EXHIBIT 10.28

 

AMENDMENT NO. 6 TO REVOLVING CREDIT AGREEMENT

 

This Amendment No. 6 to Revolving Credit Agreement (this “Amendment No. 6”) is
made and entered into and has an effective date as of the 11th day of March,
2008, by and among WHITESTONE REIT OPERATING PARTNERSHIP, LP f/k/a HARTMAN REIT
OPERATING PARTNERSHIP, LP (“Whitestone OP”), WHITESTONE REIT OPERATING
PARTNERSHIP III, L.P. f/k/a HARTMAN REIT OPERATING PARTNERSHIP III, L.P.
(“Whitestone III”) and the Subsidiaries of Whitestone OP and/or Whitestone III
which are listed on Schedule 1 (as such Schedule 1 may be amended from time to
time) (Whitestone OP, Whitestone III and any such Subsidiary being hereinafter
referred to collectively as the “Borrower” unless referred to in their
individual capacities) to a certain Revolving Credit Agreement, dated as of
March 11, 2005 (as amended, the “Credit Agreement”), each having its principal
place of business at 2600 South Gessner, Suite 500, Houston, Texas 77063,
KEYBANK NATIONAL ASSOCIATION (“KeyBank”), having a principal place of business
at 127 Public Square, Cleveland, Ohio 44114, and certain other lenders
individually and in certain agent capacities (collectively with KeyBank, the
“Lenders”) and KeyBank, as administrative agent for itself and each other Lender
(the “Agent”).

 

WHEREAS, the Borrower has requested certain amendments to the Credit Agreement,
including an extension of the maturity date, as set forth herein.

 

NOW, THEREFORE, in consideration of One Dollar ($1.00) and other good and
valuable consideration by each of the parties hereto, the receipt and
sufficiency of which are hereby acknowledged, it is agreed as follows:

 

 

1.

Capitalized terms used but not defined herein shall have the respective meanings
assigned to such terms in the Credit Agreement.

 

2.

References to the Borrower and Guarantor in the Loan Documents.

 

(a)

All references in the Loan Documents to Hartman REIT Operating Partnership, LP
shall be deemed to refer to Whitestone REIT Operating Partnership, LP.

 

(b)

All references in the Loan Documents to Hartman REIT Operating Partnership III,
L.P. shall be deemed to refer to Whitestone REIT Operating Partnership III, L.P.

 

(c)

All references in the Loan Documents to Hartman REIT Operating Partnership III
GP LLC shall be deemed to refer to Whitestone REIT Operating Partnership III GP
LLC.

 

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(d)

All references in the Loan Documents to Hartman Commercial Properties REIT shall
be deemed to refer to Whitestone REIT.

 

3.

Amendments to Credit Agreement. Effective from and after March 11, 2008:

 

(a)

The term Loan Documents shall include this Amendment No. 6 to Revolving Credit
Agreement, dated as of March 11, 2008, among the Borrower, the Lenders and the
Agent.

 

(b)

The definition of “Applicable Base Rate Margin” is amended to read in its
entirety as follows:

“Applicable Base Rate Margin. The Applicable Base Rate Margin is 1.625%.”

 

(c)

The definition of “Applicable Libor Margin” is amended to read in its entirety
as follows:

“Applicable Libor Margin. The Applicable Libor Margin is 2.625%.”

 

(d)

Clause (iv) contained in the definition of “Eligible Unencumbered Property(ies)”
is amended to read in its entirety as follows:

“(iv) is wholly-owned in fee simple by Whitestone III”.

 

(e)

Clause (vi) contained in the definition of “Eligible Unencumbered Property(ies)”
is amended to read in its entirety as follows:

“(vi) does not comprise more than 15% of total Borrowing Base Asset Value
(except that one, but not more than one, Eligible Unencumbered Property may
comprise up to 20% of total Borrowing Base Asset Value)”.

 

(f)

The definition of “Financial Statement Date” is amended to read in its entirety
as follows:

“Financial Statement Date. September 30, 2007.”

 

(g)

The definition of “Maturity Date” is amended to read in its entirety as follows:

“Maturity Date. October 1, 2008, or such earlier date on which the Revolving
Credit Loans shall become due and payable pursuant to the terms hereof.”

 

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(h)

The definition of “Mortgage Constant” is amended to read in its entirety as
follows:

“Mortgage Constant. As at any date of determination, a ratio that represents the
payment of principal and interest on an amortizing mortgage loan based on (i) an
interest rate equal to the greater of (a) the actual weighted average interest
rate on the Loans, (b) the then 10-year treasury rate plus 2.25% and based on a
25-year mortgage-style amortization schedule and (c) 7.25%.”

 

(i)

The definition of “Revolving Credit Notes” is amended by deleting the reference
to “$50,000,000” contained therein and by replacing it with the following:
“$75,000,000”.

 

(j)

The second sentence of the definition of “Total Commitment” is amended to read
in its entirety as follows:

“As of the Sixth Amendment Date, the Total Commitment is $75,000,000.”

 

(k)

Section 1.1 of the Credit Agreement is amended by inserting, in the appropriate
alphabetical order, the following new definitions:

“Sixth Amendment. Amendment No. 6 to Revolving Credit Agreement, dated as of
March 11, 2008, among the Borrower, the Lenders and the Agent.”

“Sixth Amendment Date. March 11, 2008.”

 

(l)

Section 2.3(c) of the Credit Agreement is deleted in its entirety.

 

(m)

Section 2.3(e) of the Credit Agreement is amended to read in its entirety as
follows:

“The Borrower agrees to pay to the Agent, for the accounts of the Lenders in
accordance with their respective Commitment Percentages, from the Closing Date
through the Maturity Date, a facility fee (the “Facility Fee”) calculated at the
rate of (i) for any day when the outstanding principal balance of the Loans is
less than or equal to 50% of the Total Commitment, 0.30% per annum, and (ii) for
any day when the outstanding principal balance of the Loans is greater than 50%
of the Total Commitment, 0.15% per annum, in each case calculated on the average
daily amount, during each fiscal quarter or portion thereof, of the unborrowed
portion of the Total Commitment. The Facility Fee shall be payable quarterly in
arrears on the first Business Day of each calendar quarter for the immediately
preceding calendar quarter commencing on the first

 

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such date following the Closing Date through the Maturity Date, with a final
payment on the Maturity Date.”

 

(n)

Clause (a) of Section 7.3 of the Credit Agreement is amended by deleting the
reference to “The Borrower” contained therein and be replacing it with the
following: “Whitestone III”.

 

(o)

Section 7.4 of the Credit Agreement is amended by deleting the reference to
“December 31, 2003” and by replacing it with “December 31, 2006” and by deleting
the reference to “September 30, 2004 and by replacing it with the “September 30,
2007”.

 

(p)

Section 7.21 of the Credit Agreement is amended by inserting, immediately
following the reference to “December 31, 2004” contained therein, the following:
“or December 31, 2005, December 31, 2006 or December 31, 2007”.

 

(q)

Section 9.1(i) of the Credit Agreement is amended by deleting the first
parenthetical contained therein and replacing it with the following
parenthetical: “(but not any other Borrower)”.

 

(r)

Section 9.4(b) of the Credit Agreement is amended to insert the following new
sentence at the end thereof:

“Notwithstanding the foregoing or any other provision of this Agreement, in the
event that the Borrower sells, transfers otherwise disposes of any Eligible
Unencumbered Property, or obtains financing for any Eligible Unencumbered
Property, and as a result of any thereof, removes such Eligible Unencumbered
Property from the Borrowing Base Pool, the Borrower shall retain and/or reinvest
in Whitestone III, [within 120 days after receipt thereof], the proceeds of such
sale, transfer, disposition or refinancing (net of customary fees and
expenses).”

 

(s)

Sections 9.6(a) and 9.6(b) of the Credit Agreement are amended to read in its
entirety as follows:

“(a) The Borrower will not declare (nor will the Borrower at a subsequent date
make) (i) quarterly Distributions in an amount in excess of the amount of
quarterly Distributions declared and made with respect to the fiscal quarter
ended December 31, 2007, provided that in the event that the number of shares of
the Trust issued and outstanding as of the Sixth Amendment Date is reduced, the
amount of permitted Distributions shall be reduced by the amount of such
Distributions that would be attributable to the shares that are no longer
outstanding; or (ii) any Distributions

 

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during any period after any Event of Default has occurred; provided, however,
that (a) unless an Event of Default under Section 14.1(g) or (h) has occurred or
the Lenders have not been paid in full in cash on the Maturity Date (or
otherwise refinanced in a manner acceptable to the Agent and the Lenders in
their sole discretion), the Borrower may at all times (including while any other
Event of Default not described above is continuing) make Distributions to the
minimum extent (after taking into account all available funds of the Trust from
all other sources) required in order to enable the Trust to continue to qualify
as a REIT.”

“(b) The Trust will not, during any period when any Event of Default has
occurred and is continuing, make any Distributions in excess of the minimum
Distributions (after taking into account all available funds of the Trust from
all other sources) required to be made by the Trust in order to maintain its
status as a REIT, provided that in the event of an Event of Default under
Section 14.1(g) or (h) or the Lenders have not been paid in full in cash on the
Maturity Date (or otherwise refinanced in a manner acceptable to the Agent and
the Lenders in their sole discretion), the Trust will not declare or make any
Distributions.”

 

(t)

Section 10.2 of the Credit Agreement is amended by deleting the reference to
“2.00 to 1.0” contained therein and by replacing it with the following: “1.55 to
1.0”.

 

(u)

Section 10.3 of the Credit Agreement is amended by deleting the reference to
“1.50 to 1.0” contained therein and by replacing it with the following: “1.40 to
1.0”.

 

(v)

Section 10.7 of the Credit Agreement is amended by deleting the reference to
“ten (10)” contained therein and by replacing it with the following: “fifteen
(15)”.

 

(w)

Section 10.8 of the Credit Agreement is amended to read in its entirety as
follows:

“Consolidated Tangible Net Worth. As at the end of any fiscal quarter or any
other date of measurement, the Consolidated Tangible Net Worth of the Borrower
shall not be less than the sum of (i) 75% of the Consolidated Tangible Net Worth
of the Borrower reflected in the audited financial statements of the Borrower
for the fiscal year ending December 31, 2007, plus (ii) 75% of the aggregate
proceeds received by the Trust (net of fees and expenses customarily incurred in
transactions of such type) in connection with any offering of stock in the
Trust, plus (iii) 75% of

 

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the aggregate value of operating units issued by the Borrower in connection with
asset or stock acquisitions (valued at the time of issuance by reference to the
terms of the agreement pursuant to which such units are issued), provided that
issuances of operating units to the Trust in connection with additional capital
contributions made by the Trust in the Borrower shall be excluded from this
clause (iii), in each case after May 18, 2006 and on or prior to the date such
determination of Consolidated Tangible Net Worth is made, plus (iv) 50% of the
net income of the Borrower for such period.”

 

4.

The Borrower hereby represents and warrants as follows:

 

(a)

Representations in Credit Agreement. Both before and after giving effect to this
Amendment No. 6, each of the representations and warranties made by or on behalf
of the Borrower, the Trust or any of their respective Subsidiaries contained in
the Credit Agreement or any of the other Loan Documents, was true when made and
is true on and as of the date hereof with the same full force and effect as if
each of such representations and warranties had been made on the date hereof and
in this Amendment No. 6, except to the extent that such representations and
warranties relate expressly to an earlier date.

 

(b)

No Events of Default. No Default or Event of Default exists on the date hereof
(both before and after giving effect to this Amendment No. 6).

 

(c)

Binding Effect of Documents. This Amendment No. 6 has been duly executed and
delivered by the Borrower and the Trust and is in full force and effect as of
the date hereof, and the agreements and obligations of the Borrower contained
herein constitute legal, valid and binding obligations of the Borrower
enforceable against the Borrower in accordance with their respective terms.

 

5.

Conditions Precedent to Effectiveness. This Amendment No. 6 shall become
effective when each of the following conditions is met to the satisfaction of
the Agent:

 

(a)

receipt by the Agent of this Amendment No. 6 duly and properly authorized,
executed and delivered by each of the Borrowers and the Lenders;

 

(b)

receipt by the Agent of a Compliance Certificate demonstrating compliance with
the financial covenants contained in Section 10 of the Credit Agreement as of
December 31, 2007;

 

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(c)

receipt by the Agent of an officers’ or manager’s certificate dated as of the
date hereof signed by an officer or manager, as applicable, of each Borrower
certifying as to such matters as the Agent shall require and attaching
authorizing resolutions with respect to this Amendment No. 6;

 

(d)

receipt by the Agent of title reports as of a recent date on each of the
Eligible Unencumbered Properties evidencing no Liens thereon and evidencing a
recorded Negative Pledge Agreement in favor of the Agent with respect to each
such Eligible Unencumbered Property;

 

(e)

receipt by the Agent of each of the items set forth on the Closing Agenda
attached hereto as Annex 1;

 

(f)

receipt by the Agent of payment of the extension fees payable for the benefit of
the Lenders signatory hereto, which fee shall be fully-earned upon the
effectiveness hereof and shall be non-refundable for any reason;

 

(g)

receipt by the Agent of payment of any other fees due to the Agent, including
all of the Agent’s reasonable legal fees and expenses incurred in the connection
with the preparation and negotiation of this Amendment No. 6 or otherwise
outstanding; and

 

(h)

receipt by the Agent of any other documents, agreements, certificates or other
items requested by the Agent in connection with this Amendment No. 6.

 

6.

Provisions of General Application.

 

(a)

No Other Changes. Except as otherwise expressly provided by this Amendment No.
6, all of the terms, conditions and provisions of the Credit Agreement and each
of the other Loan Documents remain unaltered. The Credit Agreement and this
Amendment No. 6 shall be read and construed as one agreement.

 

(b)

Governing Law. This Amendment No. 6 is intended to take effect as a sealed
instrument and shall be deemed to be a contract under the laws of the State of
New York. This Amendment No. 6 and the rights and obligations of each of the
parties hereto shall be governed by and interpreted and determined in accordance
with the laws of the State of New York (excluding the laws applicable to
conflicts or choice of law).

 

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(c)

Binding Effect; Assignment. This Amendment No. 6 shall be binding upon and inure
to the benefit of each of the parties hereto and their respective successors in
title and assigns.

 

(d)

Counterparts. This Amendment No. 6 may be executed in any number of
counterparts, but all such counterparts shall together constitute but one and
the same agreement. In making proof of this Amendment No. 5, it shall not be
necessary to produce or account for more than one counterpart thereof signed by
each of the parties hereto.

 

(e)

Conflict with Other Agreements. If any of the terms of this Amendment No. 6
shall conflict in any respect with any of the terms of any of the Credit
Agreement or any other Loan Document, the terms of this Amendment No. 6 shall be
controlling.

 

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WITNESS the execution hereof, under seal, as of the day and year first written
above

 

KEYBANK NATIONAL ASSOCIATION,

as Agent and as a Lender

 

 

 

By:

____________________________

 

Name:
Title:

 

RBS CITIZENS, NATIONAL ASSOCIATION,

as a Lender

 

 

 

By:

____________________________

 

Name:
Title:

 

TRUSTMARK NATIONAL BANK,

as a Lender

 

 

 

By:

____________________________

 

Name:
Title:

 

MERCANTIL COMMERCE BANK, N.A.,

as a Lender

 

 

 

By:

____________________________

 

Name:
Title:

 

(Signatures continued on next page)

 

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WHITESTONE REIT OPERATING PARTNERSHIP, LP

 

 

By:

Whitestone REIT, a Maryland real estate investment trust, its sole general
partner

 

 

 

By:

____________________________

James C. Mastandrea, CEO

 

WHITESTONE REIT OPERATING PARTNERSHIP III, L.P.

 

 

By:

Whitestone REIT Operating Partnership III GP LLC, a Texas limited liability
company, its sole general partner

 

 

By:

Whitestone REIT Operating Partnership, LP, a Delaware limited partnership, its
sole member

 

 

By:

Whitestone REIT, a Maryland real estate investment trust, its sole member

 

 

 

By:

_________________________

 

James C. Mastandrea, CEO

 

 

WHITESTONE REIT OPERATING PARTNERSHIP III GP LLC, a Texas limited liability
company

 

 

By:

Whitestone REIT Operating Partnership, LP, a Delaware limited partnership, its
sole member

 

 

By:

Whitestone REIT, a Maryland real estate investment trust, its sole member

 

 

 

By:

____________________________

James C. Mastandrea, CEO

 

 

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HARTMAN REIT OPERATING PARTNERSHIP III LP LTD, a Texas limited partnership

 

 

By:

Whitestone REIT Operating Partnership III GP LLC, a Texas limited liability
company, its sole general partner

 

 

By:

Whitestone REIT Operating Partnership, LP, a Delaware limited partnership, its
sole member

 

 

By:

Whitestone REIT, a Maryland real estate investment trust, its sole general
partner

 

 

By:

_________________________

 

James C. Mastandrea, CEO

 

 

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Each Guarantor hereby acknowledges receipt of this Amendment No. 6, affirms its
obligations under the Guaranty, dated as of March 11, 2005, and agrees that all
“Obligations”, as defined in the Credit Agreement and after giving effect to
this Amendment No. 6, are Obligations under the Guaranty.

 

WHITESTONE REIT, a Maryland real estate investment trust, Guarantor

 

 

 

By:

_________________________________

James C. Mastandrea, CEO

 

WHITESTONE REIT OPERATING PARTNERSHIP III GP LLC, a Texas limited liability
company, Guarantor

 

 

By:

Whitestone REIT Operating Partnership, LP, a Delaware limited partnership, its
sole member

 

 

By:

Whitestone REIT, a Maryland real estate investment trust, its sole member

 

 

 

By:

____________________________

James C. Mastandrea, CEO

 

HARTMAN REIT OPERATING PARTNERSHIP III LP LTD, a Texas limited partnership,
Guarantor

 

 

By:

Whitestone REIT Operating Partnership III GP LLC, a Texas limited liability
company, its sole general partner

 

 

By:

Whitestone REIT Operating Partnership, LP, a Delaware limited partnership, its
sole member

 

 

By:

Whitestone REIT, a Maryland real estate investment trust, its sole general
partner

 

 

By:

_________________________

 

James C. Mastandrea, CEO

 

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