Exhibit
10.2


	
   

  



 


LOAN
AGREEMENT


 


 


Dated as of
December 8, 2006


 


 


Between


 


 


ART
MORTGAGE BORROWER PROPCO 2006-1B L.P.


and


ART
MORTGAGE BORROWER OPCO 2006-1B L.P.,


collectively,
as Borrower


 


 


and


 


 


UBS
REAL ESTATE SECURITIES INC.,


as
Lender


	
   

  



 

















 


TABLE OF CONTENTS


 


	
    

   	
    

   	
    

   	
   Page

   
	
   

  	
   

  	
   

  
	
  I.

  	
  DEFINITIONS; PRINCIPLES OF CONSTRUCTION

  	
  1

  
	
   

  	
  Section 1.1

  	
  Definitions

  	
  1

  
	
   

  	
  Section 1.2

  	
  Principles of Construction

  	
  23

  
	
  II.

  	
  THE LOAN

  	
  23

  
	
   

  	
  Section 2.1

  	
  The Loan

  	
  23

  
	
   

  	
  2.1.1

  	
  Agreement to Lend and Borrow

  	
  23

  
	
   

  	
  2.1.2

  	
  Single Disbursement to Borrower

  	
  23

  
	
   

  	
  2.1.3

  	
  The Note

  	
  23

  
	
   

  	
  2.1.4

  	
  Use of Proceeds

  	
  23

  
	
   

  	
  Section 2.2

  	
  Interest Rate

  	
  24

  
	
   

  	
  2.2.1

  	
  Applicable Interest Rate

  	
  24

  
	
   

  	
  2.2.2

  	
  Interest Calculation

  	
  24

  
	
   

  	
  2.2.3

  	
  Intentionally Omitted

  	
  24

  
	
   

  	
  2.2.4

  	
  Usury Savings

  	
  24

  
	
   

  	
  Section 2.3

  	
  Loan Payments

  	
  24

  
	
   

  	
  2.3.1

  	
  Payment Before Maturity Date

  	
  24

  
	
   

  	
  2.3.2

  	
  Payment on Maturity Date

  	
  25

  
	
   

  	
  2.3.3

  	
  Interest Rate and Payment after Default

  	
  25

  
	
   

  	
  2.3.4

  	
  Late Payment Charge

  	
  25

  
	
   

  	
  2.3.5

  	
  Method and Place of Payment

  	
  25

  
	
   

  	
  Section 2.4

  	
  Prepayments

  	
  26

  
	
   

  	
  2.4.1

  	
  Voluntary Prepayments

  	
  26

  
	
   

  	
  2.4.2

  	
  Mandatory Prepayments

  	
  29

  
	
   

  	
  2.4.3

  	
  Prepayments After Default

  	
  30

  
	
   

  	
  Section 2.5

  	
  Defeasanee

  	
  30

  
	
   

  	
  2.5.1

  	
  Total Defeasanee

  	
  30

  
	
   

  	
  2.5.2

  	
  Partial Defeasance

  	
  33

  
	
   

  	
  2.5.3

  	
  Defeasance Collateral Account

  	
  36

  
	
   

  	
  2.5.4

  	
  Successor Borrower

  	
  36

  
	
  III.

  	
  REPRESENTATIONS AND WARRANTIES

  	
  37

  



 


i

















 


TABLE OF CONTENTS


(continued)


 


	
    

   	
    

   	
    

   	
   Page

   
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 3.1

  	
  Borrower Representations

  	
  37

  
	
   

  	
  3.1.1

  	
  Organization

  	
  37

  
	
   

  	
  3.1.2

  	
  Proceedings

  	
  37

  
	
   

  	
  3.1.3

  	
  No Conflicts

  	
  37

  
	
   

  	
  3.1.4

  	
  Litigation

  	
  38

  
	
   

  	
  3.1.5

  	
  Orders and Decrees

  	
  38

  
	
   

  	
  3.1.6

  	
  Consents

  	
  38

  
	
   

  	
  3.1.7

  	
  Title

  	
  38

  
	
   

  	
  3.1.8

  	
  No Plan Assets

  	
  38

  
	
   

  	
  3.1.9

  	
  Compliance

  	
  39

  
	
   

  	
  3.1.10

  	
  Financial Information

  	
  39

  
	
   

  	
  3.1.11

  	
  Condemnation

  	
  39

  
	
   

  	
  3.1.12

  	
  Utilities and Public Access

  	
  39

  
	
   

  	
  3.1.13

  	
  Separate Lots

  	
  39

  
	
   

  	
  3.1.14

  	
  Assessments

  	
  39

  
	
   

  	
  3.1.15

  	
  Enforceability

  	
  40

  
	
   

  	
  3.1.16

  	
  Assignment of Leases

  	
  40

  
	
   

  	
  3.1.17

  	
  Insurance

  	
  40

  
	
   

  	
  3.1.18

  	
  Licenses

  	
  40

  
	
   

  	
  3.1.19

  	
  Flood Zone

  	
  40

  
	
   

  	
  3.1.20

  	
  Physical Condition

  	
  40

  
	
   

  	
  3.1.21

  	
  Boundaries

  	
  41

  
	
   

  	
  3.1.22

  	
  Leases

  	
  41

  
	
   

  	
  3.1.23

  	
  Filing and Recording Taxes

  	
  41

  
	
   

  	
  3.1.24

  	
  Single Purpose

  	
  41

  
	
   

  	
  3.1.25

  	
  Tax Filings

  	
  47

  
	
   

  	
  3.1.26

  	
  Solvency

  	
  47

  
	
   

  	
  3.1.27

  	
  Federal Reserve Regulations

  	
  47

  
	
   

  	
  3.1.28

  	
  Organizational Chart

  	
  47

  
	
   

  	
  3.1.29

  	
  Bank Holding Company

  	
  47

  



 


ii

















 


TABLE OF CONTENTS


(continued)


 


	
    

   	
    

   	
    

   	
   Page

   
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.1.30

  	
  No Other Debt

  	
  47

  
	
   

  	
  3.1.31

  	
  Investment Company Act

  	
  47

  
	
   

  	
  3.1.32

  	
  Intentionally Omitted

  	
  48

  
	
   

  	
  3.1.33

  	
  No Bankruptcy Filing

  	
  48

  
	
   

  	
  3.1.34

  	
  Full and Accurate Disclosure

  	
  48

  
	
   

  	
  3.1.35

  	
  Foreign Person

  	
  48

  
	
   

  	
  3.1.36

  	
  Intentionally Omitted

  	
  48

  
	
   

  	
  3.1.37

  	
  No Change in Facts or Circumstances Disclosure

  	
  48

  
	
   

  	
  3.1.38

  	
  Property Management

  	
  48

  
	
   

  	
  3.1.39

  	
  Perfection of Accounts

  	
  48

  
	
   

  	
  3.1.40

  	
  Agreements

  	
  49

  
	
   

  	
  3.1.41

  	
  Intentionally Omitted

  	
  49

  
	
   

  	
  3.1.42

  	
  SPE Separateness Covenants

  	
  49

  
	
   

  	
  Section 3.2

  	
  Survival of
  Representations

  	
  49

  
	
  IV.

  	
  BORROWER COVENANTS

  	
  49

  
	
   

  	
  Section 4.1

  	
  Borrower Affirmative
  Covenants

  	
  49

  
	
   

  	
  4.1.1

  	
  Existence; Compliance with Legal Requirements

  	
  49

  
	
   

  	
  4.1.2

  	
  Taxes and Other Charges

  	
  49

  
	
   

  	
  4.1.3

  	
  Litigation

  	
  50

  
	
   

  	
  4.1.4

  	
  Access to Property

  	
  50

  
	
   

  	
  4.1.5

  	
  Further Assurances; Supplemental Mortgage Affidavits

  	
  50

  
	
   

  	
  4.1.6

  	
  Financial Reporting

  	
  51

  
	
   

  	
  4.1.7

  	
  Title to the Property

  	
  54

  
	
   

  	
  4.1.8

  	
  Estoppel Statement

  	
  54

  
	
   

  	
  4.1.9

  	
  Leases

  	
  54

  
	
   

  	
  4.1.10

  	
  Alterations

  	
  56

  
	
   

  	
  4.1.11

  	
  Intentionally Omitted

  	
  57

  
	
   

  	
  4.1.12

  	
  Material Agreements

  	
  57

  
	
   

  	
  4.1.13

  	
  Performance by Borrower

  	
  58

  
	
   

  	
  4.1.14

  	
  Costs of Enforcement/Remedying Defaults

  	
  58

  



 


iii

















 


TABLE OF CONTENTS


(continued)


 


	
    

   	
    

   	
    

   	
   Page

   
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.1.15

  	
  Business and Operations

  	
  58

  
	
   

  	
  4.1.16

  	
  Intentionally Omitted

  	
  58

  
	
   

  	
  4.1.17

  	
  Intentionally Omitted

  	
  58

  
	
   

  	
  4.1.18

  	
  Cash Management Agency Agreement

  	
  58

  
	
   

  	
  Section 4.2

  	
  Borrower Negative
  Covenants

  	
  59

  
	
   

  	
  4.2.1

  	
  Due on Sale and Encumbrance; Transfers of Interests

  	
  59

  
	
   

  	
  4.2.2

  	
  Liens

  	
  59

  
	
   

  	
  4.2.3

  	
  Dissolution

  	
  59

  
	
   

  	
  4.2.4

  	
  Change in Business

  	
  59

  
	
   

  	
  4.2.5

  	
  Debt Cancellation

  	
  59

  
	
   

  	
  4.2.6

  	
  Affiliate Transactions

  	
  59

  
	
   

  	
  4.2.7

  	
  Zoning

  	
  59

  
	
   

  	
  4.2.8

  	
  Assets

  	
  60

  
	
   

  	
  4.2.9

  	
  No Joint Assessment

  	
  60

  
	
   

  	
  4.2.10

  	
  Principal Place of Business

  	
  60

  
	
   

  	
  4.2.11

  	
  ERISA

  	
  60

  
	
   

  	
  4.2.12

  	
  Material Agreements

  	
  60

  
	
   

  	
  4.2.13

  	
  Intentionally Omitted

  	
  61

  
	
   

  	
  4.2.14

  	
  Intentionally Omitted

  	
  61

  
	
   

  	
  4.2.15

  	
  Intentionally Omitted

  	
  61

  
	
   

  	
  4.2.16

  	
  Cash Management Agency Agreement

  	
  61

  
	
  V.

  	
  INSURANCE, CASUALTY AND CONDEMNATION

  	
  61

  
	
   

  	
  Section 5.1

  	
  Insurance

  	
  61

  
	
   

  	
  5.1.1

  	
  Insurance Policies

  	
  61

  
	
   

  	
  5.1.2

  	
  Insurance Company

  	
  65

  
	
   

  	
  5.1.3

  	
  Current Insurance

  	
  66

  
	
   

  	
  Section 5.2

  	
  Casualty and Condemnation

  	
  66

  
	
   

  	
  5.2.1

  	
  Casualty

  	
  66

  
	
   

  	
  5.2.2

  	
  Condemnation

  	
  66

  
	
   

  	
  5.2.3

  	
  Casualty Proceeds

  	
  67

  



 


iv

















 


TABLE OF CONTENTS


(continued)


 


	
    

   	
    

   	
    

   	
   Page

   
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.3

  	
  Delivery of Net Proceeds

  	
  67

  
	
   

  	
  5.3.1

  	
  Minor Casualty or Condemnation

  	
  67

  
	
   

  	
  5.3.2

  	
  Major Casualty or Condemnation

  	
  67

  
	
  VI.

  	
  RESERVE FUNDS

  	
  71

  
	
   

  	
  Section 6.1

  	
  Required Repairs

  	
  71

  
	
   

  	
  6.1.1

  	
  Required Repairs and Deposit of Required Repair Funds

  	
  71

  
	
   

  	
  6.1.2

  	
  Release of Required Repair Funds

  	
  71

  
	
   

  	
  Section 6.2

  	
  Tax Funds

  	
  72

  
	
   

  	
  6.2.1

  	
  Deposits of Tax Funds

  	
  72

  
	
   

  	
  6.2.2

  	
  Release of Tax Funds

  	
  73

  
	
   

  	
  Section 6.3

  	
  Insurance Funds

  	
  73

  
	
   

  	
  6.3.1

  	
  Deposits of Insurance Funds

  	
  73

  
	
   

  	
  6.3.2

  	
  Release of Insurance Funds

  	
  74

  
	
   

  	
  Section 6.4

  	
  Capital Expenditure Funds

  	
  74

  
	
   

  	
  6.4.1

  	
  Deposits of Capital Expenditure Funds

  	
  74

  
	
   

  	
  6.4.2

  	
  Release of Capital Expenditure Funds

  	
  74

  
	
   

  	
  Section 6.5

  	
  Borrower Cash Collateral
  Funds

  	
  76

  
	
   

  	
  6.5.1

  	
  Deposits of Borrower Cash Collateral Funds

  	
  76

  
	
   

  	
  6.5.2

  	
  Release of Borrower Cash Collateral Funds

  	
  76

  
	
   

  	
  Section 6.6

  	
  Intentionally Omitted

  	
  76

  
	
   

  	
  Section 6.7

  	
  Intentionally Omitted

  	
  76

  
	
   

  	
  Section 6.8

  	
  Application of Reserve
  Funds

  	
  76

  
	
   

  	
  Section 6.9

  	
  Security Interest in
  Reserve Funds

  	
  77

  
	
   

  	
  6.9.1

  	
  Grant of Security Interest

  	
  77

  
	
   

  	
  6.9.2

  	
  Income Taxes

  	
  77

  
	
   

  	
  6.9.3

  	
  Prohibition Against Further Encumbrance

  	
  77

  
	
   

  	
  Section 6.10

  	
  Intentionally Omitted

  	
  77

  
	
   

  	
  Section 6.11

  	
  Provisions Regarding
  Letters of Credit

  	
  77

  
	
   

  	
  6.11.1

  	
  Security for Debt

  	
  77

  
	
   

  	
  6.11.2

  	
  Additional Rights of Lender

  	
  77

  



 


v

















 


TABLE OF CONTENTS


(continued)


 


	
    

   	
    

   	
    

   	
   Page

   
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.12

  	
  Guaranty or Letter of
  Credit in Lieu of Cash Deposit

  	
  78

  
	
  VII.

  	
  PROPERTY MANAGEMENT

  	
  79

  
	
   

  	
  Section 7.1

  	
  The Management Agreement

  	
  79

  
	
   

  	
  Section 7.2

  	
  Prohibition Against
  Termination or Modification

  	
  79

  
	
   

  	
  Section 7.3

  	
  Replacement of Manager

  	
  80

  
	
   

  	
  Section 7.4

  	
  The Cash Management Agency
  Agreement

  	
  80

  
	
  VIII.

  	
  PERMITTED TRANSFERS

  	
  80

  
	
   

  	
  Section 8.1

  	
  Permitted Transfer of
  Property

  	
  80

  
	
   

  	
  Section 8.2

  	
  Permitted Transfers of
  Interest in Borrower

  	
  82

  
	
  IX.

  	
  SALE AND SECURITIZATION OF MORTGAGE

  	
  83

  
	
   

  	
  Section 9.1

  	
  Sale of Mortgage and Securitization; Loan Components;
  Mezzanine Loans

  	
  83

  
	
   

  	
  Section 9.2

  	
  Securitization Indemnification

  	
  85

  
	
  X.

  	
  DEFAULTS

  	
  88

  
	
   

  	
  Section 10.1

  	
  Event of Default

  	
  88

  
	
   

  	
  Section 10.2

  	
  Remedies

  	
  90

  
	
   

  	
  Section 10.3

  	
  Right to Cure Defaults

  	
  92

  
	
   

  	
  Section 10.4

  	
  Remedies Cumulative

  	
  92

  
	
  XI.

  	
  MISCELLANEOUS

  	
  92

  
	
   

  	
  Section 11.1

  	
  Successors and Assigns

  	
  92

  
	
   

  	
  Section 11.2

  	
  Lender’s Discretion

  	
  92

  
	
   

  	
  Section 11.3

  	
  Governing Law

  	
  93

  
	
   

  	
  Section 11.4

  	
  Modification, Waiver in
  Writing

  	
  94

  
	
   

  	
  Section 11.5

  	
  Delay Not a Waiver

  	
  94

  
	
   

  	
  Section 11.6

  	
  Notices

  	
  95

  
	
   

  	
  Section 11.7

  	
  Trial by Jury

  	
  96

  
	
   

  	
  Section 11.8

  	
  Headings

  	
  96

  
	
   

  	
  Section 11.9

  	
  Severability

  	
  96

  
	
   

  	
  Section 11.10

  	
  Preferences

  	
  96

  
	
   

  	
  Section 11.11

  	
  Waiver of Notice

  	
  97

  



 


vi

















 


TABLE OF CONTENTS


(continued)


 


	
    

   	
    

   	
    

   	
   Page

   
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.12

  	
  Remedies of Borrower

  	
  97

  
	
   

  	
  Section 11.13

  	
  Expenses; Indemnity

  	
  97

  
	
   

  	
  Section 11.14

  	
  Schedules Incorporated

  	
  98

  
	
   

  	
  Section 11.15

  	
  Offsets, Counterclaims and
  Defenses

  	
  98

  
	
   

  	
  Section 11.16

  	
  No Joint Venture or
  Partnership; No Third Party Beneficiaries

  	
  98

  
	
   

  	
  Section 11.17

  	
  Publicity

  	
  99

  
	
   

  	
  Section 11.18

  	
  Waiver of Marshalling of
  Assets

  	
  99

  
	
   

  	
  Section 11.19

  	
  Waiver of
  Offsets/Defenses/Counterclaims

  	
  99

  
	
   

  	
  Section 11.20

  	
  Conflict; Construction of
  Documents; Reliance

  	
  99

  
	
   

  	
  Section 11.21

  	
  Brokers and Financial
  Advisors

  	
  100

  
	
   

  	
  Section 11.22

  	
  Exculpation

  	
  100

  
	
   

  	
  Section 11.23

  	
  Prior Agreements

  	
  102

  
	
   

  	
  Section 11.24

  	
  Servicer

  	
  102

  
	
   

  	
  Section 11.25

  	
  Joint and Several
  Liability

  	
  103

  
	
   

  	
  Section 11.26

  	
  Creation of Security
  Interest

  	
  103

  
	
   

  	
  Section 11.27

  	
  Assignments and
  Participations

  	
  103

  
	
   

  	
  Section 11.28

  	
  Cross Default; Cross-Collateraltzation

  	
  105

  
	
   

  	
  Section 11.29

  	
  Substitution

  	
  106

  
	
   

  	
  Section 11.30

  	
  Partial Release - Expansion

  	
  111

  



 


vii

















 


TABLE OF CONTENTS


(continued)


 


SCHEDULES


 


	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  Schedule
  I

  	
  —

  	
  Major
  Customer List

  	
   

  
	
  Schedule
  II

  	
  —

  	
  Required
  Repairs

  	
   

  
	
  Schedule
  III

  	
  —

  	
  Organizational
  Chart

  	
   

  
	
  Schedule
  IV

  	
  —

  	
  Form of
  Subordination, Non-Disturbance and Attornment Agreement

  	
   

  
	
  Schedule
  V

  	
  —

  	
  Reserved

  	
   

  
	
  Schedule
  VI

  	
  —

  	
  List
  of Properties, Allocated Loan Amounts, Allocated UCF Amounts, Allocated Capital
  Expenditure Amounts and Title

  	
   

  
	
  Schedule
  VII

  	
  —

  	
  Proposed
  Annual Budget

  	
   

  
	
  Schedule
  VIII

  	
  —

  	
  Leases
  with Major Tenants

  	
   

  
	
  Schedule
  IX

  	
  —

  	
  List
  of Properties with no Certificate of Occupancy

  	
   

  
	
  Schedule
  X

  	
  —

  	
  Reserved

  	
   

  
	
  Schedule
  XI

  	
  —

  	
  Excluded
  Lender Transferees

  	
   

  
	
  Schedule
  XII

  	
  —

  	
  Form of
  Alteration Guaranty

  	
   

  
	
  Schedule
  3.1

  	
  —

  	
  Disclosure
  Schedule

  	
   

  



 


viii














 


LOAN
AGREEMENT


 


THIS LOAN AGREEMENT, dated as of December 8,
2006 (as amended, restated, replaced, supplemented or otherwise modified from
time to time, this “Agreement”), between UBS REAL ESTATE SECURITIES INC., a Delaware corporation,
having an address at 1285 Avenue of the Americas, New York, New York 10019 (“Lender”),
and ART MORTGAGE BORROWER PROPCO 2006-1B L.P.,
a Delaware limited partnership (“Propco Borrower”), and ART MORTGAGE BORROWER OPCO 2006-1B L.P., a
Delaware limited partnership (“Opco Borrower”, and together with Propco
Borrower, individually or collectively, as the context may require, “Borrower”),
each having an address at 10 Glenlake Parkway, Suite 800, Atlanta, Georgia
30328.


 


All
capitalized terms used herein shall have the respective meanings set forth in Article I
hereof.


 


W I T N E S S E T H:


 


WHEREAS, Borrower desires to obtain the Loan (as
hereinafter defined) from Lender; and


 


WHEREAS, Lender is willing to make
the Loan to Borrower, subject to and in accordance with the terms of this
Agreement and the other Loan Documents (as hereinafter defined).


 


NOW,
THEREFORE, in consideration of the covenants set forth in this Agreement, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree, represent and warrant as
follows:


 


I.              DEFINITIONS; PRINCIPLES OF
CONSTRUCTION


 


Section 1.1            Definitions.  For all purposes of this Agreement, except as
otherwise expressly provided:


 


“Accounts”
shall have the meaning set forth in the Cash Management Agreement.


 


“Affiliate”
shall mean, as to any Person, any other Person that, directly or indirectly,
owns forty percent (40%) or more of, is in control of, is controlled by or is
under common ownership or control with such Person or is a director, trustee or
officer of such Person or of an Affiliate of such Person.  As used in this definition, the term “control”
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management, policies or activities of a Person, whether
through ownership of voting securities, by contract or otherwise.


 


“Agent”
shall mean U.S. Bank National Association or any successor Eligible Institution
thereto acting as Agent under the Cash Management Agreement.


 


1

















 


“Allocated
Capital Expenditure Amount” shall mean the portion of the Capital
Expenditure Maximum Amount allocated to each Individual Property, as set forth
on Schedule VI.


 


“Allocated
Loan Amount” shall mean the portion of the Loan allocated to each
Individual Property, as set forth on Schedule VI as the same may be
reduced pursuant to Section 2.4.2.


 


“Allocated
UCF Amount” shall mean, with respect to any Individual Property, one
hundred percent (100%) of the portion of the Underwritable Cash Flow allocated
to such Individual Property as of the date hereof, as set forth on Schedule
VI.


 


“Allocated
UCF Cash Trap Amount” shall mean, with respect to any Individual Property,
eighty percent (80.0%) of the Allocated UCF Amount for such Individual
Property, as set forth on Schedule VI.


 


“Allocated
UCF Trigger Amount” shall mean, with respect to any Individual Property,
eighty-five percent (85.0%) of
the Allocated UCF Amount for such Individual Property, as set forth on Schedule
VI.


 


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


 


“Alteration”
shall mean any demolition, alteration, installation, improvement or decoration
of or to any Improvements at any Individual Property or any part thereof (it
being agreed that any expansion of the Improvements at any Individual Property
shall not be deemed to be an “Alteration” hereunder so long as such expansion
is undertaken and completed in accordance with Legal Requirements and this
definition shall specifically exclude Required Repairs).


 


“Alteration
Collateral” shall have the meaning set forth in Section 4.1.10(a).


 


“Alteration
Guaranty” shall have the meaning set forth in Section 4.1.10(a).


 


“Alteration
Security” shall have the meaning set forth in Section 4.1.10(a).


 


“Alteration
Threshold” shall mean the lesser of (i) five percent (5%) of the
aggregate outstanding principal amount of the Loan with respect to all
Alterations at any time to all of the Properties or, (ii) with respect to
any affected Individual Property, fifteen percent (15%) of the Allocated Loan Amount for such Individual Property.


 


“Annual
Budget” shall mean the operating and capital budget for the Property
setting forth Borrower’s good faith estimate of Gross Revenue, Operating
Expenses, and Capital Expenditures for the applicable Fiscal Year.


 


“Applicable
interest Rate” shall mean 5.4335% per
annum.


 


“Appraisal”
shall mean an M.A.I. appraisal of the Property in its then “as is” condition,
prepared not more than ninety (90) days (or such longer period as shall be
acceptable 


 


2

















 


to Lender) prior to the date delivered to Lender or Servicer in
connection with the relevant
event or approval; which appraisal (i) shall meet the minimum appraisal standards
for national banks promulgated by the Comptroller of the Currency pursuant to
Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of
1989, as amended (FIRREA), and (ii) otherwise shall be in both form and
substance (including with respect to methods, procedures and scope of services)
reasonably satisfactory to Lender.


 


“Approved
Annual Budget” shall have the meaning set forth in
Section 4.1.6(e).


 


“Assignment
of Leases” shall mean, with respect to each Individual Property, that
certain first priority Assignment of Leases
and Rents, dated as of the date hereof, from Propco Borrower, as
assignor, to Lender, as assignee, as the same may be amended, restated,
replaced, supplemented or otherwise modified from time to time.


 


“Assignment
of Management Agreement” shall mean that certain Assignment of Management
Agreement and Subordination of Management Fees, dated as of the date hereof,
among Lender, Propco 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 connection
with a Condemnation in respect of all or any part of any Individual Property.


 


“Bankruptcy
Action” shall have the meaning set forth in Section 3.1.24(y).


 


“Bankruptcy
Code” shall mean Title 11 of the United States Code entitled “Bankruptcy,”
as amended from time to time, and any successor statute or statutes and all rules and
regulations from time to time promulgated thereunder, and any comparable
foreign laws relating to bankruptcy, insolvency or creditors’ rights.


 


“Basic
Carrying Costs” shall mean the sum of the following costs associated with
the Property for the relevant Fiscal Year or payment period: (i) Taxes and
(ii) Insurance Premiums.


 


“Borrower”
shall mean, individually or
collectively as the context may require, Propco Borrower and/or Opco Borrower.


 


“Borrower
Cash Collateral Funds” shall have the meaning set forth in Section 6.5.1.


 


“Borrower
Excess Cash Flow” shall have the meaning set forth in the Cash Management
Agreement.


 


“Borrower
GP” shall have the meaning set forth in Section 3.1.24(z).


 


“Business
Day” shall mean any day other than a Saturday, a Sunday or a legal holiday
on which national banks are not open for general business in (i) the State
of New York, (ii) the state where the corporate trust office of the
Trustee is located, or (iii) the state where the servicing offices of the
Servicer are located.


 


3

















 


“Capital
Expenditure Funds” shall have the meaning set
forth in Section 6.4.1.


 


“Capital
Expenditure Maximum Amount” shall mean, as of any date, an amount equal to
One Million Two Hundred Seventy-Four Thousand Six Hundred Sixty-Seven and
No/100 Dollars ($1,274,667.00) the Allocated Capital Expenditure Amount of each
Individual Property previously released from the lien of the Mortgage (or, in
lieu of such release, which Mortgage is assigned by Lender) pursuant to Section 2.4
or Section 2.5, and less the Allocated Capital Expenditure Amount
of a Substituted Property pursuant to Section 11.29, but plus the
Allocated Capital Expenditure Amount of a Substitute Property pursuant to Section 11.29,
subject in all cases to a maximum aggregate of $1,274,667.00.


 


“Capital
Expenditures” for any period shall mean amounts expended for replacements
and alterations to the Property and required to be capitalized according to
GAAP.


 


“Capital
Expenditures Work” shall mean any labor performed or materials installed in
connection with any Capital Expenditure.


 


“Cash
Management Agency Agreement” shall mean, collectively, (i) that
certain Cash Management Agency Agreement, dated as of the date hereof, between
Propco Borrower and Guarantor, (ii) that certain Cash Management
Sub-Agency Agreement dated as of the date hereof between Guarantor and
Logistics and (iii) that certain Administrative Services and Cost
Allocation Agreement dated as of the date hereof between Opco Borrower and
Logistics, in each case as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time in accordance with the
terms of this Agreement.


 


“Cash
Management Agreement” shall mean that certain Cash Management Agreement,
dated as of the date hereof, among Lender, Borrower, Manager and Agent.


 


“Cash
Trap Event” shall mean, on the relevant date, the fact that the annual
Underwritable Cash Flow for the Property determined by Lender as of the end of
each fiscal quarter (based on Borrower’s Fiscal Year) on a trailing four (4) quarter
basis is less than the Cash Trap UCF Amount.


 


“Cash
Trap Period” shall mean a period commencing on the first (1st) Business Day after a Cash
Trap Event has occurred to the first (l) Business Day after the related
Cash Trap Event has not existed for a period of two (2) consecutive fiscal
quarters.


 


“Cash
Trap UCF Amount” shall mean, as of any date, an amount equal to the
aggregate of the Allocated UCF Cash Trap Amounts of all individual Properties
less the Allocated UCF Cash Trap Amount of each Individual Property previously
released from the lien of the Mortgage (or, in lieu of such release, which
Mortgage was assigned by Lender) pursuant to Section 2.4 or Section 2.5.


 


“Casualty”
shall mean the occurrence of any casualty, damage or injury, by fire or otherwise,
to any Individual Property or any part thereof.


 


“Casualty
Consultant” shall mean an independent architect selected by Lender.


 


4

















 


“Casualty
Retainage” shall have the meaning set forth in Section 5.3.2(d).


 


“CEI”
shall mean Crescent Real Estate Equities Company, a Texas real estate
investment trust, and its permitted successors by merger, consolidation or
transfer of all or substantially all of the assets of CEI, subject to any terms, covenants and/or conditions of this
Agreement.


 


“Closing
Date” shall mean the date hereof.


 


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


 


“Condemnation”
shall mean a temporary or permanent taking by any Governmental Authority as the
result or in lieu or in anticipation of the exercise of the right of
condemnation or eminent domain, of all or any part of any Individual Property,
or any interest therein or right accruing thereto, including any right of
access thereto or any change of grade affecting any Individual Property or any
part thereof.


 


“Confidential”
shall mean that, prior to the occurrence of an Event of Default or special
servicing of the Loan for any reason whatsoever, such information shall not be
disseminated by Lender to the general public unless such information is already
in the public domain or unless Lender is otherwise required by law, legal
requirement or order, writ, subpoena or other directive of any Governmental
Authority.  Notwithstanding the
foregoing, Lender shall not be restricted or prohibited in any manner whatsoever
from providing such information to its consultants, attorneys or accountants,
the Servicer, any Rating Agencies or any potential participants or assignees
(other than any Excluded Lender Transferee) of all or any portion of the Loan
or in connection with a Securitization of all or any portion of the Loan.


 


“CRE”
shall mean Crescent Real Estate Equities Limited Partnership, a Delaware
limited partnership, and its permitted successors by merger, consolidation or
transfer of all or substantially all of the assets of CRE, subject to any terms,
covenants and/or conditions of this Agreement.


 


“Cross
Borrower” shall mean, collectively, ART Mortgage Borrower Opco 2006- 1C
L.P., a Delaware limited partnership, and ART Mortgage Borrower Propco 2006-1C
L.P., a Delaware limited partnership, and their respective successors by
merger, consolidation or transfer of all or substantially all of the assets of
such Person (except to the extent that any such merger, consolidation or
transfer may be prohibited hereunder).


 


“Cross
Event of Default” shall mean an “Event of Default” under and as defined in
the Cross Loan Agreement.


 


“Cross
Guaranty” shall mean that certain Cross Guaranty Agreement of even date
herewith made by Cross Borrower in favor of Lender, as the same may be amended,
restated, replaced, supplemented or otherwise modified from time to time.


 


5

















 


“Cross
Lender” shall mean the “Lender” under and as defined in the Cross Loan
Agreement.


 


“Cross
Loan” shall mean that certain loan in the original maximum principal amount
of Sixty-Nine Million and No/100 Dollars ($69,000,000.00) made by Cross Lender
to Cross Borrower pursuant to the Cross Loan Agreement.


 


“Cross
Loan Agreement” shall mean that certain Loan Agreement dated as of the date
hereof by and between Cross Borrower and Cross Lender, as the same may be
amended, restated, replaced, supplemented or otherwise modified from time to
time.


 


“Cross
Mortgage” shall mean the “Mortgage” under and as defined in the Cross Loan
Agreement.


 


“Cross
Security Agreement” shall mean the “Security Agreement” under and as
defined in the Cross Loan Agreement.


 


“Debt”
shall mean the outstanding principal amount of the Loan together with all
interest accrued and unpaid thereon and all other sums (including, without
limitation, any Yield Maintenance Premium) due to Lender in respect of the Loan
under the Note, this Agreement, the Mortgage, the Environmental Indemnity or
any other Loan Document.


 


“Debt
Service” shall mean, with respect to any particular period of time, scheduled
principal and interest payments under the Note.


 


“Debt
Service Coverage Ratio” shall mean, as of any date of calculation, the
ratio of (i) Underwritable Cash Flow for the twelve (12) calendar month
period immediately preceding such date to (ii) the projected Debt Service
that would be due for the twelve (12) calendar month period immediately
following such date based upon an assumed loan constant for such period equal to the Applicable Interest Rate.


 


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


 


“Default
Rate” shall mean, with respect to the Loan, a rate per annum equal to the
lesser of (i) the maximum rate permitted
by applicable law, or (ii) three
percent (3%) above the Applicable Interest Rate.


 


“Defeasance
Collateral” shall mean the Total Defeasance Collateral or the Partial
Defeasance Collateral as the context may require.


 


“Defeasance
Collateral Account” shall have the meaning set forth in Section 2.5.3.


 


“Defeasance
Date” shall mean the Total Defeasance
Date or the Partial Defeasance
Date as the context may require.


 


6

















 


“Defeasance
Event” shall the Total Defeasance Event or the Partial Defeasance Event as
the context may require.


 


“Defeasance
Security Agreement” shall mean a security agreement in form and substance
that would be reasonably satisfactory to a reasonably prudent lender
originating commercial loans for securitization similar to the Loan pursuant to
which Borrower grants Lender a perfected, first priority security interest in
the Defeasance Collateral Account and the Defeasance Collateral.


 


“Defeased
Note” shall have the meaning set forth in Section 2.5.2(a)(iv).


 


“Disclosure
Document” shall have the meaning set forth in Section 9.2(a).


 


“Disqualified
Transferee” shall mean any Person that (i) has (within the past seven (7) years)
defaulted, or is now in default, beyond any applicable cure period, of its
material obligations, under any written agreement with Lender, any affiliate of
Lender, any financial institution or other Person providing or arranging
financing; (ii) has been convicted in a criminal proceeding for a felony
or a crime involving moral turpitude or that is an organized crime figure or is
reputed (as determined by Lender in its sole discretion) to have substantial
business or other affiliations with an organized crime figure; (iii) has
at any time filed a voluntary petition under the Bankruptcy Code or any other
federal or state bankruptcy or insolvency law; (iv) as to which an
involuntary petition has at any time been filed under the Bankruptcy Code or
any other federal or state bankruptcy or insolvency law; (v) has at any
time filed an answer consenting to or acquiescing in any involuntary petition
filed against it by any other person under the Bankruptcy Code or any other
federal or state bankruptcy or insolvency law; (vi) has at any time
consented to or acquiesced in or joined in an application for the appointment
of a custodian, receiver, trustee or examiner for itself or any of its
property; (vii) has at any time made a general assignment for the benefit
of creditors, or has at any time admitted its insolvency or inability to pay
its debts as they become due; or (viii) has been found by a court of
competent jurisdiction or other governmental authority in a comparable
proceeding to have violated any federal or state securities laws or regulations
promulgated thereunder.


 


“Downgrade
Event” shall have the meaning set forth in Section 10.1(a)(xvi).


 


“Eligible
Account” shall mean an identifiable account which is separate from all
other funds held by the holding institution that is either (a) an account
or accounts maintained with the corporate trust department of a federal or
state-chartered depository institution or trust company which complies with the
definition of Eligible Institution or (b) a segregated trust account or
accounts maintained with the corporate trust department of a federal or state
chartered depository institution or trust company acting in its fiduciary
capacity which, in the case of a state chartered depository institution or
trust company is subject to regulations substantially similar to 12 C.F.R. §
9.10(b), having in either case a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by federal and state
authority.  An Eligible Account will not
be evidenced by a certificate of deposit, passbook or other instrument.


 


“Eligible
Institution” shall mean a federal or state chartered depository institution
or trust company insured by the Federal Deposit Insurance Corporation the
short-term unsecured 


 


7

















 


debt obligations or commercial paper of which are rated at least “A-l”
(or the equivalent) by S&P.  Moody’s
and Fitch in the case of accounts in which funds are held for thirty (30) days
or less or, in the case of accounts in which funds are held for more than
thirty (30) days, the long-term unsecured debt obligations of which are rated
at least “AA-” (or the equivalent) by S&P, Fitch and Moody’s.


 


“Environmental
Indemnity” shall mean that certain Environmental Indemnity Agreement dated
as of the date hereof executed by Borrower and Guarantor in connection with the
Loan for the benefit of Lender.


 


“Equipment”
shall have the meaning set forth in the granting clause of the Mortgage.


 


“ERISA”
shall have the meaning set forth in Section 3.1.8.


 


“Event
of Default” shall have the meaning set forth in Section 10.1.


 


“Exchange
Act” shall have the meaning set forth in Section 9.2(a).


 


“Excess
Alteration Amount” shall have the meaning set forth in Section 4.1.10(a).


 


“Excluded
Lender Transferee” shall mean any Person listed on Schedule XI and
its Affiliates.


 


“Excusable
Delay” shall mean a delay due to acts of God, governmental restrictions,
stays, judgments, orders, decrees, enemy actions, civil commotion, fire,
casualty, strikes, work stoppages, shortages of labor or materials or other
causes beyond the reasonable control of Borrower, but lack of funds in and of
itself shall not be deemed a cause beyond the control of Borrower.


 


“Expansion
Date” shall have the meaning set forth in Section 11.30(a)(i).


 


“Expansion
Parcel” shall mean an unimproved area or areas of any Individual Property
on which Rents are not payable
and Improvements (other than utilities and the like that are permitted pursuant
to a recorded agreement) are not situated, which area or areas are not
necessary for the use and operation of the remainder of such Individual
Property (except to the extent such use or operation is permitted pursuant to a
separate agreement), are designated by Borrower for expansion or any other
reasonable business purpose in order to service any customer or prospective
customer of Borrower or any Affiliate of Borrower, the transfer and separate
development of which would not, in Borrower’s judgment (provided Borrower has
certified the same) materially adversely affect the value of the remaining
portion of such Individual Property or the Underwritable Cash Flow from the
remaining portion of such Individual Property (taking into account, to the
extent applicable, any potential loss of revenue resulting if the transfer and
development of the Expansion Parcel were not to occur).


 


“Fiscal
Year” shall mean each twelve month period commencing on January 1 and
ending on December 31 during each year of the term of the Loan.


 


8

















 


“Fitch”
shall mean Fitch, Inc.


 


“GAAP”
shall mean generally accepted accounting principles in the United States of
America set forth in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board (or
agencies with similar functions of comparable stature and authority within the
accounting profession), or in such other statements by such entity as may be in
general use by significant segments of the U.S. accounting profession.


 


“Governmental
Authority” shall mean any court, board, agency, commission, office or
authority of any nature whatsoever or any governmental unit (federal, state,
county, district, municipal, city, foreign or otherwise) whether now or
hereafter in existence.


 


“Gross
Revenue” shall mean all revenue, derived from the ownership and operation
of the Property from whatever source, including, but not limited to, Rents, but
excluding receipts, revenues and other income generated from transportation
operations conducted or performed by Borrower or any of its Affiliates from or
with respect to any one or more Individual Properties, sales, use and occupancy
or other taxes on receipts required to be accounted for by the owner or
operator of the Property to any Governmental Authority, non-recurring revenues
as reasonably determined by Lender, proceeds from the sale or refinancing of
any Individual Property, security deposits (except to the extent determined by
Lender to be properly utilized to offset a loss of Rent), refunds and
uncollectible accounts, proceeds of casualty insurance and Awards (other than
business interruption or other loss of income insurance related to business
interruption or loss of income for the period in question), and any
disbursements to Borrower or any operator of the Property from the Reserve
Funds or any other fund established by the Loan Documents.


 


“Guarantor”
shall mean Americold Realty Trust, a Maryland real estate investment trust, and
its permitted successors by merger, consolidation or transfer of all or
substantially all of the assets of Americold
Realty Trust, subject to any terms, covenants and/or conditions of this
Agreement.


 


“Guaranty”
shall mean that certain Recourse Guaranty dated as of the date hereof executed
by the Guarantor in connection with
the Loan for the benefit of Lender.


 


“Improvements”
with respect to each Individual Property, shall have the meaning set forth in
the granting clause of the applicable Mortgage.


 


“Indebtedness”
shall mean, for any Person, without duplication: (i) all indebtedness of
such Person for borrowed money, for amounts drawn under a letter of credit, or
for the deferred purchase price of property for which such Person or its assets
is liable, (ii) all unfunded amounts under a loan agreement, letter of
credit, or other credit facility for which such Person would be liable if such
amounts were advanced thereunder, (iii) all amounts required to be paid by
such Person as a guaranteed payment to partners or a preferred or special
dividend, including any mandatory redemption of shares or interests, (iv) all
indebtedness guaranteed by such Person, directly or indirectly, (v) all
obligations under leases that constitute capital leases for which such Person
is liable, and (vi) all obligations of such Person under interest rate
swaps, 


 


9

















 


caps, floors, collars and other interest hedge agreements, in each case
whether such Person is liable contingently or otherwise, as obligor, guarantor
or otherwise, or in respect of which obligations such Person otherwise assures
a creditor against loss.


 


“Indemnified
Liabilities” shall have the meaning set forth in Section 11.13(b).


 


“Independent
Director” shall have the meaning set forth in Section 3.l.24(p).


 


“Individual
Loan-to-Value Ratio” shall mean, with respect to an Individual Property, as
of any date of determination, a ratio (as reasonably determined by Lender), (x) the
numerator of which is equal to the Allocated Loan Amount for such individual
Property, and (y) the denominator of which is equal to the “as-is” fair
market value of such Individual Property, determined with respect to the
Closing Date by the Appraisals delivered to Lender on or prior to the date
hereof, and with respect to future dates, on the basis of Lender’s reasonable
determination of the fair market value of such individual Property, or, if Borrower disputes Lender’s
valuation or otherwise elects to deliver an Appraisal, on the basis of an
Appraisal commissioned by the Lender and at Borrower’s expense.


 


“Individual
Property” shall mean the parcel of real property located at each address
listed on Schedule VI other than any Release Property or Expansion
Parcel released pursuant to Section 2.4, 2.5 or 11.30,
the Improvements thereon and all personal property owned by Borrower and
encumbered by a Mortgage, together with all of Borrower’s rights pertaining to
such property and Improvements, all as more particularly described in the
Granting Clauses of the applicable Mortgage.


 


“Insolvency
Opinion” shall mean that certain bankruptcy nonconsolidation opinion letter
dated the date hereof delivered by Arnall Golden Gregory LLP in connection with
the Loan.


 


“Insurance
Funds” shall have the meaning set forth in Section 6.3.1.


 


“Insurance
Premiums” shall have the meaning set forth in Section 5.1.1 (b).


 


“Interest
Period” shall mean, with respect to any Monthly Payment Date, the period
commencing on the eleventh (11th) day of the preceding calendar month and
terminating on the tenth (10th) day of the calendar month in which such Monthly Payment Date occurs;
provided that the initial interest Period shall begin on the Closing Date and
shall end on the immediately following tenth (10th) day of a calendar month.


 


“Investment
Grade Rating” shall mean a long-term unsecured debt rating of at least “BBB-”
(or the equivalent) by S&P, Fitch and Moody’s.


 


“Lease”
shall mean any lease, sublease or subsublease, letting, license, concession or
other agreement (whether written or oral and whether now or hereafter in
effect) pursuant to which any Person is granted a possessory interest in, or
right to use or occupy all or any portion of any space in any Individual
Property, and every modification, amendment or other agreement relating to such
lease, sublease, subsublease, or other agreement entered into in connection
with such lease, sublease, subsublease, or other agreement and every guarantee
of the performance 


 


10

















 


and observance of the covenants, conditions and agreements to be
performed and observed by the other party thereto.  As used herein and in the other Loan
Documents, the term “Lease” shall be deemed to include any Warehouse
Agreements.


 


“Legal
Requirements” shall mean all federal, state, county, municipal and other
governmental statutes, laws, rules, orders, regulations, ordinances, judgments,
decrees and injunctions of Governmental Authorities affecting Borrower, Manager
or any Individual Property or any part thereof or the construction, use,
alteration or operation thereof, or any part thereof, whether now or hereafter
enacted and in force, including, without limitation, the Americans with
Disabilities Act of 1990, and all permits, licenses and authorizations and
regulations relating thereto, and all covenants, agreements, restrictions and
encumbrances contained in any instruments, either of record or known to
Borrower, at any time in force affecting the Borrower or any Individual
Property or any part thereof, including, without limitation, any which may (i) require
repairs, modifications or alterations in or to any Individual Property or any
part thereof, or (ii) in any way limit the use and enjoyment thereof.


 


“Lender”
shall mean UBS Real Estate Securities Inc., a Delaware corporation, together
with its successors, assigns, and, subject to and for the purposes set forth in
Section 11.27, Participants.


 


“Lender
Group” shall have the meaning set forth in Section 9.2(b).


 


“Lender
Indemnitees” shall have the meaning set forth in Section 11.13(b).


 


“Letter
of Credit” shall mean an irrevocable, unconditional, transferable, clean
sight draft letter of credit acceptable to Lender and the Rating Agencies in
favor of Lender and entitling Lender to draw thereon in New York, New York,
issued by a domestic Eligible Institution or the U.S. agency or branch of a
foreign Eligible Institution.  The Letter
of Credit shall have a term of at least one (1) year (or such shorter
period of time necessary for such Letter of Credit to have a term which does
not expire until at least thirty (30) days after the Maturity Date); provided,
however, that any such Letter of Credit which is in effect upon the Maturity
Date shall not expire until at least thirty (30) days after the Maturity
Date.  If Borrower has not provided
Lender with a new Letter of Credit at least ten (10) Business Days prior
to the expiration of any Letter of Credit, then Lender shall have the right to
immediately draw down the same in fall and hold the proceeds of such draw as
cash security in accordance with the applicable provisions hereof.  If at any time the bank issuing any such
Letter of Credit shall cease to be an Eligible Institution and Borrower does
not replace such Letter of Credit with a Letter of Credit issued by an
institution that is an Eligible Institution prior to the earlier to occur of (i) five
(5) days after Borrower has
knowledge of such event or (ii) five (5) days after Lender has provided Borrower with notice thereof,
then Lender shall have the right immediately to draw down the same in full and
hold the proceeds of such draw in accordance with the applicable provisions
hereof.


 


“Liabilities”
shall have the meaning set forth in Section 9.2(b).


 


“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 the


 


11














 


Property
or any portion thereof or Borrower, or any interest therein,
including, without limitation, any conditional sale or other title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing, the filing of any financing statement, and mechanic’s,
materialmen’ s and other similar liens and encumbrances.


 


“Loan” shall mean the
loan in the original principal amount of One Hundred Nineteen Million Five
Hundred Thousand and No/100 Dollars ($119,500,000.00) made by Lender to
Borrower pursuant to this Agreement.


 


“Loan Documents”
shall mean, collectively, this Agreement, the Note, the Mortgage, the
Assignment of Leases, the Cash Management Agreement, the Environmental
Indemnity, the Guaranty, the Assignment of Management Agreement, the Security
Agreement, the Cross Guaranty and any other document pertaining to the Property
as well as all other documents now or hereafter executed and/or delivered in
connection with the Loan, as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time.


 


“Loan-to-Value Ratio”
shall mean, as of any date of determination, a ratio (as reasonably determined
by Lender), (x) the numerator of which is equal to (i) the
outstanding principal balance of the Loan, and (y) the denominator of
which is equal to the “as-is” fair market value of the Property, determined on
the basis of Lenders reasonable determination of the fair market value of the
Property, or, if Borrower disputes Lender’s valuation, on the basis of an
Appraisal commissioned by the Lender and at Borrower’s expense.


 


“Logistics” shall
mean AmeriCold Logistics LLC, a Delaware limited liability company, and its
permitted successors by merger, consolidation or transfer of all or
substantially all of the assets of AmeriCold Logistics LLC, subject to any
terms, covenants and/or conditions of this Agreement.


 


“Major Customer List”
shall mean a list of those customers each of which, pursuant to one or more
Leases or Service Contracts for space at one or more of the Individual
Properties, is required to make aggregate annual payments to the Borrowers of
not less than $4,000,000.  The Major
Customer List as of the date hereof is attached hereto as Schedule I.


 


“Major Lease” shall
mean any Lease covering all or substantially all of the Property.


 


“Major Tenant” shall
mean (i) any Tenant occupying all or substantially all of any Individual
Property pursuant to a Lease (other than any month-to-month Lease) and (ii) any
Tenant under any Lease listed on Schedule VIII.


 


“Management Agreement”
shall mean (a) that certain Management Agreement, dated as of the date
hereof, between Propco Borrower and Manager, as the same may be amended or
otherwise modified from time to time in accordance with the terms of this
Agreement, or (b) if the context requires, a replacement management
agreement entered into by and between Borrower and a Qualified Manager in
accordance with the terms of this Agreement.


 


12

















 


“Manager” shall mean (a) ART
Manager L.L.C. or (b) if the context requires, any other Qualified Manager
which becomes manager of the Property in accordance with the terms of this
Agreement.


 


“Material Adverse Effect”
shall mean any event or condition that has a material and adverse effect, in
each case, taken as a whole on (a) the business operations, economic
performance, assets, financial condition, equity, contingent liabilities,
prospects, material agreements or results of operations of Borrower, Guarantor
or the Property, (b) the ability of Borrower or Guarantor to perform, in
all material respects, its respective obligations under the Loan Documents, (c) the
enforceability or validity of any Loan Document, the perfection or priority of
any Lien created under any Loan Document or the remedies of Lender under any
Loan Document, (d) the value of, or cash flow (other than cash flow from
transportation operations conducted or performed by Borrower or any of its
Affiliates from or with respect to any one or more Individual Properties) from,
the Property or the operations thereof or (e) the value of the Loan.


 


“Material Agreements”
means each contract and agreement relating to the ownership, management,
development, use, operation, leasing, maintenance, repair or improvement of any
one (1) or more Individual Properties, other than the Management Agreement
and the Leases, under which there is an obligation of Borrower to pay more than
One Million and No/100 Dollars ($1,000,000.00) per annum.


 


“Maturity Date” shall
mean December 11, 2016 or such other date on which the final payment of
principal of the Note becomes due and payable as therein or herein provided,
whether at such stated maturity date, by declaration of acceleration, or
otherwise.


 


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


 


“Minimum Disbursement
Amount” shall mean Twenty-Five Thousand and No/100 Dollars ($25,000).


 


“Monthly Debt Service Payment
Amount” shall mean, with respect to any Monthly Payment Date, the interest
amount determined in accordance with Section 2.2.2 of this
Agreement.


 


“Monthly Payment Date”
shall mean the eleventh (11th) calendar day of each calendar month during the term of the Loan, and
if such day is not a Business Day, then the Business Day immediately preceding
Business Day, commencing on January 11, 2007, and continuing to and
including the Maturity Date.


 


“Moody’s”
shall mean Moody’s Investors Service, Inc.


 


“Mortgage” shall
mean, with respect to each Individual Property, that certain first priority
Mortgage, Deed of Trust or Deed to Secure Debt, dated as of the date hereof,
executed 


 


13

















 


and
delivered by Propco Borrower and encumbering the applicable Individual
Property, as the same may be amended, restated, replaced, supplemented or
otherwise modified from time to time.


 


“Net Proceeds” shall
mean: (i) the net amount of all insurance proceeds payable as a result of
a Casualty to any Individual Property, after deduction of reasonable costs and
expenses (including, but not limited to, reasonable attorneys’ fees), if any,
in collecting such insurance proceeds, or (ii) the net amount of the
Award, after deduction of reasonable costs and expenses (including, but not
limited to, reasonable attorneys’ fees), if any, in collecting such Award.


 


“Net Proceeds Deficiency”
shall have the meaning set forth in Section 5.12(f).


 


“Note” shall mean
that certain Promissory Note dated as of the date hereof made by Borrower in
the original principal amount of One Hundred Nineteen Million Five Hundred
Thousand and No/100 Dollars ($119,500,000.00), and, if applicable, the Defeased
Note and the Undefeased Note, in each ease as the same may be amended,
restated, replaced, supplemented, increased, extended, consolidated or
otherwise modified from time to time.


 


“Notice” shall have
the meaning set forth in Section 11.6.


 


“Officer’s Certificate”
shall mean a certificate delivered to Lender by Borrower which is signed by an
authorized senior officer of Borrower.


 


“Opco Borrower” shall
mean ART Mortgage Borrower Opco 2006-1B L.P., a Delaware limited partnership,
and its successors by merger, consolidation or transfer of all or substantially
all of the assets of such Person (except to the extent that any such merger,
consolidation or transfer may be prohibited hereunder).


 


“Opco Borrower GP”
shall have the meaning set forth in Section 3.1.24(z).


 


“Operating Agreements”
shall mean any covenants, restrictions or agreements of record relating to the
construction, operation or use of the Property.


 


“Operating Expenses” shall mean all costs and expenses incurred by or on behalf of
Borrower relating to the operation, maintenance and management of the Property,
including, without limitation, utilities, repairs and maintenance, insurance,
property taxes and assessments, advertising expenses, payroll and related
taxes, lease payments (for leases treated as operating leases in accordance
with GAAP), the greater of actual management salaries and other compensation
and related taxes and 2% of annual Gross Revenues and $0.03 per gross cubic
foot of the Improvements per annum with respect to capital costs, but excluding
actual Capital Expenditures, lease payments (for leases treated as capital
leases in accordance with GAAP), depreciation, amortization, obligations to
post security to secure workers’ compensation obligations, deposits required to
be made to the Reserve Funds, sales, use and occupancy or other taxes on receipts
required to be accounted for by the owner or operator of the Property to any
Governmental Authority, interest expense and income tax expense; provided,
however such costs and expenses shall be subject to adjustment by Lender in its
reasonable discretion to normalize such costs and expenses.  Notwithstanding the foregoing, “Operating
Expenses” shall exclude all 


 


14

















 


costs
and expenses incurred in connection with transportation operations conducted or
performed by Borrower or any of its Affiliates from or with respect to any one
or more Individual Properties.


 


“Other Charges” shall
mean all ground rents, maintenance charges, 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 any Individual
Property, now or hereafter levied or assessed or imposed against any Individual
Property or any part thereof.


 


“Otherwise Rated Insurer”
shall have the meaning set forth in Section 5.1.2.


 


“Partial Defeasance
Collateral” shall mean U.S. Obligations which provide payments (i) on
or prior to, but as close as possible to, the Business Day immediately
preceding all Monthly Payment Dates, under the Defeased Note after the
Defeasance Date and up to and including the Monthly Payment Date which Borrower
shall specify occurring concurrently with or after the Permitted Prepayment
Date, and (ii) in amounts equal to or greater than the Scheduled
Defeasance Payments relating to such Monthly Payment Dates.


 


“Partial Defeasance Date”
shall have the meaning set forth in Section 2.5.2(a)(i).


 


“Partial Defeasance Event”
shall have the meaning set forth in Section 2.5.2(a).


 


“Participant” shall
mean any Person that has purchased a participation in this Loan Agreement
pursuant to Section 11.27.


 


“Permitted Encumbrances”
shall mean, collectively, (i) the Liens and security interests created by
the Loan Documents, (ii) all Liens, encumbrances and other matters
disclosed in the Title Insurance Policy, (iii) Liens, if any, for Taxes
imposed by any Governmental Authority not yet due or delinquent, (iv) mechanics’,
materialmen’s or other similar Liens for delinquent Taxes being contested in
good faith if permitted by and in accordance with the terms and provisions of
the Loan Documents and (v) such other title and survey exceptions as
Lender has approved or may approve in writing in Lender’s sole discretion.


 


“Permitted Investments”
shall have the meaning set forth in the Cash Management Agreement.


 


“Permitted Prepayment
Date” shall mean the Monthly Payment Date occurring in August 2016.


 


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


 


“Physical Conditions
Report” shall mean, with respect to each Individual Property, a report
prepared by a company satisfactory to Lender regarding the physical condition
of such Individual Property, satisfactory in form and substance to Lender in
its sole discretion, which report shall, among other things, (i) confirm that
the applicable Individual Property and its 


 


15

















 


use
comply, in all material respects, with
all applicable Legal Requirements (including,
without limitation, zoning, subdivision and building laws) and (ii) include
a copy of a final certificate of occupancy with respect to all Improvements.


 


“Plan Assets Regulation”
shall have the meaning specified in Section 3.1.8.


 


“Policies” shall have
the meaning specified in Section 5.1.1(b).


 


“Prepayment Date”
shall mean the date on which the Loan is prepaid in whole or in part in
accordance with the terms hereof.


 


“Prescribed Laws”
shall mean, collectively, (a) the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001 (Public Law 107-56) (The
U.S.A. PATRIOT Act), (b) Executive Order No. 13224 on Terrorist
Financing, effective September 24, 2001, and relating to Blocking Property
and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or
Support Terrorism, (c) the International Emergency Economic Power Act, 50
U.S.C. § 1701 et seq. and (d) all other Legal Requirements relating to
money laundering or terrorism.


 


“primary Servicer”
shall have the meaning set forth in Section 11.24(d).


 


“Propco Borrower”
shall mean ART Mortgage Borrower Propco 2006-1B L.P., a Delaware limited
partnership, and its successors by merger, consolidation or transfer of all or
substantially all of the assets of such Person (except to the extent that any
such merger, consolidation or transfer may be prohibited hereunder).


 


“Propco Borrower GP”
shall have the meaning set forth in Section 3.1.24(z).


 


“Property” shall
mean, collectively, the Individual Properties.


 


“Public Company”
shall mean a Person whose stock or ownership interests are publicly traded on
the New York Stock Exchange or other nationally recognized stock exchange.


 


“Qualified Appraiser”
means any member of the American Institute of Real Estate Appraisers selected
by Borrower and reasonably acceptable to the Lender.


 


“Qualified Transferee”
shall mean any one of the following Persons:


 


(i)            a corporation, partnership
or limited liability company acceptable to Lender in its sole discretion;


 


(ii)           a pension fund, pension
trust or pension account that immediately prior to such transfer owns, directly
or indirectly, total real estate assets of at least $1,000,000,000;


 


(iii)          a pension fund advisor who (a) immediately
prior to such transfer, controls, directly or indirectly, at least
$1,000,000,000 of real estate assets and (b) is acting on behalf of one or
more pension funds that, in the aggregate, satisfy the requirements of clause (ii) of
this definition;


 


16

















 


(iv)          an insurance company which
is subject to supervision by the insurance commissioner, or a similar official
or agency, of a state or territory of the United States (including the District
of Columbia) (a) with a net worth, determined under GAAP as of a date no
more than six (6) months prior to the date of the transfer of at least
$500,000,000 and (b) who, immediately prior to such transfer, controls,
directly or indirectly, real estate assets of at least $1,000,000,000;


 


(v)           a corporation organized
under the banking laws of the United States or any state or territory of the
United States (including the District of Columbia) (a) with a combined
capital and surplus of at least $500,000,000 and (b) who, immediately
prior to such transfer, controls, directly or indirectly, real estate assets of
at least $1,000,000,000; or


 


(vi)          any Person in which
fifty-one percent (51%) of the ownership interests are owned directly or
indirectly by any of the entities listed in subsections (i) through (v) of
this definition of “Qualified Transferee”, or any combination of more than one
such entity, and which is controlled directly or indirectly by such entity or
entities;


 


provided, in each case,
that such Person (a) qualifies as a bankruptcy remote entity under
criteria established by the Rating Agencies and (b) has delivered to
Lender a non-consolidation opinion reasonably acceptable to Lender and
acceptable the Rating Agencies in their sole discretion.


 


“Qualified Manager”
shall mean (a) ART Manager L.L.C., (b) any other Affiliate of
Borrower, (c) any other Person as to which Borrower shall have obtained a
Rating Agency Confirmation or (d) any Person designated by Lender, provided
that in the case of (a), (b) and (c) Lender has not required
Borrower to replace such Person (or any Affiliate of such Person) as Manager
pursuant to Section 7.3.


 


“Rating Agencies”
shall mean, prior to the final Securitization of the Loan, each of S&P,
Moody’s and Fitch, or any other nationally recognized statistical rating agency
which has been designated by Lender and, after the final Securitization of the
Loan, shall mean any of the foregoing that have rated any of the Securities.


 


“Rating Agency
Confirmation” shall mean a written affirmation from each of the Rating
Agencies that the credit rating of the Securities by such Rating Agency
immediately prior to the occurrence of the event with respect to which such
Rating Agency Confirmation is sought will not be qualified, downgraded or
withdrawn as a result of the occurrence of such event, which affirmation may be
granted or withheld in such Rating Agency’s sole and absolute discretion.


 


“Register” shall have
the meaning set forth in Section 11.27(e).


 


“Registration Statement”
shall have the meaning set forth in Section 9.2(b).


 


“Regulation AB” shall
mean Regulation AB under the Securities Act and the Exchange Act, as such
Regulation may be amended from time to time.


 


“Regulation D” shall
mean Regulation D of the Board of Governors of the Federal Reserve System from
time to time in effect, including any successor or other Regulation 


 


17

















 


or
official interpretation of said Board of Governors relating to reserve
requirements applicable to member banks of the Federal Reserve System.


 


“Related Loan” shall
mean a loan made to an Affiliate of Borrower or secured by a Related Property,
that is included in a Securitization with the Loan.


 


“Related Persons” shall have the meaning set forth in Section 8.1.


 


“Related Property”
shall mean a parcel of real property, together with improvements thereon and
personal property related thereto, that is “related”, within the meaning of the
definition of Significant Obligor, to one or
more individual Properties.


 


“Release Amount”
shall mean, in connection with the release of any Individual Property from the
Lien of the Mortgage (or, in lieu of such release, the assignment of the
Mortgage encumbering any Individual Property), (a) one hundred five
percent (105%) of the Allocated Loan Amount
of the applicable individual Property, which, when taken together with the
Allocated Loan Amount of each Individual Property previously released from the
Lien of the Mortgage (or, with respect to which individual Property, Lender
previously assigned the applicable Mortgage), is less than or equal to the
Tranche I Release Percentage Threshold Amount, (b) one hundred ten percent
(110%) of the Allocated Loan Amount of the applicable Individual Property,
which, when taken together with the Allocated Loan Amount of each Individual
Property previously released from the Lien of the Mortgage (or, with respect to
which Individual Property, Lender previously assigned the applicable Mortgage),
is greater than the Tranche I Release Percentage Threshold Amount and less than
or equal to the Tranche II Release Percentage Threshold Amount, or (c) one
hundred fifteen percent (115%) of the
Allocated Loan Amount of the applicable individual Property, which, when taken
together with the Allocated Loan Amount of each individual Property previously
released from the Lien of the Mortgage (or, with respect to which Individual
Property, Lender previously assigned the applicable Mortgage), equals an amount
which is greater than the Tranche II Release Percentage Threshold Amount;
provided that, in each case, the Release Amount shall not be greater than the
amount of the Debt outstanding on the date the applicable Individual Property
is released from the Lien of the Mortgage (or, in lieu of such release, the
applicable Mortgage is assigned) in accordance with the terms of this Agreement
and the other Loan Documents.


 


“Release Date” shall
mean the earlier to occur of (a) the third anniversary of the Closing Date
and (b) the date that is two (2) years from the “startup day” (within
the meaning of Section 860G(a)(9) of the Code) of the REMIC Trust
established in connection with the last Securitization involving any portion of
this Loan.


 


“Release Property”
shall mean any Individual Property (other than a Substituted Property) with
respect to which the Lien of the related Mortgage has been released (or
assigned) by Lender in accordance with the terms of this Agreement.


 


“REMIC Trust” shall
mean a “real estate mortgage investment conduit” within the meaning of Section 860D
of the Code that holds the Note.


 


“Rents” shall mean
all rents, moneys payable as damages or in lieu of rent, revenues, deposits
(including, without limitation, security, utility and other deposits),
accounts, 


 


18

















 


cash,
issues, profits, charges for services rendered, and other consideration of
whatever form or nature received by or paid to or for the account of or benefit
of Borrower, Manager or any of their agents or employees from any and all
sources arising from or attributable to the Property.  Notwithstanding the foregoing, “Rents” shall
exclude all receipts, revenues and other income generated from transportation
operations conducted or performed by Borrower or any of its Affiliates from or
with respect to any one or more Individual Properties.


 


“Required Repair Funds”
shall have the meaning set forth in Section 6.1.1.


 


“Required Repairs”
shall have the meaning set forth in Section 6.1.1.


 


“Reserve Funds” shall
mean, collectively, the Capital Expenditure Funds, the Insurance Funds, the
Required Repair Funds, if any, the Tax Funds and the Borrower Cash Collateral
Funds.


 


“Reserve Guaranty”
shall have the meaning set forth in Section 6.12(a).


 


“Resizing Event”
shall have the meaning set forth in Section 9.1(c).


 


“Restoration” shall
have the meaning set forth in Section 5.2.1.


 


“Restoration Threshold”
shall mean, with respect to each Individual Property, five percent (5%) of the
Allocated Loan Amount for each such Individual Property.


 


“S&P” shall mean
Standard & Poor’s Ratings Services, a division of the McGraw-Hill
Companies, Inc.


 


“Scheduled Defeasance
Payments” shall mean scheduled payments of interest and principal under the
Note in the case of a Total Defeasance Event and under the Defeased Note in the
case of a Partial Defeasance Event for all Monthly Payment Dates occurring
after the Defeasance Date and up to and including the Monthly Payment Date
referred to in clause (i) of the definition of Partial Defeasance
Collateral or Total Defeasance Collateral, as applicable (including, in the
case of a total defeasance, the outstanding principal balance on the Note as of
such Monthly Payment Date and, in the case of a partial defeasance, the
outstanding principal balance on the Defeased Note as of such Monthly Payment
Date).


 


“Secondary Market
Transaction” shall have the meaning set forth in Section 9.1(a).


 


“Securities” shall
have the meaning set forth in Section 9.1(a).


 


“Securities Act”
shall have the meaning set forth in Section 9.2(a).


 


“Securitization”
shall have the meaning set forth in Section 9.1(a).


 


“Security Agreement”
shall mean that certain Security Agreement, dated as of the date hereof, made
by Borrower in favor of Lender and Cross Lender, as the same may be amended,
restated, replaced, supplemented or otherwise modified from time to time.


 


19

















 


“Service Contract”
shall have the meaning set forth in Section 5.3.2(i).


 


“Servicer” shall have
the meaning set forth in Section 11.24.


 


“Servicing Agreement”
shall have the meaning set forth in Section 11.24.


 


“Severed Loan Documents”
shall have the meaning set forth in Section 10.2(c).


 


“Significant Obligor”
shall have the meaning set forth in Item 1101(k) of Regulation AB under
the Securities Act.


 


“SPC Party” shall
have the meaning set forth in Section 3.1.24(o).


 


“State” shall mean,
with respect to any Individual Property, the State or Commonwealth in which
such Individual Property or any part thereof is located.


 


“Substitute Allocated
Loan Amount” shall have the meaning set forth in Section 11.29.


 


“Substitute Property”
and “Substitute Properties” shall have the respective meanings set forth
in Section 11.29.


 


“Substituted Property”
shall have the meaning set forth in Section 11.29.


 


“Successor Borrower”
shall have the meaning set forth in Section 2.5.4.


 


“Survey” shall mean,
with respect to each Individual Property, a survey of such Individual Property
prepared by a surveyor licensed in the State and satisfactory to Lender and the
company or companies issuing the Title Insurance Policy, and containing a
certification of such surveyor satisfactory to Lender.


 


“Tax Funds” shall
have the meaning set forth in Section 6.2.1.


 


“Taxes” shall mean
all real estate and personal property taxes, assessments, water rates or sewer
rents, now or hereafter levied or assessed or imposed against any Individual
Property or part thereof, together with all interest and penalties thereon.


 


“Tenant” shall mean
any Person obligated by contract or otherwise to pay monies (including a
percentage of gross income, revenue or profits) under any Lease now or
hereafter affecting all or any part of any Individual Property.


 


“Title Insurance Policy”
shall mean, with respect to each Individual Property, an ALTA mortgagee title
insurance policy in the form acceptable to Lender issued with respect to such
Individual Property and insuring the lien of the Mortgage encumbering such
Individual Property.


 


“Total Defeasance
Collateral” shall mean U.S. Obligations, which provide payments (i) on
or prior to, but as close as possible to, the Business Day immediately
preceding all Monthly Payment Dates under the Note after the Defeasance Date
and up to and including the 


 


20

















 


Monthly
Payment Date which Borrower shall specify occurring concurrently with or after
the Permitted Prepayment Date, and (ii) in amounts equal to or greater
than the Scheduled Defeasance Payments relating to such Monthly Payment Dates.


 


“Total Defeasance Date”
shall have the meaning set forth in Section 2.5.1(a).


 


“Total Defeasance Event”
shall have the meaning set forth in Section 2.5.1(a).


 


“Tranche I Release
Percentage Threshold Amount” shall mean the product of the original
principal amount of the Loan and twelve and one-half percent (12.5%).


 


“Tranche II Release
Percentage Threshold Amount” shall mean the product of the original
principal amount of the Loan and twenty-five percent (25%).


 


“Transfer” shall have
the meaning set forth in the Mortgage.


 


“Transferee” shall
mean a Person to whom a Transfer is being effected.


 


“Treasury Rate” shall
mean, as of the Business Day immediately prior to the Prepayment Date, the
yield, calculated by Lender by linear interpolation (rounded to the nearest
one-thousandth of one percent (i.e., 0.001%) of the yields of
non-inflation adjusted noncallable United States Treasury obligations with
terms (one longer and one shorter) most nearly approximating the period from
such date of determination to the Permitted Prepayment Date, as determined by
Lender on the basis of Federal Reserve Statistical Release H.15-Selected
Interest Rates under the heading U.S. Governmental Security/Treasury Constant
Maturities, or another recognized source of financial market information
selected by Lender.  Lender’s
determination of the Treasury Rate shall be final absent manifest error.


 


“TRIA” shall mean the
Terrorism Risk Insurance Act of 2002, as heretofore amended and as the same may
be further amended or otherwise modified; provided that it provides
substantially the same benefits to insurance companies and insureds as are
provided by TRIA as in effect on the Closing Date.


 


“Trigger Event” shall
mean, on the relevant date, the fact that the annual Underwritable Cash Flow
for the Property determined by Lender as of the end of each fiscal quarter
(based on Borrower’s Fiscal Year) on a trailing four (4) quarter basis is
less than the Trigger UCF Amount.


 


“Trigger Period”
shall mean a period commencing on the first (1st) Business Day after a Trigger Event has occurred to
the first (1st) Business Day
after the related Trigger Event has not existed for a period of two (2) consecutive
fiscal quarters.


 


“Trigger UCF Amount”
shall mean, as of any date, an amount equal to the aggregate of the Allocated
UCF Trigger Amounts of all the Individual Properties less the Allocated UCF
Trigger Amount of each Individual Property previously released from the lien of
the Mortgage (or, in lieu of such release, which Mortgage was assigned by
Lender) pursuant to Section 2.4 or Section 2.5.


 


21














 


“Trustee” shall mean
any trustee holding the Loan in a Securitization.


 


“UCC” or “Uniform
Commercial Code” shall mean the Uniform Commercial Code as in effect in the
State.


 


“Underwritable Cash Flow”
shall mean the excess of Gross Revenue over Operating Expenses.


 


“Underwriter Group”
shall have the meaning set forth in Section 9.2(b).


 


“Updated Information”
shall have the meaning set forth in Section 9.1(b)(i).


 


“U.S. Obligations”
shall mean (i) direct full faith and credit obligations of
the United States of America and (ii) other “government securities” within
the meaning of section 1.860G-2(a)(8)(i) of the Treasury Regulations that
are acceptable to the Rating Agencies and in each case that are not subject to
prepayment, call or early redemption.


 


“VNO” shall mean
Vornado Realty Trust, a Maryland real estate investment trust, and its
permitted successors by merger, consolidation or transfer of all or
substantially all of the assets of VNO, subject to any terms, covenants
and/or conditions of this Agreement.


 


“VRLP” shall mean
Vornado Realty L.P., a Delaware limited partnership, and its permitted
successors by merger, consolidation or transfer of all or substantially all of
the assets of VRLP, subject to any terms, covenants and/or conditions of this
Agreement.


 


“Warehouse Agreements”
shall mean warehousing agreements, logistics and services agreements,
distribution agreements, handling agreements and other similar agreements in
connection with the use of one or more Individual Properties as a dry and/or
cold storage warehousing facility and for such other uses as may be necessary
or incidental to such use (including, without limitation, the provision of
distribution services), in each case, to the extent (but only to the extent)
the same are for goods stored or services rendered at an Individual Property
(excluding transportation services), together with any and all amendments and
modifications to such agreements.


 


“YAA” shall mean
Yucaipa American Alliance Fund I, LP, a Delaware limited partnership, and its permitted
successors by merger, consolidation or transfer of all or substantially all of
the assets of YAA, subject to any terms, covenants and/or conditions of this
Agreement.


 


“YAP” shall mean
Yucaipa American Alliance (Parallel) Fund I, LP, a Delaware limited
partnership, and its permitted successors by merger, consolidation or transfer
of all or substantially all of the assets of YAP, subject to any terms,
covenants and/or conditions of this Agreement.


 


“YCI” shall mean
Yucaipa Corporate initiatives Fund I, LP, a Delaware limited partnership, and
its permitted successors by merger, consolidation or transfer of all or
substantially all of the assets of YCI, subject to any terms, covenants and/or
conditions of this Agreement.


 


22

















 


“Yield Maintenance
Premium” shall mean an amount equal to the greater of: (a) one percent
(1%) of the principal amount of the Loan being prepaid or (b) the present
value as of the Prepayment Date of the Calculated Payments from the Prepayment
Date through the Permitted Prepayment Date determined by discounting such
payments at the Discount Rate.  As used
in this definition, the term “Calculated Payments” shall mean the
monthly payments of interest only which would be due based on the principal
amount of the Loan being prepaid on the Prepayment Date and assuming an
interest rate per annum equal to the difference (if such difference is greater
than zero) between (i) the Applicable Interest Rate and (ii) the
Yield Maintenance Treasury Rate.  As used
in this definition, the term “Discount Rate” shall mean the rate which,
when compounded monthly, is equivalent to the Yield Maintenance Treasury Rate,
when compounded semi-annually.  As used
in this definition, the term “Yield Maintenance Treasury Rate” shall
mean the yield calculated by Lender by the linear interpolation of the yields,
as reported in the Federal Reserve Statistical Release H.15-Selected Interest
Rates under the heading U.S. Government Securities/Treasury Constant Maturities
for the week ending prior to the Prepayment Date, of U.S. Treasury Constant
Maturities with maturity dates (one longer or one shorter) most nearly
approximating the Permitted Prepayment Date. 
In the event Release H.15 is no longer published, Lender shall select a
comparable publication to determine the Yield Maintenance Treasury Rate.  In no event, however, shall Lender be
required to reinvest any prepayment proceeds in U.S. Treasury obligations or
otherwise.


 


Section 1.2            Principles
of Construction.  All references to sections and schedules
are to sections and schedules in or to this Agreement unless otherwise
specified.  Unless otherwise specified,
the words “hereof,” “herein” and “hereunder” and words of similar import when
used in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. 
Unless otherwise specified, all meanings attributed to defined terms
herein shall be equally applicable to both the singular and plural forms of the
terms so defined.


 


II.            THE LOAN


 


Section 2.1            The Loan.


 


2.1.1       Agreement to Lend and Borrow.  Subject to and upon the terms and conditions set
forth herein, Lender shall make the Loan to Borrower and Borrower shall accept
the Loan from Lender on the Closing Date.


 


2.1.2       Single Disbursement to Borrower.  Borrower shall receive only one borrowing hereunder in
respect of the Loan and any amount borrowed and repaid hereunder in respect of
the Loan may not be reborrowed.


 


2.1.3       The Note.  The Loan shall be evidenced by the Note and shall be
repaid in accordance with the terms of this Agreement and the Note.


 


2.1.4       Use of Proceeds.  Borrower shall use proceeds of the Loan to (i) pay
and discharge any existing loans relating to the Property, (ii) pay all
past due Basic Carrying Costs, if any, in respect of the Property, (iii) deposit
the Reserve Funds (to the extent required hereunder and not previously
deposited), (iv) pay costs and expenses incurred in connection with the 


 


23

















 


closing of the Loan, (v) fund
any working capital requirements of the Property, (vi) distribute to its
parent entities and (vii) retain and/or distribute the balance, if any.


 


Section 2.2            Interest Rate.


 


2.2.1       Applicable Interest Rate. 
Except as
herein provided with respect to interest accruing at the Default Rate, interest
on the principal balance of the Loan outstanding from time to time shall accrue
from the Closing Date up to, but excluding, the Maturity Date at the Applicable
Interest Rate.


 


2.2.2       Interest Calculation. 
Interest
on the outstanding principal balance of the Loan shall be calculated by
multiplying (a) the actual number of days elapsed in the period for which
the calculation is being made by (b) a daily rate based on a three hundred
sixty (360) day year (that is, the Applicable Interest Rate or the Default
Rate, as then applicable, expressed as an annual rate divided by 360) by (c) the
outstanding principal balance. 
Notwithstanding the foregoing, prior to a Securitization of the
Loan.  Lender shall have the right to
adjust the Interest Period; provided that, after giving effect to such
adjustment, Borrower shall not be obligated hereunder or under any other Loan
Document to pay interest on any prepaid or repaid principal of the Loan for any
period from and after the Monthly Payment Date concurrent with or subsequent to
such prepayment or repayment.  If
requested by Lender, Borrower shall promptly execute an amendment to this
Agreement and any other Loan Documents to evidence such change.


 


2.2.3       Intentionally Omitted.


 


2.2.4       Usury Savings. 
This
Agreement and the other Loan Documents are subject to the express condition
that at no time shall Borrower be required to pay interest on the principal
balance of the Loan at a rate which could
subject Lender to either
civil or criminal.  liability as a result
of being in excess of the Maximum Legal Rate. 
If by the terms of this Agreement or the other Loan Documents, Borrower
is at any time required or obligated to pay interest on the principal balance
due hereunder at a rate in excess of the Maximum Legal Rate, the Applicable
Interest Rate or the Default Rate, as the case may be, shall be deemed to be
immediately reduced to the Maximum Legal Rate and all previous payments in
excess of the Maximum Legal Rate shall be deemed to have been payments in
reduction of principal and not on account of the interest due hereunder.  All sums paid or agreed to be paid to Lender
for the use, forbearance, or detention of the sums due under the Loan, shall,
to the extent permitted by applicable law, be amortized, prorated, allocated,
and spread throughout the full stated term of the Loan until payment in full so
that the rate or amount of interest on account of the Loan does not exceed the
Maximum Legal Rate from time to time in effect and applicable to the Loan for
so long as the Loan is outstanding.


 


Section 2.3            Loan Payments.


 


2.3.1       Payment Before Maturity Date. 
Borrower
shall make a payment to Lender of interest only on the Closing Date for the
initial Interest Period.  Borrower shall
make a payment to Lender of interest only in the amount of the Monthly Debt
Service Payment Amount on the Monthly Payment Date occurring in January 2007
and on each Monthly Payment Date 


 


24

















 


hereafter to and
including the Maturity Date.  Each
payment shall be applied first to accrued and unpaid interest and the balance
to principal.


 


2.3.2       Payment on Maturity Date. 
Borrower
shall pay to Lender on the Maturity Date the outstanding principal balance of
the Loan, all accrued and unpaid interest and all other amounts due hereunder
and under the Note, the Mortgage and the other Loan Documents.


 


2.3.3       Interest Rate and Payment after Default. 
In the
event that, and for so long as, any Event of Default shall have occurred and be
continuing, the outstanding principal balance of the Loan shall accrue interest
at the Default Rate, calculated from the date the Event of Default
occurred.  If all or any part of the
principal amount of the Loan is prepaid upon acceleration of the Loan following
the occurrence of an Event of Default, Borrower shall be required to pay
Lender, in addition to all other amounts then payable hereunder (including,
without limitation, (i) in the event that such prepayment is received on a
Monthly Payment Date, interest which has accrued on such amount through such
Monthly Payment Date, or (ii) in the event that such prepayment is
received on a date other than a Monthly Payment Date, interest which would have
accrued on such amount through the last day of the Interest Period during which
such prepayment occurs).


 


2.3.4       Late Payment Charge. 
If any
principal, interest or any other sum due under the Loan Documents, other than
the payment of principal due on the Maturity Date, is not paid by Borrower on
the date on which it is due such that the same would constitute an Event of
Default hereunder, Borrower shall pay to Lender upon demand an amount equal to
the lesser of five percent (5%) of such unpaid sum or the maximum amount
permitted by applicable law in order to defray the expense incurred by Lender
in handling and processing such delinquent payment and to compensate Lender for
the loss of the use of such delinquent payment. 
Any such amount shall be secured by the Mortgage and the other Loan
Documents.


 


2.3.5       Method and Place of Payment. 
(a) Except
as otherwise specifically provided herein, all payments and prepayments under
this Agreement and the Note shall be made to Lender not later than 1:00 P.M.,
New York City time, on the date when due and shall be made in lawful money of
the United States of America in  immediately
available funds at Lender’s office, and any funds received by Lender after such
time shall, for all purposes hereof, be deemed to have been paid on the next
succeeding Business Day.  Notwithstanding
the foregoing, amounts due for the payment of Debt Service under the Loan
Documents shall be deemed paid so long as there are sufficient sums on deposit
in the Deposit Account (as defined in the Cash Management Agreement) for payment
of such amounts and Lender’s access to such funds has not been inhibited or
prevented in any manner whatsoever due to circumstances or events which are
directly or indirectly caused by or otherwise relate to any actions or
omissions of Borrower or any of its Affiliates.


 


(b)           Whenever any payment to be made hereunder or under any
other Loan Document shall be stated to be due on a day which is not a Business
Day, the due date thereof shall be the Business Day immediately preceding such
day.


 


25

















 


(c)           All payments required to be made by Borrower hereunder
or under the Note or the other Loan Documents shall be made irrespective of,
and without deduction for, any setoff, claim or counterclaim (other than a
compulsory counterclaim), and any payment required under the Note and the other
Loan Documents shall be made irrespective of any defense thereto.


 


Section 2.4            Prepayments.


 


2.4.1       Voluntary Prepayments. 
(a) On
and after the Permitted Prepayment Date, Borrower may, at its option, prepay
the Debt in whole but not in part on any Business Day, without payment of any
Yield Maintenance Premium, provided, the following conditions are satisfied:


 


(i)            Borrower shall provide prior written
notice to Lender specifying the date upon which the prepayment is to be made,
which notice shall be delivered to Lender not less than ten (10) Business
Days prior to such Prepayment Date (or such shorter period of time as may be
permitted by Lender in its sole discretion). 
Borrower’s notice of prepayment shall create an obligation of Borrower
to prepay the Loan or a portion thereof as set forth therein, but may be
rescinded by a written notice to Lender prior to the applicable Prepayment
Date.  Borrower agrees to indemnify
Lender and to hold Lender harmless from and against any and all costs and
expenses Lender sustains or incurs as a consequence of any such rescission of a
notice of prepayment; and


 


(ii)           If such prepayment is made on a day other
than a Monthly Payment Date, then in connection with such prepayment Borrower
shall pay to Lender, simultaneously with such prepayment, all interest on the
principal balance of this Note then being prepaid which would have accrued
through the last day of the Interest Period during which such prepayment
occurs.  Any prepayment received by
Lender on a date other than a Monthly Payment Date shall be held by Lender (and
the interest shall accrue for the benefit of Borrower) as collateral security
for the Loan and shall be applied to the Debt on the next Monthly Payment Date.


 


(b)           Upon payment in full of all principal and interest due
on the Loan and all other amounts due and payable under the Note and the other
Loan Documents in accordance with the terms and provisions of the Loan
Documents, upon the written request of Borrower, Lender shall (i) release
the Lien of the Mortgages and all other security interests granted herein and
under the other Loan Documents pursuant to an instrument or other document in
form and substance reasonably satisfactory to Lender or (ii)(A) assign, or
sever into two (2) or more separate loans and assign, the Mortgages and
the other Loan Documents to any Person designated by Borrower, which assignment
and severance documents shall be in recordable form, (B) deliver to or as
directed by Borrower the original executed Note and all originally executed
other notes which may have been consolidated, amended and/or restated in
connection with the execution of the Note or, with respect to any note where
the original has been lost, destroyed or mutilated, a lost note affidavit for
the benefit of the assignee lender and the title insurance company insuring the
Mortgages, as assigned, in form sufficient to permit such title insurance
company to insure the lien of the Mortgages as assigned to and held by the
assignee without exception for any matter relating to the lost, destroyed or
mutilated note; provided that in no event shall Lender be required to
deliver any indemnity with respect thereto, (C) execute and 


 


26

















 


deliver an allonge with
respect to the Note and any other note(s) described in the clause (B) above,
(D) deliver the original recorded copies of the Mortgages in Lender’s
possession or, at Borrower’s sole cost and expense, certified copies of record,
and (E) execute and deliver such other instruments of conveyance,
assignment, termination, severance and release (including appropriate UCC
statements) in recordable form as may reasonably be requested by Borrower to
evidence such assignment and/or severance, provided, in each case, without
covenant, recourse, representation (other than representations that such
assignment has been duly authorized and that Lender has not otherwise assigned
or encumbered the Mortgages or the other Loan Documents except as expressly
contemplated therein) or warranty by Lender and notwithstanding anything to the
contrary contained herein, pursuant to instruments or other documents in form
and substance reasonably satisfactory to Lender.  Concurrently with the payment to Lender of
all principal and interest on, and all other amounts due and payable under the
Note and the other Loan Documents, and whether or not Borrower shall request a
release or an assignment as set forth in this Section 2.4.1(b), Lender
shall deliver to Borrower (1) a payoff letter in customary form, (2) all
original insurance policies relating to the Property held by or on behalf of
Lender, (3) any amounts held in escrow or in any reserve account pursuant
to the Loan Documents or otherwise, (4) any other collateral that may have
been delivered to Lender in connection with the Loan, and (5) a
termination (subject to customary “clawback” provisions) of any guaranties
delivered to Lender in connection with the Loan (except to the extent of any
obligations thereunder that are expressly intended to survive pursuant to the
terms thereof), duly executed by Lender, in each case with respect to clause (1) or
(5), in form and substance reasonably satisfactory to Lender.  In connection with any transaction contemplated
by this Section 2.4.1(b), Borrower shall submit to Lender for its
review, not less than ten (10) Business Days prior to the date of any
release or assignment of the Mortgages or the payment in lull of the Debt (or
such shorter period of time as may be permitted by Lender in its sole
discretion), all instruments and documents to be executed by Lender (other than
a payoff letter under clause (1) above). 
All reasonable out-of-pocket costs and expenses incurred by Lender
pursuant to this Section 2.4.1(b) shall be paid by Borrower
(other than any costs and expenses incurred by Lender in connection with the
preparation and delivery of a lost note affidavit in accordance with clause
(ii)(B) above or a payoff letter as contemplated by clause (1) above and
provided that in no event shall Borrower be required to pay any fee or premium
in connection herewith).


 


(c)           Following either the occurrence and during the
continuance of (x) a Default (other than a monetary Default) for which
Lender has given written notice to Borrower or (y) an Event of Default
which, in either case, cannot be cured despite Borrower’s commercially
reasonable efforts (but which Default or Event of Default would be cured or
eliminated by the release of any Individual Property (or, in lieu of such
release, an assignment of the Mortgage encumbering such Individual Property)),
Borrower shall have the right, prior to the Release Date, to prepay a portion
of the Debt and obtain the release of such Individual Property from the Lien of
the applicable Mortgage (or, in lieu of such release, obtain an assignment of
the Mortgage encumbering such Individual Property), provided the following
conditions are satisfied:


 


(i)            Borrower shall provide prior written
notice to Lender specifying the date upon which the prepayment is to be made,
which notice shall be delivered to Lender not less than ten (10) Business
Days prior to such Prepayment Date (or such shorter period of time as may be
permitted by Lender in its sole discretion). 
Borrower’s notice of 


 


27

















 


prepayment shall create an obligation of Borrower to prepay the Loan or
a portion thereof as set forth therein, but may be rescinded by a written
notice to Lender prior to the applicable Prepayment Date.  Borrower agrees to indemnify Lender and to
hold Lender harmless from and against any and all costs and expenses Lender
sustains or incurs as a consequence of any such rescission of a notice of
prepayment;


 


(ii)           If such prepayment is made on a day other
than a Monthly Payment Date, then in connection with such prepayment Borrower
shall pay to Lender, simultaneously with such prepayment, all interest on the
principal balance of the Note then being prepaid which would have accrued
through the last day of the Interest Period during which such prepayment
occurs.  Any prepayment received by
Lender on a date other than a Monthly Payment Date shall be held by Lender (and
the interest shall accrue for the benefit of and shall be payable to Borrower)
as collateral security for the Loan and shall be applied to the Debt on the
next Monthly Payment Date;


 


(iii)          In
connection with the release of any Individual Property (or the assignment of
the Mortgage encumbering such Individual Property), Lender shall have received (A) payment
of the applicable Release Amount, (B) payment of the Yield Maintenance
Premium with respect to the portion of the Loan to be prepaid and (C) payment
of any other amounts then due and owing to Lender pursuant to this Agreement
and the other Loan Documents;


 


(iv)          Immediately after giving effect to such
prepayment and the release of the applicable Individual Property from the Lien
of the related Mortgage (or, in lieu of such release, the assignment of the
Mortgage encumbering such Individual Property), no Default or Event of Default
shall have occurred and be continuing (excluding any Default or Event of
Default arising from the released Individual Property);


 


(v)           In connection with the release of an
Individual Property pursuant to this Section 24.1(c), Borrower
shall submit to Lender for its review, not less than ten (10) Business
Days prior to the date of such release (or such shorter period of time as may
be permitted by Lender in its sole discretion), a partial release of the
applicable Mortgage and the related Loan Documents to be executed by
Lender.  Such release shall be in a form
appropriate for the jurisdiction in which such Individual Property is located
and otherwise reasonably acceptable to Lender;


 


(vi)          In lieu of a release of an Individual Property
in accordance with clause (v), upon Borrower’s written request not less than
ten (10) Business Days prior to the date of the proposed assignment (or
such shorter period of time as may be permitted by Lender in its sole
discretion), Lender shall (A) sever the Note and assign or endorse over a
severed note in the amount equal to the Release Amount for such Individual
Property and assign the applicable Mortgage to any Person designated by
Borrower, which assignment and severance documents shall be in recordable form,
(B) deliver to or as directed by Borrower the original executed severed
note, (C) deliver the original recorded copy of the applicable Mortgage in
Lender’s possession or, at Borrower’s sole cost and expense, a certified copy
of record, and (D) execute and deliver such other instruments of
conveyance, assignment, termination, severance and release (including
appropriate UCC 


 


28

















 


statements) in recordable form as may reasonably be requested by Borrower
to evidence such assignment and/or severance, provided, in each case, without
covenant, recourse, representation (other than representations that such
assignment has been duly authorized and that Lender has not otherwise assigned
or encumbered the applicable Mortgage except as expressly contemplated therein)
or warranty by Lender and notwithstanding anything to the contrary contained
herein, pursuant to instruments or other documents in form and substance
reasonably satisfactory to Lender. 
Borrower shall provide all other documentation Lender reasonably
requires to be delivered by Borrower in connection with such severance and
assignment (including, without limitation, a severed note in the amount equal
to the principal balance of the Loan after giving effect to such assignment),
together with an Officer’s Certificate certifying that such severance and
assignment will not impair or otherwise adversely affect the Liens, security
interests and other rights of Lender under the Loan Documents not being assigned
(or as to the parties to the Loan Documents and the Individual Properties
subject to the Loan Documents not being assigned).  In connection with any transaction
contemplated by this Section 2.4.1(c)(vi), Borrower shall submit to Lender
for its review, not less than ten (10) Business Days prior to the date of
any assignment of a Mortgage (or such shorter period of time as may be
permitted by Lender in its sole discretion), all instruments and documents to
be executed by Lender;


 


(vii)         Simultaneously
with the release (or assignment), (A) Borrower shall convey its title to
the applicable Individual Property to a Person other than Borrower and (B) Borrower
and Manager shall execute an amendment to the Management Agreement effective as
of such release (or assignment) deleting the applicable Individual Property
from the list of properties managed thereunder;


 


(viii)        Borrower
shall deliver an Officer’s Certificate certifying that the requirements set
forth in this Section 2.4.1(c) have been satisfied; and


 


(ix)           All reasonable out-of-pocket costs and
expenses incurred by Lender pursuant to this Section 2.4.1(c) shall
be paid by Borrower.


 


2.4.2       Mandatory Prepayments. 
(a) On
each date on which Lender actually receives a distribution of Net Proceeds, and
if Lender exercises its right provided for herein not to make such Net Proceeds
available to Borrower for a Restoration, one hundred percent (100%) of such Net
Proceeds shall be applied to the outstanding principal balance of the Loan,
together with interest accruing on such amount calculated through the next
Monthly Payment Date.  Any prepayment
received by Lender pursuant to this Section 2.4.2 on a date other
than a Monthly Payment Date shall be held by Lender as collateral security for
the Loan in an interest bearing account, with such interest accruing to the
benefit of and payable to Borrower, and shall be applied by Lender on the next
Monthly Payment Date.  The Allocated Loan
Amount of an applicable Individual Property shall be reduced by an amount equal
to such prepayment of principal upon such application of Net Proceeds pursuant
to this Section 2.4.2. 
Notwithstanding the foregoing and anything else herein to the contrary,
if in connection with any Casualty or Condemnation at any Individual Property
Lender exercises its right provided for herein not to make the Net Proceeds
available to Borrower for a Restoration, then at Borrower’s option, Lender
shall release the applicable Individual Property from the lien of the Mortgage
and related 


 


29

















 


Loan Documents (or, in
lieu of such release, the assignment of the related Mortgage by Lender on
substantially the same terms as are provided in Section 2.4.1(c)), provided
that (i) Borrower shall pay Lender an amount which, when added to the
amount of Net Proceeds received in connection with such Casualty or
Condemnation, equals the Allocated Loan Amount of the Individual Property for
which the Net Proceeds were obtained together with interest on such amount
calculated for the same periods as Net Proceeds in the first sentence of this Section 2.4.2,
(ii) no Event of Default shall have occurred and be continuing (except
for any Event of Default which would be cured or eliminated by the release or
assignment of the Individual Property, (iii) Borrower shall provide to
Lender a release of the Mortgage as it relates to such Individual Property and
related Loan Documents in a form appropriate for the jurisdiction in which the
applicable Individual Property is located and reasonably satisfactory to Lender
for execution by Lender and (iv) simultaneously with the release, Borrower
shall convey fee simple title to the Release Property to a Person other than
Borrower.


 


(b)           Any prepayment of the Loan pursuant to this Section 2.4.2 shall be
without premium (including Yield Maintenance Premium) or penalty of any kind.


 


2.4.3       Prepayments After Default.  Subject to the terms set forth in Section 2.4.1(c),
if, after an Event of Default, payment of all or any part of the principal of
the Loan is tendered by Borrower, a purchaser at foreclosure or any other
Person, such tender shall be deemed an attempt to circumvent the prohibition
against prepayment set forth in Section 2.4.1 and Borrower, such
purchaser at foreclosure or other Person shall pay, in addition to the
outstanding principal balance, all accrued and unpaid interest and other
amounts payable under the Loan Documents, an amount equal to the applicable
Yield Maintenance Premium, if any.


 


Section 2.5            Defeasanee.


 


2.5.1       Total Defeasanee.  (a)Provided
no Event of Default shall have occurred and remain uncured, Borrower shall have
the right at any time after the Release Date and prior to the Permitted
Prepayment Date to voluntarily defease the entire Loan and obtain a release of the lien of the Mortgage by
providing Lender with the Total Defeasance Collateral (hereinafter, a “Total
Defeasance Event”), subject to the satisfaction of the following conditions
precedent:


 


(i)            Borrower shall provide Lender not less
than fifteen (15) Business Days’ notice (or such shorter period of time as may
be permitted by Lender in its sole discretion) specifying a date (the “Total
Defeasance Date”) on which the Total Defeasance Event is to occur.  Borrower’s notice of defeasance shall create
an obligation of Borrower to defease the entire Loan as set forth therein, but
may be rescinded by a written notice to Lender prior to the applicable Total
Defeasance Date.  Borrower agrees to
indemnify Lender and to hold Lender harmless from and against any and all costs
and expenses Lender sustains or incurs as a consequence of any such rescission
of a notice of defeasance;


 


(ii)           Borrower shall pay to Lender (A) all
payments of principal and interest due on the Loan to and including the Total
Defeasance Date and (B) all other sums, then due under the Note, this
Agreement, the Mortgage and the other Loan Documents;


 


30














 


(iii)          Borrower
shall deposit the Total Defeasance Collateral into the Defeasance Collateral
Account and otherwise comply with the provisions of Sections 2.5.3 and 2.5.4  hereof;


 


(iv)          Borrower shall execute and deliver to
Lender a Defeasance Security Agreement in respect of the Defeasance Collateral
Account and the Total Defeasance Collateral;


 


(v)           Borrower shall deliver to Lender an
opinion of counsel for Borrower that is standard in commercial lending
transactions and subject only to customary qualifications, assumptions and
exceptions opining, among other things, (A) that Lender has a legal and
valid perfected first priority security interest in the Defeasance Collateral
Account and the Total Defeasance Collateral, (B) that, if a Securitization
has occurred, the REMIC Trust formed pursuant to such Securitization will not
fail to maintain its status as a “real estate mortgage investment conduit”
within the meaning of Section 860D of the Code as a result of a Total
Defeasance Event pursuant to this Section 2.5  (assuming a “startup day” (within the
meaning of Section 8600(a)(9) of the Code) that is the earlier of the
actual start-up date and the date specified in clause (a) of the
definition of “Release Date” contained herein), and (C) a
non-consolidation opinion with respect to the Successor Borrower;


 


(vi)          If a Securitization has occurred,
Borrower shall deliver to Lender a Rating Agency Confirmation as to the Total
Defeasance Event;


 


(vii)         Borrower
shall deliver an Officer’s Certificate certifying that the requirements set
forth in this Section 2.5  have been
satisfied;


 


(viii)        Borrower
shall deliver a certificate of a “big four” or other nationally recognized
public accounting firm acceptable to Lender certifying that the Total
Defeasance Collateral will generate monthly amounts equal to or greater than
the Scheduled Defeasance Payments;


 


(ix)           Intentionally omitted;


 


(x)            Borrower shall deliver such other
certificates, opinions, documents and instruments as Lender may reasonably
request; and


 


(xi)           Borrower shall pay all reasonable
out-of-pocket costs and expenses of Lender incurred in connection with the
Total Defeasance Event, including Lender’s reasonable attorneys’ fees and
expenses and Rating Agencies fees and expenses.


 


(b)           If Borrower has elected to defease the entire Note and
the requirements of this Section 2.5  have been
satisfied, the Property shall, be released from the lien of the Mortgage and
the Total Defeasance Collateral pledged pursuant to the Defeasance Security
Agreement shall be the sole source of collateral securing the Note.  In connection with the release of the Lien,
Borrower shall submit to Lender for its review, not less than fifteen (15) days
prior to the Defeasance Date (or such shorter period of time as may be
permitted by Lender in its sole discretion), a release of Lien (and related
Loan Documents) to be executed by Lender. 
Such 


 


31

















 


release shall be in a
form appropriate in the applicable jurisdiction(s) in which the Property
is located and that contains standard provisions protecting the rights of the
releasing lender.  In addition, Borrower
shall provide all other documentation that a reasonably prudent lender
originating commercial loans for securitization similar to the Loan would
require to be delivered by Borrower in connection with such release, together
with an Officer’s Certificate certifying that such documentation (i) is in
compliance with all Legal Requirements, and (ii) will effect such release
in accordance with the terms of this Agreement. 
Borrower shall pay all costs, taxes and expenses associated with the
release of the lien of the Mortgage, including Lender’s reasonable attorneys’
fees.  Except as set forth in Section 2.4
or this Section 2.5, no repayment, prepayment or defeasance of
all or any portion of the Note shall cause, give rise to a right to require, or
otherwise result in, the release of the lien of the Mortgage on the Property.


 


(c)           If Borrower has elected to defease the entire Note and
the requirements of this Section 2.5 have been satisfied, in lieu
of the release of the Property in accordance with Section 2.5.1(b),
upon Borrower’s written request not less than fifteen (15) days prior to the
date of the proposed assignment (or such shorter period of time as may be
permitted by Lender in its sole discretion), Lender shall (i) assign, or
sever into two (2) or more separate loans and assign, the Mortgages and
the other Loan Documents to any Person designated by Borrower, which assignment
and severance documents shall be in recordable form, (ii) deliver to or as
directed by Borrower the original executed Note and all originally executed
other notes which may have been consolidated, amended and/or restated in
connection with the execution of the Note or, with respect to any note where
the original has been lost, destroyed or mutilated, a lost note affidavit for
the benefit of the assignee lender and the title insurance company insuring the
Mortgages, as assigned, in form sufficient to permit such title insurance company
to insure the lien of the Mortgages as assigned to and held by the assignee
without exception for any matter relating to the lost, destroyed or mutilated
note; provided that in no event shall Lender be required to deliver any
indemnity with respect thereto, (iii) execute and deliver an allonge with
respect to the Note and any other note(s) described in the clause (ii) above,
(iv) deliver the original recorded copies of the Mortgages in Lender’s
possession or, at Borrower’s sole cost and expense, certified copies of record,
and (v) execute and deliver such other instruments of conveyance,
assignment, termination, severance and release (including appropriate UCC
statements) in recordable form as may reasonably be requested by Borrower to
evidence such assignment and/or severance, provided, in each case, without
covenant, recourse, representation (other than representations that such
assignment has been duly authorized and that Lender has not otherwise assigned
or encumbered the Mortgages or the other Loan Documents except as expressly
contemplated therein) or warranty by Lender and notwithstanding anything to the
contrary contained herein, pursuant to instruments or other documents in form
and substance reasonably satisfactory to Lender.  Concurrently with the delivery of the Total
Defeasance Collateral to Lender, and whether or not Borrower shall request a
release or an assignment as set forth in this Section 2.5.1, Lender
shall deliver to Borrower (1) a payoff letter in customary form, (2) all
original insurance policies relating to the Property held by or on behalf of
Lender, (3) any amounts held in escrow or in any reserve account pursuant
to the Loan Documents or otherwise, (4) any other collateral that may have
been delivered to Lender in connection with the Loan, and (5) a
termination (subject to customary “clawback” provisions) of any guaranties
delivered to Lender in connection with the Loan (except to the extent of any
obligations thereunder that are expressly intended to survive pursuant to the terms
thereof), duly executed by Lender, in each case with respect to clause (1) or
(5), in form and substance reasonably satisfactory to Lender.  In 


 


32

















 


connection with any
transaction contemplated by this Section 2.5.1(c), Borrower shall
submit to Lender for its review, not less than fifteen (15) days
prior to the Defeasance Date (or such shorter period of time as may be
permitted by Lender in its sole discretion), all instruments and documents to
be executed by Lender (other than a payoff letter under clause (1) above).  All reasonable out-of-pocket costs and
expenses incurred by Lender pursuant to this Section 2.5.1(c) shall be paid by Borrower (other than any
costs and expenses incurred by Lender in connection with the preparation and
delivery of a lost note affidavit in accordance with clause (ii) above or
a payoff letter as contemplated by clause (1) above and provided that in
no event shall Borrower be required to pay any fee or premium to the Lender or
the Servicer in connection herewith).


 


2.5.2       Partial Defeasance.  (a) Provided no Event of Default shall have
occurred and remain uncured, Borrower shall have the right at any time after
the Release Date and prior to Permitted Prepayment Date to voluntarily defease
a portion of the Loan and obtain a release of the lien of the Mortgage as to
any Individual Property by providing Lender with the Partial Defeasance
Collateral (hereinafter, a “Partial Defeasance Event”) upon satisfaction of the
following conditions precedent:


 


(i)            Borrower shall provide Lender not less
than fifteen (15) Business Days notice (or such shorter period of time as may
be permitted by Lender in its sole discretion) specifying a date (the “Partial
Defeasance Date”) on which the Partial Defeasance is to occur.  Borrower’s notice of defeasance shall create
an obligation of Borrower to defease a portion of the Loan as set forth
therein, but may be rescinded by a written notice to Lender prior to the
applicable Partial Defeasance Date.  Borrower
agrees to indemnify Lender and to hold Lender harmless from and against any and
all costs and expenses Lender sustains or incurs as a consequence of any such
rescission of a notice of defeasance;


 


(ii)           Borrower shall pay to Lender (A) all
payments of principal and interest due on the
Loan to and including
the Partial Defeasance Date and (B) all other sums then due under the
Note, this Agreement, the Mortgage and the other Loan Documents;


 


(iii)          Borrower
shall deposit the Partial Defeasance Collateral into the Defeasance Collateral
Account and otherwise comply with the provisions of Sections 2.5.3 and 2.5.4  hereof;


 


(iv)          Borrower shall prepare all necessary
documents to modify this Agreement and to amend and restate the Note and issue
two substitute notes, one note having an aggregate principal balance equal to
Release Amount for the subject Individual Property (collectively, the “Defeased
Note”), and the other note having a principal balance equal to the excess
of (A) the original principal amount of the Loan, over (B) the amount
of the Defeased Note (collectively, the “Undefeased Note”).  The Defeased Note and Undefeased Note shall
have identical terms as the Note except for the principal balance.  The Defeased
Note and the
Undefeased Note shall not be cross defaulted or cross collateralized unless the
Rating Agencies shall require otherwise A Defeased Note may not be the subject
of any further defeasance (but may he prepaid on the same terms as the Note);


 


33

















 


(v)           Borrower shall execute and deliver to
Lender a Defeasance Security Agreement in respect of the Defeasance Collateral
Account and the Partial Defeasance Collateral;


 


(vi)          Borrower shall deliver to Lender an
opinion of counsel for Borrower that is standard in commercial lending
transactions and subject only to customary qualifications, assumptions and
exceptions opining, among other things, (A) that Lender has a legal and
valid perfected first priority security interest in the Defeasance Collateral
Account and the Partial Defeasance Collateral, (B) that, if a
Securitization has occurred, the REMIC Trust formed pursuant to such
Securitization will not fail to maintain its status as a “real estate mortgage
investment conduit” within the meaning of Section 860D of the Code as a
result of the Partial Defeasance Event pursuant to this Section 2.5.2
(assuming a “startup day” (within the meaning of Section 8606(a)(9) of
the Code) that is the earlier of the actual start-up date and the date
specified in clause (a) of the definition of “Release Date” contained
herein), and (C) a non-consolidation opinion with respect to the Successor
Borrower;


 


(vii)         Borrower
shall deliver to Lender a Rating Agency Confirmation as to the Partial
Defeasance Event;


 


(viii)        Borrower
shall deliver to Lender a certificate of a “big four” or other nationally recognized public accounting firm
acceptable to Lender certifying that the Partial Defeasance Collateral will
generate monthly amounts equal to or greater than the Scheduled Defeasance
Payments;


 


(ix)           Borrower shall deliver to Lender an
Officer’s Certificate certifying that the requirements set forth in this Section 2.5.2(a) have been satisfied;


 


(x)            After giving effect to the release of any
Individual Properties (including the amount prepaid in Section 2.5.2(a)(ii) above and including any amount
so paid in excess of 100% of the Allocated Loan Amount for any such Release
Properties), the Debt Service Coverage Ratio for the Loan for the Individual
Properties (excluding the Released Property) shall not be less than the greater
of (i) the Debt Service Coverage Ratio as of the Closing Date for the
Property as of the Closing Date and (ii) the Debt Service Coverage Ratio
for the trailing twelve (12) full calendar months as of the date immediately
preceding the release of the Release Properties for the Property as of such
date; provided that, in order to meet the Debt Service Coverage Ratio Test set
forth in this clause (x), Borrower may defease a portion of the Loan in excess
of the Release Amounts of the affected Individual Properties;


 


(xi)           Borrower shall continue to comply with
the terms and provisions of Section 3.1.24;


 


(xii)          Borrower
shall pay all reasonable out-of-pocket costs. 
and expenses of Lender incurred in connection with the Partial
Defeasance Event, including Lender’s reasonable attorneys’ fees and expenses,
the Rating Agencies’ fees and expenses and any fees assessed by the Servicer in
connection with such Partial Defeasance Event.


 


34

















 


(b)           If Borrower has elected to make a partial defeasance
and the requirements of this Section 2.5 have been satisfied, the
Individual Property shall be released from the lien of the Mortgage.  In connection with the release of the Lien,
Borrower shall submit to Lender for its review, not less than fifteen (15) days
prior to the Partial Defeasance Date (or such shorter period of time as may be
permitted by Lender in its sole discretion), a release of Lien (and related
Loan Documents) to be executed by Lender. 
Such release shall be in a form appropriate in the jurisdiction in which
the Property is located and that contains standard provisions protecting the
rights of the releasing lender.  In
addition, Borrower shall provide all other documentation that a reasonably
prudent lender originating commercial loans for securitization similar to the
Loan would reasonably require to be delivered by Borrower in connection with
such release, together with an Officer’s Certificate certifying that such
documentation (i) is in compliance with all Legal Requirements, and (ii) will
effect such release in accordance with the terms of this Agreement.  Borrower shall pay all taxes and all
reasonable costs and expenses associated with the release of the lien of the
Mortgage, including Lender’s reasonable attorneys’ fees.  Borrower shall cause title to the Individual
Property so released from the lien of the Mortgage to be transferred to and
held by a Person other than Borrower. 
Except as set forth in Section 2.4 or this Section 2.5,
no repayment, prepayment or defeasance of all or any portion of the Note shall
cause, give rise to a right to require, or otherwise result in, the release of
the lien of the Mortgage from the Property or any part thereof.


 


(c)           If Borrower has elected to make a partial defeasance
and the requirements of this Section 2.5 have been satisfied, in
lieu of the release of the Individual Property in accordance with Section 2.5.2(b),
upon Borrower’s written request not less than fifteen (15) days prior to the
date of the proposed assignment (or such shorter period of time as may be
permitted by Lender in its sole discretion), Lender shall (i) sever the
Note and assign or endorse over a severed note in the amount equal to the Release Amount for such Individual
Property and assign the applicable Mortgage to any Person designated by
Borrower, which assignment and severance documents shall be in recordable form,
(ii) deliver to or as directed by Borrower the original executed severed
note, (iii) deliver the original recorded copy of the applicable Mortgage
in Lender’s possession or, at Borrower’s sole cost and expense, a certified
copy of record, and (iv) execute and deliver such other instruments of
conveyance, assignment, termination, severance and release (including
appropriate UCC statements) in recordable form as may reasonably be requested
by Borrower to evidence such assignment and/or severance, provided, in
each case, without covenant, recourse, representation (other than
representations that such assignment has been duly authorized and that Lender
has not otherwise assigned or encumbered the applicable Mortgage except as
expressly contemplated therein) or warranty by Lender and notwithstanding
anything to the contrary contained herein, pursuant to instruments or other
documents in form and substance reasonably satisfactory to Lender. 
In connection with any transaction contemplated by this Section 2.5.2(c),
Borrower shall submit to Lender for its review, not less than fifteen (15) days
prior to the date of any assignment of a Mortgage (or such shorter period of
time as may be permitted by Lender in its sole discretion), all instruments and
documents to be executed by Lender.  In
addition, Borrower shall provide all other documentation Lender reasonably requires
to be delivered by Borrower in connection with such severance and assignment
(including, without limitation, a severed note in the amount equal to the
principal balance of the Loan after giving effect to such assignment), together
with an Officer’s Certificate certifying that such severance and assignment
will not impair or otherwise adversely affect the Liens, security interests and
other rights of Lender under the Loan Documents not being assigned 


 


35

















 


(or as to the parties to
the Loan Documents and the Individual Properties subject to the Loan Documents
not being assigned).  All reasonable
out-of-pocket costs and expenses incurred by Lender pursuant to this Section 2.5.2(c) shall
be paid by Borrower; provided that in no event shall Borrower be required to
pay any fee or premium to the Lender or the Servicer in connection therewith.


 


2.5.3       Defeasance Collateral Account. 
On or
before the date on which Borrower delivers the Total Defeasance Collateral or Partial
Defeasance Collateral, Borrower shall open at any Eligible Institution the
defeasance collateral account (the “Defeasance Collateral Account”)
which shall at all times be an Eligible Account.  The Defeasance Collateral Account shall
contain only (a) Total Defeasance Collateral or the applicable Partial
Defeasance Collateral, and (b) cash
from interest and principal paid on the Total Defeasance Collateral or the
applicable Partial Defeasance Collateral. 
All cash from interest and principal payments paid on the Total
Defeasance Collateral or Partial Defeasance Collateral shall be paid over to
Lender on each Monthly Payment Date and applied first to accrued and unpaid
interest and then to principal. 
Following the- payment of all Scheduled Defeasance Payments, any cash
from interest and principal paid on the Total Defeasance Collateral or Partial
Defeasance Collateral in excess of the amounts necessary to pay the Scheduled
Defeasance Payments shall be paid to Borrower or, if there is a Successor Borrower,
to Successor Borrower.  Borrower shall
cause the Eligible Institution at which the Total Defeasance Collateral or
Partial Defeasance Collateral is deposited to enter into an agreement with
Borrower or Successor Borrower, as applicable, and Lender, satisfactory to
Lender in its reasonable discretion, pursuant to which such Eligible
Institution shall agree to hold and distribute the Total Defeasance Collateral
or Partial Defeasance Collateral in accordance with this Agreement.  Borrower or Successor Borrower, as
applicable, shall be the owner of the Defeasance Collateral Account and shall
report all income accrued on Total Defeasance Collateral or Partial Defeasance
Collateral for federal, state and local income tax purposes in its income tax
return.  Borrower shall prepay or cause
to be prepaid all costs and expenses associated with opening and maintaining
the Defeasance Collateral Account. 
Lender shall not in any way be liable by reason of any insufficiency in
the Defeasance Collateral Account.  At
Borrower’s election, different Defeasance Collateral Accounts may be
established for each defeasance consummated pursuant to Section 2.5.1
or Section 2.5.2.


 


2.5.4       Successor Borrower. 
In
connection with a Defeasance Event under this Section 2.5, Borrower
shall, if required by the Rating Agencies or if Borrower elects to do so,
establish or designate a successor entity (the “Successor Borrower”)
which shall be a single purpose bankruptcy remote entity and which shall be
approved by the Rating Agencies.  Any
such Successor Borrower may, at Borrower’s option, be an Affiliate of
Borrower.  Borrower shall transfer and
assign all obligations, rights and duties under and to the Note or the Defeased
Note, as applicable, together with the Total Defeasance Collateral or Partial
Defeasance Collateral, as applicable, to such Successor Borrower.  Such Successor Borrower shall assume the
obligations under the Note or the Defeased Note, as applicable, and the
Defeasance Security Agreement and Borrower shall be relieved of its obligations
under such documents except to the extent of any cross-collateralization
required hereunder.  Borrower shall pay
all reasonable out-of-pocket costs and expenses incurred by Lender, including
Lender’s attorney’s fees and expenses, incurred in connection therewith.


 


36

















 


III.           REPRESENTATIONS AND WARRANTIES


 


Section 3.1            Borrower Representations. 
Borrower represents and warrants as of the date hereof, except as
described on Schedule 3.1 attached hereto, that:


 


3.1.1       Organization.  (a)  Each of Borrower and each SPC Party is duly
organized, validly existing and in good standing with full power and authority
to own its assets and conduct its business, and is duly qualified in all
jurisdictions in which the ownership or lease of its property or the conduct of
its business requires such qualification, except where the failure to be so
qualified would not have a material adverse effect on its ability to perform
its obligations hereunder, and Borrower has taken all necessary action to
authorize the execution, delivery and performance of this Agreement and the
other Loan Documents by it, and has the power and authority to execute, deliver
and perform under this Agreement, the other Loan Documents and all the transactions
contemplated hereby.


 


(b)           Borrower’s exact legal name is correctly set forth in
the first paragraph of this Agreement. 
Borrower is an organization of the type specified in the first paragraph
of this Agreement.  Borrower is
incorporated or organized under the laws of the state specified in the first
paragraph of this Agreement.  Borrower’s
principal place of business and chief executive office, and the place where
Borrower keeps its books and records, including recorded data of any kind or
nature, regardless of the medium of recording, including software, writings,
plans, specifications and schematics will be the address of Borrower set forth
in the first paragraph of this Agreement (unless Borrower notifies Lender in
writing at least thirty (30) days prior to the date of such change).  Propco Borrower’s organizational
identification number, if any, assigned by the state of its incorporation or
organization is 4254297.  Propco Borrower’s
federal tax identification number is 20-5881025.  Opco Borrower’s organizational identification
number, if any, assigned by the state of its incorporation or organization is
4255957.  Opco Borrower’s federal tax
identification number is 20-5879782. 
Borrower is not subject to back-up withholding taxes.


 


3.1.2       Proceedings.  This Agreement and the other Loan Documents have been
duly authorized, executed and delivered by Borrower and constitute a legal,
valid and binding obligation of Borrower, enforceable against Borrower in
accordance with their respective terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors’ rights generally, and by general
principles of equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law).


 


3.1.3       No Conflicts.  The execution and delivery of this Agreement and the
other Loan Documents by Borrower and the performance of its obligations
hereunder and thereunder will not conflict with any provision of any law or
regulation to which Borrower is subject, or conflict with, result in a breach
of, or constitute a default under, any of the terms, conditions or provisions
of any of Borrower’s organizational documents or any agreement or instrument to
which Borrower is a party or by which it is bound, or any order or decree
applicable to Borrower, or result in the creation or imposition of any lien on
any of Borrower’s assets or property (other than pursuant to the Loan
Documents).


 


37

















 


3.1.4       Litigation.  There is no
action, suit,.  proceeding or
investigation pending or, to Borrower’s knowledge, threatened against Borrower
in any court or by or before any other Governmental Authority which would
materially and adversely affect the ability of Borrower to carry out the
transactions contemplated by this Agreement.


 


3.1.5       Orders and Decrees. 
Borrower
is not in default with respect to any order or decree of any court or any
order, regulation or demand of any Governmental Authority, which default might
have consequences that would materially and adversely affect the condition
(financial or other) or operations of Borrower or its properties or might have
consequences that would adversely affect its performance hereunder.


 


3.1.6       Consents.  No consent, approval, authorization or
order of any court or Governmental Authority is required for the execution,
delivery and performance by Borrower of, or compliance by Borrower with, this
Agreement or the consummation of the transactions contemplated hereby, other
than those which have been obtained by Borrower.


 


3.1.7       Title.  (a)  Borrower has good, marketable
and insurable fee simple title to the real property comprising
part of each Individual Property and good title to the balance of each
Individual Property owned by it, free and clear of all Liens whatsoever except
the Permitted Encumbrances.  The
Mortgage, when properly recorded in the appropriate records, together with any
Uniform Commercial Code financing statements required to be filed in connection
therewith, will create (i) a valid, first priority, perfected lien on the
Property, subject only to Permitted Encumbrances and (ii) perfected
security interests in and to, and perfected collateral assignments of, all
personalty comprising the Property (including the Leases), all in accordance
with the terms thereof, in each case subject only to any Permitted
Encumbrances.  Except as indicated on the
Title Insurance Policy for each Individual Property if insured over by the
title company issuing the Title Insurance Policy for each Individual Property
or those that are contested in accordance with the terms of this Agreement,
there are no mechanics’, materialman’s or other similar liens or claims which
have been filed for work, labor or materials affecting the Property which are
or may be liens prior to, or equal or coordinate with, the lien of the
Mortgage.  To Borrower’s knowledge, none
of the Permitted Encumbrances, individually or in the aggregate, materially
interfere with the benefits of the security intended to be provided by the
Mortgage and this Loan Agreement, materially and adversely affect the value of
the Property in light of the manner in which the same is currently being used,
impair the use or operations of the Property or impair Borrower’s ability to
pay its obligations in a timely manner.


 


(b)           The Security Agreement, together with any Uniform
Commercial Code financing statements required to be filed in connection
therewith, will create a valid perfected lien and security interest in, and a
perfected collateral assignment of, all personalty of Opco Borrower, all in
accordance with the terms thereof, subject only to any Permitted Encumbrances.


 


3.1.8       No Plan Assets. 
As of the
date hereof and throughout the term of the Loan (a) Borrower is not and
will not be an “employee benefit plan,” as defined in Section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended (“ERISA”),
whether or not subject to Title I of ERISA, or a “plan” as defined in Section 4975 of the Code, (b) none of
the assets of Borrower constitutes or will constitute “plan assets” of one or
more such plans within the meaning of U.S. Department of Labor Regulation 29
C.F.R. Section 2510.3101 (the 


 


38

















 


“Plan Assets
Regulation”) and (c) transactions by or with Borrower are not and will
not be prohibited transactions under ERISA.


 


3.1.9       Compliance. 
Borrower
and each Individual Property and the use thereof comply in all material
respects with all applicable Legal Requirements, including, without limitation,
building and zoning ordinances and codes and Prescribed Laws.  To Borrower’s knowledge, Borrower is not in
default or violation of any order, writ, injunction, decree or demand of any
Governmental Authority, the violation of which would materially adversely
affect the condition (financial or otherwise) or business of Borrower.  To Borrower’s knowledge, Borrower has not
committed any act which may give any Governmental Authority the right to cause
Borrower to forfeit the Property or any part thereof or any monies paid in
performance of Borrower’s obligations under any of the Loan Documents.  With respect to those Individual Properties
listed on Schedule IX, Borrower hereby represents that no certificate of
occupancy is available or required in order for each such Individual Property
to be in compliance with local zoning rules and regulations in the
jurisdiction where each such Individual Property is located.


 


3.1.10     Financial Information. 
All
financial data taken as a whole, including, without limitation, the statements
of cash flow and income and operating expense, that have been delivered to
Lender in respect of the Property (other than financial forecasts) fairly
present in all material respects the financial condition of the Property as of
the date of such reports; the financial forecasts delivered to Lender were
prepared in good faith by Borrower for its own use in the ordinary course of
business.  Borrower does not have any
contingent liabilities other than its liabilities under the Loan Documents,
liabilities for taxes, unusual forward or long-term commitments or unrealized
or anticipated losses from any unfavorable commitments that are known to
Borrower and reasonably likely to have a materially adverse effect on the
Property or the operation thereof, except as referred to or reflected in said
financial statements.  Since the date of
the financial statements, there has been no material adverse change in the financial
condition, operations or business of Borrower or the Property from that set
forth in said financial statements.


 


3.1.11     Condemnation. 
No
Condemnation or other proceeding has been commenced or, to Borrower’s best
knowledge, is contemplated with respect to all or any portion of the Property
or for the relocation of roadways providing access to the Property.


 


3.1.12     Utilities and Public Access. 
Each
Individual Property has rights of access to public ways and is served by water,
sewer, sanitary sewer and storm drain facilities adequate to service such
Individual Property for its intended uses. 
All roads necessary for the current utilization of the Property for its
current purpose have been dedicated to public use and accepted by all
governmental authorities or are the subject of access easements for the benefit
of the Property.


 


3.1.13     Separate Lots. 
Each
Individual Property is comprised of one (1) or more parcels which
constitute separate tax lots and do not constitute a portion of any other tax
lot not a part of the Property.


 


3.1.14     Assessments. 
To
Borrower’s knowledge, there are no pending or proposed special or other
assessments for public improvements or otherwise affecting any 


 


39

















 


Individual Property, nor
are there any contemplated improvements to any Individual Property that may
result in such special or other assessments which, in any such case,
would have a material adverse effect on Borrower’s ability to perform its
obligations under the Loan Documents.


 


3.1.15     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 would the operation of any of the terms of the Loan Documents, or
the exercise of any right thereunder, render the Loan Documents unenforceable,
and Borrower has not asserted any right of rescission, set-off, counterclaim or
defense with respect thereto.


 


3.1.16     Assignment of Leases.  The Assignment of Leases creates a valid assignment
of, or a valid security interest in, certain rights under the Leases, subject
only to a license granted to Borrower to exercise certain rights and to perform
certain obligations of the lessor under the Leases, including the right to
operate the Property.  No Person other
than Lender, Cross Lender or Borrower has any interest in or assignment of the
Leases or any portion of the Rents due and payable or to become due and payable
thereunder.


 


3.1.17     Insurance.  Borrower has obtained and has delivered to Lender
acceptable evidence of the existence of all of the Policies, with all premiums
due and payable prepaid thereunder, reflecting the insurance coverages, amounts
and other requirements set forth in this Agreement.  No Person, including Borrower, has done, by
act or omission, anything which would impair the coverage of any of the
Policies.


 


3.1.18     Licenses.  All permits and approvals, including without
limitation, certificates of occupancy required by any Governmental Authority
for the use, occupancy and operation of the Property in the manner in which the
Property is currently being used, occupied
and operated have
been obtained and are in full force and effect except for such permits and
approvals the absence of which would not result in a material adverse effect on
the financial condition of Borrower or the Individual Property for which
Borrower failed to obtain such permit or approval.


 


3.1.19     Flood
Zone.  Except as shown
on the Survey, none of the Improvements on any Individual Property are located
in an area identified by the Federal Emergency Management Agency as a special
flood hazard area.


 


3.1.20     Physical Condition.  To Borrower’s knowledge and except as set forth in the
applicable Physical Conditions Report, each Individual Property, including,
without limitation, all buildings, improvements, parking facilities, sidewalks,
storm drainage systems, roofs, plumbing systems, HVAC systems, fire protection
systems, electrical systems, equipment, elevators, exterior sidings and doors,
landscaping, irrigation systems and all structural components, are in good
condition, order and repair in all material respects; there exists no
structural or other material defects or damages in any Individual Property,
whether latent or otherwise, and Borrower has not received notice from any
insurance company or bonding company of any defects or inadequacies in any
Individual Property, or any part thereof, which would adversely affect the
insurability of the same or cause the imposition of extraordinary


 


40














 


premiums or charges
thereon or of any termination or threatened termination of any policy of
insurance or bond.


 


3.1.21     Boundaries. 
Except as
shown on the Survey, all of the improvements which were included in determining
the appraised value of the Property lie wholly within the boundaries and
building restriction lines of each Individual Property, and no improvements on
adjoining properties encroach upon any Individual Property, and no easements or
other encumbrances affecting any Individual Property encroach upon any of the
improvements, so as to affect the value or marketability of any Individual
Property except those which are insured against by title insurance.


 


3.1.22     Leases.  Borrower represents and warrants to
Lender with respect to the Leases that: (a) the “Major Customer List”
attached hereto as Schedule I  is true, complete and correct in all material
respects, (b) the Leases identified on Schedule I  are in full force and effect and there
are no material defaults thereunder by either party, (c) Borrower has
delivered to Lender copies of all Leases with terms in excess of one (1) year
or which generate revenue in excess of Five Hundred Thousand and No/100 Dollars
($500,000.00) annually, (d) there are no Leases which contain rights or
options of the Tenant thereunder to purchase all or any part of the Property or
require the Borrower to purchase any of the Improvements other than as set
forth on Schedule I, (e) the copies of the Leases
delivered to Lender are true and complete, and there are no oral agreements
with respect thereto, (f) no Rent (including security deposits) has been
paid more than one (1) month in advance of its due date, (g) all
alterations or improvements at each Individual Property to be performed by
Borrower under each Lease has been performed as required and has been accepted
by the applicable Tenant, (h) any payments, free rent, partial rent,
rebate of rent or other payments, credits, allowances or abatements required to
be given by Borrower to any Tenant has already been received by such Tenant and
(i) all security deposits are being held in accordance with Legal
Requirements.


 


3.1.23     Filing and Recording Taxes.  All transfer taxes, deed stamps, intangible taxes or
other amounts in the nature of transfer taxes required to be paid under
applicable Legal Requirements in connection with the transfer of the Property
to Borrower have been paid or are being submitted for payment simultaneously
herewith.  All mortgage, mortgage
recording, stamp, intangible or other similar tax required to be paid under
applicable Legal Requirements in connection with the execution, delivery,
recordation, filing, registration, perfection or enforcement of any of the Loan
Documents, including, without limitation, the Mortgage, have been paid or are
being submitted for payment simultaneously herewith.  All taxes and governmental assessments due
and owing in respect of the Property have been paid, or an escrow of funds in
an amount sufficient to cover such payments has been established hereunder or
are insured against by the title insurance policy to be issued in connection
with the Mortgage.


 


3.1.24     Single Purpose. 
Borrower
hereby represents and warrants to, and covenants with, Lender that as of the
date hereof and until such time as the Debt shall be paid in full:


 


(a)           (1) Propco Borrower does not own and will not own
any asset or property other than (i) the Property, and (ii) incidental
personal property necessary for the ownership or operation of the Property and (2) Opco
Borrower does not own and will not own any asset or 


 


41

















 


property other than the
personalty and other assets owned by it necessary for the operation of the
Property.


 


(b)           (1) Propco Borrower will not engage in any
business other than the ownership, management and operation of the Property and
(2) Opco Borrower will not engage in any business other than the
management and operation of the Property, and each Borrower will conduct and
operate its business as presently conducted and operated.


 


(c)           Borrower will not enter into any contract or agreement
with any Affiliate of Borrower, any constituent party of Borrower or any
Affiliate of any constituent party, except upon terms and conditions that are
commercially reasonable (taking into account all facts and circumstances) and
either substantially similar to those that would be available on an aim’s-length
basis with third parties other than any such party or a capital contribution or
distribution.


 


(d)           Borrower has not incurred, and will not incur any
Indebtedness other than the Debt, (ii) unsecured trade payables and
operational debt not evidenced by a note and (iii) Indebtedness incurred
in the financing of equipment and other personal property used on the Property;
provided that any Indebtedness incurred pursuant to subclauses (ii) and
(iii) shall be (x) not in excess of 5%
of the outstanding
principal amount of the Loan in the aggregate, (y) paid not more than
sixty (60) days from the date incurred as to the matters in subclause (ii) above
and not more than sixty (60) days from the date due as to the matters in
subclause (iii) above and (z) incurred in the ordinary course of
business.  No Indebtedness other than the
Debt may be secured (subordinate or pari  passu) by the Property
other than Indebtedness of the type described in  and subject to the requirements of clause
(iii) of this clause (d).


 


(e)           Except as expressly contemplated by the Loan Documents
with respect to the other Borrower and the Cross Borrower, Borrower has not
made and will not make any loans or advances to any third party (including any
Affiliate or constituent party), and shall not acquire obligations or
securities of any of its Affiliates.


 


(f)            Borrower is and will remain solvent and Borrower will
pay all of its debts and liabilities (including, as applicable, a fairly
allocated portion of shared personnel and overhead expenses) only from its own
assets and as the same shall become due.


 


(g)           Borrower has done or caused to be done and will do all
things necessary to observe organizational formalities applicable to Borrower
and preserve Borrower’s existence, and Borrower will not, nor will Borrower
permit any constituent party to amend, modify or otherwise change the
partnership certificate, partnership agreement, articles of incorporation and
bylaws, operating agreement, trust or other organizational documents of
Borrower without the prior consent of Lender in any manner that (i) violates
or makes such organizational documents inconsistent with the single purpose
covenants set forth in this Section 3.1.24, or (ii) amends,
modifies or otherwise changes any provision thereof that by its terms cannot be
modified at any time when the Loan is outstanding or by its terms cannot be
modified without Lender’s consent.


 


(h)           Borrower will maintain all of its books, records,
financial statements (it being acknowledged that the agent under the Cash
Management Agency Agreement shall be continuously able to produce separate
balance sheets of the Borrowers) and (except as 


 


42

















 


contemplated in the Cash
Management Agency Agreement) bank accounts separate from those of its
Affiliates and from those of any other Person. 
Borrower’s assets will not be listed as assets on the financial
statement of any other Person, provided, however, that Borrower’s
assets may be included in a consolidated financial statement of its Affiliates provided
that (i) appropriate notation shall be made on such consolidated financial
statements (and/or in Annual Reports on Form 10-K filed with U.S.
Securities and Exchange Commission in which such financial statements are
contained) to indicate the separateness of Borrower and such Affiliates and to
indicate that Borrower’s assets and credit are not available to satisfy the
debts and other obligations of such Affiliates or any other Person and (ii) such
assets are continuously able to be listed on Borrower’s own separate balance
sheet.  Borrower will file its own tax
returns (to the extent Borrower is required to file tax returns).  Borrower shall maintain its books, records,
resolutions and agreements as official records.


 


(i)            Borrower will be, and at all times will hold itself
out to the public as, a legal entity separate and distinct from any other
entity (including any Affiliate of Borrower or any constituent party of
Borrower), shall correct any known misunderstanding regarding its status as a
separate entity, shall conduct business in its own name, shall not identify
itself or any of its Affiliates as a division or part of the other and shall
maintain and utilize separate stationery, invoices and checks bearing its own
name (except with respect to payments or communications made on behalf of the
Borrower by the counterparty to the Cash Management Agency Agreement, in which
event, such counterparty shall nevertheless identify the Borrower as the party
on whose behalf the payment or communication is being made).


 


(j)            Borrower will maintain adequate capital for the normal
obligations reasonably foreseeable in a business of its size and character and
in light of its contemplated business operations.


 


(k)           Neither Borrower nor any constituent party will seek
or effect the liquidation, dissolution, winding up, consolidation or merger, in
whole or in part, of Borrower.


 


(l)            Except as expressly contemplated by the Loan Documents
and the Cash Management Agency Agreement, Borrower will not commingle the funds
or other assets of Borrower with those of any Affiliate or constituent party or
any other Person, and will hold all of its assets in its own name.


 


(m)          Borrower has and will maintain its assets in such a
manner that it will not be costly or difficult to segregate, ascertain or
identify its individual assets from those of any Affiliate or constituent party
or any other Person.


 


(n)           Except as expressly contemplated by the Loan Documents
with respect to the other Borrower and the Cross Borrower, Borrower will not
guarantee or become obligated for the debts of any other Person and does not
and will not hold itself out to be responsible for or have its credit available
to satisfy or hold out its credit as being available to satisfy the debts or
obligations of any other Person.


 


43

















 


(o)           (i)  If Borrower is a limited partnership or a
limited liability company, (other than a single member limited liability
company that satisfies all of the requirements of Section 3.1.24(o)(ii)),
each general partner or managing member (each, an “SPC Party”) of
Borrower shall be a corporation or single member limited liability company that
satisfies all of the requirements of Section 3.1.24(o)(ii) whose
sole asset is a direct interest in Borrower of at least 0.5% (or 0.1% if Borrower is an entity formed under the laws of
Delaware) and each such SPC Party will at all times comply with each of the
representations, warranties, and covenants contained in this Section 3.1.24
as if such representation, warranty or covenant was made directly by such SPC
Party (substituting the term “SPC Party” for the term “Borrower” throughout)
and will cause Borrower to comply with this Section 3.1.24 (except
for subsections (a), (b), (d), (n) and (x)).  Upon the withdrawal or the disassociation of
an SPC Party from Borrower, Borrower shall immediately appoint a new SPC Party
whose constituent documents are substantially similar to those of the
withdrawing or disassociating SPC Party and deliver a new non-consolidation
opinion to the Rating Agency or Rating Agencies, as applicable, with respect to
the new SPC Party and its equity owners. 
If Borrower is a limited partnership, Borrower shall have at least one
general partner.  If Borrower is a
limited liability company (other than a single-member limited liability company
that satisfies all of the requirements of Section 3.1 .24(o)(ii)),
Borrower shall have at least one (1) managing member.  An SPC Party shall be organized for the sole
purpose of owning a direct interest in the Borrower, shall own no other
interests in any entity, and shall not incur indebtedness except as it may be
liable for the debts of the Borrower in its capacity as general partner of the
Borrower.


 


(ii)           If Borrower is a single member limited
liability company (“single member limited liability company” meaning a
limited liability company having only one equity member), Borrower shall be a
limited liability company organized under the laws of Delaware and shall have
either (A) two (2) non-equity members or (B) at least two
springing members, one of which, upon the dissolution of such sole member or
the withdrawal or the disassociation of the sole member from Borrower, shall
immediately become the sole member of Borrower, and the other of which shall
become the sole member of Borrower if the first such springing member no longer
is available to serve as such sole member.


 


(p)           Borrower or its SPC Party shall at all times cause
there to be at least two duly appointed Independent Directors, who are provided
by a nationally recognized company that provides professional independent
directors, of each SPC Party and of Borrower if Borrower is a single member
limited liability company.  As used
herein, “Independent Director” shall mean a natural person serving as a
director of a corporation or manager  of
a limited liability company who is not at the time of initial appointment, or
at any time while serving, and has not been at any time during the preceding
five (5) years: (a) a
stockholder or director (with the exception of serving as the Independent
Director of Borrower or any SPC Party that is an SPC Party or managing member
of Borrower), trustee, officer, employee, partner, member, attorney or counsel
of SPC Party, Borrower or any affiliate of either of them; (b) a creditor,
customer, supplier or other person who derives any of its purchases or revenues
from its activities with SPC Party, Borrower or any affiliate of either of
them; (c) a person or other entity controlling or under common control
with any Person excluded from serving as Independent Director under
subparagraph (a) or (b); or (d) a member of the immediate family of
any Person excluded from serving as Independent Director under subparagraph (a) or
(b).  As used in this definition, the
term “affiliate” means any person controlling, under common control with, or
controlled by the person in question; and the term “control” means the possession,
directly or indirectly, of the 


 


44

















 


power to direct or cause
the direction of management, policies or activities of a person or entity,
whether through ownership of voting securities, by contract or otherwise.  A natural person who satisfies the foregoing
definition other than subparagraph (b) shall not be disqualified from
serving as an Independent Director if such individual has been provided by a
nationally-recognized company that provides professional independent
directors.  A natural person who
otherwise satisfies the foregoing definition except for being the Independent
Director of a “special purpose entity” affiliated with Borrower or SPC Party
shall not be disqualified from serving as an Independent Director of Borrower
or SPC Party if such “special purpose entity” does not own a direct or indirect
equity interest in Borrower or in any co-borrower of Borrower and if such
individual is an independent director provided by a nationally-recognized company
that provides professional independent directors.  For purposes of this paragraph, a “special
purpose entity” is an entity, whose organizational documents contain
restrictions on its activities substantially similar to those set forth in Section 3.1.24
of this Agreement.


 


(q)           Borrower shall not cause or permit the board of
directors, trustees or managers of any SPC Party or of Borrower to take any
action which, under the terms of any certificate of incorporation, bylaws or
any voting trust agreement with respect to any common stock or under any
organizational document of Borrower or SPC Party, requires the vote or consent
of such Independent Directors unless at the time of such action there shall be
at least two Independent Directors then serving in such capacity who have
provide the required vote or consent.


 


(r)            Borrower shall conduct its business so that the
assumptions made with respect to Borrower in the Insolvency Opinion shall be
true and correct in all respects.  In
connection with the foregoing, Borrower hereby covenants and agrees that it
will comply with or cause the compliance with, (i) all of the facts and
assumptions (whether regarding the Borrower or any other Person) set forth in
the Insolvency Opinion, (ii) all the representations, warranties and
covenants in this Section 3.1.24, and (iii) all the
organizational documents of the Borrower and any SPC Party.


 


(s)           Borrower will not permit any Affiliate or constituent
party independent access to its bank accounts (subject to the requirements
hereof, and except with respect to the agency relationships contemplated by the
Cash Management Agency Agreement and the Cash Management Agreement).


 


(t)            Borrower will pay the salaries of its own employees
(if any) from its own funds and maintain a sufficient number of employees in
light of its contemplated business operations; provided, however,
that zero employees may be sufficient for such operations given the services
provided to Borrower by other entities and that Borrower may lease employees on
a full or part-time basis pursuant to arms-length terms.


 


(u)           Borrower will compensate each of its consultants and
agents from its funds for services provided to it and pay from its own assets
all obligations of any kind that it incurs.


 


(v)           Borrower will not buy or hold indebtedness issued by
any other Person (other than cash and investment grade securities).


 


45

















 


(w)          Except as expressly contemplated by the Loan Documents
with respect to the other Borrower and the Cross Borrower, Borrower will not
pledge its assets to secure the obligations of any other Person.


 


(x)            Borrower will not form, acquire or hold any subsidiary
or own any equity interest in any other entity.


 


(y)           Borrower will not engage in any Bankruptcy Action
without the written consent of two Independent Directors of Borrower or SPC
Party.  As used herein, “Bankruptcy
Action” shall mean, with respect to any Person, to institute proceedings to
have such Person be adjudicated bankrupt or insolvent, or consent to the
institution of bankruptcy or insolvency proceedings against such Person or file
a petition seeking, or consent to, reorganization or relief with respect to
such Person under any applicable federal or state law relating to bankruptcy or
insolvency, or consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of such Person or a
substantial part of its property, or make any assignment for the benefit of
creditors of such Person, or admit in writing such Person’s inability to pay
its debts generally as they become due, or take action in furtherance of any
such action.


 


(z)            Neither (a) ART Mortgage Borrower Propco GP
2006-1B LLC, a Delaware limited liability company (the “Propco Borrower GP”),
the general partner of Propco Borrower, nor (b) ART Mortgage Borrower Opco
GP 2006-1B LLC, a Delaware limited liability company (the “Opco Borrower GP”,
and together with Propco Borrower GP, individually or collectively, as the
context may require, “Borrower GP”), the general partner of Opco
Borrower, will own any asset or property other than (A) its respective
general partnership interest in Propco Borrower or Opco Borrower, as the case
may be, and (B) incidental personal property necessary for the ownership
of such interest or operation of Propco Borrower or Opco Borrower, as
applicable.


 


(aa)         Neither Borrower GP will engage in any business other
than being and acting as general partner of Propco Borrower or Opco Borrower,
as the case may be, and will conduct and operate its business as presently
conducted.


 


(bb)         Neither Borrower GP has incurred or will incur any
Indebtedness except as it may be liable for the debts of Propco Borrower or
Opco Borrower, as the case may be, in its capacity as general partner of the
Propco Borrower or Opco Borrower, as the case may be.


 


(cc)         Except as it is liable in its capacity as general
partner of Propco Borrower or Opco Borrower, as the case may be, neither
Borrower GP will guarantee or become obligated for the debts of any other
Person and does not and will not hold itself out to be responsible for or have
its credit available to satisfy or hold its credit as being available to
satisfy the debts or obligations of any other Person.


 


(dd)         Neither Borrower GP will fort-n, acquire or hold any
subsidiary or own any equity interest in any other entity other than Propco
Borrower or Opco Borrower, as the case may be.


 


Notwithstanding the
foregoing, none of the covenants, representations or warranties set forth in
this Section 3.1.24, elsewhere in this Agreement or in any other
Loan 


 


46

















 


Document
shall be violated by reason of the Cross Guaranty or the fact that the Borrower
and Cross Borrower have obligated themselves, and encumbered their respective
Properties (as defined herein and in the Cross Loan Agreement) and other
assets, for the Loan and the Cross Loan, respectively.


 


3.1.25     Tax Filings. 
To the
extent required, Borrower timely has filed (or has obtained effective
extensions for filing) all federal, state and local tax returns required to be
filed and has paid or made adequate provision for the payment of all federal,
state and local taxes, charges and assessments payable by Borrower.


 


3.1.26     Solvency.  Borrower (a) has not entered into
the transaction or any Loan Document with the actual intent to hinder, delay,
or defraud any creditor and (b) has received reasonably equivalent value
in exchange for its obligations under the Loan Documents.  Giving effect to the Loan, the fair saleable
value of Borrower’s assets exceeds and will, immediately following the making
of the Loan, exceed Borrower’s total liabilities, including, without
limitation, subordinated, unliquidated, disputed and contingent
liabilities.  The fair saleable value of
Borrower’s assets is and will, immediately following the making of the Loan, be
greater than Borrower’s probable liabilities, including the maximum amount of
its contingent liabilities on its debts as such debts become absolute and
matured.  Borrower’s assets do not and,
immediately following the making of the Loan will not, constitute unreasonably
small capital to carry out its business as conducted or as proposed to be
conducted.  Borrower does not intend to,
and does not believe that it will, incur Indebtedness and liabilities
(including contingent liabilities and other commitments) beyond its ability to
pay such Indebtedness and liabilities as they mature (taking into account the
timing and amounts of cash to be received by Borrower and the amounts to be
payable on or in respect of obligations of Borrower).


 


3.1.27     Federal Reserve Regulations. 
No part of
the proceeds of the Loan will be used by Borrower for the purpose of purchasing
or acquiring any “margin stock” within the meaning of Regulation U of the Board
of Governors of the Federal Reserve System or for any other purpose which would
be inconsistent with such Regulation U or any other Regulations of such Board
of Governors, or for any purposes prohibited by Legal Requirements or by the
terms and conditions of this Agreement or the other Loan Documents.


 


3.1.28     Organizational Chart. 
The
organizational chart attached as Schedule III hereto, relating to Borrower and
certain Affiliates and other parties, is true, complete and correct on and as
of the date hereof.


 


3.1.29     Bank Holding Company. 
Borrower
is not a “bank holding company” or a direct or indirect subsidiary of a “bank
holding company” as defined in the Bank Holding Company Act of 1956, as amended, and Regulation Y
thereunder of the Board of Governors of the Federal Reserve System.


 


3.1.30     No Other Debt. 
Borrower has not borrowed or received debt financing (other than permitted pursuant to this
Agreement) that has not been heretofore repaid in full:


 


3.1.31     Investment Company Act. 
Borrower is not (1) an “investment company” or a company “controlled”
by an “investment company,” within the meaning of the 


 


47

















 


Investment Company Act of
1940, as amended or (2) subject to any other federal or state law or
regulation which purports to restrict or regulate its ability to borrow money.


 


3.1.32     Intentionally Omitted.


 


3.1.33     No Bankruptcy Filing. 
Borrower is not contemplating either the filing of a petition by it
under any state or federal bankruptcy or insolvency laws or the liquidation
of its assets or
property, and Borrower does not have any knowledge of any Person contemplating
the filing of any such petition against it.


 


3.1.34     Full and Accurate Disclosure. 
To the best of Borrower’s knowledge, no information contained in this
Agreement, the other Loan Documents, or any written statement furnished by or
on behalf of Borrower pursuant to the terms of this Agreement, when considered
together, contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements contained herein or therein not misleading in light of the
circumstances under which they were made. 
There is no fact or circumstance presently known to Borrower which has
not been disclosed to Lender and which materially adversely affects, or is
reasonably likely to materially adversely affect, the Property, Borrower or its
business, operations or condition (financial or otherwise).


 


3.1.35     Foreign Person.  Borrower is
not a “foreign person” within the meaning of Section 1445(f)(3) of
the Code.


 


3.1.36     Intentionally Omitted.


 


3.1.37     No Change in Facts or Circumstances Disclosure. 
To Borrower’s knowledge, there has been no material adverse change in
any condition, fact, circumstance or event that would make the financial
statements, reports, certificates or other documents submitted in connection
with the Loan inaccurate, incomplete or otherwise misleading in any material
respect or that otherwise materially and adversely affects the business operations
or the financial condition of Borrower or the Property.


 


3.1.38     Property Management.  (a) Each
agreement comprising the Cash Management Agency Agreement is in full force and
effect and there is no default by any party thereto and no event has occurred
that, with the passage of time and/or the giving of notice, would constitute a
default thereunder.


 


(b)           The Management Agreement is in full force and effect
and there is no default by any party thereto and no event has occurred that,
with the passage of time and/or the giving of notice, would constitute a
default thereunder.


 


3.1.39     Perfection of Accounts.  Borrower
hereby represents and warrants to Lender that:


 


(a)           This Agreement, together with the other Loan
Documents, create a valid and continuing security interest (as defined in the
Uniform Commercial Code) in the Accounts in favor of Lender, which security
interest is prior to all other Liens, other than Permitted Encumbrances, and is
enforceable as such against creditors of and purchasers from Borrower.  


 


48

















 


Other than in connection
with the Loan Documents and except for Permitted Encumbrances, Borrower has not
sold or otherwise conveyed the Accounts;


 


(b)           The Accounts constitute “deposit accounts” or “securities
accounts” within the meaning of the Uniform Commercial Code, as set forth in
the Cash Management Agreement;


 


(c)           Pursuant and subject to the terms hereof; Agent has
agreed to comply with all instructions originated by Lender, without further consent
by Borrower, directing disposition of the Accounts and all sums at any time
held, deposited or invested therein, together with any interest or other
earnings thereon, and all proceeds thereof (including proceeds of sales and
other dispositions), whether accounts, general intangibles, chattel paper,
deposit accounts, instruments, documents or securities; and


 


(d)           The Accounts are not in the name of any Person other
than Borrower, as pledgor, or Lender, as pledgee.  Borrower has not consented to Agent’s
complying with instructions with respect to the Accounts from any Person other
than Lender.


 


3.1.40     Agreements. 
Borrower
is not in default in any material respect in the performance, observance or
fulfillment of any of the obligations, covenants or conditions contained in any
agreement or instrument to which it is a party or by which Borrower or the
Property is bound which default is reasonably likely to materially and
adversely effect Borrower or its business, properties or assets, operations or
financial condition, financial or otherwise.


 


3.1.41     Intentionally Omitted.


 


3.1.42     SPE Separateness Covenants. 
Borrower
hereby represents that it has complied with the separateness covenants
contained in its organizational documents since its formation and in place from
time to time.


 


Section 3.2            Survival of Representations.  The representations and warranties set forth in Section 3.1
shall survive (but shall be deemed made only as of the date hereof), and any
covenants contained in Section 3.1 shall continue, for so long as
any amount remains payable to Lender under this Agreement or any of the other
Loan Documents.


 


IV.           BORROWER COVENANTS


 


Section 4.1            Borrower Affirmative
Covenants.  Borrower hereby covenants and agrees with
Lender that:


 


4.1.1       Existence; Compliance with Legal Requirements. 
Borrower
shall do or cause to be done all things necessary to preserve, renew and keep
in full force and effect its existence, rights, licenses, permits and
franchises and comply in all material respects with all Legal Requirements
applicable to it and the Property, including, without limitation, Prescribed
Laws.


 


4.1.2       Taxes and Other Charges. 
Borrower
shall pay all Taxes and Other Charges now or hereafter levied or assessed or
imposed against the Property or any part thereof 


 


49

















 


as the same become due
and payable; provided, however, Borrower’s obligation to directly
pay Taxes shall, during the continuance of a Trigger Period, be suspended for
so long as Borrower complies with the terms and provisions of Section 6.2
hereof.  Borrower shall furnish to
Lender receipts for the payment of the Taxes and the Other Charges prior to the
date the same shall become delinquent; provided, however, that
Borrower is not required to furnish such receipts for payment of Taxes in the
event that such Taxes have been paid by Lender pursuant to Section 6.2 hereof.  Borrower shall not permit or suffer and shall
promptly discharge any lien or charge against the Property (but subject to the
foregoing provisions of this Section 4.1.2).  After prior notice to Lender (unless
subclause (v)(y) of this Section 4.1.2 is applicable),
Borrower, at its own expense, may contest by appropriate legal proceeding,
conducted in good faith and with due diligence, the amount or validity of any
Taxes or Other Charges, provided that (i) no Event of Default has
occurred and remains uncured; (ii) such proceeding shall be permitted
under and be conducted in accordance with all applicable statutes, laws and
ordinances; (iii) neither the Property nor any part thereof or interest
therein will be in danger of being sold, forfeited, terminated, canceled or
lost during the pendency of such contest; (iv) unless subclause (v)(y) of
this Section 4.1.2 is applicable, Borrower shall promptly upon
final determination thereof pay the amount of any such Taxes or Other Charges,
together with all costs, interest and penalties which may be payable in
connection therewith; (v) either (x) such proceeding shall suspend
the collection of Taxes or Other Charges from the Property or (y) Borrower
shall have paid or discharged by bond Or otherwise all of the Taxes or Other
Charges under protest; and (vi) unless subclause (v)(y) of this Section 4.1.2
is applicable, Borrower shall have furnished such security (if any) as may be
required in the proceeding, or as may be reasonably requested by Lender to
insure the payment of any contested Taxes or Other Charges, together with all
interest and penalties thereon.  Lender
may pay over any such cash or other security held by Lender to the claimant
entitled thereto at any time when, in the judgment of Lender, the entitlement
of such claimant is established.


 


4.1.3       Litigation.  Borrower shall give prompt notice to Lender of any
litigation or governmental proceedings pending or threatened against Borrower
which is not covered by insurance and could reasonably be expected to
materially adversely affect the Property or Borrower’s ability to perform its
obligations hereunder or under the other Loan Documents.


 


4.1.4       Access to Property.  Borrower shall permit agents, representatives and
employees of Lender, at Lender’s sole cost and expense (unless an Event of
Default shall have occurred and be continuing, in which case such inspection
shall be at Borrower’s sole cost and expense), to inspect the Property or any
part thereof at reasonable hours upon reasonable advance notice subject to the
terms of the Leases, and provided such entry and inspection shall not
unreasonably interfere with the usual operation and conduct of business at the
Property or the use and enjoyment of the Property by Borrower or its tenants,
customers and guests.


 


4.1.5       Further Assurances; Supplemental Mortgage
Affidavits.  Borrower shall, at Borrower’s sole cost and
expense:


 


(a)           execute and deliver to Lender such documents,
instruments, certificates, assignments and other writings, and do such other
acts necessary or desirable, to evidence, preserve and/or protect the
collateral at any time securing or intended to secure the obligations of
Borrower under the Loan Documents, as Lender may reasonably require; and


 


50














 


(b)           do and execute all and such further lawful and
reasonable acts, conveyances and assurances for the better and more effective
carrying out of the intents and purposes of this Agreement and the other Loan
Documents, as Lender shall reasonably require from time to time.


 


4.1.6       Financial Reporting. 
(a) 
Borrower shall keep and maintain or will cause to be kept and maintained proper
and accurate books and records, in accordance with GAAP, reflecting the
financial affairs of Borrower.  Lender
shall have the right from time to time during normal business hours upon
reasonable notice to Borrower to examine such books and records at the office
of Borrower or other Person maintaining such books and records and to make such
copies or extracts thereof as Lender shall desire.


 


(b)           Borrower shall furnish Lender annually, within one
hundred twenty (120) days
following the, end of each Fiscal Year,
a complete copy of Guarantor’s annual financial statements audited by a “Big
Four” accounting firm or other independent certified public accountant
acceptable to Lender prepared in accordance with GAAP, which audited financial
statements shall include a balance sheet for Guarantor and shall be
supplemented by schedules covering the Property which include statements of
income and expense for the Property and the so-called “key performance
indicators” utilized by Borrower (which shall be prepared in a manner
consistent with Borrower’s then-current practices).  Such schedules shall set forth gross revenue
and operating expenses for the Property. 
Guarantor’s annual financial statements (as supplemented pursuant to the
preceding sentence) shall he accompanied by (x) a certificate executed by
the chief financial officer (or its equivalent) of Guarantor stating that such
annual financial statement presents fairly the financial condition and the
results of operations of Guarantor and (y) a certificate executed by the
chief financial officer (or its equivalent) of Borrower stating that the
schedules attached to such annual financial statement presents fairly the
financial operating condition and the results of operations of Borrower and the
Property.  Together with such annual
financial statements, Borrower shall furnish to Lender an Officer’s Certificate
certifying as of the date thereof whether to the best of Borrower’s knowledge
there exists an event or circumstance which constitutes a Default or Event of
Default by Borrower under the Loan Documents and if such Default or Event of
Default exists, the nature thereof, the period of time it has existed and the
action then being taken to remedy the same.


 


(c)           Borrower will furnish Lender on or before the
forty-fifth (45th) day after
the end of each fiscal quarter (based on Borrower’s Fiscal Year), the following
items, accompanied by certificate from the chief financial officer (or its
equivalent) of Borrower, certifying that such items are true, correct, accurate
and complete and fairly present the financial condition and results of the
operations of Borrower and the Property in accordance with GAAP as applicable:


 


(i)            quarterly and year-to-date statements of
income and expense prepared for such quarter with respect to the Property;


 


(ii)           a calculation reflecting the
Underwritable Cash Flow as of the last day of such quarter, for such quarter
and the last four quarters;


 


51

















 


(iii)          a
“Major Customer List” for the Property, and such other reasonable information
requested by Lender with respect to such “Major Customers” and listing all
newly-leased space or customers at each Individual Property and such
information as Lender may reasonably request regarding same;


 


(iv)          from and after the occurrence of an Event
of Default or special servicing of the Loan for any reason whatsoever, a
reconciliation of the budgeted income and expenses and the actual income and
expenses for such quarter and year-to-date for the Property, prepared by
Borrower in a manner consistent with its past practices; and


 


(v)           any notice received from a Tenant
threatening non-payment of an amount of Rent that is material in light of the
Underwritable Cash Flow of the Individual Property to which such threatened
non-payment relates or other default, alleging or acknowledging a default by
landlord, requesting a termination of a Lease or a material modification of any
Lease or notifying Borrower of the exercise or non-exercise of any material
option provided for in such Tenant’s Lease, or any other similar material
correspondence received by Borrower from Tenants during the subject fiscal
quarter, in each case only if the same is material in light of the
Underwritable Cash Flow of the Individual Property to which it relates.


 


(d)           Intentionally Omitted.


 


(e)           Borrower shall submit the Annual Budget to Lender
within thirty (30) days following the commencement of each Fiscal Year (or as
soon thereafter as the Board of Trustees of Guarantor has approved the
same).  During the continuation of a Cash
Trap Period or an Event of Default only, discretionary operating and capital
expense items contained in said Annual Budget (and no other matters contained
therein) shall be subject to Lender’s approval (such approval not to be
unreasonably withheld, conditioned or delayed). 
Each Annual Budget shall set forth in reasonable detail budgeted monthly
operating income and monthly operating and capital expenses and other cash
expenses for the Property.  If Lender’s
approval is required hereunder, (i) in the event Lender objects to any
discretionary operating and capital expense item contained in a proposed Annual
Budget, Lender shall advise Borrower of such objections in writing within ten (10) Business
Days after receipt thereof (and deliver to Borrower a reasonably detailed
description of such objections), and Borrower shall revise such Annual Budget
within five (5) Business Days after receipt of such
notice and resubmit the same to Lender; and (ii) Lender shall advise
Borrower in writing of any reasonable objections to any discretionary operating
and capital expense items contained in such revised Annual Budget within five (5) Business
Days after receipt thereof (and deliver to Borrower a reasonably detailed
description of such objections), and Borrower shall revise such Annual Budget
in accordance with the process described in this Section until Lender approves
all of the discretionary operating and capital expense items contained in such
Annual Budget.  Each Annual Budget which
contains discretionary operating and capital expense items approved or deemed
approved by Lender in accordance with the terms hereof shall be referred to
herein as an “Approved Annual Budget”. 
If Lender’s approval is required hereunder, until such time that Lender
approves all of the discretionary operating and capital expense items contained
in such proposed Annual Budget, with respect to any discretionary operating and
capital expense items contained therein, an increase in an amount equal to the
increase in the Consumer Price Index for All Urban 


 


52

















 


Consumers since the most
recently Approved Annual Budget shall be permitted with respect to such
discretionary operating and capital expense items.  Any proposed Annual Budget submitted for
Lender’s approval of the discretionary operating and capital expense items
contained therein pursuant to this Section 4.1.6(e) which
states at the top of such submittal “THIS ANNUAL BUDGET IS
BEING SUBMITTED FOR APPROVAL OF THE DISCRETIONARY OPERATING AND CAPITAL EXPENSE
ITEMS CONTAINED THEREIN PURSUANT TO SECTION 4.1.6(e) OF THE LOAN
AGREEMENT.  THE OPERATING AND CAPITAL
EXPENSE DISCRETIONARY ITEMS CONTAINED IN THIS ANNUAL BUDGET SHALL BE DEEMED
APPROVED BY LENDER IF LENDER DOES NOT NOTIFY BORROWER IN WRITING OF ITS
DISAPPROVAL, TOGETHER WITH THE GROUNDS FOR SUCH DISAPPROVAL, WITHIN TEN (10) BUSINESS
DAYS,” shall be deemed approved if Lender shall have not notified
Borrower in writing of its disapproval (together with a reasonably detailed
statement of the grounds of such disapproval) within ten (10) Business
Days after Borrower has submitted such Annual Budget in such manner to
Lender.  Any revised proposed Annual
Budget resubmitted for Lender’s approval of the discretionary operating and
capital expense items contained therein pursuant to this Section 4.1.6(e) due
to Lender’s reasonable objections to any discretionary operating and capital
expense items contained in an Annual Budget previously submitted to Lender
pursuant to this Section 4.1.6(e) which states at the top of
such submittal “THIS ANNUAL BUDGET IS BEING
RESUBMITTED FOR APPROVAL OF THE DISCRETIONARY OPERATING AND CAPITAL EXPENSE
ITEMS CONTAINED THEREIN PURSUANT TO SECTION 4.1.6(e) OF THE LOAN
AGREEMENT.  THE DISCRETIONARY OPERATING
AND CAPITAL EXPENSE ITEMS CONTAINED IN THIS REVISED ANNUAL BUDGET SHALL BE
DEEMED APPROVED BY LENDER IF LENDER DOES NOT NOTIFY BORROWER IN WRITING OF ITS
DISAPPROVAL, TOGETHER WITH THE GROUNDS FOR SUCH DISAPPROVAL, WITHIN FIVE (5) BUSINESS DAYS,” shall be deemed approved if Lender shall
have not notified Borrower in writing of its disapproval (together with a reasonably
detailed statement of the grounds of such disapproval) within five (5) Business
Days after Borrower has submitted such revised Annual Budget in such manner to
Lender.


 


(f)            If, at the time one or more Disclosure Documents are
being prepared for a Securitization, Lender expects that Borrower alone or
Borrower and one or more Affiliates of Borrower collectively, or the Property
and Related Property collectively, will be a Significant Obligor, Lender will
so notify Borrower in writing and Borrower shall furnish to Lender upon written
request (i) the selected financial data or, if applicable, Underwritable
Cash Flow, required under Item 1112(b)(1) of Regulation AB, if Lender
expects that the principal amount of the Loan together with any Related Loans
as of the cut-off date for such Securitization may, or if the principal amount
of the Loan together with any Related Loans as of the cut-off date for such
Securitization and at any time during which the Loan and any Related Loans are
included in a Securitization does, equal or exceed ten percent (10%) (but less
than twenty percent (20%)) of the aggregate principal amount of all mortgage
loans included or expected to be included, as applicable, in the Securitization
or (ii) the financial statements required under item 1112(b)(2) of
Regulation AB, if Lender expects that the principal amount of the Loan together
with any Related Loans as of the cut-off date for such Securitization may, or
if the principal amount of the Loan together with any Related Loans as of the cut-off
date for such Securitization and at any time during which the Loan and any
Related Loans are included in a Securitization does, equal 


 


53

















 


or exceed twenty percent
(20%) of the aggregate principal amount of all mortgage loans included or
expected to be included, as applicable, in the Securitization.  Such financial data or financial statements
shall be furnished to Lender (A) within ten (10) Business Days after
notice from Lender in connection with the preparation of Disclosure Documents
for the Securitization, (B) not later than thirty (30) days after the end
of each fiscal quarter of Borrower and (C) not later than seventy-five (75) days after the end of each
fiscal year of Borrower; provided, however, that Borrower shall
not be obligated to furnish financial data or financial statements pursuant to
clauses (B) or (C) of this sentence with respect to any period for
which a filing pursuant to the Exchange Act in connection with or relating to
the Securitization is not required.  If
requested by Lender, Borrower shall furnish to Lender financial data and/or
financial statements for any Tenant of any of the Individual Properties if
available to Borrower and Borrower is not restricted from disclosing the same
to Lender by such Tenant and if in connection with a Securitization, Lender
expects there to be, with respect to such Tenant or group of affiliated
Tenants, a concentration within all of the mortgage loans included or expected
to be included, as applicable, in the Securitization such that such Tenant or
group of affiliated Tenants would constitute a Significant Obligor.


 


(g)           If requested by Lender, Borrower shall provide such
financial and other information as shall be required pursuant to Regulation AB
in connection with a Securitization.


 


(h)           All financial data and financial statements provided
by Borrower pursuant to Section 4.1.6(f) or Section 4.1.6(g) shall
meet the requirements of Regulation AB and other applicable legal requirements,
if required by Lender.


 


4.1.7       Title to the Property. 
Borrower will warrant and defend the validity and priority of the Liens
of the Mortgage and the Assignment of Leases on the Property against the claims
of all Persons whomsoever, subject only to Permitted Encumbrances.


 


4.1.8       Estoppel Statement.  (a) 
After request by Lender, Borrower shall within ten (10) Business Days
furnish Lender with a statement, duly acknowledged and certified, stating to
the best of Borrower’s knowledge (i) the unpaid principal amount of the Note,
(ii) the Applicable Interest Rate of the Note, (iii) the date
installments of interest and/or principal were last paid, (iv) any offsets
or defenses to the payment of the Debt, if any, and (v) that this
Agreement and the other Loan Documents have not been modified or if modified,
giving particulars of such modification.


 


(b)           After request by Borrower, Lender shall within ten (10) Business
Days furnish Borrower with a statement, duly acknowledged and certified,
stating (i) the unpaid principal amount of the Note, (ii) the
Applicable Interest Rate of the Note, (iii) the date installments of
interest and/or principal were last paid and (iv) whether or
not Lender has sent any notice of default under the Loan Documents which
remains uncured in the opinion of Lender.


 


4.1.9       Leases.  (a)  All
Leases and all renewals of Leases executed after the date hereof shall (i) be
on commercially reasonable terms, (ii) provide that such Lease is
subordinate to the Mortgage and that the lessee will attorn to Lender and any
purchaser at a foreclosure sale (provided, however, that Borrower
shall be required only to use commercially reasonable efforts 


 


54

















 


to obtain such
subordination and attornment provisions in the Warehouse Agreements) and (iii) not
contain any terms which would materially adversely affect Lender’s rights under
the Loan Documents Any Major Leases and all renewals, amendments and
modifications thereof executed after the date hereof shall be subject to Lender’s
prior approval, which approval shall not be unreasonably withheld or delayed,
and subject to delivery by Borrower of a Rating Agency Confirmation with
respect to such Major Lease.  Borrower
shall pay all reasonable actual out-of-pocket costs and expenses (including
reasonable attorney’s fees but excluding internal fees) incurred by Lender or
Servicer in connection with its review of a Major Lease, including, without
limitation, the fees and charges of the Rating Agencies.  Lender shall execute and deliver a
Subordination Non-Disturbance and Attornment Agreement in the form annexed as Schedule
IV to the Tenant under any future Major Lease approved by Lender or any
other Lease entered into, subject to and in accordance with this Section 4.1.9(a) promptly
upon request with such commercially reasonable changes as may be requested
by the Tenant, from time to time, and which are reasonably acceptable to
Lender, provided that Borrower shall pay all reasonable costs and
expenses incurred by Lender in connection with such Subordination
Non-Disturbance and Attornment Agreement.


 


(b)           Borrower:


 


(i)            shall observe and perform, or cause to be
observed and performed, in a commercially reasonable manner the material
obligations imposed upon the lessor under Leases in which Borrower is the
lessor;


 


(ii)           shall enforce, or cause to be enforced as
against, the lessees, in a commercially reasonable manner the material terms,
covenants and conditions contained in the Leases under which Borrower is the
lessor, provided, however, Borrower shall not terminate or accept
a surrender of a Major Lease without Lender’s prior approval (which approval
may be conditioned upon receipt by Lender of a Rating Agency Confirmation) and
shall not terminate or accept a surrender of any other Lease without Lender’s
approval, unless such termination or surrender, when taken together with any
replacement Lease(s), will not have a material adverse effect on the applicable
Individual Property;


 


(iii)          shall
not collect, or cause or permit to be collected, any of the Rents more than one
(1) month in advance and shall not grant its approval of Manager’s
collection of any of the Rents more than one (1) month in advance (other
than security deposits);


 


(iv)          shall not grant any assignment of lessor’s
interest in the Leases or the Rents (except as contemplated by the Loan
Documents);


 


(v)           intentionally omitted; and


 


(vi)          in its capacity as lessor, shall hold all
security deposits under all Leases in accordance with Legal Requirements and
upon request, shall furnish Lender with executed copies of all Leases.


 


(c)           Any proposed Lease, or any amendment, modification or
termination of a Lease, that in each case requires Lender’s consent pursuant to
this Section 4.1.9 which is, in each 


 


55

















 


case, accompanied by a
summary of the material terms of such document(s) (including any economic
terms and any termination options) and which states at the top of such
submittal “THIS IS A REQUEST FOR APPROVAL OF A LEASE,
AMENDMENT, MODIFICATION OR TERMINATION OF A LEASE PURSUANT TO SECTION 4.1.9
OF THE LOAN AGREEMENT.  THIS LEASE OR AN
AMENDMENT, MODIFICATION OR TERMINATION THEREOF SHALL BE DEEMED APPROVED BY
LENDER IF LENDER DOES NOT NOTIFY BORROWER IN WRITING OF ITS DISAPPROVAL,
TOGETHER WITH THE GROUNDS FOR SUCH DISAPPROVAL, WITHIN FIFTEEN (15) CALENDAR
DAYS,” shall be deemed approved if Lender shall have not notified
Borrower in writing of its disapproval (together with a statement of the
grounds of such disapproval) within fifteen (15) calendar days after Borrower
has submitted such Lease, or any such amendment, modification or termination of
a Lease in such manner to Lender.


 


(d)           Borrower shall use good faith efforts to obtain,
within sixty (60) days after Lender’s request therefor, Subordination,
Non-Disturbance and Attornment Agreements in the form annexed as Schedule IV
from all Major Tenants then in existence.


 


4.1.10     Alterations. 
(a) Lender’s
prior approval shall be required in connection with any (i) Alterations to
any Improvements (except tenant improvements under any Lease approved by Lender
or Alterations required in order to comply with applicable Legal Requirements)
that would reasonably be expected to have a material adverse effect on Borrower’s
financial condition, the value of the Property or the ongoing cash flow of the
Property or (ii) any Alterations that are structural in nature to any
Improvements (except tenant improvements under any Lease approved by Lender or
Alterations required in order to comply with applicable Legal Requirements),
the aggregate cost of which (including any related structural Alteration) is
reasonably anticipated to exceed the Alteration Threshold, which approval shall
not be unreasonably withheld, conditioned or delayed.  If the total unpaid amounts incurred and to
be incurred with respect to such Alterations set forth in clause (i) and (ii) above
(whether or not Lender’s prior approval is required with respect to such
Alterations), shall at any time exceed the Alteration Threshold, Borrower shall
promptly deliver to Lender, at Borrower’s option, but subject to the next
succeeding sentence, any one or more of the following: (A) as security for
the payment of such amounts and as additional security for Borrower’s
obligations under the Loan Documents any of the following: (1) cash, (2) Letters
of Credit, (3) U.S. Obligations, (4) other securities acceptable to
Lender, provided that Lender shall have received a Rating Agency Confirmation
as to the form and issuer of same, or (5) a completion bond, provided that
Lender shall have received a Rating Agency Confirmation as to the form and
issuer of same (any of the foregoing, “Alteration Security”) and/or (B) a
guaranty in the form attached as Schedule XII from Guarantor or a Person
with an Investment Grade Rating reasonably acceptable to Lender containing the “Guaranteed
Obligations” as defined therein (each, an “Alteration Guaranty”; any
Alteration Security and/or Alteration Guaranty so delivered are collectively,
the “Alteration Collateral”).  The
amount of the Alteration Security together with the amount of the “Guaranteed
Obligations” under any Alteration Guaranty delivered pursuant to this Section 4.1.10
shall be in an amount (the “Excess Alteration Amount”) equal to the
excess of the total unpaid amounts to be incurred with respect to such
Alterations (other than such amounts to he paid or reimbursed by Tenants under
the Leases) over the Alteration Threshold, which required amount (y) shall
be reduced as such Alteration progresses in an amount which is commensurate
with the amount expended in connection with such Alteration and (z) in the
case 


 


56

















 


of any Capital
Expenditures, shall be reduced by the amount of any Capital Expenditure Funds
on deposit at the time such Alteration is commenced.  If the Alteration Guaranty delivered in
accordance with this Section 4.1.10 is by Guarantor, and the
aggregate potential liability of Guarantor pursuant to such Alteration Guaranty
and any and all other guarantees and indemnities delivered by Guarantor
pursuant to this Agreement and the other Loan Documents (excluding for these
purposes the Guaranty) exceeds ten percent (10%) of the outstanding principal
amount of the Loan, then Borrower shall have delivered to Lender a new
non-consolidation opinion acceptable to the Rating Agencies which states that
the existence of such Alteration Guaranty does not alter any of the conclusions
contained in any non-consolidation opinion previously delivered to Lender in
connection with the Loan.  If any other
Person other than Guarantor delivers an Alteration Guaranty in accordance with
this Section 4.1.10, Borrower shall have delivered to Lender a new
non-consolidation opinion acceptable to the Rating Agencies which states that
the existence of such Alteration Guaranty does not alter any of the conclusions
contained in any non-consolidation opinion previously delivered to Lender in
connection with the Loan and which includes an additional pairing between
Borrower and such other Person.  Lender
hereby agrees to accept on a several (but not joint) basis the aggregate
Alteration Collateral required pursuant to this Section 4.1.10 in
such proportions as Borrower may specify. 
Any and all Alterations shall be performed in compliance with all Legal
Requirements in a manner that does not significantly disrupt the business
otherwise conducted at each Individual Property.  Upon completion of the Alterations to which
any security delivered by Borrower pursuant to this Section 4.1.10
relates, Lender shall promptly return such excess security to Borrower.


 


(a)           Any proposed Alteration that requires Lender’s consent
pursuant to this Section 4.1.10 which is, in each case, accompanied
by a reasonably detailed description of the Alteration and the plans and specifications
therefor and which states at the top of such submittal “THIS
IS A REQUEST
FOR APPROVAL OF AN ALTERATION PURSUANT TO SECTION 4.1.10 OF THE LOAN
AGREEMENT.  THIS ALTERATION SHALL BE
DEEMED APPROVED BY LENDER IF LENDER DOES NOT NOTIFY BORROWER IN WRITING OF ITS
DISAPPROVAL, TOGETHER WITH THE GROUNDS FOR SUCH DISAPPROVAL, WITHIN FIFTEEN
(15) BUSINESS DAYS,” shall be deemed approved if Lender shall have not notified Borrower in
writing of its disapproval (together with a reasonably detailed statement of
the grounds of such disapproval) within fifteen (15) Business Days after
Borrower has submitted such request for approval of a proposed Alteration in
such manner to Lender.


 


4.1.11     Intentionally Omitted.


 


4.1.12     Material Agreements.  Borrower shall, to the extent Borrower’s failure to so
act would cause a material adverse effect upon Borrower’ ability to perform its
obligations under this Agreement or the other Loan Documents, (a) promptly
perform and/or observe all of the material covenants and agreements required to
be performed and observed by it under each Material Agreement to which it is a
party, and do all things necessary to preserve and to keep unimpaired its
rights thereunder unless the other party thereunder is in default of its
obligations to Borrower, (b) promptly notify Lender in writing of the
giving of any notice of any default by any party under any Material Agreement
of which it is aware and (c) promptly enforce the performance and
observance of all of the material covenants and agreements required to be 


 


57

















 


performed and/or observed
by the other party under each Material Agreement to which it is a party in a
commercially reasonable manner.


 


4.1.13     Performance by Borrower.  Borrower shall in a timely manner observe, perform and
fulfill each and every covenant, term and provision of each Loan Document
executed and delivered by Borrower, and shall not enter into or otherwise
suffer or permit any amendment, waiver, supplement, termination or other
modification of any Loan Document executed and delivered by Borrower without
the prior consent of Lender.


 


4.1.14     Costs of Enforcement/Remedying
Defaults.  In the event (a) that the Mortgage
is foreclosed in whole or in part or, following the occurrence and during the
continuance of an Event of Default, the Note or any other Loan Document is put
into the hands of an attorney for collection, suit, action or foreclosure, (b) of
the foreclosure of any Lien or Mortgage prior to or subsequent to the Mortgage
in which proceeding Lender is made a party, (c) of the bankruptcy,
insolvency, rehabilitation or other similar proceeding in respect of Borrower
or Guarantor or an assignment by Borrower or Guarantor for the benefit of its
creditors, or (d) Lender shall remedy or attempt to remedy any Event of
Default hereunder, Borrower shall be chargeable with and agrees to pay all
costs incurred by Lender as a result thereof, including costs of collection and
defense (including reasonable attorneys’, experts’, consultants’ and witnesses’
fees and disbursements) in connection therewith and in connection with any
appellate proceeding or post-judgment action involved therein, which shall be
due and payable on demand, together with interest thereon from the date
incurred by Lender at the Default Rate, and together with all required service
or use taxes.


 


4.1.15     Business and Operations.  Borrower will continue to engage in the businesses currently
conducted by it as and to the extent the same are necessary for the ownership,
operation and leasing of the Property. 
Borrower will qualify to do business and will remain in good standing
under the laws of each jurisdiction as and to the extent the same are required
for the ownership, operation and leasing of the related Property.  Borrower shall at all times cause the
Property to be maintained as cold and/or dry storage warehouse facilities and
uses incidental thereto.


 


4.1.16     Intentionally Omitted.


 


4.1.17     Intentionally Omitted.


 


4.1.18     Cash Management Agency Agreement.  (a)  Borrower shall observe and perform, and
shall cause each party thereto to observe and perform, in a commercially
reasonable manner the material obligations imposed upon Borrower or any other
party thereto under each agreement comprising the Cash Management Agency
Agreement, except where the failure to so observe and perform would not have a
Material Adverse Effect.


 


(b)           Borrower shall enforce, as against each counterparty
thereto, its rights under each agreement comprising the Cash Management Agency
Agreement to which it is a party, in a commercially reasonable manner, except
where the failure to enforce such rights under the Cash Management Agency
Agreement would not have a Material Adverse Effect; provided, however,
that, Borrower shall not terminate or accept a surrender of; or cause or permit



 


58

















 


the termination or
surrender of any agreement comprising the Cash Management Agency Agreement
without Lender’s prior approval, except where the termination or acceptance of
a surrender of any such agreement comprising the Cash Management Agency
Agreement would not have a Material Adverse Effect.


 


Section 4.2            Borrower Negative Covenants.  Borrower covenants and agrees with Lender that:


 


4.2.1       Due on Sale and Encumbrance; Transfers of
Interests.  Without the prior written consent of
Lender, neither Borrower nor any other Person having a direct or indirect
ownership or beneficial interest in Borrower shall sell, convey, mortgage,
grant, bargain, encumber, pledge, assign or Transfer any interest, direct or
indirect, in the Borrower, the Property or any part thereof; whether
voluntarily or involuntarily, by operation of law or otherwise, in violation of
the covenants and conditions set forth in the Mortgage and this Agreement.


 


4.2.2       Liens.  Subject to Borrower’s right to contest
Taxes or Other Charges pursuant to this Agreement or any other Loan Documents,
Borrower shall not create, incur, assume or suffer to exist any Lien on any
portion of the Property except for Permitted Encumbrances.


 


4.2.3       Dissolution. 
Borrower
shall not (i) engage in any dissolution, liquidation or consolidation or
merger with or into any other business entity, (ii) engage in any business
activity not related to the ownership and operation of the Property or (iii) transfer,
lease or sell, in one transaction or any combination of transactions, all or
substantially all of the property or assets of Borrower except to the extent
expressly permitted by the Loan Documents.


 


4.2.4       Change in Business. 
Borrower
shall not enter into any line of business other than the ownership and
operation of the Property.


 


4.2.5       Debt Cancellation. 
Borrower
shall not cancel or otherwise forgive or release any claim or debt (other than
termination of Leases subject to the requirements hereof) owed to Borrower by
any Person, except for adequate consideration and in the ordinary course of
Borrower’s business.


 


4.2.6       Affiliate Transactions. 
Other than
as expressly permitted herein, Borrower shall not enter into, or be a party to,
any transaction with an Affiliate of Borrower or any of the partners of
Borrower except in the ordinary course of business and on terms which are fully
disclosed to Lender in advance and are no less favorable to Borrower or such
Affiliate than would be obtained in a comparable arm’s length transaction with
an unrelated third party.


 


4.2.7       Zoning.  Except as would not have a material
adverse effect on Borrower’s ability to perform its obligations hereunder,
Borrower shall not initiate or consent to any zoning reclassification of any
portion of any Individual Property or seek any variance under any existing
zoning ordinance or use or permit the use of any portion of any Individual
Property in any manner that could result in such use becoming a non-conforming
use under any zoning ordinance or any other applicable land use law, rule or
regulation, without the prior consent of Lender.


 


59














 


4.2.8       Assets.  Borrower shall not purchase or own any
property other than the Property and any property necessary or incidental for
the operation of the Property.


 


4.2.9       No Joint Assessment. 
Borrower
shall not suffer, permit or initiate the joint assessment of any Individual
Property (i) with any other real property constituting a tax Tot separate
from any Individual Property, and (ii) with any portion of any Individual
Property which may be deemed to constitute personal property, or any other
procedure whereby the lien of any taxes which may be levied against such
personal property shall be assessed or levied or charged to any Individual
Property.


 


4.2.10     Principal Place of Business. 
Borrower
shall not change its principal place of business from the address set forth on
the first page of this Agreement without first giving Lender ten (10) days’
prior notice.


 


4.2.11     ERISA.  (a)  Borrower shall not engage in
any transaction which would cause any obligation, or action taken or to be
taken, hereunder (or the exercise by Lender of any of its rights under the
Note, this Agreement or the other Loan Documents) to be a non-exempt (under a
statutory or administrative class exemption) prohibited transaction under ERISA
or Section 4975 of the
Code.


 


(b)           Borrower shall deliver to Lender such certifications
or other evidence from time to time throughout the term of the Loan, as
requested by Lender in its sole discretion, that (A) Borrower is not an “employee
benefit plan” as defined in Section 3(3) of ERISA, whether or not
subject to Title I of ERISA, or a “plan” within the meaning of Section 4975 of the Code; and (B) one or
more of the following circumstances is true:


 


(i)            Equity interests in Borrower are publicly
offered securities, within the meaning of the Plan Assets Regulation;


 


(ii)           Less than twenty-five percent (25%) of each outstanding class of
equity interests in Borrower is held by “benefit plan investors” within the
meaning of the Plan Assets Regulation; or


 


(iii)          Borrower
qualifies as an “operating company” or a “real estate
operating company”
within the meaning of the Plan Assets Regulation.


 


4.2.12     Material
Agreements. 
Except as
would not have a material adverse effect on Borrower’s ability to perform its
obligations under this Agreement and the other Loan Documents, Borrower shall
not, without Lender’s prior written consent: (a) enter into any Material
Agreement, except on commercially reasonable terms, (b) surrender or
terminate any Material Agreement to which it is a party other than in the
ordinary course of Borrower’s business, including where the same is being
replaced or is no longer necessary (unless the other party thereto is in
material default and the termination of such agreement would be commercially
reasonable), (c) increase or consent to the increase of the amount of any
charges under any Material Agreement to which it is a party, except as provided
therein or on an arms’ length basis and commercially reasonable terms; or (d) otherwise
modify, change, supplement, alter or amend, or waive or release any of its
rights and remedies under any Material Agreement to 


 


60

















 


which it is a party in
any material respect other than in the ordinary course of Borrower’s business,
except on an arm’s length basis and commercially reasonable terms.


 


4.2.13     Intentionally Omitted.


 


4.2.14     Intentionally Omitted.


 


4.2.15     Intentionally Omitted.


 


4.2.16     Cash Management Agency Agreement. 
Borrower
shall not, without the prior written consent of Lender, modify, supplement,
restate, amend or waive any provision of the Cash Management Agency Agreement
in any manner whatsoever that (a) reduces the amount payable by the
counterparty thereto to Borrower thereunder, (b) reduces or otherwise
limits Borrower’s right to terminate the Cash Management Agency Agreement or (c) would
cause or result in a Material Adverse Effect. 
Nothing contained in this Agreement or any other Loan Document shall
constrain the termination of the Cash Management Agency Agreement so long as
such termination would not have a Material Adverse Effect.


 


V.            INSURANCE, CASUALTY AND
CONDEMNATION


 


Section 5.1            Insurance.


 


5.1.1       Insurance Policies. 
(a) 
Borrower shall obtain and maintain, or cause to be maintained, insurance for
Borrower and the Property providing at least the following coverages:


 


(i)            all risk insurance on the improvements
and the personal property at the Property, including contingent liability from
Operation of Building Laws, Demolition Costs and Increased Cost of Construction
Endorsements, in each case (A) in an amount equal to one hundred percent
(100%) of the “Full Replacement Cost,” which for purposes of this Agreement
shall mean actual replacement value (exclusive of costs of excavations,
foundations, underground utilities and footings) with a waiver of depreciation;
(B) containing an agreed amount endorsement with respect to the
Improvements and personal property at the Property waiving all co-insurance
provisions; (C) providing for no deductible in excess of Two Hundred Fifty
Thousand and No/100 Dollars ($250,000)
(except with respect to floods, wind and earthquakes, each of which
shall be limited to 5% of the insurable value per loss or at prevailing market
deductibles, with such increase to be approved by Lender, such approval not to
be unreasonably withheld, delayed or conditioned) for all such insurance
coverage; and (D) containing an “Ordinance or Law Coverage” (sublimit of
$10,000,000 for property damage and $2,000,000 for business interruption in
respect of the Property or such lesser sublimits as may be commercially
available as determined by Lender in its reasonable discretion) or “Enforcement”
endorsement if any of the Improvements or the use of the Property shall at any
time constitute legal non-conforming structures or uses.  In addition, Borrower shall obtain: (y) if
any portion of the Improvements at any Individual Property is currently or at
any time in the future located in a federally designated “special flood hazard
area,” flood hazard insurance in an amount equal to the lesser of (1) the
Allocated Loan Amount of such Individual Property or (2) the maximum
amount of such insurance available under 


 


61

















 


the National Flood Insurance Act of 1968, the Flood Disaster Protection
Act of 1973 or the National Flood Insurance Reform Act of 1994, as each may be
amended; and (z) earthquake insurance in amounts and in form and substance
satisfactory to Lender in the event any Individual Property is located in an
area with a high degree of seismic activity, provided that the insurance
pursuant to clauses (y) and (z) hereof shall be on terms consistent
with the all risk insurance policy required under this subsection (i).


 


(ii)           commercial general liability insurance
against claims for personal injury, bodily injury, death or property damage
occurring upon, in or about the Property, such insurance (A) to be on the
so-called “occurrence” form with a combined limit, including umbrella coverage,
of not less than Twenty-Five Million and No/100 Dollars ($25,000,000); (B) to
continue at not less than the aforesaid limit until required to be changed by
Lender by reason of changed economic conditions making such protection
inadequate; and (C) to cover at least the following hazards: (1) premises
and operations; (2) products and completed operations on an “if any”
basis; (3) independent contractors; (4) blanket contractual liability
for all legal contracts; and (5) contractual liability covering the
indemnities contained in Article 9 of the Mortgage to the extent the same
is available, the terms of excess coverage to “follow form” over the primary
general liability insurance and the commercial motor vehicle liability coverage
required under clause (viii) below;


 


(iii)          business
income insurance (A) with loss payable to Lender; (B) covering all
risks required to be covered by the insurance provided for in subsection (i) above
for a period commencing at the time of loss for such length of time as it takes
to repair or replace with the exercise of due diligence and dispatch, but in no
event in an amount less than one year; and (C) containing an extended
period of indemnity endorsement which provides that after the physical loss to
the Improvements and Personal Property has been repaired, the continued loss of
income will be insured until such income either returns to the same level it
was at prior to the loss, or the expiration of one hundred twenty (120) days
from the date that the affected Individual Property is repaired or replaced and
operations are resumed, whichever first occurs, and notwithstanding that the
policy may expire prior to the end of such period.  The amount of coverage required for business
income insurance pursuant to this Section 5.1.1(a)(iii) shall
be included in the coverage amounts specified in Section 5.1.1(a)(i) above.  All proceeds payable to Lender pursuant to
this subsection shall be held by Lender and shall be applied to the obligations
secured by the Loan Documents from time to time due and payable hereunder and
under the Note; provided, however, that nothing herein contained
shall be deemed to relieve Borrower of its obligations to pay the obligations
secured by the Loan Documents on the respective dates of payment provided for
in the Note and the other Loan Documents except to the extent such amounts are
actually paid out of the proceeds of such business income insurance;


 


(iv)          at all times during which structural
construction, repairs or alterations are being made with respect to the
Improvements, and only if the Property coverage form does not otherwise apply, (A) owner’s
contingent or protective liability insurance covering claims not covered by or
under the terms or provisions of the above mentioned commercial general
liability insurance policy; and (B) the insurance provided for in 


 


62

















 


subsection (i) above written in a so-called builder’s risk
completed value form (1) on a non-reporting basis, (2) against all
risks insured against pursuant to subsection (i) above, (3) including
permission to occupy the Property, and (4) with an agreed amount
endorsement waiving co-insurance provisions;


 


(v)           workers’ compensation, subject to the
statutory limits of the state in which the Property is located, and employer’s
liability insurance with a limit of at least One Million and No/100 Dollars
($1,000,000) per accident and per disease per employee, and One Million and
No/100 Dollars ($1,000,000) for disease aggregate in respect of any work or
operations on or about the Property, or in connection with the Property or its
operation (if applicable);


 


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


 


(vii)         Intentionally
Omitted;


 


(viii)        motor
vehicle liability coverage for all owned and non-owned vehicles, including
rented and leased vehicles containing minimum limits per occurrence, including
umbrella coverage, of One Million and No/ 100 Dollars ($1,000,000);


 


(ix)           Intentionally Omitted;


 


(x)            insurance against employee dishonesty in
an amount not less than Three Million and No/100 Dollars ($3,000,000) and with
a deductible not greater than One Hundred Thousand and No/100 Dollars
($100,000);


 


(xi)           (A) during any period of the term of
the Loan that TRIA is in effect, if “acts of terrorism” or other similar acts
or events are hereafter excluded from Borrower’s all risk insurance policy
(including business income), Borrower shall obtain an endorsement to such
policy insuring against all “certified acts of terrorism” as defined by TRIA,
in an amount equal to the Release Amount applicable to the Individual Property
with the highest then-outstanding Allocated Loan Amount.  The endorsement shall be in form and substance
reasonably satisfactory to Lender and shall meet Rating Agency criteria for
securitized loans; or


 


(B) during any period
of the term of the Loan that TRIA is not in effect, or the endorsement referred
to in (A) above is not available, if “acts of terrorism” or other similar
acts are hereafter excluded from Borrower’s all risk insurance policy or
business income insurance coverage, Borrower shall obtain an endorsement to
such policy or a separate policy from an insurance provider, insuring against
all such excluded acts or events, to the extent such policy or endorsement is
available, in an amount determined by Lender in its reasonable discretion (but
in no event greater than the Release Amount applicable to the Individual
Property with the highest then-outstanding Allocated Loan Amount, plus required
business income coverage); provided, however, Borrower shall not
be required to pay annual premiums in excess of $79,667 for such coverage.  The endorsement or policy shall be in form
and substance reasonably satisfactory to Lender and shall meet Rating Agency
criteria for securitized loans; and


 


63

















 


(xii)          upon
sixty (60) days’ notice, such other reasonable insurance and in such reasonable
amounts as Lender from time to time may reasonably request against such other
insurable hazards which at the time are commonly insured against for property
similar to the Property located in or around the region in which the Property
is located, provided such insurance is generally available at commercially
reasonable premiums.


 


(b)           All insurance provided for in Section 5.1.1(a) shall
be obtained under valid and enforceable policies (collectively, the “Policies”
or in the singular, the “Policy”) and, to the extent not specified
above, shall be subject to the approval of Lender as to deductibles, loss
payees and insureds.  Not less than ten (10) days
prior to the expiration dates of the Policies theretofore furnished to Lender,
certificates of insurance evidencing the Policies accompanied by evidence
satisfactory to Lender of payment of the premiums then due thereunder (the “Insurance
Premiums”), shall be delivered by Borrower to Lender.


 


(c)           Borrower shall have the right to effect the coverages
required hereunder under one or more blanket insurance Policies that cover the
Property as well as other properties of Borrower’s Affiliates, provided
that any blanket insurance Policy shall provide substantially the same
protection required hereunder in respect of the Property as would a separate
Policy insuring only the Property in compliance with the provisions of Section 5.1.1(a) taking
into account the geographic diversity of the Property.


 


(d)           All Policies of insurance provided for or contemplated
by Section 5.1.1(a) shall be primary coverage and, except for
the Policy referenced in Section 5.1.1(a)(v) and Section 5.1.1(a)(x),
shall name Borrower as the insured and Lender and its successors and/or assigns
as the additional insured, as its interests may appear, and in the case of
property damage, boiler and machinery, flood, earthquake and terrorism
insurance, shall contain a so-called New York standard non-contributing
mortgagee clause in favor of Lender providing that the loss thereunder shall be
payable to Lender.  Borrower shall not
procure or permit any of its constituent entities to procure any other
insurance coverage which would be on the same level of payment as the Policies
or would adversely impact in any way the ability of Lender or Borrower to
collect any proceeds under any of the Policies.


 


(e)           All Policies of insurance provided for in Section 5.1.1(a),
except for the Policies referenced in Section 5.1.1(a)(v) and (a)(x) shall
contain clauses or endorsements to the effect that:


 


(i)            no act or negligence of Borrower, or
anyone acting for Borrower, or of any Tenant or other occupant, or failure to
comply with the provisions of any Policy, which might otherwise result in a
forfeiture of the insurance or any part thereof, shall in any way affect the
validity or enforceability of the insurance insofar as Lender is concerned;


 


(ii)           the Policy shall not be canceled without
at least thirty (30) days’ written notice to Lender and any other party named
therein as an additional insured and, if obtainable by Borrower using
commercially reasonable efforts, shall not be materially changed (other than to
increase the coverage provided thereby) without such a thirty (30) day notice;
and


 


64

















 


(iii)          Lender
shall not be liable for any Insurance Premiums thereon or subject to any
assessments thereunder.


 


(f)            If at any time Lender is not in receipt of written
evidence that all insurance required hereunder is in full force and effect,
Lender shall have the right, upon ten (10) days prior written notice to
Borrower, to take such action as Lender deems necessary to protect its interest
in the Property, including, without limitation, the obtaining of such insurance
coverage as Lender in its sole discretion deems appropriate and all premiums
incurred by Lender in connection with such action or in obtaining such
insurance and keeping it in effect shall be paid by Borrower to Lender upon
demand and until paid shall be secured by the Mortgage and shall bear interest
at the Default Rate.


 


(g)           in the event of foreclosure of the Mortgage or other
transfer of title to the Property in extinguishment in whole or in part of the
Debt, all right, title and interest of Borrower in and to the Policies that are
not blanket Policies then in force concerning the Property and all proceeds
payable thereunder shall thereupon vest in the purchaser at such foreclosure or
Lender or other transferee in the event of such other transfer of title.


 


5.1.2       Insurance Company. 
The
Policies shall be issued by financially sound and responsible insurance
companies permitted to do business in the State in which each Individual
Property is located.  For so long as five
(5) or more insurance carriers are providing the Policies,
at least sixty percent (60%) of such coverage shall be provided by insurance
companies having a claims paying ability rating of “A-” or better by S&P with the
remaining forty percent (40%) of such coverage being provided by insurance
companies having a claims paying ability rating of “BBB-” or better by S&P;
provided, however, with respect to the first One Hundred Million
and No/100 Dollars ($100,000,000.00) of coverage under such Policies, not more
than twenty percent (20%) of such coverage shall be provided by insurance
companies with a claims paying ability rating lower than “A-” by S&P (but in no event lower than “BBB-” by S&P). 
In the event that four (4) or fewer insurance carriers are
providing the Policies, at least seventy-five percent (75%) of such coverage
shall be provided by insurance companies having a claims paying ability rating
of “A-” or better by S&P, with the remaining twenty-five percent (25%) of
such coverage being provided by insurance companies having a claims paying
ability rating of “BBB-” or better by S&P. 
If a Securitization occurs, (i) the foregoing required insurance
company rating by a Rating Agency not rating any Securities shall be
disregarded and (ii) if the insurance company complies with the aforesaid
S&P required rating (and S&P is rating the Securities) and the other
Rating Agencies rating the Securities do not rate the insurance company, such
insurance company shall be deemed acceptable with respect to such Rating Agency
not rating such insurance company. 
Notwithstanding the foregoing, Borrower shall be permitted to maintain
the Policies with insurance companies which do not meet the foregoing
requirements (an “Otherwise Rated Insurer”), provided Borrower
obtains a “cut-through” endorsement (that is, an endorsement which permits
recovery against the provider of such endorsement) with respect to any
Otherwise Rated Insurer from an insurance company which meets the claims paying
ability ratings required above. 
Moreover, if Borrower desires to maintain insurance required hereunder
from an insurance company which does not meet the claims paying ability ratings
set forth herein but the parent of such insurance company, which owns at least
fifty-one percent (51%) of such insurance company, maintains such ratings,
Borrower may use such insurance companies if approved by the Rating Agencies
(such approval 


 


65

















 


may be conditioned on
items required by the Rating Agencies including a requirement that the parent
guarantee the obligations of such insurance company).


 


5.1.3       Current Insurance. 
Lender
hereby acknowledges that the insurance coverages under the certificates of
insurance delivered to Lender in connection with the execution and delivery of
this Agreement are currently acceptable to Lender as of the date hereof for the
periods covered under the policies described in said certificates for purposes
of this Section 5.1.


 


Section 5.2            Casualty and Condemnation.


 


5.2.1       Casualty.  If any Individual Property shall sustain
a Casualty, Borrower shall give prompt notice of such Casualty to Lender and
shall promptly commence and diligently prosecute to completion the repair and
restoration of such Individual Property as nearly as possible to the condition
such Individual Property was in immediately prior to such Casualty (a “Restoration”)
and otherwise in accordance with Section 5.3, it being
understood, however, that Borrower shall not be obligated to restore such
Individual Property to the precise condition of such Individual Property prior
to such Casualty provided the Individual Property is restored, to the extent
practicable, to be of at least equal value and of substantially the same
character as prior to the Casualty. 
Borrower shall pay all costs of such Restoration whether or not such
costs are covered by insurance.  Lender
may, but shall not be obligated to, make proof of loss if not made promptly by
Borrower.  In the event of a Casualty
where the loss does not exceed the Restoration Threshold, Borrower may settle
and adjust such claim; provided that (a) no Event of Default has
occurred and is continuing and (b) such adjustment is carried out in a
commercially reasonable and timely manner. 
In the event of a Casualty where the loss exceeds the Restoration
Threshold or if an Event of Default then exists, Borrower may settle and adjust
such claim only with the consent of Lender (which consent shall not be
unreasonably withheld or delayed) and Lender shall have the opportunity to
participate, at Borrower’s cost, in any such adjustments.  Notwithstanding any Casualty, Borrower shall
continue to pay the Debt at the time and in the manner provided for its payment
in the Note and in this Agreement.


 


5.2.2       Condemnation. 
Borrower
shall give Lender prompt notice of any actual or threatened Condemnation by any
Governmental Authority of all or any part of any Individual Property and shall
deliver to Lender a copy of any and all papers served in connection with such
proceedings.  Provided no Event of
Default has occurred and is continuing, in the event of a Condemnation where
the amount of the taking does not exceed the Restoration Threshold, Borrower
may settle and compromise such Condemnation; provided that the same is
effected in a commercially reasonable and timely manner.  In the event of a Condemnation where the
amount of the taking exceeds the Restoration Threshold or if an Event of
Default then exists, Borrower may settle and compromise the Condemnation only
with the consent of Lender (which consent shall not be unreasonably withheld or
delayed) and Lender shall have the opportunity to participate, at Borrower’s cost,
in any litigation and settlement discussions in respect thereof and Borrower
shall from time to time deliver to Lender all instruments requested by Lender
to permit such participation.  Borrower
shall, at its expense, diligently prosecute any such proceedings, and shall
consult with Lender, its attorneys and experts, and cooperate with them in the
carrying on or defense of any such proceedings. 
Notwithstanding any Condemnation, Borrower shall continue to pay the Debt
at the time and in the manner provided for its payment in the Note and 


 


66

















 


in this Agreement.  Lender shall not be limited to the interest
paid on the Award by any Governmental Authority but shall be entitled to
receive out of the Award interest at the rate or rates provided herein or in
the Note.  If any Individual Property or
any portion thereof is taken by any Governmental Authority, Borrower shall
promptly commence and diligently prosecute the Restoration of the Property and
otherwise comply with the provisions of Section 5.3.  If any Individual Property is sold by or on
behalf of Lender subsequent to acceleration, through foreclosure or otherwise,
prior to the receipt by Lender of the Award, Lender shall have the right,
whether or not a deficiency judgment on the Note shall have been sought,
recovered or denied, to receive the Award, or a portion thereof sufficient to
pay the Debt.


 


5.2.3       Casualty Proceeds. 
Notwithstanding
the last sentence of Section 5.1.1(a)(iii) and provided no Event of Default exists
hereunder, proceeds received by Lender on account of the business interruption
insurance specified in Section 5.1.l(a)(iii) above with respect to any Casualty shall be
deposited by Lender directly into the Deposit Account (as defined in the Cash
Management Agreement) but (a) only to the extent it reflects a replacement
for (i) lost Rents that would have been due under Leases or Service
Contracts existing on the date of such Casualty, and/or (ii) lost Rents
under Leases or Service Contracts that had not yet been executed and delivered
at the time of such Casualty which Borrower has proven to the insurance company
would have been due under such Leases (and then only to the extent such
proceeds disbursed by the insurance company reflect a replacement for such past
due Rents) and (b) only to the extent necessary to fully make the
disbursements required by Sections 3.3(a)(i) through (vi) of
the Cash Management Agreement.  All other
such proceeds shall be held by Lender and disbursed in accordance with Section 5.3
hereof.


 


Section 5.3            Delivery of Net Proceeds.


 


5.3.1       Minor Casualty or Condemnation. 
If a
Casualty or Condemnation has occurred to any Individual Property and the Net
Proceeds shall be less than the Restoration Threshold and the costs of
completing the Restoration shall be less than the Restoration Threshold, and
provided no Event of Default shall have occurred and remain uncured, the Net
Proceeds will be disbursed by Lender to Borrower.  Promptly after receipt of the Net Proceeds,
Borrower shall commence and satisfactorily complete with due diligence the
Restoration in accordance with the terms of this Agreement.  If any Net Proceeds are received by Borrower
and may be retained by Borrower pursuant to the terms hereof, such Net Proceeds
shall, until completion of the Restoration, be held in trust for Lender and
shall be segregated from other funds of Borrower to be used to pay for the cost
of Restoration in accordance with the terms hereof.


 


5.3.2       Major Casualty or Condemnation.  (a)  If a Casualty or Condemnation has
occurred to any Individual Property and the Net Proceeds are equal to or
greater than the Restoration Threshold or the costs of completing the
Restoration is equal to or greater than the Restoration Threshold, Lender shall
make the Net Proceeds available for the Restoration, provided that each
of the following conditions are met:


 


(i)            no Event of Default shall have occurred
and be continuing;


 


67

















 


(ii)           (A) in the event the Net Proceeds
are insurance proceeds, less than forty percent (40%) of the total floor area
of the Improvements at such Individual Property has been damaged, destroyed or
rendered unusable as a result of such Casualty or (B) in the event the Net
Proceeds are an Award, less than fifteen percent (15%) of the land constituting
such Individual Property is taken, and such land is located along the perimeter
or periphery of such Individual Property, and no portion of the Improvements is
the subject of the Condemnation;


 


(iii)          The
projected aggregate Gross Revenue for the Property after completion of the
Restoration (as reasonably determined by Lender) shall not be reduced as a
result of the occurrence of such Casualty or Condemnation by more than twenty
percent (20%) as compared to the Gross Revenue received by Borrower during the
twelve (12) month period immediately preceding such Casualty or Condemnation.


 


(iv)          Borrower shall commence the Restoration
as soon as reasonably practicable and shall diligently pursue the same to
satisfactory completion;


 


(v)           Lender shall be satisfied that any
operating deficits and all payments of principal and interest under the Note
will be paid during the period required for Restoration from (A) the Net
Proceeds (including sums received from the proceeds of the coverage required
pursuant to Section 5.1.1(a)(iii)), or (B) other funds of
Borrower;


 


(vi)          Lender shall be satisfied that the
Restoration will be completed on or before the earliest to occur of (A) the
date six (6) months prior to the Maturity Date, (B) the earliest date
required for such completion under the terms of any Lease covering 25% or more
of the applicable Individual Property or (C) such time as may be required
under applicable Legal Requirements in order to repair and restore the Property
to the condition it was in immediately prior to such Casualty or to as nearly
as possible the condition it was in immediately prior to such Condemnation, as
applicable;


 


(vii)         such
Individual Property and the use thereof after the Restoration will be in
compliance with and permitted under all applicable Legal Requirements;


 


(viii)        the
Restoration shall be done and completed by Borrower in an expeditious and
diligent fashion and in compliance with all applicable Legal Requirements; and


 


(ix)           such Casualty or Condemnation, as
applicable, does not result in the loss of access to such Individual Property
or the related Improvements (except if the same is effectively replaced).


 


(b)           The Net Proceeds shall be paid directly to Lender and
held by Lender in an interest-bearing account (with such interest being
credited to such account) and, until disbursed in accordance with the
provisions of this Section 5.3.2, shall constitute additional
security for the Debt The Net Proceeds shall be disbursed by Lender to, or as
directed by, Borrower from time to time during the course of the Restoration,
upon receipt of evidence satisfactory to Lender that (A) all requirements
set forth in Section 5.3.2(a) have been satisfied, (B) all
materials installed and work and labor performed (except to the extent that
they are to be 


 


68

















 


paid for out of the
requested disbursement) in connection with the Restoration have been paid for
in full, and (C) there exist no notices of pendency, stop orders, mechanic’s
or materialman’s liens or notices of intention to file same, or any other liens
or encumbrances of any nature whatsoever on the Individual Property arising out
of the Restoration which have not been fully bonded to the reasonable
satisfaction of Lender, discharged of record or fully insured to the reasonable
satisfaction of Lender by the title company issuing the Title Insurance Policy
(or another reputable title company satisfactory to Lender).


 


(c)           The Restoration shall be completed in a first class
workmanlike manner at least equivalent to the quality and character of the
original work in the Improvements (provided, however, that in the
case of a partial Condemnation, the Restoration shall be done to the extent
reasonable practicable after taking into account the consequences of such
partial Condemnation), so that upon completion thereof, the Individual Property
shall be at least equal in value and general utility to such Individual
Property prior to the damage or destruction; it being understood, however, that
Borrower shall not be obligated to restore the Individual Property to the
precise condition of such Individual Property prior to such Casualty provided
the Individual Property is restored, to the extent practicable, to be of at
least equal value and of substantially the same character as prior to the
Casualty.  Borrower shall restore all
Improvements such that when they are fully restored and/or repaired, such
Improvements and their contemplated use fully comply with all applicable
material Legal Requirements.  All
reasonable out-of-pocket costs and expenses incurred by Lender in connection
with recovering, holding and advancing the Net Proceeds for the Restoration
including, without limitation, reasonable attorneys’ fees and disbursements and
the Casualty Consultant’s fees and
disbursements, shall be paid by Borrower.


 


(d)           In no event shall Lender be obligated to make
disbursements of the Net Proceeds in excess of an amount equal to the costs
actually incurred from time to time for work in place as part of the
Restoration, as certified by Borrower, less the Casualty Retainage.  The term “Casualty  Retainage”
shall mean, as to each contractor, subcontractor or materialman engaged in the
Restoration, an amount equal to ten percent (10%) of the costs actually
incurred for work in place as part of the Restoration, as certified by
Borrower, until the Restoration has been completed.  The Casualty Retainage shall in no event, and
notwithstanding anything to the contrary set forth above in this Section 5.3.2(d),
be less than the amount actually held back by Borrower from contractors,
subcontractors and materialmen engaged in the Restoration.  The Casualty Retainage shall not be released
until Borrower certifies to Lender that the Restoration has been completed in
accordance with the provisions of this Section 5.3.2(d) and
that all approvals necessary for the re-occupancy and use of the Property have
been obtained from all appropriate Governmental Authorities, and Lender
receives evidence satisfactory to Lender that the costs of the Restoration have
been paid in full or will be paid in full out of the Casualty Retainage; provided,
however, that Lender will release the portion of the Casualty Retainage
being held with respect to any contractor, subcontractor or materialman engaged
in the Restoration as of the date upon which Borrower certifies to Lender that
the contractor, subcontractor or materialman has substantially completed all
work in a satisfactory manner and has supplied all materials in accordance with
the provisions of the contractor’s, subcontractor’s or rnaterialman’s contract,
the contractor, subcontractor or rnaterialman delivers the lien waivers and
evidence of payment in full of all sums due to the contractor, subcontractor or
materialman as may be reasonably requested by Lender or by the title company
issuing the Title Insurance Policy (or another reputable title company
satisfactory to Lender), and Lender receives an 


 


69

















 


endorsement to the Title
Insurance Policy insuring the continued priority of the lien of the Mortgage
and evidence of payment of any premium payable for such endorsement.  If required by Lender, the release of any such
portion of the Casualty Retainage shall be approved by the surety company, if
any, which has issued a payment or performance bond with respect to the
contractor, subcontractor or materialman.


 


(e)           Lender shall not be obligated to make disbursements of
the Net Proceeds more frequently than once every calendar month.


 


(f)            If at any time the Net Proceeds or the undisbursed
balance thereof shall not, in the reasonable opinion of Lender be sufficient to
pay in full the balance of the costs which are reasonably estimated by the
Casualty Consultant to be incurred in connection with the completion of the
Restoration, Borrower shall deposit 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 and shall be disbursed for costs actually
incurred in connection with the Restoration on the same conditions applicable
to the disbursement of the Net Proceeds, and until so disbursed pursuant to
this Section 5.3.2 shall constitute additional security for the
Debt.


 


(g)           The excess, if any, of the Net Proceeds and the
remaining balance, if any, of the Net Proceeds Deficiency deposited with Lender
after the Casualty Consultant certifies to Lender that the Restoration has been
completed in accordance with the provisions of this Section 5.3.2,
and the receipt by Lender of evidence satisfactory to Lender that all costs
incurred in connection with the Restoration have been paid in full, shall be
remitted by Lender to Borrower, provided no Event of Default shall have
occurred and shall be continuing under any of the Loan Documents.


 


(h)           Subject to Borrower’s rights pursuant to Section 2.4.2,
all Net Proceeds not required (i) to be made available for the Restoration
or (ii) to be returned to Borrower as excess Net Proceeds pursuant to Section 5.3.2(g) may
be retained and applied by Lender toward the payment of the Debt, whether or
not then due and payable, in such order, priority and proportions as Lender in
its sole discretion shall deem proper, or, at the discretion of Lender, the
same may be paid, either in whole or in part, to Borrower for such purposes as
Lender shall designate.


 


(i)            Notwithstanding anything to the contrary contained
herein, from and after the occurrence of a Casualty or Condemnation, if (1) any
Lease of all or any portion of an Individual Property covering at least 25% of the total square footage of
such Individual Property and/or any contract for services at an Individual
Property (a “Service Contract”) for which the payments thereunder
constitute at least 25% of the
Gross Revenue generated by such Individual Property requires Borrower to
restore such Individual Property after such Casualty or Condemnation, (2) no
default (beyond any applicable notice and/or grace periods) shall have occurred
and be continuing under such Lease or Service Contract and (3) no Event of
Default shall have occurred and be continuing, then  Lender
shall disburse the Net Proceeds or Award in accordance with the disbursement
provisions specified in Section 5.3.2(b)-(g) to Borrower
(without Borrower having to satisfy the conditions specified in Section 5.3.2(a))
to facilitate Borrower’s compliance therewith.


 


70














 


VI.           RESERVE
FUNDS


 


Section 6.1            Required Repairs.


 


6.1.1       Required Repairs and Deposit of
Required Repair Funds.  Borrower shall perform the repairs and
the remediations at the Property, as more particularly set forth on Schedule II
hereto (such repairs and remediations hereinafter collectively referred to as “Required
Repairs”).  Borrower shall complete
the Required Repairs at each Individual Property by the required deadline for
each repair or remediation as set forth on Schedule II, subject to
Excusable Delays.  In the event that any
amounts are required to be deposited pursuant to Section 11.29(i),
such amounts, together with interest earned thereon, shall be referred to as
the “Required Repair Funds”.


 


6.1.2       Release of Required Repair Funds.  (a)  Lender shall direct Agent to disburse
Required Repair Funds only for Required Repairs.


 


(b)           Lender shall direct Agent to disburse
Required Repair Funds upon satisfaction by Borrower of each of the following
conditions: (i) Borrower shall submit a request for payment to Lender at
least ten (10) days prior to the date on which Borrower requests such
payment be made and specifies the Required Repairs to be paid, (ii) on the
date such request is received by Lender and on the date such payment is to be
made, no Event of Default shall exist and remain uncured, (iii) Lender
shall have received a certificate from Borrower (A) stating that the items
to be funded by the requested disbursement are Required Repairs, (B) stating
that all Required Repairs at the Property to be funded by the requested
disbursement have been performed to date in a good and workmanlike manner and
in accordance with all applicable Legal Requirements, such certificate to be
accompanied by a copy of any license, permit or other approval required by any
Governmental Authority in connection with the Required Repairs, (C) identifying
each Person that supplied materials or labor in connection with the Required Repairs to be
funded by the requested disbursement, and (D) stating that each such
Person has been paid amounts then due or will be
paid such amount upon
such disbursement, such certificate to be accompanied by lien waivers or other
evidence of payment reasonably satisfactory to Lender, (iv) at Lender’s
option, a title search for the Individual Property at which such Required
Repairs are being performed indicating that such Individual Property is free
from all Liens, claims and other encumbrances not previously approved by
Lender, (v) at Lender’s option, if the cost of any individual Required
Repair exceeds $750,000, Lender shall have received a report satisfactory to
Lender in its  reasonable discretion from an
architect, engineer or consultant approved (which approval shall not be
unreasonably withheld, conditioned or delayed) by Lender in respect of such
architect’s, engineer’s or consultant’s inspection of the Required Repairs, and
(vi) Lender shall have received such other evidence as Lender shall
reasonably request that the portion of the Required Repairs to be funded by the
requested disbursement have been performed to date and are paid for or will be
paid upon such disbursement to Borrower. 
Lender shall not be required to disburse Required Repair Funds more
frequently than once each calendar month, unless such requested disbursement is
in an amount greater than the Minimum Disbursement Amount (or a lesser amount
if the total amount of Required Repair Funds is less than the Minimum
Disbursement Amount, in which case only one disbursement of the amount
remaining in the account shall be made).


 


71

















 


(c)           Nothing in this Section 6.1.2
shall (i) make Lender responsible for performing or completing the
Required Repairs; (ii) require Lender to expend funds in addition to the
Required Repair Funds to complete any Required Repairs; (iii) obligate
Lender to proceed with the Required Repairs; or (iv) obligate Lender to
demand from Borrower additional sums to complete any Required Repairs.


 


(d)           Borrower shall permit Lender and
Lender’s agents and representatives (including, without limitation, Lender’s
engineer, architect, inspector or consultant) or third parties to enter onto
the Property during normal business hours (subject to the rights of Tenants
under their Leases) to inspect the progress of any Required Repairs and all
materials being used in connection therewith and to examine, if applicable, all
plans and shop drawings relating to such Required Repairs.  Prior to the occurrence of an Event of
Default such entry and inspection shall be conducted in a manner that minimizes
any interference with Borrower’s business or the use and enjoyment of the
Property by Borrower, Borrower’s tenants and Borrower’s tenants’ customers and
guests.  Borrower shall cause all
contractors and subcontractors to cooperate with Lender Or Lender’s representatives or such other
Persons described above in connection with inspections described in this Section 6.1.2(d).


 


(e)           If a disbursement for any single
Required Repair at an Individual Property will exceed $750,000, Lender may
require an inspection of the Property at Borrower’s expense prior to making a
disbursement of Required Repair Funds, and in connection therewith, such entry
and inspection shall be conducted in a manner that minimizes any interference
with Borrower’s business or the use and enjoyment of the Property by Borrower,
Borrower’s tenants and Borrower’s tenants’ customers and guests.  Lender may require that such inspection be
conducted by an appropriate independent qualified professional selected by
Lender and may require a certificate of completion by an independent qualified
professional engineer, architect or consultant acceptable to Lender prior to
the disbursement of such Required Repair Funds. 
Borrower shall pay the reasonable out-of-pocket expense of the inspection
as required hereunder, whether such inspection is conducted by Lender or by an
independent qualified professional engineer, architect or consultant.


 


(f)            In the event Lender releases an
Individual Property (or assigns the Mortgage encumbering such Individual
Property) as a result of the exercise of Borrower’s rights under Section 2.4
or Section 2.5 hereof, Lender shall direct Agent,
and Agent shall, promptly following the release of the Lien of the Mortgage (or
the assignment of the Mortgage) with respect to such Individual Property,
deliver, or cause the delivery, to Borrower from the Required Repair Funds an
amount equal to the undisbursed portion of the Required Repair Funds deposited
by Borrower with respect to the Required Repairs to be performed on such
Individual Property.


 


Section 6.2            Tax Funds.


 


6.2.1       Deposits of Tax Funds.  Pursuant to the Cash Management Agreement, upon the
occurrence of (a) a Trigger Event and during the continuance of a Trigger
Period or (b) an Event of Default and during the continuance thereof,
there shall be deposited with Agent on each Monthly Payment Date an amount
equal to one-twelfth of the Taxes that Lender reasonably estimates will be
payable during the next ensuing twelve (12) months in order to accumulate 


 


72

















 


sufficient funds to pay
all such Taxes at least ten (10) days prior to their respective due
dates.  Amounts deposited pursuant to
this Section 6.2.1, together with interest earned thereon, are
referred to herein as the “Tax Funds”. 
If at any time Lender reasonably determines that the Tax Funds will not
be sufficient to pay the Taxes, Lender shall notify Borrower of such
determination and the monthly deposits for Taxes shall be increased by the
amount that Lender estimates is sufficient to make up the deficiency at least
fifteen (15) days prior to the respective due dates for the Taxes; provided
that if Borrower receives notice of any deficiency after the date that is
fifteen (15) days prior to the date that Taxes are due, Borrower will deposit
such amount within three (3) Business Days after its receipt of such
notice.


 


6.2.2       Release of Tax Funds.  Lender shall have the right to apply the Tax Funds to
payment of Taxes (and, at Borrower’s request, which shall be made not later
than ten (10) days prior to the date the applicable payment of Taxes is
due, Lender shall apply the Tax Funds to such payment of Taxes, provided that
no Event of Default has occurred and is continuing).  In making any payment relating to Taxes, Lender
may do so according to any bill, statement or estimate procured from the appropriate public office (with respect to
Taxes) without inquiry into the accuracy of such bill, statement or estimate or
into the validity of any tax, assessment, sale, forfeiture, tax lien or title
or claim thereof.  If the amount of the
Tax Funds shall exceed the amounts due for Taxes, Lender shall, in its sole
discretion, return any excess to Borrower or credit such excess against future
payments to be made to the Tax Funds. 
Any Tax Funds remaining after the Debt has been paid in full shall be
returned to Borrower.  In the event
Lender releases an Individual Property (or assigns the Mortgage encumbering
such Individual Property) as a result of the exercise of Borrower’s rights
under Section 2.4 or Section 2.5 hereof,
Lender shall direct Agent, and Agent shall, promptly following the release of
the Lien of the Mortgage (or the assignment of the Mortgage) with respect to
such Individual Property, deliver, or cause the delivery, to Borrower from the
Tax Funds an amount equal to the Tax Funds deposited by Borrower into the Tax
Account with respect to such Individual Property (to the extent such Tax Funds
are in excess of the Tax Funds that will be required to be reserved in the Tax
Account with respect to the Property (excluding such Individual Property)).


 


Section 6.3            Insurance Funds.


 


6.3.1       Deposits of Insurance Funds.  Pursuant to the Cash Management Agreement, upon the
occurrence of (a) a Trigger Event and during the continuance of a Trigger
Period or (b) an Event of Default and during the continuance thereof,
there shall be deposited with Agent on each Monthly Payment Date an amount
equal to one-twelfth of the Insurance Premiums that Lender reasonably estimates
will be payable for the renewal of the coverage afforded by the Policies upon
the expiration thereof in order to accumulate sufficient funds to pay all such
Insurance Premiums at least thirty (30) days prior to the expiration of the
Policies.  Amounts deposited pursuant to
this Section 6.3.1 are referred to herein as the “Insurance
Funds”. If at any time Lender reasonably determines that the Insurance
Funds will not be sufficient to pay the Insurance Premiums, Lender shall notify
Borrower of such determination and the monthly deposits for Insurance Premiums
shall be increased by the amount that Lender estimates is sufficient to make up
the deficiency at least thirty (30) days prior to expiration of the Policies;
provided that if Borrower receives notice of any deficiency after the date that
is thirty (30) days prior to the expiration date of the Policies, Borrower will
deposit such
amount within three (3) Business Days after its receipt of such
notice.  Notwithstanding the foregoing
provisions of this 


 


73

















 


Section 6.3.1, if insurance coverages required
hereunder are effected under one or more blanket insurance Policies in
accordance with the terms set forth in Section 5.11(c), Borrower
shall not be required to make deposits under this Section 6.3.1, provided
that Borrower delivers to Lender certificates of insurance evidencing such
blanket insurance Policies, together with evidence reasonably satisfactory to
Lender that the premiums for such blanket insurance Policies have been paid,
and if such Policies are to expire within thirty (30) days, that the premiums
with respect to such blanket Policies for the next succeeding period have been
paid.


 


6.3.2       Release of Insurance Funds.  Lender shall have the right to apply the Insurance
Funds to payment of Insurance Premiums (and, at Borrower’s request, which shall
be made not later than ten (10) days prior to the date the applicable
payment of Insurance Premiums is due, Lender shall apply the Insurance Funds to
such payment of Insurance Premiums, provided that no Event of Default
has occurred and is continuing).  In
making any payment relating to Insurance Premiums, Lender may do so according
to any bill, statement or estimate procured from the insurer or its agent, without
inquiry into the accuracy of such bill, statement or estimate.  If the amount of the Insurance Funds shall
exceed the amounts due for Insurance Premiums, Lender shall, in its sole
discretion, return any excess to Borrower or credit such excess against future
payments to be made to the Insurance Funds. 
Any Insurance Funds remaining after the Debt has been paid in full shall
be returned to Borrower.  In the event
Lender releases an Individual Property (or assigns the Mortgage encumbering
such Individual Property) as a result of the exercise of Borrower’s rights
under Section 2.4 or Section 2.5 hereof, Lender shall
direct Agent, and Agent shall, promptly following the release of the Lien of
the Mortgage (or the assignment of the Mortgage) with respect to such
Individual Property, deliver, or cause the delivery, to Borrower from the
Insurance Funds an amount equal to the Insurance Funds deposited by Borrower
into the Insurance Account with respect to such Individual Property (to the
extent such Insurance Funds are in excess of the Insurance Funds that will be
required to be reserved in the Insurance Account with respect to the Property
(excluding such Individual Property)).


 


Section 6.4            Capital Expenditure Funds.


 


6.4.1       Deposits of Capital Expenditure Funds.  Pursuant to the Cash Management Agreement, upon (a) the
occurrence of a Trigger Event and during the continuance of a Trigger Period or
(b) the occurrence of an Event of Default and during the continuance
thereof, Borrower shall deposit with Agent on each Monthly Payment Date an
amount equal to the lesser of (a) one-twelfth of the product of $0.03 and
the number of cubic feet of space at the Property (it being agreed that, as of
the date hereof there is 32,841,000 cubic feet of space at the Property
comprised of the number of cubic feet at each Individual Property set forth on Schedule
VI) and (b) the amount necessary to bring the amount of Capital
Expenditure Funds in the Capital Expenditure Account to the Capital Expenditure
Maximum Amount, which amounts shall be for Capital Expenditures.  Amounts deposited pursuant to this Section 6.4.1,
together with interest earned thereon, are referred to herein as the “Capital
Expenditure Funds”.


 


6.4.2       Release of Capital Expenditure Funds.  (a)  Lender shall direct Agent to disburse Capital
Expenditure Funds only for Capital Expenditures Work.


 


74

















 


(b)           Lender shall direct Agent to disburse
to Borrower the Capital Expenditure Funds upon satisfaction by Borrower of each
of the following conditions: (i) Borrower shall submit a request for
payment to Lender at least ten (10) days prior to the date on which
Borrower requests such payment be made and specifies the Capital Expenditures
Work to be paid, (ii) on the date such request is received by Lender and
on the date such payment is to be made, no Event of Default shall exist and
remain uncured, (iii) Lender shall have received a certificate from
Borrower (A) stating that the items to be funded by the requested
disbursement are Capital Expenditures Work, (B) stating that all Capital
Expenditures Work at the Property to be funded by the requested disbursement
have been performed to date in a good and workmanlike manner and in accordance
with all applicable Legal Requirements, such certificate to be accompanied by a
copy of any license, permit or other approval required by any Governmental
Authority in connection with the Capital Expenditures Work, (C) identifying
each Person that supplied materials or labor in connection with the Capital
Expenditures Work to be funded by the requested disbursement, and (D) stating
that each such Person has been paid amounts then due or will be paid such
amount upon such disbursement, such certificate to be accompanied by lien
waivers or other evidence of payment reasonably satisfactory to Lender, (iv) at
Lender’s option, a title search for the Individual Property at which such
Capital Expenditures Work are being performed indicating that such Individual
Property is free from all Liens, claims and other encumbrances not previously
approved by Lender, (v) intentionally omitted, and (vi) Lender shall
have received such other evidence as Lender shall reasonably request that the
portion of the Capital Expenditures Work at the Property to be funded by the
requested disbursement have been performed to date and are paid for or will be
paid upon such disbursement to Borrower. 
Lender shall not be required to disburse Capital Expenditure Funds more
frequently than once each calendar month, unless such requested disbursement is
in an amount greater than the Minimum Disbursement Amount (or a lesser amount
if the total amount of Capital Expenditure Funds is less than the Minimum
Disbursement Amount, in which case only one disbursement of the amount
remaining in the account shall be made).


 


(c)           Nothing in this Section 6.42
shall (i) make Lender responsible for making or completing the Capital
Expenditures Work; (ii) require Lender to expend funds in addition to the
Capital Expenditure Funds to complete any Capital Expenditures Work; (iii) obligate
Lender to proceed with the Capital Expenditures Work; or (iv) obligate
Lender to demand from Borrower additional sums to complete any Capital
Expenditures Work.


 


(d)           Borrower shall permit Lender and
Lender’s agents and representatives (including, without limitation, Lender’s
engineer, architect, or inspector) or third parties to enter.  onto the Property during normal business
hours (subject to the rights of Tenants under their Leases) to inspect the
progress of any Capital Expenditures Work and all materials being used in
connection therewith and to examine (if applicable) all plans and shop drawings
relating to such Capital Expenditures Work. 
Prior to the occurrence of an Event of Default, such entry and
inspection shall be conducted in a manner that minimizes any interference with
Borrower’s business or the use and enjoyment of the Property by Borrower,
Borrower’s tenants and Borrower’s tenants’ customers and guests.  Borrower shall cause all contractors and
subcontractors to cooperate with Lender or Lender’s representatives or such
other Persons described above in connection with inspections described in this Section 6.4.2(d).


 


75

















 


(e)           If a disbursement with respect to any
Individual Property will exceed fifteen percent (15%) of the Allocated Loan
Amount for such Individual Property, Lender may require an inspection of such
Individual Property at Borrower’s expense prior to making a disbursement of
Capital Expenditure Funds in connection therewith.  Such entry and inspection shall be conducted
in a manner that minimizes any interference with Borrower’s business or the use
and enjoyment of the affected Individual Property by Borrower, Borrower’s
tenants and Borrower’s tenants’ customers and guests.  Lender may require that such inspection be
conducted by an appropriate independent qualified professional selected by
Lender and may require a certificate of completion by an independent qualified
professional architect, engineer or consultant reasonably acceptable to Lender
prior to the disbursement of such Capital Expenditure Funds.  Borrower shall pay the reasonable
out-of-pocket expense of the inspection as required hereunder, whether such
inspection is conducted by Lender or by an independent qualified professional
architect, engineer or consultant.


 


(f)            In addition to any insurance
required under the Loan Documents, Borrower shall provide or cause to be
provided workmen’s compensation insurance, builder’s risk, and public liability
insurance and other insurance to the extent required under applicable law in
connection with Capital Expenditures Work. 
All such policies shall be in form and amount reasonably satisfactory to
Lender.


 


(g)           In the event Lender releases an
Individual Property (or assigns the Mortgage encumbering such Individual
Property) as a result of the exercise of Borrower’s rights under Section 2.4,
Section 2.5 or Section 11.29 hereof, Lender shall
direct Agent, and Agent shall, promptly following the release of the Lien of
the Mortgage (or the assignment of the Mortgage) with respect to such
Individual Property, deliver, or cause the delivery, to Borrower from the
Capital Expenditure Funds an amount equal to the Capital Expenditure Funds on
deposit which are in excess of the Capital Expenditure Maximum Amount (as
reduced due to such release), and the amount required to be deposited pursuant
to Section 6.4.1 shall be reduced proportionately to reflect the
reduced cubic footage of such released Individual Property.


 


Section 6.5            Borrower Cash Collateral Funds.


 


6.5.1       Deposits of Borrower Cash Collateral
Funds.  From and after the occurrence of a Cash
Trap Event and during the continuance of a Cash Trap Period, Borrower shall
deposit with Agent all of the Borrower Excess Cash Flow (the “Borrower Cash
Collateral Funds”).


 


6.5.2       Release of Borrower Cash Collateral
Funds.  All Borrower Cash Collateral Funds on
deposit shall be released by Lender in accordance with the Cash Management
Agreement when Lender determines that a Cash Trap Period no longer exists.


 


Section 6.6            Intentionally Omitted.


 


Section 6.7            Intentionally Omitted.


 


Section 6.8            Application of Reserve Funds.  Upon the occurrence and during the continuance of an
Event of Default, Lender, at its option, may withdraw the Reserve Funds and
apply the Reserve Funds to the items for which the Reserve Funds were
established or to 


 


76

















 


payment of the Debt in
such order, proportion and priority as Lender may determine in its sole
discretion.  Lender’s right to withdraw
and apply the Reserve Funds shall be in addition to all other rights and
remedies provided to Lender under the Loan Documents.


 


Section 6.9            Security Interest in Reserve Funds.


 


6.9.1       Grant of Security Interest.  Borrower shall be the owner of the funds on deposit in
the Accounts.  Borrower hereby pledges,
assigns and grants a security interest to Lender, as security for payment of
the Debt and the performance of all other terms, conditions and covenants of
the Loan Documents on Borrower’s part to be paid and performed, in all of
Borrower’s right, title and interest in and to the funds on deposit in the
Accounts.  The Reserve Funds shall be
under the sole dominion and control of Lender, and Lender shall hold the
Reserve Funds now or hereafter deposited in the Accounts subject to the terms
of this Agreement and the Cash Management Agreement.  Notwithstanding anything to the contrary
contained herein or in the Cash Management Agreement or any other Loan
Document, Lender shall have no security interest or Lien in any funds disbursed
to Borrower in accordance with the Cash Management Agreement following such
disbursement.


 


6.9.2       Income Taxes.  The Reserve Funds shall be held in an interest-bearing
account and invested in Permitted Investments in accordance with the terms of
the Cash Management Agreement.  Borrower
shall report on its federal, state and local income tax returns all interest or
income accrued on the Reserve Funds.


 


6.9.3       Prohibition Against Further
Encumbrance.  Borrower shall not, without the prior
consent of Lender, further pledge, assign or grant any security interest in the
Reserve Funds or permit any lien or encumbrance to attach thereto, or any levy
to be made thereon, or any UCC-1 Financing Statements, except those naming Lender
as the secured party, to he filed with respect thereto.


 


Section 6.10         Intentionally Omitted.


 


Section 6.11         Provisions Regarding Letters of Credit.


 


6.11.1     Security for Debt.  Each Letter of Credit delivered under this Agreement
shall be additional security for the payment of the Debt.  Upon the occurrence and during the
continuance of an Event of Default, Lender shall have the right, at its option,
to draw on any Letter of Credit and to apply all or any part thereof to the
payment of the items for which such Letter of Credit was established or to
apply each such Letter of Credit to payment of the Debt in such order,
proportion or priority as Lender may determine. 
Any such application to the Debt shall be subject to the terms set forth
in Section 2.3.3 and Section 2.4.3.  On the Maturity Date, any such Letter of
Credit may be applied to reduce the Debt.


 


6.11.2     Additional Rights of Lender.  In addition to any other right Lender may have to draw
upon a Letter of Credit pursuant to the terms and conditions of this Agreement,
Lender shall have the additional rights to draw in full any Letter of Credit: (a) with
respect to any evergreen Letter of Credit, if Lender has received a notice from
the issuing bank that the Letter of Credit will not be renewed and a substitute
Letter of Credit is not provided at least thirty (30) days prior to the date on
which the outstanding Letter of Credit is scheduled to expire; (b) with 


 


77

















 


respect to any Letter of
Credit with a stated expiration date, if Lender has not received a notice from
the issuing bank that it has renewed the Letter of Credit at least thirty (30) days
prior to the date on which such Letter of Credit is scheduled to expire and a
substitute Letter of Credit is not provided at least thirty (30) days prior to
the date on which the outstanding Letter of Credit is scheduled to expire; (c) upon
receipt of notice from the issuing
bank that the Letter of Credit will be terminated (except if the termination of
such Letter of Credit is permitted pursuant to the terms and conditions of this
Agreement or a substitute Letter of Credit is provided); or (d) if Lender
has received notice that the bank issuing the Letter of Credit shall cease to
be an Eligible Institution, and Borrower shall have failed to provide a
replacement Letter of Credit within five (5) Business Days thereof.  Notwithstanding anything to the contrary
contained in the above, Lender is not obligated to draw any Letter of Credit
upon the happening of an event
specified in (a), (b), (c) or (d) above and shall not be liable for
any losses sustained by Borrower due to the insolvency of the bank issuing the
Letter of Credit if Lender has not drawn the Letter of Credit.  If any Letter of Credit proceeds shall be
disbursed to Lender hereunder, Borrower shall thereafter be permitted to
deliver to Lender, as a replacement for such cash proceeds, either a Letter of
Credit or Reserve Guaranty in the amount of the cash proceeds then remaining
after application in accordance with the terms hereof, and Lender shall
promptly disburse such remaining cash proceeds to Borrower upon its receipt of
such replacement Letter of Credit or Reserve Guaranty.


 


Section 6.12         Guaranty or Letter of Credit in Lieu of
Cash Deposit.  (a)  In  lieu
of making cash deposits of Required Repair Funds, Tax Funds, Insurance Funds
and/or Capital Expenditure Funds, Borrower may deliver to Lender one or more of
the following: (i) a guaranty from Guarantor in form and substance
reasonably acceptable to Lender (a “Reserve Guaranty”) or (ii) a
Letter of Credit in accordance with the provisions of this Section 6.12.  Borrower shall be responsible for the payment
of all reasonable out-of-pocket costs and expenses incurred by the Servicer in
the administration of any Letter of Credit or Reserve Guaranty delivered
pursuant to this Section 6.12.


 


(b)           In the event Borrower elects to
deliver a Letter of Credit in lieu of making cash deposits of Required Repair
Funds, Tax Funds, Insurance Funds and/or Capital Expenditure Funds, the
aggregate amount of any Letter of Credit, Reserve Guaranty and/or cash on
deposit with respect to the Required Repair Funds, Tax Funds, Insurance Funds
and/or Capital Expenditure Funds shall at all times be at least equal to the
aggregate amount which Borrower is required to have on deposit in such Reserve
Fund(s) pursuant to this Agreement. 
The aggregate amount of any Letter of Credit, Reserve Guaranty and/or
cash on deposit with respect to the Tax Funds shall at all times be at least equal
to the aggregate which Borrower would be required to deposit in such Reserve
Fund over the next twelve (12) month period. 
The aggregate amount of any Letter of Credit, Reserve Guaranty and/or
cash on deposit with respect to the Insurance Funds shall at all times be at
least equal to the aggregate which Borrower would be required to deposit in
such Reserve Fund over the next twelve (12) month period.  In the event that a Letter of Credit and/or
Reserve Guaranty is delivered in lieu of any portion of the Tax Funds or the
Insurance Funds, Borrower shall be responsible for the payment of Taxes or
Insurance Premiums, as applicable, and Lender shall not be responsible
therefor.


 


(c)           Borrower shall give Lender no less
than thirty (30) days notice of Borrower’s election to deliver a Letter of
Credit pursuant to this Section 6.12 Borrower shall pay to Lender
all of Lender’s reasonable out-of-pocket costs and expenses in connection
therewith.  


 


78

















 


Borrower shall not be
entitled to draw from any such Letter of Credit.  Upon thirty (30) days notice to Lender,
Borrower may replace a Letter of Credit theretofore delivered to Lender
pursuant to this Section 6.12 with a cash deposit to the applicable
Reserve Fund and/or with a Reserve Guaranty. 
Prior to such replacement of a Letter of Credit, to the extent same is
not replaced with a Reserve Guaranty, Borrower shall deposit an amount equal to
the amount that would have accumulated in the applicable Reserve Fund and not
been disbursed in accordance with this Agreement if such Letter of Credit had
not been delivered.


 


(d)           Borrower shall provide Lender with
notice of any increases in the annual payments for Taxes and Insurance Premiums
thirty (30) days prior to the effective date of any such increase and any
applicable Letter of Credit under this Section 6.12 shall be
increased by such increased amount at least ten (10) days prior to the
effective date of such increase (unless such increase is covered by cash or a
Reserve Guaranty).


 


VII.         PROPERTY
MANAGEMENT


 


Section 7.1            The
Management Agreement.  Borrower shall cause any Manager to
manage the Property in accordance with the Management Agreement.  Borrower shall (i) diligently perform
and observe all of the material terms, covenants and conditions of the
Management Agreement on the part of Borrower to be performed and observed, (ii) promptly
notify Lender of any notice to Borrower of any default by Borrower in the
performance or observance of any of the terms, covenants or conditions of the
Management Agreement on the part of Borrower to be performed and observed, and (iii) if
Manager is not an Affiliate of Borrower, promptly deliver to Lender a copy of
each financial statement, business plan, capital expenditures plan, report and
estimate received by it under the Management Agreement.  If Borrower shall default in the performance
or observance of any material term, covenant or condition of any Management
Agreement on the part of Borrower to be performed or observed, then, without
limiting Lender’s other rights or remedies under this Agreement or the other
Loan Documents, and without waiving or releasing Borrower from any of its
obligations hereunder or under the Management Agreement, Lender shall have the
right, but shall be under no obligation, to pay any sums and to perform any act
as may be appropriate to cause all the material terms, covenants and conditions
of the Management Agreement on the part of Borrower to be performed or
observed.


 


Section 7.2            Prohibition Against Termination or
Modification.  Borrower shall not (i) surrender,
terminate or cancel any Management Agreement, unless (A) Borrower has
advised Lender of its intention to terminate the Manager, (B) the
replacement manager has delivered to Lender copies of an Assignment of
Management Agreement and a cash management agreement in substantially the form
of the Cash Management Agreement in each case executed by Borrower and
replacement manager and (C) the replacement manager is a Qualified
Manager, (ii) modify any Management Agreement in such a way that would
have a material adverse effect on the use, operation or value of the Property
or the ability of Borrower to pay its obligations in respect of the Loan, (iii) enter
into any other agreement with any Person for such Person to act as the manager
or operator of the Property, except as provided in this Section 7.2,
or (iv) consent
to the Transfer by the Manager of its interest under the Management Agreement
except as provided in this Section 7.2, in each case without the express
consent of Lender, which consent shall not be unreasonably withheld; provided,
however, with respect to a new manager (other than a 


 


79

















 


Qualified Manager), such
consent may be conditioned upon Borrower delivering a Rating Agency
Confirmation as to such new manager and management agreement.  If at any time Lender consents to the
appointment of a new manager, or a new manager is appointed without Lender’s
consent being required, (a) such new manager and Borrower shall, as a
condition of Lender’s consent, if required, execute an Assignment of Management
Agreement and a cash management agreement in substantially the form of the Cash
Management Agreement and (b) if such new manager is an Affiliate of Borrower,
Borrower shall deliver a non-consolidation opinion acceptable to the Rating
Agencies.


 


Section 7.3            Replacement of Manager.  Lender shall have the right to require Borrower to
replace any Manager with a Person which is not an Affiliate of, but is chosen
by, Borrower and approved by Lender (which approval, in the case of a
replacement due to the circumstances described in subsections (ii) and/or (iii) of
this Section 7.3, shall not be unreasonably withheld, conditioned
or delayed) upon the occurrence of any one or more of the following events: (i) at
any time following the acceleration of the Loan by Lender, (ii) if Manager
shall be in material default under the Management Agreement beyond any
applicable notice and cure period and/or (iii) if at any time the Manager
has engaged in gross negligence, fraud or willful misconduct.


 


Section 7.4            The Cash Management Agency
Agreement.  Lender shall have the right to require
Borrower to terminate the Cash Management Agency Agreement upon the occurrence
of any one or more of the following events: (i) at any time following the
acceleration of the Loan by Lender, (ii) if Borrower’s counterparty to the
Cash Management Agency Agreement shall
be in material default thereunder beyond any applicable notice and cure
period and/or (iii) if at any time such counterparty has engaged in gross
negligence, fraud or willful misconduct.


 


VIII.        PERMITTED
TRANSFERS


 


Section 8.1            Permitted Transfer of Property. 
The Loan may not be assumed in connection with a Transfer of the
Property until the earlier of (i) the date on which one or more Secondary
Market Transactions have been effected resulting in UBS Real Estate Securities
Inc.  or its Affiliates holding none of
the Loan and (ii) the first anniversary of the date hereof.  Thereafter, Lender’s consent to a Transfer of
the Property and assumption of the Loan, or to a Transfer of all of the
interests in Borrower, which Transfer is otherwise prohibited hereunder, shall
not be unreasonably withheld, provided that the following requirements
are satisfied:


 


(a)           Lender receives sixty (60) days prior
written notice of such Transfer;


 


(b)           no Event of Default has occurred and
is continuing and no Default or Event of Default shall occur as a result of
such Transfer;


 


(c)           Borrower shall pay Lender a transfer
fee which is payable to the Servicer equal to $25,000 at the time of such
Transfer; provided that no transfer fee shall be payable to the Lender
or the Servicer for the first such Transfer;


 


(d)           Borrower shall pay any and all
reasonable out-of-pocket costs incurred in connection with such Transfer
(including, without limitation, Lender’s reasonable counsel fees


 


80














 


and disbursements and all
recording fees, title insurance premiums and mortgage and intangible taxes and
the fees and expenses of the Rating Agencies pursuant to clause (1) below);


 


(e)           Transferee shall be a Qualified
Transferee;


 


(f)            Transferee must have demonstrated
expertise in owning and operating properties similar in location, size, class
and operation to the Property, which expertise shall be reasonably determined
by Lender;


 


(g)           Intentionally omitted;


 


(h)           If the Property is being transferred
and the Loan assumed, Transferee shall assume all of the obligations of
Borrower under the Loan Documents in a manner satisfactory to Lender in all
respects, including, without limitation, by entering into an assumption
agreement in form and substance reasonably satisfactory to Lender;


 


(i)            Transferee and the general partner
of Transferee (if Transferee is a limited partnership) or economic member of
Transferee (if Transferee is a limited liability company) must be able to
satisfy all the representations and covenants set forth in Section 3.1.8
(with respect to ERISA), Section 3.1.9 (with respect to Prescribed
Laws), Sections 4.1.1 (with respect to Prescribed Laws) and Section 4.2.11
(with respect to ERISA) of this Agreement;


 


(j)            Transferee and the general partner
of Transferee (if Transferee is a limited partnership) or economic member of
Transferee (if Transferee is a limited liability company) shall deliver all
organizational documentation reasonably requested by Lender, which shall be
reasonably satisfactory to Lender;


 


(k)           Borrower shall have delivered a
Rating Agency Confirmation with respect to Transferee and the Transfer;


 


(l)            Borrower or Transferee, at its sole
cost and expense, shall deliver to Lender a bankruptcy nonconsolidation opinion
letter reflecting such Transfer reasonably satisfactory in form and substance
to Lender and acceptable to the Rating Agencies;


 


(m)          (i) in the event Guarantor has
executed and delivered any guaranty in connection with the Loan, prior to any
release of Guarantor from its liabilities and obligations thereunder, one (1) or
more substitute guarantors reasonably acceptable to Lender and acceptable to
the Rating Agencies (A) shall have assumed all of the liabilities and
obligations of Guarantor under such guaranties or (B) shall execute and
deliver a replacement guaranty reasonably satisfactory to Lender and acceptable
to the Rating Agencies and.(ii) prior
to any release of Guarantor from its liabilities and obligations under the
Environmental Indemnity, one (1) or more substitute indemnitors reasonably
acceptable to Lender and acceptable to the Rating Agencies (A) shall have
assumed all of the liabilities and obligations of Guarantor under the
Environmental Indemnity or (B) shall execute and deliver a replacement
environmental indemnity reasonably satisfactory to Lender and acceptable to the
Rating Agencies;


 


(n)           Borrower shall deliver, at its sole
cost and expense, an endorsement to the Title Insurance Policies, insuring the
Mortgage, as modified by the assumption agreement, as a 


 


81

















 


valid first lien on the
Property and naming the Transferee as owner of the Property, which endorsement
shall insure that, as of the date of the recording of the assumption agreement,
the Property shall not be subject to any additional exceptions or liens other
than those contained in the relevant Title Insurance Policy issued on the date
hereof and the Permitted Encumbrances relating thereto; and


 


(o)           each Individual Property shall he
managed by a Qualified Manager pursuant to a replacement management agreement
reasonably satisfactory to Lender.


 


The consent of the Lender to
a Transfer may be conditioned on, among other things, whether or not the
Transferee, the controlling principals of Transferee and all other entities
which may be owned or controlled directly or indirectly by Transferee’s
controlling principals (such principal and other entities, collectively, the “Related
Persons”) are Disqualified Transferees as of the date of the Transfer (unless,
with respect to any entity, the controlling principals of Transferee did not
own or control such entity at the time there occurred with respect to such
entity the event giving rise to it being regarded as a Disqualified
Transferee).


 


Immediately upon a Transfer
to such Transferee and the satisfaction of all of the above requirements, the
named Borrower and Guarantor herein shall be released from all liability under
this Agreement, the Note, the Mortgage and the other Loan Documents accruing
after such Transfer.  The foregoing
release shall be effective upon the date of such Transfer, but Lender agrees to
provide written evidence thereof reasonably requested by Borrower.


 


Notwithstanding the
foregoing, nothing contained in this Agreement or the other Loan Documents
shall in any way restrict or prohibit, nor shall any notice to Lender or
consent of Lender be required in connection with, a Transfer effectuated in
compliance with the terms and provisions of clause (A) or clause (B) contained
in the last sentence of Section 8.2.


 


Section 8.2            Permitted Transfers of Interest in
Borrower.  A Transfer of (but not a mortgage,
pledge, hypothecation, encumbrance or grant of a security interest in) a direct
or indirect beneficial interest in Borrower or any SPC Party of Borrower shall
be permitted without Lender’s consent if (a) Lender receives thirty (30)
days prior written notice (or such shorter period of time as may be permitted
by Lender in its sole discretion) thereof and, to the extent required to permit
compliance by Borrower’s affiliates with Regulation FD, agrees to regard and
keep the same as Confidential, (b) Transferee and its Related Persons must
not be Disqualified Transferees as of the date of the Transfer; provided,
however, that in the event that the Transferee or any of its Related
Persons is a Disqualified Transferee, Lender shall not unreasonably withhold
its consent, and may consider such fact in making its determination, but such
fact shall not constitute the sole factor or reason for withholding its
consent, (c) immediately prior to such Transfer, no Event of Default shall
have occurred and be continuing (other than an Event of Default which would be
cured by such Transfer), (d) subsequent to such Transfer, Borrower and
each SPC Party continue to satisfy the conditions of Section 3.1.24,
(e) subsequent to such Transfer, Guarantor owns directly or indirectly
more than fifty percent (50%) of Borrower and each SPC Party and controls
Borrower and each SPC Party, and (f) if (i) such Transfer causes
Transferee to own, in the aggregate with the ownership interests of its
Affiliates, more than a 49% interest in Borrower or any SPC Party (and
Transferee together with its Affiliates did not, prior to such Transfer, own
more than a 49% interest in Borrower or such SPC 


 


82

















 


Party), or (ii) such
Transfer, together with all other Transfers of direct or indirect interest in
Borrower or any SPC Party, whether in a single Transfer or in a series of
Transfers and whether or not effected simultaneously, results in a transfer of
more than 49% of the aggregate ownership interests in Borrower or any SPC
Party, an acceptable non-consolidation opinion is delivered to Lender and to
each of the Rating Agencies concerning, as applicable, Borrower, each SPC
Party, Transferee and/or their respective owners.  Notwithstanding the foregoing, nothing
contained in this Agreement or the other Loan Documents shall in any way
restrict or prohibit, nor shall any notice to Lender or consent of Lender or
Rating Agency Confirmation (except as expressly provided below) be required in
connection with (A) the transfer, mortgage, pledge, hypothecation,
encumbrance or issuance of any ownership interests or securities in VNO, VRLP,
CEI, CRE, YAA, YAP or YCI or any Public Company (or of any Persons owning an
interest in any of the foregoing), (B) the merger or consolidation of VNO,
VRLP, CET, CRE, YAA, YAP or YCI or any Public Company with or into any other
Person (or of any Persons owning an interest in any of the foregoing), or a
sale or transfer of all or substantially all of the assets of VNO, VRLP, CEI,
CRE, YAA, YAP or YCI or of any Public Company (or of any Persons owning an
interest in any of the foregoing), (C) the transfer, mortgage, pledge,
hypothecation or encumbrance of any ownership interests or securities in
Guarantor between or among VNO, VRLP, CEI, CRE, YAA, YAP and YCI (or one or
more entities owned and controlled by any one or more of the foregoing), (D) the
issuance of any ownership interests or securities in Guarantor so long as
Guarantor (or its permitted successor) or its direct or indirect owner is or,
in connection with such issuance, becomes, a Public Company, and (E) the
merger or consolidation of Guarantor or its direct or indirect owner with or
into any other Person, provided that the surviving entity of such merger
or consolidation or its direct or indirect owner is a Public Company; provided
further that, if, after giving effect to any transaction described under clause
(D) or (E), VNO, VRLP, CEI, CRE, YAA, YAP and/or YCI would own in the
aggregate, directly or indirectly, less than fifty-one percent (51%) interest of Borrower or any SPC
Party or would not control Borrower and each SPC Party, Borrower shall have obtained a Rating Agency
Confirmation.


 


IX.           SALE
AND SECURITIZATION OF MORTGAGE


 


Section 9.1            Sale of Mortgage and Securitization;
Loan Components; Mezzanine Loans.  (a)  Subject to the limitations in Section 11.27,
Lender shall have the right (i) to sell or otherwise transfer the Loan or
any portion thereof as a whole loan, (ii) to sell participation interests
in the Loan or (iii) to securitize the Loan or any portion thereof in a
single-asset securitization or a pooled-loan securitization.  The transactions referred to in clauses (1), (ii) and
(iii) shall hereinafter be referred to collectively as “Secondary
Market Transactions” and the transactions referred to in clause (iii) shall
hereinafter be referred to as a “Securitization”.  Any certificates, notes or other securities
issued in connection with a Securitization are hereinafter referred to as “Securities”.


 


(b)           if requested by Lender, Borrower
shall use reasonable efforts to assist Lender in satisfying the market
standards to which Lender customarily adheres or which may be reasonably
required in the marketplace or by the Rating Agencies in connection with any
Secondary Market Transactions, including, without limitation, to:


 


83

















 


(i)            (A) provide
updated financial and other information with respect to the Property, the
business operated at the Property, Borrower and the Manager, (B) provide
updated budgets relating to the Property and (C) provide updated
appraisals, market studies, environmental reviews (Phase
l’s and, if appropriate,
Phase II’s), property condition reports and other due diligence investigations
of the Property (the “Updated Information”), together, if customary,
with appropriate verification of the Updated Information through letters of
auditors or opinions of counsel reasonably acceptable to Lender and acceptable
to the Rating Agencies;


 


(ii)           provide
opinions of counsel, which may be relied upon by Lender, the Rating Agencies
and their, respective counsel, agents and representatives, as to
non-consolidation, fraudulent conveyance, and true sale or any other opinion
customary in Secondary Market Transactions or required by the Rating Agencies
with respect to the Property and Borrower and Affiliates, which counsel and
opinions shall be reasonably satisfactory to Lender and satisfactory to the
Rating Agencies;


 


(iii)          provide
updated, as of the closing date of the Secondary Market Transaction if such
closing date is more than six (6) months after the date hereof,
representations and warranties made in the Loan Documents and such additional
representations and warranties as the Rating Agencies may reasonably require,
in each case, with such modifications as are necessary to make such
representations and warranties true in all material respects; and


 


(iv)          execute
amendments to the Loan Documents and Borrower’s organizational documents
reasonably requested by Lender; provided, however, that Borrower
shall not be required to modify or amend (A) any Loan Document if such
modification or amendment would change the interest rate, the stated maturity
or the amortization of principal as set forth herein or in the Note, or (B) any
Loan Document or organizational document of Borrower if in the reasonable
judgment of Borrower the same would modify or amend any other material economic
term of the Loan, increase Borrower’s obligations or liabilities thereunder in
any material respect, adversely effect any right of Borrower under the Loan
Documents in any material respect or have a material adverse effect on the
manner in which Borrower operates its business.


 


(c)           Borrower covenants and agrees that,
upon Lender’s request, Borrower shall deliver one or more new component notes
to replace the original note or modify the original note to reflect multiple
components of the Loan or create one or more new mezzanine loans (including
amending Borrower’s organizational structure to provide for one or more new
mezzanine borrowers) (each a “Resizing Event”).  Lender agrees that such new notes, modified
notes or mezzanine notes shall immediately after the Resizing Event have the
same initial weighted average interest rate as the original note immediately
prior to such Resizing Event.  Such new
notes, modified notes or mezzanine notes may allocate principal and interest
rates of the Loan between or among such new components and/or mezzanine loans
in a manner specified by Lender in its sole discretion; provided that,
unless an Event of Default has occurred and is then continuing, all prepayments
with respect to such new notes or modified note or mezzanine notes shall be
applied on a pro rata basis.  In
connection with any Resizing Event, Borrower covenants and agrees to modify and
amend the Cash Management Agreement, and execute 


 


84

















 


amendments to the Loan
Documents and Borrower’s organizational documents reasonably requested by
Lender; provided, however, that Borrower shall not be required to
modify or amend any Loan Document or organizational document of Borrower if in
the reasonable judgment of Borrower the same would increase Borrower’s monetary
obligations, modify or amend any other material economic term of the Loan,
increase Borrower’s other obligations or liabilities thereunder in any material
respect, adversely affect any right of Borrower under the Loan Documents in any
material respect or have a material adverse effect on the manner in which
Borrower operates its business.


 


(d)           Notwithstanding anything herein or in
any other Loan Document to the contrary, (i) all reasonable out-of-pocket
costs and expenses (other than the first $8,923 of legal fees) actually
incurred by Borrower or its Affiliates in connection with Borrower’s complying
with requests made under this Section 9.1 shall be paid by Lender
and (ii) Lender shall pay all other costs and expenses incurred by any
other parties in connection with any action contemplated by this Section 9.1.


 


(e)           Nothing contained in this Agreement
or in the other Loan Documents shall restrict Lender from requesting that
Borrower deliver to Lender information regarding tenants or customers at the
Property and the impact such tenants or customers have or may have on the Gross
Revenue of the Property; provided, however, that Borrower shall
not be required to deliver specific information concerning the specific pricing
structure applicable to any tenant or customer.


 


Section 9.2            Securitization Indemnification.  (a)  Borrower understands that information
provided to Lender by Borrower and its agents, counsel and representatives
may be included in
disclosure documents in connection with the Securitization, including, without
limitation, an offering circular, a prospectus, prospectus supplement, private
placement memorandum or other offering document (each, an “Disclosure
Document”) and may also be included in filings with the Securities and
Exchange Commission pursuant to the Securities Act of 1933, as amended (the “Securities
Act”), or the Securities and Exchange Act of 1934, as amended (the “Exchange
Act”), and may be made available to investors or prospective investors in the
Securities, the Rating Agencies, and service providers relating to the Securitization.


 


(b)           Borrower shall provide in connection
with each of (i) a preliminary and a final 
private placement memorandum or (ii) a preliminary and final
prospectus or prospectus supplement, as applicable, an agreement (the entering
into of which shall be at no cost to Borrower) (A) certifying that
Borrower has examined those portions of such Disclosure Documents specified by
Lender for Borrower’s review pertaining to Borrower, Borrower’s Affiliates,
Manager or the Loan and that each such Disclosure Document, as it relates to
sections of the Disclosure Documents specified with reasonable specificity by
Lender relating to Borrower, Borrower’s Affiliates, the Property, Manager and
any material aspects of the Loan, does not (except to the extent specified by
Borrower if Borrower does not agree with the statements therein) contain any
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements made, in the light of the circumstances under
which they were made, not misleading, (B) indemnifying Lender (and for
purposes of this Section 9.2, Lender hereunder shall include its
officers and directors), the Affiliate of Lender that has filed the
registration statement relating to the Securitization (the “Registration
Statement”), each of its 


 


85

















 


directors, each of its officers who have
signed the Registration Statement and each Person that controls the Affiliate
within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act (collectively, the “Lender Group”), and Lender, and
any other placement agent or underwriter with respect to the Securitization,
each of their respective directors and each Person who controls Lender or any
other placement agent or underwriter within the meaning of Section 15 of
the Securities Act and Section 20 of the Exchange Act (collectively, the “Underwriter
Group”) for any losses, claims, damages or liabilities, including
reasonable attorneys’ fees and disbursements, other than those arising out of
the gross negligence, willful misconduct or bad faith of any of the foregoing
proposed indemnitees (collectively, the “Liabilities”) to which Lender,
the Lender Group or the Underwriter Group may become subject insofar as the
Liabilities arise out of or are based upon any untrue statement of any material
fact contained in such sections or arise out of or are based upon the omission
to state therein a material fact required to be stated in such sections or
necessary in order to make the statements in such sections, in light of the
circumstances under which they were made, not misleading (except that (x) Borrower’s
obligation to indemnify in respect of any information contained in such
sections that is derived in part from information provided by Borrower and in
part from information provided by others unrelated to or not employed by
Borrower shall be limited to any untrue statement or omission of material fact
therein known to Borrower that results from an error in any information
provided (or which should have been provided) by Borrower which Borrower has
been given the opportunity to examine and reasonably and promptly approve
(Borrower hereby confirms that it has reviewed and approved each of the
appraisals, engineering, environmental and asbestos reports prepared by third
parties in connection with the Loan) and (y) Borrower shall have no
responsibility for the failure of any member of the Underwriting Group to
accurately transcribe written information supplied by Borrower or the refusal
of any member of the Underwriting Group to include any written information
supplied by Borrower after an explicit direction from Borrower to do so) and (C) agreeing
to reimburse Lender, the Lender Group and/or the Underwriter Group for any
legal or other expenses reasonably incurred by Lender, the Lender Group and the
Underwriter Group in connection with investigating or defending the Liabilities
to the extent that such legal or other expenses are incurred in connection with
matters for which Borrower has agreed to indemnify the Underwriter Group
herein; provided, however, that Borrower will be liable in any
such case under clauses (B) or (C) above only to the extent that any
such loss, claim, damage or liability arises out of or is based upon any such
untrue statement or omission made therein in reliance upon and in conformity
with information furnished to Lender by or on behalf of Borrower in connection
with the preparation of the Disclosure Document or in connection with the
underwriting or closing of the Loan, including, without limitation, financial
statements of Borrower, operating statements and major customer lists with
respect to the Property and not subsequently retracted or modified in whole or
in part so as to eliminate the misstatement or omission in question prior to
any Securitization.  This indemnity
agreement will be in addition to any liability which Borrower may otherwise
have.


 


(c)           Intentionally Omitted.


 


(d)           Promptly after receipt by an
indemnified party under this Section 9.2 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this Section 9.2,
notify the indemnifying party in writing of the commencement thereof; but the
omission to so notify the 


 


86

















 


indemnifying party will
not relieve the indemnifying party from any liability which the indemnifying
party may have to any indemnified party hereunder except to the extent that
failure to notify causes prejudice to the indemnifying party.  In  the event that
any action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled, jointly with any other indemnifying party, to participate therein
and, to the extent that it (or they) may elect by written notice delivered to
the indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party. 
After notice from the indemnifying party to such indemnified party under
this Section 9.2, such indemnified party shall pay for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation; provided,
however, if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party shall have
reasonably concluded that there are any legal defenses available to it and/or
other indemnified parties that are different from or additional to those
available to the indemnifying party, the indemnified party or parties shall
have the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party at the cost of the indemnifying party.  The indemnifying party shall not be liable
for the expenses of more than one separate counsel unless an indemnified party
shall have reasonably concluded that there may be legal defenses available to
it that are different from or additional to those available to another
indemnified party.


 


(e)           In order to provide for just and
equitable contribution in circumstances in which the indemnity agreement
provided for in Section 9.2(b) is for any reason held to be
unenforceable as to an indemnified party in respect of any losses, claims,
damages or liabilities (or action in respect thereof) referred to therein which
would otherwise be indemnifiable under Section 9.2(b), the
indemnifying party shall contribute to the amount paid or payable by the
indemnified party as a result of such losses, claims, damages or liabilities
(or action in respect thereof); provided, however, that no Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.  In addition, no right of contribution may be
enforced by any party who shall have committed gross negligence or willful
misconduct in connection with the actions or omissions that led to such
liability against any party who was not guilty of such gross negligence or
willful misconduct in connection with the actions or omissions that led to such
liability.  In determining the amount of
contribution to which the respective parties are entitled, the following
factors shall be considered: (i) the applicable Lender’s and Borrower’s
relative knowledge and access to information concerning the matter with respect
to which the claim was asserted; (ii) the opportunity to correct and
prevent any statement or omission; (iii) the responsibilities and
obligations of Borrower specified herein; and (iv) any other equitable
considerations appropriate in the circumstances.  Lender and Borrower hereby agree that it
would not be equitable if the amount of such contribution were determined by
pro rata or per capita allocation.


 


(f)            The liabilities and obligations of
both Borrower and Lender under this Section 9.2 shall survive the
termination of this Agreement and the satisfaction and discharge of the Debt.


 


87

















 


X.            DEFAULTS


 


Section 10.1         Event of Default.  (a)  Each of the following events shall
constitute an event of default hereunder (an “Event of Default”):


 


(i)            if
(A) the payment due on the Maturity Date is not paid when due, (B) if
any monthly installment of interest due under the Note (other than the payment
due on the Maturity Date) is not paid on or prior to the applicable Monthly
Payment Date; provided that it shall not be an Event of Default if a
monthly installment of interest is not paid when due if there are sufficient
sums on deposit in the Debt Service Account (as defined in the Cash Management
Agreement) for payment of such amounts and Lender’s access to such funds has
not been inhibited or prevented in any manner whatsoever due to circumstances
or events which are directly or indirectly caused by or otherwise relate to any
actions or omissions of Borrower or any of its Affiliates, or (C) any
other portion of the Debt is not paid when due and such non-payment continues
for five (5) days following notice to Borrower that the same is due
and payable;


 


(ii)           if
any of the Taxes or Other Charges are not paid when due, provided that
it shall not be an Event of Default if Taxes are not paid when due if there are
sufficient sums on deposit in the Tax Account (as defined in the Cash
Management Agreement) for payment of such amounts and Lender’s access to such
funds has not been inhibited or prevented in any manner whatsoever due to
circumstances or events which are directly or indirectly caused by or otherwise
relate to any actions or omissions of Borrower or any of its Affiliates;


 


(iii)          if
the Policies are not kept in full force and effect;


 


(iv)          if
Borrower breaches or permits or suffers a breach of  Section 4.2.1;


 


(v)           if
any representation or warranty made by Borrower herein or in any other Loan
Document, or in any material report, certificate, financial statement or other
instrument, agreement or document furnished to Lender shall have been false or
misleading in any material respect as of the date the representation or
warranty was made and, with respect to any such breach which is not the subject
of any other subsection of this Section 10.1(a) and which is
capable of being cured, Borrower fails to remedy such condition within ten (10) days
following notice to Borrower from Lender, in the case of any such breach which
can be cured by the payment of a sum of money, or within thirty (30) days
following notice from Lender in the case of any other such breach; provided,
however, that if such non-monetary breach is susceptible of cure but cannot
reasonably be cured within such 30-day period and provided further that
Borrower shall have commenced to cure such breach within such 30-day period and
thereafter diligently and expeditiously proceeds to cure the same, such 30-day
period shall be extended for such time as is reasonably necessary for Borrower
in the exercise of due diligence to cure such breach, such additional period
not to exceed sixty (60) days plus time permitted for Excusable Delays;


 


88

















 


(vi)          if
Borrower, any SPC Party or Guarantor shall make an assignment for the benefit
of creditors;


 


(vii)         if
a receiver, liquidator or trustee shall be appointed for Borrower, any SPC
Party or Guarantor or if Borrower, any SPC Party or Guarantor shall be
adjudicated a bankrupt or insolvent, or if any petition for bankruptcy,
reorganization or arrangement pursuant to federal bankruptcy law, or any
similar federal or state law, shall be filed by or against, consented to, or
acquiesced in by, Borrower, any SPC Party or Guarantor, or if any proceeding
for the dissolution or liquidation of Borrower, any SPC Party or Guarantor
shall be instituted; provided, however, if such appointment,
adjudication, petition or proceeding was involuntary and not consented to by
Borrower, any SPC Party or Guarantor, upon the same not being discharged,
stayed or dismissed within ninety (90) days;


 


(viii)        if
Borrower attempts to assign its rights under this Agreement or any of the other
Loan Documents or any interest herein or therein in contravention of the Loan
Documents;


 


(ix)           if
any of the assumptions contained in (A) the Insolvency Opinion, (B) any
other non-consolidation opinion delivered to Lender in connection with the Loan
or (C) any other non-consolidation opinion delivered subsequent to the
closing of the Loan is or shall become untrue in any material respect;


 


(x)            if
Borrower breaches in any material respect any representation, warranty or
covenant contained in Section 3.1.24 hereof;


 


(xi)           if
Borrower breaches any of the negative covenants contained in Section 4.2.12
hereof;


 


(xii)          a
Cross Event of Default has occurred and is continuing;


 


(xiii)         intentionally
omitted;


 


(xiv)        if
Guarantor breaches in any material respect any covenant, warranty or
representation contained in any guaranty executed and delivered by Guarantor in
connection with the Loan and such breach is not cured to Lender’s satisfaction
within fifteen (15) days of notice to Guarantor from Lender;


 


(xv)         intentionally
omitted;


 


(xvi)        if
at any time during the term of the Loan an Alteration Guaranty is delivered
pursuant to the terms of this Agreement and the guarantor thereunder (other
than Guarantor) fails to maintain an Investment Grade Rating (a “Downgrade
Event”)  and Borrower fails to deliver (A) a replacement
Alteration Guaranty in an amount equal to the amount of the “Guaranteed
Obligations” under such Alteration Guaranty from Guarantor or a guarantor with
an Investment Grade Rating or (B) Alteration Security within ten (10) Business
Days of the occurrence of the applicable Downgrade Event;


 


89

















 


(xvii)       intentionally
omitted;


 


(xviii)      if
Borrower shall continue to be in Default under any of the other terms,
covenants or conditions of this Agreement or any other Loan Document not
specified in subsections (i) to (xvii) above, for ten (10) days after
notice to Borrower from Lender, in the case of any Default which can be cured
by the payment of a sum of money, or for thirty (30) days after notice from
Lender in the case of any other Default; provided, however, that
if such non-monetary Default is susceptible of cure but cannot reasonably be
cured within such 30-day period and provided further that Borrower shall have
commenced to cure such Default within such 30-day period and thereafter
diligently and expeditiously proceeds to cure the same, such 30-day period
shall be extended for such time as is reasonably necessary for Borrower in the
exercise of due diligence to cure such Default, such additional period not to
exceed sixty (60) days plus time permitted for Excusable Delays; or


 


(xix)         if
any other such event shall occur or condition shall exist, if the effect of
such event or condition is to accelerate the maturity of any portion of the
Debt or to permit Lender to accelerate the maturity of all or any portion of
the Debt.


 


(b)           Upon the occurrence of an Event of
Default (other than an Event of Default described in clauses (vi), (vii) or
(viii) above) and at any time thereafter Lender may, in addition to any
other rights or remedies available to it pursuant 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 to protect and enforce its rights
against Borrower and in and to the Property, including, without limitation,
declaring the Debt to be immediately due and payable, and Lender may enforce or
avail itself of any or all rights or remedies provided in the Loan Documents
against Borrower and the Property, including, without limitation, all rights or
remedies available at law or in equity; and upon any Event of Default described
in clauses (vi), (vii) or (viii) above, the Debt and all other
obligations of Borrower hereunder and under the other Loan Documents shall
immediately and automatically become due and payable, without notice or demand,
and Borrower hereby expressly waives any such notice or demand, anything
contained herein or in any other Loan Document to the contrary notwithstanding.


 


Section 10.2         Remedies.  (a) 
Upon the occurrence and during the continuance of an Event of Default, all or
any one or more of the rights, powers, privileges and other remedies available
to Lender against Borrower under this Agreement or any of the other Loan
Documents executed and delivered by, or applicable to, Borrower or at law or in
equity may be exercised by Lender at any time and from time to time, whether or
not all or any of the Debt shall be declared due and payable, and whether or
not Lender shall have commenced any foreclosure proceeding or other action for
the enforcement of its rights and remedies under any of the Loan Documents with
respect to the Property.  Any such
actions taken by Lender shall be cumulative and concurrent and may be pursued
independently, singly, successively, together or otherwise, at such time and in
such order as Lender may determine in its sole discretion, to the fullest
extent permitted by law, without impairing or otherwise 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. 
Without limiting the generality of the foregoing, if all Event of
Default is continuing (i) Lender is not subject to any “one action” or “election
of remedies” law or rule, and 


 


90

















 


(ii) all liens and
other rights, remedies or privileges provided to Lender shall remain in full
force and effect until Lender has exhausted all of its remedies against the
Property and the Mortgage has been foreclosed, sold and/or otherwise realized
upon in satisfaction of the Debt or the Debt has been paid in full.


 


(b)           Upon the occurrence and during the
continuance of an Event of Default, Lender shall have the right from time to
time to partially foreclose the Mortgage in any manner and for any amounts
secured by the Mortgage then due and payable as determined by Lender in its
sole discretion including, without limitation, the following circumstances: (i) in
the event Borrower defaults beyond any
applicable grace
period in the payment of one or more scheduled payments of principal and
interest, Lender may foreclose the Mortgage to recover such delinquent
payments, or (ii) in the event Lender elects to accelerate less than the
entire outstanding principal balance of the Loan, Lender may foreclose the
Mortgage to recover so much of the principal balance of the Loan as Lender may
accelerate and such other sums secured by the Mortgage as Lender may
elect.  Notwithstanding one or more
partial foreclosures, the Property shall remain subject to the Mortgage to
secure payment of sums secured by the Mortgage and not previously recovered.


 


(c)           Lender shall have the right from time
to time to sever the Note and the other Loan Documents into one or more
separate notes, mortgages and other security documents (the Severed Loan
Documents”) in such denominations as Lender shall determine in its sole
discretion for purposes of evidencing and enforcing its rights and remedies
provided hereunder.  Borrower shall
execute and deliver to Lender from time to time, promptly after the request of
Lender, a severance agreement and such other documents as Lender shall request
in order to effect the severance described in the preceding sentence, all in
form and substance reasonably satisfactory to Lender.  Borrower hereby absolutely and irrevocably
appoints Lender as its true and lawful attorney, coupled with an interest, in
its name and stead to make and execute all documents necessary or desirable to
effect the aforesaid severance, Borrower ratifying all that its said attorney
shall do by virtue thereof; provided, however, Lender shall not
make or execute any such documents under such power until three (3) days
after notice has been given to Borrower by Lender of Lender’s intent to
exercise its rights under such power. 
Borrower shall not be obligated to pay any costs or expenses incurred in
connection with the preparation, execution, recording or filing of the Severed
Loan Documents.  The Severed Loan
Documents shall contain only provisions which are substantially similar to
those contained in the Loan Documents (except to reflect reductions in
principal) and which do not have any material adverse effect on Borrower’s
rights or obligations thereunder in any material respect or increase Borrower’s
monetary obligations thereunder in any material respect or the
operation of its business and any representations and warranties contained in
the Severed Loan Documents will be given by Borrower only as of the date
hereof.


 


(d)           Any amounts recovered from the
Property or any other collateral for the Loan after an Event of Default may be
applied by Lender toward the payment of any interest and/or principal of the
Loan and/or any other amounts due under the Loan Documents in such order,
priority and proportions as Lender in its sole
discretion shall
determine; provided, however, that Borrower shall not be liable
for the misapplication of any amounts recovered and applied by Lender in its sole
discretion.


 


91














 


Section 10.3         Right to Cure Defaults.  Upon the occurrence and during the continuance of an
Event of Default, Lender may, but without any obligation to do so and without
notice to or demand on Borrower and without releasing Borrower from any
obligation hereunder or being deemed to have cured any Event of Default
hereunder, make, do or perform any obligation of Borrower hereunder in such
manner and to such extent as Lender may deem necessary in respect of such Event
of Default.  Lender is authorized to
enter upon the Property for such purposes, or appear in, defend, or bring any
action or proceeding to protect its interest in the Property for such purposes,
and the cost and expense thereof (including reasonable attorneys’ fees to the
extent permitted by law), with interest as provided in this Section 10.3,
shall constitute a portion of the Debt and shall be due and payable to Lender
upon demand.  All such costs and expenses
incurred by Lender in remedying such Event of Default or such failed payment or
act or in appearing in, defending, or bringing any action or proceeding shall
bear interest at the Default Rate, for the period after such cost or expense
was incurred into the date of payment to Lender.  All such costs and expenses incurred by
Lender together with interest thereon calculated at the Default Rate shall be
deemed to constitute a portion of the Debt and be secured by the liens, claims
and security interests provided to Lender under the Loan Documents and shall be
immediately due and payable upon demand by Lender therefore.


 


Section 10.4         Remedies Cumulative.  The rights, powers and remedies of Lender under this
Agreement shall be cumulative and not exclusive of any other right, power or
remedy which Lender may have against Borrower pursuant to this Agreement or the
other Loan Documents, or existing at law or in equity or otherwise.  Lender’s rights, powers and remedies may be
pursued singly, concurrently or otherwise, at such time and in such order as
Lender may determine in Lender’s sole discretion.  No delay or omission to exercise any remedy,
right or power accruing upon an Event of Default shall impair any such remedy,
right or power or shall be construed as a waiver thereof, but any such remedy,
right or power may be exercised from time to time and as often as may be deemed
expedient.  A waiver of one Default or
Event of Default with respect to Borrower shall not be construed to be a waiver
of any subsequent Default or Event of Default by Borrower or to impair any
remedy, right or power consequent thereon.


 


XI.           MISCELLANEOUS


 


Section 11.1         Successors and Assigns. 
All covenants, promises and agreements in this Agreement shall inure to
the benefit of the legal representatives, successors and assigns of the parties
hereto.


 


Section 11.2         Lender’s Discretion.  Whenever pursuant to this Agreement Lender exercises
any right given to it to approve or disapprove, or any arrangement or term is
to be satisfactory to Lender, the decision of Lender to approve or disapprove
or to decide whether arrangements or terms are satisfactory or not satisfactory
shall (except as is otherwise specifically herein provided) be in the sole
discretion of Lender (which discretion shall be exercised in good faith) and
shall be final and conclusive.  Prior to
a Securitization, whenever pursuant to this Agreement the Rating Agencies are
given any right to approve or disapprove, or any arrangement or term is to be
satisfactory to the Rating Agencies, the decision of Lender to approve or
disapprove or to decide whether arrangements or terms are satisfactory or not
satisfactory, based upon Lender’s determination of Rating Agency criteria,
shall be substituted therefore.


 


92

















 


Section 11.3         Governing Law.  (A) THIS AGREEMENT WAS NEGOTIATED IN THE
STATE OF NEW YORK, THE LOAN WAS MADE BY LENDER AND ACCEPTED BY BORROWER IN THE
STATE OF NEW YORK, AND THE PROCEEDS OF THE LOAN DELIVERED PURSUANT HERETO WERE
DISBURSED FROM THE STATE OF NEW YORK, WHICH STATE THE PARTIES AGREE HAS A
SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING TRANSACTION
EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING, WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE,
THIS AGREEMENT, THE NOTE AND THE OTHER LOAN DOCUMENTS AND THE OBLIGATIONS
ARISING HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE
AND PERFORMED IN SUCH STATE (WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS) AND
ANY APPLICABLE LAW OF THE UNITED STATES OF AMERICA, EXCEPT THAT AT ALL TIMES
THE PROVISIONS FOR THE CREATION, PERFECTION, AND ENFORCEMENT OF THE LIEN AND
SECURITY INTEREST CREATED PURSUANT HERETO AND PURSUANT TO THE OTHER LOAN
DOCUMENTS (OTHER THAN WITH RESPECT TO LIENS AND SECURITY INTERESTS IN PROPERTY
WHOSE PERFECTION AND PRIORITY IS COVERED BY ARTICLE 9 OF THE UCC (EXCLUDING
FIXTURES AND INCLUDING, WITHOUT LIMITATION, THE ACCOUNTS) WHICH SHALL BE
GOVERNED BY THE LAW OF THE JURISDICTION APPLICABLE THERETO IN ACCORDANCE WITH
SECTIONS 9-301 THROUGH 9-307 OF THE UCC AS IN EFFECT IN THE STATE OF NEW YORK)
SHALL BE GOVERNED BY AND CONSTRUED ACCORDING TO THE LAW OF THE STATE IN WHICH
THE PROPERTY IS LOCATED, IT BEING UNDERSTOOD THAT, TO THE FULLEST
EXTENT PERMITTED BY THE LAW OF SUCH STATE, THE LAW OF THE STATE OF NEW YORK
SHALL GOVERN THE CONSTRUCTION, VALIDITY AND ENFORCEABILITY OF ALL LOAN
DOCUMENTS AND ALL OF THE OBLIGATIONS ARISING HEREUNDER OR THEREUNDER.  TO THE FULLEST EXTENT PERMITTED BY LAW,
BORROWER AND LENDER HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVE ANY CLAIM TO
ASSERT THAT THE LAW OF ANY OTHER JURISDICTION GOVERNS THIS AGREEMENT, THE NOTE
AND THE OTHER LOAN DOCUMENTS,
AND THIS AGREEMENT, THE NOTE AND THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATIONS LAW EXCEPT
AS SPECIFICALLY SET FORTH ABOVE.


 


(B) ANY
LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR BORROWER ARISING OUT OF OR
RELATING TO THIS AGREEMENT MAY BE INSTITUTED IN ANY FEDERAL OR STATE COURT
IN THE’ CITY OF NEW YORK, COUNTY OF NEW YORK, PURSUANT TO SECTION 5-1402
OF THE NEW YORK GENERAL OBLIGATIONS LAW AND LENDER AND BORROWER EACH WAIVES ANY
OBJECTIONS WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM
NON CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND BORROWER AND LENDER
HEREBY IRREVOCABLY 


 


93

















 


SUBMIT TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT,
ACTION OR PROCEEDING.  BORROWER DOES
HEREBY DESIGNATE AND APPOINT:


 


CT CORPORATION

111 EIGHTH AVENUE, 13TH FLOOR

NEW YORK, NEW YORK 10011


 


AS ITS AUTHORIZED AGENT TO ACCEPT
AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY AND ALL PROCESS WHICH MAY BE
SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY FEDERAL OR STATE COURT IN
NEW YORK, NEW YORK, AND AGREES THAT SERVICE OF PROCESS UPON SAID AGENT AT SAID
ADDRESS AND WRITTEN NOTICE OF SAID SERVICE MAILED OR DELIVERED TO BORROWER IN
THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE
OF PROCESS UPON BORROWER, IN ANY SUCH SUIT, ACTION OR PROCEEDING IN THE STATE
OF NEW YORK.  BORROWER (I) SHALL
GIVE PROMPT NOTICE TO LENDER OF ANY CHANGED ADDRESS OF ITS AUTHORIZED AGENT
HEREUNDER, (II) MAY AT ANY TIME AND FROM TIME TO TIME DESIGNATE A
SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW YORK (WHICH
SUBSTITUTE AGENT AND OFFICE SHALL BE DESIGNATED AS THE PERSON AND ADDRESS FOR
SERVICE OF PROCESS), AND (III) SHALL PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF
ITS AUTHORIZED AGENT CEASES TO HAVE AN OFFICE IN NEW YORK, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A
SUCCESSOR.


 


Section 11.4         Modification, Waiver in Writing.  No modification, amendment, extension, discharge,
termination or waiver of any provision of this Agreement or of any other Loan
Document, nor consent to any departure by Borrower therefrom, shall in any
event be effective unless the same shall be in a writing signed by the party
against whom enforcement is sought, and then such waiver or consent shall be
effective only in the specific instance, and for the purpose, for which
given.  Except as otherwise expressly
provided herein, no notice to, or demand on Borrower, shall entitle Borrower to
any other or future notice or demand in the same, similar or other
circumstances.


 


Section 11.5         Delay Not a Waiver.  Neither any failure nor any delay on the part of
Lender in insisting upon strict performance of any term, condition, covenant or
agreement, or exercising any right, power, remedy or privilege hereunder, or
under any other Loan Document, shall operate as or constitute a waiver thereof,
nor shall a single or partial exercise thereof preclude any other future
exercise, or the exercise of any other right, power, remedy or privilege.  In particular, and not by way of limitation,
by accepting payment after the due date of any amount payable under this
Agreement or any other Loan Document, Lender shall not be deemed to have waived
any right either to require prompt payment when due of all other amounts due
under this Agreement or the other Loan Documents, or to declare a default for
failure to effect prompt payment of any such other amount.  Lender shall have the right to waive or
reduce any time periods that Lender is entitled to under the Loan Documents in
its sole and absolute discretion.


 


94

















 


Section 11.6         Notices.  All notices, demands, requests, consents, approvals or
other communications (any of the foregoing, a “Notice”) required, permitted,
or desired to be given hereunder shall be in writing sent by telefax (with
answer back acknowledged) or by registered or certified mail, postage prepaid,
return receipt requested, or delivered by hand or reputable overnight courier
addressed to the party to be so notified at its address hereinafter set forth,
or to such other address as such party may hereafter specify in accordance with
the provisions of this Section 11.6.  Any Notice shall be deemed to have been
received: (a) three (3) days after the date such Notice is mailed, (b) on
the date of sending by telefax if sent during business hours on a Business Day
(otherwise on the next Business Day), (c) on the date of delivery by hand
if delivered during business hours on a Business Day (otherwise on the next
Business Day), and (d) on the next Business Day if sent by an overnight
commercial courier, in each case addressed to the parties as follows:


 


	
   

  	
  If
  to Lender:

  	
   

  	
  UBS
  Real Estate Securities Inc.

  
	
   

  	
   

  	
   

  	
  1285
  Avenue of the Americas

  
	
   

  	
   

  	
   

  	
  New
  York, New York 10019

  
	
   

  	
   

  	
   

  	
  Attention:
  Jeffrey N. Lavine

  
	
   

  	
   

  	
   

  	
  Facsimile
  No.: (212) 713-4062

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  with
  a copy to:

  	
   

  	
  Cadwalader,
  Wickersham & Taft LLP

  
	
   

  	
   

  	
   

  	
  One
  World Financial Center

  
	
   

  	
   

  	
   

  	
  New
  York, New York 10281

  
	
   

  	
   

  	
   

  	
  Attention:
  Steven M. Herman, Esq.

  
	
   

  	
   

  	
   

  	
  Facsimile
  No.: (212) 504-6666

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  If
  to Borrower:

  	
   

  	
  c/o AmeriCold Logistics, LLC

  
	
   

  	
   

  	
   

  	
  10
  Glenlake Parkway, Suite 800

  
	
   

  	
   

  	
   

  	
  Atlanta,
  Georgia 30328

  
	
   

  	
   

  	
   

  	
  Attention:
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
  Facsimile
  No: (678) 441-6852

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  with
  a copy to:

  	
   

  	
  c/o  Crescent Real
  Estate Equities

  
	
   

  	
   

  	
   

  	
  777
  Main Street, Suite 2100

  
	
   

  	
   

  	
   

  	
  Fort
  Worth, Texas 76102

  
	
   

  	
   

  	
   

  	
  Attention:
  David Dean, Executive Vice President – Law

  Facsimile No.: (817) 321-2929

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  with
  a copy to:

  	
   

  	
  c/o
  Yucaipa American Alliance Fund I, LP

  
	
   

  	
   

  	
   

  	
  9130
  West Sunset Boulevard

  
	
   

  	
   

  	
   

  	
  Los
  Angeles, California 90069

  
	
   

  	
   

  	
   

  	
  Attention:
  Legal Department

  
	
   

  	
   

  	
   

  	
  Facsimile
  No.: (310) 789-1791

  



 


95

















 


	
   

  	
  with a copy to:

  	
   

  	
  c/o  Yucaipa
  Corporate Initiatives Fund I, LP

  
	
   

  	
   

  	
   

  	
  9130 West Sunset Boulevard

  
	
   

  	
   

  	
   

  	
  Los Angeles, California
  90069

  
	
   

  	
   

  	
   

  	
  Attention: Legal
  Department

  
	
   

  	
   

  	
   

  	
  Facsimile No.: (310)
  789-1791

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  with
  a copy to:

  	
   

  	
  c/o
  Vornado Realty Trust

  
	
   

  	
   

  	
   

  	
  888
  Seventh Avenue

  
	
   

  	
   

  	
   

  	
  New
  York, New York 10019

  
	
   

  	
   

  	
   

  	
  Attention:
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
  Facsimile
  No.: (201) 843-2198

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  with a copy to:

  	
   

  	
  Sullivan &
  Cromwell LLP

  
	
   

  	
   

  	
   

  	
  125
  Broad Street

  
	
   

  	
   

  	
   

  	
  New York, New York 10004

  
	
   

  	
   

  	
   

  	
  Attention: Arthur S.
  Adler, Esq.

  
	
   

  	
   

  	
   

  	
  Facsimile No.: (212)
  558-3588

  



 


Section 11.7         Trial by Jury.  BORROWER AND
LENDER EACH HEREBY AGREES NOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF
RIGHT BY JURY, AND WAIVES ANY RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT
ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH REGARD TO THE LOAN DOCUMENTS,
OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING IN CONNECTION THEREWITH.  THIS WAIVER OF RIGHT TO TRIAL BY JURY IS
GIVEN KNOWINGLY AND VOLUNTARILY BY BORROWER AND LENDER, AND IS INTENDED TO
ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD
OTHERWISE ACCRUE.  EACH PARTY IS HEREBY
AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF
THIS WAIVER.


 


Section 11.8         Headings.  The Article and/or Section headings and the
Table of Contents in this Agreement are included herein for convenience of reference
only and shall not constitute a part of this Agreement for any other purpose.


 


Section 11.9         Severability.  Wherever possible, each provision of this Agreement
shall be interpreted 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 under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Agreement.


 


Section 11.10       Preferences.  Lender shall have the continuing and exclusive right
to apply or reverse and reapply any and all payments by Borrower to any portion
of the obligations of Borrower hereunder. 
To the extent Borrower makes a payment or payments to Lender, which
payment or proceeds or any part thereof are subsequently invalidated, declared
to be fraudulent or preferential, set aside or required to be repaid to a
trustee, receiver or any other party under any bankruptcy law, state or federal
law, common law or equitable cause, then, to the 


 


96

















 


extent of such payment or
proceeds received, the obligations hereunder or part thereof intended to be
satisfied shall be revived and continue in full force and effect, as if such
payment or proceeds had not been received by Lender.


 


Section 11.11       Waiver
of Notice.  Borrower shall not be entitled to any notices of any
nature whatsoever from Lender except with respect to matters for which this
Agreement or the other Loan Documents specifically and expressly provide for
the giving of notice by Lender to Borrower and except with respect to matters
for which Borrower is not, pursuant to applicable Legal Requirements, permitted
to waive the giving of notice.  Borrower
hereby expressly waives the right to receive any notice from Lender with
respect to any matter for which this Agreement or the other Loan Documents do
not specifically and expressly provide for the giving of notice by Lender to
Borrower.


 


Section 11.12       Remedies of Borrower.  In the event that a claim or adjudication is made that
Lender or its agents have acted unreasonably or unreasonably delayed acting in
any case where, by law or under this Agreement or the other Loan Documents, Lender
or such agent, as the case may be, has an obligation to act reasonably or
promptly, neither Lender nor its agents shall be liable for any monetary
damages, and Borrower’s sole remedy shall be limited to commencing an action
seeking injunctive relief or declaratory judgment.  Any action or proceeding to determine whether
Lender has acted reasonably shall be determined by an action seeking
declaratory judgment.


 


Section 11.13       Expenses; Indemnity.  (a)  Borrower shall pay or, if Borrower fails to
pay, reimburse Lender upon receipt of notice from Lender, for all reasonable
and customary out-of-pocket costs and expenses (including reasonable attorneys’
fees and disbursements) incurred by Lender in connection with (i) Borrower’s
ongoing performance of and compliance with Borrower’s agreements and covenants
contained in this Agreement and the other Loan Documents on its part to be
performed or complied with after the date hereof, including, without
limitation, confirming compliance with environmental and insurance
requirements; (ii) Lender’s ongoing performance of and compliance with all
agreements and covenants contained in this Agreement and the other Loan
Documents on its part to be performed or complied with after the date hereof; (iii) the
negotiation, preparation, execution, delivery and administration of any
consents, amendments, waivers or other modifications to this Agreement and the
other Loan Documents and any other documents or matters requested by Borrower; (iv) the
filing and recording fees and expenses, title insurance and reasonable fees and
expenses of counsel for providing to Lender all required legal opinions, and
other similar expenses incurred, in creating and perfecting the Liens in favor
of Lender pursuant to this Agreement and the other Loan Documents; (v) enforcing
or preserving any rights, in response to third party claims or the prosecuting
or defending of any action or proceeding or other litigation or otherwise upon
the occurrence and during the continuance of an Event of Default, in each case
against, under or affecting Borrower, this Agreement, the other Loan Documents,
the Property, or any other security given for the Loan; and (vi) enforcing
any obligations of or collecting any payments due from Borrower under this
Agreement, the other Loan Documents or with respect to the Property or in
connection with any refinancing or restructuring of the credit arrangements
provided under this Agreement in the nature 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 costs and expenses to
the extent the same arise by reason of the gross negligence, illegal acts, 


 


97

















 


bad faith, fraud or
willful misconduct of Lender.  Any costs
due and payable to Lender which are not paid by Borrower within ten (10) days
after written demand therefore may be paid to Lender pursuant to the Cash
Management Agreement.


 


(b)           Borrower shall indemnify, defend and
hold harmless Lender and its officers, directors, agents, employees (and the
successors and assigns of the foregoing) (the “Lender Indemnitees”) from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, claims, costs, expenses and disbursements of any
kind or nature whatsoever (including, without limitation, the reasonable fees
and disbursements of counsel for the Lender Indemnitees in connection with any
investigative, administrative or judicial proceeding commenced or threatened,
whether or not the Lender Indemnitees shall be designated a party thereto),
that may be imposed on, incurred by, or asserted against the Lender lndemnitees
in any manner relating to or arising out of (i) any breach by Borrower of
its obligations under, or any material misrepresentation by Borrower contained
in, this Agreement or the other Loan Documents, or (ii) the use or
intended use of the proceeds of the Loan (collectively, the “Indemnified
Liabilities”); provided, however, that Borrower shall not
have any obligation to the Lender Indemnitees hereunder to the extent that such
Indemnified Liabilities arise from the gross negligence, illegal acts, bad
faith, fraud or willful misconduct of the Lender Indemnitees.  To the extent that the undertaking to
indemnify, defend and hold harmless set forth in the preceding sentence may be
unenforceable because it violates any law or public policy, Borrower shall pay
the maximum portion that it is permitted to pay and satisfy under applicable
law to the payment and satisfaction of all Indemnified Liabilities incurred by
any Lender Indemnitees.


 


Section 11.14       Schedules Incorporated.  The Schedules annexed hereto are hereby incorporated
herein as a part of this Agreement with the same effect as if set forth in the  body hereof.


 


Section 11.15       Offsets, Counterclaims and Defenses.  Any assignee of Lender’s interest in and to this
Agreement and the other Loan Documents shall take the same free and clear of
all offsets, counterclaims or defenses which are unrelated to such documents
which Borrower may otherwise have against any assignor of such documents, and
no such unrelated counterclaim  or
defense shall be interposed or asserted by Borrower in any action or proceeding
brought by any such assignee upon such documents and any such right to
interpose or assert any such unrelated offset, counterclaim or defense in any
such action or proceeding is hereby expressly waived by Borrower.


 


Section 11.16       No Joint Venture or Partnership; No Third
Party Beneficiaries.  (a)  Borrower and Lender intend that
the relationships created hereunder and under the other Loan Documents be
solely that of borrower and lender. 
Nothing herein or therein is intended to create a joint venture,
partnership, tenancy-in-common, or joint tenancy relationship between Borrower
and Lender nor to grant Lender any interest in the Property other than that of
mortgagee, beneficiary or lender.


 


(b)           This Agreement and the other Loan
Documents are solely for the benefit of Lender and nothing contained in this
Agreement or the other Loan Documents shall be deemed to confer upon anyone
other than Lender any right to insist upon or to enforce the 


 


98

















 


performance or observance
of any of the obligations contained herein or therein.  All conditions to the obligations of Lender
to make the Loan hereunder are imposed solely and exclusively for the benefit
of Lender and no other Person shall have standing to require satisfaction of
such conditions in accordance with their terms
or be entitled to assume that Lender will refuse to make the Loan in the absence of strict
compliance with any or all thereof and no other Person shall under any
circumstances be deemed to be a beneficiary of such conditions, any or all of
which may be freely waived in whole or in part by Lender if, in Lender’s sole
discretion, Lender deems it advisable or desirable to do so.


 


Section 11.17       Publicity.  All news releases, publicity or advertising (other
than any of the foregoing effectuated in connection with a Securitization of
all or any portion of the Loan by Lender) by each of Lender or Borrower or
their Affiliates through any media intended to reach the general public which
refers to the Loan Documents or the financing evidenced by the Loan Documents,
to Lender, Borrower or any of their Affiliates shall be subject to the prior
approval of Lender and (except in connection with a Securitization of all or
any portion of the Loan) Borrower (except that no Lender approval shall be
required for Borrower’s or its Affiliate’s press release, if any, in connection
with the execution and delivery of this Agreement), which approval, in any
case, shall not be unreasonably withheld, conditioned or delayed.


 


Section 11.18       Waiver of Marshalling of Assets. 
To the fullest extent permitted by law, Borrower, for itself and its
successors and assigns, waives all rights to a marshalling of the assets of
Borrower, Borrower’s partners and others with interests in Borrower, and of the
Property, and shall not assert any right under any laws pertaining to the
marshalling of assets, the sale in inverse order of alienation, homestead
exemption, the administration of estates of decedents, or any other matters
whatsoever to defeat, reduce or affect the right of Lender under the Loan Documents
to a sale of the Property for the collection of the Debt without any prior or
different resort for collection or of the right of Lender to the payment of the
Debt out of the net proceeds of the Property in preference to every other
claimant whatsoever.


 


Section 11.19       Waiver of Offsets/Defenses/Counterclaims. 
Borrower hereby waives the right to assert a counterclaim, other than a
compulsory counterclaim, in any action or proceeding brought against it by
Lender or its agents or otherwise to offset any obligations to make the
payments required by the Loan Documents. 
No failure by Lender to perform any of its obligations hereunder shall
be a valid defense to, or result in any offset against, any payments which Borrower
is obligated to make under any of the Loan Documents.


 


Section 11.20       Conflict; Construction of Documents;
Reliance.  In the event of any conflict between the
provisions of this Agreement and any of the other Loan Documents, the
provisions of this Agreement shall control. 
The parties hereto acknowledge that they were represented by competent
counsel in connection with the negotiation, drafting and execution of the Loan
Documents and that such Loan Documents shall not be subject to the principle of
construing their meaning against the party which drafted same.  Borrower acknowledges that, with respect to
the Loan, Borrower shall rely solely on its own judgment and advisors in
entering into the Loan without relying in any manner on any statements, representations
or recommendations of Lender or any parent, subsidiary or Affiliate of
Lender.  Lender shall not be subject to
any limitation whatsoever in the exercise of any rights or remedies available
to it under 


 


99

















 


any of the Loan Documents
or any other agreements or instruments which govern the Loan by virtue of the
ownership by it or any parent, subsidiary or Affiliate 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 take any action on the basis of the
foregoing with respect to Lender’s exercise of any such rights or
remedies.  Borrower acknowledges that
Lender engages in the business of real estate financings and other real estate
transactions and investments which may be viewed as adverse to or competitive
with the business of Borrower or its Affiliates.


 


Section 11.21       Brokers and Financial Advisors.  Borrower and Lender each hereby represent that
it has not dealt independently of the other with any financial advisors,
brokers, underwriters, placement agents, agents or finders in connection with
the transactions contemplated by this Agreement.  Each party shall indemnify, defend and hold
the other party harmless from and against any and all claims, liabilities,
costs and expenses of any kind (including reasonable attorneys’ fees and
expenses) in any way relating to or arising from a claim by any Person that
such Person acted on behalf of such party in connection with the transactions
contemplated herein.  The provisions of
this Section 11.21 shall survive the expiration and termination of
this Agreement and the payment of the Debt.


 


Section 11.22       Exculpation. 
Subject to the qualifications below, Lender shall not enforce the
liability and obligation of Borrower to perform and observe the obligations
contained in the Note, this Agreement, the Mortgage or the other Loan Documents
by any action or proceeding wherein a money judgment shall be sought against
Borrower, except that Lender may bring a foreclosure action, an action for
specific performance or any other appropriate action or proceeding to enable
Lender to enforce and realize upon its interest under the Note, this Agreement,
the Mortgage and the other Loan Documents, or in the Property, the Rents, or
any other collateral given to Lender pursuant to the Loan Documents; provided,
however, that, except as specifically provided herein, any judgment in
any such action or proceeding shall be enforceable against Borrower only to the
extent of Borrower’s interest in the Property, in the Rents and in any other
collateral given to Lender, and Lender, by accepting the Note, this Agreement,
the Mortgage and the other Loan Documents, shall not sue for, seek or demand
any deficiency judgment against Borrower in any such action or proceeding under
or by reason of or under or in connection with the Note, this Agreement, the
Mortgage or the other Loan Documents. 
The provisions of this Section shall not, however, (a) constitute
a waiver, release or impairment of any obligation evidenced or secured by any
of the Loan Documents; (b) impair the right of Lender to name Borrower as
a party defendant in any action or suit for foreclosure and sale under the
Mortgage; (c) affect the validity or enforceability of any guaranty made
in connection with the Loan or any of the rights and remedies of Lender
thereunder; (d) impair the right of Lender to obtain the appointment of a
receiver; (e) impair the enforcement of the Assignment of Leases; (f) constitute
a prohibition against Lender to seek a deficiency judgment against Borrower in
order to fully realize on any security given by Borrower in connection with the
Loan or to commence any other appropriate action or proceeding in order for
Lender to exercise its remedies against such security which, in any event,
shall only be enforced against such security; or (g) constitute a waiver
of the right of Lender to enforce the liability and obligation of Borrower, by
money judgment or otherwise, to the extent of any loss, damage, cost, expense,
liability, claim or other obligation incurred by Lender (including attorneys’
fees and costs reasonably incurred) arising out of or in connection with any of
the following:


 


100

















 


(i)            fraud
or intentional misrepresentation by Borrower or any guarantor in connection
with the Loan;


 


(ii)           the
gross negligence or willful misconduct of Borrower;


 


(iii)          the
breach of any representation, warranty, covenant or indemnification provision
in the Environmental Indemnity or in the Mortgage concerning environmental
laws, hazardous substances and asbestos and any indemnification of Lender with
respect thereto in either document;


 


(iv)          the
removal or disposal of any portion of the Property after an Event of Default
other than in accordance with the terms of the Loan Documents (including,
without limitation, the Cash Management Agreement);


 


(v)           the
misapplication or conversion by Borrower of (A) any insurance proceeds
paid by reason of any loss, damage or destruction to the Property, (B) any
Awards or other amounts received in connection with the.  Condemnation of all or a portion of the
Property, or (C) any Rents following an Event of Default;


 


(vi)          any
security deposits, advance deposits or any other deposits collected with respect
to the Property which are not delivered to Lender upon a foreclosure of the
Property or action in lieu thereof, except to the extent any such security
deposits were applied in accordance with the terms and conditions
of any of the Leases prior to the occurrence of the Event of Default that gave
rise to such foreclosure or action in lieu thereof;


 


(vii)         Borrower’s
indemnification of Lender set forth in Section 9.2 hereof;


 


(viii)        intentionally
omitted; and


 


(ix)           intentionally
omitted.


 


Notwithstanding anything to
the contrary in this Agreement, the Note or any of the Loan Documents, (A) Lender
shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any
other provisions of the Bankruptcy Code to file a claim for the full amount of
the Debt or to require that all collateral shall continue to secure all of the
Debt owing to Lender in accordance with the Loan Documents, and (B) the
Debt shall be fully recourse to Borrower in the event that: (i) Borrower
fails to obtain Lender’s prior consent to any subordinate financing or other
voluntary Lien encumbering the Property; (ii) Borrower fails to obtain
Lender’s prior consent to any assignment, transfer, or conveyance of the
Property or any interest therein as required by the Mortgage or this Agreement;
(iii) Borrower files a voluntary petition under the Bankruptcy Code or any
other Federal or state bankruptcy or insolvency law; (iv) an Affiliate,
officer, director, trustee, or representative which  controls, directly or indirectly, Borrower
files, or joins in the filing of, all petition against Borrower under the
Bankruptcy Code or any other Federal or state bankruptcy or insolvency law, or
solicits or causes to be solicited petitioning creditors for any involuntary
petition against Borrower from any Person; (v) intentionally omitted; (vi) Borrower
files an answer consenting to or otherwise acquiescing in or joining in any
involuntary petition filed against it, by any other


 


101














 


Person
under the Bankruptcy Code or any other Federal or state bankruptcy or
insolvency law, or solicits or causes to be solicited petitioning creditors for
any involuntary petition from any Person; (vii) any Affiliate, officer,
director, trustee, or representative which controls Borrower consents to or
acquiesces in or joins in an application for the appointment of a custodian,
receiver, trustee, or examiner for Borrower or any portion of the Property; (viii) Borrower
makes an assignment for the benefit of creditors, or admits, in writing or in
any legal proceeding, its insolvency or inability to pay its debts as they
become due or (ix) Borrower, any SPC Party or any Borrower GP breaches any
of the representations, warranties or covenants applicable to it under Section 3.1.24.


 


Section 11.23       Prior Agreements.  This Agreement and the other Loan Documents contain
the entire agreement of the parties hereto and thereto in respect of the
transactions contemplated hereby and thereby, and all prior agreements among or
between such parties, whether oral or written, are superseded by the terms of
this Agreement and the other Loan Documents.


 


Section 11.24       Servicer. 
(a) 
At the option of Lender, the Loan may be serviced by a servicer (the “Servicer”)
selected by Lender
and Lender may delegate all or any portion of its responsibilities under this
Agreement and the other Loan Documents to the Servicer pursuant to a servicing
agreement (the “Servicing Agreement”) between Lender and Servicer.  Borrower shall not be responsible for any
set-up fees or any other initial costs relating to or arising under the
Servicing Agreement, or for the payment of any monthly servicing fee due to the
Servicer under the Servicing Agreement. 
Servicer shall, however, be entitled to reimbursement of costs and
expenses as and to the same extent (but without duplication) as Lender is
entitled thereto under the applicable provisions of this Agreement and the
other Loan Documents.  In addition,
subject to the express provisions contained elsewhere in this Agreement
(including provisions specifying either an amount, or that no amount, should be payable), Borrower
shall be responsible for the payment of any customary and reasonable servicing
fees charged in connection with any requests made by Borrower during the term of the Loan, including, but not limited
to, approvals, consents, amendments or waivers contemplated by this Agreement or
otherwise.


 


(b)           Upon notice thereof from Lender,
Servicer shall have the right to exercise all rights of Lender and enforce all
obligations of Borrower pursuant to the provisions of this Agreement, the Note
and the other Loan Documents.


 


(c)           Provided Borrower shall have been given notice of Servicer’s
address by Lender, Borrower shall deliver to Servicer duplicate originals of
all notices and other instruments which Borrower may or shall be required to
deliver to Lender pursuant to this Agreement, the Note and the other Loan
Documents (and no delivery of such notices or other installments by Borrower
shall be of any force or effect unless delivered to Lender and Servicer as
provided above).


 


(d)           Notwithstanding anything to the
contrary contained herein or in any other Loan Documents, unless the Loan is
being transferred to a “special servicer” or is then being “specially serviced”
(in which case Borrower may be required to deal with one primary Servicer and
one “special servicer”), Borrower shall be required to deal with only one
Servicer acting on 


 


102

















 


behalf of all Persons
comprising Lender and Cross Lender (the “primary Servicer”), with
respect to any consents, approvals or notices required or permitted from, or
to, Servicer, Lender or Cross Lender pursuant to the Loan Documents (it being
understood that such primary Servicer may need to consult with other Persons
that hold a portion of Lender’s and/or Cross Lender’s rights and obligations
under the Loan or with the Rating Agencies in connection with any such consent,
approval or notice and that a so-called “special servicer” may act as such
primary Servicer).  Lender may replace
such primary Servicer with another primary Servicer at any time in Lender’s
sole discretion.  As of the date hereof,
Wachovia Bank, N.A., in its capacity as servicer under a Servicing Agreement
with Lender, is hereby designated as the primary Servicer and unless and until
Borrower is notified by all Persons comprising Lender of a new primary
Servicer, Borrower shall be permitted to rely conclusively and irrevocably on
such designation.


 


Section 11.25       Joint and Several Liability.  If more than one Person has executed this Agreement as
“Borrower,” the representations, covenants, warranties and obligations of all
such Persons hereunder shall be joint and several.


 


Section 11.26       Creation of Security Interest.  Notwithstanding any other provision set forth in this Agreement, the Note, the
Mortgage or any of the other Loan Documents, Lender may at any time create a
security interest in all or any portion of its rights under this Agreement, the
Note, the Mortgage and any other Loan
Document (including, without limitation, the advances owing to it) in favor of
any Federal Reserve Bank in accordance with Regulation A of the Board of
Governors of the Federal Reserve System.


 


Section 11.27       Assignments and Participations.  (a)  The Lender may assign to one or more Persons
other than (as long as no Event of Default has occurred and is continuing) any
Excluded Lender Transferee all or a portion of its rights and obligations under
this Loan Agreement (it being agreed that the foregoing shall not apply to the
holder of any Securities issued in a pooled-loan Securitization).


 


(b)           Lender may sell participations to one
or more Persons other than (as long as no Event of Default has occurred and is
continuing) any Excluded Lender Transferee in or to all or a portion of its
rights and obligations under this Loan Agreement (it being agreed that the
foregoing shall not apply to the holder of any Securities issued in a
pooled-loan Securitization); provided, however, that (i) Lender’s
obligations under this Loan Agreement shall remain unchanged, (ii) except
as otherwise provided in Section 2.5, Lender shall remain solely
responsible to the other parties hereto for the performance of such
obligations, (iii) Lender shall remain the holder of any Note for all
purposes of this Loan Agreement and (iv) Borrower shall continue to deal
solely and directly with Lender in connection with Lender’s rights and
obligations under and in respect of this Loan Agreement and the other Loan
Documents.


 


(c)           Lender may, in connection with any
assignment or participation or proposed assignment or participation pursuant to
this Section 11.27, disclose to the assignee or participant or
proposed assignee or participant, as the case may be, any information relating
to Borrower or any of its Affiliates or to any aspect of the Loan that has been
furnished to the Lender by or on behalf of the Borrower or any of its
Affiliates, subject to such Person keeping all such information Confidential.


 


103

















 


(d)           Subject to acceptance and recording
thereof pursuant to paragraph (e) of this Section 11.27, from
and after the effective date specified in each Assignment and Acceptance the
assignee thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and obligations of
Lender under this Agreement.  Any
assignment or transfer by Lender of rights or obligations under this Agreement
that does not comply with this Section 11.27 shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with clause (b) of this Section 11.27.


 


(e)           Lender or an agent of Lender shall
maintain a register (the “Register”) on which it will record the Loans
made hereunder, and each Assignment and Acceptance and participation.  The Register shall include the names and
addresses of Lenders (including all assignees, successors and Participants),
and the commitment of, and principal amount of the Loans owing to each such
Lender.  Failure to make any such
recordation, or any error in such recordation shall not affect the Borrower’s
obligations in respect of such Loans.  If
Lender sells an assignment or participation in any Loan, it shall update the
register to reflect such assignment or participation.


 


(f)            Notwithstanding anything contained
herein to the contrary, as long as no Event of Default shall have occurred and
be continuing, no Lender or Participant shall Transfer all or any portion of
the Loan or any interest therein to an Excluded Lender Transferee or permit or
suffer any Transfer such that any portion of or participation interest in the
Loan will be held directly or indirectly by a Person that is an Excluded Lender
Transferee (it being agreed that the foregoing shall not apply to the holder of
any Securities issued in a pooled-loan Securitization).


 


(g)           It shall be a condition to the
Securitization of any portion of the Loan and/or the Cross Loan into different
securitization pools that the Loan and the Cross Loan shall be uncrossed so
that an Event of Default under and as defined in the Cross Loan Agreement shall
no longer be an Event of Default hereunder and that an Event of Default
hereunder shall no longer be a Cross Event of Default, and that the lien of the
Mortgage and the Security Agreement will no longer secure the Cross Loan
pursuant to the Cross Guaranty (as defined in the Cross Loan Agreement) and the
Cross Mortgage and Cross Security Agreement will no longer secure the Loan
pursuant to the Cross Guaranty.


 


(h)           It shall be a condition to the
assignment of more than fifty percent (50%) of the Loan to one or more Persons
which are not Affiliates of Lender and whereby the Loan and the Cross Loan
shall be majority-owned by Persons which are not Affiliates that either (i) the
Loan and the Cross Loan shall be uncrossed so that an Event of Default under
and as defined in the Cross Loan Agreement shall no longer be an Event of
Default hereunder and that an Event of Default hereunder shall no longer be a
Cross Event of Default, and that the lien of the Mortgage and the Security
Agreement will no longer secure the Cross Loan pursuant to the Cross Guaranty
(as defined in the Cross Loan Agreement) and the Cross Mortgage and the Cross
Security Agreement will no longer secure the Loan pursuant to the Cross
Guaranty or (ii) the holders of the Loan and the holders of the Cross Loan
shall enter into a co-lender arrangement pursuant to which one holder of the
Loan or holder of the Cross Loan shall be designated as a directing lender and
shall be the Person designated to act on behalf of the Lender and the Cross
Lender with respect to the Loan and shall have the sole right to receive any
notices which are required to 


 


104

















 


be given to the Lender,
or which are required to be given by the Lender to the Borrower or any other
party pursuant to this Agreement, and to exercise the rights and powers given
to the Lender hereunder, including, without limitation, approval rights,
primary Servicer appointment rights, and the ability to exercise rights and
remedies hereunder.  Promptly after
entering into such co- lender arrangement, notice of the designation of a
directing lender shall be delivered to Borrower, and Borrower shall be entitled
to rely on such designation.  Such
directing lender designation shall be irrevocable without Borrower’s approval
unless and until a replacement directing lender is designated therefor.


 


(i)            Notwithstanding anything to the
contrary contained herein or in any other Loan Document, all reasonable
out-of-pocket costs and expenses actually incurred by Borrower or its
Affiliates in connection with Borrower’s cooperation with Lender in effecting
any of the actions contemplated pursuant to either or both of clauses (g) or
(h) of this Section 11.27 shall be borne by Lender.


 


Section 11.28       Cross Default;
Cross-Collateraltzation.  Borrower acknowledges that Lender has
made the Loan to Borrower upon the additional security of the collateral
securing the Cross Loan and in reliance upon the aggregate of the collateral
securing the Loan and the collateral securing the Cross Loan taken together
being of greater value as collateral security than the sum of the collateral
securing the Loan and the collateral securing the Cross Loan taken separately,
and that the Mortgage and certain other Loan Documents secure both the Loan and
the Cross Guaranty (as defined in the Cross Loan Agreement), and the Cross
Mortgage and certain other Loan Documents (as defined in the Cross Loan
Agreement) secure both the Cross Guaranty and the Cross Loan.  Borrower agrees that the Loan and the Cross
Loan are and will be cross-defaulted with each other so that a Cross Event of
Default shall constitute an Event of Default under the Loan Documents which
secure the Note.  Notwithstanding
anything to the contrary contained herein, Lender in its sole discretion may,
and in such event shall cause Cross Lender to, uncross the Loan with the Cross
Loan at any time, and upon the release of the Cross Borrowers under the Cross
Guaranty and the Borrowers under the Cross Guaranty (as defined in the Cross
Loan Agreement), the foregoing cross-default of the Loan and the Cross Loan
shall terminate and be of no further force or effect such that a Cross Event of
Default shall no longer constitute an Event of Default under the Loan Documents
and an Event of Default under the Loan Documents shall no longer constitute a
Cross Event of Default under and as defined in the Cross Loan Agreement.  Upon the release of the Cross Borrowers under
the Cross Guaranty, and the Borrowers under the Cross Guaranty (as defined in
the Cross Loan Agreement) as provided in this Section 11.28 and in Section 11.28
of the Cross Loan Agreement, Lender and Cross Lender, at their sole cost and
expense, with the cooperation of Borrower and its Affiliates in the Cross Loan,
including Cross Borrowers, shall execute and deliver, or shall cause to be
executed and delivered, such documents and instruments as are
reasonably necessary and appropriate to evidence the same and to effect the release
and discharge of record the lien created by each of the Mortgage and Security
Agreement in favor of the Cross Lender and the Cross Mortgage and the Cross
Security Agreement in favor of Lender, including but not limited to UCC-3
termination statements.  For the purpose
of clarity, upon the release or substitution of an Individual Property pursuant
to this Agreement, such Individual Property shall no longer be collateral for
the benefit of the Cross Lender pursuant to the Cross Guaranty.


 


105

















 


Section 11.29       Substitution.  After the Closing Date, but prior to the Permitted
Prepayment Date, Borrower may obtain a release of the Lien of a Mortgage (and
the related Loan Documents) encumbering an Individual Property (a “Substituted
Property”) by substituting therefor another property of like kind and
quality acquired by Borrower (individually, a “Substitute Property” and collectively,
the “Substitute Properties”), provided that the following
conditions precedent are satisfied:


 


(a)           Lender shall have received at least
thirty (30) days prior written notice requesting the substitution and
identifying the Substitute Property and the Substituted Property.


 


(b)           The Allocated Loan Amount of the
Substituted Property, when taken together with the Allocated Loan Amounts of
all other Substituted Properties substituted pursuant to this Section 11.29,
does not exceed thirty-five percent (35%)
of the original
principal balance of the Loan.


 


(c)           After giving effect to the proposed
substitution, no Event of Default shall be continuing.


 


(d)           The Substitute Property shall not
have suffered a Casualty or Condemnation which has not been fully restored.


 


(e)           If the Loan is part of a
Securitization, Lender shall have received an Appraisal of the Substitute
Property, dated no more than sixty (60) days prior to the substitution date,
prepared by a senior commercial appraiser of the American Appraisal Institute
acceptable to the Rating Agencies.


 


(f)            Intentionally omitted.


 


(g)           Lender shall have received a current
survey for the Substitute Property, certified to the title insurance company
and Lender and their respective successors and assigns, in substantially the
same form and content as the certification of the survey of the Substituted
Property prepared by a professional land surveyor licensed in the state in
which the Substitute Property is located and acceptable to the Rating Agencies,
in accordance with the 1999 Minimum Standard Detail Requirements for ALTA/ACSM
Land Title Surveys.  Such survey shall
reflect the same legal description contained in the title insurance policy
relating to such Substitute Property and shall include, among other things, a metes
and bounds description of the real property comprising part of such Substitute
Property (unless such real property has been satisfactorily designated by lot
number on a recorded plat).  The surveyor’s
seal shall be affixed to such survey and, if customary, such survey shall
certify whether any portion of the surveyed property or the improvements
thereon is located in a “one-hundred-year flood hazard area.”


 


(h)           Lender shall have received a Phase I
environmental report acceptable to a reasonably prudent lender and, if
recommended under the Phase I environmental report, a Phase II environmental
report acceptable to a reasonably prudent lender, which concludes that the
Substitute Property does not contain any Hazardous Substances (as defined in
the Environmental Indemnity) requiring remediation under any Environmental Law
(as defined in the Environmental Indemnity) and is not subject to any known
risk of contamination from any off-site Hazardous Substance.


 


106

















 


(i)            Lender shall have received a
Physical Conditions Report with respect to the Substitute Property stating that
the Substitute Property is in good condition and repair and free of damage or
waste.  If the Physical Conditions Report
recommends that any repairs be made with respect to the Substitute Property,
such Physical Conditions Report shall include an estimate of the cost of such
recommended repairs and, subject to the terms and conditions set forth in Section 6.1.2,
Borrower shall deposit with Lender an amount equal to one hundred fifteen
percent (115%) of such estimated cost in the event such estimated cost exceeds
$50,000, which deposit shall constitute “Required Repair Funds”, and shall be
released to Borrower in accordance with the provisions of Section 6.1.


 


(j)            Lender shall have received evidence
satisfactory to a reasonably prudent lender that the Substitute Property and
its use comply in all material respects with all applicable Legal Requirements
(including, without limitation, zoning, subdivision and building laws) and such
compliance shall be confirmed by delivery to Lender of report from the Planning
and Zoning Resource Corporation or such other similar consultant which in the
ordinary course of its business provides zoning analyses and reports to
institutional lenders.


 


(k)           Lender shall have received valid
certificates of insurance indicating that the requirements for the policies of
insurance required for an Individual Property hereunder have been satisfied
with respect to the Substitute Property and evidence of the payment of all
premiums payable for the existing policy period (or if such Substitute Property
is being added to Borrower’s existing policies, that such amounts have been
escrowed with Lender in accordance with the terms and conditions of Section 6.3).


 


(l)            Intentionally omitted.


 


(m)          Intentionally omitted.


 


(n)           After giving effect to the
substitution, the Debt Service Coverage Ratio for the Loan for the Property
(excluding the Substituted Property and including the Substitute Property) is
not less than the greater of (i) the Debt Service Coverage Ratio as of the
Closing Date and (ii) the Debt Service Coverage Ratio for the trailing
twelve (12) full calendar months as of the date immediately preceding the
substitution; provided that, Borrower shall be permitted to defease a
portion of the Loan in accordance with Section 2.5.2 in order to
satisfy the Debt Service Coverage Ratio test set forth in this clause (n);


 


(o)           (i) The Individual Loan-to-Value
Ratio of the Substitute Property is not greater than the lesser of the
Individual Loan-to-Value Ratio of the Substituted Property (A) as of the
Closing Date and (B) immediately prior to the substitution, which
determination, with respect to (x) the Substitute Property, if based on an
Appraisal pursuant to the definition of “Individual Loan-to-Value Ratio”, shall
be based on the Appraisal described in clause (e) above and, (y) the
Substituted Property, (I) if the determination is as of the Closing Date
and is based on an Appraisal pursuant to the definition of “Individual
Loan-to-Value Ratio”, shall be based on the Appraisal delivered at closing and,
(II) if the determination is as of immediately prior to date of
substitution and is based on an Appraisal pursuant to the definition of “Individual
Loan-to-Value Ratio”, shall be based on a new Appraisal dated no earlier than
ninety (90) days prior to such substitution, or, (ii) if Borrower is
unable to satisfy the foregoing test, after giving effect to 


 


107

















 


such substitution, the
Loan-to-Value Ratio for the Property (excluding the Substituted Property and
including the Substitute Property) is not greater than the lesser of (A) the
Loan-to-Value Ratio as of the Closing Date, which, if based on Appraisals
pursuant to the definition of “Loan-to-Value Ratio”, shall be based on the
Appraisals delivered at closing, and (B) the Loan-to-Value Ratio as of the
date immediately preceding such substitution, which, if based on Appraisals
pursuant to the definition of “Loan-to-Value Ratio”, shall be based on
Appraisals dated no earlier than ninety (90) days prior to the date of such
substitution.


 


(p)           Lender shall have received an Officer’s
Certificate certifying that the representations and warranties of Borrower
contained in this Agreement and the other Loan Documents are true and correct
in all material respects on and as of the date of the substitution with respect
to the Substitute Property and, if the Loan is part of a Securitization,
containing any other representations and warranties with respect to the
Substitute Property as the Rating Agencies may require, such certificate to be
in form and substance satisfactory to the Rating Agencies.


 


(q)           Borrower shall (i) have
executed, acknowledged and delivered to Lender (A) a Mortgage, an
Assignment of Leases and two UCC-1 Financing Statements with respect to the
Substitute Property, together with a letter from Borrower countersigned by a
title insurance company acknowledging receipt of such Mortgage, Assignment of
Leases and UCC-1 Financing Statements and agreeing to record or file, as
applicable, such Mortgage, Assignment of Leases and one of the UCC-1 Financing
Statements in the real estate records for the county in which the Substitute
Property is located and to file one of the UCC-1 Financing Statements in the
office of the Secretary of State (or other central filing office) of the state
of its organization, so as to effectively create upon such recording and filing
valid and enforceable Liens upon the Substitute Property, of the requisite
priority, in favor of Lender (or such other trustee as may be desired under
local law), subject only to the Permitted Encumbrances and such other Liens as
are permitted pursuant to the Loan Documents and (B) an Environmental Indemnity
with respect to the Substitute Property and (ii) have caused Guarantor to
acknowledge and confirm its obligations under (A) any guaranty executed
and delivered by Guarantor in connection with the Loan and (B) the
Environmental Indemnity.  The Mortgage,
Assignment of Leases, UCC-1 Financing Statements and Environmental Indemnity
shall be the same in form and substance as the counterparts of such documents
executed and delivered with respect to the Substituted Property subject to
modifications reflecting the Substitute Property as the Individual Property
that is the subject of such documents and such modifications reflecting the
laws of the state in which the Substitute Property is located as shall be
recommended for similar transactions by the counsel admitted to practice in
such state and delivering the opinion as to the enforceability of such
documents required pursuant to subsection (u) below.  The Mortgage encumbering the Substitute
Property shall secure all amounts evidenced by the Note, provided that
in the event that the jurisdiction in which the Substitute Property is located
imposes a mortgage recording, intangibles or similar tax and does not permit
the allocation of indebtedness for the purpose of determining the amount of
such tax payable, the principal amount secured by such Mortgage shall be equal
to one hundred twenty-five percent (125%) of the Allocated Loan Amount of the
Substitute Property.  The amount of the
Loan allocated to the Substitute Property (such amount being hereinafter referred
to as the “Substitute Allocated Loan Amount”) shall equal the Allocated
Loan Amount of the Substituted Property immediately prior to the substitution
and the Allocated UCF Amount of the Substitute Property shall be equal to the
Allocated UCF Amount 


 


108

















 


of the Substituted
Property immediately prior to the substitution. 
Further, Lender shall, in its reasonable discretion, provide an
Allocated Capital Expenditure Amount for the Substitute Property, which
Allocated Capital Expenditure Amount shall be equal to $0.03 per cubic foot of
such Substitute Property and which, when aggregated with the Allocated Capital
Expenditure Amounts of each remaining Individual Property, shall not exceed the
Capital Expenditure Maximum Amount.  Schedule
VI will be deemed to be modified to reflect any such changes to the
Allocated Loan Amount, Allocated UCF Amount and Allocated Capital Expenditure
Amount for each Individual Property subsequent to a substitution.


 


(r)            Lender shall have received (i) unless
Borrower shall have elected to provide title insurance in an amount equal to
one hundred twenty-five percent (125%) of the Substitute Allocated Loan Amount
as set forth in clause (A) of Section 11.29(q), a “tie-in”
or similar endorsement, but only to the extent available in such jurisdiction,
to each title insurance policy insuring the Lien of an existing Mortgage (which
shall be tied in as of the Closing Date) with respect to such existing
Mortgages and as of the date of the substitution with respect to the title
insurance policy insuring the Lien of the Mortgage with respect to the
Substitute Property and (ii) a title insurance policy (or a marked, signed
and redated commitment to issue such title insurance policy) insuring the Lien
of the Mortgage encumbering the Substitute Property, issued by the title
company that issued the title insurance policies insuring the Lien of the
existing Mortgages and dated as of the date of the substitution, with
reinsurance and direct access agreements that replace such agreements issued in
connection with the title insurance policy insuring the Lien of the Mortgage
encumbering the Substituted Property. 
The title insurance policy issued with respect to the Substitute
Property shall (A) at Borrower’s option, provide coverage in the amount of
the Substitute Allocated Loan Amount if the “tie-in” or similar endorsement
described above is available or, in lieu of a tie-in endorsement, in an amount
equal to one hundred twenty-five percent (125%)
of the Substitute Allocated Loan Amount, (B) insure Lender that the
relevant Mortgage creates a valid first lien on the Substitute Property
encumbered thereby, free and clear of all exceptions from coverage other than
Permitted Encumbrances and standard exceptions and exclusions from coverage (as
modified by the terms of any endorsements), (C) contain such endorsements
and affirmative coverages reasonably requested by Lender, but only to the
extent the same are available in the jurisdiction in which the Substitute
Property is located, and (D) name Lender as the insured.  Lender also shall have received copies of
paid receipts or other evidence showing that all premiums in respect of such
endorsements and title insurance policies have been paid.


 


(s)           Lender shall have received (i) an endorsement to the title insurance
policy insuring the Lien of the Mortgage encumbering the Substitute Property
insuring that the Substitute Property constitutes a separate tax lot or, if
such an endorsement is not available in the state in which the Substitute
Property is located, a letter from the title insurance company issuing such
Title Insurance Policy stating that the Substitute Policy constitutes a
separate tax lot or (ii) a letter from the appropriate taxing authority
stating that the Substitute Property constitutes a separate tax lot or other
evidence satisfactory to a reasonably prudent lender as to same.


 


(t)            Borrower shall deliver or cause to
be delivered to Lender (i) updates certified by Borrower of all
organizational documentation related to Borrower and/or the formation,
structure, existence, good standing and/or qualification to do business
delivered to Lender on the Closing Date; (ii) good standing certificates,
certificates of qualification to do 


 


109

















 


business in the
jurisdiction in which the Substitute Property is located (if required in such
jurisdiction); and (iii) resolutions of Borrower authorizing the
substitution and any actions taken in connection with such substitution.


 


(u)           Lender shall have received the
following opinions of Borrower’s counsel: (i) an opinion or opinions of
counsel, admitted to practice under the laws of the state in which the
Substitute Property is located, stating that the Loan Documents governed by
such state law delivered with respect to the Substitute Property are valid and
enforceable in accordance with their terms, subject to the laws applicable to
creditors’ rights and equitable principles, and that Borrower is qualified to
do business and in good standing under the laws of the jurisdiction where the
Substitute Property is located or that Borrower is not required by applicable
law to qualify to do business in such jurisdiction; (ii) an opinion of
counsel acceptable to the Rating Agencies, if the Loan is part of a
Securitization, or reasonably acceptable to the Lender, if the Loan is not part
of a Securitization, stating that the Loan Documents delivered with respect to
the Substitute Property pursuant to clause (i) above were duly
authorized, executed and delivered by such Borrower; (iii) an opinion of
counsel acceptable to, the Rating Agencies if the Loan is part of a
Securitization, or the Lender if the Loan is not part of a Securitization,
stating either (x) that subjecting the Substitute Property to the Lien of
the related Mortgage and the execution and delivery of the related Loan
Documents do not and will not affect or impair the ability of Lender to enforce
its remedies under all of the Loan Documents or (y) this Agreement, after
giving effect to the Loan Documents executed in connection with the
substitution, shall be enforceable in accordance with its terms; (iv) an
update of the Insolvency Opinion indicating that the substitution does not
affect the opinions set forth therein; and (v) if the Loan is part of a
Securitization, an opinion of counsel acceptable to the Rating Agencies that
the substitution does not constitute a “significant modification” of the Loan
under Section 1001 of the Code or otherwise cause a tax to be imposed on a
“prohibited transaction” by the REMIC Trust holding the Loan.  Such opinions, to the extent applicable,
shall be substantially in the respective forms approved by Lender in connection
with the origination of the Loan, and shall contain customary assumptions and
qualifications.


 


(v)           To the extent such escrows would be
required pursuant to the terms and conditions set forth in Article VI,
Borrower shall have paid, or escrowed with Lender, all Basic Carrying Costs
relating to the Substitute Property, including without limitation, (i) accrued
but unpaid insurance premiums relating to each of the Individual Properties and
the Substitute Property, and (ii) currently due and payable Taxes
(including any in arrears) relating to each of the Individual Properties and the
Substitute Property and (iii) currently due and payable maintenance
charges and other impositions relating to each of the Individual Properties and
Substitute Property after taking into account Reserve Funds held in connection
with the Substituted Property and available as Reserve Funds for the Substitute
Property.


 


(w)          Lender shall have received such other
amendments and modifications to this Agreement and the other Loan Documents as
would be requested by a reasonably prudent lender originating commercial loans
for securitization similar to the Loan in order to reflect and effect the
substitution and to protect and preserve the Liens and security interests of
Lender in the Substitute Property.


 


110














 


(x)            Lender shall have received such
other and further approvals, opinions, documents and information in connection
with the substitution as requested by the Rating Agencies if the Loan is part
of a Securitization.


 


(y)           If the Loan is part of a Securitization,
Borrower shall have delivered to Lender a Rating Agency Confirmation with
respect to the substitution.


 


(z)            Borrower shall convey the
Substituted Property to another Person other than an SPC Party.


 


(aa)         Borrower shall submit to Lender for its
review, not less than fifteen (15) days prior to the date of such substitution,
a release of Lien (and related Loan Documents) for the Substituted Property to
be executed by Lender.  Such release
shall be in a form appropriate for the jurisdiction in which the Substituted
Property is located and that contains standard provisions protecting the rights
of the releasing lender.  In addition,
Borrower shall provide all other documentation that a reasonably prudent lender
originating commercial loans for
securitization similar
to the Loan would require to be delivered by Borrower in connection with such
release, together with an Officer’s Certificate certifying that such
documentation (i) is in compliance with all Legal Requirements, and (ii) will
effect such release in accordance with the terms of this Agreement.


 


(bb)         Borrower shall deliver an Officer’s
Certificate certifying that the requirements set forth in this Section 11.29
have been satisfied.


 


(cc)         Borrower shall have paid or reimbursed
Lender for all reasonable out-of-pocket costs and expenses incurred by Lender
(including, without limitation, reasonable attorneys fees and disbursements) in
connection with the substitution. 
Borrower shall have paid all
recording charges,
filing fees, taxes or other expenses (including, without limitation, mortgage
and intangibles taxes and documentary stamp taxes) payable
in connection with
the substitution.  If the Loan is part of
a Securitization, Borrower shall have paid all costs and expenses of the Rating
Agencies incurred in connection with the substitution.


 


(dd)         Upon the satisfaction of the foregoing
conditions precedent, Lender will release its Lien from the Substituted
Property (or assign such Lien, as applicable) and the Substitute Property shall
be deemed to be an Individual Property for purposes of this Agreement and the
Substitute Allocated Loan Amount with respect to such
Substitute Property
shall be deemed to be the Allocated Loan Amount with respect to such Substitute Property
for all purposes hereunder.


 


Following
the substitution of a Substituted Property in exchange for a Substitute
Property in accordance with this Section 11.29, Lender shall adjust
(if applicable) the amounts thereafter required to be deposited by Borrower
into the Reserve Funds to reflect amounts required solely for the remaining
Individual Properties and the Substitute Property after giving effect to such
substitution.


 


Section 11.30       Partial Release – Expansion.  (a) Provided no Event of Default shall have
occurred and remain uncured and provided that the intended use, at the
time of the transfer of the Expansion Parcel is not for purposes incompatible
with the use and operation of 


 


111

















 


the applicable Individual
Property as a dry and/or cold storage warehouse facility (it being agreed that
the use of the Expansion Parcel as a dry and/or cold storage warehouse facility
is not incompatible with the use and operation of the remainder of the
applicable Individual Property as a dry and/or cold storage warehouse
facility), Borrower shall have the right at any time and from time to time
prior to the Maturity Date to obtain a release of the lien of the Mortgage (and
related Loan Documents) as to an Expansion Parcel upon satisfaction of the
following conditions precedent:


 


(i)            Borrower
shall provide Lender not less than thirty (30) days’ notice (or a shorter
period of time if permitted by Lender in its sole discretion) specifying the
date (the “Expansion Date”) on which the partial release is to occur provided,
however,
that Borrower may
postpone the Expansion Date from time to time as long as the extended date is
at least ten (10) Business Days after Notice of such extension;


 


(ii)           Lender
shall have received an Officer’s Certificate certifying (A) that the
proposed use of the Expansion Parcel would not be incompatible with a dry
and/or cold storage warehouse facility on the remainder of the applicable
Individual Property, (B) that the excess of Gross Revenue over Operating
Expenses for the Individual Property immediately after the proposed release
after taking into account the proposed use of the Expansion Parcel will not be
less than the excess of Gross Revenue over Operating Expenses for the
Individual Property immediately before the proposed release and (C) that
the proposed use of the Expansion Parcel will not have a material adverse
effect on the income and expense at the Individual Property, together with
evidence reasonably acceptable to Lender in support of such conclusions;


 


(iii)          Borrower
shall deliver to Lender an opinion of counsel for Borrower that is standard in
commercial lending transactions and subject only to customary qualifications,
assumptions and exceptions opining, among other things, that if a
Securitization of any portion of the Loan has occurred, the REMIC Trust formed
pursuant to such Securitization will not fail to maintain its status as a “real estate mortgage investment conduit”
within the meaning of Section 860D of the Code as a result of the partial
release pursuant to this Section 11.30;


 


(iv)          Borrower
shall have delivered to Lender evidence that Borrower has complied with all
requirements of and obtained all approvals required under any Leases with Major
Tenants and the Operating Agreements applicable to the release of the Expansion
Parcel and that the partial release does not violate any of the provisions of
any Leases with Major Tenants and the Operating Agreements provided, however,
that an Officer’s Certificate to that effect shall be sufficient evidence
of such compliance and obtaining of such approvals as to Leases which are not
Major Leases;


 


(v)           Borrower
shall have delivered to Lender (A) at Borrower’s option, (x) an
endorsement to the Title Insurance Policy, (y) an opinion of counsel (from
counsel reasonably acceptable to Lender) or (z) a certificate of an
architect (from an architect reasonably acceptable to Lender and licensed to
practice in the State), indicating that the Expansion Parcel has been legally
subdivided for zoning lot purposes from the remainder of the Individual
Property pursuant to a zoning lot subdivision in accordance with 


 


112

















 


applicable law, (B) at Borrower’s option, (x) an endorsement
to the Title Insurance Policy, (y) an opinion of counsel (from counsel
reasonably acceptable to Lender) or (z) a certificate of an architect
(from an architect reasonably acceptable to Lender and licensed to practice in
the State), indicating that the balance of the Individual Property separately
conforms to and is in material compliance with all applicable Legal
Requirements and constitutes one or more separate tax lots, (C) a
certificate from an architect or engineer (licensed to practice in the State
and reasonably acceptable to Lender) to the effect that the Expansion Parcel is
not necessary for the use of the remainder of the Individual Property in the
manner in which it is then being used, including, without limitation, for
support, access, driveways, parking, utilities or drainage flows (after giving
effect to any easements therefor reserved over the Expansion Parcel for the
benefit of the remainder of the Individual Property) and (D) an Officer’s
Certificate with supporting documentation indicating that either (y) sufficient
parking remains on the remainder of the Individual Property to comply with all
Leases of such remainder and with all Operating Agreements and which is
adequate for the proper use and enjoyment of the balance of the Individual
Property or (z) reservations
of parking (in favor of such remainder) in the Expansion Parcel are sufficient
(when added to parking otherwise available to the remainder) to comply with all
Leases of such remainder and with all Operating Agreements and which are
adequate for the proper use and enjoyment of the remainder of the Individual
Property;


 


(vi)          Lender
shall have received a Officer’s
Certificate certifying that any improvements proposed to be built on the
Expansion Parcel will not adversely affect the operation of the remainder of
the Individual Property (after giving effect to any easements reserved or
granted for the benefit of such remainder or the Expansion Parcel);


 


(vii)         Lender
shall have received an Appraisal of the Individual Property (using an income
method of valuation (it being agreed that in conducting such valuation any
income that might be derived from the sale or subsequent use of such Expansion
Parcel shall not be included)) dated no more than ninety (90) days prior to the
proposed Expansion Date by an appraiser (which appraiser shall be reasonably
acceptable to Lender), indicating an appraised value of the Individual Property
after the release, both before and after construction of improvements to be
built on the Expansion Parcel, equal to or greater than the greater of (y) one
hundred percent (100%) of the value of such Individual Property immediately
prior to the release or (z) one hundred percent (100%) of the Allocated
Loan Amount for such Individual Property on the Expansion Date;


 


(viii)        Borrower
shall have delivered a metes and bounds description of the Expansion Parcel and
a survey of the Expansion Parcel and the remainder of the Individual Property
which would be standard in commercial lending transactions;


 


(ix)           Borrower
shall have delivered to Lender on the date of the release an endorsement to the
policy or policies of title insurance insuring the Mortgage on such Individual
Property reflecting the release and (A) insuring Lender’s interest in any
easements created in connection with the Release and (B) confirming no
change in the priority of the Mortgage on the remainder of the Individual
Property or in the amount of the insurance or the coverage under the policy or
policies;


 


113

















 


(x)            Borrower
shall deliver to Lender an Officer’s Certificate certifying that the
requirements set forth in this Section 11.30 have been satisfied;
and


 


(xi)           Borrower
shall pay all out-of-pocket costs and expenses of Lender incurred in connection
with the partial release, including Lender’s reasonably attorneys’ fees and expenses.


 


(b)           If Borrower shall provide a Letter of
Credit to Lender on the Expansion Date as additional security for the Loan, the
amount of the Loan equal to the amount of the Letter of Credit shall be added
to the appraised value of the remainder of the Property after the release for
the purposes of doing the comparison in Section 11.30(a)(vii).


 


(c)           If Borrower has elected to release
the Expansion Parcel and the requirements of this Section 11.30
have been satisfied, the Expansion Parcel
shall be released from the Lien of the Mortgage (and related Loan
Documents) and Lender shall consent and subordinate the Lien of the Mortgage
thereto.  In connection with the release
of the Lien, Borrower shall submit to Lender, not less than thirty (30) days
prior to the Expansion Date (or such shorter time as is reasonably acceptable
to Lender), a release of Lien (and related Loan Documents) for execution by
Lender.  Such release shall be in a form
appropriate in the jurisdiction in which the Property is located and shall
contain standard provisions protecting the rights of a releasing lender.  In addition, Borrower shall provide all other
documentation Lender reasonably requires to be delivered by Borrower in
connection with such release, together with an Officer’s Certificate certifying
that such documentation (i) is in compliance with all Legal Requirements,
and (ii) will effect such release in accordance with the terms of this
Agreement.  Borrower shall pay all costs,
taxes and expenses associated with the release of the Lien of the Mortgage,
including Lender’s reasonable attorneys’ fees. 
Borrower shall cause title to the Expansion Parcel so released from the
Lien of the Mortgage to be transferred to and held by a Person other than
Borrower.


 


[NO FURTHER TEXT ON THIS PAGE]


 


114

















 


IN WITNESS WHEREOF, the
parties hereto have caused this Loan Agreement to be duly executed by their
duly authorized representatives, all as of the day and year first above written


 


	
   

  	
  LENDER:

  
	
   

  	
   

  
	
   

  	
  UBS REAL ESTATE SECURITIES INC.,

  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Christopher Reilly

  
	
   

  	
   

  	
  Name:

  	
  Christopher
  Reilly

  
	
   

  	
   

  	
  Title:

  	
  Managing
  Director

  
	
   

  
	
   

  
	
   

  	
  By:

  	
  /s/
  Jeffrey N. Lavine

  
	
   

  	
   

  	
  Name:

  	
  Jeffrey
  N. Lavine

  
	
   

  	
   

  	
  Title:

  	
  Managing
  Director

  



 

















 


	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  ART
  MORTGAGE BORROWER PROPCO 2006-1B L.P.,

  
	
   

  	
   

  	
  a
  Delaware limited partnership

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  ART
  MORTGAGE BORROWER PROPCO GP

  
	
   

  	
   

  	
   

  	
  2006-1B
  LLC, a Delaware limited
  liability company, its general partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  AMERICOLD
  REALTY TRUST, a Maryland

  
	
   

  	
   

  	
   

  	
  real
  estate investment trust, its sole equity member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  Anthony Cossentino

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  



 


 


	
   

  	
  ART
  MORTGAGE BORROWER OPCO 2006-1B LP.,

  
	
   

  	
   

  	
  a
  Delaware limited partnership

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  ART
  MORTGAGE BORROWER OPCO GP 2006-1B LLC, a Delaware limited liability company,
  its general partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  AMERICOLD
  LOGISTICS, LLC, a Delaware limited liability company, its sole equity member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  Anthony Cossentino

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title: