Exhibit
10.3


 


Execution Version


 


 


CREDIT AGREEMENT


 


Dated as of November 4, 2003


 


among


 


U.S.  RESTAURANT PROPERTIES OPERATING L.P. (“USRP Operating”),


USRP FUNDING 2002-A, L.P. (the
“General SPE”),


USRP (S&C), LLC, a Texas
limited liability company (“S&C”),


USRP (JV1), LLC, a Texas
limited liability company (“JV1”),


USRP/HCI PARTNERSHIP 1, L.P., a
Texas limited partnership (“HCI”),


USRP HOLDING CORP., a Texas
corporation (“USRP Holding),


collectively, the “Borrower,”


 


USRP MANAGING, INC. (the
“General Partner”),


the General Partner of the
Borrower, as a Guarantor,


 


U.S.  RESTAURANT PROPERTIES, INC. (the “USRP REIT”),


as a Guarantor,


 


and


 


THE SUBSIDIARIES OF THE
BORROWER, GENERAL PARTNER AND THE USRP REIT


FROM TIME TO TIME PARTY HERETO,


as guarantors (the “Guarantors”),


 


THE LENDERS


FROM TIME TO TIME PARTY HERETO
(the “Lenders”),


 


BANK OF AMERICA, N.A.


as agent (the “Agent”)


 


and


 


BANC OF AMERICA SECURITIES LLC,


as Sole Lead Arranger and Sole
Book Manager


 

















 


TABLE OF CONTENTS


 


	
  ARTICLE I 
  DEFINITIONS

  
	
  1.1

  	
  Definitions.

  
	
  1.2

  	
  Computation of Time
  Periods.

  
	
  1.3

  	
  Accounting Terms.

  
	
  1.4

  	
  References to Agreements
  and Laws.

  
	
  ARTICLE II 
  CREDIT FACILITIES

  
	
  2.1

  	
  Revolving Loans.

  
	
  2.2

  	
  Letter of Credit
  Subfacility.

  
	
  2.4

  	
  Joint and Several Liability of the Borrowers.

  
	
  2.5

  	
  Appointment of
  Principal Borrower as Agent for Borrowers.

  
	
  ARTICLE III  OTHER PROVISIONS RELATING TO CREDIT FACILITIES

  
	
  3.1

  	
  Default Rate.

  
	
  3.2

  	
  Continuation/Conversion.

  
	
  3.3

  	
  Prepayments.

  
	
  3.4

  	
  Termination, Reduction or Increase of Revolving
  Committed Amount.

  
	
  3.5

  	
  Fees.

  
	
  3.6

  	
  Capital Adequacy.

  
	
  3.7

  	
  Limitation on Eurodollar
  Loans.

  
	
  3.8

  	
  Illegality.

  
	
  3.9

  	
  Requirements of Law.

  
	
  3.10

  	
  Treatment of Affected
  Loans.

  
	
  3.11

  	
  Taxes.

  
	
  3.12

  	
  Compensation.

  
	
  3.13

  	
  Pro Rata Treatment.

  
	
  3.14

  	
  Sharing of Payments.

  
	
  3.15

  	
  Payments, Computations, Etc.

  
	
  3.16

  	
  Evidence of Debt.

  
	
  3.17

  	
  Usury.

  
	
  3.18

  	
  Agreement Regarding
  Interest and Charges.

  
	
  3.19

  	
  Statements of
  Account.

  
	
  3.20

  	
  Defaulting
  Lenders.

  
	
  3.21

  	
  Assumptions
  Concerning Funding of Eurodollar Loans.

  
	
  ARTICLE IV 
  GUARANTY

  
	
  4.1

  	
  The Guaranty.

  
	
  4.2

  	
  Obligations
  Unconditional.

  
	
  4.3

  	
  Reinstatement.

  
	
  4.4

  	
  Certain Additional Waivers.

  
	
  4.5

  	
  Remedies.

  
	
  4.6

  	
  Rights of Contribution.

  
	
  4.7

  	
  Guarantee of Payment;
  Continuing Guarantee.

  
	
  ARTICLE V 
  CONDITIONS

  
	
  5.1

  	
  Closing Conditions.

  
	
  5.2

  	
  Conditions to all
  Extensions of Credit.

  
	
  ARTICLE VI 
  REPRESENTATIONS AND WARRANTIES

  
	
  6.1

  	
  Financial Condition.

  
	
  6.2

  	
  No Material Change.

  
	
  6.3

  	
  Organization and
  Good Standing.

  
	
  6.4

  	
  Power; Authorization; Enforceable Obligations.

  
	
  6.5

  	
  No Conflicts.

  
	
  6.6

  	
  No Default.

  
	
  6.7

  	
  Ownership.

  
	
  6.8

  	
  Indebtedness.

  
	
  6.9

  	
  Litigation.

  
	
  6.10

  	
  Taxes.

  
	
  6.11

  	
  Compliance with Law.

  



 


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  6.12

  	
  ERISA.

  
	
  6.13

  	
  Corporate Structure;
  Capital Stock, etc.

  
	
  6.14

  	
  Governmental
  Regulations, Etc.

  
	
  6.15

  	
  Purpose of Loans, Letters of
  Credit and Derivative Exposure Reserve; Termination of Replaced Credit
  Agreement.

  
	
  6.16

  	
  Environmental
  Matters.

  
	
  6.17

  	
  Intellectual
  Property.

  
	
  6.18

  	
  Solvency.

  
	
  6.19

  	
  Investments.

  
	
  6.20

  	
  Principal Offices.

  
	
  6.21

  	
  Disclosure.

  
	
  6.22

  	
  No Burdensome
  Restrictions.

  
	
  6.23

  	
  Brokers’ Fees.

  
	
  6.24

  	
  Labor Matters.

  
	
  6.25

  	
  Nature of Business.

  
	
  6.26

  	
  REIT Status.

  
	
  6.27

  	
  Bankruptcy Remote Borrowing Entity.

  
	
  6.28

  	
  Closing Date Borrowing
  Base Assets.

  
	
  6.29

  	
  Tax Shelter Regulations.

  
	
  6.30

  	
  Representations and
  Warranties Under Term Loan Documents.

  
	
  ARTICLE VII  AFFIRMATIVE COVENANTS

  
	
  7.1

  	
  Information Covenants.

  
	
  7.2

  	
  Preservation of
  Existence, Franchises, Bankruptcy Remote Borrowing Entity Status and REIT
  Status.

  
	
  7.3

  	
  Books and Records.

  
	
  7.4

  	
  Compliance with Law.

  
	
  7.5

  	
  Payment of Taxes and Other
  Indebtedness.

  
	
  7.6

  	
  Insurance.

  
	
  7.7

  	
  Maintenance of
  Property.

  
	
  7.8

  	
  Performance of
  Obligations.

  
	
  7.9

  	
  Use of Proceeds.

  
	
  7.10

  	
  Audits/Inspections.

  
	
  7.11

  	
  Financial Covenants.

  
	
  7.12

  	
  New Subsidiaries.

  
	
  7.13

  	
  ERISA
  Exemptions.

  
	
  7.14

  	
  Further Assurances.

  
	
  ARTICLE VIII  NEGATIVE COVENANTS

  
	
  8.1

  	
  Indebtedness.

  
	
  8.2

  	
  Liens.

  
	
  8.3

  	
  Nature of Business.

  
	
  8.4

  	
  Consolidation,
  Merger, Dissolution, etc.

  
	
  8.5

  	
  Asset
  Dispositions/Substitution of Assets.

  
	
  8.6

  	
  Investments.

  
	
  8.7

  	
  Restricted Payments.

  
	
  8.8

  	
  Other Indebtedness.

  
	
  8.9

  	
  Transactions with Affiliates.

  



 


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  8.10

  	
  Fiscal Year; Organizational Documents.

  
	
  8.11

  	
  Limitation on Restricted
  Actions.

  
	
  8.12

  	
  Contingent Obligations.

  
	
  8.13

  	
  Sale Leasebacks.

  
	
  8.14

  	
  Borrowing
  Base Asset Removal

  
	
  8.15

  	
  Negative Pledges/Liens.

  
	
  8.16

  	
  Operating Lease Obligations.

  
	
  8.17

  	
  No Foreign Subsidiaries.

  
	
  8.18

  	
  Ground Leases.

  
	
  8.19

  	
  ERISA Exemptions.

  
	
  8.20

  	
  Transfer of Assets to
  Non-Guarantor Subsidiaries and Affiliates.

  
	
  8.21

  	
  Term Loan Document Covenants and Amendments.

  
	
  ARTICLE IX 
  EVENTS OF DEFAULT

  
	
  9.1

  	
  Events of Default.

  
	
  9.2

  	
  Acceleration; Remedies.

  
	
  ARTICLE X 
  AGENCY PROVISIONS

  
	
  10.1

  	
  Appointment, Powers and
  Immunities.

  
	
  10.2

  	
  Reliance by Agent.

  
	
  10.3

  	
  Defaults.

  
	
  10.4

  	
  Rights as a Lender.

  
	
  10.5

  	
  Indemnification.

  
	
  10.6

  	
  Non-Reliance on Agent and Other
  Lenders.

  
	
  10.7

  	
  Successor Agent.

  
	
  ARTICLE XI 
  MISCELLANEOUS

  
	
  11.1

  	
  Notices.

  
	
  11.2

  	
  Right of Set-Off;
  Adjustments.

  
	
  11.4

  	
  No Waiver; Remedies
  Cumulative.

  
	
  11.5

  	
  Expenses; Indemnification.

  
	
  11.6

  	
  Amendments, Waivers and
  Consents.

  
	
  11.7

  	
  Counterparts.

  
	
  11.8

  	
  Headings.

  
	
  11.9

  	
  Survival.

  
	
  11.10

  	
  Governing Law;
  Submission to Jurisdiction; Venue.

  
	
  11.11

  	
  Severability.

  
	
  11.12

  	
  Entirety.

  
	
  11.13

  	
  Binding Effect;
  Termination.

  
	
  11.14

  	
  Confidentiality.

  
	
  11.15

  	
  Source of Funds.

  
	
  11.16

  	
  Regulation D.

  
	
  11.17

  	
  Conflict.

  
	
  11.18

  	
  USA Patriot Act Notice

  



 


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  SCHEDULES

  
	
   

  	
   

  	
   

  
	
  Schedule 1.1(a)

  	
   

  	
  Revolving Commitments

  
	
  Schedule 2.1(a)

  	
   

  	
  Lenders/Agent

  



 


 


	
  EXHIBITS

  
	
   

  	
   

  	
   

  
	
  Exhibit 1.1(a)

  	
   

  	
  Bankruptcy Remote Borrowing Entity
  Requirements

  
	
  Exhibit 2.1(b)(i)

  	
   

  	
  Form of Notice of Borrowing

  
	
  Exhibit 2.1(e)

  	
   

  	
  Form of Revolving Note

  
	
  Exhibit 3.2

  	
   

  	
  Form of Notice of Continuation/Conversion

  
	
  Exhibit 7.1(c)

  	
   

  	
  Form of Officer’s Compliance Certificate

  
	
  Exhibit 7.12

  	
   

  	
  Form of Joinder Agreement

  
	
  Exhibit 11.3(b)

  	
   

  	
  Form of Assignment and Assumption

  



 


iv

















 


CREDIT AGREEMENT


 


THIS
CREDIT AGREEMENT, dated as of November 4, 2003 (as
amended, modified, restated or supplemented from time to time, the “Credit
Agreement”), is by and among U.S. 
RESTAURANT PROPERTIES OPERATING L.P., a Delaware limited
partnership (“USRP Operating” or the “Principal Borrower”), USRP FUNDING
2002-A, L.P., a Texas limited partnership (the “General SPE”); USRP
(S&C), LLC, a Texas limited liability company (“S&C”),
USRP
(JV1), LLC, a Texas limited liability company (“JV1”), USRP/HCI
PARTNERSHIP 1, L.P., a Texas limited partnership (“HCI”), USRP HOLDING
CORP., a Texas corporation (“USRP Holding”; and together with
the Principal Borrower, the General SPE, JV1, HCI and S&C, the “Borrower”),
USRP
MANAGING, INC., a Delaware corporation and the general partner of
USRP Operating, as a Guarantor (the “General Partner”), U.S.
RESTAURANT PROPERTIES, INC., a Maryland corporation, as a Guarantor (“USRP
REIT”), the Subsidiary Guarantors (as defined herein), the Lenders (as
defined herein), BANK OF AMERICA, N.A., as Agent for the Lenders (in such
capacity, the “Agent”) and as issuing lender (in such capacity, “Issuing
Lender”) and BANC OF AMERICA SECURITIES LLC, as Sole Lead Arranger and Sole
Book Manager (in such capacity “BAS”).


 


W I T N E S S E T H


 


WHEREAS,
the Borrowers have requested that the Lenders provide a revolving credit
facility in an aggregate amount equal to $50,000,000 (the “Credit Facility”)
for the purposes hereinafter set forth; and


 


WHEREAS,
the Lenders have agreed to make the requested Credit Facility available to the
Borrowers on the terms and conditions hereinafter set forth;


 


NOW,
THEREFORE, IN CONSIDERATION of the premises and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:


 


ARTICLE I


 


DEFINITIONS


 


1.1          Definitions.


 


As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:


 


“2001-A
Term Securitization Documents” means that certain Amended and Restated
Indenture dated as of August 1, 2001 by and among USRP Funding 2001-A, L.P., as
issuer, Wells Fargo Bank Minnesota, N.A., as indenture trustee and MBIA
Insurance Corporation, as certificate issuer and all documents and instruments
executed in connection therewith or pursuant to the terms thereof, in each case
as amended prior to the Closing Date.


 


“Adjusted
Base Rate” means the Base Rate plus 1.00%.


 


“Adjusted
Eurodollar Rate” means the Eurodollar Rate plus 3.00%.


 


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


 


“Affiliate”
means, with respect to any Person, any other Person (i) directly or
indirectly controlling or controlled by or under direct or indirect common
control with such Person or (ii) directly or indirectly owning or holding
five percent (5%) or more of the Capital Stock in such Person.  For purposes of this definition, “control”
when used with respect to any Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
“controlling” and “controlled” have meanings correlative to the foregoing.


 

















 


“Agent”
shall have the meaning assigned to such term in the heading hereof, together
with any successors or assigns.


 


“Aggregate Derivative Reserve Amount” means, at any given time,
an amount equal to the aggregate amount reserved in connection with all
Derivative Exposure Reserves in effect at such time.


 


“Applicable Law” means all applicable provisions of
constitutions, statutes, rules, regulations and orders of all governmental
bodies and all orders and decrees of all courts, tribunals and arbitrators.


 


“Applicable
Lending Office” means, for each Lender, the office of such Lender (or of an
Affiliate of such Lender) as such Lender may from time to time specify to the
Agent and the Borrower by written notice as the office by which its Eurodollar
Loans are made and maintained.


 


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


 


“Asset
Disposition” means any disposition (including pursuant to a Sale and
Leaseback Transaction) of any or all of the Property (including without
limitation the Capital Stock of a Subsidiary) of any Consolidated Party whether
by sale, lease (other than in the ordinary course of business), licensing,
transfer or otherwise, but other than pursuant to any casualty or condemnation
event.


 


“Asset
Value” means, with respect to any given parcel of Real Property for any
given date of calculation, (a) if such Real Property has been owned for at
least one (1) year, the trailing twelve month EBITDA from such Real Property as
of such date of calculation and (b) if such Real Property has been owned less
than one (1) year, the annualized EBITDA from such Real Property (based on the
EBITDA from the date of acquisition through such date of calculation), in each
case, capitalized at ten and one half percent (10.5%); provided, that (a)
the Agent shall have the right, at its discretion, to review the
appropriateness of the capitalization rate on an annual basis (such review
period to commence on May 1 of each calendar year and end as of June 1 of
such calendar year); (b) the Required Lenders shall have the right to adjust
the capitalization rate during the Agent’s review period each year (by an
amount not to exceed +/- 0.50% in any given year) based on then-prevailing
market conditions for comparable property types (each as determined by the
Required Lenders) and on the Agent’s review and recommendation; and (c) the
applicable capitalization rate shall not at any time, notwithstanding the
provisions regarding adjustment thereof set forth above, (i) exceed 11.5% or
(ii) be less than 9.5%.


 


“Assignment
and Assumption” means an assignment and assumption entered into by a Lender
and an Eligible Assignee (with the consent of any party whose consent is
required by Section 11.3, and accepted by the Agent, in substantially the form
of Exhibit 11.3 or any other form approved by the Agent.


 


“Availability” means, at any time, an amount (not less than
zero) equal to (a) the Revolving Committed Amount, less (b) the sum of
(i) the outstanding principal amount of the Revolving Loans, plus (ii)
the LOC Obligations, plus (iii) the Aggregate Derivative Reserve Amount.


 


“Bankruptcy
Code” means the Bankruptcy Code in Title 11 of the United States Code,
as amended, modified, succeeded or replaced from time to time.


 


“Bankruptcy
Event” means, with respect to any Person, the occurrence of any of the
following: (i) the entry of a decree or order for relief by a court or
governmental agency in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or the appointment
by a court or governmental agency of a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of such Person or for
any substantial part of its Property or the ordering of the winding up or
liquidation of its affairs by a court or governmental agency; or (ii) the
commencement against such Person of an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or of
any case, proceeding or other action for the appointment of a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar official) of
such Person or for any substantial part of its Property or for the winding up


 


2

















 


or liquidation of its affairs, and such
involuntary case or other case, proceeding or other action shall remain
undismissed for a period of sixty (60) consecutive days, or the
repossession or seizure by a creditor of such Person of a substantial part of
its Property; or (iii) such Person shall commence a voluntary case under
any applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or consent to the entry of an order for relief in an involuntary case
under any such law, or consent to the appointment of or the taking possession
by a receiver, liquidator, assignee, creditor in possession, custodian,
trustee, sequestrator (or similar official) of such Person or for any
substantial part of its Property or make any general assignment for the benefit
of creditors; or (iv) such Person shall be unable to, or shall admit in
writing its inability to, pay its debts generally as they become due.


 


“Bankruptcy
Remote Borrowing Entity” means a Person meeting
each of the criteria set forth on Exhibit 1.1(a) attached hereto.


 


“BAS” shall have the meaning given to such term in the introductory
paragraph hereof.


 


“Base Rate”
means, for any day, the rate per annum equal to the higher of (a) the
Federal Funds Rate for such day plus one-half of one percent (0.5%) and
(b) the Prime Rate for such day. 
Any change in the Base Rate due to a change in the Prime Rate or the
Federal Funds Rate shall be effective on the effective date of such change in
the Prime Rate or Federal Funds Rate.


 


“Base Rate
Loan” means any Loan bearing interest at a rate determined by reference to
the Base Rate.


 


“BOA” means
Bank of America, N.A. and its successors and assigns.


 


“BOA Derivative Instrument” means any derivative transaction,
hedging transaction, takeout commitment or forward equity commitment entered
into by and between the General Partner or the USRP REIT and any Derivative
Counterparty.


 


“Borrower”
means, collectively, USRP Operating, the General SPE, S&C, JV1, HCI, USRP
Holding and their respective permitted successors and assigns.


 


“Borrowing
Base” means, as of any day, an amount equal to fifty percent (50%)
multiplied by the Borrowing Base Asset Value; provided, however, that, prior to
such calculation, each of clauses (a) through (c) below shall be satisfied
with respect to the assets contributing to the Borrowing Base Asset Value:


 


(a)           the
assets of single Concepts or Tenants shall not, in any case, account for more
than twenty percent (20%) of the Total Rent; to the extent the assets of a
single Concept or Tenant account for more than twenty percent (20%) of the
Total Rent associated with the assets used in calculating Borrowing Base Asset
Value, the assets associated with such Concept or Tenant shall be removed from
the calculation of Borrowing Base Asset Value to the extent necessary to reduce
such Concept’s or Tenant’s percentage of the Total Rent of the assets used in
calculating Borrowing Base Asset Value to a portion equal to or less than
twenty percent (20%);


 


(b)           the
portion of Borrowing Base Asset Value attributable to Ground Lease Interests
shall not, in any case, exceed twenty percent (20%) of the aggregate
Borrowing Base Asset Value; to the extent Ground Lease Interests constitute
more than twenty percent (20%) of the Borrowing Base Asset Value, the
Value of such Ground Lease Interests shall be removed from the calculation
thereof to the extent necessary to reduce the percentage associated with the
Ground Lease Interests as a portion of all of the assets used in calculating
Borrowing Base Asset Value to a portion equal to or less than twenty
percent (20%); and


 


(c)           the
underlying leases with respect to the Borrowing Base Assets pursuant to which
Borrower is the lessor shall not, in any case, have a weighted average
remaining lease term of less than, (i) for the period commencing as of the date
hereof and ending as of (and including) the date 24 calendar months thereafter,
eight (8) years, (ii) for the period commencing as of the day after the
date which is 24 months following the date hereof and ending as of (and
including) the date 48 months following


 


3

















 


the date hereof, seven (7) years, and (iii)
for all periods thereafter, six (6) years; to the extent the weighted average
of the remaining lease term(s) of the underlying leases with respect to the
assets contributing to the Borrowing Base Asset Value (with each such lease’s
term given a weighting in relation to the other leases involved in such
calculation based on the contribution of each such lease to the Borrowing Base
Asset Value) is less than the applicable required term of years, assets with
remaining lease terms of less than the applicable required term of years shall
be removed from the calculation of Borrowing Base Asset Value until the
weighted average of the remaining lease terms with respect to all such assets
is equal to or greater than the applicable required term of years.


 


“Borrowing
Base Asset Value” means, as of any given calculation date, an amount equal
to (a) the sum of the Asset Values of all Real Properties which are wholly
owned by any of the General SPE, HCI (or Wholly-Owned Subsidiaries thereof),
HCI (or Wholly-Owned Subsidiaries thereof) or S&C; less (b) any
amounts included in the above calculations that are attributable to (i) assets
subject to one or more Liens or Negative Pledges; and (ii) Excluded Assets.


 


“Borrowing
Base Assets” means, as of any given date, those assets contributing to the
Borrowing Base Asset Value after the reductions made pursuant to
subclause (b) of the definition thereof.


 


“Borrowing
Base Certificate” shall have the meaning given to such term in
Section 7.1(k).


 


“Business
Day” means a day other than a Saturday, Sunday or other day on which
commercial banks in Charlotte, North Carolina or New York, New York are
authorized or required by law to close.


 


“Businesses”
means, at any time, a collective reference to the businesses operated by the
Consolidated Parties at such time.


 


“Capitalized Lease Obligation” means Indebtedness represented by
obligations under a Capital Lease, and the amount of such Indebtedness is the
capitalized amount of such obligations determined in accordance with GAAP.


 


“Capital
Lease” means, as applied to any Person, any lease of any Property (whether
real, personal or mixed) by that Person as lessee which, in accordance with
GAAP, is required to be accounted for as a capital lease on the balance sheet
of that Person.


 


“Capital
Stock” means (i) in the case of a corporation, capital stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (iii) in the case of a partnership, partnership units or
interests (whether general or limited), (iv) in the case of a limited
liability company, membership interests and (v) any other interest or
participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, the issuing Person.


 


“Cash
Equivalents” means, as at any date, (a) securities issued or directly
and fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than twelve
months from the date of acquisition, (b) Dollar denominated time deposits
and certificates of deposit of (i) any Lender, (ii) any domestic
commercial bank of recognized standing having capital and surplus in excess of
$500,000,000 or (iii) any bank whose short-term commercial paper rating
from S&P is at least A-1 or the equivalent thereof or from Moody’s is at
least P-1 or the equivalent thereof (any such bank being an “Approved Bank”),
in each case with maturities of not more than 270 days from the date of
acquisition, (c) commercial paper and variable or fixed rate notes issued
by any Approved Bank (or by the parent company thereof) or any variable rate
notes issued by, or guaranteed by, any domestic corporation rated A-1 (or the
equivalent thereof) or better by S&P or P-1 (or the equivalent thereof) or
better by Moody’s and maturing within six months of the date of acquisition,
(d) repurchase agreements entered into by any Person with a bank or trust
company (including any of the Lenders) or recognized securities dealer having
capital and surplus in excess of $500,000,000 for direct obligations issued by
or fully guaranteed by the United States in which such Person shall have a
perfected first priority security interest (subject to no other Liens) and
having, on the date of purchase thereof, a fair market


 


4

















 


value of at
least 100% of the amount of the repurchase obligations and
(e) Investments, classified in accordance with GAAP as current assets, in
money market investment programs registered under the Investment Company Act of
1940, as amended, which are administered by reputable financial institutions
having capital of at least $500,000,000 and the portfolios of which are limited
to Investments of the character described in the foregoing subdivisions (a)
through (d).


 


“Change in Management” means a change in the identity of the
Chief Executive Officer of the General Partner or the USRP REIT, other than on
account of the death or permanent disability of such Person.


 


“Change of
Control” means any of the following events: (a) the sale, lease, transfer
or other disposition, in one or a series of related transactions, of all or
substantially all of the assets of any of the Borrowers and such Borrower’s
Subsidiaries taken as a whole to any “person” or “group”  (within the meaning of Sections 13(d) and 14(d)(2)
of the Securities Exchange Act), or (b) the USRP REIT shall fail to own
and control (whether directly or indirectly) 80% of the outstanding Capital
Stock of any Borrower.  As used herein,
“beneficial ownership” shall have the meaning provided in Rule 13d-3 of
the Securities and Exchange Commission under the Securities Exchange Act.


 


“Closing
Date” means the date hereof.


 


“Code”
means the Internal Revenue Code of 1986, as amended, and any successor statute
thereto, as interpreted by the rules and regulations issued thereunder, in each
case as in effect from time to time. 
References to sections of the Code shall be construed also to refer to
any successor sections.


 


“Collateral
Agent” means Bank of America, N.A., in such capacity under the Intercreditor
Agreement and the Security Documents, or its successors and assigns.


 


“Commitment”
means (i) with respect to each Lender, the Revolving Commitment of such
Lender, and (ii) with respect to the Issuing Lender, the LOC Commitment.


 


“Concept” means any distinctive brand, trade name or system for
establishing and operating restaurants and/or convenience stores which is the
subject of a license or franchise from a Person.  Not in limitation of the foregoing, and by way of example only,
such systems would include “Burger King,” “Pizza Hut,” “Denny’s,” and “Fina.”


 


“Consolidated
Capital Expenditures” means, as of any date, for the four fiscal quarter
period most recently ending on or prior to such date, the sum of all capital
expenditures of the Consolidated Parties on a consolidated basis, as determined
in accordance with GAAP.


 


“Consolidated
Fixed Charges” means, as of any date, for the four fiscal quarter period
most recently ending on or prior to such date, the sum of (a) all scheduled
payments of principal on Funded Indebtedness of the Consolidated Parties on a
consolidated basis (including, without limitation, (i) the implied principal
component of payments due on Capital Leases and Synthetic Leases, (ii) all
dividends paid on the preferred Capital Stock of any Consolidated Party and
(iii) an amount, not less than zero (0), equal to  (A) payments made in connection with any ground leases, but
excluding voluntary prepayments or mandatory prepayments required pursuant to
Section 3.3 and any scheduled balloon, bullet or similar principal payment
repaying the related underlying principal Indebtedness in full), as determined
in accordance with GAAP, less (B) the rental income received by the
Consolidated Parties in connection with such ground leased properties in connection
with operating leases under which a Consolidated Party is the lessor, plus (b)
without duplication, the sum of (i) all scheduled payments of principal on
Funded Indebtedness of each Unconsolidated Affiliate multiplied by the
respective Unconsolidated Affiliate Interest of each such entity, (ii) all
dividends paid on the preferred Capital Stock of any Unconsolidated Affiliate
multiplied by the respective Unconsolidated Affiliate Interest of each such
entity; and (iii) an amount, not less than zero (0), equal to (A) (1) payments
made by any Unconsolidated Affiliate in connection with any ground leases, less
(2) the rental income received by any Unconsolidated Affiliate in connection
with such ground leased properties in connection with operating leases under
which an Unconsolidated Affiliate is the lessor, multiplied by (B) the
respective Unconsolidated Affiliate Interest of


 


5

















 


each such entity; provided, that in each
case, all of the above amounts not otherwise adjusted to account for Minority
Interests shall be adjusted to deduct therefrom the pro rata share of such
amounts allocable to the Minority Interests, plus (c) Consolidated Interest
Expense.


 


“Consolidated
Interest Expense” means, as of any date, for the four fiscal quarter period
most recently ending on or prior to such date, the sum of (i) interest expense
in connection with Funded Indebtedness (including the amortization of debt
discount and premium, the interest component under Capital Leases, the implied
interest component under Synthetic Leases and obligation payments under the any
hedging agreements or similar arrangements entered into by any Consolidated
Party) of the Consolidated Parties on a consolidated basis, as determined in
accordance with GAAP, plus (ii) without duplication, interest expense in
connection with Funded Indebtedness (including the amortization of debt
discount and premium, the interest component under Capital Leases and the
implied interest component under Synthetic Leases) of each Unconsolidated
Affiliate multiplied by the respective Unconsolidated Affiliate Interest of
each such entity; provided, that in each case, all of the above amounts not
otherwise adjusted to account for Minority Interests shall be adjusted to deduct
therefrom the pro rata share of such amounts allocable to the Minority
Interests.


 


“Consolidated
Net Income” means, as of any date, for the four fiscal quarter period most
recently ending on or prior to such date, (i) net income (excluding extraordinary
items) of the Consolidated Parties on a consolidated basis after interest
expense, income, value added and similar taxes and depreciation and
amortization, all as determined in accordance with GAAP, plus (ii) without
duplication, an amount equal to the aggregate of net income (excluding
extraordinary items) after interest expense, income, value added and similar
taxes and depreciation and amortization, as determined in accordance with GAAP,
of each Unconsolidated Affiliate multiplied by the respective Unconsolidated
Affiliate Interest of each such entity; provided, that in each case, all of the
above amounts not otherwise adjusted to account for Minority Interests shall be
adjusted to deduct therefrom the pro rata share of such amounts allocable to the
Minority Interests.


 


“Consolidated
Parties” means a collective reference to the USRP REIT, the General
Partner, the Borrower and each of their Subsidiaries, and “Consolidated
Party” means any one of them.


 


“Consolidated
Total EBITDA” means, as of any date, for the four fiscal quarter period
most recently ending on or prior to such date, the sum of (a) Consolidated
Net Income, plus (b) the sum of the
following (but only to the extent taken into account in determining
Consolidated Net Income for such period): 
(i) depreciation and amortization expense for such period; plus
(ii) interest expense for such period; plus (iii) income tax expense in
respect of such period; minus (or plus, as appropriate) (iv)
extraordinary gains (losses) and gains (losses) from sales of assets for such
period (provided, for purposes of clarification, that such gains shall
be subtracted from the overall amount calculated pursuant to this clause (ii)
and such losses shall be added to such amount); plus (or minus, as appropriate) (v) extraordinary
gains (or losses) (provided, for purposes of clarification, that such gains
shall be subtracted from the overall amount calculated pursuant to this clause
(b) and such losses shall be added to such amount), plus (or minus, as
appropriate) (vi) all straight line rent leveling adjustments (reported in the
consolidated financial statements of such Person for purposes of GAAP); plus
(or minus, as appropriate) (vii) equity in net earnings (or net loss) of
unconsolidated Affiliates of such Person (if any); plus (viii) amounts
incurred by such Person for such period as “impairment of long lived assets,” in
each case without duplication and as determined in accordance with GAAP;
provided, that, (A) each of the above calculations shall include, without duplication,
any amounts attributable to any interests held by any Consolidated Party in any
Unconsolidated Affiliate and (B) all amounts included in the above calculations
(and not otherwise adjusted to account for Minority Interests) shall be
adjusted to deduct therefrom the pro rata share of such amounts allocable to
Minority Interests.


 


“Contingent Obligation” means, with respect to any Person, any
obligation of such Person to guarantee or intended to guarantee any
Indebtedness, leases, dividends or other obligations (“primary obligations”) of
any other Person (the “primary obligor”) in any manner, whether directly or
indirectly (exclusive of any non-material contractual indemnities and
non-material guarantees of non-monetary obligations which have not yet been
called on or quantified), including, without limitation, (a) the direct or


 


6

















 


indirect
guaranty, endorsement (other than for collection or deposit in the ordinary
course of business), co-making, discounting with recourse or sale with recourse
by such Person of the obligation of a primary obligor, (b) the obligation to
make take-or-pay or similar payments, if required, regardless of nonperformance
by any other party or parties to an agreement, (c) any obligation of such
Person, whether or not contingent, (i) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (ii) to
advance or supply funds (A) for the purchase or payment of any such primary
obligation or (B) to maintain working capital, equity capital, net worth or
other balance sheet condition or any income statement condition of the primary
obligor or otherwise to maintain the solvency of the primary obligor, (iii) to
purchase, lease or otherwise acquire property, assets, securities or services
primarily for the purpose of assuring the owner of any such primary obligation
of the ability of the primary obligor to make payment of such primary
obligation or (iv) otherwise to assure or hold harmless the holder of such
primary obligation against loss in respect thereof, (d) any residual obligation
or liability of such Person under any Synthetic Lease or any other off-balance
sheet financing, or (e) any obligation of such Person in connection with any derivative
transaction, hedging transaction (including, without limitation, any Hedging
Agreements), takeout commitment or forward equity commitment.  The amount of any Contingent Obligation
shall be deemed to be an amount equal to the stated or determinable amount of
the primary obligation in respect of which such Contingent Obligation is made
(or, if less, the maximum amount of such primary obligation for which such
Person may be liable pursuant to the terms of the agreement, instrument or
other document evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder), as determined by such
Person in good faith.  Contingent
Obligations shall not include the following obligations or liabilities of the
General Partner, the Borrower or any other Subsidiaries thereof (including any
Special Purpose Entity and any Bankruptcy Remote Borrowing Entity) to the
extent incurred in connection with a Securitization Asset Sale: reasonable and
customary obligations of the General Partner, the Borrower or any other
Subsidiaries thereof with respect to (i) the servicing of any assets which are
the subject of such Securitization Asset Sale, (ii) administrative and
ministerial matters relating to any applicable Special Purpose Entity, (iii)
maintenance of the corporate separateness of any such Special Purpose Entity
from that of the General Partner and its other Subsidiaries and (iv) the
guaranty of payment of fees of any Person acting as a trustee in connection
with such Securitization Asset Sale and indemnification obligations owing to
any such Person.  In addition, the
ownership of a Subordinated Interest shall not be deemed to give rise to any
Contingent Obligation on the part of the owner thereof.  Further, Contingent Obligations shall not
include liabilities of the General Partner, Borrower or any Consolidated Party
(i) which result solely from the General Partner or such Consolidated Party
being a general partner of a Special Purpose Entity that is a limited
partnership and is not a Consolidated Party, and (ii) which liabilities are
attributable to customary and reasonable non-recourse exceptions,
representations and warranties involved with securitization transactions and
not related to the creditworthiness of the obligors involved in such
transactions (including, without limitation, exceptions for fraud,
environmental indemnities and misapplication of proceeds).


 


“Continue”,
“Continuation” and “Continued” shall refer to the continuation
pursuant to Section 3.2(a) hereof of a Eurodollar Loan from one Interest
Period to the next Interest Period.


 


“Convert”,
“Conversion” and “Converted” shall refer to a conversion pursuant
to Section 3.2(b) or Sections 3.7 through 3.12, inclusive, of a Base
Rate Loan into a Eurodollar Loan.


 


“Credit
Documents” means a collective reference to this Credit Agreement, the
Notes, each Joinder Agreement, and the
Security Documents (in each case as the same may be amended, modified,
restated, supplemented, extended, renewed or replaced from time to time), and “Credit
Document” means any one of them.


 


“Credit
Facility” shall have the meaning assigned to such term in the recitals
hereto.


 


“Credit
Parties” means a collective reference to the Borrower, the General Partner
and the other Guarantors, and “Credit Party” means any one of them.


 


7

















 


“Credit
Party Obligations” means, without duplication, (i) all of the
obligations of the Credit Parties to the Lenders (including the Issuing Lender)
and the Agent, whenever arising, under this Credit Agreement, the Notes or any
of the other Credit Documents (including, but not limited to, any interest
accruing after the occurrence of a Bankruptcy Event with respect to any Credit
Party, regardless of whether such interest is an allowed claim under the
Bankruptcy Code) and (ii) all liabilities and obligations, whenever
arising, owing from any Credit Party to any Lender, or any Affiliate of a Lender,
arising under any Hedging Agreement.


 


“Debt
Service” means, for any given calculation period and assuming an opening
principal balance equal to the amount of the principal balance outstanding
under this Credit Agreement  and the
principal amount of the Term Loan Obligations at the beginning of such period,
an amount of debt service equal to the greater of (a) the amount of principal
and interest payments that would be paid on such principal balance during such
period (assuming level monthly payments of principal and interest) at an annual
interest rate equal to the yield, as of the last day of the calculation period,
on the seven year U.S. Treasury Bond plus 2.50% and with a
twenty-five (25) year amortization schedule and (b) the amount of
principal and interest payments resulting from the application of a loan
constant equal to 9.33% to such opening principal balance (assuming level
monthly payments of principal and interest over a twenty-five (25) year
amortization schedule); provided, however, that to the extent the amount
of actual debt service payments due from the Borrower during the applicable
calculation period exceed the amount calculated in accordance with the above
provisions, “Debt Service” shall, notwithstanding the above, equal the amount
of such actual debt service payments due during the applicable period.


 


“Debt
Service Coverage Ratio” means, for any given date of calculation, the ratio
of (i) EBITDA generated in connection with the Borrowing Base Assets during the
previous twelve (12) month period for which the Borrower has delivered
officer’s certificates pursuant to the terms of Section 7.1(c) of this
Agreement to (ii) Debt Service for the same twelve (12) month period.  Notwithstanding the foregoing, to the extent
any Borrowing Base Asset(s) have been held by the Borrower for less than twelve
months as of the applicable calculation date, EBITDA with respect to such
asset(s) shall be calculated by annualizing EBITDA amounts attributable to such
asset(s) as set forth in the financial statements which the Borrower has, as of
that calculation date, delivered to the Agent, except to the extent the
Borrower has failed to deliver financial statements accounting for such
Borrowing Base Assets pursuant to and in accordance with this Agreement, in
which case the EBITDA for such Borrowing Base Assets shall, for purposes of
this definition, equal zero (0).


 


“Default”
means any event, act or condition which with notice or lapse of time, or both,
would constitute an Event of Default.


 


“Defaulting
Lender” means, at any time, any Lender that, as determined by the Agent,
(a) has failed to make a Loan or purchase a Participation Interest
required pursuant to the term of this Credit Agreement within one Business Day
of when due, (b) other than as set forth in (a) above, has failed to pay
to the Agent or any Lender an amount owed by such Lender pursuant to the terms
of this Credit Agreement within one Business Day of when due, unless such
amount is subject to a good faith dispute or (c) has been deemed insolvent
or has become subject to a bankruptcy or insolvency proceeding or with respect
to which (or with respect to any of the assets of which) a receiver, trustee or
similar official has been appointed.


 


“Delinquency
Report” means a report prepared by the Borrower setting forth in itemized
detail, as of a given date, all delinquencies with respect to Tenant payments
(whether or not such delinquencies result in the applicable asset being
characterized as an Excluded Asset for purposes hereof) and all other matters
causing any asset owned by any of the Consolidated Parties to constitute an
Excluded Asset.  Such report shall
identify the respective owners of the assets named therein and shall identify
which, if any, of the assets named therein constitute Borrowing Base Assets as
of the date of such report.


 


“Derivative Counterparty” means Bank of America, N.A.  or any of its Affiliates, as applicable, as
the counterparty to any derivative transaction, hedging transaction, takeout
commitment or forward equity commitment entered into by the USRP REIT or the
General Partner.


 


“Derivative Exposure Fee Period” shall have the meaning given to
such term in Section 3.6(d) hereof.


 


8

















 


“Derivative Exposure Usage Fee” shall have the meaning given to
such term in Section 3.6(d) hereof.


 


“Derivative Exposure Reserve” shall have the meaning given to
such term in Section 2.3(a).


 


“Determination Decision” shall have the meaning given to such
term in Section 3.22.


 


“Determination Request” shall have the meaning given to such
term in Section 3.22.


 


“Development Activities” means activities relating directly or
indirectly to the development of build-to-suit Real Property assets that are
100% pre-leased.


 


“Dollars”
and “$” means dollars in lawful currency of the United States.


 


“Domestic
Subsidiary” means any direct or indirect Subsidiary of the Borrower which
is incorporated or organized under the laws of any State of the United States
or the District of Columbia.


 


“EBITDA”
means, (a) for any Person over any period,
(i) net earnings (loss) of such Person for such period plus (ii) the sum of the
following (but only to the extent taken into account in determining net
earnings (loss) for such period): (A) depreciation and amortization expense for
such period; plus (B) interest expense for such period; plus (C)
income tax expense in respect of such period; minus (or plus, as
appropriate) (D) extraordinary gains (losses) and gains (losses) from sales of
assets for such period (provided, for purposes of clarification, that
such gains shall be subtracted from the overall amount calculated pursuant to
this clause (ii) and such losses shall be added to such amount); plus (or minus, as appropriate)
(E) extraordinary gains (or losses) (provided, for purposes of
clarification, that such gains shall be subtracted from the overall amount
calculated pursuant to this clause (ii) and such losses shall be added to such
amount), plus (or minus, as appropriate) (F) all
straight line rent leveling adjustments (reported in the consolidated financial
statements of such Person for purposes of GAAP); plus (or minus,
as appropriate) (G) equity in net earnings (or net loss) of unconsolidated
Affiliates of such Person (if any); plus (H) amounts incurred by such
Person for such period as “impairment of long lived assets,” in each
case without duplication and as determined in accordance with GAAP; and (b) for any Real Property for any
period, the net income (excluding extraordinary items) of such Real Property
for such period (which, for leased Real Properties, shall be the rental income
for such Real Properties during such period) before (without duplication)
interest expense applicable to such Real Property, income taxes applicable to
such Real Property and depreciation and amortization applicable to such Real
Property, all as determined in accordance with GAAP.


 


“Eligible
Assignee” means (a) a Lender; (b) an Affiliate of a Lender; (c) an Approved
Fund; and (d) any other Person (other than a natural person) approved by (i)
the Agent, (ii) in the case of any assignment of a Revolving Commitment, the
L/C Issuing Lender, and (iii) unless a default or Event of Default has occurred
and is continuing under this Agreement or any other Credit Document, the
Borrower (each such approval not to be unreasonably withheld or delayed); provided
that notwithstanding the foregoing, “Eligible Assignee” shall not include the
Borrower, any Credit Party or any of the Borrower’s or any Credit Party’s
Affiliates or Subsidiaries.


 


“Environmental
Laws” means any and all lawful and applicable Federal, state, local and
foreign statutes, laws (including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, the Resource
Conservation and Recovery Act of 1976, the Toxic Substances Control Act, the
Water Pollution Control Act, the Clean Air Act and the Hazardous Materials
Transportation Act), regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or other
governmental restrictions relating to the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes into the
environment including, without limitation, ambient air, surface water, ground
water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes.


 


9

















 


“Equity
Issuance” means any issuance by any Consolidated Party to any Person of
(a) shares of its Capital Stock, (b) any shares of its Capital Stock
pursuant to the exercise of options or warrants, (c) any shares of its
Capital Stock pursuant to the conversion of any debt securities to equity or
(d) any options or warrants relating to its Capital Stock (other than
employee stock options currently in place). 
The term “Equity Issuance” shall not include any Asset Disposition.


 


“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended, and any
successor statute thereto, as interpreted by the rules and regulations
thereunder, all as the same may be in effect from time to time.  References to sections of ERISA shall be
construed also to refer to any successor sections.


 


“ERISA
Affiliate” means an entity which is under common control with any
Consolidated Party within the meaning of Section 4001(a)(14) of ERISA, or
is a member of a group which includes any Consolidated Party and which is
treated as a single employer under Sections 414(b) or (c) of the Code.


 


“ERISA
Event” means (i) with respect to any Plan, the occurrence of a
Reportable Event or the substantial cessation of operations (within the meaning
of Section 4062(e) of ERISA); (ii) the withdrawal by any Consolidated
Party or any ERISA Affiliate from a Multiple Employer Plan during a plan year
in which it was a substantial employer (as such term is defined in Section 4001(a)(2)
of ERISA), or the termination of a Multiple Employer Plan; (iii) the
distribution of a notice of intent to terminate or the actual termination of a
Plan pursuant to Section 4041(a)(2) or 4041A of ERISA; (iv) the institution
of proceedings to terminate or the actual termination of a Plan by the PBGC
under Section 4042 of ERISA; (v) any event or condition which might
constitute grounds under Section 4042 of ERISA for the termination of, or
the appointment of a trustee to administer, any Plan; (vi) the complete or
partial withdrawal of any Consolidated Party or any ERISA Affiliate from a
Multiemployer Plan; (vii) the conditions for imposition of a lien under
Section 302(f) of ERISA exist with respect to any Plan; or (viii) the
adoption of an amendment to any Plan requiring the provision of security to
such Plan pursuant to Section 307 of ERISA.


 


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


 


“Eurodollar
Rate” means, for any Eurodollar Loan for any Interest Period therefor, the
rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%)
determined by the Agent to be equal to the quotient obtained by dividing
(a) the Interbank Offered Rate for such Eurodollar Loan for such Interest
Period by (b) 1 minus the Eurodollar Reserve Requirement for such
Eurodollar Loan for such Interest Period.


 


“Eurodollar
Reserve Requirement” means, at any time, the maximum rate at which reserves
(including, without limitation, any marginal, special, supplemental, or
emergency reserves) are required to be maintained under regulations issued from
time to time by the Board of Governors of the Federal Reserve System (or any
successor) by member banks of the Federal Reserve System against “Eurocurrency
liabilities” (as such term is used in Regulation D).  Without limiting the effect of the
foregoing, the Eurodollar Reserve Requirement shall reflect any other reserves
required to be maintained by such member banks with respect to (i) any
category of liabilities which includes deposits by reference to which the
Adjusted Eurodollar Rate is to be determined, or (ii) any category of
extensions of credit or other assets which include Eurodollar Loans.  The Adjusted Eurodollar Rate shall be
adjusted automatically on and as of the effective date of any change in the
Eurodollar Reserve Requirement.


 


“Event of
Default” shall have the meaning assigned to such term in Section 9.1.


 


“Excluded
Assets” means, as of any date, with respect to each of the General SPE,
S&C, JV1 and its Wholly Owned Subsidiaries and HCI and its Wholly Owned
Subsidiaries, (a) all assets of such Person which are either a lease by a
Person, as lessor of a parcel of Real Property, or a promissory note held by
such Person which is secured by a mortgage instrument, in either case where (i)
any required rental payment, principal or interest payment, or other payment
due under such lease or promissory note, as the case may be, is more than
sixty (60) days past due, except, with respect to payments due under a lease,
to the extent (A) the aggregate amount of such past due payments with respect
to such lease is less than $2500 and (B) the aggregate amount of such past due
payments does not exceed $30,000; (ii) the Tenant under such lease or the maker
of such


 


10

















 


promissory note, as the case may be, is the
subject of a Bankruptcy Event (except to
the extent that (A) such Person has been subject to a proceeding under
Chapter 11 of the Federal Bankruptcy Code, (B) the applicable bankruptcy court
has approved and confirmed such Person’s plan for reorganization, (C) all
statutory appeal periods with respect to such proposed plan have been exhausted
or expired without objection, (D) the approved plan requires such Person to
continue to perform its obligations with respect to the applicable
lease/franchise agreement and (E) such Person is performing its obligations
under such approved plan and under the applicable lease/franchise agreement); (iii) condemnation proceedings have been
instituted or condemnation has occurred with respect to a material portion of
the applicable parcel of Real Property; or (iv) the subject Real Property has
been vacant for more than sixty (60) days and such vacancy is not the
result of an on-schedule moving-in process or scheduled renovations, and (b)
all Real Property assets of the General SPE, S&C, JV1 and its Wholly
Owned Subsidiaries and HCI and its
Wholly Owned Subsidiaries which are, as of
such date, not subject to a lease agreement under which a Consolidated Party is
the lessor or are otherwise vacant (except as noted above in
subclause (a)).


 


“Executive
Officer” of any Person means any of the chief executive officer, chief
operating officer, president, vice president, chief financial officer or
treasurer of such Person.


 


“Extended
Maturity Date” shall have the meaning given to such term in Section
2.1(c)(ii) hereof.


 


“Extension
Fee” shall have the meaning given to such term in Section 2.1(c)(iii)
hereof.


 


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


 


“Fee Letter”
means that certain Fee Letter entered into by and among Borrower, BOA and BAS
and dated as of or prior to the date hereof.


 


“Fees”
means all fees payable pursuant to Section 3.5.


 


“FFO”
means, for a given period, (a) Consolidated Net Income (before Unconsolidated
Affiliate Interests and before extraordinary and non recurring items) for such
period minus (or plus) (b) gains (or losses) from debt
restructuring and sales of property during such period, plus (c)
depreciation and amortization of real and personal property assets for such
period, and after adjustments for unconsolidated partnerships and joint
ventures, plus (d) impairment charges reported by such Persons for such
period.  In determining whether an
amount distributed in a given fiscal quarter is applicable to the FFO of such
fiscal quarter or a prior fiscal quarter, the Borrower shall, in all cases,
assume that amounts distributed are distributed with respect to FFO earned in
the most recent fiscal quarter for which there exists undistributed FFO.


 


“FFO
Distribution Allowance” means, for each fiscal quarter of the Consolidated
Parties, an amount equal to 95% of FFO for such quarter, plus, to the
extent not otherwise distributed prior to commencement of the quarter for which
such calculation is being performed, 95% of FFO for the immediately preceding
three fiscal quarters.  In determining
whether an amount distributed in a given fiscal quarter is applicable to the
FFO of such fiscal quarter or a prior fiscal quarter, the Borrower shall, in
all cases, assume that amounts distributed are distributed with respect to FFO
earned in the most recent fiscal quarter for which there exists undistributed
FFO.


 


“Financial
Covenants” means a collective reference to the covenants contained in
Sections 7.11, 8.1(c) and (h), 8.2(b) and (c), 8.5(a) and (b), 8.6(d), (e),
(h), (i), (j), (k), (l) and (m) and 8.16 hereof.


 


11

















 


“Fixed
Charge Coverage Ratio” means, as of the end of any fiscal quarter of the
Consolidated Parties, for the four fiscal quarter period most recently ending
on or prior to such date with respect to the Consolidated Parties on a
consolidated basis, the ratio of (a) Consolidated Total EBITDA for such
period to (b) Consolidated Fixed Charges for such period.


 


“Foreign
Lender” shall have the meaning given to such term in Section 3.11(d)
hereof.


 


“Foreign
Subsidiary” means any direct or indirect Subsidiary of the Borrower which
is not a Domestic Subsidiary.


 


“Fully
Satisfied” means, with respect to the Credit Party Obligations as of any
date, that, as of such date, (a) all principal of and interest accrued to
such date which constitute Credit Party Obligations shall have been paid in
full in cash, (b) all fees, expenses and other amounts then due and
payable which constitute Credit Party Obligations shall have been paid in cash,
(c) all outstanding Letters of Credit shall have been (i) terminated,
(ii) fully cash collateralized or (iii) secured by one or more
letters of credit on terms and conditions, and with one or more financial
institutions, reasonably satisfactory to the Issuing Lender and (d) the
Commitments shall have been expired or terminated in full.


 


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


 


“Funded
Indebtedness” means, with respect to any Person, without duplication,
(i) all Indebtedness of such Person other than Indebtedness of the types
referred to in clauses (e), (f), (g), (i), (n) and (p) of the definition
of “Indebtedness” set forth in this Section 1.1, (ii) all Funded
Indebtedness of others of the type referred to in clause (i) above secured
by (or for which the holder of such Funded Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on, or payable out of the
proceeds of production from, Property owned or acquired by such Person, whether
or not the obligations secured thereby have been assumed (or, if less, the
aggregate net book value of all Property securing such Funded Indebtedness of
others), (iii) all Guaranty Obligations of such Person with respect to Funded
Indebtedness of the type referred to in clause (i) above of another Person
and (iv) Funded Indebtedness of the type referred to in
clause (i) above of any partnership or unincorporated joint venture
in which such Person is a general partner or a joint venturer to the extent
such Funded Indebtedness is recourse to such Person.


 


“GAAP”
means generally accepted accounting principles in the United States applied on
a consistent basis except as specifically set forth in the definitions
contained herein and subject to the terms of Section 1.3.


 


“General
Partner” shall have the meaning given to such term in the heading hereof.


 


“General
SPE” shall have the meaning given to such term in the heading hereof.


 


“Governmental
Authority” means any Federal, state, local or foreign court or governmental
agency, authority, instrumentality or regulatory body.


 


“Ground
Lease Interests” means Real Property assets with respect to which a
Consolidated Party is the ground lessee.


 


“Guarantors”
means a collective reference to the USRP REIT, the General Partner and each of
the Subsidiary Guarantors, together with each of their successors and permitted
assigns, and “Guarantor “ means any one of them.


 


“Guaranty
Obligations” means, with respect to any Person, without duplication, any
obligations of such Person (other than endorsements in the ordinary course of
business of negotiable instruments for deposit or collection) guaranteeing or
intended to guarantee any Indebtedness of any other Person in any manner,
whether direct or indirect, and including without limitation any obligation,
whether or not contingent, (i) to purchase any such Indebtedness or any
Property constituting security therefor, (ii) to advance or provide funds


 


12

















 


or other support for the payment or purchase
of any such Indebtedness or to maintain working capital, solvency or other
balance sheet condition of such other Person (including without limitation keep
well agreements, maintenance agreements, comfort letters or similar agreements
or arrangements) for the benefit of any holder of Indebtedness of such other
Person, (iii) to lease or purchase Property, securities or services
primarily for the purpose of assuring the holder of such Indebtedness, or
(iv) to otherwise assure or hold harmless the holder of such Indebtedness
against loss in respect thereof.  The
amount of any Guaranty Obligation hereunder shall (subject to any limitations
set forth therein) be deemed to be an amount equal to the outstanding principal
amount (or maximum principal amount, if larger) of the Indebtedness in respect
of which such Guaranty Obligation is made.


 


“Hawaii
Loan Documents” means that certain Loan Agreement to be entered into by and
among USRP (Bob), LLC, USRP (Hawaii), LLC and Fuel Supply, Inc. (as the
borrowers thereunder) and First Hawaiian Bank (as the lender) and each of the
“Loan Documents” as defined therein; provided, that such documents shall
substantially similar to those delivered to the Agent prior to the Closing Date
and be otherwise in form and substance acceptable to the Agent in its
discretion.


 


“HCI” has the meaning given to such term in the
Preamble of this Credit Agreement.


 


“Hedging
Agreements” means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement 
(including, without limitation, any BOA Derivative Instruments), and
(b) any and all transactions of any kind, and the related confirmations,
which are subject to the terms and conditions of, or governed by, any form of
master agreement published by the International Swaps and Derivatives Association,
Inc., any International Foreign Exchange Master Agreement, or any other master
agreement (any such master agreement, together with any related schedules, a “Master
Agreement”), including any such obligations or liabilities under any Master
Agreement, in each case (with respect to both clause (a) and (b) of this
definition, entered into between any Consolidated Party and any Lender.


 


“ICA
Joinder Agreement” shall have the meaning given to such term in the
Intercreditor Agreement.


 


“Indebtedness”
means, with respect to any Person, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, or upon
which interest payments are customarily made, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
Property purchased by such Person (other than customary reservations or
retentions of title under agreements with suppliers entered into in the
ordinary course of business), (d) all obligations of such Person issued or
assumed as the deferred purchase price of Property or services purchased by
such Person (other than trade debt incurred in the ordinary course of business
and due within six months of the incurrence thereof) which would appear as
liabilities on a balance sheet of such Person, (e) all obligations of such
Person under take-or-pay or similar arrangements or under commodities
agreements, (f) all Indebtedness of others secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on, or payable out of the proceeds of production from,
Property owned or acquired by such Person, whether or not the obligations
secured thereby have been assumed, (g) all Guaranty Obligations of such
Person with respect to Indebtedness of another Person, (h) the implied
principal component of all obligations of such Person under Capital Leases,
including all Capitalized Lease Obligations of such Person, (i) all
obligations of such Person under hedging agreements and other similar
arrangements, (j) the maximum amount of all performance and standby
letters of credit issued or bankers’ acceptances facilities created for the
account of such Person and, without duplication, all drafts drawn thereunder
(to the extent unreimbursed), (k) all preferred Capital Stock issued by
such Person and which by the terms thereof could be (at the request of the
holders thereof or otherwise) subject to mandatory sinking fund payments,
redemption or other acceleration (other than as a result of a Change of Control
or an Asset


 


13

















 


Disposition that does not in fact result in a
redemption of such preferred Capital Stock) at any time or which are otherwise
classified as liabilities or indebtedness under GAAP, (l) the principal
portion of all obligations of such Person under Synthetic Leases, (m) all
obligations of such Person to repurchase any securities issued by such Person at
any time prior to the Maturity Date which repurchase obligations are related to
the issuance thereof, including, without limitation, obligations commonly known
as residual equity appreciation potential shares, (n) the Indebtedness of
any partnership or unincorporated joint venture in which such Person is a
general partner or a joint venturer to the extent such Indebtedness is recourse
to such Person, (o) the aggregate amount of uncollected accounts
receivable of such Person subject at such time to a sale of receivables (or
similar transaction) to the extent such transaction is effected with recourse
to such Person (whether or not such transaction would be reflected on the
balance sheet of such Person in accordance with GAAP) and (p) all Contingent
Obligations of such Person.  For
purposes of clarification, the ordinary and customary rent obligations of a
Person pursuant to the terms of a real property lease which is not entered into
as a capital or financing lease shall not be included in the calculation of
“Indebtedness” hereunder.


 


“Indemnified
Party” shall have the meaning assigned to such term in
Section 11.5(b).


 


“Initial
Maturity Date” shall have the meaning given to such term in Section
2.1(c)(i) hereof.


 


“Interbank
Offered Rate” means, for any Eurodollar
Loan for any Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Telerate Page 3750 (or
any successor page) as the London interbank offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two Business Days prior to
the first day of such Interest Period. If for any reason such rate is not
available, the term “LIBOR” shall mean, for any Eurodollar Loan for any
Interest Period therefor, the rate per annum (‘rounded upwards, if necessary,
to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as the London
interbank offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period; provided, however,
if more than one rate is specified on Reuters Screen LIBO Page, the applicable
rate shall be the arithmetic mean of all such rates.


 


“Intercreditor Agreement” means that certain Intercreditor
Agreement dated as of  the date hereof
and entered into by and among the Collateral Agent, the Agent and the “Agent”
under the Term Loan Agreement with respect to the priority of payments made by
Borrower hereunder and under the Term Loan Agreement and the allocation of
proceeds derived from the collateral under the Security Documents, as the same
may be amended, restated, supplemented or otherwise modified from time to time
in accordance with its terms.


 


“Interest
Payment Date” means (a) as to Base Rate Loans, (i) the 20th
day of each calendar month, (ii) the date of repayment of principal of such
Loan and (iii) the Maturity Date, and (b) as to Eurodollar Loans, (i) the
last day of each applicable Interest Period, (ii) the date of repayment of
principal of such Loan, (iii) the Maturity Date, and (iv) where the applicable
Interest Period for a Eurodollar Loan is greater than one month, the dates
occurring each calendar month following the first day of the Interest Period.


 


“Interest
Period” means, as to Eurodollar Loans, a period of one, two, three, six or
twelve months duration (to the extent available from each of the Lenders), as
the Borrower may elect, commencing, in each case, on the date of the borrowing
(including continuations and conversions thereof); provided, however,
(a) if any Interest Period would end on a day which is not a Business Day,
such Interest Period shall be extended to the next succeeding Business Day
(except that where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next preceding Business Day),
(b) no Interest Period shall extend beyond the Maturity Date and
(c) where an Interest Period begins on a day for which there is no
numerically corresponding day in the calendar month in which the Interest
Period is to end, such Interest Period shall end on the last Business Day of
such calendar month.


 


“Investment”
in any Person means (a) the acquisition (whether for cash, property,
services, assumption of Indebtedness, securities or otherwise) of assets (other
than equipment, inventory and supplies in the ordinary course of business and
other than any acquisition of assets constituting a Consolidated Capital
Expenditure), Capital Stock, bonds, notes, debentures, partnership, joint
ventures or other ownership interests or


 


14

















 


other securities of such other Person,
(b) any deposit with, or advance, loan or other extension of credit to,
such Person (other than deposits made in connection with the purchase of
equipment inventory and supplies in the ordinary course of business) or
(c) any other capital contribution to or investment in such Person,
including, without limitation, any Guaranty Obligations (including any support
for a letter of credit issued on behalf of such Person) incurred for the
benefit of such Person and any Asset Disposition to such Person for
consideration less than the fair market value of the Property disposed in such
transaction, but excluding any Restricted Payment to such Person.  Investments which are capital contributions
or purchases of Capital Stock which have a right to participate in the profits
of the issuer thereof shall be valued at the amount actually contributed or
paid to purchase such Capital Stock as of the date of such contribution or
payment.  Investments which are loans,
advances, extensions of credit or Guaranty Obligations shall be valued at the
principal amount of such loan, advance or extension of credit outstanding as of
the date of determination or, as applicable, the principal amount of the loan
or advance outstanding as of the date of determination actually guaranteed by
such Guaranty Obligation.


 


“I/O Strip” means an interest in a pool of promissory notes,
mortgage loans, or other similar financial assets, issued in connection with a
Securitization Asset Sale or otherwise, which entitles the holder to receive a
portion of the interest paid on, but not principal repaid in respect of, such
financial assets.


 


“Issuing
Lender” shall have the meaning assigned to such term in the heading hereof,
together with any successors or assigns.


 


“Issuing
Lender Fees” shall have the meaning given to such term in
Section 3.5(c) hereof.


 


“Joinder
Agreement” means a Joinder Agreement substantially in the form of Exhibit 7.12
hereto, executed and delivered by a new Guarantor in accordance with the
provisions of Section 7.12.


 


“JV1”
shall have the meaning given to such term in the introductory paragraph hereof.


 


“JV1 Pledge
Agreement” means that certain Pledge
and Security Agreement entered into by JV1 as of the date hereof in favor of
the Collateral Agent and for the benefit of the Lender Parties.


 


“Lender”
means any of the Persons identified as a “Lender” on the signature pages
hereto, and any Person which may become a Lender by way of assignment in
accordance with the terms hereof, together with their successors and permitted
assigns.


 


“Lender
Party” shall mean any of the Agent, Collateral Agent or any Lender from
time to time a party hereto; and “Lender Parties” means a collective reference
to each.


 


“Letter of
Credit” means any letter of credit issued by the Issuing Lender for the
account of the Borrower in accordance with the terms of Section 2.2.


 


“Letter of
Credit Fee” shall have the meaning assigned to such term in
Section 3.5.


 


“Leverage
Ratio” means, as of the end of any fiscal quarter of the Consolidated
Parties, the ratio of (a) Total Liabilities to (b) Total Tangible
Assets.


 


“Lien”
means any mortgage, pledge, hypothecation, assignment, deposit arrangement,
security interest, encumbrance, lien (statutory or otherwise), preference,
priority or charge of any kind (including any agreement to give any of the
foregoing, any conditional sale or other title retention agreement, any
financing or similar statement or notice filed under the Uniform Commercial
Code as adopted and in effect in the relevant jurisdiction or other similar
recording or notice statute, and any lease in the nature thereof); provided,
that the term “Lien” shall not refer to or include Negative Pledges.


 


15

















 


“Loan”
or “Loans” means the Revolving Loans (or a portion of any Revolving Loan
bearing interest at the Adjusted Base Rate or the Adjusted Eurodollar Rate and
referred to as a Base Rate Loan or a Eurodollar Loan), individually or
collectively, as appropriate.


 


“LOC
Commitment” means the commitment of the Issuing Lender to issue Letters of
Credit in an aggregate face amount at any time outstanding (together with the
amounts of any unreimbursed drawings thereon) of up to the LOC Committed
Amount.


 


“LOC
Committed Amount” shall have the meaning assigned to such term in
Section 2.2.


 


“LOC
Documents” means, with respect to any Letter of Credit, such Letter of
Credit, any amendments thereto, any documents delivered in connection therewith,
any application therefor, and any agreements, instruments, guarantees or other
documents (whether general in application or applicable only to such Letter of
Credit) governing or providing for (i) the rights and obligations of the
parties concerned or at risk or (ii) any collateral security for such
obligations.


 


“LOC
Obligations” means, at any time, the sum of (i) the maximum amount
which is, or at any time thereafter may become, available to be drawn under
Letters of Credit then outstanding, assuming compliance with all requirements
for drawings referred to in such Letters of Credit plus (ii) the
aggregate amount of all drawings under Letters of Credit honored by the Issuing
Lender but not theretofore reimbursed by the Borrower.


 


“Material
Adverse Effect” means a material adverse effect on (i) the condition
(financial or otherwise), operations, business, assets, liabilities or
prospects of the Consolidated Parties taken as a whole, (ii) the ability
of any Credit Party to perform any material obligation under the Credit
Documents to which it is a party or (iii) the material rights and remedies
of the Agent and the Lenders under the Credit Documents; provided, that, for
purposes of Section 6.16 hereof only, “Material Adverse Effect” means any
one of (i) through (iii) above or (iv) a material adverse effect on the
value of, conditions on, operations on, business conducted on or prospects of
any parcel of Real Property or the rights and remedies of the Agent and the
Lenders with respect thereto.


 


“Materials
of Environmental Concern” means any gasoline or petroleum (including crude
oil or any fraction thereof) or petroleum products or any hazardous or toxic
substances, materials or wastes, defined or regulated as such in or under any
Environmental Laws, including, without limitation, asbestos, polychlorinated
biphenyls and urea-formaldehyde insulation.


 


“Maturity
Date” shall have the meaning given to such term in Section 2.1(c)(iv)
hereof.


 


“Minority
Interests” means, at any time, interests in any assets or entities (and, as
applicable, the cost thereof, Cash and Cash Equivalents held in connection
therewith, the income, revenues, interest expense, taxes, depreciation and
amortization attributable thereto) owned by entities that are not Consolidated
Parties.


 


“Moody’s”
means Moody’s Investors Service, Inc., or any successor or assignee of the
business of such company in the business of rating securities.


 


“Multiemployer
Plan” means a Plan which is a “multiemployer plan” as defined in
Sections 3(37) or 4001(a)(3) of ERISA.


 


“Multiple
Employer Plan” means a Plan (other than a Multiemployer Plan) which any
Consolidated Party or any ERISA Affiliate and at least one employer other than
the Consolidated Parties or any ERISA Affiliate are contributing sponsors.


 


“Negative Pledge” means a provision of any agreement (other than
this Credit Agreement or any other Credit Document) that prohibits the creation
of any Lien on any assets of a Person, whether presently owned or hereafter
acquired; provided, however, that an agreement that establishes a
maximum ratio of


 


16

















 


unsecured debt
to unencumbered assets, or of secured debt to total assets, or that otherwise
conditions a Person’s ability to encumber its assets upon the maintenance of
one or more specified ratios that limit such Person’s ability to encumber its
assets but that do not generally prohibit the encumbrance of its assets, or the
encumbrance of specific assets, shall not constitute a “Negative Pledge” for
purposes of this Credit Agreement.


 


“Net Cash
Proceeds” means the aggregate proceeds paid in cash or Cash Equivalents
received by any Consolidated Party in respect of any Asset Disposition or
Equity Issuance (as applicable), net of (a) direct costs (including,
without limitation, legal, accounting and investment banking fees, and sales
commissions) (b) taxes paid or payable as a result thereof and (c) in
the case of any Asset Disposition, the amount necessary to retire any
Indebtedness secured by a Permitted Lien (ranking senior to any Lien of the
Agent) on the related Property; it being understood that “Net Cash Proceeds”
shall include, without limitation, any cash or Cash Equivalents received upon
the sale or other disposition of any non-cash consideration received by any
such Consolidated Party in any such Asset Disposition or Equity Issuance.


 


“Note”
or “Notes” means the Revolving Notes, individually or collectively, as
appropriate.


 


“Notice of
Borrowing” means a written notice of borrowing in substantially the form of
Exhibit 2.1(b)(i), as required by Section 2.1(b)(i),
Section 2.3(b) or Section 2.4(b).


 


“Notice of Continuation” means a notice in the form of Exhibit 3.2
to be delivered to the Agent pursuant to Section 3.2(a) evidencing the
Borrower’s request for the Continuation of a Eurodollar Loan.


 


“Notice of Conversion” means a notice in the form of Exhibit 3.2
to be delivered to the Agent pursuant to Section 3.2(b) evidencing the
Borrower’s request for the Conversion of a Loan from one Type to another Type.


 


“Operating
Lease” means, as applied to any Person, any lease (including, without
limitation, leases which may be terminated by the lessee at any time) of any
Property (whether real, personal or mixed) which is not a Capital Lease other
than any such lease in which that Person is the lessor.


 


“Other
Taxes” shall have the meaning assigned to such term in
Section 3.11(b).


 


“Participant”
has the meaning assigned to such term in clause (d) of Section 11.3.


 


“Participation
Interest” means a purchase by a Lender of a participation in Letters of
Credit or LOC Obligations as provided in Section 2.2 or in any Loans as
provided in Section 3.14.


 


“PBGC”
means the Pension Benefit Guaranty Corporation established pursuant to Subtitle
A of Title IV of ERISA and any successor thereof.


 


“Permitted
Investments” means, at any time, Investments by the Consolidated Parties
permitted to exist at such time pursuant to the terms of Section 8.6.


 


“Permitted
Liens” means, at any time, Liens in respect of Property of the Consolidated
Parties permitted to exist at such time pursuant to the terms of
Section 8.2.


 


“Person”
means any individual, partnership, joint venture, firm, corporation, limited
liability company, association, trust or other enterprise (whether or not
incorporated) or any Governmental Authority.


 


“Plan”
means any employee benefit plan (as defined in Section 3(3) of ERISA)
which is covered by ERISA and with respect to which any Consolidated Party or
any ERISA Affiliate is (or, if such plan were terminated at such time, would under
Section 4069 of ERISA be deemed to be) an “employer” within the meaning of
Section 3(5) of ERISA.


 


17

















 


“Preferred Stock”  means, with respect to any Person, shares
of Capital Stock in such Person which are entitled to preference or priority
over any other Capital Stock in such Person in respect of the payment of
dividends or distribution of assets upon liquidation or both.


 


“Prime Rate”
means the per annum rate of interest established from time to time by BOA as
its prime rate, which rate may not be the lowest rate of interest charged by
BOA to its customers.


 


“Principal
Borrower” shall have the meaning given to such term in the introductory
paragraph hereof.


 


“Pro Forma
Basis” means, for purposes of calculating (utilizing the principles set
forth in the second paragraph of Section 1.3) compliance with each of the
Financial Covenants in respect of a proposed transaction, that such transaction
shall be deemed to have occurred as of the first day of the applicable period
for which a given calculation is being performed.  As used herein, “transaction” shall mean (i) any
incurrence or assumption of Indebtedness as referred to in
Section 8.1(h)(i), or (ii) any Asset Disposition as referred to in
Section 8.5(a).  In connection with
any calculation of the Financial Covenants, upon giving effect to a transaction
on a Pro Forma Basis:


 


(A)                              for purposes of any such
calculation in respect of any incurrence or assumption of Indebtedness as
referred to in Section 8.1(h)(i), any Indebtedness which is retired in
connection with such incurrence or assumption shall be excluded and deemed to
have been retired as of the first day of the applicable period; and


 


(B)                                for purposes of any
such calculation in respect of any Asset Disposition as referred to in
Section 8.5(a), (1) income statement items (whether positive or
negative) and capital expenditures attributable to the Property disposed of
shall be excluded and (2) any Indebtedness which is retired in connection
with such transaction shall be excluded and deemed to have been retired as of
the first day of the applicable period.


 


“Pro Forma
Compliance Certificate” means a certificate of an Executive Officer of the
Borrower delivered to the Agent in connection with (i) any incurrence,
assumption or retirement of Indebtedness as referred to in
Section 8.1(h)(i), or (ii) any Asset Disposition as referred to in
Section 8.5(a), as applicable, and containing reasonably detailed
calculations, upon giving effect to the applicable transaction on a Pro Forma
Basis, of those items required for determining compliance with
Section 7.11 as of the most recent fiscal quarter end preceding the date
of the applicable transaction with respect to which the Agent shall have
received the Required Financial Information.


 


“Property”
means any interest in any kind of property or asset, whether real, personal or
mixed, or tangible or intangible.


 


“Qualified REIT Subsidiary” shall have the meaning given to such
term in the Code.


 


“Real
Properties” means, at any time, a collective reference to each of the
facilities and real properties owned, leased or operated by the Consolidated
Parties or in which any Consolidated Party has an interest at such time; and “Real
Property” means any one of such Real Properties.


 


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


 


“Register”
shall have the meaning assigned to such term in Section 11.3(c).


 


“Regulation D,
T, U, or X” means Regulation D, T, U or X, respectively, of the Board
of Governors of the Federal Reserve System as from time to time in effect and
any successor to all or a portion thereof.


 


“REIT” means a Person qualifying for treatment as a “real estate
investment trust” under the Code.


 


18

















 


“Replaced Credit Agreement” means that certain Credit Agreement
dated as of May 31, 2002 among the Borrower, the Guarantors, the Agent, the
lenders identified therein and BAS, as the same has been amended, restated,
supplemented or otherwise modified prior to the date hereof.


 


“Reportable
Event” means any of the events set forth in Section 4043(c) of ERISA,
other than those events as to which the notice requirement has been waived by
regulation.


 


“Required
Financial Information” means, with respect to any given date, (i) the
financial statements of the Consolidated Parties required to be delivered
pursuant to Section 7.1(a) or (b) for the fiscal period or quarter ending
most recently with respect to such date, and (ii) the certificate of an
Executive Officer of the Borrower required by Section 7.1(c) to be
delivered with the financial statements described in clause (i) above.


 


“Required
Lenders” means, at any time, (a) the Agent, (b) the “Agent” under the Term
Loan Agreement and (c) Lenders (other than Defaulting Lenders) and Term Loan
Lenders holding in the aggregate at least 66 2/3% of the Revolver/Term
Outstanding Amount (excluding amounts held by Defaulting Lenders).


 


“Required
Revolver Lenders” means, at any time, (a) the Agent and (b) Lenders (other
than Defaulting Lenders) holding in the aggregate at least 66 2/3% of
(i) the Revolving Commitments (and Participation Interests therein), or
(ii) if the Revolving Commitments have been terminated, the outstanding
Loans, LOC Obligations and Participation Interests (including the Participation
Interests of the Issuing Lender in any Letters of Credit).


 


“Requirement
of Law” means, as to any Person, the certificate of incorporation and
by-laws or other organizational or governing documents of such Person, and any
law, treaty, rule or regulation or determination of an arbitrator or a court or
other Governmental Authority, in each case applicable to or binding upon such
Person or to which any of its material property is subject.


 


“Reserve
Limit” shall have the meaning given to such term in Section 2.3(a).


 


“Restricted
Payment” means (i) any dividend or other payment or distribution,
direct or indirect, on account of any shares of any class of Capital Stock of
any Consolidated Party, now or hereafter outstanding (including without
limitation any payment in connection with any dissolution, merger,
consolidation or disposition involving any Consolidated Party), or to the
holders, in their capacity as such, of any shares of any class of Capital Stock
of any Consolidated Party, now or hereafter outstanding (other than dividends
or distributions payable in Capital Stock of the applicable Person and
dividends or distributions payable (directly or indirectly through
Subsidiaries) to any Credit Party other than the General Partner),
(ii) any redemption, retirement, sinking fund or similar payment, purchase
or other acquisition for value, direct or indirect, of any shares of any class
of Capital Stock of any Consolidated Party, now or hereafter outstanding,
(iii) any payment made to retire, or to obtain the surrender of, any
outstanding warrants, options or other rights to acquire shares of any class of
Capital Stock of any Consolidated Party, now or hereafter outstanding, and
(iv) any loan or advance to the General Partner.


 


“Revolver/Term
Outstanding Amount” means an amount equal to the sum of (a) (i) the
Revolving Commitments (and Participation Interests therein), or (ii) if
the Revolving Commitments have been terminated, the outstanding Loans, LOC
Obligations and Participation Interests (including the Participation Interests
of the Issuing Lender in any Letters of Credit), in each case, if any, plus
(b) the “Outstanding Amount” as such term is defined in the Term Loan
Agreement, if any.


 


“Revolving
Commitment” means, with respect to each Lender, the commitment of such
Lender in an aggregate principal amount as set forth on Schedule 1.1(a)
attached hereto, as such schedule may be modified in connection with any
assignment made in accordance with Section 11.3, as a result of the
application of Section 3.20 hereof or as a result of the application of
Section 3.4 hereof.


 


“Revolving
Commitment Percentage” means, for any Lender, the percentage represented by
such Lender’s Revolving Commitment as a portion of the total Revolving
Committed Amount, as such percentage


 


19

















 


may be modified in connection with any assignment
made in accordance with the provisions of Section 11.3 or otherwise in
connection with the terms and conditions set forth herein.


 


“Revolving
Committed Amount” means $50,000,000.00, as such amount may be adjusted
pursuant to and in accordance with the terms of this Credit Agreement
(including, without limitation, pursuant to Sections 3.4 hereof).


 


“Revolving
Loans” shall have the meaning assigned to such term in Section 2.1(a).


 


“Revolving
Note” or “Revolving Notes” means the promissory notes of the
Borrower in favor of each Lender provided pursuant to Section 2.1(e) and
evidencing the Revolving Loans of such Lender, individually or collectively, as
appropriate, as such promissory notes may be amended, modified, restated,
supplemented, extended, renewed or replaced from time to time.


 


“S&C”
has the meaning given to such term in the
Preamble of this Credit Agreement.


 


“S&P”
means Standard & Poor’s Ratings Group, a division of The McGraw Hill
Companies, Inc., or any successor or assignee of the business of such division
in the business of rating securities.


 


“Sale and
Leaseback Transaction” means any arrangement pursuant to which any Person,
directly or indirectly, becomes liable as lessee, guarantor or other surety
with respect to any lease, whether an Operating Lease or a Capital Lease, of
any Property (a) which such Person has sold or transferred (or is to sell
or transfer) to a Person which is not a consolidated affiliate of such Person
or (b) which such Person intends to use for substantially the same purpose
as any other Property which has been sold or transferred (or is to be sold or
transferred) by such Person to another Person which is not a consolidated
affiliate of such Person in connection with such lease.


 


“Secured Indebtedness” means, with respect to any Person, any
Indebtedness (other than Indebtedness incurred hereunder or under the Term Loan
Documents) that is secured in any manner by any Lien.  Indebtedness in respect of Capitalized Lease Obligations shall
not be deemed to be Secured Indebtedness. 
For clarification purposes,


 


(i) any
unsecured guaranty given by any Credit Party of secured indebtedness of a
Person who is not a Credit Party constitutes Unsecured Indebtedness of such
Credit Party giving the guaranty,


 


(ii) any
unsecured guaranty given by any Credit Party of the secured indebtedness of
another Credit Party constitutes the Secured Indebtedness of the Credit Party
directly incurring the secured indebtedness and shall not be calculated as part
of the Indebtedness (either Secured or Unsecured) of such Credit Party giving
the guaranty (except to the extent that the relevant calculation does not
otherwise account for the Indebtedness of the Credit Party directly incurring
the underlying secured indebtedness, in which case it shall constitute the
Unsecured Indebtedness of the Credit Party giving the guaranty),


 


(iii) any
unsecured guaranty given by any Credit Party of the unsecured indebtedness of a
Person who is not a Credit Party constitutes the Unsecured Indebtedness of such
Credit Party giving the guaranty,


 


(iv) any
unsecured guaranty given by any Credit Party of the unsecured Indebtedness of
another Credit Party constitutes the Unsecured Indebtedness of the Credit Party
directly incurring such Indebtedness and shall not be calculated as part of the
Indebtedness (either Secured or Unsecured) of such Credit Party giving the
guaranty (except to the extent that the relevant calculation does not otherwise
account for the Indebtedness of the Credit Party directly incurring the
underlying unsecured indebtedness, in which case it shall constitute the
Unsecured Indebtedness of the Credit Party giving the guaranty),


 


20

















 


(v) any secured
guaranty given by any Credit Party of secured indebtedness of a Person who is
not a Credit Party constitutes Secured Indebtedness of such Credit Party giving
the guaranty,


 


(vi) any secured
guaranty given by any Credit Party of the secured indebtedness of another
Credit Party constitutes the Secured Indebtedness of the Credit Party directly
incurring the secured indebtedness and shall not be calculated as part of the
Indebtedness (either Secured or Unsecured) of such Credit Party giving the
guaranty (except to the extent that the relevant calculation does not otherwise
account for the Indebtedness of the Credit Party directly incurring the
underlying secured indebtedness, in which case it shall constitute the Secured
Indebtedness of the Credit Party giving the guaranty),


 


(vii) any
secured guaranty given by any Credit Party of the unsecured indebtedness of a
Person who is not a Credit Party constitutes the Secured Indebtedness of such
Credit Party giving the guaranty, and


 


(viii) any
secured guaranty given by any Credit Party of the unsecured Indebtedness of
another Credit Party constitutes the Secured Indebtedness of such Credit Party
giving the guaranty and shall not be calculated as part of the Indebtedness
(either Secured or Unsecured) of the Credit Party directly incurring such
Indebtedness (except to the extent that the relevant calculation does not
otherwise account for the Indebtedness of such Credit Party giving the
guaranty, in which case it shall constitute the Unsecured Indebtedness of the
Credit Party directly incurring the underlying unsecured indebtedness).


 


“Secured Parties” shall have the meaning given to such term in
the Intercreditor Agreement.


 


“Securities
Act” means the Securities Act of 1933, as amended, and all regulations
issued pursuant thereto.


 


“Securitization Asset Sale” means a transaction consisting of
one or more limited recourse or nonrecourse transfers by the Borrower, the
General Partner or any of their Subsidiaries, to a Special Purpose Entity, of
promissory notes, mortgage loans, net leased real property interests,
investment securities representing an interest in or secured by debt or equity
tranches of investment securities, chattel paper, leases or other similar
financial assets originated by the General Partner, the Borrower or any other
Subsidiary thereof, together with any related title or other insurance
policies, hedge agreements and other assets directly related to such financial
assets, which transfers may properly be, and is, accounted for on the
consolidated balance sheet of the General Partner as a sale in conformity with Financial
Accounting Standards Board Statement of Financial Accounting Standard No. 125
followed by either (x) limited recourse or nonrecourse sales of such financial
assets (or interests therein) by such Special Purpose Entity to one or more
Persons the accounts of which would not be required to be consolidated with
those of the General Partner in their consolidated financial statements in
accordance with GAAP (provided that subordinated interests in such financial
assets and I/O Strips may be issued or sold to any Person) or (y) the
incurrence by such Special Purpose Entity of Indebtedness secured by a Lien
encumbering only the assets of such Special Purpose Entity; provided that all
of the Indebtedness, liabilities and other obligations of such Special Purpose
Entity incurred in connection with such transactions are nonrecourse for the
payment or performance thereof to the General Partner, the Borrower or any
other Subsidiary (excluding such Special Purpose Entity) other than the
following: (a) reasonable and customary obligations of the General Partner, the
Borrower or any other Subsidiary with respect to (i) the servicing of any
assets which are the subject of such transaction, (ii) administrative and
ministerial matters relating to such Special Purpose Entity, (iii) maintenance
of the corporate separateness of such Special Purpose Entity from that of the
General Partner and its other Subsidiaries, and (iv) the guaranty of payment of
fees of any Person acting as a trustee in connection with such transaction and
indemnification obligations owing to any such Person; (b) reasonable and
customary repurchase obligations and other liabilities resulting from the
breach of representations, warranties and covenants that are not related to
creditworthiness of the obligors on the financial assets the subject of such
transactions and (c) limited recourse provisions giving rise to Indebtedness
solely to the extent permitted under Section 8.1.  For purposes of this definition, whether an


 


21

















 


obligation or
liability is “reasonable and customary” shall be determined with reference to
terms of similar transactions prevailing as of the date hereof.


 


“Securities
Exchange Act” means the Securities Exchange Act of 1934, as amended, and
all regulations issued pursuant thereto.


 


“Security
Documents” means a collective reference to , the USRP Pledge Agreement, the
USRP Holding Pledge Agreement, the JV1 Pledge Agreement, any UCC financing statements securing payment
under any of such documents, and any other documents securing the obligations
of the Credit Parties under this Credit Agreement or any other Credit Document
(in each case as the same may be amended, modified, restated, supplemented,
extended, renewed or replaced from time to time).


 


“Single
Employer Plan” means any Plan which is covered by Title IV of ERISA,
but which is not a Multiemployer Plan or a Multiple Employer Plan.


 


“Solvent”
or “Solvency” means, with respect to any Person as of a particular date,
that on such date (i) such Person is able to pay its debts and other
liabilities, contingent obligations and other commitments as they mature in the
normal course of business, (ii) such Person does not intend to, and does
not believe that it will, incur debts or liabilities beyond such Person’s
ability to pay as such debts and liabilities mature in their ordinary course,
(iii) such Person is not engaged in a business or a transaction, and is
not about to engage in a business or a transaction, for which such Person’s
Property would constitute unreasonably small capital after giving due
consideration to the prevailing practice in the industry in which such Person
is engaged or is to engage, (iv) the fair value of the Property of such
Person is greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person and (v) the present
fair salable value of the assets of such Person is not less than the amount
that will be required to pay the probable liability of such Person on its debts
as they become absolute and matured.  In
computing the amount of contingent liabilities at any time, it is intended that
such liabilities will be computed at the amount which, in light of all the
facts and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.


 


“Special Purpose Entity” means any Person (a) which has a legal
structure and capitalization intended to make such entity a “bankruptcy remote”
entity and which legal structure and capitalization have been approved in
writing by the Agent; (b) which has been organized for the sole purpose of
effecting a structured financing; (c) which has no assets other than (i) the
financial assets directly acquired in connection with, and which are the
subject of, such structured financing, and any related title or other insurance
policies, hedge agreements and other assets directly related to such financial
assets, (ii) cash and other assets contributed or distributed to such Person,
or otherwise acquired by it, in connection with such structured financing, and
which assets are retained by such Person either pursuant to the requirements of
such structured financing or to permit it to fulfill its obligations under the
terms of such structured financing, (iii) assets which such Person is to (and
does in fact) dispose of promptly, and in any event within two Business Days,
following such Person’s acquisition of such assets, and (iv) in the case of a
Securitization Asset Sale, subordinated interests acquired in connection with
such Securitization Asset Sale; (d) which has no Indebtedness, liabilities or
other obligations other than (i) those directly incurred in connection with
such structured financing, (ii) any liabilities resulting from representations
and warranties made by such Person with respect to any such financial assets or
other assets being transferred by it to another Person so long as such
representations and warranties (A) are customary or (B) are substantially
similar to those made to such Person when such assets were initially
transferred to it and (iii) trade payables incurred in the ordinary course of
trade or business in an aggregate amount not to exceed $100,000; and (e) which
none of the General Partner, the Borrower or any other Subsidiaries thereof
have any direct obligation to maintain or preserve such Person’s financial
condition or to cause such Person to achieve any specified levels of operating
results except as otherwise permitted in connection with such structured financing.


 


“Subordinated Interest” means a subordinate interest (whether
characterized as debt or equity, and including without limitation, general and
limited partnership interests, participation certificates and trust


 


22

















 


certificates) in
a pool of promissory notes, mortgage loans, chattel paper, leases or other
similar financial assets, issued in connection with a Securitization Asset Sale
or otherwise.


 


“Subsidiary”
means, as to any Person at any time, (a) any corporation more than 50% of
whose Capital Stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at such time, any class or classes of such
corporation shall have or might have voting power by reason of the happening of
any contingency) is at such time owned by such Person directly or indirectly
through Subsidiaries, and (b) any partnership, association, joint venture
or other entity of which such Person directly or indirectly through
Subsidiaries owns at such time more than 50% of the Capital Stock.


 


“Subsidiary
Guarantor” means each of the Persons identified as a “Subsidiary Guarantor”
on the signature pages hereto and each Person which may hereafter execute a
Joinder Agreement pursuant to Section 7.12, together with their successors
and permitted assigns, and “Subsidiary Guarantor” means any one of them.


 


“Successful
Syndication” means a syndication of the Credit Facility by BAS which results
in (a) BOA having a Revolving Commitment hereunder equal to or less than
$30,000,000; and (b) total Revolving Commitments equal to or in excess of
$50,000,000.


 


“Syndication
Letter” means that certain mandate letter dated as of September 23, 2003 by
and among Borrower, Guarantor, Agent and BAS.


 


“Synthetic
Lease” means any synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing product where
such transaction is considered borrowed money indebtedness for tax purposes but
is classified as an Operating Lease under GAAP.


 


“Tangible
Net Worth” means, as of any given calculation date, (a) Total Tangible
Assets, less (b) the sum of (i) Total Liabilities less (ii) the
aggregate of the amounts added to Total Liabilities pursuant to clauses (b) and
(d) of the definition thereof and in connection with proviso items (i) and
(ii)(A) and (C) contained in such definition.


 


“Taxes”
shall have the meaning assigned to such term in Section 3.11(a).


 


“Tenant”
means any Person (or their respective Affiliates) who is a lessee with respect
to any lease held by the Borrower as lessor or as an assignee of the lessor
thereunder.


 


“Term Loan
Agreement” means that certain $35 million Term Loan Credit Agreement dated
as of the date hereof among the Borrower, Guarantors, BOA, as administrative
agent and BAS and such other lenders as may be party thereto from time to time,
as the same may be amended, restated, supplemented or otherwise modified from
time to time following the date hereof.


 


“Term Loan
Lenders” means the “Lenders” as such term is defined in the Term Loan
Agreement; provided, that, for purposes of this Agreement, such term shall not
include “Defaulting Lenders” under the Term Loan Agreement.


 


“Term Loan
Documents” means the “Credit Documents” as such term is defined in the Term
Loan Agreement.


 


“Term Loan
Obligations” means, at any time, an amount equal to the amount of the
“Credit Party Obligations,” as defined in the Term Loan Agreement.


 


“Term Securitization” means a Securitization Asset Sale (a)
involving only a single transfer (or series of related and substantially
contemporaneous transfers) to a Special Purpose Entity of financial assets, and
any related title or other insurance policies, hedge agreements and other assets
directly related to such financial assets, by the General Partner, the Borrower
or any other Subsidiary thereof other than any


 


23

















 


transfer of such
assets (i) being substituted for any asset previously transferred pursuant to
customary and reasonable repurchase and substitution obligations resulting from
the breach of representations, warranties and covenants that are not related to
the creditworthiness of the obligor on the financial assets or (ii) being
substituted for cash collateral or a cash deposit (including in connection with
reasonable and customary “pre-funding” arrangements), and (b) under which the
Persons acquiring such financial assets (or interests therein) from the
applicable Special Purpose Entity or making advances to such Special Purpose
Entity secured directly or indirectly by such financial assets, are neither
required nor permitted to acquire additional financial assets (or interests
therein) from, or otherwise make additional advances to, such Special Purpose
Entity, except as otherwise permitted under the immediately preceding
clause (a).


 


“Total Liabilities” means the sum of (a) total
liabilities of the Consolidated Parties on a consolidated basis, as determined
in accordance with GAAP, plus (b) an amount equal to the aggregate total
liabilities, as determined in accordance with GAAP, of each Unconsolidated
Affiliate multiplied by the respective Unconsolidated Affiliate Interest of
each such entity plus (c) without duplication, the Indebtedness of the
Consolidated Parties on a consolidated basis plus (d) without
duplication, the aggregate of Indebtedness (including, without limitation, all
Contingent Obligations) of each Unconsolidated Affiliate multiplied by the
respective Unconsolidated Affiliate Interest of each such entity; provided,
that (i) in each case, all of the above amounts not otherwise adjusted to
account for Minority Interests shall be adjusted to deduct therefrom the pro
rata share of such amounts allocable to the Minority Interests (except to the
extent any Credit Party would be legally liable for the full amount of such
liabilities) and (ii) notwithstanding anything contained herein to the
contrary, “Total Liabilities” shall include, without duplication (A) all obligations of any Consolidated Party to
purchase, redeem, retire, defease or otherwise make any payment in respect of
any Preferred Stock of any entity in which it owns any Capital Stock, valued,
in the case of redeemable Preferred Stock, at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends;
(B) the maximum amount that could be owed by any Consolidated Party with
respect to all of such Consolidated Party’s other Preferred Stock and (C) the
amount equal to (1) the maximum amount that could be owed by any Unconsolidated
Affiliate with respect to such Unconsolidated Affiliate’s Preferred Stock,
multiplied by (2) the respective Unconsolidated Affiliate Interest of each such
entity.


 


“Total Rent”
means, with respect to rental income used in calculating Borrowing Base Asset
Value, gross rental income from all Borrowing Base Assets over the applicable
period.


 


“Total
Tangible Assets” means the sum of (a) Asset Values of each of the Real
Properties, plus (b) the book value of all other assets and interests
therein held by the Consolidated Parties (provided, that, the amounts
calculated pursuant to clauses (a) and (b) above (i) shall include, without
duplication, each Consolidated Parties’ interests in the assets of any Unconsolidated
Affiliate and (ii) shall not include any interests in assets which are
attributable to any Minority Interests), less (c) the value of all
intangible assets, if any, included in (a) and (b) above.


 


“Type” with respect to any Loan, refers to whether such Loan is
a Eurodollar Loan or Base Rate Loan.


 


“Unsecured Indebtedness” means, with respect to any Person and
for any given calculation date, all Indebtedness of such Person that is not
Secured Indebtedness, including all Indebtedness in respect of Capitalized
Lease Obligations (subject to the provisions and allocation rules set forth in
the definition of “Secured Indebtedness” set forth herein). For purposes of
calculating the Financial Covenants, the Credit Party Obligations and the Term
Loan Obligations shall be deemed Unsecured Indebtedness.


 


“Unused
Revolving Committed Amount” means, for any period, the daily average of the
amount by which (a) the then applicable Revolving Committed Amount exceeds
(b) the sum of (i) the outstanding aggregate principal amount of all
Revolving Loans plus (ii) the outstanding aggregate principal
amount of all LOC Obligations plus (iii) the Aggregate Derivative
Reserve Amount.


 


“USRP
Holding” has the meaning given to such
term in the Preamble of this Credit Agreement.


 


24

















 


“USRP
Holding Pledge Agreement” means that
certain Pledge and Security Agreement entered into by USRP Holding as of November
4, 2003 in favor of the Collateral Agent
and for the benefit of the Lender Parties.


 


“USRP Operating” has the meaning given to such term in the
Preamble of this Credit Agreement.


 


“USRP Pledge Agreement” means that certain Pledge and Security
Agreement entered into by USRP Operating as of the date hereof in favor of the
Collateral Agent and for the benefit of the Lender Parties.


 


“USRP REIT” means U.S. 
Restaurant Properties, Inc..


 


“Value”
means, with respect to any Consolidated Party’s interest in any Real Property,
the book value of such interest in Real Property plus accumulated
depreciation with respect thereto (provided, for purposes of clarification,
that the “Value” of any interest in Real Property shall not include any amount
of the book value of such Real Property interest attributable to Minority
Interests).


 


“Voting Stock”
means, with respect to any Person, Capital Stock issued by such Person the
holders of which are ordinarily, in the absence of contingencies, entitled to
vote for the election of directors (or persons performing similar functions) of
such Person, even though the right so to vote has been suspended by the
happening of such a contingency.


 


“Wholly
Owned Subsidiary” means any Person 100% of whose Voting Stock is at the
time owned by the Borrower directly or indirectly through other Persons 100% of
whose Voting Stock is at the time owned, directly or indirectly, by the
Borrower.


 


1.2          Computation of Time Periods.


 


For purposes of computation of periods of time hereunder, the word
“from” means “from and including” and the words “to” and “until” each mean “to
but excluding.”


 


1.3          Accounting Terms.


 


Except as otherwise expressly
provided herein, all accounting terms used herein shall be interpreted, and all
financial statements and certificates and reports as to financial matters
required to be delivered to the Lenders hereunder shall be prepared, in
accordance with GAAP applied on a consistent basis; provided, however,
that calculations of the implied principal component of all obligations under
any Synthetic Lease or the implied interest component of any rent paid under
any Synthetic Lease shall be made by the Borrower in accordance with accepted
financial practice and consistent with the terms of such Synthetic Lease.  All calculations made for the purposes of
determining compliance with this Credit Agreement shall (except as otherwise
expressly provided herein) be made by application of GAAP applied on a basis
consistent with the most recent annual or quarterly financial statements
delivered pursuant to Section 7.1 (or, prior to the delivery of the first
financial statements pursuant to Section 7.1, consistent with the
financial statements as at September 30, 2003), but, in any event, after
elimination for Unconsolidated Affiliate Interests; provided, however,
if (a) the Credit Parties shall object to determining such compliance on
such basis at the time of delivery of such financial statements due to any
change in GAAP or the rules promulgated with respect thereto or (b) the
Agent or the Required Lenders shall so object in writing within 60 days after
delivery of such financial statements, then such calculations shall be made on
a basis consistent with the most recent financial statements delivered by the
Credit Parties to the Lenders as to which no such objection shall have been
made.


 


Notwithstanding the above or anything contained herein to the contrary,
the provisions set forth in FAS 133 shall not be used in accounting for
derivatives instruments and hedging activities in the definitions contained
herein.


 


1.4          References to Agreements and Laws.


 


Unless otherwise expressly provided herein, (a) references to
organizational documents, agreements (including the Credit Documents and the
Term Loan Documents) and other contractual instruments shall be deemed


 


25

















 


to include all subsequent amendments, restatements, extensions,
supplements and other modifications thereto, but only to the extent that such
amendments, restatements, extensions, supplements and other modifications are
not prohibited by any Credit Document; and (b) references to any law,
rule, regulation, mandate, standard or requirement  shall include all provisions consolidating, amending, replacing,
supplementing or interpreting such law, rule, regulation, mandate, standard or
requirement.


 


1.5          Times of Day.


 


Unless otherwise specified, all references herein to times of day shall
be deemed to be references to Charlotte, North Carolina time.


 


 


ARTICLE II


 


CREDIT FACILITIES


 


2.1          Revolving Loans.


 


(a)           Revolving Commitment.  Subject to the terms and conditions hereof
and in reliance upon the representations and warranties set forth herein, each
Lender severally agrees to make available to the Borrower such Lender’s
Revolving Commitment Percentage of revolving credit loans requested by the
Borrower in Dollars (“Revolving Loans”) from time to time from the
Closing Date until the Maturity Date, or such earlier date as the Revolving
Commitments shall have been terminated as provided herein; provided, however,
(i) with regard to each Lender individually, such Lender’s outstanding
Revolving Loans shall not exceed such Lender’s Revolving Commitment Percentage
of the Revolving Committed Amount, (ii) the sum of (A) the aggregate
outstanding principal amount of Revolving Loans plus (B) the LOC
Obligations plus (C) the Aggregate Derivative Reserve Amount shall not
exceed the Revolving Committed Amount, and (iii) the sum of (A) the aggregate
outstanding principal amount of Revolving Loans plus (B) the LOC
Obligations plus (C) the Aggregate Derivative Exposure Amount, plus
(D) the then-outstanding Term Loan Obligations shall not exceed the Borrowing
Base.  Revolving Loans may consist of
Base Rate Loans or Eurodollar Loans, or a combination thereof, as the Borrower
may request (subject to the terms and conditions set forth herein); provided,
however, that no more than ten (10)  Eurodollar Loans shall be
outstanding hereunder at any time (it being understood that, for purposes
hereof, Eurodollar Loans with different Interest Periods shall be considered as
separate Eurodollar Loans, even if they begin on the same date, although
borrowings, extensions and conversions may, in accordance with the provisions
hereof, be combined at the end of existing Interest Periods to constitute a new
Eurodollar Loan with a single Interest Period).  The Revolving Loans made hereunder may be repaid and reborrowed
in accordance with the provisions hereof.


 


(b)           Revolving Loan Borrowings.


 


(i)            Notice of Borrowing.  The Borrower shall request a Revolving Loan
borrowing by written notice (or telephonic notice promptly confirmed in writing
in the form of a Notice of Borrowing) to the Agent not later than
11:00 A.M.  (Charlotte, North
Carolina time) on the Business Day prior to the date of the requested borrowing
in the case of Base Rate Loans, and on the third Business Day prior to the date
of the requested borrowing in the case of Eurodollar Loans.  Each such request for borrowing shall be
irrevocable and shall specify (A) that a Revolving Loan is requested,
(B) the date of the requested borrowing (which shall be a Business Day),
(C) the aggregate principal amount to be borrowed, (D) whether the
borrowing shall be comprised of Base Rate Loans, Eurodollar Loans or a
combination thereof, and if Eurodollar Loans are requested, the Interest
Period(s) therefor, and (E) that all conditions to such borrowing contained
herein (including those set forth in Section 5.2 hereof) have been fully
satisfied.  If the Borrower shall fail
to specify in any such Notice of Borrowing (I) an applicable Interest
Period in the case of a Eurodollar Loan, then such notice shall be deemed to be
a request for an Interest Period of one month, or (II) the type of
Revolving Loan requested, then such notice shall be deemed to be a request for
a Base Rate Loan hereunder.  The Agent
shall give notice to each affected Lender promptly upon receipt of each Notice


 


26

















 


of Borrowing pursuant to this
Section 2.1(b)(i), the contents thereof and each such Lender’s share of
any borrowing to be made pursuant thereto


 


(ii)           Minimum Amounts.  Each Eurodollar Loan or Base Rate Loan that
is a Revolving Loan shall be in a minimum aggregate principal amount of
$500,000 and integral multiples of $100,000 in excess thereof (or the remaining
amount of the Revolving Committed Amount, if less).


 


(iii)          Advances.  Each Lender will make its Revolving
Commitment Percentage of each Revolving Loan borrowing available to the Agent
for the account of the Borrower as specified in Section 3.15(a), or in
such other manner as the Agent may specify in writing, by 1:00 P.M.  (Charlotte, North Carolina time) on the date
specified in the applicable Notice of Borrowing in Dollars and in funds
immediately available to the Agent. 
Such borrowing will then be made available to the Borrower by the Agent
by crediting the account of the Borrower on the books of such office with the
aggregate of the amounts made available to the Agent by the Lenders and in like
funds as received by the Agent.


 


(c)           Repayment. The principal
amount of all Revolving Loans and all other amounts owed by the Borrower or any
Credit Party hereunder or under any Credit Document shall be due and payable as
follows:


 


 


(i)            The principal amount of all
Revolving Loans shall, subject to subclauses (ii) and (iii) below, be due and
payable in full October 31, 2005 (the “Initial Maturity Date”) unless
accelerated sooner pursuant to the terms and conditions set forth herein.


 


(ii)           The maturity date of the Revolving
Loans may be extended to October 31, 2006 (the “Extended Maturity Date”)
if a Successful Syndication is achieved on or prior to December 31, 2003.


 


(iii)          The maturity date of the Revolving
Loans may, in the absence of an extension pursuant to subclause (ii) above, be
extended to the Extended Maturity Date if the following conditions are
satisfied by the date specified:


 


(A)          Borrower has requested the extension
by written notice to Bank not more than sixty (60) days, and not less than
thirty (30) days, prior to the Initial Maturity Date;


 


(B)           the Borrower has, on or before the
Initial Maturity Date, paid to the Agent (for the benefit of the Lenders) an
extension fee (the “Extension Fee”) in an amount equal to one half of
one percent (0.50%) of the sum of the Revolving Commitments which will be in
effect immediately following the Initial Maturity Date;


 


(C)           all of the conditions precedent set
forth in Sections 5.1 and 5.2 hereof have been complied with or otherwise
satisfied as of the Initial Maturity Date and the Credit Parties remain in
compliance with such provisions and such conditions remain satisfied as of the
Initial Maturity Date;


 


(D)          current financial statements regarding
each Borrower and each Guarantor and all other financial statements and other
information as may be required hereunder regarding Borrower and each Guarantor
shall have been submitted promptly to the Agent concurrently with Borrower’s
request for the extension, and there shall not have occurred, in the opinion of
Agent, any material adverse change in the business or financial condition of
Borrowers or any Guarantor or in any other state of facts submitted to the
Agent in connection with the Credit Documents, from that which existed on the
Closing Date;


 


27

















 


(E)           the Agent and each Lender have
delivered to the Borrower their respective written approvals of the extension
referenced in this Section 2.1(c)(iii); provided, that each such approval shall
be conditioned only upon such Agent’s and Lenders’ reasonable determination
that the Credit Parties have satisfied each of the conditions to extension set
forth in this Section 2.1(c)(iii);


 


(F)           whether or not the extension becomes
effective, Borrower shall pay all out-of-pocket costs and expenses incurred by
the Agent and the Lenders in connection with the proposed extension (pre- and
post-closing), including, without limitation, appraisal fees and legal fees;
all such costs and expenses incurred up to the Initial Maturity Date shall be
due and payable prior to Agent’s and Lenders’ execution of their approval of
the extension referenced in Section 2.1(c)(iii)(E) or, if the proposed
extension does not become effective, then upon demand by the Agent), and any
future failure to pay such amounts shall constitute an Event of Default under
the Credit Documents; and


 


(G)           at the time of the request, and at
the time of the extension, there shall not exist any Default or Event of
Default under any Credit Document.


 


(iv)          As used herein, the term “Maturity
Date” means the latest to occur of (A) the Initial Maturity Date and (B) to
the extent either (1) a Successful Syndication is completed prior to the date
required in subclause (ii) above or (2) all conditions precedent to the
extension of the Revolving Loans as set forth in subclause (iii) above have
been satisfied, the Extended Maturity Date. 
For purposes of clarification, notwithstanding the possibility that the
conditions precedent set forth in Sections 2.1(c)(ii) or (iii) may be satisfied
as of a later date, the “Maturity Date” on any date prior to such satisfaction
shall be deemed to be the Initial Maturity Date.


 


(d)           Interest.  Subject to the provisions of
Section 3.1,


 


(i)            Base Rate Loans.  During such periods as Revolving Loans shall
be comprised in whole or in part of Base Rate Loans, such Base Rate Loans shall
bear interest at a per annum rate equal to the Adjusted Base Rate.


 


(ii)           Eurodollar Loans.  During such periods as Revolving Loans shall
be comprised in whole or in part of Eurodollar Loans, such Eurodollar Loans
shall bear interest at a per annum rate equal to the Adjusted Eurodollar Rate.


 


Interest on Revolving Loans shall be payable
in arrears on each applicable Interest Payment Date (or at such other times as
may be specified herein).


 


(e)           Revolving Notes.  The Revolving Loans made by each Lender
shall be evidenced by a duly executed promissory note of the Borrower to such
Lender in an original principal amount equal to such Lender’s Revolving
Commitment Percentage of the Revolving Committed Amount and in substantially
the form of Exhibit 2.1(e).


 


2.2          Letter of Credit Subfacility.


 


(a)           Issuance.  Subject to the terms and conditions hereof
and in reliance upon the representations and warranties set forth herein, the
Issuing Lender agrees to issue, and each Lender severally agrees to participate
in the issuance by the Issuing Lender of, standby and trade Letters of Credit
in Dollars from time to time from the Closing Date until the date
thirty (30) days prior to the Maturity Date as the Borrower may request,
in a form acceptable to the Issuing Lender; provided, however,
that (i) the LOC Obligations outstanding shall not at any time exceed FIVE
MILLION DOLLARS ($5,000,000) (the “LOC Committed Amount”), (ii) the
sum of (A) the aggregate outstanding principal amount of Revolving Loans plus
(B) the LOC Obligations plus (C) the Aggregate Derivative Reserve
Amount, shall not exceed the Revolving Committed Amount and (iii) the sum of
(A) the aggregate outstanding principal amount of Revolving Loans plus
(B) the


 


28

















 


LOC Obligations plus (C) the Aggregate
Derivative Exposure Amount, plus (D) the then-outstanding Term Loan
Obligations shall not exceed the Borrowing Base.  No Letter of Credit shall (x) have an original expiry date
more than one year from the date of issuance (provided that any such Letter of
Credit may contain customary “evergreen” provisions pursuant to which the
expiry date is automatically extended by a specific time period unless the
Issuing Lender gives notice to the beneficiary of such Letter of Credit at
least a specified time period prior to the expiry date then in effect) or
(y) as originally issued or as extended, have an expiry date extending
beyond the date thirty (30) days prior to the Maturity Date.  Each Letter of Credit shall comply with the
related LOC Documents.  The issuance
dates of each Letter of Credit shall be a Business Day.


 


(b)           Notice and Reports.  The request for the issuance of a Letter of
Credit shall be submitted by the Borrower to the Issuing Lender at least
three (3) Business Days prior to the requested date of issuance.  The Agent will, at least quarterly,
disseminate to each of the Lenders a detailed report specifying the Letters of
Credit which are then issued and outstanding and any activity with respect
thereto which may have occurred since the date of the prior report, and
including therein, among other things, the beneficiary, the face amount and the
expiry date, as well as any payment or expirations which may have occurred.


 


(c)           Participation.  Each Lender, upon issuance of a Letter of
Credit, shall be deemed to have purchased without recourse a Participation
Interest from the Issuing Lender in such Letter of Credit and the obligations
arising thereunder and any collateral relating thereto, in each case in an
amount equal to its pro rata share of the obligations under such Letter of
Credit (based on the respective Revolving Commitment Percentages of the
Lenders) and shall absolutely, unconditionally and irrevocably assume and be
obligated to pay to the Issuing Lender through the Agent and discharge when
due, its pro rata share of the obligations arising under such Letter of
Credit.  Without limiting the scope and
nature of each Lender’s Participation Interest in any Letter of Credit, to the
extent that the Issuing Lender has not been reimbursed as required hereunder or
under any such Letter of Credit, each such Lender shall pay to the Issuing
Lender its pro rata share of such unreimbursed drawing in same day funds on the
day of notification by the Agent of an unreimbursed drawing pursuant to the
provisions of subsection (d) below. 
The obligation of each Lender to so reimburse the Issuing Lender shall
be absolute and unconditional and shall not be affected by the occurrence of a
Default, an Event of Default or any other occurrence or event.  Any such reimbursement shall not relieve or
otherwise impair the obligation of the Borrower to reimburse the Issuing Lender
under any Letter of Credit, together with interest as hereinafter provided.


 


(d)           Reimbursement.  In the event of any drawing under any Letter
of Credit, the Issuing Lender will notify the Borrower and the Agent by the
close of the following Business Day. 
Unless the Borrower shall immediately notify the Agent that the Borrower
intends to otherwise reimburse the Issuing Lender for such drawing, the
Borrower shall be deemed to have requested that the Lenders make a Revolving
Loan in the amount of the drawing as provided in subsection (e) below on
the related Letter of Credit, the proceeds of which will be used to satisfy the
related reimbursement obligations.  The
Borrower promises to reimburse the Issuing Lender on the day of drawing under
any Letter of Credit (either with the proceeds of a Revolving Loan obtained
hereunder or otherwise) in same day funds. 
If the Borrower shall fail to reimburse the Issuing Lender as provided
hereinabove, the Borrower promises to pay the Issuing Lender interest on the
unreimbursed amount of such drawing on demand at a per annum rate equal to the
Adjusted Base Rate plus five percent (5.0%).  The Borrower’s reimbursement obligations hereunder shall be
absolute and unconditional under all circumstances irrespective of any rights
of setoff, counterclaim or defense to payment the Borrower may claim or have
against the Issuing Lender, the Agent, the Lenders, the beneficiary of the
Letter of Credit drawn upon or any other Person, including without limitation
any defense based on any failure of the Borrower or any other Credit Party to
receive consideration or the legality, validity, regularity or unenforceability
of the Letter of Credit.  The Issuing
Lender will promptly notify the other Lenders of the amount of any unreimbursed
drawing and each Lender shall promptly pay to the Agent for the account of the
Issuing Lender in Dollars and in immediately available funds, the amount of
such Lender’s pro rata share of such unreimbursed drawing.  Such payment shall be made on the day such
notice is received by such Lender from the Issuing Lender if such notice is
received at or before 2:00 P.M. 
(Charlotte, North Carolina time), and otherwise such payment shall be
made at or before 12:00 Noon (Charlotte, North Carolina time) on the Business
Day next succeeding the day such notice is received.  If such Lender does not pay such amount to the Issuing Lender in
full upon such request, such


 


29

















 


Lender shall, on demand, pay to the Agent for
the account of the Issuing Lender interest on the unpaid amount during the
period from the date of such drawing until such Lender pays such amount to the
Issuing Lender in full at a rate per annum equal to, if paid within
two (2) Business Days of the date that such Lender is required to make
payments of such amount pursuant to the preceding sentence, the Federal Funds
Rate and thereafter at a rate equal to the Base Rate.  Each Lender’s obligation to make such payment to the Issuing
Lender, and the right of the Issuing Lender to receive the same, shall be
absolute and unconditional, shall not be affected by any circumstance
whatsoever and without regard to the termination of this Credit Agreement or
the Commitments hereunder, the existence of a Default or Event of Default or
the acceleration of the obligations of the Borrower hereunder and shall be made
without any offset, abatement, withholding or reduction whatsoever.  Simultaneously with the making of each such
payment by a Lender to the Issuing Lender, such Lender shall, automatically and
without any further action on the part of the Issuing Lender or such Lender,
acquire a Participation Interest in an amount equal to such payment (excluding
the portion of such payment constituting interest owing to the Issuing Lender)
in the related unreimbursed drawing portion of the LOC Obligation and in the
interest thereon and in the related LOC Documents, and shall have a claim
against the Borrower with respect thereto.


 


(e)           Repayment with Revolving Loans.  On any day on which the Borrower shall have
requested, or been deemed to have requested, a Revolving Loan advance to
reimburse a drawing under a Letter of Credit, the Agent shall give notice to
the Lenders that a Revolving Loan has been requested or deemed requested by the
Borrower to be made in connection with a drawing under a Letter of Credit, in
which case a Revolving Loan advance comprised of Base Rate Loans (or Eurodollar
Loans to the extent the Borrower has complied with the procedures of
Section 2.1(b)(i) with respect thereto) shall be immediately made to the
Borrower by all Lenders (notwithstanding any termination of the Commitments
pursuant to Section 9.2) pro  rata based on the respective
Revolving Commitment Percentages of the Lenders (determined before giving
effect to any termination of the Commitments pursuant to Section 9.2) and
the proceeds thereof shall be paid directly to the Issuing Lender for
application to the respective LOC Obligations. 
Each such Lender hereby irrevocably agrees to make its pro rata share of
each such Revolving Loan immediately upon any such request or deemed request in
the amount, in the manner and on the date specified in the preceding sentence notwithstanding
(i) the amount of such borrowing may not comply with the minimum amount
for advances of Revolving Loans otherwise required hereunder, (ii) whether
any conditions specified in Section 5.2 are then satisfied, (iii) whether
a Default or an Event of Default then exists, (iv) failure for any such
request or deemed request for Revolving Loan to be made by the time otherwise
required hereunder, (v) whether the date of such borrowing is a date on
which Revolving Loans are otherwise permitted to be made hereunder or
(vi) any termination of the Commitments relating thereto immediately prior
to or contemporaneously with such borrowing. 
In the event that any Revolving Loan cannot for any reason be made on
the date otherwise required above (including, without limitation, as a result
of the commencement of a proceeding under the Bankruptcy Code with respect to
the Borrower or any other Credit Party), then each such Lender hereby agrees
that it shall forthwith purchase (as of the date such borrowing would otherwise
have occurred, but adjusted for any payments received from the Borrower on or
after such date and prior to such purchase) from the Issuing Lender such
Participation Interests in the outstanding LOC Obligations as shall be necessary
to cause each such Lender to share in such LOC Obligations ratably (based upon
the respective Revolving Commitment Percentages of the Lenders (determined
before giving effect to any termination of the Commitments pursuant to
Section 9.2)), provided that at the time any purchase of
Participation Interests pursuant to this sentence is actually made, the
purchasing Lender shall be required to pay to the Issuing Lender, to the extent
not paid to the Issuing Lender by the Borrower in accordance with the terms of
subsection (d) above, interest on the principal amount of Participation
Interests purchased for each day from and including the day upon which such
borrowing would otherwise have occurred to but excluding the date of payment
for such Participation Interests, at the rate equal to, if paid within
two (2) Business Days of the date of the Revolving Loan advance, the
Federal Funds Rate, and thereafter at a rate equal to the Base Rate.


 


(f)            Designation of Consolidated
Parties as Account Parties.  Notwithstanding
anything to the contrary set forth in this Credit Agreement, including without
limitation Section 2.2(a), a Letter of Credit issued hereunder may contain
a statement to the effect that such Letter of Credit is issued for the account
of any Subsidiary of the Borrower, provided that notwithstanding such
statement, the Borrower shall be the actual account party for all purposes of
this Credit Agreement for such Letter of Credit and such statement shall not
affect the Borrower’s reimbursement obligations hereunder with respect to such
Letter of Credit.


 


30

















 


(g)           Renewal, Extension.  The renewal or extension of any Letter of
Credit shall, for purposes hereof, be treated in all respects the same as the
issuance of a new Letter of Credit hereunder.


 


(h)           Uniform Customs and Practices.  The Issuing Lender may have the Letters of
Credit be subject to The Uniform Customs and Practice for Documentary Credits
(the “UCP”) or the International Standby Practices 1998 (the “ISP98”),
in either case as published as of the date of issue by the International
Chamber of Commerce, in which case the UCP or the ISP98, as applicable, may be
incorporated therein and deemed in all respects to be a part thereof.


 


(i)            Indemnification; Nature of
Issuing Lender’s Duties.


 


(i)            In addition to its other obligations
under this Section 2.2, the Borrower hereby agrees to pay, and protect,
indemnify and save each Lender harmless from and against, any and all claims,
demands, liabilities, damages, losses, costs, charges and expenses (including
reasonable attorneys’ fees) that such Lender may incur or be subject to as a
consequence, direct or indirect, of (A) the issuance of any Letter of
Credit or (B) the failure of such Lender to honor a drawing under a Letter
of Credit as a result of any act or omission, whether rightful or wrongful, of
any present or future de jure or de facto government or Governmental Authority
(all such acts or omissions, herein called “Government Acts”).


 


(ii)           As between the Borrower and the
Lenders (including the Issuing Lender), the Borrower shall assume all risks of
the acts, omissions or misuse of any Letter of Credit by the beneficiary
thereof.  No Lender (including the
Issuing Lender) shall be responsible: 
(A) for the form, validity, sufficiency, accuracy, genuineness or
legal effect of any document submitted by any party in connection with the
application for and issuance of any Letter of Credit, even if it should in fact
prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged; (B) for the validity or sufficiency of any
instrument transferring or assigning or purporting to transfer or assign any
Letter of Credit or the rights or benefits thereunder or proceeds thereof, in
whole or in part, that may prove to be invalid or ineffective for any reason;
(C) for errors, omissions, interruptions or delays in transmission or
delivery of any messages, by mail, cable, telegraph, telex or otherwise,
whether or not they be in cipher; (D) for any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under a Letter of Credit or of the proceeds thereof; and (E) for any
consequences arising from causes beyond the control of such Lender, including,
without limitation, any Government Acts. 
None of the above shall affect, impair, or prevent the vesting of the
Issuing Lender’s rights or powers hereunder.


 


(iii)          In furtherance and extension and not
in limitation of the specific provisions hereinabove set forth, any action
taken or omitted by any Lender (including the Issuing Lender), under or in
connection with any Letter of Credit or the related certificates, if taken or
omitted in good faith, shall not put such Lender under any resulting liability
to the Borrower or any other Credit Party. 
It is the intention of the parties that this Credit Agreement shall be
construed and applied to protect and indemnify each Lender (including the
Issuing Lender) against any and all risks involved in the issuance of the Letters
of Credit, all of which risks are hereby assumed by the Borrower (on behalf of
itself and each of the other Credit Parties), including, without limitation,
any and all Government Acts.  No Lender
(including the Issuing Lender) shall, in any way, be liable for any failure by
such Lender or anyone else to pay any drawing under any Letter of Credit as a
result of any Government Acts or any other cause beyond the control of such
Lender.


 


(iv)          Nothing in this subsection (i) is
intended to limit the reimbursement obligations of the Borrower contained in
subsection (d) above.  The
obligations of the Borrower under this subsection (i) shall survive the
termination of this Credit Agreement. 
No act or omission of any current or prior beneficiary of a Letter of
Credit shall in any way affect or impair the rights of the Lenders (including
the Issuing Lender) to enforce any right, power or benefit under this Credit
Agreement.


 


31

















 


(v)           Notwithstanding anything to the contrary
contained in this subsection (i), the Borrower shall have no obligation to
indemnify any Lender (including the Issuing Lender) in respect of any liability
incurred by such Lender (A) arising solely out of the gross negligence or
willful misconduct of such Lender, as determined by a court of competent
jurisdiction, or (B) caused by such Lender’s failure to pay under any
Letter of Credit after presentation to it of a request strictly complying with
the terms and conditions of such Letter of Credit, as determined by a court of
competent jurisdiction, unless such payment is prohibited by any law,
regulation, court order or decree.


 


(j)            Responsibility of Issuing Lender.  It is expressly understood and agreed that
the obligations of the Issuing Lender hereunder to the Lenders are only those
expressly set forth in this Credit Agreement and that the Issuing Lender shall
be entitled to assume that the conditions precedent set forth in
Section 5.2 have been satisfied unless it shall have acquired actual knowledge
that any such condition precedent has not been satisfied; provided, however,
that nothing set forth in this Section 2.2 shall be deemed to prejudice
the right of any Lender to recover from the Issuing Lender any amounts made
available by such Lender to the Issuing Lender pursuant to this
Section 2.2 in the event that it is determined by a court of competent
jurisdiction that the payment with respect to a Letter of Credit constituted
gross negligence or willful misconduct on the part of the Issuing Lender.


 


(k)           Conflict with LOC Documents.  In the event of any conflict between this
Credit Agreement and any LOC Document (including any letter of credit
application), this Credit Agreement shall control.


 


2.3          Derivative Exposure Reserve.


 


(a)           Establishment of Reserve.  To the extent the Borrower (as credit
support provider), pursuant to the terms of any BOA Derivative Instrument, is
required to provide collateral or other credit support for the General
Partner’s or the USRP REIT’s obligations under such BOA Derivative Instrument,
the Agent shall, subject to the terms and conditions set forth in this
Section 2.3 and the consent of the applicable Derivative Counterparty,
reserve an amount of Availability which when combined with all then existing
Availability reserves is equal to or less than SEVEN MILLION FIVE HUNDRED
THOUSAND AND NO/100 DOLLARS ($7,500,000.00) (the “Reserve Limit”) in
satisfaction of such requirement.  The
term “Derivative Exposure Reserve” shall mean, with respect to any given
BOA Derivative Instrument, the reserve established pursuant to this
Section 2.3 in connection with such BOA Derivative Instrument.  Notwithstanding anything to the contrary
contained in this Credit Agreement, Availability reserved pursuant to this
Section 2.3 shall be deemed an outstanding principal advance hereunder for
purposes of the covenant calculations required hereunder (including, without
limitation, the covenant calculations required pursuant to Sections 7.11
and 8.1 hereof).


 


 (b)          Conditions.  If, at any time on or prior to the Business
Day occurring five (5) days prior to the date of the termination of this
Credit Agreement, Agent has received notice of the Borrower’s obligation (as
credit support provider), pursuant to a given BOA Derivative Instrument, to provide
collateral or other credit support for the General Partner’s or the USRP REIT’s
obligations thereunder, the Agent shall, within one (1) Business Day of
receiving notice thereof, establish a Derivative Exposure Reserve in connection
with such BOA Derivative Instrument to the extent that (i) the applicable
Derivative Counterparty has consented to the establishment of a Derivative
Exposure Reserve with respect to the Borrower’s obligations (as credit support
provider) under such BOA Derivative Instrument; (ii) the sum of (A) the aggregate outstanding principal amount of the
Revolving Loans, plus (B) the LOC Obligations, plus (C) the
then-outstanding Term Loan Obligations,  plus
(D) the amount of the pending Derivative Exposure Reserve is less than the
Revolving Committed Amount; (iii) the sum of (A) the aggregate
outstanding principal amount of Revolving Loans plus (B) the LOC
Obligations plus (C) the Aggregate Derivative Exposure Amount, plus
(D) the then-outstanding Term Loan Obligations plus (E) the amount of the
pending Derivative Exposure Reserve is less than the then-applicable
Borrowing Base and (iv) to the Agent’s
knowledge, no Default or Event of Default exists as of the date on which the
applicable notice is received.


 


(c)           Adjustment of Reserve Amounts.  The amount of any given Derivative Exposure
Reserve shall be adjusted (either up or down, as applicable) from time to time
by the Agent upon receipt by the Agent of any notice from a Derivative
Counterparty that the Borrower’s obligation (as credit support provider) to
provide


 


32

















 


collateral or other credit support for the
General Partner’s or the USRP REIT’s obligations under the applicable BOA
Derivative Instrument has increased or decreased; provided, that the Agent
shall not be required to make such adjustment to the extent (i) any increase in
the Borrower’s obligation (as credit support provider) to provide collateral or
other credit support for the General Partner’s or the USRP REIT’s obligations
under the applicable BOA Derivative Instrument would cause the sum of (A) the aggregate outstanding
principal amount of the Revolving Loans, plus (B) the LOC Obligations, plus
(C) the Aggregate Derivative Reserve Amount to exceed the Revolving Committed
Amount, (ii) such increase would cause the sum of (A) the aggregate outstanding
principal amount of the Revolving Loans, plus (B) the LOC Obligations, plus
(C) the Aggregate Derivative Reserve Amount, plus (D) the
then-outstanding Term Loan Obligations to exceed the Borrowing Base or (iii)
such increase would cause the aggregate amount of the Derivative Exposure
Reserve to exceed the Reserve Limit.


 


(d)           Notices.  The Borrower (i) hereby consents to the
establishment of Derivative Exposure Reserves with respect to any BOA
Derivative Instrument existing as of the date hereof or later existing, (ii)
hereby consents to the delivery by each Derivative Counterparty to the Agent of
all notices, reports and other information regarding any BOA Derivative
Instrument concurrently with or prior to the delivery thereof to the Borrower,
and (iii) agrees to direct and hereby directs each Derivative Counterparty to
so deliver such notices, reports and other information to the Agent.   The Agent hereby agrees to provide to the
Borrower notice, (i) within three (3) Business Days, of the establishment
of a given Derivative Exposure Reserve, the underlying BOA Derivative
Instrument and the amount of such Derivative Exposure Reserve; (ii) within
three (3) Business Days, any adjustment in the amount of a given
Derivative Exposure Reserve and (iii) within three (3) Business Days, of
the making of any Revolving Loan in satisfaction of the Borrower’s obligations
under a given BOA Derivative Instrument in connection with subsection (f)
of this Section 2.3.


 


(e)           Payment from Derivative Exposure
Reserve.  In the event any
Derivative Counterparty forecloses upon or otherwise redeems its interest in
any amount allocated as a Derivative Exposure Reserve and so notifies the Agent
and Borrower of such foreclosure/redemption, the Borrower shall be deemed to
have requested that the Lenders make a Revolving Loan in the amount of the
applicable Derivative Exposure Reserve as provided in subsection (f)
below.  The Borrower hereby (i) consents
to the application of the proceeds resulting from any Revolving Loans made
pursuant to subsection (f) of this Section 2.3 to the Borrower’s
obligations under the applicable BOA
Derivative Instrument, (ii) covenants and agrees, to the extent it receives any of the proceeds resulting from any
Revolving Loans made pursuant to subsection (f) of this Section 2.3,
to apply such proceeds to its obligations under the applicable BOA Derivative Instrument immediately upon its
receipt thereof and (iii) agrees that, notwithstanding anything to the contrary
contained herein, failure to adhere to the terms of this Section 2.3 will
result in an immediate Event of Default hereunder.


 


(f)            Repayment with Revolving Loans.  On any day on which the Borrower shall have
been deemed, pursuant to subsections (e) or (g) of this Section 2.3,
to have requested a Revolving Loan advance in connection with a given
Derivative Exposure Reserve, the Agent shall give notice to the Lenders that a
Revolving Loan has been deemed requested by the Borrower in connection with
such Derivative Exposure Reserve. 
Concurrently with such notice, a Revolving Loan advance comprised of
Base Rate Loans (or Eurodollar Loans to the extent the Borrower has complied
with the procedures of Section 2.1(b)(i) with respect thereto) shall be
immediately made to the Borrower by all Lenders (notwithstanding any
termination of the Commitments pursuant to Section 9.2) pro  rata
based on the respective Revolving Commitment Percentages of the Lenders
(determined before giving effect to any termination of the Commitments pursuant
to Section 9.2) and the proceeds thereof shall be paid directly to the
applicable Derivative Counterparty for application to the applicable BOA
Derivative Instrument or as cash collateral therefor, as applicable.  Each Lender hereby irrevocably agrees to
make its pro rata share of each such Revolving Loan immediately upon any such
request or deemed request in the amount, in the manner and on the date
specified in the preceding sentence notwithstanding (i) the amount
of such borrowing may not comply with the minimum amount for advances of
Revolving Loans otherwise required hereunder, (ii) whether any conditions
specified in Section 5.2 are then satisfied, (iii) whether a Default
or an Event of Default then exists, (iv) failure for any such request or
deemed request for Revolving Loan to be made by the time otherwise required
hereunder, (v) whether the date of such borrowing is a date on which
Revolving Loans are otherwise permitted to be made hereunder or (vi) any
termination of the Commitments relating thereto immediately prior to or
contemporaneously with such


 


33

















 


borrowing. 
In the event that any Revolving Loan cannot for any reason be made on
the date otherwise required above (including, without limitation, as a result
of the commencement of a proceeding under the Bankruptcy Code with respect to
the Borrower or any other Credit Party), then each Lender hereby agrees that it
shall forthwith purchase (as of the date such borrowing would otherwise have
occurred, but adjusted for any payments received from the Borrower on or after
such date and prior to such purchase) from the Derivative Counterparty (to the
extent expressly permitted by such Derivative Counterparty) such interests in
the applicable BOA Derivative Instrument as
shall be necessary to cause each such Lender to share in the obligations
secured by the applicable Derivative Exposure Reserve ratably (based upon the
respective Revolving Commitment Percentages of the Lenders (determined before
giving effect to any termination of the Commitments pursuant to
Section 9.2)).


 


(g)           Termination of
Derivative Exposure Reserves.  The
respective Derivative Exposure Reserves established pursuant to this
Section 2.3 shall be terminated upon the earlier of (i) the termination of
the underlying BOA Derivative Instrument and subsequent payment by the Borrower
of all amounts due thereunder, either through the making of Revolving Loans
under subsection (f) hereof or otherwise, (ii) the Business Day occurring
immediately preceding the Maturity Date, (iii) the Business Day occurring
immediately preceding the date of the termination of this Credit Agreement
other than as a result of the occurrence of the Maturity Date.  To the extent the Derivative Exposure
Reserves are terminated pursuant to subsections (i), (ii) or (iii) above,
the Borrower shall, as of the date of such termination, be deemed to have
requested Revolving Loans to be made in accordance with subsection (f)
hereof in an amount equal to the Aggregate Derivative Reserve Amount for the
purpose of providing cash collateral to secure its obligations under the BOA
Derivative Instruments for which Derivative Exposure Reserves exist on such
date; provided, however, that to the extent the Derivative Exposure Reserves
are to be terminated as a result of the occurrence of the Maturity Date, the
Borrower shall be permitted to provide such collateral as may be acceptable to
the Derivative Counterparty in lieu of a funding of Revolving Loans hereunder
if and to the extent (A) the Borrower provides fifteen (15) Business Days
notice of its intention to provide such collateral, (B) the Borrower delivers
such collateral to the Derivative Counterparty five (5) Business Days
prior to the Maturity Date and (C) such collateral is deemed acceptable by the
Derivative Counterparty.


 


2.4          Joint and Several
Liability of the Borrowers.


 


(a)           Each of the Borrowers is accepting
joint and several liability hereunder in consideration of the financial
accommodation to be provided by the Lenders under this Credit Agreement, for
the mutual benefit, directly and indirectly, of each of the Borrowers and in
consideration of the undertakings of each of the Borrowers to accept joint and
several liability for the obligations of each of them.


 


(b)           Each of the Borrowers jointly and
severally hereby irrevocably and unconditionally accepts, not merely as a
surety but also as a co-debtor, joint and several liability with the other
Borrowers with respect to the payment and performance of all of the Credit
Party Obligations arising under this Credit Agreement and the other Credit
Documents, it being the intention of the parties hereto that all the Credit
Party Obligations shall be the joint and several obligations of each of the Borrowers
without preferences or distinction among them.


 


(c)           If and to the extent that any of the
Borrowers shall fail to make any payment with respect to any of the obligations
hereunder as and when due or to perform any of such obligations in accordance with
the terms thereof, then in each such event, the other Borrowers will make such
payment with respect to, or perform, such obligation.


 


(d)           The obligations of each Borrower
under the provisions of this Section 2.4 constitute full recourse
obligations of such Borrower, enforceable against it to the full extent of its
properties and assets, irrespective of the validity, regularity or
enforceability of this Credit Agreement or any other circumstances whatsoever.


 


(e)           Except as otherwise expressly
provided herein, each Borrower hereby waives notice of acceptance of its joint
and several liability, notice of occurrence of any Default or Event of Default
(except


 


34

















 


to the extent notice is expressly required to
be given pursuant to the terms of this Credit Agreement), or of any demand for
any payment under this Credit Agreement, notice of any action at any time taken
or omitted by the Lender under or in respect of any of the Credit Party
Obligations hereunder, any requirement of diligence and, generally, all
demands, notices and other formalities of every kind in connection with this
Credit Agreement.  Each Borrower hereby
assents to, and waives notice of, any extension or postponement of the time for
the payment of any of the Credit Party Obligations hereunder, the acceptance of
any partial payment thereon, any waiver, consent or other action or
acquiescence by the Lenders at any time or times in respect of any default by
any Borrower in the performance or satisfaction of any term, covenant,
condition or provision of this Credit Agreement, any and all other indulgences
whatsoever by the Lenders in respect of any of the Credit Party Obligations
hereunder, and the taking, addition, substitution or release, in whole or in
part, at any time or times, of any security for any of such Credit Party
Obligations or the addition, substitution or release, in whole or in part, of
any Borrower.  Without limiting the
generality of the foregoing, each Borrower assents to any other action or delay
in acting or any failure to act on the part of the Lender, including, without
limitation, any failure strictly or diligently to assert any right or to pursue
any remedy or to comply fully with applicable laws or regulations thereunder
which might, but for the provisions of this Section 2.4, afford grounds
for terminating, discharging or relieving such Borrower, in whole or in part,
from any of its obligations under this Section 2.4, it being the intention
of each Borrower that, so long as any of the Credit Party Obligations hereunder
remain unsatisfied, the obligations of such Borrower under this
Section 2.4 shall not be discharged except by performance and then only to
the extent of such performance.  The
obligations of each Borrower under this Section 2.4 shall not be
diminished or rendered unenforceable by any winding up, reorganization,
arrangement, liquidation, reconstruction or similar proceeding with respect to
any reconstruction or similar proceeding with respect to any Borrower or any Lender.  The joint and several liability of the
Borrowers hereunder shall continue in full force and effect notwithstanding any
absorption, merger, amalgamation or any other change whatsoever in the name,
membership, constitution or place of formation of any Borrower or any Lender.


 


(f)            The provisions of this
Section 2.4 are made for the benefit of the Agent and the Lenders and
their respective successors and assigns, and may be enforced by any such Person
from time to time against any of the Borrowers as often as occasion therefor
may arise and without requirement on the part of any Lender first to marshal
any of its claims or to exercise any of its rights against any of the other
Borrowers or to exhaust any remedies available to it against any of the other
Borrowers or to resort to any other source or means of obtaining payment of any
of the Credit Party Obligations or to elect any other remedy.  Without limiting the generality of the
foregoing, each Borrower hereby specifically waives the benefits of N.C.  Gen. 
Stat.  §§26-7 through 26-9,
inclusive, to the extent applicable. 
The provisions of this Section 2.4 shall remain in effect until all
the Credit Party Obligations hereunder shall have been paid in full or
otherwise fully satisfied.  If at any
time, any payment, or any part thereof, made in respect of any of the Credit
Party Obligations, is rescinded or must otherwise be restored or returned by
the Lenders upon the insolvency, bankruptcy or reorganization of any of the
Borrowers, or otherwise, the provisions of this Section 2.4 will forthwith
be reinstated and in effect as though such payment had not been made.


 


(g)           Notwithstanding any provision to the
contrary contained herein or in any other of the Credit Documents or Hedging
Agreements, the obligations of each Borrower hereunder shall be limited to an
aggregate amount equal to the largest amount that would not render its
obligations hereunder subject to avoidance under Section 548 of the
Bankruptcy Code or any comparable provisions of any applicable state law.


 


2.5          Appointment
of Principal Borrower as Agent for Borrowers.


 


Each Borrower hereby appoints the Principal Borrower to act as its
exclusive agent for all purposes under this Credit Agreement and the other
Credit Documents (including, without limitation, with respect to all matters
related to the borrowing and repayment of loans as described in Articles II and
III hereof).  Each Borrower acknowledges
and agrees that (a) the Principal Borrower may execute such documents on behalf
of all the Borrowers as the Principal Borrower deems appropriate in its sole
discretion and each Borrower shall be bound by


 


35

















 


and obligated by all of the terms of any such document executed by the
Principal Borrower on its behalf, (b) any notice or other communication
delivered by the Agent or any Lender hereunder to the Principal Borrower shall
be deemed to have been delivered to each Borrower and (c) the Agent and each of
the Lenders shall accept (and shall be permitted to rely on) any document or
agreement executed by the Principal Borrower on behalf of the Borrowers (or any
of them).  The Borrowers must act
through the Principal Borrower for all purposes under this Credit Agreement and
the other Credit Documents.  Notwithstanding
anything contained herein to the contrary, to the extent any provision in this
Credit Agreement requires any Borrower to interact in any manner with the Agent
or the Lenders, such Borrower shall do so through the Principal Borrower.


 


ARTICLE III


 


OTHER PROVISIONS RELATING TO CREDIT FACILITIES


 


3.1          Default Rate.


 


Upon the occurrence, and during the continuance, of an Event of
Default, (i) the principal of and, to the extent permitted by law,
interest on the Loans and any other amounts owing hereunder or under the other
Credit Documents shall bear interest, payable on demand, at a per annum rate
equal to the Adjusted Base Rate plus five percent (5.0%) and
(ii) the Letter of Credit Fee and the Derivative Exposure Usage Fee shall
each accrue at a per annum rate five percent (5.0%) greater than the rate which
would otherwise be applicable.


 


3.2          Continuation/Conversion.


 


(a)           So long as no Event of Default shall
have occurred and be continuing and to the extent permitted in the definition
of the term “Interest Period”, the Borrower may on any Business Day, with
respect to any Eurodollar Loan, elect to maintain such Eurodollar Loan or any
portion thereof as a Eurodollar Loan by selecting a new Interest Period for
such Eurodollar Loan.  Each new Interest
Period selected under this Section 3.2 shall commence on the last day of
the immediately preceding Interest Period. 
Each selection of a new Interest Period shall be made by the Borrower
giving to the Agent a Notice of Continuation not later than
11:00 A.M.  on the third Business
Day prior to the date of any such Continuation.  Such notice by the Borrower of a Continuation shall be by
telephone or telecopy, confirmed immediately in writing if by telephone, in the
form of a Notice of Continuation, (a) specifying (i) the proposed date of such
Continuation, (ii) the Eurodollar Loan and portion thereof subject to such
Continuation and (iii) the duration of the selected Interest Period, all of
which shall be specified in such manner as is necessary to comply with all
limitations on Loans outstanding hereunder and (b) containing
certifications of the Borrower with respect to the conditions set forth in
Section 5.2 clauses (b) through (e) as set forth in Exhibit 3.2.  Each
Notice of Continuation shall be irrevocable by and binding on the Borrower once
given.  Promptly after receipt of a
Notice of Continuation, the Agent shall notify each Lender Party by telecopy or
other similar form of transmission of the proposed Continuation.  If the Borrower shall fail to select in a
timely manner a new Interest Period for any Eurodollar Loan in accordance with
this Section 3.2(a), such Loan will automatically, on the last day of the
current Interest Period therefor, Convert into a Base Rate Loan notwithstanding
failure of the Borrower to comply with Section 3.2(b).


 


(b)           So long as no Default or Event of
Default shall have occurred and be continuing, the Borrower may on any Business
Day, upon the Borrower’s giving of a Notice of Conversion to the Agent, Convert
all or a portion of a Loan of one Type into a Loan of another Type.  Any Conversion of a Eurodollar Loan into a
Base Rate Loan shall be made on, and only on, the last day of an Interest
Period for such Eurodollar Loan and, upon Conversion of a Base Rate Loan into a
Eurodollar Loan, the Borrower shall pay accrued interest to the date of
Conversion on the principal amount so Converted.  Each such Notice of Conversion shall be given not later than
12:00 noon on the Business Day prior to the date of any proposed Conversion
into Base Rate Loans and on the third Business Day prior to the date of any
proposed Conversion into Eurodollar Loans. 
Promptly after receipt of a Notice of Conversion, the Agent shall notify
each Lender Party by telecopy or other similar form of transmission of the
proposed Conversion.  Subject to the
restrictions specified above, each Notice of Conversion shall be by
telephone (confirmed immediately in writing) or telecopy in the form of a
Notice of Conversion (a) specifying (i) the requested date of such Conversion,
(ii) the Type of Loan to be Converted, (iii) the portion of such Type of Loan
to be


 


36

















 


Converted, (iv) the Type of Loan such Loan is
to be Converted into and (v) if such Conversion is into a Eurodollar Loan, the
requested duration of the Interest Period of such Loan, and (b)
containing certifications of the Borrower with respect to the conditions set
forth in Section 5.2 clauses (b) through (e) as set forth in Exhibit 3.2.  Each
Notice of Conversion shall be irrevocable by and binding on the Borrower once
given.


 


3.3          Prepayments.


 


(a)           Voluntary
Prepayments.  The Borrower shall
have the right to prepay Loans in whole or in part from time to time; provided,
however, that (i) each partial prepayment of Loans shall be in a
minimum principal amount of $500,000 and integral multiples of $100,000 in
excess thereof (or the then remaining principal balance of the Revolving Loans,
(ii) each partial prepayment shall be accompanied by interest on the principal
amount prepaid through the date of prepayment and shall include payment for any
and all applicable fees, expenses, breakage costs and redeployment costs
incurred by the Lenders and the Agent as a result thereof (as such amounts are
reasonably calculated by the Lenders and the Agent, as applicable, and
communicated to the Borrower) and (iii) all such voluntary prepayments shall be
made to the Collateral Agent for allocation in accordance with the
Intercreditor Agreement.  Subject to the
foregoing terms, amounts prepaid under this Section 3.3(a) shall be
applied as the Borrower may elect; provided that if the Borrower shall
fail to specify with respect to any voluntary prepayment, such voluntary
prepayment shall be applied first to Base Rate Loans and then to Eurodollar
Loans in direct order of Interest Period maturities.  All prepayments under this Section 3.3(a) shall be subject
to Section 3.12, but otherwise without premium or penalty.


 


(b)           Mandatory
Prepayments.


 


(i)            (A)          Revolving Committed Amount.  If, at any time, the sum of (1) the
aggregate outstanding principal amount of Revolving Loans, plus (2) the
LOC Obligations, plus (3) the Aggregate Derivative Reserve Amount shall
exceed the Revolving Committed Amount, the Borrower immediately shall prepay
the Revolving Loans, (after all Revolving Loans have been repaid) cash
collateralize the LOC Obligations, and (after all Revolving Loans have been
paid and all LOC Obligations have been fully cash collateralized) cash
collateralize the then-existing Derivative Exposure Reserves in an amount
sufficient to eliminate such excess.


 


(B)           LOC
Committed Amount.  If, at any time,
the sum of the aggregate principal amount of LOC Obligations shall exceed the
LOC Committed Amount, the Borrower immediately shall cash collateralize the LOC
Obligations in an amount sufficient to eliminate such excess.


 


(C)           Derivative
Exposure Reserves.  If, at any time,
the sum of the Aggregate Derivative Reserve Amount shall exceed the Reserve
Limit, the Borrower immediately shall cash collateralize its Aggregate
Derivative Reserve Amount obligations in an amount sufficient to eliminate such
excess.


 


(D)          Borrowing
Base.  If, at any time, the sum of
(1) the aggregate outstanding principal amount of Revolving Loans, plus
(2) the LOC Obligations, plus (3) the Aggregate Derivative Reserve
Amount, plus (4) the then-outstanding Term Loan Obligations shall exceed
the Borrowing Base, the Borrower immediately shall prepay the principal amount
of the Credit Party Obligations and/or Term Loan Obligations (as determined by
the distribution provisions of the Intercreditor Agreement) in an amount
sufficient to eliminate such excess.


 


(ii)           Application of Mandatory
Prepayments.  All amounts required
to be paid pursuant to this Section 3.3(b) shall, upon receipt by Agent
from Collateral Agent in accordance with the Intercreditor Agreement, be
applied as follows: (A) with respect to all amounts prepaid pursuant to
Section 3.3(b)(i)(A) or (D), first, to the Revolving Loans, then (after
all Revolving Loans have been repaid) to the cash collateralization of the LOC
Obligations, and then (after all Revolving Loans have been paid and all LOC
Obligations have been fully cash collateralized) to the cash collateralization
of


 


37

















 


the then-existing Derivative Exposure
Reserves, (B) with respect to all amounts prepaid pursuant to
Section 3.3(b)(i)(B), to a cash collateral account in respect of LOC
Obligations and (C) with respect to all amounts prepaid pursuant to Section 3.3(b)(i)(C),
to a cash collateral account in respect of the Borrower’s Aggregate Derivative
Reserve Amount obligations.  Within the
parameters of the applications set forth above, prepayments shall be applied
first to Base Rate Loans and then to Eurodollar Loans in direct order of
Interest Period maturities.  All
prepayments under this Section 3.3(b) shall be subject to
Section 3.12, but otherwise without premium or penalty, and shall be
accompanied by interest on the principal amount prepaid through the date of
prepayment. All prepayments made hereunder shall be made to the Collateral
Agent for allocation in accordance with the Intercreditor Agreement.


 


3.4          Termination, Reduction or Increase of Revolving
Committed Amount.


 


(a)           Voluntary Reductions.  The Borrower may from time to time
permanently reduce or terminate the Revolving Committed Amount in whole or in
part (in minimum aggregate amounts of $5,000,000 or in integral multiples of
$5,000,000 in excess thereof (or, if less, the full remaining amount of the
then applicable Revolving Committed Amount)) upon five (5) Business Days’
prior written notice to the Agent; provided, however, no such
termination or reduction shall be made which would cause (i) the sum of the
aggregate outstanding principal amount of Revolving Loans, plus the LOC
Obligations, plus the Aggregate Derivative Reserve Amount to exceed the
Revolving Committed Amount, or (ii) the sum of the aggregate outstanding
principal amount of Revolving Loans, plus the LOC Obligations, plus
the Aggregate Derivative Reserve Amount, plus the then-outstanding Term
Loan Obligations to exceed the Borrowing Base unless, concurrently with such
termination or reduction, the Revolving Loans are repaid to the extent
necessary to eliminate such excess or excesses.  The Agent shall promptly notify each affected Lender of receipt
by the Agent of any notice from the Borrower pursuant to this
Section 3.4(a).


 


(b)           Voluntary Increases.  Following the Closing Date, the Revolving
Committed Amount may be increased to an aggregate amount of up to
$75,000,000.00 if (i) the Borrower requests such increase in writing to the
Agent, (ii) BAS is able to syndicate the amount of such increase (A) to one or
more financial institutions qualifying as an Eligible Assignee and (B) in a
manner otherwise in accordance with the terms and conditions set forth in the
Syndication Letter, (iii) such increase does not increase the amount of the
Revolving Commitment of any Lender without the written consent of such Lender,
(iv) the Borrower executes new promissory notes reflecting the increase in the
Revolving Committed Amount and executes such other amendments to the Credit
Documents as are deemed necessary by the Agent, (v) no Default or Event of
Default exists at such time and (vi) the Borrower pays all fees required by the
Fee Letter in connection with such increase in the Revolving Committed Amount
and all costs and expenses incurred by the Agent in documenting or implementing
such increase.  All of the terms and
conditions of the Credit Documents shall apply to the increased amount of the
Revolving Committed Amount as if such amount were in effect as of the date
hereof.  Each Lender that may be a party
hereto from time to time hereby acknowledges that the Revolving Committed
Amount may be increased pursuant to this Section 3.4(b) regardless of whether
such Lender approves such increase or increases its Revolving Commitment
hereunder; provided, that BAS hereby agrees to offer to each existing Lender,
on terms and conditions similar to those being offered to other prospective
lenders, a portion of any increase in the Revolving Committed Amount equal to
such Lender’s Revolving Commitment Percentage immediately prior to such
increase (to the extent such Lender is not, at such time, a Defaulting Lender).  Notwithstanding anything to the contrary
contained herein, the Borrower may request an increase in the Revolving
Committed Amount no more than once during the term of this Agreement.


 


(c)           Maturity Date.  Unless terminated sooner pursuant to
Section 3.4(a) or Section 9.2, the Revolving Commitments of the
Lenders and the LOC Commitment of the Issuing Lender shall automatically
terminate on the Maturity Date.


 


(d)           General.  The Agent will promptly notify the Lenders
of (i) any such notice of termination or reduction of the Revolving Committed
Amount and (ii) any requested increase in the Revolving Committed Amount.  Any reduction of the Revolving Committed
Amount shall be applied to the Revolving Commitment of each Lender according to
its Revolving Commitment Percentage. 
All fees


 


38

















 


accrued until the effective date of any
termination of all or a portion of the Revolving Committed Amount shall be paid
by Borrower on the effective date of such termination.


 


3.5          Fees.


 


(a)           Unused Fee.  In consideration of the Revolving
Commitments of the Lenders hereunder, the Borrower promises to pay to the Agent
for the account of each Lender a fee (the “Unused Fee”) on the Unused
Revolving Committed Amount computed at a per annum rate for each day during the
applicable Unused Fee Calculation Period (hereinafter defined) equal to three
and three-quarters tenths of one percent (0.375%).  The Unused Fee shall commence to accrue on
the Closing Date and shall be due and payable in arrears on the last Business
Day of each March, June, September and December (and on any date that
the Revolving Committed Amount is reduced and on the Maturity Date) for the
immediately preceding quarter (or portion thereof) (each such quarter or
portion thereof for which the Unused Fee is payable hereunder being herein
referred to as an “Unused Fee Calculation Period”), beginning with the
first of such dates to occur after the Closing Date.


 


(b)           Letter
of Credit Fee.  In consideration of
the issuance of Letters of Credit hereunder, the Borrower promises to pay to
the Agent for the account of each Lender a fee (the “Letter of Credit Fee”)
on such Lender’s Commitment Percentage of the average daily maximum amount
available to be drawn under each such Letter of Credit (whether or not such
maximum amount is then in effect under such Letter of Credit) computed at a per
annum rate for each day from the date of issuance to the date of expiration
equal to three percent (3.00%).  The
Letter of Credit Fee will be payable quarterly in arrears on the first Business
Day of each calendar quarter for the immediately preceding calendar
quarter (or portion thereof).


 


(c)           Issuing
Lender Fees.  In addition to the
Letter of Credit Fee payable pursuant to clause (b) above, the Borrower
promises to pay to the Issuing Lender for its own account without sharing by
the other Lenders (i) a fee equal to the greater of (A) twelve and one half one
hundredths of one percent (0.125%) and (B) $1,500.00 on each Letter of
Credit issued by the Issuing Lender (such fee to be due upon issuance of such
Letter of Credit and, provided, that to the extent the applicable Letter of
Credit contains “evergreen” provisions, the Borrower shall pay such fee for
each renewal of such Letter of Credit) and (ii) customary charges from time to
time of the Issuing Lender with respect to the issuance, amendment, transfer,
administration, cancellation and conversion of, and drawings under, such
Letters of Credit (collectively, the “Issuing Lender Fees”).


 


(d)           Derivative
Exposure Usage Fee.  In
consideration of the exposure of the Lenders hereunder created by amounts
reserved as a portion of the Derivative Exposure Reserve, the Borrower promises
to pay to the Agent for the account of each Lender a fee (the “Derivative
Exposure Usage Fee”) on the amount of Availability reserved pursuant to
Section 2.3 hereof as a portion of the Derivative Exposure Reserve for
each day during a given Derivative Exposure Fee Period (as defined below).  Such fee shall be computed at a per annum
rate equal to three percent (3.00%) applied to the amount of Availability
reserved on each day of the applicable Derivative Exposure Fee Period (with the
total fee for a given Derivative Exposure Fee Period equaling the sum of each
such day’s calculation).  The Derivative
Exposure Usage Fee shall, to the extent any Availability is reserved under
Section 2.3 as of the Closing Date, commence to accrue on the Closing Date
and shall be due and payable in arrears on the last Business Day of each March,
June, September and December (and on the Maturity Date) for the
immediately preceding quarter (or portion thereof, as applicable), beginning
with the first of such dates to occur after the Closing Date (each such quarter
or portion thereof for which the Derivative Exposure Reserve Fee is payable
hereunder being herein referred to as an “Derivative Exposure Fee Period”).


 


(e)           Other
Fees.  Borrower shall pay to the
Agent and BAS the fees required pursuant to the terms of the Fee Letter.


 


3.6          Capital Adequacy.


 


If any Lender has determined, after the date hereof, that the adoption
or the becoming effective of, or any change in, or any change by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof in the interpretation or
administration of, any applicable law, rule or regulation regarding capital
adequacy, or compliance by such Lender with any request or directive regarding
capital adequacy


 


39

















 


(whether or not having the force of law) of any such authority, central
bank or comparable agency, has or would have the effect of reducing the rate of
return on such Lender’s capital or assets as a consequence of its commitments
or obligations hereunder to a level below that which such Lender could have
achieved but for such adoption, effectiveness, change or compliance (taking
into consideration such Lender’s policies with respect to capital adequacy),
then, upon notice from such Lender to the Borrower, the Borrower shall be
obligated to pay to such Lender such additional amount or amounts as will
compensate such Lender for such reduction (without duplication of any amount
received by Lender by virtue of the definition of the term “Eurodollar Reserve
Requirement”).  Each determination by
any such Lender of amounts owing under this Section shall, absent manifest
error, be conclusive and binding on the parties hereto.


 


3.7          Limitation on Eurodollar Loans.


 


If on or prior to the first day of any Interest Period for any
Eurodollar Loan:


 


(a)           the Agent determines (which
determination shall be conclusive) that by reason of circumstances affecting
the relevant market, adequate and reasonable means do not exist for
ascertaining the Eurodollar Rate for such Interest Period; or


 


(b)           the Required Lenders determine (which
determination shall be conclusive) and notify the Agent that the Eurodollar
Rate will not adequately and fairly reflect the cost to the Lenders of funding
Eurodollar Loans for such Interest Period;


 


then the Agent shall give the Borrower prompt notice thereof, and so
long as such condition remains in effect, the Lenders shall be under no
obligation to make additional Eurodollar Loans, Continue Eurodollar Loans, or
to Convert Base Rate Loans into Eurodollar Loans and the Borrower shall, on the
last day(s) of the then current Interest Period(s) for the outstanding
Eurodollar Loans, either prepay such Eurodollar Loans or Convert such
Eurodollar Loans into Base Rate Loans in accordance with the terms of this
Credit Agreement.


 


3.8          Illegality.


 


Notwithstanding any other provision of this Credit Agreement, in the
event that it becomes unlawful for any Lender or its Applicable Lending Office
to make, maintain, or fund Eurodollar Loans hereunder, then such Lender shall
promptly notify the Borrower thereof and such Lender’s obligation to make or
Continue Eurodollar Loans and to Convert Base Rate Loans into Eurodollar Loans
shall be suspended until such time as such Lender may again make, maintain, and
fund Eurodollar Loans (in which case the provisions of Section 3.10 shall
be applicable).


 


3.9          Requirements of Law.


 


If, after the date hereof, the adoption of any applicable law, rule, or
regulation, or any change in any applicable law, rule, or regulation, or any
change in the interpretation or administration thereof by any Governmental
Authority, central bank, or comparable agency charged with the interpretation
or administration thereof, or compliance by any Lender (or its Applicable
Lending Office) with any request or directive (whether or not having the force
of law) of any such Governmental Authority, central bank, or comparable agency:


 


(i)            shall subject such Lender (or its
Applicable Lending Office) to any tax, duty, or other charge with respect to
any Eurodollar Loans, its Notes, or its obligation to make Eurodollar Loans, or
change the basis of taxation of any amounts payable to such Lender (or its
Applicable Lending Office) under this Credit Agreement or its Notes in respect
of any Eurodollar Loans (other than taxes imposed on the overall net income of
such Lender by the jurisdiction in which such Lender has its principal office
or such Applicable Lending Office);


 


(ii)           shall impose, modify, or deem
applicable any reserve, special deposit, assessment, or similar requirement
(other than the Eurodollar Reserve Requirement utilized in the determination of
the Adjusted Eurodollar Rate) relating to any extensions of credit or other
assets of, or any deposits with or other liabilities or commitments of, such
Lender (or its Applicable Lending Office), including the Commitment of such
Lender hereunder; or


 


40

















 


(iii)          shall impose on such Lender (or its
Applicable Lending Office) or the London interbank market any other condition
affecting this Credit Agreement or its Notes or any of such extensions of
credit or liabilities or commitments;


 


and the result of any of the foregoing is to
increase the cost to such Lender (or its Applicable Lending Office) of making,
Converting into, Continuing, or maintaining any Eurodollar Loans or to reduce
any sum received or receivable by such Lender (or its Applicable Lending
Office) under this Credit Agreement or its Notes with respect to any Eurodollar
Loans, then the Borrower shall pay to such Lender on demand such amount or
amounts as will compensate such Lender for such increased cost or
reduction.  If any Lender requests
compensation by the Borrower under this Section 3.9, the Borrower may, by
notice to such Lender (with a copy to the Agent), suspend the obligation of
such Lender to make or Continue Eurodollar Loans, or to Convert Base Rate Loans
into Eurodollar Loans, until the event or condition giving rise to such request
ceases to be in effect (in which case the provisions of Section 3.10 shall
be applicable); provided that such suspension shall not affect the right
of such Lender to receive the compensation so requested.  Each Lender shall promptly notify the
Borrower and the Agent of any event of which it has knowledge, occurring after
the date hereof, which will entitle such Lender to compensation pursuant to
this Section 3.9 and will designate a different Applicable Lending Office
if such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the judgment of such Lender, be otherwise
disadvantageous to it.  Any Lender
claiming compensation under this Section 3.9 shall furnish to the Borrower
and the Agent a statement setting forth the additional amount or amounts to be
paid to it hereunder which shall be conclusive in the absence of manifest
error.  In determining such amount, such
Lender may use any reasonable averaging and attribution methods.


 


3.10        Treatment of Affected Loans.


 


If the obligation of any Lender to make any Eurodollar Loan or to
Continue, or to Convert Base Rate Loans into, Eurodollar Loans shall be
suspended pursuant to Section 3.7, 3.8 or 3.9 hereof, such Lender’s
Eurodollar Loans shall be automatically Converted into Base Rate Loans on the
last day(s) of the then current Interest Period(s) for such Eurodollar Loans
(or, in the case of a Conversion, on such earlier date as such Lender may
specify to the Borrower with a copy to the Agent) and, unless and until such
Lender gives notice as provided below that the circumstances specified in
Section 3.7, 3.8 or 3.9 hereof that gave rise to such Conversion no longer
exist:


 


(a)           to the extent that such Lender’s
Eurodollar Loans have been so Converted, all payments and prepayments of
principal that would otherwise be applied to such Lender’s Eurodollar Loans
shall be applied instead to its Base Rate Loans; and


 


(b)           all Loans that would otherwise be
made or Continued by such Lender as Eurodollar Loans shall be made or Continued
instead as Base Rate Loans, and all Base Rate Loans of such Lender that would
otherwise be Converted into Eurodollar Loans shall remain as Base Rate Loans.


 


If such Lender gives notice to the Borrower (with a copy to the Agent)
that the circumstances specified in Section 3.7, 3.8 or 3.9 hereof that
gave rise to the Conversion of such Lender’s Eurodollar Loans pursuant to this
Section 3.10 no longer exist (which such Lender agrees to do promptly upon
such circumstances ceasing to exist) at a time when Eurodollar Loans made by
other Lenders are outstanding, such Lender’s Base Rate Loans shall be
automatically Converted, on the first day(s) of the next succeeding Interest
Period(s) for such outstanding Eurodollar Loans, to the extent necessary so
that, after giving effect thereto, all Loans held by the Lenders holding
Eurodollar Loans and by such Lender are held pro rata (as to principal amounts,
interest rate basis, and Interest Periods) in accordance with their respective
Commitments.


 


3.11        Taxes.


 


(a)           Any and all payments by any Credit
Party to or for the account of any Lender or the Agent hereunder or under any
other Credit Document shall be made free and clear of and without deduction for
any and all present or future taxes, duties, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto, excluding,
in the case of each Lender and the Agent, taxes imposed on its income, and
franchise taxes imposed on it by the jurisdiction under the laws of which such
Lender (or its Applicable Lending Office) or the Agent (as the case may be) is
organized or any political subdivision thereof (all such non-excluded taxes,
duties, levies, imposts, deductions, charges, withholdings, and liabilities
being hereinafter


 


41

















 


referred to as “Taxes”).  If any Credit Party shall be required by law
to deduct any Taxes from or in respect of any sum payable under this Credit
Agreement or any other Credit Document to any Lender or the Agent, (i) the
sum payable shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this
Section 3.11) such Lender or the Agent receives an amount equal to the sum
it would have received had no such deductions been made, (ii) such Credit
Party shall make such deductions, (iii) such Credit Party shall pay the
full amount deducted to the relevant taxation authority or other authority in
accordance with applicable law, and (iv) such Credit Party shall furnish
to the Agent, at its address referred to in Section 11.1, the original or
a certified copy of a receipt evidencing payment thereof.


 


(b)           In addition, the Borrower agrees to
pay any and all present or future stamp or documentary taxes and any other
excise or property taxes or charges or similar levies which arise from any
payment made under this Credit Agreement or any other Credit Document or from
the execution or delivery of, or otherwise with respect to, this Credit
Agreement or any other Credit Document (hereinafter referred to as “Other
Taxes”).


 


(c)           The Borrower agrees to indemnify each
Lender and the Agent for the full amount of Taxes and Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed or asserted by any
jurisdiction on amounts payable under this Section 3.11) paid by such
Lender or the Agent (as the case may be) and any liability (including
penalties, interest, and expenses) arising therefrom or with respect thereto.


 


(d)           Each Lender that is not a United
States person under Section 7701(a)(30) of the Code, on or prior to the
date of its execution and delivery of this Credit Agreement in the case of each
Lender listed on the signature pages hereof and on or prior to the date on
which it becomes a Lender in the case of each other Lender (such Lender
constituting a “Foreign Lender”), and from time to time thereafter if
requested in writing by the Borrower or the Agent (but only so long as such
Lender remains lawfully able to do so), shall provide the Borrower and the
Agent with (i) Internal Revenue Service Form W-8 BEN or W-8 ECI, as
appropriate, or any successor form prescribed by the Internal Revenue Service,
certifying that such Lender is entitled to benefits under an income tax treaty
to which the United States is a party which reduces to zero the rate of
withholding tax on payments of interest or certifying that the income
receivable pursuant to this Credit Agreement is effectively connected with the
conduct of a trade or business in the United States, (ii) Internal Revenue
Service Form W-8 or W-9, as appropriate, or any successor form prescribed
by the Internal Revenue Service, and/or (iii) any other form or
certificate required by any taxing authority (including any certificate
required by Sections 871(h) and 881(c) of the Internal Revenue Code),
certifying that such Lender is entitled to an exemption from tax on payments
pursuant to this Credit Agreement or any of the other Credit Documents.


 


(e)           For any period with respect to which
a Lender has failed to provide the Borrower and the Agent with the appropriate
form pursuant to Section 3.11(d) (unless such failure is due to a change
in treaty, law, or regulation occurring subsequent to the date on which a form
originally was required to be provided), such Lender shall not be entitled to
indemnification under Section 3.11(a) or 3.11(b) with respect to Taxes
imposed by the United States; provided, however, that should a
Lender, which is otherwise exempt from withholding tax, become subject to Taxes
because of its failure to deliver a form required hereunder, the Borrower shall
take such steps as such Lender shall reasonably request to assist such Lender
to recover such Taxes.


 


(f)            If any Credit Party is required to
pay additional amounts to or for the account of any Lender pursuant to this
Section 3.11, then such Lender will agree to use reasonable efforts to
change the jurisdiction of its Applicable Lending Office so as to eliminate or
reduce any such additional payment which may thereafter accrue if such change,
in the judgment of such Lender, is not otherwise disadvantageous to such
Lender.


 


(g)           Without prejudice to the survival of
any other agreement of the Credit Parties hereunder, the agreements and
obligations of the Credit Parties contained in this Section 3.11 shall
survive the repayment of the Loans, LOC Obligations and other obligations under
the Credit Documents and the termination of the Commitments hereunder.


 


42

















 


3.12        Compensation.


 


Upon the request of any Lender, the Borrower shall pay to such Lender
such amount or amounts as shall be sufficient (in the reasonable opinion of
such Lender) to compensate it for any loss, cost, or expense (excluding loss of
anticipated profits) incurred by it as a result of:


 


(a)           any payment, prepayment, or
Conversion of a Eurodollar Loan for any reason (including, without limitation,
the acceleration of the Loans pursuant to Section 9.2) on a date other
than the last day of the Interest Period for such Loan; or


 


(b)           any failure by the Borrower for any
reason (including, without limitation, the failure of any condition precedent
specified in Section 5 to be satisfied) to borrow, Convert, Continue, or
prepay a Eurodollar Loan on the date for such borrowing, Conversion,
Continuation, or prepayment specified in the relevant notice of borrowing,
prepayment, Continuation, or Conversion under this Credit Agreement.


 


With respect to Eurodollar Loans, such indemnification may include an
amount equal to the excess, if any, of (a) the amount of interest which
would have accrued on the amount so prepaid, or not so borrowed, Converted or
Continued, for the period from the date of such prepayment or of such failure
to borrow, Convert or Continue to the last day of the applicable Interest
Period (or, in the case of a failure to borrow, Convert or Continue, the
Interest Period that would have commenced on the date of such failure) in each
case at the applicable rate of interest for such Eurodollar Loans provided for
herein over (b) the amount of interest (as reasonably determined by such
Lender) which would have accrued to such Lender on such amount by placing such
amount on deposit for a comparable period with leading banks in the interbank
Eurodollar market.  The covenants of the
Borrower set forth in this Section 3.12 shall survive the repayment of the
Loans, LOC Obligations and other obligations under the Credit Documents and the
termination of the Commitments hereunder.


 


3.13        Pro Rata Treatment.


 


Except to the extent otherwise provided herein and subject to the terms
of the Intercreditor Agreement:


 


(a)           Loans.  Each Loan, each payment or (subject to the
terms of Section 3.3) prepayment of principal of any Loan or reimbursement
obligations arising from drawings under Letters of Credit, each payment of
interest on the Loans or reimbursement obligations arising from drawings under
Letters of Credit, each payment of the Letter of Credit Fee, each reduction of
the Revolving Committed Amount and each conversion or extension of any Loan,
shall be allocated pro rata among the Lenders in accordance with the respective
principal amounts of their outstanding Loans of the applicable type and
Participation Interests in Loans of the applicable type and Letters of Credit.


 


(b)           Advances.  No Lender shall be responsible for the
failure or delay by any other Lender in its obligation to make its ratable
share of a borrowing hereunder; provided, however, that the
failure of any Lender to fulfill its obligations hereunder shall not relieve
any other Lender of its obligations hereunder. 
Unless the Agent shall have been notified by any Lender prior to the
date of any requested borrowing that such Lender does not intend to make
available to the Agent its ratable share of such borrowing to be made on such
date, the Agent may assume that such Lender has made such amount available to
the Agent on the date of such borrowing, and the Agent in reliance upon such
assumption, may (in its sole discretion but without any obligation to do so)
make available to the Borrower a corresponding amount.  If such corresponding amount is not in fact
made available to the Agent, the Agent shall be able to recover such
corresponding amount from such Lender. 
If such Lender does not pay such corresponding amount forthwith upon the
Agent’s demand therefor, the Agent will promptly notify the Borrower, and the
Borrower shall immediately pay such corresponding amount to the Agent.  The Agent shall also be entitled to recover
from the Lender or the Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Agent to the Borrower to the date such
corresponding amount is recovered by the Agent at a per annum rate equal to
(i) from the Borrower at the applicable rate for the applicable borrowing
pursuant to the Notice of Borrowing and (ii) from a Lender at the Federal
Funds Rate.


 


43

















 


3.14        Sharing of Payments.


 


The Lenders agree among themselves that, in the event that any Lender
shall obtain payment in respect of any Loan, LOC Obligation or any other
obligation owing to such Lender under this Credit Agreement through the
exercise of a right of setoff, banker’s lien or counterclaim, or pursuant to a
secured claim under Section 506 of Title 11 of the United States Code
or other security or interest arising from, or in lieu of, such secured claim,
received by such Lender under any applicable bankruptcy, insolvency or other
similar law or otherwise, or by any other means, in excess of its pro rata
share of such payment as provided for in this Credit Agreement, such Lender
(and the other Lenders) shall adhere to the provisions of the Intercreditor
Agreement with respect to such payment and any rescission or restoration
thereof.  The Borrower agrees that any Lender
purchasing such a Participation Interest hereunder as a result of any such
payments may, to the fullest extent permitted by law, exercise all rights of
payment, including setoff, banker’s lien or counterclaim, with respect to such
Participation Interest as fully as if such Lender were a holder of such Loan,
LOC Obligation or other obligation in the amount of such Participation
Interest.  Except as otherwise expressly
provided in this Credit Agreement, if any Lender shall fail to remit to the
Collateral Agent, Agent or any other Lender an amount payable by such Lender to
the Agent or such other Lender pursuant to this Credit Agreement on the date
when such amount is due, such payments shall be made by such Lender together
with interest thereon for each date from the date such amount is due until the
date such amount is paid to the Collateral Agent, Agent or such other Lender at
a rate per annum equal to the Federal Funds Rate.  If under any applicable bankruptcy, insolvency or other similar
law, any Lender receives a secured claim in lieu of a setoff to which this
Section 3.14 applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent
with the rights of the Lenders under this Section 3.14 and the Secured
Parties under the Credit Agreement to share in the benefits of any recovery on
such secured claim.


 


3.15        Payments, Computations, Etc.


 


(a)           Generally. Notwithstanding
anything to the contrary contained herein, all payments made by any Credit
Party hereunder shall be paid to the Collateral Agent for allocation in
accordance with the Intercreditor Agreement. Except as otherwise specifically
provided herein, all payments hereunder shall be made to the Collateral Agent
(for the benefit of the Agent and Lenders) in Dollars in immediately available
funds, without setoff, deduction, counterclaim or withholding of any kind, at
the Collateral Agent’s office specified in the Intercreditor Agreement not
later than 2:00 P.M. (Charlotte, North Carolina time) on the date when
due.  Payments received after such time
shall be deemed to have been received on the next succeeding Business Day.    The Agent may (but shall not be obligated
to) debit the amount of any such payment which is not made by such time to any
ordinary deposit account of the Borrower or any other Credit Party maintained
with the Agent (with notice to the Borrower or such other Credit Party). The
Agent shall distribute payments received from the Collateral Agent under the
Intercreditor Agreement in accordance with the terms of the Intercreditor
Agreement.  The Agent will distribute
such payments to the Lenders entitled thereto, if any such payment is received
prior to 2:00 P.M.  (Charlotte,
North Carolina time) on a Business Day in like funds as received prior to the
end of such Business Day and otherwise the Agent will distribute such payment
to such Lenders on the next succeeding Business Day.  Whenever any payment hereunder shall be stated to be due on a day
which is not a Business Day, the due date thereof shall be extended to the next
succeeding Business Day (subject to accrual of interest and Fees for the period
of such extension), except that in the case of Eurodollar Loans, if the
extension would cause the payment to be made in the next following calendar
month, then such payment shall instead be made on the next preceding Business
Day.  Except as expressly provided
otherwise herein, all computations of interest and fees shall be made on the
basis of actual number of days elapsed over a year of 360 days.  Interest shall accrue from and include the
date of borrowing, but exclude the date of payment.


 


(b)           Allocation of Payments After Event
of Default. After the occurrence and during the continuance of an Event of
Default, all amounts collected or received by the Agent or any Lender on
account of the Credit Party Obligations shall continue to be paid to the
Collateral Agent and all payments received by Agent from the Collateral Agent
during such periods shall continue to be paid over or delivered in accordance
with the Intercreditor Agreement; provided that, if the Intercreditor
Agreement has been terminated, such amounts shall be applied by the Agent in
the following order:


 


44

















 


FIRST, to the
payment of all reasonable out-of-pocket costs and expenses (including without
limitation reasonable attorneys’ fees) of the Agent in connection with
enforcing the rights of the Lenders under the Credit Documents;


 


SECOND, to
payment of any fees owed to the Agent;


 


THIRD, to the
payment of all of the Credit Party Obligations consisting of accrued fees and
interest;


 


FOURTH, to the
payment of the outstanding principal amount of the Credit Party Obligations
(including the payment or cash collateralization of the outstanding LOC
Obligations and Derivative Exposure Reserves);


 


FIFTH, to the
payment of all reasonable out-of-pocket costs and expenses (including without
limitation, reasonable attorneys’ fees) of each of the Lenders in connection
with enforcing its rights under the Credit Documents or otherwise with respect
to the Credit Party Obligations owing to such Lender;


 


SIXTH, to all
other Credit Party Obligations and other obligations which shall have become
due and payable under the Credit Documents or otherwise and not repaid pursuant
to clauses ”FIRST” through “FIFTH” above; and


 


SEVENTH, to
the payment of the surplus, if any, to whomever may be lawfully entitled to
receive such surplus.


 


In carrying out the foregoing, amounts
received shall be applied in the numerical order provided until exhausted prior
to application to the next succeeding category.  In allocating payments received from the Collateral Agent (or, in
the event the Intercreditor Agreement is terminated, the Credit Parties), the
Agent shall pay to each of the Lenders an amount equal to such Lender’s pro
rata share of the total amount of the applicable obligations with respect to
which such payment is made.


 


3.16        Evidence of Debt.


 


(a)           Each Lender shall maintain an account
or accounts evidencing each Loan made by such Lender to the Borrower from time
to time, including the amounts of principal and interest payable and paid to
such Lender from time to time under this Credit Agreement.  Each Lender will make reasonable efforts to
maintain the accuracy of its account or accounts and to promptly update its
account or accounts from time to time, as necessary.


 


(b)           The Agent shall maintain the Register
pursuant to Section 11.3(c), and a subaccount for each Lender, in which
Register and subaccounts (taken together) shall be recorded (i) the amount,
type and Interest Period of each such Loan hereunder, (ii) the amount of
any principal or interest due and payable or to become due and payable to each
Lender hereunder and (iii) the amount of any sum received by the Agent
hereunder from or for the account of any Credit Party and each Lender’s share
thereof.  The Agent will make reasonable
efforts to maintain the accuracy of the subaccounts referred to in the
preceding sentence and to promptly update such subaccounts from time to time,
as necessary.


 


(c)           The entries made in the accounts,
Register and subaccounts maintained pursuant to clause (b) of this
Section 3.16 (and, if consistent with the entries of the Agent,
clause (a)) shall be prima facie evidence of the existence and amounts of the
obligations of the Credit Parties therein recorded; provided, however,
that the failure of any Lender or the Agent to maintain any such account, such
Register or such subaccount, as applicable, or any error therein, shall not in
any manner affect the obligation of the Credit Parties to repay the Credit
Party Obligations owing to such Lender.


 


45

















 


3.17        Usury.


 


In no event shall the amount of interest due
or payable on the Loans or other obligations evidenced hereby or under the
other Credit Documents exceed the maximum rate of interest allowed by
Applicable Law and, if any such payment is paid by the Borrower or received by
any Lender Party, then such excess sum shall be credited as a payment of
principal, unless the Borrower shall notify the respective Lender Party in
writing that the Borrower elects to have such excess sum returned to it
forthwith.  It is the express intent of
the parties hereto that the Borrower not pay and the Lender Parties not
receive, directly or indirectly, in any manner whatsoever, interest in excess
of that which may be lawfully paid by the Borrower under Applicable Law.


 


3.18        Agreement Regarding Interest
and Charges.


 


The parties hereto hereby agree and stipulate
that the only charge imposed upon the Borrower for the use of money in
connection with this Credit Agreement is and shall be the interest specifically
described in Section 2.1(d). 
Notwithstanding the foregoing, the parties hereto further agree and
stipulate that all agency fees, syndication fees, facility fees, letter of
credit fees, underwriting fees, default charges, late charges, funding or
“breakage” charges, increased cost charges, attorneys’ fees and reimbursement
for costs and expenses paid by the Agent or any Lender Party to third parties
or for damages incurred by the Agent or any Lender Party, are charges made to
compensate the Agent or any such Lender Party for underwriting or
administrative services and costs or losses performed or incurred, and to be
performed or incurred, by the Agent and the Lender Parties in connection with
this Credit Agreement and shall under no circumstances be deemed to be charges
for the use of money.  Except as
expressly agreed otherwise in writing, all charges other than charges for the
use of money shall be fully earned and nonrefundable when due.


 


3.19        Statements of Account.


 


The Agent will account to the Borrower
monthly with a statement of Loans, Letter of Credit, accrued interest and Fees,
charges and payments made pursuant to this Credit Agreement and the other
Credit Documents, and such account rendered by the Agent shall be prima facie
evidence of the amounts and other matters set forth therein.  The failure of the Agent to deliver such a
statement of accounts shall not relieve or discharge the Borrower from any of
its obligations hereunder.


 


3.20        Defaulting Lenders.


 


(a)           Generally.  If for any reason any Lender Party at any
time becomes a Defaulting Lender, then, in addition to the rights and remedies
that may be available to the Agent or the Borrower under this Credit Agreement
or Applicable Law, such Defaulting Lender’s right to participate in the
administration of the Loans, this Credit Agreement and the other Credit
Documents, including without limitation, any right to vote in respect of, to
consent to or to direct any action or inaction of the Agent or to be taken into
account in the calculation of the Required Lenders or the Required Revolving
Lenders, shall be suspended during the pendency of such failure or refusal.  Upon a Lender Party becoming a Defaulting
Lender, the Agent shall give prompt notice to each other Lender thereof.  If a Lender Party is a Defaulting Lender
because it has failed to make timely payment to the Agent of any amount required
to be paid to the Agent hereunder (without giving effect to any notice or cure
periods), in addition to other rights and remedies which the Agent or the
Borrower may have under the immediately preceding provisions or otherwise, the
Agent shall be entitled (i) to collect interest from such Defaulting Lender on
such delinquent payment for the period from the date on which the payment was
due until the date on which the payment is made at the Federal Funds Rate, (ii)
to withhold or setoff and to apply in satisfaction of the defaulted payment and
any related interest, any amounts otherwise payable to such Defaulting Lender
under this Credit Agreement or any other Credit Document and (iii) to bring an
action or suit against such Defaulting Lender in a court of competent
jurisdiction to recover the defaulted amount and any related interest.  Any amounts received by the Agent in respect
of a Defaulting Lender’s Loans shall not be paid to such Defaulting Lender and
shall be held uninvested by the Agent and either applied against the purchase
price of such Loans under the following subsection (b) or paid to such
Defaulting Lender upon the Defaulting Lender’s curing of its default.


 


(b)           Purchase
of Defaulting Lender’s Commitment. 
Any Lender Party who is not a Defaulting Lender shall have the right,
but not the obligation, in its sole discretion, to acquire all of a Defaulting
Lender’s Revolving


 


46

















 


Commitment. 
Any Lender Party desiring to exercise such right shall give written
notice thereof to the Agent no sooner than two (2) Business Days and not
later than ten (10) Business Days after such Defaulting Lender became a
Defaulting Lender.  If more than one
Lender Party exercises such right, each such Lender Party shall have the right
to acquire an amount of such Defaulting Lender’s Revolving Commitment in
proportion to the Revolving Commitments of the other Lender Parties exercising
such right.  If after such 10th Business
Day, the Lender Parties have not elected to purchase all of the Revolving
Commitment of such Defaulting Lender, then any Eligible Assignee may purchase
such Revolving Commitment.  None of the
Agent, the Sole Lead Arranger or any of the Lender Parties shall have any
obligation whatsoever to initiate any such replacement or to assist in finding
an Eligible Assignee.  Upon any such
purchase, the Defaulting Lender’s interest in the Loans and its rights
hereunder (but not its liability in respect thereof or under the Credit
Documents or this Credit Agreement to the extent the same relate to the period
prior to the effective date of the purchase) shall terminate on the date of
purchase, and the Defaulting Lender shall promptly execute all documents
reasonably requested to surrender and transfer such interest to the purchaser
thereof, including an appropriate Assignment and Assumption Agreement and,
notwithstanding Section 11.3, shall pay to the Agent an assignment fee in
the amount of $5,000.  The purchase
price for the Revolving Commitment of a Defaulting Lender shall be equal to the
amount of the principal balance of the Loans outstanding and owed by the
Borrower to the Defaulting Lender. 
Prior to payment of such purchase price to a Defaulting Lender, the
Agent shall apply against such purchase price any amounts retained by the Agent
pursuant to the last sentence of the immediately preceding
subsection (a).  The Defaulting
Lender shall be entitled to receive amounts owed to it by the Borrower under
the Credit Documents which accrued prior to the date of the default by the
Defaulting Lender, to the extent the same are received by the Agent from or on
behalf of the Borrower.  There shall be
no recourse against any Lender Party or the Agent for the payment of such sums
except to the extent of the receipt of payments from any other party or in
respect of the Loans.  If, prior to a
Lender Party’s acquisition of a Defaulting Lender’s Revolving Commitment
pursuant to this subsection, such Defaulting Lender shall cure the event or
condition which caused it to become a Defaulting Lender and shall have paid all
amounts owing by it hereunder as a result thereof, then such Lender Party shall
no longer have the right to acquire such Defaulting Lender’s Revolving
Commitment.


 


3.21        Assumptions Concerning
Funding of Eurodollar Loans.


 


Calculation of all amounts payable to a
Lender Party under this Article III shall be made as though such Lender
Party had actually funded Eurodollar Loans through the purchase of deposits in
the relevant market bearing interest at the rate applicable to such Eurodollar
Loans in an amount equal to the amount of the Eurodollar Loans and having a
maturity comparable to the relevant Interest Period; provided, however,
that each Lender Party may fund each of its Eurodollar Loans in any manner it
sees fit and the foregoing assumption shall be used only for calculation of
amounts payable under this Article III.


 


3.22        Release of HCI.


 


Notwithstanding anything contained herein to
the contrary, the Agent shall release HCI as a Borrower and Credit Party
hereunder and under each of the Credit Documents, (a) upon receipt by the Agent
of a request for release of HCI from the Borrower and all supporting
documentation, materials and information required by Agent in connection
therewith; (b) upon receipt by Agent of evidence (satisfactory to Agent in its reasonable
discretion) that all Property owned by HCI has been transferred to JV1, that
HCI has been or will be, immediately upon receipt of an acknowledgement of
release by Agent, merged into JV1 or otherwise dissolved in a manner acceptable
to the Agent, in its reasonable discretion and that the entities that were
formerly Wholly Owned Subsidiaries of HCI are or will be, immediately upon
receipt of an acknowledgement of release by Agent, Wholly Owned Subsidiaries of
JV1 and Credit Parties hereunder and (c) to the extent no Default or Event of
Default exists as of the date of such requested release or is otherwise likely
to occur as a result of the granting of such release.  Upon satisfaction of the above-noted conditions, Agent shall
deliver to Borrower written confirmation of the release of HCI as a Borrower
and Credit Party hereunder and under the other Credit Documents.  All references contained herein to HCI and
all portions of any representations, warranties and covenants contained in any
Credit Document and directly related to HCI or its ownership structure (but not
portions of such representation, warranties and covenants related, in any
manner, to any other Credit Party or Person) shall, immediately upon the
delivery by Agent to the Borrower of the written confirmation of release
pursuant to this Section 3.22, be deemed to be deleted from such Credit
Documents and to be of no further force or effect; provided, however, that
Borrower’s delivery of a request for release with respect to HCI shall be deemed
to be an ongoing representation, warranty and covenant that HCI has been or
will be,


 


47

















 


immediately upon the receipt of Agent’s
confirmation of release, merged into JV1 or otherwise dissolved in the manner
shown in the materials and information provided to Agent in connection
therewith and an ongoing representation and warranty that such materials and
information are true and correct in all material respects.  Each of the Lenders hereby consents to the
release of HCI upon the terms and conditions set forth in this Section 3.22.


 


ARTICLE IV


 


GUARANTY


 


4.1          The
Guaranty.


 


Each of the Guarantors hereby jointly and severally guarantees to each
Lender, each Affiliate of a Lender that enters into a Hedging Agreement, and
the Agent as hereinafter provided, as primary obligor and not as surety, the
prompt payment of the Credit Party Obligations in full when due (whether at
stated maturity, as a mandatory prepayment, by acceleration, as a mandatory
cash collateralization or otherwise) strictly in accordance with the terms
thereof.  The Guarantors hereby further
agree that if any of the Credit Party Obligations are not paid in full when due
(whether at stated maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise), the Guarantors will, jointly
and severally, promptly pay the same, without any demand or notice whatsoever,
and that in the case of any extension of time of payment or renewal of any of
the Credit Party Obligations, the same will be promptly paid in full when due
(whether at extended maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise) in accordance with the terms of
such extension or renewal.


 


Notwithstanding any provision to the contrary contained herein or in
any other of the Credit Documents or Hedging Agreements, the obligations of
each Guarantor under this Credit Agreement and the other Credit Documents shall
be limited to an aggregate amount equal to the largest amount that would not
render such obligations subject to avoidance under Section 548 of the
Bankruptcy Code or any comparable provisions of any applicable state law.


 


4.2          Obligations Unconditional.


 


The obligations of the Guarantors under Section 4.1 are joint and
several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Credit Documents or
Hedging Agreements, or any other agreement or instrument referred to therein,
or any substitution, release, impairment or exchange of any other guarantee of
or security for any of the Credit Party Obligations, and, to the fullest extent
permitted by applicable law, irrespective of any other circumstance whatsoever
which might otherwise constitute a legal or equitable discharge or defense of a
surety or guarantor, it being the intent of this Section 4.2 that the
obligations of the Guarantors hereunder shall be absolute and unconditional
under any and all circumstances.  Each
Guarantor agrees that such Guarantor shall have no right of subrogation,
indemnity, reimbursement or contribution against the Borrower or any other
Guarantor for amounts paid under this Section 4 until such time as the
Credit Party Obligations have been Fully Satisfied.  Without limiting the generality of the foregoing, it is agreed
that, to the fullest extent permitted by law, the occurrence of any one or more
of the following shall not alter or impair the liability of any Guarantor
hereunder which shall remain absolute and unconditional as described above:


 


(a)           at any time or from time to time,
without notice to any Guarantor, the time for any performance of or compliance
with any of the Credit Party Obligations shall be extended, or such performance
or compliance shall be waived;


 


(b)           any of the acts mentioned in any of
the provisions of any of the Credit Documents, any Hedging Agreement between
any Consolidated Party and any Lender, or any Affiliate of a Lender, or any
other agreement or instrument referred to in the Credit Documents or such
Hedging Agreements shall be done or omitted;


 


(c)           the maturity of any of the Credit
Party Obligations shall be accelerated, or any of the Credit Party Obligations
shall be modified, supplemented or amended in any respect, or any right under
any of the Credit Documents, any Hedging Agreement between any Consolidated
Party and any Lender, or any Affiliate of a Lender, or any other agreement or
instrument referred to in the Credit Documents or such Hedging


 


48

















 


Agreements shall be waived or any other
guarantee of any of the Credit Party Obligations or any security therefor shall
be released, impaired or exchanged in whole or in part or otherwise dealt with;


 


(d)           any Lien granted to, or in favor of,
the Agent or any Lender or Lenders as security for any of the Credit Party
Obligations shall fail to attach or be perfected; or


 


(e)           any of the Credit Party Obligations
shall be determined to be void or voidable (including, without limitation, for
the benefit of any creditor of any Guarantor) or shall be subordinated to the
claims of any Person (including, without limitation, any creditor of any
Guarantor).


 


With respect to its obligations hereunder, each Guarantor hereby
expressly waives diligence, presentment, demand of payment, protest and all
notices whatsoever, and any requirement that the Agent or any Lender exhaust
any right, power or remedy or proceed against any Person under any of the
Credit Documents, any Hedging Agreement between any Consolidated Party and any
Lender, or any Affiliate of a Lender, or any other agreement or instrument
referred to in the Credit Documents or such Hedging Agreements, or against any
other Person under any other guarantee of, or security for, any of the Credit
Party Obligations.


 


4.3          Reinstatement.


 


The obligations of the Guarantors under this Section 4 shall be
automatically reinstated if and to the extent that for any reason any payment
by or on behalf of any Person in respect of the Credit Party Obligations is rescinded
or must be otherwise restored by any holder of any of the Credit Party
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Agent and each Lender on demand for all reasonable costs and expenses
(including, without limitation, fees and expenses of counsel) incurred by the
Agent or such Lender in connection with such rescission or restoration,
including any such costs and expenses incurred in defending against any claim
alleging that such payment constituted a preference, fraudulent transfer or
similar payment under any bankruptcy, insolvency or similar law.


 


4.4          Certain Additional Waivers.


 


Without limiting the generality of the provisions of this Section 4,
each Guarantor hereby specifically waives the benefits of N.C.  Gen. 
Stat.  §§ 26-7 through 26-9,
inclusive, to the extent applicable. 
Each Guarantor further agrees that such Guarantor shall have no right of
recourse to security for the Credit Party Obligations, except through the
exercise of rights of subrogation pursuant to Section 4.2 and through the
exercise of rights of contribution pursuant to Section 4.6.


 


4.5          Remedies.


 


The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Agent and the Lenders, on the
other hand, the Credit Party Obligations may be declared to be forthwith due
and payable as provided in Section 9.2 (and shall be deemed to have become
automatically due and payable in the circumstances provided in said
Section 9.2) for purposes of Section 4.1 notwithstanding any stay,
injunction or other prohibition preventing such declaration (or preventing the
Credit Party Obligations from becoming automatically due and payable) as
against any other Person and that, in the event of such declaration (or the
Credit Party Obligations being deemed to have become automatically due and
payable), the Credit Party Obligations (whether or not due and payable by any
other Person) shall forthwith become due and payable by the Guarantors for
purposes of Section 4.1.


 


4.6          Rights of Contribution.


 


The Guarantors hereby agree as among themselves that, if any Guarantor
shall make an Excess Payment (as defined below), such Guarantor shall have a
right of contribution from each other Guarantor in an amount equal to such
other Guarantor’s Contribution Share (as defined below) of such Excess
Payment.  The payment obligations of any
Guarantor under this Section 4.6 shall be subordinate and subject in right
of payment to the Credit Party Obligations until such time as the Credit Party
Obligations have been Fully Satisfied, and none of the Guarantors shall
exercise any right or remedy under this Section 4.6 against any other
Guarantor until such Credit Party Obligations have been Fully Satisfied.  For purposes of this Section 4.6,
(a) ”Excess Payment” shall mean the amount paid by any Guarantor in


 


49

















 


excess of its Pro Rata Share of any Guaranteed Obligations; (b) ”Pro
Rata Share” shall mean, for any Guarantor in respect of any payment of
Credit Party Obligations, the ratio (expressed as a percentage) as of the date
of such payment of Guaranteed Obligations of (i) the amount by which the
aggregate present fair salable value of all of its assets and properties
exceeds the amount of all debts and liabilities of such Guarantor (including
contingent, subordinated, unmatured, and unliquidated liabilities, but
excluding the obligations of such Guarantor hereunder) to (ii) the amount
by which the aggregate present fair salable value of all assets and other
properties of all of the Credit Parties exceeds the amount of all of the debts
and liabilities (including contingent, subordinated, unmatured, and unliquidated
liabilities, but excluding the Credit Party Obligations) of the Credit Parties;
provided, however, that, for purposes of calculating the Pro Rata
Shares of the Guarantors in respect of any payment of Credit Party Obligations,
any Guarantor that became a Guarantor subsequent to the date of any such
payment shall be deemed to have been a Guarantor on the date of such payment
and the financial information for such Guarantor as of the date such Guarantor
became a Guarantor shall be utilized for such Guarantor in connection with such
payment; and (c) ”Contribution Share” shall mean, for any Guarantor
in respect of any Excess Payment made by any other Guarantor, the ratio
(expressed as a percentage) as of the date of such Excess Payment of
(i) the amount by which the aggregate present fair salable value of all of
its assets and properties exceeds the amount of all debts and liabilities of
such Guarantor (including contingent, subordinated, unmatured, and unliquidated
liabilities, but excluding the obligations of such Guarantor hereunder) to
(ii) the amount by which the aggregate present fair salable value of all
assets and other properties of the Credit Parties other than the maker of such
Excess Payment exceeds the amount of all of the debts and liabilities (including
contingent, subordinated, unmatured, and unliquidated liabilities, but
excluding the Credit Party Obligations) of the Credit Parties other than the
maker of such Excess Payment; provided, however, that, for
purposes of calculating the Contribution Shares of the Guarantors in respect of
any Excess Payment, any Guarantor that became a Guarantor subsequent to the
date of any such Excess Payment shall be deemed to have been a Guarantor on the
date of such Excess Payment and the financial information for such Guarantor as
of the date such Guarantor became a Guarantor shall be utilized for such
Guarantor in connection with such Excess Payment.  This Section 4.6 shall not be deemed to affect any right of
subrogation, indemnity, reimbursement or contribution that any Guarantor may
have under applicable law against the Borrower in respect of any payment of
Guaranteed Obligations.  Notwithstanding
the foregoing, all rights of contribution against any Guarantor shall terminate
from and after such time, if ever, that such Guarantor shall be relieved of its
obligations pursuant to Section 8.5(a).


 


4.7          Guarantee of Payment; Continuing Guarantee.


 


The guarantee in this Section 4 is a guaranty of payment and not
of collection, is a continuing guarantee, and shall apply to all Credit Party
Obligations whenever arising.


 


 


ARTICLE V


 


CONDITIONS


 


 


5.1          Closing Conditions.


 


The
obligation of the Lenders to enter into this Credit Agreement and to make the
initial Loans or reserve amounts under the Derivative Exposure Reserve or the
Issuing Lender to issue the initial Letter of Credit, whichever shall occur
first, shall be subject to satisfaction of the following conditions (in form
and substance acceptable to the Agent):


 


(a)           Executed Credit Documents.  Receipt by the Agent of duly executed copies
of:  (i) this Credit Agreement,
(ii) the Notes, (iii) the Security Documents; (iv) the Intercreditor
Agreement and (v) all other Credit Documents.


 


(b)           Corporate Documents.  Receipt by the Agent of the following:


 


(i)            Charter Documents.  Copies of the articles or certificates of
incorporation or other charter documents of each Credit Party certified to be
true and complete as of a recent date by the


 


50

















 


appropriate Governmental Authority of the state
or other jurisdiction of its incorporation and certified by a secretary or
assistant secretary of such Credit Party to be true and correct as of the
Closing Date.


 


(ii)           Bylaws.  A copy of the bylaws of each Credit Party
certified by a secretary or assistant secretary of such Credit Party to be true
and correct as of the Closing Date.


 


(iii)          Resolutions.  Copies of resolutions of the Board of
Directors of each Credit Party approving and adopting the Credit Documents to
which it is a party, the transactions contemplated therein and authorizing
execution and delivery thereof, certified by a secretary or assistant secretary
of such Credit Party to be true and correct and in force and effect as of the
Closing Date.


 


(iv)          Good Standing.  Copies of (A) certificates of good
standing, existence or its equivalent with respect to each Credit Party
certified as of a recent date by the appropriate Governmental Authorities of
the state or other jurisdiction of incorporation and each other jurisdiction in
which the failure to so qualify and be in good standing could have a Material
Adverse Effect and (B) to the extent available, a certificate indicating
payment of all corporate or comparable franchise taxes certified as of a recent
date by the appropriate governmental taxing authorities.


 


(v)           Incumbency.  An incumbency certificate of each Credit
Party certified by a secretary or assistant secretary to be true and correct as
of the Closing Date.


 


(vi)          REIT Status.  Evidence, satisfactory to the Agent, that
the USRP REIT qualifies as a REIT, that each of its Subsidiaries that are
corporations are Qualified REIT Subsidiaries and that the execution and
performance by the Credit Parties under the Credit Documents shall not affect
such status.


 


(vii)         Bankruptcy Remote Borrowing Entity
Status.  Evidence, satisfactory to
the Agent, that the General SPE qualifies as a Bankruptcy Remote Borrowing
Entity and that the execution and performance by the Credit Parties under the
Credit Documents shall not affect such status.


 


(c)           Opinions of Counsel.  The Agent shall have received, in each case
dated as of the Closing Date and in form and substance reasonably satisfactory
to the Agent:


 


(i)            a legal opinion of Richard Wilensky,
general counsel for the Credit Parties; and


 


(ii)           a legal opinion of special local
counsel for each Credit Party not organized in the State of Delaware.


 


(d)           Officer’s Certificates.  The Agent shall have received a certificate
or certificates executed by an Executive Officer of the Borrower as of the
Closing Date, in form and substance satisfactory to the Agent, stating that
(A) each Credit Party is in compliance with all existing financial
obligations, (B) all governmental, shareholder and third party consents
and approvals, if any, with respect to the Credit Documents and the
transactions contemplated thereby have been obtained, (C) no action, suit,
investigation or proceeding is pending or threatened in any court or before any
arbitrator or governmental instrumentality that purports to affect any Credit
Party or any transaction contemplated by the Credit Documents, if such action,
suit, investigation or proceeding could have a Material Adverse Effect, and
(D) immediately after giving effect to the Transaction, (1) no
Default or Event of Default exists, (2) all representations and warranties
contained herein and in the other Credit Documents are true and correct in all
material respects and (3) on the basis of income statement items and
capital expenditures for the 12-month period ending on the last day of the most
recently ended calendar month prior to the Closing Date and balance sheet items
as of the Closing Date after giving effect to the Credit Documents, the Credit
Parties are in pro forma compliance with each of the Financial Covenants.


 


51

















 


(e)           Solvency Certificate.  The Agent shall have received a certificate
executed by an Executive Officer of the Borrower as of the Closing Date, in
form and substance satisfactory to the Agent, regarding the Solvency of each of
the Credit Parties.


 


(f)            Fees and Expenses.  Payment by the Credit Parties to the Lenders
and the Agent of all fees and expenses relating to the Credit Facility which
are due and payable on the Closing Date, including, without limitation, the
payment by Borrower to the Agent and BAS those fees specified in the Fee Letter
and all fees and expenses of Moore & Van Allen, PLLC whether reflected on
previously issued invoices or an invoice to be delivered at closing.


 


(g)           Current and Pro Forma Financial
Statements.  Receipt by the Agent
and the Lenders of (i) the consolidated financial statements of the
Consolidated Parties, including balance sheets and income and cash flow
statements for the fiscal quarter ended September 30, 2003; (ii) pro forma
covenant calculations with respect to each of the Financial Covenants, showing
compliance with such covenants as of the Closing Date; (iii) detailed
projections of financial statements for the Consolidated Parties and of
calculations with respect to each of the Financial Covenants, in each case, for
the three year period following the most recently completed fiscal quarter of
the Consolidated Parties; and (iv) such other information relating to the
Consolidated Parties as the Agent may reasonably require.


 


(h)           Opening
Borrowing Base Certificate and Delinquency Report.  Receipt by the Agent of a Borrowing Base
Certificate containing the Borrower’s most recently collected information with
respect to the Borrowing Base Assets (but, in any event, with respect to
information that is not more than 45 days old as of the Closing Date),
substantially in the form of Exhibit 7.1(d) and certified by an
Executive Officer of the Borrower to be true and correct and a Delinquency
Report dated as of the Closing Date and certified by an Executive Officer of
the Borrower to be true and correct as of the Closing Date.  


 


(i)            Evidence
of Termination. Evidence, acceptable to the Agent in its reasonable
discretion, indicating that the Replaced Credit Agreement has been terminated
as of the Closing Date.


 


(j)            Other.  Receipt by the Lenders of such other
documents, instruments, agreements or information as reasonably requested by
any Lender, including, but not limited to, information regarding litigation,
tax, accounting, labor, insurance, pension liabilities (actual or contingent),
real estate leases, material contracts, debt agreements, property ownership and
contingent liabilities of the Consolidated Parties.


 


5.2          Conditions
to all Extensions of Credit.


 


The obligations of each Lender to make, convert or extend any Loan and
of the Issuing Lender to issue or extend any Letter of Credit (including the
initial Loans and the initial Letter of Credit) are subject to satisfaction of
the following conditions in addition to satisfaction on the Closing Date of the
conditions set forth in Section 5.1:


 


(a)           The Borrower shall have delivered
(i) in the case of any Loan, an appropriate Notice of Borrowing, Notice
of  Continuation or Notice of Conversion
or (ii) in the case of any Letter of Credit, the Issuing Lender shall have
received an appropriate request for issuance in accordance with the provisions
of Section 2.2(b);


 


(b)           The representations and warranties
set forth in Section 6 shall, subject to the limitations set forth
therein, be true and correct in all material respects as of such date (except
for those which expressly relate to an earlier date);


 


(c)           There shall not have been commenced
against any Consolidated Party an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or any
case, proceeding or other action for the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of such Person
or for any substantial part of its Property or for the winding up or
liquidation of its affairs, and such involuntary case or other case, proceeding
or other action shall remain undismissed;


 


52

















 


(d)           No Default or Event of Default shall
exist and be continuing either prior to or after giving effect thereto; and


 


(e)           Immediately after giving effect to
the making of such Loan (and the application of the proceeds thereof), the
establishment of a Derivative Exposure Reserve or to the issuance of such
Letter of Credit, as the case may be, (i) the sum of the aggregate
outstanding principal amount of Revolving Loans plus LOC Obligations plus
the Aggregate Derivative Exposure Amount shall not exceed the Revolving
Committed Amount, (ii) the sum of the aggregate outstanding principal amount of
Revolving Loans plus LOC Obligations plus the Aggregate
Derivative Exposure Amount, plus the then-outstanding Term Loan
Obligations shall not exceed the Borrowing Base, (iii) the LOC Obligations
shall not exceed the LOC Committed Amount and (iv) the Aggregate Derivative
Exposure Amount shall not exceed Reserve Limit.


 


The delivery of each Notice of Borrowing and each request for a Letter
of Credit pursuant to Section 2.2(b) shall constitute a representation and
warranty by the Credit Parties of the correctness of the matters specified in
subsections (b), (c), (d) and (e) above.


 


 


ARTICLE VI


 


REPRESENTATIONS AND WARRANTIES


 


The Credit Parties hereby represent to the Agent and each Lender that:


 


6.1          Financial Condition.


 


(a)           The audited consolidated balance
sheets and income statements of the Consolidated Parties for the fiscal years
ended December 31, 1999, December 31, 2000, December 31,
2001 and December 31, 2002 (including the notes thereto) (i) have been
audited by Deloitte & Touche, (ii) have been prepared in accordance
with GAAP consistently applied throughout the periods covered thereby and
(iii) present fairly (on the basis disclosed in the footnotes to such
financial statements) the consolidated financial condition, results of
operations and cash flows of the Consolidated Parties as of such date and for
such periods.  The unaudited interim
balance sheets of the Consolidated Parties as at the end of, and the related
unaudited interim statements of earnings and of cash flows for, each fiscal
month and quarterly period ended after December 31, 2002 and prior to
the Closing Date (i) have been prepared in accordance with GAAP
consistently applied throughout the periods covered thereby and
(ii) present fairly (on the basis disclosed in the footnotes to such
financial statements) the consolidated financial condition, results of
operations and cash flows of the Consolidated Parties as of such date and for
such periods.  During the period from
December 31, 2002 to and including the Closing Date, there has been no sale,
transfer or other disposition by any Consolidated Party of any material part of
the business or property of the Consolidated Parties, taken as a whole, and no
purchase or other acquisition by any of them of any business or property
(including any Capital Stock of any other Person) material in relation to the
consolidated financial condition of the Consolidated Parties, taken as a whole,
in each case, which is not reflected in the foregoing financial statements or
in the notes thereto and has not otherwise been disclosed in writing to the
Lenders on or prior to the Closing Date. 
As of the Closing Date, the Borrower and its Subsidiaries have no
material liabilities (contingent or otherwise) that are not reflected in the
foregoing financial statements or in the notes thereto.


 


(b)           The financial statements and other
information delivered pursuant to Section 5.1(g) have been prepared in
accordance with GAAP (except as may otherwise be permitted under
Section 1.3) and present fairly (on the basis disclosed in the footnotes
to such financial statements) the consolidated financial condition, results of
operations and cash flows of the General Partner and the Consolidated Parties
as of such date and for such periods.


 


6.2          No
Material Change.


 


Since December 31, 2002, there has been no development or event
relating to or affecting a Consolidated Party which has had or could have a
Material Adverse Effect.


 


53

















 


6.3          Organization and Good Standing.


 


Each of the Consolidated Parties (a) is duly organized, validly
existing and is in good standing under the laws of the jurisdiction of its
incorporation or organization, (b) has the corporate or other necessary
power and authority, and the legal right, to own and operate its property, to
lease the property it operates as lessee and to conduct the business in which
it is currently engaged and (c) is duly qualified as a foreign entity and
in good standing under the laws of each jurisdiction where its ownership, lease
or operation of property or the conduct of its business requires such
qualification, other than in such jurisdictions where the failure to be so
qualified and in good standing would not have a Material Adverse Effect.


 


6.4          Power; Authorization; Enforceable Obligations.


 


Each of the Credit Parties has the corporate or other necessary power
and authority, and the legal right, to make, deliver and perform the Credit
Documents to which it is a party, and in the case of the Borrower, to obtain
extensions of credit hereunder, and has taken all necessary corporate or other
necessary action to authorize the borrowings and other extensions of credit on
the terms and conditions of this Credit Agreement and to authorize the
execution, delivery and performance of the Credit Documents to which it is a
party.  No consent or authorization of,
filing with, notice to or other similar act by or in respect of, any
Governmental Authority or any other Person is required to be obtained or made
by or on behalf of any Credit Party in connection with the borrowings or other
extensions of credit hereunder or with the execution, delivery, performance,
validity or enforceability of the Credit Documents to which such Credit Party
is a party, except for consents, authorizations, notices and filings
described in Schedule 6.4, all of which have been obtained or made
or have the status described in such Schedule 6.4.  This Credit Agreement has been, and each
other Credit Document to which any Credit Party is a party will be, duly
executed and delivered on behalf of the Credit Parties.  This Credit Agreement constitutes, and each
other Credit Document to which any Credit Party is a party when executed and
delivered will constitute, a legal, valid and binding obligation of such Credit
Party enforceable against such party in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).


 


6.5          No
Conflicts.


 


Neither the execution and delivery of the Credit Documents, nor the
consummation of the transactions contemplated therein, nor performance of and
compliance with the terms and provisions thereof by such Credit Party will
(a) violate or conflict with any provision of its articles or certificate
of incorporation or bylaws or other organizational or governing documents of
such Person, (b) violate, contravene or materially conflict with any
Requirement of Law or any other law, regulation (including, without limitation,
Regulation U or Regulation X), order, writ, judgment, injunction,
decree or permit applicable to it, (c) violate, contravene or conflict
with contractual provisions of, or cause an event of default under, any
indenture, loan agreement, mortgage, deed of trust, contract or other agreement
or instrument to which it is a party or by which it may be bound, the violation
of which could have a Material Adverse Effect, or (d) result in or require
the creation of any Lien (other than those contemplated in or created in
connection with the Credit Documents) upon or with respect to its properties.


 


6.6          No Default.


 


No Consolidated Party is in default in any respect under any contract,
lease, loan agreement, indenture, mortgage, security agreement or other
agreement or obligation to which it is a party or by which any of its
properties is bound which default could have a Material Adverse Effect.  No Default or Event of Default has occurred
or exists except as previously disclosed in writing to the Lenders.


 


6.7          Ownership.


 


Each Consolidated Party is the owner of, and has good and marketable
title to, all of its respective assets and none of such assets is subject to
any Lien other than Permitted Liens and Liens granted in connection with any
Term Securitization specifically contemplated and approved pursuant to the
terms hereof.


 


54

















 


6.8          Indebtedness.


 


Except as otherwise permitted under Section 8.1, the Consolidated
Parties have no Indebtedness.


 


6.9          Litigation.


 


Except as disclosed in Schedule 6.9, there does not exist
any pending or threatened action, suit or legal, equitable, arbitration or
administrative proceeding against any Consolidated Party which might have a
Material Adverse Effect.


 


6.10        Taxes.


 


Each Consolidated Party has filed, or caused to be filed, all material
tax returns (Federal, state, local and foreign) required to be filed and paid
(a) all amounts of taxes shown thereon to be due (including interest and
penalties) and (b) all other taxes, fees, assessments and other
governmental charges (including mortgage recording taxes, documentary stamp
taxes and intangibles taxes) owing by it, except for such taxes (i) which
are not yet delinquent or (ii) that are being contested in good faith and
by proper proceedings, and against which adequate reserves are being maintained
in accordance with GAAP.  No Credit
Party is aware of any proposed federal or state income tax assessments against
it or any other Consolidated Party.  No
Credit Party is aware of any other proposed tax assessments against it or any
other Consolidated Party that could have a Material Adverse Effect.


 


6.11        Compliance with Law.


 


Each Consolidated Party is in compliance with all Requirements of Law
and all other laws, rules, regulations, orders and decrees (including without
limitation Environmental Laws) applicable to it, or to its properties, unless
such failure to comply could not have a Material Adverse Effect.  No currently-existing Requirement of Law
could cause a Material Adverse Effect.


 


6.12        ERISA.


 


Except as disclosed and described in Schedule 6.12 attached
hereto:


 


(a)           During the five-year period prior to
the date on which this representation is made or deemed made: (i) no ERISA
Event has occurred, and, to the best knowledge of the Executive Officers of the
Credit Parties, no event or condition has occurred or exists as a result of
which any ERISA Event could reasonably be expected to occur, with respect to
any Plan; (ii) no “accumulated funding deficiency,” as such term is
defined in Section 302 of ERISA and Section 412 of the Code, whether
or not waived, has occurred with respect to any Plan; (iii) each Plan has
been maintained, operated, and funded in compliance with its own terms and in
material compliance with the provisions of ERISA, the Code, and any other
applicable Federal or state laws; and (iv) no lien in favor of the PBGC or
a Plan has arisen or is reasonably likely to arise on account of any Plan.


 


(b)           The actuarial present value of all
“benefit liabilities” (as defined in Section 4001(a)(16) of ERISA),
whether or not vested, under each Single Employer Plan, as of the last annual
valuation date prior to the date on which this representation is made or deemed
made (determined, in each case, in accordance with Financial Accounting
Standards Board Statement 87, utilizing the actuarial assumptions used in such
Plan’s most recent actuarial valuation report), did not exceed as of such
valuation date the fair market value of the assets of such Plan.


 


(c)           Neither any Consolidated Party nor
any ERISA Affiliate has incurred, or, to the best knowledge of the Executive
Officers of the Credit Parties, could be reasonably expected to incur, any
withdrawal liability under ERISA to any Multiemployer Plan or Multiple Employer
Plan.  Neither any Consolidated Party
nor any ERISA Affiliate would become subject to any withdrawal liability under
ERISA if any Consolidated Party or any ERISA Affiliate were to withdraw
completely from all Multiemployer Plans and Multiple Employer Plans as of the
valuation date most closely preceding the date on which this representation is
made or deemed made.  Neither any Consolidated
Party nor any ERISA Affiliate has received any notification that any
Multiemployer Plan is in reorganization (within the meaning of
Section 4241 of ERISA),


 


55

















 


is insolvent (within the meaning of
Section 4245 of ERISA), or has been terminated (within the meaning of
Title IV of ERISA), and no Multiemployer Plan is, to the best knowledge of
the Executive Officers of the Credit Parties, reasonably expected to be in
reorganization, insolvent, or terminated.


 


(d)           No prohibited transaction (within the
meaning of Section 406 of ERISA or Section 4975 of the Code) or
breach of fiduciary responsibility has occurred with respect to a Plan which
has subjected or may subject any Consolidated Party or any ERISA Affiliate to
any liability under Sections 406, 409, 502(i), or 502(l) of ERISA or
Section 4975 of the Code, or under any agreement or other instrument
pursuant to which any Consolidated Party or any ERISA Affiliate has agreed or
is required to indemnify any Person against any such liability.


 


(e)           Neither any Consolidated Party nor
any ERISA Affiliates has any material liability with respect to “expected
post-retirement benefit obligations” within the meaning of the Financial
Accounting Standards Board Statement 106. 
Each Plan which is a welfare plan (as defined in Section 3(1) of
ERISA) to which Sections 601-609 of ERISA and Section 4980B of the
Code apply has been administered in compliance in all material respects of such
sections.


 


(f)            Neither the execution and delivery
of this Credit Agreement nor the consummation of the financing transactions
contemplated thereunder will involve any transaction which is subject to the
prohibitions of Sections 404, 406 or 407 of ERISA or in connection with
which a tax could be imposed pursuant to Section 4975 of the Code.  The representation by the Credit Parties in
the preceding sentence is made in reliance upon and subject to the accuracy of
the Lenders’ representation in Section 11.15 with respect to their source
of funds and is subject, in the event that the source of the funds used by the
Lenders in connection with this transaction is an insurance company’s general
asset account, to the application of Prohibited Transaction Class Exemption
95-60, 60 Fed.  Reg.  35,925 (1995), compliance with the
regulations issued under Section 401(c)(1)(A) of ERISA, or the issuance of
any other prohibited transaction exemption or similar relief, to the effect
that assets in an insurance company’s general asset account do not constitute
assets of an “employee benefit plan” within the meaning of Section 3(3) of
ERISA or a “plan” within the meaning of Section 4975(e)(1) of the Code.


 


6.13        Corporate Structure; Capital Stock, etc.


 


The corporate capital and ownership structure of the Consolidated
Parties as of the Closing Date after giving effect to the Credit Documents
executed as of the date hereof is as described in Schedule 6.13A.  Set forth on Schedule 6.13B is a
complete and accurate list as of the Closing Date with respect to the Borrower
and each of its direct and indirect Subsidiaries of (i) jurisdiction of
incorporation, (ii) number of shares of each class of Capital Stock
outstanding, (iii) number and percentage of outstanding shares of each
class owned (directly or indirectly) by the Consolidated Parties and
(iv) number and effect, if exercised, of all outstanding options,
warrants, rights of conversion or purchase and all other similar rights with
respect thereto as of the Closing Date (except for employee stock options
required to be disclosed in regularly-filed publicly accessible
documents).  The outstanding Capital
Stock of all such Persons is validly issued, fully paid and non-assessable and
is owned by the Consolidated Parties, directly or indirectly, in the manner set
forth on Schedule 6.13B, free and clear of all Liens (other than
those arising under or contemplated in connection with the Credit
Documents).  Other than as set forth in Schedule 6.13B,
neither the Borrower nor any of its Subsidiaries has outstanding any securities
convertible into or exchangeable for its Capital Stock nor does any such Person
have outstanding any rights to subscribe for or to purchase or any options for
the purchase of, or any agreements providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating to
its Capital Stock. Each of the Domestic Subsidiaries of the General Partner,
the USRP REIT and the Borrower existing as of the date hereof, except USRP
Funding 2001-A, L.P., USRP (SFGP), LLC, USRP (Hawaii), LLC, USRP (Bob), LLC and
Fuel Supply, Inc. are listed as Subsidiary Guarantors on the signature pages
hereto.  S&C has no Subsidiaries and
owns no Capital Stock of any other Person. HCI has no Subsidiaries that are not
Credit Parties and owns no Capital Stock of any other Person. JV1 has no
Subsidiaries that are not Credit Parties and each Subsidiary of JV1 is set
forth on Schedule 6.13A attached hereto.


 


56

















 


6.14        Governmental Regulations, Etc.


 


(a)           None of the transactions contemplated
by this Credit Agreement (including, without limitation, the direct or indirect
use of the proceeds of the Loans) will violate or result in a violation of the
Securities Act, the Securities Exchange Act or any of Regulations U and X.  If requested by any Lender or the Agent, the
Borrower will furnish to the Agent and each Lender a statement, in conformity
with the requirements of FR Form U-1 referred to in Regulation U,
that no part of the Letters of Credit or proceeds of the Loans will be used,
directly or indirectly, for the purpose of “buying” or “carrying” any “margin
stock” within the meaning of Regulations U and X, or for the purpose of
purchasing or carrying or trading in any securities.


 


(b)           None of the Consolidated Parties is
(i) an “investment company”, or a company “controlled” by “investment
company”, within the meaning of the Investment Company Act of 1940, as amended,
(ii) a “holding company” as defined in, or otherwise subject to regulation
under, the Public Utility Holding Company Act of 1935, as amended or
(iii) subject to regulation under any other Federal or state statute or
regulation which limits its ability to incur Indebtedness.


 


6.15        Purpose of Loans, Letters of Credit and Derivative
Exposure Reserve; Termination of Replaced Credit Agreement.


 


The proceeds of the Loans hereunder shall be used by the Borrower
solely (a) to refinance one hundred percent (100.0%) of the Indebtedness under
the Replaced Credit Agreement; and (b) to provide for working capital and
general corporate purposes of the Borrower and its Subsidiaries.  The Letters of Credit shall be used only for
or in connection with appeal bonds, reimbursement obligations arising in
connection with surety and reclamation bonds, reinsurance, domestic or
international trade transactions and obligations not otherwise aforementioned
relating to transactions entered into by the applicable account party in the
ordinary course of business.  Proceeds
paid with respect to the Derivative Exposure Reserve shall be used only in
connection with the Borrower’s exposure under BOA Derivative Instruments.  No proceeds of the Loans shall be used to
(y) finance the purchase of “margin stock” as such term is defined in
Regulation U of the Federal Reserve Board or (z) finance the acquisition
of any investments in commercial mortgage-backed securities.  The Replaced Credit Agreement has been or
shall be terminated as of the date hereof.


 


6.16        Environmental Matters.


 


Except as disclosed and described in Schedule 6.16 attached
hereto:


 


(a)           Each of the Real Properties and all
operations at the Real Properties are in material compliance with all
applicable Environmental Laws, there is no violation of any Environmental Law
with respect to the Real Properties or the Businesses, and there are no
conditions relating to the Real Properties or the Businesses that could give
rise to liability under any applicable Environmental Laws that could result in
a Material Adverse Effect.


 


(b)           None of the Real Properties contains,
or has previously contained, any Materials of Environmental Concern at, on or
under the Real Properties in amounts or concentrations that could result in a
Material Adverse Effect.


 


(c)           No Consolidated Party has received
any written or verbal notice of, or inquiry from any Governmental Authority
regarding, any violation, alleged violation, non-compliance, liability or
potential liability regarding environmental matters or compliance with
Environmental Laws with regard to any of the Real Properties or the Businesses
that could result in a Material Adverse Effect, nor does any Executive Officer
of any Credit Party have knowledge or reason to believe that any such notice
will be received or is being threatened.


 


(d)           Materials of Environmental Concern
have not been transported or disposed of from the Real Properties, or
generated, treated, stored or disposed of at, on or under any of the Real
Properties or any other location, in each case by or on behalf of any
Consolidated Party in a manner that could result in a Material Adverse Effect.


 


57

















 


(e)           No judicial proceeding or
governmental or administrative action is pending or, to the best knowledge of
the Executive Officers of the Credit Parties, threatened, under any
Environmental Law to which any Consolidated Party is or will be named as a
party, nor are there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or judicial
requirements outstanding under any Environmental Law with respect to the Consolidated
Parties, the Real Properties or the Businesses that could result in a Material
Adverse Effect.


 


(f)            There has been no release, or threat
of release, of Materials of Environmental Concern at or from any of the Real
Properties, or arising from or related to the operations (including, without
limitation, disposal) of any Consolidated Party in connection with the Real
Properties or otherwise in connection with the Businesses in a manner that
could result in a Material Adverse Effect.


 


6.17        Intellectual Property.


 


Each Consolidated Party owns, or has the legal right to use, all
trademarks, tradenames, copyrights, technology, know-how and processes (the “Intellectual
Property”) necessary for each of them to conduct its business as currently
conducted except for those the failure to own or have such legal right to use
could not have a Material Adverse Effect.


 


6.18        Solvency.


 


Each Credit Party is and, after consummation of the transactions
contemplated by the Credit Documents, will be Solvent.


 


6.19        Investments.


 


All Investments of each Consolidated Party are Permitted Investments.


 


6.20        Principal Offices.


 


Set forth on Schedule 6.20 is the chief executive office
and principal place of business of each Credit Party.  Schedule 6.20 may be updated from time to time by the
Borrowers by giving written notice thereof to the Agent.


 


6.21        Disclosure.


 


Neither this Credit Agreement nor any financial statements delivered to
the Lenders nor any other document, certificate or statement furnished to the
Lenders by or on behalf of any Consolidated Party in connection with the
transactions contemplated hereby contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the
statements contained therein or herein not misleading.


 


6.22        No
Burdensome Restrictions.


 


No Consolidated Party is a party to any agreement or instrument or
subject to any other obligation or any charter or corporate restriction or any
provision of any applicable law, rule or regulation which, individually or in
the aggregate, could have a Material Adverse Effect.


 


6.23        Brokers’ Fees.


 


No Consolidated Party has any obligation to any Person in respect of
any finder’s, broker’s, investment banking or other similar fee in connection
with any of the transactions contemplated under the Credit Documents.


 


6.24        Labor
Matters.


 


There are no collective bargaining agreements or Multiemployer Plans
covering the employees of a Consolidated Party as of the Closing Date and none
of the Consolidated Parties has suffered any strikes, walkouts, work stoppages
or other material labor difficulty within the last five years.


 


58

















 


6.25        Nature of Business.


 


As of the Closing Date, the Consolidated Parties are engaged in the
business of acquiring, owning, operating, managing and developing restaurant,
service station, other service retail properties and several miscellaneous
properties (including billboard properties, one office building and one fuel
terminal facility).


 


6.26        REIT Status.


 


The USRP REIT is qualified as a REIT and each of its Subsidiaries that
is a corporation is a Qualified REIT Subsidiary.  Each of the Subsidiaries of the USRP REIT set forth on Schedule
6.26 is a taxable REIT subsidiary, as such term is used in the Code.  The USRP REIT has no Subsidiaries that are
taxable REIT subsidiaries except those set forth on Schedule 6.26.


 


6.27        Bankruptcy
Remote Borrowing Entity.


 


Each of S&C, HCI and each of its Wholly Owned Subsidiaries, JV1 and
each of its Wholly Owned Subsidiaries and the General SPE is a Bankruptcy
Remote Borrowing Entity.  USRP Operating
owns 99% of the Capital Stock of the General SPE.  USRP Holding owns 100% of the Capital Stock of S&C.  JV1 holds 100% of the Capital Stock of
HCI.  USRP Operating owns 100% of the
Capital Stock of JV1.


 


6.28        Closing
Date Borrowing Base Assets.


 


Schedule 6.28 sets
forth each of the Borrowing Base Assets as of the Closing Date.  Each asset listed on Schedule 6.28
fully qualifies as a Borrowing Base Asset and, collectively, the assets listed
thereon qualify to be included in the Borrowing Base.


 


6.29        Tax
Shelter Regulations.


 


The Borrower
does not intend to treat the Loans and/or Letters of Credit and related
transactions as being a “reportable transaction” (within the meaning of Treasury
Regulation section 1.6011-4). If the Borrower determines to take any action
inconsistent with such intention, it will promptly notify the Agent
thereof.  The Borrower acknowledges that
the Agent and/or one or more of the Lenders may treat the Loans and/or Letters
of Credit as part of a transaction that is subject to Treasury Regulation
section 1.6011-4 or section 301.6112-1, and the Agent and such Lender or
Lenders, as applicable, may file such IRS forms or maintain such lists and
other records as they may determine is required by such Treasury Regulations.


 


6.30        Representations
and Warranties Under Term Loan Documents.


 


All of the representations and warranties of the Borrower and the other
“Credit Parties” as defined in the Term Loan Agreement and the other Term Loan
Documents are true and correct in all material respects (except to the extent
the same have been waived in accordance with the terms thereof).


 


 


ARTICLE VII


 


AFFIRMATIVE COVENANTS


 


Each Credit Party hereby covenants and agrees that, so long as this
Credit Agreement is in effect or any amounts payable hereunder or under any
other Credit Document shall remain outstanding or any Letter of Credit is
outstanding, and until all of the Commitments hereunder shall have terminated:


 


7.1          Information Covenants.


 


The Credit Parties will furnish, or cause to be furnished, to the Agent
and each of the Lenders:


 


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(a)           Annual Financial Statements.  As soon as available, and in any event
within 90 days after the close of each fiscal year of the Consolidated Parties,
a consolidated balance sheet and income statement of the Consolidated Parties
as of the end of such fiscal year, together with related consolidated
statements of retained earnings and cash flows for such fiscal year (along with
a summary of amount of all Asset Dispositions and Equity Issuances that were
made during the prior fiscal year), in each case setting forth in comparative
form consolidated figures for the preceding fiscal year, all such financial
information described above to be in reasonable form and detail and audited by
independent certified public accountants of recognized national standing
reasonably acceptable to the Agent and whose opinion shall be to the effect
that such financial statements have been prepared in accordance with GAAP
(except for changes with which such accountants concur) and shall not be
limited as to the scope of the audit or qualified as to the status of the
Consolidated Parties as a going concern or any other material qualifications or
exceptions.


 


(b)           Quarterly Financial Statements.  As soon as available, and in any event
within 45 days after the close of each of the first three fiscal quarters of
each fiscal year of the Consolidated Parties, a consolidated balance sheet and
income statement of the Consolidated Parties as of the end of such fiscal
quarter, together with related consolidated statements of retained earnings and
cash flows for such fiscal quarter, in each case setting forth in comparative
form consolidated figures for the corresponding period of the preceding fiscal
year, all such financial information described above to be in reasonable form
and detail and reasonably acceptable to the Agent, and accompanied by a
certificate of an Executive Officer of the Borrower to the effect that such
quarterly financial statements fairly present in all material respects the
financial condition of the Consolidated Parties and have been prepared in
accordance with GAAP, subject to changes resulting from audit and normal
year-end audit adjustments.


 


(c)           Officer’s Certificate.  At the time of delivery of the financial
statements provided for in Sections 7.1(a) and 7.1(b) above, a certificate
of an Executive Officer of the Borrower substantially in the form of Exhibit 7.1(c),
(i) demonstrating compliance with the Financial Covenants by calculation
thereof as of the end of each such fiscal period, (ii) stating that no
Default or Event of Default exists, or if any Default or Event of Default does
exist, specifying the nature and extent thereof and what action the Credit
Parties propose to take with respect thereto and disclosing any Hedging
Agreements entered into by any Consolidated Party.


 


(d)           Intentionally Omitted.


 


(e)           Accountant’s Certificate.  Within the period for delivery of the annual
financial statements provided in Section 7.1(a), a certificate of the
accountants conducting the annual audit stating that they have reviewed this
Credit Agreement as it relates to accounting and other financial matters and stating
further whether, in the course of their audit, they have become aware of any
Default or Event of Default and, if any such Default or Event of Default
exists, specifying the nature and extent thereof, provided that such
accountants shall not be liable by reason of any failure to obtain knowledge of
any such Default or Event of Default that would not be disclosed in the course
of their audit examination.


 


(f)            Auditor’s Reports.  Promptly upon receipt thereof, a copy of any
other report or “management letter” submitted by independent accountants to any
Consolidated Party in connection with any annual, interim or special audit of
the books of such Person.


 


(g)           Reports.  Promptly upon transmission or receipt
thereof, (i) copies of any filings and registrations with, and reports to
or from, the Securities and Exchange Commission, or any successor agency, and
copies of all financial statements, proxy statements, notices and reports as
any Consolidated Party shall send to its shareholders or to a holder of any
Indebtedness owed by any Consolidated Party in its capacity as such a holder
and (ii) upon the request of the Agent, all reports and written
information to and from the United States Environmental Protection Agency, or
any state or local agency responsible for environmental matters, the United
States Occupational Health and Safety Administration, or any state or local
agency responsible for health and safety matters, or any successor agencies or
authorities concerning environmental, health or safety matters.


 


(h)           Notices.  Upon any Executive Officer of a Credit Party
obtaining knowledge thereof, the Credit Parties will give written notice to the
Agent immediately of (i) the occurrence of an event or condition


 


60

















 


consisting of a Default or Event of Default,
specifying the nature and existence thereof and what action the Credit Parties
propose to take with respect thereto, and (ii) the occurrence of any of
the following with respect to any Consolidated Party (A) the pendency or
commencement of any litigation, arbitral or governmental proceeding against
such Person which if adversely determined is likely to have a Material Adverse
Effect or (B) the institution of any proceedings against such Person with
respect to, or the receipt of notice by such Person of potential liability or
responsibility for violation, or alleged violation of any Federal, state or
local law, rule or regulation, including but not limited to, Environmental
Laws, the violation of which could have a Material Adverse Effect.


 


(i)            ERISA.  Upon any Executive Officer of a Credit Party
obtaining knowledge thereof, the Credit Parties will give written notice to the
Agent promptly (and in any event within five Business Days) of: (i) any
event or condition, including, but not limited to, any Reportable Event, that
constitutes, or might reasonably lead to, an ERISA Event; (ii) with
respect to any Multiemployer Plan, the receipt of notice as prescribed in ERISA
or otherwise of any withdrawal liability assessed against the Credit Parties or
any ERISA Affiliates, or of a determination that any Multiemployer Plan is in
reorganization or insolvent (both within the meaning of Title IV of
ERISA); (iii) the failure to make full payment on or before the due date
(including extensions) thereof of all amounts which any Consolidated Party or
any ERISA Affiliate is required to contribute to each Plan pursuant to its
terms and as required to meet the minimum funding standard set forth in ERISA
and the Code with respect thereto; or (iv) any change in the funding
status of any Plan that could have a Material Adverse Effect, together with a
description of any such event or condition or a copy of any such notice and a
statement by an Executive Officer of the Borrower briefly setting forth the
details regarding such event, condition, or notice, and the action, if any,
which has been or is being taken or is proposed to be taken by the Credit
Parties with respect thereto.  Promptly
upon request, the Credit Parties shall furnish the Agent and the Lenders with
such additional information concerning any Plan as may be reasonably requested,
including, but not limited to, copies of each annual report/return
(Form 5500 series), as well as all schedules and attachments thereto
required to be filed with the Department of Labor and/or the Internal Revenue
Service pursuant to ERISA and the Code, respectively, for each “plan year”
(within the meaning of Section 3(39) of ERISA).


 


(j)            Environmental.  Upon the reasonable written request of the
Agent, the Credit Parties will furnish or cause to be furnished to the Agent,
at the Credit Parties’ expense, a report of an environmental assessment of
reasonable scope, form and depth, (including, where appropriate, invasive soil
or groundwater sampling) by a consultant reasonably acceptable to the Agent as
to the nature and extent of the presence of any Materials of Environmental
Concern on any Real Properties (as defined in Section 6.16) contributing
to the Borrowing Base and as to the compliance by any Consolidated Party with
Environmental Laws at such Real Properties. 
If the Credit Parties fail to deliver such an environmental report
within seventy-five (75) days after receipt of such written request then
the Agent may arrange for same, and the Consolidated Parties hereby grant to
the Agent and their representatives access to the Real Properties to reasonably
undertake such an assessment (including, where appropriate, invasive soil or
groundwater sampling).  The reasonable
cost of any assessment arranged for by the Agent pursuant to this provision
will be payable by the Credit Parties on demand and added to the Credit Party
Obligations.


 


(k)           Borrowing Base
Certificates/Delinquency Reports. 
Within 15 days after the end of each calendar month, a certificate as of
the end of the immediately preceding month, substantially in the form of Exhibit 7.1(k)
and certified by an Executive Officer of the Borrower to be true and correct as
of the date thereof (a “Borrowing Base Certificate”) and a Delinquency
Report with respect to the last day of such calendar month certified by an
Executive Officer of the Borrower to be true and correct as of such date.


 


(l)            Three Year Projections/Updates.  As soon as available, and in any event
within 90 days after the close of each fiscal year of the Consolidated Parties,
detailed projections of financial statements for the Consolidated Parties and
of calculations with respect to each of the Financial Covenants, in each case,
for the three year period following the most recently ended fiscal quarter of
the Consolidated Parties.


 


(m)          Other Information.  With reasonable promptness upon any such
request, such other information regarding the business, properties or financial
condition of any Consolidated Party as the Agent or the Required Lenders may
reasonably request.


 


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(n)           Reportable Transactions.  Promptly after Borrower has notified Agent
of any intention by Borrower to treat Loans and related transactions as being a
“reportable transaction” (within the meaning of Treasury Regulation Section
1.6011-4), a duly completed copy of IRS Form 8886 or any successor form (and
Borrower hereby agrees that the Agent and each Lender may disclose to any and
all Persons, without limitation of any kind, any information with respect to
the “tax treatment” and “tax structure” (in each case, within the meaning of
Treasury Regulation Section 1.6011-4) of the transactions contemplated hereby
and all materials of any kind (including opinions or other tax analyses) that
are provided to the Agent or such Lender relating to such tax treatment and tax
structure).


 


7.2          Preservation of Existence, Franchises,
Bankruptcy Remote Borrowing Entity Status and REIT Status.


 


Except as a result of or in connection with a dissolution, merger or
disposition of a Subsidiary not prohibited by Section 8.4 or
Section 8.5, each Credit Party will, and will cause each of its corporate
Subsidiaries to, do all things necessary to preserve and keep in full force and
effect its existence, rights, franchises, authority and status as a REIT or
Qualified REIT Subsidiary, as applicable. The General SPE, HCI and its Wholly
Owned Subsidiaries, JV1 and its Wholly Owned Subsidiaries and S&C shall
each maintain their respective status as a Bankruptcy Remote Borrowing Entities
and each of the Credit Parties shall take such action as is required to
maintain such status at all times during the term hereof.  The General SPE shall, at all times during
the term hereof, remain a Wholly Owned Subsidiary of USRP Operating.  S&C shall, at all times during the term
hereof, remain a Wholly Owned Subsidiary of USRP Holding.  USRP Holding shall, at all times during the
term hereof, remain a Wholly Owned Subsidiary of USRP Operating.  JV1 shall, at all times during the term
hereof, remain a Wholly Owned Subsidiary of USRP Operating.  HCI shall, at all times during the term
hereof, be subject either to the ownership structure set forth on Schedule
6.13A as of the Closing Date or be a Wholly Owned Subsidiary of JV1. The entities
set forth on Schedule 6.26 shall, at all times during the term hereof,
remain taxable REIT subsidiaries, as such term is used in the Code; provided,
that such schedule may be amended from time to time by the Borrower with the
consent of the Agent, which consent may be withheld in the Agent’s reasonable
discretion.


 


7.3          Books and Records.


 


Each Credit Party will, and will cause each of its Subsidiaries to,
keep complete and accurate books and records of its transactions in accordance
with good accounting practices on the basis of GAAP (including the
establishment and maintenance of appropriate reserves).


 


7.4          Compliance
with Law.


 


Each Credit Party will, and will cause each of its Subsidiaries to,
comply with all laws, rules, regulations and orders, and all applicable
restrictions imposed by all Governmental Authorities, applicable to it and its
Property if noncompliance with any such law, rule, regulation, order or
restriction could have a Material Adverse Effect.


 


7.5          Payment of Taxes and Other Indebtedness.


 


Each Credit Party will, and will cause each of its Subsidiaries to, pay
and discharge (a) all taxes, assessments and governmental charges or
levies imposed upon it, or upon its income or profits, or upon any of its
properties, before they shall become delinquent, (b) all lawful claims
(including claims for labor, materials and supplies) which, if unpaid, might
give rise to a Lien upon any of its properties, and (c) except as
prohibited hereunder, all of its other Indebtedness as it shall become due; provided,
however, that no Consolidated Party shall be required to pay any such
tax, assessment, charge, levy, claim or Indebtedness which is being contested
in good faith by appropriate proceedings and as to which adequate reserves
therefor have been established in accordance with GAAP, unless the failure to
make any such payment (i) could give rise to an immediate right to
foreclose on a Lien securing such amounts or (ii) could have a Material
Adverse Effect.


 


7.6          Insurance.


 


Each Consolidated Party will, and will cause each of its Subsidiaries
to, at all times maintain in full force and effect insurance (including
worker’s compensation insurance, liability insurance, environmental insurance,
casualty


 


62

















 


insurance and business interruption insurance) in such amounts,
covering such risks and liabilities and with such deductibles or self-insurance
retentions as are in accordance with normal industry practice.  The present insurance coverage of the
Consolidated Parties is outlined as to carrier, policy number, expiration date,
type and amount on Schedule 7.6, and the Borrower shall update such
Schedule 7.6 and notify the Agent immediately upon the occurrence
of any change in such insurance coverage.


 


7.7          Maintenance of Property.


 


Each Credit Party will, will cause each of its Subsidiaries to, and (as
applicable) will use its best efforts to cause the applicable Person in
possession of a Real Property to, maintain and preserve its properties and
equipment material to the conduct of its business in good repair, working order
and condition, normal wear and tear and casualty and condemnation excepted, and
will make, or cause to be made, in such properties and equipment from time to
time all repairs, renewals, replacements, extensions, additions, betterments
and improvements thereto as may be needed or proper, to the extent and in the
manner customary for companies in similar businesses.


 


7.8          Performance of Obligations.


 


Each Credit Party will, and will cause each of its Subsidiaries to,
perform in all material respects all of its obligations under the terms of all
material agreements and all material indentures, mortgages, security agreements
or other debt instruments to which it is a party or by which it is bound.


 


7.9          Use of Proceeds.


 


The Borrower will use the proceeds of the Loans and will use the
Letters of Credit solely for the purposes set forth in Section 6.15.


 


7.10        Audits/Inspections.


 


Upon reasonable notice and during normal business hours, each Credit Party
will, and will cause each of its Subsidiaries to, permit representatives
appointed by the Agent, including, without limitation, independent accountants,
agents, attorneys, and appraisers to visit and inspect its property (subject to
the rights of tenants under their respective leases), including its books and
records, its accounts receivable and inventory, its facilities and its other
business assets, and to make photocopies or photographs thereof and to write
down and record any information such representative obtains and shall permit
the Agent or its representatives to investigate and verify the accuracy of
information provided to the Lenders and to discuss all such matters with the
officers, employees and representatives of such Person.


 


7.11        Financial
Covenants.


 


(a)           Leverage Ratio.  The Leverage Ratio, as of the last day of
each fiscal quarter of the Consolidated Parties, shall be (i) for fiscal
quarters ending on or before September 30, 2005, less than or equal to 0.65 to
1.0; and (ii) for fiscal quarters ending thereafter, less than or equal to .60
to 1.0.


 


(b)           Tangible Net Worth.  At all times the Tangible Net Worth shall be
greater than or equal to the sum of (i) $230,000,000.00, plus (ii) an
amount equal to 85% of the Net Cash Proceeds of any Equity Issuance by the
Consolidated Parties issued after September 30, 2003, calculated on a
cumulative basis.


 


(c)           Fixed Charge Coverage Ratio.  The Fixed Charge Coverage Ratio, as of the
last day of each fiscal quarter of the Consolidated Parties, shall be (i) for
fiscal quarters ending on or before September 30, 2005, greater than or equal
to 1.40 to 1.0; and (ii) for fiscal quarters ending thereafter, greater than or
equal to 1.50 to 1.0.


 


(d)           Distribution Limitation.  For any
given fiscal quarter of the Consolidated Parties, the aggregate sum of (i) the
amount of cash distributions made or declared by the Consolidated Parties to
their shareholders (excluding any shareholders which are Consolidated Parties) plus
(ii) the amount spent by the Consolidated Parties for the purpose of
repurchasing their own Capital Stock (whether common or preferred) shall not
exceed the greater of (1) the FFO Distribution Allowance for such fiscal
quarter or (2)


 


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so long as no
Default or Event of Default has occurred and is then continuing, the amount
necessary to maintain the status of the USRP REIT as a REIT.


 


(e)           Secured
Indebtedness to Asset Value Ratio. 
The ratio of (i) Secured Indebtedness of the Consolidated
Parties on a consolidated basis to (ii) the
sum of Asset Values for each of the Real Properties (less any amounts
attributable to Minority Interests) as of the end of each fiscal quarter of the
Consolidated Parties shall be less than or equal to 0.40 to 1.0.


 


(f)            Debt Service
Coverage Ratio.  The Debt Service
Coverage Ratio shall be, at all times, be equal to or greater than 2.25 to 1.0.


 


For clarification purposes, the Credit Parties shall be permitted, in
determining compliance with the financial covenants set forth above in clauses
(a), (c), (d) and (f) of this Section 7.11, to round the results of the final
ratio calculations (but not calculations of any of other amounts used in
determining such ratios) to the nearest hundredth (.01).


 


7.12        New
Subsidiaries.


 


As soon as practicable and in any event within 30 days after any Person
becomes a direct or indirect Subsidiary of the General Partner, the USRP REIT
or the Borrower, the Borrower shall provide the Agent with written notice
thereof setting forth information in reasonable detail describing all of the
assets of such Person and shall (a) if such Person is a Domestic
Subsidiary, cause such Person to (a) execute a Joinder Agreement in
substantially the same form as Exhibit 7.12 and (b) deliver
such other documentation as the Agent may reasonably request in connection
therewith, including, without limitation, financial statements, certified
resolutions and other organizational and authorizing documents of such Person,
favorable opinions of counsel to such Person (which shall cover, among other
things, the legality, validity, binding effect and enforceability of the
documentation referred to above) and other items of the types required to be
delivered pursuant to Section 5.1, as applicable, all in form, content and
scope reasonably satisfactory to the Agent; provided, that this
Section 7.12 shall not be construed to require USRP Funding 2001-A, L.P.,
USRP (SFGP), LLC, LLC, USRP (Hawaii), LLC, USRP (Bob), LLC and Fuel Supply,
Inc. (or their respective successor entities) to execute Joinder Agreements or
otherwise act as Subsidiary Guarantors hereunder unless and until (i) with
respect to USRP Funding 2001-A, L.P., such entity ceases to maintain its status
as a Special Purpose Entity, or (ii) with respect to each such entity, such
entity is not prohibited by the terms of other financing transactions or its
organizational documents from acting as a Guarantor hereunder.  For purposes of the preceding sentence, it
is understood that no entity shall be deemed prohibited from executing a
Joinder Agreement once it becomes a Wholly Owned Subsidiary by virtue of a
provision in its organizational documents notwithstanding any such provision in
such documents.


 


7.13        ERISA Exemptions.


 


Each Credit Party and the Borrower shall not,
and shall not permit any of their respective Subsidiaries to, permit any of
their respective assets to become or be deemed to be “plan assets” within the
meaning of ERISA, the Code and the respective regulations promulgated
thereunder.


 


7.14        Further Assurances.


 


The Borrower shall, from time to time, at the expense of the Borrower,
promptly execute, deliver, file and/or record all further instruments and
documents, and take all further action, that may be necessary or desirable, or
that the Agent or Collateral Agent may reasonably request in order to (a)
properly evidence the Borrower’s Indebtedness hereunder or under any Credit
Document or (b) perfect, continue and protect the pledge, assignment and/or
security interest, as applicable, granted or purported to be granted hereby or
pursuant to any Credit Document and to enable the Agent and/or Collateral Agent
to exercise and enforce their rights and remedies hereunder and under any other
Credit Document.  The Borrower shall promptly
deliver to the Collateral Agent a copy of each such instrument and evidence of
its proper filing or recording, as necessary.


 


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ARTICLE VIII


 


NEGATIVE COVENANTS


 


Each Credit Party hereby covenants and agrees that, so long as this
Credit Agreement is in effect or any amounts payable hereunder or under any
other Credit Document shall remain outstanding or any Letter of Credit is
outstanding, and until all of the Commitments hereunder shall have terminated:


 


8.1          Indebtedness.


 


The Credit Parties will not permit any Consolidated Party to contract,
create, incur, assume or permit to exist any Indebtedness, except:


 


(a)           Indebtedness arising under this
Credit Agreement, the other Credit Documents, the Term Loan Documents or
Indebtedness expressly permitted hereunder;


 


(b)           Indebtedness
under the Hawaii Loan Documents or in existence as of the Agreement Date and
described on Schedule 8.1 and any Indebtedness (the “Replacement
Indebtedness”) extending the maturity of, or refunding, refinancing or replacing,
in whole or in part, any such existing Indebtedness (the “Replaced
Indebtedness”) so long as (i) the direct and contingent obligors with
respect to the Replaced Indebtedness and the Replacement Indebtedness shall be
the same, (ii) the Replacement Indebtedness shall not mature prior to the
stated maturity date or mandatory redemption date of the Replaced Indebtedness,
(iii) if the Replaced Indebtedness is subordinated in right of payment or
otherwise to the obligations of each of the Credit Parties under and in respect
of the Credit Documents to which any of them is a party, then the Replacement
Indebtedness must be subordinated to such obligations to at least the same
extent and (iv) the Replacement Indebtedness otherwise complies with all other
terms and conditions contained in any other Section of this Credit
Agreement;


 


(c)           purchase money Indebtedness
(including obligations in respect of Capital Leases or Synthetic Leases)
hereafter incurred by the Borrower or any of its Subsidiaries to finance the
purchase of fixed assets; provided that (i) the total of all such
Indebtedness for all such Persons taken together shall not exceed an aggregate
principal amount of $250,000 at any one time outstanding; (ii) such
Indebtedness when incurred shall not exceed the purchase price of the asset(s)
financed; and (iii) no such Indebtedness shall be refinanced for a
principal amount in excess of the principal balance outstanding thereon at the
time of such refinancing;


 


(d)           Indebtedness resulting from customary
recourse carve-outs associated with securitization transactions (including, by
way of example, those for fraud, misapplication of proceeds and environmental
indemnities) and not involving the creditworthiness of the applicable obligors;


 


(e)           Indebtedness in the form of trade
payables incurred in the ordinary course of business;


 


(f)            obligations of the Borrower in
respect of Hedging Agreements to the extent such agreements are for the purpose
of hedging interest rate risk with respect to the Indebtedness under the Credit
Documents or are otherwise approved by the Agent, in its discretion;


 


(g)           intercompany Indebtedness permitted
under Section 8.6; provided, however,
that the obligations of each obligor of such Indebtedness shall: (i) be
subordinated to the Credit Party Obligations on terms acceptable to the
Required Revolving Lenders in their sole discretion and (ii) have such other
terms and provisions as the Agent may reasonably require;


 


(h)           in addition to the Indebtedness
otherwise permitted by this Section 8.1,


 


(i)            other recourse Indebtedness
hereafter incurred by the General Partner, the Borrower or any of their
Subsidiaries provided that (A) the loan documentation with respect
to such Indebtedness shall not contain financial covenants or default
provisions relating to any Consolidated Party that are more restrictive than
the covenants and default provisions contained in the Credit


 


65

















 


Documents, (B) the Borrower shall have
delivered to the Agent a Pro Forma Compliance Certificate demonstrating that,
upon giving effect on a Pro Forma Basis to the incurrence of such Indebtedness
and to the concurrent retirement of any other Indebtedness of any Consolidated
Party, the Credit Parties would be in compliance with the Financial Covenants
and (C) the aggregate principal amount of such Indebtedness, together with
Indebtedness permitted pursuant to Sections 8.1(c) and (f) shall not at
any time exceed $20,000,000 plus the amount of any hedge obligations incurred
with respect to a Term Securitization;


 


(ii)           Indebtedness where the recourse of
the lender is limited to foreclosure of its security interest in the subject
property; and


 


(iii)          Guaranty Obligations of any Guarantor
with respect to any Indebtedness permitted under this Section 8.1.


 


Notwithstanding the foregoing, the General
Partner and the Borrower shall not, and shall not permit any other Subsidiary
to, create, incur or assume any Indebtedness after the Closing Date if
immediately prior to the creation, incurring or assumption thereof, or
immediately thereafter and after giving effect thereto, a Default or Event of
Default is or would be in existence, including without limitation, a Default or
Event of Default resulting from a violation of any of the covenants contained
in this Section 8.1.


 


8.2          Liens.


 


The Credit Parties will not permit any Consolidated Party to contract,
create, incur, assume or permit to exist any Lien with respect to any of its
Property, whether now owned or after acquired, except for:


 


(a)           Liens in favor of the Agent to secure
the Credit Party Obligations;


 


(b)           (i) Liens, about which any Credit
Party has had knowledge for less than thirty (30) days, in an aggregate
amount less than $200,000 (other than Liens created or imposed under ERISA) for
taxes, assessments or governmental charges or levies not yet due or, if due,
are for taxes, assessments or governmental charges or levies that are more than
five (5) days from the date on which such items may be deemed delinquent
or on which penalties for non-payment may be assessed or (ii) Liens for taxes
being contested in good faith by appropriate proceedings for which adequate
reserves determined in accordance with GAAP have been established (and as to
which the Property subject to any such Lien is not yet subject to foreclosure,
sale or loss on account thereof);


 


(c)           statutory Liens of landlords and
Liens of carriers, warehousemen, mechanics, materialmen and suppliers and other
Liens imposed by law or pursuant to customary reservations or retentions of title
arising in the ordinary course of business, in each case which any Credit Party
has had knowledge for less than thirty (30) days, in an aggregate amount
less than $200,000, provided that such Liens secure only amounts not yet
due and payable or, if due and payable, are unfiled and no other action has
been taken to enforce the same or are being contested in good faith by
appropriate proceedings for which adequate reserves determined in accordance
with GAAP have been established (and as to which the Property subject to any
such Lien is not yet subject to foreclosure, sale or loss on account thereof);


 


(d)           Liens (other than Liens created or
imposed under ERISA) incurred or deposits made by any Consolidated Party in the
ordinary course of business in connection with workers’ compensation,
unemployment insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, bids, leases, government
contracts, performance and return-of-money bonds and other similar obligations
(exclusive of obligations for the payment of borrowed money);


 


(e)           Liens in connection with attachments
or judgments (including judgment or appeal bonds) provided that the
judgments secured shall, within 30 days after the entry thereof, have been
discharged or execution thereof stayed pending appeal, or shall have been
discharged within 30 days after the expiration of any such stay;


 


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(f)            easements, rights-of-way,
restrictions (including zoning restrictions), minor defects or irregularities
in title and other similar charges or encumbrances not, in any material
respect, impairing the use of the encumbered Property for its intended
purposes;


 


(g)           Liens on Property of any Person
securing purchase money Indebtedness (including Capital Leases and Synthetic
Leases) of such Person permitted under Section 8.1(c), provided
that any such Lien attaches to such Property concurrently with or within 90
days after the acquisition thereof;


 


(h)           leases or subleases granted to others
not interfering in any material respect with the business of any Consolidated
Party;


 


(i)            any interest of title of a lessor
under, and Liens arising from UCC financing statements (or equivalent filings,
registrations or agreements in foreign jurisdictions) relating to, leases
permitted by this Credit Agreement;


 


(j)            Liens deemed to exist in connection
with Investments in repurchase agreements permitted under Section 8.6;


 


(k)           normal and customary rights of setoff
upon deposits of cash in favor of banks or other depository institutions;


 


(l)            Liens of a collection bank arising
under Section 4-210 of the Uniform Commercial Code on items in the course
of collection;


 


(m)          Liens of sellers of goods to the
Borrower and any of its Subsidiaries arising under Article 2 of the
Uniform Commercial Code or similar provisions of applicable law in the ordinary
course of business, covering only the goods sold and securing only the unpaid
purchase price for such goods and related expenses;


 


(n)           Liens existing as of the Closing Date
as set forth or as contemplated on Schedule 8.2; provided
that no such Lien shall at any time be extended to or cover any Property
other than the Property subject thereto on the Closing Date (other than in
connection with the collateral substitution provisions contained in the 2001-A
Term Securitization Documents);


 


(o)           Liens on property owned by USRP
(Bob), LLC, USRP (Hawaii), LLC and/or Fuel Supply, Inc. created in connection
with the Hawaii Loan Documents; and


 


(p)           Liens securing Indebtedness described
in Section 8.1(h)(ii).


 


8.3          Nature
of Business.


 


The Credit Parties will not permit any Consolidated Party to
substantively alter the character or conduct of the business conducted by such
Person as of the Closing Date.


 


8.4          Consolidation, Merger, Dissolution, etc.


 


The Credit Parties will not permit any Consolidated Party to enter into
any transaction of merger or consolidation or liquidate, wind up or dissolve
itself (or suffer any liquidation or dissolution); provided that,
notwithstanding the foregoing provisions of this Section 8.4 but subject
to the terms of Sections 7.12, (a) the Borrower or General Partner
may merge or consolidate with any of its Subsidiaries provided that the
Borrower or General Partner (as applicable) shall be the continuing or
surviving corporation, (b) any Credit Party other than the General Partner
or the Borrower may merge or consolidate with any other Credit Party other than
the General Partner or the Borrower, (c) any Consolidated Party which is not
a Credit Party may be merged or consolidated with or into any Credit Party; provided
that such Credit Party shall be the continuing or surviving corporation,
(d) any Consolidated Party which is not a Credit Party may be merged or
consolidated with or into any other Consolidated Party which is not a Credit
Party, and (e) any Wholly Owned Subsidiary of the Borrower may dissolve,
liquidate or wind up its affairs at any time provided that such


 


67

















 


dissolution, liquidation or winding up, as applicable, could not have a
Material Adverse Effect and such entity does not hold any material property or
assets (except to the extent such property or assets are able to be transferred
to a Credit Party without additional consideration from such Credit Party and
without adverse tax consequences to such Credit Party).


 


8.5          Asset
Dispositions/Substitution of Assets.


 


(a)           The Credit Parties will not permit
any Consolidated Party to make any Asset Disposition or series of Asset
Dispositions in which the aggregate value of the assets sold or otherwise
disposed pursuant to such Asset Disposition or series of Asset Dispositions
exceeds an amount equal to (i) ten percent (10.0%) multiplied by (ii)
Total Tangible Assets, as calculated on the Closing Date, unless the Borrower
shall have delivered to the Agent at least two (2) Business Days prior to
such Asset Disposition or series of Asset Dispositions a Pro Forma Compliance
Certificate demonstrating on a Pro Forma Basis that, upon giving effect to such
Asset Disposition or series of Asset Dispositions, the Credit Parties shall be
in compliance with all of the covenants contained in Section 7.11.


 


(b)           Neither the General SPE, nor HCI or
any of its Wholly Owned Subsidiaries, nor JV1 or any of its Wholly Owned
Subsidiaries, nor S&C shall sell, transfer, assign, pledge, encumber or
otherwise dispose of any of their respective assets except to the extent such
entity obtains the prior written consent of the Agent (which consent may be
withheld at the sole reasonable discretion of the Agent).


 


8.6          Investments.


 


The Credit Parties will not permit any Consolidated Party to make or
have any Investments after the Closing Date, except for:


 


(a)           Investments in any Credit Party;


 


(b)           Investments consisting of cash and
Cash Equivalents;


 


(c)           Investments consisting of accounts
receivable created, acquired or made by any Consolidated Party in the ordinary
course of business and payable or dischargeable in accordance with customary
trade terms;


 


(d)           Investments consisting of Capital
Stock, obligations, securities or other property received by any Consolidated
Party in settlement of accounts receivable (created in the ordinary course of
business) from bankrupt obligors or guarantors of bankrupt obligors;


 


(e)           Investments consisting of loans or
advances to Tenants in an amount not to exceed $25,000,000.00 in the aggregate;


 


(f)            Investments consisting of advances
or loans to employees existing as of the date hereof and additional such
Investments made following the date hereof that do not, in the aggregate,
exceed the sum of $100,000.00;


 


(g)           Investments entered into in
connection with a Term Securitization permitted and contemplated hereunder;


 


(h)           Investments in non-wholly owned
general and limited partnerships, joint ventures and other Persons which are
not corporations (excluding such Investments in existence as of the date
hereof), the aggregate book value of which constitutes less than five
percent (5%) of Total Tangible Assets;


 


(i)            Investments in Development Activities;
provided, that (i) the aggregate amount of Investments made by the
Consolidated Parties with respect to such Development Activities shall not, at
any one time, exceed $15,000,000.00 and (ii) all costs and expenses associated
with all existing Development Activities


 


68

















 


(budget to completion) shall be included in
determining the aggregate Investment of the Consolidated Parties with respect
to such activities;


 


(j)            Investments consisting of loans to
Persons who have or are purchasing real property from a Consolidated Party;
provided that (i) the total aggregate amount of such loans shall not exceed
$45,000,000.00, (ii) such loans shall be made on a secured basis and (iii) such
loans shall be made on commercially reasonable terms and require at least 10%
cash equity;


 


(k)           Investments in marketable securities
that do not, in the aggregate, exceed the sum of $5,000,000.00;


 


(l)            Investments in common equity
securities that do not, in the aggregate, exceed the sum of $5,000,000.00 and
Investments in preferred equity securities that do not, in the aggregate,
exceed the sum of $5,000,000.00; provided, that, the Agent is given a summary
of the amount and type of such equity securities prior to the making of such investment;
and


 


(m)          Investments in debt securities that do
not, in the aggregate, exceed $30,000,000.00; provided, that such debt
securities are fully performing and have a current yield equal to or in excess
of 9.50%.


 


Notwithstanding the foregoing, the Credit Parties will not permit the
total Investments of the Consolidated Parties related to items (c) through (m)
above shall not, in any case, exceed 12.0% of Total Tangible Assets.


 


8.7          Restricted Payments.


 


Except as set forth on Schedule 8.11, the Credit Parties
will not permit any Consolidated Party to, directly or indirectly, declare,
order, make or set apart any sum for or pay any Restricted Payment, except
(a) to make dividends or other distributions payable to any Credit Party
(directly or indirectly through Subsidiaries), (b) Special Purpose Entities may (directly or indirectly through any
intermediate Subsidiaries) (i) make Restricted Payments to the extent required
to do so under the terms of a Term Securitization and (ii) distribute I/O
Strips and other assets to the General Partner, the Borrower or any other
Guarantor and (c) as expressly permitted by Section 7.11(d),
Section 8.6, Section 8.8 or Section 8.9.


 


8.8          Other
Indebtedness.


 


The Credit Parties will not permit any Consolidated Party to if any
Default or Event of Default has occurred and is continuing or would be directly
or indirectly caused as a result thereof, (a) after the issuance thereof,
amend or modify any of the terms of any Indebtedness of such Consolidated Party
if such amendment or modification would add or change any terms in a manner
adverse to such Consolidated Party, or shorten the final maturity or average
life to maturity or require any payment to be made sooner than originally
scheduled or increase the interest rate applicable thereto, or (b) make (or
give any notice with respect thereto) any voluntary or optional payment or
prepayment or redemption or acquisition for value of (including without
limitation, by way of depositing money or securities with the trustee with respect
thereto before due for the purpose of paying when due), refund, refinance or
exchange of any other Indebtedness of such Consolidated Party.


 


8.9          Transactions with Affiliates.


 


The Credit Parties will not permit any Consolidated Party to enter into
or permit to exist any transaction or series of transactions with any officer,
director, shareholder, Subsidiary or Affiliate of such Person other than
(a) advances of working capital to any Credit Party, (b) transfers of
cash and assets to any Credit Party, (c) intercompany transactions
expressly permitted by Section 8.1, Section 8.4, Section 8.5,
Section 8.6, or Section 8.7, (d) normal compensation and
reimbursement of expenses of officers and directors and (e) except as
otherwise specifically limited in this Credit Agreement, other transactions
which are entered into in the ordinary course of such Person’s business on
terms and conditions substantially as favorable to such Person as would be
obtainable by it in a comparable arms-length transaction with a Person other
than an officer, director, shareholder, Subsidiary or Affiliate.


 


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8.10        Fiscal Year; Organizational Documents.


 


The Credit Parties will not permit any Consolidated Party to change its
fiscal year or amend, modify or change its articles of incorporation (or
corporate charter or other similar organizational document) or bylaws (or other
similar document).


 


8.11        Limitation
on Restricted Actions.


 


The Credit Parties will not permit any Consolidated Party to, directly
or indirectly, create or otherwise cause or, except as set forth on Schedule 8.11,
suffer to exist or become effective any encumbrance or restriction on the
ability of any such Person to (a) pay dividends or make any other
distributions to any Credit Party on its Capital Stock or with respect to any
other interest or participation in, or measured by, its profits, (b) pay
any Indebtedness or other obligation owed to any Credit Party, (c) make
loans or advances to any Credit Party, (d) sell, lease or transfer any of
its properties or assets to any Credit Party, or (e) act as a Credit Party
and pledge its assets pursuant to the Credit Documents or any renewals,
refinancings, exchanges, refundings or extension thereof, except (in respect of
any of the matters referred to in clauses (a)-(d) above) for such
encumbrances or restrictions existing under or by reason of (i) this
Credit Agreement and the other Credit Documents, (ii) applicable law,
(iii) any document or instrument governing Indebtedness incurred pursuant
to (A) Section 8.1(b), and (B) with respect to clause (d) of this
Section 8.11 only, Section 8.1(h), provided that any such
restriction contained therein relates only to the asset or assets constructed
or acquired in connection therewith, (iv) any Permitted Lien or any
document or instrument governing any Permitted Lien, provided that any
such restriction contained therein relates only to the asset or assets subject
to such Permitted Lien or (v) customary restrictions and conditions contained
in any agreement relating to the sale of any Property permitted under
Section 8.5 pending the consummation of such sale.


 


8.12        Contingent Obligations.


 


Neither the General Partner nor the Borrower
shall become or remain liable, or permit any other Subsidiary to become or
remain liable, on or under any Contingent Obligation other than the following:


 


(a)           Contingent
Obligations arising under any of the Credit Documents;


 


(b)           Contingent
Obligations in existence as of the Closing Date (the material ones having been
disclosed to the Agent in writing on Schedule 8.12(b) attached
hereto) and any Contingent Obligation incurred in replacement, in whole or in
part, of any such existing Contingent Obligations so long as (i) the amount of
such replacement Contingent Obligation shall not be increased, (ii) such
replacement Contingent Obligation shall not mature or otherwise be required to
be performed prior to the corresponding maturity or performance date of the
Contingent Obligation being so replaced, and (iii) if the Contingent Obligation
being so replaced is subordinated to any of the Credit Party Obligations, such
replacement Contingent Obligation shall be subordinated to such obligations to
at least the same extent;


 


(c)           Contingent
Obligations resulting from endorsement of negotiable instruments for collection
or deposit in the ordinary course of business;


 


(d)           Contingent
Obligations incurred in the ordinary course of business with respect to surety
and appeal bonds, performance and return-of-money bonds and other similar
obligations;


 


(e)           Contingent
Obligations to the extent constituting Indebtedness permitted under
Section 8.1; and


 


(f)            Guaranties
by a Consolidated Party of the obligations of another Consolidated Party;


 


8.13        Sale Leasebacks.


 


Notwithstanding anything contained herein to the contrary, the Credit
Parties will not permit any Consolidated Party to enter into any Sale and
Leaseback Transaction (except to the extent USRP (Bob), LLC or USRP (Hawaii),
LLC enters into any such transaction with respect to any gas station assets
held by such Person).


 


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8.14        Borrowing
Base Asset Removal.


 


Notwithstanding anything to the contrary contained herein, no Credit
Party shall, at any time, seek to otherwise voluntarily remove or permit to be
removed any Borrowing Base Assets from qualification as such (whether in
anticipation of the Disposition or encumbrance thereof or otherwise), unless
(a) the Borrower shall have delivered to the Agent (and, to the extent such removal
shall require Required Lender approval, the Required Lenders) at least twenty
(20) Business Days prior to the effective date of such removal, a Pro Forma
Compliance Certificate demonstrating that, upon giving effect to such removal,
on a Pro Forma Basis, the Credit Parties shall be in compliance with all of the
Financial Covenants contained herein and (b) to the extent (i) the Borrowing
Base Asset Value attributable to the Borrowing Base Asset(s) proposed for
removal, plus the Borrowing Base Asset Values attributable to all other such
assets that have been removed during the previous twelve (12) calendar months
or that have been approved for removal pursuant to the terms hereof during such
period (and which the Borrower still intends to remove from the Borrowing Base
calculation) is less than ten percent (10.0%) of the aggregate Borrowing Base
Asset Value, as determined as of the Closing Date, the Agent has, in its
reasonable discretion, approved such removal in writing; or (ii) the Borrowing
Base Asset Value attributable to the Borrowing Base Asset(s) proposed for
removal, plus the Borrowing Base Asset Values attributable to all other such
assets that have been removed during the previous twelve (12) calendar months
or that have been approved for removal pursuant to the terms hereof during such
period (and which the Borrower still intends to remove from the Borrowing Base
calculation) is greater than ten percent (10.0%) of the aggregate Borrowing
Base Asset Value, as determined as of the Closing Date, the Agent and the
Required Lenders have approved such removal in writing; provided, however, that
to the extent the Borrowing Base Asset Value attributable to the Borrowing Base
Asset(s) proposed for removal, plus the Borrowing Base Asset Values attributable
to all other such assets that have been removed during the term hereof or that
have been approved for removal pursuant to the terms hereof during such period
(and which the Borrower still intends to remove from the Borrowing Base
calculation) is greater than twenty percent (20.0%) of the aggregate Borrowing
Base Asset Value, as determined as of the Closing Date, such removal shall, in
any case, require the written approval of the Agent and the Required
Lenders.  All approvals or rejections of
removal requests delivered by the Borrower to the Agent and/or Required Lenders
hereunder shall be delivered by the Agent and/or the Required Lenders, as
applicable, within fifteen (15) days of their receipt thereof or shall be
deemed to be an approval of such request.


 


8.15        Negative
Pledges/Liens.


 


Notwithstanding anything contained herein or in any other Credit
Document to the contrary:


 


(a)           none of the
Consolidated Parties shall, at any time, enter into, assume or become subject
to any Negative Pledge on their Property
prohibiting or otherwise restricting the existence of any Lien upon any of its
Property in favor of the Agent (for the benefit of the Lenders) for the purpose
of securing the Credit Party Obligations, except (i) in connection with any
document or instrument governing Indebtedness incurred in accordance with
Section 8.1(c); provided, that any such restriction contained therein
relates only to the asset or assets constructed or acquired in connection
therewith, (ii) in connection with any Permitted Lien or any document or
instrument governing any Permitted Lien, provided, that any such restriction
contained therein relates only to the asset or assets subject to such Permitted
Lien, (iii) pursuant to customary restrictions and conditions contained in any
agreement relating to the sale of any Property permitted under
Section 8.5, pending the consummation of such sale and (iv) with respect
to USRP (Bob), LLC, USRP (Hawaii), LLC and Fuel Supply, Inc., pursuant to the
terms of the Hawaii Loan Documents;


 


(b)           none of the
Consolidated Parties shall, at any time, pledge or otherwise encumber (except
in connection herewith or with any of the Credit Documents) any income derived
from any of the assets contributing to the calculation of Borrowing Base Asset
Value (except to the extent permitted pursuant to Section 8.14 hereof);


 


(c)           the General SPE
shall not, at any time, contract, create, incur, assume or permit to exist any
Lien with respect to any of its assets except to the extent such Liens are of
the types described in Sections 8.2(a), (b), (c), (d), (e), (f), (h) and (i);


 


(d)           the General SPE shall  not, in any case, incur any
Indebtedness or Contingent Obligations aside from Indebtedness and/or
Contingent Obligations arising in connection with the Credit Documents and
Indebtedness and/or Contingent Obligations of the type described in Section
8.1(e);


 


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(e)           USRP Operating shall
not, at any time, contract, create, incur, assume or permit to exist any Lien
on its ownership interests in the General SPE or on the income derived
therefrom (except to the extent such Liens arise in connection with the Credit
Documents);


 


(f)            S&C shall not,
at any time, contract, create, incur, assume or permit to exist any Lien with
respect to any of its assets except to the extent such Liens are of the types
described in Sections 8.2(a), (b), (c), (d), (e), (f), (h) and (i);


 


(g)           S&C shall  not, in any case, incur any Indebtedness
or Contingent Obligations aside from Indebtedness and/or Contingent Obligations
arising in connection with the Credit Documents and Indebtedness and/or
Contingent Obligations of the type described in Section 8.1(e);


 


(h)           USRP Holding shall
not, at any time, contract, create, incur, assume or permit to exist any Lien on
its ownership interests in S&C or on the income derived therefrom (except
to the extent such Liens arise in connection with the Credit Documents);


 


(i)            HCI and its Wholly
Owned Subsidiaries shall not, at any time, contract, create, incur, assume or
permit to exist any Lien with respect to any of its assets except to the extent
such Liens are of the types described in Sections 8.2(a), (b), (c), (d), (e),
(f), (h) and (i);


 


(j)            HCI  and its Wholly Owned Subsidiaries shall  not, in any case, incur any Indebtedness
or Contingent Obligations aside from Indebtedness and/or Contingent Obligations
arising in connection with the Credit Documents and Indebtedness and/or
Contingent Obligations of the type described in Section 8.1(e);


 


(k)           JVI shall not, at
any time, contract, create, incur, assume or permit to exist any Lien on its
ownership interests in HCI or on the income derived therefrom (except to the
extent such Liens arise in connection with the Credit Documents);


 


(l)            JV1 and its Wholly
Owned Subsidiaries shall not, at any time, contract, create, incur, assume or
permit to exist any Lien with respect to any of its assets except to the extent
such Liens are of the types described in Sections 8.2(a), (b), (c), (d), (e),
(f), (h) and (i);


 


(m)          JV1  and its Wholly Owned Subsidiaries shall  not, in any case, incur any Indebtedness
or Contingent Obligations aside from Indebtedness and/or Contingent Obligations
arising in connection with the Credit Documents and Indebtedness and/or
Contingent Obligations of the type described in Section 8.1(e); and


 


(n)           USRP Operating shall
not, at any time, contract, create, incur, assume or permit to exist any Lien
on its ownership interests in JV1 or on the income derived therefrom (except to
the extent such Liens arise in connection with the Credit Documents).


 


8.16        Operating
Lease Obligations.


 


The Credit Parties will not permit any Consolidated Party to enter
into, assume or permit to exist any obligations for the payment of rental under
Operating Leases (excluding Ground Lease Interests) which in the aggregate for
all such Persons would exceed $1,000,000 in any fiscal year.


 


8.17        No
Foreign Subsidiaries.


 


The Credit Parties will not create, acquire or permit to exist any
Foreign Subsidiary.


 


8.18        Ground Leases.


 


For all leases executed following the Closing Date, the
USRP REIT, the General Partner and the Borrower shall, and shall not permit any
other Consolidated Subsidiary to, lease as lessee any real property pursuant to
a ground lease unless such ground lease contains customary provisions
protective of any lender to the lessee which


 


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provisions do
not vary in any material respect from those required under the Borrower’s
standard underwriting procedures and policies.


 


8.19        ERISA Exemptions.


 


The USRP REIT, the General Partner and the
Borrower shall not, and shall not permit any other Consolidated Subsidiary to,
permit any of its respective assets to become or be deemed to be “plan assets”
within the meaning of ERISA, the Code and the respective regulations
promulgated thereunder.


 


8.20        Transfer
of Assets to Non-Guarantor Subsidiaries and Affiliates.


 


The USRP REIT, the General Partner and the
Borrower shall not, and shall not permit any other Consolidated Subsidiary to,
transfer any of their respective assets to any of their respective Subsidiaries
or Affiliates except to the extent the applicable Subsidiary or Affiliate has,
at the time of such transfer, executed a Joinder Agreement and is a Guarantor
hereunder.


 


8.21        Term Loan Document Covenants and Amendments.


 


Borrower shall not violate any of the covenants, terms or conditions
set forth in the Term Loan Documents (except to the extent such covenants,
terms or conditions are waived in accordance with the terms thereof) or
otherwise permit to exist any “Event of Default” (as defined in the Term Loan
Agreement) to occur at any time during the term of this Credit Agreement.


 


ARTICLE IX


 


EVENTS OF DEFAULT


 


 


9.1          Events of Default.


 


An Event of Default shall exist upon the occurrence and during the
continuance of any of the following specified events (each an “Event of
Default”):


 


(a)           Payment.  Any Credit Party shall


 


(i)            default in the payment when due of
any principal of any of the Loans or of any reimbursement obligations arising
from drawings under Letters of Credit, or


 


(ii)           default, and such default shall
continue for three (3) or more Business Days, in the payment when due of
any interest on the Loans or on any reimbursement obligations arising from
drawings under Letters of Credit, or of any Fees or other amounts owing
hereunder, under any of the other Credit Documents or in connection herewith or
therewith; or


 


(b)           Representations.  Any representation, warranty or statement
made or deemed to be made by any Credit Party herein, in any of the other
Credit Documents, or in any statement or certificate delivered or required to
be delivered pursuant hereto or thereto shall prove untrue in any material
respect on the date as of which it was deemed to have been made; or


 


(c)           Covenants.  Any Credit Party shall


 


(i)            default in the due performance or
observance of any term, covenant or agreement contained in Sections 7.2,
7.9, 7.11 or 7.12 or Section 8;


 


(ii)           default in the due performance or
observance of any term, covenant or agreement contained in
Sections 7.1(a), (b), (c) or (k) or either of Sections 7.10 or 7.14 and
such default shall


 


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continue unremedied for a period of at least
5 days after the earlier of an Executive Officer of a Credit Party becoming
aware of such default or notice thereof by the Agent; or


 


(iii)          default in the due performance or
observance by it of any term, covenant or agreement (other than those referred
to in subsections (a), (b), (c)(i) or (c)(ii) of this Section 9.1)
contained in this Credit Agreement or any other Credit Document and such
default shall continue unremedied for a period of at least 30 days after the
earlier of an Executive Officer of a Credit Party becoming aware of such
default or notice thereof by the Agent; or


 


(d)           Other
Credit Documents.  Except as a
result of or in connection with a dissolution, merger or disposition of a
Subsidiary not prohibited by Section 8.4 or Section 8.5, any Credit
Document shall fail to be in full force and effect or to give the Agent and/or
the Lenders the Liens, rights, powers and privileges purported to be created
thereby, or any Credit Party shall so state in writing; or


 


(e)           Guaranties.  Except as the result of or in connection
with (i) a dissolution, merger or disposition of a Subsidiary not prohibited by
Section 8.4 or Section 8.5 or (ii) a release specifically provided
for in Section 4.8, the guaranty given by any Guarantor hereunder
(including any Person after the Closing Date in accordance with Section 7.12)
or any provision thereof shall cease to be in full force and effect, or any
Guarantor (including any Person after the Closing Date in accordance with
Section 7.12) hereunder or any Person acting by or on behalf of such
Guarantor shall deny or disaffirm such Guarantor’s obligations under such
guaranty, or any Guarantor shall default in the due performance or observance
of any term, covenant or agreement on its part to be performed or observed
pursuant to any guaranty; or


 


(f)            Bankruptcy,
etc.  Any Bankruptcy Event shall
occur with respect to the Borrower, the General Partner or any other
Consolidated Party; or


 


(g)           Challenge of Credit Documents.  The Borrower or any Guarantor shall disavow,
revoke or terminate or attempt to do any of the foregoing with respect to any
Credit Document to which it is a party or shall otherwise challenge or contest
in any action, suit or proceeding in any court or before any Governmental
Authority the validity or enforceability of any Credit Document; or


 


(h)           Defaults
under Other Agreements.


 


(i)            Any Consolidated Party shall default
in the performance or observance (beyond the applicable grace period with
respect thereto, if any) of any material obligation or condition of any
contract or lease material to the Consolidated Parties taken as a whole if such
default could reasonably be expected to have a Material Adverse Effect; or


 


(ii)           With respect to Indebtedness (other
than Indebtedness outstanding under this Credit Agreement) in excess of
$5,000,000 in the aggregate (for the Consolidated Parties taken as a whole),
(A) either (1) a default in any payment shall occur and continue
(beyond the applicable grace period with respect thereto, if any) with respect
to any such Indebtedness, (2) a default in the observance or performance
relating to such Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto and such default is not cured within
the applicable grace period, if any, or 
(3) any event or condition shall occur or exist, the effect of which event
or condition is to cause, or permit, the holder or holders of such Indebtedness
(or trustee or agent on behalf of such holders) to cause any such Indebtedness
to become due prior to its stated maturity; or (B) any such Indebtedness
shall be declared due and payable, or required to be prepaid other than by a
regularly scheduled required prepayment, prior to the stated maturity thereof;
or


 


(i)            Judgments.  One or more judgments or decrees shall be
entered against one or more of the Consolidated Parties involving a liability
of $1,000,000 or more in the aggregate (to the extent not paid or fully covered
by insurance provided by a carrier who has acknowledged coverage and has the
ability to perform) and any such judgments or decrees shall not have been vacated,
discharged or stayed or bonded pending appeal within 30 days from the entry
thereof; or


 


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(j)            ERISA.  Any of the following events or conditions,
if such event or condition could involve possible taxes, penalties, and other
liabilities in an aggregate amount in excess of $1,000,000:  (i) any “accumulated funding
deficiency,” as such term is defined in Section 302 of ERISA and
Section 412 of the Code, whether or not waived, shall exist with respect
to any Plan, or any lien shall arise on the assets of any Consolidated Party or
any ERISA Affiliate in favor of the PBGC or a Plan; (ii) an ERISA Event
shall occur with respect to a Single Employer Plan, which is, in the reasonable
opinion of the Agent, likely to result in the termination of such Plan for
purposes of Title IV of ERISA; (iii) an ERISA Event shall occur with
respect to a Multiemployer Plan or Multiple Employer Plan, which is, in the
reasonable opinion of the Agent, likely to result in (A) the termination
of such Plan for purposes of Title IV of ERISA, or (B) any
Consolidated Party or any ERISA Affiliate incurring any liability in connection
with a withdrawal from, reorganization of (within the meaning of
Section 4241 of ERISA), or insolvency (within the meaning of
Section 4245 of ERISA) of such Plan; or (iv) any prohibited
transaction (within the meaning of Section 406 of ERISA or
Section 4975 of the Code) or breach of fiduciary responsibility shall
occur which may subject any Consolidated Party or any ERISA Affiliate to any
liability under Sections 406, 409, 502(i), or 502(l) of ERISA or
Section 4975 of the Code, or under any agreement or other instrument
pursuant to which any Consolidated Party or any ERISA Affiliate has agreed or
is required to indemnify any person against any such liability; or


 


(k)           Ownership.  There shall occur a Change of Control; or


 


(l)            REIT
Status.  The USRP REIT shall, for
any reason, lose or fail to maintain its status as a REIT; or


 


(m)          Material
Adverse Effect.  The Borrower, the
General Partner, any Consolidated Party or any combination thereof shall
experience a change in financial condition that, in the reasonable opinion of
the Agent, has or will have a Material Adverse Effect; or


 


(n)           Disposition
of Assets. The proceeds generated from sales, conveyances and dispositions
(whether such transactions are entered into voluntarily or otherwise and
exclusive of the cash proceeds generated by a Term Securitization) of the
assets of the Borrower, General Partner and their Subsidiaries for the period
commencing as of the Closing Date and extending through any given date during
the term hereof are, in the aggregate, greater than an amount equal to (i)
twenty-five percent (25.0%) multiplied by (ii) Total Tangible Assets, as
calculated as of the Closing Date; or


 


(o)           Material
Change in Management, Operations or Business.  There shall occur a Change in Management.


 


9.2          Acceleration; Remedies.


 


Subject to the terms of the Intercreditor Agreement, upon the
occurrence and during the continuance of an Event of Default, the Agent may or,
upon the request and direction of the Required Revolving Lenders, shall, by
written notice to the Credit Parties take any of the following actions:


 


(a)           Termination
of Commitments.  Declare the
Commitments terminated whereupon the Commitments shall be immediately
terminated.


 


(b)           Acceleration.  Declare the unpaid principal of and any
accrued interest in respect of all Loans, any reimbursement obligations arising
from drawings under Letters of Credit and any and all other indebtedness or
obligations of any and every kind owing by the Credit Parties to the Agent
and/or any of the Lenders hereunder to be due whereupon the same shall be
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Credit Parties.


 


(c)           Cash
Collateral.  Direct the Borrower to
pay (and the Borrower hereby promises to pay, upon receipt of such notice) to
the Agent additional cash, to be held by the Agent, for the benefit of the
Lenders, in a cash collateral account as additional security for the LOC
Obligations in respect of subsequent drawings under all then outstanding
Letters of Credit in an amount equal to the maximum aggregate amount which may
be drawn under all Letters of Credits then outstanding or as additional
security for the


 


75

















 


reimbursement of any subsequent drawings in relation to the Derivative
Exposure Reserve in an amount equal to the Aggregate Derivative Reserve Amount.


 


(d)           Enforcement
of Rights.  Enforce any and all
rights and interests created and existing under the Credit Documents including,
without limitation, all rights and remedies against any Guarantor and all
rights of set-off.


 


Notwithstanding the foregoing, if an Event of Default specified in
Section 9.1(f) shall occur with respect to the Borrower, then, without the
giving of any notice or other action by the Agent or the Lenders, (i) the
Commitments automatically shall terminate, (ii) all of the outstanding
Credit Party Obligations automatically shall immediately become due and
payable, (iii) the Borrower automatically shall be obligated (and hereby
promises) to pay to the Agent additional cash, to be held by the Agent, for the
benefit of the Lenders, in a cash collateral account as additional security for
the LOC Obligations in respect of subsequent drawings under all then
outstanding Letters of Credit in an amount equal to the maximum aggregate
amount which may be drawn under all Letters of Credits then outstanding and
(iv) the Borrower automatically shall be obligated (and hereby promises) to pay
to the Agent additional cash, to be held by the Agent, for the benefit of the
Lenders, in a cash collateral account as additional security for the
reimbursement of any subsequent drawings in relation to the Derivative Exposure
Reserve in an amount equal to the Aggregate Derivative Reserve Amount.


 


 


ARTICLE X


 


AGENCY PROVISIONS


 


10.1        Appointment,
Powers and Immunities.


 


Each Lender hereby irrevocably appoints and authorizes the Agent to act
as its agent under this Credit Agreement and the other Credit Documents with
such powers and discretion as are specifically delegated to the Agent by the
terms of this Credit Agreement and the other Credit Documents, together with
such other powers as are reasonably incidental thereto.  The Agent (which term as used in this
sentence and in Section 10.5 and the first sentence of Section 10.6
hereof shall include its Affiliates and its own and its Affiliates’ officers,
directors, employees, and agents): 
(a) shall not have any duties or responsibilities except those
expressly set forth in this Credit Agreement and shall not be a trustee or
fiduciary for any Lender; (b) shall not be responsible to the Lenders for
any recital, statement, representation, or warranty (whether written or oral)
made in or in connection with any Credit Document or any certificate or other
document referred to or provided for in, or received by any of them under, any
Credit Document, or for the value, validity, effectiveness, genuineness,
enforceability, or sufficiency of any Credit Document, or any other document
referred to or provided for therein or for any failure by any Credit Party or
any other Person to perform any of its obligations thereunder; (c) shall
not be responsible for or have any duty to ascertain, inquire into, or verify
the performance or observance of any covenants or agreements by any Credit
Party or the satisfaction of any condition or to inspect the property (including
the books and records) of any Credit Party or any of its Subsidiaries or
Affiliates; and (d) shall not be responsible for any action taken or
omitted to be taken by it under or in connection with any Credit Document,
except for its own gross negligence or willful misconduct.  The Agent may employ agents and
attorneys-in-fact and shall not be responsible for the negligence or misconduct
of any such agents or attorneys-in-fact selected by it with reasonable care.


 


10.2        Reliance by Agent.


 


The Agent shall be entitled to rely upon any certification, notice,
instrument, writing, or other communication (including, without limitation, any
thereof by telephone or telecopy) believed by it to be genuine and correct and
to have been signed, sent or made by or on behalf of the proper Person or
Persons, and upon advice and statements of legal counsel (including counsel for
any Credit Party), independent accountants, and other experts selected by the
Agent.  The Agent may deem and treat the
payee of any Note as the holder thereof for all purposes hereof unless and
until the Agent receives and accepts an Assignment and Assumption executed in
accordance with Section 11.3(b) hereof. 
As to any matters not expressly provided for by this Credit Agreement,
the Agent shall not be required to exercise any discretion or take any action,
but shall be required to act or to refrain from acting (and shall be fully
protected in so acting or refraining from acting) upon the instructions of the
Required Revolving


 


76

















 


Lenders, and such instructions shall be binding on all of the Lenders; provided,
however, that the Agent shall not be required to take any action that
exposes the Agent to personal liability or that is contrary to any Credit
Document or applicable law or unless it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking any such action.


 


10.3        Defaults.


 


The Agent shall not be deemed to have knowledge or notice of the
occurrence of a Default or Event of Default unless the Agent has received
written notice from a Lender or a Credit Party specifying such Default or Event
of Default and stating that such notice is a “Notice of Default”.  In the event that the Agent receives such a
notice of the occurrence of a Default or Event of Default, the Agent shall give
prompt notice thereof to the Lenders. 
The Agent shall (subject to Section 10.2 hereof and the terms of
the Intercreditor Agreement) take such action with respect to such Default or
Event of Default as shall reasonably be directed by the Required Revolving
Lenders (or such other Lenders as required by Section 11.6), provided
that, unless and until the Agent shall have received such directions,
the Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it
shall deem advisable in the best interest of the Lenders (subject to the terms
of the Intercreditor Agreement).


 


10.4        Rights
as a Lender.


 


With respect to its Commitment and the Loans made by it, BOA (and any
successor acting as Agent) in its capacity as a Lender hereunder shall have the
same rights and powers hereunder as any other Lender and may exercise the same
as though it were not acting as the Agent, and the term “Lender” or “Lenders”
shall, unless the context otherwise indicates, include the Agent in its
individual capacity.  BOA (and any
successor acting as Agent) and its Affiliates may (without having to account
therefor to any Lender) accept deposits from, lend money to, make investments
in, provide services to, and generally engage in any kind of lending, trust, or
other business with any Credit Party or any of its Subsidiaries or Affiliates as
if it were not acting as Agent, and BOA (and any successor acting as Agent) and
its Affiliates may accept fees and other consideration from any Credit Party or
any of its Subsidiaries or Affiliates for services in connection with this
Credit Agreement or otherwise without having to account for the same to the
Lenders.


 


10.5        Indemnification.


 


The Lenders agree to indemnify the Agent (to the extent not reimbursed
under Section 11.5 hereof, but without limiting the obligations of the
Credit Parties under such Section) ratably (in accordance with their respective
Revolving Commitments (or, if the Revolving Commitments have been terminated,
the outstanding Revolving Loans and Participation Interests in Letters of
Credit (including the Participation Interests of the Issuing Lender in Letters
of Credit)) for any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses (including attorneys’
fees), or disbursements of any kind and nature whatsoever that may be imposed on,
incurred by or asserted against the Agent (including by any Lender) in any way
relating to or arising out of any Credit Document or the transactions
contemplated thereby or any action taken or omitted by the Agent under any
Credit Document; provided that no Lender shall be liable for any of the
foregoing to the extent they arise from the gross negligence or willful
misconduct of the Person to be indemnified. 
Without limitation of the foregoing, each Lender agrees to reimburse the
Agent promptly upon demand for its ratable share of any costs or expenses
payable by the Credit Parties under Section 11.5, to the extent that the
Agent is not promptly reimbursed for such costs and expenses by the Credit
Parties.  The agreements in this
Section 10.5 shall survive the repayment of the Loans, LOC Obligations and
other obligations under the Credit Documents and the termination of the
Commitments hereunder.


 


10.6        Non-Reliance
on Agent and Other Lenders.


 


Each Lender agrees that it has, independently and without reliance on
the Agent or any other Lender, and based on such documents and information as
it has deemed appropriate, made its own credit analysis of the Credit Parties
and their Subsidiaries and decision to enter into this Credit Agreement and
that it will, independently and without reliance upon the Agent or any other
Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under the Credit Documents.  Except for notices, reports, and other
documents and information expressly required to be


 


77

















 


furnished to the Lenders by the Agent hereunder, the Agent shall not
have any duty or responsibility to provide any Lender with any credit or other
information concerning the affairs, financial condition, or business of any
Credit Party or any of its Subsidiaries or Affiliates that may come into the
possession of the Agent or any of its Affiliates.


 


10.7        Successor
Agent.


 


The Agent may resign at any time by giving notice thereof to the
Lenders and the Credit Parties.  Upon
any such resignation, the Required Revolving Lenders shall have the right to
appoint a successor Agent.  If no
successor Agent shall have been so appointed by the Required Revolving Lenders
and shall have accepted such appointment within thirty (30) days after the
retiring Agent’s giving of notice of resignation, then the retiring Agent may,
on behalf of the Lenders, appoint a successor Agent which shall be a commercial
bank organized under the laws of the United States having combined capital and
surplus of at least $100,000,000.  Upon
the acceptance of any appointment as Agent hereunder by a successor, such
successor shall thereupon succeed to and become vested with all the rights,
powers, discretion, privileges, and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations
hereunder.  After any retiring Agent’s
resignation hereunder as Agent, the provisions of this Section 10 shall
continue in effect for its benefit in respect of any actions taken or omitted
to be taken by it while it was acting as Agent.  If no successor Agent has accepted appointment as Agent under
this Credit Agreement by the date which is 30 days following a retiring Agent’s
notice of resignation, the retiring Agent’s resignation shall nevertheless
thereupon become effective and the Lenders shall perform all the duties of the
Agent hereunder until such time, if any, as the Required Lenders appoint a
successor agent as provided for above.


 


 


ARTICLE XI


 


MISCELLANEOUS


 


11.1        Notices.


 


Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device)
to the number set out below, (c) the Business Day following the day on
which the same has been delivered prepaid (or
pursuant to an invoice arrangement) to a reputable national overnight air
courier service, or (d) the third Business Day following the day on which
the same is sent by certified or registered mail, postage prepaid, in each case
to the respective parties at the address, in the case of the Credit Parties and
the Agent, set forth below, and, in the case of the Lenders, set forth on Schedule 2.1(a),
or at such other address as such party may specify by written notice to the
other parties hereto:


 


if to any Credit Party:


 


U.S. 
Restaurant Properties Operating, L.P.


c/o U.S.
Restaurant Properties, Inc.


12240 Inwood
Road, Suite 300


Dallas, TX 75244


Attn: 
Stacy M. Riffe, CFO


Telephone: (972) 387-1487, ext 112


Telecopy: (972) 490-9119


 


if to the Agent (for credit-related matters):


 


Bank of America,
N.A.


231 South
LaSalle Street


M/C:  IL1-231-10-35


Chicago, IL  60697


Attention:
Matthew W. Sadler, Vice President, Global Portfolio Management, Real Estate


Phone:  (312) 828-7107


Fax:  (312) 974-4970


E-mail:  matthew.w.sadler@bankofamerica.com


 


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and if to the Agent (for administrative
matters):


 


Bank of America,
N.A.


231 South
LaSalle Street


Mail code:  IL1-231-10-30


Chicago, IL
60697


Attention:
Charlene E. Wright-Jones, Assistant Vice President


Phone:  312-828-4160


Fax:  312-828-3950


E-mail:  charlene.wright-jones@bankofamerica.com


 


and if to the Agent (for agency matters):


 


Ramon Garcia


Agency Management Officer


GGIB Agency Management Central


Bank of America


901 Main St.


Dallas, TX 
75202-3714


Telephone: 
(214) 209-4126


Fax:         (214)
290-9520


E-mail:    ramon.garcia@bankofamerica.com


 


11.2        Right
of Set-Off; Adjustments.


 


Upon the occurrence and during the continuance of any Event of Default,
each Lender (and each of its Affiliates) is hereby authorized (subject to the
terms and conditions of the Intercreditor Agreement) at any time and from time
to time, to the fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held and other indebtedness at any time owing by such Lender (or any of
its Affiliates) to or for the credit or the account of any Credit Party against
any and all of the obligations of such Person now or hereafter existing under
this Credit Agreement, under the Notes, under any other Credit Document or
otherwise, irrespective of whether such Lender shall have made any demand
hereunder or thereunder and although such obligations may be unmatured.  Each Lender agrees promptly to notify any
affected Credit Party after any such set-off and application made by such
Lender; provided, however, that the failure to give such notice
shall not affect the validity of such set-off and application.  The rights of each Lender under this
Section 11.2 are in addition to other rights and remedies (including, without
limitation, other rights of set-off) that such Lender may have.


 


11.3        Successors and Assigns.


 


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


 


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(b)           Any Lender may at
any time assign to one or more Eligible Assignees all or a portion of its
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans at the time owing to it); provided that (i)
except in the case of an assignment of the entire remaining amount of the
assigning Lender’s Commitment and the Loans at the time owing to it or in the
case of an assignment to a Lender or an Affiliate of a Lender or an Approved
Fund with respect to a Lender, the aggregate amount of the Commitment (which
for this purpose includes Loans outstanding thereunder) or, if the applicable
Commitment is not then in effect, the principal outstanding balance of the Loan
of the assigning Lender subject to each such assignment (determined as of the
date the Assignment and Assumption with respect to such assignment is delivered
to the Agent or, if “Trade Date” is specified in the Assignment and Assumption,
as of the Trade Date) shall not be less than $2,500,000, unless each of the
Agent and, so long as no default or Event of Default has occurred and is
continuing hereunder or any other Credit Document, the Borrower otherwise
consent (each such consent not to be unreasonably withheld or delayed); (ii)
each partial assignment shall be made as an assignment of a proportionate part
of all the assigning Lender’s rights and obligations under this Agreement with
respect to the Loan or the Commitment assigned; (iii) any assignment of a
Revolving Commitment must be approved by the Agent and the Issuing Lender
unless the Person that is the proposed assignee is itself a Lender with a
Revolving Commitment (whether or not the proposed assignee would otherwise
qualify as an Eligible Assignee); and (iv) the parties to each assignment shall
execute and deliver to the Agent an Assignment and Assumption and an ICA
Joinder Agreement, together with a processing and recordation fee of $3,500,
and the Eligible Assignee, if it shall not be a Lender, shall deliver to the
Agent an Administrative Questionnaire. 
Subject to acceptance and recording thereof by the Agent pursuant to
paragraph (c) of this Section, from and after the effective date specified in
each Assignment and Assumption, the Eligible Assignee thereunder shall be a
party to this Agreement and, to the extent of the interest assigned by such
Assignment and Assumption, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall
continue to be entitled to the benefits of Sections 3.6 through 3.12  with
respect to facts and circumstances occurring prior to the effective date of
such assignment.  Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does
not comply with this paragraph shall be treated for purposes of this Agreement
as a sale by such Lender of a participation in such rights and obligations in
accordance with paragraph (d) of this Section.


 


(c)           The Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amounts of the
Loans owing to, each Lender pursuant to the terms hereof from time to time (the
“Register”).  The entries in the
Register shall be conclusive, and the Borrower, the Agent and the Lenders may
treat each Person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. 
The Register shall be available for inspection by the Borrower and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice.


 


(d)           Any Lender may at any time, without the consent of, or
notice to, the Borrower or the Agent, sell participations (in minimum amounts
of not less than $2,500,000) to any Person (other than a natural person, the
Borrower or any of the Credit Parties or any of the Borrower’s or any Credit
Party’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a
portion of such Lender’s rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans owing to it); provided
that (i) such Lender’s obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (iii) the
Borrower, the Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.  Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any  provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, modification or
waiver described in Section 11.6 that affects such Participant.  Subject to paragraph (e) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits of
Sections 3.6 through 3.12  to the same extent as if it were a Lender
and had acquired its interest by assignment pursuant to paragraph (b) of this
Section.  To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 11.2 as
though it were a Lender, provided such


 


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Participant agrees to be subject to Sections 3.14 and 3.15 and the
Intercreditor Agreement as though it were a Lender.


 


(e)           A Participant shall not be entitled to receive any greater
payment under Sections 3.6 through 3.12  than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with the Borrower’s prior written consent. 
A Participant that would be a Foreign Lender if it were a Lender shall
not be entitled to the benefits of Section 3.11 unless the Borrower is
notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 3.11 as though
it were a Lender.


 


(f)            Any Lender may
at any time pledge or assign a security interest in all or any portion of its
rights under this Agreement to secure obligations of such Lender, including
without limitation any pledge or assignment to secure obligations to a Federal
Reserve Bank; provided that no such pledge or assignment shall release
such Lender from any of its obligations hereunder or substitute any such
pledgee or assignee for such Lender as a party hereto.


 


11.4        No
Waiver; Remedies Cumulative.


 


No failure or delay on the part of the Agent or any Lender in
exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between the Agent or any Lender and any of
the Credit Parties shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege hereunder or under any other Credit
Document preclude any other or further exercise thereof or the exercise of any
other right, power or privilege hereunder or thereunder.  The rights and remedies provided herein are
cumulative and not exclusive of any rights or remedies which the Agent or any
Lender would otherwise have.  No notice
to or demand on any Credit Party in any case shall entitle the Credit Parties
to any other or further notice or demand in similar or other circumstances or
constitute a waiver of the rights of the Agent or the Lenders to any other or
further action in any circumstances without notice or demand.


 


11.5        Expenses; Indemnification.


 


(a)           The
Credit Parties jointly and severally agree to pay on demand all costs and
expenses of the Agent in connection with the syndication, preparation,
execution, delivery, administration, modification, and amendment of this Credit
Agreement, the other Credit Documents, and the other documents to be delivered
hereunder, including, without limitation, the reasonable fees and expenses of
counsel for the Agent (including the cost of internal counsel) with respect
thereto and with respect to advising the Agent as to its rights and
responsibilities under the Credit Documents. 
The Credit Parties further jointly and severally agree to pay on demand
all costs and expenses of the Agent and the Lenders, if any (including, without
limitation, reasonable attorneys’ fees and expenses and the cost of internal
counsel), in connection with any work-out or restructuring relating to the
Credit Facility or any enforcement (whether through negotiations, legal
proceedings, or otherwise) of any of the Credit Documents.


 


(b)           The
Credit Parties jointly and severally agree to indemnify and hold harmless the
Agent and each Lender and each of their Affiliates and their respective
officers, directors, employees, agents, and advisors (each, an “Indemnified
Party”) from and against any and all claims, damages, losses, liabilities,
costs, and expenses (including, without limitation, reasonable attorneys’ fees)
that may be incurred by or asserted or awarded against any Indemnified Party,
in each case arising out of or in connection with or by reason of (including,
without limitation, in connection with any investigation, litigation, or
proceeding or preparation of defense in connection therewith) the Credit
Documents, any of the transactions contemplated herein or the actual or
proposed use of the proceeds of the Loans, except to the extent such claim,
damage, loss, liability, cost, or expense is found in a final, non-appealable
judgment by a court of competent jurisdiction to have resulted from such
Indemnified Party’s gross negligence or willful misconduct.  In the case of an investigation, litigation
or other proceeding to which the indemnity in this Section 11.5 applies,
such indemnity shall be effective whether or not such investigation, litigation
or proceeding is brought by any of the Credit Parties, their respective
directors, shareholders or creditors or an Indemnified Party or any other
Person or any Indemnified Party is otherwise a party thereto and whether or not
the transactions contemplated hereby are consummated.  The Credit Parties agree not to assert any claim against the
Agent,


 


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any Lender, any of their Affiliates, or any of their respective
directors, officers, employees, attorneys, agents, and advisers, on any theory
of liability, for special, indirect, consequential, or punitive damages arising
out of or otherwise relating to the Credit Documents, any of the transactions
contemplated herein or the actual or proposed use of the proceeds of the Loans.


 


(c)           Without
prejudice to the survival of any other agreement of the Credit Parties
hereunder, the agreements and obligations of the Credit Parties contained in
this Section 11.5 shall survive the repayment of the Loans, LOC
Obligations and other obligations under the Credit Documents and the
termination of the Commitments hereunder.


 


11.6        Amendments,
Waivers and Consents.


 


(a)           Neither
this Credit Agreement nor any other Credit Document nor any of the terms hereof
or thereof may be amended, deleted or otherwise changed unless such amendment,
deletion or change is in writing entered into by, or approved in writing by,
each of the Credit Parties party thereto and the Required Lenders, provided,
however, that:


 


(i)            without the consent of each Lender
affected thereby (in addition to Required Lender consent), neither this Credit
Agreement nor any other Credit Document may be amended, deleted or otherwise
changed so as to:


 


(A)          extend any Commitment or the final
maturity of any Loan or of any reimbursement obligation, or any portion
thereof, arising from drawings under Letters of Credit, or extend any payment
due (or to be due) in connection with any Loan, or any portion thereof,


 


(B)           reduce the rate or extend the time of
payment of interest on any Loan or of any reimbursement obligation, or any
portion thereof, arising from drawings under Letters of Credit (subject to the
right of the Required Revolving Lenders to waive the applicability of any
post-default increase in interest rates pursuant to Section 11.6(b) below) or
of any Fees,


 


(C)           reduce the principal amount of any
Loan or of any reimbursement obligation, or any portion thereof, arising from
drawings under Letters of Credit,


 


(D)          increase the Commitment of a Lender
over the amount thereof in effect (it being understood and agreed that a waiver
of any condition precedent set forth in Section 5.2 or of any Default or
Event of Default or mandatory reduction in the Commitments shall not constitute
a change in the terms of any Commitment of any Lender),


 


(E)           except as the result of or in
connection with a dissolution, merger or disposition of a Consolidated Party
not prohibited by Section 8.4 or Section 8.5, release the Borrower or
substantially all of the other Credit Parties from its or their obligations
under the Credit Documents,


 


(F)           amend or modify any provision of this
Section 11.6,


 


(G)           reduce any percentage specified in,
or otherwise modify, the definition of Required Lenders or Required Revolving
Lenders, or


 


(H)          consent to the assignment or transfer
by the Borrower or any of the other Credit Parties of all or substantially all
of their rights and obligations under (or in respect of) the Credit Documents
except as permitted thereby;


 


(ii)           without the consent of the Agent, no
provision of Section 10 may be amended, deleted or otherwise changed;


 


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(iii)          without the consent of the Issuing
Lender, no provision of Section 2.2 may be amended, deleted or otherwise
changed; and


 


(iv)          provisions contained in this Credit
Agreement and in the Credit Documents pertaining to purely ministerial or administrative
matters may be amended, deleted or otherwise changed upon the obtaining of the
written consent of the Credit Parties and Required Revolving Lenders
(regardless of whether Required Lender consent is obtained) to the extend such
amendments, deletions and/or other changes do not, in the judgment of the
Collateral Agent, materially and adversely effect the rights, remedies or
expected financial return of the Term Loan Lenders.


 


Notwithstanding the fact that the consent of
all the Lenders is required in certain circumstances as set forth above,
(x) each Lender is entitled to vote as such Lender sees fit on any
bankruptcy reorganization plan that affects the Loans, and each Lender
acknowledges that the provisions of Section 1126(c) of the Bankruptcy Code
supersedes the unanimous consent provisions set forth herein and (y) the
Required Lenders shall, subject to the terms of the Intercreditor Agreement,
determine whether or not to allow a Credit Party to use cash collateral in the
context of a bankruptcy or insolvency proceeding and such determination shall
be binding on all of the Lenders.


 


(b)           None of the terms or conditions of
this Credit Agreement or of any of the other Credit Documents may be waived
without the written consent of the Required Revolving Lenders; provided,
however, that:


 


(i)            without the consent of each Lender
affected thereby, neither this Credit Agreement nor any other Credit Document
may be waived so as to (whether expressly or effectively):


 


(A)          extend any Commitment or the final maturity
of any Loan or of any reimbursement obligation, or any portion thereof, arising
from drawings under Letters of Credit (provided, that any waiver which has the
effect of extending the final maturity of any Loan or any such obligation shall
constitute an amendment requiring approval pursuant to clause (a) of this
Section 11.6), or otherwise waive any payment due (or to be due) in connection
with any Loan, or any portion thereof,


 


(B)           reduce the rate or extend the time of
payment of interest on any Loan or of any reimbursement obligation, or any
portion thereof, arising from drawings under Letters of Credit (other than as a
result of waiving the applicability of any post-default increase in interest
rates) or of any Fees,


 


(C)           waive the principal amount of any
Loan or of any reimbursement obligation, or any portion thereof, arising from
drawings under Letters of Credit,


 


(D)          increase the Commitment of a Lender
over the amount thereof in effect (it being understood and agreed that a waiver
of any condition precedent set forth in Section 5.2 or of any Default or
Event of Default or mandatory reduction in the Commitments shall not constitute
a change in the terms of any Commitment of any Lender),


 


(E)           except as the result of or in
connection with a dissolution, merger or disposition of a Consolidated Party
not prohibited by Section 8.4 or Section 8.5, release the Borrower or
substantially all of the other Credit Parties from its or their obligations
under the Credit Documents,


 


(F)           waive any provision of this
Section 11.6 (provided, that any such waiver shall, for purposes hereof,
constitute an amendment requiring approval pursuant to clause (a) of this
Section 11.6),


 


(G)           reduce any percentage specified in,
or otherwise modify, the definition of Required Lenders or Required Revolving
Lenders (provided, that any waiver having such an


 


83

















 


effect shall, for purposes hereof, constitute
an amendment requiring approval pursuant to clause (a) of this Section 11.6),
or


 


(H)          consent to the assignment or transfer
by the Borrower or any of the other Credit Parties of all or substantially all
of their rights and obligations under (or in respect of) the Credit Documents
except as permitted thereby;


 


(ii)           without the consent of the Agent, no
provision of Section 10 may be waived; and


 


(iii)          without the consent of the Issuing
Lender, no provision of Section 2.2 may be waived.


 


11.7        Counterparts.


 


This Credit Agreement may be executed in any number of counterparts,
each of which when so executed shall be an original, but all of which shall
constitute one and the same instrument. 
It shall not be necessary in making proof of this Credit Agreement to
produce or account for more than one such counterpart for each of the parties
hereto.  Delivery by facsimile by any of
the parties hereto of an executed counterpart of this Credit Agreement shall be
as effective as an original executed counterpart hereof and shall be deemed a
representation that an original executed counterpart hereof will be delivered.


 


11.8        Headings.


 


The headings of the sections hereof are provided for convenience only
and shall not in any way affect the meaning or construction of any provision of
this Credit Agreement.


 


11.9        Survival.


 


All indemnities set forth herein, including, without limitation, in
Section 2.2(i), 3.11, 3.12, 10.5 or 11.5 shall survive the execution and
delivery of this Credit Agreement, the making of the Loans, the issuance of the
Letters of Credit, the repayment of the Loans, LOC Obligations and other
obligations under the Credit Documents and the termination of the Commitments
hereunder, and all representations and warranties made by the Credit Parties
herein shall survive until this Credit Agreement shall be terminated in
accordance with the terms of Section 11.13(b).


 


11.10      Governing
Law; Submission to Jurisdiction; Venue.


 


(a)           THIS CREDIT AGREEMENT AND, UNLESS
OTHERWISE EXPRESSLY PROVIDED THEREIN, THE OTHER CREDIT DOCUMENTS AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NORTH
CAROLINA.  Any legal action or
proceeding with respect to this Credit Agreement or any other Credit Document
may be brought in the courts of the State of North Carolina in Mecklenburg
County, or of the United States for the Western District of North Carolina,
and, by execution and delivery of this Credit Agreement, each of the Credit
Parties hereby irrevocably accepts for itself and in respect of its property,
generally and unconditionally, the nonexclusive jurisdiction of such
courts.  Each of the Credit Parties
further irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to it at the address
set out for notices pursuant to Section 11.1, such service to become
effective three (3) days after such mailing.  Nothing herein shall affect the right of the Agent or any Lender
to serve process in any other manner permitted by law or to commence legal
proceedings or to otherwise proceed against any Credit Party in any other
jurisdiction.


 


(b)           Each of the Credit Parties hereby
irrevocably waives any objection which it may now or hereafter have to the
laying of venue of any of the aforesaid actions or proceedings arising out of
or in connection with this Credit Agreement or any other Credit Document
brought in the courts referred to in subsection (a) above and hereby
further irrevocably waives and agrees not to plead or claim in any such court
that any such action or proceeding brought in any such court has been brought
in an inconvenient forum.


 


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(c)           TO THE EXTENT PERMITTED BY LAW, EACH
OF THE AGENT, THE LENDERS, EACH OF THE CREDIT PARTIES HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING
OUT OF OR RELATING TO THIS CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS
OR THE TRANSACTIONS CONTEMPLATED HEREBY.


 


11.11      Severability.


 


If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.


 


11.12      Entirety.


 


This Credit Agreement together with the other Credit Documents
represent the entire agreement of the parties hereto and thereto, and supersede
all prior agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.


 


11.13      Binding
Effect; Termination.


 


(a)           This Credit Agreement shall become
effective at such time on or after the Closing Date when it shall have been
executed by each Credit Party and the Agent, and the Agent shall have received
copies hereof (telefaxed or otherwise) which, when taken together, bear the
signatures of each Lender, and thereafter this Credit Agreement shall be
binding upon and inure to the benefit of each Credit Party, the Agent and each
Lender and their respective successors and assigns.


 


(b)           The term of this Credit Agreement shall
be until the Credit Party Obligations are Fully Satisfied.


 


11.14      Confidentiality.


 


Each Lender Party agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to
its and its Affiliates’ directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority
(including any self-regulatory authority, such as the National Association of
Insurance Commissioners), (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party
hereto, (e) in connection with the exercise of any remedies hereunder or under
any other Credit Document or any action or proceeding relating to this
Agreement or any other Credit Document or the enforcement of rights hereunder
or thereunder, (f) subject to an agreement containing provisions substantially
the same as those of this Section, to (i) any assignee of or Participant in, or
any prospective assignee of or Participant in, any of its rights or obligations
under this Agreement or (ii) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to the Borrower and
its obligations, (g) with the consent of the Borrower or (h) to the extent such
Information (x) becomes publicly available other than as a result of a breach
of this Section or (y) becomes available to any Lender Party on a
nonconfidential basis from a source other than the Borrower.  For purposes of this Section, “Information”
means all information received from any Credit Party relating to any Credit
Party or any of their respective businesses, other than any such information
that is available to the Agent or any Lender on a nonconfidential basis prior
to disclosure by any Credit Party, provided that, in the case of information
received from a Credit Party after the date hereof, such information is clearly
identified at the time of delivery as confidential.  Any Person required to maintain the confidentiality of
Information as provided in this Section shall be considered to have complied
with its obligation to do so if such Person has exercised the same degree of
care to maintain the confidentiality of such Information as such Person would
accord to its own confidential information. Notwithstanding anything herein to
the contrary, “Information” shall not include, and the Borrower, the other
Credit Parties, the Lender Parties and the respective


 


85

















 


Affiliates of each of the foregoing (and the respective partners,
directors, officers, employees, agents, advisors and other representatives of
each of the foregoing and their Affiliates) may disclose to any and all
Persons, without limitation of any kind (a) any information with respect to the
U.S. federal and state income tax treatment of the transactions contemplated
hereby and any facts that may be relevant to understanding such tax treatment,
which facts shall not include for this purpose the names of the parties or any
other Person named herein, or information that would permit identification of
the parties or such other Persons, or any pricing terms or other nonpublic
business or financial information that is unrelated to such tax treatment or
facts, and (b) all materials of any kind (including opinions or other tax
analyses) relating to such tax treatment or facts that are provided to any of
the Persons referred to above.


 


11.15      Source of Funds.


 


Each of the Lenders hereby represents and warrants to the Borrower that
at least one of the following statements is an accurate representation as to
the source of funds to be used by such Lender in connection with the financing
hereunder:


 


(a)           no part of such funds constitutes
assets allocated to any separate account maintained by such Lender in which any
employee benefit plan (or its related trust) has any interest;


 


(b)           to the extent that any part of such
funds constitutes assets allocated to any separate account maintained by such
Lender, such Lender has disclosed to the Borrower the name of each employee
benefit plan whose assets in such account exceed 10% of the total assets of
such account as of the date of such purchase (and, for purposes of this
clause (b), all employee benefit plans maintained by the same employer or
employee organization are deemed to be a single plan);


 


(c)           to the extent that any part of such
funds constitutes assets of an insurance company’s general account, such
insurance company has complied with all of the requirements of the regulations
issued under Section 401(c)(1)(A) of ERISA; or


 


(d)           such funds constitute assets of one
or more specific benefit plans which such Lender has identified in writing to
the Borrower.


 


As used in this Section 11.15, the terms “employee benefit plan”
and “separate account” shall have the respective meanings assigned to such
terms in Section 3 of ERISA.


 


11.16      Regulation D.


 


Each of the Lenders hereby represents and warrants to the Borrower that
it is a commercial lender, other financial institution or other “accredited”
investor (as defined in SEC Regulation D) which makes or acquires or loans
on the ordinary course of business and that it will make or acquire Loans for
its own account in the ordinary course of business.


 


11.17      Conflict.


 


To the extent that there is a conflict or inconsistency between any
provision hereof, on the one hand, and any provision of any Credit Document, on
the other hand, this Credit Agreement shall control.


 


11.18      USA
Patriot Act Notice.


 


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


 


86

















 


[Remainder of Page Left Intentionally Blank –
Signature Pages, Schedules and Exhibits to Follow]


 


87

















 


IN
WITNESS WHEREOF, each of the parties hereto has caused
a counterpart of this Credit Agreement to be duly executed and delivered as of
the date first above written.


 


 


	
  PRINCIPAL BORROWER:

  	
   

  	
  U.S.  RESTAURANT  PROPERTIES OPERATING L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: 
  USRP MANAGING, INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  GENERAL SPE:

  	
   

  	
  USRP FUNDING 2002-A, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: 
  USRP (SFGP) 2, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  S&C:

  	
   

  	
  USRP (S&C), LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HCI:

  	
   

  	
  USRP/HCI PARTNERSHIP 1, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: 
  USRP (JV1), LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  JV1:

  	
   

  	
  USRP (JV1), LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  USRP Holding:

  	
   

  	
  USRP HOLDING CORP.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  GENERAL PARTNER:

  	
   

  	
  USRP MANAGING, INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
										



 

















 


	
  USRP REIT:

  	
   

  	
  U.S.  RESTAURANT PROPERTIES,
  INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SUBSIDIARY

  GUARANTORS:

  	
   

  	
  ARKANSAS RESTAURANTS #10, L.P., a Texas
  limited

  partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: North American Restaurant Management,
  Inc.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  RESTAURANT PROPERTY PARTNERS, L.P., a Texas

  limited partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: Restaurant Funding, Inc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (66), LTD., a Texas limited partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: USRP GP1, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (FAIN 10), L.P., a Texas limited
  partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: USRP GP5, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (KATY), L.P., a Texas limited
  partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: USRP GP8, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
										



 

















 


	
   

  	
   

  	
  USRP (PAC), L.P., a Texas limited
  partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: USRP (Cap), Inc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (QUEST), L.P., a Texas limited
  partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: USRP GP4, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (SAN ANTONIO), LTD., a Texas limited
  partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: USRP GP, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (T&C), L.P., a Texas limited
  partnership

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: USRP GP3, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BULLDOG MANAGEMENT, INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  NORTH AMERICAN RESTAURANT MANAGEMENT,

  INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  RESTAURANT FUNDING, INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
										



 

















 


	
   

  	
   

  	
  PINNACLE RESTAURANT GROUP, LLC, a Texas

  limited liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (ACQUISITION), LLC, a Texas limited
  liability

  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (BC), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (BILL), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (CAL), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (CAP), INC. a Texas corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (CARROLL), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (CENTRAL AVENUE), LLC, a Texas limited

  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (CHRIS), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
										



 

















 


	
   

  	
   

  	
  USRP (DEEDEE), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (DON), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (FINANCE), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (FRED), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (GANT1), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (GANT2), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (GOLD), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP GP, LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP GP1, LLC, a Texas limited liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
										



 

















 


	
   

  	
   

  	
  USRP GP3, LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP GP4, LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP GP5, LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP GP6, LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP GP7, LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP GP8, LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (ILLINOIS), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (JENNIFER), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (JONES), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
										



 

















 


	
   

  	
   

  	
  USRP (JV2), LLC, a Texas limited liability
  company(1)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (MANAGER), LLC, a Texas limited
  liability

  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (MIDON), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (MINNESOTA), LLC, a Texas limited
  liability

  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (MISSOURI), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (MOLLY), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (PALMA), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (PAT), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
										



 












(1) 
NOTE – ALTHOUGH INCLUDED IN THE EXECUTED SIGNATURE PAGES OF THE
DOCUMENT, THE JV2 ENTITY HAS BEEN DELETED AS A GUARANTOR – IT IS NOT A
CONSOLIDATED PARTY AND WAS INCLUDED BY THE BORROWER IN ITS LIST OF SUNSIDIARY
GUARANTORS IN ERROR


 

















 


	
   

  	
   

  	
  USRP (POPEYE’S), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (RIBBIT), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (SARAH), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (ST.  LOUIS), LLC, a
  Texas limited liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (STEVE), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (SUSI), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (SYBRA), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (VALERIE), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
										



 

















 


	
   

  	
   

  	
  PINNACLE RESTAURANT GROUP II, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (CAROLINA), LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Restaurant Acquisition Corp.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (LINCOLN), LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Restaurant Acquisition Corp.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (NORMAN), LTD.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Restaurant Acquisition Corp.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  U.S. RESTAURANT PROPERTIES DEVELOPMENT

  L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: 
  Restaurant Contractor Corp.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  RESTAURANT RENOVATION PARTNERS, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: Restaurant Acquisition Corp.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  RESTAURANT ACQUISITION CORP.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
										



 

















 


	
   

  	
   

  	
  RESTAURANT CONTRACTOR CORP.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP RENOVATION CORP.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (Green), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (Martin), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (SFGP)2, LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (SHOPORT)1, LLC, a Texas limited
  liability

  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (Warren), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (KRUSE), LLC, a Texas limited liability
  company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (PETERS), LLC, a Texas limited
  liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
										



 

















 


	
   

  	
   

  	
  USRP (ADAMS), L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: 
  USRP GP7, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (Maier), L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: 
  USRP GP6, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (SHO)1, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: 
  USRP (SHOPORT)1, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stacy M. Riffe

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Officer

  	
   

  
										



 


[remainder of page left intentionally blank –
additional signature pages, schedules and exhibits to follow]


 

















 


AGENT/ISSUING
LENDER/COLLATERAL AGENT:


 


BANK OF AMERICA, N.A., in its capacity as Agent, Issuing Lender and
Collateral Agent


 


 


	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  LENDERS:

  	
   

  	
  BANK OF AMERICA, N.A.
individually in its capacity as a

  Lender

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
										



 

















 


Schedule
1.1(a)


 


Revolving Commitments


 


 


	
  Lender

  	
   

  	
  Revolving
  Committed Amount

  	
   

  	
  Revolving
  Commitment Percentage

  	
   

  
	
  1. Bank of America, N.A.

  	
   

  	
  $

  	
  30,000,000

  	
   

  	
   

  	
  %

  
	
  2.

  	
   

  	
   

  	
   

  	
   

  	
  %

  
	
  Totals:

  	
   

  	
  $

  	
   

  	
   

  	
  100.00

  	
  %

  



 

















 


Schedule 2.1(a)


 


LENDER ADDRESSES AND
COMMITMENTS


 


 


Lender/Agent:


 


Bank of America, N.A.


(for credit-related matters):


 


Matthew W.
Sadler


Vice President


Global Portfolio
Management, Real Estate


Bank of America,
N.A.


231 South
LaSalle Street


M/C:  IL1-231-10-35


Chicago, IL  60697


Phone:  (312) 828-7107


Fax:  (312) 974-4970


E-mail:  matthew.w.sadler@bankofamerica.com


 


(for administrative matters):


 


Charlene E.
Wright-Jones


Assistant Vice
President


Bank of America,
N.A.


231 South
LaSalle Street


Mail code:  IL1-231-10-30


Chicago, IL
60697


Phone:  312-828-4160


Fax:  312-828-3950


E-mail:  charlene.wright-jones@bankofamerica.com


 


Other
Lenders:


 


2

















 


Exhibit 2.1(b)(i)


 


FORM OF NOTICE OF BORROWING


 


Renona Chinwendu


Bank of America Plaza


901 Main St., Mail Code TX1-492-14-05


Dallas, TX 75202-3714


Phone: (214) 209-2136


Fax: (214) 290-9484


 


Ladies and Gentlemen:


 


The undersigned, U.S. 
RESTAURANT  PROPERTIES OPERATING,
L.P., as the Principal Borrower thereunder (the “Borrower”), refers to
the Credit Agreement dated as of November 4, 2003 (as amended, modified,
restated or supplemented from time to time, the “Credit Agreement”),
among the Borrower, the other borrowers named therein, the Guarantors, the
Lenders and Bank of America, N.A., as Agent. 
Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement.  The Borrower hereby gives notice pursuant to
Section 2.1 of the Credit Agreement that it requests a Revolving Loan
advance under the Credit Agreement, and in connection therewith sets forth
below the terms on which such Loan advance is requested to be made:


 


	
  [(A)

  	
   

  	
  Date of Borrowing (which is a Business Day)

  	
   

  	
  ]*

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [(B)

  	
   

  	
  Principal Amount of Borrowing

  	
   

  	
  ]*

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (C)

  	
   

  	
  Interest rate basis

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (D)

  	
   

  	
  Interest Period and the last day thereof

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (E)

  	
   

  	
  Purpose of borrowing

  	
   

  	
   

  



 


In accordance with the requirements of Section 5.2, the Borrower
hereby reaffirms the representations and warranties set forth in the Credit
Agreement as provided in clause (b) of such Section, and confirms that the
matters referenced in clauses (c), (d) and (e) of such Section, are true
and correct.  The Borrower hereby
covenants and agrees to use the proceeds of the borrowing requested above
solely for those purposes expressly permitted pursuant to Sections 6.15 and 7.9
of the Credit Agreement.


 


	
   

  	
  U.S. 
  RESTAURANT  PROPERTIES OPERATING,
  L.P.,

  as Principal Borrower

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						



 


3

















 


Exhibit 2.1(e)


 


FORM OF REVOLVING NOTE


 


	
  $__________

  	
  , 2003

  



 


 


FOR VALUE RECEIVED, U.S. RESTAURANT PROPERTIES OPERATING, L.P., a
Delaware corporation, USRP FUNDING 2002-A, L.P., a Texas limited partnership,
USRP (S&C), LLC, a Texas limited liability company, USRP (JV1), LLC, a
Texas limited liability company, USRP/HCI PARTNERSHIP 1, L.P., a Texas limited
partnership and USRP Holding Corp., a Texas corporation (collectively, the “Borrower”),
hereby promise to pay to the order of
                                                  ,
its successors and assigns (the “Lender”), at the office of Bank of
America, N.A., as Agent (the “Agent”), at  231 South LaSalle Street, Mail
code:  IL1-231-10-30, Chicago, IL 60697
(or at such other place or places as the holder hereof may designate), at the
times set forth in the Credit Agreement dated as of November 4, 2003 among the
Borrower, the Guarantors, the Lenders and the Agent (as it may be as amended,
modified, restated or supplemented from time to time, the “Credit Agreement”;
all capitalized terms not otherwise defined herein shall have the meanings set
forth in the Credit Agreement), but in no event later than the Maturity Date,
in Dollars and in immediately available funds, the principal amount of
                                  DOLLARS
($                       )
or, if less than such principal amount, the aggregate unpaid principal amount
of all Revolving Loans made by the Lender to the Borrower pursuant to the
Credit Agreement, and to pay interest from the date hereof on the unpaid
principal amount hereof, in like money, at said office, on the dates and at the
rates selected in accordance with Section 2.1(d) of the Credit Agreement.


 


Upon the occurrence and during the continuance of an Event of Default,
the balance outstanding hereunder shall bear interest as provided in
Section 3.1 of the Credit Agreement. 
Further, in the event the payment of all sums due hereunder is
accelerated under the terms of the Credit Agreement, this Note, and all other
indebtedness of the Borrower to the Lender shall become immediately due and
payable, without presentment, demand, protest or notice of any kind, all of
which are hereby waived by the Borrower.


 


In the event this Note is not paid when due at any stated or
accelerated maturity, the Borrower agrees to pay, in addition to the principal
and interest, all costs of collection, including reasonable attorneys’ fees.


 


This Note and the Loans evidenced hereby may be transferred in whole or
in part only by registration of such transfer on the Register maintained by or
on behalf of the Borrower as provided in Section 11.3(c) of the Credit
Agreement.


 


 


[remainder of page left intentionally
blank – signature page to follow]


 


4

















 


IN WITNESS WHEREOF, the Borrower has caused this Note to be duly
executed by its duly authorized officer as of the day and year first above
written.


 


	
  BORROWER:

  	
   

  	
  U.S.  RESTAURANT  PROPERTIES OPERATING, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  USRP MANAGING, INC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP FUNDING 2002-A, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  USRP (SFGP) 2, LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (S&C), LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  USRP Holding Corp.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP/HCI PARTNERSHIP 1, L.P.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  USRP (JV1), LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP (JV1), LLC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  USRP HOLDING CORP.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
											



 


5

















 


Exhibit 3.2


 


FORM OF NOTICE OF CONTINUATION/CONVERSION


 


Ramon
Garcia


Agency
Management Officer


GGIB
Agency Management Central


Bank
of America


901
Main St.


Dallas,
TX  75202-3714


Telephone:  (214) 209-4126


Fax:         (214) 290-9520


 


Ladies and Gentlemen:


 


The undersigned, U.S. 
RESTAURANT  PROPERTIES OPERATING,
L.P., as principal borrower thereunder (the “Borrower”), refers to the
Credit Agreement dated as of November 4, 2003 (as amended, modified, restated
or supplemented from time to time, the “Credit Agreement”), among the
Borrower, the other borrowers named therein, the Guarantors, the Lenders and Bank
of America, N.A., as Agent.  Capitalized
terms used herein and not otherwise defined herein shall have the meanings
assigned to such terms in the Credit Agreement.  The Borrower hereby gives notice pursuant to Section 3.2 of
the Credit Agreement that it requests an continuation or conversion of a
Revolving Loan outstanding under the Credit Agreement, and in connection
therewith sets forth below the terms on which such extension or conversion is
requested to be made:


 


	
  (A)

  	
   

  	
  Loan Type

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (B)

  	
   

  	
  Date of Extension or Conversion

  (which is the last day of the

  the applicable Interest Period)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (C)

  	
   

  	
  Principal Amount of Extension or Conversion

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (D)

  	
   

  	
  Interest rate basis

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (E)

  	
   

  	
  Interest Period and the last day thereof

  	
   

  	
   

  	
   

  



 


In accordance with the requirements of Section 5.2, the Borrower
hereby reaffirms the representations and warranties set forth in the Credit
Agreement as provided in clause (b) of such Section, and confirms that the
matters referenced in clauses (c), (d) and (e) of such Section, are true
and correct.


 


The undersigned officer of U.S. Restaurant Properties Operating L.P.
hereby represents and warrants that he/she has the necessary power and
authority to execute this letter on behalf of the Borrower and that such action
has been duly authorized by all necessary action of the Borrower and its
partners prior to or on the date hereof.


 


	
   

  	
  U.S. 
  RESTAURANT  PROPERTIES
  OPERATING, L.P.,

  as Principal Borrower

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						



 


6

















 


Exhibit 7.1(c)


 


FORM OF OFFICER’S COMPLIANCE CERTIFICATE


 


For the fiscal
quarter ended
                             , 20       .


 


I,                                                 ,
[Title] of U.S.  RESTAURANT  PROPERTIES OPERATING, L.P., as principal
borrower (the “Borrower”) hereby certify that, to the best of my
knowledge and belief, with respect to that certain Credit Agreement dated as of
November 4, 2003 (as amended, modified, restated or supplemented from time to
time, the “Credit Agreement”; all of the defined terms in the Credit
Agreement are incorporated herein by reference) among the Borrower, the
Guarantors, the Lenders and Bank of America, N.A., as Agent:


 


a.                                       The
company-prepared financial statements which accompany this certificate are true
and correct in all material respects and have been prepared in accordance with
GAAP applied on a consistent basis, subject to changes resulting from normal
year-end audit adjustments.


 


b.                                      Since
                       
(the date of the last similar certification, or, if none, the Closing Date) no
Default or Event of Default has occurred under the Credit Agreement; and


 


c.                                       Since
                       
(the date of the last similar certification, or, if none, the Closing Date) the
Consolidated Parties have entered into the following Hedging Agreements:


 


 


 


Delivered herewith are detailed calculations demonstrating compliance
by the Credit Parties with the Financial Covenants as of the end of the fiscal
period referred to above.


 


This            
day of
                     , 20      .


 


 


	
   

  	
  U.S. 
  RESTAURANT  PROPERTIES
  OPERATING, L.P.,

  as Principal Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						



 


7

















 


Attachment to
Officer’s Certificate


 


Computation of Financial Covenants


 


8

















 


Exhibit 7.12


 


FORM OF JOINDER AGREEMENT


 


THIS
JOINDER AGREEMENT (the “Agreement”), dated as
of
                        , 20     ,
is by and between                                                ,
a
                                       
(the “Subsidiary”), and BANK OF AMERICA, N. 
A., in its capacity as Agent under that certain Credit
Agreement (as it may be amended, modified, restated or supplemented from time
to time, the “Credit Agreement”), dated as of November 4, 2003, by and
among U.S. RESTAURANT PROPERTIES OPERATING L.P., a Delaware limited partnership
(“USRP Operating” or the “Principal Borrower”), USRP FUNDING
2002-A, L.P., a Texas limited partnership (the “General SPE”); USRP
(S&C), LLC, a Texas limited liability company (“S&C”), USRP
(JV1), LLC, a Texas limited liability company (“JV1”), USRP/HCI
PARTNERSHIP 1, L.P., a Texas limited partnership (“HCI”), USRP HOLDING
CORP., a Texas corporation (“USRP Holding”; and together with the
Principal Borrower, the General SPE, HCI, JV1 and S&C, the “Borrower”),
the Guarantors, the Lenders and BANK OF AMERICA, N.A., as Agent.  All of the defined terms in the Credit
Agreement are incorporated herein by reference.


 


The Credit Parties are required by Section 7.12 of the Credit
Agreement to cause the Subsidiary to become a “Guarantor”.


 


Accordingly, the Subsidiary hereby agrees as follows with the Agent,
for the benefit of the Lenders:


 


1.             The Subsidiary
hereby acknowledges, agrees and confirms that, by its execution of this Credit
Agreement, the Subsidiary will be deemed to be a party to the Credit Agreement
and a “Guarantor” for all purposes of the Credit Agreement, and shall have all
of the obligations of a Guarantor thereunder as if it had executed the Credit
Agreement.  The Subsidiary hereby
ratifies, as of the date hereof, and agrees to be bound by, all of the terms,
provisions and conditions applicable to the Guarantors contained in the Credit
Agreement.  Without limiting the
generality of the foregoing terms of this paragraph 1, the Subsidiary hereby
jointly and severally together with the other Guarantors, guarantees to each
Lender and the Agent, as provided in Section 4 of the Credit Agreement,
the prompt payment and performance of the Credit Party Obligations in full when
due (whether at stated maturity, as a mandatory prepayment, by acceleration or
otherwise) strictly in accordance with the terms thereof.


 


2.             The address of the
Subsidiary for purposes of all notices and other communications is
                          ,
                                               ,
Attention of                            
(Facsimile No.
                              ).


 


3.             The Subsidiary
hereby waives acceptance by the Agent and the Lenders of the guaranty by the
Subsidiary under Section 4 of the Credit Agreement upon the execution of
this Credit Agreement by the Subsidiary.


 


4.             This Credit
Agreement may be executed in two or more counterparts, each of which shall
constitute an original but all of which when taken together shall constitute
one contract.


 


5.             This Credit
Agreement shall be governed by and construed and interpreted in accordance with
the laws of the State of North Carolina.


 


IN WITNESS WHEREOF, the Subsidiary has caused this Joinder Agreement to
be duly executed by its authorized officers, and the Agent, for the benefit of
the Lenders, has caused the same to be accepted by its authorized officer, as
of the day and year first above written.


 


	
   

  	
   

  	
   

  	
   

  	
  [SUBSIDIARY]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Acknowledged and accepted:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  BANK OF AMERICA, N.  A., as Agent

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
											



 


9

















 


Exhibit 11.3(b)


 


 


ASSIGNMENT AND ASSUMPTION


 


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


 


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


 


	
  1.

  	
   

  	
  Assignor:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  Assignee:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  [and is an Affiliate/Approved Fund of [identify
  Lender](2)]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Borrower(s):

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  Agent:

  	
   

  	
   

  	
  , as the agent under the Credit Agreement

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  Credit Agreement:

  	
   

  	
  That certain Credit Agreement dated as of
  November 4, 2003 among U.S. Restaurant Operating, L.P., USRP Funding 2002-A,
  L.P., as the Principal Borrower, the other Borrowers thereunder, the
  Guarantors referenced therein, the Lenders parties thereto, Bank of America,
  N.A., as Agent, and the other agents parties thereto.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  Assigned Interest:

  	
   

  	
   

  
							



 


	
  Facility
  Assigned(3)

  	
   

  	
  Aggregate Amount of

  Commitment/Loans for all

  Lenders*

  	
   

  	
  Amount of 

  Commitment/Loans

  Assigned*

  	
   

  	
  Percentage Assigned of

  Commitment/Loans(4)

  	
   

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  %

  



 















(2) Select as applicable.





(3) Fill in the appropriate terminology for the types of
facilities under the Credit Agreement that are being assigned under this
Assignment (e.g. “Revolving Credit Commitment,” “Term Loan Commitment,” etc.)


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


(4) Set forth, to at least 9
decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.


 


10















 


[7.           Trade Date:                                        ](5)


 


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


 


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


 


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  ASSIGNOR

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [NAME OF
  ASSIGNOR]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  ASSIGNEE

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  [NAME OF
  ASSIGNEE]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  
												



Consented to
and Accepted:


 


	
  BANK OF
  AMERICA, N.A., as Agent

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  
	
    Title:

  	
   

  
	
   

  	
   

  
	
  Consented
  to:

  	
   

  
	
   

  	
   

  
	
  U.S.  RESTAURANT  PROPERTIES OPERATING, L.P. 
  ,

  as Principal Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
					



 










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


 


11















 


ANNEX 1


 


STANDARD TERMS AND CONDITIONS FOR


ASSIGNMENT AND ASSUMPTION


 


1.  Representations and
Warranties.


 


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


 


1.2.  Assignee.  The Assignee (a) represents and warrants
that (i) it has full power and authority, and has taken all action necessary,
to execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Lender under the Credit
Agreement, (ii) it meets all requirements of an Eligible Assignee under the
Credit Agreement (subject to receipt of such consents as may be required under
the Credit Agreement), (iii) from and after the Closing Date, it shall be bound
by the provisions of the Credit Agreement as a Lender thereunder and, to the
extent of the Assigned Interest, shall have the obligations of a Lender
thereunder, (iv) it has received a copy of the Credit Agreement, together with
copies of the most recent financial statements delivered pursuant to the terms
thereof, as applicable, and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Assumption and to purchase the Assigned Interest on the
basis of which it has made such analysis and decision independently and without
reliance on the Agent or any other Lender, and (v) if it is a Foreign
Lender(6), attached to the Assignment and Assumption is any documentation
required to be delivered by it pursuant to the terms of the Credit Agreement,
duly completed and executed by the Assignee; and (b) agrees that (i) it will,
independently and without reliance on the Agent, the Assignor or any other
Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Credit Documents, and (ii) it will perform in
accordance with their terms all of the obligations which by the terms of the
Credit Documents are required to be performed by it as a Lender.


 


2.   Payments.  From and after the Closing Date, the Agent
shall make all payments in respect of the Assigned Interest (including payments
of principal, interest, fees and other amounts) to the Assignor for amounts
which have accrued to but excluding the Closing Date and to the Assignee for
amounts which have accrued from and after the Closing Date. The Assignee hereby
acknowledges and agrees to the terms contained in the Intercreditor Agreement


 


3.  General Provisions.
This Assignment and Assumption shall be binding upon, and inure to the benefit
of, the parties hereto and their respective successors and assigns.  This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument.  Delivery of an executed
counterpart of a signature page of this Assignment and Assumption by telecopy
shall be effective as delivery of a manually executed counterpart of this
Assignment and Assumption.  This
Assignment and Assumption shall be governed by, and construed in accordance
with, the law of the State of North Carolina.


 


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Exhibit 1.1(a)


 


BANKRUPTCY
REMOTE BORROWING ENTITY REQUIREMENTS


 


A “Bankruptcy Remote Borrowing Entity”
shall satisfy the following requirements:


 


1.             General Requirements.  The entity’s Organizational Documents must provide for the
following (the term “Organizational Documents” as used herein means (i)
with respect to a corporation, its bylaws, (ii) with respect to a limited
partnership, its limited partnership agreement, and (iii) with respect to a
limited liability company, its operating agreement):


 


(A)                              Limited
Purpose.  The entity’s purpose must
be limited solely to owning and managing its assets, entering into the Credit
Documents and the transactions contemplated thereby and engaging in incidental
activities in connection therewith.


 


(B)                                Certain
Actions Requiring Unanimous Vote. 
The unanimous vote of the entity’s board of directors (including that of
the Independent Director, as defined in Section 2(A) hereof), partners or
members, as applicable, must be required in order to:


 


(i)            take any Bankruptcy Action (as
defined in Addendum A hereof);


 


(ii)                                  dissolve,
liquidate, consolidate, merge or sell all or substantially all of its assets;


 


(iii)          amend or recommend the amendment of
its Organizational Documents; and


 


(iv)                              engage
in transactions with affiliates (except to the extent such transactions are on
terms and conditions substantially as favorable to such Person as would be
obtainable by it in a comparable arms-length transaction with a Person other
than an officer, director, shareholder, Subsidiary or Affiliate).


 


(C)           Separateness Provisions.  The entity must be required to:


 


(i)                                     not
commingle assets with those of any other entity and must hold its assets in its
own name;


 


(ii)                                  conduct
its own business in its own name;


 


(iii)                               maintain
separate bank accounts, books, records and financial statements;


 


(iv)                              maintain
its books, records, resolutions and agreements as official records;


 


(v)                                 pay
its own liabilities out of its own funds;


 


(vi)                              maintain
adequate capital in light of contemplated business operations;


 


(vii)                           observe
all corporate, partnership, company or other organizational formalities;


 


(viii)                        maintain
an arm’s-length relationship with affiliates;


 


(ix)                                pay
the salaries of its own employees and maintain a sufficient number of employees
in light of contemplated business operations;


 


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(x)                                   not
guarantee or become obligated for the debts of any other entity or hold out its
credit as being available to satisfy the obligations of others;


 


(xi)                                not
acquire obligations or securities of affiliates;


 


(xii)                             not
make loans to any other person or entity;


 


(xiii)                          allocate
fairly and reasonably any overhead for shared office space;


 


(xiv)                         use
separate stationery, invoices and checks;


 


(xv)                            not
pledge its assets for the benefit of any other entity;


 


(xvi)                         hold
itself out as a separate entity, and not fail to correct any known
misunderstanding regarding its separate identity; and


 


(xvii)                      not identify
itself or any of its affiliates as a division or part of the other.


 


(D)                               Subordination
of Indemnification Obligations.  The
entity’s obligation, if any, to indemnify its directors and officers, partners,
or members or managers, as applicable, must be fully subordinated to the loan
and the loan documents and must not constitute a claim against it in the event
that cash flow in excess of amounts necessary to pay holders of the loan is
insufficient to pay such obligations.


 


2.                                       Additional
Requirements for Corporations.  In
addition to the general requirements set forth above, for a corporation to be a
Bankruptcy Remote Borrowing Entity, its Organizational Documents must provide
for the following:


 


(A)                              Independent
Director.  The corporation’s board
of directors must include an Independent Director.  An “Independent Director” means a director of the
corporation who is not at the time of initial appointment, has not been at any
time during the preceding five (5) years, and will not be at any time
prior to payment of the loan in full: (i) a stockholder, director, officer,
employee, partner or member of the corporation or the borrower (if the
corporation is a partner or member of the borrower),  or any affiliate thereof;
(ii) a customer, supplier or other person (including without limitation, an
attorney, accountant or other professional) who derives any portion of its
purchases or revenues from its activities with the corporation or the borrower
(if the corporation is a partner or member of the borrower) or any affiliate
thereof, other than reasonable compensation for the performance of its
obligations as Independent Director; (iii) a person or other entity controlling
or under common control with any such stockholder, partner, member, customer,
supplier or other person; or (iv) a member of the immediate family of any such
stockholder, director, officer, employee, partner, member, customer, supplier
or other person.  As used herein, the
term “control” means the possession, directly or indirectly, of the power to
direct or cause the direction of management, policies or activities of a person
or entity, whether through ownership of voting securities, by contract or
otherwise.


 


3.                                       Additional
Requirements for Limited Partnerships. 
In addition to the general requirements set forth above, for a limited
partnership to be a Bankruptcy Remote Borrowing Entity, its Organizational
Documents must provide for the following:


 


(A)                              General
Partner.  Each general partner of
the limited partnership must be a Bankruptcy Remote Borrowing Entity satisfying
the general requirements set forth above and the additional requirements set
forth herein applicable to such general partner (i.e., corporate, limited partnership
or limited liability company requirements). 
In addition, each such general partner’s Organizational Documents must
provide for the following:


 


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(i)                                     Limited
Purpose.  Each such general
partner’s purpose must be limited to serving as a general partner in the
limited partnership.


 


(ii)                                  Unanimous
Vote Required to Withdraw.  The
unanimous vote of each such the general partner’s board of directors (including
that of the Independent Director), partners or members, as applicable, must be
required for the a general partner to withdraw as a general partner of the
limited partnership.


 


(B)                                Continuance
of Partnership.  If there is more
than one general partner, the Organizational Documents must require the remaining
partners to continue the partnership upon an event of dissolution for so long
at least one of the general partners remains solvent.


 


4.                                       Additional
Requirements for Limited Liability Companies.  In addition to the general requirements set forth above, for a
limited liability company to be an SPE, its Organizational Documents must
provide for the following:


 


(A)                              Independent
Member/Manager.  The company must
have one independent member/manager. 
Such independent member/manager should have the same basic traits as the
independent directors described with respect to corporate SPEs.  The determination of whether the independent
entity/individual must be a manager or a member is dependent upon the locus of
control in the LLC.


 


(B)                                SPE
Member.  At least one member of the
company must be an SPE satisfying the general SPE requirements set forth above
and the additional requirements applicable to such member (i.e., corporate,
limited partnership or limited liability company requirements).  “Bankruptcy” events of dissolution must be
limited to the bankruptcy of such SPE member. 
This may necessitate that the entity be designated the sole “managing
member” of the company.  Each such SPE
member’s Organizational Documents must provide for the following:


 


(i)                                     Limited
Purpose.  Such member’s purpose must
be limited to serving as a member in the company.


 


(ii)                                  Unanimous
Vote Required to Withdraw.  The
unanimous vote of such member’s board of directors (including that of the
Independent Director), partners or members, as applicable, must be required for
the member to withdraw as a member of the company.


 


(C)                                Consideration
of  Interests of Creditors.  The company’s members must be required to
consider the interests of creditors in connection with any action subject to
the vote of its members (including the SPE member), notwithstanding that the
company may not then be insolvent.


 


(D)                               Continuance
of Company.  The vote of a
majority-in-interest of the remaining members of the company is sufficient to
continue the life of the company upon the occurrence of an event of dissolution
or other termination event.  If the
required consent of the remaining members to continue the company is not
obtained, the company’s Organization Documents must provide that the company
not liquidate collateral (except as permitted under the loan documents) without
the consent of holders of the loan, and that such holders may continue to
exercise all of their rights under the loan documents and retain any collateral
until the loan has been paid in full or otherwise completely discharged.


 


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Addendum
A


 


As used herein, “Bankruptcy
Action” means any of the following:


 


1.                                       Taking
any action that might cause the entity (or the borrower if the entity is a
partner or member of the borrower)  to become insolvent.


 


2.                                       Commencing
any case, proceeding or other action on behalf of the entity (or the borrower
if the entity is a partner or member of the borrower) under any existing or
future law of any jurisdiction relating to bankruptcy, insolvency,
reorganization or relief of debtors.


 


3.                                       Instituting
proceedings to have the entity (or the borrower if the entity is a partner or
member of the borrower) adjudicated as bankrupt or insolvent.


 


4.                                       Consenting
to the institution of bankruptcy or insolvency proceedings against the entity
(or the borrower if the entity is a partner or member of the borrower).


 


5.                                       Filing
a petition or consent to a petition seeking reorganization arrangement,
adjustment, winding-up, dissolution, composition, liquidation or other relief
on behalf of the entity (or the borrower if the entity is a partner or member
of the borrower) of its (or their) debts under any federal or state law
relating to bankruptcy.


 


6.                                       Seeking
or consenting to the appointment of a receiver, liquidator, assignee, trustee,
sequestrator, custodian or any similar official for the entity (or the borrower
if the entity is a partner or member of the borrower) or a substantial portion
of its (or their) properties.


 


7.                                       Making
any assignment for the benefit of the entity’s creditors (or the borrower’s
creditors if the entity is a partner or member of the borrower).


 


8.                                       Taking
any action (or causing the borrower to take any action if the entity is a
partner or member of the borrower) in furtherance of any of the foregoing.


 










***


Note also the potential necessity for a Non-Consolidation Opinion from
Borrower’s counsel.