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Exhibit 10.1

                      UNSECURED REVOLVING CREDIT AGREEMENT

                           DATED AS OF JANUARY 6, 1998

                                      AMONG

                       GREAT LAKES REIT, L.P., AS BORROWER

                                       AND

             BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION

                                       AND

                       THE FIRST NATIONAL BANK OF CHICAGO

                                   AS LENDERS

                                       AND

                       THE FIRST NATIONAL BANK OF CHICAGO

                             AS DOCUMENTATION AGENT

                                       AND

             BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,

                             AS ADMINISTRATIVE AGENT



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                                TABLE OF CONTENTS




ARTICLE I  DEFINITIONS AND ACCOUNTING TERMS..................................1
         1.1 Definitions.....................................................1
         1.2 Financial Standards.............................................5

ARTICLE II  THE FACILITY.....................................................5
         2.1 The Facility....................................................5
         2.2 Principal Payments..............................................5
         2.3 Requests for Advances: Responsibility for Advances..............5
         2.4 Evidence of Credit Extensions...................................5
         2.5 Ratable Loans...................................................5
         2.6 Unused Commitment Fee...........................................5
         2.7 Other Fees......................................................5
         2.8 Minimum Amount of Each Advance..................................5
         2.9 Interest........................................................5
         2.10 Selection of Rate Options and LIBOR Interest Periods...........5
         2.11 Method of Payment..............................................5
         2.12 Default........................................................5
         2.13 Lending Installations..........................................5
         2.14 Non-Receipt of Funds by Administrative Agent...................5
         2.15 Application of Moneys Received.................................5
         2.16Voluntary Reduction of Aggregate Commitment Amount..............5

ARTICLE III  INTENTIONALLY DELETED...........................................5

ARTICLE IV  CHANGE IN CIRCUMSTANCES..........................................5
         4.1 Yield Protection................................................5
         4.2 Changes in Capital Adequacy Regulations.........................5
         4.3 Availability of LIBOR Advances..................................5
         4.4 Funding Indemnification.........................................5
         4.5 Lender Statements; Survival of Indemnity........................5

ARTICLE V  CONDITIONS PRECEDENT..............................................5
         5.1 Conditions Precedent to Closing.................................5
         5.2 Conditions Precedent to Subsequent Advances.....................5

ARTICLE VI  REPRESENTATIONS AND WARRANTIES...................................5
         6.1 Existence.......................................................5
         6.2 Corporate/Partnership Powers....................................5
         6.3 Power of Officers...............................................5
         6.4 Government and Other Approvals..................................5
         6.5 Solvency........................................................5
         6.6 Compliance With Laws and Agreements.............................5
         6.7 Enforceability of Agreement.....................................5
         6.8 Title to Property...............................................5
         6.9 Litigation......................................................5
         6.10 Events of Default..............................................5
         6.11 Investment Company Act of 1940.................................5


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         6.12 Public Utility Holding Company Act.............................5
         6.13 Regulation U...................................................5
         6.14 No Material Adverse Financial Change...........................5
         6.15 Financial Information..........................................5
         6.16 Factual Information............................................5
         6.17 ERISA..........................................................5
         6.18 Taxes..........................................................5
         6.19 Environmental Matters..........................................5
         6.20 Insurance......................................................5
         6.21 No Brokers.....................................................5
         6.22 No Violation of Usury Laws.....................................5
         6.23 Not a Foreign Person...........................................5
         6.24 No Trade Name..................................................5
         6.25 Subsidiaries...................................................5
         6.26 Properties.....................................................5
         6.27 Relationship of the Borrower...................................5
         6.28 No Side Deals..................................................5

ARTICLE VII  FINANCIAL COVENANTS.............................................5
         7.1 Minimum Consolidated Net Worth..................................5
         7.2 Maximum Consolidated Leverage Ratio.............................5
         7.3 Minimum Consolidated Interest Coverage Ratio....................5
         7.4 Minimum Fixed Charge Coverage Ratio.............................5
         7.5 Maximum Unencumbered Asset Coverage Ratio.......................5
         7.6 Minimum Unencumbered Asset NOI to Unsecured Interest............5
         7.7 Maximum Secured Debt to Gross Asset Value.......................5
         7.8 Maximum Dividend Payout Ratio...................................5

ARTICLE VIII  AFFIRMATIVE COVENANTS..........................................5
         8.1 Notices.........................................................5
         8.2 Financial Statements, Reports. Etc..............................5
         8.3 Existence and Conduct of Operations.............................5
         8.4 Maintenance of Properties.......................................5
         8.5 Insurance.......................................................5
         8.6 Payment of Obligations..........................................5
         8.7 Compliance with Laws............................................5
         8.8 Adequate Books..................................................5
         8.9 ERISA...........................................................5
         8.10 Maintenance of Status..........................................5
         8.11 Use of Proceeds................................................5
         8.12 Pre-Acquisition Environmental Investigations...................5
         8.13 New Subsidiaries...............................................5
         8.14 Distributions..................................................5

ARTICLE IX  NEGATIVE COVENANTS...............................................5
         9.1 Change in Business..............................................5
         9.3 Change of Borrower Ownership....................................5
         9.4 Use of Proceeds.................................................5
         9.5 Transfers of Unencumbered Assets................................5
         9.6 Liens...........................................................5
         9.7 Regulation U....................................................5


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         9.8 Mergers and Dispositions........................................5
         9.9 Negative Pledge.................................................5
         9.10 Consolidated Secured Recourse Debt.............................5

ARTICLE X  DEFAULTS..........................................................5
         10.1 Nonpayment of Principal........................................5
         10.2 Certain Covenants..............................................5
         10.3 Nonpayment of Interest and Other Obligations...................5
         10.4 Cross Default..................................................5
         10.5 Loan Documents.................................................5
         10.6 Representation or Warranty.....................................5
         10.7 Covenants, Agreements and Other Conditions.....................5
         10.8 No Longer General Partner......................................5
         10.9 Material Adverse Financial Change..............................5
         10.10 Bankruptcy....................................................5
         10.11 Legal Proceedings.............................................5
         10.12 ERISA.........................................................5
         10.13 Failure to Satisfy Judgments..................................5
         10.14 Environmental Remediation.....................................5

ARTICLE XI  ACCELERATION, WAIVERS AMENDMENTS AND REMEDIES....................5
         11.1 Acceleration...................................................5
         11.2 Preservation of Rights; Amendments.............................5

ARTICLE XII  THE ADMINISTRATIVE AGENT........................................5
         12.1 Appointment....................................................5
         12.2 Powers.........................................................5
         12.3 General Immunity...............................................5
         12.4 No Responsibility for Loans, Recitals, etc.....................5
         12.5 Action on Instructions of Lenders..............................5
         12.6 Employment of Administrative Agents and Counsel................5
         12.7 Reliance on Documents..........................................5
         12.8 Administrative Agent's Reimbursement and Indemnification.......5
         12.9 Rights as a Lender.............................................5
         12.10 Commitment as a Lender........................................5
         12.11 Lender Credit Decision........................................5
         12.12 Successor Administrative Agent................................5
         12.13 Notice of Defaults............................................5
         12.14 Requests for Approval.........................................5
         12.15 Copies of Documents...........................................5
         12.16 Defaulting Lenders............................................5
         12.17 Withholding Tax...............................................5
         12.18 Borrower's Default; Enforcement...............................5
         12.19 Workout.......................................................5
         12.20 Bankruptcy of Borrower........................................5
         12.21 Relationship of Parties.......................................5
         12.22 Counsel.......................................................5

ARTICLE XIII  BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS..............5
         13.1 Successors and Assigns.........................................5
         13.2 Participations.................................................5


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         13.3 Assignments....................................................5
         13.4 Dissemination of Information...................................5
         13.5 Tax Treatment..................................................5

ARTICLE XIV  GENERAL PROVISIONS..............................................5
         14.1 Survival of Representations....................................5
         14.2 Governmental Regulation........................................5
         14.3 Taxes..........................................................5
         14.4 Headings.......................................................5
         14.5 No Third Party Beneficiaries...................................5
         14.6 Expenses: Indemnification......................................5
         14.7 Severability of Provisions.....................................5
         14.8 Nonliability of the Lenders....................................5
         14.9 Choice of Law..................................................5
         14.10 Consent to Jurisdiction.......................................5
         14.11 Waiver of Jury Trial..........................................5
         14.12 Successors and Assigns........................................5
         14.13 Entire Agreement; Modification of Agreement...................5
         14.14 Dealings with the Borrower....................................5
         14.16 Counterparts..................................................5
         14.17 Discretion....................................................5

ARTICLE XV  NOTICES..........................................................5
         15.1 Giving Notice..................................................5
         15.2 Change of Address..............................................5





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                      UNSECURED REVOLVING CREDIT AGREEMENT


     THIS UNSECURED  REVOLVING CREDIT AGREEMENT is entered into as of January 6,
1998, by and among the following:

     GREAT LAKES REIT, L.P., a Delaware limited partnership having its principal
place of business at 823 Commerce  Drive,  Suite 300, Oak Brook,  Illinois 60521
("Borrower"),  the sole  general  partner of which is Great Lakes REIT,  Inc., a
Maryland corporation;

     BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION ("BOFA"), a national
banking  association  organized  under the laws of the United States of America,
having its  principal  place of business at 231 South LaSalle  Street,  Chicago,
Illinois 60697;

     THE FIRST  NATIONAL  BANK OF CHICAGO  ("First  Chicago"),  a national  bank
organized  under the laws of the United States of America,  having its principal
place of business at One First National Plaza, Chicago, Illinois 60670;

     First Chicago, as documentation agent ("Documentation Agent");

     BOFA,  as  administrative  agent (the  "Agent") for the Lenders (as defined
below).

                                                     RECITALS

     A.           Borrower is primarily engaged in the business of acquiring,
developing, owning and operating suburban office and light industrial
properties.

     B. The Borrower has requested that the Lenders make loans  available to the
Borrower in the maximum  aggregate  principal amount of $35,000,000  outstanding
from time to time pursuant to the terms of this Agreement (the "Facility"),  and
that the  Administrative  Agent act as administrative  agent for the Lenders and
that the  Documentation  Agent act as documentation  agent for the Lenders.  The
Agent and the Lenders have agreed to do so.

     NOW,  THEREFORE,  in  consideration  of the mutual covenants and agreements
herein contained, the parties hereto agree as follows:

                                                     ARTICLE I

                                         DEFINITIONS AND ACCOUNTING TERMS

         1.1      Definitions. As used in this Agreement, the following terms
have the respective meanings set forth below:

     "Adjusted Base Rate" means a floating  interest rate equal to the Base Rate
changing when and as the Base Rate changes.

     "Adjusted EBITDA" means, for any quarter, the sum of (i) EBITDA (calculated
by  annualizing  actual EBITDA for such quarter),  reduced by a capital  reserve
equal to the product of $1.25 and the  aggregate  amount of Leased  Space at the
Projects  for such period,  plus (ii) EBITDA for any  Projects  acquired or sold
during such quarter  (calculated on an annualized  basis),  reduced by a capital
reserve


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equal to the product of $1.25 and the weighted average amount of Leased Space at
the Projects during such quarter.

     "Adjusted  LIBOR  Rate"  means,  with  respect to a LIBOR  Advance  for the
relevant  LIBOR  Interest  Period,  the sum of (i) the quotient of (a) the LIBOR
Rate  applicable  to such LIBOR  Interest  Period,  divided by (b) one minus the
Reserve  Requirement  (expressed as a decimal) applicable to such LIBOR Interest
Period, plus (ii) one and one tenths percent (1.10%).

     "Administrative  Agent" means BOFA, acting as administrative  agent for the
Lenders in connection with the transactions  contemplated by this Agreement, and
its successors in such capacity.

     "Advance"  means a Loan  to the  Borrower  hereunder  by one or more of the
Lenders pursuant to Section 2.l(a) hereof, including the initial Advance and all
subsequent  Advances,  whether such Advances  are, from time to time,  Base Rate
Advances or LIBOR Advances.

     "Affiliate" means any Person directly or indirectly controlling, controlled
by or under direct or indirect  common  control with any other Person.  A Person
shall be deemed to control  another  Person if the  controlling  Person owns ten
percent (10%) or more of any class of voting securities of the controlled Person
or possesses, directly or indirectly, the power to direct or cause the direction
of  the  management  or  policies  of the  controlled  Person,  whether  through
ownership of stock, by contract or otherwise.

     "Aggregate  Commitment"  means,  as of  any  date,  the  sum  of all of the
Lenders' then-current Commitments,  provided that the Aggregate Commitment shall
not at any time exceed an amount equal to the lesser of (i) $35,000,000 and (ii)
the maximum amount that permits compliance with Article VII hereof.

     "Agreement"  means  this  Unsecured  Revolving  Credit  Agreement  and  all
amendments, modifications and supplements hereto.

     "Agreement  Execution  Date" shall mean January 6, 1998,  the date on which
all of the parties hereto have executed and delivered this Agreement.

     "Allocated Facility Amount" means, at any time, the sum of all then
outstanding Advances.

     "Applicable Laws" is defined in Section 6.26(b) hereof.

     "Base Rate" means a rate per annum equal to the rate of interest  announced
by BOFA  from  time to time as its  reference  rate,  changing  when and as such
reference rate changes.

     "Base Rate  Advance"  means an Advance that bears  interest at the Adjusted
Base Rate.

     "BOFA" means Bank of America National Trust and Savings Association.

     "Borrower"  means Great  Lakes  REIT,  L.P.,  together  with its  permitted
successors and assigns.

     "Borrowing Date" means a Business Day on which an Advance is made to the
Borrower.

     "Borrowing Notice" is defined in Section 2.10(a) hereof.


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     "Business  Day" means a day, other than a Saturday,  Sunday or holiday,  on
which banks are open for business in Chicago,  Illinois and,  where such term is
used in reference to the selection or  determination of the Adjusted LIBOR Rate,
in London, England.

     "Capital  Stock"  means any and all shares,  interests,  participations  or
other equivalents  (however  designated) of capital stock of a corporation,  any
and all  equivalent  equity  ownership  interests  in a  Person  which  is not a
corporation  and  any  and  all  warrants  or  options  to  purchase  any of the
foregoing.

     "Cash  Equivalents"  shall  mean (i)  short-term  obligations  of, or fully
guaranteed by, the United States of America,  (ii) commercial paper rated A-1 or
better by S&P's or P-1 or better  by  Moody's,  (iii)  certificates  of  deposit
issued by and time deposits with commercial banks (whether  domestic or foreign)
having  capital  and  surplus in excess of  $100,000,000,  or (iv) shares of any
money market mutual fund rated at least AAA or the equivalent by S&P or at least
Aaa or the equivalent by Moody's.

      "Code"  means the  Internal  Revenue  Code of 1986 as amended from time to
time, or any replacement or successor statute,  and the regulations  promulgated
thereunder from time to time.

     "Commitment" means the obligation of each Lender,  subject to the terms and
conditions  of this  Agreement  and in  reliance  upon the  representations  and
warranties  herein,  to make  Advances not exceeding in the aggregate the amount
set forth opposite its signature  below,  or the amount stated in any subsequent
amendment hereto.

     "Consolidated  Operating  Partnership"  means  the  Borrower,  the  General
Partner  and any other  subsidiary  partnerships  or  entities of either of them
which are  required  under GAAP to be  consolidated  with the  Borrower  and the
General Partner for financial reporting purposes.

     "Consolidated Secured Debt" means, as of any date of determination, (i) the
aggregate  principal amount of all  Indebtedness of the  Consolidated  Operating
Partnership, plus the allocable percentage of all Indebtedness of any Investment
Affiliate,  whether recourse or non-recourse,  equal to the applicable  economic
interest in such  Investment  Affiliate  held by any entity in the  Consolidated
Operating Partnership, all of which Indebtedness is outstanding at such date and
secured by a Lien on any asset or Capital Stock,  including  without  limitation
loans secured by  mortgages,  stock,  or  partnership  interests,  plus (ii) the
aggregate principal amount of all Indebtedness of any Investment Affiliate which
Indebtedness  is outstanding at such date and not secured by a Lien or any asset
or Capital  Stock but only to the extent same is recourse to the Borrower or any
other entity in the Consolidated Operating Partnership.

     "Consolidated  Net  Worth"  means,  as of any  date of  determination,  the
stockholders'  equity as shown on the balance sheet of the General Partner as of
that date.

     "Consolidated Total  Indebtedness"  means, as of any date of determination,
(i) all Indebtedness of the Consolidated  Operating  Partnership  outstanding at
such date,  determined in accordance with GAAP, after  eliminating  intercompany
items, plus (ii) the allocable  percentage of any Indebtedness of any Investment
Affiliate outstanding at such date, equal to the applicable economic interest in
such  Investment  Affiliate  held by any  entity in the  Consolidated  Operating
Partnership, in the aggregate, without duplication.



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     "Consolidated  Unsecured Debt" means, as of any date of determination,  the
aggregate  principal amount of all  Indebtedness of the  Consolidated  Operating
Partnership, plus the allocable percentage of all Indebtedness of any Investment
Affiliate equal to the applicable economic interest in such Investment Affiliate
held by any  entity  in the  Consolidated  Operating  Partnership,  all of which
Indebtedness  is  outstanding  at such date,  but excluding  that portion of the
Consolidated Secured Debt described under clause (i) of such definition.

     "Controlled  Group" means all members of a controlled group of corporations
and all trades or businesses  (whether or not incorporated) under common control
which,  together with all or any of the entities in the  Consolidated  Operating
Partnership, are treated as a single employer under Sections 414(b) or 414(c) of
the Code.

     "Credit Parties" means, collectively, Borrower and each Guarantor.

     "Debt Service" means for any period,  (a) Interest  Expense for such period
plus (b) the  aggregate  amount of  regularly  scheduled  principal  payments of
Indebtedness  (excluding optional prepayments and balloon principal payments due
on  maturity  in respect of any  Indebtedness)  required  to be made during such
period by the Borrower, or any entity in the Consolidated  Operating Partnership
(and, if such period is less than a full fiscal year,  annualized by calculating
all of the payments  required to be made during the entire  fiscal year in which
such  period  falls),  plus (c) a  percentage  of all such  regularly  scheduled
principal  payments  required to be made  during  such period by any  Investment
Affiliate on Indebtedness  (excluding optional prepayments and balloon principal
payments due on maturity in respect of any  Indebtedness)  taken into account in
calculating  Interest Expense,  equal to the allocable economic interest in such
Investment  Affiliate  held by the Borrower  and any entity in the  Consolidated
Operating  Partnership,  in the  aggregate,  without  duplication  (and, if such
period is less than a full fiscal year,  annualized  by  calculating  all of the
payments  required to be made during the entire fiscal year in which such period
falls), plus (d) Senior Preferred Stock Expense for such period.

     "Default" means an event which, with notice or lapse of time or both, would
become an Event of Default.

     "Default  Rate"  means  with  respect to any  Advance,  a rate equal to the
interest rate applicable to such Advance plus three percent (3%) per annum.

     "Defaulting  Lender" means any Lender which fails or refuses to perform its
obligations   under  this  Agreement   within  the  time  period  specified  for
performance  of such  obligation,  or, if no time  frame is  specified,  if such
failure or refusal  continues  for a period of five  Business Days after written
notice from the  Administrative  Agent;  provided that if such Lender cures such
failure or refusal, such Lender shall cease to be a Defaulting Lender.

     "Documentation  Agent" means First Chicago,  acting as documentation  agent
for the  Lenders  in  connection  with  the  transactions  contemplated  by this
Agreement, and its successors in such capacity.

              "Dollars" and "$" mean United States Dollars.

     "EBITDA" means, as to any period,  net income,  adjusted by excluding gains
and losses from property sales,  debt  restructurings  and property  write-downs
(and reduced to eliminate any income from Investment Affiliates), as reported by
the Consolidated Operating Partnership in accordance


<PAGE>




with GAAP, plus Interest Expense, depreciation,  amortization and income tax (if
any) expense plus a percentage of such income  (adjusted as described  above) of
any  Investment  Affiliate  equal to the  allocable  economic  interest  in such
Investment   Affiliate  held  by  any  entity  in  the  Consolidated   Operating
Partnership,  in the aggregate (provided that no item of income or expense shall
be included more than once in such calculation even if it falls within more than
one of the  foregoing  categories).  For purposes of this  definition,  items of
income and  expense  from any  Properties  acquired or sold during the period in
question shall be excluded.

     "Effective  Date" means each  Borrowing  Date and, if no Borrowing Date has
occurred  in the  preceding  calendar  month,  the  first  Business  Day of each
calendar month.

     "Eligible  Joint  Ventures"  means  those joint  ventures  (i) in which any
entity in the  Consolidated  Operating  Partnership  either is the  managing  or
co-managing  general  partner or equivalent,  or has an equity interest equal or
greater than fifty percent (50%), and (ii) in which such entity has the ability,
in its sole discretion,  to sell, encumber or otherwise transfer any interest in
the assets of such joint venture,  and (iii) for which no restrictions  exist on
the upstreaming of Net Operating Income,  and (iv) which have agreed to maintain
no Indebtedness.

     "Eligible  Land" means any Land for which all  permits and other  approvals
required  of  any  applicable   governmental  authority  or  otherwise  for  the
development thereof have been received.

     "Environmental  Laws" means any and all Federal,  state, local or municipal
laws,  rules,  orders,  regulations,   statutes,   ordinances,  codes,  decrees,
requirements  of  any  governmental   authority  having  jurisdiction  over  the
Borrower, its Subsidiaries or Investment Affiliates, or their respective assets,
and  regulating  or  imposing  liability  or  standards  of  conduct  concerning
protection  of  human  health  or the  environment,  as  now or may at any  time
hereafter be in effect,  in each case to the extent the foregoing are applicable
to the operations of the Borrower,  any Investment Affiliate,  or any Subsidiary
or any of their respective Properties or other Assets.

     "ERISA"  means the Employee  Retirement  Income  Security  Act of 1974,  as
amended, and regulations promulgated thereunder from time to time.

     "Event of Default" means any event set forth in Article X hereof.

     "Existing  Facility"  means that certain  existing  credit  facility in the
maximum  principal  amount of $75,000,000  from Bank of Boston and certain other
lenders to Borrower, as same may be amended or supplemented from time to time.

     "Facility" means the unsecured revolving credit facility described in
Section 2.1.

     "Facility Fee" and "Facility Fee Rate" are defined in Section 2.7(b).

     "Federal  Funds  Effective  Rate" means,  for any day, an interest rate per
annum 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  for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York,  or, if such rate is not so  published  for any day which is a
Business Day, the average of the quotations at  approximately  10 a.m.  (Chicago
time) on such day on such transactions received by the Administrative Agent from
three   Federal  funds   brokers  of   recognized   standing   selected  by  the
Administrative Agent in its sole discretion.


<PAGE>





     "Fixed Charges" means, for any quarter, the sum of dividends payable on any
preferred  stock of the General  Partner  and any  Subsidiary  of the  Borrower,
calculated on an annualized basis, and Debt Service.

     "Funded  Percentage"  means,  with  respect  to any  Lender at any time,  a
percentage  equal to a  fraction  the  numerator  of which is the  amount of the
Aggregate  Commitment  actually  disbursed and  outstanding  to Borrower by such
Lender at such time,  and the  denominator  of which is the total  amount of the
Aggregate Commitment disbursed and outstanding to Borrower by all of the Lenders
at such time.

     "Funds  From  Operations"  shall mean GAAP net  income of the  Consolidated
Operating  Partnership,  plus a percentage of GAAP net income of any  Investment
Affiliate equal to the allocable economic interest in such Investment  Affiliate
held by any entity in the Consolidated Operating Partnership,  in the aggregate,
all of which  income  shall be adjusted by (i)  excluding  gains and losses from
property sales, debt  restructurings  and property  write-downs and adjusted for
the non-cash effect of  straight-lining of rents, (ii)  straight-lining  various
ordinary  operating  expenses  which are payable  less  frequently  than monthly
(e.g., real estate taxes) and (iii) adding back  depreciation,  amortization and
all non-cash items. In calculating Funds From Operations,  no deduction shall be
made from net income for closing  costs and other  one-time  charges  associated
with the formation and capitalization of such Person.

     "GAAP" means generally accepted accounting  principles in the United States
of America  consistent  with those  utilized in preparing the audited  financial
statements  of the Borrower  required  hereunder and applied  consistently  from
period to period.

     "General  Partner"  means Great Lakes REIT,  Inc.,  a Maryland  corporation
whose common stock is listed on the New York Stock  Exchange and is qualified as
a real estate investment  trust.  General Partner is the sole general partner of
Borrower;

     "Gross Asset Value" means,  for any Person for any quarter,  the sum of (i)
total  unrestricted cash and Cash  Equivalents,  provided that in no event shall
the amounts be added to Gross Asset Value in violation of the  restrictions  set
forth in Section  8.3  hereof,  plus (ii) Real Estate  Asset  Value,  plus (iii)
Eligible Land, valued at the lesser of cost or market value, provided that in no
event shall the  aggregate  amount  added to Gross Asset Value  pursuant to this
clause  (iii) exceed ten percent  (10%) of the Gross Asset  Value,  plus (iv) an
amount  equal to fifty  percent  (50%) of the cost of all 50%  Preleased  Assets
Under  Development  and  one  hundred  percent  (100%)  of the  cost  of all 75%
Preleased Assets Under Development,  provided,  however,  that in no event shall
the  aggregate  amount  added to Gross Asset Value  pursuant to this clause (iv)
exceed fifteen percent (15%) of the Gross Asset Value, and further provided that
the  aggregate  amount added to Gross Asset Value  pursuant to clauses (iii) and
(iv) shall in no event exceed $50,000,000.

     "Gross Revenues" means total revenues, calculated in accordance with GAAP.

     "Guarantee Obligation" means as to any Person (the "guaranteeing  person"),
any obligation  (determined without  duplication) of the guaranteeing person (or
any other Person [including,  without  limitation,  any bank under any letter of
credit] if the guaranteeing person has issued a reimbursement, counter indemnity
or similar  obligation in favor of such other Person)  guaranteeing or in effect
guaranteeing  any  Indebtedness,  leases,  dividends or other  obligations  (the
"primary  obligations") of any other third Person (the "primary obligor") in any
manner, whether directly or


<PAGE>




indirectly,  including,  without limitation,  any obligation of the guaranteeing
person,  whether or not contingent,  (i) to purchase any such primary obligation
or any  property  constituting  direct or indirect  security  therefor,  (ii) to
advance or supply  funds (1) for the  purchase  or  payment of any such  primary
obligation or (2) to maintain  working  capital or equity capital of the primary
obligor or  otherwise  to  maintain  the net worth or  solvency  of the  primary
obligor,  (iii) to purchase  property,  securities or services primarily for the
purpose of assuring the owner of any such primary  obligation  of the ability of
the primary obligor to make payment of such primary obligation or (iv) otherwise
to assure or hold harmless the owner of any such primary obligation against loss
in respect thereof; provided,  however, that the term Guarantee Obligation shall
not  include  endorsements  of  instruments  for  deposit or  collection  in the
ordinary  course of  business.  The amount of any  Guarantee  Obligation  of any
guaranteeing  person  shall be deemed  to be the  maximum  stated  amount of the
primary  obligation  relating to such  Guarantee  Obligation  (or, if less,  the
maximum stated  liability set forth in the  instrument  embodying such Guarantee
Obligation),  provided,  that in the absence of any such stated amount or stated
liability,  the amount of such Guarantee  Obligation shall be such  guaranteeing
person's  maximum  reasonably   anticipated  liability  in  respect  thereof  as
reasonably   determined   by  the  Borrower  in  good  faith,   subject  to  the
Administrative  Agent's  approval,  which  approval  shall  not be  unreasonably
withheld.

     "Guarantor"  means,  collectively,  the General  Partner,  each  Subsidiary
listed on Schedule 1 attached  hereto,  and each other Person that  executes and
delivers the Guaranty.

     "Guaranty"  means the Guaranty  executed and delivered in the form attached
hereto as Exhibit A.

     "Hedging  Agreements"  means interest rate protection  agreements,  foreign
currency exchange  agreements,  commodity purchase or option agreements or other
interest, exchange rate or commodity price hedging agreements.

         "Indebtedness" of any Person at any date means without  duplication (i)
all indebtedness of such Person for borrowed money, (ii) all obligations of such
Person for the  deferred  purchase  price of property  or  services  (other than
current trade  liabilities  and other  accounts  payable,  and accrued  expenses
incurred in the  ordinary  course of business  and  payable in  accordance  with
customary practices), to the extent such obligations constitute indebtedness for
the  purposes of GAAP,  (iii) any other  indebtedness  of such  Person  which is
evidenced by a note, bond, debenture or similar instrument, (iv) all obligations
of such Person under financing leases and capital leases, (v) all obligations of
such Person in respect of acceptances  issued or created for the account of such
Person,  (vi)  all  Guarantee  Obligations  of  such  Person  (excluding  in any
calculation of consolidated indebtedness of the Borrower,  Guarantee Obligations
of the Borrower in respect of primary obligations of any Subsidiary),  (vii) all
reimbursement  obligations  of such  Person  for  letters  of  credit  and other
contingent  liabilities,  (viii) all liabilities secured by any Lien (other than
Liens for taxes not yet due and  payable) on any  property  owned by such Person
even  though  such Person has not  assumed or  otherwise  become  liable for the
payment thereof,  (ix) any repurchase  obligation or liability of such Person or
any of its  Subsidiaries  with respect to accounts or notes  receivable  sold by
such Person or any of its  Subsidiaries,  (x) Senior Preferred Stock,  (xi) such
Person's allocable percentage of debt of any Investment  Affiliates equal to the
greater of (a) the percentages of the principal amount of such debt(s) for which
such  Person  is  liable  and  (b)  the  applicable  economic  interest  in such
Investment  Affiliate(s)  held by  such  Person,  in the  aggregate,  (xii)  all
obligations to make advances and  contributions  to Investment  Affiliates,  and
(xiii) to the extent not included in Interest  Expense all  obligations  to make
payments under any Hedging Agreements.



<PAGE>




     "Insolvency"  means  insolvency as defined in the United States  Bankruptcy
Code, as amended. "Insolvent" when used with respect to a Person, shall refer to
a Person who satisfies the definition of Insolvency.

     "Interest  Expense"  means,  for  any  period,  the sum  (calculated  on an
annualized  basis) of (i) all  interest  expense of the  Consolidated  Operating
Partnership  determined in accordance with GAAP, plus (ii) capitalized  interest
not  covered  by an  interest  reserve  from a loan  facility,  plus  (iii)  the
allocable  portion (based on liability) of any accrued or paid interest incurred
on any obligation for which any entity in the Consolidated Operating Partnership
is wholly or partially  liable under  repayment,  interest carry, or performance
guarantees, or other relevant liabilities, plus (iv) the allocable percentage of
any accrued or paid  interest  incurred on any  Indebtedness  of any  Investment
Affiliate,  whether recourse or non-recourse,  equal to the applicable  economic
interest in such  Investment  Affiliate  held by any entity in the  Consolidated
Operating  Partnership,  in the  aggregate,  provided  that no expense  shall be
included  more than once in such  calculation  even if it falls within more than
one of the foregoing categories.

         "Interest Period" means a LIBOR Interest Period.

     "Investment  Affiliate"  means  any  Person  in  which  any  entity  in the
Consolidated  Operating  Partnership,  directly or indirectly,  has an ownership
interest but which is not a member of the Consolidated Operating Partnership.

     "Land"  means any  parcel of real  property  wholly-owned  in fee simple of
record by any entity in the Consolidated Operating Partnership or any Investment
Affiliate  (provided,  however,  that any such parcel of an Investment Affiliate
shall be included only to the extent of the allocable  economic interest in such
Investment   Affiliate  held  by  any  entity  in  the  Consolidated   Operating
Partnership, in the aggregate), which parcel is not improved.

     "Leased Space" means, as of any date of  determination,  the total rentable
area, then leased,  subleased,  licensed or otherwise occupied under any written
agreement at market rates  (determined as of the time such agreement was entered
into), in all of the Projects.

     "Lenders" means,  collectively,  BOFA and the other Persons  executing this
Agreement  in such  capacity,  or any Person  which  subsequently  executes  and
delivers any  amendment  hereto in such  capacity  and each of their  respective
permitted  successors and assigns.  Where  reference is made to "the Lenders" in
any Loan Document it shall be read to mean "all of the Lenders"

     "Lending  Installation"  means any U.S. office of any Lender  authorized to
make loans similar to the Advances described herein.

     "LIBOR  Advance" means an Advance that bears interest at the Adjusted LIBOR
Rate.

     "LIBOR Interest Period" means, with respect to a LIBOR Advance, a period of
30, 60, 90 or 180 days (to the extent that periods in excess of three months are
generally available from the Lenders), as selected in advance by the Borrower.

     "LIBOR Rate" means,  with respect to a LIBOR Advance for the relevant LIBOR
Interest Period,  the per annum rate of interest,  rounded upward, if necessary,
to the nearest 1/16th of one percent (0.0625%), determined by the Administrative
Agent to be the rate at which  deposits in immediately  available  funds in U.S.
Dollars would be offered by BOFA's London branch to first-class banks in


<PAGE>




the London interbank  eurodollar market at approximately  11:00 a.m. London time
two Business Days prior to the first day of such LIBOR Interest  Period,  in the
approximate  amount  of  the  relevant  LIBOR  Advance  and  having  a  maturity
approximately equal to such LIBOR Interest Period.

     "Lien" means any  mortgage,  pledge,  hypothecation,  deposit  arrangement,
preference,  priority,  security interest,  collateral assignment,  statutory or
consensual  lien,  charge,  restriction or  encumbrance of any kind  (including,
without  limitation,  any conditional sale or other title retention agreement or
lease in the  nature  thereof,  any  filing  or  agreement  to file a  financing
statement as debtor under the Uniform  Commercial Code on any property leased to
any Person  under a lease  which is not in the nature of a  conditional  sale or
title retention  agreement,  or any subordination  agreement in favor of another
Person).  For  purposes of this  Agreement,  a Lien on the Capital  Stock of any
Person shall be deemed to constitute a Lien on the assets of said Person.

     "Loan"  means,  with  respect  to a Lender,  such  Lender's  portion of any
Advance.

     "Loan Documents" means this Agreement,  the Notes, the Guaranty and any and
all  other  agreements  or  instruments  required  and/or  provided  to  Lenders
hereunder or  thereunder,  as any of the  foregoing  may be amended from time to
time.

     "Majority  Lenders" means Lenders in the aggregate  having in excess of 50%
of the Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders  in the  aggregate  holding  in  excess of 50% of the  aggregate  unpaid
principal amount of the outstanding Advances.

     "Margin Stock" has the meaning  ascribed to it in Regulation U of the Board
of Governors of the Federal Reserve System.

      "Material  Adverse  Effect" means,  with respect to any matter,  that such
matter  constitutes a Material  Adverse  Financial  Change or (x) materially and
adversely affects the business,  properties,  condition or results of operations
of the Consolidated Operating Partnership taken as a whole, or (y) constitutes a
nonfrivolous  challenge  to the  validity  or  enforceability  of  any  material
provision of any Loan Document against any obligor party thereto.

     "Material  Adverse  Financial Change" shall be deemed to have occurred if a
material  adverse  financial  change has  occurred  which  could  reasonably  be
expected to materially impair  Borrower's or any Guarantor's  ability to perform
its obligations under any of the Loan Documents.

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

     "Maturity  Date"  means  July 6,  1998 or such  earlier  date on which  the
principal  balance of the Facility and all other sums due in connection with the
Facility shall be due as a result of the acceleration of the Facility.

     "Monetary  Default" means any Default involving  Borrower's  failure to pay
any of the Obligations when due.

     "Moody's" means Moody's Investors Service, Inc. and its successors.



<PAGE>




     "Net Operating  Income" means, as to any Property for any fiscal period, an
amount equal to (a) rents and other  revenues  received in the  ordinary  course
from such Property  (including  proceeds of rent loss  insurance),  less (b) all
expenses paid or accrued  related to the ownership,  operation or maintenance of
such  Property,   excluding  capital   expenditures,   but  including,   without
limitation,  taxes,  assessments  and the like,  insurance,  utilities,  payroll
costs,  maintenance,  repair and landscaping expenses,  management fees, leasing
commissions and on-site marketing expenses.

     "Non-Use Fee" is defined in Section 2.7 hereof.

     "Note" means the promissory note payable to the order of each Lender in the
amount  of such  Lender's  maximum  Commitment  in the form  attached  hereto as
Exhibit B (collectively, the "Notes").

     "Obligations"  means the  Advances  and all accrued and unpaid fees and all
other obligations of Borrower to the  Administrative  Agent or any or all of the
Lenders arising under this Agreement or any of the other Loan Documents.

     "Partial Advance" is defined in Section 2.3 hereof.

     "Participants" is defined in Section 13.2.1 hereof.

     "PBGC"  means  the  Pension  Benefit  Guaranty  Corporation  or any  entity
succeeding to any or all of its functions under ERISA.

     "Percentage" means, with respect to each Lender, the applicable  percentage
of  the  then-current   Aggregate   Commitment   represented  by  such  Lender's
then-current Commitment.

     "Permitted Liens" are defined in Section 9.6 hereof.

     "Person"  means  an  individual,  a  corporation,   a  limited  or  general
partnership,   an   association,   a  joint  venture  or  any  other  entity  or
organization,  including a governmental or political  subdivision or an agent or
instrumentality thereof.

     "Plan" means an employee  benefit plan as defined in Section 3(3) of ERISA,
whether  or not  terminated,  as to which  the  Borrower  or any  member  of the
Controlled Group may have any liability.

     "Preleased Assets Under Development" means as of any date of determination,
any Project which (i) is under  construction  and then treated as an asset under
development  under GAAP,  and (ii) has, as of such date,  at least fifty percent
(50%) of its projected total rentable area leased at market rates to third party
tenants  similar to those at  Borrower's  other  properties,  both such land and
improvements  under  construction to be valued for purposes of this Agreement at
then-current  book value,  as  determined  in  accordance  with GAAP;  provided,
however,  in no event  shall  Preleased  Assets  Under  Development  include any
Project  after  the date on  which a  certificate  of  occupancy  or  comparable
authorization  has been issued for such Project by the  applicable  governmental
authority.  Preleased Assets Under Development shall be comprised of two groups:
"75% Preleased Assets Under  Development"  which shall mean,  collectively,  any
Preleased  Assets Under  Development that has, as of such date, at least seventy
five percent (75%) of its  projected  total  rentable  area so leased;  and "50%
Preleased  Assets  Under  Development"  which  shall  mean,  collectively,   any
Preleased Asset Under  Development  that has, as of such date, less than seventy
five


<PAGE>




percent (75%) but at least fifty percent (50%) of its projected  total  rentable
area so leased.

     "Project"  means any parcel of real property  wholly-owned in fee simple of
record by any entity in the Consolidated Operating Partnership or any Investment
Affiliate  (provided,  however,  that any such parcel of an Investment Affiliate
shall be included only to the extent of the allocable  economic interest in such
Investment   Affiliate  held  by  any  entity  in  the  Consolidated   Operating
Partnership, in the aggregate), together with all improvements thereon, which is
fully  improved for use and operated as a office or light  industrial  property,
and with respect to which a certificate of occupancy or comparable authorization
has been issued by the applicable governmental authority.

     "Property" means each parcel of real property wholly-owned in fee simple of
record by any entity in the Consolidated Operating Partnership or any Investment
Affiliate,  together with all improvements,  if any, thereon, provided, however,
that any such parcel of an  Investment  Affiliate  shall be included only to the
extent of the allocable  economic interest in such Investment  Affiliate held by
any entity in the Consolidated Operating Partnership, in the aggregate.

     "Purchasers" is defined in Section 13.3.1 hereof.

     "Qualified  Officer" means, with respect to any entity, the chief financial
officer,  chief  accounting  officer  or  controller  of such  entity if it is a
corporation or of such entity's  general  partner if it is a partnership or such
other appropriate individual approved by the Bank.

     "Rate Option" means the Adjusted Base Rate or the Adjusted  LIBOR Rate. The
Rate Option in effect on any date shall  always be the Adjusted  Corporate  Base
Rate unless the Borrower has properly  selected the Adjusted LIBOR Rate pursuant
to Section 2.10 hereof.

     "Real Estate Asset Value" means, for any Person for any quarter, the sum of
(i) the quotient of (x) EBITDA for such Person during such quarter (which EBITDA
shall be calculated  by  annualizing  actual EBITDA for such quarter,  but shall
exclude EBITDA,  if any,  attributable to Preleased  Assets Under  Development),
divided  by (y) a  capitalization  rate  equal to  10.25%,  plus  (ii) the gross
acquisition  cost paid for any  Property  acquired  during  such  quarter,  less
customary  brokerage  fees and other  closing  costs  incurred by such Person in
connection with such acquisition.

     "Regulation D" means  Regulation D of the Board of Governors of the Federal
Reserve  System  as from  time to time in  effect  and any  successor  or  other
regulation  or official  interpretation  of said Board of Governors  relating to
reserve requirements applicable to member banks of the Federal Reserve System.

      "Reportable  Event" means a reportable event as defined in Section 4043 of
ERISA and the  regulations  issued under such  section,  with respect to a Plan,
excluding,  however,  such events as to which the PBGC by regulation  waived the
requirement  of Section  4043(a) of ERISA that it be notified  within 30 days of
the  occurrence  of such  event,  provided  that a failure  to meet the  minimum
funding standard of Section 412 of the Code and of Section 302 of ERISA shall be
a Reportable  Event regardless of the issuance of any such waivers in accordance
with either Section 4043(a) of ERISA or Section 412(d) of the Code.

     "Reserve  Requirement"  means, with respect to a LIBOR Interest Period, the
maximum  aggregate  reserve  requirement  (including  all  basic,  supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.



<PAGE>




     "S&P" means Standard & Poor's Ratings Group and its successors.

     "Senior  Preferred  Stock"  means the stated value of any  preferred  stock
issued by the General  Partner which is not typical  preferred stock but instead
is both (i)  redeemable  by the  holders  thereof  on any fixed date or upon the
occurrence  of any event and (ii) as to  payment  of  dividends  or  amounts  on
liquidation,  either  guaranteed  by any direct or  indirect  Subsidiary  of the
General  Partner or secured by any property of the General Partner or any direct
or indirect Subsidiary of the General Partner.

     "Senior Preferred Stock Expense" means, for any period for any Person,  the
aggregate dividend payments due to the holders of Senior Preferred Stock of such
Person,  whether  payable in cash or in kind,  and whether or not actually  paid
during such period,  in each case on an annualized basis (if such period is less
than a full fiscal year).

     "Solvent"  means,  as to any Person on a particular  date, that such Person
(a) has capital  sufficient to carry on its existing  business and  transactions
and all  business  and  transactions  in which it is about to  engage,  (b) owns
property  having a value,  both at fair  valuation  and at present  fair salable
value,  greater  than  the  amount  required  to pay  its  probable  liabilities
(including,  without  limitation,  contingencies),  (c)  does not  intend  to or
believe  that it will incur debts or  liabilities  beyond its ability to pay the
same as they mature and (d) is not Insolvent.

     "Subordinated  Debt"  means  Indebtedness  of  the  Consolidated  Operating
Partnership is  contractually  subordinated in right of payment and otherwise to
the Indebtedness  under the Loan Documents,  on terms acceptable to the Majority
Lenders.

     "Subsidiary"  means as to any Person,  a corporation,  partnership 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,  partnership  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 provided such  corporation,  partnership or other entity is
consolidated with such Person for financial reporting purposes under GAAP.

     "Transferee" is defined in Section 13.4 hereof.

     "Unencumbered  Asset"  means  those  Properties  held by any  entity in the
Consolidated  Operating  Partnership or any Eligible Joint Venture which,  as of
any date of determination,  (a) is not subject to any Liens other than Permitted
Liens  (excluding Liens described in Schedule 9.6 attached  hereto),  (b) is not
subject  to  any  agreement  (including  any  agreement  governing  Indebtedness
incurred in order to finance or refinance the  acquisition  of such asset) which
prohibits  or limits the  ability of any  entity in the  Consolidated  Operating
Partnership  or Eligible Joint  Venture,  as the case may be, to create,  incur,
assume or suffer to exist  any Lien  upon any  assets or  Capital  Stock of such
entity in the Consolidated  Operating Partnership or Eligible Joint Venture, (c)
is not subject to any agreement (including any agreement governing  Indebtedness
incurred in order to finance or refinance the  acquisition  of such asset) which
(i) entitles any Person to the benefit of any Lien (other than  Permitted  Liens
excluding  Liens  described in Schedule  9.6  attached  hereto) on any assets or
Capital  Stock  of any  entity  in the  Consolidated  Operating  Partnership  or
Eligible  Joint  Venture or (ii) would  entitle any Person to the benefit of any
Lien (other than  Permitted  Liens  excluding  Liens  described  in Schedule 9.6
attached hereto) on such assets or Capital Stock upon the occurrence of


<PAGE>




any  contingency  (including,  without  limitation,  pursuant  to an "equal  and
ratable"    clause),    (d)   is   not    the    subject    of   any    material
architectural/engineering  issue or any  material  Environmental  Law issue,  as
evidenced by a certification of Borrower, and (e) is in material compliance with
the applicable representations and warranties in Article VI below; provided that
any Property which would, as of the date of determination,  individually account
for more than fifteen percent (15%) of the Value of Unencumbered Assets shall be
excluded  herefrom.  Notwithstanding  anything to the contrary contained in this
Agreement,  if the Administrative Agent reasonably  determines that any Property
theretofore  identified by Borrower as an Unencumbered  Asset may be the subject
of a material  architectural/engineering  issue or a material  Environmental Law
issue,  the  Administrative  Agent may (i) require Borrower to furnish a current
detailed environmental assessment or  architectural/engineering  assessment,  as
the case may be, and, if applicable, a written estimate of any remediation costs
from  a  qualified   architect,   engineer  or  contractor   acceptable  to  the
Administrative  Agent, in which event Borrower shall promptly obtain and furnish
the  same at its own  expense,  and (ii)  exclude  any  such  Property  from the
Unencumbered  Asset  at  its  election.   No  Property  of  any  entity  in  the
Consolidated  Operating  Partnership or any Investment Affiliate shall be deemed
to be  unencumbered  unless both such  Property  and all  Capital  Stock of such
entity or Investment  Affiliate,  as the case may be, is  unencumbered  and such
entity  (and any other  intervening  Subsidiary  between the  Borrower  and such
entity) or Investment  Affiliate,  as the case may be, has no  Indebtedness  for
borrowed  money  (other  than  Indebtedness  due  to  the  Borrower).  As of the
Agreement  Execution  Date,  the  parties  hereto  agree that  those  Properties
described on Schedule 2 attached hereto shall constitute all of the Unencumbered
Assets as of such date.

     "Unencumbered  NOI" means,  for any period,  Net  Operating  Income for all
Unencumbered Assets during such period.

     "Value of  Unencumbered  Assets" means,  as of any date, the sum of (i) the
quotient of (a) the Unencumbered  NOI for the immediately  preceding full fiscal
quarter from each Property  which is an  Unencumbered  Asset as of such date (as
such  Unencumbered NOI is annualized),  divided by (b) a capitalization  rate of
10.25%,  plus (ii) the gross  acquisition  cost paid for any Property that is an
Unencumbered Asset and is acquired during such quarter, less customary brokerage
fees and other closing costs incurred by the Consolidated  Operating Partnership
in connection with such acquisition;  provided,  however, that in no event shall
the  aggregate  amount added to the Value of  Unencumbered  Assets on account of
Eligible  Joint Ventures  exceed ten percent (10%) of the Value of  Unencumbered
Assets.  For  purposes  of  this  definition,  Net  Operating  Income  from  any
Unencumbered  Assets  acquired or sold  during the period in  question  shall be
excluded.

     The foregoing  definitions shall be equally applicable to both the singular
and the plural forms of the defined terms.

         1.2 Financial  Standards.  All financial and accounting  terms used and
not otherwise  defined  herein shall be construed in accordance  with GAAP.  All
financial and accounting  computations and  determinations  required of a Person
under this Agreement shall be made, and all financial information required under
this Agreement shall be prepared,  in accordance with GAAP,  except as otherwise
expressly provided herein.



<PAGE>




                                   ARTICLE II

                                  THE FACILITY

         2.1      The Facility.

                  (a) Subject to the terms and  conditions of this Agreement and
in reliance  upon the  representations  and  warranties  of  Borrower  contained
herein,  Lenders  agree to make  Advances  through the  Administrative  Agent to
Borrower from time to time prior to the Maturity Date,  provided that the making
of any such Advance will not cause the then Allocated  Facility Amount to exceed
the  then-current  Aggregate  Commitment.  The Advances may be ratable Base Rate
Advances or ratable LIBOR Advances.  Except as provided in Section 12.16 hereof,
each Lender shall be required to fund only its  Percentage  of each such Advance
and no Lender will be required to fund any amounts  which when  aggregated  with
such Lender's  Percentage of all other  Advances then  outstanding  would exceed
such Lender's then-current Commitment. This facility ("Facility") is a revolving
credit facility and,  subject to the provisions of this Agreement,  Borrower may
request  Advances  hereunder,  repay such Advances and reborrow  Advances at any
time prior to the Maturity Date.

                  (b)  The  Facility   created  by  this  Agreement,   and  that
Commitment  of each Lender to lend  hereunder,  shall  terminate on the Maturity
Date, unless sooner terminated in accordance with the terms of this Agreement.

     (c) In no event shall the Aggregate  Commitment  exceed Thirty Five Million
Dollars ($35,000,000).

     2.2  Principal  Payments.  Any  outstanding  Advances  and all other unpaid
Obligations shall be paid in full by the Borrower on the Maturity Date.

         2.3  Requests  for  Advances:   Responsibility  for  Advances.  Ratable
Advances  funded  by  the  Lenders  shall  be  made  available  to  Borrower  by
Administrative  Agent in  accordance  with  Section  2.1(a) and Section  2.10(a)
hereof.  The  obligation  of each Lender to fund its  Percentage of each ratable
Advance shall be several, and not joint or joint and several.

         2.4  Evidence  of  Credit  Extensions.  The  Advances  of  each  Lender
outstanding  at any time shall be evidenced by the Notes.  Each Note executed by
the  Borrower  shall be in a maximum  principal  amount  equal to each  Lender's
Percentage of the Aggregate  Commitment.  Each Lender shall record  Advances and
principal  payments  thereof  on the  schedule  attached  to its Note or, at its
option,  in its records,  and each Lender's  record  thereof shall be conclusive
absent Borrower furnishing to such Lender conclusive and irrefutable evidence of
an  error  made  by  such  Lender  with  respect  to  that   Lender's   records.
Notwithstanding  the  foregoing,  the failure to make, or an error in making,  a
notation  with respect to any Advance  shall not limit or  otherwise  affect the
obligations of Borrower  hereunder or under the Notes to pay the amount actually
owed by Borrower to Lenders.

         2.5 Ratable Loans.  Each Advance  hereunder shall consist of Loans made
from the several Lenders ratably in proportion to their Percentages. The ratable
Advances may be Base Rate  Advances,  LIBOR  Advances or a  combination  thereof
selected by the Borrower in accordance with Sections 2.9 and 2.10.

         2.6      Unused Commitment Fee. The Borrower agrees to pay to the
Administrative Agent


<PAGE>




for the account of each Lender a commitment  fee (the  "Non-Use  Fee"),  payable
quarterly  in  arrears  on the  first  day of each  calendar  quarter  hereafter
beginning  on January 1, 1998,  calculated  for each  calendar  quarter from the
Agreement  Execution  Date to and including  the Maturity  Date, on the weighted
average  during such quarter of the daily  unborrowed  portion of such  Lender's
Commitment  (which  is  equal  to  the  difference  between  (a)  such  Lender's
Commitment on such day and (b) the then outstanding  Loans owed to such Lender).
If such weighted  average is less than or equal to 33% of such Lender's  portion
of the  Aggregate  Commitment,  the  Non-Use  Fee  for  such  quarter  shall  be
calculated  at the rate of 0.15% per  annum of such  average.  If such  weighted
average is greater  than 33% but not more than 66% of such  Lender's  portion of
the Aggregate  Commitment,  the Non-Use Fee for such quarter shall be calculated
at the increased  rate of 0.20% per annum on such average,  and if such weighted
average  is  greater  than  66%  of  such  Lender's  portion  of  the  Aggregate
Commitment,  the  Non-Use  Fee for  such  quarter  shall  be  calculated  at the
increased  rate  of  0.25%  per  annum  on  such  average.  Notwithstanding  the
foregoing,  all Non-Use Fees shall be  calculated  and payable on the  effective
date  of any  termination  of the  obligations  of the  Lenders  to  make  Loans
hereunder with respect to any partial calendar quarter. The Non-Use Fee shall be
calculated for actual days elapsed on the basis of a 360-day year. [For purposes
of  illustration  only and not in  limitation of the  foregoing:  If, during the
entire month of April,  1998, the unborrowed  portion of the Loan is 70%, and on
May 1 through May 20, such unborrowed  portion is 50% and on May 21 through June
30, such  unborrowed  portion is 30%, then the quarterly  Non-Use Fee payable on
July 1,  1998  would  be  calculated  as  follows:  [.0025  x  (30)360)  x (.7 x
$35,000,000)]  + [.0020 x (20)360) x (.5 x  $35,000,000)]  + [.0015 x (41)360) x
(.3 x $35,000,000)] = $8,842.35.

         2.7      Other Fees.

                  (a)  The   Borrower   shall  pay  all  fees   payable  to  the
Administrative  Agent  pursuant  to the  Borrower's  letter  agreement  with the
Administrative Agent and Documentation Agent.

                  (b) The Borrower shall pay to the Administrative Agent for the
account of the Lenders (i) a one-time  arrangement  fee ("Facility  Fee") in the
amount of  $17,500,  to be shared  among the Lenders  based on their  respective
Percentages;  and (ii) a  one-time  agency fee  ("Agency  Fee") in the amount of
$5,000 to be retained in full by  Administrative  Agent.  The  Facility  Fee and
Agency Fee shall each be paid by Borrower on the Agreement Execution Date.

         2.8 Minimum Amount of Each Advance.  Each LIBOR Advance shall be in the
minimum  amount  of  $1,000,000  (and in  multiples  of  $100,000  if in  excess
thereof),  and each Base Rate Advance shall be in the minimum amount of $250,000
(and in multiples of $100,000 if in excess thereof), provided, however, that any
Base Rate Advance may be in the amount of the unused Aggregate Commitment.

         2.9      Interest.

                  (a) The  outstanding  principal  balance under the Notes shall
bear interest from time to time at a rate per annum equal to:

                           (i)      the Adjusted Base Rate; or

                           (ii)     at the election of Borrower with respect to
all or portions of the Obligations, the Adjusted LIBOR Rate.


<PAGE>




                  (b) All interest  shall be calculated  for actual days elapsed
on the  basis of a 360 day  year.  Interest  accrued  on each  Advance  shall be
payable in arrears on the first day of each calendar month,  commencing with the
first such date to occur after the date hereof, and the Maturity Date.  Interest
shall not be payable for the day of any payment on the amount paid if payment is
received by Administrative Agent prior to noon (Chicago time). If any payment of
principal  or interest  under the Notes shall  become due on a day that is not a
Business  Day, such payment  shall be made on the next  succeeding  Business Day
and,  in the case of a payment of  principal,  such  extension  of time shall be
included in computing interest due in connection with such payment.

         2.10     Selection of Rate Options and LIBOR Interest Periods.

                  (a)  Borrower,  from time to time,  may select the Rate Option
and, in the case of each LIBOR Advance,  the commencement date (which shall be a
Business  Day) and the length of the LIBOR  Interest  Period  applicable to each
LIBOR Advance.  Borrower shall give  Administrative  Agent irrevocable notice (a
"Borrowing  Notice") not later than 11:00 a.m.  (Chicago  time) (i) at least one
Business Day prior to a Base Rate Advance,  and (ii) at least three (3) Business
Days prior to a ratable LIBOR Advance, specifying:

                       (i)          the Borrowing Date, which shall be a
                  Business Day, of such Advance,

                       (ii)         the aggregate amount of such Advance,

                       (iii)        the type of Advance selected, and

                       (iv)         in the case of each LIBOR Advance, the LIBOR
                  Interest Period applicable thereto.

         The Borrower shall also deliver together with each Borrowing Notice the
compliance  certificate  required in Section  5.2, if  required,  and  otherwise
comply with the conditions set forth in Section 5.2 for Advances. Administrative
Agent shall use  reasonable  efforts to provide each Lender by facsimile  with a
copy of each Borrowing  Notice and  compliance  certificate on the same Business
Day it is received.

         Not later than noon (Chicago time) on each Borrowing  Date, each Lender
shall  make  available  its Loan or Loans,  in funds  immediately  available  in
Chicago to the Administrative Agent. Administrative Agent will promptly make the
funds so received from the Lenders available to the Borrower.

                  (b)  Administrative  Agent shall, as soon as practicable after
receipt of a Borrowing Notice requesting a LIBOR Advance, determine the Adjusted
LIBOR Rate applicable to the requested ratable LIBOR Advance and inform Borrower
and  Lenders  of the same.  Each  determination  of the  Adjusted  LIBOR Rate by
Administrative  Agent  shall be  conclusive  and  binding  upon  Borrower in the
absence of manifest error.

                  (c) If Borrower shall prepay a LIBOR Advance other than on the
last day of the LIBOR  Interest  Period  applicable  thereto,  Borrower shall be
responsible to pay all amounts due to Lenders as required by Section 4.4 hereof.

                  (d) As of the end of each LIBOR Interest Period selected for a
ratable  LIBOR  Advance,  the interest rate on the LIBOR Advance will become the
Adjusted Base Rate, unless


<PAGE>




Borrower has once again selected a LIBOR Interest  Period in accordance with the
timing and procedures set forth in Section 2.10(g).

                  (e) The right of  Borrower to select the  Adjusted  LIBOR Rate
for an Advance  pursuant to this  Agreement  is subject to the  availability  to
Lenders  of a  similar  option.  If  Administrative  Agent  determines  that (i)
deposits of Dollars in an amount  approximately  equal to the LIBOR  Advance for
which the Borrower  wishes to select the Adjusted  LIBOR Rate are not  generally
available at such time in the London interbank  eurodollar  market,  or (ii) the
rate at which the deposits  described in subsection (i) herein are being offered
will not  adequately  and fairly  reflect the costs to Lenders of maintaining an
Adjusted LIBOR Rate on an Advance or of funding the same in such market for such
LIBOR Interest Period, or (iii) reasonable means do not exist for determining an
Adjusted  LIBOR Rate, or (iv) the Adjusted  LIBOR Rate would be in excess of the
maximum interest rate which Borrower may by law pay, then in any of such events,
Administrative Agent shall so notify Borrower and Lenders and such Advance shall
bear interest at the Adjusted Base Rate.

                  (f) In no event may  Borrower  elect a LIBOR  Interest  Period
which would extend beyond the Maturity  Date. In no event may Borrower have more
than five (5) different LIBOR Interest Periods for LIBOR Advances outstanding at
any one time.

                  (g)      Conversion and Continuation.

                           (i) Borrower may elect from time to time,  subject to
                  the other  provisions  of this Section 2.10, to convert all or
                  any part of a ratable  Advance into any other type of Advance;
                  provided that any  conversion of a ratable LIBOR Advance shall
                  be made on,  and only on,  the last day of the LIBOR  Interest
                  Period applicable thereto.

                           (ii) Base Rate Advances  shall  continue as Base Rate
                  Advances   unless  and  until  such  Base  Rate  Advances  are
                  converted   into  ratable   LIBOR   Advances   pursuant  to  a
                  Conversion/Continuation  Notice from  Borrower  in  accordance
                  with  Section   2.10(g)(iv).   Ratable  LIBOR  Advances  shall
                  continue until the end of the then  applicable  LIBOR Interest
                  Period  therefor,  at which  time each such  Advance  shall be
                  automatically  converted  into a Base Rate Advance  unless the
                  Borrower   shall  have  given  the   Administrative   Agent  a
                  Conversion/Continuation  Notice  in  accordance  with  Section
                  2.10(g)(iv) requesting that, at the end of such LIBOR Interest
                  Period,  such  Advance  either  continue as an Advance of such
                  type for an additional  LIBOR  Interest  Period of the same or
                  different duration.

                           (iii)   Notwithstanding   anything  to  the  contrary
                  contained in this Section 2, no Advance may be converted  into
                  a LIBOR  Advance or  continued  (following  the end of a LIBOR
                  Interest  Period) as a LIBOR Advance when any Monetary Default
                  or Event of Default has occurred and is continuing.

                           (iv) The Borrower shall give the Administrative Agent
                  irrevocable  notice (a  "Conversion/Continuation  Notice")  of
                  each  conversion  of an  Advance  or  continuation  of a LIBOR
                  Advance  not  later  than  11:00  a.m.  (Chicago  time) on the
                  Business Day  immediately  preceding the date of the requested
                  conversion,  in the  case  of a  conversion  into a Base  Rate
                  Advance,  or 11:00  a.m.  (Chicago  time) at least  three  (3)
                  Business Days prior to the date of the requested conversion or
                  continuation,


<PAGE>




                  in the case of a conversion  into or continuation of a ratable
                  LIBOR Advance, specifying: (1) the requested date (which shall
                  be a Business Day) of such conversion or continuation; (2) the
                  amount and type of the Advance to be converted  or  continued;
                  and (3) the amounts and type(s) of Advance(s)  into which such
                  Advance is to be converted or continued  and, in the case of a
                  conversion  into or  continuation  of a ratable LIBOR Advance,
                  the duration of the LIBOR Interest Period applicable thereto.

         2.11 Method of Payment. All payments of the Obligations hereunder shall
be made,  without  set-off,  deduction,  or  counterclaim,  by wire  transfer to
Administrative Agent's account designated in writing from time to time by notice
to Borrower or, in the absence of such notice,  to  Administrative  Agent at its
address  specified  herein,  or at any other Lending  Installation  specified in
writing by  Administrative  Agent to Borrower,  by noon (local time) on the date
when due and shall be applied ratably by Administrative Agent among the Lenders,
except as otherwise  provided herein.  Each payment  delivered to Administrative
Agent  for  the  account  of  any  Lender   shall  be   delivered   promptly  by
Administrative   Agent  to  such   Lender  in  the  same  type  of  funds   that
Administrative  Agent received at its address specified herein or at any Lending
Installation  specified in a notice received by  Administrative  Agent from such
Lender.  Administrative  Agent is hereby  authorized  to charge any  accounts of
Borrower  maintained with BOFA for each payment of principal,  interest and fees
as it becomes due hereunder.

         2.12 Default.  Notwithstanding the foregoing, during the continuance of
a  Monetary  Default,  any other  material  Default,  or any  Event of  Default,
Borrower shall not have the right to request a LIBOR Advance, continue or select
a new LIBOR Interest Period for an existing ratable LIBOR Advance or convert any
Base Rate  Advance  to a ratable  LIBOR  Advance.  During the  continuance  of a
Monetary  Default  or any Event of  Default,  outstanding  Advances  shall  bear
interest at the applicable Default Rates until such Monetary Default or Event of
Default ceases to exist or the Obligations are paid in full.

         2.13  Lending  Installations.  Each  Lender  may book its  Loans at any
Lending  Installation  selected  by such  Lender  and  may  change  its  Lending
Installation  from time to time. All terms of this Agreement  shall apply to any
such Lending  Installation and the Notes shall be deemed held by each Lender for
the benefit of such Lending Installation.  Each Lender may, by written notice to
the Administrative Agent and Borrower,  designate a Lending Installation through
which Loans will be made by it and for whose account payments are to be made.

         2.14 Non-Receipt of Funds by Administrative Agent. Unless Borrower or a
Lender, as the case may be, has notified  Administrative Agent prior to the date
on which it is scheduled to make payment to  Administrative  Agent of (i) in the
case of a Lender,  an  Advance,  or (ii) in the case of  Borrower,  a payment of
principal,  interest or fees to the Administrative  Agent for the account of the
Administrative  Agent or any or all of the  Lenders,  that it does not intend to
make such payment (which notice shall not affect the  obligations of Borrower or
any Lender, as the case may be, hereunder), and such notice has been received by
Administrative Agent,  Administrative Agent may assume that such payment will be
made when due. Administrative Agent may, but shall not be obligated to, make the
amount of such payment available to the intended recipient in reliance upon such
assumption. If such Lender or Borrower, as the case may be, has not in fact made
such payment to  Administrative  Agent,  the recipient of such payment shall, on
demand by Administrative Agent, repay to Administrative Agent the amount so made
available  together  with  interest  thereon  in  respect of each day during the
period   commencing   on  the  date  such  amount  was  so  made   available  by
Administrative Agent until the date Administrative Agent recovers such amount at
a


<PAGE>




rate per annum  equal to (i) in the case of  payment  by a Lender,  the  Federal
Funds  Effective  Rate (as determined by  Administrative  Agent) for such day or
(ii) in the case of payment by Borrower,  the interest  rate  applicable  to the
relevant Advance.

     2.15  Application of Moneys  Received.  All moneys collected or received by
the  Administrative  Agent on account of the  Facility  directly or  indirectly,
shall be applied in the following order of priority:

     (i) to the  payment  of all  expenses  then  due and  payable  by  Borrower
hereunder,  including,  without limitation,  costs incurred in the collection of
such moneys;

     (ii) to the reimbursement of any yield protection due to any of the Lenders
in accordance with Section 4.1;

     (iii) to the payment of all indemnity  obligations  then due and payable by
Borrower hereunder;
     (iv) to payment of all fees then due to the Administrative Agent;

     (v) to the payment of any Non-Use Fee and Facility Fee, if then due, and to
the payment of all fees due hereunder;

     (vi) first to  interest  until paid in full and then to  principal  for all
Lenders  (other than  Defaulting  Lenders),  in accordance  with the  respective
Funded Percentages of the Lenders;

     (vii) any other sums due to the  Administrative  Agent or any Lender  under
any of the Loan Documents; and

     (viii) to the  payment of any sums due to each  Defaulting  Lender as their
respective Percentages appear (provided that Administrative Agent shall have the
right to set-off against such sums any amounts due from such Defaulting Lender).

         2.16 Voluntary Reduction of Aggregate  Commitment Amount. Upon at least
five (5) days prior  irrevocable  written notice (or telephone  notice  promptly
confirmed  in  writing) to the  Administrative  Agent,  Borrower  shall have the
right,  without  premium or penalty,  to terminate the  Aggregate  Commitment in
whole or in part  provided  that  (a)  Borrower  may not  reduce  the  Aggregate
Commitment  below the Allocated  Facility  Amount at the time of such  requested
reduction,  and  (b)  any  such  partial  termination  shall  be in the  minimum
aggregate  amount  of  Five  Million  Dollars  ($5,000,000.00)  or any  integral
multiple of Five Million Dollars  ($5,000,000.00) in excess thereof. Any partial
termination  of the  Aggregate  Commitment  shall  be  applied  pro rata to each
Lender's Commitment.



<PAGE>




                                   ARTICLE III

                              INTENTIONALLY DELETED

                                   ARTICLE IV

                             CHANGE IN CIRCUMSTANCES

     4.1  Yield  Protection.  If the  adoption  of or  change  in any law or any
governmental  or  quasi-governmental  rule,  regulation,  policy,  guideline  or
directive  (whether  or not  having  the  force of law),  or any  interpretation
thereof, or the compliance of any Lender therewith,

                           (i)  subjects  any Lender or any  applicable  Lending
                  Installation  to any tax,  duty,  charge or  withholding on or
                  from payments due from Borrower  (excluding  federal and state
                  taxation of the overall net income of any Lender or applicable
                  Lending  Installation),  or changes the basis of such taxation
                  of  payments  to any  Lender in  respect of its Loans or other
                  amounts due it hereunder, or

                           (ii)  imposes or increases  or deems  applicable  any
                  reserve,  assessment,  insurance  charge,  special  deposit or
                  similar  requirement  against assets of,  deposits with or for
                  the  account  of, or credit  extended  by,  any  Lender or any
                  applicable  Lending   Installation   (including  reserves  and
                  assessments relating to LIBOR Advances), or

                           (iii) imposes any other condition,  and the result is
                  to increase the cost of any Lender or any  applicable  Lending
                  Installation  of  making,  funding  or  maintaining  Loans  or
                  reduces any amount  receivable by any Lender or any applicable
                  Lending Installation in connection with Loans, or requires any
                  Lender  or any  applicable  Lending  Installation  to make any
                  payment  calculated  by reference to the amount of Loans held,
                  or interest  received by it, by an amount  deemed  material by
                  such Lender,


then,  within fifteen (15) days after written  demand by such Lender  describing
the basis for such demand,  Borrower  shall pay such Lender that portion of such
increased  expense incurred or reduction in an amount received which such Lender
determines is attributable to making,  funding and maintaining its Loans and its
Commitment.


         4.2 Changes in Capital Adequacy Regulations. If a Lender determines the
amount of capital  required or expected to be  maintained  by such  Lender,  any
Lending  Installation of such Lender or any corporate  entity  controlling  such
Lender is increased  as a result of a Change (as defined  below),  then,  within
fifteen (15) days after written  demand by such Lender,  Borrower shall pay such
Lender the amount  necessary  to  compensate  for any  shortfall  in the rate of
return on the portion of such increased  capital which such Lender determines is
attributable  to this  Agreement,  its Loans,  or its  obligation  to make Loans
hereunder  (after  taking  into  account  such  Lender's  policies as to capital
adequacy). "Change" means (i) any change after the date of this Agreement in the
Risk-Based  Capital  Guidelines  (as defined  below) or (ii) any  adoption of or
change in any other law,  governmental or quasi-governmental  rule,  regulation,
policy, guideline, interpretation, or directive (whether or not having the force
of law) after the date of this  Agreement  which  affects  the amount of capital
required or expected to be maintained by any Lender or any Lending Installation


<PAGE>




or any corporation controlling any Lender. "Risk-Based Capital Guidelines" means
(i) the risk-based capital guidelines in effect in the United States on the date
of this  Agreement,  including  transition  rules,  and (ii)  the  corresponding
capital  regulations  promulgated by regulatory  authorities  outside the United
States  implementing  the July 1988  report of the Basle  Committee  on  Banking
Regulation and  Supervisory  Practices  Entitled  "International  Convergence of
Capital Measurements and Capital Standards", including transition rules, and any
amendments  to such  regulations  adopted  prior to the date of this  Agreement.
Without in any way  affecting  the  Borrower's  obligation  to pay  compensation
actually claimed by a Lender under this Section 4.2, the Borrower shall have the
right to  replace  any  Lender  which  has  demanded  such  compensation  with a
replacement Lender acceptable to Administrative Agent;  provided,  however, that
no Monetary  Default,  other material Default or any Event of Default shall then
exist,  and that  Borrower  notifies  such Lender that it has elected to replace
such  Lender  and  notifies  such  Lender  and the  Administrative  Agent of the
identity of the proposed  replacement Lender not more than sixty (60) days after
the date of such Lender's most recent demand for compensation under this Section
4.2. The Lender being  replaced  shall assign its  Percentage  of the  Aggregate
Commitment and its rights and obligations under this Facility to the replacement
Lender in  accordance  with the  requirements  of  Section  13.3  hereof and the
replacement Lender shall assume such Percentage of the Aggregate  Commitment and
the related  obligations  under this  Facility,  all  pursuant to an  assignment
agreement  substantially  in the form of Exhibit H hereto.  The  purchase by the
replacement Lender shall be at par (plus all accrued and unpaid interest and any
other sums owed to such Lender being replaced  hereunder) which shall be paid to
the Lender being replaced upon the execution and delivery of the assignment.

         4.3  Availability  of LIBOR  Advances.  If any Lender  determines  that
maintenance of any of its Loans bearing interest at the Adjusted LIBOR Rate at a
suitable Lending Installation would violate any applicable law, rule, regulation
or  directive  of  any   Governmental   Authority   having   jurisdiction,   the
Administrative   Agent  shall   suspend  by  written   notice  to  Borrower  the
availability  of outstanding  LIBOR Advances and require any  outstanding  LIBOR
Advances to be repaid. If the Majority Lenders determine that deposits of a type
or maturity  appropriate  to match fund LIBOR  Advances are not  available,  the
Administrative   Agent  shall   suspend  by  written   notice  to  Borrower  the
availability   of  LIBOR   Advances   from  and  after  the  date  of  any  such
determination.   If  the  Majority  Lenders  determine  that  an  interest  rate
applicable to a LIBOR Advance does not  accurately  reflect the cost of making a
LIBOR Advance,  and, if for any reason  whatsoever the provisions of Section 4.1
are inapplicable,  the  Administrative  Agent shall suspend by written notice to
Borrower the  availability of LIBOR Advances from and after the date of any such
determination.

         4.4 Funding  Indemnification.  If any payment of a LIBOR Advance occurs
on a date  which is not the  last  day of the  LIBOR  Interest  Period,  whether
because of acceleration, prepayment or otherwise, or a LIBOR Advance is not made
on the date  specified  by Borrower  for any reason other than default by one or
more of the Lenders,  Borrower will indemnify and hold harmless each Lender from
and against any loss, damage,  expense or cost incurred by such Lender resulting
therefrom,  including,  without limitation, any loss, damage, expense or cost in
liquidating  or  employing  deposits  acquired  to fund or  maintain  the  LIBOR
Advance.

         4.5 Lender Statements;  Survival of Indemnity. To the extent reasonably
possible,  each Lender shall designate an alternate  Lending  Installation  with
respect to its LIBOR Advances to reduce any liability of Borrower to such Lender
under Sections 4.1 and 4.2 or to avoid the unavailability of a LIBOR Advance, so
long as such  designation  is not  disadvantageous  to such Lender.  Each Lender
shall  deliver a written  statement of such Lender as to the amount due, if any,
under Sections 4.1, 4.2 or 4.4 hereof. Such written statement shall set forth in
reasonable detail the calculations upon which such Lender determined such amount
and shall be final, conclusive and


<PAGE>




binding on Borrower in the absence of manifest error.  Determination  of amounts
payable  under  such  Sections  in  connection  with a LIBOR  Advance  shall  be
calculated as though each Lender  funded its LIBOR Advance  through the purchase
of a deposit of the type and  maturity  corresponding  to the deposit  used as a
reference in  determining  the Adjusted  LIBOR Rate  applicable to such Advance,
whether in fact that is the case or not. Unless otherwise  provided herein,  the
amount  specified  in the  written  statement  shall be payable on demand  after
receipt by Borrower of the written statement.  The obligations of Borrower under
Sections 4.1, 4.2 and 4.4 hereof shall survive  payment of the  Obligations  and
termination of this Agreement.

                                    ARTICLE V

                              CONDITIONS PRECEDENT

         5.1 Conditions  Precedent to Closing. The Lenders shall not be required
to make the initial  Advance  hereunder  unless (i) the Borrower shall have paid
all fees  then due and  payable  to the  Lenders  and the  Administrative  Agent
hereunder,  (ii) all of the  conditions  set forth in Section 5.2 are satisfied,
and (iii) the Borrower shall have furnished to the Administrative Agent, in form
and substance  satisfactory to the Lenders and their counsel and with sufficient
copies for the Lenders, the following:

                  (a) Certificates of Limited Partnership/Incorporation.  A copy
of the  Certificate  of Limited  Partnership  for the Borrower and a copy of the
articles of incorporation or other applicable  organizational  documents of each
of General Partner and the other  Guarantors,  each certified by the appropriate
Secretary of State or equivalent state official.

                  (b)  Agreements of Limited  Partnership/Bylaws.  A copy of the
Agreement  of Limited  Partnership  for the  Borrower  and a copy of the bylaws,
partnership  agreement,   operating  agreement  or  other  applicable  governing
instrument of each of the General  Partner and the other  Guarantors,  including
all amendments  thereto,  each  certified by the Secretary or other  appropriate
officer  of the  Person in  question  as being in full  force and  effect on the
Agreement Execution Date.

                  (c)  Good  Standing  Certificates.   A  certified  copy  of  a
certificate  from the  Secretary of State or  equivalent  state  official of the
states where each of the Borrower,  General Partner and each other Guarantor are
organized,  dated as of the  most  recent  practicable  date,  showing  the good
standing or partnership  qualification (if issued) of each of Borrower,  General
Partner and each other Guarantor.

                  (d) Foreign Qualification Certificates.  A certified copy of a
certificate  from the  Secretary of State or  equivalent  state  official of the
state  where each of the  Borrower,  General  Partner  and the other  Guarantors
maintain  its  principal  place  of  business,  dated  as  of  the  most  recent
practicable  date,  showing the qualification to transact business in such state
as a  foreign  entity,  for each of  Borrower,  General  Partner  and the  other
Guarantors.

                  (e) Resolutions. A copy of a resolution or resolutions adopted
by the Board of  Directors  or other  applicable  governing  body of each of the
General  Partner and the other  Guarantors,  certified by the Secretary or other
appropriate  officer of the Person in question as being in full force and effect
on the  Agreement  Execution  Date,  authorizing  the  execution,  delivery  and
performance  of the Loan  Documents  to which  such  Person  is a party  and the
consummation of the transactions provided for therein.



<PAGE>




                  (f)  Incumbency  Certificate.  A  certificate  for each of the
General  Partner  and the other  Guarantors,  signed by the  Secretary  or other
appropriate  officer of the Person in question and dated the Agreement Execution
Date, as to the incumbency, and containing the specimen signature or signatures,
of the  Persons  authorized  to execute and  deliver  the Loan  Documents  to be
executed and delivered by such entity.

     (g) Loan Documents.  Originals of the Loan Documents (in such quantities as
the Lenders may reasonably request), duly executed by authorized officers of the
appropriate entity.

                  (h) Opinion of Borrower's  Counsel.  A written opinion,  dated
the  Agreement  Execution  Date,  from outside  counsel for the  Borrower  which
counsel is reasonably satisfactory to Administrative Agent, substantially in the
form attached hereto as Exhibit C.

                  (i) Opinion of Guarantor's  Counsel. A written opinion,  dated
the Agreement  Execution  Date,  from outside  counsel for the Guarantors  which
counsel is reasonably satisfactory to Administrative Agent, substantially in the
form attached hereto as Exhibit D.

     (j) Compliance Certificate.  An original compliance certificate in the form
attached hereto as Exhibit F, duly executed by a Qualified Officer of Borrower.

     (k) Financial and Related Information. The following information:

                           (i) A certificate,  signed by an executive officer of
                  the Borrower,  stating that on the Agreement Execution Date no
                  Default or Event of Default has occurred and is continuing and
                  that  all  representations  and  warranties  of  the  Borrower
                  contained  herein  are true and  correct  as of the  Agreement
                  Execution Date as and to the extent set forth herein;

                           (ii)  The  most   recent   consolidated   annual  and
                  quarterly   financial   statements   of  the  Borrower  and  a
                  certificate  from a Qualified  Officer of the Borrower that no
                  change in the Borrower's financial condition that could have a
                  Material Adverse Effect has occurred since September 30, 1997;

                           (iii)  Evidence  of  sufficient  Unencumbered  Assets
                  [which  evidence may include  pay-off  letters  (together with
                  evidence  of  payment  or a  direction  of  Borrower  to use a
                  portion  of  the  proceeds  of  the  Advances  to  repay  such
                  Indebtedness),  mortgage  releases  and/or title  policies] to
                  assist the Administrative  Agent in determining the Borrower's
                  compliance  with the  covenants  set forth in Article  VII and
                  Article IX herein;

                           (iv)  Written   money   transfer   instructions,   in
                  substantially  the form of Exhibit E hereto,  addressed to the
                  Administrative  Agent and  signed by a  Qualified  Officer  of
                  Borrower,  together  with such other  related  money  transfer
                  authorizations as the Administrative Agent may have reasonably
                  requested; and

                           (v) Operating  statements for the Unencumbered Assets
                  and  other  evidence  of income  and  expenses  to assist  the
                  Administrative Agent in determining Borrower's compliance with
                  the covenants set forth in Articles VII, VIII and IX herein.



<PAGE>




                  (l) Other  Evidence  as any  Lender  May  Require.  Such other
documents and evidence as the Administrative Agent and any Lender may reasonably
request to fully  effectuate and establish the  consummation of the transactions
contemplated  hereby,  the taking of all necessary actions in any proceedings in
connection  herewith  and  compliance  with  the  conditions  set  forth in this
Agreement.

         5.2  Conditions  Precedent to Subsequent  Advances.  Advances after the
initial  Advance  shall be made from time to time as requested by Borrower,  and
the  obligation of each Lender to make any Loan for any such Advance are subject
to the following terms and conditions:

                  (a) prior to and at the time of each such Advance or issuance,
no Default or Event of Default shall have occurred and be continuing  under this
Agreement or any of the Loan Documents and, if required by Administrative Agent,
Borrower shall deliver a certificate of Borrower to such effect; and

                  (b) The representations and warranties contained in Article VI
are true and  correct as of such  Borrowing  Date or date of  conversion  and/or
continuation  as and to the extent set forth  therein,  except to the extent any
such  representation  or warranty is stated to relate solely to an earlier date,
in which case such  representation  or warranty shall be true and correct on and
as of such earlier date.

                  (c)  As to  each  Subsidiary  that  executes  and  delivers  a
Guaranty after the Agreement  Execution Date (or that is required to do so), the
Borrower  has  delivered  to the  Administrative  Agent the items  described  in
subsections (a) through (g) of Section 5.1 hereof.

         Each  Borrowing   Notice  and   Conversion/Continuation   Notice  shall
constitute a  representation  and warranty by the Borrower  that the  conditions
contained in Sections 5.2(a) through (c) have been satisfied.



<PAGE>




                                   ARTICLE VI

                         REPRESENTATIONS AND WARRANTIES

         Borrower hereby represents and warrants that:

         6.1 Existence. Attached hereto as Schedule 6.1 (as updated from time to
time in  accordance  with this  Agreement) is a table  showing,  for each Credit
Party,  its  organizational  form  (e.g.,  corporation,   partnership,   limited
liability company,  etc.),  state of organization,  state in which its principal
place of  business is located,  owner(s)  of its  Capital  Stock and  percentage
ownership  interest.  Each Credit Party is an entity of the type  indicated  for
such Credit Party on Schedule 6.1 (as updated from time to time) duly  organized
and  validly  existing  under  the  laws of the  state  of its  organization  as
indicated  on Schedule 6.1 (as updated  from time to time),  with its  principal
place of business in the state  indicated  for such Credit Party on Schedule 6.1
(as  updated  from time to time),  and is duly  qualified  as a foreign  entity,
properly  licensed  (if  required),  in good  standing  and  has  all  requisite
authority  to conduct  its  business in each  jurisdiction  in which it owns any
Property  and,  except  where the failure to be so  qualified  or to obtain such
authority would not have a Material Adverse Effect,  in each other  jurisdiction
in which the nature of its business or activities requires such qualification or
authority.  Each  Subsidiary  of each Credit  Party is duly  organized,  validly
existing and in good standing under the laws of its jurisdiction of organization
and has all requisite  authority to conduct its business in each jurisdiction in
which it owns any  Property,  and except where the failure to be so qualified or
to obtain such authority would not have a Material Adverse Effect, in each other
jurisdiction  in which the nature of its business or  activities  requires  such
qualification.

         6.2   Corporate/Partnership   Powers.   The  execution,   delivery  and
performance of the Loan Documents  required to be delivered by each Credit Party
hereunder are within the authority of such entity and the powers of the Borrower
under its partnership  agent have been duly authorized by all requisite  action,
and are not in conflict with the terms of any organizational instruments of such
entity,  or any instrument or agreement to which such Credit Party is a party or
by which  such  Credit  Party or any of its  respective  assets  may be bound or
affected.

         6.3 Power of Officers.  The officers of each Credit Party executing the
Loan  Documents  required to be  delivered  by such  entities or by the Borrower
hereunder  have been duly  elected or  appointed  and were fully  authorized  to
execute the same at the time each such agreement,  certificate or instrument was
executed.

         6.4 Government and Other Approvals. No approval,  consent, exemption or
other  action by, or notice to or filing  with,  any  governmental  authority is
necessary in connection  with the  execution,  delivery or performance of any of
the Loan Documents by any of the Credit Parties. No other consent to or approval
of the transactions  contemplated  hereunder is required from any ground lessor,
mortgagee,  beneficiary under a deed of trust or any other Person, except as has
been delivered to the Lenders on or before the Agreement Execution Date.

         6.5  Solvency.  Immediately  after  the  Agreement  Execution  Date and
immediately  following the making of each Advance and after giving effect to the
application of the proceeds of such Advance,  each of the Credit Parties will be
Solvent.

     6.6 Compliance  With Laws and Agreements.  There is no judgment,  decree or
order or any law,  rule or  regulation  of any court or  governmental  authority
binding on any of the Credit


<PAGE>




Parties or any of their respective assets which would be violated or contravened
by the  execution,  delivery or performance  of the Loan  Documents.  The Credit
Parties  and their  respective  Property  and other  assets  are in  substantial
compliance  with  applicable  laws, and with all material  leases,  licenses and
other  agreements  to which any Credit  Party is a party or by which such Credit
Party or any of its assets is bound.  No other party to any such lease,  license
or other agreement is in default thereunder in any material respect.

         6.7  Enforceability of Agreement.  This Agreement and each of the other
Loan Documents is (or, when fully  executed and  delivered,  will be) the legal,
valid and binding  agreement of each of the Credit Parties thereto,  enforceable
against each such Credit Party in accordance with its respective  terms,  except
to the extent that such  enforcement  may be limited by  applicable  bankruptcy,
insolvency,  reorganization  or other  similar  laws  affecting  the  rights  of
creditors generally.

         6.8 Title to  Property.  Borrower  or its  Subsidiaries  has fee simple
title (subject only to Permitted  Liens) to the Property and assets reflected in
Borrower's  consolidated  financial  statements  most recently  delivered to the
Administrative  Agent as owned by it or any such  Subsidiary,  free and clear of
Liens  except for the  Permitted  Liens.  Neither the  execution,  delivery  nor
performance of the Loan Documents  required by the Credit Parties will result in
the  creation  of any Lien on the  Property  or such  assets.  Borrower  and its
Subsidiaries  either own, or have entered into valid leases,  licenses and other
agreements for, all assets, services and facilities necessary for the conduct of
their respective businesses and the operation of their respective assets.

         6.9 Litigation.  There are no suits, arbitrations,  claims, disputes or
other  proceedings   (including,   without  limitation,   any  civil,  criminal,
administrative  or  environmental  proceedings),  pending  or,  to the  best  of
Borrower's  knowledge  after due inquiry,  threatened  against or affecting  the
Borrower,  any of the other Credit  Parties or any of the Property,  the adverse
determination  of which  individually  or in the aggregate  could  reasonably be
expected to have a Material Adverse Effect,  except as disclosed on Schedule 6.9
hereto.

         6.10 Events of Default. No Default or Event of Default has occurred and
is continuing or would result from the  incurring of  obligations  by any of the
Credit  Parties under any of the Loan  Documents or any other  document to which
any of the Credit Parties is a party.

         6.11  Investment  Company Act of 1940. None of the Credit Parties is an
investment  company within the meaning of the Investment Company Act of 1940 and
none of the Credit Parties will become such an investment company.

         6.12 Public Utility  Holding Company Act. None of the Credit Parties is
a "holding  company" or a  "subsidiary  company" of a "holding  company,"  or an
"affiliate" of a "holding  company," or of a "subsidiary  company" of a "holding
company,"  within the  definitions of the Public Utility  Holding Company Act of
1935, as amended.

         6.13  Regulation  U. The  proceeds  of the  Advances  will not be used,
directly  or  indirectly,  to  purchase  or carry any Margin  Stock or to extend
credit to others for the purpose of purchasing or carrying any Margin Stock.

     6.14 No  Material  Adverse  Financial  Change.  There has been no  Material
Adverse  Financial  Change  since  the date of the  financial  and/or  operating
statements most recently submitted to the Lenders.


<PAGE>




         6.15  Financial  Information.  All financial  statements  and operating
statements  furnished to the Lenders by or at the direction of any of the Credit
Parties and all other  financial  information  and data  furnished by any of the
Credit Parties to the Lenders are complete and correct in all material  respects
as of the date  thereof,  and such  statements  have been prepared in accordance
with GAAP and fairly present the consolidated financial condition and results of
operations of the Credit  Parties and the Property as of such date.  None of the
Credit Parties has any contingent  obligations,  liabilities  for taxes or other
outstanding financial obligations which are material in the aggregate, except as
disclosed in such statements, information and data.

         6.16  Factual  Information.   All  factual  information  heretofore  or
contemporaneously  furnished by or on behalf of any of the Credit Parties to the
Lenders for purposes of or in connection  with this Agreement and the other Loan
Documents  and the  transactions  contemplated  therein  is,  and all other such
factual  information  hereafter  furnished  by or on behalf of any of the Credit
Parties to the Lenders will be, true and  accurate in all  material  respects on
the date as of which such  information  is dated or certified and not incomplete
by omitting to state any material fact  necessary to make such  information  not
misleading at such time.

         6.17 ERISA.  (i) None of the Credit Parties is an entity deemed to hold
"plan  assets"  within  the  meaning  of  ERISA or any  regulations  promulgated
thereunder  of an employee  benefit  plan (as defined in Section  3(3) of ERISA)
which is subject to Title I of ERISA or any plan  within the  meaning of Section
4975 of the Code,  and (ii) the  execution of this  Agreement and the other Loan
Documents and the transactions contemplated hereunder and thereunder do not give
rise to a prohibited  transaction  within the meaning of Section 406 of ERISA or
Section 4975 of the Code.

         6.18 Taxes.  All  required  tax returns  have been filed by each of the
Credit  Parties  with the  appropriate  authorities  except to the  extent  that
extensions of time to file have been requested,  granted and have not expired or
except to the extent such taxes are being contested in good faith by appropriate
proceedings and for which adequate reserves,  in accordance with GAAP, are being
maintained.

         6.19     Environmental Matters.  Except as disclosed in Schedule 6.19:

                           (i) The  Property  does not contain any  Materials of
                  Environmental  Concern  in  amounts  or  concentrations  which
                  constitute a violation of, or could  reasonably be expected to
                  give rise to liability under, Environmental Laws.

                           (ii) None of Borrower, its Subsidiaries or Investment
                  Affiliates has received any written  notice  alleging that any
                  or all of the Property or any or all of the  operations at the
                  Property   are  not  in   compliance   with   all   applicable
                  Environmental   Laws,   or  alleging  the   existence  of  any
                  contamination   at  or  under  such  Property  in  amounts  or
                  concentrations   which   constitute   a   violation   of   any
                  Environmental Law.


                           (iii) To the best of  Borrowers  knowledge  after due
                  inquiry,  no notice,  violation,  non-compliance  or liability
                  referred to in Section  6.19(ii) above is  threatened,  and no
                  condition,  fact or circumstance  exists that could reasonably
                  be   expected   to   result   in   such   notice,   violation,
                  non-compliance or liability.

                           (iv)     During the ownership of the Property by any
                  or all of Borrower,its Subsidiaries and Investment Affiliates,
                  no materials defined as hazardous or toxic


<PAGE>




                  by, or  otherwise  regulated  under,  any  Environmental  Laws
                  ("Materials") have been released,  transported or disposed of,
                  or otherwise  migrated,  from the Property in violation of, or
                  in a  manner  or  to a  location  which  could  reasonably  be
                  excepted  to  give  rise to  liability  under  any  applicable
                  Environmental  Laws,  nor during the ownership of the Property
                  by any or all of Borrower,  its  Subsidiaries  and  Investment
                  Affiliates have any Materials been generated, treated, stored,
                  abandoned or disposed of at, on or under any of such  Property
                  in  violation  of, or in a manner  that  could  reasonably  be
                  expected  to  give  rise to  liability  under  any  applicable
                  Environmental  Laws. To the best  knowledge of Borrower  after
                  due inquiry, no such release, transport,  disposal, migration,
                  generation,  treatment, abandonment or storage from, at, on or
                  under any of the Property occurred, prior to ownership thereof
                  by Borrower,  its Subsidiaries and Investment  Affiliates,  in
                  violation  of, or in a manner  or to a  location  which  could
                  reasonably  be expected to give rise to liability  under,  any
                  applicable Environmental Laws.

                           (v)  No  judicial   proceedings  or  governmental  or
                  administrative action is pending, or, to the best knowledge of
                  Borrower   after   due   inquiry,    threatened,   under   any
                  Environmental  Law to which Borrower,  any of its Subsidiaries
                  or any  Investment  Affiliate is named as a party with respect
                  to any of the  Property,  nor are there any  consent  or other
                  decrees, orders, or other administrative or judicial decisions
                  or requirements  outstanding  under any Environmental Law with
                  respect to such Property.

         6.20 Insurance.  Borrower has obtained, and fully paid all premiums due
on, the  following  policies or binders of insurance on the  Properties,  all of
which  shall  be  issued  by  companies  with a Best  Insurance  Reports  (1992)
Policyholder's and Financial Size Rating of "A-1X" or better:

                           (i) Property insurance  (including coverage for flood
                  and other water  damage for any  Properties  located  within a
                  100-year  flood  plain) in the  amount of 100  percent  of the
                  replacement cost of the improvements at the Propertie;

                           (ii)     Loss of rental income insurance in the
                  amount not less than one year's Gross Revenues from the
                  Properties; and

                           (iii)    Commercial general liability insurance in
                  the amount of at least $5,000,000 per occurrence.

                           All insurance must be carried by companies with a
                  Best Insurance Reports (1992) Policyholder's and Financial
                  Size Rating of "A-IX" or better.

         6.21 No Brokers. None of the Credit Parties has dealt with any brokers,
finders or other  intermediaries in connection with this Facility,  and no fees,
commissions  or other  compensation  are  payable  by or to any such  Person  in
connection with this Agreement or the Advances. Lenders shall not be responsible
for the  payment of any fees or  commissions  to any  brokers,  finders or other
intermediaries  and Borrower shall  indemnify,  defend and hold Lenders harmless
from and  against  any  claims,  liabilities,  obligations,  damages,  costs and
expenses (including  attorneys' fees and disbursements) made against or incurred
by Lenders  as a result of claims  made or actions  instituted  by any  brokers,
finders or other intermediaries  claiming by, through or under any of the Credit
Parties in connection with the Facility.



<PAGE>




     6.22 No  Violation  of Usury  Laws.  No aspect  of any of the  transactions
contemplated  herein  or in any of the other  Loan  Documents  violates  or will
violate any  applicable  usury laws or laws regarding the validity of agreements
to pay interest.

     6.23 Not a Foreign Person. None of the Credit Parties is a "foreign person"
within the meaning of Section 1445 or Section 7701 of the Code.

         6.24 No Trade Name.  Except as  otherwise  set forth on  Schedule  6.24
attached hereto,  none of the Credit Parties uses any trade name and has not and
does not do  business  under any name other than  their  actual  names set forth
herein.

         6.25  Subsidiaries.  Schedule  6.25 (as  updated  from  time to time in
accordance with this  Agreement)  hereto contains an accurate list of all of the
Subsidiaries  of  each  of  the  Credit  Parties,  which  Subsidiaries  are  not
themselves  Credit Parties,  and of all of the Investment  Affiliates of each of
the Credit Parties,  setting forth their respective  jurisdictions of formation,
the percentage of their respective  Capital Stock owned by each Credit Party and
the Property owned by them. All of the issued and outstanding  shares of Capital
Stock of all of the direct and indirect  Subsidiaries and Investment  Affiliates
of  Borrower  have been duly  authorized  and  issued and are fully paid and non
assessable.  All of such Capital Stock owned  directly or indirectly by Borrower
is free and clear of Liens,  except as otherwise  specifically noted on Schedule
6.25 (as updated from time to time).

         6.26 Properties.  Schedule 6.26 hereto (as updated from time to time in
accordance  with the terms of this  Agreement)  contains a complete and accurate
description,  as of the Agreement  Execution Date and the date of each update of
Schedule 6.26  submitted by Borrower  from time to time in  accordance  with the
terms of this Agreement, of each Property, including the name of the entity that
owns each such  Property,  and whether such Property is Eligible  Land,  Land, a
Project,  and/or an Unencumbered Asset. With respect to each Property,  Borrower
hereby represents and warrants as follows:

                  (a) Except as set forth on  Schedule  6.26,  no portion of any
improvement  on any  such  Property  is  located  in an area  identified  by the
Secretary of Housing and Urban  Development or any successor  thereto as an area
having  special flood hazards  pursuant to the National  Flood  Insurance Act of
1968 or the Flood Disaster  Protection Act of 1973, as amended, or any successor
law,  or, if located  within  any such  area,  Borrower  has  obtained  and will
maintain the insurance prescribed in Section 6.20 hereof.

                  (b) To the  Borrower's  knowledge,  except  as  set  forth  on
Schedule 6.26, each such Property and the development, use and occupancy thereof
are in  material  compliance  with all  applicable  zoning  ordinances  (without
reliance  upon  adjoining or other  properties),  building  codes,  land use and
Environmental Laws, and other laws regulating the development, use and occupancy
of real property ("Applicable Laws").

                  (c) Except as set forth on Schedule  6.26,  each such Property
is served by all  utilities  required  for the  current  and  contemplated  uses
thereof.  All  utility  service is  provided  by public  utilities  and the such
Property has accepted or is equipped to accept such utility service.

                  (d) Except as set forth on Schedule 6.26, all public roads and
streets  necessary  for  service  of and  access to each such  Property  for the
current or  contemplated  use thereof have been  completed,  are serviceable and
all-weather and are physically and legally open for use by the public.



<PAGE>




     (e) Except as set forth on Schedule  6.26,  each such Property is served by
public water and sewer systems.

                  (f) Except as set forth on Schedule  6.26,  each such Property
is  free  of  any  patent  or,  to  the  best  knowledge  of  Borrower  and  its
Subsidiaries,  latent  structural or other material  defect or deficiency.  Each
such  Property is free of damage and waste that would  materially  and adversely
affect its value, is in good repair and there is no deferred  maintenance  other
than  ordinary  wear and tear.  Each such Property is free from damage caused by
fire or other  casualty.  There is no  pending  or,  to the  best  knowledge  of
Borrower after due inquiry,  threatened  condemnation  proceedings affecting any
such Property, or any material part thereof.

                  (g) Except as set forth on Schedule 6.26, all liquid and solid
waste disposal,  septic and sewer systems located on each such Property are in a
good and safe  condition  and repair and are in compliance  with all  Applicable
Laws with respect to such systems.

                  (h) Except as set forth on Schedule 6.26, all  improvements on
each such Property lie within the  boundaries and building  restrictions  of the
legal description of record of such Property no such improvements  encroach upon
any adjoining  property,  and no improvements on adjoining  properties  encroach
upon such Property or easements benefiting such Property. All amenities,  access
routes or other items that  benefit such  Property  are under direct  control of
Borrower or one of its Subsidiaries, constitute permanent easements that benefit
all or part of such Property or are public property, and such Property by virtue
of such easements or otherwise,  is contiguous to a physically  open,  dedicated
all weather public street, and has the necessary permits for ingress and egress.

                  (i)  Except  as set  forth  on  Schedule  6.26,  there  are no
delinquent  taxes,  ground  rents,  water  charges,  sewer  rents,  assessments,
insurance premiums,  leasehold payments,  or other outstanding charges affecting
any such  Property  except to the extent such items are being  contested in good
faith by appropriate  proceedings  and as to which  adequate  reserves have been
provided.

                  Except as set forth on  Schedule  6.26,  with  respect to each
                      parcel of Eligible Land, each required  performance  bond,
                      surety or other  security  has been issued to and in favor
                      of  and   unconditionally   accepted   by  each   relevant
                      governmental  authority,  all  plans,  specifications  and
                      drawings  for  improvements  have  been  approved  by  all
                      relevant  governmental  authorities,   and  all  necessary
                      easements, licenses, permits and other authorizations have
                      been  granted  for  the  development  thereof  (including,
                      without limitation,  demolition,  grading and construction
                      permits).

         Any breach of the  representations  or  warranties in this Section 6.26
shall  disqualify such Property from being an  Unencumbered  Asset but shall not
per se constitute an Event of Default or Default under this Agreement.

         6.27 Relationship of the Borrower. The Credit Parties are engaged as an
integrated  group in the business of owning,  developing  operating  and selling
real estate. The Credit Parties require financing on such a basis that funds can
be made available from time to time to such entities, to the extent required for
the continued successful operation of their integrated operations.  The Advances
to be made to the Borrower under this Agreement are for the purpose of financing
the integrated  operations of the Credit Parties, and each of the Credit Parties
expects to derive  benefit,  directly or  indirectly,  from the  Advances,  both
individually and as a member of the integrated group, since the


<PAGE>




financial  success of the operations of Borrower and each Guarantor is dependent
upon the continued successful performance of the integrated group as a whole.

         6.28 No  Side  Deals.  None  of the  Borrower  or its  Subsidiaries  or
Affiliates  have entered into any written or oral  agreements,  arrangements  or
understandings  with any Lender or any  Affiliate of any Lender  relating to the
Facility or the Loan Documents, except as otherwise disclosed in this Agreement.

                                   ARTICLE VII

                               FINANCIAL COVENANTS

         The Borrower covenants and agrees that, so long as the Commitment shall
remain in effect and until full and final  payment of all  Obligations,  without
the prior written consent of the Majority Lenders, it shall not, and shall cause
the other Credit Parties not to:

         7.1  Minimum  Consolidated  Net  Worth.  As of the  end  of any  fiscal
quarter,  permit  Consolidated  Net  Worth  to be  less  than  the  sum  of  (i)
$150,000,000, plus (ii) an amount equal to ninety percent (90%) of the aggregate
proceeds  received by Borrower  (net of customary  related fees and expenses) in
connection  with any equity  offering  (including  the issuance of shares in the
General Partner or units in the Borrower) after the Agreement Execution Date.

     7.2  Maximum  Consolidated  Leverage  Ratio.  As of the  end of any  fiscal
quarter,  permit the ratio of Consolidated  Total  Indebtedness to exceed 50% of
the Gross Asset Value.

     7.3 Minimum  Consolidated  Interest  Coverage  Ratio.  As of the end of any
fiscal quarter,  permit the ratio of Adjusted  EBITDA to Interest  Expense to be
less than 2.00:1.

     7.4  Minimum  Fixed  Charge  Coverage  Ratio.  As of the end of any  fiscal
quarter,  permit the ratio of Adjusted  EBITDA to Fixed  Charges to be less than
1.75:1.

     7.5 Maximum  Unencumbered Asset Coverage Ratio. As of the end of any fiscal
quarter,  Consolidated Unsecured Debt to exceed 50% of the Value of Unencumbered
Assets.

         7.6 Minimum Unencumbered Asset NOI to Unsecured Interest. As of the end
of any  fiscal  quarter,  permit  the ratio  obtained  by  dividing  (A)  "Total
Unencumbered NOI" (as hereinafter defined) for such quarter by (B) "Unencumbered
Interest Expense" (as hereafter defined) on all Consolidated  Unsecured Debt for
such  quarter to be less than 2.00 to 1. For  purposes of this  Section 7.6, (1)
"Unencumbered  Interest Expense" shall have the same meaning as Interest Expense
except that clause (iv) of such  definition  shall include only  Indebtedness of
those  Investment  Affiliates  that are also Eligible  Joint  Ventures,  and (2)
"Total  Unencumbered  NOI" shall mean the sum of (i) Unencumbered NOI qualifying
for inclusion in the  calculation of the Value of  Unencumbered  Assets for such
quarter (as such  Unencumbered NOI is annualized);  less a capital reserve equal
to the product of (a) $1.25,  multiplied by (b) the  aggregate  amount of Leased
Space at those Projects  constituting  Unencumbered Assets for such period, plus
(ii)  Unencumbered NOI for any Unencumbered  Assets acquired or sold during such
quarter (as such  Unencumbered NOI is annualized),  less a capital reserve equal
to (a) $1.25,  multiplied  by (b) the weighted  average of Leased Space at those
Projects constituting Unencumbered Assets for such period.

     7.7 Maximum  Secured Debt to Gross Asset Value. As of the end of any fiscal
quarter,


<PAGE>




(i) prior to the earlier of (1) March 25, 1998 or (2) the  repayment  in full of
the Existing  Facility permit  Consolidated  Secured Debt to exceed 45% of Gross
Asset Value, and (ii) thereafter, permit Consolidated Secured Debt to exceed 35%
of Gross Asset Value;


     7.8  Maximum  Dividend  Payout  Ratio.  Pay  out,  in any  fiscal  quarter,
aggregate  dividends to the shareholders of the General Partner in excess of 90%
of its Funds From Operations from such quarter.

Compliance with each of the foregoing  financial covenants shall be measured and
certified as of September 30, 1997 and on the last day of each fiscal quarter in
accordance with Section 8.2 hereof.

                                  ARTICLE VIII

                              AFFIRMATIVE COVENANTS

         The Borrower covenants and agrees that so long as the Commitment of any
Lender  shall  remain  available  and until the full and  final  payment  of all
Obligations incurred under the Loan Documents they will:

         8.1      Notices.  Promptly give written notice to Administrative Agent
of:

     (a) all litigation or arbitration proceedings affecting the Borrower or any
of the other Credit Parties where the amount claimed is $5,000,000 or more;

                  (b) any Default or Event of Default, specifying the nature and
the period of existence  thereof and what action has been taken or been proposed
to be taken with respect thereto;

     (c) all claims  filed  against  any of the  Property  which,  if  adversely
determined, could have a Material Adverse Effect;

     (d) the  occurrence of any other event which might have a Material  Adverse
Effect;

     (e) any Reportable  Event or any "prohibited  transaction" (as such term is
defined in Section  4975 of the Code) in  connection  with any Plan or any trust
created thereunder,  which may, singly or in the aggregate materially impair the
ability of any of the Credit Parties to repay any of its  obligations  under the
Loan Documents, describing the nature of each such event and the action, if any,
such Credit Party proposes to take with respect thereto;

     (f) any  notice  from  any  federal,  state,  local  or  foreign  authority
regarding any Hazardous Material,  asbestos,  or other environmental  condition,
proceeding, order, claim or violation affecting any of the Properties.

     8.2 Financial Statements,  Reports.  Etc. The Borrower shall maintain,  for
itself and each entity in the Consolidated  Operating Partnership,  a system of
accounting  established and administered in accordance with GAAP, and furnish to
the Lenders:

     (i) as soon as available, but in any event not later than 45 days after the
close of each fiscal  quarter,  for the  Consolidated  Operating  Partnership an
unaudited


<PAGE>




                  consolidated balance sheet as of the close of each such period
                  and the related  unaudited  consolidated  statements of income
                  and retained  earnings  and of cash flows of the  Consolidated
                  Operating  Partnership  for such period and the portion of the
                  fiscal year through the end of such period,  setting  forth in
                  each case in comparative  form the  corresponding  figures for
                  the previous year, all certified by a Qualified Officer of the
                  General Partner;

                           (ii) As soon as available, but in any event not later
                  than 45 days after the close of each fiscal  quarter,  for the
                  Consolidated  Operating  Partnership,  related reports in form
                  and substance  satisfactory to the Lenders, all certified by a
                  Qualified Officer of the General Partner, including updates of
                  Schedules 6.1, 6.25 and 6.26 of this Agreement, a statement of
                  Funds From Operations, a description of Unencumbered Assets, a
                  listing  of  capital  expenditures  (in the level of detail as
                  currently disclosed in Borrower's "Supplemental Information"),
                  a report  listing and  describing all newly formed or acquired
                  Subsidiaries  and all  newly  acquired  Properties,  including
                  their cost and  Indebtedness  assumed in connection  with such
                  acquisition,  if any,  summary  information  for all Property,
                  including,  without  limitation,  occupancy  rates  (including
                  Leased Space), square footage, property type, date acquired or
                  built,  Gross  Revenues,   Net  Operating  Income,   operating
                  expenses, capital expenditures, the status of development, and
                  such other information as may be requested (including, without
                  limitation,  operating  statements)  to evaluate the quarterly
                  compliance certificate delivered as provided below;

                           (iii) As soon as available but in no event later than
                  the fifth  Business  Day after the date such reports are to be
                  filed with the Securities Exchange  Commission,  copies of any
                  Forms 10K,  10Q, 8K, and,  within ten (10) Business Days after
                  filing, any other annual, quarterly, monthly or other reports,
                  copies of all  registration  statements  and any other  public
                  information which the Consolidated Operating Partnership files
                  with the Securities  Exchange Commission or other governmental
                  authority,  and to the  extent  any of such  reports  contains
                  information  furnished under other subsections of this Section
                  8.2, the information need not be separately furnished;

                           (iv) As soon as available, but in any event not later
                  than 90 days  after  the  close  of  each  fiscal  year of the
                  Consolidated  Operating  Partnership,  a consolidated  and, if
                  available,  consolidating  balance  sheet of the  Consolidated
                  Operating  Partnership  as of the end of that  fiscal year and
                  related   consolidated   and,  if   available,   consolidating
                  statements  of  income,  retained  earnings,  cash  flows  and
                  stockholders'  equity for that fiscal year,  in each case with
                  accompanying notes and schedules,  prepared in accordance with
                  GAAP and  audited by a firm of  independent  certified  public
                  accountants  of recognized  standing  selected by Borrower and
                  acceptable  to the  Administrative  Agent,  which  accountants
                  shall have issued an unqualified audit report thereon;

                           (v) Within  thirty (30) days after the  beginning  of
                  each  fiscal year of  Consolidated  Operating  Partnership,  a
                  projection  in  reasonable  detail  and in form and  substance
                  satisfactory to the Administrative  Agent, on an annual basis,
                  of the  assets,  liabilities,  cash flow and  earnings  of the
                  Consolidated  Operating  Partnership  for that fiscal year and
                  the following fiscal year;



<PAGE>




                           (vi) As soon as available, but in any event not later
                  than three  Business Days after receipt  thereof by any entity
                  in  the  Consolidated  Operating  Partnership,  all  quarterly
                  financial  statements,  operating  reports and other financial
                  and  operating  information  regarding  Investment  Affiliates
                  and/or Property owned by any Investment Affiliate;

                           (vii)  As soon as  available,  but in any  event  not
                  later  than 120 days  after the close of each  fiscal  year of
                  each Investment Affiliate,  a balance sheet of such Investment
                  Affiliate  as of the  end of  that  fiscal  year  and  related
                  statements  of  income,   retained  earnings,  cash  flow  and
                  stockholders'  equity for that fiscal year, with  accompanying
                  notes and  schedules,  prepared  in  accordance  with GAAP and
                  audited by a firm of independent certified public accountants,
                  which accountants have issued an unqualified report thereon;

                           (viii) Not later than  forty-five (45) days after the
                  end of each of the first three fiscal quarters,  and not later
                  than  ninety  (90) days  after the end of the fiscal  year,  a
                  compliance  certificate in substantially the form of Exhibit F
                  hereto  signed by a Qualified  Officer of the General  Partner
                  confirming  that the Borrower is in compliance with all of the
                  covenants of the Loan Documents,  showing the calculations and
                  computations   necessary  to  determine  compliance  with  the
                  financial  covenants  contained in this  Agreement  (including
                  such  schedules and backup  information as may be necessary to
                  demonstrate  such  compliance)  and stating that no Default or
                  Event of Default exists, or if any Default or Event of Default
                  exists, stating the nature and status thereof;

                           (ix) As soon as possible  and in any event  within 10
                  Business  Days after any  Reportable  Event has occurred  with
                  respect  to any  Plan,  a  statement,  signed  by a  Qualified
                  Officer of the General  Partner,  describing  said  Reportable
                  Event and  within  20 days  after  such  Reportable  Event,  a
                  statement  signed by such officer  describing the action which
                  Borrower proposes to take with respect thereto; and (b) within
                  10  Business  Days of receipt,  any notice  from the  Internal
                  Revenue Service, PBGC or Department of Labor with respect to a
                  Plan regarding any excise tax, proposed termination of a Plan,
                  prohibited  transaction or fiduciary  violation under ERISA or
                  the Code which could  result in any  liability  to Borrower or
                  any member of the Controlled Group in excess of $100,000;  and
                  (c) within 10 Business Days of filing,  any Form 5500 filed by
                  Borrower  with  respect  to a  Plan,  or  any  member  of  the
                  Controlled  Group  which  includes  a  qualified  accountant's
                  opinion.

                           (x) As soon as  possible  and in any event  within 10
                  days after receipt by the  Borrower,  a copy of (a) any notice
                  or claim to the  effect  that any  entity in the  Consolidated
                  Operating  Partnership  or  Investment  Affiliate is or may be
                  liable  to any  Person  as a  result  of the  release  by such
                  entity, or any of its Subsidiaries, or any other Person of any
                  toxic or hazardous  waste or substance  into the  environment,
                  and (b) any notice  alleging  any  violation  of any  federal,
                  state  or  local  environmental,   health  or  safety  law  or
                  regulation  by the  Borrower  or any  of its  Subsidiaries  or
                  Investment  Affiliates,   which,  in  either  case,  could  be
                  reasonably likely to have a Material Adverse Effect;

                           (xi)     Within thirty (30) days of the furnishing
                  thereof to the shareholders of the Borrower, copies of all
                  financial statements, reports, notices and proxy


<PAGE>




                  statements  so  furnished,  provided that to the extent any of
                  such information has been furnished under other subsections of
                  this  Section 8.2,  such  information  need not be  separately
                  furnished;

                           (xii) As soon as possible, and in any event within 10
                  days after the Borrower knows of any fire or other casualty or
                  any  pending or  threatened  condemnation  or  eminent  domain
                  proceeding with respect to all or any material  portion of any
                  of the Property,  a statement signed by a Qualified Officer of
                  General   Partner,   describing   such   fire,   casualty   or
                  condemnation  and the  action  Borrower  intends  to take with
                  respect thereto; and

                           (xiii) Such  supplements  to the foregoing  documents
                  and  other   information   (including,   without   limitation,
                  non-financial  information) as the Administrative Agent or any
                  Lender may from time to time reasonably request.

         8.3 Existence and Conduct of Operations.  Except as otherwise expressly
permitted  herein,  the Borrower shall, and shall cause each of the other Credit
Parties to,  maintain and preserve its existence and all rights,  privileges and
franchises  now  enjoyed  and  necessary  for  the  operation  of its  business,
including  remaining in good standing in each  jurisdiction in which business is
currently operated. The Borrower shall, and shall cause each of the other Credit
Parties to, carry on and conduct their  respective  businesses in  substantially
the same manner and in substantially  the same fields of enterprise as presently
conducted.  The Borrower shall, and shall cause each of the other Credit Parties
to, do all things necessary to remain duly  incorporated  and/or duly qualified,
validly  existing  and in  good  standing  as a real  estate  investment  trust,
corporation,   general   partnership,   limited  liability  company  or  limited
partnership, as the case may be, in its jurisdiction of incorporation/formation.
The  Borrower  shall,  and shall  cause  each of the other  Credit  Parties  to,
maintain all requisite authority to conduct its business in each jurisdiction in
which any of the Properties  are located and,  except where the failure to be so
qualified  would  not  have a  Material  Adverse  Effect,  in each  jurisdiction
required to carry on and conduct its businesses in substantially the same manner
as it is presently conducted,  and,  specifically,  neither the Borrower nor its
Subsidiaries   will   undertake  any  business   other  than  the   acquisition,
development,  ownership,  management, operation and leasing of office properties
and ancillary businesses  specifically related thereto, except that the Borrower
and its  Subsidiaries  and  Investment  Affiliates  may  invest in other  assets
subject  to  the  certain  limitations  contained  herein  with  respect  to the
following specified categories of assets: (i) Land; (ii) other property holdings
(excluding  cash, Cash  Equivalents,  and  Indebtedness of any Subsidiary to the
Borrower); (iii) stock holdings other than in Subsidiaries;  (iv) mortgages; (v)
joint ventures and partnerships;  and (vi) projects under development. The total
investment in any one of categories  (i), (ii), (iv) or (v) shall not exceed 10%
of Gross Asset Value,  the total  investment in category  (iii) shall not exceed
five percent (5%) of Gross Asset Value and the total investment in category (vi)
shall not exceed 15% of Gross Asset Value,  and the total  investment in all the
foregoing  investment  categories in the aggregate shall not exceed  twenty-five
percent  (25%) of Gross Asset  Value.  Notwithstanding  anything to the contrary
contained in this Section 8.3, any Eligible  Joint  Venture  which is one of the
Credit  Parties  will not be  limited  by the  foregoing  restrictions.  For the
purposes of this Section 8.3, all  investments in categories (i), (iii) and (iv)
shall be valued at the lower of  acquisition  cost or market value and the value
of any  investment  in category  (ii) shall be calculated as the quotient of (x)
Net Operating Income generated from such investment, divided by (y) 15%.

     8.4  Maintenance of  Properties.  The Borrower  shall,  and shall cause the
other Credit Parties to, maintain,  preserve, protect and keep the Properties in
good and safe repair, working order


<PAGE>




and condition, and make all necessary and proper repairs, renewals and
replacements.

         8.5  Insurance.  The Borrower  shall,  and shall cause the other Credit
Parties to, provide a certificate of insurance from all insurance carriers which
have issued  policies  with respect to any  Properties  within  thirty (30) days
after the end of each fiscal year,  evidencing that the insurance required to be
furnished  to  Lenders  pursuant  to  Section  6.20  hereof is in full force and
effect. The Administrative Agent (for the benefit of the Lenders) shall be named
as a loss payee on each such policy of casualty  insurance  and as an additional
insured on each such policy of  liability  insurance,  and all such  policies of
insurance  shall contain  provisions to the effect that they may not be canceled
or materially  changed  without at least 30 days prior notice to  Administrative
Agent.  Borrower  shall  timely  pay, or cause to be paid,  all  premiums on all
insurance  policies  required under this  Agreement from time to time.  Borrower
shall,  and  shall  cause the other  Credit  Parties  to,  promptly  notify  the
insurance  carrier or agent  therefor  (with a copy of such  notification  being
provided  simultaneously  to  Administrative  Agent) if there is any  occurrence
which,  under the terms of any  insurance  policy then in effect with respect to
any of the Properties, requires such notification.

         8.6 Payment of  Obligations.  The Borrower  shall,  and shall cause the
other Credit Parties to, pay all taxes,  assessments,  governmental  charges and
other  obligations  when due,  except such as may be  contested in good faith by
appropriate  proceedings,  and for which adequate reserves have been provided in
accordance with sound accounting principles.

         8.7 Compliance with Laws. The Borrower shall, and shall cause the other
Credit  Parties to, comply in all material  respects with all  applicable  laws,
rules,  regulations,  orders and directions of any governmental authority having
jurisdiction  over Borrower,  any of the other Credit  Parties,  or any of their
respective businesses or assets.

         8.8  Adequate  Books.  The  Borrower  shall,  and shall cause the other
Credit Parties to,  maintain  adequate  books,  accounts and records in order to
provide  financial  statements in accordance  with GAAP and, if requested by any
Lender,  permit  employees or  representatives  of such Lender at any reasonable
time and upon  reasonable  notice  (i) to  inspect  and audit the  assets of the
Credit Parties or any of them,  (ii) to examine or audit the  inventory,  books,
accounts and records of each of them and make copies and memoranda thereof,  and
(iii) to  consult  with  appropriate  personnel  of each of them  regarding  the
foregoing.

         8.9 ERISA. The Borrower shall, and shall cause the other Credit Parties
to, comply in all material  respects with all  requirements of ERISA  applicable
with respect to each Plan.

         8.10 Maintenance of Status. General Partner shall at all times continue
to have its  common  stock  listed  and in good  standing  on the New York Stock
Exchange (NYSE), and Borrower shall take all steps to maintain General Partner's
status as a real  estate  investment  trust in  compliance  with all  applicable
provisions of the Code.

         8.11 Use of  Proceeds.  The  Borrower  shall  use the  proceeds  of the
Facility solely for the general  business  purposes of the Borrower,  including,
without  limitation,  working capital needs,  closing costs, and interim funding
for acquisitions and development of office and light industrial real properties.

     8.12 Pre-Acquisition Environmental Investigations.  The Borrower shall, and
shall cause each of the Credit Parties to, obtain,  prior to the  acquisition of
each parcel of real property that it intends to acquire, an environmental report
of the scope described in Exhibit G attached hereto and made a part hereof.


<PAGE>


         8.13 New Subsidiaries.  The Borrower shall, from time to time, promptly
cause each Person that  becomes a  wholly-owned  Subsidiary  of General  Partner
after  the  Agreement  Execution  Date  to  duly  execute  and  deliver  to  the
Administrative Agent a Guaranty of the Obligations.  Notwithstanding anything to
the contrary contained herein,  such duly executed  Guaranty,  together with the
related  documentation  required  to be  furnished  pursuant  to Section  5.2(c)
hereof,  shall be  delivered to the  Administrative  Agent no later than 45 days
after the end of the fiscal quarter during which such Person became a Subsidiary
of General Partner.

     8.14 Distributions. Neither the General Partner nor the Borrower shall make
any  distributions  which  would  cause  a  violation  of any  of the  following
covenants:

                  (a) The General Partner shall not pay any distributions to its
shareholders  and the Borrower shall not pay any distribution to the partners of
the Borrower if such distribution would cause a violation of Section 7.8 hereof;
provided,  however,  the Borrower may make  distributions to the General Partner
which correspond in amount and timing to distributions which the General Partner
is permitted by Section 7.8 to make to its shareholders and other  distributions
to the General Partner for "REIT Expenses" as defined in Borrower's Agreement of
Limited Partnership delivered pursuant to Section 5.1(b) hereof;

     If an Event of Default  specified  in Section 10.1 or Section  10.3,  or an
Event of Default  relating to a breach of the financial  covenants  contained in
Article VII above,  shall have occurred and be continuing,  the Borrower and the
General Partner shall make no distributions other than the minimum distributions
required  under the Code to maintain the tax status of the General  Partner as a
REIT, as evidenced by a certification  of the principal  financial or accounting
officer of the General  Partner  containing  calculations  in reasonable  detail
satisfactory in form and substance to Administrative Agent; and

     Notwithstanding  the foregoing,  at any time when an Event of Default shall
have  occurred and the maturity of the  Obligations  has been  accelerated,  the
Borrower  and  General  Partner  shall  not make any  distributions  whatsoever,
directly or indirectly.

                                   ARTICLE IX

                               NEGATIVE COVENANTS

         The Borrower covenants and agrees that, so long as the Commitment shall
remain in effect and until full and final  payment of all  Obligations  incurred
under the Loan  Documents,  without the prior  written  consent of the  Majority
Lenders, it shall not, and shall cause the other Credit Parties not to:

         9.1 Change in Business.  Except as otherwise  permitted  under  Section
8.3,  engage in any business  activities or operations  other than  acquisition,
development,  ownership,  management,  operation and leasing of office and light
industrial real property and ancillary businesses specifically related thereto.

         9.2      Intentionally Deleted.

     9.3 Change of Borrower Ownership. Allow (i) the General Partner to own less
than


<PAGE>




fifty-one  percent  (51%) of the  partnership  interests in  Borrower,  (ii) the
Borrower to be controlled by a Person other than the General  Partner,  or (iii)
any  pledge of,  other  encumbrance  on, or  conversion  to limited  partnership
interests of, any of the general partnership interests in the Borrower.

         9.4 Use of Proceeds.  Apply or permit to be applied any proceeds of any
Advance directly or indirectly, to the funding of any purchase of, or offer for,
any share of capital stock of any publicly held corporation  constituting (alone
or  together  with  other  shares  owned  by  Borrower  or its  Subsidiaries)  a
controlling interest in such corporation, or as part of a series of transactions
to acquire  such  controlling  interest,  unless the board of  directors of such
corporation  has  consented  to such  purchase  or offer  and the  Lenders  have
consented to such use of the proceeds of the Facility.

         9.5 Transfers of Assets.  Sell or otherwise  dispose of (other than the
creation or  continuance  of Permitted  Liens) any Properties or other assets or
any interest therein, if such Property or other assets,  together with all other
assets which have been  transferred  or disposed of prior to such date,  exceeds
twenty percent (20%) of the Gross Asset Value of Borrower.

     9.6 Liens.  Create,  incur, or suffer to exist any Lien in, of or on any of
the Properties except:

                           (i)  Liens for  taxes,  assessments  or  governmental
                  charges or levies on their  Property  if the same shall not at
                  the  time be  delinquent  or  thereafter  can be paid  without
                  penalty,   or  are  being  contested  in  good  faith  and  by
                  appropriate  proceedings and for which adequate reserves shall
                  have been set aside on their books;

                           (ii) Liens which arise by operation  of law,  such as
                  carriers',   warehousemen's,   landlords',   materialmen   and
                  mechanics'  liens  and  other  similar  liens  arising  in the
                  ordinary   course  of  business   which   secure   payment  of
                  obligations  not more than 30 days past due or which are being
                  contested  in good faith by  appropriate  proceedings  and for
                  which  adequate  reserves  shall  have  been set  aside on its
                  books;

                           (iii) Liens arising out of pledges or deposits  under
                  worker's compensation laws,  unemployment  insurance,  old age
                  pensions,  or other social security or retirement benefits, or
                  similar legislation;

                           (iv) Utility easements, building restrictions, zoning
                  restrictions, easements and such other encumbrances or charges
                  against real  property as are of a nature  generally  existing
                  with respect to properties of a similar character and which do
                  not in any material way affect the  marketability  of the same
                  or  interfere  with the use  thereof  in the  business  of the
                  Borrower or any of the other Credit Parties;

                           (v) Liens of any Subsidiary in favor of the Borrower;

                           (vi)   Liens   arising   in   connection   with   any
                  Indebtedness permitted hereunder to the extent such Liens will
                  not result in a  violation  of any of the  provisions  of this
                  Agreement; and

                           (vii)Liens described in Schedule 9.6 attached hereto.



<PAGE>




Liens  permitted  pursuant to this Section 9.6 shall be deemed to be  "Permitted
Liens".

     9.7  Regulation  U. Use any of the  proceeds of the Advances to purchase or
carry any Margin Stock.

         9.8 Mergers  and  Dispositions.  Enter into any merger,  consolidation,
pool,  business  combination,  reorganization  or  liquidation,  or  transfer or
otherwise dispose of all or a substantial portion of its properties, except for:
such transactions  that occur between  wholly-owned  Subsidiaries;  transactions
where  Borrower  is the  surviving  entity  and there is no  change in  business
conducted,  and no Default or Event of Default under the Loan Documents  results
from such transaction; or as otherwise approved in advance by the Lenders.

         9.9      Negative Pledge. Agree with any third party not to create,
assume or suffer to exist any Lien securing a charge or obligation on any of its
real or personal property, whether now owned or hereafter acquired.

         9.10     Consolidated Secured Recourse Debt.  At any time, allow
Consolidated Secured Debt that is recourse to the Borrower or any other entity
in the Consolidated Operating Partnership to exceed ten percent (10%) of Gross
Asset Value.

                                                     ARTICLE X

                                                     DEFAULTS

         The  occurrence  of any  one or  more  of the  following  events  shall
constitute an Event of Default:

     10.1  Nonpayment  of  Principal.  The Borrower  fails to pay any  principal
portion of the Obligations when due, whether on the Maturity Date or otherwise.

     10.2 Certain Covenants.  The Borrower,  General Partner and/or Consolidated
Operating Partnership,  as the case may be, is not in compliance with any one or
more of the  provisions  of Article VII or Article IX  (excluding  Section  9.1)
hereof.

         10.3 Nonpayment of Interest and Other  Obligations.  The Borrower fails
to pay any interest or other portion of the Obligations,  other than payments of
principal,  and such failure  continues  for a period of ten (10) days after the
date such payment is due.

         10.4 Cross Default. Any monetary default occurs (after giving effect to
any applicable cure period) under any  Indebtedness  (which  includes  liability
under guaranties) of any entity in the Consolidated  Operating Group,  singly or
in the aggregate,  in excess of Five Million  Dollars  ($5,000,000),  other than
Indebtedness  arising from the purchase of personal property or the provision of
services,  the amount of which is being  contested  by Borrower in good faith by
appropriate proceedings.

         10.5 Loan Documents.  Any Loan Document is not in full force and effect
in  accordance  with its terms,  or a default  has  occurred  and is  continuing
thereunder after giving effect to any cure or grace period in any such document.

     10.6  Representation  or  Warranty.  At any  time or  times  hereafter  any
representation or


<PAGE>




warranty  set forth in  Article VI or Article  VII of this  Agreement  or in any
other Loan Document or in any statement,  report or certificate now or hereafter
made by any entity in the  Consolidated  Operating  Group to the  Lenders or the
Administrative Agent is not true and correct in any material respect.

         10.7 Covenants,  Agreements and Other Conditions. The Borrower fails to
perform or observe any of the covenants,  agreements and conditions contained in
this Agreement or any of the other Loan Documents not  specifically  referred to
in any other Section of this Article X, in  accordance  with the terms hereof or
thereof,  and such Default continues unremedied for a period of thirty (30) days
after written notice from Administrative Agent, provided,  however, that if such
Default is  susceptible  of cure but cannot by the use of reasonable  efforts be
cured within such thirty (30) day period,  such Default shall not  constitute an
Event  of  Default  under  this  Section  10.7 so long as (i) the  Borrower  has
commenced a cure within such thirty-day  period in a manner  satisfactory to the
Administrative  Agent and (ii)  thereafter,  Borrower is proceeding to cure such
default  continuously and diligently and in a manner reasonably  satisfactory to
Administrative  Agent and (iii) such default is cured to Administrative  Agent's
satisfaction  not later than sixty (60) days after the expiration of such thirty
(30) day period.

     10.8 No Longer General Partner.  The General Partner shall no longer be the
sole general partner of Borrower.

     10.9  Material  Adverse  Financial  Change.  Any  of  the  Borrower  or the
Guarantors have suffered a Material Adverse Financial Change or is Insolvent.

         10.10             Bankruptcy.

                  (a) Any of the  Borrower or the  Guarantors  (i) have an order
for relief entered with respect to it under the Federal  bankruptcy  laws as now
or hereafter in effect,  (ii) make an  assignment  for the benefit of creditors,
(iii)  apply for,  seek,  consent  to, or  acquiesce  in, the  appointment  of a
receiver, custodian, trustee, examiner, liquidator or similar official for it or
any substantial  portion of its Property,  (iv) institute any proceeding seeking
an order for relief  under the Federal  bankruptcy  laws as now or  hereafter in
effect or  seeking  to  adjudicate  it as a bankrupt  or  insolvent,  or seeking
dissolution, winding up, liquidation, reorganization, arrangement, adjustment or
composition of it or its debts under any law relating to bankruptcy,  insolvency
or  reorganization  or  relief  of  debtors  or fail to file an  answer or other
pleading  denying the material  allegations of any such proceeding filed against
it, (v) take any  corporate  action to authorize or effect any of the  foregoing
actions set forth in this Section  10.10(a),  (vi) fail to contest in good faith
any appointment or proceeding described in Section 10.10(b) or (vii) not pay, or
admit in writing its inability to pay, its debts generally as they become due.

                  (b) A  receiver,  trustee,  examiner,  liquidator  or  similar
official  shall be  appointed  for any of the  Borrower or any  Guarantor or any
substantial  portion of any of their Properties or other material  assets,  or a
proceeding  described in Section 10.10(a)(iv) shall be instituted against any of
the Borrower or any such Guarantor and such appointment  continues  undischarged
or such proceeding continues  undismissed or unstayed for a period of sixty (60)
consecutive days.

         10.11  Legal  Proceedings.  Any of the  Borrower or the  Guarantors  is
enjoined, restrained or in any way impaired by any court order or judgment or if
a notice of lien,  levy, or assessment is filed of record with respect to all or
any part of  their  Properties  or other  material  assets  by any  governmental
department, office, agency or authority, which, alone or in the aggregate, could
have


<PAGE>




a Materially  Adverse Effect, or any proceeding is filed or commenced seeking to
enjoin,  restrain or otherwise impair any of said Persons from conducting all or
a substantial part of their respective business affairs,  and such proceeding is
not  vacated,  stayed,  dismissed,  set aside,  removed or otherwise or remedied
within ninety (90) days after the occurrence thereof.

         10.12 ERISA.  Any of the Borrower or the  Guarantors  is deemed to hold
"plan  assets"  within  the  meaning  of  ERISA or any  regulations  promulgated
thereunder  of an employee  benefit  plan (as defined in Section  3(3) of ERISA)
which is subject to Title I of ERISA or any plan  (within the meaning of Section
4975 of the Code).

         10.13  Failure  to  Satisfy  Judgments.  Any  of  the  Borrower  or the
Guarantors shall fail within sixty (60) days to pay, bond or otherwise discharge
any judgments or orders for the payment of money in an amount which,  when added
to all other  judgments  or  orders  outstanding  against  the  Borrower  or any
Guarantor would exceed Five Million Dollars ($5,000,000) in the aggregate, which
have not been stayed pending appeal, unless the liability is insured against and
the insurer has not challenged coverage of such liability.

         10.14 Environmental  Remediation.  Failure to remediate within the time
period  required by law or governmental  order,  (or within a reasonable time in
light  of  the  nature  of  the  problem  if  no  specific  time  period  is  so
established),  environmental  problems in violation of applicable law related to
any Property  where the  estimated  cost of  remediation  is in the aggregate in
excess of Five Million and No/100 Dollars  ($5,000,000),  in each case after all
administrative hearings and appeals have been concluded.

                                   ARTICLE XI

                  ACCELERATION, WAIVERS AMENDMENTS AND REMEDIES

         11.1  Acceleration.  If any Event of Default described in Section 10.10
hereof occurs,  the obligation of the Lenders to make Advances  hereunder  shall
automatically  terminate and the Obligations  shall  immediately  become due and
payable.  If any other Event of Default described in Article X hereof shall have
occurred and be continuing, the Administrative Agent may (and upon demand of the
Majority  Lenders,  shall) notify Borrower that such obligation to make Advances
has terminated and the Obligations shall immediately become due and payable.

         11.2  Preservation of Rights;  Amendments.  No delay or omission of the
Lenders in exercising any right under the Loan Documents shall impair such right
or be  construed  to be a  waiver  of any  Default  or Event  of  Default  or an
acquiescence therein, and the making of an Advance notwithstanding the existence
of a Default or Event of Default or the inability of the Borrower to satisfy any
conditions  precedent  to such  Advance  shall  not  constitute  any  waiver  or
acquiescence.  Any  single  or  partial  exercise  of any such  right  shall not
preclude other or further  exercise  thereof or the exercise of any other right,
and no waiver, amendment, release or other variation of the terms, conditions or
provisions  of the Loan  Documents  whatsoever  shall be valid unless in writing
signed by the Administrative  Agent and the number of Lenders required hereunder
and then only to the extent in such writing specifically set forth. All remedies
contained in the Loan Documents or by law afforded shall be cumulative,  and may
be exercised  concurrently  or  successively,  and all shall be available to the
Lenders until the Obligations have been paid in full.



<PAGE>




                                   ARTICLE XII

                            THE ADMINISTRATIVE AGENT

         12.1 Appointment.  BOFA is hereby irrevocably appointed  Administrative
Agent  hereunder  and under each other Loan  Document,  and each of the  Lenders
irrevocably  authorizes  the  Administrative  Agent to act as the  agent of such
Lender.  The  Administrative  Agent  agrees  to act as  such  upon  the  express
conditions  contained in this Article  XII. The  Administrative  Agent shall not
have any duties or responsibilities  except those expressly set forth herein and
shall not have a  fiduciary  relationship  in respect of any Lender by reason of
this Agreement.

         12.2 Powers. The Administrative  Agent shall have and may exercise such
powers  under  the  Loan  Documents  as  are   specifically   delegated  to  the
Administrative Agent by the terms of each thereof,  together with such powers as
are  reasonably  incidental  thereto.  The  Administrative  Agent  shall have no
implied duties,  obligations or liabilities to the Lenders, or any obligation to
the  Lenders  to take any  action  thereunder  except  any  action  specifically
provided by the Loan  Documents to be taken by the  Administrative  Agent.  Only
Administrative  Agent  may  perform  the  duties  reserved  to it under the Loan
Documents  and no  Lender  shall  act or  purport  to act on behalf of the other
Lenders  or  Administrative  Agent on any such  matters.  Without  limiting  the
generality of the foregoing:

                  (a)  Administrative  Agent shall have the  exclusive  right to
collect from Borrower and any  Guarantor,  or third  parties,  on account of the
Facility,  including,   principal,   interest,  fees,  protective  advances  and
prepayment  premiums  (if any),  whether such sums are  received  directly  from
Borrower, Guarantor, or any other Persons, or are obtained by right of offset by
Administrative  Agent of any  kind,  or by  enforcement  of the Loan  Documents.
Administrative  Agent will receive and hold all collections  with respect to the
Loan for the benefit of the Lenders in accordance  with their  Percentages or as
otherwise provided herein.

                  (b) If any Lender  shall  receive any  payments or property in
connection with the Facility  (whether or not voluntary),  from any Person other
than  Administrative  Agent, such Lender shall transfer to Administrative  Agent
all such payments or property within one Business Day of receipt.

                  (c) No Lender shall independently initiate any judicial action
or other  proceeding  against  Borrower  or any  Guarantor  with  respect to the
Facility.

         12.3 General Immunity.  Neither the Administrative Agent nor any of its
directors,  officers, agents or employees shall be liable to the Borrower or the
Lenders for any action  taken or omitted to be taken by it or them  hereunder or
under any other Loan Document or in connection herewith or therewith, except for
its or their own gross negligence or willful misconduct.

         12.4  No  Responsibility   for  Loans,   Recitals,   etc.  Neither  the
Administrative  Agent nor any of its  directors,  officers,  agents or employees
shall be responsible for or have any duty to ascertain,  inquire into, or verify
(i) any statement,  warranty or representation  made in connection with any Loan
Document or any borrowing  hereunder;  (ii) the performance or observance of any
of the covenants or agreements of any obligor under any Loan Document; (iii) the
satisfaction  of any condition  specified in Article V, except  receipt of items
required to be  delivered to the  Administrative  Agent;  or (iv) the  validity,
effectiveness  or  genuineness  of any Loan Document or any other  instrument or
writing furnished in connection therewith.


<PAGE>




         12.5 Action on Instructions of Lenders.  The Administrative Agent shall
in all  cases be fully  protected  in  acting,  or in  refraining  from  acting,
hereunder  and  under  any  other  Loan  Document  in  accordance  with  written
instructions signed by the Majority Lenders and such instructions and any action
taken or failure to act pursuant  thereto shall be binding on all of the Lenders
and on all holders of Notes. The  Administrative  Agent shall be fully justified
in failing or  refusing  to take any action  hereunder  and under any other Loan
Document  unless it shall first  receive  such advise or  concurrence,  if it so
requests,  of the  Majority  Lenders  and  shall  first  be  indemnified  to its
satisfaction  by the Lenders pro rata  against any and all  liability,  cost and
expense  that it may incur by reason  of taking or  continuing  to take any such
action.

         12.6   Employment   of   Administrative   Agents   and   Counsel.   The
Administrative  Agent may  execute  any of its  duties as  Administrative  Agent
hereunder and under any other Loan Document by or through employees,  agents and
attorneys-in-fact and shall not be answerable to the Lenders, except as to money
or  securities  received  by it or its  authorized  agents,  for the  default or
misconduct  of  any  such  agents  or  attorneys-in-fact  selected  by  it  with
reasonable care. The  Administrative  Agent shall be entitled to engage and rely
upon advice of legal counsel  (including  the Borrower's  counsel),  independent
accountants and other  professionals and experts selected by the  Administrative
Agent  concerning  all matters  pertaining to the agency hereby  created and its
duties hereunder and under any other Loan Document.

         12.7 Reliance on Documents . The Administrative Agent shall be entitled
to rely  upon  any  Note,  writing,  notice,  consent,  certificate,  facsimile,
affidavit,  letter, telegram,  statement, paper, document or other communication
believed  by it to be  genuine  and  correct  and to have been  signed,  sent or
otherwise communicated by the proper person or persons.

         12.8  Administrative  Agent's  Reimbursement and  Indemnification.  The
Lenders agree to reimburse and indemnify  upon demand the  Administrative  Agent
ratably in accordance with their respective  Percentages (i) for any amounts not
reimbursed  by the  Borrower for which the  Administrative  Agent is entitled to
reimbursement  by the  Borrower  under  the Loan  Documents,  (ii) for any other
expenses  (including  attorneys' fees) incurred by the  Administrative  Agent on
behalf of the Lenders, in connection with the preparation,  execution, delivery,
administration,  modification and enforcement of the Loan Documents, if not paid
by  Borrower,  and  (iii) for any  liabilities,  obligations,  losses,  damages,
penalties,  actions,  judgments,  suits, costs, expenses or disbursements of any
kind and nature  whatsoever  which may be imposed  on,  incurred  by or asserted
against the  Administrative  Agent in any way  relating to or arising out of the
Loan  Documents or any other document  delivered in connection  therewith or the
transactions  contemplated  thereby,  or the  enforcement  of  any of the  terms
thereof or of any such other documents,  provided that no Lender shall be liable
for any of the  foregoing to the extent they arise from the gross  negligence or
willful misconduct of the Administrative  Agent. Each Lender shall indemnify the
Administrative Agent and the other Lenders with respect to claims,  liabilities,
damages, costs, losses and expenses (including,  without limitation,  attorneys'
fees)  arising  from or relating to the failure of such  indemnifying  Lender to
satisfy its obligations under this Agreement and the other Loan Documents.


         12.9 Rights as a Lender. With respect to the Commitment,  Advances made
by it, the Note issued to it and otherwise,  the Administrative Agent shall have
the same rights and powers  hereunder  and under any other Loan  Document as any
Lender and may exercise the same as though it were not the Administrative Agent,
and  the  term  "Lender"  or  "Lenders"  shall,  unless  the  context  otherwise
indicates,  include the  Administrative  Agent in its capacity as a Lender.  The
Administrative  Agent,  in its capacity as a Lender,  may accept  deposits from,
lend money to, and


<PAGE>




generally engage in any kind of trust,  debt,  equity or other  transaction,  in
addition to those  contemplated  by this  Agreement or any other Loan  Document,
with the  Borrower  or any of its  Subsidiaries  in which the  Borrower  or such
Subsidiary is not  restricted  hereby from  engaging with any other Person.  The
Lenders acknowledge that  Administrative  Agent and its Affiliates now or in the
future may have banking or other  financial  relationships,  including  being an
agent on other loans, with Borrower and its Affiliates,  as though BOFA were not
Administrative  Agent hereunder and without notice to or consent of the Lenders.
Each Lender  hereby  expressly  waives any objection to such actual or potential
conflict  of  interest.  The  Lenders  acknowledge  that in the  course  of such
activities, BOFA or its Affiliates may receive information regarding Borrower or
its  Affiliates  and  acknowledge  that  Administrative  Agent shall be under no
obligation to provide such information to them, whether or not confidential.

         12.10  Commitment  as a Lender.  BOFA agrees to maintain at all times a
Commitment  of at least 50 percent of the  Aggregate  Commitment so long as BOFA
remains as Administrative Agent; provided,  that the foregoing agreement of BOFA
shall not apply at any time  following  a  Monetary  Default or Event of Default
(irrespective of whether such Monetary Default or Event of Default  subsequently
is waived).

         12.11 Lender Credit Decision. Each Lender acknowledges that neither the
Administrative  Agent  nor any of its  agents  has  made any  representation  or
warranty to such Lender and that no action or statement  hereafter made or taken
by the  Administrative  Agent  or  any  of its  agents  shall  be  deemed  to be
representation  or warranty by the  Administrative  Agent to such Lenders.  Each
Lender further acknowledges that it has, independently and without reliance upon
the  Administrative  Agent  or any  other  Lender  and  based  on the  financial
statements  prepared by the Borrower and such other documents and information as
it has deemed  appropriate,  made its own credit  analysis and decision to enter
into this Agreement and the other Loan Documents.  Each Lender also acknowledges
that it will,  independently and without reliance upon the Administrative  Agent
or any other Lender and based on such documents and information as it shall deem
appropriate at the time,  continue to make its own credit analysis and decisions
in  taking  or not  taking  action  under  this  Agreement  and the  other  Loan
Documents.

         12.12  Successor  Administrative  Agent.  Each Lender  agrees that BOFA
shall  serve  as  Administrative  Agent  at all  times  during  the term of this
Facility,  except that BOFA may resign as  Administrative  Agent at any time, in
its sole discretion,  upon thirty (30) days' prior written notice to the Lenders
and Borrower.  Upon any such  resignation,  the Majority  Lenders shall have the
right to  appoint,  on behalf  of the  Borrower  and the  Lenders,  a  successor
Administrative  Agent. If no successor  Administrative  Agent shall have been so
appointed  by the  Majority  Lenders and shall have  accepted  such  appointment
within thirty (30) days after the retiring  Administrative Agent's giving notice
of resignation, then the retiring Administrative Agent may appoint, on behalf of
the Borrower and the Lenders, a successor  Administrative  Agent. Such successor
Administrative  Agent shall be a  commercial  bank having  capital and  retained
earnings of at least  $100,000,000.  Upon the  acceptance of any  appointment as
Administrative  Agent  hereunder  by  a  successor  Administrative  Agent,  such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights,  powers,  privileges  and duties of the retiring  Administrative
Agent  (including the right to receive any fees for performing such duties which
accrue thereafter),  and the retiring  Administrative  Agent shall be discharged
from its duties and  obligations  hereunder and under the other Loan  Documents.
After   any   retiring   Administrative   Agent's   resignation   hereunder   as
Administrative  Agent,  the  provisions  of this  Article XII shall  continue in
effect for its benefit  and that of the other  Lenders in respect of any actions
taken or  omitted  to be taken by it while it was  acting as the  Administrative
Agent hereunder and under the other Loan Documents.


<PAGE>




         12.13 Notice of  Defaults.  If a Lender  becomes  aware of a Default or
Event of Default,  such Lender  shall  notify the  Administrative  Agent of such
fact.  Upon  receipt  of such  notice  that a Default  or Event of  Default  has
occurred,  the  Administrative  Agent  shall  notify each of the Lenders of such
fact. Except for defaults in the payment of principal, interest and fees payable
to  Administrative  Agent  for  the  account  of  the  Lenders  and  such  other
Obligations  for  which  Administrative  Agent  is  expressly   responsible  for
determining Borrower's  compliance,  Administrative Agent shall not be deemed to
have  knowledge or notice of the  occurrence of any Default or Event of Default,
unless  Administrative Agent shall have received written notice from a Lender or
Borrower referring to the Loan,  describing such Default or Event of Default and
stating  that such notice is a "notice of  default".  Administrative  Agent will
notify the Lenders of its receipt of any such notice. Administrative Agent shall
take action with respect to such Default or Event of Default in accordance  with
the provisions of this Agreement and the Loan Documents.

         12.14 Requests for Approval.  If the  Administrative  Agent requests in
writing  the consent or  approval  of a Lender,  whether or not such  consent or
approval is required  hereunder (and no such requirement  shall be inferred from
any such  request),  such Lender shall respond and either  approve or disapprove
definitively  in writing to the  Administrative  Agent within seven (7) Business
Days  (or  sooner  if  such  notice   specifies  a  shorter   period   based  on
Administrative  Agent's good faith  determination that circumstances  warrant an
earlier response) after such written request from the  Administrative  Agent. If
any Lender does not so respond, that Lender shall be deemed to have approved the
request.  Upon request,  the Administrative Agent shall notify the Lenders which
Lenders, if any, failed to respond to a request for approval.

         12.15 Copies of Documents.  Administrative Agent shall promptly deliver
to each of the Lenders copies of all notices of default and other formal notices
sent to or received by the Administrative Agent pursuant to Section 15.1 of this
Agreement.  Within fifteen (15) Business Days after a request by a Lender to the
Administrative  Agent for other documents furnished to the Administrative  Agent
by the Borrower, the Administrative Agent shall provide copies of such documents
to such Lender except where this  Agreement  obligates  Administrative  Agent to
provide copies in a shorter period of time.

         12.16 Defaulting Lenders. At such time as a Lender becomes a Defaulting
Lender,  such Defaulting  Lender's right to vote on matters which are subject to
the consent or approval of the Majority  Lenders,  such Defaulting Lender or all
Lenders  shall be  immediately  suspended  until  such time as the  Lender is no
longer a  Defaulting  Lender.  If a  Defaulting  Lender  has  failed to fund its
Percentage  of any  Advance  and  until  such  time  as such  Defaulting  Lender
subsequently funds its Percentage of such Advance, all Obligations owing to such
Defaulting  Lender  hereunder  shall be  subordinated  in right of  payment,  as
provided  in the  following  sentence,  to the  prior  payment  in  full  of all
principal  of,  interest on and fees  relating to the Loans  funded by the other
Lenders in connection  with any such Advance in which the Defaulting  Lender has
not funded its Percentage (such  principal,  interest and fees being referred to
as "Senior  Loans" for the  purposes of this  section).  All amounts paid by the
Borrower  and  otherwise  due to be  applied  to the  Obligations  owing to such
Defaulting  Lender  pursuant to the terms  hereof  shall be  distributed  by the
Administrative  Agent to the other Lenders in accordance  with their  respective
Percentages  (recalculated  for the  purposes  hereof to exclude the  Defaulting
Lender)  until all  Senior  Loans  have been paid in full.  At that  point,  the
"Defaulting  Lender"  shall no longer be deemed a Defaulting  Lender.  After the
Senior  Loans  have  been  paid in full  equitable  adjustments  will be made in
connection  with future  payments by the Borrower to the extent a portion of the
Senior  Loans had been  repaid  with  amounts  that  otherwise  would  have been
distributed to a Defaulting Lender but for the operation of this Section 12.16.
This provision governs only the relationship among the


<PAGE>




Administrative  Agent,  each  Defaulting  Lender and the other Lenders;  nothing
hereunder  shall  limit the  obligation  of the  Borrower  to repay all Loans in
accordance  with the terms of this  Agreement.  The  provisions  of this Section
12.16 shall apply and be effective regardless of whether a Default occurs and is
continuing, and notwithstanding (i) any other provision of this Agreement to the
contrary,  (ii) any instruction of the Borrower as to its desired application of
payments or (iii) the  suspension of such  Defaulting  Lender's right to vote on
matters as provided above.

         12.17  Withholding Tax. All taxes due and payable on any payments to be
made  to  a  Lender  under  this   Agreement   shall  be  such   Lender's   sole
responsibility,  except to the extent  such  taxes are  actually  reimbursed  by
Borrower under the Loan Documents.  All payments to be made to each Lender under
this Agreement shall be made after deduction for any taxes,  charges,  levies or
withholdings which are imposed by the country of incorporation of Borrower,  the
United States of America or any other applicable taxing  authority.  Each Lender
agrees to provide to  Administrative  Agent  completed  and signed copies of any
forms that may be required by the United States  Internal  Revenue  Service (and
any applicable state authority) in order to certify such Lender's exemption from
or reduction  of United  States (or  applicable  state)  withholding  taxes with
respect to payments to be made to such Lender  under this  Agreement or the Loan
Documents.  Each Lender agrees to promptly  notify  Administrative  Agent of any
change which would modify or render invalid any claimed  exemption or reduction,
or of any sale, assignment,  participation,  or other transfer by such Lender of
all or part of its interest in the Facility.  If any  governmental  authority of
the United  States or other  jurisdiction  asserts a claim  that  Administrative
Agent did not  properly  withhold tax from amounts paid to or for the account of
any  Lender,  such Lender  shall  indemnify  Administrative  Agent fully for all
amounts paid by Administrative  Agent as tax or otherwise,  including  penalties
and interest,  and including any taxes imposed by any jurisdiction on the amount
payable to Administrative Agent under this section,  together with all costs and
expenses  (including legal  expenses).  The obligation of the Lenders under this
subsection  shall survive the payment of all  Obligations and the resignation or
replacement of Administrative Agent.

         12.18 Borrower's Default;  Enforcement. Upon the occurrence of an Event
of Default under any Loan Document,  the Majority  Lenders shall have the right,
upon written  notice to  Administrative  Agent,  to require that  Administrative
Agent  exercise the rights of the Lenders as directed by the  Majority  Lenders;
provided,  however,  that  the  Lenders  shall  indemnify,  exonerate  and  hold
Administrative  Agent  harmless  from and against  any and all  claims,  losses,
liabilities,  damages and costs  (including  reasonable  legal fees) incurred by
Administrative Agent as a result of any such exercise of rights at the direction
of the Lenders.

         12.19  Workout.  If  Borrower  is in  material  default  under the Loan
Documents  and has not cured the  default  within any  applicable  cure  period,
Administrative  Agent may declare by written notice to the Lenders that the Loan
is "in workout" (the "Notice of Workout"). The Lenders acknowledge that workouts
of  defaulted  loans  usually  are  resolved  by either a  borrower  cure of the
default; or a restructure of or other modification to the loan; or by exercising
remedies;  and that it is in the  interest of the Lenders to attain a resolution
within a reasonable period of time. Therefor the Lenders agree that if, after 90
days from the date of Administrative  Agent's Notice of Workout,  there has been
neither a cure of the  default(s),  nor a  restructure  nor  other  modification
executed,  nor exercise of the Lenders' remedies hereunder,  then Administrative
Agent on behalf  of the  Lenders  shall  sue  Borrower  and any  Guarantors  for
collection  of amounts owing to the Lenders,  subject to and in accordance  with
advice  of  Administrative  Agent's  counsel.   Notwithstanding  any  action  by
Administrative Agent under this Section 12.19, Administrative Agent shall follow
the  direction of the Majority  Lenders  under  Section 12.18 above at any time.
Nevertheless,  unless and until the Majority Lenders shall direct Administrative
Agent to the contrary, Administrative Agent shall have


<PAGE>




the right but not the obligation to take such action as it may deem  appropriate
to preserve  the rights of the  Lenders to recover  any amounts  owing under the
Loan Documents, without the consent of the Majority Lenders.

         12.20 Bankruptcy of Borrower. In the event of a bankruptcy by Borrower,
the Lenders shall act through  Administrative  Agent to petition the court, make
any motion for relief from the automatic  stay,  participate in any  appropriate
creditors' committee,  vote on a plan of reorganization or pursue other remedies
or actions in accordance with the approval of the Majority Lenders.

         12.21  Relationship  of  Parties.  This  Agreement  is not  intended to
establish a partnership or joint venture  between  Administrative  Agent and the
Lenders.  The provisions of the Loan Documents regarding the relationships among
Administrative  Agent and the Lenders and this Article XII is intended solely to
facilitate  co-lending  relationships  among the  Lenders for the  Facility.  No
security or investment contract under any federal or state law is intended to be
created among the Lenders or between  Administrative  Agent and the Lenders. The
execution of this  Agreement,  the  performance  of the terms  thereof,  and the
Lenders'  purchase  of and  ownership  interest  in the  Facility  and the  Loan
Documents  shall not constitute any Lender as owner,  purchaser or seller of any
security  (as  that  term  is  defined  in the  Securities  Act of  1933  or the
Securities Exchange Act of 1934) issued, owned, purchased or sole by BOFA or any
of its Subsidiaries or Affiliates, either as principal or as agent for Borrower.
Each Lender is  purchasing  and acquiring  legal and equitable  ownership of its
Percentage and is not making a loan to BOFA, and no debtor-creditor relationship
exists between them as a result of this Agreement.

         12.22 Counsel.  The Lenders  acknowledge  that  Administrative  Agent's
counsel has represented and shall  represent only  Administrative  Agent, in its
capacity  as  Administrative  Agent  and  Lender,  in  connection  with the Loan
Documents and this Agreement.  Each other Lender shall retain  independent legal
counsel regarding all such matters, documents and agreements.  After an Event of
Default,  the Lenders shall enter into a joint privilege agreement regarding the
exchange of information that is or may be subject to  attorney-client  privilege
or related privileges.  Administrative  Agent's counsel shall prepare such joint
privilege  agreement,  subject to the  approval of the  Majority  Lenders  which
approval shall not be unreasonably withheld by any Lender.

                                  ARTICLE XIII

                BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

         13.1     Successors and Assigns.

                  The  terms  and  provisions  of the  Loan  Documents  shall be
binding  upon and inure to the  benefit of  Borrower  and the  Lenders and their
respective  successors and assigns,  except that the Borrower shall not have the
right to assign its rights or obligations  under the Loan Documents  without the
consent of all the  Lenders  and any  assignment  by any Lender  must be made in
compliance  with Section 13.3. The  Administrative  Agent may treat the payee of
any Note as the owner  thereof  for all  purposes  hereof  unless and until such
payee complies with Section 13.3 in the case of an assignment thereof or, in the
case of any other  transfer,  a written notice of the transfer is filed with the
Administrative  Agent. Any assignee or transferee of a Note agrees by acceptance
thereof to be bound by all the terms and provisions of the Loan  Documents.  Any
request,  authority  or consent  of any  Person  who at the time of making  such
request or giving such authority or consent is the holder of any Note,  shall be
conclusive and binding on any subsequent holder,  transferee or assignee of such
Note or of any Note or Notes issued in exchange therefor.


<PAGE>





         13.2     Participations.

                  (a)  Permitted  Participants:  Effect.  Any Lender may, in the
         ordinary  course of its business and in accordance with applicable law,
         at  any  time   sell  to  one  or  more   banks   or   other   entities
         ("Participants")  participating  interests in any Advance owing to such
         Lender,  any Note held by such Lender, any Commitment of such Lender or
         any other  interest of such  Lender  under the Loan  Documents.  In the
         event of any such  sale by a Lender  of  participating  interests  to a
         Participant,  such Lender's  obligations under the Loan Documents shall
         remain  unchanged,  such Lender shall remain solely  responsible to the
         other parties  hereto for the  performance  of such  obligations,  such
         Lender shall remain the holder of any such Note for all purposes  under
         the  Loan  Documents,  all  amounts  payable  by  Borrower  under  this
         Agreement  shall be  determined  as if such  Lender  had not sold  such
         participating  interests, and Borrower and the Administrative Agent and
         the other Lenders shall  continue to deal solely and directly with such
         Lender in connection with such Lender's  rights and  obligations  under
         the Loan Documents.

                  (b) Voting Rights.  Each Lender shall retain the sole right to
         vote its Percentage of the Aggregate Commitment, without the consent of
         any  Participant,  for the approval or  disapproval  of any  amendment,
         modification or waiver of any provision of the Loan Documents, provided
         that such  Lender may grant such  Participant  the right to approve any
         amendment, modification or waiver which forgives principal, interest or
         fees or reduces the interest rate or fees payable hereunder,  postpones
         any date fixed for any  regularly-scheduled  payment of principal of or
         interest on the Obligations,  releases  Collateral  beyond any releases
         expressly provided for herein or extends the Maturity Date.

         13.3     Assignments.

                  (a)  Permitted  Assignments.  Any Lender  may,  with the prior
         written  consent of  Administrative  Agent and Borrower (which consents
         shall not be  unreasonably  withheld or delayed),  in  accordance  with
         applicable  law,  at any  time  assign  to one or more  banks  or other
         entities (collectively, "Purchasers") all or any part of its rights and
         obligations  under  the  Loan  Documents,  except  that no  consent  of
         Borrower  shall be required if any  Monetary  Default,  other  material
         Default or Event of Default has occurred and is continuing  and that no
         consent of Administrative  Agent or Borrower shall ever be required for
         (i) any  assignment  to a Person  directly or  indirectly  controlling,
         controlled  by or under  direct or  indirect  common  control  with the
         assigning  Lender or (ii) the pledge or  assignment by a Lender of such
         Lender's Note and other rights under the Loan  Documents to any Federal
         Reserve Bank in accordance with  applicable  law. Such  assignments and
         assumptions shall be substantially in the form of Exhibit H hereto. The
         Borrower  shall  execute any and all  documents  which are  customarily
         required by such Lender (including,  without limitation,  a replacement
         promissory note or notes in the forms provided hereunder) in connection
         with any such  assignment,  but Borrower  shall not be obligated to pay
         any fees and  expenses  incurred by any Lender in  connection  with any
         assignment pursuant to this Section. Any Lender selling all or any part
         of its rights and obligation  hereunder in a transaction  requiring the
         consent of the  Administrative  Agent  shall pay to the  Administrative
         Agent a fee of $3,500.00 per assignee to reimburse Administrative Agent
         for its involvement in such assignment.

                  (b)  Effective Date of Assignment. Upon delivery to the
         Administrative Agent of a


<PAGE>




         notice  of  assignment   executed  by  the  assigning  Lender  and  the
         Purchaser, such assignment shall become effective on the effective date
         specified in such notice of assignment.  The notice of assignment shall
         contain an undertaking by the Purchaser to be bound as a Lender by this
         Agreement and the other Loan  Documents  with the same force and effect
         as if it were an original signatory hereto, and a representation by the
         Purchaser to the effect that none of the consideration used to make the
         purchase of the Commitment and the Loan under the applicable assignment
         agreement  are "plan assets" as defined under ERISA and that the rights
         and interests of the Purchaser in and under the Loan Documents will not
         be "plan assets" under ERISA,  all in form and content  satisfactory to
         the  Administrative  Agent.  On and  after the  effective  date of such
         assignment,  such Purchaser shall for all purposes be a Lender party to
         this Agreement and any other Loan Document  executed by the Lenders and
         shall have all the rights and  obligations  of a Lender  under the Loan
         Documents,  to the same extent as if it were an original  party hereto,
         and no  further  consent  or action by  Borrower,  the  Lenders  or the
         Administrative Agent shall be required to release the transferor Lender
         with respect to the percentage of the Commitment and Advances  assigned
         to  such  Purchaser.  Upon  the  consummation  of any  assignment  to a
         Purchaser  pursuant to this Section 13.3.2,  the transferor Lender, the
         Administrative  Agent and Borrower shall make appropriate  arrangements
         so that replacement  Notes are issued to such transferor Lender and new
         Notes  or,  as  appropriate,  replacement  Notes,  are  issued  to such
         Purchaser,   in  each  case  in  principal  amounts   reflecting  their
         respective Commitments, as adjusted pursuant to such assignment.

         13.4 Dissemination of Information.  Borrower  authorizes each Lender to
disclose to any  Participant  or  Purchaser  or any other  Person  acquiring  an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective  Transferee  any and all  information  in such  Lender's  possession
concerning the creditworthiness of Borrower and the Guarantors.  Each Transferee
shall agree to keep  confidential  any such  information  which is not  publicly
available.

         13.5 Tax Treatment. If any interest in any Loan Document is transferred
to any Transferee  which is organized under the laws of any  jurisdiction  other
than the United States or any State thereof,  the transferor  Lender shall cause
such Transferee, concurrently with the effectiveness of such transfer, to comply
with all applicable provisions of the Code with respect to withholding and other
tax matters.

                                                    ARTICLE XIV

                                                GENERAL PROVISIONS

         14.1 Survival of  Representations.  All  representations and warranties
contained in this Agreement  shall survive  delivery of the Notes and the making
of the Advances herein contemplated.

     14.2 Governmental  Regulation.  Anything contained in this Agreement to the
contrary  notwithstanding,  no Lender shall be obligated to extend credit to the
Borrower  in  violation  of  any  limitation  or  prohibition  provided  by  any
applicable statute or regulation.

         14.3 Taxes. Any recording and other taxes (excluding franchise,  income
or similar  taxes) or other  similar  assessments  or  charges  payable or ruled
payable  by  any  governmental   authority   incurred  in  connection  with  the
consummation of the transactions contemplated by this Agreement shall be paid by
the Borrower, together with interest and penalties, if any.

     14.4 Headings.  Section  headings in the Loan Documents are for convenience
of  reference  only,  and  shall not  govern  the  interpretation  of any of the
provisions of the Loan Documents.


<PAGE>



     14.5 No Third Party Beneficiaries. This Agreement shall not be construed so
as to confer any right or benefit upon any Person other than the parties to this
Agreement and their respective successors and assigns.

         14.6  Expenses:  Indemnification.  Subject  to the  provisions  of this
Agreement,  Borrower will pay (a) all out-of-pocket  costs and expenses incurred
by the  Administrative  Agent  (including  the  reasonable  fees,  out-of-pocket
expenses  and  other  reasonable  expenses  of  counsel,  which  counsel  may be
employees of Administrative Agent) in connection with the preparation, execution
and delivery of this  Agreement,  the Notes,  the Loan  Documents  and any other
agreements  or  documents  referred  to herein  or  therein  and any  amendments
thereto, (b) all out-of-pocket costs and expenses incurred by the Administrative
Agent and the Lenders (including the reasonable fees, out-of-pocket expenses and
other  reasonable  expenses  of  counsel  to the  Administrative  Agent  and the
Lenders,  which counsel may be employees of Administrative Agent or the Lenders)
in connection  with the  enforcement and protection of the rights of the Lenders
under this  Agreement,  the Notes,  the Loan Documents or any other agreement or
document  referred to herein or therein,  and (c) all  reasonable  and customary
costs and expenses of periodic audits by the Administrative Agent's personnel of
the  Borrower's  books and records  provided  that prior to an Event of Default,
Borrower  shall not be required  to pay for more than one such audit  during any
year.  The Borrower  further agrees to indemnify the Lenders,  their  directors,
officers  and  employees  against  all  losses,  claims,   damages,   penalties,
judgments,  liabilities and reasonable expenses  (including,  without imitation,
all expenses of litigation or preparation therefor, whether or not any Lender is
a party  thereto)  which any of them may pay or incur arising out of or relating
to this  Agreement,  the other Loan  Documents,  the  transactions  contemplated
hereby or the direct or  indirect  application  or proposed  application  of the
proceeds of any Advance hereunder, except that the foregoing indemnity shall not
apply to a Lender to the extent that any losses,  claims, etc. are the result of
such Lender's gross  negligence or willful  misconduct.  The  obligations of the
Borrower under this Section shall survive the termination of this Agreement.

         14.7  Severability  of  Provisions.  Any provision in any Loan Document
that is held to be inoperative,  unenforceable,  or invalid in any  jurisdiction
shall,  as to that  jurisdiction,  be  inoperative,  unenforceable,  or  invalid
without  affecting  the  remaining   provisions  in  that  jurisdiction  or  the
operation,   enforceability,   or  validity  of  that  provision  in  any  other
jurisdiction,  and to this end the provisions of all Loan Documents are declared
to be severable.

         14.8 Nonliability of the Lenders. The relationship between the Borrower
and the  Lenders  shall be solely  that of  borrower  and  lender.  Neither  the
Administrative  Agent nor the Lenders shall have any fiduciary  responsibilities
to the  Borrower.  Neither the  Administrative  Agent nor the Lenders  undertake
responsibility to the Borrower to review or inform the Borrower of any matter in
connection with any phase of the Borrower's business or operations.

         14.9 Choice of Law. THE LOAN DOCUMENTS  (OTHER THAN THOSE  CONTAINING A
CONTRARY  EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS (AND NOT THE LAW OF  CONFLICTS) OF THE STATE OF ILLINOIS,  BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.

         14.10  Consent to Jurisdiction. THE BORROWER HEREBY IRREVOCABLY SUBMITS
TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR


<PAGE>




ILLINOIS  STATE COURT  SITTING IN CHICAGO,  ILLINOIS IN ANY ACTION OR PROCEEDING
ARISING  OUT OF OR  RELATING  TO ANY  LOAN  DOCUMENTS  AND THE  BORROWER  HEREBY
IRREVOCABLY  AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING  MAY
BE HEARD AND DETERMINED IN ANY SUCH COURT AND  IRREVOCABLY  WAIVES ANY OBJECTION
IT MAY NOW OR  HEREAFTER  HAVE AS TO THE  VENUE  OF ANY  SUCH  SUIT,  ACTION  OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT  FORUM.
NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE LENDERS TO BRING PROCEEDINGS AGAINST
THE BORROWER IN THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY
THE  BORROWER  AGAINST THE LENDERS OR ANY  AFFILIATE  OF THE LENDERS  INVOLVING,
DIRECTLY OR  INDIRECTLY,  ANY MATTER IN ANY WAY  ARISING OUT OF,  RELATED TO, OR
CONNECTED  WITH ANY LOAN  DOCUMENT  SHALL BE BROUGHT ONLY IN A COURT IN CHICAGO,
ILLINOIS.

         14.11 Waiver of Jury Trial. EACH OF THE BORROWER, ADMINISTRATIVE AGENT,
DOCUMENTATION AGENT AND LENDERS HEREBY KNOWINGLY,  VOLUNTARILY AND INTENTIONALLY
WAIVE ANY RIGHT THAT IT MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION ARISING IN
ANY WAY IN CONNECTION WITH THIS  AGREEMENT,  THE NOTES, OR ANY OF THE OTHER LOAN
DOCUMENTS,  THE LOAN,  OR ANY OTHER  STATEMENTS  OR ACTIONS OF ANY PARTY HERETO.
EACH SUCH ENTITY  ACKNOWLEDGES  THAT IT HAS BEEN  REPRESENTED  IN THE SIGNING OF
THIS  AGREEMENT  AND IN THE MAKING OF THIS WAIVER BY  INDEPENDENT  LEGAL COUNSEL
SELECTED OF ITS OWN FREE WILL,  AND THAT IT HAS DISCUSSED  THIS WAIVER WITH SUCH
LEGAL  COUNSEL.   BORROWER  FURTHER  ACKNOWLEDGES  THAT  (i)  IT  HAS  READ  AND
UNDERSTANDS THE MEANING AND  RAMIFICATIONS OF THIS WAIVER,  (ii) THIS WAIVER HAS
BEEN REVIEWED BY BORROWER AND  BORROWER'S  COUNSEL AND IS A MATERIAL  INDUCEMENT
FOR ADMINISTRATIVE AGENT AND LENDERS TO MAKE THE LOAN, ENTER INTO THIS AGREEMENT
AND EACH OF THE OTHER LOAN  DOCUMENTS,  AND (iii) THIS WAIVER SHALL BE EFFECTIVE
AS TO EACH OF SUCH OTHER LOAN DOCUMENTS AS IF FULLY INCORPORATED THEREIN.


--------------------------
INITIALS OF BORROWER

         14.12  Successors  and Assigns.  The terms and  provisions  of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their  respective  successors and assigns,  except that the Borrower
shall not have the  right to assign  its  rights or  obligations  under the Loan
Documents.  Any assignee or transferee of the Notes agrees by acceptance thereof
to be bound by all the terms and provisions of the Loan Documents.  Any request,
authority  or consent of any Person,  who at the time of making such  request or
giving such authority or consent is the holder of the Notes, shall be conclusive
and binding on any subsequent holder, transferee or assignee of such Notes or of
any note or notes issued in exchange therefor.

         14.13 Entire Agreement;  Modification of Agreement. The Loan Documents,
together with the letter from Borrower to Administrative Agent and Documentation
Agent  regarding the  underwriting  fee,  embody the entire  agreement among the
Borrower,  the  Administrative  Agent,  and  Lenders  and  supersede  all  prior
conversations, agreements, understandings, commitments and term sheets among any
or all of such parties with respect to the subject matter hereof. Any provisions
of


<PAGE>




this Agreement may be amended or waived, or any liability  thereunder  released,
if, but only if,  such  amendment  or waiver is in writing  and is signed by the
Borrower,  and  Administrative  Agent if the rights or duties of  Administrative
Agent are affected thereby, and

                  (a)      each of the Lenders, if such amendment or waiver

                           (i) reduces or forgives  any payment of  principal
                  or interest on the Obligations or any fees payable by Borrower
                  to such Lender hereunder; or

                           (ii)     postpones the date fixed for any payment of
                  principal of or interest on the Obligations or any fees
                  payable by Borrower to such Lender hereunder; or

                           (iii) changes the amount of such Lender's  Commitment
                  (other than pursuant to an assignment  permitted under Section
                  13.3) or the unpaid principal amount of such Lender's Note; or

                           (iv)     extends the Maturity Date;

                           (v)      changes the definition of Majority Lenders
                  or modifies any requirement for consent by each of the Lenders
                  under this Section 14.13(a); or

                           (vi)     release any Guarantor from the obligations
                  of any Guaranty.

                  (b)      the Administrative Agent, as to all other matters.

         14.14 Dealings with the Borrower.  The Lenders and their affiliates may
accept  deposits  from,  extend  credit to and  generally  engage in any kind of
banking,  trust or other  business with any of the Borrower or the Guarantors or
any of their Affiliates regardless of the capacity of the Lenders hereunder.

         14.15             Set-Off.

                  (a) If an Event of Default  shall have  occurred,  each Lender
shall have the right,  at any time and from time to time  without  notice to the
Borrower,  any such notice  being  hereby  expressly  waived,  to set-off and to
appropriate  or apply any and all  deposits  of money or  property  or any other
indebtedness  at any time held or owing by such  Lender to or for the  credit or
the  account  of  the  Borrower  against  and  on  account  of  all  outstanding
Obligations and all Obligations which from time to time may become due hereunder
and all other  obligations and liabilities of the Borrower under this Agreement,
irrespective of whether or not such Lender shall have made any demand  hereunder
and whether or not said obligations and liabilities shall have matured.

                  (b) Each Lender  agrees that if it shall,  by  exercising  any
right of set-off or counterclaim  or otherwise,  receive payment of a proportion
of the aggregate  amount of principal,  interest or fees due with respect to any
Note  held by it which is  greater  than the  proportion  received  by any other
Lender in respect of the  aggregate  amount of  principal,  interest or fees due
with respect to any Note held by such other Lender,  the Lender  receiving  such
proportionately  greater payment shall purchase such participations in the Notes
held by the other  Lenders  and such other  adjustments  shall be made as may be
required so that all such payments of  principal,  interest or Fees with respect
to the  Notes  held by the  Lenders  shall be  shared  by the  Lenders  pro rata
according to their respective Commitments.


<PAGE>





         14.16  Counterparts.  This  Agreement  may be executed in any number of
counterparts,  all of which taken together shall  constitute one agreement,  and
any of the  parties  hereto may  execute  this  Agreement  by  signing  any such
counterpart.  This Agreement shall be effective when it has been executed by the
Borrower and each of the Lenders shown on the signature pages hereof.

         14.17 Discretion.  In exercising any discretion  reserved herein to the
Administrative  Agent, the Majority Lenders or the Lenders,  the  Administrative
Agent, the Majority  Lenders or the Lenders,  as the case may be, shall exercise
such discretion in a manner which is commercially reasonable by the standards of
the  commercial  lending  industry  with  respect to credits  comparable  to the
Facility.

                                   ARTICLE XV

                                     NOTICES

         15.1 Giving Notice.  All notices and other  communications  provided to
any party hereto under this  Agreement  or any other Loan  Document  shall be in
writing or by telex or by facsimile  and addressed or delivered to such party at
its  address set forth below or at such other  address as may be  designated  by
such party in a notice to the other parties.  Any notice, if mailed and properly
addressed with postage prepaid, shall be deemed given when received; any notice,
if  transmitted  by telex or facsimile,  shall be deemed given when  transmitted
(answerback confined in the case of telexes). Notice may be given as follows:

                  To the Borrower:

                           Great Lakes REIT, L.P.
                           823 Commerce Drive
                           Suite 300
                           Oak Brook, Illinois 60523
                           Attention:  Jim Hicks
                           Telecopy:  (630) 368-2929


<PAGE>





                  With a copy to:

                           Ungaretti and Harris
                           Three First National Plaza
                           Suite 3500
                           Chicago, Illinois 60602
                           Attn: Rich Ungaretti
                           Telecopy: (312) 977-4405

                  To each Lender:

                           As shown below the Lender's signature.

                  To the Administrative Agent:

                         Bank of America National Trust and Savings Association
                           Commercial Real Estate Services
                           231 South LaSalle Street, 12th Floor
                           Chicago, Illinois 60697
                           Attention:  Dan Walsh
                           Telecopy:  (312) 974-4970

                  With a copy to:

                           Barack Ferrazzano Kirschbaum Perlman & Nagelberg
                           333 West Wacker Drive
                           Suite 2700
                           Chicago, Illinois 60606
                           Attention:  Howard J. Kirschbaum, Esq.
                           Telecopy:  (312) 984-3150

     15.2  Change of  Address.  Each party may change the address for service of
notice upon it by a notice in writing to the other parties hereto.



<PAGE>




         IN WITNESS WHEREOF,  the undersigned have executed this Agreement as of
the date first above written.

BORROWER:                     GREAT LAKES REIT, L.P.

                               By:  Great Lakes REIT, Inc., its General Partner


                               By:      /s/ James Hicks
                               Title:   Treasurer

LENDERS:                       BANK OF AMERICA NATIONAL TRUST AND
                               SAVINGS ASSOCIATION


                               By:      /s/ Katherine Snapp
                               Title:            Vice President
                               Commitment: $17,500,000
                               Percentage of Aggregate Commitment: 50%

                               Address for Notices:
                               Commercial Real Estate Services
                               231 South LaSalle Street, 12th Floor
                               Chicago, Illinois 60697
                               Attention: Dan Walsh
                               Telephone: (312) 828-5087
                               Telecopy:  (312) 974-4970

                               THE FIRST NATIONAL BANK OF CHICAGO


                               By:      /s/ Kevin L. Gillen
                               Title:            Assistant Vice President
                               Commitment: $17,500,000
                               Percentage of Aggregate Commitment: 50%

                               Address for Notices:
                               One First National Plaza
                               Chicago, Illinois 60670
                               Attention: Kevin Gillen
                               Telephone: (312) 732-1486
                               Telecopy:  (312) 732-1117

ADMINISTRATIVE AGENT:          BANK OF AMERICA NATIONAL TRUST AND
                               SAVINGS ASSOCIATION


                               By:      /s/ Katherine Snapp
                               Title:            Vice President



<PAGE>




                               Address for Notices:
                               Commercial Real Estate Services
                               231 South LaSalle Street, 12th Floor
                               Chicago, Illinois 60697
                               Attention: Dan Walsh
                               Telephone: (312) 828-5087
                               Telecopy:   (312) 974-4970


DOCUMENTATION AGENT:           THE FIRST NATIONAL BANK OF CHICAGO


                               By:      /s/ Kevin L. Gillen
                               Title:            Assistant Vice President

                               Address for Notices:
                               One First National Plaza
                               Chicago, Illinois 60670
                               Attention: Kevin Gillen
                               Telephone: (312) 732-1486
                               Telecopy:  (312) 732-1117




<PAGE>




                                                    SCHEDULE 1

                                               List of Subsidiaries




GLR No. 1, Inc. an Illinois corporation

GLR No. 2, Inc., an Illinois corporation

GLR No. 3, a Maryland real estate investment trust



<PAGE>




                                                    SCHEDULE 2

                                            List of Unencumbered Assets


         Name
Address

1.       Arlington Ridge Service Center

601 Campus Drive
Arlington Heights, IL

2.       3400 Corporate Drive

3400 Dundee Road
Northbrook, IL

3.       Highpoint Business Center

160, 165, 175, 180 and 185 Hansen Court
Wood Dale, IL
(5 buildings)
4.       1251 Plum Grove Road

1251 Plum Grove Road
Schaumburg, IL

5.       Park Place VII

11925 West Lake Park Drive
Milwaukee, WI

6.       1011 Touhy Atrium

1011 East Touhy Avenue
Des Plaines, IL

7.       One Hawthorn Place

175 East Hawthorn Parkway
Vernon Hills, IL

8.       Court Office Center

16601 S. Kedzie
Markham, IL

9.       One Century Centre

1750 East Golf Road
Schaumburg, IL

10.      Metro Center V

655 Metro Place South
Dublin, OH

11.      Corporate Woods

375 Bishops Way
Brookfield, WI

12.      Metro Center IV

425 Metro Place North
Dublin, OH

13.      Arlington Business Center

3455, 3550 and 3555 Salt Creek Lane
Arlington Heights, IL
(3 buildings)

14.      777 Eisenhower Plaza
777 Eisenhower Parkway
Ann Arbor, MI


<PAGE>




15.      11100 Hampshire Avenue1
11100 Hampshire Avenue
Bloomington, MN






<PAGE>




                                    EXHIBIT A


                                FORM OF GUARANTY

    This Guaranty made as of                 , 199__, by
("Guarantor"),  to and for the  benefit  of Bank of America  National  Trust and
Savings  Association,  individually as a lender  ("BOFA") and as  administrative
agent  ("Administrative  Agent") for itself and the other Lenders, as defined in
the Credit Agreement (as defined below), and The First National Bank of Chicago,
individually  as  a  lender  ("First   Chicago")  and  as  documentation   agent
("Documentation Agent"), and their respective successors and assigns.

                                                     RECITALS

         A. Great Lakes REIT, L.P. a Delaware limited  partnership  ("Borrower")
has  requested  that the Lenders make an  unsecured  revolving  credit  facility
available to Borrower in the  aggregate  principal  amount of up to  $35,000,000
("Facility"),  and that  Administrative  Agent act as  administrative  agent and
Documentation Agent act as documentation agent with respect thereto.

         B. The Lenders have agreed to make  available the Facility to Borrower,
and  Administrative  Agent and  Documentation  Agent have  agreed to act in said
agency  capacities,  pursuant  to the  terms  and  conditions  set  forth  in an
Unsecured  Revolving Credit Agreement dated January 6, 1998,  between  Borrower,
Administrative Agent,  Documentation Agent and the Lenders ("Credit Agreement"),
and  Guarantor  desires  that the Lenders  continue to make  Advances  under the
Credit Agreement and that Administrative  Agent and Documentation Agent continue
to act in said agency  capacities.  All capitalized terms used and not otherwise
defined herein shall have the respective  meanings ascribed to such terms in the
Credit Agreement.

         C.  Borrower  has  executed  and  delivered  to the Lenders one or more
promissory notes each dated January 6, 1998 in the aggregate principal amount of
$35,000,000 as evidence of its  indebtedness  to the Lenders with respect to the
Facility (the promissory notes described above,  together with any amendments or
allonges thereto, or restatements,  replacements or renewals thereof, and/or new
promissory  notes to new Lenders under the Credit  Agreement,  are  collectively
referred to herein as the "Revolving Note").

     D. Guarantor is deriving and will continue to derive substantial  financial
benefit from the Facility  evidenced by the Revolving Note, the Credit Agreement
and the other Loan Documents.

     E. The  execution  and  delivery of this  Guaranty by Guarantor is required
pursuant  to the express  terms of the Credit  Agreement  as a condition  to any
further Advances under the Facility.

                                   AGREEMENTS

         NOW,  THEREFORE,  in  consideration  of the  matters  described  in the
foregoing  Recitals,  which  Recitals  are  incorporated  herein and made a part
hereof, and for other good and valuable  consideration,  Guarantor hereby agrees
as follows:

     1. Guarantor  absolutely,  unconditionally,  and irrevocably  guarantees to
Administrative Agent and the Lenders:

                  (a)      the full and prompt payment of the principal of and
interest on the Revolving


<PAGE>




         Note when  due,  whether  at  stated  maturity,  upon  acceleration  or
         otherwise,  and at all times thereafter,  and the prompt payment of all
         other sums which may now be or may hereafter become due and owing under
         the  Revolving  Note,  the  Credit  Agreement  and/or  the  other  Loan
         Documents;

                  (b) the payment of all Enforcement Costs (as hereinafter
         defined); and

                  (c) the full, complete, and punctual observance,  performance,
         and  satisfaction of all of the  obligations,  duties,  covenants,  and
         agreements  of  Borrower  under  the  Credit  Agreement  and  the  Loan
         Documents.

All amounts  due,  debts,  liabilities,  and payment  obligations  described  in
subparagraphs  (a) and (b) of this  Paragraph  1 are  referred  to herein as the
"Facility Indebtedness.  " All obligations described in subparagraph (c) of this
Paragraph 1 are referred to herein as the "Obligations."

         2. In the event of any  default by  Borrower  in making  payment of the
Facility Indebtedness,  or in performance of the Obligations,  Guarantor agrees,
on demand by Administrative  Agent, to pay all the Facility  Indebtedness and to
perform all the Obligations as are or then or thereafter become due and owing or
are to be performed under the terms of the Revolving Note, the Credit  Agreement
and/or the other Loan Documents,  and to pay any reasonable expenses incurred by
Administrative  Agent or the Lenders in protecting,  preserving or defending its
interest in the Property or any  collateral  for the  Facility,  or otherwise in
connection  with the  Facility  or under any of the Loan  Documents,  including,
without  limitation,  all reasonable  attorneys' fees and costs.  Administrative
Agent  shall have the  right,  at its  option,  either  before,  during or after
pursuing any other right or remedy against Borrower or Guarantor, to perform any
and all of the Obligations by or through any agent, contractor or subcontractor,
or any of their agents,  of its selection,  all as  Administrative  Agent in its
sole   discretion   deems  proper,   and  Guarantor  shall  indemnify  and  hold
Administrative  Agent and the Lenders free and harmless from and against any and
all loss, damage,  cost, expense,  injury, or liability  Administrative Agent or
the Lenders may suffer or incur in  connection  with the  exercise of its rights
under this Guaranty or the performance of the Obligations,  except to the extent
the same arises as a result of the gross  negligence  or willful  misconduct  of
Administrative Agent.

         All of the remedies set forth herein and/or provided by any of the Loan
Documents or law or equity shall be equally  available to  Administrative  Agent
for the  benefit of itself  and the  Lenders,  and the choice by  Administrative
Agent of one such  alternative  over another shall not be subject to question or
challenge  by  Guarantor  or any other  person,  nor  shall  any such  choice be
asserted  as a defense,  set-off or failure to  mitigate  damages in any action,
proceeding or  counteraction by  Administrative  Agent for the benefit of itself
and/or the Lenders to recover or seeking any other remedy  under this  Guaranty,
nor shall such choice preclude  Administrative Agent from subsequently  electing
to  exercise a different  remedy.  The  parties  have agreed to the  alternative
remedies hereinabove specified in part because they recognize that the choice of
remedies  in the  event of a  failure  hereunder  will  necessarily  and  should
properly be a matter of  business  judgment,  which,  with  hindsight  after the
passage of time and events, may or may not prove to have been the best choice to
maximize  recovery  by  Administrative  Agent for the  benefit of itself and the
Lenders at the lowest cost to Borrower and/or Guarantor.  It is the intention of
the parties that such choice by Administrative  Agent be given conclusive effect
regardless of such subsequent developments.

     3. Guarantor does hereby waive (i) notice of acceptance of this Guaranty by
Administrative Agent or the Lenders and any and all notices and demands of every
kind which may


<PAGE>




be required to be given by any statute, rule or law, (ii) any defense,  right of
set-off or other claim which  Guarantor  may have  against the Borrower or which
Guarantor  or  Borrower  may  have  against  Administrative  Agent or any of the
Lenders or the holder of the  Revolving  Note,  (iii)  presentment  for payment,
demand  for  payment,  notice of  nonpayment,  dishonor,  protest  and notice of
protest,  diligence in collection and any and all  formalities  which  otherwise
might be legally required to charge  Guarantor with liability,  (iv) any failure
by  Administrative  Agent or any of the Lenders to inform Guarantor of any facts
Administrative  Agent or any of the  Lenders  may now or  hereafter  know  about
Borrower,  the  Facility,  or  the  transactions   contemplated  by  the  Credit
Agreement,  it being  understood  and agreed that  Administrative  Agent and the
Lenders have no duty so to inform and that  Guarantor is fully  responsible  for
being and  remaining  informed by Borrower of all  circumstances  bearing on the
existence or creation or risk of nonpayment of the Facility  Indebtedness or the
risk of nonperformance of the Obligations,  and (v) any and all right to cause a
marshaling  of  assets  of the  Borrower  or any  other  action  by any court or
governmental body with respect thereto, or to cause  Administrative Agent or any
of the Lenders to proceed  against any other  security  given to  Administrative
Agent or any of the Lenders in connection with the Facility  Indebtedness or the
Obligations.  Credit may be granted or continued from time to time by Lenders to
Borrower  without notice to or authorization  from Guarantor,  regardless of the
financial  or other  condition  of  Borrower  at the  time of any such  grant or
continuation.  Guarantor  acknowledges  that  no  representations  of  any  kind
whatsoever  have  been made by  Administrative  Agent or any of the  Lenders  to
Guarantor.  No  modification or waiver of any of the provisions of this Guaranty
shall be binding upon  Administrative  Agent or the Lenders  except as expressly
set forth in a writing  duly signed and  delivered  on behalf of  Administrative
Agent and the Lenders.

         4.  Guarantor  further agrees that  Guarantor's  liability as guarantor
shall in nowise be impaired by any renewals or extensions which may be made from
time to time,  with or without the knowledge or consent of Guarantor of the time
for  payment  of  interest  or  principal  under  the  Revolving  Note or by any
forbearance  or delay in  collecting  interest or principal  under the Revolving
Note, or by any waiver under the Credit  Agreement or any other Loan  Documents,
or by failure or election not to pursue any other remedies against Borrower,  or
by any change or modification in the Revolving Note, the Credit Agreement or any
other Loan  Documents,  or by the acceptance of any  additional  security or any
increase,  substitution or change therein,  or by the release of any security or
any withdrawal  thereof or decrease  therein,  or by the application of payments
received  from any  source  to the  payment  of any  obligation  other  than the
Facility  Indebtedness,  even though  Administrative  Agent or the Lenders might
lawfully  have elected to apply such payments to any part or all of the Facility
Indebtedness,  it being the intent hereof that Guarantor  shall remain liable as
principal  for  payment of the  Facility  Indebtedness  and  performance  of the
Obligations  until all  indebtedness  has been paid in full and the other terms,
covenants and  conditions of the Credit  Agreement and other Loan  Documents and
this Guaranty have been performed,  notwithstanding any act or thing which might
otherwise  operate  as a legal or  equitable  discharge  of a surety.  Guarantor
further understands and agrees that Administrative  Agent and the Lenders may at
any time enter into  agreements  with Borrower to amend and modify the Revolving
Note,  Credit  Agreement or other Loan  Documents,  and may waive or release any
provision or provisions  thereof,  and, with reference to such instruments,  may
make and enter into any such  agreement or agreements as  Administrative  Agent,
the Lenders and  Borrower may deem proper and  desirable,  without in any manner
impairing this Guaranty or any of Administrative  Agent's or the Lenders' rights
hereunder or any of the Guarantor's obligations hereunder.

     5. This is an absolute,  unconditional,  complete,  present and  continuing
guaranty of payment  and  performance,  and not of  collection  only.  Guarantor
agrees  that this  Guaranty  may be  enforced  by  Administrative  Agent and the
Lenders without the necessity at any time of resorting to


<PAGE>




or exhausting any other security or collateral  given in connection  herewith or
with the  Facility  or any of the Loan  Documents,  or  resorting  to any  other
guaranties,  and  Guarantor  hereby  waives the right to require  Administrative
Agent or the Lenders to join  Borrower  in any action  brought  hereunder  or to
commence any action against or obtain any judgment against Borrower or to pursue
any other  remedy or enforce  any other  right.  Guarantor  further  agrees that
nothing contained herein or otherwise shall prevent Administrative Agent and the
Lenders  from  pursuing  concurrently  or  successively  all rights and remedies
available to it at law and/or in equity or under any of the Loan Documents,  and
the exercise of any of its rights or the completion of any of its remedies shall
not constitute a discharge of any of Guarantor's obligations hereunder, it being
the purpose and intent of Guarantor that the obligations of Guarantor  hereunder
shall be primary,  absolute,  independent  and  unconditional  under any and all
circumstances  whatsoever.  Neither Guarantor's  obligations under this Guaranty
nor any remedy for the enforcement thereof shall be impaired,  modified, changed
or released in any manner  whatsoever by any impairment,  modification,  change,
release or limitation of the liability of Borrower under the Revolving Note, the
Credit  Agreement  or any  other  Loan  Documents  or by  reason  of  Borrower's
bankruptcy or by reason of any creditor or bankruptcy  proceeding  instituted by
or against Borrower.  This Guaranty shall continue to be effective and be deemed
to have  continued in existence or be reinstated  (as the case may be) if at any
time  payment of all or any part of any sum payable  pursuant  to the  Revolving
Note, the Credit  Agreement or any other Loan Document is rescinded or otherwise
required  to be  returned  by the  payee  upon the  insolvency,  bankruptcy,  or
reorganization  of the  payer,  all as though  such  payment  had not been made,
regardless of whether  Administrative  Agent or any of the Lenders contested the
order  requiring  the  return of such  payment.  The  obligations  of  Guarantor
pursuant to the preceding  sentence shall survive any termination,  cancellation
or release of this Guaranty.

         6.  This  Guaranty  shall be  assignable  by Agents  and/or  any of the
Lenders to any  assignee  of all or a portion  of Agents  and/or  such  Lender's
rights under the Loan Documents.

         7. If: (i) this Guaranty,  the Revolving Note, the Credit  Agreement or
any other Loan Document is placed in the hands of an attorney for  collection or
is  collected  through  any legal  proceeding;  (ii) an  attorney is retained to
represent  Administrative  Agent  and/or any of the  Lenders in any  bankruptcy,
reorganization,  receivership,  or other proceedings affecting creditors' rights
and  involving a claim  under this  Guaranty,  the  Revolving  Note,  the Credit
Agreement or any Loan Document;  (iii) an attorney is retained to provide advice
or other representation with respect to the Loan Documents in connection with an
enforcement  action or  potential  enforcement  action;  or (iv) an  attorney is
retained  to  represent  Administrative  Agent  and/or any of the Lenders in any
other  legal  proceedings  whatsoever  in  connection  with this  Guaranty,  the
Revolving  Note,  the Credit  Agreement,  any of the other Loan Documents or any
property subject thereto,  then Guarantor shall pay to Administrative Agent upon
demand all reasonable  attorney's fees, costs and expenses,  including,  without
limitation,  court costs,  filing fees,  recording costs and all other costs and
expenses whatsoever incurred in connection  therewith (all of which are referred
to herein  as  "Enforcement  Costs"),  in  addition  to all  other  amounts  due
hereunder.

         8. The parties  hereto  intend  that each  provision  in this  Guaranty
comports  with all  applicable  local,  state  and  federal  laws  and  judicial
decisions.  However,  if any provision or  provisions,  or if any portion of any
provision  or  provisions,  in this  Guaranty  is found by a court of  competent
jurisdiction  to be in  violation  of any  applicable  local,  state or  federal
ordinance,  statute, law, administrative or judicial decision, or public policy,
and if such court should  declare such portion,  provision or provisions of this
Guaranty to be illegal,  invalid,  unlawful,  void or  unenforceable as written,
then it is the intent of all parties  hereto  that such  portion,  provision  or
provisions  shall be given  force to the fullest  possible  extent that they are
legal, valid and


<PAGE>




enforceable,  that the remainder of this Guaranty  shall be construed as if such
illegal,  invalid,   unlawful,  void  or  unenforceable  portion,  provision  or
provisions  were not contained  therein,  and that the rights,  obligations  and
interest of Administrative Agent, the Lenders and the holder(s) of the Revolving
Note under the  remainder  of this  Guaranty  shall  continue  in full force and
effect.

         9. Any indebtedness of Borrower to Guarantor now or hereafter  existing
is hereby subordinated to the Facility Indebtedness. Guarantor agrees that until
the entire Facility  Indebtedness  has been paid in full, (i) Guarantor will not
seek, accept or retain for Guarantor's own account, any payment from Borrower on
account of such  subordinated  debt,  and (ii) any such payments to Guarantor on
account of such  subordinated  debt shall be collected and received by Guarantor
in trust  for  Administrative  Agent and the  Lenders  and shall be paid over to
Administrative  Agent on account of the Facility  Indebtedness without impairing
or releasing the obligations of Guarantor hereunder.

         10.  Guarantor  waives and releases any claim (within the meaning of 11
U.S.C.  Para.  101) which  Guarantor  may have against  Borrower  arising from a
payment made by Guarantor  under this  Guaranty and agrees not to assert or take
advantage of any subrogation  rights of Guarantor,  Administrative  Agent or the
Lenders  or any  right of  Guarantor,  Administrative  Agent or the  Lenders  to
proceed against (i) Borrower for  reimbursement,  or (ii) any other guarantor or
any  collateral  security or guaranty or right of offset held by  Administrative
Agent  or  the  Lenders  for  the  payment  of  the  Facility  Indebtedness  and
performance of the Obligations,  nor shall Guarantor seek or be entitled to seek
any  contribution  or  reimbursement  from  Borrower or any other  guarantor  in
respect of payments made by Guarantor hereunder. It is expressly understood that
the waivers and  agreements of Guarantor set forth above  constitute  additional
and cumulative benefits given to Administrative  Agent and the Lenders for their
security  and as an  inducement  for  their  continuing  extension  of credit to
Borrower.

         11. Any  amounts  received by  Administrative  Agent or Lender from any
source on account of any  indebtedness  may be applied by  Administrative  Agent
toward the payment of such  indebtedness,  and in such order of application,  as
Administrative Agent may from time to time elect.

         12. This  Guaranty  shall be governed by the internal laws of the State
of  Illinois,  without  regard to its  choice of law rules or  conflict  of laws
principles.  The Guarantor hereby submits to personal  jurisdiction in the State
of Illinois for the enforcement of this Guaranty and waives any and all personal
rights to object to such  jurisdiction for the purposes of litigation to enforce
this  Guaranty.  Guarantor  hereby  consents to the  jurisdiction  of either the
Circuit Court of Cook County,  Illinois, or the United States District Count for
the Northern  District of Illinois,  in any action,  suit, or  proceeding  which
Administrative  Agent or the Lenders may at any time wish to file in  connection
with this  Guaranty  or any  related  matter.  Guarantor  hereby  agrees that an
action, suit, or proceeding to enforce this Guaranty may be brought in any state
or federal court in the State of Illinois and hereby waives any objection  which
Guarantor  may have to the  laying of the  venue of any such  action,  suit,  or
proceeding in any such court;  provided,  however,  that the  provisions of this
Paragraph  shall not be deemed to preclude  Administrative  Agent or the Lenders
from filing any such action, suit, or proceeding in any other appropriate forum.

         13. All notices and other  communications  provided to any party hereto
under  this  Agreement  or any other  Loan  Document  shall be in  writing or by
facsimile  and  addressed  or  delivered  to such party at its address set forth
below or at such other address as may be designated by such party in a notice to
the other  parties.  Any notice,  if mailed and properly  addressed with postage
prepaid,  shall be deemed given when  received;  any notice,  if  transmitted by
facsimile,  shall be  deemed  given  when  transmitted.  Notice  may be given as
follows:


<PAGE>




                  To the Guarantor:




                           Attention:
                           Telecopy:

                  With a copy to:




                           Attention:
                           Telecopy:

                  To the Administrative Agent or the Lenders:

                          Bank of America National Trust and Savings Association
                           231 S. LaSalle Street, 12th Floor
                           Chicago, Illinois 60697
                           Attention:  Dan Walsh
                           Telecopy:  (312) 974-4970

                  With a copy to:

                           Barack Ferrazzano Kirschbaum Perlman & Nagelberg
                           333 W. Wacker Drive, Suite 2700
                           Chicago, Illinois 60606
                           Attention: Howard J. Kirschbaum, Esq.
                           Telecopy:  (312) 984-3150

or at such  other  address  as the  party  to be  served  with  notice  may have
furnished in writing to the party seeking or desiring to serve notice as a place
for the service of notice.

         14.  Guarantors  and  Lender  agree that such  Guarantor's  obligations
hereunder  shall not exceed the  greater  of:  (i) the  aggregate  amount of all
monies received,  directly or indirectly,  by such Guarantor from Borrower after
the date hereof (whether by loan,  capital infusion or other means), or (ii) the
maximum amount not subject to avoidance under Title 11 of the United State Code,
as same may be  amended  from  time to time,  or any  applicable  state law (the
"Bankruptcy  Code"). To that end, to the extent such obligations would otherwise
be subject to  avoidance  under the  Bankruptcy  Code if such  Guarantor  is not
deemed  to have  received  valuable  consideration,  fair  value  or  reasonably
equivalent value for its obligations hereunder, any such Guarantor's obligations
hereunder  shall be reduced to that amount which,  after giving effect  thereto,
would not render  such  Guarantor  insolvent,  or leave such  Guarantor  with an
unreasonably  small capital to conduct its  business,  or cause the Guarantor to
have incurred  debts (or intended to have incurred  debts) beyond its ability to
pay such debts as they  mature,  as such terms are  determined,  and at the time
such obligations are deemed to have been incurred, under the Bankruptcy Code. In
the event any Guarantor  shall make any payment or payments under this Guaranty,
each other Guarantor shall  contribute to such paying  Guarantor an amount equal
to such non-paying Guarantor's pro rata share


<PAGE>




(based on their  respective  maximum  liabilities  hereunder) of such payment or
payments made by such paying Guarantor,  provided that such  contribution  right
shall  be  subordinate  and  junior  in  right of  payment  to all the  Facility
Indebtedness and performance of all of the Obligations to Lender.

         14. This Guaranty shall be binding upon the heirs, executors, legal and
personal representatives, successors and assigns of Guarantor and shall inure to
the  benefit of  Administrative  Agent's,  Documentation  Agent's  and  Lender's
successors and assigns.

     15. This Guaranty  shall be construed and enforced  under the internal laws
of the State of Illinois.

         16. EACH GUARANTOR  HEREBY  KNOWINGLY,  VOLUNTARILY  AND  INTENTIONALLY
WAIVE ANY RIGHT THAT IT MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION ARISING IN
ANY WAY IN CONNECTION  WITH THIS GUARANTY,  OR ANY OF THE OTHER LOAN  DOCUMENTS,
THE LOAN, OR ANY OTHER STATEMENTS OR ACTIONS OF ANY PARTY HERETO. EACH GUARANTOR
ACKNOWLEDGES THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS GUARANTY AND IN
THE MAKING OF THIS WAIVER BY INDEPENDENT  LEGAL COUNSEL SELECTED OF ITS OWN FREE
WILL, AND THAT IT HAS DISCUSSED  THIS WAIVER WITH SUCH LEGAL COUNSEL.  GUARANTOR
FURTHER  ACKNOWLEDGES  THAT (i) IT HAS  READ AND  UNDERSTANDS  THE  MEANING  AND
RAMIFICATIONS  OF THIS WAIVER,  (ii) THIS WAIVER HAS BEEN  REVIEWED BY GUARANTOR
AND GUARANTOR'S  COUNSEL AND IS A MATERIAL  INDUCEMENT FOR ADMINISTRATIVE  AGENT
AND LENDERS TO MAKE THE LOAN,  ENTER INTO THE CREDIT  AGREEMENT  AND EACH OF THE
OTHER LOAN  DOCUMENTS,  AND (iii) THIS WAIVER  SHALL BE  EFFECTIVE AS TO EACH OF
SUCH OTHER LOAN DOCUMENTS AS IF FULLY INCORPORATED THEREIN.

         IN WITNESS  WHEREOF,  Guarantor has  delivered  this Guaranty as of the
date first written above.




                                                     By:
                                                          Its:


<PAGE>




STATE OF                            )
                                    )  SS.
COUNTY OF                           )

         I, the  undersigned,  a Notary Public,  in and for said County,  in the
State aforesaid, DO HEREBY CERTIFY, that , the of , personally known to me to be
the same person whose name is subscribed to the foregoing  instrument,  appeared
before me this day in person and  acknowledged  that he signed and delivered the
said  instrument as his own free and voluntary act and as the free and voluntary
act of said corporation, for the uses and purposes therein set forth.

GIVEN under my hand and Notarial Seal, this       day of           , 199    .




                                                Notary Public




<PAGE>




                                    EXHIBIT B
                             FORM OF REVOLVING NOTE


                                 PROMISSORY NOTE


$                                                            January ____, 1998


         On or before the Maturity  Date,  as defined in that certain  Unsecured
Revolving Credit Agreement dated as of January 6, 1998 (the "Agreement") between
Great Lakes REIT, L.P., a Delaware limited partnership corporation ("Borrower"),
Bank of America  National  Trust and Savings  Association,  individually  and as
Administrative  Agent  for  the  Lenders  (as  such  terms  are  defined  in the
Agreement),   The  First   National  Bank  of  Chicago,   individually   and  as
Documentation  Agent ("First Chicago") and the other Lenders,  Borrower promises
to pay to the  order of (the  "Lender"),  or its  successors  and  assigns,  the
principal  sum of AND NO/100  DOLLARS  ($ ) or the  aggregate  unpaid  principal
amount of all Loans made by the Lender to  Borrower  pursuant  to Section 2.1 of
the Agreement,  in immediately  available funds to the account, or at the office
of,  Administrative  Agent specified in Section 2.11 of the Agreement,  together
with  interest  on the unpaid  principal  amount  hereof at the rates and on the
dates set forth in the Agreement.  The Borrower shall pay this  Promissory  Note
("Note") in full on or before the Maturity Date in accordance  with the terms of
the Agreement.

    The  Lender  shall,  and is hereby  authorized  to,  record on the  schedule
attached  hereto,  or to otherwise record in accordance with its usual practice,
the date and  amount  of each  Loan and the date and  amount  of each  principal
payment hereunder.

    This Note is issued  pursuant to, and is entitled to the security  under and
benefits of, the Agreement and the other Loan Documents,  to which Agreement and
Loan  Documents,  as they may be amended from time to time,  reference is hereby
made for, inter alia, a statement of the terms and  conditions  under which this
Note may be prepaid or its maturity  date  accelerated.  Capitalized  terms used
herein and not otherwise defined herein are used with the meanings attributed to
them in the Agreement.

    If there is an Event of Default or Default  under the Agreement or any other
Loan  Document and Lender  exercises its remedies  provided  under the Agreement
and/or any of the Loan Documents, then in addition to all amounts recoverable by
the Lender under such documents,  Lender shall be entitled to receive reasonable
attorneys fees and expenses incurred by Lender in exercising such remedies.

    Borrower and all endorsers severally waive presentment,  protest and demand,
notice of protest, demand and of dishonor and nonpayment of this Note (except as
otherwise  expressly  provided  for in the  Agreement),  and any and all lack of
diligence or delays in collection  or  enforcement  of this Note,  and expressly
agree that this Note,  or any payment  hereunder,  may be extended  from time to
time,  and  expressly  consent  to the  release  of any  party  liable  for  the
obligation  secured by this Note,  the  release of any of the  security  of this
Note, the acceptance of any other security therefor,  or any other indulgence or
forbearance  whatsoever,  all without notice to any party and without  affecting
the liability of the Borrower and any endorsers hereof.



<PAGE>




         This Note shall be governed and  construed  under the internal  laws of
the State of Illinois.

BORROWER  AND  LENDER,  BY  ITS  ACCEPTANCE   HEREOF,   EACH  HEREBY  KNOWINGLY,
VOLUNTARILY  AND  INTENTIONALLY  WAIVE ANY RIGHT  THAT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LITIGATION  ARISING IN ANY WAY IN CONNECTION  WITH THIS NOTE, OR ANY
OF THE OTHER LOAN DOCUMENTS, THE LOAN, OR ANY OTHER STATEMENTS OR ACTIONS OF ANY
PARTY HERETO.  BORROWER ACKNOWLEDGES THAT IT HAS BEEN REPRESENTED IN THE SIGNING
OF THIS NOTE AND IN THE  MAKING  OF THIS  WAIVER BY  INDEPENDENT  LEGAL  COUNSEL
SELECTED OF ITS OWN FREE WILL,  AND THAT IT HAS DISCUSSED  THIS WAIVER WITH SUCH
LEGAL  COUNSEL.   BORROWER  FURTHER  ACKNOWLEDGES  THAT  (i)  IT  HAS  READ  AND
UNDERSTANDS THE MEANING AND  RAMIFICATIONS OF THIS WAIVER,  (ii) THIS WAIVER HAS
BEEN REVIEWED BY BORROWER AND  BORROWER'S  COUNSEL AND IS A MATERIAL  INDUCEMENT
FOR LENDER TO MAKE THE LOAN, ENTER INTO THE AGREEMENT AND EACH OF THE OTHER LOAN
DOCUMENTS,  AND (iii) THIS WAIVER  SHALL BE  EFFECTIVE  AS TO EACH OF SUCH OTHER
LOAN DOCUMENTS AS IF FULLY INCORPORATED THEREIN.

                            GREAT LAKES REIT, L.P.

                            By:      Great Lakes REIT, Inc., its general partner

                            By:

                            Its:






<PAGE>




                                                LOANS AND PAYMENTS




Date


Loan

Principal
Payments
Unpaid
Principal
Balance

Notation
Made By




































<PAGE>




                                                     EXHIBIT C

                                           OPINION OF BORROWER'S COUNSEL


                                                 (Attached Hereto)





<PAGE>




                                                     EXHIBIT D

                                          OPINION OF GUARANTORS' COUNSEL


                                          See Exhibit C attached hereto.



<PAGE>




                                                     EXHIBIT E

                                                WIRING INSTRUCTIONS

To:      Bank of America National Trust and Saving Association,
         as Administrative Agent (the "Administrative Agent") under the Credit
         Agreement described below

         Re:      Unsecured  Revolving Credit Agreement,  dated as of January 6,
                  1998 (as amended,  modified,  renewed or extended from time to
                  time,  the  "Agreement"),  among Great Lakes REIT,  L.P.  (the
                  "Borrower"), Administrative Agent, the Documentation Agent and
                  the Lenders named therein. Terms used herein and not otherwise
                  defined  shall  have  the  meanings  assigned  thereto  in the
                  Agreement.

    The Administrative Agent is specifically authorized and directed to act upon
the following standing money transfer  instructions with respect to the proceeds
of Advances or other extensions of credit from time to time until receipt by the
Administrative  Agent of a specific written  revocation of such  instructions by
the Borrower, provided, however, that the Administrative Agent may also transfer
funds as  hereafter  directed  in writing by the  Borrower  in  accordance  with
Section 15.1 of the Agreement.

Facility Identification Number(s)


Customer/Account Name


Transfer Funds To




For Account No.


Reference/Attention To


Authorized Officer (Customer Representative)                         Date




(Please Print)                                                       Signature

Bank Officer Name                                                    Date






<PAGE>




(Please Print)                                                Signature

    (Deliver Completed Form to Credit Support Staff For Immediate Processing)



<PAGE>




                                    EXHIBIT F

                         FORM OF COMPLIANCE CERTIFICATE

To:      The Administrative Agent and the Lenders
         who are parties to the Agreement described below

    This Compliance  Certificate is furnished pursuant to that certain Unsecured
Revolving Credit Agreement,  dated as of January 6, 1998 (as amended,  modified,
renewed or extended from time to time, the "Agreement")  among Great Lakes REIT,
L.P.  ("Borrower"),  Bank of America  National  Trust and  Savings  Association,
individually  and as  Administrative  Agent,  the  Documentation  Agent  and the
Lenders named therein.  Unless otherwise defined herein,  capitalized terms used
in this Compliance  Certificate have the respective meanings ascribed thereto in
the Agreement.

         THE UNDERSIGNED HEREBY CERTIFIES THAT:

         1.       I am the duly elected [Chief Financial Officer]
[Chief Accounting Officer] [Controller] of General Partner.

         2. I have  reviewed the terms of the Agreement and I have made, or have
caused to be made under my supervision,  a detailed  review of the  transactions
and  conditions  of  the  Consolidated   Operating  Partnership  and  Investment
Affiliates  during the  accounting  period  covered by the financial  statements
attached (or most  recently  delivered to the  Administrative  Agent if none are
attached).

         3. The  examinations  described in Paragraph 2 did not disclose,  and I
have no knowledge of, the existence of any condition or event which  constitutes
a Material Adverse  Financial  Change,  Event of Default or Default during or at
the end of the accounting period covered by the attached financial statements or
as of the date of this Compliance Certificate, except as set forth below.

         4. Schedule I (if attached)  attached  hereto sets forth financial data
and  computations and other  information  evidencing  Borrower's  compliance the
covenants contained in Article VII of the Agreement with certain other covenants
of the Agreement,  all of which data,  computations  and  information  (or if no
Schedule I is attached, the data,  computations and information contained in the
most recent  Schedule I attached to a prior  Compliance  Certificate)  are true,
complete and correct in all material respects.

         5. The  financial  statements,  updates,  reports  and other  materials
referred to in Section 8.2(i),  8.2(ii),  8.2(iv), or 8.2(viii), as the case may
be, of the Agreement which are delivered  concurrently with the delivery of this
Compliance  Certificate,  if any, and those most recently  delivered pursuant to
Section 8.2(v) and Section 8.14 of the Agreement,  if any, fairly and accurately
present in all  material  respects,  in the case of  financial  statements,  the
consolidated  financial  condition and operations of the Consolidated  Operating
Partnership at such date and the  consolidated  results of their  operations for
the period then-ended,  in accordance with GAAP applied consistently  throughout
such period and with prior  periods  and, in the case of  deliveries  other than
financial statements,  the matters set forth therein as of the dates and for the
periods  covered  thereby;  provided,  however,  that any  projections  included
therein constitute good faith estimates of reasonably anticipated future matters
which cannot be predicted with certainty.

         Described below are the exceptions, if any, to Paragraph 3 by listing,
in detail, the nature of


<PAGE>




the  condition or event,  the period  during which it has existed and the action
which the  Borrower  has taken,  is taking,  or proposes to take with respect to
each such condition or event:





























         The  foregoing  certifications,  together  with  the  computations  and
information  set  forth in  Schedule  I  hereto  and the  financial  statements,
updates,  reports  and  other  materials  delivered  with  or  covered  by  this
Compliance Certificate are made and delivered this day of , 19
 .



                            , a Qualified Officer of General Partner




<PAGE>




                                    EXHIBIT G

                 SCOPE OF WORK FOR ENVIRONMENTAL INVESTIGATIONS



                         ENVIRONMENTAL SITE ASSESSMENTS

                  Bank of America ("BofA") Reporting Standards

The  following  are BofA  Guidelines  for the  qualification  of  firms  and for
information to be included in Environmental  Site  Assessments.  These standards
include the minimum elements common to acceptable site  assessments.  Generally,
it is intended for the  standards to be  consistent  with those  outlined in the
American Society for Testing and Materials (ASTM) Designation:  E 1527-93.  This
listing is not intended to be a "how to" manual, as we rely on the environmental
professionals to expand the scope of their services and the information included
in the reports as required.

Qualifications of Investigating Firm

         The  firm  must  have 5 years of  experience  in  hazardous  substances
         investigation.  Many of these firms began as geotechnical  consultants,
         but  expertise  only in  soils  analysis  does  not  qualify  them  for
         hazardous  substance  analysis.  The person supervising and signing the
         report should be experienced in all matters  covered in the report.  He
         should be a registered  professional  engineer or have advanced degrees
         in related  disciplines.  The firm  performing  the work should be of a
         professional nature with knowledge of local conditions.

Depth of Reporting Required

         Phase I -  Consists  of site  description,  review  of  historical  and
         regulatory   data  and  a   physical   inspection.   If  no   potential
         contamination is indicated,  the report should so state, and a specific
         statement should be made that no further investigation is required (see
         content requirements below).

         Phase  II - If a Phase  I  examination  indicates  the  possibility  of
         contamination, the consultant should describe his suspicions, the areas
         to be tested, sampling procedures to be used and methods used to assess
         the sample.  He should then specify and carry out a testing program for
         further evaluation.

         Phase III - If Phase II reveals  material  contamination at the site in
         amounts or concentrations  that are deemed  unacceptable by BofA in its
         sole discretion, the consultant will design and implement a remediation
         program to remove the identified hazardous materials in accordance with
         all environmental laws. The report should include an estimated cost for
         the clean-up.

BofA will  initially  require a Phase I site  assessment  report  including  the
following:


<PAGE>




Site Description

         The site description  section should include a detailed  description of
         the site,  existing  buildings  and  current  site use.  It should also
         include a general  description  of the uses and  conditions of adjacent
         properties  which might  result in migrating  contamination.  It should
         include a summary of the visual observations including, but not limited
         to, vegetation stress,  debris,  fill materials,  ponding,  evidence of
         underground  storage  tanks,  evidence of previous  dumping or storage,
         discolored  or  stained  soils,  wetlands,  groundwater  flows,  and  a
         description  of regional  geology and hydrology.  On vacant sites,  the
         investigator should compare his observations to a USGS topographic map,
         noting any changes in elevations or depressions which have been covered
         over, possibly indicating past dumping or burial of wastes.

         On sites with existing improvements,  the investigator should interview
         personnel  at the  site  regarding  hazardous  materials  currently  or
         previously used at the site,  underground storage tanks, pipeline right
         of ways and any other areas of concern. Buildings should be checked for
         asbestos containing materials, PCB equipment, etc.

Historical Uses of Site, Adjacent Properties, and Significant Nearby Properties

         The historical analysis should provide a chronology of past and present
         significant  uses of the subject site and adjacent sites, and highlight
         activities  which  might  have  contributed   unacceptable   levels  of
         contaminants.  It should  contain  an  explanation  of the  methods  of
         historical  search which were pursued,  the information  expected to be
         obtained and the  information  actually  obtained from each search.  In
         general,  the  historical  review  should  cover 30-40 years of history
         depending  on  the  availability  of  information.  Its  purpose  is to
         investigate the possibility of prior hazardous  substances  releases at
         the property,  identify  potential  contingent  liability from historic
         off-site  disposal of  hazardous  substances,  or  identify  sources of
         contamination which have or might in the future migrate to the site.

         The historical analysis should include but not be limited to:

         Review   of  aerial   photographs   to  identify  past  land  uses  and
                  development  trends, and identify possible locations of ponds,
                  landfills, tanks, areas of soil discoloration or drum storage.

         Review   of county tax records or title search to identify past uses of
                  potential concern such as gas stations or industrial uses.

         Conversations  with   local   environmental   and   health   officials,
                  investigation of local, state and federal regulatory  agencies
                  files including the EPA and Corps of Engineers, and a check of
                  EPA lists of known  contaminated  sites, to check for recorded
                  hazardous   substances   handling,   or  potential  permitting
                  requirements  of  air  emissions,   wastewater,  RCRA  or  TSD
                  permits.

         Other  information  which may be  attached to the report  include,  but
should not be limited to:

         A discussion of existing and proposed environmental standards and
legislation of the area

         Site Plan


<PAGE>




      Ground level photos of the site with specific attention to any
characteristics noted in the report

     Area diagram  showing the  location of any matters  mentioned in the report
and showing the site and adjacent  properties if any potential hazardous sources
are identified on adjacent or nearby properties

     Copies of representative aerial photos

     Copies of correspondence with regulatory agencies

     Documents acquired during title search

     Chain of custody records

     Location map of site and immediate surroundings

     Listing of adjacent property owners and use of the properties

     Any other material available which describes or verifies information
given or conclusions drawn in the report

Conclusions and Recommendations

         The  Consultant  will  prepare a complete  written  report  which fully
         defines the scope of his  responsibilities  and  objectives.  It should
         describe the sources used,  the  activities  performed,  the dates when
         activities were performed, the results of research and recommendations.
         Specific  recommendations  for  remedial  action,  additional  tests or
         investigations  for each  recognized  area of concern or condition  and
         approximate  costs of further  investigation  or  remediation  shall be
         provided within the report.

         The  conclusion  section must clearly state that the firm has exercised
         professional judgment in reaching one of the following:

                  The  Consultant,  after  performing the  appropriate  level of
                  investigation,   has   revealed  no  evidence  of   recognized
                  environmental   conditions  in  connection  with  the  subject
                  property and no further testing or investigation is warranted.

         or

                  The  Consultant,  after  performing the  appropriate  level of
                  investigation,   has   revealed  no  evidence  of   recognized
                  environmental   conditions  in  connection  with  the  subject
                  property except for the following:

         If the Consultant was restricted by factors such as time limitations or
         scope-of-service  limitations  agreed to with the borrower,  the report
         should so state.

         The report is to be signed by a  professional  engineer,  environmental
         manager or supervisor or any other individuals who provide  significant
         professional    assistance   in   completing   the   assignment.    The
         qualifications  of  the  individuals   signing  the  report  should  be
         included.




<PAGE>




                                    EXHIBIT H

                          FORM OF ASSIGNMENT AGREEMENT



         This Assignment Agreement (this "Assignment Agreement") between
          (the "Assignor") and                , (the "Assignee") is dated as of
                  , 19_.  The parties hereto agree as follows:

         PRELIMINARY  STATEMENT.  The  Assignor  is  a  party  to  an  Unsecured
Revolving Credit Agreement  (which, as it may be amended,  modified,  renewed or
extended from time to time is herein called the "Credit Agreement") described in
Item 1 of Schedule 1 attached  hereto  ("Schedule  1").  Capitalized  terms used
herein and not otherwise  defined  herein shall have the meanings  attributed to
them in the Credit Agreement.

         ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to the
Assignee,  and the Assignee hereby  purchases and assumes from the Assignor,  an
interest  in and to the  Assignor's  rights  and  obligations  under the  Credit
Agreement  such that after giving effect to such  assignment  the Assignee shall
have purchased  pursuant to this  Assignment  Agreement the percentage  interest
specified  in Item 3 of  Schedule 1 of all  outstanding  rights and  obligations
under  the  Credit  Agreement  and  the  other  Loan  Documents.  The  aggregate
Commitment  (or  Loans,  if  the  applicable  Commitment  has  been  terminated)
purchased by the Assignee hereunder is set forth in Item 4 of Schedule 1.

         EFFECTIVE  DATE. The effective date of this  Assignment  Agreement (the
"Effective Date") shall be the later of the date specified in Item 5 of Schedule
1  or  two  (2)  Business  Days  (or  such  shorter  period  agreed  to  by  the
Administrative Agent) after a Notice of Assignment  substantially in the form of
Schedule 2 attached hereto has been delivered to the Administrative Agent. In no
event will the Effective  Date occur if the payments  required to be made by the
Assignee to the Assignor on the Effective Date under Sections 4 and 5 hereof are
not made on the proposed  Effective Date,  unless otherwise agreed to in writing
by Assignor and Assignee.  The Assignor will notify the Assignee of the proposed
Effective  Date no later than the Business  Day prior to the proposed  Effective
Date.  As of the  Effective  Date,  (i) the  Assignee  shall have the rights and
obligations  of a Lender under the Loan Documents with respect to the rights and
obligations  assigned to the  Assignee  hereunder  and (ii) the  Assignor  shall
relinquish its rights and be released from its  corresponding  obligations under
the Loan  Documents with respect to the rights and  obligations  assigned to the
Assignee hereunder.

         PAYMENTS  OBLIGATIONS.  On and after the Effective  Date,  the Assignee
shall be  entitled  to receive  from the  Administrative  Agent all  payments of
principal,  interest and fees with respect to the interest assigned hereby.  The
Assignee shall advance funds directly to the  Administrative  Agent with respect
to all Loans and reimbursement payments made on or after the Effective Date with
respect to the interest  assigned  hereby.  [In  consideration  for the sale and
assignment of Loans hereunder,  (i) the Assignee shall pay the Assignor,  on the
Effective  Date, an amount equal to the  principal  amount of the portion of all
Base Rate Loans assigned to the Assignee hereunder and (ii) with respect to each
LIBOR Loan made by the Assignor and assigned to the Assignee  hereunder which is
outstanding on the Effective  Date,  (a) on the last day of the Interest  Period
therefor or (b) on such  earlier date agreed to by the Assignor and the Assignee
or (c) on the date on which any such Loan either becomes due (by acceleration or
otherwise) or is prepaid (the


<PAGE>




date as described  in the  foregoing  clauses (a), (b) or (c) being  hereinafter
referred to as the "Fixed Due Date"),  the  Assignee  shall pay the  Assignor an
amount equal to the principal amount of the portion of such Loan assigned to the
Assignee  which is  outstanding  on the Fixed Due Date.  If the Assignor and the
Assignee  agree  that the  applicable  Fixed Due Date for such Loan shall be the
Effective Date, they shall agree,  solely for purposes of dividing interest paid
by the Borrower on such Loan, to an alternate  interest  rate  applicable to the
portion of such Loan assigned  hereunder for the period from the Effective  Date
to the end of the related  Interest Period (the "Agreed  Interest Rate") and any
interest  received by the Assignee in excess of the Agreed  Interest Rate,  with
respect to such Loan for such period, shall be remitted to the Assignor.  In the
event a  prepayment  of any Loan which is  existing  on the  Effective  Date and
assigned by the Assignor to the Assignee  hereunder  occurs after the  Effective
Date but before the  applicable  Fixed Due Date, the Assignee shall remit to the
Assignor any excess of the funding  indemnification  amount paid by the Borrower
under  Section 4.4 of the Credit  Agreement an account of such  prepayment  with
respect to the portion of such Loan assigned to the Assignee  hereunder over the
amount  which would have been paid if such  prepayment  amount  were  calculated
based on the Agreed  Interest  Rate and only covered the portion of the Interest
Period  after the  Effective  Date.  The  Assignee  will  promptly  remit to the
Assignor  (i) the  portion of any  principal  payments  assigned  hereunder  and
received  from the  Administrative  Agent with respect to any such Loan prior to
its Fixed Due Date and (ii) any amounts of  interest on Loans and fees  received
from the Administrative  Agent which relate to the portion of the Loans assigned
to the Assignee  hereunder for periods prior to the Effective  Date, in the case
of Base Rate Loans or fees,  or the Fixed Due Date,  in the case of LIBOR Loans,
and not  previously  paid by the Assignee to the  Assignor.]*  In the event that
either  party  hereto  receives  any payment to which the other party  hereto is
entitled under this Assignment  Agreement,  then the party receiving such amount
shall promptly remit it to the other party hereto.

         FEES PAYABLE BY THE ASSIGNEE.  The Assignee shall pay to the Assignor a
fee on each day on which a payment of  interest or fees is made under the Credit
Agreement with respect to the amounts assigned to the Assignee  hereunder (other
than a payment of  interest  or fees  attributable  to the  period  prior to the
Effective  Date in the case of Base Rate  Loans or, in the case of LIBOR  Loans,
prior to the Fixed Due Date,  which the  Assignee is obligated to deliver to the
Assignor  pursuant  to  Section 4  hereof).  The amount of such fee shall be the
difference between (i) the interest or fee, as applicable,  paid with respect to
the amounts assigned to the Assignee  hereunder and (ii) the interest or fee, as
applicable,  which would have been paid with respect to the amounts  assigned to
the Assignee  hereunder if each interest  rate was  calculated at the rate of _%
rather than the actual  percentage  used to calculate  the interest rate paid by
the  Borrower  or if the fee was  calculated  at the rate of __% rather than the
actual percentage used to calculate the fee paid by the Borrower, as applicable.
In addition,  the Assignee agrees to pay % of the fee required to be paid to the
Administrative  Agent  in  connection  with  this  Assignment  Agreement.  [This
sentence can be revised appropriately based on how the fee is being paid.]

         1.*Each  Assignor  may insert its  standard  provisions  in lieu of the
payment terms included in Sections 4 and 5 of this Exhibit.

         REPRESENTATIONS   OF  THE  ASSIGNOR:   LIMITATIONS  ON  THE  ASSIGNOR'S
LIABILITY.  The  Assignor  represents  and  warrants  that it is the  legal  and
beneficial  owner of the interest  being  assigned by it hereunder and that such
interest is free and clear of any adverse claim  created by the Assignor.  It is
understood  and agreed that the  assignment  and  assumption  hereunder are made
without  recourse  to  the  Assignor  and  that  the  Assignor  makes  no  other
representation or warranty of any kind to the Assignee. Neither the Assignor nor
any  of its  officers,  directors,  employees,  agents  or  attorneys  shall  be
responsible for (i) the due execution, legality, validity,


<PAGE>




enforceability, genuineness, sufficiency or collectability of any Loan Document,
including  without  limitation,  documents  granting  the Assignor and the other
Lenders a security interest in assets of the Borrower or any guarantor, (ii) any
representation,  warranty or statement made in or in connection  with any of the
Loan  Documents,  (iii)  the  financial  condition  or  creditworthiness  of the
Borrower or any guarantor, (iv) the performance of or compliance with any of the
terms or  provisions of any of the Loan  Documents,  (v)  inspecting  any of the
Property,  books or records of the  Borrower,  its  Subsidiaries  or  Investment
Affiliates, (vi) the validity, enforceability,  perfection, priority, condition,
value or  sufficiency  of any  collateral  securing or  purporting to secure the
Loans or (vii) any mistake,  error of judgment, or action taken or omitted to be
taken in connection with the Loans or the Loan Documents.

         REPRESENTATIONS OF THE ASSIGNEE.  The Assignee (i) confirms that it has
received a copy of the Credit  Agreement and the other Loan Documents,  together
with copies of the financial statements requested by the Assignee and such other
documents and  information  as it has deemed  appropriate to make its own credit
analysis and decision to enter into this Assignment Agreement,  (ii) agrees that
it will,  independently and without reliance upon the Administrative  Agent, the
Assignor or any other Lender and based on such  documents and  information at it
shall deem appropriate at the time, continue to make its own credit decisions in
taking  or not  taking  action  under the Loan  Documents,  (iii)  appoints  and
authorizes the  Administrative  Agent to take such action as agent on its behalf
and to exercise  such powers under the Loan  Documents  as are  delegated to the
Administrative  Agent by the terms  thereof,  together  with such  powers as are
reasonably  incidental  thereto,  (iv) agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Loan Documents
are  required  to be  performed  by it as a Lender,  (v) agrees that its payment
instructions  and  notice  instructions  are as set forth in the  attachment  to
Schedule  1, (vi)  confirms  that  none of the  funds,  monies,  assets or other
consideration being used to make the purchase and assumption hereunder are "plan
assets" as defined  under ERISA and that its rights,  benefits and  interests in
and under the Loan Documents  will not be "plan assets" under ERISA,  [and (vii)
attaches  the forms  prescribed  by the Internal  Revenue  Service of the United
States  certifying  that the Assignee is entitled to receive  payments under the
Loan  Documents  without  deduction or  withholding of any United States federal
income taxes].**

** to be inserted  if the  Assignee  is not  incorporated  under the laws of the
United States, or a state thereof.

         INDEMNITY.  The  Assignee  agrees to  indemnify  and hold the  Assignor
harmless  against any and all losses,  costs and  expenses  (including,  without
limitation, reasonable attorneys' fees) and liabilities incurred by the Assignor
in connection with or arising in any manner from the Assignee's  non-performance
of the obligations assumed under this Assignment Agreement.

         SUBSEQUENT  ASSIGNMENTS.  After the Effective  Date, the Assignee shall
have the right pursuant to Section 13.3.1 of the Credit  Agreement to assign the
rights  which are  assigned to the  Assignee  hereunder to any entity or person,
provided  that (i) any such  subsequent  assignment  does not violate any of the
terms and conditions of the Loan Documents or any law, rule, regulation,  order,
writ,  judgment,  injunction or decree and that any consent  required  under the
terms of the Loan  Documents has been obtained and (ii) unless the prior written
consent of the Assignor is obtained,  the Assignee is not thereby  released from
its obligations to the Assignor hereunder, if any remain unsatisfied, including,
without limitation, its obligations under Sections 4, 5 and 8 hereof.

     REDUCTIONS  OF AGGREGATE  COMMITMENT.  If any  reduction  in the  Aggregate
Commitment  occurs  between  the  date  of  this  Assignment  Agreement  and the
Effective Date, the


<PAGE>




percentage interest specified in Item 3 of Schedule 1 shall remain the same, but
the dollar amount purchased shall be recalculated based on the reduced Aggregate
Commitment.

         ENTIRE AGREEMENT.  This Assignment Agreement and the attached Notice of
Assignment  embody the entire  agreement and  understanding  between the parties
hereto and supersede all prior agreements and understandings between the parties
hereto relating to the subject matter hereof.

         GOVERNING LAW. This Assignment Agreement shall be governed by the
internal law, and not the law of conflicts, of the State of Illinois.

         NOTICES.  Notices shall be given under this Assignment Agreement in the
manner set forth in the Credit Agreement.  For the purpose hereof, the addresses
of the  parties  hereto  until  notice  of a change is  delivered)  shall be the
address set forth in the attachment to Schedule 1.

                  IN WITNESS  WHEREOF,  the parties  hereto have  executed  this
Assignment  Agreement  by their duly  authorized  officers  as of the date first
above written.

                                                     [NAME OF ASSIGNOR]



                                                     By:
                                                     Title:




                                                     [NAME OF ASSIGNEE]


                                                     By:
                                                     Title:






<PAGE>






                                  SCHEDULE 1 TO
                              ASSIGNMENT AGREEMENT



Description and Date of Credit Agreement:

Date of Assignment Agreement:  __________, 19__

Amounts (as of date of Item 2 above):

              a.  Aggregate Commitment
                    (Loans)* under
                   Loan Agreement                                      $

              b.  Assignee's Percentage
                   of the Aggregate Commitment
                   purchased under this
                   Assignment Agreement**                              %

Amount of Assignee's Commitment (Loan Amount)*
     purchased under this Assignment Agreement:                        $

Amount of Assignor's Commitment (Loan Amount)
     after purchase under this Assignment Agreement

Proposed Effective Date:

Accepted and Agreed:

[NAME OF ASSIGNOR]                                 [NAME OF ASSIGNEE]

By:                                                By:
Title:                                             Title:


*If a  Commitment  has been  terminated,  insert  outstanding  Loans in place of
Commitment.

**Percentage taken to 10 decimal places.


<PAGE>





                           ATTACHMENT TO SCHEDULE 1 TO
                              ASSIGNMENT AGREEMENT


              Attach Assignor's  Administrative  Information  Sheet,  which must
              include  notice address and account  information  for the Assignor
              and the Assignee.






<PAGE>






                                  SCHEDULE 2 TO
                              ASSIGNMENT AGREEMENT

                              NOTICE OF ASSIGNMENT


                                                   ______________, 19___



         To:      [NAME OF ADMINISTRATIVE AGENT]



         From:  [NAME OF ASSIGNOR] (the "Assignor")

                  [NAME OF ASSIGNEE] (the "Assignee")

         We refer to that  Unsecured  Revolving  Credit  Agreement  (the "Credit
Agreement")  described in Item 1 of Schedule 1 attached  hereto  ("Schedule 1").
Capitalized  terms used herein and not otherwise  defined  herein shall have the
meanings attributed to them in the Loan Agreement.

     This Notice of  Assignment  (this  "Notice") is given and  delivered to the
Administrative Agent pursuant to Section 13.3.1 of the Credit Agreement.

     The Assignor and the Assignee  have entered into an  Assignment  Agreement,
dated as of ______,  19___ (the  "Assignment"),  pursuant to which,  among other
things,  the Assignor  has sold,  assigned,  delegated  and  transferred  to the
Assignee, and the Assignee has purchased, accepted and assumed from the Assignor
the  percentage  interest  specified in Item 3 of Schedule 1 of all  outstanding
rights and obligations under the Credit Agreement. From and after such purchase,
the Assignor's Commitment shall be the amount specified in Item 5 of Schedule 1.
The Effective Date of the Assignment shall be the later of the date specified in
Item 5 of Schedule 1 or two (2) Business Days (or such shorter  period as agreed
to by the  Administrative  Agent)  after this Notice of  Assignment  and any fee
required by Section  13.3.1 of the Credit  Agreement  have been delivered to the
Administrative  Agent,  provided that the Effective  Date shall not occur if any
condition  precedent  agreed to by the Assignor and the Assignee or set forth in
Section 13 of the Credit Agreement has not been satisfied.

     The  Assignor  and the  Assignee  hereby give to the  Administrative  Agent
notice of the assignment and  delegation  referred to herein.  The Assignor will
confer with the  Administrative  Agent  before the date  specified  in Item 6 of
Schedule 1 to determine if the  Assignment  Agreement  will become  effective on
such date pursuant to Section 3 hereof,  and will confer with the Administrative
Agent to determine the Effective  Date pursuant to Section 3 hereof if it occurs
thereafter. The Assignor shall notify the Administrative Agent if the Assignment
Agreement does not become  effective on any proposed  Effective Date as a result
of the failure to satisfy the conditions precedent agreed to by the Assignor and
the Assignee. At the request of the Administrative Agent, the Assignor will give
the  Administrative  Agent  written  confirmation  of  the  satisfaction  of the
conditions precedent.


<PAGE>




     The Assignor or the Assignee  shall pay to the  Administrative  Agent on or
before the  Effective  Date the  processing  fee of $3,500  required  by Section
13.3.1 of the Loan Agreement.

     If Notes are  outstanding  on the  Effective  Date,  the  Assignor  and the
Assignee request and direct that the Administrative  Agent prepare and cause the
Borrower to execute and deliver new Notes or, as appropriate, replacements notes
to the Assignor and the Assignee. The Assignor and, if applicable,  the Assignee
each agree to deliver to the Administrative  Agent the original Note received by
it from the Borrower upon its receipt of a new Note in the appropriate amount.

     The  Assignee  advised  the  Administrative  Agent that  notice and payment
instructions are set forth in the attachment to Schedule 1.

     The Assignee hereby represents and warrants that none of the funds, monies,
assets or other  consideration  being used to make the purchase  pursuant to the
Assignment  are "plan  assets"  as  defined  under  ERISA  and that its  rights,
benefits and interests in and under the Loan Documents will not be "plan assets"
under ERISA.

     The Assignee authorized the Administrative  Agent to act as its agent under
the  Loan  Document  in  accordance   with  the  terms  thereof.   The  Assignee
acknowledges  that the  Administrative  Agent has no duty to supply  information
with  respect to the Borrower or the Loan  Documents  to the Assignee  until the
Assignee becomes a party to the Credit Agreement.*

*May be eliminated if Assignee is a party to the Loan Agreement prior to the
Effective Date.

NAME OF ASSIGNOR                                              NAME OF ASSIGNEE

By:  ______________________                                   By:

Title:                              __                        Title:



ACKNOWLEDGED AND CONSENTED TO

BY BANK OF AMERICA NATIONAL TRUST AND

SAVINGS ASSOCIATION OF CHICAGO,

as Administrative Agent






<PAGE>




                                  SCHEDULE 6.1

                                 CREDIT PARTIES


<PAGE>




                                  SCHEDULE 6.9

                                   LITIGATION



                                      None.


<PAGE>




                                  SCHEDULE 6.19

                              ENVIRONMENTAL MATTERS


<PAGE>




                                  SCHEDULE 6.24

                                   TRADE NAMES



                                      None.


<PAGE>




                                  SCHEDULE 6.25

                     SUBSIDIARIES (EXCLUDING CREDIT PARTIES)



                There are no  Subsidiaries  that are not Credit  Parties  and no
Investment Affiliates.


<PAGE>




                                  SCHEDULE 6.26

                                    PROPERTY




<PAGE>




                                  SCHEDULE 9.6

                 LIENS (OTHER THAN THOSE COVERED BY 9.6(i)-(vi))



<PAGE>