Document:

<B><P ALIGN="RIGHT">Exhibit 10.1</P>
</B><P ALIGN="CENTER">$750,000,000</P>
<P ALIGN="CENTER">CHARTER COMMUNICATIONS, INC. <BR>
</P>
<P ALIGN="CENTER"><BR>
5.875% CONVERTIBLE SENIOR NOTES DUE 2009<BR>
<BR>
<BR>
PURCHASE AGREEMENT</P>
<P ALIGN="CENTER">Dated November 16, 2004</P>
<P ALIGN="JUSTIFY"></P>

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<HR WIDTH="85%">
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<P>November 16, 2004</P>
<P>Citigroup Global Markets Inc.<br>
Morgan Stanley &amp; Co. Incorporated <br>
As Representatives of the Purchasers <BR>
   c/o Citigroup Global Markets Inc.<br>
388 Greenwich St. <BR>
New York, New York 10013</P>
<P>Ladies and Gentlemen:</P>
<P>Charter Communications, Inc, a corporation organized under the laws of
Delaware (the &quot;Issuer&quot;), proposes to issue and sell to the several
parties named in Schedule I hereto (the &quot;Purchasers&quot;), for whom you
(the &quot;Representatives&quot;) are acting as representatives, $750,000,000
original principal amount of its 5.875% Convertible Notes Due 2009 (the
&quot;Firm Securities&quot;). The Issuer also proposes to grant to the
Purchasers an option to purchase up to $112,500,000 additional original
principal amount of such Securities (the &quot;Option Securities&quot; and,
together with the Firm Securities, the &quot;Securities&quot;) solely for the
purpose of covering over-allotments.  The Securities are convertible into shares
of Class A Common Stock, par value $.001 per share (the &quot;Common
Stock&quot;) of the Issuer at the conversion price set forth herein (as so
converted, the &quot;Converted Common Stock&quot;). The Securities are to be
issued under an indenture (the &quot;Indenture&quot;), to be dated as of the
Time of Delivery, between the Issuer and Wells Fargo Bank, N.A., as trustee (the
&quot;Trustee&quot;). The Securities will have the benefit of a registration
rights agreement (the &quot;144A Registration Rights Agreement&quot;), to be
dated as of the Time of Delivery, between the Issuer and the Purchasers,
pursuant to which the Issuer will agree to register the resale of the Securities
and the Converted Common Stock under the Act subject to the terms and conditions
therein specified.  The Securities will also have the benefit of a pledge of
treasury securities by Charter Communications Holding Company, LLC to the Issuer
(the &quot;Holdings Pledge Agreement&quot;) and a subsequent pledge of such
treasury securities by the Issuer to the Collateral Agent (the &quot;Issuer
Pledge Agreement&quot;).  To the extent there are no additional parties listed
on Schedule I other than you, the term Representatives as used herein shall mean
you as the Purchasers, and the terms Representatives and Purchasers shall mean
either the singular or plural as the context requires. </P>
<P>The Issuer further proposes to enter into a Share Lending Agreement between
the Issuer, Citigroup Global Markets Limited and Citigroup Global Markets Inc.,
as agent (the &quot;Share Lending Agreement&quot;), pursuant to which the Issuer
will lend shares of Common Stock to Citigroup Global Markets Limited (the
&quot;Borrowed Common Stock&quot;).  The Borrowed Common Stock will have the
benefit of a registration rights agreement to be dated as of the Time of
Delivery, between the Issuer and Citigroup Global Markets Inc., pursuant to
which the Issuer will agree to register the sale of the Borrowed Common Stock
under the Act (the &quot;Borrowed Stock Registration Rights Agreement.&quot;).
</P>
<P>We collectively refer to this Agreement, the Indenture, the 144A Registration
Rights Agreement, the Holdings Pledge Agreement, the Issuer Pledge Agreement,
the Stock Lending Agreement and the Borrowed Stock Registration Rights Agreement
as the &quot;Transaction Documents.&quot;  </P>
<P>The sale of the Securities to the Purchasers will be made without
registration of the Securities or the Converted Common Stock under the Act in
reliance upon exemptions from the registration requirements of the Act.</P>
<P>In connection with the sale of the Securities, the Issuer has prepared an
offering memorandum, dated November 16, 2004 (the &quot;<U>Offering
Memorandum</U>&quot;).  The Offering Memorandum sets forth certain information
concerning the Issuer and its subsidiaries, the Securities and the Converted
Common Stock.  The Issuer hereby confirms that it has authorized the use of the
Offering Memorandum, and any amendment or supplement thereto, in connection with
the offer and sale of the Securities by the Purchasers.</P>
<OL>

<OL>

<LI><U>Representations and Warranties of the Issuer</U>.  The Issuer represents
and warrants to, and agrees with, each of the Purchasers that:</LI>
<OL TYPE="a">

<LI>The Offering Memorandum and any amendments or supplements thereto does not
and will not, as of their respective dates, contain an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information relating to the Purchasers furnished in writing to
the Issuer by or on behalf of a Purchaser through the Representative expressly
for use therein;</LI>
<LI>None of the Issuer or any of its subsidiaries has sustained since the date
of the latest audited financial statements included in the Offering Memorandum
any material loss or interference with its business from fire, explosion, flood
or other calamity, whether or not covered by insurance, or from any court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Offering Memorandum; and, since the respective dates as of
which information is given in the Offering Memorandum, there has not been any
change in the capital stock or limited liability company interests or long-term
debt of the Issuer or any of its subsidiaries or any material adverse change, or
any development involving a prospective material adverse change, in or affecting
the general affairs, management, financial position, members' or stockholders'
equity or results of operations of the Issuer's subsidiaries, taken as a whole,
otherwise than as set forth or contemplated in the Offering Memorandum;</LI>
<LI>The Issuer and each of its subsidiaries has good and marketable title to all
real property and good and valid title to all personal property owned by it
reflected as owned in the financial statements included in the Offering
Memorandum, in each case free and clear of all liens, encumbrances and defects
except such as are described in the Offering Memorandum or except such as do not
materially affect the value of such property and do not interfere with the use
made and proposed to be made of such property by the Issuer and its
subsidiaries; and any real property and buildings held under lease by the Issuer
and its subsidiaries are held by them under valid, subsisting and enforceable
leases with such exceptions as are not material and do not interfere with the
use made and proposed to be made of such property and buildings by the Issuer
and its subsidiaries;</LI>
<LI>The Issuer has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, and has
power and authority to own its properties and conduct its business as described
in the Offering Memorandum and to execute, deliver and perform its obligations
under this Agreement, and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties or conducts any business so
as to require such qualification; and is not subject to liability or disability
by reason of the failure to be so qualified in any such jurisdiction, except
such as would not, individually or in the aggregate, have a material adverse
effect on the current or future financial position, stockholders' equity or
results of operations of the Issuer and the Issuer's subsidiaries, taken as a
whole (a &quot;<U>Material Adverse Effect</U>&quot;); each of the Issuer's
subsidiaries has been duly incorporated or formed, as the case may be, and is
validly existing as a corporation, partnership or limited liability company, as
the case may be, in good standing under the laws of its jurisdiction of
incorporation or formation, in each case except such as would, individually or
in the aggregate, not result in a Material Adverse Effect;</LI>
<LI>All the outstanding capital stock, limited liability company interests or
partnership interests, as the case may be, of the Issuer and each
&quot;significant subsidiary&quot; (as such term is defined in Rule 1-02 of
Regulation S-X) of the Issuer (each a &quot;<U>Significant Subsidiary</U>&quot;)
have been duly and validly authorized and issued, are fully paid and
nonassessable and (except as otherwise set forth in the Offering Memorandum) are
owned directly or indirectly by the Issuer, free and clear of all liens,
encumbrances, equities or claims;</LI>
<FONT FACE="TimesNewRoman"><LI>The Issuer's authorized equity capitalization is
as set forth or incorporated by reference in the Offering Memorandum; the
capital stock of the Issuer conforms to the description thereof contained or
incorporated by reference in the Offering Memorandum; the outstanding shares of
Common Stock have been duly authorized and validly issued and are fully paid and
nonassessable; the shares of Converted Common Stock have been duly authorized
and, when issued upon conversion of the Securities against payment of the
conversion price in accordance with the terms of the Indenture and the
Securities, will be validly issued, fully paid and nonassessable; the Board of
Directors of the Issuer has duly and validly adopted resolutions reserving such
shares of Converted Common Stock for issuance upon conversion of the Securities;
the shares of Borrowed Common Stock have been duly authorized and, when issued
upon payment of the Loan Fee (as defined in the Share Lending Agreement) in
accordance with the terms of the Share Lending Agreement, will be validly
issued, fully paid and nonassessable; the Board of Directors of the Issuer has
duly and validly adopted resolutions reserving such shares of Borrowed Common
Stock for issuance upon payment of the Loan Fee in accordance with the terms of
the Share Lending Agreement; the holders of outstanding shares of capital stock
of the Issuer are not entitled to preemptive or other rights to subscribe for
the Securities or the shares of Converted Common Stock or Borrowed Common Stock;
and, except as set forth in the Offering Memorandum, no options, warrants or
other rights to purchase, agreements or other obligations to issue, or rights to
convert any obligations into or exchange any securities for, shares of capital
stock of or ownership interests in the Issuer are outstanding;</LI>
</FONT><LI>This Agreement has been duly authorized and executed by the
Issuer;</LI>
<LI>The Securities have been duly authorized and, when executed by the Issuer
and authenticated by the Trustee in accordance with the provisions of the
Indenture and when delivered to, and paid for, by the Purchasers in accordance
with the terms of this Agreement, will have been duly executed, authenticated,
issued and delivered and will constitute valid and legally binding obligations
of the Issuer entitled to the benefits provided by the Indenture under which
they are to be issued and enforceable against the Issuer in accordance with
their terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or affecting
creditors' rights and to general equity principles and will be convertible into
Common Stock in accordance with their terms;</LI>
<LI>The Indenture has been duly authorized, and when executed and delivered by
the Issuer (assuming the due execution and delivery thereof by the Trustee),
will constitute a valid and legally binding instrument, enforceable against the
Issuer in accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability relating to
or affecting creditors' rights and to general equity principles; the Indenture
meets the requirements for qualification under the United States Trust Indenture
Act of 1939, as amended (the &quot;<U>Trust Indenture Act</U>&quot;); and the
Indenture conforms in all<SUB>. </SUB>material respects to the descriptions
thereof in the Offering Memorandum;</LI>
<LI>The 144A Registration Rights Agreement has been duly authorized by the
Issuer and, when executed and delivered by the Issuer (assuming the due
authorization, execution and delivery thereof by the other parties thereto),
will constitute the legal, valid and binding obligation of the Issuer,
enforceable against the Issuer in accordance with its terms (subject, as to
enforcement, to applicable bankruptcy, reorganization, insolvency, moratorium or
other laws affecting creditors' rights generally from time to time in effect and
to general  equitable principles, whether arising in equity or at law);</LI>
<LI>The Stock Lending Agreement has been duly authorized by the Issuer and, when
executed and delivered by the Issuer (assuming the due authorization, execution
and delivery thereof by the other parties thereto), will constitute the legal,
valid and binding obligation of the Issuer, enforceable against the Issuer in
accordance with its terms (subject, as to enforcement , to applicable
bankruptcy, reorganization, insolvency, moratorium or other laws affecting
creditors' rights generally from time to time in effect and to general equitable
principles, whether arising in equity or at law);<BR>
</LI>
<LI>The Borrowed Stock Registration Rights Agreement has been duly authorized by
the Issuer and, when executed and delivered by the Issuer (assuming the due
authorization, execution and delivery thereof by the other parties thereto),
will constitute the legal, valid and binding obligation of the Issuer,
enforceable against the Issuer in accordance with its terms (subject, as to
enforcement, to applicable bankruptcy, reorganization, insolvency, moratorium or
other laws affecting creditors' rights generally from time to time in effect and
to general equitable principles, whether arising in equity or at law);<BR>
</LI>
<LI>The Holdings Pledge Agreement has been duly authorized by the Issuer and,
when executed and delivered by the Issuer (assuming the due authorization,
execution and delivery thereof by the other parties thereto), will constitute
the legal, valid and binding obligation of the Issuer, enforceable against the
Issuer in accordance with its terms (subject, as to enforcement, to applicable
bankruptcy, reorganization, insolvency, moratorium or other laws affecting
creditors' rights generally from time to time in effect and to general equitable
principles, whether arising in equity or at law);</LI>
<LI>The Issuer Pledge Agreement has been duly authorized by the Issuer and, when
executed and delivered by the Issuer (assuming the due authorization, execution
and delivery thereof by the other parties thereto), will constitute the legal,
valid and binding obligation of the Issuer, enforceable against the Issuer in
accordance with its terms (subject, as to enforcement, to applicable bankruptcy,
reorganization, insolvency, moratorium or other laws affecting creditors' rights
generally from time to time in effect and to general equitable principles,
whether arising in equity or at law);</LI>
<LI>None of the transactions contemplated by this Agreement (including, without
limitation, the use of the proceeds from the sale of the Securities) will
violate or result in a violation of Section 7 of the Securities Exchange Act of
1934, as amended (the &quot;<U>Exchange Act</U>&quot;), or any regulation
promulgated thereunder, including, without limitation, Regulations T, U, and X
of the Board of Governors of the Federal Reserve System;</LI>
<LI>Prior to the date hereof, none of the Issuer or any of its affiliates has
taken any action which is designed to or which has constituted or which might
have been expected to cause or result in stabilization or manipulation of the
price of any security of the Issuer in connection with the offering of the
Securities.</LI>
<LI>The issue and sale of the Securities, the issuance of the Converted Common
Stock and the Borrowed Common Stock and the compliance by the Issuer with all
provisions of the Securities and the Transaction Documents and the consummation
of the transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement, lease, license, franchise agreement, permit or other agreement or
instrument to which the Issuer any of the Issuer's subsidiaries is a party or by
which the Issuer or any of the Issuer's subsidiaries is bound or to which any of
the property or assets of the Issuer or any of the Issuer's subsidiaries is
subject, nor will such action result in any violation of any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Issuer or any of the Issuer's subsidiaries or any of their
properties, including, without limitation, the Securities Act of 1933, as
amended, (the &quot;Act&quot;), the Communications Act of 1934, as amended, the
Cable Communications Policy Act of 1984, as amended, the Cable Television
Consumer Protection and Competition Act of 1992, as amended, and the
Telecommunications Act of 1996 (collectively, the &quot;<U>Cable
Acts</U>&quot;), any order, rule or regulation of the Federal Communications
Commission (the &quot;<U>FCC</U>&quot;), or the Order Instituting Cease and
Desist Proceedings, Making Findings, and Imposing a Cease and Desist Order
Pursuant to Section 21C of the Securities and Exchange Act of 1934, dated July
27, 2004, issued In the Matter of Charter Communications, Inc., except where
such conflicts, breaches, violations or defaults would not, individually or in
the aggregate, have a Material Adverse Effect and would not have the effect of
preventing the Issuer from performing any of its respective obligations under
the Securities or the Transaction Documents; nor will such action result in any
violation of the certificate of incorporation or bylaws of the Issuer; and no
consent, approval, authorization, order, registration or qualification of or
with any such court or governmental agency or body is required, including,
without limitation, under the Cable Acts or any order, rule or regulation of the
FCC, for the issue and sale of the Securities or the consummation by the Issuer
of the transactions contemplated by the Transaction Documents, except such
consents, approvals, authorizations, registrations or qualifications as have
been made or except as may be required under state or foreign securities or Blue
Sky laws in connection with the purchase and distribution of the Securities and
the Converted Common Stock by the Purchasers and the Borrowing of the Borrowed
Shares pursuant to the Share Lending Agreement and except such as will be made
in the case of the 144A Registration Rights Agreement, the Borrowed Share
Registration Rights Agreement or such as may be required by the National
Association of Securities Dealers, Inc. (the &quot;<U>NASD</U>&quot;);</LI>
<LI>None of the Issuer or any of the Issuer's subsidiaries is (i) in violation
of its certificate of incorporation, bylaws, certificate of formation, limited
liability company agreement, partnership agreement or other organizational
document, as the case may be, (ii) in default in the performance or observance
of any obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease, license, permit or other
agreement or instrument to which it is a party or by which it or any of its
properties may be bound or (iii) in violation of the terms of any franchise
agreement, or any law, statute, rule or regulation or any judgment, decree or
order, in any such case, of any court or governmental or regulatory agency or
other body having jurisdiction over the Issuer, the Parent Companies or any of
the Issuer's subsidiaries or any of their properties or assets, including,
without limitation, the Cable Acts or any order, rule or regulation of the FCC,
except, in the case of clauses (ii) and (iii), such as would not, individually
or in the aggregate, have a Material Adverse Effect;</LI>
<LI>The statements set forth in the Offering Memorandum under the caption
&quot;Description of the Notes,&quot; insofar as it purports to constitute a
summary of the terms of the Securities and (i) in the Offering Memorandum under
the captions &quot;Risk Factors,&quot; &quot;Description of the Share Lending
Agreement,&quot; &quot;Description of Certain Indebtedness,&quot; and
&quot;United States Federal Income Considerations;&quot; (ii) in the Annual
Report on Form 10-K for the Year Ended December 31, 2003, under the captions
&quot;Item 1. Business,&quot;  &quot;Item 7. Management's Discussion and
Analysis of Financial Condition and Results of Operation - Liquidity and Capital
Resources,&quot; &quot;Item 10. Directors and Executive Officers of the
Registrant,&quot; &quot;Item 11. Executive Compensation,&quot; &quot;Item 12.
Security Ownership of Certain Beneficial Owners and Management,&quot; and
&quot;Item 13. Certain Relationships and Related Transactions;&quot; and (iii)
in each of the Quarterly Report on Form 10-Q for the Quarter Ended March 31,
2004, the Quarterly Report on Form <BR>
10-Q for the Quarter Ended June 30, 2004 and the Quarterly Report on Form 10-Q
for the Quarter Ended September 30, 2004, in each case under the caption
&quot;Item 2. Liquidity and Capital Resources,&quot; insofar as they purport to
describe the provisions of the laws, documents and arrangements referred to
therein and to the extent not superceded by subsequent disclosure, are accurate
in all material respects;</LI>
<LI>Other than as set forth in the Offering Memorandum, there are no legal or
governmental proceedings (including, without limitation, by the FCC or any
franchising authority) pending to which the Issuer or any of the Issuer's
subsidiaries is a party or of which any property of the Issuer or any of the
Issuer's subsidiaries is the subject which, if determined adversely with respect
to the Issuer or any of the Issuer's subsidiaries, would, individually or in the
aggregate, have a Material Adverse Effect; and, to the best knowledge of the
Issuer and,except as disclosed in the Offering Memorandum, no such proceedings
are threatened or contemplated by governmental authorities or threatened by
others;</LI>
<LI>The Issuer and the Issuer's subsidiaries carries insurance (including,
without limitation, self-insurance) in such amounts and covering such risks as
in the reasonable determination of the Issuer is adequate for the conduct of its
business and the value of its properties;</LI>
<LI>Except as set forth in the Offering Memorandum, there is no strike, labor
dispute, slowdown or work stoppage with the employees of any of the Issuer or
its subsidiaries which is pending or, to the best knowledge of the Issuer,
threatened which would, individually or in the aggregate, have a Material
Adverse Effect;</LI>
<LI>The Securities satisfy the eligibility requirements of Rule 144A(d)(3) under
the Act; </LI>
<LI>The Issuer is not and after giving effect to the offering and sale of the
Securities will not be, an &quot;investment company&quot; or any entity
&quot;controlled&quot; by an &quot;investment company&quot; as such terms are
defined in the U.S. Investment Company Act of 1940, as amended (the
&quot;<U>Investment Company Act</U>&quot;);</LI>
<LI>None of the Issuer or any of its affiliates, nor any person authorized to
act on their behalf (other than the Purchasers, as to whom the Issuer make no
representations) has, directly or indirectly, made offers or sales of any
security, or solicited offers to buy any security, under circumstances that
would require the registration of the Securities, the Converted Common Stock or
the Borrowed Common Stock under the Act;</LI>
<LI>None of the Issuer or any of the Issuer's subsidiaries, or any person
authorized to act on their behalf (other than the Purchasers, as to whom the
Issuer makes no representation) has offered or sold, the Securities by means of
any general solicitation or general advertising within the meaning of Rule
502(c) under the Act or, with respect to Securities sold outside the United
States to non-U.S. persons (as defined in Rule 902 under the Act), by means of
any directed selling efforts within the meaning of Rule 902 under the Act with
respect to the Securities or the Converted Common Stock, the Borrowed Common
Stock and the Issuer, any affiliate of the Issuer and any person authorized to
act on its behalf (other than the Purchasers, as to whom the Issuer makes no
representation) has complied with and will implement the offering restriction
within the meaning of such Rule 902;</LI></OL>

<br>

aa.  Within the preceding six months, none of the Issuer or any other person
authorized to act on its behalf (other than the Purchasers, as to whom the
Issuer make no representation) has offered or sold to any person any Securities,
or any securities of the same or a similar class as the Securities, other than
Securities offered or sold to the Purchasers hereunder.  The Issuer will take
reasonable precautions designed to ensure that any offer or sale, direct or
indirect, in the United States or to any U.S. person (as defined in Rule 902
under the Act) of any Securities or any substantially similar security issued by
the Issuer, within six months subsequent to the date on which the distribution
of the Securities has been completed (as notified to the Issuer by Citigroup
Global Markets Inc.), is made under restrictions and other circumstances
reasonably designed not to affect the status of the offer and sale of the
Securities in the United States and to U.S. persons contemplated by this
Agreement as transactions exempt from the registration provisions of the
Act;<br>
bb.  The consolidated financial statements (including the notes thereto) included
or incorporated by reference in the Offering Memorandum present fairly in all
material respects the respective consolidated financial positions, results of
operations and cash flows of the entities to which they relate at the dates and
for the periods to which they relate and have been prepared in accordance with
U.S. generally accepted accounting principles (&quot;<U>GAAP</U>&quot;) applied
on a consistent basis (except as otherwise noted therein).  The selected
historical financial data in the Offering Memorandum present fairly in all
material respects the information shown therein and, except with respect to the
selected historical financial data for the calendar year ended December 31, 1999
(which has not been restated), have been prepared and compiled on a basis
consistent with the audited financial statements included therein;<br>
cc.  The pro forma financial information included in the Offering Memorandum (i)
complies as to form in all material respects with the applicable requirements of
Regulation S-X for Form S-1 promulgated under the Exchange Act, and (ii) has
been properly computed on the bases described therein; the assumptions used in
the preparation of the pro forma financial information included in the Offering
Memorandum are reasonable and the adjustments used therein are appropriate to
give effect to the transactions or circumstances referred to therein;<br>
dd.  KPMG LLP, who has certified the financial statements included in the
Offering Memorandum, is a firm of independent public accountants as required by
the Act and the rules and regulations of the Securities and Exchange Commission
(the &quot;<U>Commission</U>&quot;) thereunder, based upon representations by
such firm to us;<br>
ee.  The Issuer and the Issuer's subsidiaries own or possess, or can acquire on
reasonable terms, adequate licenses, trademarks, service marks, trade names and
copyrights (collectively, &quot;<U>Intellectual Property</U>&quot;) necessary to
conduct the business now or proposed to be operated by each of them as described
in the Offering Memorandum, except where the failure to own, possess or have the
ability to acquire any Intellectual Property would not, individually or in the
aggregate, have a Material Adverse Effect; and none of the Issuer and the
Issuer's subsidiaries has received any notice of infringement of or conflict
with (and none actually knows of any such infringement of or conflict with)
asserted rights of others with respect to any Intellectual Property which, if
any such assertion of infringement or conflict were sustained would,
individually or in the aggregate, have a Material Adverse Effect;<br>
ff.  Except as described in the Offering Memorandum, the Issuer and the Issuer's
subsidiaries have obtained all consents, approvals, orders, certificates,
licenses, permits, franchises and other authorizations of and from, and have
made all declarations and filings with, all governmental and regulatory
authorities (including, without limitation, the FCC), all self-regulatory
organizations and all courts and other tribunals legally necessary to own,
lease, license and use their respective properties and assets and to conduct
their respective businesses in the manner described in the Offering Memorandum,
except to the extent that the failure to so obtain or file would not,
individually or in the aggregate, have a Material Adverse Effect;<br>
gg.  The Issuer and the Issuer's subsidiaries have filed all necessary federal,
state and foreign income and franchise tax returns required to be filed as of
the date hereof, except where the failure to so file such returns would not,
individually or in the aggregate, have a Material Adverse Effect, and have paid
all taxes shown as due thereon; and there is no tax deficiency that has been
asserted against the Issuer or any of its subsidiaries (other than those which
the amount or validity thereof are currently being challenged in good faith by
appropriate proceedings and with respect to which reserves in conformity with
GAAP have been provided on the books of the relevant entity) that could
reasonably be expected to result, individually or in the aggregate, in a
Material Adverse Effect;<br>
hh.  The Issuer and the Issuer's subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted accounting
principles and to maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences;<br>
ii.  Except as described in the Offering Memorandum:  (i) each of the franchises
held by, or necessary for any operations of, the Issuer and its subsidiaries
that are material to the Issuer and its subsidiaries, taken as a whole, is in
full force and effect, with no material restrictions or qualifications; (ii) to
the best knowledge of the Issuer, no event has occurred which permits, or with
notice or lapse of time or both <SUB>.</SUB>would permit, the revocation or non-
renewal of any such franchises, assuming the filing of timely renewal
applications and the timely payment of all applicable filing and regulatory fees
to the applicable franchising authority, or which would be reasonably likely to
result, individually or in the aggregate, in any other material impairment of
the rights of the Issuer and the Issuer's subsidiaries in such franchises; and
(iii) the Issuer has no reason to believe that any franchise that is material to
the operation of the Issuer and its subsidiaries will not be renewed;<br>
jj.  Each of the programming agreements entered into by, or necessary for any
operations of, the Issuer or its subsidiaries that are material to the Issuer
and its subsidiaries, taken as a whole, is in full force and effect (or in any
cases where the Issuer or its subsidiaries and any suppliers of content are
operating in the absence of an agreement, such content providers and the Issuer
and its subsidiaries provide and receive service in accordance with terms that
have been agreed to or consistently acknowledged or accepted by both parties,
including, without limitation, situations in which providers or suppliers of
content accept regular payment for the provision of such content); and to the
best knowledge of the Issuer, no event has occurred (or with notice of lapse of
time or both would occur) which would be reasonably likely to result in the
early termination or non-renewal of any such programming agreements and which
would, individually or in the aggregate, result in a Material Adverse Effect; no
amendments or other changes to such programming agreements, other than
amendments relating to intra-company transfers, extensions of termination dates
or pricing adjustments, together with other changes that are not in the
aggregate material, have been made to the copies of the programming agreements
provided for the review of the Purchasers or their representatives;<br>
kk.  The Issuer and the Issuer's subsidiaries (i) are in compliance with any and
all applicable foreign, federal, state and local laws and regulations relating
to the protection of human health and safety, the environment or hazardous or
toxic substances or wastes, pollutants or contaminants (&quot;<U>Environmental
Laws</U>&quot;), (ii) have received all permits, licenses or other approvals
required of `them under applicable Environmental Laws to conduct their
respective businesses and (iii) are in compliance with all terms and conditions
of any such permit, license or approval, except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or other
approvals or failure to<SUB>.  </SUB>comply with the terms and conditions of
such permits, licenses or approvals would not, individually or in the aggregate,
have a Material Adverse Effect;<br>
ll.  Immediately after the consummation of this offering (including after giving
effect to the execution, delivery and performance of this Agreement and the
Indenture and the issuance and sale of the Securities), (i) the fair market
value of the assets of each of Charter Communications Holdings, LLC,  CCH I,
LLC, CCH II, LLC, CCO Holdings, LLC, Charter Communications Operating, LLC and
the Issuer, each on a consolidated basis with its subsidiaries, exceeds and will
exceed its liabilities, on a consolidated basis with its subsidiaries; (ii) the
present fair saleable value of the assets of each of Holdings, CCH I, LLC, CCH
II, LLC, CCOH and the Issuer, each on a consolidated basis with its
subsidiaries, exceeds and will exceed its liabilities, on a consolidated basis
with its subsidiaries; (iii) each of Charter Communications Holdings, LLC,  CCH
I, LLC, CCH II, LLC, CCO Holdings, LLC, Charter Communications Operating, LLC
and the Issuer, each on a consolidated basis with its subsidiaries, is and will
be able to pay its debts, on a consolidated basis with its subsidiaries, as such
debts respectively mature or otherwise become absolute or due; and (iv) each of
Charter Communications Holdings, LLC,  CCH I, LLC, CCH II, LLC, CCO Holdings,
LLC, Charter Communications Operating, LLC and the Issuer, on a consolidated
basis with its subsidiaries, does not have and will not have unreasonably small
capital with which to conduct its respective operations;<br>
mm.  The Issuer maintains a system of disclosure controls and procedures to
ensure that material information relating to the Issuer, including its
consolidated subsidiaries, is made known to each of them by others within those
entities, particularly during the period in which the periodic reports are being
prepared;<br>
nn.  There is, and has been, no failure on the part of the Issuer or the Issuer's
subsidiaries, or any of their directors or officers, in their capacities as
such, to comply with any provision of the Sarbanes Oxley Act of 2002 and the
rules and regulations promulgated in connection therewith, including, without
limitation, Section 402 related to loans and Sections 302 and 906 related to
certifications;<br>
oo.  The statistical and market-related data included in the Offering Memorandum
are based on or derived from sources that the Issuer believes to be reliable and
accurate;<br>
pp.  Each of the relationships and transactions specified in Item 404 of
Regulation S-K that would have been required to be described in a Form 10-K have
been so described in the Offering Memorandum (exclusive of any amendment or
supplement thereto); and<br>
qq.  Prior to the date hereof, the Issuer has received and will furnish to the
Representatives letters, each substantially in the form of Exhibit A hereto,
duly executed by each executive officer and director of the Issuer and addressed
to the Representatives; provided however that such letters have not been
received for Charles Lillis and Robert May.  </LI>

<LI><U>Purchase and Sale</U>.  </LI><FONT SIZE=3> </FONT><OL
TYPE="a"><LI>Subject to the terms and conditions herein set forth, the Issuer
agrees to issue and sell to each of the Purchasers, and each of the Purchasers
agrees, severally and not jointly, to purchase from the Issuer the original
principal amount of  Firm Securities set forth opposite the name of such
Purchaser in Schedule I hereto, at an aggregate purchase price of 96.500% of the
original principal amount thereof).</LI>

<LI>Subject to the terms and conditions and in reliance upon the representations
and warranties herein set forth, the Issuer hereby grants an option to the
several Purchasers to purchase, severally and not jointly, the Option
Securities, solely for the purpose of satisfying over-allotments, at the same
purchase price as the Purchasers shall pay for the Firm Securities, plus accrued
interest, if any, from November 22, 2004 to the settlement date for the Option
Securities which settlement date shall be no later than the 12th calendar day
following the Time of Delivery. The option may be exercised in whole or in part
(but not more than once) upon written or telegraphic notice by the
Representatives to the Issuer setting forth the original principal amount of
Option Securities as to which of the several Purchasers are exercising the
option and the settlement date (such settlement date, the &quot;<B>Option
Closing Date</B>&quot;). Delivery of the Option Securities, and payment
therefor, shall be made as provided in Section 4 hereof. The original principal
amount of Option Securities to be purchased by each Initial Purchaser shall be
the same percentage of the total original principal amount of Option Securities
to be purchased by the several Purchasers as such Initial Purchaser is
purchasing of the Firm Securities, subject to such adjustments as you in your
absolute discretion shall make to eliminate any fractional Securities.</LI></OL>

<LI><U>Representations, Warranties and Covenants of the Purchasers</U>.  Upon
the authorization by you of the release of the Securities, the several
Purchasers propose to offer the Securities for sale upon the terms and
conditions set forth in this Agreement and the Offering Memorandum and each
Purchaser, severally and not jointly, hereby represents and warrants to, and
agrees with the Issuer that:</LI>
<OL TYPE="a">

<LI>It will offer and sell the Securities only to persons who it reasonably
believes are &quot;qualified institutional buyers&quot;
(&quot;<U>QIBs</U>&quot;) within the meaning of Rule 144A under the Act in
transactions meeting the requirements of Rule 144A;</LI>
<LI>It is an institutional &quot;accredited investor&quot; within the meaning of
Regulation D under the Act; and</LI>
<LI>It has not offered and will not offer or sell the Securities by any form of
general solicitation or general advertising, including, without limitation, the
methods described in Rule 502(c) under the Act.</LI></OL>

<LI><U>Delivery and Payment.</LI>
<OL TYPE="a">

</U><FONT FACE="TimesNewRoman"><LI>Delivery of and payment for the Firm
Securities and the Option Securities (if the option provided for in Section 2(b)
hereof shall have been exercised on or before the third Business Day prior to
the Time of Delivery) shall be made at 10:00 A.M., New York City time, on
November 22, 2004, or at such time on such later date not more than three
Business Days after the foregoing date as the Representatives shall designate,
which date and time may be postponed by agreement between the Representatives
and the Issuer or as provided in Section 9 hereof (such date and time of
delivery and payment for the Securities being herein called the &quot;Time of
Delivery&quot;). Delivery of the Securities shall be made to the Representatives
for the respective accounts of the several Purchasers against payment by the
several Purchasers through the Representatives of the purchase price thereof to
or upon the order of the Issuer by wire transfer payable in same-day funds to
the account specified by the Issuer. Delivery of the Securities shall be made
through the facilities of The Depository Trust Company unless the
Representatives shall otherwise instruct.</LI>
</FONT><FONT SIZE=3><LI>I</FONT>f the option provided for in Section 2(b) hereof
is exercised after the third Business Day prior to the Time of Delivery, the
Issuer will deliver the Option Securities (at the expense of the Issuer) to the
Representatives on the Option Closing Date specified by the Representatives
(which shall be no earlier than three Business Days after exercise of said
option) for the respective <FONT FACE="TimesNewRoman">accounts of the several
Purchasers, against payment by the several Purchasers through the
Representatives of the purchase price thereof to or upon the order of the Issuer
by wire transfer payable in same-day funds to the account specified by the
Issuer. If settlement for the Option Securities occurs after the Time of
Delivery, the Issuer will deliver to the Representatives on the Option Closing
Date, and the obligation of the Purchasers to purchase the Option Securities
shall be conditioned upon receipt of, supplemental opinions, certificates and
letters confirming as of such date the opinions, certificates and letters
delivered at the Time of Delivery pursuant to Section 7 hereof.</LI>
</FONT><LI>The documents to be delivered at the Time of Delivery by or on behalf
of the parties hereto pursuant to Section 7 hereof, including, without
limitation, the cross-receipt for the Securities and any additional documents
requested by the Purchasers pursuant to Section 7(m) hereof, will be delivered
at such time and date at the offices of Weil, Gotshal &amp; Manges LLP, 767
Fifth Avenue, New York, New York 10153 or such other location as the parties
mutually agree (the &quot;<U>Closing Location</U>&quot;), and the Securities
will be delivered to the Depository Trust Company, unless otherwise instructed
by the Representatives, all at the Time of Delivery.  A meeting will be held at
the Closing Location at 6 p.m., New York City time, on the New York Business Day
next preceding the Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto.  For the purposes of this Section 4, &quot;New
York Business Day&quot; shall mean each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in New York are
generally authorized or obligated by law or executive order to close.</LI></OL>

<LI><U>Agreements</U>.  The Issuer agrees with each of the Purchasers:</LI>
<OL TYPE="a">

<LI>To prepare the Offering Memorandum in a form approved by you; to make no
amendment or any supplement to the Offering Memorandum which shall not be
approved by you promptly after reasonable notice thereof; and to furnish you
with copies thereof;</LI>
<LI>Promptly from time to time to take such action as you may reasonably request
to qualify the Securities for offering and sale under the securities laws of
such jurisdictions as you may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such jurisdictions for
as long as may be necessary to complete the distribution of the Securities;
<U>provided</U> that in connection therewith the Issuer shall not be required to
qualify as a foreign corporation or limited liability company, as the case may
be, or to file a general consent to service of process in any jurisdiction;</LI>
<LI>To furnish the Purchasers with copies of the Offering Memorandum and each
amendment or supplement thereto signed by an authorized officer of each of the
Issuer with the independent accountants' reports in the Offering Memorandum, and
any amendment or supplement containing amendments to the financial statements
covered by such reports, signed by the accountants, and additional copies
thereof in, such quantities as you may from time to time reasonably request, and
if, at any time prior to the expiration of nine months after the date of the
Offering Memorandum, any event shall have occurred as a result of which the
Offering Memorandum as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made when such Offering Memorandum is delivered, not misleading,
or, if for any other reason it shall be necessary or desirable during such same
period to amend or supplement the Offering Memorandum, to notify you and upon
your request to prepare and furnish without charge to each Purchaser and to any
dealer in securities as many copies as you may from time to time reasonably
request of an amended Offering Memorandum or a supplement to the Offering
Memorandum which will correct such statement or omission or effect such
compliance; </LI>
<LI>Not to be or become, at any time prior to the expiration of two years after
the Time of Delivery, an open-end investment company, unit investment trust,
closed-end investment company or face-amount certificate company that is or is
required to be registered under Section 8 of the Investment Company Act;</LI>
<LI>At any time when the Issuer is not subject to or in compliance with Section
13 or 15(d) of the Exchange Act, for the benefit of holders from time to time of
Securities or Converted Common Stock, to furnish at the Issuer's expense, upon
request, to holders of Securities or Converted Common Stock and prospective
purchasers of such securities information (the &quot;<U>Additional Issuer
Information</U>&quot;) satisfying the requirements of subsection (d)(4)(i) of
Rule 144A under the Act;</LI>
<LI>If such documents are not then available on the Commission's EDGAR Database,
to furnish or make electronically available to the holders of the Securities or
Converted Common Stock as soon as practicable after the end of each fiscal year
an annual report (including a balance sheet and statements of income, members'
or stockholders' equity and cash flows of the Issuer and its consolidated
subsidiaries certified by independent public accountants), and, as soon as
practicable after the end of each of the first three quarters of each fiscal
year (beginning with the fiscal quarter ending after the date of the Offering
Memorandum), to make electronically available to holders of the Securities, or
the Converted Common Stock,  consolidated summary financial information of the
Issuer and its subsidiaries for such quarter in reasonable detail;</LI>
<LI>If such documents are not then available on the Commission's EDGAR Database,
during a period of three years from the date of the Offering Memorandum, to
furnish or make electronically available to you, copies of all reports or other
communications (financial or other) furnished to holders of ownership interests
of the Issuer, and to furnish or make electronically available to you, as soon
as they are available, of any reports and financial statements furnished to or
filed with the Commission or any securities exchange on which the Securities,
the Common Stock, or any class of securities of the Issuer is listed;</LI>
<LI>During the period of two years after the Time of Delivery, the Issuer will
not, and will not permit any of its &quot;affiliates&quot; (as defined in Rule
144 under the Act) to, resell any of the Securities, or Converted Common Stock,
which constitute &quot;restricted securities&quot; under Rule 144 that have been
reacquired by any of them;</LI>
<LI>To use the net proceeds received from the sale of the Securities pursuant to
this Agreement in the manner specified in the Offering Memorandum under the
caption &quot;Use of Proceeds&quot;;</LI>
<LI>To issue, no later than the close of business on the business day following
the Time of Delivery, an Irrevocable Notice of Redemption, pursuant to the
Indenture governing the 5.75% Convertible Senior Notes due 2005, calling for
redemption all notes outstanding under such Indenture;  </LI>
<LI>None of the Issuer or any of its affiliates, nor any person authorized to
act on its behalf (other than the Purchasers, as to whom the Issuer takes no
responsibility), will engage in any form of general solicitation or general
advertising (within the meaning of Regulation D) in connection with any offer or
sale of the Securities in the United States;</LI>
<LI>None of the Issuer or any of its affiliates, nor any person authorized to
act on its behalf (other than the Purchasers, as to whom the Issuer takes no
responsibility) will, directly or indirectly, make offers or sales of any
security, or solicit offers to buy any security, under circumstances that would
require the registration of the Securities, the Converted Common Stock or the
Borrowed Common Stock under the Act, except pursuant to the 144A Registration
Rights Agreement or the Borrowed Stock Registration Rights Agreement, as
applicable;</LI>
<LI>Except as otherwise permitted by Regulation M under the Exchange Act, none
of the Issuer or any of its affiliates will take, directly or indirectly, any
action designed to or which has constituted or which would reasonably be
expected to cause or result, under the Exchange Act or otherwise, in
stabilization or manipulation of the price of any security of the Issuer to
facilitate the sale or resale of the Securities;</LI>
<FONT FACE="TimesNewRoman"><LI>The Issuer will reserve and keep available at all
times, free of preemptive rights, the full number of shares of Common Stock
issuable upon conversion of the Securities;</LI>
<LI>The Issuer will reserve and keep available at all times, free of preemptive
rights, the full number of shares of Borrowed Common Stock issuable pursuant to
the Share Lending Agreement;</LI>
<LI>The Issuer will not and will not permit any of its affiliates or anyone
authorized to act on behalf of the Issuer or their affiliates, for a period of
90 days following the date hereof, without the prior written consent of
Citigroup Global Markets Inc., directly or indirectly, offer, sell, contract to
sell, pledge, otherwise dispose of, enter into any transaction which is designed
to, or might reasonably be expected to, result in the disposition (whether by
actual disposition or effective economic disposition due to cash settlement or
otherwise) by the Issuer or any Affiliate of the Issuer or any person in privity
with the Issuer or any Affiliate of the Issuer of, file (or participate in the
filing of) a registration statement with the Commission in respect of, or
establish or increase a put equivalent position or liquidate or decrease a call
equivalent  position within the meaning of Section 16 of the Exchange Act in
respect of, any shares of capital stock of the Issuer or any securities
convertible into, or exercisable or exchangeable for, shares of capital stock of
the Issuer (other than the Securities), or publicly announce an intention to
effect any such transaction; provided, however, that the Issuer may (i) issue
and loan Common Stock pursuant to the Share Lending Agreement, (ii) may issue
and sell Common Stock pursuant to any employee stock option plan, stock
ownership plan or dividend reinvestment plan of the Issuer described in the
Offering Memorandum and in effect as of the date hereof, (iii) may issue Common
Stock issuable upon the conversion of the Securities or the conversion of any
other securities or the exercise of warrants outstanding as of the date hereof
and described in the Offering Memorandum, (iv) may issue securities to officers,
directors and employees under existing incentive plans approved by the Board of
Directors of the Issuer or to consultants or other service providers as approved
by the Board of Directors of the Issuer, (v) may issue securities in exchange
for securities of the Issuer or its subsidiaries outstanding on the date hereof,
(vi) may issue stock pursuant to agreements existing on the date hereof (but
only to the extent such agreements have been previously disclosed in the
Issuer's filings pursuant to the Act or the Exchange Act, and (vii) may issue
securities in settlement of any bona fide claim, including, without limitation,
the securities to be issued in connection with the litigation described in the
Issuer's Quarterly Report on Form 10-Q for the period ended September 30, 2004
(including the issuance of securities to the Issuer's insurance carrier). </LI>
</FONT><LI>The Issuer will use its best efforts prior to the Time of Delivery to
cause the Securities to be eligible for the PORTAL trading system of the
NASD.</LI></OL>

<LI><U>Agreement to Pay Certain Fees</U>.  The Issuer covenants and agrees with
the several Purchasers that the Issuer will pay or cause to be paid the
following:  (i) the fees, disbursements and expenses of the Issuer's counsel and
accountants in connection with the issue of the Securities and the issuance of
the Converted Common Stock and all other expenses in connection with the
preparation, printing and filing of the Offering Memorandum and any amendments
and supplements thereto and the mailing and delivering of copies thereof to the
Purchasers and dealers; (ii) the cost of printing or producing any Agreement
among Purchasers, the Transaction Documents, the Securities, the Blue Sky and
Legal Investment Memoranda, closing documents (including, without limitation,
any compilations thereof) and any other documents in connection with the
offering, purchase, sale and delivery of the Securities; (iii) all expenses in
connection with the qualification of the Securities for offering and sale under
state securities laws as provided in Section 5(b) hereof, including, without
limitation, the fees and disbursements of counsel for the Purchasers in
connection with such qualification and in connection with the Blue Sky and Legal
Investment surveys; (iv) any fees charged by securities rating services for
rating the Securities; (v) the cost of preparing the Securities; (vi) the fees
and expenses of the Trustee and any agent of the Trustee and the fees and
disbursements of counsel for the Trustee in connection with the Indenture and
the Securities; (vii) any cost incurred in connection with the designation of
the Securities for trading in PORTAL; and (viii) all other costs and expenses
incident to the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section.  It is understood, however, that,
except as provided in this Section 6 and Sections 9 and 12 hereof; the
Purchasers will pay all their own costs and expenses, including, without
limitation, the fees of their counsel, transfer taxes on resale of any of the
Securities by them, and any advertising expenses connected with any offers they
may make.</LI>
<LI><U>Conditions to the Obligations of the Purchasers</U>.  The obligations of
the Purchasers to purchase the Firm Securities and the Option Securities shall
be subject, in their discretion, to the condition that all representations and
warranties and other statements of the Issuer herein are, at and as of the date
hereof and the Time of Delivery, true and correct, the condition that the Issuer
shall have performed all their obligations hereunder theretofore to be
performed, and the following additional conditions shall have been satisfied on
or prior to the Closing Date:</LI>
<OL TYPE="a">

<LI>The Purchasers shall have received from Weil, Gotshal &amp; Manges LLP,
counsel for the Purchasers, such opinion or opinions, dated the Time of Delivery
and addressed to the Purchasers, with respect to the issuance and sale of the
Securities, the Transaction Documents, the Offering Memorandum (as amended or
supplemented at the Time of Delivery) and other related matters as the
Purchasers may reasonably require, and the Issuer shall have furnished to such
counsel such documents as they request for the purpose of enabling them to pass
upon such matters.</LI>
<LI>The Purchasers shall have received from Davis Polk &amp; Wardwell LLP,
special counsel for the Purchasers, such opinion or opinions, dated the Time of
Delivery and addressed to the Purchasers, with respect to the issuance and sale
of the Securities, the Transaction Documents, the Offering Memorandum (as
amended or supplemented at the Time of Delivery) and other related matters as
the Purchasers may reasonably require, and the Issuer shall have furnished to
such counsel such documents as they request for the purpose of enabling them to
pass upon such matters.</LI>
<LI>Irell &amp; Manella LLP, counsel for the Issuer, shall have furnished to you
their written opinions, dated the Time of Delivery, substantially in the forms
of Annex I.</LI>
<LI>Cole, Raywid &amp; Braverman, L.L.P., special regulatory counsel to the
Issuer, shall have furnished to you their written opinion, dated the Time of
Delivery, in form and substance reasonably satisfactory to you, to the effect
that:</LI>
<OL TYPE="i">

<LI>The issue and sale of the Securities and the compliance by the Issuer with
all the provisions of the Securities and the Transaction Documents and the
consummation of the transactions herein and therein contemplated do not and will
not contravene the Cable Acts or any order, rule or regulation of the FCC to
which the Issuer or any of their Parent Companies or subsidiaries or any of
their property is subject; however, to the extent that any document purports to
grant a security interest in licenses issued by the FCC, the FCC has taken the
position that security interests in FCC licenses are not valid.  To the extent
that any party seeks to exercise control of an FCC license in the event of a
default or for any other reason, it may be necessary to obtain prior FCC
consent;</LI>
<LI>To the best of such counsel's knowledge, no consent, approval, authorization
or order of, or registration, qualification or filing with the FCC is required
under the Cable Acts or any order, rule or regulation of the FCC in connection
with the issue and sale of the Securities and the compliance by the Issuer with
all the provisions of the Securities, the Indenture, the Security Documents and
this Agreement and the consummation of the transactions herein and therein
contemplated; however, to the extent that any document purports to grant a
security interest in licenses issued by the FCC, the FCC has taken the position
that security interests in FCC licenses are not valid; to the extent that any
party seeks to exercise control of an FCC license in the event of a default or
for any other reason, it may be necessary to obtain prior FCC consent;</LI>
<LI>The statements set forth in the Offering Memorandum under the caption
&quot;Risk Factors&quot; under the subheading &quot;Risks relating to regulatory
and legislative matters,&quot; insofar as they constitute summaries of laws
referred to therein, concerning the Cable Acts and the published rules,
regulations and policies promulgated by the FCC thereunder, fairly summarize the
matters described therein;</LI>
<LI>To such counsel's knowledge based solely upon its review of publicly
available records of the FCC and operational information provided by the
Issuer's and their Parent Companies and subsidiaries' management, the Issuer and
its subsidiaries hold all FCC licenses for cable antenna relay services
necessary to conduct the business of the Issuer and its subsidiaries as
currently conducted, except to the extent the failure to hold such FCC licenses
would not, individually or in the aggregate, be reasonably expected to have a
Material Adverse Effect; and</LI>
<LI>Except as disclosed in the Offering Memorandum and except with respect to
rate regulation matters, and general rulemakings and similar matters relating
generally to the cable television, industry, to such counsel's knowledge, based
solely upon its review of the publicly available records of the FCC and upon
inquiry of the Issuer's and its subsidiaries' management, during the time the
cable systems of the Issuer and its subsidiaries have been owned by the Issuer
and its subsidiaries (A) there has been no adverse FCC judgment, order or decree
issued by the FCC relating to the ongoing operations of any of the Issuer or one
of its subsidiaries that has had or could reasonably be expected to have a
Material Adverse Effect; and (B) there are no actions, suits, proceedings,
inquiries or investigations by or before the FCC pending or threatened in
writing against or specifically affecting the Issuer or any of its Parent
Companies or subsidiaries or any cable system of the Issuer or any of its
subsidiaries which could, individually or in the aggregate, be reasonably
expected to result in a Material Adverse Effect;</LI></OL>

<LI>Curtis Shaw, Esq., General Counsel of the Issuer, shall have furnished to
you his written opinion, dated as of the Time of Delivery, in form and substance
satisfactory to you, to the effect that:</LI>
<OL TYPE="i">

<LI>Each subsidiary of the Issuer listed on a schedule attached to such
counsel's opinion (the &quot;<U>Charter Subsidiaries</U>&quot;) has been duly
incorporated or formed, as the case may be, and is validly existing as a
corporation, limited liability company or partnership, as the case may be, in
good standing under the laws of its jurisdiction of incorporation or formation;
and all the issued shares of capital stock, limited liability company interests
or partnership interests, as the case may be, of each Charter Subsidiary are set
forth on the books and records of the Issuer and, except for those Charter
Subsidiaries that are general partners, assuming receipt of requisite
consideration therefor, are fully paid and nonassessable (in the case of
corporate entities) and not subject to additional capital contributions (in the
case of limited liability company entities and limited partnerships); and,
except as otherwise set forth in the Offering Memorandum, and except for liens
not prohibited under the credit agreements listed on such schedule, all
outstanding shares of capital stock of each of the Charter Subsidiaries are
owned by the Issuer, either directly or indirectly or through wholly-owned
subsidiaries free and clear of any perfected security interest and, to the
knowledge of such counsel, after due inquiry, any other security interest,
claim, lien or encumbrance;</LI>
<LI>Each of the Issuer and the Charter Subsidiaries has been duly qualified as a
foreign corporation, partnership or limited liability company, as the case may
be, for the transaction of business and is in good standing under the laws of
each jurisdiction set forth in a schedule to such counsel's opinion;</LI>
<LI>To the best of such counsel's knowledge and other than as set forth in the
Offering Memorandum, there are no legal or governmental proceedings pending to
which the Issuer, or any of the Issuer's subsidiaries is party or of which any
property of the Issuer or any of the Issuer's subsidiaries is the subject, of a
character required to be disclosed in a registration statement on Form S-1,
which is not disclosed in the Offering Memorandum, except for such proceedings
which are not likely to have, individually or in the aggregate, a Material
Adverse Effect; and, to the best of such counsel's knowledge and other than as
set forth in the Offering Memorandum, no such proceedings are overtly threatened
by governmental authorities or by others; and</LI>
<LI>The issue and sale of the Securities and the compliance by the Issuer with
all the provisions of the Securities and the Transaction Documents and the
consummation of the transactions therein contemplated will not result in a
violation of the provisions of the certificate of incorporation or by-laws, or
certificate of formation or limited liability company agreement or partnership
agreement, as the case may be, of any of the Charter Subsidiaries;</LI></OL>

<LI>On the date of the Offering Memorandum and also at the Time of Delivery,
KPMG LLP shall have furnished to you a letter or letters, dated the respective
dates of delivery thereof, in form and substance satisfactory to you;</LI>
<LI>None of the Issuer or any of the Issuer's subsidiaries shall have sustained
since the date of the latest audited financial statements included in the
Offering Memorandum any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any court or governmental action, order or decree, otherwise than as set forth
or contemplated in the Offering Memorandum, and (ii) since the respective dates
as of which information is given in the Offering Memorandum (for clarification
purposes, this excludes any amendment or supplement to the Offering Memorandum
on or after the date of this Agreement) there shall not have been any change in
the capital stock, limited liability company interests, partnership interests or
long-term debt of the Issuer or any of its subsidiaries or any change, or any
development involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' or members' equity, or results of
operations of the Issuer and its subsidiaries, otherwise than as set forth or
contemplated in the Offering Memorandum, the effect of which, in any such case
described in clause (i) or (ii), is in the judgment of the Purchasers so
material and adverse as to make it impracticable or inadvisable to proceed with
the offering or the delivery of the Securities on the terms and in the manner
contemplated in this Agreement and in the Offering Memorandum;</LI>
<LI>Subsequent to the execution and delivery of this Agreement, (i) no
downgrading shall have occurred in the rating accorded the Securities or any
other debt securities or preferred stock issued or guaranteed by the Issuer by
any &quot;nationally recognized statistical rating organization,&quot; as such
term is defined by the Commission for purposes of Rule 436(g)(2) under the Act;
and (ii) no such organization shall have publicly announced that it has under
surveillance or review, or has changed its outlook with respect to, its rating
of the Securities or of any other debt securities or preferred stock issued or
guaranteed by the Issuer (other than an announcement with positive implications
of a possible upgrading);</LI>
<LI>On or after the date hereof there shall not have occurred any of the
following:  (i) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange or on the Nasdaq National Market; (ii)
a suspension or material limitation in trading in the Common Stock on the Nasdaq
National Market, (iii) a general moratorium on commercial banking activities
declared by either Federal or New York State authorities; or (iv) the outbreak
or escalation of hostilities or the declaration of a national emergency or war
or the occurrence of any other calamity or crisis, if the effect of any such
event specified in this clause (iv) in the judgment of the Purchasers makes it
impracticable or inadvisable to proceed with the offering; sale or the delivery
of the Securities on the terms and in the manner contemplated in the Offering
Memorandum;</LI>
<LI>The Securities shall have been designated for trading on PORTAL; </LI>
<LI>The Issuer shall have applied for the listing of the Converted Common Stock
on the Nasdaq National Market;  </LI>
<LI>The Issuer shall have applied for the listing of the Borrowed Common Stock
initially issuable pursuant to the Share Lending Agreement on the Nasdaq
National Market;</LI>
<LI>The Issuer shall have furnished or caused to be furnished to you at the Time
of Delivery certificates of officers of each Issuer satisfactory to you as to
the accuracy of the representations and warranties of the Issuer herein at and
as of such Time of Delivery, as to the performance by the Issuer of all their
obligations hereunder to be performed at or prior to such Time of Delivery, as
to the matters set forth in subsections (g) and (h) of this Section 7 and as to
such other matters as you may reasonably request; and</LI>
<LI>The Issuer shall have executed each of the Transaction Documents.
</LI></OL>

<LI><U>Indemnification and Contribution.</U></LI>
<OL TYPE="a">

<LI><U>Indemnification of the Purchasers</U>.  The Issuer agrees to indemnify
and hold harmless each Purchaser, its affiliates, directors and officers and
each person, if any, who controls such Purchaser within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages and liabilities (including, without limitation,
reasonable legal fees and other expenses incurred in connection with any suit,
action or proceeding or any claim asserted, as such fees and expenses are
incurred), joint or several, that arise out of, or are based upon, any untrue
statement or alleged untrue statement of a material fact contained or
incorporated by reference in the Offering Memorandum (or any amendment or
supplement thereto) or any omission or alleged omission to state therein a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except insofar as
such losses, claims, damages or liabilities arise out of, or are based upon, any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with any information relating to any Purchaser
furnished to the Issuer in writing by such Purchaser through Citigroup Global
Markets Inc. expressly for use therein.</LI>
<LI><U>Indemnification of the Issuer</U>.  Each Purchaser agrees, severally and
not jointly, to indemnify and hold harmless the Issuer, its affiliates,
officers, directors, employees, members, managers and agents, and each person,
if any, who controls the Issuer within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act to the same extent as the indemnity set forth in
paragraph (a) above, but only with respect to any losses, claims, damages or
liabilities that arise out of, or are based upon, any untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in
conformity with any information relating to such Purchaser furnished to the
Issuer in writing by such Purchaser through Citigroup Global Markets Inc.
expressly for use in the Offering Memorandum (or any amendment or supplement
thereto), it being understood and agreed that the only such information consists
of the following: the statements set forth in the last paragraph of the cover
page regarding the delivery of the Securities, and under the heading &quot;Plan
of Distribution,&quot; the eleventh paragraph related to over-allotment,
covering and stabilization transactions.</LI>
<LI><U>Notice and Procedures</U>.  If any suit, action, proceeding (including
any governmental or regulatory investigation), claim or demand shall be brought
or asserted against any person in respect of which indemnification may be sought
pursuant to either paragraph (a) or (b) above, such person (the
&quot;<U>Indemnified Person</U>&quot;) shall promptly notify the person against
whom such indemnification may be sought (the &quot;<U>Indemnifying
Person</U>&quot;) in writing; provided that the failure to notify the
Indemnifying Person shall not relieve it from any liability that it may have
under this Section 8 except to the extent that it has been materially prejudiced
(through the forfeiture of substantive rights or defenses) by such failure; and
provided, further, that the failure to notify the Indemnifying Person shall not
relieve it from any liability that it may have to an Indemnified Person
otherwise than under this Section 8.  If any such proceeding shall be brought or
asserted against an Indemnified Person and it shall have notified the
Indemnifying Person thereof, the Indemnifying Person shall retain counsel
reasonably satisfactory to the Indemnified Person to represent the Indemnified
Person and any others entitled to indemnification pursuant to this Section 8
that the Indemnifying Person may designate in such proceeding and shall pay the
reasonable fees and expenses of such counsel related to such proceeding, as
incurred.  In any such proceeding, any Indemnified Person shall have the right
to retain its own counsel, but the fees and expenses of such counsel shall be at
the expense of such Indemnified Person unless (i) the Indemnifying Person and
the Indemnified Person shall have mutually agreed to the contrary; (ii) the
Indemnifying Person has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person
shall have reasonably concluded that there may be legal defenses available to it
which if raised in a proceeding involving both parties would be inappropriate
under applicable legal or ethical standards due to actual or potential differing
interests between it and the Indemnifying Person; or (iv) the named parties in
any such proceeding (including any impleaded parties) include both the
Indemnifying Person and the Indemnified Person and representation of both
parties by the same counsel would be inappropriate under applicable legal or
ethical standards due to actual or potential differing interests between them.
It is understood and agreed that the Indemnifying Person shall not, in
connection with any proceeding or related proceeding in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all Indemnified Persons, and that all such reasonable
fees and expenses shall be reimbursed as they are incurred.  Any such separate
firm for any Purchaser, its affiliates, directors and officers and any control
persons of such Purchaser shall be designated in writing by Citigroup Global
Markets Inc. and any such separate firm for the Issuer and any control persons
of the Issuer shall be designated in writing by the Issuer.  The Indemnifying
Person shall not be liable for any settlement of any proceeding effected without
its written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, not subject to further appeal, the Indemnifying
Person agrees to indemnify each Indemnified Person from and against any loss or
liability provided for in such settlement or judgment.  No Indemnifying Person
shall, without the written consent of the Indemnified Person (which shall not be
unreasonably withheld), effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is or could have been a
party and indemnification could have been sought hereunder by such Indemnified
Person, unless such settlement (x) includes an unconditional release of such
Indemnified Person, in form and substance reasonably satisfactory to such
Indemnified Person, from all liability on claims that are the subject matter of
such proceeding and (y) does not include any statement as to or any admission of
fault, culpability or a failure to act by or on behalf of such Indemnified
Person.</LI>
<LI><U>Contribution</U>.  If the indemnification provided for in paragraphs (a)
and (b) above is unavailable to an Indemnified Person or insufficient in respect
of any losses, claims, damages or liabilities referred to therein, then each
Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Issuer on the one hand and the Purchasers on the other
from the offering of the Securities or (ii) if the allocation provided by clause
(i) is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) but also the
relative fault of the Issuer on the one hand and the Purchasers on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations.  The relative benefits received by the Issuer on the one hand
and the Purchasers on the other shall be deemed to be in the same respective
proportions as the net proceeds (before deducting expenses) received by the
Issuer from the sale of the Securities and the total discounts and commissions
received by the Purchasers in connection therewith, as provided in this
Agreement, bear to the aggregate offering price of the Securities.  The relative
fault of the Issuer on the one hand and the Purchasers on the other shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Issuer or by the
Purchasers and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.</LI>
<LI><U>Limitation on Liability</U>.  The Issuer and the Purchasers agree that it
would not be just and equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation (even if the Purchasers were treated as one
entity for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in paragraph (d) above.  The
amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in paragraph (d) above shall be
deemed to include, subject to the limitations set forth above, any legal or
other expenses incurred by such Indemnified Person in connection with any such
action or claim.  Notwithstanding the provisions of this Section 8, in no event
shall a Purchaser be required to contribute any amount in excess of the amount
by which the total discounts and commissions received by such Purchaser with
respect to the offering of the Securities exceeds the amount of any damages that
such Purchaser has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission.  No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.  The Purchasers' obligations to contribute
pursuant to this Section 8 are several in proportion to their respective
purchase obligations hereunder and not joint.</LI>
<LI><U>Non-Exclusive Remedies</U>.  The remedies provided for in this Section 8
are not exclusive and shall not limit any rights or remedies that may otherwise
be available to any Indemnified Person at law or in equity.</LI></OL>

<LI><U>Default by a Purchaser.</LI>
<OL TYPE="a">

</U><LI>If any Purchaser shall default in its obligation to purchase the
Securities which it has agreed to purchase hereunder, you may in your discretion
arrange for you or another party or other parties to purchase such Securities on
the terms contained herein.  If within thirty-six hours after such default by
any Purchaser you do not arrange for the purchase of such Securities, then the
Issuer shall be entitled to a further period of thirty-six hours within which to
procure another party or other parties satisfactory to you to purchase such
Securities on such terms.  In the event that, within the respective prescribed
periods, you notify the Issuer<SUB>.  </SUB>that you have so arranged for the
purchase of such Securities, or the Issuer notify you that they have so arranged
for the purchase of such Securities, you or the Issuer shall have the right to
postpone the Time of Delivery for a period of not more than seven days, in order
to effect whatever changes may thereby be made necessary in the Offering
Memorandum, or in any other documents or arrangements, and the Issuer agree to
prepare promptly any amendments to the Offering Memorandum which in your opinion
may thereby be made necessary.  The term &quot;Purchaser&quot; as used in this
Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to this Agreement with
respect to such Securities.</LI>
<LI>If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Purchaser or Purchasers by you and the Issuer as
provided in subsection (a) above, the aggregate original principal amount of
such Securities which remains unpurchased does not exceed one-tenth of the
aggregate original principal amount of all the Securities, then the Issuer shall
have the right to require each non-defaulting Purchaser to purchase the original
principal amount of Securities which such Purchaser agreed to purchase hereunder
and, in addition, to require each non-defaulting Purchaser to purchase its pro
rata share (based on the original principal amount of Securities which such
Purchaser agreed to purchase hereunder) of the Securities of such defaulting
Purchaser or Purchasers for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Purchaser from liability for its
default.</LI>
<LI>If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Purchaser or Purchasers by you and the Issuer as
provided in subsection (a) above, the aggregate original principal amount of
Securities which remains unpurchased exceeds one-tenth of the aggregate original
principal amount of all the Securities, or if the Issuer shall not exercise the
right described in subsection (b) above to require non-defaulting Purchasers to
purchase Securities of a defaulting Purchaser or Purchasers, then this Agreement
shall thereupon terminate, without liability on the part of any non-defaulting
Purchaser or the Issuer, except for the expenses to be borne by the Issuer and
the Purchasers as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Purchaser from liability for its default.</LI></OL>

<LI><U>Representations and Indemnities to Survive</U>.  The respective
indemnities, agreements, representations, warranties and other statements of the
Issuer and the several Purchasers, as set forth in this Agreement or made by or
on behalf of them, respectively, pursuant to this Agreement, shall remain in
full force and effect, regardless of any investigation (or any statement as to
the results thereof) made by or on behalf of any Purchaser or any controlling
person of any Purchaser, or the Issuer, or any officer or director or
controlling person of the Issuer, and shall survive delivery of and payment for
the Securities.</LI>
<LI><U>Termination</U>.  If this Agreement shall be terminated pursuant to
Section 9 hereof, the Issuer shall not then be under any liability to any
Purchaser except as provided in Sections 6 and 8 hereof; but, if for any other
reason other than a termination pursuant to clauses (i), (iii) or (iv) of
Section 7(i), the Securities are not delivered by or on behalf of the Issuer as
provided herein, the Issuer will reimburse the Purchasers through you for all
out-of-pocket expenses approved in writing by you, including, fees and
disbursements of counsel, reasonably incurred by the Purchasers in making
preparations for the purchase, sale and delivery of the Securities, but the
Issuer shall then be under no further liability to any Purchaser except as
provided in Sections 6 and 8 hereof.</LI>
<LI><U>Reliance and Notices</U>.  In all dealings hereunder, you shall act on
behalf of each of the Purchasers, and the parties hereto shall be entitled to
act and rely upon any statement, request, notice or agreement on behalf of any
Purchaser made or given by you jointly or by Citigroup Global Markets Inc.  on
behalf of you as Purchasers.</LI>
<P>             All statements, requests, notices and agreements hereunder shall
be in writing, and if to the Purchasers (or any of them) shall be delivered or
sent by mail, telex or facsimile transmission to you as Purchasers (or a
Purchaser) to Citigroup Global Markets Inc., Attn: General Counsel,  388
Greenwich, New York, New York 10013 (fax: (212) 816-7912), and if to the Issuer
shall be delivered or sent by mail, telex or facsimile transmission to the
address of the Issuer set forth in the Offering Memorandum, Attention:
Secretary.  Any such statements, requests, notices or agreements shall take
effect upon receipt thereof.</P>
<LI><U>Successors</U>.  This Agreement shall be binding upon, and inure solely
to the benefit of, the Purchasers, the Issuer, and, to the extent provided in
Sections 9 and 11 hereof, the officers and directors of the Issuer and the
Purchasers and each person who controls the Issuer or any Purchaser, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement.  No purchaser of any of the Securities from any Purchaser shall be
deemed a successor or assign by reason merely of such purchase.</LI>
<LI><U>Timeliness</U>.  Time shall be of the essence in this Agreement.</LI>
<LI><U>Applicable Law</U>.  This Agreement shall be governed by and construed
in<SUB>.  </SUB>accordance with the laws of the State of New York.</LI>
<LI><U>Counterparts</U>.  This Agreement may be executed by any one or more of
the parties hereto in any number of counterparts, each of which shall be deemed
to be an original, but all such respective counterparts shall together
constitute one and the same instrument.</LI></OL>
</OL>

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<HR WIDTH="85%">
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<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY">If the foregoing is in accordance with your understanding,
please sign and return to us counterparts hereof, and upon the acceptance hereof
by you, on behalf of each of the Purchasers, this letter and such acceptance
hereof shall constitute a binding agreement between each of the Purchasers and
the Issuer.  It is understood that your acceptance of this letter on behalf of
each of the Purchasers is pursuant to the authority set forth in a form of
Agreement among Purchasers, the form of which shall be submitted to the Issuer
for examination upon request, but without warranty on your part as to the
authority of the signers thereof.</P><DIR>
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<P ALIGN="JUSTIFY">Very truly yours,</P><DIR>

<P>CHARTER COMMUNICATIONS, INC. <BR>
<BR>
By:&#9;<U>/s/ Derek Chang&#9;&#9;<BR>
</U>Name:&#9;Derek Chang<BR>
Title:&#9;Executive Vice President</P>

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<BR>
<HR WIDTH="85%">
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<BR>
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<P ALIGN="JUSTIFY"></P>
<P>Accepted as of the date hereof</P></DIR>

<P>CITIGROUP GLOBAL MARKETS INC. <BR>
MORGAN STANLEY &amp; CO. INCORPORATED<BR>
<BR>
<BR>
Acting severally on behalf of themselves and the <BR>
&#9;several Purchasers named in Schedule I &#9;hereto.<BR>
<BR>
By:  Citigroup Global Markets Inc. </P><DIR>

<P ALIGN="JUSTIFY">By:&#9;<U>/s/ Dan L. Richards&#9;&#9;<BR>
</U>Name:&#9;Dan L. Richards<BR>
Title:&#9;Managing Director</P>
<P ALIGN="JUSTIFY">By:  Morgan Stanley &amp; Co. Incorporated</P>
<P ALIGN="JUSTIFY">By:&#9;<U>/s/ W. L. Blais&#9;&#9;<BR>
</U>Name:&#9;W. L. Blais<BR>
Title:&#9;Managing Director<BR>
</P></DIR>
</DIR>
</DIR>
</DIR>
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<HR WIDTH="85%">
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<BR>

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<P ALIGN="RIGHT">EXHIBIT A</P></DIR>
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<U><FONT SIZE=2><P ALIGN="CENTER">Charter Communications, Inc.<BR>
Convertible Senior Notes due 2009</P>
</U><P ALIGN="RIGHT">November     , 2004</P>
<P>Citigroup Global Markets Inc.<BR>
Morgan Stanley &amp; Co. Incorporated <BR>
As Representative of the several Initial Purchasers,<BR>
c/o Citigroup Global Markets Inc.<BR>
388 Greenwich Street<BR>
New York, New York 10013</P>
<P>Ladies and Gentlemen:</P>
<P>This letter is being delivered to you in connection with the proposed
Purchase Agreement (the "Purchase Agreement"), between Charter Communications,
Inc., a  Delaware corporation (the "Company"), and you as representative of a
group of Initial Purchasers named therein, relating to an offering of 5.875%
Convertible Senior Notes due 2009, (the "Notes"), of the Company.  </P>
<P>In order to induce you and the other Initial Purchasers to enter into the
Purchase Agreement, the undersigned will not, without the prior written consent
of Citigroup Global Markets Inc., offer, sell, contract to sell, pledge or
otherwise dispose of, (or enter into any transaction which is designed to, or
might reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or
otherwise) by the undersigned or any affiliate of the undersigned or any person
in privity with the undersigned or any affiliate of the undersigned), directly
or indirectly, including the filing (or participation in the filing) of a
registration statement with the Securities and Exchange Commission in respect
of, or establish or increase a put equivalent position or liquidate or decrease
a call equivalent position within the meaning of Section 16 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder with respect to, any
shares of capital stock of the Company or any securities convertible into, or
exercisable or exchangeable for such capital stock, or publicly announce an
intention to effect any such transaction, for a period of 90 days after the date
of the Purchase Agreement.</P>
<P>Notwithstanding the foregoing, the undersigned may transfer any securities if
the transfer is (a)&nbsp;by gift, will or intestacy; (b) to a member or members
of his or her immediate family or to a trust the beneficiaries of which are
exclusively the undersigned and/or a member or members of his or her immediate
family (for purposes of this paragraph, &quot;immediate family&quot; shall mean
a spouse, lineal descendant, father, mother, brother or sister, niece, nephew,
mother-in-law, father-in-law, sister-in-law or brother-in-law of the transferor,
in each case whether by birth or adoption and including stepchildren); or
(c)&nbsp;by distribution to partners, members or shareholders of the
undersigned; provided, however, that in the case of a transfer pursuant to this
clause, it shall be a condition to the transfer that the transferee execute an
agreement stating that the transferee is receiving and holding the securities
subject to the provisions of this letter agreement.  Nothing herein shall be
construed to prohibit or limit in any way the undersigned's ability, as a holder
the Company's existing convertible senior notes, to have such notes redeemed and
to tender such notes for redemption and receive the proceeds thereof.</P>
<P>If for any reason the Purchase Agreement shall be terminated prior to the
Time of Delivery (as defined in the Purchase Agreement), the agreement set forth
above shall likewise be terminated.</P>
<DIR>
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<DIR>
<DIR>
<DIR>
<DIR>

<P>Yours very truly,<BR>
</P>

<P>By:   ___________________________<br>
         Name:<br>
         Title:</P>
</FONT><P ALIGN="JUSTIFY"></P></DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>

<BR>
<BR>
<BR>
<HR WIDTH="85%">
<BR>
<BR>
<BR>

<P ALIGN="RIGHT">SCHEDULE I</P>
<FONT SIZE=3>
<P>&nbsp;</P></FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 WIDTH=512>
<TR><TD WIDTH="53%" VALIGN="BOTTOM" HEIGHT=83>
<P ALIGN="CENTER">Purchasers</TD>
<TD WIDTH="47%" VALIGN="BOTTOM" HEIGHT=83>
<P ALIGN="CENTER">Original Principal Amount of Firm Securities to be
Purchased</TD>
</TR>
<TR><TD WIDTH="53%" VALIGN="TOP">
<P>Citigroup Global Markets Inc.</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P ALIGN="JUSTIFY">$ 600,000,000.00</TD>
</TR>
<TR><TD WIDTH="53%" VALIGN="TOP">
<P>Morgan Stanley &amp; Co. Incorporated </TD>
<TD WIDTH="47%" VALIGN="TOP">
<P ALIGN="JUSTIFY">112,500,000.00</TD>
</TR>
<TR><TD WIDTH="53%" VALIGN="TOP">
<P>BNP Paribas Securities Corp.</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P ALIGN="JUSTIFY">7,500,000.00</TD>
</TR>
<TR><TD WIDTH="53%" VALIGN="TOP">
<P>Calyon Securities (USA) Inc.</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P ALIGN="JUSTIFY">7,500,000.00</TD>
</TR>
<TR><TD WIDTH="53%" VALIGN="TOP">
<P>ABN AMRO Rothschild LLC</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P ALIGN="JUSTIFY">3,750,000.00</TD>
</TR>
<TR><TD WIDTH="53%" VALIGN="TOP">
<P>BNY Capital Markets, Inc.</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P ALIGN="JUSTIFY">3,750,000.00</TD>
</TR>
<TR><TD WIDTH="53%" VALIGN="TOP">
<P>Harris Nesbitt Corp.</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P ALIGN="JUSTIFY">3,750,000.00</TD>
</TR>
<TR><TD WIDTH="53%" VALIGN="TOP">
<P>Rabo Securities USA, Inc.</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P ALIGN="JUSTIFY">3,750,000.00</TD>
</TR>
<TR><TD WIDTH="53%" VALIGN="TOP">
<P>RBC Capital Markets Corporation </TD>
<TD WIDTH="47%" VALIGN="TOP">
<P ALIGN="JUSTIFY">3,750,000.00</TD>
</TR>
<TR><TD WIDTH="53%" VALIGN="TOP">
<P>Scotia Capital (USA) Inc.</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P ALIGN="JUSTIFY">3,750,000.00</TD>
</TR>
</TABLE>
</CENTER></P>

<P ALIGN="JUSTIFY"></P>
<FONT SIZE=3><P>&nbsp;</P>
</FONT><FONT SIZE=2><P>&nbsp;</P></FONT>Exhibit
10.1

 

LOAN AGREEMENT

 

This agreement
(“Loan Agreement” or “Agreement”) is made and entered into as of the 18th
day of November, 2004, by and between FT-FIN ACQUISITION LLC, a Delaware
limited liability company having an address c/o First Union Real Estate Equity
and Mortgage Investments, 7 Bulfinch Place, Suite 500, P.O. Box 9507, Boston,
Massachusetts 02114 (the “Borrower”), KEYBANK NATIONAL ASSOCIATION, a national
banking association, having an address at 127 Public Square, Cleveland, Ohio
44114, NEWSTAR CP FUNDING LLC, a Delaware limited liability company, having an
address c/o Newstar Financial, Inc., 101 Federal Street, Suite 1900, Boston, MA
02110, and the other lending institutions which are, or may become, parties to
this Agreement pursuant to Section 13.22 (singly and collectively, the “Lenders”),
KEYBANK NATIONAL ASSOCIATION, a national banking association, with a place of
business at 127 Public Square, Cleveland, Ohio 44114, as agent for itself and
such other lending institutions (the “Agent”), and KEYBANC CAPITAL MARKETS, as
the Arranger.

 

WITNESSETH:

 

ARTICLE 1

 

BACKGROUND.

 

1.1                                 Defined Terms.  Capitalized terms used in this Agreement are
defined either in Exhibit A, or in specific sections of this Agreement,
or in another Loan Document, as referenced in Exhibit A.

 

1.2                                 Borrower.  The Borrower is a limited liability company
organized under the laws of the State of Delaware of which the sole member is Park
Plaza Mall, LLC (“Park Plaza”), a Delaware limited liability company, of which
the sole member is First Union.

 

1.3                                 Use of Loan
Proceeds.  The Borrower has applied
to Lenders for a loan of up to FIFTY-THREE MILLION DOLLARS ($53,000,000.00)
(the “Loan”), the proceeds of which are to be used to assist the Borrower with
its acquisition of certain assets from Finova Capital Corporation and certain
related entities consisting of a portfolio of sixteen (16) owned or leased properties
with an aggregate of 2,500,000 square feet (the “Acquisition”), to pay certain
closing and transactional costs as approved by the Agent, to provide funding
for a working capital of the Borrower and its Subsidiaries, all in accordance
with the schedule of sources and uses annexed hereto as Exhibit B.

 

1.4                                 Guaranties.  As an inducement to Lenders to make the Loan,
First Union (on a limited basis), FT-FIN GP LLC and FT-Orlando Property LLC, each
a Delaware limited liability company, and FT-Churchill Property L.P., a
Delaware limited partnership (in such capacity, severally and collectively
called “Guarantor”) have agreed to furnish certain guaranties and indemnities to
the Agent with respect to the Loan.

 

1.5                                 Loan.  Subject to all of the terms, conditions and
provisions of this Agreement, and of the agreements and instruments referred to
herein, each of the Lenders agrees severally to make a loan to the Borrower equal
to such Lender’s Commitment (the “Loan”), and the Borrower agrees to accept and
repay the Loan.

 

 

ARTICLE 2

 

LOAN
PROVISIONS.

 

2.1                                 Amount of Loan.

 

2.1.1                        In no
event shall the aggregate amount of the Loan and Total Commitment exceed $53,000,000.00.

 

2.1.2                        Advances
under the Loan shall be disbursed as follows:

 

(a)                                  The
initial Loan Advance from the Lenders to the Borrower (the “Initial Advance”)
shall be in an amount equal to $27,000,000.00.

 

(b)                                 The
remaining amount of the Loan (up to $26,000,000.00) (the “Subsequent Advance”) from
the Lenders to the Borrower may be made in the form of a single subsequent Loan
Advance as requested by Borrower at Borrower’s sole option prior to December 31,
2004, subject to satisfaction of the conditions set forth in Section 5.20.

 

2.1.3                        Any and
all advances of proceeds of the Loan shall be made by the Lenders pro rata in
accordance with each Lender’s Percentage.

 

2.2                                 Term of Loan;
Extension Rights.  The Loan shall be
for a term (“Initial Term”) commencing on the date hereof and ending on November 18,
2007 (“Maturity Date”).  The Initial Term
of each Loan may be extended for one (1) year (“First Extended Term”) until November 18,
2008 (“First Extended Maturity Date”) and thereafter may be further extended
for an additional one (1) year (“Second Extended Term”) until November 18,
2009 (“Second Extended Maturity Date”), in each instance upon satisfaction of
the conditions set forth in Section 2.8 
(hereinafter, the First Extended Term and the Second Extended Term may
be referred to herein sometimes as the “Extended Term” as may be applicable) (hereinafter,
the First Extended Maturity Date and the Second Extended Maturity Date may be
referred to herein sometimes as the “Extended Maturity Date” as may be
applicable).

 

2.3                                 Interest Rate and
Payment Terms.  The Loan shall be
payable as to interest and principal in accordance with the provisions of this
Agreement and the Note.  This Agreement also
provides for interest at a Default Rate, Late Charges and prepayment rights and
fees.  All payments for the account of
Lenders made by the Borrower shall be applied to the respective accounts of the
Lenders in accordance with each Lender’s Percentage of the Loan.  The Agent will disburse such payments to the
Lenders on the date of receipt thereof if received prior to 10:00 a.m. on such
date and, if not, on the next Business Day. 
Any and all interest rate selection and conversion provisions in this
Agreement are to be administered by the Agent and to be allocated on a pro rata
basis to the portion of the balance due under the Notes held by each Lender
based upon such Lender’s Percentage.

 

2.4                                 Interest Rate.

 

2.4.1                        The Loan
will bear interest at the Applicable Rate, unless the Default Rate is applicable.  The Adjusted Prime Rate shall be the “Applicable
Rate”, except that the

 

2

 

Adjusted LIBOR Rate shall
be the “Applicable Rate” with respect to portions of the Loan as to which a
LIBOR Rate Option is then in effect.  For
each disbursement of proceeds of the Loan, Borrower shall deliver to Agent
irrevocable notice (which may be verbal notice provided that Borrower delivers
to Agent facsimile confirmation or electronic mail confirmation within twenty
four (24) hours of such verbal notice) of the requested amount of such
disbursement (x) if such disbursement is to bear interest at the Adjusted Prime
Rate, not later than 11:00 a.m. Eastern Time on the second Business Day prior
to the desired date of disbursement and (y) if such disbursement is to bear
interest at an Adjusted LIBOR Rate, not later than 11:00 a.m. Eastern Time on
the third Business Day prior to the desired date of disbursement.  Commencing January 1, 2005, Borrower
shall pay interest in arrears on the first day of every calendar month in the
amount of all interest accrued and unpaid on the Loan.  All payments (whether of principal or of
interest) shall be deemed credited to Borrower’s account only if received by
12:00 noon Eastern Time on a Business Day; otherwise, such payment shall be
deemed received on the next Business Day.

 

2.4.2                        Provided
that no Event of Default exists, Borrower shall have the option (the “LIBOR
Rate Option”) to elect from time to time in the manner and subject to the conditions
hereinafter set forth an Adjusted LIBOR Rate as the Applicable Rate for all or
any portion of the Loan which would otherwise bear interest at the Adjusted
Prime Rate.

 

2.4.3                        The only
manner in which Borrower may exercise the LIBOR Rate Option is by giving Agent
irrevocable notice (which may be verbal notice provided that Borrower delivers
to Agent facsimile confirmation in the form of Exhibit H attached hereto
within twenty-four (24) hours) of such exercise not later than 11:00 a.m.
Eastern Time on the second LIBOR Business Day prior to the proposed
commencement of the relevant LIBOR Rate Interest Period, which written notice
shall specify:  (i) the portion of the
Loan with respect to which Borrower is electing the LIBOR Rate Option, (ii) the
LIBOR Business Day upon which the applicable LIBOR Rate Interest Period is to
commence and (iii) the duration of the applicable LIBOR Rate Interest
Period.  The Applicable Rate for any
portion of the Loan with respect to which Borrower has elected the LIBOR Rate
Option shall revert to the Adjusted LIBOR Rate with a LIBOR Rate Interest
Period of one-month (the “One-Month LIBOR Rate”), as of the last day of the
LIBOR Rate Interest Period applicable thereto (unless Borrower again exercises
the LIBOR Rate Option for such portion of the Loan).  Agent shall be under no duty to notify
Borrower that the Applicable Rate on any portion of the Loan is about to revert
from an Adjusted LIBOR Rate to the One-Month LIBOR Rate.  The LIBOR Rate Option may be exercised by
Borrower only with respect to any portion of the Loan equal to or in excess of
$500,000.00. At no time may there be more than four (4) LIBOR Rate Interest
Periods in effect with respect to the Loan.

 

2.4.4                        If Agent
determines (which determination shall be conclusive and binding upon Borrower,
absent manifest error) (i) that Dollar deposits in an amount approximately
equal to the portion of the Loan for which Borrower has exercised the LIBOR
Rate Option for the designated LIBOR Rate Interest Period are not generally available
at such time in the London interbank market for deposits in Dollars, (ii) that
the rate at which such deposits are being offered will not adequately and
fairly reflect the cost to any Lender of maintaining a LIBOR Rate on such
portion of the Loan or of

 

3

 

funding the same for such
LIBOR Rate Interest Period due to circumstances affecting the London interbank
market generally, (iii) that reasonable means do not exist for ascertaining a
LIBOR Rate, or (iv) that an Adjusted LIBOR Rate would be in excess of the
maximum interest rate which Borrower may by law pay, then, in any such event,
to the extent that such Lender makes such determination generally with respect
to its borrowers who borrow funds at a rate based upon the LIBOR Rate, Agent
shall so notify Borrower and all portions of the Loan bearing interest at an
Adjusted LIBOR Rate that are so affected shall, as of the date of such
notification with respect to an event described in clause (ii) or (iv)
above, or as of the expiration of the applicable LIBOR Rate Interest Period
with respect to an event described in clause (i) or (iii) above,
bear interest at the Adjusted Prime Rate until such time as the situations
described above are no longer in effect or can be avoided by Borrower
exercising a LIBOR Rate Option for a different LIBOR Rate Interest Period.

 

2.4.5                        Interest
at the Applicable Rate (or Default Rate) shall be calculated for the actual
number of days elapsed on the basis of a 360-day year, including the first date
of the applicable period to, but not including, the date of repayment.

 

2.4.6                        Borrower
shall pay all Breakage Costs incurred from time to time by Lender upon demand
within fifteen (15) Business Days of receipt of written notice from Agent.

 

2.4.7                        If the
introduction of or any change in any law, regulation or treaty, or in the
interpretation thereof by any Governmental Authority charged with the
administration or interpretation thereof, shall make it unlawful for any Lender
to maintain the Applicable Rate at an Adjusted LIBOR Rate with respect to the
Loan or any portion thereof, or to fund the Loan or any portion thereof in
Dollars in the London interbank market, or to give effect to its obligations
regarding the LIBOR Rate Option as contemplated by the Loan Documents, then, to
the extent that such Lender makes such determination generally with respect to
its borrowers who borrow funds at a rate based upon the LIBOR Rate, (1) Agent
shall notify Borrower that such Lender is no longer able to maintain the
Applicable Rate at an Adjusted LIBOR Rate, (2) the LIBOR Rate Option shall
immediately terminate, (3) the Applicable Rate for any portion of the Loan for
which the Applicable Rate is then an Adjusted LIBOR Rate shall automatically be
converted to the Adjusted Prime Rate, and (4) Borrower shall pay to Agent the
amount of Breakage Costs (if any) incurred by such Lender in connection with
such conversion.  Thereafter, Borrower
shall not be entitled to exercise the LIBOR Rate Option until such time as the
situation described herein is no longer in effect or can be avoided by Borrower
exercising a LIBOR Rate Option for a different LIBOR Rate Interest Period.  So long as no Event of Default has occurred
and is continuing, upon written demand of Borrower, the Borrower may with
thirty (30) days written notice to the Agent, require any such Lender unable to
maintain the Applicable Rate at an Adjusted LIBOR Rate pursuant to this Section 2.4.7
to sell and assign its entire interest in the Loan pursuant to Section 13.22
hereof to any Eligible Assignee identified by the Borrower in its demand and
reasonably approved by the Agent, upon payment by such Eligible Assignee of the
entire par amount of such Lender’s interest in the Loan, plus any applicable
Breakage Costs.

 

4

 

2.5                                 Principal. 

 

2.5.1                        Scheduled
Payments.

 

(a)                                  Commencing
January 15, 2005, and continuing semiannually on the fifteenth day of each
July and January thereafter, the Borrower, in addition to any other
principal payments or prepayments required hereunder, Borrower shall make the
following payments:

 

(i)                                     The
July 15 payment shall be equal to 50% of the sum of :

 

(A)                              (1)
the amount of the Borrower’s Net Cash Flow for the two fiscal quarters just
ending, less (2) the aggregate amount of interest on the Loan paid by the Borrower during the last two
fiscal quarters just ending plus the aggregate amount of interest on the Loan
projected to be paid by the Borrower through November of the same year as
determined solely by the Agent in a manner consistent with the procedures and
methods utilized by the Agent in analyzing the financial information provided
by the Borrower prior to closing.

 

(ii)                                  The
January 15 payment shall be equal to 50% of (i) the Net Cash Flow for the two
fiscal quarters just ending, (ii) less any interest payments made in December under
the Loan.  In no event shall the payments
due pursuant to this Section 2.5.1 (a) for any calendar year be less than
an amount equal to 50% of (a) Net Cash Flow (b) less the interest paid under
the Loan for such year.  The Officer’s
Certificate provided by the Borrower to Lender pursuant to Section 7.2.1(q)
shall detail the calculation of each such scheduled principal payment
hereunder.  To the extent the Maturity
Date is extended to any Extended Maturity Date, the required quarterly
principal payment set forth above shall continue to be due on the dates set
forth above.  The entire principal
balance of the Loan shall be due and payable in full on the Maturity Date (or
as may be applicable, any Extended Maturity Date).

 

(b)                                 Mandatory
Principal Repayments.  In addition to the
scheduled payments of principal, as provided above, the Borrower shall make the
following mandatory prepayments of principal (singly and collectively, the “Mandatory
Principal Prepayments”) each of which shall be due and payable on the later of
(x) within five (5) Business Days of the event giving rise to such Mandatory
Principal Prepayment obligation (the “Mandatory Prepayment Event”) or (y)
within three (3) Business Days of written demand therefor by the Agent;
provided, however, at the request of the Borrower, the Agent agrees to hold the
amount of any such Mandatory Principal Prepayment in the Mandatory Principal
Payment Account (as defined in the Cash Management Agreement, pledged to the
Agent, on behalf of the Lenders, to secure the repayment of the Obligations),
until the earlier of (x)  the expiration
of any relevant Interest Period so that the prepayment can be made without the
Borrower incurring any costs under Section 2.5.7 or (y) ninety (90) days:

 

5

 

(i)                                     An
amount equal to the greater of (a) one hundred (100%) percent of the Net Sales
Proceeds, as determined in the reasonable judgment of the Agent, (x) received
by any Borrower Subsidiary from the sale, transfer, or other disposition of any
Individual Property or any portion thereof or (y) received by the Borrower from
the sale, transfer, dissolution, or other disposition of the ownership interest
in any Borrower Subsidiary, or (b) the Allocated Loan Amount for such
Individual Property;

 

(ii)                                  An
amount equal to the greater of (a) one hundred (100%) percent of the Net Sales
Proceeds, as determined in the reasonable judgment of the Agent, (x)
distributed to any ownership interest held by the Borrower or FT-FIN GP from
the sale, transfer, or other disposition of any Individual Property or any
portion thereof by a Property Owner (based upon the aggregate percentage ownership
interest therein) or (y) received by the Borrower, FT-FIN GP, or any other Loan
Party from the sale, transfer, dissolution, or other disposition of the
ownership interest in any Property Owner, or (b) the Allocated Loan Amount for
such Individual Property;

 

(iii)                               One
hundred (100%) percent of the Net Refinancing Proceeds, as determined in the
reasonable judgment of the Agent, (x) received by any Borrower Subsidiary from
any financing or refinancing of any Individual Property or any portion thereof
or (y) received by the Borrower or FT-FIN GP from the financing or refinancing
of any Individual Property by a Property Owner (based upon the aggregate
percentage ownership interest therein);

 

(iv)                              An
amount equal to the greater of (a) one hundred (100%) percent of the Net Sales
Proceeds, as determined in the reasonable judgment of the Agent, (x) received
by any Borrower Subsidiary from an Economic Discontinuance Sale of any
Individual Property or any portion thereof or (y) received by the Borrower or FT-FIN
GP from an Economic Discontinuance Sale of any Individual Property or any
portion thereof, or (b) the Allocated Loan Amount for such Individual Property;

 

(v)                                 An
amount equal to the greater of (a) one hundred (100%) percent of the Net
Proceeds, as determined in the reasonable judgment of the Agent, received by
any Borrower Subsidiary or distributed to any ownership interest held by the
Borrower or FT-FIN GP from any casualty or taking regarding any Individual
Property or any portion thereof owned by a Property Owner which proceeds are
not to be utilized within a reasonable period of time following such event for
the repair or reconstruction thereof (based upon the aggregate percentage ownership
interest therein), or (b) the Allocated Loan Amount for such Individual
Property;

 

(vi)                              An
amount equal to the greater of (a) one hundred (100%) percent of the Net Sales
Proceeds, as determined in the reasonable

 

6

 

judgment of the Agent, received
by any Borrower Subsidiary or distributed to any limited partnership,
membership or other ownership interest held by the Borrower or FT-FIN GP from
the sale, transfer, or other disposition of any asset (other than a sale of any
Individual Property) of any Borrower Subsidiary (based upon the aggregate percentage
ownership interest therein), or (b) the Allocated Loan Amount for such
Individual Property.

 

Any Mandatory Principal Prepayment shall be applied to then outstanding
principal balance due under the Loan.

 

(c)                                  Prepayment.  Notwithstanding anything to the contrary
contained in this Agreement or any of the other Loan Documents to the contrary,
the Loan or any portion thereof may be prepaid in whole or in part by the
Borrower on any Business Day during the term of the Loan, upon five (5) days’
prior written notice to the Agent.  Any
prepayment made pursuant to the foregoing shall be accompanied by the payment
of interest accrued through the date of prepayment and the payment of any
applicable Breakage Costs.

 

2.5.2                        Maturity.  At maturity all accrued interest, principal
and other charges due with respect to the Loan shall be due and payable in full
and the principal balance and such other charges, but not unpaid interest,
shall bear interest at the Default Rate until so paid.

 

2.5.3                        Method
of Payment; Date of Credit.  All
payments of interest, principal and fees shall be made in lawful money of the
United States in immediately available funds, without counterclaim or set off
and free and clear, and without any deduction or withholding for, any taxes
(other than income taxes or franchise taxes of any Lender) or other payments
(a) by direct charge to an account of Borrower maintained with Agent (or then
holder of the Loan), or (b) by wire transfer to Agent or to such other bank or
address as the holder of the Loan may designate in a written notice to
Borrower.  Payments shall be credited on
the Business Day on which immediately available funds are received prior to
12:00 noon Cleveland Time; payments received after 12:00 noon Eastern Time
shall be credited to the Loan on the next Business Day; payments which are by
check, which Agent may at its option accept or reject, or which are not in the
form of immediately available funds shall not be credited to the Loan until
such funds become immediately available to Agent, and, with respect to payments
by check, such credit shall be provisional until the item is finally paid by
the payer bank.

 

2.5.4                        Billings.  Agent may submit monthly billings reflecting
payments due from the Borrower; however, any changes in the interest rate which
occur between the date of billing and the due date may be reflected in the
billing for a subsequent month.  Neither
the failure of Agent to submit a billing nor any error in any such billing
shall excuse the Borrower from the obligation to make full payment of the
Borrower’s payment obligations when due.

 

2.5.5                        Default
Rate.  Agent shall have the option of
imposing (and shall upon demand of the Required Lenders impose), and Borrower
shall pay upon billing therefor, an interest rate which is four percent (4%)
per annum above the interest rate otherwise

 

7

 

payable (“Default Rate”):  (a) following any Event of Default,
unless and until the Event of Default is cured with the consent of Required
Lenders or waived by Required Lenders; and (b) after Maturity.  Borrower’s right to select LIBOR pricing
options shall be suspended upon the occurrence and during the continuance of a
monetary Default or following any Event of Default or at Maturity.

 

2.5.6                        Late
Charges.  The Borrower shall pay,
upon billing therefor, a “Late Charge” equal to five percent (5%) of the amount
of any regularly scheduled payment of principal (other than principal due at
Maturity or any Mandatory Principal Prepayment), interest, or both, which is
not paid within ten (10) days of the due date thereof (other than with respect
to any payment as to which the said ten (10) day period expires after the
implementation of the Default Rate). 
Late charges are: (a) except as provided above, payable in addition to,
and not in limitation of, the Default Rate, (b) intended to compensate Agent
for administrative and processing costs incident to late payments, (c) are not
interest, and (d) shall not be subject to refund or rebate or credited against any
other amount due.

 

2.5.7                        Prepayment
Costs.  The Borrower shall pay to
Agent, immediately upon request and notwithstanding contrary provisions
contained in any of the Loan Documents, such amounts as shall, in the
conclusive judgment of Agent (in the absence of manifest error), compensate
Agent and the Lenders for the loss, cost or expense which they may reasonably
incur as a result of (i) any payment or prepayment, under any circumstances
whatsoever, whether voluntary or involuntary, of all or any portion of an Adjusted
LIBOR Rate Advance on a date other than the last day of the applicable Interest
Period of an Adjusted LIBOR Rate Advance, (ii) the conversion, for any reason
whatsoever, whether voluntary or involuntary, of any Adjusted LIBOR Rate
Advance to a Adjusted Prime Rate Advance on a date other than the last day of
the applicable Interest Period, (iii) the failure of all or a portion of a Loan
which was to have borne interest at the Adjusted LIBOR Rate pursuant to the
request of Borrower to be made under the Loan Agreement (except as a result of
a failure by any Lender to fulfill such Lender’s obligations to fund), or (iv)
the failure of the Borrower to borrow in accordance with any request submitted
by it for an Adjusted LIBOR Rate Advance. 
Such amounts payable by the subject Borrower shall be equal to (a) any
administrative costs actually incurred plus (b) the Breakage Costs.

 

2.6                                 Fees.

 

2.6.1                        Loan
Fees.  Borrower shall pay on the
Closing Date a commitment fee to the Agent as and when provided in the addendum
to the commitment letter between the Borrower and the Agent.  The commitment fee shall be based upon the
amount of the Total Commitment and shall be fully earned by the Agent on the
Closing Date, regardless of whether any Loan Advance is made subsequent to the Initial
Advance.  Upon the funding of a
subsequent advance, the Borrower shall pay the additional fee to the Agent as set
forth in the written agreement with the Agent.

 

2.6.2                        Extension
Fees.  The Borrower shall pay to the
Agent for the account of the Lenders “Extension Fees” (so referred to herein)
in amounts representing one quarter of one percent (0.25%) of then outstanding
principal balance of the Loan at the Maturity Date (and at the First Extended
Maturity Date, as applicable), on each occasion, in

 

8

 

connection with the
Borrower’s exercise of its extension rights, and as a condition precedent to
the effectiveness thereof, in each instance, as provided in Section 2.8.

 

2.7                                 Acceleration.  The Agent may, and upon the request of the
Required Lenders shall, accelerate the applicable Loan, after the occurrence
and during the continuance of an Event of Default.  Upon such an acceleration, all principal,
accrued interest and costs and expenses shall be due and payable together with
interest on such principal at the Default Rate and any applicable Prepayment
Fee and any amounts due under Section 2.5.7.

 

2.8                                 Conditions to
Extending Loan.  Upon satisfaction of
each of the following conditions, the Borrower may extend its respective Loan
until the First Extended Maturity Date, and thereafter, again upon satisfaction
of each of the following conditions, the Borrower may further extend its
respective Loan until the Second Extended Maturity Date:

 

2.8.1                        No
Default.  No Default with respect to the
Borrower shall exist on the date of the Borrower’s written notice for an
extension as provided for below and on the Maturity Date (or as may be
applicable, the First Extended Maturity Date).

 

2.8.2                        Notice
From Borrower.  Such Borrower shall
have given Agent written notice of its request to exercise its extension right
at least forty-five (45) days, but no more than ninety (90) days, before the
Maturity Date (or as may be applicable, the First Extended Maturity Date).

 

2.8.3                        Covenant
Compliance.  No breach of any
covenants imposed upon the Borrower shall exist including, without limitation,
the Financial Covenants;

 

2.8.4                        Exercise
of Ground Lease Extension Options.  The
Borrower shall or shall cause the applicable Property Owner to duly exercise,
in a timely manner, all Ground Lease Extension Options as to which the final
date to exercise such Ground Lease Extension Options is within thirteen (13)
months of the First Extended Maturity Date (as of the Closing Date, the
applicable Ground Lease Extension Options are detailed on Schedule 2.8.4);

 

2.8.5                        Conditions
Satisfied.  All of the conditions set
forth in Section 0 of this Agreement, to the extent applicable to the
subject Loan being extended, shall continue to be satisfied;

 

2.8.6                        Extension
Fee.  The Extension Fee of 0.25% of
the Loan being extended referred to in Section 2.6 shall have been paid at
least five (5) days prior to the Maturity Date (or as may be applicable, the
First Extended Maturity Date) and shall be returned to the subject Borrower if
the Loan is not extended for any reason;

 

2.8.7                        Additional
Documents.  The Borrower and each
Guarantor shall have executed and delivered to Agent such agreements and
documents as Agent may reasonably require to effectuate the extension;
provided, however, none of said requested agreements or documents shall provide
for additional collateral or include any substantive modification of the terms
and provisions of the Loan Documents;

 

9

 

2.8.8                        Interest
Rate Protection.  The applicable
Borrower shall have entered into an Interest Rate Protection Agreement, from an
issuer and in form and substance reasonably acceptable to the Agent, with
respect to the subject Loan, which Interest Rate Protection Agreement shall be
collaterally assigned to the Agent, on behalf of the Lenders, to secure the
Loan being extended; and

 

2.8.9                        Before
End of Term.  Each of the foregoing
conditions are satisfied not later than, and on, the Maturity Date (or as
applicable, the First Extended Maturity Date).

 

Within twenty (20) days following receipt by Agent of
Borrower’s written notice under clause 2.8.2 above requesting the extension
accompanied by the items described in Section 2.8, Agent shall notify the
Borrower in writing if all of the conditions precedent to the extension, other
than payment of the extension fee, have been satisfied, or if further
information or documents set forth in Section 2.8 are required, specifying
such missing information or documents. 
If Agent determines that the conditions to extension have been satisfied
(or if the Agent notified the Borrower as provided above of any outstanding
information or documents required by this Section 2.8, specifying such
missing information or documents, and the Borrower provides outstanding
information or documents prior to ten (10) days before the Maturity Date (or as
may be applicable, the First Extended Maturity Date)), other than payment of
the Extension Fee, Agent shall so notify the Borrower and upon Agent’s receipt
of the Extension Fee not later than five (5) days prior to the Maturity Date
(or as may be applicable, the First Extended Maturity Date), so long as no
Default exists, the term of the subject Loan shall be extended until the First Extended
Maturity Date (or as may be applicable, the Second Extended Maturity Date).

 

2.9                                 Increased Costs and
Capital Adequacy.

 

2.9.1                        Borrower
recognizes that the cost to any Lender of maintaining the Loan or any portion
thereof may fluctuate and, to the extent that such Lender makes such
determination generally with respect to similarly situated borrowers, Borrower
agrees to pay Agent additional amounts to compensate any such Lender for any
increase in its actual costs incurred in maintaining the Loan or any portion
thereof outstanding or for the reduction of any amounts received or receivable
from Borrower as a result of:

 

(a)                                  any
change after the date hereof in any applicable law, regulation or treaty, or in
the interpretation or administration thereof, or by any domestic or foreign
court, (A) changing the basis of taxation of payments under this Agreement to
any Lender (other than taxes imposed on all or any portion of the overall net
income or receipts of Lenders or franchise taxes), or (B) imposing, modifying
or applying any reserve, special deposit or similar requirement against assets
of, deposits with or for the account of, credit extended by, or any other
acquisition of funds for loans by any Lender (which includes the Loan or any
applicable portion thereof) (provided, however, that Borrower shall not be
charged again the Reserve Percentage already accounted for in the definition of
the Adjusted LIBOR Rate), or (C) imposing on any Lender, or the London
interbank market generally, any other condition affecting the Loan, provided
that the result of the foregoing is to increase the cost to any Lender of
maintaining the

 

10

 

Loan or any portion thereof or to reduce the
amount of any sum received or receivable from Borrower by any Lender under the
Loan Documents; or

 

(b)                                 the
maintenance by any Lender of reserves in accordance with reserve requirements
promulgated by the Board of Governors of the Federal Reserve System of the
United States with respect to “Eurocurrency Liabilities” of a similar term to
that of the applicable portion of the Loan (without duplication for reserves
already accounted for in the calculation of a LIBOR Rate pursuant to the terms
hereof).

 

So long as no Event of Default has occurred and is continuing, upon
written demand of Borrower, the Borrower may with thirty (30) days’ written
notice to the Agent, require any such Lender whose costs of maintaining the
Loan or any portion thereof has increased as provided for in this Section 2.9.1
to sell and assign its entire interest in the Loan pursuant to Section 13.22
hereof to any Eligible Assignee identified by the Borrower in its demand and
reasonably approved by the Agent, upon payment by such Eligible Assignee of the
entire par amount of such Lender’s interest in the Loan, plus any compensation
required to be paid hereunder and any applicable Breakage Costs.

 

2.9.2                        If the
application of any law, rule, regulation or guideline adopted or arising out of
the report of the Basle Committee on Banking Regulations and Supervisory
Practices entitled “International Convergence of Capital Measurement and
Capital Standards”, or the adoption after the date hereof of any other law,
rule, regulation or guideline regarding capital adequacy, or any change after
the date hereof in any of the foregoing, or in the interpretation or
administration thereof by any domestic or foreign Governmental Authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender, with any request or
directive regarding capital adequacy (whether or not having the force of law)
of any such authority, central bank or comparable agency, has the effect of
reducing the rate of return on such Lender’s capital to a level below that
which such Lender would have achieved but for such application, adoption,
change or compliance (taking into consideration the policies of such Lender
with respect to capital adequacy), then, to the extent that such Lender
requires such compensation generally with respect to similarly situated
borrowers, from time to time Borrower shall pay to such Lender such additional
amounts as will compensate such Lender for such reduction with respect to any
portion of the Loan outstanding.  So long
as no Event of Default has occurred and is continuing, upon written demand of
Borrower, the Borrower may with thirty (30) days written notice to the Agent,
require any such Lender to whom compensation is due and payable by the Borrower
as provided for in this Section 2.9.2 to sell and assign its entire
interest in the Loan pursuant to Section 13.22 hereof to any Eligible
Assignee identified by the Borrower in its demand and reasonably approved by
the Agent, upon payment by such Eligible Assignee of the entire par amount of
such Lender’s interest in the Loan, plus any compensation required to be paid
hereunder and any applicable Breakage Costs.

 

2.9.3                        Any amount
payable by Borrower under subsection 2.9.1 or 2.9.2 above shall be paid
within five (5) days of receipt by Borrower of a certificate signed by an
authorized officer of Agent setting forth the amount due and the basis for the
determination of such amount, which statement shall be conclusive and binding
upon Borrower, absent manifest error. 
Failure on the part of Agent to demand payment from

 

11

 

Borrower for any such
amount attributable to any particular period shall not constitute a waiver of
Lender’s right to demand payment of such amount for any subsequent or prior period.
Agent shall use reasonable efforts to deliver to Borrower prompt notice of any
event described in subsection 2.9.1 or 2.9.2 above, of the amount of the
reserve and capital adequacy payments resulting therefrom and the reasons
therefor and of the basis of calculation of such amount; provided, however,
that any failure by Agent so to notify Borrower shall not affect Borrower’s
obligation to pay the reserve and capital adequacy payment resulting therefrom.

 

2.10                           Borrower Withholding.  If by reason of a change in any applicable
laws occurring after the date hereof, or, as to an Eligible Assignee acquiring
an interest in the Loan after the date hereof, after such Eligible Assignee
purchases such interest in the Loan, Borrower is required by law to make any deduction
or withholding in respect of any taxes (other than taxes imposed on or measured
by the net income of any Lender or any franchise tax imposed on any Lender),
duties or other charges from any payment due under the Note to the maximum
extent permitted by law, to the extent that such Lender imposes such
requirement generally with respect to similarly situated borrowers, the sum due
from Borrower in respect of such payment shall be increased to the extent
necessary to ensure that, after the making of such deduction or withholding,
each Lender receives and retains a net sum equal to the sum which it would have
received had no such deduction or withholding been required to be made.  So long as no Event of Default has occurred
and is continuing, upon written demand of Borrower, the Borrower may with
thirty (30) days written notice to the Agent, require any such Lender requiring
the Borrower to make such deductions or withholdings as set forth in this Section 2.10
to sell and assign its entire interest in the Loan pursuant to Section 13.22
hereof to any Eligible Assignee identified by the Borrower in its demand and
reasonably approved by the Agent, upon payment by such Eligible Assignee of the
entire par amount of such Lender’s interest in the Loan, plus any amounts
required to be paid hereunder and any applicable Breakage Costs.

 

2.11                           Interest Rate Agreements.

 

2.11.1                  Any indebtedness
incurred pursuant to an Interest Rate Agreement entered into by Borrower and
Agent shall constitute indebtedness evidenced by the Note and secured by the
other Loan Documents to the same extent and effect as if the terms and
provisions of such Interest Rate Agreement were set forth herein, whether or
not the aggregate of such indebtedness, together with the disbursements made by
Lenders of the proceeds of the Loan, shall exceed the face amount of the Note.

 

2.11.2                  Borrower hereby
collaterally assigns to Agent for the benefit of Lenders any and all Interest
Rate Protection Products purchased or to be purchased by Borrower in connection
with the Loan, as additional security for the Loan, and agrees to provide
Lenders with any additional documentation requested by Lenders in order to
confirm or perfect such security interest during the term of the Loan.  If Borrower obtains an Interest Rate
Protection Product from a party other than Agent, Borrower shall deliver to
Lenders such third party’s consent to such collateral assignment.  No Interest Rate Protection Product purchased
from a third party may be secured by an interest in Borrower or the Collateral.

 

2.11.3                  Borrower shall,
as a condition to the opening of the Loan if required by Lenders and otherwise
within five (5) Business Days after Agent’s request, institute an

 

12

 

interest rate hedging
program through the purchase of an Interest Rate Protection Product with
respect to the Loan.  The Interest Rate
Protection Product, the portion of the Loan (if less than the entire Loan
Amount) to which such Interest Rate Protection Product shall apply, and the
financial institution providing the Interest Rate Protection Product, shall be
subject to Agent’s prior written approval in its sole discretion.  Borrower shall afford Agent a right of first
opportunity to provide all Interest Rate Protection Products but shall not be
required to purchase such Interest Rate Protection Products from Agent or any
Lender.

 

ARTICLE 3

 

SECURITY
FOR THE LOAN; LOAN AND SECURITY DOCUMENTS.

 

3.1                                 Security for Loan.  The Loan, together with interest thereon and
all other charges and amounts payable by, and all other Obligations of, the
Borrower and the other Loan Parties to the Agent and/or each of the Lenders,
shall be secured by the following collateral (the “Collateral”) which the
Borrower agrees to provide and maintain, or cause to be provided and maintained
(whether provided for each in separate agreements or combined with various
other agreements):

 

3.1.1                        Security
Agreement.  A first priority security
agreement and collateral assignment granted by the Borrower to the Agent, on
behalf of the Lenders, respecting all assets of the Borrower, whether now
owned, now due, or in which the Borrower has an interest, or hereafter, at any
time in the future, acquired, arising, to become due, or in which the Borrower obtains
an interest.

 

3.1.2                        Mortgages.  A first priority leasehold mortgage, security
agreement, and assignment of leases and rents granted by (a) the Churchill
Owner respecting the Churchill Property, and (b) the Orlando Owner respecting
the Orlando Property; provided, however, that the Agent agrees to hold the
mortgage granted by the Orlando Owner in escrow and shall not record same until
such time as an Event of Default has occurred and is continuing.

 

3.1.3                        Borrower
Ownership Interest Pledge and Security Agreements.  First priority Ownership Interest Pledge and
Security Agreements granted by the Borrower to the Agent, on behalf of the
Lenders, with respect to all right, title, and interest of the Borrower to and
in each of the following:

 

(a)                                  The
Borrower’s 100% limited partnership interests in each of the Borrower
Partnerships, as of the Funding Date to be as set forth in Exhibit M annexed
hereto; and

 

(b)                                 The
Borrower’s 100% membership interest in each of the Borrower LLCs, as of the
Funding Date to be as set forth in Exhibit M annexed hereto.

 

3.1.4                        Depository
Account Pledge and Security Agreements. 
A first priority Depository Account Pledge and Security Agreement
granted by the Borrower and each Guarantor to the Agent, on behalf of the
Lenders, respecting all of the Borrower’s

 

13

 

Accounts maintained by
such Persons at KEYBANK NATIONAL ASSOCIATION (or any successor thereto or
affiliate thereof) (singly and collectively the “Depository Account Pledge and
Security Agreement”).

 

3.1.5                        Collateral
Assignment of Interest Rate Protection Agreement.  A first priority Collateral Assignment of
Protected Interest Rate Agreement granted by the Borrower to the Agent, on
behalf of the Lenders, respecting the Interest Rate Protection Agreement
entered into with respect to the Loan.

 

3.1.6                        FT-FIN
GP Ownership Interest Pledge and Security Agreement.  A first priority Ownership Interest Pledge
and Security Agreement granted by FT-FIN GP to the Agent, on behalf of the
Lenders, with respect to all right, title, and interest of FT-FIN GP to and in its
general partner’s interest in each Borrower Partnership, respectively.

 

3.1.7                        Guaranties.

 

(a)                                  The
continuing guaranty from each Guarantor, pursuant to which each Guarantor shall
guaranty the prompt, punctual, and faithful payment of the Loan and the
performance of all other Obligations to the Agent and each of the Lenders under
the Loan Documents; provided, however, that any particular Guaranty may be on a
limited or non-recourse basis as, and only to the extent, specifically approved
by the Agent and provided in any such Guaranty (singly and collectively the “Guaranty”).

 

3.1.8                        Environmental
Compliance and Indemnification Agreement. 
A compliance and indemnification agreement with respect to environmental
matters (“Environmental Indemnity”) from the Borrower, First Union and each Guarantor
(collectively, the Indemnitor”) in favor of the Agent and each of the Lenders.

 

3.1.9                        Escrow
Agreement Respecting Mortgage.  An
escrow agreement (“Escrow Agreement Respecting Mortgage”) pursuant to which the
Borrower and Orlando Owner, respectively, execute and deliver in escrow to the
Agent, on behalf of the Lenders, the Mortgage on the Orlando Property.

 

3.1.10                  Escrow
Agreement Respecting Ground Lease Extensions and Lease Options.  An escrow agreement (“Escrow Agreement
Respecting Ground Lease Extensions and Lease Options”) pursuant to which the Borrower
and certain Property Owners, respectively and as applicable, execute and
deliver in escrow to the Agent, on behalf of the Lenders, executed notices and
such other documents and agreements required to exercise all extensions and
other rights respecting the following, as determined in the reasonable judgment
of the Agent.

 

(a)                                  Those
lease extension options (singly and collectively, the “Ground Lease Extension
Options”) relating to all ground lessor interests held by any party as detailed
on Schedule 2.8.4, whether with respect to a Ground Lease in effect
as of the date hereof and any other Ground Lease which may be entered into
hereafter, including any Ground Lease entered into in connection with the
exercise of a Remainder Ground Lease Option.

 

14

 

3.1.11                  Additional
Documents.  Any other documents,
instruments and agreements with respect to the Loan as set forth on the Loan
Agenda.

 

3.2                                 Loan Documents and Security
Documents.  The Loan shall be made,
evidenced, administered, secured and governed by all of the terms, conditions
and provisions of the “Loan Documents”, each as the same may be hereafter
modified or amended, consisting of: (i) this Loan Agreement; (ii) the
promissory notes in the form of Exhibit C, annexed hereto, payable by the
Borrower to each of the respective Lenders in the original aggregate principal amount
of up to FIFTY-THREE MILLION DOLLARS ($53,000,000.00) (collectively, the “Note”);
(iii) the various documents and agreements referenced in Section 3.1,
above; (iv) any Consents or Payment Direction Letters executed by any Borrower
Subsidiary; (v) the Interest Rate Protection Agreement, (vi) the Cash
Management Agreement; and (vii) any other documents, instruments, or agreements
heretofore or hereafter executed to further evidence or secure the Loan.

 

Each of the Loan
Documents listed above is dated as of the date hereof.  The Loan Documents referenced in Section 3.1
are sometimes referred to herein, singly and collectively as the “Security
Documents”.

 

ARTICLE 4

 

CONTINUING
AUTHORITY OF AUTHORIZED REPRESENTATIVES

 

4.1                                 Authorized
Representatives.  Agent and each of
the Lenders are authorized to rely upon the continuing authority of the
persons, officers, signatories or agents hereafter designated (“Authorized
Representatives”) to bind the Borrower with respect to all matters pertaining
to the Loan and the Loan Documents including, but not limited to, the selection
of interest rates, the submission of the request for the Loan Advance and
certificates with regard thereto.  Such
authorization may be changed only upon written notice to Agent accompanied by evidence,
reasonably satisfactory to Agent, of the authority of the person giving such
notice.  The present Authorized
Representatives as to the Borrower are listed on Exhibit D.  The Agent shall have a right of approval, not
to be unreasonably withheld or delayed, over the identity of the Authorized
Representatives so as to assure Agent and each of the Lenders that each
Authorized Representative is a responsible and senior official of the Borrower.

 

ARTICLE 5

 

CONDITIONS
PRECEDENT.

 

It shall be a condition precedent of Lenders’
obligation to close the Loan and to fund the Initial Advance that each of the
following conditions precedent be satisfied in full (as determined by each
Lender in its discretion which discretion shall be exercised in good faith
having due regard for the advice of the Agent), unless specifically waived in
writing by all of the Lenders at or prior to the date of the funding of the Initial
Advance (the date of the closing of the Loan shall be referred to herein as the
“Closing Date” and the date of the Initial Advance shall be referred to herein
as the “Funding Date”), and the Lenders shall, subject to compliance with all
of the other terms, conditions and provisions of this Agreement, make
disbursement of the Initial Advance on the Closing Date and shall, if so
requested by Borrower as and when provided in Section 5.20 and as
otherwise provided herein, make disbursement of the remaining Subsequent
Advance subject to the satisfaction of said following conditions precedent:

 

15

 

5.1                                 Satisfactory Loan
Documents and Related Documents; Loan Agenda Items.  On the Funding Date, each of the Loan
Documents and the Related Documents shall be satisfactory in form, content and
manner of execution and delivery to Agent and Agent’s counsel and all Loan
Documents and Related Documents shall be in full force and effect.  Without limiting the foregoing, the Agent
shall have received each of the instruments, documents, and agreements itemized
on the Loan Agenda, each executed and delivered in favor of, and/or in form and
substance reasonably satisfactory to, the Agent.

 

5.2                                 Financial
Information; No Material Change. 

 

(a)                                  No
change shall have occurred in the financial condition, business, affairs,
operations or control of the Borrower, the Loan Parties, and/or the other Loan
Parties since the date of their respective financial statements or financial
projections most recently delivered to Agent, which change has had or could
reasonably be expected to have a Material Adverse Effect; and the Borrower and
the other Loan Parties shall have furnished Agent such other financial
information, projections, and certifications as reasonably requested by the
Agent.

 

(b)                                 The
absence of any material adverse change in the loan syndication, financial or
capital market conditions generally from those currently in effect.

 

(c)                                  The
Borrower shall have provided to the Agent a copy certified by an officer of the
Borrower of its balance sheet after giving effect to the Loan, to evidence that
the Borrower is solvent, has assets having a fair value in excess of the amount
required to pay the Borrower’s probable liabilities on the Borrower’s existing
Debts as such become absolute and mature, and has adequate capital for the
conduct of the Borrower’s business and the ability to pay the Borrower’s Debts
from time to time incurred in connection therewith as such Debts mature.

 

5.3                                 Warranties and
Representations Accurate.  All
warranties and representations made by or on behalf of any of the Borrower and
the other Loan Parties, or any of them, to Agent or any of the Lenders shall be
true, accurate and complete in all material respects and, to the best of the
Borrower’s Knowledge, shall not omit any material fact necessary to make the
same not misleading.

 

5.4                                 Validity and
Sufficiency of Security Documents. 
The Security Documents shall create a valid and perfected lien on the Collateral
described therein and each of the Security Documents and related UCC filings
shall have been duly recorded and filed to the satisfaction of Agent and Agent’s
counsel, including, without limitation, as follows:

 

(a)                                  On
the Funding Date, the Borrower and the other Loan Parties shall have delivered
to the Agent evidence of the completion of all recordings and filings of, or
with respect to, the Security Documents or, in the case of UCC-1 financing
statements, delivery of such financing statements in proper form for recording,
and shall have taken all such other actions as may be necessary or, in the
reasonable opinion of the Agent, desirable to perfect the Liens and security
interests intended to be created by the Security Documents in the Collateral
covered thereby.  Such filings,
recordings and other actions shall include, without

 

16

 

limitation, in addition to the UCC-1
financing statements, (x) delivery to the Agent of the certificates, if any,
representing the respective partnership and membership interests in each
partnership and limited liability company, the partnership or membership
interests in which are being pledged to Agent on behalf of the Lenders pursuant
to the Security Documents, and (y) delivery to the Agent of all consents,
acknowledgments, and approvals relating in any way to the Security Documents as
the Agent in its reasonable discretion determines appropriate, including,
without limitation, those consents and approvals set forth in the Loan Agenda
with respect to the granting of the Security Documents and the acknowledgment
of the interests of the Agent and the Lenders created therein (the “Consents”);
and

 

(b)                                 on
or prior to the Funding Date, the Agent shall have received the results of a
UCC, tax lien and judgment search in the jurisdictions in which the Borrower,
the Borrower Subsidiaries, and the other Loan Parties, respectively, are
organized, have assets, or have their chief executive office, and the results
of such search shall indicate there are no judgments or Liens not permitted
under the Loan Documents.

 

5.5                                 Payment Direction
And Authorization. Agent shall have received evidence of such Payment
Direction Letters set forth in the Loan Agenda in order to evidence the
intended management of the cash flow of the Borrower and the other Loan Parties.

 

5.6                                 Litigation.  Except as noted on Schedule 6.5, on the
Funding Date, there shall not be any actions, suits or proceedings at law or in
equity or by or before any governmental instrumentality or other agency or
regulatory authority by any entity (private or governmental) pending or, to the
best of the Borrower’s Knowledge, threatened with respect to the Loan, the
transactions contemplated in the Loan Documents or any documentation executed
in connection therewith, or in connection with the Borrower or any other Loan
Party, which the Agent shall determine in good faith is likely to have a
Material Adverse Effect.

 

5.7                                 Formation Documents
and Entity Agreements. 

 

(a)                                  On
the Funding Date, the Agent shall have received a certificate of the general
partner or managing member or manager, as applicable, of the Borrower and each
other Loan Party which is a partnership or limited liability company, annexing
and certifying as to (a) the Formation Documents of such entity having been
duly executed, delivered and filed and remaining in full force and effect and
unmodified as of the date of such certificate (and annexing a copy thereof),
(b) due authorization, execution and delivery by such entity of the Loan
Documents to which it is a party, and (c) such entity being in good standing
and authorized to do business in each jurisdiction where the ownership of its
assets and operation of its business requires such qualification, as each of
the foregoing is set forth in Loan Agenda;

 

(b)                                 On
the Funding Date, the Agent shall have received a certificate of the managing
member or manager of each Loan Party which is a limited liability company
annexing and certifying as to (a) resolutions of such entity authorizing and
approving the transactions contemplated by the Loan Documents, and the

 

17

 

execution and delivery
thereof by such entity in respect of the documents to which it is a party and
on behalf of the other entities in which such limited liability company is a
general partner or managing member in respect of any of the Loan Documents, (b)
signatures and incumbency of all officers of such limited liability company
executing documentation on behalf of such entity or on behalf of any entity as
to which such limited liability company is a general partner or managing
member, as the case may be, in connection with the transactions contemplated by
the Loan Documents, (c) the Formation Documents of such entity having been duly
executed, delivered and filed and remaining in full force and effect and
unmodified as of the date of such certificate (and annexing copies thereof) and
(d) such entity being in good standing and authorized to do business in each
jurisdiction where the conduct of its business and ownership of its assets
requires such qualification, as each of the foregoing is set forth in the Loan
Agenda.

 

(c)                                  On
the Funding Date, the Agent shall have received a certificate of the secretary
of each Loan Party which is a corporation annexing and certifying as to (a)
corporate resolutions of such entity authorizing and approving the transactions
contemplated by the Loan Documents, and the execution and delivery thereof by
such entity in respect of the documents to which it is a party and on behalf of
the other entities in which such corporation is a general partner or managing
member in respect of any of the Loan Documents, (b) signatures and incumbency
of all officers of such corporation executing documentation on behalf of such
entity or on behalf of any entity as to which such corporation is a general
partner or managing member, as the case may be, in connection with the
transactions contemplated by the Loan Documents, (c) the Formation Documents of
such entity having been duly executed, delivered and filed and remaining in
full force and effect and unmodified as of the date of such certificate (and
annexing copies thereof) and (d) such entity being in good standing and
authorized to do business in each jurisdiction where the conduct of its
business and ownership of its assets requires such qualification, including, as
each of the foregoing is set forth in the Loan Agenda.

 

5.8                                 Compliance With Law.  There are no Legal Requirements which
prohibit or adversely limit the capacity or authority of the Borrower to enter
into the Loan or any Loan Party to execute the Loan Documents to which it is a
party, and perform the obligations of such Person with respect thereto.

 

5.9                                 Compliance With
Financial Covenants.  Agent shall
have received an Officer’s Certificate reflecting compliance with the Financial
Covenants and the terms and conditions hereof.

 

5.10                           Due Diligence.  Agent shall have received and completed a
review of such due diligence as the Agent may require with respect to any
Individual Property, including, without limitation:

 

(a)                                  Updated
title reports and copies of specimen owner’s title insurance policies (which
policies shall include, without limitation, a mezzanine endorsement) with
respect to the Individual Properties owned (fee simple or land

 

18

 

estate) or ground leased
by any Property Owner, reflecting the owner thereof, the interest of the Property
Owner therein, and any Mortgage Debt (the “Title Reports”);

 

(b)                                 For
the Churchill Property, a lender’s title insurance policy in favor of Agent
insuring the mortgage granted by the Churchill Owner to the Agent, containing
such coverages and endorsements as the Agent may reasonably require;

 

(c)                                  For
the Orlando Property, a commitment for the issuance of a lender’s title
insurance policy in favor of Agent insuring the mortgage granted by the Orlando
Owner to the Agent, containing such coverages and endorsements as the Agent may
reasonably require;

 

(d)                                 Copies
of all notes and mortgages evidencing all Mortgage Debt on any Individual
Property;

 

(e)                                  As
requested by the Agent, copies of all Ownership Interest Agreements;

 

(f)                                    Borrower’s
certification as to the principal balance and the regularly scheduled principal
and interest payments due on all First Mortgage Debt as of November 15,
2004;

 

(g)                                 For
each Individual Property, third party market rent updates;

 

(h)                                 Tenant
estoppel certificates from each tenant under a Lease;

 

(i)                                     Estoppel
Certificates from each ground lessor and/or remainderman (as available) as
applicable to each Individual Property;

 

(j)                                     Zoning
reports and surveys for each Individual Property; and

 

(k)                                  Copies
of all Leases for any Individual Property.

 

5.11                           Condition of Property.  There shall have been no uninsured,
unrepaired, or unrestored damage or destruction by fire or otherwise to any of
the real or tangible personal property comprising or intended to comprise the
Individual Properties which could reasonably be expected to have a Material
Adverse Effect.

 

5.12                           Insurance.  The Borrower shall have provided to Agent and
each of the Lenders evidence of the following insurance, each meeting the
requirements of the Agent: (i) reasonably satisfactory blanket liability
insurance in favor of the Borrower and each of the Borrower Subsidiaries, with
the Agent and the Lenders named as additional insureds and, with respect to the
Churchill Property, physical all-risk insurance acceptable to the Agent with
the Agent named as mortgagee and loss payee; (ii) a reasonably satisfactory
report from the third party monitoring the insurance as to the hazard and other
insurance on the Individual Properties maintained by the respective tenant
thereof, evidencing compliance with Exhibit E and, as applicable, the
respective Lease of each Individual Property, and (iii) a reasonably
satisfactory third party

 

19

 

contract regarding the monitoring of the insurance to be obtained by
tenants under Leases with respect to the Individual Properties.

 

5.13                           Third Party Consents and
Agreements.  The Agent shall have
received the Consents and such other third party consents and agreements as the
Agent may require with respect to the Loan.

 

5.14                           Intentionally Omitted.

 

5.15                           Cash Management.  The Borrower, each Borrower Subsidiary, and FT-FIN
GP shall open a Depository Account, as provided for herein, and the Borrower, FT-FIN
GP, and each Property Owner shall enter into a Cash Management Agreement with
the Agent.

 

5.16                           Interest Rate Protection
Agreement.  The Borrower shall have
entered into an Interest Rate Protection Agreement, from an issuer and in form
and substance reasonably acceptable to the Agent, with respect to the Loan,
which Interest Rate Protection Agreement shall be collaterally assigned to the
Agent, on behalf of the Lenders, to secure the Obligations.

 

5.17                           Legal Opinions.  Agent shall have received and approved legal
opinion letters from counsel representing the Borrower and the other Loan
Parties which meet Agent’s legal opinion requirements and covering such matters
incident to the transactions contemplated herein, as the Agent may reasonably
request.

 

5.18                           No Default.  There shall not be any Default under any of
the Loan Documents.

 

5.19                           Acquisition.  Agent shall have received and completed a
review of such due diligence and documentation as the Agent may require with
respect to the Acquisition.  All
conditions precedent to completion of the Acquisition shall have been
satisfied, as determined by the Agent, and all documentation necessary to
complete the Acquisition shall have been approved by the Agent and have been
executed, or will be executed simultaneous with the funding of the Loan.

 

5.20                           Subsequent Advance.  Upon the written request of the Borrower, at
the sole option of the Borrower, provided to the Agent not later than December 31,
2004, the Lenders agree to make the Subsequent Advance to the Borrower subject
to the following terms and conditions:

 

5.20.1                  No Default or
Event of Default shall have occurred and be continuing as of the date such
notice is given and as of date of the proposed Subsequent Advance;

 

5.20.2                  The Borrower
remains in compliance with the various conditions set forth in Section 5.1
through 5.19 above; and

 

5.20.3                  The Borrower is
in compliance with the Financial Covenants and shall remain in pro forma
compliance with the Financial Covenants after giving effect to the Subsequent
Advance.

 

20

 

ARTICLE 6

 

WARRANTIES
AND REPRESENTATIONS.  

 

The Borrower warrants and represents to Agent
and each of the Lenders for the express purpose of inducing Lenders to enter
into this Agreement, to make the Loan Advance, and to otherwise complete all of
the transactions contemplated hereby that upon the date of the Loan Advance and
at all times thereafter until the Loan has been repaid and all Obligations have
been satisfied as follows:

 

6.1                                 Formation.  Each of the Borrower and the other Loan
Parties has been duly formed and is validly existing and in good standing as a
corporation, partnership or limited liability company, as the case may be,
under the laws of the State of its formation. 
Each of the Borrower and the other Loan Parties has the requisite
corporate, partnership or company power and authority, as applicable, to own
its assets and conduct its businesses as currently conducted and owned, and to
enter into and perform its obligations under each Loan Document and/or Related
Document to which it is a party.  Each of
the Borrower and the other Loan Parties is in good standing and authorized to
do business in each jurisdiction where the ownership of its assets and/or the
conduct of its business requires such qualification except where the failure to
be so qualified would not have a Material Adverse Effect.

 

6.2                                 Proceedings;
Enforceability.  Each of the Borrower
and the other Loan Parties has taken all requisite corporate, partnership or
company action, as applicable, to authorize the execution, delivery and
performance by such Person of the Loan Documents and/or the Related Documents
to which it is a party.  Each Loan
Document and the Related Document to which it is a party which is required to
be executed and delivered on or prior to the date on which this representation
and warranty is being made has been duly authorized, executed and delivered and
constitutes the legal, valid and binding obligation of each of the Borrower and
the other Loan Parties which is a party thereto, enforceable against each such
Person in accordance with its respective terms except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency and
similar laws affecting rights of creditors generally and to general principles
of equity (regardless of whether enforcement is sought in a proceeding in
equity or at law).

 

6.3                                 Conflicts.  Neither the execution, delivery and
performance of the Loan Documents and the Related Documents by each of the Borrower
and the other Loan Parties or compliance by any such Person with the terms and
provisions thereof (including, without limitation, the granting of Liens
pursuant to the Security Documents), (i) will contravene any provision of any
law, statute, rule or regulation or any order, writ, injunction or decree of
any court or governmental instrumentality, (ii) will conflict with or result in
any breach of any of the terms, covenants or conditions of, or constitute a
default under, or result in the creation or imposition (or the obligation to
create or impose) of any Lien (except pursuant to the Security Documents) upon
any of the property or assets of any such Person pursuant to the terms of any
indenture, mortgage, deed of trust, credit agreement or loan agreement or any
other agreement, contract or instrument to which any such Person is a party or
by which it or any of its properties or assets is bound or to which it may be
subject or (iii) will violate any provision of any Formation Document of any
such Person.

 

6.4                                 Ownership and
Taxpayer Identification Numbers.

 

(a)                                  All
of the partners, owners, stockholders, and members, respectively and as may be
applicable, of each of the Borrower and the other Loan Parties are listed in Exhibit
F.  The exact correct name and
organizational

 

21

 

number(s) and federal
employer identification number(s) of the Borrower and the other Loan Parties
are accurately stated in Exhibits F, L and M.

 

(b)                                 The
Borrower is the owner of all of the ownership interests set forth in Section 3.1.3,
above, pledged by it to the Agent, on behalf of the Lenders.  Except for such ownership interests, the
Borrower does not directly hold any stock, membership, partnership or ownership
interest in any other Person.

 

(c)                                  The
Borrower and FT-FIN GP are each the owner, respectively, of all of the
ownership interests to be pledged to the Agent, on behalf of the Lenders,
pursuant to the Loan Documents.  Except
for such ownership interests and except as shown on Schedule 6.4, the
Borrower and the other Loan Parties do not directly hold any stock, membership,
partnership or ownership interest in any other Person.

 

(d)                                 Except
as shown on Schedule 6.4, no Loan Party or third party, directly or
indirectly, owns or controls any interest in any asset relating to the Borrower
or the business operations of the Borrower and/or the Borrower Subsidiaries.

 

6.5                                 Litigation.  Except as set forth in Schedule 6.5,
there are no actions, suits or proceedings at law or in equity or by or before
any governmental instrumentality or other agency or regulatory authority by any
entity (private or governmental) pending or, to the best of the Borrower’s
Knowledge, threatened with respect to the Loan, or the transactions
contemplated in the Loan Documents or the Related Documents, or any
documentation executed in connection therewith, or against the Borrower and/or
any of the other Loan Parties which could reasonably be expected to have a
Material Adverse Effect.

 

6.6                                 Information.  All factual information furnished by or on
behalf of the Borrower and the other Loan Parties to the Agent and/or any of
the Lenders (including, without limitation, all information contained in the Loan
Documents) for purposes of or in connection with this Agreement, the other Loan
Documents or any transaction contemplated herein or therein is, and all other
such factual information hereafter furnished by or on behalf of the Borrower
and the other Loan Parties to the Agent and/or any of the Lenders will be, true
and accurate in all material respects on the date as of which such information
is dated or certified and to the best of the Borrower’s Knowledge, not
incomplete by omitting to state any fact necessary to make such information not
misleading in any material respect at such time in light of the circumstances
under which such information was provided.

 

6.7                                 Taxes.  Each of the Borrower and the other Loan
Parties has made all required tax filings and have paid all federal, state and
local taxes applicable to them and/or their respective assets, except if
contested in accordance with Section 9.1.

 

6.8                                 Financial
Information.  The financial
statements of the Borrower and the other Loan Parties provided to the Agent
present fairly the financial conditions of each at the dates of such statements
of financial condition and the results of operations for the periods covered
thereby. The financial projections of the Borrower and the other Loan Parties
present a good faith estimate of the projected financial condition of each at the
reflected dates and the projected results of operations for the periods covered
thereby. Since the dates of the relevant financial

 

22

 

statements, no change has occurred which could have or reasonably be
expected to have a Material Adverse Effect.

 

6.9                                 Management
Agreements.  There are no other
management agreements or asset management agreements respecting the management
of the assets of the Borrower and/or any of the other Loan Parties.

 

6.10                           Control Provisions. 

 

(a)                                  The
Borrower controls, directly or indirectly, and without the requirement for
consent of any other Person, the management of each Borrower Subsidiary.

 

(b)                                 There
are no provisions in any limited partnership agreement, operating agreement, certificate
of incorporation, bylaws or any other agreement or instrument to which the
Borrower or any Borrower Subsidiary is party, under which any Person (other
than the Borrower or a Borrower Subsidiary) has the right to exercise the
management or control rights, powers or authority currently belonging to the
Borrower or any Borrower Subsidiary, except as set forth in (i) any mortgage,
deed of trust or similar security agreement encumbering any Individual Property
upon exercise of the rights and remedies upon default set forth in any of the
foregoing, or (ii) the rights of FT-FIN GP as general partner of the Borrower
Partnerships.

 

6.11                           Formation Documents.  The Borrower has delivered or caused to be
delivered to the Agent true and complete copies of all Formation Documents of
the Borrower and the other Loan Parties, and all amendments thereto as of the
date hereof and as of the date of the Loan Advance.

 

6.12                           Related Documents.  To the extent not provided for otherwise in
this Article 6, true and correct copies of all other Related Documents,
together with all amendments and modifications thereto, have been delivered to
the Agent, each of which is in full force and effect and, to the best of the
Borrower’s Knowledge, no material default has occurred thereunder which could
have a Material Adverse Effect.

 

6.13                           Bankruptcy Filings.  None of the Borrower or any of the other Loan
Parties is contemplating either a filing of a petition under any state or
federal bankruptcy or insolvency laws or the liquidation of all or a major
portion of its assets or property, and the Borrower has no Knowledge of any
Person contemplating the filing of any such petition against any of the Borrower
and/or any of the other Loan Parties.

 

6.14                           Options.  No Person holds a right of first refusal or
option to purchase with respect to any item of Collateral other than as set
forth in the Leases.

 

6.15                           Investment Company.  None of the Borrower and/or any of the other Loan
Parties is an “investment company” or a company “controlled” by an “investment
company,” within the meaning of the Investment Company Act of 1940, as amended.

 

23

 

6.16                           Holding Company.  None of the Borrower and/or any of the other Loan
Parties is a “holding company,” or a “subsidiary company” of a “holding
company,” or an “affiliate” of a “holding company” or of a “subsidiary company”
of a “holding company,” within the meaning of the Public Utility Holding
Company Act of 1935, as amended.

 

6.17                           Individual Properties.

 

6.17.1                  Each of the Property
Owners possesses such Licenses and Permits issued by the appropriate federal,
state, or local regulatory agencies or bodies necessary to own and operate each
Individual Property, except where the failure to possess any such License or Permit
would not have a Material Adverse Effect. The Property Owners are in material
compliance with the terms and conditions of all such Licenses and Permits,
except where the failure so to comply would not, singly or in the aggregate,
result in a Material Adverse Effect.  All
of the Licenses and Permits are valid and in full force and effect, except
where the invalidity of such Licenses and Permits or the failure of such
Licenses and Permits to be in full force and effect would not result in a
Material Adverse Effect.  Neither the
Borrower nor any of the Property Owners has received any notice of proceedings
relating to the revocation or modification of any such Licenses and Permits
which, singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in a Material Adverse Effect.

 

6.17.2                  Except to the
extent the failure of the following to be true would not result in a Material
Adverse Effect, (i) the Property Owners have either (x) fee simple title to the
Individual Properties, (y) a land estate interest for a specified number of
years in the Individual Properties, or (z) a leasehold estate interest in the
Individual Properties, as set forth in Schedule 6.17; (ii) the
interests of the Property Owners in the Individual Properties are not subject
to any Liens securing the repayment of money except for those securing the
repayment of the First Mortgage Debt, as set forth in Schedule 6.17.8,
and (iii) each land estate remainderman interest and lessor interest under a
Ground Lease is not, directly or indirectly, owned or controlled by a Loan
Party, Borrower Subsidiary or other Loan Party;

 

6.17.3                  Except to the
extent the failure of the following to be true would not result in a Material
Adverse Effect, (i) to the best of Borrower’s Knowledge and except as otherwise
disclosed in those reports identified on Schedule 6.17.3, each Individual
Property is free of any Hazardous Materials in violation of any Environmental
Laws applicable to such property; (ii) none of the Property Owners or Borrower
has received any notice of a claim under or pursuant to any Environmental Laws
applicable to an Individual Property or under common law pertaining to
Hazardous Materials on or originating from any Individual Property; and
(iii) none of the Property Owners or Borrower has received any notice from
any Governmental Authority claiming any material violation of any Environmental
Laws that is uncured or unremediated as of the date hereof;

 

6.17.4                  The mortgages
and deeds of trust encumbering the Individual Properties of any Property Owners
are not cross-defaulted or cross-collateralized to any Individual Property
owned by any other Property Owners;

 

24

 

6.17.5                  Except to the
extent the failure of the following to be true would not result in a Material
Adverse Effect, (i) with respect to the Individual Properties, each Lease is in
full force and effect, (ii) except as set forth in Schedule 6.17.5,
to the best of Borrower’s Knowledge, none of the Property Owners is in default
in the performance of any material obligation under any Lease and Borrower has
no Knowledge of any circumstances which, with the passage of time or the giving
of notice, or both, would constitute an event of default by any party under any
of the Leases, (iii) except as set forth in Schedule 6.17.5, to the
best of Borrower’s Knowledge, no tenant is in monetary default beyond thirty (30)
days or material non-monetary default under its Lease, (iv) except as otherwise
expressly set forth in Schedule 6.17.5, to the best of Borrower’s
Knowledge, there are no actions, voluntary or involuntary, pending against any
tenant under a Lease under any bankruptcy or insolvency laws, (v) none of the
Leases and none of the rents or other amounts payable thereunder has been
assigned, pledged or encumbered by any of the Property Owners or any other
Person, except in connection with financing secured by the applicable
Individual Property, and (vi) the basic terms and conditions of each Lease are
set forth in Schedule 6.17.5 and Schedule 6.17.6 (the
foregoing schedule, as updated from time to time as provided herein, being
referred to herein as the “Lease Schedule”).

 

6.17.6                  Except to the
extent the failure of the following to be true would not result in a Material
Adverse Effect, (i) each Ground Lease is valid, binding and in full force and
effect as against the applicable Property Owners and, to the best of Borrower’s
Knowledge, the other party thereto, (ii) except for tenants under the Leases
and except in connection with security relating to the Mortgage Debt, none of
the Ground Leases is subject to any pledge, lien, assignment, license or other
agreement granting to any third party any interest therein or any right to the
use or occupancy of any premises leased thereunder, (iii) no payments under any
Ground Lease are delinquent and no notice of default thereunder has been sent
or received by any Loan Party which has not been cured or waived prior to the
date hereof, and to the best of Borrower’s Knowledge, there does not exist
under any of the Ground Leases any default by any Property Owners or any event
which merely with notice or lapse of time or both, would constitute such a
default by any of the Property Owners, and (iv) the basic terms and conditions
of each Ground Lease are set forth in Schedule 6.17.6 and Schedule 2.8.4,
including, without limitation, all such Ground Lease Extension Options (x)
which have been exercised as of the Closing Date and (y) as to which the final
date to exercise such Ground Lease Extension Option is within the next twelve
(12) months (including all applicable dates by which notices must be provided
in connection with the exercise of same) (the foregoing schedule, as updated
from time to time as provided herein, being referred to as the “Ground Lease
Extension Option Schedule”).

 

6.17.7                  Except to the
extent the failure of the following to be true would not result in a Material
Adverse Effect, (i) each Ownership Interest Agreement relating to a Remainder
Ground Lease Option is valid, binding and in full force and effect as against
the applicable Property Owners and, to the best of Borrower’s Knowledge, the
other party thereto, (ii) except for tenants under the Leases and except in
connection with security relating to the Mortgage Debt, none of the Remainder
Ground Lease Options is subject to any pledge, lien, assignment, license or
other agreement granting to any third party any interest therein or any right
to the use or occupancy of any premises leased thereunder, (iii) no payments
under any Ownership Interest Agreement relating to a

 

25

 

 

Remainder Ground Lease
Option are delinquent and no notice of default thereunder has been sent or
received by any Borrower, any other Loan Party or other Loan Party which has
not been cured or waived prior to the date hereof, and to the best of Borrower’s
Knowledge, there does not exist under any of the Ownership Interest Agreements
relating to the Remainder Ground Lease Options any default by any Property
Owners or any event which merely with notice or lapse of time or both, would
constitute such a default by any of the Property Owners, and (iv)  the basic terms and conditions of each
Remainder Ground Lease Option are set forth in Schedule 6.17.6 and Schedule 2.8.4,
including, without limitation, all such Remainder Ground Lease Options as to
which the final date to exercise such Remainder Ground Lease Option is within
the next twelve (12) months (including all applicable dates by which notices
must be provided in connection with the exercise of same) (the foregoing
schedule, as updated from time to time as provided herein, being referred to as
the “Remainder Ground Lease Option Schedule”).

 

6.17.8                  Schedule 6.17.8
accurately details in all material respects the approximate amount, term, and
interest rate applicable to all Mortgage Debt encumbering the Individual
Properties (the foregoing schedule, as updated from time to time as provided
herein, the “Mortgage Debt Schedule”). Except as noted on Schedule 6.17.8,
no notice of default thereunder has been sent or received by any Loan Party
which has not been cured or waived prior to the date hereof, and to the best of
the Borrower’s Knowledge, there does not exist with respect to any Mortgage
Debt any default by any Property Owners or any event which merely with notice
or lapse of time or both, would constitute such a default by any of the
Property Owners.  None of the Borrower,
any Loan Party, any Borrower Subsidiary, or any other Loan Party owns, directly
or indirectly, any material interest in any Mortgage Debt.

 

6.17.9                  Each of the
Property Owners is treated as a partnership for federal income tax purposes and
does not constitute a publicly traded partnership within the meaning of Section 7704
of the Code.

 

6.17.10            Each of the Property
Owners possesses valid owner’s policy title insurance from title insurers of recognized
financial responsibility on each of the Individual Properties in amounts not
less than the original purchase price of such properties, and such title
insurance is in full force and effect.

 

6.17.11            Except as set forth in
Schedule 6.17.11, as to any of the Individual Properties, there is
not pending the exercise of any Economic Discontinuance Rights by any tenants.

 

6.18                           Use of Proceeds.  The proceeds of the Loan shall be used solely
and exclusively as provided in Section 1.3.  No portion of the proceeds of the Loan shall
be used by the Borrower directly or indirectly, and whether immediately,
incidentally or ultimately (i) to purchase or carry any margin stock or to
extend credit to others for the purpose thereof or to repay or refund
indebtedness previously incurred for such purpose, or (ii) for any purpose
which would violate or be inconsistent with the provisions of regulations of
the Board of Governors of the Federal Reserve System including, without
limitation, Regulations G, T, U and X thereof.

 

26

 

6.19                           Insurance. 

 

6.19.1                  (i) The
Individual Properties are insured by insurers of recognized financial
responsibility against such losses and risks in compliance with the
requirements of the Leases and as set forth in Exhibit E, hereto, such
insurance maintained by the tenants under the Leases; (ii) the Borrower has a
monitoring system in place to periodically verify whether the tenants under the
Leases have in place insurance as required by the applicable Lease; and (iii)
the Borrower has satisfactory liability insurance in favor of the Borrower and
each of the Borrower Subsidiaries in compliance with the requirements of the
Agent in effect on the date hereof.

 

6.20                           Deferred Compensation and
ERISA.  None of the Borrower and/or
any of the other Loan Parties has any pension, profit sharing, stock option,
insurance or other arrangement or Plan for employees covered by ERISA except as
may be designated to Agent in writing by the Borrower from time to time and no
Reportable Event has occurred and is now continuing with respect to any such
ERISA Plan.  The granting of the Loan,
the performance by the Borrower and/or of any of the other Loan Parties of
their respective obligations under the Loan Documents and/or such Persons’
conducting of their respective operations do not and will not violate any
provisions of ERISA.

 

6.21                           No Default.  There is no Default on the part of the
Borrower or any of the other Loan Parties under this Agreement or any of the
other Loan Documents and no event has occurred and is continuing which would
constitute a Default under any Loan Document.

 

6.22                           Other Loan Parties’
Warranties and Representations.  The
Borrower has no reason to believe that any warranties or representations made in
writing by any of the other Loan Parties to the Agent or any of the Lenders are
untrue, incomplete or misleading in any material respect.

 

ARTICLE 7

 

AFFIRMATIVE
COVENANTS.  

 

The Borrower covenants and agrees that from
the date hereof and so long as any indebtedness is outstanding hereunder, or
any of the Loan or other Obligations remains outstanding, as follows:

 

7.1                                 Notices.  The Borrower shall, with reasonable
promptness, but in all events within five (5) days after it has actual
Knowledge thereof, notify Agent and each of the Lenders in writing of the
occurrence of any act, event or condition which constitutes a Default or Event
of Default under any of the Loan Documents. 
Such notification shall include a written statement of any remedial or
curative actions which the Borrower proposes to undertake and/or to cause any
of the other Loan Parties to undertake to cure or remedy such Default or Event
of Default.

 

7.2                                 Financial
Statements; Reports; Officer’s Certificates.  The Borrower shall furnish or cause to be
furnished to Agent as set forth herein from time to time, the following
financial statements, reports, certificates, and other information, all in
form, manner of presentation and substance acceptable to Agent and each of the
Lenders:

 

27

 

7.2.1                        Annual
Statements.

 

(a)                                  Within
one hundred twenty (120) days after the close of each fiscal year of the
Borrower, the consolidated statements of financial condition of the Borrower
and all non-consolidated Borrower Subsidiaries as at the end of such fiscal
year and the related consolidated statements of income and retained earnings
and statements of changes in financial position for such fiscal year, in each
case, commencing with the Fiscal Year ending December 31, 2005, setting
forth comparative for the preceding fiscal year, internally prepared in
accordance with GAAP, all in form and manner of presentation acceptable to
Agent, such financial statements to include and to be supplemented by such
detail and supporting data and schedules as Agent may from time to time
reasonably determine, together with an Officer’s Certificate from the Borrower
certifying that such financial statements are true, accurate, and complete in
all material respects and that no Default or Event of Default has occurred and
is continuing.

 

(b)                                 Periodic
Statements.  Within forty-five (45)
days after the close of each calendar quarter (including the quarter ending on December 31)
commencing March 31, 2005, the following: (i) the consolidated statements
of financial condition of the Borrower and all non-consolidated Borrower
Subsidiaries, internally prepared in accordance with GAAP, consistently
applied, as at the end of such quarterly period and the related consolidated
statements of income and retained earnings and statements of changes in
financial position for such quarterly period and for the elapsed portion of the
Fiscal Year ended with the last day of such quarterly period, in each case
commencing with the Fiscal Year ending December 31, 2004, setting forth
comparative figures for the related periods in the prior fiscal year, subject
to normal year-end audit adjustments, all in form and manner of presentation
acceptable to Agent, such financial statements to include and to be supplemented
by such detail and supporting data and schedules as Agent may from time to time
reasonably determine, (ii) an Officer’s Certificate from the Borrower
certifying that such financial statements are true, accurate, and complete in
all material respects and that no Default or Event of Default has occurred and
is continuing, and (iii) an updated Cash Flow Projection specifically
identifying, without limitation, (a) any changes to the Cash Flow Projections
provided in then prior Officer’s Certificate and (b) any Distributions by
Borrower Subsidiaries projected during the next one-hundred and eighty (180)
days.

 

(c)                                  Compliance
Certificates.  Within forty-five (45)
days after the close of each quarterly Accounting period in each Fiscal Year of
the Borrower commencing March 31, 2005, Compliance Certificates in the
form of Exhibit G, annexed hereto, together with an Officer’s
Certificate from the Borrower providing and otherwise certifying with respect
to the following:

 

(i)                                     the
compliance with the Financial Covenants and the scheduled principal payments
provided for in Section 2.5.1, with such supporting detail as is deemed
necessary by the Agent to verify the calculations incorporated therein;

 

(ii)                                  any
changes to the Lease Schedule, including, without limitation, specific
identification of (a) any Leases which will expire

 

28

 

within one (1) calendar
year from the date of the respective Officer’s Certificate and the applicable
dates and conditions by and upon which such term may be extended, (b) any
material defaults then existing under any Lease of which the Borrower has
Knowledge not included in a prior Officer’s Certificate or Lease Schedule, (c)
any Leases as to which the term thereof has expired since the date of the then
prior Officer’s Certificate, without the extension thereof, of which the
Borrower has Knowledge, (d) any Leases as to which the tenant has vacated the
subject premises since the date of the then prior Officer’s Certificate, of
which the Borrower has Knowledge, (e) any Leases or commitments to lease
entered into since the date of the then prior Officer’s Certificate, and (f) an
updated summary of any pending exercise by any tenant under a Lease of Economic
Discontinuance Rights from the date of the then prior Officer’s Certificate,
including, without limitation, (i) the identity of the subject Individual
Property, (ii) the date by which the relevant Property Owner must reject the
Rejectable Offer, and (iii) the current calculation of the applicable Rejection
Test with such supporting detail as is deemed necessary by the Agent to verify
the calculations incorporated therein;

 

(iii)                               any
changes to the Ground Lease Extension Option Schedule, including, without
limitation, (a) specific identification of all Ground Lease Extension Options
(i) which have been exercised since the date of the then prior Officer’s
Certificate, and (ii) as to which the final date for exercising such Ground
Lease Extension Option is within the twelve (12) months following the date of
the Officer’s Certificate (including all applicable dates by which notices must
be provided in connection with the exercise of same), and (b) any defaults then
existing under any Ground Lease not included in a prior Officer’s Certificate
or Ground Lease Extension Option Schedule;

 

(iv)                              any
changes to the Remainder Ground Lease Options Schedule, including, without
limitation, (a) specific identification of all Remainder Ground Lease Options
(i) which have been exercised since the date of then prior Officer’s
Certificate and (ii) as to which the final date for exercising such remainder
Ground Lease Option is within the twelve (12) months following the date of the
Officer’s Certificate (including all applicable dates by which notices must be
provided in connection with the exercise of same), (b) any defaults then
existing under any Ownership Interest Agreement relating to a Remainder Ground
Lease Option not included in a prior Officer’s Certificate or Remainder Ground
Lease Option Schedule, and (c) a listing of any remainderman interests or
ground lessor interests in Ground Leases (i) acquired by the Borrower, any of
the Borrower Subsidiaries and/or any of the other Loan Parties since the date
of the then prior Officer’s Certificate, together with specific detail as to
the nature of the interest acquired and the Person to whom the interest was
transferred, and (ii) as to which an agreement has been entered into since the
date of the then prior Officer’s Certificate for the acquisition thereof

 

29

 

by the Borrower, the
Borrower Subsidiaries, and/or any of the other Loan Parties, together with the
primary terms of such agreement;

 

(v)                                 any
changes to the Mortgage Debt Schedule, including, without limitation, (a) any prepayments
made on any Mortgage Debt since the date of the then prior Officer’s
Certificate, (b)  specific identification
of all Mortgage Debt which matures within the twelve (12) months following the
date of the Officer’s Certificate, (c) any refinancing of such Mortgage Debt
which has occurred (or for which an application has been made or a loan
commitment received) since the date of the then prior Officer’s Certificate,
together with a summary of the use and disbursement of the proceeds thereof,
and (d) any defaults then existing under any Mortgage Debt not included in a
prior Officer’s Certificate or Mortgage Debt Schedule, with such supporting
detail as is deemed necessary by the Agent to verify the calculations
incorporated therein;

 

(vi)                              A
listing of any Individual Properties (a) sold by the applicable Property Owner
since the date of then prior Officer’s Certificate, together with specific
detail as to the use and disbursement of the proceeds of the sale, and (b) as
to which an agreement has been entered into since the date of the then prior
Officer’s Certificate for the sale thereof, together with the primary terms of
such agreement;

 

(vii)                           a
listing of any material assets acquired, or as to which an agreement to acquire
has been entered into, by the Borrower, the Borrower Subsidiaries, and/or any
of the other Loan Parties since the date of then prior Officer’s Certificate,
together with the primary terms of such acquisition or agreement;

 

(viii)                        except as
disclosed in such Officer’s Certificate, to the extent of the knowledge of such
officer, a certification that all insurance premiums in respect of insurance
policies covering the properties owned (directly or indirectly) by the Property
Owners have been paid or are not past due more than sixty (60) days, all debt
service payments in respect of any Mortgage Debt of any Property Owner have
been made and all real estate taxes and other impositions relating to any
Property Owner or its related assets have been paid; and

 

(ix)                                a
summary of the status of any pending insurance claims or condemnation award
proceedings.

 

(d)                                 Data
Requested.  Within a reasonable
period of time and from time to time such other financial data or information
as Agent may reasonably request with respect to the Individual Properties, the
Borrower, the Borrower Subsidiaries, and/or any of the other Loan Parties,
including, but not limited to, rent rolls, aged receivables, aged payables,
leases, budgets, forecasts, reserves, cash flow projections, deposit accounts,
mortgage information, physical condition of the Individual Properties and
pending lease proposals.

 

30

 

(e)                                  Tax
Returns.  To the extent prepared and
filed, upon Agent’s request, copies of all federal and state tax returns of the
Borrower and any of the other Loan Parties.

 

(f)                                    Lease
Notices.  Concurrently with the
giving thereof, and within ten (10) Business Days of receipt thereof, copies of
all notices, other than routine correspondence, given or received by the
Borrower, FT-FIN GP, or any Property Owner with respect to any Lease.

 

(g)                                 Mortgage
Notices.  Concurrently with the
giving thereof, and within ten (10) Business Days of receipt thereof, copies of
all notices, other than routine correspondence, given or received by the Borrower,
FT-FIN GP, or any Property Owner with respect to any Mortgage Debt.

 

(h)                                 Ground
Lessor/Remainder Interest Notices. 
Concurrently with the giving thereof, and within ten (10) Business Days
of receipt thereof, copies of all notices, other than routine correspondence,
given or received by Borrower, FT-FIN GP or any Property Owner with respect to
any Ownership Interest Agreement, Ground Lease Extension Option, and/or
Remainder Ground Lease Option.

 

(i)                                     Entity
Notices. Concurrently with the issuance thereof, copies of all written
notices (excluding routine correspondence) given to the partners, owners,
stockholders, and/or members, respectively, of the Borrower and/or any of the
other Loan Parties.

 

(j)                                     Notice
of Distributions.  Concurrently with
the giving thereof, and within ten (10) Business Days of receipt thereof,
copies of all notices of Distributions to the extent given by any Borrower
Subsidiaries to the Borrower and/or FT-FIN GP. 
The Borrower shall provide the Agent with immediate written notice in
the event that the Borrower or any Borrower Subsidiaries determines (or
reasonably should be able to determine) that the Cash Flow Projections are no
longer accurate and could reasonably be expected to have a Material Adverse
Effect.

 

(k)                                  Property
Acquisition or Sale.  Within ten (10)
Business Days of receipt thereof, copies of all proposed contracts, agreements,
or offers in any way relating to a proposed sale or acquisition of any material
asset by the Borrower and/or any of the other Loan Parties, along with a pro
forma Compliance Certificate with respect to the Financial Covenants after
giving effect to the proposed transaction.

 

(l)                                     Notices
Regarding Payment Direction Letters. 
Within ten (10) Business Days of receipt thereof, copies of all notices
(excluding routine correspondence) received by the Borrower, FT-FIN GP or any
Borrower Subsidiary who has agreed to the direction of the payment of funds as
provided for in a Payment Direction Letter.

 

31

 

(m)                               Notice
of Termination of Payment Direction Letter. Promptly, and in any event
within ten (10) Business Days after an officer of the Borrower obtains
Knowledge thereof, written notice of the termination of any Payment Direction
Letter, together with evidence of the satisfactory reinstatement or replacement
thereof in accordance with the terms and conditions hereof.

 

(n)                                 Third
Party Default Notices.  Immediately
upon notice or receipt thereof by the Borrower and/or any of the other Loan
Parties, copies of all notices of default, other non-performance, and/or
exercise (or intended exercise) relating in any way to any one or more of the
Related Documents.

 

(o)                                 Notice
of Litigation. Promptly, and in any event within ten (10) Business Days
after the Borrower obtains Knowledge thereof, written notice of any pending or,
to the best of the Borrower’s Knowledge, threatened action, suit or proceeding
at law or in equity or by or before any governmental instrumentality or other
agency or regulatory authority by any entity (private or governmental) relating
in any way to the Loan, the transactions contemplated in the Loan Documents
(including, without limitation, with regard to all Distributions), the Related
Documents, or the transactions contemplated in connection with the Acquisition
or any documentation executed in connection therewith, or relating to the
Borrower and/or any of the other Loan Parties, which could reasonably be
expected to have a Material Adverse Effect.

 

(p)                                 Notice
of Hazardous Materials  Promptly, and
in any event within ten (10) Business Days after the Borrower obtains Knowledge
thereof, written notice of (i) any Release (as defined in the Environmental
Indemnity) or Threat of Release (as defined in the Environmental Indemnity) of
Hazardous Materials on, in, under or affecting all or any portion of any
Individual Property or (ii) the violation of any Environmental Law, in each
case which could reasonably be expected to have a Material Adverse Effect.

 

(q)                                 Net Cash Flow.  Within fifteen (15) days after the end of
each calendar quarter, a certification of the Net Cash Flow for the quarter
then ended.

 

7.3                                 Existence.  The Borrower shall do or cause to be done all
things necessary to (i) preserve, renew and keep in full force and effect (x)
the partnership, company or corporate existence, as applicable, of FT-FIN GP
and the Borrower Subsidiaries and (y) the material rights, licenses, permits
and franchises of FT-FIN GP and the Borrower Subsidiaries, (ii) comply with all
laws and other Legal Requirements applicable to it and its assets, business and
operations and those of FT-FIN GP and the Borrower Subsidiaries, and (iii) to
the extent applicable, at all times maintain, preserve and protect all material
franchises and trade names and all the remainder of its property used or useful
in the conduct of its business, and keep its assets in good working order and
repair, ordinary wear and tear excepted, and from time to time make, or cause
to be made, all reasonably necessary repairs, renewals, replacements, betterments
and improvements thereto.

 

7.4                                 Payment of Taxes.  The Borrower shall duly pay and discharge,
and cause FT-FIN GP and each Borrower Subsidiary to duly pay and discharge,
before the same shall become overdue, all taxes, assessments, impositions, and
other governmental charges payable by it or

 

32

 

with respect to the Individual Properties, to the extent that same are
not paid by the tenants under the respective Leases, except if contested in
accordance with Section 9.1.

 

7.5                                 Insurance;
Casualty, Taking.

 

7.5.1                        The
Borrower shall at all times maintain or cause the appropriate Person to
maintain in full force and effect the following insurance: (i) to the best of
the Borrower’s Knowledge, the Individual Properties shall be insured by
insurers of recognized financial responsibility against such losses and risks
in compliance with the Leases and the requirements set forth in Exhibit E
hereto, such insurance maintained by the tenants under the Leases; (ii) the
Borrower shall have a monitoring system in place to periodically verify whether
the tenants under the Leases have in place insurance as required by the
applicable Lease; and (iii) the Borrower shall have satisfactory liability
insurance in favor of the Borrower and each of the Borrower Subsidiaries in
compliance with the requirements in effect of the date hereof.

 

7.5.2                        In the
event of any damage or destruction to any Individual Property (or to the extent
now or hereafter applicable, any Collateral) by reason of fire or other hazard
or casualty, the Borrower shall give immediate written notice thereof to Agent.
If there is any condemnation for public use of any Individual Property (or to
the extent now or hereafter applicable, any Collateral), the Borrower shall
give immediate written notice thereof to Agent. Further, the Borrower shall
upon the request of the Agent provide to the Agent with a report as to the
status of any insurance adjustment, condemnation claim, or restoration
resulting from any casualty or taking.

 

7.6                                 Inspection.  The Borrower shall cause the Borrower
Subsidiaries to permit the Agent and the Lenders and its/their agents,
representatives and employees to inspect the Individual Properties and the
Collateral at reasonable hours upon reasonable notice, except to the extent
expressly prohibited or otherwise limited in the subject Leases.

 

7.7                                 Loan Documents.  The Borrower (i) shall observe, perform and
satisfy all the terms, provisions, covenants and conditions to be performed by
it under, and to pay when due all costs, fees and expenses, and other
Obligations of the Borrower to the extent required under, the Loan Documents
and (ii) shall cause the other Borrower Subsidiaries and other Loan Parties to
observe, perform and satisfy all the terms, provisions, covenants and
conditions to be performed by such Person under, and to pay when due all costs,
fees and expenses, and other Obligations to the extent required under, the Loan
Documents.

 

7.8                                 Further Assurances.  The Borrower shall and shall cause the
Borrower Subsidiaries and other Loan Parties to execute and deliver to the
Agent and the other Lenders such documents, instruments, certificates,
assignments and other writings, and do such other acts, necessary or desirable
in the reasonable judgment of the Agent, to evidence, preserve and/or protect
the Collateral at any time securing or intended to secure the Obligations and
do and execute all and such further lawful acts, conveyances and assurances as
the Agent may reasonably require for the better and more effective carrying out
of the intents and purposes of this Agreement and the other Loan Documents.

 

7.9                                 Books and Records.  The Borrower shall and shall cause FT-FIN GP
and the Borrower Subsidiaries and other Loan Parties to keep and maintain in
accordance with GAAP

 

33

 

(or such other Accounting basis reasonably acceptable to the Agent),
proper and accurate books, records and accounts reflecting all of the financial
affairs of the Borrower and such other Persons and all items of income and
expense in connection with their respective business and operations and in
connection with any services, equipment or furnishings provided in connection
with the operation of the business of the Borrower and such Persons, whether
such income or expense is realized thereby or by any other Person.  The Agent shall have the right, not more than
once each quarter (unless an Event of Default shall have occurred and be
continuing in which case as often as the Agent shall determine), during normal
business hours and upon reasonable notice, to examine such books, records and
accounts of the Borrower, FT-FIN GP, and the other Loan Parties at the office
of the Person maintaining such books, records, and accounts and to make such copies
or extracts thereof as the Agent shall desire. The Borrower shall maintain all
of its business records at the address specified at the beginning of this
Agreement, subject to change upon advance written notification to the Agent.  The Agent may discuss the financial and other
affairs of the Borrower and/or, FT-FIN GP, and the other Loan Parties with any
of their respective partners, owners, and any accountants (as to accountants,
prior to the occurrence of an Event of Default and following the cure of any
Event of Default, upon prior approval of the Borrower, not to be unreasonably
withheld, and at the cost and expense of the Agent and the Lenders) hired by
the Borrower, it being agreed that Agent and each of the Lenders shall use best
efforts to not divulge information obtained from such examination to others
except in connection with Legal Requirements and in connection with
administering the Loan, enforcing its rights and remedies under the Loan
Documents and in the conduct, operation and regulation of its banking and
lending business (which may include, without limitation, the transfer of the
Loan or of participation interests therein). 
Any assignee or transferee of the Loan, co-lender, or any holder of a
participation interest in the Loan shall be entitled to deal with such
information in the same manner and in connection with any subsequent transfer
of its interest in the Loan or of further participation interests therein.

 

7.10                           Business and Operations.  The Borrower shall (and shall cause FT-FIN GP
and the Borrower Subsidiaries to) (i) continue to engage in the type of
businesses presently conducted by them as of the Closing Date, respectively, as
and to the extent the same are necessary for the ownership of, and preservation
of the value and utility of, the Collateral and the Individual Properties, and
(ii) be qualified to do business and in good standing under the laws of each
jurisdiction, and otherwise to comply with all Legal Requirements, as and to
the extent the same are required for the ownership, maintenance, management and
operation of the assets of such Person except where the failure to be so
qualified could not reasonably be expected to have a Material Adverse Effect.

 

7.11                           Title.  The Borrower shall and shall cause the
Borrower Subsidiaries to warrant and defend (x) the title to each item of
Collateral owned by such Person and every part thereof, subject only to the
Liens (if any) permitted hereunder, (y) the validity and priority of the Liens
and security interests held by the Agent pursuant to the Loan Documents, in
each case against the claims of all Persons whomsoever, and (z) the title to
and in the Individual Properties, subject only to the Mortgage Debt and any
liens granted to the Agent.  The Borrower
shall be responsible to reimburse Agent and the Lenders for any losses, costs,
damages or expenses (including reasonable attorneys’ fees and court costs)
incurred by the Agent and/or any of the Lenders if an interest in any item of
Collateral, other than as permitted hereunder, is claimed by another Person.

 

34

 

7.12                           Estoppel.  The Borrower shall (and shall cause the
Borrower Subsidiaries to), within ten (10) days after a request therefor from
the Agent, which request shall not be made by Agent more than once each quarter
during each Fiscal Year, furnish to the Agent a statement, duly acknowledged
and certified, setting forth (i) the amount then owing by the Borrower in
respect of the Obligations, (ii) the date through which interest on the Loan
has been paid, (iii) any offsets, counterclaims, credits or defenses to the
payment by the Borrower or any Borrower Subsidiary to the Obligations and (iv)
whether any written notice of Default from Agent to the Borrower or any of the
Borrower Subsidiaries is then outstanding and acknowledging that this Agreement
and the other Loan Documents are in full force and effect and unmodified, or if
modified, giving the particulars of such modification.

 

7.13                           ERISA.  The Borrower shall (and shall cause each of
FT-FIN GP and the Borrower Subsidiaries to) as soon as possible and, in any
event, within ten (10) days after the Borrower, FT-FIN GP, any Borrower
Subsidiary or any ERISA Affiliate knows or has reason to know of the occurrence
of any of the following which could have or reasonably be expected to have a
Material Adverse Effect, deliver to Agent a certificate of the an executive
officer of the Borrower setting forth details as to such occurrence and the
action, if any, that the Borrower, FT-FIN GP, or applicable Borrower Subsidiary
or such ERISA Affiliate is required or proposes to take, together with any
notices required or proposed to be given to or filed with or by such the
Borrower, FT-FIN GP, Borrower Subsidiary, the ERISA Affiliate, the PBGC, a Plan
participant or the Plan administrator with respect thereto:  (i) that a Reportable Event has occurred;
(ii) that an accumulated funding deficiency has been incurred or an application
may be or has been made to the Secretary of the Treasury for a waiver or modification
of the minimum funding standard (including any required installment payments)
or an extension of any amortization period under Section 412 of the Code
with respect to a Plan; (iii) that a contribution required to be made to a Plan
has not been timely made; (iv) that a Plan has been or may be terminated,
reorganized, partitioned or declared insolvent under Title IV of ERISA; (v)
that a Plan has an Unfunded Current Liability giving rise to a lien under ERISA
or the Code; (vi) that proceedings may be or have been instituted to terminate
or appoint a trustee to administer a Plan; (vii) that a proceeding has been
instituted pursuant to Section 515 of ERISA to collect a delinquent
contribution to a Plan; (viii) that the Borrower, FT-FIN GP, Borrower Subsidiary,
or ERISA Affiliate will or may incur any liability (including any indirect,
contingent, or secondary liability) to or on account of the termination of or
withdrawal from a Plan under Section 4062, 4063, 4064, 4069, 4201, 4204 or
4212 of ERISA or with respect to a Plan under Section 401(a)(29), 4971,
4975 or 4980 of the Code or Section 409 or 502(i) or 502(l) of ERISA; (ix)
or that the Borrower, FT-FIN GP, or Borrower Subsidiary may incur any material
liability pursuant to any employee welfare benefit plan (as defined in Section 3(l)
of ERISA) that provides benefits to retired employees or other former employees
(other than as required by Section 601 of ERISA) or any employee pension
benefit plan (as defined in Section 3(2) of ERISA).  The Borrower shall (and shall cause FT-FIN GP
and the Borrower Subsidiaries to) deliver to Agent a complete copy of the
annual report (Form 5500) of each Plan required to be filed with the Internal
Revenue Service.  In addition to any
certificates or notices delivered to Agent pursuant to the first sentence
hereof, copies of any material notices received by the Borrower, FT-FIN GP, a
Borrower Subsidiary, or any ERISA Affiliate with respect to any Plan shall be
delivered to Agent no later than ten (10) days after the date such report has
been filed with the Internal Revenue Service or such notice has been received
by Borrower, FT-FIN GP, or Borrower Subsidiary or ERISA Affiliate, as
applicable.

 

35

 

7.14                           Depository Accounts.  The Borrower shall (and shall cause each of
the Borrower Subsidiaries and the other Loan Parties) to (i) maintain all
operating and other depository accounts, if any, with the Agent (or any
successor thereto) (singly and collectively, including the Depository Accounts,
the “Borrower Accounts”), the Borrower Accounts as of the date hereof listed on
Exhibit R, annexed hereto, unless otherwise agreed by Agent in writing, (ii)
maintain a minimum of one depository account for each such Person) with the
Agent (or any successor thereto) (singly and collectively, the “Depository
Accounts”), unless otherwise agreed by Agent in writing, and (iii) execute and
deliver such Cash Management Agreements as Agent shall deem customary and
appropriate to provide for terms and conditions satisfactory to the Agent with
respect to the use and disbursement of funds in any the Borrower Account.  Each of the Borrower Accounts shall be
subject to the Pledge and Security Agreement.

 

7.15                           Cash Flow; Payment
Direction Letters. 

 

7.15.1                  The Borrower
agrees that appropriate procedures satisfactory to the Agent will be put in
place such that (i) any Distributions by any Borrower Subsidiary payable to the
Borrower shall be directly deposited in the designated Depository Account in
the name of the Borrower, and (ii) any other Distributions or other revenues or
payments received by the Borrower, FT-FIN GP, or any Borrower Subsidiary or any
other Loan Party shall be directly deposited in a designated Depository Account
in the name of such Person.

 

7.15.2                  The Borrower
agrees that appropriate procedures satisfactory to the Agent will be put in
place such that subject to any limitations provided for with respect to any
Mortgage Debt: (i) any Distributions and other revenues due or payable to FT-FIN
GP and/or any Borrower Subsidiary shall be paid directly in to the designated
Depository Account in the name of the Borrower or as otherwise directed by the
Agent, and (ii) any Distributions by any Borrower Subsidiary payable to the
Borrower and/or FT-FIN GP shall be directly deposited in the designated
Depository Account in the name of the Borrower or as otherwise directed by the
Agent.  Further, subject to any
limitations provided for with respect to any Mortgage Debt, after the
occurrence and during the continuance of an Event of Default, Agent shall have
the right to receive any and all such Distributions or other revenues and make
application thereof to the Obligations.

 

7.15.3                  The use and
disbursement of all funds in the Depository Accounts and the Borrower Accounts
shall be subject to the terms and provisions hereof and the Cash Management
Agreement.

 

7.15.4                  The Borrower
agrees that to the extent that the Borrower, FT-FIN GP, any Borrower Subsidiary
or any other Loan Party receives directly any Distributions or revenues or
other payments which are required to be deposited as provided for herein, the
Borrower shall, and shall cause such Person to deposit such funds in the
applicable designated Depository Account as directed by the Agent.

 

7.15.5                  The Borrower
shall (and shall cause FT-FIN GP and the Borrower Subsidiaries and other Loan
Parties) to maintain in place during the term of the Loan such direction
letters and agreements as the Agent may from time to time require in order to
effectuate the terms and provisions hereof relating to the management of the
cash flow of such Persons (together with the Consents (to the extent that the
Consents provide for

 

36

 

the management of cash
flow), the “Payment Direction Letters”), including, without limitation, and
provided that such Payment Direction Letters are consistent with this Article 7,
including, without limitation, the following:

 

(a)                                  to
each tenant under a Lease for any Individual Property to pay rent, purchase
prices, and any other amounts payable under such Lease (a) to the holder (or
servicer) of the First Mortgage Debt thereon, or (b) if there exists no First
Mortgage Debt on an Individual Property, to the designated Depository Account
of such Property Owner;

 

(b)                                 for
each Property Owner (a) with each holder (or servicer) of the First Mortgage
Debt on any Individual Property to pay excess proceeds after debt service to
the designated Depository Account in the name of the applicable Borrower
Subsidiary or, subject to the terms of Section 7.15, as otherwise may be
directed by the Agent, or (b) if there exists no First Mortgage Debt on an
Individual Property, to pay excess proceeds after debt service to the
designated Depository Account of such Property Owner;

 

(c)                                  with
the Borrower Subsidiary to pay any Distribution or other amount due to the
Borrower or FT-FIN GP into a designated Depository Account in the respective
Person’s name or, subject to the terms of Section 7.15, as otherwise
directed by the Agent;

 

(d)                                 after
the occurrence and during the continuance of an Event of Default, such
additional Payment Direction Letters so as to direct payment of all funds due,
or Distributions payable, to the Borrower, FT-FIN GP, and any Borrower
Subsidiaries into the designated Depository Account in the name of the Borrower
or, subject to the terms of Section 7.15, as otherwise directed by the
Agent; and

 

(e)                                  such
other Payment Direction Letters as Agent may direct from time to time in
accordance with the provisions of this Agreement and the other Loan Documents.

 

7.15.6                  the Borrower
shall (and shall cause FT-FIN GP, and the other Loan Parties to) keep in effect
all Payment Direction Letters, including, without limitation, any replacements,
substitutions, or renewals thereof as the Agent shall reasonably deem
appropriate from time to time.

 

7.16                           Distributions.

 

7.16.1                  Subject to the
requirements set forth in clause (h)(xvi) of the definition of “Single-Purpose
Entity” contained herein, the Borrower shall cause the Borrower Subsidiaries to
make the maximum amount of all Distributions to the Borrower and FT-FIN GP,
respectively, at the earliest opportunity permitted under the respective
Formation Documents of each of the Borrower Subsidiaries, but not less often
than quarterly or within three (3) Business Days of the receipt of any funds
relating to a Mandatory Prepayment Event and shall take all actions necessary
(and as may be directed by the Agent) to preserve and maintain the Distribution
scheme provided for herein.

 

37

 

7.16.2                  the Borrower
shall cause the Borrower Subsidiaries to deposit all Distributions made or
payable to the Borrower and/or FT-FIN GP in a designated Depository Account in
the name of the Borrower or, subject to the terms of Section 7.15, as
otherwise directed by the Agent.

 

7.17                           Exercise of Ground Lease
Extension Options.  The Borrower
shall (and shall cause the Property Owners, as applicable, to) provide evidence
to the Agent of the due exercise of each and every Ground Lease Extension
Option at least thirty (30) days prior to the last date for such exercise
(being no less than ninety (90) days prior to the subject Ground Lease term
expiration date).  In the event that
Borrower fails to provide such evidence to the Agent in a timely fashion, the
Agent shall be authorized to exercise the rights provided for in the Escrow
Agreement Respecting Ground Lease Extensions with respect thereto.  Borrower shall provide the Agent with all
instruments, documents, and agreements requested by the Agent with respect to
foregoing provisions of this Section 7.17.

 

7.18                           Costs and Expenses.  The Borrower shall pay all costs and expenses
(excluding salaries or wages of employees of Agent) reasonably incurred by
Agent in connection with the implementation and syndication of the Loan and the
administration of the Loan, and reasonably incurred by the Agent or any of the
Lenders in connection with the enforcement of the Agent’s and Lenders’ rights
under the Loan Documents, including, without limitation, legal fees and
disbursements, appraisal fees, inspection fees, plan review fees, travel costs
and fees and out-of-pocket costs of independent engineers and consultants.  The Borrower’s obligations to pay such costs
and expenses shall include, without limitation, all attorneys’ fees and other
costs and expenses for preparing and conducting litigation or dispute
resolution arising from any breach by the Borrower or the Loan Parties of any
covenant, warranty, representation or agreement under any one or more of the
Loan Documents.  Unless an Event of
Default has occurred and is then continuing, the Agent shall use its best
efforts to notify the Borrower prior to the incurrence of any such cost or expense
if the aggregate amount of such costs and expenses in any one calendar year
will exceed $10,000.00; provided, however, that the failure shall provide such
notice shall not affect in any manner whatsoever on the Borrower’s obligations
hereunder.

 

7.19                           Appraisals 

 

7.19.1                  Appraisal.
Agent shall have the right at its option, from time to time, to order an
appraisal of one or more of the Individual Properties prepared at Agent’s
direction by an appraiser selected by Agent (the “Appraisal”).  An appraiser selected by Agent shall be an
MAI member with appropriate experience appraising commercial properties in the
respective area(s) of the Individual Properties and otherwise qualified
pursuant to provisions of applicable laws and regulations under and pursuant to
which Agent operates).

 

7.19.2                  Costs of
Appraisal.  The Borrower shall pay
for the costs of (i) each Appraisal and (ii) each updated Appraisal only after
the occurrence and during the continuance of an Event of Default; provided,
however, Borrower shall not be required to pay for more than one appraisal per
year, per property.

 

7.20                           Indemnification.  The Borrower shall at all times, both before
and after repayment of the Loan, at its sole cost and expense defend,
indemnify, exonerate and save harmless Agent and each of the Lenders and all
those claiming by, through or under Agent and each of the

 

38

 

Lenders (“Indemnified Party”) (to the extent not paid by the Borrower
in this Section 7.20 or under the applicable provisions of this or any
other Loan Document) against and from all damages, losses, liabilities,
obligations, penalties, claims, litigation, demands, defenses, judgments,
suits, proceedings, costs, disbursements or expenses of any kind whatsoever,
including, without limitation, attorneys’ fees and experts’ fees and
disbursements, which may at any time (including, without limitation, before or
after discharge or foreclosure of the Security Documents) be imposed upon,
incurred by or asserted or awarded against the Indemnified Party and arising
from or out of:

 

(a)                                  any
liability for damage to person or property arising out of any violation of any
Legal Requirement with respect to the Borrower, any other Loan Party or any
Individual Property, or

 

(b)                                 any
and all liabilities, damages, penalties, costs, and expenses, relating in any
manner to any brokerage or finder’s fees in respect of the Loan, or

 

(c)                                  as
a result of litigation that may arise in connection with Borrower’s activities,
or

 

(d)                                 the
payment of any fees to any Loan Party or any manager or owner of the Borrower;
or

 

(e)                                  any
act, omission, negligence or conduct at any Individual Property, or arising or
claimed to have arisen, out of any act, omission, negligence or conduct of the
Borrower or any tenant, occupant or invitee thereof which is in any way related
to any Individual Property.

 

Notwithstanding the foregoing,
an Indemnified Party shall not be entitled to indemnification in respect of
claims arising from acts of its own gross negligence or willful misconduct to
the extent that such gross negligence or willful misconduct is determined by
the final judgment of a court of competent jurisdiction, not subject to further
appeal, in proceedings to which such Indemnified Party is a proper party.

 

7.21                           Leasing Matters.

 

7.21.1                  Agent’s Approval
Required.

 

(a)                                  Except
as provided for herein, the Property Owners shall not require the approval of
the Agent or the Lenders for any proposed Lease of an Individual Property.

 

(b)                                 Agent’s
prior written approval shall be required in each instance as to any proposed
Lease which represents the conversion of a substantially single-tenant
Individual Property to a substantially multi-tenant Individual Property.

 

(c)                                  Agent’s
prior written approval shall be required in each instance as to any proposed
Lease for 25,000 or more rentable square feet, but less than 75,000 rentable
square feet, unless the Borrower evidences to the Agent that (x) the rental
rate under the proposed Lease is equal to or greater than the rental rate for
the first renewal term in the Lease in effect for the subject Individual
Property

 

39

 

as of the Closing Date
and (y) the rating, if any, of the new tenant is equal to or higher than the
rating for the tenant under such existing Lease.

 

(d)                                 Agent’s
and Required Lenders prior written approval shall be required in each instance
as to any proposed Lease for 75,000 or more rentable square feet.

 

(e)                                  For
any Lease requiring approval hereunder, the approval shall relate to: (i) the
economic and other terms of the Lease; (ii) each tenant under a proposed Lease;
(iii) each guarantor, if any, of a tenant’s obligations under a proposed Lease;
(iv) any modification or amendment to the Lease, if such modification or
amendment relates to the amount of rent payable thereunder, the term of the
Lease, the Economic Discontinuance Rights provided for therein, or any other
term which may have a material impact on the value of the Individual Property
or the rental payments due under the Lease; and (v) any termination,
cancellation or surrender of the Lease.

 

7.21.2                  Borrower’s
Requests.  Any request by the
Borrower for an approval from Agent with respect to leasing matters shall be
sent to the Agent and shall be accompanied, at a minimum, by the following: (i)
the proposed lease or amendment or modification thereof complete with all
applicable schedules and exhibits; (ii) a complete copy of any proposed
guaranty; (iii) comprehensive financial information with respect to the
proposed tenant and, if applicable, the proposed guarantor (as to new leases or
amendments or modifications to existing leases involving material economic
changes); and (iv) an executive summary of the terms and conditions of the
proposed lease and, if applicable, the proposed guaranty.

 

7.21.3                  Response.  The Agent (and the Required Lenders, as
applicable) shall act on requests from the Borrower for any approval required
under Section 7.21 in a commercially reasonable manner and shall use
commercially reasonable efforts to respond to any such request within (a)
fifteen (15) Business Days for approvals required under Section 7.21(b)
and (c) above, and (b) twenty (20) Business Days for approvals required under Section 7.21(d)
above, in each instance following Agent’s receipt thereof with all required supporting
information.  Agent’s response may
consist of an approval or disapproval of the request, or a conditional approval
thereof subject to specified conditions, or a request for further data or
information, or any combination thereof. 
If Agent (and the Required Lenders, as applicable) fails to respond to
any such request within such prescribed time period, such request shall be
deemed approved by the Agent (and the Required Lenders, as applicable).  In order to expedite the processing of
requests for such approvals, the Borrower agrees to provide Agent with as much
advance information as is possible in a commercially reasonable manner in
advance of the Borrower’s formal request for an approval.

 

7.22                           Future Collateral
Obligations.  The Borrower acknowledges
that the determination by the Agent as to the Collateral was based upon an
analysis of the assets owned by the Borrower and the Borrower Subsidiaries, and
the assets owned by Loan Parties that are parties to the Security Documents.
The Borrower shall (and shall cause each of the other Loan Parties to) agree to
the following undertaking:

 

40

 

7.22.1                  In the event
that at any time the Borrower or any Loan Party acquires or obtains any
interest in any asset relating to the Borrower or the business operations of
the Borrower and the Borrower Subsidiaries, including, without limitation, (i)
the fee, remainderman or ground lessor interest in any Individual Property, or
(ii) any interest in any Mortgage Debt, the Borrower shall notify the Agent in
writing and shall execute, or cause the applicable Person to execute, such
documents as shall be reasonably requested by the Agent to confirm, or
establish, that the interest so acquired or obtained is included within the
Collateral and to effectuate the terms and provisions of this Agreement with
respect thereto.

 

7.22.2                  The Borrower
agrees that without the prior consent of the Agent, no other Loan Party will
acquire or obtain any interest in any asset related to the operation, ownership
or management of the Individual Properties or any of the other assets of the
Borrower, FT-FIN GP, or the Borrower Subsidiaries unless such Person shall
execute such documents as shall be reasonably requested by the Agent to
confirm, or establish, that the interest so acquired or obtained is included
within the Collateral (or if such Person cannot grant such security interest to
the Agent, that the ownership interest in the entity holding such asset is
included within the Collateral) and to effectuate the terms and provisions of
this Agreement with respect thereto.

 

7.22.3                  In the event
that at any time the Borrower shall establish or acquire a Person such that
such Person is a Borrower Subsidiary, the Borrower shall notify the Agent in
writing and shall execute, or cause the applicable Borrower Subsidiary to
execute, such documents as shall be reasonably requested by the Agent to
confirm, or establish, that the ownership interests in such Borrower Subsidiary
and the assets of such Subsidiary (other than the assets of Property Owners)
are included within the Collateral (subject to any existing Liens associated
with any such asset) and to effectuate the terms and provisions of this
Agreement with respect thereto.

 

7.22.4                  In the event
that at any time the Borrower or any Borrower Subsidiary acquires or obtains
any interest in any asset (other than an Individual Property), the Borrower
shall notify the Agent in writing and shall execute, or cause the applicable
Borrower Subsidiary to execute, such documents as shall be reasonably requested
by the Agent to confirm, or establish, that the asset so acquired or obtained
is included within the Collateral (subject to any existing Liens associated
with any such asset) and to effectuate the terms and provisions of this
Agreement with respect thereto (if the value of the asset acquired is less than
$1,000,000.00, the notification and documentation will be provided annually).

 

7.22.5                  In the event
that at any time due to the rejection of a Rejectable Offer, the applicable
Lease terminates and the applicable Property Owner is the owner of an
Individual Property without any Mortgage Debt thereon, at the option of the
Agent, the Property Owner shall grant to the Agent, on behalf of the Lenders, a
mortgage or deed of trust interest in and to said Individual Property;
provided, however, in the event of a subsequent Permitted Refinance, or other
refinance with the written consent of the Agent, of the Individual Property,
the Agent shall release the said mortgage or deed of trust to the refinanced
loan subject to the payment of the Borrower Mandatory Principal Payment
relating thereto.

 

41

 

7.22.6                  In the event
that at any time due to the acceptance of a Rejectable Offer, a so called “Exchange
Property” is conveyed to the applicable Property Owner so that it is the owner
of the “Exchange Property” without any Mortgage Debt thereon, at the option of
the Agent, the Property Owner shall grant to the Agent, on behalf of the Lenders,
a mortgage or deed of trust interest in and to said Individual Property;
provided, however, in the event of the subsequent Permitted Refinance, or other
refinance with the written consent of the Agent, of the “Exchange Property”,
the Agent shall release the said mortgage or deed of trust to the refinanced
loan subject to the payment of the Borrower Mandatory Principal Prepayment
relating thereto.

 

7.22.7                  Upon the payment
in full of the Mortgage Debt on any Individual Property or if at any time any
Individual Property is free and clear of all Mortgage Debt, at the option of
the Agent, the applicable Property Owner shall grant to the Agent, on behalf of
the Lenders, a mortgage or deed of trust interest in and to said Individual
Property; provided, however, in the event of the subsequent Permitted
Refinance, or other refinance with the consent of the Agent of the Individual
Property, the Agent shall release the said mortgage or deed of trust to the
refinanced loan subject to the payment of the Borrower Mandatory Principal
Prepayment relating thereto.

 

7.22.8                  the Borrower
agrees to provide to the Agent written notice of any of the events described in
this Section 7.22 within five (5) Business Days of Knowledge thereof by
the Borrower and further agrees to execute and deliver any documents as
reasonably requested by the Agent to effectuate the terms and provisions hereof
within five (5) Business Days of the Agent’s request therefor.

 

7.23                           Economic Discontinuance.

 

7.23.1                  Within ten (10)
Business Days of receipt thereof, the Borrower shall cause the applicable
Property Owner to provide to the Agent a copy of each Rejectable Offer received
by any Property Owner, and concurrently with the giving thereof, and within
five (5) Business Days of receipt thereof copies of any subsequent notices
received with respect thereto, whether from the tenant exercising the Economic
Discontinuance Rights, the applicable holder of the remainderman interest in
the subject Individual Property, the applicable ground lessor, or any other Person.

 

7.23.2                  No later than
forty-five (45) days prior to the last day for the Property Owner to reject the
Rejectable Offer, the Borrower shall provide to the Agent in writing the
determination by the Borrower as to whether it requests the approval of the
acceptance or rejection of the Rejectable Offer, which notice shall include the
Officer’s Certificate required in accordance with subsection 7.23.4 or
7.23.5, below, with supporting detail necessary for the Agent to verify the
calculations incorporated therein.

 

7.23.3                  Except as
otherwise provided for herein, in connection with the exercise by a tenant of
the Economic Discontinuance Rights, the Borrower shall not, and shall cause
each Property Owner not to grant, approve, reject or object to any requested
consent or approval, including, without limitation, the acceptance or rejection
of a so called “Exchange Offer”, without the written approval of the Agent.

 

42

 

7.23.4                  Subject to the
compliance with any applicable terms relating to the Mortgage Debt and, if
applicable, the Ownership Interest Agreement, (i) the Borrower may accept any
Rejectable Offer if (a) any required Mandatory Principal Prepayment relative
thereto is to be paid to the Agent upon the consummation of the Economic
Discontinuance Sale, (b) no Default or Event of Default is then occurring or
will occur as a result of the consummation of the subject Economic
Discontinuance Sale, (c) the Borrower is in compliance with the Financial
Covenants and will not fail to be in compliance therewith as a result of the
consummation of the subject Economic Discontinuance Sale, and (d) the Borrower
submits to the Agent an Officer’s Certificate reflecting a pro-forma
calculation that the Borrower will be in compliance with the Financial
Covenants after the consummation of the subject Economic Discontinuance Sale,
or (ii)the Borrower shall accept the Rejectable Offer if approved in writing by
the Agent;

 

7.23.5                  Subject to the
compliance with any applicable terms relating to the Mortgage Debt and, if
applicable, the Ownership Interest Agreement, (i) the Borrower may reject any
Rejectable Offer if (a) the Borrower is in compliance with the Rejection Test
and will not fail to be in compliance therewith as a result of the consequences
of the rejection of the Rejectable Offer, (b) no Default or Event of Default is
then occurring or will occur as a result of the consequences of the rejection
of the Rejectable Offer, (c) the Borrower submits to the Agent an Officer’s
Certificate reflecting a pro-forma calculation that the Borrower will be in
compliance with the Financial Covenants, and the Rejection Test after giving
effect to the financial consequences of the rejection of the Rejectable Offer
or (ii) the Borrower shall reject the Rejectable Offer if approved in writing
by the Agent;

 

7.23.6                  As used herein,
the “Rejection Test” shall mean that the aggregate outstanding Mortgage Debt on
all ED Properties (assuming for purposes of this calculation, that the subject
Rejectable Offer is rejected and included therein) shall be less than the ED
Cash Flow.  The Term “ED Cash Flow” shall
mean the projected Free Cash Flow for the succeeding twelve (12) month period,
excluding (a) all cash flow from all ED Properties, and (b) all cash flow from
any Individual Property after the date on which the existing term of the lease
for such Individual Property expires, unless an applicable extension option
shall have been exercised.

 

7.24                           Replacement Documentation.  Upon receipt of an affidavit of an officer of
Agent as to the loss, theft, destruction or mutilation of the Note or any other
Security Document which is not of public record, and, in the case of any such
loss, theft, destruction or mutilation, upon surrender and cancellation of such
Note or other Security Document, the Borrower will issue, in lieu thereof, a
replacement Note or other security document in the same principal amount and
otherwise of like tenor upon receipt by the Borrower of a suitable indemnity.

 

7.25                           Other Covenants.  The Borrower hereby represents and warrants
that no Collateral is in the possession of any third party bailee (such as at a
warehouse).  In the event that the
Borrower and/or any of the other Loan Parties, after the date hereof, intends
to store or otherwise deliver any Collateral or other personal property in
which the Agent has been granted a security interest to such a bailee, then the
Borrower shall receive the prior written consent of the Agent and such bailee
must acknowledge in writing that the bailee is holding such Collateral or such
other personal property for the benefit of the Agent and the Lenders.

 

43

 

7.26                           Related Documents.  The Borrower will, or will cause each
Borrower Subsidiary and FT -FIN GP to, comply with the terms and provisions of
all of the Related Documents.

 

7.27                           Single-Purpose Entity.

 

7.27.1                  the Borrower
shall cause each Borrower Subsidiary to be a Single-Purpose Entity and to
comply with the terms and provisions hereof with respect thereto.

 

7.28                           Financial Covenants.  The Borrower shall comply with the following
financial covenants:

 

7.28.1                  Debt Service
Coverage Ratios.

 

(a)                                  Certain
Definitions.

 

(i)                                     “Calculation
Date” shall mean the last day of each calendar quarter commencing with December 31,
2004.

 

(ii)                                  “Calculation
Period” shall mean each successive twelve (12) month period ending on a
Calculation Date.

 

(iii)                               “Debt
Service” shall mean (A) the sum of the aggregate regularly scheduled actual
principal and interest paid or payable respecting all Debt of the Borrower and
the Borrower Subsidiaries (but excluding any Mandatory Principal Prepayments
and/or required principal amortization as provided in Section 2.5.1)
during the subject Calculation Period, less (B) with respect to interest
payments required with respect to the Loan, the amount paid to the Borrower or
the Agent pursuant to any Interest Rate Protection Agreement relating to
interest due during the subject Calculation Period.

 

(iv)                              “Debt
Service Coverage” shall mean the ratio for the Calculation Period of:  (A) Net Cash Flow to (B) Debt Service.

 

(v)                                 “
Net Cash Flow” shall mean the aggregate of (i) that portion of the Consolidated
Net Cash Flow which is available to the Borrower, as Distributions or
otherwise, from Borrower Subsidiaries (after payment of that portion of
Consolidated Debt Service in connection with the First Mortgage Debt, and
operating costs and expenses specifically attributable to the Borrower’s
Subsidiaries), all of the foregoing as determined solely by the Agent in a
manner consistent with the procedures and methods utilized by the Agent in
analyzing the financial information provided by the Borrower prior to closing.

 

(vi)                              “Consolidated
Debt Service Coverage” shall mean the ratio for the Calculation Period of:  (A) Consolidated Net Cash Flow to (B)
Consolidated Debt Service.

 

(vii)                           “Consolidated
Net Cash Flow” shall mean the sum of (i) (a) all cash revenues from the
aggregate of all of the Borrower’s

 

44

 

Subsidiaries, including,
without limitation, all rents, management fees, ground rent, common area
maintenance charges, insurance premium and tax reimbursements and proceeds from
rental interruption insurance, less the aggregate of (ii) all operating
costs and expenses (excluding Consolidated Debt Service) of the Borrower and
the Borrower’s Subsidiaries related to such investments, amounts reserved for
taxes and insurance, replacement reserves, and capital expenditures, all of the
foregoing as reasonably determined by the Agent in a manner consistent with the
procedures and methods utilized by the Agent in analyzing the financial
information provided by the Borrower prior to closing.

 

(viii)                        “Consolidated
Debt Service” shall mean (A) the sum of the aggregate actual principal and
interest paid or payable respecting all Debt of the Borrower and the Borrower’s
Subsidiaries (but excluding, for the purposes of this definition, debt service
with respect any Mandatory Principal Prepayments and/or required principal
amortization as provided in Section 2.5.1), on a consolidated basis,
during the Calculation Period less (B) with respect to interest payments
required with respect to the Loan, the amount paid to the Borrower or the Agent
pursuant to any Interest Rate Protection Agreement relating to interest due
during the subject Calculation Period.

 

(b)                                 Minimum
Consolidated Debt Service Coverage. 
The Consolidated Debt Service Coverage for each Calculation Period
determined on each Calculation Date shall be not less than 1.15:1.  The compliance with the Consolidated Debt
Service Coverage covenant shall be tested by the Agent on the Calculation Date
with results based upon the most recent Calculation Period results, as
reasonably determined by the Agent in a manner consistent with the procedures
and methods utilized by the Agent in analyzing the financial information
provided by the Borrower prior to closing. 
If such Consolidated Debt Service Coverage covenant shall not be
satisfied on any Calculation Date, the Borrower shall prepay a sufficient
amount of principal outstanding on the Loan such that if such principal
reduction had been made on the first day of the Calculation Period the
Consolidated Debt Service Coverage covenant would have been satisfied.  It shall be an Event of Default if the
Borrower fails to make such a prepayment not later than the first to occur of:
(i) ten (10) Business Days after notice from Agent to the Borrower properly
requesting the payment, or (ii) if the Borrower has failed to give Agent
sufficient reports to enable Agent to make the necessary calculations,
forty-five (45) days following the applicable Calculation Date, provided the
Borrower shall have an additional five (5) days to supply additional
information to the Agent from the date the Agent notifies the Borrower that the
initial reports have been deemed insufficient by the Agent.

 

(c)                                  Minimum
Debt Service Coverage.  The Debt
Service Coverage for each Calculation Period determined on each Calculation
Date shall be not less than 1.40:1.  The
compliance with the Debt Service Coverage covenant shall be tested by the Agent
on the Calculation Date with results based upon the most recent Calculation
Period results, as reasonably determined by the Agent in a

 

45

 

manner consistent with
the procedures and methods utilized by the Agent in analyzing the financial
information provided by the Borrower prior to closing.  If such Debt Service Coverage covenant shall
not be satisfied on any Calculation Date, the Borrower shall prepay a
sufficient amount of principal outstanding on the Loan such that if such
principal reduction had been made on the first day of the Calculation Period
the Debt Service Coverage covenant would have been satisfied.  It shall be an Event of Default if the
Borrower fails to make such a prepayment not later than the first to occur of:
(i) ten (10) Business Days after notice from Agent to the Borrower properly
requesting the payment, or (ii) if the Borrower has failed to give Agent
sufficient reports to enable Agent to make the necessary calculations,
forty-five (45) days following the applicable Calculation Date, provided the
Borrower shall have an additional five (5) days to supply additional
information to the Agent from the date the Agent notifies the Borrower that the
initial reports have been deemed insufficient by the Agent.

 

7.28.2                  Consolidated
Leverage Ratio.  The quotient
resulting from dividing (i) the sum of (1) the Borrower’s allocable share of
the aggregate amount of all Debt respecting the Borrower’s Investments
(including, without limitation, the outstanding balance of the Loan) by (ii)
the aggregate of (1) Aggregate Investment Capitalization of the Borrower’s
allocable share of all the Borrower’s Investments (the “Consolidated Leverage
Ratio”), plus (2) plus all cash and cash equivalents of the Borrower and the
Borrower Subsidiaries, all as reasonably determined by the Agent in a manner
consistent with the procedures and methods utilized by the Agent in analyzing
the financial information provided by the Borrower prior to closing, shall at
all times be less than seventy-five (75%) percent.

 

The compliance with the
Consolidated Leverage Ratio covenant shall be tested by the Agent on the
Calculation Date with results based upon then current financial information, as
reasonably determined solely by the Agent. 
If such Consolidated Leverage Ratio covenant shall not be satisfied on
any Calculation Date, the Borrower shall prepay a sufficient amount of
principal outstanding on the Loan such that if such principal reduction had
been made on the Calculation Date the Consolidated Leverage Ratio covenant
would have been satisfied on such Calculation Date.  It shall be an Event of Default if the
Borrower fails to make such a prepayment not later than the first to occur of:
(i) ten (10) Business Days after Notice from Agent to the Borrower properly
requesting the payment, or (ii) if the Borrower has failed to give Agent and
each of the Lenders sufficient reports to enable Agent to make the necessary
calculations, forty-five (45) days following the applicable Calculation Date,
provided the Borrower shall have an additional five (5) days to supply
additional information to the Agent from the date the Agent notifies the
Borrower that the initial reports have been deemed insufficient by the Agent.

 

7.28.3                  Minimum
Liquidity.  The sum of all of First
Union’s Liquid Assets (excluding, however, the Liquid Assets of any Borrower
Subsidiary as to which there exists a default or event of default on any Mortgage
Debt of such Borrower Subsidiary) must at all times be at least $10,000,000.00,
as evidenced by First Union’s annual and quarterly SEC filings.  If such Minimum Liquidity shall not be
satisfied on any date of testing, First Union shall arrange for an infusion of
Liquid Assets in an amount necessary

 

46

 

to satisfy the
requirements of this Section 7.28.3. 
It shall be an Event of Default if First Union fails to arrange for any
required additional Liquid Assets not later than ten (10) Business Days after
Notice from Agent to the Borrower notifying the Borrower of the noncompliance.

 

7.28.4                  Minimum Net
Worth.  Minimum Net Worth of First
Union shall at all times be equal to or greater than $40,000,000.00.  “Minimum Net Worth” shall mean the
consolidated net worth of First Union as evidenced by First Union’s annual and
quarterly SEC reports.  The compliance
with the Minimum Net Worth covenant shall be tested by the Agent on each
Calculation Date.  If such Minimum Net
Worth covenant shall not be satisfied on any Calculation Date, the Borrower
shall prepay a sufficient amount of principal outstanding on the Loan such that
if such principal reduction had been made on the Calculation Date the Minimum
Net Worth covenant would have been satisfied on such Calculation Date.  It shall be an Event of Default if the
Borrower fails to make such a prepayment not later than the first to occur of:
(i) ten (10) Business Days after Notice from Agent to the Borrower properly
requesting the payment, or (ii) if the Borrower has failed to give Agent and
each of the Lenders sufficient reports to enable Agent to make the necessary
calculations, forty-five (45) days following the applicable Calculation Date,
provided the Borrower shall have an additional five (5) days to supply
additional information to the Agent from the date the Agent notifies the
Borrower that the initial reports have been deemed insufficient by the Agent.

 

ARTICLE 8

 

NEGATIVE
COVENANTS.  

 

The Borrower covenants and agrees that from
the date hereof and so long as any Obligations remain outstanding hereunder,
the Borrower shall not (and shall not suffer or permit the other Loan Parties
and/or the Borrower Subsidiaries to):

 

8.1                                 No Changes to the
Borrower and other Loan Parties. 
Without the prior written consent of the Agent, which consent will not
be unreasonably withheld, after not less than thirty (30) days’ prior written
notice (with reasonable particularity of the facts and circumstances attendant
thereto):(i) change its jurisdiction of organization, (ii) change its
organizational structure or type, (iii) change its legal name, or (iv) change
the organizational number (if any) assigned by its jurisdiction of formation or
its federal employer identification number (if any).

 

8.2                                 Restrictions on
Liens.  Create, incur, assume or
suffer to exist any Lien upon or with respect to any property or assets (real
or personal, tangible or intangible, including, without limitation, the
Individual Properties), whether now owned or hereafter acquired, or sell any
such property or assets subject to an understanding or agreement, contingent or
otherwise, to repurchase such property or assets (including sales of accounts
receivable with recourse) or assign any right to receive income or permit the
filing of any financing statement under the UCC or any other similar notice of
Lien under any similar recording or notice statute, or grant rights with
respect to, or otherwise encumber or create a security interest in, such
property or assets (including, without limitation, any item of Collateral) or
any portion thereof or any other revenues therefrom or the proceeds payable
upon the sale, transfer or other disposition of such property or asset or any
portion thereof, or permit or suffer any such action to be taken, except the
following (singly and collectively, “Permitted Liens”):

 

47

 

8.2.1                        Liens
created by the Loan Documents;

 

8.2.2                        Liens for
taxes, assessments or other governmental charges not yet delinquent or which
are being diligently contested in good faith and by appropriate proceedings, if
(x) reasonable reserves in an amount not less than the tax, assessment or
governmental charge being so contested shall have been established in a manner
reasonably satisfactory to the Agent or deposited in cash (or cash equivalents)
with the Agent to be held during the pendency of such contest, or such
contested amount shall have been duly bonded in accordance with applicable law,
(y) no risk of sale, forfeiture or loss of any interest in any Individual
Property or the Collateral or any part thereof arises during the pendency of
such contest and (z) such contest does not have and could not reasonably be
expected to have a Material Adverse Effect;

 

8.2.3                        Liens in
respect of property or assets imposed by law, which were incurred in the
ordinary course of business and do not secure Debt, such as carriers’,
warehousemen’s, materialmen’s and mechanics’ liens and other similar Liens
arising in the ordinary course of business, and (x) which do not in the
aggregate materially detract from the value of any property or assets or have,
and could not reasonably be expected to have, a Material Adverse Effect or (y)
which are being contested in good faith by appropriate proceedings, which
proceedings have the effect of preventing the forfeiture or sale of the
property or assets subject to any such Lien;

 

8.2.4                        Liens
existing as of the Closing Date in favor of the holders of the Mortgage Debt;

 

8.2.5                        A Lien on
an Individual Property which may be granted to secure a Permitted Refinance;
and

 

8.2.6                        To the
extent that the Borrower or any Borrower Subsidiary or any Loan Party acquires
any other asset, any Lien as to which the acquisition of such asset is subject.

 

8.3                                 Consolidations,
Mergers, Sales of Assets, Issuance and Sale of Equity.  (i) 
Dissolve, terminate, liquidate, consolidate with or merge with or into
any other Person, (ii) issue, sell, lease, transfer or assign to any Persons or
otherwise dispose of (whether in one transaction or a series of transactions)
any portion of its assets (whether now owned or hereafter acquired), including,
without limitation, any securities, membership or partnership interests, or
other interests of any kind in any other Loan Party or Borrower Subsidiary,
directly or indirectly (whether by the issuance of rights of, options or
warrants for, or securities convertible into, any such security, membership or
partnership interests or other interests of any kind), (iii) withdraw from or
resign as general partner or managing member of any Person, including, without
limitation, any withdrawal or resignation of: (x) Park Plaza as the sole member
of the Borrower, or (y) FT-FIN GP as the general partner of a Borrower
Partnership, (iv) permit another Person to merge with or into it, (v) acquire
all or substantially all the capital stock, membership or partnership interests
or assets of any other Person, or (vi) take any action which could have the
effect, directly or indirectly, of diluting the economic interest of any Loan
Party in any other Loan Party or Borrower Subsidiary; except the following:

 

48

 

8.3.1                        Transfers
pursuant to the Security Documents and other agreements in favor of Agent on
behalf of the Lenders;

 

8.3.2                        Transfers
or mergers to facilitate a Permitted Investment (to the extent required, the
Agent shall release any security interest which it may have thereon to
effectuate such transfer or merger);

 

8.3.3                        Mergers,
consolidations, transfers and sales between and among Loan Parties of
partnership interests, membership interests or capital stock, so long as after
giving effect to any such merger, consolidation, transfer or sale, the Agent
shall have a security interest, directly or through its security interest in
the partnership interests, membership interests or capital stock of another
Loan Party, in the partnership interests, membership interests or capital stock
of each Borrower Subsidiary which is the survivor of such merger or
consolidation or the recipient of such partnership interests, membership
interests or capital stock transferred and/or sold, provided that in no event
may any such merger, consolidation, transfer or sale cause a Change of Control
or otherwise adversely affect the interests of the Agent and/or the Lenders, as
determined solely by the Agent;

 

8.3.4                        Sales of
any Individual Property in connection with an Economic Discontinuance Sale,
subject to the terms and conditions of  Section 7.23
and payment of the required Mandatory Principal Prepayment related thereto (to
the extent required, the Agent shall release any security interest which it may
have thereon to effectuate such sale); provided, however, the sale of the
Sherman, Texas, Individual Property to The Kroger Co. pursuant to the
Rejectable Offer letter dated April 29, 2004 shall be deemed approved by
the Agent and the Lenders;

 

8.3.5                        Sales of
any Individual Property (other than in connection with an Economic
Discontinuance Sale) or the ownership interest of the Borrower and/or FT-FIN GP
in any Property Owner or, with the prior consent of the Agent; provided (a) the
Agent receives the Mandatory Principal Payment required under Section 2.5.1(b)
above, (b) the purchaser is an unaffiliated third party, and (c) the Borrower
submits to the Agent an Officer’s Certificate reflecting a pro-forma
calculation that such sale will not result in any decrease in or negatively
impact the existing level of the Borrower’s performance under the Financial
Covenants considering the consequences of the sale (to the extent required, the
Agent shall release any security interest which it may have thereon to
effectuate such sale);

 

8.3.6                        Sales or
dispositions in the ordinary course of business of worn, obsolete or damaged
items of personal property or fixtures which are suitably replaced (to the
extent required, the Agent shall release any security interest which it may
have thereon to effectuate such sale or disposition);

 

8.3.7                        Leases to
the extent provided for herein;

 

8.3.8                        Transfers
of ownership interests in the Borrower and/or FT-Fin GP to entities which are,
directly or indirectly, wholly owned subsidiaries of First Union;  and

 

8.3.9                        Transactions,
whether outright or as security, for which Agent’s prior written consent has
been obtained.

 

49

 

8.4                                 Restrictions on
Debt.  (i) Create, incur or assume
any Debt, (ii) enter into, acquiesce, suffer or permit any amendment,
restatement or other modification of the documentation evidencing and/or
securing any Debt under which it is an obligor, or (iii) increase the amount of
any Debt existing as of the Closing Date; except with respect to the following
(singly and collectively, “Permitted Debt”):

 

8.4.1                        The
Obligations;

 

8.4.2                        The
following Debt existing as of the Closing Date in the amount disclosed to the
Agent hereunder:

 

(a)                                  the
Mortgage Debt (none of which is recourse to the Borrower, except for the type
of recourse obligation set forth in Section 8.4.4, below);

 

(b)                                 Debt
described in Schedule 8.4.2(b) annexed hereto;

 

8.4.3                        Any
refinancing of any Mortgage Debt provided such refinancing is, unless otherwise
approved by the Agent, at an interest rate equal to or less than the existing
rate under the applicable First Mortgage and with a term and amortization schedule not
in excess of the existing term and amortization schedule under the First
Mortgage (a “Permitted Refinance”); provided, however, that no refinancing of
any Debt otherwise permitted hereunder shall be allowed unless and until:

 

(a)                                  the
Agent has received at least thirty (30) days’ prior written notice of any
intended refinancing, which notice shall detail with specificity the terms and
conditions of any such refinancing and shall include complete copies of any
loan application and loan commitment respecting such proposed refinancing,
together with such other materials and information as the Agent shall
reasonably request;

 

(b)                                 no
Default or Event of Default shall have occurred and then be continuing; and

 

(c)                                  the
Borrower has provided the Agent with such instruments, documents, agreements,
certifications, and opinions as the Agent shall reasonably require with respect
thereto.

 

8.4.4                        With
respect to any Mortgage Debt, obligations under (i) limited guaranties by the
Borrower as to usual and customary exceptions to non-recourse provisions (e.g.,
fraud and misappropriation of funds) provided that such limited guaranties are
evidenced by documentation approved by the Agent and (ii) indemnifications by
the Borrower as to usual Hazardous Materials issues relating to the subject
Individual Property provided that such indemnifications are evidenced by
documentation customary for transactions of that type;

 

8.4.5                        Indebtedness
incurred in the ordinary course of business for the purchase of goods or
services which are payable, without interest, within thirty (30) days of
billing; and

 

50

 

 

8.4.6                        Transactions,
whether secured or unsecured, for which Agent’s prior written consent has been
obtained.

 

8.5                                 Respecting
Individual Properties.  Permit or
otherwise suffer to occur any event such that the representations and
warranties of the Borrower set forth in Section 6.17 would be untrue or
misleading in any material respect.

 

8.6                                 Respecting Ground
Lease Extension Options and Remainder Ground Lease Options.  Permit any of the Ground Lease Extension
Options and/or Remainder Ground Lease Options, including, without limitation,
any conditions precedent therein, to lapse, expire, or otherwise remain
unexercised, or otherwise permit the expiration of any Ownership Interest
Agreement, without the express prior written consent of the Agent.

 

8.7                                 Other Business.  Enter into any line of business or make any
material change in the nature of its business, purposes or operations, except
as otherwise specifically permitted by this Agreement or the other Loan
Documents.

 

8.8                                 Change of Control.  Permit or otherwise suffer to occur any
Change of Control.

 

8.9                                 Forgiveness of Debt.  Cancel or otherwise forgive or release any
Debt owed to it by any Person, except upon receipt of adequate consideration or
as otherwise approved by the Agent.

 

8.10                           Affiliate Transactions.  On and after the Closing Date, enter into, or
be a party to, any transaction with any Person who is an Affiliate of the
Borrower, or any Borrower Subsidiary, or any Loan Party, except for (i) any
property management contract for an Individual Property which is no longer
subject to a triple net lease with a management fee not to exceed three (3%)
percentof gross revenue per year, and (ii) any construction management contract
for improvements to be made to any Individual Property or Permitted Investment
acquisition with a construction management fee not to exceed five (5%) percent
of the gross cost of the construction of improvements, provided that this Section 8.10
shall not apply to transactions between and among Loan Parties or to
transactions between Loan Parties and Borrower Subsidiaries.

 

8.11                           Amendments; Terminations
of Related Documents.  Enter into,
acquiesce in, suffer or permit any amendment, restatement or other modification
or termination of any of the Related Documents, without the express prior
written consent of the Agent.

 

8.12                           ERISA.  Except for Code Section 401(k) plans,
establish or be obligated to contribute to any Plan.

 

8.13                           Bankruptcy Filings.  File a petition under any state or federal
bankruptcy or insolvency laws or the liquidation of all or a major portion of
its assets or property.

 

8.14                           Investment Company.  Become an “investment company” or a company “controlled”
by an “investment company,” within the meaning of the Investment Company Act of
1940, as amended.

 

8.15                           Holding Company.  Become a “holding company,” or a “subsidiary
company” of a “holding company,” or an “affiliate” of a “holding company” or of
a “subsidiary company” of

 

51

 

a “holding company,” within the meaning of the Public Utility Holding
Company Act of 1935, as amended.

 

8.16                           Use of Proceeds.  Permit the proceeds of the Loan, or any other
accommodation at any time made hereunder, to be used for any purpose which
entails a violation of, or is inconsistent with, Regulation T, U or X of the
Board of Governors of the Federal Reserve, or for any purpose other than those
set forth in Section 1.3.

 

8.17                           Advances and Loan.  Except as contemplated herein in connection
with the Loan Advances of the Obligations, directly or indirectly, lend money
or credit or make advances to any Person.

 

8.18                           Distributions.  (i) Authorize, declare, or pay any
Distributions on behalf of the Borrower, except for Permitted Distributions or
(ii) take any action which would amend, modify, or terminate any Distribution
due, or the terms of any Formation Document relating to Distributions due, to
the Borrower, FT-FIN GP, or any Borrower Subsidiary.  The term “Permitted Distributions” shall
mean, so long as no Default or Event of Default exists and is continuing, or
would be created thereby, subject to requirements set forth in Section 9.2,
hereof, any Distributions by the Borrower in accordance with its Formation
Documents.

 

8.19                           Restrictions on
Investments.  Make or permit to exist
or to remain outstanding any Investment except which is or results in (“Permitted
Investments”):

 

8.19.1                  marketable
direct or guaranteed general obligations of the United States of America which
mature within one year from the date of purchase;

 

8.19.2                  bank deposits,
certificates of deposit and banker’s acceptances, or other obligations in or of
the Lenders or banks located within and chartered by the United States of
America or a state and having assets of over $500,000,000.00; and

 

8.19.3                  the Borrower’s
Subsidiaries, subject in all instances to the terms of this Agreement;

 

8.19.4                  the acquisition
of any asset related to the operation, ownership or management of the
Individual Properties or any of the other assets of the Borrower or the
Borrower Subsidiaries; and

 

All such Investments shall be
made by the Borrower in a manner which assures that Agent shall have and
maintain a perfected first lien security interest therein.

 

8.20                           Contracts of a Material
or Significant Nature.  Except for
contracts otherwise complying with this Agreement, not enter into any other
contracts, agreements or purchase orders which would involve the expenditure of
more than $1,000,000.00 in any instance or $1,000,000.00 in the aggregate
without Agent’s prior written consent, which consent shall not be unreasonably
withheld or delayed, but which consent may be conditioned upon a demonstration
by the Borrower to Agent’s reasonable satisfaction that the contract, agreement
or purchase order is reasonable and that the Party entering into such contract
has adequate resources to pay and perform the same.

 

52

 

8.21                           Consulting or Management
Fees.  Permit the payment of any
asset management fees to any Person or enter into any agreement providing asset
management services to the Borrower or any Borrower Subsidiary which provides
for the payment of asset management fees, except pursuant to any property
management contract for an Individual Property which is no longer subject to a
triple net lease on terms and conditions customary in the relevant market area.

 

8.22                           Negative Pledges, etc.  Enter into any agreement subsequent to the
Closing Date (other than a Loan Document) which (a) prohibits the creation or
assumption of any Lien upon any of the Collateral, including, without
limitation, any hereafter acquired property, (b) specifically prohibits the
amendment or other modification of this Agreement or any other Loan Document,
or (c) could reasonably be expected to have a Material Adverse Effect.

 

8.23                           Business Transactions.  Conduct any business activities that relate,
directly or indirectly, to the Property Owners, their properties or assets
through any Person other than the Borrower and/or FT-FIN GP, except pursuant to
the structure of ownership existing as of the Closing Date and disclosed to the
Agent.

 

ARTICLE 9

 

SPECIAL
PROVISIONS.

 

9.1                                 Legal Requirements.  The Borrower, FT-FIN GP, or any Borrower
Subsidiary may contest in good faith any claim, demand, levy or assessment
under any Legal Requirements or taxes owed by any person or entity if: (i) the
contest is based upon a material question of law or fact raised by such Person
in good faith; (ii) such Person properly commences and thereafter diligently
pursues the contest; (iii) the contest will not materially impair the ability
to ultimately comply with the contested Legal Requirement should the contest
not be successful; (iv) reasonable reserves in an amount necessary to undertake
and pay for such contest and any corrective or remedial action then or
thereafter reasonably likely to be necessary shall have been established in a
manner satisfactory to the Agent or deposited in cash (or cash equivalents)
with the Agent to be held during the pendency of such contest, or such
contested amount shall have been duly bonded in accordance with applicable law;
(v) if the contest relates to a Legal Requirement under Environmental Law, the
conditions set forth in the Environmental Indemnity relating to such contests
shall be satisfied; (vi) no risk of sale, forfeiture or loss of any interest in
any Individual Property or the Collateral or any part thereof arises during the
pendency of such contest; and (vii) such contest does not have and could not
reasonably be expected to have a Material Adverse Effect.

 

9.2                                 Distributions.

 

9.2.1                        Notice
of Intention to Distribute.  At least
ten (10) Business Days prior to making any Distribution to its owners, each of
the Borrower and FT-FIN GP shall submit to Agent a written statement of its
intent to make such Distribution accompanied by an Officer’s Certificate
reflecting a pro-forma calculation that the Borrower will be in compliance with
the Financial Covenants after the proposed Distribution, together with such
other documentation and information as Agent may reasonably require (“Notice of
Intention to Distribute”) in order to verify that the Borrower and/or FT-FIN GP
is entitled to make a Distribution as provided for herein.

 

53

 

9.2.2                        Conditions
Must Be Satisfied.  If the Agent
objects to such proposed Distribution on the basis that the conditions thereto
are not satisfied, or that further information is required, Agent may, by
written notice to the Borrower given within ten (10) Business Days following
receipt of the Borrower’s Notice of Intention to Distribute, prohibit the
proposed Distribution by Borrower and/or FT-FIN GP until such time as the Agent
is reasonably satisfied that the conditions have been satisfied.

 

9.2.3                        Current
Information.  Once Agent has received
a Notice of Intention to Distribute and a Distribution has been made in
accordance with the foregoing, subsequent Notices of Intention to Distribute
submitted within the next twelve (12) months shall not require the submission
of new financial information if the Borrower submits a sworn affidavit and
unconditional representation that there have been no material adverse changes,
unless Agent has a good faith basis for requiring the same.

 

9.3                                 Limited Recourse
Provisions.

 

9.3.1                        Borrower
Fully Liable.  The Borrower shall be
fully liable for the Loan and the Obligations to each of the Lenders.

 

9.3.2                        Certain
Non-Recourse.  The Loan shall be on a
non-recourse basis to First Union, except to the extent provided for in the
Limited Non-Recourse Carve Out Guaranty.

 

9.3.3                        Additional
Matters.  Nothing contained in this Section 9.3
or elsewhere shall: (i) limit the right of Agent or any of the Lenders to
obtain injunctive relief or to pursue equitable remedies under any of the Loan
Documents, excluding only any injunctive relief ordering payment of obligations
by any Person or entity for which personal liability does not otherwise exist;
or (ii) limit the liability of any attorney, law firm, accountant or other
professional who or which renders or provides any written opinion or
certificate to Agent or any of the Lenders in connection with the Loan even
though such person or entity may be a member of the Borrower.

 

9.4                                 Payment of
Obligations.  Upon the payment in
full of the Obligations, in immediately available funds, including, without
limitation, all unreimbursed costs and expenses of the Agent and of each Lender
for which the Borrower is responsible, the Agent shall release any security and
other collateral interests, including, without limitation, the Payment
Direction Letters, rights of setoff and right to freeze granted to the Agent as
provided for herein and under the other Loan Documents and shall execute and
deliver such documents and termination statements as the Borrower or any other
Loan Party reasonably requests to evidence such termination and release.  However, such release by the Agent shall not
be deemed to terminate or release any Person from any obligation or liability
under the Loan Documents which specifically by its terms survives the payment
in full of the Obligations.

 

ARTICLE 10

 

EVENTS OF
DEFAULT

 

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

 

54

 

10.1                           Default and Events of
Default.  The term “Default” as used
herein or in any of the other Loan Documents shall mean an Event of Default, or
any fact or circumstance which constitutes, or upon the lapse of time, or
giving of notice, or both, could constitute, an Event of Default. The
occurrence of any of the following events, respectively, shall, subject to the
giving of any notice or the expiration of any applicable grace period referred
to in Section 10.2 without the cure thereof, constitute an “Event of
Default” herein.  Upon the occurrence of
any Event of Default described in Sections 10.1.8, any and all Obligations
shall become due and payable without any further act on the part of the Agent.
Upon the occurrence of any other Event of Default, the Agent may declare any
and all Obligations immediately due and payable.  The occurrence and continuance of any Event
of Default shall also constitute, without notice or demand, a default under all
other agreements between the Agent and/or the Lenders and the Borrower and
instruments and papers heretofore, now, or hereafter given the Agent and/or the
Lenders by the Borrower.

 

10.1.1                  Failure to
Pay the Loan.  The failure by the
Borrower to pay when due any principal of, interest on, or fees in respect of,
the Loan.

 

10.1.2                  Failure to
Make Other Payments.  The failure by
the Borrower to pay when due (or upon demand, if payable on demand) any payment
the Obligation other than any payment the Obligation on account of the
principal of, or interest on, or fees in respect of, the Loan.

 

10.1.3                  Note,
Security Documents, and Other Loan Documents.  Any other default in the performance of any
term or provision of the Note, or of the Security Documents, or of any of the
other Loan Documents, or a breach, or other failure to satisfy, any other term,
provision, condition or warranty under the Note, the Security Documents, or any
other Loan Document, regardless of whether any then undisbursed portion of the
Loan is sufficient to cover any payment of money required thereby, and the
specific grace period, if any, allowed for the default in question shall have
expired without such default having been cured.

 

10.1.4                  Default under
Other Agreements.  The occurrence of
any breach of any covenant or Obligation imposed by, or of any default under,
any agreement (including any Loan Document) between the Agent and/or the
Lenders and the Borrower, the other Loan Parties, and/or the Property Owners or
instrument given by the Borrower and such Persons to the Agent and/or the
Lenders and the expiry, without cure, of any applicable grace period
(notwithstanding that the Agent and/or the Lenders may not have exercised all
or any of its/their rights on account of such breach or default).

 

10.1.5                  Representations
and Warranties.  If any
representation or warranty made by the Borrower or by any of the other Loan
Parties or the Borrower Subsidiaries in the Loan Documents was untrue or
misleading in a manner which could reasonably be expected to have a Material
Adverse Effect.

 

10.1.6                  Affirmative
Covenants.  The breach of any covenant
contained in Sections Article 7 herein, including, without limitation, the
Financial Covenants.

 

10.1.7                  Negative
Covenants.  The breach of any
covenant contained in Article 8 herein.

 

55

 

10.1.8                  Financial
Status and Insolvency.

 

(a)                                  the
Borrower shall: (i) admit in writing its inability to pay its debts generally
as they become due; (ii) file a petition in bankruptcy or a petition to take
advantage of any insolvency act; (iii) make an assignment for the benefit of
creditors; (iv) consent to, or acquiesce in, the appointment of a receiver,
liquidator or trustee of itself or of the whole or any substantial part of its
properties or assets; (v) file a petition or answer seeking reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under the Federal Bankruptcy laws or any other applicable law; (vi) have
a court of competent jurisdiction enter an order, judgment or decree appointing
a receiver, liquidator or trustee of the Borrower, or of the whole or any
substantial part of the property or assets of the Borrower, and such order,
judgment or decree shall remain unvacated or not set aside or unstayed for
sixty (60) days; (vii) have a petition filed against it seeking reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under the Federal Bankruptcy laws or any other applicable law and such
petition shall remain undismissed for sixty (60) days; (viii) have, under the
provisions of any other law for the relief or aid of debtors, any court of
competent jurisdiction assume custody or control of the Borrower or of the
whole or any substantial part of its property or assets and such custody or
control shall remain unterminated or unstayed for sixty (60) days; or (ix) have
an attachment or execution levied against any substantial portion of the
property of the Borrower or against any substantial portion of the Collateral
which is not discharged or dissolved by a bond within thirty (30) days; or

 

(b)                                 any
such event set forth in subsection (i) above shall occur with respect to a
Borrower Subsidiary, FT-FIN GP, and/or any other Loan Party;

 

10.1.9                  Loan
Documents.  If any Loan Document for
any reason other than the satisfaction in full of all Obligations shall cease
to be in full force and effect (other than in accordance with its terms),
thereby preventing the Agent and/or the Lenders from obtaining the practical
realization of the benefits thereof, or if any Loan Document shall be declared
null and void or any Loan Party shall claim or declare any such Loan Document
to no longer be in full force and effect or is null and void, or if the Liens
and security interests purported to be created by any of the Loan Documents
shall cease to be valid, perfected, first priority (except as otherwise
expressly provided herein) security interests;

 

10.1.10            Judgments.  One or more judgments or decrees shall be
entered against the Borrower or any other Loan Party or Borrower Subsidiary
involving a liability (not paid or fully covered by a reputable and solvent
insurance company) and such judgments and decrees either shall be final and
non-appealable or shall not be vacated, discharged or stayed or bonded pending
appeal for any period of sixty (60) consecutive days, and the aggregate amount
of all such judgments exceeds $500,000.00;

 

10.1.11            Default of Other
Specified Debt and Related Documents. 
If a Default or Event of Default (regardless of how or if defined) shall
occur under any Mortgage Debt as to which Default or Event of Default the
holder has accelerated the obligations due thereunder and commenced exercising
its rights upon such Default or Event of Default;

 

56

 

10.1.12            ERISA.  (i) If any Plan shall fail to satisfy the
minimum funding standard required for any plan year or part thereof or a waiver
of such standard or extension of any amortization period is sought or granted
under Section 412 of the Code, any Plan shall have had or is likely to
have a trustee appointed to administer such Plan, any Plan is, shall have been
or is likely to be terminated or to be the subject of termination proceedings
under ERISA, any Plan shall have an Unfunded Current Liability, a contribution
required to be made to a Plan has not been timely made, the Borrower or any
Borrower Subsidiary or any ERISA Affiliate has incurred or is likely to incur a
liability to or on account of a Plan under Section 409, 502(i), 502(l),
515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29),
4971, 4975 or 4980 of the Code, or the Borrower or any Borrower Subsidiary has
incurred or is likely to incur liabilities pursuant to one or more employee
welfare benefit plans (as defined in Section 3(l) of ERISA) that provide
benefits to retired employees or other former employees (other than as required
by Section 601 of ERISA) or employee pension benefit plans (as defined in Section 3(2)
of ERISA) and any of the foregoing could have a Material Adverse Effect;
(ii) if there shall result from any such event or events the imposition of
a lien, the granting of a security interest, or a liability or a material risk
of incurring a liability which could have, or reasonably be expected to have, a
Material Adverse Effect; or (iii) if which lien, security interest or
liability, individually, and/or in the aggregate, in the opinion of the Agent
could have, or reasonably be expected to have, a Material Adverse Effect.

 

10.1.13            Change of Control.  If a Change of Control shall occur.

 

10.1.14            Indictment;
Forfeiture.  The indictment of, or
institution of any legal process or proceeding against, the Borrower, any other
Loan Party, and/or any Borrower Subsidiary under any applicable law where the
relief, penalties, or remedies sought or available include the forfeiture of
any property of the Borrower and/or any other such Person and/or the imposition
of any stay or other order, the effect of which could reasonably be expected to
have a Material Adverse Effect.

 

10.1.15            Default of Other
Obligations.  Any failure by the
Borrower to pay at maturity, or within any applicable grace period, any
obligation for borrowed money, or in respect of any capitalized lease, or any
failure to observe or perform any material term, covenant or agreement
contained in any agreement by which the Borrower is bound, evidencing or
securing borrowed money, or in respect of any capitalized lease, such that the
holder or holders thereof or of any obligations issued thereunder have
accelerated the maturity thereof.

 

10.1.16            Termination of
Guaranty or the Borrower Consent. 
The termination or attempted termination of (i) any Guaranty by any
Guarantor of the Obligations, or (ii) any Indemnification by any Indemnitor.

 

10.1.17            Generally.  A default by the Borrower in the performance
of any term, provision or condition of this Agreement to be performed by the
Borrower, or a breach, or other failure to satisfy, any other term provision,
condition, covenant or warranty under this Agreement and such default remains
uncured beyond any applicable specific grace period provided for in this
Agreement, or as set forth in Section 10.2. below.

 

57

 

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

 

10.2.1                  No Notice or
Grace Period.  Except for any grace
or notice period specifically provided for in any referenced section of
this Agreement, there shall be no grace period and no notice provision with
respect to the payment of principal at maturity and no grace period and no
notice provision with respect to defaults related to the voluntary filing of
bankruptcy or reorganization proceedings or an assignment for the benefit of
creditors, or with respect to a breach of warranty or representation as set
forth in Section 10.1.5, or with respect to the breach of any of the
affirmative covenants set forth in Sections 7.28.1, 7.28.3, and 7.28.4.

 

10.2.2                  Nonpayment of
Interest and Principal.  As to the
nonpayment of interest, installments of principal, and in connection with a
Mandatory Principal Prepayment prior to maturity there shall be a ten (10)
Business Day grace period without any requirement of notice from Agent.

 

10.2.3                  Other
Monetary Defaults.  All other
monetary defaults shall have a five (5) Business Day grace period following
notice from Agent.

 

10.2.4                  Nonmonetary
Defaults.

 

(a)                                  As
to non-monetary default under Section 7.2, 7.5, 7.18, 7.21, or 7.22, or
with respect to the breach of any of the negative covenants set forth in Article 8,
there shall be a ten (10) day grace period following notice from Agent of such
default;

 

(b)                                 As
to non-monetary default under Section 7.16.1, or 7.27, there shall be a
five (5) day grace period following notice from Agent of such default;

 

(c)                                  As
to any other non-monetary default, unless there is a specific shorter or longer
grace period provided for in this Loan Agreement or in another Loan Document,
there shall be a thirty (30) day grace period following notice from Agent or,
if such default would reasonably require more than thirty (30) days to cure or
remedy, such longer period of time not to exceed a total of ninety (90) days
from Agent’s notice as may be reasonably required so long as Borrower shall
commence reasonable actions to remedy or cure the default within thirty (30)
days following such notice and shall diligently prosecute such curative action
to completion within such ninety (90) day period.  However, where there is an emergency situation
in which there is danger to person or property such curative action shall be
commenced as promptly as possible.  As to
breaches of warranties and representations (other than those related to
financial information) there shall be a thirty (30) day grace period following
notice from Agent.

 

58

 

ARTICLE 11

 

REMEDIES.

 

11.1                           Remedies.  Upon the occurrence and during the
continuance of an Event of Default, whether or not the indebtedness evidenced
by the Notes and secured by the Security Documents shall be due and payable or
Agent shall have instituted any foreclosure or other action for the enforcement
of the Security Documents or the Notes, Agent may, and shall upon the direction
of the Required Lenders, in addition to any other remedies which Agent may have
hereunder or under the other Loan Documents, or otherwise, and not in
limitation thereof, and in Agent’s sole and absolute discretion:

 

11.1.1                  Accelerate
Debt.  Agent may, and with the
direction of the Required Lenders shall, declare the indebtedness evidenced by
the Notes and secured by the Security Documents immediately due and payable
(provided that in the case of a voluntary petition in bankruptcy filed by the
Borrower or an involuntary petition in bankruptcy filed against the Borrower
(after expiration of the grace period, if any, set forth in Section 10.1.8),
such acceleration shall be automatic).

 

11.1.2                  Pursue
Remedies.  Agent may, and with the
direction of the Required Lenders shall, pursue any and all remedies provided
for hereunder, under any one or more of the other Loan Documents, and/or
otherwise.

 

11.2                           Written Waivers.  If a Default or an Event of Default is waived
by the Required Lenders, in their sole discretion, pursuant to a specific
written instrument executed by an authorized officer of Agent, the Default or
Event of Default so waived shall be deemed to have never occurred.

 

11.3                           Power of Attorney.  For the purpose of exercising the rights
granted by this Article 11, as well as any and all other rights and
remedies of Agent under the Loan Documents, the Borrower hereby irrevocably
constitutes and appoints Agent (or any agent designated by Agent) its true and
lawful attorney-in-fact, with full power of substitution, upon the occurrence
and during the continuance of any Event of Default, to execute, acknowledge and
deliver any instruments and to do and perform any acts in the name and on
behalf of the Borrower.  In connection
with the foregoing power of attorney, the Borrower hereby grants unto the Agent
(acting through any of its officers) full power to do any and all things after
the occurrence and during the continuance of an Event of Default necessary or
appropriate in connection with the exercise of such powers as fully and
effectually as the Borrower might or could do, hereby ratifying all that said
attorney shall do or cause to be done by virtue of this Agreement.  The foregoing power of attorney shall not be
affected by any disability or incapacity suffered by the Borrower and shall
survive the same.  All powers conferred
upon the Agent by this Agreement, being coupled with an interest, shall be
irrevocable until this Agreement is terminated by a written instrument executed
by a duly authorized officer of the Agent.

 

ARTICLE 12

 

SECURITY
INTEREST AND SET-OFF.

 

12.1                           Security Interest.  The Borrower hereby grants to the Agent and
each of the Lenders, a continuing lien, security interest and right of setoff
as security for all of the Obligations to Agent and each of the Lenders,
whether now existing or hereafter arising, upon and against all Depository
Accounts, Accounts, deposits, credits, collateral and property, now or
hereafter in the possession, custody, safekeeping or control of Agent or any of
the Lenders or any

 

59

 

entity under the control of KeyBank National Association and its
successors and assigns, or in transit to any of them.

 

12.2                           Set-Off.  After the occurrence and during the
continuance of any Event of Default, any such Depository Accounts, Accounts,
deposits, balances or other sums credited by or due from Agent, any affiliate
of Agent or any of the Lenders, or from any such affiliate of any of the
Lenders, to the Borrower may to the fullest extent not prohibited by applicable
law at any time or from time to time, without regard to the existence,
sufficiency or adequacy of any other collateral, and without notice or
compliance with any other condition precedent now or hereafter imposed by
statute, rule of law or otherwise, all of which are hereby waived, be set off,
appropriated and applied by Agent against any or all of the Borrower’s
Obligations irrespective of whether demand shall have been made, in such manner
as Agent in its sole and absolute discretion may determine.  Within three (3) Business Days of making any
such set off, appropriation or application, Agent agrees to notify the Borrower
thereof, provided the failure to give such notice shall not affect the validity
of such set off or appropriation or application.  ANY AND ALL RIGHTS TO REQUIRE AGENT OR ANY OF
THE LENDERS TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER
COLLATERAL WHICH SECURES A LOAN, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH
RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF SUCH BORROWER OR ANY
GUARANTOR, ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.

 

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

 

12.4                           Right to Freeze.  The Agent and each of the Lenders shall also
have the right, at its option, upon the occurrence and during the continuance
of any event which would entitle the Agent and each of the Lenders to set off
or debit as set forth in Section 12.2, to freeze, block or segregate any
such deposits, balances and other sums so that the Borrower may not access,
control or draw upon the same.

 

12.5                           Additional Rights.  The rights of Agent, the Lenders and each
affiliate of Agent and each of the Lenders under this Article 12 are in
addition to, and not in limitation of, other

 

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rights and remedies, including other rights of set off, which Agent or
any of the Lenders may have.

 

ARTICLE 13

 

THE AGENT
AND THE LENDERS

 

13.1                                                   Appointment.  KeyBank National Association is hereby
appointed as Agent hereunder and under each other Loan Document, and each
Lender hereby irrevocably authorizes the Agent to act as agent for Lender and
to take such actions as Lender is obligated or entitled to take under the
provisions of this Agreement and the other Loan Documents.  Agent agrees to act as such upon the express
conditions contained in this Article in substantially the same manner that
it would act in dealing with a loan held for its own account.  Agent shall not have a fiduciary relationship
with respect to any Lender by reason of this Agreement.  The provisions of this Article 13 which
do not expressly grant Borrower certain rights by direct reference to Borrower
are solely for the benefit of the Agent and the Lenders, and Borrower shall not
have any rights as a third party beneficiary of any of the provisions
hereof.  In performing its functions and
duties under this Agreement, the Agent shall act solely as agent of Lender and
does not assume, and shall not be deemed to have assumed, any obligations
toward or relationship of agency or trust with or for the Borrower, provided,
however, that nothing contained in this Article 13 shall be deemed to
release Agent or the Lenders from any of their obligations under this
Agreement.

 

13.2                                                   Reliance
on Agent.  All acts of and communications
by the Agent, as agent for the Lenders, shall be deemed legally conclusive and
binding; and Borrower or any third party (including any court) shall rely on
any and all communications or acts of the Agent with respect to the exercise of
any rights or the granting of any consent, waiver or approval on behalf of a
Lender in all circumstances where an action by such Lender is required or
permitted pursuant to this Agreement or the provisions of any other Loan
Document or by applicable law without the right or necessity of making any
inquiry of any individual Lender as to the authority of Agent with respect to
such matter.  In no event shall any of
the foregoing limit the rights or obligations of any Lender with respect to any
other Lender pursuant to this Article 13.

 

13.3                                                   Powers.  The Agent shall have and may exercise such
powers under the Loan Documents as are specifically delegated to the Agent by
the terms of each thereof, together with such powers as are reasonably
incidental thereto or are otherwise necessary or desirable in connection with
the administration of the Loan, and may exercise all other powers of Lender as
are not made subject to the consent of the Required Lenders pursuant to Section 13.26.1
or to the consent of all Lenders pursuant to Section 13.26.2.  Without limiting the foregoing, the Agent may
consent to or execute easements, plats, dedications, release of minor portions
of the collateral and similar documents. The Agent shall not be considered, or
be deemed, a separate agent of the Lenders hereunder, but is, and shall be
deemed, acting in its contractual capacity as Agent, exercising such rights and
powers under the Loan Documents as are specifically delegated to the Agent or
Agent is otherwise entitled to take hereunder. 
Agent shall have no implied duties to the Lenders, or any obligation to
the Lenders to take any action except any action specifically provided by the
Loan Documents to be taken by the Agent.

 

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13.4                                                   Disbursements.

 

13.4.1                  At least two (2) Business Days (by
11:00 a.m. Eastern Time) prior to each date a disbursement of the Loan is to be
made hereunder pursuant to this Agreement (or at least two (2) LIBOR Business
Days by 11:00 a.m. Eastern Time for any disbursements to be made at the
Adjusted LIBOR Rate), the Agent shall notify each Lender of the proposed
disbursement.  Each Lender shall make
available to Agent (or the funding Lender or entity designated by the Agent),
the amount of such Lender’s Percentage of such disbursement (with respect to
such Lender, such amount being referred to herein as an “Advance”) in
immediately available funds not later than 11:00 a.m. Eastern Time on the date
such disbursement is to be made (such date being referred to herein as a “Funding
Date”).  Unless the Agent shall have been
notified by any Lender prior to such time for funding in respect of any Advance
that such Lender does not intend to make available to the Agent such Lender’s
Advance, the Agent may assume that such Lender has made such amount available
to the Agent and the Agent, in its sole discretion, may, but shall not be
obligated to, make available to Borrower a corresponding amount.  If such corresponding amount is not in fact
made available to the Agent by such Lender on or prior to the respective
Funding Date, such Lender agrees to pay and Borrower agrees to repay to Agent
forthwith on demand such corresponding amount together with interest thereon,
for each day from the date such amount is made available to Borrower until the
date such amount is paid or repaid to Agent, at (A) in the case of such Lender,
the Federal Funds Effective Rate, and (B) in the case of Borrower, the interest
rate applicable at the time to a disbursement made on such Funding Date.  If such Lender shall pay to Agent such
corresponding amount, such amount so paid shall constitute such Lender’s
Advance, and if both such Lender and Borrower shall have paid and repaid,
respectively, such corresponding amount, Agent shall promptly return to
Borrower such corresponding amount in same day funds.  If any Lender declines to make available to
Agent such Lender’s advance as described above, so long as no Event of Default
has occurred and is continuing, upon written demand of Borrower, the Borrower
may require such Lender to sell and assign its entire interest in the Loan
pursuant to Section 13.22 hereof to an Eligible Assignee, reasonably
approved by Agent, upon payment by such Eligible Assignee of the entire par
amount of such Lender’s interest.

 

13.4.2                  Requests by the Agent for funding by
the Lenders of disbursements of the Loan will be made by facsimile.  Each Lender shall make its Advance available
to the Agent in dollars and in immediately available funds to such Lender and
account as the Agent may designate, not later than Noon Eastern Time on the
Funding Date.  Nothing in this Section 13.4
shall be deemed to relieve any Lender of its obligation hereunder to make any
Advance on any Funding Date, nor shall any Lender be responsible for the
failure of any other Lender to perform its obligations to make any Advance
hereunder, and the Commitment of any Lender shall not be increased or decreased
as a result of the failure by any other Lender to perform its obligation to
make any Advances hereunder.

 

13.4.3                  As soon as practical Agent will
promptly forward to each Lender copies of any draw request documents and, if
applicable, cause the Lender’s Consultant to forward to each Lender a copy of
the Lender’s Consultant’s most recent inspection.  Delivery of the draw request documents and
the Lender’s Consultant’s inspection report shall not be a condition to funding
any Advance.

 

13.5                                                   Distribution
and Apportionment of Payments.

 

13.5.1                  Subject to Section 13.5.3,
payments actually received by Agent for the account of the Lenders shall be
paid to them promptly after receipt thereof by Agent, but in any

 

62

 

event within one (1) Business Day, provided that, if any such payments
are not distributed to the Lenders within one (1) Business Day after Agent’s
receipt thereof, Agent shall pay to such Lenders interest thereon, at the
lesser of (i) the Federal Funds Effective Rate and (ii) if the applicable
payment represents repayment of a portion of the principal of the Loan, the
rate of interest applicable to such portion of the Loan, from the date of
receipt of such funds by Agent until such funds are paid in immediately
available funds to such Lenders provided such funds are received by Agent not
later than 11:00 A.M. Eastern Time on the date of receipt.  All payments of principal and interest in
respect of the Loan, all payments of the fees described in this Agreement (but
not in any separate fee letter except to the extent expressly set forth therein),
and all payments in respect of any other obligations of Borrower under the Loan
Documents shall be allocated among such of Lenders as are entitled thereto, in
proportion of their respective Percentages or otherwise as provided herein or
in the other Loan Documents, as the case may be.  The Agent shall distribute to each Lender at
its primary address set forth herein or in its Assignment and Assumption, or at
such other address as a Lender may request in writing, such funds as it may be
entitled to receive, provided that the Agent shall in any event not be bound to
inquire into or determine the validity, scope or priority of any interest or
entitlement of any Lender and may suspend all payments and seek appropriate
relief (including without limitation instructions from the Required Lenders, or
all Lenders, as applicable, or an action in the nature of interpleader) in the
event of any doubt or dispute as to any apportionment or distribution
contemplated hereby.  The order of
priority herein is set forth solely to determine the rights and priorities of
the Lenders as among themselves and may at any time or from time to time be
changed by the Lenders as they may elect, in writing, without necessity of
notice to or consent of or approval by Borrower.  The Agent shall upon each distribution noted
above promptly notify Borrower of such distribution and each Lender of the
amounts so distributed to it applicable to principal of, and interest on, the
proportionate share held by the applicable Lender.  Each payment to the Agent by Borrower as
noted in this Section shall constitute a payment by the Borrower to each
Lender in the amount of such Lender’s proportionate of such payment, and any
such payment to the Agent shall not be considered outstanding for any purpose
after the date of such payment by the Borrower to the Agent without regard to
whether or when the Agent makes distribution thereof as provided above.

 

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

 

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

 

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

 

Third:                                                                Pro
Rata to (a) all Lenders in accordance with their proportional share based upon
their respective Commitment Percentages until all Lenders have been paid in
full all principal and interest due to such Lenders under the Loan, with each
Lender applying such proceeds for purposes of this Agreement against the
outstanding principal balance and accrued and

 

63

 

unpaid interest due to such Lender under the
Loan in such fashion and priority as the Agent may direct, and (b) to the Agent
in connection with any Interest Rate Protection Agreement or other hedging or
protection arrangement entered into by the Borrower or any other party with the
KeyBank National Association with respect to the Loan.

 

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

 

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

 

13.5.3                                                                  If
a Lender (a “Defaulting Lender”) defaults in making any Advance or paying any
other sum payable by it hereunder, such sum together with interest thereon at
the Default Rate from the date such amount was due until repaid (such sum and
interest thereon as aforesaid referred to, collectively, as the “Lender Default
Obligation”) shall be payable by the Defaulting Lender (i) to any Lender(s)
which elect, at their sole option (and with no obligation to do so), to fund
the amount which the Defaulting Lender failed to fund or (ii) to Agent or
any other Lender which under the terms of this Agreement is entitled to
reimbursement from the Defaulting Lender for the amounts advanced or
expended.  Notwithstanding any provision
hereof to the contrary, until such time as a Defaulting Lender has repaid the
Lender Default Obligation in full, all amounts which would otherwise be
distributed to the Defaulting Lender shall instead be applied first to repay
the Lender Default Obligation (to be applied first to interest at the Default
Rate and then to principal) until the Lender Default Obligation has been repaid
in full (whether by such application or by cure by the Defaulting Lender),
whereupon such Lender shall no longer be a Defaulting Lender.  Any interest collected from Borrower on
account of principal advanced by any Lender(s) on behalf of a Defaulting Lender
shall be paid to the Lender(s) who made such advance and shall be credited
against the Defaulting Lender’s obligation to pay interest on the amount
advanced at the Default Rate.  If no
other Lender makes an advance a Defaulting Lender failed to fund, a portion of
the indebtedness of Borrower to the Defaulting Lender equal to the Lender
Default Obligation shall be subordinated to the indebtedness of Borrower to all
other Lenders and shall be paid only after the indebtedness of Borrower to all
other Lenders is paid.  The provisions of
this Section shall apply and be effective regardless of whether an Event
of Default occurs and is then continuing, and notwithstanding (i) any other
provision of this Agreement to the contrary or (ii) any instruction of Borrower
as to its desired application of payments. 
No Defaulting Lender shall have the right to vote on matters which are
subject to the consent or approval of Required Lenders or all Lenders and while
any Lender is a Defaulting Lender the requisite percentage of Lenders which
constitutes the Required Lenders shall be calculated exclusive of the
Percentage of the Defaulting Lender.  The
Agent shall be entitled to (i) withhold or set off, and to apply to the payment
of the Lender Default Obligation any amounts to be paid to such Defaulting
Lender under this Agreement, and (ii) bring an action or suit against such
Defaulting Lender in a court of competent jurisdiction to recover the Lender
Default Obligation and, to the extent such recovery would not fully compensate
the Lenders for the Defaulting Lender’s breach of this Agreement, to collect
damages.  In addition, the Defaulting
Lender shall indemnify, defend and hold Agent and each of the other Lenders
harmless from and against any and all claims, actions, liabilities, damages,

 

64

 

costs and expenses (including attorneys’ fees and expenses), plus
interest thereon at the Default Rate, for funds advanced by Agent or any other
Lender on account of the Defaulting Lender or any other damages such persons
may sustain or incur by reason of or as a direct consequence of the Defaulting
Lender’s failure or refusal to abide by its obligations under this Agreement.

 

13.5.4                  At least five Business Days prior to
the first date on which interest or fees are payable hereunder for the account
of any Lender, each Lender that is not incorporated under the laws of the
United States of America, or a state thereof, agrees that it will deliver to
each of the Agent and the Borrower two duly completed copies of United States
Internal Revenue Service Form W-8 BEN or W-8 ECI, certifying in either case
that such Lender is entitled to receive payments under this Agreement and the
Note without deduction or withholding of any United States federal income
taxes.  Each Lender which so delivers a
Form W-8 BEN or W-8 ECI further undertakes to deliver to the Agent two
additional copies of such form (or a successor form) on or before the date that
such form expires or becomes obsolete or after the occurrence of any event
requiring a change in the most recent forms so delivered by it, and such
amendments thereto or extensions or renewals thereof as may be reasonably
requested by the Agent, in each case certifying that such Lender is entitled to
receive payments under this Agreement and the Note without deduction or
withholding of any United States federal income taxes, unless any change in
treaty, law or regulation has occurred after the initial delivery required by
this Section 13.5.4 but prior to the date on which any such subsequent
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 with respect to it and such Lender advises the Agent that it is not
capable of receiving payments without any deduction or withholding of United
States federal income tax, provided, however, that if any such Lender so
advises the Agent, Agent shall promptly notify Borrower thereof, and so long as
no Event of Default has occurred and is continuing, upon written demand of
Borrower, the Borrower may require such Lender to sell and assign its entire
interest in the Loan pursuant to Section 13.22 hereof to an Eligible
Assignee, reasonably approved by Agent, upon payment by such Eligible Assignee
of the entire par amount of such Lender’s interest.

 

13.6                                                   Agency
Provisions Relating to Collateral.

 

13.6.1                  The Agent is hereby authorized on
behalf of all Lenders, without the necessity of any notice to or further
consent from any Lender, at any time and from time to time, to take any action
with respect to any collateral for the Loan or any Loan Document which may be
necessary to preserve and maintain such collateral or to perfect and maintain
perfected the liens upon such collateral granted pursuant to this Agreement and
the other Loan Documents.

 

13.6.2                  Except as provided in this Agreement,
the Agent shall have no obligation whatsoever to any Lender or to any other
person or entity to assure that any collateral exists or is owned by Borrower
or is cared for, protected or insured or has been encumbered or that the liens
granted herein or in any of the other Loan Documents or pursuant hereto or
thereto have been properly or sufficiently or lawfully created, perfected,
protected or enforced or are entitled to any particular priority.

 

13.6.3                  Should the Agent commence any
proceeding or in any way seek to enforce the Agent’s or the Lenders’ rights or
remedies under the Loan Documents, irrespective of whether as a result thereof
the Agent shall acquire title to any collateral, each Lender, upon demand
therefor from time to time, shall contribute its share (based on its
Percentage) of the reasonable

 

65

 

costs and/or expenses of any such enforcement or acquisition,
including, but not limited to, fees of receivers or trustees, court costs,
title company charges, filing and recording fees, appraisers’ fees and fees and
expenses of attorneys to the extent not otherwise reimbursed by Borrower.  Without limiting the generality of the
foregoing, each Lender shall contribute its share (based on its Percentage) of
all reasonable costs and expenses incurred by the Agent (including reasonable
attorneys’ fees and expenses) if the Agent employs counsel for advice or other
representation (whether or not any suit has been or shall be filed) with
respect to any collateral for the Loan or any part thereof, or any of the Loan
Documents, or the attempt to enforce any security interest or lien on any
collateral, or to enforce any rights of the Agent or the Lenders or any of
Borrower’s or any other party’s obligations under any of the Loan Documents,
but not with respect to any dispute between Agent and any other Lender(s).  It is understood and agreed that in the event
the Agent determines it is necessary to engage counsel for Lender from and
after the occurrence of a Default or Event of Default, said counsel shall be
selected by the Agent and written notice of such selection, together with a
copy of such counsel’s engagement letter and fee estimate, shall be delivered
to the Lenders.

 

13.6.4                  In the event that all or any portion
of the collateral for the Loan is acquired by the Agent as the result of the
exercise of any remedies hereunder or under any other Loan Document, or is
retained in satisfaction of all or any part of Borrower’s obligations under the
Loan Documents, title to any such collateral or any portion thereof shall be
held in the name of the Agent or a nominee or subsidiary of Agent, as agent,
for the ratable benefit of the Agent and the Lenders.  The Agent shall prepare a recommended course
of action for such collateral (the “Post-Default Plan”), which shall be subject
to the approval of the Required Lenders. 
The Agent shall administer the collateral in accordance with the
Post-Default Plan, and upon demand therefor from time to time, each Lender will
contribute its share (based on its Percentage) of all reasonable costs and expenses
incurred by the Agent pursuant to the Post-Default Plan, including without
limitation, any operating losses and all necessary operating reserves.  To the extent there is net operating income
from such collateral, the Agent shall, in accordance with the Post-Default
Plan, determine the amount and timing of distributions to Lenders.  All such distributions shall be made to
Lenders in accordance with their respective Percentages.  In no event shall the provisions of this subsection or
the Post-Default Plan require the Agent or any Lender to take an action which
would cause such Lender to be in violation of any applicable regulatory
requirements.

 

13.7                                                   Lender
Actions Against Borrower or the Collateral. 
Each Lender agrees that it will not take any action, nor institute any
actions or proceedings, against Borrower or any other person hereunder or under
any other Loan Documents with respect to exercising claims against the Borrower
or rights in any collateral without the consent of the Required Lenders.  With respect to any action by the Agent to
enforce the rights and remedies of the Agent and Lenders with respect to the
Borrower and any collateral in accordance with the terms of this Agreement,
each Lender hereby consents to the jurisdiction of the court in which such
action is maintained.

 

13.8                                                   Assignment
and Participation.  No Lender shall
be permitted to assign or sell all or any portion of its rights and obligations
under this Agreement to Borrower or any Affiliate of Borrower.

 

13.9                                                   Ratable
Sharing.  Subject to Sections 13.4
and 13.5, Lenders agree among themselves that (i) with respect to all amounts
received by them which are applicable to the payment of the Loan, equitable
adjustment will be made so that, in effect, all such amounts will

 

66

 

be shared among them ratably in accordance
with their Percentages, whether received by voluntary payment, by the exercise
of the right of set-off or bankers’ lien, by counterclaim or cross action or by
the enforcement of any or all of the Loan Documents or any collateral and (ii)
if any of them shall by voluntary payment or by the exercise of any right of
counterclaim, set-off, bankers’ lien or otherwise, receive payment of a
proportion of the aggregate amount of the Loan held by it which is greater than
its Percentage of the payments on account of the Loan, the one receiving such
excess payment shall purchase, without recourse or warranty, an undivided
interest and participation (which it shall be deemed to have done
simultaneously upon the receipt of such payment) in such obligations owed to
the others so that all such recoveries with respect to such obligations shall
be applied ratably in accordance with their Percentages; provided, that if all
or part of such excess payment received by the purchasing party is thereafter
recovered from it, those purchases shall be rescinded and the purchase prices
paid for such participations shall be returned to that party to the extent
necessary to adjust for such recovery, but without interest except to the
extent the purchasing party is required to pay interest in connection with such
recovery.  Borrower agrees that any
Lender so purchasing a participation from another Lender pursuant to this Section may,
to the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Lender were the direct creditor of Borrower in the amount of such
participation.

 

13.10                                             General
Immunity.  Neither Agent nor any of
its directors, officers, agents or employees shall be liable to Borrower or any
Lender for 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.  In the absence of gross negligence, the Agent
shall not be liable for any apportionment or distribution of payments made by
it in good faith pursuant to Section 13.5, and if any such apportionment
or distribution is subsequently determined to have been made in error the sole
recourse of any Lender to whom payment was due, but not made, shall be to
recover from the recipients of such payments any payment in excess of the
amount to which they are determined to have been entitled.

 

13.11                                             No
Responsibility for Loan, Recitals, etc. 
Neither 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 use of the Loan; (ii) the performance or observance
of any of the covenants or agreements of any party to any Loan Document;
(iii) the satisfaction of any condition specified in this Agreement,
except receipt of items purporting to be the items required to be delivered to
any Agent; or (iv) the validity, effectiveness or genuineness of any Loan
Document or any other instrument or writing furnished in connection therewith,
provided that the foregoing shall not release Agent from liability for its
gross negligence or willful misconduct.

 

13.12                                             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 all the Lenders (or the Required Lenders, if such action
may be directed hereunder by the Required Lenders), and such instructions and
any action taken or failure to act pursuant thereto shall be binding on all of
Lenders.  Each Lender, severally to the
extent of its Percentage, hereby agrees to indemnify Agent against and hold it
harmless from any and all liability, cost and expense that it may incur by
reason of taking or continuing to take any such action, provided that the
foregoing shall not release Agent from liability for its gross negligence or
willful misconduct.

 

67

 

13.13                                             Employment
of Agents and Counsel.  The Agent may
undertake any of its duties as Agent hereunder and under any other Loan
Document by or through employees, agents, and attorneys-in-fact and shall not
be liable to Lenders, except as to money or securities received by them or
their authorized agents, for the default or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care.  The 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.

 

13.14                                             Reliance
on Documents; Counsel.  The Agent
shall be entitled to rely upon any 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 Agent,
which counsel may be an employee of Agent, provided that the foregoing shall
not release the Agent from liability for its gross negligence or willful
misconduct.  Any such counsel shall be
deemed to be acting on behalf of Lender in assisting the Agent with respect to
the Loan, but shall not be precluded from also representing Agent in any matter
in which the interests of Agent and the other Lenders may differ.

 

13.15                     Agent’ Reimbursement and
Indemnification.  Lenders agree to
reimburse and indemnify Agent ratably (i) for any amounts (excluding
principal and interest on the Loan and loan fees) not reimbursed by Borrower
for which Agent is entitled to reimbursement under the Loan Documents,
(ii) for any other expenses incurred by Agent on behalf of Lender, in
connection with the preparation, execution, delivery, administration and
enforcement of the Loan Documents, if not paid by Borrower, (iii) for any
expenses incurred by Agent on behalf of Lender which may be necessary or
desirable to preserve and maintain collateral or to perfect and maintain
perfected the liens upon the collateral granted pursuant to this Agreement and
the other Loan Documents, if not paid by Borrower, (iv) for any amounts and
other expenses incurred by Agent on behalf of Lender in connection with any
default by any Lender hereunder or under the other Loan Documents, if not paid
by such Lender, and (v) 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 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, 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 of Agent.

 

13.16                     Rights as a Lender.  With respect to its Commitment, if any, Agent
shall have the same rights, powers and obligations hereunder and under any
other Loan Document as any Lender and may exercise such rights and powers as
though it were not an Agent, and the term “Lender” or “Lenders” shall, unless
the context otherwise indicates, include Agent in its individual
capacities.  The Borrower and each Lender
acknowledge and agree that Agent and/or its affiliates may accept deposits
from, lend money to, hold other investments in, and generally engage in any
kind of trust, debt, equity or other transaction or have other relationships,
in addition to those contemplated by this Agreement or any other Loan Document,
with Borrower or any of its affiliates in which Borrower or such affiliate is
not restricted hereby from engaging with any other person.

 

13.17                     Lenders’ Credit Decisions.  Each Lender acknowledges that it has,
independently and without reliance upon the Agent or any other Lender and based
on the financial statements

 

68

 

and other information prepared by 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 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.

 

13.18                     Notice of Events of Default.  Should Agent receive any written notice of
the occurrence of a default or Event of Default, or should the Agent send
Borrower a notice of Default or Event of Default, the Agent shall promptly
furnish a copy thereof to each Lender.

 

13.19                     Successor Agent.

 

13.19.1            Notwithstanding
anything contained in this Agreement to the contrary, KeyBank National
Association shall serve as Agent pursuant to this Agreement until the earlier
to occur of the following (the “Resignation Event”): (a) the occurrence of an
Event of Default, or (b) the date upon which the full Loan is advanced.  Following such a Resignation Event, Agent may
resign from the performance of all its functions and duties hereunder at any
time by giving at least thirty (30) days prior written notice to Lenders and
Borrower.  Such resignation shall take
effect on the date set forth in such notice or as otherwise provided
below.  Such resignation by Agent as
agent shall not affect its obligations hereunder, if any, as a Lender.

 

13.19.2            Upon resignation by
the Agent, or any successor Agent, the Required Lenders shall appoint a
successor Agent with the consent of Borrower, which shall not be unreasonably
withheld, conditioned or delayed (provided that no consent of Borrower shall be
required if the successor Agent is also a Lender or if an Event of Default then
exists).  If no successor Agent shall
have been so appointed by the Required Lenders, and shall have accepted such
appointment within thirty (30) days after the retiring Agent’s giving notice of
resignation, then the retiring Agent may appoint a successor Agent with the
consent of Borrower, which shall not be unreasonably withheld, conditioned or
delayed (provided that no consent of Borrower shall be required if the
successor Agent is also a Lender or if an Event of Default then exists).  Upon the acceptance of any appointment as an
Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the Agent and the Agent, and the retiring Agent shall be discharged from its
duties and obligations hereunder and under the other Loan Documents other than
its liability, if any, for duties and obligations accrued prior to its
retirement.  After any retiring Agent’s
resignation hereunder as an Agent, the provisions of this Article 13 shall
continue in effect for its benefit in respect of any actions taken or omitted
to be taken by it while it was acting as an Agent hereunder and under the other
Loan Documents.

 

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

 

69

 

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

 

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

 

13.22                     Assignment and Participation.

 

  Each Lender shall have the right to assign,
transfer, sell, negotiate, pledge or otherwise hypothecate this Agreement and
any of its rights and security hereunder and under the other Loan Documents to
any other Eligible Assignee with the prior written consent of the Agent and
with the prior written consent of Borrower, which consents by the Agent and the
Borrower shall not be unreasonably withheld, conditioned or delayed (provided
that, in the case of the Borrower, such consent shall not be required if a
Default or Event of Default shall have occurred and be continuing and provided,
further, such consent shall not be required from either the Agent or the
Borrower in connection with any assignment as to which (a) the assignee is an
existing Lender (other than a Defaulting Lender) or (b) an Affiliate or a
Related Fund of the assigning Lender)); provided, however, that (i) the parties
to each such assignment shall execute and deliver to Agent, for its approval
and acceptance, an Assignment and Assumption in form and substance satisfactory
to the Agent and substantially in the form set forth in Exhibit E
attached hereto, (ii) each such assignment shall be of a constant, and not a
varying, percentage of the assigning Lender’s rights and obligations under this
Agreement, (iii) unless the Agent and, so long as no Event of Default exists,
Borrower otherwise consent, the aggregate amount of the Commitment of the
assigning Lender being assigned pursuant to each such assignment shall in no
event be less than One Million Dollars ($1,000,000.00), provided, however, that
such minimum amount shall not apply if either (x) the assignee is an Affiliate
or Related Fund of the Assigning Lender or (y) the Lender is assigning its
entire remaining interest in the Loan, (iv) the Agent shall receive from
the assigning Lender a processing fee of Three Thousand Five Hundred Dollars
($3,500.00), provided, however, that such fee shall not apply if the assignee
is an Affiliate or Related Fund of the Assigning Lender, and (v) if the
assignment is less than the assigning Lender’s entire interest in the Loan, the
assigning Lender must retain at least a One Million Dollar ($1,000,000.00)
interest in the Loan, provided that such minimum shall not apply if the
assignee is an Affiliate or Related Fund of the assigning Lender.  The Agent may designate any Eligible Assignee
accepting an assignment of a specified portion of the Loan to be a Co-Agent, an
“Arranger” or similar title, but such designation shall not confer on such
Assignee the rights or duties of the Agent. 
Upon such execution, delivery, approval and acceptance, and upon the
effective date specified in the applicable Assignment and Assumption, (a) the
Eligible Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant

 

70

 

to such Assignment
and Assumption, have the rights and obligations of a Lender hereunder and under
the other Loan Documents, and Borrower hereby agrees that all of the rights and
remedies of Lenders in connection with the interest so assigned shall be
enforceable against Borrower by such Eligible Assignee with the same force and
effect and to the same extent as the same would have been enforceable but for
such assignment, and (b) the assigning Lender thereunder shall, to the extent
that rights and obligations hereunder and under the other Loan Documents have
been assigned by it pursuant to such Assignment and Assumption, relinquish its
rights and be released from its obligations hereunder and thereunder thereafter
accruing.  Notwithstanding anything
contained in this Section 13.22 to the contrary, prior to the occurrence
of an Event of Default, (x) KeyBank National Association shall at all times
hold not less than twenty-five percent (25%) of the Lenders’ interest in the
Loan and (y) KeyBank National Association’s interest in the Loan shall at all
times equal or exceed the interest of each other Lender.

 

13.22.1            By executing and
delivering an Assignment and Assumption, the assigning Lender thereunder and
the Eligible Assignee thereunder confirm to and agree with each other and the
other parties hereto as follows:  (i)
except as provided in such Assignment and Assumption, such assigning Lender
makes no representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in connection with
this Agreement or any other Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any
other Loan Document or any other instrument or document furnished in connection
therewith; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower of any of its
obligations under any Loan Document or any other instrument or document
furnished in connection therewith; (iii) such Eligible Assignee confirms that
it has received a copy of this Agreement together with such financial
statements, Loan Documents and other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into the
Assignment and Assumption and to become a Lender hereunder; (iv) such Eligible
Assignee will, independently and without reliance upon Agent, the assigning
Lender or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under this Agreement; (v) such Eligible Assignee
appoints and authorizes the Agent to take such action as the Agent on its
behalf and to exercise such powers under this Agreement and the other Loan Documents
as are delegated to Agent by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto; and (vi) such Eligible Assignee
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to be performed
by it as a Lender.

 

13.22.2            Agent shall maintain a
copy of each Assignment and Assumption delivered to and accepted by it and
shall record in its records the names and address of each Lender and the Commitment
of, and Percentage of the Loan owing to, such Lender from time to time.  Borrower, the Agent and Lenders may treat
each entity whose name is so recorded as a Lender hereunder for all purposes of
this Agreement.

 

71

 

13.22.3            Upon receipt of an
Assignment and Assumption executed by an assigning Lender and an Eligible
Assignee, Agent shall, if such Assignment and Assumption has been properly
completed and consented to if required herein, accept such Assignment and
Assumption, and record the information contained therein in its records, and
the Agent shall use its best efforts to give prompt notice thereof to Borrower
(provided that neither the Agent nor the Lenders shall be liable for any
failure to give such notice).

 

13.22.4            Borrower shall use
reasonable efforts to cooperate with Agent and each Lender in connection with
the assignment of interests under this Agreement or the sale of participations
herein which shall be at no cost to the Borrower.

 

13.22.5            Anything in this
Agreement to the contrary notwithstanding, and without the need to comply with
any of the formal or procedural requirements of this Agreement, including this
Section, any Lender may at any time and from time to time pledge and assign all
or any portion of its rights under all or any of the Loan Documents to a
Federal Reserve Bank or, in the case of a Lender which is a fund, to any
holders of obligations owed or securities issued by such Lender or any trustee
for or other representatives of such holders; provided that no such pledge or
assignment shall release such Lender from its obligations hereunder.  To facilitate any such pledge or assignment,
the Agent shall, at the request of such Lender, enter into a letter agreement
with the Federal Reserve Bank in, or substantially in, the form of the exhibit
to Appendix C to the Federal Reserve Bank of New York Operating Circular No.
12.

 

13.22.6            Anything in this
Agreement to the contrary notwithstanding, and subject to the requirement that
prior to the occurrence of an Event of Default, (x) KeyBank National
Association shall at all times hold not less than twenty-five percent (25%) of
the Lenders’ interest in the Loan and (y) KeyBank National Association’s
interest in the Loan shall at all times equal or exceed the interest of each
other Lender as provided in Section 13.22 hereof, any Lender may assign
all or any portion of its rights and obligations under this Agreement to
another branch or affiliate of such Lender without first obtaining the approval
of any Agent or the Borrower, provided that (i) such Lender remains liable
hereunder unless the Borrower and Agent shall otherwise agree, (ii) at the time
of such assignment such Lender is not a Defaulting Lender, (iii) such Lender
gives the Agent and Borrower at least fifteen (15) days’ prior written notice
of any such assignment; (iv) the parties to each such assignment execute and
deliver to Agent an Assignment and Assumption, and (v) the Agent receives from
the assigning Lender a processing fee of One Thousand Five Hundred Dollars
($1,500).

 

13.22.7            Each Lender shall have
the right, without the consent of the Borrower, to sell participations to one
or more Eligible Assignees, or an Affiliate or Related Fund of the assigning
Lender, in or to all or a portion of its rights and obligations under the Loan
and the Loan Documents; provided, however, that (i) such Lender’s obligations
under this Agreement (including without limitation its Commitment to Borrower
hereunder) shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
(iii) the Borrower, the Agent and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights
and obligations under this Agreement and with regard to any and all payments to
be made under this Agreement and (iv) the holder of any such participation

 

72

 

shall not be entitled to
voting rights under this Agreement or the other Loan Documents (but such holder
may contract with the Lender selling such Eligible Assignee its interest in
such Lender’s share of the Loan as to voting of such Lender’s interest under Section 13.26.2
but not under any other section of this Agreement, provided that any such
agreement by a Lender shall bind only such Lender alone and not Borrower, the
other Lenders or the Agent).

 

13.22.8            No Eligible Assignee
of any rights and obligations under this Agreement shall be permitted to subassign
such rights and obligations.  No
participant in any rights and obligations under this Agreement shall be
permitted to sell subparticipations of such rights and obligations.

 

13.22.9            Borrower acknowledges
and agrees that Lenders may provide to any assignee or participant originals or
copies of this Agreement, any other Loan Document and any other documents,
instruments, certificates, opinions, insurance policies, letters of credit,
reports, requisitions and other materials and information of every nature or
description, and may communicate all oral information, at any time submitted by
or on behalf of Borrower or received by any Lender in connection with the Loan
or with respect to Borrower, provided that prior to any such delivery or
communication, such Eligible Assignees or participants shall agree to preserve
the confidentiality of any of the foregoing to the same extent that such Lender
agreed to preserve such confidentiality. 
In order to facilitate assignments to Eligible Assignees and sales to
Eligible Assignees, Borrower shall execute such further documents, instruments
or agreements as Lenders may reasonably require; provided, that Borrower shall
not be required (i) to execute any document or agreement which would
materially decrease its rights, or materially increase its obligations,
relative to those set forth in this Agreement or any of the other Loan
Documents (including financial obligations, personal recourse, representations
and warranties and reporting requirements), or (ii) to expend more than
incidental sums of money or incidental administrative time for which it does
not receive reasonable reimbursement in order to comply with any requests or
requirements of any Lender in connection with such assignment or sale
arrangement.  In addition, Borrower
agrees to reasonably cooperate fully with Lenders in the exercise of Lenders’
rights pursuant to this Section, including providing such information and
documentation regarding Borrower as any Lender or any potential Eligible
Assignee may reasonably request and to meet with potential Eligible Assignees
in Borrower’s offices.

 

13.23                     Several Liability.  Anything contained in this Agreement to the
contrary notwithstanding, the obligations of each Lender to Borrower under this
Agreement are several and not joint and several; each Lender shall only be
obligated to fund its Percentage of each disbursement to be made hereunder up
to the amount of its Commitment.  Failure
of any Lender to fulfill its obligations hereunder shall not result in any
other Lender becoming obligated to advance more than its Commitment, nor shall
such failure release or diminish the obligations of any other Lender to fund
its Commitment provided herein.  During
any time, and only during such time, as Agent is the sole Lender and has not
assigned any portion or portions of its interest in the Loan to another Lender
pursuant to an Assignment and Assumption Agreement, Agent in its individual
capacity shall be liable for all of the obligations of the Lender under this
Agreement and the other Loan Documents. 
From and after the date that Agent as the sole Lender assigns any
portion or portions of its interest in the Loan to another Lender pursuant to
an

 

73

 

Assignment and Assumption Agreement, then Agent shall act as the
administrative agent on behalf of itself as a Lender and the other Lenders.

 

13.24                     Miscellaneous Assignment
Provisions.  Any assigning Lender
shall retain its rights to be indemnified pursuant to Section 7.20 with
respect to any claims or actions arising prior to the date of such
assignment.  If any assignee Lender is
not incorporated under the laws of the United States of America or any state
thereof, it shall prior to the date on which any interest or fees are payable hereunder
or under any of the other Loan Documents for its account, deliver to the
Borrower and the Agent certification as to its exemption from deduction or
withholding of any United States federal income taxes.

 

13.25                     Assignment by Borrower.  The Borrower shall not assign or transfer any
of its rights or obligations under any of the Loan Documents.

 

13.26                     Consents and Approvals.

 

13.26.1            Each of the following
shall require the approval or consent of the Required Lenders:

 

(a)                                  The
exercise by Agent and/or Lenders of any rights and remedies under the Loan
Documents following an Event of Default, provided that absent any direction
from the Required Lenders, Agent may exercise any right or remedy under the
Loan Documents as Agent may determine in good faith to be necessary or
appropriate to protect the Lenders or the collateral securing the Loan;

 

(b)                                 Appointment
of a successor Agent;

 

(c)                                  Approval
of Post-Default Plan (defined in Section 13.6.4); and

 

(d)                                 Except
as referred to in Section 13.26.2 below, approval of any amendment or
modification of this Agreement or any of the other Loan Documents, or issuance
of any waiver of any material provision of this Agreement or any of the other
Loan Documents;

 

13.26.2            Each of the following
shall require the approval or consent of all the Lenders:

 

(a)                                  Extension
of the Maturity (beyond any extension permitted herein) or forgiveness of all
or any portion of the principal amount of the Loan or any accrued interest
thereon, or any other amendment of this Agreement or the other Loan Documents
which would reduce the interest rate options or the rate at which fees are
calculated or forgive any loan fee, or extend the time of payment of any
principal, interest or fees;

 

(b)                                 Reduction
of the percentage specified in the definition of Required Lenders;

 

(c)                                  Increasing
the amount of the Loan or any non-consenting Lender’s Commitment;

 

74

 

(d)                                 Release
of any lien on any material collateral (except as Borrower is entitled to under
the Loan Documents);

 

(e)                                  The
release or forgiveness of any Guarantor;

 

(f)                                    Amendment
of the provisions of this Section 13.26;

 

(g)                                 Amendment
of the Mandatory Prepayment Events or the application of proceeds from such
events;

 

(h)                                 Modification
of Section 13.5.2 on the distribution of Liquidation Proceeds; and

 

(i)                                     Amendment
of what or how much is allowed as (i) Permitted Liens on the Individual
Properties or any other Collateral for the Loan, (ii) Permitted Debt or (iii)
Permitted Refinance.

 

13.26.3            In addition to the
required consents or approvals referred to in Sections 13.26.1 and 13.26.2
above, the Agent may at any time request instructions from the Required Lenders
with respect to any actions or approvals which, by the terms of this Agreement
or of any of the Loan Documents, the Agent is permitted or required to take or
to grant without instructions from any Lenders, and if such instructions are
promptly requested, the Agent shall be absolutely entitled to refrain from
taking any action or to withhold any approval and shall not be under any
liability whatsoever for refraining from taking any action or withholding any
approval under any of the Loan Documents until it shall have received such
instructions from the Required Lenders. 
Without limiting the foregoing, no Lender shall have any right of action
whatsoever against any Agent as a result of such Agent acting or refraining
from acting under this Agreement or any of the other Loan Documents in
accordance with the instructions of the Required Lenders or, where applicable,
all Lenders.  The Agent shall promptly
notify each Lender at any time that the Required Lenders have instructed the
Agent to act or refrain from acting pursuant hereto.

 

13.26.4            Each Lender authorizes
and directs the Agent to enter into the Loan Documents other than this
Agreement for the benefit of the Lenders. 
Each Lender agrees that any action taken by the Agent at the direction
or with the consent of the Required Lenders in accordance with the provisions
of this Agreement or any other Loan Document, and the exercise by the Agent at
the direction or with the consent of the Required Lenders of the powers set
forth herein or therein, together with such other powers as are reasonably
incidental thereto, shall be authorized and binding upon all Lenders, except
for actions specifically requiring the approval of all Lenders.  All communications from the Agent to the
Lenders requesting Lenders’ determination, consent, approval or disapproval (i)
shall be given in the form of a written notice to each Lender, (ii) shall be
accompanied by a description of the matter or item as to which such
determination, approval, consent or disapproval is requested, or shall advise
each Lender where such matter or item may be inspected, or shall otherwise
describe the matter or issue to be resolved, (iii) shall include, if reasonably
requested by a Lender and to the extent not previously provided to such Lender,
written materials and a summary of all oral information provided to the Agent
by Borrower in respect of the matter or issue to be

 

75

 

 

resolved, and (iv) shall
include the Agent’s recommended course of action or determination in respect
thereof.  Each Lender shall reply
promptly, but in any event within ten (10) Business Days after receipt of the
request therefor from the Agent (the “Lender Reply Period”).  Unless a Lender shall give written notice to
the Agent that it objects to the recommendation or determination of the Agent
(together with a written explanation of the reasons behind such objection)
within the Lender Reply Period, such Lender shall be deemed to have approved of
or consented to such recommendation or determination.  With respect to decisions requiring the
approval of the Required Lenders or all Lenders, the Agent shall upon receiving
the required approval or consent follow the course of action or determination
recommended to the Lenders by the Agent or such other course of action
recommended by the Required Lenders. 
Where this Loan Agreement or any other Loan Document requires that Borrower
deliver any documentation to Agent or any Lenders, the Borrower shall deliver
the same to Agent and Agent shall promptly deliver copies of the same to each
of the Lenders.

 

13.27                     Lead Arranger.  Notwithstanding the provisions of this
Agreement or of the other Loan Documents, the Lead Arranger shall have no
powers, rights, duties, responsibilities or liabilities with respect to this
Agreement and the other Loan Documents. 
To the extent requested by the Agent, the Lead Arranger has coordinated,
or will coordinate, the initial syndication of the Loan and the assignment of
interests in the Loan.

 

ARTICLE 14

 

GENERAL
PROVISIONS.

 

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

 

If to the Borrower:

 

FT-FIN ACQUISITION LLC

Two Jericho Plaza, Wing A, Suite 111

Jericho, New York 11753

Attention: Peter Braverman, Executive Vice President

FAX Number: (516) 433-2777

 

And

 

FT-FIN ACQUISITION LLC

7 Bulfinch Place, Suite 500, P.O. Box 9507

Boston, Massachusetts 02114

Attention: Carolyn Tiffany, Chief Operating Officer

FAX Number: (617) 570-4710

 

76

 

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

 

Post Heymann & Koffler LLP

Two Jericho Plaza, Wing A, Suite 111

Jericho, New York 11753

Attention: William W. Post, Esquire

FAX Number:                      (516) 433-2777

 

If to Agent:

 

KEYBANK NATIONAL ASSOCIATION

127 Public Square

Cleveland, Ohio 44114

Attention:

FAX Number:

 

And

 

KEYBANK NATIONAL ASSOCIATION

101 Federal Street

Boston, Massachusetts 02110

Attention: Mr. Jeffry M. Morrison

FAX Number: 617 204 5769

 

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

 

Riemer & Braunstein LLP

Three Center Plaza

Boston, Massachusetts 02108

Attention: Kevin J. Lyons, Esquire

FAX Number: (617) 880-3433

 

If to KEYBANK NATIONAL
ASSOCIATION:

 

KEYBANK NATIONAL ASSOCIATION

127 Public Square

Cleveland, Ohio 44114

Attention:

FAX Number:

 

And

 

KEYBANK NATIONAL ASSOCIATION

101 Federal Street

Boston, Massachusetts 02110

Attention: Mr. Jeffry M. Morrison

FAX Number: 617 204 5769

 

77

 

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

 

Riemer & Braunstein LLP

Three Center Plaza

Boston, Massachusetts 02108

Attention: Kevin J. Lyons, Esquire

FAX Number: (617) 692-3433

 

If
to the Co-Lender, to the addresses set forth on the signature page or to such
addresses as set forth in the Assignment and Acceptance.

 

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

 

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

 

14.2                           Limitations on Assignment.  The Borrower may not assign this Agreement or
the monies due thereunder without the prior written consent of all of the
Lenders in each instance, but in such event Lenders may nevertheless at their
option make the Loan under this Agreement to the Borrower or to those who
succeed to the title of the Borrower and all sums so advanced by Lenders shall
be deemed a Loan Advance under this Agreement and not to be modifications
thereof and shall be secured by all of the Collateral for the subject’s
Borrower’s Obligations given at any time in connection herewith.

 

14.3                           Further Assurances.  The Borrower shall upon request from Agent
from time to time execute, seal, acknowledge and deliver such further
instruments or documents which Agent may reasonably require to better perfect
and confirm its rights and remedies hereunder, under the Notes, under the
Security Documents and under each of the other Loan Documents.

 

14.4                           Payments.  All payments under the Note shall be applied
first to the payment of all fees, expenses and other amounts due to the Agent
(excluding principal and interest) and, to the extent reimbursement is provided
for herein, the Lenders, then to accrued interest, and the balance on account
of outstanding principal under the Note; provided, however, that after an Event
of Default, Liquidation Proceeds will be applied to the Obligations of the
Borrower to Agent and the Lenders as otherwise provided for herein.

 

14.5                           Parties Bound.  The provisions of this Agreement and of each
of the other Loan Documents shall be binding upon and inure to the benefit of
the Borrower, the Agent and each of the Lenders and their respective successors
and assigns, except as otherwise prohibited by this Agreement or any of the
other Loan Documents.

 

78

 

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

 

14.6                           Governing Law; Consent to
Jurisdiction; Mutual Waiver of Jury Trial.

 

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

 

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

 

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

 

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

 

14.6.5                  JURY TRIAL
WAIVER.  THE BORROWER, AGENT, AND
EACH OF THE LENDERS MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON THIS
LOAN AGREEMENT, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS LOAN AGREEMENT
OR ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH,
OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR
WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING, WITHOUT LIMITATION, ANY COURSE OF
CONDUCT, COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF AGENT OR ANY LENDER
RELATING TO THE ADMINISTRATION OF THE LOAN OR ENFORCEMENT OF THE LOAN
DOCUMENTS, AND AGREE THAT NEITHER PARTY WILL SEEK TO CONSOLIDATE ANY SUCH
ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN
WAIVED.  EXCEPT AS PROHIBITED BY LAW,
EACH PARTY HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY
LITIGATION ANY SPECIAL, INDIRECT, SPECULATIVE, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES.  THE BORROWER CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF AGENT OR ANY LENDER HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT AGENT OR ANY LENDER WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER.  THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT
FOR EACH OF THE PARTIES HERETO TO ENTER INTO THE TRANSACTIONS CONTEMPLATED HEREBY.

 

79

 

14.7                           Survival.  All representations, warranties, covenants
and agreements of the Borrower, or a Loan Party, herein or in any other Loan
Document, or in any notice, certificate, or other paper delivered by or on
behalf of the Borrower or a Loan Party pursuant hereto are significant and
shall be deemed to have been relied upon by Agent and each of the Lenders
notwithstanding any investigation made by Agent or any of the Lenders or on its
behalf and shall survive the delivery of the Loan Documents and the making of
the Loan pursuant thereto.  No review or
approval by Agent or the Lenders or any of their representatives, of any
opinion letters, certificates by professionals or other item of any nature shall
relieve the Borrower or anyone else of any of the obligations, warranties or
representations made by or on behalf of Borrower or a Loan Party, or any one or
more of them, under any one or more of the Loan Documents.

 

14.8                           Cumulative Rights.  All of the rights of Agent and the Lenders
hereunder and under each of the other Loan Documents and any other agreement
now or hereafter executed in connection herewith or therewith, shall be
cumulative and may be exercised singly, together, or in such combination as
Agent may determine in its sole good faith judgment.

 

14.9                           Claims Against Agent or
Lenders.

 

14.9.1                  Borrower Must
Notify.  The Agent and each of the
Lenders shall not be in default under this Agreement, or under any other Loan
Document, unless a written notice specifically setting forth the claim of the
Borrower shall have been given to Agent and each of the Lenders within thirty
(30) days after the subject Borrower first had actual Knowledge or actual
notice of the occurrence of the event which Borrower alleges gave rise to such
claim and Agent or any of the Lenders does not remedy or cure the default, if
any there be, with reasonable promptness thereafter.  Such actual Knowledge or actual notice shall
refer to what was actually known by, or expressed in a written notification
furnished to, any of the persons or officials referred to in Exhibit D
as Authorized Representatives.

 

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

 

14.9.3                  Limitations.  In no event, however, shall Agent and each of
the Lenders be liable to the Borrower or to any Loan Party or anyone else for
other damages such as, but not limited to, indirect, speculative, special,
exemplary, punitive or consequential damages whatever the nature of the breach
by Agent or any of the Lenders of its

 

80

 

obligations under this
Loan Agreement or under any of the other Loan Documents.  In no event shall Agent or any of the Lenders
be liable to the Borrower or to any Loan Party or anyone else unless a written
notice specifically setting forth the claim of the Borrower shall have been
given to Agent and each of the Lenders within the time period specified above.

 

14.10                     Regarding Consents.  Except to the extent expressly provided
herein, any and all consents to be made hereunder by the Agent, Required
Lenders, or Lenders shall be in the discretion of the Party to whom consent
rights are given hereunder.

 

14.11                     Obligations Absolute.  Except to the extent prohibited by applicable
law which cannot be waived, the Obligations of the Borrower and the obligations
of each Guarantor and the other Loan Parties under the Loan Documents shall be
joint and several, absolute, unconditional and irrevocable and shall be paid
strictly in accordance with the terms of the Loan Documents to which such Loan
Party is a party under all circumstances whatsoever, including, without
limitation, the existence of any claim, set off, defense or other right which
the Borrower or any Loan Party may have at any time against Agent or any of the
Lenders whether in connection with the Loan or any unrelated transaction.

 

14.12                     Table of Contents, Title and
Headings.  Any Table of Contents, the
titles and the headings of sections are not parts of this Loan Agreement or any
other Loan Document and shall not be deemed to affect the meaning or
construction of any of its or their provisions.

 

14.13                     Counterparts.  This Loan Agreement and each other Loan
Document may be executed in several counterparts, each of which when executed
and delivered is an original, but all of which together shall constitute one
instrument.  In making proof of this agreement,
it shall not be necessary to produce or account for more than one such
counterpart which is executed by the party against whom enforcement of such
loan agreement is sought.

 

14.14                     Satisfaction of Commitment.  The Loan being made pursuant to the terms
hereof and of the other Loan Documents is being made in satisfaction of Agent’s
and each of the Lenders’ obligations under the Commitment dated November    ,
2004.  The terms, provisions and
conditions of this Agreement and the other Loan Documents supersede the
provisions of the Commitment.

 

14.15                     Time Of the Essence.  Time is of the essence of each provision of
this Agreement and each other Loan Document.

 

14.16                     No Oral Change.  This Loan Agreement and each of the other
Loan Documents may only be amended, terminated, extended or otherwise modified
by a writing signed by the party against which enforcement is sought (except no
such writing shall be required for any party which, pursuant to a specific
provision of any Loan Document, is required to be bound by changes without such
party’s assent).  In no event shall any
oral agreements, promises, actions, inactions, knowledge, course of conduct,
course of dealings or the like be effective to amend, terminate, extend or
otherwise modify this Loan Agreement or any of the other Loan Documents.

 

14.17                     Monthly Statements.  While Agent may issue invoices or other
statements on a monthly or periodic basis (a “Statement”), it is expressly
acknowledged and agreed that: (i) the failure of Agent to issue any Statement
on one or more occasions shall not affect the Borrower’s

 

81

 

obligations to make payments under the Loan Documents as and when due;
(ii) the inaccuracy of any Statement shall not be binding upon Lenders and so
Borrower shall always remain obligated to pay the full amount(s) required under
the Loan Documents as and when due notwithstanding any provision to the
contrary contained in any Statement; (iii) all Statements are issued for
information purposes only and shall never constitute any type of offer,
acceptance, modification, or waiver of the Loan Documents or any of Lenders’
rights or remedies thereunder; and (iv) in no event shall any Statement serve
as the basis for, or a component of, any course of dealing, course of conduct,
or trade practice which would modify, alter, or otherwise affect the express
written terms of the Loan Documents.

 

ARTICLE 15

 

CASUALTY
AND TAKING

 

15.1                           Casualty or Taking;
Obligation To Repair  In the event of
the occurrence of a loss, casualty or taking as to any Mortgaged Property,
Borrower shall give immediate written notice thereof to Agent and proceed with
reasonable diligence, in full compliance with all Legal Requirements and the
other requirements of the Loan Documents, to repair, restore, rebuild or
replace the affected Mortgaged Property (each, the “Repair Work”).

 

15.2                           Adjustment of Claims  All insurance claims or condemnation or
similar awards shall be adjusted or settled by Borrower, at Borrower’s sole
cost and expense, but subject to Agent’s prior written approval for any
Mortgaged Property, which approval shall not be unreasonably withheld; provided
that (i) the Agent shall have the right to participate in any adjustment or
settlement for any Mortgaged Property with respect to which the Net Proceeds in
the aggregate are equal to or greater than Five Hundred Thousand Dollars
($500,000.00) and (ii) if any Event of Default exists under any of the Loan
Documents, Agent shall have the right to adjust, settle, and compromise such
claims without the approval of Borrower.

 

15.3                           Payment and Application
of Insurance Proceeds and Condemnation Awards. 

 

15.3.1                  Except as
otherwise provided for herein, all Net Proceeds shall be paid to Agent and, at
Agent’s option, be applied to Borrower’s Obligations or released, in whole or
in part, to pay for the actual cost of repair, restoration, rebuilding or
replacement (collectively, “Cost To Repair”). 
If any Net Proceeds are received directly by any Loan Party, such Loan
Party shall hold such Net Proceeds in trust for the Agent and shall promptly
deliver such Net Proceeds in kind to the Agent. 
..

 

15.3.2                  Notwithstanding
the terms and provisions hereof, with respect to any Mortgaged Property, if the
Net Proceeds do not exceed Five Hundred Thousand Dollars ($500,000.00),
provided no Default or Event of Default is then in existence, Agent shall
release the Net Proceeds to pay for the actual Cost to Repair and the
applicable Loan Party shall commence and diligently prosecute to completion,
the Repair Work relative to the subject Collateral Property, with any excess
being retained by the applicable Loan Party.

 

15.3.3                  Notwithstanding
the terms and provisions hereof, with respect to any Mortgaged Property, if the
Net Proceeds are equal to or greater than Five Hundred Thousand Dollars
($500,000.00), the Administrative Agent shall release so much of the

 

82

 

Net Proceeds as may be
required to pay for the actual Cost To Repair in accordance the limitations and
procedures set forth in Section 15.4, if the following conditions are
satisfied in a manner reasonably acceptable to the Agent:

 

(a)                                  no
Default or Event of Default shall have occurred and be continuing under the
Loan Documents;

 

(b)                                 in
Agent’s good faith judgment such Net Proceeds together with any additional
funds as may be deposited with and pledged to Agent, on behalf of the Lenders,
are sufficient to pay for the Cost To Repair. 
In order to make this determination, Agent shall be furnished by the
Borrower with an estimate of the Cost to Repair accompanied by an independent
architect’s or engineer’s certification as to such Cost to Repair and
appropriate plans and specifications for the Repair Work;

 

(c)                                  in
Agent’s good faith judgment, the Repair Work can reasonably be completed on or
before the time required under applicable Legal Requirements; and

 

(d)                                 the
Lease with respect to the Mortgaged Property shall remain in full force and
effect and shall require the repair and reconstruction of the Mortgaged Property.

 

15.4                           Conditions To Release of
Insurance Proceeds.  If Agent elects
or is required to release insurance proceeds, Agent may impose reasonable
conditions on such release which shall include, but not be limited to, the
following:

 

15.4.1                  Prior written
approval by Agent, which approval shall not be unreasonably withheld or delayed
of plans, specifications, cost estimates, contracts and bonds for the Repair
Work;

 

15.4.2                  Waivers of lien,
architect’s and/or engineer’s certificates, and other evidence of costs,
payments and completion as Agent may reasonably require;

 

15.4.3                  The funds shall
be released upon final completion of the Repair Work, unless Borrower requests
earlier funding, in which event partial monthly disbursements equal to 90% of
the costs of the work completed prior to the certification by the applicable
Lender’s Consultant and if there is no Lender’s Consultant, an independent
architect or engineer retained by the Borrower, that the Repair Work is
completed, and then upon final completion of the Repair Work as certified by
such Lender’s Consultant or independent architect or engineer, and the receipt
by Agent of satisfactory evidence of payment and release of all liens, the
balance of the funds shall be released;

 

15.4.4                  Determination by
Agent that the undisbursed balance of such Net Proceeds on deposit with Agent,
together with additional funds deposited for the purpose, shall be at least
sufficient to pay for the remaining Cost To Repair, free and clear of all liens
and claims for lien;

 

83

 

15.4.5                  All work to
comply with the Legal Requirements applicable to the construction of the
Improvements; and

 

15.4.6                  The absence of
any Default under any Loan Documents.

 

15.5                           Consultant.  The Agent shall have the right to hire, at
the cost and expense of the Borrower, a Lender’s Consultant to assist the Agent
in the determination of the satisfaction of the conditions provided for herein
for the release of the Net Proceeds, to pay the Costs to Repair and to
periodically inspect the status of the construction of any Repair Work.

 

15.6                           Excess.  In the event that the Agent makes any Net
Proceeds available to any Loan Party for the payment of Costs to Repair as
provided for herein, upon the completion of the Repair Work as certified by the
applicable Lender’s Consultant and if there is no Lender’s Consultant, an
independent architect or engineer retained by the Borrower, and receipt by
Agent of satisfactory evidence of payment and release of all liens, any excess
Net Proceeds still held by the Agent shall be remitted by the Agent to the
Borrower provided that no Event of Default shall have occurred and be
continuing.

 

15.7                           Leases.  The terms and provisions of this Article 15
shall be subject to the terms and provisions of any Lease which remains in full
force and effect under which the repair or reconstruction of the Mortgaged
Property is required under the First Mortgage Debt.

 

84

 

IN WITNESS
WHEREOF this Agreement has been duly executed and delivered as a sealed
instrument at Boston, Massachusetts, as of the date first written above.

 

	
  BORROWER:

  	
   

  	
  FT-FIN ACQUISITION LLC, a Delaware limited

  liability company

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  PARK PLAZA MALL, LLC, its sole

  member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  FIRST UNION REAL ESTATE

  EQUITY AND MORTGAGE

  INVESTMENTS, its sole member

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Carolyn Tiffany

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Operating Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  AGENT:

  	
   

  	
  KEYBANK NATIONAL ASSOCIATION,

  a national banking association

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Jeffry M. Morrison

  
	
   

  	
   

  	
   

  	
  Duly Authorized

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  LENDER:

  	
   

  	
  KEYBANK NATIONAL ASSOCIATION,

  a national banking association

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Jeffry M. Morrison

  
	
   

  	
   

  	
   

  	
  Duly Authorized

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  NEWSTAR CP FUNDING LLC, a Delaware

  limited liability company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  NEWSTAR FINANCIAL, INC., its

  designated manager

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
										

 

S1

 

EXHIBITS:

 

 

	
   

  	
  Section

  Reference

  Number

  
	
   

  	
   

  
	
  Exhibit A -
  Definitions

  	
  1.1

  
	
  Exhibit B -
  Use of Proceeds

  	
   

  
	
  Exhibit C -
  Notes

  	
   

  
	
  Exhibit D -
  Authorized Representatives

  	
  4

  
	
  Exhibit E -
  Required Property, Hazard and Other Insurance

  	
  5.1.13, 5.2.11, 6.1.20, 6.2.17, 7.1.5,
  7.2.5

  
	
  Exhibit F -
  Ownership Interests and Taxpayer Identification Numbers

  	
  6.4(a)

  
	
  Exhibit G-1
  Compliance Certificate the Borrower

  	
  7.1.2(i)(d)

  
	
  Exhibit G-2
  - Financial Covenant Compliance Certificate.

  	
  7.2.1(c)

  
	
  Exhibit H -
  Form of Assignment and Acceptance

  	
   

  
	
  Exhibit I -
  Lenders’ Commitments

  	
  Exhibit A

  
	
  Exhibit J -
  Individual Properties

  	
  Exhibit A

  
	
  Exhibit K -
  Loan Agenda

  	
  Exhibit A

  
	
  Exhibit M -
  the Borrower Partnerships and Borrower LLCs

  	
  Exhibit A

  
	
  Exhibit P -
  Cash Flow Projections

  	
  Exhibit A

  
	
  Exhibit R -
  Accounts

  	
  7.14

  
	
  Exhibit ALA
  - Allocated Loan Amount

  	
   

  

 

 

EXHIBIT A TO LOAN AGREEMENT

DEFINITIONS

 

Accounts shall mean, collectively, the Depository Accounts.

 

Acquisition  as defined in Section 1.3.

 

Adjusted
LIBOR Rate:  For any LIBOR Rate Interest Period, an
interest rate per annum equal to the sum of (A) the rate obtained by dividing
(x) the LIBOR Rate for such LIBOR Rate Interest Period by (y) a percentage
equal to one hundred percent (100%) minus the Reserve Percentage for such LIBOR
Rate Interest Period and (B) the LIBOR Rate Margin.

 

Adjusted
LIBOR Rate Advance.  The term “Adjusted LIBOR Rate Advance” means
any principal outstanding under this Agreement which pursuant to this Agreement
bears interest at the Adjusted LIBOR Rate.

 

Adjusted
Prime Rate:  A rate per annum equal to the sum of (a) the
Prime Rate Margin and (b) the greater of (i) the Prime Rate or (ii) one percent
(1%) in excess of the Federal Funds Effective Rate.  Any change in the Adjusted Prime Rate shall
be effective immediately from and after a change in the Adjusted Prime Rate (or
the Federal Funds Effective Rate, as applicable).

 

Adjusted
Prime Rate Advance.  The term “Adjusted Prime Rate Advance” means
any principal amount outstanding under this Agreement which pursuant to this
Agreement bears interest at the Adjusted Prime Rate.

 

Affiliate shall mean, as to any Person, any other Person that,
directly or indirectly, is in control of, is controlled by or is under common
control with such Person or is a director or officer of such Person.  For purposes of this definition, control of a
Person shall mean the power, direct or indirect, (i) to vote 10% or more of the
securities having ordinary voting power for the election of directors of such
Person or (ii) to direct or cause the direction of the management and policies
of such Person, whether by contract or otherwise.

 

Agent.  KEYBANK NATIONAL
ASSOCIATION, acting as agent for the Lenders.

 

Aggregate
Investment Capitalization shall
mean, with respect to the Borrower’s Investments, the value of the non-real estate assets, as calculated by
the Borrower and approved by the Agent in its reasonable discretion, plus the
value of the underlying real estate assets. 
The underlying real estate assets will be valued based upon a 10 year
discounted Cash Flow.  The discount rate
will be 9% and the reversionary capitalization rate will be 11%.  The Cash Flow will be based upon (a) in place
rental income through the expiration of the primary term of the lease, and (b)
at primary term maturity of a given lease, (i) the lease rate will be the
renewal lease rate if the renewal rent is less than Market Rent, and (ii) if
the renewal rate is greater than the Market Rent, the post primary term income
stream will be based on the Market Rent based upon the following assumptions:
(1) the renewal probability of the tenant remaining at lease expiration is 65%,
(2)  the downtime at expiration is estimated to be
nine (9) months, (3) the Market Rent is assumed to grow at 0% per year from the
analysis made at the Closing Date, and (4) the rent employed for these spaces
is the Market Rent, regardless as to the rate in the renewal option, all of the
foregoing as determined solely by the Agent.

 

 

Agreement as defined in the Preamble.

 

Allocated
Loan Amount shall mean,
for each Individual Property, the amount set forth in Exhibit ALA.

 

Applicable
Rate: 
As such term is defined in Section 2.4.1.

 

Appraisal as defined in Section 7.19.

 

Arranger shall mean KEYBANC CAPITAL MARKETS.

 

Authorized
Representatives as defined
in Section 4.1 and listed on Exhibit D.

 

Borrower as defined in the Preamble.

 

Borrower
LLCs 
shall mean, singly and collectively, from time to time, those limited
liability companies which are wholly-owned and controlled by the Borrower,
including, without limitation, those listed on Exhibit M.

 

Borrower
Partnerships  shall mean, singly and collectively, from time
to time, those limited partnerships whose limited partnership interests are
wholly-owned and controlled by the Borrower and whose sole general partner is
FT-FIN GP, including, without limitation, those listed on Exhibit M.

 

Borrower
Subsidiaries shall mean
all of the Subsidiaries of the Borrower, and all Subsidiaries of Subsidiaries
of the Borrower, including, without limitation, the Borrower Partnerships and
the Borrower LLCs, as listed on Exhibit M.

 

Breakage
Costs: 
(a) The cost to Lender of re-employing funds bearing interest at an
Adjusted LIBOR Rate, incurred (or expected to be incurred) in connection with
(i) any payment of any portion of the Loan bearing interest at an Adjusted
LIBOR Rate prior to the termination of any applicable LIBOR Rate Interest
Period, (ii) the conversion of an Adjusted LIBOR Rate to any other
applicable interest rate on a date other than the last day of the relevant
LIBOR Rate Interest Period, or (iii) the failure of Borrower to draw down,
on the first day of the applicable LIBOR Rate Interest Period, any amount as to
which Borrower has elected a LIBOR Rate Option and (b) any amounts payable
by Borrower under any Interest Rate Agreement in connection with termination of
such Agreement.

 

Business
Day shall mean any day of the year
on which offices of Agent are not required or authorized by law to be closed
for business in Boston, Massachusetts. 
If any day on which a payment is due is not a Business Day, then the
payment shall be due on the next day following which is a Business Day, and
such extension of time shall be included in computing interest and fees in
connection with such payment.  Further,
if there is no corresponding day for a payment in the given calendar month
(i.e., there is no “February 30th”), the payment shall be due on the last
Business Day of the calendar month.

 

Calculation
Date as defined in Section 7.28.1(a)(i).

 

Calculation
Period as defined in Section 7.28.1(a)(ii).

 

 

Cash
Flow shall mean, in each calendar
year, in each instance determined in a manner satisfactory to the Agent, the
aggregate sum of (i) all revenues and cash receipts of the Borrower
Subsidiaries less (ii) the sum of the Borrower Subsidiaries’ (a) property level
operating expenses including but not limited to ground rent, (b) management fees
and (c) administrative fees.

 

Cash
Flow Projections shall mean a
detailed schedule of all cash Distributions projected to be made to the
Borrower and FT-FIN GP from the Borrower Subsidiaries within the next one
hundred and eight (180) days, as detailed on Exhibit P, being the Cash
Flow Projections as of the Closing Date based upon information then available
to the Borrower, and subject to change as shall be detailed in the respective
Officer’s Certificate to be provided to the Agent as set forth herein.

 

Cash
Management Agreement one or more
cash management agreements to be entered into pursuant to Article 7.

 

Change
of Control shall mean
the occurrence of any of the following, as determined solely by the Agent (for
purposes of this definition, ownership of interests in a Borrower that are
subject to a Lien permitted under the Security Documents shall be deemed
beneficially owned by the pledgor thereof):

 

1.                                       A change in the
identity of any general partner, managing member, and/or any material change in
the effective control of any general partner or managing member of any Loan
Parties (other than the Borrower) and/or any Borrower Subsidiary, such that
effective control is not in the Borrower (except as to any change in the
effective control of any Loan Party which is released as provided for herein
from its obligations under the Loan Documents);

 

2.                                       Except as
provided in Section 8.3.8, a change in the identity of the member of the
Borrower and the partners of FT-FIN GP and/or any material change in the effective
control of the member of the Borrower, from the identity and control structure
existing as of the Funding Date;

 

3.                                       A change in the
identity of any general partner, managing member, and/or effective control of
any general partner or managing member of any Loan Parties which is a Loan
Party, such that effective control is not in any other Loan Party; or

 

4.                                       The death or
disability of both of Michael Ashner and Peter Braverman, or the failure of
both of Michael Ashner and Peter Braverman, at any time to exercise that
authority and discharge those management responsibilities with respect to the
Borrower as are exercised and discharged by such Person at the execution of
this Agreement; provided, however, the death or disability of both Michael
Ashner and Peter Braverman shall not be a default hereunder if within thirty
(30) days of the death or disability of the second to die or become disabled,
the Borrower provides the Agent with evidence satisfactory to the Agent of
acceptable replacement or substitute management of the Borrower and their
respective Subsidiaries.

 

Churchill
Owner shall mean FT-Churchill
Property L.P., a Delaware limited partnership.

 

 

Churchill
Property shall mean
the Individual Property located at 1310 Beulah Road, Churchill, Pennsylvania,
ground leased by the Churchill Owner.

 

Closing
Date as defined in Section Article 5.

 

Code shall mean the Internal Revenue Code of 1986, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder.  Section references to
the Code are to the Code, as in effect at the date of this Agreement and any
subsequent provisions of the Code, amendatory thereof, supplemental thereto or
substituted therefor.

 

Collateral. as defined in Section 3.1.

 

Commitment shall mean, with respect to each Lender, the amount set
forth on Exhibit I hereto as the amount of such Lender’s commitment to
make advances to the Borrower, as may be amended from time to time by the Agent
as provided in Article 13.

 

Consents as defined in Section 5.4.

 

Consolidated
Debt Service as defined
in Section 7.28.1(a)(viii).

 

Consolidated
Debt Service Coverage as
defined in Section 7.28.1(a)(vi).

 

Consolidated
Leverage Ratio as defined
in Section.7.28.2.

 

Consolidated
Net Cash Flow as defined
in Section 7.28.1(a)(vii).

 

Debt  shall mean, with
respect to any Person, without duplication, (i) all indebtedness of such Person
for borrowed money, (ii) all indebtedness of such Person for the deferred
purchase price of property or services (other than property and services purchased,
and expense accruals and deferred compensation items arising, in the ordinary
course of business), (iii) all obligations of such Person evidenced by notes,
bonds, debentures or other similar instruments (other than performance, surety
and appeal bonds arising in the ordinary course of business), (iv) all
indebtedness of such Person created or arising under any conditional sale or
other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property), (v) all obligations of such Person under leases which have been, or
should be, in accordance with generally accepted Accounting principles,
recorded as capital leases, to the extent required to be so recorded, (vi) all
reimbursement, payment or similar obligations of such Person, contingent or
otherwise, under acceptance, letter of credit or similar facilities (other than
letters of credit in support of trade obligations or in connection with workers’
compensation, unemployment insurance, old-age pensions and other social
security benefits in the ordinary course of business), (vii) all Debt in the
nature of that referred to in clauses (i) through (vi) above which is
guaranteed directly or indirectly by such Person, or in effect guaranteed
directly or indirectly by such Person through an agreement (A) to pay or
purchase such Debt or to advance or supply funds for the payment or purchase of
such Debt, (B) to purchase, sell or lease (as lessee or lessor) property, or to
purchase or sell services, primarily for the purpose of enabling the debtor to
make payment of such Debt or to assure the holder of such Debt against loss in
respect of such Debt, (C) to supply funds to or in any other manner invest in
the debtor (including any agreement to pay for property or services
irrespective of whether such property is received or

 

 

such
services are rendered) or (D) otherwise to assure a creditor against loss in
respect of such Debt, (viii) any obligation, contingent or otherwise, of such
Person guaranteeing or having the economic effect of guaranteeing any
indebtedness referred to in clause (i) through (iv) above of any Person, either
directly or indirectly, and (ix) all Debt referred to in clauses (i) through
(vi) above secured by (or for which the holder of such Debt has an existing
right, contingent or otherwise, to be secured by) any Lien, security interest
or other charge or encumbrance upon or in property (including, without
limitation, accounts and contract rights) owned by such Person, even though
such Person has not assumed or become liable for the payment of such Debt.

 

Debt
Service as defined in Section 7.28.1(a)(iii).

 

Debt
Service Coverage as defined
in Section 7.28.1(a)(iv).

 

Default as defined in Section 10.1.

 

Defaulting
Lender:  As such
term is defined in Section 13.5.3.

 

Default
Rate as defined in Section 2.5.5.

 

Depository
Account Pledge and Security Agreement
as defined in Section 3.1.4.

 

Depository
Accounts  as defined in Section 3.1.4.

 

Distribution shall mean, with respect to any Person, that such Person
has paid a dividend or returned any equity capital to its stockholders, members
or partners or made any other distribution, payment or delivery of property
(other than common stock or partnership or membership interests of such Person)
or cash to its stockholders, members or partners as such, or redeemed, retired,
purchased or otherwise acquired, directly or indirectly, for a consideration
any shares of any class of its capital stock or any membership or partnership
interests (or any options or warrants issued by such Person with respect to its
capital stock or membership or partnership interests), or shall have permitted
any of its Subsidiaries to purchase or otherwise acquire for a consideration
any shares of any class of the capital stock or any membership or partnership
interests of such Person (or any options or warrants issued by such Person with
respect to its capital stock or membership or partnership interests). Without
limiting the foregoing, “Distributions” with respect to any Person shall also
include all payments made by such Person with respect to any stock appreciation
rights, plans, equity incentive or achievement plans or any similar plans, and
any proceeds of a dissolution or liquidation of such Person.

 

Dollars shall mean lawful money of the United States.

 

Economic
Discontinuance Rights shall
mean the right of a tenant under a Lease relative to any Individual Property to
terminate the Lease prior to the expiration of the primary term of the Lease by
making a Rejectable Offer to the applicable Property Owner, all of the
foregoing as and when provided for in the Lease relative to such Individual
Property.  If the Rejectable Offer is
accepted by the Property Owner, the Individual Property is to be sold to the
said tenant for the amount as set forth in the Lease.  If the Rejectable Offer is rejected by the
Property Owner, the Lease terminates as set forth in the Lease.

 

 

Economic
Discontinuance Sale shall mean
the sale of an Individual Property to a tenant upon the acceptance of a
Rejectable Offer by the applicable Property Owner.

 

ED
Cash Flow as defined
in Section 7.23.6.

 

ED
Properties shall mean
all Individual Properties as to which a Property Owner has rejected the
Rejectable Offer made by a tenant pursuant to the tenant’s exercise of its
Economic Discontinuance Rights.  An
Individual Property shall no longer be considered an ED Property at such time
as such Individual Property evidences a minimum ratio of cash flow to debt
service (as determined by the Agent based solely on revenues and debt service
of such Individual Property based on leases executed in accordance with the
requirements of Section 7.21), of no less than 1.30 to 1.0.  The value and income from all ED Properties
will be excluded when calculating compliance (or pro forma compliance, as
applicable) with the Financial Covenants in any instance, until such time as
the Borrower shall have executed (a) a binding, arms length purchase and sale
agreement with respect to such ED Property, or ( b) a Lease in accordance with
the provisions of Section 7.21 hereof.

 

Eligible
Assignee:  (i) Any Lender; (ii) any commercial bank,
savings bank, savings and loan association or similar financial institution
which (A) has total assets of One Billion Dollars ($1,000,000,000) or more, (B)
is “well capitalized” within the meaning of such term under the regulations
promulgated under the auspices of the Federal Deposit Insurance Corporation
Improvement Act of 1991, (C) in the sole judgment of the Agent, is engaged in
the business of lending money and extending credit, and buying loans or
participations in loans under credit facilities substantially similar to those
extended under this Agreement, and (D) in the reasonable judgment of the Agent,
is operationally and procedurally able to meet the obligations of a Lender
hereunder to the same degree as a commercial bank; (iii) any insurance company
in the business of writing insurance which (A) has total assets of One Billion
Dollars ($1,000,000,000) or more (B) is “best capitalized” within the meaning
of such term under the applicable regulations of the National Association of
Insurance Commissioners, and (C) meets the requirements set forth in subclauses
(C) and (D) of clause (ii) above; and (iv) any other financial institution
having total assets of One Billion Dollars ($1,000,000,000)  (including a mutual fund or other fund under
management of any investment manager having under its management total assets
of One Billion Dollars ($1,000,000,000) or more) which meets the requirement
set forth in subclauses (C) and (D) of clause (ii) above; provided that each
Eligible Assignee must (w) be organized under the Laws of the United States of
America, any state thereof or the District of Columbia, or, if a commercial
bank, be organized under the Laws of the United States of America, any state
thereof or the District of Columbia, 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, (x) act under the Loan Documents
through a branch, agency or funding office located in the United States of
America, (y) be exempt from withholding of tax on interest and deliver the
documents related thereto pursuant to the Internal Revenue Code as in effect
from time to time and (z) not be the Borrower or an Affiliate of the Borrower.

 

Environmental
Indemnity as defined
in Section 3.1.8.

 

Environmental
Laws as defined in the Environmental
Indemnity.

 

ERISA shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.  Section references

 

 

to
ERISA are to ERISA, as in effect at the date of this Agreement and any
subsequent provisions of ERISA, amendatory thereof, supplemental thereto or
substituted therefor.

 

ERISA
Affiliate shall mean
each person (as defined in Section 3(9) of ERISA) which together with the
Borrower or a Subsidiary of a Borrower would be deemed to be a “single employer”  within the meaning of Section 414(b),
(c), (m) or (o) of the Code.

 

Escrow
Agreement Respecting Ground Lease Extensions and Lease Options as defined in Section 3.1.10.

 

Escrow
Agreement Respecting Mortgage as defined in Section 3.1.9.

 

Event
of Default as defined
in Section 10.1.

 

Extended
Maturity Date as defined
in Section 2.2.

 

Extended
Term as defined in Section 2.2.

 

Extension
Fee as defined in Section 2.6.

 

Federal
Funds Effective Rate:  Shall mean, for any day, the rate per annum
(rounded upward to the nearest on one-hundredth of one percent (1/100 of 1%))
announced by the Federal Reserve Bank 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 Bank in substantially the same manner as such Federal
Reserve Bank computes and announces the weighted average it refers to as the “Federal
Funds Effective Rate.”

 

Financial
Covenants  shall mean those covenants of the Borrower
set forth in Section 7.28.

 

First
Extended Maturity Date as
defined in Section 2.2.

 

First
Extended Term as defined
in Section 2.2.

 

First
Mortgage Debt shall mean,
from time to time, any obligations of a Property Owner secured by a first
mortgage or first deed of trust on one or more Individual Properties, as of the
Closing Date as set forth in Schedule 6.17.2.

 

First
Union shall mean First Union Real
Estate Equity and Mortgage Investments, an Ohio business trust.

 

Fiscal
Year shall mean each twelve month
period commencing on January 1 and ending on December 31.

 

Formation
Documents shall mean,
singly and collectively, the partnership agreements, joint venture agreements,
limited partnership agreements, limited liability company or operating
agreements and certificates of limited partnership and certificates of
formation, articles (or certificate) of incorporation and by-laws and any
similar agreement, document or instrument of any Person.

 

 

Free
Cash Flow shall mean
for any four (4) fiscal quarters of the Borrower the Net Cash Flow for such
period less (i) the Debt Service for such period.

 

FT-FIN
GP shall mean FT-FIN GP LLC, a
Delaware limited liability company, being the sole general partner of each
Borrower Partnership.

 

Funding
Date as defined in Section 0.

 

GAAP shall mean generally accepted Accounting principles in the
United States of America as of the date applicable.

 

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

 

Ground
Leases shall mean, from time to time,
any Ground Lease relative to an Individual Property as to which a Property
Owner is the ground lessee, including, without limitation, any ground lease
which shall be entered into in connection with the exercise by an Property
Owner of a Remainder Ground Lease Option.

 

Ground
Lease Extension Options as
defined in Section 3.1.10(a).

 

Ground
Lease Extension Option Schedule as
defined in Section 6.17.6

 

Guaranty as defined in Section 3.1.7.

 

Guarantor as defined in Section 1.4.

 

Hazardous
Materials shall mean
and include asbestos, flammable materials, explosives, radioactive substances,
polychlorinated biphenyls, radioactive substances, other carcinogens, oil and
other petroleum products, pollutants or contaminants that could be a detriment
to the environment, and any other hazardous or toxic materials, wastes, or
substances which are defined, determined or identified as such in any past,
present or future federal, state or local laws, rules, codes or regulations, or
any judicial or administrative interpretation of such laws, rules, codes or
regulations.

 

Indemnified
Party as defined in Sections 7.20.

 

Indemnitor as defined in Section 3.1.8.

 

Independent shall mean, when used with respect to any Person, a Person
who (i) is in fact independent, (ii) does not have any direct financial or
indirect financial interest (other than amounts payable to such Person for
serving as a director) in the Borrower, any Borrower Subsidiary, or any Loan
Party or in any Affiliate of any thereof or in any constituent partner or member
of the Borrower, any Borrower Subsidiary, or any Loan Party or any Affiliate of
any thereof and (iii)  is not connected
with the Borrower, any Borrower Subsidiary, or any Loan Party or any Affiliate
thereof or any constituent partner of the Borrower, any Borrower Subsidiary, or
any Loan Party or any Affiliate of any thereof as an officer, employee,
promoter, underwriter, trustee, partner, director, or person performing similar
functions.  Any such Person shall not be
deemed to fail to comply with the requirements of clause (iii), above, solely
due to

 

 

such
Person serving as an Independent director of First Union.  Whenever it is herein provided that any
Independent Person’s opinion or certificate shall be provided, such opinion or
certificate shall state that the Person executing the same has read this
definition and is Independent within the meaning hereof.

 

Individual
Property and Individual
Properties shall mean, from time to time, with respect to each Property
Owner, each real estate property owned by such entity, together with all
improvements, fixtures, equipment, and personalty relating to such property,
with the Individual Properties as of the date hereof being listed on Exhibit
J hereto.

 

Initial
Advance 
as defined in Section 2.1.2(a).

 

Initial
Term as defined in Section 2.2.

 

Interest
Rate Agreement:  An Interest Rate Protection Product purchased
by Borrower from Agent.

 

Interest
Rate Protection Product:  An interest rate hedging product, such as a
cap or swap.

 

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

 

Knowledge shall mean with respect to the Borrower and any of their
respective Subsidiaries, the knowledge of any of Michael Ashner, Peter
Braverman, Thomas Staples, Carolyn Tiffany, or Jay Cramer, or any Person who
shall at any time replace any of the foregoing.

 

Late
Charge as defined in Section 2.5.6.

 

Lease shall mean any lease relative to all or any portion of an
Individual Property.

 

Lease
Schedule as defined in
Section 6.17.5.

 

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

 

Lenders as defined in the Preamble.

 

Lender
Default Obligation:  As such term is defined in Section 13.5.3.

 

Lender
Reply Period:  As such term is defined in Section 13.26.

 

 

LIBOR
Business Day:  A Business Day on which dealings in U.S.
dollars are carried on in the London Interbank Market.

 

LIBOR
Rate:  For any LIBOR Rate Interest Period, the
average rate (rounded upwards to the nearest 1/16th) as shown in Dow
Jones Markets (formerly Telerate) (Page 3750) at which deposits in U.S.
dollars are offered by first class banks in the London Interbank Market at
approximately 11:00 a.m. (London time) on the day that is two (2) LIBOR
Business Days prior to the first day of such LIBOR Rate Interest Period with a maturity
approximately equal to such LIBOR Rate Interest Period and in an amount
approximately equal to the amount to which such LIBOR Rate Interest Period
relates, adjusted for reserves and taxes if required by future regulations.  If Dow Jones Markets no longer reports such
rate or Agent determines in good faith that the rate so reported no longer
accurately reflects the rate available to Agent in the London Interbank Market,
Lender may select a replacement index.

 

LIBOR
Rate Interest Period:  With respect to each amount bearing interest
at a LIBOR based rate, a period of one (1), two (2), three (3), or six (6)
months, to the extent deposits with such maturities are available to Agent,
commencing on a LIBOR Business Day, as selected by Borrower provided, however,
that (i) any LIBOR Rate Interest Period which would otherwise end on a day
which is not a LIBOR Business Day shall continue to and end on the next
succeeding LIBOR Business Day, unless the result would be that such LIBOR Rate
Interest Period would be extended to the next succeeding calendar month, in
which case such LIBOR Rate Interest Period shall end on the next preceding
LIBOR Business Day, (ii) any LIBOR Rate Interest Period which begins on a day
for which there is no numerically corresponding date in the calendar month in
which such LIBOR Rate Interest Period would otherwise end shall instead end on
the last LIBOR Business Day of such calendar month, and (iii) Borrower may not
select a LIBOR Rate Interest Period which would end after the Maturity Date..

 

LIBOR
Rate Margin:   Four and one half (4.50%) percent
(450 basis points) per annum.

 

LIBOR
Rate Option:  As defined in Section 2.4.

 

Lien shall mean any mortgage, deed of trust, lien, pledge,
hypothecation, assignment, security interest, or any other encumbrance, charge
or transfer, including, without limitation, any conditional sale or other title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing, and mechanic’s, materialmen’s and other similar
liens and encumbrances.

 

Licenses
and Permits shall mean
all licenses, permits, authorizations and agreements issued by or agreed to by
any governmental authority, including, but not limited to, building permits,
occupancy permits and such special permits, variances and other relief as may
be required pursuant to Legal Requirements which may be applicable to the
Individual Property.

 

Liquid
Assets shall mean the sum of the
following unencumbered (other than by Liens held by the Agent on behalf of the
Lenders) assets: (i) all cash (denominated in United States dollars), (ii) any
demand deposits, (iii) marketable securities consisting of short-term (maturity
of one year or less) obligations issued or guaranteed as to principal and
interest by the United States of America, (iv) short-term certificates of
deposit, with a maturity of one year or less, issued by any bank organized
under the laws of the United States of America having total assets in excess of

 

 

$1,000,000,000.00,
and (v) any other securities acceptable to the Agent as evidenced by the Agent’s
written approval.

 

Liquidation
Proceeds. Amounts
received by the Agent and/or the Lenders in the exercise of the rights and
remedies under the Loan Documents (including, but not limited to, all rents,
profits and other proceeds received by the Agent and/or the Lenders from the
liquidation of, or exercising rights upon the occurrence of an Event of Default
relative to, any Collateral, but not including any amount bid at a foreclosure
sale or on behalf of the Agent or otherwise credited to a Borrower in, any
deed-in-lieu of foreclosure or similar transaction).

 

Loan as defined in Section 1.3.

 

Loan
Advance 
each advance of proceeds of the Loan hereunder.

 

Loan
Agenda shall mean that Document Agenda
respecting the establishment of the Loan annexed hereto as Exhibit K.

 

Loan
Agreement as defined
in the Preamble.

 

Loan
Documents as defined
in Section 3.1.

 

Loan
Party and Loan Parties shall
mean, singly and collectively, the Borrower, FT-FIN GP, and the Borrower
Subsidiaries.

 

Mandatory
Prepayment Event as defined
in Section 2.5.

 

Mandatory
Principal Prepayments as
defined in Section 2.5.1(b).

 

Market
Rent shall mean, at any point of
determination, then current rentals being charged to new tenants for comparable
quality space located on comparable quality property within the subject
geographic area of the subject Individual Property, taking into account and
giving effect to, without limitation, such considerations as size, location of
the Individual Property, lease term and level and quality of building
construction and space improvements, tenant allowances, and rent concessions,
all as reasonably determined by the Agent.

 

Material
Adverse Effect shall mean a
material adverse effect on, determined separately with respect to the Borrower,
(i) the business, assets, prospects, operations or financial or other condition
of any of the Borrower and/or, taken as a whole, any of the other Loan Parties,
including, without limitation, all Distributions to be made pursuant to Cash
Flow Projections (ii) the ability of Borrower, the Borrower Subsidiaries,
and/or the other Loan Parties to perform any material Obligations or to pay any
Obligations which it is obligated to pay in accordance with the terms hereof or
of any other Loan Document, (iii) the rights of, or benefits available to, the
Agent and/or any of the Lenders under any Loan Document or (iv) any Lien given
to Agent and/or any of the Lenders on any material portion of the Collateral or
the priority of any such Lien.

 

Maturity shall mean the Maturity Date, or, if the Maturity Date has
been extended pursuant to the provisions of the Loan Agreement, the applicable
Extended Maturity Date, or in any instance, upon acceleration of the Loan, if
the Loan has been accelerated by Lenders upon an Event of Default.

 

 

Maturity
Date as defined in Section 2.2.

 

Minimum
Consolidated Net Worth as
defined in Section 7.28.4.

 

Mortgage
Debt shall mean, singly and
collectively, the First Mortgage Debt.

 

Mortgage
Debt Schedule as defined in
Section 6.17.8.

 

Mortgaged
Property shall mean
any Individual Property which is subject to a mortgage or deed of trust in
favor of the Agent to secure the Obligations (including, without limitation,
the Orlando Property).

 

Net
Cash Flow as defined
in Section 7.28.1(a).

 

Net
Proceeds shall mean
the gross proceeds received from any insurance recovery or condemnation award
relating to any casualty or taking of any asset less the aggregate of (i)
obligations due to the holders of Mortgage Debt thereon, including, without
limitation, any prepayment penalties or fees, and (ii) all reasonable costs and
expenses incurred in the collection of such amounts, including, but not limited
to, reasonable attorney’s fees, payable to third-parties who are not a Borrower
Subsidiary or other Loan Party or an Affiliate thereof.

 

Net
Refinancing Proceeds shall mean
the gross proceeds received from the closing of the financing or refinancing of
a specified asset less the aggregate of (i) obligations due to the holders of
Mortgage Debt thereon, including, without limitation, any prepayment penalties
or fees, and (ii) reasonable closing costs payable to third-parties who are not
a Borrower Subsidiary or other Loan Party or an Affiliate thereof.

 

Net
Sales Proceeds shall mean
the gross sale proceeds received from the closing of the sale of a specified
asset less the aggregate of (i) obligations due to the holders of Mortgage Debt
thereon, including, without limitation, any prepayment penalties or fees, and
(ii) usual closing adjustments, and (iii) reasonable closing costs payable to
third-parties who are not a Borrower Subsidiary or other Loan Party or an
Affiliate thereof.

 

Note shall mean, singly and collectively, the Note or Notes
payable to Agent on behalf of the Lenders in the original principal amount of
Fifty-Three Million Dollars ($53,000,000.00).

 

Notice
of Intention to Distribute
an defined in Section 9.2.1.

 

Obligations shall mean all indebtedness, obligations and liabilities of
the Borrower to the Agent and/or any Lender existing on the date of this
Agreement or arising thereafter, direct or indirect, joint or several, absolute
or contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, assignment, operation of law or otherwise, arising
or incurred under this Agreement, the Note, or any of the other Loan Documents,
including, without limitation, under any Interest Rate Protection Agreement
with the Agent with respect to the Loan.

 

OFAC:  Office of Foreign
Asset Control of the Department of the Treasury of the United States of
America.

 

 

OFAC
Review Process:  That certain review process established by
Agent to determine if any potential transferee of any interests or any assignee
of any portion of the Loan or any of their members, officers or partners area a
party with whom Agent and any Lender are restricted from doing business under
(i) the regulations of OFAC, including those Persons named on OFAC’s Specially
Designated and Blocked Persons list, or (ii) any other statute, executive order
or other governmental action or list (including the September 24, 2001
Executive Order Blocking Property and Prohibiting Transactions With Persons Who
Commit, Threaten to Commit, or Support Terrorism).

 

Officer’s
Certificate shall mean a
certificate delivered to the Agent by a Borrower, a Subsidiary of a Borrower,
or a Guarantor, as the case may be, respectively, which is signed by an
authorized officer thereof (or an authorized officer of the direct or indirect
managing general partner or managing member, as applicable, of such Borrower,
the Borrower Subsidiary, or such Guarantor, if and as applicable).

 

One-Month
LIBOR Rate  as defined in Section 2.4

 

Orlando
Owner shall mean FT-Orlando Property
LLC, a Delaware limited liability company.

 

Orlando
Property shall mean
the Individual Property located at 4400 Alafaya Trail, Orlando, Florida ground
leased by the Orlando Owner.

 

Ownership
Interest Agreements shall mean
all of the agreements establishing any Remainder Ground Lease Option or Ground
Lease Extension Option in favor of a Property Owner in an Individual Property,
including the Ground Leases.

 

Park
Plaza as defined in Section 1.2.

 

Payment
Direction Letters as defined
in Section 7.15.

 

PBGC shall mean the Pension Benefit Guaranty Corporation established
pursuant to Section 4002 of ERISA, or any successor thereto.

 

Percentage:  With respect to
each Lender, the percentage that its Commitment constitutes of the maximum
amount of the Loan.

 

Permitted
Debt as defined in Section 8.4.

 

Permitted
Distributions as defined
in Section 8.18.

 

Permitted
Investments as defined
in Section 8.19.

 

Permitted
Liens as defined in Section 8.2.

 

Permitted
Refinance as defined
in Section 8.4.3.

 

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

 

 

Plan shall mean any multiemployer or single-employer plan as
defined in Section 4001 of ERISA, which is maintained or contributed to by
(or to which there is an obligation to contribute of) a Borrower or any
Subsidiary of a Borrower or an ERISA Affiliate, and each such plan for the five
year period immediately following the latest date on which such Person or an
ERISA Affiliate maintained, contributed to or had an obligation to contribute
to such plan.

 

Prime
Rate 
That interest rate established from time to time by KeyBank National
Association as its prime rate, whether or not such rate is publicly announced;
the Prime Rate may not be the lowest interest rate charged by KeyBank National
Association for commercial or other extensions of credit.

 

Prime
Rate Margin  Two and one half (2.50%) percent (250 basis
points) per annum.

 

Property
Owners shall mean, singly and
collectively, the Borrower Partnerships and the Borrower LLCs being the owners,
land estate holders, or ground lessees of the Individual Properties.

 

Rejectable
Offer shall mean the rejectable offer
of any tenant pursuant to a Lease respecting any Individual Property to
purchase the respective Individual Property at a predetermined price, as and
when may be specifically provided in any such Lease respecting any Individual
Property.

 

Rejection
Test as defined in Section 7.23.6.

 

Related
Documents shall mean,
singly and collectively, the Formation Documents, each Ownership Interest
Agreement, the Payment Direction Letters, and the documents establishing and evidencing
any Mortgage Debt.

 

Related
Fund shall mean, with respect to a
Lender which is a fund that invests in loans, any other such fund managed by
the same investment advisor as such Lender or by an Affiliate of such Lender or
such advisor.

 

Remainder
Ground Lease Option Schedule as
defined in Section 6.17.7.

 

Reportable
Event 
shall mean an event described in Section 4043(b) of ERISA with
respect to a Plan other than those events as to which the 30-day notice period
is waived under subsection .13, .14, .16, .18, .19 or .20 of PBGC
Regulation Section 2615, or as otherwise now or hereafter defined in
ERISA.

 

Required
Lenders:  Lenders holding Percentages aggregating at
least sixty six and two-thirds percent (66 2/3%).

 

Reserve
Percentage:  For any LIBOR Rate Interest Period, that
percentage which is specified three (3) Business Days before the first day of
such LIBOR Rate Interest Period by the Board of Governors of the Federal
Reserve System (or any successor) or any other governmental or quasi-governmental
authority with jurisdiction over Lender for determining the maximum reserve
requirement (including, but not limited to, any marginal reserve requirement)
for Lender with respect to liabilities constituting of or including (among
other liabilities) Eurocurrency liabilities in an amount equal to that portion
of the Loan affected by such LIBOR Rate Interest Period and with a maturity
equal to such LIBOR Rate Interest Period.

 

 

Second
Extended Maturity Date as
defined in Section 2.2.

 

Second
Extended Term as defined
in Section 2.2.

 

Security
Documents as defined
in Section 3.2.

 

Single-Purpose
Entity shall mean, with respect to a
Person, that such Person has Formation Documents which contain generally the
following provisions (with such variations as required by the provisions of the
First Mortgage Debt), and has agreed to abide by such terms and conditions:

 

(a)                                  Such
Person shall not engage in any business or activity other than acquiring by
merger the assets and liabilities of the applicable Property Owner.

 

(b)                                 Such
Person shall not acquire or own any material assets other than (i) the real
property owned by the Borrower Partnership or Borrower LLC on the Closing Date,
and (ii) such incidental personal property as may be necessary for the
operation of such real property.

 

(c)                                  Such
Person shall not fail to preserve its existence as an entity duly organized,
validly existing and in good standing (if applicable) under the laws of the
jurisdiction of its organization or formation and under the applicable laws of
any state or states in which the ownership of its assets or the conduct of its
business requires such qualification.

 

(d)                                 Such
Person shall not incur any Debt, except as provided herein.

 

(e)                                  Such
Person shall not merge into or consolidate with any person or entity or
dissolve, terminate or liquidate in whole or in part, transfer or otherwise
dispose of all or substantially all of its assets or change its legal
structure.

 

(f)                                    Such
Person shall not own any subsidiary or make any investment in any person or
entity.

 

(g)                                 Such
Person shall not file or consent to the filing of any petition, either
voluntary or involuntary, to take advantage of any applicable insolvency,
bankruptcy, liquidation or reorganization statute, or make an assignment for
the benefit of creditors.

 

(h)                                 Such
Person shall agree to abide by the following covenants in its management and
operation:

 

(i)                                     To maintain its
records, books of account and bank accounts separate and apart from those of
any other Person;

 

(ii)                                  Not to commingle
assets with those of any other Person;

 

(iii)                               Not to maintain its
assets in such a manner that it will be costly or difficult to segregate,
ascertain or identify its individual assets from those of any other Person;

 

(iv)                              To maintain separate
financial statements;

 

(v)                                 To pay its own
liabilities out of its own funds;

 

 

(vi)                              To observe all corporate,
partnership or limited liability company formalities;

 

(vii)                           To maintain an arm’s-length
relationship with its Affiliates;

 

(viii)                        To pay the salaries of its own
employees and maintain a sufficient number of employees in light of its
contemplated business operations;

 

(ix)                                Not to guarantee or
become obligated for the debts of any other entity or hold out its credit as
being available to satisfy the obligations of others, except as provided for
herein;

 

(x)                                   Not to acquire
obligations or securities of its partners, members or shareholders;

 

(xi)                                To allocate and charge
fairly and reasonably any overhead for shared office space or any common
employee or overhead shared with affiliates;

 

(xii)                             To use separate
stationery, invoices and checks;

 

(xiii)                          Not to pledge its assets for
the benefit of any other entity or make any Loan or advances to any entity,
including any general partner or any affiliate thereof, except as provided for
herein;

 

(xiv)                         To hold itself out to the
public as a legal entity separate and distinct from any other Person and to
conduct its business solely in its own name in order not (A) to mislead others
as to the identity with which such other Person is transacting business, or (B)
to suggest that such Person is responsible for the debts of any third party
(including any general partner or any affiliate thereof or any other Person);

 

(xv)                            To correct any known
misunderstanding regarding its separate identity; and

 

(xvi)                         To maintain adequate capital
and cash on hand for the normal obligations reasonably foreseeable in a
business of its size and character and in light of its contemplated business
operations.

 

State shall mean the State or Commonwealth in which the subject
of such reference or any part thereof is located.

 

Statement as defined in Section 14.17.

 

Subsequent
Advance as defined in Section 2.1.2(b).

 

Subsidiary shall mean, with respect to any Person, any corporation,
association, limited liability company, partnership or other business entity of
which securities or other ownership interests representing more than 50% of
either (x) the beneficial ownership interest or (y) ordinary voting power are,
at the time as of which any determination is being made, owned or controlled,
directly or indirectly, by such Person.

 

 

Title
Reports as defined in Section 5.10(a).

 

Total
Commitment.  The sum of the Commitments of the Lenders, as
in effect from time to time.

 

UCC or the Uniform Commercial Code means the Uniform
Commercial Code in effect in a State.

 

Unfunded
Current Liability of any Plan
means the amount, if any, by which the actuarial present value of the
accumulated plan benefits under the Plan as of the close of its most recent
plan year exceeds the fair market value of the assets allocable thereto, each
determined in accordance with Statement of Financial Accounting Standards No.
35, based upon the actuarial assumptions used by the Plan’s actuary in the most
recent annual valuation of the Plan.

 

United
States and U.S. shall each mean the United States of America.

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