exv10w16



 






Exhibit 10.16




EXECUTION COPY



 



CREDIT AGREEMENT


Dated as of November 21, 2005


by and among


GOVERNMENT PROPERTIES TRUST, INC.,

as Borrower


WACHOVIA CAPITAL MARKETS, LLC,

as Arranger,


WACHOVIA BANK, NATIONAL ASSOCIATION,

as Administrative Agent,


and


THE FINANCIAL INSTITUTIONS INITIALLY SIGNATORY HERETO

AND THEIR ASSIGNEES PURSUANT TO SECTION 13.5.,


as Lenders


 





 









 






TABLE OF CONTENTS




	 	 	 	 	 
	Article I. Definitions
	 	 	1	 
	 
	 	 	 	 
	Section 1.1. Definitions
	 	 	1	 
	Section 1.2. General; References to Times
	 	 	25	 
	Section 1.3. Financial Attributes of Non-Wholly Owned Subsidiaries
	 	 	26	 
	 
	 	 	 	 
	Article II. Credit Facility
	 	 	26	 
	 
	 	 	 	 
	Section 2.1. Revolving Loans
	 	 	26	 
	Section 2.2. Swingline Loans
	 	 	27	 
	Section 2.3. Letters of Credit
	 	 	29	 
	Section 2.4. Rates and Payment of Interest on Loans
	 	 	33	 
	Section 2.5. Number of Interest Periods
	 	 	34	 
	Section 2.6. Repayment of Loans
	 	 	34	 
	Section 2.7. Prepayments
	 	 	34	 
	Section 2.8. Continuation
	 	 	35	 
	Section 2.9. Conversion
	 	 	35	 
	Section 2.10. Notes
	 	 	35	 
	Section 2.11. Voluntary Reductions of the Commitment
	 	 	36	 
	Section 2.12. Extension of Termination Date
	 	 	36	 
	Section 2.13. Expiration or Maturity Date of Letters of Credit Past Termination Date
	 	 	37	 
	Section 2.14. Amount Limitations
	 	 	37	 
	Section 2.15. Increase of Commitments
	 	 	37	 
	 
	 	 	 	 
	Article III. Payments, Fees and Other General Provisions
	 	 	38	 
	 
	 	 	 	 
	Section 3.1. Payments
	 	 	38	 
	Section 3.2. Pro Rata Treatment
	 	 	38	 
	Section 3.3. Sharing of Payments, Etc.
	 	 	39	 
	Section 3.4. Several Obligations
	 	 	40	 
	Section 3.5. Minimum Amounts
	 	 	40	 
	Section 3.6. Fees
	 	 	40	 
	Section 3.7. Computations
	 	 	42	 
	Section 3.8. Usury
	 	 	42	 
	Section 3.9. Agreement Regarding Interest and Charges
	 	 	42	 
	Section 3.10. Statements of Account
	 	 	43	 
	Section 3.11. Defaulting Lenders
	 	 	43	 
	Section 3.12. Taxes
	 	 	44	 
	 
	 	 	 	 
	Article IV. Collateral Properties
	 	 	46	 
	 
	 	 	 	 
	Section 4.1. Eligibility of Properties
	 	 	46	 
	Section 4.2. Conditions Precedent to a Property Becoming a Collateral Property
	 	 	48	 
	Section 4.3. Release of Collateral Properties
	 	 	51	 
	Section 4.4. Frequency of Calculations of Borrowing Base
	 	 	52	 
	Section 4.5. Frequency of Appraisals
	 	 	53	 






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	Section 4.6. Additional Appraisals Required under Applicable Law
	 	 	53	 
	Section 4.7. Release of Derivatives Contract
	 	 	54	 
	Section 4.8. Additional Provision Applicable to the NY Properties
	 	 	54	 
	 
	 	 	 	 
	Article V. Yield Protection, Etc.
	 	 	55	 
	 
	 	 	 	 
	Section 5.1. Additional Costs; Capital Adequacy
	 	 	55	 
	Section 5.2. Suspension of LIBOR Loans
	 	 	57	 
	Section 5.3. Illegality
	 	 	57	 
	Section 5.4. Compensation
	 	 	58	 
	Section 5.5. Treatment of Affected Loans
	 	 	58	 
	Section 5.6. Change of Lending Office
	 	 	59	 
	Section 5.7. Assumptions Concerning Funding of LIBOR Loans
	 	 	59	 
	 
	 	 	 	 
	Article VI. Conditions Precedent
	 	 	59	 
	 
	 	 	 	 
	Section 6.1. Initial Conditions Precedent
	 	 	59	 
	Section 6.2. Conditions Precedent to All Loans and Letters of Credit
	 	 	62	 
	 
	 	 	 	 
	Article VII. Representations and Warranties
	 	 	62	 
	 
	 	 	 	 
	Section 7.1. Representations and Warranties
	 	 	62	 
	Section 7.2. Survival of Representations and Warranties, Etc.
	 	 	68	 
	 
	 	 	 	 
	Article VIII. Affirmative Covenants
	 	 	69	 
	 
	 	 	 	 
	Section 8.1. Preservation of Existence and Similar Matters
	 	 	69	 
	Section 8.2. Compliance with Applicable Law and Material Contracts
	 	 	69	 
	Section 8.3. Maintenance of Property
	 	 	69	 
	Section 8.4. Conduct of Business
	 	 	70	 
	Section 8.5. Insurance
	 	 	70	 
	Section 8.6. Payment of Taxes and Claims
	 	 	70	 
	Section 8.7. Visits and Inspections
	 	 	70	 
	Section 8.8. Use of Proceeds; Letters of Credit
	 	 	71	 
	Section 8.9. Environmental Matters
	 	 	71	 
	Section 8.10. Books and Records
	 	 	71	 
	Section 8.11. Further Assurances
	 	 	71	 
	Section 8.12. New Subsidiaries/Guarantors
	 	 	72	 
	Section 8.13. REIT Status
	 	 	72	 
	Section 8.14. Exchange Listing
	 	 	72	 
	 
	 	 	 	 
	Article IX. Information
	 	 	73	 
	 
	 	 	 	 
	Section 9.1. Quarterly Financial Statements
	 	 	73	 
	Section 9.2. Year-End Statements
	 	 	73	 
	Section 9.3. Compliance Certificate
	 	 	73	 
	Section 9.4. Other Information
	 	 	74	 
	Section 9.5. Electronic Delivery
	 	 	76	 
	 
	 	 	 	 
	Article X. Negative Covenants
	 	 	76	 
	 
	 	 	 	 
	Section 10.1. Financial Covenants
	 	 	77	 
	Section 10.2. Restricted Payments
	 	 	77	 






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	Section 10.3. Indebtedness
	 	 	78	 
	Section 10.4. Investments
	 	 	78	 
	Section 10.5. Liens; Negative Pledges; Other Matters
	 	 	79	 
	Section 10.6. Merger, Consolidation, Sales of Assets and Other Arrangements
	 	 	79	 
	Section 10.7. Fiscal Year
	 	 	80	 
	Section 10.8. Modifications to Material Contracts
	 	 	80	 
	Section 10.9. Modifications of Organizational Documents
	 	 	80	 
	Section 10.10. Transactions with Affiliates
	 	 	81	 
	Section 10.11. ERISA Exemptions
	 	 	81	 
	 
	 	 	 	 
	Article XI. Default
	 	 	81	 
	 
	 	 	 	 
	Section 11.1. Events of Default
	 	 	81	 
	Section 11.2. Remedies Upon Event of Default
	 	 	84	 
	Section 11.3. Remedies Upon Default
	 	 	86	 
	Section 11.4. Allocation of Proceeds
	 	 	86	 
	Section 11.5. Collateral Account
	 	 	87	 
	Section 11.6. Performance by Agent
	 	 	87	 
	Section 11.7. Rights Cumulative
	 	 	88	 
	 
	 	 	 	 
	Article XII. The Agent
	 	 	88	 
	 
	 	 	 	 
	Section 12.1. Authorization and Action
	 	 	88	 
	Section 12.2. Agent’s Reliance, Etc.
	 	 	89	 
	Section 12.3. Notice of Defaults
	 	 	89	 
	Section 12.4. Wachovia as Lender
	 	 	90	 
	Section 12.5. Approvals of Lenders
	 	 	90	 
	Section 12.6. Lender Credit Decision, Etc.
	 	 	90	 
	Section 12.7. Collateral Matters
	 	 	91	 
	Section 12.8. Indemnification of Agent
	 	 	92	 
	Section 12.9. Successor Agent
	 	 	93	 
	Section 12.10. Titled Agents
	 	 	93	 
	 
	 	 	 	 
	Article XIII. Miscellaneous
	 	 	94	 
	 
	 	 	 	 
	Section 13.1. Notices
	 	 	94	 
	Section 13.2. Expenses
	 	 	95	 
	Section 13.3. Setoff
	 	 	95	 
	Section 13.4. Litigation; Jurisdiction; Other Matters; Waivers
	 	 	96	 
	Section 13.5. Successors and Assigns
	 	 	97	 
	Section 13.6. Amendments
	 	 	100	 
	Section 13.7. Nonliability of Agent and Lenders
	 	 	101	 
	Section 13.8. Confidentiality
	 	 	101	 
	Section 13.9. Indemnification
	 	 	102	 
	Section 13.10. Termination; Survival
	 	 	105	 
	Section 13.11. Severability of Provisions
	 	 	105	 
	Section 13.12. GOVERNING LAW
	 	 	105	 
	Section 13.13. Patriot Act
	 	 	105	 
	Section 13.14. Counterparts
	 	 	105	 






- iii -









 






	 	 	 	 	 
	Section 13.15. Obligations with Respect to Loan Parties
	 	 	106	 
	Section 13.16. Limitation of Liability
	 	 	106	 
	Section 13.17. Entire Agreement
	 	 	106	 
	Section 13.18. Construction
	 	 	106	 






	 	 	 
	SCHEDULE 1.1.(A)

	 	List of Loan Parties
	SCHEDULE 4.1.

	 	Initial Collateral Properties
	SCHEDULE 7.1.(b)

	 	Ownership Structure
	SCHEDULE 7.1.(f)

	 	Title to Properties; Liens
	SCHEDULE 7.1.(g)

	 	Indebtedness and Guaranties
	SCHEDULE 7.1.(h)

	 	Material Contracts
	SCHEDULE 7.1.(i)

	 	Litigation
	SCHEDULE 7.1.(p)

	 	Environmental Reports
	 
	 	 
	EXHIBIT A

	 	Form of Assignment and Acceptance Agreement
	EXHIBIT B

	 	Form of Notice of Borrowing
	EXHIBIT C

	 	Form of Notice of Continuation
	EXHIBIT D

	 	Form of Notice of Conversion
	EXHIBIT E

	 	Form of Notice of Swingline Borrowing
	EXHIBIT F

	 	Form of Swingline Note
	EXHIBIT G

	 	Form of Revolving Note
	EXHIBIT H

	 	Form of Opinion of Counsel
	EXHIBIT I

	 	Form of Compliance Certificate
	EXHIBIT J

	 	Form of Guaranty
	EXHIBIT K

	 	Form of Security Deed
	EXHIBIT L

	 	Form of Assignment of Leases and Rents
	EXHIBIT M

	 	Form of Environmental Indemnity Agreement
	EXHIBIT N

	 	Form of Assignment of Contracts, Documents and Rights
	EXHIBIT O

	 	Form of Property Management Contract Assignment
	EXHIBIT P

	 	Form of Collateral Assignment of Interest Rate Protection Agreement
	EXHIBIT Q

	 	Form of Pledge Agreement







- iv -









 






     THIS CREDIT AGREEMENT (this “Agreement”) dated as of November 21, 2005 by and among
GOVERNMENT PROPERTIES TRUST, INC., a corporation formed under the laws of the State of Maryland
(the “Borrower”), WACHOVIA CAPITAL MARKETS, LLC, as Arranger (the “Arranger”), WACHOVIA BANK,
NATIONAL ASSOCIATION, as Agent, and each of the financial institutions initially a signatory hereto
together with their assignees pursuant to Section 13.5.(d).



     WHEREAS, the Agent and the Lenders desire to make available to the Borrower a secured
revolving credit facility in the initial amount of $50,000,000, which will include a $20,000,000
letter of credit subfacility and a $20,000,000 swingline subfacility, on the terms and conditions
contained herein (as such amounts may be decreased pursuant to Section 2.11. or increased pursuant
to Section 2.15. in accordance with the terms of this Agreement).



     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by the parties hereto, the parties hereto agree as follows:



Article I. Definitions




Section 1.1. Definitions.




     In addition to terms defined elsewhere herein, the following terms shall have the following
meanings for the purposes of this Agreement:



     “Accession Agreement” means an Accession Agreement substantially in the form of Annex I to the
Guaranty.



     “Additional Costs” has the meaning given that term in Section 5.1.



     “Adjusted EBITDA” means, for any given period, (a) the EBITDA of the Borrower and its
Subsidiaries determined on a consolidated basis for such period, minus (b) Capital Reserves
for such period.



     “Adjusted LIBOR” means, with respect to each Interest Period for any LIBOR Loan, the rate
obtained by dividing (a) LIBOR for such Interest Period by (b) a percentage equal to 1 minus the
stated maximum rate (stated as a decimal) of all reserves, if any, required to be maintained with
respect to Eurocurrency funding (currently referred to as “Eurocurrency liabilities”) as specified
in Regulation D of the Board of Governors of the Federal Reserve System (or against any other
category of liabilities which includes deposits by reference to which the interest rate on LIBOR
Loans is determined or any applicable category of extensions of credit or other assets which
includes loans by an office of any Lender outside of the United States of America to residents of
the United States of America). Any change in such maximum rate shall result in a change in Adjusted
LIBOR on the date on which such change in such maximum rate becomes effective.



     
“Affiliate” means any Person (other than the Agent or any Lender): (a) directly or indirectly
controlling, controlled by, or under common control with, the Borrower; (b) directly or indirectly
owning or holding ten percent (10.0%) or more of any Equity Interest in the Borrower;



 









 




or (c) ten percent (10.0%) or more of whose voting stock or other Equity Interest is directly or
indirectly owned or held by the Borrower. For purposes of this definition, “control” (including
with correlative meanings, the terms “controlling”, “controlled by” and “under common control
with”) means the possession directly or indirectly of the power to direct or cause the direction of
the management and policies of a Person, whether through the ownership of voting securities or by
contract or otherwise. The Affiliates of a Person shall include any officer or director of such
Person. In no event shall the Agent or any Lender be deemed to be an Affiliate of the Borrower.




     “Agent” means Wachovia Bank, National Association, as contractual representative for the
Lenders under the terms of this Agreement, and any of its successors.



     “Agreement Date” means the date as of which this Agreement is dated.



     “Applicable Law” means all applicable provisions of constitutions, statutes, laws, rules,
regulations and orders of all governmental bodies and all orders and decrees of all courts,
tribunals and arbitrators.



     “Applicable Margin” means the percentage rate set forth below corresponding to the ratio of
Total Indebtedness to Total Asset Value as determined in accordance with Section 10.1. in effect at
such time:



	 	 	 	 	 	 	 	 	 	 	 
	 	 	Total Indebtedness to	 	Applicable Margin	 	Applicable Margin
	Level	 	Total Asset Value	 	for LIBOR Loans	 	for Base Rate Loans
	1

	 	< 0.50 to 1.00
	 	 	1.00	%	 	 	0.0	%
	2

	 	> 0.50 to 1.00 and < 0.60 to 1.00
	 	 	1.20	%	 	 	0.0	%
	3

	 	> 0.60 to 1.00 and < 0.70 to 1.00
	 	 	1.40	%	 	 	0.0	%
	4

	 	> 0.70 to 1.00
	 	 	1.65	%	 	 	0.0	%





The Applicable Margin shall be determined by the Agent from time to time, based on the ratio
of Total Indebtedness to Total Asset Value as set forth in the Compliance Certificate most recently
delivered by the Borrower pursuant to Section 9.3. Any adjustment to the Applicable Margin shall
be effective (a) in the case of a Compliance Certificate delivered in connection with quarterly
financial statements of the Borrower delivered pursuant to Section 9.1., as of the date 55 days
following the end of the last day of the applicable fiscal quarter covered by such Compliance
Certificate, (b) in the case of a Compliance Certificate delivered in connection with annual
financial statements of the Borrower delivered pursuant to Section 9.2., as of the date 100 days
following the end of the last day of the applicable fiscal year covered by such Compliance
Certificate, and (c) in the case of any other Compliance Certificate, as of the date 5 Business
Days following the Agent’s request for such Compliance Certificate. If the Borrower fails to
deliver a Compliance Certificate pursuant to Section 9.3., the Applicable Margin shall equal the
percentages corresponding to Level 4 until the date of the delivery of the required Compliance
Certificate. As of the Agreement Date, and thereafter until changed as provided above, the
Applicable Margin is determined based on Level 2.




     “Appraisal” means, in respect of any Property, an M.A.I. appraisal commissioned by and
addressed to the Agent (acceptable to the Agent as to form, substance and appraisal date), prepared
by a professional appraiser acceptable to the Agent, having at least the minimum



-2-









 




qualifications required under Applicable Law governing the Agent and the Lenders, including FIRREA,
and determining the “as is” market value of such Property as between a willing buyer and a willing
seller.




     “Appraised Value” means, with respect to any Property, the “as is” market value of such
Property as reflected in the then most recent Appraisal of such Property as the same may have been
reasonably adjusted by the Agent based upon its internal review of such Appraisal which is based on
criteria and factors then generally used and considered by the Agent in determining the value of
similar properties, which review shall be conducted prior to acceptance of such Appraisal by the
Agent. Any such adjustment by the Agent shall be based upon demonstrated market data applicable to
such Property and be consistent with M.A.I. standards and shall not be inconsistent with the then
prevailing mortgage lending practices for comparable properties and credit facilities.



     “Arranger” means Wachovia Capital Markets, LLC, together with its successors and permitted
assigns.



     “Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an
affiliate of a Lender or (c) an entity or an affiliate of an entity that administers or manages a
Lender.



     “Assignee” has the meaning given that term in Section 13.5.(d).



     “Assignment and Acceptance Agreement” means an Assignment and Acceptance Agreement among a
Lender, an Assignee and the Agent, substantially in the form of Exhibit A.



     “Assignment of Leases and Rents” means an Assignment of Leases and Rents executed by a Loan
Party in favor of the Agent for the benefit of the Lenders, substantially in the form of Exhibit L
or otherwise in form and substance satisfactory to the Agent.



     “Base Rate” means the per annum rate of interest equal to the greater of (a) the Prime Rate or
(b) the Federal Funds Rate plus one-half of one percent (0.5%). Any change in the Base Rate
resulting from a change in the Prime Rate or the Federal Funds Rate shall become effective as of
12:01 a.m. on the Business Day on which each such change occurs. The Base Rate is a reference rate
used by the Lender acting as the Agent in determining interest rates on certain loans and is not
intended to be the lowest rate of interest charged by the Lender acting as the Agent or any other
Lender on any extension of credit to any debtor.



     “Base Rate Loan” means a Revolving Loan bearing interest at a rate based on the Base Rate.



     “Benefit Arrangement” means at any time an employee benefit plan within the meaning of Section
3(3) of ERISA which is not a Plan or a Multiemployer Plan and which is maintained or otherwise
contributed to by any member of the ERISA Group.



-3-









 





     “Borrower” has the meaning set forth in the introductory paragraph hereof and shall include
the Borrower’s successors and permitted assigns.



     “Borrowing Base” means an amount equal to the lesser of (a) 75.0% of the Appraised Values of
all Collateral Properties and (b) the sum of (i) the aggregate Implied Debt Service Values of all
Collateral Properties plus (ii) the net present value of all Tenant Improvement Rent for the fixed
term of the applicable leases computed using a discount rate equal to the yield on a 10 year United
States Treasury Note plus 0.5%. To the extent that amount of the Borrowing Base attributable to
Collateral Properties leased by Loan Parties under Ground Leases would exceed 20.0% of the
Borrowing Base, such excess shall be excluded. In the case of a NY Property encumbered by a
Security Deed containing a limitation on the principal amount of Obligations secured thereby as
contemplated by Section 4.8.(b), in no event shall the amount of the Borrowing Base attributable to
such NY Property exceed the amount of the limitation on the principal amount of Obligations secured
by such Security Deed (excluding the amount of such limitation attributable to an increase thereof
effected pursuant to the last paragraph of Section 4.8.(b)). Notwithstanding the foregoing, a
Collateral Property shall be excluded from calculations of the Borrowing Base if (x) at any time
such Property shall cease to be an Eligible Property (except with respect to any condition approved
of by the Requisite Lenders pursuant to Section 4.1.(c)(ii)), (y) the Agent shall cease to hold a
valid and perfected first priority Lien in such Collateral Property, or (z) there shall have
occurred and be continuing an event of default under the Security Deed, Assignment of Leases and
Rents or any other Security Document relating to such Collateral Property after giving effect to
any applicable notice or cure periods provided therein.



     “Borrowing Base Certificate” means a report certified by the chief financial officer of the
Borrower, setting forth the calculations required to establish the Borrowing Base as of a specified
date, all in form and detail satisfactory to the Agent.



     “Business Day” means (a) any day other than a Saturday, Sunday or other day on which banks in
Charlotte, North Carolina are authorized or required to close and (b) with reference to a LIBOR
Loan, any such day that is also a day on which dealings in Dollar deposits are carried out in the
London interbank market.



     “Capital Reserves” means, for any period and with respect to a Property, an amount equal to
(a) $0.25 per square foot of all completed space of such Property times (b) a fraction, the
numerator of which is the number of days in such period and the denominator of which is 365. Any
portion of a Property leased under a ground lease to a third party that owns the improvements on
such portion of such Property shall not be included in determinations of Capital Reserves. If the
term Capital Reserves is used without reference to any specific Property, then the amount shall be
determined on an aggregate basis with respect to all Properties of the Borrower and its
Subsidiaries and a proportionate share of all Properties of all Unconsolidated Affiliates.



     “Capitalized Lease Obligation” means an obligation under a lease that is required to be
capitalized for financial reporting purposes in accordance with GAAP. The amount of a Capitalized
Lease Obligation is the capitalized amount of such obligation as would be required to



-4-









 




be reflected on a balance sheet of the applicable Person prepared in accordance with GAAP as of the
applicable date.




     “Cash Available for Distribution” means, for any period of determination: (a) net income (or
loss) of the Borrower and its Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP, exclusive of the following (but only to the extent included in determination
of such net income (loss)): (i) depreciation and amortization, including amortization of
intangibles and of deferred financing costs and fees, (ii) gains on sale of real estate assets,
(iii) adjustments to remove any impact from straight line leveling adjustments required under GAAP,
(iv) noncash charges and noncash expenses attributable to restricted share compensation and (v)
extraordinary noncash items; minus, (b) all principal payments made with respect to
Indebtedness of the Borrower and its Subsidiaries; minus, (c) Capital Reserves.



     “Cash Equivalents” means: (a) securities issued, guaranteed or insured by the United States of
America or any of its agencies with maturities of not more than one year from the date acquired;
(b) readily marketable direct obligations of any State of the United States of America or any
political subdivision of any such State or any public agency or instrumentality thereof given on
the date of such investment a credit rating of at least Aa3 by Moody’s or AA- by S&P, in each case
due within one year from the making of the investment; (c) certificates of deposit with maturities
of not more than one year from the date acquired issued by a United States federal or state
chartered commercial bank of recognized standing, or a commercial bank organized under the laws of
any other country which is a member of the Organization for Economic Cooperation and Development,
or a political subdivision of any such country, acting through a branch or agency, which bank has
capital and unimpaired surplus in excess of $500,000,000 and which bank or its holding company has
a short-term commercial paper rating of at least A-2 or the equivalent by S&P or at least P-2 or
the equivalent by Moody’s; (d) reverse repurchase agreements with terms of not more than seven days
from the date acquired, for securities of the type described in clause (a) above and entered into
only with commercial banks having the qualifications described in clause (c) above; (e) commercial
paper issued by any Person incorporated under the laws of the United States of America or any State
thereof and rated at least A-2 or the equivalent thereof by S&P or at least P-2 or the equivalent
thereof by Moody’s, in each case with maturities of not more than one year from the date acquired;
and (f) investments in money market funds registered under the Investment Company Act of 1940, as
amended, which have net assets of at least $500,000,000 and at least 85% of whose assets consist of
securities and other obligations of the type described in clauses (a) through (e) above.



     “Collateral” means the Collateral Account, all “Collateral” under and as defined in any
Security Deed, all “Management Agreements” as defined in any Property Management Contract
Assignment, all “Leases” and “Rents” as defined in any Assignment of Leases and Rents, all
“Collateral” as defined in any Collateral Assignment of Interest Rate Protection Agreement, all
“Collateral” as defined in the Pledge Agreement, and all other property subject to a Lien created
by a Security Document.



     “Collateral Account” means a special non-interest bearing deposit account or securities
account maintained by, or on behalf of, the Agent and under its sole dominion and control.



-5-









 





     “Collateral Assignment of Interest Rate Protection Agreement” means a Collateral Assignment of
Interest Rate Protection Agreement executed by a Loan Party in favor of the Agent for the benefit
of the Lenders, substantially in the form of Exhibit P.



     “Collateral Property” means a Property which the Agent or the Requisite Lenders have, pursuant
to Section 4.1.(c)(i) or (ii), as applicable, agreed to include in calculations of the Borrowing
Base and in respect of which the conditions contained in Section 4.2. have been satisfied.



     “Collateral Property Value” means, with respect to a Collateral Property, an amount equal to
the Appraised Value of such Collateral Property.



     “Commitment” means, as to each Lender (other than the Swingline Lender), such Lender’s
obligation (a) to make Revolving Loans pursuant to Section 2.1., (b) to issue (in the case of the
Lender then acting as Agent) or participate in (in the case of the other Lenders) Letters of Credit
pursuant to Section 2.3.(a) and 2.3.(i), respectively (but in the case of the Lender acting as the
Agent excluding the aggregate amount of participations in the Letters of Credit held by the other
Lenders), and (c) to participate in Swingline Loans pursuant to Section 2.2.(e), in each case, in
an amount up to, but not exceeding, the amount set forth for such Lender on its signature page
hereto as such Lender’s “Commitment Amount” or as set forth in the applicable Assignment and
Acceptance Agreement, as the same may be reduced from time to time pursuant to Section 2.11.,
increased pursuant to Section 2.15. or increased or reduced as appropriate to reflect any
assignments to or by such Lender effected in accordance with Section 13.5.



     “Commitment Percentage” means, as to each Lender, the ratio, expressed as a percentage, of (a)
the amount of such Lender’s Commitment to (b) the aggregate amount of the Commitments of all
Lenders; provided, however, that if at the time of determination the Commitments have terminated or
been reduced to zero, the “Commitment Percentage” of each Lender shall be the Commitment Percentage
of such Lender in effect immediately prior to such termination or reduction.



     “Compliance Certificate” has the meaning given that term in Section 9.3.



     “Construction-in-Process” means cash expenditures for land and improvements (including
indirect costs internally allocated and development costs) determined in accordance with GAAP on
all Properties that are under development or are scheduled to commence development within twelve
months from any date of determination.



     “Continue”, “Continuation” and “Continued” each refers to the continuation of a LIBOR Loan
from one Interest Period to another Interest Period pursuant to Section 2.8.



     “Convert”, “Conversion” and “Converted” each refers to the conversion of a Revolving Loan of
one Type into a Revolving Loan of another Type pursuant to Section 2.9.



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     “Credit Event” means any of the following: (a) the making (or deemed making) of any Loan, (b)
the Continuation of a LIBOR Loan, (c) the Conversion of a Base Rate Loan into a LIBOR Loan, and (d)
the issuance of a Letter of Credit.



     “Default” means any of the events specified in Section 11.1., whether or not there has been
satisfied any requirement for the giving of notice, the lapse of time, or both.



     “Defaulting Lender” has the meaning given that term in Section 3.11.



     “Derivatives Contract” means any and all rate swap transactions, basis swaps, credit
derivative transactions, forward rate transactions, commodity swaps, commodity options, forward
commodity contracts, equity or equity index swaps or options, bond or bond price or bond index
swaps or options or forward bond or forward bond price or forward bond index transactions, interest
rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap transactions, currency options,
spot contracts, or any other similar transactions or any combination of any of the foregoing
(including any options to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement. Not in limitation of the foregoing, the term
“Derivatives Contract” includes any and all transactions of any kind, and the related
confirmations, which are subject to the terms and conditions of, or governed by, any form of master
agreement published by the International Swaps and Derivatives Association, Inc., any International
Foreign Exchange Master Agreement, or any other master agreement, including any such obligations or
liabilities under any such master agreement.



     “Derivatives Termination Value” means, in respect of any one or more Derivatives Contracts,
after taking into account the effect of any legally enforceable netting agreement relating to such
Derivatives Contracts, (a) for any date on or after the date such Derivatives Contracts have been
closed out and termination value(s) determined in accordance therewith, such termination value(s),
and (b) for any date prior to the date referenced in clause (a) the amount(s) determined as the
mark-to-market value(s) for such Derivatives Contracts, as determined based upon one or more
mid-market or other readily available quotations provided by any recognized dealer in such
Derivatives Contracts (which may include the Agent or any Lender).



     “Dollars” or “$” means the lawful currency of the United States of America.



     “EBITDA” means, with respect to a Person for any period (without duplication): (a) net income
(loss) of such Person for such period determined on a consolidated basis (exclusive of the impact
of minority interests), exclusive of the following (but only to the extent included in
determination of such net income (loss)): (i) depreciation and amortization (include amortization
of non-cash expenses, including non-cash financing costs and non-cash compensation); (ii) Interest
Expense; (iii) income tax expense; and (iv) extraordinary or non-recurring gains and losses;
plus (b) (i) such Person’s pro rata share of EBITDA of its Unconsolidated Affiliates and
(ii) prepaid rent paid with respect to the Property located at 1201 Lloyd Boulevard, Portland
Oregon, as and when released from reserves of restricted cash. EBITDA shall be adjusted to



-7-









 




remove any impact from straight line rent leveling adjustments required under GAAP (except with
respect to Niagara Center) and from amortization of intangibles pursuant to Statement of Financial
Accounting Standards number 141.




     “Eligible Assignee” means (a) a Lender, (b) an affiliate of a Lender, (c) an Approved Fund,
and (d) any other Person (other than a natural person) approved by (i) the Agent and (ii) unless a
Default or Event of Default exists, the Borrower (each such approval not to be unreasonably
withheld or delayed); provided that notwithstanding the foregoing, “Eligible Assignee” shall not
include the Borrower or any of the Borrower’s Affiliates or Subsidiaries.



     “Eligible Property” means a Property which satisfies all of the following requirements: (a)
such Property is located in a state, commonwealth or territory of the United States of America, or
in the District of Columbia and is fully developed as an office property, or in the case of a
Property leased to the General Services Administration of the United States (the “GSA”), for any
use permitted by the applicable lease with the GSA; (b) the Property is owned, or leased under a
Ground Lease, entirely by the Borrower or a Subsidiary; (c) neither such Property, nor any interest
of the Borrower or any Subsidiary therein, is subject to any Lien (other than Permitted Liens (but
not Liens of the type described in clause (g) of the definition of Permitted Liens)), or a Negative
Pledge; (d) if such Property is owned or leased by a Subsidiary (i) none of the Borrower’s direct
or indirect ownership interest in such Subsidiary is subject to any Lien (other than Permitted
Liens (but not Liens of the type described in clause (g) of the definition of Permitted Liens)), or
to a Negative Pledge; and (ii) the Borrower directly, or indirectly through a Subsidiary, has the
right to take the following actions without the need to obtain the consent of any Person: (x) to
sell, transfer or otherwise dispose of such Property and (y) to create a Lien on such Property as
security for Indebtedness of the Borrower or such Subsidiary, as applicable; (e) the Borrower, or
such Subsidiary if such Property is owned or leased by such Subsidiary, has all material permits
and licenses relating to the use, ownership, occupancy and operation of such Property; (f) such
Property is free of all structural defects or major architectural deficiencies, title defects,
environmental conditions or other adverse matters except for defects, deficiencies, conditions or
other matters individually or collectively which are not material to the profitable operation of or
the marketability of such Property; (g) at least 80% of the revenue of such Property is derived
from tenants that are federal, state or municipal governments or sponsored by federal, state, or
municipal governments, including quasi-governmental entities, in each case having a general
obligation rating from S&P or Moody’s of at least A or A2; and (h) the weighted average remaining
lease period (based upon revenues) for such Property is at least three years.



     “Environmental Indemnity Agreement” means an Environmental Indemnity Agreement executed by a
Loan Party in favor of the Agent and the Lenders and substantially in the form of Exhibit M.



     “Environmental Laws” means any Applicable Law relating to environmental protection or the
manufacture, storage, remediation, disposal or clean-up of Hazardous Materials including, without
limitation, the following: Clean Air Act, 42 U.S.C. § 7401 et seq.; Federal Water Pollution Control
Act, 33 U.S.C. § 1251 et seq.; Solid Waste Disposal Act, as amended by the Resource Conservation
and Recovery Act, 42 U.S.C. § 6901 et seq.; Comprehensive



-8-









 




Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq.; National
Environmental Policy Act, 42 U.S.C. § 4321 et seq.; regulations of the Environmental Protection
Agency and any applicable rule of common law and any judicial interpretation thereof relating
primarily to the environment or Hazardous Materials.




     “Equity Interest” means, with respect to any Person, any share of capital stock of (or other
ownership or profit interests in) such Person, any warrant, option or other right for the purchase
or other acquisition from such Person of any share of capital stock of (or other ownership or
profit interests in) such Person, any security convertible into or exchangeable for any share of
capital stock of (or other ownership or profit interests in) such Person or warrant, right or
option for the purchase or other acquisition from such Person of such shares (or such other
interests), and any other ownership or profit interest in such Person (including, without
limitation, partnership, member or trust interests therein), whether voting or nonvoting, and
whether or not such share, warrant, option, right or other interest is authorized or otherwise
existing on any date of determination.



     “Equity Issuance” means any issuance by a Person of any Equity Interest in such Person and
shall in any event include the issuance of any Equity Interest upon the conversion or exchange of
any security constituting Indebtedness that is convertible or exchangeable, or is being converted
or exchanged, for Equity Interests.



     “ERISA” means the Employee Retirement Income Security Act of 1974, as in effect from time to
time.



     “ERISA Group” means the Borrower, any Subsidiary and all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under common control which,
together with the Borrower or any Subsidiary, are treated as a single employer under Section 414 of
the Internal Revenue Code.



     “Event of Default” means any of the events specified in Section 11.1., provided that any
requirement for notice or lapse of time or any other condition has been satisfied.



     “Exchange Street” means the Property located at 186 Exchange Street, Buffalo, New York and
owned by Buffalo NY SSA, LLC, a New York limited liability company and Subsidiary of the Borrower.



     “Excluded Subsidiary” means any Subsidiary (a) holding title to or beneficially owning assets
which are or are intended to become collateral for any Secured Indebtedness of such Subsidiary, or
being a beneficial owner of a Subsidiary holding title to or beneficially owning such assets (but
having no material assets other than such beneficial ownership interests) and (b) which (i) is, or
is expected to be, prohibited from Guarantying the Indebtedness of any other Person pursuant to any
document, instrument or agreement evidencing such Secured Indebtedness or (ii) is prohibited from
Guarantying the Indebtedness of any other Person pursuant to a provision of such Subsidiary’s
organizational documents which provision was included in such Subsidiary’s organizational documents
as a condition or anticipated condition to the extension of such Secured Indebtedness.



-9-









 





     “Existing Credit Agreement” means that certain Revolving Credit Agreement dated as of April
28, 2004 by and among the Borrower, First National Bank of Omaha, and the other parties thereto.



     “Fair Market Value” means, with respect to (a) a security listed on a national securities
exchange or the NASDAQ National Market, the price of such security as reported on such exchange or
market by any widely recognized reporting method customarily relied upon by financial institutions
and (b) with respect to any other property, the price which could be negotiated in an arm’s-length
free market transaction, for cash, between a willing seller and a willing buyer, neither of which
is under pressure or compulsion to complete the transaction.



     “Federal Funds Rate” means, for any day, the rate per annum (rounded upward to the nearest
1/100th of 1%) equal to the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next succeeding such day,
provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day, and (b) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the
average rate quoted to the Agent by federal funds dealers selected by the Agent on such day on such
transaction as determined by the Agent.



     “Fees” means the fees and commissions provided for or referred to in Section 3.6. and any
other fees payable by the Borrower hereunder or under any other Loan Document.



     “FIRREA” means the Financial Institution Recovery, Reform and Enforcement Act of 1989, as
amended.



     “Fixed Charges” means, for any period, the sum of (a) Interest Expense of the Borrower and its
Subsidiaries determined on a consolidated basis for such period, (b) all regularly scheduled
principal payments made with respect to Indebtedness of the Borrower and its Subsidiaries during
such period, other than any balloon, bullet, defeasance, refinancing or similar principal payment
which repays such Indebtedness in full, and (c) all Preferred Dividends paid during such period.
The Borrower’s pro rata share of the Fixed Charges of Unconsolidated Affiliates of the Borrower
shall be included in determinations of Fixed Charges.



     “Floating Rate Indebtedness” means all Indebtedness of a Person which bears interest at a
variable rate during the scheduled life of such Indebtedness and for which such Person has not
obtained interest rate swap agreements, interest rate “cap” or “collar” agreements or other similar
Derivatives Contracts which effectively cause such variable rates to be equivalent to fixed rates
less than or equal to (a) the rate (as reasonably determined by the Agent) borne by United States
10-year Treasury Notes at the time the applicable Derivatives Contract became effective plus (b)
1.50%.



     “Foreign Lender” means any Lender that is organized under the laws of a jurisdiction other
than the United States of America, any State thereof or the District of Columbia.



-10-









 





     “Fund” means any Person (other than a natural person) that is (or will be) engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in
the ordinary course of its business.



     “Funds From Operations” means Funds From Operations calculated in a manner consistent with the
White Paper on Funds From Operations dated October 1999 issued by National Association of Real
Estate Investments Trusts, Inc. (“NAREIT”), as amended, supplemented or otherwise modified by
NAREIT from time to time.



     “GAAP” means generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as may be approved by a significant segment of the
accounting profession, which are applicable to the circumstances as of the date of determination.



     “Governmental Approvals” means all authorizations, consents, approvals, licenses and
exemptions of, registrations and filings with, and reports to, all Governmental Authorities.



     “Governmental Authority” means any national, state or local government (whether domestic or
foreign), any political subdivision thereof or any other governmental, quasi-governmental,
judicial, public or statutory instrumentality, authority, body, agency, bureau, commission, board,
department or other entity (including, without limitation, the Federal Deposit Insurance
Corporation, the Comptroller of the Currency or the Federal Reserve Board, any central bank or any
comparable authority) or any arbitrator with authority to bind a party at law.



     “Ground Lease” means a ground lease containing terms and conditions acceptable to the Agent.



     “Guarantor” means any Person that is a party to the Guaranty as a “Guarantor” and in any event
shall include each Material Subsidiary (unless an Excluded Subsidiary).



     “Guaranty”, “Guaranteed”, “Guarantying” or to “Guarantee” as applied to any obligation means
and includes: (a) a guaranty (other than by endorsement of negotiable instruments for collection
or deposit in the ordinary course of business), directly or indirectly, in any manner, of any part
or all of such obligation, or (b) an agreement, direct or indirect, contingent or otherwise, and
whether or not constituting a guaranty, the practical effect of which is to assure the payment or
performance (or payment of damages in the event of nonperformance) of any part or all of such
obligation whether by: (i) the purchase of securities or obligations, (ii) the purchase, sale or
lease (as lessee or lessor) of property or the purchase or sale of services primarily for the
purpose of enabling the obligor with respect to such obligation to make any payment or performance
(or payment of damages in the event of nonperformance) of or on account of any part or all of such
obligation, or to assure the owner of such obligation against loss, (iii) the supplying of funds to
or in any other manner investing in the obligor with respect to such obligation, (iv) repayment of
amounts drawn down by beneficiaries of letters of



-11-









 




credit (including Letters of Credit), or (v) the supplying of funds to or investing in a Person on
account of all or any part of such Person’s obligation under a Guaranty of any obligation or
indemnifying or holding harmless, in any way, such Person against any part or all of such
obligation. As the context requires, “Guaranty” shall also mean the Guaranty to which the
Guarantors are parties substantially in the form of Exhibit J.




     “Hazardous Materials” means all or any of the following: (a) substances that are defined or
listed in, or otherwise classified pursuant to, any applicable Environmental Laws as “hazardous
substances”, “hazardous materials”, “hazardous wastes”, “toxic substances” or any other formulation
intended to define, list or classify substances by reason of deleterious properties such as
ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, “TCLP” toxicity or
“EP toxicity”; (b) oil, petroleum or petroleum derived substances, natural gas, natural gas liquids
or synthetic gas and drilling fluids, produced waters and other wastes associated with the
exploration, development or production of crude oil, natural gas or geothermal resources; (c) any
flammable substances or explosives or any radioactive materials; (d) asbestos in any form; (e)
toxic mold; and (f) electrical equipment which contains any oil or dielectric fluid containing
levels of polychlorinated biphenyls in excess of fifty parts per million.



     “Implied Debt Service Value” means, as of any date of determination and with respect to any
Collateral Property, an amount equal to (a)(i) the Net Operating Income of such Collateral Property
for the two most recently ended fiscal quarters of the Borrower times (ii) 2, divided
by (b) 1.20, divided by (c) the mortgage constant for a 25-year loan bearing interest
at a per annum rate equal to the greater of (i) the yield on a 10 year United States Treasury Note
plus 1.50% and (ii) 6.50%. If a Loan Party has not owned a Collateral Property for at least two
fiscal quarters, then the Implied Debt Service Value of such Collateral Property shall be
calculated using the historical Net Operating Income of such Collateral Property. If a Collateral
Property has not initially operated for at least two fiscal quarters, then the Implied Debt Service
Value of such Collateral Property shall be equal to the Appraised Value of such Collateral
Property. When determining the Implied Debt Service Value for Niagara Center for the period from
the date the New York State Court of Claims begins paying rent under its lease of a portion of
Niagara Center until the New York State Court of Claims has paid rent under such lease for two
complete fiscal quarters of the Borrower, Net Operating Income of Niagara Center attributable to
such lease shall be calculated by the Borrower on a pro forma basis acceptable to the Agent. For
purposes of this definition, if the Borrower or another Loan Party has entered into a Derivatives
Contract to hedge interest rate risk associated with Indebtedness incurred by the Borrower or such
other Loan Party to finance the acquisition or ownership of a Collateral Property and the Agent has
a perfected Lien in such Derivatives Contract pursuant to a Collateral Assignment of Interest Rate
Protection Agreement, then the Implied Debt Service Value for such Collateral Property shall, to
the extent of the notional amount of such Derivatives Contract, be determined using a mortgage
constant determined based on (x) the effective interest rate on such Indebtedness after giving
effect to such Derivatives Contract plus (y) 1.50%. For the avoidance of doubt, the
parties agree that with respect to the Properties described on Schedule 4.1., the Implied Debt
Service Value shall be calculated using the effective interest rate taking into account the
Borrower’s $50,000,000 forward starting swap as in effect on the Agreement Date so long as the
Agent has a perfected Lien in such forward starting swap pursuant to a Collateral Assignment of
Interest Rate Protection Agreement.



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     “Indebtedness” means, with respect to a Person, at the time of computation thereof, all of the
following (without duplication): (a) all obligations of such Person in respect of money borrowed
(other than trade debt incurred in the ordinary course of business which is not more than 60 days
past due); (b) all obligations of such Person, whether or not for money borrowed (i) represented by
notes payable, or drafts accepted, in each case representing extensions of credit, (ii) evidenced
by bonds, debentures, notes or similar instruments, or (iii) constituting purchase money
indebtedness, conditional sales contracts, title retention debt instruments or other similar
instruments, upon which interest charges are customarily paid or that are issued or assumed as full
or partial payment for property or services rendered; (c) Capitalized Lease Obligations of such
Person; (d) all reimbursement obligations (contingent or otherwise) of such Person in respect of
letters of credit or acceptances (whether or not the same have been presented for payment); (e) all
Off-Balance Sheet Obligations of such Person; (f) all obligations of such Person to purchase,
redeem, retire, defease or otherwise make any payment in respect of any Mandatorily Redeemable
Stock issued by such Person or any other Person, valued at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends; (g) all obligations of such
Person in respect of any purchase obligation, repurchase obligation, takeout commitment or forward
equity commitment, in each case evidenced by a binding agreement (excluding any such obligation to
the extent the obligation can be satisfied by the issuance of Equity Interests (other than
Mandatorily Redeemable Stock)); (h) net obligations under any Derivatives Contract not entered into
as an effective hedge against existing Indebtedness or Indebtedness to be incurred, in an amount
equal to the Derivatives Termination Value thereof; (i) all Indebtedness of other Persons which
such Person has Guaranteed or is otherwise recourse to such Person (except for guaranties of
customary exceptions for fraud, misapplication of funds, environmental indemnities and other
similar exceptions to recourse liability (but not exceptions relating to bankruptcy, insolvency,
receivership or other similar events)); (j) all Indebtedness of another Person secured by (or for
which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien on property or assets owned by such Person, even though such Person has not assumed or
become liable for the payment of such Indebtedness or other payment obligation; and (k) such
Person’s pro rata share of the Indebtedness of any Unconsolidated Affiliate of such Person. All
Loans and Letter of Credit Liabilities shall constitute Indebtedness of the Borrower.



     “Intellectual Property” has the meaning given that term in Section 7.1.(t).



     “Interest Expense” means, for any period, without duplication, (a) total interest expense of
the Borrower and its Subsidiaries, including capitalized interest (but excluding capitalized
interest funded under a construction loan interest reserve account), determined on a consolidated
basis for such period, plus (b) the Borrower’s pro rata share of Interest Expense of Unconsolidated
Affiliates for such period.



     “Interest Period” means, with respect to any LIBOR Loan, each period commencing on the date
such LIBOR Loan is made or the last day of the next preceding Interest Period for such Loan and
ending 7 days or 1, 2, 3 or 6 months or such longer periods as the Borrower may request and which
are available from all of the Lenders, thereafter, as the Borrower may select in a Notice of
Borrowing, Notice of Continuation or Notice of Conversion, as the case may be,



-13-









 




except that each Interest Period that commences on the last Business Day of a calendar month, or on
a day for which there is no corresponding day in the appropriate subsequent calendar month, shall
end on the last Business Day of the appropriate subsequent calendar month. Notwithstanding the
foregoing: (a) if any Interest Period would otherwise end after the Termination Date, such Interest
Period shall end on the Termination Date; and (b) each Interest Period that would otherwise end on
a day which is not a Business Day shall end on the immediately following Business Day (or in the
case of an Interest Period longer than 7 days, if such immediately following Business Day falls in
the next calendar month, on the immediately preceding Business Day).




     “Internal Revenue Code” means the Internal Revenue Code of 1986, as amended.



     “Investment” means, with respect to any Person, any acquisition or investment (whether or not
of a controlling interest) by such Person, by means of any of the following: (a) the purchase or
other acquisition of any Equity Interest in another Person, (b) a loan, advance or extension of
credit to, capital contribution to, Guaranty of Indebtedness of, or purchase or other acquisition
of any Indebtedness of, another Person, including any partnership or joint venture interest in such
other Person, or (c) the purchase or other acquisition (in one transaction or a series of
transactions) of assets of another Person that constitute the business or a division or operating
unit of another Person. Any binding commitment to make an Investment in any other Person, as well
as any option of another Person to require an Investment in such Person, shall constitute an
Investment. Except as expressly provided otherwise, for purposes of determining compliance with
any covenant contained in a Loan Document, the amount of any Investment shall be the amount
actually invested, without adjustment for subsequent increases or decreases in the value of such
Investment.



     “L/C Commitment Amount” equals $20,000,000.



     “Lender” means each financial institution from time to time party hereto as a “Lender”,
together with its respective successors and permitted assigns, and as the context requires,
includes the Swingline Lender.



     “Lending Office” means, for each Lender and for each Type of Loan, the office of such Lender
specified as such on its signature page hereto or in the applicable Assignment and Acceptance
Agreement, or such other office of such Lender of which such Lender may notify the Agent in writing
from time to time.



     “Letter of Credit” has the meaning given that term in Section 2.3.(a).



     “Letter of Credit Documents” means, with respect to any Letter of Credit, collectively, any
application therefor, any certificate or other document presented in connection with a drawing
under such Letter of Credit and any other agreement, instrument or other document governing or
providing for (a) the rights and obligations of the parties concerned or at risk with respect to
such Letter of Credit or (b) any collateral security for any of such obligations.



-14-









 





     “Letter of Credit Liabilities” means, without duplication, at any time and in respect of any
Letter of Credit, the sum of (a) the Stated Amount of such Letter of Credit plus (b) the aggregate
unpaid principal amount of all Reimbursement Obligations of the Borrower at such time due and
payable in respect of all drawings made under such Letter of Credit. For purposes of this
Agreement, a Lender (other than the Lender acting as the Agent) shall be deemed to hold a Letter of
Credit Liability in an amount equal to its participation interest in the related Letter of Credit
under Section 2.3.(i), and the Lender acting as the Agent shall be deemed to hold a Letter of
Credit Liability in an amount equal to its retained interest in the related Letter of Credit after
giving effect to the acquisition by the Lenders other than the Lender acting as the Agent of their
participation interests under such Section.



     “Level” has the meaning given that term in the definition of the term “Applicable Margin.”



     “LIBOR” means, for any LIBOR Loan for any Interest Period therefor, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any
successor thereto) as the London interbank offered rate for deposits in Dollars at approximately
11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period for a
term comparable to such Interest Period. If for any reason such rate is not available, the term
“LIBOR” shall mean, for any LIBOR Loan for any Interest Period therefor, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on the Reuters Screen LIBO
Page as the London interbank offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period; provided, however, if more than one rate is specified on the
Reuters Screen LIBO Page, the applicable rate shall be the arithmetic mean of all such rates. If
for any reason none of the foregoing rates is available, LIBOR shall be, for any Interest Period,
the rate per annum reasonably determined by the Agent as the rate of interest at which Dollar
deposits in the approximate amount of the LIBOR Loan comprising part of such borrowing would be
offered by the Agent to major banks in the London interbank Eurodollar market at their request at
or about 11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period.



     “LIBOR Loan” means a Revolving Loan bearing interest at a rate based on LIBOR.



     “Lien” as applied to the property of any Person means: (a) any security interest,
encumbrance, mortgage, deed to secure debt, deed of trust, assignment of leases and rents, pledge,
lien, charge or lease constituting a Capitalized Lease Obligation, conditional sale or other title
retention agreement, or other security title or encumbrance of any kind in respect of any property
of such Person, or upon the income, rents or profits therefrom; (b) any arrangement, express or
implied, under which any property of such Person is transferred, sequestered or otherwise
identified for the purpose of subjecting the same to the payment of Indebtedness or performance of
any other obligation in priority to the payment of the general, unsecured creditors of such Person;
(c) the filing of any financing statement under the Uniform Commercial Code or its equivalent in
any jurisdiction, other than any precautionary filing not otherwise constituting or giving rise to
a Lien, including a financing statement filed (i) in respect of a lease not constituting a
Capitalized Lease Obligation pursuant to Section 9-505 (or a successor provision)



-15-









 




of the Uniform Commercial Code or its equivalent as in effect in an applicable jurisdiction or (ii)
in connection with a sale or other disposition of accounts or other assets not prohibited by this
Agreement in a transaction not otherwise constituting or giving rise to a Lien; and (d) any
agreement by such Person to grant, give or otherwise convey any of the foregoing.




     “Loan” means a Revolving Loan or a Swingline Loan.



     “Loan Document” means this Agreement, each Note, each Letter of Credit Document, the Guaranty,
each Security Document and each other document or instrument now or hereafter executed and
delivered by a Loan Party in connection with, pursuant to or relating to this Agreement.



     “Loan Party” means each of the Borrower and each other Person who guarantees all or a portion
of the Obligations and/or who pledges any collateral security to secure all or a portion of the
Obligations. Schedule 1.1.(A) sets forth the Loan Parties in addition to the Borrower as of the
Agreement Date.



     “Mandatorily Redeemable Stock” means, with respect to any Person, any Equity Interest of such
Person which by the terms of such Equity Interest (or by the terms of any security into which it is
convertible or for which it is exchangeable or exercisable), upon the happening of any event or
otherwise, (a) matures or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise (other than an Equity Interest to the extent redeemable in exchange for common stock or
other equivalent common Equity Interests at the option of the issue of such Equity Interest), (b)
is convertible into or exchangeable or exercisable for Indebtedness or Mandatorily Redeemable
Stock, or (c) is redeemable at the option of the holder thereof, in whole or in part (other than an
Equity Interest which is redeemable solely in exchange for common stock or other equivalent common
Equity Interests), in each case on or prior to the date on which all Revolving Loans are scheduled
to be due and payable in full.



     “Material Adverse Effect” means a materially adverse effect on (a) the business, assets,
liabilities, condition (financial or otherwise) or results of operations of the Borrower and its
Subsidiaries taken as a whole, (b) the ability of the Borrower or any other Loan Party to perform
its obligations under any Loan Document to which it is a party, (c) the validity or enforceability
of any of the Loan Documents, (d) the rights and remedies of the Lenders and the Agent under any of
the Loan Documents or (e) the timely payment of the principal of or interest on the Loans or other
amounts payable in connection therewith or the timely payment of all Reimbursement Obligations.



     “Material Contract” means any contract or other arrangement, whether written or oral, to which
the Borrower, any Subsidiary or any other Loan Party is a party as to which the breach,
nonperformance, cancellation or failure to renew by any party thereto could reasonably be expected
to have a Material Adverse Effect. Notwithstanding the foregoing, none of the following shall
constitute a Material Contract: (a) any service or maintenance contract that is cancelable by the
Borrower, any Subsidiary or any other Loan Party a party thereto upon not more than 30 days prior
notice, (b) any of the Loan Documents or (c) any agreement relating to a Property that would
terminate upon (i) foreclosure of a Mortgage encumbering such Property or



-16-









 




(ii) transfer of such Property pursuant to a deed in lieu of foreclosure of a Mortgage encumbering
such Property.




     “Material Subsidiary” means any Subsidiary to which more than 5.0% of Total Asset Value is
attributable on an individual basis.



     “Moody’s” means Moody’s Investors Service, Inc., and its successors.



     “Mortgage” means a mortgage, deed of trust, deed to secure debt or similar security instrument
made by a Person owning an interest in real property granting a Lien on such interest in real
property as security for the payment of Indebtedness of such Person or another Person.



     “Mortgage Receivable” means a promissory note secured by a Mortgage of which the Borrower or
any of its Subsidiaries is the holder and retains the rights of collection of all payments
thereunder.



     “Multiemployer Plan” means at any time a multiemployer plan within the meaning of Section
4001(a)(3) of ERISA to which any member of the ERISA Group is then making or accruing an obligation
to make contributions or has within the preceding five plan years made contributions, including for
these purposes any Person which ceased to be a member of the ERISA Group during such five year
period.



     “Negative Pledge” means, with respect to a given asset, any provision of a document,
instrument or agreement (other than any Loan Document) which prohibits or purports to prohibit the
creation or assumption of any Lien on such asset as security for Indebtedness of the Person owning
such asset or any other Person; provided, however, that an agreement that conditions a Person’s
ability to encumber its assets upon the maintenance of one or more specified ratios that limit such
Person’s ability to encumber its assets but that do not generally prohibit the encumbrance of its
assets, or the encumbrance of specific assets, shall not constitute a Negative Pledge.



     “Net Operating Income” means, for any Property and for a given period, the sum of the
following (without duplication): (a) rents and other revenues received in the ordinary course from
such Property (excluding pre-paid rents and revenues and security deposits except to the extent
applied in satisfaction of tenants’ obligations for rent and excluding any Tenant Improvement Rent)
minus (b) all expenses paid or accrued related to the ownership, operation or maintenance of such
Property, including but not limited to taxes, assessments and the like, insurance, utilities,
payroll costs, maintenance, repair and landscaping expenses, marketing expenses, and general and
administrative expenses (including an appropriate allocation for legal, accounting, advertising,
marketing and other expenses incurred in connection with such Property, but specifically excluding
general overhead expenses of the Borrower or any Subsidiary and any property management fees) minus
(c) the Capital Reserves for such Property as of the end of such period minus (d) the greater of
(i) the actual property management fee paid during such period and (ii) an imputed management fee
in the amount of two percent (2.0%) of the gross revenues for such Property for such period. For
purposes of determining the Net Operating Income of Niagara Center, the amount of rent attributable
to Niagara Center shall



-17-









 




equal the amount of rent determined in accordance with GAAP including rent leveling adjustments
required in accordance with GAAP.




     “Net Proceeds” means with respect to any Equity Issuance by a Person, the aggregate amount of
all cash and the Fair Market Value of all other property (other than securities of such Person
being converted or exchanged in connection with such Equity Issuance) received by such Person in
respect of such Equity Issuance net of investment banking fees, legal fees, accountants’ fees,
underwriting discounts and commissions and other customary fees and expenses actually incurred by
such Person in connection with such Equity Issuance.



     “NY Owners” means (a) Acquest Government Leases, LLC, the owner of Niagara Center and (b)
Buffalo NY SSA, LLC, the owner of Exchange Street.



     “NY Properties” means Niagara Center and Exchange Street.



     “Niagara Center” means the Property located at 130 South Elmwood Ave., Buffalo, New York and
owned by Acquest Government Leases, LLC, a New York limited liability company and Subsidiary of the
Borrower.



     “Nonrecourse Indebtedness” means, with respect to a Person, Indebtedness for borrowed money in
respect of which recourse for payment (except for customary exceptions for fraud, misapplication of
funds, environmental indemnities, bankruptcy, insolvency, receivership or other similar events, and
other similar exceptions to nonrecourse liability) is contractually limited to specific assets of
such Person encumbered by a Lien securing such Indebtedness. Liability of a Person (a) in respect
of a Guaranty of any such exceptions or (b) completion or performance guarantees for Properties, to
the extent relating to the Nonrecourse Indebtedness of another Person, shall not, in and of itself,
prevent such liability from being characterized as Nonrecourse Indebtedness.



     “Note” means a Revolving Note or a Swingline Note.



     “Notice of Borrowing” means a notice in the form of Exhibit B to be delivered to the Agent
pursuant to Section 2.1.(b) evidencing the Borrower’s request for a borrowing of Revolving Loans.



     “Notice of Continuation” means a notice in the form of Exhibit C to be delivered to the Agent
pursuant to Section 2.8. evidencing the Borrower’s request for the Continuation of a LIBOR Loan.



     “Notice of Conversion” means a notice in the form of Exhibit D to be delivered to the Agent
pursuant to Section 2.9. evidencing the Borrower’s request for the Conversion of a Loan from one
Type to another Type.



     “Notice of Swingline Borrowing” means a notice in the form of Exhibit E to be delivered to the
Agent pursuant to Section 2.2. evidencing the Borrower’s request for a Swingline Loan.



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     “Obligations” means, individually and collectively: (a) the aggregate principal balance of,
and all accrued and unpaid interest on, all Loans; (b) all Reimbursement Obligations and all other
Letter of Credit Liabilities; and (c) all other indebtedness, liabilities, obligations, covenants
and duties of the Borrower and the other Loan Parties owing to the Agent or any Lender (or, in the
case of a Derivatives Contract, any affliliate of any Lender) of every kind, nature and
description, under or in respect of this Agreement or any of the other Loan Documents or any
Derivatives Contract entered into by the Borrower with any Lender (or any affiliate of any Lender),
including, without limitation, the Fees and indemnification obligations, whether direct or
indirect, absolute or contingent, due or not due, contractual or tortious, liquidated or
unliquidated, and whether or not evidenced by any promissory note.



     “OFAC” means U.S. Department of the Treasury’s Office of Foreign Assets Control and any
successor Governmental Authority.



     “Off-Balance Sheet Obligations” means liabilities and obligations of the Borrower, any
Subsidiary or any other Person in respect of “off-balance sheet arrangements” (as defined in the
SEC Off-Balance Sheet Rules) which the Borrower would be required to disclose in the “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” section of the Borrower’s
report on Form 10-Q or Form 10-K (or their equivalents) which the Borrower is required to file with
the Securities and Exchange Commission (or any Governmental Authority substituted therefor). As
used in this definition, the term “SEC Off-Balance Sheet Rules” means the Disclosure in
Management’s Discussion and Analysis About Off-Balance Sheet Arrangements, Securities Act Release
No. 33-8182, 68 Fed. Reg. 5982 (Feb. 5, 2003) (codified at 17 CFR pts. 228, 229 and 249).



     “Participant” has the meaning given that term in Section 13.5.(c).



     “PBGC” means the Pension Benefit Guaranty Corporation and any successor agency.



     “Permitted Liens” means, as to any Person: (a) Liens securing taxes, assessments and other
charges or levies imposed by any Governmental Authority (excluding any Lien imposed pursuant to any
of the provisions of ERISA or pursuant to any Environmental Laws) or the claims of materialmen,
mechanics, carriers, warehousemen or landlords for labor, materials, supplies or rentals incurred
in the ordinary course of business, which are not at the time required to be paid or discharged
under Section 8.6.; (b) Liens consisting of deposits or pledges made, in the ordinary course of
business, in connection with, or to secure payment of, obligations under workers’ compensation,
unemployment insurance or similar Applicable Laws; (c) Liens consisting of encumbrances in the
nature of zoning restrictions, easements, and rights or restrictions of record on the use of real
property, which do not materially impair the value of such property or impair the intended use
thereof in the business of such Person; (d) the rights of tenants under leases or subleases; (e)
Liens in favor of the Agent for the benefit of the Lenders; (f) Liens in favor of the Borrower or a
Guarantor securing obligations owing by a Subsidiary to the Borrower or such Guarantor which
obligations have been subordinated to the Obligations and all other obligations of the Loan Parties
under the Loan Documents on terms reasonably satisfactory to the Agent; (g) Liens in existence as
of the Agreement Date and described on



-19-









 




Schedule 7.1.(g); and (h) in the case of any Collateral encumbered by a Security Document, other
Liens expressly permitted by such Security Document.




     “Person” means an individual, corporation, partnership, limited liability company,
association, trust or unincorporated organization, or a government or any agency or political
subdivision thereof.



     “Plan” means at any time an employee pension benefit plan (other than a Multiemployer Plan)
which is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412
of the Internal Revenue Code and either (a) is maintained, or contributed to, by any member of the
ERISA Group for employees of any member of the ERISA Group or (b) has at any time within the
preceding five years been maintained, or contributed to, by any Person which was at such time a
member of the ERISA Group for employees of any Person which was at such time a member of the ERISA
Group.



     “Pledge Agreement” means the Pledge Agreement executed by the Borrower in favor of the Agent
for the benefit of the Lenders and substantially in the form of Exhibit Q.



     “Post-Default Rate” means a rate per annum equal to the Base Rate as in effect from time to
time plus the Applicable Margin for Base Rate Loans plus four percent (4.0%).



     “Preferred Dividends” means, for any period and without duplication, all Restricted Payments
paid during such period on Preferred Equity Interests issued by the Borrower or a Subsidiary.
Preferred Dividends shall not include dividends or distributions (a) paid or payable solely in
Equity Interests (other than Mandatorily Redeemable Stock) payable to holders of such class of
Equity Interests, (b) paid or payable to the Borrower or a Subsidiary, or (c) constituting or
resulting in the redemption of Preferred Equity Interests, other than scheduled redemptions not
constituting balloon, bullet or similar redemptions in full.



     “Preferred Equity Interests” means, with respect to any Person, Equity Interests in such
Person which are entitled to preference or priority over any other Equity Interest in such Person
in respect of the payment of dividends or distribution of assets upon liquidation or both.



     “Prime Rate” means the rate of interest per annum announced publicly by the Lender then acting
as the Agent as its prime rate from time to time. The Prime Rate is not necessarily the best or
the lowest rate of interest offered by the Lender acting as the Agent or any other Lender.



     “Principal Office” means the office of the Agent located at One Wachovia Center, Charlotte,
North Carolina, or such other office of the Agent as the Agent may designate from time to time.



     “Property” means any parcel of real property owned or leased (in whole or in part) or operated
by the Borrower, any Subsidiary or any Unconsolidated Affiliate of the Borrower and which is
located in a state, commonwealth or territory of the United States of America or the District of
Columbia.



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     “Property Management Agreement” means, collectively, all agreements entered into by a Loan
Party pursuant to which such Loan Party engages a Person to advise it with respect to the
management of a Collateral Property.



     “Property Management Contract Assignment” means a an Assignment of Management Agreement and
Subordination of Management Fees executed by a Loan Party in favor of the Agent for the benefit of
the Lenders substantially in the form of Exhibit O or otherwise in form and substance reasonably
satisfactory to the Agent. Such document may, at the Agent’s election, constitute a subordination
of Property Management Agreement, rather than an assignment thereof.



     “Register” has the meaning given that term in Section 13.5.(e).



     “Regulatory Change” means, with respect to any Lender, any change effective after the
Agreement Date in Applicable Law (including without limitation, Regulation D of the Board of
Governors of the Federal Reserve System) or the adoption or making after such date of any
interpretation, directive or request applying to a class of banks, including such Lender, of or
under any Applicable Law (whether or not having the force of law and whether or not failure to
comply therewith would be unlawful) by any Governmental Authority or monetary authority charged
with the interpretation or administration thereof or compliance by any Lender with any request or
directive regarding capital adequacy.



     “Reimbursement Obligation” means the absolute, unconditional and irrevocable obligation of the
Borrower to reimburse the Agent for any drawing honored by the Agent under a Letter of Credit.



     “REIT” means a Person qualifying for treatment as a “real estate investment trust” under the
Internal Revenue Code.



     “Requisite Lenders” means, as of any date, Lenders having at least 66-2/3% of the aggregate
amount of the Commitments (not held by Defaulting Lenders who are not entitled to vote), or, if the
Commitments have been terminated or reduced to zero, Lenders holding at least 66-2/3% of the
principal amount of the aggregate outstanding Loans and Letter of Credit Liabilities (not held by
Defaulting Lenders who are not entitled to vote). Commitments, Revolving Loans and Letter of
Credit Liabilities held by Defaulting Lenders shall be disregarded when determining the Requisite
Lenders. For purposes of this definition, a Lender (other than the Swingline Lender) shall be
deemed to hold a Swingline Loan or a Letter of Credit Liability to the extent such Lender has
acquired a participation therein under the terms of this Agreement and has not failed to perform
its obligations in respect of such participation.



     “Responsible Officer” means with respect to the Borrower or any Subsidiary, the chief
executive officer, the chief financial officer, treasurer and any senior vice president of the
Borrower or such Subsidiary.



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     “Restricted Payment” means: (a) any dividend or other distribution, direct or indirect, on
account of any Equity Interest of the Borrower or any Subsidiary now or hereafter outstanding,
except a dividend payable solely in Equity Interests of an identical or junior class to the holders
of that class; (b) any redemption, conversion, exchange, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of any Equity Interest of the
Borrower or any Subsidiary now or hereafter outstanding; and (c) any payment made to retire, or to
obtain the surrender of, any outstanding warrants, options or other rights to acquire any Equity
Interests of the Borrower or any Subsidiary now or hereafter outstanding.



     “Revolving Loan” means a loan made by a Lender to the Borrower pursuant to Section 2.1.(a).



     “Revolving Note” has the meaning given that term in Section 2.10.(a).



     “Sanctioned Entity” means (a) an agency of the government of, (b) an organization directly or
indirectly controlled by, or (c) a Person resident in, in each case, a country that is subject to a
sanctions program identified on the list maintained by the OFAC and published from time to time, as
such program may be applicable to such agency, organization or Person.



     “Sanctioned Person” means a Person named on the list of Specially Designated Nationals or
Blocked Persons maintained by the OFAC as published from time to time.



     “Secured Indebtedness” means, with respect to a Person as of any given date, the aggregate
principal amount of all Indebtedness of such Person outstanding at such date and that is secured in
any manner by any Lien, and in the case of the Borrower, shall include (without duplication) the
Borrower’s pro rata share of the Secured Indebtedness of its Unconsolidated Affiliates.



     “Secured Recourse Indebtedness” means Secured Indebtedness of the Borrower or any of its
Subsidiaries that is not Nonrecourse Indebtedness. For purposes of this definition, the
Obligations shall not constitute Secured Recourse Indebtedness.



     “Securities Act” means the Securities Act of 1933, as amended from time to time, together with
all rules and regulations issued thereunder.



     “Security Deed” means a deed to secure debt, deed of trust or other mortgage executed by a
Loan Party in favor of the Agent and substantially in the form of Exhibit K or otherwise in form
and substance satisfactory to the Agent.



     “Security Document” means any Security Deed, any Assignment of Leases and Rents, any Property
Management Contract Assignments, any Collateral Assignment of Interest Rate Protection Agreement,
Pledge Agreement and any other security agreement, financing statement, or other document,
instrument or agreement creating, evidencing or perfecting the Agent’s Liens in any of the
Collateral.



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     “Solvent” means, when used with respect to any Person, that (a) the fair value and the fair
salable value of its assets (excluding any Indebtedness due from any affiliate of such Person) are
each in excess of the fair valuation of its total liabilities (including all contingent liabilities
computed at the amount which, in light of all the facts and circumstances existing at such time,
represents the amount that could reasonably be expected to become an actual and matured liability);
(b) such Person is able to pay its debts or other obligations in the ordinary course as they
mature; and (c) such Person has capital not unreasonably small to carry on its business and all
business in which it proposes to be engaged.



     “S&P” means Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc.,
and its successors.



     “Stated Amount” means the amount available to be drawn by a beneficiary under a Letter of
Credit from time to time, as such amount may be increased or reduced from time to time in
accordance with the terms of such Letter of Credit.



     “Subsidiary” means, for any Person, any corporation, partnership or other entity of which at
least a majority of the Equity Interests having by the terms thereof ordinary voting power to elect
a majority of the board of directors or other individuals performing similar functions of such
corporation, partnership or other entity (without regard to the occurrence of any contingency) is
at the time directly or indirectly owned or controlled by such Person or one or more Subsidiaries
of such Person or by such Person and one or more Subsidiaries of such Person, and shall include all
Persons the accounts of which are consolidated with those of such Person pursuant to GAAP.



     “Swingline Commitment” means the Swingline Lender’s obligation to make Swingline Loans
pursuant to Section 2.2. in an amount up to, but not exceeding, $20,000,000, as such amount may be
reduced from time to time in accordance with the terms hereof.



     “Swingline Lender” means Wachovia Bank, National Association, together with its respective
successors and assigns.



     “Swingline Loan” means a loan made by the Swingline Lender to the Borrower pursuant to Section
2.2.(a).



     “Swingline Note” means the promissory note of the Borrower payable to the order of the
Swingline Lender in a principal amount equal to the amount of the Swingline Commitment as
originally in effect and otherwise duly completed, substantially in the form of Exhibit F.



     “Tangible Net Worth” means, as of a given date, (a) the stockholders’ equity of the Borrower
and Subsidiaries determined on a consolidated basis, plus (b) accumulated depreciation and
amortization, minus (c) the following (to the extent reflected in determining stockholders’ equity
of the Borrower and its Subsidiaries): (i) the amount of any write-up in the book value of any
assets contained in any balance sheet resulting from revaluation thereof or any write-up in excess
of the cost of such assets acquired, and (ii) all amounts appearing on the assets side of any such
balance sheet for assets which would be classified as intangible assets under GAAP, all



-23-









 




determined on a consolidated basis. Notwithstanding the foregoing, intangibles attributable to
Properties having above or below market rents pursuant to Statement of Financial Accounting
Standards number 141 shall not be included in either of the preceding clauses (b) and (c)




     “Taxes” has the meaning given that term in Section 3.12.



     “Tenant Improvement Rent” means, with respect to a lease of all or a portion of a Collateral
Property and on any date of determination, the rent associated with tenant improvements, as
specified in such lease, and that is being amortized over a defined portion of the lease term at a
defined interest rate. Notwithstanding the foregoing, should the Agent determine that the
aggregate contract rent payable under such lease is approximately equal to the market rent for such
Property (or portion thereof), within a reasonable range, then the Tenant Improvement Rent shall be
zero.



     “Termination Date” means November 20, 2008, or such later date to which the Termination Date
may be extended pursuant to Section 2.12.



     “Tie-In Jurisdiction” means a jurisdiction in which a “tie-in” endorsement may be obtained for
a title insurance policy covering property located in such jurisdiction which endorsement
effectively ties coverage to other title insurance policies covering properties located in other
jurisdictions.



     “Titled Agents” means each of the Arranger and any documentation agent, syndication agent, or
other Person awarded a similar honorific title in connection with this Agreement, and their
respective successors and permitted assigns.



     “Total Asset Value” means the sum of all of the following of the Borrower and its Subsidiaries
determined on a consolidated basis: (a) cash and cash equivalents, including unrestricted cash
reserves, plus (b) the GAAP book value of all Properties exclusive of depreciation, plus (c) the
aggregate amount of all Construction-in-Process of the Borrower and its Subsidiaries, plus (d) the
GAAP book value of Unimproved Land, Mortgage Receivables and other promissory notes payable to the
Borrower or any Subsidiary. The Borrower’s pro rata share of assets held by Unconsolidated
Affiliates (excluding assets of the type described in the immediately preceding clause (a)) will be
included in Total Asset Value calculations consistent with the above described treatment for wholly
owned assets.



     “Total Indebtedness” means all Indebtedness of the Borrower and all of its Subsidiaries
determined on a consolidated basis.



     “Type” with respect to any Revolving Loan, refers to whether such Loan is a LIBOR Loan or Base
Rate Loan.



     “Unconsolidated Affiliate” means, with respect to any Person, any other Person in whom such
Person holds an Investment, which Investment is accounted for in the financial statements of such
Person on an equity basis of accounting and whose financial results would not



-24-









 




be consolidated under GAAP with the financial results of such Person on the consolidated financial
statements of such Person.




     “Unfunded Liabilities” means, with respect to any Plan at any time, the amount (if any) by
which (a) the value of all benefit liabilities under such Plan, determined on a plan termination
basis using the assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds
(b) the fair market value of all Plan assets allocable to such liabilities under Title IV of ERISA
(excluding any accrued but unpaid contributions), all determined as of the then most recent
valuation date for such Plan, but only to the extent that such excess represents a potential
liability of a member of the ERISA Group to the PBGC or any other Person under Title IV of ERISA.



     “Unimproved Land” means land on which no development (other than improvements that are not
material and are temporary in nature) has occurred and for which no construction is planned in the
following 12 months.



     “Wachovia” means Wachovia Bank, National Association, together with its successors and
assigns.



     “Wholly Owned Subsidiary” means any Subsidiary of a Person in respect of which all of the
equity securities or other ownership interests (other than, in the case of a corporation,
directors’ qualifying shares) are at the time directly or indirectly owned or controlled by such
Person or one or more other Subsidiaries of such Person or by such Person and one or more other
Subsidiaries of such Person.



Section 1.2. General; References to Times.




     Unless otherwise indicated, all accounting and financial terms, ratios, obligations and
measurements shall be interpreted or determined in accordance with GAAP; provided that, if at any
time any change in GAAP would affect the computation of any financial ratio or requirement set
forth in any Loan Document, and either the Borrower or the Requisite Lenders shall so request, the
Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in GAAP (subject to the
approval of the Requisite Lenders); provided further that, until so amended, (i) such ratio or
requirement shall continue to be computed in accordance with GAAP prior to such change therein and
(ii) the Borrower shall provide to the Agent and the Lenders financial statements and other
documents required under this Agreement or as reasonably requested hereunder setting forth a
reconciliation between calculations of such ratio or requirement made before and after giving
effect to such change in GAAP. References in this Agreement to “Sections”, “Articles”, “Exhibits”
and “Schedules” are to sections, articles, exhibits and schedules herein and hereto unless
otherwise indicated. References in this Agreement to any document, instrument or agreement (a)
shall include all exhibits, schedules and other attachments thereto, (b) shall include all
documents, instruments or agreements issued or executed in replacement thereof, to the extent
permitted hereby and (c) shall mean such document, instrument or agreement, or replacement or
predecessor thereto, as amended, supplemented, restated or otherwise modified as of the date of
this Agreement and from time to time thereafter to the extent not prohibited hereby and in effect
at any given time. Wherever from the context it



-25-









 




appears appropriate, each term stated in either the singular or plural shall include the singular
and plural, and pronouns stated in the masculine, feminine or neuter gender shall include the
masculine, the feminine and the neuter. Unless explicitly set forth to the contrary, a reference
to “Subsidiary” means a Subsidiary of the Borrower or a Subsidiary of such Subsidiary and a
reference to an “Affiliate” means a reference to an Affiliate of the Borrower. Titles and captions
of Articles, Sections, subsections and clauses in this Agreement are for convenience only, and
neither limit nor amplify the provisions of this Agreement. Unless otherwise indicated, all
references to time are references to Charlotte, North Carolina time.




Section 1.3. Financial Attributes of Non-Wholly Owned Subsidiaries.




     When determining the Borrower’s compliance with any financial covenant contained in any of the
Loan Documents, only the Borrower’s pro rata share of the financial attributes of a Subsidiary that
is not a Wholly Owned Subsidiary shall be included.



Article II. Credit Facility




Section 2.1. Revolving Loans.




     (a) Generally. Subject to the terms and conditions hereof, during the period from the
Agreement Date to but excluding the Termination Date, each Lender severally and not jointly agrees
to make Revolving Loans to the Borrower in an aggregate principal amount at any one time
outstanding up to, but not exceeding, the lesser of (i) the amount of such Lender’s Commitment and
(ii) such Lender’s Commitment Percentage of the Borrowing Base. Subject to the terms and
conditions of this Agreement, during the period from the Agreement Date to but excluding the
Termination Date, the Borrower may borrow, repay and reborrow Revolving Loans hereunder.



     (b) Requesting Revolving Loans. The Borrower shall give the Agent notice pursuant to
a Notice of Borrowing or telephonic notice of each borrowing of Revolving Loans. Each Notice of
Borrowing shall be delivered to the Agent before 11:00 a.m. (i) in the case of LIBOR Loans, on the
date three Business Days prior to the proposed date of such borrowing and (ii) in the case of Base
Rate Loans, on the date one Business Day prior to the proposed date of such borrowing. Any such
telephonic notice shall include all information to be specified in a written Notice of Borrowing
and shall be promptly confirmed in writing by the Borrower pursuant to a Notice of Borrowing sent
to the Agent by telecopy on the same day of the giving of such telephonic notice. The Agent will
transmit by telecopy the Notice of Borrowing (or the information contained in such Notice of
Borrowing) to each Lender promptly upon receipt by the Agent. Each Notice of Borrowing or
telephonic notice of each borrowing shall be irrevocable once given and binding on the Borrower.



     (c) Disbursements of Revolving Loan Proceeds. No later than 1:00 p.m. on the date
specified in the Notice of Borrowing, each Lender will make available for the account of its
applicable Lending Office to the Agent at the Principal Office, in immediately available funds, the
proceeds of the Revolving Loan to be made by such Lender. With respect to Revolving Loans to be
made after the Agreement Date, unless the Agent shall have been notified by any Lender prior to the
specified date of borrowing that such Lender does not intend to make



-26-









 




available to the Agent the Revolving Loan to be made by such Lender on such date, the Agent may
assume that such Lender will make the proceeds of such Revolving Loan available to the Agent on the
date of the requested borrowing as set forth in the Notice of Borrowing and the Agent may (but
shall not be obligated to), in reliance upon such assumption, make available to the Borrower the
amount of such Revolving Loan to be provided by such Lender. Subject to satisfaction of the
applicable conditions set forth in Article VI. for such borrowing, the Agent will make the proceeds
of such borrowing available to the Borrower no later than 2:00 p.m. on the date and at the account
specified by the Borrower in such Notice of Borrowing.




Section 2.2. Swingline Loans.




     (a) Swingline Loans. Subject to the terms and conditions hereof, during the period
from the Agreement Date to but excluding the Termination Date, the Swingline Lender agrees to make
Swingline Loans to the Borrower in an aggregate principal amount at any one time outstanding up to,
but not exceeding, the amount of the Swingline Commitment. If at any time the aggregate principal
amount of the Swingline Loans outstanding at such time exceeds the Swingline Commitment in effect
at such time, the Borrower shall immediately pay the Agent for the account of the Swingline Lender
the amount of such excess. Subject to the terms and conditions of this Agreement, the Borrower may
borrow, repay and reborrow Swingline Loans hereunder.



     (b) Procedure for Borrowing Swingline Loans. The Borrower shall give the Agent and
the Swingline Lender notice pursuant to a Notice of Swingline Borrowing or telephonic notice of
each borrowing of a Swingline Loan. Each Notice of Swingline Borrowing shall be delivered to the
Swingline Lender no later than 3:00 p.m. on the proposed date of such borrowing. Any such notice
given telephonically shall include all information to be specified in a written Notice of Swingline
Borrowing and shall be promptly confirmed in writing by the Borrower pursuant to a Notice of
Swingline Borrowing sent to the Swingline Lender by telecopy on the same day of the giving of such
telephonic notice. On the date of the requested Swingline Loan and subject to satisfaction of the
applicable conditions set forth in Article VI. for such borrowing, the Swingline Lender will make
the proceeds of such Swingline Loan available to the Borrower in Dollars, in immediately available
funds, at the account specified by the Borrower in the Notice of Swingline Borrowing not later than
4:00 p.m. on such date.



     (c) Interest. Swingline Loans shall bear interest at a per annum rate equal to the
Base Rate plus the Applicable Margin for Base Rate Loans. Interest payable on Swingline
Loans is solely for the account of the Swingline Lender. All accrued and unpaid interest on
Swingline Loans shall be payable on the dates and in the manner provided in Section 2.4. with
respect to interest on Base Rate Loans (except as the Swingline Lender and the Borrower may
otherwise agree in writing in connection with any particular Swingline Loan).



     (d) Swingline Loan Amounts, Etc. Each Swingline Loan shall be in the minimum amount
of $1,000,000 and integral multiples of $100,000 or such other minimum amounts agreed to by the
Swingline Lender and the Borrower. Any voluntary prepayment of a Swingline Loan must be in
integral multiples of $100,000 or the aggregate principal amount of all outstanding Swingline Loans
(or such other minimum amounts upon which the Swingline Lender and the Borrower may agree) and in
connection with any such prepayment, the Borrower



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must give the Swingline Lender prior written notice thereof no later than 10:00 a.m. on the date of
such prepayment. The Swingline Loans shall, in addition to this Agreement, be evidenced by the
Swingline Note.




     (e) Repayment and Participations of Swingline Loans. The Borrower agrees to repay
each Swingline Loan within one Business Day of demand therefor by the Swingline Lender and in any
event, within 5 days after the date such Swingline Loan was made; provided, that the proceeds of a
Swingline Loan may not be used to repay a Swingline Loan. Notwithstanding the foregoing, the
Borrower shall repay the entire outstanding principal amount of, and all accrued but unpaid
interest on, the Swingline Loans on the Termination Date (or such earlier date as the Swingline
Lender and the Borrower may agree in writing). In lieu of demanding repayment of any outstanding
Swingline Loan from the Borrower, the Swingline Lender may, on behalf of the Borrower (which hereby
irrevocably directs the Swingline Lender to act on its behalf for such purpose), request a
borrowing of Base Rate Loans from the Lenders in an amount equal to the principal balance of such
Swingline Loan. The amount limitations of Section 3.5.(a) shall not apply to any borrowing of Base
Rate Loans made pursuant to this subsection. The Swingline Lender shall give notice to the Agent
of any such borrowing of Base Rate Loans not later than 12:00 noon on the proposed date of such
borrowing and the Agent shall give prompt notice of such borrowing to the Lenders. No later than
2:00 p.m. on such date, each Lender will make available to the Agent at the Principal Office for
the account of Swingline Lender, in immediately available funds, the proceeds of the Base Rate Loan
to be made by such Lender and, to the extent of such Base Rate Loan, such Lender’s participation in
the Swingline Loan so repaid shall be deemed to be funded by such Base Rate Loan. The Agent shall
pay the proceeds of such Base Rate Loans to the Swingline Lender, which shall apply such proceeds
to repay such Swingline Loan. At the time each Swingline Loan is made, each Lender shall
automatically (and without any further notice or action) be deemed to have purchased from the
Swingline Lender, without recourse or warranty, an undivided interest and participation to the
extent of such Lender’s Commitment Percentage in such Swingline Loan. If the Lenders are
prohibited from making Loans required to be made under this subsection for any reason, including
without limitation, the occurrence of any Default or Event of Default described in Section 11.1.(f)
or 11.1.(g), upon notice from the Agent or the Swingline Lender, each Lender severally agrees to
pay to the Agent for the account of the Swingline Lender in respect of such participation the
amount of such Lender’s Commitment Percentage of each outstanding Swingline Loan. If such amount
is not in fact made available to the Agent by any Lender, the Swingline Lender shall be entitled to
recover such amount on demand from such Lender, together with accrued interest thereon for each day
from the date of demand thereof, at the Federal Funds Rate. If such Lender does not pay such
amount forthwith upon demand therefor by the Agent or the Swingline Lender, and until such time as
such Lender makes the required payment, the Swingline Lender shall be deemed to continue to have
outstanding Swingline Loans in the amount of such unpaid participation obligation for all purposes
of the Loan Documents (other than those provisions requiring the other Lenders to purchase a
participation therein). Further, such Lender shall be deemed to have assigned any and all payments
made of principal and interest on its Loans, and any other amounts due such Lender hereunder, to
the Swingline Lender to fund Swingline Loans in the amount of the participation in Swingline Loans
that such Lender failed to purchase pursuant to this Section until such amount has been purchased
(as a result of such assignment or otherwise). A Lender’s obligation to make payments in respect
of a participation in a Swingline



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Loan shall be absolute and unconditional and shall not be affected by any circumstance whatsoever,
including without limitation, (i) any claim of setoff, counterclaim, recoupment, defense or other
right which such Lender or any other Person may have or claim against the Agent, the Swingline
Lender or any other Person whatsoever, (ii) the occurrence or continuation of a Default or Event of
Default (including without limitation, any of the Defaults or Events of Default described in
Section 11.1.(f) or 11.1.(g)) or the termination of any Lender’s Commitment, (iii) the existence
(or alleged existence) of an event or condition which has had or could have a Material Adverse
Effect, (iv) any breach of any Loan Document by the Agent, any Lender or the Borrower or (v) any
other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.




Section 2.3. Letters of Credit.




     (a) Letters of Credit. Subject to the terms and conditions of this Agreement, the
Agent, on behalf of the Lenders, agrees to issue for the account of the Borrower during the period
from and including the Agreement Date to, but excluding, the date 30 days prior to the Termination
Date one or more letters of credit (each a “Letter of Credit”) up to a maximum aggregate Stated
Amount at any one time outstanding not to exceed the L/C Commitment Amount.



     (b) Terms of Letters of Credit. At the time of issuance, the amount, form, terms and
conditions of each Letter of Credit, and of any drafts or acceptances thereunder, shall be subject
to approval by the Agent and the Borrower. Notwithstanding the foregoing, in no event may the
expiration date of any Letter of Credit extend beyond the earlier of (i) the date one year from its
date of issuance or (ii) the Termination Date; provided, however, a Letter of Credit may contain a
provision providing for the automatic extension of the expiration date in the absence of a notice
of non-renewal from the Agent but in no event shall any such provision permit the extension of the
expiration date of such Letter of Credit beyond the Termination Date.



     (c) Requests for Issuance of Letters of Credit. The Borrower shall give the Agent
written notice (or telephonic notice promptly confirmed in writing) at least 3 Business Days prior
to the requested date of issuance of a Letter of Credit, such notice to describe in reasonable
detail the proposed terms of such Letter of Credit and the nature of the transactions or
obligations proposed to be supported by such Letter of Credit and to provide a calculation of taxes
paid and payable under N.Y. Tax Law, Ch. 60, Art. 11, Sec. 253 substantially in the form of
Schedule 1 to the form of Notice of Borrowing, and in any event shall set forth with respect to
such Letter of Credit the proposed (i) Stated Amount, (ii) beneficiary, and (iii) expiration date.
The Borrower shall also execute and deliver such customary letter of credit application forms as
requested from time to time by the Agent. Provided the Borrower has given the notice prescribed by
the first sentence of this subsection and subject to the other terms and conditions of this
Agreement, including the satisfaction of any applicable conditions precedent set forth in Article
VI. and delivery to the Agent of all items required to be delivered in connection with the issuance
of such Letter of Credit, the Agent shall issue the requested Letter of Credit on the requested
date of issuance for the benefit of the stipulated beneficiary. Upon the written request of the
Borrower, the Agent shall deliver to the Borrower a copy of each issued Letter of Credit within a
reasonable time after the date of issuance thereof. To the extent any term of a Letter of Credit
Document is inconsistent with a term of any Loan Document, the term of such Loan Document shall
control.



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     (d) Reimbursement Obligations. Upon receipt by the Agent from the beneficiary of a
Letter of Credit of any demand for payment under such Letter of Credit, the Agent shall promptly
notify the Borrower of the amount to be paid by the Agent as a result of such demand and the date
on which payment is to be made by the Agent to such beneficiary in respect of such demand;
provided, however, the Agent’s failure to give, or delay in giving, such notice shall not discharge
the Borrower in any respect from the applicable Reimbursement Obligation. The Borrower hereby
unconditionally and irrevocably agrees to pay and reimburse the Agent for the amount of each demand
for payment under such Letter of Credit on or prior to the date on which payment is to be made by
the Agent to the beneficiary thereunder, without presentment, demand, protest or other formalities
of any kind (other than notice as provided in this subsection). Upon receipt by the Agent of any
payment in respect of any Reimbursement Obligation, the Agent shall promptly pay to each Lender
that has acquired a participation therein under the second sentence of Section 2.3.(i) such
Lender’s Commitment Percentage of such payment.



     (e) Manner of Reimbursement. Upon its receipt of a notice referred to in the
immediately preceding subsection (d), the Borrower shall advise the Agent whether or not the
Borrower intends to borrow hereunder to finance its obligation to reimburse the Agent for the
amount of the related demand for payment and, if it does, the Borrower shall submit a timely
request for such borrowing as provided in the applicable provisions of this Agreement. If the
Borrower fails to so advise the Agent, or if the Borrower fails to reimburse the Agent for a demand
for payment under a Letter of Credit by the date of such payment, then (i) if the applicable
conditions contained in Article VI. would permit the making of Revolving Loans, the Borrower shall
be deemed to have requested a borrowing of Revolving Loans (which shall be Base Rate Loans) in an
amount equal to the unpaid Reimbursement Obligation and the Agent shall give each Lender prompt
notice of the amount of the Revolving Loan to be made available to the Agent not later than 1:00
p.m. and (ii) if such conditions would not permit the making of Revolving Loans, the provisions of
subsection (j) of this Section shall apply. The limitations of Section 3.5.(a) shall not apply to
any borrowing of Base Rate Loans under this subsection.



     (f) Effect of Letters of Credit on Commitments. Upon the issuance by the Agent of any
Letter of Credit and until such Letter of Credit shall have expired or been terminated, the
Commitment of each Lender shall be deemed to be utilized for all purposes of this Agreement in an
amount equal to the product of (i) such Lender’s Commitment Percentage and (ii) the sum of (A) the
Stated Amount of such Letter of Credit plus (B) any related Reimbursement Obligations then
outstanding.



     (g) Agent’s Duties Regarding Letters of Credit; Unconditional Nature of Reimbursement
Obligations. In examining documents presented in connection with drawings under Letters of
Credit and making payments under Letters of Credit against such documents, the Agent shall only be
required to use the same standard of care as it uses in connection with examining documents
presented in connection with drawings under letters of credit in which it has not sold
participations and making payments under such letters of credit. The Borrower assumes all risks of
the acts and omissions of, or misuse of the Letters of Credit by, the respective beneficiaries of
such Letters of Credit. In furtherance and not in limitation of the foregoing, neither the Agent
nor any of the Lenders shall be responsible for, and the Borrower’s



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obligations in respect of the Letters of Credit shall not be affected in any manner by, (i) the
form, validity, sufficiency, accuracy, genuineness or legal effects of any document submitted by
any party in connection with the application for and issuance of or any drawing honored under any
Letter of Credit even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any Letter of Credit, or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason; (iii) failure of the beneficiary of any Letter of Credit to comply
fully with conditions required in order to draw upon such Letter of Credit; (iv) errors, omissions,
interruptions or delays in transmission or delivery of any messages, by mail, cable, telex,
telecopy or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical
terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to
make a drawing under any Letter of Credit, or of the proceeds thereof; (vii) the misapplication by
the beneficiary of the proceeds of any drawing under any Letter of Credit; or (viii) any
consequences arising from causes beyond the control of the Agent or the Lenders. None of the above
shall affect, impair or prevent the vesting of any of the Agent’s or any Lender’s rights or powers
hereunder. Any action taken or omitted to be taken by the Agent under or in connection with any
Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct (as
determined by a court of competent jurisdiction in a final, non-appealable judgment), shall not
create against the Agent or any Lender any liability to the Borrower or any Lender. In this
regard, the obligation of the Borrower to reimburse the Agent for any drawing made under any Letter
of Credit, and to repay any Revolving Loan made pursuant to the second sentence of the immediately
preceding subsection (e), shall be absolute, unconditional and irrevocable and shall be paid
strictly in accordance with the terms of this Agreement and any other applicable Letter of Credit
Document under all circumstances whatsoever, including without limitation, the following
circumstances: (A) any lack of validity or enforceability of any Letter of Credit Document or any
term or provisions therein; (B) any amendment or waiver of or any consent to departure from all or
any of the Letter of Credit Documents; (C) the existence of any claim, setoff, defense or other
right which the Borrower may have at any time against the Agent, any Lender, any beneficiary of a
Letter of Credit or any other Person, whether in connection with this Agreement, the transactions
contemplated hereby or in the Letter of Credit Documents or any unrelated transaction; (D) any
breach of contract or dispute between the Borrower, the Agent, any Lender or any other Person; (E)
any demand, statement or any other document presented under a Letter of Credit proving to be
forged, fraudulent, invalid or insufficient in any respect or any statement therein or made in
connection therewith being untrue or inaccurate in any respect whatsoever; (F) any non-application
or misapplication by the beneficiary of a Letter of Credit of the proceeds of any drawing under
such Letter of Credit; (G) payment by the Agent under any Letter of Credit against presentation of
a draft or certificate which does not strictly comply with the terms of such Letter of Credit,
except in the case of a draft or certificate that does not strictly comply, but which does
substantially comply, with the terms of such Letter of Credit and the Borrower has reconfirmed in
writing its absolute, unconditional and irrevocable obligatio
n to reimburse the Agent in respect of
any payment by the Agent under such Letter of Credit, and the Agent fails to make such payment; and
(H) any other act, omission to act, delay or circumstance whatsoever that might, but for the
provisions of this Section, constitute a legal or equitable defense to or discharge of the
Borrower’s Reimbursement Obligations. Notwithstanding anything to the contrary contained in this
Section or Section 13.9.,




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but not in limitation of the Borrower’s unconditional obligation to reimburse the Agent for any
drawing made under a Letter of Credit as provided in this Section and to repay any Revolving Loan
made pursuant to the second sentence of the immediately preceding subsection (e), the Borrower
shall have no obligation to indemnify the Agent or any Lender in respect of any liability incurred
by the Agent or such Lender arising solely out of the gross negligence or willful misconduct of the
Agent or such Lender in respect of a Letter of Credit as determined by a court of competent
jurisdiction in a final, non-appealable judgment. Except as otherwise provided in this Section,
nothing in this Section shall affect any rights the Borrower may have with respect to the gross
negligence or willful misconduct of the Agent or any Lender with respect to any Letter of Credit.




     (h) Amendments, Etc. The issuance by the Agent of any amendment, supplement or other
modification to any Letter of Credit shall be subject to the same conditions applicable under this
Agreement to the issuance of new Letters of Credit (including, without limitation, that the request
therefor be made through the Agent), and no such amendment, supplement or other modification shall
be issued unless either (i) the respective Letter of Credit affected thereby would have complied
with such conditions had it originally been issued hereunder in such amended, supplemented or
modified form or (ii) the Requisite Lenders (or all of the Lenders if required by Section 13.6.)
shall have consented thereto. In connection with any such amendment, supplement or other
modification, the Borrower shall pay the Fees, if any, payable under the last sentence of Section
3.6.(b).



     (i) Lenders’ Participation in Letters of Credit. Immediately upon the issuance by the
Agent of any Letter of Credit each Lender shall be deemed to have irrevocably and unconditionally
purchased and received from the Agent, without recourse or warranty, an undivided interest and
participation to the extent of such Lender’s Commitment Percentage of the liability of the Agent
with respect to such Letter of Credit, and each Lender thereby shall absolutely, unconditionally
and irrevocably assume, as primary obligor and not as surety, and shall be unconditionally
obligated to the Agent to pay and discharge when due, such Lender’s Commitment Percentage of the
Agent’s liability under such Letter of Credit. In addition, upon the making of each payment by a
Lender to the Agent in respect of any Letter of Credit pursuant to the immediately following
subsection (j), such Lender shall, automatically and without any further action on the part of the
Agent or such Lender, acquire (i) a participation in an amount equal to such payment in the
Reimbursement Obligation owing to the Agent by the Borrower in respect of such Letter of Credit and
(ii) a participation in a percentage equal to such Lender’s Commitment Percentage in any interest
or other amounts payable by the Borrower in respect of such Reimbursement Obligation (other than
the Fees payable to the Agent pursuant to the third and last sentences of Section 3.6.(b)).



     (j) Payment Obligation of Lenders. Each Lender severally agrees to pay to the Agent
on demand in immediately available funds in Dollars the amount of such Lender’s Commitment
Percentage of each drawing paid by the Agent under each Letter of Credit to the extent such amount
is not reimbursed by the Borrower pursuant to Section 2.3.(d); provided, however, that in respect
of any drawing under any Letter of Credit, the maximum amount that any Lender shall be required to
fund, whether as a Revolving Loan or as a participation, shall not exceed such Lender’s Commitment
Percentage of such drawing. If the notice referenced in the second



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sentence of Section 2.3.(e) is received by a Lender not later than 11:00 a.m., then such Lender
shall make such payment available to the Agent not later than 2:00 p.m. on the date of demand
therefor; otherwise, such payment shall be made available to the Agent not later than 1:00 p.m. on
the next succeeding Business Day. Each Lender’s obligation to make such payments to the Agent
under this subsection, and the Agent’s right to receive the same, shall be absolute, irrevocable
and unconditional and shall not be affected in any way by any circumstance whatsoever, including
without limitation, (i) the failure of any other Lender to make its payment under this subsection,
(ii) the financial condition of the Borrower or any other Loan Party, (iii) the existence of any
Default or Event of Default, including any Event of Default described in Section 11.1.(f) or
11.1.(g) or (iv) the termination of the Commitments. Each such payment to the Agent shall be made
without any offset, abatement, withholding or deduction whatsoever.




     (k) Information to Lenders. The Agent shall periodically deliver to the Lenders
information setting forth the Stated Amount of all outstanding Letters of Credit. Other than as
set forth in this subsection, the Agent shall have no duty to notify the Lenders regarding the
issuance or other matters regarding Letters of Credit issued hereunder. The failure of the Agent
to perform its requirements under this subsection shall not relieve any Lender from its obligations
under Section 2.3.(j).



Section 2.4. Rates and Payment of Interest on Loans.




     (a) Rates. The Borrower promises to pay to the Agent for the account of each Lender
interest on the unpaid principal amount of each Loan made by such Lender for the period from and
including the date of the making of such Loan to but excluding the date such Loan shall be paid in
full, at the following per annum rates:




     (i) during such periods as such Loan is a Base Rate Loan, at the Base Rate (as in
effect from time to time) plus the Applicable Margin; and




     (ii) during such periods as such Loan is a LIBOR Loan, at Adjusted LIBOR for such Loan
for the Interest Period therefor plus the Applicable Margin.


Notwithstanding the foregoing, while an Event of Default exists, the Borrower shall pay to the
Agent for the account of each Lender interest at the Post-Default Rate on the outstanding principal
amount of any Loan made by such Lender, on all Reimbursement Obligations and on any other amount
payable by the Borrower hereunder or under the Notes held by such Lender to or for the account of
such Lender (including without limitation, accrued but unpaid interest to the extent permitted
under Applicable Law).




     (b) Payment of Interest. Accrued and unpaid interest on each Loan shall be payable
(i) in the case of a Base Rate Loan, monthly in arrears on the first day of each calendar month,
(ii) in the case of a LIBOR Loan, in arrears on the last day of each Interest Period therefor, and,
if such Interest Period is longer than three months, at three-month intervals following the first
day of such Interest Period, and (iii) in the case of any Loan, in arrears upon the payment,
prepayment or Continuation thereof or the Conversion of such Loan to a Loan of another Type (but
only on the principal amount so paid, prepaid, Continued or Converted). Interest payable at the
Post-Default Rate shall be payable from time to time on demand. Promptly after the



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determination of any interest rate provided for herein or any change therein, the Agent shall give
notice thereof to the Lenders to which such interest is payable and to the Borrower. All
determinations by the Agent of an interest rate hereunder shall be conclusive and binding on the
Lenders and the Borrower for all purposes, absent manifest error.




Section 2.5. Number of Interest Periods.




     There may be no more than 10 different Interest Periods for LIBOR Loans outstanding at the
same time.



Section 2.6. Repayment of Loans.




     The Borrower shall repay the entire outstanding principal amount of, and all accrued but
unpaid interest on, the Revolving Loans on the Termination Date.



Section 2.7. Prepayments.




     (a) Optional. Subject to Section 5.4., the Borrower may prepay any Loan at any time
without premium or penalty. The Borrower shall give the Agent at least one Business Day’s prior
written notice of the prepayment of any Revolving Loan.



     (b) Mandatory.




     (i) Outstandings In Excess of Commitments. If at any time the aggregate
principal amount of all outstanding Revolving Loans, together with the aggregate amount of
all Letter of Credit Liabilities and the aggregate principal amount of all outstanding
Swingline Loans, exceeds the aggregate amount of the Commitments in effect at such time, the
Borrower shall immediately pay to the Agent for the accounts of the Lenders the amount of
such excess; and




     (ii) Outstandings in Excess of Borrowing Base. If at any time the aggregate
outstanding principal balance of Loans, together with the aggregate amount of all Letter of
Credit Liabilities, exceeds the Borrowing Base, then the Borrower shall, within 5 days of
the Agent’s demand, eliminate such excess. If such excess is not eliminated within such
time period, then the entire outstanding principal balance of all Loans, together with an
amount equal to the aggregate principal amount of all Letter of Credit Liabilities, shall be
immediately due and payable in full.


All payments under this Section shall be applied to pay all amounts of principal outstanding on the
Loans and any Reimbursement Obligations pro rata in accordance with Section 3.2. and if any Letters
of Credit are outstanding at such time the remainder, if any, shall be deposited into the
Collateral Account for application to any Reimbursement Obligations. If the Borrower is required
to pay any outstanding LIBOR Loans by reason of this Section prior to the end of the applicable
Interest Period therefor, the Borrower shall pay all amounts due under Section 5.4.




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Section 2.8. Continuation.




     So long as no Default or Event of Default shall exist, the Borrower may on any Business Day,
with respect to any LIBOR Loan, elect to maintain such LIBOR Loan or any portion thereof as a LIBOR
Loan by selecting a new Interest Period for such LIBOR Loan. Each new Interest Period selected
under this Section shall commence on the last day of the immediately preceding Interest Period.
Each selection of a new Interest Period shall be made by the Borrower giving to the Agent a Notice
of Continuation not later than 11:00 a.m. on the third Business Day prior to the date of any such
Continuation. Such notice by the Borrower of a Continuation shall be by telephone or telecopy,
confirmed immediately in writing if by telephone, in the form of a Notice of Continuation,
specifying (a) the proposed date of such Continuation, (b) the LIBOR Loans and portions thereof
subject to such Continuation and (c) the duration of the selected Interest Period, all of which
shall be specified in such manner as is necessary to comply with all limitations on Loans
outstanding hereunder. Each Notice of Continuation shall be irrevocable by and binding on the
Borrower once given. Promptly after receipt of a Notice of Continuation, the Agent shall notify
each Lender by telecopy, or other similar form of transmission, of the proposed Continuation. If
the Borrower shall fail to select in a timely manner a new Interest Period for any LIBOR Loan in
accordance with this Section, or if a Default or Event of Default shall exist, such Loan will
automatically, on the last day of the current Interest Period therefor, Convert into a Base Rate
Loan notwithstanding the first sentence of Section 2.9. or the Borrower’s failure to comply with
any of the terms of such Section.



Section 2.9. Conversion.




     The Borrower may on any Business Day, upon the Borrower’s giving of a Notice of Conversion to
the Agent, Convert all or a portion of a Loan of one Type into a Loan of another Type; provided,
however, a Base Rate Loan may not be Converted to a LIBOR Loan if a Default or Event of Default
shall exist. Any Conversion of a LIBOR Loan into a Base Rate Loan shall be made on, and only on,
the last day of an Interest Period for such LIBOR Loan and, upon Conversion of a Base Rate Loan
into a LIBOR Loan, the Borrower shall pay accrued interest to the date of Conversion on the
principal amount so Converted. Each such Notice of Conversion shall be given not later than 11:00
a.m. on the Business Day prior to the date of any proposed Conversion into Base Rate Loans and on
the third Business Day prior to the date of any proposed Conversion into LIBOR Loans. Promptly
after receipt of a Notice of Conversion, the Agent shall notify each Lender by telecopy, or other
similar form of transmission, of the proposed Conversion. Subject to the restrictions specified
above, each Notice of Conversion shall be by telephone (confirmed immediately in writing) or
telecopy in the form of a Notice of Conversion specifying (a) the requested date of such
Conversion, (b) the Type of Loan to be Converted, (c) the portion of such Type of Loan to be
Converted, (d) the Type of Loan such Loan is to be Converted into and (e) if such Conversion is
into a LIBOR Loan, the requested duration of the Interest Period of such Loan. Each Notice of
Conversion shall be irrevocable by and binding on the Borrower once given.



Section 2.10. Notes.




     (a) Revolving Note. The Revolving Loans made by each Lender shall, in addition to
this Agreement, also be evidenced by a promissory note of the Borrower substantially in the



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form of Exhibit G (each a “Revolving Note”), payable to the order of such Lender in a principal
amount equal to the amount of its Commitment as originally in effect and otherwise duly completed.




     (b) Records. The date, amount, interest rate, Type and duration of Interest Periods
(if applicable) of each Loan made by each Lender to the Borrower, and each payment made on account
of the principal thereof, shall be recorded by such Lender on its books and such entries shall be
binding on the Borrower, absent manifest error; provided, however, that the failure of a Lender to
make any such record shall not affect the obligations of the Borrower under any of the Loan
Documents.



     (c) Lost, Stolen, Destroyed or Mutilated Notes. Upon receipt by the Borrower of (i)
written notice from a Lender that a Note of such Lender has been lost, stolen, destroyed or
mutilated, and (ii)(x) in the case of loss, theft or destruction, an unsecured agreement of
indemnity from such Lender in form reasonably satisfactory to the Borrower, or (y) in the case of
mutilation, upon surrender and cancellation of such Note, the Borrower shall at its own expense
execute and deliver to such Lender a new Note dated the date of such lost, stolen, destroyed or
mutilated Note.



Section 2.11. Voluntary Reductions of the Commitment.




     The Borrower shall have the right to terminate or reduce the aggregate unused amount of the
Commitments (for which purpose use of the Commitments shall be deemed to include the aggregate
amount of Letter of Credit Liabilities and the aggregate principal amount of all outstanding
Swingline Loans) at any time and from time to time without penalty or premium upon not less than 5
Business Days prior written notice to the Agent of each such termination or reduction, which notice
shall specify the effective date thereof and the amount of any such reduction and shall be
irrevocable once given and effective only upon receipt by the Agent; provided, however, if the
Borrower seeks to reduce the aggregate amount of the Commitments below $40,000,000, then the
Commitments shall all automatically and permanently be reduced to zero. The Agent will promptly
transmit such notice to each Lender. The Commitments, once terminated or reduced may not be
increased or reinstated.



Section 2.12. Extension of Termination Date.




     The Borrower shall have the option, exercisable one time, to request that the Lenders extend
the Termination Date by one year. If the Borrower elects to exercise such option it shall execute
and deliver to the Agent at least 90 days but not more than 180 days prior to the current
Termination Date, a written request for such extension (an “Extension Request”). The Agent shall
forward to each Lender a copy of the Extension Request delivered to the Agent promptly upon receipt
thereof. Subject to satisfaction of the following conditions, the Termination Date shall be
extended for one year effective upon receipt of the Extension Request and payment of the fee
referred to in the following clause (c): (a) immediately prior to such extension and immediately
after giving effect thereto, (i) no Default or Event of Default shall exist and (ii) the
representations and warranties made or deemed made by the Borrower and each other Loan Party in the
Loan Documents to which any of them is a party, shall be true and correct in all material respects
on and as of the date of such extension with the same force and effect as if made on and



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as of such date except to the extent that such representations and warranties expressly relate
solely to an earlier date (in which case such representations and warranties shall have been true
and correct in all material respects on and as of such earlier date) and except for changes in
factual circumstances not prohibited under the Loan Documents; (b) all of the Lenders shall have
notified the Agent in writing within 30 days after receipt of the Extension Request that they
consent to such extension; and (c) the Borrower shall have paid the Fees payable under Section
3.6.(c). If a Lender shall fail to notify the Agent that it consents to such extension by the time
provided in the immediately preceding clause (b), then such Lender shall be deemed to have not
consented to such extension.




Section 2.13. Expiration or Maturity Date of Letters of Credit Past Termination Date.




     If on the date the Commitments are terminated or reduced to zero (whether voluntarily, by
reason of the occurrence of an Event of Default or otherwise), there are any Letters of Credit
outstanding hereunder, the Borrower shall, on such date, pay to the Agent an amount of money
necessary to cause the balance of the Collateral Account to equal the Stated Amount of such
Letter(s) of Credit for deposit into the Collateral Account.



Section 2.14. Amount Limitations.




     Notwithstanding any other term of this Agreement or any other Loan Document, no Lender shall
be required to make a Loan, the Agent shall not be required to issue a Letter of Credit and no
reduction of the Commitments pursuant to Section 2.11. shall take effect, if immediately after the
making of such Loan, the issuance of such Letter of Credit or such reduction in the Commitments the
aggregate principal amount of all outstanding Loans, together with the aggregate amount of all
Letter of Credit Liabilities, would exceed the lesser of (a) the aggregate amount of the
Commitments at such time and (b) the Borrowing Base at such time.



Section 2.15. Increase of Commitments.




     With the prior consent of the Agent, the Borrower shall have the right at any time and from
time to time to request increases in the aggregate amount of the Commitments (provided that after
giving effect to any increases in the Commitments pursuant to this Section, the aggregate amount of
the Commitments may not exceed $225,000,000) by providing written notice to the Agent, which notice
shall be irrevocable once given. Each such increase in the Commitments must be in an aggregate
minimum amount of $20,000,000 and integral multiples of $5,000,000 in excess thereof; provided,
however, the Borrower may not request more than one such increase during any period of twelve
consecutive months. No Lender shall be required to increase its Commitment and any new Lender
becoming a party to this Agreement in connection with any such requested increase must be an
Eligible Assignee. If a new Lender becomes a party to this Agreement, or if any existing Lender
agrees to increase its Commitment, such Lender shall on the date it becomes a Lender hereunder (or
increases its Commitment, in the case of an existing Lender) (and as a condition thereto) purchase
from the other Lenders its Commitment Percentage (or in the case of an existing Lender, the
increase in the amount of its Commitment Percentage, in each case as determined after giving effect
to the increase of Commitments) of any outstanding Revolving Loans, by making available to the
Agent for the account of such other Lenders at the Principal Office, in same day funds, an amount
equal to the sum of (A) the portion



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of the outstanding principal amount of such Revolving Loans to be purchased by such Lender plus (B)
the aggregate amount of payments previously made by the other Lenders under Section 2.3.(j) which
have not been repaid plus (C) interest accrued and unpaid to and as of such date on such portion of
the outstanding principal amount of such Revolving Loans. The Borrower shall pay to the Lenders
amounts payable, if any, to such Lenders under Section 5.4. as a result of the prepayment of any
such Revolving Loans. No increase of the Commitments may be effected under this Section if (x) a
Default or Event of Default shall be in existence on the effective date of such increase or (y) any
representation or warranty made or deemed made by the Borrower or any other Loan Party in any Loan
Document to which any such Loan Party is a party is not (or would not be) true or correct on the
effective date of such increase (except for representations or warranties which expressly relate
solely to an earlier date). In connection with any increase in the aggregate amount of the
Commitments pursuant to this subsection, (a) any Lender becoming a party hereto shall execute such
documents and agreements as the Agent may reasonably request and (b) the Borrower shall make
appropriate arrangements so that each new Lender, and any existing Lender increasing its
Commitment, receives a new or replacement Note, as appropriate, in the amount of such Lender’s
Commitment within 2 Business Days of the effectiveness of the applicable increase in the aggregate
amount of Commitments.




Article III. Payments, Fees and Other General Provisions




Section 3.1. Payments.




     Except to the extent otherwise provided herein, all payments of principal, interest and other
amounts to be made by the Borrower under this Agreement or any other Loan Document shall be made in
Dollars, in immediately available funds, without deduction, set-off or counterclaim, to the Agent
at its Principal Office, not later than 2:00 p.m. on the date on which such payment shall become
due (each such payment made after such time on such due date to be deemed to have been made on the
next succeeding Business Day). Subject to Section 11.4., the Borrower may, at the time of making
each payment under this Agreement or any Note, specify to the Agent the amounts payable by the
Borrower hereunder to which such payment is to be applied (provided that all amounts payable by the
Borrower hereunder shall first be applied to payments of interest and principal due and owing for
Base Rate Loans unless the Borrower otherwise notifies Agent). Each payment received by the Agent
for the account of a Lender under this Agreement or any Note shall be paid to such Lender at the
applicable Lending Office of such Lender no later than 5:00 p.m. on the date of receipt. If the
Agent fails to pay such amount to a Lender as provided in the previous sentence, the Agent shall
pay interest on such amount until paid at a rate per annum equal to the Federal Funds Rate from
time to time in effect and in no event shall the Borrower be deemed responsible for any cost or
expenses incurred by the Agent as a result of such failure. If the due date of any payment under
this Agreement or any other Loan Document would otherwise fall on a day which is not a Business Day
such date shall be extended to the next succeeding Business Day and interest shall be payable for
the period of such extension.



Section 3.2. Pro Rata Treatment.




     Except to the extent otherwise provided herein: (a) each borrowing from the Lenders under
Section 2.1.(a), 2.2.(e) and 2.3.(e) shall be made from the Lenders, each payment of the



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Fees under Section 3.6.(a), the first sentence of Section 3.6.(b) and Section 3.6.(c) shall be made
for the account of the Lenders, and each termination or reduction of the amount of the Commitments
under Section 2.11. shall be applied to the respective Commitments of the Lenders, pro rata
according to the amounts of their respective Commitments; (b) each payment or prepayment of
principal of Revolving Loans by the Borrower shall be made for the account of the Lenders pro rata
in accordance with the respective unpaid principal amounts of the Revolving Loans held by them,
provided that if immediately prior to giving effect to any such payment in respect of any Revolving
Loans the outstanding principal amount of the Revolving Loans shall not be held by the Lenders pro
rata in accordance with their respective Commitments in effect at the time such Loans were made,
then such payment shall be applied to the Revolving Loans in such manner as shall result, as nearly
as is practicable, in the outstanding principal amount of the Revolving Loans being held by the
Lenders pro rata in accordance with their respective Commitments; (c) each payment of interest on
Revolving Loans by the Borrower shall be made for the account of the Lenders pro rata in accordance
with the amounts of interest on such Loans then due and payable to the respective Lenders; (d) the
making, Conversion and Continuation of Revolving Loans of a particular Type (other than Conversions
provided for by Section 5.5.) shall be made pro rata among the Lenders according to the amounts of
their respective Commitments (in the case of making of Revolving Loans) or their respective
Revolving Loans (in the case of Conversions and Continuations of Revolving Loans) and the then
current Interest Period for each Lender’s portion of each Revolving Loan of such Type shall be
coterminous; (e) the Lenders’ participation in, and payment obligations in respect of, Letters of
Credit under Section 2.3., shall be pro rata in accordance with their respective Commitments; and
(f) the Lenders’ participation in, and payment obligations in respect of, Swingline Loans under
Section 2.2., shall be pro rata in accordance with their respective Commitments. All payments of
principal, interest, fees and other amounts in respect of the Swingline Loans shall be for the
account of the Swingline Lender only (except to the extent any Lender shall have acquired and
funded a participating interest in any such Swingline Loan pursuant to Section 2.2.(e), in which
case such payments shall be pro rata in accordance with such participating interests).




Section 3.3. Sharing of Payments, Etc.




     If a Lender shall obtain payment of any principal of, or interest on, any Loan made by it to
the Borrower under this Agreement, or shall obtain payment on any other Obligation owing by the
Borrower or any other Loan Party through the exercise of any right of set-off, banker’s lien or
counterclaim or similar right or otherwise or through voluntary prepayments directly to a Lender or
other payments made by the Borrower to a Lender not in accordance with the terms of this Agreement
and such payment should be distributed to the Lenders pro rata in accordance with Section 3.2. or
Section 11.4., as applicable, such Lender shall promptly purchase from the other Lenders
participations in (or, if and to the extent specified by such Lender, direct interests in) the
Loans made by the other Lenders or other Obligations owed to such other Lenders in such amounts,
and make such other adjustments from time to time as shall be equitable, to the end that all the
Lenders shall share the benefit of such payment (net of any reasonable expenses which may be
incurred by such Lender in obtaining or preserving such benefit) pro rata in accordance with
Section 3.2. or Section 11.4., as applicable. To such end, all the Lenders shall make appropriate
adjustments among themselves (by the resale of participations sold or otherwise) if such payment is
rescinded or must otherwise be restored. The Borrower agrees that any Lender so purchasing a
participation (or direct interest) in the Loans or other Obligations owed to such



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other Lenders may exercise all rights of set-off, banker’s lien, counterclaim or similar rights
with respect to such participation as fully as if such Lender were a direct holder of Loans in the
amount of such participation. Nothing contained herein shall require any Lender to exercise any
such right or shall affect the right of any Lender to exercise, and retain the benefits of
exercising, any such right with respect to any other indebtedness or obligation of the Borrower.




Section 3.4. Several Obligations.




     No Lender shall be responsible for the failure of any other Lender to make a Loan or to
perform any other obligation to be made or performed by such other Lender hereunder, and the
failure of any Lender to make a Loan or to perform any other obligation to be made or performed by
it hereunder shall not relieve the obligation of any other Lender to make any Loan or to perform
any other obligation to be made or performed by such other Lender.



Section 3.5. Minimum Amounts.




     (a) Borrowings and Conversions. Except as otherwise provided in Sections 2.2.(e) and
2.3.(e), each borrowing of Base Rate Loans shall be in an aggregate minimum amount of $500,000 and
integral multiples of $100,000 in excess thereof. Each borrowing, Conversion and Continuation of
LIBOR Loans shall be in an aggregate minimum amount of $100,000 and integral multiples of $100,000
in excess of that amount.



     (b) Prepayments. Each voluntary prepayment of Revolving Loans shall be in an
aggregate minimum amount of $1,000,000 and integral multiples of $100,000 in excess thereof (or, if
less, the aggregate principal amount of Revolving Loans then outstanding).



     (c) Reductions of Commitments. Each reduction of the Commitments under Section 2.11.
shall be in an aggregate minimum amount of $10,000,000 and integral multiples of $5,000,000 in
excess thereof.



     (d) Letters of Credit. The initial Stated Amount of each Letter of Credit shall be at
least $100,000.



Section 3.6. Fees.




     (a) Unused Fee. During the period from the Agreement Date to but excluding the
Termination Date, the Borrower agrees to pay to the Agent for the account of the Lenders an unused
facility fee with respect to the average daily difference between the (i) aggregate amount of the
Commitments and (ii) the aggregate principal amount of all outstanding Revolving Loans plus the
aggregate amount of all Letter of Credit Liabilities (the “Unused Amount”). Such fee shall be
computed by multiplying the Unused Amount with respect to such quarter by the corresponding per
annum rate set forth below:



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	Unused Amount	 	Unused Fee
	< 25% of the aggregate amount of Commitments
	 	 	0.0	%
	> 25% but < 50% of the aggregate amount of the Commitments
	 	 	0.10	%
	> 50% of the aggregate amount of Commitments
	 	 	0.20	%





Such fee shall be payable in arrears on the last day of each March, June, September or
December of each calendar year with the first payment of such fee being due on December 31, 2005.
Any such accrued and unpaid fee shall also be payable on the Termination Date or any earlier date
of termination of the Commitments or reduction of the Commitments to zero.




     (b) Letter of Credit Fees. The Borrower agrees to pay to the Agent for the account of
each Lender a letter of credit fee at a rate per annum equal to the Applicable Margin for LIBOR
Loans (or while an Event of Default exists, at a per annum rate equal to 4.0%) times the daily
average Stated Amount of each Letter of Credit for the period from and including the date of
issuance of such Letter of Credit (x) through and including the date such Letter of Credit expires
or is terminated or (y) to but excluding the date such Letter of Credit is drawn in full and is not
subject to reinstatement, as the case may be. The fees provided for in the immediately preceding
sentence shall be nonrefundable and payable in arrears on (i) the last day of March, June,
September and December in each year, commencing with December 31, 2005, (ii) the Termination Date,
and (iii) the date the Commitments are terminated or reduced to zero and thereafter from time to
time on demand of the Agent. In addition, the Borrower shall pay to the Agent for its own account
and not the account of any Lender, an issuance fee in respect of each Letter of Credit equal to the
greater of (i) $500 or (ii) fifteen-one hundredths of one percent (0.15%) per annum on the initial
Stated Amount of such Letter of Credit payable (A) for the period from and including the date of
issuance of such Letter of Credit through and including the expiration date of such Letter of
Credit and (B) if the expiration date of any Letter of Credit is extended (whether as a result of
the operation of an automatic extension clause or otherwise), for the period from but excluding the
previous expiration date to and including the extended expiration date. The fees provided for in
the immediately preceding sentence shall be nonrefundable and payable upon issuance (or in the case
of an extension of the expiration date, on the previous expiration date). The Borrower shall pay
directly to the Agent from time to time on demand all commissions, charges, costs and expenses in
the amounts customarily charged by the Agent from time to time in like circumstances with respect
to the issuance of each Letter of Credit, drawings, amendments and other transactions relating
thereto.



     (c) Extension Fee. If the Borrower exercises its right to extend the Termination Date
in accordance with Section 2.12., the Borrower agrees to pay to the Agent for the account of each
Lender a fee equal to two-tenths of one percent (0.20%) of the amount of such Lender’s Commitment
(whether or not utilized) at the time of such extension. Such fee shall be due and payable in full
on the date the Agent notifies the Borrower that the Lenders have approved the Extension Request
pursuant to Section 2.12.



     (d) Collateral Property Review Fee. With respect to each Property that becomes a
Collateral Property, the Borrower agrees to pay to the Agent (i) a fee equal to $1,000 for its own
account and (ii) if the Requisite Lenders were required to approve such Collateral Property



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pursuant to Section 4.1.(c)(ii), a fee equal to $1,000 for each Lender approving (or deemed to have
approved) such Property. Such fee shall be payable upon such Property becoming a Collateral
Property as provided in Section 4.2.




     (e) Administrative and Other Fees. The Borrower agrees to pay the administrative and
other fees of the Agent as may be agreed to in writing by the Borrower and the Agent from time to
time.



Section 3.7. Computations.




     Unless otherwise expressly set forth herein, any accrued interest on any Loan or any other
Obligations, and all Fees due hereunder shall be computed on the basis of a year of 365 or 366
days, as applicable, and the actual number of days elapsed, except in the case of LIBOR Loans which
shall be computed on the basis of a year of 360 days and the actual number of days elapsed.



Section 3.8. Usury.




     In no event shall the amount of interest due or payable on the Loans or other Obligations
exceed the maximum rate of interest allowed by Applicable Law and, if any such payment is paid by
the Borrower or any other Loan Party or received by any Lender, then such excess sum shall be
credited as a payment of principal, unless the Borrower shall notify the respective Lender in
writing that the Borrower elects to have such excess sum returned to it forthwith. It is the
express intent of the parties hereto that the Borrower not pay and the Lenders not receive,
directly or indirectly, in any manner whatsoever, interest in excess of that which may be lawfully
paid by the Borrower under Applicable Law.



Section 3.9. Agreement Regarding Interest and Charges.




     The parties hereto hereby agree and stipulate that the only charge imposed upon the Borrower
for the use of money in connection with this Agreement is and shall be the interest specifically
described in Section 2.4.(a)(i) and (ii) and in Section 2.2.(c). Notwithstanding the foregoing,
the parties hereto further agree and stipulate that all agency fees, syndication fees, unused fees,
closing fees, letter of credit fees, underwriting fees, default charges, late charges, funding or
“breakage” charges, increased cost charges, attorneys’ fees and reimbursement for costs and
expenses paid by the Agent or any Lender to third parties or for damages incurred by the Agent or
any Lender, in each case in connection with the transactions contemplated by this Agreement and the
other Loan Documents, are charges made to compensate the Agent or any such Lender for underwriting
or administrative services and costs or losses performed or incurred, and to be performed or
incurred, by the Agent and the Lenders in connection with this Agreement and shall under no
circumstances be deemed to be charges for the use of money. All charges other than charges for the
use of money shall be fully earned and nonrefundable when due.




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Section 3.10. Statements of Account.




     The Agent will account to the Borrower monthly with a statement of Loans, Letters of Credit,
accrued interest and Fees, charges and payments made pursuant to this Agreement and the other Loan
Documents, and such account rendered by the Agent shall be deemed conclusive upon Borrower absent
manifest error. The failure of the Agent to deliver such a statement of accounts shall not relieve
or discharge the Borrower from any of its obligations hereunder.



     Section 3.11. Defaulting Lenders.



     (a) Generally. If for any reason any Lender (a “Defaulting Lender”) shall fail or
refuse to perform any of its obligations under this Agreement or any other Loan Document to which
it is a party within the time period specified for performance of such obligation or, if no time
period is specified, if such failure or refusal continues for a period of two Business Days after
notice from the Agent, then, in addition to the rights and remedies that may be available to the
Agent or the Borrower under this Agreement or Applicable Law, such Defaulting Lender’s right to
participate in the administration of the Loans, this Agreement and the other Loan Documents,
including without limitation, any right to vote in respect of, to consent to or to direct any
action or inaction of the Agent or to be taken into account in the calculation of the Requisite
Lenders, shall be suspended during the pendency of such failure or refusal. If a Lender is a
Defaulting Lender because it has failed to make timely payment to the Agent of any amount required
to be paid to the Agent hereunder (without giving effect to any notice or cure periods), in
addition to other rights and remedies which the Agent or the Borrower may have under the
immediately preceding provisions or otherwise, the Agent shall be entitled (i) to collect interest
from such Defaulting Lender on such delinquent payment for the period from the date on which the
payment was due until the date on which the payment is made at the Federal Funds Rate, (ii) to
withhold or setoff and to apply in satisfaction of the defaulted payment and any related interest,
any amounts otherwise payable to such Defaulting Lender under this Agreement or any other Loan
Document and (iii) to bring an action or suit against such Defaulting Lender in a court of
competent jurisdiction to recover the defaulted amount and any related interest. Any amounts
received by the Agent in respect of a Defaulting Lender’s Loans shall not be paid to such
Defaulting Lender and shall be held uninvested by the Agent and either applied against the purchase
price of such Loans under the following subsection (b) or paid to such Defaulting Lender upon such
Defaulting Lender’s curing of its default.



     (b) Purchase or Cancellation of Defaulting Lender’s Commitment. Any Lender who is not
a Defaulting Lender may, but shall not be obligated, in its sole discretion, to acquire all or a
portion of a Defaulting Lender’s Commitment. Any Lender desiring to exercise such right shall give
written notice thereof to the Agent and the Borrower no sooner than 2 Business Days and not later
than 5 Business Days after such Defaulting Lender became a Defaulting Lender. If more than one
Lender exercises such right, each such Lender shall have the right to acquire an amount of such
Defaulting Lender’s Commitment in proportion to the Commitments of the other Lenders exercising
such right. If after such 5th Business Day, the Lenders have not elected to purchase all of the
Commitment of such Defaulting Lender, then the Borrower may, by giving written notice thereof to
the Agent, such Defaulting Lender and the other Lenders, either (i) demand that such Defaulting
Lender assign its Commitment to an Eligible Assignee subject to and in accordance with the
provisions of Section 13.5.(d) for the purchase price provided for



- 43 -









 







below or (ii) terminate the Commitment of such Defaulting Lender, whereupon such Defaulting Lender
shall no longer be a party hereto or have any rights or obligations hereunder or under any of the
other Loan Documents. No party hereto shall have any obligation whatsoever to initiate any such
replacement or to assist in finding an Eligible Assignee. Upon any such purchase or assignment,
the Defaulting Lender’s interest in the Loans and its rights hereunder (but not its liability in
respect thereof or under the Loan Documents or this Agreement to the extent the same relate to the
period prior to the effective date of the purchase except to the extent assigned pursuant to such
purchase) shall terminate on the date of purchase, and the Defaulting Lender shall promptly execute
all documents reasonably requested to surrender and transfer such interest to the purchaser or
assignee thereof, including an appropriate Assignment and Acceptance Agreement and, notwithstanding
Section 13.5.(d), shall pay to the Agent an assignment fee in the amount of $7,000. The purchase
price for the Commitment of a Defaulting Lender shall be equal to the amount of the principal
balance of the Loans outstanding and owed by the Borrower to the Defaulting Lender. Prior to
payment of such purchase price to a Defaulting Lender, the Agent shall apply against such purchase
price any amounts retained by the Agent pursuant to the last sentence of the immediately preceding
subsection (a). The Defaulting Lender shall be entitled to receive amounts owed to it by the
Borrower under the Loan Documents which accrued prior to the date of the default by the Defaulting
Lender, to the extent the same are received by the Agent from or on behalf of the Borrower. There
shall be no recourse against any Lender or the Agent for the payment of such sums except to the
extent of the receipt of payments from any other party or in respect of the Loans. Notwithstanding
anything herein to the contrary other than Section 13.16., if the Borrower actually incurs any
loss, penalty or other damages (including without limitation the loss of any security deposit in
connection with any planned acquisition by the Borrower) as a result of such Defaulting Lender’s
failure to fund its Commitment in accordance with the terms hereof, the Borrower shall have all
rights and remedies which it may be entitled to under this Agreement or Applicable Law.



Section 3.12. Taxes.




     (a) Taxes Generally. All payments by the Borrower of principal of, and interest on,
the Loans and all other Obligations shall be made free and clear of and without deduction for any
present or future excise, stamp or other taxes, fees, duties, levies, imposts, charges, deductions,
withholdings or other charges of any nature whatsoever imposed by any taxing authority, but
excluding (i) franchise taxes, (ii) any taxes imposed on or measured by any Lender’s assets, net
income, receipts or branch profits, (iii) any taxes (other than withholding taxes) with respect to
the Agent or a Lender that would not be imposed but for a connection between the Agent or such
Lender and the jurisdiction imposing such taxes (other than a connection arising solely by virtue
of the activities of the Agent or such Lender pursuant to or in respect of this Agreement or any
other Loan Document), and (iv) any taxes, fees, duties, levies, imposts, charges, deductions,
withholdings or other charges to the extent imposed as a result of the failure of the Agent or a
Lender, as applicable, to provide and keep current (to the extent legally able) any certificates,
documents or other evidence required to qualify for an exemption from, or reduced rate of, any such
taxes fees, duties, levies, imposts, charges, deductions, withholdings or other charges or required
by the immediately following subsection (c) to be furnished by the Agent or such Lender, as
applicable (such non-excluded items being collectively called “Taxes”). If any withholding or
deduction from any payment to be made by the Borrower hereunder is required in respect of any Taxes
pursuant to any Applicable Law, then the Borrower will:



- 44 -









 






     (i) pay directly to the relevant Governmental Authority the full amount required to be
so withheld or deducted;




     (ii) promptly forward to the Agent an official receipt or other documentation
satisfactory to the Agent evidencing such payment to such Governmental Authority; and




     (iii) pay to the Agent for its account or the account of the applicable Lender, as the
case may be, such additional amount or amounts as is necessary to ensure that the net amount
actually received by the Agent or such Lender will equal the full amount that the Agent or
such Lender would have received had no such withholding or deduction been required.



     (b) Tax Indemnification. If the Borrower fails to pay any Taxes when due to the
appropriate Governmental Authority or fails to remit to the Agent, for its account or the account
of the respective Lender, as the case may be, the required receipts or other required documentary
evidence, the Borrower shall indemnify the Agent and the Lenders for any incremental Taxes,
interest or penalties that may become payable by the Agent or any Lender as a result of any such
failure. For purposes of this Section, a distribution hereunder by the Agent or any Lender to or
for the account of any Lender shall be deemed a payment by the Borrower.



     (c) Tax Forms. Prior to the date that any Foreign Lender becomes a party hereto, such
Foreign Lender shall deliver to the Borrower and the Agent such certificates, documents or other
evidence, as required by the Internal Revenue Code or Treasury Regulations issued pursuant thereto
(including Internal Revenue Service Forms W-8ECI and W-8BEN, as applicable, or appropriate
successor forms), properly completed, currently effective and duly executed by such Foreign Lender
establishing that payments to it hereunder and under the Notes are (i) not subject to United States
Federal backup withholding tax and (ii) not subject to United States Federal withholding tax
imposed under the Internal Revenue Code. Each such Foreign Lender shall, to the extent it may
lawfully do so, (x) deliver further copies of such forms or other appropriate certifications on or
before the date that any such forms expire or become obsolete and after the occurrence of any event
requiring a change in the most recent form delivered to the Borrower or the Agent and (y) obtain
such extensions of the time for filing, and renew such forms and certifications thereof, as may be
reasonably requested by the Borrower or the Agent. The Borrower shall not be required to pay any
amount pursuant to the last sentence of subsection (a) above to any Foreign Lender or the Agent, if
it is organized under the laws of a jurisdiction outside of the United States of America, if such
Foreign Lender or the Agent, as applicable, fails to comply with the requirements of this
subsection. If any such Foreign Lender, to the extent it may lawfully do so, fails to deliver the
above forms or other documentation, then the Agent may withhold from any payments to be made to
such Foreign Lender under any of the Loan Documents such amounts as are required by the Internal
Revenue Code. If any Governmental Authority asserts that the Agent did not properly withhold or
backup withhold, as the case may be, any tax or other amount from payments made to or for the
account of any Lender, such Lender shall indemnify the Agent therefor, including all penalties and
interest, any taxes imposed by any jurisdiction on the amounts payable to the Agent under this
Section, and costs and expenses (including all reasonable fees and disbursements of any law firm or
other



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external counsel and the allocated cost of internal legal services and all disbursements of
internal counsel) of the Agent. The obligation of the Lenders under this Section shall survive the
termination of the Commitments, repayment of all Obligations and the resignation or replacement of
the Agent.



Article IV. Collateral Properties




Section 4.1. Eligibility of Properties.




     (a) As of the Agreement Date, the parties agree that the Properties identified on Schedule
4.1. are Collateral Properties and have the Appraised Values and Implied Debt Service Values set
forth on such Schedule. The amount of the Borrowing Base as of the Agreement Date is as set forth
on such Schedule.



     (b) If, after the Agreement Date, the Borrower desires that any additional Property be
included in calculations of the Borrowing Base, the Borrower shall so notify the Agent in writing.
No Property will be evaluated for inclusion as a Collateral Property unless it is an Eligible
Property (subject to the immediately following subsection (c)(ii)), and unless and until the
Borrower delivers to the Agent each of the following, in form and substance reasonably satisfactory
to the Agent:




     (i) a description of such Property, such description to include the age, location, size
and occupancy rate of such Property;




     (ii) an operating statement and rent roll with respect to such Property for each of the
two prior fiscal years and for the current fiscal year through the fiscal quarter most
recently ending and for the current fiscal quarter, certified by a representative of the
Borrower to the best of such representative’s knowledge as being true and correct in all
material respects; provided, that (x) with respect to any period such Property was not owned
by a Loan Party, such information shall only be required to be delivered to the extent
reasonably available to the Borrower and (y) if such Property has not been in operation for
at least two years, the Borrower shall provide such projections and other information
concerning the anticipated operation of such Property as the Agent may request;




     (iii) a pro forma operating statement or an operating budget for such Property with
respect to the current and immediately following fiscal years;




     (iv) a budget for capital expenditures for the immediately following 12-month period
showing funding sources reasonably acceptable to the Agent;




     (v) a “Phase I” environmental assessment of such Property not more than 12 months old
prepared by an environmental engineering firm acceptable to the Agent and upon which the
Agent and the Lenders are expressly permitted to rely, and any additional environmental
studies or assessments performed with respect to such Property that are readily available
to, or obtainable by, the Borrower without undue expense;



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     (vi) copies of all material permits and licenses relating to the use, ownership,
occupancy and operation of such Property;




     (vii) an inspection report prepared by an architect or engineer acceptable to the Agent
and addressed to the Agent for the benefit of the Lenders with respect to such Property;




     (viii) if requested by the Agent, copies of all engineering, mechanical, structural and
maintenance studies performed with respect to such Property not more than twelve months old
and that are readily available to, or obtainable by, the Borrower without undue expense;




     (ix) evidence that the insurance that will be required under the applicable Loan
Document for such Property if admitted as a Collateral Property will be in effect; and




     (x) such other information the Agent may reasonably request in order to evaluate such
Property.



     (c) If such Property is an Eligible Property, then the procedures regarding the approval of
such Property contained in the following clause (i) shall apply. Otherwise, the procedures
contained in the immediately following clause (ii) shall apply.




     (i) Within 10 Business Days after receipt and review of the foregoing, the Agent will
notify the Borrower and each Lender if the Agent is prepared to proceed with acceptance of
such Property as a Collateral Property. Upon the earlier of (A) the Borrower’s request or
(B) the Agent notifying the Borrower and Lenders that the Agent is prepared to proceed with
acceptance of such Property as a Collateral Property, the Agent will order an Appraisal of
such Property in order to determine the Appraised Value thereof. After obtaining such
Appraisal, the Agent shall notify the Borrower and the Lenders whether the Agent approves of
the designation of such Property as a Collateral Property within 5 Business Days of receipt
of all such documents and information including the Appraisal and if it does, the Agent
shall notify the Borrower and the Lenders of the Appraised Value and provide each Lender
with a copy of such Appraisal for approval by the Requisite Lenders within 5 Business Days
thereafter. If the Agent shall fail to so notify the Borrower and the Lenders, then the
Agent shall be deemed to have not approved the designation of such Property as a Collateral
Property. If a Lender shall fail to notify the Agent of its approval of such an Appraisal
and Appraised Value, then such Lender shall be deemed to have approved of such Appraisal and
Appraised Value. Upon approval of such Property by the Agent, approval of the Appraisal and
Appraised Value by the Requisite Lenders and execution and delivery of all of the documents
required to be provided under Section 4.2., such Property shall become a Collateral Property
and shall be included in determinations of the Borrowing Base in accordance with the terms
hereof.




     (ii) Within 15 Business Days after receipt and review of the foregoing, the Agent will
notify the Borrower and each Lender if the Agent is prepared to proceed with



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acceptance of such Property as a Collateral Property. Upon the earlier of (A) the
Borrower’s request or (B) the Agent notifying the Borrower and Lenders that the Agent is
prepared to proceed with acceptance of such Property as a Collateral Property, the Agent
will order an Appraisal of such Property in order to determine the Appraised Value thereof.
After obtaining such Appraisal, the Agent will promptly submit the foregoing documents and
information, including the Appraisal and the Appraised Value, to the Lenders, for approval
by the Requisite Lenders within 10 Business Days thereafter. Each Lender shall notify the
Agent whether it approves of the designation of such Property as a Collateral Property
within 10 Business Days of receipt of all such documents and information. If a Lender shall
fail to so notify the Agent, then such Lender shall be deemed to have approved of such
Property. Upon approval (or deemed approval) of such Property by the Requisite Lenders, and
upon execution and delivery of all of the documents required to be provided under Section
4.2., such Property shall become a Collateral Property and shall be included in
determinations of the Borrowing Base in accordance with the terms hereof.



     (d) In the case of any Property located in a jurisdiction imposing a mortgage recording tax,
the Agent and the Lenders agree to take such actions as the Borrower may reasonably request to
achieve any mortgage tax savings, including taking an assignment of an existing Mortgage.



Section 4.2. Conditions Precedent to a Property Becoming a Collateral Property.




     No Property shall become a Collateral Property until the Borrower shall have caused to be
executed and delivered to the Agent and the Lenders all documents and instruments required to be so
executed and delivered under Section 4.1., the Agent or the Requisite Lenders, as applicable, shall
have approved of, or shall have been deemed to have approved of, such Property as provided in
subsection (c) of such Section, and the Borrower shall have caused to be executed and delivered to
the Agent the following instruments, documents and agreements in respect of such Property, each to
be in form and substance satisfactory to the Agent:



     (a) a Security Deed executed by the Loan Party owning (or leasing) such Property, the form of
such Security Deed to be modified as appropriate (i) to conform to the Applicable Laws of the
jurisdiction in which such Property is located and (ii) to implement the provisions of Section
4.1.(d);



     (b) an Assignment of Leases and Rents executed by such Loan Party, the form of such Assignment
of Leases and Rents to be modified as appropriate (i) to conform to the Applicable Laws of the
jurisdiction in which such Property is located and (ii) to implement the provisions of Section
4.1.(d);



     (c) an Environmental Indemnity Agreement executed by each such Loan Party, and if not the
Borrower, the Borrower;



     (d) copies of (i) all Property Management Agreements and all other material contracts, if any,
which will relate to the use, occupancy, operation, maintenance, enjoyment or ownership of such
Property (other than (x) any service or maintenance contract that is cancelable



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by such Loan Party upon not more than 30 days prior notice and (y) any such contract that would
terminate upon foreclosure of such Security Deed or transfer of such Property pursuant to a deed in
lieu of foreclosure of such Security Deed), and (ii) if such Property is not yet owned by the
Borrower or a Subsidiary, the purchase agreement pursuant to which the Borrower or a Subsidiary is
to acquire such Property;



     (e) a Property Management Contract Assignment executed by such Loan Party and the applicable
property manager;



     (f) if requested by the Agent, collateral assignments of the other material contracts,
operating permits and licenses, franchise or license agreements and any other rights or benefits of
such Property, relating to the use, occupancy, operation, maintenance, enjoyment or ownership of
such Property;



     (g) an ALTA 1992 Form mortgagee’s Policy of Title Insurance (with deletion of the creditor’s
rights exclusion and deletion of the mandatory arbitration provision) or other form acceptable to
the Agent in favor of the Agent for the benefit of the Lenders with respect to such Property,
including endorsements with respect to such items of coverage as the Agent may reasonably request
(and which endorsements are available in the applicable state), in a coverage amount equal to no
less than 100% of the Appraised Value of such Property (subject to increase without material
additional cost through the use of “tie-in” endorsements or other provisions), issued by a title
insurance company acceptable to the Agent and with coinsurance (which the Agent confirms will not
be required on the Agreement Date for the initial Collateral Properties identified on Schedule
4.1.) or reinsurance (with direct access agreements) with title insurance companies acceptable to
the Agent, showing the fee simple title (or a leasehold estate if leased under a Ground Lease) to
the land and improvements described in the applicable Security Deed as vested in the Borrower or a
Subsidiary, and insuring that the Lien granted by such Security Deed is a valid first priority Lien
against such Property, subject only to such restrictions, encumbrances, easements and reservations
as are reasonably acceptable to the Agent;



     (h) copies of all documents of record reflected in Schedule B of such Policy of Title
Insurance;



     (i) if such Property is located in a Tie-In Jurisdiction, endorsements to all other existing
title insurance policies issued to the Agent with respect to all other Properties located in Tie-In
Jurisdictions reflecting an increase in the aggregate insured amount under the “tie-in”
endorsements to an amount equal to the aggregate amount of the Appraised Values of all such
Properties (including the Property to be included as a Collateral Property) but in no event in an
amount in excess of the aggregate amount of the Commitments;



     (j) a current or currently certified survey of such Property certified to the Agent and the
Lenders by a surveyor licensed in the jurisdiction where such Property is located to have been
prepared in accordance with the then effective Minimum Standard Detail Requirements for ALTA/ACSM
Land Title Surveys;



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     (k) if not adequately covered by the survey certification, a certificate from a licensed
engineer or other professional satisfactory to the Agent that such Property is not located in a
Special Flood Hazard Area as defined by the Federal Insurance Administration, or, if it is,
evidence of flood insurance;



     (l) evidence that such Property complies with applicable zoning and land use laws or that such
Property is the subject of a legal non-conforming use;



     (m) final certificates of occupancy relating to such Property, if available and if requested
by the Agent;



     (n) UCC, tax, judgment and lien search reports with respect to such Loan Party and such
Property in all necessary or appropriate jurisdictions and under all legal and appropriate trade
names indicating that there are no Liens of record on such Property or any of the Collateral
relating thereto other than Permitted Liens or Liens to be terminated prior to such Property’s
acceptance as a Collateral Property;



     (o) copies of all leases of such Property and lease abstracts in form and substance acceptable
to Agent relating to such leases covering 5,000 or more square feet of such Property;



     (p) estoppel certificates and subordination, non-disturbance and attornment agreements (or a
Statement of Lease or other comparable document in the case of a lease to the United States or
governmental agency thereof) from each tenant leasing 5,000 or more square feet of such Property
and in any event from tenants renting in the aggregate at least 85% of the square feet of such
Property;



     (q) if the Borrower or another Loan Party has entered into a Derivatives Contract to hedge
interest rate risk associated with Indebtedness incurred by the Borrower or such Loan Party to
finance the acquisition or ownership of such Property:




     (i) a fully executed copy of such Derivatives Contract, including all schedules and
confirmations relating thereto;




     (ii) a Collateral Assignment of Interest Rate Protection Agreement executed by the
Borrower or such Loan Party, as the case may be; and




     (iii) a Counterparty Acknowledgement in the form attached to such Collateral Assignment
of Interest Rate Protection Agreement executed by the counterparty to such Derivatives
Contract;



     (r) an opinion of counsel admitted to practice law in the jurisdiction in which such Property
is located and reasonably acceptable to the Agent, addressed to the Agent and each Lender covering
such legal matters relating to the transactions contemplated hereby as the Agent may reasonably
request;



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     (s) an opinion of counsel qualified to render legal opinions regarding the law of the
jurisdiction in which the Borrower is formed (or if the Property is owned or leased by a
Subsidiary, in the jurisdiction where such Subsidiary is formed) acceptable to the Agent, addressed
to the Agent and each Lender covering such legal matters relating to the formation and existence
and power of the Person executing documents, and the due authorization, execution and delivery of
the applicable Security Documents and other documents for consummating the transactions
contemplated hereby as the Agent may reasonably request;



     (t) if such Property is owned by, or leased to, a Subsidiary that is not already a Guarantor,
an Accession Agreement executed by such Subsidiary and all of the items that would have been
required to be delivered to the Agent under Section 6.1.(a)(iv) through (viii) and (xviii) had such
Subsidiary been a Loan Party on the Agreement Date;



     (u) a Borrowing Base Certificate calculated after giving effect to the inclusion of such
Property as a Collateral Property; and



     (v) such other due diligence materials, instruments, documents, agreements, financing
statements, certificates, opinions and other Security Documents consistent with the existing terms
and conditions of the Loan Documents as the Agent may reasonably request.



Section 4.3. Release of Collateral Properties.




     From time to time the Borrower may request, upon not less than 10 Business Days prior written
notice to the Agent, that a Collateral Property be released from the Liens created by the Security
Documents applicable thereto, which release (the “Release”) shall be effected by the Agent if all
of the following conditions are satisfied as of the date of such Release:



     (a) no Default or Event of Default exists or would exist immediately after giving effect to
such Release;



     (b) the representations and warranties made or deemed made by the Borrower and each other Loan
Party in the Loan Documents to which any of them is a party, shall be true and correct in all
material respects on and as of the date of such extension with the same force and effect as if made
on and as of such date except to the extent that such representations and warranties expressly
relate solely to an earlier date (in which case such representations and warranties shall have been
true and correct in all material respects on and as of such earlier date) and except for changes in
factual circumstances not prohibited under the Loan Documents;



     (c) the Borrower shall have delivered to the Agent all documents and instruments reasonably
requested by the Agent in connection with such Release including, without limitation, the
following:




     (i) a quitclaim deed or other instrument to be used to effect such Release; and




     (ii) an appropriate endorsement to the mortgagee title insurance policy in effect with
respect to the affected Collateral Property (and appropriate corrective



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endorsements with respect to any other mortgagee policies of title insurance on Collateral
Properties which have tie-in clauses which are affected by the release); and



     (d) the Borrower shall have delivered a Compliance Certificate giving pro forma effect to such
Release;



     (e) the Borrower shall have delivered to the Agent a Borrowing Base Certificate reflecting the
Borrowing Base after giving effect to such Release and indicating that the aggregate outstanding
principal balance of Loans, together with the aggregate amount of all Letter of Credit Liabilities,
will not exceed the Borrowing Base after giving effect to such Release; and



     (f) the outstanding principal balance of the Loans, together with the aggregate principal
amount of all Letter of Credit Liabilities, will not exceed the Borrowing Base after giving effect
to such Release and any prepayment to be made and/or the acceptance of any Property pursuant to
Section 4.1. which is to be given concurrently with such Release as an additional or replacement
Collateral Property.


In connection with a Release, the Borrower shall deliver to the Agent a certificate from the
Borrower’s chief executive officer or chief financial officer regarding the matters referred to in
the immediately preceding clauses (a) and (b). After giving effect to any request that a
Collateral Property owned by a Subsidiary cease to be included in determinations of the Borrowing
Base, the Borrower may request in writing that the Agent release, and upon receipt of such request
the Agent shall release, (x) such Subsidiary from the Guaranty as provided in and subject to
Section 8.12.(b) and (y) if such Collateral Property is a NY Property, the Equity Interest of the
NY Owner that owns such NY Property from the Lien created by the Pledge Agreement. In the case of
any Collateral Property located in a jurisdiction imposing a mortgage recording tax, the Agent
agrees to take such actions as the Borrower may reasonably request to achieve any mortgage tax
savings in connection with such Release, including without limitation, reassigning, on an “as is”
basis and without recourse, the applicable Security Deed to the Borrower or such other Person as
Borrower may reasonably request in connection with such Release.




Section 4.4. Frequency of Calculations of Borrowing Base.




     Initially, the Borrowing Base shall be the amount set forth as such in the Borrowing Base
Certificate delivered under Section 6.1. Thereafter, the Borrowing Base shall be the amount set
forth as such in the Borrowing Base Certificate delivered from time to time under Section 4.2.(t),
4.3.(e), 4.7., 4.8.(b)(iv) or 9.4.(h). Any increase in the Borrowing Base shall become effective
as of the next determination of the Borrowing Base as provided in this Section, provided that (a)
the applicable Borrowing Base Certificate substantiates such increase and (b) if the increase in
the Borrowing Base is attributable in whole or in part to an increase in the Appraised Value of a
Collateral Property, the Borrower delivers to the Agent prior to the effectiveness of such increase
the following: (i) with respect to any such Collateral Property not located in a Tie-In
Jurisdiction, an endorsement to the title insurance policy in favor of the Agent with respect to
such Property increasing the coverage amount thereof as related to such Property to not less than
100% of the Appraised Value of such Property and (ii) with respect to any such Collateral Property
located in a Tie-In Jurisdiction, an endorsement to the title insurance policy in favor of the
Agent with



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respect to such Property increasing the coverage amount thereof as related to such Property to not
less than the Appraised Value of such Property, as well as endorsements to all other existing title
insurance policies issued to the Agent with respect to all other Properties located in Tie-In
Jurisdictions reflecting an increase in the aggregate insured amount under the “tie-in”
endorsements to an amount equal to the aggregate amount of the Appraised Values of all such
Properties (including any Collateral Property to which the increase in the Borrowing Base is
attributable) but in no event in an amount in excess of the aggregate amount of the Commitments.



Section 4.5. Frequency of Appraisals.




     The Appraised Value of a Collateral Property shall be determined or redetermined, as
applicable, under each of the following circumstances:



     (a) In connection with the acceptance of a Property as a Collateral Property the Agent shall
determine the Appraised Value thereof as provided in Section 4.1.; or



     (b) From time to time upon at least 5 Business Days written notice to the Borrower and at the
Borrower’s expense, the Agent may (and shall at the direction of the Requisite Lenders) redetermine
the Appraised Value of a Collateral Property (based on a new Appraisal obtained by the Agent) if
necessary in order to comply with a specific provision of FIRREA or other Applicable Law relating
to the Agent or the Lenders pursuant to the terms of Section 4.6.; or



     (c) Following any “Casualty Event” under and as defined in any Security Deed or any
“Condemnation Event” under and as defined in any Security Deed; provided that no Appraisal shall be
required and no change shall occur in the value of the Collateral Property in the Borrowing Base
affected by a Casualty Event so long as (i) insurance proceeds in an amount sufficient to restore
the Collateral Property to the state they existed prior to the Casualty Event are available, (ii)
the Borrower has agreed with the Lenders to reconstruct the improvements to the state they existed
prior to the Casualty Event and (iii) the Agent has a perfected first-priority Lien in such
insurance proceeds; provided, further that no Appraisal shall be required for condemnations (x)
that do not take any of the improvements of a Collateral Property and do not otherwise impair the
operations of the Collateral Property and (y) the condemnation proceeds are applied to repay the
Obligations; or



     (d) Upon the Borrower’s written request for a redetermination of the Appraised Value of a
Property, the Agent shall redetermine the Appraised Value of such Property (based on a new
Appraisal of such Property obtained by the Agent), all at the Borrower’s expense.



Section 4.6. Additional Appraisals Required under Applicable Law.




     If under a specific provision of FIRREA or any other Applicable Law, a Lender is required to
obtain an Appraisal of any Collateral Property in addition to any other Appraisal previously
obtained with respect to such Property pursuant to this Agreement, the Agent shall have the right
to cause such an Appraisal to be prepared at the Borrower’s cost and expense. The Borrowing Base
shall be redetermined as a result of delivery of any such new Appraisal if



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Applicable Law requires such redetermination, in which case the Borrowing Base shall be
redetermined in the manner required under such Applicable Law.



Section 4.7. Release of Derivatives Contract




     From time to time the Borrower may request, upon not less than 10 Business Days prior written
notice to the Agent, that a Derivatives Contract be release from the Lien of a Collateral
Assignment of Interest Rate Protection Agreement, which release shall be effected by the Agent if
all of the following conditions are satisfied as of the date of such release:



     (a) no Default or Event of Default exists or would exist immediately after giving effect to
such release; and



     (b) the Borrower shall have delivered to the Agent a Borrowing Base Certificate reflecting the
Borrowing Base after giving effect to the change in the Implied Debt Service Value of the
applicable Collateral Property resulting from such release and indicating that the aggregate
outstanding principal balance of Loans, together with the aggregate amount of all Letter of Credit
Liabilities, will not exceed the Borrowing Base after giving effect to such release.


Once a Derivatives Contract has been released pursuant to this Section, it shall not be taken into
account in the calculation of the Implied Debt Service Value of a Collateral Property without the
prior written consent of the Requisite Lenders.




Section 4.8. Additional Provision Applicable to the NY Properties.




     (a) [Intentionally Omitted].



     (b) Limitation on Amount Secured by Security Deeds on NY Properties. A Security Deed
encumbering a NY Property shall contain a limitation on the principal amount of the Obligations
secured thereby equal to the Appraised Value of such NY Property. In addition, such a limitation
may initially be for an amount less than the Appraised Value of the applicable NY Property as
requested by the Borrower. Nothwithstanding Sections 4.2.(g) and 4.4., the amount of title
insurance for such a NY Property may be equal to the amount of such limitation. Upon written
request from the Borrower, the amount of such a limitation may be increased, such increase to be
effective only upon delivery to the Agent of each of the following, in form and substance
reasonably satisfactory to the Agent:




     (i) a modification to such Security Deed executed by the applicable NY Owner and
providing for the increase of such limitation;




     (ii) evidence that all taxes payable in connection with the increase of such
limitation, including without limitation, any tax payable under N.Y. Tax Law, Ch. 60, Art.
11, Sec. 253, shall have been paid;




     (iii) an endorsement to the title insurance policy insuring such Security Deed
increasing the amount of coverage thereunder to account for the increase in such



- 54 -









 







limitation and bringing the effective date of such policy forward to the date of recording
of the modification to such Security Deed;




     (iv) a Borrowing Base Certificate reflecting the Borrowing Base after giving effect to
the increase in such limitation; and




     (v) such other documents, agreements and instruments as the Agent may reasonably
request.


If the Requisite Lenders determine that the aggregate amount of liabilities of a NY Owner exceeds
an amount deemed material by the Requisite Lenders in their sole discretion, then upon the Agent’s
demand the Borrower agrees to increase the limitation on the principal amount of the Obligations
secured by the applicable Security Deed encumbering the applicable NY Property owned by such NY
Owner by such amount as the Requisite Lenders may request in their sole discretion (but in no even
shall the limitation on the principal amount of the Obligations secured by such Security Deed
exceed the Appraised Value of such NY Property). To effect such increase the Borrower shall cause
to be executed and delivered to the Agent the items referred to in the immediately preceding
clauses (i), (ii), (iii) and (v) within 5 Business Days of the Agent’s demand.




     (c) [Intentionally Omitted].



     (d) Organizational Documents of NY Owners. So long as a NY Property is a Collateral
Property, the Borrower shall cause the operating agreement and other applicable organization
documents of the NY Owner that owns such NY Property to contain customary provisions in form and
substance satisfactory to the Agent intended to make such NY Owner a single purpose, bankruptcy
remote entity and to limit the incurrence of additional Indebtedness and the granting of additional
Mortgages on such NY Property, such provisions to include, without limitation, (i) a requirement
that at least one manager of such NY Owner be independent (ii) a requirement for unanimous manager
consent for such NY Owner to file a voluntary bankruptcy petition, (iii) a prohibition on the
incurrence of Indebtedness other than Obligations of such NY Owner under the Guaranty and other
Loan Documents to which it is a party, and (iv) a prohibition on the granting of Liens other than
the Lien granted by the Security Deed encumbering such NY Property. In addition such operating
agreement and other applicable organization documents shall contain provisions in form and
substance satisfactory to the Agent providing that (x) all Equity Interests in such NY Owner shall
be securities governed by Article 8 of the Uniform Commercial Code as in effect in the jurisdiction
of formation of such NY Owner and (y) all such Equity Interests must be certificated securities.



Article V. Yield Protection, Etc.




Section 5.1. Additional Costs; Capital Adequacy.




     (a) Additional Costs. The Borrower shall promptly pay to the Agent for the account of
each affected Lender from time to time such amounts as such Lender may reasonably determine to be
necessary to compensate such Lender for any costs incurred by such Lender that it reasonably
determines are attributable to its making or maintaining of any LIBOR Loans or its



- 55 -









 







obligation to make any LIBOR Loans hereunder, any reduction in any amount receivable by such Lender
under this Agreement or any of the other Loan Documents in respect of any of such Loans or such
obligation or the maintenance by such Lender of capital in respect of its Loans or its Commitment
(such increases in costs and reductions in amounts receivable being herein called “Additional
Costs”), to the extent resulting from any Regulatory Change that: (i) changes the basis of
taxation of any amounts payable to such Lender under this Agreement or any of the other Loan
Documents in respect of any of such Loans or its Commitment (other than taxes, fees, duties,
levies, imposts, charges, deductions, withholdings or other charges which are excluded from the
definition of Taxes pursuant to the first sentence of Section 3.12.(a)); or (ii) imposes or
modifies any reserve, special deposit or similar requirements (other than Regulation D of the Board
of Governors of the Federal Reserve System or other reserve requirement to the extent utilized in
the determination of Adjusted LIBOR for such Loan) relating to any extensions of credit or other
assets of, or any deposits with or other liabilities of, such Lender, or any commitment of such
Lender (including, without limitation, the Commitment of such Lender hereunder); or (iii) has or
would have the effect of reducing the rate of return on capital of such Lender to a level below
that which such Lender could have achieved but for such Regulatory Change (taking into
consideration such Lender’s policies with respect to capital adequacy).



     (b) Lender’s Suspension of LIBOR Loans. Without limiting the effect of the provisions
of the immediately preceding subsection (a), if, by reason of any Regulatory Change, any Lender
either (i) incurs Additional Costs based on or measured by the excess above a specified level of
the amount of a category of deposits or other liabilities of such Lender that includes deposits by
reference to which the interest rate on LIBOR Loans is determined as provided in this Agreement or
a category of extensions of credit or other assets of such Lender that includes LIBOR Loans or (ii)
becomes subject to restrictions on the amount of such a category of liabilities or assets that it
may hold, then, if such Lender so elects by notice to the Borrower (with a copy to the Agent), the
obligation of such Lender to make or Continue, or to Convert any other Type of Loans into, LIBOR
Loans hereunder shall be suspended until such Regulatory Change ceases to be in effect (in which
case the provisions of Section 5.5. shall apply).



     (c) Additional Costs in Respect of Letters of Credit. Without limiting the
obligations of the Borrower under the preceding subsections of this Section (but without
duplication), if as a result of any Regulatory Change or any risk-based capital guideline or other
requirement heretofore or hereafter issued by any Governmental Authority there shall be imposed,
modified or deemed applicable any tax, reserve, special deposit, capital adequacy or similar
requirement against or with respect to or measured by reference to Letters of Credit and the result
shall be to increase the cost to the Agent of issuing (or any Lender of purchasing participations
in) or maintaining its obligation hereunder to issue (or purchase participations in) any Letter of
Credit or reduce any amount receivable by the Agent or any Lender hereunder in respect of any
Letter of Credit, then, upon demand by the Agent or such Lender, the Borrower shall pay promptly,
and in any event within 3 Business Days of demand, to the Agent for its account or the account of
such Lender, as applicable, from time to time as specified by the Agent or a Lender, such
additional amounts as shall be sufficient to compensate the Agent or such Lender for such increased
costs or reductions in amount.



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     (d) Notification and Determination of Additional Costs. Each of the Agent and each
Lender agrees to notify the Borrower of any event occurring after the Agreement Date entitling the
Agent or such Lender to compensation under any of the preceding subsections of this Section as
promptly as practicable; provided, however, the failure of the Agent or any Lender to give such
notice shall not release the Borrower from any of its obligations hereunder (and in the case of a
Lender, to the Agent); provided further that no Lender shall be entitled to claim any additional
cost, reduction in amounts, loss, tax or other additional amount under this Section if such Lender
fails to provide such notice to the Borrower within 180 days of the date such Lender becomes aware
of the occurrence of the event giving rise to the additional cost, reduction in amounts, loss, tax
or other additional amount. The Agent or such Lender agrees to furnish to the Borrower (and in the
case of a Lender, to the Agent) a certificate setting forth in reasonable detail the basis and
amount of each request by the Agent or such Lender for compensation under this Section. Absent
manifest error, determinations by the Agent or any Lender of the effect of any Regulatory Change
shall be conclusive, provided that such determinations are made on a reasonable basis and in good
faith.



Section 5.2. Suspension of LIBOR Loans.




     Anything herein to the contrary notwithstanding, if, on or prior to the determination of
Adjusted LIBOR for any Interest Period:




     (a) the Agent reasonably determines (which determination shall be conclusive) that by
reason of circumstances affecting the relevant market, adequate and reasonable means do not
exist for ascertaining Adjusted LIBOR for such Interest Period, or




     (b) the Agent reasonably determines (which determination shall be conclusive) that
Adjusted LIBOR will not adequately and fairly reflect the cost to the Lenders of making or
maintaining LIBOR Loans for such Interest Period;


then the Agent shall give the Borrower and each Lender prompt notice thereof and, so long as such
condition remains in effect, the Lenders shall be under no obligation to, and shall not, make
additional LIBOR Loans, Continue LIBOR Loans or Convert Loans into LIBOR Loans and the Borrower
shall, on the last day of each current Interest Period for each outstanding LIBOR Loan, either
repay such Loan or Convert such Loan into a Base Rate Loan.




Section 5.3. Illegality.




     Notwithstanding any other provision of this Agreement, if any Lender shall reasonably
determine (which determination shall be conclusive and binding) that it has become unlawful for
such Lender to honor its obligation to make or maintain LIBOR Loans hereunder, then such Lender
shall promptly notify the Borrower thereof (with a copy to the Agent) and such Lender’s obligation
to make or Continue, or to Convert Loans of any other Type into, LIBOR Loans shall be suspended
until such time as such Lender may again make and maintain LIBOR Loans (in which case the
provisions of Section 5.5. shall be applicable).



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Section 5.4. Compensation.




     The Borrower shall pay to the Agent for the account of each Lender, upon the request of such
Lender through the Agent, such amount or amounts as shall be sufficient (in the reasonable opinion
of such Lender) to compensate it for any loss, cost or expense that such Lender reasonably
determines is attributable to:




     (a) any payment or prepayment (whether mandatory or optional) of a LIBOR Loan, or
Conversion of a LIBOR Loan, made by such Lender for any reason (including, without
limitation, acceleration) on a date other than the last day of the Interest Period for such
Loan; or




     (b) any failure by the Borrower for any reason (including, without limitation, the
failure of any of the applicable conditions precedent specified in Article VI. to be
satisfied) to borrow a LIBOR Loan from such Lender on the requested date for such borrowing,
or to Convert a Base Rate Loan into a LIBOR Loan or Continue a LIBOR Loan on the requested
date of such Conversion or Continuation.


Upon the Borrower’s request, any Lender requesting compensation under this Section shall provide
the Borrower with a statement setting forth in reasonable detail the basis for requesting such
compensation and the method for determining the amount thereof. Absent manifest error,
determinations by any Lender in any such statement shall be conclusive, provided that such
determinations are made on a reasonable basis and in good faith.




Section 5.5. Treatment of Affected Loans.




     If the obligation of any Lender to make LIBOR Loans or to Continue, or to Convert Base Rate
Loans into, LIBOR Loans shall be suspended pursuant to Section 5.1.(b) or 5.3., then such Lender’s
LIBOR Loans shall be automatically Converted into Base Rate Loans on the last day(s) of the then
current Interest Period(s) for LIBOR Loans (or, in the case of a Conversion required by Section
5.1.(b) or 5.3., on such earlier date as such Lender may specify to the Borrower with a copy to the
Agent) and, unless and until such Lender gives notice as provided below that the circumstances
specified in Section 5.1. or 5.3. that gave rise to such Conversion no longer exist:




     (a) to the extent that such Lender’s LIBOR Loans have been so Converted, all payments
and prepayments of principal that would otherwise be applied to such Lender’s LIBOR Loans
shall be applied instead to its Base Rate Loans; and




     (b) all Loans that would otherwise be made or Continued by such Lender as LIBOR Loans
shall be made or Continued instead as Base Rate Loans, and all Base Rate Loans of such
Lender that would otherwise be Converted into LIBOR Loans shall remain as Base Rate Loans.


If such Lender gives notice to the Borrower (with a copy to the Agent) that the circumstances
specified in Section 5.1. or 5.3. that gave rise to the Conversion of such Lender’s LIBOR Loans
pursuant to this Section no longer exist (which such Lender agrees to do promptly upon such
circumstances ceasing to exist) at a time when LIBOR Loans made by other Lenders are


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outstanding, then such Lender’s Base Rate Loans shall be automatically Converted, on the first
day(s) of the next succeeding Interest Period(s) for such outstanding LIBOR Loans, to the extent
necessary so that, after giving effect thereto, all Loans held by the Lenders holding LIBOR Loans
and by such Lender are held pro rata (as to principal amounts, Types and Interest Periods) in
accordance with their respective Commitments.




Section 5.6. Change of Lending Office.




     Each Lender agrees that it will use reasonable efforts to designate an alternate Lending
Office with respect to any of its Loans affected by the matters or circumstances described in
Section 3.12., 5.1. or 5.3. to reduce the liability of the Borrower or avoid the results provided
thereunder, so long as such designation is not disadvantageous to such Lender as determined by such
Lender in its sole discretion, except that such Lender shall have no obligation to designate a
Lending Office located in the United States of America.



Section 5.7. Assumptions Concerning Funding of LIBOR Loans.




     Calculation of all amounts payable to a Lender under this Article V. shall be made as though
such Lender had actually funded LIBOR Loans through the purchase of deposits in the relevant
market bearing interest at the rate applicable to such LIBOR Loans in an amount equal to the amount
of the LIBOR Loans and having a maturity comparable to the relevant Interest Period; provided,
however, that each Lender may fund each of its LIBOR Loans in any manner it sees fit and the
foregoing assumption shall be used only for calculation of amounts payable under this Article V.



Article VI. Conditions Precedent




Section 6.1. Initial Conditions Precedent.




     The obligation of the Lenders to effect or permit the occurrence of the first Credit Event
hereunder, whether as the making of a Loan or the issuance of a Letter of Credit, is subject to the
following conditions precedent:



     (a) The Agent shall have received each of the following, in form and substance satisfactory to
the Agent:




     (i) Counterparts of this Agreement executed by each of the parties hereto;




     (ii) Revolving Notes executed by the Borrower, payable to each Lender and complying
with the applicable provisions of Section 2.10., and the Swingline Note executed by the
Borrower;




     (iii) The Guaranty executed by each Subsidiary that owns or leases a Collateral
Property as of the Agreement Date and each Material Subsidiary (other than any Excluded
Subsidiary) as of the Agreement Date;



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     (iv) An opinion or opinions of counsel to the Loan Parties, addressed to the Agent, the
Lenders and the Swingline Lender, addressing the matters set forth in Exhibit H;




     (v) The articles of incorporation, articles of organization, certificate of limited
partnership or other comparable organizational instrument (if any) of the Borrower and each
other Loan Party certified as of a recent date by the Secretary of State of the state of
formation of such Loan Party;




     (vi) A certificate of good standing or certificate of similar meaning with respect to
each Loan Party issued as of a recent date by the Secretary of State of the state of
formation of each such Loan Party and certificates of qualification to transact business or
other comparable certificates issued by each Secretary of State (and any state department of
taxation, as applicable) of each state in which such Loan Party is required to be so
qualified and where the failure to be so qualified could reasonably be expected to have a
Material Adverse Effect;




     (vii) A certificate of incumbency signed by the Secretary or Assistant Secretary (or
other individual performing similar functions) of each Loan Party with respect to each of
the officers of such Loan Party authorized to execute and deliver the Loan Documents to
which such Loan Party is a party, and in the case of the Borrower, and the officers of the
Borrower then authorized to deliver Notices of Borrowing, Notices of Swingline Borrowings,
Notices of Continuation and Notices of Conversion and to request the issuance of Letters of
Credit;




     (viii) Copies certified by the Secretary or Assistant Secretary (or other individual
performing similar functions) of each Loan Party of (i) the by-laws of such Loan Party, if a
corporation, the operating agreement of such Loan Party, if a limited liability company, the
partnership agreement of such Loan Party, if a limited or general partnership, or other
comparable document in the case of any other form of legal entity and (ii) all corporate,
partnership, member or other necessary action taken by such Loan Party to authorize the
execution, delivery and performance of the Loan Documents to which it is a party;




     (ix) The Fees then due and payable under Section 3.6., and any other Fees payable to
the Agent, the Titled Agents and the Lenders on or prior to the Agreement Date;




     (x) A Compliance Certificate calculated as of September 30, 2005 (giving pro forma
effect to the financing contemplated by this Agreement and the use of the proceeds of the
Loans to be funded on the Closing Date);




     (xi) A Borrowing Base Certificate calculated as of the Agreement Date;




     (xii) A letter from the agent bank under the Existing Credit Agreement providing
information regarding the payment in full of amounts outstanding under the



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Existing Credit Agreement and providing for the termination thereof and the release of all
Liens securing any obligations owing thereunder;




     (xiii) All of the items required to be delivered under Sections 4.1. and 4.2. with
respect to each Property identified on Schedule 4.1.;




     (xiv) The results of a lien search in each of the jurisdictions in which UCC financing
statements or other filings or recordations should be made to evidence or perfect security
interests in Collateral (as defined in the Pledge Agreement), including without limitation
the jurisdiction of formation of the Borrower, such search results to reveal no Liens of
record with respect to any of such Collateral;




     (xv) The Pledge Agreement executed by the Borrower;




     (xvi) All certificates representing any shares of Equity Interests pledged pursuant to
the Pledge Agreement, together with an undated stock power for each such certificate
executed in blank by a duly authorized officer of the Borrower, together with an
Acknowledgment and Consent, substantially in the form of Schedule 2 to the Pledge Agreement,
duly executed by each of the NY Owners;




     (xvii) UCC financing statements describing the Collateral (as defined in the Pledge
Agreement) to be filed in New York and such other jurisdictions as necessary to perfect the
security interest purported to be created by the Pledge Agreement; and




     (xviii) Such other documents, agreements and instruments as the Agent on behalf of the
Lenders may reasonably request; and



     (b) In the good faith judgment of the Agent and the Lenders:




     (i) There shall not have occurred or become known to the Agent or any of the Lenders
any event, condition, situation or status since the date of the information contained in the
financial and business projections, budgets, pro forma data and forecasts concerning the
Borrower and its Subsidiaries delivered to the Agent and the Lenders prior to the Agreement
Date that has had or could reasonably be expected to result in a Material Adverse Effect;




     (ii) No litigation, action, suit, investigation or other arbitral, administrative or
judicial proceeding shall be pending or threatened which could reasonably be expected to (1)
result in a Material Adverse Effect or (2) restrain or enjoin, or otherwise materially and
adversely affect the ability of the Borrower or any other Loan Party to fulfill its
obligations under the Loan Documents to which it is a party;




     (iii) The Borrower and its Subsidiaries shall have received all approvals, consents and
waivers, and shall have made or given all necessary filings and notices, as shall be
required to consummate the transactions contemplated hereby without the occurrence of any
default under, conflict with or violation of (1) any Applicable Law or



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(2) any agreement, document or instrument to which the Borrower or any other Loan Party is a
party or by which any of them or their respective properties is bound, except for such
approvals, consents, waivers, filings and notices the receipt, making or giving of which
would not reasonably be likely to (A) have a Material Adverse Effect, or (B) restrain or
enjoin, or otherwise materially and adversely affect the ability of the Borrower or any
other Loan Party to fulfill its obligations under the Loan Documents to which it is a party;
and




     (iv) There shall not have occurred or exist any other material disruption of financial
or capital markets that could reasonably be expected to materially and adversely affect the
transactions contemplated by the Loan Documents.



Section 6.2. Conditions Precedent to All Loans and Letters of Credit.




     The obligations of the Lenders to make any Loans, of the Agent to issue Letters of Credit, and
of the Swingline Lender to make any Swingline Loan are all subject to the further condition
precedent that: (a) no Default or Event of Default shall exist as of the date of the making of such
Loan or date of issuance of such Letter of Credit or would exist immediately after giving effect
thereto; (b) the representations and warranties made or deemed made by the Borrower and each other
Loan Party in the Loan Documents to which any of them is a party, shall be true and correct in all
material respects on and as of the date of the making of such Loan or date of issuance of such
Letter of Credit with the same force and effect as if made on and as of such date except to the
extent that such representations and warranties expressly relate solely to an earlier date (in
which case such representations and warranties shall have been true and correct in all material
respects on and as of such earlier date) and except for changes in factual circumstances not
prohibited under the Loan Documents; (c) all stamp, intangible, registration, recordation and
similar taxes, fees and charges payable under N.Y. Tax Law, Ch. 60, Art. 11, Sec. 253 and other
Applicable Law in connection with the making of such Loan or the issuance of such Letter of Credit
shall have been paid; and (d) except in the case of the Loans made on the Agreement Date, the
Borrower shall have delivered to the Agent evidence acceptable to the Agent that all taxes, fees
and charges described in the immediately predecing clause (c) have been paid. Each Credit Event
shall constitute a certification by the Borrower to the effect set forth in the preceding sentence
(both as of the date of the giving of notice relating to such Credit Event and, unless the Borrower
otherwise notifies the Agent prior to the date of such Credit Event, as of the date of the
occurrence of such Credit Event). In addition, if such Credit Event is the making of a Loan or the
issuance of a Letter of Credit, the Borrower shall be deemed to have represented to the Agent and
the Lenders at the time such Loan is made or Letter of Credit issued that all conditions to the
occurrence of such Credit Event contained in this Article VI. have been satisfied.



Article VII. Representations and Warranties




Section 7.1. Representations and Warranties.




     In order to induce the Agent and each Lender to enter into this Agreement and to make Loans
and issue Letters of Credit, the Borrower represents and warrants to the Agent and each Lender as
follows:



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     (a) Organization; Power; Qualification. Each of the Borrower, its Subsidiaries and
the other Loan Parties is a corporation, partnership or other legal entity, duly organized or
formed, validly existing and in good standing under the jurisdiction of its incorporation or
formation, has the power and authority to own or lease its respective properties and to carry on
its respective business as now being and hereafter proposed to be conducted and is duly qualified
and is in good standing as a foreign corporation, partnership or other legal entity, and authorized
to do business, in each jurisdiction in which the character of its properties or the nature of its
business requires such qualification or authorization and where the failure to be so qualified or
authorized could reasonably be expected to have, in each instance, a Material Adverse Effect.



     (b) Ownership Structure. As of the Agreement Date, Part I of Schedule 7.1.(b) is a
complete and correct list of all Subsidiaries of the Borrower setting forth for each such
Subsidiary, (i) the jurisdiction of organization of such Subsidiary, (ii) each Person holding any
Equity Interests in such Subsidiary, (iii) the nature of the Equity Interests held by each such
Person, (iv) the percentage of ownership of such Subsidiary represented by such Equity Interests
and (v) whether such Subsidiary is a Material Subsidiary and/or an Excluded Subsidiary. Except as
disclosed in such Schedule, as of the Agreement Date (x) each of the Borrower and its Subsidiaries
owns, free and clear of all Liens (other than Permitted Liens), and has the unencumbered right to
vote, all outstanding Equity Interests in each Person shown to be held by it on such Schedule, (y)
all of the issued and outstanding capital stock of each such Person organized as a corporation is
validly issued, fully paid and nonassessable and (z) there are no outstanding subscriptions,
options, warrants, commitments, preemptive rights or agreements of any kind (including, without
limitation, any stockholders’ or voting trust agreements) for the issuance, sale, registration or
voting of, or outstanding securities convertible into, any additional shares of capital stock of
any class, or partnership or other ownership interests of any type in, any such Person. As of the
Agreement Date Part II of Schedule 7.1.(b) correctly sets forth all Unconsolidated Affiliates of
the Borrower, including the correct legal name of such Person, the type of legal entity which each
such Person is, and all Equity Interests in such Person held directly or indirectly by the
Borrower.



     (c) Authorization of Agreement, Etc. The Borrower has the right and power, and has
taken all necessary action to authorize it, to borrow and obtain other extensions of credit
hereunder. The Borrower and each other Loan Party has the right and power, and has taken all
necessary action to authorize it, to execute, deliver and perform each of the Loan Documents to
which it is a party in accordance with their respective terms and to consummate the transactions
contemplated hereby and thereby. The Loan Documents to which the Borrower or any other Loan Party
is a party have been duly executed and delivered by the duly authorized officers of such Person and
each is a legal, valid and binding obligation of such Person enforceable against such Person in
accordance with its respective terms except as the same may be limited by bankruptcy, insolvency,
and other similar laws affecting the rights of creditors generally and the availability of
equitable remedies for the enforcement of certain obligations (other than the payment of principal)
contained herein or therein and as may be limited by equitable principles generally.



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     (d) Compliance of Loan Documents with Laws, Etc. The execution, delivery and
performance of this Agreement, the Notes and the other Loan Documents to which the Borrower or any
other Loan Party is a party in accordance with their respective terms and the borrowings and other
extensions of credit hereunder do not and will not, by the passage of time, the giving of notice,
or both: (i) require any Governmental Approval or violate any Applicable Law (including all
Environmental Laws) relating to the Borrower or any other Loan Party; (ii) conflict with, result in
a breach of or constitute a default under the organizational documents of the Borrower or any other
Loan Party, or any indenture, agreement or other instrument to which the Borrower or any other Loan
Party is a party or by which it or any of its respective properties may be bound; or (iii) result
in or require the creation or imposition of any Lien upon or with respect to any property now owned
or hereafter acquired by the Borrower or any other Loan Party other than those created under the
Loan Documents.



     (e) Compliance with Law; Governmental Approvals. Each of the Borrower, each
Subsidiary and each other Loan Party is in compliance with each Governmental Approval applicable to
it and in compliance with all other Applicable Laws (including without limitation, Environmental
Laws) relating to the Borrower, a Subsidiary or such other Loan Party except for noncompliances
which, and Governmental Approvals the failure to possess which, could not, individually or in the
aggregate, reasonably be expected to cause a Default or Event of Default or have a Material Adverse
Effect.



     (f) Title to Properties; Liens. As of the Agreement Date, Schedule 7.1.(f) is a
complete and correct listing of all of the real property owned or leased by the Borrower, each
other Loan Party and each other Subsidiary. Each such Person has good, marketable and legal title
to, or a valid leasehold interest in, its respective assets. As of the Agreement Date, there are
no Liens against any assets of the Borrower, any Subsidiary or any other Loan Party except for
Permitted Liens.



     (g) Existing Indebtedness. Schedule 7.1.(g) is, as of the Agreement Date, a complete
and correct listing of all Indebtedness of the Borrower and its Subsidiaries, including without
limitation, Guarantees of the Borrower and its Subsidiaries, and indicating whether such
Indebtedness is Secured Indebtedness or Unsecured Indebtedness and if such Indebtedness is
Nonrecourse Indebtedness.



     (h) Material Contracts. Schedule 7.1.(h) is, as of the Agreement Date, a true,
correct and complete listing of all Material Contracts. No event or condition exists which with
the giving of notice, the lapse of time, or both, would permit any party to any such Material
Contract to terminate such Material Contract.



     (i) Litigation. Except as set forth on Schedule 7.1.(i), there are no actions, suits,
investigations or proceedings pending (nor, to the knowledge of the Borrower, are there any
actions, suits or proceedings threatened) against or in any other way relating adversely to or
affecting the Borrower, any Subsidiary or any other Loan Party or any of its respective property in
any court or before any arbitrator of any kind or before or by any other Governmental Authority
which could reasonably be expected to have a Material Adverse Effect. There are no strikes, slow
downs, work stoppages or walkouts or other labor disputes in progress or threatened



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relating to the Borrower, any Subsidiary or any other Loan Party which could reasonably be expected
to have a Material Adverse Effect.



     (j) Taxes. All federal, state and other tax returns of the Borrower, any Subsidiary
or any other Loan Party required by Applicable Law to be filed have been duly filed, and all
federal, state and other taxes, assessments and other governmental charges or levies upon the
Borrower, any Subsidiary and each other Loan Party and its respective properties, income, profits
and assets which are due and payable have been paid, except any such nonpayment which is at the
time permitted under Section 8.6. As of the Agreement Date, none of the United States income tax
returns of the Borrower, its Subsidiaries or any other Loan Party is under audit. All charges,
accruals and reserves on the books of the Borrower and each of its Subsidiaries and each other Loan
Party in respect of any taxes or other governmental charges are in accordance with GAAP.



     (k) Financial Statements. The Borrower has made available to each Lender copies of
(i) the audited consolidated balance sheet of the Borrower and its consolidated Subsidiaries for
the fiscal year ending December 31, 2004, and the related audited consolidated statements of
operations, cash flows and shareholders’ equity for the fiscal year ending on such dates, with the
opinion thereon of Ernst & Young LLP, and (ii) the unaudited consolidated balance sheet of the
Borrower and its consolidated Subsidiaries for the fiscal quarter ending September 30, 2005, and
the related unaudited consolidated statements of operations, cash flows and shareholders’ equity of
the Borrower and its consolidated Subsidiaries for the period of three fiscal quarters ending on
such date. Such financial statements (including in each case related schedules and notes) present
fairly, in all material respects and in accordance with GAAP consistently applied throughout the
periods involved, the consolidated financial position of the Borrower and its consolidated
Subsidiaries as at their respective dates and the results of operations and the cash flow for such
periods (subject, as to interim statements, to changes resulting from normal year-end audit
adjustments). Neither the Borrower nor any of its Subsidiaries has on the Agreement Date any
material contingent liabilities, liabilities, liabilities for taxes, unusual or long-term
commitments or unrealized or forward anticipated losses from any unfavorable commitments that would
be required to be set forth in its financial statements or in the notes thereto, except as referred
to or reflected or provided for in said financial statements.



     (l) No Material Adverse Change. Since December 31, 2004, there has been no material
adverse change in the business, assets, liabilities, financial condition, results of operations,
business or prospects of the Borrower and its Subsidiaries taken as a whole. Each of the Borrower,
its Subsidiaries and the other Loan Parties is Solvent.



     (m) ERISA. Each member of the ERISA Group is in compliance with its obligations under
the minimum funding standards of ERISA and the Internal Revenue Code with respect to each Plan and
is in compliance with the presently applicable provisions of ERISA and the Internal Revenue Code
with respect to each Plan, except in each case for noncompliances which could not reasonably be
expected to have a Material Adverse Effect. As of the Agreement Date, no member of the ERISA Group
has (i) sought a waiver of the minimum funding standard under Section 412 of the Internal Revenue
Code in respect of any Plan, (ii) failed to make any contribution or payment to any Plan or
Multiemployer Plan or in respect of any Benefit



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Arrangement, or made any amendment to any Plan or Benefit Arrangement, which has resulted or could
result in the imposition of a Lien or the posting of a bond or other security under ERISA or the
Internal Revenue Code or (iii) incurred any liability under Title IV of ERISA other than a
liability to the PBGC for premiums under Section 4007 of ERISA.



     (n) Not Plan Assets; No Prohibited Transaction. None of the assets of the Borrower,
any Subsidiary or any other Loan Party constitute “plan assets” within the meaning of ERISA, the
Internal Revenue Code and the respective regulations promulgated thereunder. The execution,
delivery and performance of this Agreement and the other Loan Documents, and the borrowing and
repayment of amounts hereunder, do not and will not constitute “prohibited transactions” under
ERISA or the Internal Revenue Code.



     (o) Absence of Defaults. Neither the Borrower, any Subsidiary nor any other Loan
Party is in default under its articles of incorporation, bylaws, partnership agreement or other
similar organizational documents, and no event has occurred, which has not been remedied, cured or
waived, which, in any such case: (i) constitutes a Default or an Event of Default; or (ii)
constitutes, or which with the passage of time, the giving of notice, or both, would constitute, a
default or event of default by the Borrower, any Subsidiary or any other Loan Party under any
agreement (other than this Agreement) or judgment, decree or order to which the Borrower or any
Subsidiary or other Loan Party is a party or by which the Borrower or any Subsidiary or other Loan
Party or any of their respective properties may be bound where such default or event of default
could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.



     (p) Environmental Laws. Each of the Borrower, its Subsidiaries and the other Loan
Parties has obtained all Governmental Approvals which are required under Environmental Laws and is
in compliance with all terms and conditions of such Governmental Approvals which the failure to
obtain or to comply with could reasonably be expected to have a Material Adverse Effect. Except
for any of the following matters that could not be reasonably expected to have a Material Adverse
Effect and except as set forth in the environmental reports described on Schedule 7.1.(p) with
respect to the Properties identified on Schedule 4.1., the Borrower is not aware of, and has not
received written notice of, any past, present, or future events, conditions, circumstances,
activities, practices, incidents, actions, or plans which, with respect to the Borrower, its
Subsidiaries and each other Loan Party, may interfere with or prevent compliance or continued
compliance with Environmental Laws, or may give rise to any common-law or legal liability, or
otherwise form the basis of any claim, action, demand, suit, proceeding, hearing, study, or
investigation, based on or related to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport, or handling or the emission, discharge, release or threatened release
into the environment, of any Hazardous Material. Except for matters that could not be reasonably
expected to have a Material Adverse Effect, there is no civil, criminal, or administrative action,
suit, demand, claim, hearing, notice, or demand letter, notice of violation, investigation, or
proceeding pending or, to the Borrower’s knowledge after due inquiry, threatened, against the
Borrower, its Subsidiaries and each other Loan Party relating in any way to Environmental Laws.



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     (q) Investment Company; Public Utility Holding Company. Neither the Borrower nor any
Subsidiary nor any other Loan Party is (i) an “investment company” or a company “controlled” by an
“investment company” within the meaning of the Investment Company Act of 1940, as amended, (ii) a
“holding company” or a “subsidiary company” of a “holding company”, or an “affiliate” of a “holding
company” or of a “subsidiary company” of a “holding company”, within the meaning of the Public
Utility Holding Company Act of 1935, as amended, or (iii) subject to any other Applicable Law which
purports to regulate or restrict its ability to borrow money or to consummate the transactions
contemplated by this Agreement or to perform its obligations under any Loan Document to which it is
a party.



     (r) Margin Stock. Neither the Borrower, any Subsidiary nor any other Loan Party is
engaged principally, or as one of its important activities, in the business of extending credit for
the purpose, whether immediate, incidental or ultimate, of buying or carrying “margin stock” within
the meaning of Regulation U of the Board of Governors of the Federal Reserve System.



     (s) Affiliate Transactions. Except as permitted by Section 10.10., neither the
Borrower, any Subsidiary nor any other Loan Party is a party to any transaction with an Affiliate.



     (t) Intellectual Property. Each of the Borrower, each other Loan Party and each other
Subsidiary owns or has the right to use, under valid license agreements or otherwise, all material
patents, licenses, franchises, trademarks, trademark rights, service marks, service mark rights,
trade names, trade name rights, trade secrets and copyrights (collectively, “Intellectual
Property”) necessary to the conduct of its businesses as now conducted and as contemplated by the
Loan Documents, without known conflict with any patent, license, franchise, trademark, trademark
right, service mark, service mark right, trade secret, trade name, copyright or other proprietary
right of any other Person. The Borrower, each other Loan Party and each other Subsidiary have
taken all such steps as they deem reasonably necessary to protect their respective rights under and
with respect to such Intellectual Property. No material claim has been asserted by any Person with
respect to the use of any such Intellectual Property by the Borrower, any other Loan Party or any
other Subsidiary, or challenging or questioning the validity or effectiveness of any such
Intellectual Property. The use of such Intellectual Property by the Borrower, its Subsidiaries and
the other Loan Parties, does not infringe on the rights of any Person, subject to such claims and
infringements as do not, in the aggregate, give rise to any liabilities on the part of the
Borrower, any other Loan Party or any other Subsidiary that could reasonably be expected to have a
Material Adverse Effect.



     (u) Business. As of the Agreement Date, the Borrower and its Subsidiaries are engaged
in the business of buying and managing predominantly office properties primarily leased to the
federal government of the United States, together with other business activities incidental
thereto.



     (v) Broker’s Fees. No broker’s or finder’s fee, commission or similar compensation
will be payable to any third party with respect to the transactions contemplated hereby. No other
similar fees or commissions will be payable by any Loan Party to any third party for any other
services rendered to the Borrower or any of its Subsidiaries ancillary to the transactions
contemplated hereby.



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     (w) Accuracy and Completeness of Information. No written information, report or other
papers or data (excluding financial projections and other forward looking statements) furnished to
the Agent or any Lender by, on behalf of, or at the direction of, the Borrower, any Subsidiary or
any other Loan Party in connection with, pursuant to or relating in any way to this Agreement, when
considered with all such information, reports, papers and data, contained any untrue statement of a
fact material to the creditworthiness of the Borrower, any Subsidiary or any other Loan Party or
omitted to state a material fact necessary in order to make such statements contained therein, in
light of the circumstances under which they were made, not misleading. All financial statements
(including in each case all related schedules and notes) furnished to the Agent or any Lender by,
on behalf of, or at the direction of, the Borrower, any Subsidiary or any other Loan Party in
connection with, pursuant to or relating in any way to this Agreement, present fairly, in all
material respects and in accordance with GAAP consistently applied throughout the periods involved,
the financial position of the Persons involved as at the date thereof and the results of operations
for such periods (subject, as to interim statements, to changes resulting from normal year-end
audit adjustments). All financial projections and other forward looking statements prepared by or
on behalf of the Borrower, any Subsidiary or any other Loan Party that have been or may hereafter
be made available to the Agent or any Lender were or will be prepared in good faith based on
reasonable assumptions. As of the Agreement Date, no fact is known to the Borrower which has had,
or may in the future have (so far as the Borrower can reasonably foresee), a Material Adverse
Effect which has not been set forth in the financial statements referred to in Section 7.1.(k) or
in such information, reports or other papers or data or otherwise disclosed in writing to the Agent
and the Lenders. The Agent and the Lenders (x) acknowledge that projections and other
forward-looking information are subject to risks that could cause the actual results to be
materially different due to: (i) general economic and business conditions; (ii) shortages or price
changes in raw materials, or labor shortages or unrest among key trades; (iii) land availability;
(iv) weather conditions, natural disasters or similar environmental events; (v) debt level of the
Borrower; (vi) terrorist activities and other acts of war; (viii) governmental regulation; (ix)
competition; and (x) unanticipated violations of the Borrower’s policy, legal proceedings or claims
or other events outside of the Borrower’s reasonable control and (y) agree the same shall not be
considered a representation or warranty of the Borrower as the information may be incomplete or out
of date as a result of such risks.



     (x) REIT Status. The Borrower qualifies as a REIT and is in compliance with all
requirements and conditions imposed under the Internal Revenue Code to allow the Borrower to
maintain its status as a REIT.



     (y) Foreign Assets Control. None of the Borrower, any Subsidiary or any Affiliate of
the Borrower: (i) is a Sanctioned Person, (ii) has any of its assets in Sanctioned Entities, or
(iii) derives any of its operating income from investments in, or transactions with, Sanctioned
Persons or Sanctioned Entities.



Section 7.2. Survival of Representations and Warranties, Etc.




     All statements contained in any certificate, financial statement or other instrument delivered
by or on behalf of the Borrower, any Subsidiary or any other Loan Party to the Agent or any Lender
pursuant to or in connection with this Agreement or any of the other Loan



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Documents (including, but not limited to, any such statement made in or in connection with any
amendment hereto or thereto or any statement contained in any certificate, financial statement or
other instrument delivered by or on behalf of the Borrower prior to the Agreement Date and
delivered to the Agent or any Lender in connection with the underwriting or closing of the
transactions contemplated hereby) shall constitute representations and warranties made by the
Borrower in favor of the Agent or any of the Lenders under this Agreement. All representations and
warranties made under this Agreement and the other Loan Documents shall be deemed to be made at and
as of the Agreement Date, the date on which any extension of the Termination Date is effectuated
pursuant to Section 2.12. and the date of the occurrence of any Credit Event, except to the extent
that such representations and warranties expressly relate solely to an earlier date (in which case
such representations and warranties shall have been true and correct in all material respects on
and as of such earlier date) and except for changes in factual circumstances not prohibited under
the Loan Documents. All such representations and warranties shall survive the effectiveness of
this Agreement, the execution and delivery of the Loan Documents and the making of the Loans and
the issuance of the Letters of Credit.



Article VIII. Affirmative Covenants




     For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required
pursuant to Section 13.6., all of the Lenders) shall otherwise consent in the manner provided for
in Section 13.6., the Borrower shall comply with the following covenants:



Section 8.1. Preservation of Existence and Similar Matters.




     Except as otherwise permitted under Section 10.6., the Borrower shall, and shall cause each
Subsidiary and each other Loan Party to, preserve and maintain its respective existence, rights,
franchises, licenses and privileges in the jurisdiction of its incorporation or formation and
qualify and remain qualified and authorized to do business in each jurisdiction in which the
character of its properties or the nature of its business requires such qualification and
authorization and where the failure to be so authorized and qualified could reasonably be expected
to have a Material Adverse Effect.



Section 8.2. Compliance with Applicable Law and Material Contracts.




     The Borrower shall, and shall cause each Subsidiary and each other Loan Party to, comply with
(a) all Applicable Laws, including the obtaining of all Governmental Approvals, the failure with
which to comply could reasonably be expected to have a Material Adverse Effect, and (b) all terms
and conditions of all Material Contracts to which it is a party the breach of which would give any
other party to such Material Contract the right to terminate it.



Section 8.3. Maintenance of Property.




     In addition to the requirements of any of the other Loan Documents, the Borrower shall, and
shall cause each Subsidiary and other Loan Party to, protect and preserve all of its respective
material properties, including, but not limited to, all Intellectual Property, and maintain in good
repair, working order and condition all tangible properties, ordinary wear and tear excepted.




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Section 8.4. Conduct of Business.




     The Borrower shall, and shall cause its Subsidiaries and the other Loan Parties to, carry on,
their respective businesses as described in Section 7.1.(u).



Section 8.5. Insurance.




     In addition to the requirements of any of the other Loan Documents, the Borrower shall, and
shall cause each Subsidiary and other Loan Party to, maintain insurance (on a replacement cost
basis) with financially sound and reputable insurance companies against such risks and in such
amounts as is customarily maintained by Persons engaged in similar businesses or as may be required
by Applicable Law, and from time to time deliver to the Agent upon its written request a detailed
list, together with copies of all policies of the insurance then in effect, stating the names of
the insurance companies, the amounts and rates of the insurance, the dates of the expiration
thereof and the properties and risks covered thereby.



Section 8.6. Payment of Taxes and Claims.




     The Borrower shall, and shall cause each Subsidiary and other Loan Party to, pay and discharge
when due (a) all taxes, assessments and governmental charges or levies imposed upon it or upon its
income or profits or upon any properties belonging to it, and (b) all lawful claims of materialmen,
mechanics, carriers, warehousemen and landlords for labor, materials, supplies and rentals which,
if unpaid, might become a Lien on any properties of such Person; provided, however, that this
Section shall not require the payment or discharge of any such tax, assessment, charge, levy or
claim which (i) is being contested in good faith by appropriate proceedings which operate to
suspend the collection thereof and for which adequate reserves have been established on the books
of the Borrower, such Subsidiary or such other Loan Party, as applicable, in accordance with GAAP
or (ii) in the case of any Lien described in the immediately preceding clause (b), which has been
bonded off to the satisfaction of the Agent.



Section 8.7. Visits and Inspections.




     The Borrower shall, and shall cause each Subsidiary and other Loan Party to, permit
representatives or agents of any Lender or the Agent, from time to time after reasonable prior
notice if no Event of Default shall be in existence, as often as may be reasonably requested, but
only during normal business hours and at the expense of such Lender or the Agent (unless a Default
or Event of Default shall exist, in which case the exercise by the Agent or such Lender of its
rights under this Section shall be at the expense of the Borrower), as the case may be, to: (a)
visit and inspect all properties of the Borrower or such Subsidiary or other Loan Party to the
extent any such right to visit or inspect is within the control of such Person; (b) inspect and
make extracts from their respective books and records, including but not limited to management
letters prepared by independent accountants; and (c) discuss with its officers and employees, and
its independent accountants, its business, properties, condition (financial or otherwise), results
of operations and performance. If requested by the Agent, the Borrower shall execute an
authorization letter addressed to its accountants authorizing the Agent or any Lender to discuss
the financial affairs of the Borrower and any Subsidiary or any other Loan Party with its
accountants.



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Section 8.8. Use of Proceeds; Letters of Credit.




     The Borrower shall use the proceeds of the Loans and the Letters of Credit for general
corporate purposes only, including without limitation, to finance acquisitions consistent with this
business as described in Section 7.1.(u). No part of the proceeds of any Loan or Letter of Credit
will be used (a) for the purpose of buying or carrying “margin stock” within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System or to extend credit to others
for the purpose of purchasing or carrying any such margin stock or (b) fund any operations in,
finance any investments or activities in, or make any payments to, a Sanctioned Person or
Sanctioned Entity.



Section 8.9. Environmental Matters.




     The Borrower shall, and shall cause all of its Subsidiaries and the other Loan Parties to,
comply with all Environmental Laws the failure with which to comply could reasonably be expected to
have a Material Adverse Effect. If the Borrower, any Subsidiary or any other Loan Party shall (a)
receive notice that any violation of any Environmental Law may have been committed or is about to
be committed by such Person, (b) receive notice that any administrative or judicial complaint or
order has been filed or is about to be filed against the Borrower, any Subsidiary or any other Loan
Party alleging violations of any Environmental Law or requiring the Borrower, any Subsidiary or any
other Loan Party to take any action in connection with the release of Hazardous Materials or (c)
receive any notice from a Governmental Authority or private party alleging that the Borrower, any
Subsidiary or any other Loan Party may be liable or responsible for costs associated with a
response to or cleanup of a release of Hazardous Materials or any damages caused thereby, and the
matters referred to in such notices, individually or in the aggregate, could reasonably be expected
to have a Material Adverse Effect, the Borrower shall provide the Agent with a copy of such notice
promptly, and in any event within 10 Business Days, after the receipt thereof by the Borrower, any
Subsidiary or any other Loan Party. The Borrower shall, and shall cause its Subsidiaries and the
other Loan Parties to, take promptly all actions necessary to prevent the imposition of any Liens
on any of their respective properties arising out of or related to any Environmental Laws.



Section 8.10. Books and Records.




     The Borrower shall, and shall cause each of its Subsidiaries and the other Loan Parties to,
maintain books and records pertaining to its respective business operations in such detail, form
and scope as is consistent with good business practice and in accordance with GAAP.



Section 8.11. Further Assurances.




     The Borrower shall, at the Borrower’s cost and expense and upon request of the Agent, execute
and deliver or cause to be executed and delivered, to the Agent such further instruments, documents
and certificates, and do and cause to be done such further acts that may be reasonably necessary or
advisable in the reasonable opinion of the Agent to carry out more effectively the provisions and
purposes of this Agreement and the other Loan Documents.



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Section 8.12. New Subsidiaries/Guarantors.




     (a) Requirement to Become Guarantor. Within 10 days of any Person (other than an
Excluded Subsidiary) becoming a Material Subsidiary after the Agreement Date, the Borrower shall
deliver to the Agent each of the following items, each in form and substance reasonably
satisfactory to the Agent: (i) an Accession Agreement executed by such Material Subsidiary and (ii)
the items that would have been delivered under Sections 6.1.(a)(iv) through (viii) and (xviii) if
such Material Subsidiary had been one on the Agreement Date; provided, however, promptly (and in
any event within 10 days) upon any Excluded Subsidiary ceasing to be subject to the restriction
which prevented it from becoming a Guarantor on the Agreement Date or delivering an Accession
Agreement pursuant to this Section, as the case may be, such Subsidiary shall comply with the
provisions of this Section. The Borrower shall send to each Lender copies of each of the foregoing
items once the Agent has received all such items with respect to a Material Subsidiary.



     (b) Release of a Guarantor. The Borrower may request in writing that the Agent
release, and upon receipt of such request the Agent shall release, a Guarantor from the Guaranty so
long as: (i) such Guarantor (x) qualifies, or will qualify simultaneously with its release from the
Guaranty, as an Excluded Subsidiary or (y) has ceased to be, or simultaneously with its release
from the Guaranty will cease to be, a Subsidiary or a Material Subsidiary; (ii) such Guarantor will
not own or lease any Collateral Property; (iii) no Default or Event of Default shall then be in
existence or would occur as a result of such release, including without limitation, a Default or
Event of Default resulting from a violation of any of the covenants contained in Section 10.1.;
(iv) the representations and warranties made or deemed made by the Borrower and each other Loan
Party in the Loan Documents to which any of them is a party, shall be true and correct in all
material respects on and as of the date of such extension with the same force and effect as if made
on and as of such date except to the extent that such representations and warranties expressly
relate solely to an earlier date (in which case such representations and warranties shall have been
true and correct in all material respects on and as of such earlier date) and except for changes in
factual circumstances not prohibited under the Loan Documents; and (v) the Agent shall have
received such written request at least 10 Business Days prior to the requested date of release.
Delivery by the Borrower to the Agent of any such request shall constitute a representation by the
Borrower that the matters set forth in the preceding sentence (both as of the date of the giving of
such request and as of the date of the effectiveness of such request) are true and correct with
respect to such request.



Section 8.13. REIT Status.




     The Borrower shall at all times maintain its status as a REIT.



Section 8.14. Exchange Listing.




     The Borrower shall maintain at least one class of common shares of the Borrower having trading
privileges on the New York Stock Exchange or the American Stock Exchange or which is the subject of
price quotations in the over-the-counter market as reported by the National Association of
Securities Dealers Automated Quotation System.



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Article IX. Information




     For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required
pursuant to Section 13.6., all of the Lenders) shall otherwise consent in the manner set forth in
Section 13.6., the Borrower shall furnish to each Lender (or to the Agent if so provided below) at
its Lending Office:



Section 9.1. Quarterly Financial Statements.




     As soon as available and in any event within 5 days after the same is required to be filed
with the Securities and Exchange Commission (but in no event later than 50 days after the end of
each of the first, second and third fiscal quarters of the Borrower), the unaudited consolidated
balance sheet of the Borrower and its Subsidiaries as at the end of such period and the related
unaudited consolidated statements of income, shareholders’ equity and cash flows of the Borrower
and its Subsidiaries for such period, setting forth in each case in comparative form the figures as
of the end of and for the corresponding periods of the previous fiscal year, all of which shall be
in form and substance satisfactory to the Agent and shall be certified by the chief executive
officer or chief financial officer of the Borrower, in his or her opinion, to present fairly, in
accordance with GAAP and in all material respects, the consolidated financial position of the
Borrower and its Subsidiaries as at the date thereof and the results of operations for such period
(subject to normal year-end audit adjustments).



Section 9.2. Year-End Statements.




     As soon as available and in any event within 5 days after the same is required to be filed
with the Securities and Exchange Commission (but in no event later than 95 days after the end of
each fiscal year of the Borrower), the audited consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such fiscal year and the related audited consolidated statements of
income, shareholders’ equity and cash flows of the Borrower and its Subsidiaries for such fiscal
year, setting forth in comparative form the figures as at the end of and for the previous fiscal
year, all of which shall be (a) in form and substance satisfactory to Agent, (b) certified by the
chief executive officer or chief financial officer of the Borrower, in his or her opinion, to
present fairly, in accordance with GAAP and in all material respects, the consolidated financial
position of the Borrower and its Subsidiaries as at the date thereof and the results of operations
for such period and (c) accompanied by the report thereon of independent certified public
accountants of recognized national standing acceptable to the Agent, whose certificate shall be
unqualified and in scope and substance satisfactory to the Requisite Lenders and who shall have
authorized the Borrower to deliver such financial statements and report to the Agent and the
Lenders.



Section 9.3. Compliance Certificate.




     At the time financial statements are furnished pursuant to Sections 9.1. and 9.2., and within
10 Business Days of the Agent’s reasonable request with respect to any other fiscal period, a
certificate substantially in the form of Exhibit I (a “Compliance Certificate”) executed by the
chief financial officer or chief accounting officer of the Borrower: (a) setting forth in
reasonable detail as at the end of such quarterly accounting period, fiscal year, or other fiscal
period, as the case may be, the calculations required to establish whether or not the Borrower



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was
in compliance with the covenants contained in Sections 10.1. and 10.2. and (b) stating that, to the
best of his or her knowledge, information and belief after due inquiry, no Default or Event of
Default exists, or, if such is not the case, specifying such Default or Event of Default and its
nature, when it occurred, whether it is continuing and the steps being taken by the Borrower with
respect to such event, condition or failure.




Section 9.4. Other Information.




     (a) Management Reports. Promptly upon receipt thereof, copies of all management
reports, if any, submitted to the Borrower or its Board of Directors by its independent public
accountants in connection with any annual or special audit preformed by such accountants;



     (b) Securities Filings. Prompt notice of the filing of all registration statements
(excluding any registration statements on Form S-8 or its equivalent), reports on Forms 10-K, 10-Q
and 8-K (or their equivalents) and all other periodic reports which the Borrower, any Subsidiary or
any other Loan Party shall file with the Securities and Exchange Commission (or any Governmental
Authority substituted therefor) or any national securities exchange (such registration statements,
reports and other periodic reports referred to a “Securities Filing”), and copies of any of the
foregoing that is not publicly available to the Agent and the Lenders;



     (c) Shareholder Information; Press Releases. Promptly upon the mailing thereof to the
shareholders of the Borrower generally, copies of all financial statements, reports and proxy
statements so mailed and promptly upon the issuance thereof copies of all press releases issued by
the Borrower, any Subsidiary or any other Loan Party (but only to the extent such financial
statements, reports and proxy statements are not publicly available to the Agent and the Lenders in
a Securities Filing);



     (d) ERISA. If and when any member of the ERISA Group (i) gives or is required to give
notice to the PBGC of any “reportable event” (as defined in Section 4043 of ERISA) with respect to
any Plan which might constitute grounds for a termination of such Plan under Title IV of ERISA, or
knows that the plan administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or required to be given to
the PBGC; (ii) receives notice of complete or partial withdrawal liability under Title IV of ERISA
or notice that any Multiemployer Plan is in reorganization, is insolvent or has been terminated, a
copy of such notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent to
terminate, impose liability (other than for premiums under Section 4007 of ERISA) in respect of, or
appoint a trustee to administer any Plan, a copy of such notice; (iv) applies for a waiver of the
minimum funding standard under Section 412 of the Internal Revenue Code, a copy of such
application; (v) gives notice of intent to terminate any Plan under Section 4041(c) of ERISA, a
copy of such notice and other information filed with the PBGC; (vi) gives notice of withdrawal from
any Plan pursuant to Section 4063 of ERISA, a copy of such notice; or (vii) fails to make any
payment or contribution to any Plan or Multiemployer Plan or in respect of any Benefit Arrangement
or makes any amendment to any Plan or Benefit Arrangement, and of which has resulted or could
reasonably be expected to result in the imposition of a Lien or the posting of a bond or other
security, a certificate of the chief executive officer or chief financial officer of the Borrower
setting forth details as to such occurrence and



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the action, if any, which the Borrower or
applicable member of the ERISA Group is required or proposes to take;




     (e) Litigation. To the extent the Borrower or any Subsidiary is aware of the same,
prompt notice of the commencement of any proceeding or investigation by or before any Governmental
Authority and any action or proceeding in any court or other tribunal or before any arbitrator
against or in any other way relating adversely to, or adversely affecting, the Borrower or any
Subsidiary or any of their respective properties, assets or businesses which could reasonably be
expected to have a Material Adverse Effect, and prompt notice of the receipt of notice that any
United States income tax returns of the Borrower or any of its Subsidiaries are being audited;



     (f) Change of Management or Financial Condition. Prompt notice of any change in the
senior management of the Borrower, any Subsidiary or any other Loan Party and any change in the
business, assets, liabilities, financial condition, results of operations or business prospects of
the Borrower, any Subsidiary or any other Loan Party which has had or could reasonably be expected
to have a Material Adverse Effect;



     (g) Default. Notice of the occurrence of any of the following promptly upon a
Responsible Officer of the Borrower obtaining knowledge thereof: (i) any Default or Event of
Default or (ii) any event which constitutes or which with the passage of time, the giving of
notice, or otherwise, would constitute a default or event of default by the Borrower, any
Subsidiary or any other Loan Party under any Material Contract to which any such Person is a party
or by which any such Person or any of its respective properties may be bound;



     (h) Borrowing Base Certificate. As soon as available and in any event within 50 days
after the end of each fiscal quarter of the Borrower (or within 95 days after the end of the last
fiscal quarter of the Borrower’s fiscal year), a Borrowing Base Certificate setting forth the
information to be contained therein as of the last day of such fiscal quarter;



     (i) Quarterly Operating Summaries. At the time financial statements are furnished
pursuant to Sections 9.1. and 9.2., an operating summary with respect to each Collateral Property
for the fiscal quarter most recently ended, including without limitation, a quarterly and
year-to-date statement of total revenues, expenses, net operating income and an occupancy status
report together with a current rent roll for each such Property;



     (j) Statement of FFO. At the time financial statements are furnished pursuant to
Sections 9.1. and 9.2., a statement of Funds From Operations for the period of four consecutive
fiscal quarters most recently ended;



     (k) Judgments. Prompt notice of any order, judgment or decree in excess of $5,000,000
having been entered against the Borrower, any Subsidiary or any other Loan Party or any of their
respective properties or assets;



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     (l) Patriot Act Information. From time to time and promptly upon each request,
information identifying the Borrower as a Lender may request in order to comply with the USA
Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001));



     (m) Liabilities of NY Owners. Upon the total liabilities of a NY Owner (exclusive of
(i) liabilities secured by the Security Documents and (ii) liabilities which by their terms are
subordinate to the obligations of such NY Owner under the Guaranty and the other Loan Documents to
which it is a party) exceeding $500,000, notice of such occurrence withing 5 days thereof; and



     (o) Other Information. From time to time and promptly upon each request, such data,
certificates, reports, statements, opinions of counsel, documents or further information regarding
the business, assets, liabilities, financial condition, results of operations or business prospects
of the Borrower or any of its Subsidiaries as the Agent or any Lender may reasonably request.



Section 9.5. Electronic Delivery.




     Documents required to be delivered pursuant to Section 9.1., 9.2. or 9.4.(b) (to the extent
any such documents are included in a Securities Filing) may be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (a) on which the Borrower posts such
documents, or provides a link thereto, on the Borrower’s website; or (b) on which such documents
are posted on the Borrower’s behalf on an internet or intranet website, if any, to which each
Lender and the Agent have access (whether a commercial, third-party website or whether sponsored by
the Agent); provided that: (i) the Borrower shall deliver paper copies of such documents to
the Agent or any Lender that requests the Borrower to deliver such paper copies until a written
request to cease delivering paper copies is given by the Agent or such Lender and (ii) the Borrower
shall notify the Agent and each Lender of the posting of any such documents and provide to the
Agent by electronic mail electronic versions of such documents. Any document required to be
delivered pursuant to any of the other provisions of this Article IX. which is suitable for
delivery in electronic format, may be delivered to the Agent in such format pursuant to procedures
approved by the Agent and if so delivered, shall be deemed to have been delivered on the date such
document is delivered to the Agent pursuant to such procedures; provided that the Borrower
shall deliver paper copies of any such document to the Agent upon the Agent’s request. Promptly
upon the Agent’s receipt of any such document, the Agent shall forward a copy thereof, in the form
received, to each Lender pursuant to procedures approved by the Agent. Notwithstanding anything
contained herein, in every instance the Borrower shall be required to provide paper copies of the
certificate required by Section 9.3. to the Agent. The Agent shall have no obligation to any of
the other parties hereto to request the delivery of, or to maintain copies of, the documents
referred to above.



Article X. Negative Covenants




     For so long as this Agreement is in effect, unless the Requisite Lenders (or, if required
pursuant to Section 13.6., all of the Lenders) shall otherwise consent in the manner set forth in
Section 13.6., the Borrower shall comply with the following covenants:



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Section 10.1. Financial Covenants.




     The Borrower shall not permit:



     (a) Maximum Leverage Ratio. The ratio of (i) Total Indebtedness to (ii) Total Asset
Value, to exceed 0.75 to 1.00 at any time.



     (b) Minimum Fixed Charge Coverage Ratio. The ratio of (i) Adjusted EBITDA for the
period of two consecutive fiscal quarters of the Borrower most recently ending to (ii) Fixed
Charges for such period, to be less than 1.25 to 1.00 at any time.



     (c) Minimum Tangible Net Worth. Tangible Net Worth at any time to be less than (i)
$140,000,000 plus (ii) 75% of the Net Proceeds of all Equity Issuances effected by the
Borrower or any Subsidiary after June 30, 2005 (other than Equity Issuances to the Borrower or any
Subsidiary).



     (d) Floating Rate Indebtedness. The ratio of (i) Floating Rate Indebtedness of the
Borrower and its Subsidiaries determined on a consolidated basis to (ii) Total Indebtedness, to
exceed 25% to 1.00 at any time.



     (e) Maximum Secured Indebtedness Ratio. The ratio of (i) Secured Recourse
Indebtedness of the Borrower and its Subsidiaries determined on a consolidated basis to (ii) Total
Asset Value, to exceed 0.10 to 1.00 at any time.



Section 10.2. Restricted Payments.




     The Borrower shall not, and shall not permit any of its Subsidiaries to, declare or make any
Restricted Payment; provided, however, that the Borrower and its Subsidiaries may declare and make
the following Restricted Payments so long as no Default or Event of Default would result therefrom:



     (a) the Borrower may declare and pay quarterly cash dividends to its shareholders in an amount
not to exceed (i) for each fiscal quarter ending on or before December 31, 2006, 100% of Cash
Available for Distribution for such fiscal quarter plus $3,000,000, (ii) for the fiscal quarter
ending on March 31, 2007, 95% of Cash Available for Distribution for such fiscal quarter and (iii)
for any period of two fiscal quarters ending after March 31, 2007, 95% of Cash Available for
Distribution for such two fiscal quarters; provided, that (x) for any fiscal quarter ending on or
before December 31, 2006, if Cash Available for Distribution for such fiscal quarter plus
$3,000,000 exceeded the amount of cash dividends paid and declared for such fiscal quarter, then
the Borrower may add such excess to the amount of cash dividends the Borrower may declare and pay
for any subsequent fiscal quarter ending on or before December 31, 2006; (y) nothing in this
subsection (a) is intended to prohibit the Borrower from declaring and paying dividends with
respect to a fiscal period in a subsequent fiscal period; and (z) in any event, the Borrower may
declare and pay dividends in the amount required in order for the Borrower to remain in compliance
with Section 8.13. [REIT Status];



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     (b) the Borrower may make cash distributions to its shareholders of capital gains resulting
from gains from certain asset sales to the extent necessary to avoid payment of taxes on such
asset sales imposed under Sections 857(b)(3) and 4981 of the Internal Revenue Code;



     (c) a Subsidiary that is not a Wholly Owned Subsidiary may make cash distributions to holders
of Equity Interests issued by such Subsidiary so long as such distributions are made pro rata in
accordance with the proportion of Equity Interests held by such holders; and



     (d) Subsidiaries may pay Restricted Payments to the Borrower or any other Subsidiary.


Notwithstanding the foregoing, but subject to the following sentence, if a Default or Event of
Default exists, the Borrower may only declare or make cash distributions to its shareholders during
any fiscal year in an aggregate amount not to exceed the minimum amount necessary for the Borrower
to remain in compliance with Section 8.13. If a Default or Event of Default specified in Section
11.1.(a), Section 11.1.(b), Section 11.1.(f) or Section 11.1.(g) shall exist, or if as a result of
the occurrence of any other Event of Default any of the Obligations have been accelerated pursuant
to Section 11.2.(a), the Borrower shall not, and shall not permit any Subsidiary to, make any
Restricted Payments to any Person other than to the Borrower or any Subsidiary.




Section 10.3. Indebtedness.




     The Borrower shall not, and shall not permit any Subsidiary or any other Loan Party to, incur,
assume, or otherwise become obligated in respect of any Indebtedness after the Agreement Date if
immediately prior to the assumption, incurring or becoming obligated in respect thereof, or
immediately thereafter and after giving effect thereto, a Default or Event of Default is or would
be in existence, including without limitation, a Default or Event of Default resulting from a
violation of any of the covenants contained in Section 10.1.



Section 10.4. Investments.




     The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to, directly
or indirectly, acquire, make or purchase any Investment, or permit any Investment of such Person to
be outstanding on and after the Agreement Date, other than the following:



     (a) Investments in Subsidiaries in existence on the Agreement Date and disclosed on Part I of
Schedule 7.1.(b);



     (b) Investments to acquire Equity Interests of a Subsidiary or any other Person who after
giving effect to such acquisition would be a Subsidiary, so long as in each case immediately prior
to such Investment, and after giving effect thereto, no Default or Event of Default is or would be
in existence;



     (c) Investments in cash and Cash Equivalents;



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     (d) intercompany Indebtedness among the Borrower and its Wholly Owned Subsidiaries provided
that such Indebtedness is permitted by the terms of Section 10.3.;



     (e) loans and advances to officers and employees for moving, entertainment, travel and other
similar expenses in the ordinary course of business consistent with past practices; and



     (f) any other Investment so long as immediately prior to making such Investment, and
immediately thereafter and after giving effect thereto, no Default or Event of Default is or would
be in existence.



Section 10.5. Liens; Negative Pledges; Other Matters.




     (a) The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to,
create, assume, or incur any Lien (other than Permitted Liens) upon any of its properties, assets,
income or profits of any character whether now owned or hereafter acquired if immediately prior to
the creation, assumption or incurring of such Lien, or immediately thereafter, a Default or Event
of Default is or would be in existence, including without limitation, a Default or Event of Default
resulting from a violation of any of the covenants contained in Section 10.1.



     (b) The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to, enter
into, assume or otherwise be bound by any Negative Pledge except for a Negative Pledge contained in
(i) an agreement (x) evidencing Indebtedness which the Borrower or such Subsidiary may create,
incur, assume, or permit or suffer to exist under Section 10.3., (y) which Indebtedness is secured
by a Lien permitted to exist under the Loan Documents, and (z) which prohibits the creation of any
other Lien on only the property securing such Indebtedness as of the date such agreement was
entered into; or (ii) in an agreement relating to the sale of a Subsidiary or assets pending such
sale, provided that in any such case the Negative Pledge applies only to the Subsidiary or the
assets that are the subject of such sale.



     (c) The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to, create
or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction
of any kind on the ability of any Subsidiary (other than an Excluded Subsidiary) to: (i) pay
dividends or make any other distribution on any of such Subsidiary’s capital stock or other equity
interests owned by the Borrower or any Subsidiary; (ii) pay any Indebtedness owed to the Borrower
or any Subsidiary; (iii) make loans or advances to the Borrower or any Subsidiary; or (iv) transfer
any of its property or assets to the Borrower or any Subsidiary.



Section 10.6. Merger, Consolidation, Sales of Assets and Other Arrangements.




     The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to: (i) enter
into any transaction of merger or consolidation; (ii) liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution); or (iii) convey, sell, lease, sublease, transfer or
otherwise dispose of, in one transaction or a series of transactions, all or substantially all of
its business or assets, whether now owned or hereafter acquired; provided, however, that:



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     (a) any of the actions described in the immediately preceding clauses (i) through (iii) may be
taken with respect to any Subsidiary so long as: (x) immediately prior to the taking of such
action, and immediately thereafter and after giving effect thereto, no Default or Event of Default
is or would be in existence and (y) if such action includes the disposition of a Collateral
Property (regardless of whether such disposition takes the form of a direct sale of such Collateral
Property, the sale of the Equity Interests of the Subsidiary that owns such Collateral Property or
a merger of such Subsidiary), such Collateral Property can and will be released in accordance with
Section 4.3.;



     (b) a Person may merge with a Loan Party so long as (i) the survivor of such merger is such
Loan Party or, in the case of any merger not involving the Borrower, becomes a Loan Party at the
time of such merger, (ii) immediately prior to such merger, and immediately thereafter and after
giving effect thereto, (x) no Default or Event of Default is or would be in existence and (y) the
representations and warranties made or deemed made by the Borrower and each other Loan Party in the
Loan Documents to which any of them is a party are and shall be true and correct in all material
respects, except to the extent that such representations and warranties expressly relate solely to
an earlier date (in which case such representations and warranties shall have been true and correct
in all material respects on and as of such earlier date) and except for changes in factual
circumstances not prohibited under the Loan Documents, and (iii) the Borrower shall have given the
Agent at least 30-days’ prior written notice of such merger, such notice to include a certification
as to the matters described in the immediately preceding clause (ii) (except that such prior notice
shall not be required in the case of the merger of a Subsidiary that does not own a Collateral
Property with and into a Loan Party but the Borrower shall give the Lender notice of any such
merger promptly following the effectiveness of such merger);



     (c) the Borrower and its Subsidiaries may lease and sublease their respective assets, as
lessor or sublessor (as the case may be), in the ordinary course of their business; and



     (d) the Borrower and its Subsidiaries may sell, transfer or dispose of assets among
themselves.



Section 10.7. Fiscal Year.




     The Borrower shall not change its fiscal year from that in effect as of the Agreement Date.



Section 10.8. Modifications to Material Contracts.




     The Borrower shall not, and shall not permit any Subsidiary or other Loan Party to, enter into
any amendment or modification to any Material Contract which could reasonably be expected to have a
Material Adverse Effect.



Section 10.9. Modifications of Organizational Documents.




     The Borrower shall not, and shall not permit any Loan Party or other Subsidiary to, amend,
supplement, restate or otherwise modify its articles or certificate of incorporation, by-



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laws,
operating agreement, declaration of trust, partnership agreement or other applicable organizational
document if such amendment, supplement, restatement or other modification could reasonably be
expected to have a Material Adverse Effect.




Section 10.10. Transactions with Affiliates.




     The Borrower shall not, and shall not permit any of its Subsidiaries or any other Loan Party
to, permit to exist or enter into, any transaction (including the purchase, sale, lease or exchange
of any property or the rendering of any service) with any Affiliate (other than a Loan Party),
except transactions in the ordinary course of and pursuant to the reasonable requirements of the
business of the Borrower or any of its Subsidiaries and upon fair and reasonable terms which are no
less favorable to the Borrower or such Subsidiary than would be obtained in a comparable arm’s
length transaction with a Person that is not an Affiliate.



Section 10.11. ERISA Exemptions.




     The Borrower shall not, and shall not permit any Subsidiary to, permit any of its respective
assets to become or be deemed to be “plan assets” within the meaning of ERISA, the Internal Revenue
Code and the respective regulations promulgated thereunder.



Article XI. Default




Section 11.1. Events of Default.




     Each of the following shall constitute an Event of Default, whatever the reason for such event
and whether it shall be voluntary or involuntary or be effected by operation of Applicable Law or
pursuant to any judgment or order of any Governmental Authority:



     (a) Default in Payment of Principal. The Borrower shall fail to pay when due (whether
upon demand, at maturity, by reason of acceleration or otherwise) the principal of any of the
Loans, or any Reimbursement Obligation.



     (b) Default in Payment of Interest and Other Obligations. The Borrower shall fail to
pay when due any interest on any of the Loans or any of the other payment Obligations owing by the
Borrower under this Agreement or any other Loan Document, or any other Loan Party shall fail to pay
when due any payment Obligation owing by such other Loan Party under any Loan Document to which it
is a party, and such failure shall continue for a period of 5 Business Days.



     (c) Default in Performance. (i) The Borrower shall fail to perform or observe any
term, covenant, condition or agreement contained in subsection (g) or (m) of Section 9.4. or in
Article X. or (ii) the Borrower or any other Loan Party shall fail to perform or observe any term,
covenant, condition or agreement contained in this Agreement or any other Loan Document (other than
any Security Document) to which it is a party and not otherwise mentioned in this Section and in
the case of this clause (ii) only such failure shall continue for a period of 30 days after the
earlier of (x) the date upon which a Responsible Officer of the Borrower or such other Loan Party
obtains knowledge of such failure or (y) the date upon which the Borrower has received written
notice of such failure from the Agent.



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     (d) Misrepresentations. Any written statement, representation or warranty made or
deemed made by or on behalf of the Borrower or any other Loan Party under this Agreement or under
any other Loan Document (other than any Security Document), or any amendment hereto or thereto, or
in any other writing or statement at any time furnished or made or deemed made by or on behalf of
the Borrower or any other Loan Party to the Agent or any Lender, shall at any time prove to have
been incorrect or misleading, in light of the circumstances in which made or deemed made, in any
material respect when furnished or made or deemed made.



     (e) Indebtedness Cross-Default; Derivatives Contracts.




     (i) The Borrower, any Subsidiary or any other Loan Party shall fail to pay when due and
payable, within any applicable grace or cure period, the principal of, or interest on, any
Indebtedness (other than the Loans and Reimbursement Obligations) having an aggregate
outstanding principal amount of $10,000,000 or more (or $20,000,000 or more in the case of
Nonrecourse Indebtedness) (any such Indebtedness being “Material Indebtedness”); or




     (ii) (x) the maturity of any Material Indebtedness shall have been accelerated in
accordance with the provisions of any indenture, contract or instrument evidencing,
providing for the creation of or otherwise concerning such Material Indebtedness or (y) any
Material Indebtedness shall have been required to be prepaid or repurchased prior to the
stated maturity thereof;




     (iii) any other event shall have occurred and be continuing which permits any holder or
holders of Material Indebtedness, any trustee or agent acting on behalf of such holder or
holders or any other Person, to accelerate the maturity of any such Material Indebtedness or
require any such Material Indebtedness to be prepaid or repurchased prior to its stated
maturity; or




     (iv) there occurs under any Derivatives Contract an Early Termination Date (as defined
in such Derivatives Contract) resulting from (A) any event of default under such Derivatives
Contract as to which any Loan Party is the Defaulting Party (as defined in such Derivatives
Contract) or (B) any Termination Event (as so defined) under such Derivatives Contract as to
which any Loan Party is an Affected Party (as so defined) and, in either event, the
Derivatives Termination Value owed by any Loan Party as a result thereof is $10,000,000 or
more.



     (f) Voluntary Bankruptcy Proceeding. The Borrower, any other Loan Party or any
Material Subsidiary shall: (i) commence a voluntary case under the Bankruptcy Code of 1978, as
amended, or other federal bankruptcy laws (as now or hereafter in effect); (ii) file a petition
seeking to take advantage of any other Applicable Laws, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or adjustment of debts; (iii)
consent to, or fail to contest in a timely and appropriate manner, any petition filed against it in
an involuntary case under such bankruptcy laws or other Applicable Laws or consent to any
proceeding or action described in the immediately following subsection; (iv) apply for or consent



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to, or fail to contest in a timely and appropriate manner, the appointment of, or the taking of
possession by, a receiver, custodian, trustee, or liquidator of itself or of a substantial part of
its property, domestic or foreign; (v) admit in writing its inability to pay its debts as they
become due; (vi) make a general assignment for the benefit of creditors; (vii) make a conveyance
fraudulent as to creditors under any Applicable Law; or (viii) take any corporate or partnership
action for the purpose of effecting any of the foregoing.




     (g) Involuntary Bankruptcy Proceeding. A case or other proceeding shall be commenced
against the Borrower, any other Loan Party or any Material Subsidiary in any court of competent
jurisdiction seeking: (i) relief under the Bankruptcy Code of 1978, as amended, or other federal
bankruptcy laws (as now or hereafter in effect) or under any other Applicable Laws, domestic or
foreign, relating to bankruptcy, insolvency, reorganization, winding-up, or composition or
adjustment of debts; or (ii) the appointment of a trustee, receiver, custodian, liquidator or the
like of such Person, or of all or any substantial part of the assets, domestic or foreign, of such
Person, and such case or proceeding shall continue undismissed or unstayed for a period of 60
consecutive calendar days, or an order granting the remedy or other relief requested in such case
or proceeding against the Borrower, such other Loan Party or such Material Subsidiary (including,
but not limited to, an order for relief under such Bankruptcy Code or such other federal bankruptcy
laws) shall be entered.



     (h) Litigation; Enforceability. The Borrower or any other Loan Party shall disavow,
revoke or terminate (or attempt to terminate) any Loan Document to which it is a party or shall
otherwise challenge or contest in any action, suit or proceeding in any court or before any
Governmental Authority the validity or enforceability of this Agreement, any Note or any other Loan
Document or this Agreement, any Note, the Guaranty or any other Loan Document shall cease to be in
full force and effect (except as a result of the express terms thereof).



     (i) Judgment. A judgment or order for the payment of money or for an injunction shall
be entered against the Borrower, any other Loan Party or any other Subsidiary, by any court or
other tribunal and (i) such judgment or order shall continue for a period of 30 days without being
paid, stayed or dismissed through appropriate appellate proceedings and (ii) either (A) the amount
of such judgment or order for which insurance has not been acknowledged in writing by the
applicable insurance carrier (or the amount as to which the insurer has denied liability) exceeds,
individually or together with all other such outstanding judgments or orders entered against (1)
the Borrower, the other Loan Parties, $10,000,000 or (2) Subsidiaries that are not Guarantors,
$20,000,000 or (B) in the case of an injunction or other non-monetary judgment, such judgment could
reasonably be expected to have a Material Adverse Effect.



     (j) Attachment. A warrant, writ of attachment, execution or similar process shall be
issued against any property of the Borrower, any other Loan Party or any other Subsidiary which
exceeds, individually or together with all other such warrants, writs, executions and processes,
(1) $10,000,000 in amount in the case of the Borrower and the other Loan Parties and (2)
$20,000,000 in amount in the case of Subsidiaries that are not Guarantors, and such warrant, writ,
execution or process shall not be discharged, vacated, stayed or bonded for a period of 30 days;
provided, however, that if a bond has been issued in favor of the claimant or other Person
obtaining such warrant, writ, execution or process, the issuer of such bond shall execute a waiver



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or subordination agreement in form and substance satisfactory to the Agent pursuant to which the
issuer of such bond subordinates its right of reimbursement, contribution or subrogation to the
Obligations and waives or subordinates any Lien it may have on the assets of any Loan Party.




     (k) ERISA. Any member of the ERISA Group shall fail to pay when due an amount or
amounts aggregating in excess of $10,000,000 which it shall have become liable to pay under Title
IV of ERISA; or notice of intent to terminate a Plan or Plans having aggregate Unfunded Liabilities
in excess of $10,000,000 shall be filed under Title IV of ERISA by any member of the ERISA Group,
any plan administrator or any combination of the foregoing; or the PBGC shall institute proceedings
under Title IV of ERISA to terminate, to impose liability (other than for premiums under Section
4007 of ERISA) in respect of, or to cause a trustee to be appointed to administer, any Plan or
Plans having aggregate Unfunded Liabilities in excess of $10,000,000; or a condition shall exist by
reason of which the PBGC would be entitled to obtain a decree adjudicating that any such Plan must
be terminated; or there shall occur a complete or partial withdrawal from, or a default, within the
meaning of Section 4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
could cause one or more members of the ERISA Group to incur a current payment obligation in excess
of $10,000,000.



     (l) Loan Documents. An Event of Default (as defined therein) shall occur under any of
the other Loan Documents (other than any Security Document).



     (m) Change of Control/Change in Management.




     (i) Any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”)), is or becomes the
“beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that
a Person will be deemed to have “beneficial ownership” of all securities that such Person
has the right to acquire, whether such right is exercisable immediately or only after the
passage of time), directly or indirectly, of more than 20.0% of the total voting power of
the then outstanding voting stock of the Borrower; or




     (ii) During any period of 12 consecutive months ending after the Agreement Date,
individuals who at the beginning of any such 12-month period constituted the Board of
Directors of the Borrower (together with any new directors whose election by such Board or
whose nomination for election by the shareholders of the Borrower was approved by a vote of
a majority of the directors then still in office who were either directors at the beginning
of such period or whose election or nomination for election was previously so approved)
cease for any reason to constitute a majority of the Board of Directors of the Borrower then
in office.



Section 11.2. Remedies Upon Event of Default.




     Upon the occurrence of an Event of Default the following provisions shall apply:



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     (a) Acceleration; Termination of Facilities.




     (i) Automatic. Upon the occurrence of an Event of Default specified in Section
11.1.(f) or 11.1.(g), (A)(i) the principal of, and all accrued interest on, the Loans and
the Notes at the time outstanding, (ii) an amount equal to the Stated Amount of all Letters
of Credit outstanding as of the date of the occurrence of such Event of Default for deposit
into the Collateral Account pursuant to Section 11.5. and (iii) all of the other Obligations
of the Borrower, including, but not limited to, the other amounts owed to the Lenders, the
Swingline Lender and the Agent under this Agreement, the Notes or any of the other Loan
Documents shall become immediately and automatically due and payable by the Borrower without
presentment, demand, protest, or other notice of any kind, all of which are expressly waived
by the Borrower and (B) all of the Commitments, the obligation of the Lenders to make
Revolving Loans, the Swingline Commitment, the obligation of the Swingline Lender to make
Swingline Loans, and the obligation of the Agent to issue Letters of Credit hereunder, shall
all immediately and automatically terminate.




     (ii) Optional. If any other Event of Default shall exist, the Agent shall, at
the direction of the Requisite Lenders: (A) declare (1) the principal of, and accrued
interest on, the Loans and the Notes at the time outstanding, (2) an amount equal to the
Stated Amount of all Letters of Credit outstanding as of the date of the occurrence of such
other Event of Default for deposit into the Collateral Account pursuant to Section 11.5. and
(3) all of the other Obligations, including, but not limited to, the other amounts owed to
the Lenders and the Agent under this Agreement, the Notes or any of the other Loan Documents
to be forthwith due and payable, whereupon the same shall immediately become due and payable
without presentment, demand, protest or other notice of any kind, all of which are expressly
waived by the Borrower and (B) terminate the Commitments, the Swingline Commitment, the
obligation of the Lenders to make Loans hereunder and the obligation of the Agent to issue
Letters of Credit hereunder.



     (b) Loan Documents. The Requisite Lenders may direct the Agent to, and the Agent if
so directed shall, exercise any and all of its rights under any and all of the other Loan
Documents.



     (c) Applicable Law. The Requisite Lenders may direct the Agent to, and the Agent if
so directed shall, exercise all other rights and remedies it may have under any Applicable Law.



     (d) Appointment of Receiver. To the extent permitted by Applicable Law, the Agent and
the Lenders shall be entitled to the appointment of a receiver for the assets and properties of the
Borrower and its Subsidiaries, without notice of any kind whatsoever and without regard to the
adequacy of any security for the Obligations or the solvency of any party bound for its payment, to
take possession of all or any portion of the business operations of the Borrower and its
Subsidiaries and to exercise such power as the court shall confer upon such receiver.



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Section 11.3. Remedies Upon Default.




     Upon the occurrence of a Default specified in Section 11.1.(g), the Commitments shall
immediately and automatically terminate.



Section 11.4. Allocation of Proceeds.




     If an Event of Default shall exist and maturity of any of the Obligations has been
accelerated, all payments received by the Agent under any of the Loan Documents, in respect of any
principal of or interest on the Obligations or any other amounts payable by the Borrower hereunder
or thereunder, shall be applied in the following order and priority:




     (a) amounts due the Agent in respect of fees and expenses due under Section 13.2.;




     (b) amounts due the Lenders in respect of fees and expenses due under Section 13.2.,
pro rata in the amount then due each Lender;




     (c) payments of interest on Swingline Loans;




     (d) payments of interest on all other Loans and Reimbursement Obligations, to be
applied for the ratable benefit of the Lenders;




     (e) payments of principal of Swingline Loans;




     (f) payments of principal of all other Loans, Reimbursement Obligations and other
Letter of Credit Liabilities and amounts then due and payable under any Derivatives Contract
between the Borrower and any Lender (or any affiliate of a Lender), to be applied for the
ratable benefit of the Lenders (and in the case of any Derivatives Contract, any affiliate
of a Lender); provided, however, to the extent that any amounts available for distribution
pursuant to this subsection are attributable to the issued but undrawn amount of an
outstanding Letter of Credit, such amounts shall be paid to the Agent for deposit into the
Collateral Account;




     (g) amounts due the Agent and the Lenders pursuant to Sections 12.8. and 13.9.;




     (h) payment of all other Obligations and other amounts due and owing by the Borrower
and the other Loan Parties under any of the Loan Documents, if any, to be applied for the
ratable benefit of the Lenders; and




     (i) any amount remaining after application as provided above, shall be paid to the
Borrower or whomever else may be legally entitled thereto.



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Section 11.5. Collateral Account.




     (a) As collateral security for the prompt payment in full when due of all Letter of Credit
Liabilities and the other Obligations, the Borrower hereby pledges and grants to the Agent, for the
ratable benefit of the Agent and the Lenders as provided herein, a security interest in all of its
right, title and interest in and to the Collateral Account and the balances from time to time in
the Collateral Account (including the investments and reinvestments therein provided for below).
The balances from time to time in the Collateral Account shall not constitute payment of any Letter
of Credit Liabilities until applied by the Agent as provided herein. Anything in this Agreement to
the contrary notwithstanding, funds held in the Collateral Account shall be subject to withdrawal
only as provided in this Section.



     (b) Amounts on deposit in the Collateral Account shall be invested and reinvested by the Agent
in such Cash Equivalents as the Agent shall determine in its sole discretion. All such investments
and reinvestments shall be held in the name of and be under the sole dominion and control of the
Agent for the ratable benefit of the Lenders. The Agent shall exercise reasonable care in the
custody and preservation of any funds held in the Collateral Account and shall be deemed to have
exercised such care if such funds are accorded treatment substantially equivalent to that which the
Agent accords other funds deposited with the Agent, it being understood that the Agent shall not
have any responsibility for taking any necessary steps to preserve rights against any parties with
respect to any funds held in the Collateral Account.



     (c) If a drawing pursuant to any Letter of Credit occurs on or prior to the expiration date of
such Letter of Credit, the Borrower and the Lenders authorize the Agent to use the monies deposited
in the Collateral Account and proceeds thereof to make payment to the beneficiary with respect to
such drawing or the payee with respect to such presentment.



     (d) If an Event of Default exists, the Requisite Lenders may, in their discretion, at any time
and from time to time, instruct the Agent to liquidate any such investments and reinvestments and
apply proceeds thereof to the Obligations in accordance with Section 11.4.



     (e) So long as no Default or Event of Default exists, and to the extent amounts on deposit in
or credited to the Collateral Account exceed the aggregate amount of the Letter of Credit
Liabilities then due and owing, the Agent shall, from time to time, at the request of the Borrower,
deliver to the Borrower within 10 Business Days after the Agent’s receipt of such request from the
Borrower, against receipt but without any recourse, warranty or representation whatsoever, such
amount of the credit balances in the Collateral Account as exceeds the aggregate amount of the
Letter of Credit Liabilities at such time.



     (f) The Borrower shall pay to the Agent from time to time such fees as the Agent normally
charges for similar services in connection with the Agent’s administration of the Collateral
Account and investments and reinvestments of funds therein.



Section 11.6. Performance by Agent.




     If the Borrower shall fail to perform any covenant, duty or agreement contained in any of the
Loan Documents, the Agent may, after notice to the Borrower, perform or attempt to perform



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such
covenant, duty or agreement on behalf of the Borrower after the expiration of any cure or grace
periods set forth herein. In such event, the Borrower shall, at the request of the Agent, promptly
pay any amount reasonably expended by the Agent in such performance or attempted performance to the
Agent, together with interest thereon at the applicable Post-Default Rate from the date of such
expenditure until paid. Notwithstanding the foregoing, neither the Agent nor any Lender shall have
any liability or responsibility whatsoever for the performance of any obligation of the Borrower
under this Agreement or any other Loan Document.




Section 11.7. Rights Cumulative.




     The rights and remedies of the Agent and the Lenders under this Agreement and each of the
other Loan Documents shall be cumulative and not exclusive of any rights or remedies which any of
them may otherwise have under Applicable Law. In exercising their respective rights and remedies
the Agent and the Lenders may be selective and no failure or delay by the Agent or any of the
Lenders in exercising any right shall operate as a waiver of it, nor shall any single or partial
exercise of any power or right preclude its other or further exercise or the exercise of any other
power or right.



Article XII. The Agent




Section 12.1. Authorization and Action.




     Each Lender hereby appoints and authorizes the Agent to take such action as contractual
representative on such Lender’s behalf and to exercise such powers under this Agreement and the
other Loan Documents as are specifically delegated to the Agent by the terms hereof and thereof,
together with such powers as are reasonably incidental thereto. Not in limitation of the
foregoing, each Lender authorizes and directs the Agent to enter into the Loan Documents for the
benefit of the Lenders. Each Lender hereby agrees that, except as otherwise set forth herein, any
action taken by the Requisite Lenders in accordance with the provisions of this Agreement or the
Loan Documents, and the exercise by the Requisite Lenders of the powers set forth herein or
therein, together with such other powers as are reasonably incidental thereto, shall be authorized
and binding upon all of the Lenders. Nothing herein shall be construed to deem the Agent a trustee
or fiduciary for any Lender or to impose on the Agent duties or obligations other than those
expressly provided for herein. At the request of a Lender, the Agent will forward to such Lender
copies or, where appropriate, originals of the documents delivered to the Agent pursuant to this
Agreement or the other Loan Documents. The Agent will also furnish to any Lender, upon the request
of such Lender, a copy of any certificate or notice furnished to the Agent by the Borrower, any
other Loan Party or any other Affiliate of the Borrower, pursuant to this Agreement or any other
Loan Document not already delivered to such Lender pursuant to the terms of this Agreement or any
such other Loan Document. As to any matters not expressly provided for by the Loan Documents
(including, without limitation, enforcement or collection of any of the Obligations), the Agent
shall not be required to exercise any discretion or take any action, but shall be required to act
or to refrain from acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Requisite Lenders (or all of the Lenders if explicitly required under
any other provision of this Agreement), and such instructions shall be binding upon all Lenders and
all holders of any of the Obligations; provided, however, that, notwithstanding anything in this
Agreement to the contrary, the Agent shall not be required



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to take any action which exposes the
Agent to personal liability or which is contrary to this Agreement or any other Loan Document or
Applicable Law. Not in limitation of the foregoing, the Agent shall not exercise any right or
remedy it or the Lenders may have under any Loan Document upon the occurrence of a Default or an
Event of Default unless the Requisite Lenders (or all of the Lenders if explicitly required under
any provision of this Agreement) have so directed the Agent to exercise such right or remedy.




Section 12.2. Agent’s Reliance, Etc.




     Notwithstanding any other provisions of this Agreement or any other Loan Documents, neither
the Agent nor any of its directors, officers, agents, employees or counsel shall be liable for any
action taken or omitted to be taken by it or them under or in connection with this Agreement or any
other Loan Document, except for its or their own gross negligence or willful misconduct as
determined by a court of competent jurisdiction in a final, non-appealable judgment. Without
limiting the generality of the foregoing, the Agent: (a) may treat the payee of any Note as the
holder thereof until the Agent receives written notice of the assignment or transfer thereof signed
by such payee and in form satisfactory to the Agent; (b) may consult with legal counsel (including
its own counsel or counsel for the Borrower or any other Loan Party), independent public
accountants and other experts selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants
or experts; (c) makes no warranty or representation to any Lender or any other Person and shall not
be responsible to any Lender or any other Person for any statements, warranties or representations
made by any Person in or in connection with this Agreement or any other Loan Document; (d) shall
not have any duty to ascertain or to inquire as to the performance or observance of any of the
terms, covenants or conditions of any of this Agreement or any other Loan Document or the
satisfaction of any conditions precedent under this Agreement or any Loan Document on the part of
the Borrower or other Persons (except for the delivery to it of any certificate or document
specifically required to be delivered to it pursuant to Section 6.1.) or inspect the property,
books or records of the Borrower or any other Person; (e) shall not be responsible to any Lender
for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of
this Agreement or any other Loan Document, any other instrument or document furnished pursuant
thereto or any collateral covered thereby or the perfection or priority of any Lien in favor of the
Agent on behalf of the Lenders in any such collateral; and (f) shall incur no liability under or in
respect of this Agreement or any other Loan Document by acting upon any notice, consent,
certificate or other instrument or writing (which may be by telephone or telecopy) believed by it
to be genuine and signed, sent or given by the proper party or parties. Unless set forth in
writing to the contrary, the making of its initial Loan by a Lender shall constitute a
certification by such Lender to the Agent and the other Lenders that the Borrower has satisfied the
conditions precedent for initial Loans set forth in Sections 6.1. and 6.2. that have not previously
been waived by the Requisite Lenders.



Section 12.3. Notice of Defaults.




     The Agent shall not be deemed to have knowledge or notice of the occurrence of a Default or
Event of Default unless the Agent has received notice from a Lender or the Borrower referring to
this Agreement, describing with reasonable specificity such Default or Event of Default and stating
that such notice is a “notice of default.” If any Lender (excluding the Lender



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which is also
serving as the Agent) becomes aware of any Default or Event of Default, it shall promptly send to
the Agent such a “notice of default.” Further, if the Agent receives such a “notice of default”,
the Agent shall give prompt notice thereof to the Lenders.




Section 12.4. Wachovia as Lender.




     Wachovia, as a Lender, shall have the same rights and powers under this Agreement and any
other Loan Document as any other Lender and may exercise the same as though it were not the Agent;
and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated, include Wachovia in
each case in its individual capacity. Wachovia and its affiliates may each accept deposits from,
maintain deposits or credit balances for, invest in, lend money to, act as trustee under indentures
of, serve as financial advisor to, and generally engage in any kind of business with, the Borrower,
any other Loan Party or any other affiliate thereof as if it were any other bank and without any
duty to account therefor to the other Lenders. Further, the Agent and any affiliate may accept
fees and other consideration from the Borrower for services in connection with this Agreement and
otherwise without having to account for the same to the other Lenders. The Lenders acknowledge
that, pursuant to such activities, Wachovia or its affiliates may receive information regarding the
Borrower, other Loan Parties, other Subsidiaries and other Affiliates (including information that
may be subject to confidentiality obligations in favor of such Person) and acknowledge that the
Agent shall be under no obligation to provide such information to them.



Section 12.5. Approvals of Lenders.




     All communications from the Agent to any Lender requesting such Lender’s determination,
consent, approval or disapproval (a) shall be given in the form of a written notice to such Lender,
(b) shall be accompanied by a description of the matter or issue as to which such determination,
approval, consent or disapproval is requested, or shall advise such Lender where information, if
any, regarding such matter or issue may be inspected, or shall otherwise describe the matter or
issue to be resolved, (c) shall include, if reasonably requested by such Lender and to the extent
not previously provided to such Lender, written materials and a summary of all oral information
provided to the Agent by the Borrower in respect of the matter or issue to be resolved, and (d)
shall include the Agent’s recommended course of action or determination in respect thereof. Each
Lender shall reply promptly, but in any event within 10 Business Days (or such lesser or greater
period as may be specifically required under the Loan Documents) of receipt of such communication.
Except as otherwise provided in this Agreement, unless a Lender shall give written notice to the
Agent that it specifically objects to the recommendation or determination of the Agent (together
with a written explanation of the reasons behind such objection) within the applicable time period
for reply, such Lender shall be deemed to have conclusively approved of or consented to such
recommendation or determination.



Section 12.6. Lender Credit Decision, Etc.




     Each Lender expressly acknowledges and agrees that neither the Agent nor any of its officers,
directors, employees, agents, counsel, attorneys-in-fact or other affiliates has made any
representations or warranties as to the financial condition, operations, creditworthiness, solvency
or other information concerning the business or affairs of the Borrower, any other Loan Party,



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any
Subsidiary or any other Person to such Lender and that no act by the Agent hereafter taken,
including any review of the affairs of the Borrower, any other Loan Party or any other Subsidiary,
shall be deemed to constitute any such representation or warranty by the Agent to any Lender. Each
Lender acknowledges that it has made its own credit and legal analysis and decision to enter into
this Agreement and the transactions contemplated hereby, independently and without reliance upon
the Agent, any other Lender or counsel to the Agent, or any of their respective officers,
directors, employees and agents, and based on the financial statements of the Borrower, the
Subsidiaries or any other Affiliate thereof, and inquiries of such Persons, its independent due
diligence of the business and affairs of the Borrower, the other Loan Parties, the Subsidiaries and
other Persons, its review of the Loan Documents, the legal opinions required to be delivered to it
hereunder, the advice of its own counsel and such other documents and information as it has deemed
appropriate. Each Lender also acknowledges that it will, independently and without reliance upon
the Agent, any other Lender or counsel to the Agent or any of their respective officers, directors,
employees and agents, and based on such review, advice, documents and information as it shall deem
appropriate at the time, continue to make its own decisions in taking or not taking action under
the Loan Documents. Except for notices, reports and other documents and information expressly
required to be furnished to the Lenders by the Agent under this Agreement or any of the other Loan
Documents, the Agent shall have no duty or responsibility to provide any Lender with any credit or
other information concerning the business, operations, property, financial and other condition or
creditworthiness of the Borrower, any other Loan Party or any other Affiliate thereof which may
come into possession of the Agent, or any of its officers, directors, employees, agents,
attorneys-in-fact or other affiliates. Each Lender acknowledges that the Agent’s legal counsel in
connection with the transactions contemplated by this Agreement is only acting as counsel to the
Agent and is not acting as counsel to such Lender.




Section 12.7. Collateral Matters.




     (a) The Agent is authorized on behalf of all of the Lenders, without the necessity of any
notice to or further consent from any Lender, from time to time prior to an Event of Default, to
take any action with respect to any Collateral or Loan Documents which may be necessary to perfect
and maintain perfected the Liens upon the Collateral granted pursuant to any of the Loan Documents.



     (b) The Lenders hereby authorize the Agent, at its option and in its discretion, to release
any Lien granted to or held by the Agent upon any Collateral (i) upon termination of this Agreement
in accordance with Section 13.10.; or (ii) as required or permitted by Section 4.3. Upon request
by the Agent at any time, the Lenders will confirm in writing the Agent’s authority to release
particular types or items of Collateral pursuant to this Section or any other applicable provision
of any of the other Loan Documents.



     (c) Upon any sale and transfer of Collateral which is expressly permitted pursuant to the
terms of this Agreement, and upon at least 5 Business Days’ prior written request by the Borrower,
the Agent shall (and is hereby irrevocably authorized by all of the Lenders to) execute such
documents as may be necessary to evidence the release of the Liens granted to the Agent for the
benefit of the Lenders herein or pursuant hereto upon the Collateral that was sold or transferred;
provided, however, that (i) the Agent shall not be required to execute any such



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document on terms
which, in the Agent’s opinion, would expose the Agent to liability or create any obligation or
entail any consequence other than the release of such Liens without recourse or warranty; and (ii)
such release shall not in any manner discharge, affect or impair the Obligations or any Liens upon
(or obligations of the Borrower or any Loan Party in respect of) all interests retained by the
Borrower or any Subsidiary, including (without limitation) the proceeds of the sale, all of which
shall continue to constitute part of the Collateral. In the event of any sale or transfer of
Collateral, or any foreclosure with respect to any of the Collateral, the Agent shall be authorized
to deduct all of the expenses reasonably incurred by the Agent from the proceeds of any such sale,
transfer or foreclosure.




     (d) The Agent shall have no obligation whatsoever to the Lenders or to any other Person to
assure that the Collateral exists or is owned by any Loan Party or is cared for, protected or
insured or that the Liens granted to the Agent herein or pursuant hereto have been properly or
sufficiently or lawfully created, perfected, protected or enforced or are entitled to any
particular priority, or to exercise or to continue exercising at all or in any manner or under any
duty of care, disclosure or fidelity any of the rights, authorities and powers granted or available
to the Agent in this Section or in any of the Loan Documents, it being understood and agreed that
in respect of the Collateral, or any act, omission or event related thereto, the Agent may act in
any manner it may deem appropriate, in its sole discretion, given the Agent’s own interest in the
Collateral as one of the Lenders and that the Agent shall have no duty or liability whatsoever to
the Lenders, except to the extent found in a final non-appealable judgment by a court of competent
jurisdiction to have resulted from the Agent’s gross negligence or willful misconduct.



Section 12.8. Indemnification of Agent.




     Each Lender agrees to indemnify the Agent (to the extent not reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so) pro rata in accordance with such Lender’s
respective Commitment Percentage, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, reasonable out-of-pocket costs and expenses, or
disbursements of any kind or nature whatsoever which may at any time be imposed on, incurred by, or
asserted against the Agent (in its capacity as Agent but not as a Lender) in any way relating to or
arising out of the Loan Documents, any transaction contemplated hereby or thereby or any action
taken or omitted by the Agent under the Loan Documents (collectively, “Indemnifiable Amounts”);
provided, however, that no Lender shall be liable for any portion of such Indemnifiable Amounts to
the extent resulting from the Agent’s gross negligence or willful misconduct as determined by a
court of competent jurisdiction in a final, non-appealable judgment or if the Agent fails to follow
the written direction of the Requisite Lenders (or all of the Lenders if expressly required
hereunder) unless such failure results from the Agent following the advice of counsel to the Agent
of which advice the Lenders have received notice. Without limiting the generality of the foregoing
but subject to the preceding proviso, each Lender agrees to reimburse the Agent (to the extent not
reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), promptly
upon demand for its ratable share of any out-of-pocket expenses (including counsel fees of the
counsel(s) of the Agent’s own choosing) incurred by the Agent in connection with the preparation,
negotiation, execution, or enforcement of, or legal advice with respect to the rights or
responsibilities of the parties under, the Loan Documents, any suit or action brought by the Agent
to enforce the terms of the Loan Documents and/or collect any Obligations, any “lender



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liability”
suit or claim brought against the Agent and/or the Lenders, and any claim or suit brought against
the Agent, and/or the Lenders arising under any Environmental Laws. Such out-of-pocket expenses
(including counsel fees) shall be advanced by the Lenders on the request of the Agent
notwithstanding any claim or assertion that the Agent is not entitled to indemnification hereunder
upon receipt of an undertaking by the Agent that the Agent will reimburse the Lenders if it is
actually and finally determined by a court of competent jurisdiction that the Agent is not so
entitled to indemnification. The agreements in this Section shall survive the payment of the Loans
and all other amounts payable hereunder or under the other Loan Documents and the termination of
this Agreement. If the Borrower shall reimburse the Agent for any Indemnifiable Amount following
payment by any Lender to the Agent in respect of such Indemnifiable Amount pursuant to this
Section, the Agent shall share such reimbursement on a ratable basis with each Lender making any
such payment.




Section 12.9. Successor Agent.




     The Agent may resign at any time as Agent under the Loan Documents by giving written notice
thereof to the Lenders and the Borrower. Upon any such resignation, the Requisite Lenders shall
have the right to appoint a successor Agent which appointment shall, provided no Default or Event
of Default exists, be subject to the Borrower’s approval, which approval shall not be unreasonably
withheld or delayed. If no successor Agent shall have been so appointed in accordance with the
immediately preceding sentence, and shall have accepted such appointment, within 30 days after the
resigning Agent’s giving of notice of resignation, then the resigning Agent may, on behalf of the
Lenders, appoint a successor Agent, which shall be a Lender, if any Lender shall be willing to
serve, and otherwise shall be a commercial bank having total combined assets of at least
$50,000,000,000 and provided no Default or Event of Default exists, shall be subject to the
Borrower’s approval, which approval shall not be unreasonably withheld or delayed. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and obligations under
the Loan Documents. Such successor Agent shall issue letters of credit in substitution for the
Letters of Credit, if any, outstanding at the time of such succession or shall make other
arrangements satisfactory to the current Agent, in either case, to assume effectively the
obligations of the current Agent with respect to such Letters of Credit. After any Agent’s
resignation hereunder as Agent, the provisions of this Article XII. shall continue to inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent under the Loan
Documents.



Section 12.10. Titled Agents.




     Each of the Titled Agents in each such respective capacity, assumes no responsibility or
obligation hereunder, including, without limitation, for servicing, enforcement or collection of
any of the Loans, or for any duties as an agent hereunder for the Lenders. The titles of
“Arranger”, “Syndication Agent”, “Documentation Agent” and other similar titles are solely
honorific and imply no fiduciary responsibility on the part of the Titled Agents to the Agent, the
Borrower or any Lender and the use of such titles does not impose on the Titled Agents any duties
or obligations greater than those of any other Lender or entitle the Titled Agents to any rights
other than those to which any other Lender is entitled.



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Article XIII. Miscellaneous




Section 13.1. Notices.




     Unless otherwise provided herein, communications provided for hereunder shall be in writing
and shall be mailed, telecopied or delivered as follows:



     If to the Borrower:


Government Properties Trust, Inc.

13625 California Street, Suite 310

Omaha, Nebraska 68154

Attn: Chief Financial Officer

Telephone:     (402) 391-0010

Telecopy:      (402) 391-4144



     If to the Agent:


Wachovia Bank, National Association

301 S. College Street, NC0172

Charlotte, North Carolina 28288

Attn: Nachette Hadden

Telephone:     (704) 383-8763

Telecopy:     (704) 383-6205



     If to a Lender:




To such Lender’s address or telecopy number, as applicable, set forth on its
signature page hereto or in the applicable Assignment and Acceptance Agreement;


or, as to each party at such other address as shall be designated by such party in a written notice
to the other parties delivered in compliance with this Section. All such notices and other
communications shall be effective (i) if mailed, when received; (ii) if telecopied, when
transmitted; or (iii) if hand delivered or sent by overnight courier, when delivered.
Notwithstanding the immediately preceding sentence, all notices or communications to the Agent or
any Lender under Article II. shall be effective only when actually received. Neither the Agent nor
any Lender shall incur any liability to the Borrower (nor shall the Agent incur any liability to
the Lenders) for acting upon any telephonic notice referred to in this Agreement which the Agent or
such Lender, as the case may be, believes in good faith to have been given by a Person authorized
to deliver such notice or for otherwise acting in good faith hereunder. Failure of a Person
designated to get a copy of a notice to receive such copy shall not affect the validity of notice
properly given to any other Person.

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Section 13.2. Expenses.




     The Borrower agrees (a) to pay or reimburse the Agent for all of its reasonable out-of-pocket
costs and expenses actually incurred in connection with the preparation, negotiation and execution
of, and any amendment, supplement or modification to, any of the Loan Documents (including due
diligence expenses and travel expenses relating to closing), and the consummation of the
transactions contemplated thereby, including (i) the reasonable fees and disbursements of counsel
to the Agent, (ii) reasonable costs and expenses in connection with the use of IntraLinks, Inc.,
SyndTrak or other similar information transmission systems in connection with the Loan Documents,
(iii) reasonable costs and expenses actually incurred by the Agent in connection with the review of
Properties for inclusion in calculations of the Borrowing Base and the Agent’s other activities
under Article IV., including the cost of all Appraisals, title insurance, any inspection by the
Agent of any such Properties, and the reasonable fees and disbursements of counsel to the Agent
relating to all such activities, (b) to pay or reimburse the Agent and the Lenders for all their
reasonable costs and expenses actually incurred in connection with the enforcement or preservation
of any rights under the Loan Documents, including the reasonable fees and disbursements of their
respective counsel (including the allocated fees and expenses of in-house counsel) and any payments
in indemnification or otherwise payable by the Lenders to the Agent pursuant to the Loan Documents,
(c) to pay, and indemnify and hold harmless the Agent and the Lenders from, any and all recording
and filing fees and any and all liabilities with respect to, or resulting from any failure to pay
or delay in paying, documentary, stamp, excise and other similar taxes, if any, which may be
payable or determined to be payable in connection with the execution and delivery of any of the
Loan Documents, or consummation of any amendment, supplement or modification of, or any waiver or
consent under or in respect of, any Loan Document and (d) to the extent not already covered by any
of the preceding subsections, to pay or reimburse the Agent and the Lenders for all their costs and
expenses incurred in connection with any bankruptcy or other proceeding of the type described in
Section 11.1.(f) or 11.1.(g), including the reasonable fees and disbursements of counsel to the
Agent and any Lender, whether such fees and expenses are incurred prior to, during or after the
commencement of such proceeding or the confirmation or conclusion of any such proceeding. If the
Borrower shall fail to pay any amounts required to be paid by it pursuant to this Section, the
Agent and/or the Lenders may pay such amounts on behalf of the Borrower and either deem the same to
be Loans outstanding hereunder or otherwise Obligations owing hereunder. So long as no Event of
Default exists, the Agent agrees that upon the Borrower’s request with respect to a specific matter
the Agent shall provide to the Borrower an estimate of expenses payable by the Borrower under the
immediately preceding clause (a) in connection with such matter and shall make a good faith effort
to minimize such expenses when reasonably practical to do so.



Section 13.3. Setoff.




     Subject to Section 3.3. and in addition to any rights now or hereafter granted under
Applicable Law and not by way of limitation of any such rights, the Agent, each Lender and each
Participant is hereby authorized by the Borrower, at any time or from time to time during the
continuance of an Event of Default, without prior notice to the Borrower or to any other Person,
any such notice being hereby expressly waived, but in the case of a Lender or Participant subject
to receipt of the prior written consent of the Agent exercised in its sole discretion, to set



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off
and to appropriate and to apply any and all deposits (general or special, including, but not
limited to, indebtedness evidenced by certificates of deposit, whether matured or unmatured) and
any other indebtedness at any time held or owing by the Agent, such Lender or any affiliate of the
Agent or such Lender, to or for the credit or the account of the Borrower against and on account of
any of the Obligations, irrespective of whether or not any or all of the Loans and all other
Obligations have been declared to be, or have otherwise become, due and payable as permitted by
Section 11.2., and although such obligations shall be contingent or unmatured.




Section 13.4. Litigation; Jurisdiction; Other Matters; Waivers.




     (a) EACH PARTY HERETO ACKNOWLEDGES THAT ANY DISPUTE OR CONTROVERSY BETWEEN OR AMONG THE
BORROWER, THE AGENT OR ANY OF THE LENDERS WOULD BE BASED ON DIFFICULT AND COMPLEX ISSUES OF LAW AND
FACT AND WOULD RESULT IN DELAY AND EXPENSE TO THE PARTIES. ACCORDINGLY, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, EACH OF THE LENDERS, THE AGENT AND THE BORROWER HEREBY WAIVES ITS RIGHT TO A TRIAL
BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT OR TRIBUNAL IN WHICH AN
ACTION MAY BE COMMENCED BY OR AGAINST ANY PARTY HERETO ARISING OUT OF THIS AGREEMENT, THE NOTES, OR
ANY OTHER LOAN DOCUMENT OR BY REASON OF ANY OTHER SUIT, CAUSE OF ACTION OR DISPUTE WHATSOEVER
BETWEEN OR AMONG THE BORROWER, THE AGENT OR ANY OF THE LENDERS OF ANY KIND OR NATURE RELATING TO
ANY OF THE LOAN DOCUMENTS.



     (b) EACH OF THE BORROWER, THE AGENT AND EACH LENDER HEREBY AGREES THAT ANY FEDERAL DISTRICT
COURT AND ANY STATE COURT LOCATED IN THE BOROUGH OF MANHATTAN, NEW YORK, NEW YORK, SHALL HAVE
JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN OR AMONG THE BORROWER, THE AGENT
OR ANY OF THE LENDERS, PERTAINING DIRECTLY OR INDIRECTLY TO THIS AGREEMENT, THE LOANS AND LETTERS
OF CREDIT, THE NOTES OR ANY OTHER LOAN DOCUMENT OR TO ANY MATTER ARISING HEREFROM OR THEREFROM.
THE BORROWER AND EACH OF THE LENDERS EXPRESSLY SUBMIT AND CONSENT IN ADVANCE TO SUCH JURISDICTION
IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH COURTS WITH RESPECT TO SUCH CLAIMS OR DISPUTES. EACH
PARTY FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH
ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN
INCONVENIENT FORUM, AND EACH AGREES NOT TO PLEAD OR CLAIM THE SAME. THE CHOICE OF FORUM SET FORTH
IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE BRINGING OF ANY ACTION BY THE AGENT OR ANY
LENDER OR THE ENFORCEMENT BY THE AGENT OR ANY LENDER OF ANY JUDGMENT OBTAINED IN SUCH FORUM IN ANY
OTHER APPROPRIATE JURISDICTION.



     (c) THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE ADVICE OF
COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES THEREOF, AND SHALL




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SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER AMOUNTS PAYABLE HEREUNDER OR UNDER THE OTHER
LOAN DOCUMENTS, THE TERMINATION OR EXPIRATION OF ALL LETTERS OF CREDIT AND THE TERMINATION OF THIS
AGREEMENT.




Section 13.5. Successors and Assigns.




     (a) Successors and Assigns Generally. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of the Agent and each Lender and
no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to
an assignee in accordance with the provisions of the immediately following subsection (b), (ii) by
way of participation in accordance with the provisions of the immediately following subsection (d)
or (iii) by way of pledge or assignment of a security interest subject to the restrictions of the
immediately following subsection (f) (and any other attempted assignment or transfer by any party
hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their respective successors and
assigns permitted hereby, Participants to the extent provided in the immediately following
subsection (d) and, to the extent expressly contemplated hereby, the affiliates and the partners,
directors, officers, employees, agents and advisors of the Agent and the Lenders and of their
respective affiliates) any legal or equitable right, remedy or claim under or by reason of this
Agreement.



     (b) Assignments by Lenders. Any Lender may at any time assign to one or more Eligible
Assignees (each an “Assignee”) all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans at the time owing to it);
provided that any such assignment shall be subject to the following conditions:




     (i) Minimum Amounts.




     (A) in the case of an assignment of the entire remaining amount of the
assigning Lender’s Commitment and the Loans at the time owing to it or in the case
of an assignment to a Lender, an affiliate of a Lender or an Approved Fund, no
minimum amount need be assigned; and




     (B) in any case not described in the immediately preceding subsection (A), the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the applicable Commitment is not then in effect, the
principal outstanding balance of the Loans of the assigning Lender subject to each
such assignment shall not be less than $5,000,000, unless each of the Agent and, so
long as no Default or Event of Default shall exist, the Borrower otherwise consents
(each such consent not to be unreasonably withheld or delayed).



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     (ii) Proportionate Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and obligations
under this Agreement with respect to the Loan or the Commitment assigned.




     (iii) Required Consents. No consent shall be required for any assignment
except to the extent required by clause (i)(B) of this subsection (b) and, in addition:




     (A) the consent of the Borrower (such consent not to be unreasonably withheld
or delayed) shall be required unless (x) a Default or Event of Default shall exist
at the time of such assignment or (y) such assignment is to a Lender or an affiliate
of a Lender (other than an affiliate that is an Approved Fund); and




     (B) the consent of the Agent (such consent not to be unreasonably withheld or
delayed) shall be required for assignments in respect of a Commitment if such
assignment is to a Person that is not already a Lender with a Commitment.




     (iv) Assignment and Acceptance. The parties to each assignment shall execute
and deliver to the Agent an Assignment and Acceptance, together with a processing and
recordation fee of $3,500 for each assignment, and the assignee, if it is not a Lender,
shall deliver to the Agent an administrative questionnaire in the form customarily required
by the Agent.




     (v) No Assignment to Borrower. No such assignment shall be made to the
Borrower or any of the Borrower’s Affiliates or Subsidiaries.




     (vi) No Assignment to Natural Persons. No such assignment shall be made to a
natural person.


Subject to acceptance and recording thereof by the Agent pursuant to the immediately following
subsection (c), from and after the effective date specified in each Assignment and Acceptance, the
assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Acceptance, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender’s rights and obligations
under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be
entitled to the benefits of Sections 5.4., 13.2. and 13.9. and the other provisions of this
Agreement and the other Loan Documents as provided in Section 13.10. Any assignment or transfer by
a Lender of rights or obligations under this Agreement that does not comply with this paragraph
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 the immediately following subsection (d).




     (c) Register. The Agent, acting solely for this purpose as an agent of the Borrower,
shall maintain at the Principal Office a copy of each Assignment and Acceptance delivered to it



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and a register for the recordation of the names and addresses of the Lenders, and the Commitments
of, and principal amounts of the Loans owing to, each Lender pursuant to the terms hereof from time
to time (the “Register”). The entries in the Register shall be conclusive, and the Borrower, the
Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the
terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to
the contrary. The Register shall be available for inspection by the Borrower and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.




     (d) Participations. Any Lender may at any time, without the consent of, or notice to,
the Borrower or the Agent, sell participations to any Person (other than a natural person or the
Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a
portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion
of its Commitment and/or the Loans owing to it); provided that (i) such Lender’s obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (iii) the Borrower, the Agent and
the Lenders shall continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to
which a Lender sells such a participation shall provide that such Lender shall retain the sole
right to enforce this Agreement and to approve any amendment, modification or waiver of any
provision of this Agreement; provided that such agreement or instrument may provide that such
Lender will not, without the consent of the Participant, agree to any amendment, modification or
waiver of any provision of any Loan Document described in the second sentence of Section 13.6. that
adversely affects such Participant. Subject to the immediately following subsection (e), the
Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.12., 5.1.,
5.4. to the same extent as if it were a Lender and had acquired its interest by assignment pursuant
to paragraph (b) of this Section. To the extent permitted by Applicable Law, each Participant also
shall be entitled to the benefits of Section 13.3. as though it were a Lender, provided such
Participant agrees to be subject to Section 3.3. as though it were a Lender. Upon request from the
Agent, a Lender shall notify the Agent and the Borrower of the sale of any participation hereunder.



     (e) Limitations upon Participant Rights. A Participant shall not be entitled to
receive any greater payment under Sections 3.12. and 5.1. than the applicable Lender would have
been entitled to receive with respect to the participation sold to such Participant, unless the
sale of the participation to such Participant is made with the Borrower’s prior written consent. A
Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the
benefits of Section 3.12. unless the Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the Borrower and the Agent, to comply
with Section 3.12.(c) as though it were a Lender.



     (f) Certain Pledges. Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations of such Lender,
including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that
no such pledge or assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.



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     (g) No Registration. Each Lender agrees that, without the prior written consent of
the Borrower and the Agent, it will not make any assignment hereunder in any manner or under any
circumstances that would require registration or qualification of, or filings in respect of, any
Loan or Note under the Securities Act or any other securities laws of the United States of America
or of any other jurisdiction.



Section 13.6. Amendments.




     (a) Except as otherwise expressly provided in this Agreement, any consent or approval required
or permitted by this Agreement or any other Loan Document to be given by the Lenders may be given,
and any term of this Agreement or of any other Loan Document may be amended, and the performance or
observance by the Borrower or any other Loan Party or any Subsidiary of any terms of this Agreement
or such other Loan Document or the continuance of any Default or Event of Default may be waived
(either generally or in a particular instance and either retroactively or prospectively) with, but
only with, the written consent of the Requisite Lenders (and, in the case of an amendment to any
Loan Document, the written consent of each Loan Party a party thereto).



     (b) Notwithstanding the foregoing, without the prior written consent of each Lender adversely
affected thereby, no amendment, waiver or consent shall do any of the following:




     (i) increase the Commitments of the Lenders (except for any increase in the Commitments
effectuated pursuant to Section 2.15.) or subject the Lenders to any additional obligations;




     (ii) reduce the principal of, or interest rates that have accrued or that will be
charged on the outstanding principal amount of, any Loans or other Obligations;




     (iii) reduce the amount of any Fees payable hereunder or postpone any date fixed for
payment thereof;




     (iv) modify the definition of the term “Termination Date” (except as contemplated under
Section 2.12.) or otherwise postpone any date fixed for any payment of any principal of, or
interest on, any Loans or any other Obligations (including the waiver of any Default or
Event of Default as a result of the nonpayment of any such Obligations as and when due), or
extend the expiration date of any Letter of Credit beyond the Termination Date;




     (v) amend or otherwise modify the provisions of Section 3.2.;




     (vi) modify the definition of the term “Requisite Lenders” or otherwise modify in any
other manner the number or percentage of the Lenders required to make any determinations or
waive any rights hereunder or to modify any provision hereof, including without limitation,
any modification of this Section 13.6. if such modification would have such effect;



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     (vii) release any Guarantor from its obligations under the Guaranty (except as
otherwise permitted under Section 8.12.(c) or in connection with the release of a Collateral
Property as permitted in Section 4.3.);




     (viii) release any of the Collateral from the Lien of the Security Documents other than
as provided in Section 4.3. in connection with the release of a Collateral Property or
Section 4.7. in connection with the release of a Derivatives Contract;




     (ix) amend or otherwise modify the provisions of Section 2.14.(a); or




     (x) increase the number of Interest Periods permitted with respect to Loans under
Section 2.5.



     (c) No amendment, waiver or consent, unless in writing and signed by the Agent, in such
capacity, in addition to the Lenders required hereinabove to take such action, shall affect the
rights or duties of the Agent under this Agreement or any of the other Loan Documents. Any
amendment, waiver or consent relating to Section 2.2. or the obligations of the Swingline Lender
under this Agreement or any other Loan Document shall, in addition to the Lenders required
hereinabove to take such action, require the written consent of the Swingline Lender.



     (d) No waiver shall extend to or affect any obligation not expressly waived or impair any
right consequent thereon and any amendment, waiver or consent shall be effective only in the
specific instance and for the specific purpose set forth therein. Except as otherwise provided in
Section 12.5., no course of dealing or delay or omission on the part of the Agent or any Lender in
exercising any right shall operate as a waiver thereof or otherwise be prejudicial thereto. Any
Event of Default occurring hereunder shall continue to exist until such time as such Event of
Default is waived in writing in accordance with the terms of this Section, notwithstanding any
attempted cure or other action by the Borrower, any other Loan Party or any other Person subsequent
to the occurrence of such Event of Default. Except as otherwise explicitly provided for herein or
in any other Loan Document, no notice to or demand upon the Borrower shall entitle the Borrower to
any other or further notice or demand in similar or other circumstances.



Section 13.7. Nonliability of Agent and Lenders.




     The relationship between the Borrower and the Lenders and the Agent shall be solely that of
borrower and lender. Neither the Agent nor any Lender shall have any fiduciary responsibilities to
the Borrower and no provision in this Agreement or in any of the other Loan Documents, and no
course of dealing between or among any of the parties hereto, shall be deemed to create any
fiduciary duty owing by the Agent or any Lender to any Lender, the Borrower, any Subsidiary or any
other Loan Party. Neither the Agent nor any Lender undertakes any responsibility to the Borrower
to review or inform the Borrower of any matter in connection with any phase of the Borrower’s
business or operations.



Section 13.8. Confidentiality.




     The Agent and each Lender shall use reasonable efforts to assure that information about
Borrower, the other Loan Parties and other Subsidiaries, and the Properties thereof and their



- 101 -









 




operations, affairs and financial condition, not generally disclosed to the public, which is
furnished to the Agent or any Lender pursuant to the provisions of this Agreement or any other Loan
Document, is used only for the purposes of this Agreement and the other Loan Documents and shall
not be divulged to any Person other than the Agent, the Lenders, and their respective agents who
are actively and directly participating in the evaluation, administration or enforcement of the
Loan Documents and other transactions between the Agent or such Lender, as applicable, and the
Borrower, but in any event the Agent and the Lenders may make disclosure: (a) to any of their
respective affiliates (provided they shall agree to keep such information confidential in
accordance with the terms of this Section 13.8.); (b) as reasonably requested by any potential or
actual Assignee, Participant or other transferee in connection with the contemplated transfer of
any Commitment or participations therein as permitted hereunder (provided they shall agree to keep
such information confidential in accordance with the terms of this Section); (c) as required or
requested by any Governmental Authority or representative thereof or pursuant to legal process or
in connection with any legal proceedings or as otherwise required by Applicable Law; (d) to the
Agent’s or such Lender’s independent auditors and other professional advisors (provided they shall
be notified of the confidential nature of the information); (e) after the happening and during the
continuance of an Event of Default, to any other Person, in connection with the exercise by the
Agent or the Lenders of rights hereunder or under any of the other Loan Documents; (f) upon
Borrower’s prior consent (which consent shall not be unreasonably withheld), to any contractual
counter-parties to any swap or similar hedging agreement or to any rating agency; and (g) to the
extent such information (x) becomes publicly available other than as a result of a breach of this
Section actually known to such Lender to be such a breach or (y) becomes available to the Agent or
any Lender on a nonconfidential basis from a source other than the Borrower or any Affiliate.
Notwithstanding the foregoing, the Agent and each Lender may disclose any such confidential
information, without notice to the Borrower or any other Loan Party, to Governmental Authorities in
connection with any regulatory examination of the Agent or such Lender or in accordance with the
regulatory compliance policy of the Agent or such Lender.




Section 13.9. Indemnification.




     (a) The Borrower shall and hereby agrees to indemnify, defend and hold harmless the Agent,
each of the Lenders, any affiliate of the Agent or any Lender, and their respective directors,
officers, shareholders, agents, employees and counsel (each referred to herein as an “Indemnified
Party”) from and against any and all of the following (collectively, the “Indemnified Costs”):
losses, costs, claims, damages, liabilities, deficiencies, judgments or reasonable expenses of
every kind and nature (including, without limitation, amounts paid in settlement, court costs and
the reasonable fees and disbursements of counsel incurred in connection with any litigation,
investigation, claim or proceeding or any advice rendered in connection therewith, but excluding
losses, costs, claims, damages, liabilities, deficiencies, judgments or expenses indemnification in
respect of which is specifically covered by Section 3.12. or 5.1. or expressly excluded from the
coverage of such Section 3.12. or 5.1.) incurred by an Indemnified Party in connection with,
arising out of, or by reason of, any suit, cause of action, claim, arbitration, investigation or
settlement, consent decree or other proceeding (the foregoing referred to herein as an “Indemnity
Proceeding”) which is in any way related directly or indirectly to: (i) this Agreement or any other
Loan Document or the transactions contemplated thereby; (ii) the making of any Loans or issuance of
Letters of Credit hereunder;



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(iii) any actual or proposed use by the Borrower of the proceeds of the Loans or Letters of Credit; (iv) the Agent’s
or any Lender’s entering into this Agreement; (v) the fact that the Agent and the Lenders have
established the credit facility evidenced hereby in favor of the Borrower; (vi) the fact that the
Agent and the Lenders are creditors of the Borrower and have or are alleged to have information
regarding the financial condition, strategic plans or business operations of the Borrower and the
Subsidiaries; (vii) the fact that the Agent and the Lenders are material creditors of the Borrower
and are alleged to influence directly or indirectly the business decisions or affairs of the
Borrower and the Subsidiaries or their financial condition; (viii) the exercise of any right or
remedy the Agent or the Lenders may have under this Agreement or the other Loan Documents; (ix) any
civil penalty or fine assessed by the OFAC against, and all reasonable costs and expenses
(including counsel fees and disbursements) incurred in connection with defense thereof by, the
Agent or any Lender as a result of conduct of the Borrower, any other Loan Party or any Subsidiary
that violates a sanction enforced by the OFAC; or (x) any violation or non-compliance by the
Borrower or any Subsidiary of any Applicable Law (including any Environmental Law) including, but
not limited to, any Indemnity Proceeding commenced by (A) the Internal Revenue Service or state
taxing authority or (B) any Governmental Authority or other Person under any Environmental Law,
including any Indemnity Proceeding commenced by a Governmental Authority or other Person seeking
remedial or other action to cause the Borrower or its Subsidiaries (or its respective properties)
(or the Agent and/or the Lenders as successors to the Borrower) to be in compliance with such
Environmental Laws; provided, however, that the Borrower shall not be obligated to indemnify any
Indemnified Party for (A) any acts or omissions of such Indemnified Party in connection with
matters described in this subsection to the extent arising from the gross negligence or willful
misconduct of such Indemnified Party, as determined by a court of competent jurisdiction in a
final, non-appealable judgment, (B) Indemnified Costs to the extent arising directly out of or
resulting directly from claims of one or more Indemnified Parties against another Indemnified
Party, or (C) Indemnified Costs to the extent resulting from a claim brought by the Borrower or any
other Loan Party against an Indemnified Party for breach in bad faith of such Indemnified Party’s
obligations hereunder or under any other Loan Document, if the Borrower or such Loan Party has
obtained a final and nonappealable judgment in its favor on such claim as determined by a court of
competent jurisdiction. Not in limitation of any of the Borrower’s obligations under this Section
or Section 13.2., the Borrower agrees to indemnify, defend and hold harmless the Agent, each Lender
and each other Indemnified Party from and against any and all Indemnified Cots incurred by an
Indemnified Party in connection with, arising out of, or by reason of, any Indemnity Proceeding
which is in any way related directly or indirectly to the failure of any Person to pay any
recording tax payable in connection with a Security Deed (and any amendment or other modification
thereto) encumbering a NY Property under N.Y. Tax Law, Ch. 60, Art. 11, Sec. 253 et seq. or other
Applicable Laws of the State of New York or any political subdivision of such State.




     (b) The Borrower’s indemnification obligations under this Section 13.9. shall apply to all
Indemnity Proceedings arising out of, or related to, the foregoing whether or not an Indemnified
Party is a named party in such Indemnity Proceeding. In this regard, this indemnification shall
cover all Indemnified Costs of any Indemnified Party in connection with any deposition of any
Indemnified Party or compliance with any subpoena (including any subpoena requesting the production
of documents). This indemnification shall, among other



- 103 -









 




things, apply to any Indemnity Proceeding commenced by other creditors of the Borrower or any
Subsidiary, any shareholder of the Borrower or any Subsidiary (whether such shareholder(s) are
prosecuting such Indemnity Proceeding in their individual capacity or derivatively on behalf of the
Borrower), any account debtor of the Borrower or any Subsidiary or by any Governmental
Authority. If indemnification is to be sought hereunder by an Indemnified Party, then
such Indemnified Party shall notify the Borrower of the commencement of any Indemnity Proceeding;
provided, however, that the failure to so notify the Borrower shall not relieve the Borrower from
any liability that it may have to such Indemnified Party pursuant to this Section 13.9.




     (c) This indemnification shall apply to any Indemnity Proceeding arising during the pendency
of any bankruptcy proceeding filed by or against the Borrower and/or any Subsidiary.



     (d) All out-of-pocket fees and expenses of, and all amounts paid to third-persons by, an
Indemnified Party shall be advanced by the Borrower at the request of such Indemnified Party
notwithstanding any claim or assertion by the Borrower that such Indemnified Party is not entitled
to indemnification hereunder, upon receipt of an undertaking by such Indemnified Party that such
Indemnified Party will reimburse the Borrower if it is actually and finally determined by a court
of competent jurisdiction that such Indemnified Party is not so entitled to indemnification
hereunder.



     (e) An Indemnified Party may conduct its own investigation and defense of, and may formulate
its own strategy with respect to, any Indemnity Proceeding covered by this Section and, as provided
above, all Indemnified Costs incurred by such Indemnified Party shall be reimbursed by the
Borrower. No action taken by legal counsel chosen by an Indemnified Party in investigating or
defending against any such Indemnity Proceeding shall vitiate or in any way impair the obligations
and duties of the Borrower hereunder to indemnify and hold harmless each such Indemnified Party;
provided, however, that if (i) the Borrower is required to indemnify an Indemnified Party pursuant
hereto and (ii) the Borrower has provided evidence reasonably satisfactory to such Indemnified
Party that the Borrower has the financial wherewithal to reimburse such Indemnified Party for any
amount paid by such Indemnified Party with respect to such Indemnity Proceeding, such Indemnified
Party shall not settle or compromise any such Indemnity Proceeding without the prior written
consent of the Borrower (which consent shall not be unreasonably withheld or delayed).
Notwithstanding the foregoing, an Indemnified Party may settle or compromise any such Indemnity
Proceeding without the prior written consent of the Borrower where (x) no monetary relief is sought
against such Indemnified Party in such Indemnity Proceeding or (y) there is an allegation of a
violation of law by such Indemnified Party.



     (f) If and to the extent that the obligations of the Borrower under this Section are
unenforceable for any reason, the Borrower hereby agrees to make the maximum contribution to the
payment and satisfaction of such obligations which is permissible under Applicable Law.



     (g) The Borrower’s obligations under this Section shall survive any termination of this
Agreement and the other Loan Documents and the payment in full in cash of the Obligations, and are
in addition to, and not in substitution of, any other of their obligations set forth in this
Agreement or any other Loan Document to which it is a party.



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Section 13.10. Termination; Survival.




     At such time as (a) all of the Commitments have been terminated, (b) all Letters of Credit
have terminated or expired, (c) none of the Lenders nor the Swingline Lender is obligated any
longer under this Agreement to make any Loans and (d) all Obligations (other than obligations which
survive as provided in the following sentence) have been paid and satisfied in full, this Agreement
shall terminate. The indemnities to which the Agent, the Lenders and the Swingline Lender are
entitled under the provisions of Sections 3.12., 5.1., 5.4., 12.8., 13.2. and 13.9. and any other
provision of this Agreement and the other Loan Documents, and the provisions of Section 13.4.,
shall continue in full force and effect and shall protect the Agent, the Lenders and the Swingline
Lender (i) notwithstanding any termination of this Agreement, or of the other Loan Documents,
against events arising after such termination as well as before and (ii) at all times after any
such party ceases to be a party to this Agreement with respect to all matters and events existing
on or prior to the date such party ceased to be a party to this Agreement.



Section 13.11. Severability of Provisions.




     Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remainder of such provision or the remaining provisions
or affecting the validity or enforceability of such provision in any other jurisdiction.



Section 13.12. GOVERNING LAW.




     THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.



Section 13.13. Patriot Act.




     The Lenders and the Agent each hereby notifies the Borrower that pursuant to the requirements
of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), it is
required to obtain, verify and record information that identifies the Borrower, which information
includes the name and address of the Borrower and other information that will allow such Lender or
the Agent, as applicable, to identify the Borrower in accordance with such Act.



Section 13.14. Counterparts.




     This Agreement and any amendments, waivers, consents or supplements may be executed in any
number of counterparts and by different parties hereto in separate counterparts, each of which when
so executed and delivered shall be deemed an original, but all of which counterparts together shall
constitute but one and the same instrument.



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Section 13.15. Obligations with Respect to Loan Parties.




     The obligations of the Borrower to direct or prohibit the taking of certain actions by the
other Loan Parties as specified herein shall be absolute and not subject to any defense the
Borrower may have that the Borrower does not control such Loan Parties.



Section 13.16. Limitation of Liability.




     Neither the Agent nor any Lender, nor any affiliate, officer, director, employee, attorney, or
agent of the Agent or any Lender shall have any liability with respect to, and the Borrower hereby
waives, releases, and agrees not to sue any of them upon, any claim for any special, indirect,
incidental, or consequential damages suffered or incurred by the Borrower in connection with,
arising out of, or in any way related to, this Agreement or any of the other Loan Documents, or any
of the transactions contemplated by this Agreement or any of the other Loan Documents. The
Borrower hereby waives, releases, and agrees not to sue the Agent or any Lender or any of the
Agent’s or any Lender’s affiliates, officers, directors, employees, attorneys, or agents for
punitive damages in respect of any claim in connection with, arising out of, or in any way related
to, this Agreement or any of the other Loan Documents, or any of the transactions contemplated by
this Agreement or financed hereby.



Section 13.17. Entire Agreement.




     This Agreement, the Notes, and the other Loan Documents referred to herein embody the final,
entire agreement among the parties hereto and supersede any and all prior commitments, agreements,
representations, and understandings, whether written or oral, relating to the subject matter hereof
and thereof and may not be contradicted or varied by evidence of prior, contemporaneous, or
subsequent oral agreements or discussions of the parties hereto. There are no oral agreements
among the parties hereto.



Section 13.18. Construction.




     The Agent, the Borrower and each Lender acknowledge that each of them has had the benefit of
legal counsel of its own choice and has been afforded an opportunity to review this Agreement and
the other Loan Documents with its legal counsel and that this Agreement and the other Loan
Documents shall be construed as if jointly drafted by the Agent, the Borrower and each Lender.



[Signatures on Following Pages]







- 106 -









 








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



	 	 	 	 	 	 	 	 	 
	 	 	GOVERNMENT PROPERTIES TRUST, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	/s/ Thomas D. Peschio	 	 	 	 
	 	 	 	 	 
	 	 
	 

	 	 	 	Name:	 	Thomas D. Peschio	 	 
	 

	 	 	 	 	 	 
	 	 
	 

	 	 	 	Title:	 	Chief Executive Officer	 	 
	 

	 	 	 	 	 	 
	 	 






[Signatures Continued on Next Page]





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[Signature Page to Credit Agreement dated as of

November 21, 2005 with Government Properties Trust, Inc.]




	 	 	 	 	 	 	 	 	 
	 	 	WACHOVIA BANK, NATIONAL ASSOCIATION, as	 	 
	 	 	     Agent, as a Lender and as Swingline Lender	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	/s/ Wesley G.
Carter	 	 	 	 
	 	 	 	 	 
	 	 
	 

	 	 	 	Name:	 	Wesley G.
Carter	 	 
	 

	 	 	 	 	 	 
	 	 
	 

	 	 	 	Title:	 	Director	 	 
	 

	 	 	 	 	 	 
	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Commitment Amount:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	$35,000,000.00	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Lending Office (all Types of Loans):	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Wachovia Bank, National Association	 	 
	 	 	301 S. College Street, NC0172	 	 
	 	 	Charlotte, North Carolina 28288	 	 
	 	 	Attn: Nachette Hadden	 	 
	 	 	Telephone: (704) 383-8763	 	 
	 	 	Telecopy: (704) 383-6205	 	 






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[Signature Page to Credit Agreement dated as of

November 21, 2005 with Government Properties Trust, Inc.]




	 	 	 	 	 	 	 	 	 
	 	 	FIRST NATIONAL BANK OF OMAHA	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	/s/ Daniel M.
Shultz	 	 	 	 
	 	 	 	 	 
	 	 
	 

	 	 	 	Name:	 	Daniel M.
Shultz	 	 
	 

	 	 	 	 	 	 
	 	 
	 

	 	 	 	Title:	 	Vice President	 	 
	 

	 	 	 	 	 	 
	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Commitment Amount:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	$15,000,000.00	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Lending Office (all Types of Loans):	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	1620 Dodge Street — Stop 4300	 	 
	 	 	Omaha, NE 68197-4300	 	 
	 	 	Attn: Daniel M. Shultz — GPT Revolver	 	 
	 	 	Telephone: (402) 498-5308	 	 
	 	 	Telecopy: (402) 498-5327	 	 






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