EX-10.1






LOAN AGREEMENT




by and among




G&E HEALTHCARE REIT 5995 PLAZA DRIVE, LLC,

G&E HEALTHCARE REIT ACADEMY, LLC,

G&E HEALTHCARE REIT EPLER PARKE BUILDING B, LLC,

G&E HEALTHCARE REIT NUTFIELD PROFESSIONAL CENTER, LLC

and

G&E HEALTHCARE REIT MEDICAL PORTFOLIO 2, LLC,

as Borrower,




the Lenders Party Hereto, and




WACHOVIA FINANCIAL SERVICES, INC,

as Administrative Agent




with




WACHOVIA CAPITAL MARKETS, LLC,

As Lead Arranger and Sole Bookrunner




dated as of




June 24, 2008




1




TABLE OF CONTENTS




Page




2




LOAN AGREEMENT




This Loan Agreement is made as of June 24, 2008 by and among G&E HEALTHCARE REIT 5995 PLAZA
DRIVE, LLC, a Delaware limited liability company (“UnitedHealth Group Building Borrower”), G&E
HEALTHCARE REIT ACADEMY, LLC, a Delaware limited liability company (“Academy Medical Center
Borrower”), G&E HEALTHCARE REIT EPLER PARKE BUILDING B, LLC, a Delaware limited liability company
(“Epler B Borrower”), G&E HEALTHCARE REIT NUTFIELD PROFESSIONAL CENTER, LLC, a Delaware limited
liability company (“Nutfield Professional Park Borrower”), (“North Texas Neurology Borrower”) and
G&E HEALTHCARE REIT MEDICAL PORTFOLIO 2, LLC, a Delaware limited liability company (“Cirrus
Borrower” and both individually and collectively with UnitedHealth Group Building Borrower, Academy
Medical Center Borrower, Epler B Borrower, and Nutfield Professional Park Borrower, “Borrower”),
whose address is c c/o Triple Net Properties, LLC, 1551 N. Tustin Avenue, Suite 300, Santa Ana,
California 92705, the Lenders party hereto from time to time (the “Lenders”) and WACHOVIA FINANCIAL
SERVICES, INC., a North Carolina corporation, whose address is c/o Wachovia Bank, N.A., Real Estate
Financial Services, General Banking Group, Mail Code: CA 6233, 15750 Alton Parkway, Irvine,
California 92618 (“Administrative Agent”).



RECITALS




A. Borrower has acquired or will acquire fee simple title to that certain real property
described in Exhibits A-1 through A-7 attached hereto.



B. Borrower has requested that the Lenders extend credit to it for the financing and operation
of the Projects (as defined herein).



C. The Lenders are prepared to extend such credit in accordance with and subject to the terms
and conditions set forth herein.



NOW, THEREFORE, in consideration of the covenants and conditions herein contained, the
Borrower, the Lenders and the Administrative Agent, each intending to be legally bound, hereby
agree as follows:



ARTICLE I




DEFINITIONS




1.1 Definitions. As used herein, the following terms shall have the meanings set forth
below:



"Academy Medical Center Project” shall mean the Academy Medical Center Property and the
Improvements thereon.



"Academy Medical Center Property” shall mean the real property described in
Exhibit A-2 attached hereto.



"Adjusted Loan Basis” means, with respect to each Project, the amount set forth opposite the
reference to such Project in Schedule 1.1(A) under the caption “Loan Basis,” and as such
Loan Basis may be increased or decreased pursuant to the terms hereof.



"Administrative Agent” has the meaning set forth in the preamble hereof and shall include any
successor administrative agent appointed pursuant to Section 12.6.



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



"Affiliate” of any Person means any other Person directly or indirectly controlling,
controlled by or under direct or indirect common control with 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.



"Aggregate Commitment” means the aggregate Commitments of all the Lenders, which is
$50,321,500.00.



"Agreement” shall mean this Loan Agreement, as the same may be amended, modified,
supplemented, renewed and restated from time to time.



"Appraisal” shall mean an appraisal of the “as is” value of the Properties and the
Improvements (i) ordered by Administrative Agent, (ii) prepared by an appraiser satisfactory to
Administrative Agent, (iii) in compliance with all federal and state standards for appraisals,
(iv) reviewed by Administrative Agent and (v) in form and substance satisfactory to Administrative
Agent in its sole and absolute discretion; provided, however, that in reviewing such appraisals and
applying such discretion, Administrative Agent will act in good faith and will consistently apply
the standards generally used by Administrative Agent in the normal course of its real estate
lending business in order to review and evaluate appraisals.



"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.



"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 13.1), and accepted by Administrative Agent, in substantially the form of
Exhibit B or any other form approved by Administrative Agent.



"Borrower” has the meaning set forth in the preamble hereof.



"Borrowing Date” means any Business Day specified pursuant to Section 4.3 as a date on
which the Lenders make a disbursement of the Loans hereunder.



"Budget” shall mean the cost breakdown/budget for the Loans attached hereto as
Exhibit C, which shall set forth the costs to be paid with the Loans.



"Business Day” means (a) with respect to any borrowing or payment of Loans, a day (other than
a Saturday or Sunday) on which banks generally are open in Charlotte, North Carolina for the
conduct of substantially all of their commercial lending activities and on which dealings in
Dollars are carried on in the London interbank market and (b) for all other purposes, a day (other
than a Saturday or Sunday) on which banks generally are open in Charlotte, North Carolina for the
conduct of substantially all of their commercial lending activities.



"Calendar Month” shall mean any of the twelve (12) calendar months of the year. With respect
to any payment or obligation that is due or required to be performed within a specified number of
Calendar Months, then such payment or obligation shall become due on the day in the last of such
specified number of Calendar Months that corresponds numerically to the date on which such payment
or obligation was incurred or commenced; provided, however, that with respect to any obligation
that was incurred or commenced on the 29th, 30th or 31st day of any Calendar Month and if the
Calendar Month in which such payment or obligation would otherwise become due does not have a
numerically corresponding date, such obligation shall become due on the first Business Day of the
next succeeding Calendar Month.



"CC&R’s” shall mean any and all covenants, conditions, restrictions, maintenance agreements or
reciprocal easement agreements affecting any Project or any of the Properties.



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



"Closing Date” shall mean the date the earlier of (i) the earliest date a Mortgage is recorded
in the official records of the applicable County or (ii) the date that any Loan proceeds are
disbursed pursuant to the terms of this Agreement.



"Code” means” the Internal Revenue Code of 1986, as amended or superseded from time to time.
Any reference to a specific provision of the Code shall be construed to include any comparable
provision of the Code as hereafter amended or superseded.



"Collateral” shall mean all real and personal property (whether tangible or intangible) in
which a lien, encumbrance or security interest is granted in favor of Administrative Agent, for the
benefit of the Lenders, pursuant to the Loan Documents.



"Commitment” has the meaning set forth in Section 2.1(a).



"County” shall mean each County in California, Missouri, Texas, New Hampshire, Arizona or
Indiana where one of the Properties is located.



"Day” or “Days” shall mean calendar days unless expressly stated to be Business Days.



"Debt Service Coverage Ratio” shall mean a fraction, the numerator of which is the Net
Operating Income from the Projects then serving as Collateral before payment of debt service for
the three-month period in question, and the denominator of which is an amount equivalent to the sum
of (a) an amount, as reasonably determined by Administrative Agent, equivalent to the interest that
would accrue on the Loans during such three-month period at a rate of interest equal to the
greater of (i) seven percent (7.0%) per annum, or (ii) the rate of one and one-half percent
(1.5%) per annum above the Treasury Note Rate (herein defined), and (b) an amount for such period,
as reasonably determined by Administrative Agent, equivalent to the amount of principal that would
be payable during such three-month period according to a schedule that would fully amortize the
Loans over a 25-year period given the foregoing rate of interest.



"Deed of Trust” shall mean each Deed of Trust, Assignment, Security Agreement and Fixture
Filing executed by a Borrower, as trustor, and naming Administrative Agent as beneficiary, and each
Mortgage, Assignment, Security Agreement and Fixture filing (or amended and restated mortgage)
executed by a Borrower, as mortgagor, and naming Administrative Agent as mortgagee, in each case
creating a first lien on a Property, the Improvements thereon, and all other buildings, fixtures
and improvements now or hereafter owned or acquired by Borrower and situated on such Property, and
all rights, interests, and easements appurtenant thereto, securing indebtedness and obligations
pursuant to the Loan Documents, all in form and substance acceptable to Borrower and Administrative
Agent, as such deeds of trust may be amended, modified, supplemented, renewed and restated from
time to time.



"Defaulting Lender” means, as of any date, any Lender that has (a) failed to make a Loan
required to be made by it hereunder, (b) given notice to Administrative Agent or Borrower that it
will not make, or that it has disaffirmed or repudiated any obligation to make, any Loan required
to be made by it hereunder (unless such notice is given by all Lenders) or (c) been deemed
insolvent or become the subject of a bankruptcy or insolvency proceeding.



"Epler B Project” shall mean the Epler B Property and the Improvements thereon.



"Epler B Property” shall mean the real property described in Exhibit A-3 attached
hereto.



"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) with total assets of $1,000,000,000 or more
that is regularly engaged in commercial lending activities as one of its core businesses, and is
approved by (i) Administrative Agent and (ii) unless an Event of Default has occurred and is
continuing, Borrower (each such approval not to be unreasonably withheld or delayed);
provided that notwithstanding the foregoing, “Eligible Assignee” shall not include
Borrower or any of Borrower’s Affiliates or Subsidiaries.



"Environmental Indemnity” shall mean each Environmental Indemnity Agreement executed by a
Borrower and Guarantor.



"Event of Default” shall mean the occurrence of any of the events listed in
Section 11.1 of this Agreement.



"ERISA” shall mean Employee Retirement Income Security Act of 1974, as the same may, from time
to time, be amended.



"Excluded Taxes” means, with respect to Administrative Agent, any Lender, or any other
recipient of any payment to be made by or on account of any obligation of Borrower hereunder,
(a) taxes imposed on or measured by its overall net income (however denominated), and franchise
taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political
subdivision thereof) under the laws of which such recipient is organized or in which its principal
office is located or, in the case of any Lender, in which its applicable Lending Office is located,
(b) any branch profits taxes imposed by the United States of America or any similar tax imposed by
any other jurisdiction in which Borrower is located and (c) in the case of a Foreign Lender (other
than an assignee pursuant to a request by Borrower under Section 2.14), any withholding tax
that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a
party hereto (or designates a new Lending Office) or is attributable to such Foreign Lender’s
failure or inability (other than as a result of a Change in Law) to comply with Section
2.11(e), except to the extent that such Foreign Lender (or its assignor, if any) was entitled,
at the time of designation of a new Lending Office (or assignment), to receive additional amounts
from the Borrower with respect to such withholding tax pursuant to Section 2.11(a).



"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, however, that (a) if the day for which such rate is to be determined
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
such rate is not so published for any Business Day, the Federal Funds Rate for such Business Day
shall be the average rate charged to Administrative Agent on such Business Day on such transactions
as determined by Administrative Agent.



"Fee Letter” shall mean that certain letter agreement of even date herewith between Wachovia
Bank and Borrower, pertaining to the payment by Borrower to Wachovia Bank of certain fees in
connection with this Agreement.



"Financing Statements” shall mean UCC-1 financing statements authorized by Borrower, as
debtor, in favor of Administrative Agent, as secured party, and perfecting Administrative Agent’s
security interest in the collateral described therein, each in form and substance satisfactory to
Administrative Agent, to be filed in the Office of the Secretary of State of Delaware, and in such
other offices for recording or filing such statements in such jurisdictions as Administrative Agent
shall desire to perfect Administrative Agent’s security interest or reflect such interest in
appropriate public records.



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



"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.



"Governmental Authority” shall mean (a) any governmental municipality or political subdivision
thereof, (b) any governmental or quasi-governmental agency, authority, board, bureau, commission,
department instrumentality or public body, or (c) any court, administrative tribunal or public
utility.



"Guarantor” shall mean Grubb & Ellis Healthcare REIT, Inc., a Maryland corporation.



"Guaranty” shall mean that certain Guaranty of even date herewith executed by Guarantor in
favor of Administrative Agent and Lenders, as now existing and as may hereafter be amended.



"Improvements” shall mean all on-site and off-site improvements, if any, and appurtenances now
or later to be located on each Property and/or in such improvements.



"Indebtedness” means, as to any Person (a) indebtedness created, issued, incurred or assumed
by such Person for borrowed money or evidenced by bonds, debentures, notes or similar instruments;
(b) all obligations of such Person to pay the deferred purchase price of property or services and
all other accounts payable; (c) all indebtedness secured by a lien on any asset of such Person
whether or not such indebtedness is assumed by such Person; (d) all obligations, contingent or
otherwise, of such Person directly or indirectly guaranteeing any indebtedness or other obligation
of any other Person or in any manner providing for the payment of any indebtedness or other
obligation of any other Person or otherwise protecting the holder of such indebtedness against loss
(excluding endorsements for collection or deposit in the ordinary course of business); (e) the
amount of all reimbursement obligations and other obligations of such Person (whether due or to
become due, contingent or otherwise) in respect of letters of credit, drafts, notes, bankers’
acceptances, surety or other bonds and similar instruments; (f) all capitalized lease obligations;
(g) all other obligations that would be included as liabilities on a balance sheet prepared in
accordance with GAAP; (h) all payables of such Person relating to minority interests; and (i) net
liabilities under Swap Contracts.



"Indemnified Taxes” means Taxes other than Excluded Taxes.



"Interest Period” means each period commencing on the last day of the immediately preceding
Interest Period and ending on the same day of the month that interest is due 1 month thereafter;
provided, (a) the first Interest Period shall commence on the Closing Date and end on the first day
of the next Calendar Month, (b) any Interest Period that ends in a month for which there is no day
which numerically corresponds to the last day of the immediately preceding Interest Period shall
end on the last day of the month, and (c) any Interest Period that would otherwise extend past the
Maturity Date shall end on the Maturity Date.



"Leases” means all leases, and other occupancy or use agreements (whether oral or written),
now or hereafter existing, which cover or relate to any Project or any part thereof, together with
all options therefor, amendments thereto and renewals and modifications thereof.



"Lenders” has the meaning set forth in the preamble hereof.



"Lending Office” means with respect to a Lender, the office, branch, subsidiary or affiliate
of such Lender identified in the Administrative Questionnaire delivered by such Lender to the
Administrative Agent or otherwise selected by such Lender pursuant to Section 4.5.



"LIBOR Rate” means, with respect to each Interest Period, the rate per annum (subject to the
minimum “floor” rate specified below) determined on the basis of the offered rate for deposits in
U.S. dollars having a maturity of one month which appears on the Reuters Screen LIBOR01 Page as of
11:00 a.m. (London time) on the second London Banking Day before such Interest Period begins, or if
such day is not a London Banking Day, then on the immediately preceding London Banking Day,
plus 2.15% per annum; provided that, if no such offered rates appear on such page, the
applicable “LIBOR Rate” shall instead be the arithmetic average (rounded upward, if necessary, to
the next higher 1/100th of 1%) of rates quoted by not less than two (2) major lenders in New York
City, selected by the Administrative Agent, at approximately 10:00 a.m., New York City time, on
such day, for deposits in U.S. dollars offered by leading European banks having a maturity of one
month in a amount comparable to the outstanding principal amount of the Loans, plus 2.15%
per annum; provided, further, that if on any day the Administrative Agent is unable to determine
the LIBOR Rate in the foregoing manner, the LIBOR Rate for such day shall be the rate per annum
equal to the Prime Rate for such day. Notwithstanding the foregoing, in no event shall the “LIBOR
Rate” hereunder at any time be less than 4.65% per annum.



"Loan Documents” shall mean this Agreement, the Notes, the Deeds of Trust, the Financing
Statements, the Guaranty, the Environmental Indemnities, the Subordination of Property Management
Agreements, and all other documents and instruments (other than any Swap Contracts) now or
hereafter executed and delivered in connection with this Agreement and the Loans described herein.



"Loan-to-Value Ratio” shall mean the ratio, expressed as a percentage, of (a) the outstanding
principal balance of the Notes and all other sums owing under the Loan Documents, to (b) the “as
is” value of the Projects then encumbered by Deeds of Trust, as set forth in the applicable
Appraisal, as approved by Administrative Agent in its sole discretion.



"Loans” means the loan or loans made by the Lenders pursuant to this Agreement that are more
particularly described in Section 2.1.



"London Banking Day” means a day on which dealings in dollar deposits are conducted by and
between banks in the London interbank eurodollar market.



"Lonestar Endoscopy Project” shall mean the Lonestar Endoscopy Property and the Improvements
thereon.



"Lonestar Endoscopy Property” shall mean the real property described in Exhibit A-7
attached hereto.



"Maturity Date” shall mean the date upon which the Loans become due and payable, which date
shall be June 30, 2011, subject to possible extension as set forth in Section 2.4.



"Net Operating Income” shall mean the amount of (a) Rental Income for the applicable
twelve (12) month period of time in question, less (b) the amount of Operating Expenses for
such period of time.



"Non-Related Party” shall mean a person or entity that is not an Affiliate of any Borrower or
Guarantor.



"North Texas Neurology Project” shall mean the North Texas Neurology Property and the
Improvements thereon.



"North Texas Neurology Property” shall mean the real property described in Exhibit A-6
attached hereto.



"Note” or “Notes” means a promissory note or notes substantially in the form of
Exhibit D, executed and delivered by Borrower payable to the order of a Lender, and
delivered pursuant to Section 2.2 or any other provision hereof, as the same may be
modified, amended, supplemented or replaced from time to time.



"Notice of Borrowing” has the meaning set forth in Section 4.3 and shall be in the
form of Exhibit G.



"Nutfield Professional Park Project” shall mean the Nutfield Professional Park Property and
the Improvements thereon.



"Nutfield Professional Park Property” shall mean the real property described in
Exhibit A-4 attached hereto.



"Obligations” means all indebtedness and obligations owing by Borrower to Administrative Agent
and/or Lenders under the Loan Documents.



"OFAC” means the U.S. Department of the Treasury’s Office of Foreign Assets Control.



"Operating Expenses” shall mean any and all costs and expenses incurred in connection with the
Projects (or which should have been incurred to operate and maintain the Projects in a first class
manner) during the applicable three-month time period in question as reasonably determined by
Administrative Agent, including without limitation (a) taxes and assessments imposed upon the
Projects which are reasonably allocable to such time period, (b) bond assessments which are
reasonably allocable to such time period, (c) insurance premiums for casualty insurance and
liability insurance carried in connection with the Projects which are reasonably allocable to such
time period, (d) operating expenses incurred by Borrower for the management, operation, cleaning,
leasing, maintenance and repair of the Projects which are reasonably allocable to such time period,
including the greater of (i) the actual management fee as approved by Administrative Agent and
(ii) three percent (3.0%), and (e) a sufficient replacement reserve (based on an annual rate of
$0.10 per foot), but excluding depreciation, debt service and capital expenditures). Operating
Expenses shall not include any depreciation, interest, principal, loan fees or other payments on
the Loan.



"Other Taxes” means all present or future stamp or documentary taxes or any other excise or
property taxes, charges or similar levies arising from any payment made hereunder or under any
other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect
to, this Agreement or any other Loan Document.



"Permitted Exceptions” means the matters approved by Administrative Agent as permitted
exceptions of title with respect to a Property and set forth as exceptions to title in the Title
Insurance Policy for such Property approved by Administrative Agent.



"Person” shall mean a natural person, a partnership, a joint venture, an unincorporated
association, a limited liability company, a corporation, a trust, any other legal entity, or any
Governmental Authority.



"Plans and Specifications” shall mean the “as built” plans and specifications for the
Improvements, if any.



"Prime Rate” means that interest rate so denominated and set by Wachovia Bank from time to
time as an interest rate basis for borrowings. The Prime Rate is but one of several interest rate
bases used by Wachovia Bank. Wachovia Bank lends at interest rates above and below the Prime Rate.



"Projects” shall mean, collectively the UnitedHealth Group Building Project, the Academy
Medical Center Project, the Epler B Project, the Nutfield Professional Park Project, the Winghaven
Project, the North Texas Neurology Project and the Lonestar Endoscopy Project.



"Properties” shall mean, collectively the UnitedHealth Group Building Property, the Academy
Medical Center Property, the Epler B Property, the Nutfield Professional Park Property, the
Winghaven Property, the North Texas Neurology Property and the Lonestar Endoscopy Property.



"Ratable Share” means, with respect to any Lender on any date, the ratio of (a) the amount of
the Commitment of such Lender to (b) the Aggregate Commitment.



"Register” has the meaning set forth in Section 13.1(c).



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



"Rental Income” shall mean the rental income received by Borrower, as reasonably determined by
Administrative Agent, for the three (3) month period of time in question from the tenant Leases of
the Improvements which are then in effect (and as to which the tenants thereunder are in possession
and paying rent, and are not in default).



"Required Lenders” shall mean, (i) at any particular time that there are three (3) or more
Lenders, Lenders having at least 66-2/3% of the Aggregate Commitment or, if the Aggregate
Commitment has been terminated, Lenders having at least 66-2/3% of the aggregate amount of the
Loans then outstanding or (ii) at any particular time that there are two (2) or less Lenders, all
the Lenders; provided in each case that the Commitment of, and the portion of the Loans
held by, any Defaulting Lender shall be excluded for purposes of determining Required Lenders.



"Responsible Officer” means as to Borrower or any of its Subsidiaries, any of the chief
executive officer, president, any vice president or chief financial officer of the with respect to
Borrower or such Subsidiary and, with respect to financial matters and matters, any of the chief
financial officer or treasurer with respect to Borrower or such Subsidiary.



"Subordination of Property Management Agreement” shall mean each Subordination of Property
Management Agreement of even date herewith executed by a Borrower and property manager, in form and
content satisfactory to Administrative Agent.



"Subsidiary” shall mean, as to any Person, a corporation, limited liability company or other
entity of which shares of stock or other ownership interests having ordinary voting power (other
than stock or such other ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers of such corporation,
limited liability company or other entity are at the time owned, or the management of which is
otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such
Person, and with respect to Borrower shall include all Subsidiaries of Subsidiaries of Borrower,
provided that no joint venture will be a Subsidiary. Unless otherwise specified, “Subsidiary”
means a Subsidiary of the Borrower (including Subsidiaries of Subsidiaries).



"Swap Contract” shall mean any agreement, whether or not in writing, relating to any
transaction that is a rate swap, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap or option, bond, note or bill option, interest rate option,
forward foreign exchange transaction, interest cap, collar or floor transaction, currency swap,
cross-currency rate swap, swap option, currency option or any other similar transaction (including
any option to enter into the foregoing) or any combination of the foregoing, and, unless the
context otherwise clearly requires, any form of master agreement published by the International
Swaps and Derivatives Association, Inc., or any other master agreement, together with any related
schedules and confirmations, as amended, supplemented, superseded or replaced from time to time,
relating to or governing any or all of the foregoing.



"Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings,
assessments, fees or other charges imposed by any Governmental Authority, including any interest,
additions to tax or penalties applicable thereto.



"Title Company” shall mean Stewart Title Guaranty Company or such other title insurance
company as Administrative Agent may approve from time to time.



"Title Insurance Policies” shall mean the title insurance policies insuring the liens of the
Deeds of Trust, each in the form of an American Land Title Association Loan Policy (2006) extended
coverage (without revision, modification or amendment) issued by the Title Company, in form and
substance satisfactory to Administrative Agent and containing such endorsements as Administrative
Agent may require.



"Tranche One Projects” shall mean, collectively the UnitedHealth Group Building Project, the
Epler B Project and the Nutfield Professional Park Project and the North Texas Neurology Project.



"Tranche Three Holdback” shall mean Loan proceeds in an amount equal to $11,253,000, but in no
event more than the amount that would allow the satisfaction of the conditions set forth in
Section 4.10(a)(viii).



"Tranche Three Projects” shall mean, collectively, the Lonestar Endoscopy Project and the
Winghaven Project.



"Tranche Two Holdback” shall mean Loan proceeds in an amount equal to $5,016,000, but in no
event more than the amount that would allow the satisfaction of the conditions set forth in
Section 4.9(a)(viii).



"Tranche Two Project” shall mean the Academy Medical Center Project.



"Treasury Note Rate” shall mean the yields reported, as of 10:00 a.m. (New York time) on any
Business Day (hereinafter defined), on the display designated as “Page 678” on the Telerate Data
Service (or such other display as may replace Page 678 on the Telerate Data Service) for actively
traded U.S. Treasury securities having a maturity equal to ten (10) years, or if such yields shall
not be reported as of such time or the yields reported as of such time shall not be ascertainable,
the latest Treasury Constant Maturity Series yields reported, for the latest day for which such
yields shall have been so reported as of the applicable Business Day, in Federal Reserve
statistical Release H. 15 (519) (or any comparable successor publication) for actively traded U.S.
Treasury securities having a constant maturity equal to ten (10) years. Such implied yield shall
be determined, if necessary, by (i) converting U.S. Treasury bill quotations to bond-equivalent
yields in accordance with accepted financial practice and (ii) interpolating linearly between
reported yields. The term “Business Day” as used in this paragraph only means a day on which banks
are open for business in New York, New York.



"UnitedHealth Group Building Project” shall mean the UnitedHealth Group Building Property and
the Improvements thereon.



"UnitedHealth Group Building Property” shall mean the real property described in
Exhibit A-1 attached hereto.



"Unmatured Event of Default” shall mean an event or condition which with notice or lapse of
time, or both, would become an Event of Default.



"Wachovia Bank” means Wachovia Financial Services, Inc., a North Carolina corporation.



"Winghaven Project” shall mean the Winghaven Property and the Improvements thereon.



"Winghaven Property” shall mean the real property described in Exhibit A-5 attached
hereto.



1.2 Accounting Terms. For purposes of this Agreement, all accounting terms not otherwise
defined herein or in the Recitals shall have the meanings assigned to them in conformity with
generally acceptable accounting standards and principles, consistently applied (“GAAP”).



ARTICLE II




THE LOANS




2.1 Agreement to Lend and Borrow.



(a) Subject to the terms and conditions of this Agreement, each Lender severally agrees to
make Loans to Borrower from time to time through the Maturity Date in an aggregate principal amount
not to exceed the amount set forth on Exhibit E attached hereto for each such Lender (such
Lender’s obligations to make Loans in such amounts pursuant to the terms of this Agreement, being
referred to herein as such Lender’s “Commitment”). The initial advance of Loan proceeds in the
amount of $34,052,500 shall be disbursed in one disbursement by Lenders through escrow for the
purposes of financing the Properties and operating the Projects in accordance with this Agreement,
and other uses reasonably approved by Lender. All amounts advanced under the Loans and repaid may
not be re-borrowed.



(b) Administrative Agent and Lenders shall not have any obligation to make any Loan that would
have the effect of increasing the aggregate amount of all Loans made by all Lenders hereunder to an
amount exceeding the Aggregate Commitment.



2.2 Evidence of Indebtedness. The Loans made by the Lenders pursuant hereto shall be
evidenced by Notes, payable to the order of each Lender in the amount of its Commitment and
evidencing the obligation of Borrower to pay the aggregate unpaid principal amount of the Loans
made by such Lender, with interest thereon (with respect to the portion of the Loan then advanced)
as prescribed in Section 2.3. Each Lender is hereby authorized to record electronically or
otherwise the date and amount of each Loan disbursement made by such Lender, and the date and
amount of each payment or prepayment of principal thereof, and any such recordation shall be
conclusive absent manifest error as to the accuracy of the information so recorded;
provided, however, the failure of such Lender to make, or any error in making, any
such recordation(s) shall not affect the obligation of Borrower to repay outstanding principal,
interest, or any other obligation due hereunder or under the Notes in accordance with the terms
hereof and thereof.



2.3 Interest Rate.



(a) Payment. The Loans shall bear interest on the unpaid principal amount thereof at
a rate per annum equal to the LIBOR Rate. Interest shall be payable in arrears and shall be due on
the first day of each calendar month and on the Maturity Date (as it may be extended) and on the
date the outstanding principal amount of the Notes is repaid in full.



(b) Rate after Default. If all or a portion of the principal amount of any of the
Loans made hereunder or any installment of interest on any Loan shall not be paid when due (whether
at the stated maturity, by acceleration or otherwise and after any applicable opportunity to cure),
any such overdue principal amount and, to the extent permitted by applicable law, any overdue
installment of interest on any Loan shall, without limiting any other rights of the Lenders, bear
interest, payable on demand, for each day until paid at a rate per annum equal to the sum of 4%
plus the LIBOR Rate. After the occurrence and during the continuance of an Event of Default, the
principal amount of the Loans (and, to the extent permitted by applicable law, all accrued interest
thereon) may, at the election of the Required Lenders, bear interest at a rate per annum equal to
the sum of 4% plus the LIBOR Rate.



(c) Computation of Interest. Interest in respect of the Loans shall be calculated on
the basis of a 360-day year for the actual days elapsed. Each determination of an interest rate by
Administrative Agent pursuant to any provision of this Agreement shall be conclusive and binding on
the Lenders and Borrower in the absence of manifest error.



(d) No Deductions. All payments of principal or interest under the Notes shall be
made without deduction of any present and future taxes, levies, imposts, deductions, charges or
withholdings, which amounts shall be owed and paid by Borrower. Borrower will pay the amounts
necessary such that the gross amount of the principal and interest received by the Lenders is not
less than that required by this Agreement and the Notes.



(e) Late Charge. If any payments under the Notes or any other Loan Documents are not
timely made, Borrower shall also pay to Administrative Agent (for the benefit of the Lenders) a
late charge equal to 4% of each payment past due for 15 or more days. Acceptance by Administrative
Agent of any late payment without an accompanying late charge shall not be deemed a waiver of
Administrative Agent’s right to collect such late charge or to collect a late charge for any
subsequent late payment received.



2.4 Maturity of the Loans. The outstanding principal balance of the Loans, together with
all unpaid accrued interest thereon (not otherwise paid when due), and all other amounts payable by
Borrower with respect to the Notes or pursuant to the terms of any other Loan Documents (not
otherwise paid when due), shall be due and payable in full on the Maturity Date; provided, however,
that the Maturity Date (for purposes of this section, the “Original Maturity Date”), may be
extended for a period (the “First Extension Period”) ending twelve (12) months following the
Original Maturity Date (the “First Extended Maturity Date”), and upon the expiration of the First
Extension Period, may be extended for an additional period (the “Second Extension Period”) ending
twelve (12) months following the First Extended Maturity Date (the “Second Extended Maturity
Date”), upon Borrower’s satisfaction (or waiver in writing by Administrative Agent) of the
following terms and conditions prior to each such extension:



(a) Borrower shall provide Administrative Agent with written notice of Borrower’s request to
exercise its option to extend the maturity date not more than ninety (90) days but not less than
forty-five (45) days prior to (i) the Original Maturity Date, in the case of the First Extension,
and (ii) the First Extended Maturity Date, in the case of the Second Extension;



(b) As of the date of Borrower’s delivery of notice of request to exercise its option to
extend, and as of the date of the commencement of the applicable extension, no Event of Default or
Unmatured Event of Default shall have occurred and be continuing, and Borrower shall so certify in
writing;



(c) Borrower shall certify in writing that all representations and warranties set forth in the
Loan Documents remain true and correct;



(d) The Debt Service Coverage Ratio for the Projects then serving as Collateral for the three
month period immediately preceding the then applicable Maturity Date shall have been at least 1.25
to 1.0;



(e) Immediately prior to the commencement of each extension, Borrower shall pay to
Administrative Agent an extension fee in the amount of one quarter of one percent (0.25%) of the
total outstanding plus undisbursed Loan proceeds, as determined on the Original Maturity Date, in
the case of the First Extension, and as determined on the First Extended Maturity Date, in the case
of the Second Extension;



(f) Borrower shall deliver to Administrative Agent, at Borrower’s sole cost and expense, such
title insurance endorsements reasonably required by Administrative Agent;



(g) Borrower shall have paid all costs and expenses of Administrative Agent and Lenders in
connection with such extension;



(h) Administrative Agent shall have determined, in its reasonable discretion, that the current
leases at the Projects comply with Administrative Agent’s then-current underwriting criteria (which
criteria shall be typical for a project of this type; and



(i) Administrative Agent shall have the right to reallocate the outstanding Loan balance, as
of the first day of the extension period and the first day of the second extension period, between
the Projects and to make corresponding dollar for dollar adjustments to the Adjusted Loan Basis for
each Project. Such reallocation shall be based on Administrative Agent’s determination of the
then-current value of each Project, as determined by Administrative Agent in its reasonable
discretion and in accordance with the underwriting policies and procedures used in connection with
the Loan closing and the Appraisal delivered in connection with such extension. In connection with
any reallocation of the Loan pursuant to this paragraph (j), Administrative Agent shall prepare and
deliver to Borrower a new Schedule 1.1(A) reflecting the revised Adjusted Loan Basis of
each Project, which shall supersede and replace Schedule 1.1(A) attached to this Agreement.



If the Original Maturity Date is extended to the First Extended Maturity Date, or the Second
Extended Maturity Date, as provided above, then the term “Maturity Date” as used herein shall
thereafter mean the First Extended Maturity Date or the Second Extended Maturity Date, as
applicable. Notwithstanding the foregoing or anything else contained herein which may be construed
to the contrary, the Second Extension Period may not come into effect unless the First Extension
Period was previously in effect.



2.5 Principal Amortization; Prepayment. Commencing on July 1, 2009, and continuing on the
first day of each month until all amounts due under the Loan Documents are paid in full (including
any extension periods), Borrower shall make monthly principal amortization payments in arrears in
accordance with this paragraph, which payments shall be applied to the outstanding principal
balance of the Loan. Administrative Agent shall calculate the total amount of principal payments
payable from June 1, 2009 to the Maturity Date based upon a 25-year amortization schedule, an
amortization period which begins on June 1, 2009, an interest rate equal to the LIBOR Rate in
effect as of June 1, 2009 and the outstanding principal balance of the Loan as of June 1, 2009.
The monthly amortization payment shall equal the total amount of principal payable for such period
(calculated as set forth above) divided by the number of monthly payments during such period. The
foregoing notwithstanding, upon (a) any additional advance of Loan funds or (b) application of any
permitted or required prepayment of the Loan (other than the amortization payments required by this
paragraph to the Loan balance, Administrative Agent shall recalculate the amount of the monthly
principal amortization payment owing for the remainder of the Loan term, based upon the new
outstanding principal balance and the LIBOR Rate then in effect, and such revised principal
amortization payment shall be due commencing on the first day of the month immediately following
the month in which such additional advance or prepayment (as applicable) is made. If the term of
the Loan is extended in accordance with Section 2.4, the amount of the monthly principal
amortization payment owing during such extension period shall continue in effect based upon the
original 25-year amortization schedule. Administrative Agent’s determination of the amount of the
monthly amortization payments to be made by Borrower hereunder shall be conclusive absent manifest
error. Subject to Section 2.9(b), Section 2.16 and Section 13.30 hereof,
the Loans may be prepaid in whole or in part at any time.



2.6 Security. Payment of the Notes shall be secured by the following:



(a) The Deeds of Trust;



(b) The Guaranty;



(c) To the extent to which they may be assigned, all other rights, licenses, permits,
franchises, authorizations, approvals and agreements relating to the use, occupancy or operation of
the Projects; and



(d) The Financing Statements.



2.7 Fees. Borrower shall pay to Wachovia Bank the fees specified in the Fee Letter, at the
time specified in the Fee Letter. All such fees payable to Wachovia Bank under the Fee Letter
shall belong solely to Wachovia Bank, and Wachovia Bank shall not be required to share any such
fees or compensation specified in the Fee Letter with any of the other Lenders (except only to the
extent, if at all, set forth in a separate written agreement between Wachovia Bank and any of such
other Lenders). Lenders agree to not pursue Borrower for any fees paid to Wachovia Bank under the
Fee Letter.



2.8 Increased Costs.



(a) If any Change in Law shall: (i) impose, modify or deem applicable any reserve, special
deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with
or for the account of, or credit extended or participated in by, any Lender; (ii) subject any
Lender to any tax of any kind whatsoever with respect to this Agreement or any Loan made by it, or
change the basis of taxation of payments to such Lender in respect thereof (except for Indemnified
Taxes or Other Taxes covered by Section 2.11 and the imposition of, or any change in the
rate of, any Excluded Tax payable by such Lender); or (iii) impose on any Lender or the London
interbank market any other condition, cost or expense affecting this Agreement or Loans made by
such Lender or participation therein; and the result of any of the foregoing shall be to increase
the cost to such Lender of making or maintaining any Loan (or of maintaining its obligation to make
any such Loan), or to reduce the amount of any sum received or receivable by such Lender hereunder
(whether of principal, interest or any other amount) then, upon request of such Lender, Borrower
will pay to such Lender such additional amount or amounts as will compensate such Lender for such
additional costs incurred or reduction suffered.



(b) If any Lender determines that any Change in Law affecting such Lender or any Lending
Office of such Lender or such Lender’s holding company, if any, regarding capital requirements has
or would have the effect of reducing the rate of return on such Lender’s capital or on the capital
of such Lender’s holding company, if any, as a consequence of this Agreement, the Commitment of
such Lender or the Loans made by, such Lender, to a level below that which such Lender or such
Lender’s holding company could have achieved but for such Change in Law (taking into consideration
such Lender’s policies and the policies of such Lender’s holding company with respect to capital
adequacy), then from time to time Borrower will pay to such Lender such additional amount or
amounts as will compensate such Lender or such Lender’s holding company for any such reduction
suffered.



2.9 Payments; Pro Rata Treatment.



(a) Each borrowing by Borrower from the Lenders hereunder, each payment (including each
prepayment) by Borrower on account of principal of and interest on the Loans, and each payment by
Borrower on account of any reduction of the Commitments, shall be made to Administrative Agent for
the benefit of Lenders on a pro rata basis according to the respective Lenders’ Ratable Shares;
provided that any Defaulting Lender shall not be entitled to its Ratable Share of any such
payment by Borrower until such time as such Defaulting Lender has paid its Ratable Share of all
borrowing payable by it hereunder, together with interest thereon (as provided in Section
2.13(a)), to Administrative Agent in accordance with the terms of this Agreement. All payments
(including prepayments) to be made by Borrower hereunder and under the Notes, whether on account of
principal, interest, fees or otherwise, shall be made without set-off or counterclaim and shall be
made prior to 1:00 p.m., Charlotte, North Carolina time, on the due date thereof to Administrative
Agent, for the account of the Lenders, at Administrative Agent’s office at 301 South College
Street, Charlotte, North Carolina, or at such other office as directed by Administrative Agent from
time to time, in Dollars and in immediately available funds. Administrative Agent shall promptly
distribute such payments to the Lenders upon receipt in like funds as received. If any payment
hereunder becomes due and payable on a day other than a Business Day, such payment shall be
extended to the next succeeding Business Day (and, with respect to payments of principal, interest
thereon shall be payable at the then applicable rate during such extension) unless the result of
such extension would be to extend such payment into another calendar month, in which event such
payment shall be made on the immediately preceding Business Day.



(b) Subject to Section 13.30 hereof, Borrower may from time to time pay all
outstanding Loans, or, in a minimum aggregate amount of $1,000,000 or any integral multiple of
$100,000 in excess thereof, any portion of the outstanding Loans upon notice to Administrative
Agent not later than 1:00 p.m. Charlotte, North Carolina time on the date of payment;
provided, that, notwithstanding the foregoing, no more than two prepayments of Loans may be
made each calendar month. Notwithstanding the foregoing, Borrower may make a prepayment in an
amount sufficient to release a Project from the lien of the Loan in accordance with Article XIV
hereof.



(c) In addition to the principal payments otherwise required hereunder, Borrower shall make
mandatory prepayments (“Mandatory Prepayments”) of principal as set forth below. Amounts repaid
hereunder may not be reborrowed.



(i) Borrower shall pay to Administrative Agent for the ratable benefit of Lenders the amounts
required under Section 4.11, as and when required thereunder.



(ii) If Administrative Agent notifies Borrower at any time that the aggregate amount of the
Loans made hereunder exceeds the Aggregate Commitment, then, within two Business Days after receipt
of such notice, Borrower shall prepay the outstanding principal amount of the Loans in an aggregate
amount sufficient to reduce such outstanding principal as of such date of payment to an amount not
to exceed the Aggregate Commitment.



2.10 Designation of a Different Lending Office. If any Lender requests compensation under
Section 2.8, or requires Borrower to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.11, then such
Lender, unless directed by Borrower not to do so, shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of
such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant
to Section 2.8 or Section 2.11, as the case may be, in the future and (ii) would
not subject such Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. Borrower hereby agrees to pay all reasonable costs and expenses
incurred by any Lender in connection with any such designation or assignment.



2.11 Taxes.



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



(b) Without limiting the provisions of subparagraph (a) above, Borrower shall timely
pay any Other Taxes to the relevant Governmental Authority prior to delinquency in accordance with
applicable law.



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



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



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



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



(g) Notwithstanding anything in this Section 2.11 to the contrary, Administrative
Agent and Lenders hereby agree that Borrower shall not be required to pay, reimburse, set off or
otherwise be responsible for any taxes, including without limitation any Indemnified Taxes, Other
Taxes or Excluded Taxes (collectively, “Tax Reimbursements”) which are attributable to a period
more than one hundred eighty (180) days prior to the date on which Borrower receives notice of its
obligation to pay such Tax Reimbursements.



2.12 Survival of Indemnity. Determination of amounts payable under Section 2.8
shall be calculated as though each Lender funded its Loan through the purchase of a deposit of the
type and maturity corresponding to the deposit used as a reference in determining the interest rate
applicable to such Loan, whether in fact that is the case or not. The obligations of Borrower
under Section 2.8 and Section 2.11 shall survive repayment of the Notes and
termination of this Agreement.



2.13 Funding by Lenders; Payments by Borrower; Presumptions by Administrative Agent.



(a) Unless Administrative Agent shall have received notice from a Lender prior to the proposed
date of any borrowing of Loans that such Lender will not make available to Administrative Agent
such Lender’s Ratable Share of such Loans, Administrative Agent may assume that such Lender has
made such Ratable Share available on such date in accordance with Section 4.3 and may, in
reliance upon such assumption, make available to Borrower a corresponding amount. In such event,
if a Lender has not in fact made its Ratable Share of the Loans available to Administrative Agent,
then the applicable Lender and Borrower severally agree to pay to Administrative Agent forthwith on
demand such corresponding amount with interest thereon, for each day from and including the date
such amount is made available to Borrower to but excluding the date of payment to Administrative
Agent, at (i) in the case of a payment to be made by such Lender, the Federal Funds Rate and
(ii) in the case of a payment to be made by Borrower, the interest rate applicable to Loans. If
Borrower and such Lender shall pay such interest to Administrative Agent for the same or an
overlapping period, Administrative Agent shall promptly remit to Borrower the amount of such
interest paid by Borrower for such period. If such Lender pays its Ratable Share of Loans to
Administrative Agent, then the amount so paid shall constitute such Lender’s Loan. Any payment by
Borrower shall be without prejudice to any claim Borrower may have against a Lender that shall have
failed to make such payment to Administrative Agent.



(b) Unless Administrative Agent shall have received notice from Borrower prior to the date on
which any payment is due to Administrative Agent for the account of the Lenders hereunder that
Borrower will not make such payment, Administrative Agent may assume that Borrower has made such
payment on such date in accordance herewith and may, in reliance upon such assumption, distribute
to the Lenders, as the case may be, the amount due. In such event, if Borrower has not in fact
made such payment, then each of the Lenders, as the case may be, severally agrees to repay to
Administrative Agent forthwith on demand the amount so distributed to such Lender, with interest
thereon, for each day from and including the date such amount is distributed to it to but excluding
the date of payment to Administrative Agent, at the Federal Funds Rate.



2.14 Replacement of Lenders. If any Lender requests compensation under
Section 2.8, or if Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.11, or if any
Lender is a Defaulting Lender, then Borrower may, at its sole expense and effort, upon notice to
such Lender and Administrative Agent, require such Lender to assign and delegate, without recourse
(in accordance with and subject to the restrictions contained in, and consents required by,
Section 13.1), all of its interests, rights and obligations under this Agreement and the
related Loan Documents to an Eligible Assignee that shall assume such obligations (which Eligible
Assignee may be another Lender, if a Lender accepts such assignment), provided that:
(a) Borrower shall have paid to Administrative Agent the assignment fee specified in
Section 13.1; (b) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder and under the other Loan Documents from the assignee (to the extent of such
outstanding principal and accrued interest and fees) or Borrower (in the case of all other
amounts); (c) in the case of any such assignment resulting from a claim for compensation under
Section 2.8 or payments required to be made pursuant to Section 2.11 such
assignment will result in a reduction in such compensation or payments thereafter; and (d) such
assignment does not conflict with applicable law. A Lender shall not be required to make any such
assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise,
the circumstances entitling Borrower to require such assignment and delegation cease to apply.


2.15 Adjustments to Adjusted Loan Basis. The Adjusted Loan Basis for each Project shall be
decreased dollar for dollar for prepayments of Loan principal which relate directly to such Project
(e.g., casualty or condemnation proceeds or payments made in connection with the release of a
Project in accordance with Section 14.3). Any prepayment of principal not directly related
to a specific Project shall be allocated by Administrative Agent to the Projects, on a pro rata
basis, in accordance with each Project’s Adjusted Loan Basis.

3





2.16 Indemnity. Borrower agrees to indemnify each Lender and to hold each Lender harmless
from any loss or expense which such Lender sustains or incurs (other than through such Lender’s
negligence or willful misconduct) as a consequence of (a) default by Borrower in making any
prepayment of a Loan after Borrower has given a notice thereof in accordance with the provisions of
this Agreement or (b) the making of a prepayment of Loans on a day which is not the last day of an
Interest Period with respect thereto (whether by acceleration, demand, required assignment or
otherwise). Such indemnification may include, without limitation, an amount equal to the excess,
if any, of (i) the amount of interest which would have accrued on the amount so prepaid or not so
borrowed for the period from the date of such prepayment or of such failure to borrow to the last
day of the applicable Interest Period (or, in the case of a failure to borrow the Interest Period
that would have commenced on the date of such failure) in each case at the applicable rate of
interest for such portion of the Loan provided for herein over (ii) 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 LIBOR
market. By its initials below, Borrower waives any right under California Civil Code Section
2954.10 or otherwise to prepay any Loan, in whole or in part, without payment of any and all
amounts specified above in this Section 2.16 (the “Breakage Amounts”). Borrower
acknowledges that prepayment of any Loan may result in Lenders’ incurring additional losses, costs,
expenses and liabilities, including lost revenues and lost profits. Borrower therefore agrees to
pay any and all Breakage Amounts if any Loan is prepaid, whether voluntarily or by reason of
acceleration, including acceleration upon any transfer or conveyance of any right, title or
interest in the Project giving Administrative Agent on behalf of Lenders the right to accelerate
the maturity of the Loans as provided in the Loan Documents. Borrower agrees that Lenders’
willingness to offer the LIBOR Rate to Borrower is sufficient and independent consideration, given
individual weight by Lenders, for this waiver. Borrower understands that Lenders would not offer
the LIBOR Rate to Borrower absent this waiver.



	 	 	 
	_/s/ AB     

UnitedHealth Group Building Borrower

_/s/ AB     

Epler B Borrower

_/s/ AB     

	 	_/s/ AB     

Academy Medical Center Borrower

_/s/ AB     

Nutfield Professional Park Borrower









Cirrus Borrower

4





ARTICLE III




CONDITIONS PRECEDENT




3.1 Closing. Administrative Agent’s and the Lender’s obligations to close the Loans and
perform under this Agreement are expressly conditioned upon (i) Borrower’s satisfaction (or waiver
in writing by Administrative Agent) of all of the conditions set forth in Exhibit F hereto;
(ii) Borrower’s satisfaction (or waiver in writing by Administrative Agent) of the conditions for
disbursement set forth in Article IV (as applicable); (iii) the Title Company’s
unconditional commitment to issue the Title Insurance Policies; and (iv) Borrower’s delivery to
Administrative Agent (or waiver in writing by Administrative Agent) of the following documents, in
form and content satisfactory to Administrative Agent, duly executed (and acknowledged where
necessary) by the appropriate parties thereto:



(a) This Agreement;



(b) The Notes;



(c) The Deeds of Trust for the Tranche One Projects, each of which shall be duly recorded in
the official records of the County in which the Project encumbered thereby is located;



(d) The Financing Statements for the Tranche One Projects, which shall be duly filed with the
Delaware Secretary of State;



(e) The Guaranty;



(f) The Environmental Indemnities for the Tranche One Projects;



(g) Assignments of all other agreements, contracts, rights, permits, licenses, entitlements,
authorizations, and franchises relating to the Tranche One Projects, and consents to such
assignments where deemed appropriate by Administrative Agent;



(h) A Subordination of Property Management Agreement for each Tranche One Project;



(i) The Fee Letter; and



(j) Such other documents that Administrative Agent may reasonably require.



ARTICLE IV




LOAN DISBURSEMENTS




4.1 Recordation Disbursements. Upon recordation of the Deeds of Trust for the Tranche One
Projects (or such earlier Closing Date) and satisfaction of all conditions set forth herein (or
waiver in writing by Administrative Agent), provided that the Title Company has issued or
irrevocably committed in writing to issue to Administrative Agent the Title Insurance Policies
referred to in Section 5.1 hereof, Lenders shall disburse $34,052,500 of Loan proceeds.



4.2 Intentionally Omitted.



4.3 Notice of Borrowing. Borrower may request subsequent disbursements by giving to
Administrative Agent written notice, substantially in the form of Form of Exhibit G hereto
(the “Notice of Borrowing”) signed by a Responsible Officer, which Notice of Borrowing must be
received at least five (5) Business Days prior to the date of the requested Loans. Each Notice of
Borrowing shall be irrevocable. Each Notice of Borrowing shall specify (i) the Borrowing Date
(which shall be a Business Day), and (ii) the amount of the requested Loans. Upon receipt of a
Notice of Borrowing, Administrative Agent shall promptly (i) notify each Lender of the contents
thereof and of such Lender’s ratable share of the requested Loans and (ii) provide each Lender a
copy of the Notice of Borrowing.



4.4 Availability of Funds. Subject to satisfaction of the terms and conditions of this
Agreement, each Lender shall deposit funds with Administrative Agent for the account of Borrower by
2:00 p.m. Charlotte, North Carolina time on the Borrowing Date by wire transfer or other
immediately available funds equal to its Ratable Share of the Loans to be made on the Borrowing
Date. Except as provided above, the Loans will then be disbursed to Borrower by Administrative
Agent crediting the account of Borrower on the books of Administrative Agent with the aggregate
amounts made available to Administrative Agent by the Lenders, and in like funds as received by
Administrative Agent.



4.5 Lending Offices. Each Lender may book its Loans at any Lending Office selected by such
Lender and may change its Lending Office from time to time. All terms of this Agreement shall
apply to any such Lending Office and the Loans and the Notes issued hereunder shall be deemed held
by each Lender for the benefit of any such Lending Office. Each Lender may, by written notice to
Administrative Agent and Borrower in accordance with Section 13.2, designate replacement or
additional Lending Offices through which Loans will be made by it and for whose account Loan
payments are to be made.



4.6 Intentionally Omitted.



4.7 Method of Loan Advances. Loan Advances shall be disbursed directly to Borrower,
provided however, that in the event that Administrative Agent determines that Borrower has failed
to honor any obligation under the Loan Documents, then Administrative Agent may, at Administrative
Agent’s option, disburse Loan advances (a) directly to Borrower, (b) directly to persons supplying
labor, materials and services in connection with the Improvements, or (c) jointly to Borrower and
said persons.



4.8 Limitations and Conditions on Loan Advances. Borrower shall be entitled to Loans only
in accordance with the terms and conditions of this Agreement (unless waived or modified by
Administrative Agent) and, in addition, the following conditions (unless waived or modified by
Administrative Agent):



(a) The representations and warranties of Borrower contained in all of the Loan Documents
shall be correct in all material respects on and as of the date of the disbursement as though made
on and as of that date and no Event of Default or Unmatured Event of Default shall have occurred
and be continuing as of the date of the disbursement;



(b) No mechanics’ lien shall have been recorded against any Property; and;



(c) Administrative Agent shall be satisfied that the advance will not be junior in priority to
any mechanics’ or materialmen’s liens, deeds of trust, mortgages or any intervening or other liens
on any Property other than Permitted Exceptions; and



(d) Administrative Agent shall not be required to disburse any requested Loans before five (5)
days after the receipt of the applicable Notice of Borrowing, and in any event until all applicable
conditions and requirements in this Agreement have been satisfied.



4.9 Tranche Two Holdback. Administrative Agent and Lenders shall have no obligation to
disburse any portion of the Tranche Two Holdback unless and until Borrower complies with each of
the following conditions (or any such conditions are waived in writing by Administrative Agent):



(a) Conditions Precedent. In addition to Borrower satisfying the conditions precedent
to funding and disbursement of Loan proceeds set out in Section 3.1 above and in
Article IV hereof (including without limitation Section 4.8), the following
conditions precedent shall have been satisfied or waived in writing (and each delivery below shall
be subject to Administrative Agent’s receipt, review, approval and/or confirmation, at Borrower’s
cost and expense, each in form and substance satisfactory to Administrative Agent):




(i) Each Tranche Two Project shall be acquired by a Borrower prior to or
concurrently with such advance;




(ii) Administrative Agent shall have received an Environmental Indemnity for
each Tranche Two Project and a Deed of Trust covering each Tranche Two Project and
all personal property related thereto (and such Deeds of Trust shall have been or
concurrently shall be properly recorded in the official records of the counties in
which the Tranche Two Projects are located);




(iii) Each Borrower acquiring a Tranche Two Project shall have authorized
Administrative Agent to file a Financing Statement with the Secretary of State of
such Borrower’s formation;




(iv) With respect to any Tranche Two Project subject to a ground lease, if any,
Administrative Agent shall have approved the ground lease and shall have received a
Consent to Encumbrance covering the Tranche Two Project in form and substance
acceptable to Administrative Agent in its sole discretion (and such consent to
encumbrance shall have been properly recorded in the official records of the county
in which the applicable Tranche Two Project is located);




(v) Administrative Agent shall have received Title Insurance Policies insuring
that the Deeds of Trust for the Tranche Two Projects as first priority lien on the
Tranche Two Project and related collateral subject to the Permitted Encumbrances.
Borrower shall also obtain, at its sole cost and expense, any endorsements,
continuations or modifications to any existing Title Insurance Policies as
Administrative Agent may reasonably request, including without limitation
aggregation or tie-in endorsements;




(vi) Administrative Agent shall have received legal opinions issued by counsel
for Borrower, opining as to the due authorization, execution, delivery,
enforceability and validity of the Tranche Two Projects Deeds of Trust and
Environmental Indemnities and as to such other matters as Administrative Agent and
Administrative Agent’s counsel reasonably may specify;




(vii) Administrative Agent shall have received an Appraisal of each Tranche Two
Project, in form and content satisfactory to Administrative Agent in its sole and
absolute discretion, and such information regarding each Tranche Two Project as
Administrative Agent shall request, including without limitation financial
information, historic rent rolls and operating statements;




(viii) After giving effect to the addition of the Tranche Two Projects to the
Collateral and disbursement of the Tranche Two Holdback, the Debt Service Coverage
Ratio shall equal or exceed 1.25:1.00 as determined by Administrative Agent in its
sole and absolute discretion, and the Loan-to-Value Ratio shall not exceed sixty-six
percent (66%) as determined by Administrative Agent in its sole and absolute
discretion.




(ix) Administrative Agent shall have received UCC searches for the sellers of
the Tranche Two Projects which are acceptable to Administrative Agent;




(x) Administrative Agent shall have received one copy, if any, of Borrower’s
agreements with any property manager(s) for the Tranche Two Projects;




(xi) Administrative Agent shall have received evidence of insurance as required
by this Agreement with respect to the Tranche Two Projects;




(xii) Administrative Agent shall have received a current ALTA/ACSM land title
survey of the Tranche Two Project, dated or updated to a date not earlier than
thirty (30) days prior to the date hereof, certified to Administrative Agent,
Lenders and the Title Company, prepared by a licensed surveyor acceptable to
Administrative Agent and the Title Company, and conforming to Administrative Agent’s
current standard survey requirements;




(xiii) Administrative Agent shall have received true and correct copies, to the
extent in Borrower’s possession, of the “as built” Plans and Specifications and a
current engineering report or architect’s certificate with respect to each
Tranche Two Project, covering, among other matters, inspection of heating and
cooling systems, roof and structural details and showing no failure of compliance
with building plans and specifications, applicable legal requirements (including
requirements of the Americans with Disabilities Act) and fire, safety and health
standards;




(xiv) Administrative Agent shall have received a current environmental site
assessment for each Tranche Two Project performed by an environmental engineer that
is acceptable to Administrative Agent, and which assessment shall be in form and
substance satisfactory to Administrative Agent, in Administrative Agent’s sole
discretion. Such report shall be addressed to such persons as Administrative Agent
may require;




(xv) Administrative Agent shall have received a soils test report prepared by a
licensed soils engineer reasonably satisfactory to Administrative Agent showing the
locations of, and containing boring logs for, all borings, together with
recommendations for the design of the foundations, paved areas and underground
utilities for each Tranche Two Project;




(xvi) Administrative Agent shall have received evidence satisfactory to
Administrative Agent, as to whether (i) each Tranche Two Project is located in an
area designated by the Department of Housing and Urban Development as having special
flood or mudslide hazards, and (ii) the community in which each Tranche Two Project
is located is participating in the National Flood Insurance Program;




(xvii) Administrative Agent shall have received current operating statements
and a current rent roll of each Tranche Two Project, which Borrower shall represent
and warrant is true and correct to the best of its knowledge. Such rent roll shall
include the following information: (a) tenant names; (b) unit/suite numbers; (c)
area of each demised premises and total area of each Tranche Two Project (stated in
net rentable square feet); (d) rental rate (including escalations) (stated in gross
amount and in amount per net rentable square foot per year); and (e) security
deposit, if any;




(xviii) Administrative Agent shall have received leases, estoppel certificates
and subordination, non-disturbance and attornment agreements (in form and substance
acceptable to Administrative Agent) from such tenants at each Tranche Two Project as
required by Administrative Agent;




(xix) Administrative Agent shall have received evidence satisfactory to
Administrative Agent that all real estate taxes, assessments, water, sewer or other
charges levied or assessed against the Tranche Two Projects have been paid in full
prior to delinquency;




(xx) Administrative Agent shall have received evidence satisfactory to
Administrative Agent that (i) telephone service, electric power, storm sewer,
sanitary and water facilities are available to each Tranche Two Project; (ii) such
utilities are adequate to serve each Tranche Two Projects and exist at the
boundaries of each Tranche Two Project; and (ii) no conditions exist to affect
Borrower’s right to connect into and have unlimited use of such utilities except for
the payment of a normal connection charge and except for the payment of subsequent
charges for such services to the utility supplier. Administrative Agent shall also
have received evidence satisfactory to Administrative Agent that all permits
(including building permits), variances, zoning approvals, or other required
permissions for the operation and occupancy of each Tranche Two Project are in
existence, and that each Tranche Two Project is in full compliance with all Federal,
State and local laws, and all rules or regulation governing the protection of the
environment. At Administrative Agent’s request, Borrower shall furnish
Administrative Agent with a zoning endorsement to the Title Insurance Policies,
zoning letters from applicable municipal agencies, and utility letters from
applicable service providers or other reasonable proof that required utilities are
available to each Tranche Two Project;




(xxi) Administrative Agent shall have received a copy of all other inspection
and test reports made by or for Borrower in connection with each Tranche Two
Project;




(xxii) No condemnation or adverse zoning or usage change proceeding shall have
occurred or shall have been threatened against any Tranche Two Project; no
Tranche Two Project shall have suffered any significant damage by fire or other
casualty which has not been repaired; no law, regulation, ordinance, moratorium,
injunctive proceeding, restriction, litigation, action, citation or similar
proceeding or matter shall have been enacted, adopted, or threatened by any
governmental authority, which would have, in Administrative Agent’s judgment, a
material adverse effect on any Tranche Two Project or the acquirer of any
Tranche Two Project;




(xxiii) All fees and commissions payable to real estate brokers, mortgage
brokers, or any other brokers or agents in connection with the Loan or the
acquisition of any Tranche Two Project shall have been paid, such evidence to be
accompanied by any waivers or indemnifications deemed necessary by Administrative
Agent;




(xxiv) Administrative Agent shall have received payment of Administrative
Agent’s costs and expenses in underwriting, documenting, and closing the
transaction, including fees and expenses of Administrative Agent’s inspecting
engineers, consultants, and outside counsel; and




(xxv) Administrative Agent shall have received such other authorizations,
documents, certificates, updates, reports, searches or items as Administrative Agent
reasonably may reasonably require with respect to each Tranche Two Project.



(b) Disbursement. Disbursement of the Tranche Two Holdback shall be in one lump sum
in the amount of $5,016,000; provided, however, neither Administrative Agent nor Lenders shall have
any obligation to disburse proceeds allocated to the Tranche Two Holdback if Borrower has not
satisfied all of the condition set forth in Section 4.9(a) on or before July 31, 2008 (or
any such conditions have been waived in writing by Administrative Agent).



4.10 Tranche Three Holdback. Administrative Agent and Lenders shall have no obligation to
disburse any portion of the Tranche Three Holdback unless and until Borrower complies with each of
the following conditions (or any such conditions are waived in writing by Administrative Agent):



(a) Conditions Precedent. In addition to Borrower satisfying the conditions precedent
to funding and disbursement of Loan proceeds set out in Section 3.1 above and in
Article IV hereof (including without limitation Section 4.8), the following
conditions precedent shall have been satisfied or waived in writing (and each delivery below shall
be subject to Administrative Agent’s receipt, review, approval and/or confirmation, at Borrower’s
cost and expense, each in form and substance satisfactory to Administrative Agent):




(i) Each Tranche Three Project shall be acquired by a Borrower prior to or
concurrently with such advance;




(ii) Administrative Agent shall have received an Environmental Indemnity for
each Tranche Three Project and a Deed of Trust covering each Tranche Three Project
and all personal property related thereto (and such Deeds of Trust shall have been
or concurrently shall be properly recorded in the official records of the counties
in which the Tranche Three Projects are located);




(iii) Each Borrower acquiring a Tranche Three Project shall have authorized
Administrative Agent to file a Financing Statement with the Secretary of State of
such Borrower’s formation;




(iv) With respect to any Tranche Three Project subject to a ground lease, if
any, Administrative Agent shall have approved the ground lease and shall have
received a Consent to Encumbrance covering the Tranche Three Project in form and
substance acceptable to Administrative Agent in its sole discretion (and such
consent to encumbrance shall have been properly recorded in the official records of
the county in which the applicable Tranche Three Project is located);




(v) Administrative Agent shall have received Title Insurance Policies insuring
that the Deeds of Trust for the Tranche Three Projects as first priority liens on
the Tranche Three Projects and related collateral subject to the Permitted
Encumbrances. Borrower shall also obtain, at its sole cost and expense, any
endorsements, continuations or modifications to any existing Title Insurance
Policies as Administrative Agent may reasonably request, including without
limitation aggregation or tie-in endorsements;




(vi) Administrative Agent shall have received legal opinions issued by counsel
for Borrower, opining as to the due authorization, execution, delivery,
enforceability and validity of the Tranche Three Projects Deeds of Trust and
Environmental Indemnities and as to such other matters as Administrative Agent and
Administrative Agent’s counsel reasonably may specify;




(vii) Administrative Agent shall have received an Appraisal of each
Tranche Three Project, in form and content satisfactory to Administrative Agent in
its sole and absolute discretion, and such information regarding each Tranche Three
Project as Administrative Agent shall request, including without limitation
financial information, historic rent rolls and operating statements;




(viii) After giving effect to the addition of the Tranche Three Projects to the
Collateral and disbursement of the Tranche Three Holdback, the Debt Service Coverage
Ratio shall equal or exceed 1.25:1.00 as determined by Administrative Agent in its
sole and absolute discretion, and the Loan-to-Value Ratio shall not exceed sixty-six
percent (66%) as determined by Administrative Agent in its sole and absolute
discretion.




(ix) Administrative Agent shall have received UCC searches for the sellers of
the Tranche Three Projects which are acceptable to Administrative Agent;




(x) Administrative Agent shall have received one copy, if any, of Borrower’s
agreements with any property manager(s) for the Tranche Three Projects;




(xi) Administrative Agent shall have received evidence of insurance as required
by this Agreement with respect to the Tranche Three Projects;




(xii) Administrative Agent shall have received a current ALTA/ACSM land title
survey of the Tranche Three Project, dated or updated to a date not earlier than
thirty (30) days prior to the date hereof, certified to Administrative Agent,
Lenders and the Title Company, prepared by a licensed surveyor acceptable to
Administrative Agent and the Title Company, and conforming to Administrative Agent’s
current standard survey requirements;




(xiii) Administrative Agent shall have received true and correct copies, to the
extent in Borrower’s possession, of the “as built” Plans and Specifications and a
current engineering report or architect’s certificate with respect to each
Tranche Three Project, covering, among other matters, inspection of heating and
cooling systems, roof and structural details and showing no failure of compliance
with building plans and specifications, applicable legal requirements (including
requirements of the Americans with Disabilities Act) and fire, safety and health
standards;




(xiv) Administrative Agent shall have received a current environmental site
assessment for each Tranche Three Project performed by an environmental engineer
that is acceptable to Administrative Agent, and which assessment shall be in form
and substance satisfactory to Administrative Agent, in Administrative Agent’s sole
discretion. Such report shall be addressed to such persons as Administrative Agent
may require;




(xv) Administrative Agent shall have received a soils test report prepared by a
licensed soils engineer reasonably satisfactory to Administrative Agent showing the
locations of, and containing boring logs for, all borings, together with
recommendations for the design of the foundations, paved areas and underground
utilities for each Tranche Three Project;




(xvi) Administrative Agent shall have received evidence satisfactory to
Administrative Agent, as to whether (i) each Tranche Three Project is located in an
area designated by the Department of Housing and Urban Development as having special
flood or mudslide hazards, and (ii) the community in which each Tranche Three
Project is located is participating in the National Flood Insurance Program;




(xvii) Administrative Agent shall have received current operating statements
and a current rent roll of each Tranche Three Project, which Borrower shall
represent and warrant is true and correct to the best of its knowledge. Such rent
roll shall include the following information: (a) tenant names; (b) unit/suite
numbers; (c) area of each demised premises and total area of each Tranche Three
Project (stated in net rentable square feet); (d) rental rate (including
escalations) (stated in gross amount and in amount per net rentable square foot per
year); and (e) security deposit, if any;




(xviii) Administrative Agent shall have received leases, estoppel certificates
and subordination, non-disturbance and attornment agreements (in form and substance
acceptable to Administrative Agent) from such tenants at each Tranche Three Project
as required by Administrative Agent;




(xix) Administrative Agent shall have received evidence satisfactory to
Administrative Agent that all real estate taxes, assessments, water, sewer or other
charges levied or assessed against the Tranche Three Projects have been paid in full
prior to delinquency;




(xx) Administrative Agent shall have received evidence satisfactory to
Administrative Agent that (i) telephone service, electric power, storm sewer,
sanitary and water facilities are available to each Tranche Three Project; (ii) such
utilities are adequate to serve each Tranche Three Projects and exist at the
boundaries of each Tranche Three Project; and (ii) no conditions exist to affect
Borrower’s right to connect into and have unlimited use of such utilities except for
the payment of a normal connection charge and except for the payment of subsequent
charges for such services to the utility supplier. Administrative Agent shall also
have received evidence satisfactory to Administrative Agent that all permits
(including building permits), variances, zoning approvals, or other required
permissions for the operation and occupancy of each Tranche Three Project are in
existence, and that each Tranche Three Project is in full compliance with all
Federal, State and local laws, and all rules or regulation governing the protection
of the environment. At Administrative Agent’s request, Borrower shall furnish
Administrative Agent with a zoning endorsement to the Title Insurance Policies,
zoning letters from applicable municipal agencies, and utility letters from
applicable service providers or other reasonable proof that required utilities are
available to each Tranche Three Project;




(xxi) Administrative Agent shall have received a copy of all other inspection
and test reports made by or for Borrower in connection with each Tranche Three
Project;




(xxii) No condemnation or adverse zoning or usage change proceeding shall have
occurred or shall have been threatened against any Tranche Three Project; no
Tranche Three Project shall have suffered any significant damage by fire or other
casualty which has not been repaired; no law, regulation, ordinance, moratorium,
injunctive proceeding, restriction, litigation, action, citation or similar
proceeding or matter shall have been enacted, adopted, or threatened by any
governmental authority, which would have, in Administrative Agent’s judgment, a
material adverse effect on any Tranche Three Project or the acquirer of any
Tranche Three Project;




(xxiii) All fees and commissions payable to real estate brokers, mortgage
brokers, or any other brokers or agents in connection with the Loan or the
acquisition of any Tranche Three Project shall have been paid, such evidence to be
accompanied by any waivers or indemnifications deemed necessary by Administrative
Agent;




(xxiv) Administrative Agent shall have received payment of Administrative
Agent’s costs and expenses in underwriting, documenting, and closing the
transaction, including fees and expenses of Administrative Agent’s inspecting
engineers, consultants, and outside counsel; and




(xxv) Administrative Agent shall have received such other authorizations,
documents, certificates, updates, reports, searches or items as Administrative Agent
reasonably may reasonably require with respect to each Tranche Three Project.



(b) Disbursement. Disbursement of the Tranche Three Holdback shall be in one lump sum
in the amount of $11,253,000; provided, however, neither Administrative Agent nor Lenders shall
have any obligation to disburse proceeds allocated to the Tranche Three Holdback if Borrower has
not satisfied all of the condition set forth in Section 4.10(a) on or before July 31, 2008
(or any such conditions have been waived in writing by Administrative Agent).



4.11 Debt Service Coverage Ratio. At all times during the term of the Loan, the Debt
Service Coverage Ratio shall equal or exceed 1.25:1.00 as determined by Administrative Agent in its
sole and absolute discretion. If for any reason the applicable Debt Service Coverage Ratio is not
met, then Borrower shall, within thirty (30) days after Administrative Agent’s demand, immediately
reduce the unpaid principal balance of the Loan in an amount which would cause the applicable Debt
Service Coverage Ratio to be met.



ARTICLE V




TITLE INSURANCE




5.1 Basic Insurance. Concurrently with the recording of the Tranche One Projects Deeds of
Trust (or such earlier Closing Date), Borrower shall, at Borrower’s sole cost and expense, deliver
or cause to be delivered to Administrative Agent the Title Insurance Policies issued by the Title
Company (and such reinsurers and coinsurers as Administrative Agent may require) with a liability
limit of not less than the full amount of the Aggregate Commitment and with coverage and in form
satisfactory to Administrative Agent, insuring Administrative Agent’s and Lender’s interest under
each Deeds of Trust as a valid first liens on the applicable Project, together with such
reinsurance or coinsurance agreements or endorsements to the Title Insurance Policies as
Administrative Agent may require, which policy shall contain only the Permitted Exceptions from its
coverage, and thereafter Borrower shall, at its own cost and expense, do all things necessary to
maintain each Tranche One Project Deed of Trust as a valid first lien on the applicable Property.
From and after the disbursement of the Tranche Two Holdback, Borrower shall, at its own cost and
expense, do all things necessary to maintain the Tranche Two Project Deed of Trust as a valid first
lien on the Tranche Two Project. From and after the disbursement of the Tranche Three Holdback,
Borrower shall, at its own cost and expense, do all things necessary to maintain each Tranche Three
Project Deed of Trust as a valid first lien on the applicable Property.



5.2 Continuation and Date-Down Endorsements. After recordation of the Tranche One Projects
Deeds of Trust and as a condition precedent to each Loan advance under Article IV above,
Borrower shall (if required by Administrative Agent) at its own cost and expense, deliver or cause
to be delivered to Administrative Agent from time to time such continuation and date-down
endorsements to be attached to the Title Insurance Policies referred to above, in form and
substance satisfactory to Administrative Agent, as Administrative Agent reasonably deems necessary
to insure the priority of the Deeds of Trust as a valid first lien on the Projects as of the date
of and including the amount covered by each such disbursement, and Borrower agrees to furnish to
the Title Company such surveys and other information as are required by Administrative Agent or the
Title Company to enable the Title Company to issue such endorsements to Administrative Agent.



ARTICLE VI




OPERATION AND MAINTENANCE OF THE PROJECT




6.1 Operation as Medical/Commercial Office Buildings. At all times during the term of this
Agreement, Borrower shall itself (or through a manager satisfactory to Administrative Agent)
operate the Projects then serving as Collateral as first class medical/commercial office buildings.



6.2 Maintenance. Borrower shall maintain the Projects then serving as Collateral in good
condition and repair (as is more fully set forth in the Deeds of Trust).



ARTICLE VII




LIABILITY, RISK, AND FLOOD INSURANCE




At all times throughout the Loan term, Borrower shall, at its sole cost and expense, maintain
insurance, and shall pay, as the same becomes due and payable, all premiums in respect thereto,
including, but not necessarily limited to:



7.1 Property. “Special Cause of Loss” insurance on the Improvements in an amount not less
than the full insurable value on a replacement cost basis of the insured Improvements and personal
property related thereto.



7.2 Liability. Insurance protecting Borrower, Administrative Agent and Lenders against
loss or losses from liability imposed by law or assumed in any written contract and arising from
personal injury, including bodily injury or death, having a limit of liability of not less than One
Million Dollars ($1,000,000) (combined single limit for personal injury and property damage) and an
umbrella excess liability policy in an amount not less than Fifteen Million Dollars ($15,000,000)
protecting Borrower and Lender against any loss or liability or damage for personal injury,
including bodily injury or death, or property damage. Such policies must be written on an
occurrence basis so as to provide blanket contractual liability, broad form property damage
coverage, and coverage for products and completed operations.



7.3 Flood. If required by Administrative Agent, a policy or policies of flood insurance in
the maximum amount of flood insurance available with respect to the Projects then serving as
Collateral under the Flood Disaster Protection Act of 1973, as amended. This requirement will be
waived upon presentation of evidence satisfactory to Administrative Agent that no portion of any
Property then serving as Collateral is located within an area identified by the U.S. Department of
Housing and Urban Development as having special flood hazards.



7.4 Additional Insurance. Borrower shall provide such other policies of insurance as
Administrative Agent may reasonably request in writing.



7.5 Other Requirements. All required insurance shall be procured and maintained in
financially sound and generally recognized responsible insurance companies selected by Borrower and
subject to the approval of Administrative Agent. Such companies should be authorized to write such
insurance in the State of California (in the case of the policies applicable to the UnitedHealth
Group Building Project), the State of Missouri (in the case of the policies applicable to the
Winghaven Project), the State of Texas (in the case of the polices applicable to the North Texas
Neurology Project and the Lonestar Endoscopy Project), the State of New Hampshire (in the case of
the polices applicable to the Nutfield Project), the State of Arizona (in the case of the polices
applicable to the Academy Medical Center Project) and the State of Indiana (in the case of the
polices applicable to the Epler B Project). The company issuing the policies shall have a
financial and performance rating of “A-IX” or better by A.M. Best Co., in Bests’ Key Guide, or
such other rating acceptable to Administrative Agent. All property policies evidencing the
required insurance shall name Administrative Agent (for the benefit of Lenders) as first mortgagee,
and all liability policies evidencing the insurance required shall name Administrative Agent (for
the benefit of Lenders) as additional insured, shall provide for payment to the Administrative
Agent (or its assignee, as directed by Administrative Agent), for the benefit of Lenders, of the
net proceeds of insurance resulting from any claim for loss or damage thereunder, shall not be
cancelable as to the interests of Administrative Agent and Lenders due to the acts of Borrower, and
shall provide for at least thirty (30) days prior written notice of the cancellation or
modification thereof to Administrative Agent.



7.6 Evidence. All policies of insurance, or certificates of insurance evidencing that such
insurance is in full force and effect, shall be delivered to Administrative Agent on or before the
Closing Date (together with proof of the payment of the premiums thereof). At least thirty (30)
days prior to the expiration or cancellation of each such policy, Borrower shall furnish
Administrative Agent evidence that such policy has been renewed or replaced in the form of a
certificate reflecting that there is in full force and effect, with a term covering the next
succeeding calendar year, insurance of the types and in the amounts required.



ARTICLE VIII




RIGHTS OF INSPECTION




Administrative Agent, or its agent, shall have the right at any time and from time to time to
enter upon the Properties then serving as Collateral for purposes of inspection and conducting
Appraisals.



ARTICLE IX




REPRESENTATIONS AND WARRANTIES




9.1 Consideration. As an inducement to Administrative Agent and Lenders to execute this
Agreement and to disburse the proceeds of the Loans, Borrower represents and warrants to
Administrative Agent and Lenders that the following statements set forth in this Article IX
are true, correct and complete as of the date hereof and will be true, correct and complete as of
the Closing Date and Borrower acknowledges that the truth and accuracy of such representations and
warranties is also a condition precedent to Administrative Agent’s and Lenders’ obligation to make
each Loan advance.



9.2 Organization, Powers and Good Standing.



(a) Organization and Powers-Borrower. Each Borrower is a limited liability company,
duly organized and validly existing under the laws of the Delaware, and is duly qualified to
transact business under the laws of the State of California, Missouri, Texas, New Hampshire,
Arizona or Indiana, as applicable. Each Borrower has all requisite power and authority and rights
to own and operate its properties, to carry on its businesses as now conducted and as proposed to
be conducted, and to enter into and perform this Agreement and the other Loan Documents. The
address of Borrower’s principal place of business is 1551 N. Tustin Avenue, Suite 300, Santa Ana,
California 92705.



(b) Organization and Powers-Guarantor. Guarantor is a corporation, duly organized and
validly existing under the laws of the State of Maryland. Guarantor has all requisite power and
authority and rights to own and operate its properties, to carry on its businesses as now conducted
and as proposed to be conducted, and to enter into and perform the Environmental Indemnity and the
other Loan Documents. The address of Guarantor’s principal place of business is 1551 N. Tustin
Avenue, Suite 300, Santa Ana, California 92705.



(c) Good Standing. Each Borrower has made all filings and is in good standing in the
State of Delaware and California, Missouri, Texas, New Hampshire, Arizona or Indiana, as
applicable, and in each other jurisdiction in which the character of the property it owns or the
nature of the business it transacts makes such filings necessary or where the failure to make such
filings could have a materially adverse effect on the business, operations, assets or condition
(financial or otherwise) of such Borrower. Guarantor has made all filings and is in good standing
in the State of Maryland and in each other jurisdiction in which the character of the property it
owns or the nature of the business it transacts makes such filings necessary or where the failure
to make such filings could have a materially adverse effect on the business, operations, assets or
condition (financial or otherwise) of Guarantor.



(d) Non-foreign Status. No Borrower is a “foreign corporation,” “foreign
partnership,” “foreign trust,” or “foreign estate,” as those terms are defined in the Internal
Revenue Code and the regulations promulgated thereunder. Each Borrower’s U.S. employer
identification number is as set forth on the signature page hereof.



9.3 Authorization of Loan Documents.



(a) Authorization. The execution, delivery and performance of the Loan Documents by
each Borrower are within such Borrower’s powers and have been duly authorized by all necessary
action by Borrower.



(b) No Conflict. The execution, delivery and performance of the Loan Documents by
each Borrower will not violate (i) any Borrower’s operating agreement or articles of organization;
or (ii) to Borrower’s knowledge, any legal requirement affecting any Borrower or any of its
properties; or (iii) any agreement to which any Borrower is bound or to which it is a party and
will not result in or require the creation (except as provided in or contemplated by this
Agreement) of any lien upon any of such properties.



(c) Binding Obligations. This Agreement and the other Loan Documents have been duly
executed by each Borrower, and are legally valid and binding obligations of each Borrower,
enforceable against each Borrower in accordance with their terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’
rights generally and by general principles of equity.



9.4 Compliance with Laws. Each Property consists of a legal and separate parcel or parcels
under applicable law and for tax assessment purposes. To Borrower’s best knowledge, the
Improvements were constructed in compliance with, and each Project presently complies fully with,
all restrictive covenants and all applicable laws and regulations, including, without limitation,
all building codes, environmental laws and the Americans With Disabilities Act (Public Law
101-336).



9.5 No Material Defaults. There exists no material violation of or material default by
Borrower and no event has occurred which, upon the giving of notice or the passage of time, or
both, would constitute a material default with respect to (a) the terms of any instrument
evidencing or securing any material indebtedness secured by any Project, (b) any material lease or
other agreement affecting any Project to which Borrower is a party, (c) to Borrower’s knowledge,
any material license, permit, statute, ordinance, law, judgment, order, writ, injunction, decree,
rule or regulation of any Governmental Authority, or any determination or award of any arbitrator
to which Borrower or any Project may be bound, or (d) any mortgage, instrument, agreement or
document by which Borrower, or any of its properties is bound: (i) which involves any Loan Document
        , (ii) that might materially and adversely affect the ability of Borrower to perform its
obligations under any of the Loan Documents, any Swap Contracts or any other material instrument,
agreement or document to which it is a party, or (iii) which might adversely affect the first
priority of the liens created by this Agreement or any of the Loan Documents.



9.6 Litigation; Adverse Facts. Borrower has no knowledge of any action, suit,
investigation, proceeding or arbitration (whether or not purportedly on behalf of Borrower) at law
or in equity or before or by any foreign or domestic court or other governmental entity (a “Legal
Action”), pending or, to the knowledge of Borrower, overtly threatened against or affecting any
Borrower or any of its assets which could reasonably be expected to result in any material adverse
change in the business, operations, assets (including the Projects) or condition (financial or
otherwise) of any Borrower or would materially and adversely affect Borrower’s ability to perform
its obligations under the Loan Documents. No Borrower is (a) in violation of any applicable law
which violation materially and adversely affects or may materially and adversely affect the
business, operations, assets (including the Projects) or condition (financial or otherwise) of
Borrower, (b) subject to, or in default with respect to any other legal requirement that would have
a materially adverse effect on the business, operations, assets (including the Projects) or
condition (financial or otherwise) of any Borrower, or (c) in default with respect to any agreement
to which any Borrower is a party or to which it is bound. There is no Legal Action pending or, to
the knowledge of any Borrower, threatened against or affecting any Borrower questioning the
validity or the enforceability of this Agreement or any of the other Loan Documents.



9.7 Title to Properties; Liens. Each Borrower has good and legal title to all properties
and assets reflected in its most recent balance sheet delivered to Administrative Agent, except for
assets disposed of in the ordinary course of business since the date of such balance sheet.
Borrower is the sole owner of, and has good and marketable title to the fee interest in the
Properties serving as Collateral, and the Improvements and all other real property described in the
Deeds of Trust, free from any adverse lien, security interest or encumbrance of any kind
whatsoever, excepting only (a) liens and encumbrances shown on the Title Policies, (b) liens and
security interests in favor of Administrative Agent, and (c) other matters which have been approved
in writing by Administrative Agent.



9.8 Disclosure. There is no fact known to Borrower that materially and adversely affects
the business, operations, assets or condition (financial or otherwise) of any Borrower that has not
been disclosed in this Agreement or in other documents, certificates and written statements
furnished to Administrative Agent in connection herewith.



9.9 Payment of Taxes. All tax returns and reports of each Borrower required to be filed by
it have been timely filed, and all taxes, assessments, fees and other governmental charges upon
each Borrower and upon its properties, assets, income and franchises which would otherwise be
delinquent have been paid prior to such delinquency.



9.10 Securities Activities. No Borrower is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or carrying any
margin stock (as defined within Regulations G, T and U of the Board of Governors of the Federal
Reserve System), and none of the value of any Borrower’s assets consists of such margin stock. No
part of the Loans will be used to purchase or carry any margin stock or to extend credit to others
for that purpose or for any other purpose that violates the provisions of Regulations U or X of
said Board of Governors.



9.11 Government Regulations. No Borrower is subject to regulation under the Investment
Company Act of 1940, the Federal Power Act, the Public Utility Holding Company Act of 1935, the
Interstate Commerce Act or to any federal or state statute or regulation limiting its ability in
incur indebtedness for money borrowed.



9.12 Rights to Project Agreements, Permits and Licenses. Upon the purchase of each
Property, Borrower will be the true owner of all rights in and to all existing agreements, permits
and licenses relating to such Projects, and will be the true owner of all rights in and to all
future agreements, permits and licenses relating to such Project.



9.13 Access. All streets and easements necessary for the operation of the Projects are
available to the boundaries of the Properties.



9.14 Use of Projects. To Borrower’s knowledge, the Improvements and the Properties, and
their use as medical/commercial office buildings, comply fully with all applicable laws and
restrictive covenants, including, without limitation, all zoning laws.



9.15 Financial Condition. The financial statements and all financial data previously
delivered to Administrative Agent in connection with the Loans and/or relating to each Borrower are
true, correct and complete in all material respects. Such financial statements and fairly present
the financial position of the parties who are the subject thereof as of the date thereof. No
material adverse change has occurred in such financial position, no material borrowings have been
made by any Borrower since the date thereof which are secured by, or might give rise to, a lien or
claim against any Project, the proceeds of the Loans, or other assets of Borrower.



9.16 Personal Property. Borrower is now and shall continue to be the sole owner of the
personal property constituting part of the Collateral free from any adverse lien, security interest
or adverse claim of any kind whatsoever, except for liens or security interests in favor of
Administrative Agent.



9.17 No Condemnation. No condemnation proceedings or moratorium is pending or, to
Borrower’s knowledge, threatened against any Project or any Property (or any portion thereof) which
would materially impair the use, occupancy or full operation of any Project in any manner
whatsoever.



9.18 Other Loan Documents. Each of the representations and warranties of Borrower
contained in any of the other Loan Documents is true and correct in all material respects. All of
such representations and warranties are incorporated herein for the benefit of Administrative
Agent.



9.19 Guarantor. Guarantor has full right, power and authority to execute, deliver and
carry out the terms of the Guaranty and the Environmental Indemnities and, when executed and
delivered pursuant thereto, the Guaranty and the Environmental Indemnities will constitute the
valid, binding and legal obligations of Guarantor, enforceable against Guarantor in accordance with
its terms subject to bankruptcy, insolvency, moratorium and similar laws affecting creditors
generally and to general principles of equity.



9.20 No Lease Defaults. There are no defaults by Borrower or, to Borrower’s knowledge, any
tenant under any Lease.



9.21 Defects. To Borrower’s knowledge, there are no defects, facts or conditions affecting
any Project which would make it unsuitable for its present use and operation as a
medical/commercial office buildings.



9.22 ERISA. As of the Closing Date and throughout the term of the Loan, (a) Borrower is
not and will not be an “employee benefit plan” as defined in ERISA, and (b) the assets of Borrower
do not and will not constitute “plan assets” of one or more such plans for purposes of Title I of
ERISA.



9.23 Project Information. The information in Schedule 1.1(B) hereof with respect
to each Project is correct.



ARTICLE X




COVENANTS OF BORROWER




10.1 Consideration. As an inducement to Administrative Agent and the Lenders to execute
this Agreement and to make each disbursement of the Loans, Borrower hereby covenants as set forth
in this Article X, which covenants shall remain in effect so long as the Notes shall remain
unpaid or any obligation of Borrower under any other Loan Documents or under any Swap Contracts
remain outstanding or unperformed.



10.2 Existence. Each Borrower shall and shall cause Guarantor (if other than an
individual) to continue to be validly existing under the laws of the jurisdiction of its
organization.



10.3 Books and Records; Access by Administrative Agent and the Lenders. Borrower shall
maintain a single, standard, modern system of accounting (including, without limitation, a single,
complete and accurate set of books and records of its assets, business, financial condition,
operations, property, prospects and results of operation in accordance with good accounting
practice and on a GAAP basis). During business hours and upon reasonable advance written notice,
Borrower will give representatives of Administrative Agent and each Lender access to all assets,
books, documents, property, and records of Borrower and will permit such representatives to inspect
such assets and property and to audit, copy, examine and make excerpts from such books, documents
and records.



10.4 No Encumbrances. Borrower will not permit any lien, levy, attachment or restraint to
be made or filed against any Project then serving as Collateral, or any portion thereof, or permit
any receiver, trustee or assignee for the benefit of creditors to be appointed to take possession
of any Project then serving as Collateral or any portion thereof, except for lien claims filed or
asserted against a Property or a Project and concerning which Borrower is in full compliance with
the applicable provisions of the applicable Deed of Trust.



10.5 Compliance with Laws. Borrower shall comply with all applicable laws, statutes,
regulations, codes and requirements, as amended from time to time (including, without limitation,
all environmental laws, building, zoning and use and condominium and common interest development
laws, requirements, regulations and ordinances, and the Americans With Disabilities Act), all CC&Rs
and all obligations created by private contracts and leases which affect ownership, development,
construction, equipping, fixturing, use or operation of any Project then serving as Collateral. If
requested by Administrative Agent, Borrower shall deliver to Administrative Agent, promptly after
receipt thereof, copies of all permits and approvals received from Governmental Authorities
relating to the development, construction, use, occupancy or operation of the Projects then serving
as Collateral to the extent such items are in Borrower’s possession or are reasonably obtainable by
Borrower.



10.6 Personal Property. Borrower will not install materials, personal property, equipment
or fixtures subject to any security agreement or other agreement or contract wherein the right is
reserved to any person, firm or corporation to remove or repossess any such materials, equipment
for fixtures, or whereby title to any of the same is not completely vested in Borrower at the time
of installation, other than medical equipment purchased with purchase money financing, without
Administrative Agent’s prior written consent.



10.7 Assessments. Borrower shall pay or discharge all lawful claims, including taxes,
assessments and governmental charges or levies imposed upon Borrower or its income or profits or
upon any property (including the Projects) belonging to Borrower (all the above collectively
hereinafter referred to as “Impositions”), prior to the date upon which penalties attach thereto,
and submit evidence satisfactory to Administrative Agent confirming the payment of all Impositions
against the Projects then serving as Collateral. Borrower has the right before any delinquency
occurs to contest or object to the amount or validity of any such Imposition by appropriate
proceedings, but this will not be deemed or construed in any way as relieving, modifying or
extending Borrower’s covenant to pay any such Imposition at the time and in the manner provided in
this Section 10.7, unless Borrower has given prior written notice to Administrative Agent
of Borrower’s intent to so contest or object to an Imposition, and unless, at Administrative
Agent’s sole option, (i) Borrower demonstrates to Administrative Agent’s reasonable satisfaction
that the proceedings to be initiated by Borrower will conclusively operate to prevent the sale of
the Collateral, or any part thereof, to satisfy such Imposition prior to final determination of
such proceedings; or (ii) Borrower furnishes a good and sufficient bond or surety as requested by
and reasonably satisfactory to Administrative Agent; or (iii) Borrower demonstrates to
Administrative Agent’s reasonable satisfaction that Borrower has provided as good and sufficient
undertaking as may be required or permitted by law to accomplish a stay of any such sale.



10.8 Disbursements. Borrower shall receive the disbursements to be made hereunder as a
trust fund for the purpose of paying the costs and expenses of refinancing the Projects serving as
Collateral as approved hereunder by Administrative Agent as provided herein, and for no other
purpose.



10.9 Information and Statements. Borrower shall furnish to Administrative Agent, with
sufficient copies for each Lender which Administrative Agent shall distribute to the Lenders:



(a) as soon as the same are available, and in any event within one hundred twenty (120) days
after the end of each fiscal year of each Borrower, certified by an officer of Borrower, a copy of
the current company-prepared financial statements of each Borrower, prepared upon a GAAP accrual
basis, which shall consist of (1) a balance sheet as of the end of the relevant fiscal year,
(2) statements of income and expenses of each Borrower for such fiscal year (together, in each
case, with the comparable figures for the previous fiscal year), (3) statements of income and
expenses and changes in financial position of each Project then serving as Collateral for such
fiscal year (together, in each case with comparable figures for the corresponding fiscal year), and
(4) cash flow statements of each Borrower;



(b) copies of filed federal income tax returns of each Borrower and Guarantor for each taxable
year (with all K-1s and other forms and supporting schedules attached), on or before October 30 of
each year;



(c) a copy of the filed Form 10-K of Guarantor for each fiscal year, within one hundred twenty
(120) days after Guarantor’s fiscal year end;



(d) Intentionally Omitted.



(e) as soon as the same are available, and in any event within sixty (60) days after the end
of each fiscal quarter, deliver to Administrative Agent a detailed rent roll, in form and detail
reasonably satisfactory to Administrative Agent, for each Project then serving as Collateral for
the preceding fiscal quarter; and



(f) such other information concerning each Borrower, Guarantor, the Projects then serving as
Collateral, and the assets, business, financial condition, operations, property, prospects, and
results of operations of each Borrower and Guarantor as Administrative Agent reasonably requests
from time to time.



10.10 Representations and Warranties. Until repayment of the Notes and all other
obligations secured by the Deeds of Trust, the representations and warranties of Article IX
shall remain true and complete in all material respects.



10.11 Trade Names. Borrower shall immediately notify Administrative Agent in writing of
any change in the legal, trade or fictitious business names used by any Borrower and shall, upon
Administrative Agent’s request, execute any additional financing statements and other certificates
necessary to reflect the change in trade names or fictitious business names.



10.12 Further Assurances. Borrower shall execute and deliver from time to time, promptly
after any request therefor by Administrative Agent, any and all instruments, agreements and
documents and shall take such other action as may be necessary or desirable in the opinion of
Administrative Agent to maintain, perfect or insure Administrative Agent’s security provided for
herein and in the other Loan Documents, including, without limitation, the authorization of UCC-1
renewal statements, the execution of such amendments to the Deeds of Trust and the other Loan
Documents and the delivery of such endorsements to the Title Company, all as Administrative Agent
shall reasonably require, and Borrower shall pay all fees and expenses (including reasonable
attorneys’ fees) related thereto. Promptly upon the request of Administrative Agent, Borrower
shall execute and deliver a Certification of Non-Foreign Status.



10.13 Notice of Litigation. Borrower shall give, or cause to be given, prompt written
notice to Administrative Agent of (a) any action or proceeding which is instituted by or against
any Borrower or Guarantor in any Federal or state court or before any commission or other
regulatory body, Federal, state or local, foreign or domestic, or any such proceedings which are
threatened in writing against it, which, if adversely determined, would be likely to have a
material and adverse effect upon any Borrower’s or Guarantor’s (as applicable) business,
operations, properties, assets, management, ownership or condition (financial or otherwise),
(b) any other action, event or condition of any nature which may have a material and adverse effect
upon any Borrower’s or Guarantor’s (as applicable) business, operations, management, assets,
properties, ownership or condition (financial or otherwise), or which, with notice or lapse of time
or both, would constitute an Event of Default or a default under any other contract, instrument or
agreement to which any Borrower or Guarantor is a party to by or to which any Borrower or Guarantor
or any of their properties or assets may be bound or subject, and (c) any actions, proceedings or
notices adversely affecting any Project then serving as Collateral or Administrative Agent’s
interest therein by any zoning, building or other municipal officers, offices or departments having
jurisdiction with respect to such Project.



10.14 Good Standing. Each Borrower shall maintain its good standing in Delaware and
California, Missouri, Texas, New Hampshire, Arizona or Indiana, as applicable, and preserve all of
its rights and franchises material to its business and shall cause Guarantor (if other than an
individual) to maintain and preserve its existence.



10.15 Hazardous Materials. Borrower will not use, and will not permit the use of, any
Hazardous Substance (as defined in the Environmental Indemnities) in connection with the Projects
then serving as Collateral except as permitted by applicable law and the Environmental Indemnity.



10.16 Intentionally Omitted.



10.17 Intentionally Omitted.



10.18 Government Regulation. No Borrower shall (a) be or become subject at any time to any
law, regulation, or list of any government agency (including, without limitation, the U.S. Office
of Foreign Asset Control list) that prohibits or limits Administrative Agent from making any
advance or extension of credit to any Borrower or from otherwise conducting business with any
Borrower, or (b) fail to provide documentary and other evidence of any Borrower’s identity as and
when requested by Administrative Agent at any time to enable Administrative Agent to verify such
Borrower’s identity or to comply with any applicable law or regulation, including, without
limitation, Section 326 of the USA Patriot Act of 2001, 31 U.S.C. Section 5318.



10.19 Negative Covenants. Borrower shall not, without the prior written consent of
Administrative Agent in Administrative Agent’s sole and absolute discretion, do or permit to be
done any of the following:



(a) Indebtedness. No Borrower shall incur or become liable for any Indebtedness,
whether secured or unsecured, in favor of any Person, other than:



(i) the Loans and all other obligations under the Loan Documents;



(ii) trade debt incurred in the ordinary course of Borrower’s business and paid in the
ordinary course of Borrower’s business and in any event in not more than sixty (60) days; and



(iii) obligations under Swap Contracts permitted under Section 13.30 hereof.



(b) Liens and Encumbrances. No Borrower shall create, incur or suffer to exist any
lien or encumbrance in, of or on any of the property of such Borrower except for Permitted
Exceptions, liens for equipment financing not to exceed $500,000 or liens for trade payables in the
ordinary course of business, provided in each case that no such liens shall be recorded or filed
against any Project.



(c) Fundamental Changes. No Borrower shall, and Borrower shall not permit Guarantor
to, dissolve or liquidate or become a party to any merger or consolidation.



(d) Distributions. No Borrower shall declare or pay any distributions or redeem,
repurchase or otherwise acquire or retire any of its capital stock or other ownership interest at
any time outstanding, except that, for so long as no Event of Default or Unmatured Event of Default
has occurred and is continuing, each Borrower may make distributions to its members so long as
after giving effect to any such distribution no Event of Default or Unmatured Event of Default
shall have occurred.



(e) Affiliates. No Borrower shall enter into any transaction (including the purchase
or sale of any property or service) with, or make any payment or transfer to, any Affiliate of any
Borrower except in the ordinary course of business and pursuant to the reasonable requirements of
such Borrower’s business and upon fair and reasonable terms no less favorable to Borrower than
Borrower would obtain in a comparable arms-length transaction.



(f) Amendments to Organizational Documents. No Borrower shall allow any material
amendments to be made in the terms of such Borrower’s or Guarantor’s organizational documents which
would adversely effect in any material respect any Borrower, Guarantor, any Project then serving as
Collateral, any Borrower’s or Guarantor’s ability to perform their obligations under the Loan
Documents or Administrative Agent’s security interests..



(g) No Other Business. No Borrower shall engage in any business other than the
ownership, management, and operation of the Projects then serving as Collateral and Borrower will
conduct and operate its business as presently conducted and operated.



(h) No Commingling. Subject to its right to distribute funds pursuant to
Section 10.19(d), Borrower will not commingle its funds and other assets with those of any
Affiliate, Guarantor, any of Borrower’s members, managers, partners or shareholders or any other
Person.



(i) Changes. Borrower will not change or in any manner cause or seek a change in any
laws, requirements of Governmental Authorities or obligations created by private contracts and
leases which now or hereafter may significantly adversely affect the ownership, use or operation of
any Project then serving as Collateral, without the prior written consent of Administrative Agent.



(j) Change in Ownership. No Borrower shall suffer to occur or exist, whether
occurring voluntarily or involuntarily, any change in, or any lien or encumbrance with respect to,
the legal or beneficial ownership of any interest in such Borrower, any member in such Borrower or
any other direct or indirect ownership interest in such Borrower or the members in such Borrower
(except for shares of stock in Grub & Ellis Healthcare REIT, Inc. which may be transferred without
violating the provisions of this clause (j)).



(k) Leases. No Borrower shall enter into, amend or modify any lease in excess of
10,000 square feet (each such lease, a “Material Lease”) covering any portion of any Project then
serving as Collateral without Administrative Agent’s prior written consent, in Administrative
Agent’s sole discretion; provided, however, no Borrower shall enter any lease which is not a
Material Lease for which the rent payable under such lease is not a market rent or the terms are
not otherwise market without Administrative Agent’s prior written consent, in Administrative
Agent’s sole discretion. The applicable Borrower shall furnish to Administrative Agent, upon
execution, a fully executed copy of each lease entered into by such Borrower, together with all
exhibits and attachments thereto and all amendments and modifications thereof. The applicable
Borrower shall provide Administrative Agent with a copy of each proposed Material Lease and with
financial information on the proposed tenant to aid Administrative Agent in determining whether it
will consent thereto. Administrative Agent may declare each such Material Lease (or any other
lease) to be prior or subordinate to the applicable Deed of Trust, at Administrative Agent’s sole
option.



10.20 Post-Closing Deliveries. Borrower shall, within fifteen (15) days after the
Closing Date, deliver to Administrative Agent fully-executed and acknowledged subordination,
nondisturbance and attornment agreements, in form and content satisfactory to Administrative Agent,
for leases covering not less than eighty-five percent (85%) of the Epler B Project.



ARTICLE XI




EVENTS OF DEFAULT AND REMEDIES




11.1 Events of Default. The occurrence of any one or more of the following shall
constitute an Event of Default under this Agreement:



(a) Failure of Borrower or Guarantor to pay any amounts due pursuant to this Agreement, the
Notes or the other Loan Documents (including, without limitation, principal, interest, fees, or
other amounts) within ten (10) days after the date such amount is due.



(b) Failure by Borrower or Guarantor to pay any amount (other than principal or interest) when
due under this Agreement or any other Loan Document and the expiration of ten (10) days after
written notice of such failure by Administrative Agent to Borrower.



(c) Failure by Borrower, Guarantor or any other Person referred to therein to comply with any
of the provisions of Article VII or Sections 10.4, 10.18, or
10.19(b), (c), (d), and (j).



(d) Failure by Borrower or Guarantor to perform any other obligation, or to comply with any
term or condition, applicable to Borrower or Guarantor under any Loan Document that is not referred
to in another Section of this Section 11.1 and the expiration of thirty (30) days after
written notice of such failure by Administrative Agent to Borrower; provided, however, that if such
default is susceptible of cure but such cure cannot be accomplished with reasonable diligence
within said period of time, and if Borrower commences to cure such default promptly after receipt
of notice thereof from Administrative Agent, and thereafter prosecutes the curing of such default
with reasonable diligence, such period of time shall be extended for such period of time as may be
necessary to cure such default with reasonable diligence, but not to exceed an additional
sixty (60) days.



(e) Any representation or warranty by any Borrower or Guarantor in any Loan Document is
materially false, incorrect, or misleading as of the date made or renewed.



(f) The occurrence of any event (including, without limitation, a change in the financial
condition, business, or operations of Borrower or Guarantor for any reason whatsoever) that
materially and adversely affects the ability of Borrower or Guarantor to perform any of its
obligations under the Loan Documents or under any Swap Contracts.



(g) Any Borrower or Guarantor (i) is unable or admits in writing such Borrower’s or
Guarantor’s inability to pay its monetary obligations as they become due, (ii) fails to pay when
due any monetary obligation, whether such obligation be direct or contingent, to any person in
excess of $250,000, (iii) makes a general assignment for the benefit of creditors, or (iv) applies
for, consents to, or acquiesces in, the appointment of a trustee, receiver, or other custodian for
any Borrower or Guarantor or the property of any Borrower or Guarantor or any part thereof, or in
the absence of such application, consent, or acquiescence a trustee, receiver, or other custodian
is appointed for any Borrower or Guarantor or the property of any Borrower or Guarantor or any part
thereof, and such appointment is not discharged within sixty (60) days.



(h) Commencement of any case under the Bankruptcy Code, Title 11 of the United State Code, or
commencement of any other bankruptcy arrangement, reorganization, receivership, custodianship, or
similar proceeding under any federal, state, or foreign law by any Borrower or Guarantor.



(i) If a receiver, trustee or similar officer shall be appointed for any Borrower or Guarantor
or for all or any substantial part of the property of any Borrower or Guarantor without the
application or consent of such Borrower or Guarantor and such appointment shall continue
undischarged for a period of sixty (60) days (whether or not consecutive); or any bankruptcy,
insolvency, reorganization, arrangements, readjustment of debt, dissolution, liquidation or similar
proceedings shall be instituted (by petition, application, or otherwise) against any Borrower or
Guarantor and shall remain undismissed for a period of sixty (60) days (whether or not
consecutive).



(j) Any material litigation or proceeding is commenced before any Governmental Authority
against or affecting any Borrower or the property of any Borrower or any part thereof and such
litigation or proceeding is not defended diligently and in good faith by such Borrower. Any
litigation or proceeding is commenced before any Governmental Authority against or affecting
Guarantor which if decided against Guarantor would materially adversely affect any Project then
serving as Collateral or Guarantor’s ability to perform its obligations under the Guaranty, and
such litigation or proceeding is not defended diligently and in good faith by Guarantor.



(k) A final judgment or decree for monetary damages or a monetary fine or penalty (not subject
to appeal or as to which the time for appeal has expired) is entered against any Borrower or
Guarantor by any Government Authority, which together with the aggregate amount of all other such
judgments and decrees against any Borrower or Guarantor that remain unpaid or that have not been
discharged or stayed, exceeds $250,000.00, is not paid and discharged or stayed within thirty (30)
days after the entry thereof.



(l) Commencement of any action or proceeding which seeks as one of its remedies the
dissolution of any Borrower.



(m) All or any part of the property of any Borrower, or all or any part of the property of
Guarantor valued in excess of $500,000 in the aggregate, is attached, levied upon, or otherwise
seized by legal process, and such attachment, levy, or seizure is not quashed, stayed, or released
within thirty (30) days of the date thereof.



(n) The occurrence of any Accelerating Transfer (as defined in the Deeds of Trust), unless
Administrative Agent has consented to such Accelerating Transfer in its sole and absolute
discretion, as more particularly provided in the Deeds of Trust.



(o) The occurrence of any Event of Default, as such term is defined in any other Loan
Document, after taking into account applicable cure periods.



(p) (i) A default shall occur in the payment when due (after giving effect to any applicable
notice and grace periods), whether by acceleration or otherwise, with respect to indebtedness of
any Borrower or Guarantor in an aggregate amount exceeding $50,000.00; or (ii) a default shall
occur in the performance or observance of any obligation or condition with respect to indebtedness
in an aggregate amount exceeding $50,000.00 if the effect of such default described in this clause
(ii) is to permit the acceleration of the maturity of such indebtedness.



(q) Any Borrower, Guarantor or any Person on behalf of any Borrower or Guarantor shall claim
or assert that the Loan Documents are not legal, valid and binding agreements enforceable against
any Borrower or Guarantor in accordance with their respective terms; or the Loan Documents shall in
any way be terminated (except in accordance with their terms) or become or be judicially declared
ineffective or inoperative or shall in any way cease to give or provide the respective liens,
security interests, rights, titles, interests, remedies, powers or privileges intended to be
created thereby.



(r) Any Governmental Authorities take or institute action, which in the reasonable opinion of
Administrative Agent, will adversely affect any Borrower’s or Guarantor’s ability to repay the
Loans or which will materially affect any Borrower’s or Guarantor’s condition or operations, if
such action remains effective for more than thirty (30) days.



(s) Administrative Agent fails to have a legal, valid, binding, and enforceable first priority
lien acceptable to Administrative Agent (subject to Permitted Exceptions) on each Property then
serving as Collateral, Improvements and all other collateral.



(t) Failure of Guarantor to perform or comply with any financial covenant or agreement
contained in the Guaranty or Environmental Indemnities which remains uncured for thirty (30) days
after written notice of such failure by Administrative Agent to Guarantor.



(u) Borrower has not satisfied all of the condition set forth in Section 4.10(a) and
Section 4.11(a) on or before July 31, 2008 (unless such conditions have been waived in
writing by Administrative Agent); provided, however, the foregoing shall not be an Event of Default
if, as of July 31, 2008, (i) the Debt Service Coverage Ratio (for the Projects then serving as
Collateral) equals or exceeds 1.25:1.00 as determined by Administrative Agent in its sole and
absolute discretion, and (ii) the Loan-to-Value Ratio (for the Projects then serving as Collateral)
shall not exceed sixty-six percent (66%) as determined by Administrative Agent in its sole and
absolute discretion; provided further that if Borrower fails to satisfy the foregoing Debt Service
Coverage Ratio and/or Loan-to-Value Ratio condition(s), Borrower may satisfy such condition(s) by
paying down the outstanding Loan balance to an amount that would result in such condition(s) being
satisfied within five (5) Business Days after Administrative Agent’s demand therefor.



11.2 Remedies.



(a) Notwithstanding any provision to the contrary herein or any of the other Loan Documents,
upon the happening of any Event of Default under this Agreement, or upon an Event of Default under
any of the other Loan Documents: (i) Administrative Agent’s and Lenders’ obligation to make further
advances of the Loan shall be suspended, and (ii) if the Event of Default shall not be cured within
the applicable notice and cure periods, then Administrative Agent shall, at its option, have the
remedies provided in the Loan Document breached by Borrower, including, without limitation, the
option to declare all outstanding indebtedness to be immediately due and payable without
presentment, demand, protest or notice of any kind, and the following remedies: Administrative
Agent’s and Lenders’ obligation to make further disbursements to Borrower shall terminate;
Administrative Agent may, at its option, apply any of Borrower’s funds in its possession to the
outstanding indebtedness under the Notes whether or not such indebtedness is then due; and
Administrative Agent and Lenders may exercise all rights and remedies available to them under any
or all of the Loan Documents and applicable law. All sums expended by Administrative Agent and
Lenders for such purposes shall be deemed to have been disbursed to and borrowed by Borrower and
should be secured by the Deeds of Trust on the Properties then serving as Collateral.



(b) Effective from and after the occurrence of and during the continuance of an Event of
Default, Borrower hereby constitutes and appoints Administrative Agent, or an independent
contractor selected by Administrative Agent, as its true and lawful attorney-in-fact with full
power of substitution for the performance of Borrower’s obligations under this Agreement in the
name of Borrower, and hereby empower said attorney-in-fact to do any or all of the following upon
the occurrence of an Event of Default:



(i) to employ attorneys to defend against attempts to interfere with the exercise of power
granted hereby;



(ii) to pay, settle or compromise all existing bills and claims which are or may be liens
against the Properties then serving as Collateral, the Improvements or the Projects then serving as
Collateral;



(iii) to execute all applications and certificates in the name of Borrower, which may be
required by any other contract;



(iv) to prosecute and defend all actions or proceedings in connection with the Projects then
serving as Collateral and to take such action, require such performance and do any and every other
act as is deemed necessary with respect to the operation of the Projects then serving as Collateral
which Borrower might do on its own behalf;



(v) to let new or additional contracts to the extent not prohibited by their existing
contracts; and



(vi) to take such action and require such performance as it deems necessary under any of the
bonds or insurance policies to be furnished hereunder, to make settlements and compromises with the
sureties or insurers thereunder, and in connection therewith to execute instruments of release and
satisfaction.



It is understood and agreed that the foregoing power of attorney shall be deemed to be a power
coupled with an interest which cannot be revoked until repayment of the Loan and performance of all
other obligations under the Loan Documents or any Swap Contracts entered into pursuant to
Section 13.30 hereof..



ARTICLE XII




ADMINISTRATIVE AGENT




12.1 Appointment and Authority. Each of the Lenders hereby irrevocably appoints Wachovia
Bank to act on its behalf as Administrative Agent hereunder and under the other Loan Documents,
including without limitation acting as collateral agent for the Lenders under the Loan Documents,
or any of them, and authorizes Administrative Agent to take such actions on its behalf and to
exercise such powers as are delegated to Administrative Agent by the terms hereof or thereof,
together with such actions and powers as are reasonably incidental thereto. The provisions of this
Article are solely for the benefit of Administrative Agent and the Lenders, and neither Borrower
nor Guarantor shall have rights as a third party beneficiary of any of such provisions.



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



12.3 Exculpatory Provisions.



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



(b) Administrative Agent shall not be liable for any action taken or not taken by it (i) with
the consent or at the request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Section 13.1 and ARTICLE XI or
(ii) in the absence of its own gross negligence or willful misconduct. Administrative Agent shall
be deemed not to have knowledge of any Event of Default unless and until notice describing such
Event of Default is given to Administrative Agent by Borrower or a Lender.



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



12.4 Reliance by Administrative Agent. Administrative Agent shall be entitled to rely
upon, and shall not incur any liability for relying upon, any notice, request, certificate,
consent, statement, instrument, document or other writing (including any electronic message,
Internet or intranet website posting or other distribution) believed by it to be genuine and to
have been signed, sent or otherwise authenticated by the proper Person. Administrative Agent also
may rely upon any statement made to it orally or by telephone and believed by it to have been made
by the proper Person, and shall not incur any liability for relying thereon. In determining
compliance with any condition hereunder to the making of a Loan, that by its terms must be
fulfilled to the satisfaction of a Lender, Administrative Agent may presume that such condition is
satisfactory to such Lender unless Administrative Agent shall have received notice to the contrary
from such Lender prior to the making of such Loan. Administrative Agent may consult with legal
counsel (who may be counsel for Borrower), independent accountants and other experts selected by
it, and shall not be liable for any action taken or not taken by it in accordance with the advice
of any such counsel, accountants or experts.



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



12.6 Resignation of Administrative Agent. Administrative Agent may at any time give notice
of its resignation to the Lenders and Borrower. Upon receipt of any such notice of resignation,
the Required Lenders shall have the right, with the consent of Borrower unless an Event of Default
has occurred and is continuing (such consent not to be unreasonably withheld or delayed), to
appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of
any such bank with an office in the United States. If no such successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment within thirty (30) days
after the retiring Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent
meeting the qualifications set forth above provided that if Administrative Agent shall notify
Borrower and the Lenders that no qualifying Person has accepted such appointment, then such
resignation shall nonetheless become effective in accordance with such notice and (1) the retiring
Administrative Agent shall be discharged from its duties and obligations hereunder and under the
other Loan Documents and (2) all payments, communications and determinations provided to be made
by, to or through Administrative Agent shall instead be made by or to each Lender directly, until
such time as the Required Lenders appoint a successor Administrative Agent as provided for above in
this Section. Upon the acceptance of a successor’s appointment as Administrative Agent hereunder,
such successor shall succeed to and become vested with all of the rights, powers, privileges and
duties of the retiring (or retired) Administrative Agent, and the retiring Administrative Agent
shall be discharged from all of its duties and obligations hereunder or under the other Loan
Documents (if not already discharged therefrom as provided above in this paragraph). The fees
payable by Borrower to a successor Administrative Agent shall be the same as those payable to its
predecessor unless otherwise agreed between Borrower and such successor. The predecessor
Administrative Agent shall pay to the successor the pro rata portion of any annual administration
fee paid in advance by Borrower for the portion of the year between the time of the successor
Administrative Agent’s acceptance of its appointment as Administrative Agent and the following
anniversary date of this Agreement. After the retiring Administrative Agent’s resignation
hereunder and under the other Loan Documents, the provisions of this Article and
Section 13.10 shall continue in effect for the benefit of such retiring Administrative
Agent, its sub agents and their respective Related Parties in respect of any actions taken or
omitted to be taken by any of them while the retiring Administrative Agent was acting as
Administrative Agent.



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



12.8 No Other Duties, Etc. Anything herein to the contrary notwithstanding, none of the
Arrangers or Bookrunners listed on the cover page hereof shall have any powers, duties or
responsibilities under this Agreement or any of the other Loan Documents, except in its capacity,
as applicable, as Administrative Agent or a Lender hereunder.



ARTICLE XIII




MISCELLANEOUS




13.1 Successors and Assigns Generally; Assignments.



(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 Borrower
may not assign or otherwise transfer any of its rights or obligations hereunder without the prior
written consent of Administrative Agent and each Lender and no Lender may assign or otherwise
transfer any of its rights or obligations hereunder except (i) to an 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 Administrative Agent and the Lenders)
any legal or equitable right, remedy or claim under or by reason of this Agreement.



(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 any such assignment shall be subject to
the following conditions: (i) 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, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned;
(ii) in any case not described in clause (i) of this paragraph, 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 Loans 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 Administrative Agent or, if an “Effective Date” is
specified in the Assignment and Assumption, as of the Effective Date) shall not be less than
$5,000,000 (and integral multiples of $1,000,000 in excess thereof), unless each of Administrative
Agent and, so long as no Default has occurred and is continuing, Borrower otherwise consent (each
such consent not to be unreasonably withheld or delayed); (iii) each partial assignment shall be
made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations
under this Agreement with respect to the Loans or the Commitment assigned; (iv) no consent shall be
required for any assignment except to the extent required by clause (ii) of this paragraph
and, in addition: (A) the consent of Borrower (such consent not to be unreasonably withheld or
delayed) shall be required unless (x) an Event of Default or an Unmatured Event of Default has
occurred and is continuing at the time of such assignment or (y) such assignment is to a Lender, an
Affiliate of a Lender or an Approved Fund and (B) the consent of Administrative Agent (such consent
not to be unreasonably withheld or delayed) shall be required if such assignment is to a Person
that is not a Lender with a Commitment, an Affiliate of such Lender or an Approved Fund with
respect to such Lender; (v) the parties to each assignment shall execute and deliver to
Administrative Agent an Assignment and Assumption, together with a processing and recordation fee
of $3,500 for each assignment, and the assignee, if it is not a Lender, shall deliver to
Administrative Agent an Administrative Questionnaire; (vi) no such assignment shall be made to
Borrower or any of Borrower’s Affiliates or Subsidiaries; (vii) no such assignment shall be made to
a natural person; and (viii) the assigning Lender must retain a Commitment of at least $10,000,000
(and integral multiples of $1,000,000 in excess thereof).



Subject to acceptance and recording thereof by Administrative Agent pursuant to
paragraph (c) of this Section, from and after the effective date specified in each
Assignment and Assumption, the 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 2.8, 2.11
and 13.10 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) Administrative Agent, acting solely for this purpose as an agent of Borrower, shall
maintain at its office in Charlotte, North Carolina, 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
Borrower, Administrative Agent and the Lenders may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for inspection by 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, Borrower or
Administrative Agent, sell participations to any Person (other than a natural person or Borrower or
any of Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion of such
Lender’s rights and/or obligations under this Agreement (including all or a portion of its
Commitment and/or the Loans owing to it); provided that (i) such Lender’s obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (iii) Borrower, Administrative
Agent, and the 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 Participant, agree to any amendment, modification
or waiver described in Section 13.27 that requires the consent of all Lenders, 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 2.8 and 2.11 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 13.28(a) as though it were a Lender, provided such
Participant agrees to be subject to Section 13.28(b) as though it were a Lender.



(e) A Participant shall not be entitled to receive any greater payment under
Sections 2.8 or 2.11 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 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 2.11
unless Borrower is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of Borrower, to comply with Section 2.11 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 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.



13.2 Notices. All demands or notices required or which any party desires to give hereunder
or under any other Loan Document shall be in writing (including, without limitation, telecopy,
telegraphic, telex, or cable communication) and, unless otherwise specifically provided in such
other Loan Document, shall be deemed sufficiently given or furnished if delivered by personal
delivery, by nationally recognized overnight courier service or by certified United States mail,
postage prepaid, addressed to the party to whom directed at the applicable address specified at the
end of this paragraph (unless changed by similar notice in writing given by the particular party
whose address is to be changed) or by facsimile. Any demand or notice shall be deemed to have been
given either at the time of personal delivery or, in the case of courier or mail, as of the date of
first attempted delivery at the address and in the manner provided herein, or, in the case of
facsimile, upon receipt; provided that service of a demand or notice required by any applicable
statute shall be considered complete when the requirements of that statute are met.
Notwithstanding the foregoing, no notice of change of address shall be effective except upon actual
receipt. This Section shall not be construed in any way to affect or impair any waiver of notice
or demand provided in this Agreement or in any other Loan Document or to require giving of notice
or demand to or upon any Person in any situation or for any reason. The addresses for notices are
as follows:



	 	 	 	 	 
	If to Administrative Agent:
	 	Wachovia Financial Services, Inc.
	 
	 	c/o Wachovia Bank, National Association
	 
	 	Real Estate Financial Services
	 
	 	General Banking Group
	 
	 	Mail Code: CA 6233
	 
	 	15750 Alton Parkway
	 
	 	Irvine, California  92618
	 
	 	Attn:  Anne McNeil
	If to Borrower:
	 	c/o Triple Net Properties, LLC
	 
	 	1551 N. Tustin Avenue , Suite 300
	 
	 	Santa Ana, California  92705
	 
	 	Attn:  Shannon Johnson
	With a copy to:
	 	Cox, Castle & Nicholson LLP
	 
	 	2049 Century Park East, 28th Floor
	 
	 	Santa Monica, California 90067
	 
	 	Attention: Kevin Kinigstein, Esq.






13.3 Authority to File Notices. Borrower irrevocably appoints Administrative Agent at its
attorney-in-fact, with full power of substitution, to file for record, at the Borrower’s cost and
expense and in Borrower’s name, any notices of completion, notices of cessation of labor, or any
other notices that Administrative Agent considers necessary or desirable to protect its security.



13.4 Inconsistencies with the Loan Documents. In the event of any inconsistencies between
the terms of this Agreement and any terms of any of the Loan Documents, the terms of this Agreement
shall govern and prevail.



13.5 No Waiver. No disbursement of proceeds of the Loans shall constitute a waiver of any
conditions to Administrative Agent’s or any Lender’s obligation to make further disbursements nor,
in the event Borrower is unable to satisfy any such conditions, shall any such waiver have the
effect of precluding Administrative Agent or the Lenders from thereafter declaring such inability
to constitute a default under this Agreement.



13.6 Administrative Agent Approval of Instruments and Parties. All proceedings taken in
accordance with transactions provided for herein; all surveys, appraisals and documents required or
contemplated by this Agreement and the persons responsible for the execution and preparation
thereof; shall be satisfactory to and subject to reasonable approval by Administrative Agent.
Administrative Agent’s counsel shall be provided with copies of all documents which they may
reasonably request in connection with the Agreement.



13.7 Administrative Agent Determination of Facts. Administrative Agent shall at all times
be free to establish independently, to its satisfaction, the existence or nonexistence of any fact
or facts, the existence or nonexistence of which is a condition of this Agreement.



13.8 Incorporation of Preamble, Recitals and Exhibits. The preamble, recitals and exhibits
hereto are hereby incorporated in to this Agreement.



13.9 Third-Party Consultants. Administrative Agent may hire such third-party consultants
as it deems necessary, the costs of which shall be paid by Borrower, to provide the following
services: (a) perform environmental assessments; (b) provide Appraisals; and (c) perform such other
services as may, from time to time, be reasonably required by Administrative Agent. This
obligation on the part of Borrower shall survive the closing of the Loan and the repayment thereof.



13.10 Costs and Expenses; Indemnification; Reimbursement.



(a) Borrower shall pay (i) all reasonable out of pocket expenses incurred by Administrative
Agent and its Affiliates (but not the expenses of any other Lender), including the reasonable fees,
charges and disbursements of counsel for Administrative Agent and any counsel to any assignee of
Administrative Agent to which the Loan Documents are pledged as security, in connection with the
syndication of the credit facilities provided for herein (to the extent such expenses are
customary), the preparation, negotiation, execution, delivery and administration of this Agreement
and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof
or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated),
(ii) all taxes and assessments and all expenses, charges, costs and fees provided for in this
Agreement or relating to the Loan or any Project then serving as Collateral, including, without
limitation, any fees incurred for recording or filing any of the Loan Documents, title insurance
premiums and charges, tax service contract fees, fees of any consultants, Administrative Agent’s
processing and closing fees, Administrative Agent’s inspection fees, printing, photostating and
duplicating expenses, air freight charges, escrow fees, costs of surveys, premiums of hazard
insurance policies and surety bonds and fees for any appraisal, appraisal review, market or
feasibility study required by Administrative Agent, (iii) all out of pocket expenses incurred by
Administrative Agent or any Lender (including the fees, charges and disbursements of any counsel
for Administrative Agent or any Lender), in connection with the enforcement or protection of its
rights (A) in connection with this Agreement and the other Loan Documents, including its rights
under this Section, or (B) in connection with the Loans made hereunder, including all such out of
pocket expenses incurred during any workout, restructuring or negotiations in respect of such
Loans, and (iv) any civil penalty or fine assessed by OFAC against, and all reasonable costs and
expenses (including counsel fees and disbursements) incurred in connection with defense thereof, by
Administrative Agent or any Lender as a result of conduct of Borrower that violated a sanction
enforced by OFAC.



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



(c) To the extent that the Borrower for any reason fails to indefeasibly pay any amount
required under paragraph (a) or (b) of this Section to be paid by it to
Administrative Agent (or any sub-agent thereof) or any Related Party of Administrative Agent, each
Lender severally agrees to pay to Administrative Agent (or any such sub-agent) or such Related
Party, as the case may be, such Lender’s Ratable Share (determined as of the time that the
applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount,
provided that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against Administrative Agent (or
any such sub-agent) in its capacity as such, or against any Related Party of any of the
Administrative Agent acting for Administrative Agent (or any such sub-agent) in connection with
such capacity. The obligations of the Lenders under this paragraph are several and not joint or
joint and several.



(d) The obligations on the part of Borrower under this Section 13.10 shall survive the
closing of the Loans and the repayment thereof.



13.11 Disclaimer by Administrative Agent and the Lenders. Administrative Agent and the
Lenders shall not be liable to any consultant, service provider, contractor, subcontractor,
supplier, laborer, architect, engineer or any other party for services performed or materials
supplied in connection with the Projects. Administrative Agent and the Lenders shall not be liable
for any debts or claims accruing in favor of any such parties against Borrowers or others or
against any Property or any Project. Borrower is not and shall not be an agent of Administrative
Agent or any Lender for any purpose. Administrative Agent and the Lenders are not joint venture
partners with Borrower in any manner whatsoever. Prior to default by Borrower under this Agreement
and the exercise of remedies granted herein, and Administrative Agent and the Lenders shall not be
deemed to be in privity of contract with any contractor or provider of services to the Projects,
nor shall any payment of funds directly to a contractor, subcontractor, or provider of services be
deemed to create any third party beneficiary status or recognition of same by Administrative Agent
or the Lenders. Approvals granted by Administrative Agent or the Lenders for any matters covered
under this Agreement shall be narrowly construed to cover only the parties and facts identified in
any written approval or, if not in writing, such approvals shall be solely for the benefit of
Borrower.



13.12 Intentionally Omitted.



13.13 Titles and Headings. The titles and headings of sections of this Agreement are
intended for convenience only and shall not in any way affect the meaning or construction of any
provision of this Agreement.



13.14 Brokers. Borrower and Administrative Agent represent to each other that neither of
them knows of any brokerage commissions or finders’ fee due or claimed with respect to the
transaction contemplated hereby. Borrower and Administrative Agent shall indemnify and hold
harmless the other party from and against any and all loss, damage, liability, or expense,
including costs and reasonable attorney fees, which such other party may incur or sustain by reason
of or in connection with any misrepresentation by the indemnifying party with respect to the
foregoing.



13.15 Change, Discharge, Termination, or Waiver. No provision of this Agreement may be
changed, discharged, terminated, or waived except in writing signed by the party against whom
enforcement of the change, discharge, termination, or waiver is sought. No failure on the part of
Administrative Agent or the Lenders to exercise and no delay by Administrative Agent or the Lenders
in exercising any right or remedy under the Loan Documents or under the law shall operate as a
waiver thereof.



13.16 CHOICE OF LAW. THIS AGREEMENT AND THE TRANSACTION CONTEMPLATED HEREUNDER SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT GIVING
EFFECT TO CONFLICT OF LAWS PRINCIPLES.



13.17 Disbursements in Excess of Aggregate Commitment. In the event the total
disbursements by Administrative Agent exceed the Aggregate Commitment, the total of all
disbursements shall nonetheless be secured by the Deeds of Trust. All other sums expended by
Administrative Agent pursuant to this Agreement or any other Loan Documents shall be deemed to have
been paid to Borrower and shall be secured by, among other things, the Deeds of Trust.



13.18 Submission to Jurisdiction; Waiver of Venue; Service of Process.



(a) BORROWER IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA SITTING IN ORANGE COUNTY, THE
COURTS OF THE STATE OF MISSOURI SITTING IN SAINT CHARLES COUNTY, THE COURTS OF THE STATE OF TEXAS
SITTING IN TARRANT COUNTY, THE COURTS OF THE STATE OF TEXAS SITTING IN WICHITA COUNTY, THE COURTS
OF THE STATE OF NEW HAMPSHIRE SITTING IN ROCKINGHAM COUNTY, THE COURTS OF THE STATE OF ARIZONA
SITTING IN PIMA COUNTY, THE COURTS OF THE STATE OF INDIANA SITTING IN MARION COUNTY AND OF THE
UNITED STATES DISTRICT COURTS OF THE CENTRAL DISTRICT OF CALIFORNIA, THE EASTERN DISTRICT OF
MISSOURI, THE NORTHERN DISTRICT OF TEXAS, THE DISTRICT OF NEW HAMPSHIRE, THE DISTRICT OF ARIZONA
AND THE SOUTHERN DISTRICT OF INDIANA AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR
RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH
FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT
OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT
SHALL AFFECT ANY RIGHT THAT ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST BORROWER OR ITS
PROPERTIES IN THE COURTS OF ANY JURISDICTION.



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



(c) EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR
NOTICES IN SECTION 13.2. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY
HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.



13.19 Counterparts. This Agreement may be executed in any number of counterparts each of
which shall be deemed an original, but all such counterparts together shall constitute but one
agreement.



13.20 Time is of the Essence. Time is of the essence of this Agreement.



13.21 Attorneys’ Fees. Without limiting the generality of the expense reimbursement
obligations of Borrower set forth in Section 13.10, Borrower shall promptly pay to
Administrative Agent from Borrower’s own funds or from the proceeds of the Loans, upon demand, with
interest thereon from the date of demand at the default interest rate, reasonable attorneys’ fees
and all costs and other expenses paid or incurred by Administrative Agent in enforcing or
exercising its rights or remedies created by, connected with or provided for in this Agreement or
any of the other Loan Documents, and payment thereof shall be secured by the Deeds of Trust. If at
any time Borrower fails, refuses or neglects to do any of the things herein provided to be done by
Borrower, Administrative Agent shall have the right, but not the obligation, to do the same but at
the expense and for the account of Borrower. The amount of any monies so expended or obligations
so incurred by Administrative Agent, together with interest thereon at the default interest rate,
shall be repaid to Administrative Agent forthwith upon written demand therefor and payment thereof
shall be secured by the Deeds of Trust.



13.22 Signs . Through the term of the Loan, Administrative Agent shall have the right to
erect one of more signs on any Project then serving as Collateral indicating its provision of
financing for the Projects, and Administrative Agent shall also have the right to publicize its
financing of the Projects as Lender may deem appropriate.



13.23 Joint Borrower Provisions. Each Borrower acknowledges and agrees that it shall be
jointly and severally liable for the Loans and all other Obligations arising under this Agreement
and/or any of the other Loan Documents.  In furtherance thereof, each Borrower acknowledges and
agrees as follows:



(a) For the purpose of implementing the joint borrower provisions of the Loan Documents, each
Borrower hereby irrevocably appoints each other Borrower as its agent and attorney-in-fact for all
purposes of the Loan Documents, including the giving and receiving of notices and other
communications.



(b) To induce the Lenders to make the Loans, and in consideration thereof, each Borrower
hereby agrees to indemnify the Administrative Agent, Lenders and the other Indemnitees against, and
hold the Administrative Agent, Lenders and the other Indemnitees harmless from, any and all
liabilities, expenses, losses, damages and/or claims of damage or injury asserted against
Administrative Agent and/or Lenders by any Borrower or by any other Person arising from or incurred
by reason of (i) reliance by the Administrative Agent and/or Lenders on any requests or
instructions from any Borrower, or (ii) any other action taken by Administrative Agent and/or
Lenders in good faith with respect to this Agreement or the other Loan Documents.



(c) Each Borrower acknowledges that the liens and security interests created or granted herein
and by the other Loan Documents will secure Obligations of all Borrowers under the Loan Documents
and, in full recognition of that fact, each Borrower consents and agrees that the Administrative
Agent and/or Lenders may, at any time and from time to time, without notice or demand, and without
affecting the enforceability or security hereof or of any other Loan Document:




(i) agree with any Borrower to supplement, modify, amend, extend, renew,
accelerate, or otherwise change the time for payment or the terms of the Obligations
or any part thereof, including any increase or decrease of the rate(s) of interest
thereon;




(ii) agree with any Borrower to supplement, modify, amend or waive, or enter
into or give any agreement, approval or consent with respect to, the Obligations or
any part thereof or any of the Loan Documents or any additional security or
guaranties, or any condition, covenant, default, remedy, right, representation or
term thereof or thereunder;




(iii) accept new or additional instruments, documents or agreements in exchange
for or relative to any of the Loan Documents or the Obligations or any part thereof;




(iv) accept partial payments on the Obligations;




(v) receive and hold additional security or guaranties for the Obligations or
any part thereof;




(vi) release, reconvey, terminate, waive, abandon, subordinate, exchange,
substitute, transfer and enforce any security for or guaranties of the Obligations,
and apply any security and direct the order or manner of sale thereof as
Administrative Agent, in its sole and absolute discretion may determine;




(vii) release any Person or any guarantor from any personal liability with
respect to the Obligations or any part thereof;




(viii) settle, release on terms satisfactory to Administrative Agent or by
operation of applicable laws or otherwise liquidate or enforce any Obligations and
any security therefor or guaranty thereof in any manner, consent to the transfer of
any such security and bid and purchase at any sale; and consent to the merger,
change or any other restructuring or termination of the corporate existence of any
Borrower or any other Person, and correspondingly restructure the obligations of
such Borrower or other Person, and any such merger, change, restructuring or
termination shall not affect the liability of any Borrower or the continuing
existence of any lien or security interest hereunder, under any other Loan Document
to which any Borrower is a party or the enforceability hereof or thereof with
respect to all or any part of the Obligations.




(d) Upon the occurrence of and during the continuance of any Event of Default,
Administrative Agent may enforce this Agreement and the other Loan Documents independently
as to each Borrower and independently of any other remedy or security Administrative Agent
and/or Lenders at any time may have or hold in connection with the Obligations, and in
collecting on the Loans it shall not be necessary for Administrative Agent to marshal assets
in favor of any Borrower or any other Person or to proceed upon or against and/or exhaust
any other security or remedy before proceeding to enforce this Agreement and the other Loan
Documents. Each Borrower expressly waives any right to require Administrative Agent and/or
Lenders, in connection with Administrative Agent and/or Lender’s efforts to obtain repayment
of the Loans and other Obligations, to marshal assets in favor of any Borrower or any other
Person or to proceed against any other Person or any collateral provided by any other
Person, and agrees that Administrative Agent and/or Lenders may proceed against any Persons
and/or collateral in such order as it shall determine in its sole and absolute discretion in
connection with Administrative Agent’s efforts to obtain repayment of the Loans and other
Obligations. Administrative Agent may file a separate action or actions against each
Borrower to enforce the Obligations, whether action is brought or prosecuted with respect to
any other security or against any other Person, or whether any other Person is joined in any
such action or actions. Each Borrower agrees that Administrative Agent, Lenders, each
Borrower and/or any other Person may deal with each other in connection with the Obligations
or otherwise, or alter any contracts or agreements now or hereafter existing between any of
them, in any manner whatsoever, all without in any way altering or affecting the security of
this Agreement or the other Loan Documents. The rights of Administrative Agent and/or
Lenders hereunder and under the other Loan Documents shall be reinstated and revived, and
the enforceability of this Agreement and the other Loan Documents shall continue, with
respect to any amount at any time paid on account of the Obligations which thereafter shall
be required to be restored or returned by Administrative Agent and/or Lenders as a result of
the bankruptcy, insolvency or reorganization of any Borrower or any other Person, or
otherwise, all as though such amount had not been paid. The enforceability of this
Agreement and the other Loan Documents at all times shall remain effective even though the
any or all Obligations, or any other security or guaranty therefor, may be or hereafter may
become invalid or otherwise unenforceable as against any Borrower or any other Person and
whether or not any Borrower or any other Person shall have any personal liability with
respect thereto. Each Borrower expressly waives any and all defenses to the enforcement of
its obligations under the Loan Documents now or hereafter arising or asserted by reason of
(i) any disability or other defense of any Borrower or any other Person with respect to the
Obligations, (ii) the unenforceability or invalidity of any security or guaranty for the
Obligations or the lack of perfection or continuing perfection or failure of priority of any
security for the Obligations, (iii) the cessation for any cause whatsoever of the liability
of any Borrower or any other Person (other than by reason of the full and
final payment and performance of all Obligations), (iv) any failure of Administrative Agent
and/or Lenders to marshal assets in favor of any of the Borrowers or any other Person,
(v) any failure of Administrative Agent and/or Lenders to give notice of sale or other
disposition of any Collateral for the Obligations to any Borrower or to any other Person or
any defect in any notice that may be given in connection with any such sale or disposition,
(vi) any failure of Administrative Agent and/or Lenders to comply in any non-material
respect with applicable laws in connection with the sale or other disposition of any
Collateral or other security for any Obligation, (vii) any act or omission of Administrative
Agent and/or Lenders or others that directly or indirectly results in or aids the discharge
or release of any Borrower or of any other Person or of any of the Obligations or any other
security or guaranty therefor by operation of law or otherwise, (viii) any law which
provides that the obligation of a surety or guarantor must neither be larger in amount nor
in other respects more burdensome than that of the principal or which reduces a surety’s or
guarantor’s obligation in proportion to the principal obligation, (ix) any failure of
Administrative Agent and/or Lenders to file or enforce a claim in any bankruptcy or other
proceeding with respect to any Person, (x) the election by Administrative Agent, in any
bankruptcy proceeding of any Person, of the application or non-application of
Section 1111(b)(2) of the United States Bankruptcy Code, (xi) any extension of credit or the
grant of any lien under Section 364 of the United States Bankruptcy Code except to extent
otherwise provided in this Agreement, (xii) any use of cash collateral under Section 363 of
the United States Bankruptcy Code, (xiii) any agreement or stipulation with respect to the
provision of adequate protection in any bankruptcy proceeding of any Person, (xiv) the
avoidance of any lien or security interest in favor of Administrative Agent securing the
Obligations for any reason, or (xv) any bankruptcy, insolvency, reorganization, arrangement,
readjustment of debt, liquidation or dissolution proceeding commenced by or against any
Person, including any discharge of, or bar or stay against collecting, all or any of the
Obligations (or any interest thereon) in or as a result of any such proceeding. Without in
any way limiting the foregoing, with respect to the Loan Documents and the Obligations, each
Borrower: (A) waives all rights and defenses arising out of an election of remedies by
Administrative Agent, even though that election of remedies, such as non-judicial
foreclosure with respect to security for Borrowers’ obligations, has destroyed each of their
rights of subrogation and reimbursement against the other by the operation of Section 580(d)
of the California Code of Civil Procedure or otherwise; and (B) waives any right to a fair
value hearing or similar proceeding following a nonjudicial foreclosure of the Obligations,
whether arising under California Code of Civil Procedure Section 580a or otherwise.




(e) The Borrowers represent and warrant to Administrative Agent and Lenders that they
have established adequate means of obtaining from each other, on a continuing basis,
financial and other information pertaining to their respective businesses, operations and
condition (financial and otherwise) and their respective properties, and each now is and
hereafter will be completely familiar with the businesses, operations and condition
(financial and otherwise) of the other and their respective properties. Each Borrower
hereby expressly waives and relinquishes any duty on the part of Administrative Agent and/or
Lenders to disclose to such Borrower any matter, fact or thing related to the businesses,
operations or condition (financial or otherwise) of the other Borrowers or the other
Borrowers’ properties, whether now known or hereafter known by Administrative Agent and/or
Lenders during the life of this Agreement. With respect to any of the Obligations, the
Administrative Agent and/or Lenders need not inquire into the powers of any Borrower or the
officers, employees or other Persons acting or purporting to act on such Borrower’s behalf.




(f) Without limiting the foregoing, or anything else contained in this Agreement, each
Borrower waives all rights and defenses that it may have because the Obligations are secured
by real property. This means, among other things:




(i) Administrative Agent and/or Lenders may collect on the Obligations from any
Borrower without first foreclosing on any real or personal property collateral
pledged by the other Borrowers; and




(ii) If Administrative Agent and/or Lenders foreclose on any real property
collateral pledged by any Borrower for the Obligations: (A) the amount of the
indebtedness owed by the other Borrowers may be reduced only by the price for which
that collateral is sold at the foreclosure sale, even if the collateral is worth
more than the sale price; and (B) Administrative Agent and Lenders may collect from
any Borrower even if Administrative Agent and/or Lenders, by foreclosing on the real
property collateral, has destroyed any right any Borrower may have to collect from
the other Borrowers.




(g) This is an unconditional and irrevocable waiver of any rights and defenses each
Borrower may have because the Obligations are secured by real property. These rights and
defenses include, but are not limited to, any rights or defenses based upon Sections 580a,
580b, 580d or 726 of the California Code of Civil Procedure. Each Borrower expressly waives
any right to receive notice of any judicial or nonjudicial foreclosure or sale of any real
property collateral provided by the other Borrower to secure the Obligations and failure to
receive any such notice shall not impair or affect such Borrower’s obligations hereunder or
the enforceability of this Agreement or the other Loan Documents or any liens created or
granted hereby or thereby.




(h) Notwithstanding anything to the contrary elsewhere contained herein or in any other
Loan Document to which any Borrower is a party, with respect to the Loans and all other
Obligations, each Borrower hereby waives with respect to the other Borrowers and their
successors and assigns (including any surety) and any other Person any and all rights at law
or in equity, to subrogation, to reimbursement, to exoneration, to contribution, to setoff,
to any other rights and defenses available to it by reason of California Civil Code
Sections 2787 and 2855, inclusive, or to any other rights that could accrue to a surety
against a principal, to a guarantor against a maker or obligor, to an accommodation party
against the party accommodated, or to a holder or transferee against a maker and which each
of them may have or hereafter acquire against the other or any other Person in connection
with or as a result of such Borrower’s execution, delivery and/or performance of this
Agreement or any other Loan Document to which it is a party until the Obligations are paid
and performed in full. Each Borrower agrees that it shall not have or assert any such
rights against any other Borrower or any other Borrower’s successors and assigns or any
other Person (including any surety), either directly or as an attempted setoff to
any action commenced against such Borrower by any other Borrower (as borrower or in any
other capacity) or any other Person until the all Obligations are paid and performed in
full. Each Borrower hereby acknowledges and agrees that this waiver is intended to benefit
Administrative Agent and Lenders and shall not limit or otherwise affect any Borrower’s
liability under this Agreement or any other Loan Document to which it is a party, or the
enforceability hereof or thereof.




(i) Each Borrower warrants and agrees that each of the waivers and consents set forth
herein is made with full knowledge of its significance and consequences, with the
understanding that events giving rise to any defense waived may diminish, destroy or
otherwise adversely affect rights which each otherwise may have against the other, against
Administrative Agent and Lenders or others, or against any collateral. If any of the
waivers or consents herein are determined to be contrary to any applicable law or public
policy, such waivers and consents shall be effective to the maximum extent permitted by law.



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



13.25 WAIVER OF SPECIAL DAMAGES. BORROWER WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY
LAW, ANY RIGHT BORROWER MAY HAVE TO CLAIM OR RECOVER FROM ADMINISTRATIVE AGENT OR ANY LENDER IN ANY
LEGAL ACTION OR PROCEEDING ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES.



13.26 USA Patriot Act Notification. The following notification is provided to Borrower
pursuant to Section 326 of the USA Patriot Act of 2001, 31 U.S.C. Section 5318:



IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT. To help the
government fight the funding of terrorism and money laundering activities, Federal
law requires all financial institutions to obtain, verify, and record information
that identifies each person or entity that opens an account, including any deposit
account, treasury management account, loan, other extension of credit, or other
financial services product. What this means for Borrower: When Borrower opens an
account, if Borrower is an individual, Administrative Agent will ask for Borrower’s
name, taxpayer identification number, residential address, date of birth, and other
information that will allow Administrative Agent to identify Borrower, and, if
Borrower is not an individual, Administrative Agent will ask for Borrower’s name,
taxpayer identification number, business address, and other information that will
allow Administrative Agent to identify Borrower. Administrative Agent may also ask,
if Borrower is an individual, to see Borrower’s driver’s license or other
identifying documents, and, if Borrower is not an individual, to see Borrower’s
legal organizational documents or other identifying documents.



13.27 Amendments and Waivers. Administrative Agent and Borrower may, from time to time,
with the written consent of the Required Lenders, enter into written amendments, supplements or
modifications for the purpose of adding any provisions to this Agreement or the Notes or changing
in any manner the rights of the Lenders or Borrower hereunder or thereunder, and with the consent
of the Required Lenders, Administrative Agent on behalf of the Lenders may execute and deliver to
Borrower a written instrument waiving, on such terms and conditions as the Administrative Agent may
specify in such instrument, any of the requirements of this Agreement, the Notes or any Event of
Default and its consequences; provided, however, that no such waiver and no such
amendment, supplement or modification shall reduce the rate or extend the final maturity of any
Note or time of payment of principal, interest or fees on any Note or reduce the principal amount
of any Note, or change the amount or terms of any Lender’s Loan or Ratable Share or the amount of
any Lender’s Commitment (except for (i) changes resulting from an assignment permitted hereunder or
(ii) as provided in Section 2.14), or change Section 13.28(b) in a manner that
would alter the pro rata sharing of payments required thereby, or release any Guarantor from the
Guaranty to which it is a party, or amend, modify, change or waive any provision of this Section,
or reduce the percentage specified in the definition of Required Lenders, or consent to the
assignment or transfer by Borrower of any of its rights and obligations under this Agreement, or
consent to the release any material portion of the collateral (unless otherwise permitted under
this Agreement), or amend, modify or change any other provision of this Agreement that requires the
consent of all Lenders, in each case without the written consent of all Lenders; and
provided, further, that no such waiver and no such amendment, supplement or
modification shall amend, modify, change or waive any provision relating to the rights or
obligations of Administrative Agent without the consent of Administrative Agent. Any such waiver
and any such amendment, supplement or modification shall be binding upon Borrower, Administrative
Agent and each Lender, and all future holders of the Notes. In the case of any waiver, Borrower,
Administrative Agent and each Lender shall be restored to their former position and rights
hereunder and under the outstanding Notes, and any Event of Default waived shall be deemed to be
cured and not continuing; but no such waiver shall extend to any subsequent or other Event of
Default, or impair any right consequent thereon. Notwithstanding anything to the contrary herein,
no Defaulting Lender shall have any right to approve or disapprove any amendment, modification,
waiver or consent hereunder, except that the Commitment of such Lender may not be increased without
the consent of such Lender.



13.28 Setoff; Sharing of Payments by Lenders.



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



(b) If any Lender shall, by exercising any right of setoff or counterclaim or otherwise,
obtain payment in respect of any principal of or interest on any of its Loans or other obligations
hereunder resulting in such Lender’s receiving payment of a proportion of the aggregate amount of
its Loans and accrued interest thereon or other such obligations greater than its pro rata share
thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify
Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the
Loans and such other obligations of the other Lenders, or make such other adjustments as shall be
equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on their respective Loans
and other amounts owing them, provided that: (i) if any such participations are purchased
and all or any portion of the payment giving rise thereto is recovered, such participations shall
be rescinded and the purchase price restored to the extent of such recovery, without interest; and
(ii) the provisions of this paragraph shall not be construed to apply to (x) any payment made by
Borrower pursuant to and in accordance with the express terms of this Agreement or (y) any payment
obtained by a Lender as consideration for the assignment of or sale of a participation in any of
its Loans to any assignee or participant, other than to Borrower or any Subsidiary thereof (as to
which the provisions of this paragraph shall apply). Borrower consents to the foregoing and
agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against Borrower rights of setoff
and counterclaim with respect to such participation as fully as if such Lender were a direct
creditor of Borrower in the amount of such participation.



13.29 Application of Proceeds. Prior to the occurrence of an Event of Default,
Administrative Agent shall apply all payments and prepayments in respect of the Notes in such order
as shall be specified by Borrower. After the occurrence of an Event of Default, Administrative
Agent shall, unless otherwise specified at the direction of the Required Lenders which direction
shall be consistent with the last two sentences of the penultimate paragraph of this Section, apply
all payments and prepayments in respect of the Notes and all proceeds of collateral, if any, and
any enforcement action (or other realization), in the following order:



(a) first, to pay all costs and expenses incurred in connection with such sale of collateral
or enforcement action (or other realization), including reasonable attorneys’ fees and expenses
actually incurred (including, without limitation, the expenses and other allocated costs of
internal counsel and expenses and costs associated with any collateral disposition or enforcement
action (or other realization);



(b) second, to pay all late charges then due under the Loan Documents;



(c) third, to pay all accrued interest on and then principal of any portion of the Loans which
Administrative Agent may have advanced on behalf of any Lender for which Administrative Agent has
not then been reimbursed by such Lender or Borrower;



(d) fourth, to pay any fees, expenses, reimbursements or indemnities then due to
Administrative Agent;



(e) fifth, to pay any fees, expenses, reimbursements or indemnities then due under the Loan
Documents to the Lenders;



(f) sixth, to pay all accrued interest in respect of the Loans and any obligations owing under
any Swap Contracts;



(g) seventh, to the ratable payment or prepayment of principal outstanding on the Loans in
such order as Administrative Agent may determine in its sole discretion; and



(h) eighth, to the ratable payment of all other amounts payable under the Notes or under the
other Loan Documents.



Borrower shall remain liable and will pay, on demand, any deficiency remaining in respect of
the Notes and the other Loan Documents, together with interest thereon pursuant to the terms of
this Agreement. The order of priority set forth in clauses (b) and (c) above and the related
provisions of this Agreement are set forth solely to determine the rights and priorities of
Administrative Agent. The order of priority set forth in clauses (d), (e) and (f) above may be
changed only with the prior written consent of all the Lenders without necessity of notice to or
consent of or approval by Borrower, or any other Person. The order of priority set forth in
clauses (b) and (c) above may be changed only with the prior written consent of Administrative
Agent.



Notwithstanding any provisions concerning distribution of payments to the contrary in this
Agreement, so long as any Event of Default exists that has not been waived by the Required Lenders,
each Lender shall share in any payments or proceeds, including proceeds of any collateral, received
by Administrative Agent or any Lender made or received at any time from and after any Event of
Default (“Proceeds after Default”) in an amount equal to such Lender’s Ratable Share of the
Proceeds after Default; provided, however, if any one or more of the Lenders has
not made any funding when required hereunder, the distribution of Proceeds after Default shall be
adjusted so that each Lender shall receive Proceeds after Default in an amount equal to (1) the
Proceeds after Default multiplied by (2) the percentage (rounded to five decimal places) of the
total amount outstanding funded by all the Lenders that such Lender has actually funded. If
necessary, Administrative Agent and each Lender shall use the adjustments procedure set forth in
Section 13.28(b) to make the appropriate distributions to the Lenders as set forth in this
paragraph of this Article.



13.30 Swap Contracts. Prior to or substantially concurrently with the Closing Date (and as
an additional condition precedent to the obligation of Agent and Lenders to make advances
hereunder), Borrower may enter into Swap Contracts with Wachovia Bank or with another Lender (or
with Affiliates of Wachovia Bank or such other Lender), or with another financial institution
satisfactory to Administrative Agent, for the purpose of hedging and protecting against interest
rate fluctuation risks with respect to the Loans, with a notional amount of at least the Aggregate
Commitment and a term at least until the Maturity Date, and on such additional terms and conditions
as are mutually approved by Borrower and Administrative Agent and as are acceptable to Wachovia
Bank or such other Lender (or their Affiliates), or such other financial institution, as
applicable. So long as any Deed of Trust encumbers a Project and the Swap Contract has been
provided by Wachovia Bank or another Lender (or any of their Affiliates) in connection with the
Loans, Borrower’s obligations (including any payment obligations) with respect to any such Swap
Contract shall be secured by the Deeds of Trust and any other Collateral, and any default by
Borrower under any such Swap Contract shall, at the discretion of Administrative Agent, constitute
an Event of Default under this Agreement. All Swap Contracts, if any, between Borrower and
Wachovia Bank or any other Lender (or any of their Affiliates) are independent Agreements governed
by the written provisions of the Swap Contracts, which will remain in full force and effect,
unaffected by any repayment, prepayment, acceleration, reduction, increase or change in the terms
of any Notes or other Loan Documents, except as otherwise expressly provided in the written Swap
Contracts, and any payoff statement from Administrative Agent relating to the Notes shall not apply
to the Swap Contracts except as otherwise expressly provided in such payoff statement. By its
signature below, Borrower waives any right under California Civil Code Section 2954.10 (to the
extent applicable) or otherwise to prepay the Loans, in whole or in part, without payment of any
and all amounts specified or required under the terms of any Swap Contracts (the “Indemnified
Amounts”). Borrower acknowledges that prepayment of the Loans may result in Lenders and their
Affiliates incurring additional losses, costs, expenses and liabilities, including lost revenues
and lost profits in connection with the Swap Contracts or otherwise. Borrower therefore agrees to
pay any and all Indemnified Amounts if the Loans are prepaid, whether voluntarily or by reason of
acceleration, including acceleration upon any transfer or conveyance of any right, title or
interest in any Property giving Administrative Agent the right to accelerate the maturity of the
Loan as provided in the Loan Documents. Borrower agrees that Lenders’ willingness to offer the
Loans to Borrower is sufficient and independent consideration, given individual weight by Lenders,
for this waiver. Borrower understands that Lenders would not offer the Loans to Borrower absent
this waiver.



ARTICLE XIV




RELEASE OF PROJECTS




14.1 Borrower’s Acknowledgment Regarding Buyer Financing. Borrower acknowledges that
Administrative Agent has not in any manner, by this Agreement or otherwise, committed to provide
any financing to or for the buyers of any Project other than the financing of the Tranche Two
Projects and the Tranche Three Projects to the extent the conditions to such financing set forth
herein have been satisfied (or otherwise waived in writing by Administrative Agent).



14.2 Full Payment. Except as provided in this Section 14, unless Administrative
Agent otherwise consents in writing, no Project or any part thereof shall be released until all
indebtedness and obligations of Borrower under the Loan Documents have been paid and performed in
full and all Swap Contracts have been terminated (or sold or transferred on terms mutually
acceptable to Borrower and the swap provider) and all indebtedness and obligations owing thereunder
or in connection therewith have been paid and performed in full.



14.3 Partial Release. At the written request of Borrower, Administrative Agent shall
release Projects from the lien of the applicable Deeds of Trust upon the satisfaction of all the
following conditions precedent with respect to the Project being released:



(a) at the time of the release no Event of Default or Unmatured Event of Default shall have
occurred and be continuing;



(b) after giving effect to the proposed release, no less than three (3) Projects shall remain
Collateral;



(c) the Project must be transferred to a non-Borrower.



(d) Borrower shall have paid all fees and costs in connection with the release, including
recording and reconveyance fees and costs, and any fees and costs reasonably incurred by
Administrative Agent;



(e) Concurrently with Administrative Agent’s release of each of the Projects, Borrower shall
pay to Administrative Agent (for the ratable benefit of the Lenders) a release payment equal to the
greatest of the following amounts:



(i) One hundred ten percent (110%) of the then current Adjusted Loan Basis for such Project;



(ii) The minimum amount which, when applied to the outstanding principal balance of the Loans,
would result in a Debt Service Coverage Ratio (based on the Projects remaining as Collateral after
the proposed release) equal to 1.25:1.0; or



(iii) The minimum amount which, when applied to the outstanding principal balance of the
Loans, would result in an Loan-to-Value Ratio of not more than sixty-six percent (66%), based on
the Projects remaining as Collateral after giving effect to the proposed release;



(f) Borrower shall provide to Lender at Borrower’s sole cost and expense such title insurance
endorsements to the Title Insurance Policies for the remaining Deeds of Trust as Administrative
Agent shall reasonably request, in form and substance reasonably satisfactory to Administrative
Agent, which shall insure that after such release, the remaining Deeds of Trust shall continue as
valid first position liens against the Projects covered thereby.



14.4 Release of Borrowers. Prior to a Borrower acquiring a Project serving as Collateral,
such Borrower may be released as a Borrower under the Loan Documents upon the satisfaction of all
the following conditions precedent:



(a) Administrative Agent shall have received a written request for such release; and



(b) The Borrower to be released shall have executed and delivered to Administrative Agent such
written releases of Administrative Agent and Lenders as reasonably required by Administrative
Agent.



ARTICLE XV




EXHIBITS




The following exhibits to this Agreement are fully incorporated herein as if set forth at
length:



Exhibit A — Property Description



Exhibit B – Form of Assignment and Assumption Agreement



Exhibit C – Loan Budget



Exhibit D – Form of Note



Exhibit E – Commitments



Exhibit F – Closing Conditions



Exhibit G – Form of Borrowing Notice



[Signatures Appear on Following Page]




5




IN WITNESS WHEREOF, Administrative Agent and Borrower have caused this Agreement to be
duly executed and delivered as of the date first above written.



	 
	"Administrative Agent”

WACHOVIA FINANCIAL SERVICES, INC., a

North Carolina corporation, as Administrative Agent

By: /s/ Anne McNeil

Name: Anne McNeil

Title: Vice President

	"Lenders”

WACHOVIA FINANCIAL SERVICES, INC., a

North Carolina corporation, as a Lender

By: /s/ Anne McNeil

Name: Anne McNeil

Title: Vice President







6





	 	 	“Borrowers”






G&E HEALTHCARE REIT EPLER PARKE


BUILDING B, LLC,


a Delaware limited liability company




	 	 	 	By: /s/ Andrea R.
Biller






	 	 	Name: Andrea R. Biller






	 	 	 	Its: Authorized
Signatory






G&E HEALTHCARE REIT 5995 PLAZA DRIVE,


LLC,


a Delaware limited liability company




	 	 	 	By: /s/ Andrea R.
Biller






	 	 	Name: Andrea R. Biller






	 	 	 	Its: Authorized
Signatory






G&E HEALTHCARE REIT NUTFIELD


PROFESSIONAL CENTER, LLC,


a Delaware limited liability company




	 	 	 	By: /s/ Andrea R.
Biller






	 	 	Name: Andrea R. Biller






	 	 	 	Its: Authorized
Signatory






G&E HEALTHCARE REIT ACADEMY, LLC,


a Delaware limited liability company




	 	 	 	By: /s/ Andrea R.
Biller






	 	 	Name: Andrea R. Biller






	 	 	 	Its: Authorized
Signatory






G&E HEALTHCARE REIT MEDICAL PORTFOLIO


2, LLC,


a Delaware limited liability company




	 	 	 	By: /s/ Andrea R.
Biller






	 	 	Name: Andrea R. Biller






	 	 	 	Its: Authorized
Signatory






7