**Exhibit 10.466**

 

**LOAN****AGREEMENT**

 

 

Dated as of December 16, 2004

 

 

Between

 

 

INLAND WESTERN GREENSBORO AIRPORT CENTER, L.L.C,

 

 

as Borrower

 

 

and

 

 

**BANK OF AMERICA, N.A.,**

as Lender

 

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TABLE OF CONTENTS

 
| **ARTICLE 1 DEFINITIONS; PRINCIPLES OF  CONSTRUCTION**         |   |
|---------------------------------------------------------------------|--------|
|                                                                |   |
| SECTION 1.1. DEFINITIONS                                       |   |
| SECTION 1.2. PRINCIPLES OF  CONSTRUCTION                       |   |
|                                                                |   |
| **ARTICLE 2 GENERAL TERMS**                                    |   |
|                                                                |   |
| SECTION 2.1. LOAN COMMITMENT;  DISBURSEMENT TO BORROWER        |   |
| SECTION 2.2. LOAN PAYMENTS                                     |   |
| SECTION 2.3. PREPAYMENT                                        |   |
|                                                                |   |
| **ARTICLE 3 CONDITIONS PRECEDENT**                             |   |
|                                                                |   |
| **ARTICLE 4 REPRESENTATIONS AND  WARRANTIES**                  |   |
|                                                                |   |
| SECTION 4.1. ORGANIZATION                                      |   |
| SECTION 4.2. STATUS OF BORROWER                                |   |
| SECTION 4.3. VALIDITY OF DOCUMENTS                             |   |
| SECTION 4.4. NO CONFLICTS                                      |   |
| SECTION 4.5. LITIGATION                                        |   |
| SECTION 4.6. AGREEMENTS                                        |   |
| SECTION 4.7. SOLVENCY                                          |   |
| SECTION 4.8. FULL AND ACCURATE  DISCLOSURE                     |   |
| SECTION 4.9. NO PLAN ASSETS                                    |   |
| SECTION 4.10. NOT A FOREIGN PERSON                             |   |
| SECTION 4.11. ENFORCEABILITY                                   |   |
| SECTION 4.12. BUSINESS PURPOSES                                |   |
| SECTION 4.13. COMPLIANCE                                       |   |
| SECTION 4.14. FINANCIAL INFORMATION                            |   |
| SECTION 4.15. CONDEMNATION                                     |   |
| SECTION 4.16. UTILITIES AND PUBLIC  ACCESS; PARKING            |   |
| SECTION 4.17. SEPARATE LOTS                                    |   |
| SECTION 4.18. ASSESSMENTS                                      |   |
| SECTION 4.19. INSURANCE                                        |   |
| SECTION 4.20. USE OF PROPERTY                                  |   |
| SECTION 4.21. CERTIFICATE OF  OCCUPANCY; LICENSES              |   |
| SECTION 4.22. FLOOD ZONE                                       |   |
| SECTION 4.23. PHYSICAL CONDITION                               |   |
| SECTION 4.24. BOUNDARIES; SURVEY                               |   |
| SECTION 4.25. LEASES                                           |   |
| SECTION 4.26. FILING AND RECORDING  TAXES                      |   |
| SECTION 4.27. MANAGEMENT AGREEMENT                             |   |
| SECTION 4.28. ILLEGAL ACTIVITY                                 |   |
| SECTION 4.29. CONSTRUCTION EXPENSES                            |   |
| SECTION 4.30. PERSONAL PROPERTY                                |   |
| SECTION 4.31. TAXES                                            |   |
| SECTION 4.32. PERMITTED ENCUMBRANCES                           |   |
| SECTION 4.33. FEDERAL RESERVE  REGULATIONS                     |   |
| SECTION 4.34. INVESTMENT COMPANY ACT                           |   |
| SECTION 4.35. RECIPROCAL EASEMENT  AGREEMENTS                  |   |
| SECTION 4.36. NO CHANGE IN FACTS OR  CIRCUMSTANCES; DISCLOSURE |   |

 

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| SECTION 4.37. INTELLECTUAL PROPERTY                           |   |
|--------------------------------------------------------------------|--------|
| SECTION 4.38. COMPLIANCE WITH  ANTI-TERRORISM LAWS            |   |
| SECTION 4.39. PATRIOT ACT                                     |   |
| SECTION 4.40. SURVIVAL                                        |   |
|                                                               |   |
| **ARTICLE 5 BORROWER COVENANTS**                              |   |
|                                                               |   |
| SECTION 5.1. EXISTENCE; COMPLIANCE  WITH LEGAL REQUIREMENTS   |   |
| SECTION 5.2. MAINTENANCE AND USE OF  PROPERTY                 |   |
| SECTION 5.3. WASTE                                            |   |
| SECTION 5.4. TAXES AND OTHER CHARGES                          |   |
| SECTION 5.5. LITIGATION                                       |   |
| SECTION 5.6. ACCESS TO PROPERTY                               |   |
| SECTION 5.7. NOTICE OF DEFAULT                                |   |
| SECTION 5.8. COOPERATE IN LEGAL  PROCEEDINGS                  |   |
| SECTION 5.9. PERFORMANCE BY BORROWER                          |   |
| SECTION 5.10. AWARDS; INSURANCE  PROCEEDS                     |   |
| SECTION 5.11. FINANCIAL REPORTING                             |   |
| SECTION 5.12. ESTOPPEL STATEMENT                              |   |
| SECTION 5.13. LEASING MATTERS                                 |   |
| SECTION 5.14. PROPERTY MANAGEMENT                             |   |
| SECTION 5.15. LIENS                                           |   |
| SECTION 5.16. DEBT CANCELLATION                               |   |
| SECTION 5.17. ZONING                                          |   |
| SECTION 5.18. ERISA                                           |   |
| SECTION 5.19. NO JOINT ASSESSMENT                             |   |
| SECTION 5.20. RECIPROCAL EASEMENT  AGREEMENTS                 |   |
|                                                               |   |
| **ARTICLE 6 ENTITY COVENANTS**                                |   |
|                                                               |   |
| SECTION 6.1. SINGLE PURPOSE  ENTITY/SEPARATENESS              |   |
| SECTION 6.2. CHANGE OF NAME, IDENTITY  OR STRUCTURE           |   |
| SECTION 6.3. BUSINESS AND OPERATIONS                          |   |
| SECTION 6.4. INDEPENDENT DIRECTOR                             |   |
|                                                               |   |
| **ARTICLE 7 NO SALE OR ENCUMBRANCE**                          |   |
|                                                               |   |
| SECTION 7.1. TRANSFER DEFINITIONS                             |   |
| SECTION 7.2. NO SALE/ENCUMBRANCE                              |   |
| SECTION 7.3. PERMITTED TRANSFERS                              |   |
| SECTION 7.4. LENDER’S RIGHTS                             |   |
| SECTION 7.5. ASSUMPTION                                       |   |
| SECTION 7.6. ASSUMPTION BY INLAND  PERMITTED TRANSFEREE       |   |
|                                                               |   |
| **ARTICLE 8 INSURANCE; CASUALTY;  CONDEMNATION; RESTORATION** |   |
|                                                               |   |
| SECTION 8.1. INSURANCE                                        |   |
| SECTION 8.2. CASUALTY                                         |   |
| SECTION 8.3. CONDEMNATION                                     |   |
| SECTION 8.4. RESTORATION                                      |   |
|                                                               |   |
| **ARTICLE 9 REPLACEMENTS; RESERVE FUNDS**                     |   |
|                                                               |   |
| SECTION 9.1. REPLACEMENTS                                     |   |
| SECTION 9.2. TAX AND INSURANCE RESERVE  FUNDS                 |   |
| SECTION 9.3. RESERVE FUNDS GENERALLY                          |   |
|                                                               |   |
| **ARTICLE 10 CASH MANAGEMENT**                                |   |
|                                                               |   |
| SECTION 10.1. CASH MANAGEMENT ACCOUNT                         |   |
| SECTION 10.2. DEPOSITS AND WITHDRAWALS                        |   |
| SECTION 10.3. SECURITY INTEREST                               |   |

 

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| **ARTICLE 11 EVENTS OF DEFAULT; REMEDIES**                             |   |
|-----------------------------------------------------------------------------|--------|
|                                                                        |   |
| SECTION 11.1. EVENT OF DEFAULT                                         |   |
| SECTION 11.2. REMEDIES                                                 |   |
|                                                                        |   |
| **ARTICLE 12 ENVIRONMENTAL PROVISIONS**                                |   |
|                                                                        |   |
| SECTION 12.1. ENVIRONMENTAL  REPRESENTATIONS AND WARRANTIES            |   |
| SECTION 12.2. ENVIRONMENTAL COVENANTS                                  |   |
| SECTION 12.3. LENDER’S RIGHTS                                     |   |
| SECTION 12.4. OPERATIONS AND  MAINTENANCE PROGRAMS                     |   |
| SECTION 12.5. ENVIRONMENTAL  DEFINITIONS                               |   |
|                                                                        |   |
| **ARTICLE 13 SECONDARY MARKET**                                        |   |
|                                                                        |   |
| SECTION 13.1. TRANSFER OF LOAN                                         |   |
| SECTION 13.2. DELEGATION OF SERVICING                                  |   |
| SECTION 13.3. DISSEMINATION OF  INFORMATION                            |   |
| SECTION 13.4. COOPERATION                                              |   |
|                                                                        |   |
| **ARTICLE 14 INDEMNIFICATIONS**                                        |   |
|                                                                        |   |
| SECTION 14.1. GENERAL INDEMNIFICATION                                  |   |
| SECTION 14.2. MORTGAGE AND INTANGIBLE  TAX INDEMNIFICATION             |   |
| SECTION 14.3. ERISA INDEMNIFICATION                                    |   |
| SECTION 14.4. SURVIVAL                                                 |   |
|                                                                        |   |
| **ARTICLE 15 EXCULPATION**                                             |   |
|                                                                        |   |
| SECTION 15.1. EXCULPATION                                              |   |
|                                                                        |   |
| **ARTICLE 16 NOTICES**                                                 |   |
|                                                                        |   |
| SECTION 16.1. NOTICES                                                  |   |
|                                                                        |   |
| **ARTICLE 17 FURTHER ASSURANCES**                                      |   |
|                                                                        |   |
| SECTION 17.1. REPLACEMENT DOCUMENTS                                    |   |
| SECTION 17.2. RECORDING OF MORTGAGE,  ETC                              |   |
| SECTION 17.3. FURTHER ACTS, ETC                                        |   |
| SECTION 17.4. CHANGES IN TAX, DEBT,  CREDIT AND DOCUMENTARY STAMP LAWS |   |
| SECTION 17.5. EXPENSES                                                 |   |
|                                                                        |   |
| **ARTICLE 18 WAIVERS**                                                 |   |
|                                                                        |   |
| SECTION 18.1. REMEDIES CUMULATIVE;  WAIVERS                            |   |
| SECTION 18.2. MODIFICATION, WAIVER IN  WRITING                         |   |
| SECTION 18.3. DELAY NOT A WAIVER                                       |   |
| SECTION 18.4. TRIAL BY JURY                                            |   |
| SECTION 18.5. WAIVER OF NOTICE                                         |   |
| SECTION 18.6. REMEDIES OF BORROWER                                     |   |
| SECTION 18.7. WAIVER OF MARSHALLING OF  ASSETS                         |   |
| SECTION 18.8. WAIVER OF STATUTE OF  LIMITATIONS                        |   |
| SECTION 18.9. WAIVER OF COUNTERCLAIM                                   |   |
|                                                                        |   |
| **ARTICLE 19 GOVERNING LAW**                                           |   |
|                                                                        |   |
| SECTION 19.1. CHOICE OF LAW                                            |   |
| SECTION 19.2. SEVERABILITY                                             |   |
| SECTION 19.3. PREFERENCES                                              |   |
|                                                                        |   |
| **ARTICLE 20 MISCELLANEOUS**                                           |   |
|                                                                        |   |
| SECTION 20.1. SURVIVAL                                                 |   |
| SECTION 20.2. LENDER’S DISCRETION                                 |   |

 

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| SECTION 20.3. HEADINGS                                                       |   |
|-----------------------------------------------------------------------------------|--------|
| SECTION 20.4. COST OF ENFORCEMENT                                            |   |
| SECTION 20.5. SCHEDULES INCORPORATED                                         |   |
| SECTION 20.6. OFFSETS, COUNTERCLAIMS  AND DEFENSES                           |   |
| SECTION 20.7. NO JOINT VENTURE OR  PARTNERSHIP; NO THIRD PARTY BENEFICIARIES |   |
| SECTION 20.8. PUBLICITY                                                      |   |
| SECTION 20.9. CONFLICT; CONSTRUCTION  OR DOCUMENTS; RELIANCE                 |   |
| SECTION 20.10. ENTIRE AGREEMENT                                              |   |

 

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LOAN AGREEMENT

 

THIS LOAN AGREEMENT, dated as of December 16, 2004 (as amended,restated, replaced, supplemented or otherwise modified from time to time, this **“Agreement”**),****between BANK OFAMERICA, N.A., a national banking association, having an address at Bank ofAmerica Corporate Center, 214 North Tryon Street, Charlotte, North Carolina28255 (together with its successors and/or assigns, **“Lender”**) andINLAND WESTERN GREENSBORO AIRPORT CENTER, L.L.C., a Delaware limited liabilitycompany having an address at c/o Inland Real Estate Investment Corporation,2901 Butterfield Road, Oak Brook, Illinois 60523 (together with its successorsand/or assigns, **“Borrower”**).

 

**RECITALS:**

 

Borrower desires to obtain the Loan (defined below) from Lender.

 

Lender is willing to make the Loan, to Borrower, subject to and inaccordance with the terms of this Agreement and the other Loan Documents(defined below).

 

In consideration of the making of the Loan by Lender and the covenants,agreements, representations and warranties set forth in this Agreement, theparties hereto hereby covenant, agree, represent and warrant as follows:

 

**ARTICLE 1DEFINITIONS; PRINCIPLES OF CONSTRUCTION**

 

**Section 1.1.****                               ****Definitions**

 

For all purposes of this Agreement, except as otherwise expresslyrequired or unless the context clearly indicates a contrary intent:

 

**“Account Collateral”**shall mean (i) the Accounts, and all cash,checks, drafts, certificates and instruments, if any, from time to timedeposited or held in the Accounts; (ii) any and all amounts in or credited tothe Accounts invested in Permitted Investments, (iii) all interest, dividends,cash, instruments and other property from time to time received, receivable orotherwise payable in respect of, or in exchange for, any or all of theforegoing; and (iv) to the extent not covered by clauses (i) - (iii) above, all“proceeds” (as defined under the UCC as in effect in the State in which theAccounts are located) of any or all of the foregoing.

 

**“Accounts”**shall mean the Cash Management Account, theTax and Insurance Reserve Accounts, if any, and any other account orsub-account established by this Agreement, the Mortgage, or the other LoanDocuments.

 

**“AccreditedInvestor”**shall have the meaning set forth in theregulations promulgated by the Securities and Exchange Commission.

 

**“Act”**shall have the meaning set forth in Section 6.1 (c).

 

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**“Affiliate”** shall mean, as to any Person, any otherPerson that, directly or indirectly, is in control of, is controlled by or isunder common control with such Person or is a director or officer of suchPerson or of an Affiliate of such Person.

 

**“Affiliated Loans”**shall mean a loan made by Lender to a parent, subsidiary or such other entityaffiliated with Borrower or Borrower Principal.

 

**“Affiliated Manager”**shall have the meaning set forth in Section 7.1hereof. 

 

**“ALTA”**shall mean American Land Title Association, or any successor thereto.

 

**“American Express”**shall mean American Express Travel RelatedServices Company, Inc., a New York corporation.

 

**“American Express Lease”** shall mean that certain Lease Agreementdated as of December 16, 2004 between Borrower, as landlord, and AmericanExpress, as tenant, with respect to the Property.

 

**“American Express Lease Default”******shall mean (i) a default, after theexpiration of any applicable notice or cure periods, under the American ExpressLease or (ii) the cancellation, termination or surrender of the AmericanExpress Lease.

 

**“Assignment of Management Agreement”** shall mean that certain Assignment andSubordination of Management Agreement dated the date hereof among Lender,Borrower and Manager, as the same may be amended, restated, replaced,supplemented or otherwise modified from time to time.

 

**“Award”**shall mean any compensation paid by any Governmental Authority in connectionwith a Condemnation in respect of all or any part of the Property.

 

**“Borrower Principal”** shall mean Inland Western Retail Real EstateTrust, Inc., a Maryland corporation.

 

**“Business Day”** shall mean a day on which Lender is open for the conduct ofsubstantially all of its banking business at its office in the city in whichthe Note is payable (excluding Saturdays and Sundays).

 

**“Cash Management Account”**shall have the meaning set forth in Section 10.1(a)hereof.

 

**“Cash Management Period”**shall mean the period commencing on the 45thday prior to the Optional Prepayment Date.

 

**“Casualty”**shall have the meaning set forth in Section 8.2.

 

“**Closing Date**” shall mean thedate of the funding of the Loan. 

 

**“Control”**shall have the meaning set forth in Section 7.1 hereof.

 

2

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**“Condemnation”**shall mean a temporary or permanent taking byany Governmental Authority as the result, in lieu or in anticipation, of theexercise of the right of condemnation or eminent domain, of all or any part ofthe Property, or any interest therein or right accruing thereto, including anyright of access thereto or any change of grade affecting the Property or any partthereof.

 

**“Condemnation Proceeds”**shall have the meaning set forth in Section 8.4(b)

 

**“Creditors Rights Laws”**shall mean with respect to any Person anyexisting or future law of any jurisdiction, domestic or foreign, relating tobankruptcy, insolvency, reorganization, conservatorship, arrangement,adjustment, winding-up, liquidation, dissolution, composition or other reliefwith respect to its debts or debtors.

 

**“Debt”**shall mean the outstanding principal amountset forth in, and evidenced by, this Agreement and the Note together with allinterest accrued and unpaid thereon and all other sums due to Lender in respectof the Loan under the Note, this Agreement, the Mortgage or any other LoanDocument.

 

**“Debt Service”**shall mean, with respect to any particularperiod of time, scheduled principal and/or interest payments under the Note.

 

**“Default”**shall mean the occurrence of any eventhereunder or under any other Loan Document which, but for the giving of noticeor passage of time, or both, would be an Event of Default.

 

**“Default Rate”**shall mean, with respect to the Loan, a rateper annum equal to the lesser of (a) the maximum rate permitted by applicablelaw, or (b) four percent (4%) above the Note Rate.

 

**“Eligible Account”**shall mean a separate and identifiableaccount from all other funds held by the holding institution that is either (a)an account or accounts maintained with a federal or state chartered depositoryinstitution or trust company which complies with the definition of EligibleInstitution or (b) a segregated trust account or accounts maintained with thecorporate trust department of a federal or state chartered depositoryinstitution or trust company acting in its fiduciary capacity which, in thecase of a federally chartered depository institution or trust company acting inits fiduciary capacity is subject to the regulations regarding adversary Fundson deposit therein under 12 CFR §9.10(b), and in the case of a state chartereddepository institution or trust company, is subject to regulationssubstantially similar to 12 C.F.R. §9.10(b), having in either case a combinedcapital surplus of at least $50,000,000 and subject to supervision orexamination by federal and state authority. An Eligible Account will not beevidenced by a certificate of deposit, passbook or other instrument.

 

**“Eligible Institution”**shall mean a depository institution or trustcompany insured by the Federal Deposit insurance Corporation, the short termunsecured debt obligations or commercial paper of which are rated at least “A-1”by S&P, “P-l” by Moody’s and “F-1” by Fitch in the case of accounts inwhich funds are held for thirty (30) days or less (or, in the case of accountsin which funds are held for more than thirty (30) days, the long term unsecureddebt obligations of which are rated at least “AA-” by Fitch and S&P (or “A-”by S&P, if such depository’s short

 

3

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termunsecured debt rating is at least “A-1” by S&P) and “Aa2” by Moody’s).Notwithstanding the foregoing, prior to a Securitization, Bank of America, N.A.shall be an Eligible Institution.

 

**“Embargoed Person”**shall mean any person identified by OFAC orany other Person with whom a Person resident in the United States of Americamay not conduct business or transactions by prohibition of federal law orExecutive Order of the President of the United States of America.

 

**“Environmental Indemnity”**shall mean that certain EnvironmentalIndemnity Agreement, dated as of the date hereof, executed by Borrower andBorrower Principal in connection with the Loan for the benefit of Lender, asthe same may be amended, restated, replaced, supplemented or otherwise modifiedfrom time to time.

 

**“Environmental Law”**shall have the meaning set forth in Section 12.5hereof. 

 

**“Environmental Liens”**shall have the meaning set forth in Section 12.5hereof. 

 

**“Environmental Report”**shall have the meaning set forth in Section 12.5hereof.

 

**“ERISA”**shall mean the Employee Retirement IncomeSecurity Act of 1974, as amended from time to time and any successor statutesthereto and applicable regulations issued pursuant thereto in temporary orfinal form.

 

**“Event of Default”**shall have the meaning set forth in Section 11.1hereof. 

 

**“Exchange Act”**shall mean the Securities and Exchange Act of1934, as amended. 

 

**“Fitch”**shall mean Fitch, Inc.

 

**“GAAP”**shall mean generally accepted accountingprinciples in the United States of America as of the date of the applicablefinancial report.

 

**“Governmental Authority”**shall mean any court, board, agency, department,commission, office or other authority of any nature whatsoever for anygovernmental unit (federal, state, county, municipal, city, town, specialdistrict or otherwise) whether now or hereafter in existence.

 

**“Guarantor”**shall mean any Person having a long-termunsecured debt rating above the Trigger Rating that may, from time to time, atthe option of American Express, execute a guaranty in favor of landlord underthe American Express Lease.

 

**“Hazardous Materials”**shall have the meaning set forth in Section 12.5hereof.

 

**“Improvements”**shall have the meaning set forth in thegranting clause of the Mortgage.

 

**“Indemnified Parties”**shall mean (a) Lender, (b) any prior owner orholder of the Loan or Participations in the Loan, (c) any servicer or prior servicerof the Loan, (d) any Investor or any prior Investor in any Securities, (e) anytrustees, custodians or other fiduciaries who hold or

 

4

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whohave held a full or partial interest in the Loan for the benefit of anyInvestor or other third party, (f) any receiver or other fiduciary appointed ina foreclosure or other Creditors Rights Laws proceeding, (g) any officers,directors, shareholders, partners, members, employees, agents, servants,representatives, contractors, subcontractors, affiliates or subsidiaries of anyand all of the foregoing, and (h) the heirs, legal representatives, successorsand assigns of any and all of the foregoing (including, without limitation, anysuccessors by merger, consolidation or acquisition of all or a substantialportion of the Indemnified Parties’ assets and business), in all cases whetherduring the term of the Loan or as part of or following a foreclosure of theMortgage.

 

**“Independent Director”**shall have the meaning set forth in Section 6.4(a).

 

**“Inland Permitted Transferee”**shall mean a newly-formed special purposeentity that is wholly-owned (directly or indirectly) by Inland Retail RealEstate Trust, Inc., a Maryland corporation; Inland Real Estate Corporation, a Marylandcorporation, Inland Real Estate Corporation, a Delaware corporation or BorrowerPrincipal.

 

**“Insurance Premiums”**shall have the meaning set forth in Section 8.1hereof. 

 

“**Insurance Proceeds”**shallhave the meaning set forth in Section 8.4(b) hereof.

 

**“Internal Revenue Code”**shall mean the Internal Revenue Code of 1986,as amended, as it may be further amended from time to time, and any successorstatutes thereto, and applicable U.S. Department of Treasury regulations issuedpursuant thereto in temporary or final form.

 

**“Investor”**shall have the meaning set forth in Section 13.3hereof. 

 

“**Lease**” shall havethe meaning set forth in the Mortgage.

 

**“Legal Requirements”**shall mean all statutes, laws, rules, orders,regulations, ordinances, judgments, decrees and injunctions of GovernmentalAuthorities affecting the Property or any part thereof, or the construction,use, alteration or operation thereof, whether now or hereafter enacted and inforce, and all permits, licenses, authorizations and regulations relatingthereto, and all covenants, agreements, restrictions and encumbrances containedin any instruments, either of record or known to Borrower, at any time in forceaffecting the Property or any part thereof, including, without limitation, anywhich may (a) require repairs, modifications or alterations in or to theProperty or any part thereof, or (b) in any way limit the use and enjoymentthereof.

 

**“Lien”**shall mean any mortgage, deed of trust, lien,pledge, hypothecation, assignment, security interest, or any other encumbrance,charge or transfer of, on or affecting Borrower, the Property, any portionthereof or any interest therein, including, without limitation, any conditionalsale or other title retention agreement, any financing lease having substantiallythe same economic effect as any of the foregoing, the filing of any financingstatement, and mechanic’s, materialmen’s and other similar liens andencumbrances.

 

**“LLC Agreement”**shall have the meaning set forth in Section 6.l(c).

 

5

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**“Loan”**shall mean the loan made by Lender toBorrower pursuant to this Agreement.

 

**“Loan Documents”**shall mean, collectively, this Agreement, theNote, the Mortgage, the Environmental Indemnity, the Assignment of ManagementAgreement and any and all other documents, agreements and certificates executedand/or delivered in connection with the Loan, as the same may be amended,restated, replaced, supplemented or otherwise modified from time to time.

 

**“Lockout Period”**shall mean the period commencing on the datehereof and ending on the date of the second anniversary hereof.

 

**“Losses”**shall mean any and all claims, suits,liabilities (including, without limitation, strict liabilities), actions,proceedings, obligations, debts, damages, losses, costs, expenses, fines,penalties, charges, fees, judgments, awards, amounts paid in settlement ofwhatever kind or nature (including but not limited to legal fees and othercosts of defense).

 

**“Management Agreement”**shall mean the management agreement enteredinto by and between Borrower and Manager, pursuant to which Manager is toprovide management and other services with respect to the Property, as the samemay be amended, restated, replaced, supplemented or otherwise modified in accordancewith the terms of this Agreement.

 

**“Manager”**shall mean Inland US Management LLC, aDelaware limited liability company or such other entity selected as the managerof the Property in accordance with the terms of this Agreement.

 

**“Material Litigation”**shall mean, with respect to any Person, anymaterial conviction, indictment (that is not dismissed before trial), judgment,litigation or regulatory action. For purposes of this definition, a mattershall be deemed material if it is reasonably foreseeable that a prudentinstitutional commercial real estate mortgage lender would consider such matteras a material adverse factor in its underwriting of the Person in question.With respect to non-criminal matters, isolated actions occurring more than five(5) years prior to the date of a proposed transfer shall not be deemed materialprovided that there is no indication of fraud, intentional misrepresentation orintent to defraud creditors with respect to such actions.

 

**“Maturity Date”**shall have the meaning set forth in the Note.

 

**“Maximum Legal Rate”**shall mean the maximum nonusurious interestrate, if any, that at any time or from time to time may be contracted for,taken, reserved, charged or received on the indebtedness evidenced by the Noteand as provided for herein or the other Loan Documents, under the laws of suchstate or states whose laws are held by any court of competent jurisdiction togovern the interest rate provisions of the Loan.

 

**“Member”**shall have the meaning set forth in Section 6.1(c).

 

**“Monthly Payment Amount”**shall mean the monthly payment of interestdue on each Scheduled Payment Date as set forth in the Note.

 

**“Moody’s”**shall mean Moody’s Investor Services, Inc.

 

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**“Mortgage”**shall mean that certain first prioritymortgage/deed of trust/deed to secure debt and security agreement dated thedate hereof, executed and delivered by Borrower as security for the Loan andencumbering the Property, as the same may be amended, restated, replaced,supplemented or otherwise modified from time to time.

 

**“Net****Proceeds****”**shallhave the meaning set forth in Section 8.4(b) hereof.

 

“**Net****Proceeds Deficiency****”**shall have the meaning set forth in Section 8.4(b)(vi)hereof.

 

**“****Note****”**shall mean that certain promissorynote of even date herewith in the principal amount of $33,040,000, made byBorrower in favor of Lender, as the same may be amended, restated, replaced,supplemented or otherwise modified from time to time.

 

**“Note Rate”**shall have the meaning set forth in the Note.

 

**“OFAC”**shall have the meaning set forth in Section 4.38hereof.

 

**“Operating Expenses”**shall mean, with respect to any period oftime, the total of all expenses actually paid or payable, computed inaccordance with federal tax basis accounting, or in accordance with othermethods acceptable to Lender in its sole discretion, of whatever kind relatingto the operation, maintenance and management of the Property, including,without limitation, utilities, ordinary repairs and maintenance, InsurancePremiums, license fees, Taxes and Other Charges, advertising expenses, payrolland related taxes, computer processing charges, management fees equal to thegreater of 4% of the Operating Income and the management fees actually payableunder the Management Agreement for such period of time, operational equipmentor other lease payments as approved by Lender, normalized capital expendituresbut specifically excluding depreciation and amortization, income taxes, DebtService, any incentive fees due under the Management Agreement, any item ofexpense that in accordance with federal tax basis accounting should becapitalized, any item of expense that would otherwise be covered by theprovisions hereof but which is paid by American Express under the American ExpressLease and deposits into the Reserve Accounts.

 

**“Optional Prepayment Date”**shall have the meaning set forth in the Note.

 

**“Other Charges”**shall mean all ground rents, maintenancecharges, impositions other than Taxes, and any other charges, including,without limitation, vault charges and license fees for the use of vaults,chutes and similar areas adjoining the Property, now or hereafter levied orassessed or imposed against the Property or any part thereof.

 

**“Participations”**shall have the meaning set forth in Section 13.1hereof.

 

**“Patriot Act”**shall have the meaning set forth in Section 4.38hereof.

 

**“Permitted Encumbrances’’**shall mean collectively, (a) the Lien andsecurity interests created by the Loan Documents, (b) all Liens, encumbrancesand other matters disclosed in the Title insurance Policy, (c) Liens, if any,for Taxes imposed by any Governmental Authority not yet due or delinquent, and(d) such other title and survey exceptions as Lender has approved or mayapprove in writing in Lender’s sole discretion.

 

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**“Permitted Investments”**shall mean to the extent available fromLender or Lender’s servicer for deposits in the Reserve Accounts and theLockbox Account, any one or more of the following obligations or securitiesacquired at a purchase price of not greater than par, including those issued bya servicer of the Loan, the trustee under any securitization or any of theirrespective Affiliates, payable on demand or having a maturity date not laterthan the Business Day immediately prior to the date on which the funds used toacquire such investment are required to be used under this Agreement andmeeting one of the appropriate standards set forth below:

 

(a)           obligations of, or obligations fullyguaranteed as to payment of principal and interest by, the United States or anyagency or instrumentality thereof provided such obligations are backed by thefull faith and credit of the United States of America including, without limitation,obligations of: the U.S. Treasury (all direct or fully guaranteed obligations),the Farmers Home Administration (certificates of beneficial ownership), theGeneral Services Administration (participation certificates), the U.S. MaritimeAdministration (guaranteed Title XI financing), the Small BusinessAdministration (guaranteed participation certificates and guaranteed poolcertificates), the U.S. Department of Housing and Urban Development (local authoritybonds) and the Washington Metropolitan Area Transit Authority (guaranteedtransit bonds); provided, however, that the investments described in thisclause must (i) have a predetermined fixed dollar of principal due at maturitythat cannot vary or change, (ii) be rated “AAA” or the equivalent by each ofthe Rating Agencies, (iii) if rated by S&P, must not have an “r”highlighter affixed to their rating, (iv) if such investments have a variablerate of interest, such interest rate must be tied to a single interest rateindex plus a fixed spread (if any) and must move proportionately with thatindex, and (v) such investments must not be subject to liquidation prior totheir maturity;

 

(b)           Federal Housing Administration debentures;

 

(c)           obligations of the following United Statesgovernment sponsored agencies: Federal Home Loan Mortgage Corp. (debtobligations), the Farm Credit System (consolidated systemwide bonds and notes),the Federal Home Loan Banks (consolidated debt obligations), the FederalNational Mortgage Association (debt obligations), the Financing Corp.  (debt obligations), and the ResolutionFunding Corp. (debt obligations); *provided,however,*that the investments described in this clause must (i) havea predetermined fixed dollar of principal due at maturity that cannot vary orchange, (ii) if rated by S&P, must not have an “r” highlighter affixed totheir rating, (iii) if such investments have a variable rate of interest, suchinterest rate must be tied to a single interest rate index plus a fixed spread(if any) and must move proportionately with that index, and (iv) suchinvestments must not be subject to liquidation prior to their maturity;

 

(d)           federal funds, unsecured certificates ofdeposit, time deposits, bankers’ acceptances and repurchase agreements withmaturities of not more than 365 days of any bank, the short term obligations ofwhich at all times are rated in the highest short term rating category by eachRating Agency (or, if not rated by all Rating Agencies, rated by at least oneRating Agency in the highest short term rating category and otherwiseacceptable to each other Rating Agency, as confirmed in writing that suchinvestment would not, in and of itself, result in a downgrade, qualification orwithdrawal of the initial, or, if higher, then current ratings assigned

 

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tothe Securities); provided, however, that the investments described in thisclause must (i) have a predetermined fixed dollar of principal due at maturitythat cannot vary or change, (ii) if rated by S&P, must not have an “r” highlighteraffixed to their rating, (iii) if such investments have a variable rate ofinterest, such interest rate must be tied to a single interest rate index plusa fixed spread (if any) and must move proportionately with that index, and (iv)such investments must not be subject to liquidation prior to their maturity;

 

(e)           fully Federal Deposit Insurance Corporation-insured demand and timedeposits in, or certificates of deposit of, or bankers’ acceptances withmaturities of not more than 365 days and issued by, any bank or trust company,savings and loan association or savings bank, the short term obligations ofwhich at all times are rated in the highest short term rating category by eachRating Agency (or, if not rated by all Rating Agencies, rated by at least oneRating Agency in the highest short term rating category and otherwiseacceptable to each other Rating Agency, as confirmed in writing that suchinvestment would not, in and of itself, result in a downgrade, qualification orwithdrawal of the initial, or, if higher, then current ratings assigned to theSecurities); provided, however, that the investments described in this clausemust (i) have a predetermined fixed dollar of principal due at maturity thatcannot vary or change, (ii) if rated by S&P, must not have an “r”highlighter affixed to their rating, (iii) if such investments have a variablerate of interest, such interest rate must be tied to a single interest rateindex plus a fixed spread (if any) and must move proportionately with that index,and (iv) such investments must not be subject to liquidation prior to theirmaturity;

 

(f)            debt obligations with maturities of not morethan 365 days and at all times rated by each Rating Agency (or, if not rated byall Rating Agencies, rated by at least one Rating Agency and otherwiseacceptable to each other Rating Agency, as confirmed in writing that suchinvestment would not, in and of itself, result in a downgrade, qualification orwithdrawal of the initial, or, if higher, then current ratings assigned to theSecurities) in its highest long-term unsecured rating category; provided,however, that the investments described in this clause must (i) have apredetermined fixed dollar of principal due at maturity that cannot vary orchange, (ii) if rated by S&P, must not have an “r” highlighter affixed totheir rating, (iii) if such investments have a variable rate of interest, suchinterest rate must be tied to a single interest rate index plus a fixed spread(if any) and must move proportionately with that index, and (iv) suchinvestments must not be subject to liquidation prior to their maturity;

 

(g)           commercial paper (including both non-interest-bearing discountobligations and interest-bearing obligations payable on demand or on aspecified date not more than one year after the date of issuance thereof) withmaturities of not more than 365 days and that at all times is rated by eachRating Agency (or, if not rated by all Rating Agencies, rated by at least oneRating Agency and otherwise acceptable to each other Rating Agency, asconfirmed in writing that such investment would not, in and of itself, resultin a downgrade, qualification or withdrawal of the initial, or, if higher, thencurrent ratings assigned to the Securities) in its highest short-term unsecureddebt rating; provided, however, that the investments described in this clausemust (i) have a predetermined fixed dollar of principal due at maturity thatcannot vary or change, (ii) if rated by S&P, must not have an “r”highlighter affixed to their rating, (iii) if such investments have a variablerate of interest, such interest rate must be tied to a single interest rateindex plus a fixed spread (if any) and must move proportionately with thatindex, and (iv) such investments must not be subject to liquidation prior to theirmaturity;

 

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(h)           units of taxable money market funds, with maturities of not more than365 days and which funds are regulated investment companies, seek to maintain aconstant net asset value per share and invest solely in obligations backed bythe full faith and credit of the United States, which funds have the highestrating available from each Rating Agency (or, if not rated by all RatingAgencies, rated by at least one Rating Agency and otherwise acceptable to eachother Rating Agency, as confirmed in writing that such investment would not, inand of itself, result in a downgrade, qualification or withdrawal of theinitial, or, if higher, then current ratings assigned to the Securities) formoney market funds; and

 

(i)            any other security, obligation or investmentwhich has been approved as a Permitted Investment in writing by (i) Lender and(ii) each Rating Agency, as evidenced by a written confirmation that thedesignation of such security, obligation or investment as a PermittedInvestment will not, in and of itself, result in a downgrade, qualification orwithdrawal of the initial, or, if higher, then current ratings assigned to theSecurities by such Rating Agency;

 

*provided, however,*that no obligation or security shall be aPermitted Investment if (A) such obligation or security evidences a right toreceive only interest payments, (B) the right to receive principal and interestpayments on such obligation or security are derived from an underlyinginvestment that provides a yield to maturity in excess of one hundred twentypercent (120%) of the yield to maturity at par of such underlying investment or(C) such obligation or security has a remaining term to maturity in excess ofone (1) year.

 

**“Person”**shall mean any individual, corporation,partnership, joint venture, limited liability company, estate, trust,unincorporated association, any federal, state, county or municipal governmentor any bureau, department or agency thereof and any fiduciary acting in suchcapacity on behalf of any of the foregoing.

 

**“Personal Property”**shall have the meaning set forth in thegranting clause of the Mortgage.

 

**“****Policies****”** shall have the meaning set forth in Section 8.1hereof. 

 

**“Prohibited Transfer”**shall have the meaning set forth in Section 7.2hereof.

 

**“Property”**shall mean the parcel of real property, theImprovements thereon and all Personal Property owned by Borrower and encumberedby the Mortgage, together with all rights pertaining to such property andImprovements, as more particularly described in the granting clause of theMortgage and referred to therein as the “Property”.

 

**“Property Condition Report”**shall mean a report prepared by a companysatisfactory to Lender regarding the physical condition of the Property,satisfactory in form and substance to Lender in its sole discretion.

 

**“Qualified Manager”**shall mean (a) Manager or (b) a reputable andexperienced professional management organization (i) which manages, togetherwith its affiliates, at least ten (10) first class office buildings totaling atleast 3,500,000 square feet of gross leasable area, exclusive of the Propertyand (ii) approved by Lender, which approval shall not have been unreasonablywithheld and for which Lender shall have received written confirmation from the

 

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RatingAgencies that the employment of such manager will not result in a downgrade,withdrawal or qualification of the initial, or if higher, then current ratingsissued in connection with a Securitization, or if a Securitization has notoccurred, any ratings to be assigned in connection with a Securitization.

 

**“Rating Agencies”**shall mean each of S&P, Moody’s and Fitch,or any other nationally-recognized statistical rating agency which has beenapproved by Lender.

 

**“REA”**shall mean any construction, operation and reciprocal easementagreement or similar agreement (including any separate agreement or otheragreement between Borrower and one or more other parties to an REA with respectto such REA) affecting the Property or portion thereof.

 

**“Release”**shall have the meaning set forth in Section 12.5hereof.

 

**“REMIC Trust”**shall mean a “real estate mortgage investmentconduit” (within the meaning of Section 860D, or applicable successorprovisions, of the Code) that holds the Note.

 

**“Rents”**shall have the meaning set forth in theMortgage. 

 

**“Replacements”**shall have the meaning set forth in Section 9.2(a)hereof. 

 

**“Required Repairs”**shall have the meaning set forth in Section 9.l(a)hereof. 

 

**“Reserve Accounts”**shall mean the Tax and Insurance ReserveAccount. 

 

**“Reserve Funds”**shall mean the Tax and Insurance ReserveFunds.

 

**“Restoration”**shall mean, following the occurrence of aCasualty or a Condemnation which is of a type necessitating the repair of theProperty, the completion of the repair and restoration of the Property asnearly as possible to the condition the Property was in immediately prior tosuch Casualty or Condemnation, with such alterations as may be reasonablyapproved by Lender.

 

**“Restoration Consultant”**shall have the meaning set forth in Section 8.4(b)(iii)hereof. 

 

**“Restoration Retainage”**shall have the meaning set forth in Section 8.4(b)(iv)hereof. 

 

**“Restricted Party”**shall have the meaning set forth in Section 7.1hereof. 

 

**“Sale or Pledge”**shall have the meaning set forth in Section 7.1hereof.

 

**“Scheduled Payment Date”**shall have the meaning set forth in the Note.

 

**“Securities”**shall have the meaning set forth in Section 13.1hereof. 

 

**“Securities Act”**shall mean the Securities Act of 1933, asamended. 

 

**“Securities Liabilities”**shall have the meaning set forth in Section 13.5hereof.

 

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**“Securitization”**shall have the meaning set forth in Section 13.1hereof. 

 

**“Special Member”**shall have the meaning set forth in Section 6.1(c).

 

**“****S&P****”** shall mean Standard & Poor’s RatingsServices, a division of The McGraw-Hill Companies, Inc.

 

**“State”**shall mean the state in which the Property orany part thereof is located.

 

**“Tax and Insurance Reserve Account”**shall have the meaning set forth in Section 9.6hereof.

 

**“Tax and Insurance Reserve Funds”**shall have the meaning set forth in Section 9.6hereof.

 

**“Taxes”**shall mean all real estate and personalproperty taxes, assessments, water rates or sewer rents, now or hereafterlevied or assessed or imposed against the Property or part thereof.

 

**“Tenant”**shall mean any Person leasing, subleasing orotherwise occupying any portion of the Property under a Lease or otheroccupancy agreement with Borrower, including, without limitation, AmericanExpress, as tenant under the American Express Lease.

 

**“Tenant Direction Letter”**shall have the meaning set forth in Section 10.2(a)(i)hereof.

 

**“Title Insurance Policy”**shall mean that certain ALTA mortgagee titleinsurance policy issued with respect to the Property and insuring the lien ofthe Mortgage.

 

**“Transferee”**shall have the meaning set forth in Section 7.5**hereof.

 

**“Trigger Rating”**shall mean the long-term unsecured debtrating of Guarantor (or American Express if there is no Guarantor) below BBB asissued by S&P or below Baa2 as issued by Moody’s.

 

**“UCC” or “Uniform Commercial Code”**shall mean the Uniform Commercial Code as ineffect in the State where the applicable Property is located.

 

**Section 1.2.****                               ****Principles of Construction.**

 

All references to sections and schedules are to sections and schedulesin or to this Agreement unless otherwise specified. All uses of the word “including”shall mean “including, without limitation” unless the context shall indicateotherwise. Unless otherwise specified, the words “hereof,” “herein” and “hereunder”and words of similar import when used in this Agreement shall refer to thisAgreement as a whole and not to any particular provision of this Agreement.Unless otherwise specified, all meanings attributed to defined terms hereinshall be equally applicable to both the singular and plural forms of the termsso defined.

 

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**ARTICLE 2 GENERAL TERMS**

 

**Section 2.1.****                               ****Loan Commitment;Disbursement to Borrower**

 

(a)            Subject to and upon the terms and conditionsset forth herein, Lender hereby agrees to make and Borrower hereby agrees toaccept the Loan on the Closing Date.

 

(b)           Borrower may request and receive only oneborrowing in respect of the Loan and any amount borrowed and repaid in respectof the Loan may not be reborrowed.

 

(c)            The Loan shall be evidenced by the Note andsecured by the Mortgage and the other Loan Documents.

 

(d)           Borrower shall use the proceeds of the Loanto (i) pay the purchase price for acquiring the Property, (ii) pay certaincosts and expenses incurred in connection with the closing of the Loan, asapproved by Lender, (iv) fund any working capital requirements of the Property,and (v) distribute the balance, if any, to its members.

 

**Section 2.2.****                               ****Loan Payments**

 

(a)           The Loan and interest shall be payable pursuant to the terms of theNote. 

 

**Section 2.3.****                               ****Prepayment**

 

The Loan may not be prepaid, in whole or in part, except in strictaccordance with the express terms and conditions of the Note.

 

**ARTICLE 3**

**CONDITIONS PRECEDENT**

 

The obligation of Lender to make the Loan hereunder is subject to thefulfillment by Borrower or waiver by Lender of all the conditions precedent toclosing set forth in the application or term sheet for the Loan delivered byBorrower to Lender and any commitment rider to the application for the Loanissued by Lender.

 

**ARTICLE 4 REPRESENTATIONS AND WARRANTIES**

 

Borrower and, where specifically indicated, each Borrower Principalrepresents and warrants to Lender as of the Closing Date that:

 

**Section 4.1.****                               ****Organization**

 

Borrower and each Borrower Principal (when not an individual) (a) hasbeen duly organized and is validly existing and in good standing with requisitepower and authority to own its properties and to transact the businesses inwhich it is now engaged, (b) is duly qualified to do business and is in goodstanding in each jurisdiction where it is required to be so qualified in

 

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connectionwith its properties, businesses and operations, (c) possesses all rights,licenses, permits and authorizations, governmental or otherwise, necessary toentitle it to own its properties and to transact the businesses in which it isnow engaged, and the sole business of Borrower is the ownership, management andoperation of the Property, and (d) in the case of Borrower, has full power,authority and legal right to mortgage, grant, bargain, sell, pledge, assign,warrant, transfer and convey the Property pursuant to the terms of the LoanDocuments, and in the case of Borrower and each Borrower Principal, has fullpower, authority and legal right to keep and observe all of the terms of theLoan Documents to which it is a party. Borrower and each Borrower Principalrepresent and warrant that the chart attached hereto as Exhibit A sets forth anaccurate listing of the direct and indirect owners of the equity interests inBorrower, and each Borrower Principal (when not an individual).

 

**Section 4.2.****                               ****Status of Borrower**

 

Borrower’s exact legal name is correctly set forth on the first page ofthis Agreement, on the Mortgage and on any UCC-1 Financing Statements filed inconnection with the Loan. Borrower is an organization of the type specified onthe first page of this Agreement. Borrower is organized under the laws of theState of Delaware. Borrower’s principal place of business and chief executiveoffice, and the place where Borrower keeps its books and records, includingrecorded data of any kind or nature, regardless of the medium of recording,including software, writings, plans, specifications and schematics, has beenfor the preceding four months (or, if less, the entire period of the existenceof Borrower) the address of Borrower set forth on the first page of thisAgreement. Borrower’s organizational identification number, if any, assigned bythe state of incorporation or organization is correctly set forth on the firstpage of the Note.

 

**Section 4.3.****                               ****Validity of Documents**

 

Borrower and Borrower Principal have taken all necessary action toauthorize the execution, delivery and performance of this Agreement and theother Loan Documents to which they are parties. This Agreement and such otherLoan Documents have been duly executed and delivered by or on behalf ofBorrower and Borrower Principal and constitute the legal, valid and bindingobligations of Borrower and Borrower Principal enforceable against Borrower andBorrower Principal in accordance with their respective terms, subject only toapplicable bankruptcy, insolvency and similar laws affecting rights ofcreditors generally, and subject, as to enforceability, to general principlesof equity (regardless of whether enforcement is sought in a proceeding inequity or at law).

 

**Section 4.4.****                               ****No Conflicts**

 

The execution, delivery and performance of this Agreement and the otherLoan Documents by Borrower and Borrower Principal will not conflict with orresult in a breach of any of the terms or provisions of, or constitute adefault under, or result in the creation or imposition of any lien, charge orencumbrance (other than pursuant to the Loan Documents) upon any of theproperty or assets of Borrower or Borrower Principal pursuant to the terms ofany agreement or instrument to which Borrower or Borrower Principal is a partyor by which any of Borrower’s or Borrower Principal’s property or assets issubject, nor will such action result in any violation of the provisions of anystatute or any order, rule or regulation of any

 

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GovernmentalAuthority having jurisdiction over Borrower or Borrower Principal or any ofBorrower’s or Borrower Principal’s properties or assets, and any consent,approval, authorization, order, registration or qualification of or with anyGovernmental Authority required for the execution, delivery and performance byBorrower or Borrower Principal of this Agreement or any of the other LoanDocuments has been obtained and is in full force and effect.

 

**Section 4.5.****                               ****Litigation**

 

There are no actions, suits or proceedings at law or in equity by orbefore any Governmental Authority or other agency now pending or, to Borrower’sor Borrower Principal’s knowledge, threatened against or affecting Borrower,Borrower Principal, Manager or the Property, which actions, suits orproceedings, if determined against Borrower, Borrower Principal, Manager or theProperty, would materially adversely affect the condition (financial orotherwise) or business of Borrower or Borrower Principal or the condition orownership of the Property.

 

**Section 4.6.****                               ****Agreements**

 

Borrower is not a party to any agreement or instrument or subject toany restriction which would materially and adversely affect Borrower or theProperty, or Borrower’s business, properties or assets, operations orcondition, financial or otherwise. Borrower is not in default in any materialrespect in the performance, observance or fulfillment of any of theobligations, covenants or conditions contained in any agreement or instrumentto which it is a party or by which Borrower or the Property is bound. Borrowerhas no material financial obligation under any agreement or instrument to whichBorrower is a party or by which Borrower or the Property is otherwise bound,other than (a) obligations incurred in the ordinary course of the operation ofthe Property and (b) obligations under the Loan Documents.

 

**Section 4.7.****                               ****Solvency**

 

Borrower and each Borrower Principal have (a) not entered into thetransaction or executed the Note, this Agreement or any other Loan Documentswith the actual intent to hinder, delay or defraud any creditor and (b)received reasonably equivalent value in exchange for their obligations undersuch Loan Documents. Giving effect to the Loan, the fair saleable value of theassets of Borrower and each Borrower Principal exceeds and will, immediatelyfollowing the making of the Loan, exceed the total liabilities of Borrower andBorrower Principal, including, without limitation, subordinated, unliquidated,disputed and contingent liabilities. No petition in bankruptcy has been filedagainst Borrower, Borrower Principal, or Affiliated Manager in the last ten(10) years, and neither Borrower nor Borrower Principal, or Affiliated Managerin the last ten (10) years has made an assignment for the benefit of creditorsor taken advantage of any Creditors Rights Laws. Neither Borrower nor BorrowerPrincipal, or Affiliated Manager is contemplating either the filing of apetition by it under any Creditors Rights Laws or the liquidation of all or amajor portion of Borrower’s assets or property, and Borrower has no knowledgeof any Person contemplating the filing of any such petition against Borrower orBorrower Principal, or Affiliated Manager.

 

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**Section 4.8.****                               ****Full and Accurate Disclosure**

 

No statement of fact made by or on behalf of Borrower or BorrowerPrincipal in this Agreement or in any of the other Loan Documents or in anyother document or certificate delivered by or on behalf of Borrower or BorrowerPrincipal contains any untrue statement of a material fact or omits to stateany material fact necessary to make statements contained herein or therein notmisleading. There is no material fact presently known to Borrower or BorrowerPrincipal which has not been disclosed to Lender which adversely affects, noras far as Borrower or Borrower Principal can reasonably foresee, mightadversely affect, the Property or the business, operations or condition(financial or otherwise) of Borrower or Borrower Principal.

 

**Section 4.9.****                               ****No Plan****Assets**

 

Borrower is not an “employee benefit plan,” as defined in Section 3(3)of ERISA, subject to Title I of ERISA, and none of the assets of Borrowerconstitutes or will constitute “plan assets” of one or more such plans withinthe meaning of 29 C.F.R. Section 2510.3-101. In addition, (a) Borrower isnot a “governmental plan” within the meaning of Section 3(32) of ERISA and(b) transactions by or with Borrower are not subject to state statutes regulatinginvestment of, and fiduciary obligations with respect to, governmental planssimilar to the provisions of Section 406 of ERISA or Section 4975 ofthe Internal Revenue Code currently in effect, which prohibit or otherwiserestrict the transactions contemplated by this Agreement.

 

**Section 4.10.****                        ****Not a Foreign Person**

 

Neither Borrower nor Borrower Principal is a “foreign Person” withinthe meaning of §1445(f)(3) of the Internal Revenue Code.

 

**Section 4.11.****                        ****Enforceability**

 

The Loan Documents are not subject to any right of rescission, set-off,counterclaim or defense by Borrower, including the defense of usury, nor wouldthe operation of any of the terms of the Loan Documents, or the exercise of anyright thereunder, render the Loan Documents unenforceable, and neither Borrowernor Borrower Principal has asserted any right of rescission, set-off,counterclaim or defense with respect thereto. No Default or Event of Defaultexists under or with respect to any Loan Document.

 

**Section 4.12.****                        ****Business Purposes**

 

The Loan is solely for the business purpose of Borrower, and is not forpersonal, family, household, or agricultural purposes.

 

**Section 4.13.****                        ****Compliance**

 

Except as expressly disclosed by Borrower to Lender in writing inconnection with the closing of the Loan, to Borrower’s knowledge, Borrower andthe Property, and the use and operation thereof, comply in all materialrespects with all Legal Requirements, including, without limitation, buildingand zoning ordinances and codes and the Americans with Disabilities Act. ToBorrower’s knowledge, Borrower is not in default or violation of any order,

 

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writ,injunction, decree or demand of any Governmental Authority and Borrower hasreceived no written notice of any such default or violation. There has not beencommitted by Borrower or, to Borrower’s knowledge, any other Person inoccupancy of or involved with the operation or use of the Property any act oromission affording any Governmental Authority the right of forfeiture asagainst the Property or any part thereof or any monies paid in performance ofBorrower’s obligations under any of the Loan Documents.

 

**Section 4.14.****                        ****Financial Information**

 

All financial data, including, without limitation, the balance sheets,statements of cash flow, statements of income and operating expense and rentrolls, that have been delivered to Lender in respect of Borrower, BorrowerPrincipal and/or the Property (a) are true, complete and correct in allmaterial respects, (b) accurately represent the financial condition ofBorrower, Borrower Principal or the Property, as applicable, as of the date ofsuch reports, and (c) to the extent prepared or audited by an independentcertified public accounting firm, have been prepared in accordance with taxbasis accounting throughout the periods covered, except as disclosed therein.Borrower does not have any contingent liabilities, liabilities for taxes,unusual forward or long-term commitments or unrealized or anticipated lossesfrom any unfavorable commitments that are known to Borrower and reasonablylikely to have a material adverse effect on the Property or the current and/orintended operation thereof, except as referred to or reflected in saidfinancial statements. Since the date of such financial statements, there hasbeen no materially adverse change in the financial condition, operations orbusiness of Borrower or Borrower Principal from that set forth in saidfinancial statements.

 

**Section 4.15.****                        ****Condemnation**

 

No Condemnation or other proceeding has been commenced or, to Borrower’sbest knowledge, is threatened or contemplated with respect to all or anyportion of the Property or for the relocation of roadways providing access tothe Property.

 

**Section 4.16.****                        ****Utilities and Public Access;Parking**

 

To the best of Borrower’s knowledge, the Property has adequate rightsof access to public ways and is served by water, sewer, sanitary sewer andstorm drain facilities adequate to service the Property for full utilization ofthe Property for its intended uses. All public utilities necessary to the fulluse and enjoyment of the Property as currently used and enjoyed are locatedeither in the public right-of-way abutting the Property (which are connected soas to serve the Property without passing over other property) or in recordedeasements serving the Property and such easements are set forth in and insuredby the Title Insurance Policy. All roads necessary for the use of the Propertyfor its current purposes have been completed and dedicated to public use andaccepted by all Governmental Authorities. The Property has, or is served by,parking to the extent required to comply with all Legal Requirements.

 

**Section 4.17.****                        ****Separate Lots**

 

The Property is assessed for real estate tax purposes as one or morewholly independent tax lot or lots, separate from any adjoining land orimprovements not constituting a part of such

 

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lotor lots, and no other land or improvements is assessed and taxed together withthe Property or any portion thereof.

 

**Section 4.18.****                        ****Assessments**

 

To Borrower’s knowledge, there are no pending or proposed special orother assessments for public improvements or otherwise affecting the Property,nor are there any contemplated improvements to the Property that may result insuch special or other assessments.

 

**Section 4.19.****                        ****Insurance**

 

Borrower has obtained and has delivered to Lender either (a) certifiedcopies of all Policies or, to the extent such Policies are not available as ofthe Closing Date, certificates of insurance with respect to all such Policiesreflecting the insurance coverages, amounts and other requirements set forth inthis Agreement or (b) the certificate of American Express that American Expressis a self-insurer with respect to the occurrences referred to in Section 8.1and that the rating of American Express by the Rating Agencies has not fallenbelow the Trigger Rating.

 

**Section 4.20.****                        ****Use of Property**

 

The Property is used exclusively for general office purposes and otherappurtenant and related uses.

 

**Section 4.21.****                        ****Certificate of Occupancy;Licenses**

 

All certificates of occupancy and to Borrower’s knowledge allcertifications, permits, licenses and approvals, including, without limitation,certificates of completion and any applicable liquor license required for thelegal use, occupancy and operation of the Property for the purpose intendedherein, have been obtained and are valid and in full force and effect. Borrowershall keep and maintain (or require American Express to maintain) all licensesnecessary for the operation of the Property for the purpose intended herein.The use being made of the Property is in conformity with the final certificateof occupancy (or compliance, if applicable) and any other permits or licensesissued for the Property.

 

**Section 4.22.**                         **Flood Zone**

 

None of the Improvements on the Property are located in an areaidentified by the Federal Emergency Management Agency as an area having specialflood hazards, or, if any portion of the Improvements is located within sucharea, Borrower will obtain or cause American Express to obtain the insuranceprescribed in Section 8.1(a)(i) at any time during the term of the Loanwhen American Express ceases to be a self-insurer or when the rating ofAmerican Express by the Rating Agencies falls below the Trigger Rating.

 

**Section 4.23.****                        ****Physical Condition**

 

Except as set forth in the Property Condition Report, to Borrower’sknowledge, the Property, including, without limitation, all buildings,improvements, parking facilities,

 

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sidewalks,storm drainage systems, roofs, plumbing systems, HVAC systems, fire protectionsystems, electrical systems, equipment, elevators, exterior sidings and doors,landscaping, irrigation systems and all structural components, are in goodcondition, order and repair in all material respects. Except as set forth inthe Property Condition Report, to Borrower’s knowledge, there exist nostructural or other material defects or damages in the Property, as a result ofa Casualty or otherwise, and whether latent or otherwise. Borrower has notreceived notice from any insurance company or bonding company of any defects orinadequacies in the Property, or any part thereof, which would adversely affectthe insurability of the same or cause the imposition of extraordinary premiumsor charges thereon or of any termination or threatened termination of anypolicy of insurance or bond.

 

**Section 4.24.****                        ****Boundaries; Survey**

 

(a)                                   None of the Improvements which were includedin determining the appraised value of the Property lie outside the boundariesand building restriction lines of the Property to any material extent, and (b)no improvements on adjoining properties encroach upon the Property and noeasements or other encumbrances upon the Property encroach upon any of theImprovements so as to materially affect the value or marketability of theProperty.

 

**Section 4.25.****                        ****Leases**

 

The entire Property has been leased to American Express pursuant to theAmerican Express Lease. (a) The American Express Lease is in full force andeffect; (b) the premises demised under the American Express Lease have beencompleted and American Express has accepted possession of and is in occupancyof the demised premises; (c) American Express has commenced the payment of rentunder the American Express Lease, there are no offsets, claims or defenses tothe enforcement thereof and Borrower has no monetary obligations to AmericanExpress under the American Express Lease; (d) all Rents due and payable underthe American Express Lease have been paid and no portion thereof has been paidfor any period more than thirty (30) days in advance; (e) the rent payableunder the American Express Lease is the amount of fixed rent set forth in theAmerican Express Lease, and there is no claim or basis for a claim by AmericanExpress thereunder for an adjustment to the Rent; (f) Borrower is the soleowner of the entire landlord’s interest in the American Express Lease; (g) theAmerican Express Lease is the valid, binding and enforceable obligation ofBorrower and American Express thereunder and there are no agreements withAmerican Express with respect to the American Express Lease other than asexpressly set forth therein; (h) no Person has any possessory interest in, orright to occupy, the Property or any portion thereof except under the AmericanExpress Lease; (i) except for the right of first refusal set forth in Article 4and the right to offer to purchase the Property under Article 12, theAmerican Express Lease does not contain any option or offer to purchase orright of first refusal to purchase the Property or any part thereof; and (j)neither the American Express Lease nor the Rents have been assigned or pledgedexcept to Lender, and no other Person has any interest therein.

 

**Section 4.26.****                        ****Filing and Recording Taxes**

 

All mortgage, mortgage recording, stamp, intangible or other similartax required to be paid by any Person under applicable Legal Requirementscurrently in effect in connection with

 

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theexecution, delivery, recordation, filing, registration, perfection orenforcement of any of the Loan Documents, including, without limitation, theMortgage, have been paid or will be paid, and, under current LegalRequirements, the Mortgage is enforceable in accordance with its terms byLender (or any subsequent holder thereof).

 

**Section 4.27.****                        ****Management Agreement**

 

The Management Agreement is in full force and effect and there is nodefault thereunder by any party thereto and, to Borrower’s knowledge, no eventhas occurred that, with the passage of time and/or the giving of notice, wouldconstitute a default thereunder. No management fees under the ManagementAgreement are accrued and unpaid.

 

**Section 4.28.****                        ****Illegal Activity**

 

No portion of the Property has been or will be purchased with proceedsof any illegal activity, and no part of the proceeds of the Loan will be usedin connection with any illegal activity.

 

**Section 4.29.****                        ****Construction Expenses**

 

All costs and expenses of any and all labor, materials, supplies andequipment used in the construction, maintenance or repair of the Improvementshave been paid in full. To Borrower’s knowledge after due inquiry, there are noclaims for payment for work, labor or materials affecting the Property whichare or may become a lien prior to, or of equal priority with, the Liens createdby the Loan Documents.

 

**Section 4.30.****                        ****Personal Property**

 

Borrower has paid in full for, and is the owner of, all PersonalProperty (other than tenants’ property) used in connection with the operationof the Property, free and clear of any and all security interests, liens orencumbrances, except for Permitted Encumbrances and the Lien and securityinterest created by the Loan Documents.

 

**Section 4.31.****                        ****Taxes**

 

Borrower and Borrower Principal have filed all federal, state, county,municipal, and city income, personal property and other tax returns required tohave been filed by them and have paid all taxes and related liabilities whichhave become due pursuant to such returns or pursuant to any assessmentsreceived by them. Neither Borrower nor Borrower Principal knows of any basisfor any additional assessment in respect of any such taxes and relatedliabilities for prior years.

 

**Section 4.32.****                        ****Permitted Encumbrances**

 

None of the Permitted Encumbrances, individually or in the aggregate,materially interferes with the benefits of the security intended to be providedby the Loan Documents, materially and adversely affects the value of theProperty, impairs the use or the operation of the Property or impairs Borrower’sability to pay its obligations in a timely manner.

 

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**Section 4.33.****                        ****Federal Reserve Regulations**

 

Borrower will use the proceeds of the Loan for the purposes set forthin Section 2.1(d) hereof and not for any illegal activity. No part of theproceeds of the Loan will be used for the purpose of purchasing or acquiringany “margin stock” within the meaning of Regulation U of the Board of Governorsof the Federal Reserve System or for any other purpose which would beinconsistent with such Regulation U or any other Regulations of such Board ofGovernors, or for any purposes prohibited by Legal Requirements or prohibitedby the terms and conditions of this Agreement or the other Loan Documents.

 

**Section 4.34.****                        ****Investment Company Act**

 

Borrower is not (a) an “investment company” or a company “controlled”by an “investment company,” within the meaning of the Investment Company Act of1940, as amended; (b) a “holding company” or a “subsidiary company” of a “holdingcompany” or an “affiliate” of either a “holding company” or a “subsidiarycompany” within the meaning of the Public Utility Holding Company Act of 1935,as amended; or (c) subject to any other federal or state law or regulationwhich purports to restrict or regulate its ability to borrow money.

 

**Section 4.35.****                        ****Reciprocal EasementAgreements**

 

(a)           Neither Borrower nor any other party iscurrently in default (nor has any notice been given or received with respect toan alleged or current default) under any of the terms and conditions of theREA, and the REA remains unmodified and in full force and effect;

 

(b)           All easements granted pursuant to the REAwhich were to have survived the site preparation and completion of construction(to the extent that the same has been completed), remain in full force andeffect and have not been released, terminated, extinguished or discharged byagreement or otherwise;

 

(c)           To the best of Borrower’s knowledge, all sumsdue and owing by Borrower to the other parties to the REA (or by the otherparties to the REA to the Borrower) pursuant to the terms of the REA, includingwithout limitation, all sums, charges, fees, assessments, costs, and expensesin connection with any taxes, site preparation and construction,non-shareholder contributions, and common area and other property managementactivities have been paid, are current, and no lien has attached on theProperty (or threat thereof been made) for failure to pay any of the foregoing;

 

(d)           The terms, conditions, covenants, uses andrestrictions contained in the REA do not conflict in any manner with any terms,conditions, covenants, uses and restrictions contained in any Lease or in anyagreement between Borrower and occupant of any peripheral parcel, includingwithout limitation, conditions and restrictions with respect to kioskplacement, tenant restrictions (type, location or exclusivity), sale of certaingoods or services, and/or other use restrictions; and

 

(e)           The terms, conditions, covenants, uses andrestrictions contained in the American Express Lease do not conflict in anymanner with any terms, conditions, covenants, uses and restrictions containedin the REA, any other lease or in any agreement between Borrower and

 

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occupantof any peripheral parcel, including without limitation, conditions andrestrictions with respect to kiosk placement, tenant restrictions (type,location or exclusivity), sale of certain goods or services, and/or other userestrictions.

 

**Section 4.36.****                        ****No Change in Facts orCircumstances; Disclosure**

 

All information submitted by Borrower or its agents to Lender and inall financial statements, reports, certificates and other documents submittedin connection with the Loan or in satisfaction of the terms thereof and allstatements of fact made by Borrower in this Agreement or in any other LoanDocument, are accurate, complete and correct in all material respects. Therehas been no material adverse change in any condition, fact, circumstance orevent that would make any such information inaccurate, incomplete or otherwisemisleading in any material respect or that otherwise materially and adverselyaffects or might materially and adversely affect the Property or the businessoperations or the financial condition of Borrower. Borrower has disclosed toLender all material facts and has not failed to disclose any material fact thatcould cause any representation or warranty made herein to be materiallymisleading.

 

**Section 4.37.****                        ****Intellectual Property**

 

All trademarks, trade names and service marks necessary to the businessof Borrower as presently conducted or as Borrower contemplates conducting itsbusiness are in good standing and, to the extent of Borrower’s actualknowledge, uncontested. Borrower has not infringed, is not infringing, and hasnot received notice of infringement with respect to asserted trademarks, trade names and service marks of others. ToBorrower’s knowledge, there is no infringement by others of trademarks, tradenames and service marks of Borrower.

 

**Section 4.38.****                        ****Compliance withAnti-Terrorism Laws**

 

None of Borrower, Borrower Principal or any Person who ControlsBorrower or Borrower Principal currently is identified by the Office of ForeignAssets Control, Department of the Treasury (“**OFAC**”)or otherwise qualifies as an Embargoed Person, and Borrower has implementedprocedures to ensure that no Person who now or hereafter owns a material director indirect equity interest in Borrower is an Embargoed Person or is Controlledby an Embargoed Person. To Borrower’s knowledge neither Borrower nor BorrowerPrincipal is in violation of any applicable law relating to anti-moneylaundering or anti-terrorism, including, without limitation, those related totransacting business with Embargoed Persons or the requirements of the Unitingand Strengthening America by Providing Appropriate Tools Required to Interceptand Obstruct Terrorism Act of 2001, U.S. Public Law 107-56, and the related regulationsissued thereunder, including temporary regulations (collectively, as the samemay be amended from time to time, the **“PatriotAct”**). To the best of Borrower’s knowledge, no tenant at theProperty is currently identified by OFAC or otherwise qualifies as an EmbargoedPerson, or is owned or Controlled by an Embargoed Person.

 

**Section ****4.39.****                        ****Patriot Act**

 

Neither Borrower nor Borrower Principal shall (a) be or become subjectat any time to any law, regulation, or list of any government agency(including, without limitation, the list maintained by OFAC and accessiblethrough the OFAC website) that prohibits or limits any

 

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lenderfrom making any advance or extension of credit to Borrower or from otherwise conductingbusiness with Borrower and Borrower Principal, or (b) fail to providedocumentary and other evidence of Borrower’s identity as may be requested byany lender at any time to enable any lender to verify Borrower’s identity or tocomply with any applicable law or regulation, including, without limitation,the Patriot Act. In addition, Borrower hereby agrees to provide to Lender anyadditional information that Lender deems necessary from time to time in orderto ensure compliance with all applicable laws concerning money laundering andsimilar activities.

 

**Section 4.40.****                        ****Survival**

 

Borrower agrees that, unless expressly provided otherwise, all of therepresentations and warranties of Borrower set forth in this Article 4 andelsewhere in this Agreement and in the other Loan Documents shall survive forso long as any portion of the Debt remains owing to Lender. Allrepresentations, warranties, covenants and agreements made in this Agreement orin the other Loan Documents by Borrower shall be deemed to have been reliedupon by Lender notwithstanding any investigation heretofore or hereafter madeby Lender or on its behalf.

 

**ART1CLE 5**

**BORROWER****COVENANTS**

 

From the date hereof and until repayment of the Debt in full andperformance in full of all obligations of Borrower under the Loan Documents orthe earlier release of the Lien of the Mortgage (and all related obligations)in accordance with the terms of this Agreement and the other Loan Documents,Borrower hereby covenants and agrees with Lender that:

 

**Section 5.1.****                               ****Existence; Compliance withLegal Requirements**

 

(a)           Borrower shall do or cause to be done allthings necessary to preserve, renew and keep in full force and effect itsexistence, rights, licenses, permits and franchises and comply with all LegalRequirements applicable to it and the Property. Borrower hereby covenants and agreesnot to commit, permit or suffer to exist any act or omission affording anyGovernmental Authority the right of forfeiture as against the Property or anypart thereof or any monies paid in performance of Borrower’s obligations underany of the Loan Documents. Borrower shall at all times maintain, preserve andprotect all franchises and trade names used in connection with the operation ofthe Property. So long as American Express is in compliance with the terms ofthe American Express Lease with respect to the matters described in this Section 5.1,Borrower shall be deemed in compliance with this Section 5.1.

 

(b)           Borrower, at its own expense, may contest orpermit American Express to contest by appropriate legal proceeding, promptlyinitiated and conducted in good faith and with due diligence, the LegalRequirements affecting the Property, provided that (i) no Default or Event of Defaulthas occurred and is continuing; (ii) such proceeding shall be permitted underand be conducted in accordance with the provisions of any other instrument towhich Borrower or the Property is subject and shall not constitute a defaultthereunder; (iii) neither the Property, any part thereof or interest therein,any of the tenants or occupants thereof, nor Borrower shall be affected in anymaterial adverse way as a result of such proceeding; (iv) non-compliance withthe

 

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LegalRequirements shall not impose civil or criminal liability on Borrower orLender; (v) unless the contest is initiated and conducted by American Expresspursuant to the American Express Lease Borrower shall have furnished thesecurity as may be required in the proceeding or by Lender to ensure complianceby Borrower with the Legal Requirements; and (vi) if the contest is initiatedand conducted by Borrower, Borrower shall have furnished to Lender all otheritems reasonably requested by Lender. Borrower shall give written notice to Lenderof any contest initiated and conducted by Borrower promptly after initiationthereof and shall inform Lender of any contest initiated and conducted byAmerican Express of which Borrower is given notice by American Express.

 

**Section ****5.2.****                               ****Maintenance and Use ofProperty**

 

Borrower shall cause the Property to be maintained in a good and safecondition and repair. The Improvements and the Personal Property shall not beremoved, demolished or except as may be expressly permitted under the AmericanExpress Lease without the consent of the landlord thereunder, materiallyaltered (except for normal replacement of the Personal Property) without theprior written consent of Lender. So long as American Express is in compliancewith the terms of the American Express Lease with respect to the mattersdescribed in this Section 5.2, Borrower shall be deemed in compliance withthis Section 5.2. If under applicable zoning provisions the use of all orany portion of the Property is or shall become a nonconforming use, Borrowerwill not cause or permit the nonconforming use to be discontinued or thenonconforming Improvement to be abandoned without the express written consentof Lender.

 

**Section 5.3.****                               ****Waste**

 

Borrower shall not commit or suffer any waste of the Property or make anychange in the use of the Property which will in any way materially increase therisk of fire or other hazard arising out of the operation of the Property, ortake any action that might invalidate or give cause for cancellation of anyPolicy, or do or permit to be done thereon anything that may in any way impairthe value of the Property or the security for the Loan. Borrower will not,without the prior written consent of Lender, permit any drilling or explorationfor or extraction, removal, or production of any minerals from the surface orthe subsurface of the Property, regardless of the depth thereof or the methodof mining or extraction thereof.

 

**Section 5.4.****                               ****Taxes and Other Charges**

 

(a)                                   Borrower shall pay or cause American Expressto pay all Taxes and Other Charges now or hereafter levied or assessed orimposed against the Property or any part thereof as the same become due andpayable. Borrower shall furnish or cause to be furnished to Lender suchreceipts for the payment of the Taxes and the Other Charges as are delivered toBorrower by American Express and, upon request by Lender, a certificate fromBorrower and Borrower Principal that as of the date of such certificate thereare no liens filed against the Property arising from the non-payment of Taxesor Other Charges. Borrower shall not suffer nor permit American Express tosuffer and shall promptly cause to be paid and discharged any Lien or chargewhatsoever which may be or become a Lien or charge against the Property, andshall promptly pay for all utility services provided to the Property. So longas American Express is in

 

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compliance with the terms of the American Express Lease with respect tothe matters described in this Section 5.4, Borrower shall be deemed incompliance with this Section 5.4.

 

(b)           Borrower, at its own expense, may contest or permit American Express tocontest by appropriate legal proceeding, promptly initiated and conducted ingood faith and with due diligence, the amount or validity or application inwhole or in part of any Taxes or Other Charges, provided that (i) no Default orEvent of Default has occurred and remains uncured; (ii) such proceeding shallbe permitted under and be conducted in accordance with the provisions of anyother instrument to which Borrower is subject and shall not constitute adefault thereunder and such proceeding shall be conducted in accordance withall applicable Legal Requirements; (iii) neither the Property nor any partthereof or interest therein will be in danger of being sold, forfeited,terminated, canceled or lost; (iv) Borrower shall promptly upon finaldetermination thereof pay the amount of any such Taxes or Other Charges,together with all costs, interest and penalties which may be payable inconnection therewith; (v) such proceeding shall suspend the collection of suchcontested Taxes or Other Charges from the Property; and (vi) Borrower shallfurnish or cause American Express to furnish (but only to the extent requiredto be furnished by American Express under the American Express Lease) suchsecurity as may be required in the proceeding, or deliver to Lender suchreserve deposits as may be requested by Lender, to insure the payment of anysuch Taxes or Other Charges, together with all interest and penalties thereon(unless Borrower or American Express has paid all of the Taxes or Other Chargesunder protest). Lender may pay over any such cash deposit or part thereof heldby Lender to the claimant entitled thereto at any time when, in the judgment ofLender, the entitlement of such claimant is established or the Property (orpart thereof or interest therein) shall be in danger of being sold, forfeited,terminated, canceled or lost or there shall be any danger of the Lien of theMortgage being primed by any related Lien.

 

**Section 5.5.****                               ****Litigation**

 

Borrower shall give prompt written notice to Lender of any litigationor governmental proceedings pending or threatened in writing against Borrowerwhich might materially adversely affect Borrower’s condition (financial orotherwise) or business or the Property.

 

**Section 5.6.****                               ****Access to Property**

 

Borrower shall permit agents, representatives and employees of Lenderto inspect the Property or any part thereof at reasonable hours upon reasonableadvance notice, subject to the rights of American Express under the AmericanExpress Lease.

 

**Section 5.7.****                               ****Notice of Default**

 

Borrower shall promptly advise Lender of any material adverse change inthe condition (financial or otherwise) of Borrower, any Borrower Principal orthe Property or of the occurrence of any Default or Event of Default of whichBorrower has knowledge and of any American Express Lease Default of whichBorrower has knowledge.

 

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**Section 5.8.****                               ****Cooperate in LegalProceedings**

 

Borrower shall at Borrower’s expense cooperate fully with Lender withrespect to any proceedings before any court, board or other GovernmentalAuthority which may in any way affect the rights of Lender hereunder or anyrights obtained by Lender under any of the other Loan Documents and, inconnection therewith, permit Lender, at its election, to participate in anysuch proceedings.

 

**Section 5.9.****                               ****Performance by Borrower**

 

Borrower shall in a timely manner observe, perform and fulfill each andevery covenant, term and provision to be observed and performed by Borrowerunder this Agreement and the other Loan Documents and any other agreement orinstrument affecting or pertaining to the Property and any amendments, modificationsor changes thereto.

 

**Section 5.10.****                        ****Awards; Insurance Proceeds**

 

Borrower shall cooperate with Lender in obtaining for Lender thebenefits of any Awards or Insurance Proceeds lawfully or equitably payable toBorrower in connection with the Property, and Lender shall be reimbursed forany expenses incurred in connection therewith (including reasonable, actualattorneys’ fees and disbursements, and the payment by Borrower of the expenseof an appraisal on behalf of Lender in case of a Casualty or Condemnationaffecting the Property or any part thereof) out of such Awards or InsuranceProceeds. The actual payment of any Awards shall be governed by Section 8.4hereof.

 

**Section 5.11.****                        ****Financial Reporting**

 

(a)                                   Borrower and Borrower Principal shall keep adequatebooks and records of account in accordance with federal tax basis accounting,or in accordance with other methods acceptable to Lender in its solediscretion, consistently applied and shall furnish to Lender:

 

(i)                                     prior to a Securitization, at the request ofLender, monthly, and following a Securitization, quarterly and annualcertificates signed and dated by Borrower, certifying that the American ExpressLease is in full force and effect, whether any defaults (or any matter that,with the passage of time or the giving of notice, could become a default) existthereunder and any other information as is reasonably required by Lender,within twenty (20) days after the end of each calendar month, thirty (30) daysafter the end of each fiscal quarter or one hundred twenty (120) days after theclose of each fiscal year of Borrower, as applicable;

 

(ii)                                  prior to a Securitization, at the request ofLender, monthly, and following a Securitization, quarterly and annual operatingstatements of the Property, prepared and certified by Borrower in the formrequired by Lender, detailing the revenues received, the expenses incurred andthe net operating income before and after debt service (principal and interest)and major capital improvements (including, without limitation, any capitalimprovements planned by American Express of which Borrower has notice) for theperiod of calculation and containing appropriate year-to-date information,within twenty (20) days after the end of each calendar month, thirty (30) daysafter the end of each

 

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fiscal quarter or one hundred (120) days after the close of each fiscalyear of Borrower, as applicable;

 

(iii)                               annual balance sheets, profit and loss statements, statements of cashflows, and statements of change in financial position of Borrower and BorrowerPrincipal in the form required by Lender prepared and certified by Borrower andBorrower Principal within one hundred twenty (120) days after the close of eachfiscal year of Borrower and Borrower Principal, as the case may be (providedthat with respect to Borrower, such statements may be delivered by theholder(s) of beneficial interests in Borrower in accordance with Section 6.1(a)(viii);and

 

(iv)                              all financial statements, operating statements, budgets, capital repairestimates or projections and certifications of any kind with respect to theforegoing delivered to Borrower by American Express under the American ExpressLease.

 

(b)                                 To the extent not inconsistent with the provisionsof Section 5.11(a) hereof (e.g., GAAP accounting and audits shall not berequired ), Borrower and Borrower Principal shall furnish Lender with suchother additional financial or management information (including state andfederal tax returns) as may, from time to time, be reasonably required byLender in form and substance satisfactory to Lender (including, withoutlimitation, any financial reports required to be delivered by any Tenant or anyguarantor of any Lease pursuant to the terms of such Lease), and shall furnishto Lender and its agents convenient facilities for the examination and audit ofany such books and records

 

(c)                                  Without limiting any other rights availableto Lender under this Loan Agreement or any of the other Loan Documents, in theevent Borrower shall fail to timely furnish Lender any financial document orstatement in accordance with this Section 5.11, Borrower shall promptlypay to Lender a non-refundable charge in the amount of $500 for each suchfailure. The payment of such amount shall not be construed to relieve Borrowerof any Event of Default hereunder arising from such failure.

 

(d)                                 All items requiring the certification ofBorrower shall, except where Borrower is an individual, require a certificateexecuted by the general partner, managing member or chief executive officer ofBorrower, as applicable (and the same rules shall apply to any sole shareholder,general partner or managing member which is not an individual).

 

**Section 5.12.****                        ****Estoppel Statement**

 

(a)                                  After request by Lender, Borrower shallwithin ten (10) Business Days furnish Lender with a statement, dulyacknowledged and certified, setting forth (i) the amount of the originalprincipal amount of the Note, (ii) the rate of interest on the Note, (iii) theunpaid principal amount of the Note, (iv) the date installments of interestand/or principal were last paid, (v) any offsets or defenses to the payment ofthe Debt, if any, and (vi) that the Note, this Agreement, the Mortgage and theother Loan Documents are valid, legal and binding obligations and have not beenmodified or if modified, giving particulars of such modification.

 

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(b)                                 Borrower shall use its best efforts todeliver to Lender, promptly upon request, a duly executed estoppel certificatefrom American Express on the form attached to the American Express Lease as anexhibit.

 

**Section 5.13.****                        ****Leasing Matters.**

 

(a)                                   Borrower (i) shall observe and perform allthe obligations imposed on the landlord under the American Express Lease andshall not do or permit to be done anything to impair the value of the AmericanExpress Lease as security for the Debt; (ii) shall promptly send copies toLender of all notices of default which Borrower shall send or receivethereunder; (iii) shall enforce all of the material terms, covenants andconditions contained in the American Express Lease on the part of the tenantthereunder to be observed or performed; (iv) shall not collect any of the Rentsmore than one (1) month in advance; (v) shall not execute any other assignmentof the landlord’s interest in the American Express Lease or the Rents; and (vi)shall not consent to any assignment of or subletting under the American ExpressLease not in accordance with its terms without the prior written consent ofLender.

 

(b)                                  Borrower shall not, without the prior writtenconsent of Lender, enter into, renew, extend, amend, modify, waive anyprovisions of, terminate, reduce Rents under, accept a surrender of space underor shorten the term of the American Express Lease.

 

**Section 5.14.****                        ****Property Management**

 

(a)                                      Borrower shall (i) promptly perform andobserve all of the covenants required to be performed and observed by it underthe Management Agreement and do all things necessary to preserve and to keepunimpaired its material rights thereunder; (ii) promptly notify Lender of anydefault under the Management Agreement of which it is aware; (iii) promptlydeliver to Lender a copy of any notice of default or other material noticereceived by Borrower under the Management Agreement; (iv) promptly give noticeto Lender of any notice or information that Borrower receives which indicatesthat Manager is terminating the Management Agreement or that Manager isotherwise discontinuing its management of the Property; and (v) promptly enforcethe performance and observance of all of the covenants required to be performedand observed by Manager under the Management Agreement.

 

(b)                                     If at any time, (i) Manager shall becomeinsolvent or a debtor in a bankruptcy proceeding; (ii) an Event of Default hasoccurred and is continuing; or (iii) a default has occurred and is continuingafter the expiration of any applicable cure periods under the Management Agreement,Borrower shall, at the request of Lender, terminate the Management Agreement uponthirty (30) days prior notice to Manager and replace Manager with a QualifiedManager, it being understood and agreed that the management fee for suchreplacement manager shall not exceed then prevailing market rates.

 

(c)                                      In addition to the foregoing, in the eventthat Lender, in Lender’s reasonable discretion, at any time prior to thetermination of the Assignment of Management Agreement, determines that theProperty is not being managed in accordance with generally accepted managementpractices for projects similarly situated, Lender may deliver written noticethereof to Borrower and Manager, which notice shall specify with particularitythe grounds for Lender’s

 

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determination.If Lender reasonably determines that the conditions specified in Lender’snotice are not remedied to Lender’s reasonable satisfaction by Borrower orManager within thirty (30) days from the date of such notice or that Borroweror Manager has failed to diligently undertake correcting such conditions withinsuch thirty (30) day period, Lender may direct Borrower to terminate theManagement Agreement and to replace Manager with a Qualified Manager on termsand conditions satisfactory to Lender, it being understood and agreed that themanagement fee for such replacement manager shall not exceed then prevailingmarket rates.

 

(d)                                 Borrower shall not, without the prior writtenconsent of Lender (which consent shall not be unreasonably withheld,conditioned or delayed): (i) surrender, terminate or cancel the ManagementAgreement or otherwise replace Manager or enter into any other managementagreement with respect to the Property; (ii) reduce or consent to the reductionof the term of the Management Agreement; (iii) increase or consent to theincrease of the amount of any charges under the Management Agreement; or (iv)otherwise modify, change, supplement, alter or amend, or waive or release anyof its rights and remedies under, the Management Agreement in any materialrespect. In the event that Borrower replaces Manager at any time during theterm of Loan pursuant to this subsection, such Manager shall be a QualifiedManager.

 

(c)                                  Notwithstanding the foregoing, Borrower shallbe permitted to transfer the management of the Property to an Affiliate ofManager provided that the terms of the management contract between Borrower andsuch entity provides for fees no greater than, is on terms that aresubstantially similar to and is no less favorable to Borrower than the ManagementAgreement in effect as of the date hereof.

 

**Section 5.15.****                        ****Liens**

 

Borrower shall not, without the prior written consent of Lender,create, incur, assume or suffer to exist any Lien on any portion of theProperty or permit any such action to be taken, except Permitted Encumbrances.

 

**Section 5.16.****                        ****Debt Cancellation**

 

Borrower shall not cancel or otherwise forgive or release any claim ordebt owed to Borrower by any Person, except for adequate consideration and inthe ordinary course of Borrower’s business.

 

**Section 5.17.****                        ****Zoing**

 

Borrower shall not initiate or consent to any zoning reclassificationof any portion of the Property or seek any variance under any existing zoningordinance or use or permit the use of any portion of the Property in any mannerthat could result in such use becoming a non-conforming use under any zoningordinance or any other applicable land use law, rule or regulation, without theprior written consent of Lender.

 

**Section 5.18.****                        ****ERISA**

 

(a)                                  Borrower shall not engage in any transactionwhich would cause any obligation, or action taken or to be taken, hereunder (orthe exercise by Lender of any of its rights under the

 

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Note,this Agreement or the other Loan Documents) to be a non-exempt (under astatutory or administrative class exemption) prohibited transaction underERISA.

 

(b)                                 Borrower further covenants and agrees todeliver to Lender such certifications or other evidence from time to timethroughout the term of the Loan, as requested by Lender in its sole discretion,that (i) Borrower is not and does not maintain an “employee benefit plan” asdefined in Section 3(3) of ERISA, which is subject to Title I of ERISA, ora “governmental plan” within the meaning of Section 3(3) of ERISA; (ii)Borrower is not subject to state statutes regulating investments and fiduciaryobligations with respect to governmental plans; and (iii) one or more of thefollowing circumstances is true:

 

(A)                             Equity interests in Borrower are publiclyoffered securities, within the meaning of 29 C.F.R. §2510.3-101(b)(2);

 

(B)                               Less than twenty-five percent (25%) of eachoutstanding class of equity interests in Borrower are held by “benefit planinvestors” within the meaning of 29 C.F.R. §2510.3-101(f)(2); or

 

(C)                               Borrower qualifies as an “operating company”or a “real estate operating company” within the meaning of 29 C.F.R. §25l0.3-101(c)or (e).

 

**Section 5.19.****                        ****No Joint Assessment**

 

Borrower shall not suffer, permit or initiate the joint assessment ofthe Property with (a) any other real property constituting a tax lot separatefrom the Property, or (b) any portion of the Property which may be deemed toconstitute personal property, or any other procedure whereby the Lien of anytaxes which may be levied against such personal property shall be assessed orlevied or charged to the Property.

 

**Section 5.20.****                        ****Reciprocal EasementAgreements**

 

Borrower shall not enter into, terminate or modify any REA withoutLender’s prior written consent, which consent shall not be unreasonably withheld,conditioned or delayed. Borrower shall enforce, comply with, and cause each ofthe parties to the REA to comply with all of the material economic terms andconditions contained in the REA, provided that Borrower may agree, withoutLender’s consent, to modifications to any REA or to grant casements withrespect to the Property which could not reasonably be expected to have amaterial adverse effect on the use, value or operation of the Property, on theability of American Express to perform its obligations under the AmericanExpress Lease or on Borrower’s ability to perform its obligations under theLoan Documents.

 

**ARTICLE 6**

**ENTITY COVENANTS**

 

**Section 6.1.****                               ****Single PurposeEntity/Separateness**

 

Until the Debt has been paid in full, Borrower represents, warrants andcovenants as follows:

 

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(a)                                  Borrower has not and will not:

 

(i)                                     engage in any business or activity other thanthe ownership, operation and maintenance of the Property, and activitiesincidental thereto;

 

(ii)                                  acquire or own any assets other than (A) theProperty, and (B) such incidental Personal Property as may be necessary for theoperation of the Property;

 

(iii)                               except as expressly provided in Article 7hereof, merge into or consolidate with any Person, or dissolve, terminate,liquidate in whole or in part, transfer or otherwise dispose of all orsubstantially all of its assets or change its legal structure;

 

(iv)                              fail to observe all organizationalformalities, or fail to preserve its existence as an entity duly organized,validly existing and in good standing (if applicable) under the applicableLegal Requirements of the jurisdiction of its organization or formation, oramend, modify, terminate or fail to comply with the provisions of its organizationaldocuments;

 

(v)                                 own any subsidiary, or make any investmentin, any Person;

 

(vi)                              commingle its assets with the assets of anyother Person, or permit any Affiliate or constituent party independent accessto its bank accounts;

 

(vii)                           incur any debt, secured or unsecured, director contingent (including guaranteeing any obligation), other than (A) the Debt,(B) trade and operational indebtedness incurred in the ordinary course ofbusiness with trade creditors, provided such indebtedness is (1) unsecured, (2)not evidenced by a note, (3) on commercially reasonable terms and conditions,and (4) due not more than sixty (60) days past the date incurred and paid on orprior to such date, and/or (C) financing leases and purchase money indebtednessincurred in the ordinary course of business relating to Personal Property oncommercially reasonable terms and conditions; provided however, the aggregateamount of the indebtedness described in (B) and (C) shall not exceed at anytime three percent (3%) of the outstanding principal amount of the Note;

 

(viii)                        permit its records, books of account, bankaccounts, financial statements and accounting records (including with respectto financial position, assets, liabilities, net worth and operating results) tobe shown on the financial statements of any holder of a beneficial interest inBorrower unless such financial statements shall contain a footnote indicatingthat Borrower is a separate legal entity and the assets of Borrower are notavailable as collateral to creditors of such holder;

 

(ix)                                enter into any contract or agreement with anygeneral partner, member, shareholder, principal, guarantor of the obligationsof Borrower, or any Affiliate of the foregoing, except upon terms andconditions that are intrinsically fair, commercially reasonable andsubstantially similar to those that would be available on an arm’s-length basiswith unaffiliated third parties;

 

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(x)                                   maintain its assets in such a manner that itwill be costly or difficult to segregate, ascertain or identify its individualassets from those of any other Person;

 

(xi)                                assume or guarantee the debts of any otherPerson, hold itself out to be responsible for the debts of any other Person, orotherwise pledge its assets for the benefit of any other Person or hold out itscredit as being available to satisfy the obligations of any other Person;

 

(xii)                             make any loans or advances to any Person;

 

(xiii)                          fail to file its own tax returns or files aconsolidated federal income tax return with any Person (unless prohibited orrequired, as the case may be, by applicable Legal Requirements);

 

(xiv)                         fail either to hold itself out to the publicas a legal entity separate and distinct from any other Person or to conduct itsbusiness solely in its own name or fail to correct any known misunderstandingregarding its separate identity;

 

(xv)                            fail to maintain adequate capital for thenormal obligations reasonably foreseeable in a business of its size andcharacter and in light of its contemplated business operations (provided thatBorrower’s failure to do so solely because of a shortfall in cash flow derivedfrom the operation of the Property shall not, by itself, constitute a breach ofthis covenant);

 

(xvi)                         Without the unanimous written consent of allof its members, as applicable, and the written consent of 100% of the managersof Borrower, including, without limitation, the Independent Director, (a) fileor consent to the filing of any petition, either voluntary or involuntary, totake advantage of any Creditors Rights Laws, (b) seek or consent to theappointment of a receiver, liquidator or any similar official, (c) take anyaction that might cause such entity to become insolvent, or (d) make anassignment for the benefit of creditors;

 

(xvii)                      fail to allocate shared expenses (including,without limitation, shared office space and services performed by an employeeof an Affiliate) among the Persons sharing such expenses and to use separatestationery, invoices and checks;

 

(xviii)                   fail to remain solvent or pay its ownliabilities (including, without limitation, salaries of its own employees) onlyfrom its own funds (provided that Borrower’s failure to do so solely because ofa shortfall in cash flow derived from the operation of the Property shall not,by itself, constitute a breach of this covenant);

 

(xix)                           acquire obligations or securities of itspartners, members, shareholders or other affiliates, as applicable;

 

(xx)                              violate or cause to be violated theassumptions made with respect to Borrower, Manager (if applicable) and theirrespective direct and/or indirect owners in any opinion letter pertaining tosubstantive consolidation delivered to Lender in connection with the Loan; or

 

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(xxi)                           fail to maintain a sufficient number ofemployees in light of its contemplated business operations.

 

(b)                                 The limited liability company agreement ofBorrower (the **“LLC Agreement”**) shallprovide that (i) upon the occurrence of any event that causes the sole memberof Borrower (**“Member”**) to cease to be themember of Borrower (other than (A) upon an assignment, by Member of all of itslimited liability company interest in Borrower and the admission of thetransferee in accordance with the Loan Documents and the LLC Agreement, or (B)the resignation of Member and the admission of an additional member of Borrowerin accordance with the terms of the Loan Documents and the LLC Agreement), anyperson acting as Independent Director of Borrower shall, without any action ofany other Person and simultaneously with the Member ceasing to be the member ofBorrower, automatically be admitted to Borrower (**“SpecialMember”**) and shall continue Borrower without dissolution and (ii)Special Member may not resign from Borrower or transfer its rights as SpecialMember unless (A) a successor Special Member has been admitted to Borrower asSpecial Member in accordance with requirements of Delaware law and (B) suchsuccessor Special Member has also accepted its appointment as an IndependentDirector. The LLC Agreement shall further provide that (i) Special Member shallautomatically cease to be a member of Borrower upon the admission to Borrowerof a substitute Member, (ii) Special Member shall be a member of Borrower thathas no interest in the profits, losses and capital of Borrower and has no rightto receive any distributions of Borrower assets, (iii) pursuant to Section 18-301of the Delaware Limited Liability Company Act (the **“Act”**),Special Member shall not be required to make any capital contributions toBorrower and shall not receive a limited liability company interest inBorrower, (iv) Special Member, in its capacity as Special Member, may not bindBorrower and (v) except as required by any mandatory provision of the Act,Special Member, in its capacity as Special Member, shall have no right to voteon, approve or otherwise consent to any action by, or matter relating to,Borrower, including, without limitation, the merger, consolidation orconversion of Borrower; provided, however, such prohibition shall not limit theobligations of Special Member, in its capacity as Independent Director, to voteon such matters required by the Loan Documents or the LLC Agreement. In orderto implement the admission to Borrower of Special Member, Special Member shallexecute a counterpart to the LLC Agreement. Prior to its admission to Borroweras Special Member, Special Member shall not be a member of Borrower.

 

Upon the occurrence of any event that causes the Member to cease to bea member of Borrower, to the fullest extent permitted by law, the personalrepresentative of Member shall, within ninety (90) days after the occurrence ofthe event that terminated the continued membership of Member in Borrower, agreein writing (i) to continue Borrower and (ii) to the admission of the personalrepresentative or its nominee or designee, as the case may be, as a substitutemember of Borrower, effective as of the occurrence of the event that terminatedthe continued membership of Member of Borrower in Borrower. Any actioninitiated by or brought against Member or Special Member under any CreditorsRights Laws shall not cause Member or Special Member to cease to be a member ofBorrower and upon the occurrence of such an event, the business of Borrowershall continue without dissolution. The LLC Agreement shall provide that eachof Member and Special Member waives any right it might have to agree in writingto dissolve Borrower upon the occurrence of any action initiated by or broughtagainst Member or Special Member under any Creditors Rights Laws, or theoccurrence of an event that causes Member or Special Member to cease to be amember of Borrower.

 

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**Section 6.2.****                               ****Change of Name, Identity orStructure**

 

Borrower shall not change or permit to be changed (a) Borrower’s name,(b) Borrower’s identity (including its trade name or names), (c) Borrower’sprincipal place of business set forth on the first page of this Agreement, (d)the corporate, partnership or other organizational structure of Borrower, orBorrower Principal, (e) Borrower’s state of organization, or (f) Borrower’sorganizational identification number, without in each case notifying Lender ofsuch change in writing at least thirty (30) days prior to the effective date ofsuch change and, in the case of a change in Borrower’s structure, without firstobtaining the prior written consent of Lender. In addition, Borrower shall notchange or permit to be changed any organizational documents of Borrower if suchchange would adversely impact the covenants set forth in Section 6.1 and Section 6.4hereof. Borrower authorizes Lender to file any financing statement or financingstatement amendment required by Lender to establish or maintain the validity, perfectionand priority of the security interest granted herein. At the request of Lender,Borrower shall execute a certificate in form satisfactory to Lender listing thetrade names under which Borrower intends to operate the Property, and representingand warranting that Borrower does business under no other trade name withrespect to the Property. If Borrower does not now have an organizationalidentification number and later obtains one, or if the organizational identificationnumber assigned to Borrower subsequently changes, Borrower shall promptly notifyLender of such organizational identification number or change. Nothing in this Section 6.2shall be deemed to restrict any express rights granted to Borrower under Article 7hereof.

 

**Section 6.3.****                               ****Business and Operations**

 

Borrower will qualify to do business and will remain in good standingunder the laws of the State as and to the extent the same are required for theownership, maintenance, management and operation of the Property.

 

**Section 6.4.****                               ****Independent Director**

 

(a)                                  The organizational documents of Borrowershall provide that at all times there shall be, and Borrower shall cause thereto be, at least one duly appointed member of the board of managers (each an **“Independent Director”**) of Borrower reasonably satisfactoryto Lender who is not at the time of such individual’s initial appointment, andshall not have been at any time during the preceding five (5) years, and shallnot be at any time while serving as a manager of Borrower, either (i) a shareholder(or other equity owner) of, or an officer, director, partner, manager, member(other than as a Special Member in the case of single member Delaware limitedliability companies), employee, attorney or counsel of, Borrower, BorrowerPrincipal or any of their respective shareholders, partners, members,subsidiaries or affiliates; (ii) a customer or creditor of, or supplier to,Borrower or any of its respective shareholders, partners, members, subsidiariesor affiliates who derives any of its purchases or revenue from its activitieswith Borrower or any Affiliate of any of them; (iii) a Person who Controls oris under common Control with any such shareholder, officer, director, partner,manager, member, employee, supplier, creditor or customer; or (iv) a member ofthe immediate family of any such shareholder, officer, director, partner,manager, member, employee, supplier, creditor or customer.

 

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(b)                                 The organizational documents of Borrowershall provide that the board of managers of Borrower shall not take any actionwhich, under the terms of any certificate of incorporation, by-laws or anyvoting trust agreement with respect to any common stock, requires an unanimousvote of the board of managers of Borrower unless at the time of such actionthere shall be at least one member of the board who is an Independent Director.Borrower will not, without the unanimous written consent of its board ofmanagers including the Independent Director, on behalf of Borrower, (i) file orconsent to the filing of any petition, either voluntary or involuntary, to takeadvantage of any applicable Creditors Rights Laws; (ii) seek or consent to theappointment of a receiver, liquidator or any similar official; (iii) take any actionthat might cause such entity to become insolvent; or (iv) make an assignmentfor the benefit of creditors.

 

**ARTICLE 7NO SALE OR ENCUMBRANCE**

 

**Section 7.1.****                               ****Transfer Definitions**

 

For purposes of this Article 7 an **“Affiliated Manager”**shall mean any managing agent in whichBorrower, Borrower Principal, or any affiliate of such entities has, directlyor indirectly, any legal, beneficial or economic interest; **“Control”**shall mean the power to directthe management and policies of a Restricted Party, directly or indirectly,whether through the ownership of voting securities or other beneficialinterests, by contract or otherwise; **“RestrictedParty”**shall mean Borrower, Borrower Principal, any AffiliatedManager, or any shareholder, partner, member or non-member manager, or anydirect or indirect legal or beneficial owner of Borrower, Borrower Principal,any Affiliated Manager or any non-member manager; and a **“Sale or Pledge”**shall mean a voluntary orinvoluntary sale, conveyance, mortgage, grant, bargain, encumbrance, pledge,assignment, grant of any options with respect to, or any other transfer ordisposition of (directly or indirectly, voluntarily or involuntarily, byoperation of law or otherwise, and whether or not for consideration or ofrecord) of a legal or beneficial interest.

 

**Section 7.2.****                               ****No Sale/Encumbrance**

 

(a)                                    Borrower shall not cause or permit a Sale orPledge of the Property or any part thereof or any legal or beneficial interesttherein nor permit a Sale or Pledge of an interest in any Restricted Party (ineach case, a **“Prohibited Transfer”**), other than pursuant to the AmericanExpress Lease, without the prior written consent of Lender.

 

(b)                                   A Prohibited Transfer shall include, but notbe limited to, (i) an installment sales agreement wherein Borrower agrees tosell the Property or any part thereof for a price to be paid in installments;(ii) an agreement by Borrower leasing all or a substantial part of the Propertyfor other than actual occupancy by a space tenant thereunder or a sale,assignment or other transfer of, or the grant of a security interest in,Borrower’s right, title and interest in and to any Leases or any Rents; (iii)if a Restricted Party is a corporation, any merger, consolidation or Sale orPledge of such corporation’s stock or the creation or issuance of new stock inone or a series of transactions, (iv) if a Restricted Party is a limited orgeneral partnership or joint venture, any merger or consolidation or thechange, removal, resignation or addition of a general partner or the Sale orPledge of the partnership interest of any general or limited partner or anyprofits or proceeds relating to such partnership interests or the creation orissuance of new partnership

 

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interests;(v) if a Restricted Party is a limited liability company, any merger orconsolidation or the change, removal, resignation or addition of a managingmember or non-member manager (or if no managing member, any member) or the Saleor Pledge of the membership interest of any member or any profits or proceedsrelating to such membership interest; (vi) if a Restricted Party is a trust ornominee trust, any merger, consolidation or the Sale or Pledge of the legal orbeneficial interest in a Restricted Party or the creation or issuance of newlegal or beneficial interests; or (vii) the removal or the resignation of theManager (including, without limitation, an Affiliated Manager) other than inaccordance with Section 5.14.

 

**Section 7.3.****                               ****Permitted Transfers**

 

Notwithstanding the provisions of Section 7.2, the followingtransfers shall not be deemed to be a Prohibited Transfer: (a) a transfer bydevise or descent or by operation of law upon the death of a member, partner orshareholder of a Restricted Party, so long as Borrower delivers notice toLender as soon as practicable thereafter and that such Restricted Party ispromptly reconstituted, if applicable, following the death of such member,partner or shareholder and there is no change in Control of such RestrictedParty as a result of such transfer; (b) the Sale or Pledge, in one or a seriesof related transactions, of not more than forty-nine percent (49%) of thestock, limited partnership interests or non-managing membership interests (asthe case may be) in a Restricted Party; provided, however, no such transfersshall result in a change in Control in the Restricted Party or change incontrol of the Property, and as a condition to each such transfer, Lender shallreceive not less than thirty (30) days prior written notice of such proposedtransfer. Notwithstanding the foregoing, any one or more of the transfers thatresults in any Person owning in excess of forty-nine percent (49%) of theownership interest in a Restricted Party shall comply with the requirements of Section 7.4.

 

**Section 7.4.****                               ****Lender’s Rights**

 

Lender reserves the right to condition the consent to a ProhibitedTransfer requested hereunder upon (a) a modification of the terms hereof and anassumption of the Note and the other Loan Documents as so modified by theproposed Prohibited Transfer, (b) receipt of payment of a transfer fee equal toone percent (1%) of the outstanding principal balance of the Loan and all ofLender’s expenses incurred in connection with such Prohibited Transfer, (c)receipt of written confirmation from the Rating Agencies that the ProhibitedTransfer will not result in a downgrade, withdrawal or qualification of theinitial, or if higher, then current ratings issued in connection with aSecuritization, or if a Securitization has not occurred, any ratings to beassigned in connection with a Securitization, (d) the proposed transferee’scontinued compliance with the covenants set forth in this Agreement (including,without limitation, the covenants in Article 6) and the other LoanDocuments, (e) a new manager for the Property and a new management agreementsatisfactory to Lender, and (f) the satisfaction of such other conditionsand/or legal opinions as Lender shall determine in its sole discretion to be inthe interest of Lender. All expenses incurred by Lender shall be payable byBorrower whether or not Lender consents to the Prohibited Transfer. Lendershall not be required to demonstrate any actual impairment of its security orany increased risk of default hereunder in order to declare the Debtimmediately due and payable upon a Prohibited Transfer made without Lender’sconsent. This provision shall apply to each and every Prohibited Transfer,whether or not Lender has consented to any previous Prohibited Transfer. In theevent an opinion letter pertaining to

 

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substantiveconsolidation was delivered to Lender and the Rating Agencies in connectionwith the closing of the Loan, and if any Sale or Pledge permitted under this Article 7results in any Person and its Affiliates owning in excess of forty-nine percent(49%) of the ownership interests in a Restricted Party, Borrower shall, priorto such transfer, and in addition to any other requirement for Lender consentcontained herein, deliver a revised substantive non-consolidation opinionletter to Lender reflecting such Prohibited Transfer, which opinion shall be inform, scope and substance acceptable in all respects to Lender and the RatingAgencies.

 

**Section 7.5.****                               ****Assumption**

 

Notwithstanding the foregoing provisions of this Article 7,following the date which is six (6) months from the Closing Date, Lender shallnot unreasonably withhold consent to a transfer of the Property in its entiretyto, and the related assumption of the Loan by, any Person (a **“Transferee”**) provided that each of the following terms andconditions are satisfied:

 

(a)                                no Default or Event of Default has occurred;

 

(b)                               Borrower shall have (i) delivered writtennotice to Lender of the terms of such prospective transfer not less thanforty-five (45) days before the date on which such transfer is scheduled toclose and, concurrently therewith, all such information concerning the proposedTransferee as Lender shall reasonably require and (ii) paid to Lender anon-refundable processing fee in the amount of $10,000. Lender shall have theright to approve or disapprove the proposed transfer based on its then currentunderwriting and credit requirements for similar loans secured by similarproperties which loans are sold in the secondary market, such approval not tobe unreasonably withheld. In determining whether to give or withhold itsapproval of the proposed transfer, Lender shall consider the experience andtrack record of Transferee and its principals in owning and operatingfacilities similar to the Property, the financial strength of Transferee andits principals, the general business standing of Transferee and its principalsand Transferee’s and its principals’ relationships and experience withcontractors, vendors, tenants, lenders and other business entities; provided,however, that, notwithstanding Lender’s agreement to consider the foregoingfactors in determining whether to give or withhold such approval, such approvalshall be given or withheld based on what Lender determines to be commercially reasonableand, if given, may be given subject to such conditions as Lender may deem reasonablyappropriate;

 

(c)                                Borrower shall have paid to Lender,concurrently with the closing of such transfer, (i) a non-refundable assumptionfee in an amount equal to one percent (1.0%) of the then outstanding principalbalance of the Note, and (ii) all out-of-pocket costs and expenses, includingreasonable attorneys’ fees, incurred by Lender in connection with the transfer;

 

(d)                               (i) Transferee shall have assumed and agreedto pay the Debt as and when due subject to the provisions of Article 15hereof and, prior to or concurrently with the closing of such transfer,Transferee and its constituent partners, members or shareholders as Lender may require,shall have executed, without any cost or expense to Lender, such documents and agreementsas Lender shall reasonably require to evidence and effectuate said assumptionand (ii) if required by Lender, a Person affiliated with Transferee and acceptableto Lender shall have

 

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assumedthe obligations of Borrower Principal under the Loan Documents with respect toall acts and events occurring or arising after the transfer of the Propertypursuant to this Section 7.5;

 

(e)                                Borrower and Transferee, without any cost toLender, shall furnish any information requested by Lender for the preparationof, and shall authorize Lender to file, new financing statements and financingstatement amendments and other documents to the fullest extent permitted byapplicable law, and shall execute any additional documents reasonably requestedby Lender;

 

(f)                                  Borrower shall have delivered to Lender,without any cost or expense to Lender, such endorsements to Lender’s TitleInsurance Policy insuring that fee simple or leasehold title to the Property,as applicable, is vested in Transferee (subject to Permitted Encumbrances), hazardinsurance endorsements or certificates and other similar materials as Lendermay deem necessary at the time of the transfer, all in form and substancesatisfactory to Lender;

 

(g)                               Transferee shall have furnished to Lender, ifTransferee is a corporation, partnership, limited liability company or otherentity, all appropriate papers evidencing Transferee’s organization and goodstanding, and the qualification of the signers to execute the assumption of theDebt, which papers shall include certified copies of all documents relating to theorganization and formation of Transferee and of the entities, if any, which arepartners or members of Transferee. Transferee and such constituent partners,members or shareholders of Transferee (as the case may be), as Lender shallrequire, shall comply with the covenants set forth in Article 6 hereof;

 

(h)                               Transferee shall assume the obligations ofBorrower under any Management Agreement or provide a new management agreementwith a new manager which meets with the requirements of Section 5.14hereof and assign to Lender as additional security such new management agreement;

 

(i)                                   Transferee shall furnish an opinion ofcounsel satisfactory to Lender and its counsel (A) that Transferee’s formationdocuments provide for the matters described in subparagraph (g) above, (B) thatthe assumption of the Debt has been duly authorized, executed and delivered,and that the Note, the Mortgage, this Agreement, the assumption agreement andthe other Loan Documents are valid, binding and enforceable against Transfereein accordance with their terms, (C) that Transferee and any entity which is acontrolling stockholder, member or general partner of Transferee, have beenduly organized, and are in existence and good standing, and (E) with respect tosuch other matters as Lender may reasonably request;

 

(j)                                   if required by Lender, Lender shall havereceived confirmation in writing from the Rating Agencies that rate theSecurities to the effect that the transfer will not result in a qualification,downgrade or withdrawal of any rating initially assigned or to be assigned tothe Securities;

 

(k)                                Borrower’s obligations under the contract ofsale pursuant to which the transfer is proposed to occur shall expressly besubject to the satisfaction of the terms and conditions of this Section 7.5;and

 

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(l)                                   Transferee shall, prior to such transfer,deliver a substantive non-consolidation opinion to Lender, which opinion shallbe in form, scope and substance acceptable in all respects to Lender and theRating Agencies.

 

Aconsent by Lender with respect to a transfer of the Property in its entiretyto, and the related assumption of the Loan by, a Transferee pursuant to this Section 7.5shall not be construed to be a waiver of the right of Lender to consent to anysubsequent Sale or Pledge of the Property. Upon the transfer of the Propertypursuant to this Section 7.5, Borrower and Borrower Principal shall berelieved of all liability under the Loan Documents for acts, events,conditions, or circumstances occurring or arising after the date of such transfer,except to the extent that such acts, events, conditions, or circumstances arethe proximate result of acts, events, conditions, or circumstances that existedprior to the date of such transfer, whether or not discovered prior orsubsequent to the date of such transfer.

 

**Section 7.6.****                               ****Assumption by InlandPermitted Transferee**

 

Notwithstanding the foregoing provisions of this Article 7,Borrower shall be permitted to transfer the Property in its entirety to,provided the Loan is simultaneously assumed by, an Inland Permitted Transferee,and provided further that each of the following terms and conditions issatisfied:

 

(a)                                    no Default or Event of Default has occurred;

 

(b)                                   Borrower shall have delivered written noticeto Lender of the terms of such prospective transfer not less than forty-five(45) days before the date on which such transfer is scheduled to close and,concurrently therewith, all such information concerning the proposed Transfereeas Lender shall reasonably require;

 

(c)                                    Borrower shall have paid to Lender allout-of-pocket costs and expenses, including reasonable attorneys’ fees,incurred by Lender in connection with the transfer;

 

(d)                                   such Inland Permitted Transferee assumes andagrees to pay the Debt as and when due subject to the provisions of Article 15hereof and, prior to or concurrently with the closing of such transfer, suchInland Permitted Transferee and its constituent partners, members or shareholdersas Lender may require, shall execute, without any cost or expense to Lender,such documents and agreements as Lender shall reasonably require to evidenceand effectuate said assumption;

 

(e)                                    Borrower and such Inland PermittedTransferee, without any cost to Lender, shall furnish any information requestedby Lender for the preparation of, and shall authorize Lender to file, newfinancing statements and financing statement amendments and other documents tothe fullest extent permitted by applicable law, and shall execute anyadditional documents reasonably requested by Lender;

 

(f)                                      Borrower shall have delivered to Lender,without any cost or expense to Lender, endorsements to Lender’s Title InsurancePolicy insuring that fee simple title to the Property is vested in such InlandPermitted Transferee (subject to Permitted Encumbrances), hazard

 

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insuranceendorsements or certificates and other similar materials as Lender may deemnecessary at the time of the transfer, all in form and substance satisfactoryto Lender;

 

(g)                                 such Inland Permitted Transferee shall havefurnished to Lender, if such Inland Permitted Transferee is a corporation,partnership, limited liability company or other entity, all appropriate papersevidencing Transferee’s organization and good standing, and the qualificationof the signers to execute the assumption of the Debt, which papers shallinclude certified copies of all documents relating to the organization andformation of Transferee and of the entities, if any, which are partners ormembers of Transferee. Transferee and such constituent partners, members orshareholders of Transferee (as the case may be), as Lender shall require, shallcomply with the covenants set forth in Article 6 hereof, provided,however, that, (i) if such Inland Permitted Transferee is a limited partnershipor a limited liability company (with more than one member), Lender may requirethat the general partner or managing member of such Inland Permitted Transfereealso comply with the covenants set forth in Article 6, as modified tostate that such general partner or managing member holds an interest in theInland Permitted Transferee rather than an interest in the Property or (ii) ifsuch Inland Permitted Transferee is a single member limited liability company,the state of organization of such entity must be Delaware and theorganizational documents must provide for a springing member upon thebankruptcy or dissolution of the sole member;

 

(h)                                 such Inland Permitted Transferee shall assumethe obligations of Borrower under any Management Agreement or provide a newmanagement agreement with a new manager which meets with the requirements of Section 5.14hereof and assign to Lender as additional security such new managementagreement;

 

(i)                                     Transferee shall furnish an opinion ofcounsel satisfactory to Lender and its counsel (A) that Transferee’s formationdocuments provide for the matters described in subparagraph (g) above, (B) thatthe assumption of the Debt has been duly authorized, executed and delivered,and that the Note, the Mortgage, this Agreement, the assumption agreement andthe other Loan Documents are valid, binding and enforceable against Transfereein accordance with their terms, (C) that Transferee and any entity which is acontrolling stockholder, member or general partner of Transferee, have beenduly organized, and are in existence and good standing, and (E) with respect tosuch other matters as Lender may reasonably request, including, withoutlimitation, customary single member limited liability company opinions in theevent that such Inland Permitted Transferee is a Delaware limited liabilitycompany; and

 

(j)                                     in the event a substantive non-consolidationopinion was required in connection with the closing of the Loan, Transfereeshall, prior to such transfer, deliver a substantive non-consolidation opinionto Lender, which opinion shall be in form, scope and substance acceptable inall respects to Lender and the Rating Agencies.

 

Aconsent by Lender with respect to a transfer of the Property in its entiretyto, and the related assumption of the Loan by, a Transferee pursuant to this Section 7.6 shall not be construed to be awaiver of the right of Lender to consent to any subsequent Sale or Pledge ofthe Property.

 

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**ARTICLE 8**

**INSURANCE; CASUALTY; CONDEMNATION;RESTORATION**

 

**Section 8.1.****                               ****Insurance**

 

(a)                                  Subject to the provisions of paragraph (g) ofthis Section 8.1, Borrower shall obtain and maintain, or cause AmericanExpress to maintain, insurance for Borrower and the Property providing at leastthe following coverages:

 

(i)                                     comprehensive “special causes of loss” formof insurance (or its equivalent) on the Improvements and the Personal Property(A) in an amount equal to not less than one hundred percent (100%) of the “FullReplacement Cost,” which for purposes of this Agreement shall mean actualreplacement value (exclusive of costs of excavations, foundations, undergroundutilities and footings) with a waiver of depreciation; (B) written on areplacement cost basis and containing either an agreed amount endorsement withrespect to the Improvements and Personal Property or a waiver of all co-insurance provisions; (C) providing for nodeductible in excess of $10,000 for all such insurance coverage; (D) at alltimes insuring against at least those hazards that are commonly insured againstunder a “special causes of loss” form of policy, as the same shall exist on thedate hereof, and together with any increase in the scope of coverage providedunder such form after the date hereof; and (E) if any of the Improvements orthe use of the Property shall at any time constitute legal non-conformingstructures or uses, providing coverage for contingent liability from Operationof Building Laws, Demolition Costs and Increased Cost of Construction Endorsementsand containing an “Ordinance or Law Coverage” or “Enforcement” endorsement. Inaddition, Borrower shall obtain: (y) if any portion of the Improvements iscurrently or at any time in the future located in a “special flood hazard area”designated by the Federal Emergency Management Agency, flood hazard insurancein an amount equal to the maximum amount of such insurance available under theNational Flood Insurance Act of 1968, the Flood Disaster Protection Act of 1973or the National Flood Insurance Reform Act of 1994, as each may be amended; and(z) earthquake insurance in amounts and in form and substance reasonably satisfactoryto Lender in the event the Property is located in an area with a high degree ofseismic risk, provided that the insurance pursuant to clauses (y) and (z)hereof shall be on terms consistent with the special causes of loss formrequired under this subsection (i);

 

(ii)                                  commercial general liability insuranceagainst claims for personal injury, bodily injury, death or property damageoccurring upon, in or about the Property, with such insurance (A) to be on theso-called “occurrence” form with a general aggregate limit of not less than$2,000,000 and a per occurrence limit of not less than $1,000,000; (B) tocontinue at not less than the aforesaid limit until required to be changed byLender in writing by reason of changed economic conditions making suchprotection inadequate; and (C) to cover at least the following hazards: (1)premises and operations; (2) products and completed operations; (3) independentcontractors; (4) blanket contractual liability; and (5) contractual liabilitycovering the indemnities contained in Article 12 and Article 14hereof to the extent the same is available;

 

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(iii)                               if the rating of American Express issued bythe Rating Agencies falls below the Trigger Rating, loss of rents insurance orbusiness income insurance, as applicable, (A) with loss payable to Lender; (B)covering all risks required to be covered by the insurance provided for in subsection (i)above; and (C) which provides that after the physical loss to the Improvementsand Personal Property occurs, the loss of rents or income, as applicable, willbe insured until such rents or income, as applicable, either returns to thesame level that existed prior to the loss or the expiration of twelve (12)months, whichever first occurs, and notwithstanding that the policy may expireprior to the end of such period; and (D) which contains an extended period ofindemnity endorsement which provides that after the physical loss to theImprovements and Personal Property has been repaired, the continued loss ofincome will be insured until such income either returns to the same level itwas at prior to the loss, or the expiration of twelve (12) months from the datethat the Property is repaired or replaced and operations are resumed, whicheverfirst occurs, and notwithstanding that the policy may expire prior to the endof such period. The amount of such loss of rents or business income insurance,as applicable, shall be determined prior to the date hereof and at least onceeach year thereafter based on Borrower’s reasonable estimate of the grossincome from the Property for the succeeding period of coverage required above.All proceeds payable to Lender pursuant to this subsection shall be heldby Lender and shall be applied to the obligations secured by the Loan Documentsfrom time to time due and payable hereunder and under the Note; provided,however, that nothing herein contained shall be deemed to relieve Borrower ofits obligations to pay the obligations secured by the Loan Documents on therespective dates of payment provided for in the Note, this Agreement and theother Loan Documents except to the extent such amounts are actually paid out ofthe proceeds of such loss of rents or business income insurance, as applicable;

 

(iv)                              at all times during which structuralconstruction, repairs or alterations are being made with respect to theImprovements, and only if the Property coverage form does not otherwise apply,(A) owner’s contingent or protective liability insurance covering claims notcovered by or under the terms or provisions of the above mentioned commercialgeneral liability insurance policy; and (B) the insurance provided for in subsection (i)above written in a so-called Builder’s Risk Completed Value form (1) on anon-reporting basis, (2) against “special causes of loss” insured againstpursuant to subsection (i) above, (3) including permission to occupy theProperty, and (4) with an agreed amount endorsement waiving co-insuranceprovisions;

 

(v)                                 workers’ compensation, subject to thestatutory limits of the State, and employer’s liability insurance in respect ofany work or operations on or about the Property, or in connection with theProperty or its operation (if applicable);

 

(vi)                              comprehensive boiler and machinery insurance,if applicable, in amounts as shall be reasonably required by Lender on termsconsistent with the commercial property insurance policy required under subsection (i)above;

 

(vii)                           excess liability insurance in an amount notless than $75,000,000 per occurrence on terms consistent with the commercialgeneral liability insurance required under subsection (ii) above; and

 

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(viii)                        upon sixty (60) days’ written notice, suchother reasonable insurance and in such reasonable amounts as Lender from timeto time may reasonably request against such other insurable hazards which atthe time are commonly insured against for property similar to the Propertylocated in or around the region in which the Property is located.

 

With respect to the policies required to be maintained pursuant toclauses (i) through (viii) above, Borrower shall use commercially reasonableefforts, consistent with those of prudent owners of institutional quality commercial real estate, to maintaininsurance against Losses resulting from acts of terrorism.

 

(b)                                  All insurance provided for in Section 8.1(a) shall be obtained under valid and enforceable policies (collectively, the **“Policies”** or in the singular, the **“Policy”**),and shall be subject to the approval of Lender as to insurance companies,amounts, deductibles, loss payees and insureds. The Policies shall be issued byfinancially sound and responsible insurance companies authorized to do businessin the State and having a claims paying ability rating of “A-” or better byS&P (or such other ratings approved by Lender) and/or a general policyrating of “A” or better and a financial class of VIII or better by A.M. BestCompany, Inc. The Policies described in Section 8.1 (a) shall designateLender and its successors and assigns as additional insureds, mortgagees and/orloss payee as deemed appropriate by Lender. To the extent such Policies are notavailable as of the Closing Date, Borrower shall deliver to Lender prior to theClosing Date an Acord 28 or similar certificate of insurance evidencing thecoverages and amounts required hereunder and, upon request of Lender as soon asavailable after the Closing Date, certified copies of all Policies. Not lessthan ten (10) days prior to the expiration dates of any insurance coverage inplace with respect to the Property, Borrower shall deliver to Lender an Acord28 or similar certificate, accompanied by evidence satisfactory to Lender ofpayment of the premiums due in connection therewith (the **“InsurancePremiums”**), and, as soon as available thereafter, certified copiesof all renewal Policies.

 

(c)                                   Any blanket insurance Policy shallspecifically allocate to the Property the amount of coverage from time to timerequired hereunder and shall otherwise provide the same protection as would aseparate Policy insuring only the Property in compliance with the provisions ofSection 8.1(a).

 

(d)                                  All Policies provided for or contemplated by Section 8.1(a), except for the Policy referenced in Section 8.1(a)(v), shall nameBorrower as the insured and Lender as the additional insured, as its interestsmay appear, and in the case of property damage, boiler and machinery, flood andearthquake insurance, shall contain a so-called New York standardnon-contributing mortgagee clause in favor of Lender providing that the lossthereunder shall be payable to Lender.

 

(e)                                   All Policies provided for in Section 8.1(a)shall contain clauses or endorsements to the effect that:

 

(i)                                     no act or negligence of Borrower, or anyoneacting for Borrower, or of any Tenant or other occupant, or failure to complywith the provisions of any Policy, which might otherwise result in a forfeitureof the insurance or any part thereof, shall in

 

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any way affect the validity or enforceability of the insurance insofaras Lender is concerned;

 

(ii)                                  the Policies shall not be materially changed(other than to increase the coverage provided thereby) or canceled by theinsurer without at least thirty (30) days’ (ten (10) days’ in the case ofnon-payment of premium) prior written notice to Lender and any other partynamed therein as an additional insured;

 

(iii)                               the issuers thereof shall give written noticeto Lender if the Policies have not been renewed thirty (30) days prior to itsexpiration; and

 

(iv)                              Lender shall not be liable for any InsurancePremiums thereon or subject to any assessments thereunder.

 

(f)                                   If at any time Lender is not in receipt ofwritten evidence that all insurance required hereunder is in full force andeffect, Lender shall have the right, without notice to Borrower, to take suchaction as Lender deems necessary to protect its interest in the Property, including,without limitation, obtaining such insurance coverage as Lender in its solediscretion deems appropriate. All premiums incurred by Lender in connectionwith such action or in obtaining such insurance and keeping it in effect shallbe paid by Borrower to Lender upon demand and, until paid, shall be secured bythe Mortgage and shall bear interest at the Default Rate.

 

(g)                                Notwithstanding any other provision hereof tothe contrary, Lender acknowledges that so long as no American Express LeaseDefault has occurred, Borrower shall not be required to obtain the insurancecoverages set forth in paragraphs (a)(i) through (viii) if (x) Guarantor (or AmericanExpress if there is no Guarantor) is a self-insurer and maintains a ratingissued by the Rating Agencies of not less than the Trigger Rating or (y)American Express maintains insurance with coverages and carriers in compliancewith the terms of the American Express Lease.

 

**Section 8.2.****                               ****Casualty**

 

If the Property shall be damaged or destroyed, in whole or in part, byfire or other casualty (a **“Casualty”**),Borrower shall give prompt notice of such damage to Lender and shall promptlycommence and diligently prosecute the Restoration of the Property in accordancewith Section 8.4, whether or not Lender makes any Net Proceeds availablepursuant to Section 8.4. Borrower shall pay all costs of such Restorationwhether or not such costs are covered by insurance. Lender may, but shall notbe obligated to make proof of loss if not made promptly by Borrower. Borrowershall adjust all claims for Insurance Proceeds in consultation with, andapproval of, Lender; provided, however, if an Event of Default has occurred andis continuing, Lender shall have the exclusive right to participate in theadjustment of all claims for Insurance Proceeds.

 

**Section 8.3.****                               ****Condemnation**

 

Borrower shall promptly give Lender notice of the actual or threatenedcommencement of any proceeding for the Condemnation of the Property of whichBorrower has knowledge and shall deliver to Lender copies of any and all papersserved in connection with such proceedings.

 

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Lendermay participate in any such proceedings, and Borrower shall from time to timedeliver to Lender all instruments requested by it to permit such participation.Borrower shall, at its expense, diligently prosecute any such proceedings, andshall consult with Lender, its attorneys and experts, and cooperate with themin the carrying on or defense of any such proceedings. Notwithstanding anytaking by any public or quasi-public authority through Condemnation orotherwise (including but not limited to any transfer made in lieu of or inanticipation of the exercise of such taking), Borrower shall continue to paythe Debt at the time and in the manner provided for its payment in the Note andin this Agreement and the Debt shall not be reduced until any Award shall havebeen actually received and applied by Lender, after the deduction of expensesof collection, to the reduction or discharge of the Debt. Lender shall not belimited to the interest paid on the Award by the condemning authority but shallbe entitled to receive out of the Award interest at the rate or rates providedherein or in the Note. If the Property or any portion thereof is taken by acondemning authority, Borrower shall promptly commence and diligently prosecutethe Restoration of the Property and otherwise comply with the provisions of Section 8.4,whether or not Lender makes any Net Proceeds available pursuant to Section 8.4.If the Property is sold, through foreclosure or otherwise, prior to the receiptby Lender of the Award, Lender shall have the right, whether or not adeficiency judgment on the Note shall have been sought, recovered or denied, toreceive the Award, or a portion thereof sufficient to pay the Debt. So long asno American Express Lease Default has occurred, the payment and allocation ofany Awards shall be governed by the American Express Lease.

 

**Section 8.4.****                               ****Restoration**

 

The following provisions shall apply in connection with the Restorationof the Property:

 

(a)                                 If the Net Proceeds shall be less than$50,000 and the costs of completing the Restoration shall be less than $50,000,the Net Proceeds will be disbursed by Lender to Borrower upon receipt, providedthat all of the conditions set forth in Section 8.4(b)(i) are met and Borrowerdelivers to Lender a written undertaking to expeditiously commence and to satisfactorilycomplete with due diligence the Restoration in accordance with the terms ofthis Agreement.

 

(b)                                If the Net Proceeds are equal to or greaterthan $50,000 or the costs of completing the Restoration are equal to or greaterthan $50,000, Lender shall make the Net Proceeds available for the Restorationin accordance with the provisions of this Section 8.4. The term **“Net****Proceeds”**for purposes of this Section 8.4 shall mean: (i) the net amountof all insurance proceeds received by Lender pursuant to Section 8.1(a)(i),(iv), (vi) and (viii) as a result of a Casualty, after deduction of itsreasonable costs and expenses (including, but not limited to, reasonablecounsel fees), if any, in collecting the same (**“InsuranceProceeds”**), or (ii) the net amount of the Award as a result of aCondemnation, after deduction of its reasonable costs and expenses (including,but not limited to, reasonable counsel fees), if any, in collecting the same (**“Condemnation Proceeds”**),whichever the case may be.

 

(i)                                     The Net Proceeds shall be made available toBorrower for Restoration provided that each of the following conditions aremet:

 

(A)                              no Event of Default shall have occurred andbe continuing;

 

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(B)                                (1) in the event the Net Proceeds areInsurance Proceeds, less than thirty percent (30%) of the total floor area ofthe Improvements on the Property has been damaged, destroyed or renderedunusable as a result of a Casualty, or (2) in the event the Net Proceeds areCondemnation Proceeds, less than ten percent (10%) of the land constituting theProperty is taken, such land is located along the perimeter or periphery of theProperty, and no portion of the Improvements is located on such land;

 

(C)                                The American Express Lease shall remain infull force and effect during and after completion of the Restoration withoutabatement of Rent;

 

(D)                               Borrower shall commence the Restoration assoon as reasonably practicable (but in no event later than sixty (60) daysafter such Casualty or Condemnation, whichever the case may be, occurs) andshall diligently pursue the same to satisfactory completion;

 

(E)                                 Lender shall be satisfied that any operatingdeficits, including all scheduled payments under the Note, which will beincurred with respect to the Property as a result of the occurrence of any suchCasualty or Condemnation, whichever the case may be, will be covered out of theinsurance coverage referred to in Section 8.1(a)(iii) above;

 

(F)                                 Lender shall be satisfied that theRestoration will be completed on or before the earliest to occur of (1) six (6)months prior to the Maturity Date, (2) the earliest date required for suchcompletion under the terms of any Leases or material agreements affecting theProperty, (3) such time as may be required under applicable zoning law,ordinance, rule or regulation, or (4) the expiration of the insurance coveragereferred to in Section 8. l(a)(iii);

 

(G)                                the Property and the use thereof after theRestoration will be in compliance with and permitted under all LegalRequirements;

 

(H)                               the Restoration shall be done and completed by Borrower in anexpeditious and diligent fashion and in compliance with all applicable LegalRequirements;

 

(I)                                    such Casualty or Condemnation, as applicable,does not result in the loss of access to the Property or the Improvements;

 

(J)                                   Borrower shall deliver, or cause to bedelivered, to Lender a signed detailed budget approved in writing by Borrower’sarchitect or engineer stating the entire cost of completing the Restoration,which budget shall be acceptable to Lender; and

 

(K)                               the Net Proceeds together with any cash or cash equivalent deposited byBorrower with Lender are sufficient in Lender’s reasonable judgment to coverthe cost of the Restoration.

 

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(ii)                                  The Net Proceeds shall be held by Lenderuntil disbursements commence, and, until disbursed in accordance with theprovisions of this Section 8.4, shall constitute additional security forthe Debt and other obligations under the Loan Documents. The Net Proceeds shallbe disbursed by Lender to, or as directed by, Borrower from time to time duringthe course of the Restoration, upon receipt of evidence satisfactory to Lenderthat (A) all the conditions precedent to such advance, including those setforth in Section 8.4(b)(i), have been satisfied, (B) all materialsinstalled and work and labor performed (except to the extent that they are tobe paid for out of the requested disbursement) in connection with the relatedRestoration item have been paid for in full, and (C) there exist no notices ofpendency, stop orders, mechanic’s or materialman’s liens or notices ofintention to file same, or any other liens or encumbrances of any naturewhatsoever on the Property which have not either been fully bonded to thesatisfaction of Lender and discharged of record or in the alternative fullyinsured to the satisfaction of Lender by the title company issuing the TitleInsurance Policy. Notwithstanding the foregoing, Business Interruption Proceedsrequired to be maintained by Borrower pursuant to section 8.1(a)(iii)shall be controlled by Lender at all times, shall not be subject to theprovisions of this Section 8.4 and shall be used solely for the payment ofthe obligations under the Loan Documents and Operating Expenses.

 

(iii)                               All plans and specifications required inconnection with the Restoration shall be subject to prior review and acceptancein all respects by Lender and by an independent consulting engineer selected byLender (the **“Restoration Consultant”**). Lender shall have the use of theplans and specifications and all permits, licenses and approvals required orobtained in connection with the Restoration. The identity of the contractors,subcontractors and materialmen engaged in the Restoration, as well as thecontracts in excess of $50,000 under which they have been engaged, shall besubject to prior review and acceptance by Lender and the RestorationConsultant. All costs and expenses incurred by Lender in connection with makingthe Net Proceeds available for the Restoration, including, without limitation,reasonable counsel fees and disbursements and the Restoration Consultant’sfees, shall be paid by Borrower.

 

(iv)                              In no event shall Lender be obligated to makedisbursements of the Net Proceeds in excess of an amount equal to the costsactually incurred from time to time for work in place as part of theRestoration, as certified by the Restoration Consultant, minus the RestorationRetainage. The term **“Restoration Retainage”**shallmean an amount equal to ten percent (10%) of the costs actually incurred forwork in place as part of the Restoration, as certified by the RestorationConsultant, until the Restoration has been completed. The Restoration Retainageshall be reduced to five percent (5%) of the costs incurred upon receipt byLender of satisfactory evidence that fifty percent (50%) of the Restoration hasbeen completed. The Restoration Retainage shall in no event, andnotwithstanding anything to the contrary set forth above in this Section 8.4(b),be less than the amount actually held back by Borrower from contractors,subcontractors and materialmen engaged in the Restoration. The RestorationRetainage shall not be released until the Restoration Consultant certifies toLender that the Restoration has been completed in accordance with the provisionsof this Section 8.4(b) and that all approvals necessary for there-occupancy and use of the Property have been obtained from all appropriateGovernmental Authorities, and Lender receives evidence satisfactory to

 

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Lender that the costs of the Restoration have been paid in full or willbe paid in full out of the Restoration Retainage; provided, however, thatLender will release the portion of the Restoration Retainage being held withrespect to any contractor, subcontractor or materialman engaged in theRestoration as of the date upon which the Restoration Consultant certifies toLender that the contractor, subcontractor or materialman has satisfactorilycompleted all work and has supplied all materials in accordance with theprovisions of the contractor’s, subcontractor’s or materialman’s contract, thecontractor, subcontractor or materialman delivers the lien waivers and evidenceof payment in full of all sums due to the contractor, subcontractor ormaterialman as may be reasonably requested by Lender or by the title companyissuing the Title Insurance Policy, and Lender receives an endorsement to theTitle Insurance Policy insuring the continued priority of the lien of theMortgage and evidence of payment of any premium payable for such endorsement.If required by Lender, the release of any such portion of the RestorationRetainage shall be approved by the surety company, if any, which has issued apayment or performance bond with respect to the contractor, subcontractor ormaterialman.

 

(v)                                 Lender shall not be obligated to makedisbursements of the Net Proceeds more frequently than once every calendarmonth.

 

(vi)                              If at any time the Net Proceeds or theundisbursed balance thereof shall not, in the reasonable opinion of Lender inconsultation with the Restoration Consultant, be sufficient to pay in full thebalance of the costs which are estimated by the Restoration Consultant to beincurred in connection with the completion of the Restoration, Borrower shalldeposit the deficiency (the **“Net Proceeds Deficiency”**)with Lender before any further disbursement of the Net Proceeds shall be made.The Net Proceeds Deficiency deposited with Lender shall be held by Lender andshall be disbursed for costs actually incurred in connection with theRestoration on the same conditions applicable to the disbursement of the NetProceeds, and until so disbursed pursuant to this Section 8.4(b) shallconstitute additional security for the Debt and other obligations under theLoan Documents.

 

(vii)                           The excess, if any, of the Net Proceeds andthe remaining balance, if any, of the Net Proceeds Deficiency deposited withLender after the Restoration Consultant certifies to Lender that theRestoration has been completed in accordance with the provisions of this Section 8.4(b),and the receipt by Lender of evidence satisfactory to Lender that all costsincurred in connection with the Restoration have been paid in full, shall beremitted by Lender to Borrower, provided no Event of Default shall haveoccurred and shall be continuing under the Note, this Agreement or any of theother Loan Documents.

 

(c)                                  All Net Proceeds not required (i) to be madeavailable for the Restoration or (ii) to be returned to Borrower as excess NetProceeds pursuant to Section 8.4(b)(vii) may (x) be retained and appliedby Lender toward the payment of the Debt whether or not then due and payable insuch order, priority and proportions as Lender in its sole discretion shalldeem proper, or, (y) at the sole discretion of Lender, the same may be paid,either in whole or in part, to Borrower for such purposes and upon such conditionsas Lender shall designate.

 

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(d)                               In the event of foreclosure of the Mortgage,or other transfer of title the Property in extinguishment in whole or in partof the Debt, all right, title and interest of Borrower in and to the Policiesthen in force concerning the Property and all proceeds payable thereunder shallthereupon vest in the purchaser at such foreclosure, Lender or other transfereein the event of such other transfer of title.

 

(e)                                Notwithstanding the foregoing, so long as noAmerican Express Lease Default has occurred, the Net Proceeds shall be used forrestoration of the Property in accordance with the provisions of the AmericanExpress Lease.

 

**ARTICLE 9REPLACEMENTS; RESERVE****FUNDS**

 

**Section 9.1.****                               ****Replacements**

 

On an ongoing basis throughout the term of the Loan, Borrower shallmake capital repairs, replacements and improvements necessary to keep theProperty in good order and repair and in a good marketable condition or preventdeterioration of the Property. So long as no American Express Lease Defaultshall have occurred, the compliance by American Express with its obligations formaintenance of the Property as set forth in the American Express Lease shall bedeemed compliance by Borrower with the provisions of this Section 9.1.

 

**Section 9.2.****                               ****Tax and Insurance ReserveFunds**

 

If required by Lender following a default by American Express under theAmerican Express Lease Borrower shall establish an Eligible Account with Lenderor Lender’s agent sufficient to discharge Borrower’s obligations for thepayment of Taxes and Insurance Premiums pursuant to Section 5.4 and Section 8.1hereof (the **“Tax and Insurance ReserveAccount”)**Borrower shall deposit into the Tax and Insurance ReserveAccount on each Scheduled Payment Date (a) one-twelfth of the Taxes that Lenderestimates will be payable during the next ensuing twelve (12) months or suchhigher amount necessary to accumulate with Lender sufficient funds to pay allsuch Taxes at least thirty (30) days prior to the earlier of (i) the date thatthe same will become delinquent and (ii) the date that additional charges orinterest will accrue due to the non-payment thereof, and (b) except to theextent Lender has waived the insurance escrow because the insurance requiredhereunder is maintained under a blanket insurance Policy acceptable to Lenderin accordance with Section 8.l(c), one-twelfth of the Insurance Premiumsthat Lender estimates will be payable during the next ensuing twelve (12)months for the renewal of the coverage afforded by the Policies upon theexpiration thereof or such higher amount necessary to accumulate with Lender sufficientfunds to pay all such Insurance Premiums at least thirty (30) days prior to theexpiration of the Policies (said amounts in (a) and (b) above hereinaftercalled the **“Tax and Insurance Reserve Funds”**). Lender will apply the Tax andInsurance Reserve Funds to payments of Taxes and Insurance Premiums required tobe made by Borrower pursuant to Section 5.4 and Section 8.1 hereof.In making any disbursement from the Tax and Insurance Reserve Account, Lendermay do so according to any bill, statement or estimate procured from theappropriate public office or tax lien service (with respect to Taxes) orinsurer or agent (with respect to Insurance Premiums), without inquiry into theaccuracy of such bill, statement or estimate or into the validity of any tax, assessment,sale, forfeiture, tax lien or title or claim

 

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thereof.If the amount of the Tax and Insurance Reserve Funds shall exceed the amountsdue for Taxes and Insurance Premiums pursuant to Section 5.4 and Section 8.1hereof, Lender shall, in its sole discretion, return any excess to Borrower orcredit such excess against future payments to be made to the Tax and InsuranceReserve Account. In allocating any such excess, Lender may deal with the personshown on Lender’s records as being the owner of the Property. Any amountremaining in the Tax and Insurance Reserve Account after the Debt has been paidin full shall be returned to Borrower or the person shown on Lender’s recordsas being the owner of the Property and no other party shall have any right orclaim thereto. If at any time Lender reasonably determines that the Tax andInsurance Reserve Funds are not or will not be sufficient to pay Taxes andInsurance Premiums by the dates set forth in (a) and (b) above, Lender shallnotify Borrower of such determination and Borrower shall pay to Lender anyamount necessary to make up the deficiency within ten (10) days after noticefrom Lender to Borrower requesting payment thereof.

 

**Section 9.3.****                               ****Reserve Funds Generally**

 

(a)                                  No earnings or interest on the ReserveAccounts shall be payable to Borrower. Neither Lender nor any loan servicerthat at any time holds or maintains the Reserve Accounts shall have anyobligation to keep or maintain such Reserve Accounts or any funds deposited thereinin interest-bearing accounts. If Lender or any such loan servicer elects in itssole and absolute discretion to keep or maintain any Reserve Accounts or anyfunds deposited therein in an interest-bearing account (i) the account shall bean Eligible Account, (ii) such funds shall not be invested except in PermittedInvestments, and (iii) all interest earned or accrued thereon shall be for theaccount of and be retained by Lender or such loan servicer.

 

(b)                                 Borrower grants to Lender a first-priorityperfected security interest in, and assigns and pledges to Lender, each of theReserve Accounts and any and all funds hereafter deposited therein asadditional security for payment of the Debt. Until expended or applied in accordanceherewith, the Reserve Accounts and the Reserve Funds shall constituteadditional security for the Debt. The provisions of this Section 9.9 areintended to give Lender or any subsequent holder of the Loan “control” of theReserve Accounts within the meaning of the UCC.

 

(c)                                  The Reserve Accounts and any and all ReserveFunds deposited therein shall be subject to the exclusive dominion and controlof Lender, which shall hold the Reserve Accounts and any or all Reserve Fundsnow or hereafter deposited therein subject to the terms and conditions of thisAgreement. Borrower shall have no right of withdrawal from the Reserve Accountsor any other right or power with respect to the Reserve Accounts or any or allof the Reserve Funds hereinafter deposited therein, except as expresslyprovided in this Agreement.

 

(d)                                 Lender shall furnish or cause to be furnishedto Borrower, without charge, an annual accounting of each Reserve Account inthe normal format of Lender or its loan servicer, showing credits and debits tosuch Reserve Account and the purpose for which each debit to such ReserveAccount was made.

 

(e)                                       As long as no Event of Default has occurred,Lender shall make disbursements from the Reserve Accounts in accordance withthis Agreement. All such disbursements shall be

 

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deemedto have been expressly pre-authorized by Borrower, and shall not be deemed toconstitute the exercise by Lender of any remedies against Borrower unless anEvent of Default has occurred and is continuing and Lender has expressly statedin writing its intent to proceed to exercise its remedies as a secured party,pledgee or lienholder with respect to the Reserve Accounts.

 

(f)                                      The Reserve Funds shall not constitute escrowor trust funds and may be commingled with other monies held by Lender. Notwithstandinganything else herein to the contrary, Lender may commingle in one or moreEligible Accounts any and all funds controlled by Lender, including, withoutlimitation, funds pledged in favor of Lender by other borrowers, whether forthe same purposes as the Reserve Accounts or otherwise. Without limiting anyother provisions of this Agreement or any other Loan Document, the ReserveAccounts may be established and held in such name or names as Lender or itsloan servicer, as agent for Lender, shall deem appropriate, including, withoutlimitation, in the name of Lender or such loan servicer as agent for Lender. Inthe case of any Reserve Account which is held in a commingled account, Lenderor its loan servicer, as applicable, shall maintain records sufficient toenable it to determine at all times which portion of such account is related tothe Loan. The Reserve Accounts are solely for the protection of Lender andLender shall have no responsibility beyond the allowance of due credit for thesums actually received by Lender or beyond the reimbursement or payment of thecosts and expenses for which such accounts were established in accordance withtheir terms. Upon assignment of the Loan by Lender, any Reserve Funds shall beturned over to the assignee and any responsibility of Lender as assignor shallterminate. The requirements of this Agreement concerning Reserve Accounts in noway supersede, limit or waive any other rights or obligations of the partiesunder any of the Loan Documents or under applicable law.

 

(g)                                   Borrower shall not, without obtaining theprior written consent of Lender, further pledge, assign or grant any securityinterest in the Reserve Accounts or the Reserve Funds deposited therein orpermit any Lien to attach thereto, except for the security interest granted in thisSection 9.9, or any levy to be made thereon, or any UCC FinancingStatements, except those naming Lender as the secured party, to be filed withrespect thereto.

 

(h)                                 Borrower will maintain the security interestcreated by this Section 9.9 as a first priority perfected securityinterest and will defend the right, title and interest of Lender in and to theReserve Accounts and the Reserve Funds against the claims and demands of allPersons whomsoever. At any time and from time to time, upon the written requestof Lender, and at the sole expense of Borrower, Borrower will promptly and dulyexecute and deliver such further instruments and documents and will take suchfurther actions as Lender reasonably may request for the purpose of obtainingor preserving the full benefits of this Agreement and of the rights and powersherein granted.

 

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**ARTICLE 10CASH MANAGEMENT**

 

**Section 10.1.****                        ****Cash Management Account**

 

(a)                                   Borrower acknowledges and confirms thatBorrower has established, and Borrower covenants that it shall maintain anEligible Account into which Borrower shall, and shall cause Manager to, depositor cause to be deposited all Rents and other revenue from the Property duringthe Cash Management Period or upon the occurrence of an Event of Default priorto the commencement of the Cash Management Period pursuant to the terms of Section 10.2hereof (such account, the sub-accounts thereof, all funds at any time ondeposit therein and any proceeds, replacements or substitutions of such accountor funds therein, are referred to herein as the **“Cash Management Account”**).

 

(b)                                  The Cash Management Account shall be in thename of Borrower for the benefit of Lender, provided that Borrower shall be theowner of all funds on deposit in such accounts for federal and applicable stateand local tax purposes (except to the extent Lender retains any interest earnedon the Cash Management Account for its own account following the occurrence andduring the continuance of an Event of Default). Sums on deposit in the CashManagement Account shall not be invested except in such Permitted Investmentsas determined and directed by Lender and all income earned thereon shall be theincome of Borrower and be applied to and become part of the Cash ManagementAccount, to be disbursed in accordance with this Article 10. Lender shallhave no liability for any loss resulting from the investment of funds in PermittedInvestments in accordance with the terms and conditions of this Agreement.

 

(c)                                   The Cash Management Account shall be subjectto the exclusive dominion and control of Lender during the Cash ManagementPeriod or the continuance of an Event of Default and, except as otherwiseexpressly provided herein, neither Borrower, Manager nor any other partyclaiming on behalf of, or through, Borrower or Manager, shall have any right ofwithdrawal therefrom or any other right or power with respect thereto.

 

(d)                                  Borrower agrees to pay the customary fees andexpenses incurred in connection with maintaining the Cash Management Account.

 

(e)                                   Lender shall be responsible for theperformance only of such duties with respect to the Cash Management Account asare specifically set forth herein, and no duty shall be implied from anyprovision hereof. Lender shall not be under any obligation or duty to perform anyact which would involve it in expense or liability or to institute or defendany suit in respect hereof, or to advance any of its own monies. Borrower shallindemnify and hold Lender and its directors, employees, officers and agentsharmless from and against any loss, cost or damage (including, withoutlimitation, reasonable attorneys’ fees and disbursements) incurred by such partiesin connection with the Cash Management Account other than such as result fromthe gross negligence or willful misconduct of Lender or intentionalnonperformance by Lender of its obligations under this Agreement.

 

**Section 10.2.****                        ****Deposits and Withdrawals**

 

(a)                                  Borrower represents, warrants and covenantsthat:

 

(i)                                     Concurrently with the execution of thisAgreement Borrower has executed and delivered to Lender an instruction letterin the form of Exhibit B attached hereto addressed to American Express (the “TenantDirection Letter”). Upon the occurrence of

 

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an Event of Default or upon commencement of the Cash Management Period,Lender or Lender’s agent shall have the right to deliver the Tenant DirectionLetter to American Express and all payments of Rent and other items payableunder the American Express Lease shall thereafter be sent directly to the CashManagement Account;

 

(ii)           On the occurrence of an Event of Default orthe commencement of the Cash Management Period Borrower shall, and shall causeManager to, instruct all Persons that maintain open accounts with Borrower orManager with respect to the Property or with whom Borrower or Manager doesbusiness on an “accounts receivable” basis with respect to the Property todeliver all payments due under such accounts to the Cash Management Account.Neither Borrower nor Manager shall direct any such Person to make payments dueunder such accounts in any other manner;

 

(iii)          All Rents or other income from the Propertyreceived after the commencement of the Cash Management Period or the occurrenceof an Event of Default shall (A) be deemed additional security for payment ofthe Debt and shall be held in trust for the benefit, and as the property, ofLender, (B) not be commingled with any other funds or property of Borrower orManager, and (C) if received by Borrower or Manager notwithstanding thedelivery of the Tenant Direction Letter, be deposited in the Cash ManagementAccount within one (1) Business Day of receipt;

 

(iv)          Without the prior written consent of Lender,so long as any portion of the Debt remains outstanding, during the CashManagement Period or the continuance of an Event of Default neither Borrowernor Manager shall terminate, amend, revoke or modify the Tenant DirectionLetter in any manner whatsoever or direct or cause American Express to pay anyamount in any manner other than as provided in the Tenant Direction Letter; and

 

(v)           So long as any portion of the Debt remainsoutstanding, during the Cash Management Period or during the continuance of anEvent of Default neither Borrower, Manager nor any other Person shall open ormaintain any accounts other than the Cash Management Account into whichrevenues from the ownership and operation of the Property are deposited.

 

(b)          Intentionally Omitted.

 

(c)           If an Event of Default, shall have occurredand be continuing or during a Cash Management Period, on each Scheduled PaymentDate (and if such day is not a Business Day, then the immediately preceding daywhich is a Business Day) commencing the month immediately following the monthduring which the Cash Management Period commences, Borrower hereby irrevocablyauthorizes Lender to withdraw or allocate to the sub-accounts of the CashManagement Account, as the case may be, amounts received in the Cash ManagementAccount, in each case to the extent that sufficient funds remain therefor:

 

(i)            following a default by American Express underthe American Express Lease, funds sufficient to pay the monthly deposits to theTax and Insurance Reserve

 

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Account shall be allocated to the Tax and Insurance Reserve Account tobe held and disbursed in accordance with Section 9.2;

 

(ii)           funds sufficient to pay the Monthly PaymentAmount shall be withdrawn and paid to Lender;

 

(iii)          funds sufficient to pay any interest accruingat the Default Rate, late payment charges, if any, and any other sums due andpayable to Lender under any of the Loan Documents, shall be withdrawn and paidto Lender and applied against such items;

 

(iv)          funds sufficient to pay Operating Expenses (tothe extent actually incurred) for the following month shall be allocated to theOperating Expense Reserve Account to be held and disbursed to pay OperatingExpenses;

 

(v)           funds in an amount equal to the balance (ifany) remaining on deposit in the Cash Management Account after the foregoingwithdrawals and allocations shall be withdrawn and paid to Lender to be appliedto the principal amount of the Loan until the principal amount of the Loan ispaid in lull.

 

(d)           Notwithstanding anything to the contraryherein, Borrower acknowledges that Borrower is responsible for monitoring thesufficiency of funds deposited in the Cash Management Account and that Borroweris liable for any deficiency in available funds, irrespective of whetherBorrower has received any account statement, notice or demand from Lender orLender’s servicer. If the amount on deposit in the Cash Management Account is insufficientto make all of the withdrawals and allocations described in Section 10.2(c)(i)through (v) above, Borrower shall deposit such deficiency into the CashManagement Account within five (5) days (provided that such five day periodshall not constitute a grace period for any default or Event of Default underthis Agreement or any other Loan Document based on a failure to satisfy anymonetary obligation provided in any Loan Document).

 

(e)           If an Event of Default shall have occurredand be continuing, Borrower hereby irrevocably authorizes Lender to make anyand all withdrawals from the Cash Management Account and transfers between anyReserve Account as Lender shall determine in Lender’s sole and absolutediscretion and Lender may use all funds contained in any such accounts for any purpose,including but not limited to repayment of the Debt in such order, proportionand priority as Lender may determine in its sole and absolute discretion. Lender’sright to withdraw and apply funds as stated herein shall be in addition to allother rights and remedies provided to Lender under this Agreement, the Note,the Mortgage and the other Loan Documents.

 

**Section 10.3.        Security Interest**

 

(a)           To secure the full and punctual payment of the Debt and performance ofall obligations of Borrower now or hereafter existing under this Agreement andthe other Loan Documents, Borrower hereby grants to Lender a first-priorityperfected security interest in each of the Accounts and the Account Collateral.Furthermore, Borrower shall not, without obtaining the prior written consent ofLender, further pledge, assign or grant any security interest in any of theforegoing or permit any Lien to attach thereto or any levy to be made thereonor any UCC Financing Statements to be filed with respect thereto. Borrower willmaintain the security

 

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interestcreated by this Section 10.3(a) as a first priority perfected securityinterest and will defend the right, title and interest of Lender in and to eachof the Accounts and the Account Collateral against the claims and demands ofall Persons whomsoever.

 

(b)           Borrower authorizes Lender to file anyfinancing statement or statements required by Lender to establish or maintainthe validity, perfection and priority of the security interest granted hereinin connection with the Cash Management Account. Borrower agrees that at any timeand from time to time, at the expense of Borrower, Borrower will promptly andduly execute and deliver all further instruments and documents, and take allfurther action, that may be necessary or desirable, or that Lender mayreasonably request, in order to perfect and protect any security interestgranted or purported to be granted hereby (including, without limitation, any securityinterest in and to any Permitted Investments) or to enable Lender to exerciseand enforce its rights and remedies hereunder.

 

(c)            Upon the occurrence of an Event of Default,Lender may exercise any or all of its rights and remedies as a secured party,pledgee and lienholder with respect to the Accounts and the Account Collateral.Without limitation of the foregoing, upon any Event of Default, Lender may usethe Accounts and the Account Collateral for any of the following purposes: (A) repaymentof the Debt, including, but not limited to, principal prepayments and theprepayment premium applicable to such full or partial prepayment (asapplicable); (B) reimbursement of Lender for all losses, fees, costs andexpenses (including, without limitation, reasonable legal fees) suffered orincurred by Lender as a result of such Event of Default; (C) payment of any amountexpended in exercising any or all rights and remedies available to Lender atlaw or in equity or under this Agreement or under any of the other LoanDocuments; (D) payment of any item as required or permitted under thisAgreement; or (E) any other purpose permitted by applicable law; provided,however, that any such application of funds shall not cure or be deemed to cureany Event of Default. Without limiting any other provisions hereof, each of theremedial actions described in the immediately preceding sentence shall bedeemed to be a commercially reasonable exercise of Lender’s rights and remediesas a secured party with respect to the Accounts and the Account Collateral andshall not in any event be deemed to constitute a setoff or a foreclosure of astatutory banker’s lien. Nothing in this Agreement shall obligate Lender toapply all or any portion of the Accounts and the Account Collateral to effect acure of any Event of Default, or to pay the Debt, or in any specific order ofpriority. The exercise of any or all of Lender’s rights and remedies under thisAgreement or under any of the other Loan Documents shall not in any wayprejudice or affect Lender’s right to initiate and complete a foreclosure underthe Mortgage.

 

**ARTICLE 11**

**EVENTS****OF DEFAULT; REMEDIES**

 

**Section 11.1.        Eventof Default**

 

The occurrence of any one or more of the following events shallconstitute an **“Event of Default”:**

 

(a)           if any portion of the Debt is not paid on or prior to the tenth dayfollowing the date the same is due or if the entire Debt is not paid on orbefore the Maturity Date;

 

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(b)          except as otherwise expressly provided in theLoan Documents, if any of the Taxes or Other Charges are not paid when the sameare due and payable, unless there is sufficient money in the Tax and InsuranceReserve Account for payment of amounts then due and payable and Lender’s accessto such money has not been constrained or restricted in any manner;

 

(c)           should American Express cease to be a self-insureror if the rating of American express issued by the Rating Agencies falls belowthe Trigger Rating, if (i) the Policies are not kept in full force and effect,or (ii) the Accord 28 (or similar) certificate is not delivered to Lender inaccordance with Section 8.1;

 

(d)          if Borrower breaches any covenant withrespect to itself contained in Article 6 or any covenant contained in Article 7hereof;

 

(e)           if any representation or warranty of, or withrespect to, Borrower or Borrower Principal, or any member, general partner,principal or beneficial owner of any of the foregoing, made herein, in anyother Loan Document, or in any certificate, report, financial statement or otherinstrument or document furnished to Lender at the time of the closing of theLoan or during the term of the Loan shall have been false or misleading in anymaterial respect when made;

 

(f)           if (i) Borrower, or any managing member orgeneral partner of Borrower, Borrower Principal, or American Express shallcommence any case, proceeding or other action (A) under any Creditors RightsLaws, seeking to have an order for relief entered with respect to it, orseeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, or(B) seeking appointment of a receiver, trustee, custodian, conservator or othersimilar official for it or for all or any substantial part of its assets, orBorrower, any managing member or general partner of Borrower, BorrowerPrincipal, or American Express shall make a general assignment for the benefitof its creditors; or (ii) there shall be commenced against Borrower, anymanaging member or general partner of Borrower, Borrower Principal, or AmericanExpress any case, proceeding or other action of a nature referred to in clause(i) above which (A) results in the entry of an order for relief or any suchadjudication or appointment or (B) remains undismissed, undischarged orunbonded for a period of sixty (60) days; or (iii) there shall be commenced againstBorrower, any managing member or general partner of Borrower, BorrowerPrincipal, or American Express any case, proceeding or other action seekingissuance of a warrant of attachment, execution, distraint or similar processagainst all or any substantial part of its assets which results in the entry ofany order for any such relief which shall not have been vacated, discharged, orstayed or bonded pending appeal within sixty (60) days from the entry thereof;or (iv) Borrower, any managing member or general partner of Borrower, BorrowerPrincipal, or American Express shall take any action in furtherance of, orindicating its consent to, approval of, or acquiescence in, any of the acts setforth in clause (i), (ii), or (iii) above; or (v) Borrower, any managing memberor general partner of Borrower, Borrower Principal, or American Express shallgenerally not, or shall be unable to, or shall admit in writing its inabilityto, pay its debts as they become due;

 

(g)          if Borrower shall be in default beyondapplicable notice and grace periods under any other mortgage, deed of trust,deed to secure debt or other security agreement covering any part of theProperty, whether it be superior or junior in lien to the Mortgage;

 

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(h)           if the Property becomes subject to any mechanic’s, materialman’s orother Lien other than a Lien for any Taxes or Other Charges not then due andpayable and the Lien shall remain undischarged of record (by payment, bondingor otherwise) for a period of thirty (30) days;

 

(i)            if any federal income tax lien is filedagainst Borrower, any member or general partner of Borrower, BorrowerPrincipal, or the Property and same is not discharged of record (or bonded orinsured to Lender’s satisfaction) within thirty (30) days after same is filed;

 

(j)            if an uninsured judgment is filed against theBorrower in excess of $20,000 which is not vacated or discharged (or bonded orinsured to Lender’s satisfaction) within 30 days;

 

(k)           if any default occurs under any guaranty or indemnity executed inconnection herewith and such default continues after the expiration ofapplicable grace periods, if any;

 

(l)            if Borrower shall permit any event within itscontrol to occur that would cause any REA to terminate without notice or actionby any party thereto or would entitle any party to terminate any REA and theterm thereof by giving notice to Borrower; or any REA shall be surrendered,terminated or canceled for any reason or under any circumstance whatsoeverexcept as provided for in such REA; or any term of any REA shall be modified orsupplemented unless permitted by the American Express Lease; or Borrower shallfail, within ten (10) Business Days after demand by Lender, to exercise itsoption to renew or extend the term (of any REA or shall fail or neglect topursue diligently all actions necessary to exercise such renewal rightspursuant to such REA except as provided for in such REA; or

 

(m)          if an American Express Lease Default shall occur under the AmericanExpress Lease; or

 

(n)           if Borrower shall continue to be in default under any other term,covenant or condition of this Agreement or any of the Loan Documents for morethan ten (10) days after notice from Lender in the case of any default whichcan be cured by the payment of a sum of money or for thirty (30) days after noticefrom Lender in the case of any other default, provided that if such defaultcannot reasonably be cured within such thirty (30) day period and Borrowershall have commenced to cure such default within such thirty (30) day periodand thereafter diligently and expeditiously proceeds to cure the same, suchthirty (30) day period shall be extended for so long as it shall requireBorrower in the exercise of due diligence to cure such default, it being agreedthat no such extension shall be for a period in excess of one hundred twenty(120) days.

 

**Section 11.2.        Remedies**

 

(a)           Upon the occurrence of an Event of Default (other than an Event ofDefault described in Section 11.1(1) above) and at any time thereafterLender may, in addition to any other rights or remedies available to itpursuant to this Agreement and the other Loan Documents or at law or in equity,take such action, without, notice or demand, that Lender deems advisable toprotect and enforce its rights against Borrower and in the Property, including,without limitation, declaring the Debt to be immediately due and payable, andLender may enforce or avail itself of any or all rights or remedies provided inthe Loan Documents against Borrower and the Property,

 

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including,without limitation, all rights or remedies available at law or in equity; andupon any Event of Default described in Section 11.1(f) above, the Debt andall other obligations of Borrower hereunder and under the other Loan Documents shallimmediately and automatically become due and payable, without notice or demand,and Borrower hereby expressly waives any such notice or demand, anythingcontained herein or in any other Loan Document to the contrary notwithstanding.

 

(b)           Upon the occurrence of an Event of Default, all or any one or more ofthe rights, powers, privileges and other remedies available to Lender againstBorrower under this Agreement or any of the other Loan Documents executed anddelivered by, or applicable to, Borrower or at law or in equity may beexercised by Lender at any time and from time to time, whether or not all orany of the Debt shall be declared due and payable, and whether or not Lendershall have commenced any foreclosure proceeding or other action for the enforcementof its rights and remedies under any of the Loan Documents with respect to theProperty. Any such actions taken by Lender shall be cumulative and concurrentand may be pursued independently, singularly, successively, together orotherwise, at such time and in such order as Lender may determine in its solediscretion, to the fullest extent permitted by law, without impairing orotherwise affecting the other rights and remedies of Lender permitted by law,equity or contract or as set forth herein or in the other Loan Documents.

 

**ARTICLE 12**

**ENVIRONMENTAL PROVISIONS**

 

**Section 12.1.        EnvironmentalRepresentations and Warranties**

 

Borrower represents and warrants, except as disclosed in anEnvironmental Report of the Property and information that Borrower knows that:(a) there are no Hazardous Materials or underground storage tanks in, on, orunder the Property, except those that are both (i) in compliance withEnvironmental Laws and with permits issued pursuant thereto (if such permitsare required), if any, and (ii) either (A) in the case of Hazardous Materials,in amounts not in excess of that necessary to operate the Property for thepurposes set forth herein or (B) fully disclosed to and approved by Lender inwriting pursuant to an Environmental Report; (b) there are no past, present orthreatened Releases of Hazardous Materials in violation of any EnvironmentalLaw or which would require remediation by a Governmental Authority in, on,under or from the Property except as described in the Environmental Report; (c)there is no threat of any Release of Hazardous Materials migrating to theProperty except as described in the Environmental Report; (d) there is no pastor present non-compliance with Environmental Laws, or with permits issuedpursuant thereto, in connection with the Property except as described in theEnvironmental Report; (e) Borrower does not know of, and has not received, anywritten or oral notice or other communication from any Person relating toHazardous Materials in, on, under or from the Property; (f) the Property isfree of Mold; and (g) Borrower has truthfully and fully provided to Lender, inwriting, any and all information relating to environmental conditions in, on,under or from the Property known to Borrower or contained in Borrower’s filesand records, including but not limited to any reports relating to HazardousMaterials in, on, under or migrating to or from the Property and/or to theenvironmental condition of or the presence of Mold at the Property.

 

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**Section 12.2.        Environmental Covenants**

 

Borrower covenants and agrees that so long as Borrower owns, managesand is in possession of the operation of the Property: (a) all uses andoperations on or of the Property, whether by Borrower or any other Person,shall be in compliance with all Environmental Laws and permits issued pursuantthereto; (b) there shall be no Releases of Hazardous Materials in, on, under orfrom the Property; (c) there shall be no Hazardous Materials in, on, or underthe Property, except those that are both (i) in compliance with allEnvironmental Laws and with permits issued pursuant thereto, if and to theextent required, and (ii) (A) in amounts not in excess of that necessary tooperate the Property for the purposes set forth herein or (B) fully disclosedto and approved by Lender in writing or (C) with respect to Mold, not in acondition, location, or of a type which may pose a risk to human health orsafety or the environment or which may result in damage to or would adverselyaffect or impair the value or marketability of the Property; (d) Borrower shallkeep the Property free and clear of all Environmental Liens; (c) Borrowershall, at its sole cost and expense, fully and expeditiously cooperate in allactivities pursuant to Section 12,4 below, including but not limited toproviding all relevant information and making knowledgeable persona availablefor interviews; (f) Borrower shall, at its sole cost and expense, perform anyenvironmental site assessment or other investigation of environmentalconditions in connection with the Property, pursuant to any reasonable writtenrequest of Lender, upon Lender’s reasonable belief that the Properly is not infull compliance with all Environmental Laws, and share with Lender the reportsand other results thereof, and Lender and other Indemnified Parties shall beentitled to rely on such reports and other results thereof; (g) Borrower shallkeep the Property free of Mold; and (h) Borrower shall, at its sole cost and expense,comply with all reasonable written requests of Lender to (i) reasonablyeffectuate remediation of any Hazardous Materials in, on, under or from theProperty; and (ii) comply with any Environmental Law; (i) Borrower shall notallow any tenant or other user of the Property to violate any EnvironmentalLaw; and (j) Borrower shall immediately notify Lender in writing after it hasbecome aware of (A) any presence or Release or threatened Release of HazardousMaterials in, on, under, from or migrating towards the Property; (B) anynon-compliance with any Environmental Laws related in any way to the Property;(C) any actual or potential Environmental Lien against the Property; (D) anyrequired or proposed remediation of environmental conditions relating to theProperty; and (E) any written or oral notice or other communication of whichBorrower becomes aware from any source whatsoever (including but not limited toa Governmental Authority) relating in any way to Hazardous Materials. Anyfailure of Borrower to perform its obligations pursuant to this Section 12.2shall constitute bad faith waste with respect to the Property.

 

**Section 12.3.        Lender’s Rights**

 

Lender and any other Person designated by Lender, including but notlimited to any representative of a Governmental Authority, and anyenvironmental consultant, and any receiver appointed by any court of competentjurisdiction, shall have the right, but not the obligation, to enter upon theProperty at all reasonable times to assess any and all aspects of the environmentalcondition of the Property and its use, including but not limited to conductingany environmental assessment or audit (the scope of which shall be determinedin Lender’s sole discretion) and taking samples of soil, groundwater or otherwater, air, or building materials, and conducting

 

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otherinvasive testing. Borrower shall cooperate with and provide access to Lenderand any such person or entity designated by Lender.

 

**Section 12.4.        Operationsand Maintenance Programs**

 

If recommended by the Environmental Report or any other environmentalassessment or audit of the Property, Borrower shall establish and comply withan operations and maintenance program with respect to the Property, in form andsubstance reasonably acceptable to Lender, prepared by an environmentalconsultant reasonably acceptable to Lender, which program shall address anyasbestos-containing material or lead based paint that may now or in the futurebe detected at or on the Property. Without limiting the generality of thepreceding sentence, Lender may require (a) periodic notices or reports toLender in form, substance and at such intervals as Lender may specify, (b) anamendment to such operations and maintenance program to address changingcircumstances, laws or other matters, (c) at Borrower’s sole expense,supplemental examination of the Property by consultants specified by Lender,(d) access to the Property by Lender, its agents or servicer, to review andassess the environmental condition of the Property and Borrower’s compliancewith any operations and maintenance program, and (e) variation of theoperations and maintenance program in response to the reports provided by anysuch consultants.

 

**Section 12.5.        EnvironmentalDefinitions**

 

**“Environmental Law”**means any present and future federal, stateand local laws, statutes, ordinances, rules, regulations, standards, policiesand other government directives or requirements, as well as common law,including but not limited to the Comprehensive Environmental Response,Compensation and Liability Act and the Resource Conservation and Recovery Act,that apply to Borrower or the Property and relate to Hazardous Materials orprotection of human health or the environment. **“Environmental Liens”**means all Liens and other encumbrancesimposed pursuant to any Environmental Law, whether due to any act or omissionof Borrower or any other Person. **“EnvironmentalReport”**means the written reports resulting from the environmentalsite assessments of the Property delivered to Lender in connection with theLoan. **“Hazardous Materials”**shallmean petroleum and petroleum products and compounds containing them, includinggasoline, diesel fuel and oil; explosives, flammable materials; radioactivematerials; polychlorinated biphenyls and compounds containing them; lead andlead-based paint; asbestos or asbestos-containing materials in any form that isor could become friable; underground or above-ground storage tanks, whetherempty or containing any substance; any substance the presence of which on theProperty is prohibited by any federal, state or local authority; any substancethat requires special handling; and any other material or substance now or inthe future defined as a “hazardous substance,” “hazardous material”, “hazardouswaste”, “toxic substance”, “toxic pollutant”, “contaminant”, or “pollutant”within the meaning of any Environmental Law. **“Mold”**shall mean any mold, fungi, bacterial or microbial matter present ator in the Property, including, without limitation, building materials which isin a condition, location or a type which may pose a risk to human health orsafety or the environment, may result in damage to or would adversely affect orimpair the value or marketability of the Property. **“Release”**of any Hazardous Materials includes but is notlimited to any release, deposit, discharge, emission, leaking, spilling,seeping, migrating, injecting,

 

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pumping,pouring, emptying, escaping, dumping, disposing or other movement of HazardousMaterials.

 

**ARTICLE 13 SECONDARY MARKET**

 

**Section 13.1.        Transferof Loan**

 

Lender may, at any time, sell, transfer or assign the Loan Documents,or grant participations therein (**“Participations”**) or syndicate theLoan (**“Syndication”**)or issue mortgage pass-through certificates or other securitiesevidencing a beneficial interest in a rated or unrated public offering orprivate placement (**“Securities”**) (a Syndication or theissuance of Participations and/or Securities, a **“Securitization”**).

 

**Section 13.2.        Delegationof Servicing**

 

At the option of Lender, the Loan may be serviced by a servicer/trusteeselected by Lender and Lender may delegate all or any portion of itsresponsibilities under this Agreement and the other Loan Documents to suchservicer/trustee pursuant to a servicing agreement between Lender and suchservicer/trustee.

 

**Section 13.3.        Disseminationof Information**

 

Lender may forward to each purchaser, transferee, assignee, or servicerof, and each participant, or investor in, the Loan, or any Participationsand/or Securities or any of their respective successors (collectively, the **“Investor”)**or any Rating Agency rating theLoan, or any Participations and/or Securities, each prospective Investor, andany organization maintaining databases on the underwriting and performance ofcommercial mortgage loans, all documents and information which Lender now hasor may hereafter acquire relating to the Debt and to Borrower, any managingmember or general partner thereof, Borrower Principal, and the Property,including financial statements, whether furnished by Borrower or otherwise, asLender determines necessary or desirable. Borrower irrevocably waives any andall rights it may have under applicable Legal Requirements to prohibit suchdisclosure, including but not limited to any right of privacy.

 

**Section 13.4.        Cooperation**

 

Borrower and Borrower Principal agree to cooperate with Lender inconnection with any sale or transfer of the Loan or any Participation and/orSecurities created pursuant to this Article 13, including, withoutlimitation, (a) the delivery of an estoppel certificate required in accordancewith Section 5.12(a) and such other documents as may be reasonablyrequested by Lender, (b) the execution of such amendments to the Loan Documentsas may be requested by the holder of the Note or the Rating Agencies orotherwise to effect the Securitization including, without limitation,bifurcation of the Loan into two or more components and/or separate notes; provided,however, that Borrower shall not be required to modify or amend any LoanDocument if such modification or amendment would (i) change the interest rate,the stated maturity or the amortization of principal set forth in the Note, exceptin connection with a bifurcation of the Loan which may result in varying fixedinterest rates and amortization schedules, but which shall

 

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havethe same initial weighted average coupon of the original Note, or (ii) in thereasonable judgment of Borrower, modify or amend any other material economicterm of the Loan, or (iii) in the reasonable judgment of Borrower, materiallyincrease Borrower’s obligations and liabilities under the Loan Documents, and(c) make changes to the organizational documents of Borrower and its principalsand/or use its best efforts to cause changes to the legal opinions delivered byBorrower in connection with the Loan, provided, that such changes shall notresult in a material adverse economic effect to Borrower. Borrower shall alsofurnish and Borrower and Borrower Principal consent to Lender furnishing tosuch Investors or such prospective Investors or such Rating Agency any and allinformation concerning the Property, the American Express Lease, the financialcondition of Borrower or Borrower Principal as may be requested by Lender, anyInvestor, any prospective Investor or any Rating Agency in connection with anysale or transfer of the Loan or any Participations or Securities. NeitherBorrower nor Borrower Principal shall be responsible for any costs incurred byLender in connection with a Securitization.

 

**ARTICLE 14 INDEMNIFICATIONS**

 

**Section 14.1.        GeneralIndemnification**

 

Borrower shall indemnify, defend and hold harmless the IndemnifiedParties from and against any and all Losses imposed upon or incurred by orasserted against any Indemnified Parties and directly or indirectly arising outof or in any way relating to any one or more of the following: (a) anyaccident, injury to or death of persons or loss of or damage to propertyoccurring in, on or about the Property or any part thereof or on the adjoiningsidewalks, curbs, adjacent property or adjacent parking areas, streets or ways;(b) any use, nonuse or condition in, on or about the Property or any partthereof or on the adjoining sidewalks, curbs, adjacent property or adjacentparking areas, streets or ways; (c) performance of any labor or services or thefurnishing of any materials or other property in respect of the Property or anypart thereof; (d) any failure of the Property to be in compliance with anyapplicable Legal Requirements; (e) any and all claims and demands whatsoeverwhich may be asserted against Lender by reason of any alleged obligations orundertakings on its part to perform or discharge any of the terms, covenants,or agreements contained in any Lease; (f) the holding or investing of theReserve Accounts, or (g) the payment of any commission, charge or brokerage feeto anyone which may be payable in connection with the funding of the Loan(collectively, the **“Indemnified Liabilities”**); provided, however, that Borrowershall not have any obligation to Lender hereunder to the extent that suchIndemnified Liabilities arise from the gross negligence, illegal acts, fraud orwillful misconduct of Lender. To the extent that the undertaking to indemnify, defendand hold harmless set forth in the preceding sentence may be unenforceablebecause it violates any law or public policy, Borrower shall pay the maximumportion that it is permitted to pay and satisfy under applicable law to thepayment and satisfaction of all Indemnified Liabilities incurred by Lender.

 

**Section 14.2.        Mortgageand Intangible Tax Indemnification**

 

Borrower shall, at its sole cost and expense, protect, defend, indemnify,release and hold harmless the Indemnified Parties from and against any and all Lossesimposed upon or incurred by or asserted against any Indemnified Parties anddirectly or indirectly arising out of or in any

 

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wayrelating to any tax on the making and/or recording of the Mortgage, the Note orany of the other Loan Documents, but excluding any income, franchise or othersimilar taxes.

 

**Section 14.3.        ERISAIndemnification**

 

Borrower shall, at its sole cost and expense, protect, defend,indemnify, release and hold harmless the Indemnified Parties from and againstany and all Losses (including, without limitation, reasonable attorneys’ feesand costs incurred in the investigation, defense, and settlement of Lossesincurred in correcting any prohibited transaction or in the sale of aprohibited loan, and in obtaining any individual prohibited transactionexemption under ERISA that may be required, in Lender’s sole discretion) thatLender may incur, directly or indirectly, as a result of a default under Section 4.9or Section 5.18 of this Agreement.

 

**Section 14.4.        Survival**

 

The obligations and liabilities of Borrower and Borrower Principalunder this Article 14 shall fully survive indefinitely notwithstanding anytermination, satisfaction, assignment, entry of a judgment of foreclosure,exercise of any power of sale, or delivery of a deed in lieu of foreclosure ofthe Mortgage.

 

**ARTICLE 15EXCULPATION**

 

**Section 15.1.        Exculpation**

 

(a)           Except as otherwise provided herein or in the other Loan Documents,Lender shall not enforce the liability and obligation of Borrower or BorrowerPrincipal, as applicable, to perform and observe the obligations containedherein or in the other Loan Documents by any action or proceeding wherein amoney judgment shall be sought against Borrower or Borrower Principal, exceptthat Lender may bring a foreclosure action, action for specific performance orother appropriate action or proceeding to enable Lender to enforce and realizeupon this Agreement, the Note, the Mortgage and the other Loan Documents, andthe interest in the Property, the Rents (following an Event of Default) and anyother collateral given to Lender created by this Agreement, the Note, theMortgage and the other Loan Documents; provided, however, that any judgment inany such action or proceeding shall be enforceable against Borrower or BorrowerPrincipal, as applicable, only to the extent of Borrower’s or BorrowerPrincipal’s interest in the Property, in the Rents and in any other collateralgiven to Lender. Lender, by accepting this Agreement, the Note, the Mortgageand the other Loan Documents, agrees that it shall not, except as otherwiseprovided in this Section 15.1, sue for, seek or demand any deficiencyjudgment against Borrower or Borrower Principal in any such action orproceeding, under or by reason of or under or in connection with thisAgreement, the Note, the Mortgage or the other Loan Documents. The provisionsof this Section 15.1 shall not, however, (i) constitute a waiver, releaseor impairment of any obligation evidenced or secured by this Agreement, theNote, the Mortgage or the other Loan Documents; (ii) impair the right of Lenderto name Borrower or Borrower Principal as a party defendant in any action orsuit for judicial foreclosure and sale under this Agreement and the Mortgage;(iii) affect the validity or enforceability of any indemnity (including,without limitation, those contained in Section 12.6

 

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andArticle 14 of this Agreement), environmental indemnity, guaranty, masterlease or similar instrument made in connection with this Agreement, the Note,the Mortgage and the other Loan Documents; (iv) impair the right of Lender toobtain the appointment of a receiver; (v) impair the enforcement of theassignment of leases provisions contained in the Mortgage; or (vi) impair theright of Lender to obtain a deficiency judgment or other judgment on the Noteagainst Borrower or Borrower Principal if necessary to obtain any InsuranceProceeds or Awards to which Lender would otherwise be entitled under thisAgreement; provided however, Lender shall only enforce such judgment to theextent of the Insurance Proceeds and/or Awards.

 

(b)           Notwithstanding the provisions of this Section 15.1 to thecontrary, Borrower and Borrower Principal shall be personally liable to Lenderon a joint and several basis for Losses due to:

 

(i)            fraud or intentional misrepresentation byBorrower, Borrower Principal or any other Affiliate of Borrower or BorrowerPrincipal in connection with the execution and the delivery of this Agreement,the Note, the Mortgage, any of the other Loan Documents, or any certificate,report, financial statement or other instrument or document furnished to Lenderat the time of the closing of the Loan or during the term of the Loan;

 

(ii)           Borrower’s misapplication or misappropriationof Rents received by Borrower after the occurrence of an Event of Default;

 

(iii)          Borrower’s misapplication or misappropriationof tenant security deposits or Rents collected in advance;

 

(iv)          the misapplication or the misappropriation ofInsurance Proceeds or Awards;

 

(v)           Borrower’s failure to pay Taxes, OtherCharges (except to the extent that sums sufficient to pay such amounts havebeen deposited in escrow with Lender pursuant to the terms hereof and thereexists no impediment to Lender’s utilization thereof), charges for labor ormaterials or other charges that can create liens on the Property beyond anyapplicable notice and cure periods specified herein;

 

(vi)          Borrower’s failure to return or to reimburseLender for all Personal Property taken from the Property by or on behalf ofBorrower and not replaced with Personal Property of the same utility and of thesame or greater value;

 

(vii)         any act of actual waste or arson by Borrower,any principal, Affiliate, member or general partner thereof or by BorrowerPrincipal, any principal, Affiliate, member or general partner thereof; or

 

(viii)        Borrower’s failure following any Event ofDefault to deliver to Lender upon demand all Rents and books and recordsrelating to the Property.

 

(c)           Notwithstanding the foregoing, the agreement of Lender not to pursuerecourse liability as set forth in subsection (a) above SHALL BECOME NULLAND VOID and shall be of no further force and effect and the Debt shall be fullyrecourse to Borrower and Borrower

 

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Principalon a joint and several basis in the event (i) of a breach by Borrower orBorrower Principal of any of the covenants set forth in Article 6 hereof,to the extent that such breach is (A) material and (B) is not cured withinfifteen (15) days of the earlier to occur of notice from Lender or Borrower’sknowledge of such breach, (ii) of a breach of any of the covenants set forth inArticle 7 hereof, (iii) the Property or any part thereof shall become anasset in a voluntary bankruptcy or insolvency proceeding of Borrower, (iv)Borrower, Borrower Principal or any Affiliate, officer, director, orrepresentative which controls, directly or indirectly, Borrower or BorrowerPrincipal files, or joins in the filing of, an involuntary petition againstBorrower under any Creditors Rights Laws, or solicits or causes to be solicitedpetitioning creditors for any involuntary petition against Borrower from anyPerson; (v) Borrower files an answer consenting to or otherwise acquiescing inor joining in any involuntary petition filed against it, by any other Personunder any Creditors Rights Laws, or solicits or causes to be solicitedpetitioning creditors for any involuntary petition from any Person; or (vi) anyAffiliate, officer, director, or representative which controls Borrowerconsents to or acquiesces in or joins in an application for the appointment ofa custodian, receiver, trustee, or examiner for Borrower or any portion of theProperty.

 

(d)           Nothing herein shall be deemed to be a waiver of any right which Lendermay have under Section 506(a), 506(b), 1111(b) or any other provision ofthe U.S. Bankruptcy Code to file a claim for the full amount of theindebtedness secured by the Mortgage or to require that all collateral shallcontinue to secure all of the indebtedness owing to Lender in accordance withthis Agreement, the Note, the Mortgage or the other Loan Documents.

 

**ARTICLE 16NOTICES**

 

**Section 16.1.        Notices**

 

All notices, consents, approvals and requests required or permittedhereunder or under any other Loan Document shall be given in writing and shallbe effective for all purposes if hand delivered or sent by (a) certified orregistered United States mail, postage prepaid, return receipt requested, (b)expedited prepaid overnight delivery service, either commercial or UnitedStates Postal Service, with proof of attempted delivery, or by (c) telecopier(with answer back acknowledged provided an additional notice is given pursuantto subsection (b) above), addressed as follows (or at such other addressand Person as shall be designated from time to time by any party hereto, as thecase may be, in a written notice to the other parties hereto in the mannerprovided for in this Section):

 
| If to Lender: |   | Bank of America, N.A.             |
|---------------|--------|-----------------------------------|
|          |   | Capital Markets Servicing  Group  |
|          |   | 900 West Trade Street,  Suite 650 |
|          |   | NCI-026-06-01                     |
|          |   | Charlotte, North Carolina  28255  |
|          |   | Attn: Servicing Manager           |
|          |   | Telephone No: (866) 531-0957      |

 

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| If to Borrower:           |   | Inland Western Greensboro  Airport Center, L.L.C. |
|---------------------------|--------|---------------------------------------------------|
|                      |   | c/o Inland Real Estate  Investment Corporation    |
|                      |   | 2901 Butterfield Road                             |
|                      |   | Oak Brook, Illinois 60523                         |
|                      |   | Attention: Roberta Matlin,  Vice President        |
|                      |   | Facsimile No.:  630-218-4965                      |
|                      |   |                                              |
| With a copy to:           |   | The Inland Real Estate  Group, Inc.               |
|                      |   | 2901 Butterfield Road                             |
|                      |   | Oak Brook, Illinois 60523                         |
|                      |   | Attention: General Counsel                        |
|                      |   | Facsimile No.: 630-218-4900                       |
|                      |   |                                              |
| If to Borrower Principal: |   | Inland Western Retail Real  Estate Trust, Inc.    |
|                      |   | 2901 Butterfield Road                             |
|                      |   | Oak Brook, Illinois 60523                         |
|                      |   | Roberta Matlin, Vice President                    |
|                      |   | Facsimile No.: 630-218-4965                       |
|                      |   |                                              |
| With a copy to:           |   | The Inland Real Estate  Group, Inc.               |
|                      |   | 2901 Butterfield Road                             |
|                      |   | Oak Brook, Illinois 60523                         |
|                      |   | Attention: General Counsel                        |
|                      |   | Facsimile No.:  630-218-4900                      |

 

Anotice shall be deemed to have been given: in the case of hand delivery, at thetime of delivery; in the case of registered or certified mail, when deliveredor the first attempted delivery on a Business Day; or in the case of expeditedprepaid delivery and telecopy, upon the first attempted delivery on a BusinessDay.

 

**ARTICLE 17FURTHER****ASSURANCES**

 

**Section 17.1.        Replacement Documents**

 

Upon receipt of an affidavit of an officer of Lender as to the loss,theft, destruction or mutilation of the Note or any other Loan Document whichis not of public record and, in the case of such mutilation upon surrender andcancellation of such Note or other Loan Document, Borrower will issue in lieuthereof a replacement Note or other Loan Document, dated the date of such lost,stolen, destroyed or mutilated Note or other Loan Document in the sameprincipal amount thereof and otherwise of like tenor.

 

**Section 17.2.        Recording of Mortgage, etc.**

 

Borrower forthwith upon the execution and delivery of the Mortgage andthereafter, from time to time, will cause the Mortgage and any of the otherLoan Documents creating a lien or security interest or evidencing the lienhereof upon the Property and each instrument of further

 

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assuranceto be filed, registered or recorded in such manner and in such places as may berequired by any present or future law in order to publish notice of and fullyto protect and perfect the lien or security interest hereof upon, and theinterest of Lender in, the Property. Borrower will pay all taxes, filing,registration or recording fees, and all expenses incident to the preparation,execution, acknowledgment and/or recording of the Note, the Mortgage, the otherLoan Documents, any note, deed of trust or mortgage supplemental hereto, anysecurity instrument with respect to the Property and any instrument of furtherassurance, and any modification or amendment of the foregoing documents, andall federal, state, county and municipal taxes, duties, imposts, assessmentsand charges arising out of or in connection with the execution and delivery ofthe Mortgage, any deed of trust or mortgage supplemental hereto, any securityinstrument with respect to the Property or any instrument of further assurance,and any modification or amendment of the foregoing documents, except whereprohibited by law so to do.

 

**Section 17.3.       ****Further****Acts,****Etc.**

 

Borrower will, at the cost of Borrower (except with respect to costsincurred by Lender, for which Lender shall be responsible), do, execute,acknowledge and deliver all and every further acts, deeds, conveyances, deedsof trust, mortgages, assignments, security agreements, control agreements,notices of assignments, transfers and assurances as Lender shall, from time totime, reasonably require, for the better assuring, conveying, assigning,transferring, and confirming unto Lender the property and rights herebymortgaged, deeded, granted, bargained, sold, conveyed, confirmed, pledged,assigned, warranted and transferred or intended now or hereafter so to be, orwhich Borrower may be or may hereafter become bound to convey or assign toLender, or for carrying out the intention or facilitating the performance ofthe terms of this Agreement or for filing, registering or recording theMortgage, or for complying with all Legal Requirements. Borrower, on demand,will execute and deliver, and in the event it shall fail to so execute anddeliver, hereby authorizes Lender to execute in the name of Borrower or withoutthe signature of Borrower to the extent Lender may lawfully do so, one or morefinancing statements and financing statement amendments to evidence more effectively,perfect and maintain the priority of the security interest of Lender in theProperty. Borrower grants to Lender an irrevocable power of attorney coupledwith an interest for the purpose of exercising and perfecting any and allrights and remedies available to Lender at law and in equity, including withoutlimitation, such rights and remedies available to Lender pursuant to this Section 17.3.

 

**Section 17.4.        Changes in****Tax, Debt,****Credit and Documentary Stamp Laws**

 

(a)           If any law is enacted or adopted or amended after the date of thisAgreement which deducts the Debt from the value of the Property for the purposeof taxation or which imposes a tax, either directly or indirectly, on the Debtor Lender’s interest in the Property, Borrower will pay the tax, with interestand penalties thereon, if any. If Lender is advised by counsel chosen by itthat the payment of tax by Borrower would be unlawful or taxable to Lender orunenforceable or provide the basis for a defense of usury then Lender shall havethe option by written notice of not less than one hundred eighty (80) days todeclare the Debt immediately due and payable.

 

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(b)           Borrower will not claim or demand or be entitled to any credit orcredits on account of the Debt for any part of the Taxes or Other Chargesassessed against the Property, or any part thereof, and no deduction shallotherwise be made or claimed from the assessed value of the Property, or anypart thereof, for real estate tax purposes by reason of the Mortgage or theDebt. If such claim, credit or deduction shall be required by law, Lender shallhave the option, by written notice of not less than one hundred eighty (80)days, to declare the Debt immediately due and payable.

 

If at any time the United States of America, any State thereof or anysubdivision of any such State shall require revenue or other stamps to beaffixed to the Note, the Mortgage, or any of the other Loan Documents or imposeany other tax or charge on the same, Borrower will pay for the same, withinterest and penalties thereon, if any.

 

**Section 17.5.        Expenses**

 

Borrower covenants and agrees to pay or, if Borrower fails to pay, toreimburse, Lender upon receipt of written notice from Lender for all reasonablecosts and expenses (including reasonable, actual attorneys’ fees anddisbursements and the allocated costs of internal legal services and all actualdisbursements of internal counsel) reasonably incurred by Lender in accordancewith this Agreement in connection with (a) the preparation, negotiation,execution and delivery of this Agreement and the other Loan Documents and theconsummation of**the transactionscontemplated hereby and thereby and all the costs of furnishing all opinions bycounsel for Borrower (including without limitation any opinions requested byLender as to any legal matters arising under this Agreement or the other LoanDocuments with respect to the Property); (b) Borrower’s ongoing performance ofand compliance with Borrower’s respective agreements and covenants contained inthis Agreement and the other Loan Documents on its part to be performed orcomplied with after the Closing Date, including, without limitation, confirmingcompliance with environmental and insurance requirements; (c) following arequest by Borrower, Lender’s ongoing performance and compliance with allagreements and conditions contained in this Agreement and the other LoanDocuments on its part to be performed or complied with after the Closing Date;(d) the negotiation, preparation, execution, delivery and administration of anyconsents, amendments, waivers or other modifications to this Agreement and theother Loan Documents and any other documents or matters requested by Lender;(e) securing Borrower’s compliance with any requests made pursuant to theprovisions of this Agreement; (f) the filing and recording fees and expenses,title insurance and reasonable fees and expenses of counsel for providing toLender all required legal opinions, and other similar expenses incurred increating and perfecting the Lien in favor of Lender pursuant to this Agreementand the other Loan Documents; (g) enforcing or preserving any rights, inresponse to third party claims or the prosecuting or defending of any action orproceeding or other litigation, in each case against, under or affectingBorrower, this Agreement, the other Loan Documents, the Property, or any othersecurity given for the Loan; and (h) enforcing any obligations of or collectingany payments due from Borrower under this Agreement, the other Loan Documentsor with respect to the Property or in connection with any refinancing orrestructuring of the credit arrangements provided under this Agreement in thenature of a “work-out” or of any insolvency or bankruptcy proceedings; provided,however, that Borrower shall not be liable for the payment of any such costsand expenses to the extent the same arise by reason of the gross negligence,illegal acts, fraud or willful misconduct of Lender.

 

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**ARTICLE 18WAIVERS**

 

**Section 18.1.        RemediesCumulative; Waivers**

 

The rights, powers and remedies of Lender under this Agreement shall becumulative and not exclusive of any other right, power or remedy which Lendermay have against Borrower or Borrower Principal pursuant to this Agreement orthe other Loan Documents, or existing at law or in equity or otherwise. Lender’srights, powers and remedies may be pursued singularly, concurrently orotherwise, at such time and in such order as Lender may determine in Lender’ssole discretion. No delay or omission to exercise any remedy, right or poweraccruing upon an Event of Default shall impair any such remedy, right or poweror shall be construed as a waiver thereof, but any such remedy, right or powermay be exercised from time to time and as often as may be deemed expedient. Awaiver of one Default or Event of Default with respect to Borrower shall not beconstrued to be a waiver of any subsequent Default or Event of Default byBorrower or to impair any remedy, right or power consequent thereon.

 

**Section 18.2.        Modification,Waiver in Writing**

 

No modification, amendment, extension, discharge, termination or waiverof any provision of this Agreement, or of the Note, or of any other LoanDocument, nor consent to any departure by Borrower therefrom, shall in anyevent be effective unless the same shall be in a writing signed by the partyagainst whom enforcement is sought, and then such waiver or consent shall beeffective only in the specific instance, and for the purpose, for which given.Except as otherwise expressly provided herein, no notice to, or demand onBorrower, shall entitle Borrower to any other or future notice or demand in thesame, similar or other circumstances.

 

**Section 18.3.        DelayNot a Waiver**

 

Neither any failure nor any delay on the part of Lender in insistingupon strict performance of any term, condition, covenant or agreement, orexercising any right, power, remedy or privilege hereunder, or under the Noteor under any other Loan Document, or any other instrument given as securitytherefor, shall operate as or constitute a waiver thereof, nor shall a singleor partial exercise thereof preclude any other future exercise, or the exerciseof any other right, power, remedy or privilege. In particular, and not by wayof limitation, by accepting payment after the due date of any amount payableunder this Agreement, the Note or any other Loan Document, Lender shall not bedeemed to have waived any right either to require prompt payment when due ofall other amounts due under this Agreement, the Note or the other LoanDocuments, or to declare a default for failure to effect prompt payment of anysuch other amount.

 

**Section 18.4.        Trialby Jury**

 

**BORROWER, BORROWER PRINCIPAL AND LENDER EACH HEREBY AGREESNOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND WAIVESANY RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW ORHEREAFTER EXIST WITH**

 

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**REGARD TO THE LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OROTHER ACTION ARISING IN CONNECTION THEREWITH. THIS WAIVER OF RIGHT TO TRIAL BYJURY IS****GIVEN****KNOWINGLYAND VOLUNTARILY BY BORROWER, BORROWER PRINCIPAL AND LENDER, AND IS INTENDED TOENCOMPASS INDIVIDUALLY EACH****INSTANCE****AND EACH****ISSUE AS****TO WHICH THE RIGHT TO ATRIAL BY JURY WOULD OTHERWISE ACCRUE. EACH OF LENDER, BORROWER PRINCIPAL ANDBORROWER IS HEREBY AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANYPROCEEDING AS CONCLUSIVE****EVIDENCE****OF THISWAIVER BY BORROWER, BORROWER PRINCIPAL AND LENDER.**

 

**Section 18.5.        Waiverof Notice**

 

Borrower shall not be entitled to any notices of any nature whatsoeverfrom Lender except with respect to matters for which this Agreement or theother Loan Documents specifically and expressly provide for the giving ofnotice by Lender to Borrower and except with respect to matters for whichBorrower is not, pursuant to applicable Legal Requirements, permitted to waivethe giving of notice. Borrower hereby expressly waives the right to receive anynotice from Lender with respect to any matter for which this Agreement or theother Loan Documents do not specifically and expressly provide for the givingof notice by Lender to Borrower.

 

**Section 18.6.        Remediesof Borrower**

 

In the event that a claim or adjudication is made that Lender or itsagents have acted unreasonably or unreasonably delayed acting in any case whereby law or under this Agreement or the other Loan Documents, Lender or suchagent, as the case may be, has an obligation to act reasonably or promptly,Borrower agrees that neither Lender nor its agents shall be liable for anymonetary damages, and Borrower’s sole remedies shall be limited to commencingan action seeking injunctive relief or declaratory judgment. The parties heretoagree that any action or proceeding to determine whether Lender has actedreasonably shall be determined by an action seeking declaratory judgment.Lender agrees that, in such event, it shall cooperate in expediting any actionseeking injunctive relief or declaratory judgment.

 

**Section 18.7.        Waiverof Marshalling of Assets**

 

To the fullest extent permitted by law, Borrower, for itself and itssuccessors and assigns, waives all rights to a marshalling of the assets ofBorrower, Borrower’s partners and others with interests in Borrower, and of theProperty, and agrees not to assert any right under any laws pertaining to themarshalling of assets, the sale in inverse order of alienation, homesteadexemption, the administration of estates of decedents, or any other matterswhatsoever to defeat, reduce or affect the right of Lender under the LoanDocuments to a sale of the Property for the collection of the Debt without anyprior or different resort for collection or of the right of Lender to thepayment of the Debt out of the net proceeds of the Property in preference toevery other claimant whatsoever.

 

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**Section 18.8.        Waiverof Statute of Limitations**

 

Borrower hereby expressly waives and releases, to the fullest extentpermitted by law, the pleading of any statute of limitations as a defense topayment of the Debt or performance of its Other Obligations.

 

**Section 18.9.        Waiverof Counterclaim**

 

Borrower hereby waives the right to assert a counterclaim, other than acompulsory counterclaim, in any action or proceeding brought against it byLender or its agents.

 

**ARTICLE 19GOVERNING LAW**

 

**Section 19.1.        Choiceof Law**

 

This Agreement shall be deemed to be a contract entered into pursuantto the laws of the State and shall in all respects be governed, construed,applied and enforced in accordance with the laws of the State and applicablelaws of the United States of America, provided, however, that with respect tothe security interest in each of the Reserve Accounts, and the Cash ManagementAccount, the laws of the state where each such account is located shall apply.

 

**Section 19.2.        Severability**

 

Wherever possible, each provision of this Agreement shall beinterpreted in such manner as to be effective and valid under applicable law,but if any provision of this Agreement shall be prohibited by or invalid underapplicable law, such provision shall be ineffective to the extent of suchprohibition or invalidity, without invalidating the remainder of such provisionor the remaining provisions of this Agreement.

 

**Section 19.3.        Preferences**

 

Lender shall have the continuing and exclusive right to apply orreverse and reapply any and all payments by Borrower to any portion of theobligations of Borrower hereunder. To the extent Borrower makes a payment orpayments to Lender, which payment or proceeds or any part thereof aresubsequently invalidated, declared to be fraudulent or preferential, set asideor required to be repaid to a trustee, receiver or any other party under anyCreditors Rights Laws, state or federal law, common law or equitable cause,then, to the extent of such payment or proceeds received, the obligationshereunder or part thereof intended to be satisfied shall be revived andcontinue in full force and effect, as if such payment or proceeds had not beenreceived by Lender.

 

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**ARTICLE 20**

**MISCELLANEOUS**

 

**Section 20.1.        Survival**

 

This Agreement and all covenants, agreements, representations andwarranties made herein and in the certificates delivered pursuant hereto shallsurvive the making by Lender of the Loan and the execution and delivery toLender of the Note, and shall continue in full force and effect so long as allor any of the Debt is outstanding and unpaid unless a longer period isexpressly set forth herein or in the other Loan Documents. Whenever in thisAgreement any of the parties hereto is referred to, such reference shall bedeemed to include the legal representatives, successors and assigns of suchparty. All covenants, promises and agreements in this Agreement, by or onbehalf of Borrower, shall inure to the benefit of the legal representatives,successors and assigns of Lender.

 

**Section 20.2.        Lender’s****Discretion**

 

Whenever pursuant to this Agreement, Lender exercises any right givento it to approve or disapprove, or any arrangement or term is to besatisfactory to Lender, the decision of Lender to approve or disapprove or todecide whether arrangements or terms are satisfactory or not satisfactory shall(except as is otherwise specifically herein provided) be in the sole discretionof Lender and shall be final and conclusive.

 

**Section 20.3.        Headings**

 

The Article and/or Section headings and the Table of Contentsin this Agreement are included herein for convenience of reference only andshall not constitute a part of this Agreement for any other purpose.

 

**Section 20.4.        Cost of Enforcement**

 

In the event (a) that the Mortgage is foreclosed in whole or in part,(b) of the bankruptcy, insolvency, rehabilitation or other similar proceedingin respect of Borrower or any of its constituent Persons or an assignment byBorrower or any of its constituent Persons for the benefit of its creditors, or(c) Lender exercises any of its other remedies under this Agreement or any ofthe other Loan Documents, Borrower shall be chargeable with and agrees to payall costs of collection and defense, including attorneys’ fees and costs,incurred by Lender or Borrower in connection therewith and in connection withany appellate proceeding or post-judgment action involved therein, togetherwith all required service or use taxes.

 

**Section 20.5.        Schedules Incorporated**

 

The Schedules annexed hereto are hereby incorporated herein as a partof this Agreement with the same effect as if set forth in the body hereof.

 

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**Section 20.6.        Offsets,Counterclaims and Defenses**

 

Any assignee of Lender’s interest in and to this Agreement, the Noteand the other Loan Documents shall take the same free and clear of all offsets,counterclaims or defenses which are unrelated to such documents which Borrowermay otherwise have against any assignor of such documents, and no suchunrelated counterclaim or defense shall be interposed or asserted by Borrowerin any action or proceeding brought by any such assignee upon such documentsand any such right to interpose or assert any such unrelated offset,counterclaim or defense in any such action or proceeding is hereby expresslywaived by Borrower.

 

**Section 20.7.       ****No****Joint Venture orPartnership;****No****Third Party Beneficiaries**

 

(a)           Borrower and Lender intend that therelationships created hereunder and under the other Loan Documents be solelythat of borrower and lender. Nothing herein or therein is intended to create ajoint venture, partnership, tenancy-in-common, or joint tenancy relationship betweenBorrower and Lender nor to grant Lender any interest in the Property other thanthat of mortgagee, beneficiary or lender.

 

(b)           This Agreement and the other Loan Documentsare solely for the benefit of Lender and Borrower and nothing contained in thisAgreement or the other Loan Documents shall be deemed to confer upon anyoneother than Lender and Borrower any right to insist upon or to enforce theperformance or observance of any of the obligations contained herein ortherein. All conditions to the obligations of Lender to make the Loan hereunderare imposed solely and exclusively for the benefit of Lender and no otherPerson shall have standing to require satisfaction of such conditions inaccordance with their terms or be entitled to assume that Lender will refuse tomake the Loan in the absence of strict compliance with any or all thereof andno other Person shall under any circumstances be deemed to be a beneficiary ofsuch conditions, any or all of which may be freely waived in whole or in partby Lender if, in Lender’s sole discretion, Lender deems it advisable ordesirable to do so.

 

(c)           The general partners, members, principals and(if Borrower is a trust) beneficial owners of Borrower are experienced in theownership and operation of properties similar to the Property, and Borrower andLender are relying solely upon such expertise and business plan in connectionwith the ownership and operation of the Property. Borrower is not relying on Lender’sexpertise, business acumen or advice in connection with the Property.

 

(d)           Notwithstanding anything to the contrarycontained herein, Lender is not undertaking the performance of (i) anyobligations under the Leases; or (ii) any obligations with respect to suchagreements, contracts, certificates, instruments, franchises, permits,trademarks, licenses and other documents.

 

(e)           By accepting or approving anything requiredto be observed, performed or fulfilled or to be given to Lender pursuant tothis Agreement, the Mortgage, the Note or the other Loan Documents, including,without limitation, any officer’s certificate, balance sheet, statement ofprofit and loss or other financial statement, survey, appraisal, or insurancepolicy, Lender shall not be deemed to have warranted, consented to, or affirmedthe sufficiency, the legality or

 

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effectivenessof same, and such acceptance or approval thereof shall not constitute anywarranty or affirmation with respect thereto by Lender.

 

(f)            Borrower recognizes and acknowledges that inaccepting this Agreement, the Note, the Mortgage and the other Loan Documents,Lender is expressly and primarily relying on the truth and accuracy of therepresentations and warranties set forth in Article 4 of this Agreementwithout any obligation to investigate the Property and notwithstanding anyinvestigation of the Property by Lender; that such reliance existed on the partof Lender prior to the date hereof, that the warranties and representations area material inducement to Lender in making the Loan; and that Lender would notbe willing to make the Loan and accept this Agreement, the Note, the Mortgageand the other Loan Documents in the absence of the warranties andrepresentations as set forth in Article 4 of this Agreement.

 

**Section 20.8.        Publicity**

 

All news releases, publicity or advertising by Borrower or itsAffiliates through any media intended to reach the general public which refersto the Loan, Lender, Banc of America Securities LLC, or any of their Affiliatesshall be subject to the prior written approval of Lender, not to beunreasonably withheld. Lender shall be permitted to make any news, releases,publicity or advertising by Lender or its Affiliates through any media intendedto reach the general public which refers to the Loan, the Property, Borrower,Borrower Principal and their respective Affiliates without the approval ofBorrower or any such Persons. Borrower also agrees that Lender may share anyinformation pertaining to the Loan with Bank of America Corporation, includingits bank subsidiaries, Banc of America Securities LLC and any other Affiliatesof the foregoing, in connection with the sale or transfer of the Loan or anyParticipations and/or Securities created.

 

**Section 20.9.        Conflict; Construction of Documents;Reliance**

 

In the event of any conflict between the provisions of this Agreementand any of the other Loan Documents, the provisions of this Agreement shallcontrol. The parties hereto acknowledge that they were represented by competentcounsel in connection with the negotiation, drafting and execution of the LoanDocuments and that such Loan Documents shall not be subject to the principle ofconstruing their meaning against the party which drafted same. Borroweracknowledges that, with respect to the Loan, Borrower shall rely solely on itsown judgment and advisors in entering into the Loan without relying in anymanner on any statements, representations or recommendations of Lender or anyparent, subsidiary or Affiliate of Lender. Lender shall not be subject to anylimitation whatsoever in the exercise of any rights or remedies available to itunder any of the Loan Documents or any other agreements or instruments whichgovern the Loan by virtue of the ownership by it or any parent, subsidiary orAffiliate of Lender of any equity interest any of them may acquire in Borrower,and Borrower hereby irrevocably waives the right to raise any defense or takeany action on the basis of the foregoing with respect to Lender’s exercise ofany such rights or remedies. Borrower acknowledges that Lender engages in thebusiness of real estate financings and other real estate transactions andinvestments which may be viewed as adverse to or competitive with the businessof Borrower or its Affiliates.

 

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**Section 20.10.      Entire Agreement**

 

This Agreement and the other Loan Documents contain the entireagreement of the parties hereto and thereto in respect of the transactionscontemplated hereby and thereby, and all prior agreements among or between suchparties, whether oral or written between Borrower and Lender are superseded bythe terms of this Agreement and the other Loan Documents.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to beduly executed by their duly authorized representatives, all as of the day andyear first above written.

 
|   | BORROWER:                                                                                                                                                                  |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                       |   |
|   |                                                                                                                                                                       |   |
|   | INLAND WESTERN GREENSBORO  AIRPORT  CENTER, L.L.C., a Delaware limited liability  company                                                                                  |
|   |                                                                                                                                                                       |   |
|   | By:                                                                                                                                                                        | Inland Western Retail Real  Estate Trust,  Inc., a Maryland corporation, its sole  member |
|   |                                                                                                                                                                       |   |
|   |                                                                                                                                                                       | By: | /s/ Roberta S. Matlin |
|   |                                                                                                                                                                       | Name: |   | Roberta S. Matlin |
|   |                                                                                                                                                                       | Its: |   | Vice President |
|   |                                                                                                                                                                       |   |
|   |                                                                                                                                                                       |   |
|   | BORROWER PRINCIPAL:                                                                                                                                                        |
|   |                                                                                                                                                                       |   |
|   | Acknowledged and agreed to  with respect to its  obligations set forth in Article 4, Section 12.6,  Article 13, Article 15 and Article 18 hereof: |
|   |                                                                                                                                                                       |   |
|   |                                                                                                                                                                       |   |
|   | INLAND WESTERN RETAIL REAL  ESTATE  TRUST INC., a Maryland corporation, its                                                                                                |
|   |                                                                                                                                                                       |
|   | By:                                                                                                                                                                        | /s/ Roberta S. Matlin |   |
|   |                                                                                                                                                                       | Name: |   | Roberta S. Matlin |
|   |                                                                                                                                                                       | Title: |   |   | Vice President |
|        |                                                                                                                                                                            |  |  |  |  |  |  |  |  |  |  |  |  |

 

 

[ADDITIONAL SIGNATURE PAGE TO FOLLOW]

 

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|   | LENDER:                                                 |
|--------|---------------------------------------------------------|
|   |                                                    |   |   |
|   | BANK OF AMERICA, N.A., a  national banking  association |
|   |                                                    |   |   |
|   |                                                    |   |   |
|   | By:                                                     | /s/ Lisa K. McGee |
|   |                                                    | Name: |   | Lisa K. McGee |
|   |                                                    | Title: |   |   | Vice President |
|        |                                                         |  |  |  |  |  |  |  |  |

 

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EXHIBIT A

 

Borrower Equity Ownership Structure

 

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EXHIBIT B

 

Tenant Direction Letter

 

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