Exhibit 10.1


    
      

    

     

    


    Exhibit
      10.1

    


    MODIFICATION
      AGREEMENT

    


    


    THIS
      MODIFICATION AGREEMENT (this “Agreement”) is made the 28th day of February, 2006
      (the “Execution Date” and “Effective Date”) by and between Hartman REIT
      Operating Partnership II, L.P., a Texas limited partnership, with an address
      at
      c/o Hartman Management, L.P., 1450 West Sam Houston Parkway North, Suite 100,
      Houston, Texas 77057 (hereinafter referred to as “Borrower” or “Maker”) and
      Wells Fargo Bank, N.A. (f/k/a Wells Fargo Bank Minnesota, National Association)
      as Trustee for the Registered Holders of GMAC Commercial Mortgage Securities,
      Inc., Mortgage Pass-Through Certificates, Series 2003-FL1 with an office at
      c/o
      GMAC Commercial Mortgage Corporation, 200 Witmer Road, Horsham, PA 19044
      (hereinafter referred to as “Lender” or “Mortgagee”).

    


    RECITALS

    


    A.    Borrower
      is the owner in fee simple of certain parcels of land and improvements thereon
      located in Houston, Texas (the “Premises”), which Premises are more particularly
      described in that certain Deed of Trust and Security Agreement dated December
      20, 2002 (the “Deed of Trust”) between Borrower and GMAC Commercial Mortgage
      Corporation (the “Original Lender”).

    


    B.    On
      December 20, 2002 (the “Closing Date”), Borrower executed and delivered to
      Original Lender, inter alia,
      a
      Promissory Note (the “Note”) evidencing a loan in the principal amount of Thirty
      Four Million Four Hundred Forty Thousand Dollars ($34,440,000.00) (the “Loan”),
      repayment of which is secured, inter alia,
      by the
      Deed of Trust and an Assignment of Leases of Rents dated December 20, 2002
      from
      Borrower to Original Lender (the “Assignment”) (the Note, Deed of Trust,
      Assignment and the other documents described in or accompanying the Note, as
      amended from time to time, being hereinafter collectively referred to as the
      “Loan Documents”). 

    


    C.    Original
      Lender assigned all of its interest in the Loan Documents to
      Lender.

    


    D.    Borrower
      submitted to Lender an Extension Notice (as defined in the Note) to extend
      the
      Initial Term (as defined in the Note) and the corresponding Maturity Date (as
      defined in the Note) for one (1) additional period of two years.

    


    E.    Lender
      has agreed to extend the Maturity Date subject to satisfaction of the conditions
      set forth in the Note and this Agreement.

    


    NOW,
      THEREFORE, in consideration of the premises and of the mutual covenants and
      undertakings herein contained, the parties hereto, intending to be legally
      bound, covenant and agree as follows:

    


    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    


    


    1.    Borrower
      covenants and confirms that all of the above outlined Recitals set forth in
      this
      Agreement are true, correct and complete in every respect and are incorporated
      herein and made a part hereof. Borrower acknowledges that Lender in entering
      into this Agreement is relying on such covenants and confirmations.

    


    2.    The
      Maturity Date on which the entire principal balance as well as any accrued
      and
      unpaid interest and any other sums required to be paid thereunder shall be
      due
      and payable is extended from January 1, 2006 to January 1, 2008.

    


    3.    The
      outstanding balance of the Loan as of January 25, 2006 is $34,440,000.00 in
      principal plus all unpaid and accrued interest. Borrower acknowledges and agrees
      that the unfunded balance of the Loan will not be funded by Lender, and Borrower
      is not entitled to any additional advances of the Loan.

    


    4.    Borrower
      shall continue to make monthly payments of interest only on the first (1st)
      day
      of each month pursuant to the terms of the Note. 

    


    5.    As
      an
      inducement to Lender to enter into this Agreement, Borrower represents,
      warrants, covenants and agrees as follows:

    


    (a)    Borrower
      has full power, authority and legal right to own its properties and assets
      and
      to conduct its business as currently conducted.

    


    (b)    Borrower
      has full power, authority and legal right to execute and deliver, and to perform
      and observe the provisions of, this Agreement and any document executed pursuant
      to or in connection with this Agreement and to carry out the transactions
      contemplated hereby.

    


    (c)    This
      Agreement constitutes the legal, valid and binding obligation of Borrower
      enforceable against Borrower in accordance with its terms.

    


    (d)    The
      execution and delivery of this Agreement, and any documents executed pursuant
      to
      this Agreement, and compliance with their respective terms as contemplated
      herein, will not result in a breach of any of the terms or conditions of, or
      result in the imposition of any lien, charge or encumbrance upon any property
      of
      Borrower pursuant to, or constitute a default (with due notice or lapse of
      time
      or both) or result in an occurrence of any event for which any holder or holders
      of indebtedness for money borrowed may declare the same due and payable under
      any indenture, agreement, order, judgment or instrument to which Borrower is
      a
      party or by which Borrower or its property may be bound or affected, and will
      not violate any provision of applicable law.

    


    (e)    Borrower
      has good and marketable title to the Premises and the Premises is not subject
      to
      any lien, claim or interest (including any encumbrance, security interest or
      mechanic’s or materialmen’s lien), except for those: (i) in favor of
      Lender; and (ii) which existed of record on the Closing Date and were
      approved by Lender.

    


    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    


    


    (f)    There
      is
      no litigation pending or to the best of Borrower’s knowledge threatened against
      Borrower which could in any way adversely affect title to the Premises or any
      part thereof or otherwise result in a material adverse change in the financial
      condition of Borrower or any guarantor of the Loan.

    


    (g)    All
      of
      the representations and warranties of Borrower under the Loan Documents are
      hereby restated and reaffirmed as true and correct by Borrower as of the date
      thereof and hereof and are incorporated herein in their entirety by this
      reference.

    


    (h)    Borrower
      is aware that each of the representations and warranties of Borrower contained
      in this Agreement is material to Lender in entering into this
      Agreement.

    


    6.    Borrower
      covenants and confirms that, except as specifically modified by this Agreement,
      all of the terms and conditions of the Loan Documents shall be unmodified and
      remain in full force and effect. This Agreement shall not be construed as a
      novation of the Note or the other Loan Documents. This Agreement shall not
      prejudice any present or future rights, remedies, benefits or powers belonging
      or accruing to Lender under the terms of the Loan Documents as amended by this
      Agreement.  

    


    7.    This
      Agreement shall in no way adversely affect or impair the lien priority of the
      Deed of Trust or the other Loan Documents. If this Agreement or any part hereof,
      or any instrument executed in connection herewith, shall be construed or shall
      operate to affect the lien priority of the Deed of Trust or the other Loan
      Documents, then to the extent third persons acquiring an interest or lien upon
      the Premises between the time of recording of the Deed of Trust or other Loan
      Documents and the execution of this Agreement are prejudiced thereby, this
      Agreement shall be void and of no further force and effect. Notwithstanding
      the
      foregoing, the parties hereto, as between themselves, shall be bound by all
      of
      the terms and conditions of this Agreement until all indebtedness owing from
      Borrower to Lender has been paid.

    


    8.    As
      a
      condition precedent to the effectiveness of this Agreement, on or before the
      Execution Date, Borrower shall deposit with Lender the sum of $385,000.00 (the
      “Additional Roof Deposit”) to be held and disbursed by Lender pursuant to the
      terms and conditions of that certain Replacement Reserve Agreement between
      Borrower and Lender.

    


    9.    This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of Texas.

    


    10.    Each
      and
      every one of the terms and provisions of this Agreement shall be binding upon
      Borrower, its successors and assigns and shall inure to the benefit of Lender,
      its successors and assigns.

    


    11.    No
      failure to exercise, and no delay in exercising, any right, power or remedy
      under this Agreement or under any document delivered by Borrower pursuant hereto
      or heretofore pursuant to the transactions contemplated hereby shall impair
      any
      right, power or remedy which Lender may have, nor shall any such delay be
      construed to be a waiver of any of such rights, powers or remedies, or an
      acquiescence in any breach or default under this Agreement
      or any document delivered pursuant to this Agreement or the transactions
      contemplated hereby, nor shall any waiver of any breach or default of Borrower
      be deemed a waiver of any default or breach subsequently occurring.

     

    


    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    


    


    12.    If
      any
      one or more of the provisions contained in this Agreement is determined to
      be
      invalid, illegal or unenforceable in any respect, the validity, legality and
      enforceability of the remaining provisions contained herein shall not in any
      way
      be affected or impaired thereby.

    


    13.    Borrower
      shall be responsible for the payment of all costs and expenses related to the
      modification and/or amendment of the Loan Documents set forth in this
      Agreement.

    


    14.    This
      Agreement and the Loan Documents constitute the entire agreement between the
      parties hereto with respect to the subject matter hereof. This Agreement
      supersedes all previous negotiations and discussions between the parties, and
      no
      parol evidence of any prior or other agreement shall be permitted to contradict
      or vary the terms hereof. In the event of any inconsistencies between the
      provisions of this Agreement and the Loan Documents, the provisions of this
      Agreement shall control.

    


    15.    Unless
      the context otherwise specifies or requires, all of the terms used in this
      Agreement shall be applicable equally to the singular and plural forms of such
      terms and to all genders.

    


    16.    This
      Agreement may be executed in one or more counterparts by some or all of the
      parties hereto, each of which counterparts shall be an original and all of
      which
      together shall constitute a single agreement.

    


    17.    All
      capitalized terms not defined herein shall have the meanings ascribed to such
      terms in the Loan Documents. 

    


    [Intentionally
      Blank; Signature on Next Page]

    


    


    


    


    


    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    


    


     

    


    WITNESS
      the due execution hereof as a document under seal, with the intent to be legally
      bound hereby.

    


    
      	 	
              HARTMAN
                REIT OPERATING 

            
	 	
              PARTNERSHIP
                II, L.P., a Texas limited

              partnership

            
	 	 
	 	
              By:    
                Hartman REIT Operating

                        
                Partnership II GP, LLC, a Delaware

              
                          
                  limited liability company 

              

            
	 	
               

            
	 	
                        
                By:      /s/
                Allen R. Hartman

            
	 	
                       
                        Name: Allen R.
                Hartman

            
	 	
                       
                        Title:
                President

            
	 	 
	 	 
	 	
              Wells
                Fargo Bank, N.A. (f/k/a Wells Fargo

              Bank
                Minnesota, National Association) as

              Trustee
                for the Registered Holders of

              GMAC
                Commercial Mortgage Securities,

              Inc.,
                Mortgage Pass-Through Certificates,

              Series
                2003-FL1

            
	 	 
	 	 
	 	
                        
                By:     GMAC Commercial 

            
	 	
                                   
                Mortgage Corporation, its 

            
	 	
                                  
                 Master Servicer

            
	 	 
	 	
                        
                By:     /s/
                Jillian M. Brittin

            
	 	
               
                               
                Name: Jillian M. Brittin

            
	 	
                               
                Title: Vice President