles of Incorporation, then any such transaction shall be
subject to and effected strictly in compliance with the provisions applicable to
Roll-Up Transactions set forth in Section 13.3 of the Articles of Incorporation.

ARTICLE XIII

GENERAL PROVISIONS

13.01      NOTICES.  ALL COMMUNICATIONS REQUIRED OR PERMITTED UNDER THIS
AGREEMENT SHALL BE IN WRITING AND SHALL BE DEEMED TO HAVE BEEN GIVEN WHEN
DELIVERED PERSONALLY OR UPON DEPOSIT IN THE UNITED STATES MAIL, REGISTERED,
POSTAGE PREPAID RETURN RECEIPT REQUESTED, IF TO THE GENERAL PARTNER, AT 15601
DALLAS PARKWAY, SUITE 600, ADDISON, TEXAS 75001, IF TO ANY OTHER PARTNER, AT
SUCH ADDRESS SET FORTH IN EXHIBIT A ATTACHED HERETO; PROVIDED, HOWEVER, THAT ANY
PARTNER MAY SPECIFY A DIFFERENT ADDRESS BY NOTIFYING THE GENERAL PARTNER IN
WRITING OF SUCH DIFFERENT ADDRESS.  NOTICES TO THE PARTNERSHIP SHALL BE
DELIVERED AT OR MAILED TO ITS SPECIFIED OFFICE.

13.02      SURVIVAL OF RIGHTS.  SUBJECT TO THE PROVISIONS HEREOF LIMITING
TRANSFERS, THIS AGREEMENT SHALL BE BINDING UPON AND INURE TO THE BENEFIT OF THE
PARTNERS AND THE PARTNERSHIP AND THEIR RESPECTIVE LEGAL REPRESENTATIVES,
SUCCESSORS, TRANSFEREES AND ASSIGNS.

13.03      ADDITIONAL DOCUMENTS.  EACH PARTNER AGREES TO PERFORM ALL FURTHER
ACTS AND EXECUTE, SWEAR TO, ACKNOWLEDGE AND DELIVER ALL FURTHER DOCUMENTS WHICH
MAY BE REASONABLE, NECESSARY, APPROPRIATE OR DESIRABLE TO CARRY OUT THE
PROVISIONS OF THIS AGREEMENT OR THE ACT.

13.04      SEVERABILITY.  IF ANY PROVISION OF THIS AGREEMENT SHALL BE DECLARED
ILLEGAL, INVALID, OR UNENFORCEABLE IN ANY JURISDICTION, THEN SUCH PROVISION
SHALL BE DEEMED TO BE SEVERABLE FROM THIS AGREEMENT (TO THE EXTENT PERMITTED BY
LAW) AND IN ANY EVENT SUCH ILLEGALITY, INVALIDITY OR UNENFORCEABILITY SHALL NOT
AFFECT THE REMAINDER HEREOF.

13.05      ENTIRE AGREEMENT.  THIS AGREEMENT AND EXHIBITS ATTACHED HERETO
CONSTITUTE THE ENTIRE AGREEMENT OF THE PARTNERS AND SUPERSEDE ALL PRIOR WRITTEN
AGREEMENTS (INCLUDING, WITHOUT LIMITATION, THE ORIGINAL AGREEMENT) AND PRIOR AND
CONTEMPORANEOUS ORAL AGREEMENTS, UNDERSTANDINGS AND NEGOTIATIONS WITH RESPECT TO
THE SUBJECT MATTER HEREOF, EXCEPT AS OTHERWISE SET FORTH HEREIN.

13.06      PRONOUNS AND PLURALS.  WHEN THE CONTEXT IN WHICH WORDS ARE USED IN
THE AGREEMENT INDICATES THAT SUCH IS THE INTENT, WORDS IN THE SINGULAR NUMBER
SHALL INCLUDE THE PLURAL AND THE MASCULINE GENDER SHALL INCLUDE THE NEUTER OR
FEMALE GENDER AS THE CONTEXT MAY REQUIRE.

13.07      HEADINGS.  THE ARTICLE AND SECTION HEADINGS IN THIS AGREEMENT ARE FOR
CONVENIENCE ONLY AND SHALL NOT BE USED IN CONSTRUING THE SCOPE OF THIS AGREEMENT
OR ANY PARTICULAR ARTICLE OR SECTION HEREOF.

13.08      COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED IN SEVERAL
COUNTERPARTS, EACH OF WHICH SHALL BE DEEMED TO BE AN ORIGINAL COPY AND ALL OF
WHICH TOGETHER SHALL CONSTITUTE ONE AND THE

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SAME INSTRUMENT BINDING ON ALL PARTIES HERETO, NOTWITHSTANDING THAT ALL PARTIES
SHALL NOT HAVE SIGNED THE SAME COUNTERPART.

13.09      GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS; PROVIDED, HOWEVER, THAT ANY
CAUSE OF ACTION FOR VIOLATION OF FEDERAL OR STATE SECURITIES LAW SHALL NOT BE
GOVERNED BY THIS SECTION 13.09.

13.10      ARBITRATION.  NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN
THIS AGREEMENT, ALL CLAIMS, DISPUTES AND CONTROVERSIES BETWEEN THE PARTIES
HERETO (INCLUDING, WITHOUT LIMITATION, ANY CLAIMS, DISPUTES AND CONTROVERSIES
BETWEEN THE PARTNERSHIP AND ANY ONE OR MORE OF THE PARTNERS AND BETWEEN OR AMONG
ANY PARTNERS) ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR THE
PARTNERSHIP CREATED HEREBY, OR ANY ACT OR FAILURE TO ACT BY THE COMPANY, THE
GENERAL PARTNER OR ANY OTHER PARTNER HEREUNDER, SHALL BE RESOLVED BY BINDING
ARBITRATION IN DALLAS, TEXAS BY THE AMERICAN ARBITRATION ASSOCIATION (THE
“AAA”), IN ACCORDANCE WITH THIS SECTION 13.10.  ANY ARBITRATION CALLED FOR BY
THIS SECTION 13.10 SHALL BE CONDUCTED IN ACCORDANCE WITH THE FOLLOWING
PROCEDURES:

(a)           Any party hereto (the “Requesting Party”) may demand arbitration
pursuant to this Section 13.10 at any time by giving written notice of such
demand (the “Demand Notice”) to all other Partners and (if the Requesting Party
is not the Partnership) to the Partnership which Demand Notice shall describe in
reasonable detail the nature of the claim, dispute or controversy.

(b)           Within 15 days after the giving of a Demand Notice or such
additional time as required by the AAA, the AAA shall select and designate in
writing three reputable, disinterested individuals willing to act as an
arbitrator of the claim, dispute or controversy in question.

(c)           The presentations of the parties hereto in the arbitration
proceeding shall be commenced and completed within sixty (60) days after the
selection of the arbitration panel pursuant to subsection (b) above, and the
arbitration panel shall render its decision (and specify in reasonable detail
its reasons therefor) in writing within thirty (30) days after the completion of
such presentations.  Any decision concurred in by any two (2) of the arbitrators
shall constitute the decision of the arbitration panel, and unanimity shall not
be required.

(d)           The arbitration panel shall include in its decision a direction
that all of the attorneys’ fees and costs of any party or parties and the costs
of such arbitration be paid by the losing party or parties in the arbitration. 
On the application of a party before or after the initial decision of the
arbitration panel, and proof of its attorneys’ fees and costs, the arbitration
panel shall order the other party to make any payments directed pursuant to the
preceding sentence.

Any decision rendered by the arbitration panel in accordance herewith shall be
final and binding on the parties hereto, and judgment thereon may be entered by
any state or federal court of competent jurisdiction.  Arbitration shall be the
exclusive method available for resolution of claims, disputes and controversies
arising between and among the parties relating to this Agreement and the conduct
of the parties hereto in relation to Partnership matters, and the Company, the
Partnership and its Partners stipulate that the provisions hereof shall be a
complete defense to any suit, action or proceeding in any court or before any
administrative or arbitration

55

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tribunal with respect to any such claim, controversy or dispute.  The provisions
of this Section 13.10 shall survive the dissolution of the Partnership.

Nothing contained herein shall be deemed to give the arbitrators any authority,
power or right to alter, change, amend, modify, add to, or subtract from any of
the provisions of this Agreement.

13.11      VOTE OF AFFILIATED LIMITED PARTNERS.  NOTWITHSTANDING ANY PROVISION
TO THE CONTRARY SET FORTH IN THIS AGREEMENT, IN EACH INSTANCE IN WHICH THE
CONSENT, APPROVAL OR VOTE OF LIMITED PARTNERS IS REQUIRED HEREUNDER, ANY
PARTNERSHIP INTEREST HELD AS A LIMITED PARTNER BY ANY AFFILIATE OF THE SPONSOR
SHALL NOT BE INCLUDED FOR PURPOSES OF CALCULATING WHETHER THE REQUISITE APPROVAL
OF PARTNERS IS OBTAINED UNLESS, AS OF THE DATE OF DETERMINATION, THERE ARE NO
LIMITED PARTNERS ENTITLED TO VOTE OR CONSENT WHO ARE NOT AFFILIATES OF THE
SPONSOR.

13.12      ACKNOWLEDGEMENT AS TO EXCULPATION AND INDEMNIFICATION.  THE PARTIES
HERETO ACKNOWLEDGE AND AGREE THAT THIS AGREEMENT CONTAINS EXCULPATION AND
INDEMNIFICATION IN RESPECT OF THE ACTIONS OR OMISSIONS OF THE GENERAL PARTNER
AND DIRECTORS, OFFICERS AND AFFILIATES OF THE GENERAL PARTNER BY THE PARTNERSHIP
EVEN IF SUCH ACTIONS OR OMISSIONS CONSTITUTE NEGLIGENCE OF SUCH PERSONS.

[Signature Pages Follow]

56

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IN WITNESS WHEREOF, the parties hereto have hereunder affixed their signatures
to this Second Amended and Restated Agreement of Limited Partnership of
Behringer Harvard Operating Partnership I LP as of the date first above written.

GENERAL PARTNER:

BHR, INC.

By:

/s/ Gerald J. Reihsen, III

 

 

 

Gerald J. Reihsen, III

 

 

 

Secretary

 

 

 

ORIGINAL LIMITED PARTNERS:

BHR BUSINESS TRUST

By:

BHR BT, Inc., a Delaware corporation, its Sole Trustee

 

 

 

 

 

 

 

By:

/s/ Gerald J. Reihsen, III

 

 

 

 

Gerald J. Reihsen, III

 

 

 

 

Secretary

 

 

 

BHR PARTNERS, LLC

By:

/s/ Gerald J. Reihsen, III

 

 

 

Gerald J. Reihsen, III

 

 

 

Executive Vice President — Corporate Development &

 

 

 

Legal and Secretary

 

 

 

COMPANY:

BEHRINGER HARVARD REIT I, INC.

By:

/s/ Gerald J. Reihsen, III

 

 

 

Gerald J. Reihsen, III

 

 

 

Executive Vice President — Corporate Development &

 

 

 

Legal and Secretary

 

 

 

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

LIMITED PARTNERS:

MCCORMICK FAMILY TRUST 1/20/82

By:

/s/ Michael R. McCormick

 

 

 

Michael R. McCormick

 

 

 

Trustee

 

 

 

GARY S. CARR

By:

/s/ Gary S. Carr

 

 

 

Gary S. Carr

 

 

 

 

 

 

 

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

EXHIBIT A

LIMITED PARTNERS AND LIMITED PARTNERS’ CAPITAL CONTRIBUTIONS
AND PARTNERSHIP UNITS

As of January 1, 2007

Partners

 

 

 

Cash
Contribution

 

Agreed Value
of Property
Contribution

 

Partnership
Units

 

 

 

 

 

 

 

 

 

General Partner:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BHR, Inc.

 

$

170

*

N/A

 

17

 

15601 Dallas Parkway, Suite 600

 

 

 

 

 

 

 

Addison, TX 75001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Original Limited Partners:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BHR Business Trust

 

$

1,021,958,580

*

N/A

 

107,356,886.51

**

15601 Dallas Parkway, Suite 600

 

 

 

 

 

 

 

Addison, TX 75001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BHR Partners, LLC

 

$

139,357,988

 

N/A

 

14,639,575.30

**

15601 Dallas Parkway, Suite 600

 

 

 

 

 

 

 

Addison, TX 75001

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Limited Partners:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

McCormick Family Trust 1/20/82

 

N/A

 

***

 

185,394

 

c/o McCormick Construction

 

 

 

 

 

 

 

2507 Empire Ave.

 

 

 

 

 

 

 

Burbank, CA 91504

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gary S. Carr

 

N/A

 

***

 

247,192

 

2560 Peninsula Road

 

 

 

 

 

 

 

Channel Island Harbor, CA 93035

 

 

 

 

 

 

 

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

*       Amount contributed by the predecessor in interest of the respective
entity.

**    Such amount will be automatically adjusted from time to time as provided
in the definition of “Partnership Unit” contained in Article I.

***  Each Limited Partnership Unit issued to the respective Limited Partner was
issued for value in connection with that certain Purchase/Contribution Agreement
effective as of May 10, 2005, as amended, by an between Ryanco Partners Ltd. No.
X, a California limited partnership, and the Partnership relating to the
purchase of an office building located at 2411 West Olive Avenue, Burbank,
California commonly referred to as Buena Vista Plaza.

 

A-1

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EXHIBIT B

NOTICE OF EXERCISE OF EXCHANGE RIGHT

In accordance with the Second Amended and Restated Agreement of Limited
Partnership of Behringer Harvard Operating Partnership I LP, as amended (the
“Agreement”), the undersigned hereby irrevocably (i) presents for exchange
___________ Partnership Units in Behringer Harvard Operating Partnership I LP in
accordance with the terms of the Agreement and the Exchange Right referred to
therein; (ii) surrenders such Partnership Units and all right, title and
interest therein; and (iii) directs that the Cash Amount or REIT Shares Amount
(as defined in the Agreement) as determined by the General Partner deliverable
upon exercise of the Exchange Right be delivered to the address specified below,
and if REIT Shares (as defined in the Agreement) are to be delivered, such REIT
Shares be registered or placed in the name(s) and at the address(es) specified
below.

Dated:

 

 

 

 

 

 

 

(Signature of Limited Partner)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Printed Name of Limited Partner)

 

 

 

 

 

 

 

 

 

Mailing Address and Phone No.:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(        )

 

 

-

 

 

 

Signature Guaranteed by:

 

 

 

 

If REIT Shares are to be issued, issue to:

 

 

 

 

 

Name:

 

 

 

 

 

Mailing Address and Phone No.:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(       )

 

 

-

 

 

 

 

 

Social security or other tax identification number:

 

 

 

B-1

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

EXHIBIT C

CALL NOTICE

In accordance with the Second Amended and Restated Agreement of Limited
Partnership of Behringer Harvard Operating Partnership I LP, as amended (the
“Agreement”), the undersigned hereby irrevocably exercises its Call Right (as
defined in the Agreement) with regard to all of the Partnership Units owned by
_______________________ in Behringer Harvard Operating Partnership I LP.  The
undersigned shall pay the [Cash Amount/REIT Shares Amount] to
_____________________ at the notice address of provided in the Agreement upon
receipt of (i) the duly executed Partnership Unit Certificate of
______________________________ transferring all right, title and interest in
Partnership Units to the undersigned, (ii) if REIT Shares are to be delivered,
instructions as to the name, address and taxpayer identification number of the
person to whom such REIT Shares will be registered or placed, and (iii) the
representation, warranty and certification of that ___________________________
(a) has marketable and unencumbered title to such Partnership Units, free and
clear of the rights of or interests of any other person or entity; (b) has the
full right, power and authority to transfer and surrender such Partnership Units
as provided herein; and (c) has obtained the consent or approval of all persons
or entities, if any, having the right to consent to or approve of such transfer
and surrender.

 

 

BEHRINGER HARVARD REIT I, INC.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

 

 

 

 

C-1

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