Document:

exv10w60

 

Exhibit 10.60

TERM LOAN AGREEMENT

Dated: As of April 24, 2006

between

HINES REIT PROPERTIES , L.P.

(the “Borrower”)

and

KEYBANK NATIONAL ASSOCIATION

(“Administrative Agent”)

and

and other Lenders, if any, which may become parties

to this Agreement (with KeyBank National Association, the “Lenders”)

$165,000,000.00 TERM LOAN

 

 

Exhibit 10.60

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page	 
	1.	 	 	 	BACKGROUND	 	 	2	 
	 
	 	1.1	 	 	 	Defined Terms	 	 	2	 
	 
	 	1.2	 	 	 	Borrower	 	 	2	 
	 
	 	1.3	 	 	 	Use of Loan Proceeds	 	 	2	 
	 
	 	1.4	 	 	 	Accounting Terms	 	 	2	 
	2.	 	 	 	LOAN PROVISIONS	 	 	2	 
	 
	 	2.1	 	 	 	Amount of Facility	 	 	2	 
	 
	 	2.2	 	 	 	Term of Facility	 	 	3	 
	 
	 	2.3	 	 	 	Interest Rate and Payment Terms	 	 	3	 
	 
	 	 	 	2.3.1	 	Borrower’s Options	 	 	3	 
	 
	 	 	 	2.3.2	 	Selection To Be Made	 	 	3	 
	 
	 	 	 	2.3.3	 	Increased Costs	 	 	4	 
	 
	 	 	 	2.3.4	 	Illegality	 	 	4	 
	 
	 	 	 	2.3.5	 	Notice	 	 	7	 
	 
	 	 	 	2.3.6	 	If No Notice	 	 	8	 
	 
	 	 	 	2.3.7	 	Telephonic Notice	 	 	8	 
	 
	 	 	 	2.3.8	 	Limits On Options	 	 	8	 
	 
	 	 	 	2.3.9	 	Payment and Calculation of Interest	 	 	8	 
	 
	 	 	 	2.3.10	 	Voluntary and Mandatory Principal Payments	 	 	9	 
	 
	 	 	 	2.3.11	 	Maturity	 	 	9	 
	 
	 	 	 	2.3.12	 	Method of Payment; Date of Credit	 	 	9	 
	 
	 	 	 	2.3.13	 	Billings	 	 	9	 
	 
	 	 	 	2.3.14	 	Default Rate	 	 	10	 
	 
	 	 	 	2.3.15	 	Late Charges	 	 	10	 
	 
	 	 	 	2.3.16	 	Make Whole Provision	 	 	10	 
	 
	 	2.4	 	 	 	Fees	 	 	11	 
	3.	 	 	 	SECURITY FOR THE LOAN; LOAN AND SECURITY DOCUMENTS	 	 	11	 
	 
	 	3.1	 	 	 	Credit Documents and Security Documents	 	 	11	 
	 
	 	3.2	 	 	 	Collateral	 	 	11	 
	 
	 	3.3	 	 	 	Borrower Escrow Account	 	 	13	 
	4.	 	 	 	CONTINUING AUTHORITY OF AUTHORIZED REPRESENTATIVES	 	 	15	 
	5.	 	 	 	CONDITIONS PRECEDENT	 	 	15	 
	 
	 	5.1	 	 	 	Satisfactory Credit Documents	 	 	15	 
	 
	 	5.2	 	 	 	No Material Change	 	 	15	 
	 
	 	5.3	 	 	 	Warranties and Representations Accurate	 	 	15	 
	 
	 	5.4	 	 	 	Financials and Appraisals	 	 	15	 
	 
	 	5.5	 	 	 	Environmental Compliance and Indemnification Agreements	 	 	15	 
	 
	 	5.6	 	 	 	Validity and Sufficiency of Security Documents	 	 	15	 
	 
	 	5.7	 	 	 	No Other Liens; Taxes and Municipal Charges Current	 	 	16	 
	 
	 	5.8	 	 	 	Organizational Documents and Entity Agreements	 	 	16	 
	 
	 	5.9	 	 	 	Votes, Consents and Authorizations	 	 	16	 
	 
	 	5.10	 	 	 	Legal and Other Opinions	 	 	16	 
	 
	 	5.11	 	 	 	Due Diligence	 	 	16	 
	 
	 	5.12	 	 	 	Fees and Expenses	 	 	16	 
	 
	 	5.13	 	 	 	Guaranty	 	 	16	 
	 
	 	5.14	 	 	 	No Default	 	 	16	 
	 
	 	5.15	 	 	 	No Litigation	 	 	16	 
	 
	 	5.16	 	 	 	Compliance with Covenants	 	 	17	 
	 
	 	5.17	 	 	 	Other	 	 	17	 
	6.	 	 	 	WARRANTIES AND REPRESENTATIONS	 	 	17	 
	 
	 	6.1	 	 	 	Financial Information	 	 	17	 
	 
	 	6.2	 	 	 	No Violations	 	 	17	 

 

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page	 
	 
	 	6.3	 	 	 	No Litigation	 	 	18	 
	 
	 	6.4	 	 	 	Compliance With Legal Requirements	 	 	18	 
	 
	 	6.5	 	 	 	Use of Proceeds	 	 	18	 
	 
	 	6.6	 	 	 	Entity Matters	 	 	18	 
	 
	 	 	 	6.6.1	 	Borrower	 	 	18	 
	 
	 	 	 	6.6.2	 	General Partner	 	 	18	 
	 
	 	 	 	6.6.3	 	Identity of General Partner	 	 	18	 
	 
	 	6.7	 	 	 	Valid and Binding	 	 	19	 
	 
	 	6.8	 	 	 	Deferred Compensation and ERISA	 	 	19	 
	 
	 	6.9	 	 	 	No Material Change; No Default	 	 	19	 
	 
	 	6.10	 	 	 	No Broker or Finder	 	 	19	 
	 
	 	6.11	 	 	 	Background Information and Certificates	 	 	20	 
	 
	 	6.12	 	 	 	Consents	 	 	20	 
	 
	 	6.13	 	 	 	Indebtedness	 	 	20	 
	 
	 	6.14	 	 	 	Government Regulation	 	 	20	 
	 
	 	6.15	 	 	 	Environmental Matters	 	 	20	 
	 
	 	6.16	 	 	 	Portfolio Assets	 	 	21	 
	 
	 	6.17	 	 	 	Full Disclosure	 	 	21	 
	 
	 	6.18	 	 	 	Subsidiaries	 	 	22	 
	 
	 	6.19	 	 	 	No Material Adverse Contracts, Etc	 	 	22	 
	 
	 	6.20	 	 	 	Compliance With Other Instruments, Laws, Etc.	 	 	22	 
	 
	 	6.21	 	 	 	Solvency	 	 	22	 
	 
	 	6.22	 	 	 	REIT Status	 	 	22	 
	 
	 	6.23	 	 	 	Patriot Act	 	 	22	 
	7.	 	 	 	COVENANTS	 	 	23	 
	 
	 	7.1	 	 	 	Notices	 	 	23	 
	 
	 	7.2	 	 	 	Financial Statements and Reports	 	 	23	 
	 
	 	 	 	7.2.1	 	Annual Statements	 	 	23	 
	 
	 	 	 	7.2.2	 	Periodic Statements	 	 	23	 
	 
	 	 	 	7.2.3	 	Data Requested	 	 	24	 
	 
	 	 	 	7.2.4	 	Tax Returns	 	 	24	 
	 
	 	 	 	7.2.5	 	Pro Forma	 	 	24	 
	 
	 	 	 	7.2.6	 	Officer’s Certificate	 	 	24	 
	 
	 	 	 	7.2.7	 	Information to Owners	 	 	24	 
	 
	 	 	 	7.2.8	 	Portfolio Investments	 	 	25	 
	 
	 	 	 	7.2.9	 	Auditor’s Reports	 	 	25	 
	 
	 	 	 	7.2.10	 	Environmental Reports	 	 	25	 
	 
	 	 	 	7.2.11	 	Notice of Default or Litigation	 	 	25	 
	 
	 	 	 	7.2.12	 	Reserved	 	 	26	 
	 
	 	 	 	7.2.13	 	Debt	 	 	26	 
	 
	 	 	 	7.2.14	 	Other Information	 	 	26	 
	 
	 	7.3	 	 	 	Financial Covenants	 	 	26	 
	 
	 	7.4	 	 	 	Indebtedness and Restrictions on Liens, Transfers and Additional Debt	 	 	27	 
	 
	 	7.5	 	 	 	Liens/Negative Pledges	 	 	28	 
	 
	 	7.6	 	 	 	Nature of Business	 	 	28	 
	 
	 	7.7	 	 	 	Limitations on Certain Transactions	 	 	28	 
	 
	 	7.8	 	 	 	Investments	 	 	29	 
	 
	 	7.9	 	 	 	Dividends and Distributions	 	 	29	 
	 
	 	7.10	 	 	 	Transactions with Portfolio Investments	 	 	29	 
	 
	 	7.11	 	 	 	Amendments	 	 	29	 
	 
	 	7.12	 	 	 	ERISA	 	 	29	 
	 
	 	7.13	 	 	 	Place for Records;  Inspection	 	 	30	 
	 
	 	7.14	 	 	 	Costs and Expenses	 	 	30	 
	 
	 	7.15	 	 	 	Compliance with Legal Requirements	 	 	30	 
	 
	 	7.16	 	 	 	MAI Appraisals	 	 	31	 
	 
	 	7.17	 	 	 	Title to Properties	 	 	31	 

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	 	 	 	 	 	 	 	 	Page	 
	 
	 	7.18	 	 	 	Insurance	 	 	31	 
	 
	 	7.19	 	 	 	Taxes	 	 	31	 
	 
	 	7.20	 	 	 	Compliance with Contracts, Licenses, and Permits	 	 	31	 
	 
	 	7.21	 	 	 	Replacement Documentation	 	 	32	 
	 
	 	7.22	 	 	 	Perfected Interest Covenants	 	 	32	 
	 
	 	7.23	 	 	 	Existence of the Borrower; Maintenance of REIT Status	 	 	32	 
	 
	 	7.24	 	 	 	Refinance of [Illinois] Property	 	 	32	 
	8.	 	 	 	SPECIAL PROVISIONS	 	 	32	 
	 
	 	8.1	 	 	 	Right to Contest	 	 	32	 
	 
	 	 	 	8.1.1	 	Taxes and Claims by Third Parties	 	 	32	 
	 
	 	 	 	8.1.2	 	Legal Requirements	 	 	33	 
	 
	 	8.2	 	 	 	Borrower Fully Liable	 	 	33	 
	9.	 	 	 	EVENTS OF DEFAULT	 	 	33	 
	 
	 	9.1	 	 	 	Default and Events of Default	 	 	33	 
	 
	 	 	 	9.1.1	 	Generally	 	 	33	 
	 
	 	 	 	9.1.2	 	Note and Other Credit Documents	 	 	33	 
	 
	 	 	 	9.1.3	 	Financial Status and Insolvency	 	 	34	 
	 
	 	 	 	9.1.4	 	Breach of Representation or Warranty	 	 	34	 
	 
	 	 	 	9.1.5	 	Defaults under Other Agreements	 	 	34	 
	 
	 	 	 	9.1.6	 	Change of Control	 	 	35	 
	 
	 	 	 	9.1.7	 	Judgments	 	 	35	 
	 
	 	9.2	 	 	 	Grace Periods and Notice	 	 	35	 
	 
	 	 	 	9.2.1	 	No Notice or Grace Period	 	 	35	 
	 
	 	 	 	9.2.2	 	Nonpayment of Interest and Principal	 	 	35	 
	 
	 	 	 	9.2.3	 	Other Monetary Defaults	 	 	35	 
	 
	 	 	 	9.2.4	 	Nonmonetary Defaults Capable of Cure	 	 	36	 
	 
	 	9.3	 	 	 	Certain Remedies	 	 	36	 
	 
	 	 	 	9.3.1	 	Termination of Commitments	 	 	36	 
	 
	 	 	 	9.3.2	 	Accelerate Debt	 	 	36	 
	 
	 	 	 	9.3.3	 	Pursue Remedies	 	 	36	 
	 
	 	 	 	9.3.4	 	Written Waivers	 	 	36	 
	 
	 	 	 	9.3.5	 	Reserved	 	 	36	 
	 
	 	 	 	9.3.6	 	Enforcement of Rights	 	 	36	 
	10.
	 	 	 	 	 	SECURITY INTEREST AND SET-OFF	 	 	37	 
	 
	 	10.1	 	 	 	Security Interest	 	 	37	 
	 
	 	10.2	 	 	 	Set-Off and Debit	 	 	37	 
	 
	 	10.3	 	 	 	Right to Freeze	 	 	38	 
	 
	 	10.4	 	 	 	Additional Rights	 	 	38	 
	11.
	 	 	 	 	 	THE ADMINISTRATIVE AGENT AND THE LENDERS	 	 	38	 
	 
	 	11.1	 	 	 	Appointment of Administrative Agent	 	 	38	 
	 
	 	11.2	 	 	 	Administration of Facility by Administrative Agent	 	 	39	 
	 
	 	11.3	 	 	 	Delegation of Duties	 	 	39	 
	 
	 	11.4	 	 	 	Exculpatory Provisions	 	 	39	 
	 
	 	11.5	 	 	 	Reliance by Administrative Agent	 	 	40	 
	 
	 	11.6	 	 	 	Notice of Default	 	 	40	 
	 
	 	11.7	 	 	 	Lenders’ Credit Decisions	 	 	41	 
	 
	 	11.8	 	 	 	Administrative Agent’s Reimbursement and Indemnification	 	 	41	 
	 
	 	11.9	 	 	 	Administrative Agent in its Individual Capacity	 	 	41	 
	 
	 	11.10	 	 	 	Successor Administrative Agent	 	 	42	 
	 
	 	11.11	 	 	 	Duties in the Case of Enforcement	 	 	42	 
	 
	 	11.12	 	 	 	Respecting Loans and Payments	 	 	43	 
	 
	 	 	 	11.12.1	 	Procedures for Loans	 	 	43	 
	 
	 	 	 	11.12.2	 	Nature of Obligations of Lenders	 	 	43	 
	 
	 	 	 	11.12.3	 	Payments to Administrative Agent	 	 	44	 
	 
	 	 	 	11.12.4	 	Distribution of Liquidation Proceeds	 	 	44	 
	 
	 	 	 	11.12.5	 	Adjustments	 	 	45	 

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	 	 	 	 	 	 	 	 	Page	 
	 
	 	 	 	11.12.6	 	Setoff	 	 	45	 
	 
	 	 	 	11.12.7	 	Distribution by Administrative Agent	 	 	45	 
	 
	 	 	 	11.12.8	 	Actions by Administrative Agent	 	 	46	 
	 
	 	11.13	 	 	 	Delinquent Lender	 	 	46	 
	 
	 	11.14	 	 	 	Holders	 	 	47	 
	 
	 	11.15	 	 	 	Assignment and Participation	 	 	47	 
	 
	 	 	 	11.15.1	 	Conditions to Assignment by Lenders	 	 	47	 
	 
	 	 	 	11.15.2	 	Certain Representations and Warranties	 	 	48	 
	 
	 	 	 	11.15.3	 	Register	 	 	49	 
	 
	 	 	 	11.15.4	 	New Notes	 	 	49	 
	 
	 	 	 	11.15.5	 	Participations	 	 	50	 
	 
	 	11.16	 	 	 	Disclosure	 	 	50	 
	 
	 	11.17	 	 	 	Miscellaneous Assignment Provisions	 	 	50	 
	 
	 	11.18	 	 	 	Reserved	 	 	50	 
	 
	 	11.19	 	 	 	Amendment, Waiver, Consent, Etc.	 	 	50	 
	 
	 	11.20	 	 	 	Deemed Consent or Approval	 	 	52	 
	 
	 	11.21	 	 	 	Borrower Indemnification of Lenders	 	 	52	 
	 
	 	11.22	 	 	 	Borrower’s Communication with Lenders	 	 	53	 
	12.
	 	 	 	 	 	GENERAL PROVISIONS	 	 	53	 
	 
	 	12.1	 	 	 	Notices	 	 	53	 
	 
	 	12.2	 	 	 	Limitations on Assignment	 	 	55	 
	 
	 	12.3	 	 	 	Further Assurance	 	 	55	 
	 
	 	12.4	 	 	 	Parties Bound	 	 	55	 
	 
	 	12.5	 	 	 	Waivers and Extensions	 	 	55	 
	 
	 	12.6	 	 	 	Governing Law; Consent to Jurisdiction; Mutual Waiver of Jury Trial	 	 	55	 
	 
	 	 	 	12.6.1	 	Substantial Relationship	 	 	55	 
	 
	 	 	 	12.6.2	 	Place of Delivery	 	 	56	 
	 
	 	 	 	12.6.3	 	Governing Law	 	 	56	 
	 
	 	 	 	12.6.4	 	Consent to Jurisdiction	 	 	56	 
	 
	 	 	 	12.6.5	 	JURY TRIAL WAIVER	 	 	56	 
	 
	 	12.7	 	 	 	Survival	 	 	56	 
	 
	 	12.8	 	 	 	Cumulative Rights	 	 	56	 
	 
	 	12.9	 	 	 	Claims Against Administrative Agent or the Lenders	 	 	57	 
	 
	 	 	 	12.9.1	 	Borrower Must Notify	 	 	57	 
	 
	 	 	 	12.9.2	 	Remedies	 	 	57	 
	 
	 	 	 	12.9.3	 	Limitations	 	 	57	 
	 
	 	12.10	 	 	 	Obligations Absolute	 	 	57	 
	 
	 	12.11	 	 	 	Table of Contents, Title and Headings; Exhibits and Schedules	 	 	58	 
	 
	 	12.12	 	 	 	Counterparts	 	 	58	 
	 
	 	12.13	 	 	 	Integration	 	 	58	 
	 
	 	12.14	 	 	 	Time Of the Essence	 	 	58	 
	 
	 	12.15	 	 	 	No Oral Change	 	 	58	 
	 
	 	12.16	 	 	 	Monthly Statements	 	 	58	 
	 
	 	12.17	 	 	 	Indemnification	 	 	59	 

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Exhibit 10.60

	 	 	 
	Exhibits to Agreement:

	 	Section Reference Number
	 

	 	 
	 
	 	 
	 

	 	Section

	 	 	 	 	 
	 
	 	 	 	Reference Number
	 
	 	 	 
	 
	 	 	 	 
	Exhibit A
	 	Definitions	 	1.1
	 
	 	 	 	 
	Exhibit B
	 	Assets, Funded Debt; Subsidiaries	 	6.13, 6.16, 6.18, 7.2.13 and 7.5
	 
	 	 	 	 
	Exhibit C
	 	Authorized Representatives	 	4
	 
	 	 	 	 
	Exhibit D
	 	Form of Assignment and Acceptance	 	11.15.1
	 
	 	 	 	 
	Exhibit E
	 	Lenders' Commitment	 	2.1(a)
	 
	 	 	 	 
	Exhibit F
	 	Form of Note	 	2.1(b)
	 
	 	 	 	 
	Exhibit G
	 	Form of Certificate	 	7.2.6
	 
	 	 	 	 
	Exhibit H
	 	Intentionally omitted	 	 
	 
	 	 	 	 
	Exhibit I
	 	Form of Notice of Borrowing	 	2.1(c)
	 
	 	 	 	 
	Exhibit J
	 	Environmental Notices	 	6.15
	 
	 	 	 	 
	Exhibit K
	 	Portfolio Investment Entities	 	3.2
	 
	 	 	 	 
	Exhibit L
	 	Pro Forma Paydown Calculation	 	3.2

 

 

TERM LOAN AGREEMENT

     This is a Term Loan Agreement (“Agreement”) made and entered into as of the 24th day of April
2006, by and between HINES REIT PROPERTIES, L.P., a Delaware limited partnership (the “Borrower”),
having an address at c/o Hines Interests Limited Partnership, 2800 Post Oak Blvd., Suite 5000,
Houston, Texas 77056, and KEYBANK NATIONAL ASSOCIATION, a national banking association having an
address at 127 Public Square, Cleveland, Ohio 44114, and the other lending institutions which may
become parties to this Agreement pursuant to Section 11.15 hereof (each, a “Lender” and
collectively the “Lenders”), and KeyBank National Association, as agent for itself and such other
lending institutions (the “Administrative Agent”).

WITNESSETH:

1. BACKGROUND.

	 	1.1	 	Defined Terms. Capitalized terms used in this Agreement are defined either
in Exhibit A, or in specific sections of this Agreement, or in another Credit Document,
as referenced in Exhibit A.
	 
	 	1.2	 	Borrower. Borrower is a limited partnership organized under the laws
of the State of Delaware, of which the sole general partner is Hines Real Estate
Investment Trust, Inc., a Maryland corporation.
	 
	 	1.3	 	Use of Loan Proceeds. Borrower has applied to Administrative Agent for
a loan of One Hundred Sixty-Five Million Dollars ($165,000,000) (the “Facility”) the
proceeds of which are to be used solely for the purposes of paying the Commitment Fee
and acquiring the Illinois Property.
	 
	 	1.4	 	Accounting Terms. Except as otherwise expressly provided herein, all
accounting terms used herein shall be interpreted, and all financial statements and
certificates and reports as to financial matters required to be delivered to the
Lenders hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with this
Agreement shall (except as otherwise expressly provided herein) be made by application
of GAAP applied on a basis consistent with the most recent annual or quarterly
financial statements and reports delivered pursuant to Section 7.2 (or, prior to the delivery of
the first financial statements pursuant to Section 7.2, consistent with the financial
statements dated December 31, 2005).

2. LOAN PROVISIONS.

	 	2.1	 	Amount of Facility.
	 
	 	(a)	 	Commitment. Subject to all of the terms, conditions and provisions of
this Agreement, each Lender agrees severally to make loans (each a “Loan” and,

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	 	 	 	collectively, the “Loans”) to the Borrower for the purposes herein set forth in an
aggregate amount up to such Lender’s Commitment Percentage of the Facility; provided,
however: (i) with regard to each Lender individually, such Lender’s outstanding Loans
shall not exceed such Lender’s Commitment Percentage of the Committed Amount and (ii)
with regard to the Lenders collectively, the aggregate principal amount of outstanding
Loans shall not exceed the Committed Amount.
	 
	 	(b)	 	Notes. The Loans shall be evidenced by duly executed promissory
note(s) of the Borrower to each Lender in the original principal amount of each
Lender’s Commitment Percentage of the Committed Amount; such notes shall be
substantially in the form of Exhibit F.
	 
	 	(c)	 	Loans. In order to request that Lenders make a Loan hereunder,
Borrower must submit a Notice of Borrowing in the form attached hereto as Exhibit
I to Administrative Agent at least three (3) Business Days prior to the date on
which the Loan is requested to be made (which shall be a Business Day) and shall also
submit to Administrative Agent a Notice of Rate Selection in accordance with Section
2.3.5. Provided that all conditions precedent thereto are satisfied, Lenders will use
commercially reasonable efforts to fund the requested Loan on such date.
	 
	 	2.2	 	Term of Facility. The Facility shall be for a term (“Term”) commencing
on the date hereof and ending on August 22, 2006 (“Maturity Date”).
	 
	 	2.3	 	Interest Rate and Payment Terms. Amounts outstanding under the
Facility shall be payable as to interest and principal in accordance with the
provisions of this Agreement. This Agreement also provides for interest at a Default
Rate, Late Charges and prepayment rights and fees. Any and all interest rate selection
and conversion provisions in this Agreement are to be administered by the
Administrative Agent and are to be allocated on a pro rata basis to the Note(s) held by
each Lender based upon such Lender’s Commitment Percentage.

2.3.1 Borrower’s Options. Principal amounts outstanding under the
Facility shall bear interest at the following rates, at Borrower’s selection,
subject to the conditions and limitations provided for in this Agreement: (i)
Variable Rate or (ii) Adjusted LIBOR Rate.

2.3.2 Selection To Be Made. Borrower shall select, and thereafter may
change the selection of, the applicable interest rate, from the alternatives
otherwise provided for in this Agreement, by giving Administrative Agent a Notice of
Rate Selection as provided in Section 2.3.5 hereof: (i) at least three (3) Business
Days prior to a Loan, (ii) on any Business Day on which Borrower desires to convert
an outstanding LIBOR Rate Loan to a Variable Rate Loan, or (iii) at least three (3)
Business Days before the date on which Borrower desires to convert an outstanding
Variable Rate Loan to a LIBOR Rate Loan or make any change with respect to an
outstanding LIBOR Rate Loan.

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2.3.3 Increased Costs. If due to any one or more of: (i) the
introduction of any applicable law or regulation or any change (other than any
change by way of imposition or increase of reserve requirements or imposition of a
Reserve Percentage already referred to in the definition of LIBOR Rate) in the
interpretation or application by any authority charged with the interpretation or
application of any law or regulation; or (ii) the compliance with any guideline or
request from any governmental central bank or other governmental authority, there
shall be an increase in the cost to Administrative Agent or any Lender of agreeing
to make or making, funding or maintaining LIBOR Loans, including without limitation
changes which affect or would affect the amount of capital or reserves required or
expected to be maintained by Administrative Agent or any Lender, with respect to all
or any portion of the Facility, or any corporation controlling (directly or
indirectly) Administrative Agent or any Lender, on account thereof, then, provided
that such increases in costs are not due to the fraud or gross negligence of
Administrative Agent or such Lender, Borrower from time to time shall, upon demand
by Administrative Agent, pay additional amounts sufficient to indemnify
Administrative Agent or such Lender against the increased cost; provided, however,
that such amounts shall be no greater than that which such Administrative Agent or
Lender is generally charging other borrowers similarly situated to the Borrower. If
at any time a Lender or Lenders other than the Administrative Agent shall make a
determination of increased cost, the Borrower may at any time during the period that
such increased cost is being charged to Borrower instruct such Lender or Lenders to
sell its or their commitments (with all Loans outstanding thereunder) to a bank to
be designated by the Borrower and approved by the Administrative Agent (such
approval not to be unreasonably withheld) at a price equal to all outstanding
principal and accrued and unpaid interest and fees thereunder and any other
outstanding obligations due to such Lender hereunder, provided, however, that such purchasing bank shall comply
with the provisions of Section 11 hereof. A certificate as to the amount of the
increased cost and the reason therefor submitted to Borrower by Administrative
Agent, in the absence of manifest error, shall be conclusive and binding for all
purposes.

2.3.4 Illegality. Notwithstanding any other provision of this
Agreement, if the introduction of, or a change in the interpretation of, any law,
treaty, statute, regulation or interpretation thereof shall make it unlawful, or any
central bank or government authority shall assert by directive, guideline or
otherwise, that it is unlawful for Administrative Agent or any Lender to make or
maintain LIBOR Loans or to continue to fund or maintain LIBOR Loans then, on written
notice thereof and demand by Administrative Agent to Borrower, (a) the obligation of
Administrative Agent and Lenders to make LIBOR Loans and to convert or continue any
Loan as a LIBOR Loan shall terminate and (b) Borrower shall convert all Loans
outstanding under the Facility into Variable Rate Loans until such time as such
Lender may again make, maintain, and fund LIBOR Loans.

     2.3.4.1 Treatment of Affected Loans. If the obligation of any Lender
to make LIBOR Loans shall be suspended pursuant to Section 2.3.4 hereof, such

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Lender’s LIBOR Loans shall be automatically converted into Variable Rate Loans on
the last day(s) of the then current Interest Period(s) for such LIBOR Loans or prior
thereto if and to the extent LIBOR Loans may not be maintained as a result of any
condition or event specified in Section 2.3.4 hereof and, unless and until such
Lender gives notice as provided below that the circumstances specified in Section
2.3.4 hereof 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 Variable 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 Variable Rate Loans, and all Variable
Rate Loans of such Lender that would otherwise be converted into LIBOR Loans shall
remain as Variable Rate Loans.

     If such Lender gives notice to the Borrower (with a copy to the Administrative
Agent) that the circumstances specified in Section 2.3.4 hereof that gave rise to
the conversion of such Lender’s LIBOR Loans to Variable Rate Loans pursuant to this
Section 2.3.4.1 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
outstanding, such Lender’s Variable 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, interest rate basis, and
Interest Periods) in accordance with such Lenders’ respective Commitment
Percentages.

     2.3.4.2 Taxes.

     (a) Any and all payments by the Borrower to or for the account of any Lender or
the Administrative Agent hereunder or under any other Credit Document shall be made
free and clear of and without deduction for any and all taxes, duties, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender and the Administrative Agent, taxes
imposed on its income, and franchise taxes imposed on it, by the jurisdiction under
the laws of which such Lender (or its Applicable Lending Office) or the
Administrative Agent (as the case may be) is organized or by the jurisdiction where
such Lender (or its applicable Lending Office) or the Administrative Agent has a
permanent establishment or office, or is engaged in a trade or business, or any
political subdivision of such jurisdiction (all such non-excluded taxes, duties,
levies, imposts, deductions, charges, withholdings, and liabilities being
hereinafter referred to as “Taxes”). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable under this Agreement or any
other Credit Document to any Lender or the Administrative

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Agent, (i) the sum payable shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section
2.3.4.2) such Lender or the Administrative Agent receives an amount equal to the sum
it would have received had no such deductions been made, (ii) the Borrower shall
make such deductions, (iii) the Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with applicable law,
and (iv) the Borrower shall furnish to the Administrative Agent, at its address
referred to in Section 12.1, the original or a certified copy of a receipt
evidencing payment thereof.

     (b) In addition, the Borrower agrees to pay any and all present or future stamp
or documentary taxes and any other excise or property taxes or charges or similar
levies which arise from any payment made under this Agreement or any other Credit
Document (hereinafter referred to as “Other Taxes”).

     (c) The Borrower agrees to indemnify each Lender and the Administrative Agent
for the full amount of Taxes and Other Taxes (including, without limitation, any
Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable
under this Section 2.3.4.2) paid by such Lender or the Administrative Agent (as the
case may be) and any liability (including penalties, interest, and expenses) arising therefrom or with respect thereto;
provided, however, that such amounts shall be no greater than the amounts which such
Administrative Agent or Lender is generally charging other borrowers similarly
situated to the Borrower.

     (d) Each Lender organized under the laws of a jurisdiction outside the United
States, on or prior to the date of its execution and delivery of this Agreement in
the case of each Lender listed on the signature pages hereof and on or prior to the
date on which it becomes a Lender in the case of each other Lender, and from time to
time thereafter if requested in writing by the Borrower or the Administrative Agent
(but only so long as such Lender remains lawfully able to do so), shall provide the
Borrower and the Administrative Agent with (i) Internal Revenue Service Forms
W-8ECI, W-8BEN, W-8IMY and W-9 (or their equivalent), as appropriate, or any
successor form prescribed by the Internal Revenue Service, certifying if appropriate
that such Lender is entitled to benefits under an income tax treaty to which the
United States is a party which reduces the rate of withholding tax on payments of
interest or certifying that the income receivable pursuant to this Agreement is
effectively connected with the conduct of a trade or business in the United States,
and (ii) any other form or certificate required by any taxing authority (including
any certificate required by Sections 871(h) and 881(c) of the Code), certifying that
such Lender is entitled to an exemption from or a reduced rate of tax on payments
pursuant to this Agreement or any of the other Credit Documents. If the form
provided by a Lender at the time such Lender first becomes a party to this Agreement
indicates a United States withholding tax rate in excess of zero, withholding tax at
such rate shall be considered excluded from the definition of Taxes set forth in
Section 2.3.4.2(a).

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     (e) For any period with respect to which a Lender has failed to provide the
Borrower and the Administrative Agent with the appropriate form pursuant to Section
2.3.4.2(d) (unless such failure is due to a change in treaty, law, or regulation
occurring subsequent to the date on which a form originally was required to be
provided), such Lender shall not be entitled to indemnification under Section
2.3.4.2(a) or 2.3.4.2(b) with respect to Taxes imposed by the United States;
provided, however, that should a Lender, which is otherwise exempt from or subject
to a reduced rate of Taxes, become subject to Taxes because of its failure to
deliver a form required hereunder, the Borrower shall, at such Lender’s sole cost
and expense, take such steps as such Lender shall reasonably request to assist such
Lender to recover such Taxes.

     (f) If the Borrower is required to pay additional amounts to or for the account
of any Lender pursuant to this Section 2.3.4.2, then such Lender will agree to use
reasonable efforts to change the jurisdiction of its Applicable Lending Office so as
to eliminate or reduce any such additional payment which may thereafter accrue if
such change, in the judgment of such Lender, is not otherwise disadvantageous to
such Lender.

     (g) Without prejudice to the survival of any other agreement of the Borrower
hereunder, the agreements and obligations of the Borrower contained in this Section
2.3.4.2 shall survive the repayment of the Loans and the other obligations under the
Credit Documents and the termination of the Commitments hereunder.

     2.3.4.3 Capital Adequacy. If any future law, governmental rule, regulation, policy,
guideline or directive or the interpretation thereof by a court or Governmental
Authority with appropriate jurisdiction affects the amount of capital required or
expected to be maintained by banks or bank holding companies and any Lender or the
Administrative Agent determines that the amount of capital required to be maintained by
it is increased by or based upon the existence of Loans made or deemed to be made
pursuant hereto, then such Lender or the Administrative Agent may notify the Borrower
of such fact, and the Borrower shall pay to such Lender or the Administrative Agent
from time to time, upon demand made by the Administrative Agent or such Lender, as an
additional fee payable hereunder, such amount as such Lender or the Administrative
Agent shall determine reasonably and in good faith and certify in a notice to the
Borrower to be an amount that will adequately compensate such Lender or Administrative
Agent in light of these circumstances for its increased costs of maintaining such
capital. Each Lender and the Administrative Agent shall allocate such cost increases
among its customers in good faith and on an equitable basis, and will not charge the
Borrower unless it is generally imposing a similar charge on its other similarly
situated borrowers.

2.3.5 Notice. A “Notice of Rate Selection” shall be a written notice, given
by cable, tested telex, facsimile transmission (with authorized signature), or by
telephone if immediately confirmed by such a written notice, from an Authorized
Representative of Borrower which: (i) is irrevocable; (ii) is received by

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Administrative Agent not later than 1:00 o’clock P.M. Eastern Time: (a) at least three
(3) Business Days prior to a Loan; or (b) if a LIBOR Rate is selected, at least three
(3) Business Days prior to the end of the current Interest Period to which such
selection is to apply; (c) if a Variable Rate is selected, on the first day of the
Interest Period to which it applies; and (iii) as to each selected interest rate
option, sets forth the aggregate principal amount(s) to which such interest rate
option(s) shall apply and the Interest Period(s) applicable to each LIBOR Loan.

2.3.6 If No Notice. If Borrower fails to timely select an interest rate
option in accordance with the foregoing prior to a new Loan or as to an expiring
Interest Period of an outstanding LIBOR Loan, then such new Loan and/or such
outstanding LIBOR Loan shall be deemed converted to a LIBOR Loan with an Interest
Period of one (1) month; provided, however, if a LIBOR Loan is not then available, any
such new Loan shall
be deemed to be a Variable Rate Loan, and on the last day of the applicable Interest
Period of any such outstanding LIBOR Loan all outstanding principal amounts thereon
shall be deemed converted to a Variable Rate Loan.

2.3.7 Telephonic Notice. Without in any way limiting Borrower’s obligation
to confirm in writing any telephonic notice, Administrative Agent may act without
liability upon the basis of telephonic notice, concerning interest rate selection only,
believed by Administrative Agent in good faith to be from Borrower prior to receipt of
written confirmation. In each case Borrower hereby waives the right to dispute
Administrative Agent’s record of the terms of such telephonic Notice of Rate Selection
in the absence of manifest error.

2.3.8 Limits On Options. Each LIBOR Loan or Variable Rate Loan shall be in
a minimum amount of $100,000. At no time shall there be outstanding a total of more
than six (6) LIBOR Loans at any time. If Borrower shall make more than one (1)
interest rate selection in any thirty (30) day period, excluding conversions of
outstanding Loans made at the end of an applicable Interest Period of any previously
outstanding LIBOR Loan, Administrative Agent may impose and Borrower shall pay a
reasonable processing fee for each such additional selection.

2.3.9 Payment and Calculation of Interest. Subject to the provisions of
Section 2.3.14, all interest shall be: (a) payable in arrears commencing on May 31,
2006 with payments to be made on each Interest Payment Date thereafter; and (b)
calculated on the basis of a 360 day year and the actual number of days elapsed.
Interest shall be computed from and including the first day of the applicable Interest
Period to, but excluding, the last day thereof.

     (i) Variable Rate Loans. During such periods as the Loans shall be comprised
in whole or in part of Variable Rate Loans, such Variable Rate Loans shall bear
interest at a per annum rate equal to the Variable Rate. Each change in the Prime
Rate or Adjusted Federal Funds Rate shall, as applicable, simultaneously change the
Variable Rate payable under this Agreement; and

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     (ii) LIBOR Loans. During such periods as the Loans shall be comprised in whole
or in part of LIBOR Loans, such LIBOR Loans shall bear interest at a per annum rate
equal to the Adjusted LIBOR Rate.

2.3.10 Voluntary and Mandatory Principal Payments.

	 	(a)	 	Voluntary Prepayments. The Borrower shall have the right to prepay
Loans in whole or in part at any time upon three (3) Business Days prior notice to
Administrative Agent without premium or penalty with respect to Variable Rate Loans
and, with respect to LIBOR Loans, subject to a Make-Whole Provision.
	 
	 	(b)	 	Mandatory Prepayments.

     (i) If at any time the aggregate principal amount of outstanding Loans shall
exceed the Committed Amount, the Borrower shall immediately prepay the outstanding
principal balance on the Loans in an amount sufficient to eliminate such excess
(such prepayments and any other payments designated as such herein, “Mandatory
Prepayments”).

     (ii) All amounts required to be paid pursuant to Section 2.3.10(b)(i) shall be
applied to the Loans. Within the parameters of the applications set forth above,
Mandatory Prepayments shall be applied first to Variable Rate Loans and then to
LIBOR Loans in direct order of Interest Period maturities. All prepayments under
this Section 2.3.10(b)(ii) applied to LIBOR Loans in accordance with the foregoing
shall be subject to a Make-Whole Provision.

2.3.11 Maturity. At Maturity all accrued interest, principal and other charges due
with respect to the Facility shall be due and payable in full and the principal balance
and such other charges, but not unpaid interest, shall continue to bear interest at the
Default Rate until so paid. The parties hereto hereby agree that, to the extent the
maximum loan amount is increased under the Senior Credit Facility pursuant to the terms
thereof, this Facility shall be repaid dollar for dollar in the amount of such increase
under the Senior Credit Facility.

2.3.12 Method of Payment; Date of Credit. All payments of interest, principal and
fees shall be made in lawful money of the United States in immediately available funds:
(a) by direct charge to an account of Borrower maintained with Administrative Agent
(or the then holder of the Facility), or (b) by wire transfer to Administrative Agent,
or (c) to such other bank or address as the holder of the Facility may designate in a
notice to Borrower. Payments shall be credited on the Business Day on which
immediately available funds are received prior to one o’clock P.M. Eastern Time;
payments received after one o’clock P.M. Eastern Time shall be credited on the next
Business Day, payments which are not in the form of immediately available funds shall
not be credited until such funds become immediately available to Administrative Agent.

2.3.13 Billings. Administrative Agent may submit monthly billings reflecting
payments due; however, any changes in the interest rate which occur between the

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date of billing and the due date may be reflected in the billing for a subsequent month.
Neither the failure of Administrative Agent to submit a billing nor any error in any
such billing shall excuse Borrower from the obligation to make full payment of all
Borrower’s payment obligations when due; provided, however, that Borrower shall not be considered
in breach of this Agreement to the extent that it makes payments in accordance with
such billings unless and until three (3) Business Days after Borrower’s receipt of
written notice from Administrative Agent of such error in billing.

2.3.14 Default Rate. Administrative Agent shall have the option of imposing, and
Borrower shall pay upon billing therefor, a default interest rate which is four percent
(4%) per annum above the Variable Rate (the “Default Rate”): (a) while any monetary
Default exists and is continuing, during that period between the due date and the date
of payment; (b) while any Event of Default exists, unless and until the Event of
Default is waived by Administrative Agent; and (c) after Maturity. Borrower’s right to
select pricing options shall cease upon the occurrence and during the continuance of a
monetary Default or any Event of Default.

2.3.15 Late Charges. Except with respect to payments due at Maturity (as to which
the Late Charge shall not be applicable), Borrower shall pay, upon billing therefor, a
“Late Charge” equal to five percent (5%) of the amount of any payment of principal,
interest, or both, which is not paid within ten (10) days of the due date thereof.
Late Charges are: (a) payable in addition to, and not in limitation of, the Default
Rate, (b) intended to compensate Administrative Agent for administrative and processing
costs incident to late payments, (c) are not interest, and (d) shall not be subject to
refund or rebate or credited against any other amount due.

2.3.16 Make Whole Provision. Borrower shall pay to Administrative Agent,
immediately upon request and notwithstanding any contrary provisions contained in any
of the Credit Documents, such amounts as shall be necessary to compensate each Lender
for the loss, cost or expense which it actually reasonably incurs as a result of (i)
any payment or prepayment, under any circumstances whatsoever, whether voluntary or
involuntary, of all or any portion of a LIBOR Loan on a date other than the last day of
the applicable Interest Period of such LIBOR Loan, (ii) the conversion, for any reason
whatsoever, whether voluntary or involuntary, of any LIBOR Loan on a date other than
the last day of the applicable Interest Period, (iii) the failure of all or a portion
of a Loan which was to have borne interest at the Adjusted LIBOR Rate pursuant to the
request of Borrower to be made under this Agreement (except as a result of a failure by
Administrative Agent or any Lender to fulfill Administrative Agent’s or such Lender’s
obligations to fund), or (iv) the failure of Borrower to borrow in accordance with any
request submitted by it for a LIBOR Loan (except as a result of a failure by
Administrative Agent or any Lender to fulfill such Administrative Agent’s or Lender’s
obligations to fund). Such amounts payable by Borrower shall be equal to any
administrative costs actually incurred plus any
amounts required to compensate for any loss, cost or expense reasonably incurred by
reason of the liquidation or re-employment of deposits or

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other funds acquired by any Lender to fund or maintain a LIBOR Loan, including, without limitation, the costs
associated with the cancellation of any interest rate hedge agreement.

	 	2.4	 	Fees. The Borrower agrees to pay to the Administrative Agent for the
benefit of the Lenders in immediately available funds on or before the Closing Date a
commitment fee (the “Commitment Fee”) in the amount agreed to by Borrower and the
Administrative Agent in the Fee Letter.

3. SECURITY FOR THE LOAN; LOAN AND SECURITY DOCUMENTS.

	 	3.1	 	Credit Documents and Security Documents. The Facility shall be made,
evidenced, administered, secured and governed by all of the terms, conditions and
provisions of the “Credit Documents”, each as the same may be hereafter modified or
amended, consisting of: (i) this Agreement; (ii) separate Notes in the form of
Exhibit F annexed hereto, with one Note being payable to each Lender in the
original principal amount equal to such Lender’s Commitment, such promissory notes to
be in the aggregate original principal amount of One Hundred Sixty-Five Million Dollars
($165,000,000.00); (iii) the Direction Letters, if any; (iv) the Fee Letter; (v) the
Environmental Indemnity; (vi) the Security Documents; (vii) the Guaranty; and (viii)
any and all other related agreements and documents issued or delivered hereunder or
thereunder or pursuant hereto or thereto executed to further evidence or secure the
Facility.
	 
	 	3.2	 	Collateral. (a) Administrative Agent and Lenders shall have a
perfected security interest in the Collateral at Closing and at all times prior to
Maturity, which security interest shall be subordinated only to the security interest
in the collateral securing the obligations under the Senior Credit Facility, except as
otherwise provided in this Agreement or the Pledge Agreement. With respect to each of
the Portfolio Investments in a Portfolio Investment Entity listed on Exhibit K,
Borrower will pledge to Administrative Agent and Lenders certain of Borrower’s right,
title and interest in and to each of the Portfolio Investments, as the same may be
modified from time to time in accordance with this Section 3.2. With respect to such
pledges, Borrower will execute and deliver on the Closing Date (i) the Pledge
Agreement, (ii) UCC-1 financing statements with respect to such pledges, and (iii) any
additional documents or instruments reasonably requested by Administrative Agent on
behalf of Lenders in order to evidence or perfect such pledges, with all such documents
to be in form and substance acceptable to Administrative Agent on behalf of Lenders.
	 
	 	(b)	 	Borrower hereby authorizes Administrative Agent at any time and from time to
time to file UCC financing statements, continuation statements, and amendments thereto
describing the Collateral without the signature of Borrower. Administrative Agent
shall give Borrower prompt written notice of any such filing.

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	 	(c)	 	As provided in Section 7.2.8, Borrower shall give written notice to
Administrative Agent prior to the making of any Portfolio Disposition by Borrower or
any of its Subsidiaries, which notice shall be accompanied by a written certification
by Borrower in the form of Exhibit L attached hereto stating that Borrower will
be in full compliance with all covenants contained herein or in the other Credit
Documents, including without limitation the covenants set forth in Section 7.3, after
giving effect to the proposed Portfolio Disposition, and which notice shall be
accompanied by evidence of such compliance satisfactory to Administrative Agent on
behalf of Lenders. Borrower shall give written notice to Administrative Agent upon its
acquisition of any new Portfolio Investment.
	 
	 	(d)	 	Administrative Agent shall be authorized and obligated to release, within three
(3) Business Days after receipt of a written request from Borrower, any of the
Portfolio Investments from any security interests, liens or other encumbrances under
the Pledge Agreement or any other Security Document that is the subject of a proposed
Portfolio Disposition in compliance with the conditions set forth in this Section 3.2
(each, a “Permitted Portfolio Disposition”). Within three (3) Business Days after
receipt of a written request from Borrower, Administrative Agent on behalf of Lenders
will execute and deliver such instruments as are reasonably required to confirm the
release of the security interest, lien and/or other encumbrance of Administrative Agent
and Lenders with respect to such Portfolio Investment (which release may be concurrent
with and conditioned on the consummation of such Permitted Portfolio Disposition) (i)
that is the subject of a Permitted Portfolio Disposition or (ii) with respect to which
Administrative Agent on behalf of Lenders has otherwise released its security interest,
including UCC-3 partial releases.
	 
	 	(e)	 	Each new Portfolio Investment made by Borrower after the date hereof shall
automatically become a part of the Collateral, and, upon any such addition to the
Collateral, Borrower shall execute and deliver or cause to be delivered such Security
Documents and additional documents or instruments reasonably requested by
Administrative Agent with respect to the new Collateral, with all such documents to be
in form and substance reasonably acceptable to Administrative Agent; provided,
however, that, if the terms of any third party financing proposed to be obtained in
connection with the acquisition of a Portfolio Asset relating to a Portfolio Investment
would prohibit the Borrower from pledging in favor of Administrative Agent and the
Lenders 100% of a Portfolio Investment, then Borrower shall be required to pledge only
that portion of such Portfolio Investment permitted to be pledged under such financing
(and, in each case, to the greatest extent so permitted); provided further
however, that in no event shall Borrower pledge less than 49% of any such Portfolio
Investment without the consent of Administrative Agent, such consent not to be
unreasonably withheld or delayed.
	 
	 	(f)	 	Subject to Section 3.2(g) below, and provided that Borrower is in compliance
with the financial covenants contained in Section 7.3 of this Agreement and an Event of
Default does not exist, and provided that Borrower complies with the provisions of
Section 7.2.6 of this Agreement with respect to any proposed Portfolio Disposition,
Borrower may make and may cause its Subsidiaries to make Portfolio Dispositions.

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	 	(g)	 	If Borrower’s Consolidated Leverage Ratio exceeds seventy percent (70%) after
giving effect to such Portfolio Disposition, Borrower shall reduce the outstanding
aggregate principal amount of the Loans by the amount necessary to maintain compliance
with Borrower’s covenants contained herein or in the other Credit Documents, including
without limitation the covenants set forth in Section 7.3. The foregoing reductions in
the outstanding aggregate principal amount of the Loans are collectively referred to
herein as a “Required Reduction.” Any Required Reduction shall not reduce the
Maximum Loan Amount. Any Required Reduction shall be calculated based on the Pro Forma
Reduction Calculation attached hereto as Exhibit L. The Total Asset Value of
any Portfolio Investment used for the purpose of making the calculation of the Required
Reduction under this Section 3.2(g) shall be based on the most recent Appraised Asset
Values of the Portfolio Assets associated with such Portfolio Investment.
	 
	 	(h)	 	Notwithstanding the foregoing or anything contained herein to the contrary, (A)
after an Event of Default and while such Event of Default is continuing, (B) if an
Event of Default is created as a result of a Portfolio Disposition, or (C) if a
Portfolio Disposition results in Borrower not being in compliance with any of
Borrower’s covenants set forth in Section 7.3 (other than the Consolidated Leverage
Ratio requirement set forth in Section 7.3(a)), then one hundred percent (100%) of Net
Sales Proceeds (or so much of such Net Sales Proceeds as is required to cure such Event
of Default or to bring Borrower into compliance with Borrower’s covenants set forth in
Section 7.3, as applicable) shall be applied to reduce the outstanding aggregate
principal amount of the Loans and there shall be a corresponding Required Reduction;
provided, however, if the Consolidated Leverage Ratio is greater than
seventy percent (70%) and there is no Event of Default (including as a result of a
Portfolio Disposition) and Borrower is otherwise in compliance with Borrower’s
covenants set forth in Section 7.3, the provisions of Section 3.2(g) shall apply to
Portfolio Dispositions and Borrower shall not be required to apply Net Sales Proceeds
to reduce the outstanding aggregate principal amount of the Loans as provided in this
Section 3.2(h).
	 
	 	(i)	 	All Required Reductions made by Borrower pursuant to Sections 3.2(g) and 3.2(h)
shall constitute “Mandatory Prepayments” subject to the provisions of Section
2.3.10(b).
	 
	 	3.3	 	Borrower Escrow Account.(i) Borrower shall place funds in a Borrower
Escrow Account as required by this Section 3.3; provided, however, that
the requirement for Borrower to place funds in a Borrower Escrow Account under this
Section 3.3 shall be subordinated to the obligations of Borrower under the Senior
Credit Facility to place funds in a borrower escrow account as additional collateral
for the obligations under the Senior Credit Facility. The Borrower Escrow Account
shall serve as additional collateral for the Facility and the Borrower Obligations.
	 
	 	(ii)	 	If an Event of Default occurs and is continuing, then, except as provided in
Section 7.9, Borrower shall deposit into the Borrower Escrow Account all Net Cash Flow
for the immediately preceding fiscal quarter that is Available for Distribution to

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	 	 	 	Borrower derived from any Portfolio Investment until such time that Borrower is in
compliance with all covenants of Borrower hereunder, including without limitation, the
covenants under Section 7.3. Deposits into the Borrower Escrow Account shall be made
within fifteen (15) days after the end of the fiscal quarter for which such deposit is
due and, to the extent sufficient information is not available to Borrower to make a
final determination of the amounts due on or before such fifteenth (15th)
day, a final payment (if necessary) shall be made on or before the forty-fifth
(45th) day following the end of such quarter.
	 
	 	(iii)	 	If Borrower is required to deposit funds into the Borrower Escrow Account and
thereafter Borrower is able to provide written evidence reasonably satisfactory to
Administrative Agent on behalf of Lenders that no Event of Default currently exists,
then (a) so long as no Default or Event of Default shall have occurred and be
continuing, the balance remaining in the Borrower Escrow Account (including any income
earned on amounts deposited in the Borrower Escrow Account), if any, shall be disbursed
to Borrower or as Borrower shall otherwise direct Administrative Agent in writing. The
written evidence of such compliance referred to in the preceding sentence will be
deemed satisfactory and approved by the Administrative Agent on behalf of Lenders
unless written notice outlining the reason for disapproval is received by Borrower from
the Administrative Agent within ten (10) Business Days of receipt by the Administrative
Agent of first notice of such compliance.
	 
	 	(iv)	 	Administrative Agent may, during the existence and continuation of an Event of
Default and on the Maturity Date, and, at the request of Borrower on any Interest
Payment Date, Administrative Agent will apply all amounts existing in the Borrower
Escrow Account (including any income earned on amounts deposited in the Borrower Escrow
Account) as follows: (i) first, to accrued but unpaid interest of the Loans
outstanding, and (ii) second, to a reduction of the principal amount on the Loans
outstanding and all other amounts due and owing under this Agreement; provided that,
with respect to any amounts remaining in the Borrower Escrow Account subsequent to any
Interest Payment Date, such amounts may be applied by Administrative Agent only to the
principal balance of the Loans, and not to any future interest payments (until the next
subsequent Interest Payment Date). After the principal amount of the Loans, all accrued
and unpaid interest and all other amounts owing under the Credit Documents have been
paid in full and all commitments under the Credit Documents have been terminated, the Borrower Escrow
Account shall be closed and the balance remaining (including any income earned
thereon), if any, shall be returned to Borrower.
	 
	 	 	 	If Borrower is required to deposit funds into the Borrower Escrow Account for two
consecutive fiscal quarters, then Administrative Agent shall have the right on and
after the date that the second quarterly deposit is due to deliver the Direction
Letters to the addressees named thereon. Administrative Agent shall not deliver the
Direction Letters prior to such date.

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4. CONTINUING AUTHORITY OF AUTHORIZED REPRESENTATIVES. The Borrower has the power and
authority to enter into this Agreement and the other Credit Documents and to perform its
obligations under and consummate the transactions contemplated by such Credit Documents and has by
proper action duly authorized the execution and delivery of the Credit Documents. Administrative
Agent and each of the Lenders is authorized to rely upon the continuing authority of the persons,
officers, signatories or agents hereafter designated (“Authorized Representatives”) to bind
Borrower with respect to all matters pertaining to the Facility and the Credit Documents including,
but not limited to, the selection of interest rates. Such authorization may be changed only upon
notice to Administrative Agent accompanied by evidence, reasonably satisfactory to Administrative
Agent, of the authority of the person giving such notice and such notice shall be effective not
sooner than five (5) Business Days following receipt thereof by Administrative Agent. The present
Authorized Representatives are listed on Exhibit C.

5. CONDITIONS PRECEDENT. The obligation of Administrative Agent and Lenders to enter into
this Agreement and to make the Loan on the Closing Date shall be subject to satisfaction of the
following conditions (in form and substance acceptable to the Lenders):

	 	5.1	 	Satisfactory Credit Documents. Each of the Credit Documents shall be
satisfactory in form, content and manner of execution and delivery to Administrative
Agent and Administrative Agent’s counsel.
	 
	 	5.2	 	No Material Change. No change shall have occurred in the condition
(financial or otherwise), business, affairs, operations or control of Borrower or any
other member of the Combined Group, the General Partner, or any Portfolio Investment
Entity, which would have a Material Adverse Effect since the date of Borrower’s
financial statements most recently delivered to Administrative Agent.
	 
	 	5.3	 	Warranties and Representations Accurate. All warranties and
representations made by or on behalf of Borrower and the General Partner to
Administrative Agent or any Lender shall be true, accurate and complete in all material
respects.
	 
	 	5.4	 	Financials and Appraisals. Administrative Agent on behalf of the
Lenders shall have received and approved: (i) consolidated financial statements of
General Partner complying with the standards set forth in Section 7.2, and (ii) a
statement of Appraised Asset Value dated as of a recent date for the Portfolio Assets,
which indicates Borrower’s Pro Rata Share of each Portfolio Asset.
	 
	 	5.5	 	Environmental Compliance and Indemnification Agreements. The Borrower
will execute and deliver a compliance and indemnification agreement with respect to
environmental matters in favor of Administrative Agent and Lenders with respect to any
assets owned directly or indirectly by the Borrower (“Environmental Indemnity”).
	 
	 	5.6	 	Validity and Sufficiency of Security Documents. Each of the Security
Documents and related UCC filings shall have been duly recorded and filed to the
satisfaction of Administrative Agent, and Administrative Agent’s counsel, and the
Security

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	 	 	 	 Documents, upon the filing and recordation of the UCC filing statements, shall
create a perfected lien on the Collateral.
	 
	 	5.7	 	No Other Liens; Taxes and Municipal Charges Current. The Collateral
shall not be subject to any liens or encumbrances other than real estate taxes and
personal property taxes not yet due and payable and other Permitted Liens, unless such
liens or encumbrances have been approved by Administrative Agent and Lenders. All real
estate taxes, personal property taxes and other municipal charges relating to any of
the Collateral shall be current.
	 
	 	5.8	 	Organizational Documents and Entity Agreements. Administrative Agent
shall have received and approved the Partnership Agreement or other organizational
documents of Borrower and of the other members of the Combined Group and the General
Partner, and certificates of good standing and/or legal existence for the Borrower,
General Partner and each affiliate of Borrower who is executing and delivering a Credit
Document issued as of a recent date by such entity’s state of organization and each
other state where such entity, by the nature of its business, is required to qualify or
register.
	 
	 	5.9	 	Votes, Consents and Authorizations. Administrative Agent shall have
received and approved certified copies of all partnership, trust, entity and corporate
votes, consents and authorizations as may be
reasonably required to evidence authority for: (i) closing the Facility and the
transactions contemplated hereby; (ii) providing continuing authorization to
designated persons to deal in all respects on behalf of Borrower; and (iii) the
execution of all Credit Documents.
	 
	 	5.10	 	Legal and Other Opinions. Administrative Agent shall have received and
approved legal opinion letters from counsel representing Borrower and the General
Partner which meet Administrative Agent’s legal opinion requirements.
	 
	 	5.11	 	Due Diligence. Completion and approval of all due diligence deemed
necessary by the Administrative Agent.
	 
	 	5.12	 	Fees and Expenses. Payment of all fees and expenses owing to the
Lenders and the Administrative Agent in accordance with the Fee Letter.
	 
	 	5.13	 	Guaranty. The Guarantor will execute and deliver to Administrative
Agent, for the benefit of the Lenders, the Guaranty.
	 
	 	5.14	 	No Default. There shall not be any Default or Event of Default under
any of the Credit Documents.
	 
	 	5.15	 	No Litigation. There shall not be any action, suit, investigation or
proceeding, pending or threatened, in any court or before any arbitrator or
governmental authority, that has a reasonable probability of materially adversely
effecting the ability of the Borrower to perform its obligations under this Agreement
or the other Credit Documents.

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	 	5.16	 	Compliance with Covenants. The Borrower shall be in compliance with
all covenants contained herein and in the other Credit Documents.
	 
	 	5.17	 	Other. Receipt by the Administrative Agent of such other information
and documentation as reasonably requested by the Administrative Agent.

	6.	 	WARRANTIES AND REPRESENTATIONS. Borrower warrants and represents to
Administrative Agent and each of the Lenders for the express purpose of inducing the
Lenders to enter into this Agreement, to make the Facility available to the Borrower,
to make the Loan, and to otherwise complete all of the transactions contemplated
hereby, that as of the date of this Agreement, upon the date any Loan is funded and at
all times thereafter until such Loan has been repaid and all obligations to each of the
Lenders have been satisfied as follows:

	 	6.1	 	Financial Information. Borrower has heretofore delivered to
Administrative Agent on behalf of the Lenders audited financial statements for General
Partner for the period ended December 31, 2005. Such financial statements were true,
accurate and complete in all material respects, and fairly presented, in all material
respects, the financial condition of General Partner and the Borrower, as of the dates
thereof and for the periods covered thereby, and the same were prepared in accordance
with GAAP. Since the date of the most recent financial statements so delivered, there
have occurred no changes or circumstances which have had or will have a Material
Adverse Effect. All financial statements of General Partner hereafter delivered to
Administrative Agent on behalf of the Lenders shall be true, accurate and complete in
all material respects, and such financial statements shall fairly present in all
material respects the financial condition of General Partner and the Borrower as of the
dates thereof and for the periods covered thereby.
	 
	 	 	 	Borrower has heretofore delivered an operating report to Administrative Agent on
behalf of the Lenders for each Portfolio Asset. Each such operating report presents,
in all material respects, a true, accurate, and complete report of all material
operating expenses and operating revenues of the Portfolio Asset to which it relates
for the period covered by such report. Each such operating report hereafter delivered
to the Administrative Agent on behalf of the Lenders in respect of any Portfolio Asset
shall present, in all material respects, a true, accurate, and complete report of all
material operating expenses and operating revenues of such Portfolio Asset for the
period covered by such report.
	 
	 	6.2	 	No Violations. Neither the execution and delivery of the Credit
Documents by the Borrower, nor the consummation by the Borrower of the transactions
contemplated therein, nor performance of and compliance with the terms and provisions
thereof by the Borrower will (i) violate or conflict with any provision of the
organizational documents or other governance documents of the Borrower or any other
member of the Combined Group, (ii) violate any law, regulation (including without
limitation Regulation U, Regulation X or Regulation T), order, writ, judgment,
injunction, decree or permit applicable to the Borrower (iii) violate or materially
conflict with contractual provisions of, or cause an event of default under, any
indenture,

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	 	 	 	mortgage, deed of trust, contract or other agreement or instrument to which any member
of the Combined Group is a party or by which any such Person may be bound, or (iv)
except for Liens created by, under or in connection with this Agreement or the other
Credit Documents, result in or require the creation of any lien, security interest or
other charge or encumbrance upon or with respect to the Portfolio Investments of the
Borrower or any interest in a Portfolio Asset held by a member of the Combined Group.
	 
	 	6.3	 	No Litigation. There is no litigation, action, proceeding,
investigation or suit now pending, or to the best of Borrower’s knowledge threatened,
against Borrower, a Portfolio Investment Entity, or any other member of the Combined
Group which, if adversely decided, would have a Material Adverse Effect.
	 
	 	6.4	 	Compliance With Legal Requirements. The Borrower, any Additional
Pledgor and each other member of the Combined Group is in compliance in all material
respects with all laws, rules, regulations, orders and decrees (including without
limitation Environmental Laws) applicable to it, or to its properties, unless such
failure to comply would not have or would not be reasonably expected to have a Material
Adverse Effect.
	 
	 	6.5	 	Use of Proceeds. The proceeds of any Loan shall be used solely for the
purposes described in Section 1.3 above.
	 
	 	6.6	 	Entity Matters.

6.6.1 Borrower. Borrower: (a) is a limited partnership duly organized,
validly existing and in good standing under the laws of the State of Delaware, (b)
has all necessary power pursuant to proper authorization to enable it to enter into
the Credit Documents to which it is a party, (c) is duly qualified as a foreign
entity and in good standing under the laws of each jurisdiction where the failure to
do so could have a Material Adverse Effect and (d) has the limited partnership power
and authority, and the legal right to conduct the business in which it is currently
engaged.

6.6.2 General Partner. The General Partner (a) is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Maryland, (b) has all necessary power pursuant to proper authorization to enable it
to act as the general
partner of Borrower and to execute and deliver the Credit Documents to which
Borrower is a party on Borrower’s behalf, (c) is duly qualified to do business in
and is in good standing under the laws of each jurisdiction where the failure to do
so could have a Material Adverse Effect, and (d) has the corporate power and
authority, and the legal right, to conduct the business in which it is currently
engaged.

6.6.3 Identity of General Partner. As of the date of this Agreement,
the sole General Partner of Borrower is Hines Real Estate Investment Trust, Inc., a
Maryland corporation.

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	 	6.7	 	Valid and Binding. Each of the Credit Documents to which it is a party
constitutes the legal, valid and binding obligations of Borrower; and the Partnership
Agreement constitutes the legal, valid and binding obligations of the parties thereto,
in each case enforceable against the relevant Person in accordance with the respective
terms thereof, subject to bankruptcy, insolvency and similar laws of general
application affecting the rights and remedies of creditors and, with respect to the
availability of the remedies of specific enforcement, subject to the discretion of the
court before which any proceeding therefor may be brought. All required entity actions
and proceedings have been duly taken with respect to Borrower and the General Partner
and each Portfolio Investment Entity, so as to authorize the execution, delivery and
performance by Borrower of the Credit Documents to which it is a party. All consents
and approvals that are required in connection with the execution and delivery of this
Agreement and the other Credit Documents have been obtained, including, without
limitation, consents and approvals required under existing mortgage and loan
agreements, organizational agreements, and from Governmental Authorities.
	 
	 	6.8	 	Deferred Compensation and ERISA. Borrower has not established and does
not plan to establish any pension, insurance or other arrangement or plan for employees
covered by Title IV of the Employee Retirement Income Security Act of 1974, as now or
hereafter amended (“ERISA”), and no “Reportable Event” as defined in ERISA has occurred
and is now continuing with respect to any Plan. The granting of the Facility, the
performance by Borrower of its obligations under the Credit Documents to which it is a
party and Borrower’s conducting of its operations do not and will not violate any
provisions of ERISA.
	 
	 	6.9	 	No Material Change; No Default. Neither Borrower, the General Partner,
any other member of the Combined Group, nor, to the best knowledge of Borrower, any
Portfolio Investment Entity, is in default in any respect under any contract, lease,
agreement, indenture, mortgage, security agreement or other agreement or obligation to
which it is a party which default
would have or would be reasonably expected to have a Material Adverse Effect. No
Default or Event of Default presently exists hereunder or under any other Credit
Document to which Borrower is a party. Borrower, the General Partner, each other
member of the Combined Group and, to the best knowledge of Borrower, each Portfolio
Investment Entity has filed all required federal, state and local tax returns and has
paid all taxes due pursuant to such returns or any assessments against any of them.
As of the Closing Date, no change has occurred with respect to Borrower, the General
Partner, or to the best knowledge of Borrower, any Portfolio Investment Entity, any
Portfolio Asset or any Portfolio Investment, that would reasonably be expected to have
a Material Adverse Effect since December 31, 2005. The Partnership Agreement, a true
and correct copy of which has been provided to the Administrative Agent, is in full
force and effect.
	 
	 	6.10	 	No Broker or Finder. Neither Borrower nor anyone on behalf thereof,
has dealt with any broker, finder or other person or entity who or which may be
entitled to a broker’s or finder’s fee, or other compensation, payable by
Administrative Agent or 

-19-

 

	 	 	 	any Lender in connection with the Facility; it being understood
however, that a broker has been engaged by Borrower in connection with the Facility and
other financings which will not result in a fee or compensation payable by the
Administrative Agent or any Lender.

	 	6.11	 	Background Information and Certificates. Borrower has delivered to
Administrative Agent accurate and complete copies of all the organizational documents
of the Borrower, the General Partner, any other member of the Combined Group and each
Portfolio Investment Entity. To the best knowledge of the Borrower, all of the factual
information contained or referred to in this Agreement and in the Exhibits and/or
Schedules to this Agreement or the other Credit Documents, and in the certificates and
opinions furnished to Administrative Agent or any Lender by or on behalf of Borrower in
connection with the Facility, is true and correct in all material respects.
	 
	 	6.12	 	Consents. Except to the extent previously obtained, no consent,
approval, authorization or order of, or filing, registration or qualification with, any
court or governmental authority or other Person is required in connection with the
execution, delivery or performance of this Agreement or any of the other Credit
Documents to which Borrower is a party, including without limitation, consents and
approvals required under existing mortgage and loan agreements, organizational
agreements, and from Governmental Authorities.
	 
	 	6.13	 	Indebtedness. Except as permitted under Section 7.4, the Borrower does
not have any Indebtedness. All Funded Debt outstanding as of the Closing Date is
accurately reflected on Exhibit B.
	 
	 	6.14	 	Government Regulation. The Borrower is not subject to regulation under
the Public Utility Holding Company Act of 1935 or the Federal Power Act, each as
amended. In addition, the Borrower is not (i) an “investment company” registered or
required to be registered under the Investment Company Act of 1940, as amended, and is
not controlled by such a company, or (ii) a “holding company,” or a “Subsidiary
company” of a “holding company,” or an “affiliate” of a “holding company” or of a
“Subsidiary” or a “holding company,” within the meaning of the Public Utility Holding
Company Act of 1935, as amended.
	 
	 	6.15	 	Environmental Matters.
	 
	 	(a)	 	Except as would not result or be reasonably expected to result in a Material
Adverse Effect:
	 
	 	(i)	 	Except as disclosed on Exhibit J attached hereto and made a part
hereof, neither the Borrower, the General Partner, any other member of the Combined
Group nor, to the knowledge of the Borrower any Portfolio Investment Entity, has
received any written notice of, or inquiry from any Governmental Authority regarding,
any violation, alleged violation, non-compliance, liability or potential liability
regarding Hazardous Materials or compliance with Environmental Laws with regard to any
of 

-20-

 

	 	 	 	the Portfolio Assets nor does the Borrower have knowledge that any such notice is
being threatened.

	 	(ii)	 	No judicial proceeding or governmental or administrative action is pending or,
to the knowledge of the Borrower, threatened, under any Environmental Law to which the
Borrower, the General Partner, any other member of the Combined Group, or, to the
knowledge of the Borrower, any Portfolio Investment Entity is or will be named as a
responsible party, nor are there any consent or other decrees, remediation orders,
administrative or other orders, or other similar administrative or judicial
requirements outstanding under any Environmental Law with respect to the Borrower, the
General Partner, any other member of the Combined Group, or, to the knowledge of the
Borrower, any Portfolio Investment Entity or any of the Portfolio Assets.
	 
	 	(iii)	 	Neither the Borrower, the General Partner, any other member of the Combined
Group, nor, to the knowledge of the Borrower, any Portfolio Investment Entity, has
assumed any liability of any Person under any Environmental Law.
	 
	 	6.16	 	Portfolio Assets. Set forth on Exhibit B is a complete and
accurate list of all Portfolio Assets existing as of the Closing Date, together with
the ownership interest (both direct and indirect) of the Borrower therein, and together
with a list of the existing documents evidencing Funded Debt currently encumbering the
same (which sets forth the
names of the parties, the dates of such documents, and the amount of Funded Debt
relating to each such document) (collectively, the “Funded Debt Documents”). Except
for mandatory prepayments of Funded Debt upon the sale of Portfolio Assets, upon the
maturity (whether at the stated maturity date or upon acceleration) of any Funded Debt
or in connection with a default continuing beyond any applicable notice and/or cure
period under the Funded Debt Documents, there are no restrictions or limitations
(whether by contract or otherwise), except those arising under the Senior Credit
Facility, on payments of dividends, returns of capital or any other forms of
distributions from any Portfolio Investment Entity or any member of the Combined Group
to the Borrower or any other member of the Combined Group.
	 
	 	6.17	 	Full Disclosure. All information heretofore furnished by or on behalf
of the Borrower to the Administrative Agent or any Lender for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and all such
information hereafter furnished by or on behalf of the Borrower to the Administrative
Agent or any Lender will be, true and accurate in all material respects on the date as
of which such information is stated (except to the extent any such information is
subsequently supplemented or corrected by information provided by or on behalf of
Borrower); provided, however, that where such information is the work product of a
third party that is unrelated to Borrower, such information is and will be, to the best
of Borrower’s knowledge, true and accurate in all material respects on the date as of
which information is stated. To the best of its knowledge, the Borrower has disclosed
to the Lenders in writing any and all facts which have had or might have in the future
a Material Adverse Effect.

-21-

 

	 	6.18	 	Subsidiaries. Borrower has no Subsidiaries other than those listed on
Exhibit B and no Lien other than Permitted Liens exists on Borrower’s interests
in its Subsidiaries.
	 
	 	6.19	 	No Material Adverse Contracts, Etc. Neither the Borrower, the General
Partner, any other member of the Combined Group nor, to the knowledge of the Borrower,
any Portfolio Investment Entity, is subject to any charter, corporate, partnership or
other legal restriction, or any judgment, decree, order, rule or regulation, or party
to any contract or agreement that has had or could reasonably be expected in the future
to have a Material Adverse Effect.
	 
	 	6.20	 	Compliance With Other Instruments, Laws, Etc. Neither the Borrower,
the General Partner, any other member of the Combined Group nor, to the knowledge of
the Borrower, any Portfolio Investment Entity, is in violation of any provision of its
partnership agreement, charter or other organizational document, as the case may be, or
any agreement or instrument to which it may be subject or by which it or any of its
properties may be bound or any
decree, order, judgment, statute, license, rule or regulation, in any of the foregoing
cases in a manner that could reasonably be expected to result, individually or in the
aggregate, in a Material Adverse Effect.
	 
	 	6.21	 	Solvency. Each member of the Combined Group, the General Partner, and
to the knowledge of the Borrower, each Portfolio Investment Entity, is Solvent.
	 
	 	6.22	 	REIT Status. The General Partner was organized and has operated in
conformity with the requirements for qualification and taxation as a REIT for each of
its taxable years beginning with the year ended December 31, 2004, and its current or
anticipated organization and method of operation will enable it to continue to meet the
requirements for qualification and taxation as a REIT.
	 
	 	6.23	 	Patriot Act. Neither Borrower, the General Partner, any other member
of the Combined Group nor, to the knowledge of the Borrower, any Portfolio Investment
Entity, is or shall become a person with whom Lender is restricted from doing business
under regulations of the Office of Foreign Asset Control (“OFAC”) of the Department of
the Treasury of the United States of America (including, without limitation, those
Persons named on OFAC’s Specially Designated and Blocked Persons list) or under
Executive Order 13324 — Blocking Property and Prohibiting Transactions With Persons
Who Commit, Threaten to Commit, or Support Terrorism, or any similar Executive Order or
other similar Legal Requirement, and neither Borrower, the General Partner, any other
member of the Combined Group nor, to the knowledge of the Borrower, any Portfolio
Investment Entity is knowingly engaged or shall knowingly engage in any dealings or
transactions or otherwise be associated with such persons.

-22-

 

	7.	 	COVENANTS.

     Borrower covenants and agrees that from the date hereof and so long as any indebtedness
remains unpaid hereunder, or any of the Loans or other obligations remain outstanding, as follows:

	 	7.1	 	Notices. Borrower shall, with reasonable promptness, but in all events
within ten (10) days after it has actual knowledge thereof, notify Administrative Agent
in writing of the occurrence of any act, event or condition which Borrower, in its good
faith determination, believes constitutes a Default or Event of Default under any of
the Credit Documents, specifying the nature and existence thereof. Such notification
shall include a written statement of any remedial or curative actions which Borrower
proposes to undertake to cure or remedy such Default or Event of Default.
	 
	 	7.2	 	Financial Statements and Reports. Borrower shall furnish or cause to
be furnished to Administrative Agent from time to time, the following financial
statements and reports and other information, all in form, manner of presentation and
substance reasonably acceptable to Administrative Agent:

7.2.1 Annual Statements. Within ninety (90) days following the end of
each fiscal year, a consolidated balance sheet, an income statement, a statement of
changes in shareholders’ equity and a statement of cash flows of the General Partner
as of the end of such fiscal year, setting forth in comparative form consolidated
figures for the preceding fiscal year, all such financial information described
above to be in reasonable form and detail and audited by one of the following
accounting firms: Deloitte & Touche LLP, Ernst & Young LLP, KPMG or
PricewaterhouseCoopers (or by another independent certified public accounting firm
of recognized national standing reasonably acceptable to the Administrative Agent),
and whose opinion shall be to the effect that such financial statements have been
prepared in accordance with GAAP and shall not be limited as to the scope of the
audit or qualified as to the status of the General Partner or the Borrower as a
going concern or otherwise;

7.2.2 Periodic Statements. Within forty-five (45) days following the
end of each fiscal quarter of the General Partner (other than the fourth fiscal
quarter, in which case ninety (90) days after the end thereof) an unaudited
consolidated balance sheet, income statement and statement of changes in
shareholders’ equity of the General Partner as of the end of such fiscal quarter, in
each case setting forth in comparative form consolidated figures for the
corresponding period of the preceding fiscal year, all such financial information
described above to be in reasonable form and detail and reasonably acceptable to the
Administrative Agent (provided, however, Administrative Agent hereby confirms that
the form and detail of such financial information, as well as any financial
information submitted by Borrower pursuant to Section 7.2.1 above, shall be deemed
to be acceptable if it is in substantially the same form and detail as the financial
information submitted by Borrower to Administrative Agent prior to the date

-23-

 

hereof), and accompanied by a certificate of an authorized officer of Borrower to the effect
that such quarterly financial statements fairly present in all material respects the
financial condition of the General Partner and have been prepared in accordance with
GAAP, subject to changes resulting from audit and normal year-end adjustments.

7.2.3 Data Requested. Within a reasonable period of time after a
request from Administrative Agent, such other financial data or information as
Administrative Agent may reasonably request with respect to any of the Portfolio
Assets or members of the Combined Group including, without limitation, operating
statements, budgets, mortgage information, rent rolls, and lease status/expiration
reports.

7.2.4 Tax Returns. Within a reasonable period of time after a request
from Administrative Agent, complete copies of all federal and state tax returns and
supporting schedules of Borrower, and, to the extent applicable each other member of
the Combined Group.

7.2.5 Pro Forma. Calculation of Certain Financial Covenants. Within
forty-five (45) days after the end of each fiscal quarter Borrower shall deliver a
pro forma calculation of the financial covenants contained in Section 7.3.

7.2.6 Officer’s Certificate. (A) At the time of delivery of the
financial statements provided for in Sections 7.2.1 and 7.2.2 above, (B) at least
fourteen (14) days prior to any sale, disposition or other transfer of a Portfolio
Asset (or any material part thereof, other than the leasing of space in Portfolio
Assets to tenants in the ordinary course of business), and (C) at the time Borrower
requests a new Loan hereunder or repays any principal amount outstanding under the
Facility, Borrower shall deliver a certificate of an authorized officer of Borrower
substantially in the form of Exhibit G, (i) demonstrating compliance with
the financial covenants contained in Section 7.3 by calculation thereof as of the
end of each such fiscal period or after giving effect to such transfer, borrowing or
repayment (together with such supporting documentation as Administrative Agent may
reasonably require), and (ii) stating that no Default or Event of Default exists or
will exist as a result of such transfer, borrowing or repayment, or if any Default
or Event of Default does exist, specifying the nature and extent thereof and what
action the Borrower proposes to take with respect thereto. In the event that any
such certificate indicates a violation of any of the financial covenants in Section
7.3, then Borrower shall, as applicable, contemporaneously with the delivery of any
such certificate make a principal payment by an amount necessary to achieve
compliance with such financial covenants or if caused by a transfer of a Portfolio
Asset make such a principal payment contemporaneously with the closing of such
transfer.

7.2.7 Information to Owners. To the extent not otherwise provided
hereunder, promptly upon the mailing thereof to the owners of Borrower generally,
copies of all financial statements and reports so mailed.

-24-

 

7.2.8 Portfolio Investments. As soon as available, and in any event
within sixty (60) days after the close of each fiscal quarter of Borrower, a report
in a form reasonably satisfactory to Administrative Agent describing (i) each
Portfolio Investment made during such fiscal quarter and (ii) any transfer of any
Portfolio Investment during such fiscal quarter to another legal entity in which
Borrower has acquired a direct or indirect interest. Such report shall be
accompanied by a Direction Letter for each such Portfolio Investment made in a
Portfolio Investment Entity that is not controlled by Borrower or affiliates of
Borrower and shall include a description of any such Portfolio Investment, and such
other information as reasonably requested by Administrative Agent. Except as
provided in Section 3.2(e), each such Portfolio Investment shall, subject to any
Permitted Liens, automatically become a part of the Collateral hereunder and shall
be subject to the terms and provisions of this Agreement and any other applicable
Credit Document, including without limitation Section 3.2 of this Agreement.

7.2.9 Auditor’s Reports. Promptly upon receipt thereof, a copy of any
other report or “management letter” submitted by independent accountants to the
Borrower in connection with any annual, interim or special audit of the books of the
Borrower.

7.2.10 Environmental Reports. Promptly upon transmission thereof by
Borrower or any other member of the Combined Group, copies of any filings and
registrations with, and reports to, the United States Environmental Protection
Agency, or any state or local agency responsible for environmental matters, the
United States Occupational Health and Safety Administration, or any state or local
agency responsible for health and safety matters, or any successor agencies or
authorities concerning environmental, health or safety matters pertaining to any of
the Assets.

7.2.11 Notice of Default or Litigation. Upon the Borrower obtaining
knowledge thereof, it will give notice to the Administrative Agent promptly, but in
any event within five (5) Business Days of obtaining such knowledge, of the
occurrence of any of the following with respect to the Borrower, the General
Partner, any Portfolio Investment Entity or any other member of the Combined Group:
(i) any development in the business or affairs of any such Person that has resulted
in, or that Borrower reasonably believes may result in, a Material Adverse Effect,
(ii) the pendency or commencement of any litigation, arbitration or governmental
proceeding against any such Person in which damages are sought or environmental
remediation demanded which could reasonably be expected to be adversely
determined and
which, if adversely determined, could be expected to have a Material Adverse Effect,
(iii) any levy of an attachment, execution or other process against its assets which
could reasonably be expected to have a Material Adverse Effect, (iv) the receipt of
any notice alleging the occurrence of an event or condition which shall constitute a
default or event of default under any other agreement for borrowed money, or (v) the
institution of any proceedings against, or the receipt of written notice of
potential liability or responsibility for any violation, or alleged violation which
could reasonably be expected to be adversely

-25-

 

determined, of any federal, state or
local law, rule or regulation, including but not limited to, Environmental Laws, the
violation of which could reasonably be expected to have a Material Adverse Effect.

7.2.12 Reserved.

7.2.13
Debt. (i) At least ten (10) Business
Days prior to the incurrence thereof, or (ii) in the case of any Portfolio Asset
held by a Person other than a member of the Combined Group, within five (5) Business
Days after obtaining knowledge of the incurrence thereof if not within the knowledge
of the Borrower prior to such incurrence, notice to Administrative Agent specifying
the amount and nature of any additional (i.e., other than the Funded Debt and the
Funded Debt Documents existing as of the date hereof and reflected on Exhibit
B hereto) Indebtedness, encumbrances, mortgages or other security interests
(other than Permitted Liens) affecting any of the Portfolio Assets or any material
property or Investment of Borrower or any other member of the Combined Group.

7.2.14 Other Information. With reasonable promptness upon any such
request, such other information regarding the business, properties or financial
condition of the Borrower or any other member of the Combined Group as the
Administrative Agent may reasonably request.

	 	7.3	 	Financial Covenants.

	 	(a)	 	Consolidated Leverage Ratio. The Borrower will not permit Funded Debt
(including, without limitation, the outstanding balance under the subject Facility) to
exceed seventy percent (70%) of the Total Asset Value. This covenant shall be tested
quarterly at the end of each calendar quarter, at the time each new Loan is made, and
in connection with the delivery of an officer’s certificate pursuant to Section 7.2.6.
	 
	 	(b)	 	Minimum Interest Coverage Ratio. The ratio of the EBITDA to the
Interest Expense shall be greater than 1.50 to 1.00. This covenant shall be tested
quarterly at the end of each calendar quarter, at the time of each Loan, and in connection with
the delivery of an officer’s certificate pursuant to Section 7.2.6, in each case with
respect to the prior two (2) fiscal quarters most recently ended, annualized; provided
that pro forma financial information shall be provided for each fiscal quarter for
which actual results are not then available.
	 
	 	(c)	 	Minimum Tangible Net Worth. Borrower shall maintain a Tangible Net
Worth in excess of Three Hundred Million Dollars ($300,000,000.00) plus seventy five
percent (75%) of the proceeds of any equity offerings, contributions or sales of
treasury stock received by the Borrower after the Closing Date. This covenant shall be
tested quarterly at the end of each calendar quarter, at the time of each Loan, and in
connection with the delivery of an officer’s certificate pursuant to Section 7.2.6.
	 
	 	(d)	 	Minimum Fixed Charge Covenant. The ratio of EBITDA to Fixed Charge
shall be greater than 1.40 to 1.0. This covenant shall be tested quarterly at the end
of each

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	 	 	 	calendar quarter, at the time of each Loan, and in connection with the delivery
of an officer’s certificate pursuant to Section 7.2.6, in each case with respect to the
prior two (2) fiscal quarters most recently ended, annualized; provided that pro forma
financial information shall be provided for each fiscal quarter for which actual
results are not then available.

	 	7.4	 	Indebtedness and Restrictions on Liens, Transfers and Additional Debt.
The Borrower shall not, without the prior written consent of the Administrative Agent
and the Required Lenders (which may be withheld in their sole discretion):

     (a) incur any Indebtedness (other than the Indebtedness arising under the
Senior Credit Facility or this Agreement and the other Credit Documents) that is
recourse to Borrower (excepting customary environmental and other indemnification
obligations in respect of Indebtedness of Persons in which Borrower has an interest
which is not otherwise recourse to Borrower);

     (b) provide any completion or other guarantees either directly or indirectly
(including, without limitation, through a joint venture) in excess of $5,000,000.00
in the aggregate; and

     (c) [Reserved]

     (d) further encumber the Portfolio Investments; provided that the foregoing
shall not limit the right of Borrower to cause the refinancing of any Funded Debt on
such terms and conditions as Borrower may direct (including the granting of liens on
Portfolio Investments and the granting of direct and indirect interests therein, or
Borrower’s becoming subject to an agreement prohibiting or otherwise restricting the
creation of liens on Portfolio Investments) so long as such refinancing does not
cause the violation of any of the covenants set forth in Section 7.3 of this
Agreement. In connection with any such refinancing, Borrower covenants to use
commercially reasonable efforts to maintain in full
force and effect all existing pledges and assignments of economic interests
granted with respect to Borrower’s interests in Portfolio Investments by Borrower
pursuant to this Agreement and the other Credit Documents to which it is a party.
In the event such refinancing requires the release of Lenders’ security interests in
all or part of any Portfolio Investment that is the subject of the refinancing
permitted by this Section 7.4(d), then Administrative Agent is authorized and shall
be obligated to release such Portfolio Investment from all pledges thereof and
security interests therein created by the Credit Documents; provided,
however that the Administrative Agent may refuse to release any more than 51% of any
such Portfolio Investment from any such pledge or security interest, unless
Administrative Agent has given its consent to such refinancing, such consent not to
be unreasonably withheld or delayed. If such refinancing will result in Borrower’s
noncompliance with the covenants set forth in Section 7.3 of this Agreement, the
outstanding aggregate principal amount of the Loans shall be reduced by the amount
necessary to maintain compliance with Borrower’s covenants contained in Section 7.3.
Within three (3) Business Days after receipt

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of a written request from Borrower and
provided Borrower has satisfied the foregoing reduction requirement, if applicable,
Administrative Agent on behalf of Lenders shall execute such releases of Lenders’
security interests in the Portfolio Investments that are the subject of a
refinancing permitted by this Section 7.4(d) as Borrower reasonably requests in
connection with such refinancing.

     (e) Except as specifically set forth in Section 7.4(d) and Section 7.5
which provide instances in which Administrative Agent’s consent is required, nothing
in this Agreement or any other Credit Document shall, and Borrower is hereby
specifically permitted to and to permit or cause any Subsidiary or Portfolio
Investment Entity to, mortgage, grant securities interests in, and otherwise
encumber any Portfolio Asset and the direct and indirect interests of any Portfolio
Entity in any Portfolio Asset.

	 	7.5	 	Liens/Negative Pledges. Except as permitted in Section 7.4(d) hereof,
the Borrower will not either (i) contract, create, incur, assume or permit to exist any
additional Lien (other than Permitted Liens) with respect to any of the Portfolio
Investments, whether now owned or hereafter acquired, or (ii) enter into, assume or
become subject to any agreement (other than this Agreement, the other Credit Documents
and the Funded Debt Documents listed and described on Exhibit B) (A)
prohibiting or otherwise restricting the creation or assumption of any Lien upon any of
the Portfolio Investments or (B) requiring the Borrower to grant a Lien to a Person in
the event Borrower grants a Lien on a Portfolio Investment to another Person.
Notwithstanding the foregoing or anything to contrary contained elsewhere herein,
including, without limitation, Section 3.2 hereof, the parties hereby (i) acknowledge
that in connection with a certain revolving credit facility (the “Senior Credit
Facility”) evidenced by, inter alia, that certain Credit Agreement dated as of
September 9, 2005 executed by and among Borrower, KeyBank National Association, as
agent (“Senior Agent”) for itself and the other lenders a party
thereto (the “Senior Credit Lenders”), and the Senior Credit Lenders, Borrower has
granted a security interest in the Collateral to Senior Credit Agent for the benefit
of the Senior Credit Lenders to secure Borrower’s obligations under the Senior Credit
Facility (the “Senior Security Interest”) and (ii) agree that the security interest in
the Collateral granted by Borrower to Administrative Agent for the benefit of the
Lenders pursuant to the Pledge Agreement shall be subject and subordinate in all
respects to the Senior Security Interest.
	 
	 	7.6	 	Nature of Business. The Borrower will not alter in a material way the
character or conduct of its business from that conducted as of the Closing Date which
is and shall be limited to the business permitted by the Partnership Agreement as of
the Closing Date; provided, however, this Section 7.6 shall not be construed to prevent
the Borrower from making procedural changes in the manner in which Borrower conducts
its ordinary business operations.
	 
	 	7.7	 	Limitations on Certain Transactions

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	 	(a)	 	Borrower shall not dissolve, terminate or liquidate, nor merge or consolidate
with any other Person; and
	 
	 	(b)	 	[Reserved]
	 
	 	(c)	 	Borrower will not become party to, nor will Borrower permit any other member of
the Combined Group to become a party to, any document, agreement, or instrument or
subject to any other obligation or any charter or corporate or partnership restriction,
as the case may be, from and after the date hereof, which individually or in the
aggregate, would have a Material Adverse Effect.
	 
	 	7.8	 	Investments. Borrower shall not make any Investment which is not a
Permitted Investment.
	 
	 	7.9	 	Dividends and Distributions. So long as no Event of Default has
occurred and is continuing or would be directly or indirectly caused as a result
thereof, the Borrower (after taking into account all available funds of the Borrower
from all other sources) may declare and make any dividends or distributions as
permitted under the Partnership Agreement; provided, however, that the Borrower may
while an Event of Default is continuing make distributions or dividends but only to the
extent (after taking into account all available funds of the Borrower from all other
sources) required in order to enable the General Partner to continue to qualify as a
REIT. For the avoidance of doubt, under no circumstances shall the Borrower use the
proceeds of this Facility to make distributions or dividends.
	 
	 	7.10	 	Transactions with Portfolio Investments. Borrower will not, nor will
it permit any of its Subsidiaries to, enter into any transaction or series of
transactions with any partner or any employee of any member of the Combined Group or
any Portfolio Investment Entity other than on terms and conditions substantially as
favorable to such Person as would be obtainable by it in a comparable arm’s length
transaction with a Person other than any partner, employee or Portfolio Investment
Entity, unless such transaction or series of transactions, would not or could not
reasonably be expected to have, in the aggregate, a Material Adverse Effect, or
otherwise be materially detrimental to the economic interests of the Combined Group
taken as a whole.
	 
	 	7.11	 	Amendments. To the extent that any amendment, modification,
supplement, waiver or termination of any provisions of the Partnership Agreement, or
other governing or organizational document of Borrower or any other member of the
Combined Group would permit proceeds of the Loans to be used in a manner inconsistent
with such governing or organizational document in effect at the Closing Date, the
Borrower agrees that it shall not, and shall not permit any other member of the
Combined Group to, apply proceeds of the Loans in a manner inconsistent with what was
permitted under the governing or organizational documents in effect on the Closing
Date.
	 
	 	7.12	 	ERISA. The Borrower will not establish any Plan.

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	 	7.13	 	Place for Records; Inspection. Borrower shall maintain all of its
business records at the address specified at the beginning of this Agreement. Upon
reasonable prior notice and at reasonable times during normal business hours,
Administrative Agent shall have the right (through such agents or consultants as
Administrative Agent may designate) to make copies of and abstracts from Borrower’s
books of account, correspondence and other records and to discuss its financial and
other affairs with any of its investors and any accountants hired by Borrower as well
as to visit and inspect the Assets, it being agreed that Administrative Agent and each
of the Lenders shall use reasonable efforts to not divulge confidential information
obtained from such examination to others except in connection with Legal Requirements
and in connection with administering the Facility, enforcing its rights and remedies
under the Credit Documents and in the conduct, operation and regulation of its banking
and lending business (which may include, without limitation, the transfer of the
Facility or of participation interests therein provided that any such transferee or
participant agrees to maintain the confidentiality thereof as required by this
Agreement). Any assignee or transferee of the Facility or any holder of a
participation interest in the Facility shall be entitled to deal with such information
in the same manner and in connection with any subsequent transfer of its interest in
the Facility or of further participation interests therein.
	 
	 	7.14	 	Costs and Expenses. Borrower shall pay all costs and expenses
(excluding salaries or wages of officers, directors and employees of Administrative
Agent or any Lender and overhead expenses charged by or allocated to Administrative
Agent or any Lender) reasonably incurred by Administrative Agent in connection with the
implementation of the Facility and the enforcement of Administrative Agent’s and
Lenders’ rights under the Credit Documents, including, without limitation, reasonable
third party costs and expenses, including reasonable legal fees and disbursements,
appraisal fees (in accordance with, and subject to the terms of, this Agreement),
inspection fees, plan review fees, travel costs, fees and out-of-pocket costs of
independent engineers and consultants. Borrower’s obligations to pay such costs and
expenses shall include, without limitation, all reasonable attorneys’ fees and other
costs and expenses reasonably incurred for preparing and conducting litigation or
dispute resolution arising from any breach by Borrower of any covenant, warranty,
representation or agreement under any Credit Document to which a member of the Combined
Group is a party.
	 
	 	7.15	 	Compliance with Legal Requirements. Borrower shall comply, and shall
cause each other member of the Combined Group to comply, in all material respects with
all Legal Requirements. In furtherance of the foregoing and not in limitation thereof,
Borrower hereby agrees to provide the Administrative Agent with any additional
information that the Administrative Agent reasonably requests from time to time in
order to ensure compliance by Borrower with all applicable Anti-Money Laundering Laws.
As used herein, the term “Anti-Money Laundering Laws” shall mean the USA Patriot Act of
2001, the Bank Secrecy Act, and Executive Order 13324 — Blocking Property and
Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support
Terrorism, and any similar Legal Requirements.

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	 	7.16	 	MAI Appraisals. Promptly upon receipt thereof, Borrower shall deliver
to Administrative Agent each appraisal of any of the Portfolio Assets available to
Borrower. During the existence and continuation of an Event of Default, if the most
recent MAI Appraisal for any Portfolio Asset is older than one (1) year, then Borrower
shall upon Administrative Agent’s request therefor promptly use its best efforts to
obtain a current MAI Appraisal for such Portfolio Asset at Borrower’s sole cost and
expense. Administrative Agent may require Borrower to use its best efforts to obtain
updated MAI Appraisals for Portfolio Assets which Borrower has previously delivered MAI
Appraisals to Administrative Agent, at Borrower’s sole cost and expense , but if an
updated MAI Appraisal is requested for any Portfolio Asset for which an MAI Appraisal
is available that is less than one (1) year old, the
Administrative Agent and the Lenders shall pay the costs of such requested appraisal.
	 
	 	7.17	 	Title to Properties. The Borrower and each other member of the
Combined Group has good title to all of its respective properties, assets and rights of
every name and nature purported to be owned by it.
	 
	 	7.18	 	Insurance. Borrower will, and will cause the other members of the
Combined Group to, maintain with respect to their respective properties, with
financially sound and reputable insurers, insurance with respect to such properties and
its business against such casualties and contingencies as shall be in accordance with
the general practices of businesses engaged in similar activities in similar geographic
areas and in amounts, containing such terms, in such forms and for such periods as may
be reasonable and prudent.
	 
	 	7.19	 	Taxes. The Borrower will, and will cause each of the other members of
the Combined Group to, pay or cause to be paid taxes, assessments and other
governmental charges payable by it or as to such Person’s property and file all returns
and reports relating thereto before the same become delinquent including, without
limitation, upon the income or profits therefrom of any such Person. Promptly upon
request by the Administrative Agent, the Borrower will provide evidence of the payment
of such taxes, assessments and other governmental charges in the form of receipted tax
bills or other form reasonably acceptable to the Administrative Agent, or evidence of
the existence of applicable contests as permitted herein.
	 
	 	7.20	 	Compliance with Contracts, Licenses, and Permits. The Borrower will
comply with, and will cause each other member of the Combined Group to comply with (a)
the provisions of its partnership agreement or corporate charter and other
organizational documents, as applicable, (b) all material agreements and instruments to
which it is a party or by which it or any of its properties may be bound, and (c) all
applicable decrees, orders, and judgments, if the failure to comply therewith will,
either individually or in the aggregate, result in a Material Adverse Effect.

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	 	7.21	 	Replacement Documentation. Upon receipt of an affidavit of an officer
of Administrative Agent or any Lender as to the loss, theft, destruction or mutilation
of a Note or any other Credit Document, Borrower will issue, in lieu thereof, a
replacement Note or other Credit Document in the same principal amount thereof and
otherwise of like tenor.
	 
	 	7.22	 	Perfected Interest Covenants. Borrower shall at all times comply with
the following covenants with respect to each of the Perfected Interests: (i) Borrower
shall have full right, title and interest to each Perfected Interest, subject to
Permitted Liens and such other exceptions set forth herein or in the Pledge Agreement
or other Credit Documents; (ii) Borrower shall not encumber any Perfected Interest
except as permitted hereunder (including as permitted by Section 7.4(d)) or under any
Security Document; (iii) Borrower shall comply with all applicable Legal Requirements
with respect to each Perfected Interest; (iv) Borrower shall promptly deliver to
Administrative Agent copies of all notices given or received with respect to each
Perfected Interest (other than routine correspondence); and (v) Borrower shall comply
with all covenants contained in the Security Documents that are in effect with respect
to each Perfected Interest.
	 
	 	7.23	 	Existence of the Borrower; Maintenance of REIT Status. The Borrower
will do or cause to be done all things necessary to preserve and keep in full force and
effect its existence as a Delaware limited partnership. Borrower will do all things
commercially reasonable and consistent with the Partnership Agreement, to enable the
General Partner to at all times maintain the General Partner’s status as a REIT and not
take any action which could lead to the General Partner’s disqualification as a REIT.
	 
	 	7.24	 	Refinance of Illinois Property. Borrower shall apply the proceeds
received by it from any mortgage or other financing of the Illinois Property (other
than Loans under the Facility) to the reduction of the outstanding principal balance of
the Loans.

8. SPECIAL PROVISIONS.

	 	8.1	 	Right to Contest.

8.1.1 Taxes and Claims by Third Parties. Notwithstanding anything in
this Agreement to the contrary, it is agreed that any tax, assessment, charge, levy,
claim or obligation to a third party (expressly excluding an obligation to make
payments to the Lenders created under the Credit Documents) need not be paid while
the validity or amount thereof shall be contested currently, diligently and in good
faith by appropriate proceedings and if Borrower or the other relevant member of the
Combined Group shall have adequate unencumbered (except in favor of Administrative
Agent, on behalf of the Lenders or under the Funded Debt Documents, as applicable)
cash reserves with respect thereto and provided that Borrower or the other relevant
member of the Combined Group shall pay all taxes, assessments, charges, levies or
obligations immediately upon the

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commencement of proceedings to enforce any lien
which may have attached as security therefor, unless such proceeding is stayed by
proper court order pending the outcome of such contest.

8.1.2 Legal Requirements. Any member of the Combined Group may contest
any claim, demand, levy or assessment under any Legal Requirements by any person or
entity if: (i) the contest is based upon a material question of law or fact raised
by such Person in good faith; (ii) the contest is properly commenced and thereafter
diligently pursued; (iii) the contest will not materially impair the ability to
ultimately comply with the contested Legal Requirement should the contest not be
successful; (iv) Borrower demonstrates to Administrative Agent’s reasonable
satisfaction that such Person has the financial capability to undertake and pay for
such contest and any corrective or remedial action then or thereafter reasonably
likely to be necessary; (v) there is no reason to believe that the contest will not
be resolved prior to the Maturity Date; and (vi) no Default or Event of Default
exists.

	 	8.2	 	Borrower Fully Liable. Borrower shall be fully liable for the Facility,
each of the Loans and all other Borrower Obligations.

9. EVENTS OF DEFAULT.

     The following provisions deal with Default, Events of Default, notice, grace and cure
periods, and certain rights of Administrative Agent and the Lenders following an Event of Default.

	 	9.1	 	Default and Events of Default. The term “Default” as used herein or in
any of the other Credit Documents shall mean an Event of Default, or any fact or
circumstance which constitutes, or upon the lapse of time, or giving of notice, or
both, could constitute, an Event of Default. Each of the following events, unless
cured within any applicable grace or notice period set forth or referred to below in
this Section 9.1, or in Section 9.2, shall constitute an “Event of Default”:

9.1.1 Generally. A default by Borrower in the performance of any term,
provision or condition of this Agreement to be performed by Borrower, or a breach,
or other failure to satisfy, any other term, provision, condition, covenant or
warranty under this Agreement and such default remains uncured beyond any applicable
specific grace or notice period provided for in this Agreement, or as set forth in
Section 9.2 below.

9.1.2 Note and Other Credit Documents. A default by Borrower in the
performance of or a breach, or other failure to satisfy, any term, provision,
condition, covenant, or warranty under any Note or any other Credit Document,
regardless of whether the then undisbursed portion of the Maximum Loan Amount is
sufficient to cover any payment of money required thereby, and the specific grace or
notice period, if any, allowed for the default in question shall have expired
without such default having been cured; or any Credit Document shall fail to be in
full force and effect or to give the Administrative Agent and

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Lenders the rights,
powers and privileges purported to be created thereby (except insofar as such
rights, powers and privileges are contrary to applicable public policy and except to
the extent such failure is due to the gross negligence or willful misconduct of
Administrative Agent or a Lender).

9.1.3 Financial Status and Insolvency. (A) Borrower shall: (i) admit
in writing its inability to pay its debts generally as they become due; (ii) file a
petition in bankruptcy or a petition to take advantage of any insolvency act; (iii)
make an assignment for the benefit of creditors; (iv) consent to, or acquiesce in,
the appointment of a receiver, liquidator or trustee of itself or of the whole or
any substantial part of its assets; (v) file a petition or answer seeking
reorganization, arrangement, composition, readjustment, liquidation, dissolution or
similar relief under the Federal Bankruptcy laws or any other applicable law; (vi)
have a court of competent jurisdiction enter an order, judgment or decree appointing
a receiver, liquidator or trustee of Borrower, or of the whole or any substantial
part of the assets of Borrower, and such order, judgment or decree shall remain
unvacated or not set aside or unstayed for one hundred twenty (120) days; (vii) have
a petition filed against it seeking reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under the Federal
Bankruptcy laws or any other applicable law and such petition shall remain
undismissed for one hundred twenty (120) days; or (viii) have, under the provisions
of any other law for the relief or aid of debtors, any court of competent
jurisdiction assume custody or control of Borrower or of the whole or any
substantial part of its assets and such custody or control shall remain unterminated
or unstayed for one hundred twenty (120) days; or (B) any such event shall occur
with respect to the General Partner of Borrower.

9.1.4 Breach of Representation or Warranty. Any representation or
warranty made by Borrower herein or in any other certificate, instrument or document
relating to the Facility required to be delivered pursuant to any Credit Document
shall at the time made or deemed to have been
remade or renewed be false or misleading in any material respect, or any
warranty shall be materially breached.

9.1.5 Defaults under Other Agreements. With respect to any
Indebtedness (other than Indebtedness outstanding under this Agreement) of the
Borrower or any other member of the Combined Group or Portfolio Investment Entity,
(A) such Person shall (1) default in any payment (beyond the applicable grace period
with respect thereto, if any) with respect to any such Indebtedness and such
Indebtedness is accelerated, or (2) the occurrence and continuance of a default in
the observance or performance relating to such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other event
or condition shall occur or condition exist, the effect of which default or other
event or condition is to cause, or permit, the holder or holders of such
Indebtedness (or trustee or agent on behalf of such holders) to cause (determined
without regard to whether any notice or lapse of time is required), any such
Indebtedness to become due prior to its stated maturity; and (B) any such
Indebtedness shall be declared due and payable, or required to be prepaid other

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than by a regularly scheduled required prepayment, prior to the stated maturity thereof;
provided, however, that such Indebtedness of Borrower and Borrower’s Pro Rata Share
of such Indebtedness of any other member of the Combined Group or another Portfolio
Investment Entity, collectively and without duplication (including instances where
more than one such Person is an obligor under such Indebtedness), then due and
payable or required to be prepaid prior to stated maturity is at least Ten Million
Dollars ($10,000,000.00).

9.1.6 Change of Control. The occurrence of a Change of Control.

9.1.7 Judgments. There shall remain in force, undischarged,
unsatisfied and unstayed, for more than thirty (30) days, whether or not
consecutive, any uninsured final judgment against any member of the Combined Group
such that together with Borrower’s Pro Rata Share of other outstanding uninsured
final judgments, undischarged, unsatisfied and unstayed, against any of such parties
equals or exceeds, collectively and without duplication, in the aggregate Ten
Million Dollars ($10,000,000.00).

	 	9.2	 	Grace Periods and Notice. As to each of the foregoing events the
following provisions relating to grace periods and notice shall apply:

9.2.1 No Notice or Grace Period. There shall be no grace period and no
requirement of notice with respect to the payment of principal at Maturity and no
grace period and no requirement of notice with respect to defaults related to the
voluntary filing of bankruptcy or reorganization proceedings or a general assignment
for the benefit of creditors, with respect to non-monetary defaults which are not
reasonably capable of being cured or with respect to a breach of warranty or
representation under Section 6.1. (Financial Information), or with respect to
breaches under Section 7.3 (Financial Covenants), Section 7.4 (Indebtedness and
Restrictions on Liens, Transfers and Additional Debt), Section 7.7 (Limitations on
Certain Transactions), Section 9.1.6 (Change of Control) or Section 9.1.7
(Judgments).

9.2.2 Nonpayment of Interest and Principal. As to the nonpayment of a
scheduled interest payment or a scheduled installment of principal prior to
Maturity, there shall be a ten (10) day grace period without any requirement of
notice from Administrative Agent, subject, however, to Section 2.3.13 above;
provided, however, Borrower shall only be entitled to such 10-day grace period once
in any calendar year with no grace or notice period as to any subsequent nonpayment
within the relevant calendar year.

9.2.3 Other Monetary Defaults. All other monetary defaults shall have
a five (5) day grace period following notice from Administrative Agent (unless
otherwise specifically provided for herein), or, if shorter, a grace period without
notice until five (5) Business Days before the last day on which payment is required
to be made in order to avoid: (i) the cancellation or lapse of required

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insurance, or (ii) a tax sale or the imposition of late charges or penalties in respect of
taxes or other municipal charges;

9.2.4 Nonmonetary Defaults Capable of Cure. As to nonmonetary defaults
which are reasonably capable of being cured or remedied, unless there is a specific
shorter or longer grace period provided for in this Agreement or in another Credit
Document, there shall be a thirty (30) day grace period following notice from
Administrative Agent or, if such default would reasonably require more than thirty
(30) days to cure or remedy, such longer period of time not to exceed a total of one
hundred eighty (180) days from Administrative Agent’s notice as may be reasonably
required so long as Borrower shall commence reasonable actions to remedy or cure the
default within thirty (30) days following such notice and shall diligently prosecute
such curative action to completion within such one hundred eighty (180) day period.
As to breaches of warranties and representations (other than those set forth in
Section 6.1 above) there shall be a thirty (30) day grace period following notice
from Administrative Agent.

	 	9.3	 	Certain Remedies. If an Event of Default shall occur and be
continuing:

9.3.1 Termination of Commitments. Administrative Agent may declare the
Commitments terminated whereupon the Commitments shall be immediately terminated.

9.3.2 Accelerate Debt. Administrative Agent may, and upon the
direction of the Required Lenders shall, declare the Indebtedness immediately due
and payable, provided that in the case of a voluntary petition in bankruptcy filed
by Borrower or (after the expiration of the grace period if any set forth in Section
9.1.3 above) an involuntary petition in bankruptcy filed against Borrower, such
acceleration shall be automatic.

9.3.3 Pursue Remedies. Administrative Agent may pursue any and all
remedies provided for hereunder, or under any one or more of the other Credit
Documents.

9.3.4 Written Waivers. Notwithstanding anything to the contrary
contained herein, if a Default or an Event of Default is waived by the Required
Lenders or the Administrative Agent, in their sole discretion, pursuant to a
specific written instrument executed by an authorized officer of Administrative
Agent, or if a Default or an Event of Default is timely cured by Borrower, the
Default or Event of Default so waived or Default so cured shall be deemed to have
never occurred.

9.3.5 Reserved.

9.3.6 Enforcement of Rights. Administrative Agent may enforce any and
all rights and interests created and existing under the Credit Documents and all
rights of set off.

     Notwithstanding the foregoing, if an Event of Default specified in Section 9.1.3 shall occur
as to Borrower, then the Commitments shall automatically terminate and all
Loans, all

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accrued interest in respect thereof, all accrued and unpaid Fees and other indebtedness or obligations
owing to the Administrative Agent and/or any of the Lenders hereunder or under the other Credit
Documents automatically shall immediately become due and payable without the giving of any notice
or other action by the Administrative Agent or the Lenders.

     Notwithstanding the fact that enforcement powers reside primarily with Administrative Agent,
subject to the provisions of Section 11, each Lender has, to the extent permitted by law, a
separate right of payment and shall be considered a separate “creditor” holding a separate
“claim” within the meaning of Section 101(5) of the Bankruptcy Code or any other insolvency
statute; provided however, no Lender shall take any action with respect to its claim without first
obtaining the consent of the Required Lenders and Administrative Agent (other than filing a proof
of claim) or vote its claim in a manner inconsistent with the vote of the Required Lenders and
Administrative Agent.

10. SECURITY INTEREST AND SET-OFF.

	 	10.1	 	Security Interest. Borrower hereby grants to Administrative Agent, on
behalf of the Lenders a lien, security interest and right of setoff as security for all
liabilities and obligations to Administrative Agent and the Lenders, whether now
existing or hereafter arising, upon and against all deposits, credits, collateral and
property, now or hereafter in the possession, custody, safekeeping or control of
Administrative Agent or any Lender or any entity under the control of Key Corp. or in
transit to any of them.
	 
	 	10.2	 	Set-Off and Debit. If an Event of Default occurs and is continuing,
any deposits, balances or other sums credited by or due from Administrative Agent or
any Lender, or from any affiliate of Administrative Agent or any Lender, to Borrower
may to the fullest extent not prohibited by applicable law at any time or from time to
time, without regard to the existence, sufficiency or adequacy of any other collateral,
and without notice or compliance with any other condition precedent now or hereafter
imposed by statute, rule of law or otherwise, all of which are hereby waived, be set
off, debited and appropriated, and applied by Administrative Agent or any Lender
against any or all of the Borrower Obligations irrespective of whether demand shall
have been made and although such obligations may be unmatured, in such manner as
Administrative Agent or any Lender in its sole and absolute discretion may determine.
Within five (5) Business Days of making any such set off, debit or appropriation and
application, Administrative Agent or the applicable Lender agrees to notify Borrower
thereof, provided the failure to give such notice shall not affect the validity of such
set off, debit or appropriation and application. ANY AND ALL RIGHTS TO REQUIRE
ADMINISTRATIVE AGENT OR ANY LENDER TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO
ANY OTHER COLLATERAL WHICH SECURES THE LOAN, PRIOR TO EXERCISING ITS RIGHT OF SETOFF
WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF THE BORROWER, ARE HEREBY
KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED. Each of the Lenders agrees with each
other Lender that (a) if an amount to be set off is to be applied to indebtedness of
the Borrower to such Lender, other

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than the obligations evidenced by the Note held by
such Lender, such amount shall be applied ratably to such other indebtedness and to the
obligations evidenced by all of the Notes held
by such Lender, and (b) if such Lender shall receive from the Borrower, whether by
voluntary payment, exercise of the right of setoff, counterclaim, cross action,
enforcement of the claim evidenced by the Note held by such Lender by proceedings
against the Borrower at law or in equity or by proof thereof in bankruptcy,
reorganization liquidation, receivership or similar proceedings, or otherwise, and
shall retain and apply to the payment of the Note held by such Lender any amount in
excess of its ratable portion of the payments received by all of the Lenders with
respect to the Notes held by all of the Lenders, such Lender will make such
disposition and arrangements with the other Lenders with respect to such excess,
either by way of distribution, pro tanto assignment of claims, subrogation or
otherwise as shall result in each Lender receiving in respect of the Note held by it
its proportionate payment as contemplated by this Agreement; provided that if all or
any part of such excess payment is thereafter recovered from such Lender, such
disposition and arrangements shall be rescinded and the amount restored to the extent
of such recovery, but without interest.

	 	10.3	 	Right to Freeze. Administrative Agent and each of the Lenders shall
also have the right, at its option, upon the occurrence of any event which would
entitle Administrative Agent or any Lender to set off or debit as set forth in Section
10.2, to freeze, block or segregate any such deposits, balances and other sums so that
Borrower may not access, control or draw upon the same.
	 
	 	10.4	 	Additional Rights. The rights of Administrative Agent, the Lenders and
each affiliate of Administrative Agent and each of the Lenders under this Section 10
are in addition to, and not in limitation of, other rights and remedies, including
other rights of set off, which Administrative Agent, or any Lender may have.

11. THE ADMINISTRATIVE AGENT AND THE LENDERS

	 	11.1	 	Appointment of Administrative Agent. Each Lender hereby irrevocably
designates and appoints KeyBank National Association as Administrative Agent of such
Lender to act as specified herein and in the other Credit Documents, and each such
Lender hereby irrevocably authorizes the Administrative Agent to take such actions,
exercise such powers and perform such duties as are expressly delegated to or conferred
upon the Administrative Agent by the terms of this Agreement and the other Credit
Documents, together with such other powers as are reasonably incidental thereto. The
Administrative Agent agrees to act as such upon the express conditions contained in
this Section 11. The Administrative Agent shall not have any duties or
responsibilities except those expressly set forth herein or in the other Credit
Documents, nor shall it have any fiduciary relationship with any Lender, and no implied
covenants, responsibilities, duties, obligations or liabilities shall be read into this Agreement
or otherwise exist against the Administrative Agent. The provisions of this Section
11 (except for Sections 11.10, 11.12, 11.15.1, 11.15.2 (v) — (viii), 11.15.3, 11.15.4,
11.15.5, 11.16, 11.20 and 11.22) are solely for the benefit of the Administrative
Agent and the Lenders, and the

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Borrower shall not have any rights as a third party
beneficiary of any of the provisions hereof.

	 	11.2	 	Administration of Facility by Administrative Agent. The Administrative
Agent shall be responsible for administering the Facility on a day-to-day basis. In
the exercise of such administrative duties, the Administrative Agent shall use the same
diligence and standard of care that is customarily used by the Administrative Agent
with respect to similar loans held by the Administrative Agent solely for its own
account.

     Each Lender delegates to the Administrative Agent the full right and authority on its behalf
to take the following specific actions in connection with its administration of the Facility:

     (i) to fund the Loans in accordance with the provisions of the Credit Documents, but only to
the extent of immediately available funds provided to the Administrative Agent by the respective
Lenders for such purpose;

     (ii) to receive all payments of principal, interest, fees and other charges paid by, or on
behalf of, the Borrower and, except for fees to which the Administrative Agent is entitled pursuant
to the Credit Documents or otherwise, to distribute all such funds to the respective Lenders as
provided for hereunder;

     (iii) to keep and maintain complete and accurate files and records of all material matters
pertaining to the Facility, and make such files and records available for inspection and copying by
each Lender and its respective employees and agents during normal business hours upon reasonable
prior notice to the Administrative Agent; and

     (iv) to do or omit doing all such other actions as may be reasonably necessary or incident to
the implementation, administration and servicing of the Facility and the rights and duties
delegated hereinabove.

	 	11.3	 	Delegation of Duties. The Administrative Agent may execute any of its
duties under this Agreement or any other Credit Document by or through its agents or
attorneys-in-fact, and shall be entitled to the advice of counsel concerning all
matters pertaining to its rights and duties hereunder or under the other Credit
Documents. The Administrative Agent shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable care.
	 
	 	11.4	 	Exculpatory Provisions. Neither the Administrative Agent nor any of
its officers, directors, employees, agents, attorneys-in-fact or affiliates shall be
liable for any action lawfully taken or omitted to be taken by it or them under or in
connection with this Agreement or the other Credit Documents, except for its or their
gross negligence or willful misconduct. Neither the Administrative Agent nor any of
its officers, directors, employees, agents, attorneys-in-fact or affiliates shall be
responsible for or have any duty to ascertain, inquire into, or verify (i) any recital,
statement, representation or warranty made by the Borrower or any of its officers or
agents contained in this Agreement or the other Credit Documents or in any certificate
or other document delivered in connection therewith; (ii) the

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performance or observance
of any of the covenants or agreements contained in, or the conditions of, this
Agreement or the other Credit Documents; (iii) the state or condition of any properties
of the Borrower or the Assets, or any information contained in the books or records of
the Borrower; (iv) the validity, enforceability, collectibility, effectiveness or
genuineness of this Agreement or any other Credit Document or any other certificate,
document or instrument furnished in connection therewith; or (v) the validity, priority
or perfection of any lien securing or purporting to secure the Borrower Obligations.

	 	11.5	 	Reliance by Administrative Agent. The Administrative Agent shall be
entitled to rely, and shall be fully protected in relying, upon any notice, consent,
certificate, affidavit, or other document or writing believed by it to be genuine and
correct and to have been signed, sent or made by the proper person or persons, and upon
the advice and statements of legal counsel (including, without limitation, counsel to
the Borrower), independent accountants and other experts selected by the Administrative
Agent. The Administrative Agent shall be fully justified in failing or refusing to
take any action under this Agreement or any other Credit Document unless it shall first
receive such advice or concurrence of the Required Lenders as it deems appropriate or
it shall first be indemnified to its satisfaction by the Lenders against any and all
liability and expense which may be incurred by it by reason of the taking or failing to
take any such action. The Administrative Agent shall in all cases be fully protected
in acting, or in refraining from acting, under this Agreement and the other Credit
Documents in accordance with any written request of the Required Lenders, and each such
request of the Required Lenders, and any action taken or failure to act by the
Administrative Agent pursuant thereto, shall be binding upon all of the Lenders;
provided, however, that the Administrative Agent shall not be required in any event to
act, or to refrain from acting, in any manner which is contrary to the Credit Documents
or to applicable law or in any manner reasonably believed by Administrative Agent to be
commercially unreasonable in the applicable jurisdiction.
	 
	 	11.6	 	Notice of Default. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Event of Default unless the
Administrative Agent has actual knowledge of the same or has received notice from a Lender or the Borrower referring
to this Agreement, describing such Event of Default and stating that such notice is a
“notice of default.” In the event that the Administrative Agent obtains such actual
knowledge or receives such a notice, the Administrative Agent shall give prompt notice
thereof to each of the Lenders. The Administrative Agent shall take such action with
respect to such Event of Default as shall be reasonably directed by the Required
Lenders. Unless and until the Administrative Agent shall have received such
direction, the Administrative Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to any such Event of Default
as it shall deem advisable in the best interest of the Lenders; provided, however,
that the Administrative Agent shall not accelerate the indebtedness under this
Agreement without the prior written consent of the Required Lenders.

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	 	11.7	 	Lenders’ Credit Decisions. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other Lender,
and based on the financial statements prepared by the Borrower and such other documents
and information as it has deemed appropriate, made its own credit analysis and
investigation into the business, assets, operations, property, and financial and other
condition of the Borrower and has made its own decision to enter into this Agreement
and the other Credit Documents. Each Lender also acknowledges that it will,
independently and without reliance upon the Administrative Agent or any other Lender,
and based on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in determining whether or not conditions
precedent to closing any Loan hereunder have been satisfied and in taking or not taking
any action under this Agreement and the other Credit Documents. Each Lender expressly
acknowledges that is has relied upon its own legal counsel in its consideration of its
decision to enter into this Agreement and the other Credit Documents and will so rely
in regard to the implementation of the transaction contemplated hereby and thereby and
that it does not have any lawyer-client relationship with Administrative Agent’s
counsel or counsels or any other Lenders with respect thereto.
	 
	 	11.8	 	Administrative Agent’s Reimbursement and Indemnification. The Lenders
agree to reimburse and indemnify the Administrative Agent, ratably in proportion to
their respective Commitments, for (i) any amounts not reimbursed by the Borrower for
which the Administrative Agent is entitled to reimbursement by the Borrower under this
Agreement or the other Credit Documents, (ii) any other expenses incurred by the
Administrative Agent on behalf of the Lenders in connection with the preparation,
execution, delivery, administration, amendment, waiver and/or enforcement of this
Agreement and the other Credit Documents, and (iii) any liabilities, obligations,
losses, damages, penalties, action, judgments, suits, costs, expenses or disbursements
of any kind and nature whatsoever which may be imposed on, incurred by or asserted
against the Administrative Agent in any way
relating to or arising out of this Agreement or the other Credit Documents or any
other document delivered in connection therewith or any transaction contemplated
thereby, or the enforcement of any of the terms hereof or thereof, provided that no
Lender shall be liable for any of the foregoing to the extent that they arise from the
gross negligence or willful misconduct of the Administrative Agent. If any indemnity
furnished to the Administrative Agent for any purpose shall, in the opinion of the
Administrative Agent, be insufficient or become impaired, the Administrative Agent may
call for an additional indemnity and cease, or not commence, to do the action
indemnified against until such additional indemnity is furnished.
	 
	 	11.9	 	Administrative Agent in its Individual Capacity. With respect to its
Commitment as a Lender, and the Loans made by it and the Note issued to it, the
Administrative Agent shall have the same rights and powers hereunder and under any
other Credit Document as any Lender and may exercise the same as though it were not the
Administrative Agent, and the term “Lender” or “Lenders” shall, unless the context
otherwise indicates, include the Administrative Agent in its individual capacity.

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The Administrative Agent and its subsidiaries and affiliates may accept deposits from, lend
money to, and generally engage in any kind of commercial or investment banking, trust,
advisory or other business with the Borrower or any Subsidiary or affiliate of the
Borrower as if it were not the Administrative Agent hereunder.

	 	11.10	 	Successor Administrative Agent. The Administrative Agent may resign
at any time by giving thirty (30) days’ prior notice to the Lenders and Borrower
(provided, however, such resignation shall be effective only upon the appointment of a
successor Administrative Agent in accordance with the provisions of this Section
11.10). The Required Lenders, for good cause, may remove Administrative Agent at any
time by giving thirty (30) days’ prior notice to the Administrative Agent, the Borrower
and the other Lenders. Upon any such resignation or removal, the Required Lenders
shall have the right to appoint a successor Administrative Agent. If no successor
Administrative Agent shall have been so appointed by the Required Lenders and accepted
such appointment within thirty (30) days after the retiring Administrative Agent’s
giving notice of resignation or the Required Lenders’ giving notice of removal, as the
case may be, then the retiring Administrative Agent may appoint, on behalf of the
Borrower and the Lenders, a successor Administrative Agent. Each such successor
Administrative Agent shall be a financial institution which meets the requirements of
an Eligible Assignee. Unless an Event of Default shall have occurred and be
continuing, any successor Administrative Agent shall be subject to the prior written
approval of the Borrower (which approval will not be unreasonably withheld, conditioned
or delayed). Upon the acceptance of any appointment as Administrative Agent hereunder
by a successor Administrative Agent, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and
obligations hereunder and under the other Credit Documents. After any retiring
Administrative Agent’s resignation hereunder, the provisions of this Section 11 shall
continue in effect for its benefit in respect of any actions taken or omitted to be
taken by it while it was acting as the Administrative Agent hereunder.
	 
	 	11.11	 	Duties in the Case of Enforcement. In the case one or more Events of
Default have occurred and shall be continuing, and whether or not acceleration of the
Borrower Obligations shall have occurred, the Administrative Agent shall, at the
request, or may, upon the consent, of the Required Lenders, and provided that the
Lenders have given to the Administrative Agent such additional indemnities and
assurances against expenses and liabilities as the Administrative Agent may reasonably
request, proceed to enforce the provisions of this Agreement and the other Credit
Documents and the exercise of any other legal or equitable rights or remedies as it may
have hereunder or under any other Credit Document or otherwise by virtue of applicable
law, or to refrain from so acting if similarly requested by the Required Lenders. The
Administrative Agent shall be fully protected in so acting or refraining from acting
upon the instruction of the Required Lenders, and such instruction shall be binding
upon all the Lenders. The Required Lenders may direct

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the Administrative Agent in writing as to the method and the extent of any such foreclosure, sale or other
disposition or the exercise of any other right or remedy, the Lenders hereby agreeing
to indemnify and hold the Administrative Agent harmless from all costs and liabilities
incurred in respect of all actions taken or omitted in accordance with such direction,
provided that the Administrative Agent need not comply with any such direction to the
extent that the Administrative Agent reasonably believes the Administrative Agent’s
compliance with such direction to be unlawful or commercially unreasonable in any
applicable jurisdiction. The Administrative Agent may, in its discretion but without
obligation, in the absence of direction from the Required Lenders, take such interim
actions as it believes necessary to preserve the rights of the Lenders hereunder,
including but not limited to petitioning a court for injunctive relief or appointment
of a receiver. Each of the Lenders acknowledges and agrees that no individual Lender
may separately enforce or exercise any of the provisions of any of the Credit
Documents, including without limitation the Notes, other than through the
Administrative Agent.

	 	11.12	 	Respecting Loans and Payments.

11.12.1 Procedures for Loans. Administrative Agent shall give written
notice to each Lender of each request from Borrower for a Loan by facsimile
transmission, hand delivery or overnight courier, not later than 11:00 a.m. (Boston
time) two (2) Business Days prior to any Loan. Each such notice shall be
accompanied by a written summary of the request for a Loan and shall specify a) the date of the requested Loan,
(b) the aggregate amount of the requested Loan, (c) each Lender’s pro rata share of
the requested Loan, and (d) the applicable interest rate selected by Borrower with
respect to such Loan, or any portion thereof, together with the applicable Interest
Period, if any, selected, or deemed selected, by Borrower. Each Lender shall,
before 11:00 a.m. (Boston time) on the date set forth in any such request for a
Loan, make available to Administrative Agent, at an account to be designated by
Administrative Agent at KeyBank National Association in same day funds, each
Lender’s ratable portion of the requested Loan. After Administrative Agent’s
receipt of such funds and upon Administrative Agent’s determination that the
applicable conditions to making the requested Loan have been fulfilled,
Administrative Agent shall make such funds available to Borrower as provided for in
this Agreement. Within a reasonable period of time following the making of each
Loan, but in no event later than ten (10) Business Days following such Loan,
Administrative Agent shall deliver to each Lender a copy of Borrower’s request for
such Loan. Promptly after receipt by Administrative Agent of written request from
any Lender, Administrative Agent shall deliver to the requesting Lender the
accompanying certifications and such other instruments, documents, certifications
and approvals delivered by or on behalf of Borrower to Administrative Agent in
support of the requested Loan.

11.12.2 Nature of Obligations of Lenders. The obligations of the
Lenders hereunder are several and not joint. Failure of any Lender to fulfill its
obligations hereunder shall not result in any other Lender becoming obligated to
advance

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more than its Commitment Percentage of the Loan, nor shall such failure
release or diminish the obligations of any other Lender to fund its Commitment
Percentage provided herein.

11.12.3 Payments to Administrative Agent. All payments of principal or
and interest on the Loans or the Notes shall be made to the Administrative Agent by
the Borrower or any other obligor or guarantor for the account of the Lenders in
immediately available funds as provided in the Notes and this Agreement. The
Administrative Agent agrees promptly to distribute to each Lender, on the same
Business Day upon which each such payment is made if possible, such Lender’s
proportionate share of each such payment in immediately available funds, except as
otherwise expressly provided herein. The Administrative Agent shall upon each
distribution promptly notify Borrower of such distribution and each Lender of the
amounts distributed to it applicable to principal of, and interest on, the
proportionate share held by the applicable Lender. Each payment to the
Administrative Agent under the first sentence of this Section 11.12.3 shall
constitute a payment by the Borrower to each Lender in the amount of such Lender’s
proportionate share of such payment, and any such payment to the Administrative
Agent shall not be considered outstanding for any purpose after the date of such
payment by the Borrower to the Administrative Agent without regard to whether or
when the Administrative Agent makes distribution thereof as provided above. If any payment received by
the Administrative Agent from the Borrower is insufficient to pay both all accrued
interest and all principal then due and owing, the Administrative Agent shall first
apply such payment to all outstanding interest until paid in full and shall then
apply the remainder of such payment to all principal then due and owing, and shall
distribute the payment to each Lender accordingly.

11.12.4 Distribution of Liquidation Proceeds. Subject to the terms and
conditions hereof, the Administrative Agent shall distribute all Liquidation
Proceeds in the order and manner set forth below:

First: To the Administrative Agent, towards any fees and any expenses for
which the Administrative Agent is entitled to reimbursement under this
Agreement or the other Credit Documents not theretofore paid to the
Administrative Agent.

Second: To all applicable Lenders in accordance with their proportional
share based upon their respective Commitment Percentages until all Lenders
have been reimbursed for all expenses which such Lenders have previously
paid to the Administrative Agent and not theretofore paid to such Lenders.

Third: To all applicable Lenders based upon their respective Commitment
Percentages until all Lenders have been paid in full for any Individual
Lender Litigation Expenses.

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Fourth: To all Lenders in accordance with their proportional share based
upon their respective Commitment Percentages until all Lenders have been
paid in full all principal and interest due to such Lenders under the
Facility, with each Lender applying such proceeds for purposes of this
Agreement first against the outstanding principal balance due to such Lender
under the Facility and then to accrued and unpaid interest due under the
Facility.

Fifth: To all applicable Lenders in accordance with their proportional share
based upon their respective Commitment Percentages until all Lenders have
been paid in full all other amounts due to such Lenders under the Facility
including, without limitation, any costs and expenses incurred directly by
such Lenders to the extent such costs and expenses are reimbursable to such
Lenders by the Borrower under the Credit Documents.

Sixth: To the Borrower or such third parties as may be entitled to claim
Liquidation Proceeds.

11.12.5 Adjustments. If, after Administrative Agent has paid each
Lender’s proportionate share of any payment received or applied by Administrative
Agent in respect of the Facility, that payment is rescinded or must otherwise be
returned or paid over by Administrative Agent, whether pursuant to any bankruptcy or
insolvency law, sharing of payments clause of any agreement or otherwise, such
Lender shall, at Administrative Agent’s request, promptly return its proportionate
share of such payment or application to Administrative Agent, together with the
Lender’s proportionate share of any interest or other amount required to be paid by
Administrative Agent with respect to such payment or application.

11.12.6 Setoff. If any Lender (including the Administrative Agent),
acting in its individual capacity, shall exercise any right of setoff against a
deposit balance or other account of the Borrower held by such Lender on account of
the Borrower Obligations, such Lender shall remit to the Administrative Agent all
such sums received pursuant to the exercise of such right of setoff, and the
Administrative Agent shall apply all such sums for the benefit of all of the Lenders
hereunder in accordance with the terms of this Agreement.

11.12.7 Distribution by Administrative Agent. If in the opinion of the
Administrative Agent, distribution of any amount received by it in such capacity
hereunder or under the Notes or under any of the other Credit Documents might
involve any liability, it may refrain from making distribution until its right to
make distribution shall have been finally adjudicated by a court of competent
jurisdiction or has been resolved by the mutual consent of all Lenders. In
addition, the Administrative Agent may request full and complete indemnity, in form
and substance satisfactory to it, prior to making any such distribution. If a court
of competent jurisdiction shall adjudge that any amount received and

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distributed by the Administrative Agent is to be repaid, each person to whom any such distribution
shall have been made shall either repay to the Administrative Agent its
proportionate share of the amount so adjudged to be repaid or shall pay over the
same in such manner and to such persons as shall be determined by such court.

11.12.8 Actions by Administrative Agent. The Required Lenders may
direct the Administrative Agent in writing as to the method and the extent of any
sale or other disposition of any collateral or other property of Borrower and shall
indemnify and hold the Administrative Agent harmless from all liabilities incurred
in respect to all actions taken or omitted in accordance with such directions
provided that Administrative Agent need not comply with any such directions to the
extent Administrative Agent reasonably believes the Administrative Agent’s
compliance with such directions would constitute a violation of the obligations
undertaken by the Administrative Agent and/or Lenders under the Credit Documents, or
will constitute a violation of any statute, ordinance or regulation applicable to the Administrative Agent
or be commercially unreasonable in any applicable jurisdiction.

	 	11.13	 	Delinquent Lender. If for any reason any Lender shall fail or refuse
to abide by its obligations under this Agreement, including without limitation its
obligation to make available to Administrative Agent its pro rata share of any Loan,
expenses or setoff (a “Delinquent Lender”) and such failure is not cured within ten
(10) days of receipt from the Administrative Agent of written notice thereof, then, in
addition to the rights and remedies that may be available to Administrative Agent,
other Lenders, the Borrower or any other party at law or in equity, and not at
limitation thereof, (i) such Delinquent Lender’s right to participate in the
administration of, or decision-making rights related to, the Loans, this Agreement or
the other Credit Documents shall be suspended during the pendency of such failure or
refusal, and (ii) a Delinquent Lender shall be deemed to have assigned any and all
payments due to it from the Borrower, whether on account of the outstanding Loans,
interest, fees or otherwise, to the remaining non-delinquent Lenders for application
to, and reduction of, their proportionate shares of the outstanding Loans until, as a
result of application of such assigned payments the Lenders’ respective pro rata shares
of all the outstanding Loans shall have returned to those in effect immediately prior
to such delinquency and without giving effect to the nonpayment causing such
delinquency. The Delinquent Lender’s decision-making and participation rights to
payments as set forth in clauses (i) and (ii) hereinabove shall be restored only upon
the payment by the Delinquent Lender of its pro rata share of any Loans or expenses as
to which it is delinquent, together with interest thereon at the Default Rate from the
date when originally due until the date upon which any such amounts are actually paid.
	 
	 	 	 	The non-delinquent Lenders shall also have the right, but not the obligation, in
their respective, sole and absolute discretion, to acquire for no cash consideration,
(pro rata, based on the respective Commitments of those Lenders electing to exercise
such right) the Delinquent Lender’s Commitment to fund future Loans (the “Future

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Commitment”). Upon any such purchase of the pro rata share of any Delinquent Lender’s
Future Commitment, the Delinquent Lender’s share in future Loans and its rights under
the Credit Documents with respect thereto shall terminate on the date of purchase, and
the Delinquent Lender shall promptly execute all documents reasonably requested to
surrender and transfer such interest, including, if so requested, an Assignment and
Acceptance. Each Delinquent Lender shall indemnify Administrative Agent and each
non-delinquent Lender from and against any and all loss, damage or expenses, including
but not limited to reasonable attorneys’ fees and costs and funds advanced by
Administrative Agent or by any non-delinquent Lender, on account of any Delinquent
Lender’s failure to timely fund its pro rata share of a Loan or to otherwise perform
its obligations under the Credit Documents.

	 	11.14	 	Holders. The Administrative Agent may deem and treat the payee of any
Note as the owner thereof for all purposes hereof unless and until a written notice of
the assignment, transfer or endorsement thereof, as the case may be, shall have been
filed with the Administrative Agent. Any request, authority or consent of any person
or entity who, at the time of making such request or giving such authority or consent,
is the holder of any Note shall be conclusive and binding on any subsequent holder,
transferee or endorsee, as the case may be, of such Note or of any Note or Notes issued
in exchange therefor.
	 
	 	11.15	 	Assignment and Participation.

11.15.1 Conditions to Assignment by Lenders. Except as provided
herein, each Lender may assign to one or more Eligible Assignees all or a portion of
its interests, rights and obligations under this Agreement (including all or a
portion of its Commitment Percentage and Commitment and the same portion of the
Loans at the time owing to it and the Notes held by it), upon satisfaction of the
following conditions: (a) each of the Administrative Agent and the Borrower shall
have given its prior written consent to such assignment (provided that, in the case
of the Borrower, such consent will not be unreasonably withheld, conditioned or
delayed and shall not be required if a Default or Event of Default shall have
occurred and be continuing), (b) each such assignment shall be of a constant, and
not a varying, percentage of all the assigning Lender’s rights and obligations under
this Agreement, (c) other than when an Event of Default shall exist, each assignment
shall be in an amount that is at least Ten Million and 00/100 Dollars
($10,000,000.00), (d) other than when an Event of Default shall exist,
Administrative Agent shall retain, free of any such assignment, an amount of its
Commitment of not less than Eighty-Two Million Five Hundred Thousand and 00/100
Dollars ($82,500,000.00), and (e) the parties to such assignment shall execute and
deliver to the Administrative Agent, for recording in the Register (as hereinafter
defined), an Assignment and Acceptance, substantially in the form of Exhibit
D hereto (an “Assignment and Acceptance”), together with delivery of any Notes
subject to such assignment. Upon such execution, delivery, acceptance and
recording, from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be at least five (5) Business Days after the

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execution thereof, (x) the assignee thereunder shall be a party hereto and, to the
extent provided in such Assignment and Acceptance, have the rights and obligations
of a Lender hereunder, and (y) the assigning Lender shall, to the extent provided in
such Assignment and Acceptance and upon payment to the Administrative Agent of the
registration fee referred to in Section 11.15.3, be released from its obligations
under this Agreement.

11.15.2 Certain Representations and Warranties. By executing and
delivering an Assignment and Acceptance, the parties thereunder confirm to and agree
with each other and the other parties hereto as follows:

     (i) other than the representation and warranty that it is the legal and
beneficial owner of the interest being assigned thereby free and clear of any
adverse claim, the assigning Lender makes no representation or warranty, express or
implied, and assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of this
Agreement, the other Credit Documents or any other instrument or document furnished
pursuant hereto or the attachment, perfection or priority of any security interest;

     (ii) the assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower and its
affiliates, related entities or Subsidiaries or any other person primarily or
secondarily liable in respect of any of the Borrower Obligations, or the performance
or observance by the Borrower or any other person primarily or secondarily liable in
respect of any of the Borrower Obligations or any of their obligations under this
Agreement or any of the other Credit Documents or any other instrument or document
furnished pursuant hereto or thereto;

     (iii) such assignee confirms that it has received a copy of this Agreement and
the other Credit Documents, together with copies of the most recent financial
statements provided by the Borrower as required by the terms of this Agreement,
together with such other documents and information as it has deemed appropriate to
make its own credit analysis and decision to enter into such Assignment and
Acceptance;

     (iv) such assignee will, independently and without reliance upon the assigning
Lender, the Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement;

     (v) such assignee represents and warrants that it is an Eligible Assignee if
required hereunder;

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     (vi) such assignee appoints and authorizes the Administrative Agent to take
such action as agent on its behalf and to exercise such powers under this Agreement
and the other Credit Documents as are delegated to the Administrative Agent by the
terms hereof or thereof, together with such powers as are reasonably incidental
thereto;

     (vii) such assignee agrees that it will perform in accordance with their terms
all of the obligations that by the terms of this Agreement are required to be
performed by it as a Lender; and

     (viii) such assignee represents and warrants that it is legally authorized to
enter into such Assignment and Acceptance.

11.15.3 Register. The Administrative Agent shall maintain a copy of
each Assignment and Acceptance delivered to it and a register or similar list (the
“Register”) for the recordation of the names and addresses of the Lenders and the
Commitment Percentages of, and principal amount of the Loans owing to, the Lenders
from time to time. The entries in the Register shall be conclusive, in the absence
of manifest error, and the Borrower, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register as a Lender hereunder.
Administrative Agent shall make available the Register for inspection by the
Borrower and the Lenders at any reasonable time and from time to time upon
reasonable prior notice. Upon each such recordation, the assigning Lender agrees to
pay to the Administrative Agent a registration fee in the sum of Three Thousand Five
Hundred Dollars ($3,500.00).

11.15.4 New Notes. Upon its receipt of an Assignment and Acceptance
executed by the parties to such assignment, together with each Note subject to such
assignment, the Administrative Agent shall (a) record the information contained
therein in the Register, and (b) give prompt notice thereof to the Borrower and the
Lenders (other than the assigning Lender). Within five (5) Business Days after
receipt of such notice, the Borrower, at its own expense, shall execute and deliver
to the Administrative Agent, in exchange for each surrendered Note, a new Note to
the order of such Eligible Assignee pursuant to such Assignment and Acceptance and,
if the assigning Lender has retained some portion of its obligations hereunder, a
new Note to the order of the assigning Lender in an amount equal to the amount
retained by it hereunder. Such new Notes shall provide that they are replacements
for the surrendered Notes, shall be in an aggregate principal amount equal to the
aggregate principal amount of the surrendered Notes, shall be dated the effective
date of such Assignment and Acceptance and shall otherwise be substantially in the
form of the assigned Notes. Within thirty (30) days of issuance of any new Notes
pursuant to this Section 11.15.4, the Borrower, at the expense of the assignee
Lender (which expense shall not be reimbursed by Borrower), shall deliver an opinion
of counsel, addressed to the Lenders and the Administrative Agent, relating to the
due authorization, execution and delivery of such new Notes and the legality,
validity and binding

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effect thereof, in form and substance satisfactory to the
Lenders. The surrendered Notes shall be canceled and returned to the Borrower.

11.15.5 Participations. Each Lender may sell participations to one or
more banks or other financial institutions in all or any portion of such Lender’s
rights and obligations under this Agreement and the other Credit Documents; provided
that (a) each such participation shall be in a minimum amount of Five Million and
00/100 Dollars ($5,000,000.00), (b) each participant shall meet the requirements of
an Eligible Assignee, (c) any such sale or participation shall not affect the rights
and duties of the selling Lender hereunder to the Borrower, and (d) the only rights
granted to the participant pursuant to such participation arrangements with respect
to waivers, amendments or modifications of the Credit Documents shall be the rights
to approve waivers, amendments or modifications that would reduce the principal of
or the interest rate on any Loans, extend the term or increase the amount of the
Commitment of such Lender as it relates to such participant, reduce the amount of
any commitment fees to which such participant is entitled or extend any regularly
scheduled payment date for principal or interest.

	 	11.16	 	Disclosure. The Borrower agrees that in addition to disclosures made
in accordance with standard and customary banking practices any Lender may disclose
information obtained by such Lender pursuant to this Agreement to assignees or
participants and potential assignees or participants hereunder; provided that such
assignees or participants or potential assignees or participants shall agree (a) to
treat in confidence such information unless such information otherwise becomes public
knowledge, (b) not to disclose such information to a third party (other than its
advisors) except as required by law or legal process or to enforce the Credit Documents
and (c) not to make use of such information for purposes of transactions unrelated to
such contemplated assignment or participation.
	 
	 	11.17	 	Miscellaneous Assignment Provisions. Anything contained in this
Section 11 to the contrary notwithstanding, any Lender may at any time pledge all or
any portion of its interest and rights under this Agreement (including all or any
portion of its Notes) to any of the twelve Federal Reserve Banks organized under §4 of
the Federal Reserve Act, 12 U.S.C. §341. No such pledge or the enforcement thereof
shall release the pledgor Lender from its obligations hereunder or under any of the
other Credit Documents.
	 
	 	11.18	 	Reserved.

    11.19
Amendment, Waiver, Consent, Etc. Except as otherwise expressly provided in
this Agreement or any other Credit Document, no term or provision of this Agreement or any other
Credit Document may be changed, waived, discharged or terminated, nor may any consent required or
permitted by this Agreement or any other Credit Document be given, unless such change, waiver,
discharge, termination or consent receives the written approval of the Required Lenders.

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     Notwithstanding the foregoing, the unanimous written approval of all the
Lenders (other than a Defaulting Lender) shall be required with respect to any
proposed amendment, waiver, discharge, termination, or consent which:

(i) has the effect of (a) extending the final scheduled maturity or the date
of any amortization payment of any Loan or Note, (b) reducing the rate or
extending the time of payment of interest or fees thereon, (c) increasing or
reducing the principal amount thereof, or (d) otherwise postponing or
forgiving any indebtedness thereunder.

(ii) releases or discharges any material portion of any collateral other
than in accordance with the express provisions of the Credit Documents.

(iii) amends, modifies or waives any provisions of this paragraph.

(iv) amends any of the financial covenants set forth in Section 7.3 of this
Agreement.

(v) reduces the percentage specified in the definition of Required Lenders,

(vi) except as otherwise provided in this Agreement, changes the amount of
any Lender’s Commitment or Commitment Percentage, or

(vii) releases or waives any guaranty of the Borrower Obligations or
indemnifications provided in the Credit Documents;

     and provided, further, that without the consent of the Administrative Agent, no
such action shall amend, modify or waive any provision of this Section 11 or any
other provisions of any Credit Document which relates to the rights or obligations
of the Administrative Agent.

     Notwithstanding the foregoing, in the event that the Borrower or Administrative
Agent requests any consent, waiver or approval under this Agreement or any other
Credit Document, or an amendment or modification hereof or thereof, and one or more
Lenders determine not to consent or agree to such consent, waiver, approval,
amendment or modification, then the Lender then acting as Administrative Agent
hereunder shall have the right to purchase the Commitment of such non-consenting
Lender(s) at a purchase price equal to the then outstanding amount of principal,
interest and fees then owing to such Lender(s) by the Borrower hereunder, and such
non-consenting Lender(s) shall immediately upon request, sell and assign its
Commitment and all of its other right, title and interest in the Loans and other Borrower Obligations to the
Lender then acting as Administrative Agent pursuant to an Assignment and Assumption
(provided that the selling Lender(s) shall not be responsible to pay any assignment
fee in connection therewith).

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	 	11.20	 	Deemed Consent or Approval. With respect to any requested amendment,
waiver, consent or other action which requires the approval of the Required Lenders or
all of the Lenders, as the case may be in accordance with the terms of this Agreement,
or if the Administrative Agent is required hereunder to seek or desires to seek, the
approval of the Required Lenders or all of the Lenders, as the case may be, prior to
undertaking a particular action or course of conduct, the Administrative Agent in each
such case shall provide each Lender with written notice of any such request for
amendment, waiver or consent or any other requested or proposed action or course of
conduct, accompanied by such detailed background information and explanations as may be
reasonably necessary to determine whether to approve or disapprove such amendment,
waiver, consent or other action or course of conduct, the Administrative Agent may (but
shall not be required to) include in any such notice, printed in capital letters or
boldface type a legend substantially to the following effect:
	 
	 	 	 	“THIS COMMUNICATION REQUIRES IMMEDIATE RESPONSE, FAILURE TO RESPOND WITHIN TEN (10)
CALENDAR DAYS FROM THE RECEIPT OF THIS COMMUNICATION SHALL CONSTITUTE A DEEMED
APPROVAL BY THE ADDRESSEE OF THE ACTION REQUESTED BY THE BORROWER OR THE COURSE OF
CONDUCT PROPOSED BY THE ADMINISTRATIVE AGENT AND RECITED ABOVE.”
	 
	 	 	 	If the foregoing legend is included by the Administrative Agent in its communication,
a Lender shall be deemed to have approved or consented to such action or course of
conduct for all purposes hereunder if such Lender fails to object to such action or
course of conduct by written notice to the Administrative Agent within ten (10)
calendar days of such Lender’s receipt of such notice.
	 
	 	11.21	 	Borrower Indemnification of Lenders. In addition to the
indemnifications provided by Borrower to the Lenders otherwise provided herein or in
any other Credit Document, Borrower shall also indemnify Administrative Agent and
Lenders against any liability, cost or expense (including, without limitation,
reasonable attorneys’ fees and costs) incurred by the Administrative Agent and Lenders
as a result of any Environmental Claim related to any real estate or other assets held
by the Borrower or any other member of the Combined Group, provided that the same are
not due to the fraud or gross negligence of Administrative Agent or any Lender. The
Borrower will indemnify the Administrative Agent and Lenders against any liability,
cost or expense (including, without limitation, reasonable attorneys’ fees and costs)
incurred by the Administrative Agent and Lenders as a result of lawsuits and litigation that may arise
in connection with the activities of Borrower or any other member of the Combined
Group, provided that the same are not due to the fraud or gross negligence of
Administrative Agent or any Lender.
	 
	 	 	 	All indemnification provided by Borrower to Administrative Agent and Lenders,
including without limitation the aforementioned indemnifications, shall survive and
continue for the benefit of the indemnities thereunder, notwithstanding any

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termination of the Facility or payment in full of the obligations thereunder and hereunder.

	 	11.22	 	Borrower’s Communication with Lenders. Notwithstanding anything to
the contrary contained in this Agreement, prior to the occurrence of an Event of
Default, Borrower shall be entitled to rely on its communications with the
Administrative Agent as the agent of the Lenders, and may, but shall not be required
to, communicate separately with any Lender with respect to the Facility.

12. GENERAL PROVISIONS.

	 	12.1	 	Notices. Any notice or other communication in connection with this
Agreement, the Notes, or any of the other Credit Documents, shall be in writing, and
(i) deposited in the United States Mail, postage prepaid, by registered or certified
mail, (ii) hand delivered by any commercially recognized courier service or overnight
delivery service such as Federal Express, or (iii) sent by facsimile transmission, if a
FAX Number is designated below, provided a copy is also contemporaneously sent by any
commercially recognized courier service or overnight delivery service such as Federal
Express addressed:

If to Borrower:

Hines REIT Properties, L.P.

c/o Hines Interests Limited Partnership

2800 Post Oak Boulevard, Suite 5000

Houston, Texas 77056-6118

FAX Number: (713) 966-2636

Attention: Charles M. Baughn

     with copies by regular mail or such hand delivery or facsimile transmission to:

Hines REIT Properties, L.P.

c/o Hines Interests Limited Partnership

2800 Post Oak Boulevard, Suite 5000

Houston, Texas 77056-6118

FAX Number: (713) 966-7851

Attention: Charles N. Hazen

and

Baker Botts L.L.P.

2001 Ross Avenue

Dallas, Texas 75201-2980

FAX Number: (214) 953-6503

Attention: Curt Anderson, Esquire

If to Administrative Agent:

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KeyBank National Association

225 Franklin Street, 18th Floor

Boston, Massachusetts 02110

FAX Number: (617) 385-6293

Attention: Mr. John J. Murphy, Vice President

and

KeyBank National Association

127 Public Square, 2nd Floor

Cleveland, Ohio 44114-1306

FAX Number: (216) 689-5681

Attention: Robert C. Bowes, Esquire General Counsel

     with copies by regular mail or such hand delivery or facsimile transmission to:

Goulston & Storrs, P.C.

400 Atlantic Avenue

Boston, Massachusetts 02110

FAX Number: (617) 574-7607

Attention: James H. Lerner, Esquire

If to Lenders:

KeyBank National Association

225 Franklin Street, 18th Floor

Boston, Massachusetts 02110

FAX Number: (617) 385-6293

Attention: Mr. John J. Murphy, Vice President

     with a copy by regular mail or such hand delivery to:

Goulston & Storrs, P.C.

400 Atlantic Avenue

Boston, Massachusetts 02110

FAX Number: (617) 574-7607

Attention: James H. Lerner, Esquire

     and to such addresses as are set forth in any Assignment and Acceptance.

     Any such addressee may change its address for such notices to such other address in the United
States as such addressee shall have specified by written notice given as set forth above. All
periods of notice shall be measured from the deemed date of delivery as set forth in the next
succeeding paragraph.

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     A notice shall be deemed to have been given, delivered and received for the purposes of all
Credit Documents upon the earliest of: (i) if sent by such certified or registered mail, on the
third Business Day following the date of postmark, or (ii) if hand delivered at the specified
address by such courier or overnight delivery service, when so delivered or tendered for delivery
during customary business hours on a Business Day, or (iii) if so mailed, on the date of actual
receipt as evidenced by the return receipt, or (iv) if so delivered, upon actual receipt, or (v) if
facsimile transmission is a permitted means of giving notice, upon receipt as evidenced by
electronic confirmation from the sender’s fax machine of successful transmission if received during
normal business hours during a Business Day and otherwise on the next Business Day.

	 	12.2	 	Limitations on Assignment. Borrower may not assign this Agreement or
the monies due thereunder without the prior written consent of Administrative Agent and
the Required Lenders in each instance.
	 
	 	12.3	 	Further Assurance. Borrower shall upon request from Administrative
Agent or any Lender from time to time execute, seal, acknowledge and deliver such
further instruments or documents which Administrative Agent or any Lender may
reasonably require to better perfect and confirm its rights and remedies hereunder,
under the Notes, and under each of the other Credit Documents,
	 
	 	12.4	 	Parties Bound. The provisions of this Agreement and of each of the
other Credit Documents shall be binding upon and inure to the benefit of Borrower,
Administrative Agent and each of the Lenders and their respective successors and
assigns, except as otherwise prohibited by this Agreement or any of the other Credit
Documents.

     This Agreement is a contract by and among Borrower, Administrative Agent and each of the
Lenders for their mutual benefit, and no third person shall have any right, claim or interest
against either Administrative Agent, or any Lender or Borrower by virtue of any provision
hereof.

	 	12.5	 	Waivers and Extensions. Notwithstanding any contrary provision herein
or in any other Credit Document, Administrative Agent may, unless otherwise directed by
the Required Lenders or the same requires unanimous consent of the Lenders pursuant to
Section 11.19 hereof, at any time and from time to time waive any one or more of the
conditions contained herein or in any of the other Credit Documents, or extend the time
of payment of any Loan, but any such waiver or extension shall be deemed to be made in
pursuance and not in modification hereof, and any such waiver in any instance, or under
any particular circumstance, shall not be considered a waiver of such condition in any
other instance or any other circumstance.
	 
	 	12.6	 	Governing Law; Consent to Jurisdiction; Mutual Waiver of Jury Trial.

12.6.1 Substantial Relationship. It is understood and agreed that all
of the Credit Documents were negotiated, executed and delivered in the Commonwealth
of Massachusetts, which Commonwealth the parties agree has a substantial

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relationship to the parties and to the underlying transactions embodied by the
Credit Documents.

12.6.2 Place of Delivery. Borrower agrees to furnish to Administrative
Agent at the Administrative Agent’s office in Boston, Massachusetts all further
instruments, certifications and documents to be furnished hereunder.

12.6.3 Governing Law. This Agreement and each of the other Credit
Documents shall in all respects be governed, construed, applied and enforced in
accordance with the internal laws of the Commonwealth of Massachusetts without
regard to principles of conflicts of law.

12.6.4 Consent to Jurisdiction. Borrower hereby consents to personal
jurisdiction in any state or Federal court located within the Commonwealth of
Massachusetts.

12.6.5 JURY TRIAL WAIVER. BORROWER, ADMINISTRATIVE AGENT, AND EACH OF
THE LENDERS MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
BASED ON THIS AGREEMENT, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT
OR ANY OTHER CREDIT DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH, OR
ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR
ACTIONS OF ANY PARTY. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR BORROWER,
ADMINISTRATIVE AGENT AND EACH OF THE LENDERS TO ENTER INTO THE TRANSACTIONS
CONTEMPLATED HEREBY.

	 	12.7	 	Survival. All representations, warranties, covenants and agreements of
Borrower provided herein or in any other Credit Document, or in any notice,
certificate, or other paper delivered by or on behalf of Borrower pursuant hereto are
significant and shall be deemed to have been relied upon by Administrative Agent and
each of the Lenders notwithstanding any investigation made by Administrative Agent or
any Lender or on its behalf and shall survive the delivery of the Credit Documents and
the making of the Facility and each advance pursuant thereto. No review or approval by
Administrative Agent, or any Lender, or by Lenders’ consultants or any representatives,
of any plans and specifications, opinion letters, certificates by professionals or
other item of any nature shall relieve Borrower or anyone else of any of the
obligations, warranties or representations made by or on behalf of Borrower under any
one or more of the Credit Documents.
	 
	 	12.8	 	Cumulative Rights. All of the rights of Administrative Agent and the
Lenders hereunder and under each of the other Credit Documents and any other agreement
now or hereafter executed in connection herewith or therewith, shall be cumulative and
may be exercised singly, together, or in such combination as Administrative Agent may
determine in its sole judgment.

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	 	12.9	 	Claims Against Administrative Agent or the Lenders.

12.9.1 Borrower Must Notify. Administrative Agent and each of the
Lenders shall not be in default under this Agreement, or under any other Credit
Document, unless a notice specifically setting forth the claim of Borrower shall
have been given to Administrative Agent and each of the Lenders within thirty (30)
days after Borrower first had actual knowledge or actual notice of the occurrence of
the event which Borrower alleges gave rise to such claim and Administrative Agent
and each of the Lenders do not remedy or cure the default, if any there be, with
reasonable promptness thereafter.

12.9.2 Remedies. If it is determined by the final order of a court of
competent jurisdiction, which is not subject to further appeal, that Administrative
Agent or any Lender has breached any of their obligations under the Credit Documents
and has not remedied or cured the same with reasonable promptness following notice
thereof as required above, and the Administrative Agent’s and the Lenders’
responsibilities shall be limited to: (i) where the breach consists of the failure
to grant consent or give approval in violation of the terms and requirements of a
Credit Document, the obligation to grant such consent or give such approval and to
pay Borrower’s reasonable costs and expenses including, without limitation,
reasonable attorneys’ fees and disbursements in connection with such court
proceedings; (ii) where the breach consists of the failure to make a Loan, the
obligation to make such Loan and to pay Borrower’s reasonable costs and expenses
including, without limitation, reasonable attorneys’ fees and disbursements in
connection with such court proceedings; and (iii) in the case of any default by
Administrative Agent or any Lender, where it is also so determined that
Administrative Agent or any Lender acted in bad faith, or that Administrative
Agent’s or any Lenders’ default constituted gross negligence or willful misconduct,
the payment of any actual, direct, compensatory damages sustained by Borrower as a
result thereof plus Borrower’s reasonable costs and expenses, including, without
limitation, reasonable attorneys’ fees and disbursements in connection with such
court proceedings.

12.9.3 Limitations. In no event, however, shall Administrative Agent
or the Lenders be liable to Borrower or to anyone else for other damages such as,
but not limited to, indirect, speculative or punitive damages whatever the nature of
the breach by Administrative Agent or any Lender of its obligations under this
Agreement or under any of the other Credit Documents. In no event shall
Administrative Agent or any Lender be liable to Borrower or to anyone else unless a
notice specifically setting forth the claim of Borrower shall have been given to
Administrative Agent and each of the Lenders within the time period specified above.

	 	12.10	 	Obligations Absolute. Except to the extent prohibited by applicable
law which cannot be waived, the Borrower Obligations shall be absolute, unconditional
and irrevocable and shall be paid and/or performed strictly in accordance with the
terms of the Credit Documents under all circumstances whatsoever, including, without

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	 	 	 	limitation, the existence of any claim, set off, defense or other right which Borrower
may have at any time against Administrative Agent or any Lender whether in connection
with the Facility or any unrelated transaction.
	 
	 	12.11	 	Table of Contents, Title and Headings; Exhibits and Schedules. Any
table of contents and the titles and the headings of sections are not parts of this
Agreement or any other Credit Document and shall not be deemed to affect the meaning or
construction of any of their provisions. All exhibits and schedules attached hereto or
made a part hereof are incorporated by reference and constitute a part of this
Agreement.
	 
	 	12.12	 	Counterparts. This Agreement may be executed in several counterparts,
each of which when executed and delivered is an original, but all of which together
shall constitute one instrument. In making proof of this Agreement, it shall not be
necessary to produce or account for more than one such counterpart which is executed by
the party against whom enforcement of this Agreement is sought.
	 
	 	12.13	 	Integration. This Agreement, together with the other Credit
Documents, comprises the complete and integrated agreement of the parties to the Credit
Documents on the subject matter hereof and supersedes all prior agreements, written or
oral, on the subject matter hereof. Notwithstanding the foregoing, this Section 12.13
shall not be interpreted as integrating or superseding any agreements or understandings
relating to the refinancing of the Facility or any portion of the Borrower’s
Obligations hereunder pursuant to a separate agreement by one or more of the parties
hereto.
	 
	 	12.14	 	Time Of the Essence. Time is of the essence of each provision of this
Agreement and each other Credit Document.
	 
	 	12.15	 	No Oral Change. This Agreement and each of the other Credit Documents
may only be amended, terminated, extended or otherwise modified by a writing signed by
the party against which enforcement is sought (except no such writing shall be required
for any party which, pursuant to a specific provision of any Credit Document, is
required to be bound by changes without such party’s assent). In no event shall any
oral agreements, promises, actions, inactions, knowledge, course of conduct, course of
dealings or the like be effective to amend, terminate, extend or otherwise modify this
Agreement or any of the other Credit Documents.
	 
	 	12.16	 	Monthly Statements. While Administrative Agent may issue invoices or
other statements on a monthly or periodic basis (a “Statement”), it is expressly
acknowledged and agreed that, subject to the terms of Section 2.3.13 above: (i) the
failure of Administrative Agent to issue any Statement on one or more occasions shall
not affect Borrower’s obligations to make payments under the Credit Documents as and
when due; (ii) the inaccuracy of any Statement shall not be binding upon Administrative
Agent and Borrower shall always remain obligated to pay the full amount(s) required under
the Credit Documents as and when due notwithstanding any provision to the contrary
contained in any Statement; (iii) all

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Statements are issued for informational purposes
only and shall never constitute any type of offer, acceptance, modification, or waiver
of the Credit Documents or any of Administrative Agent’s or any Lender’s rights or
remedies thereunder; and (iv) in no event shall any Statement serve as the basis for,
or a component of, any course of dealing, course of conduct, or trade practice which
would modify, alter, or otherwise affect the express written terms of the Credit
Documents.

	 	12.17	 	Indemnification. The Borrower agrees to indemnify and hold harmless
the Administrative Agent and each of the Lenders and the shareholders, directors,
agents, officers, subsidiaries and affiliates of the Administrative Agent and each of
the Lenders from and against any and all claims, actions and suits, whether groundless
or otherwise, and from and against any and all liabilities, losses, settlement
payments, obligations, damages and expenses of every nature and character in connection
therewith, arising out of this Agreement or any of the other Credit Documents or the
transactions contemplated hereby or thereby or which otherwise arise in connection with
the financing, including, without limitation, the reasonable fees and disbursements of
counsel and allocated costs of internal counsel incurred in connection with any such
investigation, litigation or other proceeding, provided, however, that the Borrower
shall not be obligated under this Section 12.17 to indemnify any Person for (x)
liabilities arising from such Person’s own gross negligence, willful misconduct or
breach of this Agreement, as finally determined by a court of competent jurisdiction
(v) as to any dispute to the extent the same is exclusively among the Lenders, or (z)
any insolvency of a Lender if the same is caused by such Lender being a party to the
Credit Documents. If and to the extent that the obligations of the Borrower under this
Section 12.17 are unenforceable for any reason, the Borrower hereby agrees to make the
maximum contribution to the payment in satisfaction of such obligations which is
permissible under applicable law. The provisions of this Section 12.17 shall survive
the repayment of the amounts owing under the Notes and this Agreement and the
termination of this Agreement and the obligations of the Lenders hereunder and shall
continue in full force and effect as long as the possibility of any such claim, action,
cause of action or suit exists.

[Signature page follows]

-59-

 

     IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this
Agreement to be duly executed and delivered as an instrument under seal as of the date first above
written.

	 	 	 	 	 	 
	 	BORROWER:

HINES REIT PROPERTIES, L.P., a Delaware limited

partnership

 	 
	 	By: 	Hines Real Estate Investment Trust, Inc., a

Maryland corporation, its general partner

 
	 	 	By:  	/s/ Frank R. Apollo	 
	 	 	 	Name:  	Frank R. Apollo	 
	 	 	 	Title:  	Chief Accounting Officer	 
	 
	 
	 	ADMINISTRATIVE AGENT AND LENDER:

KEYBANK NATIONAL ASSOCIATION

as Administrative Agent and as a Lender

 	 
	 	By:  	 	/s/ John Murphy	 
	 	 	 	Name:  	John Murphy	 
	 	 	 	Title:  	Senior Vice President	 

 

 

	 	 	 	 	 

EXHIBITS:

	 	 	 	 	 
	 	 	 	 	Section Reference Number
	Exhibit A

	 	Definitions
	 	1.1 
	 
	 	 	 	 
	Exhibit B

	 	Assets, Funded Debt; Subsidiaries
	 	6.13, 6.16, 6.18, 7.2.13 and 7.5 
	 
	 	 	 	 
	Exhibit C

	 	Authorized Representatives
	 	4 
	 
	 	 	 	 
	Exhibit D

	 	Form of Assignment and Acceptance
	 	11.15.1 
	 
	 	 	 	 
	Exhibit E

	 	Lenders’ Commitment
	 	2.1(a) 
	 
	 	 	 	 
	Exhibit F

	 	Form of Note
	 	2.1(B) 
	 
	 	 	 	 
	Exhibit G

	 	Form of Certificate
	 	7.2.6 
	 
	 	 	 	 
	Exhibit H

	 	Intentionally Omitted	 	 
	 
	 	 	 	 
	Exhibit I

	 	Form of Notice of Borrowing
	 	2.1(c) 
	 
	 	 	 	 
	Exhibit J

	 	Environmental Notices
	 	6.15 
	 
	 	 	 	 
	Exhibit K

	 	Portfolio Investments
	 	3.2 
	 
	 	 	 	 
	Exhibit L

	 	Pro Forma Reduction Calculation
	 	3.2 (g) 

 

 

     EXHIBIT A TO AGREEMENT

     DEFINITIONS

     Adjusted Federal Funds Rate means the Federal Funds Rate plus fifty (50) basis points.

     Adjusted LIBOR Rate means the LIBOR Rate plus the Applicable Margin.

     Administrative Agent means KeyBank National Association acting as agent for the Lenders.

     Agreement as defined in the Preamble.

     Applicable Lending Office means, for each Lender, the office of such Lender (or of an
affiliate of such Lender) as such Lender may from time to time specify to the Administrative Agent
and the Borrower by written notice as the office by which its LIBOR Loans are made and maintained.

     Applicable Margin means one hundred twenty (120) basis points.

     Appraised Asset Value means the aggregate fair market value of the Portfolio Assets as
reflected in the most recent MAI Appraisals for each Portfolio Asset; provided that in the event an
MAI Appraisal is not available for a Portfolio Asset at the time of the calculation of the
aggregate fair market value of the Portfolio Assets, the fair market value of such Portfolio Asset
shall be equal to the value based upon (i) the cost of acquiring the Asset, which costs shall
include the purchase price, financing costs, and fees, expenses and costs relating thereto,
including fees and expenses of counsel; or (ii) to the extent available, (a) the annualized amount
of a Portfolio Asset’s net operating income based on the two (2) most recently completed full
fiscal quarters, less $0.50 per square foot of such Portfolio Asset’s leaseable space, divided by
(b) a capitalization rate of (x) 8.50% for “non-core” Portfolio Assets, or (y) 7.50% for “core”
Portfolio Assets (including Portfolio Assets in which the Core Fund invests). For the avoidance of
doubt, notwithstanding anything to the contrary contained herein, once an MAI Appraisal is
available for a Portfolio Asset, the fair market value for such Portfolio Asset shall be as
reflected in the most recent MAI Appraisal, and Borrower shall use best efforts to obtain updates
thereto on an annual basis at Borrower’s sole cost and expense.

     Assets means the real property owned in fee by Borrower or any other member of the Combined
Group.

     Assignment and Acceptance as defined in Section 11.15.1.

     Authorized Representatives as defined in Section 4 and listed on Exhibit C.

     Available For Distribution means that the amount in question (i) has been or is being
distributed to Borrower or (ii) upon the request of Borrower will be distributed to Borrower
without restriction, deduction or offset.

     Banking Day means a day on which banks are not required or authorized by law to close in the
city in which Administrative Agent’s principal office is situated.

     Bankruptcy Code means the Bankruptcy Code in Title 11 of the United States Code, as amended,
modified, succeeded or replaced from time to time.

     Borrower as defined in the Preamble.

     Borrower Escrow Account means that certain interest-bearing account established with KeyBank
National Association in the name of KeyBank National Association, as escrow agent for Borrower, or
such other escrow account as might be approved by Administrative Agent in its sole discretion, as
more particularly described in Section 3.3.

     Borrower Obligations means, without duplication, all of the obligations of the Borrower to the
Lenders and the Administrative Agent, whenever arising, under this Agreement, the Notes, or any of
the other Credit Documents to which the Borrower is a party.

     Borrower’s Ownership Interests as defined in Section 3.2(e).

     Borrower’s Pro Rata Share means, as to any referenced Subsidiary or other Portfolio Investment
Entity, or any Portfolio Assets, Indebtedness or other assets, liabilities, revenues, earnings,
costs and/or other interests, the greater of (1)

 

 

Borrower’s direct or indirect percentage ownership interest therein, or (2) in the case of
Indebtedness, the amount thereof that is recourse to the Borrower.

     Business Day means any day of the year on which offices of KeyBank National Association are
not required or authorized by law to be closed for business in Boston, Massachusetts. If any day
on which a payment is due is not a Business Day, then the payment shall be due on the next day
following which is a Business Day. Further, if there is no corresponding day for a payment in the
given calendar month (i.e., there is no “February 30th”), the payment shall be due on the last
Business Day of the calendar month.

     Change of Control means (i) any failure by the investment advisor for the General Partner to
be a Controlled Subsidiary of Hines Interests Limited Partnership (“HILP”); (ii) any failure by
HILP to be Controlled, directly or indirectly, and majority-owned, directly or indirectly by
Jeffrey C. Hines, Gerald D. Hines, their parents, brothers and sisters, and the spouses, children,
grandchildren (natural or adopted) of any of the foregoing, the estate of Jeffrey C. Hines and/or
Gerald D. Hines, any trust for any of the foregoing, and/or any entity owned by any combination of
the foregoing; or (iii) any failure by the Borrower to be Controlled by the General Partner.

     Closing Date means the date hereof.

     Code means the Internal Revenue Code of 1986 and the rules and regulations issued or
promulgated thereunder, as amended, modified, succeeded or replaced from time to time. References
to specific sections of the Code shall be construed also to refer to any successor sections.

          Collateral. The term “Collateral” shall mean and include the following property, wherever
located, and, to the extent provided in Section 3.2(a), any such property as the Borrower may
hereafter acquire or which may hereafter arise:

          (a) all of Pledgor’s right, title and interest in any interest (including, without limitation,
Borrower’s voting rights) in each Portfolio Investment described on Exhibit K as “Pledged
Interests” (all interests in Portfolio Investments included in the Collateral pursuant to this
clause (a) or clause (b) below are referred to herein as “Pledged Interests”);

          (b) all Portfolio Investments acquired by Borrower after the Closing Date; provided, however,
that, if the terms of any third party financing proposed to be obtained in connection with the
acquisition of any Portfolio Asset relating to any such Portfolio Investment would prohibit
Borrower from pledging in favor of Administrative Agent on behalf of Lenders one hundred percent
(100%) of such Portfolio Investment, then only that portion of such Portfolio Investment that is
permitted to be pledged under the terms of such financing (and, in each case, to the greatest
extent so permitted) shall be included in the Collateral; provided further, however, that in no
event shall less than forty nine percent (49%) of such Portfolio Investment be included in the
Collateral without the consent of Administrative Agent on behalf of Lenders, such consent not to be
unreasonably withheld or delayed;

          (c) all certificates or other instruments, if any, representing a Pledged Interest;

          (d) all Borrower’s income, cash flow, rights of distribution, dividends, interest, proceeds,
accounts, fees, profits, or other rights to payment which in any way relate to or arise out of the
Pledged Interests;

          (e) all rights of access arising from the Pledge Interests to books, records, information and
electronically stored data relating to any of the foregoing; and

 

 

          (f) the Borrower Escrow Account, including all funds deposited therein pursuant to Section 3.3
of this Agreement and any income earned on such funds.

     Combined Group means the Borrower, the Core Fund and each Subsidiary of Borrower from time to
time.

     Commitment means, with respect to each Lender, the commitment of such Lender in an aggregate
principal amount of up to such Lender’s Commitment Percentage of the Committed Amount to make Loans
in accordance with the provisions of Section 2.1(a).

     Commitment Fee as defined in Section 2.4.

     Commitment Percentage means, for each Lender, the percentage identified as its Commitment
Percentage on Exhibit E as such percentage may be modified by assignment in accordance with the
terms of this Agreement.

     Committed Amount means the Maximum Loan Amount.

     Consolidated Leverage Ratio means the ratio, expressed as a percentage, of Funded Debt
(including, without limitation, the outstanding balance under the Facility) over Total Asset Value.

     Control and Controlled (and grammatical variations thereof) mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management and policies of a
referenced Person and direct the day-to-day operations of such Person, whether through the
ownership of voting interests of such Person, by contract or otherwise.

     Core Fund means Hines-Sumisei U.S. Core Office Fund, L.P., a Delaware limited partnership.

     Credit Documents as defined in Section 3.1.

     Default means any event, act or condition which with notice or lapse of time, or both, would
constitute an Event of Default, as more particularly defined in Section 9.

     Default Rate means the Variable Rate plus 4% per annum.

     Delinquent Lender as defined in Section 11.13.

     Direction Letters means the letters delivered by Borrower to Administrative Agent pursuant to
which Portfolio Investment Entities that are not controlled by affiliates of Borrower are directed
to make distributions with respect to Portfolio Investments substantially in the form of Exhibit H.

     Dollars means lawful money of the United States.

     EBITDA means Net Operating Income less the sum of (x) all general and administrative fees and
expenses actually paid and asset management fees paid in cash by Borrower plus (y) Borrower’s Pro
Rata Share of (A) all administrative fees and expenses actually paid by any Portfolio Investment
Entity or any Person in which any Portfolio Investment Entity has a direct or indirect interest,
and (B) asset management fees paid in cash by any Portfolio Investment Entity or any Person in
which any Portfolio Investment Entity has a direct or indirect interest, in each case to the extent
Borrower is directly or indirectly subject thereto. (For example, asset management fees paid by
the Core Fund are not included in this calculation, because the Borrower does not bear any of the
cost of any such asset management fees in respect of its interest in the Core Fund.) For the
avoidance of doubt, the calculation of EBITDA provided for in this definition shall not duplicate
the deduction of any expenses accounted for in the definition of Net Operating Income and shall not
include any organizational or offering expenses paid from offering proceeds.

     Eligible Assignee means any of (a) a commercial bank organized under the laws of the United
States, or any State thereof or the District of Columbia and having total assets in excess of
$1,000,000,000; (b) a savings and loan association or savings bank organized under the laws of the
United States, or any State thereof or the District of Columbia, and having a net worth of at least
$100,000,000 calculated in accordance with generally accepted accounting principles; (c) a
commercial bank organized under the laws of any other country which is a member of the Organization
for Economic Cooperation and Development (the “OECD”), or a political subdivision of any such
country, and having total assets in excess of $1,000,000,000,

 

 

provided that such bank is acting through a branch or agency located in the country in which
it is organized or another country which is also a member of the OECD; and (d) the central bank of
any country which is a member of the OECD which has total assets in excess of $1,000,000,000.

     Environmental Claim means any investigation, written notice, violation, written demand,
action, suit, injunction, judgment, order, consent decree, penalty, fine, lien, proceeding, or
written claim whether administrative, judicial, or private in nature arising (a) pursuant to, or in
connection with, an actual or alleged violation of, any Environmental Law, (b) in connection with
any Hazardous Material, (c) from any assessment, abatement, removal, remedial, corrective, or other
response action in connection with an Environmental Law or other order of a Governmental Authority
or (d) from any actual or alleged environmental damage, injury, threat, or harm to health, safety,
natural resources, or the environment.

     Environmental Indemnity has the meaning assigned in Section 5.5.

     Environmental Law(s) means any current or future requirement of any Governmental Authority
pertaining to (a) in connection with Hazardous Materials or environmental matters, the protection
of health, safety, and the indoor or outdoor environment, (b) in connection with Hazardous
Materials or environmental matters, the conservation, management, or use of natural resources and
wildlife, (c) in connection with Hazardous Materials or environmental matters, the protection or
use of surface water and groundwater, (d) the management, manufacture, possession, presence, use,
generation, transportation, treatment, storage, disposal, release, threatened release, abatement,
removal, remediation or handling of, or exposure to, any Hazardous Material or (e) pollution
(including, without limitation, any release to land surface water and groundwater) and includes,
without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 USC 9601 et seq.,
Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976 and
Hazardous and Solid Waste Amendment of 1984, 42 USC 6901 et seq., Federal Water Pollution Control
Act, as amended by the Clean Water Act of 1977, 33 USC 1251 et seq., Clean Air Act of 1966, as
amended, 42 USC 7401 et seq., Toxic Substances Control Act of 1976, 15 USC 2601 et seq., Hazardous
Materials Transportation Act, 49 USC App. 1801 et seq., Occupational Safety and Health Act of 1970,
as amended, 29 USC 651 et seq. (to the extent only that the same relates to environmental matters),
Oil Pollution Act of 1990, 33 USC 2701 et seq., Emergency Planning and Community Right-to-Know Act
of 1986, 42 USC 111001 et seq. (to the extent only that the same relates to environmental matters),
National Environmental Policy Act of 1969, 42 USC 4321 et seq., Safe Drinking Water Act of 1974, as
amended, 42 USC 300(f) et seq., any analogous implementing or successor law, and any amendment,
rule, regulation, order, or binding directive issued thereunder.

     ERISA as defined in Section 6.8.

     Event of Default as defined in Section 9.1.

     Facility as defined in Section 1.3.

     Federal Funds Rate means, for any day, the rate per annum (rounded upwards, if necessary, to
the nearest 1/100 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 as so published on the next
succeeding 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 charged to the Administrative
Agent (in its individual capacity) on such day on such transactions as determined by the
Administrative Agent.

     Fee Letter means the fee and expense letter of even date between the Administrative Agent and
the Borrower.

     Fees means all fees payable pursuant to Section 2.4.

     Fixed Charges means, for any period, the sum of (i) Interest Expense, plus (ii) principal
amortization of any Indebtedness of Borrower and Borrower’s Pro Rate Share of any principal
amortization of any Indebtedness of any Portfolio Entity or any Person in which any Portfolio
Entity has a direct or indirect interest, plus (iii) dividends on preferred stock issued by
Borrower and Borrower’s Pro Rata Share of dividends on preferred stock issued by any Portfolio
Entity or any Person in which any Portfolio Entity has a direct or indirect interest, in each case
during such period.

     Funded Debt means, as of any date, all Indebtedness and Guaranty Obligations of Borrower and
Borrower’s Pro Rata Share of all Indebtedness and Guaranty Obligations of the Portfolio Investment
Entities and of all Persons in which any Portfolio

 

 

Investment Entity has a direct or indirect interest as of such date; provided, that Funded
Debt shall not include any liabilities shown on the Borrower’s balance sheet as “due to affiliates”
that are subordinate to the Facility.

     Funded Debt Documents as defined in Section 6.16.

     Future Commitment as defined in Section 11.13.

     GAAP means generally accepted accounting principles in the United States applied on a
consistent basis and subject to Section 1.4, and, with respect to assets located outside the United
States, subject to generally accepted accounting principles as applied in the jurisdiction where
such foreign assets are located.

     General Partner means the general partner of the Borrower, as such general partner is
identified in Section 6.6.3.

     Governmental Authority means any federal, state, local, provincial or foreign court or
governmental agency, authority, instrumentality or regulatory body.

     Guarantor means Hines Real Estate Investment Trust, Inc., a Maryland corporation.

     Guaranty means that certain Unconditional Guaranty of Payment and Performance dated of even
date herewith and executed by Guarantor in favor of Administrative Agent and the Lenders.

     Guaranty Obligations means any obligations (other than endorsements in the ordinary course of
business of negotiable instruments for deposit or collection) guaranteeing any Indebtedness,
leases, dividends or other obligations of any other Person in any manner, whether direct or
indirect, and including, without limitation, any obligation, whether or not contingent, (a) to
purchase any such Indebtedness or other obligation or any property constituting security therefor;
(b) to advance or provide funds or other support for the payment or purchase of such Indebtedness
or obligation or to maintain working capital, solvency or other balance sheet condition of such
other Person (including without limitation keep well agreements, maintenance agreements, comfort
letters or similar agreements or arrangements), (c) to lease or purchase property, securities or
services primarily for the purpose of assuring the owner of such Indebtedness or obligation, or (d)
to otherwise assure or hold harmless the owner of such Indebtedness or obligation against loss in
respect thereof.

     Hazardous Materials means and includes asbestos, flammable materials, explosives, radioactive
substances, polychlorinated biphenyls, radioactive substances, other carcinogens, oil and other
petroleum products, pollutants or contaminants that could be a detriment to the environment, and
any other hazardous or toxic materials, wastes, or substances which are defined, determined or
identified as such in any past, present or future Environmental Laws.

     Illinois Property means the property located at 321 North Clark Street, Chicago, Illinois.

     Indebtedness means, with respect to any Person at any time, without duplication, (a) all
indebtedness for borrowed money outstanding at such time, (b) the deferred purchase price of assets
or services which in accordance with GAAP would be shown to be a liability (or on the liability
side of a balance sheet) at such time, (c) all Guaranty Obligations of such Person outstanding at
such time, (d) the maximum amount of all letters of credit issued for the account of such Person
and, without duplication, all drafts drawn thereunder and not reimbursed at such time, (e) all
capitalized lease obligations outstanding at such time, (f) all Indebtedness of another Person
outstanding at such time secured by any Lien on any property of such Person, whether or not such
Indebtedness has been assumed (limited to the greater of (i) the amount of such Indebtedness as to
which there is recourse to such Person at such time and (ii) the fair market value of the property
which is subject to the Lien), (g) all obligations existing at such time under take-or-pay or
similar arrangements or under interest rate, currency, or commodities agreements, (h) indebtedness
outstanding at such time created or arising under any conditional sale or title retention
agreement, (i) obligations of such Person outstanding at such time with respect to withdrawal
liability or insufficiency under ERISA or under any Plan and (j) the principal portion of all
obligations of such Person outstanding at such time under any synthetic lease, tax retention
operating lease, off balance sheet loan or similar off balance sheet financing product of such
Person where such transaction is considered borrowed money indebtedness for tax purposes but is
classified as an operating lease in accordance with GAAP; provided, however, that Indebtedness
shall not include trade payables and accrued expenses arising or incurred in the ordinary course of
business. The Indebtedness of any Person shall include the Indebtedness of any partnership or
unincorporated joint venture in which such Person is legally obligated with respect thereto (to the
extent of such obligation) and shall include all Indebtedness of such Person under this Agreement.

     Individual Lender Litigation Expenses means all costs and expenses (including, without
limitation, reasonable attorneys’ fees and costs) incurred by any individual Lender in any
litigation concerning the Facility in which such Lender has

 

 

been named as a party defendant, but only to the extent such costs and expenses are
reimbursable to such Lender by the Borrower under the Credit Documents.

     Interest Expense means, for any period, the aggregate amount of interest paid by Borrower
during such period on any Indebtedness of Borrower (including the Facility) plus Borrower’s Pro
Rata Share of all interest paid during such period on any Indebtedness of any Portfolio Investment
Entity or of any Person in which a Portfolio Investment Entity has a direct or indirect interest.

     Interest Payment Date means (a) as to Variable Rate Loans, the last day of each calendar month
and the Maturity Date, and (b) as to LIBOR Loans, the last day of each calendar month and the
Maturity Date; provided, however, if such day is not a Business Day, then the Interest Payment Date
shall be (x) as to the Variable Rate Loans, the next day following that is a Business Day and (y)
as to LIBOR Loans, the next day following that is a Business Day unless such Business Day is in the
next calendar month in which case the Interest Payment Date shall be the immediately preceding
Business Day.

     Interest Period.

     (A) The term “Interest Period” means with respect to each LIBOR Loan: a period of one (1), two
(2), or three (3) consecutive months, subject to availability, as selected, or deemed selected, by
Borrower at least three (3) Business Days prior to the Loan, or if a Loan is already outstanding,
at least three (3) Business Days prior to the end of the current Interest Period with respect to
that Loan. Each such Interest Period shall commence on the Business Day so selected, or deemed
selected, by Borrower and shall end on the numerically corresponding day in the first, second, or
third month thereafter, as applicable. Provided, however: (i) if there is no such numerically
corresponding day, such Interest Period shall end on the last Business Day of the applicable month,
(ii) if the last day of such an Interest Period would otherwise occur on a day which is not a
Business Day, such Interest Period shall be extended to the next succeeding Business Day; but (iii)
if such extension would otherwise cause such last day to occur in a new calendar month, then such
last day shall occur on the next preceding Business Day.

     (B) The term “Interest Period” shall mean with respect to each Variable Rate Loan consecutive
periods of one (1) day each.

     (C) No Interest Period may be selected which would extend beyond the then current Maturity
Date of the Facility (as actually extended).

     Investment shall mean the acquisition of any real or tangible personal property, stock or
other interest (whether economic, legal or beneficial and whether direct or indirect), security,
loan, advance, bank deposit, money market fund, contribution to capital, extension of credit
(except for accounts receivable arising in the ordinary course of business and payable in
accordance with customary terms), or purchase or commitment or option to purchase or otherwise
acquire real estate or tangible personal property or stock or other interests or securities of any
party or any part of the business or assets comprising such business, or any part thereof.

     Late Charges as defined in Section 2.3.15.

     Legal Requirements means all applicable federal, state, county and local laws, by-laws, rules,
regulations, codes and ordinances, and the requirements of any governmental agency or authority
having or claiming jurisdiction with respect thereto, including, but not limited to, those
applicable to zoning, subdivision, building, health, fire, safety, sanitation, the protection of
the handicapped, and environmental matters and shall also include all orders and directives of any
court, governmental agency or authority having or claiming jurisdiction with respect thereto.

     Lenders as defined in the Preamble.

     LIBOR Rate Loan or LIBOR Loan means any principal outstanding under this Agreement which bears
interest at a rate determined by the LIBOR Rate.

     LIBOR Rate means, as applicable to any LIBOR Loan, the rate per annum (rounded upward, if
necessary, to the nearest one hundred-thousandth of a percentage point) as determined on the basis
of the offered rates for deposits in U.S. dollars, for a period of time comparable to such LIBOR
Loan which appears on the Telerate page 3750 as of 11:00 a.m. London time on the day that is two
(2) London Banking Days preceding the first day of such LIBOR Loan; provided, however, if the rate
described above does not appear on the Telerate System on any applicable interest determination
date, the LIBOR Rate shall be the rate (rounded upwards as described above, if necessary)
determined on the basis of the offered rates for deposits in U.S. dollars for a period of time
comparable to such LIBOR Loan which are offered by four major banks in the London interbank market
at approximately 11:00 a.m. London time, on the day that is two (2) London Banking Days preceding
the first day of such

 

 

LIBOR Loan as selected by Lender. The principal London office of each of the four major
London banks will be required to provide a quotation of its U.S. dollars deposit offered rate. If
at least two such quotations are provided, the rate for that date will be the arithmetic mean of
the quotations. If fewer than two quotations are provided as requested, the rate for that date
will be determined on the basis of the rates quoted for loans in U.S. dollars to leading European
banks for a period of time comparable to such LIBOR Loan offered by major banks in New York City at
approximately 11:00 a.m. New York City time, on the day that is two London Banking Days preceding
the first day of such LIBOR Loan. In the event that Lender is unable to obtain any such quotation
as provided above, it will be deemed that the LIBOR Rate for a LIBOR Loan cannot be determined. In
the event that the Board of Governors of the Federal Reserve System shall impose a Reserve
Percentage with respect to LIBOR Rate deposits of Lender, then for any period during which such
Reserve Percentage shall apply, the LIBOR Rate shall be equal to the amount determined above
divided by an amount equal to 1 minus the Reserve Percentage. “Reserve Percentage” shall mean the
maximum aggregate reserve requirement (including all basic, supplemental, marginal and other
reserves) which is imposed on member banks of the Federal Reserve System against “Euro-Currency
Liabilities” as defined in Regulation D.

     Lien means any mortgage, pledge, hypothecation, assignment, deposit arrangement, security
interest, encumbrance, lien (statutory or otherwise), preference, priority or charge of any kind
(including any agreement to give any of the foregoing), any conditional sale or other title
retention agreement, any financing or similar statement or notice perfecting a security interest
under the Uniform Commercial Code as adopted and in effect in the relevant jurisdiction, or other
similar recording or notice statute, and any lease in the nature thereof. Provided, however, liens
for the payment of real estate taxes and for other state, municipal or utility charges shall not be
considered “Liens” for purposes of the Facility to the extent that such liens relate to taxes and
other charges that are not then due and payable.

     Liquidation Proceeds means, without duplication, the proceeds and cash recovered by or paid to
Administrative Agent and the Lenders during an Event of Default.

     Loan or Loans as defined in Section 2.1(a).

     London Banking Day means any day on which dealings in deposits in Dollars are transacted in
the London interbank market.

     MAI Appraisal means real property appraisal(s) of the value of any Portfolio Asset, determined
on a market value basis, performed and prepared, impartially by an independent MAI qualified
appraiser(s) that is reasonably acceptable to the Administrative Agent, (provided, however, CB
Richard Ellis and Cushman & Wakefield shall be deemed acceptable for the purposes hereof). Each
such MAI Appraisal shall have been prepared in accordance with the Uniform Standards of
Professional Appraisal Practice and the Financial Institutions Reform, Recovery, and Enforcement
Act of 1989.

     Mandatory Prepayments as defined in Section 2.3.10(b)(i).

     Make Whole Provision as set forth in Section 2.3.16.

     Material Adverse Effect means a material adverse effect on (i) the condition (financial or
otherwise), operations, business, assets, liabilities or prospects of the Borrower, (ii) the
ability of the Borrower to perform any material obligation under the Credit Documents to which it
is a party, or (iii) the material rights and remedies of the Administrative Agent or any Lender
under the Credit Documents.

     Maturity shall mean the Maturity Date, or in any instance, upon acceleration of the
indebtedness under the Facility, if such indebtedness has been accelerated by Administrative Agent.

     Maturity Date as defined in Section 2.2.

     Maximum Loan Amount means One Hundred Sixty-Five Million Dollars ($165,000,000.00) as the same
may be reduced pursuant to the terms of this Agreement.

     Net Cash Flow means, for any period and without duplication, the sum of (a) dividends in
connection with marketable securities owned by Borrower and interest income earned by Borrower on
its cash and Investments plus (b) the portion of the following amount (without duplication) that is
Available for Distribution to Borrower from its Investments: (i) Borrower’s Pro Rata Share of all
cash received from all of Borrower’s Investments, including without limitation, all rents, common
area maintenance charges, insurance premiums and tax reimbursements and proceeds from rental
interruption insurance, but specifically excluding any proceeds from any casualty or condemnation
related to, or from the refinancing of or the sale or other disposition of, any of Borrower’s
Investments (unless approved by Administrative Agent and other than where the primary business of a
Portfolio Investment Entity is the sale of individual residential condominiums or units; with
respect to the sale of

 

 

individual residential condominiums or units actually closed during the applicable quarter,
Net Cash Flow shall be calculated based on the actual sale proceeds of such units closed in the
applicable quarter less the actual costs of such units), minus (ii) Borrower’s Pro Rata Share of
the sum of the following costs and expenses paid in cash in connection with Borrower’s Investments
during such period: (A) all Capital Expenditures other than Capital Expenditures made with either
the proceeds of Funded Debt or the proceeds of additional equity contributions made by Borrower,
plus (B) any and all costs and expenses of a non-capital nature, including but not limited to,
operating, maintenance, administrative, legal and accounting expenses (unless already deducted when
reserved pursuant to the following subclause (C) plus (C) without duplication of any cost or
expense in the preceding subclause (B), amounts reserved for taxes, insurance and replacement
reserves in accordance with the past practices of the entity that owns such Investment, plus (D)
all interest and principal payments made in respect of Funded Debt.

     Net Operating Income means, for any period and without duplication, Borrower’s Pro Rata Share
of the following amount: (i) all operating revenues from all Portfolio Assets, including without
limitation, all rents, common area maintenance charges, insurance premium and tax reimbursements
and proceeds from rental interruption insurance, but specifically excluding revenues from
extraordinary events, any proceeds from any casualty or condemnation related to, or from the
refinancing of or the sale or other disposition of, any Portfolio Assets minus (ii) the sum of the
following costs and expenses incurred in connection with Portfolio Assets during such period: (A)
any and all costs and expenses of a non-capital nature, including but not limited to, operating,
maintenance, administrative, legal and accounting expenses (unless already deducted when reserved
pursuant to the following subclause (B)) but excluding payments on Funded Debt plus (B) without
duplication of any cost or expense in the preceding subclause (A), amounts reserved for taxes,
insurance and replacement reserves in accordance with the past practices of the entity that owns
such investment, plus (C) a capital expense reserve equal to $.50 per square foot of the Portfolio
Assets per annum calculated on a pro rata basis for any period less than one (1) year.

     Net Sales Proceeds means, with respect to the Borrower, the aggregate cash proceeds received
by the Borrower in respect of any Portfolio Disposition by the Borrower, or cash distributions to
Borrower from the aggregate cash proceeds of Portfolio Distributions by another Person, net of (a)
all reasonable and customary direct costs (including, without limitation, legal, accounting and
investment banking fees, and sales commissions), (b) taxes paid or payable as a result thereof and
(c) existing Indebtedness (other than the Facility) repaid with the proceeds received from such
Portfolio Disposition; it being understood that “Net Sales Proceeds” shall include, without
limitation, Borrower’s Pro Rata Share of any cash received upon the financing, sale or other
disposition of any non cash consideration received in any Portfolio Disposition to the extent
Borrower receives such cash.

     Notes means the promissory notes payable to each of the Lenders in the aggregate principal
amount of One Hundred Sixty-Five Million and 00/100 Dollars ($165,000,000.00), substantially in the
form of Exhibit F attached hereto, with the term “Note” meaning any one of the Notes, as the same
may be amended, extended, renewed, supplemented, modified or restated from time to time and
including any additional Notes which may be delivered in accordance with the terms of this
Agreement.

     Other Taxes as defined in Section 2.3.4.2(b).

     Partnership Agreement means that certain Second Amended and Restated Agreement of Limited
Partnership of Hines REIT Properties, L.P., dated as of May 25, 2004, as may be amended or modified
from time to time hereafter in accordance with the terms hereof.

     Perfected Interest shall mean an assignment of ownership or economic interest in favor of
Administrative Agent on behalf of Lenders in effect with respect to a Portfolio Investment.

     Permitted Investment means all Investments reflected on the financial statements of Borrower
heretofore delivered to Administrative Agent and all Investments of a substantially similar type,
the Portfolio Investment Entities in which Borrower has an interest as of the date hereof and which
have been identified to Administrative Agent, all Investments held by Borrower through such
Portfolio Investment Entities as of the date hereof, including the Illinois Property, and all other
Investments hereafter made by Borrower which Administrative Agent consents to being Permitted
Investments, such consent not to be unreasonably withheld.

     Permitted Liens means (a) Liens created by, under or in connection with this Agreement or the
other Credit Documents in favor of the Administrative Agent for the benefit of the Lenders or
evidenced by the Funded Debt Documents listed on Exhibit B; (b) Liens for taxes not yet due or
Liens for taxes being contested in good faith by appropriate proceedings for which adequate
reserves have been established (and as to which the property subject to such Lien is not yet
subject to foreclosure, sale or loss on account thereof); (c) Liens in respect of property imposed
by law arising in the ordinary course of business such as materialmen’s, mechanics’, warehousemen’s
and other like Liens; provided that such Liens secure only amounts not yet due and payable or
amounts being contested in good faith by appropriate proceedings for which adequate reserves have
been established (and as to which the property subject to such Lien is not yet subject to
foreclosure, sale or loss on account thereof); (d) pledges or

 

 

deposits made to secure payment under worker’s compensation insurance, unemployment insurance,
pensions, social security programs, public liability laws or similar legislation; (e) any
attachment or judgment Lien, unless the judgment it secures is not, within 30 days after entry
thereof, discharged or the execution thereof stayed pending appeal, or is not discharged within 30
days after the expiration of such stay; (f) Liens securing Indebtedness permitted under Section
7.4; or (g) Liens on any Portfolio Investment, including any transfer restrictions thereon,
pursuant to (i) the terms of any organizational documents to which such Portfolio Investment is
subject to or (ii) the terms of any instrument representing or governing such Portfolio Investment.

     Permitted Portfolio Disposition as defined in Section 3.2(d).

     Person means any individual, partnership, joint venture, firm, corporation, limited liability
company, association, trust or other entity or enterprise (whether or not incorporated), or any
Governmental Authority.

     Plan means any “multiemployer plan” or “single-employer plan” as defined in Section 4001 of
ERISA which the Borrower sponsors, maintains or contributes to or has any liability.

     Plan Assets means such term within the meaning and as defined in the Department of Labor
Regulation 29 CFR §2510.3-101, as amended, modified, succeeded or replaced from time to time and
the advisory opinions and rulings issued thereunder.

     Pledge Agreement means that certain Ownership Interests Pledge and Security Agreement dated as
of even date herewith executed by Borrower for the benefit of Administrative Agent and Lenders, as
may be amended from time to time in accordance with this Agreement.

     Portfolio Asset means any real property asset directly or indirectly held by a Portfolio
Investment Entity.

     Portfolio Disposition means any disposition of all or any portion of any or all of the
Portfolio Investments of Borrower or Portfolio Assets by a Subsidiary of Borrower, whether by sale,
transfer or otherwise, other than leasing of space in a Portfolio Asset in the normal course of
business.

     Portfolio Investment means all of Borrower’s interest as a general partner, limited partner,
member or shareholder (including, without limitation, Borrower’s voting rights) in any Portfolio
Investment Entity.

     Portfolio Investment Entity means a Person in which Borrower has a direct ownership interest
and which directly or indirectly holds interests in real property; provided, however, that the term
“Portfolio Investment Entity” shall not include either Hines REIT 1515 S Street LP or Hines REIT
1515 S Street GP LLC.

     Prime Rate means the per annum rate of interest so designated from time to time by KeyBank
National Association as its prime rate. The Prime Rate is a reference rate and does not
necessarily represent the lowest or best rate being charged to any customer.

     Register as defined in Section 11.15.3.

     Regulation D, G, T, U or X means, respectively, Regulation D, G, T, U and X of the Board of
Governors of the Federal Reserve System as from time to time in effect and any successor to all or
a portion thereof.

     REIT means a “real estate investment trust”, as such term is defined in Section 856 of the
Code.

     Reportable Event as defined in Section 6.8.

     Required Lenders means, at any time, Lenders which are then in compliance with their
obligations hereunder (as determined by the Administrative Agent) and holding in the aggregate at
least sixty-six and two thirds percent (66 2/3%) of (i) the Commitments (and participation
interests therein) or (ii) if the Commitments have been terminated, the outstanding Loans and
participation interests therein.

     Required Reduction shall have the meaning set forth in Section 3.2(g).

     Reserve Percentage shall have the meaning set forth within the definition of LIBOR Rate.

     Security Documents shall mean, collectively, the Pledge Agreement and the related UCC-1
Financing Statements.

 

 

     Senior Agent shall have the meaning set forth in Section 7.5.

     Senior Credit Facility shall have the meaning set forth in Section 7.5.

     Senior Credit Lenders shall have the meaning set forth in Section 7.5.

     Senior Security Interest shall have the meaning set forth in Section 7.5.

     Solvent means, with respect to any Person as of a particular date, that on such date (a) such
Person is able to pay its debts and other liabilities, contingent obligations and other commitments
as they mature in the normal course of business, (b) such Person does not intend to, and does not
believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts
and liabilities mature in their ordinary course, (c) such Person is not engaged in a business or a
transaction, and is not about to engage in a business or a transaction, for which such Person’s
assets would constitute unreasonably small capital after giving due consideration to the prevailing
practice in the industry in which such Person is engaged or is to engage, (d) the fair value of the
assets of such Person is greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person and (e) the present fair salable value of the
assets of such Person is not less than the amount that will be required to pay the probable
liability of such Person on its debts as they become absolute and matured. In computing the amount
of contingent liabilities at any time, it is intended that such liabilities will be computed at the
amount which, in light of all the facts and circumstances existing at such time, represents the
amount that would be expected to become an actual or matured liability.

     Subsidiary means as to any Person (a) any corporation more than 50% of whose stock of any
class or classes having by the terms thereof ordinary voting power to elect a majority of the
directors of such corporation (irrespective of whether or not at the time, any class or classes of
stock of such corporation shall have or might have voting power by reason of the happening of any
contingency) is at the time owned by such Person directly or indirectly through Subsidiaries, and
(b) any partnership, association, joint venture or other entity in which such Person directly or
indirectly through Subsidiaries has at least a 50% equity interest or Controls such entity at any
time.

     Tangible Net Worth means the excess of Total Asset Value over Funded Debt.

     Taxes shall having the meaning set forth in Section 2.3.4.2(a).

     Term as defined in Section 2.2.

     Total Asset Value means the sum of (a) Borrower’s Pro Rata Share of the Appraised Asset Value
of the Portfolio Assets, (b) unrestricted cash then held by Borrower and Borrower’s Pro Rata Share
of any unrestricted cash held by any Portfolio Investment Entity or any Person in which a Portfolio
Investment Entity has a direct or indirect interest, plus (c) the value of unencumbered marketable
securities then owned by Borrower and Borrower’s Pro Rata Share of the value of unencumbered
marketable securities then owned by any Portfolio Investment Entity or any Person in which a
Portfolio Investment Entity has a direct or indirect interest, in each case as determined by the
closing price thereof on a major exchange on the last Business Day of the relevant calendar quarter
or, if applicable, on such other Business Day as to which Total Asset Value is being determined.

     UCC means the Uniform Commercial Code in effect in the Commonwealth of Massachusetts and in
each jurisdiction in which the Portfolio Assets are situated, as the same may be amended from time
to time.

     Variable Rate means a per annum rate equal at all times to the greater of (a) Prime Rate and
(b) Adjusted Federal Funds Rate. Changes in the Variable Rate shall be effective simultaneously
with any change in the Prime Rate or Federal Funds Rate, as applicable.

     Variable Rate Loan means any Loan bearing interest at a rate determined by reference to the
Variable Rate.

 

 

PROMISSORY NOTE

			
	$165,000,000
	 	April 24, 2006

     1. Promise To Pay.

     FOR VALUE RECEIVED, HINES REIT PROPERTIES, L.P., a Delaware limited partnership, having an
address at c/o Hines Interests Limited Partnership, 2800 Post Oak Boulevard, Suite 5000, Houston,
Texas 77056-6118 (the “Borrower”) promises to pay to the order of KEYBANK NATIONAL ASSOCIATION, a
national banking association having an address at 127 Public Square, Cleveland, Ohio 44114
(“Lender”), the principal sum of ONE HUNDRED SIXTY-FIVE MILLION DOLLARS ($165,000,000.00) or so
much thereof as may be advanced from time to time, with interest thereon, or on the amount thereof
from time to time outstanding, to be computed, as hereinafter provided, on each advance from the
date of its disbursement until such principal sum shall be fully paid. Interest shall be payable
at such rates and amounts and in installments as provided in the Agreement (as defined below). The
total principal sum, or the amount thereof outstanding, together with any accrued but unpaid
interest, shall be due and payable in full on August 22, 2006 subject however to acceleration, in
accordance with the Agreement (as defined below) pursuant to which this Note has been issued (as so
accelerated, the “Maturity Date”).

     2. Term Loan Agreement.

     This Note is issued pursuant to the terms, provisions and conditions of an agreement captioned
“Term Loan Agreement” (as the same may be amended the “Agreement”) dated as of even date by and
among Borrower, Lender, and KeyBank National Association as Administrative Agent for itself and for
such other financial institutions as may become parties to the Agreement (the Lender and such other
institutions are collectively referred to herein as the “Lenders”), and the Agreement evidences the
Facility (as defined in the Agreement) and the Loans (as defined in the Agreement) made pursuant
thereto. Capitalized terms used herein which are not otherwise specifically defined herein shall
have the same meaning herein as in the Agreement.

     3. Acceleration; Event of Default.

     To the extent permitted in the Agreement, this Note and the indebtedness evidenced hereby
shall become immediately due and payable without further notice or demand, and notwithstanding any
prior waiver of any breach or default, or other indulgence, during the existence at any time of any
one or more of the events defined in the Agreement as an “Event of Default”.

     4. Certain Waivers, Consents and Agreements.

     Each and every party liable hereon or for the indebtedness evidenced hereby whether as maker,
endorser, guarantor, surety or otherwise hereby: (a) waives presentment, demand, protest,
suretyship defenses and defenses in the nature thereof; (b) waives any defenses based upon and

1

 

specifically assents to any and all extensions and postponements of the time for payment, changes
in terms and conditions and all other indulgences and forbearances which may be granted by the
holder to any party now or hereafter liable hereunder or for the indebtedness evidenced hereby; (c)
agrees to any substitution, exchange, release, surrender or other delivery of any security or
collateral now or hereafter held hereunder or in connection with the Agreement, or any of the other
Credit Documents, and to the addition or release of any other party or person primarily or
secondarily liable; (d) agrees that if any security or collateral given to secure this Note or the
indebtedness evidenced hereby or to secure any of the obligations set forth or referred to in the
Agreement, or any of the other Credit Documents, shall be found to be unenforceable in full or to
any extent, or if Administrative Agent or any other party shall fail to duly perfect or protect
such collateral, the same shall not relieve or release any party liable hereon or thereon nor
vitiate any other security or collateral given for any obligations evidenced hereby or thereby; (e)
to the extent required by the terms of the Agreement, agrees to pay all costs and expenses incurred
by Administrative Agent and Lenders or any other holder of this Note in connection with the
collection of the indebtedness evidenced hereby and the enforcement of rights and remedies
hereunder or under the other Credit Documents, whether or not suit is instituted and certain other
costs or expenses incurred by Administrative Agent and/or the Lender as provided in the Agreement;
and (f) consents to all of the terms and conditions contained in this Note, the Agreement, and all
other instruments now or hereafter executed evidencing or governing all or any portion of the
Borrower Obligations or the security or collateral for this Note and for such Agreement, or any one
or more of the other Credit Documents to which such Person is a party.

     5. Delay Not A Bar.

     No delay or omission on the part of the holder in exercising any right hereunder or any right
under any instrument or agreement now or hereafter executed in connection herewith, or any
agreement or instrument which is given or may be given to secure the indebtedness evidenced hereby
or by the Agreement, or any other agreement now or hereafter executed in connection herewith or
therewith shall operate as a waiver of any such right or of any other right of such holder, nor
shall any delay, omission or waiver on any one occasion be deemed to be a bar to or waiver of the
same or of any other right on any future occasion.

     6. Partial Invalidity.

     The invalidity or unenforceability of any provision hereof, of the Agreement, of the other
Credit Documents, or of any other instrument, agreement or document now or hereafter executed in
connection with the Facility made pursuant hereto and thereto shall not impair or vitiate any other
provision of any of such instruments, agreements and documents, all of which provisions shall be
enforceable to the fullest extent now or hereafter permitted by law.

     7. Compliance With Usury Laws.

     All agreements between Borrower, Administrative Agent, and Lenders are hereby expressly
limited so that in no contingency or event whatsoever, whether by reason of acceleration of
maturity of the indebtedness evidenced hereby or otherwise, shall the amount paid or agreed to be
paid to Administrative Agent or Lenders for the use or the forbearance of the

2

 

indebtedness evidenced hereby exceed the maximum permissible under applicable law. As used herein,
the term “applicable law” shall mean the law in effect as of the date hereof, provided, however,
that in the event there is a change in the law which results in a higher permissible rate of
interest, then this Note shall be governed by such new law as of its effective date. In this
regard, it is expressly agreed that it is the intent of Borrower, Administrative Agent and Lenders
in the execution, delivery and acceptance of this Note to contract in strict compliance with the
laws of the Commonwealth of Massachusetts from time to time in effect. If, under or from any
circumstances whatsoever, fulfillment of any provision hereof or of any of the other Credit
Documents at the time performance of such provision shall be due, shall involve transcending the
limit of validity prescribed by applicable law, then the obligation to be fulfilled shall
automatically be reduced to the limit of such validity, and if under or from any circumstances
whatsoever Administrative Agent or Lenders should ever receive as interest an amount which would
exceed the highest lawful rate, such amount which would be excessive interest shall be applied to
the reduction of the principal balance evidenced hereby and not to the payment of interest. This
provision shall control every other provision of all agreements among Borrower, Administrative
Agent, and Lenders.

     8. Use of Proceeds.

     All proceeds of the Facility shall be used solely for the purposes more particularly provided
for and limited by the Agreement.

     9. Security.

     This Note is secured by certain Security Documents as are more particularly described in the
Agreement and is further secured by other Collateral as set forth in the Agreement.

     10. Notices.

     Any notices given with respect to this Note shall be given in the manner provided for in the
Agreement.

     11. Governing Law and Consent to Jurisdiction.

     11.1. Substantial Relationship. It is understood and agreed that all of the Credit Documents
were negotiated, executed and delivered in the Commonwealth of Massachusetts, which State the
parties agree has a substantial relationship to the parties and to the underlying transactions
embodied by the Credit Documents.

     11.2. Place of Delivery. Borrower agrees to furnish to Administrative Agent at Administrative
Agent’s office in Boston, Massachusetts all further instruments, certifications and documents to be
furnished hereunder.

     11.3. Governing Law. This Note and each of the other Credit Documents, shall in all respects
be governed, construed, applied and enforced in accordance with the internal laws of the
Commonwealth of Massachusetts without regard to principles of conflicts of law.

3

 

     11.4. Consent to Jurisdiction. The Borrower hereby consents to personal jurisdiction in
any state or Federal court located within the Commonwealth of Massachusetts.

     12. Waiver of Jury Trial.

     BORROWER, ADMINISTRATIVE AGENT AND LENDERS MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE OR ANY OTHER CREDIT DOCUMENTS CONTEMPLATED TO BE
EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR
LENDER TO ACCEPT THIS NOTE AND MAKE THE FACILITY.

     13. No Oral Change.

     This Note and the other Credit Documents may only be amended, terminated, extended or
otherwise modified by a writing signed by the party against which enforcement is sought. In no
event shall any oral agreements, promises, actions, inactions, knowledge, course of conduct, course
of dealing, or the like be effective to amend, terminate, extend or otherwise modify this Note or
any of the other Credit Documents.

     14. Rights of the Holder.

     This Note and the rights and remedies provided for herein may be enforced by
Administrative Agent or any holder hereof. Wherever the context permits each reference to the term
“holder” herein shall mean and refer to Administrative Agent or the then holder of this Note.

     15. Survival.

     This Note shall survive and continue in full force and effect beyond and after the payment and
satisfaction of the Borrower Obligations in the event that Administrative Agent or any Lender is
required to disgorge or return any payment or property received as a result of any laws pertaining
to preferences, fraudulent transfers or fraudulent conveyances but such survival and continuation
shall be limited to the amount of such disgorgement or return.

[Signature Page Follows]

4

 

     IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed as of the date set forth
above as a sealed instrument at Boston, Massachusetts.

	 	 	 	 	 	 	 	 	 
	 	 	BORROWER:
	 
	 	 	 	 	 	 	 	 
	 	 	HINES REIT PROPERTIES, L.P., a Delaware limited partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Hines Real Estate Investment Trust, Inc., a
Maryland corporation, its general partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Frank Apollo
	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:	 	Frank Apollo
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Title:	 	Chief Accounting Officer
	 

	 	 	 	 	 	 	 	 

5exv10w61

 

Exhibit 10.61

UNCONDITIONAL GUARANTY OF PAYMENT AND PERFORMANCE

     FOR AND IN CONSIDERATION OF the sum of Ten and 00/100 Dollars ($10.00) and other good and
valuable consideration paid or delivered to the undersigned HINES REAL ESTATE INVESTMENT TRUST,
INC., a Maryland corporation (hereinafter referred to as “Guarantor”), the receipt and sufficiency
whereof are hereby acknowledged by Guarantor, and for the purpose of seeking to induce KEYBANK
NATIONAL ASSOCIATION, as agent (“Agent”) for itself and the other lenders (the “Lenders”) which may
become parties to a certain Term Loan Agreement dated April 24, 2006 (the “Loan Agreement”) to
extend credit or otherwise provide financial accommodations to Hines REIT Properties, L.P.
(hereinafter referred to as “Borrower”), which extension of credit and provision of financial
accommodations will be to the direct interest, advantage and benefit of Guarantor. Capitalized
terms used herein but not otherwise defined herein shall have the meanings assigned to such terms
in the Loan Agreement. Guarantor does hereby absolutely, unconditionally and irrevocably guaranty
to Agent the complete payment and performance of the following Borrower Obligations:

	 	(a)	 	the full and prompt payment when due, whether by acceleration or otherwise, either before
or after maturity thereof, in accordance with the terms of the Loan Agreement, of those
outstanding Notes made by Borrower to the order of each Lender in the aggregate principal amount
equal to the then outstanding aggregate principal amount of the Loans (which amount shall not
exceed One Hundred Sixty-Five Million and 00/100 Dollars ($165,000,000.00) in the aggregate)
together with interest as provided in the Loan Agreement, together with any renewals,
modifications, consolidations, restatements and extensions thereof; and
	 
	 	(b)	 	the full and prompt payment and performance of all of the other Borrower Obligations of
Borrower to Agent and the Lenders under the terms of the Loan Agreement, the Environmental
Indemnity, the Pledge Agreement and each other Credit Document to which Borrower is a party.

	1.	 	Agreement to Pay and Perform; Costs of Collection. Guarantor does hereby agree that if any
Note is not paid by Borrower in accordance with its terms, or if any and all sums which are
now or may hereafter become due from Borrower to Agent and/or the Lenders under the Credit
Documents are not paid by Borrower in accordance with their terms, or if any and all other
Borrower Obligations are not performed by Borrower in accordance with their terms, Guarantor
will immediately make such payments and perform such Borrower Obligations. Guarantor further
agrees to pay Agent and/or the Lenders on demand all costs and

-1-

 

	 	 	expenses (including court costs
and reasonable attorneys’ fees and disbursements)
paid or incurred by Agent and/or the Lenders in endeavoring to collect the Borrower
Obligations, to enforce any of the Borrower Obligations, or any portion thereof, or to
enforce this Guaranty, and until paid to Agent and/or the Lenders, such sums shall bear
interest at the Default Rate unless collection from Guarantor of interest at such rate
would be contrary to applicable law, in which event such sums shall bear interest at the
highest rate which may be collected from Guarantor under applicable law. Any payment or
other performance of the Borrower Obligations by Guarantor under this Guaranty shall result
in, (i) with respect to any payments made, a corresponding reduction in the amount of
Borrower Obligations, and (ii) with respect to any performance other than payments made,
Borrower being deemed to have fulfilled such performance.
	 
	2.	 	Rights of Agent and/or the Lenders to Deal with Collateral, Borrower and Other Persons.
Guarantor hereby consents and agrees that Agent and/or the Lenders may at any time, and from
time to time, without thereby releasing Guarantor from any liability hereunder and without
notice to or further consent from Guarantor, either with or without consideration: (i) release
or surrender any Collateral, lien or other security of any kind or nature whatsoever held by
it or by any Person on its behalf or for its account, securing any of the Borrower
Obligations; (ii) substitute for any Collateral so held by it, other collateral of any kind;
(iii) modify the terms of any Credit Document except to the extent the consent of Borrower is
required to make any such modifications; (iv) extend or renew the Note for any period except
to the extent the consent of Borrower is required to make any such modifications; (v) grant
releases, compromises and indulgences with respect to any Credit Document and to any Persons
now or hereafter liable thereunder or hereunder; (vi) release any other guarantor, surety,
endorser or accommodation party of any Credit Document; or (vii) take or fail to take any
action of any type whatsoever under this Guaranty or any Credit Document. No such action
which Agent and/or the Lenders shall take or fail to take in connection with any Credit
Document, or any Collateral securing the payment of the Borrower Obligations to Agent and/or
the Lenders or for the performance of any of the Borrower Obligations or other undertakings of
Borrower, nor any course of dealing with Borrower or any other Person, shall release
Guarantor’s obligations hereunder, affect this Guaranty in any way or afford Guarantor any
recourse against Agent and/or the Lenders. The provisions of this Guaranty shall extend and
be applicable to all renewals, amendments, extensions, consolidations, restatements and
modifications of any Credit Document, and any and all references herein to any Credit Document
shall be deemed to include any such renewals, extensions, amendments, consolidations,
restatements or modifications thereof.

	3.	 	No Contest with Agent/Lender; Subordination. So long as any Borrower Obligation remains
unpaid or undischarged, Guarantor will not, by paying any sum recoverable hereunder
(whether or not demanded by Agent and/or the

-2-

 

	 	 	Lenders) or by any means or on any other ground, claim any set-off or counterclaim against Borrower in respect of any liability of
Borrower to Guarantor or, in proceedings under federal bankruptcy law or insolvency proceedings of any
nature, prove in competition with Agent and/or the Lenders in respect of any payment
hereunder or be entitled to have the benefit of any counterclaim or proof of claim or
dividend or payment by or on behalf of Borrower or the benefit of any other security for
any Borrower Obligation which, now or hereafter, Agent and/or the Lenders may hold or in
which it may have any share. Guarantor hereby subordinates any and all indebtedness of
Borrower now or hereafter owed to Guarantor to all of the Borrower Obligations, and agrees
with Agent and/or the Lenders that during the existence of an Event of Default (a)
Guarantor shall not demand or accept any payment from Borrower on account of such
indebtedness, (b) Guarantor shall not claim any offset or other reduction of Guarantor’s
obligations hereunder because of any such indebtedness, and (c) Guarantor shall not take
any action to obtain any interest in any of the Collateral because of any such
indebtedness.
	 
	4.	 	Waiver of Defenses. Guarantor hereby agrees that its obligations hereunder shall not be
affected or impaired by, and hereby waives and agrees not to assert or take advantage of any
defense based on:

	 	(a)	 	any statute of limitations in any action hereunder or for the collection, payment or
performance of any of the Borrower Obligations;
	 
	 	(b)	 	the incapacity or lack of authority of Borrower or any other Person, the death or
disability of Borrower or Guarantor or any other Person, or the failure of Agent and/or the
Lenders to file or enforce a claim against the estate (either in administration, bankruptcy or in
any other proceeding) of Borrower or Guarantor or any other Person;
	 
	 	(c)	 	the dissolution or termination of existence of Borrower;
	 
	 	(d)	 	the voluntary or involuntary liquidation, sale or other disposition of all or
substantially all of the assets of Borrower;
	 
	 	(e)	 	the voluntary or involuntary receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, assignment, composition, or readjustment of, or any similar
proceeding affecting, Borrower or Guarantor, or any of Borrower’s or Guarantor’s properties or
assets;
	 
	 	(f)	 	the failure of Agent and/or the Lenders to give notice of the existence, creation or
incurrence of any new or additional Borrower Obligations or of

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	 	 	 	any action or nonaction on the part
of any other Person whomsoever in connection with any obligation hereby guaranteed;
	 
	 	(g)	 	any failure or delay of Agent and/or the Lenders to commence an action against
Borrower, to assert or enforce any remedies against Borrower under any Credit Document, or to
realize upon any Collateral or other security.
	 
	 	(h)	 	any failure of any duty on the part of Agent and/or the Lenders to disclose to Guarantor
any facts it may now or hereafter know regarding Borrower, whether such facts materially increase
the risk to Guarantor or not;
	 
	 	(i)	 	failure to accept or give notice of acceptance of this Guaranty by Agent and/or the
Lenders;
	 
	 	(j)	 	failure to make or give notice of presentment and demand for payment or performance of
any of the Borrower Obligations;
	 
	 	(k)	 	failure to make or give protest and notice of dishonor or of default to Guarantor
or to any other party to any of the Credit Documents with respect to any of the Borrower
Obligations;
	 
	 	(l)	 	failure to give any and all other notices whatsoever to which Guarantor might
otherwise be entitled other than notice of a claim being brought under this Guaranty;
	 
	 	(m)	 	any lack of diligence by Agent and/or the Lenders in collection, protection or realization
upon any Collateral securing the payment or performance of the Borrower Obligations;
	 
	 	(n)	 	the invalidity or unenforceability of any Note, the Loan Agreement or any other Credit
Document;
	 
	 	(o)	 	the compromise, settlement, release or termination of any or all of the Borrower
Obligations with respect to any portion of the Borrower Obligations not satisfied pursuant to such
compromise, settlement, release or termination;
	 
	 	(p)	 	any transfer by Borrower of all or any part of the Collateral securing the Borrower
Obligations;
	 
	 	(q)	 	the failure of Agent and/or the Lenders to perfect any security or to extend or renew the
perfection of any security; or

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	 	(r)	 	to the fullest extent permitted by law, any other legal, equitable or surety defenses
whatsoever to which Guarantor might otherwise be entitled, it
being the intention that the obligations of Guarantor hereunder are
absolute, unconditional and irrevocable.

	5.	 	Guaranty of Payment and Performance and Not of Collection. This is a Guaranty of payment and
performance and not of collection. The liability of Guarantor under this Guaranty shall be
primary, direct and immediate and not conditional or contingent upon the pursuit of any
remedies against Borrower or any other Person, nor against Collateral or other securities or
liens available to Agent and/or the Lenders, its successors, successors in title, endorsees or
assigns. Guarantor hereby waives any right to require that an action be brought against
Borrower or any other Person or to require that resort be had to the Collateral, any other
security or to any balance of any deposit account or credit on the books of Agent and/or the
Lenders in favor of Borrower or any other Person.
	 
	6.	 	Rights and Remedies of Agent/Lender. Upon the occurrence of an Event of Default, Agent shall
have the right to enforce its rights, powers and remedies under the Loan Agreement, any other
Credit Documents, hereunder or under any other agreement, document or instrument now or
hereafter evidencing, securing or otherwise relating to the Borrower Obligations, in any
order, and all rights, powers and remedies available to Agent in such event shall be
nonexclusive and cumulative of all other rights, powers and remedies provided thereunder or
hereunder or by law or in equity. Accordingly, Guarantor hereby authorizes and empowers Agent
upon the occurrence of any Event of Default, at its sole discretion, and without notice to
Guarantor, to exercise any right or remedy which Agent may have, as to any Collateral, whether
real, personal or intangible. At any public or private sale of any Collateral for any of the
Borrower Obligations, Agent may, in its discretion, purchase all or any part of such
Collateral so sold or offered for sale for its own account and may apply against the amount
bid therefor all or any part of the balance due it pursuant to the terms of the Loan
Agreement, the Notes, or any other Credit Document without prejudice to Agent’s remedies
hereunder against Guarantor for deficiencies. If the Borrower Obligations are partially paid
by reason of the election of Agent to pursue any of the remedies available to Agent, or if
such Borrower Obligations are otherwise partially paid, this Guaranty shall nevertheless
remain in full force and effect, and Guarantor shall remain liable for the entire remaining
balance of the Borrower Obligations even though any rights which Guarantor may have against
Borrower may be destroyed or diminished by the exercise of any such remedy.
	 
	7.	 	Application of Payments. Guarantor hereby authorizes Agent and/or the Lenders, without
notice to Guarantor, to apply all payments and credits received from Borrower or from
Guarantor or realized from any Collateral or other security in

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	 	 	the manner set forth in applicable provisions of the Loan Agreement or any other
Credit Document, and for purposes of such provisions, the Guarantor’s obligations
hereunder shall be considered part of the Borrower Obligations.
	 
	8.	 	Business Failure, Bankruptcy or Insolvency. In the event of the business failure of
Guarantor or if there shall be pending any bankruptcy or insolvency case or proceeding with
respect to Guarantor under federal bankruptcy law or any other applicable law or in connection
with the insolvency of Guarantor, or if a liquidator, receiver, or trustee shall have been
appointed for Guarantor or Guarantor’s properties or assets, Agent may file such proofs of
claim and other papers or documents as may be necessary or advisable in order to have the
claims of Lenders allowed in any proceedings relative to Guarantor, or any of Guarantor’s
properties or assets, and, irrespective of whether the Borrower Obligations shall then be due
and payable, by declaration or otherwise, Agent shall be entitled and empowered to file and
prove a claim for the whole amount of any sums or sums owing with respect to the Borrower
Obligations, and to collect and receive any moneys or other property payable or deliverable on
any such claim.
	 
	9.	 	Changes in Writing; No Revocation. This Guaranty may not be changed orally, and no
obligation of Guarantor can be released or waived by Agent except by a writing signed by a
duly authorized officer of Agent. This Guaranty shall be irrevocable by Guarantor until
all of the Borrower Obligations have been completely repaid and performed.

11. Notices. All notices, demands or requests provided for or permitted to be given pursuant to
this Guaranty must be in the manner provided in the Loan Agreement and, if to Guarantor, at the
following address:

Hines Real Estate Investment Trust, Inc.

c/o Hines Interests Limited Partnership

2800 Post Oak Boulevard, Suite 5000

Houston, Texas 77056-6118

FAX Number:  (713) 966-2636

Attention: Charles M. Baughn

with a copy to:

Baker Botts L.L.P.

30 Rockefeller Plaza

New York, NY 10112-4498

FAX No.:          (212) 408-2509

Attention: Brayton Dresser, Esquire

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	12.	 	Governing Law. Guarantor acknowledges and agrees that this Guaranty and the obligations of
Guarantor hereunder shall be governed by and interpreted and
determined in accordance with the laws of The Commonwealth of Massachusetts (excluding the
laws applicable to conflicts or choice of law).
	 
	13.	 	CONSENT TO JURISDICTION; WAIVERS. GUARANTOR HEREBY
IRREVOCABLY AND UNCONDITIONALLY (A) SUBMITS TO PERSONAL JURISDICTION IN THE COMMONWEALTH OF
MASSACHUSETTS OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
GUARANTY, AND (B) WAIVES ANY AND ALL PERSONAL RIGHTS UNDER THE LAWS OF ANY STATE (I) TO THE
RIGHT, IF ANY, TO TRIAL BY JURY, (II) TO OBJECT TO JURISDICTION WITHIN THE COMMONWEALTH OF
MASSACHUSETTS OR VENUE IN ANY PARTICULAR FORUM WITHIN THE COMMONWEALTH OF MASSACHUSETTS,
AND (III) TO THE RIGHT, IF ANY, TO CLAIM OR RECOVER ANY SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN ACTUAL DAMAGES. GUARANTOR AGREES THAT, IN
ADDITION TO ANY METHODS OF SERVICE OF PROCESS PROVIDED FOR UNDER APPLICABLE LAW, ALL
SERVICE OF PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING MAY BE MADE BY CERTIFIED OR
REGISTERED MAIL, RETURN RECEIPT REQUESTED, DIRECTED TO GUARANTOR AT THE ADDRESS SET FORTH
IN PARAGRAPHS 11 AND 17(c) HEREIN, AND SERVICE SO MADE SHALL BE COMPLETE FIVE (5) DAYS
AFTER THE SAME SHALL BE SO MAILED. NOTHING CONTAINED HEREIN, HOWEVER, SHALL PREVENT LENDER
FROM BRINGING ANY SUIT, ACTION OR PROCEEDING OR EXERCISING ANY RIGHTS AGAINST ANY SECURITY
AND AGAINST GUARANTOR PERSONALLY, AND AGAINST ANY PROPERTY OF GUARANTOR, WITHIN ANY OTHER
STATE. INITIATING SUCH SUIT, ACTION OR PROCEEDING OR TAKING SUCH ACTION IN ANY STATE SHALL
IN NO EVENT CONSTITUTE A WAIVER OF THE AGREEMENT CONTAINED HEREIN THAT THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS SHALL GOVERN THE RIGHTS AND OBLIGATIONS OF GUARANTOR AND
LENDER HEREUNDER OR OF THE SUBMISSION HEREIN MADE BY GUARANTOR TO PERSONAL JURISDICTION
WITHIN THE COMMONWEALTH OF MASSACHUSETTS.
	 
	14.	 	Successors and Assigns. The provisions of this Guaranty shall be binding upon Guarantor and
its heirs, successors, successors in title, legal representatives, and assigns, and shall inure
to the benefit of Agent, the Lenders, its successors, successors in title, legal representatives
and assigns.

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	15.	 	Assignment by Lender. This Guaranty is assignable by the Agent and the Lenders in whole or
in part in conjunction with any assignment of any Note or portions thereof, and any assignment
hereof or any transfer or assignment of any
Note or portions thereof by the Lenders shall operate to vest in any such assignee the
rights and powers, in whole or in part, as appropriate, herein conferred upon and granted
to Agent and the Lenders.
	 
	16.	 	Severability. If any term or provision of this Guaranty shall be determined to be illegal or
unenforceable, all other terms and provisions hereof shall nevertheless remain effective and
shall be enforced to the fullest extent permitted by law.
	 
	17.	 	Miscellaneous.

	 	(a)	 	The guaranteed Obligations are intended to be used solely for commercial or business
purposes and not for any personal, family or household purpose.
	 
	 	(b)	 	The Guarantor agrees that any impairment of the Guarantor’s rights of subrogation or
reimbursement shall not affect the Guarantor’s obligations under this Guaranty.
	 
	 	(c)	 	The Guarantor’s address is 2800 Post Oak Boulevard, Suite 5000, Houston, Texas
77056-6118, and such address may be used by the Agent and the Lenders in any action against the
Guarantor.

[Remainder of Page Intentionally Left Blank; Signature Page Follows]

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     IN WITNESS WHEREOF, Guarantor has executed this Guaranty under seal on the 24th day of
April, 2006.

	 	 	 	 	 
	 	HINES REAL ESTATE INVESTMENT TRUST, INC., a

Maryland corporation

 	 
	 	By:  	/s/ Frank R. Apollo
 	 
	 	 	Name:  	Frank R. Apollo 	 
	 	 	Title:  	Chief Accounting Officer

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