EX-10.1






SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT




THIS SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”) is made this
16th day of November, 2010 (the “Effective Date”), by and among NNN VF FOUR
RESOURCE SQUARE, LLC, a Delaware limited liability company (“Borrower”), NNN 2003 VALUE
FUND, LLC, a Delaware limited liability company (“Guarantor”), and RAIT PARTNERSHIP, L.P.,
a Delaware limited partnership (together with its successors and assigns, “Lender”).



RECITALS




A. Borrower and Lender entered into that certain Loan and Security Agreement dated March 7,
2007 (the “Original Loan Agreement”), pursuant to which Lender made a loan (the
“Loan”) to Borrower in the original principal amount of Twenty-Three Million and 00/100
Dollars ($23,000,000.00). The Loan is evidenced by that certain Promissory Note dated March 7,
2007 (“Note”), in the original principal amount of Twenty-Three Million and 00/100 Dollars
($23,000,000.00).



B. In connection with the Loan, Borrower, Guarantor and Lender entered into that certain First
Amendment to Loan and Security Agreement dated effective as of March 7, 2010 (the “First
Amendment” and together with the Original Loan Agreement, the “Loan Agreement”), which
First Amendment modified the Original Loan Agreement as more particularly set forth therein.



C. Borrower and Guarantor have requested that Lender agree to amend the Loan Agreement in
certain respects; and, in accordance with such request, Lender has agreed to amend the Loan
Agreement, subject to the terms and conditions of this Amendment. Capitalized terms used herein
and not otherwise defined herein shall have the meanings set forth in the Loan Agreement.



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



A. AMENDMENTS




1. Amendment to Section 1(d) of the Loan Agreement. Effective as of the Effective Date,
Section 1(d) of the Loan Agreement is hereby deleted in its entirety and replaced with the
following:



“(d) Principal Maturity. The outstanding principal balance of the Loan, including all
accrued Interest and any and all amounts owing or to be owing by Borrower or any obligor under the
Loan Documents now or hereafter arising (the “Debt”), will be due on the Maturity Date (as
hereafter defined). For purposes hereof, the “Maturity Date” means the earlier of (i) the
Scheduled Maturity Date (as hereinafter defined); and (ii) the date on which the Debt becomes due
and payable, whether by acceleration or otherwise. For purposes hereof, the “Scheduled
Maturity Date” means January 20, 2011.”



2. Section 1(e)(i) of the Loan Agreement. Effective as of the Effective Date, Section
1(e)(i) of the Loan Agreement is hereby deleted in its entirety and replaced with the
following:



“(i) Voluntary Prepayment. Voluntary Prepayment. Except as otherwise
expressly set forth herein, the Loan may not be prepaid, in whole or in part, prior to the date
that is one year from the date hereof (“Lockout Date”). At any time on or after the
Lockout Date, Borrower may prepay the Loan, in whole but not in part, without prepayment premium or
fee, at any time, upon not less than forty-five (45) days’ prior written notice to Lender, and
subject to the payment of any accrued interest and fees. Notwithstanding the foregoing, Borrower
may prepay the Loan in an amount not less than $2,000,000.00 but not greater than $3,500,000.00 (a
“Partial Prepayment”) prior to the Lockout Date, without prepayment premium or fee, upon
not less than forty-five (45) days’ prior written notice to Lender, and subject to the payment of
any accrued interest and fees. Upon a Partial Prepayment, the Spread (as defined in Section
1(b) above) shall be reduced by 30 basis points to equal 200 basis points.”



3. Section 1(f) of the Loan Agreement. Effective as of the Effective Date, Borrower and
Guarantor acknowledge and agree that no further extension of the Loan shall be permitted. In
furtherance of the foregoing, Section 1(f) of the Loan Agreement is hereby deleted in its
entirety.



4. Amendment to Section 18 of the Loan Agreement. Effective as of the Effective Date, the
following provision shall be inserted as Section 18 of the Loan Agreement:



“18. Additional Covenants.



(a) Debt Service Coverage Ratio; Certain Actions. The Property shall at all times
support a minimum Debt Service Coverage Ratio (as hereinafter defined) of 1.40:1.00 (the “DSCR
Threshold”). Lender, in its sole discretion, may at any time reasonably determine the Debt
Service Coverage Ratio. If, at any time, the Property fails to support a Debt Service Coverage
Ratio equal to or greater than the DSCR Threshold (a “DSCR Trigger Event”), as reasonably
determined by Lender, then Lender may (in Lender’s sole and absolute discretion, and without any
obligation to do so) exercise any one or more of the following rights and remedies (each
separately, and collectively, the “DSCR Trigger Event Action”) for so long as any DSCR
Trigger Event is continuing:



(i) Designate or select an exclusive leasing agent to lease all or any portion of the Property
and/or engage and hire one or more leasing agents selected by Lender (in Lender’s sole and absolute
discretion) to lease all or any portion of the Property;



(ii) Enter into contracts with respect to any of the foregoing matters in subsection (i) above
(including, without limitation, DSCR Trigger Event Documents (as hereinafter defined)), to contract
with any party with respect to the leasing of all or any portion of the Property and/or to
terminate any such contracts; and



(iii) Negotiate a leasing agreement between Borrower and a leasing agent satisfactory to
Lender in its sole discretion pursuant to which Lender, as an agent of Borrower and named third
party beneficiary to the leasing agreement, will have the agency and authority to make all
decisions with respect to the leasing of all or any portion of the Property.



The rights and remedies set forth in subsections 18(a)(i), (ii) and (iii) above are in
addition to any and all rights and remedies conferred upon Lender by the Loan Agreement and the
other Loan Documents, as amended hereby, or otherwise at law or in equity. In furtherance of the
rights and remedies granted to Lender pursuant to subsections 18(a)(i), (ii) and (iii) above,
Borrower covenants and agrees that, upon request from Lender, Borrower shall promptly perform such
acts and take such action as necessary to perform and/or accomplish the DSCR Trigger Event Action
requested by Lender, and Borrower shall promptly (but in no event later than five (5) Business Days
following Lender’s request) execute, acknowledge and deliver any and all instruments, agreements
and documents (including, without limitation, DSCR Trigger Event Documents), and do any and all
other things necessary or appropriate to effectuate the DSCR Trigger Event Action requested by
Lender. Failure by Borrower to comply with any of the covenants set forth in the preceding
sentence shall, at the discretion of Lender, constitute an Event of Default (without any notice or
cure periods) under the Loan Agreement at the discretion of Lender; provided that the occurrence of
a DSCR Trigger Event, in and of itself, shall not constitute an Event of Default.



(b) Power of Attorney. Notwithstanding, and without limiting, anything in
Section 18(a) above, in furtherance of the rights and remedies granted to Lender pursuant
to subsections 18(a)(i), (ii) and (iii), Borrower hereby irrevocably constitutes and appoints
Lender with full power of substitution, as its true and lawful attorney-in-fact and agent, in its
name, place and stead to make, execute, acknowledge and, if necessary, to file and record any
document, agreement or other instruments which may be required in good faith in order to perform
and/or accomplish any DSCR Trigger Event Action, including, without limitation, leases, subleases,
broker agreements, leasing commission agreements, termination agreements, any other instruments or
documents relating to the leasing of the Property, and other contracts, documents, papers and
instruments in writing of whatever kind and nature in connection with the performance and/or
accomplishment of any DSCR Trigger Event Action (collectively, the “DSCR Trigger Event
Documents”). The power of attorney granted hereunder shall be deemed irrevocable and be coupled
with an interest.



(c) Protective Advances. All sums expended by Lender in accordance with this
Section 18 shall be deemed to be advanced to Borrower on the date that such sums were
expended and, at Lender’s discretion, (i) advances of Loan proceeds that accrue interest from the
date that such sums were expended or (ii) protective advances, expended or incurred for the
reasonable protection of the security interest hereby created in the Property and secured by the
Deed of Trust; provided that any such protective advance made in connection with this Section
18 shall not constitute an Event of Default, nor cause the outstanding Debt, or any portion
thereof, to accrue interest at the Default Rate.



As used herein, the term “Debt Service Coverage Ratio” shall mean, for the 12-month
period immediately preceding the date of determination, the ratio of (A) Net Cash Flow generated by
the Property to (B) the total required debt service payments owed by Borrower under the Loan for
such period. “Net Cash Flow” means any and all operating revenues (to be determined by
annualizing the rent roll from the Property) from the Property, less Operating Expenses.
As used herein, the term “Operating Expenses” shall mean normalized trailing 12 month
property expenses (as such may be reasonably determined by Lender), exclusive of actual
expenditures or reserves as it relates to tenant improvements, leasing commissions and capital
improvements.”



B. CONDITIONS TO EFFECTIVENESS 




Lender shall have no obligation to execute this Amendment and/or to perform its obligations
hereunder (and this Amendment shall not be enforceable against Lender) unless and until each of the
following conditions (collectively, the “Amendment Conditions”) is satisfied to Lender’s
reasonable satisfaction:



1. No Event of Default. As of the date of satisfaction of all of the other Amendment
Conditions, no Event of Default has occurred and is continuing under any of the Loan Documents and
no condition exists that, with the passing of time or giving of notice, or both, would result in an
Event of Default under any of the Loan Documents;



2. Ratification of Guaranty. Guarantor shall execute and deliver to Lender the
Reaffirmation of Obligations, a form of which is attached as Exhibit “A” hereto and made
part hereof;



3. Additional Documentation. Borrower and Guarantor shall execute and deliver or
cause to be executed and delivered to Lender, at Borrower’s sole cost and expense, any and all
other documents, agreements, corporate resolutions, certificates and opinions as Lender shall
reasonably request in connection with the execution and delivery of this Amendment or any documents
in connection herewith, or to further evidence, effect, enforce or protect any of the terms hereof
or the rights or remedies granted or intended to be granted to Lender herein or therein, each of
which shall be in form and content acceptable to Lender; and



4. Execution of this Amendment. Borrower and Guarantor have executed and delivered
originals of this Amendment to Lender.



In the event that Borrower and Guarantor have not satisfied any or all of the Amendment
Conditions on or before the Effective Date, then this Amendment shall be null, void and of no
further force and effect.



C. REPRESENTATIONS




1. Borrower and Guarantor each hereby represents and warrants to Lender that:



(a) The execution, delivery and performance by Borrower and Guarantor of this Amendment
(i) are within Borrower’s and Guarantor’s power; (ii) have been duly authorized by all necessary
limited liability company action; (iii) are not in contravention of any provision of Borrower’s or
Guarantor’s certificate of formation or operating agreement or other organizational documents;
(iv) do not violate any law or regulation, or any order or decree of any governmental authority;
(v) do not conflict with or result in the breach or termination of, constitute a default under or
accelerate any performance required by, any indenture, mortgage, deed of trust, lease, agreement or
other instrument to which Borrower and/or Guarantor is a party or by which Borrower, Guarantor, or
any of their respective property is bound; (vi) do not result in the creation or imposition of any
lien upon any of the property of Borrower or Guarantor other than those in favor of Lender pursuant
to the Loan Documents; and (vii) do not require the consent or approval of any governmental
authority or any other person or entity; and



(b) This Amendment has been duly executed and delivered for the benefit of or on behalf of
Borrower and Guarantor and constitutes a legal, valid and binding obligation of Borrower and
Guarantor enforceable against Borrower and Guarantor in accordance with its terms except as the
enforceability hereof may be limited by bankruptcy, insolvency, reorganization, moratorium and
other laws affecting creditors’ rights and remedies in general.



2. Borrower represents and warrants to Lender that:



(a) All representations and warranties of Borrower contained in the Loan Documents (including,
without limitation, the Loan Agreement and the Note) are true, accurate and correct on and as of
the date hereof as if made on and as of the date hereof; and



(b) Both before and after giving effect to this Amendment, no Event of Default or event which,
with the giving of notice or the passage of time or both, would constitute an Event of Default has
occurred and is continuing.



D. OTHER AGREEMENTS




1. Continuing Effectiveness of Loan Documents. As amended hereby, all terms of the
Loan Agreement, the Note and the other Loan Documents shall be and remain in full force and effect
and shall constitute the legal, valid, binding and enforceable obligations of the parties thereto
(all of which are hereby reaffirmed by Borrower and Guarantor). To the extent any terms and
conditions in any of the other Loan Documents shall contradict or be in conflict with any terms or
conditions of the Loan Agreement or the Note, after giving effect to this Amendment, such terms and
conditions are hereby deemed modified and amended accordingly to reflect the terms and conditions
of the Loan Agreement and the Note as modified and amended hereby. All references to the “Loan
Agreement” therein or in any other Loan Documents shall be deemed to be a reference to the Loan
Agreement as amended hereby. All references to the “Note” therein or in any other Loan Documents
shall be deemed to be a reference to the Note as amended hereby.



2. Acknowledgment of Perfection of Security Interest. Borrower hereby acknowledges
that, as of the date hereof, the security interests and liens granted to Lender under the Loan
Agreement, the Deed of Trust, the Pledge Agreement, the Note and/or the other Loan Documents are in
full force and effect, are properly perfected and are enforceable in accordance with the terms of
the Loan Agreement, the Deed of Trust, the Pledge Agreement, the Note and the other Loan Documents,
except to the extent such enforceability may be limited by bankruptcy, insolvency or other similar
laws of general application affecting the enforcement of creditor’s rights.



3. Effect of Agreement. Except as expressly set forth herein, all terms of the Loan
Agreement and the Note, as amended hereby, and the other Loan Documents shall be and remain in full
force and effect and shall constitute the legal, valid, binding and enforceable obligations of the
Borrower and Guarantor, as applicable, to Lender. Except as expressly set forth herein, the
execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right,
power or remedy of Lender under the Loan Agreement, nor constitute a waiver of any provision of the
Loan Agreement. This Amendment shall constitute a Loan Document for all purposes of the Loan
Agreement. Borrower’s failure to comply with or perform any of its covenants, agreements or
obligations contained in this Amendment shall constitute an Event of Default.



4. Governing Law. This Amendment shall be governed by, and construed in accordance
with, the internal laws of the Commonwealth of Pennsylvania and all applicable federal laws of the
United States of America.



5. Counterparts. This Amendment may be executed by one or more of the parties hereto
in any number of separate counterparts, each of which shall be deemed an original and all of which,
taken together, shall be deemed to constitute one and the same instrument. Delivery of an executed
counterpart of this Amendment by facsimile transmission shall be as effective as delivery of a
manually executed counterpart hereof.



6. Challenge to Enforcement. Borrower and Guarantor acknowledge and agree that they
currently have no defense, set-off, counterclaim or challenge against the payment of any sums owing
under the Loan Documents (including, without limitation, the Loan Agreement and the Note), or the
enforcement of any of the terms or conditions thereof.



7. Binding Nature. This Amendment shall be binding upon and inure to the benefit of
the parties hereto, their respective successors, successors-in-titles, and assigns.



8. Entire Understanding. This Amendment sets forth the entire understanding of the
parties with respect to the matters set forth herein, and shall supersede any prior negotiations or
agreements, whether written or oral, with respect thereto.



9. Recitals. Borrower and Guarantor do hereby ratify, confirm and acknowledge that
the statements contained in the foregoing Recitals clauses are true, correct and complete in all
respects and that the Loan Documents are valid, binding and in full force and effect as of the date
hereof, and are fully enforceable against Borrower and Guarantor, as applicable, in accordance with
their terms. The Recitals are hereby incorporated herein and made a part hereof by this reference
as if fully set forth in this Amendment.



10. No Accord or Satisfaction. Neither this Amendment nor any other agreement in
connection herewith or pursuant to the terms hereof shall be deemed or construed to be a
compromise, satisfaction, accord and satisfaction, novation or release of any of the Loan Documents
(including, without limitation, the Loan Agreement and/or the Note), or any rights or obligations
thereunder, or a waiver by Lender of any of its rights under the Loan Documents or at law or in
equity. Nothing contained herein, nor any actions taken pursuant to the terms hereof constitutes a
release, termination or waiver of any liens, security interests, rights or remedies granted to
Lender in any of the Loan Documents (including, without limitation, the Loan Agreement and the
Note), which liens, security interests, rights and remedies are hereby ratified, confirmed,
extended and continued as security for all of the Debt.



11. Outstanding Principal Amount of the Loan. Borrower and Guarantor acknowledge and
agree that as of the close of business on the date immediately preceding the Effective Date, the
outstanding principal amount of the Loan is $21,888,005.16.



[SIGNATURES APPEAR ON FOLLOWING PAGE]





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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the Effective Date.



BORROWER:



NNN VF FOUR RESOURCE SQUARE, LLC,


a Delaware limited liability company



By: NNN 2003 VALUE FUND, LLC,


a Delaware limited liability company



By: Grubb & Ellis Realty Investors, LLC,





a Virginia limited liability company



Its: Manager



By: /s/ Jeffrey T. Hanson

Name: Jeffrey T. Hanson

Title: President





GUARANTOR:



By: NNN 2003 VALUE FUND, LLC,





a Delaware limited liability company



By: Grubb & Ellis Realty Investors, LLC,


a Virginia limited liability company



Its: Manager



By: /s/ Jeffrey T. Hanson

Name: Jeffrey T. Hanson

Title: President





LENDER:



RAIT PARTNERSHIP, L.P.,





a Delaware limited partnership



By: RAIT General, Inc., a Maryland


corporation, its general partner



By: /s/ Kenneth R. Frappier

Name: Kenneth R. Frappier

Title: Executive Vice President



:



REAFFIRMATION OF OBLIGATIONS




The undersigned, intending to be legally bound hereby, consents and agrees to the Second
Amendment to Loan and Security Agreement to which this Reaffirmation of Obligations is attached.
The undersigned expressly reaffirms and ratifies, and further agrees that such Second Amendment to
Loan and Security Agreement shall in no way adversely affect or impair, the obligations and
liabilities of the undersigned under (i) that certain Guaranty of Non-Recourse Carveouts dated
March 7, 2007 (as the same may be amended from time to time), made by Guarantor in favor of Lender;
(ii) that certain Environmental Indemnity Agreement dated March 7, 2007 (as the same may be amended
from time to time) executed by Borrower, and Guarantor in favor of Lender; (iii) any other
documents executed or delivered pursuant thereto or in connection therewith; or (iv) any other Loan
Documents, all of which are hereby ratified, approved and confirmed by the undersigned.



Executed and Effective as of November 16, 2010



NNN 2003 VALUE FUND, LLC,


a Delaware limited liability company



By: Grubb & Ellis Realty Investors, LLC,


a Virginia limited liability company



Its: Manager



By: /s/ Jeffrey T. Hanson

Name: Jeffrey T. Hanson

Title: President





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