Document:

Exhibit 10.6

 

EMPLOYMENT AGREEMENT

 

THIS
EMPLOYMENT AGREEMENT (the “Agreement”) is entered into as of April 21,
2008, but shall be effective, nunc pro tunc,
as of January 1, 2008, by and between INLAND REAL ESTATE CORPORATION, a
Maryland corporation (the “Company”), and Kristi A. Rankin (the “Executive”).

 

RECITALS:

 

A.            The Company is a real estate
investment trust which owns, operates and acquires neighborhood retail centers
and community centers within an approximate 400 mile radius of its headquarters
in Oak Brook, Illinois (the “Business”).

 

B.            Executive has served as the Company’s
Senior Vice President of its wholly owned subsidiary, Inland Commercial
Property Management, Inc., pursuant to an employment agreement, effective
as of January 1, 2004, by and between the Company and Executive and during
her employment thereunder, Executive has demonstrated certain unique and
particular talents and abilities with regard to the Business.

 

C.            The Company desires to continue to
assure itself of the availability of the talents and abilities of Executive, by
entering into a new employment agreement to become effective as of January 1,
2008.

 

D.            Executive desires to continue to be
employed by the Company, subject to the terms, conditions and covenants
hereinafter set forth.

 

E.             As a condition for the Company to
enter into this Agreement, Executive has agreed to restrict her ability to
enter into competition with the Company.

 

NOW,
THEREFORE, in consideration of the foregoing and the agreements, covenants and
conditions set forth herein, Executive and the Company hereby agree as follows:

 

ARTICLE I

EMPLOYMENT

 

1.1           Employment.

 

(a)           The Company hereby employs and
engages Executive, and Executive hereby accepts employment, upon the terms and
conditions set forth in this Agreement. 
Effective as of January 1, 2008 (the “Effective Date”), Executive
shall serve as Senior Vice President of Inland Commercial Property Management, Inc.,
the Company’s wholly owned subsidiary, with duties commensurate with such
position and such other duties and responsibilities as assigned from time to
time by the Company.

 

(b)           In addition, Executive shall provide
advice, consultation and services to any other entities which control, are
controlled by or are under common control with the Company now or in the future
(collectively, “Affiliates”), as may be requested by the Company.

 

 

1.2           Activities
and Duties During Employment. 
Executive represents and warrants to the Company that she is free to
engage in full-time employment with the Company, and that she has no prior or
other commitments or obligations of any kind to anyone else which would hinder
or interfere with her acceptance of her obligations under this Agreement, or
the exercise of her reasonable commercial efforts as an employee of the Company.  During the Employment Term (as defined
below), Executive agrees:

 

(a)           to faithfully serve and further the
interests of the Company in every lawful way, giving honest, diligent, loyal
and cooperative service to the Company and its Affiliates;

 

(b)           to comply with all reasonable rules and
policies which are consistent with the terms of this Agreement and which, from
time to time, may be adopted by the Company or its Affiliates; and

 

(c)           to devote all of her business time,
attention and efforts to the faithful and diligent performance of her services
to the Company and its Affiliates.

 

ARTICLE II

TERM

 

2.1           Term.  The term of employment under this Agreement
shall commence on the Effective Date and shall last through and including December 31,
2009 (the “Employment Term”) except as this Agreement may be terminated as
provided in Section 2.2.

 

2.2           Termination.  The Employment Term and employment of
Executive may be terminated as follows:

 

(a)           By the Company immediately for Cause
(as hereinafter defined).

 

(b)           By the Company immediately without
Cause.

 

(c)           Automatically, without the action of
either party, upon the death of Executive.

 

(d)           By either party upon a determination
of Total Disability (as hereinafter defined) of Executive.

 

(e)           Voluntarily by Executive.

 

(f)            By Executive, immediately for Good
Reason (as hereinafter defined).

 

(g)           On expiration of the Employment Term
if not extended by the mutual consent of the Company and Executive.

 

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2.3           Definitions
of “Cause,” “Total Disability,” Good Reason” and “Change of Control.”

 

(a)           For the purpose of this Agreement, “Cause”  shall mean:  (i) conduct amounting to fraud,
embezzlement, disloyalty or illegal misconduct in connection with Executive’s
duties under this Agreement and as an employee of the Company; (ii) conduct
that the Company reasonably believes has brought the Company into substantial
public disgrace or disrepute; (iii) failure to perform her duties
hereunder as reasonably directed by the Company after providing written notice
of the failure to Executive and Executive has failed to cure within ten (10) days
of receiving notice; (iv) gross negligence or willful misconduct by the
Executive with respect to the Company, its clients, its employees and its
activities; or (v) material breach by the Executive of this Agreement or
any other agreement to which Executive and the Company are a party or any
material breach by the Executive of any written policy adopted by the Company
concerning conflicts of interest, standards of business conduct or fair
employment practices and any other similar matter, provided that the Company
has provided written notice of the breach to Executive and Executive has failed
to cure the breach within ten (10) days of receiving notice.

 

(b)           For purposes of this Agreement,
Executive shall be determined to have a “Total Disability” upon the
determination of a physician, acceptable to the Company and Executive that
Executive is unable, by reason of accident or illness, to substantially perform
her duties or is expected to be in the condition for periods totaling six (6) months
(whether or not consecutive) during any period of twelve (12) months.  Nothing herein shall limit Executive’s right
to receive any payments to which Executive may be entitled under any disability
or employee benefit plan of the Company or under any disability or insurance
policy or plan.  During a period of Total
Disability prior to termination hereunder, Executive shall continue to receive
her full compensation (including base salary) and benefits.

 

(c)           “Good Reason” will mean any of the
following events which have not been cured within ten (10) days following
the Company’s receipt of Executive’s written notice specifying the events or
factors constituting Good Reason:

 

(i)            the
Company requires Executive to relocate her principal residence to a location
outside the Greater Chicago Metropolitan Area in order to perform her duties
and responsibilities hereunder;

 

(ii)           the
Executive’s base salary or other compensation and benefits is reduced to less
than the amount of the Base Salary and other compensation and benefits as set
forth in Section 3.1 below;

 

(iii)          a
material breach by the Company of the provisions of this Agreement; or

 

(iv)          following
a Change of Control, the assignment to Executive of duties which constitute a
material reduction in Executive’s title or authority and 

 

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which are materially
inconsistent with Executive’s position as contemplated by this Agreement.

 

(d)           “Change
of Control” shall mean any of the following events:

 

(i)            the members of IREC’s board of directors as of the date
of this Agreement fail to constitute a majority of the members of the board; provided,
however, that any individual becoming a member of the board who is
nominated or appointed to the board seat on the recommendation and approval of
IREC’s Nominating and Corporate Governance Committee shall be treated as if he
or she were a member of the board as of the date of this Agreement;

 

(ii)           the disposition by IREC of all, or substantially all, of
the assets of IREC; or

 

(iii)          the termination and liquidation of IREC.

 

ARTICLE III

COMPENSATION AND BENEFITS

 

3.1           Compensation.

 

(a)           Base Salary.  During the Employment Term, the Company shall
pay Executive a base salary (the “Base Salary”) of $210,000 per annum.

 

(b)           Annual Incentive Bonus.  The Company shall, in addition to Executive’s
Base Salary, pay Executive an Annual Incentive Bonus, which shall be payable
within 120 days of the end of each fiscal year in accordance with the formula
set forth on Exhibit A, attached hereto and made a part hereof.

 

(c)           Annual Long Term Share Award.  No later than June 30 of each fiscal
year during the Employment Term, the Company shall grant Executive an Annual
Long Term Share Award consisting of shares of the common stock of IREC (“Long
Term Shares”), subject to the conditions set forth below and in accordance with
the schedule set forth on Exhibit B, attached hereto and made a
part hereof.  Twenty percent (20%) of any
Long Term Shares granted hereunder shall vest on each successive yearly
anniversary of the grant of the Long Term Shares.

 

(i)            All
Long Term Shares shall be issued under, and in accordance with, IREC’s 2005
Equity Award Plan (the “2005 Equity Award Plan”); to the extent the terms of
any Long Term Shares granted pursuant to this Agreement conflict with the terms
of the 2005 Equity Award Plan, the terms of the 2005 Equity Award Plan shall
apply to the minimum extent necessary to eliminate the conflict.  Executive shall be the record owner of any
Long Term Shares granted hereunder; provided that any Long Term Shares
that have not yet vested shall be forfeited and redeemed by the Company,
without any further action on the part of the Company or the Executive, if
Executive is no longer employed by the Company for any reason, other than in
connection with a termination as described 

 

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in Sections 2.2(b), (c) or (d).  Executive may not sell, transfer, hypothecate,
pledge or assign any Long Term Shares which have not vested.

 

(ii)           Upon the occurrence of any forfeiture of Long Term Shares,
Executive shall immediately take all actions necessary to permit the Company to
redeem any forfeited Long Term Shares.

 

(iii)          Unless forfeited, Executive may exercise all rights of a
stockholder, including the right to vote and receive dividends with respect to
any Long Term Shares granted Executive.

 

(iv)          All Long Term Shares which may be issuable hereunder shall
be issued in reliance upon the following representations, warranties and
agreements of Executive, each of which shall be true and correct as of the date
of issuance and each of which shall survive the termination of this Agreement.

 

(A)          Executive acknowledges
that the common stock underlying any Long Term Shares has been registered under
the Securities Act of 1933, as amended (the “Securities Act”), pursuant to an
effective registration statement on Form S-8 (file no. 333-128624);

 

(B)           Executive acknowledges
that once the common stock underlying any Long Term Shares has been issued to
Executive, the common stock may not be subsequently transferred or sold by
Executive except in compliance with the registration requirements of federal
and state securities law or exemptions therefrom;

 

(C)           Executive acknowledges
that an investment in the IREC’s common stock is subject to significant risk,
including the risks described, from time to time, in IREC’s annual reports on Form 10-K.  Executive represents and warrants that she has
such knowledge and expertise in financial and business matters as to be capable
of evaluating the merits and risks of an investment in IREC’s common stock and
the ability to bear the economic risk of the investment; and

 

(D)          Executive represents and
warrants that she has had the opportunity to ask questions of the Company
concerning its business and to obtain any information which she considers
necessary to verify the accuracy of or to amplify upon the Company’s
disclosures and that all questions which have been asked have been answered by
the Company to Executive’s satisfaction.

 

(d)           Annual
Stock Option Award.  No later than June 30
of each fiscal year during the Employment Term, the Company shall grant
Executive an Annual Stock Option Award to purchase shares of the common stock
of IREC (“Annual Stock Options”), subject to the conditions set forth below and
in accordance with the schedule set forth on Exhibit C, attached
hereto and made a part hereof.  Twenty
percent (20%) of 

 

5

 

any Annual Stock Options
granted hereunder shall vest on each successive yearly anniversary of the grant
of the Annual Stock Options.

 

(i)            All Annual Stock Options shall be issued under, and in
accordance with, the 2005 Equity Award Plan; to the extent the terms of any
Annual Stock Options awarded pursuant to this Agreement conflict with the terms
of the 2005 Equity Award Plan, the terms of the 2005 Equity Award Plan shall
apply to the minimum extent necessary to eliminate the conflict.  Any Annual Stock Options that have not yet
vested shall be forfeited and redeemed by the Company, without any further
action on the part of the Company or the Executive, if Executive is no longer
employed by the Company for any reason, other than in connection with a
termination as described in Sections 2.2(b), (c) or (d).  Executive may not sell, transfer,
hypothecate, pledge or assign any Annual Stock Options which have not vested.

 

(ii)           Upon the occurrence of any forfeiture of Annual Stock
Options, Executive shall immediately take all actions necessary to permit the
Company to redeem any forfeited Annual Stock Options.

 

(iii)          All Annual Stock Options which may be issuable hereunder
shall be issued in reliance upon the following representations, warranties and
agreements of Executive, each of which shall be true and correct as of the date
of issuance and each of which shall survive the termination of this Agreement.

 

(A)          Executive acknowledges
that the common stock underlying any Annual Stock Options has been registered
under the Securities Act pursuant to an effective registration statement on Form S-8
(file no. 333-128624);

 

(B)           Executive acknowledges
that once the common stock underlying any Annual Stock Options has been issued
to Executive, the common stock may not be subsequently transferred or sold by
Executive except in compliance with the registration requirements of federal
and state securities law or exemptions therefrom;

 

(C)           Executive acknowledges
that an investment in IREC’s common stock is subject to significant risk,
including the risks described, from time to time, in IREC’s annual reports on Form 10-K.  Executive represents and warrants that she
has such knowledge and expertise in financial and business matters as to be
capable of evaluating the merits and risks of an investment in IREC’s common
stock and the ability to bear the economic risk of the investment; and

 

(D)          Executive represents and
warrants that she has had the opportunity to ask questions of the Company
concerning its business and to obtain any information which she considers
necessary to verify the accuracy of or to amplify upon the Company’s
disclosures and that all 

 

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questions which have been asked
have been answered by the Company to Executive’s satisfaction.

 

3.2           Payment.  All Base Salary due Executive hereunder shall
be paid in accordance with the general payroll payment practice of the  Company for executive level employees;
except that any payment relating to the termination of Executive shall be paid
as a lump sum payment within fifteen (15) days of termination.

 

3.3           Business Expenses.

 

(a)           Reimbursement.  The Company shall reimburse Executive for all
ordinary and necessary business expenses incurred by her in connection with the
performance of her duties hereunder.  The
reimbursement of business expenses will be governed by the policies for the
Company as they are in effect from time to time during the term of this
Agreement.

 

(b)           Accounting.  Executive shall provide the Company with an
accounting of any expenses, for which reimbursement is sought including a
description of the purpose for which each expense was incurred.  Executive shall provide the Company with such
other supporting documentation and other substantiation of reimbursable
expenses as may be required by Company to conform to Internal Revenue Service
or other requirements.  All such
reimbursements shall be payable by the Company to Executive within a reasonable
time after receipt by the Company of appropriate documentation required by the
Company.

 

3.4           Other Benefits.
The Company shall provide Executive with such retirement benefits and group
health and other insurance coverage at such levels and on such terms as the
Company generally provides to its executive level employees in accordance with
its Company-sponsored benefit plans as they are in effect from time to time
during the term of the Agreement.

 

3.5           Compensation Upon
Termination.  If Executive’s
employment hereunder and this Agreement is terminated in accordance with the
provisions of Article II, the Company will be obligated to provide
to Executive compensation and benefits, in lieu of any severance under any
severance plan that the Company may then have in effect, and subject to setoff
for any amounts owed by Executive to the Company or any affiliate of the
Company by reason of any contract, agreement, promissory note,  advance, failure to return Company
property or loan document, as follows:

 

(a)           Upon Termination for Death or
Total Disability.  If Executive’s
employment hereunder and this Agreement is terminated by reason of her death or
Total Disability, under Sections 2.2(c) or (d), then within thirty
(30) days of the date of termination the Company will pay Executive (or her
estate or beneficiaries):

 

(i)            any Base Salary that
has been accrued but not paid as of the date of termination (the “Accrued Base
Salary”);

 

(ii)           any compensation for
unused vacation days accrued as of the termination date in an amount equal to
Executive’s Base Salary multiplied by a 

 

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fraction, the numerator of which is the
number of accrued unused vacation days and the denominator of which is 360 (the
“Accrued Vacation Payment”);

 

(iii)          any expenses incurred by Executive prior to the date of
termination that may be reimbursed pursuant to this Agreement (the “Accrued
Reimbursable Expenses”);

 

(iv)          any accrued and vested benefits required to be provided
upon death or Total Disability by the terms of any Company-sponsored benefit plans
or programs exclusive of any Long Term Shares or Annual Stock Options (the “Accrued
Benefits”), together with any benefits required to be paid or provided in the
event of Executive’s death or Total Disability under applicable law; and

 

(v)           an amount equal to either the prorated portion of the
Annual Incentive Bonus that Executive received for the last fiscal year
completed prior to termination equal to the relevant Annual Incentive Bonus
multiplied by a fraction, the numerator of which is the number of days in the
year prior to the date of death or Total Disability and the denominator of
which is 360, or if the termination occurs in the first year of the Employment
Term, then the prorated portion of the Annual Incentive Bonus as if the target
bonus was received for that year (the “Accrued Bonus”) calculated in the same
fashion.

 

In addition,
if Executive’s employment and this Agreement is terminated under Sections
2.2(c) or (d), any Long Term Shares or Annual Stock Options issued to
Executive under this Agreement which have not yet vested shall immediately vest
and shall no longer be subject to forfeiture.

 

(b)           Upon
Termination by Company for Cause or Voluntarily by Executive.  If Executive’s employment hereunder and this
Agreement is terminated under Sections 2.2(a) or (e), within
fifteen (15) days of the date of such termination, the Company will pay
Executive:

 

(i)            any Accrued Base Salary;

 

(ii)           any Accrued Vacation Payment;

 

(iii)          any Accrued Reimbursable Expenses; and

 

(iv)          any Accrued Benefits, together with any benefits required
to be paid or provided under applicable law.

 

In addition,
if Executive’s employment and this Agreement is terminated under Sections
2.2(a) or (e), any Long Term Shares or Stock Option Awards issued to
Executive which have not yet vested shall immediately be forfeited by
Executive.

 

(c)           Upon
Termination by the Company Without Cause or by Executive for Good Reason.  If Executive’s employment hereunder and this
Agreement is terminated under Sections 2.2(b) or (f), the Company
will pay Executive:

 

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(i)            any  Accrued
Base Salary;

 

(ii)           any Accrued Vacation Payment;

 

(iii)          any Accrued Reimbursable Expenses;

 

(iv)          any Accrued Benefits, together with any benefits required
to be paid or provided under applicable law;

 

(v)           any Accrued Bonus; and

 

(vi)          an amount equal to 1.0 times the sum of: (A) Executive’s
then current per annum base salary; plus (B) an amount equal to the Annual
Incentive Bonus which was paid to Executive for the fiscal year immediately
preceding the year of termination; provided, however, that the
payment to Executive pursuant to this Section 3.5(c)(vi) shall
in no event exceed an amount which would cause Executive to receive an “excess
parachute payment” as defined in the Internal Revenue Code of 1986, as amended
(the “Code”); provided, however that if the termination occurs
within one year of a Change of Control, then in addition to the amounts
described in clauses (i) through (v) above, the Company will
pay Executive an amount equal to 2.0 times the sum of: (A) Executive’s
then current per annum base salary; plus (B) an amount equal to the Annual
Incentive Bonus which was paid to Executive for the fiscal year immediately
preceding the year of termination; plus (C) the aggregate dollar value of
each of the Annual Long Term Share Award and Annual Stock Option Award that was
granted to Executive for the fiscal year immediately preceding the year of
termination; provided, however, that the payment to Executive
pursuant to this Section 3.5(c)(vi) shall in no event exceed
an  amount which would cause
Executive to receive an “excess parachute payment” as defined in the Code.

 

In addition,
if Executive’s employment hereunder and this Agreement is terminated under Section 2.2(b),
any Long Term Shares or Annual Stock Options issued to Executive which have not
yet vested shall immediately vest and shall no longer be subject to forfeiture
by Executive.  If Executive’s employment
hereunder is terminated under Section 2.2(f), any Long Term Shares
or Annual Stock Options issued to Executive which have not vested shall
immediately be forfeited by Executive; provided that if this Agreement
is terminated under Section 2.2(f) within one year of a Change
of Control, then any Long Term Shares or Annual Stock Options issued to
Executive under this Agreement shall immediately vest and shall no longer be
subject to forfeiture by Executive.

 

3.6           Cessation
of Rights and Obligations: Survival of Certain Provisions.  On the date of expiration or earlier termination
of the Employment Term for any reason, all of the respective rights, duties,
obligations and covenants of the parties, as set forth herein, shall, except as
specifically provided herein to the contrary, cease and become of no further
force or effect as of the date of termination, and shall only survive as
expressly provided for herein.

 

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ARTICLE IV

CONFIDENTIALITY AND NON-COMPETE AGREEMENT

 

4.1                                 Non-Disclosure
of Confidential Information.  Executive hereby acknowledges and agrees that
the duties and services to be performed by Executive under this Agreement are
special and unique and that as a result of her employment by the Company
hereunder Executive has developed over time and will acquire, develop and use
information of a special and unique nature and value that is not generally
known to the public or to the Company’s industry, including but not limited to,
certain records, secrets, documentation, software programs, price lists,
ledgers and general information, employee records, mailing lists, shareholder
lists, tenant lists and profiles, prospective customer, acquisition candidate
or tenant lists, accounts receivable and payable ledgers, financial and other
records of the Company or its Affiliates, information regarding its
shareholders, tenants or joint venture partners, and other similar matters (all
such information being hereinafter referred to as “Confidential Information”).  Executive
further acknowledges and agrees that the Confidential Information is of great
value to the Company and that the restrictions and agreements contained in this
Agreement are reasonably necessary to protect the Confidential Information and
the goodwill of the Company and the Affiliates. 
Accordingly, Executive hereby agrees that:

 

(a)                                  Executive will
not, during the Employment Term or at any time thereafter, directly or
indirectly, except in connection with Executive’s performance of her duties
under this Agreement, or as otherwise authorized in writing by the Company for
the benefit of the Company or any Affiliate, divulge to any person, firm,
corporation, limited liability company, partnership or organization, or any
affiliated entity (hereinafter referred to as “Third Parties”),  or use or cause or authorize any Third
Parties to divulge or use, the Confidential Information, except as required by
law; and

 

(b)                                 Upon the
termination of the Employment Term and this Agreement for any reason
whatsoever, Executive shall deliver or cause to be delivered to the Company any
and all Confidential Information, including drawings, notebooks, keys, data and
other documents and materials belonging to the Company or its Affiliates which
is in her possession or under her control relating to the Company or its
Affiliates, regardless of the medium upon which it is stored, and will deliver
to the Company upon termination, any other property of the Company or its
Affiliates which is in her possession or under her control.

 

4.2                                 Non-Solicitation
and Covenant Not to Compete.

 

(a)                                  General.  Executive acknowledges that the covenants set
forth in this Section 4.2 are reasonable in scope and essential to
the preservation of the business and the goodwill of the Company, and are
consideration for the amounts to be paid to Executive hereunder.  Executive also acknowledges that the
enforcement of the covenants set forth in this Section 4.2 will not
preclude Executive from being gainfully employed in such manner and to the
extent as to provide a standard of living for himself, the members of her
family and the others dependent upon her of at least the level provided by this
Agreement.  In addition, Executive
acknowledges that the Company and 

 

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its Affiliates have obtained an advantage
over their competitors that is characterized by relationships with clients,
principals, tenants and other contacts.

 

(b)                                 Covenants.  Executive hereby covenants and agrees that,
except as permitted by the Company, during the Employment Term, and any
extensions thereof, and for a period of one (1) year following the
expiration, termination or extension of this Agreement, Executive shall not,
directly or indirectly:  (i) alone,
together or in association with others, either as a principal, agent, owner,
shareholder, officer, director, partner, employee, lender, investor or in any
other capacity, engage in, have any financial interest in or be in any way
connected or affiliated with, or render advice or services to, any business
engaged in purchasing, selling, financing, managing, leasing, brokering or
providing services for retail shopping centers or any new business or lines of
business which the Company may enter prior which business or businesses are
conducted in the greater metropolitan area of Chicago, Illinois, other than as
an employee of The Inland Group, Inc. (“TIGI”) or an affiliate of TIGI or
otherwise on behalf of the Company as an employee thereof or such other
business as may be permitted by the Company in writing; (ii) directly or
indirectly divert, take away, solicit or interfere with or attempt to divert,
take away, solicit or interfere with any present or prospective customer,
except on behalf of the Company as an employee thereof; (iii) directly or
indirectly solicit, induce, influence or attempt to solicit, induce or
influence any employee or agent of the Company to leave her employment or
engagement with the Company, or offer employment or engagement to or employ or
engage any such employee of the Company, or assist or attempt to assist any
such employee of the Company in seeking other employment; (iv) in any
manner slander, libel or by other means take action which is or intended, or
could reasonably be expected, to be detrimental to the Company or an Affiliate
or their respective employees or operations; (v) knowingly make or
participate in any “solicitation” of “proxies” or “consents” (as such terms are
used in the proxy rules of the United States Securities and Exchange
Commission) or make proposals for approval of the Company’s stockholders; (vi) knowingly
form, join or participate in a “group” (within the meaning of Section 13(d)(3) of
the Exchange Act) with respect to the Company’s securities; (vii) otherwise
knowingly act to control or seek to control the management, board of directors
or policies of the Company (except with respect to actions taken solely in
Executive’s capacity as an officer of the Company in the exercise of her
fiduciary duties; or (viii) make any agreement to do any of the foregoing
to the extent restricted thereby.  As
used in this Section 4.2, the term “Company” shall mean the Company
or any Affiliate thereof.  As used in
this Section 4.2(b), “customer” and “prospective customer” shall
include: (i) any tenant of the Company’s properties or any other person or
entity with whom the Company is negotiating for the leasing of real property
from the Company or an Affiliate at the time of the termination of this
Agreement or during the six month period immediately prior to such termination;
(ii) any owner or prospective owner of real property the purchase or sale
of which is being negotiated by the Company at the time of the termination of
this Agreement or during the six month period immediately prior to such
termination; or (iii) any joint venture partner of the Company.  The restrictions imposed by this subparagraph
4.2(b) shall not apply to the ownership of one percent (1%) or less of
all of the outstanding securities of any entity whose securities are listed on
a national securities exchange, or included for quotation on any interdealer
quotation system.

 

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4.3                                 Remedies.

 

(a)                                  Injunctive
Relief.  Executive expressly
acknowledges and agrees that the business of the Company is highly competitive
and that a violation of any of the provisions of Sections 4.1 or 4.2
would cause immediate and irreparable harm, loss and damage to the Company or
an Affiliate not adequately compensable by a monetary award.  Executive further acknowledges and agrees
that the time periods and territorial areas provided for herein are the minimum
necessary to adequately protect the business of the Company, the enjoyment of
the Confidential Information and the goodwill of the Company.  Without limiting any of the other remedies
available to the Company at law or in equity, or the Company’s right or ability
to collect money damages, Executive agrees that any actual or threatened
violation of any of the provisions of Sections 4.1 or 4.2 may be
immediately restrained or enjoined by any court of competent jurisdiction, and
that a temporary restraining order or emergency, preliminary or final
injunction may be issued in any court of competent jurisdiction, upon twenty-four
(24) hour notice and without bond.

 

(b)                                 Enforcement.  Executive expressly acknowledges and agrees
that the provisions of Sections 4.1 or 4.2 shall enforced to the fullest
extent permissible under the laws and public policies in each jurisdiction in
which enforcement might be sought. 
Accordingly, if any particular portion of Sections 4.1 or 4.2
shall ever be adjudicated as invalid or unenforceable, or if the application
thereof to any party or circumstance shall be adjudicated to be prohibited by
or invalidated by such laws or public policies, such section or sections shall
be: (i) deemed amended to delete therefrom such portions so adjudicated;
or (ii) modified as determined appropriate by such a court, such deletions
or modifications to apply only with respect to the operation of such section or
sections in the particular jurisdictions so adjudicating on the parties and
under the circumstances as to which so adjudicated.

 

ARTICLE V

MISCELLANEOUS

 

5.1                                 Notices.  All notices or other communications required
or permitted hereunder shall be in writing and shall be deemed given or
delivered: (i) when delivered personally or by commercial messenger; (ii) one
(1) business day following deposit with a recognized overnight courier
service; provided such deposit occurs prior to the deadline imposed by
such service for overnight delivery; (iii) when transmitted, if sent by
facsimile copy, provided confirmation of receipt is received by sender and such
notice is sent by an additional method provided hereunder, in each case above
provided such communication is addressed to the intended recipient thereof as
set forth below:

 

12

 

To Executive at her home
address.

 

	
  To the Company at:

  	
   

  	
  Inland
  Real Estate Corporation 

  2901 Butterfield Road 

  Oak Brook, Illinois 60523 

  Attn: Mark Zalatoris, President and Chief 

  Executive Officer

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  Shefsky &
  Froelich Ltd. 

  111 East Wacker Drive, Suite 2800 

  Chicago, Illinois 60601 

  Attn: Michael J. Choate 

  Telephone: (312) 836-4066 

  Facsimile: (312) 527-5921

  

 

Any party may change its
address for purposes of this paragraph by giving the other party written notice
of the new address in the manner set forth above.

 

5.2                                 Entire
Agreement; Amendments, Etc.  This Agreement contains the entire agreement
and understanding of the parties hereto, and supersedes all prior agreements
and understandings relating to the subject matter thereof.  No modification, amendment, waiver or
alteration of this Agreement or any provision or term hereof shall in any event
be effective unless the same shall be in writing, executed by both parties
hereto, and any waiver so given shall be effective only in the specific
instance and for the specific purpose for which given.

 

5.3                                 Benefit.  This Agreement shall be binding upon, and
inure to the benefit of, and shall be enforceable by, the heirs, successors and
legal representatives of Executive and the successors, assignees and
transferees of the Company and its current or future Affiliates.  This Agreement or any right or interest
hereunder may not be assigned by Executive.

 

5.4                                 No Waiver.  No failure or delay on the part of any party
hereto in exercising any right, power or remedy hereunder or pursuant hereto
shall operate as a waiver thereof; nor shall any single or partial exercise of
any such right, power or remedy preclude any other or further exercise thereof
or the exercise of any other right, power or remedy hereunder or pursuant
thereto.

 

5.5                                 Severability.  Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid
under applicable law but, if any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Agreement.  If any part of any
covenant or other provision in this Agreement is determined by a court of law
to be overly broad thereby making the covenant unenforceable, the parties
hereto agree, and it is their desire, that the court shall substitute a
judicially enforceable limitation in its place, and that as so modified the
covenant shall be binding upon the parties as if originally set forth herein.

 

13

 

5.6                                 Compliance and
Headings.  The
headings in this Agreement are intended to be for convenience and reference
only, and shall not define or limit the scope, extent or intent or otherwise
affect the meaning of any portion hereof.

 

5.7                                 Governing Law.  The parties agree that this Agreement shall
be governed by, interpreted and construed in accordance with the internal laws
of the State of Illinois without regard to its conflicts of law provisions, and
the parties agree that any suit, action or proceeding with respect to this
Agreement shall be brought in the state courts in Chicago, Illinois or in the
U.S. District Court for the Northern District of Illinois.  The parties hereto hereby accept the
exclusive jurisdiction of those courts for the purpose of any such suit, action
or proceeding.  Venue for any such
action, in addition to any other venue permitted by statute, will be in
Chicago, Illinois.

 

5.8                                 Counterparts.  This Agreement may be executed in one or more
counterparts, each of which will be deemed an original and all of which
together will constitute one and the same instrument.

 

5.9                                 No Presumption
Against Drafter.  Each of the
parties hereto has jointly participated in the negotiation and drafting of this
Agreement.  In the event an ambiguity or
a question of intent or interpretation arises, this Agreement shall be
construed as if drafted jointly by each of the parties hereto and no
presumptions or burdens of proof shall arise favoring any party by virtue of
the authorship of any provisions of this Agreement.

 

5.10                           Enforcement.  In the event either of the parties to this
Agreement shall bring an action against the other party with respect to the
enforcement or breach of any provision of this Agreement, the prevailing party
in such action shall recover from the non-prevailing party the costs incurred
by the prevailing party with respect to such action including court costs and
reasonable attorneys’ fees.

 

5.11                           Recitals.  The Recitals set forth above are hereby
incorporated in and made a part of this Agreement by this reference.

 

[The
remainder of this page intentionally blank]

 

14

 

IN WITNESS WHEREOF,  each of the parties hereto has caused this
Agreement to be executed and delivered as of the day and year first above
written.

 

	
   

  	
  INLAND REAL ESTATE CORPORATION,

  
	
   

  	
   

  
	
   

  	
  a Maryland corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark Zalatoris

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  Mark Zalatoris

  
	
   

  	
   

  
	
   

  	
  Its: 

  	
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kristi A. Rankin

  
	
   

  	
   

  
	
   

  	
  Name: 

  	
  Kristi A. Rankin

  
							

 

41963

 

 

EXHIBIT A

 

(FORMULA
FOR DETERMINING ANNUAL INCENTIVE BONUS)

 

I.                                         The Executive’s
Annual Incentive Bonus Opportunity (“AIBO”) shall be determined based on
performance of IREC, measured to either a Threshold, Target, or High level of
performance.

 

·                  IREC will have achieved a Threshold level of
performance if IREC’s annual growth in FFO per fully-diluted share for the
completed fiscal year immediately preceding the year in which the AIBO is
calculated, when compared to FFO per fully-diluted share for the next preceding
completed fiscal year, is not less than 80% of the median FFO growth rate for
the applicable year as published by NAREIT for the Retail REIT Shopping Center
subsector of the NAREIT Equity REIT Total Return Index (or, if not then in existence,
a comparable retail REIT shopping center index mutually agreeable to the
Company and Executive).

 

·                  IREC will have achieved a Target level of
performance if IREC’s annual growth in FFO per fully-diluted share for the
completed fiscal year immediately preceding the year in which the AIBO is
calculated, when compared to FFO per fully-diluted share for the next preceding
completed fiscal year, is not less than 100% of the median FFO growth rate for
the applicable year as published by NAREIT for the Retail REIT Shopping Center
subsector of the NAREIT Equity REIT Total Return Index (or, if not then in existence,
a comparable retail REIT shopping center index mutually agreeable to the
Company and Executive).

 

·                  IREC will have achieved a High level of
performance if IREC’s annual growth in FFO per fully-diluted share for the
completed fiscal year immediately preceding the year in which the AIBO is
calculated, when compared to FFO per fully-diluted share for the next preceding
completed fiscal year, is not less than 130% of the median FFO growth rate for
the applicable year as published by NAREIT for the Retail REIT Shopping Center
subsector of the NAREIT Equity REIT Total Return Index (or, if not then in
existence, a comparable retail REIT shopping center index mutually agreeable to
the Company and Executive).

 

For purposes of calculating
AIBO, “FFO” shall have the same meaning ascribed to that term in IREC’s annual
report on Form 10-K as filed with the SEC for the year in which the bonus
is to be calculated.

 

Subject to Section II.
below, if IREC achieves a Threshold level of performance, the Executive’s AIBO
will be equal to 15% of Executive’s Base Salary for the applicable year.  If IREC achieves a Target level of
performance, the Executive’s AIBO will be equal to 25% of Executive’s Base
Salary for the applicable year.  If IREC
achieves a High level of performance, the Executive’s AIBO will be equal to 35%
of Executive’s Base Salary for the applicable year.

 

II.                                     The Executive’s
Annual Incentive Bonus for the applicable year shall be determined by adding
three (3) components:

 

 

A.                                   The first
component shall be equal to 50% of the Executive’s AIBO.

 

B.                                     The second
component shall be determined by IREC’s chief executive officer, as recommended
to and approved by its board of directors’ compensation committee, based on a
subjective assessment of the Executive’s performance, and may be up to but not
in excess of 25% of the Executive’s AIBO.

 

C.                                     The third
component shall be dependent upon the Executive achieving a personal goal with
respect to her individual performance, as agreed by the Executive and IREC’s
chief executive officer at the beginning of the applicable year, and may be up
to but not in excess of 25% of the Executive’s AIBO.

 

III.                                 Notwithstanding
anything to the contrary in this Exhibit A, in the event that IREC
fails to achieve a Threshold level of performance in any given year, the
Executive’s Annual Incentive Bonus shall be equal to 10% of the Executive’s Base
Salary for the applicable year.  The
amount of any Annual Incentive Bonus determined pursuant to this Section III.
shall be non-discretionary on the part of the Company, and shall be paid to the
Executive in accordance with the provisions of Section 3.1(b) of
the Agreement.

 

 

EXHIBIT B

 

(FORMULA FOR DETERMINING ANNUAL AWARD OF LONG TERM SHARES)

 

I.                                         The Executive’s
Annual Award of Long Term Shares (“LTS”) shall be determined based on
performance of IREC, measured to either a Threshold, Target, or High level of
performance.

 

·                  IREC will have achieved a Threshold level of
performance if IREC’s annual growth in FFO per fully-diluted share for the
completed fiscal year immediately preceding the year in which the grant of Long
Term Shares is calculated, when compared to FFO per fully-diluted share for the
next preceding completed fiscal year, is not less than 80% of the median FFO
growth rate for the applicable year as published by NAREIT for the Retail REIT
Shopping Center subsector of the NAREIT Equity REIT Total Return Index (or, if
not then in existence, a comparable retail REIT shopping center index mutually
agreeable to the Company and Executive).

 

·                  IREC will have achieved a Target level of
performance if IREC’s annual growth in FFO per fully-diluted share for the
completed fiscal year immediately preceding the year in which the grant of Long
Term Shares is calculated, when compared to FFO per fully-diluted share for the
next preceding completed fiscal year, is not less than 100% of the median FFO
growth rate for the applicable year as published by NAREIT for the Retail REIT
Shopping Center subsector of the NAREIT Equity REIT Total Return Index (or, if
not then in existence, a comparable retail REIT shopping center index mutually
agreeable to the Company and Executive).

 

·                  IREC will have achieved a High level of
performance if IREC’s annual growth in FFO per fully-diluted share for the
completed fiscal year immediately preceding the year in which the grant of Long
Term Shares is calculated, when compared to FFO per fully-diluted share for the
next preceding completed fiscal year, is not less than 130% of the median FFO
growth rate for the applicable year as published by NAREIT for the Retail REIT
Shopping Center subsector of the NAREIT Equity REIT Total Return Index (or, if
not then in existence, a comparable retail REIT shopping center index mutually
agreeable to the Company and Executive).

 

For purposes of calculating
the LTS grant, “FFO” shall have the same meaning ascribed to that term in IREC’s
annual report on Form 10-K as filed with the SEC for the year in which the
bonus is to be calculated.

 

Subject to Section II.
below, if IREC achieves a Threshold level of performance, the Executive’s LTS
grant will be the number of shares equal to the quotient of (1) 10% of the
Executive’s Base Salary for the applicable year, divided by (2) the
average of the high and low trading price as reported by the New York Stock
Exchange on the date of grant.  If IREC
achieves a Target level of performance, the Executive’s LTS grant will be the
number of shares equal to the quotient of 

 

 

(1) 20% of the
Executive’s Base Salary for the applicable year, divided by (2) the
average of the high and low trading price as reported by the New York Stock
Exchange on the date of grant.  If IREC
achieves a High level of performance, the Executive’s LTS grant will be the
number of shares equal to the quotient of (1) 30% of the Executive’s Base
Salary for the applicable year, divided by (2) the average of the high and
low trading price as reported by the New York Stock Exchange on the date of
grant.

 

II.                                     The Executive’s
Annual Award of Long Term Shares for the applicable year shall be determined by
adding three components:

 

A.                                   The first
component shall be equal to 50% of the Executive’s LTS grant hereunder.

 

B.                                     The second
component shall be determined by IREC’s chief executive officer, as recommended
to and approved by its board of director’s compensation committee, based on a
subjective assessment of the Executive’s performance, and may be up to but not
in excess of 25% of the Executive’s LTS grant.

 

C.                                     The third
component shall be dependent upon the Executive achieving a personal goal with
respect to her individual performance, as agreed by the Executive and IREC’s
chief executive officer, and may be up to but not in excess of 25% of the
Executive’s LTS grant.

 

III.                                 Notwithstanding
anything to the contrary in this Exhibit B, in the event that IREC
fails to achieve a Threshold level of performance in a given year, the
Executive’s Annual Award of Long Term Shares shall be equal to the quotient of (1) 5%
of the Executive’s Base Salary for the applicable year, divided by (2) the
average of the high and low trading price as reported by the New York Stock
Exchange on the date of grant.  Any
Annual Award of Long Term Shares determined pursuant to this Section III.
shall be non-discretionary on the part of the Company, and shall be awarded to
the Executive in accordance with the provisions of Section 3.1(c) of
the Agreement.

 

 

EXHIBIT C

 

(FORMULA FOR DETERMINING
ANNUAL STOCK OPTION AWARD)

 

I.                                         The Executive
will be awarded an Annual Stock Option Award only if IREC shall have achieved a
Threshold level of performance in the completed fiscal year immediately
preceding the award.  For these purposes,
IREC will have achieved a Threshold level of performance if IREC’s annual
growth in FFO per fully-diluted share for the completed fiscal year immediately
preceding the year in which the award of Annual Stock Options is calculated,
when compared to FFO per fully-diluted share for the next preceding completed
fiscal year, is not less than 80% of the median FFO growth rate for the
applicable year as published by NAREIT for the Retail REIT Shopping Center
subsector of the NAREIT Equity REIT Total Return Index (or, if not then in
existence, a comparable retail REIT shopping center index mutually agreeable to
the Company and Executive).

 

II.                                     If IREC achieves a Threshold
level of performance, the Executive’s Annual Stock Option Award will authorize
the Executive to purchase the number of shares equal to the quotient of (1) 5%
of the Executive’s Base Salary for the applicable year, divided by (2) the
closing price per share on the day immediately preceding the date of grant (or,
if not a trading day, on the next preceding trading day during which a sale
occurred), in each case as reported by the New York Stock Exchange.  The strike price for each share underlying
each Annual Stock Option Award will be equal to the closing price per share on
the day immediately preceding the date of grant (or, if not a trading day, on
the next preceding trading day during which a sale occurred), in each case as
reported by the New York Stock Exchange.Exhibit 10.7

 

THIRD
AMENDED AND RESTATED

CREDIT
AGREEMENT

 

 

DATED AS
OF APRIL 21, 2008

 

AMONG

 

INLAND
REAL ESTATE CORPORATION,

AS
BORROWER

 

AND

 

KEYBANK NATIONAL ASSOCIATION

AS ADMINISTRATIVE AGENT

 

KEYBANC CAPITAL MARKETS

AS CO-LEAD ARRANGER

 

AND

 

WACHOVIA BANK, NATIONAL ASSOCIATION 

AS SYNDICATION AGENT

 

AND

 

WACHOVIA CAPITAL MARKETS, LLC

AS CO-LEAD ARRANGER

 

AND

 

THE SEVERAL LENDERS

FROM TIME TO TIME PARTIES HERETO,

AS LENDERS

 

 

THIRD
AMENDED AND RESTATED CREDIT AGREEMENT

 

This Third Amended and Restated Credit Agreement,
dated as of April 21, 2008, is among Inland Real Estate Corporation, a
corporation organized under the laws of the State of Maryland (the “Borrower”),
KeyBank National Association, a national banking association, both individually
as a “Lender” and as “Administrative Agent”, Wachovia Bank,
National Association, both individually as a “Lender” and as a “Syndication
Agent,” KeyBanc Capital Markets as a “Co-Lead Arranger,” and
Wachovia Capital Markets, LLC as a “Co-Lead Arranger” (the Co-Lead
Arrangers will collectively be referred to as 
“Lead Arrangers”), and the several banks, financial institutions
and other entities which may from time to time become parties to this Agreement
as additional “Lenders”.

 

RECITALS

 

A.                             The
Borrower is primarily engaged in the business of purchasing, owning, operating,
leasing and managing retail properties.

 

B.                               The
Borrower is qualified as a real estate investment trust under Section 856
of the Code.

 

C.                               The
Borrower and certain of the Lenders are parties to a Second Amended and
Restated Credit Agreement dated as of April 22, 2005 (as amended, the “Existing
Agreement”).

 

D.                              The
Borrower has requested that such Lenders agree to amend and restate the
Existing Agreement to modify the terms thereof, including without limitation to
admit additional Lenders,  provide for
future increases in the maximum aggregate amount of loans available thereunder,
and provide for an extension of the Facility Termination Date.  The Lenders have agreed to do so.

 

NOW, THEREFORE, in consideration of the mutual
covenants and agreements herein contained, the parties hereto agree as follows:

 

ARTICLE I

DEFINITIONS

 

As used in this Agreement:

 

“ABR Applicable Margin” means, as of any date with
respect to any Floating Rate Advance, the applicable per annum amount then in
effect pursuant to Section 2.3 hereof.

 

“Acquisition” means any transaction, or any series of
related transactions, consummated on or after the date of this Agreement, by
which the Borrower or any of its Subsidiaries (i) acquires any going
business or all or substantially all of the assets of any firm, corporation or
division thereof, whether through purchase of assets, merger or otherwise or (ii) directly
or indirectly acquires (in one transaction or as the most recent transaction in
a series of transactions) at least a majority (in number of votes) of the
securities of a corporation which have ordinary voting power for the election
of directors (other than securities having such power only by reason of the
happening of a contingency) or a majority (by percentage or voting power) of
the outstanding partnership interests of a partnership.

 

“Adjusted Annual EBITDA” means, as of any date, an
annualized amount determined by multiplying four (4) times the
Consolidated Net Income for the most recent fiscal quarter of Borrower 

 

 

for which financial
results have been reported, as adjusted by (i) adding or deducting for, as
appropriate, any adjustment made under GAAP for straight lining of rents, gains
or losses from sales of assets, extraordinary items, depreciation,
amortization, interest expenses, the Consolidated Group Pro Rata Share of
interest, depreciation and amortization in Investment Affiliates; and (ii) deducting
from such annualized amount an annual amount for capital expenditures equal to
$0.15 per square foot times the weighted daily average gross leaseable area of
Projects owned by the Consolidated Group or any Investment Affiliate (but only
deducting the applicable Consolidated Group Pro Rata Share of such amount with
respect to such Investment Affiliate) during such fiscal quarter.

 

“Adjusted Annual NOI” means, as of any date, with
respect to any group of Projects, an annualized amount determined by
multiplying four (4) times the aggregate Net Operating Income attributable
to such Projects for the most recent fiscal quarter of Borrower for which
financial results have been reported, as adjusted by an annual amount for
capital expenditures equal to $0.15 per square foot times the gross leaseable
area of such Projects; adding or deducting for, as appropriate, any adjustment
made to under GAAP for straight lining of rents, gains, or losses from sales of
assets, extraordinary items, depreciation, amortization, or interest expense;
and (i) deducting therefrom any income attributable to Excluded Tenants
but only if and to the extent that the aggregate amount of such income
attributable to Excluded Tenants would be greater than 5% of all other elements
of aggregate Adjusted Annual NOI without regard to such income and (ii) adding
or deducting for, as appropriate, any adjustment made to under GAAP for
straight lining of rents, gains, or losses from sales of assets, extraordinary
items, depreciation, amortization or interest expense.

 

“Adjusted Unencumbered NOI”
means, as of any date, Unencumbered NOI for the most recent fiscal quarter of
the Borrower for which financial results have been reported less an
amount for capital expenditures equal to $0.0375 per gross leasable square foot
($0.15 per annum divided by four quarters) times the weighted average gross
leasable area of Qualifying Unencumbered Properties owned by the Borrower and
the Subsidiary Guarantors during such fiscal quarter.

 

“Administrative Agent” means KeyBank National
Association in its capacity as agent for the Lenders pursuant to Article X,
and not in its individual capacity as a Lender, and any successor
Administrative Agent appointed pursuant to Article X.

 

“Advance” means a borrowing hereunder consisting of
the aggregate amount of the several Loans made by one or more of the Lenders to
the Borrower of the same Type and, in the case of Fixed Rate Advances, for the
same Interest Period, including without limitation Swingline Advances.

 

“Affiliate” of any Person means any other Person
directly or indirectly controlling, controlled by or under common control with
such Person.  A Person shall be deemed to
control another Person if the controlling Person owns 10% or more of any class
of voting securities (or other ownership interests) of the controlled Person or
possesses, directly or indirectly, the power to direct or cause the direction
of the management or policies of the controlled Person, whether through
ownership of stock, by contract or otherwise.

 

“Aggregate Commitment” means, as of any date, the
aggregate of the then-current Commitments of all the Lenders, which is
currently $155,000,000, as such amount may be increased pursuant to Section 2.2
hereof.

 

“Aggregate Pool Value” means, as of any date, the sum
of (i) 0.625 times then current Unencumbered Asset Value plus (ii) the
result obtained by multiplying 0.60 times the aggregate Trapped Equity Property
Value of all then current Trapped Equity Properties, and then subtracting from
such amount the then current aggregate outstanding amount of Secured
Indebtedness secured by such 

 

2

 

Trapped Equity
Properties, but in no event may the amount added to Aggregate Pool Value under
this clause (ii) be less than zero on account of Trapped Equity
Properties.

 

“Agreement” means this Credit Agreement, as it may be
amended or modified and in effect from time to time.

 

“Agreement Execution Date” means the date this
Agreement has been fully executed and delivered by all parties hereto.

 

 “Alternate Base
Rate” means, for any day, a rate of interest per annum equal to the higher of (i) the
Prime Rate for such day and (ii) the sum of Federal Funds Effective Rate
for such day plus 1/2% per annum.

 

“Anti-Terrorism Laws” is defined in Section 5.28.

 

“Applicable Margin” means, as applicable, the ABR
Applicable Margin or the LIBOR Applicable Margin which are used in calculating
the interest rate applicable to the various Types of Advances.

 

“Article” means an article of this Agreement unless
another document is specifically referenced.

 

“Authorized Officer” means any of the President and
Chief Executive Officer, Executive Vice President and Chief Operating Officer,
Vice President and Chief Financial Officer or Vice President and General
Counsel of the Borrower, acting singly.

 

“Bankruptcy Code” means the Bankruptcy Code of the
United States of America, as amended from time to time.

 

“Borrower” means Inland Real Estate Corporation, a
corporation organized under the laws of the State of Maryland, and its
successors and assigns.

 

“Borrowing Date” means a date on which an Advance is
made hereunder.

 

“Borrowing Notice” is defined in Section 2.9.

 

“Business Day” means (i) with respect to any
borrowing, payment or rate selection of LIBOR Advances, a day (other than a
Saturday or Sunday) on which banks generally are open in Cleveland, Ohio and
New York, New York for the conduct of substantially all of their commercial
lending activities and on which dealings in United States dollars are carried
on in the London interbank market and (ii) for all other purposes, a day
(other than a Saturday or Sunday) on which banks generally are open in
Cleveland, Ohio and New York, New York for the conduct of substantially all of
their commercial lending activities.

 

“Capital Stock” means any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a corporation,
any and all equivalent ownership interests in a Person which is not a
corporation and any and all warrants or options to purchase any of the
foregoing.

 

“Capitalization Rate” means .0775.

 

“Capitalized Lease” of a Person means any lease of
Property imposing obligations on such Person, as lessee thereunder, which are
required in accordance with GAAP to be capitalized on a balance sheet of such
Person.

 

3

 

“Capitalized Lease Obligations” of a Person means the
amount of the obligations of such Person under Capitalized Leases which would
be shown as a liability on a balance sheet of such Person prepared in
accordance with GAAP.

 

“Cash Equivalents” 
means, as of any date:

 

(i)                                     securities issued or directly and fully
guaranteed or insured by the United States Government or any agency or
instrumentality thereof having maturities of not more than one year from such
date;

 

(ii)                                  mutual funds organized under the United
States Investment Company Act rated AAm or AAm-G by S&P and P-1 by Moody’s;

 

(iii)                               certificates of deposit or other interest-bearing
obligations of a bank or trust company which is a member in good standing of
the Federal Reserve System having a short term unsecured debt rating of not
less than A-1 by S&P and not less than P-1 by Moody’s (or in each case, if
no bank or trust company is so rated, the highest comparable rating then given
to any bank or trust company, but in such case only for funds invested
overnight or over a weekend) provided that such investments shall mature or be
redeemable upon the option of the holders thereof on or prior to a date one
month from the date of their purchase;

 

(iv)                              certificates of deposit or other
interest-bearing obligations of a bank or trust company which is a member in
good standing of the Federal Reserve System having a short term unsecured debt
rating of not less than A-1+ by S&P, and not less than P-1 by Moody’s and
which has a long term unsecured debt rating of not less than A1 by Moody’s (or
in each case, if no bank or trust company is so rated, the highest comparable
rating then given to any bank or trust company, but in such case only for funds
invested overnight or over a weekend) provided that such investments shall
mature or be redeemable upon the option of the holders thereof on or prior to a
date three months from the date of their purchase;

 

(v)                                 bonds or other obligations having a short
term unsecured debt rating of not less than A-1+ by S&P and P-1+ by Moody’s
and having a long term debt rating of not less than A1 by Moody’s issued by or
by authority of any state of the United States, any territory or possession of
the United States, including the Commonwealth of Puerto Rico and agencies
thereof, or any political subdivision of any of the foregoing;

 

(vi)                              repurchase agreements issued by an entity
rated not less than A-1+ by S&P, and not less than P-1 by Moody’s which are
secured by U.S. Government securities of the type described in clause (i) of
this definition maturing on or prior to a date one month from the date the
repurchase agreement is entered into;

 

(vii)                           short term promissory notes rated not less than A-1+
by S&P, and  not less than P-1 by
Moody’s maturing or to be redeemable upon the option of the holders thereof on
or prior to a date one month from the date of their purchase; and

 

(viii)                        commercial paper (having original maturities of not
more than 365 days) rated at least A-1+ by S&P and P-1 by Moody’s and
issued by a foreign or domestic issuer who, at the time of the investment, has
outstanding long-term unsecured debt obligations rated at least A1 by Moody’s.

 

4

 

“Change of Control” means (i) any change in the
ownership of the Borrower which results in less than eighty percent (80%) of
the Borrower’s Capital Stock being held by Persons who were either shareholders
on the Agreement Execution Date, spouses, relatives or estates of such
shareholders or trustees holding for the benefit of such shareholders or their
spouses, relatives or estates, or (ii) any change in the membership of the
Borrower’s Board of Directors which results in the board members as of any date
after the Agreement Execution Date constituting less than 50% of the total
board members at any time during the two (2) year period following such
date.

 

“Change in Management” means the failure of at least
two (2) of Brett A. Brown, D. Scott Carr or Mark E. Zalatoris to continue
to be active on a daily basis in the management of the Borrower provided that
if any such individuals shall die or become disabled the Borrower shall have
sixty (60) days to retain a replacement executive of comparable experience
which is reasonably satisfactory to the Administrative Agent.

 

“Code” means the Internal Revenue Code of 1986, as
amended, reformed or otherwise modified from time to time.

 

“Commitment” means, for each Lender, the obligation of
such Lender to make Loans and issue 
Facility Letters of Credit not exceeding the amount set forth opposite
its signature below or as set forth in any Notice of Assignment relating to any
assignment that has become effective pursuant to Section 12.3.2, as
such amount may be modified from time to time pursuant to the terms hereof.

 

“Consolidated Debt Service” means, for any period,
without duplication, (a) Consolidated Interest Expense for such period plus
(b) the aggregate amount of scheduled principal payments attributable to
Consolidated Outstanding Indebtedness (excluding optional prepayments and
scheduled principal payments in respect of any such Indebtedness which is not
amortized through equal periodic installments of principal and interest over
the term of such Indebtedness) required to be made during such period by any
member of the Consolidated Group plus (c) a percentage of all such
scheduled principal payments required to be made during such period by any
Investment Affiliate on Indebtedness taken into account in calculating
Consolidated Interest Expense, equal to the greater of (x) the percentage
of the principal amount of such Indebtedness for which any member of the
Consolidated Group is liable and (y) the Consolidated Group Pro Rata Share
of such Investment Affiliate.

 

“Consolidated Group” means the Borrower and all
Subsidiaries which are consolidated with it for financial reporting purposes
under GAAP.

 

“Consolidated Group Pro Rata Share” means, with
respect to any Investment Affiliate, the percentage of the total equity
ownership interests held by the Consolidated Group in the aggregate, in such
Investment Affiliate determined by calculating the greater of (i) the
percentage of the issued and outstanding stock, partnership interests or
membership interests in such Investment Affiliate held by the Consolidated
Group in the aggregate and (ii) the percentage of the total book value of
such Investment Affiliate that would be received by the Consolidated Group in
the aggregate, upon liquidation of such Investment Affiliate, after repayment
in full of all Indebtedness of such Investment Affiliate.

 

“Consolidated Interest Expense” means, for any period
without duplication, the sum of (a) the amount of interest expense,
determined in accordance with GAAP, of the Consolidated Group for such period
attributable to Consolidated Outstanding Indebtedness during such period plus (b) the
Consolidated Group Pro Rata Share of any interest expense, determined in
accordance with GAAP, of any Investment Affiliate, for such period, whether
recourse or non-recourse.

 

5

 

“Consolidated Net Income” means, for any period, the
sum of (i) consolidated net income (or loss) of the Consolidated Group for
such period determined on a consolidated basis in accordance with GAAP plus (ii) without
duplication, the applicable Consolidated Group Pro Rata Share of the net income
(or loss) of each Investment Affiliate for such period determined in accordance
with GAAP.

 

“Consolidated Net Worth” means, as of any date of
determination, an amount equal to (a) Total Asset Value minus (b) Consolidated
Outstanding Indebtedness as of such date.

 

“Consolidated Outstanding Indebtedness” means, as of
any date of determination, without duplication, the sum of (a) all
Indebtedness of the Consolidated Group outstanding at such date, determined on
a consolidated basis in accordance with GAAP, plus (b) the applicable
Consolidated Group Pro Rata Share of any Indebtedness of each Investment
Affiliate other than Indebtedness of such Investment Affiliate to a member of
the Consolidated Group, less (c) with respect to each consolidated
Subsidiary of the Borrower in which the Borrower does not directly or
indirectly hold a 100% ownership interest, a percentage of any Indebtedness of
such consolidated Subsidiary which is not a Guarantee Obligation of the
Borrower equal to the percentage ownership interest in such consolidated
Subsidiary which is not held directly or indirectly by the Borrower.

 

“Construction in Progress” means, as of any date, the
total construction cost expended as of the applicable date to construct any
Projects then under development plus the book value of all land not then
included in Unimproved Land.

 

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

 

“Conversion/Continuation Notice” is defined in Section 2.10.

 

“Default” means an event described in Article VII.

 

“Defaulting Lender” means any Lender which fails or
refuses to perform its obligations under this Agreement within the time period
specified for performance of such obligation, or, if no time frame is
specified, if such failure or refusal continues for a period of five Business
Days after written notice from the Administrative Agent; provided that if such
Lender cures such failure or refusal, such Lender shall cease to be a
Defaulting Lender.

 

“Default Rate” means the interest rate which may apply
during the continuance of a Default pursuant to Section 2.12.

 

“Development Project” means a Project currently under
development that has not achieved an Occupancy Rate of at least 80%, or on
which the improvements (other than tenant improvements) related to the
development have not been completed. A Development Project on which all
improvements (other than tenant improvements) related to the development of
such Project have been completed for at least 12 months shall cease to
constitute a Development Project notwithstanding the fact that such Project has
not achieved an Occupancy Rate of at least 80%.

 

“Eligible Assignee” means (a) another
Lender, (b) with respect to any Lender, any Affiliate of that Lender, (c) any
commercial bank having a combined capital and surplus of $5,000,000,000 or
more, (d) the central bank of any country which is a member of the
Organization for Economic Cooperation and Development, (e) any savings
bank, savings and loan association or similar financial institution which (A) has
a net worth of $500,000,000 or more, (B) is engaged in the business of
lending money and extending credit under credit facilities substantially
similar to those extended under this Agreement 

 

6

 

and (C) is operationally
and procedurally able to meet the obligations of a Lender hereunder to the same
degree as a commercial bank, and (f) any other financial institution
(including a mutual fund or other fund) approved by the Administrative Agent
and, unless a Default shall have occurred and be continuing, Borrower (such
approval not to be unreasonably withheld or delayed) having total assets of
$500,000,000 or more which meets the requirements set forth in subclauses (B) and
(C) of clause (e) above; provided that each
Eligible Assignee must either (a) be organized under the Laws of the
United States of America, any State thereof or the District of Columbia or (b) be
organized under the Laws of the Cayman Islands or any country which is a member
of the Organization for Economic Cooperation and Development, or a political
subdivision of such a country, and (i) act hereunder through a branch,
agency or funding office located in the United States of America and (ii) be
exempt from withholding of tax on interest.

 

“Environmental Laws” means any and all foreign,
Federal, state, local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, requirements of any Governmental Authority or other
Requirements of Law (including common law) regulating, relating to or imposing
liability or standards of conduct concerning protection of human health or the
environment, as now or may at any time hereafter be in effect, in each case to
the extent the foregoing are applicable to the Borrower or any Subsidiary or
any of their respective assets or Projects.

 

“ERISA” means the Employee Retirement Income Security
Act of 1974, as amended from time to time, and any rule or regulation
issued thereunder.

 

“Excluded Taxes” means, in the case of each Lender or
applicable Lending Installation and the Administrative Agent, taxes imposed on
its overall net income, and franchise taxes imposed on it, by any jurisdiction
with taxing authority over the Lender.

 

“Excluded Tenants” means, as of any date, any tenant
at one of the Projects that either (i) is subject to a voluntary or
involuntary petition for relief under any federal or state bankruptcy codes or
insolvency law or (ii) is not operating its business in its demised
premises at such Project, unless such tenant’s lease obligations are guaranteed
by an entity whose then current long-term, unsecured debt obligations are rated
BBB— or above by S&P and Baa3 or above by Moody’s.

 

“Executive Order” is defined in Section 5.28.

 

“Existing Agreement” is defined in the Recitals hereto.

 

“Facility Letter of Credit” means a Letter of Credit
issued pursuant to Article IIA of this Agreement.

 

“Facility Letter of Credit Fee” is defined in Section 2A.8.

 

“Facility Letter of Credit Obligations” means, as at
the time of determination thereof, all liabilities, whether actual or
contingent, of the Borrower with respect to Facility Letters of Credit,
including the sum of (a) the Reimbursement Obligations and (b) the
aggregate undrawn face amount of the then outstanding Facility Letters of
Credit.

 

“Facility Letter of Credit Sublimit” means
$25,000,000.

 

“Facility Obligations” means all Obligations other
than the Related Swap Obligations.

 

“Facility Termination Date” means April 20, 2011,
being the Business Day immediately preceding the third (3rd)
anniversary of the Agreement Execution Date.

 

7

 

“Federal Funds Effective Rate” shall mean, for any
day, the rate per annum (rounded upward to the nearest one one-hundredth of one
percent (1/100 of 1%)) announced by the Federal Reserve Lender of Cleveland on
such day as being the weighted average of the rates on overnight federal funds
transactions arranged by federal funds brokers on the previous trading day, as
computed and announced by such Federal Reserve Lender in substantially the same
manner as such Federal Reserve Lender computes and announces the weighted
average it refers to as the “Federal Funds Effective Rate.”

 

“Fee Letter” is defined in Section 2.6.

 

“Financeable Ground Lease”
means, a ground lease reasonably satisfactory to the Administrative Agent,
which must provide customary protections for a potential leasehold mortgagee (“Mortgagee”)
which include, among other things (i) a remaining term, including any
optional extension terms exercisable unilaterally by the tenant, of no less
than 25 years, (ii) a provision that the ground lease will not be
terminated until the Mortgagee has received notice of a default, has had a
reasonable opportunity to cure or complete foreclosure, and has failed to do so,
(iii) provision for a new lease to the Mortgagee as tenant on the same
terms if the ground lease is terminated for any reason, (iv) transferability
of the tenant’s interest under the ground lease without any requirement for
consent of the ground lessor unless based on delivery of customary assignment
and assumption agreements from the transferor and transferee, (v) the
ability of the tenant to mortgage tenant’s interest under the ground lease
without any requirement  for consent of
the ground lessor, and (vi) that the tenant under the ground lease is
entitled to all insurance proceeds and condemnation awards (other than the
amount attributable to landlord’s fee interest in the land if an adjustment in
rent is provided for in connection therewith).

 

“First Mortgage Receivable” means any Indebtedness
owing to a member of the Consolidated Group which is secured by a
first-priority mortgage or deed of trust on commercial real estate having a
value in excess of the amount of such Indebtedness and which has been
designated by the Borrower as a “First Mortgage Receivable” in its most recent
compliance certificate.

 

“Fixed Charges” shall mean, as of any date,  the sum of (i) Consolidated Debt Service
for the most recent fiscal quarter of Borrower for which financial results have
been reported times four (4) plus (ii) all dividends payable on
account of preferred stock or preferred operating partnership units of the
Borrower or any other Person in the Consolidated Group (including dividends to
Inland Ryan joint ventures) with respect to the four (4) immediately
preceding fiscal quarters of Borrower for which financial results have been
reported.

 

“Fixed Rate” means the LIBOR Rate.

 

“Fixed Rate Advance” means an Advance which bears
interest at a Fixed Rate.

 

“Fixed Rate Loan” means a Loan which bears interest at
a Fixed Rate.

 

“Floating Rate” means, for any day, a rate per annum
equal to (i) the Alternate Base Rate for such day plus (ii) ABR
Applicable Margin for such day, in each case changing when and as the Alternate
Base Rate changes.

 

“Floating Rate Advance” means an Advance which bears
interest at the Floating Rate.

 

“Floating Rate Loan” means a Loan which bears interest
at the Floating Rate.

 

“Funded Percentage” means, with respect to any Lender
at any time, a percentage equal to a fraction the numerator of which is the
amount actually disbursed and outstanding to Borrower by such 

 

8

 

Lender at such time and
the denominator of which is the total amount disbursed and outstanding to
Borrower by all of the Lenders at such time.

 

“Funds From Operations” shall have the meaning
determined from time to time by the National Association of Real Estate
Investment Trusts to be the meaning most commonly used by its members.

 

“GAAP” means generally accepted accounting principles
in the United States of America as in effect from time to time, applied in a
manner consistent with that used in preparing the financial statements referred
to in Section 6.1.

 

“Governmental Authority” means any nation or
government, any state or other political subdivision thereof and any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.

 

“Guarantee Obligation” means, as to any Person (the “guaranteeing
person”), any obligation (determined without duplication) of (a) the
guaranteeing person or (b) another Person (including, without limitation,
any bank under any Letter of Credit) to induce the creation of which the
guaranteeing person has issued a reimbursement, counter-indemnity or similar
obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the “primary
obligations”) of any other third Person (the “primary obligor”) in
any manner, whether directly or indirectly, including, without limitation, any
obligation of the guaranteeing person, whether or not contingent, (i) to
purchase any such primary obligation or any property constituting direct or
indirect security therefor, (ii) to advance or supply funds (1) for
the purchase or payment of any such primary obligation or (2) to maintain
working capital or equity capital of the primary obligor or otherwise to
maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (iv) otherwise to assure or
hold harmless the owner of any such primary obligation against loss in respect
thereof; provided, however, that the term Guarantee Obligation
shall not include endorsements of instruments for deposit or collection in the
ordinary course of business.  The amount
of any Guarantee Obligation of any guaranteeing person shall be deemed to be
the maximum stated amount of the primary obligation relating to such Guarantee
Obligation (or, if less, the maximum stated liability set forth in the
instrument embodying such Guarantee Obligation), provided, that in the
absence of any such stated amount or stated liability, the amount of such
Guarantee Obligation shall be such guaranteeing person’s maximum reasonably
anticipated liability in respect thereof as determined by the Borrower in good
faith.

 

“Indebtedness” of any Person
at any date means without duplication, (a) all indebtedness of such Person
for borrowed money including without limitation any repurchase obligation or
liability of such Person with respect to securities, accounts or notes
receivable sold by such Person, (b) all obligations of such Person for the
deferred purchase price of property or services (other than current trade
liabilities incurred in the ordinary course of business and payable in
accordance with customary practices), to the extent such obligations constitute
indebtedness for the purposes of GAAP, (c) any other indebtedness of such
Person which is evidenced by a note, bond, debenture or similar instrument, (d) the
attributable Indebtedness of such Person with respect all Capitalized Lease
Obligations and Synthetic Lease Obligations, (e) all obligations of such
Person in respect of acceptances issued or created for the account of such
Person, (f) all Guarantee Obligations of such Person (excluding in any
calculation of consolidated Indebtedness of the Consolidated Group, Guarantee
Obligations of one member of the Consolidated Group in respect of primary
obligations of any other member of the Consolidated Group), (g) all
reimbursement obligations of such Person for letters of credit and other
contingent liabilities, (h) all net obligations of such Person under Swap
Contracts, and (i) all liabilities secured by any lien (other than liens
for taxes not yet due and payable) on any property owned by such Person even
though such 

 

9

 

Person
has not assumed or otherwise become liable for the payment thereof. The amount
of any net obligation under any Swap Contract on any date shall be deemed to be
the Swap Termination Value thereof as of such date. To the extent that the
rights and remedies of the obligee of any Indebtedness are limited to certain
Property and are otherwise non-recourse to such Person, the amount of such
Indebtedness shall be limited to the value of the Person’s interest in such
Property (valued at the higher of book value or market value as of the date of
determination).

 

“Intellectual Property” is
defined in Section 5.20.

 

“Interest Period” means a LIBOR Interest Period.

 

“Investment” of a Person means any loan, advance
(other than commission, travel and similar advances to officers and employees
made in the ordinary course of business), extension of credit (other than
accounts receivable arising in the ordinary course of business on terms
customary in the trade), deposit account or contribution of capital by such
Person to any other Person or any investment in, or purchase or other
acquisition of, the stock, partnership interests, notes, debentures or other
securities of any other Person made by such Person.

 

“Investment Affiliate” means any Person in which the
Consolidated Group, directly or indirectly, holds an ownership interest whose
financial results are not consolidated under GAAP with the financial results of
the Consolidated Group, excluding those Persons in whom the Consolidated Group’s
ownership interest is evidenced only by Marketable Securities.

 

“Issuance Date” is defined in Section 2A.4(a)(2).

 

“Issuance Notice” is defined in Section 2A.4(c).

 

“Issuing Bank” means, with respect to each Facility
Letter of Credit, the Lender which issues such Facility Letter of Credit.  KeyBank shall be the sole Issuing Bank.

 

“Lenders” means the lending institutions listed on the
signature pages of this Agreement, their respective successors and
assigns, any other lending institutions that subsequently become parties to
this Agreement.

 

“Lending Installation” means, with respect to a
Lender, any office, branch, subsidiary or affiliate of such Lender.

 

“Letter of Credit” of a Person means a letter of
credit or similar instrument which is issued upon the application of such
Person or upon which such Person is an account party or for which such Person
is in any way liable.

 

“Letter of Credit Collateral Account” is defined in Section 2A.9.

 

“Letter of Credit Request” is defined in Section 2A.4(a).

 

“Leverage Ratio” means, as of any date, the ratio of
Consolidated Outstanding Indebtedness to Total Asset Value.

 

“LIBOR Advance” means an Advance that bears interest
at the LIBOR Rate.

 

“LIBOR Applicable Margin” means, as of any date with
respect to any LIBOR Interest Period, the applicable per annum amount then in
effect pursuant to Section 2.3 hereof.

 

10

 

“LIBOR Base Rate” means, the average rate (rounded
upwards to the nearest 1/16th) with respect to a LIBOR Advance for
the relevant LIBOR Interest Period, the applicable British Bankers’ Association
LIBOR rate for deposits in U.S. dollars as reported by any generally
recognized financial information service as of 11:00 a.m. (London time)
two Business Days prior to the first day of such LIBOR Interest Period, and
having a maturity equal to such LIBOR Interest Period, provided that,
if no such British Bankers’ Association LIBOR rate is available to the
Administrative Agent, the applicable LIBOR Base Rate for the relevant LIBOR
Interest Period shall instead be the rate determined by the Administrative
Agent to be the rate at which KeyBank or one of its Affiliate banks offers to
place deposits in U.S. dollars with first-class banks in the London interbank
market at approximately 11:00 a.m. (London time) two Business Days prior
to the first day of such LIBOR Interest Period, in the approximate amount of
KeyBank’s relevant LIBOR Loan and having a maturity equal to such LIBOR
Interest Period.

 

“LIBOR Interest Period” means, with respect to each
amount bearing interest at a LIBOR based rate, a period of one, two, three, or
six months, to the extent deposits with such maturities are available to the
Administrative Agent, commencing on a Business Day, as selected by Borrower;
provided, however, that (i) any LIBOR Interest Period which would
otherwise end on a day which is not a Business Day shall continue to and end on
the next succeeding Business Day, unless the result would be that such LIBOR
Interest Period would be extended to the next succeeding calendar month, in
which case such LIBOR Interest Period shall end on the next preceding Business
Day and (ii) any LIBOR Interest Period which begins on a day for which
there is no numerically corresponding date in the calendar month in which such
LIBOR Interest Period would otherwise end shall instead end on the last
Business Day of such calendar month.

 

“LIBOR Loan” means a Loan which bears interest at a
LIBOR Rate.

 

“LIBOR Rate” means, for any LIBOR Interest Period, the
sum of (A) the LIBOR Base Rate applicable thereto divided by one minus the
then-current Reserve Requirement and (B) the LIBOR Applicable Margin.

 

“Lien” means any lien (statutory or other), mortgage,
pledge, hypothecation, assignment, deposit arrangement, encumbrance or
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including, without limitation, the interest of a
vendor or lessor under any conditional sale, Capitalized Lease or other title
retention agreement).

 

“Loan” means, with respect to a Lender, such Lender’s
portion of any Advance.

 

“Loan Documents” means this Agreement, the Notes, the
Subsidiary Guaranty, and any other document from time to time evidencing or
securing indebtedness incurred by the Borrower under this Agreement, as any of
the foregoing may be amended or modified from time to time.

 

“Marketable Securities” means Investments in Capital
Stock or debt securities issued by any Person (other than an Investment
Affiliate) which are publicly traded on a national exchange, excluding Cash
Equivalents.

 

“Material Adverse Effect” means, in the Administrative
Agent’s reasonable discretion, a material adverse effect on (i) the
business, Property or condition (financial or otherwise) of the Borrower and
its Subsidiaries taken as a whole, (ii) the ability of the Borrower to
perform its obligations under the Loan Documents, or (iii) the validity or
enforceability of any of the Loan Documents.

 

“Materials of Environmental Concern” means any
gasoline or petroleum (including crude oil or any fraction thereof) or
petroleum products or any hazardous or toxic substances, materials or wastes, 

 

11

 

defined or regulated as
such in or under any Environmental Law, including, without limitation,
asbestos, polychlorinated biphenyls and urea-formaldehyde insulation.

 

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

 

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

 

“Multiemployer Plan” means a Plan maintained pursuant
to a collective bargaining agreement or any other arrangement to which the
Borrower or any member of the Controlled Group is a party to which more than
one employer is obligated to make contributions.

 

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

 

“Net Operating Income” means, with respect to any
Project for any period, “property rental and other income” (as determined by
GAAP) attributable to such Project accruing for such period minus the
amount of all expenses (as determined in accordance with GAAP) incurred in
connection with and directly attributable to the ownership and operation of
such Project for such period, including, without limitation, Management Fees
and amounts accrued for the payment of real estate taxes and insurance
premiums, but excluding interest expense or other debt service charges and any
non-cash charges such as depreciation or amortization of financing costs.  As used herein “Management Fees”,
means, with respect to each Project for any period, an amount equal to the
greater of (i) actual management fees payable with respect thereto and (ii) three
percent (3%) per annum on the aggregate base rent and percentage rent due and
payable under leases at such Project.

 

“Non-U.S. Lender” is defined in Section 3.5(iv).

 

“Note” means a promissory note, in substantially the
form of Exhibit B hereto, duly executed by the Borrower and payable
to the order of a Lender in the amount of its Commitment, including any
amendment, modification, renewal or replacement of such promissory note.

 

“Notice of Assignment” is defined in Section 12.3.2.

 

“Obligations” means the Advances, the Facility Letter
of Credit Obligations, the Related Swap Obligations and all accrued and unpaid
fees and all other obligations of Borrower to the Administrative Agent or the
Lenders arising under this Agreement or any of the other Loan Documents.

 

“Occupancy Rate” means with respect to
a Project at any time, the ratio, expressed as a percentage, of (a) the
net rentable square footage of such Project actually occupied by tenants that
are not affiliated with the Borrower and paying rent at rates not materially
less than rates generally prevailing at the time the applicable lease was
entered into, pursuant to binding leases as to which no monetary default has
occurred and has continued unremedied for 60 or more days to (b) the 

 

12

 

aggregate net
rentable square footage of such Project. 
For purposes of the definition of “Occupancy Rate”, a tenant shall be
deemed to actually occupy a Project notwithstanding a temporary cessation of
operations for renovation, repairs or other temporary reason, or for the
purpose of completing tenant build-out or that is otherwise scheduled to be
open for business within 90 days of such date.

 

“Other Taxes” is defined in Section 3.5(ii).

 

“Outstanding Facility Amount” means, at any time, the
sum of all then outstanding Advances and Facility Letter of Credit Obligations.

 

“Participants” is defined in Section 12.2.1.

 

“Payment Date” means, with respect to the payment of
interest accrued on any Advance, the first day of each calendar month.

 

“PBGC” means the Pension Benefit Guaranty Corporation,
or any successor thereto.

 

“Percentage” means for each Lender the ratio that such
Lender’s Commitment bears to the Aggregate Commitment, expressed as a
percentage.

 

“Permitted Acquisitions” are defined in Section 6.15.

 

“Permitted Liens” are defined in Section 6.16.

 

“Person” means any natural person, corporation, firm,
joint venture, partnership, association, enterprise, trust or other entity or
organization, or any government or political subdivision or any agency,
department or instrumentality thereof.

 

“Plan” means an employee pension benefit plan which is
covered by Title IV of ERISA or subject to the minimum funding standards under Section 412
of the Code as to which the Borrower or any member of the Controlled Group may
have any liability.

 

“Prime Rate” means a rate per annum equal to the prime
rate of interest publicly announced from time to time by KeyBank or its parent
as its prime rate (which is not necessarily the lowest rate charged to any
customer), changing when and as said prime rate changes.  In the event that there is a successor to the
Administrative Agent by merger, or the Administrative Agent assigns its duties
and obligations to an Affiliate, then the term “Prime Rate” as used in this
Agreement shall mean the prime rate, base rate or other analogous rate of the
new Administrative Agent.

 

“Prohibited Person” is defined in Section 5.28.

 

“Project” means any real estate asset owned by
Borrower or any of its Subsidiaries or any Investment Affiliate, and operated
or intended to be operated as a retail property.

 

“Property” of a Person means any and all property,
whether real, personal, tangible, intangible, or mixed, of such Person, or
other assets owned, leased or operated by such Person.

 

“Qualifying Unencumbered
Property” means any Stabilized Retail Project which as of any date of
determination, (a) is wholly owned by a Subsidiary Guarantor, in fee
simple or under the terms of a Financeable Ground Lease, (b) is located in
the United States, (c) neither such Project, nor any interest of the
Borrower or any Subsidiary therein, is subject to any lien other than Permitted
Liens set forth in Sections 6.16(i) through 6.16(v) or a Negative
Pledge; (d) if such Project is owned or leased by a 

 

13

 

Subsidiary
Guarantor (i) none of the Borrower’s direct or indirect ownership interest
in such Subsidiary Guarantor is subject to any lien, or agreement  (including any agreement governing
Indebtedness incurred in order to finance or refinance the acquisition of such
Project) which prohibits or limits the ability of such Subsidiary Guarantor to
create, incur, assume or suffer to exist any Lien upon any Projects or Capital
Stock of such Subsidiary Guarantor or to a Negative Pledge; and (ii) the
Borrower directly, or indirectly through a Subsidiary, has the right to take
the following actions without the need to obtain the consent of any Person: (x) to
sell, transfer or otherwise dispose of such Project and (y) to create a
Lien on such Project as security for Indebtedness of the Borrower or such
Subsidiary Guarantor, as applicable; (e) is not subject to any agreement
(including any agreement governing Indebtedness incurred in order to finance or
refinance the acquisition of such Project) which entitles any Person to the
benefit of any Lien (other than Permitted Liens set forth in Sections 6.16(i) through
6.16(iv)) on any Project or Capital Stock of such Subsidiary Guarantor or would
entitle any Person to the benefit of any such Lien upon the occurrence of any
contingency (including, without limitation, pursuant to an “equal and ratable”
clause); (f) such Project is free of all structural defects or major
architectural deficiencies, title defects, environmental conditions or other
adverse matters except for defects, deficiencies, conditions or other matters
individually or collectively which are not material to the profitable operation
of such Project as evidenced by a certification of the Borrower;  and (g) when aggregated with all other
Qualifying Unencumbered Properties, results in the Qualifying Unencumbered
Properties as a whole having at least eighty percent (80%) of their aggregate
gross leasable area physically occupied. 
No asset shall be deemed to be unencumbered unless both such asset and
all Capital Stock of the Subsidiary Guarantor owning such asset is unencumbered
and neither such Subsidiary Guarantor nor any other intervening Subsidiary
between the Borrower and such Subsidiary Guarantor has any Indebtedness for
borrowed money (other than Indebtedness due to the Borrower).

 

 “Recourse
Indebtedness” means any Indebtedness of Borrower or any other member of the
Consolidated Group with respect to which the liability of the obligor is not
limited to the obligor’s interest in specified assets securing such
Indebtedness, subject to customary limited exceptions for certain acts or types
of liability.

 

“Regulation D” means Regulation D of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor thereto or other regulation or official interpretation of said Board
of Governors relating to reserve requirements applicable to member banks of the
Federal Reserve System.

 

“Regulation U” means Regulation U of the Board of
Governors of the Federal Reserve System as from time to time in effect and any
successor or other regulation or official interpretation of said Board of
Governors relating to the extension of credit by banks for the purpose of
purchasing or carrying margin stocks applicable to member banks of the Federal
Reserve System.

 

“Reimbursement Obligations” means at any time, the
aggregate of the obligations of the Borrower to the Lenders, the Issuing Bank
and the Administrative Agent in respect of all unreimbursed payments or
disbursements made by the Lenders, the Issuing Bank and the Administrative
Agent under or in respect of the Facility Letters of Credit.

 

“Related Swap Obligations” means, as of any date, all
of the obligations of Borrower arising under any then outstanding Swap
Contracts entered into between Borrower and any Lender or Affiliate of any
Lender.

 

“Reportable Event” means a reportable event as defined
in Section 4043 of ERISA and the regulations issued under such section,
with respect to a Plan, excluding, however, such events as to which the PBGC by
regulation waived the requirement of Section 4043(a) of ERISA that it
be notified 

 

14

 

within 30 days of the
occurrence of such event, provided, however, that a failure to meet the minimum
funding standard of Section 412 of the Code and of Section 302 of
ERISA shall be a Reportable Event regardless of the issuance of any such waiver
of the notice requirement in accordance with either Section 4043(a) of
ERISA or Section 412(d) of the Code.

 

“Required Lenders” means Lenders in the aggregate
having at least 66 2/3% of the Aggregate Commitment or, if the Aggregate
Commitment has been terminated, Lenders in the aggregate holding at least 66
2/3% of the aggregate unpaid principal amount of the outstanding Advances and
Facility Letter of Credit Obligations.

 

“Reserve Requirement” means, with respect to a LIBOR
Loan and LIBOR Interest Period, that percentage (expressed as a decimal) which
is in effect on such day, as prescribed by the Federal Reserve Board or other
governmental authority or agency having jurisdiction with respect thereto for
determining the maximum reserves (including, without limitation, basic,
supplemental, marginal and emergency reserves) for eurocurrency funding
(currently referred to as “Eurocurrency Liabilities” in Regulation D)
maintained by a member bank of the Federal Reserve System.

 

“Section” means a numbered section of this Agreement,
unless another document is specifically referenced.

 

“Secured Indebtedness” means
any Indebtedness of the Borrower or any other member of the Consolidated Group
which is secured by a Lien on a Project, any ownership interests in any Person
or any other assets which had, in the aggregate, a value in excess of the
amount of such Indebtedness at the time such Indebtedness was incurred.

 

“Single Employer Plan” means a Plan maintained by the
Borrower or any member of the Controlled Group for employees of the Borrower or
any member of the Controlled Group.

 

“S&P” means Standard & Poor’s Ratings
Group and its successors.

 

“Stabilized Retail Projects” mean any neighborhood
shopping centers, community shopping centers, sale/leaseback with retail
tenants, stand-alone, triple net retail properties and any other stabilized
Projects approved by the Administrative Agent.

 

“Subsidiary” of a Person means (i) any
corporation more than 50% of the outstanding securities having ordinary voting
power of which shall at the time be owned or controlled, directly or
indirectly, by such Person or by one or more of its Subsidiaries or by such
Person and one or more of its Subsidiaries, or (ii) any partnership,
association, joint venture or similar business organization more than 50% of
the ownership interests having ordinary voting power of which shall at the time
be so owned or controlled.  Unless
otherwise expressly provided, all references herein to a “Subsidiary” shall
mean a Subsidiary of the Borrower.

 

“Subsidiary Guarantor” means each Wholly-Owned
Subsidiary of the Borrower which is required to execute a Subsidiary Guaranty
pursuant to Section 6.13.

 

“Subsidiary Guaranty” means the guaranty to be
executed and delivered by those Subsidiaries of the Borrower listed on Schedule
6 and such other Wholly-Owned Subsidiaries as may hereafter be obligated to
join in such guaranty as provided in Section 6.13, substantially in
the form of Exhibit F, as the same may be amended, supplemented or
otherwise modified from time to time.

 

“Substantial Portion” means, with respect to the
Property of the Borrower and its Subsidiaries, Property which represents more
than 10% of then-current Total Asset Value.

 

15

 

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

 

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

 

“Swingline Advances” means, as of any date,
collectively, all Swingline Loans then outstanding under this Facility.

 

“Swingline Commitment” means the obligation of the
Swingline Lender to make Swingline Loans not exceeding $25,000,000, which is
included in, and is not in addition to, the Swingline Lender’s total Commitment
hereunder.

 

“Swingline Lender” shall mean KeyBank National
Association, in its capacity as a Lender, and at the option of a new
Administrative Agent, any successor Administrative Agent.

 

“Swingline Loan” means a loan made by the Swingline
Lender pursuant to Section 2.16 hereof.

 

“Taxes” means any and all present or future taxes,
duties, levies, imposts, deductions, charges or withholdings, and any and all
liabilities with respect to the foregoing, but excluding Excluded Taxes and
Other Taxes.

 

“Total Asset Value” means, as of any date, (i) Adjusted
Annual NOI attributable to Projects owned by the Borrower or a member of the
Consolidated Group (excluding 100% of the Adjusted Annual NOI attributable to
Projects not owned for the entire fiscal quarter on which Adjusted Annual NOI
is calculated and for the five (5) immediately proceeding entire fiscal
quarters and excluding all lease termination fees and all interest and dividend
income), divided by the Capitalization Rate, plus (ii) 100% of the price
paid for any such Projects first acquired by the Borrower or a member of the
Consolidated Group during such period of six (6) consecutive entire fiscal
quarters, plus (iii) Unrestricted Cash, Cash Equivalents and Marketable
Securities owned by the Consolidated Group as of the end of the last such
fiscal quarter, plus (iv) the Consolidated Group’s Pro Rata Share of (A) Adjusted
Annual NOI attributable to Projects owned by Investment Affiliates (excluding
Adjusted Annual NOI attributable to Projects not owned for the entire fiscal
quarter on which Adjusted Annual NOI is calculated and for the five (5) entire
immediately preceding fiscal quarters) divided by (B) the 

 

16

 

Capitalization Rate, plus
(v) the Consolidated Group Pro Rata Share of the price paid for such
Projects first acquired by an Investment Affiliate during such period of six (6) consecutive
entire fiscal quarters, plus (vi) Construction in Progress and First
Mortgage Receivables of the Borrower or any other member of the Consolidated
Group (with each such asset valued at the lower of its acquisition cost and its
fair market value), plus (vii) Unimproved Land (with each such asset
valued at the lower of its acquisition cost and its fair market value).

 

“Transferee” is defined in Section 12.4.

 

“Trapped Equity Property” means any Stabilized Retail
Project which would qualify as a Qualifying Unencumbered Property, except that
it is subject to a first mortgage lien securing Secured Indebtedness, provided
that such Trapped Equity Property shall cease to be a Trapped Equity Property
upon the first to occur of  (a) the
maturity date of the Secured Indebtedness secured by such Trapped Equity
Property, and (b) the date such Secured Indebtedness is refinanced or
otherwise prepaid in full.

 

“Trapped Equity Property Value” means, as of any date,
with respect to all Stabilized Retail Projects that constitute Trapped Equity
Properties on such date, the aggregate Net Operating Income for such Trapped
Equity Property for the most recent fiscal quarter of Borrower for which
financial results have been reported multiplied by four (4) and divided by
the Capitalization Rate.

 

“Type” means, with respect to any Advance, its nature
as a Floating Rate Advance or LIBOR Advance.

 

“Unencumbered Asset Value” means, as of any date, the
sum of (a) (i) the aggregate Adjusted Unencumbered NOI attributable
to Qualifying Unencumbered Properties then owned by Borrower or a Subsidiary
Guarantor which have been owned by Borrower or a Subsidiary Guarantor for the
most recent full fiscal quarter for which financial results of Borrower have
been reported and for the five (5) immediately preceding entire fiscal
quarters multiplied by four and divided by (ii) the Capitalization Rate
plus (b) the aggregate acquisition cost of all Qualifying Unencumbered
Properties then owned by Borrower or a Subsidiary Guarantor but not so owned
for such period of six (6) consecutive entire fiscal quarters, plus (c) the
GAAP book value of Development Projects not subject to any Lien (other than Permitted
Liens set forth in Sections 6.16(i) through 6.16(v)) or any Negative Pledge, plus (d) all
Unrestricted Cash, Cash Equivalents, and Marketable Securities and all First
Mortgage Receivables (valued at the lower of its acquisition cost and its fair
market value).  For purposes of this
definition, to the extent i) the aggregate amount included in Unencumbered
Asset Value under clause (d) above would exceed 10% of the Unencumbered
Asset Value, or ii) the aggregate amount included in Unencumbered Asset Value
attributable to Development Properties under clause (c) above would exceed
15% of the Unencumbered Pool Asset  Value
or the aggregate amount included under clause (c) and (d) together
would exceed 20% of Unencumbered Asset Value, such excess shall be
excluded.  To the extent Unencumbered
Asset Value attributable to Qualifying Unencumbered Properties which are
occupied pursuant to Financeable Ground Leases would exceed 10% of Unencumbered
Asset Value, such excess shall be excluded.

 

“Unencumbered Leverage Ratio” means Unencumbered Asset
Value divided by Unsecured Indebtedness.

 

“Unencumbered NOI” means, as
of any date, the sum of (a) the aggregate Net Operating Income for the
most recent fiscal quarter for which financial results have been reported
attributable to all Qualifying Unencumbered Properties owned for the entirety
of such fiscal quarter as of the last day of such fiscal quarter plus, (b) in
the case of any Qualifying Unencumbered Property that was owned as of the last
day of such fiscal quarter by Borrower or a Subsidiary Guarantor, but not so
owned for the full 

 

17

 

fiscal
quarter, the additional amount of Net Operating Income that would have been
earned if such Qualifying Unencumbered Property had been so owned for the full
fiscal quarter.

 

“Unencumbered Trigger Date” means the first to occur
of (i) the fifth (5th) day subsequent to the date on which the
Administrative Agent receives a compliance certificate pursuant to Section 6.1(v) evidencing
that Borrower has achieved an Unencumbered Leverage Ratio of at least 1.50,
provided that the Administrative Agent does not object to the information
provided in such certificate, or (ii) December 31, 2008.

 

“Unfunded Liabilities” means the amount (if any) by
which the present value of all vested nonforfeitable benefits under all Single
Employer Plans exceeds the fair market value of all such Plan assets allocable
to such benefits, all determined as of the then most recent valuation date for
such Plans.

 

“Unimproved Land” means, as of any date, any land
which (i) is not appropriately zoned for retail development, (ii) does
not have access to all necessary utilities or (iii) does not have access
to publicly dedicated streets, unless such land has been designated in writing
by the Borrower in a certificate delivered to the Administrative Agent as land
that is reasonably expected to satisfy all such criteria within twelve (12)
months after such date.

 

“Unmatured Default” means an event which but for the
lapse of time or the giving of notice, or both, would constitute a Default.

 

“Unrestricted Cash, Cash Equivalents and Marketable
Securities” means, in the aggregate, all cash, Cash Equivalents and Marketable
Securities which are not pledged or otherwise restricted for the benefit of any
creditor and which are owned by the Borrower or another member of the
Consolidated Group, to be valued for purposes of this Agreement at 100% of its
then-current book value, as determined under GAAP.

 

“Unsecured Debt Service” means, as of any date, an
imputed annual amount of interest that would be due on the outstanding amount
of Unsecured Indebtedness as of the last day of the most recent fiscal quarter
of Borrower for which financial results have been reported calculated at the
interest rate applicable to such Unsecured Indebtedness as of such last day
(using the LIBOR Rate and LIBOR Applicable Margin in effect on such last day
for purposes of calculating interest on the Facility Outstandings).

 

“Unsecured Debt Service
Coverage” means Adjusted Unencumbered NOI divided by Unsecured Debt Service.

 

“Unsecured Indebtedness”
means all Consolidated Outstanding Indebtedness that is not Secured
Indebtedness.

 

“Unused Fee” is defined in Section 2.5.

 

“Unused Fee Percentage” means, with respect to any
calendar quarter, (i) 0.15% per annum, if the daily average of the sum of
the Advances and Facility Letter of Credit Obligations outstanding during such
quarter is 50% or more of the daily average Aggregate Commitment during such
quarter or (ii) 0.20% per annum if the average of the sum of the Advances
and Facility Letter of Credit Obligations outstanding during such quarter is
less than 50% of the daily average Aggregate Commitment during such quarter.

 

“Wholly-Owned Subsidiary” of a Person means (i) any
Subsidiary all of the outstanding voting securities of which shall at the time
be owned or controlled, directly or indirectly, by such Person or one 

 

18

 

or more Wholly-Owned
Subsidiaries of such Person, or by such Person and one or more Wholly-Owned
Subsidiaries of such Person, or (ii) any partnership, association, joint
venture or similar business organization 100% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.

 

The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms.

 

ARTICLE II

THE CREDIT

 

2.1 Generally.  Subject to the terms and conditions of this
Agreement, Lenders severally agree to make Advances through the Administrative
Agent to Borrower from time to time prior to the Facility Termination Date, and
to support the issuance of the Facility Letters of Credit under Article IIA
of this Agreement, provided  that the making of any such Advance
or the issuance of such Facility Letter of Credit will not:

 

(i)                                     cause the then-
current Outstanding Facility Amount to exceed the then-current Aggregate
Commitment; or

 

(ii)                                  cause, at any
time through and including the Unencumbered Trigger Date, the then-current
Outstanding Facility Amount to exceed the Aggregate Pool Value; or

 

(iii)                               cause the
then-current outstanding Swingline Advances to exceed the Swingline Commitment;
or

 

(iv)                              cause the then
outstanding Facility Letters of Credit Obligations to exceed the Facility
Letter of Credit Sublimit.

 

The Advances may be Swingline Advances or
ratable Floating Rate Advances and ratable Fixed Rate Advances.  Each Lender shall fund its Percentage of each
such Advance (other than a Swingline Advance) and no Lender will be required to
fund any amounts which, when aggregated with such Lender’s Percentage of all
other Advances then outstanding and of all Facility Letter of Credit
Obligations, would exceed such Lender’s then-current Commitment.  This facility (“Facility”) is a
revolving credit facility and, subject to the provisions of this Agreement,
Borrower may request Advances hereunder, repay such Advances and reborrow
Advances at any time prior to the Facility Termination Date.

 

2.2 Termination or
Increase in Aggregate Commitment.  The Borrower shall have the right to
terminate the Aggregate Commitment in full by giving written notice thereof to
the Administrative Agent not less than one (1) Business Day prior to the
date of such termination and by repaying all Obligations in full on such
date.  The Borrower shall also have the
right from time to time, provided no Default or Unmatured Default has occurred
and is then continuing, to increase the Aggregate Commitment up to a maximum of
$300,000,000 by either adding new lenders as Lenders (subject to the
Administrative Agent’s prior written approval of the identity of such new lenders)
or obtaining the agreement, which shall be at such Lender’s or Lenders’ sole
discretion, of one or more of the then current Lenders to increase its or their
Commitments.  The Administrative Agent
shall use commercially reasonable efforts to arrange such increased Commitments
and the Borrower’s approval of any new lenders shall not be unreasonably
withheld or delayed.  On the effective
date of any such increase, the Borrower shall pay to the Administrative Agent
any amounts due to it under 

 

19

 

the Fee Letter and to each lender providing
such additional Commitment the up-front fee agreed to by the Borrower.  Such increases shall be evidenced by the
execution and delivery of an Amendment Regarding Increase in the form of Exhibit A
attached hereto by the Borrower, the Administrative Agent and the new lender or
existing Lender providing such additional Commitment, a copy of which shall be
forwarded to each Lender by the Administrative Agent promptly after execution
thereof.  On the effective date of each
such increase in the Aggregate Commitment, the Borrower and the Administrative
Agent shall cause the new or existing Lenders providing such increase, by
either funding more than its or their Percentage of new Advances made on such
date or purchasing shares of outstanding Loans held by the other Lenders or a
combination thereof, to hold its or their Percentage of all Advances
outstanding at the close of business on such day.  The Lenders agree to cooperate in any
required sale and purchase of outstanding Advances to achieve such result.  In no event shall the Aggregate Commitment
exceed $300,000,000 without the approval of all of the Lenders.

 

2.3 Applicable
Margins.  The interest due hereunder
with respect to the Advances shall vary from time to time and shall be
determined by reference to the Type of Advance, the then-current Leverage Ratio
and whether or not the Unencumbered Trigger Date has occurred. Any such change
in the Applicable Margin shall be made on the fifth (5th) day subsequent to the date
on which the Administrative Agent receives a compliance certificate pursuant to
Section 6.1(v) with respect to the preceding fiscal quarter of
Borrower, provided that the Administrative Agent does not object to the
information provided in such certificate. Such changes shall be given
prospective effect only, and no recalculation shall be done with respect to
interest or Letter of Credit Fees accrued prior to the date of such change in
the Applicable Margin. If any such compliance certificate shall later be
determined to be incorrect and as a result a higher Applicable Margin should
have been in effect for any period, Borrower shall pay to the Administrative
Agent for the benefit of the Lenders all additional interest and fees which
would have accrued if the original compliance certificate had been correct, as
shown on an invoice to be prepared by the Administrative Agent and delivered to
Borrower, on the next Payment Date following delivery of such invoice. The per annum
Applicable Margins that will be either added to the Alternate Base Rate to
determine the Floating Rate or added to LIBOR Base Rate (as adjusted for any
Reserve Requirement) to determine the LIBOR Rate for any LIBOR Interest Period
shall be determined as follows:

 

Before Unencumbered Trigger Date

 

	
  Leverage Ratio

  	
   

  	
  Libor Applicable Margin

  	
   

  	
  ABR Applicable Margin

  	
   

  
	
  < 40%

  	
   

  	
  1.20%

  	
   

  	
  0

  	
   

  
	
  > 40% but < 50%

  	
   

  	
  1.35%

  	
   

  	
  0

  	
   

  
	
  > 50% but < 55%

  	
   

  	
  1.50%

  	
   

  	
  0.25%

  	
   

  
	
  > 55%

  	
   

  	
  1.65%

  	
   

  	
  0.35%

  	
   

  

 

After Unencumbered Trigger Date

 

	
  Leverage Ratio

  	
   

  	
  Libor Applicable Margin

  	
   

  	
  ABR Applicable Margin

  	
   

  
	
  <40%

  	
   

  	
  1.00%

  	
   

  	
  0

  	
   

  
	
  > 40% but < 50%

  	
   

  	
  1.15%

  	
   

  	
  0

  	
   

  
	
  > 50% but < 55%

  	
   

  	
  1.35%

  	
   

  	
  0.25%

  	
   

  
	
  > 55%

  	
   

  	
  1.50%

  	
   

  	
  0.30%

  	
   

  

 

The Applicable Margins in the “After Unencumbered
Trigger Date” table shall apply, provided that no Event of Default or
Unmatured Default has occurred and is then continuing, on the Unencumbered
Trigger Date.

 

20

 

2.4  Final
Principal Payment.  Any outstanding
Advances and all other unpaid Obligations shall be paid in full by the Borrower
on the Facility Termination Date.

 

2.5  Unused Fee.  The Borrower agrees to pay to the
Administrative Agent for the account of each Lender an unused facility fee (the
“Unused Fee”) equal to an aggregate amount computed on a daily basis for
such calendar year by multiplying the Unused Fee Percentage applicable to such
calendar quarter, calculated as a per diem rate, times the excess of the
Aggregate Commitment over the Outstanding Facility Amount on each day of such
calendar quarter.  The Unused Fee shall
be payable quarterly in arrears on the first Business Day after the last day of
each calendar quarter.

 

2.6  Other Fees.  The Borrower agrees to pay all fees payable
to the Administrative Agent and Syndication Agent pursuant to the Borrower’s
letter agreement with the Administrative Agent and Syndication Agent dated as
of February 26, 2008 (the “Fee Letter”).

 

2.7  Minimum Amount
of Each Advance.  Each Advance shall
be in the minimum amount of $1,000,000; provided, however, that any Floating
Rate Advance may be in the amount of the unused Aggregate Commitment.

 

2.8  Optional
Principal Payments.  The Borrower may
from time to time pay, without penalty or premium, all or any part of
outstanding Floating Rate Advances without prior notice to the Administrative
Agent.  A Fixed Rate Advance may be paid
on the last day of the applicable Interest Period or, if and only if the
Borrower pays any amounts due to the Lenders under Section 3.4 as a
result of such prepayment, on a day prior to such last day.

 

2.9  Method of
Selecting Types and Interest Periods for New Advances.  Each Advance hereunder shall consist of Loans
made from the several Lenders ratably in proportion to the ratio their
respective Commitments bear to the Aggregate Commitment, except for Swingline
Loans which shall be made by the Swingline Lender in accordance with Section 2.16.  The Borrower shall select the Type of Advance
and, in the case of each Fixed Rate Advance, the Interest Period applicable to
each Advance from time to time.  The
Borrower shall give the Administrative Agent irrevocable notice (a “Borrowing
Notice”) in the form attached as Exhibit I (i) not later
than 3:00 p.m. Cleveland time on the Business Day immediately preceding
the Borrowing Date of each Floating Rate Advance (other than Swingline
Advances), (ii) not later than 10:00 a.m. Cleveland time, at least
three (3) Business Days before the Borrowing Date for each LIBOR Advance,
and (iii) not later than 10:00 a.m. Cleveland, Ohio time on the same
day as the Borrowing Date for each Swingline Advance, which shall specify:

 

(i)                                     the Borrowing
Date, which shall be a Business Day, of such Advance,

 

(ii)                                  the aggregate
amount of such Advance,

 

(iii)                               the Type of
Advance selected and,

 

(iv)                              in the case of
each Fixed Rate Advance, the Interest Period applicable thereto.

 

The Administrative Agent shall provide a copy to the
Lenders by facsimile of each Borrowing Notice and each Conversion/Continuation
Notice not later than the close of business on the Business Day it is
received.  Each Lender shall make
available its Loan or Loans, in funds immediately available in Cleveland to the
Administrative Agent at its address specified pursuant to Article XIII
on each Borrowing Date not later than (i) 10:00 a.m. (Cleveland
time), in the case of Floating Rate Advances which have been requested by a
Borrowing Notice given to the Administrative Agent not later than 3:00 p.m.
(Cleveland time) on the Business Day immediately preceding such Borrowing Date,
or (ii) noon 

 

21

 

(Cleveland time) in the
case of all other Advances.  The
Administrative Agent will make the funds so received from the Lenders available
to the Borrower at the Administrative Agent’s aforesaid address.

 

No Interest Period may end after the Facility
Termination Date and, unless the Lenders otherwise agree in writing, in no
event may there be more than seven (7) different Interest Periods for
LIBOR Advances outstanding at any one time.

 

2.10                                                   Conversion and
Continuation of Outstanding Advances.  Floating Rate Advances shall continue as
Floating Rate Advances unless and until such Floating Rate Advances are
converted into Fixed Rate Advances.  Each
Fixed Rate Advance shall continue as a Fixed Rate Advance until the end of the
then applicable Interest Period therefor, at which time such Fixed Rate Advance
shall be automatically converted into a Floating Rate Advance unless the Borrower
shall have given the Administrative Agent a Conversion/Continuation Notice
requesting that, at the end of such Interest Period, such Fixed Rate Advance
either continue as a Fixed Rate Advance for the same or another Interest Period
or be converted to an Advance of another Type. 
Subject to the terms of Section 2.7, the Borrower may elect
from time to time to convert all or any part of an Advance of any Type into any
other Type or Types of Advances; provided that any conversion of any Fixed Rate
Advance shall be made on, and only on, the last day of the Interest Period
applicable thereto.  The Borrower shall
give the Administrative Agent irrevocable notice (a “Conversion/Continuation
Notice”) of each conversion of an Advance to a Fixed Rate Advance or
continuation of a Fixed Rate Advance not later than 10:00 a.m. (Cleveland
time), at least three Business Days, in the case of a conversion into or
continuation of a LIBOR Advance, prior to the date of the requested conversion
or continuation, specifying:

 

(i)                                     the requested
date which shall be a Business Day, of such conversion or continuation;

 

(ii)                                  the aggregate
amount and Type of the Advance which is to be converted or continued; and

 

(iii)                               the amount and
Type(s) of Advance(s) into which such Advance is to be converted or
continued and, in the case of a conversion into or continuation of a Fixed Rate
Advance, the duration of the Interest Period applicable thereto.

 

2.11                                                   Changes in
Interest Rate, Etc.  Each
Floating Rate Advance shall bear interest on the outstanding principal amount
thereof, for each day from and including the date such Advance is made or is
converted from a Fixed Rate Advance into a Floating Rate Advance pursuant to Section 2.10
to but excluding the date it becomes due or is converted into a Fixed Rate
Advance pursuant to Section 2.10 hereof, at a rate per annum equal
to the Floating Rate for such day. 
Changes in the rate of interest on that portion of any Advance
maintained as a Floating Rate Advance will take effect simultaneously with each
change in the Alternate Base Rate.  Each
Fixed Rate Advance shall bear interest from and including the first day of the
Interest Period applicable thereto to (but not including) the last day of such
Interest Period at the interest rate determined as applicable to such Fixed
Rate Advance.

 

2.12                                                   Rates
Applicable After Default. 
Notwithstanding anything to the contrary contained in Section 2.9
or 2.10, during the continuance of a Default or Unmatured Default the
Required Lenders may, at their option, by notice to the Borrower (which notice
may be revoked at the option of the Required Lenders notwithstanding any
provision of Section 8.2 requiring unanimous consent of the Lenders
to changes in interest rates), declare that no Advance may be made as, converted
into or continued as a Fixed Rate Advance. 
During the continuance of a Default 

 

22

 

the Required Lenders may, at
their option, by notice to the Borrower (which notice may be revoked at the
option of the Required Lenders notwithstanding any provision of Section 8.2
requiring unanimous consent of the Lenders to changes in interest rates),
declare that (i) each Fixed Rate Advance shall bear interest for the
remainder of the applicable Interest Period at the rate otherwise applicable to
such Interest Period plus 2% per annum and (ii) each Floating Rate Advance
shall bear interest at a rate per annum equal to the Floating Rate otherwise
applicable to the Floating Rate Advance plus 2% per annum; provided, however,
that the Default Rate shall become applicable automatically if a Default occurs
under Section 7.1 or 7.2, unless waived by the Required
Lenders.

 

2.13                                                                           Method of
Payment.  All payments of the
Obligations hereunder shall be made, without setoff, deduction, or
counterclaim, in immediately available funds to the Administrative Agent at the
Administrative Agent’s address specified pursuant to Article XIII,
or at any other Lending Installation of the Administrative Agent specified in
writing by the Administrative Agent to the Borrower, by noon (local time) on
the date when due and shall be applied ratably by the Administrative Agent
among the Lenders.

 

(i)                                     As provided
elsewhere herein, all Lenders’ interests in the Advances and the Loan Documents
shall be ratable undivided interests and none of such Lenders’ interests shall
have priority over the others.  Each
payment delivered to the Administrative Agent for the account of any Lender or
amount to be applied or paid by the Administrative Agent to any Lender shall be
paid promptly (on the same day as received by the Administrative Agent if
received prior to noon (local time) on such day and otherwise on the next
Business Day) by the Administrative Agent to such Lender in the same type of
funds that the Administrative Agent received at its address specified pursuant
to Article XIII or at any Lending Installation specified in a
notice received by the Administrative Agent from such Lender.  Payments received by the Administrative Agent
but not timely funded to the Lenders shall bear interest payable by the
Administrative Agent at the Federal Funds Effective Rate from the date due
until the date paid.  The Administrative
Agent is hereby authorized to charge the account of the Borrower maintained
with KeyBank for each payment of principal, interest and fees as it becomes due
hereunder.

 

2.14                                                                           Notes;
Telephonic Notices.  Each Lender
is hereby authorized to record the principal amount of each of its Loans and
each repayment on the schedule attached to its Note, provided, however, that
the failure to so record shall not affect the Borrower’s obligations under such
Note.  The Borrower hereby authorizes the
Lenders and the Administrative Agent to extend, convert or continue Advances,
effect selections of Types of Advances and to transfer funds based on
telephonic notices made by any Authorized Officer.  The Borrower agrees to deliver promptly to
the Administrative Agent a written confirmation, if such confirmation is
requested by the Administrative Agent or any Lender, of each telephonic notice
signed by an Authorized Officer.  If the
written confirmation differs in any material respect from the action taken by
the Administrative Agent and the Lenders, the records of the Administrative
Agent and the Lenders shall govern absent manifest error.  The Administrative Agent will at the request
of the Borrower, from time to time, but not more often than monthly, provide
notice of the amount of the outstanding Aggregate Commitment, the Type of
Advance, and the applicable interest rate, if for a Fixed Rate Advance.  Upon a Lender’s furnishing to Borrower an
affidavit to such effect, if a Note is mutilated, destroyed, lost or stolen,
Borrower shall deliver to such Lender, in substitution therefore, a new note
containing the same terms and conditions as such Note being replaced.

 

2.15                                                                           Interest
Payment Dates; Interest and Fee Basis.  Interest accrued on each Advance shall be
payable on each Payment Date, commencing with the first such date to occur
after the date hereof, at maturity, whether by acceleration or otherwise, and
upon any termination of the 

 

23

 

Aggregate Commitment in its
entirety under Section 2.2 hereof. 
Interest, Unused Fees, Facility Letter of Credit Fees and all other fees
shall be calculated for actual days elapsed on the basis of a 360-day
year.  Interest shall be payable for the
day an Advance is made but not for the day of any payment on the amount paid if
payment is received prior to noon (local time) at the place of payment.  If any payment of principal of or interest on
an Advance shall become due on a day which is not a Business Day, such payment
shall be made on the next succeeding Business Day and, in the case of a
principal payment, such extension of time shall be included in computing
interest in connection with such payment.

 

2.16                                                                           Swingline
Advances. In addition to the other options available to the
Borrower hereunder, the Swingline Commitment shall be available for Swingline
Advances subject to the following terms and conditions.  Swingline Advances shall be made available
for same day borrowings provided that notice is given in accordance with Section 2.9
hereof.  All Swingline Advances shall
bear interest at the Floating Rate. In no event shall the Swingline Lender be
required to fund a Swingline Advance if it would increase the total aggregate
outstanding Loans by Swingline Lender hereunder plus its Percentage of Facility
Letter of Credit Obligations to an amount in excess of the Swingline Lender’s
Commitment.  No Swingline Advance may be
made to repay a Swingline Advance, but Borrower may repay Swingline Advances
from subsequent pro rata Advances hereunder. 
On the seventh (7th) Day after
such a Swingline Advance was made, if such Swingline Advance has not been
repaid by the Borrower, each Lender irrevocably agrees to purchase its
Percentage of any Swingline Advance made by the Swingline Lender regardless of
whether the conditions for disbursement are satisfied at the time of such
purchase, including the existence of an Unmatured Default or Default hereunder
provided that Swingline Lender did not have actual knowledge of such Unmatured
Default or Default at the time the Swingline Advance was made and provided
further that no Lender shall be required to have total outstanding Loans plus
its Percentage of Facility Letters of Credit exceed its Commitment.  Such purchase shall take place on the date of
the request by Swingline Lender so long as such request is made by noon
(Cleveland time), and otherwise on the Business Day following such
request.  All requests for purchase shall
be in writing.  From and after the date
it is so purchased, each such Swingline Advance shall, to the extent purchased,
(i) be treated as a Loan made by the purchasing Lenders and not by the
selling Lender for all purposes under this Agreement and the payment of the
purchase price by a Lender shall be deemed to be the making of a Loan by such
Lender and shall constitute outstanding principal under such Lender’s Note, and
(ii) shall no longer be considered a Swingline Advance except that all
interest accruing on or attributable to such Swingline Advance for the period
prior to the date of such purchase shall be paid when due by the Borrower to
the Administrative Agent for the benefit of the Swingline Lender and all such
amounts accruing on or attributable to such Loans for the period from and after
the date of such purchase shall be paid when due by the Borrower to the
Administrative Agent for the benefit of the purchasing Lenders.  If prior to purchasing its Percentage of a
Swingline Advance one of the events described in Section 7.7 shall
have occurred and such event prevents the consummation of the purchase
contemplated by preceding provisions, each Lender will purchase an undivided
participating interest in the outstanding Swingline Advance in an amount equal
to its Percentage of such Swingline Advance. 
From and after the date of each Lender’s purchase of its participating
interest in a Swingline Advance, if the Swingline Lender receives any payment on
account thereof, the Swingline Lender will distribute to such Lender its
participating interest in such amount (appropriately adjusted, in the case of
interest payments, to reflect the period of time during which such Lender’s
participating interest was outstanding and funded); provided, however, that in
the event that such payment was received by the Swingline Lender and is
required to be returned to the Borrower, each Lender will return to the
Swingline Lender any portion thereof previously distributed by the Swingline
Lender to it.  If any Lender fails to so
purchase its Percentage of any Swingline Advance, such Lender shall be deemed
to be a Defaulting Lender hereunder.

 

24

 

2.17                                                   Notification of
Advances, Interest Rates and Prepayments.  The Administrative Agent will notify each
Lender of the contents of each Borrowing Notice, Conversion/Continuation
Notice, and repayment notice received by it hereunder not later than the close
of business on the Business Day such notice is received by the Administrative
Agent.  The Administrative Agent will
notify each Lender of the interest rate applicable to each Fixed Rate Advance
promptly upon determination of such interest rate and will give each Lender
prompt notice of each change in the Alternate Base Rate.

 

2.18                                                   Lending
Installations.  Each Lender
may book its Loans at any Lending Installation selected by such Lender and may
change its Lending Installation from time to time.  All terms of this Agreement shall apply to
any such Lending Installation and the Notes shall be deemed held by each Lender
for the benefit of such Lending Installation. 
Each Lender may, by written or telex notice to the Administrative Agent
and the Borrower, designate a Lending Installation through which Loans will be
made by it and for whose account Loan payments are to be made.

 

2.19                                                   Non-Receipt of
Funds by the Administrative Agent.  Unless the Borrower or a Lender, as the case
may be, notifies the Administrative Agent prior to the time at which it is
scheduled to make payment to the Administrative Agent of (i) in the case
of a Lender, the proceeds of a Loan or (ii) in the case of the Borrower, a
payment of principal, interest or fees to the Administrative Agent for the
account of the Lenders, that it does not intend to make such payment, the
Administrative Agent may assume that such payment has been made.  The Administrative Agent may, but shall not
be obligated to, make the amount of such payment available to the intended
recipient in reliance upon such assumption. 
If such Lender or the Borrower, as the case may be, has not in fact made
such payment to the Administrative Agent, the recipient of such payment shall,
on demand by the Administrative Agent, repay to the Administrative Agent the
amount so made available together with interest thereon in respect of each day
during the period commencing on the date such amount was so made available by
the Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to (i) in the case of payment by a
Lender, the Federal Funds Effective Rate for such day or (ii) in the case
of payment by the Borrower, the interest rate applicable to the relevant
Loan.  If such Lender so repays such
amount and interest thereon to the Administrative Agent within one Business Day
after such demand, all interest accruing on the Loan not funded by such Lender
during such period shall be payable to such Lender when received from the
Borrower.

 

2.20                                                   Replacement of
Lenders under Certain Circumstances.  The Borrower shall be permitted to replace
any Lender which (a) is not capable of receiving payments without any
deduction or withholding of United States federal income tax pursuant to Section 3.5,
or (b) cannot maintain its Fixed Rate Loans at a suitable Lending
Installation pursuant to Section 3.3, with a replacement bank or
other financial institution; provided that (i) such replacement
does not conflict with any applicable legal or regulatory requirements
affecting the Lenders, (ii) no Default or (after notice thereof to
Borrower) no Unmatured Default  shall
have occurred and be continuing at the time of such replacement, (iii) the
Borrower shall repay (or the replacement bank or institution shall purchase, at
par) all Loans and other amounts owing to such replaced Lender prior to the
date of replacement, (iv) the Borrower shall be liable to such replaced
Lender under Sections 3.4 and 3.6 if any Fixed Rate Loan
owing to such replaced Lender shall be prepaid (or purchased) other than on the
last day of the Interest Period relating thereto, (v) the replacement bank
or institution, if not already a Lender, and the terms and conditions of such
replacement, shall be reasonably satisfactory to the Administrative Agent, (vi) the
replaced Lender shall be obligated to make such replacement in accordance with
the provisions of Section 12.3 (provided that the Borrower shall be
obligated to pay the processing fee referred to therein), (vii) until such
time as such replacement shall be consummated, the Borrower shall pay all
additional amounts (if any) required pursuant to 

 

25

 

Section 3.5 and (viii) any
such replacement shall not be deemed to be a waiver of any rights which the
Borrower, the Administrative Agent or any other Lender shall have against the
replaced Lender.

 

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

 

ARTICLE IIA

LETTER
OF CREDIT SUBFACILITY

 

2A.1                       Obligation
to Issue. Subject to the terms and conditions of this Agreement and in
reliance upon the representations and warranties of the Borrower herein set
forth, the Issuing Bank hereby agrees to issue for the account of the Borrower,
one or more Facility Letters of Credit in accordance with this Article IIA,
from time to time during the period commencing on the Agreement Effective Date
and ending on a date sixty (60) days prior to the Facility Termination Date.

 

2A.2                       Types and Amounts. The Issuing Bank shall not:

 

(i)                                     issue any Facility Letter of
Credit if the aggregate maximum amount then available for drawing under Letters
of Credit issued by such Issuing Bank, after giving effect to the Facility
Letter of Credit requested hereunder, shall exceed any limit imposed by law or
regulation upon such Issuing Bank;

 

(ii)                                  issue any Facility Letter of
Credit if, after giving effect thereto, (1) the then applicable
Outstanding Facility Amount would exceed the then current Aggregate Commitment
or (2) the Facility Letter of Credit Obligations would exceed the Facility
Letter of Credit Sublimit; or

 

(iii)                               issue any Facility Letter of
Credit having an expiration date, or containing automatic extension provisions
to extend such date, to a date beyond the sixtieth (60th) day prior
to the Facility Termination Date.

 

2A.3                       Conditions. In addition to being subject to the satisfaction of
the conditions contained in Article IV hereof and in the balance of
this Article IIA, the obligation of the Issuing Bank to issue any
Facility Letter of Credit is subject to the satisfaction in full of the
following conditions:

 

26

 

(i)                                     the Borrower shall have
delivered to the Issuing Bank at such times and in such manner as the Issuing
Bank may reasonably prescribe such documents and materials as may be reasonably
required pursuant to the terms of the proposed Facility Letter of Credit (it
being understood that if any inconsistency exists between such documents and
the Loan Documents, the terms of the Loan Documents shall control) and the
proposed Facility Letter of Credit shall be reasonably satisfactory to the
Issuing Bank as to form and content;

 

(ii)                                  as of the date of issuance,
no order, judgment or decree of any court, arbitrator or governmental authority
shall purport by its terms to enjoin or restrain the Issuing Bank from issuing
the requested Facility Letter of Credit and no law, rule or regulation
applicable to the Issuing Bank and no request or directive (whether or not
having the force of law) from any governmental authority with jurisdiction over
the Issuing Bank shall prohibit or request that the Issuing Bank refrain from
the issuance of Letters of Credit generally or the issuance of the requested
Facility Letter or Credit in particular; and

 

(iii)                               there shall not exist any
Default or Unmatured Default.

 

2A.4                       Procedure for
Issuance of Facility Letters of Credit.

 

(a)                                  Borrower shall
give the Issuing Bank and the Administrative Agent at least three (3) Business
Days’ prior written notice of any requested issuance of a Facility Letter of
Credit under this Agreement (a “Letter of Credit Request”), such notice
shall be irrevocable, except as provided in Section 2A.4(b)(i) below,
and shall specify:

 

(1)                                  the stated amount of the Facility Letter of
Credit requested (which stated amount shall not be less than $50,000);

 

(2)                                  the effective date (which day shall be a
Business Day) of issuance of such requested Facility Letter of Credit (the “Issuance
Date”);

 

(3)                                  the date on which such requested Facility
Letter of Credit is to expire (which day shall be a Business Day which is not
less than sixty (60) days prior to the Facility Termination Date);

 

(4)                                  the purpose for which such Facility Letter of
Credit is to be issued;

 

(5)                                  the Person for whose benefit the requested
Facility Letter of Credit is to be issued; and

 

(6)                                  any special language required to be included
in the Facility Letter of Credit.

 

At the time such request is made, the Borrower shall
also provide the Administrative Agent and the Issuing Bank with a copy of the
form of the Facility Letter of Credit that the Borrower is requesting be issued
and shall execute and deliver the Issuing Bank’s customary letter of credit
application with respect thereto.  Such
notice, to be effective, must be received by such Issuing Bank and the
Administrative Agent not later than noon (Cleveland time) on the last Business
Day on which notice can be given under this Section 2A.4(a).

 

(b)                                 Subject to the
terms and conditions of this Article IIA and provided that the
applicable conditions set forth in Article IV hereof have been
satisfied, the Issuing Bank shall, on the Issuance Date, issue a Facility
Letter of Credit on behalf of the Borrower in accordance with the Letter of
Credit Request and the Issuing Bank’s usual and customary business practices
unless the Issuing Bank has actually received (i) written notice from the
Borrower specifically revoking the Letter of Credit Request with respect to
such Facility Letter of Credit given not later than the Business Day 

 

27

 

immediately preceding the Issuance Date, or (ii) written
or telephonic notice from the Administrative Agent stating that the issuance of
such Facility Letter of Credit would violate Section 2A.2.

 

(c)                                  The Issuing
Bank shall give the Administrative Agent (who shall promptly notify Lenders)
and the Borrower written or telex notice, or telephonic notice confirmed
promptly thereafter in writing, of the issuance of a Facility Letter of Credit
(the “Issuance Notice”).

 

(d)                                 The Issuing
Bank shall not extend or amend any Facility Letter of Credit unless the
requirements of this Section 2A.4 are met as though a new Facility
Letter of Credit was being requested and issued.

 

2A.5                       Reimbursement
Obligations; Duties of Issuing Bank.

 

(a)                                  The Issuing
Bank shall promptly notify the Borrower and the Administrative Agent (who shall
promptly notify Lenders) of any draw under a Facility Letter of Credit.  Any such draw shall not be deemed to be a
default hereunder but shall constitute an Advance of the Facility in the amount
of the Reimbursement Obligation with respect to such Facility Letter of Credit
and shall bear interest from the date of the relevant drawing(s) under the
pertinent Facility Letter of Credit at the Floating Rate Advance; provided that
if a Default or an Unmatured Default exists at the time of any such drawing(s),
then the Borrower shall reimburse the Issuing Bank for drawings under a
Facility Letter of Credit issued by the Issuing Bank no later than the next
succeeding Business Day after the payment by the Issuing Bank and until repaid
such Reimbursement Obligation shall bear interest at the Default Rate.

 

(b)                                 Any action
taken or omitted to be taken by the Issuing Bank under or in connection with
any Facility Letter of Credit, if taken or omitted in the absence of willful
misconduct or gross negligence, shall not put the Issuing Bank under any
resulting liability to any Lender or, provided that such Issuing Bank has
complied with the procedures specified in Section 2A.4, relieve any
Lender of its obligations hereunder to the Issuing Bank. In determining whether
to pay under any Facility Letter of Credit, the Issuing Bank shall have no
obligation relative to the Lenders other than to confirm that any documents
required to be delivered under such Letter of Credit appear to have been
delivered in compliance, and that they appear to comply on their face, with the
requirements of such Letter of Credit.

 

2A.6                       Participation.

 

(a)                                  Immediately
upon issuance by the Issuing Bank of any Facility Letter of Credit in
accordance with the procedures set forth in this Article IIA, each
Lender shall be deemed to have irrevocably and unconditionally purchased and
received from the Issuing Bank, without recourse, representation or warranty,
an undivided interest and participation equal to such Lender’s Percentage in
such Facility Letter of Credit (including, without limitation, all obligations
of the Borrower with respect thereto) and all related rights hereunder.  Each Lender’s obligation to make further
Loans to Borrower (other than any payments such Lender is required to make
under subparagraph (b) below) or to purchase an interest from the Issuing
Bank in any subsequent Facility Letters of Credit issued by the Issuing Bank on
behalf of Borrower shall be reduced by such Lender’s Percentage of the undrawn
portion of each Facility Letter of Credit outstanding.

 

(b)                                 In the event
that the Issuing Bank makes any payment under any Facility Letter of Credit and
the Borrower shall not have repaid such amount to the Issuing Bank pursuant to Section 2A.7
hereof, the Issuing Bank shall promptly notify the Administrative Agent, which
shall promptly notify each Lender of such failure, and each Lender shall
promptly and unconditionally pay to the Administrative Agent for the account of
the Issuing Bank the amount of such Lender’s Percentage of the 

 

28

 

unreimbursed amount of such payment, and the
Administrative Agent shall promptly pay such amount to the Issuing Bank.  Lender’s payments of its Percentage of such
Reimbursement Obligation as aforesaid shall be deemed to be a Loan by such
Lender and shall constitute outstanding principal under such Lender’s
Note.  The failure of any Lender to make
available to the Administrative Agent for the account of the Issuing Bank its
Percentage of the unreimbursed amount of any such payment shall not relieve any
other Lender of its obligation hereunder to make available to the
Administrative Agent for the account of such Issuing Bank its Percentage of the
unreimbursed amount of any payment on the date such payment is to be made, but
no Lender shall be responsible for the failure of any other Lender to make
available to the Administrative Agent its Percentage of the unreimbursed amount
of any payment on the date such payment is to be made.  Any Lender which fails to make any payment
required pursuant to this Section 2A.6(b) shall be deemed to
be a Defaulting Lender hereunder.

 

(c)                                  Whenever the
Issuing Bank receives a payment on account of a Reimbursement Obligation,
including any interest thereon, the Issuing Bank shall promptly pay to the
Administrative Agent and the Administrative Agent shall promptly (on the same
day as received by the Administrative Agent if received prior to noon
(Cleveland time) on such day and otherwise on the next Business Day) pay to each
Lender which has funded its participating interest therein, in immediately
available funds, an amount equal to such Lender’s Percentage thereof.

 

(d)                                 Upon the
request of the Administrative Agent or any Lender, the Issuing Bank shall
furnish to such Administrative Agent or Lender copies of any Facility Letter of
Credit to which the Issuing Bank is party and such other documentation as may
reasonably be requested by the Administrative Agent or Lender.

 

(e)                                  The obligations
of a Lender to make payments to the Administrative Agent for the account of the
Issuing Bank with respect to a Facility Letter of Credit shall be absolute,
unconditional and irrevocable, not subject to any counterclaim, set-off,
qualification or exception whatsoever other than a failure of any such Issuing
Bank to comply with the terms of this Agreement relating to the issuance of
such Facility Letter of Credit, and such payments shall be made in accordance
with the terms and conditions of this Agreement under all circumstances.

 

2A.7                       Payment of
Reimbursement Obligations.

 

(a)                                  The Borrower
agrees to pay to the Administrative Agent for the account of the Issuing Bank
the amount of all Advances for Reimbursement Obligations, interest and other
amounts payable to the Issuing Bank under or in connection with any Facility
Letter of Credit when due, irrespective of any claim, set-off, defense or other
right which the Borrower may have at any time against any Issuing Bank or any
other Person, under all circumstances, including without limitation any of the
following circumstances:

 

(i)                                     any lack of validity or
enforceability of this Agreement or any of the other Loan Documents;

 

(ii)                                  the existence of any claim,
setoff, defense or other right which the Borrower may have at any time against
a beneficiary named in a Facility Letter of Credit or any transferee of any
Facility Letter of Credit (or any Person for whom any such transferee may be
acting), the Administrative Agent, the Issuing Bank, any Lender, or any other
Person, whether in connection with this Agreement, any Facility Letter of
Credit, the transactions contemplated herein or any unrelated transactions
(including any underlying transactions between the Borrower and the beneficiary
named in any Facility Letter of Credit);

 

29

 

(iii)                               any draft, certificate or
any other document presented under the Facility Letter of Credit proving to be
forged, fraudulent, invalid or insufficient in any respect of any statement
therein being untrue or inaccurate in any respect;

 

(iv)                              the surrender or impairment
of any security for the performance or observance of any of the terms of any of
the Loan Documents; or

 

(v)                                 the occurrence of any
Default or Unmatured Default.

 

(b)                                 In the event
any payment by the Borrower received by the Issuing Bank or the Administrative
Agent with respect to a Facility Letter of Credit and distributed by the
Administrative Agent to the Lenders on account of their participations is
thereafter set aside, avoided or recovered from the Administrative Agent or
Issuing Bank in connection with any receivership, liquidation, reorganization
or bankruptcy proceeding, each Lender which received such distribution shall,
upon demand by the Administrative Agent, contribute such Lender’s Percentage of
the amount set aside, avoided or recovered together with interest at the rate
required to be paid by the Issuing Bank or the Administrative Agent upon the
amount required to be repaid by the Issuing Bank or the Administrative Agent.

 

2A.8                       Compensation
for Facility Letters of Credit.

 

(a)                                  The Borrower
shall pay to the Administrative Agent, for the ratable account of the Lenders
(including the Issuing Bank), based upon the Lenders’ respective Percentages, a
per annum fee (the “Facility Letter of Credit Fee”) as a percentage of
the face amount of each Facility Letter of Credit outstanding equal to the
LIBOR Applicable Margin in effect from time to time hereunder while such
Facility Letter of Credit is outstanding. 
The Facility Letter of Credit Fee relating to any Facility Letter of
Credit shall accrue on a daily basis and shall be due and payable in arrears on
the first Business Day of each calendar quarter following the issuance of such
Facility Letter of Credit and, to the extent any such fees are then due and
unpaid, on the Facility Termination Date or any other earlier date that the
Obligations are due and payable in full. 
The Administrative Agent shall promptly (on the same day as received by
the Administrative Agent if received prior to noon (Cleveland time) on such day
and otherwise on the next Business Day) 
remit such Facility Letter of Credit Fees, when paid, to the other
Lenders in accordance with their Percentages thereof.  The Borrower shall not have any liability to
any Lender for the failure of the Administrative Agent to promptly deliver
funds to any such Lender and shall be deemed to have made all such payments on
the date the respective payment is made by the Borrower to the Administrative
Agent, provided such payment is received by the time specified in Section 2.13
hereof.

 

(b)                                 The Issuing
Bank also shall have the right to receive solely for its own account an
issuance fee equal to the greater of (A) $1,500 or (B) one-eighth of
one percent (0.125%) per annum to be calculated on the face amount of each
Facility Letter of Credit for the stated duration thereof, based on the actual
number of days and using a 360-day year basis. 
The issuance fee shall be payable by the Borrower on the Issuance Date
for each such Facility Letter of Credit and on the date of any increase therein
or extension thereof.  The Issuing Bank
shall also be entitled to receive its reasonable out-of-pocket costs and the
Issuing Bank’s standard charges of issuing, amending and servicing Facility
Letters of Credit and processing draws thereunder.

 

2A.9                       Letter of Credit Collateral Account. 
The Borrower hereby agrees that it will immediately upon the request of
the Administrative Agent, establish a special collateral account (the “Letter
of Credit Collateral Account”) at the Administrative Agent’s office at the
address specified pursuant to Article XIII, in the name of the
Borrower but under the sole dominion and control of the 

 

30

 

Administrative Agent, for the benefit of the Lenders,
and in which the Borrower shall have no interest other than as set forth in Section 8.1.  The Letter of Credit Collateral Account shall
hold the deposits the Borrower is required to make after a Default on account
of any outstanding Facility Letters of Credit as described in Section 8.1.  In addition to the foregoing, the Borrower
hereby grants to the Administrative Agent, for the benefit of the Lenders, a
security interest in and to the Letter of Credit Collateral Account and any
funds that may hereafter be on deposit in such account, including income earned
thereon.  The Lenders acknowledge and
agree that the Borrower has no obligation to fund the Letter of Credit
Collateral Account unless and until so required under Section 8.1
hereof.

 

ARTICLE III

 

CHANGE IN CIRCUMSTANCES

 

3.1         Yield Protection.  If, on or after the date of this Agreement,
the adoption of any law or any governmental or quasi-governmental rule,
regulation, policy, guideline or directive (whether or not having the force of
law), or any change in the interpretation or administration thereof by any
governmental or quasi-governmental authority, central bank or comparable agency
charged with the interpretation or administration thereof, or compliance by any
Lender or applicable Lending Installation with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency:

 

(i)                                     subjects any
Lender or any applicable Lending Installation to any Taxes, or changes the
basis of taxation of payments (other than with respect to Excluded Taxes) to
any Lender in respect of its LIBOR Loans, or

 

(ii)                                  imposes or
increases or deems applicable any reserve, assessment, insurance charge,
special deposit or similar requirement against assets of, deposits with or for
the account of, or credit extended by, any Lender or any applicable Lending
Installation (other than reserves and assessments taken into account in
determining the interest rate applicable to Fixed Rate Advances), or

 

(iii)                               imposes any
other condition the result of which is to increase the cost to any Lender or
any applicable Lending Installation of making, funding or maintaining its Fixed
Rate Loans, or reduces any amount receivable by any Lender or any applicable
Lending Installation  in connection with
its Fixed Rate Loans, or requires any Lender or any applicable Lending
Installation to make any payment calculated by reference to the amount of Fixed
Rate Loans, by an amount deemed material by such Lender  as the case may be,

 

and the result of any of the foregoing is to increase
the cost to such Lender or applicable Lending Installation, as the case may be,
of making or maintaining its Fixed Rate Loans or Commitment or to reduce the
return received by such Lender or applicable Lending Installation in connection
with such Fixed Rate Loans or Commitment, then, within 15 days of demand by
such Lender or the Borrower shall pay such Lender such additional amount or
amounts as will compensate such Lender for such increased cost or reduction in
amount received.

 

3.2         Changes in Capital Adequacy
Regulations.  If a Lender
in good faith determines the amount of capital required or expected to be
maintained by such Lender, any Lending Installation of such Lender or any
corporation controlling such Lender  is
increased as a result of a Change (as hereinafter defined), then, within 15
days of demand by such Lender, the Borrower shall pay such Lender the amount
necessary to compensate for any shortfall in the rate of return on the portion
of 

 

31

 

such increased capital which such Lender in
good faith determines is attributable to this Agreement, its outstanding credit
exposure hereunder or its obligation to make Loans hereunder (after taking into
account such Lender’s policies as to capital adequacy).  “Change” means (i) any change
after the date of this Agreement in the Risk-Based Capital Guidelines (as
hereinafter defined) or (ii) any adoption of or change in any other law,
governmental or quasi-governmental rule, regulation, policy, guideline, interpretation,
or directive (whether or not having the force of law) after the date of this
Agreement which affects the amount of capital required or expected to be
maintained by any Lender or any Lending Installation or any corporation
controlling any Lender.  “Risk-Based
Capital Guidelines” means (i) the risk-based capital guidelines in
effect in the United States on the date of this Agreement, including transition
rules, and (ii) the corresponding capital regulations promulgated by
regulatory authorities outside the United States implementing the July 1988
report of the Basle Committee on Banking Regulation and Supervisory Practices
Entitled “International Convergence of Capital Measurements and Capital
Standards,” including transition rules, and any amendments to such regulations
adopted prior to the date of this Agreement.

 

3.3         Availability of Types of
Advances.  If any
Lender in good faith determines that maintenance of any of its Fixed Rate Loans
at a suitable Lending Installation would violate any applicable law, rule,
regulation or directive, whether or not having the force of law, the
Administrative Agent shall, with written notice to Borrower, suspend the
availability of the affected Type of Advance and require any Fixed Rate
Advances of the affected Type to be repaid; or if the Required Lenders in good
faith determine that (i) deposits of a type or maturity appropriate to
match fund Fixed Rate Advances are not available, the Administrative Agent
shall, with written notice to Borrower, suspend the availability of the
affected Type of Advance with respect to any Fixed Rate Advances made after the
date of any such determination, or (ii) an interest rate applicable to a
Type of Advance does not accurately reflect the cost of making a Fixed Rate
Advance of such Type, then, if for any reason whatsoever the provisions of Section 3.1
are inapplicable, the Administrative Agent shall, with written notice to
Borrower, suspend the availability of the affected Type of Advance with respect
to any Fixed Rate Advances made after the date of any such determination.  If the Borrower is required to so repay a
Fixed Rate Advance, the Borrower may concurrently with such repayment borrow
from the Lenders, in the amount of such repayment, a Loan bearing interest at
the Alternate Base Rate.

 

3.4         Funding Indemnification.  If any payment of a ratable Fixed Rate
Advance occurs on a date which is not the last day of the applicable Interest
Period, whether because of acceleration, prepayment or otherwise, or a ratable
Fixed Rate Advance is not made on the date specified by the Borrower for any
reason other than default by the Lenders or as a result of unavailability
pursuant to Section 3.3, the Borrower will indemnify each Lender
for any loss or cost incurred by it resulting therefrom, including, without
limitation, any loss or cost (incurred or expected to be incurred) in
liquidating or employing deposits acquired to fund or maintain the ratable
Fixed Rate Advance and shall pay all such losses or costs within fifteen (15)
days after written demand therefor.

 

3.5         Taxes.

 

(i)                                     All payments by
the Borrower to or for the account of any Lender or the Administrative Agent
hereunder or under any Note shall be made free and clear of and without
deduction for any and all Taxes.  If the
Borrower shall be required by law to deduct any Taxes from or in respect of any
sum payable hereunder to any Lender or the Administrative Agent, (a) 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 3.5) such Lender or the Administrative Agent (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions been made, (b) the Borrower shall make such deductions, 

 

32

 

(c) the Borrower shall pay the full
amount deducted to the relevant authority in accordance with applicable law and
(d) the Borrower shall furnish to the Administrative Agent the original
copy of a receipt evidencing payment thereof within 30 days after such payment
is made.

 

(ii)                                  In addition,
the Borrower hereby agrees to pay any present or future stamp or documentary
taxes and any other excise or property taxes, charges or similar levies which
arise from any payment made hereunder or under any Note or from the execution
or delivery of, or otherwise with respect to, this Agreement or any Note (“Other
Taxes”).

 

(iii)                               The Borrower
hereby agrees to indemnify the Administrative Agent and each Lender for the
full amount of Taxes or Other Taxes (including, without limitation, any Taxes
or Other Taxes imposed on amounts payable under this Section 3.5)
paid by the Administrative Agent or such Lender and any liability (including
penalties, interest and expenses) arising therefrom or with respect
thereto.  Payments due under this
indemnification shall be made within 30 days of the date the Administrative
Agent or such Lender makes demand therefor pursuant to Section 3.6.

 

(iv)                              Each Lender
that is not incorporated under the laws of the United States of America or a
state thereof (each a “Non-U.S. Lender”) agrees that it will, not more than ten
Business Days after the date of this Agreement, (i) deliver to each of the
Borrower and the Administrative Agent two duly completed copies of United
States Internal Revenue Service Form W-8BEN or W-8ECI, certifying in
either case that such Lender is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal income
taxes, and (ii) deliver to each of the Borrower and the Administrative
Agent a United States Internal Revenue Form W-8 or W-9, as the case may
be, and certify that it is entitled to an exemption from United States backup
withholding tax.  Each Non-U.S. Lender
further undertakes to deliver to each of the Borrower and the Administrative
Agent (x) renewals or additional copies of such form (or any successor
form) on or before the date that such form expires or becomes obsolete, and (y) after
the occurrence of any event requiring a change in the most recent forms so
delivered by it, such additional forms or amendments thereto as may be
reasonably requested by the Borrower or the Administrative Agent.  All forms or amendments described in the
preceding sentence shall certify that such Lender is entitled to receive
payments under this Agreement without deduction or withholding of any United
States federal income taxes, unless an event
(including without limitation any change in treaty, law or regulation) has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form or amendment with
respect to it and such Lender advises the Borrower and the Administrative Agent
that it is not capable of receiving payments without any deduction or
withholding of United States federal income tax.

 

(v)                                 For any period
during which a Non-U.S. Lender has failed to provide the Borrower with an
appropriate form pursuant to clause (iv), above (unless such failure is due to
a change in treaty, law or regulation, or any change in the interpretation or
administration thereof by any governmental authority, occurring subsequent to
the date on which a form originally was required to be provided), such Non-U.S.
Lender shall not be entitled to indemnification under this Section 3.5
with respect to Taxes imposed by the United States.

 

(vi)                              Any Lender that
is entitled to an exemption from or reduction of withholding tax with respect
to payments under this Agreement or any Note pursuant to the law of any
relevant jurisdiction or any treaty shall deliver to the Borrower (with a copy
to the Administrative Agent), at the time or times prescribed by applicable
law, such properly completed and executed 

 

33

 

documentation prescribed by applicable law as
will permit such payments to be made without withholding or at a reduced rate
following receipt of such documentation.

 

(vii)                           If the U.S.
Internal Revenue Service or any other governmental authority of the United
States or any other country or any political subdivision thereof asserts a
claim that the Administrative Agent did not properly withhold tax from amounts
paid to or for the account of any Lender (because the appropriate form was not
delivered or properly completed, because such Lender failed to notify the
Administrative Agent of a change in circumstances which rendered its exemption
from withholding ineffective, or for any other reason), such Lender shall
indemnify the Administrative Agent fully for all amounts paid, directly or
indirectly, by the Administrative Agent as tax, withholding therefor, or
otherwise, including penalties and interest, and including taxes imposed by any
jurisdiction on amounts payable to the Administrative Agent under this
subsection, together with all costs and expenses related thereto (including
attorneys fees and time charges of attorneys for the Administrative Agent,
which attorneys may be employees of the Administrative Agent).  The obligations of the Lenders under this Section 3.5(vii) shall
survive the payment of the Obligations and termination of this Agreement and
any such Lender obligated to indemnify the Administrative Agent shall not be
entitled to indemnification from the Borrower with respect to such amounts,
whether pursuant to this Article or otherwise, except to the extent
the Borrower participated in the actions giving rise to such liability.

 

3.6         Lender Statements; Survival
of Indemnity.  To the
extent reasonably possible, each Lender shall designate an alternate Lending
Installation with respect to its Fixed Rate Loans to reduce any liability of
the Borrower to such Lender under Sections 3.1, 3.2 and 3.5 or to avoid
the unavailability of Fixed Rate Advances under Section 3.3, so
long as such designation is not, in the reasonable judgment of such Lender,
disadvantageous to such Lender.  Each
Lender shall deliver a written statement of such Lender to the Borrower (with a
copy to the Administrative Agent) as to the amount due, if any, under Sections
3.1, 3.2, 3.4 or 3.5.  Such written
statement shall set forth in reasonable detail the calculations upon which such
Lender determined such amount and shall be final, conclusive and binding on the
Borrower in the absence of manifest error. 
Determination of amounts payable under such Sections in connection with
a Fixed Rate Loan shall be calculated as though each Lender funded its Fixed
Rate Loan through the purchase of a deposit of the type and maturity
corresponding to the deposit used as a reference in determining the Fixed Rate
applicable to such Loan, whether in fact that is the case or not.  Unless otherwise provided herein, the amount
specified in the written statement of any Lender shall be payable on demand
after receipt by the Borrower of such written statement.  The obligations of the Borrower under Sections
3.1, 3.2, 3.4  and 3.5 shall survive payment of the Obligations and
termination of this Agreement.

 

ARTICLE IV

 

CONDITIONS PRECEDENT

 

4.1         Initial Advance.  The Lenders shall not be required to make the
initial Advance hereunder or issue the initial Facility Letter of Credit
hereunder, unless (a) the Borrower shall, prior to or concurrently with
such initial Advance, have paid all fees due and payable to the Lenders and the
Administrative Agent hereunder, and (b) the Borrower shall have furnished
to the Administrative Agent, with sufficient copies for the Lenders, the
following:

 

(i)                                     The duly
executed originals of the Loan Documents, including the Notes, payable to the
order of each of the Lenders, this Agreement and the Subsidiary Guaranty;

 

34

 

(ii)                                  (A) Certificates
of good standing for the Borrower and each Subsidiary Guarantor, from the State
of Maryland for the Borrower and the states of organization of each Subsidiary
Guarantor, certified by the appropriate governmental officer and dated not more
than thirty (30) days prior to the Agreement Execution Date, and (B) foreign
qualification certificates for the Borrower and each Subsidiary Guarantor,
certified by the appropriate governmental officer and dated not more than
thirty (30) days prior to the Agreement Execution Date, for each other
jurisdiction where the failure of the Borrower or such Subsidiary Guarantor to
so qualify or be licensed (if required) would have a Material Adverse Effect;

 

(iii)                               Copies of the
formation documents (including code of regulations, if appropriate) of the
Borrower and the Subsidiary Guarantors, certified by an officer of the Borrower
or such Subsidiary Guarantor, as appropriate, together with all amendments
thereto;

 

(iv)                              Incumbency
certificates, executed by officers of the Borrower and the Subsidiary
Guarantors, which shall identify by name and title and bear the signature of
the Persons authorized to sign the Loan Documents and to make borrowings
hereunder on behalf of the Borrower, upon which certificate the Administrative
Agent and the Lenders shall be entitled to rely until informed of any change in
writing by the Borrower or any such Subsidiary Guarantor;

 

(v)                                 Copies,
certified by a Secretary or an Assistant Secretary of the Borrower and each
Subsidiary Guarantor, of the Board of Directors’ resolutions (and resolutions
of other bodies, if any are reasonably deemed necessary by counsel for any
Lender) authorizing the Advances provided for herein, with respect to the
Borrower, and the execution, delivery and performance of the Loan Documents to
be executed and delivered by the Borrower and each Subsidiary Guarantor
hereunder;

 

(vi)                              A written
opinion of the Borrower’s and Subsidiary Guarantors’ counsel, addressed to the
Lenders in substantially the form of Exhibit H hereto or such other
form as the Administrative Agent may reasonably approve;

 

(vii)                           A certificate,
signed by an officer of the Borrower, stating that on the initial Borrowing
Date no Default or Unmatured Default has occurred and is continuing and that
all representations and warranties of the Borrower are true and correct as of
the initial Borrowing Date provided that such certificate is in fact true and
correct;

 

(viii)                        The most recent
financial statements of the Borrower;

 

(ix)                                UCC financing
statement, judgment, and tax lien searches with respect to the Borrower from
its state of organization and principal place of business;

 

(x)                                   Written money
transfer instructions, in substantially the form of Exhibit E
hereto, addressed to the Administrative Agent and signed by an Authorized
Officer, together with such other related money transfer authorizations as the
Administrative Agent may have reasonably requested;

 

(xi)                                A fully
executed copy of the Fee Letter dated
                              
between the Borrower and the Administrative Agent and the Syndication Agent;

 

(xii)                             Evidence that
all upfront fees due to each of the Lenders under the terms of their respective
commitment letters have been paid, or will be paid out of the proceeds of the
initial Advance hereunder;

 

35

 

(xiii)                        A compliance
certificate pursuant to Section 6.1(v);

 

(xiv)                         A certificate,
in substantially the form of Exhibit J attached hereto, signed by
an officer of the Borrower, certifying the Aggregate Pool Value; and

 

(xv)                            Such other
documents as any Lender or its counsel may have reasonably requested, the form
and substance of which documents shall be reasonably acceptable to the parties
and their respective counsel.

 

4.2         Each Advance and Issuance.  The Lenders shall not be required to make any
Advance or issue any Facility Letter of Credit unless on the applicable
Borrowing Date:

 

(i)                                     There exists no
Default or Unmatured Default;

 

(ii)                                  The
representations and warranties contained in Article V are true and
correct as of such Borrowing Date with respect to Borrower and to any
Subsidiary in existence on such Borrowing Date, except to the extent any such
representation or warranty is stated to relate solely to an earlier date, in
which case such representation or warranty shall be true and correct on and as
of such earlier date;

 

(iii)                               At any time
through and including the Unencumbered Trigger Date, the Borrower has furnished
the Administrative Agent with the certificate required under Section 4.1(xiv)
certifying the then-current Aggregate Pool Value;  and

 

(iv)                              All legal
matters incident to the making of such Advance or issuance of such Facility
Letter of Credit shall be satisfactory to the Lenders and their counsel.

 

Each Borrowing Notice and each Letter of Credit
Request with respect to each such Advance shall constitute a representation and
warranty by the Borrower that the conditions contained in Sections 4.2(i) and
(ii) have been satisfied.

 

ARTICLE
V

 

REPRESENTATIONS AND WARRANTIES

 

The Borrower represents and warrants to the Lenders
that:

 

5.1         Existence.  Borrower is a corporation duly organized and
validly existing under the laws of the State of Maryland, with its principal
place of business in Oak Brook, Illinois and is duly qualified as a foreign
corporation, properly licensed (if required), in good standing and has all
requisite authority to conduct its business in each jurisdiction in which its
business is conducted, except where the failure to be so qualified, licensed
and in good standing and to have the requisite authority would not have a
Material Adverse Effect.  Each of Borrower’s
Subsidiaries is duly incorporated, validly existing and in good standing under
the laws of its jurisdiction of incorporation and has all requisite authority
to conduct its business in each jurisdiction in which its business is
conducted.

 

5.2         Authorization and Validity.  The Borrower has the corporate power and
authority and legal right to execute and deliver the Loan Documents and to
perform its obligations thereunder.  The
execution and delivery by the Borrower of the Loan Documents and the performance
of its obligations thereunder have been duly authorized by proper corporate
proceedings, and the Loan 

 

36

 

Documents constitute legal, valid and binding
obligations of the Borrower enforceable against the Borrower in accordance with
their terms, except as enforceability may be limited by bankruptcy, insolvency
or similar laws affecting the enforcement of creditors’ rights generally.

 

5.3         No Conflict; Government
Consent.  Neither the execution and
delivery by the Borrower of the Loan Documents, nor the consummation of the
transactions therein contemplated, nor compliance with the provisions thereof
will violate any law, rule, regulation, order, writ, judgment, injunction,
decree or award binding on the Borrower or any of its Subsidiaries or the
Borrower’s or any Subsidiary’s articles of incorporation or by-laws, or the
provisions of any indenture, instrument or agreement to which the Borrower or
any of its Subsidiaries is a party or is subject, or by which it, or its
Property, is bound, or conflict with or constitute a default thereunder, except
where such violation, conflict or default would not have a Material Adverse
Effect, or result in the creation or imposition of any Lien in, of or on the
Property of the Borrower or a Subsidiary pursuant to the terms of any such
indenture, instrument or agreement.  No
order, consent, approval, license, authorization, or validation of, or filing,
recording or registration with, or exemption by, any governmental or public body
or authority, or any subdivision thereof, is required to authorize, or is
required in connection with the execution, delivery and performance of, or the
legality, validity, binding effect or enforceability of, any of the Loan
Documents other than the filing of a copy of this Agreement.

 

5.4         Financial Statements;
Material Adverse Effect.  All
consolidated financial statements of the Borrower and its Subsidiaries
heretofore or hereafter delivered to the Lenders were prepared in accordance
with GAAP in effect on the preparation date of such statements and fairly
present in all material respects the consolidated financial condition and
operations of the Borrower and its Subsidiaries at such date and the
consolidated results of their operations for the period then ended, subject, in
the case of interim financial statements, to normal and customary year-end
adjustments.  From the preparation date
of the most recent financial statements delivered to the Lenders through the
Agreement Execution Date, there was no change in the business, properties, or
condition (financial or otherwise) of the Borrower and its Subsidiaries which
could reasonably be expected to have a Material Adverse Effect.

 

5.5         Taxes.  The Borrower and its Subsidiaries have filed
all United States federal tax returns and all other tax returns which are
required to be filed and have paid all taxes due pursuant to said returns or
pursuant to any assessment received by the Borrower or any of its Subsidiaries
except such taxes, if any, as are being contested in good faith and as to which
adequate reserves have been provided.  No
tax liens have been filed and no claims are being asserted with respect to such
taxes.  The charges, accruals and
reserves on the books of the Borrower and its Subsidiaries in respect of any
taxes or other governmental charges are adequate.

 

5.6         Litigation and Guarantee
Obligations.  Except as
set forth on Schedule 3 hereto or as set forth in written notice to the
Administrative Agent from time to time, there is no litigation, arbitration,
governmental investigation, proceeding or inquiry pending or, to the knowledge
of any of their officers, threatened against or affecting the Borrower or any
of its Subsidiaries which could reasonably be expected to have a Material
Adverse Effect.  The Borrower has no
material contingent obligations not provided for or disclosed in the financial
statements referred to in Section 6.1 or as set forth in written
notices to the Administrative Agent given from time to time after the Agreement
Execution Date on or about the date such material contingent obligations are
incurred.

 

5.7                                                         Subsidiaries;
Investment Affiliates.  Schedule
1 hereto contains, an accurate list of all Subsidiaries of the Borrower,
setting forth their respective jurisdictions of incorporation or formation and
the percentage of their respective capital stock or partnership or membership
interest 

 

37

 

owned by the Borrower or
other Subsidiaries.  All of the issued
and outstanding shares of capital stock of such Subsidiaries that are
corporations have been duly authorized and issued and are fully paid and
non-assessable. There are no outstanding subscriptions, options, warrants,
commitments, preemptive rights or agreements of any kind (including, without
limitation, any stockholders’ or voting trust agreements) for the issuance,
sale, registration or voting of, or outstanding securities convertible into,
any additional shares of capital stock of any class, or partnership or other
ownership interests of any type in, any such Subsidiary. Schedule 6  hereto contains an accurate list of all
Investment Affiliates of Borrower, including the correct legal name of such
Investment Affiliate, the type of legal entity which each such Investment
Affiliate is, and the type and amount of all equity interests in such
Investment Affiliate held directly or indirectly by Borrower.

 

5.8                                               ERISA.  The Unfunded Liabilities of all Single
Employer Plans do not in the aggregate exceed $1,000,000.  Neither the Borrower nor any other member of
the Controlled Group has incurred, or is reasonably expected to incur, any
withdrawal liability to Multiemployer Plans in excess of $250,000 in the
aggregate.  Each Plan complies in all
material respects with all applicable requirements of law and regulations, no
Reportable Event has occurred with respect to any Plan, neither the Borrower
nor any other members of the Controlled Group has withdrawn from any Plan or
initiated steps to do so, and no steps have been taken to reorganize or
terminate any Plan.

 

5.9                                                         Accuracy of
Information.  No
information, exhibit or report furnished by the Borrower or any of its
Subsidiaries to the Administrative Agent or to any Lender in connection with
the negotiation of, or compliance with, the Loan Documents contained any
material misstatement of fact or omitted to state a material fact or any fact
necessary to make the statements contained therein not misleading.

 

5.10                                                   Regulation U.  The Borrower has not used the proceeds of any
Advance to buy or carry any margin stock (as defined in Regulation U) in
violation of the terms of this Agreement.

 

5.11                                                   Material
Agreements.  Neither the
Borrower nor any Subsidiary is a party to any agreement or instrument or
subject to any charter or other corporate restriction which could reasonably be
expected to have a Material Adverse Effect. 
Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (i) any agreement to which it is a party, which
default could have a Material Adverse Effect, or (ii) any agreement or
instrument evidencing or governing Indebtedness, which default would constitute
a Default hereunder.

 

5.12                                                   Compliance With
Laws.  The Borrower and its Subsidiaries
have complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof, having jurisdiction over the conduct of their respective
businesses or the ownership of their respective Property, except for any
non-compliance which would not have a Material Adverse Effect.  Neither the Borrower nor any Subsidiary has
received any notice to the effect that its operations are not in material
compliance with any of the requirements of applicable federal, state and local
environmental, health and safety statutes and regulations or the subject of any
federal or state investigation evaluating whether any remedial action is needed
to respond to a release of any toxic or hazardous waste or substance into the
environment, which non-compliance or remedial action could have a Material
Adverse Effect.

 

5.13                                                   Ownership of
Properties.  Except as
set forth on Schedule 2 hereto, on the date of this Agreement, the
Borrower and its Subsidiaries will have good and marketable title, free of all
Liens other than those permitted by Section 6.16, to all of the
Property and assets reflected in the financial statements as owned by it.

 

38

 

5.14                                                   Investment
Company Act.  Neither the
Borrower nor any Subsidiary is an “investment company” or a company “controlled”
by an “investment company”, within the meaning of the Investment Company Act of
1940, as amended.

 

5.15                                                   Affiliate
Transactions. Except as permitted by Section 6.17,  neither the Borrower, nor any of its
Subsidiaries is a party to or bound by any agreement or arrangement (whether
oral or written) to which any Affiliate of Borrower or any of its Subsidiaries
is a party.

 

5.16                                                   Solvency.

 

(i)                                     Immediately
after the Agreement Execution Date and immediately following the making of each
Loan and after giving effect to the application of the proceeds of such Loans, (a) the
fair value of the assets of the Borrower and its Subsidiaries on a consolidated
basis, at a fair valuation, will exceed the debts and liabilities,
subordinated, contingent or otherwise, of the Borrower and its Subsidiaries on
a consolidated basis; (b) the present fair saleable value of the Property
of the Borrower and its Subsidiaries on a consolidated basis will be greater
than the amount that will be required to pay the probable liability of the
Borrower and its Subsidiaries on a consolidated basis on their debts and other
liabilities, subordinated, contingent or otherwise, as such debts and other
liabilities become absolute and matured; (c) the Borrower and its
Subsidiaries on a consolidated basis will be able to pay their debts and
liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured; and (d) the Borrower and its
Subsidiaries on a consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted after the date
hereof.

 

(ii)                                  The Borrower
does not intend to, or to permit any of its Subsidiaries to, and does not
believe that it or any of its Subsidiaries will, incur debts beyond its ability
to pay such debts as they mature, taking into account the timing of and amounts
of cash to be received by it or any such Subsidiary and the timing of the
amounts of cash to be payable on or in respect of its Indebtedness or the
Indebtedness of any such Subsidiary.

 

5.17                                                   Insurance  The Borrower and its Subsidiaries carry
insurance on their Projects with financially sound and reputable insurance
companies, in such amounts, with such deductibles and covering such risks as
are customarily carried by companies engaged in similar businesses and owning
similar Projects in localities where the Borrower and its Subsidiaries operate,
including, without limitation:

 

(i)                                     Property and
casualty insurance (including coverage for flood and other water damage for any
Project located within a 100-year flood plain) in the amount of the replacement
cost of the improvements at the Project (to the extent replacement cost
insurance is maintained by companies engaged in similar business and owning
similar properties);

 

(ii)                                  Builder’s risk
insurance for any Project under construction in the amount of the construction
cost of such Project;

 

(iii)                               Loss of rental
income insurance in the amount not less than one year’s gross revenues from the
Projects; and

 

(iv)                              Comprehensive
general liability insurance in the amount of $20,000,000 per occurrence.

 

39

 

5.18                                                   REIT Status.  The Borrower is qualified as a real estate
investment trust under Section 856 of the Code and currently is in
compliance in all material respects with all provisions of the Code applicable
to the qualification of the Borrower as a real estate investment trust.

 

5.19                                                   Environmental
Matters.  Each of the following
representations and warranties is true and correct on and as of the Agreement
Execution Date except as disclosed on Schedule 4 attached hereto and to
the extent that the facts and circumstances giving rise to any such failure to
be so true and correct, in the aggregate, could not reasonably be expected to
have a Material Adverse Effect:

 

(a)                                        To the best knowledge of the Borrower,
the Projects of the Borrower and its Subsidiaries do not contain any Materials
of Environmental Concern in amounts or concentrations which constitute a
violation of, or could reasonably give rise to liability of the Borrower or any
Subsidiary under, Environmental Laws.

 

(b)                                       To the best knowledge of the Borrower, (i) the
Projects of the Borrower and its Subsidiaries and all operations at the
Projects are in compliance with all applicable Environmental Laws, and (ii) with
respect to all Projects owned by the Borrower and/or its Subsidiaries (x) for
at least two (2) years, have in the last two years, or (y) for less
than two (2) years, have for such period of ownership, been in compliance
in all material respects with all applicable Environmental Laws.

 

(c)                                        Neither the Borrower nor any of its
Subsidiaries has received any notice of violation, alleged violation,
non-compliance, liability or potential liability regarding environmental
matters or compliance with Environmental Laws with regard to any of the
Projects, nor does the Borrower have knowledge or reason to believe that any
such notice will be received or is being threatened.

 

(d)                                       To the best knowledge of the Borrower,
Materials of Environmental Concern have not been transported or disposed of
from the Projects of the Borrower and its Subsidiaries in violation of, or in a
manner or to a location which could reasonably give rise to liability of the
Borrower or any Subsidiary under, Environmental Laws, nor have any Materials of
Environmental Concern been generated, treated, stored or disposed of at, on or
under any of the Projects of the Borrower and its Subsidiaries in violation of,
or in a manner that could give rise to liability of the Borrower or any
Subsidiary under, any applicable Environmental Laws.

 

(e)                                        No judicial proceedings or governmental
or administrative action is pending, or, to the knowledge of the Borrower,
threatened, under any Environmental Law to which the Borrower or any of its
Subsidiaries is or, to the Borrower’s knowledge, will be named as a party with
respect to the Projects 

 

40

 

of the Borrower and its Subsidiaries, nor are there any consent decrees
or other decrees, consent orders, administrative order or other orders, or
other administrative of judicial requirements outstanding under any
Environmental Law with respect to the Projects of the Borrower and its
Subsidiaries.

 

(f)                                          To the best knowledge of the Borrower,
there has been no release or threat of release of Materials of Environmental
Concern at or from the Projects of the Borrower and its Subsidiaries, or
arising from or related to the operations of the Borrower and its Subsidiaries
in connection with the Projects in violation of or in amounts or in a manner
that could give rise to liability under Environmental Laws.

 

5.20                                                   Intellectual
Property.

 

(i) Borrower and
each of its Subsidiaries owns or has the right to use, under valid license
agreements or otherwise, all material patents, licenses, franchises,
trademarks, trademark rights, trade names, trade name rights, trade secrets and
copyrights (collectively, “Intellectual Property”) used in the conduct of their
respective businesses as now conducted and as contemplated by the Loan
Documents, without known conflict with any patent, license, franchise,
trademark, trade secret, trade name, copyright, or other proprietary right of
any other Person.

 

(ii) Borrower and
each of its Subsidiaries have taken all such steps as they deem reasonably
necessary to protect their respective rights under and with respect to such
Intellectual Property.

 

(iii) No claim has
been asserted by any Person with respect to the use of any Intellectual
Property by Borrower or any of its Subsidiaries, or challenging or questioning
the validity or effectiveness of any Intellectual Property.

 

(iv) The use of such
Intellectual Property by Borrower and each of its Subsidiaries does not
infringe on the rights of any Person, subject to such claims and infringements
as do not, in the aggregate, give rise to any liabilities on the part of the
Borrower or any of its Subsidiaries that could be reasonably expected to have a
Material Adverse Effect.

 

5.21                                                   Broker’s Fees.  No broker’s or finder’s fee, commission or
similar compensation will be payable with respect to the transactions
contemplated hereby.  Except as provided
in the Fee Letter, no other similar fees or commissions will be payable by any
Lender for any other services rendered to the Borrower, any of the Subsidiaries
of the Borrower or any other Person ancillary to the transactions contemplated
hereby.

 

5.22                                                   Unencumbered
Assets and Trapped Equity Properties.  As of the Agreement Execution Date, Schedule 7
is a correct and complete list of all Unencumbered Assets and Trapped Equity
Properties.  Each of the assets included
by the Borrower in calculations of the Aggregate Pool Value satisfies all of
the requirements contained in this Agreement for the same to be included
therein.

 

5.23                                                   No Bankruptcy
Filing.  Neither Borrower nor any of
its Subsidiaries is contemplating either the filing of a petition by it under
any state or federal bankruptcy or insolvency laws or the liquidation of its
assets or property, and Borrower has no knowledge of any Person contemplating
the filing of any such petition against any of such Persons.

 

41

 

5.24                                                   No Fraudulent
Intent.  Neither the execution and
delivery of this Agreement or any of the other Loan Documents nor the
performance of any actions required hereunder or thereunder is being undertaken
by Borrower or the Subsidiary Guarantors with or as a result of any actual
intent by any of such Persons to hinder, delay or defraud any entity to which
any of such Persons is now or will hereafter become indebted.

 

5.25                                                   Transaction in
Best Interests of Borrower and Subsidiary Guarantors; Consideration.  The transaction evidenced by this Agreement
and the other Loan Documents is in the best interests of Borrower and the
Subsidiary Guarantors and their respective creditors.  The direct and indirect benefits to inure to
Borrower and the Subsidiary Guarantors pursuant to this Agreement and the other
Loan Documents constitute substantially more than “reasonably equivalent value”
(as such term is used in §548 of the Bankruptcy Code) and “valuable
consideration,” “fair value,” and “fair consideration” (as such terms are used
in any applicable state fraudulent conveyance law), in exchange for the
benefits to be provided by Borrower and the Subsidiary Guarantors pursuant to
this Agreement and the other Loan Documents, and but for the willingness of
each Subsidiary Guarantor to guaranty the Obligations, Borrower would be unable
to obtain the financing contemplated hereunder which financing will enable
Borrower and its subsidiaries to have available financing to conduct and expand
their business.  Borrower and its Subsidiaries
constitute a single integrated financial enterprise and receives a benefit from
the availability of credit under this Agreement.

 

5.26                                                   Subordination.  Borrower is not a party to or bound by any
agreement, instrument or indenture that may require the subordination in right
or time of payment of any of the Obligations to any other indebtedness or
obligation of any such Persons.

 

5.27                                                   Tax Shelter Representation. 
Borrower does not intend to treat the Loans, and/or related transactions
as being a “reportable transaction” (within the meaning of United States
Treasury Regulation Section 1.6011-4). 
In the event Borrower determines to take any action inconsistent with
such intention, it will promptly notify the Administrative Agent thereof.  If Borrower so notifies the Administrative
Agent, Borrower acknowledges that one or more of the Lenders may treat its
Loans as part of a transaction that is subject to Treasury Regulation Section 301.6112-1,
and such Lender or Lenders, as applicable, will maintain the lists and other
records required by such Treasury Regulation.

 

5.28                                                   Anti-Terrorism
Laws.

 

(i)                                     None of the
Borrower or any of its Affiliates is in violation of any laws or regulations
relating to terrorism or money laundering (“Anti-Terrorism Laws”), including
Executive Order No. 13224 on Terrorist Financing, effective September 24,
2001 (the “Executive Order”) and the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001, Public Law 107-56.

 

(ii)                                  None of the
Borrower or any of its Affiliates, or any of its brokers or other agents acting
or benefiting from the Loan is a Prohibited Person.  A “Prohibited Person” is any of the
following:

 

(1)                                  a
person or entity that is listed in the Annex to, or is otherwise subject to the
provisions of, the Executive Order;

 

(2)                                  a
person or entity owned or controlled by, or acting for or on behalf of, any
person or entity that is listed in the Annex to, or is otherwise subject to the
provisions of, the Executive Order;

 

42

 

(3)                                  a
person or entity with whom any Lender is prohibited from dealing or otherwise
engaging in any transaction by any Anti-Terrorism Law;

 

(4)                                  a
person or entity who commits, threatens or conspires to commit or supports “terrorism”
as defined in the Executive Order; or

 

(5)                                  a
person or entity that is named as a “specially designated national and blocked
person” on the most current list published by the U.S. Treasury Department
Office of Foreign Asset Control at its official website or any replacement
website or other replacement official publication of such list.

 

(iii)                               None of the
Borrower or any of its Affiliates or any of its brokers or other agents acting
in any capacity in connection with the Loan (1) conducts any business or
engages in making or receiving any contribution of funds, goods or services to
or for the benefit of any Prohibited Person, (2) deals in, or otherwise
engages in any transaction relating to, any property or interests in property
blocked pursuant to the Executive Order, or (iii) engages in or conspires
to engage in any transaction that evades or avoids, or has the purpose of
evading or avoiding, or attempts to violate, any of the prohibitions set forth
in any Anti-Terrorism Law.

 

Borrower shall not (1) conduct any business or
engage in making or receiving any contribution of funds, goods or services to
or for the benefit of any Prohibited Person, (ii) deal in, or otherwise
engage in any transaction relating to, any property or interests in property
blocked pursuant to the Executive Order or any other Anti-Terrorism Law, or (iii) engage
in or conspire to engage in any transaction that evades or avoids, or has the
purpose of evading or avoiding, or attempts to violate, any of the prohibitions
set forth in any Anti-Terrorism Law (and Borrower shall deliver to
Administrative Agent any certification or other evidence requested from time to
time by Administrative Agent in its reasonable discretion, confirming Borrower’s
compliance herewith).

 

Notwithstanding the foregoing, at any time that
Borrower retains its status as a publicly held company, the representations
made in this Section 5.28 are limited to the Borrower’s knowledge
with respect to Affiliates who are Affiliates due to ownership due to 10% or
more of any class of voting securities.

 

5.29                           Survival. All statements contained in any certificate,
financial statement or other instrument delivered by or on behalf of Borrower
or any of its Subsidiaries to the Administrative Agent or any Lender pursuant
to or in connection with this Agreement or any of the other Loan Documents
(including, but not limited to, any such statement made in or in connection
with any amendment thereto or any statement contained in any certificate,
financial statement or other instrument delivered by or on behalf of the
Borrower prior to the Agreement Execution Date and delivered to the
Administrative Agent or any Lender in connection with closing the transactions
contemplated hereby) shall constitute representations and warranties made by
the Borrower under this Agreement.  All
such representations and warranties shall survive the effectiveness of this
Agreement, the execution and delivery of the Loan Documents and the making of
the Loans and the issuance of the Letters of Credit.

 

43

 

ARTICLE
VI

 

COVENANTS

 

During the term of this Agreement, unless the Required
Lenders shall otherwise consent in writing:

 

6.1         Financial Reporting.  The Borrower will maintain, for itself and
each Subsidiary, a system of accounting established and administered in
accordance with GAAP, and furnish to the Lenders:

 

(i)                                     As soon as
available, but in any event not later than 45 days after the close of each
fiscal quarter, for the Borrower and its Subsidiaries, an unaudited
consolidated balance sheet as of the close of each such period and the related
unaudited consolidated statements of income and retained earnings and of cash
flows of the Borrower and its Subsidiaries for such period and the portion of
the fiscal year through the end of such period, setting forth in each case in
comparative form the figures for the previous year, all certified by the
Borrower’s chief financial officer or chief accounting officer;

 

(ii)                                  As soon as
available, but in any event not later than 45 days after the close of each
fiscal quarter, for the Borrower and its Subsidiaries, the following reports in
form and substance reasonably satisfactory to the Administrative Agent, all
certified by the entity’s chief financial officer or chief accounting
officer:  a statement of Funds From
Operations, a statement of cash flows for each individual Project, a statement
detailing Consolidated Outstanding Indebtedness and Adjusted Annual NOI, a
listing of capital expenditures, a report listing and describing all newly
acquired Projects, including their net operating income, cash flow, cost and
secured or unsecured Indebtedness assumed in connection with such acquisition,
if any, summary Project information to include square footage, occupancy, Net
Operating Income and such other information on all Projects as may be
reasonably requested;

 

(iii)                               As soon as
available, but in any event not later than 90 days after the close of each
fiscal year, for the Borrower and its Subsidiaries, audited financial
statements, including a consolidated balance sheet as at the end of such year
and the related consolidated statements of income and retained earnings and of
cash flows for such year, setting forth in each case in comparative form the
figures for the previous year, without a “going concern” or like qualification
or exception, or qualification arising out of the scope of the audit, prepared
by independent certified public accountants of nationally recognized standing
reasonably acceptable to Administrative Agent;

 

(iv)                              As soon as
available, but in any event not later than 90 days after the close of each
fiscal year, for the Borrower and its Subsidiaries, a statement detailing the
contributions to Adjusted Annual NOI from each individual Project for the prior
fiscal year in form and substance reasonably satisfactory to the Administrative
Agent, certified by the entity’s chief financial officer or chief accounting
officer;

 

(v)                                 Together with
the quarterly and annual financial statements required hereunder, a compliance
certificate in substantially the form of Exhibit C hereto signed by
the Borrower’s chief financial officer or chief accounting officer showing the
calculations and computations necessary to determine compliance with this Agreement
and stating that, to such officer’s knowledge, no Default or Unmatured Default
exists, or if, to such officer’s knowledge, any Default or Unmatured Default
exists, stating the nature and status thereof;

 

(vi)                              As soon as
possible and in any event within 10 days after a responsible officer of the
Borrower knows that any Reportable Event has occurred with respect to any Plan,
a statement, signed by the chief financial officer of the Borrower, describing
said Reportable Event and the action which the Borrower proposes to take with
respect thereto;

 

44

 

(vii)                           As soon as
possible and in any event within 10 days after receipt by a responsible officer
of the Borrower, a copy of (a) any notice or claim to the effect that the
Borrower or any of its Subsidiaries is or may be liable to any Person as a
result of the release by the Borrower, any of its Subsidiaries, or any other
Person of any toxic or hazardous waste or substance into the environment, and (b) any
notice alleging any violation of any federal, state or local environmental,
health or safety law or regulation by the Borrower or any of its Subsidiaries,
which, in either case, could have a Material Adverse Effect;

 

(viii)                        Promptly upon
the furnishing thereof to the shareholders of the Borrower, copies of all
financial statements, reports and proxy statements so furnished;

 

(ix)                                Promptly upon
becoming aware of the same and to the extent Borrower, or any of its
Subsidiaries, are aware of the same, notice of the commencement of any
proceeding or investigation by or before any Governmental Authority and any
action or proceeding in any court or other tribunal or before any arbitrator
against or in any other way relating adversely to, or adversely affecting,
Borrower, any of its Subsidiaries or any of their respective properties, assets
or businesses which involve claims individually or in the aggregate in excess
of $5,000,000, and notice of the receipt of notice that any United States
income tax returns of Borrower or any of its Subsidiaries are being audited;

 

(x)                                   Promptly upon
becoming available, a copy of any amendment to a formation document of
Borrower;

 

(xi)                                Promptly upon
becoming aware of the same, notice of any change in the senior management of
Borrower, or any of its Subsidiaries, any change in the business, assets,
liabilities, financial condition, results of operations or business prospects
of Borrower,  or any of its Subsidiaries
which has had or could reasonably be expected to have a Material Adverse Effect,
or any other event or circumstance which has had or could reasonably be
expected to have a Material Adverse Effect;

 

(xii)                             Promptly upon
becoming aware of entry of the same, notice of any order, judgment or decree in
excess of $5,000,000 having been entered against Borrower, or any of its
Subsidiaries or any of their respective properties or assets;

 

(xiii)                          Promptly upon
receipt of the same, notice if Borrower, or any of its Subsidiaries shall
receive any notification from any Governmental Authority alleging a violation
of any Applicable Law or any inquiry which could reasonably be expected to have
a Material Adverse Effect;

 

(xiv)                         Promptly upon
Borrower or any of its Subsidiaries obtaining knowledge thereof, notice of the
occurrence of any of the following:  (i) any
default or event of default under any mortgage encumbering a Trapped Equity
Property or any documents evidencing, securing or otherwise relating to the
Secured Indebtedness secured by such mortgage; or (ii) any event which
constitutes or which with the passage of time, the giving of notice, a
determination of materiality, the satisfaction of any condition or otherwise,
would constitute a default or event of default under the mortgage encumbering a
Trapped Equity Property or any documents evidencing, securing or otherwise
relating to the Secured Indebtedness secured by such mortgage; and

 

45

 

(xv)                            Such other
information (including, without limitation, financial statements for the
Borrower and non-financial information) as the Administrative Agent or any
Lender may from time to time reasonably request.

 

6.2         Use of Proceeds.  The Borrower will use the proceeds of the
Advances to finance the Borrower’s or its Subsidiaries’ acquisition of
Stabilized Retail Projects or for working capital.  The Borrower will not, nor will it permit any
Subsidiary to, use any of the proceeds of the Advances (i) to purchase or
carry any “margin stock” (as defined in Regulation U) if such usage could
constitute a violation of Regulation U by any Lender, (ii) to fund any
purchase of, or offer for, any Capital Stock of any Person, unless such Person
has consented to such offer prior to any public announcements relating thereto,
or (iii) to make any Acquisition other than a Permitted Acquisition.

 

6.3         Notice of Default.  The Borrower will give, and will cause each
of its Subsidiaries to give, prompt notice in writing to the Administrative
Agent and the Lenders of the occurrence of any Default or Unmatured Default and
of any other development, financial or otherwise, which could reasonably be
expected to have a Material Adverse Effect.

 

6.4         Conduct of Business.  The Borrower will do, and will cause each of
its Subsidiaries to do, all things necessary to remain duly incorporated or duly
qualified, validly existing and in good standing as a real estate investment
trust, corporation, general partnership or limited partnership, as the case may
be, in its jurisdiction of incorporation/formation (except with respect to
mergers permitted pursuant to Section 6.12 and Permitted
Acquisitions) and maintain all requisite authority to conduct its business in
each jurisdiction in which its business is conducted, in each jurisdiction in
which any Qualifying Unencumbered Property or Trapped Equity Property owned (or
leased pursuant to an eligible ground lease) by it is located, and in each
other jurisdiction in which the character of its properties or the nature of
its business requires such qualification and authorization and where the
failure to be so authorized and qualified could reasonably be expected to have
a Material Adverse Effect, and to carry on and conduct their businesses in
substantially the same manner as they are presently conducted where the failure
to do so could reasonably be expected to have a Material Adverse Effect and,
specifically, neither the Borrower nor its Subsidiaries may undertake any
business other than the acquisition, development, ownership, management,
operation and leasing of retail, office or industrial properties, and ancillary
businesses specifically related to such types of properties.  Borrower shall, and shall cause each
Subsidiary, to develop and implement such programs, policies and procedures as
are necessary to comply with the USA Patriot Act and shall promptly advise the
Administrative Agent in writing in the event that any of such Persons shall
determine that any investors in such Persons are in violation of such act.

 

6.5         Taxes.  The Borrower will pay, and will cause each of
its Subsidiaries to pay, when due all taxes, assessments and governmental
charges and levies upon them of their income, profits or Projects, except those
which are being contested in good faith by appropriate proceedings and with
respect to which adequate reserves have been set aside.

 

6.6         Insurance.  The Borrower will, and will cause each of its
Subsidiaries to, maintain insurance which is consistent with the representation
contained in Section 5.17 on all their Property and the Borrower
will furnish to any Lender upon reasonable request full information as to the
insurance carried.

 

6.7         Compliance with Laws.  The Borrower will, and will cause each of its
Subsidiaries to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which they may be subject, the
violation of which could reasonably be expected to have a Material Adverse
Effect.

 

46

 

6.8         Maintenance of Properties.  The Borrower will, and will cause each of its
Subsidiaries to, do all things necessary to maintain, preserve, protect and
keep their respective Projects and Properties, reasonably necessary for the
continuous operation of the Projects, in good repair, working order and
condition, ordinary wear and tear excepted.

 

6.9         Inspection.  The Borrower will, and will cause each of its
Subsidiaries to, permit the Lenders upon reasonable notice, by their respective
representatives and agents, to inspect any of the Projects, corporate books and
financial records of the Borrower and each of its Subsidiaries, to examine and
make copies of the books of accounts and other financial records of the
Borrower and each of its Subsidiaries, and to discuss the affairs, finances and
accounts of the Borrower and each of its Subsidiaries with officers thereof,
and to be advised as to the same by, their respective officers at such
reasonable times and intervals as the Lenders may designate.

 

6.10                                                   Maintenance of
Status; Modification of Formation Documents.  The Borrower shall at all times
 maintain its status as a real estate investment trust in compliance with
all applicable provisions of the Code relating to such status. The Borrower
shall not amend any of its articles of incorporation or by-laws without the
prior written consent of the Administrative Agent. The Borrower shall not, and
shall not permit any Subsidiary of Borrower to, enter into any amendment or
modification of any formation documents of Borrower or such Subsidiary which
would have a Material Adverse Effect.

 

6.11                                                   Dividends.  Provided there is no then-existing Default or
(after notice thereof to Borrower) Unmatured Default hereunder, the Borrower
and its Subsidiaries shall be permitted to declare and pay dividends on their
Capital Stock from time to time in amounts determined by Borrower, provided,
however, that in no event shall Borrower declare or pay dividends on its
Capital Stock or make distributions with respect thereto to (including
dividends paid and distributions actually made with respect to gains on
property sales and any preferred dividends or distributions as the Borrower may
be contractually required to make from time to time from the Inland-Ryan joint
ventures) if such dividends and distributions paid on account of the
then-current fiscal quarter and the three immediately preceding fiscal
quarters, in the aggregate sales for such period, would exceed 95% of Funds
From Operations for such period plus (B) without duplication, all gains on
property sales for such period to the extent distributions were actually made
with respect thereto.  Notwithstanding
the foregoing, the Borrower shall be permitted at all times to distribute
whatever amount of dividends is necessary to maintain its tax status as a real
estate investment trust.

 

6.12                                                   Merger; Sale of
Assets.  The Borrower will not, nor will
it permit any of its Subsidiaries to, without prior notice to the
Administrative Agent and without providing a certification of compliance with
the Loan Documents enter into any merger (other than mergers in which such
entity is the survivor and mergers of Subsidiaries (but not the Borrower) as
part of transactions that are Permitted Acquisitions provided that following
such merger the target entity becomes a Wholly-Owned Subsidiary of Borrower),
consolidation, reorganization or liquidation or transfer or otherwise dispose
of all or a Substantial Portion of their Properties, except for (a) such
transactions that occur between Wholly-Owned Subsidiaries or between Borrower
and a Wholly-Owned Subsidiary and (b) mergers solely to change the
jurisdiction of organization of a Subsidiary Guarantor, provided that, in any
event, approval in advance by the Required Lenders shall be required for
transfer or disposition in any quarter of assets with an aggregate value
greater than 10% of Total Asset Value, or any merger resulting in an increase
to the Total Asset Value of more than 35%.

 

6.13                                                   Delivery and
Release of Subsidiary Guaranties.  Borrower shall cause each of its existing
Subsidiaries (other than a Subsidiary which is a single-purpose entity which
owns only 

 

47

 

Projects subject to securitized Indebtedness
and which has restrictions on the creation of additional Indebtedness and other
safeguards typically imposed on such single-purpose entities in securitized financings)
to execute and deliver to the Administrative Agent the Subsidiary
Guaranty.  Within 10 days after the later
of the date Borrower forms or acquires any Subsidiary or the date such
Subsidiary first owns a Project, Borrower shall cause such Subsidiary (other
than Subsidiaries excluded under the parenthetical in the preceding sentence)
to execute and deliver to the Administrative Agent a joinder in the Subsidiary
Guaranty, together with supporting organizational and authority documents and
opinions similar to those provided with respect to the Borrower under Section 4.1
hereof.  If a Subsidiary that is
initially not required to deliver a Subsidiary Guaranty under the parenthetical
in the first sentence is later not precluded from doing so, then Borrower shall
cause such Subsidiary to deliver a Joinder to Guaranty (in the form attached as
Exhibit A to the form of Subsidiary Guaranty attached hereto as Exhibit F)
and such supporting documents and opinions at that time.  If a Subsidiary Guarantor has sold its
Projects and has liquidated all of its other assets and applied all of the
proceeds of such liquidation in accordance with the terms of the Loan Documents
and its organizational documents, such Subsidiary Guarantor shall be released
from the Subsidiary Guaranty or from any other liability it may have undertaken
with respect to the Obligations.

 

6.14                                                   Sale and
Leaseback.  The
Borrower will not, nor will it permit any of its Subsidiaries to, sell or
transfer a Substantial Portion of its Property in order to concurrently or
subsequently lease such Property as lessee.

 

6.15                                                   Acquisitions
and Investments.  The
Borrower will not, nor will it permit any Subsidiary to, make or suffer to
exist any Investments (including without limitation, loans and advances to, and
other Investments in, Subsidiaries), or commitments therefor, or become or
remain a partner in any partnership or joint venture, or to make any
Acquisition of any Person, except:

 

(i)                                     Cash
Equivalents and Marketable Securities;

 

(ii)                                  Investments in
existing Subsidiaries, Investments in Subsidiaries formed for the purpose of
developing or acquiring Properties, Investments in joint ventures and
partnerships engaged solely in the business of purchasing, developing, owning,
operating, leasing and managing retail properties, and Investments in existence
on the date hereof and described in Schedule 1 hereto;

 

(iii)                               transactions
permitted pursuant to Section 6.12; and

 

(iv)                              transactions
permitted pursuant to Section 6.23; and

 

(v)                                 Acquisitions of
Persons whose primary operations consist of the ownership, development,
operation and management of retail properties;

 

provided that, after giving effect to such
Acquisitions and Investments, Borrower continues to comply with all its
covenants herein.  Acquisitions permitted
pursuant to this Section 6.15 shall be deemed to be “Permitted
Acquisitions”.

 

6.16                                                   Liens.  The Borrower will not, nor will it permit any
of its Subsidiaries to, create, incur, or suffer to exist any Lien in, of or on
the Property of the Borrower or any of its Subsidiaries, except:

 

(i)                                     Liens for
taxes, assessments or governmental charges or levies on its Property if the
same shall not at the time be delinquent or thereafter can be paid without
penalty, or are 

 

48

 

being contested in good faith and by
appropriate proceedings and for which adequate reserves shall have been set
aside on its books;

 

(ii)                                  Liens imposed
by law, such as carriers’, warehousemen’s and mechanics’ liens and other
similar liens arising in the ordinary course of business which secure payment
of obligations not more than 60 days past due or which are being contested in
good faith by appropriate proceedings and for which adequate reserves shall
have been set aside on its books;

 

(iii)                               Liens arising
out of pledges or deposits under workers’ compensation laws, unemployment
insurance, old age pensions, or other social security or retirement benefits,
or similar legislation;

 

(iv)                              Easements,
restrictions and such other encumbrances or charges against real property as
are of a nature generally existing with respect to properties of a similar
character and which do not in any material way affect the marketability of the
same or interfere with the use thereof in the business of the Borrower or its
Subsidiaries;

 

(v)                                 Liens on
Projects existing on the date hereof which secure Indebtedness as described in Schedule
2 hereto; and

 

(vi)                              Liens other
than Liens described in subsections (i) through (iv) above arising in
connection with any Indebtedness permitted hereunder to the extent such Liens
will not result in a Default in any of Borrower’s covenants herein.

 

Liens permitted pursuant to this Section 6.16
shall be deemed to be “Permitted Liens”.

 

6.17                                                   Affiliates.  The Borrower will not, nor will it permit any
of its Subsidiaries to, enter into any transaction (including, without
limitation, the purchase or sale of any Property or service) with, or make any
payment or transfer to, any Affiliate except in the ordinary course of business
and pursuant to the reasonable requirements of the Borrower’s or such
Subsidiary’s business and upon fair and reasonable terms no less favorable to
the Borrower or such Subsidiary than the Borrower or such Subsidiary would
obtain in a comparable arms-length transaction.

 

6.18                                                   Swap Contracts.  The Borrower will not enter into or remain
liable upon, nor will it permit any Subsidiary to enter into or remain liable
upon, any Swap Contract, except to the extent required to protect the Borrower
and its Subsidiaries against increases in interest payable by them under
variable interest Indebtedness.

 

6.19                                                   Variable
Interest Indebtedness.  The
Borrower and its Subsidiaries shall not at any time permit the outstanding
principal balance of Indebtedness which bears interest at an interest rate that
is not fixed through the maturity date of such Indebtedness to exceed twenty
percent (20%) of Total Asset Value, unless all of such Indebtedness in excess
of such amount is subject to a Swap Contract approved by the Administrative
Agent that effectively converts the interest rate on such excess to a fixed
rate.

 

6.20                                                   Consolidated
Net Worth.  The
Borrower shall maintain a Consolidated Net Worth of not less than $600,000,000
plus ninety percent (90%) of the equity contributions or sales of treasury stock
received by the Borrower after the Agreement Execution Date.

 

6.21                                                   Indebtedness
and Cash Flow Covenants.  The
Borrower on a consolidated basis with its Subsidiaries shall not permit:

 

49

 

(i)                                     any Guaranteed
Obligations or any Secured Indebtedness of any member of the Consolidated Group
which is also Recourse Indebtedness to exist, (A) at any time prior to
achievement of an Unencumbered Leverage Ratio of 1.50, which exceeds in the
aggregate $50,000,000, and (B) at any time on and after the achievement of
an Unencumbered Leverage Ratio of 1.50, which exceeds in the aggregate 10% of
Total Asset Value;

 

(ii)                                  at any time
prior to achievement of an Unencumbered Leverage Ratio of 1.50, any Unsecured
Indebtedness to exist, other than the Obligations under this Agreement and up
to $200,000,000 in the aggregate of other Unsecured Indebtedness;

 

(iii)                               the
Unencumbered Leverage Ratio to be less than (A) 1.10, at any time prior to
the Unencumbered Trigger Date, (B) 1.50, on the Unencumbered Trigger Date
and at any time subsequent to the Unencumbered Trigger Date through and
including December 31, 2009, and (C) 1.60, at any time subsequent to December 31,
2009;

 

(iv)                              Adjusted Annual
EBITDA to be less than 1.50 times Fixed Charges at any time;

 

(v)                                 Secured
Indebtedness to be (A) more than 0.50 times Total Asset Value at any time
through and including the Unencumbered Trigger Date, or (B) more than 0.40
times Total Asset Value at any time subsequent to the Unencumbered Trigger
Date;

 

(vi)                              Consolidated
Outstanding Indebtedness to be more than 0.60 times Total Asset Value at any
time;

 

(vii)                           the
Unencumbered Asset Value to be less than $250,000,000 at any time; or

 

(viii)                        at any time
after the Unencumbered Trigger Date, Unsecured Debt Service Coverage to be less
than 1.50 to 1.00.

 

6.22                                                   Environmental
Matters.  Borrower and its Subsidiaries
shall:

 

(a)                                        Comply with, and use all reasonable
efforts to ensure compliance by all tenants and subtenants, if any, with, all
applicable Environmental Laws and obtain and comply with and maintain, and use
all reasonable efforts to ensure that all tenants and subtenants obtain and
comply with and maintain, any and all licenses, approvals, notifications,
registrations or permits required by applicable Environmental Laws, except to
the extent that failure to do so could not be reasonably expected to have a
Material Adverse Effect; provided that in no event shall the Borrower or its
Subsidiaries be required to modify the terms of leases, or renewals thereof,
with existing tenants (i) at Projects owned by the Borrower or its
Subsidiaries as of the date hereof, or (ii) at Projects hereafter acquired
by the Borrower or its Subsidiaries as of the date of such acquisition, to add
provisions to such effect.

 

(b)                                       Conduct and complete all investigations,
studies, sampling and testing, and all remedial, removal and other actions
required under Environmental Laws and promptly comply in all material respects
with all lawful orders and directives of all Governmental Authorities regarding
Environmental Laws, except 

 

50

 

to the extent that (i) the same are being contested in good faith
by appropriate proceedings and the pendency of such proceedings could not be
reasonably expected to have a Material Adverse Effect, or (ii) the
Borrower has determined in good faith that contesting the same is not in the
best interests of the Borrower and its Subsidiaries and the failure to contest
the same could not be reasonably expected to have a Material Adverse Effect.

 

(c)                                        Defend, indemnify and hold harmless
Administrative Agent and each Lender, and their respective officers and
directors, from and against any claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature known or
unknown, contingent or otherwise, arising out of, or in any way relating to the
violation of, noncompliance with or liability under any Environmental Laws
applicable to the operations of the Borrower, its Subsidiaries or the Projects,
or any orders, requirements or demands of Governmental Authorities related
thereto, including, without limitation, attorney’s and consultant’s fees,
investigation and laboratory fees, response costs, court costs and litigation
expenses, except to the extent that any of the foregoing arise out of the gross
negligence or willful misconduct of the party seeking indemnification
therefor.  This indemnity shall continue
in full force and effect regardless of the termination of this Agreement.

 

(d)                                       Prior to the acquisition of a new Project
after the Agreement Execution Date, perform or cause to be performed an
environmental investigation which investigation shall include preparation of a “Phase
I” report and, if appropriate, a “Phase II” report, in each case prepared by a
recognized environmental engineer in accordance with customary standards which
discloses that the such Project is not in violation of the representations and
covenants set forth in this Agreement, unless such violation has been disclosed
in writing to the Administrative Agent and remediation actions satisfactory to
the Administrative Agent are being taken, and at a minimum comply with the
specifications and procedures attached hereto as Exhibit G.  In connection with any such investigation,
Borrower shall cause to be prepared a report of such investigation, to be made
available to any Lenders upon reasonable request, for informational purposes
and to assure compliance with the specifications and procedures.

 

6.23                                                   Permitted
Investments.

 

(a)                                        The Consolidated Group’s Investment in
Unimproved Land shall not at any time exceed five percent (5%) of Total Asset
Value.

 

(b)                                       The Consolidated Group’s Investment in
First Mortgage Receivables (with each asset valued at the lower of its 

 

51

 

acquisition cost and its fair market value) shall not at any time
exceed five percent (5%) of Total Asset Value.

 

(c)                                        The Consolidated Group’s aggregate
Investment in (i) Investment Affiliates and (ii) any entity which is
not a Wholly-Owned Subsidiary (valued at the greater of the cash investment in
that entity by Borrower or the portion of Total Asset Value attributable to
such entity or its assets as the case may be)  shall
not at any time exceed twenty percent (20%) of Total Asset Value.

 

(d)                                       The Consolidated Group’s Investment in
Construction in Progress (with each asset valued at the lower of its
acquisition cost and its fair market value) shall not at any time exceed five
percent (5%) of Total Asset Value.

 

(e)                                        The Consolidated Group’s Investment in
Marketable Securities shall not at any time exceed five percent (5%) of Total
Asset Value.

 

(f)                                          The Consolidated Group’s aggregate
Investment in the above items (b)-(e) in the aggregate shall not at any
time exceed thirty-five (35%) of Total Asset Value

 

6.24                                                   Prohibited
Encumbrances.  The
Borrower agrees that neither the Borrower nor any other member of the
Consolidated Group shall (i) create a Lien against any Project other than
a single first-priority mortgage or deed of trust, (ii) create a Lien on
any Capital Stock or other ownership interests in any member of the
Consolidated Group or any Investment Affiliate or (iii) enter into or be
subject to any agreement governing any Indebtedness which constitutes a
Negative Pledge (other than restrictions on further subordinate Liens on
Projects already encumbered by a first-priority mortgage or deed of trust).

 

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

 

6.26                                                   Distribution of Income to the Borrower.  Borrower shall cause all of
its Subsidiaries to promptly distribute to Borrower (but not less frequently
than once each fiscal quarter of Borrower unless otherwise approved by the
Administrative Agent), whether in the form of dividends, distributions or
otherwise, all profits, proceeds or other income relating to or arising from
such Subsidiaries’ use, operation, financing, refinancing, sale or other
disposition of their respective assets and properties after (a) the
payment by each such Subsidiary of its debt service and operating expenses for
such quarter and (b) the establishment of reasonable reserves for the
payment of operating expenses not paid on at least a quarterly basis and
capital improvements to be made to such Subsidiary’s assets and properties
approved by such Subsidiary in the ordinary course of business consistent with
its past practices, (c) funding of reserves required by the terms of any
deed of trust, mortgage or similar lien encumbering property of the Subsidiary;
(d) payment or 

 

52

 

establishment of reserves for payment to
minority equity interest holders of amounts required to be paid in respect of
such equity interest.

 

6.27                                                   More
Restrictive Agreements. 
Should Borrower, while this Agreement is in effect or any Note remains
unpaid or any Letter of Credit remains outstanding, enter into, refinance or
modify any agreements pertaining to any existing or future Indebtedness or
issuance of Capital Stock which agreements or documents include covenants
(whether affirmative or negative), warranties, representations, or defaults or
events of default (or any other provision which may have the practical effect
of any of the foregoing, including, without limitation, any “put” or mandatory
prepayment of such debt) other than those set forth herein or in any of the
other Loan Documents, Borrower shall promptly so notify the Administrative
Agent and, if requested by the Administrative Agent or the Required Lenders,
Borrower, the Administrative Agent and the Required Lenders shall promptly
amend this Agreement and the other Loan Documents to incorporate some or all of
such provisions as determined by the Required Lenders in their sole discretion;
provided, however, that any such amendment shall provide that,
upon cancellation or termination of the loan agreement, credit agreement, or
other instrument pertaining to such other Indebtedness or issuance of Capital
Stock (other than by reason of an event of default thereunder), so long as no
Default or Unmatured Default is in existence, such amendment also shall
terminate and the provisions of this Agreement affected by such amendment shall
revert to the terms thereof as in effect prior to giving effect to such
amendment.

 

ARTICLE VII

 

DEFAULTS

 

The occurrence of any one or more of the following
events shall constitute a Default:

 

7.1         Nonpayment of any principal
payment on any Note when due.

 

7.2         Nonpayment of interest upon
any Note or of any facility fee or other payment Obligations under any of the
Loan Documents within five (5) Business Days after the same becomes due.

 

7.3         The breach of any of the
terms or provisions of Article VI.

 

7.4         Any representation or
warranty made or deemed made by or on behalf of the Borrower or any of its
Subsidiaries to the Lenders or the Administrative Agent under or in connection
with this Agreement, any Loan, or any material certificate or information
delivered in connection with this Agreement or any other Loan Document shall be
materially false on the date as of which made.

 

7.5         The breach by the Borrower
(other than a breach which constitutes a Default under Section 7.1,
7.2, 7.3 or 7.4) of any of the terms or provisions of this
Agreement which is not remedied within five (5) days after written notice
from the Administrative Agent or any Lender.

 

7.6         Failure of the Borrower or
any of its Subsidiaries to pay when due any Recourse Indebtedness, regardless
of amount, or any other Consolidated Outstanding Indebtedness (other than
Indebtedness hereunder and Indebtedness under Swap Contracts) in excess of
$10,000,000 in the aggregate (collectively, “Material Indebtedness”); or the
default by the Borrower or any of its Subsidiaries in the performance of any
term, provision or condition contained in any agreement, or any other event
shall occur or condition exist, which causes or permits any such Material
Indebtedness to be due and payable or required to be prepaid (other than by a
regularly scheduled 

 

53

 

payment) prior to the stated maturity thereof
(provided that the failure to pay any such Material Indebtedness shall not
constitute a Default so long as the Borrower or its Subsidiaries is diligently
contesting the payment of the same by appropriate legal proceedings and the
Borrower or its Subsidiaries have set aside, in a manner reasonably
satisfactory to Administrative Agent, a sufficient reserve to repay such
Indebtedness plus all accrued interest thereon calculated at the default rate
thereunder and costs of enforcement in the event of an adverse outcome); or,
under any Swap Contract, the occurrence of an Early Termination Date (as
defined in such Swap Contract) resulting from (A) any event of default
under such Swap Contract as to which the Borrower or any Subsidiary is the
Defaulting Party (as defined in such Swap Contract) or (B) any Termination
Event (as so defined) under such Swap Contract as to which the Borrower or any
Subsidiary is an Affected Party (as so defined) and, in either event, the Swap
Termination Value owed by the Borrower or such Subsidiary as a result thereof
is greater than $10,000,000.

 

7.7         The Borrower, or any
Subsidiary shall (i) have an order for relief entered with respect to it
under the Federal bankruptcy laws as now or hereafter in effect, (ii) make
an assignment for the benefit of creditors, (iii) apply for, seek, consent
to, or acquiesce in, the appointment of a receiver, custodian, trustee,
examiner, liquidator or similar official for it or any Substantial Portion of
its Property, (iv) institute any proceeding seeking an order for relief
under the Federal bankruptcy laws as now or hereafter in effect or seeking to
adjudicate it as a bankrupt or insolvent, or seeking dissolution, winding up,
liquidation, reorganization, arrangement, adjustment or composition of it or
its debts under any law relating to bankruptcy, insolvency or reorganization or
relief of debtors or fail to file an answer or other pleading denying the
material allegations of any such proceeding filed against it, (v) take any
corporate action to authorize or effect any of the foregoing actions set forth
in this Section 7.7, (vi) fail to contest in good faith any
appointment or proceeding described in Section 7.8 or (vii) admit
in writing its inability to pay its debts generally as they become due.

 

7.8         A receiver, trustee, examiner,
liquidator or similar official shall be appointed for the Borrower or any
Subsidiary or for any Substantial Portion of the Property of the Borrower or
such Subsidiary, or a proceeding described in Section 7.7(iv) shall
be instituted against the Borrower or any such Subsidiary and such appointment
continues undischarged or such proceeding continues undismissed or unstayed for
a period of ninety (90) consecutive days.

 

7.9         The Borrower or any of its
Subsidiaries shall fail within sixty (60) days to pay, bond or otherwise
discharge any judgments, warrants, writs of attachment, execution or similar
process or orders for the payment of money in an amount which, when added to
all other judgments, warrants, writs, executions, processes or orders
outstanding against Borrower or any Subsidiary would exceed $10,000,000 in the
aggregate, which have not been stayed on appeal or otherwise appropriately
contested in good faith; provided, however, that if a bond has
been issued in favor of the claimant or other Person obtaining such judgment,
warrant, writ, execution, order or process, the issuer of such bond shall
execute a waiver or subordination agreement in form and substance satisfactory
to the Administrative Agent pursuant to which the issuer of such bond subordinates
its right of reimbursement, contribution or subrogation to the Obligations and
waives or subordinates any Lien it may have on the assets of Borrower or its
Subsidiaries.

 

7.10                                                   The Borrower or
any other member of the Controlled Group shall have been notified by the
sponsor of a Multiemployer Plan that it has incurred withdrawal liability to
such Multiemployer Plan in an amount which, when aggregated with all other
amounts required to be paid to Multiemployer Plans by the Borrower or any other
member of the Controlled Group as withdrawal liability (determined as of the
date of such notification), exceeds $1,000,000 or requires payments exceeding
$500,000 per annum.

 

54

 

7.11                                                   The Borrower or
any other member of the Controlled Group shall have been notified by the
sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or is being terminated, within the meaning of Title IV of ERISA,
if as a result of such reorganization or termination the aggregate annual
contributions of the Borrower and the other members of the Controlled Group
(taken as a whole) to all Multiemployer Plans which are then in reorganization
or being terminated have been or will be increased over the amounts contributed
to such Multiemployer Plans for the respective plan years of each such
Multiemployer Plan immediately preceding the plan year in which the
reorganization or termination occurs by an amount exceeding $500,000.

 

7.12                                                   Failure to
remediate within the time period permitted by law or governmental order, after
all administrative hearings and appeals have been concluded (or within a
reasonable time in light of the nature of the problem if no specific time
period is so established), environmental problems at Properties owned by the
Borrower or any of its Subsidiaries or Investment Affiliates.

 

7.13                                                   The occurrence
of any “Default” as defined in any Loan Document or the breach of any of the
terms or provisions of any Loan Document, which default or breach continues
beyond any period of grace therein provided.

 

7.14                                                   The attempted
revocation, challenge, disavowment, or termination by the Borrower or
Guarantors of any of the Loan Documents.

 

7.15                                                   Any Change of
Control shall occur.

 

7.16                                                   Any Change in
Management shall occur.

 

7.17                                                   A federal tax
lien shall be filed against Borrower or any of its Subsidiaries under Section 6323
of the Code or a lien of the PBGC shall be filed against Borrower or any of its
Subsidiaries under Section 4068 of ERISA and in either case such lien shall
remain undischarged (or otherwise unsatisfied) for a period of twenty-five (25)
days after the date of filing.

 

ARTICLE VIII

 

ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES

 

8.1         Acceleration.  If any Default described in Section 7.7
or 7.8 occurs with respect to the Borrower, the obligations of the
Lenders to make Loans and to issue Facility Letters of Credit hereunder shall
automatically terminate and the Facility Obligations shall immediately become
due and payable without any election or action on the part of the
Administrative Agent or any Lender.  If
any other Default occurs, so long as a Default exists Lenders shall have no
obligation to make any Loans and the Required Lenders, at any time prior to the
date that such Default has been fully cured, may permanently terminate the
obligations of the Lenders to make Loans hereunder and declare the Facility
Obligations to be due and payable, or both, whereupon if the Required Lenders
elected to accelerate (i) the Facility Obligations shall become immediately
due and payable, without presentment, demand, protest or notice of any kind,
all of which the Borrower hereby expressly waives and (ii) if any
automatic or optional acceleration has occurred, the Administrative Agent, as
directed by the Required Lenders (or if no such direction is given within 30
days after a request for direction, as the Administrative Agent deems in the
best interests of the Lenders, in its sole discretion), shall use its good
faith efforts to collect, including without limitation, by filing and
diligently pursuing judicial action, all amounts owed by the Borrower and any
Subsidiary Guarantor under the Loan Documents.

 

55

 

In addition to the
foregoing, following the occurrence of a Default and so long as any Facility
Letter of Credit has not been fully drawn and has not been cancelled or expired
by its terms, upon demand by the Required Lenders the Borrower shall deposit in
the Letter of Credit Collateral Account cash in an amount equal to the
aggregate undrawn face amount of all outstanding Facility Letters of Credit and
all fees and other amounts due or which may become due with respect
thereto.  The Borrower shall have no
control over funds in the Letter of Credit Collateral Account and shall not be
entitled to receive any interest thereon. 
Such funds shall be promptly applied by the Administrative Agent to
reimburse the Issuing Bank for drafts drawn from time to time under the
Facility Letters of Credit and associated issuance costs and fees.  Such funds, if any, remaining in the Letter
of Credit Collateral Account following the payment of all Facility Obligations
in full shall, unless the Administrative Agent is otherwise directed by a court
of competent jurisdiction, be promptly paid over to the Borrower.

 

If, within 10 days after acceleration of the maturity
of the Facility Obligations or termination of the obligations of the Lenders to
make Loans hereunder as a result of any Default (other than any Default as
described in Section 7.7 or 7.8 with respect to the
Borrower) and before any judgment or decree for the payment of the Facility
Obligations due shall have been obtained or entered, all of the Lenders (in
their sole discretion) shall so direct, the Administrative Agent shall, by notice
to the Borrower, rescind and annul such acceleration and/or termination.

 

8.2         Amendments.  Subject to the provisions of this Article VIII
the Required Lenders (or the Administrative Agent with the consent in writing
of the Required Lenders) and the Borrower may enter into agreements
supplemental hereto for the purpose of adding or modifying any provisions to
the Loan Documents or changing in any manner the rights of the Lenders or the
Borrower hereunder or waiving any Default hereunder; provided, however, that no
such supplemental agreement or waiver shall, without the consent of all
Lenders:

 

(i)                                     Extend the
Facility Termination Date, or forgive all or any portion of the principal
amount of any Loan or accrued interest thereon or of the Facility Letter of
Credit Obligations or of the Unused Fee, reduce the Applicable Margins (or
modify any definition herein which would have the effect of reducing the
Applicable Margins) or the underlying interest rate options or extend the time
of payment of any such principal, interest or facility fees.

 

(ii)                                  Release any
Subsidiary Guarantor, except as permitted in Section 6.13 (other
than a Subsidiary Guarantor that has liquidated all of its assets and applied
all of the proceeds of such liquidation in accordance with its organizational
documents) from the Subsidiary Guaranty or any other future guarantor (other
than a Subsidiary Guarantor that has liquidated all of its assets and applied
all of the proceeds of such liquidation in accordance with its organizational
documents) from any liability it may undertake with respect to the Obligations.

 

(iii)                               Reduce the
percentage specified in the definition of Required Lenders.

 

(iv)                              Increase the
Aggregate Commitment beyond $155,000,000, except as provided for in Section 2.2
above.

 

(v)                                 Permit the
Borrower to assign its rights under this Agreement.

 

(vi)                              Amend Sections
2.1(ii),  2.13, 8.1, 8.2 or 11.2.

 

(vii)                           Waive compliance with the Unencumbered
Leverage Ratio requirement on December 31, 2008 as provided for in Section 6.21(iii) or
amend the definition of (A) Unencumbered Trigger Date, (B) Aggregate
Pool Value or (C) any of the defined terms used in 

 

56

 

the definition of the Unencumbered Trigger Date and
Aggregate Pool Value, as set forth in Article I.

 

No amendment of any provision of this Agreement
relating to the Administrative Agent shall be effective without the written
consent of the Administrative Agent.  If
the Required Lenders have agreed to waive the requirement of Section 7.15
and permit a Change of Control to occur, each non-consenting Lender shall have
the option to terminate its Commitment, provided that such option is exercised
within five (5) Business Days after the Administrative Agent has notified
all Lenders that the Required Lenders have agreed to such a waiver by written
notice from such non-consenting Lender to Administrative Agent and Borrower.
Upon the termination of such a non-consenting Lender’s Commitment, such
non-consenting Lender’s obligation to fund Loans and to participate in Facility
Letters of Credit shall be terminated as of the date such Change of Control
occurs and Borrower shall repay any outstanding Obligations due to such Lender
prior to or concurrently with the occurrence of such Change of Control.
Following the termination of any Commitment pursuant to this Section 8.2,
the Aggregate Commitment shall be reduced by the amount of the Commitment or
Commitments terminated, and the Percentages of each of the remaining Lenders
shall be adjusted to reflect their share of the new reduced Aggregate
Commitment.

 

8.3         Preservation of Rights.  No delay or omission of the Lenders or the
Administrative Agent to exercise any right under the Loan Documents shall
impair such right or be construed to be a waiver of any Default or an
acquiescence therein, and the making of a Loan notwithstanding the existence of
a Default or the inability of the Borrower to satisfy the conditions precedent
to such Loan shall not constitute any waiver or acquiescence.  Any single or partial exercise of any such
right shall not preclude other or further exercise thereof or the exercise of
any other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid unless
in writing signed by the Lenders required pursuant to Section 8.2,
and then only to the extent in such writing specifically set forth.  All remedies contained in the Loan Documents
or by law afforded shall be cumulative and all shall be available to the
Administrative Agent and the Lenders until the Obligations have been paid in
full.

 

8.4         Insolvency of Borrower.  In the event of the insolvency of the
Borrower, the Lenders shall have no obligation to make further disbursements of
the Facility, and the outstanding principal balance of the Facility, including
accrued and unpaid interest thereon, shall be immediately due and payable.

 

8.5         Application of Funds. After the
acceleration of the Facility Obligations as provided for in Section 8.1
(or after the Facility Obligations have automatically become immediately due
and payable and Borrower has been required to make a deposit in the Letter of
Credit Collateral Account as set forth in Section 8.1), any amounts
received on account of the Obligations shall be applied by the Administrative
Agent in the following order:

 

(i)                                     to payment of
that portion of the Obligations constituting fees, indemnities, expenses and
other amounts (including attorney costs and amounts payable under Article III)
payable to the Administrative Agent in its capacity as such;

 

(ii)                                  to payment of
that portion of the Obligations constituting fees, indemnities and other
amounts (other than principal and interest) payable to the Lenders (including
fees, charges and disbursements of counsel to the respective Lenders and the
Issuing Bank and amounts payable under Article III), ratably among
them in proportion to the amounts described in this clause (ii) payable to
them;

 

57

 

(iii)                               to payment of
that portion of the Obligations constituting accrued and unpaid interest on the
Loans, Facility Letter of Credit Reimbursement Obligations and other
Obligations, ratably among the Lenders and the Issuing Bank in proportion to
the respective amounts described in this clause (iii) payable to them;

 

(iv)                              to payment of
that portion of the Obligations constituting unpaid principal of the Loans and
Facility Letter of Credit Reimbursement Obligations and to deposit in the
Letter of Credit Collateral Account the undrawn amounts of Letters of Credit,
ratably among the Lenders, and the Issuing Bank in proportion to the respective
amounts described in this clause (iv) held by them;

 

(v)                                 to payment of
that portion of the Obligations constituting Related Swap Obligations ratably
among the Lenders and Affiliates of Lenders holding such Related Swap
Obligations in proportion to the respective amounts described in this clause (v) held
by them; and

 

(vi)                              the balance, if
any, after all of the Obligations have been indefeasibly paid in full, to the
Borrower or as otherwise required by Law.

 

ARTICLE IX

 

GENERAL PROVISIONS

 

9.1         Survival of Representations.  All representations and warranties of the
Borrower contained in this Agreement shall survive delivery of the Notes and
the making of the Loans herein contemplated.

 

9.2         Governmental Regulation.  Anything contained in this Agreement to the
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.

 

9.3         Taxes.  Any taxes (excluding taxes on the overall net
income of any Lender) or other similar assessments or charges made by any
governmental or revenue authority in respect of the Loan Documents shall be
paid by the Borrower, together with interest and penalties, if any.

 

9.4         Headings.  Section headings in the Loan Documents
are for convenience of reference only, and shall not govern the interpretation
of any of the provisions of the Loan Documents.

 

9.5         Entire Agreement.  The Loan Documents embody the entire
agreement and understanding among the Borrower, the Administrative Agent and
the Lenders and supersede all prior commitments, agreements and understandings
among the Borrower, the Administrative Agent and the Lenders relating to the
subject matter thereof.

 

9.6         Several Obligations;
Benefits of this Agreement.  The respective obligations of the Lenders
hereunder are several and not joint and no Lender shall be the partner or agent
of any other (except to the extent to which the Administrative Agent is
authorized to act as such).  The failure
of any Lender to perform any of its obligations hereunder shall not relieve any
other Lender from any of its obligations hereunder.  This Agreement shall not be construed so as
to confer any right or benefit upon any Person other than the parties to this
Agreement and their respective successors and assigns.

 

58

 

9.7   Expenses; Indemnification.  The Borrower shall reimburse the
Administrative Agent for any costs, internal charges and out-of-pocket expenses
(including, without limitation, all reasonable fees for consultants and fees
and reasonable expenses for attorneys for the Administrative Agent, which
attorneys may be employees of the Administrative Agent) paid or incurred by the
Administrative Agent in connection with the amendment, modification, and
enforcement of the Loan Documents.  The
Borrower also agrees to reimburse the Administrative Agent and the Lenders for
any reasonable costs, internal charges and out-of-pocket expenses (including,
without limitation, all fees and reasonable expenses for attorneys for the
Administrative Agent and the Lenders, which attorneys may be employees of the
Administrative Agent or the Lenders) paid or incurred by the Administrative
Agent or any Lender in connection with the collection and enforcement of the
Loan Documents (including, without limitation, any workout).  The Borrower further agrees to indemnify the
Administrative Agent, each Lender and their Affiliates, and their directors and
officers against all losses, claims, damages, penalties, judgments, liabilities
and expenses (including, without limitation, all fees and reasonable expenses
for attorneys of the indemnified parties, all expenses of litigation or
preparation therefor whether or not the Administrative Agent, or any Lender is
a party thereto) which any of them may pay or incur arising out of or relating
to this Agreement, the other Loan Documents, the Projects, the transactions
contemplated hereby or the direct or indirect application or proposed
application of the proceeds of any Loan hereunder, except to the extent that
any of the foregoing arise out of the gross negligence or willful misconduct of
the party seeking indemnification therefor. 
The obligations of the Borrower under this Section shall survive
the termination of this Agreement.

 

9.8   Numbers of Documents.  All statements, notices, closing documents, and
requests hereunder shall be furnished to the Administrative Agent with
sufficient counterparts so that the Administrative Agent may furnish one to
each of the Lenders.

 

9.9   Accounting.  Except as provided to the contrary herein,
all accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP.

 

9.10                 Severability of Provisions.  Any provision in any Loan Document that is
held to be inoperative, unenforceable, or invalid in any jurisdiction shall, as
to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.

 

9.11                 Nonliability of Lenders.  The relationship between the Borrower, on the
one hand, and the Lenders and the Administrative Agent, on the other, shall be
solely that of borrower and lender.  Neither
the Administrative Agent nor any Lender shall have any fiduciary
responsibilities to the Borrower. 
Neither the Administrative Agent nor any Lender undertakes any
responsibility to the Borrower to review or inform the Borrower of any matter
in connection with any phase of the Borrower’s business or operations.

 

9.12                 CHOICE OF LAW.  THE LOAN DOCUMENTS (OTHER THAN THOSE
CONTAINING A CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE
OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.

 

9.13                 CONSENT TO JURISDICTION.  THE BORROWER HEREBY IRREVOCABLY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED 

 

59

 

STATES FEDERAL OR ILLINOIS STATE COURT
SITTING IN CHICAGO IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS
IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY
SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER
HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A
COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.  NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE
ADMINISTRATIVE AGENT OR ANY LENDER TO BRING PROCEEDINGS AGAINST THE BORROWER IN
THE COURTS OF ANY OTHER JURISDICTION. 
ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE ADMINISTRATIVE AGENT
OR ANY LENDER OR ANY AFFILIATE OF THE ADMINISTRATIVE AGENT OR ANY LENDER
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN A
COURT IN CHICAGO, ILLINOIS.

 

9.14                 WAIVER OF JURY TRIAL.  THE BORROWER, THE ADMINISTRATIVE AGENT AND
EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR
OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT
OR THE RELATIONSHIP ESTABLISHED THEREUNDER.

 

ARTICLE X

 

THE ADMINISTRATIVE AGENT

 

10.1                 Appointment.  KeyBank National Association, is hereby
appointed Administrative Agent hereunder and under each other Loan Document,
and each of the Lenders irrevocably authorizes the Administrative Agent to act
as the agent of such Lender.  The
Administrative Agent agrees to act as such upon the express conditions
contained in this Article X. 
Notwithstanding the use of the defined term “Administrative Agent,” it
is expressly understood and agreed that the Administrative Agent shall not have
any fiduciary responsibilities to any Lender by reason of this Agreement or any
other Loan Document and that the Administrative Agent is merely acting as the
contractual representative of the Lenders with only those duties as are
expressly set forth in this Agreement and the other Loan Documents.  In its capacity as the Lenders’ contractual
representative, the Administrative Agent (i) does not hereby assume any
fiduciary duties to any of the Lenders, (ii) is a “representative” of the
Lenders within the meaning of the term “secured party” as defined in the
Illinois Uniform Commercial Code and (iii) is acting as an independent
contractor, the rights and duties of which are limited to those expressly set
forth in this Agreement and the other Loan Documents.  Each of the Lenders hereby agrees to assert
no claim against the Administrative Agent on any agency theory or any other
theory of liability for breach of fiduciary duty, all of which claims each
Lender hereby waives.

 

10.2                 Powers.  The Administrative Agent shall have and may
exercise such powers under the Loan Documents as are specifically delegated to
the Administrative Agent by the terms of each thereof, together with such
powers as are reasonably incidental thereto. 
The Administrative Agent shall have no implied duties to the Lenders, or
any obligation to the Lenders to take any action thereunder except any action
specifically provided by the Loan Documents to be taken by the Administrative
Agent.

 

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10.3                 General Immunity.  Neither the Administrative Agent nor any of
its directors, officers, agents or employees shall be liable to the Borrower,
the Lenders or any Lender for (i) any action taken or omitted to be taken
by it or them hereunder or under any other Loan Document or in connection
herewith or therewith except for its or their own gross negligence or willful
misconduct; or (ii) any determination by the Administrative Agent that
compliance with any law or any governmental or quasi-governmental rule,
regulation, order, policy, guideline or directive (whether or not having the
force of law) requires the Advances and Commitments hereunder to be classified
as being part of a “highly leveraged transaction”.

 

10.4                 No Responsibility for Loans,
Recitals, etc.  Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be responsible for or have any duty to ascertain, inquire into, or verify
(i) any statement, warranty or representation made in connection with any
Loan Document or any borrowing hereunder; (ii) the performance or
observance of any of the covenants or agreements of any obligor under any Loan
Document, including, without limitation, any agreement by an obligor to furnish
information directly to each Lender; (iii) the satisfaction of any
condition specified in Article IV, except receipt of items required
to be delivered to the Administrative Agent; (iv) the validity,
effectiveness or genuineness of any Loan Document or any other instrument or
writing furnished in connection therewith; (v) the value, sufficiency,
creation, perfection, or priority of any interest in any collateral security;
or (vi) the financial condition of the Borrower or any Subsidiary
Guarantor.  Except as otherwise
specifically provided herein, the Administrative Agent shall have no duty to
disclose to the Lenders information that is not required to be furnished by the
Borrower to the Administrative Agent at such time, but is voluntarily furnished
by the Borrower to the Administrative Agent (either in its capacity as
Administrative Agent or in its individual capacity).

 

10.5                 Action on Instructions of
Lenders.  The Agent shall in all cases
be fully protected in acting, or in refraining from acting, hereunder and under
any other Loan Document in accordance with written instructions signed by the
Required Lenders, and such instructions and any action taken or failure to act
pursuant thereto shall be binding on all of the Lenders.  The Lenders hereby acknowledge that the
Administrative Agent shall be under no duty to take any discretionary action
permitted to be taken by it pursuant to the provisions of this Agreement or any
other Loan Document unless it shall be requested in writing to do so by the
Required Lenders.  The Administrative
Agent shall be fully justified in failing or refusing to take any action
hereunder and under any other Loan Document unless it shall first be
indemnified to its satisfaction by the Lenders pro rata against any and all
liability, cost and expense that it may incur by reason of taking or continuing
to take any such action.

 

10.6                 Employment of Agents and
Counsel.  The Administrative Agent may
execute any of its duties as Administrative Agent hereunder and under any other
Loan Document by or through employees, agents, and attorneys-in-fact and shall
not be answerable to the Lenders, except as to money or securities received by
it or its authorized agents, for the default or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care.  The Administrative Agent shall be entitled to
advice of counsel concerning all matters pertaining to the agency hereby
created and its duties hereunder and under any other Loan Document.

 

10.7                 Reliance on Documents;
Counsel.  The Administrative Agent shall
be entitled to rely upon any Note, notice, consent, certificate, affidavit,
letter, telegram, statement, paper or document believed by it to be genuine and
correct and to have been signed or sent by the proper person or persons, and,
in respect to legal matters, upon the opinion of counsel selected by the
Administrative Agent, which counsel may be employees of the Administrative
Agent.

 

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10.8                 Administrative Agent’s
Reimbursement and Indemnification.  The Lenders agree to reimburse and indemnify
the Administrative Agent ratably in proportion to their respective Commitments (i) for
any amounts not reimbursed by the Borrower for which the Administrative Agent
is entitled to reimbursement by the Borrower under the Loan Documents, (ii) for
any other expenses incurred by the Administrative Agent on behalf of the
Lenders, in connection with the preparation, execution, delivery,
administration and enforcement of the Loan Documents, if not paid by Borrower
and (iii) for any liabilities, obligations, losses, damages, penalties,
actions, 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 the Loan
Documents or any other document delivered in connection therewith or the
transactions contemplated thereby (including without limitation, for any such
amounts incurred by or asserted against the Administrative Agent in connection
with any dispute between the Administrative Agent and any Lender or between two
or more of the Lenders), or the enforcement of any of the terms thereof or of
any such other documents, provided that no Lender shall be liable for any of
the foregoing to the extent they arise from the gross negligence or willful
misconduct or a breach of the Administrative Agent’s express obligations and
undertakings to the Lenders which is not cured after written notice and within
the period described in Section 10.3, The obligations of the
Lenders and the Administrative Agent under this Section 10.8 shall
survive payment of the Obligations and termination of this Agreement.

 

10.9                 Rights as a Lender.  In the event the Administrative Agent is a
Lender, the Administrative Agent shall have the same rights and powers
hereunder and under any other Loan Document as any Lender and may exercise the
same as though it were not the Administrative Agent, and the term “Lender” or “Lenders”
shall, at any time when the Administrative Agent is a Lender, unless the
context otherwise indicates, include the Administrative Agent in its individual
capacity.  The Administrative Agent may
accept deposits from, lend money to, and generally engage in any kind of trust,
debt, equity or other transaction, in addition to those contemplated by this
Agreement or any other Loan Document, with the Borrower or any of its
Subsidiaries in which the Borrower or such Subsidiary is not restricted hereby
from engaging with any other Person.  The
Administrative Agent, in its individual capacity, is not obligated to remain a
Lender.

 

10.10               Lender Credit Decision.  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 decision to enter into this Agreement and the other Loan
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
taking or not taking action under this Agreement and the other Loan Documents.

 

10.11               Successor Administrative
Agent.  Except as otherwise provided
below, KeyBank National Association shall at all times serve as the
Administrative Agent during the term of this Facility.  The Administrative Agent may resign at any
time by giving written notice thereof to the Lenders and the Borrower, such
resignation to be effective upon the appointment of a successor Administrative
Agent or, if no successor Administrative Agent has been appointed, forty-five
days after the retiring Administrative Agent gives notice of its intention to
resign.  The Administrative Agent may be
removed at any time with cause by written notice received by the Administrative
Agent from all Lenders holding 66 2/3% of that portion of the Aggregate
Commitment not held by the Administrative Agent, such removal to be effective
on the date specified by the other Lenders. 
Upon any such resignation or removal, the Required Lenders shall have the
right to appoint, on behalf of the Borrower and the Lenders, a successor
Administrative Agent.  If no successor 

 

62

 

Administrative Agent shall have been so
appointed by the Required Lenders within thirty days after the resigning
Administrative Agent’s giving notice of its intention to resign, then the
resigning Administrative Agent may appoint, on behalf of the Borrower and the
Lenders, a successor Administrative Agent. 
Notwithstanding the previous sentence, the Administrative Agent may at
any time without the consent of the Borrower or any Lender, appoint any of its
Affiliates which is a commercial bank as a successor Administrative Agent
hereunder.  If the Administrative Agent
has resigned or been removed and no successor Administrative Agent has been
appointed, the Lenders may perform all the duties of the Administrative Agent
hereunder and the Borrower shall make all payments in respect of the
Obligations to the applicable Lender and for all other purposes shall deal
directly with the Lenders.  No successor
Administrative Agent shall be deemed to be appointed hereunder until such
successor Administrative Agent has accepted the appointment.  Any such successor Administrative Agent shall
be a commercial bank having capital and retained earnings of at least
$500,000,000.  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
resigning or removed Administrative Agent. 
Upon the effectiveness of the resignation or removal of the
Administrative Agent, the resigning or removed Administrative Agent shall be
discharged from its duties and obligations hereunder and under the Loan
Documents.  After the effectiveness of
the resignation or removal of an Administrative Agent, the provisions of this Article X
shall continue in effect for the benefit of such Administrative Agent in
respect of any actions taken or omitted to be taken by it while it was acting
as the Administrative Agent hereunder and under the other Loan Documents.

 

10.12               Notice of Defaults.  If a Lender becomes aware of a Default or
Unmatured Default, such Lender shall notify the Administrative Agent of such
fact provided that the failure to give such notice shall not create liability
on the part of a Lender.  Upon receipt of
such notice that a Default or Unmatured Default has occurred, the
Administrative Agent shall notify each of the Lenders of such fact.

 

10.13               Requests for Approval.  If the Administrative Agent requests in
writing the consent or approval of a Lender, such Lender shall respond and
either approve or disapprove definitively in writing to the Administrative
Agent within ten (10) Business Days (or sooner if such notice specifies a
shorter period for responses based on Administrative Agent’s good faith
determination that circumstances exist warranting its request for an earlier
response) after such written request from the Administrative Agent.
Notwithstanding anything to the contrary contained herein, the failure of a
Lender to respond with such a written approval or disapproval within such time
period shall not result in such Lender becoming a Defaulting Lender.

 

10.14               Defaulting Lenders.  At such time as a Lender becomes a Defaulting
Lender, such Defaulting Lender’s right to vote on matters which are subject to
the consent or approval of the Required Lenders, each affected Lender or all
Lenders shall be immediately suspended until such time as the Lender is no
longer a Defaulting Lender, except that the amount of the Commitment of the
Defaulting Lender may not be changed without its consent.  If a Defaulting Lender has failed to fund its
pro rata share of any Advance and until such time as such Defaulting Lender
subsequently funds its pro rata share of such Advance, all Obligations owing to
such Defaulting Lender hereunder shall be subordinated in right of payment, as
provided in the following sentence, to the prior payment in full of all
principal of, interest on and fees relating to the Loans funded by the other
Lenders in connection with any such Advance in which the Defaulting Lender has
not funded its pro rata share (such principal, interest and fees being referred
to as “Senior Loans” for the purposes of this section).  All amounts paid by the Borrower or the
Guarantor and otherwise due to be applied to the Obligations owing to such
Defaulting Lender pursuant to the terms hereof shall be distributed by the
Administrative Agent to the other Lenders in accordance with their respective
pro rata shares 

 

63

 

(recalculated for the purposes hereof to
exclude the Defaulting Lender) until all Senior Loans have been paid in
full.  After the Senior Loans have been
paid in full equitable adjustments will be made in connection with future
payments by the Borrower to the extent a portion of the Senior Loans had been
repaid with amounts that otherwise would have been distributed to a Defaulting
Lender but for the operation of this Section 10.14.  This provision governs only the relationship
among the Administrative Agent, each Defaulting Lender and the other Lenders;
nothing hereunder shall limit the obligation of the Borrower to repay all Loans
in accordance with the terms of this Agreement. 
The provisions of this section shall apply and be effective regardless
of whether a Default occurs and is continuing, and notwithstanding (i) any
other provision of this Agreement to the contrary, (ii) any instruction of
the Borrower as to its desired application of payments or (iii) the
suspension of such Defaulting Lender’s right to vote on matters which are
subject to the consent or approval of the Required Lenders or all Lenders.

 

ARTICLE
XI

 

SETOFF; RATABLE PAYMENTS

 

11.1                 Setoff.  In addition to, and without limitation of,
any rights of the Lenders under applicable law, if the Borrower becomes
insolvent, however evidenced, or any Default occurs, any and all deposits
(including all account balances, whether provisional or final and whether or
not collected or available) and any other Indebtedness at any time held or
owing by any Lender or any of its Affiliates to or for the credit or account of
the Borrower may be offset and applied toward the payment of the Obligations
owing to such Lender at any time prior to the date that such Default has been
fully cured, whether or not the Obligations, or any part hereof, shall then be
due.

 

11.2                 Ratable Payments.  If any Lender, whether by setoff or
otherwise, has payment made to it upon its Loans (other than payments received
pursuant to Sections 3.1, 3.2, 3.4 or 3.5) in a
greater proportion than that received by any other Lender, such Lender agrees,
promptly upon demand, to purchase a portion of the Loans held by the other
Lenders so that after such purchase each Lender will hold its ratable
proportion of Loans.  If any Lender,
whether in connection with setoff or amounts which might be subject to setoff
or otherwise, receives collateral or other protection for its Obligations or
such amounts which may be subject to setoff, such Lender agrees, promptly upon
demand, to take such action necessary such that all Lenders share in the
benefits of such collateral ratably in proportion to their Loans.  In case any such payment is disturbed by
legal process, or otherwise, appropriate further adjustments shall be made.

 

ARTICLE
XII

 

BENEFIT OF AGREEMENT;
ASSIGNMENTS; PARTICIPATIONS

 

12.1                 Successors and Assigns.  The terms and provisions of the Loan Documents
shall be binding upon and inure to the benefit of the Borrower and the Lenders
and their respective successors and assigns, except that (i) the Borrower
shall not have the right to assign its rights or obligations under the Loan
Documents and (ii) any assignment by any Lender must be made in compliance
with Section 12.3.  The
parties to this Agreement acknowledge that clause (ii) of this Section 12.1
relates only to absolute assignments and does not prohibit assignments creating
security interests, including, without limitation, (x) any pledge or
assignment by any Lender of all or any portion of its rights under this
Agreement and any Note to a Federal Reserve Bank or (y) in the case of a
Lender which is a fund, any pledge or assignment of all or any portion of its
rights under this 

 

64

 

Agreement and any Note to its trustee in
support of its obligations to its trustee; provided, however, that
no such pledge or assignment creating a security interest shall release the
transferor Lender from its obligations hereunder unless and until the parties
thereto have complied with the provisions of Section 12.3.  The Administrative Agent may treat the Person
which made any Loan or which holds any Note as the owner thereof for all
purposes hereof unless and until such Person complies with Section 12.3;
provided, however, that the
Administrative Agent may in its discretion (but shall not be required to)
follow instructions from the Person which made any Loan or which holds any Note
to direct payments relating to such Loan or Note to another Person.  Any assignee of the rights to any Loan or any
Note agrees by acceptance of such assignment to be bound by all the terms and
provisions of the Loan Documents.  Any
request, authority or consent of any Person, who at the time of making such
request or giving such authority or consent is the owner of the rights to any
Loan (whether or not a Note has been issued in evidence thereof), shall be
conclusive and binding on any subsequent holder or assignee of the rights to
such Loan.

 

12.2                 Participations.

 

12.2.1      Permitted
Participants; Effect.  Any Lender may, in the ordinary course of its
business and in accordance with applicable law, at any time sell to one or more
banks, financial institutions, pension funds, or any other funds or entities (“Participants”)
participating interests in any Loan owing to such Lender, any Note held by such
Lender, any Commitment of such Lender or any other interest of such Lender
under the Loan Documents.  In the event
of any such sale by a Lender of participating interests to a Participant, such
Lender’s obligations under the Loan Documents shall remain unchanged, such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, such Lender shall remain the holder of any
such Note for all purposes under the Loan Documents, all amounts payable by the
Borrower under this Agreement shall be determined as if such Lender had not
sold such participating interests, and the Borrower and the Administrative
Agent shall continue to deal solely and directly with such Lender in connection
with such Lender’s rights and obligations under the Loan Documents.

 

12.2.2      Voting
Rights.  Each Lender shall retain the sole right to approve,
without the consent of any Participant, any amendment, modification or waiver
of any provision of the Loan Documents other than any amendment, modification
or waiver with respect to any Loan or Commitment in which such Participant has
an interest which would require consent of all the Lenders pursuant to the
terms of Section 8.2 or of any other Loan Document.

 

12.2.3      Benefit
of Setoff.  The Borrower agrees that each Participant
which has previously advised the Borrower in writing of its purchase of a
participation in a Lender’s interest in its Loans shall be deemed to have the
right of setoff provided in Section 11.1 in respect of its
participating interest in amounts owing under the Loan Documents to the same
extent as if the amount of its participating interest were owing directly to it
as a Lender under the Loan Documents. 
Each Lender shall retain the right of setoff provided in Section 11.1
with respect to the amount of participating interests sold to each Participant,
provided that such Lender and Participant may not each setoff amounts against
the same portion of the Obligations, so as to collect the same amount from the
Borrower twice.  The Lenders agree to
share with each Participant, and each Participant, by exercising the right of
setoff provided in Section 11.1, agrees to share with each Lender,
any amount received pursuant to the exercise of its right of setoff, such
amounts to be shared in accordance with Section 11.2 as if each
Participant were a Lender.

 

65

 

12.3                 Assignments.

 

12.3.1      Permitted
Assignments.  Any Lender may, in the ordinary course of its
business and in accordance with applicable law, at any time assign to any
Eligible Assignee all or any portion (greater than or equal to $10,000,000 for
each assignee, so long as the hold position of the assigning Lender is not less
than $10,000,000) of its rights and obligations under the Loan Documents.  Such assignment shall be substantially in the
form of Exhibit D hereto or in such other form as may be agreed to
by the parties thereto.  The consent of
the Administrative Agent shall be required prior to an assignment becoming
effective with respect to an Eligible Assignee which is not a Lender or an Affiliate
thereof.  Such consent shall not be
unreasonably withheld.

 

12.3.2      Effect;
Effective Date.  Upon (i) delivery to the Administrative
Agent of a notice of assignment, substantially in the form attached as Exhibit “I”
to Exhibit D hereto (a “Notice of Assignment”), together
with any consents required by Section 12.3.1, and (ii) payment
of a $3,500 fee by the assignor or assignee to the Administrative Agent for
processing such assignment, such assignment shall become effective on the
effective date specified in such Notice of Assignment.  The Notice of Assignment shall contain a
representation by the Eligible Assignee to the effect that none of the
consideration used to make the purchase of the Commitment and Loans under the
applicable assignment agreement are “plan assets” as defined under ERISA and
that the rights and interests of the Eligible Assignee in and under the Loan
Documents will not be “plan assets” under ERISA.  On and after the effective date of such
assignment, such Eligible Assignee shall for all purposes be a Lender party to
this Agreement and any other Loan Document executed by the Lenders and shall
have all the rights and obligations of a Lender under the Loan Documents, to
the same extent as if it were an original party hereto, and no further consent
or action by the Borrower, the Lenders or the Administrative Agent shall be
required to release the transferor Lender, and the transferor Lender shall
automatically be released on the effective date of such assignment, with
respect to the percentage of the Aggregate Commitment and Loans assigned to
such Eligible Assignee.  Upon the
consummation of any assignment to a Eligible Assignee pursuant to this Section 12.3.2,
the transferor Lender, the Administrative Agent and the Borrower shall make
appropriate arrangements so that replacement Notes are issued to such
transferor Lender and new Notes or, as appropriate, replacement Notes, are
issued to such Eligible Assignee, in each case in principal amounts reflecting
their Commitment, as adjusted pursuant to such assignment.

 

12.4                 Dissemination of Information.  The Borrower authorizes each Lender to
disclose to any Participant or Eligible Assignee or any other Person acquiring
an interest in the Loan Documents by operation of law (each a “Transferee”)
and any prospective Transferee any and all information in such Lender’s
possession concerning the creditworthiness of the Borrower and its
Subsidiaries, subject to Section 9.11 of this Agreement.

 

12.5                 Tax Treatment.  If any interest in any Loan Document is
transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the transferor
Lender shall cause such Transferee, concurrently with the effectiveness of such
transfer, to comply with the provisions of Section 3.5.

 

66

 

ARTICLE
XIII

 

NOTICES

 

13.1                 Giving Notice.  Except as otherwise permitted by Section 2.14
with respect to borrowing notices, all notices and other communications
provided to any party hereto under this Agreement or any other Loan Document
shall be in writing or by telex or by facsimile and addressed or delivered to
such party at its address set forth below its signature hereto or at such other
address (or to counsel for such party) as may be designated by such party in a
notice to the other parties.  Any notice,
if mailed and properly addressed with postage prepaid, shall be deemed given
when received; any notice, if transmitted by telex or facsimile, shall be
deemed given when transmitted (answerback confirmed in the case of telexes).

 

13.2                 Change of Address.  The Borrower, the Administrative Agent and
any Lender may each change the address for service of notice upon it by a
notice in writing to the other parties hereto.

 

ARTICLE
XIV

 

COUNTERPARTS

 

This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one agreement, and
any of the parties hereto may execute this Agreement by signing any such
counterpart.  This Agreement shall be
effective when it has been executed by the Borrower and the Lenders and each party
has notified the Administrative Agent by telex or telephone, that it has taken
such action.

 

(Remainder
of page intentionally left blank.)

 

67

 

IN WITNESS WHEREOF, the Borrower and the Lenders,
individually and in their respective capacities as Agents, have executed this
Agreement as of the date first above written.

 

 

	
   

  	
   

  	
  INLAND REAL
  ESTATE CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Brett A. Brown

  
	
   

  	
   

  	
  Print Name:

  	
  Brett A. Brown

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  2901 Butterfield
  Road

  
	
   

  	
   

  	
  Oak Brook,
  Illinois

  
	
   

  	
   

  	
  Phone:
  630-218-7351

  
	
   

  	
   

  	
  Facsimile:
  630-218-7350

  
	
   

  	
   

  	
  Attention: Mark
  E. Zalatoris

  
	
   

  	
   

  	
  zalatoris@inlandrealestate.com

  
						

 

S-1

 

	
  COMMITMENTS:

  	
   

  	
  KEYBANK NATIONAL
  ASSOCIATION,

  
	
  $35,000,000

  	
   

  	
  Individually and
  as Administrative Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Kevin P. Murray

  
	
   

  	
   

  	
  Print Name:

  	
  Kevin P. Murray

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  127 Public Square, 8th Floor

  
	
   

  	
   

  	
  OH-01-27-0839

  
	
   

  	
   

  	
  Cleveland, Ohio 44114

  
	
   

  	
   

  	
  Phone: 216-689-4660

  
	
   

  	
   

  	
  Facsimile: 216-689-3566

  
	
   

  	
   

  	
  Attention: Kevin Murray

  
	
   

  	
   

  	
  Kevin_P_Murray@KeyBank.com

  
	
  With a copy to:

  	
   

  	
   

  
	
   

  	
   

  	
  KeyBank National Association

  
	
   

  	
   

  	
  800 Superior, 6th Floor

  
	
   

  	
   

  	
  Cleveland, Ohio 44114

  
	
   

  	
   

  	
  Phone: 216-828-7512

  
	
   

  	
   

  	
  Facsimile: 216-828-7523

  
	
   

  	
   

  	
  Attention: Vicki Heineck

  
						

 

S-2

 

	
  COMMITMENT:

  	
   

  	
  WACHOVIA BANK, NATIONAL ASSOCIATION

  
	
  $35,000,000

  	
   

  	
  Individually and as
  Syndication Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Cathy A. Casey

  
	
   

  	
   

  	
  Cathy A. Casey

  
	
   

  	
   

  	
  Managing Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Wachovia Capital Markets

  
	
   

  	
   

  	
  301 South College Street NC 0172, 16th Floor

  
	
   

  	
   

  	
  Charlotte, NC 28202

  
	
   

  	
   

  	
  Phone: (704) 383-6787

  
	
   

  	
   

  	
  Facsimile: (704) 715-0065

  
	
   

  	
   

  	
  Attention: Karen Berka

  
	
   

  	
   

  	
  Karen.berka@wachovia.com

  
	
   

  	
   

  	
   

  
	
  With a copy to:  

  	
  Wachovia

  
	
   

  	
   

  	
  1525 W. WT Harris Blvd.

  
	
   

  	
   

  	
  Charlotte, NC 28262

  
	
   

  	
   

  	
  Phone: (704) 590-3325

  
	
   

  	
   

  	
  Facsimile: (704) 715-0099

  
	
   

  	
   

  	
  Attention: Andrew Gadson

  
	
   

  	
   

  	
  Andrew.gadson@wachovia.com

  

 

S-3

 

	
  COMMITMENT:

  	
   

  	
  BANK OF AMERICA, N.A.

  
	
  $35,000,000

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Susan Vercauteren

  
	
   

  	
   

  	
  Susan Vercauteren

  
	
   

  	
   

  	
  Senior Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  101 South Tryon Street

  
	
   

  	
   

  	
  NC1-002-33-87

  
	
   

  	
   

  	
  Charlotte, NC 28255

  
	
   

  	
   

  	
  Phone: (704) 386-6994

  
	
   

  	
   

  	
  Facsimile: (704) 386-6434

  
	
   

  	
   

  	
  Attention: Linda J. Frixen

  
	
   

  	
   

  	
  Linda.j.frixen@bankofamerica.com

  

 

S-4

 

	
  COMMITMENT:

  	
   

  	
  WELLS FARGO BANK, NATIONAL ASSOCIATION

  
	
  $30,000,000

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Marla S. Bergrin

  
	
   

  	
   

  	
  Marla S. Bergrin

  
	
   

  	
   

  	
  Assistant Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Chicago, IL 60606

  
	
   

  	
   

  	
  Phone: (312) 827-1554

  
	
   

  	
   

  	
  Facsimile: (312) 782-0969

  
	
   

  	
   

  	
  Attention: Amanda Mayer

  
	
   

  	
   

  	
  amanda.m.meyer@wellsfargo.com

  

 

S-5

 

	
  COMMITMENT:

  	
   

  	
  BMO CAPITAL MARKETS FINANCING, INC.

  
	
  $20,000,000

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Aaron Lanski

  
	
   

  	
   

  	
  Aaron Lanski

  
	
   

  	
   

  	
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  111 West Monroe Street, 10W

  
	
   

  	
   

  	
  Chicago, IL 60603

  
	
   

  	
   

  	
  Phone:   (312) 461-6364

  
	
   

  	
   

  	
  Facsimile: (312) 293-5068

  
	
   

  	
   

  	
  Attention: Aaron Lanski

  
	
   

  	
   

  	
  aaron.lanski@bmo.com

  

 

S-6

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