ex10-1




EXHIBIT 10.1



        
                
                 
May 11, 2001




Equity Office Properties Trust

EOP Operating Limited Partnership

Senior Term Loan Facility

Commitment Letter




Equity Office Properties Trust

Two North Riverside Plaza

Suite 2100

Chicago, Illinois 60606

Attention: Richard Kincaid




Ladies and Gentlemen:



      EOP Operating Limited Partnership, a Delaware limited partnership (the
“Borrower”) and Equity Office Properties Trust (the “Guarantor”) have requested
that Banc of America Securities, LLC, J.P. Morgan Securities Inc. and Salomon
Smith Barney Inc. (collectively, the “Arrangers”) jointly agree to structure and
arrange a senior term loan facility in an aggregate amount of up to
$1,000,000,000 (the “Facility”). The Arrangers are pleased to advise you that
they are willing to act as joint and exclusive co-advisors, co-lead arrangers
and co-book runners for the Facility. In addition, The Chase Manhattan Bank has
agreed to serve as exclusive syndication agent for the Facility (in such
capacity, the “Syndication Agent”), Bank of America, N.A. has agreed to serve as
exclusive administrative agent for the Facility (in such capacity, the
“Administrative Agent”) and Salomon Smith Barney Inc. has agreed to serve as
exclusive documentation agent for the Facility (in such capacity, the
“Documentation Agent”, and together with the Syndication Agent and the
Administrative Agent, the “Agents”).


      Furthermore, the Syndication Agent, the Administrative Agent and
Citicorp Real Estate, Inc. (“CRE”, and together with the Syndication Agent and
the Administrative Agent, the “Lead Lenders”) and Dresdner Bank AG, New York
and Cayman Branches (“Dresdner”), Bankers Trust Company
(“Bankers Trust”) and PNC
Bank, National Association (“PNC”, and together with Dresdner and Deutsche Bank the “Co-Lenders”)
are pleased to advise you of the several commitment of each of the Lead Lenders
and Co-Lenders to provide up to the following amounts of the Facility upon the
terms and subject to the conditions set forth in this commitment letter (the
“Commitment


 









Letter”) and in the Summary of Terms and Conditions attached hereto as Exhibit A
(the “Term Sheet”)(each, an “Initial Commitment”):



	 	 	 	 	 
	Syndication Agent		$	271,666,666.67	
	
	
	
	

	Administrative Agent		$	271,666,666.67	
	
	
	
	

	CRE		$	271,666,666.66	
	
	
	
	

	Dresdner Bank		$	75,000,000.00	
	
	
	
	

	Deutsche Bank		$	75,000,000.00	
	
	
	
	

	PNC		$	35,000,000.00	



      In the event funds are advanced under the Facility and remain
outstanding for more than 120 days, the Arrangers shall have the right to
syndicate the Facility to financial institutions (collectively, with the Lead
Lenders and the Co-Lenders, the “Lenders”) as further described below, in each
case upon the terms and subject to the conditions set forth or referred to in
this Commitment Letter, the Term Sheet or the Fee Letter referred to below.


      It is agreed that the Administrative Agent will act as the sole and
exclusive administrative agent, that the Documentation Agent will act as sole
and exclusive documentation agent, that the Syndication Agent will act as sole
and exclusive syndication agent and that the Arrangers will act jointly as the
arrangers for the Facility, and each will, in such capacities, perform the
duties and exercise the authority customarily performed and exercised by it in
such roles. The Borrower and the Guarantor agree that no other agents, co-agents
or arrangers will be appointed, no other titles will be awarded and no
compensation (other than that expressly contemplated by the Term Sheet and the
Fee Letter referred to below) will be paid in connection with the Facility
unless the Borrower, the Arrangers, the Agents and the Lead Lenders shall so
agree.


      In the event the Arrangers commence syndication efforts the Borrower
and the Guarantor agree to actively assist the Arrangers in completing such
syndication as reasonably requested by the Arrangers. Such assistance shall
include (a) the Borrower and the Guarantor using commercially reasonable
efforts to ensure that the syndication efforts benefit materially from the
Borrower’s and the Guarantor’s existing lending relationships; (b) the Borrower
and the Guarantor assisting in the preparation of a confidential information
memorandum and other marketing materials to be used in connection with the
syndication by providing the information described in the following paragraph;
and (c) the Borrower and the Guarantor making their senior management and
advisors available to participate, upon reason-


2








able notice, in information meetings for potential syndicate members at such
times and places as the Arrangers may reasonably request.


      The Arrangers will jointly manage all aspects of the syndication,
provided that decisions as to the selection of institutions to be approached and
when they will be approached, when their commitments will be accepted and which
institutions will participate, will be made by mutual agreement of the Arrangers
and the Borrower and the allocations of the commitments among the Lenders and
the amount and distribution of fees among the Lenders will be determined by the
Arrangers, the Agents and the Lead Lenders. The Arrangers will have no
responsibility other than to arrange the syndication. To assist the Arrangers in
their syndication efforts, the Borrower and the Guarantor agree promptly to
prepare and provide to the Arrangers all information with respect to the
Borrower and the Guarantor and the transactions contemplated hereby, including
all financial information and projections (the “Projections”), as the Arrangers
may reasonably request in connection with the arrangement and syndication of the
Facility, so long as disclosure by the Borrower, the Guarantor or any of their
subsidiaries, of such information would not result in a violation of, or expose
the Borrower, the Guarantor or their subsidiaries to any material liability
under, any applicable law, ordinance or regulation or any agreements with
unaffiliated third parties which are binding on the Borrower, the Guarantor or
any of their subsidiaries or on any property of any of them. The Borrower and
the Guarantor agree to use commercially reasonable efforts to obtain any
necessary consents or waivers under any such agreements to disclose such
information to the Arrangers, the Agents and the Lenders. The Borrower and the
Guarantor hereby represent and covenant that (a) all information other than the
Projections (the “Information”) that has been or will be made available to the
Arrangers by the Borrower, the Guarantor or any of their respective
representatives is or will be, when furnished, complete and correct in all
material respects and does not or will not, when furnished, contain any material
misstatement or omission of fact and (b) the Projections that have been or will
be made available to the Arrangers by the Borrower, the Guarantor or any of
their representatives have been or will be prepared in good faith based upon
assumptions believed to be reasonable at the time of preparation thereof. The
Borrower and the Guarantor agree to supplement the Information and Projections
on the 120th day following the funding of the Facility and from time to time
upon request of the Arrangers or the Agents from the date hereof until the
completion of any syndication of the Facility as contemplated by this Commitment
Letter so all Information are complete and correct in all material respects and
do not contain any material misstatements or omissions of fact. The Borrower and
the Guarantor understand that in arranging and syndicating the Facility we may
use and rely on the Information and Projections without independent verification
thereof.


3











      As consideration for the Lenders’ commitment hereunder and the
respective agreements of the Arrangers and the Agents to perform the services
described herein, the Borrower and the Guarantor agree, jointly and severally,
to pay to each of the Lenders the nonrefundable fees set forth in the Term Sheet
and in the Fee Letter dated the date hereof and delivered herewith (the “Fee
Letter”).


      The commitment of the Lead Lenders and the Co-Lenders hereunder and the
respective agreements of the Arrangers and the Agents to perform the services
described herein are subject to (a) there not occurring or becoming known to us
any material adverse condition or material adverse change in or affecting the
business, operations, property, condition (financial or otherwise) or prospects
of the Borrower, the Guarantor and their respective subsidiaries, taken as a
whole since the latest audited financial statements delivered to the Arrangers,
(b) our completion of and satisfaction in all respects with a due diligence
investigation up until the execution of definitive documentation with respect to
the Facility with respect to the business, operations, property, condition
(financial or otherwise) or prospects of the Borrower, the Guarantor and their
respective subsidiaries, (c) our not becoming aware after the date hereof of any
information or other matter affecting the Borrower, the Guarantor or the
transactions contemplated hereby which is inconsistent in a material and adverse
manner with any such information or other matter disclosed to us prior to the
date hereof which inconsistency would have a material adverse effect on the
business, operations, property, condition (financial or otherwise) or prospects
of the Borrower, the Guarantor and their respective subsidiaries, taken as a
whole as shown in the latest audited financial statements delivered to the
Arrangers, (d) our satisfaction that prior to and during the syndication of the
Facility there shall be no competing offering, placement or arrangement of any
bank financing other than property-specific mortgage debt and property-specific
mezzanine debt not prohibited by the Existing Credit Agreement (as defined in
the Term Sheet) by or on behalf of the Borrower, the Guarantor or any affiliate
thereof and other than the assumption of (or advances under) that certain
$171,000,000.00 Master Construction Funding Facility with Mountain Ventures
Golden State, LLC, and other single-member limited liability companies, as
Borrower, First Union National Bank, as Senior Lender and Administrative Agent,
Spieker Properties #183, as Junior Lender, First Union Development Corporation,
as Equity Investor, and Spieker Properties, L.P., as Purchaser, unless otherwise
agreed by the Arrangers and the Agents, (e) the negotiation, execution and
delivery on or before June 15, 2001 of definitive documentation with respect to
the Facility satisfactory to the Lenders and their counsel and (f) the other
conditions set forth or referred to in the Term Sheet.


4











      The Term Sheet attached hereto is intended as an outline only and does
not purport to summarize all of the terms, conditions, covenants,
representations, warranties and other provisions which will be contained in
definitive financing agreements for the Facility. The commitment of each of the
Lenders is subject to the satisfaction of the conditions set forth in this
Commitment Letter and the Term Sheet and customary conditions for transactions
of this type. Subject to the provisions of this Commitment Letter, the
definitive financing agreements shall contain terms, conditions, representations
and warranties, financial and other covenants, events of default and remedies
consistent with the Term Sheet and otherwise satisfactory to the Arrangers, the
Agents and the Lenders.


      The Borrower and the Guarantor agree, jointly and severally to indemnify
the Arrangers, the Agents, the Lenders and the respective affiliates and the
respective directors, officers, agents, advisors and employees of the foregoing
(each an “Indemnitee”) and hold each Indemnitee harmless from and against any
and all liabilities, losses, damages, costs and expenses of any kind, including,
without limitation, the reasonable fees and disbursements of counsel, which may
be incurred by such Indemnitee in connection with any investigative,
administrative or judicial proceeding that may at any time (including, without
limitation, at any time following termination or expiration of this Commitment
Letter) be asserted against any Indemnitee, as a result of, or arising out of,
or in any way related to or by reason of this Commitment Letter, or any of the
transactions contemplated by this Commitment Letter or the execution, delivery
or performance of this Commitment Letter, but excluding those liabilities,
losses, damages, costs and expenses (a) for which such Indemnitee has been
compensated pursuant to the terms of this Commitment Letter or the Fee Letter or
(b) incurred solely by reason of the gross negligence, willful misconduct, bad
faith or fraud of any Indemnitee as finally determined by a court of competent
jurisdiction or (c) owing by such Indemnitee to any third party based upon
contractual obligations of such Indemnitee owing to such third party which are
not expressly set forth in this Commitment Letter. In addition, the
indemnification set forth in this paragraph in favor of any director, officer,
agent, advisor or employee of any Arranger, Agent or Lender shall be solely in
their respective capacities as such director, officer, agent, advisor or
employee. The Borrower’s and the Guarantor’s obligations under this paragraph
shall survive the termination or expiration of this Commitment Letter.


      Except for liability of each Lender for damages incurred by the Borrower
or the Guarantor to Spieker Properties, Inc. or Spieker Properties, L.P.
(collectively, “Spieker Properties”) in connection with a default by the
Borrower or the Guarantor under the Borrower’s agreement with Spieker Properties
that results


5








solely and directly from a breach of the obligations of such Lender under this
Commitment Letter (or directly in combination with such Lender’s breach and a
breach of the obligations of another Lender under this Commitment Letter), no
Arranger, Agent or Lender shall be liable for any special, indirect,
consequential or punitive damages in connection with its activities related to
the Facility or for any special, indirect, consequential or punitive damages in
connection with this Commitment Letter.


      This Commitment Letter shall not be assignable by the Borrower or the
Guarantor without the prior written consent of the Arrangers, the Agents and the
Lead Lenders (and any purported assignment without such consent shall be null
and void). The commitments of the Lenders and the obligations of the Arrangers
and the Agents set forth in this Commitment Letter are intended to be solely for
the benefit of the Borrower and the Guarantor and are not intended to confer any
benefits upon, or create any rights in favor of, any person other than the
Borrower and the Guarantor. This Commitment Letter may not be amended or waived
except by an instrument in writing signed by the Borrower, the Guarantor, the
Arrangers, the Agents and the Lenders. This Commitment Letter may be executed in
any number of counter-parts, each of which shall be an original, and all of
which, when taken together, shall constitute one agreement. Delivery of an
executed signature page of this Commitment Letter by facsimile transmission
shall be effective as delivery of manually executed counterpart hereof. This
Commitment Letter and the Fee Letter are the only agreements that have been
entered into among the Borrower, the Guarantor, the Arrangers, the Agents and
the Lenders with respect to the Facility and set forth the entire understanding
of the parties with respect thereto. This Commitment Letter shall be governed
by, and construed in accordance with, the laws of the State of New York.


      Neither this Commitment Letter, the Term Sheet, the Fee Letter nor any
of the terms or substance thereof shall be disclosed, directly or indirectly, by
the Borrower, the Guarantor or their respective affiliates to any other person,
other than (i) to the respective directors, offices, employees, attorneys and
auditors of the Borrower and the Guarantor on a confidential, “need-to-know”
basis, (ii) such disclosure as may be compelled in a judicial or administrative
proceeding or as otherwise required by applicable law, (iii) to the rating
agencies, (iv) as may be required pursuant to the provisions of any agreement to
which Borrower, Guarantor or such affiliate is a party, (v) as may be required
in connection with Borrower’s, Guarantor’s or such affiliate’s financial
statements, and (vi) in response to a query with respect to this Commitment
Letter, the Fee Letter or the terms or substance thereof.


6











      The Borrower and the Guarantor each acknowledge that the Arrangers, the
Agents and the Lenders may be providing debt financing, equity capital or other
services (including financial advisory services) to other companies in respect
of which the Borrower or the Guarantor may have conflicting interests regarding
the transactions described herein and otherwise. None of the Arrangers, the
Agents, the Lead Lenders or the Co-Lenders will use confidential information
obtained from the Borrower or the Guarantor by virtue of the transactions
contemplated by this Commitment Letter or their other relationships with the Borrower or the Guarantor
in connection with the performance by the Arrangers, the Agents, the Lead
Lenders or the Co-Lenders of services for other companies, and none of the
Arrangers, the Agents, the Lead Lenders or the Co-Lenders will furnish any such
information to other companies. The Borrower and the Guarantor also acknowledge
that the Arrangers, the Agents, the Lead Lenders and the Co-Lenders have no
obligation to use in connection with the transactions contemplated by this
Commitment Letter, or to furnish to the Borrower or the Guarantor, confidential
information obtained from other companies.


      The compensation, reimbursement, indemnification, confidentiality,
syndication and “market flex” provisions contained herein and in the Fee Letter
shall remain in full force and effect regardless of whether definitive financing
documentation shall be executed and delivered and, with respect to
reimbursement, indemnification and confidentiality, notwithstanding the
termination of this Commitment Letter or commitments and respective agreements
of the Arrangers, the Agents and the Lenders hereunder.


      If the foregoing correctly sets forth our agreement, please indicate the
Borrower and the Guarantor’s acceptance of the terms hereof and of the Term
Sheet and the Fee Letter by returning to us executed counterparts hereof and of
the Fee Letter not later than 5:00 p.m., New York City time, on May 15, 2001.
The commitments and respective agreements of the Arrangers, the Agents, the
Lead Lenders and the Co-Lenders herein will expire at such time in the event the
Administrative Agent has not received such executed counterparts in accordance
with the immediately preceding sentence.


7











      The Arrangers, the Agents, the Lead Lenders and the Co-Lenders are pleased to
have been given the opportunity to assist you in connection with this important
financing.




	 	Very truly yours,







	 	Arrangers







	 	BANC OF AMERICA SECURITIES, LLC







	 	By:  /s/ PATRICK TROWBRIDGE 

     Name: Patrick Trowbridge

     Title: Vice President







	 	J.P. MORGAN SECURITIES INC.







	 	By:  /s/ JOHN PERKINS 

     Name: John Perkins

     Title: Vice President







	 	SALOMON SMITH BARNEY INC.







	 	By:  /s/ KENT E. JEWETT 

     Name: Kent E. Jewett

     Title: Managing Director







 














	 	Agents







	 	BANK OF AMERICA, N.A.







	 	By:  /s/ PATRICK TROWBRIDGE 

     Name: Patrick Trowbridge

     Title: Vice President







	 	THE CHASE MANHATTAN BANK







	 	By:  /s/ MARC E. COSTANTINO 

     Name: Marc E. Costantino

     Title: Vice President







	 	SALOMON SMITH BARNEY INC.







	 	By:  /s/ KENT E. JEWETT 

     Name: Kent E. Jewett

     Title: Managing Director







 













	 	Lead Lenders







	 	BANK OF AMERICA, N.A.







	 	By:  /s/ PATRICK TROWBRIDGE 

     Name: Patrick Trowbridge

     Title: Vice President







	 	THE CHASE MANHATTAN BANK







	 	By:  /s/ MARC E. COSTANTINO 

     Name: Marc E. Costantino

     Title: Vice President







	 	CITICORP REAL ESTATE, INC.







	 	By:  /s/ DAVID BOUTON 

     Name: David Bouton

     Title: Director







 












	 	Co-Lenders







	 	DRESDNER BANK AG, NEW YORK

AND CAYMAN BRANCHES







	 	By: /s/ RYAN
HUDDLESTUN
     _______________________________

     Name: Ryan Huddlestun

     Title: Vice President







	 	BANKERS TRUST COMPANY







	 	By: /s/ STEVEN P. LAPHAN
    
_______________________________

     Name: Steven P. Laphan

     Title: Director







	 	PNC BANK, NATIONAL
ASSOCIATION







	 	By: /s/ MICHAEL E. SMITH
    
_______________________________

     Name: Michael E. Smith

     Title: Vice President






 











Accepted and agreed to as of

the date first written above by:



	EQUITY OFFICE PROPERTIES TRUST







	By:   /s/ MAUREEN FEAR 

     Name: Maureen Fear

     Title: Senior Vice President, Treasurer







	EOP OPERATING LIMITED PARTNERSHIP

By:     Equity Office Properties Trust,

          its general partner







	 	By:   /s/ MAUREEN FEAR 

     Name: Maureen Fear

     Title: Senior Vice President, Treasurer






 








EXHIBIT A


SUMMARY OF TERMS AND CONDITIONS 1


Equity Office Properties Trust

EOP Operating Limited Partnership


April [ ], 2001




	 	 	 
	Borrower:		
EOP Operating Limited Partnership (the “Borrower”).
	 
	
	
	
	

	Guarantor:		
Equity Office Properties Trust (the “Guarantor”).
	 
	
	
	
	

	Joint Bookrunners/

Joint Lead Arrangers:		
JPMorgan, a division of Chase Securities Inc., Banc of
America Securities, LLC and Salomon Smith Barney Inc.
(collectively, the “Arrangers”).
	 
	
	
	
	

	Syndication Agent:		
The Chase Manhattan Bank (“Syndication Agent”).
	 
	
	
	
	

	Administrative Agent:		
Bank of America, N.A. (“ Administrative Agent”).
	 
	
	
	
	

	Documentation Agent:		
Salomon Smith Barney Inc. (“Documentation Agent” and
collectively with Syndication Agent and Administrative
Agent, the “Agents”)
	 
	
	
	
	

	Co-Lenders		
[Dresdner Bank AG, New York and Cayman Branches,
Deutsche Bank AG and PNC Bank, NA]
	 
	
	
	
	

	Lenders:		
A syndicate of lenders comprised of The Chase Manhattan
Bank, Bank of America, N.A., Citicorp Real Estate, Inc.
(collectively, the “Lead Lenders”), the Co-Lenders, and, in
the event funds are advanced under the Facility and remain
outstanding for more than 120 days, a syndicate of additional








	1 	 	All capitalized terms not otherwise defined herein shall have the meaning set forth in the
Credit Agreement, dated May 12, 2000 (the “Existing Credit Agreement”), among
Borrower, the Agents and others with respect to Borrower’s existing $1,000,000,000
revolving credit facility (the “Existing Facility”).









	 	 	 
			
lenders arranged by the Arrangers (collectively, the “Lenders”).
	 
	
	
	
	

	Required Lenders:		
Lenders holding at least 66 2/3% of the total commitments.
	 
	
	
	
	

	Purpose:		
The acquisition of Spieker Properties and for no other
purpose.
	 
	
	
	
	

	Facility Type:		
Term Loan (the “Facility”). There shall be a single loan
advance. The amount advanced under the Facility may also
be collectively referred to as the “Loan” or “Loans”.
	 
	
	
	
	

	Commitment Amount:		
$1,000,000,000.
	 
	
	
	
	

	Term:		
364 days from Closing (the “Maturity Date”)
	 
	
	
	
	

	Interest Rate:		
At Borrower’s option, (i) LIBOR Rate plus Applicable
Margin or (ii) Adjusted Base Rate.



	 	 	 	 	 	 	 	 	 
	Applicable Margin for		Range of		Applicable		
	LIBOR Rate Loans:		Borrower's		Margin for		
			Credit Rating		LIBOR Rate		
			(S&P/Moody's		Loans		
			Ratings)		(% per annum)		
			
		

			Non-Investment		1.75				
			Grade		
	 
	
	
	
	

			BBB-/Baa3		1.10				
	 
	
	
	
	

			BBB/Baa2		0.90				
	 
	
	
	
	

			BBB+/Baa1		0.80				
	 
	
	
	
	

			A-/A3 or better		0.70				



	 	 	 
	Adjusted Base Rate:		
A rate per annum equal to the higher of (i) the Prime Rate for
such day and (ii) the sum of 0.5% plus the Federal Funds
Rate.




2






	 	 	 
	LIBOR Options:		
1, 2 or 3 (if available from all Lenders) months not to extend
beyond maturity of the Loan. Borrower may have a maximum
of ten LIBOR contracts outstanding at any one time.
	 
	
	
	
	

	Default Rate:		
Adjusted Base Rate plus 4%
	 
	
	
	
	

	Interest Payment

Period:		
Interest will be payable monthly in arrears on Adjusted Base
Rate Loans. Interest on LIBOR Rate Loans will be payable
in arrears at the end of the applicable interest period (provided
that in the event any Interest Period ends on the date
which is 60 or 90 days after the date on which any Interest
Period commences, interest on such LIBOR Rate Loans shall
be payable on the first Business Day of each calendar month
during such Interest Period and on the last day of such
Interest Period). The Facility will include customary provision
concerning computation of the LIBOR Rate, adjustments
for reserves and capital adequacy, yield protection and
indemnification. If the LIBOR Rate is for any reason
unavailable, amounts outstanding under the Facility will bear
interest at a per annum rate equal to the Adjusted Base Rate
during the period of such unavailability.
	 
	
	
	
	

	Interest Calculation:		
Interest will be computed on the basis of a 360 day year and
paid for the actual number of days elapsed during each
Interest Payment Period.
	 
	
	
	
	

	Borrowing Certificate:		
At the time Borrower requests to advance the Loan, it shall
deliver to Administrative Agent a borrowing certificate
which will state the amount of the Loan to be advanced.
	 
	
	
	
	

	Voluntary

Prepayments:		
Prepayments will be allowed without penalty if made upon
one business day’s notice. Breakage payments will be
required for repayments of LIBOR Rate Loans prior to the
expiration of the applicable interest period. Amounts prepaid
may not be reborrowed.
	 
	
	
	
	

	Mandatory

Prepayments:		
If, at any time, Borrower or Guarantor receives Net Offering
Proceeds or proceeds from any bond or debt offering or
issuance in the form of cash, then, simultaneously therewith,




3






	 	 	 
			
the Borrower shall repay the outstanding Obligations.
	 
	
	
	
	

			
If at any time the Borrower shall receive proceeds, dividends
or distributions relating to sale or disposition of the Borrower’s
interests in material Property or other assets (including,
but not limited to, Joint Venture Interests and equity
interests in Subsidiaries), then, simultaneously therewith, the
Borrower shall repay the Loans in an amount equal to the
lesser of (x) the aggregate Net Price in the form of cash
relating to such sale or disposition received by the Borrower,
and (y) the outstanding Obligations; provided, however, the
Borrower shall not be required to make any such repayment
if and to the extent the Borrower uses such proceeds, dividends
or distributions to purchase Real Property Assets,
provided that (i) the Borrower identifies such Real Property
Assets to the Administrative Agent within forty-five (45)
days after the date of the receipt of such proceeds, dividends
or distributions and (ii) the purchase and sale of one or more
of such Real Property Assets closes within 180 days after the
date of the receipt of such proceeds, dividends or distributions.
		
	
	
	
	

			
            
           
			
Loans will be repaid in full upon the earlier of (i) the Maturity
Date and (ii) the declaration of an Event of Default under
the Credit Agreement. Amounts repaid may not be reborrowed.
	 
	
	
	
	

	Recourse:		
The Facility shall be fully recourse to Borrower and Guarantor.
	 
	
	
	
	

	Conditions Precedent:		
Customary for facilities of this type, including (but not
limited to):
	 
	
	
	
	

			
•  negotiation and execution of satisfactory closing
documentation;
	
	
	
	

			
•  no environmental liability
	
	
	
	

			
•  payment of fees and expenses
	
	
	
	

			
•  accuracy of representations and warranties;
	
	
	
	

			
•  no defaults or Events of Default; and
	
	
	
	

			
•  completion of due diligence.




4







	 	 	 
	
	
	
	

			
•  consummation of the acquisition of Spieker Properties
	
	
	
	

			
•  receipt of approval from the lenders under Borrower’s
Existing Facility if
    required under section 5.9 of the
Existing Credit Agreement
	 
	
	
	
	

	Representations &
Warranties:		
Usual representations and warranties for a facility of this
type, including (but not limited to):
	 
	
	
	
	

			
•  corporate existence;
	
	
	
	

			
•  power and authority;
	
	
	
	

			
•  no contravention of law or organizational documents
of Borrower or
    Guarantor;
	
	
	
	

			
•  financial condition;
	
	
	
	

			
•  solvency;
	
	
	
	

			
•  no material litigation;
	
	
	
	

			
•  no material environmental matters;
	
	
	
	

			
•  payment of taxes due and payable;
	
	
	
	

			
•  ERISA;
	
	
	
	

			
•  use of proceeds;
	
	
	
	

			
•  governmental approvals;
	
	
	
	

			
•  compliance with laws;
	
	
	
	

			
•  REIT status of Guarantor;
	
	
	
	

			
•  labor matters;
	
	
	
	

			
•  insurance;
	
	
	
	

			
•  ownership of properties, etc.
	
	
	
	

			
•  such other representations and warranties as are
contained in the Existing
    Credit Agreement.
	 
	
	
	
	

	Affirmative and Negative
Covenants:		
Usual Borrower covenants for a facility of this type including
(but not limited to):
	 
	
	
	
	

			
•  financial reporting;
	
	
	
	

			
•  payment and discharge of obligations prior to maturity;
	
	
	
	

			
•  maintenance of properties and insurance;
	
	
	
	

			
•  conduct of business;
	
	
	
	

			
•  compliance with laws;
	
	
	
	

			
•  maintenance of existence;
	
	
	
	

			
•  inspection of properties, books and records



5








    

	 	 	 
	
	
	
	

			
•  restriction on fundamental changes with respect to
Borrower or Guarantor
    except as permitted in the
Existing Credit Agreement;
	
	
	
	

			
•  restriction on changes in business
	
	
	
	

			
•  Guarantor to (i) remain a publically traded company
listed on the New
    York Stock Exchange and (ii)
maintain its status as a self-directed
and
    self-administered REIT;
	
	
	
	

			
•  Guarantor restricted from incurring, assuming Indebtedness
other than
    the Indebtedness created by this
Facility and Indebtedness of the
Borrower
    for which there is no recourse to Guarantor which may be
incurred without
    creating an Event of Default or
Default under the Facility;
	
	
	
	

			
•  neither Guarantor nor Borrower shall be subject to an
Environmental Claim
    except as permitted in the
Existing Credit Agreement;
	
	
	
	

			
•  Guarantor restricted from disposing of any interests
in the Borrower except
    as permitted by the Existing
Credit Agreement;
	
	
	
	

			
•  Guarantor and Borrower to restrict Subsidiaries,
Financing Partnerships
    and Joint Venture Subsidiaries
to incur Indebtedness other than as
    permitted in the Existing Credit Agreement;
	
	
	
	

			
•  Borrower restricted from settling forward equity
contracts with cash;
	
	
	
	

			
•  notification to Administrative Agent of default,
material claim or material
    adverse change; and
	
	
	
	

			
•  use of proceeds.
	 
	
	
	
	

	Financial and other Cove-
nants:		
Customary for facilities of this type, including, but not
limited, to the following:
	 
	
	
	
	

			
Total Liabilities to Total Asset Value. The ratio of Total
Liabilities to Total Asset Value of Borrower shall not exceed
0.55:1 at any time.
	 
	
	
	
	

			
EBITDA to Interest Expense Ratio. The ratio of EBITDA
for the then most recently completed Fiscal Quarter to
Interest Expense for the then most recently completed Fiscal




6






	 	 	 
	
	
	
	

			
Quarter shall not be less than 2.00:1.
	 
	
	
	
	

			
Cash Flow to Fixed Charges Ratio. The ratio of Cash Flow
for the then most recently completed Fiscal Quarter to Fixed
Charges for the then most recently completed Fiscal Quarter
shall not be less than 1.5:1.
	 
	
	
	
	

			
Secured Debt to Total Asset Value. Secured Debt to Total
Asset Value of Borrower not to exceed 0.40:1 at any time.
	 
	
	
	
	

			
Unencumbered Pool. The ratio of the outstanding Unsecured
Debt to Unencumbered Asset Value shall not exceed 0.55:1
at any time.
	 
	
	
	
	

			
Unencumbered Net Operating Income to Unsecured Debt
Service. The ratio of Unencumbered Net Operating Income
for the then most recently completed Fiscal Quarter to
Unsecured Debt Service for the then most recently completed
Fiscal Quarter shall not be less than 2.0:1.
	 
	
	
	
	

			
Minimum Tangible Net Worth. The Consolidated Tangible
Net Worth of the Borrower determined in conformity with
GAAP will at no time be less than the sum of (i)
$7,800,000,000 and (ii) seventy percent (70%) of all Net
Offering Proceeds (other than cash or other assets received as
a result of the issuance of notes, bonds or other debt instruments)
received by the Guarantor or the Borrower after February 29, 2000.
	 
	
	
	
	

			
Dividends. The Borrower will not, as determined on an aggregate
annual basis, pay any partnership distributions in
excess of 90% of the Borrower’s FFO for such year. During
the continuance of a monetary Event of Default, Borrower
shall only pay partnership distributions that are necessary to
enable Guarantor to make those dividends necessary to
maintain Guarantor’s status as a real estate investment trust.
	 
	
	
	
	

			
Permitted Holdings. Borrower’s primary business will be the
ownership, operation and development of Office Properties
and Parking Properties and any other business activities of




7








	 	 	 
	
	
	
	

			
Borrower and its Subsidiaries will remain incidental thereto.
Notwithstanding the foregoing, Borrower and its Subsidiaries
may acquire or maintain Permitted Holdings if and so long as
the aggregate value of Permitted Holdings, whether held
directly or indirectly by Borrower does not exceed, at any
time, twenty-five percent (25%) of Total Asset Value of
Borrower unless a greater percentage is approved by the
Majority Banks (which approval shall not be unreasonably
withheld, conditioned or delayed); provided, however,
Borrower and its Subsidiaries may not acquire or maintain (i)
Unimproved Assets if and to the extent that the aggregate
value of Unimproved Assets, whether held directly or
indirectly by Borrower exceeds, at any time, ten percent
(10%) of Total Asset Value of Borrower or (ii) interests in
Taxable REIT Subsidiaries if and to the extent that the
aggregate value of interests in Taxable REIT Subsidiaries,
whether held directly or indirectly by Borrower exceeds, at
any time, twenty percent (20%) of Total Asset Value of
Borrower unless, in either case, a greater percentage is
approved by the Majority Banks (which approval shall not be
unreasonably withheld, conditioned or delayed). For purposes
of calculating the foregoing percentage the value of Unimproved
Assets and interests in Taxable REIT Subsidiaries
shall be calculated based upon the cost value thereof,
determined in accordance with GAAP; provided that, in the
case of any Unimproved Assets held by an Investment
Affiliate, only Borrower’s Share of the cost of such Unimproved
Assets shall be used in calculating the foregoing percentages.
	 
	
	
	
	

			
No Liens. Borrower and Guarantor shall not allow, and shall
not allow any of their Subsidiaries, Financing Partnerships or
Joint Venture Subsidiaries to allow, any Qualifying Unencumbered
Property (or any equity interests in such Property
that are owned directly or indirectly by Borrower, Guarantor
or any Joint Venture Parent to become subject to a Lien that
secures the Indebtedness of any Person, other than Permitted
Liens.



8






	 	 	 
	
	
	
	

	Events of Default:		
Customary defaults including (but not limited to):
	 
	
	
	
	

			
•  Payment defaults: Failure to pay (i) any principal on
a Loan when due (no
    grace period), or (ii) any interest,
fees or others amounts as and when
    due,
subject to 5 calendar days grace;
	
	
	
	

			
•  failure to observe financial covenants;
	
	
	
	

			
•  failure to observe covenants with respect to restrictions
on fundamental
    changes, changes in business or
forward equity contracts;
	
	
	
	

			
•  failure to observe and perform other covenants for 30
days after written
    notice from Administrative Agent;
	
	
	
	

			
•  material errors in representations and warranties and
with respect to
    inadvertent misrepresentations, not
corrected within 30 days of being
    made;
	
	
	
	

			
•  cross default to other guaranteed or recourse debt of
Borrower, Guarantor,
    any Subsidiary or any Investment
Affiliate in excess of $25 million;
	
	
	
	

			
•  commencement of a voluntary case of bankruptcy,
insolvency or other
    similar law with respect to
Borrower or Guarantor;
	
	
	
	

			
•  commencement of an involuntary case of bankruptcy,
insolvency or other
    similar law against Borrower with
respect to Borrower or Guarantor;
	
	
	
	

			
•  cross default to other loan documents;
	
	
	
	

			
•  ERISA;
	
	
	
	

			
•  the entry of one or more final nonappealable judgments
or decrees in an
    aggregate amount of
$20,000,000 against Borrower or Guarantor, or to
the
    extent recourse to Borrower or Guarantor, any of
their Consolidated
    Subsidiaries;
	
	
	
	

			
•  environmental;
	
	
	
	

			
•  change of control (board of trustees) of Guarantor;
	
	
	
	

			
•  any Person or group shall acquire more than 30% of
the common shares of
    Guarantor;
	
	
	
	

			
•  Guarantor shall fail to maintain REIT status; or
	
	
	
	

			
•  Borrower or Guarantor shall repudiate their respective
obligations under
    the Loan Documents or Guaranty.



9






	 	 	 
	
	
	
	

	Changes in Circumstances/

Increased Costs:		
Agreement to contain customary provisions protecting
Agents and other Lenders in the event of unavailability of
funding, capital adequacy and increased costs.
	 
	
	
	
	

	Expenses:		
Borrower to reimburse Agents for all reasonable fees in
connection with this transaction, and any subsequent amendments
or waivers, including legal fees.
	 
	
	
	
	

	Indemnification:		
Borrower to indemnify Bank of America, N.A., in its
capacity as Administrative Agent, and each Lender against all
losses, liabilities, claims, damages or expenses relating to the
Facility, any violation of environmental law and the exercise
of any rights or remedies under the Facility, including
attorneys’ fees and settlement costs, except if such losses,
liabilities, claims, damages or expenses result from Lenders’
gross negligence or willful misconduct.
	 
	
	
	
	

	Amendments/Waivers;
Voting:		
Amendments and waivers with respect to the loan documents
shall require the approval of the Required Lenders; provided
that no such agreement shall, without the prior written
consent of all of the Lenders (i) increase the commitment of
any Lender, (ii) reduce the principal amount of any Loan or
reduce the rate of interest thereon, or reduce any fees payable
hereunder, (iii) postpone the scheduled date of payment of
the principal amount of any Loan, or any interest thereon, or
any fees payable hereunder or for any reductions or termination
of any Commitment, (iv) change the percentage of the
Commitments or of the aggregate unpaid principal amount of
the Notes or the number of Lenders, which shall be required
for the Lenders or any of them to take any action with respect
to modifying or waiving any provision of the Loan Documents
or (v) release the Guaranty.
	 
	
	
	
	

	Assignments and
Participations:		
The Lenders shall be permitted to sell participations in their
Loans and commitments. In addition, the Lenders shall be
permitted to assign all or a portion of their Loans to a
Qualified Institution in minimum amounts of $5,000,000 and
multiples of $1,000,000, subject to the consent of the
Administrative Agent and the Borrower, which consent in
each case shall not be unreasonably withheld. Notwithstand-



10






	 	 	 
	
	
	
	

			
ing the foregoing, neither Administrative Agent’s or the
Borrower’s consent shall be required for assignments during
the continuance of an Event of Default. In addition, no
consent of the Administrative Agent or the Borrower shall be
required in the case of an assignment to an affiliate of such
Lender or to another Lender. A fee of $2,500 shall be
payable by the assignor to the Administrative Agent upon any
assignment. With respect to a participation, the Lenders shall
be permitted to grant participation interest in their Loans to
existing Lenders, one or more banks, finance companies,
insurance companies or to other financial institutions in
minimum amounts of $5,000,000. Notwithstanding the
foregoing, Borrower’s consent shall not be required during
the continuance of an Event of Default. To the extent
provided in each participation agreement, participants shall
have the same benefits as the Lenders with respect to yield
protection and increased cost provisions (but not in excess of
the principal). Voting rights of participants shall be limited
to those matters with respect to which the affirmative vote of
the Lender from which it purchased its participation would
be required as described under “Voting” above.

	 
	
	
	
	

			
Notwithstanding anything to contrary set forth above, so long
as no Event of Default shall have occurred and is be continuing,
no Lender shall enter into an assignment of or sell a
participation interest in, it rights in its Loans which would
result in a Lender holding a Commitment without participants
of less than $5,000,000, unless as a result of a cancellation
or reduction of the aggregate Commitments, provided
however, that no Lender shall be prohibited from assigning
its entire Commitment so long as such assignment is otherwise
permitted by this section.
	 
	
	
	
	

	Confidentiality:		
In connection with this Facility, Lenders agrees to use
reasonable efforts not to disclose any information with
respect to Borrower or Guarantor and its Subsidiaries and
Investment Affiliates and the Properties thereof, not generally
disclosed to the public, which is furnished pursuant to this
agreement except for customary carve outs and exceptions as
permitted in the Existing Credit Agreement.



11






	 	 	 
	 
	
	
	
	

	Expenses:		
All fees and expenses as set forth in a separate fee letter.
	 
	
	
	
	

	Governing Law
and Forum:		
New York
	 
	
	
	
	

	Lender’s Counsel:		
Skadden, Arps, Slate, Meagher & Flom LLP




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